Veterans Affairs officials will postpone a controversial rule change regarding ambulance service reimbursements after objections from industry officials and members of Congress who worried the move could endanger some veterans living in rural areas.

Department leaders have not completely given up on the plan, but promised lawmakers on Nov. 22 that they will not implement the changes until February 2025 at the earliest. The new rules had been set to go into effect by mid-February 2024.

VA press secretary Terrence Hayes said leaders are making the reimbursement changes “to better align with the rest of the health care industry.” A VA inspector general report from 2018 found the department had been paying 60% more than typical industry rates for air ambulance services, potentially wasting taxpayer money.

In remarks at the National Press Club earlier this month, VA Secretary Denis McDonough said the goal of new reimbursement rules is not to cut costs for emergency medical care but instead to push local providers into formal contracts with VA for the services, ensuring stability and consistency in pricing.

“As near as we can tell, VA alone among all major health care systems in the country pays for each individual ambulance,” he said. “We’re just paying cash for each run.”

But industry opponents have said sharp cuts in reimbursement rates for ambulance services could severely cripple operations in rural areas, potentially even forcing the closure of some emergency response services.

And lawmakers have decried VA’s proposed fixes as too broad and possibly dangerous. In a statement, Senate Veterans’ Affairs Committee Chairman Jon Tester, D-Mont., hailed the one-year delay as critical time needed to work out disagreements between VA and the emergency services companies.

“The availability of emergency air and ground transportation services in Montana and rural America can be the difference between life and death,” he said. “VA’s hasty implementation of its rate change for these services could have been the final straw for providers in rural America, and I’m glad to see VA answering my call and taking steps to fix this reimbursement issue.”

Both the House and Senate are considering legislation on the issue. Lawmakers can now work on those proposals without a looming deadline early next year.

Ben Clayton, CEO of Life Flight Network, one of the groups involved in the lobbying efforts against the rule change, called the decision “a significant victory” for veterans.

“I look forward to working with the VA to ensure that reimbursement rates for air medical care are sustainable, protecting veteran access to this lifesaving service,” he said. “Although there is still work to be done, this delay reflects a genuine effort by the VA towards a solution.”

Leo covers Congress, Veterans Affairs and the White House for Military Times. He has covered Washington, D.C. since 2004, focusing on military personnel and veterans policies. His work has earned numerous honors, including a 2009 Polk award, a 2010 National Headliner Award, the IAVA Leadership in Journalism award and the VFW News Media award.

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