Nationwide, VA provides or pays for veterans’ nursing home care in three settings: CLCs, community nursing homes, and state veterans’ nursing homes.the cost of care that is covered for eligible veterans. These settings vary in terms of their characteristics, as well as VA provides nursing home care to veterans in 134 CLCs nationwide. CLCs are typically within or in close proximity to VA medical centers. VA requires CLCs to meet The Joint Commission’s long-term care standards. veterans in CLCs, while discretionary veterans may be required to pay a copayment depending on their income or other factors. See Veterans Health Administration Handbook 1142.01, Criteria and Standards for VA Community Living Centers (Aug. 13, 2008). The Joint Commission is an independent organization that accredits and certifies health care organizations and programs in the United States. Medicare is the federal health insurance program for people age 65 and older, individuals under age 65 with certain disabilities, and individuals diagnosed with end-stage renal disease. Medicaid is a federal-state program that provides health care coverage to certain categories of low-income individuals. pays for the full cost of care for mandatory veterans, while discretionary veterans may be subject to a similar copayment as in CLCs depending on their income or other factors. However, VA is generally restricted by law from paying for more than 6 months of care for discretionary veterans. These veterans must therefore have other sources of payment, and, according to VA officials, most long-stay residents may enroll in Medicaid, have private long-term care insurance, or pay for care through out-of- pocket spending. VA also pays for all or part of veterans’ care in 140 state veterans’ nursing homes nationwide. For state veterans’ nursing homes, VA pays at least a portion of the cost of providing nursing home care for eligible veterans in these homes, but does not control the admission process. Veterans are admitted based on eligibility criteria as established by state requirements. For state veterans’ nursing homes to participate in VA’s program, however, VA generally requires that at least 75 percent of the In addition, VA requires state veterans’ nursing residents be veterans. homes to be certified by VA annually, and ensures compliance with its standards through surveys and audits. Each fiscal year, VA establishes the per diem rates paid to state veterans’ nursing homes for care provided to veterans. For mandatory veterans, VA pays a higher per diem For discretionary that covers the full cost of care, including medications.veterans, VA pays the lesser of the basic per diem established by VA or one-half of the total daily cost of care.nursing homes, there is no restriction on the number of days for which VA may pay for care for discretionary veterans in state veterans’ nursing homes. As part of VA’s support and oversight of state veterans’ nursing homes, VA medical centers of jurisdiction process and approve per diem reimbursements for the state veterans’ nursing homes located in their geographic areas. In addition to paying some or all of the cost of providing nursing home care to veterans, VA supports state veterans’ nursing homes by awarding grants to states for construction or renovation of facilities. These grants are awarded following VA’s review and approval of proposals submitted by state officials. In addition to per diem payments and construction grants from VA, state veterans’ nursing homes may receive payments from a number of different sources, including Medicare and Medicaid. While veterans of all ages may need VA nursing home care, the need for such care increases with age because elderly veterans are more likely to have functional or cognitive limitations that indicate a need for nursing home care. in 2014 and decline thereafter (see fig. 1). However, the percentage of elderly veterans is expected to remain relatively unchanged due to a decline in the overall veteran population. Although the need for VA nursing home care remains, for over a decade VA has highlighted the potential benefits of providing veterans with alternative options for long- term care—specifically, less costly home and community-based care—in an effort to lessen the need for more costly nursing home care. For example, in its 2014 budget justification, VA proposed legislation that would authorize VA to pay for care in VA-approved medical foster homes for veterans who would otherwise need nursing home care. Functional limitations are physical problems that limit a person’s ability to perform routine daily activities, such as eating, bathing, dressing, paying bills, and preparing meals. Cognitive limitations are losses in mental acuity that may also restrict a person’s ability to perform such activities. Institutionalization in a nursing home is more common at older ages—in 2010, about 1 in 8 people age 85 or older resided in institutions, compared with 1 percent of people ages 65 to 74. See Congressional Budget Office: Rising Demand for Long-Term Services and Supports for Elderly People (Washington D.C.: June 2013). Decisions about the nursing home setting in which a veteran will receive care are decentralized to the local level because of several factors, including variability in the choice of available settings, the nursing home care services available, and admissions policies at each type of setting. In addition, veterans’ nursing home service needs, eligibility status, and preferences about the location of care are considered in deciding the setting to choose. VA program officials told us that the decisions as to which nursing home setting would be used are decentralized to the local level because they are dependent upon several factors including the type of setting available in each community, and availability varies considerably across locations. For example, veterans in need of nursing home care in Augusta, Maine who wish to stay within about a 50-mile radius may have the option of receiving care from several settings including 1 CLC, 12 community nursing homes and 2 state veterans’ nursing homes, assuming availability of beds and resources. However, veterans in Saginaw, Michigan wishing to stay within a similar radius may have the option of receiving care from 1 CLC and 3 community nursing homes, depending on the availability of beds and resources, since the only 2 state veterans’ nursing homes are over 100 miles away. In addition, VA officials told us that decisions about which setting is used are based upon veterans’ specific nursing home service needs, and settings varied in the type of specific services offered. For example, officials told us that in certain geographic areas CLCs provide certain services that are not available in the community, such as dementia care, behavioral health services, and care for ventilator-dependent residents. In other areas, however, officials told us that these specialized services might not be available in a CLC and instead might be available at a community nursing home. When an individual medical center has more than one CLC in its service area, each CLC may offer a unique set of services. Therefore, according to officials, the availability of different types of services in each nursing home setting depends largely on location. VA officials further told us that admissions policies are generally the same for all CLCs, but may vary for community nursing homes and state veterans’ nursing homes. CLCs are required to provide care based on agency-wide policies; therefore, eligibility criteria and admissions policies are generally uniform across the country. An interdisciplinary team— including personnel such as a registered nurse, social worker, recreation therapist, medical provider, dietitian, and any other discipline(s) directly involved in the care of the resident—at the VA medical center of jurisdiction determines whether the veteran has a clinical need for nursing home care. This determination is to be based on a comprehensive clinical assessment of medical, nursing and therapy needs; level of functional impairment; cognitive status; rehabilitation needs; and special emphasis care needs, such as spinal cord injury or end-of-life care. Each CLC is required to use a standardized instrument that is used by all Centers for Medicare & Medicaid Services-certified nursing homes for assessment, treatment planning, and documentation and evaluation of care and services. Three key factors are considered at the time of admission: (1) the specific services to be provided; (2) whether the stay is short or long; and (3) the setting to which the resident will be discharged. Admissions policies are generally standardized for community nursing homes, but may vary for state veterans’ nursing homes based on state requirements. Community nursing homes are required to be certified for participation in the Medicare and Medicaid programs, and use the same standardized instrument for assessment, evaluation and treatment planning as CLCs. VA officials told us that community nursing homes are required to accept all eligible veterans referred by VA, subject to availability of beds and required resources. State veterans’ nursing homes are not required to provide VA with documentation of their admissions policies. Since these homes are state-owned and operated entities they are subject to admissions and eligibility criteria that vary from state to state. For example, for admission, state veterans’ nursing homes in Alabama require the veteran to have 90 days of service, at least one day of which was wartime service. In contrast, state veterans’ nursing homes in New York require the veteran to have only 30 days of active service, while homes in Florida do not require any wartime service. In addition to the type of available settings, the nursing home care services available, and admissions policies at each type of setting, VA officials told us that veterans’ eligibility status, and preferences about remaining close to home and family or willingness to travel to a nursing home setting were important considerations. For example, a discretionary veteran with a preference for staying close to home might be a candidate for admission to a community nursing home or a state veterans’ nursing home if a CLC was too far away. However, officials told us that because of the veteran’s discretionary status, he or she would be informed of VA’s restriction of coverage to only the first 180 days of care in the community nursing home, and staff would assist the veteran in obtaining Medicaid coverage. The veteran’s eligibility status would be less important if admission was made to the state veterans’ home since the restriction on length of coverage would not apply to this setting. However, officials emphasized that these considerations were made within the context of the availability of specific settings, specific services, and eligibility criteria and admissions policies across locations. Given the variability in these factors, veterans in two different communities with the same service needs, eligibility status and preferences might be admitted to different settings. Of the three VA nursing home settings, state veterans’ nursing homes provided care for just over half of VA’s nursing home workload in fiscal year 2012. VA’s total nursing home workload was primarily long stay that year. Most of the nursing home care that VA provided or paid for in fiscal year 2012 was for discretionary veterans and for residents ages 65 to 84 years old. In addition, veterans’ eligibility status and age varied by setting. State veterans’ nursing homes accounted for 53 percent of the workload—measured by average daily census—for which VA provided or paid for care in fiscal year 2012. CLCs provided care for 28 percent of the total workload, and community nursing homes provided care for 19 percent of the workload. (See fig. 2.) In fiscal year 2012, the most recent year for which data were available, state veterans’ nursing homes provided care to an average of 19,355 residents per day, out of the total average daily workload of 36,250 residents for whom VA provided or paid for nursing home care. This and other workload patterns we examined have been consistent in recent years based on VA data for fiscal years 2010-2012. At the network level, the proportion of nursing home workload in each setting varied widely by network, particularly the range of workload in state veterans’ nursing homes compared to the other settings. For example, state veterans’ nursing homes comprised 74 percent of total VA nursing home workload in Veterans Integrated Service Network (VISN) 16 (South Central VA Health Care Network), compared to 20 percent of the nursing home workload in VISN 21 (Sierra Pacific Network). (See app. I for more information on nursing home workload by network and setting.) Overall, long-stay care accounted for nearly 90 percent of VA’s total nursing home workload in fiscal year 2012 (31,750 of the 36,250 residents for whom VA provided or paid for care each day), and long-stay care accounted for at least three-quarters of all workload in each of VA’s three nursing home settings. (See fig. 3.) Of the three settings, state veterans’ nursing homes had the largest proportion of long-stay workload (97 percent) compared to community nursing homes (80 percent) and VA’s CLCs (76 percent). These patterns were consistent from fiscal year 2010 through fiscal year 2012. VA officials told us that they examine workload data by length of stay for planning purposes, but do not make these data available publicly. For all of the networks, the majority of workload was long-stay. The proportion of long-stay workload ranged from 80 percent to 95 percent, with the lowest proportion of long-stay workload in VISN 18 (VA Southwest Health Care Network), VISN 21 (Sierra Pacific Network), and VISN 22 (Desert Pacific Healthcare Network), and the highest proportion of long-stay workload in VISN 3 (VA New York/New Jersey Veterans Healthcare Network). (See app. II for information on workload by network and length of stay.) VA officials said that they thought long-stay care (measured by average daily census) accounted for a high proportion of CLC workload because CLCs provide a number of long-stay programs for veterans who are unable to access certain nursing home services in other settings. For example, according to VA officials, some CLCs offer specialized long-stay programs for residents with dementia or spinal cord injuries, and may also serve residents with mental or behavioral health conditions who are not eligible for nursing home care in other settings. Nearly two-thirds (62 percent) of VA’s nursing home care in fiscal year 2012 was provided to discretionary veterans, while just over one-third (35 percent) was provided to mandatory veterans. When examined by age group, nursing home residents 65 through 84 years of age comprised a larger proportion of the workload than other age groups, amounting to 45 percent of VA’s nursing home workload. Residents age 85 and older amounted to 37 percent, and those under 65 years of age amounted to 16 percent. (See fig. 4.) At the network level, workload by resident characteristics generally mirrored overall patterns. Workload for most networks was largely discretionary, with discretionary care comprising at least half of the workload in 20 of VA’s 21 networks. Discretionary workload ranged from 40 percent of total workload in VISN 21 (Sierra Pacific Network) to 69 percent of total workload in VISN 7 (VA Southeast Network) and VISN 3 (VA New York/New Jersey Veterans Healthcare Network). (See app. III for information on workload by network and eligibility status.) In addition, residents 65 through 84 years of age comprised similar proportions of workload in each network. Specifically, the proportion of workload for residents 65 through 84 years of age ranged from 42 percent in VISN 1 (VA New England Healthcare System), VISN 3 (VA New York/New Jersey Veterans Healthcare Network), VISN 15 (VA Heartland Network), and VISN 21 (Sierra Pacific Network) to 50 percent in VISN 6 (VA Mid- Atlantic Health Care Network) and VISN 11 (Veterans in Partnership). (See app. IV for information on workload by network and resident age.) The proportion of nursing home workload by veterans’ eligibility status— mandatory veterans compared to discretionary veterans—varied widely by setting. State veterans’ nursing homes provided the highest proportion of discretionary care compared to the other nursing home settings— 84 percent of workload in state veterans’ nursing homes was for care provided on a discretionary basis, compared to 48 percent of workload in CLCs and just 18 percent in community nursing homes. Conversely, community nursing homes provided the highest proportion of mandatory care (82 percent of workload), followed by CLCs (52 percent) and state veterans’ nursing homes (9 percent). (See table 1.) The proportion of workload by age group also varied among the three settings. Of the three settings, state veterans’ nursing homes had the highest proportion of workload for veterans age 85 and older. State veterans’ nursing homes also had the smallest proportion of workload for residents under age 65, who constituted less than a tenth of the workload. CLCs and community nursing homes had about the same proportions of workload for each age group, and in contrast to state veterans’ nursing homes, they had higher proportions of workload for residents under age 65 (27 and 24 percent of workload, respectively, compared to 8 percent). These patterns indicate that the characteristics of resident populations varied distinctly across settings. A higher proportion of workload in state veterans’ nursing homes was for discretionary and older veterans than in the other two settings. In addition, while workload in CLCs and community nursing homes had a similar age distribution of residents, community nursing homes had a higher proportion of workload for mandatory veterans than CLCs. VA officials told us that, at the national level, they rely on workload data for planning and budgeting purposes, especially to ensure that there are adequate resources to serve mandatory veterans. Officials said that reviewing the mix of mandatory versus discretionary veterans is particularly important since VA is required to serve the needs of mandatory veterans. VA officials told us that age data are also becoming important because VA now has a cohort of younger residents, and VA needs to be attuned to these population changes to ensure the required services are available. However, VA does not currently publish data on nursing home workload disaggregated by length of stay and resident characteristics in its budget justification. As a result, VA is not providing workload data on nursing home care provided or paid for to the maximum extent possible as encouraged by OMB guidance to justify staffing and other requirements. Congressional stakeholders therefore have incomplete information on the type of workload (long-stay or short-stay) being provided in each nursing home setting, as well as how settings differ in eligibility status and age of residents they serve. The lack of such information could hinder congressional budgeting and program decision making and oversight regarding VA’s staffing and resource requirements for providing nursing home care. Just under three-quarters of VA’s total nursing home expenditures in fiscal year 2012 were for care provided in CLCs. In addition, per diem expenditures in CLCs—i.e., the average daily cost per resident—were significantly higher than the per diem expenditures in community nursing homes and state veterans’ nursing homes. Over half of VA’s nursing home spending was for discretionary care and nearly half of spending was for veterans age 65 to 84. However, spending by eligibility status and age cohort varied by VA nursing home setting. In fiscal year 2012, VA spent more for care provided in CLCs than in the other two settings combined. Seventy-one percent ($3.5 billion) of VA’s total expenditures was spent on care provided in CLCs (see fig. 5), although CLCs accounted for 28 percent of the total workload. Conversely, VA spent 16 percent (about $800 million) for nursing home care in state veterans’ nursing homes, although state veterans’ nursing homes accounted for 53 percent of VA’s nursing home workload. The share of VA expenditures in each setting and other expenditure patterns we examine below remained relatively unchanged between fiscal years 2010-2012. Similar to workload, the proportion of VA nursing home expenditures accounted for by each setting varied widely by network. For example, nearly 90 percent of VA’s expenditures in VISN 5 (VA Capitol Health Care Network) were for care provided in CLCs, whereas in VISN 19 (Rocky Mountain Network) just 48 percent of expenditures were for care provided in CLCs. (See app. V for more information on nursing home expenditures by network and setting.) In addition to CLCs accounting for most of VA’s total nursing home expenditures, the per diem expenditure in CLCs was considerably higher than that for community nursing homes and state veterans’ nursing homes, as also reported in VA’s annual budget justification. Specifically, while the per diem expenditure across all settings in fiscal year 2012 was $370, the per diem expenditure in CLCs was nearly 4 times higher than for community nursing homes, and about 8 times higher than for state veterans’ nursing homes—$953 compared to $244 and $113, respectively. (See table 2.) We also found that the per diem expenditure for CLCs was substantially higher than the per diem expenditure for community nursing homes and state veterans’ nursing homes, regardless of the resident’s length of stay. Although the short-stay per diem expenditure in CLCs ($1,167) was substantially more than the per diem expenditure for long stays ($884), both were considerably higher than the per diem expenditures for community nursing homes and state veterans’ nursing homes. VA officials told us that they have not done any studies comparing the reasons for differences in per diem expenditures across settings because such expenditures are not comparable. However, VA officials provided us with a breakdown of the various components of total and per diem expenditures in CLCs. (See table 3.) VA officials indicated that “core” CLC expenditures, which account for about 40 percent of total CLC per diem expenditures, would be comparable to the care that VA pays for in community nursing homes and state veterans’ nursing homes. In addition to these core expenditures, VA’s expenditures for CLCs in fiscal year 2012 included direct care expenditures for physicians and other medical personnel staffing, indirect care expenditures for education and research, and overhead expenditures related to VA national programs, among others. In particular, VA officials noted that CLCs are often located in or within close proximity to a VA medical center, and that the facility expenditures alone for CLCs are generally higher than those of community nursing homes and state veterans’ nursing homes, which are generally stand-alone facilities. In fiscal year 2012, for example, the per diem expenditure for CLC facility costs alone was $234, roughly comparable to the entire per diem that VA paid for veterans to receive care in community nursing homes that year. VA officials also told us that while the amount of nursing staff in community nursing homes is similar to that of CLCs, the skill level may not be as high. For example, CLCs may hire more licensed and registered nurses due to the needs of the residents in CLCs. VA officials also told us that expenditures for emergency medical care would not be included in the community nursing home per diem expenditures, but that these expenditures are included for CLC residents. In addition, while the cost of routine medications is covered under the community nursing home per diem, any high-cost medications are not, although they are accounted for in the overall expenditures for operating the community nursing home program. Officials also noted that per diem expenditures for state veterans’ nursing homes only represent a portion of the total expenditures for care, with the remainder being paid for by the state and the veteran. The majority of VA’s spending for nursing home care in fiscal year 2012— $3.7 billion, or 75 percent—was on long-stay care. Long-stay care accounted for most of VA’s expenditures in each nursing home setting, and accounted for all but a small percentage of spending in state veterans’ nursing homes. (See fig. 6.) Although VA officials said they examine data on nursing home spending by length of stay for planning and budgeting purposes, VA does not include such data in its budget justification. Similarly, at the network level, the majority of expenditures for all networks were for long-stay care. The proportion of expenditures for long- stay care ranged from 62 percent for VISN 18 (VA Southwest Health Care Network) to 90 percent for VISN 3 (VA New York/New Jersey Veterans Healthcare Network). (See app. VI for information on expenditures by network and length of stay.) Overall, discretionary care accounted for just over half (52 percent or $2.5 billion) of all VA nursing home spending—a slightly lower proportion than workload, of which discretionary care comprised 62 percent. Just under half (47 percent or $2.3 billion) was spent on care for residents age 65 to 84. About one-quarter was spent on residents under age 65 and about the same percent for residents age 85 and over. (See fig. 7.) At the network level, total expenditures by eligibility status varied by network, with the proportion of spending for discretionary care ranging from 37 percent in VISN 6 (VA Mid-Atlantic Health Care Network) to 61 percent in VISN 15 (VA Heartland Network) and VISN 23 (VA Midwest Health Care Network). (See app. VII for information on expenditures by network and eligibility status.) Spending by age group did not vary as substantially between networks, however. Specifically, the proportion of spending for residents 65 through 84 ranged from 45 percent in VISN 1 (VA New England Healthcare System), VISN 15 (VA Heartland Network), and VISN 19 (Rocky Mountain Network), to 51 percent in VISN 6 (VA Mid-Atlantic Health Care Network). (See app. VIII for information on expenditures by network and resident age.) Similar to workload, spending for discretionary care varied widely by setting, with state veterans’ nursing homes having the highest proportion of their total spending (84 percent) for discretionary care compared to the other two settings (50 percent in CLCs and 18 percent in community nursing homes). (See table 4.) Also, state veterans’ nursing homes had the highest proportion (46 percent) of their total spending for residents age 85 and older, and the lowest proportion (8 percent) on residents under age 65. CLCs and community nursing homes had similar proportions of their total spending on care for residents in each age group. Similar to workload data, VA program officials told us that they rely on expenditure data by length of stay and resident characteristics for planning and budgeting purposes. This type of analysis is important given the significant differences in short- and long-stay per diem expenditures, particularly for CLCs, as well as differences in per diems that VA pays for mandatory and discretionary veterans in state veterans’ nursing homes. In addition, according to officials, expenditure data on community nursing homes are especially important from a program perspective since VA looks at unit costs to help in rate negotiations. However, VA does not currently include expenditure data disaggregated by length of stay and resident characteristics in its budget justification, and therefore does not provide information on unit costs to the maximum extent possible as encouraged by OMB to justify staffing and other requirements. As a result, congressional stakeholders have incomplete information on the budget that is approved for VA nursing home care, including the proportion of expenditures that is allocated for long-stay and short-stay care, as well as expenditures by resident characteristics. The lack of such information could hinder congressional budgeting and program oversight regarding VA’s staffing and resource requirements for providing nursing home care. VA now has key data on workload and expenditures for its three nursing home settings that were lacking in the past, and VA officials told us that they use these data for budgeting and planning purposes. Our analysis of these data show that the nursing home care that VA provides or pays for is primarily for long-stay care of 90 days or more for residents with chronic physical and mental limitations across all three nursing home settings, rather than short-stay care for residents with postacute care needs. Most of VA’s nursing home workload is for discretionary care, rather than mandatory care, and more care is provided for residents 65 to 84 years of age than for other age groups, though these patterns vary by setting. As VA determines budget estimates and plans for future care needs, these data provide a foundation for understanding the type of care provided, the characteristics of the residents receiving it, and differences among the three settings. We believe that having and using the key workload and expenditure data that we analyzed in this report provides VA with more complete data to better inform its budget estimates and conduct program oversight than in the past. VA is to be commended for collecting and using the information to improve its decision making. However, VA only includes data on total nursing home workload, total expenditures, and per diem expenditures by the three nursing home settings in its budget justification and does not include workload or expenditures disaggregated by length of stay or resident characteristics to the maximum extent possible to justify staffing and other requirements. As a result, Congress does not have complete nursing home data on workload and expenditures by the three settings. The lack of such information could hinder congressional decision making and oversight of budgeting of VA nursing home care staffing and resource needs for care, which accounts for a significant portion of VA’s health care budget and serves a vulnerable population. To provide more complete data for Congress, we recommend that the Secretary of Veterans Affairs supplement nursing home workload and expenditure data currently included in VA’s budget justification with the following information: Average daily census by length of stay and resident characteristics, including veterans’ eligibility status and age. Total expenditures and per diem expenditures by length of stay and resident characteristics, including veterans’ eligibility status and age. We provided a draft of this report to VA for comment. In its written comments—reproduced in appendix IX—VA concurred with our recommendation and stated that it will provide supplemental data on both nursing home workload and expenditures by length of stay and resident characteristics upon release of its fiscal year 2015 budget. VA stated that it would provide data for state veterans’ nursing homes to the extent the data are available. We are sending copies of this report to the Secretary of Veterans Affairs, and appropriate congressional committees. In addition, the report will be available at no charge on the GAO website at http://www.gao.gov. If you or your staff have any questions about this report, please contact Vijay D’Souza at (202) 512-7114, or dsouzav@gao.gov. Contact points for our Offices of Congressional Relations and Public Affairs are on the last page of this report. GAO staff who made major contributions to this report are listed in appendix X. In addition to the contact named above, James C. Musselwhite, Assistant Director; Iola D’Souza; Linda Galib; Drew Long; and Hemi Tewarson made key contributions to this report. Veterans’ Health Care Budget: Improvements Made, but Additional Actions Needed to Address Problems Related to Estimates Supporting President’s Request, GAO-13-715 (Washington, D.C.: Aug. 8, 2013). Veterans’ Health Care: Improvements Needed to Ensure That Budget Estimates Are Reliable and That Spending for Facility Maintenance Is Consistent with Priorities, GAO-13-220 (Washington, D.C.: Feb. 22, 2013). Veterans’ Health Care Budget: Better Labeling of Services and More Detailed Information Could Improve the Congressional Budget Justification, GAO-12-908 (Washington, D.C.: Sept. 18, 2012). Veterans’ Health Care Budget Estimate: Changes Were Made in Developing the President’s Budget Request for Fiscal Years 2012 and 2013, GAO-11-622 (Washington, D.C.: Jun. 14, 2011). Veterans’ Health Care: VA Uses a Projection Model to Develop Most of Its Health Care Budget Estimate to Inform the President’s Budget Request, GAO-11-205 (Washington, D.C.: Jan. 31, 2011). VA Health Care: Long-Term Care Strategic Planning and Budgeting Need Improvement, GAO-09-145 (Washington, D.C.: Jan. 23, 2009). 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.: Jan. 9, 2006). VA Long-Term Care: Oversight of Nursing Home Program Impeded by Data Gaps, GAO-05-65 (Washington, D.C.: Nov. 10, 2004).

Summary: In fiscal year 2012, about $4.9 billion of VAs $54 billion health care services budget was spent on nursing home care. To inform Congress of its budgeting priorities, VA prepares a budget justification, which is reviewed by OMB, that includes data on nursing home workload and expenditures in the three settings. VA also collects data on length of stay (long- and short-stay) and resident characteristics, including eligibility status, as VA is required to pay for mandatory veterans nursing home care and may pay for discretionary care as resources permit. These data are important for Congress to understand how funding is allocated for long- and short-stay care and for residents in each setting. GAO was asked to examine VAs nursing home program. Among other things, GAO examined (1) VAs nursing home workload in each setting, by length of stay and resident characteristics; and (2) VAs expenditures for nursing home care in each setting, by length of stay and resident characteristics. GAO analyzed VA nursing home workload and expenditure data, including fiscal year 2012, by setting, length of stay, and resident characteristics; and interviewed VA officials. In fiscal year 2012, the Department of Veterans Affairs' (VA) nursing home workload--the average number of veterans receiving nursing home care per day--was 36,250 across all of the three nursing home settings in which VA provided or paid for veterans' nursing home care. The three settings include Community Living Centers (CLCs), which are VA-owned and operated; community nursing homes with which VA contracts to provide care for veterans; and state veterans' nursing homes, which are owned and operated by states. Over half (53 percent) of this workload was provided in state veterans' nursing homes, 28 percent in CLCs, and 19 percent in community nursing homes. Nearly 90 percent of total workload was long-stay (91 days or more for residents with chronic conditions), and at least 75 percent of care provided in each of VA's three settings was long-stay. In addition, 62 percent of VA's total workload was provided to discretionary veterans (those veterans without certain levels of service-connected disabilities). In fiscal year 2012, VA spent $3.5 billion (71 percent) of its total nursing home expenditures on care provided in CLCs, 16 percent in state veterans' nursing homes and 13 percent in community nursing homes. Seventy-five percent of total spending was for long-stay care, and at least 70 percent of spending in each setting was for long-stay care. About half of total VA spending was for discretionary veterans. GAO found that VA does not provide nursing home workload and expenditure data by length of stay and resident characteristics in its budget justification, although the Office of Management and Budget (OMB) encourages agencies to provide such information to the maximum extent possible to justify staffing and other requirements and improve congressional decision making. As a result, VA does not provide complete information, which could hinder Congress' budgeting and oversight of VA's nursing home staffing and resource requirements. To enhance congressional oversight of VA's nursing home program, GAO recommends that VA supplement data currently included in its budget justification with workload and expenditures by length of stay and resident characteristics. VA concurred with GAO's recommendation and stated it will provide these data upon release of its fiscal year 2015 budget.