DEPARTMENT OF VETERANS AFFAIRS (VA) REPORT TO CONGRESS ON CLAIMS PAYMENT PROCESSING FOR THE VETERANS ACCESS, CHOICE, AND ACCOUNTABILITY ACT Issue: Section 101(k)(4)(B) of the Veterans Access, Choice, and Accountability Act of 2014, Public Law (P.L.) 113-146 (Choice Act), as amended, directs the Secretary of Veterans Affairs to submit to the House and Senate Committees on Veterans? Affairs a quarterly report on the accuracy of the nationwide system for processing and paying bills or claims for authorized care and services furnished to eligible Veterans under the Veterans Choice Program (Choice Program) established by section 101. Discussion: Legislative Background On August 7, 2014, President Obama signed the Choice Act into law. Section 101 of the Choice Act established the Choice Program, a new temporary program to furnish hospital care and medical services to eligible Veterans through eligible non-VA health care providers. Amendments to the Choice Act were made on September 26, 2014, by the Department of Veterans Affairs Expiring Authorities Act of 2014 (PL. 113-175); on December 16, 2014, by the Consolidated and Further Continuing Appropriations Act of 2015 (PL. 113-235); on May 22, 2015, by the Construction Authorization and Choice Improvement Act (P.L. 114?19); on July 31, 2015, by the Surface Transportation and Veterans Health Care Choice Improvement Act of 2015 (PL. 114-41); on April 19, 2017, by an act to amend the Choice Act to modify the termination date for the Veterans Choice Program, and for other purposes (P.L. 115-26); and on December 22, 2017, by the Third Continuing Appropriations for Fiscal Year 2018, Missile Defense, Health Provisions, Other Matters and Budgetary Effects (P.L. 115?96). On June 6, 2018, the President signed the VA Maintaining Internal Systems and Strengthening Integrated Outside Networks (MISSION) Act of 2018, which appropriated an additional $5.2 billion to the Choice Fund to continue the Choice Program while VA prepares to implement the newly-consolidated Veterans Community Care Program. The MISSION Act also authorizes VA to use the Veterans Choice Fund for other community care, effective March 1, 2019. The Choice Program will expire when the amounts in the Choice Fund are exhausted or on June 6, 2019, whichever occurs first. Veterans Choice Program Regulations As required by the Choice Act, on November 5, 2014, VA published an interim final rulemaking, RIN 2900-AP24, that amended sections 17.108, 17.110, and 17.111 of title 38 of the Code of Federal Regulations (CFR) and established new regulations at 38 CFR 17.1500 through 17.1540 to implement the Choice Program. VA published another interim final rulemaking on April 24, 2015, modifying the methodology for calculating distances under the Choice Act from geodesic, or straight~line, distance to driving distance. On October 29, 2015, VA published a Final Rule, adopting minor changes to the regulations to reflect statutory amendments authorizing VA to pay higher than Medicare rates in Alaska and Maryland. On December 1, 2015, VA published a third interim final rulemaking, RIN 2900-AP60, to implement additional amendments to the Choice Act made by the Construction Authorization and Choice Improvement Act of 2014 and the Surface Transportation and Veterans Health Care Choice Improvement Act of 2015. Proqram Implementation VA signed contracts with two private health care companies to assist with the administration of the Choice Program. The contracts required our partners, TriWest and Health Net Federal Services, to schedule appointments for eligible Veterans, adjudicate and pay community provider medical service claims, and operate a call center to answer Veterans' questions about the program. VA is continuing to work with the contractors to make improvements to the delivery of benefits through the Choice Program and has, in some areas, taken back the Veteran appointment scheduling function. In accordance with section 101(k) of the Choice Act, Choice Program reimbursement processing and payment was centralized to ensure efficiency of processing and accuracy of a preper payment. Claim reimbursement oversight is provided by the VA Office of Community Care Delivery Operations. Contractor medical service invoices were transferred to Veterans Integrated Service Network (VISN) 15, VA St. Louis Health Care System (HCS) claims processing systems (local Veterans Health Information Systems Technology Architecture (VistA) and the Fee Basis Claims System where the contractor's reimbursement claims were processed by Austin, Texas-based staff and management of the VA Financial Services Center (FSC). Access to VISN 15, VA St Louis HCS system was provisioned, and training was completed in January 2015. A FBCS system enhancement was completed in January 2015 to allow for Choice claims to be routed electronically to the centralized payment center in VISN 15. The contractors began submitting claims in February 2015 and claims paid in accordance with the law and contract terms. In Fiscal Year (FY) 2017, VA began transitioning Choice claims from FBCS to FSC's Plexis Claim Manager (PCM) system located in Austin, Texas. PCM allows for greater auto~adjudication rates while applying consistent, industry standard business rules. VA is utilizing the Improper Payment Elimination Reduction and Improvement Act (IPERIA) criteria for accuracy standards for processing and payment of Choice claims. The IPERIA standards target is 98.5 percent payment accuracy. The goal is for all Community Care medical claims, to include Choice reimbursement claims, to meet this standard. VA is meeting the requirement for the auto-adjudication of these claims as of February 13, 2017, and they are now processed by FSC. VA continues to work with the contractors to improve the efficiency and accuracy of reimbursements. As of September 30, 2018, the PCIVI system had received and processed 8.8 million claims from both contractors, with a 98?percent VA reimbursement rate. PCIVI claims maintain a timely processing rate of 99.6 percent within 30 days. The average PCM reimbursement processing turnaround is 7.2 days. VA is submitting the fourth quarter report of FY 2018. The report contains data covering FY 2016, FY 2017 and FY 2018, and Total from Inception to Date, in order to demonstrate measured and sustained progress in processing claims from Health Net and TriWest. Data is derived from the FBCS and PCM systems at a fixed point of time but can change as claims status changes over time rejected, re-opened, re?processed, denied, reopened, rejected again). Through the end of the fourth quarter of FY 2018, VA processed the following claims for the Choice program: FY 2018 2nd Quarter Data Status of Claims Processed VA Amount Paid Jan-Mar FY Jan-Feb FY 2018 2018 Status Accepted 1,460,806 463,371,882.21 Denied 19,704 Rejected 2,847 Total 1,483,357 463,371 ,882.21 FY 2018 4th Quarter Data of Claims Processed VA Amount Paid Jul-Sep FY Jul-Sep FY 2018 2018 Accepted 1,254,076 369,622,87696 Deni-ed 22,500 Rejected 2,295 . Total 1,278,871 369,622,876.96 The following chart shows claims processed in FY 2017: FY 20171stQuartermData" 1:12:62:ng of Claims Status 0 ct-D 0 FY 3200c::s:g1gct- 2017 Accepted 2,258,071 738,848,77993 Denied 6 Rejected 24,710 Total 2,282,787 738,846,77993 FY 2017 3rd Quarter Data of Claims Status processed VA Amount Paid Apr-Jun FY Apr-Jun FY 2017 2017 Accepted 2,275,572 891 ,759,122.80 Denied 24,268 Rejected 1 ,882 Total 2,301,522 891 ,759,122.80 The following chart shows claims processed in FY 2016: FY 2016 1st Quarter Data of Claims Status Processed VA Amount Paid Oct-Dec FY Oct-Dec FY 2016 2016 Accepted 126,732 8 2850219371 Denied 7 Rejected 28,446 Total 155,185 28,502,19371 FY 2016 3rd Quarter Data of Claims Processed VA Amount Paid Status . . April-Jun FY AprIl-Jun FY 2016 2016* Accepted 1,232,129 357,481,192.56 Denied 12 Rejected 37,697 Total 1,269,838 357,481 ,192.56 The following chart shows claims processed since implementation: Total since Implementation (November 5, 2014, to September 30, 2018) Status of Claims Processed VA Amount Paid through EOM through EOM Sep FY 2018 Sep FY 2018 Accepted 17,167,452 $5,993,858,368.88 Denied 153,210 Rejected 200,1 12 Grand Total 17,520,774 $5,993,858,368.88 Processing of Choice claims began in March 2015 Sources: CDW FBCS Tables; Expedited Payment Table, PIT Ciaims, institutional and Professional claims. The report includes claims processed thru FBCS, the expedited payment process, and FSC Processing thru the tables. Department of Veterans Affairs November 2018