Technical Report 45: Mapping A Crosswalk of DoD and VA Inpatient and Outpatient Health Services Utilization Codes with HERC Patient Care Categories
Suggested CitationEsmaeili A, Dismuke-Greer CE. Mapping A Crosswalk of DoD and VA Inpatient and Outpatient Health Services Utilization Codes with HERC Patient Care Categories. Technical Report 45. Health Economics Resource Center, VA Palo Alto Health Care System, U.S. Department of Veterans Affairs. April 2025.
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Highlights
- We mapped a crosswalk between VA and Department of Defense (DoD) inpatient and outpatient care data using the HERC categories of care.
- Crosswalks between VA and DoD health care data can ensure continuity and coherence in the care of individuals who transition between DoD and VA health systems.
- Creating a unified framework enables data users to compare service utilization and associated costs between systems, ultimately improving decision-making and policy development.
1. Introduction
One of the Health Economics Resource Center's (HERC's) goals is to develop a set of Veterans Health Administration (VA) Inpatient and Outpatient costs for budget impact or cost-effectiveness analysis. HERC assumes that every health care encounter has the average cost of all encounters with the same characteristics.(1) Therefore, HERC created "patient care categories" for inpatient and outpatient settings, representing a group of related cost accounts and their associated utilization (Tables 1 and 2).(1, 2)
1.1. HERC inpatient and outpatient category of care
In the inpatient setting, corresponding to the location where care is delivered, VA and HERC used the "bedsection" to categorize the type of clinical care provided during an overnight stay.(1, 3-5) HERC defined eleven patient care categories based on the bed sections that helped researchers monitor healthcare expenditures in their research. Table 1 shows these categories include Medicine, Rehabilitation, Blind Rehabilitation, Spinal Cord, Surgery, Psychiatry, Substance Abuse, Intermediate Medicine, Domiciliary, Long Term/Nursing Home, and Psychosocial residential rehabilitation treatment programs (PRRTP).
Similarly, VA and HERC used "clinic stop codes" to characterize the outpatient clinical services.(2, 3, 6) The clinic stop codes correctly identify and capture clinical workload. Table 2 shows these categories: Medicine, Dialysis, Ancillary Services, Rehabilitation, Diagnostics Services, Pharmacy, Prosthetics, Surgery, Psychiatry, Substance Abuse Treatment, Dental, Adult Daycare, Home Care, Contract Extended Care, Other Contract Care, and Unidentified Stops.
1.2. Medical Expense and Performance Reporting System (MEPRS) for Fixed Military Medical and Dental Treatment Facilities (DTFs)
DoD and the Defense Health Agency provided a uniform and standardized healthcare managerial cost accounting system for the Military Health System (MHS).(7) Functional Cost Code (FCC) is a standard cost accounting element that uniformly labels a work/cost center in the DoD MHS with a four-digit alphanumeric code. All workload, expense, and full-time equivalent (FTE) data reported in Medical Expense and Performance Reporting System (MEPRS) must be aligned to an FCC. An FCC shows aggregated workload, expenses, and/or FTEs at the functional category (first level), summary account (second level), and sub-account (third level). The fourth-level FCC's purpose is not to track a type of workload or program. The fourth-level FCC is provided to enhance the FCC account structure's utility and flexibility and support accurate cost allocation and accounting for each fixed Military Treatment Facility (MTF)/Defense Treatment Facility (DTF). FCC Categories included: A - Inpatient Care, B - Outpatient Care, C - Dental Care, D - Ancillary Services, E - Support Services, F - Special Programs, and G – Readiness.(7)
1.3 The purpose of crosswalking between MEPRS and the HERC category of care
Crosswalks between the Defense Health Agency's MEPRS codes (used for health care cost accounting) and VA's clinic stop codes/bedsections are essential for ensuring continuity and coherence in the care of individuals who transition between DoD and VA. These individuals often receive care in both systems and aligning service categories enables better tracking of their clinical services across institutions, supporting seamless continuation of care. From a financial perspective, such crosswalks allow for consistently monitoring health care budgets across agencies, ensuring resources are allocated efficiently. Furthermore, they facilitate budget impact analyses and cost-effectiveness research by creating a unified framework for comparing service utilization and associated costs, ultimately improving decision-making and policy development for both DoD and VA.
2. Methods
For our methodology, we followed established guidelines to ensure accurate and meaningful crosswalks between the DoD and VA systems.(1, 2, 7) Specifically, we used the HERC guidelines for VA inpatient and outpatient average cost data and the procedures manual the Defense Health Agency provided for interpreting and categorizing MEPRS codes. We manually mapped MEPRS codes to VA clinic stop and bedsection codes by carefully reviewing the code descriptions and applying clinical logic to determine equivalency or alignment across systems. To support this process, we used the VA Corporate Data Warehouse (CDW) via the VINCI environment to extract detailed descriptions of VA stop codes, enabling a more precise and clinically relevant mapping.
3. Results
Table 1 (inpatient categories of care) and Table 2 (outpatient categories of care) summarize the mapping between DoD MEPRS and VA clinic stop codes/bed sections to create a crosswalk based on established HERC care categories. In the inpatient setting, we provided equivalent DoD MEPRS codes for the VA clinic stop codes related to the HERC care categories of acute medicine, rehabilitation, surgery, psychiatry, and substance abuse. However, we did not observe equivalent MEPRS codes for the bed sections related to the HERC categories of care for blind rehabilitation, spinal cord injury, intermediate medicine, domiciliary, nursing home, or PRRTP (Psychosocial Residential Rehabilitation Treatment Program).
In the outpatient setting, we provided equivalent DoD MEPRS codes for the VA clinic stop codes related to the HERC care categories of medicine, dialysis, ancillary services, rehabilitation, diagnostics services, surgery, psychiatry, substance abuse treatment, and dental services. We did not observe equivalent DoD MEPRS codes for the VA clinic stop codes related to the HERC care categories for prosthetics, adult daycare, home care, contract extended care, and other contract care.
We also found that the DoD FCC codes related to support services (E), special programs (F), and Readiness (G) are unique to the DoD healthcare system (we did not observe similar services in VA). The DoD MEPRS codes related to inpatient substance abuse (AFB) are provided in both substance abuse and rehabilitation centers. VA offers comprehensive rehabilitative services in both rehabilitation and domiciliary centers.
*Stations with an approved PRRTP program: 459 463 501 504 515 516 518 523 528 541 546 549 554 555 556 561 568 573 586 589 590 595 598 620 622 631 632 635 637 640 645 653 656 658 662 663 666 676 678 687 689
*Clinic stops 290-297 are not included because they are observation codes.
4. Discussion
Crosswalks between most direct medical care services are generally feasible between the Military Health System's MEPRS codes and the VA’s inpatient bed sections or outpatient clinic stop codes. Through careful review of code descriptions and clinical logic, many direct clinical encounters, such as primary care, specialty care, mental health services, and inpatient hospitalizations, can be appropriately matched to corresponding categories in the HERC care classification system. This enables researchers and policymakers to make meaningful comparisons in utilization and costs across the Department of Defense (DoD) and VA systems, especially for conditions with high prevalence among service members and Veterans, such as musculoskeletal injuries, PTSD, and chronic diseases.
However, it is crucial to account for the distinct missions and objectives of the DoD and VA when aggregating healthcare costs across the systems. The DoD's health care services are closely tied to operational readiness and force health protection, while the VA primarily focuses on Veterans' long-term care and health outcomes. As such, cost estimates derived from combining data across the two systems may not always reflect true equivalency. For example, a similar outpatient visit may have different associated costs or resource use depending on the setting and purpose, necessitating caution in comparative analyses and policy decisions.
Beyond direct clinical services, the DoD also provides support services, special programs, and readiness-related care without direct counterparts in VA. Examples include pre-deployment health assessments, medical readiness screenings, and services tied to operational medicine such as field medical training or embedded unit support. Additionally, certain types of services, like prosthetic fitting and support, may be delivered through internal processes and not directly billed in the DoD system, making them difficult to map or cost-equivalent to VA's well-documented prosthetics and durable medical equipment services.
In contrast, VA delivers broader services for long-term management, rehabilitation, and reintegration into civilian life. These include home-based primary care, community living centers (VA's version of nursing homes), supported employment programs for Veterans with mental health conditions, and comprehensive rehabilitation programs for polytrauma and spinal cord injury. These extended care services are less common in the DoD, as service members with chronic care needs are typically transitioned out of active duty. This difference underscores the broader scope of care in VA, especially for aging or medically complex Veterans.
In conclusion, while meaningful crosswalks between DoD MEPRS and VA clinic stop codes can be constructed for most direct medical services, differences in system goals, service types, and cost structures must be carefully considered. Harmonizing data across the DoD and VA enables improved research and policy evaluation, particularly around continuity of care and resource allocation. However, analysts must remain cautious when interpreting aggregated cost data, especially where non-equivalent or system-specific services are involved. A nuanced understanding of each system's structure and mission is critical for drawing accurate and actionable insights.
References
- Wagner T, Chow A, Su P, Barnett PG. HERC's Average Cost Datasets for VA Inpatient Care. Health Economics Resource Center, VA Palo Alto Health Care System, U.S. Department of Veterans Affairs. May 2018.
- Phibbs CS, Scott WJ, Flores NE, Barnett PG. HERC's Outpatient Average Cost Datasets for VA Care. Health Economics Resource Center, VA Palo Alto Health Care System, U.S. Department of Veterans Affairs. May 2023.
- VHA Handbook 1006.2, VHA SITE CLASSIFICATIONS AND DEFINITIONS, https://www.va.gov/vhapublications/publications.cfm?Pub=2. NOTE: This is an internal VA Web site and is not accessible to the public.
- VHA Handbook 1000.01, INPATIENT BED CHANGE PROGRAM AND PROCEDURES, https://www.va.gov/vhapublications/publications.cfm?Pub=2. NOTE: This is an internal VA Web site and is not accessible to the public.
- Wagner T, Lo J. HERC's MCA Discharge Dataset with Subtotals for Inpatient Categories of Care. Health Economics Resource Center, VA Palo Alto Health Care System, U.S. Department of Veterans Affairs. September 2018.
- Financial Documents Chapter 03 – Managerial Cost Accounting; https://department.va.gov/financial-policy-documents/financial-document/chapter-03-managerial-cost-accounting/ Volume XIII - Cost Accounting. Date Approved: April 18, 2024.
- Defense Health Agency, PROCEDURES MANUAL; Medical Expense and Performance Reporting System (MEPRS) for Fixed Military Medical and Dental Treatment Facilities (DTFs): Business Rules. https://health.mil/-/media/Files/MHS/Policy-Files/SIGNED--DHAPM-601013-MEPRS-Volume-1.ashx NUMBER 6010.13 Volume 1. September 27, 2018.
