VA Health Care:

Opportunities for Service Delivery Efficiencies Within Existing Resources

HEHS-96-121: Published: Jul 25, 1996. Publicly Released: Jul 25, 1996.

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Pursuant to a congressional request, GAO provided information on the Department of Veterans Affairs' (VA) health care system, focusing on ways that VA could: (1) operate more efficiently; (2) reduce the resources needed to meet veterans' health care needs; and (3) reorganize its health care system and create efficiency incentives.

GAO found that: (1) the VA health care system should be able to respond to deficit reduction within the next seven years; (2) VA has overstated the level of resources that it would need to satisfy veterans health care requirements in the next seven to ten years; (3) VA did not adequately consider the impact of the declining veteran population on the future demand for inpatient hospital care; (4) a significant portion of VA resources is used to provide services to veterans in the discretionary care category; (5) VA could significantly reduce its operating costs over the next seven years by completing actions on a wide range of efficiency improvements; (6) the success of these efforts depends on how VA health care facilities spend appropriated funds; (7) VA managers often find ways to operate more efficiently when they need resources to implement new services or expand existing services; (8) VA is holding network directors accountable for the Veterans Integrated Service Network's (VISN) performance; (9) the Under Secretary for Health distributed criteria to help VISN directors develop efficiency initiatives and gave VISN and facility directors authority to realign VA medical centers to achieve efficiencies; (10) VA plans to develop a capitation funding process that provides greater efficiency incentives for VA facilities; and (11) VA must implement clear mechanisms and verify management data to achieve its workload, efficiency, and other performance targets.

Recommendations for Executive Action

  1. Status: Closed - Implemented

    Comments: VA's networks have established preadmission certification programs. These programs, however, do not involve contracts with independent external reviewers or any financial risk/incentives for VA physicians to adhere to the review findings.

    Recommendation: The Secretary of Veterans Affairs should establish an independent, external preadmission certification program for VA hospitals.

    Agency Affected: Department of Veterans Affairs

  2. Status: Closed - Not Implemented

    Comments: Under its new legislatively mandated eligibility process, medical services are mandatory for about 89 percent of all veterans using VA's healthcare system. As such, it no longer seems useful for VA to provide data on mandatory and discretionary care.

    Recommendation: The Secretary of Veterans Affairs should provide Congress, through future budget submissions, data on the extent to which VA services were provided to veterans in the mandatory and discretionary care categories for both inpatient and outpatient care.

    Agency Affected: Department of Veterans Affairs

  3. Status: Closed - Not Implemented

    Comments: VA disagreed with the recommendation and has no plans to track savings from efficiency initiatives. VA believes that accountability will be secured through other monitoring processes, including the Government Performance and Results Act.

    Recommendation: The Secretary of Veterans Affairs should include in future budget submissions: (1) information on costs saved through improved efficiency; and (2) plans to either reinvest savings in new services or programs or use the savings to reduce the budget request.

    Agency Affected: Department of Veterans Affairs


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