Comment on AN37-Proposed Rule-Unknown Submitter

The economic analysis stated in the proposed rule is inadequate, as it compares the percentage of veterans referred to community health care providers from the entire veteran population, when VA treats only about 1 out of every 4 veterans and the economic impact upon certain health care providers in a given area as a result of the proposed change in payment methodology is not given for review and analysis. For example, there may only be two hospitals in a certain geographic region performing outpatient surgery services. One hospital may be accepting more veteran referrals than the other, and this hospital will experience a greater adverse financial effect than its competitor due to loss of revenue. This may result in greater competition for non-veteran patients to compensate for lower reimbursement for veteran patients, reduced access to services for veteran referrals, and lessened capacity in the community for services if the hospital is forced to reduce such services due to financial strain. The economic analysis stated in the proposed rule does not appear to address these concerns. Additionally, there is no discussion of possible alternatives for implementing changes in payment amounts, such as phasiing in Medicare rates, including incentive payments for accept veteran referrals within requested time frames, quality of care provided, etc. There is also no discussion of using other than Medicare as VA's reimbursement structure, such as the 80th percentile, etc., as most insurance plans do. It is recommended that VA provide a more in-depth and detailed economic analysis on the impact of the proposed changes by provider type and by region so the public may properly assess its expected impact upon health care services. It is recommended that VA consider a phased-in approach similar to Medicare implementation, such as blended payments for the first five years to lessen the financial burden on health care providers and provide incentive payments.