VA Health Care: Spending for Mental Health Strategic Plan Initiatives Was Substantially Less Than Planned
Published: 2006-11-21T00:00:00

Fast Facts:

Highlights:
section_title: Why GAO Did This Study
paragraphs: The Department of Veterans Affairs (VA) provides mental health services to veterans with conditions such as post-traumatic stress disorder (PTSD) and substance abuse disorders. To address gaps in services needed by veterans, VA approved a mental health strategic plan in 2004. VA planned to increase its fiscal year 2005 allocations for plan initiatives by $100 million above fiscal year 2004 levels and its fiscal year 2006 allocations for plan initiatives by $200 million above fiscal year 2004 levels. GAO was asked to provide information on VA's allocation and use of funding for mental health strategic plan initiatives in fiscal years 2005 and 2006, and to examine the adequacy of how VA tracked spending and the extent of spending for plan initiatives. GAO reviewed VA reports and documents on plan initiatives and conducted interviews with VA officials at headquarters, 4 of 21 health care networks, and seven medical centers. VA networks provide oversight of medical center operations and most medical center resources.
section_title: What GAO Found
paragraphs: In fiscal year 2005, VA headquarters allocated about $88 million of the $100 million above fiscal year 2004 levels that VA officials intended for mental health strategic plan initiatives. VA allocated about $53 million directly to medical centers and certain offices based on proposals submitted for funding and other approaches targeted to specific initiatives. VA solicited proposals from networks for initiatives to be carried out at medical centers through requests for proposals (RFP). In addition, VA headquarters officials said that VA allocated $35 million for plan initiatives through VA's general resource allocation system to its 21 health care networks on a retrospective basis, several months after resources had been provided to the networks though the general resource allocation system. VA did not notify network and medical center officials that these funds were to be used for plan initiatives. Network and medical center officials interviewed told GAO that they were not aware these allocations had been made. As a result, it is likely that some of these funds were not used for plan initiatives. VA did not allocate the approximately $12 million remaining of the $100 million for fiscal year 2005 because, according to VA officials, there was not enough time during the fiscal year to do so. Medical center officials said they used funds allocated for plan initiatives for new services and for enhancement of existing services. For example, two medical centers increased the number of mental health providers at community-based outpatient clinics. However, some medical center officials reported they did not use all funds allocated by the end of the fiscal year, due in part to the time it took to hire staff. In fiscal year 2006, VA headquarters allocated about $158 million of the $200 million above fiscal year 2004 levels intended for mental health strategic plan initiatives directly to medical centers and certain offices. VA allocated about $92 million of these funds to support new initiatives, using RFPs and other targeted funding approaches. VA also allocated about $66 million to support recurring costs of continuing initiatives from the prior fiscal year. About $42 million of the $200 million for fiscal year 2006 was not allocated. Officials from seven medical centers GAO interviewed reported they had used funds for plan initiatives, such as the creation of a new case management program. Officials at some medical centers reported they did not anticipate problems using all of the funds allocated within the fiscal year; however, officials at other medical centers were less certain they would be able to do so. VA tracking of spending for plan initiatives was inadequate. In fiscal year 2005, VA did not track such spending. In fiscal year 2006, VA tracked aspects of plan initiatives but not dollars spent. However, available information indicates that VA spending for plan initiatives was substantially less than planned. In fiscal year 2006, VA medical centers returned to headquarters about $46 million of about $158 million allocated for plan initiatives because they could not spend the funds that year. However, VA cannot determine to what extent the approximately $112 million remaining was spent on plan initiatives because it did not track specifically how these funds were spent.

section_title: Letter
paragraphs: The Department of Veterans Affairs (VA) provides a range of inpatient and  outpatient mental health services to veterans with conditions such as  depression, post-traumatic stress disorder (PTSD), and substance abuse  disorders. In November 2004, the Secretary of VA approved a mental  health strategic plan that identified additional services that VA planned to  add to the baseline of mental health services that it already offered to meet  veterans’ mental health needs. This mental health strategic plan was  based on previous VA efforts that identified gaps in the availability and  adequacy of VA mental health services, including services for the  treatment of substance abuse disorders. VA’s mental health strategic plan  was intended to help VA’s leadership identify the actions and resources  needed to begin eliminating the gaps between mental health services VA  provided at the time of the plan’s formulation and those additional  services VA anticipated that would be required to meet future needs.
VA indicated at a 2005 congressional hearing that it would provide   $100 million above fiscal year 2004 levels for mental health strategic plan  initiatives in fiscal year 2005 from available resources. In addition, in a  2005 executive decision memo, VA indicated its intent to increase its fiscal  year 2006 funding levels to $200 million above fiscal year 2004 levels for  mental health strategic plan initiatives. This $200 million in funds for fiscal  year 2006 was to be composed of $100 million for a continuation of fiscal  year 2005 initiatives plus an additional $100 million included in the  President’s budget request for fiscal year 2006, according to the executive  decision memo. These additional funds represented only a portion of the  overall funds available to support VA mental health services in those   2 fiscal years. VA’s appropriation for fiscal year 2006, for example,  included more than $31.5 billion for its medical programs, of which VA  expected to spend more than $2 billion on mental health services. VA  headquarters allocates most of these resources to VA’s 21 regional health  care networks through a general resource allocation system and the  networks in turn allocate resources to their medical centers.
VA officials have stated that funds for mental health strategic plan  initiatives are to be used to address priorities such as the expansion of  PTSD services, postdeployment mental health services for veterans  returning from combat in Iraq and Afghanistan and other geographic  areas—Operation Iraqi Freedom (OIF) and Operation Enduring Freedom  (OEF), respectively, and the expansion of programs for the treatment of  substance abuse disorders. In recent years, VA’s mental health services  and budget have come under increased scrutiny due to the potential for  increased demand for mental health services from veterans returning from  combat in Iraq and Afghanistan. In particular, concerns have been  expressed by members of Congress and others regarding the adequacy of  resources that VA is devoting to provide mental health care for these  veterans while also continuing to provide services for veterans who are  currently receiving mental health care.
You requested that we provide information on VA’s allocation and  spending for mental health strategic plan initiatives in fiscal years 2005  and 2006, and the extent to which VA tracks the use of funding for plan  initiatives. In this report, we provide information on (1) how much of the  $100 million for mental health strategic plan initiatives in fiscal year 2005  was allocated and how those funds were used by selected medical centers,  (2) how much of the $200 million for mental health strategic plan  initiatives in fiscal year 2006 was allocated and how those funds were used  by selected medical centers, and (3) the adequacy of how VA tracked  funds spent for mental health strategic plan initiatives in fiscal years 2005  and 2006 and the extent to which allocated funds were spent for these  initiatives.
To provide information on how much of the $100 million for fiscal year  2005 and $200 million for fiscal year 2006 for mental health strategic plan  initiatives was allocated to networks, medical centers, and certain offices,  we reviewed the plan itself as well as reports and other documents related  to the development, implementation, and funding of the mental health  strategic plan. We also conducted interviews with VA headquarters  officials with responsibilities related to mental health services, budgeting,  and the allocation of financial resources. We took steps to ensure that the  data VA provided to us on the funding allocated in fiscal years 2005 and  2006 were sufficiently reliable for our purposes. We reviewed the data for  internal consistency and compared the data to other VA information as  well as information we obtained through interviews with VA officials. We  did not independently verify the accuracy of the data. Nor did we  independently determine the extent to which legislation regarding VA  health care expressly requires spending or authorizes various types of  mental health services but relied on VA’s determination regarding these  services. To describe how funds were used by selected medical centers, in  May and June 2006, we conducted site visits to 2 of VA’s 21 health care  networks and three medical centers located in those networks, and we  also conducted phone interviews with officials in 2 other networks and  four medical centers located in those networks. We selected these 4  networks because VA had identified them as having gaps in substance  abuse and/or mental health services prior to the implementation of the  mental health strategic plan, and because they received varying levels of  funding—from relatively high to relatively low—in fiscal year 2005 for  mental health strategic plan initiatives. We interviewed clinical and  administrative officials at these networks and medical centers and at three  community-based outpatient clinics (CBOC) associated with these  medical centers and at five Vet Centers. We conducted these interviews in  May and June 2006. The findings from our site visits and phone interviews  with network and medical center officials cannot be generalized to other  medical centers or networks. For a list of VA health care networks and  medical centers included in our review, see appendix I. For a list of  selected VA mental health services discussed in this report, see appendix  II. This work expands upon the preliminary findings that we reported in  September 2006.
To discuss how VA tracked funds spent for mental health strategic plan  initiatives in fiscal years 2005 and 2006 and the extent to which these  funds were spent for mental health strategic plan initiatives, we reviewed  documents related to VA’s tracking efforts and interviewed VA  headquarters officials responsible for those efforts. We also requested  from VA headquarters information on the amount of funds returned by  medical centers to headquarters when medical centers were unable to  spend all the funds in a fiscal year. In addition, we requested information  from VA headquarters on the amount of funds medical centers spent on  plan initiatives. To gain further insights and perspectives on veterans’  mental health services generally, we reviewed our previous work on VA  health care, including those related to mental health and strategic planning  (see Related GAO Products at the end of this report), and interviewed  officials from selected veterans’ service organizations and professional  and advocacy organizations. We focused on the allocation and use of  funds related to mental health strategic plan initiatives, and did not  evaluate the appropriateness of the mental health strategic plan, VA’s  efforts to implement the initiatives outlined in the plan, or VA’s allocation  and use of funding for mental health services generally. We performed our  work from January 2006 through November 2006 in accordance with  generally accepted government auditing standards.
subsections: section_title: Background
paragraphs: VA operates a national health care system that provides health care  services to over 5 million patients annually. As part of that system, VA  provides mental health services to veterans in inpatient and outpatient  settings in a variety of VA health care facilities, including medical centers,  CBOCs, and Vet Centers. Veterans receiving these services include  homeless veterans, veterans with serious mental illness, and veterans  returning from combat who are dealing with postdeployment readjustment  issues. Mental health services are provided for a range of conditions such  as depression, PTSD, and substance abuse disorders.
subsections: section_title: Organizational Structure and Funding of VA’s Mental Health Services
paragraphs: VA’s Under Secretary for Health heads VA health care programs and is  responsible for oversight of operations in VA’s 21 health care networks,  which are structured to manage and allocate resources to more than 150  VA medical centers. Mental health services are provided on an inpatient  and outpatient basis in medical centers and may also be provided on an  outpatient basis in CBOCs, which are associated with medical centers.  Within VA, the lead mental health expert is the Deputy Chief Patient Care  Services Officer for Mental Health. This position does not have direct  authority for operations, but instead serves as an advisor to VA networks  and medical centers on mental health services. In addition, the official in  this position is responsible for oversight of the Office of Mental Health  Services (OMHS) located at VA headquarters. OMHS includes various  clinical experts who provide consultation on mental health services,  including PTSD and substance abuse, to VA program officials in the  networks and medical centers.
VA headquarters allocates most of its medical program services budget  each year through a general resource allocation system to its 21 health  care networks. This system, the Veterans Equitable Resource Allocation  (VERA) system, uses a case-mix formula to allocate funding to the  networks, which in turn allocate funding to their medical centers.  Although the VERA system is used to allocate funds, it does not designate  funds for specific purposes or prescribe how those funds are to be used.  Medical centers also receive funding for specific purposes, such as  prosthetics, from VA headquarters that is not allocated through the VERA  system. In addition, VA medical center resources include collections from  insurance reimbursements, copayments, and deductibles for the care of  some veterans.
section_title: VA’s Mental Health Strategic Plan
paragraphs: In April 2002, President Bush established the President’s New Freedom  Commission on Mental Health and directed the Commission to identify  policies that could be implemented by federal, state, and local  governments to improve the delivery of mental health care across the  country. In July 2003, the Commission released its final report and  recommendations for improving the American mental health care system.  After release of the report, VA’s Under Secretary for Health formed a work  group of mental health and health care professionals charged with  reviewing the Commission’s recommendations to determine if those  recommendations were relevant to VA’s mental health program.
Following that effort, in July 2004, VA completed its mental health  strategic plan for improving the delivery of mental health services within  its health care system. This plan was formally approved by the Secretary  of VA in November 2004. The mental health strategic plan contained  recommended initiatives for improving VA mental health services by  addressing a range of issues, including, for example, improving awareness  about mental illness and improving access to mental health services.  According to VA officials, the mental health strategic plan was designed to  address gaps in mental health services provided to veterans across the  country. Some of the service gaps identified by the VA were in treating  veterans with serious mental illness, female veterans, and veterans  returning from combat in Iraq and Afghanistan. The implementation of the  mental health strategic plan sought to ensure, for example, that mental  health services are provided in community-based outpatient settings; that  veterans have consistent access to mental health services across the  country; and that acute inpatient mental health services are coordinated  with other inpatient services provided to veterans.
Within VA, OMHS is responsible for coordinating with the networks and  medical centers on the overall implementation of the mental health  strategic plan. This includes formulating strategies for allocating funds  committed for the plan’s implementation. Such strategies include, for  example, the use of RFPs solicited from networks for specific initiatives to  be carried out at their individual medical centers. In addition to making  these funding decisions, OMHS is also responsible for tracking the use of  funds allocated for implementing the mental health strategic plan.
While VA initially attempted to develop an estimate of the cost to fully  implement the mental health strategic plan, VA has since decided that a  comprehensive cost estimate is inappropriate. According to VA, a full- implementation cost estimate is inappropriate because the plan is a “living  document” that will continue to change over time as it is implemented, and  thus, the costs will change as well. VA, working with an actuarial firm that  used certain assumptions provided by VA, developed both a long-term and  a shorter-term “unofficial” estimate of implementation costs for the  initiatives included in the plan because VA wished to have a “rough  estimate” of what might be entailed in providing all services that might be  needed if capacity were not a constraint, according to VA officials. VA and  the actuary it used concluded, however, that the methodology used to  develop these estimates was problematic. For example, the estimates used  incorrect projections for utilization of mental health services, in part,  because VA’s population and mental health services are different from  those in the private sector. VA officials said that more current and  accurate data are becoming available for use in projecting the number of  OIF and OEF veterans who would be entering the system and need such  services, and that such data and improvements in projecting demand were  used in development of the President’s budget request for fiscal years 2006  and 2007.
section_title: VA Allocated about $88 Million of the $100 Million Planned for Mental Health Strategic Plan Initiatives in Fiscal Year 2005, but Officials Reported That Not All Allocated Funds Were Used for Plan Initiatives
paragraphs: VA headquarters allocated about $88 million of the $100 million that VA  officials said would be allocated for VA mental health strategic plan  initiatives in fiscal year 2005 by using several approaches. About   $53 million was allocated directly to medical centers and certain offices  and $35 million was allocated through VA’s general resource allocation  system to its health care networks, according to VA officials. The  approximately $12 million remaining of the $100 million was not allocated  by any approach, headquarters officials said, because there was not  enough time during the fiscal year to allocate the funds. Officials we  interviewed at seven medical centers in four networks reported using  allocated funds to provide new mental health services and to provide more  of existing services. However, some medical center officials reported that  they did not use all allocated funds for plan initiatives by the end of fiscal  year, due in part to the length of time it took to hire new staff.
subsections: section_title: VA Allocated Approximately $53 Million Directly to Medical Centers and Certain Offices
paragraphs: VA headquarters allocated about $53 million directly to medical centers  and certain offices based on proposals submitted for funding and other  approaches targeted to specific initiatives related to the mental health  strategic plan in fiscal year 2005. (See table 1.) VA headquarters developed  RFPs and solicited submissions from networks for specific initiatives to be  carried out at their individual medical centers through these RFPs. VA  allocated resources through this and other targeted approaches to support  a range of mental health services, based, in part, on the priorities of VA  leadership and legislation for programs related to PTSD, substance abuse,  and other mental health areas, according to VA headquarters officials. VA  headquarters officials told us that the Secretary of VA had identified  several areas of the mental health strategic plan that were to be priorities  for implementation, including those related to substance abuse, PTSD,  services for veterans of OIF/OEF, mental health in CBOCs, and  homelessness. Nearly $20 million of the approximately $53 million  allocated by using RFPs and other targeted approaches was for mental  health services related to legislation that expressly required spending or  authorized such services, according to VA officials. In addition, nearly   $33 million was allocated for mental health services not directly related to  such legislation.
Most of the approximately $53 million allocated—about $48 million—went  to VA medical centers. PTSD services and OEF/OIF veterans’ mental  health care received combined allocations of about $18 million. In  addition, combined allocations for Compensated Work Therapy (CWT)  totaled nearly $10 million. Other initiatives receiving funding included  substance abuse services, domiciliary expansion, and psychosocial  rehabilitation for veterans with serious mental illness. In addition, VA  allocated $4 million that was initially planned for CWT programs to VA’s  Office of Geriatrics and Extended Care to support development of a new  nursing home care model. This shift occurred toward the end of the fiscal  year, when it appeared that not all mental health strategic plan funding  would be allocated that year. VA officials noted that the nursing home  model was aligned with initiatives in the mental health strategic plan  related to the needs of veterans in long-term care settings. The remaining  funds—$600,000—were allocated to VA’s Employee Education System to  develop educational programs.
VA headquarters officials issued five RFPs from October 2004 to January  2005 that described the specific types of services for which mental health  strategic plan funding was available. The RFPs related to PTSD, veterans  of OIF and OEF, substance abuse, and psychosocial rehabilitation services  were issued in October 2004; the domiciliary RFP was issued in January  2005. All of the RFPs noted that funding would be provided to address  unmet needs or gaps in services. Review panels headed by mental health  experts within VA reviewed the proposals submitted by networks, ranked  them, and provided their rankings to VA’s leadership who made the  allocation decisions. VA then allocated funding directly to medical  centers for the mental health strategic plan initiatives beginning in  February 2005 and continuing throughout fiscal year 2005.
In addition to RFPs, VA also used other approaches targeted to specific  initiatives based on identified needs. For example, VA headquarters  officials used a targeted approach to allocate funding to medical centers to  expand mental health services at CBOCs that had fewer mental health  visits than a standard that VA identified for this purpose. In addition, VA  headquarters allocated funds to support the creation of CWT-supported  employment mentor sites in each network. The medical centers selected at  those sites were expected to provide training and support for existing and  future CWT programs aimed at helping veterans with serious mental  illness find and maintain employment. VA headquarters also used targeted  funding approaches to allocate funds to medical centers to enhance  existing CWT programs through the addition of new staff and to establish  CWT programs at medical centers without such programs. VA  headquarters used targeted approaches to allocate funding for new and  expanded mental health intensive case management teams; grant and per  diem liaisons for homeless veterans; and PTSD, OIF and OEF veterans’,  and substance abuse services.
VA headquarters officials said that allocations made for initiatives in fiscal  year 2005 through RFPs and other approaches targeted to specific  initiatives would be made for a total of 2 to 3 fiscal years. These officials  said they anticipated that medical centers would hire permanent staff  whose positions would need to be funded for more than 1 year. The  expectation of VA leadership was that after funds allocated through these  approaches were no longer available, medical centers would continue to  support these programs using their general operating funds received  through VA’s general resource allocation system.
section_title: VA Allocated $35 Million through Its General Resource Allocation System to Its Health Care Networks on a Retrospective Basis
paragraphs: VA allocated $35 million for mental health strategic plan initiatives in fiscal  year 2005 through its general resource allocation system to its health care  networks, according to VA headquarters officials. The decision to allocate  these resources to VA’s networks for mental health strategic plan  initiatives was retrospective and VA did not notify networks and medical  centers of this decision. Although VA headquarters made fiscal year 2005  general resource allocations to the networks in December 2004, the  decision that $35 million in funds allocated at that time was for mental  health strategic plan initiatives was not finalized until April 2005, several  months after the general allocation had been made. VA headquarters  officials said that they made the decision to allocate $35 million from the  general resource allocation system because these resources would be  more rapidly allocated than if they had been allocated through RFPs.  However, other VA headquarters officials told us that the decision was  also made, in part, because VA did not have sufficient unallocated funds  remaining after the December 2004 general allocation to fund $100 million  for the mental health strategic plan through RFPs and other targeted  approaches.
VA headquarters officials, as well as network and medical center officials,  indicated that there was no guidance to the networks and medical centers  instructing them to use specific amounts from their general fiscal year  allocation for mental health strategic plan initiatives. Network and medical  center officials we spoke with in four networks were unaware that any  specific portion of their general allocation was intended by headquarters  officials to be used for mental health strategic plan initiatives. Several VA  medical center officials noted, however, that some of the funds in their  general allocation were used to support mental health programs generally,  as part of their routine operations. However, because network and  medical center officials we interviewed did not know that funds had been  allocated for mental health strategic plan initiatives through VA’s general  resource allocation system, nor did VA headquarters notify networks and  medical centers throughout VA of this retrospective allocation, it is likely  that some of these funds were not used for plan initiatives.
section_title: VA Did Not Allocate about $12 Million Planned for Mental Health Strategic Plan Initiatives
paragraphs: VA did not allocate approximately $12 million remaining of the   $100 million planned for mental health strategic plan initiatives in fiscal  year 2005 because, according to VA headquarters officials, there was not  enough time during the fiscal year to allocate the funds through the RFP  process or other approaches targeted to specific initiatives. In addition,  officials said that when resources were allocated later in the fiscal year  through an RFP, rather than at the beginning of the year, the amount  allocated was only a portion of the annualized cost. For example, if funds  for a project with an annual cost of $4 million were allocated midway  through the fiscal year, only half the annual cost was allocated at that  time—$2 million. The expectation was that the full $4 million would be  made available for the project over the 12 months in the next fiscal year.  The approximately $12 million in unallocated funds in fiscal year 2005 was  intended for mental health strategic plan initiatives based on an allocation  plan developed by VA. (See table 2.) About $11 million of the resources not  allocated was for services related to legislation that expressly required  spending or authorized such services, according to VA officials. VA  headquarters officials said that the funds not allocated for mental health  strategic plan initiatives were allocated for other health care services.
section_title: Medical Center Officials Reported Using Allocated Funds for Mental Health Strategic Plan Initiatives, but Not Using All Funds Allocated for Plan Initiatives
paragraphs: Officials we interviewed from seven medical centers in four networks  reported using the funds allocated to them for mental health strategic plan  initiatives through RFPs and other targeted approaches, but some officials  said that some of these funds were not used for plan initiatives in fiscal  year 2005. Officials said they used funds allocated to provide new mental  health services and to provide more of existing mental health services  included in plan initiatives. For example, officials at medical centers in  Bay Pines and the Tennessee Valley Healthcare System reported using  funds to increase the number of mental health providers at CBOCs, some  of which previously had no mental health providers available to see  veterans. The Albuquerque medical center used funds to develop a CWT- supported employment program to help veterans with mental health  diagnoses develop job skills and find employment. The Tennessee Valley  Healthcare System also implemented a new 6-week PTSD day treatment  program in which veterans live in the community but come to the medical  center during the day for counseling, group therapy, and other services.  The Tampa medical center funded new mental health staff to work with  veterans being treated in its Polytrauma Rehabilitation Center. The  Tuscaloosa medical center opened a new domiciliary for homeless  veterans and the Phoenix medical center hired a new grant and per diem  liaison for its homeless program. The medical centers in our review used  the mental health strategic plan funds for recurring uses, such as hiring  staff, and for nonrecurring uses. Nonrecurring uses included acquisition of  furniture and equipment as well as building renovation.
Officials at four medical centers reported that they were not able to use all  of their fiscal year 2005 funding by the end of the fiscal year as planned  and cited several factors that contributed to this situation. The length of  time it takes to recruit new staff in general and the special problems of  hiring specialized staff such as psychiatrists were cited. Officials at two  medical centers noted that they received funding for multiple new  positions, but that it was difficult for the medical center to recruit and hire  for so many positions in a relatively short period of time. In addition, in  some cases the need to locate or renovate space for mental health  programs contributed to delays in using funds. For example, officials at  the Albuquerque medical center reported that although it received funding  for staff for a new residential program, it took some time to renovate the  space needed for that program, which limited the amount of funding for  staff they were actually able to spend in fiscal year 2005.
Medical centers varied in how they treated fiscal year 2005 funds that were  allocated by VA for mental health strategic plan initiatives but not used for  those initiatives. Officials at three medical centers reported that they  carried over the funds for use in the next fiscal year. For example,  officials at the Phoenix medical center reported carrying over unused  funding for a substance abuse residential rehabilitation program. Officials  at two medical centers reported that they used these funds for other health  care purposes. For example, officials at the Albuquerque medical center  said that funding that was not used for staffing due to difficulties with  hiring was made available to meet other needs in the medical center for  that fiscal year. Officials at another medical center, the Tennessee Valley  Health Care System, reported having unused fiscal year 2005 funding due  to difficulties with hiring, and using this funding to support other mental  health programs, in particular to hire mental health staff for its CBOCs. VA  headquarters officials advised participants from networks and medical  centers in a weekly conference call in August 2005 that if they were unable  to hire staff for initiatives in fiscal year 2005, they should use the funds  allocated only for mental health services.
section_title: VA Allocated about $158 Million of the $200 Million Planned for Mental Health Strategic Plan Initiatives in Fiscal Year 2006, but Some Officials Were Uncertain If All Funds Would Be Used for Plan Initiatives
paragraphs: VA headquarters allocated about $158 million of the $200 million to be  used for VA mental health strategic plan initiatives in fiscal year 2006  directly to medical centers and certain offices by using several  approaches. About $92 million of these funds was allocated to support  new mental health strategic plan initiatives for fiscal year 2006. VA also  allocated about $66 million to support the recurring costs of the  continuing mental health strategic plan initiatives that were funded in  fiscal year 2005. The remaining approximately $42 million was not  allocated. Officials at some medical centers expected to use all the  allocations they received during fiscal year 2006. However, officials at  other medical centers were uncertain that they would use all their  allocated funds for plan initiatives during the fiscal year.
subsections: section_title: VA Allocated about $158 Million Directly to Medical Centers and Certain Offices
paragraphs: VA headquarters allocated about $158 million directly to medical centers  and certain offices through RFPs and other approaches targeted to  specific initiatives related to the mental health strategic plan in fiscal year  2006. (See table 3.) About $92 million was for new mental health strategic  plan activities, and about $66 million was to support the recurring costs of  continuing mental health strategic plan initiatives that were first funded in  fiscal year 2005. As in fiscal year 2005, the new resources went to support  a range of mental health services in line with priorities of VA’s leadership  and legislation, according to VA officials. Funding for services for PTSD,  OIF and OEF veterans, substance abuse, and CBOC mental health services  accounted for nearly three-fifths of the funds allocated for new initiatives.  VA did not allocate resources in fiscal year 2006 for mental health strategic  plan initiatives through its general resource allocation system, according  to VA officials.
VA headquarters officials used RFPs and other approaches targeted to  specific initiatives to determine which medical centers would receive  funding for new mental health strategic plan initiatives in fiscal year 2006.  In November 2005, for example, VA issued an RFP that covered six mental  health areas: PTSD services, including residential services; health  promotion and preventive care services for veterans returning from OEF  and OIF; specialized substance abuse treatment programs; new mental  health residential rehabilitation and treatment programs; enhanced or  new CBOC mental health services; and new telemental health programs to  provide mental health services through videoconferencing. VA also used  other approaches to target funds to medical centers for grant and per diem  program liaisons, new or expanded mental health intensive case  management teams, and expanded inpatient services at the Tennessee  Valley Healthcare System medical center. Further, VA allocated funding  for medical supplies, equipment, and office furniture for Gulf Coast mental  health programs affected by Hurricane Katrina. As in fiscal year 2005, VA  allocated funding to the Employee Education System to support  educational programs. VA also allocated funding to support additional  mental health initiatives such as the development of web-based support  tools for veterans with mental health concerns, infrastructure  improvements at residential rehabilitation treatment facilities, suicide  prevention efforts, and Stand Down events to provide services such as  counseling and health screenings for homeless veterans.
section_title: VA Did Not Allocate about $42 Million for Mental Health Strategic Plan Initiatives
paragraphs: VA did not allocate about $42 million of the $200 million planned for  mental health strategic plan initiatives in fiscal year 2006 by any approach.  The approximately $42 million in unallocated funds were intended for  certain mental health strategic plan initiatives based on an allocation plan  developed by VA. According to VA officials, VA was unable to allocate all  the $200 million, in part, because of the delayed implementation of three  new Centers of Excellence, focusing on veterans’ mental health issues,  including PTSD, for which VA planned allocations totaling $4.5 million.  VA officials also cited the unanticipated length of time required to refine  the processes for implementation of initiatives related to the provision of  mental health services in primary care settings. VA had solicited proposals  related to primary care mental health services through a May 2006 RFP  and had anticipated allocating about $11 million for such services from  funds reserved for emerging needs related to the mental health strategic  plan. In addition, VA officials reported that a portion of the funds were  unallocated for reasons related to the timing of allocations that were made  for plan initiatives through RFPs and other funds targeted to medical  centers. Specifically, some of these allocations were made well into the  fiscal year. VA allocated only the amount of funds through these  approaches for fiscal year 2006 that would fund the projects through the  end of the fiscal year, and not the full 12-month costs, which VA expects to  fund in fiscal year 2007. VA officials said they anticipated that the full   12-month allocation would be available for these projects in fiscal year  2007. Most of the unallocated funds had been planned for initiatives to  provide services that VA identified as not directly in response to legislation  that expressly required spending or authorized such services. (See   table 4.)
section_title: Medical Center Officials Reported Using Allocated Funds for Mental Health Strategic Plan Initiatives, but Were Uncertain Whether All Funds Allocated Would Be Used for Plan Initiatives
paragraphs: Officials at seven medical centers we interviewed in May and June of 2006  reported using funds allocated to them through RFPs and other  approaches to support new 2006 initiatives and to continue to support  initiatives funded in fiscal year 2005. Officials at four of these medical  centers told us that they were using these funds to support expanded  mental health services. For example, officials at several medical centers,  including Bay Pines, Decatur, and the Tennessee Valley Healthcare  System, reported using fiscal year 2006 funding to expand mental health  services in their CBOCs by adding clinical staff. As part of this expansion  of services, the Tampa medical center used funding for a new mental  health intensive case management program. Five medical centers had  received funding for expanded mental health services, but had not yet  used all of the allocated funds. The Albuquerque medical center, for  example, had received funding for a new substance abuse program for  geriatric patients and a new case management program for veterans with  PTSD. As of May 2006, both programs were still being developed and  positions had been advertised but had not yet been filled.
Officials at two medical centers reported that they did not anticipate  problems using all of the funds they had received in fiscal year 2006.  However, officials at four other medical centers were less certain they  would be able to use all of the funds. Officials at two of these medical  centers were not sure whether they would be able to hire all of their new  staff by the end of the fiscal year. In addition, officials at the Bay Pines and  Phoenix medical centers noted that they had not yet learned whether  proposals they submitted in response to fiscal year 2006 RFPs would be  funded; as a result, officials at those medical centers were uncertain  whether they would be able to use all of their fiscal year 2006 funds for  plan initiatives by the end of the fiscal year.
section_title: VA Tracking of Funds Spent for Mental Health Strategic Plan Initiatives Was Inadequate, but Available Information Indicates That Spending for These Initiatives Was Substantially Less Than Planned
paragraphs: VA tracking of spending for mental health strategic plan initiatives was  inadequate for fiscal years 2005 and 2006. In fiscal year 2005, VA  headquarters did not track spending on mental health strategic plan  initiatives. In fiscal year 2006, VA began to track some information on  medical centers’ mental health strategic plan initiatives, but did not track  the amount of allocated funds that was spent for them. VA headquarters  officials used this newly instituted tracking system to gather  implementation information reported by networks and medical centers on  a quarterly basis. The tracked information was primarily related to  positions to be filled, the schedule for filling them, and when they were  filled. Headquarters officials said that this tracking was intended, in part,  to measure medical centers’ progress in implementing plan initiatives.  Officials told us that they believe that tracking of hiring provides  information on how funds were spent because most costs of initiatives are  personnel costs. However, the data on hiring did not include information  on the individual salaries of staff, associated benefits, the portion of the  fiscal year for which staff are employed, equipment, supplies, rent, or  renovation of facilities. As a result the quarterly reports do not allow VA to  determine how much was spent on plan initiatives. In fiscal year 2006, VA  headquarters officials compiled information on the amount of funds  returned to headquarters that medical centers could not spend during the  fiscal year. However, VA does not have information on whether the funds  medical centers retained were spent for plan initiatives.
Available information indicates that spending of allocations for mental  health strategic plan initiatives was substantially less than planned in both  fiscal years 2005 and 2006. In fiscal year 2005, approximately $12 million of  the planned $100 million for plan initiatives was not allocated for plan  initiatives and thus was not spent on them. Thirty-five million dollars was  allocated through VA’s general resource allocation system, but because VA  headquarters did not specify that these funds were for mental health  strategic plan initiatives, it is likely that portions of this money were not  spent on them, and VA officials said they do not have information on these  funds being spent for plan initiatives. In addition, VA officials told us that  they did not have information on the extent to which the approximately  $53 million in funds that were allocated directly to medical centers and  certain offices was actually spent on plan initiatives. Officials at medical  centers we interviewed told us that they used some of these funds on  mental health activities other than the planned initiatives or carried over  funds until the next fiscal year.
In fiscal year 2006, available information indicates that the maximum  amount of allocated funds that could have been spent for plan initiatives in  fiscal year 2006 also fell substantially below what was planned. About   $42 million of the $200 million that was planned for allocation to mental  health strategic plan initiatives was never allocated for them, and thus,  never spent for plan initiatives. Additionally, about $46 million of the  approximately $158 million that was allocated was returned by medical  centers to headquarters because it had not been spent for plan initiatives  before the end of the fiscal year. However, all of the remaining  approximately $112 million of funds allocated to and retained by medical  centers and offices was not necessarily spent on plan initiatives as  originally planned. VA officials provided written guidance to medical  centers in August 2006 instructing them to spend funds for other mental  health activities if they could not spend them for the planned initiatives  before the end of the fiscal year. VA officials told us that because they had  provided instructions to spend the funds on mental health activities that  such activities would constitute spending on mental health strategic plan  activities. VA’s guidance, however, did not specify that funds be used for  the plan initiatives or alternative initiatives. Moreover, VA did not track  specifically how these funds were spent. As a consequence, VA cannot  determine how much of the approximately $112 million that was allocated  for plan initiatives and not returned to headquarters was spent on plan  initiatives.
section_title: Conclusion
paragraphs: VA allocated additional resources for mental health strategic plan  initiatives in fiscal years 2005 and 2006 to help address identified gaps in  VA’s mental health services for veterans. The allocations that were made  resulted in some new and expanded mental health services for plan  initiatives according to officials at selected medical centers. However, in  fiscal year 2005, lack of adequate time for headquarters to allocate funds  for plan initiatives to medical centers, late-in-the-year allocations that  hampered medical center efforts to bring staff on board during the fiscal  year, and a lack of guidance concerning allocations for plan initiatives  made through VA’s general resource allocation system resulted in  spending on initiatives falling short of what was planned. In fiscal year  2006, a larger amount, approximately $158 million of the planned   $200 million for plan initiatives, was allocated to medical centers and  other offices than in fiscal year 2005. However, at the end of the fiscal year  about $46 million was returned to VA headquarters that had not been  spent on mental health strategic plan initiatives, and some funds that  remained with medical centers and other offices may have been directed  towards mental health activities other than plan initiatives.
Although available information shows that a substantial portion of the  resources intended for plan initiatives in fiscal years 2005 and 2006 was  not spent on these initiatives, VA does not know the amount of allocated  funds actually spent on them. The extent of spending is unknown because  VA did not track spending of these funds. Although some tracking of  mental health strategic plan initiatives was started in fiscal year 2006, data  were not collected that would allow an assessment of spending. Tracking  the extent to which allocations for plan initiatives are spent for these  initiatives is important as VA continues to allocate resources for future  plan initiatives. This would help to ensure that the money is being spent as  planned, and that VA is in fact addressing gaps that it has identified in  mental health services for veterans.
section_title: Recommendation for Executive Action
paragraphs: To provide information for improved management and oversight of how  funds VA allocates are spent to fill identified gaps in mental health services  for veterans, we recommend that the Secretary of Veterans Affairs direct  the Under Secretary for Health to take the following action:  Track the extent to which the resources allocated for mental health  strategic plan initiatives are spent for plan initiatives.
section_title: Agency Comments
paragraphs: VA did not provide agency comments on the contents of this report. We  offered VA the opportunity to review and comment on the report, but not  retain copies of the draft as part of a process to help safeguard the  contents from unauthorized disclosure. VA in a written response  (reproduced in app. III) said that it was unable to provide comments on  the draft report because VA was not provided a copy of the report for  appropriate staffing to include review and analysis. VA further stated that  while it respected our desire to maintain the integrity of GAO draft reports  by preventing improper disclosure of draft contents, that this did not  outweigh the need for VA staff to have a copy of the draft report for review  and analysis. We have provided similar report review opportunities to  other agencies for other reports, and have received agency comments in  those circumstances.
We met with VA officials on November 14, 2006, and provided them with  an oral briefing covering the contents of the draft report. Further, a  portion of the contents of this report had previously been released as a  statement for the record at a hearing held by the House Veterans’ Affairs  Committee, Subcommittee on Health, on September 28, 2006. We  discussed the information in that statement with VA officials who have  responsibilities related to mental health services, budgeting, and the  allocation of financial resources, and they agreed that the data in the  statement were accurate. As a result, VA is aware of the report’s contents.
As agreed with your office, unless you publicly announce the contents of  this report earlier, we plan no further distribution of it until 30 days from  the date of this report. At that time, we will send copies to the Secretary of  Veterans Affairs, appropriate congressional committees, and other  interested parties. We will also make copies available to others upon  request. In addition, the report will also be available at no charge on the  GAO Web site at http://www.gao.gov. If you or your staff have any  questions about this report, please contact me at (202) 512-7101 or  ekstrandl@gao.gov. Contact points for our Offices of Congressional  Relations and Public Affairs may be found on the last page of this report.  GAO staff who made major contributions to this report are listed in  appendix IV.
section_title: Appendix I: Department of Veterans Affairs (VA) Health Care Networks, Medical Centers, and Other Facilities GAO Selected for Review
paragraphs: Medical centers and other facilities    Decatur, Ga., medical center    Tuscaloosa, Ala., medical center    Birmingham, Ala., Vet Center    Bay Pines, Fla., medical center    Tampa, Fla., medical center    Dunedin, Fla., community-based outpatient  clinic (CBOC)
section_title: Appendix II: Description of Selected Department of Veterans Affairs (VA) Mental Health Services
paragraphs: Community-based outpatient clinics (CBOC)
CBOCs provide medical services, which can include mental health, on an  outpatient basis in a community setting. CBOCs are affiliated with a VA medical  center.
CWT is a therapeutic work-for-pay program that (1) uses remunerative work to  maximize a veteran’s level of functioning, (2) prepares veterans for successful  reentry into the community, and (3) provides a structured daily activity to those  veterans with severe and chronic disabling physical and/or mental conditions.
Domiciliary residential rehabilitation and treatment programs for homeless  veterans, providing coordinated, integrated rehabilitative and restorative clinical  care in a bed-based program, with the goal of helping eligible veterans achieve  and maintain the highest level of functioning and independence possible.
VA offers grants to non-VA organizations in the community to provide  supportive housing programs and supportive service centers for homeless  veterans. Once programs are established, VA provides per diem payments to  help offset operational expenses of the program. Grant and per diem liaisons  oversee services provided by these organizations.
Mental health intensive case management teams are designed to deliver high- quality services that: (1) provide intensive, flexible community support;   (2) improve health status (reduce psychiatric symptoms and substance abuse);  (3) reduce psychiatric inpatient hospital use and dependency; (4) improve  community adjustment, functioning, and quality of life; (5) enhance satisfaction  with services; and (6) reduce treatment costs.
The Mentally Ill Chemically Addicted program, intended to assist underserved  veterans with serious and persistent mental illnesses, involves recovery- and  rehabilitation-oriented services in Network 17 as well as training on the recovery  model and psychosocial rehabilitation concepts and skills.
Operation Iraqi Freedom (OIF) and Operation  Enduring Freedom (OEF)
Assessment, preventative, and early intervention mental health services for  veterans returning from combat in Iraq, Afghanistan, and other areas. These  services involve outreach and education efforts, as well as a range of  psychosocial support services.
The Peer Housing Location Assistance Group pilot program is a recovery- oriented program that encourages and enables each veteran to take  responsibility and initiative to choose and apply for as many housing  opportunities as his or her eligibility characteristics, preferences, and motivation  permit. The program aims to help participants manage the process and  frustrations of finding and maintaining safe and secure housing through a  combination of information, problem-solving, encouragement, professional  assistance, and peer support.
A collaborative venture between the North Texas Health Care System and the  Texas Correctional Office on Offenders with Medical and Mental Impairments  that provides active outreach and case management services to veterans with  diagnosed mental illness being released from the Texas prisons and involves  work with the Texas diversion courts for mentally ill offenders to provide  outreach and case management services for veterans convicted of minor  offences who have been diagnosed with mental illness.
Polytrauma Rehabilitation Centers provide comprehensive interdisciplinary  rehabilitation and coordinated complex medical, surgical, and mental health  care, as well as long-term follow-up, to veterans of OIF and OEF who have  sustained severe injuries and have complex rehabilitation needs.
Specialized services for veterans returning from Iraq and Afghanistan, as well  as veterans from past service eras, including the Vietnam War. As part of VA’s  overall coordination of postdeployment programs, PTSD services are focused  on veterans who are survivors of traumatic events and require comprehensive  treatment.
A comprehensive approach to restoring a veteran’s full potential following the  onset of serious mental illness. This approach involves assisting the veteran in  all aspects of normal life to attain the highest level of functioning in the  community; it includes such components as patient and family education;  enhancement of residential, social, and work skills; cognitive behavioral  therapy; motivational interviewing, integrated dual diagnosis treatment, and  provision of intensive case management when needed.
Safety, security, privacy, access, and infrastructure improvements to domiciliary  and residential rehabilitation treatment programs, including repairs, renovations,  furnishings, appliances, equipments, household goods, and program supplies  and materials. A special emphasis for a component of these funds was  improving access to these mental health residential programs for women  veterans.
Stand Downs are typically 1 to 3 day events that provide services to homeless  veterans such as food, clothing, health screenings, VA and Social Security  benefits counseling, and referrals to a variety of other supportive services such  as housing, employment, and substance abuse treatment. Stand Downs are  collaborative events that are coordinated between local VA facilities, other  government agencies, and community agencies that serve the homeless.
Specialized services for veterans with substance abuse disorders such as  alcoholism and drug addictions. These services, for example, are provided in  residential rehabilitation treatment programs.
Initiative designed to obtain causes of death for veterans who have died in  recent years, to identify those who have died from suicide and related causes,  to identify risk factors, and to evaluate regional and local variability in rates and  risk factors. The goal is to obtain information that can guide evidence-based  efforts at suicide prevention, nationally and at other levels.
Special needs funding for medical supplies, equipment, office furniture, and  modular buildings for Gulf Coast VA mental health programs that sustained  damage due to Hurricane Katrina.
Telemental health uses electronic communications and information technology  to provide and support mental health care where geographic distance separates  the clinicians and patients. These services are often used in rural areas where  the availability of mental health providers is limited.
Initiative to develop an interactive set of web-based tools to allow veterans who  have behavioral or mental health concerns to track important aspects of their  self-care and professional care.
section_title: Appendix III: Comments from the Department of Veterans Affairs
section_title: Appendix IV: GAO Contact and Staff Acknowledgments
subsections: section_title: Acknowledgments
paragraphs: In addition to the contact named above, Debra Draper, Assistant Director;  James Musselwhite, Assistant Director; Jennie Apter; Robin Burke; and  Steven Gregory made key contributions to this report.
section_title: Related GAO Products
paragraphs: VA Health Care: Preliminary Information on Resources Allocated for  Mental Health Strategic Plan Initiatives. GAO-06-1119T. Washington,  D.C.: September 28, 2006.
VA Health Care: Budget Formulation and Reporting on Budget  Execution Need Improvement. GAO-06-958. Washington, D.C.:   September 20, 2006.
VA Long-Term Care: Data Gaps Impede Strategic Planning for and  Oversight of State Veterans’ Nursing Homes. GAO-06-264. Washington,  D.C.: March 31, 2006.
VA Long-Term Care: Trends and Planning Challenges in Providing  Nursing Home Care to Veterans. GAO-06-333T. Washington, D.C.:   January 9, 2006.
VA Health Care: VA Should Expedite the Implementation of  Recommendations Needed to Improve Post-Traumatic Stress Disorder  Services. GAO-05-287. Washington, D.C.: February 14, 2005.
VA Long-Term Care: Oversight of Nursing Home Program Impeded by  Data Gaps. GAO-05-65. Washington, D.C.: November 10, 2004.
VA and Defense Health Care: More Information Needed to Determine If  VA Can Meet an Increase in Demand for Post-Traumatic Stress Disorder  Services. GAO-04-1069. Washington, D.C.: September 20, 2004.
VA Health Care: Resource Allocations to Medical Centers in the Mid  South Healthcare Network. GAO-04-444. Washington, D.C.: April 21, 2004.
Department of Veterans Affairs: Key Management Challenges in Health  and Disability Programs. GAO-03-756T. Washington, D.C.: May 8, 2003.
VA Health Care: Allocation Changes Would Better Align Resources with  Workload. GAO-02-338. February 28, 2002.
Agencies’ Annual Performance Plans Under the Results Act: An  Assessment Guide to Facilitate Congressional Decisionmaking,   Version 1. GAO/GGD/AIMD-10.1.18. Washington, D.C.: February 1998.
Managing for Results: Critical Issues for Improving Federal Agencies’  Strategic Plans. GAO/GGD-97-180. Washington, D.C.: September 16, 1997.
Business Process Reengineering Assessment Guide, Version 3.  GAO/AIMD-10.1.15. Washington, D.C.: May 1997.
Agencies’ Strategic Plans Under GPRA: Key Questions to Facilitate  Congressional Review, Version 1. GAO/GGD-10.1.16. Washington, D.C.:  May 1997.