VA Long-Term Care: Oversight of Nursing Home Program Impeded by Data Gaps
Published: 2004-11-10T00:00:00

Fast Facts:

Highlights:
section_title: Why GAO Did This Study
paragraphs: The Department of Veterans Affairs (VA) operates a $2.3 billion nursing home program that provides or pays for veterans' care in three settings: VA nursing homes, community nursing homes, and state veterans' nursing homes. The Veterans Millennium Health Care and Benefits Act (Millennium Act) of 1999 and VA policy require that VA provide nursing home care to veterans with a certain eligibility. Congress has expressed a need for additional data to conduct oversight of VA's nursing home program. Specifically, for all VA nursing home settings in fiscal year 2003, GAO was asked to report on (1) VA spending to provide or pay for nursing home care, (2) VA workload provided or paid for, (3) the percentage of nursing home care that is long and short stay, and (4) the percentage of veterans receiving care required by the Millennium Act or VA policy.
section_title: What GAO Found
paragraphs: In fiscal year 2003, VA spent 73 percent of its nursing home resources on VA nursing homes--almost $1.7 billion of about $2.3 billion--and the remaining 27 percent on community and state veterans' nursing homes. Half of VA's average daily nursing home workload of 33,214 in fiscal year 2003 was for state veterans' nursing homes, even though this setting accounted for 15 percent of VA's overall nursing home expenditures. In large part, this is because VA pays about one-third of the cost of care in state veterans' nursing homes. Community nursing homes and VA nursing homes accounted for 13 and 37 percent of the workload, respectively. About one-third of nursing home care in VA nursing homes in fiscal year 2003 was long-stay care (90 days or more). Long-stay services include those needed by veterans who cannot be cared for at home because of severe, chronic physical or mental impairments such as the inability to independently eat or the need for supervision because of dementia. The other two-thirds was short-stay care (less than 90 days), which includes services such as postacute care needed for recuperation from a stroke. VA lacks similar data for community and state veterans' nursing homes. About one-fourth of veterans who received care in VA nursing homes in fiscal year 2003 were served because the Millennium Act or VA policy requires that VA provide or pay for nursing home care of veterans with a certain eligibility. All other veterans received care at VA's discretion. VA lacks data on comparable eligibility status for community and state veterans' nursing homes even though these settings combined accounted for 63 percent of VA's overall workload. Gaps in data on length of stay and eligibility in these two settings impede program oversight.

section_title: Letter
paragraphs: The Department of Veterans Affairs (VA) operates a $2.3 billion nursing  home program that provides or pays for veterans’ care in VA’s 21 health  care networks. Meeting veterans’ nursing home care needs is a key issue  for VA because it has a large elderly veteran population, many of whom  are in need of such care. In 2003, 38 percent of the veteran population was  over the age of 65 compared to 12 percent for the overall population. VA  provides or pays for veterans’ care in three nursing home settings. VA  operates its own nursing homes and also pays for nursing home care  under contract in non-VA nursing homes—referred to as community  nursing homes. In addition, VA pays part of the cost of care for veterans at  state veterans’ nursing homes and also pays a portion of the construction  costs for some state veterans’ nursing homes. To enhance access to  veterans needing nursing home care across VA’s health care system, an  independent commission recommended in February 2004 that VA develop  a strategic plan for long-term care that includes policies and strategies for  the delivery of nursing home care.
In November 1999, the Congress passed the Veterans Millennium Health  Care and Benefits Act (Millennium Act), which required that through  December 31, 2003, VA provide nursing home care to those veterans with a  service-connected disability rated at 70 percent or greater, those requiring  nursing home care because of a condition related to their military service  who do not have a service-connected disability rating of 70 percent or  greater, and those who were admitted to VA nursing homes on or before  the effective date of the act. Subsequent law extended these provisions  through December 31, 2008. In addition, VA’s policy on nursing home  eligibility required that networks provide nursing home care to veterans  with 60 percent service-connected disability ratings who also meet other  criteria. For all other veterans enrolled in its system, VA’s policy on  nursing home eligibility is to provide nursing home care in VA nursing  homes and contract community nursing homes on a discretionary basis  depending on available resources, with certain patients having higher  priority, including veterans who require postacute care after a hospital  episode. Veterans can also choose to seek care in state veterans’ nursing  homes and if admitted, VA pays a portion of the cost to treat them.
The Committee has expressed a need for additional data in order to  conduct oversight of VA’s nursing home program, especially in light of the  large elderly veteran population. These data needs have focused on the  total amount of resources spent to deliver nursing home care in VA  nursing homes, community nursing homes, and state veterans’ nursing  homes and the amount of nursing home care provided with these  resources. The Committee has also expressed a need for data on the  percentage of veterans in VA’s nursing home program that received long-  and short-stay nursing home care. Long-stay care patients cannot be cared  for at home because of severe, chronic physical or mental limitations. In  addition, the Committee has expressed a need for data on the percentage  of veterans in VA’s nursing home program that are required to be served  based on the Millennium Act or VA policy.
For all nursing home settings in VA’s program in fiscal year 2003, this  report provides information on (1) VA spending to provide or pay for  nursing home care, (2) VA workload provided or paid for, (3) the  percentage of nursing home care that is long and short stay, and (4) the  percentage of veterans receiving care that are required to be served by the  Millennium Act or VA policy. To place this information in context, we  supplement our findings with information for fiscal year 1998.
To perform our work, we reviewed documents and analyzed VA data on  the amount of nursing home expenditures and workload, the percentage of  long- and short-stay care, and the eligibility status of veterans based on the  Millennium Act or VA’s policy on nursing home eligibility. In our  calculation of expenditures, we included direct expenditures by VA to  provide or pay for nursing home care plus costs to administer the program  at the VA medical center. For this review, we measured nursing home  workload as defined by average daily census, which reflects the average  number of veterans receiving nursing home care on any given day during  the course of the year. We used VA data to estimate the number of VA  nursing home long stays, defined as 90 days or more, and short stays,  defined as less than 90 days. To determine the eligibility status of veterans  we used VA data to estimate veterans’ eligibility for VA nursing home care  based on the Millennium Act or VA policy. In doing our work, we tested  the reliability of the data and determined they were adequate for our  purposes. For a complete description of our scope and methodology, see  appendix I. We conducted our review from January 2003 through  November 2004 in accordance with generally accepted government  auditing standards.
subsections: section_title: Background
paragraphs: VA operates its nursing homes in 132 locations, which are located  throughout VA’s 21 health care networks. Almost all of these nursing  homes are attached or in close proximity to a VA medical center.  According to VA policy, VA staff at these facilities determine whether the  veteran has a clinical need for nursing home care based on a  comprehensive interdisciplinary clinical assessment. The interdisciplinary  teams determining clinical need for nursing home care could include  personnel such as the nursing home director, a social worker, nurse,  physical therapist, and gerontologist. The care provided to veterans at a  VA nursing home could include a range of services, including short-term  postacute care needed to recover from a condition such as a stroke to  longer-term care required by veterans who cannot be cared for at home  because of severe, chronic physical or mental limitations.
VA may also refer patients to receive nursing home care under contract  from non-VA nursing homes located in the community—referred to as  community nursing homes. In fiscal year 2003, VA purchased care from  community nursing homes in one of two ways. VA contracted with most  nursing homes through the local VA medical center. In addition, VA also  contracted with some community nursing homes under its Regional  Community Nursing Home initiative, in which nursing home chains in  single or multiple states contract directly with VA headquarters for  services at their nursing homes. In fiscal year 2003, VA contracted with  1,723 nursing homes through its medical centers and with 508 more  nursing homes under its Regional Community Nursing Home initiative.
Veterans may also choose to seek care in state veterans’ nursing homes. In  fiscal year 2003, 109 state veterans’ nursing homes located in 44 states and  Puerto Rico received VA payment to provide care. VA may refer patients to  these nursing homes for care, but does not control the admission process.  Veterans are admitted based on eligibility criteria established by the states.  For state veterans’ nursing homes to participate in VA’s program, however,  VA requires that at least 75 percent of the residents be veterans in most  cases. State veterans’ nursing homes may also provide nursing home care  to certain nonveterans, such as spouses of residents who are veterans. VA  is authorized to pay for about two-thirds of the costs of construction of  state veterans’ nursing homes and pays about a third of the costs per day  to provide care to veterans in these homes. In fiscal year 2003, VA paid  $56.24 per day for veterans in these state veterans’ nursing homes and  awarded $174 million in grants to 16 states for renovations of existing  facilities or construction of new state veterans’ homes.
Veterans can also receive nursing home care financed by sources other  than VA, including Medicaid and Medicare, private health or long-term  care insurance, or self-financed. States design and administer Medicaid  programs that include coverage for long-term nursing home care to assist  with daily activities such as eating and bathing. Medicare primarily covers  acute care health costs and therefore limits its nursing home coverage to  short stays requiring skilled nursing home care following hospitalization.  State Medicaid programs are the principal funders of nursing homes,  besides patients self-financing their care. Private health insurance pays for  about 11 percent of nursing home and home health care expenditures.
section_title: VA Spent Almost Three-Quarters of Its Nursing Home Resources on Care for Veterans in VA Nursing Homes, but Expenditures Varied Widely by Network
paragraphs: VA nursing homes accounted for almost three-quarters of VA’s overall  nursing home expenditures, or about $1.7 billion, in fiscal year 2003. Care  in state veterans’ nursing homes accounted for 15 percent of nursing home  expenditures, or about $352 million. Care in community nursing homes  accounted for the lowest percentage of overall nursing home expenditures  at 12 percent, or about $272 million. Overall, VA spent approximately   $2.3 billion to provide or pay for nursing home care in VA nursing homes,  community nursing homes, and state veterans’ nursing homes in fiscal  year 2003.
In contrast to fiscal year 1998, in fiscal year 2003 the percentage of  expenditures from community nursing homes declined, whereas the  percentage of expenditures for care in VA nursing homes and state  veterans’ nursing homes increased. (See fig. 1.) For example, 70 percent of  nursing home expenditures were accounted for by VA nursing homes in  fiscal year 1998 as compared to 73 percent in 2003. Moreover, the  percentage of community nursing home expenditures was 17 percent in  1998 as compared to 12 percent in 2003. During the same years, VA’s  overall nursing home expenditures increased by about a third, growing  from about $1.7 billion to approximately $2.3 billion.
The percentage of nursing home expenditures for care in each nursing  home setting varied widely by network in fiscal year 2003. (See fig. 2.) All  networks spent the largest percentage of their resources on VA nursing  homes. The percentage of expenditures for VA nursing homes ranged from  a low of 47 percent in Network 19 (Denver) to a high of 88 percent in  Network 6 (Durham). Further, the percentage of overall nursing home  expenditures accounted for by community and state veterans’ nursing  homes also varied widely across the networks. For example, the  percentage of expenditures for community nursing homes ranged from a  low of 2 percent in Network 3 (Bronx) to a high of 28 percent in Network  20 (Portland).
A comparison of how networks’ percentage of expenditures on each  nursing home setting changed in fiscal year 2003 as compared to fiscal  year 1998 showed that networks’ changes were consistent with the VA- wide changes. In fiscal year 2003, the percentage of expenditures for VA  nursing homes increased in 15 of the 21 health care networks as compared  to fiscal year 1998. Similar to the overall trend, the percentage of  expenditures for state veterans’ nursing homes increased in 17 of 21  networks, whereas the percentage of expenditures for community nursing  homes decreased in 17 of 21 networks. The largest shift in the percentage  of expenditures for the three settings occurred in Network 19 (Denver). In  this network, the percentage of expenditures for VA nursing homes  declined from 75 to 47 percent because of a nursing home closure during  this period. For more detailed information on the percent change in  nursing home expenditures for each setting and network in fiscal years  1998 and 2003, see appendix II.
section_title: State Veterans’ Nursing Homes Provided Half of VA’s Overall Nursing Home Workload, but Networks’ Use of Nursing Home Care Setting Varied
paragraphs: State veterans’ nursing homes accounted for half of VA’s overall nursing  home workload—measured by average daily census—in fiscal year 2003,  even though they accounted for only 15 percent of expenditures. In large  part this is because VA pays a per-diem rate for care in state veterans’  nursing homes that, on average, accounts for about one-third of the cost to  provide veterans nursing home care in this setting. The remaining  payments made to state veterans’ nursing homes come from a number of  other sources including Medicaid, Medicare, private health insurance, and  patients self-financing their care. VA nursing homes provided the next  largest percentage of nursing home workload, 37 percent in fiscal year  2003. Community nursing homes provided 13 percent of overall nursing  home workload. Overall, VA provided or paid for 33,214 patients to receive  nursing home care daily in VA nursing homes, community nursing homes,  and state veterans’ nursing homes in fiscal year 2003.
Since fiscal year 1998, VA has increased its use of state veterans’ nursing  homes and decreased the use of VA nursing homes and community  nursing homes. Overall, workload in VA’s nursing home program was  33,214 in fiscal year 2003, about 1 percent below its fiscal year 1998  workload. The percentage of nursing home workload provided in state  veterans’ nursing homes increased from 43 to 50 percent. In contrast, the  percentage of workload provided in VA nursing homes and community  nursing homes declined. (See fig. 3.)
The increase in the percentage of nursing home workload provided in  state veterans’ nursing homes resulted from a number of factors. States,  with the assistance of construction grants from VA, built 17 new state  veterans’ nursing homes, increasing the number of beds available during  this period. The increasing percentage of state veterans’ nursing home  workload also occurred as a result of declines in workload in VA nursing  homes and community nursing homes due to changes in VA’s use of these  settings. In VA nursing homes, VA officials attributed some of the  decreases in nursing home workload to an increased emphasis on  postacute patients with short lengths of stay. Moreover, VA officials told  us that they are providing contract community nursing home care to fewer  veterans and paying for shorter contracts than in the past. The number of  patients VA served in this setting declined from 28,893 to 14,032 during this  period. Network officials also told us that contracts for community  nursing home care are often now 30 days or less and are used primarily to  transition veterans to nursing home care, which is paid for by other payers  such as Medicaid.
Although state veterans’ nursing homes predominate overall, networks  vary widely in the percentage of workload met in different nursing home  settings. For example, networks varied in their use of state veterans’  nursing homes ranging from a low of 22 percent in Network 8 (Bay Pines)  to a high of 71 percent in Network 15 (Kansas City). (See fig. 4.) This  variation is due, in part, to the available bed capacity of state veterans’  nursing homes in these networks. In 2003, Network 15 (Kansas City) had  1,509 state veterans’ nursing home beds compared to 420 beds in Network  8 (Bay Pines). However, wide network variation also existed in the  percentage of networks’ workloads accounted for by VA nursing homes  and community nursing homes.
Changes in networks’ delivery of nursing home care among the three  nursing home settings were consistent with VA-wide changes between  fiscal year 1998 and 2003. The percentage of workload provided in state  veterans’ nursing homes increased in 19 of VA’s 21 health care networks.  Similar to the overall trend, the percentage of workload met in community  nursing homes declined in 17 networks and declined in 13 networks for VA  nursing homes. The largest shift in the percentage of workload for the  three settings occurred in Network 17 (Dallas). In this network, the  percentage of workload for state veterans’ nursing homes increased from 0  to 30 percent because Texas opened up four state veterans’ nursing homes  during this period. For more detailed information on the percent change in  nursing home workload for each setting and network in fiscal years 1998  and 2003, see appendix III.
section_title: About One-Third of VA Nursing Home Care Is Long Stay, but VA Lacks Comparable Information for Other Nursing Home Settings
paragraphs: About one-third of the care VA provided in VA nursing homes was long  stay in fiscal year 2003. The use of long-stay nursing home care (90 days or  more) includes services needed when a person has a physical or mental  disability that cannot be cared for at home. For example, veterans needing  long-stay care may have difficulty performing some activities of daily living  without assistance, such as bathing, dressing, toileting, eating, and moving  from one location to another. They may have mental impairments, such as  Alzheimer’s disease or dementia, that necessitate supervision to avoid  harm to themselves or others or require assistance with tasks such as  taking medications. The remainder, or two-thirds of VA nursing home care,  was short-stay care (less than 90 days) in this setting. VA’s use of short- stay care includes nursing home services such as postacute care required  for recuperation from a stroke or hip replacement. VA officials also told us  that this care could include a number of other services such as the delivery  of complex medical services such as chemotherapy, the treatment of  wounds such as pressure ulcers, and end-of-life care. VA’s use of short- stay care is similar to services provided by Medicare, which provides  short-term coverage, whereas VA’s use of long-stay care is similar to  services provided by Medicaid, which provides long-term coverage for  nursing home care.
Since fiscal year 1998, VA has decreased its use of long-stay care and  increased its use of short-stay nursing home care. Specifically, the  percentage of nursing home care that was long stay has declined from 43  to 34 percent between fiscal years 1998 and 2003. (See fig. 5.) In contrast,  the percentage of short stays provided in this setting increased from 57 to  66 percent during the same period. This shift in the amount of short-stay  care is consistent with VA’s policy on nursing home eligibility that sets a  higher priority on serving veterans who require short-stay postacute care.
Short stay (less than 90 days)
Long stay (90 days or more)
Networks vary widely, however, in the percentage of VA nursing home  care that is long stay. The percentage of long stays in VA nursing homes  ranged from a low of 17 percent in Network 20 (Portland) to a high of   55 percent in Network 7 (Atlanta). (See fig. 6.) Network 20 (Portland)  officials told us that the focus of their VA nursing homes has changed from  long-stay care to short-stay transitional and rehabilitative care and as a  result they are serving more veterans with shorter lengths of stay. By  contrast, Network 7 (Atlanta) officials told us that several of their nursing  homes provide services that are consistent with long-stay nursing home  care such as providing assistance to veterans who have difficulty  performing some activities of daily living such as the inability to  independently eat.
VA lacks information on the amount of long- and short-stay nursing home  care veterans receive in community and state veterans’ nursing homes  preventing it from strategically planning how best to use these nursing  home settings at the national and network levels to enhance access to  nursing home services. VA officials told us that while some of these data  may be available at certain facilities because the facilities collect them for  their own purposes, VA does not require state veterans’ nursing homes and  community nursing homes to provide billing or other information that  identifies individual veterans on which length of stay could be calculated.  VA collects information on the payments made to community nursing  homes and state veterans’ nursing homes, but does not collect the days of  care a veteran receives or other individual information. VA officials told us  that they receive and pay individual claims for some veterans in  community nursing homes, but that in other cases VA pays for care  provided by community nursing homes based on invoices, which  aggregate information on the number of patients being treated by a  nursing home.
VA officials told us that they are in the initial planning stages of  redesigning a payment system to collect information by individual veteran  in community nursing homes, but that the implementation of such a  system could take several years. Once completed, VA officials expect the  new system to collect and report data on the total number of days  individual veterans receive in community nursing homes. VA does not  currently have plans to collect such data for state veterans’ nursing homes,  but is exploring doing so.
section_title: About One-Fourth of Veterans Who Received Care in VA Nursing Homes Are Required to Be Served by the Millennium Act or VA Policy, but VA Lacks Comparable Information for Other Settings
paragraphs: In fiscal year 2003, about 26 percent of veterans who received care in VA  nursing homes are required to be served by the Millennium Act or VA’s  policy on nursing home eligibility. Of these veterans, about 21 percent are  being treated under the Millennium Act because they have a service- connected disability rating of 70 percent or greater. The act also required  that VA continue to treat veterans who had been receiving nursing home  care in VA facilities at the time the law was enacted about 4 percent of  the veterans receiving care in fiscal year 2003 fell into this category.  Further, 1 percent of veterans in VA nursing homes are required to be  served based solely on VA’s policy on nursing home eligibility that  extended required coverage to veterans with a 60 percent service- connected disability rating who also met other criteria.
However, the vast majority of veterans—about 74 percent in fiscal year  2003—received VA nursing home care as a discretionary benefit based on  available budgetary resources. VA’s policy on nursing home eligibility  directs that for these veterans VA nursing homes admit, as a priority,  patients who meet certain clinical and programmatic criteria: patients  requiring nursing home care after a hospital episode, patients who VA  determines cannot be adequately cared for in community nursing homes  or home- and community-based care, and those patients who can be cared  for more efficiently in VA nursing homes.
The percentage of veterans receiving VA nursing home care as required by  the Millennium Act or VA’s policy on nursing home eligibility varied widely  across networks in fiscal year 2003. The percentage of veterans receiving  this care ranged from a low of 20 percent in Network 15 (Kansas City) and  Network 11 (Ann Arbor) to a high of 39 percent in Network 1 (Boston).  (See fig. 7.) However, most networks were grouped closer to the lower  range. Fifteen of VA’s 21 health care networks had percentages of   26 percent or less. According to VA officials, the percentage of veterans  that are required to be treated may be lower in some networks because  networks may choose to pay for these veterans to receive care in  community nursing homes. In contrast, some networks may prefer to treat  these patients in VA nursing homes. For example, officials from Network 3  (Bronx), a network with the second highest percentage at 37 percent, told  us that they prefer to treat these types of veterans in VA nursing homes  because they have sufficient bed capacity.
VA lacks comparable information for community nursing homes or state  veterans’ nursing homes on the percentage of veterans that are required to  be served based on the Millennium Act or VA’s policy on nursing home  eligibility even though these settings combined accounted for 63 percent  of VA’s overall nursing home workload. The lack of such data prevents VA  from strategically planning how best to use these nursing home settings at  the national and network levels to enhance access to nursing home  services. VA officials told us that while some of these data on eligibility  status may be available at certain facilities because the facilities collect  them for their own purposes, VA does not require that this information be  collected and reported to headquarters. VA does not collect information by  individual on all payments made to community nursing homes and state  veterans’ nursing homes. As a result, VA cannot match individual veterans’  data from their payment system with data it currently collects on eligibility  to determine the eligibility status of all veterans receiving contract care in  community nursing homes and state veterans’ nursing homes. VA officials  told us this type of analysis could be done if a new information system for  collecting contract payments is designed and implemented to collect and  report such information.
section_title: Conclusions
paragraphs: Gaps in nursing home data impede VA’s ability to monitor and strategically  plan for the nursing home care VA pays for nationally and at the network  level. The workload in state veterans’ nursing homes and community  nursing homes has grown to 63 percent of VA’s overall nursing home  workload. However, VA does not have data on length of stay and the  eligibility status of veterans receiving care in these settings as it has for VA  nursing homes. As a result, VA cannot strategically plan how best to serve  veterans it is required to serve, including those who have a 70 percent or  greater service-connected disability rating, or other veterans receiving  care on a discretionary basis; nor can VA strategically plan how best to use  the nursing home settings to provide long- and short-stay nursing home  care nationally or in individual networks. Equally important, the lack of  such data and assessments hampers congressional oversight of strategic  options available to VA in its nursing home care planning and its progress  in meeting veterans’ needs.
section_title: Recommendations for Executive Action
paragraphs: To help ensure that VA can provide adequate program monitoring and  planning for nursing home care and to improve the completeness of data  needed for congressional oversight, we recommend that the Secretary of  Veterans Affairs direct the Under Secretary for Health to take two actions:    For community nursing homes and state veterans’ nursing homes, collect  and report data on the number of veterans who have long and short stays,  comparable to data VA currently collects on VA nursing homes.
For community nursing homes and state veterans’ nursing homes, collect  and report data on the number of veterans in these homes that VA is  required to serve based on the requirements of the Millennium Act or VA’s  policy on nursing home eligibility, comparable to data VA currently  collects on VA nursing homes.
section_title: Agency Comments and Our Evaluation
paragraphs: We provided a draft of this report to VA for comment. In commenting on  the draft, VA stated that it concurred in principle with our  recommendations. VA stated that it will continue its efforts to reduce data  gaps in the community nursing home and state veterans home programs,  but VA did not indicate specific plans to collect data on length of stay and  eligibility for its long-term care planning process. Moreover, VA stated that  data other than eligibility and length of stay, such as age and disability, are  most crucial for its long-term care strategic planning and program  oversight. We disagree with VA’s position that eligibility and length-of-stay  data are not considered most crucial and are concerned about VA’s lack of  specificity regarding its intent to utilize these data. While factors such as  age and disability are generally recognized as important in projecting need  for nursing home care, VA needs data on veterans’ eligibility status and  length of stay to determine what portion of the overall veteran need for  nursing home care VA will meet nationally and in individual communities.  Because VA is required to serve veterans that meet the requirements of the  Millennium Act or VA policy, VA needs to project the number of these  veterans seeking nursing home care from VA and determine the number of  other veterans it will also serve on a discretionary basis after meeting this  need. To strategically plan and provide the type of service needed in the  future, VA must also project what proportion of veterans with different  eligibility statuses will need short-stay or long-stay nursing home care. VA  needs to use this information to determine if the nursing home care it  currently pays for in VA nursing homes, contract community nursing  homes, and state veterans’ nursing homes is appropriately located and  provides the type of nursing home care needed by veterans.
VA also noted that it is narrowing information gaps on both veterans’  eligibility status and length of stay for veterans in its community and state  veterans’ nursing home programs by using data extracted from various  sources to estimate these numbers. However, VA did not provide these  data for our review. Given that the combined workload in these settings  accounted for 63 percent of VA’s overall nursing home workload in fiscal  year 2003, we believe that complete information on veterans’ eligibility  status and length of stay for veterans in these settings is crucial for both  strategic planning and program oversight.
VA noted that one of our statements—that about one-fourth of veterans  receiving nursing home care are entitled to such care under the  requirements of the Millennium Act—could be misinterpreted to imply  that some of these “mandatory” veterans are being displaced by veterans  receiving discretionary care. We did not imply this relationship, nor did  our work examine this particular issue.
We are sending copies of this report to the Secretary of Veterans Affairs  and appropriate congressional committees. The report is available at no  charge on GAO’s Web site at http://www.gao.gov. We will also make copies  available to others on request.
If you or your staff have any questions about this report, please call me at  (202) 512-7101. Another contact and key contributors are listed in  appendix V.
section_title: Appendix I: Objectives, Scope, and Methodology
paragraphs: We reviewed the Department of Veterans Affairs’ (VA) nursing home  program for fiscal year 2003 for VA nursing homes, community nursing  homes, and state veterans’ nursing homes to determine (1) VA spending to  provide or pay for nursing home care, (2) VA workload provided or paid  for, (3) the percentage of nursing home care that is long and short stay,  and (4) the percentage of veterans receiving care that are required to be  served by the Millennium Act or VA policy. To place this information in  context, you asked us to supplement our findings with information for  fiscal year 1998.
To address the first two objectives, we obtained data on nursing home  workload and expenditures at the network level for fiscal years 1998 and  2003 from several VA headquarters offices. VA’s Geriatrics and Extended  Care Strategic Healthcare Group provided us workload data for VA  nursing homes and community nursing homes, as reported in VA’s  Automated Management Information System. This group also gave us  workload data from monthly reports completed by state veterans’ nursing  homes that were maintained at the VA medical centers. These data are  used by the Geriatrics and Extended Care office to provide per diem  grants to state veterans’ homes. The Office of the Chief Financial Officer  for the Veterans Health Administration (VHA) provided us expenditure  data from VA’s Cost Distribution Report for the nursing home care  provided or paid for by VA.
To do our analysis, we used average daily census as a measure of  workload. Average daily census is the total number of days of nursing  home care provided in a year divided by the number of days in the year.  For VA nursing home expenditures, we included the direct costs used to  provide nursing home care plus other facility costs associated with  operating the nursing home. VA nursing home expenditures excluded  depreciation as well as VA headquarters and network administrative costs.  To calculate community nursing home expenditures, we included all  contract payments made to community nursing homes plus additional  facility expenditures required to directly support the program at the local  VA medical center. To calculate state veterans’ home expenditures, we  included per diem payments made to state veterans’ nursing homes plus  additional facility expenditures required to directly support the program at  local VA medical centers. Expenditures for state veterans’ homes did not  include construction grants.
To determine the percentage of long and short stays in VA nursing homes  in fiscal years 1998 and 2003, we obtained data on length of stay from  VHA’s Extended Care Patient Treatment Files. The Patient Treatment Files  include nursing home discharges for veterans who were discharged from a  VA nursing home during a fiscal year, and current resident files for  veterans who were not discharged by the end of a fiscal year. Using length  of nursing home stay, we classified stays of 90 days or more as long stays  and stays of less than 90 days as short stays. Length of stay is calculated as  the number of days in a nursing home between the admission and  discharge days and was given a minimum value of 1. The number of days  absent from the nursing home, such as for a hospital stay, was subtracted  from the length of stay. Because current residents were not discharged  within the fiscal year, we calculated their lengths of stay by looking ahead  into the next fiscal year. That is, we matched current residents with  discharges in the next fiscal year to determine whether their stays were  short or long. A current resident who was admitted on the last day of the  fiscal year, for example, but was discharged after 90 days into the next  fiscal year, was classified as having a long stay. If the same resident was  discharged within 90 days of the next fiscal year, then the stay was  classified as short. We classified nursing home stays as long for current  residents who were not discharged in the next fiscal year. Our analysis for  long- and short-stay care was based on nursing home stays rather than  individual veterans because some veterans had multiple nursing home  stays.
To determine the percentage of veterans in VA nursing homes receiving  care that are required to be served by the Millennium Act or VA policy, we  obtained individual data on eligibility for veterans enrolled in VA’s health  care system. VHA’s Office of Policy and Planning provided us these data in  an enrollment file for fiscal year 2003. We merged these data with the  discharge and current resident files from VHA’s Extended Care Patient  Treatment Files in order to calculate the percentage of veterans receiving  nursing home care that are required to be served in fiscal year 2003. Our  analyses on eligibility are based on individual veterans rather than nursing  home stays; because some veterans had multiple nursing home stays in a  given year, we retained veterans’ first nursing home stay and eliminated  other stays in that year. We used a variable from VA’s enrollment file that  measures service-connected disability rating. In addition, we used  variables from the file that measure whether the veteran is unemployable  and whether the veteran is considered permanent and total disabled,  based on disabilities not related to military service.
We included the following categories of veterans in our calculation to  determine the percentage of veterans receiving nursing home care  required to be served by the Millennium Act or VA’s policy on nursing  home eligibility: (1) veterans who had a service-connected disability rating  of 70 percent or more; (2) veterans who were admitted to a VA nursing  home on or before November 30, 1999; and (3) veterans who had a service- connected disability rating of 60 percent and who were also unemployable  or permanent and total disabled. We did not include in our estimate  veterans VA is required to serve who need nursing home care because of a  service-connected disability, but who do not have a service-connected  disability rating of 70 percent or more. VA did not have data on these  veterans, but a VA official estimated that this group is very small based on  conversations with facility staff.
To supplement our knowledge of the type of nursing home care provided  in VA networks, we visited two networks and five nursing homes. In  Network 5 (Baltimore) we visited Washington, D.C.; Martinsburg, West  Virginia; and Baltimore, Maryland. In Network 23 (Minneapolis) we visited  St. Cloud, Minnesota; and Minneapolis, Minnesota. We selected these two  networks because they were in different geographic regions and had  variation in the types of care offered in their facilities. Within each  network, we chose one nursing home that provided more long-stay nursing  home care and another that provided more short-stay care.
We assessed the reliability of workload and expenditure data in VA’s  nursing home program, VHA’s enrollment data file, and VHA’s Extended  Care Patient Treatment Files in several ways. First, we performed tests of  data elements. For example, we examined the range of values for length of  stay to determine whether these data were complete and reasonable.  Second, we reviewed existing information about the data elements. For  example, we obtained and reviewed information from VHA on data  elements we used from VHA’s Extended Care Patient Treatment Files.  Third, we interviewed agency officials knowledgeable about the data in  our analyses and knowledgeable about VA’s nursing home program. For  example, we sent network-specific nursing home workload and  expenditure data provided to us by VA headquarters to each of VA’s 21  health care networks through electronic mail in December 2003. Network  officials reported whether these data were accurate and indicated where  they found discrepancies. Through discussions with VA headquarters and  network officials we resolved the discrepancies. We determined that the  data we used in our analyses were sufficiently reliable for the purposes of  this report.
We performed our review from January 2003 to November 2004 in  accordance with generally accepted government auditing standards.
section_title: Appendix II: Changes in Percentage of Nursing Home Expenditures by Setting and Network, Fiscal Years 1998 and 2003
paragraphs: Increase was less than 1 percent.
Decrease was less than 1 percent.
subsections: section_title: Fiscal year 2003 percentage of total
section_title: Appendix III: Changes in Percentage of Nursing Home Workload by Setting and Network, Fiscal Years 1998 and 2003
paragraphs: Decrease was less than 1 percent.
Increase was less than 1 percent.
subsections: section_title: Fiscal year 2003 percentage of total
section_title: Appendix IV: Comments from the Department of Veterans Affairs
section_title: Appendix V: GAO Contact and Staff Acknowledgments
subsections: section_title: GAO Contact
section_title: Acknowledgments
paragraphs: In addition to the contact named above, Cheryl A. Brand, Pamela A.  Dooley, and Thomas A. Walke made key contributions to this report.
section_title: Related GAO Products
paragraphs: VA Long-Term Care: More Accurate Measure of Home-Based Primary  Care Workload Is Needed. GAO-04-913. Washington, D.C.: September 8,  2004.
VA Long-Term Care: Changes in Service Delivery Raise Important  Questions. GAO-04-425T. Washington, D.C.: January 28, 2004.
VA Long-Term Care: Veterans’ Access to Noninstitutional Care Is  Limited by Service Gaps and Facility Restrictions. GAO-03-815T.  Washington, D.C.: May 22, 2003.
VA Long-Term Care: Service Gaps and Facility Restrictions Limit  Veterans’ Access to Noninstitutional Care. GAO-03-487. Washington, D.C.:  May 9, 2003.
Department of Veterans Affairs: Key Management Challenges in Health  and Disability Programs. GAO-03-756T. Washington, D.C.: May 8, 2003.
VA Long-Term Care: The Availability of Noninstitutional Services Is  Uneven. GAO-02-652T. Washington, D.C.: April 25, 2002.
VA Long-Term Care: Implementation of Certain Millennium Act  Provisions Is Incomplete, and Availability of Noninstitutional Services  Is Uneven. GAO-02-510R. Washington, D.C.: March 29, 2002.
VA Long-Term Care: Oversight of Community Nursing Homes Needs  Strengthening. GAO-01-768. Washington, D.C.: July 27, 2001.