To amend title 38, United States Code, to improve the process by which the Secretary of Veterans Affairs pays non-Department of Veterans Affairs health care providers for hospital care or medical services furnished to veterans pursuant to the laws administered by the Secretary.

SECTION 1. PAYMENT OF NON-DEPARTMENT OF VETERANS AFFAIRS HEALTH CARE 
              PROVIDERS.

    (a) Payment of Providers.--
            (1) In general.--Subchapter I of chapter 17 of title 38, 
        United States Code is amended by inserting after section 1703 
        the following new section:
``Sec. 1703A. Payment of non-Department health care providers
    ``(a) Prompt Payment Compliance.--The Secretary shall ensure that 
payments made to non-Department health care providers, including under 
the Veterans Choice Program established by section 101 of the Veterans 
Access, Choice, and Accountability Act of 2014 (Public Law 113-146; 38 
U.S.C. 1701 note), comply with chapter 39 of title 31 (commonly 
referred to as the `Prompt Payment Act') and the requirements of this 
section. If there is a conflict between the requirements of the Prompt 
Payment Act and the requirements of this section, the Secretary shall 
comply with the requirements of this section.
    ``(b) Payment Schedule.--(1) The Secretary shall reimburse a non-
Department health care provider for care or services furnished under 
the laws administered by the Secretary--
            ``(A) in the case of a clean claim submitted to the 
        Secretary electronically, not later than 30 days after 
        receiving the claim; or
            ``(B) in the case of a clean claim submitted to the 
        Secretary in a manner other than electronically, not later than 
        45 days after receiving the claim.
    ``(2)(A) If the Secretary determines that a claim received from a 
non-Department health care provider is a non-clean claim, the Secretary 
shall submit to the provider, not later than 10 days after receiving 
the claim--
            ``(i) a notification that the claim is a non-clean claim;
            ``(ii) an explanation of why the claim has been determined 
        to be a non-clean claim; and
            ``(iii) an identification of the information or 
        documentation that is required to make the claim a clean claim.
    ``(B) If the Secretary does not comply with the requirements of 
subparagraph (A) with respect to a claim, the claim shall be deemed a 
clean claim for purposes of paragraph (1).
    ``(3) Upon receipt by the Secretary of information or documentation 
described in subparagraph (A)(iii) with respect to a claim, the 
Secretary shall reimburse a non-Department health care provider--
            ``(A) in the case of a claim submitted to the Secretary 
        electronically, not later than 30 days after receiving such 
        information or documentation; or
            ``(B) in the case of claim submitted to the Secretary in a 
        manner other than electronically, not later than 45 days after 
        receiving such information or documentation.
    ``(4) If the Secretary fails to comply with the deadlines for 
payment set forth in this subsection with respect to a claim, interest 
shall accrue on the amount owed under such claim in accordance with 
section 3902 of title 31.
    ``(c) Information and Documentation Required.--(1) Pursuant to 
regulations prescribed by the Secretary, the Secretary shall provide to 
non-Department health care providers that furnish hospital care or 
medical services to veterans pursuant to the laws administered by the 
Secretary information and documentation that is required to establish a 
clean claim under this section.
    ``(2) The Secretary shall consult with entities in the health care 
industry, in the public and private sector, to determine the 
information and documentation to include in the list under paragraph 
(1).
    ``(d) Electronic Claim Submittal.--On and after January 1, 2019, 
the Secretary shall not accept any claim under this section that is 
submitted to the Secretary in a manner other than electronically.
    ``(e) Definitions.--In this section:
            ``(1) The term `clean claim' means a claim for 
        reimbursement for hospital care or medical services furnished 
        by non-Department health care providers to veterans pursuant to 
        the laws administered by the Secretary, on a nationally 
        recognized standard format, that includes the information and 
        documentation necessary to adjudicate the claim.
            ``(2) The term `non-clean claim' means a claim for 
        reimbursement for hospital care or medical services furnished 
        by non-Department health care providers to veterans pursuant to 
        the laws administered by the Secretary, on a nationally 
        recognized standard format, that does not include the 
        information and documentation necessary to adjudicate the 
        claim.''.
            (2) Clerical amendment.--The table of sections at the 
        beginning of chapter 17 of such title is amended by inserting 
        after the item related to section 1703 the following new item:

``1703A. Payment of non-Department health care providers.''.
    (b) Electronic Submittal of Claims for Reimbursement.--
            (1) Prohibition on acceptance of non-electronic claims.--
                    (A) In general.--Except as provided in subparagraph 
                (B), on and after January 1, 2019, the Secretary of 
                Veterans Affairs shall not accept any claim for 
                reimbursement under section 1703A of title 38, United 
                States Code, as added by subsection (a), that is 
                submitted to the Secretary in a manner other than 
                electronically, including medical records in connection 
                with such a claim.
                    (B) Exception.--If the Secretary determines that 
                accepting claims and medical records in a manner other 
                than electronically is necessary for the timely 
                processing of claims for reimbursement under such 
                section 1703A due to a failure or malfunction of the 
                electronic interface established under paragraph (2), 
                the Secretary--
                            (i) may accept claims and medical records 
                        in a manner other than electronically for a 
                        period not to exceed 90 days; and
                            (ii) shall submit to the Committee on 
                        Veterans' Affairs of the Senate and the 
                        Committee on Veterans' Affairs of the House of 
                        Representatives a report setting forth--
                                    (I) the reason for accepting claims 
                                and medical records in a manner other 
                                than electronically;
                                    (II) the duration of time that the 
                                Department of Veterans Affairs will 
                                accept claims and medical records in a 
                                manner other than electronically; and
                                    (III) the steps that the Department 
                                is taking to resolve such failure or 
                                malfunction.
            (2) Electronic interface.--
                    (A) In general.--Not later than January 1, 2019, 
                the Chief Information Officer of the Department of 
                Veterans Affairs shall establish and make operational 
                an electronic interface for health care providers to 
                submit claims for reimbursement under such section 
                1703A.
                    (B) Functions.--The electronic interface 
                established under subparagraph (A) shall include the 
                following functions:
                            (i) A function through which a health care 
                        provider may input all relevant data required 
                        for claims submittal and reimbursement.
                            (ii) A function through which a health care 
                        provider may upload medical records to 
                        accompany a claim for reimbursement.
                            (iii) A function through which a health 
                        care provider may ascertain the status of a 
                        pending claim for reimbursement that--
                                    (I) indicates whether the claim is 
                                a clean claim or a non-clean claim; and
                                    (II) in the event that a submitted 
                                claim is indicated as a non-clean 
                                claim, provides--
                                            (aa) an explanation of why 
                                        the claim has been determined 
                                        to be a non-clean claim; and
                                            (bb) an identification of 
                                        the information or 
                                        documentation that is required 
                                        to make the claim a clean 
                                        claim.
                            (iv) A function through which a health care 
                        provider is notified when a claim for 
                        reimbursement is accepted or rejected.
                            (v) Such other features as the Secretary 
                        considers necessary.
                    (C) Protection of information.--
                            (i) In general.--The electronic interface 
                        established under subparagraph (A) shall be 
                        developed and implemented based on industry-
                        accepted information security and privacy 
                        engineering principles and best practices and 
                        shall provide for the following:
                                    (I) The elicitation, analysis, and 
                                prioritization of functional and 
                                nonfunctional information security and 
                                privacy requirements for such 
                                interface, including specific security 
                                and privacy services and architectural 
                                requirements relating to security and 
                                privacy based on a thorough analysis of 
                                all reasonably anticipated cyber and 
                                noncyber threats to the security and 
                                privacy of electronic protected health 
                                information made available through such 
                                interface.
                                    (II) The elicitation, analysis, and 
                                prioritization of secure development 
                                requirements relating to such 
                                interface.
                                    (III) The assurance that the 
                                prioritized information security and 
                                privacy requirements of such 
                                interface--
                                            (aa) are correctly 
                                        implemented in the design and 
                                        implementation of such 
                                        interface throughout the system 
                                        development lifecycle; and
                                            (bb) satisfy the 
                                        information objectives of such 
                                        interface relating to security 
                                        and privacy throughout the 
                                        system development lifecycle.
                            (ii) Definitions.--In this subparagraph:
                                    (I) Electronic protected health 
                                information.--The term ``electronic 
                                protected health information'' has the 
                                meaning given that term in section 
                                160.103 of title 45, Code of Federal 
                                Regulations, as in effect on the date 
                                of the enactment of this Act.
                                    (II) Secure development 
                                requirements.--The term ``secure 
                                development requirements'' means, with 
                                respect to the electronic interface 
                                established under subparagraph (A), 
                                activities that are required to be 
                                completed during the system development 
                                lifecycle of such interface, such as 
                                secure coding principles and test 
                                methodologies.
            (3) Analysis of available technology for electronic 
        interface.--
                    (A) In general.--Not later than January 1, 2018, or 
                before entering into a contract to procure or design 
                and build the electronic interface described in 
                paragraph (2) or making a decision to internally design 
                and build such electronic interface, whichever occurs 
                first, the Secretary shall--
                            (i) conduct an analysis of commercially 
                        available technology that may satisfy the 
                        requirements of such electronic interface set 
                        forth in such paragraph; and
                            (ii) submit to the Committee on Veterans' 
                        Affairs of the Senate and the Committee on 
                        Veterans' Affairs of the House of 
                        Representatives a report setting forth such 
                        analysis.
                    (B) Elements.--The report required under 
                subparagraph (A)(ii) shall include the following:
                            (i) An evaluation of commercially available 
                        systems that may satisfy the requirements of 
                        paragraph (2).
                            (ii) The estimated cost of procuring a 
                        commercially available system if a suitable 
                        commercially available system exists.
                            (iii) If no suitable commercially available 
                        system exists, an assessment of the feasibility 
                        of modifying a commercially available system to 
                        meet the requirements of paragraph (2), 
                        including the estimated cost associated with 
                        such modifications.
                            (iv) If no suitable commercially available 
                        system exists and modifying a commercially 
                        available system is not feasible, an assessment 
                        of the estimated cost and time that would be 
                        required to contract with a commercial entity 
                        to design and build an electronic interface 
                        that meets the requirements of paragraph (2).
                            (v) If the Secretary determines that the 
                        Department has the capabilities required to 
                        design and build an electronic interface that 
                        meets the requirements of paragraph (2), an 
                        assessment of the estimated cost and time that 
                        would be required to design and build such 
                        electronic interface.
                            (vi) A description of the decision of the 
                        Secretary regarding how the Department plans to 
                        establish the electronic interface required 
                        under paragraph (2) and the justification of 
                        the Secretary for such decision.
            (4) Limitation on use of amounts.--The Secretary may not 
        spend any amounts to procure or design and build the electronic 
        interface described in paragraph (2) until the date that is 60 
        days after the date on which the Secretary submits the report 
        required under paragraph (3)(A)(iii).
    (c) Clarification of Application of HIPAA Transaction Standards to 
Veterans Choice Program and Other Veterans Health Care Programs Using 
Non-Department Providers; Addressing Multi-Year Backlog in Claims.--
            (1) Application of hipaa administrative simplification 
        standards.--
                    (A) In general.--The definition of the term 
                ``health plan'' under section 1171(5)(J) of the Social 
                Security Act (42 U.S.C. 1320d(5)(J)) is deemed to 
                include the Veterans Choice Program.
                    (B) Implementation.--Not later than 90 days after 
                the date of the enactment of this Act, the Secretary of 
                Veterans Affairs shall make such modifications as may 
                be necessary to implement the amendment made by 
                subparagraph (A) with respect to claims for hospital 
                care or medical treatment furnished under the Veterans 
                Choice Program.
            (2) Addressing backlog of claims by non-department 
        providers.--
                    (A) Adjudication.--Not later than 180 days after 
                the date of the enactment of this section, the 
                Secretary shall adjudicate all claims submitted before 
                such date of enactment by non-Department of Veterans 
                Affairs health care provider under the Veterans Choice 
                Program.
                    (B) Use of payment schedule for non-department 
                health care providers.--Section 1703A(b) of title 38, 
                United States Code, as added by subsection (a)(1), 
                shall apply to claims adjudicated pursuant to 
                subparagraph (A), except that the timeframe involved 
                shall begin on the date of such adjudication.
            (3) Veterans choice program defined.--In this subsection, 
        the term ``Veterans Choice Program'' means hospital care or 
        medical treatment furnished to veterans pursuant to section 101 
        of the Veterans Access, Choice, and Accountability Act of 2014 
        (Public Law 113-146; 38 U.S.C. 1701 note) or any other law 
        administered by the Secretary of Veterans Affairs under which a 
        non-Department of Veterans Affairs health care provider 
        furnishes such care or services.

Summary: This bill directs the Department of Veterans Affairs (VA) to ensure that payments made to non-VA health care providers, including payments under the Veterans Choice Program, comply with the Prompt Payment Act and the requirements set forth in this bill. The bill: (1) prescribes payment schedules; (2) requires, with exceptions, claims to be submitted electroncially beginning January 1, 2019; and (3) requires the VA Chief Information Officer to establish by such date an electronic interface for health care providers to submit reimbursement claims.  The VA shall: (1) within 90 days after enactment of this bill, make necessary modifications to ensure prompt payment for hospital care or medical treatment furnished under the program, and (2) within 180 days after enactment of this bill, adjudicate all program claims submitted before such date by non-VA health care providers.