[Federal Register Volume 88, Number 249 (Friday, December 29, 2023)]
[Rules and Regulations]
[Pages 90120-90121]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2023-28726]


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DEPARTMENT OF VETERANS AFFAIRS

38 CFR Part 70

RIN 2900-AS03


Changes in Rates VA Pays for Special Modes of Transportation; 
Delay of Effective Date

AGENCY: Department of Veterans Affairs.

ACTION: Final rule; delay of effective date.

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SUMMARY: The Department of Veterans Affairs (VA) published in the 
Federal Register on February 16, 2023, a final rule to amend its 
beneficiary travel regulations to establish a new payment methodology 
for special modes of transportation available through the VA 
beneficiary travel program. The preamble of that final rule stated the 
effective date was February 16, 2024. This rulemaking delays that 
effective date to February 16, 2025.

DATES: The effective date for the final rule published February 16, 
2023, at 88 FR 10032, is delayed from February 16, 2024, until February 
16, 2025.

FOR FURTHER INFORMATION CONTACT: Ben Williams, Director, Veterans 
Transportation Program (15MEM), Veterans Health Administration, 
Department of Veterans Affairs, 810 Vermont Avenue NW, Washington, DC 
20420, (404) 828-5691. (This is not a toll-free number.)

SUPPLEMENTARY INFORMATION: On November 5, 2020, VA proposed amending 
its beneficiary travel regulations to implement the discretionary 
authority in 38 U.S.C. 111(b)(3)(C), which permits VA to pay the lesser 
of the actual charge for ambulance transportation or the amount 
determined by the Centers for Medicare and Medicaid Services (CMS) 
Medicare Part B Ambulance Fee Schedule (hereafter referred to the CMS 
ambulance fee schedule) established under section 1834(l) of the Social 
Security Act (42 U.S.C. 1395m(l)), unless VA has entered into a 
contract for that transportation. We provided a 60-day comment period 
that ended on January 4, 2021, and we received six comments, five of 
which were substantive. Those five comments all raised similar concerns 
to 38 CFR 70.30(a)(4) introductory text and (a)(4)(i) and (ii) as 
proposed, related to using the CMS ambulance fee schedule or, in the 
case of travel by modes other than ambulance, the posted rates from 
each State. We responded to all comments in a final rule published in 
the Federal Register on February 16, 2023 (88 FR 10032), wherein we 
stated that we would not make changes from the proposed rule related to 
application of the CMS ambulance fee schedule but would delay the 
effective date of the final rule by one year (to be February 16, 2024) 
to ensure that ambulance providers have adequate time to adjust to VA's 
new methodology for calculating ambulance rates (88 FR 10035). We 
further stated in the final rule that such adjustment could include 
ambulance providers entering negotiations with VA to contract for 
payment rates different than those under the CMS ambulance fee 
schedule, as contemplated in the final rule.
    Since publication of the final rule, however, VA has received 
feedback from both internal and external stakeholders, including VA 
employees, ambulance providers, and industry experts, that more time is 
necessary for successful implementation of the rule. Specifically, the 
delay of the effective date is necessary to accommodate unforeseen 
difficulties in air ambulance broker contracting. These difficulties 
relate to air ambulance brokers requiring a contract or subcontract in 
place with all potential air ambulance providers that covers emergency, 
non-VA initiated trips. Based on this feedback and evaluation of the 
continued effort that would be required by air ambulance brokers to 
negotiate and enter into contracts before February 16, 2024, VA is 
delaying the effective date of the regulation by one year. VA believes 
a 12-month delay is appropriate based on its experience with 
contracting, especially in circumstances like this where subcontracting 
actions are required.

Administrative Procedure Act

    The Administrative Procedure Act (APA), codified in part at 5 
U.S.C. 553, generally requires that agencies publish substantive rules 
in the Federal Register for notice of proposed rulemaking and to 
solicit public comment. However, pursuant to 5 U.S.C. 553(b)(B) of the 
APA, general notice and the opportunity for public comment are not 
required with respect to a rulemaking when an ``agency for good cause 
finds (and incorporates the finding and a brief statement of reasons 
therefor in the rules issued) that notice and public procedure thereon 
are impracticable, unnecessary, or contrary to the public interest.''
    VA finds that there is good cause under the APA to issue this rule 
without prior notice and opportunity for public comment. The final rule 
published at 88 FR 10032 will become effective February 16, 2024. Given 
the

[[Page 90121]]

imminence of the effective date, seeking prior notice and the 
opportunity for public comment on this delay is impractical. 
Specifically, if prior notice and opportunity for public comment are 
required to delay the effective date to February 16, 2025, this final 
rule will not be issued prior to February 16, 2024. As a result, the 
current final rule will become effective February 16, 2024, and 
ambulance providers without contracts in place would be subject to 
those payment methodologies until contracts have been implemented. For 
those entities engaged in the contracting process, this is likely to 
cause confusion and uncertainty.
    VA also finds that prior notice and opportunity for comment would 
be contrary to the public interest because it could adversely impact 
veteran care or result in veterans being billed directly for services. 
Under the new regulation, VA will pay the lesser of actual charge 
associated with an air ambulance service, or the CMS ambulance fee 
schedule rate for that service, unless a separate rate has been 
established based on local contracts between air ambulance providers 
and local VA medical centers. As discussed above, since publication of 
the final rule, VA has received feedback that more time is necessary to 
accommodate unforeseen difficulties in air ambulance broker 
contracting, which relate to air ambulance brokers requiring a contract 
or subcontract in place with all potential air ambulance providers that 
covers emergency, non-VA initiated trips. The negotiation and 
implementation of these contracts will not be completed by February 16, 
2024. As a result, absent the delayed effective date, the current final 
rule will go into effect on February 16, 2024, and ambulance providers 
would be subject to those payment methodologies until contracts have 
been implemented. This could be especially concerning for those 
entities whose negotiated rates could be higher than the applicable CMS 
ambulance fee schedule rate in the event VA determines it may be 
justified based on local considerations, such as for rural areas. Air 
ambulance providers contend that the Medicare reimbursement rate that 
would apply absent a contract is unsustainable for their business 
operations, potentially leading to reduction in the availability of air 
ambulance services for veterans. While VA is not aware that veterans 
are currently receiving preferential treatment from air ambulance 
providers by virtue of VA paying billed charges, or that such 
preferential treatment would stop were VA to pay CMS ambulance fee 
schedule rates in the absence of a contract, VA acknowledges that there 
is a risk that veterans could be billed directly for the difference 
between the Medicare rate that VA pays for emergency, non-VA initiated 
trips and the amount billed by the ambulance provider. For these 
reasons, VA finds that good cause exists to dispense with the prior 
notice and public comment procedures for this final rule, as it 
concludes that such procedures are impracticable and contrary to the 
public interest pursuant to 5 U.S.C. 553(b)(B).

Signing Authority

    Denis McDonough, Secretary of Veterans Affairs, approved and signed 
this document on December 22, 2023, and authorized the undersigned to 
sign and submit the document to the Office of the Federal Register for 
publication electronically as an official document of the Department of 
Veterans Affairs.

Jeffrey M. Martin,
Assistant Director, Office of Regulation Policy & Management, Office of 
General Counsel, Department of Veterans Affairs.
[FR Doc. 2023-28726 Filed 12-28-23; 8:45 am]
BILLING CODE 8320-01-P