VA Spina Bifida Program: Outreach to Key Stakeholders and Written Guidance for Claims Audit Follow-up Activities Needed
Published: 2014-06-23T00:00:00

Fast Facts:

Highlights:
section_title: Why GAO Did This Study
paragraphs: VA provides health care benefits to children diagnosed with spina bifida—a birth defect that can cause physical and neurological issues—born to Vietnam and certain other veterans. Legislation requires the provision of certain health care benefits—including home care, hospital care, outpatient care, and case management—for spina bifida beneficiaries. VHA administers the Spina Bifida Health Care Program for enrolled beneficiaries by processing and paying claims for covered services from private sector providers.
GAO was asked to evaluate VHA's administration of spina bifida health care benefits. In this report, GAO examined for the spina bifida program: (1) the extent to which VHA conducts outreach about available benefits, (2) what is known about health care claims that have been processed, and (3) what, if any, oversight, VHA conducts of the claims process. GAO reviewed the spina bifida program handbook and claims audit reports, analyzed data on submitted, paid, and denied claims from fiscal years 2009 through 2013, and interviewed VHA officials and representatives from key stakeholder organizations.
section_title: What GAO Found
paragraphs: The Department of Veterans Affairs' (VA) Veterans Health Administration (VHA) provides information and updates on covered health care services to beneficiaries enrolled in its spina bifida program, but has conducted limited outreach with key stakeholder organizations. VHA provides information on health care benefits to enrolled beneficiaries through the program website, for example. However, VHA has conducted limited outreach with key stakeholder organizations—such as the Spina Bifida Association—that have relationships with individuals who are potentially eligible for the spina bifida program and its benefits but are not enrolled. Representatives of these organizations told GAO this has contributed to lack of awareness of eligibility and available benefits. Without this outreach, VHA may miss important opportunities to help potentially eligible individuals obtain health care benefits to which they may be entitled.
For the spina bifida program, both total claims payments, as well as the total number of claims paid, increased by more than 40 percent from fiscal year 2009 through fiscal year 2013. VHA officials attributed the increase to a 2008 legislative expansion of health care coverage under the program, and growing health care costs for beneficiaries as they age. During this 5-year period, paid claims represented about 90 percent of all claims submitted each fiscal year.
VHA primarily uses claims audits to oversee its spina bifida claims process. Auditors review a sample of claims and prepare a report with the audit's findings and any necessary follow-up activities. However, VHA does not have written guidance on how staff are to document the status of these follow-up activities to ensure their completion. Without such written guidance, VHA cannot be assured that these activities have been successfully completed or that any recommendations outlined in audit reports have been appropriately implemented.
section_title: What GAO Recommends
paragraphs: GAO recommends that VA conduct outreach with key stakeholder groups regarding the spina bifida program and its benefits, and develop written guidance for completing and documenting the status of follow-up activities related to claims audits. VA concurred with GAO's recommendations.

section_title: Letter
paragraphs: The Department of Veterans Affairs (VA) provides health care benefits, as  well as other benefits, to children diagnosed with spina bifida born to  Vietnam and certain other veterans. Spina bifida is a type of birth defect  that results from the neural tube (the embryonic structure that eventually  develops into the brain and spinal cord) failing to develop or close  properly in utero, which can cause a range of physical and neurological  defects. The majority of individuals with spina bifida live well into  adulthood with proper treatment.
As reported in our prior work, a longitudinal study conducted by the Air  Force found increased incidence of spina bifida in the children of  servicemembers exposed to herbicides, including Agent Orange, in  Vietnam. Subsequently, Congress passed legislation, commonly known  as the Agent Orange Benefits Act, to provide for the special needs of  veterans’ children born with spina bifida that possibly resulted from the  exposure of one or both parents to herbicides during active service in  Vietnam. This legislation authorized VA to provide certain health care  benefits and other benefits (including a monthly monetary allowance)  effective January 1, 1997. Additional legislation expanded these benefits,  and, as of October 10, 2008, health care benefits were no longer limited  to health care services and supplies directly associated with the spina  bifida condition. Accordingly, VA has stated that comprehensive health  care benefits are available to eligible veterans’ children with spina bifida  for services and supplies considered medically necessary and  appropriate for all disabilities and diseases, not simply those related to  spina bifida.
VA’s Veterans Health Administration (VHA) administers the Spina Bifida  Health Care Program (spina bifida program), which provides health care  benefits to enrolled beneficiaries by processing and paying claims for  covered services from private sector providers. VHA is the exclusive  payer for health care services provided to spina bifida beneficiaries;  beneficiaries are not responsible for any copayments or deductibles. As  of October 2013, 1,228 beneficiaries were enrolled for coverage under  the spina bifida program.
You raised questions as to whether eligible beneficiaries are receiving all  the benefits to which they are entitled, and whether all eligible  beneficiaries are aware of available benefits, and asked us to evaluate  how VHA provides health care benefits under the spina bifida program.  This report examines for the spina bifida program (1) the extent to which  VHA conducts outreach about available benefits, (2) how VHA processes  claims, (3) what is known about claims that have been processed, and   (4) what, if any, oversight, VHA conducts of the claims process.
To determine the extent to which VHA conducts outreach about available  spina bifida program benefits, we reviewed VHA documents and  interviewed VHA officials and representatives from stakeholder  organizations. Specifically, we reviewed materials VHA provides to  enrolled beneficiaries, including VHA’s spina bifida program handbook.  We also reviewed documentation and interviewed officials from VHA  about their outreach efforts, including outreach to inform enrolled  beneficiaries and potentially eligible individuals about available health  care benefits. We interviewed representatives from Vietnam Veterans of  America (VVA) and the Spina Bifida Association (SBA)—the two key  stakeholder organizations that have relationships with Vietnam era  veterans and individuals with spina bifida, respectively. We evaluated  VHA’s outreach efforts within the context of federal internal control  standards, as documented in GAO’s Standards for Internal Control in the  Federal Government.
To describe how VHA processes claims for the spina bifida program, we  reviewed VHA documentation, analyzed claims data, and interviewed  VHA officials. Specifically, we reviewed documentation of VHA’s spina  bifida claims process—including VHA’s automated claims processing  system and the business rules that it follows—and the claims  reconsideration and appeals process.
To describe what is known about spina bifida program claims that have  been processed, we analyzed VHA spina bifida claims data, including  data on both paid and denied claims, for fiscal years 2009 through 2013.  We focused the scope of our review on data from these fiscal years to  ensure consistency in our analysis because the scope of covered  services for spina bifida beneficiaries expanded at the beginning of fiscal  year 2009. We further analyzed claims data for outpatient procedures  reimbursed in fiscal year 2013 for spina bifida beneficiaries to identify  examples of the types of services commonly received by beneficiaries,  using the most recent available data. To identify these examples, we  obtained the counts for outpatient procedure codes that were reimbursed  in fiscal year 2013 from VHA, listed by frequency, and we grouped  individual codes by type of service or supply. To identify examples of the  reasons and the types of services for which claims were denied, we  reviewed a sample of 10 denied outpatient claims from fiscal year 2013,  selected for a variety of denial reasons and service types. We also  reviewed documentation associated with this sample of claims—including  the submitted claim, the explanation of benefits, and VHA’s internal  claims processing report for the claim. We interviewed VHA officials about  spina bifida program claims data, including about how the data is  maintained and any limitations to the data, and determined that these  data were sufficiently reliable for our purposes. We also interviewed VHA  officials to obtain their perspective on trends in claims payments and  number of claims for fiscal years 2009 through 2013, as well as  projections for future changes, if any. In addition, we spoke with officials  from SBA and reviewed relevant literature to understand the health care  needs of adults with spina bifida.
To determine what, if any, oversight VHA conducts of the spina bifida  program claims process, we reviewed VHA documentation related to  audits of the claims process and interviewed VHA officials. Specifically,  we reviewed spina bifida claims audit plans and reports for claims paid in  fiscal years 2011, 2012, and 2013, to provide examples of audit findings  from the 3 most recent years available. We also interviewed VHA officials  about the claims audit process, efforts to implement claims audit findings  and recommendations, and other ongoing monitoring activities. We  evaluated VHA’s oversight of the spina bifida program claims process  within the context of federal internal control standards, as documented in  GAO’s Standards for Internal Control in the Federal Government.
We conducted this performance audit from December 2013 to June 2014  in accordance with generally accepted government auditing standards.  Those standards require that we plan and perform the audit to obtain  sufficient, appropriate evidence to provide a reasonable basis for our  findings and conclusions based on our audit objectives. We believe that  the evidence obtained provides a reasonable basis for our findings and  conclusions based on our audit objectives.
subsections: section_title: Background
paragraphs: SBA officials estimate that, nationally, there are more than 160,000  individuals living with spina bifida. The proportion of those individuals who  are children of Vietnam veterans is unknown, due to a lack of data on the  prevalence of spina bifida in this population. As of October 2013, there  were 1,228 beneficiaries enrolled for coverage under the spina bifida  program, ranging from 13 to 50 years of age; the majority of beneficiaries  were adults aged 35 through 45.
subsections: section_title: Spina Bifida Condition and Related Health Care Needs
paragraphs: Spina bifida is a complex congenital disorder that affects multiple body  systems. People with spina bifida experience a variety of health  problems, including difficulty with lower body mobility, lack of bowel and  bladder control, hydrocephalus (a condition in which fluid builds up in the  brain), and learning disabilities. As a result, these individuals require care  from providers in a variety of specialties, such as orthopedics, urology,  neurosurgery, and psychiatry.
Individuals with spina bifida face additional health concerns as they age,  including a higher risk for obesity and obesity-related illnesses,  depression, early osteoporosis, and pressure ulcers. Many of these  health concerns are linked to the diminished mobility that comes with  physical disability. In addition to physical disability, adults with spina bifida  often face difficulty with executive function. Executive function is defined  as a set of mental processes that helps connect past experience with  present action, and is used to perform activities such as planning,  organizing, strategizing, paying attention to and remembering details, and  managing time and space. Difficulty with these mental processes can  inhibit the independence of individuals with spina bifida, and their ability to  manage their own care. Although studies have found that adults with  spina bifida would benefit from access to coordinated care provided in  multidisciplinary clinics because of their complex health needs, the  availability of such care for adults is extremely limited.
section_title: VA’s Spina Bifida Benefits
paragraphs: VA’s Veterans Benefits Administration (VBA) determines eligibility for  spina bifida benefits, including both health care and other benefits. Once  a beneficiary is deemed eligible for benefits, VBA assigns a disability  rating using criteria outlined in regulation, which entitles beneficiaries to  monthly monetary payments similar to those provided to disabled  veterans, as well as vocational rehabilitation and education services  provided through VBA. Regardless of disability rating, beneficiaries are  then automatically enrolled for health care benefits in VHA’s spina bifida  program, which is operated by VHA’s Chief Business Office for  Purchased Care (CBOPC).
VA is required to provide certain health care benefits—including home  care, hospital care, nursing home care, outpatient care, preventive care,  habilitative and rehabilitative care, case management, and respite care— for spina bifida beneficiaries.  Regulations for the spina bifida program  provide additional details on covered services and supplies and outline  preauthorization requirements for certain services. VHA recently sought  to clarify the scope of its authority to provide home care and custodial  care services under the spina bifida program.General Counsel issued an opinion confirming that VHA is required to  provide coverage for these services, as needed, in the beneficiary’s home  or other place of residence (such as a residential group home or assisted-  In June 2013, VA’s  living facility). As of April 2014, VHA was in the process of drafting a  proposed rule incorporating this clarification into regulations.
section_title: VHA Informs Enrolled Beneficiaries about Covered Services, but Has Conducted Limited Outreach with Key Stakeholders
paragraphs: VHA provides information and updates on covered health care services to  enrolled spina bifida beneficiaries. However, VHA has conducted limited  outreach with key stakeholder groups that have a relationship with  potentially eligible individuals who are not already enrolled.
subsections: section_title: VHA Provides Information and Updates to Enrolled Spina Bifida Beneficiaries on Covered Health Care Services
paragraphs: VHA provides information on the available health care benefits to  beneficiaries who are enrolled in its spina bifida program using three  primary methods: (1) the initial mailing of information upon program  enrollment, (2) the program website, and (3) contact with beneficiaries  regarding updates to covered services.
Initial contact by mail. After beneficiaries are enrolled in the  spina bifida program, VHA’s CBOPC staff mail beneficiaries (1) a  program identification card (similar to an insurance card from a   and  private insurer) that providers can use to bill VHA directly,(2) a copy of the program handbook, which contains information  on services covered and services that are generally excluded from  coverage, as well as contact information and the website address  for the program. VHA officials told us they enroll, on average,  about one or two new beneficiaries per month.
Program website. The spina bifida program website includes  links to the program handbook, the policy manual—which provides  additional details on coverage and exclusions for specific  services—and other program documents such as guidance on  how to submit claims. VHA officials told us they consider the  program website to be the primary means of outreach with  beneficiaries.
Phone or mail contact to provide updates on covered  services. VHA has recently shared changes to its spina bifida  program with beneficiaries through telephone calls, and VHA  officials told us they plan to share updates made between  handbook printings through mailings to beneficiaries. Specifically,  beginning in November 2013, VHA’s call center placed phone  calls to enrolled spina bifida beneficiaries to gauge their interest in  obtaining case management services.March 2014, the call center successfully made contact with 579  beneficiaries (47 percent of those enrolled) and 129 of them  expressed interest in obtaining case management services.
According to VHA, as of  In addition to asking about case management services, VHA  officials told us that during these calls, they also provided  clarification that the program covers home care and custodial care  services.  After the program regulations are updated to reflect the  June 2013 opinion from VA’s General Counsel regarding  coverage of these services, the program handbook will be  updated and mailed out to enrolled beneficiaries, according to  VHA officials.
Officials told us that they also plan to follow up with a letter in May 2014 to provide  clarification on the program’s coverage for home care and custodial care services, as well  as case management.
section_title: VHA Has Conducted Limited Outreach with Key Stakeholders regarding Spina Bifida Benefits
paragraphs: VHA has conducted limited outreach with key stakeholder organizations,  and representatives of these organizations told us that this has  contributed to lack of awareness among some individuals who may be  eligible to receive health care benefits under the spina bifida program.  VHA’s outreach with stakeholder organizations has been limited primarily  to providing materials on the program to veteran service organizations for  distribution at conferences. For example, VHA officials told us they  provided materials for conferences held by four different veteran service  organizations in the summer of 2013. However, VHA has not conducted  outreach with VVA and SBA—the two key stakeholder organizations that  we contacted—in recent years. Specifically, representatives from VVA— an organization that represents veterans who served in Vietnam and  advocates on their behalf regarding a variety of issues, including health  care—told us that VHA has not reached out to them regarding its spina  bifida program, and has not provided them any materials regarding  available health care benefits to distribute to their membership. VHA  officials told us that they have met with VVA officials to explain updates to  covered services, but stated that their outreach efforts with stakeholder  organizations are driven by requests from the organizations, and they  were not certain if VVA had requested further outreach. VHA’s most  recent coordination with SBA—an organization with direct contact with  individuals with spina bifida, their families, and the providers who treat  them—was in 2009. VHA officials told us that they coordinated with SBA  that year by staffing a resource education booth at SBA’s annual  conference. VHA officials also told us that limits on travel spending have  prevented them from attending or participating in the conference in recent  years.
Limited outreach with key stakeholder organizations has contributed to  the lack of awareness about available health care benefits among some  individuals who may be eligible to enroll in the spina bifida program,  according to representatives from these organizations. Specifically,  representatives from VVA told us that through VVA’s Agent Orange  Education Campaign they identified new individuals who were potentially  eligible for VHA’s spina bifida program and its benefits, but were not  aware of them.regularly contacted by individuals who have questions about VHA’s spina  bifida program benefits and do not know where to go for more  information. Although SBA includes information on its website about  VHA’s spina bifida program benefits, when we reviewed this page in April  2014, we found that it contained outdated information.
In addition, representatives from SBA told us they are  Federal internal control standards state that agency management should  ensure there are adequate means of communicating with, and obtaining  information from, external stakeholders that may have a significant impact  on the agency achieving its goals.of the spina bifida program is to provide for the special needs of Vietnam  and certain other veterans’ birth children who have been diagnosed with  spina bifida. Key stakeholder organizations are well-positioned to provide  information to these individuals on available benefits because of their  established relationships with veterans and individuals with spina bifida  and their health care providers. However, VHA has not leveraged these  organizations’ relationships with potentially eligible individuals to further  VHA’s goal of providing for the special needs of beneficiaries with spina  bifida.
According to VHA officials, the goal  Representatives from both VVA and SBA stated that they would be willing  to coordinate with VHA on efforts that could improve awareness and  understanding of VHA’s spina bifida program. For example, VVA officials  told us that they could help VHA promote the health care benefits  available through the spina bifida program, including providing information  on the benefits through their weekly emails to subscribers. VVA officials  also suggested that outreach with providers or provider organizations  would be beneficial because it would increase awareness of the  connection between military service and certain health issues, such as  spina bifida, among individuals who are the “first line” in interacting with  patients. Similarly, according to an SBA representative, SBA could  facilitate the connection between VHA and health care providers who  serve individuals with spina bifida. These providers could help identify  spina bifida patients who have a Vietnam-era veteran parent, and provide  those individuals with information about VHA’s health care benefits for  which they may be eligible.
section_title: VHA Uses an Automated System Augmented by Administrative and Clinical Reviews to Process Spina Bifida Claims
paragraphs: VHA uses an automated system, augmented by administrative and  clinical reviews, to process spina bifida claims. The claims process begins  when a provider or beneficiary submits an electronic or paper claim to  VHA. Upon receipt, the claim’s information is to be entered into an  automated claims processing system maintained by VHA’s CBOPC.necessary, staff members conduct administrative or clinical reviews  before denial or payment decisions are made. VHA also has a process for  reconsideration of denied claims.
Automated claims processing. CBOPC’s automated claims  processing system uses business rules to compare the  information in the claim against the spina bifida program’s policies  and regulations for eligibility and covered services. For example,  VHA officials told us the system checks the date of service against  the date the beneficiary was determined to be eligible for the spina  bifida program.
Administrative and clinical review. If the automated system  cannot complete the processing of a claim because it detects an  error or needs additional documentation or approval to continue  with processing, VHA officials told us a CBOPC staff member  conducts an administrative or clinical review. In an administrative  review, a staff member examines a claim to ensure that required  documentation (e.g., required preauthorization for mental health  services) has been received. In a clinical review, the claim is  reviewed by a clinical nurse reviewer to ensure that medical  documentation included is sufficient for processing the claim.example, a clinical nurse reviewer could examine documentation  included with a claim for specialized durable medical equipment to  ensure it is sufficient to support the request, and request  additional documentation if necessary.
Payment or denial. Once the automated system has completed  its checks, and any needed administrative or clinical reviews are  completed, the claim is either routed for payment or it is denied.  For a denied claim, the automated system or reviewer assigns a  denial reason code to the claim, which provides a brief description  of the cause of the denial (e.g., missing documentation or the  service billed was not a covered service). This information is  included in the explanation of benefits document mailed to the  provider and beneficiary.
Resubmission or request for reconsideration. A provider or  beneficiary who disagrees with the amount of payment or the  decision to deny the claim can resubmit the claim for  reprocessing, or submit a request for reconsideration of the claim  to CBOPC within 1 year of the original decision. Resubmission of  claims for reprocessing is separate from the claims  reconsideration process. A resubmitted claim must include the  original explanation of benefits and any other relevant  documentation or corrections for consideration, and resubmitted  claims are sent through the claims processing system as new  claims. VHA officials told us that requests for reconsideration are  processed outside of the automated claims processing system,  and are reviewed by CBOPC staff with consultation from clinical  nurse reviewers as needed. A request for reconsideration that is  subsequently denied can be submitted for a second review within  90 days. Each claim’s explanation of benefits document provides  contact information for CBOPC and the mailing address for  requests for reconsideration.
VHA updates the business rules used by its automated claims processing  system in accordance with changes to the applicable laws and  regulations that govern coverage of specific services. VHA officials told us  that these updates are not made until the rulemaking process is complete  and applicable rules have been published in the Federal Register, a  process that can take years. In the interim, officials said affected claims— such as those for home care services provided in an assisted-living  facility, which VHA recently clarified as covered—would be processed  manually to ensure they are not incorrectly denied by the automated  system.
section_title: Total Spina Bifida Claims Payments and Number of Claims Paid Have Increased from Fiscal Years 2009 through 2013, with Outpatient Services Making Up the Majority of Claims
paragraphs: From fiscal years 2009 through 2013, total payments for spina bifida  claims increased by 43 percent—from about $19.4 million to about   $27.8 million. (See table 1.) The number of beneficiaries who had claims  paid increased by 10 percent, from 803 to 883, and the number of paid  claims increased by 45 percent, from 58,560 to 84,702.
VHA officials told us they attribute the growth in the spina bifida program  to an increasing number of claims and payments in the years following  the 2008 legislative expansion of health care coverage under the  program, as well as increasing health care costs for beneficiaries as they  age and their health care needs become more varied and complex.  Officials told us that, in the future, they expect spending on health care  services to continue to increase due to new services being offered, such  as custodial care. However, they do not expect significant increases in  the number of beneficiaries because there are few new children with  spina bifida born to Vietnam-era veterans and currently proposed  expansions of coverage to new eligibility groups are not likely to add  significantly to program enrollment.
In fiscal years 2009 through 2013, the percentages of paid and denied  claims remained steady, with paid claims representing about 90 percent  of all claims submitted each fiscal year. For example, out of 95,149 claims  submitted in fiscal year 2013, 84,702 (89 percent) were paid. (See  fig. 1.)
About two-thirds of the total number of paid claims in each year from  fiscal years 2009 through 2013 were for outpatient services, the largest of  the six categories tracked by VHA. For example, in fiscal year 2013,   63 percent of the total number of paid claims were for outpatient services.  (See fig. 2.) Outpatient services represented nearly 50 percent of total  payments made that year. In contrast, inpatient claims represented less  than 1 percent of the total number of paid claims in fiscal year 2013, but  31 percent of total claims payments that fiscal year.
In our analysis of VHA’s outpatient procedure code data, we determined  that home care services, physician visits, physical therapy services, and  catheters and other incontinence supplies for spina bifida beneficiaries  were commonly reimbursed outpatient services in fiscal year 2013.  Studies we reviewed and experts we interviewed confirmed that these  services and supplies were consistent with the health care needs of  adults with spina bifida.
Home care services. Although the specific health care needs of  adults with spina bifida can vary widely based on the severity of  their condition, officials from SBA told us that home-based  services are important because of the challenges these individuals  face with executive functioning and limited mobility. Since many  adults with spina bifida rely on wheelchairs and have varying  degrees of mobility, traveling to medical appointments can be  challenging.
Physician visits. Due to the various health problems associated  spina bifida (including musculoskeletal, neurological, and  urological health care needs), medical care for adults with spina  bifida involves visits to numerous physicians—both for primary  and specialty care.
Physical therapy services. A study noted that adults with spina  bifida commonly report chronic pain as a result of the body  mechanics involved in wheelchair propulsion. Another study  noted that physical disability, and the reduced physical activity that  results from it, is a risk factor for early onset osteoporosis in adults  with spina bifida. Physical therapy services can help alleviate  pain and maintain physical functioning for adults with spina  bifida.
Catheters and other incontinence supplies. According to SBA  officials, a common health care issue for individuals with spina  bifida is neurogenic bladder and bowel, in which the nerves in this  area of the body do not function properly, leading to ongoing  issues with incontinence and urinary tract infections, and  potentially renal failure in older populations. Studies we reviewed,  as well as SBA’s spina bifida treatment guidelines, noted the need  for continence management programs for individuals with spina  bifida, including daily intermittent catheterization to improve renal  outcomes.
VHA officials told us that a claim is considered denied if all procedure codes included in  the claim are denied; if some procedure codes are paid and some are denied, the claim is  considered a paid claim. Therefore, the number of denied claims does not reflect all  procedure codes that were denied in a given year. service or hospital discharge), or the need for additional documentation.Specifically, in fiscal year 2013, about 90 percent of denied claims were  denied for administrative reasons. Few claims were denied because the  service was not covered or the beneficiary was ineligible for coverage  (less than 3 percent of all denied claims in fiscal year 2013). For example,  one denied claim we reviewed was for an eye exam—eye exams and  glasses are excluded from coverage per spina bifida program policy.  Another denied claim we reviewed was for durable medical equipment. A  beneficiary requested payment for a device that, via remote control, could  automatically open a door in the home. This claim was denied because  VHA does not provide payment for durable medical equipment that is  used for housing modification.
Few denied claims were submitted for reconsideration. Of the 136  requests for reconsideration in fiscal years 2009 through 2013, 50   (37 percent) were subsequently paid. Specifically, in fiscal year 2013,  there were 35 requests for reconsideration, 15 of which were  subsequently paid.
section_title: VHA Primarily Uses Claims Audits to Oversee Its Spina Bifida Claims Process, but Does Not Have Written Guidance for Audit Follow-up
paragraphs: VHA conducts annual audits of spina bifida program claims, and VHA  officials told us these audits and associated audit follow-up activities are   Auditors from the  the primary means of oversight for the claims process.VHA CBOPC’s Department of Audits & Internal Controls conduct audits of  the spina bifida claims process annually. During the audit, auditors  examine a statistically valid sample of paid claims from the previous  quarter. The purpose of these audits is to identify whether claims were  processed and paid accurately according to spina bifida program policy.
VHA officials told us these audits involve auditors retracing all the steps in  the claims approval and payment process to determine whether all  claims-related decisions were correct. For example, auditors may review  comments from clinical nurse reviewers regarding preauthorization  determinations and re-run automated decision-making associated with  selected claims through a testing program. Any inaccurate processing  identified by the auditors that results in an improper payment (an over- or  under-payment on a claim) is recorded as an error and assigned to a  category, such as duplicate payments, lack of supporting documentation,  or non-compliance with policies and procedures. For example, the fiscal  year 2014 audit (of the fourth quarter of fiscal year 2013 claims) had a  claims processing accuracy rate—the percentage of claims processed  correctly—of 98.4 percent and a proper payment accuracy rate—the  percentage of total payments made correctly—of 99.9 percent.  Specifically, the audit identified three claims with errors—two claims that  should have been denied as duplicates but were not (resulting in  overpayments), and one claim where a data entry error resulted in an  incorrect payment amount.
After the audit is complete, auditors meet with relevant staff to determine  the underlying causes of improper payments and other inaccuracies. An  audit representative also presents the audit’s findings to an audit review  committee, which includes senior CBOPC officials who discuss the root  causes of findings and decide on any necessary follow-up activities.  Auditors then complete a report that documents the audit’s findings,  including corrective actions and recommendations. The audit report’s  corrective actions directly address the errors found in the audit. For  example, VHA collects overpayments or pays providers for  underpayments. Audit report recommendations suggest additional actions  such as training or additional resources that should be made available to  increase processing accuracy moving forward.
There is currently no written guidance on how CBOPC staff are to  document the status of audit follow-up activities—corrective actions and  recommendations outlined in audit reports—to ensure their completion.  VHA officials told us that, beginning with the fiscal year 2014 audit, staff  from CBOPC’s Quality/Corrective Action Program are responsible for  overseeing the status of audit follow-up activities, including working with  relevant staff responsible for implementing any corrective actions.
According to VHA officials, these staff are responsible for determining the  extent of documentation necessary for audit follow-up activities. Officials  also stated that these staff store any documentation in non-networked  files. This can render audit follow-up documentation inaccessible to other  VHA officials who may need it. Further, although staff maintain  information on the status of actions taken to implement audit findings and  the individuals responsible for implementing them, they do not maintain  information on estimated or actual completion dates for audit follow-up  activities. There also is no documentation of interactions with staff or  interim steps taken to ensure that follow-up activities are completed as  planned. For example, officials told us that for one of the identified  actions, there would be monthly follow-ups until the action is complete;  however, there is no documentation to indicate that this interim follow-up  is taking place. According to VHA officials, one reason for the lack of  written guidance on completing and documenting audit follow-up activities  is that their audit follow-up process is new; they anticipate having written  guidance drafted by August 2014.
Federal internal control standards state that internal controls should be  documented and all documentation should be properly managed and   These standards also  maintained, and readily available for examination.state that agencies should have policies and procedures for ensuring that  the findings of audits and other reviews are promptly resolved. VHA’s lack  of written guidance for audit follow-up activities places VHA at increased  risk that these internal control activities may not be performed, may be  performed inconsistently, or may not be continued when knowledgeable  employees leave. This can lead to unreliable monitoring of the spina  bifida claims process, including the inability to ensure that all necessary  audit follow-up activities are completed.
section_title: Conclusions
paragraphs: The legislation that created VA’s spina bifida benefits charged VHA with  serving the needs of a very vulnerable population. Given the lack of data  on the prevalence of spina bifida in the children of veterans, and concerns  from stakeholder organizations that potentially eligible individuals may not  be aware of available benefits under the spina bifida program,  stakeholder organizations are uniquely positioned to assist VHA in  communicating information on spina bifida benefits. By not conducting  outreach with key stakeholders, VHA may be missing important  opportunities to increase awareness among potentially eligible  individuals, and ultimately to help these individuals obtain the benefits to  which they may be entitled.
In addition, without written guidance for audit follow-up activities related to  the spina bifida claims process, VHA cannot be assured that these  activities have been successfully completed or that the corrective actions  and recommendations outlined in audit reports have been appropriately  implemented. The lack of written guidance puts VHA at increased risk  that these activities may be inconsistently performed—or not performed at  all—if there are personnel changes. By developing written guidance for  documenting these activities in a manner consistent with federal internal  control standards, VHA would have greater assurance that audit follow-up  activities are consistently completed, thereby helping to ensure that spina  bifida beneficiaries’ health care claims continue to be accurately  processed.
section_title: Recommendations for Executive Action
paragraphs: To improve awareness of the spina bifida program’s health care benefits  among potentially eligible individuals and to help them obtain the benefits  to which they may be entitled, we recommend that the Acting Secretary of  Veterans Affairs direct the Acting Under Secretary for Health to conduct  outreach with key stakeholder groups regarding the program and its  benefits.
To help ensure continued accurate claims processing, we recommend  that the Acting Secretary of Veterans Affairs direct the Acting Under  Secretary for Health to develop written guidance, consistent with federal  internal control standards, for completing and documenting the status of  follow-up activities for the spina bifida program’s claims audits.
section_title: Agency Comments
paragraphs: We provided a draft of this report to VA for comment. In its written  comments, reproduced in appendix I, VA generally agreed with our  conclusions and concurred with our recommendations. In addition, VA  provided information on its plans for implementing each recommendation,  with an estimated completion date of December 2014.
We are sending copies of this report to appropriate congressional  committees, the Acting Secretary of Veterans Affairs, and other interested  parties. In addition, the report will be available at no charge on the GAO  Web site at http://www.gao.gov.
If you or your staff have any questions about this report, please contact  me at (202) 512-7114 or at draperd@gao.gov. Contact points for our  Offices of Congressional Relations and Public Affairs may be found on  the last page of this report. GAO staff who made key contributions to this  report are listed in appendix II.
section_title: Appendix I: Comments from the Department of Veterans Affairs
section_title: Appendix II: GAO Contact and Staff Acknowledgments
subsections: section_title: GAO Contact
section_title: Staff Acknowledgments
paragraphs: In addition to the contact named above, Janina Austin, Assistant Director;  Jennie F. Apter; George Bogart; Vikki L. Porter; Julie T. Stewart; and  Malissa G. Winograd made key contributions to this report.