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"VA Announces Use of Standard Payment Rates for Some Non-VA Care

WASHINGTON (Dec. 16, 2010) - The Department of Veterans Affairs (VA)

announced today it will begin using Medicare's standard payment rates

for certain medical procedures performed by non-VA providers on Feb. 16,


"This regulation will have no impact on the Veterans we care for," said

VA Under Secretary for Health Dr. Robert A. Petzel. "VA will now have

the ability to better plan budgets and place more money into access to

health care for the Veterans that VA is honored to serve."

The new adjustment was made in federal regulations and will affect the

following treatments VA provides to Veterans through contracted care:

ambulatory surgical center care, anesthesia, clinical laboratory,

hospital outpatient perspective payment systems, and end stage renal

disease (ESRD).

Veterans who are eligible for care will continue to receive the

uninterrupted care they need and have earned. Non-VA doctors and

facilities will still get paid for services they provide to eligible

Veterans but at rates set by the Centers for Medicare and Medicaid

Services (CMS) Prospective Payment Systems (PPS) and Fee Schedules.

Existing contracts will not be affected and the rule allows for new

contracts using the new rates.

Savings of approximately $1.8 billion over five years will allow VA to

continue to invest in such innovative programs as a wearable artificial

kidney, home dialysis and expanding access through stand-alone clinics.

"Adopting CMS pricing methodology for these schedules and services will

allow VA medical centers to use their resources more efficiently to meet

Veterans' needs," said Gary Baker, VA's health administration chief

business officer. "The adoption of Medicare rates will help ensure

consistent, predictable medical costs, while also helping to control

costs and expenditures."

The pricing methodology changes are a result of a rule change to 38 CFR

17.56, the federal regulation that governs VA when paying medical claims

for Veterans treated in community facilities. The proposed rule was

published on Feb. 18, 2010 and was opened for public comment April 19,

2010. The congressional review period for the final rule begins Dec. 17

and lasts 60 days.

VA is providing written notifications to Veterans and non-VA providers.

As additional information becomes available, it will be posted to the

VA's "Non-VA Purchased Care" Web site, www.nonvacare.va.gov."

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