Department of Veterans Affairs 

Office of Inspector General 

Evaluation of the 

Veterans Health Administration 

Homeless Grant and 

Per Diem Program 

Report No. 04-00888-215 September 20, 2006

VA Office of Inspector General 

Washington, DC 20420 
To Report Suspected Wrongdoing in VA Programs and Operations 

Call the OIG Hotline – (800) 488-8244 
Evaluation of the Veterans Health Administration Homeless Grant and Per Diem Program 

Contents 

Page 

Executive Summary ........................................................................................................i

Purpose ............................................................................................................................. 1

Background...................................................................................................................... 1

Scope and Methodology............................................................................................... 4

Results and Conclusions ............................................................................................. 6 

Clinical Services.............................................................................................................. 6 

Issue 1 – Some Clinical Functions Were Not Performed ............................................ 7 

Issue 1a – Records Did Not Always Contain Adequate Documentation of Clinical 

Activities............................................................................................................................. 8

Issue 1b – Completeness and Accuracy of Discharge Data Were Not Always Assured.. 11

Issue 2 – Performance Improvement Activities and Oversight Were Inadequate ..... 14

Issue 3 – GPD Inspection Deficiencies Were Not Always Corrected ....................... 19

Issue 4 – VA-GPD Liaisons Did Not Provide Sufficient Oversight of Program 

Operations .................................................................................................................. 21

Financial Controls.......................................................................................................... 24

Issue 5 – Overstated GPD Providers’ Per Diem Rates Resulted in Overpayments... 25

Issue 6 – Corrective Actions Following a Previous GPD Assessment Were 

Insufficient ................................................................................................................. 29

Issue 7 – The National GPD Program Office Did Not Provide Adequate Oversight 

of GPD Operations..................................................................................................... 33

Comments....................................................................................................................... 35 

VHA Comments ....................................................................................................................... 35

OIG Comments......................................................................................................................... 36

Appendixes 

A. Acting Under Secretary for Health’s Comments..................................................... 37

B. OIG Contact and Staff Acknowledgments............................................................... 53

C. Report Distribution................................................................................................... 54

VA Office of Inspector General 
Evaluation of the Veterans Health Administration Homeless Grant and Per Diem Program 

Executive Summary 

The Office of Inspector General conducted an evaluation of the Veterans Health 

Administration Homeless Grant and Per Diem (GPD) Program to determine whether: 

(a) homeless veterans received appropriate clinical services, (b) VA and GPD providers 

engaged in performance improvement activities, (c) VA teams inspected GPD facilities

annually, (d) VA managers provided adequate oversight of program operations, and

(e) fiscal controls were in place. We also followed up on deficiencies identified during a 

previous review of the GPD Program. The review covered various aspects of program

operations from October 2002 through January 2006. 

The GPD Program was authorized to establish alternative housing programs for homeless 

veterans through partnerships with non-profit or local Government agencies. We visited 

8 VA Medical Centers with GPD programs that offered a combined total of 730 beds and 

1 stand-alone Service Center. 

While we found many programs that were clinically strong, appropriately administered, 

and fiscally sound, we also identified some program areas that required attention. 

• Records did not always contain documentation of clinical activities. 

• Completeness and accuracy of discharge data were not assured. 

• Northeast Program Evaluation Center data was not reviewed or discussed with 

GPD providers. 

• GPD proposal goals were not adequate, monitored, or followed up. 

• GPD inspection deficiencies were not always corrected. 

• VA-GPD liaisons did not provide sufficient oversight of program operations. 

• Financial reviews were not sufficient to prevent overpayments to GPD providers. 

• Corrective actions from a previous GPD review were insufficient. 

• The National GPD Program Office did not provide adequate oversight of GPD 

operations. 

We made recommendations to improve: 

• Documentation of clinical activities and outcomes. 

• Monitoring of GPD program performance. 

• Follow-up of inspection deficiencies. 

• Liaison oversight of GPD operations. 

• Quality of financial reviews. 

• Follow-up of corrective actions from a previous GPD assessment. 

• Oversight provided by the National GPD Program Office. 

The Acting Under Secretary for Health agreed with the findings and recommendations

and provided acceptable improvement plans. We will follow up on all planned actions

until they are completed. 

VA Office of Inspector General i 
DEPARTMENT OF VETERANS AFFAIRS

Office of Inspector General 

Washington, DC 20420 

TO: Acting Under Secretary for Health 

SUBJECT: Evaluation of the Veterans Health Administration Homeless Grant and 

Per Diem Program 

Purpose 

The Department of Veterans Affairs, Office of Inspector General (OIG), Offices of 

Healthcare Inspections and Audit conducted an evaluation of the Veterans Health 

Administration (VHA) Homeless Grant and Per Diem (GPD) Program. The purpose of

the evaluation was to determine whether: (a) homeless veterans received appropriate

clinical services, (b) VA and GPD providers engaged in performance improvement 

activities, (c) VA teams inspected GPD facilities annually, (d) VA managers provided 

adequate oversight of program operations, and (e) fiscal controls were in place. We also 

followed up on corrective actions taken by the National GPD Program Office in response 

to previous reviews of the GPD Program. 

Background 

Homelessness is a condition in which an individual “lacks a fixed, regular, and adequate 

nighttime residence; and... has a primary nighttime residence that is: (a) a supervised 

publicly or privately operated shelter designed to provide temporary living 

accommodations..., (b) an institution that provides a temporary residence for individuals 

intended to be institutionalized, or (c) a public or private place not designed for, or 

ordinarily used as, a regular sleeping accommodation for human beings.”1

Homelessness is generally believed to be the result of lack of affordable housing, 

reduction in the availability of public assistance benefits and medical/mental health 

treatment services, high unemployment rates, and low wages for those that are 

employed.2

 1

 Stewart B. McKinney Act, 42 United States Code § 11301, et seq. (1994). 2

 National Coalition for the Homeless, Why Are People Homeless?, June 2005. www.nationalhomeless.org. 

VA Office of Inspector General 1 
Evaluation of the Veterans Health Administration Homeless Grant and Per Diem Program 

While low income is clearly a risk factor associated with homelessness, middle income

households may also be at risk. A recent study published in Parade magazine on 

April 23, 2006, which surveyed 2,200 American households earning between $30,000 

and $99,000 a year, found that 66 percent of these middle-income Americans reported 

that they tend to live paycheck to paycheck. This lack of reserve resources demonstrates 

the vulnerability of many Americans to unexpected events, such as loss of wages due to 

injury, or catastrophic events, such as Hurricane Katrina, which could render them

homeless. 

While estimates regarding the number of homeless people vary depending on the data

collection method used, the demographics of homelessness among single adults have not 

substantially changed in the past 15 years. VA estimates that about one-third of the adult 

homeless population is comprised of veterans, with about 200,000 homeless veterans 

living on the streets or in shelters on any given night, and possibly as many as 400,000 

veterans homeless at some time during the course of a year.3

 This estimate does not 

include those fringe or marginally homeless veterans who double up with family or 

friends and whose tenuous housing arrangements could end at any time. 

VA Homeless Program

In 1987, VA first authorized services to house and treat homeless veterans. Today, VA

offers the largest integrated network of homeless treatment and assistance services in the 

country. The VA Health Care for Homeless Veterans (HCHV) Program was established 

to serve homeless veterans with limited resources and who suffer from severe psychiatric 

and substance abuse problems.

4

 HCHV is an umbrella program that includes multiple

specialized programs and services offering a continuum of care to homeless veterans. 

Those programs provide: 

• Aggressive outreach to veterans living in shelters or on the streets. 

• Clinical assessment and referral to medical, psychiatric, and substance abuse

services. 

• Residential treatment, transitional housing, case management, and rehabilitation. 

• Employment assistance and linkage to income sources and benefits. 

• Supported permanent housing.5

The HCHV Program served 63,283 veterans in its various homeless programs in fiscal 

year (FY) 2004;6

 final FY 2005 data is not yet available. 

 3 vaww1.va.gov/homeless It should be noted that information referenced from vaww1.va.gov or vaww.va.gov 

websites are from VA intranet sites not available outside the VA system. 4

 Health Care for Homeless Veterans (HCHV) Programs: 18th Annual Report (4/15/05), Chapter 1, pps. 1–3.

vaww.nepec.mentalhealth.med.va.gov. 5

 NEPEC 18th Annual Report, Chapter 1, pps. 1–3. 6

 NEPEC 18th Annual Report, Executive Summary, page ii. 

VA Office of Inspector General 2 
Evaluation of the Veterans Health Administration Homeless Grant and Per Diem Program 

GPD Program

In the early 1990s, the GPD Program was authorized by Public Laws 102–5907

 and 104–

1108

 to establish alternative housing programs for homeless veterans through partnerships 

with non-profit or local Government agencies. Since 1994, VA has offered grants 

totaling $108 million for construction and renovation of buildings and $193.9 million for 

service provision to homeless veterans. The principal mission of the GPD Program is to 

promote the development and provision of supportive housing and/or supportive services 

to homeless veterans for up to 2 years. 

The term “GPD provider” refers to the public or private organization that was funded to 

offer GPD services to homeless veterans. Some GPD providers, such as the Salvation 

Army, receive funding for and operate several GPD programs, often in different 

buildings. While some GPD providers offer an extensive array of supportive services 

addressing substance abuse, mental health, medical, and social issues, other GPD 

providers offer minimal onsite services and refer veterans to other community social 

service agencies. Some GPD providers were funded as Service Centers and offer basic 

services such as showers and meals in a low-demand environment for homeless veterans. 

National GPD Program Office

VHA’s National GPD Program Office located in Tampa, Florida, is the operational center 

of the GPD Program. Five National GPD Program Office employees disburse funds, 

review initial and annual inspection files and fiscal documents, draft policies and other 

guidance, and hold monthly conference calls to educate VA Medical Center (VAMC) and

community GPD providers about GPD Program functions, enhancements, and changes.

The National GPD Program Office, along with other grant review panel members, also 

evaluates grant proposals submitted by community homeless providers seeking GPD 

funding to serve veterans. 

Northeast Program Evaluation Center

The Northeast Program Evaluation Center (NEPEC), located on the West Haven campus 

of the VA Connecticut Healthcare System, has played a major role in designing,

implementing, and evaluating innovative mental health programs since 1987.9

 NEPEC

evaluates VA projects budgeted at almost $300 million annually and provides 

informational support in the areas of quality assessment, cost-effectiveness, and health 

system organization and finance. One of NEPEC’s primary evaluation efforts focuses on 

performance and outcomes of specialized treatment programs for homeless veterans. 

NEPEC collects data and issues quarterly and annual performance reports. 

 7

 Public Law 102–590, The Homeless Veterans Comprehensive Service Programs Act of 1992. 8

 Public Law 104–110, An Act to amend title 38, United States Code, to extend the authority of the Secretary of

Veterans Affairs to carry out certain programs and activities, and for other purposes. 9 www.nepec.org. 

VA Office of Inspector General 3 
Evaluation of the Veterans Health Administration Homeless Grant and Per Diem Program 

NEPEC’s annual reports show that in 1998, there were 44 GPD programs with 866 beds;

in 2004, there were 267 GPD programs with a total of over 7,000 beds10 that 

accommodated 13,509 program admissions.11 As of February 2006, National GPD 

Program officials reported 309 operational GPD programs including 14 stand-alone

Service Centers.12 Because of the GPD Program’s explosive growth, our review focused 

almost exclusively on this program.

Scope and Methodology 

Prior to initiating our review, we visited the National GPD Program Office and reviewed 

GPD proposals and inspection reports to better define the universe of GPD programs. 

We selected eight VAMCs with GPD programs that comprised a mix of facility sizes, 

geographic locations, and Veterans Integrated Service Networks (VISNs). The 8 

VAMCs had agreements with 22 GPD providers that operated 32 GPD programs; the 

GPD programs offered a combined total of 730 beds and 1 stand-alone Service Center.

We visited the facilities from June 20, 2005, through January 27, 2006. The review

covered various aspects of program operations from October 2002 through January 2006. 

SITE DEMOGRAPHICS 2005

VAMC 

# of GPD 

Funded 

Recipients

# of GPD 

Programs 

Reviewed 

Total GPD 

Beds 2005 Costs 

VA-GPD 

Liaison 

Assignment** 

A 1 1 60 $111,112 PT

B 3 3 112 710,339 PT

C 1 1 12 59,084 PT

D 4 4 73 558,728 PT

E 1 3 180 1,493,309 PT

F 4 10 145 1,230,698 PT

G 3 3 38 271,184 PT

H 5 7* 110 895,939 FT 

TOTAL 22 32 730 $5,330,393 

* Includes one Service Center 

** Full-time (FT) or part-time (PT) at the time of our visit 

At the eight VAMCs visited, we interviewed the following VA personnel to determine 

program policies, procedures, and controls: HCHV coordinators, VA-GPD liaisons, 

social workers, facility management staff, police officers, contracting staff, and Fiscal 

Service staff. At the community GPDs, we interviewed executive directors, clinical staff, 

accountants, and some resident veterans. We reviewed The Homeless Veterans

Comprehensive Service Programs Act of 1992, Public Law 102–590; Title 38, Code of 

Federal Regulations (CFR), Sections 17.700–17.731 and 61.0–61.82; Office of 

 10 Ibid. 11 NEPEC 18th Annual Report, Executive Summary, page iii. 12 Stand-Alone Service Centers are funded separately from GPDs providing housing.

VA Office of Inspector General 4 
Evaluation of the Veterans Health Administration Homeless Grant and Per Diem Program 

Management and Budget (OMB) Circulars A-110, A-122, A-133; VHA Directive 

2002-072, Health Care for Homeless Veterans Homeless Providers Grant and Per Diem 

Program; VA’s Homeless Providers Grant and Per Diem Program Liaison Guide (GPD

Liaison Guide, dated March 16, 2004), and the newly issued VHA Handbook 1162.01, 

Grant and Per Diem Program, dated March 1, 2006. We also visited NEPEC in West

Haven, Connecticut. 

To assess the VHA Homeless GPD Program, we: 

• Examined VA medical records and GPD program files of veterans receiving care 

at selected GPD facilities to evaluate whether the care needs of homeless veterans

were being adequately addressed and whether documentation supported discharge

and outcome data reported to NEPEC. 

• Interviewed VA and GPD program managers to determine whether sub-par

performance, as noted in NEPEC reports, was discussed by VA and GPD officials 

and if data were used to improve program services. 

• Compared program goals as identified in the initial GPD proposals with current 

performance results to determine whether program goals were being met. 

• Reviewed GPD inspection files to assess compliance with VHA guidelines and 

determine whether deficiencies identified in previous inspections were corrected. 

We also toured each of the community GPD facilities to evaluate current 

conditions of the properties and buildings. 

• Interviewed VA-GPD liaisons and collected data to determine whether liaison

requirements and functions were met as defined by VHA guidelines. 

• Analyzed the GPD providers’ financial data to assess whether costs were 

reasonable, allocable, and allowable. 

• Traced VAMC incurred costs for FYs 2003–2005 to the GPD providers’ general 

ledgers and audited financial statements to determine if the per diem rates were 

correct. 

• Reviewed GPD provider invoices, payment vouchers, and supporting 

documentation to determine if the providers’ invoices were certified prior to being 

paid. 

• Followed up on corrective actions taken in response to deficiencies identified

during a 2002 review of financial aspects of the GPD Program to determine if 

those actions were implemented and effective. 

VA Office of Inspector General 5 
Evaluation of the Veterans Health Administration Homeless Grant and Per Diem Program 

We discussed our findings, interpretations, and suggestions with the responsible VAMC

managers and community GPD providers. National GPD Program Office staff 

participated in exit briefings during seven of our eight site visits. 

We conducted the evaluation in accordance with the Quality Standards for Inspections

published by the President’s Council on Integrity and Efficiency. 

Results and Conclusions 

VHA’s Homeless GPD Program provides an array of traditional medical, mental health,

and social services to homeless veterans through its many community GPD providers. In 

addition, the Program has actively sought to fund GPD proposals that offer creative and 

non-traditional services to homeless veterans. Some unique programs we visited offered 

gardening and horticulture, assistance in purchasing small businesses, paid employment

in a GPD provider’s chocolate business, and jobs renovating apartments which then 

became the veterans’ homes. 

We found that VA staff assigned to the HCHV and GPD Programs were knowledgeable 

about homelessness and had developed the necessary community networks to ensure that 

homeless veterans had access to both VA and community services. Community GPD 

staff members were also knowledgeable and committed as demonstrated through their 

creative programming, personal attention to each veteran’s special needs, and donation of

time above and beyond traditional business hours. 

Homelessness is a particularly challenging condition often characterized by high relapse 

and recidivism rates, low to moderate treatment compliance, and difficult follow-up. 

Successes are often measured in incremental steps, with stable, mainstream housing a 

distant goal. Yet, during our site visits, we found numerous cases of formerly homeless 

veterans who, with the help of the GPD Program’s treatment and social services, quit

using drugs and alcohol, entered training, became employed, rented apartments, and 

became productive and contributing members of their communities. Several GPD

providers had hired some of their “graduates” into para-professional and facility support 

positions. 

While we found many programs that were clinically strong, appropriately administered, 

and fiscally sound, we also identified some program areas that required attention. 

Clinical Services 

The objectives of the clinical services component of the review were to determine 

whether (a) homeless veterans received appropriate assessment and treatment services 

and (b) data submitted to NEPEC were supported by VA medical records or GPD 

provider documentation. To evaluate these measures, it is important to understand the

VA Office of Inspector General 6 
Evaluation of the Veterans Health Administration Homeless Grant and Per Diem Program 

process for GPD assessment and treatment and the assignment of clinical responsibilities 

thereof. 

VAMCs usually have HCHV Programs staffed by VA nurses, social workers, and 

substance abuse counselors who provide a broad range of services to homeless veterans, 

and the GPD Program is just one element in this continuum of care. VAMCs have

oversight responsibility for GPD programs in their jurisdictions. Some VAMCs have 

small GPD Programs with 1 provider while other VAMCs have large programs with 

more than 15 GPD providers; 1 VAMC has 24 GPD providers. Each VAMC is required 

to assign a VA employee as a GPD liaison (referred to as the VA-GPD liaison) to ensure 

that clinical and administrative aspects of the program are operating effectively. 

GPD providers operate programs that typically have social workers, nurses, and

substance abuse counselors who provide the actual treatment and services to enrolled 

veterans. GPD providers usually have primary responsibility for case management of 

veterans and VA employees are responsible for clinical oversight to ensure that veterans 

are receiving appropriate services as defined in their treatment plans. There is no 

established standard for the frequency of VA-GPD liaison oversight visits to the GPD 

provider programs; however, VHA program officials told us that, ideally, VA-GPD

liaisons would visit GPD providers weekly, work collaboratively with GPD provider staff 

to improve operations, and know the veterans enrolled in the programs. 

NEPEC evaluates VA mental health treatment programs, including HCHV and GPD, and 

issues quarterly and annual performance reports that are used by VAMCs and GPD

providers to improve service delivery. VA clinicians document baseline demographics 

for homeless veterans and complete preliminary assessments and treatment plans on 

Form Xs, NEPEC’s data collection tool. Once a veteran is admitted to a GPD program,

primary responsibility for the case usually transfers to the GPD provider’s clinical staff. 

Most GPD clinicians reassess each veteran’s needs and document new treatment plans at

the times of admission. In the GPD Program, Form Xs should be completed within 3 

days of a veteran’s admission to a GPD facility. Upon a veteran’s discharge, VA or GPD 

clinicians knowledgeable about the veteran’s discharge disposition and status complete 

Form Ds, NEPEC’s data collection tool that focuses on outcomes. Form Ds should be

reviewed and the accuracy of the data verified by the VA-GPD liaison or designee. Form 

Xs and Form Ds should be forwarded to NEPEC by the 10th of each month. 

Issue 1: Some Clinical Functions Were Not Performed 

NEPEC provided us with admission, assessment, discharge, and cost data for those

veterans admitted to and discharged from the community GPD programs in the 2 years 

immediately preceding our site visits. At the 8 VAMCs included in our review, 2,918 

unique veterans had 3,713 episodes of GPD care during the 2-year period. The average 

GPD veteran was male (97 percent), 48 years old, and served during the Vietnam or postVietnam eras (90 percent). One of the sites we visited told us that they had served three

VA Office of Inspector General 7 
Evaluation of the Veterans Health Administration Homeless Grant and Per Diem Program 

homeless combat veterans who were deployed in the Persian Gulf in 2003–2004; one of 

those veterans remained in a community GPD program as of March 2006. 

We also selected 259 veterans from the NEPEC database (of 2,918 unique veterans) and 

reviewed their VA and GPD records while at each GPD site. These record reviews 

allowed us to follow an individual veteran’s progress from initial contact through 

assessment, treatment, and discharge. Some of the 259 records were excluded from

review in selected areas, most often because of short lengths of stay that did not offer

opportunity for adequate assessments, treatment plans, referrals, or progress updates. 

Issue 1a: Records Did Not Always Contain Adequate Documentation of 

Clinical Activities 

Homeless veterans frequently have multiple and complex problems that take months or 

years to address. The NEPEC data we reviewed, which generally covered FYs 

2003–2005, revealed that VA clinicians identified the following problems in homeless 

GPD veterans: 

• Medical problems (74 percent). 

• Alcohol abuse (70 percent). 

• Mental illness (69 percent). 

• Drug abuse (63 percent). 

• Income less than $500 per month (59 percent). 

• Unemployment (31 percent). 

As these conditions are highly associated with homelessness, it is imperative that 

clinicians provide comprehensive assessment, treatment, and referral services to help 

these veterans meet therapeutic goals and achieve independence. We noted the following 

deficiencies: 

Assessments were not always complete or current. The NEPEC database did not reflect 

that all veterans admitted to GPD programs were consistently assessed using the Form X. 

Of the 3,713 episodes of care provided at the 32 GPD program sites, 394 (11 percent) 

Form Xs were not submitted to NEPEC. In addition, 130 (4 percent) of the 3,319 

Form X assessments that were in the NEPEC database were more than 2 years old when

the veterans were admitted to a GPD program. VHA guidelines require VA-GPD

liaisons to ensure the collection and submission of participant data to NEPEC in a timely 

manner. While we could not find written guidelines, GPD Program officials told us that 

Form Xs should be updated, at a minimum, every 2 years for veterans receiving VA

HCHV services. 

As Form Xs are not always current, and clinicians often use the assessment process to 

learn about the veteran and engage the veteran in services, GPD clinicians usually

conduct their own assessments of each veteran’s needs and document new treatment 

VA Office of Inspector General 8 
Evaluation of the Veterans Health Administration Homeless Grant and Per Diem Program 

plans at the times of admission. We reviewed 259 GPD provider records to determine 

whether GPD clinicians completed assessments upon admission, and in 40 (16 percent)

of 251 applicable cases, we found the records did not contain new or revised assessments. 

Treatment plans were not always complete. NEPEC data showed that in 2,981 (of 3,319) 

episodes of care with Form X assessments, veterans were initially assessed to need 

psychiatric or substance abuse treatment; however, 469 (16 percent) Form X treatment 

plans did not reflect psychiatric or substance abuse treatment services as goals. This 

discrepancy could mean that 469 veterans did not receive needed treatment services. 

We also reviewed GPD provider records to determine whether their treatment plans, 

which should be more current than Form X treatment plans, were documented. We found 

that 45 (19 percent) of 241 applicable records did not contain any treatment plans. 

Treatment plans were not always fully implemented. We reviewed VA medical records 

and GPD records to determine whether veterans actually received the needed treatment or 

were referred for services as described in their treatment plans. For each of the 259 

cases, we focused on treatment planning goals (up to 5) as identified on the Form Xs. 

Some veterans had only one treatment planning goal identified, while others had several. 

We found no documented evidence that clinicians addressed or attempted to address 128 

(15 percent) of 860 treatment plan goals identified. 

As most GPD clinicians completed their own assessments and treatment plans when

veterans were admitted to their programs, their records would reflect only those issues 

identified by the GPD clinician. However, if the VA clinician identified the need for a 

service that would not be provided by the GPD provider, then the VA clinician should 

have made arrangements for the service outside of the GPD program. Thus, all treatment 

plan elements should have been addressed and documented by GPD or VA staff, or the 

justification for not doing so should have been documented. 

VA and GPD records did not always meet documentation standards. We reviewed 

progress notes completed by the primary case manager; in a majority of the cases, the 

GPD social worker had primary case management responsibilities for enrolled veterans.

We reviewed VA and GPD quality, content, and frequency standards for documentation, 

and when none existed, asked clinical managers about their expectations for 

documentation. We applied the appropriate standard when evaluating each record. We 

found that: 

• Fifty-four (22 percent) of 247 applicable records did not meet standards for frequency 

of documentation. Most providers required weekly documentation of client contact 

and progress in the early stages of GPD enrollment, to be scaled back as the veteran 

achieved more independence. Some records on newly placed veterans did not contain 

any progress notes for more than 3 months by either VA or GPD clinicians. 

VA Office of Inspector General 9 
Evaluation of the Veterans Health Administration Homeless Grant and Per Diem Program 

• Forty-three (21 percent) of 202 applicable records did not reflect treatment plan 

revisions based on the patient’s changing needs or on a periodic basis (such as every 

30 days). 

• Forty-eight (20 percent) of 246 applicable records did not contain sufficient 

documentation of each veteran’s status to determine their progress in meeting 

treatment goals or the need for additional services. 

Although not a formal requirement, we noted that 154 (65 percent) of 238 applicable

records did not contain evidence of interdisciplinary treatment planning. 

VA and GPD records did not always reflect the appropriateness of veteran readmissions

to the program. For the 2-year period prior to our visits, NEPEC data showed that 2,918 

unique veterans accounted for 3,713 episodes of care in GPD programs included in our 

review. Further review showed that 585 veterans (20 percent) in our sample were 

admitted to community GPD programs 2 or more times and that these veterans accounted 

for 1,380 (37 percent) of 3,713 episodes of care. The GPD Program recognizes that 

relapse and recidivism are byproducts of homelessness and its associated social problems

and allows for veterans to be readmitted to GPD programs when clinically indicated. 

Eighty-two (32 percent) of the 259 veterans in our sample were readmitted to GPDs more 

than once in the 2 years preceding our visits. However, in 26 (32 percent) of 82 cases, 

we found no documented evidence that VA clinicians reviewed the cases to (a) assess the

course of treatment during the first admissions and determine what treatment elements 

should change during the second admission to increase the chances for success or 

(b) determine whether GPD placements were appropriate a second or third time. For 

example, if a veteran was dismissed from a GPD program for relapse on drugs or alcohol, 

readmission to the GPD program may be contingent upon the veteran completing a 

detoxification or rehabilitation program, or he may be required to participate in

Alcoholics or Narcotics Anonymous meetings. To maximize resources and the

likelihood for success, it is important for clinicians to consider the veteran’s needs and 

what GPD has to offer and make adjustments to the veteran’s treatment plan to improve 

the chance for positive outcomes. Without clinical review, some veterans could be 

placed repeatedly in GPD programs with treatment plans that have been unsuccessful in 

the past. 

Issue 1a Conclusion 

Assessments and treatment plans are fundamental elements of service provision; they 

should be accurate and comprehensive documents that adequately assess and address 

clinical and social problems so as to ensure appropriate continuity of care. In cases 

where assessed needs cannot or will not be addressed, such as when the veteran declines 

services, the VA medical record or GPD provider records should document this

VA Office of Inspector General 10 
Evaluation of the Veterans Health Administration Homeless Grant and Per Diem Program 

justification. Without complete and up-to-date assessments and treatment plans, 

providers could not be assured that services were targeting current needs of veterans. 

Additionally, clinicians should document each veteran’s conditions and progress 

frequently enough that other care providers can determine the overall status of the veteran 

and provide appropriate continuity of services, as needed. Interdisciplinary treatment 

planning is often used in medical and social service settings as a means to enhance client 

outcomes. When veterans are readmitted to GPDs, clinicians should document that the

placements were clinically indicated so as to avoid duplication of previously unsuccessful 

placements and treatment plans. 

Recommended Improvement Action 1. The Acting Under Secretary for Health should 

require VHA to ensure that: 

a. VA-GPD liaisons or designees complete and submit Form Xs to NEPEC in a timely

manner. 

b. National GPD Program Office staff monitor Form X completion rates by VAMCs and 

require consistently underperforming sites to take corrective actions. 

c. VA and GPD provider employees adequately assess each veteran’s needs, devise

treatment plans to meet those needs, and document the case records to reflect these 

services. 

d. Clinicians comply with documentation standards regarding frequency of notes, 

treatment planning revisions, and veteran progress in the program to provide involved 

staff with an accurate depiction of the veteran’s status. 

e. Clinicians conduct and document interdisciplinary treatment planning. 

f. VA clinicians review and document agreement with placements and treatment plans 

for those veterans with multiple readmissions. 

Issue 1b: Completeness and Accuracy of Discharge Data Were Not Always 

Assured 

NEPEC reported 3,713 episodes of GPD care during 2003–2005 for the 8 VAMCs 

included in our review, and each episode had corresponding discharge data. Each time a 

veteran is discharged from a GPD program, a clinician completes a NEPEC Form D 

cataloguing a number of outcomes, including the type of discharge, living situation, and 

employment or benefits status. Additionally, clinicians document changes in the 

veteran’s clinical status in five categories at the time of discharge and note follow-up

arrangements for continued treatment, if needed. Our analysis of NEPEC outcome data 

for these veterans revealed the following: 

VA Office of Inspector General 11 
Evaluation of the Veterans Health Administration Homeless Grant and Per Diem Program 

• Forty-seven percent successfully completed the program.

• Forty-four percent moved to an apartment, room, or house. 

• Twenty-seven percent were employed full- or part-time. 

• Sixty-eight percent had improvement in their alcohol problems. 

• Sixty-seven percent had improvement in their drug problems. 

• Fifty-five percent had improvement in their mental health problems. 

• Fifty-five percent had improvement in their social or vocational skill deficits. 

• Fifty percent had improvement in their medical problems. 

However, it was not clear from our review whether the outcome data accurately reflected

veteran status. 

NEPEC Form D discharge data was not always consistent or supportable. Our review of 

VA and GPD records found that in 61 (24 percent) of 251 applicable cases, the clinical 

records did not fully support the responses documented on the Form Ds. In some cases, 

there was not enough information in the clinical record to substantiate the Form D data. 

In other cases, progress notes provided a different, or even contradictory, picture of the 

veteran’s discharge status; these Form Ds usually upgraded the clients’ levels of success 

in the program. By upgrading a veteran’s discharge status, staff could artificially inflate 

performance outcomes of individual GPD programs or of a VAMC’s aggregate 

performance. Program success in meeting or exceeding performance goals is considered 

during the annual inspection and grant renewal process. The following examples 

illustrate our concerns about inaccurate discharge coding and lack of supporting 

documentation: 

• Progress notes at one GPD provider’s program indicated a veteran missed curfew

and failed to return to the GPD. Staff documented their suspicion that the veteran 

relapsed on drugs. The veteran was admitted to a VAMC the following day, and 

physicians documented that the veteran acknowledged using crack cocaine the 

previous day. GPD case managers completed the Form D, indicating that the 

veteran was discharged for “rule violations”; however, VA social workers had 

changed the answer to indicate the veteran became “too ill to participate,” 

presumably because he was admitted to a psychiatry ward for substance abuse and 

depression. The change in Form D information was misleading. 

• GPD case managers completed Form Ds, frequently recording that veterans were 

discharged to independent living in an apartment, room, or house, thus meeting 

criteria for “housed at discharge.” However, we reviewed multiple records, 

primarily from one GPD facility, where progress notes documented that veterans

did not return from pass or simply left the facility, and the GPD had no 

information as to their whereabouts. The GPD case manager told us that if the 

veteran signed out for a visit to a friend or family member’s home, they assumed 

that he was staying with that person and coded that the veteran was housed. This

VA Office of Inspector General 12 
Evaluation of the Veterans Health Administration Homeless Grant and Per Diem Program 

practice falsely increased the GPD performance measure of “housed at discharge” 

because staff could not be certain of this. 

• One veteran was arrested for illegal drug use, but his Form D was coded as 

“substantial improvement” in addressing his drug problems. 

• One veteran was discharged, and later arrested, for assault on staff and other 

residents, yet his Form D was coded as “some improvement” in mental health and 

social deficits. 

In 47 (19 percent) of 252 applicable cases, we found no evidence that the VA-GPD 

liaison or designee reviewed or verified that the information on the Form Ds was correct 

at the time of the veteran’s discharge. While VA clinicians are required to complete 

Form X assessments, GPD clinicians may complete Form D discharge and outcome

reports. In such cases, VA-GPD liaisons or their designees are responsible for reviewing 

and verifying Form D data before submission to NEPEC. In some cases, the liaison’s 

name was typed on the form as having verified the data, but there was no signature or 

initials, nor was there a progress note indicating that they reviewed and verified the 

discharge data. At one site, it appeared that the GPD clinician simply signed the liaison’s 

name to all of the Form Ds. At the sites where liaisons were not verifying Form D 

information, staff confirmed that this practice should be improved. 

The NEPEC Form D had some limitations. The subjective nature of the Form D allows 

clinicians to interpret the questions and answers as they deem appropriate, which may 

lead to inconsistent and unreliable answers. “Success” and “improvement” mean 

different things to different people, and when dealing with the often intractable problems 

associated with homelessness, clinicians (usually social workers) are apt to code a 

discharge status from a “strengths perspective,” meaning to focus on the strengths and 

accomplishments rather than the weaknesses and failures. Consider the case of a veteran 

who has a long history of substance abuse with no significant period of sobriety that 

manages to remain drug and alcohol free for 4 months while in the GPD program. To the 

knowledgeable clinician, this sobriety may represent a major victory; however, coding 

this veteran’s drug problems as “improved” after he relapses and disappears from the 

GPD may be somewhat misleading. Given the same treatment and discharge scenario, 

two social workers assigned to GPD oversight told us that they also would have coded 

this outcome as “improved”; one of them justified his response by saying that the veteran 

now had more resources to deal with his addiction. They both acknowledged, however,

that other social workers might code this outcome differently. 

VA-GPD liaisons are responsible for ensuring that necessary documentation, primarily 

Form X and Form D data, is accurate and provided timely to NEPEC. NEPEC managers 

told us that they must “trust the professional process” and operate on the premise that 

answers on the Form D are accurate, unbiased, and supported by documentation. NEPEC

VA Office of Inspector General 13 
Evaluation of the Veterans Health Administration Homeless Grant and Per Diem Program 

has no authority over the GPD Program to require data validation; staff only aggregate 

and report the information received. 

Issue 1b Conclusion 

The Form D is NEPEC’s method of capturing discharge and outcome data, which is used

as a measure of program performance and effectiveness. As VHA Homeless Program

managers use NEPEC data to make national program decisions and changes, the validity 

of Form D information is paramount, and veterans’ clinical records should accurately 

reflect and support data submitted to NEPEC. 

Recommended Improvement Action 2. The Acting Under Secretary for Health should 

require VHA to ensure that: 

a. VAMCs implement systems whereby VA-GPD liaisons or their designees verify that 

Form D data is accurate and supported by medical record or GPD program 

documentation prior to submission to NEPEC. 

b. VA and GPD staff members receive guidance and training on the meaning of Form D

questions and the acceptable range of interpretations.

Issue 2: Performance Improvement Activities and Oversight Were 

Inadequate 

The objectives of the performance improvement component of the review were to

determine whether (a) facilities evaluated substandard performance of their housing

programs and took actions to improve conditions, and (b) individual GPD programs

achieved program goals as defined in their initial proposals. We identified the following 

conditions requiring management attention. 

NEPEC Data Was Not Reviewed or Discussed With GPD Providers 

VA-GPD liaisons did not routinely share and discuss NEPEC performance data with

individual GPD providers; thus, GPD providers did not develop and implement action 

plans, as appropriate, to address areas where program performance fell below national 

averages. NEPEC publishes quarterly performance data specific to each community 

GPD site. NEPEC reports rank site-specific performance in comparison to other VHA

HCHV Programs in “critical monitor” areas such as housing, employment, and sobriety 

measures. NEPEC states that the average performance of all GPD sites is used as the 

norm for evaluating performance at individual sites. Following is a table which is a 

compilation of data presented in NEPEC’s Health Care for Homeless Veterans

Programs: Eighteenth Annual Report, dated April 15, 2005, which covered FY 2004 

(hereafter referred to as the 2004 NEPEC annual report). The table shows the percentage 

of successful discharges from individual GPD programs in VISN 21, as well as the site 

VA Office of Inspector General 14 
Evaluation of the Veterans Health Administration Homeless Grant and Per Diem Program 

median and national average for successful discharges—the benchmark by which 

performance is measured. In this example, Vet House 1 and Vet House 4 fell well below 

the national average for successful discharges, a condition which should prompt 

performance improvement initiatives and follow-up by GPD providers. 

VISN and National Data for Successful Program Completion 

VISN Site 

Name State Program Name No. of 

Discharges 

No. of 

Successful 

Discharges 

% 

Successful 

National DataSuccessful Completion 

of the Program 

21 A CA Vet House 1 15 4 26.7 

21 A CA Vet House 2 231 178 77.1 

21 A CA Vet House 3 53 30 56.6 

21 A CA Vet House 4 94 37 39.4 

21 A CA Vet House 5 20 11 55.0 

Site Median 52.22% 

National Average 48.20% 

We selected nine evaluation measures as reported in the 2004 NEPEC annual report: 

1. Successful discharge. 

2. Discharge for a violation. 

3. Housed in an apartment, room, or house. 

4. Employed full-time or part-time. 

5. Unemployed. 

6. Improved alcohol problems [at discharge]. 

7. Improved drug problems [at discharge]. 

8. Improved mental health problems [at discharge]. 

9. Improved medical problems [at discharge]. 

Two GPD programs were too new to have reportable outcomes and another was a Service 

Center that was not required to report data to NEPEC.13 Additionally, evaluation data for 

programs that were co-located in the same building were sometimes reported together. 

Thus, we were able to review 2004 NEPEC annual report evaluation data for 26 GPD

programs. 

Of the 234 evaluation measures (9 measures x 26 programs), 63 (27 percent) fell below

national performance averages by more than 5 percentage points. VA-GPD liaisons 

should have reviewed and discussed NEPEC results with GPD providers, who in turn

should have implemented corrective actions or documented the reasons that actions were

not indicated. However, we found no documented evidence of discussions or corrective 

actions relative to 56 (89 percent) of the 63 sub par measures. 

 13 The goal of the Service Centers is to provide services to the hard-to-reach homeless population in a low-demand, 

non-intrusive environment; there are no uniform reporting requirements. 

VA Office of Inspector General 15 
Evaluation of the Veterans Health Administration Homeless Grant and Per Diem Program 

In fact, 13 (59 percent) of 22 GPD providers

14 interviewed told us that they did not

review or discuss quarterly NEPEC data with VA-GPD liaisons, and many were unaware 

that this evaluation data was available. The VA-GPD Liaison at one site was unaware

that NEPEC data include GPD program-specific information related to clinical measures; 

she thought that the data was aggregated by facility and VISN. 

National GPD Program officials and HCHV program managers told us that because GPD

programs differ widely in their approaches to serving homeless veterans, and many tailor 

services to meet specific needs (that is, the program may be designed to serve chronically 

mentally ill homeless people and does not focus on employment), NEPEC data may not

always be comparable across programs because of the divergent focuses and populations. 

However, the data could be useful for individual GPD providers to track their own 

performance across previous quarters and years and to take corrective actions as needed. 

A basic tenet of performance improvement requires benchmarking, either against similar 

programs or against oneself, if no similar program exists. 

GPD Proposal Goals Were Not Adequate, Monitored, or Followed Up 

VHA Directive 2002-072 requires that VHA officials ensure that GPD funded 

community providers are operating the programs as outlined in the original GPD grant 

proposals that were funded. VHA has defined several important goals in its efforts to 

eradicate homelessness in the veteran population and requires GPD applicants to address 

these goals in their applications for funding. VHA’s top three goals for GPD providers 

are to (1) promote greater self-determination of participants, (2) increase the skill level 

and/or incomes of the participants, and (3) enhance residential stability of the 

participants. Each GPD proposal identifies program-specific activities and performance 

measures in support of these goals. We identified the following weaknesses: 

GPD provider goals were not always realistic, consistent, or measurable. Some GPD

providers were challenged with self-imposed but unachievable goals. The following 

cases illustrate the need to revise and update some providers’ proposal goals: 

• One GPD provider who specialized in substance abuse services had a goal to “Provide 

follow-up case management and support services, in the form of home visits, 

emergency services and intervention, counseling, peer group activities, and other 

programmatic services, for 100 percent of all former residents, during the first year 

after a resident moves to their next permanent residence.” Given the nature and 

complexity of homelessness, it is unlikely that this goal could be achieved. 

• Another GPD provider had three grants that all detailed different goals to achieve 

residential stability, increased income/skills, and greater self-determination. 

 14 Some GPD providers, such as the Salvation Army, operated multiple GPD sites; however, the management team

was the same for all sites. 

VA Office of Inspector General 16 
Evaluation of the Veterans Health Administration Homeless Grant and Per Diem Program 

However, the provider operated the program as a continuum across grants and 

facilities. Given the fluid nature of veteran movement across the continuum, 

monitoring of goals and outcomes was virtually impossible. 

• A third GPD provider identified a goal stating that the program would “Assist the 

veterans to locate and secure approved apartment, community residential care homes

and/or boarding homes...” but did not define the number or percentage of veterans to 

be referred, the time frame for doing so, or the anticipated number of veterans

expected to be housed. 

One drawback of the proposal and funding process is that, once funding is approved, 

GPD providers are committed to the scopes of service and performance goals outlined in 

their proposals. From a grant management perspective, this is a valid expectation. 

However, GPD programs work with a fluid and evolving population—primary problems

of 3 years ago may no longer be issues because of changing demographics or improved 

community services. Likewise, performance goals that were reasonable then may not be 

achievable now (for example, a reliable community employer of GPD veterans may have 

gone out of business). On occasion, GPD providers may need to modify the scope of 

service and performance goals of their programs to respond to the changing needs of 

homeless veterans. 

The National GPD Program Office staff told us that scope changes were rare because the 

scope of the services and the associated performance goals, among other criteria, were 

used to determine where the GPD provider ranked nationally with their proposal, which 

in turn impacted whether the grant request was funded. Approval for changes in scope is 

contingent upon the application ranking remaining high enough after the approved

change to have been competitively selected for funding in the year the application was

selected. This caveat reflects the complexity of securing approval for changes in scope.

To minimize the number of GPD providers needing changes in scope, National GPD

Program Office staff should carefully review proposal goals before funding is approved. 

Neither VISN, VAMC, nor community GPD managers routinely monitored GPD 

providers’ performance in relationship to the original grant proposal goals. The GPD

Liaison Guide, issued in March 2004, states that, “Each year by regulation the awardee as 

part of your inspection provide you with a review of how they are meeting their goals and 

objectives as stated in the grant (38 CFR 61.80 (14) (c)). Your Network Homeless 

Coordinator (CNHC) was sent a project management database. This database contains 

the goals, objectives, and measures that awardees proposed to ascertain their project 

success. It is the individual CNHC and liaison’s job to maintain the database.” 

None of the CNHCs or VA-GPD liaisons we talked to were maintaining a project

management database of GPD goals and performance measures as required, and six of 

eight VA-GPD liaisons confirmed that they did not monitor their GPD programs’ 

performance goals. While the VA social workers conducting the annual GPD inspections 

VA Office of Inspector General 17 
Evaluation of the Veterans Health Administration Homeless Grant and Per Diem Program 

occasionally referenced the GPDs’ goals, the inspection files generally did not contain 

documentation supporting performance results. Usually, the social workers simply stated 

that the GPD programs were able to provide the services as listed in their grant proposals. 

All of the GPD executive directors interviewed told us that they monitored their 

performance goals, but we found that most providers only tracked basic data, including 

admissions, discharges, or the number of homeless veterans who secured jobs. Although 

we included 32 GPD programs in our sample, several of those programs were co-located 

with and shared performance goals with “sister” programs operated by the same GPD 

provider. In addition, one GPD program was too new to have measurable outcomes. 

Thus, we were able to review performance goals for 27 GPD programs. Of these, 17 (63 

percent) GPD providers could not provide us with performance reports that specifically 

tracked each of the activities and goals outlined in their proposals. One GPD clinical 

manager told us that he had not read the grant proposals, stating that the proposals were 

written before he took his position. Another GPD executive director told us that he 

“...never looked at the goals in reality to the services...” and never rewrote the goals 

from the original grant request, which dated back to 1998. 

GPDs did not initiate corrective actions when they failed to meet performance goals. We 

evaluated the performance and outcomes of the 10 programs that could provide evidence 

of performance monitoring. Each program had defined from one to three goals related to 

the core objectives of self-determination, increased skill level/income, and residential 

stability. We found that 24 (35 percent) of the 69 goals reviewed were not achieved

during the rating period; in 22 (92 percent) of the 24 cases, we found no evidence of

performance improvement activities to enhance outcomes. 

Issue 2 Conclusion 

VAMC staff and GPD providers did not participate in basic activities to improve program 

performance. NEPEC performance data was not routinely shared with or reviewed by the 

GPD providers, so substandard performance was not identified and addressed. 

Additionally, VA and GPD employees did not consistently monitor whether GPDs were 

meeting their performance goals as defined in their original grant proposals. 

Performance monitoring is the basis for performance improvement; when performance is 

not meeting established goals, corrective actions may be indicated. Without performance 

monitoring and improvement, clinical managers have no assurance that veterans are 

receiving appropriate services in accordance with program guidelines. Additionally, VA

GPD staff could not be assured that GPDs were providing all of the services for which 

they were funded. 

VA Office of Inspector General 18 
Evaluation of the Veterans Health Administration Homeless Grant and Per Diem Program 

Recommended Improvement Action 3. The Acting Under Secretary for Health should 

require VHA to ensure that: 

a. VA-GPD liaisons share and review NEPEC data with GPD providers quarterly and 

document discussions and corrective action plans accordingly. 

b. National GPD Program Office managers should ensure that technical assistance on

how to write measurable and achievable goals is available to GPD providers. 

c. VA-GPD liaisons or designees ensure that GPD providers are monitoring 

performance in relation to proposal goals and require GPDs to develop performance 

improvement activities to enhance outcomes. 

Issue 3: GPD Inspection Deficiencies Were Not Always Corrected 

GPD providers served veterans in facilities encompassing a broad range of new 

construction, recently renovated, or never renovated buildings. Some GPDs were in 

well-designed structures with new furnishings and artwork; others were in older buildings 

with structural deficiencies and donated furniture. Four GPDs operated beds and services 

in leased buildings on VAMC campuses, and a majority of the remaining GPD programs 

were located within a 10-mile radius of the VAMC of jurisdiction. Four GPD programs 

were 40 miles or more from the VAMC; one of those GPDs was about 250 miles from 

the VAMC. 

Overall, we found that VAMCs complied with CFR guidelines and VHA Directive 

2002-072, requiring VAMC officials to conduct GPD facility inspections upon initiation 

of GPD contracts and yearly thereafter. There were 32 GPD programs in our sample; 

however, we only reviewed inspection reports for 28 GPD facilities because some 

programs were co-located in the same building. At 27 of 28 facilities, inspections were 

completed within the past 12 months, and the inspections were usually conducted by 

appropriate interdisciplinary team members, as required. A majority of the GPD 

programs visited were clean and well maintained. However, we noted that follow-up of 

identified deficiencies required VAMC management attention, as follows: 

VAMC inspection team members and other responsible employees did not routinely 

ensure that GPD inspection deficiencies were corrected. According to inspection reports, 

inspection team members identified environmental deficiencies in 20 (71 percent) of 28 

GPD facilities. We toured all 28 GPDs to determine whether the cited deficiencies were 

corrected and to assess the current conditions of the buildings and grounds. During our 

tours, we found that of the 20 GPDs where deficiencies were cited, 9 (45 percent) GPD

providers had not corrected all of the conditions identified in the most recent inspection

survey. In fact, five GPD providers told us that they were unaware of some or all of the 

deficiencies, as no one on the inspection team had communicated the findings to them. 

VA Office of Inspector General 19 
Evaluation of the Veterans Health Administration Homeless Grant and Per Diem Program 

In one GPD, we found significant deficiencies dating back to 1999 that had not been

corrected at the time of our site visit in 2005. The GPD provider leased a building on the 

VAMC campus. The building, built in 1910, required significant structural repairs and

upkeep, many of which were identified during the initial walk-through inspection in 1999

conducted by VAMC and GPD managers. The VAMC and the GPD spent 6 years 

debating who had primary responsibility for repairing sagging floors, loose and missing 

tiles, broken and leaking showers, and steam heat and ventilation problems. During our

tour, we observed that these conditions still existed and also noted standing water in the 

basement and one bedroom that had been closed due to mold from a steam leak. We 

notified VAMC managers of our concerns, and corrective actions were initiated. 

VAMC staff did not adequately address deficiencies identified by a contractor 

completing fire safety inspections. At one VAMC, contractors completed most of the fire 

safety inspections for the VA Inspection Team. The VAMC’s Safety Officer told us that 

he reviewed and approved all inspection reports submitted by the contractor before 

sending them to the Inspection Team leader for processing. The contractor completed 

five of six15 inspections in 2005, and often noted non-compliance with some fire safety

standards as outlined on the VA’s Safety Inspection Report for Existing Small Residential 

Board and Care Facilities.

16 During one inspection, the contractor used a check sheet to 

cite deficiencies that included lack of sprinkler systems, insufficient fire drills, and 

inadequate smoke partitions. Despite this, the VAMC Safety Officer did not question 

anything in the contractor’s report as he attached his own memorandum, indicating that

“No life safety code deficiencies were noted.” The Safety Officer confirmed that he 

should have reviewed the report more carefully before endorsing its contents. 

VAMC staff did not always monitor current environmental conditions and ensure that

deficiencies were corrected. While VA Inspection Teams only visit GPD facilities 

annually, VAMC staff usually visit facilities weekly or monthly. This schedule allows 

the VA-GPD liaison or VA social worker to observe environmental conditions in the

facilities on a regular basis and ensure that GPD managers promptly correct deficiencies 

rather than waiting for the next annual inspection. At the times of our site visits, we 

found environmental conditions that could have placed veteran health or safety at risk. In 

addition to the environmental concerns found at the VAMC-based GPD noted above, we 

also found the following conditions at different facilities: 

• Mold on restroom ceilings, missing electrical face plates in a ladies restroom/shower, 

a missing drain grate and standing water in the drain, broken ceiling and floor tiles, 

and unclean conditions in the kitchenette area. 

 15 The VAMC had oversight responsibility for seven GPD programs; however, one program was co-located in the

same building and required just one inspection. 16 National Fire Protection Association (NFPA) 101–2003. 

VA Office of Inspector General 20 
Evaluation of the Veterans Health Administration Homeless Grant and Per Diem Program 

• Outdated dry goods in the pantry (July 2003—more than 2 years old) and some

expired items in the refrigerator, including milk 14 days past expiration. 

• Deteriorating ceilings in two bedrooms that were at risk for falling. 

• A leaking water heater, a hanging smoke detector, and a light dangling from the 

ceiling. 

Issue 3 Conclusion 

In general, the GPD facilities we visited were clean and comfortable. While VAMC 

inspection teams completed inspections as required, several of the VAMCs had not 

established procedures to follow up on deficiencies and ensure that corrective actions 

were taken in a timely manner. Because VA is frequently a primary oversight body for 

GPD facilities, the inspection process is critical to the safety and well being of the 

resident veterans.17 We notified VAMC managers and GPD providers of these 

uncorrected deficiencies during our site visits so that they could take appropriate actions. 

Recommended Improvement Action 4. The Acting Under Secretary for Health should 

require VHA to ensure that: 

a. All deficiencies identified by inspection teams are corrected and that inspection files

reflect these actions. 

b. Inspection team members communicate their findings and recommendations to GPD

providers. 

c. VAMC staff monitor and follow up on the inspection work of contractors. 

d. VA-GPD liaisons or their designees conduct environmental rounds during their 

regularly scheduled site visits to identify obvious hazards or other deficiencies which 

could be addressed promptly. 

Issue 4: VA-GPD Liaisons Did Not Provide Sufficient Oversight of 

Program Operations 

VA-GPD liaisons did not always perform functions, as required, to ensure proper 

oversight of clinical care, grant compliance, administrative operations, and fiscal 

controls. VHA Directive 2002-072 outlines specific operational and staffing 

requirements for the GPD Program. The VA-GPD liaison is designated by the VAMC 

Director to function as the point of contact between the programs in the field and the 

National GPD Program Office. The VA-GPD liaison monitors GPD program functions 

 17 Additional entities that might inspect GPD facilities could include local fire and health departments. 

VA Office of Inspector General 21 
Evaluation of the Veterans Health Administration Homeless Grant and Per Diem Program 

to ensure that GPD providers are administering the programs as outlined in their grant 

proposals. 

We found that the single most important factor in the quality and success of individual 

GPD programs was the knowledge, involvement, and oversight of the VA-GPD liaison 

and the relationship he or she had built with the GPD provider. Seven of the eight VAGPD liaisons interviewed were assigned part-time to GPD activities, with primary or 

collateral duty assignments for the remainder of their time. According to National GPD

Program Office staff, in the past 2 years, VHA has approved funding for 92 full-time 

VA-GPD liaisons, but approximately half of those positions have not been filled. We 

found that while some VA-GPD liaisons we spoke to were clearly knowledgeable about 

their roles, others appeared uninformed about program and role expectations. VHA

Homeless Program officials acknowledged that the quality of the VA-GPD liaison’s 

oversight varies greatly from site to site. 

In previous sections of this report, we discuss deficiencies and make recommendations to

ensure that VA-GPD liaisons consistently: 

• Collect, verify, and submit Form X and Form D information to NEPEC. 

• Review and discuss NEPEC outcome data with GPD providers. 

• Monitor GPD providers’ program goals. 

In addition, we noted the following conditions: 

Confidential financial disclosures were not always completed. Three of eight liaisons 

told us that they had not filed annual confidential financial disclosures (CFDs). CFDs are 

filed by select VA employees to minimize the potential for conflicts of interest arising 

from employee financial interest in public or private corporations. 

The accuracy of GPD provider per diem invoices was not verified. Some VA-GPD 

liaisons did not verify the accuracy of GPD providers’ per diem invoices. We found 

errors in per diem invoices from 26 (81 percent) of the 32 programs reviewed. Errors 

included both understatement and overstatement of the number of bed days of care 

provided and computational mistakes. These conditions occurred because the VA-GPD 

liaisons only conducted cursory reviews of per diem invoices and did not verify the

computational accuracy of the invoices or the number of days claimed by comparing per 

diem invoices to sign-in logs. VA policy requires VA-GPD liaisons to verify admission 

and discharge dates and the eligibility of program participants along with certifying per 

diem invoices for accuracy based on supporting documentation. According to 4 (50 

percent) of the 8 VA-GPD liaisons, they did not always verify per diem invoices for 

accuracy because they trusted the GPD providers would comply with guidelines and 

applicable regulations. Our review found that 207 (24 percent) of the 864 per diem 

VA Office of Inspector General 22 
Evaluation of the Veterans Health Administration Homeless Grant and Per Diem Program 

invoices received during FYs 2003–2005, valued at about $13 million, had errors of 

which 68 ($48,000) were related to overpayments and 139 ($25,000) to underpayments. 

The total amount of errors attributable to inaccurate invoice certification was about 

$73,000 ($48,000 + $25,000), or less than 1 percent of the $13 million paid to the 

providers. While the amount is not material to the overall program costs, these errors 

demonstrated a lack of oversight by the VA-GPD liaisons. We also identified 

overpayments due to inaccurate establishment of per diem rates. (See pages 24–29 on 

financial review of GPD providers.) 

Some incidents involving GPD veterans were not reported to VAMC management or the 

National GPD Program Office. The National GPD Program Office had not provided VAGPD liaisons with guidance on how to report incidents involving GPD veterans, so most 

liaisons reported following their VAMC’s incident reporting procedures. Overall, it 

appeared that the system worked adequately and that most incidents occurring in GPDs 

or involving GPD veterans were reported appropriately. However, we identified the 

following incidents that, in our opinion, should have been reported to VAMC

management for follow-up, but were not. 

• A resident with complex medical problems fell and hit his head at the GPD facility. 

He was taken to a local hospital where he remained in a coma until his death 1 week 

later. While it appeared that the GPD staff were in contact with the veteran’s family

immediately, VA social workers were not notified of the accident until 3 days later. 

At least two VA social workers and a VA transfer nurse knew about the incident, but 

no one reported the case to the VAMC Quality Manager. 

• A GPD resident with a history of violent outbursts threatened a VA social worker to

the point of chasing her to her car where she locked herself in. Police arrested the 

veteran. The VAMC Quality Manager was notified of the incident but told the social 

work staff that since the event did not occur on VA property and no one was harmed,

an incident report was not indicated. While perhaps technically accurate, the event 

should have at least been reviewed by the VAMC’s Disturbed Behavior Committee to

determine whether action was needed. 

Incident reporting is an important function as it: (1) ensures that appropriate clinicians

and managers are made aware of significant incidents involving veterans, (2) allows for 

individual and aggregate reviews which can lead to improved services and processes, and 

(3) is an integral part of a facility’s risk management strategy. 

Issue 4 Conclusion 

VA-GPD liaisons play a critical role in the day-to-day management of the GPD Program. 

We determined that some VA-GPD liaisons were not adequately performing all of their 

VA Office of Inspector General 23 
Evaluation of the Veterans Health Administration Homeless Grant and Per Diem Program 

administrative and quality assurance functions, resulting in less than optimal data 

integrity, fiscal controls, and performance improvement. 

Recommended Improvement Action 5. The Acting Under Secretary for Health should 

require VHA to ensure that: 

a. All VA-GPD liaisons file CFDs annually. 

b. VA-GPD liaisons appropriately certify invoices prior to payment. 

c. Incidents involving GPD veterans are reported to VAMC and National GPD Program 

officials. 

Financial Controls 

Community GPD providers are awarded per diem funding to offset operational costs, 

including salaries of program employees. Per diem payments may not exceed the VA

State Home daily rate for domiciliary care, which at the time of our review was $29.31. 

The National GPD Program Office has overall responsibility for program operations and 

approves GPD providers’ per diem rates based on assessments of their accounting 

systems and estimated costs by VAMC fiscal staff. The National GPD Program officials 

distribute per diem funds to VAMCs quarterly for disbursement to community GPD

providers. The VA-GPD liaisons are to verify GPD providers’ invoices prior to making 

per diem payments. 

The objective was to determine whether VAMC management was providing appropriate 

monitoring and oversight of GPD programs as required by the OMB Circulars A-87, 

A-122, and A-133; and VHA Directive 2002-072 and Handbook 1162.01. We also 

reviewed the GPD providers’ administration of the program to determine whether: 

• Per diem rates were appropriate. 

• Accounting systems properly accumulated, segregated, and reported costs under the 

GPD program. 

• Costs incurred were eligible for reimbursement under Federal regulations and 

applicable cost principles. 

We found that the accounting systems for the GPD providers we reviewed generally met 

OMB requirements regarding accounting for program funds and allocations of costs. 

While we did not test transactions in detail, we did find that the categories of cost 

VA Office of Inspector General 24 
Evaluation of the Veterans Health Administration Homeless Grant and Per Diem Program 

included in the per diem rate calculations appeared appropriate and necessary.18 

However, GPD providers’ per diem rates were frequently overstated because accounting 

data was not properly used in computing their per diem rates. We found some GPD

providers did not report all non-VA revenue, or their estimated costs were significantly 

higher than prior year actual costs. VAMC staff did not identify these errors because 

they were not knowledgeable about OMB Circulars A-87, A-110, and A-133 or the

requirements to perform reviews of GPD providers’ financial management accounting 

systems and financial and budgetary data. We also found that some GPD providers were 

not knowledgeable about how to complete the Funds Assurance Letters (FAL) and 

supporting schedules.19

Issue 5: Overstated GPD Providers’ Per Diem Rates Resulted In 

Overpayments 

Per diem rates were overstated because the GPD providers either did not deduct non-VA

revenue from their programs’ expenses, understated revenue, or overestimated their 

program costs when submitting their requests to the National GPD Program Office for 

per diem rates. As a result, we found that the 32 programs we reviewed were overpaid 

about $1.5 million or about 11.2 percent of the $13 million paid to the 32 programs 

during FYs 2003–2005. The overpayments of per diem reimbursements for some GPD 

providers went undetected because National GPD Program officials did not have 

procedures in place, prior to March 1, 2006, to conduct incurred cost reviews of GPD 

providers. VAMC staffs responsible for assessing GPD providers’ requests for per diem

and their financial data did not identify miscalculations or inaccurate estimates when 

conducting their reviews. Also, procedures for reviewing per diem rates during the

annual renewal process frequently did not ensure that all non-VA revenue was reported 

or significant variances between estimated and actual expenditures were detected. 

During FYs 2003–2005, the GDP Program officials awarded about $128.5 million in per 

diem payments to GPD providers that operated 309 different programs. Per diem 

payments and reviews of the GPD providers’ financial information were the 

responsibility of 95 different VAMCs. During our review, we visited 8 VAMCs and

reviewed 32 programs operated by 22 GPD providers that received about $13 million in 

per diem payments during FYs 2003–2005. 

In performing the review, we analyzed the GPD providers’ FALs, which documented 

their estimated program operating costs that were the basis for their per diem rates, to 

determine whether the approved per diem rates were correct. We compared the FALs 

 18 Invoices and journal entries supporting costs reported in the audit financial statements were not tested. However,

we compared total amounts in the financial statements to the total amounts in the general ledgers and trial balances

to determine if they agreed. 

19 FAL and supporting schedules are GPD Program documents that identify estimated and actual project revenue 

and costs used to determine the recipient’s per diem reimbursement rates. 

VA Office of Inspector General 25 
Evaluation of the Veterans Health Administration Homeless Grant and Per Diem Program 

and supporting schedules to the GPD providers’ independently audited financial 

statements to determine whether estimated costs in the FALs were consistent with the 

actual costs incurred. Using the actual costs from audited financial statements, general 

ledgers, and trial balances, we recalculated the per diem rates to determine if GPD 

providers’ established per diem rates were accurate. 

Our analysis found that per diem rates for 20 (63 percent) of 32 programs were overstated

by an average of $8.75, ranging from $.25 to $22.25. As a result, these programs were 

overpaid approximately $1.5 million,20 ranging from $1,024 to $291,726 per program.

Overpayments to 5 of the 20 programs totaled more than $100,000 each. The following

table shows the number of programs monitored by each VAMC and the number of GPD 

providers overpaid. 

Summary of GPD Provider Overpayments 

Supervising VAMC 

Programs

Supervised 

Programs

Overpaid 

Amount 

Paid 

Amount

Overpaid 

Percent 

Overpaid 

A 1 1 $ 669,354 $ 120,753 18.0%

B 3 1 2,251,705 51,165 2.3%

C 1 0 187,811 0 0.0%

D 4 0 1,169,535 0 0.0%

E 3 3 3,104,368 394,279 12.7%

F 10 9 2,707,204 507,008 18.7%

G 3 2 607,923 26,544 4.4%

H 7 4 2,322,727 353,635 15.2%

Total 32 20 $ 13,020,627 $ 1,453,384 11.2%

The following are examples of the conditions identified: 

• A GPD provider submitted a FAL for FY 2004 showing non-VA revenue of $27,500, 

but the Schedule A to the FAL showed estimated non-VA revenue of $146,442. 

VAMC fiscal staff did not detect this error when reviewing the request for per diem, 

resulting in the per diem rate being $5.37 ($26.95 – $21.58) higher than what should 

have been awarded. This caused the GPD provider to be overpaid about $137,000. 

• A second GPD provider allocated about $1.5 million in costs for employment, legal, 

and supportive services to the GPD Program and other non-VA programs; however,

in FY 2005 the GPD provider did not deduct $1.4 million in revenue attributable to

these programs. As a result, about $160,000 in costs were inappropriately allocated to 

the GPD Program. The GPD provider used this same methodology in their previous

per diem submissions. During the period July 2003 through September 2005, the 

GPD provider was overpaid about $292,000, most of which was attributed to the 

misallocation of these costs. In conducting the annual review, VAMC fiscal review 

 20 Underpayments were negligible. 

VA Office of Inspector General 26 
Evaluation of the Veterans Health Administration Homeless Grant and Per Diem Program 

staff should have determined whether this revenue had been appropriately applied to

the benefiting programs. 

• A third GPD provider’s cost estimate ($535,050) for their FY 2004 per diem rate was 

48 percent higher than their actual FY 2003 expenditures ($361,231) with no increase 

in services or beds. In analyzing the various elements of cost for FYs 2003 and 2004,

we found that the GPD provider included $44,029 for food and $133,946 for client

assistance. However, actual expenses for these items totaled only $22 and $4,155, 

respectively. During FYs 2003 and 2004, this GPD provider was overpaid about 

$121,000. The difference between the overestimates and overpayments is attributed 

to cost increases in other elements of expense. VAMC fiscal review staff should have 

identified the significant differences between estimated and actual expenses when

performing the annual review. 

• A fourth GPD provider submitted a FAL for FY 2005 without showing all non-VA 

revenue. The GPD provider estimated $134,811 in non-VA revenue, while their FY 

2004 income statement showed actual non-VA revenue of $444,320. In reviewing the 

FY 2005 audited income statement, we found the actual non-VA revenue was

$447,145. The GPD provider under reported non-VA revenue by about 300 percent 

for FY 2005. This resulted in the GPD provider being paid a per diem rate of $27.19 

instead of $9.63, causing an overpayment of about $81,000. The GPD provider also 

did not deduct the appropriate amount of non-VA revenue for FYs 2003 and 2004,

which resulted in an overpayment of about $51,800. VAMC fiscal review staff 

should have identified the additional non-VA revenue not reported on the FAL 

supporting schedule when performing the annual review. 

These overpayments resulted from the GPD provider not deducting non-VA revenue 

from their program expenses, understating revenues, or overestimating their program

costs. However, these overpayments were not detected because the National GPD 

Program officials and VAMC fiscal officers, who supervise the fiscal review staffs, did 

not ensure adequate reviews of the GPD providers’ accounting data were conducted 

during the initial and subsequent annual inspections. Discussion with VAMC fiscal 

officers disclosed that some fiscal review staffs were not familiar with OMB Circulars 

A-122 and A-133 audit procedures and did not have the expertise to perform these types 

of assessments. According to National GPD Program officials, they rely on VAMC

fiscal review staffs to ensure the accuracy of the FALs. 

Annual assessments by VAMC staff of FALs and comparisons of actual costs incurred to 

approve per diem rates have not been effective. VAMC fiscal review staffs were not 

properly trained or supervised to perform the annual assessments. Most VAMC fiscal

officers we interviewed saw these responsibilities as ancillary duties that stretched their 

limited fiscal staff resources. Assessments were cursory in nature and usually performed 

in only 1 or 2 days. Some fiscal officers told us that their staffs were not familiar with 

VA Office of Inspector General 27 
Evaluation of the Veterans Health Administration Homeless Grant and Per Diem Program 

OMB requirements. One assistant fiscal officer stated that the OMB circulars were like 

reading “Greek” and that his staff was not qualified to conduct the annual assessments. 

We also interviewed VAMC fiscal review staffs that conducted the annual assessments

and found they generally could not explain the methods they used in evaluating the GPD

providers’ accounting systems and how they determined whether the requested per diem 

rates were appropriate. Five of the eight fiscal review staffs did not maintain work papers 

documenting their assessments. 

A new VHA GPD handbook was issued. Prior to March 1, 2006, the VA’s GPD 

Program Liaison Guide was the primary guidance provided to VAMC fiscal officers 

concerning their oversight responsibility of homeless providers. The guide requires that

the VAMC fiscal staffs annually review GPD providers to ensure that their accounting 

systems meet generally accepted accounting principles and that they properly segregate

costs to the appropriate cost centers, projects, or awards. 

On March 1, 2006, VHA distributed a GPD Handbook which formally issued the Fiscal

Review Guide21 to VAMC staffs, which replaced the interim guide. The new guidance 

requires a comparison of current budget and actual costs for the previous year’s operation 

and is more detailed than previous guidance. In addition, the new guidance instituted an 

incurred cost review requirement that GPD providers submit actual costs for the fiscal 

year. The actual costs will be compared to the estimated costs used to approve the per 

diem rates. If the actual costs result in per diem rates that are less than the approved

rates, the GPD providers will be required to reimburse the overpayments to VA. 

According to National GPD Program officials, under this new guidance, VAMC fiscal 

review staffs will be responsible for conducting assessments of FALs and completing 

incurred cost reviews of GPD providers. In our opinion, the inadequate assessment of the

FALs identified in our review raises serious questions about VAMC fiscal review staffs’ 

ability to adequately conduct incurred cost reviews. In order to properly conduct incurred 

cost reviews, the fiscal review staffs should be trained on how to perform audits of the 

GPD providers’ financial statements and related ledger accounts and trial balances. 

In January 2005, training was provided on the draft Fiscal Review Guide during the 

Fiscal Officers Annual Training Conference in Nashville, TN. In January 2006, the 

VISN Fiscal Quality Assurance Managers (FQAM) received training on their 

responsibilities to ensure that VAMC fiscal review staffs adequately assess FALs and 

conduct incurred cost reviews of non-profit organizations. None of the training was 

specific to the steps required to perform reviews of the FALs or the incurred costs 

reviews that the new guidance requires. Also, according to National GPD Program 

officials, the Fiscal Review Guide training is provided to VISNs on an “as requested” 

 21 The GPD Program Liaison Guide included guidance that was similar but not as detailed as the Fiscal Review 

Guide. 

VA Office of Inspector General 28 
Evaluation of the Veterans Health Administration Homeless Grant and Per Diem Program 

basis. As of March 2006, only five VISNs had received the training, eight VISNs were

scheduled for training this FY, and the remaining eight VISNs had not been scheduled.

Consequently, there are no assurances that VAMC fiscal review staffs in these VISNs

will ever be trained to perform effective reviews of the FALs and incurred costs reviews. 

Issue 5 Conclusion 

VAMC monitoring and oversight of GPD providers was inadequate. Financial 

assessments were not properly conducted and did not identify errors in the computation 

of approved per diem rates. Assessments did not identify all non-VA sources of revenue 

or detect significant differences between estimated and actual costs, resulting in GPD 

providers being overpaid. We found 20 (63 percent) of the 32 programs we reviewed 

were overpaid approximately $1.5 million. Failure to identify inaccurate information in 

the FALs during the per diem approval process can result in the GPD provider being 

overpaid. This could, in turn, result in the program ceasing operations and the veterans 

having to be placed elsewhere. 

These errors occurred because VAMC fiscal review staff were not familiar with OMB 

requirements, and according to some fiscal officers, they were not qualified to conduct 

annual assessments. In our opinion, in order to ensure that per diem rates are accurately 

established and incurred cost reviews are properly conducted, financial oversight of GPD

providers should be centralized to an appropriate office whose staff is trained and 

competent to audit GPD providers. This action would ensure accurate establishment of 

per diem rates and consistent oversight of GPD providers. However, because of VHA

concerns about centralization, we agreed that VHA could take other measures to correct 

the problem. 

Recommended Improvement Action 6. We recommend the Acting Under Secretary for 

Health: 

a. Review the financial oversight of GPD providers to ensure that per diem rates are 

accurately established and incurred cost reviews are properly conducted. 

b. Consult with General Counsel to determine the appropriateness and cost-effectiveness 

of initiating collection actions on overpayments. 

Issue 6: Corrective Actions Following a Previous GPD Assessment 

Were Insufficient 

In 2002, the OIG initiated an investigation of an allegation that a former VA-GPD 

Liaison was simultaneously the Chief Executive Officer for a non-profit organization 

(recipient) receiving VA grant and per diem payments (Audit of the VA Homeless 

Veterans Transitional Housing Grant to Tampa-Hillsborough Action Plan, Inc., Tampa, 

VA Office of Inspector General 29 
Evaluation of the Veterans Health Administration Homeless Grant and Per Diem Program 

Florida, Report No. 02-03372-101, issued March 8, 2006). As part of the investigation, 

the OIG conducted a review to determine if overall GPD management controls were 

adequate and operating to ensure that VA grant and per diem assistance were used by the 

recipient to provide transitional housing to homeless veterans. The OIG review identified

nine areas where the management controls of the GPD Program needed strengthening to 

adequately safeguard program resources. Additionally, during the investigation, VHA 

assembled a Management Improvement Team (MIT) compromised of VHA officials,

including the VHA Chief Financial Officer, Financial Assistance Office, and the GPD 

Program Office. The MIT examined the organizational structure and fiscal and program 

accountability of the GPD Program and identified 27 control weaknesses and system

deficiencies. The deficiencies identified by the OIG and MIT occurred because GPD 

Program managers had not provided clear guidance to the recipient concerning their 

operational responsibilities and accountability for GPD funds; also they did not manage 

the program in compliance with OMB Circulars A-110, A-122, and A-133. As a result, 

the GPD Program overpaid the recipient almost $600,000 for costs that were not 

allowable or were not incurred. 

To avoid compromising the criminal investigation, OIG did not issue a report at that time. 

Nevertheless, the OIG and VA’s MIT brought many of the deficiencies identified in this 

review to the attention of VA and GPD Program management. The results of the OIG 

and MIT reviews were discussed with GPD managers during an October 2002 meeting in 

Washington, DC, that included the VA Homeless Coordinator, senior VHA HCHV

Program officials, and representatives from General Counsel, the MIT, and OIG. 

Subsequently, GPD Program managers reported taking corrective actions to strengthen 

management controls. However, we determined during our current review that, while 

some actions taken were appropriate, other actions were not properly implemented or

were otherwise ineffective in resolving the conditions, as follows: 

• Action Taken According to GPD Officials: Specific instructions have been

included in the application package that explain the difference between donations and 

discounts and the regulations that apply to each. 

OIG Assessment of Action Taken: Specific instructions were not added to the grant

capital application package (First and Second Submissions) specifically addressing 

the difference between donations and discounts and the regulations that apply to each. 

The GPD provider evaluated during our 2002 OIG review used price discounts 

(applicable credits) which are specifically prohibited by OMB Circular A-122 instead 

of donations (services received) to meet their matching requirements for the 

acquisition and rehabilitation of property to be used to house homeless veterans (grant 

funding). Purchase discounts offset or reduce expense items that are allocable to 

awards as direct or indirect cost and should be credited to the Federal government

either as a cost reduction or cash refunds. While our review did not focus on grant 

funding, the difference between donations and discounts can have a significant impact 

VA Office of Inspector General 30 
Evaluation of the Veterans Health Administration Homeless Grant and Per Diem Program 

on determining the GPD provider’s matching requirement for the acquisition and 

rehabilitation of property to be used for transitional housing or service centers. 

Therefore, specific instructions should have been included in the application package 

that explain the difference between donations and discounts and the regulations that 

apply to each. 

• Action Taken According to GPD Officials: An auditor was hired to review grant

applications and per diem budgets, train VAMC fiscal staff to perform audits of GPD 

providers’ financial and payroll records, verify the GPD providers’ indirect cost 

allocation methodologies, and perform onsite GPD provider audits. 

OIG Assessment of Action Taken: The National GPD Program Office hired an 

auditor in May 2003 to assist with the assessment of FALs and incurred cost reviews. 

However, the National GPD Program officials delegated the primary responsibility of 

conducting FALs and incurred costs review assessments to the VAMC staffs. 

Reviews conducted by the VAMC staffs have not been effective as evidenced by the 

overpayments we identified. We were informed by VAMC fiscal management 

officials that the VAMC fiscal staffs have not been adequately trained nor are they 

qualified to conduct assessments of FALs or incurred cost reviews. (See pages 24–29 

on financial review of GPD providers.) 

• Action Taken According to GPD Officials: A tracking system has been 

implemented to ensure that GPD providers have annual audits and that National GPD

Program staff compares the financial information in those audit reports with the per 

diem budgets submitted to the National GPD Program Office. 

OIG Assessment of Action Taken: During our review, we found that the GPD 

providers had annual audits of their financial statements. However, the National GPD 

Program officials delegated the primary responsibility of conducting FALs and

incurred costs review assessments to the VAMC staffs. Reviews conducted by 

VAMC staffs have not been effective as evidenced by the overpayments we 

identified. (See pages 24–29 on financial review of GPD providers.) 

• Action Taken According to GPD Officials: Training seminars have been developed 

for VA-GPD liaisons, VAMC staff, and GPD provider staff. 

OIG Assessment of Action Taken: The National GPD Program Office has not 

developed an integrated training program to ensure that all staff having oversight 

responsibility for the program have been properly trained. We found only limited

training had been provided to VAMC staff on how to perform annual assessment of 

FALs and incurred costs reviews. 

• Action Taken According to GPD Officials: VA-GPD liaisons are required to 

submit annual financial disclosure statements and receive annual ethics training. 

VA Office of Inspector General 31 
Evaluation of the Veterans Health Administration Homeless Grant and Per Diem Program 

OIG Assessment of Action Taken: The GPD Liaison Handbook has a provision that

requires the VA-GPD liaison to submit Form 450, Confidential Financial Disclosure 

Report, to the Office of General Counsel. Our review found that VA-GPD liaisons 

usually received annual Ethics training, but did not always submit the required 

financial disclosures. (See pages 21–24 for VA-GPD liaison responsibilities.) 

• Action Taken According to GPD Officials: The GPD Liaison Handbook was

rewritten to include a checklist for initial and annual inspections, along with 

procedures to ensure that all rehabilitation work was actually completed. 

OIG Assessment of Action Taken: The GPD Program Liaison Handbook does 

include a checklist for initial and annual inspections. However, there are no 

procedures to ensure that all rehabilitation work was actually completed. 

• Action Taken According to GPD Officials: The MIT has performed onsite audits at 

nine GPD homeless veteran transitional housing projects nationwide and has

additional audits scheduled through the end of FY 2003. 

OIG Assessment of Action Taken: According to the National GPD Program Office, 

onsite reviews have been performed at about four to six GPD providers. The MIT 

conducted the audits of the GPD providers during their evaluation of the GPD 

Program. However, the evaluation was not issued because the office was reorganized. 

Issue 6 Conclusion 

Although National GPD Program officials had been informed of control weaknesses and 

system deficiencies through VA’s MIT assessment and OIG work, they did not fully 

implement corrective actions to resolve identified conditions. In several instances, the 

corrective action was initiated, but National GPD Program officials did not follow 

through to ensure that: (a) VAMC staff were trained and qualified to perform the 

necessary fiscal functions, (b) revised policies and guidelines addressed all of the 

corrective action elements, and (c) systems were in place to ensure that GPD site audits

would continue after the MIT’s reorganization. 

Recommended Improvement Action 7. We recommend that the Acting Under 

Secretary for Health require the National GPD Program officials: 

a. Fully address deficiencies identified by internal and external reviews. 

b. Track corrective actions through resolution. 

c. Evaluate the effectiveness of those actions. 

VA Office of Inspector General 32 
Evaluation of the Veterans Health Administration Homeless Grant and Per Diem Program 

Issue 7: The National GPD Program Office Did Not Provide 

Adequate Oversight of GPD Operations 

While not a specific objective of our review, VHA oversight of the GPD Program is a 

critical component of effective operations. We determined that VHA’s National GPD

Program Office did not provide adequate oversight of some GPD operations, nor did it 

provide timely and consistently accurate guidance to VAMC GPD staff at the eight 

VAMCs we visited. Many of the deficiencies identified at the individual VAMC and 

GPD levels could be traced back to inadequate oversight, guidance, and in some cases,

enforcement of existing policies by the National GPD Program Office. The following 

matrix shows deficiencies outlined in previous sections of this report and the National 

GPD Program Office’s role in obviating or correcting the conditions. 

Deficiency National GPD Program Office Role 

Form Xs were not always completed and

forwarded to NEPEC. 

Enforcement of requirement to adequately complete all evaluation 

forms. 

NEPEC data was not reviewed or discussed

with GPD providers. 

Follow-up with VA-GPD liaisons whose GPDs are performing

below national averages. 

Proposal goals were not always realistic,

consistent, or measurable.

Thorough review of proposals to assure appropriateness of

performance goals; provision of technical assistance to grant

writers on how to write meaningful program goals. 

VISN and VAMC staff did not monitor

proposal goals.

Provide the project management database to appropriate staff,

educate them on its use, and ensure that GPDs not meeting

performance targets are reviewed for quality improvement 

purposes. 

VAMC staff did not ensure that all inspection 

deficiencies were corrected. 

Require VA-GPD liaisons to certify that inspection deficiencies 

are corrected within an established period of time. 

VA-GPD liaisons did not perform all

administrative or quality assurance functions. 

Issue guidance and provide training on all aspects of the VA-GPD

liaison’s responsibilities. 

Corrective actions from a previous GPD

review were not initiated or were not effective. 

Implement corrective actions in a timely manner and follow up on 

conditions to ensure that actions were effective. 

Overpayments of per diem reimbursements for

some GPD providers went undetected because 

the National GPD Program Office did not 

have procedures in place to conduct costincurred reviews. 

Review VAMC fiscal staff assessments of the FALs to ensure that

they were properly conducted.

VA Office of Inspector General 33 
Evaluation of the Veterans Health Administration Homeless Grant and Per Diem Program 

In addition, we found that the National GPD Program Office allowed a GPD provider to 

change the scope of their program and offer short term lodging (30 days) to GPD

veterans, contrary to the GPD Program mission to provide transitional housing. 

The National GPD Program Office granted a change of scope to a GPD provider but did 

not adequately document the rationale for the approval, which appeared inconsistent with 

the GPD mission. The GPD was originally funded to provide 12 transitional housing 

beds with appropriate social services. However, VA clinical managers had requested that

the GPD designate eight of these beds as “detoxification beds,”22 where veterans 

enrolled in VA’s outpatient Substance Abuse Treatment Center (SATC) could stay for 30 

days pending completion of SATC treatment. These veterans were then referred to 

community halfway house programs where beds may or may not be available. SATC

clinical staff provided the treatment and case management services; the GPD did not

provide any clinical services. In January 2000, a member of the National GPD Program 

Office staff conducted a site visit at the request of the GPD provider because of concerns 

about the program’s structure. The National GPD Program official informed VA 

personnel that the GPD program was “...not designed to create ‘boarding beds’ 

exclusively for VA use...”; rather, it was for transitional housing and services. The 

program official outlined several options to address these issues. Shortly thereafter, the 

GPD provider requested a change of scope that proposed providing eight beds to veterans 

for a “...shorter period of time, usually 3–5 days.” 

The National GPD Program official approved the change of scope,23 despite this change 

being contrary to the GPD mission to provide transitional housing for up to 2 years. We 

found three cases where veterans successfully completed SATC (and 30 days in the 

GPD), yet the discharge summaries referenced the need of those veterans to seek 

employment, address legal issues, and/or live with relatives pending halfway house 

placement. These are the types of psychosocial issues that would normally be addressed

during transitional housing placement. Also, the original proposal goals were never 

changed to match the new service approach, nor were the per diem payments altered to 

reflect the reduction in clinical services for veterans residing in the eight short-term 

detoxification beds. 

This is significant because we noted during our site visits that many GPD providers have 

initiated a “phased” approach to service provision similar to the GPD site noted in the 

above example. Specifically, providers may offer a 10-day drug detoxification program

to be followed by a 30-day residential treatment component. This approach, however, 

would only meet GPD Program guidelines if residential treatment were followed by a 

transitional housing placement for up to 2 years. The National GPD Program Office

needs to ensure that GPD programs are operated and services are delivered in a manner 

that supports the GPD mission. 

 22 They only provided room and board in a substance-free environment. 23 Approved April 4, 2004, via facsimile. 

VA Office of Inspector General 34 
Evaluation of the Veterans Health Administration Homeless Grant and Per Diem Program 

Issue 7 Conclusion 

The National GPD Program Office did not provide adequate guidance or oversight to 

VAMCs with GPD programs, did not enforce existing policies, nor did it ensure that VA 

GPD staff had the necessary training and resources to perform their administrative and 

clinical functions. The GPD Program has grown significantly over the past 12 years,

from 44 programs in 1994 to 309 programs in 2006, yet the 5-person composition of the 

National GPD Program Office has remained virtually the same. It appears that the 

existing National GPD Program Office infrastructure has been unable to support the 

program growth. While the sizable increase in GPD beds has undoubtedly furnished 

homeless veterans with more housing and treatment services, the lack of clear guidance 

and oversight in some areas placed those same veterans, as well as GPD programs, at risk

for poor outcomes that may have been preventable. 

Recommended Improvement Action 8. The Acting Under Secretary for Health should 

require VHA to ensure that the National GPD Program Office meets the operational and 

oversight requirements of this rapidly expanding program.

Comments 

VHA Comments 

VHA responded that it agreed with the OIG report findings and concurred with all 

recommendations. Although VHA agreed that GPD per diem rates should be accurately 

established and incurred cost reviews should be properly conducted (Recommendation 

6.a.), they stated that a final plan to address this issue is dependent on the outcome of a 

review of possible alternatives. 

VHA said they are finalizing a statement of work for solicitation of an expert consultant 

to evaluate the current GPD program/process—especially as it relates to financial 

oversight. The solicitation will include a requirement for the development of alternative 

options for program management. They further stated that the timetable for the 

availability of the final VHA plan is dependent on the responses to the solicitation. 

However, they stated that they would propose that the deliverable (the options document) 

be completed within 6 months after award, with the timetable for implementation to be 

dependent on the strategy selected. 

The Acting Under Secretary for Health’s memo stated that the National GPD Program is 

not accountable for all aspects of care for homeless veterans, but primarily with providing 

transitional housing and supportive services associated with psycho-social issues related

to the patient’s homelessness. The National GPD Program Office provides guidance to

medical centers through VHA policy documents, training, conference calls, designated

intranet sites, site visits, and teleconferences, with the Northeast Program Evaluation 

VA Office of Inspector General 35 
Evaluation of the Veterans Health Administration Homeless Grant and Per Diem Program 

Center charged with providing a global evaluation of the needs of homeless veterans, 

supporting program accountability, assessing program effectiveness, and identifying 

ways to improve program outcomes. 

VHA’s position is that since the GPD Program represents a diverse group of programs

that have a common goal of providing flexible housing and supportive services to meet 

the needs of homeless veterans in their communities, local oversight is imperative to 

promote program quality and coordination. In response, VHA’s Office of the Associate 

Chief Consultant for Homeless and Residential Rehabilitation and Treatment Programs 

will monitor the implementation of corrective actions planned in addressing the 

remaining recommendations in this report and provide OIG future reports of that 

assessment. 

In their action plan, VHA further stated that it would conduct a comprehensive

assessment of the effectiveness of follow-up action items by February 2008. In addition, 

VHA will conduct an assessment of the program’s resource needs and begin making any 

needed adjustments in resources by October 1, 2006. 

The Acting Under Secretary for Health’s response is included in its entirety as 

Appendix A, beginning on page 37. 

OIG Comments 

We will follow up on all planned actions until they are completed. With regard to the

issue of Recommendation 6.a., concerning the issue of accurately establishing GPD per 

diem rates and properly conducting GPD incurred cost reviews, we recognize that VHA 

cannot specify the timetable or completion date until they have selected a strategy from 

among those submitted by the consultant. We will follow up on Recommendation 6.a.

until the strategy has been selected and implemented. 

 

 (original signed by Dana Moore, Deputy Assistant

 Inspector General for Healthcare Inspections for:) 

JOHN D. DAIGH, JR., M.D. 

Assistant Inspector General for 

Healthcare Inspections 

VA Office of Inspector General 36 
Evaluation of the Veterans Health Administration Homeless Grant and Per Diem Program 

Appendix A 

Acting Under Secretary for Health’s Comment 

Department of 

Veterans Affairs Memorandum

Date: August 17, 2006 

From: Acting Under Secretary for Health (10) 

Subject: Evaluation of the Veterans Health Administration Homeless Grant

and Per Diem Program, Project Number 2004-00888-HI-0102

To: Assistant Inspector General for Healthcare Inspections (54) 

1. I have reviewed the draft report, and I concur with the report and 

recommendations. Although VHA agrees that development and implementation 

of a plan to ensure accurate per diem rates and properly conducted cost reviews 

are needed, a final plan to address this issue is dependent on the outcome of a 

review of possible alternatives. 

2. Nonetheless, I appreciate your efforts in highlighting the array of services 

VHA’s GPD Program provides to homeless veterans through its many community 

GPD providers. VA’s partnership with these organizations is an important part of 

what is, overall, the largest integrated network of homeless assistance programs in 

the country. During the past 10 years, over 6,000 transitional housing beds have 

been created in partnership with more than 200 non-profit organizations or local 

government agencies. Progress is being made, but as your report outlines, there is 

more work to be done to ensure appropriate operation and oversight of the

growing GPD Program. In response to the recommendations, the attached action 

plan outlines several actions to be implemented, with others deferred until further 

assessment by VHA is completed. 

3. The report indicates that some basic care activities, provided to homeless 

veteran patients in the collaborative operations with community providers, was

less than optimal, and that further guidance may be needed to clearly define 

responsibility for these key aspects of care. As outlined in the attached action 

plan, VHA will take immediate steps to define these responsibilities, and initiate 

the necessary action to assure that the integrated care is well coordinated by the

Grant and Per Diem Liaisons responsible for program oversight. 

VA Office of Inspector General 37 
Evaluation of the Veterans Health Administration Homeless Grant and Per Diem Program 

4. Your review assigned most program oversight responsibility to the National

GPD program. However, it should be noted that the National GPD Program is not 

accountable for all aspects of care for homeless veterans, but primarily with 

providing transitional housing and supportive services associated with psychosocial issues related to the patient’s homelessness. The National GPD Program 

Office provides guidance to medical centers through VHA policy documents, 

training, conference calls, designated intranet sites, site visits, and teleconferences, 

with the Northeast Program Evaluation Center (NEPEC) charged with providing a 

global evaluation of the needs of homeless veterans, supporting program

accountability, assessing program effectiveness, and identifying ways to improve 

program outcomes. 

5. Further, the report implies that centralized monitoring of the basic patient care

activities and quality of local programs is problematic. Given that the GPD 

Program represents a diverse group of programs that have a common goal of 

providing flexible housing and supportive services to meet the needs of homeless 

veterans in their communities, local oversight is imperative to promote program 

quality and coordination. In response, VHA’s Office of the Associate Chief 

Consultant, Homeless and Residential Rehabilitation and Treatment Programs will 

monitor the implementation of corrective actions planned in addressing the 

remaining recommendations in this report, and provide OIG future reports of that 

assessment. 

6. VHA will continue to assess the oversight and resource needs necessary to

support the rapidly growing Grant and Per Diem Program. Thank you for the 

opportunity to respond to this report. If you have any questions, please contact 

Margaret M. Seleski, Director, Management Review Service (10B5) at (202) 565-

7638. 

 (original signed by:) 

Michael J. Kussman, MD, MS, MACP 

Attachment 

VA Office of Inspector General 38 
Evaluation of the Veterans Health Administration Homeless Grant and Per Diem Program 

Acting Under Secretary for Health’s Comments 

to Office of Inspector General’s Report 

The following Acting Under Secretary for Health’s comments 

are submitted in response to the recommendations in the 

Office of Inspector General’s Report: 

Action Plan in Response to: OIG Draft Report, Evaluation of the Veterans 

Health Administration Homeless Grant and Per Diem Program (EDMS 353706) 

Project No.: 2004-00888-HI-0102 

Date of Report: May 18, 2006 

Recommended Improvement Action 1. The Acting Under Secretary for Health 

should require VHA to ensure that: 

a. VA-GPD liaisons or designees complete and submit Form Xs to NEPEC in

a timely manner. 

Concur 

GPD Liaisons currently submit Form Xs to NEPEC on a monthly basis. Effective 

immediately, NEPEC will track all missing Form Xs on a monthly basis and will 

notify the GPD Liaison and the VISN Homeless Coordinator when a form is 

incomplete or missing. NEPEC will track all missing Form Xs until they are 

received. 

In process July 1, 2006 

 and on-going

b. National GPD Program office staff monitor Form X completion rates by

VAMCs and require consistently underperforming sites to take corrective 

actions. 

Concur 

VHA concurrence is qualified, since, as noted in 1a, compliance with Form X

completion will be monitored by NEPEC on a monthly basis. Monitoring of 

compliance with program evaluation tools is the responsibility of NEPEC, and not 

the GPD Program. NEPEC currently generates a quarterly report to the GPD 

VA Office of Inspector General 39 
Evaluation of the Veterans Health Administration Homeless Grant and Per Diem Program 

Liaisons and the Network Homeless Coordinator. This report provides aggregate 

data on the percentage of Form Xs completed for each GPD Program in their 

Network. 

Effective immediately, the NEPEC quarterly report will be sent to the VISN 

Quality Management Office for review and action. Those Medical Centers that 

fall below a pre-established threshold for timely Form X completion will be 

required to submit a corrective action plan that address deficiencies. The 

corrective action plan will be submitted through the Medical Center Director to 

NEPEC and the GPD Office. Repeated under- performance with Form X 

completion will be identified by NEPEC and will be further addressed through a 

letter from the Associate Chief Consultant, Homeless and Residential 

Rehabilitation and Treatment Services to the VISN Director, the Medical Center 

Director, and the Network Homeless Coordinator where the under performance is 

occurring that will request an outline of actions to be taken to bring up 

performance. 

In process October 1, 2006 

c. VA and GPD provider employees adequately assess veterans’ needs, devise 

treatment plans to meet those needs, and document the case records to reflect 

these services. 

Concur 

VHA concurs with clarification. For those veterans who are case managed by VA

GPD Liaisons, it is imperative that a homeless veteran in the GPD Program have

an initial evaluation, a treatment plan and timely documentation as clinically 

indicated. Documentation must address needs and ongoing documentation of 

progress related to services provided. VHA further clarifies that Form X is not a 

formal assessment or treatment plan. It is a program evaluation tool designed by 

NEPEC to collect baseline contact information from homeless veterans within the 

VHA Healthcare for Homeless Veteran Program (HCHV). Form X’s may be

completed on a veteran prior to admission to a GPD program by VA staff 

conducting outreach. Veterans’ needs identified during outreach may differ from 

their needs at the time of admission to the program; therefore, it is within reason 

that the Form X assessment and the treatment plan are discrepant. 

GPD Liaisons are required to comply with medical center policy and procedures

within the liaison’s discipline, scope of practice, and clinical service line and/or 

VA Office of Inspector General 40 
Evaluation of the Veterans Health Administration Homeless Grant and Per Diem Program 

other clinical guidelines related to assessment, treatment planning, and 

documentation. This documentation is entered into the VA electronic medical 

record. Responsibility for monitoring quality and timeliness of documentation is 

the responsibility of the local medical center. 

According to GPD regulations (38 CFR 61.0), Community providers (Grant 

recipients) are held to standards as put forth in their application; consequently, 

VHA cannot hold GPD community providers accountable to clinical standards 

beyond what is required by this regulation without mutual consent. The GPD 

Liaison and the VA treatment providers will solicit the community provider’s 

participation in VA treatment planning, with every effort made to coordinate the

treatment process between the VAMC and the GPD community provider. 

VHA will enhance the initial and annual inspection authorization and 

documentation to clearly establish responsibility for the provision of services and 

record keeping that includes assessment, treatment plans, and documentation of

requirements performed by the GPD community provider and the VA liaison. 

This agreement will be signed and approved by the Medical Center Director in 

coordination with the GPD Office. The Medical Center Director will be held 

accountable for ensuring that the community based GPD provider offers quality 

services that are in compliance with existing laws, regulations, and standards. The

National GPD Program Office and the Homeless Network Coordinators are 

available as key resources to facilitate this process. The GPD inspection forms 

have been revised for 2006 requiring the Medical Center Director’s signature. 

The VHA GPD office recently hired a clinical manager who will, in consultation 

with the field staff, the Council of Network Homeless Coordinators, and Patient 

Care Services, develop, a Clinical Pertinence Review Tool to be utilized by 

medical centers to monitor liaison compliance with documentation standards.

The program office will develop an USH Information Letter that emphasizes new 

requirements will be sent to the Network Director, Medical Center Directors, 

Network Homeless Coordinators, and liaisons emphasizing new requirements. 

In process September 1, 2006 

d. Clinicians comply with documentation standards regarding frequency of

notes, treatment planning revisions, and veteran progress in the program to 

provide involved staff with an accurate depiction of the veteran’s status. 

Concur 

VA Office of Inspector General 41 
Evaluation of the Veterans Health Administration Homeless Grant and Per Diem Program 

VHA agrees that treatment planning is necessary and essential for veterans care. 

GPD liaisons or their designees are required to comply with medical center and 

regulatory agency documentation requirements. The quality monitoring of the 

documentation is the responsibility of the medical center. The quality 

management office at the local medical center is a primary resource to assure 

compliance with local documentation policies and accreditation standards related 

to the frequency and quality of the documentation. 

While VHA supports timely and consistent documentation and recognizes that 

documentation is an essential tool for promoting integrated and coordinated 

services, VHA cannot hold GPD community providers to be accountable to 

clinical standards outside of what is required by GPD regulations (38 CFR 61.0).

To help ensure providers are operating programs in accordance with their 

proposals, inspection forms have been revised for 2006 to include a requirement 

that providers submit documentations on progress towards meeting their goals and 

objectives as put forth in the grant application. As noted in 1c, VHA will develop 

a Clinical Pertinence Review Tool and send an USH Information Letter to GPD 

Liaisons and Network Homeless Coordinators emphasizing new requirements. 

In process October 1, 2006 

e. Clinicians conduct and document interdisciplinary treatment planning. 

Concur 

VHA concurs with qualification. VHA will encourage that GPD liaisons

participate in interdisciplinary treatment planning and care at their local VA 

medical centers when diagnosis or conditions warrant care that requires

interdisciplinary involvement, and whenever possible and appropriate. Care plans 

will be developed by individual clinicians when interdisciplinary care plans are 

not warranted. VHA clinical documentation is completed in CPRS and in 

accordance with medical center policy and procedures. 

Presently, GPD providers frequently do not have interdisciplinary staff and 

requiring the provider to add interdisciplinary staff to meet this recommendation 

would be both costly and unnecessary. Treatment planning in the community 

based program needs to occur in accordance with specifications noted in the grant 

application or an authorized change of scope. 

VA Office of Inspector General 42 
Evaluation of the Veterans Health Administration Homeless Grant and Per Diem Program 

As noted in 1c and d, VHA will develop a Clinical Pertinence Review Tool and 

send and USH Information Letter to GPD Liaisons and Network Homeless 

Coordinators emphasizing new requirements. 

In process October 1, 2006 

f. VA clinicians review and document agreement with placements and 

treatment plans for those veterans with multiple readmissions. 

Concur 

VHA Handbook 1162.01 states that the Grant & Per Diem Liaison must review

and approve or deny a waiver (for those veterans who have had three or more 

episodes) based on their best clinical assessment of the individual case. All 

readmissions require review and these reviews will be documented in the clinical 

record. The review will include documentation of clinical reasons contributing to 

the need to readmit the veteran. A memorandum for the record stating that a 

waiver has been granted must be forwarded to the GPD office, and recorded in the 

computerized medical record system (CPRS). 

In addition, NEPEC will monitor waiver compliance and ensure that a waiver 

exists for homeless veterans admitted to GPD programs four or more times. If a

waiver is not on file, NEPEC will notify both the medical center and the GPD 

office for corrective action. 

In process October 1, 2006 

Recommended Improvement Action 2. The Acting Under Secretary for Health 

should require VHA to ensure that: 

a. VAMCs implement systems whereby VA-GPD liaisons or their designees 

verify that Form D data is accurate and supported by medical record or GPD 

program documentation prior to submission to NEPEC. 

Concur 

VHA agrees that it is good clinical practice for GPD staff to document client 

outcomes at the time of discharge in CPRS, and that this documentation should be 

consistent with what has been reported on the Form D. Homeless veterans 

enrolled in the GPD program, who are also under VA care (e.g., case management 

while in the HCHV Program) should have relevant information concerning the 

GPD episode entered in their clinical medical center record. 

VA Office of Inspector General 43 
Evaluation of the Veterans Health Administration Homeless Grant and Per Diem Program 

The Form D was designed by NEPEC to describe basic characteristics of the 

veteran’s episode of care in the GPD program including cost, as well as several 

outcomes of program participation such as employment status, housing status, and 

clinical improvement. It is not intended to be a discharge note. The GPD Liaison 

is primarily responsible for accuracy of the discharge report (Form D) data. 

NEPEC requires that each Form D be signed by the individual completing the 

form, and that the GPD Liaison or other VA clinician familiar with the client’s 

care in the GPD program (e.g. another HCHV program clinician) review the Form 

D and indicate concurrence with accuracy of the review by signing the Form. It is 

NEPEC policy to return the unsigned forms to the originating medical center 

liaison. 

An Information Letter will be sent to the VISN Directors, Medical Center 

Directors, Network Homeless Coordinators and Medical Center Liaisons 

emphasizing the importance of documentation in the medical record will be 

generated. A Clinical Pertinence Review Tool will be developed and sent with the 

above mentioned letter to assist facilities with monitoring of staff documentation 

requirements. 

In process October 1, 2006

b. VA and GPD staff members receive guidance and training on the meaning 

of Form D questions and the acceptable range of interpretations. 

Concur 

NEPEC currently provides training on evaluation procedures for all GPD liaisons 

and GPD community providers. Training is conducted via teleconference, and an 

evaluation procedure manual is provided to both GPD liaisons and GPD 

community providers. A primary component of the training is the review of the 

Form D, and the acceptable range of interpretations of Form D responses. When 

GPD providers complete Form Ds, Liaisons will be responsible for training the

providers on Form D completion, and ensuring that providers meet acceptable

standards for Form D completions. Additional training from NEPEC is available 

at the request of the GPD Liaisons. Additional training is often required and 

provided due to staff turnover. 

VHA recognizes the importance of training staff and has initiated a focused 

training for new liaisons related to VHA-GPD Handbook 1162.01 on the GPD

Program. Each VISN has participated in the training and to date, 136 new liaisons 

VA Office of Inspector General 44 
Evaluation of the Veterans Health Administration Homeless Grant and Per Diem Program 

have each received 1.5 days of training. The GPD Office is also working with the 

VA Employee Education Service (EES) to develop a web-based training that will 

provide critical training information related to the rules, regulations, and operating 

principles for the GPD program. GPD will continue the training, with web-based 

training released to the field in December 2006. All liaisons in the GPD program 

will be required to complete this training. EES is developing a specific evaluation 

tool to be implemented in 2007 to monitor the effectiveness of their training, 

including the effectiveness of their web based training. 

In process January 31, 2007 

Recommended Improvement Action 3. The Acting Under Secretary for Health 

should require VHA to ensure that: 

a VA-GPD liaisons share and review NEPEC data with GPD providers 

quarterly, and document discussions and corrective action plans accordingly. 

Concur 

VHA agrees that NEPEC program evaluation data can be used at times to assist

providers’ programs in improving performance. VHA Handbook 1162.01 notes 

under the GPD Liaison training and duties section that a primary responsibility of 

the Liaison is to “monitor periodically throughout the year for compliance to 

ensure the GPD program is being administered as outlined in the grant proposal.” 

This monitoring must include performance reviews. At a minimum, the liaison 

must use NEPEC data, as well as the goals and objectives put forth by the provider

in the grant application, as benchmarks for grant recipient program performance. 

The performance reviews must be documented and the program improvement 

actions, based on these reviews, must be implemented. 

To further promote the implementation of performance based activities within the 

GPD, the liaison will be required to submit a copy of the performance reviews that 

were conducted during the annual inspections to the Medical Center Quality 

Management Office. The Quality Management Office will track the 

recommendations and ensure that they are addressed in subsequent reviews. If 

GPD providers continue to under-perform, the liaison and quality management 

office will notify the Medical Center Director who will establish a correction plan 

to address deficiencies. Corrective action plans may include recommendation to 

suspend funding. A copy of this plan will be forwarded to the GPD and the 

VA Office of Inspector General 45 
Evaluation of the Veterans Health Administration Homeless Grant and Per Diem Program 

Network Homeless Coordinator. Proposed VHA enhancement will be added to 

the GPD Handbook, December 2006. 

In process December 31, 2006 

b. National GPD Program Office managers adequately review proposals for 

measurable and achievable goals prior to funding approval. 

Concur 

VHA is currently authorized by law to award funds to organizations that offer 

technical assistance and has awarded technical assistance grants to community

providers that assist homeless veterans. The awardees of these grants have been 

providing technical assistance to potential and current GPD providers on how to 

write measurable program goals. The GPD office has documentation related to 

the dates and times of these trainings. 

Recent training On-going 

completed June 5, 2006 

c. VA-GPD liaisons or designees ensure that GPD providers are monitoring

performance in relation to proposal goals and require GPDs to develop 

performance improvement activities to enhance outcomes. 

Concur 

VHA Handbook 1162.01 includes a requirement in the Clinical Review portion of 

the yearly inspection for the clinical member of the inspection team to ensure an 

ongoing assessment of the supportive services needed by the residents and the 

availability of such services; and ensure an assessment report addressing the 

providers ability to meet the goals, objectives, measures, and special needs as set 

forth in the application is completed by the provider and submitted with the annual 

GPD inspection report. These new inspection procedures are in place for 2006. 

VHA recognizes the importance of providing quality transitional housing and 

supportive services for homeless veterans. In the VHA Handbook 1162.01, GPD 

provider compliance is the assigned responsibility of the medical center director. 

As stated in section 8.b. of the Handbook, “it is the responsibility of the VAMC 

Medical Center Director to ensure programs are operating as stated and designed 

in the original GPD proposal. Additionally, the VAMC inspection team is 

required on an annual basis to ensure that the provider submits an assessment 

VA Office of Inspector General 46 
Evaluation of the Veterans Health Administration Homeless Grant and Per Diem Program 

report addressing their ability to meet the goals, objectives, measures, and special 

needs as set forth in their application.” 

The GPD Office will monitor enhanced inspection procedures and provide timely

feedback to those sites that are out of compliance. 

In process January 1, 2007

Recommended Improvement Action 4. The Acting Under Secretary for Health 

should require VHA to ensure that: 

a. All deficiencies identified by inspection teams are corrected, and that 

inspection files reflect these actions. 

Concur 

VHA concurs that all deficiencies identified by inspection teams must be corrected 

and inspection files must reflect these actions. The need for enhanced inspection 

procedures was previously identified by the National GPD Program Office and 

these enhanced procedures for corrective actions and due processes have been 

specified in the VHA Handbook 1162.01. These procedures give guidance to 

medical centers on notification of program deficiencies and necessary corrective 

actions. 

The GPD Liaison will be required to submit a copy of the inspection reports that 

include deficiencies to the medical center Quality Management Office. The 

Quality Management Office will track the deficiencies and ensure that they are 

addressed in a timely manner. Once deficiencies have been addressed, the Quality 

Management Office will forward a report of completion to the National GPD

Program Office. 

In process January 1, 2007

b. Inspection team members communicate their findings and 

recommendations to GPD providers. 

Concur 

VHA addressed this recommendation in VHA Handbook 1162.01, in the section, 

“Program Inspections”. VA FORM 10-0361c, VA Homeless Providers Grant and 

Program Inspection Package Checklist, provides the opportunity for the GPD

Liaison and other inspection team members to communicate findings and 

VA Office of Inspector General 47 
Evaluation of the Veterans Health Administration Homeless Grant and Per Diem Program 

recommendations to the medical center director as well as the GPD provider staff. 

The report is then filed with the National GPD Program Office. 

VA-GPD Liaisons will be instructed to submit copies of the inspection report 

documents to the GPD provider after these reports have been approved and signed 

by the medical center director. An addendum will be included in the VHA

Handbook 1161.01, December 2006. 

In process January 1, 2007 

c. VAMC staff monitor and follow up on the inspection work of contractors. 

Concur 

VHA concurs that all deficiencies identified by inspection teams must be corrected 

and inspection files must reflect these actions. Procedures for corrective actions 

and due processes have been specified in the VHA Handbook 1162.01. These

procedures give guidance to VAMCs on notification of program deficiencies and 

necessary corrective actions. 

In process January 1, 2007 

d. VA-GPD liaisons or their designees conduct environmental rounds during 

their regularly scheduled site visits to identify obvious hazards or other 

deficiencies which could be addressed promptly. 

Concur 

VHA concurs with qualification. We recognize the importance of care being 

provided in a safe environment. If a liaison identifies an environmental hazard as 

part of the routine visit to the program, it is his responsibility to inform the GPD

provider regarding the safety concern. It should be noted that it is also the 

liaison’s responsibility to comply with medical center policy and procedures 

related to reporting safety, environmental hazards, other patient care concerns and 

or allegations of impropriety. A copy of this contact should then be documented 

to the GPD file. 

GPD Liaisons will be reminded quarterly on the conference calls regarding the 

importance of reporting obvious hazards in accordance with their medical center 

policies. 

In process October 1, 2006 

VA Office of Inspector General 48 
Evaluation of the Veterans Health Administration Homeless Grant and Per Diem Program 

Recommended Improvement Action 5. The Acting Under Secretary for Health 

should require VHA to ensure that: 

a. All VA-GPD liaisons file CFDs annually. 

Concur 

VHA requires GPD Liaisons to file confidential financial disclosures (CFDs), as 

specified in VHA Handbook 1162.01, “As part of the initial designation and 

annual re-designation, the VA Liaison is required to comply with the provisions of 

“Confidential Filer” regulations and submit to the Office of General Counsel Form 

450, Confidential Financial Disclosure Report, to ensure there is no actual or 

apparent conflict of interest between the liaison and the provider organization....”

Regional Counsels are accountable to ensure GPD liaisons file these disclosures, 

and the liaisons are provided with the necessary accompanying training. 

VHA will work with the 22 Regional Counsel offices to ensure that all GPD 

liaisons complete their annual CFD. The GPD Office will request that Regional 

counsels provide certification on an annual basis, that GPD liaisons have 

completed their CFD’s if this is not deemed by OGC to be a violation of their 

confidential filer status. 

In process October 1, 2006 

b. VA-GPD liaisons appropriately certify invoices prior to payment. 

Concur 

VHA agrees that liaisons must appropriately certify invoices prior to payment. 

The VHA Handbook 1162.01 expands and further specifies the liaison’s

responsibilities with regard to establishing review billing documentation. It is 

under the authority and the responsibility of the medical center director to ensure 

these processes are in place. 

Liaison training and web-base training will address this issue. Reminders will also

be provided as needed on the Liaison Monthly Conference Call. 

In process October 1, 2006 

VA Office of Inspector General 49 
Evaluation of the Veterans Health Administration Homeless Grant and Per Diem Program 

c. Incidents involving GPD veterans are reported to VAMC and National

GPD Program officials. 

Concur 

VHA agrees that incidents involving GPD veterans should be reported to the 

VAMC and the national GPD program office. This issue is addressed in the 

recently published VHA Handbook 1162.01, under “Special Reporting 

Circumstances.” The GPD Handbook recommends that medical centers 

incorporate GPD-funded programs into a critical incident reporting procedure. 

VHA policy requires that yearly data from these reporting procedures be 

submitted to the GPD Office for review. The medical center director or his

designee is responsible for ensuring compliance with this procedure.

When the GPD Office becomes aware of failure to notification, the Associate 

Chief Consultant Homeless and Residential Rehabilitation and Treatment Services 

will send a letter to the medical center director for further follow up and review. 

In process Immediately 

Recommended Improvement Action 6. We recommend the Acting Under 

Secretary for Health: 

a. Review the financial oversight of GPD providers to ensure that per diem

rates are accurately established and incurred cost reviews are properly

conducted.

Concur 

VHA concurs in concept with the recommendation of developing and 

implementing a plan to ensure that per diem rates are accurately established and 

incurred cost reviews are properly conducted.

VHA is finalizing a statement of work for solicitation of an expert consultant to

evaluate the current GPD program/process -- especially as it relates to the financial 

oversight. The solicitation will include a requirement for the development of 

alternative options for program management. The Office of Intergovernmental 

Affairs has been consulted and concurs with this approach. 

The timetable for the availability of the final VHA plan is entirely dependent on 

the responses to the solicitation. VHA will certainly propose that the deliverable 

VA Office of Inspector General 50 
Evaluation of the Veterans Health Administration Homeless Grant and Per Diem Program 

(the options document) be completed within 6 months after award. The timetable 

for the implementation is dependent on the strategy selected. 

b. Consult with General Counsel to determine the appropriateness and costeffectiveness of initiating collection actions on the $1.4 million in 

overpayments. 

Concur 

The collection of the amount estimated by OIG must be validated through audit

procedures established through the GPD and VA Office of Finance. Collection 

actions cannot be taken until the identified community providers are given an 

opportunity for due process. VHA will initiate appropriate action, as agreed upon 

by the Office of General Counsel, depending on the outcome of VHA validation 

and due process for community providers. 

In process January 1, 2007 

Recommended Improvement Action 7. We recommend that the Acting Under 

Secretary for Health require the National GPD Program officials: 

a. Fully address deficiencies identified by internal and external reviews. 

b. Track corrective actions through resolution. 

c. Evaluate the effectiveness of those actions. 

Concur 

OIG notes in their report on page 30 that they did not provide a report of the

review of the GPD program during a 2002 review of a non-profit organization, to

avoid compromising a criminal investigation of the provider. An MIT review 

conducted at that time did result in seven observations, and 27 suggestions. Most 

of the MIT suggestions were accepted and those that warranted action were 

implemented. VHA acknowledges the value of addressing deficiencies, tracking 

corrective actions and evaluating the effectiveness of those actions. VHA agrees 

that quality planning, efficient quality control, and quality improvement are 

essential to offering effective services. VHA will address the comprehensive 

findings documented in this report by ensuring that actions are specified and 

tracked, and that evaluation systems are implemented. Target dates have been 

VA Office of Inspector General 51 
Evaluation of the Veterans Health Administration Homeless Grant and Per Diem Program 

established for policy clarification and enhancement, training and continuous 

monitoring. The Office of the Associate Chief Consultant, Homeless and 

Residential Rehabilitation and Treatment Programs will fully address the 

deficiencies identified and accepted in this report, establish a tracking system for 

corrective action of those deficiencies, and evaluate the effectiveness of all actions 

within one year of implementation. It should be noted that some actions will

require policy changes and hiring additional staff, necessitating a longer period 

than usual for assessing the effectiveness of actions taken. 

In process February 1, 2008 

Recommended Improvement Action 8. The Acting Under Secretary for Health 

should require VHA to ensure that: 

The National GPD Program Office meets the operational and oversight 

requirements of this rapidly expanding program.

Concur 

VHA concurs with qualification. The OIG auditors assigned most program 

oversight responsibility to the National GPD Program Office; however, authority 

and responsibility for a significant portion of program oversight is assigned to the 

local medical centers, as delineated in the GPD Directive 2002-72 (rescinded), and 

further specified in VHA Handbook 1162.01 published March 2006. VHA does 

not agree that a significant policy change to assign most oversight functions to the 

National Program Office is in the best interests of homeless veterans or our 

community partners. Local oversight is imperative to promote program quality

and coordination of the diverse group of programs providing services to homeless 

veterans in their community. Assigning most oversight functions to the National 

Program Office would result in more distant, and therefore, less effective 

management of quality patient care and program monitoring activities. 

VHA will address the comprehensive findings documented in this report by 

ensuring that actions are specified and tracked, and that evaluation systems are 

implemented by the Office of the Associate Chief Consultant, Homeless and 

Residential Rehabilitation and Treatment Programs. Target dates have been 

established for policy clarification and enhancement, training and continuous 

monitoring. VHA will also conduct a comprehensive assessment of the 

effectiveness of follow-up action items by February 2008. In addition, VHA will 

conduct an assessment of the program’s resource needs and begin making any 

needed adjustments in resources by October 1, 2006. 

In process February 1, 2008

VA Office of Inspector General 52 
Evaluation of the Veterans Health Administration Homeless Grant and Per Diem Program 

Appendix B 

OIG Contact and Staff Acknowledgments 

OIG Contact Victoria Coates, Director 

Atlanta Regional Office of Healthcare Inspections 

404-929-5962 

Acknowledgments Christa Sisterhen 

Toni Woodard 

Susan Zarter 

Floyd Dembo 

Al Tate 

Earl Key 

Melissa Colyn 

VA Office of Inspector General 53 
Evaluation of the Veterans Health Administration Homeless Grant and Per Diem Program

Appendix C 

Report Distribution 

VA Distribution

Office of the Secretary 

Veterans Health Administration 

Assistant Secretaries 

General Counsel 

Non-VA Distribution

House Committee on Veterans’ Affairs 

House Appropriations Subcommittee on Military Quality of Life and Veterans Affairs 

House Committee on Government Reform

Senate Committee on Veterans’ Affairs 

Senate Appropriations Subcommittee on Military Construction and Veterans Affairs 

Senate Committee on Homeland Security and Governmental Affairs 

National Veterans Service Organizations 

Government Accountability Office 

Office of Management and Budget 

This report will be available in the near future on the OIG’s Web site at 

http://www.va.gov/oig/52/reports/mainlist.htm. This report will remain on the OIG Web 

site for at least 2 fiscal years after it is issued. 

VA Office of Inspector General 54