Veterans' Health Care:

Potential Effects of Health Care Reforms on VA's Major Construction Program

T-HRD-93-19: Published: May 6, 1993. Publicly Released: May 6, 1993.

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GAO discussed the Department of Veterans Affairs' (VA) major construction program, focusing on: (1) factors affecting the need for and design of VA construction projects; (2) VA consideration of construction alternatives when determining construction needs; and (3) VA management of its major construction program. GAO noted that: (1) national health insurance reform could reduce the demand for VA services and the use of VA outpatient care by as much as 50 percent; (2) converting excess VA hospital capacity to nursing home care could reduce the need for, and cost of, future nursing home construction; (3) VA eligibility criteria reform will have a significant impact on the demand for VA health care services; (4) if the VA role changes under a managed care model, VA will be unable to compete with private health plans because its facilities cannot offer the full range of health care services needed by veterans, particularly female veterans, and their families; (5) VA needs to determine if it should proceed with planned construction or renovation of limited-capability facilities or wait until its future role is decided; (6) VA does not adequately consider unused community and military resources to meet its needs; (7) VA could test alternative methods of delivering services through demonstration projects while waiting for reform decisions to be made; (8) VA does not consistently consider insurance coverage and veterans' incomes when planning VA projects which frequently exceed program needs; and (9) VA needs to delay construction funding until design development is complete in order to avoid cost overruns.

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