Department of Health and Human Services 

OFFICE OF 

INSPECTOR GENERAL 

PHYSICIAN PARTICIPATION IN THE


VACCINES FOR CHILDREN PROGRAM


. 

JUNE GIBBS BROWN 

Inspector General 

JUNE 1995 

awM-93-oo320 
OFFICE OF INSPECTOR GENERAL 

The mission of the Office of Inspector General (OIG), as mandated by Public Law 95-452, as 

amended, is to protect the integrity of the Department of Health and Human Services’ (HHS) 

programs as well as the health and welfare of beneficiaries served by those programs. This 

statutory mission is carried out through a nationwide network of audits, investigations, and 

inspections conducted by three OIG operating components: the Office of Audit Services, the 

Office of Investigations, and the Office of Evaluation and Inspections. The OIG also informs 

the Secretary of HHS of program and management problems and recommends courses to 

correct them. 

OFFICE OF AUDIT SERVICES 

The OIGS Office of Audit Setvices (OAS) provides all auditing services for HHS, either by 

conducting audits with its own audit resources or by ovemeeing audit work done by others. 

Audits examine the performance of HHS programs and/or its grantees and contractors in 

carrying out their respective responsibilities and are intended to provide independent 

assessments of HHS programs and operations in order to reduce waste, abuse, and 

mismanagement and to promote economy and efficiency throughout the Department. 

OFFICE OF INVESTIGATIONS 

The OIG’S Office of Investigations (01) conducts criminal, civil, and administrative 

investigations of allegations of wrongdoing in HHS programs or to HHS beneficiaries and of 

unjust enrichment by providers. The investigative efforts of 01 lead to criminal convictions, 

administrative sanctions, or civil money penalties. The 01 also oversees State Medicaid fraud 

control units which investigate and prosecute fraud and patient abuse in the Medicaid program. 

OFFICE OF EVALUATION AND INSPECTIONS 

The OIGS Office of Evaluation and Inspections (OEI) conducts short-term management and 

program evaluations (called inspections) that focus on issues of concern to the Department, 

the Congress, and the public. The findings and recommendations contained in these inspection 

reports generate rapid, accurate, and up-to-date information on the efficiency, vulnerability, 

and effectiveness of departmental programs. 

OEI’S Atlanta Regional Office prepared this report under the direction of Jesse J. Flowers, 

Regional Inspector General and Christopher Koehler, Deputy Regional Inspector General. 

Principal OEI staff included: 

REGION HEADQUARTERS OTHER REGIONS 

Betty Apt, Team Leader Mark Ihshat, SC.D. Suzanne Johnson, Chicago 

Jackie Andrews, Project Leader Ann O’Connor Carolyn Neuwirth, Dallas 

Josiah Townsel Michael Sullivan, Boston 

Tammy Bonney 

For additional copies of this report, please contact the Atlanta Regional Office at 404-331-

4108. 
Department of Health and Human Services 

OFFICE OF 

INSPECTOR GENERAL 

PHYSICIAN PARTICIPATION IN THE


VACCINES FOR CHILDREN PROGRAM


. fJi SERVIC&$ 

@ “G. 

~+ ‘? 

g JUNE GIBBS BROWN 

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Inspector General 

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4*daa > JUNE 1995 

OEI-04-93-0032(-J 
EXECUTIVE SUMMARY


PURPOSE 

To identify issues affecting physician participation in the Vaccines for Children 

program. 

BACKGROUND 

The Public Health Sewice (PHS) launched a major initiative to help increase 

immunization levels for 2-year-olds. Rates for the complete vaccine series increased 

from about 50 percent in 1991 to 66 percent in the first quarter of 1994. However, 

the goal is to reach 90 percent. One part of the PHS initiative is the recently enacted 

Vaccines for Children program (VFC) which allows the Federal government to 

purchase vaccines from manufacturers and provide the vaccines free to physicians who 

participate in the program. Participating physicians can use the free vaccines to 

immunize children enrolled in Medicaid, Native American children, Alaskan Native 

children, and children without insurance. Children who have insurance but the 

insurance does not cover immunizations (“underinsured’ children) are also eligible for 

VFC program vaccines, but only at Federally Qualified Health Centers or Rural 

Health Clinics. 

Prior to the VFC program, 12 States were providing free vaccine to private physicians 

to immunize all children in their States. The States are commonly referred to as 

universal States. Most universal States had a 90 percent or more physician 

participation rate. 

The Centers for Disease Control and Prevention (CDC) asked for assistance from the 

office of Inspector General to identify and describe barriers to physician participation 

in the VFC program. We conducted this study in response to that request. To 

identi~ issues that affect physician participation in an immunization program, we 

surveyed 669 physicians practicing in five States that were already providing free 

vaccines to private physicians to immunize all children in their States. To put 

physician responses in context with their State policies, we sumeyed immunization 

program officials in 11 of the 12 universal States. We then interviewed immunization 

program officials from 21 non-universal States. We gathered our data in August and 

September 1994, the two months immediately preceding the programs start-up date, 

FINDINGS 

Paperwork requhments could dikcoumge some physkians @m pam”tipting in the WC 

P~ 

Fifty-two percent (135 of 260) of the physicians we surveyed said paperwork 

requirements in their universal State programs were excessive. However, their 

i 
universal programs only required one form. Under the VFC program, physicians have 

to complete three one-page forms. Sixteen percent of the physicians we surveyed said 

they do not expect to enroll in the VFC program due to excessive paperwork 

requirements. Physicians also said two forms, Provider Profile Form and Patient 

Eligibility Screening Record, provide unreliable information. 

Ii vaccine deliwy systermcod dhcoumge physichn participation 

Thirty-eight percent (38 of 101) of the physicians from States with drop points and 31 

percent (49 of 159) of the physicians from States with direct delivery systems 

complained about the efficiency of their State delivery systems. If physicians 

participating in the VFC program experience similar vaccine delivery problems, they 

may drop out of the VFC program. 

Luck of vaccine &livery systems in some States h. physician partic@ation 

According to VFC legislation, Federal funds are to finance delivery of program 

vaccines. However, only one vaccine manufacturer would agree to a delivery contract 

at the federally capped vaccine price. As a result, no Federal delivery system has 

been established, and CDC continues to explore other delivery options. Thirty-five 

States have established their own delivery systems for private providers, and at least 

ten of the remaining fourteen States reported they plan to do so this year. All States 

are delivering vaccines to the public sector. 

Nwly emablirhed maxiiwm allbwabli vaccine a&nh&ration fees for physicians could 

help overcome a barrier to physiciizn pdcipatim 

Prior to the VFC program, the fees States allowed physicians to charge parents for 

administering State-purchased vaccines discouraged some physicians from participating 

in universal States. To illustrate, 25 percent (64 of 260) of the physicians we surveyed 

said the fees States allowed them to charge were inadequate. For the VFC program, 

the Health Care Financing Administration established significantly higher fees that 

physicians can charge parents for administering vaccine. The new rates are 

comparable to what physicians were charging parents to administer privatelypurchased vaccines. Thus, the fees should not be a barrier to physician participation 

in the VFC program. 

RECOMMENDATIONS 

The CDC should continue to develop an efficient and reliable vaccine accountability 

mechanism. The CDC officials said they are presently reexamining other ways to 

obtain information intended to be provided by the provider profile. We encourage 

CDC to continue this effort, and also examine the efficacy of the Patient Eligibility 

Screening Record in universal States. 

ii 
The CDC should continue to explore alternative delivexy systems and should examine 

the efficiency of both drop-point and direct delivery systems. Physicians we surveyed 

described problems with both types of delivery systems. 

AGENCY COMMENTS 

The Assistant Secretary for Health commented on our draft report and concurred with 

our recommendations. He expressed CDC’S concerns that the accountability system 

for the VFC program balance the need for accountability with the need for a system 

that encourages physician participation and reported that CDC is continuing to 

develop accountability systems. Further, he stated that CDC is committed to 

establishing a delivery system for States who do not choose to deliver vaccines 

themselves. 

The Assistant Secretary for Health, the Health Care Financing Administrator, and the 

Assistant Secretary for Planning and Evaluation provided additional points of 

clarification and technical comments which we responded to by editing portions of the 

report. 

... 

111 
TABLE OF CONTENTS 

PAGE 

=KxJmvE suMMARy 

-OIXKI’ION.
 . . ............... ........ ... .. ........ ....... ...1 

FINDINGS 

Paperwork Requirements . . . . . . . . . . . . . . . . . . . .

. . . . . . ..,.OO
 . . . . . . . . . . . 6


Inefficient Vaccine DeliveVSystems . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ...8


Lack of Vaccine DeliveVSystems In Some States . . . . . . . . . . . . . . . . . . . . . . . . 9
 . .


Newly Established Maximum Alowable Vaccine 

Administration Fees . . . . . . . . . . . . . . . . . . . . . .


. . . . . . . . . . . . . . . . . . . . . . . . . . 9


RE~MMENDmoNs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ...11


APPENDICES 

Criteria for Selecting States For Physician Sumey . . . . . . . . . . . . . . . . . . . . . . . . A-1


Physician Enrollment Form, Protider Profile Form, and Patient


Eligibility Screening Record . . . . . . . . . . . . . . . . . . . . . .

. . . . . . . . . . . . .-.$O
 . B-1


Vaccine Usage Report . . . . . . . . . . . . . . . . . . . . . . 

. . . . . . . . . . . . . . . . . . . . . . c-l 

Maximum Vaccine Administration Fees By State . . . . . . . . . . . . . . . . . . . . . . . . D-1


Agency Comments . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . ..O E-1

INTRODUCTION 

PURPOSE 

To identify issues affecting physician participation in the Vaccines for Children 

program. 

BACKGROUND 

Millions of American children are at risk of severe illness and possible death from


childhood diseases such as measles, mumps, rubella, polio, diphtheria, pertussis,


tetanus, hemophilus b influenza, and hepatitis B. The Advisory Committee on


Immunization Practices and the American Academy of Pediatrics regularly issue


guidelines to health care providers on scheduling childhood immunizations. They


currently recommend that all children complete a schedule of vaccinations by 18


months of age that includes four doses of diphtheria, tetanus, and pertussis (DTP)


vaccine; three doses of oral poliovirus (OPV) vaccine; one dose of measles, mumps,


and rubella (MMR) vaccine; and a complete series of Hemophilus influenza type b


vaccine. In November 1991, the Advisory Committee also recommended three doses


of hepatitis B vaccine.


Between 1989 and 1991, several major outbreaks of measles refocused Federal


attention on childhood immunizations. The number of measles cases increased from


approximately 3,400 cases in 1988 to 28,000 cases in 1991. In response to this concern


and the need to develop a sustainable system, PHS launched the Childhood


Immunization Initiative (CII). The CII is a comprehensive approach to increase


immunization levels for children under the age of two. A major goal of the initiative


is to increase immunization levels for two-year-old children to at least 90 percent for


the most critical doses in the vaccination schedule by 1996. The initiative would


achieve this goal by improving immunization delivery services, increasing community


participation, educating parents, monitoring disease and vaccination coverage,


improving vaccines and vaccine use, and reducing the cost of vaccines.


In 1991, the number of children two years of age who had completed the


recommended immunization schedule was only about 50 percent. In 1992, this had


increased to 55 percent. In 1993, the immunization level had increased to 67 percent.


In the first quarter of 1994, the rate changed slightly to 66 percent. However, this is


still far below the national goal of 90 percent for the complete series by the year 2000.


. 

‘The Adviso~ Committee on Immunization Practices is composed of representatives from 

Federal and State health agencies, medical schools, and associations representing various health groups. 

1 
Vaccines fm Children Rqgmm 

To reduce the cost of vaccines to parents (one of the goals of the CII), Congress


authorized the Vaccines for Children program (VFC) as part of the Omnibus Budget


Reconciliation Act (OBRA) of 1993. The VFC program allows the Federal


government to purchase vaccines from manufacturers at discounted prices and provide


the vaccines free to physicians who participate in the program. Participating


physicians can use the free vaccines to immunize children enrolled for Medicaid,


Native American children, Alaskan Native American children, and children without


insurance.


Children who have insurance but the insurance does not cover immunizations


(“underinsured” children) are also eligible for VFC program vaccines, but only at


Federally Qualified Health Centers (FQHCS) or Rural Health Clinics (RHCs)~


Many State oi%cials have expressed concern that such a policy would create a barrier


to underinsured children getting immunized. They are concerned that if physicians


refer underinsured children to FQHCS or RHCS for immunizations, an opportunity to


immunize is lost. Underinsured children will go to a private physician’s office for


other health care because they have insurance coverage. When this happens, the


physician has an opportunity to screen the child’s immunization status and immunize


the child on the spot. However, if the physician refers the child to a FQHC or RHC


for immunizations, the parent may not follow-through with or may delay getting their


child immunized. Studies have shown that such missed opportunities contribute to


why children are not adequately immunized.


The VFC program began October 1, 1994, and is administered by the Centers for


Disease Control and Prevention (CDC).


P@sician Pwtici@ation 

The national goal is to increase immunization levels of 2-year-olds for specific antigens 

to 90 percent by 1996. Widespread participation of physicians in the VFC program is 

considered essential to achieve that goal. However, early in the program, medical 

societies indicated that many physicians might not be willing to participate in the VFC 

program. 

The CDC asked for assistance from the Office of Inspector General to identi& and 

describe barriers to physician participation in the VFC program. We conducted this 

study in response to that request. 

2Federally Qualified Health Centers and Rural Health Clinics serve medically underserved 

areas and rural areas that meet qualifications for receiving grants under the Public Health Service 

(PHS) Act. FQHCS include community, migrant, or homeless health centers receiving grants under the 

PHS Act. 

2 
Uizi’wsdstales 

Prior tothe VFC program, 12 States3were providing free vaccine to private 

physicians toimmunize allchildren in their States. These States are commonly 

referred to as universal States. Many universal States began their universal vaccine 

programs during the 1960s when Federal funding for State-based immunization 

programs began. 

The Federal government provides grants to all States to purchase vaccines at the 

Federal discount price and funds immunization program initiatives. These grants are 

authorized under Section 317 of the PHS Act. With the inception of the VFC 

program, universal States have additional Federal funds to purchase vaccine for their 

Medicaid, uninsured, Alaskan Native American, and Native American children. 

Universal States rely heavily on private physicians to immunize children because they 

have very limited public health clinics. Most physicians participate in their universal 

State programs. The following chart illustrates the percentage of physicians who 

participated in universal State programs in 1992. 

PHYSICIAN PARTICIPATION IN UNIVERSAL 

STATE VACCINE PROGRAMS 

PERCENT 

100 

ao 

80 

70 

@o 

60 

40 

So


20


10


0


‘M NC AK WY GTMERI SD VT MA NH


STATE 

Note Ratea are estimates provided by immunization program officials. Idaho is 

not shown beeause participation ratea were not available. 

Washington became universal in 1990, and North Carolina in 1992. This may explain, 

in part, why they do not have as high physician participation rate as the other 

3Alaska, Connecticut, Idaho, Maine, Massachusetts, New Hampshire, North Carolina, Rhode 

Island, South Dakota, Vermont, Washington, and Wyoming. 

3 
universal States. North Carolina did, however, achieve a 70 percent participation rate 

within six months after the program began. North Carolina’s success is primarily due 

to strong support from medical societies which lobbied the State legislature to fund 

the program. 

As of March 1995, three other States (New Mexico, Nevada, and North Dakota) have 

become universal. 

Non-Uiniwmil Stwes 

Most non-universal States have public health departments and clinics. In many nonuniversal States, it is common for physicians to refer children to public health 

departments for immunizations. For example, a recent study in New York showed 50 

percent of the physicians surveyed referred all or some of their patients elsewhere for 

vaccinations.4 According to the study, the primary reason for such referrals was the 

lack of insurance to cover the cost of immunizations. 

Some non-universal States have experience with distributing free vaccines to private 

physicians because they were purchasing vaccine at the Federal contract price to 

distribute to Medicaid physicians, commonly referred to as a Medicaid Replacement 

Program. State health departments purchased and distributed free vaccines to 

Medicaid physicians, and Medicaid reimbursed the State health department. Nonuniversal States also distributed free vaccines to public health clinics for childhood 

immunizations. 

METHODS 

To identify issues affecting physician participation in the VFC program, we first 

surveyed physicians practicing in universal States. We believed we could learn from 

physician experiences in those universal State programs. We asked what problems 

they had previously encountered and which features of the VFC program would 

influence their decision to participate. We then considered how the issues identified 

by physicians in universal States might affect the willingness of physicians in nonuniversal States to participate in the VFC program. (We did not survey physicians in 

non-universal States because, at the time of our survey, many of these States 

postponed notifying physicians about the VFC program due to delays in establishing a 

Federal vaccine delivery system.) 

We selected five universal States in which to conduct the physician survey-­

Washington, South Dakota, North Carolina, Massachusetts, and Connecticut. These 

States were chosen primarily because they represent different regions of the country. 

Appendix A further describes our criteria for selecting these States. 

4Nlorbidity and Mortality Weekly 

No. 1, January 13, 1995. 

Report, “Physician Vaccination Referral Practices,” Vol. 44, 

4 
In each of the States, we obtained a list of physicians from the American Board of 

Mediml Specialties' official directo~of certified specialists. From the list of 

pediatricians, family, and general practice physicians we randomly selected 150 

physicians from each State, fora sample of 750 physicians. We dropped 81 physicians 

from the sample because 30 did not give immunizations and 51 questionnaires were 

not deliverable. This reduced the sample from 750 t0669 physicians. 

Ourresponse rate was39 percent (2600f669). We are unable to perform anonrespondents analysis due to alackof demographic data inour sampling frame. Thirty 

of the physicians we surveyed returned questionnaires indicating they did not give 

immunizations because they were retired, subspecialists, in academic medicine, or did 

not treat patients two years of age or younger. We believe a large number of 

physicians may not have responded for these same reasons. It is quite likely that, for 

physicians immunizing young children, we may have a much higher response rate. In 

any event, we believe our results are informative and generally representative of 

physicians providing immunization services. 

To put physician responses in context with their State policies, we surveyed 

immunization program officials in 11 of the 12 universal States. One of the 12 

universal States chose not to participate in our survey. We conducted site visits in 

seven universal States and mailed standardized questionnaires to the remaining five 

States. 

We then interviewed immunization program officials from 21 non-universal States to 

obtain information on how they were implementing the VFC program and their 

perception of issues affecting physician participation in non-universal States. We 

interviewed the non-universal State officials at regional meetings sponsored by CDC. 

The 21 States include the District of Columbia. For the purpose of this study, we will 

refer to the District of Columbia as a State. 

To obtain an understanding of the VFC program, we interviewed officials from the 

National Immunization Program and the National Vaccine Program Office. We also 

interviewed representatives from the American Academy of Pediatrics, American 

Medical Association, and the American Academy of Family Physicians. We reviewed 

laws and implementation guidelines for the program, and reports regarding State 

vaccine programs and related subjects. 

We collected data between August and September 1994, the two months immediately 

before the program start-up date. 

This report describes (1) the effect of VFC program requirements on physician 

participation in universal States, and (2) the potential effect of these issues on 

physician participation in non-universal States. 

We conducted this inspection in accordance with the Quality Standards for Inspections 

issued by the President’s Council on Integrity and Efficiency. 

5 
reports. However, States can elect to continue requiring them, Appendix C shows an 

example of a vaccine usage report. 

The physicians we surveyed said that it is time-consuming and cumbersome to break 

down doses administered by age groups as the vaccine usage reports require. 

Physicians said they did not take the vaccine usage reports seriously and often guessed 

at the reported information. Officials in some universal States reported that some 

physicians did not comply with this requirement. 

Physicians informed us that the Provider Profile Form provides unreliable information. 

Physicians said they do not have a credible basis for estimating, by eligibility category, 

the number of children they expect to immunize. Thus, the estimates on the provider 

profile do not provide an accurate basis for States to apportion costs of vaccines 

between 317, VFC and State funds. Some State officials said they can estimate the 

number of children to be immunized better than physicians. For example, States can 

look at State Medicaid records to determine the number of Medicaid children eligible 

for program vaccines. 

The Patient Eligibility Screening Record was cited as unreliable for two reasons. First, 

the law does not require that a child’s eligibility be verified. Therefore, parents could 

misrepresent their child’s eligibility status. Second, physicians are only required to 

complete the Patient Eligibility Screening Record at the time of the first immunization. 

However, a child’s VFC eligibility status may change after the first immunization. For 

example, it is not uncommon for families to frequently go on and off Medicaid during 

the course of a child’s immunization schedule. In addition, physicians said the Patient 

Eligibility Screening Record is superfluous in universal States because they provide 

free vaccines to all children and do not have to differentiate between which children 

are eligible for VFC program vaccines. 

The Physician Enrollment Form should not be a problem for physicians who 

previously completed a similar enrollment form in their State universal program. 

Non-Uhivtmal States 

We expect that physicians in non-universal States will have similar concerns about 

paperwork as those cited by physicians in universal States. As noted earlier, fifty-two 

percent of the physicians in universal States said the paperwork in their State universal 

program was excessive (even though they were only required to complete one form for 

their State program). 

Physicians in universal States said they cannot provide reliable estimates for the 

provider profile. Physicians in non-universal States may also be unable to provide 

reliable estimates. 

Although physicians in universal States said the Patient Eligibility Screening Record 

was superfluous in universal States, this record could serve a purpose in non-universal 

7 
States. It could act as a deterrent for abuse, and provide physicians a means to 

determine if a child is eligible for VFC program vaccines. 

To further illustrate the problem of excessive paperwork, we note that paperwork was 

one reason why States did not have success in getting physician participation in their 

Medicaid vaccine replacement programs. For example, when North Carolina was a 

non-universal State they conducted a study to determine the extent of participation in 

their Medicaid replacement program. The study showed that 79 percent of the 

physicians said they did not participate in the replacement program because of 

excessive paperwork.5 

INEFFICIENT VACCINE DELIVERY SYSTEMS COULD DISCOURAGE 

PHYSICIAN PARTICIPATION 

Delivery systems generally fall into two categories. Vaccines may be delivered to a 

State depot and then shipped directly to physicians, or vaccines maybe delivered to a 

State depot and then shipped to “drop points” within a State, such as local health 

departments, clinics, and local hospitals. In drop-point systems, physicians must 

arrange to pick up vaccines from the drop points. 

WlivmalStutei$ 

Eight of the universal States we surveyed have direct delivery systems, three have


drop-point systems. In the States where we surveyed physicians, South Dakota, North


Carolina, and Massachusetts have direct delivery systems; while Washington and


Connecticut have drop-point systems. Thirty-eight percent (38 of 101) of the


respondents from States with drop points and 31 percent (49 of 159) of the


respondents from direct delivery systems complained about the efficiency of their State


delivery systems!


Physicians identified problems applicable to both direct delivery and drop-point


systems including vaccines not being delivered on time and in the correct quantities


ordered. Physicians said when such problems occur, they must turn patients away and


an opportunity to immunize is missed.


Physicians in States with drop-point systems cited additional problems including


� pick-up times at drop points are frequently inconvenient, 

� physicians or their employees must drive long distances to drop points, 

‘Garrett, J., “The Impact and Implications of Referrals to Health Departments for 

Immunizations: University of North Carolina, September, 1992. 

%here is no statistically significant difference behveen the number of complaints in drop-point 

systems and the number of complaints in direct delive~ systems. 

8 
�	 drop point employees are busy, andphysicians ortheir employees have 

experienced long waits to obtain vaccines, and 

�	 after driving long distances, and waiting for service, physicians are sometimes 

told that vaccines are not available. 

State ofilcials in States with direct delive~ systems contend direct delivery is better 

because it facilitates communication between State agencies and physicians. For 

example, they put letters, pamphlets, and new immunization schedules in with vaccine 

shipments. 

Non-Uirivemd i?htes 

The delivery of vaccines to physicians in non-universal States may present a particular 

problem for the VFC program. If physicians perceive inordinate vaccine delive~ 

problems, they may be less likely to participate, especially if children who are eligible 

for the VFC program represent a small portion of the physician’s practice. Likewise, 

if physicians experience vaccine delivery problems while participating, they may drop 

out of the program. Inefficient vaccine delivery systems not only lose the opportunity 

to immunize but can also hinder the relationship between the physician and patient. 

LACK OF VACCINE DELIVER Y SYSTEMS IN SOME STATES IMPEDES 

PHYSICIAN PARTICIPATION 

According to VFC legislation, Federal funds are to finance delivery of program 

vaccines. Only one vaccine manufacturer would agree to a delivery contract at the 

capped vaccine price, so no Federal delivery system has been established. However, 

CDC continues to explore other delivery options. 

All States are delivering vaccine to the public sector which accounts for about 50 

percent of the nation’s immunizations. For private provider delivery, as of March 30, 

1995, 35 States (including all 12 universal States) have established vaccine delivery 

systems using available Federal funding. Alaska also has a distribution system; 

however, they operate a centralized distribution system separate from the VFC 

program. At least 10 of the remaining 14 States reported they plan to begin delivering 

vaccine this year. This lack of private sector delivery has impeded private physician 

participation in these 14 States. 

NEWLY ESTABLISHED MAXIMUM ALLOWABLE VACCINE 

ADMINISTRATION FEES FOR PHYSICIANS COULD HELP OVERCOME A 

BARRIER TO PHYSICIAN PARTICIPATION 

Prior to the VFC program, physicians could charge parents a fee for administering 

free vaccines in universal States. Most universal States allowed physicians to charge 

parents from two to ten dollars per dose. Some universal States did not specify an 

amount, but told physicians they could charge parents a “reasonable” amount. The 

9 
allowable fees, however, discouraged some physicians from participating in Statesponsored programs. To illustrate, 25 percent (64 of 260) of the universal State 

physicians we surveyed said the fee their State allowed was inadequate. Twelve 

percent (31 of 260) of the physicians we surveyed said the amount physicians were 

allowed to charge parents was important to getting physician participation in the VFC 

program. 

Under the VFC program, the Health Care Financing Administration (HCFA) 

established maximum allowable vaccine administration fees that physicians in each 

State could charge parents. The maximum allowable fees represent a cap, not a 

required amount. However, if universal States adopt HCFA’S maximum allowable 

fees, physicians in universal States will be allowed to charge parents significantly more 

than they were allowed to charge previously under their State program. The 

maximum allowable fees are comparable to what physicians charge parents to 

administer privately-purchased vaccines. Therefore, the newly established rates should 

encourage physician participation in the VFC program. 

HCFA based the maximum allowable rates partly on studies done by the American 

Academy of Pediatrics (AAP). Under a HCFA contract, AAP conducted a survey of 

physicians to obtain national data on administration fees for pediatric immunizations. 

The survey showed that the average administration fee to private pay patients for each 

dose of pediatric vaccine is $15.09. The HCFA then adjusted the average rate for 

geographic cost differences to establish a maximum allowable physician fee for 

administering VFC vaccines. The maximum rates were set based on charge data 

rather than cost data which was required by law. HCFA plans to revise the maximum 

rates based on cost data. Appendix D shows, by State, the maximum fees established 

by HCFA. 

State Medicaid agencies are not obligated to set their Medicaid VFC administration 

fees at the maximum level established by HCFA. However, 13 of the 21 non-universal 

States we surveyed said they would do so, or they would establish a slightly lower fee. 

To encourage physician participation in the VFC program, several non-universal States 

are offering additional incentives. For example, one State has offered an additional $5 

to physicians for every new child they get to complete the immunization series. 

Another State plans to pay physicians $3 for each dose administered, to offset 

paperwork requirements. 

10

RECOMMENDATIONS


Physician participation in the VFC program is essential to reach the National goal to 

increase immunization levels of 2-year-olds for specific antigens to 90 percent by 1996. 

Our study showed that unreliable, burdensome accountability requirements and 

inefficient vaccine delivery systems could adversely affect a physicians’ decision to 

participate in the program. Therefore, we make two recommendations that we believe 

will further the goals of the VFC program. 

continue
 to develbp @iciknt and reliizble vaccine accountizbility rnedumiwns. 

The CDC should explore alternative means to obtain the information intended to be 

provided by the provider profile. For example, States could use Medicaid records to 

determine how many Medicaid children are eligible for VFC program vaccines. Other 

records may be readily available to determine how many uninsured, underinsured, 

Native Alaskan American, and Native American children are eligible. States could 

conduct random sample surveys of physicians to confirm these projections. The CDC 

is already reexamining how to validate the provider profile information through 

implementing a usage based system. CDC is conducting a study to evaluate methods 

of accountability for VFC vaccines based on actual vaccine usage data. We encourage 

CDC to continue these efforts. 

In addition, CDC should examine the efficacy of the Patient Eligibility Screening 

Record in universal States. These States may already have effective systems in place 

to accomplish what was intended by the Patient Eligibility Screening Record. The 

CDC has told us they are aware of this issue and are examining the legal and policy 

implications. 

Contbu4e to explore altematiw vaccine deliwy systems. 

Obviously, the lack of vaccine delivery systems to private providers in fourteen States 

impedes physician participation in the VFC program as well as the ability of the 

program to increase childhood immunizations in those States. The CDC informed us 

that they are working with interested parties to establish vaccine delivery systems. 

In addition, CDC should examine the efficiency of drop-point systems and direct 

delivery systems. Physicians we surveyed described problems with both types of 

delivery systems. If physicians experience vaccine delivery problems while 

participating, they may drop out of the program. 

11

AGENCY COMMENTS


The Assistant Secretary for Health commented on our draft report and concurred with 

our recommendations. He expressed CDC’S concerns that the accountability system 

for the VFC program balance the need for accountability with the need for a system 

that encourages physician participation and reported that CDC is continuing to 

develop accountability systems. Further, he stated that CDC is committed to 

establishing a delivery system for States who do not choose to deliver vaccines 

themselves. 

The Assistant Secretary for Health, the Health Care Financing Administrator, and the 

Assistant Secretaxy for Planning and Evaluation provided additional points of 

clarification and technical comments which we responded to by editing portions of the 

report. Appendix E shows the full text of the comments. 

12

APPENDIX A


SAMPLE OF FIVE UNIVERSAL STATES 

FOR PHYSICIAN SURVEY 

(Source STATE YELLOWBOO~ VOL. ~ No. 1, Spring 1993) 

NOTES: 

1. The sample reflects geographic and demographic diversity. 

2.	 Two New England States were selected because half of the 12 universal States 

are in that region. 

A-1

APPENDIX B 

PHYSICIAN ENROLLMENT FORM 

PROVIDER PROFILE FORM 

PATIENT ELIGIBILITY SCREENING RECORD 

B-1 
Provider Enrollment 

Vaccines for Children Program = 

Physician or Cfinic 

Address 

() () Telephone Fax 

Contact Name(s) 

Employer Identification Number 

IS your practicdctinic a Federtily Qualified He~tb Center (FQHC) or R~ He~ti CliniC (RHC)? YN 

In order to participate in the Vaccines for Children (VFC) program and/or to receive other federally procured — vaccine No provided 

tome at no COSLI, on behalf of myself and any and all practitioners associated with this medical office, group practice, Health 

Maintenance Organization, health departmen~ community/mi~atimrd clinic, or other entity of which (you are the physician-in-chief or equivalent) agree to the following: 

1.	 WC program-purchmed vaccine will be administered only to a child (48 years of age) who: (a) is on Medicaid (or 

qualifies through a State’s Medicaid waiver), or (b) has no health inswance, or (c) is an American Indian or Alaskan 

Native, or (d) has health insurance that does not pay for the vaccine (applicable only to vaccines administered by or on 

behalf of a FQHC or RHC). 

2.	 I willmaintainrecordsof the authorizedrepresentative’sresponsesfor a period of 3 years, unless State requirements call 

for a longer duration. Release of such records will be bound by the privacy protection of Federal Medicaid law. 

3. If requested, I will make such records available to the State or the Department of Health and HumaTIServices (DHHS). 

4.	 I will comply with the appropriate immunization schedule, dosage, rmd contraindications, that is established by the DHHS 

Advisory Committee on Immunization Practices, unless (a) in making a medid judgment in accordance with accepted 

medical practice, I deem such complianm to be medically inappropriate or (b) the particular requirement is not in compliance with the law of my State, including State laws relating to religious or other exempt.ions.# 

5.	 I will provide vaccine information materials and maintin records in accor~ce with the National Childhood Vaccine 

Injury Act.* 

6. I will not impose a charge for the cost of the vaccine.* 

7.	 I will not impose a charge for the adminismation of the vaccine in any amount higher than the maximum fee established by 

DHHs. 

8.	 I will not deny administration of a federally procured vaccine to a child due to the inability of the child’s parent/gutiditi 

individud of record to pay an adminiswative fee. * 

9. I will comply with the State’s requirements for ordering vaccine and other requirements as outlind on the attached 

10.	 form(s).* 

I or the State may terminate this agreement at any time for personal reasons or failure to comply with these 

requirements.* 

provider Signature 

Date 

This record is to be subrnittd to and kept on file at the State Health Department or State Public Health Agency and must be 

updated in accordance with State policy. 

*If a provld~r~elves v~~ne purchmti off f~erd contracts, but is not enrolled in the WC program, then the provider is 

only required to agree to these conditions. 

# Note: The ACIP Immunization Schedule is compatible with the AAP recommen&tions. 

For State use onty (enter date in onty one box): 

Date certified fm VFC: 

II Me certifkd for vaccine purchased off Federal conrract.s,excluding VFC: 

1 

Date MM for VW and othez vaccine purchased off Fedd contracts: 
Provider Profile 

Vaccines for Children Program @K!?%_l 

Date: 

All public and private healthcare providers approved by the State for participation in the Vaccines for Children Program (WC) 

must complete this form. This document provides shipping information and helps the State determine the amount of vaccine to 

be supplied through the VFC program. The form also maybe used to compare estimated vaccine needs with actual vaccine 

supply. The State or Immunization Project must keep this record on fde with the “Provider Enrollment” form. The Provider 

Profile form must be updated annually or more frequently if (1) estimates of children served changes, or (2) the status of the 

facility changes (e.g., private provider becomes an agent of a Federally Qualified Health Center). This form may be completed by 

one provider for the entire practice. 

A. Employer Identiilcation Number: 

B. Facility Name: 

or 

Provider Name: 

Lmt Name 

C. Contact Name(s): 

LastName 

D. Vaccine Delivery Address (no PO Boxes): 

City 

() 

Telephone 

E. Type of Facility (please check only one box): 

c1 10 Public Health Department 

o 11 Public Hospital 

o 12 Other Public 

First Name MI 

First Name Ml 

State Zipcode 

()


Fax 

Q 13 Federally Qwdified Health Center or Rural Health Clinic 

(check here ifan agent of a FQHC or RHCfor the VFC program) Cl 

20 Private Practice (Individual or Group) 

Cl 21 Private Hospital 

c1 22 Other Private 

<1 y= old 1 through 18 years Total 

F. For the 12-month period beginning 10/1/94, 

estimate the numbers of children who will receive 

vaccinations at your practice/clinic. 

G. Of the total numbers entered above, how many Note: Do not count a child in more than one category. 

children are expected to be VFC eligible because they ara 

Emolled in Medicaid 

Without health insurance 

American Indian or Ataskan Native 

Underinsured* 

Total 

‘* Complete only if E -13 above & checked (either box). 

— 

0 
Patient Eligibility Screening Record I 

Vaccines for Children Program = 

Date 

Child 

kt Name 

First Name MI 

Date of Birth 

Parent/Guardian/ 

Individual of Record 

Last Name First Name Ml 

Provider 

A record must be kept in the healthcme provider’s office that reflects the status of all children 18 years of 

age or younger, who receive immunization through the VFC program. The record may be completed by 

the parent, guardian or individual of record, or by the healt.hca.reprovider. This same record may be used 

for all subsequent visits as long as the child’s eligibility status has not changed. While verification of 

responses is not required, it is necessary to retain this or a similar record for each child receiving vaccine. 

‘II@ child qualifies for vaccination through the VFC program because hekhe (check only one box): 

(a) is enrolled in Medicaid � or

(b) does not have health insurance 

c1 or 

(c) is American Indian or Alaskan Native c1 or 

(d) has health insurance that Does Not pay for vaccines


(Applicable only to children attending a Federally Qualified Health Center c1 or


or Rural Health Clinic.)

APPENDIX C 

VACCINE USAGE REPORT 

c-1 
QUARTERLY VACCINE USAGE REPORT 

AGE-SPECIFIC DOSES ADMINISTERED 

Name of Health Care Provider I 

Quarter: [ ] 1 (Jan-Mar) 

Addres= [ 12 (Apr-June) 

[ 13 (July-Sept) 

Telephone - Year: [ 14 (Ott-Dee) 

Person Completing Report 

Enter on the appropriate line designated for each vaccine, the total number of doses given of each vaccine according to age 

groups indicated. Please DO NOT use hash marks. Use additional copies for worksheets. 

Type TOTAL DOSES GIVEN, BY PATlENT AGE-GROUP 

of 

<1 1 2 3-4 5 6-9 10-14 15-19 20-24 25-44 45-64 65 + Total Vaccine 

DTP 

DT (peals) 

‘Td (adult) ; : ,:, ~~~ :“ ,:.’ : . .,:; ““’ ;.:.::,,’; ,! ,, “: 

HibTITER 

PedvaxHIB 

OOPOVO


I.P,V,


M/M/R I 

Influenza .= 

Hep B (infant) 

This report is authorized by law (42 USC 247b. 42CPR 51 b.) and is to be submitted by the 5th working day of each quarter. 

Its submission is needed to provide effective program management and is a condition of immunization project grant awards. 

)istnbution White -tmmunizatmn Program Yellow-Provider 06-E PI-IZ.1 10 IWqrn 
PUBLIC HEALTH SERVICE (PHS) C()~ENTS ON THE OFFICE OF 

INSPECTOR GENERAL (OIG) DRAFT REPORT “PHYSICIAN PARTICIPATION 

IN THE VACCINES FOR CHILDREN PROGRAM, ” 0EI-04-93-O0320 

OIG Recommendation 

We recommend that the Centers for Disease Control and 

Prevention (CDC): 

1.	 Continue to develop efficient and reliable vaccine 

accountability mechanisms. 

PHS Response 

We concur. Financial accountability is an essential part of 

the Vaccines For Children (VFC) program. The States have 

primary responsibility for accounting for vaccine. Given


their 30 plus years of experience managing immunization


programs, the States are in the best position to account for


vaccines because of their knowledge of unique circumstances


and provider practices. 

The OIG report documents concerns that additional paperwork 

requirements will discourage physicians from participating in 

the VFC program. Because of this concern, CDC has developed 

an accountability system for the VFC program that balances the 

essential need for accountability with the mandate to 

encourage physicians to participate i.n the program. If CDC 

had required providers to report each immunization 

transaction, they would be burdened with filling out and 

sending in over 14 million pieces of paper a year. 

The CDC is continuing to develop additional accountability 

mechanisms . CDC officials have met with States to review 

State accountability plans and to identify promising 

approaching to accountability. The CDC is also working with 

Battelle to pilot test additional accountability methods in . selected States. 

Recommendation 

2. Continue to explore alternative vaccine delivery systems. 

PHS Response 

We concur. The CDC is committed to establishing a delivery 

system for those States which do not choose to deliver 

vaccines themselves. Initially, as requested bv the States, 

CDC proposed distributing vacc~ne to p~ivate ph~sicians in -

selected States through a national distribution center. 

However, the Congress preferred having the private sector 

carry out this vaccine distribution. Accordinglyf in 

September 1994, CDC began negotiations with vaccine 

— 
2


manufacturers with anticipation of delivery to private


physicians in December. On April 10, CDC had to discontinue


these negotiations. Although final agreement was reached with


one manufacturer, it was determined that time was not


available to reach agreements with the remaining


manufacturers. CDC is now holding meetings with interested


parties to determine the most appropriate manner to conduct


this vaccine delivery.


Despite this, it should be recognized that VFC vaccine is


being delivered to tens of thousands of public and private


providers. All States are delivering vaccines to public 

clinics, which account for about 50 percent of immunizations 

nationwide. In addition, as of March 30, 35 States had 

informed CDC that they were delivering vaccine to enrolled 

private providers. All of the remaining 14 States reported 

they plan to begin delivering vaccine to private providers 

this year or next year. [Alaskar which already delivers 

vaccines to all providers in the State, is not participating 

in the VFC program. ] 
‘%*Me	 TtIe Admmwataf 

Washingran. D,C, 20201 

DATE MY22 ~ 

To June GibbsBrown ~ ~ ~~ &w 

# FK)M BruceC Vhi 

Adcainistrator 

suBJEcr	 OSicoof IhspeaorGeneralDraft Reporr Thygician Paniaip4tion in the 

Vatzines for-ulikkcn Prop’ (oELcw34&q -

We *d the abmc-kced draft report whichidenm iraaa8-g phyafckm 

P** m** Weeirwa for CM&Enprugfakn,and mcomnwadsthat the Centers 

fix ~ Coaxl md ktiOII COIL$UUCm ti cffec&o AOM tO imp the 

VJK#IIOdehery syatam W. have a fewedicorhl conuB~~ whiohare attached for 

your mficw. 

Thmlkyou$orthe oppmtuity to cmunent of!thisdraft rep: 

A-eat 
.lv\, !,, (


**V ‘,


$


. DEPARTMENT OF HEALTH& HUMAN SERVICES Office of the Secretary .: 

:

Jig 7,

.0 

‘+7,,”,1,, Washington, D.C. 20201 

JUN 9 !995 

TO:	 June Gibbs Brown 

Inspector General 

FROM: Assistant Secretary 

for Planning and Evaluation .— 

SUBJECT:	 OIG Draft Report: “Physician Participation in the Vaccines for Children 

Program,” OEI-04-93-O0320 

Thank you for providing me with a draft of the above mentioned report for review and 

comment. I understand that the Public Health Service and the Health Care Financing 

Administration are also reviewing the report and will be providing your office with specific 

comments. We would defer to their expertise and experience with the VFC program in 

addressing any concerns they might have with the report. In addition, we would suggest that 

a clarification be made within the Executive Summary and the body of the report emphasizing 

that the data was collected prior to the implementation of the VFC program on October 1, 

1994. While some states may have informed their physicians about the anticipated 

requirements of the VFC program prior to October 1, 1994 other states may not have done so 

by the time data was collected. 

.’


DavidT.Ellwood


Prepared
 by Amy Nevel,OASPE