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###### Department of Veterans Affairs

          - 38 CFR Part 17
          - RIN 2900-AS25

# AGENCY:

Department of Veterans Affairs.

# ACTION:

Proposed rule.

# SUMMARY:

The Department of Veterans Affairs (VA) proposes to amend its medical regulations to allow VA to initiate a waiver request for debt accumulated from health care copayments on behalf of veterans in certain circumstances and to remove the requirement that veterans submit VA Form 5655 when seeking a waiver of copayment debt.

# DATES:

Comments must be received on or before February 18, 2025.

# ADDRESSES:

                        Comments must be submitted through                         *www.regulations.gov.*                         Except as provided below, comments received before the close of the comment period will be available at                         *www.regulations.gov*                         for public viewing, inspection, or copying, including any personally identifiable or confidential business information that is included in a comment. We post the comments received before the close of the comment period on                         *www.regulations.gov*                         as soon as possible after they have been received. VA will not post public comments on                         *www.regulations.gov*                         that make threats to individuals or institutions or suggest that the commenter will take actions to harm an individual. VA encourages individuals not to submit duplicative comments. We will post acceptable comments from multiple unique commenters even if the content is identical or nearly identical to other comments. Any public comment                               ( print page 102032)                            received after the comment period's closing date is considered late and will not be considered in the final rulemaking. In accordance with the Providing Accountability Through Transparency Act of 2023, a plain language summary (not more than 100 words in length) of this proposed rule is available at                         *www.regulations.gov,*                         under RIN 2900-AS25.                    

# FOR FURTHER INFORMATION CONTACT:

Andrew Patrick, Executive Director, Revenue Operations, Office of Finance, (104RO), Veterans Health Administration, Department of Veterans Affairs, 810 Vermont Ave. NW, Washington DC 20420, (202) 809-3030. (This is not a toll-free telephone number.)

# SUPPLEMENTARY INFORMATION:

## Authority and Background

Section 1710 of title 38, United States Code (U.S.C.) requires VA to furnish hospital care and medical services, and authorizes VA to provide nursing home care, that VA determines to be needed for eligible veterans. Section 1710 authorizes VA to provide such care only when the veteran agrees to pay the applicable copayment. 38 U.S.C. 1710(f)(1) and (g)(1). Additionally, section 1722A establishes that VA must require a copayment from certain veterans for medications. VA has set forth copayment requirements for inpatient hospital care and outpatient medical care in § 17.108 of title 38, Code of Federal Regulations (CFR), copayment requirements for medication in § 17.110, copayments for extended care services in § 17.111, and copayments for urgent care at § 17.4600. These types of medical copayments are generally referred to as “copayments” throughout this rulemaking.

Under 31 U.S.C. 3711(a)(1), Federal agencies are required to “try to collect a claim of the United States Government for money or property arising out of the activities of, or referred to, the agency,” which means that VA must attempt to collect amounts owed by veterans to VA, including debts arising from copayments. However, VA is authorized to waive recovery of payments or overpayments of benefits, including copayments, when recovery would be against equity and good conscience and an application for relief is made within 180 days from the date of notification of the indebtedness by VA. 38 U.S.C. 5302(a)(1). VA has regulated the waiver of debts arising from medical copayments in 38 CFR 17.105(c). VA has also regulated the process for waiver applications in 38 CFR 1.963(b), the process to request a hearing in § 1.966(a), and the application of the “equity and good conscience” standard in §§ 1.965 and 1.966(a).

Explained in more detail below, VA proposes to amend § 17.105(c) to: remove the requirement to submit a particular form when requesting a waiver of charges for copayments; add the ability for VA to initiate waiver requests on behalf of veterans; update VA staff position titles; and clarify the applicability of other regulations related to appeals of VA decisions on the waiver of copayments. These changes would provide clarity within the regulation, be consistent with the statutory authority for collection of copayments and waiver of copayments, reflect the current position title used by VA, and update cross-references to other regulatory sections.

We note at the outset that current § 17.105(c) references only claimants, not veterans. In the proposed changes to § 17.105(c) discussed below, we would include references to both claimants and veterans. We would maintain the existing references to claimants when discussing the process for anyone other than VA to initiate a waiver request for charges of copayments, and we would use the word veteran when discussing the process whereby VA would initiate a request for waiver on behalf of a veteran.

## Changes to 38 CFR 17.105(c)

In this rulemaking we propose to amend 38 CFR 17.105(c) related to waivers for copayments. We would first restructure current § 17.105(c) by breaking the single paragraph into proposed subparagraphs (c)(1) through (5), which would retain the majority of the language in current paragraph (c), but the further subparagraphs would make the proposed substantive and technical changes clearer.

The first sentence of current § 17.105(c) introduces the process for requesting a waiver of charges for copayments and states that “[if] the debt represents charges for outpatient medical care, inpatient hospital care, medication or extended care services copayments made under §§ 17.108, 17.110, 17.111, or 17.4600, the claimant must request a waiver by submitting VA Form 5655 (Financial Status Report) to the Consolidated Patient Account Center (CPAC) Chief Financial Officer.” We would retain this sentence as a standalone proposed § 17.105(c), with the following revisions.

We would first add the phrase “urgent care” to the list of debts from charges for care authorized to be waived. Current § 17.105(c) does not include the phrase urgent care but does include reference to § 17.4600, which addresses copayments for urgent care. Therefore, to ensure a complete and parallel listing of all applicable care types, we would add the phrase “urgent care” to qualify § 17.4600.

We would then add language in proposed § 17.105(c) to establish that VA may initiate a waiver request in addition to a “claimant.” This change would be necessary because VA recognizes that situations may arise where it would be more equitable and efficient for VA staff to initiate waiver requests on behalf of veterans. We would not propose to list specific situations in which VA may initiate a waiver, so that VA may retain greater flexibility in assessing what we believe would be novel circumstances. However, one example for when VA might initiate a waiver request would be in cases of VA error, particularly when large groups of veterans are impacted by the same VA error or errors.

Proposed § 17.105(c) would remove the requirement in current § 17.105(c) that claimants must submit VA Form 5655 to request a waiver of charges of copayments. VA Form 5655 is a two-page form that requires each claimant provide detailed information regarding monthly expenses, debts, and other financial information. VA now finds that this level of specificity can be burdensome to the claimant and is often more information than VA requires to make a waiver determination. VA would still regulate other criteria for submission of waiver requests, but the requirement would be moved to proposed § 17.105(c)(1).

Lastly, proposed § 17.105(c) would move the requirement that the form be sent to the Chief Financial Officer to § 17.105(c)(1)(ii), and in that provision, change the position title from “Chief Financial Officer” to “Chief Fiscal Officer” to reflect the current position title. This is merely a technical change and would not change the process to submit a waiver or to whom the request is submitted.

                    For the reasons stated above, proposed § 17.105(c) would read: “                    *Of charges for copayments.*                     If the debt represents charges for outpatient medical care, inpatient hospital care, medication, extended care services, or urgent care copayments made under §§ 17.108, 17.110, 17.111, or 17.4600, either a claimant or VA may initiate a waiver request.”                

                    Proposed § 17.105(c)(1) would establish requirements for claimants to submit requests for waiver of charges of copayments. Proposed paragraph (c)(1) would establish introductory language to state “[i]f the claimant requests a                           ( print page 102033)                        waiver, the claimant must:” where proposed subparagraphs (c)(1)(i)-(iv) would establish the specific criteria for a waiver request.                

The criteria in proposed paragraphs (c)(1)(i), (ii), and (iv) would remain the same as those listed in current § 17.105(c), with the exceptions of the requirement to submit VA Form 5655 and changing the title of the CPAC Chief Financial Officer to the Chief Fiscal Officer.

Proposed § 17.105(c)(1)(i) would establish that claimants must make the request within the time period provided in § 1.963(b) of this chapter. This is identical to the submission timeframe in current § 17.105(c) as VA finds it is still sufficient for purposes of waiver requests for copayments.

Proposed § 17.105(c)(1)(ii) would establish that claimants submit the request for waiver in writing to the Consolidated Patient Account Center (CPAC) Chief Fiscal Officer. We reiterate that removing the requirement for every claimant to submit VA Form 5655 would reduce burden for most claimants and eliminate requests for information that is not relevant for VA to determine whether to grant waiver requests. Therefore, as we would no longer be requiring a certain form, we would state that the request must be in writing in accordance with §§ 1.911(c)(2), 1.912(c)(2) and 1.912a(c)(2). As discussed below, the proposed removal of the requirement to submit VA Form 5655 would not prevent VA from requesting VA Form 5655, or other information, from a claimant after submission of the initial waiver request if, in the course determining whether a waiver will be granted, VA determines more information is needed to make a waiver determination.

To ensure that VA has the information required to make determinations related to waiver requests, proposed § 17.105(c)(1)(iii) would state that claimants must provide any additional information that VA may request to determine whether the waiver request will be granted. This requirement is not expressly stated in current § 17.105(c), but is consistent with VA practice.

Proposed § 17.105(c)(1)(iv) would direct claimants to request a hearing under § 1.966(a) of this chapter if a hearing is desired. This requirement is identical to what is stated in current § 17.105(c), as VA finds it is still sufficient for purposes of waiver requests for copayments.

Proposed § 17.105(c)(2) would establish requirements for VA to submit requests for waivers on behalf of veterans. VA believes that in certain circumstances it would be beneficial to veterans and VA if VA were permitted to submit requests for waivers on behalf of veterans. Proposed paragraph (c)(2) would provide that when VA requests a waiver on behalf of a veteran, VA would meet the criteria further outlined in proposed paragraphs (c)(2)(i)-(iv). The criteria in proposed § 17.105(c)(2)(i)-(iii) would essentially mirror the criteria required of claimants under proposed (c)(1)(i), (ii), and (iv). The waiver request requirements in proposed § 17.105(c)(2)(i)-(iii) are again substantively the same as those stated in current § 17.105(c), with the exceptions of the requirement to submit a particular VA form, and the change in title of the CPAC Chief Financial Officer to the Chief Fiscal Officer.

Proposed § 17.105(c)(2)(i) would state that VA must make the request within the time period provided in § 1.963(b) of this chapter, and proposed paragraph (c)(2)(ii) would direct VA to submit the waiver request to the designated CPAC Chief Fiscal Officer. Both of these requirements are consistent with what is stated in current § 17.105(c) and proposed paragraphs (c)(1)(i) and (c)(1)(ii), in terms of requirements for claimants' submission of waiver requests.

Proposed § 17.105(c)(2)(iii) would establish that VA must notify the veteran in writing that a request has been made on their behalf and that the veteran may request a hearing pursuant to § 1.966(a). The proposed requirement that VA notify the veteran when a waiver request has been initiated on their behalf is not in current § 17.105(c) because the process for VA to do so is newly proposed in this rulemaking. However, VA would ensure that the veteran is notified, in writing, so that way veterans are aware that VA has initiated a waiver request for the debt and that the veteran has the right to a hearing on the request under § 1.966(a).

Proposed § 17.105(c)(2)(iv) would state that VA may request any additional information from the veteran that may be required to determine whether the waiver will be granted. Although this requirement is also not stated in current § 17.105(c), it reflects current VA practice, and it is included in proposed § 17.105(c)(1)(iii) as applicable to claimants who request a waiver. It is necessary to ensure VA has sufficient information by which to determine whether or not a waiver request should be granted.

Proposed § 17.105(c)(3) would state that the CPAC Chief Fiscal Officer may extend the time period to submit a waiver request if the Chairperson of the Committee on Waivers and Compromises could do so under § 1.963(b) of this chapter. This language would be consistent with current § 17.105(c), except that proposed paragraph (c)(3) uses the term “waiver request” instead of the term “claim.” Using the term “waiver request” would be consistent with the terminology used in part 1 of Title 38, CFR, and referenced throughout this rulemaking, while not substantively changing the meaning of the provision.

Proposed § 17.105(c)(4) would contain the standard of review for waiver requests, and would state that the CPAC Chief Fiscal Officer will apply the “equity and good conscience” standard in accordance with §§ 1.965 and 1.966(a) of this chapter, and may waive all or part of the claimant's debts. This language would be identical to that in current § 17.105(c).

Lastly, proposed § 17.105(c)(5) would establish that a decision by the CPAC Chief Fiscal Officer under this provision is final (except that the decision may be reversed or modified based on new and material evidence, fraud, a change in law or interpretation of law, or clear and unmistakable error shown by the evidence in the file at the time of the prior decision, as provided in § 1.969 of this chapter) and may be appealed in accordance with 38 CFR parts 19 and 20 as applicable. This language would be consistent with current § 17.105(c), except that proposed paragraph (c)(5) would include the words “as applicable” to more clearly qualify that either or both 38 CFR parts 19 and 20 may apply for purposes of appealing VA's decisions related to waiver requests.

## Executive Orders 12866, 13563, and 14094

Executive Order 12866 (Regulatory Planning and Review) directs agencies to assess the costs and benefits of available regulatory alternatives and, when regulation is necessary, to select regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety effects, and other advantages; distributive impacts; and equity). Executive Order 13563 (Improving Regulation and Regulatory Review) emphasizes the importance of quantifying both costs and benefits, reducing costs, harmonizing rules, and promoting flexibility. Executive Order 14094 (Executive Order on Modernizing Regulatory Review) supplements and reaffirms the principles, structures, and definitions governing contemporary regulatory review established in Executive Order 12866 of September 30, 1993 (Regulatory Planning and Review), and Executive Order 13563 of January                           ( print page 102034)                        18, 2011 (Improving Regulation and Regulatory Review). The Office of Information and Regulatory Affairs has determined that this rule is not a significant regulatory action under Executive Order 12866, as amended by Executive Order 14094. The Regulatory Impact Analysis associated with this rulemaking can be found as a supporting document at                     *www.regulations.gov.*

## Regulatory Flexibility Act (RFA)

The Secretary hereby certifies that this proposed rule would or not have a significant economic impact on a substantial number of small entities as they are defined in the Regulatory Flexibility Act (5 U.S.C. 601-612). The factual basis for this certification is that this proposed rule impacts only VA staff and veterans, and thus no small entities will be affected. Therefore, pursuant to 5 U.S.C. 605(b), the initial and final regulatory flexibility analysis requirements of 5 U.S.C. 603 and 604 do not apply.

## Unfunded Mandates

The Unfunded Mandates Reform Act of 1995 requires, at 2 U.S.C. 1532, that agencies prepare an assessment of anticipated costs and benefits before issuing any rule that may result in the expenditure by State, local, and tribal governments, in the aggregate, or by the private sector, of $100 million or more (adjusted annually for inflation) in any one year. This proposed rule would have no such effect on State, local, and tribal governments, or on the private sector.

## Paperwork Reduction Act (PRA)

Although this proposed rule contains a collection of information under the provisions of the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3521), there are no provisions associated with this rulemaking constituting any new collection of information or any revisions to the current collection of information. The collection of information for 38 CFR 17.105(c) is currently approved by the Office of Management and Budget (OMB) and has a valid OMB control number of 2900-0165.

# List of Subjects in 38 CFR Part 17

      - Administrative practice and procedure
      - Claims
      - Health care
      - Veterans

## Signing Authority

Denis McDonough, Secretary of Veterans Affairs, signed and approved this document on December 5, 2024, 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.

Consuela Benjamin,

Regulation Development Coordinator, Office of Regulation Policy & Management, Office of General Counsel, Department of Veterans Affairs.

For the reasons stated in the preamble, the Department of Veterans Affairs proposes to amend 38 CFR part 17 as set forth below:

# PART 17—MEDICAL

1. The authority citation for part 17 continues to read as follows: 

Authority:38 U.S.C. 501, and as noted in specific sections.

* * * * *

2. Amend § 17.105 by revising paragraph (c) to read as follows: 

§ 17.105

* * * * *

                        (c)                         *Of charges for copayments.*                         If the debt represents charges for outpatient medical care, inpatient hospital care, medication, extended care services, or urgent care copayments made under §§ 17.108, 17.110, 17.111, or 17.4600, either a claimant or VA may initiate a waiver request.                    

(1) If the claimant requests the waiver, the claimant must:

(i) Make the request within the time period provided in § 1.963(b) of this chapter.

(ii) Submit the request in writing to the Consolidated Patient Account Center (CPAC) Chief Fiscal Officer.

(iii) Provide any additional information that VA may request to determine whether the waiver will be granted.

(iv) Request a hearing under § 1.966(a) of this chapter if a hearing is desired.

(2) If VA requests a waiver on behalf of a veteran, VA will:

(i) Make the request within the time period provided in § 1.963(b) of this chapter.

(ii) Submit the request in writing to the designated CPAC Chief Fiscal Officer.

(iii) Notify the veteran in writing that a waiver request has been made on the veteran's behalf and that the veteran may request a hearing pursuant to § 1.966(a).

(iv) Request any additional information from the veteran that may be required to determine whether the waiver will be granted.

(3) The CPAC Chief Fiscal Officer may extend the time period to submit a waiver request if the Chairperson of the Committee on Waivers and Compromises could do so under § 1.963(b) of this chapter.

(4) The CPAC Chief Fiscal Officer will apply the “equity and good conscience” standard in accordance with §§ 1.965 and 1.966(a) of this chapter, and may waive all or part of the claimant's debts.

(5) A decision by the CPAC Chief Fiscal Officer under this provision is final (except that the decision may be reversed or modified based on new and material evidence, fraud, a change in law or interpretation of law, or clear and unmistakable error shown by the evidence in the file at the time of the prior decision, as provided in § 1.969 of this chapter) and may be appealed in accordance with 38 CFR parts 19 and 20, as applicable.

* * * * *

[FR Doc. 2024-28999 Filed 12-16-24; 8:45 am]

BILLING CODE 8320-01-P