May 11, 2015
Implementation of the Veterans Choice Program (VCP)
Once a veteran meets one of the above requirements
In response to concerns about access to medical care at
VACAA allows the VA to authorize care for veterans
many Department of Veterans Affairs (VA) hospitals and
outside the VA health care system if any of the following
clinics across the country, Congress passed the Veterans
requirements are met:
Access, Choice and Accountability Act of 2014 (VACAA).
On August 7, 2014, President Obama signed the bill into
• The VA cannot schedule a medical appointment within
law (P.L. 113-146 as amended by P.L. 113-175 and P.L.
30 days of the veteran’s preferred date, or the date
113-235). For a detailed provision-by-provision explanation
determined medically necessary. This means that the
of the Act see, CRS Report R43704, Veterans Access,
VA is unable to identify a particular date, time, location,
Choice, and Accountability Act of 2014 (H.R. 3230; P.L.
and entity or health care provider within 30 days of the
113-146).
date that the appointment was deemed clinically
necessary by a VA health care provider, or, if no such
Section 101 of VACAA authorized the Veterans Choice
clinical determination has been made, the date that a
Program (VCP) ―a new, temporary program that provides
veteran prefers to be seen by a health care provider
veterans the ability to receive medical care in the
capable of furnishing the hospital care or medical
community. The temporary program will end when the $10
services required by the veteran; or
billion in mandatory funding are used, or no later than
• The veteran resides more than 40 miles from his or her
August 7, 2017. This new program is in addition to several
closest VA medical facility (On April 24, 2015, the VA
already existing statutory authorities that allow the VA to
announced that it will determine distance between a
provide care outside of its own health care system (38
veteran’s place of residence and the nearest VA medical
U.S.C.§§ 1703, 1703note, 1725, 1728, 8111, and 8153).
facility using driving distance rather than straight-line
Generally, these statutory authorities fall into three broad
distance or geodesic distance to such a facility.); or
categories: 1) contracts to purchase care, 2) non-contracted
medical care purchased on a fee for service basis from
• The veteran resides 40 miles or less from a VA medical
providers in the community, and 3) emergency care when
facility and faces an unusual or excessive burden in
delays may be hazardous to a veteran’s life or health.
accessing such a facility due to geographical challenges;
Furthermore, in September 2013, the VA had awarded
or
contracts to two private companies (Health Net Federal
• The veteran resides in a state without a full-service VA
Services, LLC, and TriWest Healthcare Alliance
medical facility that provides hospital care, emergency
Corporation) to implement the Patient Centered Community
services and surgical care and resides more than 20
Care (PC3) program―a care coordination and referral
miles from such a facility (this criterion only applies to
program to provide eligible veterans access to care when
veterans residing in three states: Alaska, Hawaii, and
VA cannot provide health services either at a VA medical
New Hampshire).
facility or through other federal agencies or sharing
agreements. In FY2014, the VA spent approximately $7
VCP Implementation
billion (excluding VCP) to purchase care from the
community, and authorized almost 14 million outpatient
The VACAA provided 90 days from the date of enactment
visits, among other services and procedures (excluding
to establish the temporary VCP. On September 17, 2014,
VCP).
the VA held an “Industry Day” to seek input from parties
VCP Eligibility
interested in providing Third Party Administrator (TPA)
support to the VA. TPA functions included creating and
distributing the Veteran's Choice Card, establishing a call
Section 101 of VACAA established specific eligibility
center to provide education to veterans and providers on
criteria for the new VCP. Generally, to participate in the
VCP details, responding to veteran and clinician inquiries,
VCP a veteran must meet one of the following two broad
tracking, monitoring and reporting on veteran utilizations,
sets of criteria:
and managing claims adjudication and payment to include
• The veteran must be enrolled in the VA health care
receipt of clinical documentation. The TPA was also
system as of August 1, 2014, including a veteran
required to facilitate and manage patient referrals, and
enrolled in the VA health care system who has not
establish a utilization review department to make Non-
received hospital care or medical services from the VA
Service Connected/Service Connected/Special Authority
and has contacted the VA seeking an initial appointment
(NSC/SC/SA) determinations. Since there was feedback
for the receipt of such care or services; or
from the private industry about significant challenges of
•
meeting VACAA’s limited implementation timeline, VA
Must be a combat-theater veteran discharged or released
awarded Health Net Federal Services, LLC, and TriWest
from active duty during a five-year period prior to
Healthcare Alliance Corporation―the same contractors that
enrollment.
www.crs.gov | 7-5700

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Implementation of the Veterans Choice Program (VCP)
administer the PC3 program―TPA responsibilities by
Figure 2. High Level Flow Chart for VCP
modifying the existing PC3 contract. Figure 1 shows the
VCP TPA regions.
Figure 1. Veterans Choice Contract Coverage Map
(Same as PC3 Regions)

Source: Congressional Research Service based on VA information.
Notes: TPA= Third Party Administrator; VCP=Veterans Choice
Program.
Some Potential Issues for Congress
Source: Department of Veterans Affairs
• Overlapping and sometimes contradictory eligibility
How is the VCP Administered?
requirements among the various non-VA care statutory
authorities. VA’s statutory authorities (38 U.S.C. §§
Those veterans who qualify under the 40-mile criteria will
1703, 1725, 1728, 8111, and 8153) to obtain the services
generally call the TPA for information or express interest in
of non-VA providers in non-VA facilities were
receiving care outside the VA health care system (see
developed at various times in an incremental and
Figure 2). The TPA generally will have received a list of
uncoordinated manner to respond to specific
eligible participants from the VA. When an appointment is
requirements. Sometimes pilot programs have evolved
scheduled for a veteran who qualifies under the 40-mile
into permanent programs. For example, Project HERO
criteria, TPA is required to notify the VA medical center
evolved into PC3 (see CRS Report R41065, Veterans
(VAMC). Following the veteran’s appointment with a non-
Health Care: Project HERO Implementation). These
VA provider, the TPA is required to gather clinical
overlapping and sometimes contradictory programs have
documentation, claim information and Explanation of
led to confusion among veterans, and even VA’s own
Benefit (EOB) information from the provider, and submit it
employees who administer these programs.
to the VA. The VAMC staff is supposed to retrieve
• Multiple reimbursement methodologies. VA bases fee-
documentation from the TPA’s web portal and upload the
for-service or contract care reimbursement rates to
information into the veteran’s clinical record. The VA’s
providers on the applicable Medicare or VA Fee
Chief Business Office (CBO) Purchased Care (CBOPC)
Schedule rates. However, programs like PC3 reimburse
staff is required to then process claim payment to the TPA,
the providers at rates that are generally lower than the
and the TPA will make the payment to the non-VA
Medicare rates VA typically pays for non-VA care.
provider.
Nevertheless, VCP requires reimbursement at least at
the Medicare rate.
For those veterans who qualify because they may have to
•
wait more than 30 days for care, authorizations are made
Lack of Medicare rates for some services. Currently, the
based on the Veterans Choice List or Electronic Wait List.
VA obtains certain services in the community such as
The VAMC makes the veteran aware of eligibility to
dental care, and VCP requires reimbursement at least at
participate in the VCP. Generally, for those veterans who
the Medicare rate. Medicare generally does not cover
have to wait more than 30 days for care the VAMC submits
dental care.
clinical documentation to the TPA. The veteran will call the
• Lack of provider agreement authority. Currently, VA
TPA for information or express interest in receiving care
lacks provider agreement (a noncontractual mechanism)
from a non-VA provider. If the veteran elects to receive
authority, which is simpler and less burdensome than
care under the VCP, the TPA will then schedule an
VA contracting procedures. Such an authority may
appointment, and notify the VAMC of the scheduled
appeal to smaller or solo non-VA healthcare providers.
appointment. After the scheduled appointment with the
non-VA provider, the TPA will follow the same process as
Sidath Viranga Panangala, spanangala@crs.loc.gov, 7-
described for those who qualify for the 40-mile criteria.
0623

IF10224
www.crs.gov | 7-5700

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