Center for Innovation for Care and Payment Update

AGENCY:

Department of Veterans Affairs.

ACTION:

Final rule.

SUMMARY:

The Department of Veterans Affairs (VA) amends its medical regulations governing the Center for Innovation for Care and Payment. This final rule is making several technical revisions to revise the organizational alignment of the Center for Innovation for Care and Payment and to revise where evaluation results are posted for public review for the pilot programs.

DATES:

This rule is effective July 29, 2024.

FOR FURTHER INFORMATION CONTACT:

David Au, Executive Director, VHA Center for Care and Payment Innovation (14HIL3), 810 Vermont Ave. NW, Washington, DC 20420. (202-461-7002). (This is not a toll-free telephone number.)

SUPPLEMENTARY INFORMATION:

On June 6, 2018, section 152 of Public Law 115-182, the John S. McCain III, Daniel K. Akaka, and Samuel R. Johnson VA Maintaining Internal Systems and Strengthening Integrated Outside Networks Act of 2018 (the MISSION Act), amended title 38 of the United States Code (U.S.C.) by adding a new section 1703E. This new section established the Center for Innovation for Care and Payment (the Center) and authorized the conduct of pilot programs designed to develop innovative approaches to testing payment and care models to reduce expenditures while preserving or enhancing the quality of care furnished by VA.

On October 25, 2019, VA published a final rule implementing section 1703E in title 38, Code of Federal Regulations (CFR) 17.450. See 84 Federal Register (FR) 57327. This new regulation, which became effective on November 25, 2019, established the parameters for the Center in its conduct of pilot programs. These parameters included, but were not limited to, geographic location decisions, limitations on the number of pilot programs to be operated at the same time, VA's evaluation and reporting on the pilot programs, and when VA may expand, modify, and terminate pilot programs.

As explained in more detail below, we now amend § 17.450 by making several technical revisions. VA is not making any substantive edits to the content of § 17.450.

Current paragraph (a) of § 17.450 sets forth the purpose and organization of the Center. Paragraph (a)(2) provides that the Center will not operate within any specific administration within VA but rather will operate in VA's corporate portfolio, to ensure the limited number of concurrent pilot programs under § 17.450 are not redundant of or conflicted by ongoing innovation efforts within any specific administration. We explained in the proposed rule for § 17.450 that the Center will be operationally independent from any of VA's three administrations and will be responsible for collaborating across VA to develop and implement pilot programs under this section. 84 FR 36508 (July 29, 2019). As further explained in proposed paragraphs (a)(2) and (3), being operationally independent referred to the decision-making authority of the Center regarding the strategic, procedural, and tactical aspects of managing the pilot programs under this section. Id. However, we received public comments indicating that the proposed language was unclear. See 84 FR 57328-57329 (October 25, 2019). We thus eliminated the reference to and definition of operational independence in proposed paragraph (a)(2) and redesignated paragraph (a)(3) to paragraph (a)(2), which is the language in current 38 CFR 17.450(a)(2). We further clarified in the final rule that the Center is part of VA and acts at the direction of the Secretary, so it is not “independent” from VA. 84 FR 57329.

Consistent with paragraph (a)(2), the Center had operated under VA's Office of Enterprise Integration (OEI), which is a VA corporate level office, since November 25, 2019.

However, since April 5, 2021, the Center has operated under the Office of Discovery, Education, and Affiliate Networks (DEAN) under the Veterans Health Administration (VHA). The Center moved from OEI to DEAN to align these pilot programs with other established, complementary innovation programs that are health-care focused initiatives within VHA and to enable more efficient and effective oversight and execution of all pilot programming which enhances care and service delivery for veterans. As a result, this move has facilitated more efficient daily operations, while continuing to maintain Department-wide connections across VA. More specifically, this move has allowed the Center to leverage the well-established practices of advancing innovation through the VA innovation lifecycle developed and maintained by DEAN and the Office of Healthcare Innovation and Learning (HIL) while still permitting VA to ensure that the pilots managed by the Center are not redundant of or conflict with ongoing innovation efforts within VA; DEAN and HIL have several existing partnerships with programs across VA and have established connections to ensure feedback is considered and integrated into pilot-programming decision-making. This has been achieved through formal governance and through structured collaborations with programs across VA's three administrations (that is, health, benefits, and memorial affairs). This facilitates cross-agency communication, prevents redundant or conflicting efforts, and ensures pilots drive transformational change across VA.

Because the organizational alignment of the Center has moved from VA's corporate portfolio to VHA, we now amend § 17.450(a)(2) to reflect that change. However, in order to avoid amending § 17.450(a)(2) in the future in the event that the name of the office under which the Center will operate changes, we will not add the name of DEAN and will instead state in § 17.450(a)(2) that the Center for Innovation for Care and Payment will operate within the Veterans Health Administration. We are also making a technical edit to the last part of § 17.450(a)(2), which currently states in part that concurrent pilot programs under § 17.450 are not redundant of or conflicted by ongoing innovation efforts within any specific administration. We are removing the phrase “conflicted by” and replacing it with “conflicting with” for clarity. This edit will not change the meaning of the text.

Current § 17.450(g) establishes evaluation and reporting provisions related to the Center. This paragraph states that VA will evaluate each pilot program operated under this section and report its findings. Such evaluations may be based on quantitative data, qualitative data, or both; and whenever appropriate, evaluations will include a survey of participants or beneficiaries to determine their satisfaction with the pilot program. This paragraph further states that VA will make the evaluation results available to the public on the VA Innovation Center website on the schedule identified in VA's proposal for the pilot program. As part of this rulemaking, we are revising the last sentence of paragraph (g) to state that VA will make the evaluation results available to the public on a VA website on the schedule identified in VA's proposal for the pilot program. We reference a VA website instead of the VA Innovation Center website because the specific name of the website and sub-pages for pilot programs vary, and referencing a VA website provides consistency and avoids the potential need for additional regulatory updates; we believe that the broader identification of a VA website in the regulation will allow VA to more accurately and consistently identify the location of the website where the evaluation results for the relevant pilot program will be published. The website will still be identified on the schedule in the proposal for such pilot program.

Administrative Procedure Act

This final rule will neither amend the substantive content of the regulations cited nor have a substantive impact on the public. We are merely providing technical revisions to revise the organizational alignment of the Center for Innovation for Care and Payment and to revise the location of the website where evaluation results are posted for public review for the pilot programs. Consequently, this rule is exempt from the notice-and-comment and delayed-effective-date requirements as a rule of agency organization, procedure, or practice pursuant to section 553(b)(A) in Title 5 of United States Code.

Executive Orders 12866, 13563 and 14094

Executive Order 12866 (Regulatory Planning and Review) directs agencies to assess the 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 effects, and other advantages; distributive impacts; and equity). Executive Order 13563 (Improving Regulation and Regulatory Review) emphasizes the importance of quantifying both costs and benefits, reducing costs, harmonizing rules, and promoting flexibility. Executive Order 14094 (Executive Order on Modernizing Regulatory Review) supplements and reaffirms the principles, structures, and definitions governing contemporary regulatory review established in Executive Order 12866 of September 30, 1993 (Regulatory Planning and Review), and Executive Order 13563 of January 18, 2011 (Improving Regulation and Regulatory Review). The Office of Information and Regulatory Affairs has determined that this rulemaking is not a significant regulatory action under Executive Order 12866, as amended by Executive Order 14094. The Regulatory Impact Analysis associated with this rulemaking can be found as a supporting document at www.regulations.gov.

Regulatory Flexibility Act

The Regulatory Flexibility Act, 5 U.S.C. 601-612, is not applicable to this rulemaking because notice of proposed rulemaking is not required. 5 U.S.C. 601(2), 603(a), 604(a).

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 the expenditure by State, local, and Tribal governments, in the aggregate, or by the private sector, of $100 million or more (adjusted annually for inflation) in any one year. This final rule will have no such effect on State, local, and Tribal governments, or on the private sector.

Paperwork Reduction Act

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

Congressional Review Act

Pursuant to Subtitle E of the Small Business Regulatory Enforcement Fairness Act of 1996 (known as the Congressional Review Act) (5 U.S.C. 801 et seq.), the Office of Information and Regulatory Affairs designated this rule as not satisfying the criteria under 5 U.S.C. 804(2).

Assistance Listing

The Assistance Listing numbers and titles for the programs affected by this document are as follows: 64.007, Blind Rehabilitation Centers; 64.008, Veterans Domiciliary Care; 64.009, Veterans Medical Care Benefits; 64.010, Veterans Nursing Home Care; 64.011, Veterans Dental Care; 64.012, Veterans Prescription Service; 64.013, Veterans Prosthetic Appliances; 64.014, Veterans State Domiciliary Care; 64.015, Veterans State Nursing Home Care; 64.016, Veterans State Hospital Care; 64.018, Sharing Specialized Medical Resources; 64.019, Veterans Rehabilitation Alcohol and Drug Dependence; and 64.022, Veterans Home Based Primary Care.

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

Signing Authority

Denis McDonough, Secretary of Veterans Affairs, approved this document on July 23, 2024, and authorized the undersigned to sign and submit the document to the Office of the Federal Register for publication electronically as an official document of the Department of Veterans Affairs.

For the reasons stated in the preamble, the Department of Veterans Affairs amends 38 CFR part 17 as set forth below:

PART 17—MEDICAL

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

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

2. Amend § 17.450 by revising paragraphs (a)(2) and (g) to read as follows: