Last updated 2026-02-18T21:04:44Z

Financial Integrity Resource Management (FIRM) Audit

The overbilling issue in community-based care services stems from misalignment between VA-approved service hours, the VA-created Standard Episode of Care (SEOC) ranges, and the third-party administrator (TPA) payment adjudication system. This discrepancy has resulted in significant overpayments for in-home services. For example, when the VA approved 4 hours of care per week, agencies bill and receive payment for numerous ranges up to 20 hours per week as allowed by SEOC ranges.

Origin:

October 2024, Audie L. Murphy Memorial Veterans' Hospital (San Antonio, Texas)

Adoptions:

1 in-progress

Awards and Recognition:

2026 VHA IE Entrepreneur in Residence

Overview

Problem

The main problem outlined vendors were allowed to overbill for home and community based services. The standard episode of care and third party administrator contracts stipulate payment terms but fail to effectively convey the VA approved service hours. VA staff outline the approved service hours on the consult, which is forwarded to community vendors, howeve ... The main problem outlined vendors were allowed to overbill for home and community based services. The standard episode of care and third party administrator contracts stipulate payment terms but fail to effectively convey the VA approved service hours. VA staff outline the approved service hours on the consult, which is forwarded to community vendors, however this information may not be visible for third party payment centers. To recap, overbilling payments occur with missed third party vendor communication and allows a vendor to bill for the maximum standard episode of care. See more

Solution

A monitoring application was developed to track approved care hours against third-party payments, SEOC VA staff authorized hours, and flagging discrepancies. When an overpayment is identified for a single agency, a comprehensive review is initiated for Veterans receiving in-home care from that vendor. The total overpayment amount is calculated for the durati ... A monitoring application was developed to track approved care hours against third-party payments, SEOC VA staff authorized hours, and flagging discrepancies. When an overpayment is identified for a single agency, a comprehensive review is initiated for Veterans receiving in-home care from that vendor. The total overpayment amount is calculated for the duration of the authorization period, encompassing multiple authorization reviews. See more

Results

Overbilling totals are submitted to the internal revenue office (IRO). If facility recoupment is approved, a formal notification letter is issued to the vendor detailing the overbilling findings and instructions for submitting a corrected rebilling claim. Upon submission, the claim generates a debt of collection, and the agency remits payment to the third-pa ... Overbilling totals are submitted to the internal revenue office (IRO). If facility recoupment is approved, a formal notification letter is issued to the vendor detailing the overbilling findings and instructions for submitting a corrected rebilling claim. Upon submission, the claim generates a debt of collection, and the agency remits payment to the third-party administrator. See more

Metrics

$88,481.17 in overbilled claims was identified using FIRM Audit between FY24-25.
$46,793.90 was recouped using FIRM Audit between FY24-25.

Diffusion tracker

Does not include Clinical Resource Hubs (CRH)

There are no successful adoptions for this innovation.

TX: Audie L. Murphy Memorial Veterans' Hospital (San Antonio, Texas)

Started adoption on 10/2024.

There are no unsuccessful adoptions for this innovation.

Implementation

Departments

Finance department
Community Care
Extended care and rehabilitation
Geriatrics

Core Resources

Resource type	Resource description
PEOPLE	Coming Soon!

Risks and mitigations

Risk	Mitigation
Vendors unwilling to return overpayment	Financial Service Center (FSC) collaboration for garnishment of future payments to unwilling vendors.
Vendors no longer in business	Collaboration with legal/Office of Inspector General (OIG) to determine repayment opportunities from a closed vendor.
Third Party Administrator unwilling to communicate returned funds	Collaboration with Director, Quality Monitoring External Networks for contractual outlines.

Contact

Comment

Comments and replies are disabled for retired innovations and non-VA users.

Email

Email VISN17 STX FIRM AUDIT@VA.GOV with questions about this innovation.

About

Origin story

A couple Veteran families phoned to report their third party administrator explanation of benefits outlined payment amounts far above what the vendor was providing. Review of those claims proved their report was accurate. Additional vendor reviews outlined a pattern of overpayments, directly related to confusion for what was approved by VA and what was the s ... A couple Veteran families phoned to report their third party administrator explanation of benefits outlined payment amounts far above what the vendor was providing. Review of those claims proved their report was accurate. Additional vendor reviews outlined a pattern of overpayments, directly related to confusion for what was approved by VA and what was the standard episode of care range.

Original team

Tammy Sanders, RN

Program Director-Geriatrics Extended Care

Kimberly Lang, RN

Assistant Nurse Manager of Care Coordination Team

Kimberly Oakman, RN

NDTH Expert Liaison for Geriatrics Extended Care

Sandra Sanchez-Reilly, MD

Associate Chief of Staff for Geriatrics Extended Care

Larry Thompson, Pharm D, RPH

Chief of Pharmacy Service

Search tags

Community Care Continuity of Care Coordinated Care Employee Experience Ethics in Health Care Moving Forward Outpatient Care Primary Care Veteran Experience Veterans Benefits

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