[Federal Register Volume 73, Number 209 (Tuesday, October 28, 2008)]
[Proposed Rules]
[Pages 63914-63915]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E8-25646]


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DEPARTMENT OF VETERANS AFFAIRS

38 CFR Part 17

RIN 2900-AM99


Civilian Health and Medical Program of the Department of Veterans 
Affairs (CHAMPVA): Preauthorization for Durable Medical Equipment

AGENCY: Department of Veterans Affairs.

ACTION: Proposed rule.

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SUMMARY: This document proposes to amend the Department of Veterans 
Affairs (VA) regulations for the Civilian Health and Medical Program of 
the Department of Veterans Affairs (CHAMPVA) related to 
preauthorization requirements that apply to the purchase or rental of 
durable medical equipment. It would increase from $300 to $2,000 the 
cost of purchase or rental above which preauthorization would be 
required. This is intended to remove from the CHAMPVA claims process an 
administratively inefficient requirement.

DATES: Comments must be received on or before December 29, 2008.

ADDRESSES: Written comments may be submitted through http://www.Regulations.gov; by mail or hand-delivery to the Director, 
Regulations Management (02REG1), Department of Veterans Affairs, 810 
Vermont Ave., NW., Room 1068, Washington, DC 20420; or by fax to (202) 
273-9026. Comments should indicate that they are submitted in response 
to ``RIN 2900-AM99--CHAMPVA: Preauthorization for DME.'' Copies of 
comments received will be available for public inspection in the Office 
of Regulation Policy and Management, Room 1063B, between the hours of 8 
a.m. and 4:30 p.m., Monday through Friday (except holidays). Please 
call (202) 461-4902 for an appointment. (This is not a toll-free 
number.) In addition, during the comment period, comments may be viewed 
online through the Federal Docket Management System (FDMS) at http://www.Regulations.gov.

FOR FURTHER INFORMATION CONTACT: Richard M. Trabert, Policy Management 
Division, VA Health Administration Center, 3773 Cherry Creek Drive 
North, Denver, CO 80246-9061; (303) 331-7549. (This is not a toll-free 
number.)

SUPPLEMENTARY INFORMATION: This document proposes to amend VA's medical 
regulations in 38 CFR part 17 concerning CHAMPVA. CHAMPVA is a VA 
medical benefits program for (1) spouses and children of veterans who 
have a permanent and total service-connected disability and (2) 
surviving spouses and children of veterans who died as a result of a 
service-connected disability or while rated permanently and totally 
disabled from a service-connected disability, or who died in the active 
military, naval, or air service in the line of duty. CHAMPVA is 
authorized at 38 U.S.C. 1781. To be eligible for CHAMPVA benefits, 
among other requirements, the spouses, surviving spouses, and children 
may not be otherwise eligible for medical care under 10 U.S.C. chapter 
55 (authorizing TRICARE, medical care that is furnished to certain 
dependents and survivors of active duty and retired members of the 
Armed Forces). Needed medical care is largely provided to CHAMPVA 
beneficiaries through non-VA providers.
    Durable medical equipment (DME) is included among the health care 
items that are available to CHAMPVA beneficiaries, provided the DME is 
medically necessary and appropriate for the care of the CHAMPVA 
beneficiary's condition. The determination of medical necessity and 
appropriateness is made by appropriate VA officials. For purposes of 
this regulation, DME is generally equipment or supply that: (1) Can 
withstand repeated use; (2) is primarily and customarily to serve a 
medical purpose; (3) is medically necessary for the treatment of a 
covered illness or injury; and (4) is not otherwise excluded by 
regulation from CHAMPVA coverage.
    To ensure that DME purchases and rental are medically necessary and

[[Page 63915]]

appropriate as well as within the Department's budgetary constraints, 
VA has required non-VA providers to obtain preauthorization before the 
purchase or rental of DME for a CHAMPVA beneficiary when the cost of 
the DME exceeds $300.
    We propose to amend Sec.  17.273(e) by increasing the dollar amount 
above which preauthorization will be required for purchase or rental of 
DME. The proposed rule would increase the dollar amount above which 
preauthorization would be required from $300 to $2,000.
    This increase in the dollar amount above which preauthorization is 
required is necessary to remove an administrative inefficiency in the 
CHAMPVA claims process. Since the $300 ceiling was put into place in 
1973, the cost of common DME items has steadily increased. We conducted 
a review of a sample of our claims that demonstrated we had approved 98 
percent of all requests for DME, but only 93 percent of requests for 
DME having a purchase or total rental price of over $2,000. When DME 
claims are disapproved, it is generally because the DME is determined 
by VA not to be medically necessary and appropriate. We concluded that 
it is not cost effective to review claims of $2,000 or less for medical 
necessity twice, i.e., to review a request when submitted for 
preauthorization and again when the claim is officially submitted for 
payment.
    Raising the dollar amount to $2,000 would make the administrative 
processing of DME claims easier for CHAMPVA beneficiaries and 
providers, as well as for VA. We expect that it would not affect the 
number of claims that are approved. As noted, 98 percent of these 
claims are currently already approved for payment.

Regulatory Flexibility Act

    The Secretary of Veterans Affairs hereby certifies that this 
regulatory amendment 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. Individuals eligible for 
CHAMPVA benefits are widely dispersed geographically and thus services 
provided to them would not have a significant impact on any small 
entity. Therefore, pursuant to 5 U.S.C. 605(b), this proposed rule is 
exempt from the initial and final regulatory flexibility analyses 
requirements of section 603 and 604.

Paperwork Reduction Act of 1995

    This document contains no provisions constituting a new collection 
of information under the Paperwork Reduction Act of 1995 (44 U.S.C. 
3501-3521).

Unfunded Mandates

    The Unfunded Mandates Reform Act of 1995 requires, at 2 U.S.C. 
1532, that agencies prepare an assessment of anticipated costs and 
benefits before issuing any rule that may result in expenditure by 
State, local, or tribal governments, in the aggregate, or by the 
private sector, of $100 million or more (adjusted annually for 
inflation) in any given year. This proposed rule would have no such 
effect on State, local, or tribal governments, or on the private 
sector.

Executive Order 12866

    Executive Order 12866 directs agencies to assess all costs and 
benefits of available regulatory alternatives and, when regulation is 
necessary, to select regulatory approaches that maximize net benefits 
(including potential economic, environmental, public health and safety, 
and other advantages; distributive impacts; and equity). The Executive 
Order classifies a regulatory action as a ``significant regulatory 
action'' requiring review by the Office of Management and Budget (OMB) 
unless OMB waives such review, if it is a regulatory action that is 
likely to result in a rule that may: (1) Have an annual effect on the 
economy of $100 million or more or adversely affect in a material way 
the economy, a sector of the economy, productivity, competition, jobs, 
the environment, public health or safety, or State, local, or tribal 
government or communities; (2) create a serious inconsistency or 
otherwise interfere with an action taken or planned by another agency; 
(3) materially alter the budgetary impact of entitlements, grants, user 
fees, or loan programs or the rights and obligations of recipients 
thereof; or (4) raise novel legal or policy issues arising out of legal 
mandates, the President's priorities, or the principles set forth in 
the Executive Order.
    The economic, interagency, budgetary, legal, and policy 
implications of this proposed rule have been examined and it has been 
determined not to be a significant regulatory action under Executive 
Order 12866.

Catalog of Federal Domestic Assistance

    This proposed rule affects the Civilian Health and Medical Program 
of the Department of Veterans Affairs (CHAMPVA), for which there is no 
Catalog of Federal Domestic Assistance program number.

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, Health facilities, Health 
professionals, Health records, Homeless, Medical and dental schools, 
Medical devices, Medical research, Mental health programs, Nursing 
homes, Philippines, Reporting and recordkeeping requirements, Travel 
and transportation expenses, and Veterans.

    Approved: August 19, 2008.
Gordon H. Mansfield,
Deputy Secretary of Veterans Affairs.

    For the reasons stated above, the Department of Veterans Affairs 
proposes to amend 38 CFR part 17 as follows:

PART 17--MEDICAL

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

    Authority: 38 U.S.C. 501, 1721, and as noted in specific 
sections.


Sec.  17.273  [Amended]

    2. Amend Sec.  17.273(e) by removing ``$300.00'' and adding, in its 
place, ``$2,000.00''.

[FR Doc. E8-25646 Filed 10-27-08; 8:45 am]
BILLING CODE 8320-01-P