[Code of Federal Regulations]
[Title 38, Volume 1]
[Revised as of January 1, 2007]
From the U.S. Government Printing Office via GPO Access
[CITE: 38CFR17.56]

[Page 658-659]
 
            TITLE 38--PENSIONS, BONUSES, AND VETERANS' RELIEF
 
                CHAPTER I--DEPARTMENT OF VETERANS AFFAIRS
 
PART 17_MEDICAL--Table of Contents
 
Sec. 17.56  Payment for non-VA physician and other health care

professional services.

    (a) Except for anesthesia services, and services provided in the 
State of Alaska under pargaraph (d) of this section, payment for non-VA 
health care professional services associated with outpatient and 
inpatient care provided at non-VA facilities authorized under Sec. 
17.52, or made under Sec. 17.120 of this part, shall be the lesser of 
the amount billed or the amount calculated using the formula developed 
by the Centers for Medicare and Medicaid Services' (CMS) participating 
physician fee schedule for the period in which the service is provided 
(see 42 CFR Parts 414 and 415). This payment methodology is set forth in 
paragraph (b) of this section. If no amount has been calculated under 
Center for Medicare and Medicaid Services' participating physician fee 
schedule or if the services constitute anesthesia services, payment for 
such non-VA health care professional services associated with outpatient 
and inpatient care provided at non-VA facilities authorized under Sec. 
17.52, or made under Sec. 17.120 of this part, shall be the lesser of 
the actual amount billed or the amount calculated using the 75th 
percentile methodology set forth in paragraph (c) of this section; or 
the usual and customary rate if there are fewer than 8 treatment 
occurrences for a procedure during the previous fiscal year.
    (b) The payment amount for each service paid under Centers for 
Medicare and Medicaid Services' participating physician fee schedule is 
the product of three factors: a nationally uniform relative value for 
the service; a geographic adjustment factor for each physician fee 
schedule area; and a nationally uniform conversion factor for the 
service. The conversion factor converts the relative values into payment 
amounts. For each physician fee schedule service, there are three 
relative values: An RVU for physician work; an RVU for practice expense; 
and an RVU for malpractice expense. For each of these components of the 
fee schedule, there is a geographic practice cost index (GPCI) for each 
fee schedule area. The GPCIs reflect the relative costs of practice 
expenses, malpractice

[[Page 659]]

insurance, and physician work in an area compared to the national 
average. The GPCIs reflect the full variation from the national average 
in the costs of practice expenses and malpractice insurance, but only 
one-quarter of the difference in area costs for physician work. The 
general formula calculating the Centers for Medicare and Medicaid 
Services' fee schedule amount for a given service in a given fee 
schedule area can be expressed as: Payment = [(RVUwork x GPCIwork) + 
(RVUpractice expense x GPCIpractice expense) + (RVUmalpractice x 
GPCImalpractice)] x CF.
    (c) Payment under the 75th percentile methodology is determined for 
each VA medical facility by ranking all occurrences (with a minimum of 
eight) under the corresponding code during the previous fiscal year with 
charges ranked from the highest rate billed to the lowest rate billed 
and the charge falling at the 75th percentile as the maximum amount to 
be paid.
    (d) For services rendered in Alaska, VA will pay for services in 
accordance with a fee schedule that uses the Health Insurance 
Portability and Accountability Act mandated national standard coding 
sets. VA will pay a specific amount for each service for which there is 
a corresponding code. Under the VA Alaska Fee Schedule the amount paid 
in Alaska for each code will be 90 percent of the average amount VA 
actually paid in Alaska for the same services in Fiscal Year (FY) 2003. 
For services that VA provided less than eight times in Alaska in FY 
2003, for services represented by codes established after FY 2003, and 
for unit-based codes prior to FY 2004, VA will take the Centers for 
Medicare and Medicaid Services' rate for each code and multiply it times 
the average percentage paid by VA in Alaska for Centers for Medicare and 
Medicaid Services-like codes. VA will increase the amounts on the VA 
Alaska Fee Schedule annually beginning in 2005 in accordance with the 
published national Medicare Economic Index (MEI). For those years where 
the annual average is a negative percentage, the fee schedule will 
remain the same as the previous year. Payment for non-VA health care 
professional services in Alaska shall be the lesser of the amount 
billed, or the amount calculated under this subpart.
    (e) Payments made in accordance with this section shall constitute 
payment in full. Accordingly, the provider or agent for the provider may 
not impose any additional charge for any services for which payment is 
made by VA.
    (f) Notwithstanding other provisions of this section, VA, for 
physician services covered by this section, will pay the lesser of the 
amount determined under paragraphs (a) through (e) of this section or 
the amount negotiated with the physician or the physician's agent.

(Authority: 38 U.S.C. 513, 38 U.S.C. 1703, 38 U.S.C. 1728)

[63 FR 39515, July 23, 1998, as amended at 65 FR 66637, Nov. 7, 2000; 70 
FR 5927, Feb. 4, 2005]

              Use of Community Nursing Home Care Facilities