04-317. Charges to Tortiously Liable Third Parties for Hospital, Medical, Surgical, and Dental Care and Treatment Furnished by the United States (Department of Veterans Affairs)

AGENCY:

Office of Management and Budget, Executive Office of the President.

ACTION:

Notification of charges to tortiously liable third parties for hospital, medical, surgical, and dental care and treatment furnished by the Department of Veterans Affairs.

SUMMARY:

By virtue of the authority vested in the President by section 2(a) of the Federal Medical Care Recovery Act, Public Law 87-693 (76 Stat. 593; 42 U.S.C. 2652), and delegated to the Director of the Office of Management and Budget by Executive Order No. 11541 of July 1, 1970 (35 FR 10737), the charges to tortiously liable third parties for hospital, medical, surgical, and dental care and treatment (including prostheses and medical appliances) furnished by the Department of Veterans Affairs are the “reasonable charges” generated by the methodology set forth in 38 CFR 17.101 and published from time to time in the Federal Register, most recently on April 29, 2003 (68 FR 22774). These charges are for use in connection with the recovery from tortiously liable third persons of the reasonable value of hospital, medical, surgical, and dental care and treatment furnished by the United States through the Department of Veterans Affairs (28 CFR 43.1-43.4). These charges have been established in accordance with the requirements of OMB Circular A-25, which requires charges that are at least as great as the full cost of the services provided

There are two basic reasons for this change. First, VA's community-based “reasonable charges” more accurately reflect the reasonable value of the medical care and treatment furnished by VA to the injured person, consistent with 42 U.S.C. 2651 and 2652, than do VA's cost-based per-diem tort rates.

Second, VA's present dual-rate billing system (tort feasor and health plan), using significantly different charges, is confusing and difficult to justify. VA claims, for example, may be made both against the tort feasor who caused the injury, using the current FMCRA per-diem rates, and against the veteran's health plan, using the significantly higher reasonable charges, for the same VA medical care. This not only is confusing to VA billing officials and makes settling claims more difficult, but such dual billing also may disadvantage veterans by providing a per-diem rate bill to assert against the tort feasor while exposing veterans to subrogation claims from their health plans who paid at the higher reasonable charges rates. Making the charges billed to all liable parties in FMCRA cases uniform will eliminate confusion and remove an impediment to allowing injured veterans to assert the higher reasonable charges rates for their causally related health care as a necessary and proper element of damages in their cases against the responsible tort feasors.

Beginning on January 7, 2004, the charges prescribed herein supercede those established by the Director of the Office of Management and Budget for the Department of Veterans Affairs on November 1, 1999 (64 FR 58862).

Joshua B. Bolten,

Director.