[Federal Register Volume 64, Number 193 (Wednesday, October 6, 1999)]
[Rules and Regulations]
[Pages 54207-54218]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-25871]


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DEPARTMENT OF VETERANS AFFAIRS

38 CFR Part 17

RIN 2900-AJI8


Enrollment--Provision of Hospital and Outpatient Care to Veterans

AGENCY: Department of Veterans Affairs.

ACTION: Final rule.

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SUMMARY: This document amends VA's medical regulations. The Veterans' 
Health Care Eligibility Reform Act of 1996 mandates that VA implement a 
national enrollment system to manage the delivery of healthcare 
services. Accordingly, the medical regulations are amended to establish 
provisions consistent with this mandate. Starting October 1, 1998, most 
veterans were required to be enrolled in the VA healthcare system as a 
condition of receiving VA hospital and outpatient care. Veterans will 
be allowed to apply to be enrolled at any time. They will be eligible 
to be enrolled based on funding availability and their priority status. 
In accordance with statutory provisions, the final rule also states 
that some categories of veterans are eligible for VA hospital and 
outpatient care even if not enrolled. This document further establishes 
a ``medical benefits package'' setting forth, with certain exceptions, 
the hospital and outpatient care that will be provided to enrolled 
veterans and certain other veterans.
    Moreover, this document announces that VA will enroll all 7 
priority categories of veterans for the period October 1, 1999 through 
September 30, 2000, unless it is necessary to change this determination 
by a subsequent rulemaking document.

DATES: Effective Date: November 5, 1999.

FOR FURTHER INFORMATION CONTACT: Roscoe Butler, Health Administration 
Service, (10C3), Veterans Health Administration, Department of Veterans 
Affairs, 810 Vermont Avenue, NW, Washington, DC 20420, (202) 273-8302. 
(This is not a toll-free number.)

SUPPLEMENTARY INFORMATION: In a document published in the Federal 
Register on July 10, 1998 (63 FR 37299), we proposed to amend the 
medical regulations at 38 CFR part 17. Public Law 104-262, the 
Veterans' Health Care Eligibility Reform Act of 1996, mandates that VA 
implement a national enrollment system to manage the delivery of 
healthcare services. Public Law 104-262 also contains priority 
categories for determining eligibility for enrollment. Accordingly, we 
proposed

[[Page 54208]]

to amend the medical regulations to establish provisions consistent 
with these statutory provisions. Starting October 1, 1998, most 
veterans were required to be enrolled in the VA healthcare system as a 
condition for receiving VA hospital and outpatient care. The proposal 
also stated that these veterans would be allowed to apply to be 
enrolled at any time. In accordance with statutory provisions, the 
proposal further stated that some categories of veterans would be 
eligible for VA hospital and outpatient care even if not enrolled. In 
addition, we proposed to establish a ``medical benefits package'' 
setting forth, with certain exceptions, the hospital and outpatient 
care that would be provided to enrolled veterans and certain other 
veterans.
    We received comments from 10 sources. The comments are discussed 
below. Based on the rationale set forth in the proposed rule and in 
this document, the provisions of the proposed rule are adopted as a 
final rule with certain changes explained below.

Catastrophically Disabled

    The priority listing for enrollment in proposed Sec. 17.36 provided 
for certain catastrophically disabled veterans to be enrolled in 
priority category 4 and for certain other catastrophically disabled 
veterans to be enrolled in priority category 7. The proposed provisions 
were based on an attempt to reconcile the provisions of 38 U.S.C. 1705 
and 1710(a). The provisions of 38 U.S.C. 1705 include in priority 
category 4 ``veterans who are catastrophically disabled.'' The 
provisions of 38 U.S.C. 1710(a) set forth a preference scheme for 
providing VA care first to ``mandatory veterans'' and then to 
``discretionary veterans.'' This preference scheme, if controlling, 
would place some catastrophically disabled veterans in a lower priority 
category than priority category 4. Several commenters asserted that the 
provisions of 38 U.S.C. 1705 must be interpreted to require that all 
catastrophically disabled veterans be enrolled in priority category 4. 
Upon further consideration, we have concluded that the statutory 
provisions in question are irreconcilable and that the rules of 
statutory construction require that deference be given to the more 
specific provisions in 38 U.S.C. 1705. Accordingly, except as discussed 
below, the final rule includes all catastrophically disabled veterans 
in priority category 4.
    Some veterans who are catastrophically disabled must agree to make 
the applicable co-payment as a condition of being included in priority 
category 4. This is because 38 U.S.C. 1710 imposes co-payments on 
certain veterans, including some veterans who are catastrophically 
disabled. Accordingly, we amended Sec. 17.36(b)(4) to reflect the co-
payment requirement. We also made corresponding changes to 
Sec. 17.36(d)(1) with respect to information to be included in the 
application for enrollment in the VA healthcare system.
    In Sec. 17.36(e), the definition of the term ``catastrophically 
disabled'' includes the requirement that the condition be 
``permanent.'' Some commenters opposed the inclusion of this 
requirement. Although we have retained the requirement that the 
condition be ``permanent,'' we have made clarifying changes.
    We believe that a condition causing an individual to be 
catastrophically disabled must be a ``permanent'' condition. Under the 
provisions of 38 U.S.C. 1705, priority category 4 consists of 
``Veterans who are in receipt of increased pension based on a need of 
regular aid and attendance or by reason of being permanently housebound 
and other veterans who are catastrophically disabled.'' The words 
``other veterans who are catastrophically disabled'' indicate that all 
veterans in priority category 4 are ``catastrophically disabled'' and 
are disabled to a similar extent. To be in receipt of increased pension 
based on a need of regular aid and attendance or by reason of being 
permanently housebound, a veteran must be permanently disabled (see 38 
U.S.C. 1502 and 1521). We have thus construed this statutory priority 
category to include only veterans with permanent conditions. Our 
interpretation is consistent with other provisions of Pub. L. 104-262, 
which, as noted above, includes the mandate that VA implement a 
national enrollment system. In this regard, the four examples used to 
describe the term ``disabled'' in 38 U.S.C. 1706 are permanent 
conditions, i.e., spinal cord dysfunction, blindness, amputations, and 
serious mental illness. Moreover, the legislative history of Pub. L. 
104-262 refers to a permanent condition, spinal cord injury, to 
describe the type of disabilities intended to be covered by the term 
``catastrophically disabled'' (House Report No. 690, 104th Cong., 2d 
Sess. 7 (1996)) and the Joint Explanatory Statement for H.R. 3118, The 
Proposed Veterans' Health Care Eligibility Reform Act of 1996 (142 
Cong. Rec. S11642, S11646 (daily ed. Sept. 28, 1996)).
    We have, however, clarified the criteria for determining when a 
condition is permanent. In this regard, we have revised the second 
sentence in Sec. 17.36(e) to read as follows: ``This definition is met 
if an individual has been found by the Chief of Staff (or equivalent 
clinical official) at the VA facility where the individual was examined 
to have a permanent condition specified in paragraph (e)(1) of this 
section; to meet permanently one of the conditions specified in 
paragraph (e)(2) of this section by a clinical evaluation of the 
patient's medical records that documents that the patient previously 
met the permanent criteria and continues to meet such criteria 
(permanently) or would continue to meet such criteria (permanently) 
without the continuation of on-going treatment; or to meet permanently 
one of the conditions specified in paragraph (e)(2) of this section by 
a current medical examination that documents that the patient meets the 
permanent criteria and will continue to meet such criteria 
(permanently) or would continue to meet such criteria (permanently) 
without the continuation of on-going treatment.'' This clarifies that a 
veteran who previously met the criteria in Sec. 17.36(e)(2) for 
establishing a permanent condition would continue to meet the criteria 
even if the condition has improved because of ongoing treatment. In our 
view, on-going treatment does not change the finding that the condition 
is permanent.
    In Sec. 17.36, paragraph (e) defines the term ``catastrophically 
disabled'' and includes provisions stating that the definition is met 
if certain conditions are met. One commenter argued that in order to be 
determined to be ``catastrophically disabled'' a veteran should be 
required to meet the definition or the conditions, but not both. No 
changes are made based on this comment. Both the definition and the 
specific conditions or the functional disability levels that meet the 
definition are necessary to ensure that the term ``catastrophically 
disabled'' is uniformly applied.
    Under the provisions of Sec. 17.36(b)(4), a veteran may be 
determined to be catastrophically disabled and thereby included in 
priority category 4 only if determined to be catastrophically disabled 
by the Chief of Staff (or equivalent clinical official) at the VA 
facility where the veteran was examined. One commenter suggested that 
VA include in the regulations additional information concerning 
examinations for determining whether veterans are catastrophically 
disabled, i.e., how a first-time applicant could obtain 
catastrophically disabled status, how the examination would be 
conducted, and whether records of previous treatment and examination 
could be substituted for a current examination. No changes are made

[[Page 54209]]

based on this comment. We will consider a subsequent amendment to this 
final rule to include additional procedures as warranted. Currently, 
examinations could be provided based on the request of a veteran or VA. 
Also, the Chief of Staff (or equivalent clinical official) at the VA 
facility where the individual was examined would make decisions based 
on the criteria in the final rule for determining whether a veteran is 
catastrophically disabled and could use any available records in making 
the decision. Further, the decisionmaker could make a decision without 
requiring a new examination if the records are sufficient.
    One commenter asserted that the determination by the Chief of Staff 
(or equivalent clinical official) constitutes an appeal and that the 
final rule should include appeal procedures and time limits for this 
decision. No changes are made based on this comment. The decision by 
the Chief of Staff (or equivalent clinical official) constitutes the 
initial decision. It is that decision that could be appealed.
    In the proposal, the conditions for determining whether a veteran 
is catastrophically disabled included a finding that the veteran is 
``[d]ependent in 4 or more Activities of Daily Living (eating, 
dressing, bathing, toileting, transferring, incontinence of bowel and/
or bladder), with at least 4 of the dependencies being permanent, using 
the Katz scale.'' Commenters argued that the reference to 4 should be 
lowered in both places to 3. We have compared the conditions with the 
definition of catastrophically disabled and have concluded that the 
definition would still be met if the number were changed to 3 in both 
places. Accordingly, we have made these changes in the final rule.
    In the proposal, the conditions for determining whether a veteran 
is catastrophically disabled include a finding that the veteran scored 
30 or lower using the Global Assessment of Functioning. Commenters 
asserted that the score for the Global Assessment of Functioning should 
be raised to 40. No changes are made based on these comments. Patients 
above 30 are in a range described as severe but less than catastrophic 
in that they do not require personal or mechanical assistance to leave 
home or bed or require constant supervision to avoid physical harm to 
self or others. Accordingly, they would not meet the definition of 
catastrophically disabled.
    Commenters recommended that the list of conditions in Sec. 17.36(e) 
that would establish that a veteran is ``catastrophically disabled'' 
should be expanded to include chronic and severe mental illnesses, 
Amyotrophic Lateral Sclerosis, Multiple Sclerosis, a score of 5 or 
higher on the Kurtzke Expanded Disability Status Scale for Multiple 
Sclerosis, and possibly other things. No changes are made based on 
these comments. Conditions not specifically mentioned, including those 
mentioned by the commenters, would be covered when the criteria in 
Sec. 17.36(e) are met. It is impractical to attempt to list all of the 
specific conditions that would be covered by the criteria.
    The list of conditions for establishing that a veteran is 
catastrophically disabled includes a condition resulting from two of 
the specified procedures in Sec. 17.36(e)(1) provided the two 
procedures were not on the same limb. The proposed procedures included 
``Amputation of toe (only if accompanied by V49.71 code for amputated 
great toe) (procedure code 84.11).'' These provisions are clarified to 
reflect more clearly that the toe amputated must be the great toe.
    The proposed list of conditions for establishing that a veteran is 
catastrophically disabled included permanent ``unspecified 
hemiplegia.'' This is deleted. The final rule provides that a veteran 
is catastrophically disabled upon a finding of a score of 2 or lower on 
at least 4 of the 13 motor items using the Functional Independence 
Measure. This finding necessarily could be made if a veteran had 
hemiplegia that would be catastrophically disabling. This Functional 
Independence Measure is a more appropriate method of determining 
whether hemiplegia constitutes a catastrophic disability.
    The proposed list of conditions for establishing that a veteran is 
catastrophically disabled included a score of 14 or higher on the 
Activities of Daily Living (ADL) Index using Resource Utilizations 
Group (RUG) III. This condition is deleted. The ADL section is one part 
of a complex multidimensional assessment tool known as the Minimum Data 
Set (MDS). All sections in the MDS contribute to the construction of 44 
RUGs (RUG III). Therefore isolating one section and attempting to 
calculate a numerical score invalidates the purpose for which the 
instrument was designed.
    Moreover, this should not have any negative effects on veterans. 
The category of veterans intended to meet the definition of 
catastrophically disabled based on the ADL criteria necessarily would 
also meet the definition of catastrophically disabled based on the 
criteria in Secs. 17.36(e)(2)(i) or (iii) i.e., dependent in 3 or more 
Activities of Daily Living (eating, dressing, bathing, toileting, 
transferring, incontinence of bowel and/or bladder), with at least 3 of 
the dependencies being permanent, using the Katz scale; or a score of 2 
or lower on at least 4 of the 13 motor items using the Functional 
Independence Measure. In the ADL provision, ``dependent'' was intended 
to mean fully dependent. Being fully dependent is represented by a 
rating of 1 on the Katz scale. We have clarified the rule accordingly.
    One commenter questioned how the definition and conditions were 
established for determining when an individual is ``catastrophically 
disabled''. In this regard, we note that the definition and conditions 
were formulated by knowledgeable VA clinical experts.
    One commenter asserted that VA form 10-10 EZ should be amended to 
specifically ask whether a veteran is requesting an examination to 
determine whether the veteran is catastrophically disabled. No changes 
are made based on this comment. The issue of whether an individual 
should be examined is a complex matter (see Sec. 17.36(e)) that does 
not lend itself readily to the form. Further, before a veteran would be 
removed from the list of enrollees based on a priority status lower 
than priority category 4, the veteran first would be provided a letter 
advising of the opportunity to request that action be taken (including 
an examination, if needed) to determine whether the veteran is 
catastrophically disabled and thereby eligible for inclusion in 
priority category 4.

Additional Enrollment Issues

    One commenter opposed any enrollment system that could exclude any 
categories of veterans from access to medical care. No changes are made 
based on this comment. The Veterans' Health Care Eligibility Reform Act 
requires that we establish a system for the management of hospital and 
outpatient care based on priorities and available funding.
    One commenter asserted that nonservice-connected Purple Heart 
recipients should be included in priority category 3. No changes are 
made based on this comment. The priority categories are established by 
statute, and there is no authority to include this category of veterans 
in priority category 3.
    One commenter asserted that within priority category 7, military 
retirees should be given a subpriority based on the further assertion 
that military retirement benefits are inadequate. No changes are made 
based on this

[[Page 54210]]

comment. This final rule is not an appropriate forum for addressing 
military retirement benefits.
    One commenter asserted that enrollment status decisions should be 
transferable among VA medical facilities. In response, we have added a 
note to Sec. 17.36 to clarify that a veteran's enrollment status will 
be honored by all VA medical facilities in the United States (care 
abroad is covered by 38 U.S.C. 1724).
    One commenter asserted that veterans should be given a presumption 
of entitlement to medical services when they initially apply or reapply 
for enrollment and should receive medical services until an appeal is 
decided. No changes are made based on this comment. We have no 
authority to include such provisions in the final rule.
    One commenter asserted that enrollment should guarantee a veteran 
access to the ``medical benefits package'' for a certain period of 
time, e.g. until the end of the fiscal year. Commenters also asserted 
that after a number of years of receiving VA medical services an 
enrollee's right to receive medical services should become permanent. 
No changes are made based on these comments. It is our intent under the 
provisions of Sec. 17.36 to try to predict accurately for the whole 
fiscal year how many priority categories will be funded. However, the 
regulations must include provisions for amending the determination at 
any time because VA can only provide services insofar as there are 
available funds to cover the services. Further, we have no authority to 
make permanent an enrollee's right to receive medical services.
    Under the provisions of Sec. 17.36(d)(4)(iii), a veteran who had 
been enrolled based on inclusion in priority category 5 will be 
disenrolled if the veteran does not return to VA a completed form VA 
Form 10-10EZ. One commenter asserted that this provision could cause 
some of the most vulnerable veterans to lose their medical benefits. No 
changes are made based on this comment. This will not disadvantage 
veterans who are disenrolled merely because they did not return the 
form. Under the provisions of Sec. 17.36 such a veteran may reapply to 
be enrolled at any time and thereby supply the information necessary to 
determine their enrollment priority category.
    One commenter opposed the provisions in Sec. 17.36(d)(4)(i) which 
state that a veteran will be removed from the list of enrollees if the 
veteran submits to a VA medical center a signed document stating that 
the veteran no longer wishes to be enrolled. No changes are made based 
on this comment. If a veteran no longer intends to obtain VA care we 
would like to be informed so that we can better predict the demand for 
VA care. However, this will not disadvantage those who wish to restore 
their enrollment status since, as noted above, a veteran may reapply to 
be enrolled at any time.
    Commenters asserted that the letter that VA sends veterans 
concerning their enrollment status should indicate which priority group 
the veteran was placed in and all co-payment information. We intend to 
provide this information to enrolled veterans as soon as possible.
    Under the provisions of Pub. L. 105-368, a veteran enrolled based 
on an illness associated with service in combat in a war after the Gulf 
War or during a period of hostility after November 11, 1998, is 
included in priority category 6 and is eligible for VA hospital and 
outpatient care provided in the medical benefits package for the 
illness. The final rule is amended to reflect this statutory change.

Hospital and Outpatient Care to Veterans Who are not Enrolled in 
the VA Healthcare System

    Consistent with the provisions of Pub. L. 104-262, Sec. 17.37 
specifies when VA may provide hospital and outpatient care to veterans 
who are not enrolled in the VA healthcare system. One commenter 
asserted that this should include a statement that a veteran who is not 
enrolled in the VA healthcare system may receive an examination to 
determine whether the veteran is eligible for inclusion in priority 
category 4 based on a finding that the veteran is catastrophically 
disabled. We agree and have amended Sec. 17.37 accordingly.

Medical Benefits Package

    One commenter argued that the final rule should concern only a 
national enrollment system and, accordingly, should not include a 
medical benefits package. Although the commenter concluded that VA has 
inherent authority to establish a medical benefits package, the 
commenter asserted that the proposed rule purportedly was designed 
solely ``to implement the Veterans' Health Care Eligibility Reform Act 
of 1996'' and that the ``medical benefits package'' went beyond this 
statutory authority. The commenter also asserted that the statutory 
provisions at 38 U.S.C. 1701 and the regulations at 38 CFR 17.30 are 
adequate for determining what care will be provided to enrolled 
veterans. The commenter further asserted that we did not provide 
sufficient rationale or justification for the establishment of a 
``medical benefits package.'' No changes are made based on these 
comments. Although the Veterans' Health Care Eligibility Reform Act of 
1996 did not direct VA to create a medical benefits package, we believe 
that it is necessary under the requirements of the Administrative 
Procedure Act to inform affected individuals concerning the care that 
would or would not be provided to veterans enrolled in the VA 
healthcare system. The definitions of terms in 38 U.S.C. 1701 and 38 
CFR 17.30 are not adequate by themselves to allow individuals to make 
such determinations. Further, the following statement in the preamble 
portion of the proposed rule provided the rational basis for the 
medical benefits package: ``The Secretary has authority to provide 
healthcare as determined to be medically needed. In our view, medically 
needed constitutes care that is determined by appropriate healthcare 
professionals to be needed to promote, preserve, or restore the health 
of the individual and to be in accord with generally accepted standards 
of medical practice. The care included in the proposed `medical 
benefits package' is intended to meet these criteria.''
    Commenters asserted that infertility services, pregnancy and 
delivery, surgical implantation of penile prostheses, and membership in 
spas and health clubs should be included in the medical benefits 
package. As noted above, the medical benefits package would include 
``care that is determined by appropriate healthcare professionals to be 
needed to promote, preserve, or restore the health of the individual 
and to be in accord with generally accepted standards of medical 
practice.'' Upon reconsideration, we conclude that pregnancy and 
delivery services (to the extent we have legal authority to provide 
such services) meet these criteria and should be included in the 
medical benefits package. We also conclude that membership in spas and 
health clubs does not meet these criteria and should not be included. 
Further, under these criteria, we have determined that reproductive 
sterilization, surgery to reverse voluntary sterilization, infertility 
services (other than in vitro fertilization), and surgical implantation 
of penile prostheses should not be excluded. Appropriate changes are 
made to the medical benefits package to reflect these determinations.
    Commenters asserted that the ``medical benefits package'' should 
cover all emergency care for all enrolled veterans. No changes are made 
based on these comments. The final rule includes in the ``medical 
benefits package'' all of

[[Page 54211]]

the emergency care that VA is authorized to provide to enrolled 
veterans (see 38 U.S.C. 1703, 1728).
    Priority category 6 includes veterans solely seeking care for a 
disorder associated with exposure to a toxic substance or radiation or 
for a disorder associated with service in the Southwest Asia theater of 
operations during the Gulf War, as provided in 38 U.S.C. 1710(e). One 
commenter asserted that these veterans should be eligible to receive 
the full ``medical benefits package'' because of such disorders. No 
changes are made based on this comment. The restrictions for this 
category are required by 38 U.S.C. 1710(e).
    One commenter asserted that the final rule should include provision 
for ``long-term care services.'' No changes are made based on this 
comment. The medical benefits package includes non-institutional long-
term care services, such as home health care. The statutory framework 
for the enrollment system does not cover nursing home care.
    The medical benefits package includes prescription drugs available 
under the VA national formulary system. Commenters argued that this is 
inadequate based on the assertion that this would limit drugs only to 
those listed and exclude any opportunity for using non-listed drugs. No 
changes are made based on these comments. The national formulary system 
includes a mechanism for the provision of drugs and medicines not 
listed in the formulary.
    Commenters recommend that the ``medical benefits package'' include 
a statement that VA will maintain its capacity to treat disabled 
veterans in accordance with the provisions of 38 U.S.C. 1706. No 
changes are made based on these comments. The statutory provisions are 
adequate by themselves to provide notice of this requirement.
    Commenters asserted that a determination regarding care received 
under the ``medical benefits package'' should only be made by a 
physician in the appropriate medical specialty and that a veteran 
should have direct access to the medical specialist of choice. No 
changes are made based on these comments. Consistent with the trends in 
industry practice, we believe that generally veterans should first meet 
with primary care healthcare professionals and then be referred to 
medical specialists, if necessary.
    Commenters asserted that the letter that VA sends veterans 
concerning their enrollment status should specify what services are 
available to enrollees. No changes are made based on these comments. 
The enrollment status letter will provide an overview of the services 
available and will include a toll-free telephone number for veterans to 
call for further information.
    We also have made a clarifying change to the medical benefits 
package to state that it includes the completion of certain forms 
(e.g., Family Medical Leave forms, life insurance applications, 
Department of Education forms for loan repayment exemptions based on 
disability, non-VA disability program forms) by healthcare 
professionals based on an examination or knowledge of the veteran's 
condition, but not including the completion of forms for examinations 
where payment for such examinations cannot be paid to VA but can be 
paid to other health care practitioners. This is a medical service that 
generally is provided under customary medical practice.

Notice of Priority Categories Eligible for Enrollment

    The proposed rule provided for the Secretary to publish notices in 
the notice section of the Federal Register announcing which categories 
of veterans are eligible to be enrolled. One commenter asserted that 
the determinations made must be published as rules and that such rules 
can be made only after prior notice and comment. In response, we have 
changed the provisions of the final rule to provide for inclusion of 
the announcements by the Secretary in the regulatory material at 
Sec. 17.36. Determinations regarding notice and comment will be made in 
accordance with the provisions of the Administrative Procedure Act.
    Also, the criteria in Sec. 17.36 for determining which categories 
of veterans are eligible to be enrolled are clarified to more 
accurately reflect the elements necessary for making the determination.

Appeals

    Commenters asserted that the proposed rule did not contain 
sufficient notice of appeal rights for enrollment determinations. In 
response, we have added information to Sec. 17.36(d)(5) stating that 
the letter providing notification of enrollment status (enrollment or 
disenrollment) will include an effective date for any changes and will 
include a statement regarding appeal rights.
    As stated in the proposal, veterans may appeal VA decisions 
regarding enrollment and disenrollment to the Board of Veterans' 
Appeals and the Court of Veterans Appeals. Commenters asserted that 
actions on appeals to the Board take too long and that special 
intermediate appeal procedures must be established to protect veterans' 
access to healthcare. Most of the enrollment determinations will be 
based on the ministerial application of determinations made by the VA's 
Veterans Benefits Administration. There is already a process for 
obtaining reconsideration of these VBA determinations at the Regional 
Office level. It would be inappropriate for VA's Veterans Health 
Administration (VHA) which administers the National Enrollment System 
to provide appellate rights for these VBA issues. Further, although we 
are not required to do so, we are in the process of formulating 
voluntary intermediate reconsideration procedures for VHA decisions (63 
FR 9990). In this regard, we are considering whether to apply such 
voluntary intermediate appeal procedures to certain VHA enrollment 
issues, such as decisions concerning catastrophic disabilities and 
means testing.
    One commenter asserted that a veteran should not lose benefits for 
at least 90 days or until the completion of an appeal. No changes are 
made based on this comment. We have no authority to establish such a 
rule.
    Commenters asserted that the Presidential Memorandum on Federal 
Agency Compliance with the Patient Bill of Rights requires appeal 
procedures for enrollment issues. No changes are made based on these 
comments. This Memorandum was intended to ensure additional process for 
medical determinations not subject to the appellate jurisdiction of the 
Board of Veterans Appeals, such as the need for and appropriateness of 
specific types of medical care and treatment for an individual. 
Further, as noted above, we are taking steps to establish intermediate 
appeal procedures as appropriate.
    Commenters asserted that the final rule should specifically state 
that the Board of Veterans Appeals has appellate jurisdiction of VHA 
determinations concerning whether a veteran is catastrophically 
disabled. No changes are made based on these comments. We agree that 
under 38 CFR 20.101(b) the Board has jurisdiction over these 
determinations. Further, we do not believe that there is a need to 
include specific provisions in the final rule regarding this matter.

Miscellaneous

    Non-substantive changes have been made for purposes of 
clarification.

Announcement Regarding Enrollment of Priority Categories

    VA will enroll all 7 priority categories of veterans for the period 
October 1,

[[Page 54212]]

1999 through September 30, 2000, unless changed by a subsequent 
rulemaking document.

OMB

    This document has been reviewed by the Office of Management and 
Budget under Executive Order 12866.

Paperwork Reduction Act

    The collection of information contained in the notice of the 
proposed rulemaking was submitted to the Office of Management and 
Budget (OMB) for review in accordance with the Paperwork Reduction Act 
(44 U.S.C. 3504(h)). The information collection subject to this 
rulemaking concerns:
    (1) Initial Application for Health Benefits. Under the provisions 
of Sec. 17.36(d)(1), a veteran who wishes to be enrolled must apply by 
submitting a VA Form 10-10EZ to a VA medical facility. Veterans 
applying based on inclusion in categories 1, 2, 3, 6, and 7 do not need 
to complete section II, but must complete the rest of the form. 
Veterans applying based on inclusion in priority category 4 must 
complete all or a portion of VA Form 10-10EZ as set forth in 
Sec. 17.36(d)(1). Veterans applying based on inclusion in priority 
category 5 must complete the entire form. VA Form 10-10EZ is set forth 
in full at Sec. 17.36(f). This information is needed to determine 
whether a veteran is eligible to be enrolled in the VA healthcare 
system and, consequently, whether the veteran is eligible for VA 
hospital and outpatient care;
    (2) Yearly Re-application for Health Benefits. Under the provisions 
of Sec. 17.36(d)(4)(iii), veterans enrolled based on inclusion in 
priority category 5 will be mailed a Form 10-10EZ on a yearly basis. 
They will be requested to complete the form and return the form to the 
address on the return envelope. VA Form 10-10EZ is set forth in full at 
Sec. 17.36(f). This information is needed to determine whether a 
veteran is eligible to continue to be enrolled in the VA healthcare 
system, and, consequently, whether the veteran is eligible to continue 
to receive VA hospital and outpatient care;
    (3) Voluntary disenrollment. Under the provisions of 
Sec. 17.36(d)(4)(i), a veteran wishing to disenroll and forgo VA 
hospital and outpatient care must submit to a VA medical center a 
signed document stating that the veteran no longer wishes to be 
enrolled. This information is needed to determine the identity of those 
veterans wishing to disenroll and forgo VA hospital and outpatient 
care. This will help VA determine how to allocate available funding for 
hospital and outpatient care.
    Interested parties were invited to submit comments on the 
collection of information. However, no comments were received. OMB has 
approved this information collection under control number 2900-0091.
    VA is not authorized to impose a penalty on persons for failure to 
comply with information collection requirements which do not display a 
current OMB control number, if required.

Regulatory Flexibility Act

    The Secretary hereby certifies that this proposed rule will not 
have a significant economic impact on a substantial number of small 
entities as they are defined in the Regulatory Flexibility Act, 5 
U.S.C. 601-612. This proposed rule would affect only individuals. 
Accordingly, pursuant to 5 U.S.C. 605(b), this proposed rule is exempt 
from the initial and final regulatory flexibility analysis requirements 
of Secs. 603 and 604.
    The Catalog of Federal domestic assistance numbers for the programs 
affected by this rule are 64.005, 64.007.64.008, 64,009, 64.010, 
64.011, 64.012, 64.013, 64.014, 64.015, 64.016, 64.018, 64.019, 64.022, 
and 64.025.

List of Subjects in 38 CFR Part 17

    Administrative practice and procedure, Alcohol abuse, Alcoholism, 
Claims, Day care, Dental health, Drug abuse, Foreign relations, 
Government contracts, Grant programs-- health, Grant programs--
veterans, Health care, Health facilities, Health professions, Health 
records, Homeless, Medical and dental schools, Medical devices, Medical 
research, Mental health programs, Nursing homes, Philippines, Reporting 
and recordkeeping requirements, Scholarships and fellowships, Travel 
and transportation expenses, Veterans.

    Approved: July 16, 1999.
Togo D. West, Jr.,
Secretary of Veterans Affairs.
    For the reasons set out in the preamble, 38 CFR part 17 is amended 
as set forth below:

PART 17--MEDICAL

    1. The authority citation for part 17 continues to read as follows:

    Authority: 38 U.S.C. 501, 1721, unless otherwise noted.


Sec. 17.34  [Amended]

    2. The first sentence of Sec. 17.34 is amended by removing ``When 
an application'' and adding, in its place, ``Subject to the provisions 
of Secs. 17.36 through 17.38, when an application''.
    3. An undesignated center heading, Sec. 17.36, and a parenthetical 
at the end of the section are added to read as follows:

Enrollment Provisions and Medical Benefits Package


Sec. 17.36  Enrollment--provision of hospital and outpatient care to 
veterans.

    (a) Enrollment requirement for veterans. (1) Except as otherwise 
provided in Sec. 17.37, a veteran must be enrolled in the VA healthcare 
system as a condition for receiving VA hospital and outpatient care.

    Note to paragraph (a)(1): A veteran may apply to be enrolled at 
any time. (See Sec. 17.36(d)(1).)

    (2) Except as provided in paragraph (a)(3) of this section, a 
veteran enrolled under this section is eligible for VA hospital and 
outpatient care as provided in the ``medical benefits package'' set 
forth in Sec. 17.38.

    Note to paragraph (a)(2): A veteran's enrollment status will be 
recognized throughout the United States.

    (3) A veteran enrolled based on having a disorder associated with 
exposure to a toxic substance or radiation, for a disorder associated 
with service in the Southwest Asia theater of operations during the 
Gulf War, or any illness associated with service in combat in a war 
after the Gulf War or during a period of hostility after November 11, 
1998, as provided in 38 U.S.C. 1710(e), is eligible for VA hospital and 
outpatient care provided in the ``medical benefits package'' set forth 
in Sec. 17.38 for the disorder.
    (b) Categories of veterans eligible to be enrolled. The Secretary 
will determine which categories of veterans are eligible to be enrolled 
based on the following order of priority:
    (1) Veterans with a singular or combined rating of 50 percent or 
greater based on one or more service-connected disabilities or 
unemployability.
    (2) Veterans with a singular or combined rating of 30 percent or 40 
percent based on one or more service-connected disabilities.
    (3) Veterans who are former prisoners of war; veterans with a 
singular or combined rating of 10 percent or 20 percent based on one or 
more service-connected disabilities; veterans who were discharged or 
released from active military service for a disability incurred or 
aggravated in the line of duty; veterans who receive disability 
compensation under 38 U.S.C. 1151; veterans whose entitlement to 
disability compensation is suspended pursuant to 38 U.S.C. 1151, but 
only to the extent

[[Page 54213]]

that such veterans' continuing eligibility for hospital and outpatient 
care is provided for in the judgment or settlement described in 38 
U.S.C. 1151; veterans whose entitlement to disability compensation is 
suspended because of the receipt of military retired pay; and veterans 
receiving compensation at the 10 percent rating level based on multiple 
noncompensable service-connected disabilities that clearly interfere 
with normal employability.
    (4) Veterans who receive increased pension based on their need for 
regular aid and attendance or by reason of being permanently housebound 
and other veterans who are determined to be catastrophically disabled 
by the Chief of Staff (or equivalent clinical official) at the VA 
facility where they were examined; except that a veteran who is 
catastrophically disabled and who must agree under 38 U.S.C. 1710 to 
pay to the United States a co-payment as condition of receiving VA 
care, must agree to pay to the United States the applicable co-payment 
to be enrolled in priority category 4.
    (5) Veterans not covered by paragraphs (b)(1) through (b)(4) of 
this section who are determined to be unable to defray the expenses of 
necessary care under 38 U.S.C. 1722(a).
    (6) Veterans of the Mexican border period or of World War I; 
veterans solely seeking care for a disorder associated with exposure to 
a toxic substance or radiation, for a disorder associated with service 
in the Southwest Asia theater of operations during the Gulf War, or for 
any illness associated with service in combat in a war after the Gulf 
War or during a period of hostility after November 11, 1998, as 
provided and limited in 38 U.S.C. 1710(e); and veterans with 0 percent 
service-connected disabilities who are nevertheless compensated, 
including veterans receiving compensation for inactive tuberculosis.
    (7) Veterans who agree to pay to the United States the applicable 
copayment determined under 38 U.S.C. 1710(f) and 1710(g). This category 
is further prioritized into the following subcategories:
    (i) Noncompensable zero percent service-connected veterans; and
    (ii) All other priority category 7 veterans.
    (c) Federal Register notification of eligible enrollees. (1) It is 
anticipated that on or before August 1 of each year the Secretary will 
announce in paragraph (c)(2) of this section which categories of 
veterans are eligible to be enrolled. As necessary, the Secretary at 
any time may revise this determination by further amending paragraph 
(c)(2) of this section. The preamble to a Federal Register document 
announcing which priority categories are eligible to be enrolled must 
specify the projected number of fiscal year applicants for enrollment 
in each priority category, projected healthcare utilization and 
expenditures for veterans in each priority category, appropriated funds 
and other revenue projected to be available for fiscal year enrollees, 
and results--projected total expenditures for enrollees by priority 
category. The determination should include consideration of relevant 
internal and external factors, e.g., economic changes, changes in 
medical practices, and waiting times to obtain an appointment for care. 
Consistent with these criteria, the Secretary will determine which 
categories of veterans are eligible to be enrolled based on the order 
of priority specified in paragraph (b) of this section.
    (2) Unless changed by a rulemaking document in accordance with 
paragraph (c)(1) of this section, VA will enroll all priority 
categories of veterans set forth in Sec. 17.36(b) for the period from 
October 1, 1999 through September 30, 2000.
    (d) Enrollment and disenrollment process--(1) Application for 
enrollment. A veteran may apply to be enrolled in the VA healthcare 
system at any time. A veteran who wishes to be enrolled must apply by 
submitting a VA Form 10-10EZ to a VA medical facility. Veterans 
applying based on inclusion in priority categories 1, 2, 3, 6, and 7 do 
not need to complete section II, but must complete the rest of the 
form. Veterans applying based on inclusion in priority category 4 
because of their need for regular aid and attendance or by being 
permanently housebound need not complete section II, but must complete 
the rest of the form. Veterans applying based on inclusion in priority 
category 4 because they are catastrophically disabled need not complete 
section II, but must complete the rest of the form, if: they agree to 
pay to the United States the applicable copayment determined under 38 
U.S.C. 1710(f) and 1710(g); they are a veteran of the Mexican border 
period or of World War I or a veteran with a 0 percent service-
connected disability who is nevertheless compensated; their 
catastrophic disability is a disorder associated with exposure to a 
toxic substance or radiation, or with service in the Southwest Asia 
theater of operations during the Gulf War as provided in 38 U.S.C. 
1710(e); or their catastrophic disability is an illness associated with 
service in combat in a war after the Gulf War or during a period of 
hostility after November 11, 1998, as provided in 38 U.S.C. 1710(e). 
All other veterans applying based on inclusion in priority category 4 
because they are catastrophically disabled must complete the entire 
form. Veterans applying based on inclusion in priority category 5 must 
complete the entire form. VA Form 10-10EZ is set forth in paragraph (f) 
of this section and is available from VA medical facilities.

    Note to paragraph (d)(1): To remain enrolled based on inclusion 
in priority category 5, a veteran annually must return information 
to VA on a VA Form 10-10EZ as provided in paragraph (d)(4)(iii) of 
this section and otherwise meet the requirements for enrollment.

    (2) Action on application. Upon receipt of a completed VA Form 10-
10EZ, a VA network or facility director, or the Chief Network Officer, 
will accept a veteran as an enrollee upon determining that the veteran 
is in a priority category eligible to be enrolled as set forth in 
Sec. 17.36(c)(2). Upon determining that a veteran is not in a priority 
category eligible to be enrolled, the VA network or facility director, 
or the Chief Network Officer, will inform the applicant that the 
applicant is ineligible to be enrolled.
    (3) Automatic enrollment. Notwithstanding other provisions of this 
section, veterans who were notified by VA letter that they were 
enrolled in the VA healthcare system under the trial VA enrollment 
program prior to October 1, 1998, automatically will be enrolled in the 
VA healthcare system under this section if determined by a VA network 
or facility director, or the Chief Network Officer, that the veteran is 
in a priority category eligible to be enrolled as set forth in 
Sec. 17.36(c)(2). Upon determining that a veteran is not in a priority 
category eligible to be enrolled, the VA network or facility director, 
or the Chief Network Officer, will inform the veteran that the veteran 
is ineligible to be enrolled.
    (4) Disenrollment. A veteran enrolled under paragraph (d)(2) or 
(d)(3) of this section will be disenrolled only if:
    (i) The veteran submits to a VA medical center a signed document 
stating that the veteran no longer wishes to be enrolled;
    (ii) A VA network or facility director, or the Chief Network 
Officer, determines that the veteran is no longer in a priority 
category eligible to be enrolled, as set forth in Sec. 17.36(c)(2); or
    (iii) A VA network or facility director, or the Chief Network 
Officer, determines that the veteran has been enrolled based on 
inclusion in priority category 5; determines that the veteran was sent 
by mail a VA Form 10-10EZ; and determines that the veteran failed to

[[Page 54214]]

return the completed form to the address on the return envelope within 
60 days from receipt of the form. VA Form 10-10EZ is set forth in 
paragraph (f) of this section.
    (5) Notification of enrollment status. Notice of a decision by a VA 
network or facility director, or the Chief Network Officer, regarding 
enrollment status will be provided to the affected veteran by letter 
and will contain the reasons for the decision. The letter will include 
an effective date for any changes and a statement regarding appeal 
rights. The decision will be based on all information available to the 
decisionmaker, including the information contained in VA Form 10-10EZ.
    (e) Catastrophically disabled. For purposes of this section, 
catastrophically disabled means to have a permanent severely disabling 
injury, disorder, or disease that compromises the ability to carry out 
the activities of daily living to such a degree that the individual 
requires personal or mechanical assistance to leave home or bed or 
requires constant supervision to avoid physical harm to self or others. 
This definition is met if an individual has been found by the Chief of 
Staff (or equivalent clinical official) at the VA facility where the 
individual was examined to have a permanent condition specified in 
paragraph (e)(1) of this section; to meet permanently one of the 
conditions specified in paragraph (e)(2) of this section by a clinical 
evaluation of the patient's medical records that documents that the 
patient previously met the permanent criteria and continues to meet 
such criteria (permanently) or would continue to meet such criteria 
(permanently) without the continuation of on-going treatment; or to 
meet permanently one of the conditions specified in paragraph (e)(2) of 
this section by a current medical examination that documents that the 
patient meets the permanent criteria and will continue to meet such 
criteria (permanently) or would continue to meet such criteria 
(permanently) without the continuation of on-going treatment.
    (1) Quadriplegia and quadriparesis (ICD-9-CM Code 344.0x: 344.00, 
344.01, 344.02, 344.03, 344.04, 3.44.09), paraplegia (ICD-9-CM Code 
344.1), blindness (ICD-9-CM Code 369.4), persistent vegetative state 
(ICD-9-CM Code 780.03), or a condition resulting from two of the 
following procedures (ICD-9-CM Code 84.x or associated V Codes when 
available or Current Procedural Terminology (CPT) Codes) provided the 
two procedures were not on the same limb:
    (i) Amputation through hand (ICD-9-CM Code 84.03 or V Code V49.63 
or CPT Code 25927);
    (ii) Disarticulation of wrist (ICD-9-CM Code 84.04 or V Code V49.64 
or CPT Code 25920);
    (iii) Amputation through forearm (ICD-9-CM Code 84.05 or V Code 
V49.65 or CPT Codes 25900, 25905);
    (iv) Disarticulation of forearm (ICD-9-CM Code 84.05 or V Code 
V49.66 or CPT Codes 25900, 25905);
    (v) Amputation or disarticulation through elbow. (ICD-9-CM Code 
84.06 or V Code V49.66 or CPT 24999);
    (vi) Amputation through humerus (ICD-9-CM Code 84.07 or V Code 
V49.66 or CPT Codes 24900, 24920);
    (vii) Shoulder disarticulation (ICD-9-CM Code 84.08 or V Code 
V49.67 or CPT Code 23920);
    (viii) Forequarter amputation (ICD-9-CM Code 84.09 or CPT Code 
23900);
    (ix) Lower limb amputation not otherwise specified (ICD-9-CM Code 
84.10 or V Code V49.70 or CPT Codes 27880, 27882);
    (x) Amputation of great toe (ICD-9-CM Code 84.11 or V Code V49.71 
or CPT Codes 28810, 28820);
    (xi) Amputation through foot (ICD-9-CM Code 84.12 or V Code V49.73 
or CPT Codes 28800, 28805);
    (xii) Disarticulation of ankle (ICD-9-CM Code 84.13 or V Code 
V49.74 or CPT 27889);
    (xiii) Amputation through malleoli (ICD-9-CM Code 84.14 or V Code 
V49.75 or CPT Code 27888);
    (xiv) Other amputation below knee (ICD-9-CM Code 84.15 or V Code 
V49.75 or CPT Codes 27880, 27882);
    (xv) Disarticulation of knee (ICD-9-CM Code 84.16 or V Code V49.76 
or CPT Code 27598);
    (xvi) Above knee amputation (ICD-9-CM Code 84.17 or V Code V49.76 
or CPT Code 27598);
    (xvii) Disarticulation of hip (ICD-9-CM Code 84.18 or V Code V49.77 
or CPT Code 27295); and
    (xviii) Hindquarter amputation (ICD-9-CM Code 84.19 or CPT Code 
27290).
    (2)(i) Dependent in 3 or more Activities of Daily Living (eating, 
dressing, bathing, toileting, transferring, incontinence of bowel and/
or bladder), with at least 3 of the dependencies being permanent with a 
rating of 1, using the Katz scale.
    (ii) A score of 10 or lower using the Folstein Mini-Mental State 
Examination.
    (iii) A score of 2 or lower on at least 4 of the 13 motor items 
using the Functional Independence Measure.
    (iv) A score of 30 or lower using the Global Assessment of 
Functioning.
    (f) VA Form 10-10EZ. [insert actual photocopy of VA Form 10-10EZ]

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[[Page 54217]]

    (The Office of Management and Budget has approved the information 
collection requirements in this section under control number 2900-
0091.)

    Authority: 38 U.S.C. 101, 501, 1701, 1705, 1710, 1721, 1722.

    4. A new Sec. 17.37 is added to read as follows:


Sec. 17.37 Enrollment not required--provision of hospital and 
outpatient care to veterans.

    Even if not enrolled in the VA healthcare system:
    (a) A veteran rated for service-connected disabilities at 50 
percent or greater will receive VA hospital and outpatient care 
provided for in the ``medical benefits package'' set forth in 
Sec. 17.38.
    (b) A veteran who has a service-connected disability will receive 
VA hospital and outpatient care provided for in the ``medical benefits 
package'' set forth in Sec. 17.38 for that service-connected 
disability.
    (c) A veteran who was discharged or released from active military 
service for a disability incurred or aggravated in the line of duty 
will receive VA hospital and outpatient care provided for in the 
``medical benefits package'' set forth in Sec. 17.38 for that 
disability for the 12-month period following discharge or release.
    (d) When there is a compelling medical need to complete a course of 
VA treatment started when the veteran was enrolled in the VA healthcare 
system, a veteran will receive that treatment.
    (e) Subject to the provisions of Sec. 21.240, a veteran 
participating in VA's vocational rehabilitation program described in 
Secs. 21.1 through 21.430 will receive VA hospital and outpatient care 
provided for in the ``medical benefits package'' set forth in 
Sec. 17.38.
    (f) A veteran may receive VA hospital and outpatient care based on 
factors other than veteran status (e.g., a veteran who is a private-
hospital patient and is referred to VA for a diagnostic test by that 
hospital under a sharing contract; a veteran who is a VA employee and 
is examined to determine physical or mental fitness to perform official 
duties; a Department of Defense retiree under a sharing agreement).
    (g) For care not provided within a State, a veteran may receive VA 
hospital and outpatient care provided for in the ``medical benefits 
package'' set forth in Sec. 17.38 if authorized under the provisions of 
38 U.S.C. 1724 and 38 CFR 17.35.
    (h) Commonwealth Army veterans and new Philippine Scouts may 
receive hospital and outpatient care provided for in the ``medical 
benefits package'' set forth in Sec. 17.38 if authorized under the 
provisions of 38 U.S.C. 1724 and 38 CFR 17.35.
    (i) A veteran may receive certain types of VA hospital and 
outpatient care not included in the ``medical benefits package'' set 
forth in Sec. 17.38 if authorized by statute or other sections of 38 
CFR (e.g., humanitarian emergency care for which the individual will be 
billed, compensation and pension examinations, dental care, domiciliary 
care, nursing home care, readjustment counseling, care as part of a VA-
approved research project, seeing-eye or guide dogs, sexual trauma 
counseling and treatment, special registry examinations).
    (j) A veteran may receive an examination to determine whether the 
veteran is catastrophically disabled and therefore eligible for 
inclusion in priority category 4.

    Authority: 38 U.S.C. 101, 501, 1701, 1705, 1710, 1721, 1722.

    5. A new Sec. 17.38 is added to read as follows:


Sec. 17.38 Medical benefits package.

    (a) Subject to paragraphs (b) and (c) of this section, the 
following hospital and outpatient care constitutes the ``medical 
benefits package'' (basic care and preventive care):
    (1) Basic care.
    (i) Outpatient medical, surgical, and mental healthcare, including 
care for substance abuse.
    (ii) Inpatient hospital, medical, surgical, and mental healthcare, 
including care for substance abuse.
    (iii) Prescription drugs, including over-the-counter drugs and 
medical and surgical supplies available under the VA national formulary 
system.
    (iv) Emergency care in VA facilities; and emergency care in non-VA 
facilities in accordance with sharing contracts or if authorized by 
Secs. 17.52(a)(3), 17.53, 17.54, 17.120-132.
    (v) Bereavement counseling as authorized in Sec. 17.98.
    (vi) Comprehensive rehabilitative services other than vocational 
services provided under 38 U.S.C. chapter 31.
    (vii) Consultation, professional counseling, training, and mental 
health services for the members of the immediate family or legal 
guardian of the veteran or the individual in whose household the 
veteran certifies an intention to live, if needed to treat:
    (A) The service-connected disability of a veteran; or
    (B) The nonservice-connected disability of a veteran where these 
services were first given during the veteran's hospitalization and 
continuing them is essential to permit the veteran's release from 
inpatient care.
    (viii) Durable medical equipment and prosthetic and orthotic 
devices, including eyeglasses and hearing aids as authorized under 
Sec. 17.149.
    (ix) Home health services authorized under 38 U.S.C. 1717 and 
1720C.
    (x) Reconstructive (plastic) surgery required as a result of 
disease or trauma, but not including cosmetic surgery that is not 
medically necessary.
    (xi) Respite, hospice, and palliative care.
    (xii) Payment of travel and travel expenses for veterans eligible 
under Sec. 17.143 if authorized by that section.
    (xiii) Pregnancy and delivery services, to the extent authorized by 
law.
    (xiv) Completion of forms (e.g., Family Medical Leave forms, life 
insurance applications, Department of Education forms for loan 
repayment exemptions based on disability, non-VA disability program 
forms) by healthcare professionals based on an examination or knowledge 
of the veteran's condition, but not including the completion of forms 
for examinations if a third party customarily will pay health care 
practitioners for the examination but will not pay VA.
    (2) Preventive care, as defined in 38 U.S.C. 1701(9), which 
includes:
    (i) Periodic medical exams.
    (ii) Health education, including nutrition education.
    (iii) Maintenance of drug-use profiles, drug monitoring, and drug 
use education.
    (iv) Mental health and substance abuse preventive services.
    (v) Immunizations against infectious disease.
    (vi) Prevention of musculoskeletal deformity or other gradually 
developing disabilities of a metabolic or degenerative nature.
    (vii) Genetic counseling concerning inheritance of genetically 
determined diseases.
    (viii) Routine vision testing and eye-care services.
    (ix) Periodic reexamination of members of high-risk groups for 
selected diseases and for functional decline of sensory organs, and the 
services to treat these diseases and functional declines.
    (b) Provision of the ``medical benefits package''. Care referred to 
in the ``medical benefits package'' will be provided to individuals 
only if it is determined by appropriate healthcare professionals that 
the care is needed to promote, preserve, or restore the health of the 
individual and is in accord with generally accepted standards of 
medical practice.

[[Page 54218]]

    (1) Promote health. Care is deemed to promote health if the care 
will enhance the quality of life or daily functional level of the 
veteran, identify a predisposition for development of a condition or 
early onset of disease which can be partly or totally ameliorated by 
monitoring or early diagnosis and treatment, and prevent future 
disease.
    (2) Preserve health. Care is deemed to preserve health if the care 
will maintain the current quality of life or daily functional level of 
the veteran, prevent the progression of disease, cure disease, or 
extend life span.
    (3) Restoring health. Care is deemed to restore health if the care 
will restore the quality of life or daily functional level that has 
been lost due to illness or injury.
    (c) In addition to the care specifically excluded from the 
``medical benefits package'' under paragraphs (a) and (b) of this 
section, the ``medical benefits package'' does not include the 
following:
    (1) Abortions and abortion counseling.
    (2) In vitro fertilization.
    (3) Drugs, biologicals, and medical devices not approved by the 
Food and Drug Administration unless the treating medical facility is 
conducting formal clinical trials under an Investigational Device 
Exemption (IDE) or an Investigational New Drug (IND) application, or 
the drugs, biologicals, or medical devices are prescribed under a 
compassionate use exemption.
    (4) Gender alterations.
    (5) Hospital and outpatient care for a veteran who is either a 
patient or inmate in an institution of another government agency if 
that agency has a duty to give the care or services.
    (6) Membership in spas and health clubs.

    Authority: 38 U.S.C. 101, 501, 1701, 1705, 1710, 1721, 1722.


Sec. 17.43  [Amended]

    6. In Sec. 17.43, paragraph (a) is removed and paragraphs (b) 
through (e) are redesignated as paragraphs (a) through (d), 
respectively.


Sec. 17.47 [Amended]

    7. In Sec. 17.47, paragraph (h) is removed; paragraphs (i) through 
(l) are redesignated as paragraphs (h) through (k), respectively; and 
newly redesignated paragraph (h) is amended by removing ``hospital or'' 
and by removing ``or hospital care in a Federal hospital under 
agreement,''.


Sec. 17.93  [Amended]

    8. In Sec. 17.93, paragraph (a)(2) is amended by removing ``Medical 
services'' and adding, in its place, ``Subject to the provisions of 
Secs. 17.36 through 17.38, medical services''.


Sec. 17.99  [Removed]

    9. Section 17.99 is removed.


Sec. 17.100  [Amended]

    10. In Sec. 17.100, the third sentence is amended by removing ``a 
new application is filed, and''.

[FR Doc. 99-25871 Filed 10-5-99; 8:45 am]
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