VA Long-Term Care: Changes In Service Delivery Raise Important Questions
Published: 2004-01-28T00:00:00

Fast Facts:

Highlights:
section_title: Why GAO Did This Study
paragraphs: The Department of Veterans Affairs (VA) is likely to see a significant increase in long-term care need over the next decade. The number of veterans most in need of longterm care services--those 85 years old and older--is expected to increase from about 870,000 to 1.3 million over this period. Many of these veterans will rely on VA to provide or pay for nursing home care or noninstitutional services that may help them remain at home and, for some, delay or prevent the need for nursing home care. VA operates its own nursing home care units in 132 locations. VA 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. Congress has expressed concerns about recent trends in VA long-term care service delivery and how VA plans to meet the nursing home care needs and related longterm care needs of veterans as the elderly population most in need of long-term care increases. GAO was asked to determine for fiscal years 1998 through 2003 (1) how VA nursing home workload has changed and (2) how VA noninstitutional long-term care workload has changed.
section_title: What GAO Found
paragraphs: Recent trends in VA nursing home care and noninstitutional service delivery raise important questions, particularly whether access to services is sufficient to meet the needs of a rapidly growing elderly veteran population. VA's overall nursing home workload--average daily census--was 33,214 in fiscal year 2003, 1 percent below its fiscal year 1998 workload. The workload was below the fiscal year 1998 level each year, decreasing by as much as 8 percent below the fiscal year 1998 level in fiscal year 2000. VA's use of nursing home care by setting also changed over the 6-year period. First, the percentage of workload in state veterans' nursing homes increased as the number of state veterans' nursing homes receiving VA payments increased. Second, the percentage of workload in VA's own nursing homes declined, in part, because VA decreased the number of long-stay patients and increased the number of short-stay patients it treats in the nursing homes it operates. This is consistent with VA's increased emphasis on post-acute care. Third, the percentage of workload in community nursing homes declined from 17 to 13 percent. VA officials told us that now shorter-term contracts are often used to transition veterans to nursing home care, which is paid for by other payers such as Medicaid. VA's noninstitutional long-term care workload--average daily census--increased by approximately 75 percent from fiscal years 1998 through 2003. Workload increased by 4,655 during this period to 10,892, reflecting a change in VA's approach to care which includes meeting more long-term care need through noninstitutional services. Most of the growth in noninstitutional workload came from VA's greater use of contract skilled home health care, which includes medical services provided to veterans at home, and homemaker/home health aide such as grooming and meal preparation.

section_title: Letter
paragraphs: We are pleased to be here today to discuss veterans’ use of long-term care  services, which include nursing home care and noninstitutional services  provided or paid for by the Department of Veterans Affairs (VA). Concern  with meeting veterans’ long-term care needs is increasing as the number of  veterans most in need of these services—those 85 years old and older—is  expected to increase from about 870,000 this year to 1.3 million over the  next decade. Many of these veterans will seek assistance from VA to  provide or pay for nursing home care or a range of noninstitutional  services that may help them remain at home and, for some, delay or  prevent the need for nursing home care.
To provide assistance to veterans with chronic illness or physical or  mental disability, VA provides a continuum of institutional and  noninstitutional long-term care services. VA provides care that its own  employees deliver and contracts with other health care providers to  deliver care. VA operates its own nursing home care units in 132 locations  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. VA also provides noninstitutional services to veterans in  their own homes or in community settings using both its own employees  and through contracts with other providers.
This Committee has expressed concerns about recent trends in VA long- term care service delivery and how VA plans to meet the nursing home  care needs and related long-term care needs of veterans as the elderly  population most in need of long-term care increases. To assist the  Committee in its oversight responsibilities in this area, you asked us to  determine for fiscal years 1998 through 2003 (1) how VA nursing home  workload has changed and (2) how VA noninstitutional long-term care  workload has changed.
My testimony today is based on our ongoing review of long-term care  workload for this Committee. 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 also measured noninstitutional workload using  average daily census; however, the number of veterans receiving these  services may be less than workload because a veteran may receive more  than one service in a day. We analyzed data on nursing home workload  that VA provided to determine how workload had changed from fiscal  years 1998 through 2003. We also verified VA’s nursing home workload  numbers based on contacts with officials from VA’s 21 health care  networks and VA headquarters. To determine how noninstitutional long- term care workload has changed during this period, we analyzed data on  visits for six noninstitutional services which VA either provides directly or  pays for others to provide: home-based primary care, adult day health  care, homemaker/home health aide, skilled home health care, home  respite care, and home hospice care. We also interviewed VA officials at  headquarters and obtained information from the networks to better  understand the reasons for changes in nursing home workload during this  period. In doing our work, we tested the reliability of the data and  determined they were adequate for our purposes. We did our work in  accordance with generally accepted government auditing standards from  January 2003 through January 2004.
In summary, recent trends in VA nursing home and noninstitutional  service delivery raise important questions, particularly whether access to  services is sufficient to meet the needs of a rapidly growing elderly veteran  population. VA’s overall nursing home workload—-average daily census—- was 33,214 in fiscal year 2003, 1 percent below its fiscal year 1998  workload. The workload was below the fiscal year 1998 level each year,  decreasing by as much as 8 percent below the fiscal year 1998 level in  fiscal year 2000. Fourteen of 21 networks experienced declines in nursing  home workload during this period. Moreover, VA’s use of the three nursing  home settings changed over this 6-year period. First, the percentage of  workload met in state veterans’ nursing homes increased from 43 to 50  percent as the number of state veterans’ nursing homes receiving VA  payment increased. The percentage of workload met in state veterans’  nursing homes increased in 19 of VA’s 21 health care networks. Second,  the percentage of workload in VA’s own nursing homes declined from 40  to 37 percent. Thirteen networks provided a smaller percentage of  workload in VA-operated homes during this period. The percentage of  workload provided in VA-operated homes declined, in part, because VA  decreased the number of long-stay patients and increased the number of  short-stay patients it treats in its own nursing homes. This is consistent  with VA’s policy to give priority to post-acute patients and certain other  nursing home patients.  VA generally provides long-term nursing home  care as resources permit. Third, the percentage of workload in community  nursing homes declined from 17 to 13 percent. Seventeen networks  reduced the percentage of their nursing home workload provided in  community nursing homes during this period.
VA’s noninstitutional long-term care workload—-average daily census—- increased by approximately 75 percent from fiscal years 1998 through  2003. Workload increased by 4,655 during this period to 10,892, reflecting a  change in VA’s approach to care which includes meeting more long-term  care need through noninstitutional services. Most of the growth in  noninstitutional workload came from VA’s greater use of contract skilled  home health care, which includes medical services provided to veterans at  home, and homemaker/home health aide services such as grooming and  meal preparation. These services are most likely to help veterans prevent  or delay the need for nursing home care.
subsections: section_title: Background
paragraphs: Meeting veterans’ long-term care needs has become a more pressing issue  as the veteran population ages. The elderly veteran population most in  need of long-term care—those 85 years and older—-grew dramatically  from about 387,000 to about 764,000, an increase of about 100 percent  from fiscal years 1998 to 2003. (See fig. 1.)
Over the past two decades the provision of long-term care has been  shifting away from institutions and nursing homes towards more  noninstitutional long-term care services in VA and in other programs. In  recognition of this change in approach to how long-term care is provided,  the Federal Advisory Committee on the Future of VA Long-Term Care  recommended, in 1998, that VA update its long-term care policy by  meeting the growing demand for long-term care through significant  expansion of its capacity to provide home and community-based  services—also known as noninstitutional long-term care services—while  maintaining its nursing home capacity at the 1998 level.
VA provides a continuum of noninstitutional long-term care services to  provide care to veterans needing assistance. Long-term care provided in  noninstitutional settings—-including services provided in veterans’ homes  and community-based services such as adult day health care centers—-is  preferred by many veterans. Noninstitutional care also includes respite  care services that temporarily relieve a veteran’s caregiver from the  burden of caring for a chronically ill and disabled veteran in the home. VA  offers noninstitutional long-term care services directly or through other  providers with which VA contracts. (See table 1 for the noninstitutional  long-term care services in our review.)
Veterans can also receive nursing home care and noninstitutional services  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 nursing home  care and home and community-based services. Medicare primarily covers  acute care health costs and therefore limits its nursing home coverage to  short-term stays following hospitalization. Medicare also pays for home  health care. State Medicaid programs are the principal funders of nursing  home and home health care services, besides patients self-financing their  care. We have estimated that private insurance pays for about 11 percent  of nursing home and home health care expenditures.
section_title: Nursing Home Workload Declined Slightly And Use Of Nursing Home Care By Setting Changed
paragraphs: VA’s overall nursing home workload—-average daily census—-was 33,214  in fiscal year 2003, slightly below its fiscal year 1998 workload. However,  the workload was below the fiscal year 1998 level each year, reaching its  lowest level in fiscal year 2000. Over the last 6 years, VA’s use of nursing  homes by setting changed. These changes in workload and use of different  settings to provide nursing home care varied by network.
subsections: section_title: Nursing Home Workload Declined Slightly from Fiscal Year 1998 through Fiscal Year 2003
paragraphs: VA’s nursing home workload was 33,214 in fiscal year 2003, 1 percent  below its fiscal year 1998 workload. (See table 2.) Nursing home workload  varied over this period but was consistently below the fiscal year 1998  level, decreasing by as much as 8 percent in fiscal year 2000 from its fiscal  year 1998 level. The distribution of the nursing home workload among the  three nursing home settings shifted during this period. From fiscal years  1998 through 2003, workload in the nursing homes VA operates declined  by 1,014. In addition, workload in community nursing homes declined by  1,434. In contrast, workload in state veterans’ homes increased by 2,032.
Although VA nursing home workload did not change greatly from fiscal  years 1998 through fiscal year 2003, some networks experienced  significant increases or decreases. Fourteen of VA’s 21 networks had  lower nursing home workloads in fiscal year 2003 than in fiscal year 1998  for all three settings combined. (See fig. 2.) Network 5 (Baltimore) had the  largest decline in workload—19 percent. Seven networks’ nursing home  workloads grew during this period. Network 17 (Dallas) had the largest  increase in nursing home workload—42 percent.
section_title: Use of Nursing Home Care Setting Changed from Fiscal Year 1998 through 2003
paragraphs: VA’s use of nursing home care among the three settings changed from  fiscal years 1998 through 2003. The percentage of workload met in state  veterans’ nursing homes increased from 43 to 50 percent. (See fig. 3.) This  increase is attributable in large part to 18 more state veterans’ nursing  homes receiving payment from VA to provide such care. By fiscal year  2003, 109 state veterans’ nursing homes received VA payment to provide  this care. 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.
The percentage of workload provided in state veterans’ nursing homes  increased in 19 of VA’s 21 health care networks. Network 17 (Dallas) had  the largest increase in the percentage of workload provided by state  veterans’ nursing homes. The percentage of nursing home care provided  by state veterans’ nursing homes in this network increased from 0 to 30  percent during this period after the opening of four state veterans’ nursing  homes in Texas. By contrast, the percentage of workload provided by state  veterans’ nursing homes declined in 2 networks: Network 5 (Baltimore) by  3 percent and Network 21 (San Francisco) by 2 percent.
The percentage of nursing home workload provided in VA’s own nursing  homes declined from 40 to 37 percent during this period. Thirteen  networks provided a smaller percentage of nursing home care in VA- operated nursing homes in fiscal year 2003 than in fiscal year 1998.  Network 17 (Dallas) had the largest decrease in the percentage of  workload provided by VA-operated nursing homes, declining from 68  percent to 49 percent during this period. This resulted because the state  veterans’ nursing home workload increased substantially. By contrast, the  percentage of care provided in VA-operated homes increased in 8  networks. Network 5 (Baltimore) had the largest increase, growing from  50 percent in fiscal year 1998 to 64 percent in fiscal year 2003. In Network  21 (San Francisco), the percentage of care in VA-operated nursing homes  increased by 7 percent and in the remaining 6 networks the percentage of  care in VA-operated nursing homes increased 3 percent or less.
Our analysis of length-of stay trends in VA-operated nursing homes shows  that the decline in the number of veterans with long stays—90 days or  more—largely explains the decline in nursing home workload during this  period. The number of long-stay veterans declined from about 14,200 in  fiscal year 1998 to about 12,700 in fiscal year 2002, the most recent year for  which data are available. At the same time the number of short-stay  veterans—-those with stays of less than 90 days—-increased from about  26,700 to about 32,200. However, the increase in short-stay patients was  not large enough to offset the decline in workload resulting from the  decrease in long-stay patients. This results because multiple short-stay  patients are required to generate the same workload as a single long-stay  patient. For example, a single long-stay patient in a nursing home for 12  months creates a workload of an average daily census of 1 over a year. By  contrast, 12 short-stay patients staying in a nursing home for one month  each creates the same average daily census.
Among VA’s networks, 16 had declines in the number of long-stay patients  in VA-operated homes during this period. Five networks, however, had  increases in the number of long-stay patients: Network 1 (Boston),  Network 5 (Baltimore), Network 7 (Atlanta), Network 12 (Chicago) and  Network 21 (San Francisco).
VA officials attribute some of the changes in nursing home workload in  VA-operated facilities to an increased emphasis on short-term, post-acute  rehabilitation care. VA’s policy is to provide nursing home care in its own  nursing homes as a priority to post-acute patients, patients who cannot be  adequately cared for in community nursing homes or in noninstitutional  settings, and those patients who can be cared for more efficiently in VA’s  own nursing homes. In addition, VA may provide nursing home care, to the  extent resources are available, to other patients who need long-term care  for chronic disabilities. Consistent with VA’s policy, the proportion of  discharged veterans whose length of stays were less than 90 days in VA- operated nursing homes increased from 74 to 81 percent from fiscal years  1998 through 2003. This is similar to lengths of stay provided in facilities  certified by Medicare—-but not Medicaid—-that provide post-acute skilled  nursing home care. About 81 percent of discharged patients in these  certified Medicare facilities had length of stays of less than 90 days in  fiscal year 1999.
The percentage of workload in community nursing homes declined from  17 to 13 percent from fiscal year 1998 through fiscal year 2003. This  decline occurred because VA reduced the number of patients served and  the number of days paid for under contract in this setting. The number of  patients in these settings declined from 28,893 to 14,032 during this  period. Some VA officials told us that in the past VA used community  nursing homes for more patients and for longer-term contracts than  currently. VA officials told us that now shorter-term contracts are often  used to transition veterans to nursing home care, which is paid by other  payers such as Medicaid. For example, some network officials told us that  contracts for community nursing home care are often 30 days or less.
Of the 21 networks, 17 reduced the percentage of nursing home workload  provided in community nursing homes during this period. Four networks  reduced the percentage of nursing home care provided in community  nursing homes by about 11 percent: Network 4 (Pittsburgh), Network 5  (Baltimore), Network 6 (Durham), and Network 17 (Dallas). By contrast,  the percentage of workload provided in community nursing homes  increased in 4 networks. The percentage of nursing home care provided in  community nursing homes in Network 19 (Denver) increased by about 10  percent. The percentage of nursing home care provided in community  nursing homes among the other 3 networks—- Network 23 (Minneapolis),  Network 20 (Portland), and Network 18 (Phoenix)—-increased 3 percent  or less.
section_title: VA Noninstitutional Long-Term Care Workload Increased
paragraphs: VA’s noninstitutional long-term care workload—-average daily census—- for the six services in our review increased by approximately 75 percent  from fiscal years 1998 through 2003. Workload increased by 4,655 during  this period to 10,892. (See table 3.) Much of this growth came from  increases in skilled home health and homemaker/home health aide care— services that are most likely to help veterans prevent or delay the need for  nursing home care. One of the services that grew most rapidly was skilled  home health care which increased by 127 percent during this period.  Although noninstitutional long-term care workload increased, all veterans  may not have access to these services because there are limitations in the  availability of these services. We previously reported a number of  limitations in access to noninstitutional services that veterans experienced  in the fall of 2002. At that time some facilities did not offer some of these  noninstitutional services at all, or offered them only in certain parts of the  geographic area they served. For example, more than half of VA’s 139  medical facilities did not provide home-based primary care or adult day  health care in the fall of 2002.
The noninstitutional workload numbers for home-based primary care in  table 3 are different from those reported by VA in its appropriations  submissions to Congress and in recent VA testimony. In its reports on  noninstitutional workload, VA has measured home-based primary care  services using enrolled days—-the number of days a veteran is enrolled to  receive a service—-rather than the number of home-based primary care  visits a veteran receives. However, VA has measured use of the other  noninstitutional services in visits. Therefore, to ensure comparability  across services, we used visits as the workload measure for home-based  primary care. As a result, our workload total for home-based primary care  is smaller than the number VA reports because veterans do not typically  receive a home-based primary care visit for each day in which they are  enrolled in home-based primary care. Specifically, we report the 2002  home-based primary care workload as 903 while VA has reported it as  8,081. Our consistent measure of all services in visits results in a lower  total noninstitutional workload than that reported by VA.
section_title: Concluding Observations
paragraphs: Over the last 6 years, the veteran population most in need of long-term  care has grown dramatically. During this period, VA’s use of nursing home  care by setting has changed so that state veterans’ nursing homes now  provide one-half of all nursing home workload provided or paid for by VA.  At the same time, VA decreased the workload it serves in its own nursing  homes consistent with VA’s policy to emphasize short-stay, post-acute care  in its own nursing homes. VA also used community nursing home care less  as it transitioned more veterans who needed such care to care paid for by  other payers such as Medicaid. In addition, VA increased the long-term  care workload provided in noninstitutional settings.
These trends over the last 6 years raise important questions for how VA is  meeting current long-term care need and what it may need to do to meet  future long-term care need.
What does the significant variation in nursing home workload change  among the networks over this 6-year period mean for meeting veterans’  long-term care needs in different parts of the country?
What are the implications for access, quality, and costs of VA’s significant  shift to using state veterans’ nursing homes to provide one-half of its  nursing home care?
How has VA’s increased emphasis on post-acute care in its own nursing  homes affected its ability to continue providing long-term care in its  nursing homes for veterans with chronic disabilities?
To what extent does total VA long-term care workload—-composed of a  fairly constant nursing home workload and a rapidly expanding but  smaller noninstitutional workload—-meet the needs of a rapidly growing  elderly veteran population?
The continuing rapid rise in the veteran population likely to be in greatest  need of long-term care—-those 85 years and older—-poses a major  challenge for VA health care. Answers to these four questions can help  policymakers, VA, and its stakeholders better understand the best ways to  meet VA’s long-term care challenge.  We look forward to continuing to  work with you on these significant issues.
Mr. Chairman, this concludes my prepared remarks. I will be pleased to  answer any questions you or other Members of the Committee may have.
subsections: section_title: Contact and Acknowledgments
paragraphs: For further information regarding this testimony, please contact me at  (202) 512-7101. Individuals making key contributions to this testimony  include James C. Musselwhite, Thomas A. Walke, and Pamela A. Dooley.
section_title: Related GAO Products
paragraphs: 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.
Long-Term Care: Availability of Medicaid Home and Community  Services for Elderly Individuals Varies Considerably. GAO-02-1121.  Washington, D.C.: September 26, 2002.
Medicare: Utilization of Home Health Care by State. GAO-02-782R.  Washington, D.C.: May 23, 2002.
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.
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