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Witness Testimony of Kelley J. Kash, Maine Veterans’ Homes, Augusta, ME, Chief Executive Officer

Mr. Chairman and Members of the Committee, thank you for the opportunity to testify today on behalf of the Maine Veterans’ Homes (“MVH”) on the topic of “Women, Rural, and Special Needs Veterans,” including the extremely important issue of continued access by veterans to quality long-term nursing care. 

I am the Chief Executive Officer of MVH.  MVH is a public body corporate created by the State of Maine to provide long-term nursing care to Maine veterans.  MVH operates long-term nursing care facilities for veterans at Augusta, Bangor, Caribou, Scarborough, South Paris, and Machias, Maine.  In the aggregate, MVH currently operates 640 skilled nursing, long-term nursing, and domiciliary beds for Maine veterans.  We are very proud of the quality long-term care nursing services that we provide to Maine veterans. 

Also, as one of the most successful State Veterans Homes systems in the nation, MVH provides a crucial portion of the health care continuum for Maine veterans.  Our facilities are each relatively small in size, 30 to 150 beds each, and this allows them to be located throughout the State of Maine, allowing greater ease of access to our facilities by veterans living in the most rural parts of Maine.  In the future, we hope to develop additional in-patient and out-patient services at all of our six locations in order to offer rural Maine veterans greater access to all of the services that the Maine Veterans’ Homes, the Maine Bureau of Veterans Services, and the United States Department of Veterans Affairs (“VA”) provide.

MVH is part of a vital national system of State Veterans Homes. The State Veterans Homes system is the largest provider of long-term care to our nation’s veterans.  As such, the State Veterans Homes play an irreplaceable role in assuring that eligible veterans receive the benefits, services, and quality long-term health care that they have rightfully earned by their service and sacrifice to our country.  We greatly appreciate this Committee’s commitment to the long-term care needs of veterans, your understanding of the indispensable function that State Veterans Homes perform, and your strong support for our programs.

We especially appreciate the past support of this Committee in providing funding to assure per diem payments by the Department of Veterans Affairs (“VA”) to veterans who are residents in our State Homes.  Adequate funding is absolutely key to providing top quality long-term care and access at affordable costs for our veterans.  In addition, we greatly appreciate your efforts to provide more funding for VA construction grants to provide new, expanded, and more capable long-term care services and facilities to veterans.

The Maine Veterans’ Homes is a leader in this national system of State Veterans Homes and a leader in the National Association of State Veterans Homes (“NASVH”).  The membership of NASVH consists of the administrators and staff of State-operated veterans homes throughout the United States.  NASVH members currently operate 132 veterans homes in 49 States and the Commonwealth of Puerto Rico.  These homes provide over28,000 nursing home and domiciliary beds for veterans and their dependents.  These beds represent about 52 percent of the long-term care workload for the VA, while consuming just 12 percent of the VA’s long-term care budget.

We work closely with the VA, State governments, the National Association of State Directors of Veterans Affairs, veterans service organizations, and other entities dedicated to the long-term care of our veterans.  Our goal is to ensure that the level of care and services provided by State Veterans Homes meet or exceed the highest standards available.

Role of the State Veterans Homes

State Veterans Homes first began serving veterans after the Civil War.  Faced with a large number of soldiers and sailors in critical need of long-term care, several States established veterans homes to care for those who served in the military.

In 1888, Congress first authorized federal grants-in-aid to states that maintained homes in which American soldiers and sailors received long-term care.  At the time, the payments amounted to about 30 cents per resident per day.  In the years since, Congress has made several major revisions to the State Veterans Homes program to expand the base of payments to include nursing home, domiciliary, and adult day health care.

For nearly half a century, State Veterans Homes have operated under a program administered by the VA which supports the Homes through construction grants and per diem payments.  Both the VA construction grants and the VA per diem payments are essential components of this support.  Each State Veterans Home must meet stringent VA-prescribed standards of care, which exceed standards mandated by federal and state governments for other long-term care facilities.  The VA conducts annual inspections to assure that these standards are met and to assure the proper disbursement of funds.  Together, the VA and the State Homes represent a very effective and financially efficient federal-state partnership in the service of our veterans.

VA per diem payments to State Homes are authorized by 38 U.S.C. § 1741–1743.  Congress intended to assist the States in providing for the higher level of care and treatment required for eligible veterans residing in State Veterans Homes.  As you know, the per diem rates are established by the VA annually and may not exceed 50% of the cost of care.  They are currently $71.42 per day for nursing home care, $64.13 per day for adult day health care, and $33.01 per day for domiciliary care.  Our State Veterans Homes cannot operate without the per diem payments from the VA.

Construction grants are authorized by 38 U.S.C. §§ 8131–8137.  The objective of such grants is to assist the States in constructing or acquiring State Veterans Home facilities.  Construction grants are also utilized to renovate existing facilities and to assure continuing compliance with life safety and building codes.  Construction grants made by the VA may not exceed 65 percent of the estimated cost of construction or renovation of facilities, including the provision of initial equipment for any project.  State funding covers at least 35 percent of the cost.  Our program cannot meet our veterans’ needs without an adequate level of construction grant funding.

In recent years, State Veterans Homes have experienced a period of controlled growth – the result of increasing numbers of elderly veterans who have reached that point in life when long-term care is needed.  In fact, we face the largest aging veterans population in our nation’s history.  From 2000 to 2010, the number of veterans aged 85 and older is expected to triple from 422,000 to 1.3 million.  If the State Veterans Homes program is to fill even a part of this unmet need for long-term care beds in certain States, and to respond to the increase in the number of veterans eligible for such care nationally, it is critical that the State Veterans Home construction grant program be sustained.

Traditionally, State Veterans Homes residents have been primarily male, as the VA per diem and construction grant requirements mandate that at least 75% of residents at any time be veterans.  However, more and more women veterans are being admitted to State Veterans Homes as veterans themselves, reflecting the large and increasing numbers of women who have served in the military since the Korean war. 

While our experiences in the Gulf War and present conflicts have given tremendous attention to post traumatic stress disorder (“PTSD”), the reality and effects of PTSD have been present in every conflict.  While State Veterans Homes provide a common culture, reassuring surrounding, appreciation, and understanding of the veterans’ experiences and issues, more can be learned and provided in treating PTSD in general. 

The State Veterans Home program now provides about 52% of the VA’s total long-term care workload.  The VA recently estimated nationally that nursing care beds in the State Homes are 87% occupied.  MVH beds are approximately 97% occupied.  Many of the State Veterans Homes nationally have occupancy rates near 100%, and some have long waiting lists.  The State Veterans Homes provide long-term medical services to frail, elderly veterans at a cost to the VA of only $71 per day, well below the cost of care in a VA nursing home, which exceeds $560 per day.

Although there are no national admission requirements for the State Veterans Homes, there are state-by-state medical requirements for admission.  Generally, a State will demand a medical certification confirming significant deficits in activities of daily living (an assessment of basic living functions) that require 24-hour nursing care.  Moreover, no per diem is paid by the VA unless and until a VA official certifies that nursing home care is required.  Veterans qualifying for long-term nursing care at a State Veterans Home are almost always chronically ill and elderly, and many are afflicted with mental health conditions.

State Veterans Homes as a VA Resource

The State Veterans Homes should play a major role in meeting these requirements and be treated as a resource integrated more fully with the VA long-term care program.  We have proposed that our beds be counted toward the VA’s overall long-term care census.  Doing so would allow the VA to meet its long-term care bed requirements.  A nursing home bed in a State Veterans Home is a very cost-effective alternative to a nursing home bed in a VA-operated facility.  Congress’s goal should be to provide long-term care to veterans in a manner that expands the VA’s capacity to provide services, while paying the lowest available per capita cost for each eligible veteran.  Including State Veterans Homes nursing beds in the mandated VA long-term care totals could allow the VA to meet its legislative mandate, shift some of its maintenance care and other specialty services to the State Veterans Homes, and ultimately increase the capacity of the VA to provide greater short-stay, highly-specialized rehabilitative care.

This goal can be accomplished by the State Homes at substantially less cost to taxpayers than other alternatives.  The average daily cost of care for a veteran at a long-term care facility run directly by the VA has been calculated nationally to be $563.45 per day.  The cost of care is $225.30 per day to the VA for the placement of a veteran at a contract nursing home, which is not required to meet more stringent State Veterans Home standards.  The same daily cost to the VA to provide outstanding quality long-term care at a State Veterans Home is far less – only $71.42 per day for nursing care.

This substantially lower daily cost to the VA of the State Veterans Homes compared to other available long-term care alternatives led the VA Office of Inspector General to conclude in a 1999 report: “the SVH [State Veterans Home] program provides an economical alternative to Contract Nursing Home (CNH) placements, and VAMC [VA Medical Center] Nursing Home Care Unit (NHCU) care” (emphasis added).  In this same report, the VA Office of Inspector General went on to say:

A growing portion of the aging and infirm veteran population requires domiciliary and nursing home care. The SVH [State Veterans Home] option has become increasingly necessary in the era of VAMC [VA Medical Center] downsizing and the increasing need to discharge long-term care patients to community based facilities. VA’s contribution to SVH per diem rates, which does not exceed 50 percent of the cost to treat patients, is significantly less than the cost of care in VA and community facilities.

In another example of how the VA can partner with State Veterans Homes, the State of Maine enacted legislation earlier this month to establish a veterans’ campus at Bangor, Maine.  The concept is to create a one-stop shop for veterans to receive most of their health care and social services needs.  The proposed project will locate a new, larger, and more capable VA community-based outpatient clinic next to the MVH Bangor facility.  Other veteran service organizations will be colocated at the campus, bringing a wide range of veteran services to a single campus and making it more efficient and convenient for veterans, families, the State Bureau of Veterans Affairs, VA, and various agencies and veterans service organizations that serve veterans’ health care and social service needs.  The Bangor Veterans Campus is a pioneering effort and the first of its kind in the nation.  Its success should be replicated throughout the nation

Status of VA Regulations

In our opinion, the VA chronically has been slow to implement enacted legislation.  Section 211 of Pub. L. No. 109-461 authorized the VA to directly place and pay the full cost of care for veterans with service-connected disabilities rated 70 percent or greater, or for veterans who need nursing home care as a result of their service-connected disabilities.  The same legislation authorized the VA to provide veterans with service-connected disabilities rated 50 percent or greater with prescription medications while residing in State Homes.  Federal law required these provisions to take effect by March 22, 2007, yet we are still waiting for the VA regulations with no forecasted date of implementation.  The result has been tremendous confusion and frustration for the many thousands of veterans who are waiting for these services, and for the State Veterans Homes, which will be required eventually to provide these services.

Section 201 of Pub. L. No. 108-422 authorized the VA to pay up to 50 percent of the cost for State Veterans Homes to implement an employee incentive scholarship to recruit and retain nurses.  While the VA announced that its regulations and implementation instructions will be completed this summer, Federal law required the VA to begin making payments to States no later than June 1, 2005 – three years ago!

VA Construction Grant Program

Under current law, there are strict limits and standards for funding the construction and renovation of State Veterans Homes.  The system is working very well under the provisions of the Millennium Bill, which establishes priorities for funding according to life/safety, great need, significant need, and limited need.

Moreover, under the requirements of the Millennium Bill, the VA prescribes strict limits on the maximum number of State Veterans Home nursing beds that may be funded by construction grants.  This is based on projected demand for the year 2009, which determines which states have the greatest need for additional beds.  This process assures that additional State Veterans Home beds are built only in those states that have the greatest unmet need for such beds.

However, the Administration has proposed cutting State Veteran Home construction matching-grant funding by almost 50 percent, from $165 million in FY 2008 down to $85 million for FY 2009.  The backlog of construction projects to repair, rehabilitate, expand, and build new State Veterans Homes is now approaching $1 billion.  Over $200 million of this backlog are life-safety projects.  These are critical and immediate needs.  Moreover, habitually under funding these projects puts the State Veterans Homes and their veteran residents at risk.    

Conclusion

Thank you for your commitment to long-term care for veterans and for your support of the State Veterans Homes as a central component of that care.  In conclusion, I will reiterate the key issues facing the State Veterans Homes.

First, thank you for your continued support of the VA per diem payment to the State Veterans Homes.  The loss or reduction of the VA per diem would place Homes in an untenable financial position and could lead to the closure of many State Homes, ultimately impacting our aging veterans severely.  

Second, we believe Congress must increase funding for construction grants to State Veterans Homes to at least $200 million to address the growing backlog of projects.  Inadequate or delayed funding will continue to grow the nearly $1 billion backlog that now exists, including over $200 million in life-safety projects.

Third, we believe Congress must require the VA to promulgate long-overdue regulations to strengthen State Veterans Homes and the veterans they serve.  In particular, increased payment for nursing home care and the provision of prescription medication in State Veterans Homes for veterans with service-connected disabilities of 70 percent or greater and 50 percent or greater, respectively, have been delayed indefinitely by the VA.  

Fourth, we believe that the State Veterans Homes can play a more substantial role in meeting the long-term care needs of veterans.  NASVH recognizes and supports the national trend towards deinstitutionalization and the provision of long-term care in the most independent and cost-effective setting.  In a letter to VA Secretary Nicholson dated April 5, 2005, NASVH proposed that we explore together creative ways to provide a true continuum of care to our veterans, both rural and urban, in State Veterans Homes and in the community.  We would be pleased to work with the Committee and the VA to explore options for developing pilot programs, such as the proposed Bangor Veterans Campus, for providing innovative care and for more closely integrating the State Veterans Homes program into the VA’s overall health care system for veterans.