Veterans Administration:

VA Pensions to Medicaid Nursing Home Residents Should Be Reduced

HRD-87-111: Published: Jul 10, 1987. Publicly Released: Aug 11, 1987.

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Joseph F. Delfico
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GAO reviewed how Veterans Administration (VA) and Medicaid benefits interact to determine: (1) how many medical nursing home residents are receiving VA pensions; (2) how states apply these pensions toward the cost of care; (3) the effect of VA pensions on state and federal costs; and (4) how other needs-based programs adjust benefits for institutionalized recipients.

GAO found that: (1) about 6 percent of the Medicaid nursing home residents in the eight states it reviewed received VA benefits; (2) each state required veterans to apply their VA pensions toward the cost of their care; (3) because the states applied the VA payments to the cost of care as part of the Medicaid recipient's income, the federal government paid a higher percentage of Medicaid nursing home costs for veterans with VA benefits than those with no income; and (4) all eight states instituted programs to maximize VA benefit collections on behalf of Medicaid nursing home residents, since the federal government pays about 71 percent of the cost.

Matter for Congressional Consideration

  1. Status: Closed - Implemented

    Comments: Committee staff supports this recommendation and will consider action during the cycle if the budget deficit worsens. Congress enacted the Omnibus Budget Reconciliation Act of 1990 (P.L. 101-508) which reduced VA pensions to $90 a month for veterans without dependents who receive Medicaid-supported nursing home care.

    Matter: Congress should amend title 38 to require that the VA pension for veterans and their survivors who enter a nursing home under Medicaid be reduced. One way would be to amend title 38 to extend the VA pension reduction criteria that currently apply when the recipient is institutionalized in a VA-supported facility to cover recipients supported by Medicaid. Alternately, the reduction could be tailored to the personal needs allowance established by each state Medicaid agency.


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