More significantly, the number of veterans aged 75 and older, the heaviest users of nursing home care, is increasing rapidly. All veterans with a medical need for nursing home care are eligible to receive such care in VA nursing homes and community nursing homes under contract to VA. VA also pays a portion of the cost of care for veterans served in state veterans nursing homes. Overall, VA reports that nursing home obligations have grown from about $710 million in 1985, serving 72,889 veterans, to $1.6 billion in 1995, serving 79,373 veterans as shown in table 1. Patient Distribution in Types of Nursing Homes Has Shifted

The distribution of veterans in the three types of nursing homes differs greatly from VA’s target of 30 percent in VA homes, 40 percent in community homes, and 30 percent in state homes. According to VA-reported costs for fiscal year 1995, VA’s daily patient cost was $213.17 for veterans in VA nursing homes, $118.12 for veterans in community nursing homes, and $35.37 for veterans in state veterans homes (where only a portion of costs are funded by VA). Several Factors Affect VA’s Use of Community and State Nursing Homes

VA’s use of community nursing home beds is affected by (1) a shortage of beds in some parts of the country, (2) veteran and family preferences to use VA nursing homes, and (3) VA’s inability to compete with other purchasers of community nursing home services in some locations because of lower reimbursement rates. On the other hand, VA’s use of state veterans nursing homes is limited because of the number of such beds available and because VA has little control over who gets admitted to these facilities. To make informed nursing home resource management decisions, VA needs reliable demand and capacity data. On the basis of our review of selected quality indicators, the homes we visited appeared to provide comprehensive and appropriate care to veterans. VA Homes Had Fewer Quality-of-Care Issues Than Other Types of Homes

We visited 2 VA, 10 community, and 5 state veterans nursing homes, where we reviewed the care provided to 95 veterans. The patients were randomly selected for a representative sample at the VA and state veterans homes. Care provided in the state homes we visited generally met quality standards. However, without (1) accurate and complete information on nursing home costs, (2) better information on the availability of community nursing home beds, and (3) information on the competitiveness of VA reimbursement rates, VA has inadequate assurance that it is using the nursing home resources at its disposal to the best of its ability to serve veterans in need of such care.
Why GAO Did This Study

Pursuant to a congressional request, GAO provided information on the Department of Veterans Affairs' (VA) nursing home programs, focusing on: (1) the distribution of veterans in VA, community, and state veterans nursing homes; (2) the costs to VA for VA, community, and state veterans nursing homes; (3) the factors affecting VA's use of community and state veterans nursing homes; and (4) whether VA, community, and state veterans homes provide comparable quality care.

What GAO Found

GAO found that: (1) the number of veterans receiving VA-financed or -provided nursing home care increased from 72,889 in 1985 to 79,373 in 1995, though the costs of these services increased from about $710 million to $1.6 billion in the same period; (2) among veterans currently receiving VA-financed or -provided nursing home care, 40 percent receive such care in VA nursing homes, 36 percent in state veterans nursing homes, and 24 percent in community nursing homes; (3) VA records for fiscal year 1995 indicate that VA's daily per patient cost was $213.17 for veterans in VA nursing homes, $118.12 for veterans in community nursing homes, and $35.37 for veterans in state veterans homes; (4) some of the cost differences are attributable to differing patient mix and staffing patterns among the facility types, but the precise cost differences cannot be determined because of weaknesses in VA's cost data; (5) several factors influence VA decisions on where to place nursing home patients; (6) VA's use of state veterans homes is limited by the number of such beds available and by some states' criteria for admitting veterans to these homes; (7) the VA nursing homes GAO visited appeared to provide more comprehensive care to veterans than most of the community and state veterans nursing homes GAO visited; (8) although the care provided in the community and state homes GAO visited generally met quality standards, GAO identified quality-of-care issues at both types of homes; and (9) although VA has initiated efforts to improve its data on the cost of providing and purchasing nursing home care, the availability of nursing home beds in local markets, and the adequacy of VA reimbursement rates to purchase quality nursing home care for veterans, better information is still needed for VA to make informed resource management decisions.