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89–373 PDF 2014

NON-VA CARE: AN INTEGRATED SOLUTION FOR 

VETERAN ACCESS 

HEARING 

BEFORE THE

OF THE

COMMITTEE ON VETERANS’ AFFAIRS 

U.S. HOUSE OF REPRESENTATIVES 

ONE HUNDRED THIRTEENTH CONGRESS 

SECOND SESSION 

Thursday June 18, 2014 

Serial No. 113–74 

Printed for the use of the Committee on Veterans’ Affairs 

( 

Available via the World Wide Web: http://www.fdsys.gov 

http://www.house.gov/reform 


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COMMITTEE ON VETERANS’ AFFAIRS 

JEFF MILLER, Chairman 

DOUG LAMBORN, Colorado 

GUS M. BILIRAKIS, Florida Vice-Chairman 

DAVID P. ROE, Tennessee 

BILL FLORES, Texas 

JEFF DENHAM, California 

JON RUNYAN, New Jersey 

DAN BENISHEK, Michigan 

TIM HUELSKAMP, Kansas 

MIKE COFFMAN, Colorado 

BRAD R. WENSTRUP, Ohio 

PAUL COOK, California 

JACKIE WALORSKI, Indiana 

DAVID JOLLY, Florida 

MICHAEL H. MICHAUD, Maine, Ranking 

Member 

CORRINE BROWN, Florida 

MARK TAKANO, California 

JULIA BROWNLEY, California 

DINA TITUS, Nevada 

ANN KIRKPATRICK, Arizona 

RAUL RUIZ, California 

GLORIA NEGRETE MCLEOD, California 

ANN M. KUSTER, New Hampshire 

BETO O’ROURKE, Texas 

TIMOTHY J. WALZ, Minnesota 

Jon Towers, Staff Director 

Nancy Dolan, Democratic Staff Director 

Pursuant to clause 2(e)(4) of Rule XI of the Rules of the House, public hearing records 

of the Committee on Veterans’ Affairs are also published in electronic form. The printed 

hearing record remains the official version. Because electronic submissions are used to 

prepare both printed and electronic versions of the hearing record, the process of converting 

between various electronic formats may introduce unintentional errors or omissions. Such occurrences are inherent in the current publication process and should diminish as the process 

is further refined. 


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C O N T E N T S 

Page 

Thursday June 18, 2014 

NON-VA Care: An Integrated Solution For Veteran Access 1 

OPENING STATEMENT 

Hon. Jeff Miller, Chairman 

Statement .......................................................................................................... 1 

Prepared Statement ......................................................................................... 2 

Hon. Michael Michaud, Ranking Member 

Statement .......................................................................................................... 4 

WITNESSES 

David J. McIntyre,Jr. President and CEO, TriWest Healthcare Alliance 

Statement .......................................................................................................... 5 

Prepared Statement ......................................................................................... 7 

Radm Thomas Carrato, USPHS (Ret) 

Statement .......................................................................................................... 13 

Prepared Statement ......................................................................................... 14 

Kris Doody, RN, MSB, FACHE 

Statement .......................................................................................................... 22 

Prepared Statement ......................................................................................... 24 

Randy Williamson, Director, Health Care, U.S. Government Accountability 

Office 

Statement .......................................................................................................... 59 

Prepared Statement ......................................................................................... 61 

Philip Matkovsky, Asst. Dep. Under Secretary for Health 

Statement .......................................................................................................... 82 

Prepared Statement ......................................................................................... 89 

APPENDIX 

STATEMENTS FOR THE RECORD ................................................ 98 

Raymond C. Kelley, Director, National Legislative Service Veterans of Foreign Wars of the United States 

Statement .......................................................................................................... 98 

GAO Highlights 100 

Letter From David J. McIntyre, Jr, CEO TriWest Healthcare Alliance 101 

Questions For the Record 101 

Letter to Hon. Sloan Gibson 101 

Statement From Hon. Michaud 101 

Questions Submitted by Ranking Member Michaud 102 

Questions to Currato From Ranking Member Michaud 105 

Responses 

Mr. Currato to Hon. Michaud 105 


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NON-VA CARE: AN INTEGRATED SOLUTION 

FOR VETERAN ACCESS 

Thursday, June 18, 2014 

U.S. HOUSE OF REPRESENTATIVES

COMMITTEE ON VETERANS’ AFFAIRS

WASHINGTON, D.C. 

The committee met, pursuant to notice, at 9:15 a.m., in Room 

334, Cannon House Office Building, Hon. Jeff Miller [chairman of 

the committee] presiding. 

OPENING STATEMENT OF CHAIRMAN JEFF MILLER 

NON–VA CARE: AN INTEGRATED 

SOLUTION FOR VETERAN ACCESS 

Wednesday, June 18, 2014 

House of Representatives 

Committee on Veterans’ Affairs 

Washington, D.C. 

The committee met, pursuant to notice, at 10:15 a.m., in Room 

334, Cannon House Office Building, Hon. Jeff Miller 

[chairman of the committee] presiding. 

Present:Representatives Miller, Lamborn, Bilirakis, 

Roe, Flores, Denham, Runyan, Benishek, Huelskamp, Coffman, 

Wenstrup, Jolly, Michaud, Brown, Takano, Brownley, Titus, 

Kirkpatrick, Ruiz, McLeod, Kuster, O’Rourke, and Walz. 

The *Chairman.* Good morning, the committee will come to 

order. Welcome to today’s full committee oversight hearing Non-VA 

Care, an Integrated Solution for Veteran Access. 

As we all know last week the Department of Veterans Affairs released the results of an internal access audit which found that 

more than 57,000 veterans have been waiting 90 days or more for 

their first VA medical appointment, and 64,000 veterans who have 

enrolled in the VA healthcare system over the last decade never received the appointment that they requested. 

To summarize, that is 121,000 veterans who have not been provided the care they have earned and the care that they deserve. 

It is unfathomable to me, and I am sure to the rest of this committee, that tens of thousands of veterans have been left without 

the healthcare they need for weeks, months, and in some cases 

years, especially considering that VA has broad, well-established, 

and long-standing authority to defer veterans to non-VA providers 

to receive needed care. 

Providing our veterans with timely accessible and high quality 

care regardless of whether or not it is provided in a VA medical faVerDate Aug 31 2005 11:41 Oct 28, 2014 Jkt 000000 PO 00000 Frm 00005 Fmt 6633 Sfmt 6633 Y:\89373.TXT PAT

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cility or through a private sector provider should be VA’s ultimate 

goal. After all isn’t non-VA care not preferable to know VA care? 

Particularly to a veteran who may be suffering and in pain and unable to receive an appointment with a VA provider for weeks, for 

months, or for even years. To me, and I know to many of our veterans as well, the answer to that question is a no-brainer to everyone but apparently the Department of Veterans Affairs. 

By allowing 121,000 veterans to languish on VA waiting lists VA 

has made it disturbingly clear that it is unwilling to utilize existing 

non-VA care authority when, where, and to the extent that it 

should to insure access to care for veteran patients. Unfortunately 

thousands of veterans have paid the price. Some even have paid 

the price with their lives. 

We cannot, and beginning now, we will not allow VA to continue 

to prioritize what may be right for the VA healthcare system, providing care to veterans at VA facilities first and foremost over what 

is being right for our veterans, and that is receiving timely access 

to needed healthcare in the most convenient an accessible manner 

possible. 

To be clear, I am in no way advocating for the dismantling of the 

VA healthcare system as some know it today. 

As one of our witnesses, Health Net federal services says in their 

testimony this morning, ‘‘The purpose of non-VA care is to augment 

VA capacity and capabilities, not to replace them; however, excuses, generalities can no longer be considered as sufficient reason 

not to provide a veteran waiting for a VA appointment or residing 

far from a VA medical facility with an authorization to receive care 

from a non-VA provider should that veteran choose to do so.’’ 

Faced with this crisis the simple fact of life is that giving access 

to non-VA care is quicker than hiring new VA staff and building 

new VA facilities. Where cultural and structural barriers prevent 

VA from insuring access to care for veterans through non-VA providers those barriers most be removed. 

VA stove pipes must be broken and bureaucratic insularity must 

be banished. To do anything less would be to dishonor the service 

and sacrifice of our veterans yesterday, today, and tomorrow. 

STATEMENT OF THE HON. JEFF MILLER, CHAIRMAN 

House Committee on Veterans’ Affairs 

‘‘Non-VA Care: An Integrated Solution for Veteran Access’’ 

June 18, 2014 

Good morning. The Committee will come to order. 

Welcome to today’s Full Committee oversight hearing, ‘‘Non-VA 

Care: An Integrated Solution for Veteran Access.’’ 

As we all know, last week the Department of Veterans Affairs 

(VA) released the results of an internal access audit, which found 

that more than fifty-seven thousand veterans have been waiting 

ninety days or more for their first VA medical appointment and 

sixty-four thousand veterans who have enrolled in the VA 

healthcare system over the last decade never received the appointment they requested. 

To summarize, that is one-hundred and twenty-one thousand veterans who have not been provided the care they have earned and 

deserve. 


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It is unfathomable to me that tens of thousands of veterans have 

been left without the health care they need for weeks, months, and 

– in some cases – years. 

Delays in care of this length and magnitude are particularly hard 

to comprehend considering that VA has broad, well-established, 

and long-standing authority to refer veterans to non-VA providers 

to receive needed care. 

Providing our veterans with timely, accessible, and high-quality 

care – regardless of whether or not such care is provided in a VA 

medical facility or through a private sector provider - should be 

VA’s ultimate goal. 

After all, isn’t non-VA care not preferable to no VA care at all? 

Particularly to a veteran who may be suffering and in pain and 

unable to receive an appointment with a VA provider for weeks or 

months or years? 

To me – and, I know, to many of our veterans as well – the answer to that question is a no-brainer to everyone but, apparently, 

the Department of Veterans Affairs. 

By allowing one-hundred and twenty-one thousand veterans to 

languish on VA waiting lists, VA has made it disturbingly clear 

that it is unwilling to utilize existing non-VA care authority when, 

where, and to the extent that it should to ensure access to care for 

veteran patients. 

Unfortunately, thousands of veterans have paid the price – some 

with their lives – for that unwillingness. 

We cannot and, beginning now, we will not allow VA to continue 

to prioritize what may be right for the VA health care system – 

providing care to veterans at VA facilities, first and foremost – over 

what is be right for our veterans – receiving timely access to needed health care in the most convenient and accessible manner possible. 

To be clear, I am in no way advocating for the dismantling of the 

VA health care system as we know it. 

As one of our witnesses, Health Net Federal Services, says in 

their testimony this morning – 

‘‘[t]he purpose of [non-VA care] is to augment VA capacity and 

capabilities, not to replace them.’’ 

However, excuses and generalities can no longer be considered a 

sufficient reason not to provide a veteran waiting for a VA appointment or residing far from a VA medical facility with an authorization to receive care from a non-VA provider, should that veteran 

choose. 

Faced with this crisis, the simple fact of life is that giving access 

to non-VA care is quicker than hiring new VA staff and building 

new VA facilities. 

Where cultural and structural barriers prevent VA from ensuring 

access to care for veterans through non-VA providers, those barriers must be removed. 

VA stovepipes must be broken and bureaucratic insularity must 

be banished. 

To do anything less would be to dishonor the service and sacrifice 

of our veterans yesterday, today, and tomorrow. 

With that I yield to the ranking member, Mr. Michaud, for any 

opening statement he may have. 


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OPENING STATEMENT OF THE HON. Mike Michaud, Ranking 

Member 

Mr. MICHAUD. Thank you very much, Mr. Chairman. 

Non-VA care has been a priority topic of this committee for many 

years. Fee-based care, vouchers, contract care, and even 

privatizations have been discussed often. With the VA’s current difficulties in providing timely access to care these discussions understandably have risen to the surface again. 

We know that there are concerns with insuring VA conduct proper coordination and continuity of care with non-VA providers. I believe we need to strike a balance between access and continuity of 

care. Unless we and Congress are willing to write a blank check 

to VA we also need to be conscience of cost effectiveness. Anecdotal 

evidence indicate that VA managers pursue for cost savings may 

have overly restricted use of non-VA care. As GAO pointed out we 

need to insure VA is taking steps to track their cost and be a good 

steward of taxpayers’ dollars. 

Last year the VA spent almost $5 billion or approximately 10 

percent of their healthcare budget to private providers; however, 

only half of this amount was for reimbursing emergency care. 

While this may be freeing up capacity in the emergency room it is 

not clear this is helping the access issue. 

Improving access requires a multi-prong approach as the hearing 

title states, non-VA care must be part of an integrated solution. 

In the short term we need to be part of other initiatives VA is 

putting in place to address the backlog, including overtime, additional clinic hours, and hiring additional providers. 

We have a number of existing models at the local level that are 

providing good care for our veterans who for various reasons can’t 

make it to VA facilities. In Maine many of my constituents in 

Aroostook County face a several hundred mile round trip drive 

with 600 miles round trip often through ice and snow to Togus VA 

Medical Center. That is why I was proud to sponsor and create the 

ARCH program to bring the program to the State of Maine. The 

program has been overwhelmingly positive. Veterans in northern 

Maine are receiving their care at Cary Medical Center in Caribou 

and I am constantly being told by my veterans that things are 

working out extremely well. 

And I want to thank Kris Doody from Cary Medical Center for 

being here this morning, look forward to your testimony this morning, and it is because of that collaborative effort that you have done 

to make sure that our veterans get access closer to home. 

The chairman’s bipartisan bill H.R. 4810 covers primary care, 

and I was happy to support this effort to address the shortfall in 

VA, but we also have to look at access to specialty care. Patient 

Centered Community Care or PC3s was originally developed to respond to specialty consultant backlog. While the initial start was 

slow a steady increase in authorization noted by the witnesses 

today is encouraging with transparency now provided by acting secretary Gibson hopefully we will see the wait times for specialty 

care quickly decline. We need to insure that VA is making full use 

of these tools across their network. 


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There are many things to be considered here today, and I caution 

that our final solutions need to insure that reimbursement rates 

are adequate to sustain a robust provider network. 

As I mentioned last week we all work for the veterans. Throughout these conversations we need to keep in mind the needs of those 

that we owe so much to. Their well meaning, the work that we do 

here in this committee have to keep veterans as a top priority. This 

is an opportunity for us really to improve access to healthcare in 

our veterans across the country, and I look forward to hear thing 

panel this morning. 

With that, Mr. Chairman, I yield back the balance of my time. 

The *Chairman.* Thank you very much for your comments. 

Joining us on our first panel today, Mr. David McIntyre Jr., the 

president and chief executive officer of TriWest Healthcare Alliance, Admiral Thomas Carrato, president of Health Net Federal 

Services, and as had already been introduced, Ms. Kris Doody, the 

chief executive officer of Cary Medical Center. Thank you all for 

being with us today. 

Mr. McIntyre, you may proceed with your statement. 

STATEMENT OF DAVID J. MCINTYRE JR. 

Mr. MCINTYRE. Thank you. 

Mr. Chairman, Ranking Member Michaud, and distinguished 

members of the committee, thank you for the opportunity to appear 

before you this morning and discuss the critical topic of access to 

healthcare for our nation’s veterans, and particularly the use of 

non-VA care as part of an integrated solution. 

I would ask that my complete written statement be accepted and 

entered into the record. 

The *Chairman.* Without objection all of your statements will be 

entered into the record. 

Mr. MCINTYRE. Thank you, sir. 

I would like to begin by acknowledging the members of the committee whose constituents were privileged to serve alone side the 

dedicated staff and providers of VA. We could not imagine a greater honor or privilege than the work in which we find ourselves currently engaged. 

Mr. Chairman and members of the distinguished committee we 

had the amazing privilege of serving at the side of the Defense Department for nearly 18 years as a corporation, providing them a relief value in 16 states that was both efficient and effective in delivering the care that they were unable to deliver themselves. And 

now we find ourselves engaged in a similar mission at the side of 

the Department of Veterans Affairs in part or all of 28 states in 

the Pacific. 

All of us associated with TriWest consider it an awesome privilege and to be engaged in this work through the VA’s new program 

called Patient Centered Community Care, or VA PC3 for short. 

Of course VA PC3 had just stood up when we all started to gain 

knowledge of the clusters of backlog care. I am pleased however to 

say that together as a team we and VA leaders from central office 

and the facilities in our geographic areas of responsibility are leanVerDate Aug 31 2005 11:41 Oct 28, 2014 Jkt 000000 PO 00000 Frm 00009 Fmt 6633 Sfmt 6633 Y:\89373.TXT PAT

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ing all the way forward at each others side to address this critical 

need in a collaborative and constructive fashion. 

If you will permit me I would like to talk for a moment about 

Phoenix, Arizona as an example of what is going on. 

While we are all focused on the sites across our regions of responsibility we all know of the serious issues that became public 

in Arizona, Phoenix in particular, a location that happens to be the 

hometown for the corporation that I am privileged to lead. 

Mr. Chairman, when the situation in Phoenix came to light we 

quickly began coordinating with VA to obtain detailed information 

regarding the backlogs in specialty care in order to learn where we 

might be able to be of assistance. We did the same for the rest of 

the sites in our regions of responsibility. 

We then took that specific information and plugged it into an analytical model that we had constructed in the days prior to analyze 

the backlog against the capacity of the network that we were responsible for constructing to determine by 15-day increment what 

we would be able to do market by market and specialty by specialty to come to the assistance of the VA. 

I am pleased to say that in Phoenix, Arizona the vast majority 

of the backlog will be able to be handled in a two-week period of 

time. Of course you have got appointing on the front end, you have 

got a variety of other responsibilities, so our commitment to Phoenix is that within 30 days of the receipt of a need for appointment 

in specialty care that we will have finished the work together with 

the providers in the community. 

That will be done properly and it will also be done at a discount 

against the fee structure, because the 4200 providers in Maricopa 

County have come to the table with that commitment. 

So you will have an appointment scheduled, the medical documentation will get back from the provider and into the veterans’ 

medical record, which is part of VA PC3, and the provider will get 

paid on time. 

We started to receive the volume of that care coming our direction and they tell us that it will rise to 3- to 400 per day coming 

our direction. 

We have done similar analysis market by market, and the pictures of it differ depending on the market and the saturation of 

networks in those particular areas. 

In addition to be able to handle that demand we have increased 

the front line staff to be able to receive the appointment requests 

and be able to manage the work. We have actually tripled our staff 

in that category in the last several weeks. They are finishing their 

training now and we have 300 people on the front lines ready to 

receive care and the care requests going forward. 

Mr. Chairman and members of the committee you should expect 

from all of us candor, openness, and collaboration, because this 

really is designed to be a team lift and to make sure that we are 

completing each others’ sentences as we go forward and make sure 

that those that have served this nation get what they have earned 

and what they are entitled to. 

It is our privilege to be here today, it is our awesome privilege 

and honor to do this work at the side of VA. This is a brand new 

program. We are tweaking and turning the pieces that need to be 


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turned, and we look forward to being a collaborative partner with 

the providers in the community, with this committee, and also with 

the VA to deliver on the responsibilities that this nation has to 

those that have sacrificed so much for our freedoms. 

Thank you, Mr. Chairman. 

PREPARED STATEMENT OF DAVID J. MCINTYRE JR. 

Mr. Chairman, Ranking Member Michaud, and distinguished 

members of the Committee, thank you very much for the opportunity to appear before you this morning to discuss the critical 

topic of access to health care for our nation’s Veterans – and, in 

particular, the use of non-VA care. 

Our History 

For 18 years, I have had the distinct privilege of leading a company whose sole mission is standing alongside the federal government in serving the health care needs of those who served this 

country in uniform and their families. In 1996, a group of non-profit health plans and university health systems came together and 

founded TriWest Healthcare Alliance. Our initial mission was to 

serve the Department of Defense (DoD) in bringing up the first 

TRICARE contract in what were then Regions 7 and 8. And while 

today TRICARE is recognized as a cherished benefit for our Service 

members and their eligible family members, it took many years of 

hard work, focus, and most importantly partnership between the 

contractor community and DoD’s health care system to mature to 

this point. I am proud of the role TriWest played, along with our 

colleagues in the contractor community, in the implementation, 

maturation, and improvement of that program during our years of 

service in support of the Defense Department. And, I am even more 

proud today to have the privilege of bringing that same focus and 

intensity to the side of the Department of Veterans Affairs (VA) 

through their new Patient Centered Community Care (PC3) program. 

In addition, we have the privilege of serving the United States 

Marine Corps as the worldwide operator of the DSTRESS stress 

and suicide-prevention contact center and the back-up to the Sexual Assault Prevention and Response (SAPR) line. We also serve 

the United State Air Force by providing appointing service in three 

Military Treatment Facilities in the Continental United States. 

Awarded PC3 Contracts for Regions 3, 5, and 6 

On September 4, 2013, TriWest was awarded a contract to serve 

VA in implementing their brand new PC3 program. I want to say 

what an honor and privilege it is to be entrusted to serve alongside 

VA in caring for our Nation’s most deserving citizens... its Veterans! Each and every member of the TriWest family feels privileged to be of service to our nation’s Veterans – from the Chairman 

of our Board (who is the President and CEO of Blue Cross Blue 

Shield of Arizona) and the rest of our 11 owners, to our senior executives, to all of our employees. 

Working with VA on implementing this new program is in many 

ways a return to our earliest days. We find ourselves partnering 

each and every day with a group of dedicated public servants, 


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working long hours to deliver the promise of access to quality 

health care to a deserving population. We knew standing up a new 

program would be challenging and consuming. But, we also knew 

that success in meeting the challenge meant we would have the 

honor of playing a part in ensuring our nation’s Veterans received 

the care they’ve earned through their service and sacrifice. Because 

of this, we embrace the opportunity to again lean all the way forward. 

Our Network, Our Focus and Our Commitment 

As I just indicated, TriWest provides a diverse set of services to 

our military and VA clients. At our core, though, TriWest is a company that builds and maintains networks of health care providers, 

who agree to render care to the deserving beneficiaries we are privileged to serve at a reasonable price for the taxpayer. We then pay 

those providers on behalf of customers quickly and accurately while 

focusing intently on professional, fair dealing as the keys to maintaining that network of high quality clinicians. 

Today, through the TriWest network, we provide Veterans with 

access to nearly 70,000 specialty providers and facilities throughout 

VA’s Regions 3, 5, and 6 and are continuing to grow those numbers 

each and every day as we learn more about their health care needs. 

Right now, the network available in our native territory, which 

consists largely of the Western and Midwestern states, contain 

more robust availability due to how much we knew about that market and our historical presence in that area supporting the DoD. 

However, we have been engaging the provider community throughout the Southern and Eastern parts of the PC3 Regions for many 

months now and are finding providers of all types willing to come 

forward and serve this most deserving population. We have committed to VA that our network will be available within the access 

standards as well as credentialed and checked against all of VA’s 

specialized quality requirements. 

PC3: Our Tasks and Our Team 

Under the terms of our contract with VA to administer the PC3 

program, TriWest is responsible for: 

Building a network of providers – This includes executing all 

contracts either in-house or in conjunction with our network subcontractors (who are indigenous to their territories of operation), 

verifying all licensure, certifications, and specialty designations as 

well as completing all credentialing work. In addition, our contract 

with VA contains a number of unique requirements for certain specialties and subspecialties that are needed by Veterans. It is our 

job to ensure those requirements are met. 

Making appointments for our Veterans; ensuring they see the 

doctor – For each authorization TriWest receives, our staff reaches 

out and attempts to make contact with the Veteran to ascertain 

their preferred time and date of appointment. We then identify a 

network provider within the standards set forth in our contract and 

reach out to that provider and make an appointment before circling 

back with the Veteran to confirm. In addition, TriWest makes efforts to ascertain the Veteran’s preferred communication method so 

that 48 hours prior to the appointment, we can send a reminder 

– lessening the potential for missed appointments and resulting in 


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the delivery of the needed care. Afterwards, we confirm that the 

appointment occurred. 

In those instances in which we cannot reach a Veteran within 

three days to make an appointment, our contract requires that we 

make an appointment for the Veteran and send a letter to him or 

her with the appointment information. We have noticed a not insignificant higher percentage of missed appointments when using the 

letter method, and have discussed this matter with VA officials. 

Following-up after appointments to retrieve medical documentation to return it to VA – Ensuring that a Veteran receives timely 

access to a high quality health care provider is certainly the most 

important element of the program. However, following the delivery 

of health care it is important to make sure that a report from the 

provider rendering the care gets returned to the Veteran’s home 

VA facility in a timely fashion so that it may be placed in the medical record of the Veteran. And, it is our responsibility to ensure 

that such occurs. This helps make certain that any findings, recommended treatments, or other important clinical services can 

occur with full knowledge of the episode of care that occurred in 

the community. 

Paying the providers’ claims – As I mentioned earlier, TriWest 

knows that without our providers, we cannot deliver care through 

the PC3 program. We realize that sometimes the federal reimbursement rates aren’t always the most attractive rate in the marketplace. However, we have learned that timely and accurate payment of claims goes a long way towards ensuring that a provider 

stays in the network and continues to see our deserving Veterans. 

Our providers are patriotic and dedicated. But, we do need to recognize their professional value by paying them on time. 

To accomplish all of this work, we rely on our dedicated team 

who work either in our corporate headquarters in Phoenix, AZ or 

our call center located in Puyallup, WA. In fact, I am pleased to 

tell the Committee that in an effort to be certain we are ready and 

able to assist VA in working down their identified backlogs for 

care, we recently doubled our front-line staff with the hiring of 100 

new employees. They will be joined by another 100 or so next week. 

All of them will be trained and ready to serve VA and our nation’s 

Veterans in the very near future, giving us the ability to meet the 

coming demand from the clusters of backlogs across our geographic 

area of responsibility. 

Non-VA Care and the First Five Months of PC3 

Implementation work ‘‘behind the scenes’’ 

As noted earlier, TriWest was awarded the PC3 contract on September 4, 2013 and we officially began implementation of the program on September 26, 2013. Most of the early work consisted of 

‘‘behind the scenes’’ efforts in coordination and cooperation with 

VA. Under our implementation plan, we would begin direct services 

to Veterans in Region 5 January 2, 2014 while rolling-out services 

to Regions 3 and 6 on April 1, 2014. 

I would like to say at this time that I regret that our implementation schedule in Region 3 needed to be pushed back from the 

original April 1 date to allow for a phased implementation through 

June 30 to allow more time to ensure that we had the right proVerDate Aug 31 2005 11:41 Oct 28, 2014 Jkt 000000 PO 00000 Frm 00013 Fmt 6633 Sfmt 6633 Y:\89373.TXT PAT

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viders available to VA when authorizations for care were sent to 

us. We had a robust network in many places throughout the Region; however, we expected to have many more providers than we 

did in some of the geographically diverse places to serve VA’s 

needs. Since that time, we have been working around the clock to 

sign up additional network providers. And, as we do so, we are constantly updating VA on a location-by-location and service-by-service 

basis so that local officials know what is available. We expect to be 

at or near completion of our initial building goals by July 1, 2014. 

And, in the midst of it all, we have now been working to address 

the clusters of backlogged care that have materialized . . . making 

the challenge a bit more complicated. 

During our ‘‘behind the scenes’’ implementation TriWest worked 

simultaneously on a number of initiatives, including: 

Ramping up our network building – While TriWest maintained 

a sizable network from our previous TRICARE work, upon award 

of the PC3 contract, we began in earnest the work required to 

amend those contracts to meet all of VA’s standards. 

Developing our TriWest/VA portal – This interactive portal system is used by VA employees to enter authorizations for care; track 

when care has been scheduled or provided; and monitor the return 

of medical documentation related to an appointment in the network. The portal is also used by TriWest staff to upload medical 

documentation in .pdf format for return to VA and also to enter 

Secondary Authorization Requests, which VA can then consider 

and approve for service in the network or appoint to its own facilities. 

Developing our TriWest Provider Portal – This interactive portal 

allows network providers who see Veterans under the PC3 program 

to view authorizations; upload medical documentation; confirm appointment timeliness; and make a Secondary Authorization Request. 

Standing up our contact center operations – In a short period of 

time we had to acquire building space, bring in Information Technology (IT) services, and hire the staff that would begin serving 

Veterans in Region 5 on January 2, 2014. 

Training hundreds of TriWest and VA staff – The PC3 program 

was not only new to TriWest and our recently-hired staff, but many 

aspects of it were also new to employees of the non-VA Care Coordination offices in VA Medical Centers (VAMC) all across the Regions. Working closely with our VA team colleagues in the Project 

Management Office, we provided unique user names and passwords for all of the VA staff at facilities across Region 5 and 

trained them of the use of the portal. 

Conducting Site Visits – On these visits, which were coordinated 

and led by our VA Project Management Office colleagues, we introduced ourselves and worked to educate VAMC staff and leadership 

on the elements of the PC3 contract and the tools we had and how 

TriWest would interact with them to serve Veterans. 

Start of direct care delivery 

On January 2, 2014, fewer than four months after award, we 

went live and began direct services to Veterans throughout Region 

5. Not surprisingly, as a new program, PC3 started slow. During 


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the first few months, we were receiving on average about 100 authorizations each day from the VAMCs we serve; although the 

daily number fluctuated from between 30–150 each day. That 

workload translated into about 2,000 authorizations for care during 

the month of January. I can state, unequivocally, that slow initial 

start is now a very distant memory for all of us in our geographic 

area of responsibility . . . TriWest and VA team alike . . . in spite of 

the short timeframe since we started delivering services. 

In February, workload inched up slightly from 2,000 to about 

2,500 for the month. For the month of May, we received 10,000 authorizations for care – a quadrupling of the monthly volume in just 

three months. And we expect the growth to continue. I will talk 

shortly about how we are preparing for that growth. 

Perhaps, as to be expected with any new program, not everything 

has gone according to plan during the first couple of months. First, 

as noted above, we know that despite our best efforts, not all of our 

network was ready in all of the places where we needed to have 

it in order to best serve VA’s and Veterans’ needs. The reasons are 

varied and several-fold: immaturity of data, complexity of contract 

requirements, Medicare-based reimbursements rates, VA’s continued provider engagement separate and distinct from the PC3 program; and lack of clarity of all of the places in which care was 

going to be needed and the volume of such care . . . exacerbated a 

bit by the current clusters of backlogged care. But, whatever the 

reasons, they are only reasons and not excuses. It is our job to have 

services available and we will meet that expectation. And, I am 

pleased to state that in spite of these initial challenges, together 

we are gaining on it. 

As you might expect, in a personnel-intense program, the rapid 

increase in workload from February to May led to some delays in 

appointing Veterans within the desired timeliness standards. Fortunately, as I noted earlier, in less than one month, we have been 

able to hire nearly 100 new staff. That growth in staffing has substantially cured those challenges. And, we will be adding another 

100 this next week. That said, I would be remiss if I did not note 

that while TriWest certainly welcomes the rapid growth in the use 

of the PC3 program, the Indefinite Delivery/Indefinite Quantity 

(IDIQ) contract design can present some unique challenges when 

such a rapid and voluminous change in demand comes into play. 

From a taxpayer-centric approach, VA does not wish to pay for 

services until after they are ordered. This is certainly understandable. And, with this contract design they do not have to. Yet, paying in arrears with little information on projected ordering volumes 

means TriWest is estimating the need for physical space and staff 

with little information or experience on all sides. As such, rapid 

growth could – and did for a bit – overwhelm TriWest’s infrastructure and staff that was built without foreknowledge of the clusters 

of backlogged care that existed. But, together, we, and the VA team 

in our geographic areas of responsibility, are persevering and I believe that we have prognosticated well enough to have a reasonable 

probability of positioning ourselves to successfully meet the demand when it arrives. 

Please know that I am in no way advocating for a change in contract design. I am only noting the importance of sharing informaVerDate Aug 31 2005 11:41 Oct 28, 2014 Jkt 000000 PO 00000 Frm 00015 Fmt 6633 Sfmt 6633 Y:\89373.TXT PAT

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tion between VA and the PC3 contractors in a design like this so 

that we can reasonably predict the workload we will be facing in 

advance and be better prepared to respond to it. And, I am pleased 

to report that VA has done a very solid job of responding to that 

need once we all got visibility of the clusters of backlogged demand 

for care. 

I would also like to note that we have received a lot of feedback 

on our TriWest/VA Portal interface tool from VA staff and our Contracting Officer. We have listened and made substantial upgrades 

and improvements in recent months. These changes will not only 

enhance productivity and efficiency inside TriWest and VA, but 

they will also provide valuable data tools for all of us to use in 

monitoring our progress and the experience of receiving care 

through the PC3 program. 

Finally, Mr. Chairman, I would like to spend a minute discussing 

how TriWest is partnering with the VA team to address the current access challenges faced by many of the VAMCs in our areas 

of geographic responsibility. 

VA has discussed publicly its Access to Care Initiative. But, before the initiative even had a name, our colleagues in many 

VAMCs around the Regions we serve were reaching out to us to see 

if we could help, and if so, where and how fast. Our company is 

headquartered Phoenix AZ. And, while I realize much remains to 

be learned and understood about actions that occurred in Phoenix, 

I can say without hesitation that the leadership there today, their 

superiors, and the Program Management Office, have been collaborating with us each and every day to hone a model of partnering 

to work down the specialty care backlogs as quickly as possible. 

They have identifying their needs for assistance so that we can reasonably identify the capacity of the providers in our network to 

handle the care. And, indeed, the analysis of demand against capacity has been conducted there and for most of the places with 

backlogs across our entire service area. And, to ensure that we can 

handle the demand in Phoenix, my team and I have spoken with 

many leaders of large practices and facilities across Maricopa 

County. And, as you would expect, they are committed to leaning 

forward to help serve their fellow citizens. In fact, we expect to be 

receiving between 300–400 authorizations of care a day from the 

Phoenix VAMC and are prepared, along with our provider network, 

to handle them all within the access standards required in our contract. 

In addition, just this past week, we began getting some of the authorizations for services needed to provide a special type of cognitive behavioral therapy. One of VA’s Psychology Chiefs is in direct communication with our head of Behavioral Health Services, 

who happens to be a Veteran himself. They are matching caseloads 

with network providers’ schedules and specialties so we can place 

Veterans with care in the community as quickly as possible with 

the right type of provider for their needs. 

I know Members of the Arizona Congressional delegation are 

rightly looking for accountability for the past, but they are also focusing intently on solutions for tomorrow—both long term and 

those that are available quickly to help Arizona Veterans. TriWest 

takes very seriously our obligation and privilege to do our part for 


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the short term as well as over the long term. I am hopeful that the 

tools we have developed and this model of information sharing and 

collaboration becomes one that we can use not only in Arizona but 

all across our Region to assist where and when we can. And, indeed, that is exactly what is underway. 

Remaining Committed and Focused 

Mr. Chairman, and members of the Committee. I hope I have 

made clear in my comments today that TriWest is very committed 

to and indeed is working tirelessly alongside VA to successfully 

execute a program that was designed to provide Veterans with 

timely access to specialty care from community providers and community facilities when asked to do so by VA Medical Centers because they are unable to meet the need. We are growing our staff 

and we are collectively beginning to smooth-out the rougher edges 

of our operations under this new program. We are adding scores of 

new providers every day to our network. And, most importantly, we 

are communicating with our VA partners every single day to understand their needs community-by-community and Veteran-byVeteran. 

We have found a tremendously dedicated VA Management Team 

overseeing this contract and matching our work hours, focus, and 

intensity every step of the way. I don’t think either of us believe 

that the other is perfect nor did we all think that we would be tested in this way. But, I want you and the rest of our fellow citizens 

to know that we have encountered a VA team that has nothing but 

the interests of our Veterans at heart, and I hope they know and 

believe the same thing about TriWest. 

Working together, and armed with an open and honest dialogue 

between us, and an intensity to match the amazing service and 

sacrifice of our collective customer, I’m confident our Veterans will 

receive the timely, quality care they deserve. 

Thank you. I will now be pleased to answer any questions that 

Committee members may have. 

The *Chairman.* Thank you very much. 

Admiral, you are recognized for five minutes. 

STATEMENT OF ADMIRAL THOMAS CARRATO 

Admiral *Carrato.* Chairman Miller, Ranking Member Michaud, 

and members of the committee, thank you for the opportunity to 

testify on the role that non-VA care, specifically the Patient Centered Community Care program, can play in increasing veterans’ 

access to care through the VA. 

In May of 2012 I had the opportunity to testify before this committee to discuss some ideas around increasing veteran access to 

healthcare services. At that time I had made three specific recommendations that apply more broadly to access to healthcare 

services. 

First augment VA medical center capacity by using short term 

solutions, such as use of contracted standby capacity that is delivered when and where assistance is needed. 

Second, VA could expand use of telephonic and web-based tools 

that offer the opportunity to reach deeper into the veteran population and to serve those in very rural or remote areas. 


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The third recommendation was to use a network of communitybased providers that would augment VA’s capacity and capability. 

Since the focus of this hearing is non-VA care I will focus today 

on the last of my three recommendations, using a network of community-based providers. This is exactly what PC3 is designed to do, 

augment VA’s ability to ensure needed specialty care is available 

to veterans when a local VA medical center cannot readily provide 

the needed care due to lack of specialists, long wait times, or geographic inaccessibility. 

Health Net was awarded a contract to provide VA with specialty 

care networks in three of the six PC3 regions. We began implementation of PC3 in our regions in January and completed implementation on April 1st of 2014. 

Today our provider network consists of approximately 39,000 

providers and continues to grow. Our network has full accreditation demonstrating excellence and meeting key quality benchmarks 

in the healthcare industry. 

From program inception through today VA has provided Health 

Net with over 31,000 authorizations for care in 71 specialty areas. 

PC3 provides many benefits to veterans and VA. The PC3 program is positioned to effectively augment VA’s capacity to ensure 

veteran access to care and do it in a way that facilitates the delivery of integrated care. It is a program that ensures high clinical 

quality, access within standards, provides patient tracking and follow up, and insures the return of medical documentation to VA. 

These features are not necessarily present in other non-VA care options or are not as robust and proven. 

PC3 is also convenient for veterans. Upon receipt of an authorization we contact the veteran to schedule an appointment, provide 

an appointment reminder to the veteran in writing, and then follow 

up to ensures the appointment occurred. Veterans are not left to 

find qualified quality providers on their own. We believe PC3 is 

well positioned to help ensure our veterans receive timely, consistent, and integrated access to care. 

PC3 is a funded, up and running, nationwide program built upon 

a consistent set of requirements; however, it is still a very new program, and as such it is essential that lessons learned and identified 

enhancements are adopted to increase the program’s effectiveness. 

We look forward to continued collaboration with the VA to help 

ensure that our veterans have ready access to the healthcare services they need. 

Thank you for your time and I am prepared to answer any questions that you might have. 

PREPARED STATEMENT OF ADMIRAL THOMAS CARRATO 

A Partnership History 

Chairman Miller, Ranking Member Michaud and Members of the 

Committee, I appreciate the opportunity to testify on Health Net 

Federal Services’ implementation and administration to date of the 

Department of Veterans Affairs’ (VA) new non-VA care initiative, 

the Patient-Centered Community Care (PC3) program. 

Health Net is proud to be one of the largest and longest serving 

health care administrators of government and military health care 


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programs for the Department of Defense (DoD) and Department of 

Veterans Affairs (VA). Health Net, Inc.’s health plans and government contracts subsidiaries provide health benefits to more than 

five million eligible individuals across the country through group, 

individual, Medicare, Medicaid, TRICARE, and VA programs. 

For over 25 years, in partnership with DoD, Health Net has 

served as a Managed Care Support Contractor in the TRICARE 

Program. Currently, as the TRICARE North Region contractor, we 

provide health care and administrative support services for three 

million active duty family members, military retirees and their dependents in 23 states. We also deliver a broad range of customized 

behavioral health and wellness services to military service members and their families, including Guardsmen and reservists. These 

services include the worldwide Military and Family Life Counseling 

(MFLC) program providing non-medical, short-term, problem solving counseling, rapid response counseling to deploying units, victim 

advocacy services, and reintegration counseling. 

As an established partner of VA, Health Net has collaborated in 

supporting Veterans’ physical and behavioral health care needs 

through Community Based Outpatient Clinics (CBOCs) and the 

Rural Mental Health Program. We also support VA by applying 

sound business practices to achieve greater efficiency in claims auditing and recovery, and previously through claims re-pricing. The 

monies recovered through these programs are available to provide 

or enhance services to our nation’s Veterans. 

It is from this long-standing commitment to supporting service 

members, Veterans, and their families that we offer our thoughts 

on PC3 and its role as an important component toward improving 

Veterans’ timely access to care, supporting coordination of care, 

and ensuring quality of non-VA care. PC3, ultimately, supports 

greater integration of non-VA care services with the care provided 

to Veterans at a VA Medical Center (VAMC) or CBOC. 

Building Upon Lessons Learned 

In developing approaches to ensure Veterans have access to quality, coordinated care, VA has previously implemented pilot programs, such as Healthcare Effectiveness through Resource Optimization (HERO) in 2008, VA Rural Mental Health Program in 2010, 

and Project Access to Care Received Closer to Home (ARCH) in 

2011. PC3 grew out of these pilot programs and was designed 

based on lessons learned from them, as well as input from and collaboration with, key industry and legislative stakeholders, including Veteran Service Organizations and Members of Congress. 

In-Place, Integrated Solution 

PC3 has been designed as an integrated solution that ensures a 

clinical quality baseline, supports care coordination, and provides 

timely access to care for Veterans. PC3 contracts have been constructed to enhance VA care delivery by augmenting VA’s ability 

to provide inpatient and outpatient specialty care and behavioral 

health care for enrolled Veterans when the local VA Medical Center (VAMC): (1) lacks available specialists; (2) has a long wait time; 

or, (3) is an extraordinary distance from the Veteran’s home. The 

purpose of PC3 is to augment VA capacity and capabilities, not to 


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replace them. To this end, specialty care can be provided on either 

an inpatient or outpatient basis and includes mental health. 

The most important goal of PC3 is to ensure Veterans have timely access to high quality, coordinated care. Health Net’s PC3 appointment schedulers work collaboratively with Veterans to schedule appointments that meet their schedules and follow PC3 standards and industry best practices. Health Net conducts follow-up 

with providers to ensure that Veterans complete their appointments. When there is an issue with an appointment, we find out 

why and attempt to reschedule. Health Net’s PC3 staff collects and 

returns completed medical documentation to VA, which ensures VA 

has timely and complete patient care information to include in the 

Veterans’ computerized patient record within VistA (Veterans 

Health Information Systems and Technology Architecture). The result of this careful process is delivery of integrated health care 

services in a manner that is convenient for Veterans. 


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Standing Up PC3 

Following a competitive bidding process, Health Net Federal 

Services was awarded a contract for three of the six PC3 regions 

(see Figure 1). The regions supported by Health Net contain all or 

part of 37 states, the District of Columbia, Puerto Rico, and the 

U.S. Virgin Islands. Within the three regions are 13 of VA’s 21 Veterans Integrated Service Networks (VISNs) and 91 Veterans Affairs Medical Centers (VAMCs). Implementation started shortly 

after the contract was awarded on September 23, 2013. The first 

VAMCs in Health Net regions went live on January 6, 2014. Implementation of the remaining VAMCs was completed on April 1, 

2014. From program inception through June 9, 2014, VA has provided Health Net with approximately 28,000 authorizations for 

care in 71 specialty areas. The top five areas of specialty care authorized include: optometry, physical therapy, gastroenterology (to 

include colonoscopy), audiology, and podiatry. PC3 is not a mandatory program, thus, utilization across the 91 VAMCs and 13 VISNs 

has varied significantly. For example, as of June 9, 2014, three 

VISNs provided almost 60 percent of total authorizations to Health 

Net. 


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Improving Timely Access to Care 

PC3 includes strict timelines to make sure that appointments are 

scheduled and executed quickly. These requirements help reduce 

wait-times and ensure that Veterans are able to see a physician in 

a timely manner. We are committed to meeting the contract requirements for scheduling routine appointments within five days of 

receiving an authorization and scheduling care to occur within 30 

days. Urgent authorizations have an even higher standard: appointments are made within 48 hours of receiving an authorization. 

Our PC3 appointment schedulers always attempt to contact Veterans in order to collaboratively find appointment times that are 

convenient for Veterans. Distance as well as travel time are considered when offering the Veteran an appointment with providers 

within VA-defined distance standards. Veterans are called to schedule the appointment and the provider is contacted after the appointment to make sure the Veteran attended the appointment. If 

the Veteran did not attend the appointment, Health Net ensures 

the Veteran is contacted to reschedule the appointment. 

Supporting Coordination of Care 

The PC3 program achieves care coordination by requiring that 

medical documentation is returned to VA. In PC3, we collect documentation from the provider, image it into in our workflow management system (iDocs), and transfer it electronically to VA (within 

14 days for outpatient care and 30 days for inpatient care) for inclusion in the Veteran’s electronic health record. In collaboration 

with DOMA Technologies, a Veteran Owned Small Business, we 

tailored iDocs for PC3 to provide transparency and ready access to 

information by VA. The iDocs system provides VA users with secure, role based access to key information and provides transparent 

access to information. The same system is accessed by both VA and 

Health Net users. VA users can track the authorization as it progresses through a seven step process that includes appointing and 

delivery of complete medical documentation. Alternative methods of 

providing non-VA care, such as individual authorizations, may not 

yield the assurance that a Veteran has made or attended an appointment, and certainly does not ensure medical documentation 

being returned to VA electronically. 

Ensuring Quality of Non-VA Care 

Ensuring quality is an important component of PC3. Network 

providers must meet strict, VA-mandated clinical quality requirements to be accepted into the PC3 network which includes the 

Medicare Conditions of Participation (CoP) and Conditions for Coverage (CfC). In addition, Health Net’s network is URAC accredited. 

URAC accreditation is a symbol of excellence and provides key 

quality benchmarks in the health care industry. Health Net meets 

URAC’s nationally recognized standards of quality and operational 

integrity for network management, provider credentialing, quality 

management and improvement, and consumer protection. We currently have over 60,000 providers in the PC3 network across all 

three regions and continue to grow the network based on the needs 

of each VAMC. Primary care is not available through PC3, so all 

of the network providers are specialty providers. To further support 

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ical issues, we have an Oversight Committee and a Peer Review 

Committee, and a comprehensive Quality Assurance Surveillance 

Plan (QASP) that is aligned with specific contract performance objectives. 

The Path Forward 

We believe PC3 has tremendous potential to help VA deliver 

timely, coordinated, and convenient care to Veterans. PC3 is still 

a very new program. As with any new program, no matter how 

well the program requirements and design have been developed, 

areas for enhancement become apparent in the early stages the 

program. In order to ensure the success and long-term viability of 

a new program, all parties need to be able to bring forward recommendations for refinement and be willing to make appropriate 

corrections or modifications to ensure the program is effective in 

achieving its goals and objectives. We are committed to doing this 

and have already adopted a number of enhancements to make the 

program more effective and more responsive to Veteran and VAMC 

needs. We also are participating in frequent collaborative discussions with the VA Program Management Office around some potential VA refinements to the program. 

As mentioned earlier, PC3 is not a mandatory program. As an inplace program which addresses access, care coordination, and quality, PC3 is an integral part of the solution to effectively care for 

our nation’s Veterans. To fully leverage the capabilities of PC3, full 

adoption is essential. 

We stand ready to support Acting Secretary Gibson on the Accelerating Access to Care Initiative. We look forward to continuing 

our collaborative relationship with VA and to serving as a resource 

to this committee and to Congress on ways in which the highest 

quality care can be delivered to our nation’s Veterans. Thank you 

and I am available to answer any questions you may have. 

Background on Health Net, Inc. 

Health Net, Inc. (Health Net) is one of the nation’s largest publicly traded managed health care companies and is currently 

ranked #254 on the 2014 Fortune 500. Health Net’s government 

services division is one of the largest and longest performing administrators of government and military health care programs. Our 

health plans and government contracts subsidiaries provide health 

benefits to more than five million individuals across the country 

through DoD and VA, as well as group, individual, Medicare, and 

Medicaid programs. As a leader in behavioral health, Health Net 

provides behavioral health benefits to approximately five million 

individuals across the U.S. and internationally through its subsidiaries, MHN, Inc. and MHN Government Services. 

Health Net Federal Services manages several large contracts for 

the government operations division of Health Net, Inc. and is proud 

to be one of the largest and longest serving health care administrators of government and military health care programs for the DoD 

and VA. 

In partnership with DoD, Health Net Federal Services serves as 

the Managed Care Support Contractor for the TRICARE North Region, providing managed care services for three million active duty 

family members, military retirees, and dependents in 23 states. In 


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collaboration with VA, Health Net Federal Services has supported 

the physical and behavioral health needs of Veterans through 

CBOCs and the Rural Mental Health Program. Additionally, 

Health Net Federal Services also supports VA by applying sound 

business practices to achieve greater efficiency in claims auditing 

and recovery. 

Our affiliate, MHN Government Services, delivers a broad range 

of customized behavioral health and wellness services to military 

service members, their families, and Veterans. These services include military family counseling, financial counseling, rapid response counseling to deploying units, victim advocacy services, and 

reintegration counseling. 

The *Chairman.* Thank you very much Admiral. 

Ms. Doody, you are recognized for five minutes. 

STATEMENT OF KRIS DOODY 

Ms. DOODY. Thank you. 

Good morning, Committee Chairman Miller, members of the 

committee, and own congressman and ranking minority member, 

Mike Michaud. 

When I testified to the Veterans Affairs House Subcommittee 

September 2012 I was pleased to report the good news about 

Project ARCH at Cary Medical Center, our community hospital in 

Caribou, Maine. 

Now, in June of 2014 I am delighted to inform you that the good 

news just keeps getting better. 

The original goals of Project ARCH were to expand access to eligible veterans for healthcare services, including specialty care and 

hospitalization, close to home. 

Now, after nearly three years of working with Project ARCH we 

can confirm that not only can we deliver on these goals but we can 

go beyond. 

Over the past three years Cary Medical Center, working together 

with VA Project ARCH staff, have enrolled some 1,400 Veterans 

who have experienced more than 3,000 consults at our hospital. If 

we assume that these same veterans would have sought out VA 

care at Togus, our single VA hospital in Maine, hundreds of miles 

away from Caribou, travel costs alone could have exceeded 

$600,000. 

But the benefits of Project ARCH go well beyond travel savings, 

we are saving lives and improving quality of life for our Veterans 

in Northern Maine. 

Listen to what Peter Miesburger, U.S. Air Force Retired, had to 

say about Project ARCH. As Peter explains, ‘‘It is the best thing 

since peanut butter.’’ 

Peter is a 77-year-old Korean War Veteran. He suffered a broken 

hip on January 30th when he fell at his home in Caribou, but, 

thanks to Project ARCH he did not have to worry about a 250-mile 

ambulance ride. 

‘‘It was miserable outside, snowing, cold, a typical northern 

Maine winter day,’’ Peter said, a former air force firefighter who retired in 1974. ‘‘God only knows what would have happened,’’ he 

said. 


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Such trips have been the standard procedure for veterans in 

northern Maine, and given the unpredictable weather conditions 

six months out of the year those trips would be life-threatening. 

John Wallace is an army veteran and at 67 had been suffering 

with a bad knee ever since he jumped out of a helicopter in Vietnam. Project ARCH encouraged him to seek treatment and he successfully had arthroscopic knee surgery to alleviate his chronic 

knee pain. ‘‘I am feeling great, although my knee can still predict 

the weather,’’ he said. ‘‘Any veteran you talk to up here, we are all 

been very happy with the results.’’ 

These are just two of hundreds of examples of how bringing care 

closer to the home of veterans near family and friends in familiar 

surroundings can make a difference. 

Veterans are also taking advantage of preventative care such as 

colonoscopies and mammograms. 

Key to the success of Project ARCH at Cary Medical Center has 

been the long-term relationship that we have built with VA 

healthcare and in particular with Maine’s Togus Veterans Hospital. 

VA Togus, with support from Cary, opened a VA communitybased outpatient clinic, or CBOC, the first in our nation, some 27 

years ago. The clinic provides primary care in Veterans living in 

Aroostook County, Maine. 

Having the ability to work with the clinic and Togus has allowed 

veterans to remain in the VA healthcare system. This is important 

to veterans who overwhelmingly endorse VA healthcare when they 

have the chance to experience it. 

While we can speak to the remarkable success of our experience 

with Project ARCH we have also faced challenges. Being a rural, 

community hospital, we struggle with the 14-day rule. This requirement of the VA to have veterans seen by a specialist within 

14 calendar days of authorization is simply not realistic. We have 

however, dramatically reduced wait times, and because we are 

flexible are able to respond to unique circumstances, such as urgent or emergent care. 

The volume generated by Project ARCH has now allowed us to 

recruit a second full-time orthopedic surgeon and two full-time 

oncologists, a great benefit for not only the veterans but to our 

community. 

We recognize that Project ARCH is a Pilot. Some have said that 

the results that we present are anecdotal and that with only five 

locations across the nation are not high enough numbers to make 

any predictions for a national expansion. We respectfully disagree. 

We believe that Project ARCH has tremendous potential to save 

the lives of our nation’s honorable and courageous veterans, save 

millions of dollars, and ultimately advance the health status of millions of veterans nationwide. 

We urge Congress to extend Project ARCH to expand the program in other rural areas of our country where veterans live hundreds of miles from the nearest VA facility. 

Project ARCH is working. Ask our veterans in northern Maine. 

There is no doubt that veterans living in remote, frontier areas of 

our country are at a tremendous disadvantage when it comes to accessing care. Even with access to care closer to home veterans must 


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be made aware of the options and after years of staying in the 

shadows they must be encouraged to come forward. 

It takes time and effort to build the trust of veterans, many of 

whom have never approached the VA for healthcare. At Cary Medical Center we have made this a top priority and we have demonstrated that when treated with respect, gratitude, and compassion the veterans’ community will not only respond but they will 

create an unbreakable bond and reach out to their comrades who 

may be in need of care. 

We truly believe that the system we have built at Cary Medical 

Center and our relationship with VA healthcare in Togus is a 

model for the nation. We would love nothing more than to share 

our success and model with other rural areas of America. 

Thank you so much for this opportunity to present this urgent 

request for the extension of Project ARCH. It is just the right thing 

to do. 

Thank you, sir. 

PREPARED STATEMENT OF KRIS DOODY 

Good morning, Committee Chairman Miller, members of the 

committee and Maine’s own Congressman and Ranking Minority 

Member, Mike Michaud. When I testified to the Veterans Affairs 

House Subcommittee September 2012, I was pleased to report the 

good news about Project ARCH at Cary Medical Center, our community hospital in Caribou, Maine. Now, in June of 2014, I am delighted to inform you that the good news just keeps getting better. 

The original goals of Project ARCH were to expand access to eligible Veterans for healthcare services, including specialty care and 

hospitalization, close to home. Now, after nearly three years of 

working with Project ARCH, we can confirm that not only can we 

deliver on these goals but we can go beyond. 

Over the past three years Cary Medical Center working together 

with VA Project ARCH staff, have enrolled some 1,400 Veterans 

who experienced more than 3,000 consults at our hospital. If we assume that these same Veterans would have sought out VA care at 

Togus, our single VA hospital in Maine, hundreds of miles away 

from Cary, travel costs alone could have exceeded $600,000. But 

the benefits of Project ARCH go well beyond travel savings, we are 

saving lives and improving quality of life for our Veterans in 

Northern Maine. 

Listen to what Peter Miesburger, U S Air Force Retired, had to 

say about Project ARCH. As Peter explains, ‘‘It’s the best thing 

since peanut butter.’’ Peter is a 77-year old Korean War Veteran. 

He suffered a broken hip on January 30th when he fell at his home 

in Caribou, but, thanks to Project ARCH, he didn’t have to worry 

about a 250-mile ambulance ride. 

‘‘It was miserable outside, snowing, cold, a typical northern 

Maine winter day,’’ said, Peter, a former Air Force firefighter who 

retired in 1974. ‘‘God only knows what would have happened.’’ He 

said. Such trips have been the standard procedure for Veterans in 

Northern Maine and given the unpredictable weather conditions 

six months out of the year, those trips could be life-threatening. 

John Wallace is an Army Veteran and at 67 had been suffering 

with a bad knee ever since he jumped out of a helicopter in VietVerDate Aug 31 2005 11:41 Oct 28, 2014 Jkt 000000 PO 00000 Frm 00028 Fmt 6633 Sfmt 6633 Y:\89373.TXT PAT

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nam. Project ARCH encouraged him to seek treatment and he successfully had arthroscopic knee surgery to alleviate his chronic 

knee pain. ‘‘I’m feeling great, although my knee can still predict the 

weather,’’ he said. ‘‘Any veteran you talk to up here, we’ve all been 

very happy with the results.’’ 

These are just two of hundreds of examples of how bringing care 

closer to the homes of Veterans near family and friends in familiar 

surroundings can make a difference. Veterans are also taking advantage of preventative care such as colonoscopies and mammograms. 

Key to the success of Project ARCH at Cary Medical Center has 

been the long-term relationship that we have built with VA 

Healthcare and in particular with Maine’s Togus Veterans Hospital. VA Togus, with support from Cary, opened a VA Community 

Based Outpatient Clinic, the first in the nation, some 27 years ago. 

The clinic provides Primary Care for Veterans living in Aroostook 

County, Maine. Having the ability to work with the clinic and 

Togus has allowed Veterans to remain in the VA healthcare system. This is important to Veterans who overwhelmingly endorse 

VA Healthcare when they have the chance to experience it. 

While we can speak to the remarkable success of our experience 

with ARCH we have also faced challenges. Being a rural, community hospital, we struggle with the 14-day rule. This requirement 

of the VA to have the Veteran seen by a specialist within 14 calendar days of authorization is simply not realistic. We have however, dramatically reduced wait times and because we are flexible, 

are able to respond to unique circumstances, such as emergent or 

urgent care. The volume generated by Project ARCH has now allowed us to recruit a second full-time Orthopedic Surgeon and two 

full-time Oncologist/Hematologists, a great benefit for not only the 

Veterans but our community. 

We recognize that Project ARCH is a ‘Pilot’. Some have said that 

the results we are presenting are anecdotal or that with only five 

locations across the nation the numbers are not high enough to 

make any predictions for a national expansion. We respectfully disagree. We believe that Project ARCH has tremendous potential to 

save the lives of our nation’s honorable and courageous Veterans, 

save millions of dollars, and, ultimately advance the health status 

of millions of Veterans nationwide. We urge congress to extend 

Project ARCH to expand the program in other rural areas of our 

country where Veterans live hundreds of miles from the nearest VA 

facility. 

Project ARCH is working. Ask our Veterans in Northern Maine. 

There is no doubt that Veterans living in remote, frontier areas of 

our country are at a tremendous disadvantage when it comes to accessing care. Even with access to care closer to home Veterans 

must be made aware of the options and after years of staying in 

the shadows, they must be encouraged to come forward. It takes 

time and effort to build the trust of Veterans, many of whom have 

never approached the VA for healthcare. At Cary Medical Center 

we made this a top priority and we have demonstrated that when 

treated with respect, gratitude, and compassion, the Veterans community will not only respond but they will create an unbreakable 

bond and reach out to their comrades who may be in need of care. 


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We truly believe that the system we have built at Cary Medical 

Center and our relationship with VA Healthcare is a model for the 

nation. We would love nothing more than to share our success and 

model with other rural areas of America. 

Thank you so much for this opportunity to present this urgent 

request for the extension of Project ARCH. It is just the right thing 

to do. 

The *Chairman.* Thank you very much to all of our witnesses. 

We will do a five-minute round of questions. 

If we can go to your testimony, Ms. Doody, you said in your closing comments that some have said that the results of ARCH we are 

presenting are anecdotal. Who is saying that they are just anecdotal? 

Ms. DOODY. Just comments that I have heard and reviewing 

newspaper articles because they have heard from veterans. 

The *Chairman.* I guess the question is who is making those 

comments? Are they part of the status quo, they don’t want to see 

ARCH succeed? We are trying to find out who in fact doesn’t like 

this pilot program. 

Ms. DOODY. I don’t know if I can answer who does not like this 

program, I think there has been a number of folk ins the State of 

Maine who would like to see this program extended and succeed 

into the future, and comments that I have heard is that it is anecdotal because I cannot get specific information from Altarum who 

was the company that was contracted to do the review of Project 

ARCH. 

So again, I can only tell information from individual veterans as 

opposed to a summary of key indicators. 

The *Chairman.* Okay. Thanks. 

To all of you, almost a month ago VA began implementing the 

accelerated care access to care initiative and as part of the effort 

VA stated, ‘‘Where VA cannot quickly increase capacity VA is increasing the use of care in the community through non-VA care.’’ 

And so what I would like to hear from you, if you could in a very 

succinct way if possible, what, if any, communication did you receive from VA on this initiative? 

Admiral *Carrato.* I can start. 

We have been working since we began implementation very 

closely with the program management office at VA and we have 

had close collaboration with them. We have seen some increase in 

authorizations from certain places. There is not uniformity across 

the system. In fact 3 VISNs account for about 60 percent of the authorizations we see. 

So it is a continuing, ongoing collaborative conversation that will 

continue, but it is clear that the program office sees PC3 as part 

of a solution to the issue. 

The *Chairman.* Mr. McIntyre? 

Mr. MCINTYRE. Sir, with regard to the communication side of 

things the communication was swift, it was completely engaged, it 

was reached to on both sides of the street with us reaching to them 

and them reaching to us. It followed on what we were seeing with 

some clustered backlogs that were showing up before everything 

became public around Phoenix and then what followed after that. 


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Since that time and the analysis that we have collectively done 

in our geographic areas of responsibility there have been meetings 

directly will every VISN director that I have been involved in, that 

the program office has been involved in, and other underneath each 

VISN has been every VA medical center engaged in the same 

thing, and we now have all the information that we believe we 

need and they have what they need from us to be able to determine 

what our capacities look like to be able to help them so that as they 

decide what levers they will pull that they know what their options 

are in the community so that they can make informed decisions 

going forward. 

I will use Phoenix as an example. Complete engagement in that 

market from the acting director, the acting VISN director, the staff 

at the local level, and the delegation in Arizona completely involved 

across the board, and we have a collaborative relationship with the 

providers in the community, all of whom have stepped up and said 

we will take whatever we can take and need to take to expand out 

our schedules to be able to meet the need of our fellow citizens. 

The *Chairman.* Really quickly, because my time is about to expire for both TriWest and Health Net. What reception have you received from VA medical center staff throughout the implementation 

of PC3? In other words, are the staff at the VA medical centers 

aware and willing to properly utilize the PC3 program? 

Mr. MCINTYRE. You know, with any new program there is always 

fits and starts. I think if you measured it at this point the engagement is strong, it is thorough. Is it at the same level of maturity 

at every sight, the answer would be no. But those sites where we 

are having struggles we are identifying those issues to the program 

office and they are working those issues effectively. 

The *Chairman.* Admiral? 

Admiral *Carrato.* Yeah, echo most of what Mr. McIntyre said. 

I think the one lingering issue that we are facing as we are continuing to grow our network is that at some locations the VA medical centers have direct contracts with providers, and when we are 

talking to those same multi-specialty groups or health systems they 

say, well we have a contract with the VA medical center and we 

are really not being encouraged to use PC3 or to enter into those 

negotiations fully. 

So that is, getting a lot better, the communication is lot better, 

but that is one issue that continues to linger. 

The *Chairman.* Thank you, sir. 

Mr. Michaud, you are recognized. 

Mr. MICHAUD. Thank you very much, Mr. Chairman. And once 

again I would like to thank the panel. 

Ms. Doody, the VA said in their testimony that the expiration of 

the ARCH contract individual transition plans for each veteran 

participating in the ARCH program is being created. Has Cary 

been involved in that transition plan for each veteran? 

Ms. DOODY. Yes, we have, congressman. We have begun to discussions with our project officers as well as members of the VA and 

looking at how many appointments are scheduled out into the fall 

of 2014 and then what will occur next in trying to assure that the 

veterans are receiving the care prior to the expiration of ARCH. 


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Mr. MICHAUD. Okay. And what are your concerns with the expiration of the ARCH contract? 

Ms. DOODY. Well obviously Project ARCH from our perspective as 

well as the VA in Maine has been very successful, and we recognize 

although it is been a different arrangement than PC3 because it is 

a direct relationship with VA, Togus, and Maine, although contract 

with the VA health system at a federal level, it has been very successful and we recognize that it could potentially be a model for the 

nation in a VA hospital working directly with a community hospital 

within a state. 

Mr. MICHAUD. Thank you. Yes, I remember when we put forward 

the program VA actually was opposed to it. 

Ms. DOODY. Yes. 

Mr. MICHAUD. As a matter of fact this was supposed to be a 

VISN-wide program and when the VA got done with their rule 

making it narrowed it down substantially. So I am glad to see that 

it has worked out well. 

Did Cary Medical pass on the bidding contract for the PC3 program? 

Ms. DOODY. No, we did not pass. We have had some contact negotiation—contract negotiation with Health Net who would be our 

provider in our region, but we have not reached agreement. 

Mr. MICHAUD. And what is your concern with the PC3? I am 

hearing concerns about reimbursement rates. 

Ms. DOODY. Yes, we have not reached agreement on reimbursement rates, which obviously I have to be financially responsible to 

my organization, so we have not been able to reach agreement at 

this time. 

Mr. MICHAUD. Okay. And this question is for—well, actually, Mr. 

McIntyre and Carrato, I know that the PC3 program has only been 

fully implemented recently. Can you explain what about the access 

to rural or highly rural areas has been? Have either of you experienced problems? 

Admiral *Carrato.* Certainly in highly rural areas it can be challenging to develop a network of providers, and part of that reason 

is that there are medically underserved areas in this nation as you 

well know, and the VA in defining the requirements for PC3 recognized that, they defined areas as urban, rural, and very rural. 

There are also shortages of certain medical specialties regardless 

if you are rural or urban. But we have very good experience with 

other large federal programs in developing networks in rural areas 

and so far we have been fairly successful. 

As I mentioned in my statement we are continuing to grow our 

network. There are challenges, but we do have ways to address 

those. 

Mr. MCINTYRE. I would associate myself with Mr. Carrato’s remarks, but use as an example the work that we finished last night 

in Prescott in Flagstaff, Arizona, which is a place where we have 

commonly identified the fact that we need to take care closer to 

home. We signed a contract last night at 10 o’clock. 

And so, you know, the community I think is now recognizing the 

need to step forward and everybody wants to try and do the right 

thing on the provider side, and certainly that is true for the corporations that we both represent. 


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This is a big lift, it is a large geographic space, and making sure 

that we are talking together both Congress as well as the VA and 

ourselves to identify where the pockets of veterans are that we 

need to make sure that there is particularly strong lift on the private sector side is very, very valuable to making sure that we get 

the job done right. 

If there is a silver lining to the backlogs and the clusters is it 

is going force that dialogue and it is going to help us identify where 

those shortfalls are that cause particular problems against the direct care system. 

What has been striking to me is that if you look just at Phoenix, 

Arizona as one example some of the backlogs represent 10 to 15 

times what you would expect in monthly average appointments 

that have to be made downtown. 

And so that engaged conversation back and forth and the expectation of all of us that we figure out what that is about and what 

the long-term needs are going to look like will help both ourselves 

and Health Net figure out how to make sure that the capacity 

downtown will match ultimately what the demand is whether it is 

rural, highly rural, or urban. 

The *Chairman.* Dr. Roe, you are recognized. 

Mr. ROE. Thank you. 

Ms. Doody, we have a solution for your 77-year-old veteran with 

six months of bad weather. Move to Tennessee. 

Ms. DOODY. I am not sure he would take you up on it, sir. 

Mr. ROE. Well we can fix that problem. 

Really fascinating. I have read all of the testimony and one of the 

things we talked about last week was process, and part of the process of getting a veteran to non-VA care can be—there is—I saw the 

GAO about how the providers see someone and then refers that 

person to somebody else in the VA who then decides, and then 

there is a request from the VA. 

How long does all of that take before the—because the PC3 program looks like it is one—once it is up and working well would 

work extremely well and you are seeing the providers across the 

country step up. 

We had five veterans in my medical practice in one office and we 

are more than willing to step up and help take care of our fellow 

veterans. And you are looking at healthcare for only six million veterans in the country out of the 22 million or so of us that are veterans. That is not a big lift, we can do that. 

So how long does this take? Do you know by the time they get 

to you how much time is wasted doing that? 

Mr. MCINTYRE. Dr. Roe, I think that the VA probably would be 

better able to answer the first component of process, and that is 

what happens within the VA before the request for authorization 

for care actually gets to us, and they are refining those processes 

and that is what is referred to as NVCC, and that is their part of 

the process. 

They then contact us and say retired Sergeant Jones needs care, 

he has got a cardiac problem, he is in the following market, can 

you place him with a cardiologist? 

Then it is our responsibility to make sure that we contact a cardiologist that is in the network, make sure that retired Sergeant 


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Jones gets placed in that provider’s calendar, the service gets rendered, we then get the medical documentation, get it back to the 

VA, and pay the doctor for the service. That is the part of the process we do. 

Mr. ROE. How does the information get from the VA to the doctor? 

Mr. MCINTYRE. On our end the way it works is that the VA provides us with the medical documentation and medical record information that we need, then we engage with that provider because 

they are in the network. We move that information to the cardiologist that the retired sergeant would be seeing, they deliver the 

work, then we grab the medical documentation back, provide it 

back to the VA, and pay the doctor. 

I will tell you that in Phoenix, by way of example, where we have 

had very deep conversation together, the director of the facility 

said, you know, we didn’t do those parts of this process very well, 

and while we all understand the fact that there needs to be sufficient supply downtown to take care of those that can’t be cared for 

in the system, releasing people into the marketplace in an 

unstructured way carries with it the risk that the provider does not 

get what they need. 

At the end of the day the provider might not even get paid, and 

our job is to make sure that there is sufficient supply, we take care 

of the provider so that the provider will take the call the next time 

we call them. 

Mr. ROE. I think that is absolutely essential or they won’t take 

the call the next time. 

Mr. MCINTYRE. Yes, sir. You know that well. 

Mr. ROE. I know that very well. 

And, you know, there are systems out there now that are set up 

among primary—I know this is just specialty care, but this could 

be extended as you have done Ms. Doody in Maine to primary care, 

and there are multitudes of primary care groups out there that are 

ACL approved by Medicare that already meet the metrics of quality, not quantity, we talked about that, that you don’t have to reinvent the wheel. Those metrics are out there already and I think 

this could be extended to primary care, and as you said to augment 

the VA, not the replace the VA, and to help them get through these 

bumps. 

I said everyone knows when you have more patients to see that 

you can see in a day. Every doctor has had that situation where 

he needs some help, and every hospital. Ms. Doody has to worry 

about staffing up her facility. 

So would that will applicability to the primary care, your PC3 

programs? 

Mr. MCINTYRE. Yes, sir, and I would say that as people look at 

what portion of primary care cannot be handled in the direct system that it is important to also remember that the panel of primary care providers in the private sector needs to be loosely integrated with the specialty care network, or as you know as a provider you are going to end up with people getting trapped in one 

lane and not being able to seamlessly crosswalk to the other and 

we will have a complete mess. 


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If I were king for a day you would add primary care into the VA 

PC3 contracts, expect those like us that are required to build these 

to get that put in place and make that part of the downtown system work probably. 

Mr. ROE. My time has expired, but Ms. Doody, I think the ARCH 

program you set up is exemplary and I wanted to commend you for 

that. 

Ms. DOODY. Thank you very much, sir. I will share that with our 

local veterans. 

Mr. ROE. I yield back. 

The *Chairman.* Thank you, Dr. Roe. 

Ms. Kuster as a reward for being here when the gavel dropped 

you are recognized for five minutes. 

Ms. KUSTER. Thank you so much, Mr. Chairman, and thank you 

to all of you for appearing before us today. 

I am from New Hampshire where we are beginning to get into 

the process of private care in the community at Concord Hospital, 

which is in my hometown, and I am very pleased to report that the 

hospital is very pleased with their relationship, but most importantly the veterans are very pleased with the relationship. 

And so my questions today really have to do with how we can 

expand this to meet other parts of the country that—I know I frequently refer to my good colleague here, Beto O’Rourke with El 

Paso and the long, long distances that people have to travel. 

For us in the northern part of the state we have the very good 

news of opening new clinics on the Canadian border towns of Berlin and Colebrook, New Hampshire. We have the same problem 

that you have in Maine with six months of challenging weather, although it is very beautiful. 

And so my question is what could we be doing to extend this— 

these arrangements for community-based care beyond where we 

are now and meet the needs of our veterans throughout the country? 

Ms. DOODY. I can take that. 

Mr. MCINTYRE. You want to take that? 

Ms. DOODY. Yes. I think we need to be looking at models of care 

such at what we have done in Caribou, Maine as a model for the 

nation and look at what has worked well. And we have also experienced some growth pains along the way. 

The discussion earlier about how to condense time from when the 

patient is seen in the primary care office till they are actually seen 

by a specialist. We have worked through a number of the issues 

and we actually have an ARCH case manager from the VA alone 

side the VA—excuse me—a case manager for Cary Medical Center, 

their offices are side by side so they work very well together and 

they work very timely for our veterans. 

So I think what we should do as a nation is look at what is working well and replicate that in other parts of our country, and I 

think Project ARCH is one of those opportunities. 

Ms. KUSTER. And you have talked about the coordination of care, 

I think that is extremely important. 

One of my concerns is there was reference to the return of medical documentation to the VA and making sure—we have had testimony here in a previous hearing about opiate use and high dosages 


VACREP180 with DISTILLER
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and our veterans not getting the word when they change medication—pain medication, they continue to take previous medication 

and then we have had medical problems from that. So the coordination of care is a concern of mine. 

I also want to address the issue in your experience in the community care around scheduling. Obviously that is the crux of the 

matter. We have had testimony about using software from 1985. 

No wonder they are is a problem. But I would love to learn more 

about in the community care model. 

We had testimony last week that the VA experiences a 50 percent no show in some circumstances. Obviously that is not acceptable in the private sector, it is not acceptable frankly from my perspective in the public sector, but what are some of the techniques 

that you use and does that include—I learned this morning about 

the DoD has a patient portal where the patient can literally go online, schedule an appointment, refill a prescription, actually take— 

take control of their own access to healthcare in a way that is convenient and timely to them. And if you could comment on the types 

of scheduling that you use and the effectiveness and how we could 

learn from that. 

Admiral *Carrato.* Okay. Let me just comment briefly on your 

first question—— 

Ms. KUSTER. Sure. 

Admiral *Carrato.* —about how can we expand the program nationwide. 

With the Patient Centered Community Care Program, PC3, it is 

currently funded, it is currently nationwide, in fact it reaches to 

the Philippines and the Virgin Islands and Puerto Rico. 

Ms. KUSTER. Yeah. 

Admiral *Carrato.* And I think just to pick up on a comment 

that Mr. McIntyre said that we need to learn lessons, borrow from 

some of the pilots like ARCH, and to his comment about adding— 

potentially adding primary care to PC3. I think that could be helpful. 

In terms of scheduling our responsibility for scheduling appointments is with our network providers, so we have a call center that 

receives the authorization from the VA, we then reach out to the 

veteran and the provider and try and get a match on when an appointment would be convenient. The veteran also has the ability to 

reschedule the appointment. 

Ms. KUSTER. Yeah. 

Admiral *Carrato.* I think the DoD portal you are talking about 

really is focused on their direct care system and scheduling appointments within the military treatment facilities. 

So in the PC3 program we are focused on scheduling appointments downtown. And so far it is working fairly well. 

In terms of—— 

Ms. KUSTER. Do you have a reminder system—— 

Admiral *Carrato.* We do. 

Ms. KUSTER. I am sorry my time is limited, in fact I have gone 

over. 

Admiral *Carrato.* Yeah, we reach out with a letter to the veteran and if they don’t show we do follow up. 


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Just quickly on no-show rates. Our no-show rate is running 

about ten percent in the PC3 program. Just a benchmark in 

the—— 

Ms. KUSTER. It is a very helpful benchmark. 

Admiral *Carrato.* —program, TRICARE program, which I am 

familiar with, it is about a 30 percent no-show rates. 

Ms. KUSTER. Thank you very much. 

The *Chairman.* Thank you, Ms. Kuster. 

Mr. Flores for five minutes. 

Mr. FLORES. Thank you, Mr. Chairman. 

I want to thank each of you for your commitment to care for our 

veterans as well as your organizations as a whole. 

I also want to brag about the physicians in Texas for a minute 

if I can, I am going read a couple of excerpts from a press release 

that came out yesterday. 

It says, ‘‘The Texas Medical Association of Physicians are stepping up to care for U.S. veterans awaiting healthcare in the U.S. 

Department of Veterans Affairs system.’’ 

‘‘TMA this week invited private physicians across Texas to enroll 

in a TMA registry if they are willing to see veterans in their offices 

TMA will share this registry with community groups that work 

with Texas veterans and with medical directors of VA facilities in 

Texas.’’ 

‘‘American’s veterans need healthcare so TMA wants to create a 

system to connect in with Texas physicians who want to help,’’ said 

Austin I. King M.D., TMA’S president, who has already enrolled 

his practice to care for veterans. 

He noted other physicians can do so too my checking the I am 

willing to serve veterans box in TMA’s online enrollment form. 

‘‘I am saddened that our veterans have been forced to wait for 

the healthcare they need and deserve, so until the VA can solve 

this problem I, like many other Texas veterans, want to help care 

for them.’’ 

And I want to thank the TMA and Texas physicians for what 

they are doing. 

I have a fairly simple question, and I think Ms. Doody you 

touched upon it, but if I could get feedback from each of you that 

would be great. 

What has been the preliminary feedback that our veterans have 

said about healthcare outside the VA versus healthcare in the VA? 

And in particular are any veterans weary of outside VA healthcare? 

Mr. McIntyre, let us start with you. 

Mr. MCINTYRE. Sir, I believe that the feedback has been strong 

and that the complaints are very, very nominal. 

The issue is to make sure that people get placed timely, that the 

providers that we have in our networks are solid providers like the 

ones you are talking about from the great State of Texas which we 

are privileged to serve and I look forward to a conversation with 

the Texas Medical Association about where they can go to actually 

sign up, because we are that place as is Health Net. 

And then lastly, you know, I think the providers really are leaning forward and the experience that they are going to find on the 

beneficiary side is very similar to those that were found with those 

that were serving in the guard and reserve during the time of the 


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conflicts that we have been through where you had community providers stepping up at the side of the Defense Department through 

our two organizations to provide services that couldn’t be done directly by the DoD, and comments were very positive and very high 

as a supplement to the Defense Department just as they would be 

to the VA. 

Mr. FLORES. Okay, thank you. 

Admiral Carrato? 

Admiral *Carrato.* Yeah, again, echoing what Mr. McIntyre 

said, the feedback we are getting from veterans on the community 

care that they are receiving is very positive. 

Like Mr. McIntyre I review our—any grievances, appeals that we 

get in just to see how things are going. Very few. So I think it is 

a positive experience. 

Mr. FLORES. Ms. Doody you talked about it in your testimony, do 

you have any expansive comments you would like to add? 

Ms. DOODY. I too would just echo my colleagues. The feedback 

has just been phenomenal from the veterans. Caribou is their home 

and they know the providers, they know the hospital, they know 

the people who work in the hospital, so the feedback has been just 

exceptional, but at the same time they widely support the VA 

healthcare system and VA Togus. 

Mr. FLORES. Okay. I thank each of you for your feedback. The 

rest of my questions I will submit for the record and we can get 

to those later on. 

Mr. Chairman, I yield back the balance of my time. 

The *Chairman.* Thank you, Mr. Flores. 

Mr. O’Rourke, you are recognized for five minutes. 

Mr. *O’Rourke.* Thank you, Mr. Chairman. 

I guess my first question is hopefully a big or bigger picture 

question. You know, given the proportion of the failure at the VA 

I would love to know your thoughts on what the logical conclusion 

or extension of this current strategy is. 

In other words I get asked a lot at home why have the VA at 

all? Why not privatize that care? The private sector could do it better. What is missing in the VA is competition. Our veterans deserve the very best, let us not keep them in this institution that 

is not working. 

From veterans almost to a person I hear if I get in the VA I love 

the care, I am treated very, very well, the outcomes are great, don’t 

touch the VA. 

So what do you do best and what does the VA do best and five 

years down the road after we get out of this current crisis what 

will this look like? 

Mr. MCINTYRE. That is a great question and it is an honor to 

serve El Paso where I spent part of my childhood when my dad 

was in the army as a doc. 

I will tell you that I hope it does not take five years, and I think 

everybody else would echo that statement. 

My belief is that the first phase is to make sure that the program 

that the VA has invested taxpayer money in, VA PC3, is put in 

place, is matured, that the processes on the VA side are matured, 

that our processes are matured, and that together we are identifying where those pockets of veterans are that might not otherwise 


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be able to get what they need in a complete capacity through the 

direct VA system because they lack the capacity to deliver on all 

the needs, and that the VA system—yes, sir. 

Mr. *O’Rourke.* I am sorry to interrupt you but I do want to understand what you think beyond taking care of capacity issues 

when the VA is not able to see someone in a reasonable period of 

time. Are there specific kinds of care that you all would be better 

equipped to take care of? 

For example, I often think the VA is or should be better at handling PTSD or the after effects of traumatic brain injury because 

they see so many people like that as opposed to your typical health 

system or hospital. Maybe that is a VA Center of Excellence. 

Is there something on the outside that we should just move all 

appointments or consults or procedures in a given area over to the 

private sector or let the private sector compete for? 

Mr. MCINTYRE. Great question. My personal view is that it is too 

early to ask that question. Or to answer it probably a better way 

to put it. It is early to ask it, it is right to ask it, you are looking 

over the horizon line, but that we first need to get the pieces 

plugged together and then there needs to be a make by decision 

category by category and facility by facility to look at what is best 

done with taxpayer funds. 

Is it best to have the direct system provide care for four veterans 

in a particular category? Is that really necessary? Or should we 

buy that on the outside because it is more efficient and more effective? 

I believe that we are going to be in a place within the next six 

to nine months to start asking in earnest that question which you 

have asked on our end and being able to collaborate with the VA 

to help them understand what the downtown capacity looks like 

and then They in a position to make those decisions. We saw that 

happen in the Defense Department with TRICARE a long time ago. 

In Phoenix, Arizona there is no hospital anymore in the air force, 

it is a clinic, and the reason why it is a clinic is that the air force 

stepped back, asked the very question you are asking, and ultimately decided we need a platform for delivery, so don’t dismantle 

it entirely, but it made sense in Phoenix to go to a clinic. In other 

communities there are still air force hospitals. 

And so I think once we get our piece of this plugged in and it 

is matured then those questions will be able to be start—start to 

be able to be answered. 

Mr. *O’Rourke.* It also shows you how serious the situation is 

and the attention that is been drawn to it. 

You know, I have been on this committee for a year and a half 

now, this is my first year in Congress, but I have never been approached by a lobbyist. On my way into a meeting today I was who 

represents providers in the private sector in El Paso and said, we 

have a hard time getting paid, it takes us a year sometimes. We 

want to see these veterans who are not able to be seen by the VA, 

but it is going to be really hard to do this if we don’t get paid. You 

know, my client, you know, wants to work with you to see how that 

is done. 

I only have 15 seconds so very quickly is payment a problem, and 

if you could all just answer very briefly. 


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Mr. MCINTYRE. We paid quickly, we pay to 99 percent plus accuracy as we did it in TRICARE, and I will look forward to talking 

to that lobbyist before we leave today. 

Mr. *O’Rourke.* Great. 

Mr. Carrato, just really quickly. 

Admiral *Carrato.* On the claims payment issue? 

Mr. *O’Rourke.* Yes. 

Admiral *Carrato.* Yeah, I think that is one of the things that 

providers like is that we—our two organizations pay very quickly, 

accurately, and that is one of the benefits of joining our network. 

Mr. *O’Rourke.* Ms. Doody very quickly. 

Ms. DOODY. Yes, actually obviously they are speaking on behalf 

as their role as insurance providers. Having a direct relationship 

with the VA there is an issue with prompt payment. 

Mr. *O’Rourke.* Okay. We would love to follow up with you on 

that. 

Ms. DOODY. Absolutely. 

Mr. *O’Rourke.* Mr. Chairman, I yield back. 

The *Chairman.* Yeah, and thank you for clarifying that because 

I think the question is VA’s prompt payment, not the providers. 

Mr. Denham, you are recognized for five minutes. 

Mr. DENHAM. Thank you, Mr. Chairman. 

Mr. McIntyre, I am sure you have seen reports over the last few 

weeks of several different pieces of legislation that would address 

these backlogs. I know the chairman has a bill, I have a bill, I 

know there are several others out there. But basically if the VA 

can’t meet its own goals, its own guidelines then we believe that 

they should be immediately outsourcing that care so that our veterans get immediate care. 

So my question to you is what are you doing to prepare for a possible increase? 

Mr. MCINTYRE. We are already seeing an increase. Our care demand went from 2,000 in the first month to 10,000 in May, so that 

would start January through May, a 4-, 5-fold increase, and we are 

expecting a lot more demand coming our direction based on the 

backlogs and that is why we tripled our front line staff is to be able 

to handle that demand. The flow levers are put in place to be able 

to make that work. 

The notion that someone can go somewhere if we don’t individually or collectively meet the requirements is probably going to be 

a very effective cross pressure on all of us to stay focused on what 

we need to do together to make sure that people get what they 

need within the time frames and the specifications of what is necessary viewed by this committee and by the administration. 

Mr. DENHAM. Is there anything that you are lacking now or anything that you need to prepare for the future? 

Mr. MCINTYRE. No. 

Mr. DENHAM. And across the entire nation can you describe in 

greater detail the efforts that we would need to increase provider 

ship? 

Mr. MCINTYRE. I go back to what happened 18 years ago at the 

start of TRICARE and then I look at what happened at the start 

of the conflicts we are currently engaged in. 


VACREP180 with DISTILLER
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A former member of Congress who was then governor of Idaho, 

Dirk Kemp throne, called me and said, can you come to Idaho? I 

said, why? He said, you know we are getting ready to deploy the 

largest portion of a population as a guard unit of any state. I want 

to ask every lawyer to come to the table and take two of their fellow citizens. Every doctor to do the same thing. You know what 

happened? The network grew from 700 providers in Idaho to 1500 

in one month, because every community provider was willing to 

step up and just take a few. 

One of the very effective things all of you could do to be helpful 

to all of us, including the VA, but also to veterans, is when you see 

providers say will you take a couple? And at the end of the day let 

us make sure that we have got a way to catch those folks as they 

come our direction and make sure that they are in the network so 

that we really can meet the demand regardless of where a veteran 

lives. So if they live out in that really rural community then we 

have got the ability to meet their needs, and together we should 

be able to solve the same problem that got solved in Idaho as it 

related to the guard that was getting ready to deploy. They had a 

full network when they were gone for their families, and when they 

came back the same thing. 

Mr. DENHAM. As we have seen that provider network expand has 

there been an issue with participation rates due the reimbursement? 

Mr. MCINTYRE. You know we are—— 

Mr. DENHAM. Both by reimbursement rates as well as Mr. 

O’Rourke said the timing to get repaid? 

Mr. MCINTYRE. We are doing a pretty good job of being able to 

sign up providers. Like Admiral Carrato said, there is a challenge 

from time to time because some who may not really understand the 

implications could say to someone, you know, you don’t really have 

to sign up with this we will just do this contract directly that we 

currently have in place. Eventually those contracts won’t exist anymore and there needs to be a network sitting on the back end. But 

the folks in the VA are working those issues. 

We have found that for the most part providers are willing to 

step up, because as Tom said, we do pay on time, and in our case 

we have over 60,000 providers already signed up, we are working 

on a few areas to complete still as we move forward, and we are 

getting a discount against the VA structure in terms of fees with 

high quality providers. So that means that more veterans can get 

care and that the care is high quality. So we have stretched the 

VA budget. 

Mr. DENHAM. And are you working with now or have you worked 

with in the past public hospitals? 

Mr. MCINTYRE. Absolutely. In fact in many of the locations that 

we are in, public hospitals that are in, I will tell you the fastest 

network contract we have ever done was done in Phoenix two 

weeks ago, it took five days from the start of a conversation between the CEO and myself and Maricopa County and we had a 

signed contract five days later and they are now part of the delivery system, and that gets replicated across the board. 

Mr. DENHAM. Thank you, and I yield back. 

The *Chairman.* Thank you, Mr. Denham. 


VACREP180 with DISTILLER
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Ms. Brownley, you are recognized for five minutes. 

Ms. BROWNLEY. Thank you, Mr. Chairman. 

And thank the panelists for being here this morning. 

Mr. McIntyre, I wanted to ask you a question. Do you track your 

wait times? 

Mr. MCINTYRE. Absolutely. 

Ms. BROWNLEY. And how do you report those wait times to the 

VA? 

Mr. MCINTYRE. Yes. We track the information collectively about 

where we sit with regard to the appointing responsibility that we 

have and what that looks like location by location. As I said, we 

started with 2,000 authorization requests in January. 

If you look at what happened from April to May, we went from 

6,500 to 10,000 in one month. And one of the reasons why we have 

added so many line staff in the last two weeks is that we were concerned about the volume that was coming at us because we started 

to struggle a bit with that. 

We wanted to get in front of that issue and then also prognosticate forward so that we would be prepared for the clusters of 

backlogs that would be coming at us. And we are now prepared to 

handle whatever those volumes are that we are going to have to 

deal with. 

Ms. BROWNLEY. So what is your average wait time would you 

say? 

Mr. MCINTYRE. Our average wait time right now is about seven 

days to get someone to an appointment. And that is two days beyond where we want to be because our responsibility is to be at five 

days and we are digging out of the challenge of going through a 

five-fold increase in three months. 

Ms. BROWNLEY. Thank you. 

And so your measurement for success on wait time is five days 

then? 

Mr. MCINTYRE. Our responsibility is to take an authorization for 

care request from the VA for a particular veteran and in five days 

have that veteran appointed with a network provider to be seen 

within 30 days for care. 

So I talked about our wait time. That is against a five-day appointing standard. In some markets, there are not enough providers to actually deliver care against the demand that currently 

exists given the backlogs. 

And so we have been able to help the VA understand market by 

market what that will look like as they make decisions about how 

to handle the backlogs. 

Ms. BROWNLEY. So do you have that? Is that published, something that we can review to see what the wait times are from city 

to city, region by region? 

Mr. MCINTYRE. Be glad to sit with you and have a conversation 

about things that would relate to the markets that we serve. 

Ms. BROWNLEY. Thank you. 

And what about transportation? How does TriWest coordinate 

transportation and reimbursement to our veterans? 

Mr. MCINTYRE. We are not responsible for transportation directly. I will tell you that if you look to some of the markets we 


VACREP180 with DISTILLER
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are in where transportation is a greater challenge, we will engage 

directly with the VSO community and others that do transportation 

support. The VA has a structure through which they reimburse for 

transportation. 

One of the challenges we all faced in the community in Arizona 

where not only do we have a furnace of a backlog that we are all 

dealing with, but it is also hot right now, was how do we set up 

a transportation infrastructure across the city so that as veterans 

are going to get care that we don’t find them expiring at a bus stop 

waiting for a bus to get to where they need to get. 

So the VSOs have stepped up in the community, interlinked how 

that is going to work and they will get a voucher if they are unable 

to get to where they need to be in an easy fashion. And our appointing staff will be educated about how they get to that voucher 

so that they will all be able to get what they need. 

Ms. BROWNLEY. Thank you. 

And in terms of reimbursements, is TriWest being reimbursed at 

Medicare rates by the VA? 

Mr. MCINTYRE. We are paid an administrative fee to do the work 

that we do when the work shows up. That is how we get paid. And 

we are also responsible for making sure that we can build a network that has got the right quality in it, the right breadth and the 

right depth, and on the reimbursement rate to get providers signed 

up at or below the fee schedule. 

And that is an important piece because at the end of the day, if 

you can find providers that are willing to step up and take a few 

of their fellow citizens and are willing to do that at a little bit less 

than the fee schedule at its maximum level, that allows more people to get cared for in a finite budget. And that is what we are 

doing. 

And as I said and as Admiral Carrato said, we have fairly large 

networks built and others are being added. We did that work in the 

Defense Department community and we are doing it now. And we 

cross-leverage as a company the relationship of a lot of nonprofit 

Blue Cross Blue Shield plans and two university hospital systems 

with own our company. And that way, we are able to maximize the 

taxpayer dollar while delivering the highest quality access to care. 

Ms. BROWNLEY. Thank you. 

My time has expired. I yield back. 

Mr. MICHAUD. Mr. Chairman, so yes or no, are you being reimbursed at the Medicare rates? Yes or no? 

Mr. MCINTYRE. Yes. 

Mr. MICHAUD. Okay. Thank you. 

Mr. BILIRAKIS. [Presiding] No problem. 

Mr. Runyan, you are recognized for five minutes. 

Mr. RUNYAN. Thank you, Mr. Chairman. 

And I want to talk a little bit about expectations because I know, 

Mrs. Doody, you said in your testimony that 14 days is unrealistic 

and I think Mr. McIntyre just kind of backed that up with how he 

answered the previous question. 

Two questions. In normal operating procedure, what is the expectation and this in this crisis with what we know with the data that 

we can get from the VA, which I think most people agree we can’t 

really trust a lot of it right now, what would—obviously that data 


VACREP180 with DISTILLER
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would be higher with a higher volume, but all three of you, can you 

kind of set what those expectations may be? 

Ms. DOODY. Absolutely, sir. And I am sharing again from my experience with Project ARCH in my hospital. 

When I say it is unrealistic, meaning a rural community with a 

limited number of providers, as both Mr. McIntyre and Mr. Carrato 

have stated, just a physician going on vacation is going to impact 

that 14-day window. 

Also, if we have a physician who leaves in a certain specialty, 

that extends that 14-day opportunity to get the patient in to be 

seen, and it is just not realistic for that to occur. 

What we are seeing is we are able to get the patients in in a lot 

of very busy specialties, primarily orthopedic surgery, which is 

probably similar in a lot of other markets that these gentlemen are 

in. That is where the demand is the highest for some of our aging 

veterans, and we are able to get them in within 30 days. 

And, interestingly, the previous indicator in looking at getting a 

patient in to be seen by a provider was at the 30-day window. And 

from understanding doing research, the majority of the VA facilities were able to get the veteran in and be seen by a provider within the 30 days. 

So I think going forward, that is something that really should be 

investigated and see if that is another opportunity for our veterans 

to be seen in a timely manner. 

There are probably some areas or some parts of the country that 

veterans can be seen within 14 days because of the supply of physicians, but I would highly recommend that you investigate in rural 

communities, it is probably not realistic. And, again, that is from 

my experience for the last three years. 

Mr. RUNYAN. The other two of you agree with—— 

Admiral *Carrato.* Yeah, I think that is pretty consistent. You 

know, our requirement, as David mentioned, is for routine appointments within 30 days. For urgent appointments, 48 hours. But, 

again, depending on the specialty, depending on the geographic location, you can get some routine appointments in quicker than 14 

days. Some may go a bit beyond 30 days. 

The other factor is, you know, veteran choice. You know, it may 

not be convenient to have that scheduled appointment, you know, 

at two o’clock on Wednesday. They may want it a different day of 

the week. And that sometimes can impact when a routine appointment is scheduled and agreed to. 

But I think 30 days for routine appointments is a fair benchmark. 

Mr. RUNYAN. Thank you. 

Chairman, I yield back. 

Mr. BILIRAKIS. Thank you, Mr. Runyan. 

I will recognize Mr. Walz now for five minutes. 

Mr. WALZ. Thank you, Mr. Chairman. 

And, again, thank each of you for coming and providing expertise 

and a perspective, one to educate us and to the country on we are 

identifying, we are getting a diagnosis, and now the prescription 

for what happened. 


VACREP180 with DISTILLER
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I am grateful for that and this is a very important piece of this. 

And we have an opportunity to move this forward for decades to 

come. 

Mr. McIntyre, in full disclosure to everyone and on my last deployment, my family was covered under TRICARE Prime Remote 

that was administrated by TriWest. And my wife to this day claims 

it was the best service she ever got. So I tell you that in just understanding and seeing this from a deployed national guardsman on 

the implications of having private insurance, switching over to 

TRICARE, and then seeing how that was administrated. It was 

seamless and I am grateful for that. 

Mr. MCINTYRE. Sir, we are not perfect. We were honored to serve 

your family. I didn’t even know we were doing that, but we were 

honored to do it. 

And our belief is that not five years from now but a few months 

from now, we will be in that same zone of seamless operation and 

then we will be asking the kinds of questions of ourselves that your 

colleagues and others are asking and be able to mature this program the way we matured TRICARE. 

Mr. WALZ. Well, it gives me a perspective, you know, small, limited, and extrapolating from that, we have to be careful. But I 

think Mr. O’Rourke’s and other questions are being answered of 

how we go forward. 

I asked a witness last week who is making a case and I think 

what we are hearing from this, and this is fair to say, that as the 

public heard this and they were rightfully appalled by what happened, the knee jerk reaction to give them a card and let them go 

anywhere. 

This witness made the case is why is there an intermediary, why 

is there a VA or a TriWest or a Health Net in the middle. Why 

can’t they just go do this themselves. How would you respond to 

this? This witness made the case that it is an ineffective bureaucracy that can never be fixed and putting another one in there, give 

control to the veteran and you can see the appeal of this theoretically. 

My question to you is, what is your take on that and flesh out 

the details of what that means if that were the case? 

Mr. MCINTYRE. My hope is personally that the use of such a card 

will not be necessary and that if we collectively including Congress 

have an understanding of what the realities are that veterans face 

and the ability to customize this program and the VA architecture 

that at the end of the day, we will retool the system so that it is 

ready for the return of veterans who have served in these two conflicts. 

And what you refer to on the guard side is an initiative that we 

did as a company that was singularly done. It was done at our own 

expense and it was started at the encouragement of a former colleague of all of yours, Dirk Kempthorne. 

And we then stepped back and said if that works in Idaho, we 

can do that everywhere. And so we reached out to doctors all over 

the 21 states that we were responsible for at the time. And what 

we found was most were willing to take a couple of their fellow citizens. 


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And so if we know what the mapping looks like, I would say from 

primary care all the way through the most specialized specialty 

care, we should together be able to have a platform that works effectively on the VA side from a direct delivery system and downtown. 

Mr. WALZ. That is the hybrid, the best of both worlds. 

Admiral, do you concur with that? 

Admiral *Carrato.* I do. I think, you know, having a card which 

would provide the veteran with unfettered access to providers may 

sound attractive to some, but I have seen that in some systems. I 

think what we really need to do is make sure that we build an integrated, coordinated system. 

As I mentioned, our network and TriWest’s network, we fully credential the providers. We know who the quality providers are. We 

have a URAC accredited network. I think the key is to make sure 

that we augment the VA brick and mortar and it is a local decision. 

There are some that specialize in TBI, prosthetics. 

But I think using the private sector to augment that capability 

and deliver a truly integrated, coordinated healthcare experience 

for the veteran is what we need. 

Mr. WALZ. Ms. Doody, does that make sense? And you are appealing from an area that is my wheelhouse, the rural areas and 

the rural veterans. But the card doesn’t do you any good if there 

is no one there to provide the care. 

Ms. DOODY. Absolutely, sir. And I agree with my colleagues. We 

are here. Both of these programs, whether it is TRICARE and 

Health Net or what we are doing with Project ARCH, this is to 

augment the care that the VA healthcare provides. It is not to replace it. 

Mr. WALZ. Very good. Well, I thank you all for being here. 

I yield back. 

Mr. BILIRAKIS. Thank you, Mr. Walz. 

Now I will recognize Mr. Huelskamp for five minutes. 

Mr. HUELSKAMP. Thank you, Mr. Chairman. 

Gentlemen and ma’am, appreciate you being here. 

The first question I would have would be for Ms. Doody and trying to understand the Cary Medical Center. That is a hospital that 

serves not only veterans but other patients as well, is that—— 

Ms. DOODY. That is correct, sir. 

Mr. HUELSKAMP. And you obviously do receive Medicare? 

Ms. DOODY. Yes, I do. 

Mr. HUELSKAMP. What is the average reimbursement time from 

Medicare for those services? 

Ms. DOODY. Medicare would be timely. We would probably see 

reimbursement from Medicare probably within 30 days if not less. 

Mr. HUELSKAMP. Okay. And currently from the VA for services 

that we discussed here, how long? 

Ms. DOODY. That can extend out for months if not years. 

Mr. HUELSKAMP. Months if not years? 

Ms. DOODY. Yes. There is a prompt payment issue with the VA. 

Mr. HUELSKAMP. Okay. Issue on scheduling appointments with 

Medicare patients, who schedules their appointments? 

Ms. DOODY. Our individual office staff. 

Mr. HUELSKAMP. Okay. So there is no intermediary that—— 


VACREP180 with DISTILLER
43 

Ms. DOODY. No. 

Mr. HUELSKAMP. —schedules appointments? But for the veterans, who schedules their appointments? 

Ms. DOODY. We have the exact same model in place for the veterans, so there is no intermediary. We work directly with the veteran and our office staff. 

In fact, as I mentioned earlier, we are fortunate with this program to have the case managers associated with ARCH, the VA facility, and our case managers working side by side. And they are 

actually physically located at the offices. So they are physically 

present when the veteran is seen and they can schedule the patient 

right then. 

Mr. HUELSKAMP. So the veteran shows up and there is no release 

from the VA to go into the ARCH Project? 

Ms. DOODY. Yes. The VA has to provide authorization. And, 

again, it is the case manager with the VA that reviews that information from the primary care provider, does the authorization and 

forwards it on to our case managers. And that happens very timely. 

That does not take days or weeks. That sometimes can take hours. 

Mr. HUELSKAMP. The authorization for each visit or how often 

does VA have to step back in? Obviously in Medicare, that doesn’t 

occur? 

Ms. DOODY. That is correct. 

Mr. HUELSKAMP. But the VA does have to preauthorize. Describe 

a little bit more how extensive that is. I am hearing from doctors 

that every time they want to prescribe, they have to get authorization every single time. Is that not accurate? 

Ms. DOODY. That is very accurate. There can be multiple authorizations involved with a single visit. And what is difficult being in 

a non-VA facility when our provider—I am also a nurse, so knowing the history of how this works for our patients. 

When a patient is seen by a physician, the physician does diagnosing. And to diagnose, they have to receive laboratory or ancillary results back. Well, they will order those results with the intent 

of receiving those results back to get a diagnosis. They again have 

to go back to get authorization from the VA before we can go forward with that testing. So there are multiple authorizations involved. 

Mr. HUELSKAMP. Thank you. 

And, gentlemen here, is this the same type authorization requirements that you are going through the VA at certain levels for nearly every one of these type of services? 

Mr. MCINTYRE. There certainly are requirements that we have to 

meet from an authorization perspective. And we have been in the 

conversation since we started the program a couple of months ago 

on the VA PC3 side to give the VA feedback on where there are 

opportunities for refinement. 

And in some cases, those pieces of refinement have already been 

done. In other cases, things are under analysis. 

Mr. HUELSKAMP. How does that compare to TRICARE? And both 

you gentlemen, if I understand your companies, they are heavily 

involved in TRICARE as well. And describe quickly, if you could, 

how that compares. 


VACREP180 with DISTILLER
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Mr. MCINTYRE. If you go back 18 years to the start of TRICARE, 

it was similar. 

Mr. HUELSKAMP. What about today? 

Mr. MCINTYRE. Today it would be much more seamless in terms 

of how things operate. 

Mr. HUELSKAMP. And certainly Medicare is much more seamless—— 

Ms. DOODY. Yes. 

Mr. HUELSKAMP. —in terms of preauthorization. But a little 

more questions on the PC3. So you keep talking about how if providers would pick a couple veterans. What is wrong with letting the 

veterans pick a couple providers? That is how the Medicare system 

works and that is what I am confused here. 

In Medicare and rural areas, there is a capacity problem. In my 

district, they are looking for patients. I just talked with the head 

of the Kansas Hospital Association. They are begging for patients 

and the VA won’t give them patients or they make it incredibly 

burdensome. We have to create a special project called ARCH just 

for one community and have got 70 hospitals that have capacity 

issues and they don’t have enough patients. 

And they are not asking for a middle man. They are asking for 

letting the veteran pick to come in. They would be happy to serve 

them because they are waiting for reimbursement, but that becomes the problem whether they wait a year or 14 days for Medicare. 

And so if you are going to tell these folks that you are going to 

wait a year going through this cumbersome system, they are going 

to say, well—you know, veterans are saying, wait, they are going 

to pick Medicare over this particular system. 

Mr. MCINTYRE. On the private sector side through VA PC3, the 

payment rates are such—payment timeliness is such that we are 

paying within less than 30 days. 

Mr. HUELSKAMP. I appreciate that. 

Only a short time. One last thing with Ms. Doody. We have 

heard rumors that the national director of ARCH is beginning to 

ask folks like yourself to begin informing veterans that the program will be ended. 

Have they actually told you that, actually spread that message 

to our veterans? 

Ms. DOODY. No, I have not, sir. 

Mr. HUELSKAMP. Okay. Thank you. 

I yield back, Mr. Chairman. 

Mr. BILIRAKIS. Thank you. 

Dr. Ruiz, you are recognized for five minutes. 

Mr. RUIZ. Thank you very much, and thank you for being here 

today. 

In an effort to ensure veterans in my district and across the 

country receive the care that they have earned and need and when 

they need it, I have sought input from my veterans’ advisory board 

and I have listened to veterans throughout my district during our 

veterans’ initiative this past summer. 

The things that they were most concerned about include issues 

in regards to getting their medications in a timely manner that 

isn’t so cumbersome for them, how medical records can be obtained 


VACREP180 with DISTILLER
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in a more timely manner, particularly on the nights and weekends, 

by non-VA providers, and how to overcome bureaucratic red tape 

preventing VA healthcare systems from partnering with federally 

qualified health centers. 

So my first question is, how can we ensure that non-VA providers have access to veterans’ medical records on nights and weekends and also get them faster? 

When I did my overnight shifts in the emergency department, it 

was very difficult to get the EKGs or the medical records from a 

veteran that I needed to make decisions at that moment. 

So how do you address that issue and what can we do to ensure 

that those medical records are received by the non-VA providers? 

Ms. DOODY. I can tell you from our experience through Project 

ARCH we have access. It is read only. We are not able to input 

data into the VA record, but we have access to that information at 

our hospital. So that has helped with the continuity of care as you 

describe. 

As it relates to veterans receiving that information, again, with 

the close relationship of our case managers, we are able to get the 

information back to our veterans in a timely manner. In fact, we 

have to report that to the VA as part of Project ARCH. 

And also the information goes back to the Veterans Administration as soon as we receive it as a private hospital. It goes back to 

the VA, so the VA healthcare providers, whether it is the primary 

care or other specialists, are able to see the work that we do as a 

hospital and that gets inputted into their electronic medical record. 

Mr. RUIZ. Do the physicians input it into their system or do you 

input into yours, make copies, put it in electronic form, PDF or 

something, and send it back? How does that work? 

Ms. DOODY. Well, that actually from my point of view is an opportunity for improvement between the VA and the private hospital. We do have an electronic medical record and, as you know, 

the VA has an electronic medical record, but we have to print hard 

copies for the VA to insert into their record because we do not have 

access to put that information in. And we should. 

Where technology is today as it relates to electronic medical 

records, we should be making that seamless and a lot more timely 

for veterans in veterans’ hospitals and community hospitals. 

Mr. RUIZ. Okay. 

Admiral *Carrato.* And a similar answer. For routine appointments, we are able to provide the medical records from the VA to 

the provider. I think evenings or weekends or emergency, it might 

be good for us to have access at some point to the VistA system 

so we could take a look at that. And those conversations are going 

on. 

And I think the electronic interface, I know there are some demonstration sites, the VLER program, that is looking at how do they 

capture all the medical records in a unified system. I think continuing to move forward on that. 

Mr. RUIZ. In the sake of time, I am going to go to my next questions. What are the obstacles and how can we overcome them in 

order to open care for our veterans in federally qualified health 

centers? 


VACREP180 with DISTILLER
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You mentioned before that we have issues in rural areas because 

of lack of physicians, because of transportation, because of these 

other issues that the FQHCs are designed to address. 

How can we open up care with FQHCs? 

Admiral *Carrato.* I have had ongoing conversations with the 

national association representing the federally qualified healthcare 

centers. The issue with PC3 is it is largely specialty care and the 

capability of the federally qualified healthcare centers is principally 

primary healthcare. 

So we have been looking for some opportunities. They are part 

of my TRICARE network, but, again, the lack of the requirement 

for specialty care really is a matchmaker capability. 

Mr. RUIZ. In terms of prescriptions, I have veterans that tell me 

it takes too long for them to drive all the way about an hour and 

a half, two hours to the VA hospital, pick up their prescriptions. 

Sometimes they run out of their prescriptions before it is due. 

What are the obstacles in them being able to go to a pharmacy 

or go to another local clinic or hospital to use their formula? 

Admiral *Carrato.* You know, I will have to respond to the 

record for you on that one. I don’t have an answer. 

Mr. RUIZ. Okay. 

Ms. DOODY. From my experience in working with local veterans, 

we have a VA clinic that houses primary care providers for veterans, so they have access locally to talk with veteran providers. 

But a number of our rural veterans also use a mail order pharmacy, so that may be an opportunity for, you know, local veterans. 

Mr. MCINTYRE. We have set up a process in the pharmacy area 

where script can be provided on a short-term basis and then it is 

backfilled by the VA. But I think some stepping back to figure out 

how do we take the feedback that you are getting, particularly as 

a provider of care in your career before you came here, and determine between ourselves, both of our organizations and the VA, how 

can we make that work in a more seamless way when we look 

through the lens that you have got. I think that that would be very 

constructive. 

Mr. RUIZ. Well, the lens that I have that should be the lens for 

the care to our veterans is to put veterans first, to put patients 

first, to be a veteran-centered center of excellence and look through 

the lens of our veterans, not my lens, but the lens of the veterans, 

and their experiences and what we can do to address their needs. 

Mr. MCINTYRE. You bet. 

Mr. RUIZ. Thank you. 

I yield my time. 

Mr. BILIRAKIS. Thank you very much. 

I will recognize myself for five minutes. 

Why don’t I follow-up on that question with regard to prescriptions. What percentage of veterans use a mail order pharmacy and 

are they pleased with it by and large? 

Ms. DOODY. I could only tell you from limited feedback that I 

have received from veterans. The majority of the veterans that I 

work with or have been in contact with use the mail order pharmacy since we are in rural northern Maine and the feedback has 

been positive. 

Mr. BILIRAKIS. Very good. Thank you. 


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Mr. McIntyre, to assist the VA in working down their identified 

backlog for care, it is my understanding that TriWest will hire an 

additional 100 employees and an additional 100 the following week. 

What kind of system do you have in place to monitor the effectiveness of their training and ensure these employees are properly 

scheduling appointments and processing claims? 

Mr. MCINTYRE. We already have 100 people in process doing that 

work. We took our training programs, looked at them through the 

other set of lenses backwards to figure out what refinements we 

could make to shorten the training. Those folks are in the process 

of doing the easiest part of a plan as they get spooled up to be able 

to do this. And we will be measuring their performance just like 

we measure every other staff person’s performance in that critical 

work. 

Mr. BILIRAKIS. Well, what is your policy as far as disciplining or 

reprimanding an employee for not doing their job, improper scheduling or processing claims? Do you have a policy in place? 

Mr. MCINTYRE. You bet. We monitor very carefully where gaps 

are in performance. We put people on corrective action plans. If the 

issues that they worked on are viewed as a problem that can’t be 

corrected with counseling, then we will release them on the spot. 

And we found a very dedicated workforce that together with all 

of us wants to be able to serve veterans just as is true for the providers in our networks. 

Mr. BILIRAKIS. Thank you. 

A question for Mr. McIntyre and then Mr. Carrato as well. In 

both your testimonies, you mentioned that with any new program, 

no matter how well the design and preparation, areas of enhancement will be detected in early stages. So areas of enhancement, I 

will say it again, will be detected in the early stages. 

Can you share with this committee some of those challenges? 

Mr. MCINTYRE. What we have discovered is the fact that there 

needs to change some of the authorization processes that were 

being discussed previously. Those have been put on the table, the 

notion of making sure that we refine how we actually do physical 

appointing with the veterans to make sure that we are dropping 

the no-show rate even further and the way in which people come 

to understand the program itself and how it executes because that 

has changed both for the veteran but also for the VA medical center staff themselves. 

Mr. BILIRAKIS. Mr. Carrato. 

Admiral *Carrato.* Yeah, a couple of things. One is I do think 

we need to continually educate the VAMC staff on the benefits of 

the program. Mr. McIntyre alluded to some issues that our network 

providers bring to us and that is not unusual that the authorization requirement is one. 

The other issue that we have discovered and we are talking to 

the VA about is the requirement that all care go to network providers. In some situations, as an example, you don’t know what anesthesiologist is going to scrub for surgery on a given day. And that 

anesthesiologist may not be a network provider. 

So I think some allowance for a percentage of non-network providers to support our veterans. This really is the only program that 

I support that has a requirement for 100 percent network proVerDate Aug 31 2005 11:41 Oct 28, 2014 Jkt 000000 PO 00000 Frm 00051 Fmt 6633 Sfmt 6633 Y:\89373.TXT PAT

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viders. There is always an allowance for some non-net providers. 

And I think that would actually increase our ability to serve our 

veterans. 

Mr. BILIRAKIS. Very good. One last question for you, sir. 

What kind of information does VA share and/or what information 

do you have access to regarding the veterans’ process within the 

PC3 program? 

Admiral *Carrato.* Regarding the veterans’ process within the 

P—— 

Mr. BILIRAKIS. Yeah, correct. Correct. 

Admiral *Carrato.* —the internal VA process? There is sharing 

of that information and we are having ongoing conversations because I think the intent on all parties is to improve processes and 

particularly those that are impacting access to timely care. 

Mr. MCINTYRE. I would echo the same. 

Mr. BILIRAKIS. Thank you very much. Appreciate it. 

And now I will recognize Ms. Negrete McLeod. You are recognized for five minutes, ma’am. Thank you. 

Mrs. *Negrete McLeod.* Thank you, Mr. Chair. 

I think what I have gotten out of this is that your programs are 

going well. However, if we are going to allow veterans to go outside 

and get other providers and the reimbursement rate is so long in 

coming back to them, who is going to want to provide services if 

the reimburse rate is so long in taking to get back to the provider? 

Admiral *Carrato.* Well, in the program, the Patient-Centered 

Community Care program, we directly reimburse our network providers and we reimburse in 30 days or less. 

Mrs. *Negrete McLeod.* Well, yes. But you are part of a network. But if we are going to move that forward that veterans can 

go outside of the VA to get services, if the providers don’t belong 

to you, what is going to incentivize those other people to take any 

other patients if the reimbursement period is so long to get reimbursement? 

Admiral *Carrato.* Yeah, I think that is a fair question. And 

that is one of the things we hear from providers when they join our 

network. And one of the reasons they like to join our network is 

that we pay promptly. 

I think that is an issue that needs to be addressed by the VA 

which is prompt payment to providers. That is still an issue. I 

think there are solutions that could be brought to bear. 

You know, one could be that, you know, we could have, you 

know, permission to reimburse non-network providers, but I think 

there are a variety of things that could be done to increase the 

timeliness of—— 

Mrs. *Negrete McLeod.* Because it is one thing in philosophy to 

say we are going to provider services outside, but if there is no providers, then it is just an empty promise that we are going to do. 

Admiral *Carrato.* Correct. Correct. 

Mrs. *Negrete McLeod.* Thank you. 

Mr. BILIRAKIS. Yield back? 

Mrs. Negrete McLeod.* Yes. 

Mr. BILIRAKIS. Okay. Very good. 

Okay. I will recognize Mr. Jolly for five minutes. 

We are getting there, Ms. Brown. You are next. 


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Mr. JOLLY. Thank you. 

I actually just have a very general question. And if you don’t 

have enough information to answer, that is fine. 

Yesterday in my district office, I hosted about 300 people. We 

had what I call a veterans’ intake day for folks to come in, express 

their concerns and their compliments. And so I think everybody 

here has expressed, you know, we got great compliments, people 

who want to stay in the VA system, absolutely, and they never 

want to step outside of it. 

But then we also heard from those who do want to step outside 

of it. My primary takeaway from that event is we need to do even 

more in providing the veteran choice is the bottom line. The question, though, is how do we do that in a way that is fiscally responsible. 

And so my question for you generally, and, again, if you don’t 

have enough information, that is certainly fine, in your roles supporting non-VA care, can you give either an assessment, if you 

have technical information or if it is just a working opinion, on the 

cost effectiveness compared to traditional care, realizing that we 

have hard infrastructure costs within our VA system that aren’t reflected when you go to non-VA? 

We can look at all sorts of data. I am somebody who thinks typically data is manipulated to get whatever outcome or position we 

want to finally be able to support. 

But can you give an opinion or assessment on the cost effectiveness of non-VA care versus within the VA? 

Ms. DOODY. I can tell you from our experience with Project 

ARCH, and I wish I could give you specific numbers, sir, the company Altarum who was contracted to collect this information, and 

my understanding is they are going to report back to you folks in 

2015, are looking at the cost of care per veteran. 

From my understanding, it is less than if they would have gone 

to a VA facility for certain procedures. And so, again, it is anecdotal. It may be geographic. I can’t comment on the other regions 

or other states in our Nation, but also just limiting the amount of 

mileage, the traveling that the veteran would have to do traveling 

to a VA hospital to receive care is a savings to the system also. 

The veterans have also expressed, which I think is something 

that needs to be considered going forward, is there are times that 

they have not sought preventative care because they did not want 

to drive the extra miles to receive a colonoscopy or have a mammogram. 

And I think that is something we need to consider because those 

diagnoses that may be missed because a veteran has not received 

preventative care is very costly to our system. 

Admiral *Carrato.* I would say with PC3, it is a tough comparison comparing the care delivered in the VA brick and mortar to 

network care. But with PC3, the starting point for our reimbursement is, you know, Medicare levels and we have been successful in 

getting discounts from some of our providers. 

So I think if you compare PC3 care to other non-VA care, I think 

it will prove to be cost effective. But, again, it is pretty early to 

reach any conclusion. 

Mr. JOLLY. Sure. 


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Mr. MCINTYRE. And it is an integrated system in a loosely done 

way. So the fact of the matter is you need both sides of that puzzle 

to be able to make this work. And as was discovered by the Defense Department when they started down a similar journey 18 

years ago, it is a very effective way to be able to complete the other 

side of the puzzle. And as Tom said, people are signing up. 

The administrative fee that we get paid is very nominal as it 

should be and we get paid when the work comes our way. We don’t 

get paid before it comes our way. And that is the right way to do 

it from a taxpayer perspective. 

Mr. JOLLY. Very good. Thank you. 

Mr. Chairman, I yield back. 

Mr. BILIRAKIS. Thank you. 

Thank you so much for your patience, Ms. Brown. You are recognized for five minutes. 

Ms. BROWN. Thank you. 

And let’s be clear. I did like your Daddy better. 

But let me just say that the reason that I was a little late getting 

here is because I had guests that flew in from New York, Matthew 

Hamilton, president and CEO of Columbia Hospital. He is here and 

a couple of his colleagues. 

Why don’t you stand up? Stand up, you and it is a couple more 

people with you. Stand up. Yes, they are here. Thank you. 

And the point is there are people all over the country that want 

to do business with the VA. And they have an international certification. But the question is, how do you do business with VA? And 

I personally have a hundred percent support of the VA. But I do 

know that in certain cases that we need to partner outside of the 

VA to provide a certain amount of services. 

Someone spoke about Texas. Texas next to Florida, Texas sent 

back $95 billion of Medicaid reimbursement. Some of that money 

would have gone to veterans. Florida sent back $55 billion. And 

part of that system with our stakeholders is that we have transportation involved for the disabled or for the veteran, part of that 

Medicaid money that we have sent back to the Federal Government. So it is not just the VA. It is the VA partnering with different organizations and different groups. 

And someone mentioned TRICARE and medicine. Let me tell 

you. My mother is TRICARE, so I know what happened and, you 

know, that she can go anywhere she wants to in the community. 

Well, I went to the corner Walgreens to pick up her medicine and when I drove through, they said $200. So I know it is not no $200. 

She is TRICARE. I said check again. It came back $13.00 or 

$15.00. Some people, they would have just tried to pay it or 

wouldn’t have said anything. 

So we have got to make sure that we have oversight and make 

sure that our stakeholders, we are all on the same page because 

this is all taxpayers’ dollars. So it is very important that any system that we put in place that VA have the oversight and make 

sure that we are getting what we are paying for. 

So anyone want to respond to that? 

VA has worked with teaching hospitals, different groups. In fact, 

when the VA built the hospital in Orlando, hopefully one day it will 

open, but when we built that hospital in Orlando, it has been the 


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catalyst for the University of Florida, the University of Central 

Florida, many institutions, and it is a medical complex. And so, you 

know, it is a team effort. It is not just the VA. 

So why don’t you respond to that? 

Admiral *Carrato.* Well, first I would like to thank you for 

pointing out Mr. Hamilton and I certainly will reach out to him 

right after this hearing. 

Ms. BROWN. All right. I got his information here. 

Admiral *Carrato.* And, yeah, I think you are right. A lot of people are stepping up. I know in Orlando, the Florida Hospital and 

the Florida Hospital Medical Group have—we have begun those negotiations as a result of the issues they see. 

So you are correct. A lot of people want to help. And we want 

to, as I said, continue to grow our network. So, again, very much 

appreciate the introduction and I will follow-up after the hearing. 

Ms. BROWN. Thank you. Thank you. 

So you are operating now out of Florida? 

Admiral *Carrato.* Florida with the exception of the Panhandle. 

We have divided Florida. 

Ms. BROWN. I don’t know whether the Panhandle is really Florida, but if you say so. 

Admiral *Carrato.* Well, that is why Mr. McIntyre has the Panhandle. 

Mr. MCINTYRE. That must be because the chairman is not here. 

Ms. BROWN. It is the chairman. I take that back. The Panhandle 

is Florida. In fact, the people from Miami say if you are not in 

Miami, it is all Panhandle. 

But on the prescription, basically the 90 days, it works. The veterans like it. And if you are going to work with the local pharmacies, it is very important that you have the oversight because, 

like I said, I went through and she said $200 without skipping a 

beat. And I knew that was not the case. So it is very important 

that we have the oversight in the system. 

Ms. DOODY. Absolutely. Your comment about this being a team 

effort, and I can tell you from our experience with VA Togus in 

Maine, we are a team in providing healthcare services to our veterans in northern Maine. 

In fact, one of the models that we—as part of our model which 

we started many years ago, the administration from VA Togus 

based out of Augusta comes to Caribou and we host town hall 

meetings with our local veterans which has helped expand services 

for our veterans and it has been very successful. So we are working 

very collaboratively with the VA healthcare. 

Ms. BROWN. And to my surprise, veterans really like tele-medicine also. 

Ms. DOODY. Absolutely. 

Ms. BROWN. And so we are going to have a hearing in the next 

week on how we can expand that program. I was surprised because 

I would not have liked it. But when I visited with several of the 

veterans’ organizations and groups, they like it. 

Ms. DOODY. Absolutely, ma’am. And from our experience in rural 

parts of our country, tele-medicine is a wonderful option and it has 

been very successful. We have been doing it for in excess of ten 


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years and our local veterans are very appreciative of even that opportunity because they know it is another opportunity for access. 

Ms. BROWN. Thank you very much. 

Mr. Chairman, Chet Edwards, former Member of Congress, is in 

the audience and he has worked so many years with the veterans. 

Why don’t you stand up, too? 

Mr. BILIRAKIS. Absolutely. 

Ms. BROWN. Stand up. Let’s give him a hand. Thank you so 

much for being here. 

Mr. BILIRAKIS. Welcome, welcome, welcome. 

Ms. BROWN. Stand up so they can see you. All right. Thank you. 

Mr. BILIRAKIS. Welcome. 

Ms. BROWN. Thank you. 

All right. I yield back the balance of my time. 

Mr. BILIRAKIS. I gave you an extra minute just for the record. 

Okay. Any further questions? Any further questions? Yes, we 

have Ms. Titus. 

You are recognized for five minutes. 

Ms. TITUS. Thank you, Mr. Chairman. I appreciate it. 

As I have sat here and listened to all of you talk about some of 

the issues affecting non-VA care, it seems to me we can kind of 

sum them up with three. 

One, lack of providers which I talk about all the time. I represent 

Las Vegas. Now, there is a national lack of providers, especially in 

primary care, but we certainly have one in Las Vegas. So as we 

push veterans out of the VA and into the private sector, I don’t 

want that to be a push to the airport because they don’t have any 

doctor to see them at home. 

The Idaho approach 20 years ago of having a doctor step up and 

take on two veterans is great, but a bit idealistic in today’s world. 

The second issue is the reimbursement. Now, we have kind of 

talked about this, but the GAO report that we are going to be discussing in the next panel shows that it is slower, absolutely is 

slower than the private sector or other federal payers for 

healthcare. And the Federation of American Hospitals said that the 

unreimbursed claims often exceed 50 to 90 days, so we can’t ignore 

that as a problem. 

The third thing is in that same report, we see that the VA has 

insufficient data to judge the timeliness and the cost effectiveness 

of non-VA care. You confirm that you can’t talk about the cost effectiveness. There is just not enough data there yet. You think it 

is working pretty well, but we don’t have any hard figures. 

And we also know that CBO has been kind of unable to assess 

the cost going forward and nobody is talking about how to pay for 

it, yet we are moving pell-mell towards more veterans using this 

kind of non-VA care. 

Now, it is not that I am opposed to that, but I want us to do it 

right or else we will be having hearings five years from now talking 

about all the problems with non-VA care. 

Now, to hear you all talk about it, you are not having any problems, things are working great under your networks, but we know 

that is not true either. I mean, there are problems out there and 

we need to be serious about how to address them from the beginning. 


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Now, as I understand it, you all are just kind of like the middle 

man like Sallie Mae and Medicare Advantage where you have a 

contract to provide a service. That is fine. 

But as you push more people out into the private sector, do you 

see your kind of business growing? Is your network going to cover 

more areas or more new networks and competition going to come 

on to be part of this new system that we are going to be creating? 

Mr. MCINTYRE. Ma’am, if I might, thank you for your service, 

and we have the privilege of serving Las Vegas—— 

Ms. TITUS. I know you do. 

Mr. MCINTYRE. —among a number of other places in TRICARE. 

And in TRICARE, there were a lot of providers who stepped up and 

said I will take a few. And we are finding the same thing in the 

VA work. 

And what I will tell you is the way that that worked around 

Nellis, the way that worked with the other places in Nevada is that 

the care that couldn’t be rendered directly by the Defense Department was taken care of by the providers downtown. 

And we have been into this work since January 2nd following a 

90-day startup. And what I will tell you is—— 

Ms. TITUS. Which was pushed back, right? 

Mr. MCINTYRE. I am sorry? 

Ms. TITUS. Didn’t you have to push that deadline back? 

Mr. MCINTYRE. No. In Nevada, we started on January 2nd and 

after a 90-day startup and we have a lot of providers in Las Vegas 

that have stepped up that said they will be helpful in taking care 

of the veterans in that community. 

Now, we have some backlogs in that space, a lot of backlogs in 

gastroenterology. Guess what? There a lot of those providers in Las 

Vegas that have a lot of extra capacity because of the size of that 

community. And so them being able to digest that entire backlog 

in a 15 to 30-day period is very, very difficult to be able to do. 

And so we have been involved in a conversation with the gastroenterology community in Las Vegas by way of example for here is 

what we are looking at volume wise. We would like your help. They 

have said yes. And how can you open up your calendar to make 

sure that veterans can fit into the calendar as you are doing your 

scheduling in your office. And we are doing that a lot of places 

across the communities that we serve. 

On the primary care side, primary care is not done through these 

contracts today. In primary care in the Defense Department environment, there were providers all over the community in El Paso 

and beyond in Nevada that stepped up to say we will take a few. 

I can’t fill my entire practice with those that come through this 

program because the reimbursement rates may not be as high as 

they might be in some other programs, but I will take a few. And 

it worked and it will work here. 

Ms. TITUS. What about in Ely, Nevada where you don’t have a 

doctor who can step up and take a few? 

Mr. MCINTYRE. Well, if you are in Ely, Nevada and there are no 

providers in that community of a certain specialty type, which is 

a factual statement, as you know, then you can’t deliver the care 

in that community. 


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Then the question becomes where is the closest location to Ely 

to be able to deliver that care? And one of the things that we in 

the VA are trying to determine as we go through this process is 

where are the veterans and in what numbers that need to rely on 

the private sector as a pop-off valve or a relief valve to the direct 

care system and what is the demand so that we can make sure 

that those networks match to that. 

Ms. TITUS. Is that study ongoing right now? Are you doing a 

study? 

Mr. MCINTYRE. It is not a study. It is not a study. It is an engaged conversation that is going on every day across our geographic space and I am sure the same is true in the Health Net 

area to share information between both sides of the system to 

make sure that we identify together where those pockets are where 

we might need providers that might not have otherwise been 

known to all of us as we started up this program on January 2nd. 

Ms. TITUS. Is there hard data? Are you going to have hard data 

to show us or is this going to be anecdotal? 

Mr. MCINTYRE. I will be glad to come sit down with you and talk 

about the State of Nevada and the communities in your area that 

you are responsible for. And I would like to be measured against 

the same standard that Mr. Walz talked about which was at the 

end of the day when we got to a place that was at maturity, it 

won’t be five years from now, that the veterans that need care that 

rely on this program as well as the direct system are getting what 

they need. 

Ms. DOODY. In your comments, ma’am, the—I am sorry. Go 

ahead. No. Go ahead, please. 

Admiral *Carrato.* I was just going to say just in response to 

your points, claims payment, we are paying in a timely fashion, 30 

days or less. Reimbursement, we have been successful in achieving 

some discounts and we are continuing to grow our network. And 

as Dave said, part of it is looking where the demand is and matching supply to demand. 

In terms of what our organizations do as contractors, we do provide a lot of value. We pay claims timely, as I said. We coordinate 

care. We have quality oversight. We build networks in accordance 

with URAC accreditation requirements. So we do deliver value add 

to our veterans and to their healthcare needs. 

Ms. DOODY. And our arrangement, ma’am, is slightly different. 

It is a direct contract with the hospital without a middle person involved. And we work directly with the VA hospital within our state 

in coordinating the care for the veteran and what the needs might 

be. 

So it is direct access between the VA and our private hospital. 

So it is a very different arrangement and there is very open communication between the VA Togus, our hospital in our state, and 

our hospital. 

Ms. TITUS. Thank you, Mr. Chairman. 

Mr. BILIRAKIS. You are welcome. 

All right. Now I will recognize—you yield back obviously. Okay. 

I will recognize Mr.—do you have any questions, Mr. Coffman, for 

this panel? You are recognized, sir, for five minutes. 

Mr. COFFMAN. Thank you, Mr. Chairman. 


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Mr. McIntyre, I am not sure if this was covered, but in your written statement, you reference the experience TriWest brings to bear. 

As a former TRICARE provider, I just want to say you did a great 

job in the State of Colorado and I thank you for that. 

But what similarities and differences, if any, do you see between 

the implementation of TRICARE and the implementation to date 

of PC3? What lessons learned would you like to see VA take from 

TRICARE and applied to PC3 to improve the provision of care to 

veteran patients? 

Mr. MCINTYRE. I think that the VA on the VA PC3 side has done 

an admiral job under very, very tight time constraints and then the 

loading on of the challenges that we have all been talking about 

today. Those challenges got loaded in as this program started up. 

They were in the process of putting in place and maturing their 

own system, the NVCC care process, which has them standardizing 

how they put stuff to the marketplace. I think they would all say 

that that program wasn’t entirely at maturity at the time that this 

all started. 

A 90-day startup is a very, very short period. Nine months is 

short. Ninety days is really short. And I think we stood up. We 

were wobbling a bit, but we stood up what we needed to do. And 

I think looking backwards, if they had been given the opportunity 

to have more than 90 days, they probably would agree that that 

would make some sense. 

But I think by and large, things have gone reasonably well. They 

studied the TRICARE experience. They studied the implementation 

of other programs. And they did a pretty good job of designing a 

system that matches up to a very complicated enterprise. 

That unlike the military has differences site by site by site by 

site. And in the military, you see standardization by and large between the army facilities, between the air force facilities, and between the navy facilities. And you don’t find that kind of common 

consistency, yet the program office and central office have been trying to standardize their process to which this is matched. 

Mr. COFFMAN. Let me just start again. The PC3 program is a 

program whereby under the authorization of the VA, the veterans 

eligible for VA care can access non-VA providers. 

Would either of you also like to comment on the question? 

Admiral *Carrato.* On the similarities, sir, of the startup? 

Mr. COFFMAN. Sure. 

Admiral *Carrato.* I think Dave covered a lot. I agree that the 

VA did a very good job on defining the requirements for the PC3 

program. I think one of the things we are seeing in terms of similarities with a large program, a new program across just such a 

broad geographic area, there still are lessons to be learned. 

I think it is important to listen to our providers and some of the 

requirements that don’t quite fit with the civilian practice of medicine and see how we can address those. And obviously it is important to hear the voice of the veteran as well. 

So I think one of the big lessons learned is with the early startup, during that first year, pay attention to those lessons learned 

and adapt and be flexible in trying to improve the program and 

make it more efficient for all parties concerned. 

Mr. COFFMAN. Ms. Doody. 


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Ms. DOODY. Yes. From our experience, we started Project ARCH 

in the fall of 2011 and had to work very closely with the Veterans 

Administration since this was a new program and also had to learn 

some of the requirements as it related to the VA. And we also had 

a very tight time frame. In fact, at the beginning, it was a moving 

target on when Project ARCH was to go live. 

But we were able to pull it off and it is because of excellent relationship with the Veterans Administration. They provided us the 

support and the direction that we needed to make it happen for the 

veterans. 

And I agree with the comments of my colleagues. We have to listen to the veterans and what is working and what is not working 

and immediately respond to that. 

Mr. COFFMAN. Mr. McIntyre, very quickly. Prior to the recent 

Phoenix scandal in that hospital, how long did it take for a veteran 

to try and access an outside provider through the system? Do you 

have any idea of what that was like? 

Mr. MCINTYRE. I don’t. 

Mr. COFFMAN. Okay. 

Mr. MCINTYRE. And that is information that the VA should be 

able to provide to you. 

Mr. COFFMAN. Okay. Any other comments on that specific issue? 

Ms. DOODY. No, I am not aware. 

Mr. COFFMAN. Thank you, Mr. Chairman. I yield back. 

Mr. BILIRAKIS. Thank you. 

Mr. Wenstrup, you are recognized for five minutes. 

Mr. WENSTRUP. Thank you very much, Mr. Chairman. 

I want to talk about a couple things. I come from a group of 26 

doctors, orthopedics and sports medicine, and some of us had military background. And we felt an obligation to take TRICARE even 

though reimbursement was less and a desire to take TRICARE to 

take care of our military. So I appreciate what you were saying because I think that there is that appeal. 

You do have to monitor whether you are being overrun with it 

because it is not necessarily great for your bottom line, but you are 

willing to do that. And that is an appeal that I think we need to 

make to doctors in America that they will understand and not be 

chastised if they were to limit that amount but just encourage 

them to participate. 

And I think that would be a great benefit to us today. And I am 

glad to know that it has been successful. That was the notion within our group. 

But I also have a concept here that I would like to get your opinion on. You know, we have doctors that are VA doctors within the 

walls, but what about our specialists that are out in the community 

that we refer to? Can we credential them as VA doctors? 

And although they probably don’t want to learn the VistA system 

and get into all that, can they send a PDF of all their notes that 

can get into the VistA system and be accessible and at the same 

time when they write a prescription to the patients, because they 

are credentialed through the VA, can they just go get it filled at 

the VA? 

But some ideas along those lines where even though you are not 

within the walls, you are a VA physician outside the walls. 


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Mr. MCINTYRE. There certainly is value in the ability to supplement what can be done directly in the system by allowing providers 

to come in on a case-by-case basis and deliver services. And in 

some communities, that works. 

In Phoenix, Arizona, one of the things that is underway right 

now is discussion, as there should be, between the VA and some 

of the local facilities on can you expand our platform and give us 

the ability to actually make use of your facilities to deliver more 

care in the other direction because they have enough providers, but 

they don’t have enough OR space. That is always a good idea. 

And in Arizona, that has been going on for a long time between 

the air force and the community, the shrinkage of that hospital to 

a clinic. And so my guess is there is going to be a lot more of this 

conversation that goes forward. 

And I would like to thank you for your service to this community 

and really demonstrating the fact that it really does work if folks 

take a handful of their fellow citizens in these important programs 

and step up and do the work. And our job is to make it as seamless 

as we can make it to honor the service of those providers and make 

sure they get paid on time so that they will take another one or 

two in the next three or four months. 

And that model really does work, so thank you for validating 

that. 

Mr. WENSTRUP. Thank you. 

Mr. MCINTYRE. You bet. 

Mr. WENSTRUP. Unless someone else has a comment. 

Admiral *Carrato.* You know, since you threw out the concept, 

I will take the bait. And, you know, Dave has talked a lot about 

TRICARE. And I think the notion of assets moving from the private sector to the VA and the VA to the private sector has been 

demonstrated to be a very effective component of the TRICARE 

program. 

So if the VA has a service fully staffed with the exception of a 

technician or a certain provider, the contractor can provide that resource to the VA again to make sure that care is delivered. 

By the same token, there is something called external resource 

sharing. So if there is no OR space in the VA, you don’t want the 

surgeon’s skills to degrade, you can get them privileged at a network hospital. So that concept actually works very effectively in the 

DoD program. And it is a concept that is probably worth exploring 

within PC3. 

Mr. WENSTRUP. I appreciate the open-mindedness as we move 

forward. Thank you. 

Ms. DOODY. And from our experience in Project ARCH and actually your comments about can I use my own prescription pad and 

can I use some of my own forms, you sound like some of my physicians when we started Project ARCH. I have to be honest with you. 

And until we learned some of the forms or requirements of the 

VA, it was a transition time for our providers, but now it is a way 

of life. And I will be honest with you. We have actually learned 

from the VA some best practices that we have incorporated into our 

own hospital. 

Mr. WENSTRUP. Thank you very much. I appreciate your input. 

And I yield back. 


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Mr. BILIRAKIS. Thank you. Thank you very much. 

I will ask one last question for TriWest and Health Net. What 

are the performance measures you track besides and beyond profit? 

Mr. MCINTYRE. We have a responsibility to appoint people within 

a certain time frame. We track that. We track the volume of work 

that our staff is taking to complete. We track the providers that we 

are required to have from our perspective based on the demand 

that we see by facility and the location of veterans. 

And we track claims payment on the back end and we track the 

return of medical documentation back from the provider to the VA 

to make sure that the medical record when that person ends up 

back in the VA needing care is going to be complete. 

We track about 40 other metrics, but those are the ones that top 

of mind would probably be most important to making sure that we 

are staying focused on the very performance of what is going on 

here. 

What I will tell you is this year, our company is paying $29.00 

for the privilege of doing this work. And the reason for that is, and 

I am not complaining because we do that voluntarily, the reason 

is you pay to build your own infrastructure. And you only get paid 

for the work as it arrives and that requires advanced investment. 

And so we do that willingly and we believe at the end of the day 

that this program is going to be a good match to the direct delivery 

system just as TRICARE is to the Defense Department. 

Mr. BILIRAKIS. Thank you. 

Admiral *Carrato.* Yeah. We are an ISO 9000 certified organization, so we really focus on tracking performance metrics. Dave 

mentioned some of the more significant ones, but we have a program management review that we conduct monthly where we track 

all of the metrics that the VA uses to monitor our performance. 

And I can tell you that so far, things are going well. We also 

have a very detailed quality assurance surveillance program that 

we use. And I think that so far, you know, we have been performing well against those metrics. 

Mr. BILIRAKIS. Very good. 

Mr. Michaud, anything further? 

Mr. MICHAUD. No. 

Mr. BILIRAKIS. All right. Well, thank you very much again for 

your testimony today. 

And what we will do is dismiss the first panel and we will call 

the second panel. I want to welcome the second panel to the witness table. 

Joining us on the second panel is Randy Williamson, Mr. Randy 

Williamson from Health Care, director for the Government Accountability Office, and Mr. Philip Matkovsky, the assistant deputy 

under secretary for Health for Administrative Operations for the 

Department of Veterans Affairs. Welcome. 

Thank you both for being here today. If you are ready, Mr. 

Williamson, you are now recognized for five minutes. 

If you could check, your mic is on. 

Mr. WILLIAMSON. Thank you 


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STATEMENT OF RANDY WILLIAMSON 

Mr. WILLIAMSON. Thank you, Mr. Chairman, Ranking Member 

Michaud, and Members of the Committee. 

I am pleased to be here today to discuss our work on VA’s programs for delivery of care through non-VA providers. Non-VA providers treat veterans in community hospitals or doctors’ offices and 

VA pays for them using a fee-for-service arrangement. Last year 

VA spent about $4.8 billion dollars for non-VA provided medical 

care for more than one million veterans. 

Since VA intends to allow more veterans to see non-VA providers 

due to excessive wait times at some VA facilities, it is important 

to ensure that non-VA care is reliable, accessible, and efficient. Two 

recently GAO reports identified numerous weaknesses in VA’s 

management of its non-VA care program, and today, I want to address three broad areas that require VA’s attention in this regard. 

First, the need to eliminate VA claims processing errors mainly 

for emergency care provided at non-VA facilities. Second, the need 

for more focused oversight and reliable data to monitor the non-VA 

care program. And third, the need for better communication with 

veterans and non-VA providers about program eligibility and 

claims processing. 

Regarding claims processing errors, at four VA facilities we visited, we found patterns of noncompliance with VA processing requirements. Specifically, we reviewed a sample of 128 claims for 

emergency care non-VA providers had submitted to these four locations and found that VA had inappropriately denied 20 percent of 

the claims because VA clerks made mistakes in planning eligibility 

criteria and were sloppy in their procedures for processing claims. 

Moreover, VA did not always notify veterans, as required, that 

their claims had been denied; therefore, some veterans were likely 

billed for care that VA should have paid for and those not notified 

by VA were denied their appeal rights and were unaware they 

were liable for paying bills for non-VA providers. 

Looking forward, we found that VA, both at the national and 

local levels, does not have effective oversight mechanisms in place 

to detect claims processing errors or to monitor other important aspects of the non-VA care program. For example, the issue of wait 

times for appointments in VMACs, which has been a serious and 

longstanding problem for VA, could be an issue with non-VA providers as well. This is because once a veteran is authorized to use 

non-VA provider care, VA doesn’t track how long a veteran waits 

to see a non-VA provider. Because VA had virtually no data on 

this, little is now known about wait times for veterans seeking care 

outside VA. 

Finally, communication between VA and veterans and between 

VA and non-VA providers is lacking in some respects. We found on 

our visits to four locations that some veterans do not always understand their eligibility for coverage for emergency care from a nonVA provider and this has resulted in cases where veterans have 

avoided or delayed seeking emergency care for non-VA providers, 

sometimes to the veteran’s detriment. 

For example, a VA official we interviewed described one account 

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dred miles to a VA facility rather than seeking emergency care at 

a local non-VA medical facility. In another case, a veteran experiencing chest pains died during the weekend as he waited to seek 

care until a local veteran CBOC opened on Monday. 

Moreover, VA does not conduct any veteran surveys to identify 

specific gaps in veterans’ knowledge and determine how to better 

target its veteran education efforts. Non-VA hospital administrators and other providers we talked with also cited instances where 

VA claims processing staff had been unresponsive to the requests 

and queries about unpaid claims in efforts to move veterans back 

to VA facilities once their emergency conditions had stabilized as 

required. In some cases, non-VA providers had difficulty even obtaining a point of contact from the nearest VAMC to answer their 

questions. 

In summary, VA needs to improve the management of its nonVA care program to provide veterans with accessible, reliable and 

efficient care when they seek care from non-VA providers. VA 

needs to fully develop and implement a comprehensive strategy 

and action plan that addresses weaknesses the GAO and others 

have identified. This includes establishing clear responsibilities and 

expectation for what needs to be done and holding staff at all levels 

accountable for implementing the AVA care program, such that 

veterans are treated fairly and not put in harm’s way. This concludes my opening remarks. 

Mr. BILIRAKIS. Thank you. 


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Mr. Matkovsky, you are recognized for five minutes, sir. 

STATEMENT OF PHILIP MATKOVSKY 

Mr. MATKOVSKY. Thank you, sir. 

Good morning, Mr. Chairman, Ranking Member Michaud, and 

Members of the Committee. 

Thank you for the opportunity to discuss VA’s non-VA care programs. I would also like to take a moment to thank and acknowledge our partners, TriWest, Health Net and the Cary Medical Center for their collaboration in providing health care to veterans. 

We at the VA provide care to veterans directly in our facilities 

or through contracts which includes individual authorizations or reimbursements for emergency care. Taken together, these are the 

non-VA care programs and they are designed to ensure veterans receive safe, effective and timely health care. It is our policy to provide veterans necessary care within our system when feasible. 

When we cannot provide necessary hospital care and medical services in our facilities, we are authorized to provide that care through 

qualified community partners. 

On May 23rd, we deployed the Accelerating Care Initiative, a coordinated systemwide initiative to accelerate care to veterans. This 

initiative strengthens access to care in the VA system, but also ensures flexibility in use of private sector care when and where it is 

needed. Where we cannot quickly increase our capacity, which we 

owe the American taxpayers, we are increasing our use of care 

through the community. I would like to say that we have identified 

in excess of $300 million dollars additional funds for non-VA care 

at this point. 

Today, I am focusing on two major initiatives to improve oversight, management and delivery of non-VA care, Patient-Centered 

Care in the Community, PC3, and the Non-VA Care Coordination 

Program, NVCC. PC3, as we heard earlier, is a nationwide program of health care contracts to provide veterans access to specialty care. PC3 is really formed by these contracts with Health 

Net and TriWest that we learned about earlier. 

These two firms have developed networks of providers who deliver the covered care including specialty care, mental health, limited emergency, and some newborn. This program first received its 

authorization in January and in some cases is fully implements. 

The Non-VA Care Coordination Program, again, NVCC, is really 

an internal program to improve and standardize our processes for 

referrals. NVCC really is about referral management, effective controls, consistency, documentation, tracking, and coordination of patients in community health facilities. Through this activity, our 

staff are to use standardized processes, templates for the administrative functions associated with non-VA care. This system is now 

nationwide deployed. 

Authority to pay for non-VA emergency treatment, I need to explain, is limited by statute. Generally speaking, we can authorize 

non-VA emergency treatment for serious medical emergencies experienced by veterans who are receiving medical services in VA facilities when we cannot clinically manage that. When a veteran experiences a medical emergency apart from these situations, we advise 


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on all of our phone calls—phone systems that the veteran should 

seek care at the nearest emergency department. 

I need to say that, however, by law, such care is not always considered to be authorized or pre-authorized. Whether VA has legal 

authority to pay for emergency treatment depends on certain eligibility factors for reimbursement or payment of those expenses. Simply put, veterans must meet statutory and regulatory criteria applicable to benefits under the U.S. Code Title 38. Unfortunately, not 

all veterans meet those criteria. 

I acknowledge on Mr. Williamson’s comments that we should 

have improved our communication to our veterans making sure 

that we provide information about what we are allowed to and not 

allowed to cover. We have done some of that in our tailored health 

benefits plan that each veteran receives, but there is more to do. 

We can and will improve that work. 

We are completing Project ARCH or Access Received Closer to 

Home. That is a three-year pilot program to evaluate how to improve access to quality health care. Authority for Project ARCH 

does expire August 29th. 

The PC3 contracts that we learned about earlier provide coverage for veterans in rural, highly rural areas for inpatient and 

outpatient medical and surgical specialty care, as well as urban 

areas; therefore, veterans requiring those services will not be impacted by the expiration of ARCH contracts. 

Individual transition plans have been developed for all veterans 

and we are now extending our use of contract care to include primary care. We developed a solicitation which is now receiving proposals for contract primary care services in Arizona, New Mexico 

and parts of Texas. We will extend that effort next for primary care 

nationwide 

In conclusion, our mission is to provide timely and quality health 

care to those who have served our country in an environment that 

understands and honors their military service. We recognize and 

acknowledge we cannot always do that timely in our facilities. We 

are enhancing our use of non-VA care to ensure that we provide 

veterans with quality and timely care when, where and how they 

want it. 

Mr. Chairman, Mr. Ranking Member, I thank this Committee for 

its dedication to and care for our nation’s veterans. I appreciate the 

opportunity to appear before you and I am prepared to answer your 

questions. 

Mr. BILIRAKIS. Thank you, gentlemen, for your testimony. Appreciate it. 

I will recognize myself for five minutes for questions. 

Mr. Matkovsky, information VA released last week revealed that 

over 57,000 veterans have been waiting 90 days or more for their 

first VA medical appointment and 64,000 veterans, who have enrolled in the VA Health Care System over the last decade, never 

received the appointment they requested. That is 121,000 veterans 

who have not been provided the care they have earned and deserved. 

Why did the Department allow these veterans to wait months 

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ring them to a non-VA care provider to receive the care that they 

needed? 

Mr. MATKOVSKY. Congressman, I will tell you for the 57,000 on 

the electronic work list, we are working that process now with accelerating care. For the newly enrolled appointment request, which 

you reference, which was roughly 64,000, you are correct, that is 

just not excusable and we should have had our eye on that and we 

did not. 

I will tell you one thing that our staff did as they assessed all 

veterans who had not received an appointment yet, out of an abundance of caution, here’s what we did: If a veteran had an enrollment processed at a VA medical center and we could not definitively identify an appointment in that facility—I don’t care if they 

were seen anywhere else in our system, but if they applied in the 

Tampa VA for instance, and they did not have an appointment 

there, we went all the way back to the beginning of the enrollment 

and added them to our contact list. So as of the 64,000 where we 

were before, as of this morning, and I think we will be producing 

an additional update, we had below 30,000 to contact. We are 

working that list aggressively. We should not have let it slip, but 

we did, out of an abundance of caution, pull everybody we could 

imagine. 

Mr. BILIRAKIS. Yeah, I just can’t—I just don’t understand. It is 

reprehensible, inexcusable that these veterans would have to wait 

that long, and some months, and years. 

Anyway, what interaction exists between the non-VA care and 

the VA’s electronic waiting list? 

Mr. MATKOVSKY. Right now, what we have done with accelerating care, we have produced directive out to the field. And what 

we asked the field to do, and we published their productivity numbers, their capacity numbers, and their efficiency numbers. The 

first order of business what to determine whether or not they could 

increase their capacity. If they could not, they could not run an 

extra clinic, an extra half-day clinic, evening hours or weekend 

hours, they were directed to identify capacity in the community. 

One of the things we did with that, our PC3 program office 

shared all of our data with the PC3 contractors so that they would 

have that available. Their instruction was if they could not find it 

inside the facility, to then refer that to care in the community 

through non-VA care. We made over $300 million dollars available 

in supplemental. As of yesterday, close of business, $127 million 

dollars of that supplemental had already been obligated for non-VA 

care episodes. 

Mr. BILIRAKIS. Next question, sir, for you: I understand from 

your testimony that claims processing, activities for non-VA care 

are centralized at the VISN level or decentralized at the facility 

level. How much variance did you find from location to location on 

how non-VA claims are processed throughout VA and what effect 

do you think such variance has to the timeliness and accuracy of 

non-VA care claims processing? 

Mr. MATKOVSKY. That is for me, sir? 

Mr. BILIRAKIS. Yes, for you. 

Mr. MATKOVSKY. I will be candid. I think that the variability 

does exist site to site. We began in October and one item that we 


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focused on in addition to claims payment accuracy, which we focused on throughout all of fiscal year 2013—beginning in fiscal 

year 2014, our drive was really to make sure, quite simply, that we 

paid our bills on time, irrespective of the distributive nature. So we 

had been focusing on each one of our claims payment centers, 

whether it is a VISN or a facility level, but the distributed system 

does have variability. 

Mr. BILIRAKIS. Mr. Williamson, could you comment on that, 

please? 

Mr. WILLIAMSON. We looked at a number of systems, some of 

which were centralized at the VISN level and others that were at 

individual VAMCs, and we didn’t really see a variation in the quality of the claims processing. There were a pattern of errors no matter what system used. 

Mr. BILIRAKIS. Thank you. 

I will recognize the ranking member, Mr. Michaud for five minutes. 

Mr. MICHAUD. Thank you very much, Mr. Chairman. 

Mr. Matkovsky, thanks again for coming here, appreciate it. 

Under the PC3 program, what are the reimbursement rates of 

both TriWest and Health Net? 

Mr. MATKOVSKY. Well, I can tell you—I think the technical 

term—I think I am going to get this wrong—but I think the technical term is privity of contract. As the Government does not have 

privy of contract to the PC3 network, but the PC3, we reimburse 

at CMS rates, sir. We also have an administrative fee that we pay 

out. 

Mr. MICHAUD. So they get paid Medicare rates, plus administrative? 

Mr. MATKOVSKY. That is correct, sir. 

Mr. MICHAUD. What are you reimbursing the ARCH program? 

Mr. MATKOVSKY. ARCH, I believe there are different rates, but 

I believe for Cary is at CMS rates. 

Mr. MICHAUD. At CMS rates. 

Mr. MATKOVSKY. And there are different rates for different sites. 

Mr. MICHAUD. But you are not paying administrative rates above 

and beyond? 

Mr. MATKOVSKY. I do not believe so, sir. 

Mr. MICHAUD. Okay. We heard earlier about payments to ARCH 

is slow in getting there, why is that? Is there anything to speed up 

the payments? 

Mr. MATKOVSKY. I was looking through our VISN 1 where they 

are currently located and in network one our payments rates had 

dipped a little bit below 80 percent, but now we are—80 percent 

of our unpaid claims are 30 days or younger. One thing I would 

have to do is go in and take a look at them and have a detailed 

poll run for Cary. It shouldn’t be a case where we have got payments that are outstanding very long. 

Mr. MICHAUD. Okay. Do you need additional authority to continue the ARCH program? 

Mr. MATKOVSKY. Well, actually, very interesting question. Thank 

you for that. 


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Technically speaking, we have the authorities to cover that. We 

would have both the sharing authority under 8153 and frankly we 

have the fee authorities under 1703. 

PC3 is very comparable. I have to say, you know, PC3 is kind 

of an outgrowth of what we have learned in ARCH and some other 

previous efforts, so it is an extension of that and we are using our 

existing authorities of 8153 and some of 1703 to do PC3 nationwide. So, no, I don’t think we require that. 

Mr. MICHAUD. Oh, so you don’t need additional authority to continue the ARCH with looking at all of your other authorities? 

Mr. MATKOVSKY. I will say one thing about ARCH, and I am not 

a contracting officer, but ARCH does expire as a contract. It was 

a firm-termed contract with a base one year and then two option 

years which expires, I believe, September 30th. I think there has 

been some question about when does it expire. The legislative authority identified as August 29th. The contract is September 30th. 

And typically, unless the contracting officer can determine a compelling reason to extend that, and I am not a contracting officer, 

we let the contracts expire. 

Mr. MICHAUD. Okay. And what about reimbursements—my big 

concern is getting back to the reimbursement rates, particularly 

when you look at, it is my understanding that they are less for the 

PC3 program, and my big concern is if you are reimbursing 

TriWest and Health Net at the CMS rate but they are contracting 

with a provider and their contracts will then give you a little bit 

less than CMS rate, first of all, can they do that? 

Mr. MATKOVSKY. Well, again, I am certainly limited on what I 

can say called privity. There is only so much and only so much we 

should. Purely anecdotally or conjecturally on my part, some of my 

friends and peers were in the private sector health care community, as we discussed the evolution of ACOs, I think what we are 

seeing in the ACO marketplace is reimbursement rates below CMS 

rates, as well. So I realize there is some concern that has been 

voiced here, both officially and then through other channels, my 

sense is that the market is heading that way anyway. 

Mr. MICHAUD. Well, here’s my big concern is the fact that, particularly when you look at states like Maine, we have the oldest 

population in the country, number one in Medicare, number two in 

Medicaid, second from the bottom on reimbursement rate. And 

when you have providers that have 65, 70 percent of their patient 

workload on either Medicare or Medicaid rate, then that is a huge 

problem as far as them being able to provide the services and we 

are already hearing providers saying that they are not going to 

take anywhere Medicare or Medicaid patients because they can’t 

sustain that type of loss. 

And that is the huge concern I have, particularly if you do not 

continue the ARCH program in its form or whatever the reimbursement rate that they are getting in rural areas because it is—we are 

not in the Boston market area and it is very difficult, particularly 

for specialty care, and that is the huge concern that I have with 

that program going away if you don’t reauthorize it, what is the, 

you know, existing rates. 

Mr. MATKOVSKY. Well, let me tell you this, you know, as I understand it, that network under the PC3 program is getting built out 


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even in rural Maine. I just need to address that first of all, not to 

get into any specifics. But we have individual authorization authority as well. 

And in another GAO study which reviewed our overarching program, one of the things that they advised us to do is to look at the 

beneficiary travel reimbursement rates and use that as a determining factor as well. I think it is good input. We are working on 

our procedure guidelines to do that. We spend about just shy of 

$800 million dollars in travel reimbursement a year. 

Now, granted, veterans are owed that. It helps with the travel 

burden, but if a veteran would receive that care closer to home, we 

would prefer that. It would obviate the need for travel which can 

be dangerous which is inconvenient, right? Then we should factor 

that in and use individual authorizations or other means to make 

sure that that care can be closer to Caribou. 

Mr. MICHAUD. Yeah, I appreciate that because I can’t see it in 

my notes, but it is my understanding that they were able to save 

travel rates, about $600,000. 

Mr. MATKOVSKY. Yes, they did. 

Mr. MICHAUD. I thought that is what they said the savings would 

be. 

So thank you very much, Mr. Chairman. 

Mr. BILIRAKIS. Thank you. 

I will recognize Ms. Brown for five minutes. 

Ms. BROWN. Thank you, Mr. Chairman. 

Florida has close to 1.6 million veterans, so whatever system that 

you are beginning to develop, I would think that Florida would be 

foremost on the planning when so many of the veterans, even 

though we have close to two million, so many of the veterans from 

the northeast come to Florida particularly during the wintertime, 

and, of course, Secretary Brown was the person that helped us get 

reimbursements because at one point they were using the system 

and we weren’t getting the reimbursement for the system. 

We have had problems with the system and as we go into this 

afternoon there is a bill on the floor, House, Senate, then we are 

going to go to conference. I want to make sure that we develop a 

program that will keep the quality of care, which is some of the 

best in the world, but also this timeliness serving the veterans. 

And what is some of your recommendations regardless of—you 

know, I think the Senate bill might be a little bit better than the 

House, I can’t believe that, but I do—but what are some of your 

recommendations to make sure that—you know, I have been accused of being a VA person, I am a veterans person. 

Mr. MATKOVSKY. First and foremost, we have heard some of the 

comments and Mr. Williamson has alluded it as well, we have to 

make sure that we do coordination of care, that we monitor that. 

I have heard some of the comments earlier, I think, from some of 

the committee members about making sure we have eyes on the referral timeliness, that we can monitor that. So one of the things 

that I would say we need to make sure that when we do Non-VA 

Care Coordination we staff it with adequate clinical resources, as 

well as administrative resources so we can monitor that care, ensure that it is quality care. We have a responsibility to that. 


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In the VA when we refer to the community, we are not absolved 

of the responsibility for that care. It is still VA care, and even 

though we may call it non-VA care, it is still our care that we are 

delivering to veterans. So I think that is one thing to be mindful 

of is what oversight responsibility must we have to make sure that 

that is done right. 

Ms. BROWN. Absolutely. In fact, in the hearing the other night, 

someone came and talked about a death in the system and that 

person was outsourced to someone and the VA—that person didn’t 

have the follow up, so it is very clear that when VA works with 

other stakeholders, that you have to have that relationship and 

that follow up. 

Mr. MATKOVSKY. The only other thing that I would mention, as 

Mr. Williamson alludes for processing of claims, a lot of our claims 

processing today remains kind of manual. It is getting a little bit 

more automated with older systems. 

Ms. BROWN. And I know that, and I know that the Chair recognized that because we used to do most of that process out of his 

area in Florida. 

St. Petersburg, isn’t that your area? 

Mr. BILIRAKIS. Right. 

Ms. BROWN. Yes, sir. 

But go ahead. 

Mr. MATKOVSKY. The other thing that I would mention is you 

consider—and this is just a personal opinion realizing that I am 

just trying to give some personal input, opining, if I may—that 

some of the legislation that is being thought about may really alter 

the structure of the consumption of health benefits in the general 

marketplace and we have to understand what that might mean to 

the administrative and other systems within the VA. 

What do I mean by that? If we look at the structure that seems 

to be used for the geographic distance and other, it sort of models 

TRICARE. It may also model Medicare. But based on reimbursement rates, based on out-of-pocket co-pays more folks may use this 

other payment system instead, right? 

Ms. BROWN. Uh-huh. 

Mr. MATKOVSKY. We just have to make sure that we also consider the administrative ramp-up and other factors associated that, 

as well, that this may be really a game changer in a way that we 

don’t yet understand. 

Ms. BROWN. And I think it is very important that we keep a handle on that. 

Mr. Williamson, would you like to respond to that? 

Mr. WILLIAMSON. I couldn’t agree more with Mr. Matkovsky, especially, regarding his comment about oversight. I think that oversight and having sound data to base that oversight on is extremely 

important, so I would agree with his comments, and I think he recognizes that. 

Ms. BROWN. All right. Well, we will work together, and I yield 

back the balance of my time. 

Mr. BILIRAKIS. Thank you so much. Appreciate it. 


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PREPARED STATEMENT OF PHILIP MATKOVSKY 

Good morning, Chairman Miller, Ranking Member Michaud, and 

Members of the Committee. Thank you for the opportunity to discuss the Department of Veterans Affairs’ (VA) non-VA care programs. 

As former Secretary Shinseki and Acting Secretary Gibson have 

stated, we now know that within some of our Veterans Health Administration (VHA) facilities, VA has learned of some systemic 

issues that are unacceptable and demonstrate a lack of integrity. 

That breach of trust—which involved the tracking of patient wait 

times for appointments—is irresponsible, indefensible, and unacceptable to the Department. Let me apologize to our Veterans, 

their families and loved ones, Members of Congress, Veterans Service Organizations, and to the American people. You all deserve better from us. 

VA provides care to Veterans directly in a VHA facility or indirectly through contracts, including contracts formed when providers accept individual authorizations, or through reimbursements, such as for emergency care. This mix of in-house and external care provides Veterans the full continuum of health care services covered under our medical benefits package. VA’s non-VA Care 

programs are designed to ensure high-quality care is provided to 

Veterans under its non-VA care authorities. The programs are also 

designed to ensure Veterans receive effective and efficient non-VA 

care seamlessly. 

It is VHA policy to provide eligible Veterans necessary care within the VA system when feasible and authorized by law. When VA 

cannot provide the necessary hospital care and medical services at 

a VA medical facility, it is authorized to provide that care through 

non-VA providers through non-VA care programs in accordance 

with 38 United States Code (U.S.C.) 1703, 1725, 1728, 8111, and 

8153. 

On May 23, 2014, VHA established the Accelerating Care Initiative, a coordinated, system-wide initiative to accelerate care to Veterans. This initiative increases timely access to care for Veteran 

patients; decreases the number of Veteran patients on the Electronic Work List (EWL); decreases the number of Veterans waiting 

greater than 30 days for their care; and, standardizes process and 

tools for ongoing monitoring of access management at VA facilities. 

This initiative includes activities such as ensuring Primary Care 

clinic panels are correctly sized and achieving the desired level of 

productivity; extending or flexing clinic hours on nights and weekends; and, assessing the availability of community providers to 

meet care needs. The initiative strengthens access to care in the 

VA system while ensuring flexibility to use private sector care 

when needed. Where VA cannot quickly increase capacity, VA is increasing the use of care in the community through non-VA care. 

VA is focusing on two major initiatives to improve the oversight, 

management, and delivery of non-VA care: Patient-Centered Community Care (PC3) and the Non-VA Care Coordination (NVCC) 

program. PC3 is a VHA nationwide program of health care contracts to provide eligible Veterans access to specialty care. Under 

PC3, VHA contracts with Health Net and TriWest which have deVerDate Aug 31 2005 11:41 Oct 28, 2014 Jkt 000000 PO 00000 Frm 00093 Fmt 6633 Sfmt 6633 Y:\89373.TXT PAT

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veloped networks of providers who deliver the covered care, including specialty care, mental health care, limited emergency care and 

limited newborn care. The goal is to ensure Veterans receive care 

from qualified community providers that is timely, accessible, and 

courteous, that honors Veterans’ preferences, enhances medical 

documentation sharing, and that is coordinated with VA providers 

when VA services are not available or feasible. 

NVCC is VA’s internal program to improve and standardize our 

processes for referrals to non-VA care. The NVCC model centers on 

effective referral management and consistency in documenting, 

tracking, and coordinating patients in community health facilities. 

Through NVCC, non-VA care program staff use standardized processes and templates for the administrative functions associated 

with non-VA care, including when a Veteran is admitted to a nonVA health care facility for emergency treatment. 

VA utilizes additional authorities in furnishing hospital care and 

medical services to Veterans. When a Veteran experiences an emergency situation, VA recommends that a Veteran seek care at the 

nearest emergency department. VA is authorized to pay or reimburse for non-VA emergency treatment furnished Veterans in accordance with 38 U.S.C. 1728 and 1725. In general, 38 U.S.C. 1725 

requires VA to provide reimbursement for non-VA emergency treatment of certain Veterans with non-service-connected conditions. 

Veterans must meet all conditions of this statute to be eligible for 

payment/reimbursement to include that the Veteran be an ‘‘active 

Department health-care participant’’ who is personally liable for 

the emergency treatment furnished. A Veteran is an active Department health-care participant if he or she is enrolled in the VA 

health care system and has received health care services under the 

authority of 38 U.S.C. Chapter 17 within the previous 24 months. 

In general, 38 U.S.C. 1728 requires VA to reimburse for emergency 

treatment related to a Veteran’s service connected conditions. 

Also, VA is completing Project ARCH (Access Received Closer to 

Home), which is a 3-year pilot program to evaluate how to improve 

access to quality health care for rural and highly rural Veterans by 

providing these services closer to where they live through contractual agreements with non-VA medical providers. Project ARCH authority, section 403 of P.L. 110–387; 38 USC 1703 note, expires on 

August 29, 2014. The PC3 contracts provide coverage for Veterans 

in rural and highly rural areas for inpatient and outpatient medical and surgical specialty care, therefore Veterans requiring those 

services should not be impacted by the expiration of the ARCH contracts. In preparation for the expiration of the Project ARCH authority, individual transition plans for each Veteran participating 

in Project ARCH are being created. In addition, VHA is leading an 

integrated project team to review alternatives for providing primary care for rural Veterans. 

Conclusion 

VA delivers high quality health care to Veterans in an environment that understands and honors their military service. A continuum of health care services is covered under our medical benefits package. VA’s policy is to provide timely care to Veterans within its system where feasible, but we recognize we cannot provide 

the necessary care to every Veteran in our facilities. We are enVerDate Aug 31 2005 11:41 Oct 28, 2014 Jkt 000000 PO 00000 Frm 00094 Fmt 6633 Sfmt 6633 Y:\89373.TXT PAT

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hancing our use of non-VA care to ensure we provide Veterans with 

quality healthcare when, where, and how they want it. Mr. Chairman and Mr. Ranking Member, I appreciate the opportunity to appear before you today. I am prepared to answer your questions. 

Ms. Kuster, you are recognized for five minutes, please. Thank 

you. 

Ms. KUSTER. Thank you very much, Mr. Chairman. 

Thank you, both of you, for being here with us today. I have a 

question for Mr. Matkovsky. In light of these audit findings and 

the reports that we have been receiving from OIG and GAO, why 

did the veterans medical centers not use the authority that they 

had to use non-VA care to send veterans out to the private sector 

and was it that the VA did not want to spend the money to get 

the veterans off the electronic wait list? I don’t think I yet understand what was the hold up. If this was an option, why wasn’t it 

used more often and why were people languishing on wait lists? 

Mr. MATKOVSKY. Sure. This is sort of a very complicated question, so if you don’t mind, I will try to break it down and answer 

it. I think a couple of things, first of all, there is a historical context, right? So some years back we were receiving a good deal of 

criticism for our use of non-VA care, so historically we have been 

criticized and so, maybe inappropriately, we overcorrected to use 

that less. I think that is part of it; it is not all of it. 

I think the other thing, as we are going to get better wait-time 

data, as we improve the integrity of that reporting, we are going 

to have a better sense of where veterans are waiting for care. We 

started reporting another set of numbers last week which was this 

prospective wait measure, right, which showed us veterans who 

were scheduled and who were scheduled out longer. Historically, 

we have not looked at that either. 

So if we add those two factors, improve the integrity of our data 

so that we can have a sense of where veterans are waiting, and 

then look out, if you will, into the upcoming months where veterans are waiting, we can use that to help us determine where 

should we offer care to veterans. That is what we did with accelerating care. We took those numbers and said this is your situation. These are your veterans that are waiting too long. You have 

VA resources. If you can get more out of them, great, do that. If 

you cannot, you have the authority in non-VA care, go, tell us how 

much you need, right? 

We have not done that before. We have not really married up 

waiting time information with our use of non-VA. Going forward, 

we are going to. 

Ms. KUSTER. Well, I think that was my biggest concern and 

maybe Mr. Williamson, you can comment on your report, but it appeared to me that you didn’t have effective data and you weren’t 

able to use it in a timely or even rational way to determine whether or not it would be more cost effective for taxpayers and frankly, 

more beneficial to veterans, if you either added history resources, 

medical providers to the VA system or went to the private sector. 

And even when veterans were sent to the private sector, there 

has not been this cost-benefit analysis. How are we, as Members 

of Congress, to determine how best to employ—deploy the resources? We don’t even know at this point. Should we be hiring 


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more doctors and nurses and healthcare providers or should we be 

sending people out to the private sector? We don’t have a logical 

way to make those decisions. 

We are talking about significant dollars here and we are talking 

about a fundamental promise that we have made to our veterans. 

We want to get this right. 

Mr. WILLIAMSON. I think the first priority is to get the wait time 

scheduling problem resolved and once that is done, there will be a 

more accurate idea of just how many people need to seek care from 

non-VA care providers. And I think to do that, a number of fixes 

have to be made. Then, there needs to be oversight, especially the 

first line of supervisory level to make sure that new procedures are 

being carried out the way they are supposed to be. 

Ms. KUSTER. So you mentioned about getting to the crux of the 

scheduling because obviously it is a pretty inefficient system that 

we have learned about, 50 percent no-shows. Are you familiar with 

the DoD process that they have? A patient-centered infrastructure 

where the patients, themselves, can go online. It is a web-based 

system. They can schedule an appointment. They can refill a medication. 

Are you familiar with that, and would you recommend that type 

of process to the VA and do you think it would impact this scheduling fiasco that we are worried about right now? 

Mr. WILLIAMSON. I am not. I heard you mention that earlier and 

I thought it was very intriguing. We have not done any work on 

the DoD side in this regard. 

Ms. KUSTER. Yeah. I would just say to Mr. Matkovsky I would 

highly recommend this approach. I just learned about it myself 

today, but it seems as though it would be particularly with the recent vets who are used to using this system in the DoD, that you 

could just cut right to the crux of the matter in terms of not only 

scheduling the appointments in a timely way, in an effective way 

that they would be likely to show up, but that they could change 

appointments, that you could get them the notices of the appointment coming. 

So my time is expired, I apologize Mr. Chairman, but thank you 

very much. 

Mr. BILIRAKIS. Thank you, Ms. Kuster. 

Mr. O’Rourke, you are recognized for five minutes. 

Mr. *O’Rourke.* Thank you, Mr. Chair. 

First, Mr. Williamson, thank you for your report and presenting 

your findings, one of which was that the VA does not currently 

track wait times for care that is delivered in the community, if I 

understood your comments correctly? 

Mr. WILLIAMSON. Correct. 

Mr. *O’Rourke.* And so would you say that it is fair to conclude 

that we still don’t know what wait times are for veterans, because 

while there is a distinction between care delivered by the VA and 

care delivered in the outside community, there is not enough difference in that distinction to ultimately matter. You just want to 

know how long it took to see the person that you needed to see. 

Mr. WILLIAMSON. Right. Up to this point, it is true that wait 

times have not been tracked, but I think there are going to be some 

changes under PC3 and under a system called NVCC, which Mr. 


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Matkovsky references in his statement. The difficulty there is that 

NVCC, which is a care coordination set of protocols to help the veteran go from the VA system to schedule an appointment with a 

non-VA provider, is that the wait time portion of NVCC is not yet 

automated. It is done manually, and the data feeding into it is also 

self-reported by the provider. 

So VA will be able to track a veteran to the point where the veteran gets scheduled for an appointment, but if that appointment is 

rescheduled, VA’s NVCC will relie on the provider to tell them. I 

don’t think VA has good visibility over when an appointment actually occurs. 

Mr. *O’Rourke.* I think that is an incredibly important finding 

and recommendation that you made because, you know, until we 

have the facts and the best information, we are not going to be able 

to make the best authorizing and appropriating and oversight decisions as a committee and the VA won’t be able to do its best in its 

job. 

And to use El Paso as an example, as I have done in previous 

hearings, as recently as a month ago we were told there were zero 

days wait time for new patient mental health care appointments 

who were told last week on Monday from the VHA’s audit that it 

was actually 60 days. But if there were people who were referred 

out into the community and that is not being tracked, we may still 

not have a correct—I think I want to trust that the VHA is giving 

us the best information post-audit that they can, but it is still not 

all the information. So I think that is still something for us to continue to follow up on. 

And for Mr. Matkovsky, I want to ask some—follow up on some 

questions relating to how the VHA makes decisions about referring 

out to community care. We saw that there was a very good intention from VA to see people within 14 days, so see veterans within 

14 days, and that that very good intention was then turned in to 

a goal and then a performance measure and then something that 

was part of the criteria for which VHA administrators were 

bonused. 

Is something like that happening when it comes to referring veterans out to community care? Is the local VHA director bonused in 

part by how much money he is able to save by not referring people 

out into community care? 

Mr. MATKOVSKY. I don’t believe so, sir. You know, I haven’t reviewed every single performance contract. I have to be clear. One 

of the things that we need to focus on, I think, is the undermined 

is a veteran—experienced, right? If we have better data about wait 

times, we can make better decisions about where care should be delivered and how. 

The other thing that we owe, quite frankly, is to make sure that 

we have productive, high-performing clinical resources in our facilities. Scheduling is the mechanism to access those and a way to 

manage efficiently, the delivery of that care. So as our scheduling 

data are better, as we look forward in our scheduling calendar, we 

can find individual veterans who we think are waiting too long and 

then use that as a basis to refer, at their choice. 

Mr. *O’Rourke.* Yeah. 


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Mr. MATKOVSKY. Now, the other thing we need to do, just very 

quickly, we also need to make sure that we are monitoring that 

care and as quickly as we can, get some automation solutions to 

know that you are seen timely in the community. 

Mr. *O’Rourke.* Will you commit to getting back to me and the 

committee in just answering that question conclusively about 

whether or not that is part of the criteria used to bonus? 

Mr. MATKOVSKY. Yes. 

Mr. *O’Rourke.* I think it is important, given what we now know 

about how people are bonused and how that leads to some unintended consequences. 

Mr. MATKOVSKY. I will do that definitively. 

Mr. *O’Rourke.* You mentioned $300 million dollars in additional non-VA care resources, where did that money come from? 

Mr. MATKOVSKY. It came from a variety of sources, but the vast 

majority of it, from what we call carryover to offset some of the fiscal year 2015 requirement. 

Mr. *O’Rourke.* And at a press release last week, acting VA secretary announces $7.4 million dollars to Fayetteville, North Carolina for additional care. 

Mr. MATKOVSKY. Yes, sir. 

Mr. *O’Rourke.* Does that come out of the $300 million dollars? 

Mr. MATKOVSKY. Yes, sir. 

Mr. *O’Rourke.* And the $1.9 million dollars that came out or 

that is being directed to El Paso, I am told by Dr. Jesse that comes 

out of the $300 million dollars? 

Mr. MATKOVSKY. That is correct, sir. 

Mr. *O’Rourke.* How do you all decide that Fayetteville gets 7.4, 

El Paso, 1.9, some other community, another amount? When I look 

at the metrics from the VHA audit, I see that El Paso performs at 

the worst of all VHAs in the entire country for some categories like 

existing patient access to mental health, second to worst for specialty care, fourth to worst for specialty care, fourth to worst for 

new patient, and Fayetteville was nowhere near those. So what 

was the criteria that was used? 

Mr. MATKOVSKY. Fair question. Part of it, just to be candid was 

just working with the local facility. Now, if I can offer you just 

some comparable examples. 

El Paso, unlike Fayetteville, has roughly a third of its health 

care budget in non-VA care. That is largely because it offers really 

no inpatient services, right? So already a large share of its care is 

delivered through non-VA resources. So as a proportionate level, it 

is considerably higher using non-VA than is Fayetteville, proportionately. 

And then I think if you looked at their already existing spend 

pattern, they identified an additional 1.4, so I don’t know the proportional difference between Fayetteville’s overall budget and El 

Paso, but some of that went into it. 

Mr. *O’Rourke.* And I will return to the Chair, but before that 

I just wanted to ask, would you provide the Committee—because 

I am not the only member who is interested in this, we all want 

to make sure that the veterans that we serve are getting the care 

that they need—would you provide to the Committee a written response to the question how does the VA—what criteria does the VA 


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use to determine which local VHAs are going to get these additional resources? 

Mr. MATKOVSKY. I will produce it in writing, yes. 

Mr. *O’Rourke.* Thank you. 

Mr. BILIRAKIS. Thank you. They just called votes. 

I have one additional question and I am going to allow my ranking member to ask one question and then we will go ahead and adjourn. 

But the question for VA, the non-VA care program is overseen 

by the chief business office, yet CBO does not exercise direct line 

authority over non-VA care operations; that is my understanding. 

Who is responsible for accountability within the non-VA care program? 

Mr. MATKOVSKY. Well, I think there are two sets of responsibilities. The program has responsibility for policy, for establishing 

training, making sure that training is distributed and performing 

oversight functions. We are responsible in the program office for 

that. 

For claims payment, accuracy of those claims being paid, timely 

paid, coordinated care, and making sure that care gets delivered to 

veterans is through medical centers. I feel I have a direct personal 

accountability to this. I have been involved with this program now 

since 2012, focusing on the accuracy of the payment. It is something that we haven’t seen a lot of, but, you know, beginning in 

2012 until today we have seen an over 25 percent improvement in 

the payment accuracy. That was led by the CBO, but it was also 

led by the field. So it is a shared accountability, but none of us are 

shirking from it. 

Mr. BILIRAKIS. How many FTEs, total FTEs currently support 

the non-VA purchase care? 

Mr. MATKOVSKY. It is roughly one thousand, but there are—that 

is one thousand out of the CBO and then the facilities have other 

resources as well, sir. 

One thing that I would point out about the program, the VA runs 

almost a fee-for-service insurance program called CHAMPVA which 

is a little bit over a billion dollars where we provide for beneficiaries for veterans, basically a fee-for-service that mimics, quite 

frankly, TRICARE for them. So that is also wrapped in there, and 

we pay those claims directly out of our chief business office. We run 

the call center for that, et cetera. 

Mr. BILIRAKIS. Thank you. 

I will recognize Ms. Brown for one question. 

Ms. BROWN. Thank you. 

Mr. Williamson, my question is when a veteran gets emergency 

service, who is responsible for the reimbursement, is it the veteran 

or the facility? 

Mr. WILLIAMSON. The way it works is that the veteran gets the 

emergency care and the provider of that care, let’s say it is a hospital, sends a bill to VA. The VA claims processing staff at the applicable VA medical facility process the claim and pay the provider. 

The veteran doesn’t get involved with paying the provider unless 

VA denies the claims. 

Ms. BROWN. Mr. Matkovsky, my last question: As we move forward with the VA and the VA bill in the conference, I am still inVerDate Aug 31 2005 11:41 Oct 28, 2014 Jkt 000000 PO 00000 Frm 00099 Fmt 6633 Sfmt 6633 Y:\89373.TXT PAT

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terested in making sure that, you know, some people would push 

us further than I would ever go to privatize the system. I want to 

make sure that we have quality in the system and we make sure 

that the veterans get the care that they need. 

But wait time is an issue, so what is it that we can do with our 

stakeholders and partners to make sure that we keep the VA system intact because I am very interested in it. Someone mentioned 

DoD; DoD have their own problems and I understand that. The 

regular hospitals, you know, have their—they have problems. So 

there is no system that is perfect and I understand that. 

And if I don’t go to a certain appointment I am fined, you know, 

so how many of the veterans that we are talking about that didn’t 

show up, they said well they need to call or they could have had 

an emergency—so it is all of us working together. So what would 

you close—what word could you give me? 

Mr. MATKOVSKY. I would say to you, Congresswoman, that working together with this Committee, I think that we will work together in a much more transparent way to make VA a better system. We will use non-VA care where it is required based on when 

a veteran needs care, when, where and how, but one thing that we 

need to be clear about, I think the VA, it completes America’s 

promise, right? And if we do this right, if we work together, oversee 

this correctly, the Committee, the Agency, we can work for veterans. We can make this a transparent excellent organization. We 

have 300,000 dedicate staff out there who will make this work. 

I think if we open this, we deal openly with where we have challenges, balance the communication. Yes, we have some problems. 

Yes, we do some things great. Always the pair, hand in hand, we 

can help complete the promise. I just urge us to keep that in mind. 

Ms. BROWN. Thank you so very much and thank both of you for 

your service. 

Mr. BILIRAKIS. Thank you so much. Thank you for your testimony. 

And if there are no further questions, you are excused—oh, there 

is a question. 

Mr. *O’Rourke.* May I, Mr. Chairman? 

Mr. BILIRAKIS. Sure. You are recognized, Mr. O’Rourke. 

Mr. *O’Rourke.* All right. It will be a quick question. 

Mr. BILIRAKIS. Quickly. 

Mr. *O’Rourke.* You mentioned 64,000 who have not been able 

to get an appointment at all, we found in El Paso 36 percent of veterans seeking to make a mental health appointment were unable 

to obtain one at all. I hear anecdotally from veterans they call the 

VA, the VA says we can’t schedule you right now, call back in a 

year. 

So you can find the people who are in the system who tried to 

make an appointment and never received one, how are you going 

to reach those veterans who attempted to make an appointment 

and were never in the system at all? Will you publicize a 1–800 

number? Can we have it and advertise it? How do we reach these 

folks who haven’t been able to get an appointment? 

Mr. MATKOVSKY. Any veteran who is trying to get ahold of our 

system today, 1–877–222–VETS; that is our contact center in the 

Topeka, Kansas and Waco, Texas. I urge them to call us. We will 


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find it. We will figure out where you are and we will get you your 

appointment. 

Mr. *O’Rourke.* Great. Thank you. 

Mr. BILIRAKIS. Thank you. 

Okay. You are excused. I ask unanimous consent that all Members have five legislative days to revise and extend their remarks 

and include extraneous material. 

Without objection, so ordered. 

I would like to once again thank the witnesses and the audience, 

of course for joining us here this morning—it is afternoon now— 

and this hearing is now adjourned. 

[Whereupon, at 1:10 p.m. the committee was adjourned.] 


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APPENDIX 

STATEMENTS FOR THE RECORD 

Statement Of Raymond C. Kelley, Director 

National Legislative Service Veterans Of Foreign Wars Of The United States 

For The Record 

Committee On Veterans’ Affairs United States House Of Representatives 

With Respect To Non-VA Care: An Integrated Solution for Veteran Access 

June 18, 2014 

MR. CHAIRMAN AND MEMBERS OF THE COMMITTEE: 

On behalf of the men and women of the Veterans of Foreign Wars of the United 

States (VFW) and our Auxiliaries, I would like to thank you for the opportunity to 

submit for the record regarding non-VA health care. 

The recent events at the Phoenix VA Medical Center and the subsequent national 

audit of all VA facilities have shed light on the fact that many facilities lack the 

capacity to meet demand for care. This means that access is insufficient, leading to 

a diminished level of care, which in some cases could be life threatening for veterans 

in need of essential services and procedures. The VFW finds this absolutely unacceptable and appreciates the urgency with which Congress is acting to address this 

problem. 

VA must use all available tools to provide timely access to care, including nonVA care when necessary. Ideally, VA would have the capacity to provide timely, 

quality direct care to all those who need it. We know, however, that they currently 

do not. Although the VFW supports expanding VA infrastructure and hiring enough 

health care professionals to meet demand at Department facilities, we recognize 

that these improvements will not happen overnight. Veterans cannot be allowed to 

suffer in the meantime, and non-VA care must be used as a bridge between full access to direct care and where we are now. 

It is vitally important that VA remains the guarantor of care, wherever that care 

is provided. This means that VA facilities must refer veterans to community providers using a system that requires full coordination and guarantees access and 

quality. Under the old fee basis system, VA would issue veterans in need of nonVA care authorization letters. It would then be up to the veteran to shop this letter 

around, searching for a community provider who was willing to accept the authorization and could schedule an appointment in a timely manner. Following the appointment, the veteran would be responsible for returning any records to VA, in 

order to have them included in the veteran’s VA medical record. This system was 

entirely uncoordinated, failed to guarantee access or quality, and was highly susceptible to improper billing. 

The dangers of uncoordinated care are well documented. An April 2013 OIG report revealed the mismanagement of non-VA care at the Atlanta VAMC in which 

approximately 4,000 veterans were referred to non-VA mental health providers 

without an adequate tracking system. OIG found that this led to an average wait 

time of 92 days, with 21 percent of veterans receiving no care at all, and never receiving any follow up from the VAMC. Even VA staff admitted to OIG that, due to 

the large number of referrals, many veterans had ‘‘fallen through the cracks.’’ The 

lesson from Atlanta is clear: VA must not be allowed to push large numbers of veterans to outside providers without proper coordination simply to create the appearance that access is being provided. 

In order to address the problems of non-VA care, VA developed a new contract 

care model, Patient-Centered Community Care (PC3). Under this program, networks of specialty care providers were created across the country to provide care at 

pre-negotiated rates in a well-coordinated manner. According to VA, veterans will 

be referred to PC3 providers if direct care cannot be readily provided due to lack 

of available specialists, long wait times, or geographic inaccessibility. 

In theory, this program should help solve the access problems that have been 

plaguing many VA facilities. The program cannot succeed, however, if individual facilities are not open and honest about access to care issues and appointment wait 

time data continue to be unreliable. We believe that VA must develop and implement wait time standards that would trigger PC3 referrals, and enforce those standards at each facility. Rather than an arbitrary number of days, these wait time 

standards should be developed based on the type of care being provided and the immediacy of the individual veteran’s need for that care, based on a physician’s medical opinion. 

Although the VFW supports PC3, we will be watching its progress closely, and 

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tential. Specifically, we will want to know which facilities are using PC3 properly 

to reduce actual wait times, and which are not. If it appears that certain facilities 

are not making proper referrals due to improper training, lack of standards, or institutional resistance, VA must move swiftly to correct those problems. If PC3 is not 

being used effectively due to insufficient funding at the local level, we will call on 

VA and Congress to work together to get them the resources they need. 

The PC3 program is new, and we recognize that the capacity of its networks may 

not immediately be sufficient to provide timely access for all specialties. In addition, 

PC3 is not currently set up to provide primary care. Consequently, it may be necessary for some facilities to enter into local contracts for specific services. Under no 

circumstances should veterans be expected to coordinate their own care or be held 

responsible for record sharing when receiving care outside of VA. The VFW believes 

that all contracts should include provisions that ensure the same level of coordination, access, and quality as the PC3 contracts. Anything less would not only fail to 

address the access problems many VA facilities are facing, but would also represent 

a huge step backwards in the evolution of non-VA care. 

Mr. Chairman, this concludes my testimony and if you or the Committee has any 

questions, I would be happy to respond to them for the record. 


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LETTER FROM DAVID J. MCINTYRE, JR., CEO OF TRIWEST HEALTHCARE ALLIANCE

The Honorable Jeff Miller, Chairman, Committee on Veterans’ Affairs 

U.S. House of Representatives , Washington, DC 20515 

The Honorable Michael Michaud 

Ranking Minority Member 

Committee on Veterans’ Affairs 

U.S. House of Representatives 

Washington DC 20515 

Dear Chairman Miller and Ranking Member Michaud: 

I want to express my sincere appreciation for the opportunity to testify before 

your Committee on June 18, 2014. It was an honor to represent TriWest Healthcare 

Alliance before your distinguished panel. 

During the hearing, I was asked to answer ‘‘yes’’ or ‘‘no’’ in response to a question 

concerning whether VA pays Medicare rates to TriWest under the VA Patient-Centered Community Care (PC3) program. I answered ‘‘yes.’’ However, as the hearing 

progressed, it became clear that the question was whether we are provided reimbursement by VA at 100% of the Medicare rate. We are not. 

As such, I want to clarify my answer by making it clear that TriWest is not reimbursed by VA at 100% of the Medicare rate for health care services. While it is true 

that the reimbursements under PC3 are Medicare-based, which is why I responded 

in the affirmative, in general, VA reimburses TriWest at a discount off of the Medicare rate. The discount varies by type of service and the PC3 region to which it applies. However, with the exception of Region 6 (Alaska), reimbursements for health 

care services are at rates below Medicare. As such TriWest is incentivized – and 

indeed at risk – to obtain care from network providers at a discount off of 100% 

Medicare reimbursement. 

I hope this provides some clarification to my answer as well as some additional 

information that will be helpful to the Committee. Should you deem it appropriate, 

I would appreciate it if this clarification could be made a part of the hearing record. 

Respectfully, 

David J. McIntyre, Jr., President and CEO 

Chairman Miller and Ranking Member Michaud 

June 19, 2014 

QUESTIONS FOR THE RECORD 

The Honorable Sloan Gibson 

Acting Secretary 

U.S. Department of Veterans Affairs 

810 Vermont Avenue NW., Washington, DC 20420 

June 27, 2014 

Dear Mr. Secretary: 

Committee practice permits the hearing record to remain open to permit Members 

to submit additional questions to the witnesses. In reference to our Full Committee 

hearing entitled, ‘‘Non-VA Care: An Integrated Solution for Veteran Access’’ that 

took place on June 18, 2014, I would appreciate it if you could answer the enclosed 

hearing questions by the close of business on August 8, 2014. 

In preparing your responses to these questions, please provide your answers consecutively and single-spaced and include the full text of the question you are addressing in bold font. To facilitate the printing of the hearing record, please e-mail 

your response in a Word document, to Carol Murray at 

Carol.Murray@mail.house.gov by the close of business on August 8, 2014. If you 

have any questions please contact her at 202–225–9756. 

Sincerely, 

MICHAEL H. MICHAUD 

Ranking Member 

MHM:cm 

Question by Mike Michaud, Ranking Member 

1. From my conversations with the veterans in Maine, Project ARCH has been 

quite successful. Unfortunately the VA appears to be moving to close down this popular program. 

a. It is my understanding VA has authority to provide an extension of the program beyond August. Does the VA believe existing authority allows for an extension 

of the program? If so, will VA exercise that authority and continue the program? 


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b. In March this year, Under Secretary Petzel told me VA would ensure the continuation of services for those veterans participating in ARCH. You mentioned development of individual transition plans, please provide more detail on what these 

entail? What actions is VA taking to follow up on this promise? 

c. I understand the participating ARCH providers will receive lower reimbursement if they choose to enter the PC3 network. Is VA taking any action to facilitate 

the transition of ARCH providers into PC3? 

2. Please explain how the Non-VA Care Coordination program and PC3 interact 

or complement each other in the coordination of care for a veteran receiving nonVA care. 

3. I understand that PC3 requires a seven-step process. Can you detail the steps 

in this process and discuss any efforts VA has made to streamline the process going 

forward? 

4. In looking at data from FY 2013, FY 2012, and FY 2011, please provide the 

amount of monies, by VISN, available for obligation but not expended at the end 

of each fiscal year. In addition, if any VISN or facility within a VISN has not expended funds at the end of these fiscal years, has that fact been a consideration in 

terms of any evaluation of VHA personnel in regards to performance awards or bonuses. 5. What is the process for VA to timely pay non-VA providers? What are the current challenges to prompt payment? 

6. What do you believe are the top three challenges the Department faces to ensure effective and efficient standards and processes are in place so that veterans receive timely, quality, health care whether it is in a VA facility or non-VA care? 

Rep. O’Rourke 

1. Are VA Directors’ bonuses based on staying under budget? Are there disincentives in place that keep them from sending veterans into the community for care? 2. What criteria did VA consider when determining how to allocate the $300 million in carryover funds that went to specific medical centers? 

3. Precisely what data was measured in the document we were given on May 9th, 

versus the wait times measured and reported in the audit on June 9th? What consequences will there be for reporting false data? 

Questions Submitted by Ranking Member Michaud 

Question 1. From my conversations with the veterans in Maine, Project ARCH 

has been quite successful. Unfortunately the VA appears to be moving to close down 

this popular program. 

a. It is my understanding VA has authority to provide an extension of the program beyond August. Does the VA believe existing authority allows for an extension 

of the program? If so, will VA exercise that authority and continue the program? 

VA Response: Section 403 of Public Law 110–387 required that VA conduct a pilot 

program, called Project ARCH, under which the Secretary provides covered health 

services to covered Veterans through qualifying health care providers for a threeyear period, pursuant to contracts with qualifying non-Department health care providers for the provision of such services. 

Section 104 of Public Law 113–146 requires VA to extend the pilot program to 

August 7, 2016. At this time, VA is determining how to quickly implement section 

104 in order to continue to provide covered health services to eligible Veterans in 

the program. 

b. In March this year, Under Secretary Petzel told me VA would ensure the continuation of services for those veterans participating in ARCH. You mentioned development of individual transition plans, please provide more detail on what these 

entail? What actions is VA taking to follow up on this promise? 

VA Response: Section 104 of Public Law 113–146 requires VA to extend the pilot 

program to August 7, 2016. At this time, VA is determining how to quickly implement section 104 in order to continue to provide covered health services to eligible 

Veterans in the program. 

c. I understand the participating ARCH providers will receive lower reimbursement if they choose to enter the PC3 network. Is VA taking any action to facilitate 

the transition of ARCH providers into PC3? 

VA Response: The VA contractual relationship for PC3 is between VA and the two 

PC3 contractors, Health Net and TriWest. Each contractor is responsible for developing their own PC3 provider networks, and VA has no involvement in the development of prime to subcontractor relationships. 

Question 2. Please explain how the Non-VA Care Coordination program and PC3 

interact or complement each other in the coordination of care for a veteran receiving 

non-VA care. 


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VA Response: All non-VA medical care is to be authorized via the defined NonVA Care Coordination (NVCC) process. PC3 is one type of purchasing that can be 

done as part of non-VA medical care. The PC3 Authorization Process Guide (attached below) identifies the PC3 touch points with the NVCC Process Guides. 

Question 3. I understand that PC3 requires a seven-step process. Can you detail 

the steps in this process and discuss any efforts VA has made to streamline the 

process going forward? 

VA Response: Please see flow chart and corresponding narrative in the PC3 Authorization Process Guide attached above. We currently are establishing governance 

groups that will be gathering feedback from all elements of the PC3 process and 

looking for opportunities for improvements. 

Question 4. In looking at data from FY 2013, FY 2012, and FY 2011, please provide the amount of monies, by VISN, available for obligation but not expended at 

the end of each fiscal year. In addition, if any VISN or facility within a VISN has 

not expended funds at the end of these fiscal years, has that fact been a consideration in terms of any evaluation of VHA personnel in regards to performance 

awards or bonuses. 

VA Response: Please see spreadsheet below for monies not obligated at the end 

of each fiscal year. The attached spreadsheet displays by appropriation (Medical 

Services, Medical Support & compliance and Medical Facilities) the amount that 

Veterans Integrated Service Networks (VISNs) carried over from one fiscal year into 

the next fiscal year for FY 2011, FY 2012, and FY 2013. VA carryover amounts by 

account are never more than the carryover amount authorized by the Congress. 

A superior performance award is a one-time cash award that may be granted to 

an employee each year based on his/her rating of record provided that the rating 

of record is at the fully successful level (or equivalent) or above. VA’s performance 

appraisal program for employees appointed under Title 5 of the United States Code 

is approved by the Office of Personnel Management (OPM). For employees appointed under Title 38 of the United States Code (e.g., doctors, nurses), VA has a 

proficiency rating system governed by VA Handbook 5013. Under statute and regulation, VA may use an employee’s performance as a basis for pay, awards, development, retention, removal, and other personnel decisions. Cash awards, time off 

awards, suggestion awards and other honorary or non-monetary awards are also 

given to employees for other contributions, acts, service, or achievement that benefits the VA or the Federal government. They are not issued based on a performance 

rating but rather the overall value of the contribution. These would include on-thespot awards. 

Question 5. What is the process for VA to timely pay non-VA providers? What are 

the current challenges to prompt payment? 

VA Response: VA’s priority goal is to process a minimum of 90 percent of claims 

within 30 days of receipt and maintain an aged inventory of 80 percent less than 

30 days old. This data is reviewed on a weekly basis and action is taken as appropriate to resolve any issues that might be impacting claims processing. There have 

been a number of challenges in maintaining our goals to include an increase in the 

number of claims received, staffing shortages, and technology issues. In addition, 

claims are currently processed throughout VA in a decentralized model, which results in a great deal of variability. Steps have been taken to address these challenges while plans are underway to move to a centralized model, including improved 

technology to ensure continued sustainment. Ongoing success is driven by data 

analysis and trending to ensure we have early warning of potential problems. VA 

has established two remote claims processing teams that are able to provide claims 

processing assistance to decentralized locations that are experiencing difficulties. 

VA has seen a large improvement over the past several months in reaching our 

goals. Claims paid within 30 days have improved from 75 percent in December 2013 

to 

83 percent in June 2014. For inventory aged less than 30 days there has been 

an improvement from 63 percent in December 2013 to 79 percent as of July 14, 

2014. 

Question 6. What do you believe are the top three challenges the Department 

faces to ensure effective and efficient standards and processes are in place so that 

veterans receive timely, quality, health care whether it is in a VA facility or nonVA care? 

VA Response: VA is committed to addressing our top three challenges: 

* First, our process initiatives—using available resources to get Veterans off wait 

lists and into clinics, while also fixing our scheduling system. 

* Second, but simultaneously, our changes of leadership—addressing VA’s cultural 

issues, holding people accountable for willful misconduct or management negligence, 

and creating an environment of openness and transparency. 


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* Third, the resource challenge—making a compelling case for the resources needed to consistently deliver timely, high-quality healthcare. 

Questions Submitted by Congressman O’Rourke 

Question 1. Are VA Directors’ bonuses based on staying under budget? Are there 

disincentives in place that keep them from sending veterans into the community for 

care? 

VA Response: VA medical center directors’ performance awards are paid based on 

annual performance ratings. Ratings are based on each senior executive’s performance agreement. Every medical center director’s performance agreement includes a 

critical element of ‘‘business acumen,’’ which is a government-wide standard set by 

OPM. A station’s total yearly budget is comprised of General Purpose and Specific 

Purpose funds, augmented by alternative revenue from first- and third-party collections and sharing agreement partners. Once a facility’s budgetary total is determined using the above process, it must also be appropriately be divided among the 

three Medical Care budget accounts. Within these limitations, facility leaders are 

expected to develop and execute a resource management plan that integrates budget, human resources, and capital expenditures, including the proper execution of 

specific purpose funds. The VA and VISN budget processes are dynamic, requiring 

frequent budgetary adjustments throughout the year as care needs change or other 

operational issues arise. Part of effective management is carrying out the facility 

mission within the allocated resources. However, if resources need to be augmented 

or realigned between appropriations or facilities, this is accomplished by using a 

1.0–1.5 percent VISN reserve for contingencies. 

Senior Executives are expected to implement business processes in non-VA Care 

programs to ensure appropriate and timely non-VA care service provision as well 

as compliant claims processing. In addition, they are responsible for ensuring nonVA care payment accuracy through robust internal controls and independent compliance and business integrity reviews. VA has taken steps to ensure all VA health 

care leaders and managers clearly understand the following: (1) there are no financial disincentives to referring Veterans for non-VA health care; and (2) VA has robust funds to apply for such referrals. VA’s goal is to always provide timely, quality, 

and appropriate health care whether it is provided directly within VA facilities or 

through 

non-VA care in the community. 

Question 2. What criteria did VA consider when determining how to allocate the 

$300 million in carryover funds that went to specific medical centers? 

VA Response: VA leadership took a deliberate approach to the analysis and ultimate allocation of funding resources to provide timely and accurate support to maintain Veteran care. VHA directed facility-level reporting requirements that included 

current facility capacity constraints, productivity challenges, and resource needs. 

These reports were provided and subsequently analyzed. VHA then clarified and 

confirmed the resource needs derived in part from the facility analysis with VISN 

level financial representatives, to include Chief Financial Officers. This input ensured appropriate allocation of funding requests. Those requests were broken down 

into three categories: Medical Services – Personal; Medical Support and Compliance 

Services; Personnel and Medical Service – Non-VA Medical Care. Allocation of funds 

began on June 11, 2014, with VISN leadership allocating funds to their specific facilities based upon their individual funding needs. 

Question 3. Precisely what data was measured in the document we were given 

on May 9th, versus the wait times measured and reported in the audit on June 9th? 

What consequences will there be for reporting false data? 

VA Response: The May 9th report was a PowerPoint related to mental health 

only. 

It showed completed appointment wait time trending from March 2013 to March 

2014 for mental health. Below we provide clarification of the Accelerating Care Initiative Data Release of June 9, 2014. 

On June 9, 2014, in addition to posting information on the nationwide Access 

Audit, VA also released additional data from each facility regarding patient waiting 

times. 

The Pending Waiting Time Data (released on June 9) demonstrates the wait times 

for future appointments; Completed Waiting Time Data demonstrates the wait 

times for completed appointments – which is the data local facilities probably provided. The two datasets complement each other, and both datasets demonstrate that 

Veterans are waiting too long for the care they need. VA is taking action to accelerate care for the Veterans we serve and improve the way wait times are reported 

and monitored. 


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The facility average waiting times for patients that VA distributed on June 9, 

2014, predicts the availability of scheduled appointments in the future for Veterans 

on a given date. We call this the ‘‘Pending Waiting Time Data.’’ 

This has the advantage of providing a big-picture view of appointment availability 

and the capacity of the system to address the needs of Veterans who have not yet 

been seen in our clinics. 

The waiting times datasets that local VA facilities have typically used in the past 

are ‘‘Completed Waiting Time Data’’ based upon when appointments actually occurred (completed) and take into account appointments moved up, cancelled, 

rebooked and missed. 

In the weeks following the audit, VA has concentrated its efforts on the Accelerating Care Initiative in order to get Veterans off wait lists. As of August 15, 2014, 

we have reached out to over 266,000 Veterans to get them off wait lists and into 

clinics sooner. From May 16, 2014, through August 24, 2014, we have made over 

975,000 total referrals to non-VA care providers. We have also confirmed that 14- 

day access measures have been removed from all individual employee performance 

plans to eliminate any motive for inappropriate scheduling practices and behaviors. 

Regarding allegations of false reporting from VA employees, VA is already taking 

corrective action to address issues resulting from the audit. Appropriate personnel 

action will be taken on a case-by-case basis. 

Questions to Currato From Michaud 

COMMITTEE ON VETERANS’ AFFAIRS 

U.S. HOUSE OF REPRESENTATIVES 

FULL COMMITTEE HEARING 

‘‘Non-VA Care: An Integrated Solution for Veteran Access.’’ 

JUNE 18, 2014 

334 CANNON HOUSE OFFICE BUILDING 

Hon. Mike Michaud 

1. Regarding the Patient-Centered Community Care (PC3) program of the Department of Veterans Affairs: 

a. Have you experienced any difficulty in attracting providers? 

b. Have providers expressed any concerns regarding the VA’s reimbursement 

rates or promptness of payment? 

c. Do you have any concerns regarding the open-ended structure of the contracts 

and the ability of providers to address surges in demand? 

d. In your experience so far, what difficulties do you face in building networks of 

providers in rural areas? 

Responses From Currato to Michaud 

Hon. Michael H. Michaud, Ranking Member 

U.S. House of Representatives, Committee on Veterans’ Affairs 

334 Cannon House Office Building 

Washington, DC 20515 

August 8, 2014 

Dear Ranking Member Michaud, 

Please find attached the answers to your additional questions submitted in reference to my testimony before the Full Committee hearing entitled ‘‘Non-VA Care: 

An Integrated Solution for Veteran Access’’ which occurred on June 18, 2014. 

Thank you for the opportunity to testify before the committee and to answer your 

additional questions. Health Net remains committed to helping increase acces to 

care for our nation’s veterans through the Department of Veterans Affairs. 

Sincerely, 

Thomas Carrato 

President, Health Net Federal Services 

1. Regarding the Patient-Centered Community Care (PC3) program of the Department of Veterans Affairs: 

a) Have you experienced any difficulty in attracting providers? 

Currently, Health Net’s PC3 network contains over 39,000 providers across our 

three PC3 regions. In developing our network, we have had community providers, 

including providers that participate in our other government programs (e.g., 

TRICARE), express reluctance to work directly with VA based on previous experiences and/or perceptions of working directly with VA. The four most commonly cited 

concerns have been: 1) low levels of reimbursement; 2) extensive medical documentation required in time frames shorter than the provider’s office practice; 3) inaccurate, slow payment; and 4) the amount of care provided for which payment is 


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denied by VA. Health Net has worked with providers to address many of these perceived issues and has achieved success building the PC3 network in our regions. 

Since Health Net is the prime PC3 contractor in Regions 1, 2 and 4, we serve as 

a liaison between community providers and VA; it is our responsibility to provide 

clarity to providers regarding the expected performance of services and to pay network providers promptly and accurately. Health Net clearly defines the services to 

be delivered and the medical documentation to be returned for network care provided to Veterans. Health Net is able to leverage existing relationships we have 

with community providers to navigate the complex VA system in which each VA 

Medical Center has unique processes and requirements. When a provider has a concern or question about what is expected by the VAMC’s request, Health Net stands 

ready to obtain and provide clarifying guidance for the care to be given. 

1. Regarding the Patient-Centered Community Care (PC3) program of the Department of Veterans Affairs: 

(b): Have providers expressed any concerns regarding the VA’s reimbursement 

rates or promptness of payment? 

As discussed above, many providers have expressed concern with low levels of reimbursement tied to Medicare, the amount of administrative effort required to meet 

VA requirements, and the length of time it takes for VA to pay claims. Health Net, 

as the payor of PC3 network claims, is committed to paying providers within 30 

days. Part of our solution for PC3 is to simplify the administrative tasks required 

of network community providers, such as timely return of medical documentation 

to VA prior to VA reimbursing health care claims. Through these efforts, the Health 

Net network for PC3 continues to grow and expand in all areas. 

1. Regarding the Patient-Centered Community Care (PC3) program of the Department of Veterans Affairs: 

(c): Do you have any concerns regarding the open-ended structure of the contracts 

and the ability of providers to address surges in demand? 

The true value of PC3 is that it was designed to augment VA’s capacity to provide 

timely access to care for veterans, not duplicate or replace it. As a long-standing 

TRICARE contractor, we have extensive experience with tailoring and enhancing 

our networks to augment the specific needs of our customer, and with the leadership 

and assistance of the VA PC3 Program Management Office (PMO), our focus has 

been on doing exactly that for VA also. 

Since contract implementation in January 2014, Health Net has been collaborating with the VA PC3 Program Management Office and the Veterans Integrated 

Service Networks (VISNs) and VAMCs within our regions to build an efficient and 

effective PC3 network to meet the needs of each VAMC. The clear commitment of 

the VA PC3 PMO and the engagement of VAMC leadership have been key to our 

ability to identify, and then recruit, the types of specialty providers in greatest demand, as well as to identify projected gaps in VAMC capacity that will require specific services to be available through the PC3 network. 

In some cases, however, the current situation within the Veterans Health Administration, including the Accelerated Access to Care Initiative, is placing a strain on 

network capacity in specific specialties and in certain areas, particularly underserved and rural communities. This is further complicated by the fact that PC3 is 

a new program and network community providers are still adjusting to the specific 

requirements of PC3 and establishing the level of PC3 authorizations for which they 

are comfortable accepting. We view this as a short-term challenge and believe that, 

in the long term, the PC3 community networks will effectively adjust to meet local 

VA needs. 

1. Regarding the Patient-Centered Community Care (PC3) program of the Department of Veterans Affairs: 

(d) In your experience so far, what difficulties do you face in building networks 

of providers in rural areas? 

PC3 utilizes the same healthcare resources available in the broader community, 

whether urban, rural, or highly rural. Rural access is a national concern. Provider 

shortages exist in certain geographical areas of the country, as well as national 

availability in certain specialties to serve the U.S. population overall. 

An important component to ensuring adequate coverage in rural and underserved 

areas is to minimize administrative requirements that go above and beyond the 

community standards in those areas. PC3 does contain requirements that exceed 

these community standards. To encourage providers in these more challenging areas 

to participate in PC3, we are working hard to simplify the administrative tasks associated with meeting the requirements of PC3. 

Æ 


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