VA Promises to Resolve Late Payment Issues with Community Healthcare Providers

by U.S. Medicine

February 9, 2018

Slow Reimbursement Frustrated Clinicians, Hurt Veterans’ Credit

By Sandra Basu

WASHINGTON—Citing the importance of providing payments in a “timely and consistent manner,” the VA announced that it has revised its regulations for payment and reimbursement of non-VA providers.

“Our outside providers are an essential part of our network and we need to improve our system of payments for their services,” said VA Secretary David J. Shulkin, MD, in the announcement. Slow payment has frustrated clinicians and put veterans in financial jeopardy, with their credit affected by unpaid medical bills.

The agency said it would begin processing claims for reimbursement of “reasonable costs that were only partially paid by the veteran’s other health insurance. Those costs may include hospital charges, professional fees and emergency transportation, such as ambulances.”

VA also began to publish a list identifying providers with “high dollar value” of unpaid claims last month. Other actions immediately taken by VA included creating rapid response teams to “to work on the ground with these providers to reach financial settlement within 90 days” and increasing the number of claims processed by vendors by 300% in January 2018 and by 600% in April 2018 with a goal of 90% clean claims processed in less than 30 days.

The agency also plans to “deploy multiple IT improvements within the first six months of 2018 that streamline the claims submission and payment process to reduce time for payments significantly,” according to the statement. Additionally, the agency said it will award “four new contracts in 2018 for implementation in 2019 to establish the new Community Care Network that includes elements designed to ensure prompt payment of claims.”

“We could not be more pleased at the aggressive focus on this critical topic,” David McIntyre, president and CEO of TriWest, one of VA’s third-party administrators, responded.

Choice Bill and Provide Payment

The issue of delayed payments for community providers has been under increased scrutiny, especially with VA’s expansion of community care in recent years. A Government Accountability Office (GAO) report in May 2016 noted that VHA’s average claims processing timeliness in fiscal year 2015 was “significantly lower” than Medicare’s and TRICARE’s timeliness and far below its own standard of paying 90% of claims within 30 days.

“Absent a responsive provider customer service component and timely payment of claims, many community providers may opt not to participate in VA’s network, thereby narrowing the choices veterans have for seeking care from community providers. In turn, this could lead to longer wait times for veterans to receive care and a greater reliance on VA medical centers, some of which have already experienced long wait times for veterans seeking care,” the report explained.

Additionally, GAO noted that “millions of dollars in interest penalties resulting from the late payment of claims by VHA could dilute the funding available for the direct delivery of care to veterans.”

Acknowledging the problem, Shulkin cited it as a priority area last year during a press briefing in which he talked about 13 areas of “significant risk” for VA.”

 “Providers are increasingly frustrated with the VA’s ability to get them payments, to the point that some of them are actually leaving our network. And that’s obviously working against us,” he said at the time.

Shulkin explained that it took more than 30 days to process 20% of its clean claims at VA, which affects about 25,000 providers across the country. In addition, he said that VA had yet to pay about $50 million in out-patient bill charges that were six months or older.

The issue of payment to providers outside VA has rankled lawmakers. Senate Committee on Veterans Affairs Committee Ranking Member Jon Tester (D-MT) called VA’s recent announcement “long overdue.”

“I will hold the VA accountable to ensure this is not a hollow promise. Veterans’ health care is too important to let government bureaucracy get in the way of doctors who need to serve our veterans,” Tester vowed.

Pending Choice program reform bills in both the House and Senate include measures to improve timeliness of provider payments.

VA said in its announcement that it would “work with Congress to consolidate and simplify all VA community care program, including provisions for prompt payment of claims.”

Next: Top 20 Providers with High Dollar Value of Unpaid Claims

Top 20 Providers with High Dollar Value of Unpaid Claims


Florida; Texas; Louisiana; Colorado; South Carolina

Adventist Health System 


UF Health


Orlando Health 


Ohio Health


Health First


Dignity Health

California; Arizona; Texas

Bay Care Health System


Cape Fear Valley Health System

North Carolina

Tenet Health

California; Texas

Centracare Health


Carolinas Healthcare System

North Carolina

University of Cincinnati Health



North Dakota; South Dakota

Universal Health Services

Florida; District Of Columbia

University of Colorado Health


Wake Health

North Carolina

Mount Carmel Health


Lee Health


Vanderbilt Health


Source: VA

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