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96–918PDF 2004

DEPARTMENT OF VETERANS AFFAIRS POLICIES

AFFECTING THE MILLIONS OF VETERANS WHO

WILL NEED LONG-TERM CARE IN THE NEXT

TEN YEARS

HEARING

BEFORE THE

COMMITTEE ON VETERANS’ AFFAIRS

HOUSE OF REPRESENTATIVES 

ONE HUNDRED EIGHTH CONGRESS

SECOND SESSION

JANUARY 28, 2004

Printed for the use of the Committee on Veterans’ Affairs

Serial No. 108–29

(
COMMITTEE ON VETERANS’ AFFAIRS 

CHRISTOPHER H. SMITH, New Jersey, Chairman 

MICHAEL BILIRAKIS, Florida 

TERRY EVERETT, Alabama 

STEPHEN E. BUYER, Indiana 

JACK QUINN, New York 

CLIFF STEARNS, Florida 

JERRY MORAN, Kansas 

RICHARD H. BAKER, Louisiana 

ROB SIMMONS, Connecticut 

HENRY E. BROWN, JR., South Carolina 

JEFF MILLER, Florida 

JOHN BOOZMAN, Arkansas 

JEB BRADLEY, New Hampshire 

BOB BEAUPREZ, Colorado 

GINNY BROWN-WAITE, Florida 

RICK RENZI, Arizona 

TIM MURPHY, Pennsylvania 

LANE EVANS, Illinois 

BOB FILNER, California 

LUIS V. GUTIERREZ, Illinois 

CORRINE BROWN, Florida 

VIC SNYDER, Arkansas 

CIRO D. RODRIGUEZ, Texas 

MICHAEL H. MICHAUD, Maine 

DARLENE HOOLEY, Oregon 

TED STRICKLAND, Ohio 

SHELLEY BERKLEY, Nevada 

TOM UDALL, New Mexico 

SUSAN A. DAVIS, California 

TIM RYAN, Ohio 

STEPHANIE HERSETH, South Dakota

PATRICK E. RYAN, Chief Counsel and Staff Director

(II) 
(III)

C O N T E N T S 

January 28, 2004

Page

Department of Veterans Affairs Policies Affecting the Millions of Veterans 

Who Will Need Long-Term Care in the Next Ten Years .................................. 1

OPENING STATEMENTS 

Chairman Smith ...................................................................................................... 1

Hon. Lane Evans, ranking democratic member, Committee on Veterans’ Affairs ....................................................................................................................... 3

Prepared statement of Congressman Evans .................................................. 45

Hon. Bob Beauprez .................................................................................................. 3

Hon. Rob Simmons, chairman, Subcommittee on Health .................................... 3

Hon. Darlene Hooley ............................................................................................... 4

Hon. Cliff Stearns .................................................................................................... 5

Hon. Rick Renzi ....................................................................................................... 12

Hon. Michael H. Michaud ....................................................................................... 3, 13

Hon. Ted Strickland ................................................................................................ 15

Hon. Susan A. Davis ................................................................................................ 19

Hon. Richard H. Baker ............................................................................................ 20

Hon. Shelley Berkley ............................................................................................... 27

Hon. Tim Ryan ......................................................................................................... 32

Hon. Luis V. Gutierrez, prepared statement of ..................................................... 49

Hon. Tom Udall, prepared statement of ................................................................ 50

WITNESSES 

Bascetta, Cynthia A., Director, Healthcare, Veterans’ Health and Benefits 

Issues, General Accounting Office, accompanied by Jim Musselwhite, Assistant Director, Healthcare, Veterans’ Health and Benefits Issues, General 

Accounting Office ................................................................................................. 6

Prepared statement of Ms. Bascetta ............................................................... 51

Daigh, Jr., John D., M.D., Assistant Inspector General for Health Care Inspections, Office of Inspector General, Department of Veterans Affairs, 

accompanied by Victoria Coates, Director, Atlanta Regional Office of 

Healthcare Inspections, Office of Inspector General, Department of Veterans Affairs ......................................................................................................... 8

Prepared statement of Dr. Daigh .................................................................... 70

Gong, Jade, Member, VA Geriatrics and Gerontology Advisory Committee, 

Health Strategy Associates ................................................................................. 34

Prepared statement of Ms. Gong ..................................................................... 150

Jean, Philip, President, National Association of State Veterans Homes, Maine 

Veterans Home ..................................................................................................... 38

Prepared statement and supplement to testimony of Mr. Jean ...................161,172

Roswell, Robert H., M.D., Under Secretary for Health, Department of Veterans Affairs; accompanied by James F. Burris, M.D., Chief Consultant 

for Geriatrics And Extended Care, Strategic Healthcare Group, Veterans 

Health Administration, Department of Veterans Affairs ................................. 22

Prepared statement of Dr. Roswell, with attachment, .................................. 146

Sabo, Linda, Executive Director, Alzheimer’s Association, Western New York 

Chapter ................................................................................................................. 36

Prepared statement of Ms. Sabo ..................................................................... 157
Page

IV

MATERIAL SUBMITTED FOR THE RECORD 

Chart: 

‘‘Population of Veterans Age 85 and Older,’’ compiled by Democratic 

Staff of the House Committee on Veterans’ Affairs ................................... 48

Reports: 

‘‘Evaluation of the Veterans Health Administration’s Contract Community Nursing Home Program,’’ prepared by VA Office of Inspector General, December 31, 2002 ............................................................................... 79

‘‘Evaluation of the Veterans Health Administration Homemaker and 

Home Health Aide Program,’’ prepared by VA Office of Inspector General, Office of Healthcare Inspections, December 18, 2003 ....................... 122

Statements: 

The American Legion ....................................................................................... 176

AMVETS ........................................................................................................... 185

Disabled American Veterans ........................................................................... 190

Paralyzed Veterans of America ....................................................................... 195

American Health Care Association ................................................................. 206

American Association for Geriatric Psychiatry .............................................. 209

Written committee questions and their responses; 

Chairman Smith to Department of Veterans Affairs .................................... 225

Chairman Smith to Ms. Linda Sabo, Executive Director, Alzheimer’s Association of Western New York Chapter ..................................................... 240

Chairman Smith and Congressman Evans to National Association of 

State Veterans Homes .................................................................................. 243
(1)

DEPARTMENT OF VETERANS AFFAIRS POLICIES AFFECTING THE MILLIONS OF VETERANS WHO WILL NEED LONG-TERM CARE 

IN THE NEXT TEN YEARS 

WEDNESDAY, JANUARY 28, 2004

U.S. HOUSE OF REPRESENTATIVES, 

COMMITTEE ON VETERANS’ AFFAIRS, 

Washington, DC 

The committee met, pursuant to notice, at 12 p.m., in room 334, 

Cannon House Office Building, Hon. Chris Smith (chairman of the 

committee) presiding. 

Present: Representatives Smith, Stearns, Moran, Baker, Simmons, Miller, Bradley, Beauprez, Renzi, Murphy, Evans, Michaud, 

Hooley, Strickland, Berkley, Udall, Davis, and Ryan. 

OPENING STATEMENT OF CHAIRMAN SMITH 

The CHAIRMAN. The committee will come to order, and I want to 

wish everyone a good afternoon. 

Our hearing today is focused on a very important part of the 

VA’s mission, caring for older veterans. There is little dispute about 

the significant growth in the number of aging veterans who will 

need some sort of medical assistance over the next 10 to 15 years. 

Despite these clear projections, however, it is not clear whether or 

how the VA will meet this challenge. 

Last year, planners in the Veterans Health Administration compiled a national assessment of veterans’ future demand for VA 

health care services and the facilities needed to deliver those services. To the dismay of many of us, the VHA CARES plan contains 

not a single proposal to deal with veterans’ long-term care needs. 

VA planners justified this outcome on the basis that VA lacked a 

reliable planning model. They promised to come up with a plan to 

meet veterans’ long-term care needs at a later date. However, VA 

prepared and adopted a long-term care planning model in 1997 to 

help a prestigious federal advisory committee conclude its work on 

this very topic. Congress and veteran advocates believe it is absolutely critical for the CARES Commission to address this glaring 

gap in VA’s mission planning. And we look forward to reviewing its 

report next month. 

In 1999, following the issuance of the Final Report of the Federal 

Advisory Committee on Long Term Care, Congress enacted legislation consistent with its recommendations to give impetus to VA’s 

efforts to meet the health care needs of older Americans—veterans. 
2

The Millennium Health Care and Benefits Act (Public Law 106– 117) requires the Veterans Administration to: maintain its own 

long-term care programs; sustain a defined number of nursing 

home beds; and enhance other long-term care such as geriatric 

evaluation, domiciliary, adult day health care, respite, palliative 

and hospice programs in both institutional and non-institutional 

settings. All these authorities were recently extended in Public Law 

108–170, our 2003 veterans health bill, reconfirming Congress’ clear intent that VA fully implement these programs. 

I believe that VA’s single biggest challenge in health care today, 

and for the next decade or more, is how to best address the growing number of elderly veterans who need care for chronic and complicated health problems. 

Although Dr. Roswell has testified repeatedly that VA should 

provide more care in settings other than nursing home beds, VA 

has struggled to expand alternatives to institutional care in recent 

years and has not kept pace with the rising demand for such services. In an effort to learn more about what is driving VA’s longterm care decisions, we asked GAO to undertake a thorough review 

of the number of veterans receiving VA services and the cost to VA. 

When GAO began its work, it was confronted by a dearth of reliable information on VA’s long-term care programs. it was many 

months before the VA could compile data useful to GAO. GAO’s 

testimony illuminates some fundamental issues: VA cannot verify 

its actual capacity to deliver long-term care, and some of the indicators VA uses are misleading. Moreover, VA is unable to accurately report on the cost of services provided to veterans. These 

findings raise fundamental questions, who is actually managing 

VA’s provision of long-term care, and how is it being done without 

basic performance and cost data? 

The testimony of the VA and the VA inspector general led to a 

conclusion that stronger guidance and direction is sorely needed if 

VA is to fulfill its long-term care mission. Although VA has a series 

of policies in place covering different aspects and initiatives in 

long-term care, it seems that there are few consequences if managers ignore these policies. 

As I mentioned, the VA’s inspector general for health care inspections will testify about recent oversight and review of VA management of long-term care. For many years, the IG has been critical of the management programs VA uses to contract for veterans 

long-term care needs. In a report issued last month, the IG found 

an all-too familiar lack of policy guidance and overspending in 

these programs. In addition, the IG documented disturbing and inexplicable placement decisions that resulted in some veterans receiving homemaker and home-health aide services who did not 

need them, while large numbers of veterans who needed such services could not obtain them. VA has identified homemaker and home 

health aides as an important non-institutional service for homebound chronically-ill veterans. There is certainly a great demand 

for these services, and VA needs to examine the administration of 

this program far more closely. 

I look forward to the witnesses and the statements they will 

make. And we are especially grateful that Under Secretary Roswell 

is here and will provide testimony to the committee. 
3

I would like to at this point yield to my good friend, Mr. Evans, 

the ranking Democrat, for any opening comments he might have. 

OPENING STATEMENT OF HON. LANE EVANS, RANKING 

DEMOCRATIC MEMBER, COMMITTEE ON VETERANS’ AFFAIRS 

Mr. EVANS. Thank you, Mr. Chairman. And thank you for choosing this topic of long-term health care as the first hearing of this 

year. The committee has had a long history of passing beneficial 

long-term care legislation for veterans, such as the Millennium bill. 

We don’t want to see it undermined by policy changes which do not 

comport with congressional intent. The bill requires the VA to 

maintain the capacity of its in-house, long-term care health programs. We also ask the VA to completely consider innovative pilots 

of assisted living and case management. It requires the VA to offer 

lifetime care to highly service-connected veterans. In many ways 

this is a monumental bill. 

So what other changes have we seen in the VA’s programming 

since this monumental legislation was enacted? According to a report VA sent to this committee just a few weeks ago, very few. Mr. 

Chairman, we have some serious questions to raise regarding VA’s 

implementation of this bill and other policies that are seriously affecting the provision of long-term care for our veterans. 

I look forward to working with you to continue to address these 

concerns and thank you for holding this hearing. I appreciate it. 

[The prepared statement of Congressman Evans appears on p. 

45.] 

The CHAIRMAN. Thank you very much, Mr. Evans. Mr. Moran. 

Mr. MORAN. Mr. Chairman, thank you very much. I have no 

opening statement but do appreciate the opportunity to listen and 

learn about this particular issue and the challenge the VA faces in 

meeting the needs of our aging veteran population. Thank you, Mr. 

Chairman. 

The CHAIRMAN. The gentleman from Kansas, Mr. Michaud? 

Mr. MICHAUD. Thank you, Mr. Chairman. I have no opening 

statement. I do want to thank you, Mr. Chairman, and Ranking 

Member Evans for having this hearing. It is timely and it is an 

issue that I am really concerned about. Thank you very much. 

The CHAIRMAN. Thank you very much. Mr. Beauprez? 

Mr. BEAUPREZ. Thank you, Mr. Chairman. I, too, find this to be 

a very timely topic. We have got an issue very much on the front 

burner in Colorado right now with the state veterans nursing home 

and long-term care for all our veterans is very much of interest to 

me. So thank you for the timeliness and the selection of this topic 

for a hearing. 

The CHAIRMAN. Thank you very much. Mr. Renzi? Mr. Miller? 

Chairman Simmons? 

OPENING STATEMENT OF HON. ROB SIMMONS, CHAIRMAN, 

SUBCOMMITTEE ON HEALTH 

Mr. SIMMONS. Thank you, Mr. Chairman, for holding this hearing. It is a follow-on of hearings that we have had in the Health 

Subcommittee last year. And, as we know from the statistics, it is 

an incredibly important issue. In I believe 1998, 387,000 veterans 

were 85 years or older. In fiscal year 2002, 640,000 veterans were 
4

85 years or older. And this year it is 870,000. And so these are dramatic increases. And this is essentially the population that I see 

that would be seeking long-term health care. So in anticipation of 

the growth of this population, I think this hearing is very appropriate. 

I also want to make a brief comment about the fact that in Connecticut in 1864 we founded the first state home for veterans, 1864. 

It was originally started by a wealthy businessman who promised 

to care for all soldiers who were wounded in the Civil War and all 

widows and orphans whose husband or father was killed. And that 

was the first time I think in the history of the country that a state 

stepped up to the plate and established a state home. 

We still have that state home. It is currently at Rocky Hill. It 

has been at that location for over 100 years. And we have a developing partnership with the VA where Linda Schwartz, who is our 

state commissioner of veterans’ affairs, working with Roger Johnson, who heads the VA in Connecticut, are actually partnering so 

that the VA focuses on primary care and a high-quality of health 

care, surgeries, this sort of thing. 

And then the Connecticut DVA focuses on taking some of the 

long-term or chronic care patients. And it works extremely well because the citizens of Connecticut are able to step up to the plate 

and support these long-term care patients in a home environment, 

a home environment. Meanwhile, the VA can focus on its resources 

on having one of the best hospitals, the West Haven VA Hospital 

and a system of CBOCs to deal with the more acute or more critical health care needs of our veterans. 

So I would simply say that in the State of Connecticut that 

works as a very fine model. It may not work elsewhere in the country, but I would be interested to hear what the witnesses have to 

say about this issue, and I thank the Chair. 

The CHAIRMAN. Thank you, Chairman Simmons. Mr. Strickland, 

the gentleman from Ohio? 

Mr. STRICKLAND. No opening statement. 

The CHAIRMAN. Mr. Udall. 

Mr. UDALL. Thank you, Mr. Chairman, but I don’t have an opening statement. Thank you very much. 

The CHAIRMAN. Ms. Hooley. 

OPENING STATEMENT OF HON. DARLENE HOOLEY 

Ms. HOOLEY. Thank you, Mr. Chairman. In very recent years——

The CHAIRMAN. Could you put on your microphone, please? 

Ms. HOOLEY. Thank you. I thought I had a loud voice, okay? 

In very recent years we have seen an increase in the number of 

veterans age 85 and older—mostly our World War II veterans—requiring some type of long-term care. The number of veterans in 

this age group is expected to rise dramatically in the next decade. 

I am pleased the VA has expanded upon its non-institutional focus 

as a means of reaching more veterans in need of care. Through 

home-based primary care, homemaker/home health aides, adult 

day care, skilled home care, and home respite and hospice care, the 

VA, hopefully where appropriate, has shifted the focus of care to 

a more cost-effective and to a generally more welcome setting in 

the minds of our veterans and their families. 
5

In all types of non-institutional long-term care we see approximately a 75 percent increase in the average daily census workload 

over the last 6 years. We are reaching more veterans but is the 

level of care adequate? Does one three hour visit from a homemaker each week adequately support an 85-year-old veteran at 

home with an ailing spouse? The program has advantages, but it 

must be robust enough to be meaningful. How would this once a 

week visit count during the average daily census count? Are increasing numbers an indication of meaningful support and care or 

do they indicate that we are just reaching more veterans? As costeffective and welcome as non-institutional options may be for all 

concerned, there are times when this option is not the best option 

and institutional care is warranted. 

This institutional option does not diminish as the population of 

85-year-olds grows. With the number of those likely requiring longterm care in a nursing home setting growing, why did this administration in its 2004 budget request propose closing some 5,000 beds? 

Why does VA propose limiting access by veterans it is required to 

treat? 

Mr. Chairman, in our oversight role, this committee must consistently look over the horizon and help VA identify potential problems they may have missed in their planning and budgeting process. Thank you for calling this hearing. I believe it is important to 

have a VA plan for adequate care for our veterans. 

Thank you, Mr. Chairman. 

The CHAIRMAN. Thank you, Ms. Hooley. I would like to welcome 

our first panel of witnesses to the table. I am sorry, I would like 

to recognize Congressman Stearns, who is the author of the Millennium Health Care Act, for any comments he would like to make. 

OPENING STATEMENT OF HON. CLIFF STEARNS 

Mr. STEARNS. Thank you, Mr. Chairman. I got in in the nick of 

time here. I appreciate that. And, again, I want to thank you for 

holding this hearing on VA long-term care programs. As you mentioned, I was very proud to author the Millennium Health Care 

Benefits Act, Public Law 106–117. And important components in it 

were to expand long-term care options for veterans and their care 

givers. I see that the 2000 census-based veteran population 2001 

shows there were 25.6 million veterans in 2002. I think a lot of 

them obviously live in Florida. In fact, actually, Florida has the 

second-largest veterans population and the number one, Mr. Chairman, oldest. So long-term care needs are of tremendous interest to 

our state. 

The VA points out that the most new demand for LTC is being 

met through non-institutional services. And there is also a rise in 

home and community health care-based care. As the author of a 

provision in the new Medicare law that conducts a demonstration 

project for consumer-directed care, which is currently done in the 

Medicaid program, with great emphasis in home care services, I am 

intrigued to hear what might be some options for veterans here 

today. 

So, again, I thank you, Mr. Chairman, for holding this hearing, 

and I look forward to hearing from our panelists. 
6

The CHAIRMAN. Thank you very much, Mr. Stearns. I would like 

to welcome Ms. Cynthia Bascetta, who is the director of the Veterans’ Health and Benefits Issues at the General Accounting Office. 

For the past 4 years, she has led reviews of VA budget and planning process and evaluations of specific programs in the Veterans 

Health Administration and the Veterans Benefits Administration. 

Before that, she directed GAO’s work on the Social Security Administration’s disability programs. Her work resulted in billions of dollars in savings and supported bipartisan legislation to improve the 

disability insurance and Supplemental Security Income programs. 

Ms. Bascetta joined GAO in 1983 after beginning her career at 

the U.S. Department of Labor’s Occupational Safety and Health 

Administration where she prepared regulatory impact analyses of 

major workplace health standards. She has been a frequent and 

very valuable witness before this committee, and we welcome her 

today. 

She is joined by Dr. John Daigh, who is the Assistant Inspector 

General for Health Care Inspections in the Office of the Inspector 

General at the VA. Dr. Daigh has a distinguished career as a colonel with the United States Army. He attended the United States 

Military Academy in West Point, New York and graduated with a 

Bachelor of Science degree in 1974. He obtained his medical degree 

from the University of Texas Medical School in Dallas, Texas in 

1978. He also has a degree in accounting and a master’s degree in 

taxation. 

Dr. Daigh held various positions from 1983 to 1998 at Walter 

Reed Army Medical Center. Most recently he was the chief of the 

Department of Neurology. He has also spent time at the Uniformed 

Services University of Health Sciences in Bethesda, MD as assistant professor of neurology and assistant professor of pediatrics 

from 1984 to 2002. He retired from active duty in 2002. And Dr. 

Daigh, you are welcome, as well. 

Ms. Bascetta, if you could begin and introduce the remainder of 

your panel, if you would. 

STATEMENTS OF CYNTHIA A. BASCETTA, DIRECTOR, 

HEALTHCARE, VETERANS’ HEALTH AND BENEFITS ISSUES, 

GENERAL ACCOUNTING OFFICE, ACCOMPANIED BY JIM 

MUSSELWHITE, ASSISTANT DIRECTOR, HEALTHCARE, VETERANS’ HEALTH AND BENEFITS ISSUES, GENERAL ACCOUNTING OFFICE; AND JOHN D. DAIGH, JR., M.D., ASSISTANT INSPECTOR GENERAL FOR HEALTH CARE INSPECTIONS, OFFICE OF INSPECTOR GENERAL, DEPARTMENT OF 

VETERANS AFFAIRS, ACCOMPANIED BY VICTORIA COATES, 

DIRECTOR, ATLANTA REGIONAL OFFICE OF HEALTHCARE 

INSPECTIONS, OFFICE OF INSPECTOR GENERAL, DEPARTMENT OF VETERANS AFFAIRS 

STATEMENT OF CYNTHIA A. BASCETTA 

Ms. BASCETTA. Thank you, Mr. Chairman. I am accompanied 

today by Jim Musselwhite, who led this work. We appreciate the 

invitation to testify today about VA’s long-term care services. I 

won’t repeat the projections we know so well, but I would like to 

point out that for the last 6 years the aging veteran population has 
7

already posed a pressing demographic challenge for VA. During 

this time, the ranks of these elderly veterans rose dramatically by 

about 100 percent. As you know, these are the veterans most in 

need of long-term care services. And now and for the foreseeable 

future we can expect many of them to seek a range of long-term 

care services from VA. 

Our current findings provide a clear picture of changes in workload for both nursing home care and non-institutional services. But 

they also raise important questions yet to be answered. In a nutshell, has access to VA services been sufficient to meet the needs 

of elderly veterans so far and will it be sufficient in the future? Answering this fundamental question will require better analysis and 

data from VA than we have seen so far. 

My testimony today is based on our ongoing review for this committee of VA’s nursing home care and non-institutional services 

workload, measured in terms of average daily census. Our work required extensive data verification efforts because VA could not provide reasonable assurance that its data were complete and accurate. In particular, information from headquarters was often delayed and inconsistent with network data. Workload numbers for 

some services took VA over 6 months to provide with sufficient documentation, and we are still waiting for complete documentation of 

VA’s non-institutional services workload. Although we are confident in the findings we are reporting to you today, we continue 

to be concerned about VA’s ability to provide basic management information about long-term care in a timely and reliable manner. 

Let’s look first at what happened to nursing home workload over 

the last 6 years. In 2003, nursing home workload was 33,214, 1 

percent below its fiscal year 1998 workload, with a dip in fiscal 

year 2000 of 8 percent below the 1998 level. Dis-aggregating the 

data by network reveals much greater increases and decreases in 

this workload. The sharpest decline was 19 percent in one network 

and the steepest increase was 42 percent in another. VA needs to 

explain what this variation might mean for meeting veterans’

needs in different parts of the country. 

Where veterans receive nursing home care also changed during 

this period. The average daily census in VA’s own nursing homes 

and in community nursing homes combined dropped by more than 

2,400. In contrast, average daily census in state veterans homes 

rose steadily, almost offsetting the declines in the other settings. 

By 2003, fully half of all nursing home care was provided in state 

homes, up from 43 percent in 1998. 

To evaluate this change, we need to better understand the implications for access, quality, and cost of this shift to using state veterans homes. And we need to know if the slice of the nursing home 

pie going to state veterans homes is going to grow even larger. 

VA’s own homes now account for about 37 percent of the workload, down from 40 percent in 1998. This is largely explained by 

our analysis of length of stay trends, which shows that fewer veterans with stays of 90 days or longer were in VA’s own homes. 

Short stay patients increased but not enough to offset the decline 

in long-stay patients. Again, a network level analysis shows variation in this trend. While most networks showed declines, long stay 

patients in VA’s own homes did increase in five networks. 
8

VA officials attribute the overall decline in long stay patients to 

the priority given to post-acute care, the type of skilled nursing 

home care financed by Medicare. We need a better understanding 

of the effect of this priority on VA’s ability to provide long-term 

nursing home care. VA can help by making transparent its strategy 

for providing the full continuum of long-term care services to eligible veterans. 

The workload in community nursing homes paralleled the decline 

in VA’s own homes, dropping from 17 to 13 percent of workload by 

2003. Many fewer veterans received care in this setting. VA officials told us that compared to the past, they used shorter-term contracts, often 30 days or less, to transition to veterans to nursing 

home care financed by other payers, such as Medicaid. 

Turning to non-institutional services, we found that average 

daily census increased by 75 percent over the last 6 years, although 

these services still constitute a much smaller proportion of the total 

long-term care workload. Much of the growth was in skilled home 

health care and homemaker home health aide services, which are 

key to preventing or delaying nursing home care. 

As in our prior work, once again the prominent theme of variation, this time among facilities, was a key finding for us. Some facilities did not offer some of the non-institutional services at all or 

offered them only in certain parts of the geographic area they 

served. But, as I mentioned in my initial remarks, we have not 

been able to analyze the potential variation in this workload because of significant delays in obtaining data from VA. 

Mr. Chairman, I would also like to point out that the workload 

numbers we present for home-based primary care are substantially 

lower than those reported by VA in the budget and in previous testimony. This is because we re-calculated them for comparability 

with the measures of all other non-institutional services and to better reflect utilization. As you can see, our estimate of this workload 

is 944, much less than the 8,370 figure reported by VA for 2003. 

To summarize, because of the striking demographic changes that 

have already occurred, and the further aging of the population expected over the next decade, it seems clear that you and other 

stakeholders need answers to several important questions. We believe such information is necessary for more effective oversight of 

both VA’s performance so far and its plans to meet the long-term 

care challenge in the future. 

We look forward to continuing our work for you on these very important matters. 

[The prepared statement of Ms. Bascetta appears on p. 51.] 

The CHAIRMAN. Ms. Bascetta, thank you very much for your testimony. Dr. Daigh. 

STATEMENT OF JOHN D. DAIGH, JR. 

Dr. DAIGH. Mr. Chairman, I am pleased to have Ms. Victoria 

Coates here beside me. She is the regional director from Atlanta 

from our office. 

Mr. Chairman and members of the committee, I am pleased to 

be here today to discuss programs that directly impact the quality 

of life of millions of veterans who need long-term care services. 

Today, I will present you with the results of our evaluation of the 
9

Department of Veteran’s Affairs Veterans Health Administration 

Community Nursing Home Program and the Homemaker and 

Home Health Aide Program. The Department of Veterans Affairs 

Office of Inspector General, Office of Healthcare Inspections conducted an evaluation of the community nursing home program to 

follow up on the Veteran’s Health Administration’s efforts to 

strengthen their monitoring of the program and to ensure that veterans receive appropriate care in a safe environment. 

We visited eight VA medical facilities nationwide that contracted 

with 302 community nursing homes in their jurisdiction. We visited 

25 of these nursing homes where we selected a sample of 111 veterans who were residents in these facilities, and we visited these 

veterans at these nursing homes. We reviewed their medical 

records at the nursing home and at the referring VA medical facility. At each VA medical facility, we interviewed the community 

nursing home program directors and staff, the relevant contract officials, and VA facility managers. 

We also reviewed data from the Department of Health and 

Human Services, Center for Medicaid and Medicare Services. We 

found that while veterans we visited in the community nursing 

homes were generally well cared for, 8.1 percent of the veterans in 

our sample had been the subject of reported cases of abuse, neglect, 

or financial exploitation. Twenty-seven percent of the veterans in 

our sample were placed in nursing homes where CMS data showed 

that the nursing home had placed residents in harm’s way or in 

immediate jeopardy. Quality assurance data from community nursing homes was often not incorporated into the VA medical facility’s 

decision-making process. Contract procedures and inspection practices varied among VA facilities. Community nursing home review 

teams do not meet annually with Veterans Benefit Administration 

fiduciary and field examination examiners to discuss veterans of 

mutual concern. 

We made 11 recommendations to the VHA and one to VBA in 

this report. The under secretary for health concurred with all recommendations except one affecting community nursing homes more 

than 50 miles away from parent facilities. The under secretary for 

benefits concurred with the recommendation to improve the information exchange between VBA and VHA personnel. 

Let me now move on to our evaluation to determine whether the 

homemaker and home health aide programs at VHA medical facilities were in compliance with VHA policy and whether homemaker 

and home health aide services provided to patients were clinically 

appropriate, cost-effective, and met customer expectations. 

As part of the Office of the Inspector General’s combined assessment program reviews, we inspected homemaker and home health 

aide programs at 17 VA facilities. We selected 142 patients as a 

sample population. Our reviews showed that 20 of these 142 patients had medical records that indicated that the patients did not 

meet clinical eligibility requirements to receive homemaker and 

home health aide services. Twelve the 142 patients did not have 

any activities of daily living dependencies documented in their initial assessments for homemaker and home health aidee services. 

Fifty-nine percent of the VA medical facilities we visited had wait-
10

ing lists for placements in their homemaker and home health aide 

programs. 

Only 18 percent of the community health agencies we visited provided quarterly documentation of performance improvement activities back to the VA program managers. And 24 percent of the veterans receiving homemaker and home health aide services also received basic special monthly compensation or pension benefits from 

VBA due to their need for agent attendance. 

We recommended that the under secretary for health issue a policy replacing the expired VHA Directive 96–031 and provide additional guidance requiring that patients receive thorough initial 

inter-disciplinary assessments prior to homemaker and home 

health aide program placement. We also recommended that patients receiving homemaker and home health aide services meet 

clinical eligibility requirements and that benchmark rates for these 

services be established. We further recommended that the under 

secretary seek general counsel opinion on whether veterans basic 

monthly compensation from the Veterans Benefit Administration, 

due to their need for aid in attendance, status be considered when 

prioritizing these services and determining the frequency visits. 

The under secretary of health concurred with the findings and recommendations. VHA subsequently published guidance for benchmark rates to be used for this program. 

This concludes my testimony. I would be pleased to answer any 

questions that you and the members of this committee may have. 

[The prepared statement of Dr. Daigh appears on p. 70.] 

The CHAIRMAN. Thank you very much, Dr. Daigh. Let me just 

begin the Federal Advisory Committee Report in 1998 made this 

comment in their conclusion section, ‘‘Without changes to the system, VA is at risk of eventually dismantling its long-term care system. Despite high quality and continued need, long-term care is 

perceived to be an adjunct entity unevenly funded and under valued. Continued neglect of the long-term care system will lead to 

further marginalization and disintegration and have costly unintended consequences throughout the VA health care system.’’

And I was wondering as you have made your recommendations 

and as I have read your reports, you paint, I think, a very disturbing picture of the unanswered questions about whether or not 

the shift to the state homes has indeed has led to any demise in 

the area of access or quality, not to mention the fact that we have, 

as you pointed out in your testimony, Dr. Daigh, a significant rise 

in those who will be eligible peaking in the year 2013. The numbers are staggering when you look at need. And yet we seem to be 

ebbing if not in decline. Mention was made earlier about the 5,000 

beds that might have been idle had the recommendation for funding gone through for 2004. 

In a bipartisan way, this committee, working very, very hard in 

a tortuous legislative process that only within days concluded, 

upped the amount of money available for health care, medical care 

by $2.9 billion year over year for a big increase. So the hope is that 

at minimum those 5,000 beds not only will not be idle, they will 

remain robust and available, but that we will also add to them. 

If you could comment on that question: have we made any 

progress? There was a very dire observation made back in 1998 
11

about the corrosive effect of neglect, the idea of being undervalued. 

And then we look at VISN–2 where there is the Partners for Dementia and they are working side by side with the Alzheimer’s Association, and we will hear about that later on. There is a recognition that much could be done where there is the will, if you might 

want to comment on that, Ms. Bascetta? 

Ms. BASCETTA. Well, I think we are definitely making progress, 

particularly in the non-institutional area, but the burning question 

is what is the need, what is the range of services that veterans 

need and in what parts of the country and how are the services 

matching up with the need. That is what has been lacking for a 

long time. And without that fundamental information, I don’t know 

how we will ever be able to decide how much progress we have 

made and whether the steps that we are taking are ones that we 

agree are appropriate. 

The CHAIRMAN. Are there reasons why you have been unable to 

get that basic data? 

Ms. BASCETTA. Well, that basic data that we are talking about 

now as opposed to the information on program review that we have 

been trying to get is their long-term planning model, which is separate from the data problems that I was discussing in my testimony. 

We have been asking about the status of the long-term planning 

model probably for about a year now. And, as you mentioned in 

your opening statement, part of that is linked to CARES. 

The CHAIRMAN. We will have, and this committee will do its rigorous oversight on any recommendation by CARES, but I find it 

still to be astonishing and unconscionable that left out of the process is a meaningful discussion, or any discussion at all, about longterm health care and what assets are needed to accommodate this 

exponential growth in need. 

Let me just mention Dr. Joel Streim, who will not be testifying— he can’t make it today—but he has submitted testimony from the 

American Association for Geriatric Psychiatry. He makes a very interesting point which we all kind of know, but he quantifies it I 

think in a way that bears raising, especially if we are going to 

marry up need—or resources with need. He points out that: ‘‘The 

prevalence rate of diagnosable psychiatry disorders among residents of community nursing homes is between 80 to 90 percent. We 

call them nursing homes but the numbers indicate that these facilities are defacto institutions for the care of patients with mental 

illnesses.’’

Dr. Daigh, you may want to comment on this as well. He points 

in his testimony that there is a lack of the type of skill base, especially psychiatrists and people who could handle people suffering 

from dementia, so that the provision of care may not be meeting 

the actual day to day needs of those who are in, as he points out, 

what are really homes for mental patients, particularly with dementia. 

Dr. DAIGH. Mr. Chairman, I was a little surprised when we did 

our review of nursing homes and we went in and looked at the patients, to what extent psychiatric illness was a major factor in 

these patients care. A number of the veterans of World War II age 

in our sample turned out to be gentlemen who had actually been 

under government care for many years and were in long-term care 
12

because they had schizophrenia or other chronic illnesses. A tremendous number of patients had Alzheimer or Parkinson’s Disease 

or other disabilities of age. 

So it is a very difficult problem for this patient population and 

it is an extremely prevalent problem, which complicates the care 

greatly. 

The CHAIRMAN. Ms. Bascetta, did you want to comment on that? 

Ms. BASCETTA. The scope of our work was really limited to the 

elderly. We didn’t look specifically at other chronic conditions that 

would require long-term care services. 

The CHAIRMAN. But as he points out, these are the people already being cared for in at least the institutional settings? 

Ms. BASCETTA. That is right. 

The CHAIRMAN. Okay, I see my time is up. Mr. Evans? 

Mr. EVANS. Thank you, Mr. Chairman. What is the status of recommendations you have made regarding contract nursing homes, 

do you consider these problems to be resolved? 

Dr. DAIGH. Sir, we have not yet had the policy adjustments, we 

had asked VHA to come out with some policy and make some adjustments and those policy adjustments have been worked on over 

a number of years. And we are not yet satisfied that the adjustments they have proposed meet the standards that we would like 

to see for that program. It has been one of the problems that we 

have had with this program is getting a timely cycle between the 

creation of policy, the implementation of policy, and then the revision of policy. 

Mr. EVANS. What is your time line? How long can we expect the 

committee to—— Dr. DAIGH. I believe that we will receive the next draft imminently. I believe that they are shortly to get us that draft, but we 

have heard this for some time now so we would like them to move 

a little quicker. 

The CHAIRMAN. Thank you. Mr. Moran has left. Mr. Beauprez? 

He has left. Mr. Renzi? 

Mr. RENZI. Thank you, Mr. Chairman. Dr. Daigh, when you were 

providing us with a statement, you mentioned the abuse of our veterans. And I think you used a figure of 8 percent. When you define 

abuse, what kind of abuses are we seeing? 

Dr. DAIGH. We used standard definitions of abuse, the Federal 

Register had a definition of abuse and that is what we used. 

Mr. RENZI. What are they? What type of abuse? Bed sores? 

What? 

Dr. DAIGH. Oh, I see what you are talking about. We basically 

looked for neglect, abuse, and financial abuse. 

Mr. RENZI. When the abuse is found, what types of penalties, 

what corrective measures are immediately put into place? 

Dr. DAIGH. It depended on the level of abuse. If it was significant 

abuse and brought to the attention of VHA employees, we found 

that they generally acted responsibly. VHA would offer the veterans an opportunity to obtain care at another nursing home or 

they would seek proper resolution of the problem. It is hour hope 

that by more aggressively monitoring these homes, we could prevent instances of abuse. So a stronger program we think might 

lead to less abuse. 
13

Mr. RENZI. Thank you. When we are dealing the majority of time 

with contract labor, not government employees, correct? 

Dr. DAIGH. That is correct, sir. 

Mr. RENZI. So you have the ability to fire them or relieve them 

much quicker or you have the oversight over the contractor itself? 

Dr. DAIGH. I am uncertain of the answer to that question, sir. 

These are veterans in contract nursing homes, off the premises of 

the VHA facility so I don’t know the answer to that question. 

Mr. RENZI. Okay, maybe I can follow up later with Dr. Roswell. 

Thank you, sir. Thank you, Mr. Chairman. 

The CHAIRMAN. Mr. Michaud? 

Mr. MICHAUD. Thank you, Mr. Chairman. This one is for Mr. 

Bascetta. You are finding that increasing amounts of long-term 

care are being provided by state veterans home. I am very concerned that efforts to treat VA funding as a third party liability for 

Medicaid purposes may result in bankruptcy or closure of some of 

these homes. What impact would the loss of state home beds have 

on veterans, especially veterans with mental impairments who may 

need long-term institutional care? 

Ms. BASCETTA. Well, clearly with the growing tendency to place 

more and more veterans in the state homes, if there are financial 

difficulties and there is some contraction in the number of beds 

there, without going back to community homes, those veterans 

would be hard-pressed to have access to care. We didn’t look at the 

cost implications of any of these shifts in our work so far, but we 

do intend to look much more closely at both VA’s expenditures and 

the rest of the financial implications of the changes in these 

settings. 

Mr. MICHAUD. This question is for Dr. Daigh. You had mentioned 

about abuse in homes. What happens to some of these homes, is 

there a penalty for some of the abuse that you had found or find? 

Dr. DAIGH. In the course of our inspection, the cases of serious 

abuse that we found, that would typically make the newspapers or 

everyone would agree is blatant abuse, they didn’t occur to any of 

the patients in our sample. But they did occur to other residents 

in the nursing home in which veterans were resident while we 

were doing our study. And we thought that when it came to light, 

the individuals from VHA acted very responsibly in trying to ameliorate the situation the best they could in terms of treating the 

veterans appropriately. With respect to penalties to the nursing 

home, that was not the purview of our review. Most of these 

incidences would be reported to the state ombudsman and would 

also be investigated through local and state agencies. 

Mr. MICHAUD. Do you think, talking about abuse and there are 

certain types of abuse, some are more severe than others, that veterans should have the right to sue individually the Federal Government and administrators of the government for the abuse they 

have given veterans for not adequately providing the care that they 

are supposed to give our veterans in this country? That is a different type of abuse but definitely we are not taking care of the 

veterans. There are homeless veterans out there. There are hospitals who are refusing to deal with any more veterans because of 

the waiting list. Do you think that is a different type of abuse that 

we should hold the Federal Government accountable? 
14

Dr. DAIGH. Sir, I have not adequately considered that proposition 

and I don’t feel qualified to answer that right now. I could respond 

in writing if you like but I haven’t thought about that enough. 

Mr. MICHAUD. Yes, if you could respond in writing. Thank you, 

Mr. Chairman. 

The CHAIRMAN. Chairman Simmons? 

Mr. SIMMONS. Thank you, Mr. Chairman. To Ms. Bascetta, I am 

intrigued by how the VA provides per diem for people in long-term 

care that are in state hospitals or in other types of environments. 

And you mentioned that you have not perhaps studied the funding 

system thoroughly, that you may be doing that in the future, so if 

you can’t answer the question, I would be intrigued in having you 

pursue it a little bit. But the question essentially is how do we pay? 

The VA, as I understand it, will pay a per diem for a veteran in 

long-term care in a state hospital. In some cases, I have heard that 

that is offset by Medicare payments. 

And so my first question is is that per diem in addition to state 

Medicare payments or is there an offset so essentially the VA is 

subsidizing the state in its obligation under Medicaid? And then, 

secondly, it is my understanding that the per diem payment is really a fraction, in some cases 10 percent of what the cost would be 

if the long-term care was provided in a veterans facility, that the 

VA offsets the cost in private nursing homes to about 70 percent 

of the cost. 

So in this regard, and I know Dr. Roswell will probably respond 

to this question as well. In this regard, it does seem that the state 

option is a bargain. Have you had any opportunity to study that 

kind of reimbursement and have any recommendations to make on 

that subject? 

Ms. BASCETTA. As you pointed out, we haven’t looked in depth 

at this yet. We have a general awareness of the relative cost. And 

the state homes do appear to be much less expensive in terms of 

the per diem. I believe it is a little bit over $50 a month, the payment that the VA makes to the state homes. But they also share 

in the construction costs. So I guess the bottom line for us is that 

we hesitate to say anything at this point because what we do know 

is that the financing is very complicated, not only between the VA 

and the state homes but with all the other payers who are potentially involved. 

Mr. SIMMONS. One other question you may not be able to answer 

as well, sorry about that. Dr. Roswell is taking notes. When these 

payments are made, are they made directly to the state home or 

are they made to the state general fund out of which then the dollars are allocated? Do you have any idea for that? 

Ms. BASCETTA. Another good question that I will find out the answer for you hopefully in our continuing work. 

Mr. SIMMONS. The bottom line I guess from my perspective is I 

am looking for a good deal for the veterans, not necessarily a good 

deal for the states. 

Ms. BASCETTA. We agree and we think that one of the fundamental questions is the cost-effectiveness of the care. You need to 

know about the needs piece but you need to know about the efficiency with which the care is being provided, not only for the vet-
15

erans but to assure that the taxpayers are getting the best value 

for their money. 

Mr. SIMMONS. Thank you, Mr. Chairman. 

The CHAIRMAN. Mr. Strickland. 

Mr. STRICKLAND. Thank you, Mr. Chairman. The question is for 

Ms. Bascetta. My understanding is that the VA is now providing 

long-term care and I will define that by being 90 days or longer to 

only about 19 percent of the nursing home patients. First of all, is 

that consistent with your conclusions? And that being the case, especially for the older and the sicker veterans, is this leaving a gap 

in the continuity of care? Are there patients greater than 19 percent that may be in need of extended care beyond the 90 day period 

of time? 

Ms. BASCETTA. That is a good question that I don’t have the answer to. These are some of the issues that we would like to pose 

for VA about what the basic need is out there and how well it is 

being met or not being met. Clearly, the kinds of continuity gaps 

that you are talking about are really problematic for filling the continuum of services that veterans in these situations need. And we 

know that the best health care outcomes are achieved when the 

transitions are smoothest between different care settings and different types of services. 

Mr. STRICKLAND. The second question, your analysis did not differentiate between the VA and contract settings and examining capacity. As you know, this committee has required the VA to maintain the capacity of its in-house programs. This is my question. Are 

the settings in VA, contract settings equivalent in your view? Do 

they tend to provide the same kind of care or the same quality of 

care? 

Ms. BASCETTA. We have not looked at quality of care. Perhaps 

the IG has a comment about that. We did note, particularly in the 

non-institutional area, that especially with our adjustment in the 

calculation of the home-based primary care, which is roughly equivalent to the skilled home health care that Medicare provides, those 

non-institutional services are overwhelmingly provided under contracts, not by VA’s own employees. But as far as quality of care, 

we don’t have any observations at this point. 

Mr. STRICKLAND. Thank you, Mr. Chairman. 

The CHAIRMAN. Thank you, Mr. Strickland. Mr. Stearns? 

Mr. STEARNS. Thank you, Mr. Chairman. Ms. Bascetta, how 

many years have you been an analyst on VA matters? 

Ms. BASCETTA. A little over 5 years now. 

Mr. STEARNS. Okay. What did you do before that? 

Ms. BASCETTA. I worked on Medicare and Medicaid issues for a 

while, and I spent about 6 or 7 years on social security disability 

issues. 

Mr. STEARNS. You are an expert as far as I am concerned. So you 

have had an understanding of the VA health and you have also 

studied Medicaid, I assume, you have a pretty good feel for that. 

The staff was kind enough to give me some statistics here. Bear 

with me. VHA is about a $30 billion program in operation. And 

they spend about $3 billion on long-term care. 

But, as I understand, Ms. Gong is going to testify that Medicaid, a $200 billion agency, spends about $75 billion on long-term care. 
16

So the VA is spending about 10 percent and Medicaid about 37 

percent. 

So the differences are pretty dramatic. Does that mean in your 

analysis that the VA is not spending enough or Medicaid is spending too much? 

Ms. BASCETTA. Well, we are talking about pretty different 

populations. 

Mr. STEARNS. This is long-term care. Isn’t long-term care longterm care? 

Ms. BASCETTA. Well, I don’t know what is included in the Medicaid long-term care numbers compared to the VA long-term care 

numbers in the sense that there are a lot of—— Mr. STEARNS. Well, you know what the components are for the 

long-term care for veterans, don’t you? 

Ms. BASCETTA. Yes. 

Mr. STEARNS. Okay. 

Ms. BASCETTA. But in the Medicaid population there might be a 

significantly younger population with chronic disabilities who are 

included in the $75 billion. 

Mr. STEARNS. I know but you and I both know populations, profiles of people who are in chronic need of long-term care is about 

similar, profile-wise, across the country. I think what you are trying to do is hedge because it is two different programs. I am just 

speaking in general here. We are not going to go down into the details of each patient here. We are just talking in general statistics. 

You have got 10 percent in the VA and 37 percent in Medicaid. 

Surely there has got to be something this tells you. 

If you had to decide on which, would you think the VA is using 

the dollars wisely or Medicaid, I mean from your analysis just give 

me a broad answer here, just yes or no? 

Ms. BASCETTA. Well, I wish I could. I am uncomfortable saying 

yes or no more on the VA side because I don’t know how well they 

are meeting the need in terms of efficiency. I don’t know whether 

the $3 billion is efficiently spent. I don’t know the answer for that 

on the Medicaid side either for that matter. 

Mr. STEARNS. Have you ever studied Medicaid? 

Ms. BASCETTA. Quite a while ago. Most of my Medicaid background is on the public health side, not on the long-term care side. 

Mr. STEARNS. Ms. Bascetta, in this whole room and probably in 

America, you are about as good an expert as anybody is going to 

be. There certainly is not going to be anybody with more experience 

than you. You have been an analyst 5 years on veterans. You have 

been on the Medicaid some time ago. I just call attention, Mr. 

Chairman, that the statistics here would show that the VA, at my 

first blush, that they should be spending more money on long-term 

care than 10 percent. 

Is that a fair statement, Ms. Bascetta? Do you think I am wrong 

saying that? 

Ms. BASCETTA. Well, I wouldn’t say you were wrong. 

Mr. STEARNS. That is okay, you can say I am wrong. 

Ms. BASCETTA. I would go back to my original concern about my 

own knowledge of what is in that Medicaid number. For example, 

one of the younger populations that are high utilizers on the Medicaid side are children and adults with mental retardation. 
17

Mr. STEARNS. That is a good point. 

Ms. BASCETTA. That is not in the VA population. 

Mr. STEARNS. That is a good point. 

Ms. BASCETTA. And I wish I knew, I wish I could tell you, maybe I could find out for the record what percentage of the $75 billion 

is spent on services like that. 

Mr. STEARNS. Well, let me move on. I have another question. 

This is a little bit of what Chairman Simmons has mentioned, that 

the state option is a bargain. He said, ‘‘The 1998 Long-Term Care 

Advisory Committee recommended VA hold steady on in-house 

nursing home beds and dramatically expand non-bed and homebased programs.’’ In fact, I put these recommendations in the Millennium Health Care Bill. The GAO reports the 85-plus age group 

has grown by 100 percent but the VA’s overall long-term growth 

was 11 percent. Why has VA’s non-bed programs not grown more 

since 1998? Do you understand the question? 

Ms. BASCETTA. Yes, and I think that that is a very important 

question to pose to VA because there does appear to be much less 

growth in the total combined workload of the institutional and noninstitutional services compared to the dramatic growth in the elderly population, that proportion over 85 who would be most in need 

of those services. 

A question for the future though, and something I also feel frustrated because I don’t know enough about is the capacity in the future to meet that need because what is different in VA than in the 

general population is that the other users of long-term care elderly, 

not younger people with chronic illnesses, but the other elderly 

component is those between 65 and 84. That component in the general population is growing very fast. But in the VA it is going to 

decline very steeply. 

So they may have sufficient capacity to meet the need of the 85’s 

and over or of the entire elderly population. We don’t know. These 

are the kinds of numbers we are trying to really press VA to 

produce for us so we can make some informed decisions about what 

they need to meet the needs in the future and whether they can 

do it with the resources they have now or whether we need to have 

a broader discussion about other funding streams. 

Mr. STEARNS. Thank you, Mr. Chairman. 

The CHAIRMAN. Thank you very much. I am going to have to 

leave for a moment but before I go on to Ms. Hooley, just make a 

point if I could and perhaps you might want to answer this. When 

Cliff Stearns’ bill became law, it set a minimum at the 1998 level 

for long-term health care capacity, not a maximum but a minimum, 

a floor. Many of us are concerned that that floor has been breached 

and would have been breached in a profound way had the previous 

budget become law. 

Perhaps you might want to speak to the issue. We shouldn’t be 

thinking in minimums when you talk about long-term health care. 

The $64 question that I had that I have not been able to get an 

answer to is what percentage of eligible veterans, who could utilize 

long-term health care, actually get it? Is it 5 percent? Is it 10 percent, who get it from the VA that is. 

And the second question is not unlike the first, and maybe in 

part not an answer but my sense of what is happening. The VA 
18

sees that Medicaid, especially with the spend down provisions, people spend their own money, and there is a spousal impoverishment 

provision so that the other spouse perhaps doesn’t become a pauper, although many times they do, but about 50 percent of those 

in nursing homes are on Medicaid. So in the way the VA has shifted the burden and responsibility that ought to be borne to a greater extent, maybe not wholly, totally, but certainly more to Medicaid. So I think Mr. Stearns’ question goes right to heart—— Mr. STEARNS. It is a good question. 

The CHAIRMAN (continuing). Where does responsibility and duty 

come in or you have finger pointing. But do we have a number, 

how many veterans who are eligible and who could be getting longterm health care are actually getting it? 

Ms. BASCETTA. I don’t have those numbers. Those are precisely 

what we need from VA to have exactly the discussion that we are 

talking about now. 

The CHAIRMAN. Ms. Hooley? 

Ms. HOOLEY. Yes, thank you, Mr. Chairman. And thank you for 

asking that question and for holding this hearing because those are 

critical questions that we need to have answered. 

Ms. Bascetta, I have a question for you. You stated VA’s longterm health care policy was post-acute nursing home care as a priority and then long-term care as resources permit. In your view, do 

the resources seem to permit VA to make long-term care available 

to many veterans? 

Ms. BASCETTA. Well, we know that the non-acute care is available to varying extents. What we don’t know is the sufficiency 

question that I believe you asked in your opening statement. 

Ms. HOOLEY. Right. 

Ms. BASCETTA. Because again we don’t have a good estimate of 

what is needed, and we are not able to match that need with services across different geographic locations. 

Ms. HOOLEY. Do you think we will have, be able to get those answers? 

Ms. BASCETTA. I certainly hope so. I don’t see why not. 

Ms. HOOLEY. Okay. Dr. Daigh, I have a quick question for you. 

I want to emphasize one point of your testimony. You say VA is 

contracting with providers that have significant violations, right? 

And those violations have been identified for Centers for Medicaid 

and Medicaid Services, CMS. Can you just check CMS’ website and 

find out if there have been violations, can you do that? Is it that 

easy? 

Dr. DAIGH. It is that easy and we are encouraging that people 

take that simple step and do that, yes. 

Ms. HOOLEY. My question is is this being done? 

Dr. DAIGH. It is not being done as routinely as we expected to 

see it being done. So the answer is some places did a nice job of 

it but many places did not take that simple step. 

Ms. HOOLEY. Do they all know they can look at that and get that 

information? 

Dr. DAIGH. Most of them did, yes. 

Ms. HOOLEY. And they still didn’t use it? 

Dr. DAIGH. It varied again by facility but it was not uniformly 

used. 
19

Ms. HOOLEY. Sometimes numbers are hard to predict things that 

are happening in the future, what the population is going to look 

like but it seems to me this is really an easy thing to do that we 

should absolutely be using when it is right there in front of us. 

Dr. DAIGH. We agree and when we went to look at the contract 

files at VHA facilities, we would have expected to find data like 

that in those files to consider reappointment or renewing the contract. And we didn’t see that as nearly as often we would have 

liked to have. 

Ms. HOOLEY. Okay, thank you, Mr. Chair. 

Mr. SIMMONS (presiding). Mrs. Davis. 

Mrs. DAVIS. Thank you, Mr. Chairman. 

I might just follow up, I think that the questions that people are 

asking in part is why don’t we have some of this information and 

how tough is it to get that? Do you think that—it sounds like the 

VA has really made greater use of its contract non-institutional 

care than perhaps developing its own resources. Is that a fair assessment? And if it is, do you think that—why do you think that 

is from your perspective? 

Ms. BASCETTA. Well, that is a fact. Whether or not that is a wise 

use of their own resources is an open question because we haven’t 

looked at what the relative costs would be of them trying to provide 

that service through their employees. It could very well be that the 

most efficient thing for them to do is to contract those services, particularly in markets where those services might be plentiful. Maybe 

they can get a very good deal. 

Mrs. DAVIS. There hasn’t really been an attempt to really analyze that, whether it is rural, whether it is more urban? 

Ms. BASCETTA. We are continuing our work and certainly looking 

at the cost-effectiveness of the current delivery patterns is something we would want to look at. 

Mrs. DAVIS. You also mentioned the mental health area, which 

is critical. And from your perspective again, we know that that is 

a great need. Is there a sense that this is really from a development point of view in terms of growing our own essentially, in 

terms of having the people available, the training, et cetera. 

Do you see a growth in our ability to respond to that or has that 

been kind of on a flat plain, have we not really addressed those 

issues in a way that obviously the population would suggest? 

Dr. DAIGH. That wasn’t one of the questions we looked at in the 

study but the sample population clearly had significant psychiatric 

issues in terms of the incidence of psychiatric disease. And it 

makes it very difficult to provide care in any setting for those patients and was probably the most important complication of providing care to this population. I can’t directly answer your question 

based on the questions we asked when we did our review. 

Mrs. DAVIS. I guess going back in terms of the issues around 

Medicaid and again developing those resources, the percentage of 

resources that is put into that would also be helpful to know. Did 

I get a sense that you are having such difficulty getting this information? And why is that? Perhaps we will hear in the next panel 

but what is the problem? 

Ms. BASCETTA. Would you like to comment? 
20

Mr. MUSSELWHITE. We have had difficulty getting information. I 

am not sure what the problem is but there are inconsistencies in 

data that are provided sometimes between data from headquarters 

and data from a network prospective, for example. Just to give you 

an example, in the nursing home workload, we asked networks as 

well as the headquarters folks what the average daily census numbers were for the various years and there were discrepancies which 

we had to work out. And why all that happened, I can’t exactly tell 

you. Some of the issues are just sort of normal data issues that 

occur but others, for example, one network thought that maybe 

they had not input all their data that would count all the people 

who had been in nursing homes over a given period. 

So it is a question in many cases of looking for documentation 

to understand how the information is gathered. For example, in the 

home-based primary care side, we just asked for documentation as 

to how those numbers were calculated. And when we did, that is 

when we understood that they are based on enrolled days, not the 

number of visits that a patient receives. So we went through the 

process with all the non-institutional services and for all the other 

services, it is on the basis of visits. 

So we really had to get behind the numbers to see how they were 

calculated. For example, on home-based primary care, you might 

want to ask VA why they have done it based on enrolled days. I 

can’t answer that. But we tried to be consistent, once we understood how the data were calculated, we put them all in the table 

the same way and it is a different number total than the one VA 

reports. So it takes a bit of getting behind the numbers to figure 

out what is going on. 

Mrs. DAVIS. Appreciate your work on this. Thank you. 

Mr. SIMMONS. The gentleman from New Hampshire, Mr. Bradley, is recognized. Mr. Baker? It is a conspiracy against Republican 

members. 

OPENING STATEMENT OF HON. RICHARD H. BAKER 

Mr. BAKER. Yes, I am accustomed to this treatment, Mr. Chairman. In looking at the data provided in Network 17 relative to the 

increase in utilization, it is a rather staggering jump in relation to 

the performance of the network generally where by far and large 

most demonstrated in a decrease while Network 17 was up some 

42 percent, twice it is close to second place finisher. I understand 

that Texas is engaged in significant new construction activities for 

several new facilities now on line with more company. Then looking 

at the VA’s home workload declines, Network 17 had the most significant decrease in workload provided by VA-operated nursing 

homes. It appears that there has got to be some policy observation 

arrived at. 

Well, in addition, the community nursing home load was also 

down in Network 17. In your conclusions, one of the questions 

posed is what are the implications for access, quality, and cost of 

VA significant shift using state veterans nursing homes to provide. 

My point is that Texas is appearing to create a very interesting 

policy question for us. If there is nothing the Congress has done to 

initiate Texas’ unilateral action, and it is merely a policy deter-
21

mination of the state legislature, we need to be more engaged in 

nursing home provision. 

What does that say to us about the direction of long-term nursing facility care? Do we need to be concerned about the proliferation of state facilities at the expense of free enterprise communitybased institutions? Does it have good implications for the VA-operated facilities? Out of all of this work, what conclusion can you 

draw or observation can you make about the advisability or inappropriateness of that step because it is going to get significantly 

more disparate because there are more facilities coming on line. 

Are you worried about that? 

Ms. BASCETTA. Correct. 

Mr. BAKER. Are you happy about that? Don’t care about that? 

Ms. BASCETTA. Well, we don’t know enough about the implications across the board, cost, quality, and access, to know whether 

we are happy about it or not or whether we are happy in some 

places and not in others. 

Mr. BAKER. Well, if you could maybe without getting overjoyed 

but reach a conclusion at some point because if we don’t, with 

Texas doubling their capacity, they are dictating to us how the system is going to function. And there may be advisable directions or 

steps that we should take based on professional analysis of these 

implications. So I just request, Mr. Chairman, that some observations or recommendations be made about this implication. It clearly 

in the view of the overall network performance is an aberrant act. 

And I don’t know whether it is good or bad either, but I would like 

to have somebody who knows more about it tell me. Thank you. 

Ms. BASCETTA. We agree, thank you. 

Mr. SIMMONS. I thank the gentleman. Before I excuse the first 

panel, and I believe everybody has had a chance at questions, I 

would like to address a question to Ms. Coates, who I understood 

flew up from Atlanta, in the heart of the storm. It is my understanding that in December 2003, your evaluation of the VA Homemaker and Home Health aide Programs noted that about $10 million could have been available to provide needed services to veterans if VHA had implemented previous IG recommendations. Is 

that a correct statement? How did you come up with that figure? 

And what comments would you like to make on that subject? 

Ms. COATES. We had an audit division that assisted us in developing the financial figures. I have a general picture of how those 

numbers were developed, I would be happy to share those. But 

something specific, I would probably need to get back to you on. 

Mr. SIMMONS. If you could do that for the record, we would appreciate it. And we also appreciate your coming up under these difficult conditions. Thank you very much. Unless there are any additional questions for panel one, I want to thank them for their testimony and participation. And in the case of the GAO, we look forward to a continuing relationship to answer some of the questions 

that we have posed. 

At this point, I would like to welcome panel two, which is composed of the honorable Robert H. Roswell, Under Secretary for 

Health, Department of Veterans Affairs, accompanied by Dr. James 

F. Burris, who is the chief consultant for geriatrics and extended 
22

care of the Strategic Healthcare Group, Veterans Health Administration, Department of Veterans Affairs. Welcome, gentlemen. 

Dr. Roswell, you know the routine and I am sure you have a 

statement for the record. We would welcome that. If you want to 

summarize that or plunge into some of the issues that have already 

been raised, I leave that to your discretion. 

STATEMENT OF ROBERT H. ROSWELL, M.D., UNDER SECRETARY FOR HEALTH, DEPARTMENT OF VETERANS AFFAIRS; ACCOMPANIED BY JAMES F. BURRIS, M.D., CHIEF 

CONSULTANT FOR GERIATRICS AND EXTENDED CARE, 

STRATEGIC HEALTHCARE GROUP, VETERANS HEALTH ADMINISTRATION, DEPARTMENT OF VETERANS AFFAIRS 

Dr. ROSWELL. Well, thank you, Mr. Chairman. I would like to 

make an opening statement, although it will be abbreviated. My 

full statement has been submitted for the record. 

I am certainly pleased to be here to discuss some very important 

issues that have already surfaced and a topic that is very near and 

dear to my heart. With me is Dr. James Burris, our chief consultant for geriatrics and extended care. I would like to say that Jim 

joins us after a lengthy hiatus in leadership in the Office of Geriatrics and Extended Care. It has been over 18 months since the 

previous chief left. During that time, we functioned with an interim 

acting chief, a woman who dedicated her life to caring for the nation’s veterans and particularly for long-term care. Sadly, she was 

struck with a terminal illness and has departed VA and is no 

longer with us. But I would like for the record to acknowledge the 

tremendous leadership that Marsha Goodwin-Beck provided as the 

acting director of geriatrics and extended care and someone who, 

as I said, devoted her life to improving the care for veterans. 

Mr. Chairman, the need for accessible long-term care for services 

cannot be overstated. As has been mentioned, by the year 2010, the 

number of veterans over age 85 will triple to more than 1.3 million. 

And in comparison to the general population, VA patients are 

older, with lower income, lacking health insurance, and much more 

likely to be disabled and unable to work. 

VA remains fully committed to providing institutional long-term 

care for eligible veterans who require this level of service. However, 

we must recognize that this type of care is costly and is likely to 

impair longstanding relationships with friends and family and reduce the overall quality of life. Accordingly, veterans have indicated a preference for care in non-institutional settings where possible. And when it becomes necessary, institutional care as close as 

possible to their homes. 

VA has responded to the veterans’ desires in several ways. First, 

we have emphasized rehabilitation care and functional restoration 

in VA nursing homes. This not only improves the cost efficiency of 

acute care services by shifting post-acute care to a lower cost environment but it has also led to sufficient patient improvement for 

those cared for in our VA nursing homes to allow over 70 percent 

of veterans treated in that setting to be returned and be discharged 

to their own residences. This emphasis on restoration of functional 

independence has resulted in shorter average lengths of stay in VA 
23

nursing homes, allowing more patients to benefit from this 

approach. 

From 1998 through 2003, the number of patients treated annually in VA staff nursing homes has actually risen from 47,000 to 

almost 56,000 patients, an 18 percent increase, despite the fact 

that the average daily census has fallen slightly from 13,391 to approximately 12,000. 

When veterans eventually require maintenance care in an institutional setting, we have emphasized the availability of state veterans homes which allow veterans and their families greater choice 

in the location of care. From 1998 to 2003, the average daily census 

of veterans receiving care in state homes and domiciliaries has 

risen from 18,000 to over 20,000, a 13 percent increase. 

Newer models of long-term care now include a full continuum of 

home and community-based extended care services in addition to 

home care. VA expects to meet most of the need for long-term care 

through CARE coordination, home health care, adult day health 

care, respite and homemaker and home health aide services. VA 

has made steady progress in expanding its own home and community-based extended care programs. From 1998 to 2003, the average daily census in these programs increased from 11,700 to 

18,322, a 57 percent increase. VA plans to reach an average daily 

census of 22,000 in fiscal year 2004. And our new CARE coordination program will add to that number approximately 7,500 more 

veterans for a total of almost 30,000 veterans by the end of this fiscal year. 

Last May, I announced plans to establish the Office of Care Coordination, and I am pleased to report that that office is now fully 

operational. Care Coordination uses best practices derived from scientific evidence to bring together health care resources in the most 

appropriate effective and efficient manner to care for the patient. 

CARE Coordination provides patients a continuous connection to 

clinical support services from the convenience of their place of residence and supports the family members and others who provide 

care in the home. Initial efforts in Care Coordination are focusing 

on high resource utilization patients with chronic diseases at great 

risk for nursing home placement. 

On a needs basis performed last year, we anticipated that each 

VISN would have at least 1,000 to 1,500 patients who could benefit 

from such services. The emphasis on these programs to support 

non-institutional care of veterans and promote their independent 

living will result in an average daily census in our CARE Coordination which has grown from 2,000 in fiscal year 2002 to over 7,000 

this year. 

Mr. Chairman, we have had an opportunity to review GAO’s 

draft statement for the hearing and discuss it briefly with them. 

We feel the GAO’s findings emphasizes the need to capture data 

more accurately reflecting the services that we actually provide to 

veterans. While average daily census serves as a useful planning 

and budget tool, it does not truly reflect the great number of individuals who receive and benefit from the various services we are 

privileged to provide. 

In conclusion, Mr. Chairman, VA has made great progress in increasing the number of veterans who receive needed long-term care 
24

services. Today, veterans have more options in more locations 

which allow them to achieve their full functional independence potential and still maintain a satisfying quality of life. 

Mr. Chairman, that completes my opening remarks. Dr. Burris 

and I would be happy to answer any questions you may have. 

[The prepared statement of Dr. Roswell, with attachment, appears on p. 146.] 

Mr. SIMMONS. Thank you for your testimony. I accept your statement that there are more options available for long-term or chronic 

care. We have moved from an institution-based system to I guess 

what you could call a patient-based system. You have options that 

are available through your state homes, which we have discussed 

a little bit. You have options through local nursing homes that 

would then receive payments from the VA to provide services. And 

you have home health care options, which involve I think distance 

communication so that patient health can actually be monitored at 

some distance from the home with the assistance I guess of a family member. 

So I see a variety of options there that I think is important. The 

fundamental question I have is how is the VA monitoring these options to ensure quality across now a very broad and diverse spectrum of service providers? And how is the funding going so that we 

know that you are getting more bang for the buck? We know that 

if you were to provide this service in-house, it would cost almost 

10 times as much as what it costs in a state home. And I guess 

there is a 30 percent saving if you out source to a private nurse 

care facility. 

So I am interested in following the dollars, if you will, and interested in how you follow the dollars to ensure that these veterans 

get the long-term care that they need? 

Dr. ROSWELL. Well, Mr. Chairman, as important as the dollars 

are, much more important are the veteran and the desires of his 

or her family members. Having said that, we are very scrupulous 

in monitoring the dollars. The VA staff nursing home beds that I 

spoke of on average cost about $400 a day. That higher cost reflects 

the rehabilitation services that are provided, which leads to the 

shortened stay. 

But much more important than the shorter stay is the fact that 

we are actually able to return veterans seven out of 10 times back 

to their homes, where they are functionally independent for at least 

a period of time. The contract community nursing homes on average cost about $200 a day, roughly half that, a substantial savings. 

Let me point out, though, in response to one of the earlier questions, that the reality of the contract community nursing home is 

that it is a transition program towards Medicaid-provided longterm care. Medicaid, as was discussed, devotes a large percentage 

of their budget, 37 percent, to long-term care in institutional settings. VA devotes less than that. 

But let me point out that we don’t even count veterans who 

choose (or their families choose) to receive care through that venue. 

We do assist them, though, in ascertaining Medicaid benefits if 

that is their desire to move to a Medicaid provider in their community. When we place a veteran on a contract, we will do so only 

with homes who pass a very rigorous inspection. When they fail to 
25

pass that inspection, when they fail to meet CMS certification, we 

withdraw patients from that contract. We are more efficient than 

we once were in ascertaining those Medicaid benefits on behalf of 

our patients and therefore the average length of the contract is 

shorter. But it doesn’t mean fewer patients are receiving care. 

With regard to the state home, as Ms. Bascetta indicated, VA 

provides 65 percent of the cost of construction and in exchange provides for veterans a discounted per diem of a little over $50 a day, 

a substantial savings. So we have gone from $400 to $200 to zero 

cost for Medicare beneficiaries to $50 for those who seek care in 

state homes. Again, state homes often are a preference for veterans 

seeking care in their community. State homes are in many locations that VA nursing homes aren’t, and we try to honor the desires of the veteran. We work with the state homes to make them 

more efficient, to achieve discounts on pharmaceutical services. 

One of the things that we have considered in the past is paying 

the full per diem cost, not the discounted per diem cost for veterans 

who are 70 percent service-connected or greater who desire care in 

a state home. I might point out that that is the only veteran group 

that this Congress has seen fit to offer full access to long-term care. 

The eligibility reform legislation, which became effective in 1998, 

makes institutional long-term care services a discretionary benefit. 

It is not part of the uniform benefit. 

The Millennium bill that Mr. Stearns co-authored and spoke 

about adds non-institutional long-term care services to that uniform benefit, but institutional long-term care is still mandated only 

for those 70 percent service-connected. By extending that benefit to 

the service-connected veterans, we might be able to further improve the budgetary issues that the state homes are dealing that 

have been alluded to. 

And then I haven’t any mentioned long-term care which is provided in a non-institutional setting. There we are literally providing care at a cost of only a few dollars a day. So there is a substantial savings. Obviously, though, it is not the dollars that drive 

that; veterans repeatedly tell us they would much rather be at 

home than in an institutional setting. 

Mr. SIMMONS. Thank you. I see the red light. I have some additional questions, but I thank you for that response. Mr. Strickland, 

the acting ranking member? Oh, Mr. Michaud, I apologize. 

Mr. MICHAUD. I switched seats here. 

Mr. SIMMONS. He is moving on me, okay, I apologize. 

Mr. MICHAUD. I am moving on you. I am moving further to the 

center. 

Mr. SIMMONS. That is good. 

Mr. MICHAUD. The question is, a couple actually, Congress recently received a final report from VA on implementation of the 

Millennium bill and it says, and I quote, ‘‘To date, there is evidence 

of at most only small changes in VA long-term care services occurring immediately after enactment of Public Law 106–117 compared 

to what has been expected in absence of the law.’’ What this says 

to me is that VA had decided to create policy regardless of what 

the law says or what the intent of the law says. 

And I guess I have a concern, particularly being a public official 

for 22 years in the State of Maine where bureaucrats tend to do 
26

whatever they want to do regardless of whatever the intent or 

what the law actually says. I would like to have you comment. 

Dr. ROSWELL. Well, I think VA is being responsive to the Millennium bill. I apologize that we can’t be more timely in our response, 

but I think good care and honoring the choice of veterans and their 

families requires time for implementation. Let me ask, if I may, 

though, Dr. Burris to provide some specific comments on that. 

Dr. BURRIS. Thank you, Dr. Roswell. Prior to the passage of the 

Millennium Act, we had a series of recommendations from the Federal Advisory Committee on the future of VA Long-Term Care. VA 

began to take action on a number of those recommendations even 

before the passage of the Millennium Act so that from my point of 

view you would expect the outcomes not to be too different because 

VA and Congress were thinking very much in the same way about 

what the future of long-term care in VA should be. 

In particular, the Crossroads Report, the Report on the Future 

of VA Long-Term Care, recommended that VA sustain its own 

nursing home infrastructure and the community nursing home program but that most growth in nursing home care should be in the 

state home program. And that is exactly what we have done. The 

Crossroads Report also recommended that we shift much of the 

care from institutional to non-institutional home and communitybased settings. And, as you have heard, that is exactly what VA 

has done. 

So the fact that we were just thinking alike explains in part that 

there wasn’t a lot of difference between the direction VA was going 

before and after the passage of the Millennium Act. And in part 

what Dr. Roswell said just a moment ago that it takes time to develop the infrastructure and hire the staff and build the facilities 

to make the care available. 

Mr. MICHAUD. I think it talked about maintaining but also to expand. I guess, Dr. Roswell, this committee recommended an additional $297 million for long-term care in our views and estimates 

for the fiscal year 2004 budget. Ironically, VA returned about $270 

million to the U.S. Treasury for fiscal year 2003 and left many of 

Congress’ long-term care capacity concern still unaddressed. Can 

you explain? 

Dr. ROSWELL. I am not sure which money you are referring to 

that was returned to the Treasury. But let me point out that we 

are expanding both institutional and non-institutional long-term 

care. When we look at the number of veterans who receive and 

benefit from those services, the expansion of institutional care is 

fairly significant even though the average daily census in the highest cost level of care that the chairman asked about has been relatively static or actually declined ever so slightly. But the number 

of veterans who received those services in institutional settings either provided directly by or administered through VA has 

increased. 

Mr. MICHAUD. I have several questions I would like to submit in 

writing but my last question is the American Legion says, ‘‘The key 

to fulfilling VA’s obligation to provide long-term care to veterans is 

to obtain mandatory funding for veterans’ health care.’’ Do you 

agree with that? And, if not, why not? 
27

Dr. ROSWELL. I believe that the congressional process of oversight applies equally well to the formulation of budgets. I am not 

sure that a formula can substitute for the judgment of this Congress in determining what the budgetary needs of the Department 

are. So the Department has examined the interest in mandatory 

funding carefully, but we still believe that health care is not predictable by a formula and value the oversight that this Congress 

provides. 

Mr. SIMMONS. I thank the gentleman from Maine. As I hear that 

response, I think it means that they value our background and experience in dealing with these issues on a year to year basis. 

The Chair recognizes the gentle lady from Nevada, Ms. Berkley. 

Ms. BERKLEY. Thank you, Mr. Chairman. When it comes to veterans’ issues, I would rather be called the ‘‘not-so-gentle lady from 

Nevada.’’ Dr. Roswell, it is a pleasure to see you again. I am sorry 

that I am a little late to the hearing. It seems that everyone that 

lives in Nevada is in our nation’s capital today in my office. So I 

had to attend to my responsibilities to the folks back home. 

If I could, would you mind if I entered some remarks into the 

record, since I wasn’t here for opening statements? 

Mr. SIMMONS. Without objection, so ordered. 

Ms. BERKLEY. Thank you for that. Dr. Roswell, you know these 

statistics probably better than I do at this point, and I don’t mean 

to sound like a broken record but I would like to include them in 

the record if that is all right with you. For the last 17 consecutive 

years, Nevada has been the fastest-growing State in the nation, 

and the majority of the growth, of course, has been concentrated 

in southern Nevada, which is Las Vegas, NV, the community that 

I represent. Few communities face a greater need for veterans’ care 

facilities than Las Vegas, home to one of the fastest growing senior 

populations and the fastest growing veteran population in the 

United States. A large number of my Las Vegas seniors have 

served their Nation in uniform, and they are turning to the VA in 

even greater numbers for outpatient treatment, hospital visits, 

nursing home care, a need that is growing particularly acute, as 

you know. 

To help meet the demand for long-term care, the Nevada Veterans Nursing Home in Boulder City opened in August of 2002 

with 180 beds. Those beds are long since filled. We are at capacity 

there already, of course. It is the only one of its kind in the entire 

state of Nevada. It is 30 miles away from metropolitan Las Vegas. 

And it is difficult—if there were beds available, it is still difficult 

for my seniors to access it without a burden to those that have 

family in Las Vegas, which are few. Two years after opening the 

doors, the facility is filled, and we estimate that this trend will continue over the long term. 

I am concerned for a whole host of reasons. One is that the existing lack of nursing home beds in Las Vegas and the expected demand for long-term care in the future will continue to strain the 

available resources for veterans in southern Nevada. We have a crisis in our private nursing facilities so whenever the VA is able to 

get a veteran into a private nursing facility, it is at the expense 

of other people, other seniors that are on a very long waiting list. 

That is not a viable option. Home, non-institutional settings often-
28

times in the State of Nevada, in Las Vegas is not an option either 

because so many of our veterans move to Las Vegas after they retire and there is no family member there to help them. So they 

need institutional care. 

The CARES plan recognized the needs of the aging veterans population and proposed a long-term care facility with 120 beds in Las 

Vegas as part of a full service medical complex and you know we 

are anxiously awaiting that. This proposal is a major breakthrough 

in health care services for southern Nevada’s veterans and will 

make long-term care more accessible to our aging veterans and 

their spouses. It will not only provide Nevada with desperately 

needed nursing home care beds but will address current and future 

demands for nursing home specialized care and expand necessary 

services, such as Alzheimer care, rehabilitative and sub-acute care. 

I am concerned—as you know, this is an issue that I spend a 

great deal of time on and it is a tremendous passion for me. Under 

the Veterans Millennium Health Care and Benefits Act, I think 

Congress mandated that the VA have 13,500 nursing beds available. But from what I understand, there are less now available 

than before. How does that impact on a community like mine that 

is so growth-oriented? I have 5,000 new residents a month coming 

into town; many of them are seniors, many of them are veterans. 

This is not going to stop. And if the VA is cutting back on the mandate, and I hate to use that word, but if it is in the bill, it is in 

the bill, the 13,500, if we are cutting back, what does that do for 

a growing community like Las Vegas with absolutely no veteran 

long-term care facility? 

Dr. ROSWELL. Well, I certainly agree with the proposal that I 

crafted into the National CARES plan, which is now in the final 

stages of review by the independent CARES Commission. The bottom line is that the 13,391 in the Millennium bill is actually an average daily census in the existing VA nursing homes. 

Part of the premise of CARES, part of the premise of the way 

we are looking at the growth and changes in the veteran demography nationwide is that our facilities aren’t where there is the 

greatest need. And some of the facilities as they currently exist are 

woefully outdated. There is no question that in southern Nevada 

the population growth and the veteran growth is so great that we 

will need to place additional nursing home beds in that location. 

In addition to all that you have stated, it will also improve the 

efficiency of the hospital care that we will provide in that location. 

And it will allow us to provide respite care for veterans who are 

able to be cared for in the home even though that may be a smaller 

percentage than the national average. It will allow us to provide 

geriatric assessment to help us identify ways that we can maximize 

the quality of life for veterans who need geriatric care but may not 

yet be ready for institutional care. 

So in addition to all the benefits you provided, those long-term 

care beds will be a part of a full-service medical center, which is 

what is truly needed to serve the population of southern Nevada. 

Ms. BERKLEY. Can I ask a follow-up question? 

Mr. SIMMONS. Of course. 

Ms. BERKLEY. Thank you. Let me ask, I am a little bit concerned 

about the direction that the CARES Commission is going in, be-
29

cause they are talking about shared facilities at Nellis Air Force 

Base. You and I envision, not only you and I, but we envision an 

entire campus where we have got the outpatient clinic, a full-service hospital, and a long-term care facility on a 50-acre parcel. If the 

CARES Commission decides to go with this idea of sharing facilities at Nellis Air Force Base, what does that do to the whole campus environment and what does that do to the potential for our 

long-term care facility for our veterans? Am I going to have that 

in one location and the hospital in another location and my veterans going to 10 different locations to get outpatient care? Where 

are we going with this? 

Dr. ROSWELL. I could only speculate. Let me tell you that there 

is interest in maintaining the excellent collaboration VA currently 

enjoys with the Air Force at the Michael O’Callaghan Federal 

Hospital——

Ms. BERKLEY. Whose definition of ‘‘excellent?’’ It is not my veterans’ definition. 

Dr. ROSWELL. ‘‘Excellent’’ was my word. We recognize, though, 

that our needs are for a full-service medical center, which includes 

an outpatient clinic to replace the one that was so seriously damaged due to structural flaws. We need additional inpatient beds. 

The beds at the Michael O’Callaghan, even if all were made available to VA, would be inadequate to our needs. And we need longterm care beds. We also need a VA regional office for benefits administration to allow us to enhance the processing of disability 

claims in that area. 

So we have a significant need. Yes, we probably need 50 or 55 

acres to provide those full services. We are currently working closely with the Air Force. Secretary Principi has written Secretary 

Roche asking him for his assistance in identifying an adequate 55-

acre parcel of land that would still allow joint operations but would 

meet our full needs. We are anxiously awaiting the reply to that 

letter from the Secretary of the Air Force. 

Ms. BERKLEY. I would suggest Yucca Mountain—instead of nuclear waste, we put the VA facility on that. 

Mr. SIMMONS. I thank the lady. My recollection is Yucca Mountain is a former nuclear test site, so I am not sure the veterans 

would appreciate that. 

Ms. BERKLEY. No, actually it is not exactly at the Nevada test 

site, but I am sure they would not appreciate that. 

Mr. SIMMONS. The gentleman from Ohio, Mr. Ryan, is recognized. No questions. Okay, if I could begin the second round, I have 

two questions. As a follow-on to my previous questions about funding, and my interest in this is not to reduce funding or to look for 

efficiencies necessarily but simply to see if there are areas where 

the funding goes astray. When the VA makes a payment to a state 

home or to a nursing home in a state, does that payment go either 

to the general fund or to let’s say a Department of Health Services 

fund where it is then re-allocated to the provider? Or does it go directly from VA to the provider? That is the first point. And secondly is there any situation that occurs where the state veterans 

home or the providers might have excess funds which they then return back to a general fund in a particular state? 
30

Dr. ROSWELL. We are not entirely sure. We will submit a more 

complete answer for the record. But I believe the money is provided 

to the state on behalf of the nursing home. It is not realistic in my 

mind that there would ever be any excess funds from the administration of a state home to turn back into the general fund of the 

state. I certainly don’t think states see this as a revenue source. 

We recognize that the per diem payments we do make constitute 

only a small portion, roughly a third of the total per diem cost. And 

that is exactly why we are trying to enhance our partnership with 

state home directors and state directors of veterans’ affairs to look 

at collaborative ways we can improve the efficiency of the operation 

through sharing agreements such as provision of pharmaceutical 

services. 

I also think there is another innovative model of care that the 

committee might want to look at. Albeit it is a substantially lower 

per diem payment, state domiciliary could be a source of care that 

would allow concurrent enrollment in VA outpatient care programs, 

which would allow veterans to receive outpatient care and pharmaceutical benefits concurrently with the domiciliary per diem payment. This is not permissible when a veteran is in the skilled state 

nursing facility. I think that venue of care could then be coupled 

with the care coordination technologies that we are currently using 

that I spoke of to monitor care in that location. 

We have actually administered such a model at one state 

domiciliary in Florida and found it to be a very, very successful 

way to monitor patients in an even lower cost, less-skilled facility 

but still provide very high quality care and monitor medication 

complications. 

Mr. SIMMONS. I would like that follow-up on the funding. I think 

other programs from time to time grants are made to states that 

they may have charged some sort of an administrative fee as the 

dollars move forward. So I would be interested to know how it 

works with VA. 

Moving to a more general question, we have already said for the 

record that there has been 100 percent increase of the veteran population most in need of long-term care over the last few years. That 

is those veterans 85 and older. It is my understanding that the 

funding to deal with those veterans has only increased by about 11 

percent. That figure may not be correct. And the total number of 

beds available in the VA itself have actually gone down. Now that 

may be explained by finding other venues. But with 100 percent increase in the population and looking to almost double that over the 

next 10 years, do you feel the dollars are increasing adequately to 

meet those costs? 

Dr. ROSWELL. It is certainly something that is a very great concern of mine and it is a high priority within the Department. Let 

me point out though that age alone is not a determinant of institutional nursing home care. That is why we are working so diligently 

as we speak to develop this long-term care projection model that 

as yet has not been developed. But it is clear in the medical literature that as more and more Americans reach older age, the 

level of disabilities are not as great as what we anticipated based 

on earlier literature. 
31

Said differently, veterans who are age 85 in fact in many cases, 

because they have been beneficiaries of better care, better management through their earlier years, may not have the level of disability that requires skilled nursing home care. And that has to be 

a factor in how we project long-term care needs. Clearly, budget, 

though, is a major driver and it is something that we will continue 

to follow very closely. 

Mr. SIMMONS. Thank you. The gentleman from Maine, Mr. 

Michaud. 

Mr. MICHAUD. Thank you, Mr. Chairman. It seems to me that 

Congress has expressed its will pretty clearly that Congress wants 

VA nursing home beds that were operating in 1998 to remain 

available for long-term care. The administration has asked us to 

consider counting state and community nursing home beds in addition to the workload in non-institutional settings in its calculation 

of maintenance of capacity and Congress has refused that. 

Will the administration request this permission again? And what 

specific steps will you take as a VHA leader to ensure that VA 

restores its bed levels in the event Congress continues to refuse to 

allow states and contract beds, among other services, to be 

counted? 

Dr. ROSWELL. Well, of course, I am not at liberty to speak about 

the President’s 2005 budget request. We anticipate that, though, 

and would be happy to respond at the appropriate time. 

With regard to our historical request, I feel very strongly that my 

role is to advocate for veterans. And veterans tell me time and 

again that they want to be cared for as close to their family members as possible. Veterans don’t want care in an institutional setting if it can be avoided. We have listened to that. We have tried 

to respond to that. When institutional care is unavoidable, then 

veterans and their family members want it to be as close to their 

homes as possible. We have a finite number and will always have 

a finite number of VA staff nursing home locations. 

By working with contract community providers and working with 

state homes where we have had a significant number of new locations over the past several years, we have actually created and enhanced the choices for veterans. And I believe that is a good thing. 

And I believe that combining the 1998 aggregated census between 

those three levels of CARES, and looking to make sure that we 

maintain at least that level of institutional care, allows us to offer 

veterans a greater choice in how and where they receive long-term 

care. 

Mr. MICHAUD. It is clear that in some of the recommendations 

in National CARES draft plan could have implications on VA’s requirement to maintain bed levels at the 1998 levels. What step will 

you take to ensure proposed closures do not further erode the longterm care bed availability in the VA setting? 

Dr. ROSWELL. We have been adamant in the formulation of the 

individual VISN market plans, which were aggregated to form the 

National CARES plan, to preserve the current level of long-term 

care beds. There is no question in my mind that we will need additional long-term care beds. But CARES is about capital assets. It 

is not about long-term care. 
32

And time and again experience has shown us that taking a 50 

year old hospital and attempting to convert it to provide long-term 

care winds up costing a lot more than new construction, and the 

end result is a renovated 50 year old hospital that is still not properly designed to meet today’s standards for long-term care. 

So an over-arching principle in the formulation of the CARES 

plan is maintain our current long-term care bed capacity but recognize that if we have additional needs, we will meet those with new 

construction because it is less costly. It gives us greater flexibility. 

It is more timely. And it affords a higher quality of life for veterans 

who would receive institutional long-term care. 

Mr. MICHAUD. You had mentioned in your earlier comments that 

you view your role as advocating for veterans. In that role, when 

you deal with the budget, have you adequately requested the appropriate funding level to take care of veterans? And, if so, has the 

administration granted your request that you have requested? And, 

if not, how much have they cut it by? 

Dr. ROSWELL. I believe that the budget requested by the administration has been adequate to meet the—— Mr. MICHAUD. No, my question was in your request for funding, 

since you advocate for veterans, has your Department granted your 

request for the funding that you asked or did they cut it back? I 

am talking about your request. 

Dr. ROSWELL. My personal request? 

Mr. MICHAUD. Yes. 

Dr. ROSWELL. Yes, I think it has been met. It is—— Mr. MICHAUD. So they granted everything you have asked for? 

Dr. ROSWELL. We have had discussions about how best to formulate the budget but let me point out that Secretary Principi doesn’t 

formulate the budget personally. He draws upon my counsel as he 

crafts that. And I think he has been very receptive to the input I 

provided on long-term care. He has become a true believer, I would 

say I am reluctant to speak for him—but I think he really has become a true believer in the benefits of non-institutional care. And 

we believe that the budget we have crafted for the Department will 

meet those needs. 

Mr. MICHAUD. So I take by your jumping around a simple yes or 

no answer that they have not granted your full funding request 

that you have asked? 

Dr. ROSWELL. If I had to say yes or no, I would say yes, they 

have granted it. 

Mr. SIMMONS. The gentleman from Ohio, Mr. Ryan. 

Mr. RYAN. Thank you very much. I apologize for not being here. 

It has been a busy day. Some of the discussions, as we were just 

talking about, had to do with your long-term care model. For those 

of us who are new to the committee, can you explain to us a little 

bit about other than nursing home beds, what is the process in determining what the needs are for this long-term care model? 

Dr. ROSWELL. One of the biggest advances to our geriatrics program has been what we call the GEM Program. It is a gem. But 

it actually is Geriatrics Evaluation and Management that allows a 

full inter-disciplinary assessment. Let me ask Dr. Burris how that 

process works and how it determines a wide range of needs that 

can be met through our geriatric services. 
33

Dr. BURRIS. Let me just clarify. Were you asking about how we 

structure the long-term care planning model or were you asking 

about how we refer individual patients to the level of care that they 

require? 

Mr. RYAN. I would like to know how you gather the information, 

how you determine what your long-term needs are as with the 

nursing home beds. 

Dr. BURRIS. The process is modeled after the utilization of nursing home care and other long-term care services (the home and 

community-based services) in the Medicare/Medicaid population adjusted for the characteristics of the veteran population. 

And included in the long-term care planning model that is now 

under development, in addition to that basic data, there will be 

trending of the changes in disability among elderly people that Dr. 

Roswell referred to, that is that older people are less disabled now 

and the rate of disability has been declining at about 1 to 2 percent 

per year over the last decade. 

So that will be taken into account. The marital status of the veteran will be taken into account, again trended over time because 

veterans who have a spouse are less likely to require institutional 

long-term care than those who are living alone in the community. 

We will also be looking at the gender differences. As women are 

composing a greater part of the veteran population, they have different utilization rates for long-term care services than male veterans do. 

So all of those factors will be taken into consideration in the development of the long-term care planning model. 

Mr. RYAN. When would we get this information? When is the 

time frame for us to have all this information? 

Dr. ROSWELL. That model is still under development. We would 

anticipate that shortly after the CARES plan is communicated, we 

will then be able to focus on the specific aspects of that model and 

bring it to completion. 

Mr. RYAN. When is that? 

Dr. ROSWELL. We anticipate that the Secretary’s recommendations on the CARES Commission Report would be available some 

time in mid-March. 

Mr. RYAN. So we can expect this information in mid-March? 

Dr. ROSWELL. No, that information would be coming after that 

time but certainly I would think no more than 30 to 60 days after 

that time, we should have pretty much the fundamentals in place 

of what that model will look like. 

Mr. RYAN. Thank you very much. 

Mr. SIMMONS. If there are no more questions for this panel, I 

want to thank Dr. Roswell for his testimony. And thank Dr. Burris 

for his testimony. 

And now I would like to call the third panel. The third panel is 

composed of Ms. Jade Gong, who is principal of Health Strategy 

Associates, where she advises national associations and health care 

providers on the need for both institutional and community-based 

long-term care for seniors to include veterans at the state veterans 

homes. We also have Ms. Linda Sabo, who is executive director of 

the Alzheimer’s Association of Western New York since 1998. And 

I understand that New York’s VISN has an excellent program for 
34

dealing with Alzheimer’s patients. So I look forward to hearing 

about that. We also have Philip Jean. And I will ask my colleague, 

Mr. Michaud, if he would introduce Mr. Jean. 

Mr. MICHAUD. Thank you, Mr. Chairman. It is with great pride 

that I have an opportunity to introduce Philip Jean. He is president of the National Association of State Veterans Homes. Mr. 

Jean was elected by the membership of the National Association of 

State Veterans Homes and will serve as the 2003 and 2004 president. Philip has dedicated himself to improving the quality of care 

available to Mainers. From 1995 to 1999, he worked for North 

Country Associates as an administrator of a number of health care 

service facilities throughout the State of Maine. Since 1999, Mr. 

Jean has been the administrator of Scarborough Maine Veterans 

Home. This is 150-bed facility, provides some of the best possible 

skilled long-term Alzheimer, respite, residential, and end of life 

care in Maine. 

I would like to particularly note the work that Mr. Jean has done 

that led to the addition of a 30-bed dementia assisted living unit. 

It is my honor to introduce to the committee someone who is working so hard for the veterans and their families. I look forward to 

working with Phil to improve the level of care available to our veterans and look forward to hearing his testimony, along with the 

testimony of all of our witnesses here today. 

Thank you, Mr. Chairman. 

Mr. SIMMONS. I thank you. The witnesses were introduced beginning with Ms. Gong and then Ms. Sabo and then Mr. Jean. If you 

want to follow that sequence, that would be fine. As you know, we 

will take your written or prepared statement and insert it in the 

record and that might give you the opportunity to be a little more 

creative in your presentation and perhaps even to discuss some of 

the issues that have been raised already on the record. I leave that 

to your discretion. You may begin. 

STATEMENTS OF JADE GONG, MEMBER, VA GERIATRICS AND 

GERONTOLOGY ADVISORY COMMITTEE, HEALTH STRATEGY 

ASSOCIATES; LINDA SABO, EXECUTIVE DIRECTOR, ALZHEIMER’S ASSOCIATION, WESTERN NEW YORK CHAPTER; 

AND PHILIP JEAN, PRESIDENT, NATIONAL ASSOCIATION OF 

STATE VETERANS HOMES, MAINE VETERANS HOME 

STATEMENT OF JADE GONG 

Ms. GONG. First, I would like to thank the committee for its role 

in amending the Service Contract Act as part of the Veterans 

Health Care Capital Asset and Business Improvement Act of 2003. 

Prior to the passage of this law, I represented many long-term care 

providers and the Service Contract Act was often mentioned as a 

burden, creating an unwillingness to contract with the VA. Under 

this new law, providers that serve veterans can now enter into 

agreements with the VA and they are no longer subject to these detailed reporting requirements. 

I would like to note that I did serve on the Federal Advisory 

Panel on Long-Term Care, the report which was mentioned many 

times today, as well as on the Geriatrics and Gerontology Advisory 
35

Committee and on the Assisted Living Selection Committee for the 

pilot that was authorized in the Millennium bill. 

I would say that a very important recommendation of our committee was to see that the VA indeed shift to actually providing 

these home and community-based services when they are appropriate. And we set as a target in our report that the VA essentially 

double its spending. We talked a lot about people and visits and 

episodes, all very confusing. Let’s get down to the money that is 

spent. And we set a simplistic target that the VA double its spending in light of everything else that is going on on home and community-based options. And, as I looked at the last GAO report, as I 

looked at other GAO reports, recognizing also that, and comparing 

to state Medicaid programs, I found that the VA did not actually 

meet that target in terms of doubling their spending on non-institutional care despite the development of new programs. 

Just to make a broad comparison to Medicaid programs, as was 

mentioned earlier today, no, they are not entirely comparable, but 

I would say that over the past decade Medicaid programs have focused on waiver programs. These combine a variety of services into 

particular programs to try to meet the needs of individual who are 

specifically eligible for the nursing facility level of care, as well as 

other kinds of programs. State Medicaid programs have shifted 

considerable dollars into non-institutional programs by comparison. 

I also want to mention, again in the private sector, that assisted 

living, I am sure you have all heard, has grown tremendously. 

There are lots of discussions about its regulation and its quality, 

but I would say that in my opinion that it offers a very important 

level of care that is much closer to the community, that is homelike. Many, many private residents, as well as I think VA residents, would want to have their care in something that is closer to 

an assisted living facility. I believe for the most part now most veterans do not receive that level of care, assisted living care. 

With all of that context, I have four suggestions or recommendations that I at least want to put on the table for discussion. The 

first is a little radical. It concerns the 1998 base year, around 

13,000 to 14,000 days for VA-provided nursing home care. I don’t 

know the details about the total level of spending associated with 

this number of days. But I do believe that buying VA into institutional care as opposed to non-institutional care, and I would like 

to see the VA have more flexibility to look at the individual and 

to spend that money for an eligible person with a package of services that that individual would need, be it institutional, the VA’s 

own stay home contract or a combination of home care services. 

So I would actually advocate for removing that number on VA’s 

own provided nursing home care and look to a broader indicator, 

yet to be defined, about VA long-term care spending, whether or 

not it is quality services and holding the VA itself and the individual VISNs accountable for an appropriate level of long-term care 

spending in their population. 

Secondly, as I mentioned, I did serve on the selection committee—no, the second recommendation I have is with regard to 

PACE, Programs of All-Inclusive Care for the Elderly. These are 

programs that operate all around the country now, serving Medicare and Medicaid beneficiaries. The VA through its pilot has set 
36

up three of these programs in Columbia, South Carolina; Denver, 

Colorado; and Dayton, Ohio. It has been my understanding that 

the evaluation is not done yet and those programs would possibly 

terminate before the findings of those studies could possibly be applied across the country in the VISNs. 

I would urge, I don’t know if the VA can do it or if Congress 

would have to direct that, that those pilots be continued. They are 

excellent programs. They have been evaluated and studied for over 

25 years in the Medicare/Medicaid programs. I would like to see 

those programs have a place somewhere within the VA but certainly that those programs be able to continue until the evaluations 

are complete and that could be looked at. 

With regard to assisted living, I make the same recommendation 

with continuing that pilot. 

And then finally, with regard to the state home construction and 

per diem program, we have talked about that a lot, I would like 

to see if some of that funding could be applied to assisted living 

rather than merely nursing home care and that a higher priority 

be given to that. 

Thank you very much. 

[The prepared statement of Ms. Gong appears on p. 150.] 

Mr. SIMMONS. Thank you very much. Before we do questions, 

let’s hear from Ms. Sabo. 

STATEMENT OF LINDA SABO 

Ms. SABO. Mr. Chairman and members of the committee, thank 

you for this opportunity. In light of some of the comments that 

have come up and some of the questions about CARE and resources 

and some very interesting propositions there, I am happy to tell 

you that I am here to talk a little bit about our experience with 

the Partners in Dementia Care Initiative. 

Since 1997, my chapter—we serve Western New York, that is, 

the Buffalo Niagara region—and three other Alzheimer Association 

chapters in upstate New York have been working with the Veterans Integrated Services Network, you know that as VISN–2, to 

create a coordinated system of care for veterans with Alzheimer’s 

disease. 

The initiative is important for two reasons. First, the large number of veterans suffering from Alzheimer’s disease and other dementia, and from here on when I say ‘‘Alzheimer,’’ I mean people 

with Alzheimer and/or other dementia. 

A new study using VA data found that more than 7 percent of 

veterans over 65 who received VA services between 1997 and 2001 

had a documented diagnosis of dementia. In 2000, 13 percent of 

people 65 and over and 42 percent of those 85 and older had Alzheimer’s disease. That is Alzheimer’s alone for the latter, not all 

dementias. As we have already said many times here, we expect a 

huge increase in the number of veterans aged 85 and over. Therefore, we know that the numbers of those with dementia is going to 

be huge. We have to be prepared to meet the needs of those 

veterans. 

A second reason the Partners in Dementia Care Initiative is important is that the VA must find innovative ways to ensure appropriate services and support are provided to veterans. This initiative 
37

provides a best practice model for ensuring that. The Partners in 

Dementia Care Initiative is groundbreaking because of the extent 

of ongoing cooperation between the VA and the Alzheimer’s Association chapters. VA physicians, nurses, and other VISN–2 staff 

worked with our chapters to identify the health care, long-term 

care and supportive services that each of our organizations can provide to veterans, particularly those with Alzheimer’s Disease. 

Coordination of care has been a problem, both within the VA and 

between VA and community agencies. Even if needed services are 

available, including the important, non-institutional services mandated by the Millennium Act, veterans with Alzheimer’s Disease 

may not know about or receive those services. The Partners in Dementia Care Initiative is intended to ensure that these veterans 

and their families are connected to VA and non-VA services that 

will help. 

Previous experience indicates that families who are referred to 

Alzheimer’s Association from VA or other providers wait an average of 2 years before contacting us. We know from chapter experience that by that then, they frequently call because they are in a 

meltdown and are in trouble. In Partners in Dementia Care we developed a very effective manner for getting those families through 

outreach and direct contact to reach us much before those crises 

occurred. 

Collaborating on the Partners in Dementia Care Project is important to the Alzheimer’s Association because it helps us ensure veterans who are eligible for health care and long-term care services 

through the VA are quickly connected there. For the VA, the initiative creates a way to improve the care available by reaching our 

non-VA community services. Evaluation of Partners in Dementia 

Care Initiative indicates that this best practice model of care can 

increase early identification and diagnosis of Alzheimer’s Disease 

and other dementia, improve quality of care, expand access to 

needed information and services, and increase satisfaction for veterans with dementia and their families. 

For example, more than 500 veterans with Alzheimer’s Disease 

were enrolled in Partners in Dementia Care. Most of these veterans had not been previously diagnosed. VA and Alzheimer’s Association staff who were interviewed about the initiative had strongly 

positive attitudes about its impact on quality of care and outcomes 

for veterans. More than 80 percent of these care providers said the 

initiative had improved their own ability to care for persons with 

dementia. 

A recent GAO study of Millennium Act services provided for veterans in all VISNs in 2001 found that VISN–2 provided non-institutional Alzheimer care for three times more veterans than the average for all the other VISNs. VISN–2 also provided non-institutional day services for nearly three times more veterans than the 

average for all the other VISNs. 

The Alzheimer’s Association and VA staff from VISN–2 and 

headquarters and some other researchers are currently working together on proposals to implement and evaluate this best practice 

model in other VISNs. We are aware that all of the non-institutional services mandated by the Millennium Act are not uniformly 
38

available to all veterans and encourage the VA to increase that 

availability. 

And, finally, while I have talked extensively about non-institutional services, I also want to stress the importance of having adequate nursing home beds for veterans with Alzheimer who need 

that level of care and don’t have families to care for them. 

Thank you. 

[The prepared statement of Ms. Sabo appears on p. 157.] 

Mr. SIMMONS. Thank you for that testimony. 

And now Mr. Jean, from the great state of Maine. 

STATEMENT OF PHILIP JEAN 

Mr. JEAN. You can say Mr. Jean or Mr. Jean, either way. 

Mr. SIMMONS. There you go. It is always confusing. 

Mr. JEAN. Good afternoon, Mr. Chairman and members of the 

committee, and thank you for the opportunity to testify today on 

behalf of the National Association of State Veterans Homes on the 

issue of long-term care for veterans. I am pleased to serve as the 

2003/2004 president of NASVH. I am joined today at this hearing 

by two of my colleagues. Bob Shaw is the administrator of the Colorado State Veterans Nursing Home and the legislative officer for 

NASVH. John King is the director of the Washington State Department of Veterans’ Affairs and vice president of the National Association of State Directors of Veterans’ Affairs. 

Mr. SIMMONS. If they are here, could they stand so we could recognize them? Thank you for coming. Appreciate it. (Applause.) 

Mr. JEAN. State veterans homes are the largest deliverers of 

long-term care to our nation’s veterans. We operate under a program administered by the Federal Department of Veterans Affairs, 

which offers construction grants and per diem payments to support 

state veterans homes. Each state veterans home meets stringent 

VA-prescribed standards of care, which exceeds standards of care 

prescribed for other long-term care facilities. 

With regard to the State Veterans Home Construction Program, 

six states have been identified by the VA as having either a great 

or significant need to build new state veterans homes immediately. 

These six states are Florida, Texas, California, Pennsylvania, Ohio, 

and New York. Under priorities set by the VA, 37 construction 

projects in 20 states will add needed new beds to the system. In 

addition, numerous other renovation projects within the system are 

either underway or planned in several other states. Most importantly, the state veterans home system can construct and operate 

these long-term care facilities at far less cost to taxpayers than can 

the Federal Government. This prompted the VA Office of Inspector 

General to conclude in a 1999 report that the State Veterans Home 

Program provides an economical alternative to contract nursing 

home placements and VA medical center nursing home care. 

Unfortunately, there now exists an immediate threat to the state 

veterans home program that we hope the members of this committee will consider and address this year. The use of VA per diem 

payments by many states is threatened by interpretations of Medicaid rules by the Centers for Medicare and Medicaid Services. This 

threat applies to the growing number of states that have elected 

to fund their state veterans homes in part through Medicaid. There 
39

are approximately 20 states where the state veterans homes are 

Medicaid certified. For those states, there is some ambiguity regarding the treatment of the VA per diem. 

Under the interpretation of the Medicaid rules being advanced by 

CMS, VA per diem payments would be considered a third party 

payment in the Medicaid-certified states. This would require that 

the entire amount of the VA per diem be offset against Medicaid 

payments, thereby denying veterans who receive Medicaid in these 

states any benefit whatsoever of the VA per diem payments. This 

result obviously frustrates the intent of Congress in establishing 

the per diem payments in the first place. The CMS interpretation 

would treat veterans no differently than non-veterans. In my own 

state of Maine, this interpretation is also contrary to state law, 

which requires that the Maine Veterans’ Homes retain any per 

diem funds they receive from the Federal VA. 

The result of the CMS interpretation would be to force the state 

veterans homes that do not currently offset the VA per diem payment to look for alternative funding sources, reduce their standard 

of care, and possibly to close some state veterans homes. At the 

Maine Veterans’ Homes, the VA per diem payments are the difference between our veterans home system operating in the black 

or operating in the red. We simply could not provide our current 

level of service if Medicaid funding were offset against the VA per 

diem amount. Our fear is that an insistence by CMS on their interpretation would jeopardize the funding balance for many Medicaidcertified state veterans homes across the country, particularly during a period when states face severe financial crises. 

A clarification to the law to solve this problem would make clear 

that VA per diem payments would not be required to be treated as 

a third party payment under Medicaid. Federal law already includes exceptions for the similar payments, including those made 

under the Indian Health, Community Health, and Migrant Health 

programs. Clarifying that the VA per diem should similarly not be 

treated automatically as a third party payment would eliminate 

the threat to states that are Medicaid-certified. For the majority of 

states, which are not Medicaid-certified, there would be no effect. 

And because the proposed legislation would clarify the law as it is 

currently being implemented and applied, there would be no new 

cost to the Federal Government. 

It is essential that Congress clarify the matter now and ensure 

that the long-term care promises we have made to our veterans are 

kept. 

Mr. Chairman, we look forward to working with you and members of the committee on this important matter. And I thank you 

for the opportunity to testify. 

[The prepared statement and supplement to testimony of Mr. 

Jean appear on pp. 161 and 172.] 

Mr. SIMMONS. Thank you for that testimony. I have a couple of 

questions. The first question I have for Ms. Gong. Earlier today 

there was a brief discussion of what I guess we call tele-medicine. 

And a while ago I asked my local VA if they were doing anything 

in that regard and I was given a short briefing involving a very 

large piece of equipment that actually kind of looked like a battery 
40

charger, as I recall it, big and heavy and wires in and out of it. 

And I wasn’t terribly impressed. 

Since that time, I have talked to some private providers who are 

either piloting in the private sector or developing tele-medicine systems that are quite sophisticated. And, as you probably know, 

Members of Congress run around with these little Blackberries, 

communicating with the world right off our belt. 

So it seems to me that small and sophisticated systems might be 

available to our veterans, especially those who are receiving home 

health care. What is your experience with tele-medicine? Do you 

have any comments on that subject? 

Ms. GONG. I don’t know a lot about the details of the various 

technologies that are available. I do know that in rural areas and 

with rural long-term care we are trying to apply a similar strategy 

that Dr. Roswell mentioned, to use tele-medicine so that we can efficiently link with providers in urban centers to save on travel 

costs. We are thinking about that. There is a strategy for the Pace 

Program that I mentioned where we take very sick individuals and 

try to keep them at home. This is a new concept, a pretty new concept I think even outside of the VA. If that box is as big and bulky 

as you described, I think there are some sophisticated technologies 

that are out there that they could possibly explore. 

Mr. SIMMONS. And are there certain patients, and maybe Ms. 

Sabo wants to come in on this, especially with regard to dementia, 

are there certain patients for whom this works well and others it 

doesn’t. For example, dementia patients being cared for at home, 

does tele-medicine help, hurt, is it not applicable, is this a system 

that works better with other kinds of long-term care patients? 

Ms. SABO. What I can tell you about persons with dementia is 

that a system like that might very well help their care givers, particularly if they live in rural areas. Upstate New York has a fairly 

large population of people we serve in rural areas. It does not help 

a person living alone with dementia because they are not going to 

remember what the box is for or understand how to use it. 

So we find that many, many of our people who are cared for by 

families need those supports. It really depends on what other resources are available to the family. 

Mr. SIMMONS. Thank you. Mr. Jean, I was intrigued by your experiences at the Maine state home and the threat you see presented by CMS or CMMS, however they want to call themselves, 

through Medicaid reimbursements. That is a very intriguing subject to me because Medicaid is essentially run through the state so 

if the state is offsetting their Medicaid payment, either with a per 

diem payment from the VA or in some cases garnishing retirement 

payments from the Veterans itself, how do we make sure that the 

veteran is getting maximum use of these dollars and that in fact 

the veterans program through the veterans home is not perhaps 

subsidizing some other health program within the particular state? 

Mr. JEAN. Interestingly, one of the intriguing parts of the state 

veterans homes program is that the VA has prescribed standards 

that are more significant than those prescribed by CMS. The standards of care that are required by the VA certainly cost more. And 

the monies that we use in addition to the Medicaid reimbursement 

go to paying for round the clock nursing care and other things that 
41

are not required and prescribed by CMS. It is just an example of 

things that we need to provide to ensure the quality of care, and 

it is certainly one of the things that makes the state veterans 

homes very unique as far as a long-term care provider for veterans. 

Mr. SIMMONS. And you made mention of legislation that might 

address this issue. Are you familiar with the disposition of that legislation? That should be my question to answer but I was just curious since you raised it? 

Mr. JEAN. Yes, very briefly, one thing I should also mention is 

back in 1986 there was legislation that was proposed at that time 

which was cosponsored by Mr. Evans on your committee. We are 

in the very early stages of working on that legislation but it is certainly something that is being worked on currently. 

Mr. SIMMONS. I thank you for those comments. We are joined by 

Mr. Evans, the distinguished ranking member of the full committee 

and I would ask if he has any questions for the witnesses? 

Mr. EVANS. I appreciate this compliment but I don’t have anything at this time. So back to you. 

Mr. SIMMONS. I thank the gentleman. And, Mr. Michaud, from 

Maine. 

Mr. MICHAUD. Thank you, Mr. Chairman. I have a few questions 

for Mr. Jean. If the funding provided by the VA is considered a liability for the VA, what would the practical implication be for 

homes in the State of Maine and all across the country. And the 

second question is how would congressional clarification of the 

treatment of VA state home funding help state homes and why is 

it a timely issue now? 

Mr. JEAN. In answer to your first question, the per diem that 

some states do use and have available to them—should that not be 

available to those state veterans homes in particular, the very simple answer and the effect of that would be that the facilities would 

have to close their doors. And there are many other states that are 

in the same position. The per diem basically is the difference, as 

I said in the testimony, between the state operating in the red and 

operating in the black. And so the per diem is certainly a very valuable source that we do have to ensure the care for the veterans. 

In answer to your second question, if I understood it correctly, 

currently there is a threat, CMS is auditing different states and 

based on their interpretation, there may be threats to states that 

currently do not offset. They may need to either repay past payments that were not offset or begin offsetting immediately for 

Medicaid. 

Mr. MICHAUD. A couple of follow-up questions. How does the cost 

of long-term care in state veterans homes compare to the same care 

in a VA facility? And the second question, in your experience, what 

are the benefits to the veteran patient and his or her family of receiving long-term care in the state veterans home? 

Mr. JEAN. With regard to the state veterans homes, in terms of 

the cost of care, it is basically about half or less. The VA share for 

state veterans homes is just the per diem amount, so the cost is 

much, much less in the state veterans home program. 

With regard to benefits for veterans in state veterans homes, 

there are certainly many, a few of which I mentioned a while back. 

One example is the differences in terms of VA-prescribed stand-
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ards, higher standards of care that we provide to veterans in terms 

of round-the-clock nursing care. Many of the state veterans homes 

are considered teaching facilities for medical schools. They are all 

built to very stringent federal requirements, are very modern, and 

very clean. The standard of care and the quality of care is typically 

superb. And one of the other major benefits, especially in some 

states, is that the state veterans homes are spread throughout the 

state. They provide easier access to care. 

Mr. MICHAUD. Thank you. 

Mr. SIMMONS. I have a question for Mr. Jean. And, again, you 

have heard my remarks earlier about my enthusiasm for state veterans homes and how they complement the work of the VA, at 

least in my state, the VA hospitals in the CBOC system. 

One of the issues that I have encountered in dealing with the 

senior population is the value of adult daycare where a veteran living at home has the opportunity to come into the veterans home 

for a portion of the day, which takes some of the burden off of the 

care provider, keeps that veteran active mentally, which I think is 

very important in dealing with issues like dementia, and contributes to their quality of life. A couple of years ago, this committee 

authorized adult daycare. 

Have any of the three of you encountered the establishment of 

those programs in your area, and what is your assessment? 

Mr. JEAN. I guess my initial answer would be in terms of the 

growth of the adult daycare program, certainly Dr. Burris from VA 

Geriatrics and Extended Care could probably speak much better to 

that than I could or Dr. Roswell as well. But the adult daycare program is a program that is part of the VA Geriatrics and Extended 

Care program and it is certainly one that I believe is available in 

some states. 

Mr. SIMMONS. Do you have it in Maine? 

Mr. JEAN. We do not. 

Mr. SIMMONS. Is there any particular reason for that? 

Mr. JEAN. The adult daycare program is one in which there has 

been very slow growth for a variety of reasons. And so within 

Maine particularly, there has been a focus on expanding upon the 

facilities in the last few years. Actually, four of the five homes have 

just added brand new domiciliary wings. So there has been growth 

in other ways, certainly among those programs which have been a 

priority in our areas. 

Mr. SIMMONS. Thank you. Either of the other witnesses encounter these programs? 

Ms. GONG. I believe in the work that I have done with state 

homes in doing some of the projections of need, I always recommend adult daycare. And I think there are several homes, I 

think three, I believe, that are in the process of becoming a reality, 

and hopefully, a few more. I think there are other kinds of programs the VA could implement that also uses that adult daycare 

model that benefit the veterans and their families in the way that 

you describe. 

Ms. SABO. VISN–2 had provided day program services to three 

times as many persons as the other VISNs average. And I will say 

I know that program personally. It is a wonderful program and 

that is very well used, to the extent that there is quite a long wait-
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ing list. Within the last year or so some funds were made available 

through the VA for people to benefit from adult day in community 

programs, for which they were reimbursed. That has been a heavily 

used program. And possibly through our Alzheimer Association 

chapter and possibly the other chapters in the state, (I can speak 

only to our chapter having direct experience,) that a very large 

number of veterans who have approached the chapter looking for 

services have been referred out for day programs and were able to 

reach their goal either through the program at the VA or through 

the funded programs. It has been a terrific resource. 

Mr. SIMMONS. Thank you very much for that. 

Mr. Evans? Mr. Michaud? 

Hearing no more questions, I want to thank our panel for coming 

here today. I want to thank those in attendance for their attendance and patience. And wish you all the best. 

This hearing is now adjourned. 

[Whereupon, at 2:30 p.m., the committee was adjourned.] 

(45)

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WRITEN COMMITTEE QUESTIONS AND THIER RESPONSES 

CHAIRMAN SMITH TO DEPARTMENT OF VETERANS AFFAIRS
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Æ