House Veterans’ Affairs Committee Issues Report on VA Care in Community Act (Part 2 of 3)

WASHINGTON, March 7 -- The House Veterans' Affairs Committee issued a report (H.Rpt. 115-585) on legislation (H.R. 4242) to amend title 38, U.S. Code, to establish a permanent VA Care in the Community Program. The report was advanced by Rep. Phil Roe, R-Tennessee, on March 5.

Hearings

There were no Subcommittee hearings held on H.R. 4242, as amended.

On October 24, 2017, the full Committee conducted a legislative hearing on a number of bills including a draft bill that was later introduced as H.R. 4242.

The following witnesses testified:

The Honorable Jim Banks, U.S. House of Representatives, 3rd District, Indiana; The Honorable Mike Gallagher, U.S. House of Representatives, 8th District, Wisconsin; The Honorable John R. Carter, U.S. House of Representatives, 31st District, Texas; The Honorable Glenn Thompson, U.S. House of Representatives, 5th District, Pennsylvania; The Honorable Neal P. Dunn, U.S. House of Representatives, 2nd District, Florida; The Honorable Andy Barr, U.S. House of Representatives, 6th District, Kentucky; The Honorable David J. Shulkin, M.D., Secretary, U.S. Department of Veterans Affairs, who was accompanied by Carolyn Clancy M.D, the Executive in Charge of the Veterans Health Administration, and Laurie Zephyrin M.D., MPH, MBA, the Acting Deputy Under Secretary for Health for Community Care for the Veterans Health Administration; Adrian M. Atizado, Deputy National Legislative Director, Disabled American Veterans; Roscoe G. Butler, Deputy Director for Health Care, Veterans Affairs and Rehabilitation Division, The American Legion; and, Kayda Keleher, Associate Director, National Legislative Service, Veterans of Foreign Wars of the United States.

Statements for the record were submitted by:

American Federation of Government Employees, AFL-CIO; American Health Care Association; American Medical Association; AMVETS; Concerned Veterans of America; Fleet Reserve Association; Got Your 6; Health IT Now; Iraq and Afghanistan Veterans of America; Military Officers Association of America; Military Order of the Purple Heart; National Alliance on Mental Illness; National Guard Association of the United States; Nurses Organization of Veterans Affairs/Association of VA Psychologist Leaders/Association of VA Social Workers/ Veterans Healthcare Action Campaign; Paralyzed Veterans of America; Reserve Officers Association; University of Pittsburgh; Vietnam Veterans of America; and, the Wounded Warrior Project.

Subcommittee Consideration

There was no Subcommittee consideration of H.R. 4242, as amended.

Committee Consideration

On December 19, 2017, the full Committee met in open markup session, a quorum being present, and ordered H.R. 4242, as amended, to be reported favorably to the House of Representatives by roll call vote.

During consideration of the bill, the following amendments were considered en bloc and agreed to via voice:

An amendment offered by Representative John Rutherford of Florida to improve VA's ability to recruit physicians and dentists through scholarship and educational loan repayment programs.

An amendment offered by Representative Neal Dunn of Florida to authorize veterans to obtain a transplant outside such veteran's Organ Procurement and Transplantation Network region if veteran's primary care provider opines that there is a medically compelling reason and authorize VA to support the cost of a donor transplant operation for a live donor who is not a veteran but who is donating an organ to a veteran.

An amendment offered by Representative Mike Coffman of Colorado to require community care providers to be aware of and comply with VA's Opioid Safety Initiative.

An amendment offered by Representative Jenniffer Gonzalez-Colon of Puerto Rico to require VA to report on health services provided veterans in the Northern Mariana Islands, Puerto Rico, American Samoa, Guam, and the Virgin Islands.

An amendment offered by Representative Julia Brownley of California to require VA to use actuarial analysis based on accurate demand forecasting, to certify financial projections, to limit supplemental budget requests unless absolutely necessary, and--when requesting supplemental appropriations or any other request outside the standard budget process--to provide justification for such request.

An amendment offered by Representative Gus Bilirakis of Florida to require VA to certify that community care providers have not been excluded from participating in federally funded health programs.

During consideration of the bill, the following amendments were considered:

An amendment offered and then withdrawn by Representative Elizabeth Esty of Connecticut to require VA to establish a center of excellence for the prevention, diagnosis, mitigation, treatment, and rehabilitation of health conditions related to exposure to burn pits and other environmental exposures.

An amendment offered and then withdrawn by Representative Elizabeth Esty of Connecticut to expand the Comprehensive Assistance for Family Caregivers program to caregivers of pre-9/11 veterans.

An amendment offered by Representative David P. Roe of Tennessee, the Chairman of the full Committee, to: (1) authorize, rather than require, VA to provide deference to a veteran when resolving disputes regarding primary care provider designations; (2) establish a process to transition veterans between VA and community primary care providers; and (3) authorize VA to incorporate values-based productivity models and take non-clinical duties like training and research into account when establishing performance standards. The amendment was agreed to by voice vote.

An amendment offered and then withdrawn by Representative David P. Roe of Tennessee, the Chairman of the full Committee, to set a community care authorization level for fiscal years 2019 through 2022.

An amendment offered by Representative David P. Roe of Tennessee, the Chairman of the full Committee, to create a Center for Innovation for Care and Payment. The amendment was agreed to by voice vote.

An amendment offered by Representative Mark Takano of California to require Veteran Care Agreements to be subject to Federal Acquisition Regulations. The amendment was not agreed to by voice vote.

An amendment offered by Representative Mark Takano of California to set the minimum level of VA employees at 405,386 as of September 30, 2019. The amendment was not agreed to by a recorded vote of 9 yeas to 14 noes.

An amendment offered by Representative Mark Takano of California to establish an Office of Non-VA Delivered Medical Care Accountability. The amendment was not agreed to by voice vote.

An amendment offered by Representative Ann Kuster of New Hampshire to require VA to consider whether a veteran resides in a state with no VA medical center when establishing eligibility criteria for any program that furnishes primary or specialty care through a community provider. The amendment was agreed to by voice vote.

An amendment offered by Representative Julia Brownley of California to amend the authorization of appropriations for VA major medical facility leases by requiring the Committees on Veterans' Affairs of the Senate and House of Representatives to adopt resolutions approving the leases. The amendment was not agreed to by a recorded vote of 9 yeas to 14 noes.

An amendment in the nature of a substitute offered by Representative Tim Walz of Minnesota, the Ranking Member of full Committee. The amendment in the nature of a substitute was not agreed to by a recorded vote of 9 yeas to 14 noes.

Committee Votes

Clause 3(b) of rule XIII of the Rules of the House of Representatives require the Committee to list the recorded votes on motions to report legislation and amendments thereto. During the full Committee markup of H.R. 4242, as amended, on December 19, 2017, four recorded votes were taken and are described below.

An amendment offered by Representative Mark Takano of California to set the minimum level of VA employees at 405,386 as of September 30, 2019, was not agreed to by a recorded vote of 9 yeas to 14 noes. The names of the Members who voted for and against are as follows:

An amendment offered by Representative Julia Brownley of California to amend the authorization of appropriations for VA major medical facility leases by requiring the Committees on Veterans' Affairs of the Senate and House of Representatives to adopt resolutions approving the leases was not agreed to by a recorded vote of 9 yeas to 14 noes. The names of the Members who voted for and against are as follows:

An amendment in the nature of a substitute offered by Representative Tim Walz of Minnesota, the Ranking Member of full Committee, was not agreed to by a recorded vote of 9 yeas to 14 noes. The names of the Members who voted for and against are as follows:

A motion by Representative Gus Bilirakis of Florida, the Vice Chairman of the Committee on Veterans' Affairs, to report H.R. 4242, as amended, favorably to the House of Representatives was agreed to by a recorded vote of 14 yeas and 9 noes. The names of the Members who voted for and against the motion are as follows:

Committee Oversight Findings

In compliance with clause 3(c)(1) of rule XIII and clause (2)(b)(1) of rule X of the Rules of the House of Representatives, the Committee's oversight findings and recommendations are reflected in the descriptive portions of this report.

Statement of General Performance Goals and Objectives

In accordance with clause 3(c)(4) of rule XIII of the Rules of the House of Representatives, the Committee's performance goals and objectives are to improve the provision of timely, quality care to veteran patients through both VA medical facilities and VA community care providers.

New Budget Authority, Entitlement Authority, and Tax Expenditures

In compliance with clause 3(c)(2) of rule XIII of the Rules of the House of Representatives, the Committee adopts as its own the estimate of new budget authority, entitlement authority, or tax expenditures or revenues contained in the cost estimate prepared by the Director of the Congressional Budget Office pursuant to section 402 of the Congressional Budget Act of 1974.

Earmarks and Tax and Tariff Benefits

H.R. 4242, as amended, does not contain any Congressional earmarks, limited tax benefits, or limited tariff benefits as defined in clause 9 of rule XXI of the Rules of the House of Representatives.

Committee Cost Estimate

The Committee adopts as its own the cost estimate on H.R. 4242, as amended, prepared by the Director of the Congressional Budget Office pursuant to section 402 of the Congressional Budget Act of 1974.

Congressional Budget Office Cost Estimate

Pursuant to clause 3(c)(3) of rule XIII of the Rules of the House of Representatives, the following is the cost estimate for H.R. 4242, as amended, provided by the Congressional Budget Office pursuant to section 402 of the Congressional Budget Act of 1974:

U.S. Congress,

Congressional Budget Office,

Washington, DC, February 15, 2018.

Hon. Phil Roe, M.D.,

Chairman, Committee on Veterans' Affairs,

House of Representatives, Washington, DC.

Dear Mr. Chairman: The Congressional Budget Office has prepared the enclosed cost estimate for H.R. 4242, the VA Care in the Community Act.

If you wish further details on this estimate, we will be pleased to provide them. The CBO staff contact is Ann E. Futrell.

Sincerely,

Keith Hall,

Director.

Enclosure.

H.R. 4242--VA Care in the Community Act

Summary: H.R. 4242 would increase the use of community health care and long-term care by the Department of Veterans Affairs (VA) by broadening eligibility for such care and allowing VA to enter into agreements with health care providers in the private sector without complying with the Federal Acquisition Regulation (FAR). The bill also would change VA's coverage of ambulance services and transplant operations at nondepartment facilities. In addition, H.R. 4242 would allow VA to repay loans for and provide scholarships to its medical staff. In total, CBO estimates that implementing the bill would cost $38.8 billion over the 2018-2022 period, assuming appropriation of the necessary amounts.

Enacting the bill would not affect direct spending or revenues; therefore, pay-as-you-go procedures do not apply.

CBO estimates that enacting H.R. 4242 would not increase net direct spending or on-budget deficits in any of the four consecutive 10-year periods beginning in 2028.

H.R. 4242 would impose an intergovernmental mandate as defined in the Unfunded Mandates Reform Act (UMRA) by preempting state laws that prohibit VA physicians from practicing telemedicine to treat veterans across state lines. Although it would limit the application of state regulations, that mandate would impose no duty on state governments that would result in additional spending or any significant loss of revenues.

The bill contains no private-sector mandates as defined in UMRA.

Estimated cost to the Federal Government: The estimated budgetary effects of H.R. 4242 are shown in the following table. The costs of this legislation fall within budget function 700 (veterans benefits and services).

(TABLE OMITTED)

Basis of estimate: For this estimate, CBO assumes that the bill will be enacted early in calendar year 2018 and that the estimated amounts will be appropriated each year. Estimated outlays are based on historical spending patterns for the affected programs.

VA Care in the Community Program. Section 102 would establish the VA Care in the Community Program. Through that program, the department would establish networks of health care providers outside of VA to furnish hospital care, medical services, and extended-care services to veterans enrolled in the VA health care system. Under the program, subject to appropriations, VA would be required to pay for care through those networks if VA cannot assign the veteran to a suitable primary care physician or a Patient Aligned Care Team (PACT) at a VA medical facility. Assignment may be unsuitable in the following situations:

The veteran would face excessive challenges in receiving care at a VA medical facility because of geographic, environmental, or medical factors;

The veteran believes that the assignment to a particular primary care physician or PACT at a VA medical facility would result in unsatisfactory health care;

The veteran would face long wait times for care at a VA medical facility; or

The veteran resides in a state without a full-service medical facility (such as Alaska, Hawaii, or New Hampshire).

Veterans may later choose to receive care at a VA medical facility if VA notifies them that a primary care provider or a PACT has become available.

The bill would require VA to promulgate regulations to implement the program within one year.

The VA Care in the Community Program is similar to the Veterans Choice Program (VCP), which CBO expects will end in 2018. The VCP provides community care to veterans who face excessive wait times or live 40 miles or more from a VA medical facility. CBO estimated the costs for the VA Care in the Community Program based on information about the VCP.

CBO expects that the VA Care in the Community Program would cost more than the VCP for the following reasons:

Veterans would make more visits for community health care because once they are referred for community care they could see network providers for primary care for at least one year without additional authorization from VA.

Veterans would be eligible for community care under the new program in more circumstances.

However, there are several factors that CBO expects would constrain that cost growth:

Diverting more veterans to community care could shorten wait times at VA facilities and thus reduce the number of veterans who would need to be referred to community care because VA care was not available in a timely fashion.

Regulations that need to be written to implement the program could curtail use.

Veterans would need approval from VA to receive certain specialty services.

The size and scope of community care networks could be limited, particularly in rural areas, reducing the accessibility of such care.

VA might implement the program slowly, as it did the VCP.

CBO expects that the new program would be implemented gradually and by 2022, usage of the new program would be 30 percent greater than for the VCP. CBO estimates that eventually usage of the new program would be about 75 percent greater than that of the VCP.

In 2017, VA processed 8.7 million claims at a total cost of $5 billion for community health care under the VCP. After accounting for the increase in usage, inflation, and underlying growth in enrollment in the VA health system, CBO estimates that the new program would cost $8.3 billion by 2022. In total, implementing section 102 would cost $20.3 billion over the 2018-2022 period, CBO estimates.

Veterans Care Agreements. Section 103 would allow VA to enter into Veterans Care Agreements with health care providers in the community to provide hospital care, medical services, or extended care to eligible veterans. The authorization for such agreements would exempt VA from using the competitive bidding procedures as required under the FAR. The FAR is an extensive and complex set of rules governing the federal government's purchasing processes.

Under current law, VA must comply with the FAR for agreements and contracts with community health care and extended-care providers.

According to VA, the FAR's requirements are appropriate for large and long-term agreements for contracted health care services but may not be practical for case-by-case arrangements in all regions of the United States. H.R. 4242 would allow VA to use other agreements for certain health care services and extended care provided outside the VA system.

For 2018, the Congress has provided roughly $10 billion for community health care at VA (excluding the VCP). Using information from VA, CBO estimates that implementing section 103 would give VA the legal authority to continue to provide about 40 percent (or roughly $4 billion annually) of that community health care. After adjusting for inflation and accounting for existing appropriations, CBO estimates that implementing this section would cost $17.3 billion over the 2018-2022 period.

Agreements for State Veterans Homes. Section 104 would waive the requirements of the FAR for contracts and agreements that VA enters into with state-run nursing homes for veterans. Under current law, the state veterans' homes (SVHs) must fill 75 percent of their beds with veterans. Under a contract or agreement, VA pays SVHs the full cost of care for veterans with a service-connected disability (SCD) rating of 70 percent or more. For all other veterans, VA pays SVHs a fixed daily allowance.

According to VA, in 2015 the department used such agreements to reimburse state-run nursing homes at a daily rate of $380 for each veteran with an SCD of 70 percent or more--at an annual cost of roughly $350 million (or 37 percent of the total reimbursed to SVHs). However, those agreements do not comply with the FAR, and VA does not expect to be able to enter into new FAR-compliant agreements with any of the SVHs. In the absence of this legislation, CBO expects that VA would gradually phase out the use of such agreements as veterans who are currently under that payment structure die or leave the SVHs. Those veterans would probably be replaced by veterans under the lower daily allowance rate of roughly $100 per patient. By allowing VA to enter into agreements outside of the FAR framework, CBO estimates, this proposal would more than triple VA's reimbursements to SVHs for veterans with SCDs of 70 percent or more.

As a result, after factoring in a gradual phaseout of existing non-FAR agreements, CBO estimates that enacting this provision would cost $450 million over the 2018-2022 period. The additional costs from waiving the FAR requirements would begin in 2019. Because appropriations already have been provided for such agreements in 2018, no additional funding would be necessary in that year.

Center for Innovation for Care and Payment. Section 210 would require VA to establish the Center for Innovation for Care and Payment, which would evaluate ways to reduce costs and increase efficiency at VA medical facilities. CBO expects that the center would pursue programs similar to those that were tested by the Center for Medicare and Medicaid Innovation (CMMI) operated by the Centers for Medicare & Medicaid Services. CBO estimates that costs for the center would be similar to those for CMMI. CBO expects any savings that resulted from the center's efforts would not occur in the next five years.

In 2010, CMMI received $5 million to develop models for reducing health care costs and increasing efficiency for Medicare. CBO expects that VA would need similar resources to establish its program. On the basis of information from the department regarding the availability of necessary staff, CBO expects that it would take VA two years to establish the center at an estimated cost of $5 million over the 2018-2019 period.

CMMI received $10 billion over the 2011-2019 period to test its models. CBO expects that VA's costs would be proportional. VA Health Administration costs are approximately one-tenth those of Medicare. After factoring in a gradual implementation period similar to that of CMMI, CBO estimates that the costs for the center would be $321 million over the 2020-2022 period.

In total, CBO estimates that implementing section 210 would cost $326 million over the 2018-2022 period.

Ambulance Services. Section 201 would require VA to reimburse veterans for ambulance services under certain conditions. Currently, VA can choose to reimburse veterans for ambulance services when they receive emergency care at nondepartment medical facilities. H.R. 4242 would require VA to cover the cost of ambulance services if a delay in providing immediate medical attention could result in death or harm to the veteran.

Using data from the National Institutes of Health and VA, CBO estimates that VA would reimburse veterans for about 165,000 ambulance trips each year, at an average cost of $480 per trip. The bill would require VA to pay for ambulance trips after January 1, 2019. Thus, CBO estimates that implementing section 201 would cost $281 million over the 2018-2022 period.

Transplant Donors. Section 109 would allow VA to cover costs related to organ transplant procedures incurred by veterans and their living donors for procedures at nondepartment facilities. Currently, VA covers the medical and service expenses (such as transportation and lodging) for veterans and their living donors only for procedures performed at the Department of Veterans Affairs Transplant Centers (VATCs). Otherwise, VA reimburses donors only for transportation and lodging. In 2017, VA provided 560 organ transplants, most at VATCs. Of those operations, about 200 were kidney transplants and about 20 involved living donors.

Section 109 would authorize VA to pay for transplant procedures at various locations nationwide with minimal out-of- pocket expenses for veterans and their living donors. As a result, CBO expects more veterans would use VA for such procedures and more people would be willing to donate organs. In determining the additional number of transplant procedures, CBO considered the other sources of health care coverage carried by enrolled veterans and the likelihood, under this proposal, that those veterans would instead use VA for their transplant procedures.

Using information from the Census Bureau, VA, and the Department of Health and Human Services, CBO estimates that under section 109, roughly 60 additional veterans would undergo transplants at nondepartment facilities each year, at an average cost of $750,000 per patient. CBO estimates that VA would cover the medical expenses of an additional 50 living donors (some for procedures that will occur under current law but for which VA would not pay medical expenses) each year, at an average cost of $80,000 per donor. In addition, CBO believes that implementing this section would allow veterans to undergo transplants closer to home. As a result, CBO estimates a reduction in transportation reimbursements of about $4 million each year. Based on the expectation that VA would implement the bill gradually, CBO estimates that implementing section 109 would have a net cost of $140 million over the 2018-2022 period.

Health Professional Scholarship Program. Section 301 would extend the Health Professional Scholarship Program, currently set to expire on December 31, 2019, through December 31, 2033. At an annual cost of $5 million, the program subsidizes tuition and educational fees and provides monthly stipends to medical students who pursue careers at VA. After accounting for rising tuition costs, CBO estimates that implementing section 301 would cost $15 million over the 2019-2022 period.

Loan Repayment for Medical Specialists. Section 302 would authorize VA to repay the education loans of practitioners in medical specialties for which the department has difficulty recruiting. In exchange, those specialists would commit to work for VA for two to four years. The payments could not exceed $40,000 for each year worked or a total of $160,000 over four years. Those limits could be waived for medical positions for which a shortage exists because of the location or requirements of the position.

Under a similar loan repayment program, VA can reimburse up to $120,000 for tuition and educational fees for medical personnel at the department. In 2016, roughly 2,000 employees (or less than 1 percent of total employees) received an average award of about $15,000. On the basis of participation rates and costs of that program, CBO estimates that roughly 120 medical practitioners in specialty areas would participate in the new program each year and would receive an average annual award of $23,000. After factoring in a gradual implementation period and growth in tuition, CBO estimates that implementing section 302 would cost $13 million over the 2018-2022 period.

Health Care Productivity. Section 205 would require that VA develop standards for using relative-value units (RVUs) to evaluate medical services. It also would require VA to train its health care providers to use and adhere to those standards. RVUs are tools used by physicians participating in Medicare to rank on a common scale the resources (such as medical supplies) used to provide health care.

On the basis of information from VA regarding its ability to train personnel to use RVUs in all department facilities, CBO estimates that VA would need to hire the equivalent of 10 full-time clinicians at an average annual compensation of $150,000 to develop standards and provide ongoing training and support. CBO expects that VA would develop an internal website to train its medical providers to use RVUs. CBO estimates that development of the website would cost less than $500,000.

As a result, CBO estimates that implementing section 205 would cost $9 million over the 2018-2022 period.

Scholarship Program. Section 303 would require VA to fully cover the costs of medical school for 18 eligible veterans. Under this scholarship program, VA would pay for tuition, books, fees, technical equipment, rotations, and reasonable living expenses for newly separated veterans who enter medical school in 2019. Veterans who are entitled to other education benefits provided by VA would not be eligible. Participating veterans would be required to agree to work full time at a VA medical facility for four years after completing medical school.

On the basis of the average costs to attend a private medical school, which includes tuition, books, fees, and technical equipment, CBO estimates that annual costs would average $69,000 per awardee. After adjusting for growth in the costs of medical school, CBO estimates that such education expenses would cost $5 million over the 2019-2022 period.

The Department of Defense pays monthly stipends for living expenses to recipients of similar scholarships that currently average $2,229 a month. On that basis, CBO estimates that individual stipends would total roughly $25,000 over a 10.5- month school year. After adjusting for inflation, CBO estimates that such stipends would cost a total of $2 million over the 2019-2022 period. In addition, CBO estimates that the costs of residency fees, off-site rotations, and reports would cost $1 million over 2020-2022 period.

In total, CBO estimates that implementing section 303 would cost $8 million over the 2019-2022 period.

Pay-As-You-Go considerations: None.

Increase in long-term direct spending and deficits: CBO estimates that enacting H.R. 4242 would not increase net direct spending or on-budget deficits in any of the four consecutive 10-year periods beginning in 2028.

Mandates: H.R. 4242 would impose an intergovernmental mandate as defined in UMRA by preempting state laws that prohibit VA physicians from practicing telemedicine to treat veterans across state lines. Although it would limit the application of state regulations, that mandate would impose no duty on state governments that would result in additional spending or any significant loss of revenues.

The bill contains no private-sector mandates as defined in UMRA.

Previous CBO estimates: On January 17, 2018, CBO transmitted a cost estimate for S. 2193, the Caring for Our Veterans Act of 2017, as ordered reported by the Senate Committee on Veterans' Affairs on December 5, 2017. Sections 102, 103, and 242 in S. 2193 are similar to sections 103, 104, and 109 of H.R. 4242 and the estimated costs for those sections are the same for each bill.

Estimate prepared by: Federal costs: Ann E. Futrell; Mandates: Andrew Laughlin.

Estimate approved by: Leo Lex; Deputy Assistant Director for Budget Analysis.

Federal Mandates Statement

The Committee adopts as its own the estimate of Federal mandates regarding H.R. 4242, as amended, prepared by the Director of the Congressional Budget Office pursuant to section 423 of the Unfunded Mandates Reform Act.

Advisory Committee Statement

No advisory committees within the meaning of section 5(b) of the Federal Advisory Committee Act would be created by H.R. 4242, as amended.

Statement of Constitutional Authority

Pursuant to Article I, section 8 of the United States Constitution, H.R. 4242, as amended is authorized by Congress' power to "provide for the common Defense and general Welfare of the United States."

Applicability to Legislative Branch

The Committee finds that H.R. 4242, as amended, does not relate to the terms and conditions of employment or access to public services or accommodations within the meaning of section 102(b)(3) of the Congressional Accountability Act.

Statement on Duplication of Federal Programs

Pursuant to section 3(g) of H. Res. 5, 115th Cong. (2017), the Committee finds that no provision of H.R. 4242, as amended, establishes or reauthorizes a program of the Federal Government known to be duplicative of another Federal program, a program that was included in any report from the Government Accountability Office to Congress pursuant to section 21 of Public Law 111-139, or a program related to a program identified in the most recent Catalog of Federal Domestic Assistance.

Disclosure of Directed Rulemaking

Pursuant to section 3(i) of H. Res. 5, 115th Cong. (2017), the Committee estimates that H.R. 4242, as amended, contains no directed rulemaking that would require the Secretary to prescribe regulations.

Section-by-Section Analysis of the Legislation

TITLE I--IMPROVED ACCESS FOR VETERANS TO NONDEPARTMENT OF VETERANS AFFAIRS MEDICAL CARE

Sec 101. Assignment of veterans to primary care providers

Section 101 of the bill would amend Section 1706 of Title 38, U.S.C., by adding a new subsection (d).

Section 1706(d) requires VA to assign each eligible veteran to a PACT team of the Department, or a dedicated primary care provider of the department. This section also defines the term "eligible veteran".

Section 102. Establishment of VA Care in the Community Program

Section 102(a) of the bill would amend section 1703 of title 38, U.S.C., by inserting after section 1703 a new section 1703A:

Section 1703A(a) of the bill would establish a permanent authority for the VA Care in the Community program to provide hospital care, medical services and extended care to eligible veterans through contracts and agreements. Under this section, VA would coordinate the care provided to eligible veterans through regional networks of community providers, which are to be periodically assessed for capacity.

Section 1703A(b) allows for a veteran to choose a provider from among network providers located in a regional network (or adjacent network, if closer) if VA does not have an available or accessible primary care provider for the veteran. Upon this election, a veteran may utilize this primary care provider for a period of one year and shall not be counted twice against a VA primary care provider's panel size. Should a VA primary care provider become available, the veteran will be given an option to be reassigned. This section requires VA to consider the following when determining if a VA provider is available for assignment: if the veteran faces unusual excessive burden such as geographical challenges, environmental factors, or medical conditions; if the veteran reasonably believes the assigned care team is detrimental to the patient-provider relationship and/or could result in suboptimal care; if the panel size of the team is such a number that it would prevent timely access to care or lead to sub-optimal results; or the veteran resides in a State where the Department does not operate a full medical facility. In an appeal of VA's assignment under this section, VA may give deference to the veteran if the veteran reasonably believes that their assignment would result in suboptimal care. Under this section, specialty care requires a referral from the veteran's primary care provider, with the ability for the Secretary to make exceptions. VA shall determine whether specialty care is to be sourced from a nearby VA facility, through a network provider, or pursuant to other agreements-- with preference given to VA facilities subject to various factors of veteran accommodation. This section requires referrals to be processed in a standardized manner to include the organization of a pF1rogram office at each facility. The Secretary shall establish a process to review any disagreements between the veteran, the Department, or provider as to eligibility for care or services under this section. This section also requires VA to establish procedures for transitioning a veteran to a different primary care provider so as to not adversely impact continuity of care, to include the appointment of a contact to resolve issues, transfer of relevant records, continued and coordinated treatment for chronic or current episodes of care.

Section 1703A(c) establishes that care shall be authorized through the completion of an episode of care to include all specialty and ancillary services deemed necessary. This section requires VA to provide case management for the veteran, when appropriate, and allows for case management to be provided through the network. Under this section, VA is authorized to pay non-network providers who provide care as part of an episode of care and VA shall take reasonable efforts to enter into contracts or agreements with them.

Section 1703A(d) establishes that the rates for non-VA care shall not exceed Medicare rates, with exceptions for highly rural states that require adjusted rates. This section allows for VA to incorporate value-based reimbursement models and for VA to establish a schedule of fees for care not covered under Medicare. VA may also negotiate higher rates pursuant to an agreement with a tribal or federal entity.

Section 1703A(e) establishes a 180 day requirement for claim submissions and states that all parties shall pay or notify of denial of a claim no later than 45 days for "clean" claims and 30 days for electronic claims with an additional 30 days to respond. If a claim is overdue, the penalty will be prorated daily, accrue from overdue date, computed at U.S. Treasury interest rate, and shall be resolved in subsequent billing or no later than 30 days of determination. This section states that the receipt of medical records is not required for payment, but the provider must attest to the provision of care or services.

Section 1703A(f) establishes that veterans who would pay a copay within the VA system would pay the same amount if receiving care from the community network. This section also requires VA to seek reimbursement from other non-government health care plans for non-service-connected condition care.

Section 1703A(g) requires network providers to provide medical records to veterans upon request and to the VA upon completion of care. Likewise, VA shall provide medical records as needed to network providers. VA shall also ensure medical records can be shared in an electronic format and community providers can have access to them.

Section 1703A(h) requires VA to ensure that existing VA identification cards are sufficient for receiving community care and specifically prohibits VA from creating a separate card for the program.

Section 1703A(i) states that formulary prescriptions can be submitted by community providers to the VA in the same manner, utilizing the same credentials, as community providers would submit to any retail pharmacy.

Section 1703A(j) requires the Secretary to use the quality of care standards as set by the Centers for Medicare & Medicaid Services (CMS) or other standards as determined by the Secretary.

Section 1703A(k) requires VA to assess, no less than once every three years, the capacity of each department medical center, identify gaps and how they will be filled, and forecast short and long term demands and how they impact network composition. VA shall also include commercial health care market assessment for services available within designated catchment areas.

Section 1703A(l) requires VA to plan for the allocation of funds within the Medical Community Care accounts.

Section 1703A(m) requires VA to provide an annual report for the next three years detailing rates paid as an exception to the Medicare rates.

Section 1703A(n) establishes definitions for the terms: clean claim, covered claimant, covered payer, eligible veteran, and fraudulent claim.

Section 102(b) provides conforming amendments to the bill.

Section 102(c) provides definitions for the following terms: Network Provider, VA Care in the Community.

Section 102(d) requires that the bill may not be construed to affect obligations entered into via prior agreements or contracts.

Sec. 103. Veterans Care Agreements

Section 103 of the bill would amend Section 1706 of Title 38, U.S.C., by inserting after section 1703A, added by section 102, a new section 1703B--Veterans Care Agreements with non- network providers:

Section 1703B(a) authorizes the use of provider agreements in addition to contracts for care and services when contracts are impractical or inadvisable. This section requires VA to review each agreement once during the 18-month period beginning six months after entering an agreement and each four-year period after any agreement that exceeds $3 million for a provider that furnishes homemaker or home health aide services, or $1 million for any other provider.

Section 1703B(b) establishes the requirements for network provider participation under the program.

Section 1703B(c) requires VA to establish a process for certification of network providers under the program or to adopt a process already administered by another Federal department or agency.

Section 1703B(d) requires that agreements be applied in the same manner as Section 1703A of Title 38, U.S.C.

Section 1703B(e) stipulates that network providers are not subject to any provision that providers of Medicare and Medicaid are not subject to, as well as other provisions of law regarding integrity, ethics, fraud, protection of whistleblowers, and Title VII of the Civil Rights Act of 1964.

Section 1703B(f) states that agreements can be terminated by VA or the provider at such time and upon such notice as required by the Secretary.

Section 1703B(g) requires VA to establish administrative procedures to handle disputes, and states that entities must exhaust administrative procedures before pursuing judicial review.

Section 1703B(h) states that, in the course of an episode of care, VA may compensate a non-network provider who provides care as part of that treatment.

Section 1703B(i) requires VA to submit a report at the beginning of each fiscal year on all provider agreements entered into the prior year. The reporting requirement sunsets five years after the date of enactment.

Section 1703B(j) requires VA to utilize quality of care standards set forth by CMS or as determined by the Secretary.

Section 1703B(k) states that the authority to enter into and terminate agreements shall not be delegated to below the VISN Director or Director of a Network Contracting Office.

Section 1703B(l) provides definitions for the following terms: Appropriate Congressional Committees, Eligible Veteran.

Section 103(b) provides a clerical amendment to this section.

Sec. 104. Modification of authority to enter into agreements with state homes to provide nursing home care

Section 104(a) allows for the use of agreements under the program.

Section 104(b) exempts VA from certain competitive procedures and states that providers are not subject to any provision that providers of Medicare or Medicaid are not subject to. This section also states that other provisions of law regarding integrity, ethics, or fraud apply.

Section 104(c) requires VA to establish, through regulations, an effective date to be published in the Federal Register no later than 30 days prior to such date.

Sec. 105. Electronic interface for processing of claims

Section 105(a) establishes requirements for VA's Chief Information Officer to put in place an IT system to receive, process, and pay claims and outlines the capabilities required of such an IT system.

Section 105(b) ensures that all federal information protection requirements are met.

Section 105(c) allows for VA to enter into a contract for the purposes of this section.

Section 105(d) sets definitions for the following terms: electronic protected health information, covered non-department health care providers, secure development requirements, VA Care in the Community Program.

Sec. 106. Funding for VA Care in the Community Program

Section 106(a) requires all funds for Section 1703B to be derived from the Medical Community Care Account.

Section 106(b) requires that all unobligated amounts from Sec. 802 of PL 113-146 shall be transferred to the Medical Community Care Account on the later of the following: one year after enactment; or, the date on which the Secretary certifies implementation of Section 1703A to Congress.

Section 106(c) defines the VA Care in the Community Program.

Sec. 107. Termination of certain provisions authorizing care to veterans through non-Department of Veterans Affairs providers

Section 107(a)(1) of the bill would amend Section 1703 of Title 38, U.S.C., adding a new subsection (e):

Section 1703(e) of title 38, U.S.C., terminates Section 1703 of Title 38, U.S.C., upon VA's certification that 1703A is fully implemented. This section also includes conforming amendments regarding dental care, readjustment counseling, death in a department facility and Medicare provider agreements.

Section 107(b) repeals an authority for VA to contract for scarce medical specialists.

Section 107(c) sets an effective date for amendments under this section of the date on which the Secretary certifies that Section 1073A of Title 38 is fully implemented.

Sec. 108. Implementation and transitions

Section 108(a) states that implementation of Sections 1703A and 1703B of title 38, U.S.C., shall commence no later than one year after enactment and that VA shall prescribe interim final rules. The same date applies to the transfer of funds, as required by section 106(b).

Section 108(b) requires the Secretary to certify that providers and employees are trained to furnish care and services under this program. This section requires VA to establish written guidance on policies and procedures for the program.

Sec. 109. Transplant procedures with live donors and related services

Section 109(a) of the bill would amend subchapter I of chapter 17 of title 38, U.S.C. by inserting after Section 1703B of title 38, U.S.C., Section 1703C--"Transplant Procedures with Live Donors and Related Services."

Section 1703C(a) of subchapter I, if a veteran is eligible for a transplant procedure from the Department, the Secretary may provide for a transplant operation on a live donor notwithstanding the live donor's eligibility for health care from the VA.

Section 1703C(b) of subchapter I authorizes VA to support the cost of a donor transplant operation, including perioperative care for a live donor who is not a veteran but who is donating an organ for a veteran.

Section1703C(c) of subchapter I would allow for non-VA facilities to be used for transplant operations on living donors as long as the transplant center is in compliance with regulations prescribed by the Centers for Medicare and Medicaid Services.

Continues with Part 3 of 3

TARGETED NEWS SERVICE: Myron Struck, editor; 703/304-1897; [email protected]; https://targetednews.com