VA Health Care:

Better Data Needed to Effectively Use Limited Nursing Home Resources

HEHS-97-27: Published: Dec 20, 1996. Publicly Released: Dec 20, 1996.

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Stephen P. Backhus
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Pursuant to a congressional request, GAO provided information on the Department of Veterans Affairs' (VA) nursing home programs, focusing on: (1) the distribution of veterans in VA, community, and state veterans nursing homes; (2) the costs to VA for VA, community, and state veterans nursing homes; (3) the factors affecting VA's use of community and state veterans nursing homes; and (4) whether VA, community, and state veterans homes provide comparable quality care.

GAO found that: (1) the number of veterans receiving VA-financed or -provided nursing home care increased from 72,889 in 1985 to 79,373 in 1995, though the costs of these services increased from about $710 million to $1.6 billion in the same period; (2) among veterans currently receiving VA-financed or -provided nursing home care, 40 percent receive such care in VA nursing homes, 36 percent in state veterans nursing homes, and 24 percent in community nursing homes; (3) VA records for fiscal year 1995 indicate that VA's daily per patient cost was $213.17 for veterans in VA nursing homes, $118.12 for veterans in community nursing homes, and $35.37 for veterans in state veterans homes; (4) some of the cost differences are attributable to differing patient mix and staffing patterns among the facility types, but the precise cost differences cannot be determined because of weaknesses in VA's cost data; (5) several factors influence VA decisions on where to place nursing home patients; (6) VA's use of state veterans homes is limited by the number of such beds available and by some states' criteria for admitting veterans to these homes; (7) the VA nursing homes GAO visited appeared to provide more comprehensive care to veterans than most of the community and state veterans nursing homes GAO visited; (8) although the care provided in the community and state homes GAO visited generally met quality standards, GAO identified quality-of-care issues at both types of homes; and (9) although VA has initiated efforts to improve its data on the cost of providing and purchasing nursing home care, the availability of nursing home beds in local markets, and the adequacy of VA reimbursement rates to purchase quality nursing home care for veterans, better information is still needed for VA to make informed resource management decisions.

Recommendation for Executive Action

  1. Status: Closed - Implemented

    Comments: VHA reported that it completed implementation of its Decision Support System software in November, 1998, a system that allows collection of cost data for nursing home care. VHA also reported efforts to increase competitiveness of nursing home reimbursement rates, for example, by giving local VA facilities the option to approve exemptions from the standard payment rate (which is based on Medicaid schedules plus 15%). In addition, the Undersecretary of Health commissioned a study to develop a strategy on how to best meet the long term care needs of veterans by assessing the availability of community nursing home resources and other alternatives.

    Recommendation: As part of VA's ongoing efforts to improve nursing home resource management decisions, the Secretary of Veterans Affairs should direct the Under Secretary for Health to more accurately accumulate and report nursing home costs, assess the availability of community nursing home resources, and identify locations where current reimbursement rates are not competitive.

    Agency Affected: Department of Veterans Affairs


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