Grassley, Leach and others asked the General Accounting Office to study the Veterans Equitable Resource Allocation (VERA) system last year. They expressed concern that the health network serving Iowa within the VERA system has experienced repeated budget shortfalls and today recommended that the Department of Veterans Affairs make changes recommended by the GAO.
"I appreciate the GAO's work in finding these significant deficiencies in the health care system for veterans," Grassley said. "The VA needs to implement the kinds of changes suggested in this report. I intend to work closely with agency officials to try and get this done before the next fiscal year, and I'll also seek support from the veterans committees in the Senate and House to see the necessary changes made."
"Under increasingly strained circumstances, Iowa veterans have received the highest quality health care possible from the VA providers in our state. Action should be taken immediately to correct the inequities uncovered by this study in order to ensure that the VA facilities in Iowa have the resources needed to continue to provide the level and quality of care veterans have earned," Leach said.
The GAO, which is the investigative arm of Congress, found specific weaknesses with how the VERA system was implemented, including the following.
- The VERA system excludes from the calculation of health-network workloads veterans categorized as Priority 7. These are higher-income veterans without service-connected disabilities and, as a result, funds are not provided to the 22 health networks in the VERA system to treat these veterans. However, Priority 7 veterans constitute about one-fifth of all the veterans cared for by the federal government, so the per patient allocation is distorted by their numbers. What's more, network 14, which serves Iowa, treats approximately 32 percent more of these veterans than the national average for all networks. The GAO found in its latest analysis that if the networks received an allocation for Priority 7 veterans at just half their national average cost, then Iowa's network would have received an additional $1,021,387 during fiscal 2001.
- The VERA system cannot accurately allocate comparable resources to comparable workloads across its 22 networks for two reasons. The first is that it doesn't sufficiently distinguish among the levels of care needed by patients. It would need to use more categories than the three it does now to better match resources to patient needs. The GAO said that if the VERA system used the same 44 categories that the GAO used in its analysis, then Iowa's network would have received an additional $3,176,377 in fiscal 2001. The second reason is that the VA has not updated the data on which the VERA allocation is based since 1995, even though the VA health care system has changed substantially. The GAO said that if the data was more current, then resources could be allocated in a way that better reflects the kinds of care currently being given in the VA.
- The GAO said the VA has not studied why certain networks had resource shortfalls and some in consecutive years, such as Iowa's, and instead focused on providing supplemental resources on a case-by-case basis. The result, according to GAO is that the VA is missing opportunities to better understand the limitations of the VERA system.
In its report delivered on February 28, the GAO recommended the following executive actions to improve the allocation of resources through the VERA system:
- Better alignment of VERA measures of workload with actual workload served regardless of veteran priority group.
- Incorporation of more categories into VERA's case-mix adjustment.
- An update of VERA's case-mix weights using the best available data on clinical appropriateness and efficiency.
- Determination in the supplemental funding process of the extent to which different factors cause networks to need supplemental resources and action to address limitations in VERA or other factors that may cause budget shortfalls.
- Establishment of a mechanism in the National Reserve Fund to partially offset the cost of networks' highest cost complex-care patients.
This GAO report is titled VA HEALTH CARE, Allocation Changes Would Better Align Resources with Workload. It can be seen at www.gao.gov. The document reference is GAO-02-338.