fewer than three Veterans Integrated Service 
Networks selected under subparagraph (A) 
serve areas with the highest percentage of vet-
erans who are currently receiving nursing home 
care through the Department and would be eli-
gible to receive assisted living services under the 
pilot program. 
(2) FACILITIES.— 
(A) IN GENERAL.—Within each Veterans 
Integrated Service Network selected under 
paragraph (1), the Secretary shall select facili-
ties at which to carry out the pilot program 
under subsection (a)(1). 
(B) SELECTION
CRITERIA.—In selecting 
facilities under subparagraph (A), the Secretary 
shall ensure that— 
(i) the locations of such facilities are 
in geographically diverse areas; 
(ii) not fewer than two such facilities 
serve veterans in rural or highly rural 
areas (as determined through the use of 
the Rural-Urban Commuting Areas coding 
system of the Department of Agriculture); 
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(iii) not fewer than one such facility is 
located in each Veterans Integrated Service 
Network selected under paragraph (1); and 
(iv) not fewer than two such facilities 
are State homes. 
(c) PROVISION OF ASSISTED LIVING SERVICES.— 
(1) AGREEMENTS.—In carrying out the pilot 
program under subsection (a)(1), the Secretary may 
enter into agreements for the provision of assisted 
living services on behalf of eligible veterans with— 
(A) a provider participating under a State 
plan or waiver under title XIX of the Social Se-
curity Act (42 U.S.C. 1396 et seq.); or 
(B) a State home recognized and certified 
under subpart B of part 51 of title 38, Code of 
Federal Regulations, or successor regulations. 
(2) STANDARDS.—The Secretary may not place, 
transfer, or admit a veteran to any facility for as-
sisted living services under the pilot program under 
subsection (a)(1) unless the Secretary determines 
that— 
(A) the facility meets the standards for 
community residential care established under 
sections 17.61 through 17.72 of title 38, Code 
of Federal Regulations, or successor regula-
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tions, and any additional standards of care as 
the Secretary may specify; or 
(B) in the case of a facility that is a State 
home, the State home meets the standards for 
care established under subpart E of part 51 of 
title 38, Code of Federal Regulations, or suc-
cessor regulations, and any additional standards 
of care as the Secretary may specify. 
(3) INSPECTION.—The Secretary shall inspect 
facilities at which veterans are placed under the pilot 
program under subsection (a)(1)— 
(A) with respect to a facility that is a 
State home, not less frequently than annually 
and in the same manner as the Secretary con-
ducts inspection of State homes under section 
1742 of title 38, United States Code; and 
(B) with respect to any other facility, not 
less frequently than annually and in the same 
manner as the Secretary conducts inspection of 
facilities under section 1730 of such title. 
(4) PAYMENT TO CERTAIN FACILITIES.— 
(A) STATE HOMES.—In the case of a facil-
ity participating in the pilot program under 
subsection (a)(1) that is a State home, the Sec-
retary shall pay to the State home a per diem 
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for each veteran participating in the pilot pro-
gram at the State home that is— 
(i) greater than the per diem for 
domiciliary care at the State home, if ap-
plicable; and 
(ii) less than the per diem for nursing 
home care at the State home. 
(B) COMMUNITY ASSISTED LIVING FACILI-
TIES.—In the case of a facility participating in 
the pilot program that is a community assisted 
living facility, the Secretary shall pay to the fa-
cility an amount that is less than the average 
rate paid by the Department for placement in 
a community nursing home in the same Vet-
erans Integrated Service Network. 
(d) CONTINUITY OF CARE.—Upon the termination of 
the pilot program under subsection (a)(1), the Secretary 
shall— 
(1) provide to all veterans participating in the 
pilot program at the time of such termination the 
option to continue to receive assisted living services 
at the site they were assigned to under the pilot pro-
gram, at the expense of the Department; and 
(2) for such veterans who do not opt to con-
tinue to receive such services— 
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(A) ensure such veterans do not experience 
lapses in care; and 
(B) provide such veterans with information 
on, and enroll participants in, other long-term 
care options based on their preferences and best 
medical interest. 
(e) ANNUAL REPORT.— 
(1) IN
GENERAL.—Not later than one year 
after the initiation of the pilot program under sub-
section (a)(1), and annually thereafter for each year 
in which the pilot program is carried out, the Sec-
retary shall submit to the Committees on Veterans’ 
Affairs of the House of Representatives and the Sen-
ate a report on the pilot program, including— 
(A) an identification of Veterans Inte-
grated Services Networks and facilities of the 
Department participating in the pilot program 
and assisted living facilities and State homes at 
which veterans are placed under the pilot pro-
gram; 
(B) the number of participants in the pilot 
program, disaggregated by facility; 
(C) general demographic information of 
participants in the pilot program, including av-
erage age, gender, and race or ethnicity; 
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(D) disability status of participants in the 
pilot program; 
(E) an identification of any barriers or 
challenges to enrolling veterans in the pilot pro-
gram, conducting oversight of the pilot pro-
gram, or any other barriers or challenges; 
(F) the cost of care at each assisted living 
facility and State home participating in the 
pilot program, including an analysis of any cost 
savings by the Department when comparing 
that cost to the cost of nursing home care; 
(G) aggregated feedback from participants 
in the pilot program; and 
(H) such other matters the Secretary con-
siders appropriate. 
(2) FINAL REPORT.—As part of the final report 
submitted under paragraph (1), the Secretary shall 
include recommendations on whether the model 
studied in the pilot program should be continued or 
adopted throughout the Department. 
(f) REPORT BY INSPECTOR GENERAL.— 
(1) REPORT.—Not later than two years after 
the initiation of the pilot program under subsection 
(a)(1), the Inspector General of the Department of 
Veterans Affairs shall submit to the Secretary, the 
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Committees on Veterans’ Affairs of the House of 
Representatives and the Senate a report on the pilot 
program. 
(2) ELEMENTS.—The report under paragraph 
(1) shall include an assessment of— 
(A) the quality of care provided to veterans 
at facilities participating in the pilot program; 
(B) the oversight of such facilities, as con-
ducted by the Department, the Centers for 
Medicare & Medicaid Services, State agencies, 
and other relevant entities; and 
(C) such other matters as the Inspector 
General considers appropriate. 
(3) FOLLOW-UP.—Not later than 90 days after 
the submission of the report under paragraph (1), 
the Secretary shall submit to the Committees on 
Veterans’ Affairs of the House of Representatives 
and the Senate a plan to address the deficiencies 
identified in the report, if any. 
(g) DEFINITIONS.—In this section: 
(1) The term ‘‘assisted living services’’ means— 
(A) services of a facility in providing room, 
board, and personal care for and supervision of 
residents for their health, safety, and welfare; 
and 
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(B) a level of care more intensive than 
domiciliary care and less intensive than nursing 
home care. 
(2) The term ‘‘eligible veteran’’ means a vet-
eran who is eligible for assisted living services, as 
determined by the Secretary, and— 
(A) is already receiving nursing home level 
care paid for by the Department; 
(B) is eligible to receive nursing home level 
care paid for by the Department; or 
(C) exceeds the requirements for domi-
ciliary care paid for by the Department but 
does not meet the requirements for nursing 
home level care paid for by the Department. 
(3) The term ‘‘State home’’ has the meaning 
given that term in section 101(19) of title 38, 
United States Code. 
Æ 
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