Audit of VHA's Consolidated Patient Account Center Controls To Prevent Improper Billings for Service-Connected Conditions

Report Information

Issue Date
Report Number
16-00589-264
VA Office
Veterans Health Administration (VHA)
Information and Technology (OIT)
Report Author
Office of Audits and Evaluations
Report Type
Audit
Recommendations
6
Questioned Costs
$0
Better Use of Funds
$0
Congressionally Mandated
No

Summary

Summary
In March 2015, OIG received an allegation that Veterans Health Administration Consolidated Patient Account Centers (CPAC) inappropriately billed veterans and third-party payers for treatment of service-connected (SC) conditions and used an automated system designed to bill by default. We determined whether CPAC controls ensured veterans and third-party payers were not billed for treatment of SC conditions. We substantiated the allegation that CPACs improperly billed veterans and third-party payers and used an automated system that billed by default. Of about 15.4 million bills VHA issued during FY 2015, we estimated approximately 1.7 million (11 percent) were improper bills for treatment of SC conditions. Of the 1.7 million bills, approximately 623,000 were sent to veterans and approximately 1.0 million were sent to third-party payers. This occurred because CPACs did not provide billing staff access to Veterans Benefits Management System, establish procedures to review prescriptions, conduct comprehensive quality assurance reviews of SC determinations, and provide consistent training to VA medical facility staff. We estimated that VHA improperly issued bills totaling about $15 million to veterans and approximately $295.6 million to third-party payers for treatment of SC conditions. We also estimated VHA inappropriately collected approximately $13.9 million from veterans and at least $13 million from third party payers for the improper bills. We recommended the Under Secretary for Health statistically sample bills of SC veterans and assess other means to identify and refund erroneous bills. We also recommended the Under Secretary ensure CPAC billing staff receive read only access to VBMS, review prescriptions for service connection, revise quality assurance reviews, and monitor changes and provide training for medical providers. The Under Secretary for Health concurred, or concurred in principle, with our recommendations and provided action plans. We considered the plans acceptable and will follow up on their implementation.

Open Recommendation Image, SquareOpenClosed and Implemented Recommendation Image, CheckmarkClosed-ImplementedNot Implemented Recommendation Image, X character'Closed-Not Implemented
No. 1
Closed and Implemented Recommendation Image, Checkmark
to Veterans Health Administration (VHA)
We recommended the Under Secretary for Health require Consolidated Patient Account Centers review a statistical sample of bills issued during fiscal years 2015 and 2016 for the treatment of service-connected veterans to identify erroneously billed amounts that require refunds, and use these results to address internal control deficiencies and assess what additional efforts can be taken to identify and refund erroneously billed amounts.
No. 2
Closed and Implemented Recommendation Image, Checkmark
to Veterans Health Administration (VHA)
We recommended the Under Secretary for Health require Consolidated Patient Account Center management to provide billing staff read-only access to the Veterans Benefits Management System to identify potential service-connected bills that require review by Revenue Utilization Review nurses.
No. 3
Closed and Implemented Recommendation Image, Checkmark
to Veterans Health Administration (VHA)
We recommended the Under Secretary for Health require Consolidated Patient Account Center management establish oversight procedures to review statistical samples of prescriptions prior to generating bills to veterans and to address any identified systemic or facility-specific billing problems.
No. 4
Closed and Implemented Recommendation Image, Checkmark
to Veterans Health Administration (VHA)
We recommended the Under Secretary for Health require Consolidated Patient Account Center management to revise quality assurance reviews to include reviews of pharmacy bills and evaluate whether Revenue Utilization Review nurses correctly validate or make service-connection determinations for veterans’ medical treatment based upon staffing and workload.
No. 5
Closed and Implemented Recommendation Image, Checkmark
to Veterans Health Administration (VHA)
We recommended the Under Secretary for Health require Consolidated Patient Account Center management to revise policy and procedure to require Consolidated Patient Account Center staff to adequately provide and document training for VA medical facility staff regarding specific service-connection determination errors.
No. 6
Closed and Implemented Recommendation Image, Checkmark
to Veterans Health Administration (VHA)
We recommended the Under Secretary for Health require Consolidated Patient Account Center management to track and monitor incorrect medical provider service-connection determinations and coordinate training to ensure identified issues are appropriately addressed.