More vets seek care with private physicians, but reimbursements below Medicare rates

Veterans can now be referred to non-U.S. Department of Veterans Affairs (VA) primary care physicians (PCPs) to lessen wait times, but there might be pushback because reimbursement may be below standard Medicare rates.

The VA’s Patient-Centered Community Care (PC3) program lets VA medical centers purchase non-VA care through contracted providers. The two providers currently in place, TriWest and Health Net, both note that paying below Medicare reimbursement rates is allowable.

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“TriWest pays against the VA Fee structure,” William Cahill, vice president of government relations for TriWest Healthcare Alliance, told Medical Economics. “Where the market allows, VA would like us to obtain discounts off of that fee structure.”

Health Net has more than 235,000 providers in its TRICARE and VA programs, said spokesperson Brad Kieffer.

The company, which uses the standard Medicare rates for provider contracts as a starting point, is “absolutely committed to negotiating mutually agreeable contracts best serving those in our military and veterans communities.” Kieffer said.

Kieffer said that because both programs have reimbursement rates derived from the Medicare methodology, “most of our contracts are equal to or below Medicare rates, depending on specific needs.”

Expansion of the PC3 program to include primary care “supports the VA’s Accelerated Care Initiative, helping to move veterans off of waitlists and into care,” according to a VA press release. The move follows reports of backlogs and veterans who died while awaiting treatment, revelations that led to the resignation of VA Secretary Eric K. Shinseki and appointment last month of Robert A. McDonald, former Proctor and Gamble chief executive officer.

The VA made 838,000 referrals to non-VA doctors in the last several months, up from 166,000 over the same time last year, noted McDonald in his August 13 address to Am Vets in Memphis, Tennessee.

Each referral on average “results in seven visits or appointments. So, we’re talking about more than 1.1 million additional appointments in the private sector just from increased referrals over the last two months,” he said.

“This modification is another example of how we are working to ensure veterans get the care they need, when they need it and where they want to be seen.”

The PC3 program was launched in January to provide non-VA services to vets for specialty, mental health care, emergency care, and limited newborn care.

An additional $10 billion for referrals to private doctors was made available August 7 through the Veterans Access, Choice, and Accountability Act. Under the law, vets can be provided access to non-VA providers if they’ve waited at least a month for a medical appointment or live at least 40 miles from a VA hospital or clinic.  The bill also sets aside $5 billion for hiring more VA doctors, nurses and other medical staff, and $1.3 billion to open 27 new VA clinics across the country.

In 2013, the VA spent $4.8 billion on outside medical care, or 10% of its budget, according to the Washington Post.

The American Academy of Family Physicians (AAFP), which supports the new bill and the PC3 expansion to include primary care, noted in a press release that “payment will be negotiated at rates not to exceed Medicare rates, except in highly rural areas to ensure access to care. “ 

But the organization is also “a strong advocate for family and primary care physicians to be paid for the value” of their work,” Reid Blackwelder, MD, FAAFP, AAFP president, told Medical Economics.

Blackwelder noted that AAFP members see an average of nine patients a week who are under- or uninsured, and said an influx of VA patients receiving even Medicare reimbursement rates can help balance that.

“The most important aspect is we have long advocated improved access to care for veterans, and we’re ready to serve,” said Blackwelder.

Related:VA bill allows more vets to seek care at private clinics

More veterans could seek healthcare from private practices, hospitals