36C10G20R0014-004.docx

QUALITY ASSURANCE SURVEILLANCE

PLAN (QASP)

VA COMMUNITY CARE NETWORK: REGION 5

VHA COMMUNITY CARE OFFICE

DATE: 06/30/2019

Contract Information and Approval

Contract Number Contractor

Senior Contracting Officer: Date

Review Board Chairperson Date System Program Manager

Fee Determining Official: Date Associate Director for Acquisitions

Table of Contents

List of Tables

Purpose of Quality Assurance Surveillance Plan This Quality Assurance Surveillance Plan (QASP) is pursuant to the requirements listed in the Performance Work Statement (PWS), entitled Community Care Network (CCN) Region 5. This plan sets forth the procedures and guidelines Department of Veterans Affairs – Veteran Health Administration, Office of Community Care (OCC) will use in ensuring the required performance standards or services levels are achieved by the Contractor.

The purpose of the QASP is as follows:

1. The purpose of the QASP is to describe the systematic methods used to monitor performance and to identify the required documentation and the resources to be employed. The QASP provides a means for evaluating whether the Contractor is meeting the performance standards/quality levels identified in the PWS and the Contractor’s Quality Assurance Plan (QAP), and to ensure that the government pays only for the level of services received.

2. This QASP defines the roles and responsibilities of all members of the contract administration team, identifies the performance objectives, defines the methodologies used to monitor and evaluate the Contractor’s performance, describes quality assurance documentation requirements, and describes the analysis of quality assurance monitoring results.

The QASP enables the Contractor to go above requirements to deliver beneficial results for the CCN and subsequently further the interests of the VA.

Scope This document outlines the overall strategy and organizational structure, defines roles and responsibilities, establishes procedures, and identifies criteria for determining the performance-based incentives earned by the Contractor, under this contract. The contract is for the delivery of healthcare services to include: medical, surgical, mental health, dental, pharmacy, ART/IVF, dialysis, durable medical devices, and skilled home health services. The delivery of healthcare services also includes provider network management, claims payment, and case management. The primary objectives of the Incentive Plan are to motivate the Contractor to provide services that exceed the contract requirements and focus Contractor's efforts in desired areas in accordance with the incentive performance objectives.

This Incentive Plan also describes contract performance measures and provides an explanation of data sources, methodology, and performance thresholds associated with applicable incentives. In consideration of time needed to implement provider networks and establish policies and procedures to manage the contract, a transition period will be required.

Performance Management Approach The PWS structures the acquisition around “what” service or quality level is required, as opposed to “how” the Contractor should perform the work (i.e., results, not compliance). This QASP will define the performance management approach taken by Community Care Contract Administration office (CCCA), and the Contracting Officer’s Representatives (CORs), to monitor and manage the Contractor’s performance to ensure the expected outcomes or performance objectives communicated, are achieved. Performance management rests on developing a capability to review and analyze information generated through performance assessment. The ability to make decisions based on the analysis of performance data is the cornerstone of performance management; this analysis yields information that indicates whether expected outcomes for the project are being achieved by the Contractor.

Performance management represents a significant shift from the more traditional quality assurance (QA) concepts in several ways. Performance management focuses on assessing whether outcomes are being achieved and to what extent. This approach migrates away from scrutiny of compliance with the processes and practices used to achieve the outcome. A performance-based approach enables the Contractor to play a large role in how the work is performed, as long as the proposed processes are within the stated constraints. The only exceptions to process reviews are those required by law (federal, state, and local) and compelling business situations, such as safety and health. A “results” focus provides the Contractor flexibility to continuously improve and innovate over the course of the contract as long as the critical outcomes expected are being achieved and/or the desired performance levels are being met.

Performance Management Strategy The Contractor is responsible for the quality of all services provided. The Contractor measures that quality through the Contractor’s own Quality Assurance (QA) program. QA is conducted on work output, not workers, and therefore includes all work performed under this contract regardless of whether the work is performed by Contractor employees or by subcontractors. The Contractor’s Quality Assurance Program (QAP) will set forth the staffing and procedures for self-inspecting the quality, timeliness, responsiveness, customer satisfaction, and other performance requirements in the PWS. The Contractor will develop and implement a performance management system with processes to assess and report its performance to the designated government representative(s). The Contractor’s QAP will set forth the staffing and procedures for self-inspecting the quality, timeliness, responsiveness, customer satisfaction, and other performance requirements in the PWS.

The government representative(s) will monitor performance and review performance reports furnished by the Contractor to determine how the Contractor is performing against communicated performance objectives. The government will make determinations regarding incentives based on performance measurement metric data and notify the Contractor of those decisions. The Contractor will be responsible for making required changes in processes and practices to ensure performance is managed effectively.

The Contractor’s performance will be assessed based on the requirements of the PWS and the QASP. The government will use the performance standards identified in Attachment B-A – QASP Performance Requirement Summary. Attachment B-A includes all performance requirements including those with incentives and disincentives. Incentive or disincentive payments will be calculated using the methodology defined in this Incentive Plan and the Incentive/Disincentive Factor summary and in Attachment B-A tabs associated with the incentives and disincentives. The Incentive Plan rewards the Contractor for increased levels of performance when performance measures identified in Section 6.0 have been met and provides for a disincentive when the performance measures are not met, where applicable. The incentive is applied through a formula which identifies a maximum allowable incentive. The specific process for determining Contractor’s performance and corresponding incentive/disincentive is set forth in sections of this plan, the QASP and in the Incentive Disincentive factor summary.

ROLES AND RESPONSIBILITIES

The Contracting Officer

The Contracting Officer (CO) is responsible for monitoring contract compliance, contract administration, and for resolving any differences between the observations documented by the VHA Community Care Operations (CCO), Community Care Contract Administration (CCCA), Contracting Officer's Representative(s) (COR), or "Program Manager (PM)" and the contractor. The CO shall ensure performance of all necessary actions for effective contracting, ensure compliance with the contract terms, and shall safeguard the interests of the United States in the contractual relationship. The CO shall also assure that the contractor receives impartial, fair, and equitable treatment under this contract. The CO will designate one full-time Regional COR as the primary government authority for performance management and additional CORs to assist the contract performance management. The number of additional representatives serving as technical inspectors depends on the complexity of the services measured, as well as the contractor’s performance, and must be identified and designated by the CO. The CO is ultimately responsible for the final determination of the adequacy of the contractor’s performance.

The Contract Specialist (CS) is responsible to act as an acquisition consultant in support of the Contracting Officer and serve as a liaison between the contracting office and the program offices; VHA CCO, CCCA, and the CORs.

2.2 Program Manager (PM)

Organization: Department of Veterans Affairs, VHA Community Care Office The Community Care Office (CCO) will assign a Program Manager with the responsibility, and relevant discretional authority to make decisions on behalf of the program which will be relayed through the CORs for action on the contract. The PM will be responsible for managing all business and technical risk of the program to ensure effective systems and services are delivered to the stakeholders on schedule, within budget and at the required levels of performance.

Contracting officer’s representative (COR) is designated in writing by the CO to act as his or her authorized representative to assist in administering this contract. COR limitations are contained in the written appointment letter. The contractor will receive a copy of all COR appointment letters. The COR is responsible for technical administration of the project and ensures proper government surveillance of the contractor’s performance. The COR is not empowered to make any contractual commitments or to authorize any contractual changes on the government’s behalf. Any changes that the contractor deems may affect contract price, terms, or conditions shall be referred to the CO for action. The COR will have the responsibility for maintaining the quality assurance file and completing QA monitoring forms used to document the inspection and evaluation of the contractor’s work performance. Government surveillance may occur under the inspection of services clause for any service relating to the contract.

Performance Evaluation The required performance standards and/or quality levels are included in the PWS and in Attachment B-A, “QASP Performance Requirements Summary.” If the Contractor meets the required service or performance level, it will be paid the monthly amount agreed in the contract. If the Contractor exceeds the service or performance level, it is eligible to receive an incentive as stated in the contract.

Failure to meet the required service or performance level will result in a deduction from the monthly amount.

Evaluation Assessment Periods The government has identified key performance objectives which will be monitored for incentive/disincentives based upon the surveillance methods below. These incentives and disincentives will be identified in the Incentive Plan that will be provided as an attachment to the contract.

The following are parameters for evaluation of the IDF criteria:

· Incentives are calculated monthly, quarterly and/or semi-annually as specified in the attached Incentive/Disincentive Factor Summary. The review board convenes monthly, quarterly or semi-annually prior to application of the incentive or disincentive to confirm the results of performance and the accuracy of the calculations. The incentive or disincentive will not apply to the base performance period under this contract.

· The incentives are objective and require continuous monitoring of performance thresholds associated with incentives. Continuous evaluation of performance will serve to advise the Contractor of trends indicating the likelihood of receiving increases or decreases of incentives during the evaluation periods.

· All evaluation periods will include calculations of the factors defined in this Incentive Plan. The purpose of the performance evaluations is to jointly assess Contractor’s performance during the period, identify strengths and improvements that occurred during the period, and recommend an appropriate incentive to be paid or subtracted from the Contractor, if justified.

· For each evaluation period, the Performance Monitor will prepare the appropriate performance and evaluation reports, documenting the Contractor’s performance and corresponding incentive rating recommendation in accordance with the performance assessment methodology set forth in the Surveillance Plan.

· Performance assessment results and supporting rationale will be reviewed, integrated, and compiled by the RB Chairperson, who will then develop and forward an overall recommendation to the FDO for use in determining incentive(s).

· The Contractor will receive the results of these recommendations along with necessary supporting material.

Performance Standards Evaluation Methods Surveillance Techniques In an effort to minimize the performance management burden, simplified surveillance methods shall be used by the government to evaluate Contractor performance when appropriate. The primary methods of surveillance are:

· Random sampling, which shall be performed by the COR designated inspector.

· 100% Inspection - Each month, the COR, shall review the generated documentation and enter summary results into the Surveillance Activity Checklist.

· Periodic Inspection – COR typically performs the periodic inspection on a monthly basis.

· Audits – typically performed by internal and external organization to the VA under the direction of the CO/COR Customer Feedback The Contractor is expected to establish and maintain professional communication between its employees and customers. The primary objective of this communication is customer satisfaction. Customer satisfaction is the most significant external indicator of the success and effectiveness of all services provided and can be measured through customer complaints.

Performance management drives the Contractor to be customer focused through initially and internally addressing customer complaints and investigating the issues and/or problems, but the customer always has the option to communicate complaints to the CO as opposed to the Contractor.

Customer feedback may also be obtained either from the results of formal customer satisfaction surveys or from random customer complaints.

Acceptable Quality Levels The Acceptable Quality Levels (AQLs) included in Attachment B-A, Performance Requirements Summary Table, for Contractor performance are structured to allow the Contractor to manage how the work is performed while providing disincentives for performance shortfalls.

The following actions will be taken to ensure the AQLs are accurate and timely:

· No later than 20 days prior to the end of the evaluation period, the Incentive Recorder will establish a schedule for each required evaluation process step and notify the Performance Monitor, and RB Members of the upcoming incentive process requirements.

· Performance Monitors will submit performance assessments of each performance objective in Section 6.0.

· The Incentive Recorder will compile an evaluation report, including the recommended incentive, for review by the Performance Monitor. The Performance Monitor’s assessment briefing is based on the evaluation report and will be prepared for review five days after the close of the evaluation periods.

· No later than 10 days after the evaluation period ends, the Performance Monitor will present the assessment briefing to the RB.

· The Incentive Recorder will record RB discussions and deliberations in detailed minutes. These minutes, when combined with the briefings, will provide a clear and concise record of the events leading to the FDO decision. The minutes and briefings comprise the official file which provides the necessary support to substantiate the incentive decision. The incentive assessments and recommendations proposed to the FDO will be submitted to the CO. The CO will submit the assessments to the Contractor within 15 days after the evaluation(s) of that period. The Contractor must submit its concurrence or any relevant disputes to the CO within five days of receipt of the assessment and recommendation.

· No more than 25 days after the evaluation(s) of that period, the RB Chairperson will present the Government’s assessment and recommendation to the FDO and CO. Upon request, the Contractor shall be given an opportunity to present additional pertinent information concerning the recommended decision to the FDO and CO.

· The FDO makes the final determination and awards the appropriate incentive/disincentive amount no later than 30 days after the evaluation(s) of that period. The FDO through the CO will notify the Contractor in writing of the incentive earned or lost and will provide an evaluation of the Contractor's performance in accordance with Section 6.0.

· The FDO will authorize the CO to award the determined incentive payment or initiate the collection of the determined disincentive(s). The CO will issue a task order for the initial performance period for which an incentive is earned to record obligations and incentive payments. The CO will issue a unilateral task order modification for the payment of incentives to the Contractor within 15 business days after receiving authorization from the FDO. The goal is to have the incentive payment to the Contractor within 45 days from the end of the period.

· The CO may discuss with Contractor, the decision of the FDO. However, the determination is a unilateral decision made solely at the discretion of the Government. This decision is not subject to the Disputes clause of the contract.

· The Contractor must have at least good performance on all other aspects of the contract that are not related to the Incentive Plan to be eligible for any incentive payments.

Overview of Incentive/Disincentive Factors Structure The incentives are structured around operations after the Community Care Network (CCN) Region 5 is fully implemented; therefore, the incentive/disincentive will apply to the Option period under this contract; the Contractor is eligible to earn incentives or subject to disincentives starting in the Option period. A detailed definition of the metrics, how each is computed, and the full range of incentives is defined in the Incentive Disincentive Factor Summary, Quality Assurance Surveillance Plan (QASP) and this Incentive Plan.

The Contractor shall not be eligible for an incentive unless all performance requirements listed within the QASP have a good rating (or better) or achieve the minimum stated threshold or higher. Disincentives on individual factors will apply regardless of the performance on any other requirements.

The monetary incentive applies to the Incentive/ Disincentive Factors (IDFs) 1 through 6 listed in Table 1 below:

Table 1. CCN Incentive/Disincentive Factors (IDFs)

Incentive/Disincentive Review Board The Incentive/Disincentive Review Board (RB) will consist of a representative from each Alaska VA Facility, a senior representative from the Office of Community Care (OCC), a senior program manager supporting the Community Care Contract Administration, and the Contracting Officer’s Representative (COR). Additional advisors will be included, as needed, from the Office of Procurement Acquisition Logistics Strategic Acquisition Center (SAC), Office of General Counsel, Office of Community Care, and the Office of the Assistant Deputy Under Secretary for Operations and Management.

The incentive organization consists of the Fee Determining Official (FDO), Contracting Officer (CO), Review Board (RB), RB Chairperson, RB Advisory Members, Incentive Recorder, and Performance Monitors.

Roles and Responsibilities Table 2 demonstrates the roles, appointed personnel, and responsibilities of the Incentive/Disincentive Review Board (RB):

Table 2. CCN RB and FDO Positions and Responsibilities

Contracting Officer (CO)

Contracting Specialist (CS)

The Contract Specialist (CS) is responsible to act as an acquisition consultant in support of the Contracting Officer and serve as a liaison between the contracting office and the program offices; VHA CCO, CCCA, and the CORs.

Program Manager (PM)

Community Care Office (CCO) will assign a Program Manager with the responsibility, and relevant discretional authority to make decisions on behalf of the program which will be relayed through the CORs for action on the contract. The PM will be responsible for managing all business and technical risks of the program to ensure effective systems and services are delivered to the stakeholders on schedule, within budget and at the required levels of performance.

Contracting officer’s representative (COR) is designated in writing by the CO to act as his or her authorized representative to assist in administering this contract. COR limitations are contained in the written appointment letter. The Contractor will receive a copy of all COR appointment letters. The COR is responsible for technical administration of the project and ensures proper government surveillance of the Contractor’s performance. The COR is not empowered to make any contractual commitments or to authorize any contractual changes on the government’s behalf. Any changes that the Contractor deems may affect contract price, terms, or conditions shall be referred to the CO for action. The COR will have the responsibility for maintaining the quality assurance file and completing QA monitoring forms used to document the inspection and evaluation of the Contractor’s work performance. Government surveillance may occur under the inspection of services clause for any service relating to the contract.

Fee Determining Official (FDO)

The FDO (at least one level above the CO) will: (1) Appoint the Review Board Chairperson. (2) Approve the Incentive Plan. (3) Approve changes to the Incentive Plan, and/or associated Incentive criteria or methodology of determining amount(s) of Incentive. (4) Make the final decision on whether or not an incentive or disincentive applies and if so, the amount.

Review Board (RB) Chairperson

The RB Chairperson will: (1) Manage all activities of the RB. (2) Appoint an Incentive Recorder. (3) Recommend Incentive Plan changes to the FDO. (4) Present the RB's written evaluation and recommendation to the FDO and CO.

Review Board Advisory Members

RB Advisory Members are selected as appropriate to provide customer input and subject matter expertise to other RB members. Advisory Members may include but are not limited to individuals from: the Office of Finance, Office of General Counsel, Chief Business Office, and the Office of the Assistant Deputy Under Secretary for Operations and Management.

Review Board Members

The RB Members will: (1) Review performance reports. (2) Participate in the RB meetings and briefings upon request of the RB Chairperson. (3) Review performance assessments and prepare a written evaluation and recommendation. (4) Recommend changes to the Incentive Plan. (5) Maintain written records of Contractor’s performance.

Incentive Recorder

The Incentive Recorder will: (1) Manage all activities associated with the RB process. (2) Consolidate assessments and recommendations for presentation to the RB and FDO during the performance evaluation period. (3) Notify RB members of when and what required reports/briefings are due. (4) Record and distribute minutes of the RB meetings. (5) Maintain and update the Incentive Plan as approved by the FDO. (6) Maintain the official Incentive files to include internal procedures and other documentation having a bearing on the FDO's decision. (7) Provide Incentive overview and training for new team members when training is needed. (8) Document and maintain RB activities in official files. (9) Perform other duties as assigned by the RB Chairperson, or CO including notification and scheduling of any advisory personnel that may be needed by the RB.

Performance Monitor, Contracting Officer’s Representative (COR)

The Performance Monitor/COR will: (1) Understand and be familiar with the contract requirements, the Incentive Plan, and the QASP. (2) Conduct assessments according to contract requirements and the QASP. (3) Maintain written records of Contractor's performance, “performance report” which includes a complete listing of all performance objectives, the required performance threshold, and the Contractor’s results for the performance objectives on a monthly, quarterly or semi-annual basis. (4) Review and coordinate evaluation reports prepared by Incentive Recorder, for each period based on the processes outlined in the (Program) Surveillance Plan for their Incentive areas of evaluation. (5) Provide briefings and/or required reports to the Incentive Recorder in preparation for performance evaluations and incentive determination. (6) Understand and monitor Contractor’s performance levels and the performance requirements necessary to achieve each level of performance as defined in the QASP. (7) Be prepared to brief the RB on the completed performance assessment. (8) Recommend changes to the Incentive Plan; e.g., incentive pool reallocations, and criteria for weighting of performance areas, through the Incentive Recorder. (9) Maintain open, honest, and frequent communications between RB members. (10) Responsible for certifying invoices for incentive payments and applying deductions to invoices when disincentives are approved.

IDF Evaluation Methodology The determination of the incentive is based on individual logic of each incentive/disincentive factor prescribed in the Incentive/Disincentive Factor (IDF) Summary. The weighted success formulas are shown in succession from Section 5.1 to Section 5.6.

Incentive/Disincentive Factor 1 (IDF1) IDF1, High Performing Network, will result in a cumulative percentage of all institutional providers, group providers, and individual providers that meet the high performing designations as determined in the CCN Health Care Services Network Quality and Performance Criteria Thresholds agreed to by VA, each being weighted equally as in the following calculation:

Percentage of institutional providers with high performing designation (success / opportunities) * 33.3% + percentage of group providers with high performing designation (success / opportunities) * 33.3% + percentage of individual providers with high performing designation (success / opportunities) * 33.3% = weighted percent success of network providers meeting the high performing designation When the Contractor achieves a performance equal to or greater than 15.0%, a 2% increase to their cumulative Per Member Per Month (PMPM) will be assessed. When the Contractor achieves a performance greater than or equal to 12.0% and less than 15.0%, a 1% increase to their cumulative PMPM will be assessed.

When the Contractor performance is less than 12.0%, no incentive will be assessed.

Payments will be made semi-annually and calculated using the cumulative PMPM to include Healthcare, Dental, and Pharmacy administrative service fees for the applicable period of performance being assessed.

Incentive/Disincentive Factor 2 (IDF2) IDF2, Network Usage will result in a percentage of claims that are paid to network providers versus non-network providers for referrals submitted to the Contractor in accordance with the following calculation:

Total number of claims with VA approved referral numbers paid to network providers in a given month divided by total number of healthcare service claims submitted by the Contractor and non-network providers providing services through the contract referral that are submitted directly to VA = percentage use of network providers.

When the Contractor achieves a performance greater than or equal to 92.0% of claims paid to network providers, a 2.0% increase to their PMPM will be assessed. When performance is greater than or equal to 90.0% and less than 92.0%, no incentive will be assessed. When the Contractor performance is less than 90.0%, a 2.0% deduction will be assessed as a reimbursement to the VA.

Payment will be monthly, when applicable, and will be calculated as a percentage of the cumulative PMPM to include Healthcare, Dental, and Pharmacy administrative service fees for the applicable period of performance being assessed. Reimbursements must be made monthly, when applicable. VA will require reimbursement or apply deductions to other invoices received to apply the disincentive. The total reimbursement will be 2.0% of the total value of non-network provider claims with VA Approved Contractor referrals paid that month when performance falls below 90%.

Incentive/Disincentive Factor 3 (IDF3) IDF3, Maintain Network Adequacy, will result in a percentage of fulfillment to assess an adequate network to meet VA’s referral needs and geographical needs for the network. The QASP Performance Objectives (POs) that are identified in the calculation below are for the following network adequacy areas: PO1 Region 5: Alaska Assessment of Health Care Network; PO2 is for Complementary and Integrative Health Services Network; PO3 Region 5: Alaska Assessment of Dental Network; PO4 is for Urgent/Emergent Prescription Network. Each PO 1-4 will be assessed quarterly, and each quarter will have equal weight when an incentive determination is made semi-annually.

QASP Performance Objectives 1-4:

QASP PO1 (PO1 quarterly %*12.5% + PO1 quarterly %*12.5%) = PO1 Semi-annual percentage + QASP PO2 (PO2 quarterly %*12.5% + PO2 quarterly %*12.5%) =PO2 Semi-annual percentage + QASP PO3 (PO3 quarterly %*12.5% + PO3 quarterly %*12.5%) = PO3 Semi-annual percentage + QASP PO4 (PO4 quarterly %*12.5% + PO4 quarterly %*12.5%) = PO4 Semi-annual percentage = Weighted percent network fulfillment.

When performance is greater than or equal to 97.0%, a 2.0% increase of the cumulative PMPM will be assessed. When performance is greater than or equal to 95.0% and less than 97.0%, a 1.0% increase of the cumulative PMPM will be assessed. When performance is greater than or equal to 90.0% and less than 95.0%, no incentive or disincentive will be assessed. When performance is greater than or equal to 87.0% and less than 90.0%, a 2.0% deduction of the cumulative PMPM will be assessed and reimbursed to the VA. When performance is less than 87.0%, a 4.0% deduction of the cumulative PMPM will be assessed as a reimbursement to the VA.

Payment will be semi-annually, when applicable, and will be calculated as a percentage of the cumulative PMPM to include Healthcare, Dental, and Pharmacy administrative service fees for the applicable period of performance being assessed. Reimbursements must be made semi-annually, when applicable. VA will require reimbursement or apply deductions to other invoices received to apply the disincentive. The total reimbursement will be either 2.0% or 4.0% of the cumulative PMPM to include Healthcare, Dental, and Pharmacy administrative service fees for the applicable period of performance being assessed, as determined by FDO.

Incentive/Disincentive Factor 4 (IDF4) IDF4, Claims Submission Accuracy, will result in a total percentage of clean claims from the providers to the Contractor. The total number of clean claims will be calculated by taking the number of provider claims processed on the first pass (success) divided by the total number of provider claims (opportunities) the Contractor receives in a 180-day period.

Number of clean claims received / total number of claims received (success / opportunities) When the Contractor receives 90.0% or more clean claims, a 1.0% increase of the cumulative PMPM will be assessed. When performance is less than 90.0%, no incentive will be assessed.

Payment will be semi-annually, when applicable, and will be calculated as 1.0% of the cumulative PMPM to include Healthcare, Dental, and Pharmacy administrative service fees for the applicable period of performance being assessed.

Incentive/Disincentive Factor 5 (IDF5) IDF5, Improper Payments and Elimination Recovery Act (IPERA) Adjudication and Payment Rules, will result in a percentage of the universe of healthcare claims submitted which accurately conform to the contracted rates. This will be calculated by using an independent third-party auditor who will audit quarterly to determine accuracy of payments to reduce improper payments. The auditor will provide VA and the contractor the quarterly statistical projection of improper payment and accuracy of payments. These Performance thresholds will be negotiated on an annual basis to allow for continuous improvement on the reduction of improper payments.

When performance is greater than or equal to 97.0% a 2% increase to the cumulative PMPM will be assessed. When performance is greater than or equal to 96.0% and less than 97.0%, a 1% increase to the cumulative PMPM will be assessed. When performance is greater than or equal to 95.0% and less than 96.0%, no incentive or disincentive will be assessed. When performance is greater than or equal to 94.0% and less than or equal to 95.0%, a 2% deduction to the cumulative PMPM will be assessed. When performance is equal to or less than 94.0%, 4% deduction to the cumulative PMPM will be assessed.

Payment will be quarterly, when applicable, and will be calculated as a percentage of the cumulative PMPM to include Healthcare, Dental, and Pharmacy administrative service fees for the applicable period of performance being assessed. Reimbursements must be made quarterly, when applicable. VA will require reimbursement or apply deductions to other invoices received to apply the disincentive. The total reimbursement will be either 2.0% or 4.0% of the cumulative PMPM to include Healthcare, Dental, and Pharmacy administrative fees for the applicable period of performance being assessed, as determined by FDO.

Incentive/Disincentive Factor 6 (IDF6) IDF6, Urgent/Emergent Prescription Fills, will result in a percentage of conformance to the VA National Formulary and generic drug utilization by the CCN providers VA has the ability to remove the VA providers from these calculations based on Drug Enforcement Agency (DEA) license numbers. The QASP POs that are identified in the calculation below are for the following pharmacy requirements: PO5 is for overall conformance with VA Urgent/Emergent Formulary by CCN providers, and PO6 is for overall conformance with generic drug dispensing for VA Urgent/Emergent prescriptions by CCN providers. Each PO will be assessed on a quarterly basis and each PO will have equal weight when an incentive determination is made quarterly.

QASP Performance objectives PO5/PO6:

QASP PO5 Quarterly assessment (success/opportunities) *50% + QASP PO6 Quarterly assessment (success/opportunities) *50% = Weighted percent success When performance is greater than or equal to 97.5% of urgent/emergent and generic prescriptions, a 3% increase to the cumulative PMPM will be assessed. When performance is greater than or equal to 96.0% and less than 97.5%, a 1% increase to the cumulative PMPM will be assessed. When performance is greater than or equal to 95.0% and less than 96.0%, no incentive or disincentive will be assessed. When performance is greater than or equal to 90.0% and less than 95.0%, a 1% deduction of the cumulative PMPM will be assessed and reimbursed to the VA. When performance is less than 90.0%, a 3% deduction of the cumulative PMPM will be assessed and reimbursed to the VA.

Payment will be quarterly, when applicable, and will be calculated as a percentage of the cumulative PMPM for Pharmacy administrative service fees for the applicable period of performance being assessed. Reimbursements must be made quarterly, when applicable. VA will require reimbursement or apply deductions to other invoices received to apply the disincentive. The total reimbursement will be either 1.0% or 3.0% of the cumulative PMPM for Pharmacy administrative service fees for the applicable period of performance being assessed, as determined by FDO.

Incentive/Disincentive Annual Calculated Value The incentives and disincentives are calculated according to the Incentive /Disincentive Factor Summary. Each factor is calculated based on their specific frequency requirement of monthly, quarterly or semi-annually.

The incentive price ceilings for each IDF is the maximum incentive than can be earned. Table 3 reflects the estimated maximum value for Region 5: Alaska, for the Option Period.

Table 3. Region 5, Incentives/Disincentives Estimated Maximum Annual Values

Please note: the above maximum incentive and disincentive values are estimates. The actual maximum incentives and disincentives will be based on the final contract value for PMPM and active Veteran volume.

Ensuring IDF Performance Quality Assurance Documentation Quality Assurance (QA) surveillance should be continually conducted throughout the contract, with open communication between the Contractor, RB and FDO. Certain factors help facilitate this surveillance:

The Performance Management Feedback Loop: The performance management feedback loop begins with the communication of expected outcomes. Performance standards are expressed in the PWS and will be assessed using the performance monitoring techniques shown in Attachment BA.

Monitoring Forms: The government’s QA surveillance, accomplished by the CORs and PMs, will be reported using the monitoring forms in attachment below. The forms, when completed, will document the government’s assessment of the Contractor’s performance under the contract to ensure that the required results performance levels are being achieved.

The CO, COR(s) and PMs will retain a copy of all completed QA surveillance forms. Appendix A contains an example of Sample Quality Assurance Monitoring Form.

Determining Performance The Government shall use the evaluation methods cited (Section 4) to determine whether the performance standards/service levels/AQLs have been met. If the Contractor has not met the minimum requirements, it may be asked to develop a corrective action plan to show how and by what date it intends to bring performance up to the required levels. Failure to meet the AQL may result in disincentives or equitable adjustments being applied. Likewise, if the Contractor exceeds the performance standards, an incentive may be paid, in accordance with the incentive plan included in the contract.

Reporting Results At the end of each quarter, the PM will prepare a written report for the VHA Community Care Office summarizing the overall results of the quality assurance surveillance of the Contractor’s performance. This written report, which will include the Contractor’s monthly and quarterly reports and the completed quality assurance monitoring forms (attachment below), will become part of the QA documentation. It will enable the government to demonstrate whether the Contractor is meeting the stated objectives and/or performance standards, including cost/technical/scheduling objectives.

Reviews and Resolution The CO and PM will require the Contractor to meet with the Community Care Office and other government personnel during the quarterly Program Management Review (PMR) and monthly if deemed necessary to discuss performance evaluation. The CO and PM will define a frequency of in-depth reviews with the Contractor, including appropriate self-assessments by the Contractor; however, if the need arises, the Contractor will meet with the CO and PM as often as required or per the Contractor’s request. The agenda of the reviews may include:

· Monthly performance assessment data and trend analysis and Monthly Progress Reports (MPRs)

· Quarterly Progress Report (QPR) and PMR agenda

· Corrective Action Plan (CAP)

· Issues and concerns of both parties

· Projected outlook for upcoming months and progress Recommendations for improved efficiency and/or effectiveness

· Additional performance or programmatic concerns The CO, PM and COR must coordinate and communicate with the Contractor to resolve issues and concerns regarding performance that falls below the CCN Acceptable Quality Level (AQL) standards listed in Attachment B-A - QASP Performance Requirements Summary.

The CO, COR and PM and Contractor should jointly formulate tactical and long-term courses of action. Decisions regarding changes to metrics, thresholds, or service levels should be clearly documented. Changes to service levels, procedures, and metrics will be incorporated as a contract modification.

Changes And/Or Modifications to the QASP and Incentive Plan The Government reserves the right to unilaterally change the incentive evaluation methodology, areas of emphasis and/or their respective weighting, period of evaluation, individual metrics, and other matters covered in this plan. Any changes to the individual metrics will ensure the responsibility for performance remains within the Contractor’s scope of control. Any changes to this plan that affect disincentive payments will be subject to agreement between the parties and accomplished by means of a bilateral modification. The bilateral modification will take effect on the date the modification is issued unless stated otherwise.

Proposing Changes Either the Government or (Contractor) may propose changes to the QASP and Incentive Plan prior to the next incentive evaluation period. Proposed changes must be submitted to the Contracting Officer and should be made in time to allow for review, comment, and modification of the contract, if appropriate.

Method for Making Changes Proposed changes will be submitted to the CO. Recommended changes to the QASP and Incentive Plan will be coordinated by the Performance Monitor and presented to the RB for coordination/approval. Changes will be submitted to the FDO for approval. The FDO will review and approve all changes to the Incentive Plan before any changes take effect. The CO will execute modifications as appropriate.

Sample Quality Assurance Monitoring Form

SAMPLE QUALITY ASSURANCE

MONITORING FORM

PERFORMANCE OBJECTIVE, SERVICE or STANDARD:

SURVEY PERIOD:

SURVEILLANCE METHOD (Check):

Random Sampling 100% Inspection Periodic Inspection Customer Complaint LEVEL OF SURVEILLANCE (Check):

ANALYSIS OF RESULTS:

Observed Service Provider Performance Measurement Rate: ______%

Narrative of Performance During Survey Period:

PREPARED BY: ___________________________________ DATE: ________________

Acronym List

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