Summary
In fiscal year 2007, the Department of Veterans Affairs (VA) spent about $4.1 billion on long-term care for veterans. VA provides--through VA or other providers--institutional care in nursing homes and noninstitutional care in veterans' homes or the community. In response to a statute, VA published in 2007 a long-term care strategic plan through fiscal year 2013. VA includes long-term care spending estimates in its annual budget justifications for Congress. These estimates are based on workload projections--the amount of care to be provided--and cost assumptions. VA has discretion in allocating appropriated funds among its medical services, such as long-term care. GAO examined (1) VA's reporting of planned workload in its 2007 long-term care strategic plan and (2) VA's long-term care spending estimates, including its cost assumptions and workload projections, in VA's fiscal year 2009 budget justification. GAO analyzed budget and planning documents and interviewed VA officials.
In its 2007 long-term care strategic plan, VA reported planned increases for some long-term care workload, but the workload information VA provided for both nursing home and noninstitutional care was incomplete. With respect to nursing home care, VA reported plans to increase workload for certain veterans for whom VA is required to provide such care. However, VA did not report its nursing home workload plans for most veterans VA currently serves--veterans who receive such care from VA on a discretionary basis and who accounted for over three-fourths of VA's nursing home workload in fiscal year 2007. Although not reported in its strategic plan, VA's intention is to keep its total nursing home workload stable. Doing so while increasing workload for veterans VA is required to serve would reduce care provided on a discretionary basis. For noninstitutional care, VA reported plans to increase workload to close gaps in services--previously identified by GAO--for enrolled veterans, for whom those services are to be available. But VA's plan did not report the magnitude of this planned increase--167 percent between fiscal years 2007 and 2013--or VA's time frame for achieving this planned increase. Currently, VA is developing its next long-term care strategic plan. In its fiscal year 2009 budget justification, VA estimated that it will increase its long-term care spending over its fiscal year 2008 level, but this estimate is based on cost assumptions and a workload projection that appear unrealistic. VA estimated that spending for both nursing home and noninstitutional care will increase in fiscal year 2009 by about $108 million and $165 million, respectively. However, VA may have underestimated its nursing home spending because it assumed nursing home costs would increase about 2.5 percent, an amount that appears unrealistically low compared to VA's recent experience and other indicators. For noninstitutional care, VA proposed a spending increase in order to partially reduce gaps in services. However, VA's estimated noninstitutional spending for fiscal year 2009 appears to be unreliable, because it is based on a cost assumption that appears unrealistically low and a workload projection that appears unrealistically high, given recent VA experience. The net effect of these two factors on VA's fiscal year 2009 noninstitutional spending estimate is unknown. VA's fiscal year 2009 budget justification did not explain the rationale behind its nursing home and noninstitutional cost assumptions or its plans for how it will increase noninstitutional workload. Because the workload information reported in VA's long-term care strategic plan is incomplete, the plan is of limited usefulness to Congress and stakeholders for determining VA's strategic direction, the extent to which VA's priorities are consistent with congressional priorities, and the level of resources VA may need to achieve its strategic plan goals. In addition, in its fiscal year 2009 budget justification, VA's use, without explanation, of cost assumptions and a workload projection that appear to be unrealistic raises questions about both the reliability of VA's spending estimates and the extent to which VA is closing gaps in noninstitutional long-term care services.
Recommendations
Our recommendations from this work are listed below with a Contact for more information. Status will change from "In process" to "Open," "Closed - implemented," or "Closed - not implemented" based on our follow up work.
Director:
Team:
Phone:
Randall B. Williamson
Government Accountability Office: Health Care
(206) 287-4860
Recommendations for Executive Action
Recommendation: To make available more complete information for congressional oversight and use by stakeholders regarding VA's plans for the provision of long-term care, the Secretary of Veterans Affairs should direct the Under Secretary for Health to include three types of workload information in VA's forthcoming long-term care strategic plan: (1) planned total nursing home workload, including care provided to veterans on a discretionary basis; (2) estimated demand for noninstitutional services and VA's time frame for meeting this demand; and (3) a comparison of planned noninstitutional workload with recent noninstitutional workload to show the magnitude of the expected change in services provided.
Agency Affected: Department of Veterans Affairs
Status: Open
Comments: The Department of Veterans Affairs (VA) stated that it will enhance its forthcoming long-term care strategic plan by including the three types of workload information we recommended: (1) planned total nursing home workload, including care provided to veterans on a discretionary basis; (2) estimated demand for noninstitutional services and VA's time frame for meeting this demand; and (3) a comparison of planned noninstitutional workload with recent noninstitutional workload to show the magnitude of the expected change in services provided.
Recommendation: To strengthen the credibility of VA's estimates of spending for its long-term care services budgeting proposals and increase transparency for Congress and stakeholders, the Secretary of Veterans Affairs should, in future budget justifications, use cost assumptions for estimating nursing home spending that are consistent with VA's recent experience or report the rationale for using cost assumptions that are not.
Agency Affected: Department of Veterans Affairs
Status: Closed - implemented
Comments: The Department of Veterans Affairs (VA) concurred with our recommendation. In its response to our recommendation, VA stated that the Veterans Health Administration Budget Office would, in future budget justifications, use cost assumptions consistent with VA's recent experience or report the rationale for using other assumptions. In its fiscal year 2010 budget justification, VA assumed nursing home cost would increase 10 percent--an amount that is in line with VA's recent experience.
Recommendation: To strengthen the credibility of VA's estimates of spending for its long-term care services budgeting proposals and increase transparency for Congress and stakeholders, the Secretary of Veterans Affairs should, in future budget justifications, use cost assumptions for estimating noninstitutional long-term care spending that are consistent with VA's recent experience or report the rationale for using cost assumptions that are not.
Agency Affected: Department of Veterans Affairs
Status: Closed - implemented
Comments: The Department of Veterans Affairs (VA) concurred with our recommendation. In its response to our recommendation, VA stated that the Veterans Health Administration Budget Office would, in future budget justifications, use cost assumptions consistent with VA's recent experience or report the rationale for using other assumptions. In its fiscal year 2010 budget justification, VA assumed noninstitutional long-term care costs would increase about 9.5 percent--an amount that is in line with VA's recent experience.
Recommendation: To strengthen the credibility of VA's estimates of spending for its long-term care services budgeting proposals and increase transparency for Congress and stakeholders, the Secretary of Veterans Affairs should, in future budget justifications, use workload projections for estimating noninstitutional long-term care spending that are consistent with VA's recent experience or report the rationale for using projections that are not.
Agency Affected: Department of Veterans Affairs
Status: Closed - implemented
Comments: The Department of Veterans Affairs (VA) concurred with our recommendation. In its response to our recommendation, VA stated that the Veterans Health Administration Budget Office would, in future budget justifications, use workload projections for estimating noninstitutional long-term care spending consistent with VA's recent experience or report the rationale for using other assumptions. In its fiscal year 2010 budget justification, VA assumed noninstitutional long-term care workload would increase 25 percent, an amount that is in line with VA's recent experience.
Recommendation: To strengthen the credibility of VA's estimates of spending for its long-term care services budgeting proposals and increase transparency for Congress and stakeholders, if VA uses different measures of workload for noninstitutional long-term care services for estimating spending, the Secretary of Veterans Affairs should, in future budget justifications, report which measures are used for each service and how these measures reflect the volume of services received by veterans.
Agency Affected: Department of Veterans Affairs
Status: Open
Comments: The Department of Veterans Affairs (VA) concurred with our recommendation. In its response to our recommendation, VA stated that the Veterans Health Administration Budget Office would, in future budget justifications, report which workload measures are used for each noninstitutional long-term care service and how these measures reflect the volume of services received by veterans. However, VA did not include this information in its fiscal year 2010 budget justification.
