VA facilities also purchase health care from other public and private providers under certain conditions, such as medical emergencies. Not only has VA been able to meet the demands for hospital care through use of existing VA and community beds, but there is also significant excess hospital capacity in VA, DOD, and community facilities. Such an increase in market share appears unlikely because the veteran population in the service area is projected to decrease by about 25 percent between 1995 and 2010. However, network and NCHCS officials told us, and we observed during our visits, that these clinics operate inefficiently, in part, because of space constraints, such as the lack of sufficient numbers of examining rooms. The remaining 23 percent went to other VA hospitals, primarily Palo Alto and San Francisco. Existing Hospitals Have Hundreds of Unused Beds

Over 3,300 excess hospital beds exist in and near the areas that would be served by the proposed Travis project. As discussed above, community hospitals in the Fairfield area have occupancy rates of around 40 percent and those in the Sacramento area, about 68 percent. Veteran Population Near Travis May Not Be Large Enough to Support Proposed Clinic

The number of veterans traditionally targeted by VA—primarily veterans with low incomes or service-connected disabilities—living near the Travis Air Force Base does not appear to be large enough to support an outpatient clinic as large as the one planned. Because VA does not have an outpatient clinic at Travis and no physicians’ offices are available to VA, physicians’ options are limited. Opportunities Exist to Expand Use of Community Hospitals Close to Veterans’ Homes

Thousands of unused beds are available in community hospitals in northern California. In the approximately 4 years since VA’s decision to build a replacement hospital at Travis Air Force Base was made, significant changes in the availability of beds in community hospitals have occurred. In addition, the Sierra Pacific Network director has established a task team consisting of facility directors to study the best way to deliver care in the network. Conclusions

VA’s plans to establish a 243-bed medical center at Travis Air Force Base—which include construction of 170 new hospital beds, renovation and expansion of existing Air Force support areas, and construction of an 85,000-visit outpatient clinic—are not justified on the basis of the current and expected workload and the availability of lower-cost alternatives. First, VA is meeting veterans’ needs with existing facilities. NCHCS clinics in Sacramento, Oakland, and Martinez, while crowded and operating at less than full efficiency, are meeting inpatient and outpatient needs and turning away no veterans. VA has many more efficient alternatives to serve northern California veterans. Recommendation to the Congress

We recommend that the Congress deny VA’s request for funds to construct additional hospital beds at Travis Air Force Base, given the availability of cost-effective alternatives to meet the health care needs of veterans in the NCHCS.
Why GAO Did This Study

Pursuant to a congressional request, GAO provided information on the Department of Veterans Affairs' (VA) planned construction of an outpatient clinic and additional bed space at the David Grant Medical Center at Travis Air Force Base, focusing on whether: (1) the project could be adequately justified; and (2) there are cost-effective alternatives to planned hospital construction.

What GAO Found

GAO found that: (1) construction of additional hospital beds and an outpatient clinic as large as VA proposes at Travis Air Force Base is unnecessary; (2) significant changes have occurred in the health care marketplace and in the way VA delivers health care in the 4 years since the project was planned, but VA plans have not been revised accordingly; (3) these changes alone have resulted in over 3,300 unused hospital beds in northern California hospitals, including beds in VA, Air Force, and community hospitals; (4) in addition, the veteran population in the service area is expected to drop by about 25 percent between 1995 and 2010; (5) VA has not considered the likely negative effects the additional beds could have on other hospitals in northern California, particularly those community hospitals in the Solano County area surrounding Travis Air Force Base that have occupancy rates of around 40 percent; (6) data GAO obtained show that VA is currently meeting the health care needs of veterans served by the Northern California Health Care System; (7) with VA hospitals at Palo Alto, San Francisco, and Travis operating below capacity, VA clinics have no trouble placing patients needing hospital care; (8) also, while VA's four clinics in the area intended to be served by the Travis hospital are operating at close to full capacity, three have turned away no veterans needing hospital or outpatient care; (9) in addition, the clinics have effectively used community hospitals for medical emergencies; (10) VA officials pointed out, and GAO's visits confirmed, that space constraints, such as the lack of sufficient numbers of examining rooms, prevent them from operating as efficiently as they could otherwise; (11) GAO identified several more efficient alternatives that are available to VA if increased demand for hospital care should materialize; (12) VA officials in the Sierra Pacific Network are currently studying the best way to meet veterans' future health care needs; and (13) network officials are considering options to make better use of VA facilities and increase the use of private and other public facilities.