[Federal Register Volume 74, Number 131 (Friday, July 10, 2009)]
[Proposed Rules]
[Pages 33192-33196]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E9-16341]


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DEPARTMENT OF VETERANS AFFAIRS

38 CFR Part 59

RIN 2900-AM70


Grants to States for Construction or Acquisition of State Home 
Facilities--Update of Authorized Beds

AGENCY: Department of Veterans Affairs.

ACTION: Proposed rule.

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SUMMARY: The Department of Veterans Affairs (VA) proposes to amend its 
regulations regarding grants to States for construction or acquisition 
of State homes to update the maximum number of nursing home and 
domiciliary beds designated for each State and to amend the definition 
of ``State'' for purposes of these grants to include Guam, the

[[Page 33193]]

Northern Mariana Islands, and American Samoa.

DATES: Comments must be received on or before September 8, 2009.

ADDRESSES: Written comments may be submitted by: Mail or hand-delivery 
to Director, Regulations Management (02REG), Department of Veterans 
Affairs, 810 Vermont Avenue, NW., Room 1068, Washington, DC 20420; fax 
to (202) 273-9026; or e-mail at http://www.regulations.gov. Comments 
should indicate that they are submitted in response to ``RIN 2900-
AM70--Grants to States for Construction or Acquisition of State Home 
Facilities--Update of Authorized Beds.'' All comments received will be 
available for public inspection in the Office of Regulation Policy and 
Management, Room 1063B, between the hours of 8 a.m. and 4:30 p.m., 
Monday through Friday (except holidays). Please call (202) 461-4902 for 
an appointment. (This is not a toll-free number.) In addition, during 
the comment period, comments may be viewed online through the Federal 
Docket Management System (FDMS) at http://www.regulations.gov.

FOR FURTHER INFORMATION CONTACT: James F. Burris, MD, Chief Consultant, 
Geriatrics and Extended Care State Home Construction Grant Program 
(114), Veterans Health Administration, Department of Veterans Affairs, 
810 Vermont Avenue, NW., Washington, DC 20420, (202) 461-6774.

SUPPLEMENTARY INFORMATION: Congress has authorized VA to provide grants 
to States for the construction or acquisition of State home facilities 
for the provision of care to veterans. See 38 U.S.C. 8131-8138. The 
term ``State home'' means ``a home established by a State (other than a 
possession) for veterans disabled by age, disease, or otherwise who by 
reason of such disability are incapable of earning a living'' and 
``includes such a home which furnishes nursing home care for 
veterans.'' 38 U.S.C. 101(19). For purposes of State home grants, the 
term ``State'' means each of the several States and Territories of the 
United States, the District of Columbia, and the Commonwealth of Puerto 
Rico, see 38 U.S.C. 101(20), but not possessions of the United States, 
see 38 U.S.C. 101(19), 8131(2). The Department of the Interior, which 
has administrative responsibility for coordinating Federal policy in 
Island groups in the Insular Area, has identified Guam and American 
Samoa as territories of the United States, and the Northern Mariana 
Islands as a Commonwealth in Political Union with the United States, 
which is treated as a U.S. territory for purposes of the State home 
grant program, see VAOPGCCONCL 10-98. The regulatory definition of the 
term ``State'' in current 38 CFR 59.2 already includes the several 
States, the District of Columbia, the Commonwealth of Puerto Rico, and 
the Virgin Islands. We propose to amend this definition to include 
Guam, the Northern Mariana Islands, and American Samoa.
    Section 8134(a)(2) of title 38, U.S.C., mandates that VA prescribe 
for each State the number of nursing home and domiciliary beds for 
which grants may be furnished, which the proposed note to 38 CFR 
59.40(a) would refer to as a State's ``unmet need'' number. To compute 
this number, VA estimates for each State the maximum number of nursing 
home and domiciliary beds needed by veterans in that State (which is 
the maximum number of such beds designated for each State, as shown on 
the chart in proposed Sec.  59.40(a)), and then subtracts the number of 
existing State home beds plus the number of those beds under 
construction or that would be constructed in accordance with the 
State's grant applications. In addition, section 8134(a)(3) mandates 
that VA prioritize State home grant applications. The priorities set 
forth in the law require VA to compute whether a State applying for a 
grant has a great, significant, or limited need for State home beds. VA 
currently uses a State's ``unmet need'' number to determine whether the 
State has a great, significant, or limited need for new State home 
beds. See 38 CFR 59.50(e).
    The Veterans Millennium Health Care and Benefits Act (the ``Act'') 
(Public Law 106-117, enacted on November 30, 1999) requires that, not 
less often than every four years, VA must review and, as necessary, 
revise the regulations concerning the maximum number of State home beds 
designated for each State. 38 U.S.C. 8134(a)(4). Section 8134(a)(2) 
requires that these numbers be based on the projected demand for 
nursing home and domiciliary care on November 30, 2009 (10 years after 
the date of enactment of the Act) by veterans who at such time are 65 
years of age or older and who reside in that State. In 2001, VA 
originally established the maximum number of State home beds for each 
State based on the projected demand for such beds in 2009. See 66 FR 
33845-46 (June 26, 2001). VA now believes that Congress intended VA to 
recalculate the maximum number of beds for each State based on the 
projected demand for care ten years in the future and that this method 
would be consistent with the Act's requirement for establishing maximum 
State home bed numbers. VA thus proposes to revise in proposed Sec.  
59.40(a) the maximum bed numbers based on the projected demand from 
veterans who, in 2020, are 65 years of age or older and who reside in 
that State.
    To compute the maximum number of beds for each State in compliance 
with the Act, we first estimated the total number of veterans 65 years 
of age or older residing in each State, projected to the year 2020. We 
then totaled the projected population of these veterans at 8,672,045, 
which would be an increase from the 2000 projected population of such 
veterans in 2009. In computing these estimates, we considered many 
factors, such as movement of these veterans to new States, the 
mortality rate of these veterans, and the fact that the life expectancy 
of these veterans is projected to be longer than before. We then 
considered the projected total demand for nursing home and domiciliary 
beds in State homes. In 2000, we estimated the demand in 2009 would be 
for 55,299 State home beds nationwide. We believe that this estimated 
demand may also be used for 2020, despite the estimated increase in the 
projected veteran population, due to the many emerging alternatives to 
institutional long-term care and advancing technologies, such as 
Telehealth, Home-Based Primary Care, and Respite Care, and due to the 
fact that veterans are choosing to stay longer in their own homes. VA's 
philosophy is to provide extended care services in the least 
restrictive environment that is safe for the veteran, and whenever 
possible in non-institutional home and community-based settings. VA now 
provides a spectrum of non-institutional extended care services 
including home telehealth, homemaker/home health aide, skilled home 
care, home-based primary care, adult day healthcare, in-home respite 
care, and hospice and palliative care that were unavailable or not 
widely available in 2000. VA has been increasing the capacity to 
provide these services in recent years and will continue to do so in 
order to meet the demand. Many similar services are now available in 
the private sector through Medicare/Medicaid and long-term care 
insurance, and some veterans will choose to avail themselves of those 
services rather than seeking care from VA. The non-institutional 
services make it possible for many veterans who would otherwise require 
nursing home care to remain in their own homes, and reduce the need for 
additional nursing home beds. New technologic advances that may become 
available over the next decade, such as robotic assistive devices, will 
also reduce the need for additional nursing home beds. It is

[[Page 33194]]

likely that these trends will offset the growth in population and mean 
that no additional nursing home beds will be needed beyond those 
previously projected. Should these assumptions prove incorrect, VA will 
adjust the total number of beds in a future revision of this 
regulation. ``We are specifically interested in comments concerning 
this analysis and our estimate that the demand in 2020 for State home 
beds will be for 55,299 nationwide.
    We allocated the 55,299 beds based on the percentage of veterans 
who in 2020 are projected to reside in each State. Although the 
projected total demand for State home beds nationwide will remain the 
same in 2020, some States will experience an increase and other States 
a decrease in the maximum number of beds that are eligible to receive a 
grant from the State Veterans Home Construction Grant program depending 
on the projected population of veterans 65 years of age or over for 
each State. The table below shows the changes in the maximum numbers of 
beds for each State. We would welcome comments regarding our 
projections for individual States.

----------------------------------------------------------------------------------------------------------------
                                                                                  New max <greek-
                                                                                    i>  of beds
                     State                          Old max <greek-i> of beds     (based on 2020  Difference  (+/
                                                                                    projections)        -)
 
----------------------------------------------------------------------------------------------------------------
Alabama.......................................  883.............................            1007             124
Alaska........................................  79..............................             179             100
American Samoa................................  not applicable..................               0               0
Arizona.......................................  1068............................            1520             452
Arkansas......................................  557.............................             653              96
California....................................  5754............................            4363           -1391
Colorado......................................  717.............................            1114             397
Connecticut...................................  738.............................             559            -179
Delaware......................................  165.............................             207              42
DC............................................  104.............................              83             -21
Florida.......................................  4471............................            4049            -422
Georgia.......................................  1202............................            1975             773
Guam..........................................  not applicable..................              12              12
Hawaii........................................  216.............................             268              52
Idaho.........................................  233.............................             394             161
Illinois......................................  2271............................            1754            -517
Indiana.......................................  1209............................            1216               7
Iowa..........................................  632.............................             578             -54
Kansas........................................  542.............................             518             -24
Kentucky......................................  759.............................             818              59
Louisiana.....................................  785.............................             638            -147
Maine.........................................  301.............................             362              61
Maryland......................................  1020............................            1102              82
Massachusetts.................................  1348............................             944            -404
Michigan......................................  1896............................            1786            -110
Minnesota.....................................  932.............................            1058             126
Mississippi...................................  500.............................             480             -20
Missouri......................................  1230............................            1257              27
Montana.......................................  198.............................             281              83
Nebraska......................................  355.............................             371              16
Nevada........................................  428.............................             649             221
New Hampshire.................................  264.............................             361              97
New Jersey....................................  1683............................             992            -691
New Mexico....................................  344.............................             417              73
New York......................................  3220............................            2209           -1011
North Carolina................................  1454............................            1900             446
North Dakota..................................  121.............................             137              16
Northern Mariana Islands......................  not applicable..................               1               1
Ohio..........................................  2530............................            2143            -387
Oklahoma......................................  747.............................             766              19
Oregon........................................  804.............................             907             103
Pennsylvania..................................  3173............................            2336            -837
Puerto Rico...................................  350.............................             288             -62
Rhode Island..................................  254.............................             157             -97
South Carolina................................  750.............................            1089             339
South Dakota..................................  155.............................             179              24
Tennessee.....................................  1050............................            1311             261
Texas.........................................  3226............................            4119             893
Utah..........................................  304.............................             426             122
Vermont.......................................  124.............................            1312            1188
Virginia......................................  1312............................            1903             591
Virgin Islands................................  8...............................              12               4
Washington....................................  1215............................            1687             472
West Virginia.................................  455.............................             406             -49
Wisconsin.....................................  1070............................            1062              -8
Wyoming.......................................  93..............................             154              61
----------------------------------------------------------------------------------------------------------------


[[Page 33195]]

    In prioritizing applications to receive grants, VA identifies 
States as having a ``great'', ``significant'', or ``limited'' need for 
additional beds. ``Great'' need is defined as a need for 2,000 or more 
new beds; ``significant'' need as a need for 1,000-1,999 new beds, and 
``limited'' as a need for 999 or fewer new beds. A State that moves 
into a higher priority category as a result of the reallocation of beds 
in this rule will be more likely to receive a future grant than under 
the current allocation of beds. A State that moves into a lower 
priority category will be less likely to receive a future grant than 
under the current allocation of beds. A State that remains within the 
same priority category (even if the allocation of beds to the State 
increases or decreases) will have an equal likelihood of receiving a 
future grant under the new allocation as under the current allocation.
    Our decision to use the same estimated demand for State home beds 
nationwide in 2020, as that which was projected for 2009, would not 
keep States from receiving grants for construction of new State home 
beds. At this time, there are 28,823 recognized State home beds. In 
addition, States are building facilities that when recognized will add 
2,256 beds for a total of 31,079 beds. Therefore, States will soon have 
in use 56 percent of the total estimated number of State home beds 
needed in 2020. Of course, States will also need to replace existing 
State home facilities that become obsolete or otherwise need replacing. 
We thus believe that most States would continue to be able to apply for 
State home grants if that is what the State chooses to do.

Unfunded Mandates

    The Unfunded Mandates Reform Act of 1995 (2 U.S.C 1532) requires 
that agencies prepare an assessment of anticipated costs and benefits 
before issuing any rule that may result in an expenditure by the State, 
local, or Tribal governments, in the aggregate, or by the private 
sector, of $100 million or more (adjusted annually for inflation) in 
any given year. This proposed rule would have no such effect on State, 
local, or Tribal governments, or on the private sector.

Executive Order 12866

    Executive Order 12866 directs agencies to assess all costs and 
benefits of available regulatory alternatives and, when regulation is 
necessary, to select regulatory approaches that maximize net benefits 
(including potential economic, environmental, public health and safety, 
and other advantages; distributive impacts; and equity). The Executive 
Order classifies a ``significant regulatory action,'' requiring review 
by the Office of Management and Budget (OMB) unless OMB waives such 
review, as any regulatory action that is likely to result in a rule 
that may: (1) Have an annual effect on the economy of $100 million or 
more or adversely affect in a material way the economy, a sector of the 
economy, productivity, competition, jobs, the environment, public 
health or safety, or State, local, or Tribal governments or 
communities; (2) create a serious inconsistency or otherwise interfere 
with an action taken or planned by another agency; (3) materially alter 
the budgetary impact of entitlements, grants, user fees, or loan 
programs or the rights and obligations of recipients thereof; or (4) 
raise novel legal or policy issues arising out of legal mandates, the 
President's priorities, or the principles set forth in the Executive 
Order. VA has examined the economic, interagency, budgetary, legal, and 
policy implications of this proposed rule and has concluded that it 
does constitute a significant regulatory action under the Executive 
Order.

Paperwork Reduction Act

    This document contains no provisions constituting a collection of 
information under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-
3521).

Regulatory Flexibility Act

    The Secretary hereby certifies that this proposed rule would not 
have a significant economic impact on a substantial number of small 
entities as they are defined in the Regulatory Flexibility Act, 5 
U.S.C. 601-612. The proposed rule would affect grants to States and 
would not directly affect small entities. Therefore, pursuant to 5 
U.S.C. 605(b), this proposed rule would be exempt from the initial and 
final regulatory flexibility analyses requirements of sections 603 and 
604.

Catalog of Federal Domestic Assistance

    The Catalog of Federal Domestic Assistance program number and title 
for this proposed rule is as follows: 64.005, Grants to States for 
Construction of State Home Facilities.

List of Subjects in 38 CFR Part 59

    Administrative practice and procedure, Alcohol abuse, Alcoholism, 
Claims, Day care, Dental health, Drug abuse, Foreign relations, 
Government contracts, Grant programs--health, Grant programs--veterans, 
Health care, Health facilities, Health professions, Health records, 
Homeless, Medical and dental schools, Medical devices, Medical 
research, Mental health programs, Nursing homes, Reporting and 
recordkeeping requirements, Travel and transportation expenses, and 
Veterans.

    Approved: April 3, 2009.
John R. Gingrich,
Chief of Staff, Department of Veterans Affairs.
    For the reasons stated above, the Department of Veterans Affairs 
proposes to amend 38 CFR part 59 as follows:

PART 59--GRANTS TO STATES FOR CONSTRUCTION OR ACQUISITION OF STATE 
HOMES

    1. The authority citation for part 59 is revised to read as 
follows:

    Authority: 38 U.S.C. 101, 501, 1710, 1742, 8105, 8131-8138.
    2. Amend Sec.  59.2 by revising the definition of ``State'' to read 
as follows:


Sec.  59.2  Definitions.

* * * * *
    State means each of the several States, the District of Columbia, 
the Virgin Islands, the Commonwealth of Puerto Rico, Guam, the 
Commonwealth of the Northern Mariana Islands, and American Samoa.
* * * * *
    3. Amend Sec.  59.40 by revising paragraph (a) to read as follows:


Sec.  59.40  Maximum number of nursing home care and domiciliary care 
beds for veterans by State.

    (a) Except as provided in paragraph (b) of this section, a State 
may not request a grant for a project to construct or acquire a new 
State home facility, to increase the number of beds available at a 
State home facility, or to replace beds at a State home facility if the 
project would increase the total number of State home nursing home and 
domiciliary beds in that State beyond the maximum number designated for 
that State, as shown in the following chart. The provisions of 38 
U.S.C. 8134 require VA to prescribe for each State the number of 
nursing home and domiciliary beds for which grants may be furnished 
(i.e., the unmet need). A State's unmet need for State home nursing 
home and domiciliary beds is the number in the following chart for that 
State minus the sum of the number of nursing home and domiciliary beds 
in operation at State home facilities and the number of State home 
nursing home and domiciliary beds not yet in operation but for which a 
grant has either been requested or awarded under this part.

[[Page 33196]]



------------------------------------------------------------------------
                                                       Maximum number of
                                                           state home
                                                         nursing home &
                        State                           domiciliary beds
                                                         based on 2020
                                                          projections
------------------------------------------------------------------------
Alabama..............................................              1,007
Alaska...............................................                179
American Samoa.......................................                  0
Arizona..............................................              1,520
Arkansas.............................................                653
California...........................................              4,363
Colorado.............................................              1,114
Connecticut..........................................                559
Delaware.............................................                207
District of Columbia.................................                 83
Florida..............................................              4,049
Georgia..............................................              1,975
Guam.................................................                 12
Hawaii...............................................                268
Idaho................................................                394
Illinois.............................................              1,754
Indiana..............................................              1,216
Iowa.................................................                578
Kansas...............................................                518
Kentucky.............................................                818
Louisiana............................................                638
Maine................................................                362
Maryland.............................................              1,102
Massachusetts........................................                944
Michigan.............................................              1,786
Minnesota............................................              1,058
Mississippi..........................................                480
Missouri.............................................              1,257
Montana..............................................                281
Nebraska.............................................                371
Nevada...............................................                649
New Hampshire........................................                361
New Jersey...........................................                992
New Mexico...........................................                417
New York.............................................              2,209
North Carolina.......................................              1,900
North Dakota.........................................                137
Northern Mariana Islands.............................                  1
Ohio.................................................              2,143
Oklahoma.............................................                766
Oregon...............................................                907
Pennsylvania.........................................              2,336
Puerto Rico..........................................                288
Rhode Island.........................................                157
South Carolina.......................................              1,089
South Dakota.........................................                179
Tennessee............................................              1,311
Texas................................................              4,119
Utah.................................................                426
Vermont..............................................                142
Virginia.............................................              1,903
Virgin Islands.......................................                 12
Washington...........................................              1,687
West Virginia........................................                406
Wisconsin............................................              1,062
Wyoming..............................................                154
------------------------------------------------------------------------


    Note to Sec.  59.40(a): The provisions of 38 U.S.C. 8134 require 
that the ``unmet need'' numbers be based on a 10-year projection of 
demand for nursing home and domiciliary care by veterans who at such 
time are 65 years of age or older and who reside in that State. In 
determining the projected demand, VA must take into account travel 
distances for veterans and their families.

* * * * *
[FR Doc. E9-16341 Filed 7-9-09; 8:45 am]
BILLING CODE 8320-01-P