Reimbursement Hurdles in VA Community Care

Bottomline:

The VA Community Care program, while crucial for expanding veteran healthcare access, can result in reimbursement complexities for manufacturers that provide direct services to veterans who are dually eligible for both VA care and VA and Medicare.

The Department of Veterans Affairs (VA) Community Care program fills an important gap to ensure timely healthcare to veterans enrolled in the VA Health System. By supplementing direct care from the VA Medical Centers (VAMCs) through local civilian providers, the VA allows its patients to access care the VAMC cannot offer due to the wait time to see a provider, geographic location of the patient, or the need for specialized services that the VAMC does not offer in-house. Although this collaborative approach underscores the VA's commitment to delivering veteran-centric care, it can be a reimbursement challenge for certain manufacturers that deliver their product or services directly to a patient that also qualify for Medicare – particularly those offering services such as genetic screenings, prosthetics, rehabilitation devices, items classified as durable medical equipment, etc.

When a veteran is eligible for health care through both the VA and Medicare, a predetermined set of rules established by federal law and further implemented through a series of Agency regulations, frequently referred to as the “predetermined right to recover”, regulate which payer is responsible. On the surface, which party to bill first should be very simple as the VA Community Care referral is based on VA authorization for specific services and, as such, the VA would be considered the primary payer for those services. Community care providers receive direct authorization from the VA or from a VA Third-Party Administrator (such as TRIWEST) specifying the services approved and the authorized time frame in which care can be provided. So, when a community care provider provides services that were not authorized first by the VA, it is in those instances that the dually covered patient’s Medicare is billed.

Duplicative claims have been a significant finding in numerous Inspector General (OIG) reports from both agencies. Since the VA will only pay for specifically authorized services, duplicative billings, although unintentional, can occur as a provider seeks to be made whole. Examples of when duplicative billing might occur include: when a single patient’s multiple IDs (i.e., a VA Patient ID and Medicare Beneficiary Identifier) are not properly loaded during the intake process, if the VA Community Care Provider ordered a service but the VA authorization itself is delayed or not clearly defined, if the provider utilizes a billing software that does not include VA-specific payer logic (which is different than “government payer” logic), etc. Issues of duplicative billing can also occur if a claim that is initially denied by the VA due to a minor error (such as the wrong authorization number) is accidently submitted as a new claim to Medicare. However, inadvertent duplicative billing is most common when a single service has many sub-billing components or a single service is the sub-component of a larger service set, causing confusion about which components should be billed to each agency.

Historically, VA and Medicare systems were not fully integrated, so a claim paid by one did not immediately block a claim from being paid by the other. Recently, the VA and Medicare executed a robust, real-time data-sharing agreement and are now actively seeking to identify and recover funds from duplicative payments. If found, the provider will be responsible for refunding the overpayment, paying any associated interest, and, potentially, penalties associated with the error. This active matching is expected to be an on-going effort and not a single data match activity. Providers can proactively preempt payment demand letters from VA or Medicare by independently auditing payment associated with dually covered patients and contracting the appropriate agency to determine where a refund should be sent.