Review of Patient-Centered Community Care (PC3) Health Record Coordination

We estimate PC3 contractors did not meet the clinical documentation requirements for 68 percent of episodes of care during our period of review from January 1, 2014, through September 30, 2014. We estimate that 48 percent of the clinical documentation was provided to VA late and 20 percent was incomplete. VHA made about $870,400 of improper payments when payments should not have been made prior to receiving complete clinical documentation. VHA did not apply contract penalties to Health Net Federal Services, LLC when it did not meet performance requirements related to the timely return of clinical documentation. VHA applied a penalty of only $753. The maximum allowable penalty was $15,909. If VA exercises the remaining three option years of the PC3 contract without adequately addressing the identified issues, VA could make about $5.5 million in improper payments and missed assessed penalties. We also found that PC3 patients experienced delays in VHA referring and following up on their care with TriWest Healthcare Alliance Corporation (TriWest), as well as TriWest not timely notifying VHA of three malignancy diagnoses resulting from colonoscopies. These issues occurred because VHA relied on contractor-reported data, lacked an adequate program for monitoring contractor performance, and a process to verify whether the contractor meets contract performance standards. As a result, VHA lacked assurance that PC3 is providing patients adequate continuity of care. We recommended VHA implement a mechanism to verify PC3 contractors’ performance without relying on contractors’ self-reported data, VHA ensure PC3 contractors properly annotate and report critical findings in a timely manner, and that VHA imposes financial or other remedies when contractors fail to meet requirements.