CMS Pub. 100-16, ch. 8, § 130

Facilities

(Rev. 89; Issued: 11-02-07; Effective/Implementation: 11-02-07)

Section 1814(c) of the Social Security Act (the Act) sets forth the general rule that

Medicare payments may not be made to any Federal provider of services for any item or

service that such provider is obligated by law, or contract with the United States, to render

at public expense. The Department of Veteran Affairs (VA) is a federal provider of

services that is obligated by law to render services to veterans at public expense. The CMS

has clarified that an MA organization is an entity that “stands in the shoes” of Medicare,

and is considered a federal provider of services for purposes of this general rule. This

means that an MA organization may not use Medicare funds to pay the VA Healthcare

System for VA-covered services rendered to veterans who are also MA organization

enrollees. This rule prevails for both elective services and the emergency services rendered

by the VA to veteran MA enrollees.

An MA enrollee who is enrolled in the VA Medical Benefits Plan has dual entitlement to

separate government-funded health care systems. This means that the individual may elect

to receive his or her health care either through the VA system or through his or her MA

plan. If the individual elects to receive routine or non-emergency services through the VA

system, the VA would be obligated by law to pay for those services and the MA

organization would not be permitted to reimburse for such services under the same law.

Similarly, the MA organization is not permitted by law to pay the VA system for

emergency services rendered by the VA to veterans who are MA enrollees. This holds true

regardless of the circumstances underlying the enrollee’s presentation to the VA. Thus, the

prohibition against payment to the VA prevails whether the enrollee self-presented to the

VA (e.g., walk-in patient), was directed there by a treating physician, or was brought to the

VA by ambulance. However, see Chapter 7 (forthcoming) for a discussion of the situation

where an MA plan enrollee with VA coverage is assessed cost sharing by the VA for

receipt of emergency services and this cost sharing exceeds MA plan levels of cost sharing.

Non-Veteran MA enrollees. The rules governing MA organizations’ responsibility for

payment differs for services rendered by the VA to non-veteran MA enrollees. The rule at

§1814(c) of the Act prohibiting payment has no application to non-veterans. Non-veteran

enrollees are covered under §1814(d), which permits payment to be made to hospitals not

contracted with Medicare for emergency services rendered to Medicare beneficiaries.

Under 42 CFR 422.100 and 422.113, MA organizations are responsible for covering

emergency and post-stabilization care services rendered to enrollees. MA organizations are

obligated to reimburse the VA for such services, and would be expected to coordinate care

of non-veteran enrollees who are in a VA hospital due to an emergency as it would in any

other non-contracted or out-of-network hospital.

Exception Under Section 1814(h) of the Act. The rules governing MA organizations’

responsibility for payment for services rendered by the VA to non-veteran MA enrollees

also contain a provision at §1814(h) of the Act for circumstances in which a non-veteran is

admitted to a VA hospital when both the individual and the VA mistakenly believe that the

individual is entitled to VA benefits when in fact they are not. The §1814(h) exception

only applies to the unusual situation in which an MA Organization enrollee who is a non-veteran is mistakenly admitted to a VA hospital for a service that does not require pre-authorization by their MA Organization plan. The CMS expects that this situation would

be very rare.