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U.S. Department of Veterans Affairs Grant and Per Diem Program.

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SEPTEMBER 27, 2007

SERIAL No. 110-48

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BOB FILNER, California, Chairman


VIC SNYDER, Arkansas
JOHN J. HALL, New York
PHIL HARE, Illinois
MICHAEL F. DOYLE, Pennsylvania
TIMOTHY J. WALZ, Minnesota

STEVE BUYER,  Indiana, Ranking
HENRY E. BROWN, JR., South Carolina
BRIAN P. BILBRAY, California




Malcom A. Shorter, Staff Director

MICHAEL H. MICHAUD, Maine, Chairman

VIC SNYDER, Arkansas
PHIL HARE, Illinois
MICHAEL F. DOYLE, Pennsylvania
JEFF MILLER, Florida, Ranking
HENRY E. BROWN, JR., South Carolina

Pursuant to clause 2(e)(4) of Rule XI of the Rules of the House, public hearing records of the Committee on Veterans' Affairs are also published in electronic form. The printed hearing record remains the official version. Because electronic submissions are used to prepare both printed and electronic versions of the hearing record, the process of converting between various electronic formats may introduce unintentional errors or omissions. Such occurrences are inherent in the current publication process and should diminish as the process is further refined.



September 27, 2007

U.S. Department of Veterans Affairs Grant and Per Diem Program


Chairman Michael Michaud
    Prepared statement of Chairman Michaud
Hon. Jeff Miller, Ranking Republican Member
    Prepared statement of Congressman Miller



U.S. Government Accountability Office, Daniel Bertoni, Director, Education, Workforce, and Income Security Issues
    Prepared statement of Mr. Bertoni
U.S. Department of Veterans Affairs:
George Basher, Chair, Advisory Committee on Homeless Veterans, and Director, New York State Division of Veterans' Affairs
    Prepared statement of Mr. Basher
Pete Dougherty, Director, Homeless Veterans Programs, Veterans Health Administration
    Prepared statement of Mr. Dougherty

National Coalition for Homeless Veterans, Cheryl Beversdorf, RN, MHS, MA, President and Chief Executive Officer
    Prepared statement of Ms. Beversdorf
Volunteers of America of Florida, Kathryn E. Spearman, President and Chief Executive Officer
    Prepared statement of Ms. Spearman


American Legion, Ronald F. Chamrin, Assistant Director, Economic Commission, statement


Post Hearing Questions and Responses for the Record:

Hon. Jeff Miller, Ranking Republican Member, Subcommittee on Health, Committee on Veterans' Affairs, to Hon. Gordon Mansfield, Acting Secretary, U.S. Department of Veterans Affairs, letter dated October 5, 2007


Thursday, September 27, 2007
U. S. House of Representatives,
Subcommittee on Health,
Committee on Veterans' Affairs,
Washington, DC.

The Subcommittee met, pursuant to notice, at 10:02 a.m., in Room 334, Cannon House Office Building, Hon. Michael Michaud [Chairman of the Subcommittee] presiding.

Present:  Representatives Michaud, Snyder, Salazar, and Miller.


Mr. MICHAUD.  The Subcommittee on Health will come to order.

I would like to thank everyone for coming today.  Today we will examine the U.S. Department of Veterans Affairs (VA) Grant and Per Diem (GPD) Program for homeless veterans.

On any given night, there are approximately 200,000 homeless veterans on the streets in America.  The majority of these veterans served in Vietnam.  Ninety-six percent are male and about 45 percent suffer from mental illness.

VA has many programs to help homeless veterans including the Grant and Per Diem Program.  VA needs to continually evaluate these programs to ensure that veterans are getting the services that they need and that provider organizations can effectively provide these services as well.

For example, while the vast majority of homeless veterans are male, female veterans are the fastest-growing segment in this population.  Women homeless veterans face similar challenges to their male counterparts, but they are very likely to have experienced serious trauma including abuse or rape and a significant number also have children to support.  VA programs must be flexible to meet this new challenge. 

I believe that the VA should make sure that they give community-based organizations the tools they need to provide comprehensive service to our homeless veterans.  The way in which the Grant and Per Diem Program is currently structured sometimes make this difficult, particularly for providers in high-cost areas.

It is my belief that the goal of the VA homeless program should be not only to provide veterans with a bed for the night and a meal, but to provide them with the resources they need to attain permanent housing and a steady job and a renewed sense of self-worth.

Today I hope that we will learn what VA is doing to provide service to homeless veterans to help them break out of this cycle.  We will hear from the Grant and Per Diem Program on what is working and the ways that it can be changed.  This is a problem that we can solve by working together.  One homeless veteran is too many. 

[The statement of Chairman Michaud appears in the Appendix.]

Mr. MICHAUD.  I would now like to recognize a colleague of mine who cares deeply about our veterans, Ranking Member Miller, for any opening statement he might have.


Mr. MILLER.  Thank you very much, Mr. Chairman.

This year marks the 20th anniversary of VA providing specialized services for homeless veterans.  VA's homeless program began in 1987 with Public Law 100-6, which provided VA with $5 million to support care for veterans in community-based and domiciliary facilities.

Since that time, VA's homeless programs have expanded and grown significantly.  VA currently budgets almost $2 billion to treat and assist homeless veterans, and administers over nine specialized programs that integrate housing and mental health and substance abuse counseling.

Although it remains difficult to obtain an accurate count of the number of homeless veterans, and I think most of us agree that 200,000 is a close number.  There are indications that we are making good progress in helping reintegrate homeless veterans into stable community environments and lead productive and sober lives.

Still, there are far too many veterans out on the street.  I concur with you, Mr. Chairman, that one homeless veteran on any given night is too much.  On any given night in my home State of Florida, there are 17,000 homeless veterans are on the streets. 

I think that with the increasing number of returning veterans from the conflicts in Iraq and Afghanistan, the development of innovative services to help veterans at-risk for homelessness is extremely important. 

Today, we meet to review VA's Homeless Providers Grant and Per Diem (GPD) Program.  This program is considered to be a very successful collaboration between VA, nonprofit, and faith-based organizations.  Our Committee has always worked in a bipartisan manner to strengthen healthcare, housing, employment training, and other services to assist at-risk veterans.  Mr. Chairman, I look forward to working with you to continue that relationship. 

I would like to welcome all of the witnesses that are here with us today, especially Kathryn Spearman who is with Volunteers of America Florida, for participating in our hearing this morning.  I am grateful for her dedication and many years of service and work to provide services that assist homeless veterans in our home State of Florida.

Mr. Chairman, I yield back the balance of my time.

[The statement of Congressman Miller appears in the Appendix.]

Mr. MICHAUD.  I thank the gentleman.

Our first panel today is Cheryl Beversdorf who is President and Chief Executive Officer (CEO) of the National Coalition for Homeless Veterans (NCHV).

Welcome, Cheryl.

And Kathryn Spearman who is President and CEO of Volunteers of America from Tampa, Florida.

I also want to welcome you, Kathryn.

And Daniel Bertoni who is Director of Education, Workforce and Income Security Issues from the U.S. Government Accountability Office (GAO).

I would like to welcome our panelists today and we will start off with Cheryl and just work down.

So I turn the floor over to you.



Ms. BEVERSDORF.  The National Coalition for Homeless Veterans appreciates the opportunity to submit testimony to the Health Subcommittee of the House Veterans' Affairs Committee regarding the VA Grant and Per Diem Program.

NCHV's membership represents nearly 280 community-based organizations in 48 States and the District of Columbia.  As a network, NCHV members provide the full continuum of care to homeless veterans and their families including emergency shelter, food and clothing, healthcare, addiction and mental health services, employment support, educational assistance, legal aid and transitional housing and other kinds of services.

NCHV members serve approximately 150,000 veterans annually.  Regarding homelessness among veterans, the VA reports homeless veterans are mostly males, although three percent are females, and the vast majority are single, although service providers are reporting an increased number of veterans with children seeking their assistance. 

About half of all homeless veterans have a mental illness and more than two-thirds suffer from alcohol or other substance abuse problems.  Nearly 40 percent have both psychiatric and substance abuse disorders.

In addition, the majority of women in homeless veteran programs have serious trauma histories, some life threatening, and many of these women have been raped and reported physical harassment while in the military.

Veterans are at high risk of homelessness due to three factors:  Extremely low or no livable income; extreme shortage of affordable housing; and limited access to healthcare.  These factors combined with circumstances experienced during their military service put them at even greater risk of homelessness.

Findings from a 2006 NCHV survey suggest the homeless veteran population in America is experiencing significant changes.  Homeless veterans receiving services today are aging and many need permanent supportive housing.  With more women in the military, the percentage of women veterans seeking services is increasing. 

In general, a growing number of combat veterans returning home from Iraq and Afghanistan, both men and women, are suffering from war-related conditions including post traumatic stress disorder (PTSD) and traumatic brain injury (TBI), which may put them at risk for homelessness.

The homeless providers Grant and Per Diem Program supports development of transitional community-based housing and delivery of supportive services for homeless veterans through competitive grants to community-based, faith-based, and public organizations.

To underline the importance of the Grant and Per Diem Program, in September 2006, the GAO released a study that found while VA has attempted to improve its services and increase the capacity of the Grant and Per Diem Program, an additional 9,600 transitional housing beds are still needed to meet current demand.

Regarding Grant and Per Diem appropriations, NCHV is pleased both the House and Senate have passed bills increasing the fiscal year 2008 appropriations to the fully authorized level of $130 million.  If approved, funding at this level will increase beds available to serve more men and women veterans at risk of homelessness.

In addition to the need for more beds and increased program funding, NCHV believes the mechanism for paying providers under the Grant and Per Diem Program must be modified.

Regarding payment, many Grant and Per Diem providers report even the maximum rate of up to $31.30 provides far less than the actual daily cost of care to a veteran in the Grant and Per Diem Program.

Providers often experience lengthy, ongoing communication with the VA and questions regarding expenses incurred and accountability resulting in a delay in timely reimbursement and ultimately, interruption of services to their clients.

The accounting burden is particularly onerous for smaller faith-based and community-based organizations that may lack the necessary resources to easily resolve these issues.

At the time the law creating the Grant and Per Diem Program, was written, Congress had limited knowledge as to how services to veterans outside VA facilities should be reimbursed.  As a result, the rate authorized for State homes for domiciliary care was used as the standard for paying homeless veterans' service providers.

Over time, evidence has shown clients in the two settings have very different needs.  Accordingly, a modified payment system that reflects the special needs of homeless veterans and the comprehensive services they receive must be applied.

Whereas residents receiving domiciliary care in State homes are more likely to remain permanently in VA facilities, the goal of community-based veteran service providers is to promote independent living for their clients and reintegration back into civilian life.

To address these issues, NCHV urges Congress to introduce legislation that would allow payments for services to be related to costs rather than a capped rate.

In addition to creating a more user-friendly system, this approach may increase service provider participation in high-cost service areas. 

A reasonable practice of outcome and performance measurement of Grant and Per Diem providers should be included under this system.

The requirements for grant recipients should also allow service providers to use other available sources of income besides the Grant and Per Diem Program including payments or grants from other Federal departments and agencies in addition to those of State or local governments.

While the current law was intended to ensure VA per diem payments do not replace payments or contributions from other income sources, it has instead created the unintended consequences of penalizing Grant and Per Diem providers successful in securing other sources of income for services to homeless veterans by reducing their per diem payment rate.

Congress should devise a payment provision that encourages Grant and Per Diem providers to seek funding from the non-VA sources in a manner that does not penalize them if they are successful. 

All payment modifications should also allow VA funds to be used as a match or leverage for other Federal funds and allow other Federal funds to be used without offset by VA.

When Grant and Per Diem providers are able to receive the maximum rate in addition to other income sources, they can expand the scope and quantity of services to homeless veterans and increase the likelihood of their successful reintegration into the community.

Additional income will help providers develop and support additional housing units, provide veterans a more robust service package, and serve homeless veterans not qualified for Grant and Per Diem support.

In conclusion, I want to thank you for inviting NCHV to present our views about the Grant and Per Diem Program.  We urge Congress to introduce and pass legislation that will address the concerns that we have presented today.

I will be happy to answer your questions.

[The statement of Ms. Beversdorf appears in the Appendix.]

Mr. MICHAUD.  Ms. Spearman?


Ms. SPEARMAN.  Chairman Michaud, Ranking Member Miller, and Members of the Subcommittee, thank you for the invitation to testify today and for all you do to assist our Nation's veterans.

I work for Volunteers of America of Florida, as stated earlier, which is a statewide faith-based social service organization in Florida for the past 87 years.  And we are an affiliate of the larger Volunteers of America, a national organization around for 111 years and with affiliates in 44 States.

Volunteers of America of Florida offers housing and services and we serve multiple and different types of populations including the homeless.  Our service continuum includes housing, healthcare, training, education, employment, and services that all enhance self-sufficiency.

We currently operate in 13 Florida cities and we are in development in three more cities.  And we do some consultation with some grass-roots groups that have a rural focus.

For my Florida Members, I would like to say, Representative Miller, we are developing Pensacola and we have some new things that are going to be going on there.  So we are happy with that. 

And I guess Representatives Brown and Stearns are not present right now, but we have some things in their area as well.

Florida attracts many homeless veterans and we have been focused on addressing the needs of these individuals for the past ten years.  We partner with the VA Grant and Per Diem Program in serving this population.

And as far as transitional housing and support services currently, we have a 216-bed capacity with 81 in development.  And most of those are from the Grant and Per Diem.  Also included are 45 U.S. Department of Housing and Urban Development (HUD) Supportive Housing Program transitional beds for veterans as well.

Our first Grant and Per Diem was a 40-foot state-of-the-art vehicle that is a fully-contained medical, dental, and health-service facility that does mobile outreach all over the State of Florida.  And that is still in operation.

I would also like to say that all of our beds are filled with veterans.  And I know we have the 25-percent rule, but we never had any, you know, reason to use that because the need is so great.

As far as the Grant and Per Diem Program, I would like to say some positive things that I really do appreciate as a provider. 

First of all, the dedication of Roger Casey and his staff to try to keep making this program what it needs to be, the continual funding that we have been receiving recently to add more beds, the grant segment, which provides tremendous leverage and incentive, the opportunity for the VA and the community to work together to help homeless veterans, the per diem that strengthens the operations and program, the potential for the service center, and also I very much see this as a gateway for veterans to become more a part of the community.

Our ten years of experience have led us to an increasing awareness of the issues facing the Grant and Per Diem Program and the providers.  And I want to spend the rest of my testimony mentioning some information I would like to share but also a few suggestions.

In relation to partnership, the overall partnership between the VA and the community needs strengthening.  Local providers address the needs of veterans every day and complement the VA's services.  We are good at what we do and we need the VA and the VA needs the community providers.  And the veteran needs us to work more closely together.

A partnership approach, I feel strongly does work, and with a good partnership comes shared risk because we both own the problem and work together to solve those problems.

A suggestion I would have today is a work group to advise and the task would be for a Grant and Per Diem payment mechanism that is provider friendly and also offers the accountability that the VA needs.  And the representation on that group would be all the members of the partnership.

Next—what it takes in helping homeless veterans.  I think there are eleven essential services and I have listed those in my written testimony, things that I think are essential to bringing a veteran back to being a part of the community.

I doubt most people know how disengaged and disabled many of the homeless veterans are when they come to our programs and drug and alcohol addiction is very serious and disruptive to rebuilding a life acceptable in our society.

Next I want to talk about cost.  The services, the eleven essential services go all the way from outreach to treatment and then integration back into the community.  But the cost, I just want to say that the service cost and the payment do not match up, the $32.00 a day.  And I have put some breakdowns in my written testimony to show actually what things do cost as an example.

And then the service center payment mechanism does not relate, just does not relate.  We need to change that.

And then the construction, rehab and acquisition require 30 percent cash and we need more flexibility with that.  There are many creative ways to combine development funding or put together the assets of providers, the VA grant and some financing.

I have proposed some options for payment possibilities in my written testimony based on experience.

I think the flexibility we need now in this program should also be with an eye to the future when we will be focused on a new era of veterans with a whole new set of circumstances and needs. 

Veterans now returning from Operation Iraqi Freedom (OIF) or Operation Enduring Freedom (OEF) should benefit from the lessons we have learned in developing support and interventions.

As we work together and address program improvements, we will be better prepared to continue to meet the needs of current homeless veterans and wisely anticipate the needs of our returning troops.

Thank you for the opportunity to share my views today.

[The statement of Ms. Spearman appears in the Appendix.]

Mr. MICHAUD.  Thank you very much.

Mr. Bertoni?


Mr. BERTONI.  Good morning, Mr. Chairman, Members of the Subcommittee.  Thank you for inviting me here today to discuss VA's homeless providers' Grant and Per Diem Program.

Last year, VA ordered $95 million in GPD grants to over 300 local agencies who provide transitional housing for veterans.  The program is not designed to serve all homeless veterans but targets those most in need such as veterans with mental illness and substance abuse problems.

The program's goals are to help veterans achieve residential stability, increase income or skills, and greater self-determination.

My testimony today draws on our prior work and focuses on three areas.  We have updated some of the data to bring it up to real-time time frames.

Focusing on VA's efforts to expand program capacity to meet demand, provide collaboration and challenges to serve homeless veterans, and VA's processes for gauging program effectiveness.

In summary, VA estimates that on any given night, about 196,000 veterans are homeless and in need of transitional beds.  Since fiscal year 2000, the agency has increased the number of beds from about 2,000 to over 8,000 and increased the number of annual admissions from 4,800 to over 15,000.

Although the number of transitional beds available nationwide from all sources increased to more than 40,000 in 2006, VA estimates that about 11,000 more beds are needed to meet demands.

At the time of our review, the agency planned to expand the program by about 2,000 beds and to make beds available in every State.  However, an important demographic shift may require VA to reassess the type of housing and services provided in the future.

Officials told us that they expect to see more homeless women veterans and more veterans with dependents in coming years, a trend that is directly related to the current makeup of our active and Reserve forces.

The providers we visited often collaborated with public and nonprofit agencies in helping veterans recover from substance abuse or mental illness and obtain permanent housing, employment, financial stability, and services to facilitate independent living.

However, some providers face challenges serving veterans such as finding affordable permanent housing for those ready to leave the program as well as transportation, legal assistance, dental care, and substance abuse treatment.

Perhaps most importantly, however, we found that some providers did not fully understand certain program eligibility requirements and stay rules which could affect the veteran's ability to get care.  And VA was not consistently holding them accountable to program performance goals.

For example, some providers incorrectly believe that veterans could not participate in the program unless they were eligible for VA healthcare.  Others understood the life-time limit rule of three stays but were unaware that waivers could, in fact, be granted.

Per our recommendation, VA has taken steps to improve communication and ensure its policies are understood by VA liaisons and to providers responsible for implementing the program.

To assess program performance, VA primarily relies on measures of veterans' status at the time they leave the program rather than obtaining such information months or years later.  In part, this has been due to concerns about cost, benefits, and feasibility of doing more extensive follow-up.

Generally VA's data show that since 2000, an increasing percentage of veterans met each of the program's three goals at the time they left the program. 

During 2006, over half of veteran participants obtained independent housing.  Another quarter were in transitional housing programs, halfway houses, hospitals, and nursing homes.  Nearly one-third had jobs and significant percentages also demonstrated progress with alcohol and other substance abuse problems.

To obtain a more complete understanding of the program's effectiveness, we have recommended that VA explore feasible and cost-effective ways to obtain information on how veterans are faring in the longer term.

VA is considering an approach that would allow it to obtain information of participants' status 30 days after leaving the program.  While this is a step in the right direction, we continue to believe that obtaining additional information at a later point would provide a better indication of long-term program success.

Mr. Chairman, this concludes my statement.  I am happy to answer any questions that you or other Members of the Subcommittee may have.  Thank you.

[The statement of Mr. Bertoni appears in the Appendix.]

Mr. MICHAUD.  I would like to thank all three panelists for your testimony this morning.

My first question is for Ms. Spearman.  As a Grant and Per Diem Program provider, can you speak to how the reimbursement process and the restrictions have affected your ability to provide services?  And I know you mentioned about setting up a work group, but do you have any specific recommendations yourself on how to make the reimbursement process less burdensome?

Ms. SPEARMAN.  Well, I would say that I do not have all the answers for that.  I think that there are various things on the table right now that people are looking for.  But I do think that uncapping and looking at directly what the real costs are and developing a mechanism for that.

We have a lot of paperwork and a lot of monitoring that goes on and I feel like that it is excessive for the amount of money that it takes to do the program.

And I have mentioned also that the $31.30, I think that it is today, is just about what it would cost to just do the housing management or one overlay of service.

So even though the paperwork has been cumbersome, more important are the delays in getting stuff processed, I think mentioning the contract liaisons, I think that their training is hopefully going to improve that. 

But another recommendation in my written comment was that we would actually have them as part of the Grant and Per Diem Program because I do not think the goals of the VA medical centers are the same so that when they are processing, I think that our concern is that the VA takes the risk with us about putting people in beds at night, if that is what they need, that we are able to process that quickly and that we share some risk that that vet may not be exactly the right person for our program or we may be able to refer them on or to bring in some additional services.

We have just made the policy to go ahead and take the person into the bed and take all the risk.  VA has not been able to step forward and say we will pay, you know, due back payments on that particular veteran.  So we do have that issue of the paperwork interfering there.  We could go on on lots of individual things, but—

Mr. MICHAUD.  Thank you.

Do you want to answer as well, Ms. Beversdorf?  Are there any specific recommendations how the reimbursement process can be less burdensome?

Ms. BEVERSDORF.  I believe Kathy's testimony contains recommendations worth considering.  There needs to be more dialogue.  Most of the time, our members are frustrated because there is not good communication between the VA liaisons at the VA medical center and service providers.

Sometimes the easy way out is for service providers to not participate in the program or providers choose not to stay in the program.  That very much concerns us.  Given the need for additional beds, there is a need to modify the process so more providers are willing to participate.

Mr. MICHAUD.  Mr. Bertoni, you are the Director of Education, Workforce, and Income Security Issues.  Are there ways that we could streamline the reimbursement process?  Also, when you look at what is happening, particularly with more veterans coming back from Iraq and Afghanistan, with the Department of Labor cutting career centers, that is what they are called in Maine, how can we improve helping homeless veterans in finding job opportunities?

Mr. BERTONI.  I am sorry.  What was the first part of your question?

Mr. MICHAUD.  As far as the reimbursement being burdensome and ways to streamline the process.

Mr. BERTONI.  All right.  The reimbursement aspects and the payment scheme was not part of our review.  But in general, I would say personally we would like to see some empirical evidence as to what the effect is, what impact it would be having on providers, whether they are opting out of the program.  That would be helpful to determine, you know, factual base that there is a problem indeed.

As far as going to sort of an up-front payment versus reimbursement after the fact, I can understand where that would have a positive view amongst certainly the providers, why they would want that in terms of their planning and their ability basically to plan and figure out who they can serve going forward.

It does take some level of control away from the VA in terms of from an internal control standpoint.  So, again, GAO would have to do some type of analysis to assess the soft points, the sticking points, how substantive they really were before we could come down.  And, you know, what changes would be needed, I could not answer at this point.

As far as job opportunities, I think it is very important.  We have OIF and OEF servicemembers coming back.  Certainly in the Army, infantry members, many have very low levels of education, in need of job training.  There are programs out there.  I am not sure to the extent they are coordinated. 

We are doing some analysis right now in terms of eligibility for those programs, who is eligible, who is not being deemed eligible, the programs that are the comprehensive menu of services that are out there, as well as participation in outcome rates. 

And the bottom like, I think, from the Dole-Shalala Commission, we are trying to follow-up behind them and do some of our own analysis of that, there is no good data out there as to outcomes and long-term outcomes.  So I think we need to do some work there.

And certainly the changing nature of the injuries coming back now, the traumatic brain injuries, PTSD, really a lot of value in up-front screening, finding out what exactly these people need medically and then to get them set up for vocational rehabilitation training.

Mr. MICHAUD.  Great.  Thank you.

Mr. Miller?

Mr. MILLER.  Mr. Bertoni, are you pretty satisfied with, or do you think the number of 200,000 is a relatively realistic number?

Mr. BERTONI.  That is a tough one.  I think we looked at what VA did, their point-in-time analysis.  And given the unstable nature of the homeless population, we had no reason to question the reliability of that information.

Mr. MILLER.  Is there another, more reliable method or recommendation that you could give VA to help them get that number?

Mr. BERTONI.  We did not get behind the methodology or question the number, but we did walk through what they did to come to that number.  I think we are satisfied that they used a reliable approach in terms of point-in-time analysis and going down to the local level to try to get those counts.

They did consult other groups that would have information like HUD.  So I think while it is probably not a perfect figure, it is a reasonable figure.

Mr. MILLER.  The VA Office of Inspector General (IG) recommended that the operational oversight authority and responsibility for the GPD Program be centralized at a national GPD Program office.  Do you think this is a positive recommendation or do you have a view on it?

Mr. BERTONI.  I do not have a specific view on that.  I would just say in terms of oversight and accountability, whoever does it, there needs to be a sound program put in place with specific guidelines and criteria as to what guidelines have to be followed.

I do not think that is the case right now or it was not the case a year ago.  So in terms of whether it is centralized or it is decentralized, I think there still needs to be an accountability program and oversight aspect to this program that I do not think has always been there.

Mr. MILLER.  Ms. Beversdorf, you talked about reasonable measures of outcome and I had written down prior to that how do we grade success.  Can you describe what you would call a reasonable measure of outcome?

Ms. BEVERSDORF.  Our members report there is an evaluation system already.  And I would defer to Ms. Spearman for more details on that.

But there certainly needs to be an evaluation of the outcomes.  If a community-based organization submits a grant proposal with certain expected outcomes with respect to how many veterans they are hoping to treat, how many they are going to employ, how many they are going to provide services to, then those outcomes should be evaluated.

Obviously if our community-based organizations receive grant funding from the VA, they need to be responsible with respect to following through and performing the services they have indicated they would do.  It is necessary to measure to see if they have accomplished the purposes they said they would do.

I will give you a comparison.  The National Coalition for Homeless Veterans was recently awarded a grant from the VA to provide technical assistance to community-based organizations.   We are required to provide quarterly reports indicating what services that we have provided to our members in the way of communications, training programs, educational programs, and publications.

Receipt of per diem payment is not a blank check.  It requires responsiveness.  Community-based organizations must show the funding they receive is spent in a way that will ultimately benefits the client.

Mr. MILLER.  This is for both of you, Ms. Spearman and Ms. Beversdorf, would not the ultimate success be that the veteran is no longer homeless?  That he or she is placed, and is off the addiction, the alcohol or whatever drug addiction that they may be suffering from?  I know you have to check boxes, but would that not be the ultimate measure?

Ms. SPEARMAN.  Definitely, yes.  I mean, integration back in, working, those are things that I—I think we have all grown in this Grant and Per Diem Program since we have been a part of it for ten years and the staff have as well.  I think it may be time that we really could be more articulate about the goals that we are really looking to attain here because, as I said, it is very unrealistic when you think about what the steps are to take a person from, you know, the Ocala National Forest all the way to, you know, having a job, being retrained, being back into the community, and feeling good about that and, you know, no longer—

Mr. MILLER.  Is that one of the things that you track?

Ms. SPEARMAN.  We do all those things, but we do not do it with Grant and Per Diem money alone.  And so our goal, in fact, in the testimony that I have written, we have shown that we have been a part of a pilot project, two pilot projects in Florida doing outcomes only.  We only get paid if we deliver and it is a marvelous way to do business.  It takes some time.  It really takes sitting at the table, deciding what it is you want and how you are going to do those measures. 

But we get paid one-twelfth of our grant as long as 80 percent of all of our—if every single individual, 80 percent of the individuals move forward towards independence.  So it is a marvelous way to do business, but it is difficult.  But it is definitely an option.

Mr. MILLER.  Thank you for putting Pensacola in the mix.  We are glad to hear that there are some things planned. 

Again, between the two of you, is there more of a need for homeless veterans services in rural areas or urban areas because most of the focus appears to be on urban areas?  I was interested that you picked Trenton of all places.

Ms. SPEARMAN.  Yeah.

Mr. MILLER.  Trenton is an extremely rural community.  I was a Deputy Sheriff there when they only had one light in the county

Ms. SPEARMAN.  It still only has one light.

Mr. MILLER.  Right there in downtown Trenton, the whole county had one red light.  I know it is great everywhere, but where is the need the greatest? 

Ms. SPEARMAN.  Well, I will answer that first.  Okay.  I think there is a lot of need in the urban areas and they do congregate, a lot do.  But one of the reasons that we did the mobile service center, and that came from working with the VA staff in Veterans Integrated Services Network 8, is that everybody got together and sat at the table and talked about how were we going to outreach to the barrier islands around the Keys and into the national forest and how were we really going to go back in there.  And that is how the mobile service center came about and then, you know, we developed the housing after that.  But I do not know. 

Ms. BEVERSDORF.  I would echo.  Sometimes, frankly, that is the frustration.  The National Coalition for Homeless Veterans represents community-based organizations in 48 States.  However, if you take a look at our annual report or a map of the United States, which indicates where these community-based organizations are, of course, there are fewer in Wyoming and North Dakota and some southern States as opposed to Florida or New York or California or Texas or Ohio.

And it is a dilemma.  One of the things I am most proud of with respect to the direct services NCHV provides is we have a 1-800 toll free number.  And we get as many as 300 calls a month, many of them from veterans who are either homeless already or at risk. 

Someone will call and say, "Hi, I am so and so and I am homeless."  He will also say, "Where can I go?"  I immediately log onto our web site and ask, "Where are you calling from?"  "Well, Shreveport, Louisiana."

Because we have a list of all the community-based organizations, I really want to try and connect these individuals with community-based organizations that are located there.  I may be lucky.  I may be not. 

So then I may have to become more creative.  Well, let's see.  How about faith-based organizations?  I go through that list.  How about perhaps veteran service organizations that might be able to help you?  Have you contacted the Red Cross?  How about other religious organizations?  You are absolutely right, Mr. Miller.  If there is not any community-based organization there, a place where they can go, they remain homeless and that's a problem.  They are coming to these community-based organizations if they know where they are located,.  This is one of the reasons why NCHV has been trying to reach out to non-VA supported community-based organizations as well because there are places where VA funding has not been provided or, in some cases, these organizations do not know about Grant and Per Diem.  Major issue.

Ms. SPEARMAN.  And let me just say one more thing in terms of I think they are harder to reach in the rural areas.  But I think the Vietnam era, that is where they have gone to to live.  Those who have not, you know, stayed in the city.  There is a good number. 

So we have found many, many back in the forests.  And you do not go back in there uninvited.  And so you build rapport and it takes a very long time.  But there are thousands back in the forests in Florida that we have identified and actually had an opportunity to interact with. 

So they are harder to serve.  They are harder to find.  They are harder to bring into the system.  They have been off the streets, in the woods.  And so it is a mix, but I think the numbers are in the urban areas.

Mr. MILLER.  Thank you.

Mr. MICHAUD.  Thank you.

Mr. Salazar?

Mr. SALAZAR.  Thank you, Mr. Chairman.

And, first of all, let me thank all three of you for the services that you provide for veterans.

Ms. Spearman, you talked a little bit about taking veterans in at risk, not really knowing whether you are going to get reimbursed or not.  And, of course, veterans would be eligible for not only veterans' programs but probably eligible for Medicare, Medicaid, and other programs.

Do you think that maybe centralizing the system like, I think that is what you were getting to, Mr. Miller, maybe doing a pilot program to figure out if we would have a clearinghouse to see what programs each veteran was eligible for?  Do you think that would help or is there already such a program?

Ms. SPEARMAN.  I do not think there is anything specific like you mentioned.  And I do not know that would be the answer.  I just do not have an opinion on the centralization.  I am sorry.

Mr. SALAZAR.  Well, when I get questions in my office from many veterans, well, you know, I think I am eligible for this, I do not know whether I am, can you help me.

Ms. SPEARMAN.  We have staff that do that.  We have staff that have been trained by the VA, the VA benefits administrators.  And I think that is one thing about the VA working more closely with the community is that a lot of community providers have no idea what a veteran is entitled to through the VA.  And then those who have veterans in their programs who are not a part of the the Veterans Benefits Administration system, just have chosen not to, it just works both ways. 

There is a lot of lack of communication about what a veteran is entitled to.  And we spend a lot of time as Volunteers of America of Florida in the State, you know, trying to go to meetings and saying, you know, there are a lot of things that you are providing that veterans are eligible for.  So I think a close working relationship on that, whether a screening or a centralized system. 

I think the key is that we need to be able to respond a lot faster than we are responding.  And I think that the community providers feel that most strongly and I think the VA typically just, you know, they do not see it as very positive, so it does not happen that way.  So we are just much more proactive on an individual person by person because we are sitting there eye to eye and we are the provider. 

We are the 24/7, you know, care service for that person or we are there in the community and available 24/7 and we have access to other linkages, so we spend more time believing in that system and how that—

Mr. SALAZAR.  So the burden basically becomes yours to figure out what programs this individual is—


Mr. SALAZAR.  —eligible for?


Mr. SALAZAR.  Mr. Bertoni, could you respond to that?  Do you think that would help maybe expedite the process and be able to reach more veterans than what we are reaching right now?

Mr. BERTONI.  If you had a single entity that essentially counseled folks on the menu and range of services that were available to them, the alternatives—

Mr. SALAZAR.  Right.

Mr. BERTONI.  —is that the question?  I suppose it would work.  I do not know if it is necessary.  Again, we have not done enough thinking about it to give you a definitive answer.

I do know at all 57 VA regional offices, there are veteran service organizations, VSOs, that are supposed to be doing just that, to sit down with veterans who are walking in.  And I am sure they have a great handle on the range of services.

And I would hope that the veterans that are involved in the GPD Program are interfacing.  And I think they would because there is a healthcare aspect there in terms of veterans' healthcare.

So if right now without a total restructuring, I think a good source would be for referral or a more aggressive role for the VSOs.

Mr. SALAZAR.  But do not VSOs just work specifically with VA programs?  But there are other government programs such as Medicare, Medicaid, that, you know, your veterans are transitioning to and become eligible for that maybe some kind of a pilot program, Mr. Chairman, could be set up to where we could expedite this process.  And I think it would make it much simpler and the risk would not fall upon the service providers.

Mr. BERTONI.  One observation.  I do believe the Social Security Administration and VA are beginning a similar effort to try to coordinate in terms of Social Security benefits versus VA benefits.  I think it is very early on now.  I do not know how far along it is.  We are actually thinking about looking at that.

Mr. SALAZAR.  That is all I have, Mr. Chairman.  Thank you.

Thank you.

Mr. MICHAUD.  Thank you very much.

Dr. Snyder?

Mr. SNYDER.  Thank you, Mr. Chairman.

This challenge reminds me of the challenge that we were facing several years ago with regard to TRICARE payments to medical providers and probably some of my provider friends are probably telling me that they are still facing, but I think it is substantially improved, which was one of my doctor friends back home that managed a very large practice said that the problem with TRICARE payments is that they were low, they were slow, it is complicated.

And you could handle one of those as a provider.  You cannot handle all three of them together, where if the payment is low, it is slow getting to you and the paperwork burden is complicated to finally get the low payment to you in a slow manner.  Help me, if you would, because this is an area that I do not know a lot about. 

It seems to me that there are like five options out there.  One is to do nothing and just going with the current reimbursement rate which I do not think anyone would be satisfied with that.

The second one would be to increase the per diem rate, but basically keep the system like it is.

The third one would be to go to a cost of service option probably with some kind of geographical variation that people would have to say here is what our actual costs were to get reimbursed.

A fourth would be to have some kind of grant program that would pay for, I assume, some kind of annual grant to provider services that may or may not allow for some beds being empty.

And the fifth one is some kind of program of permanent housing, supporting homeless veterans in permanent housing.

Are those the basic five options we are looking at?

Ms. SPEARMAN.  I will respond to that.  I think that is definitely in the mix.  I think there are some others that could be considered.

Mr. SNYDER.  What are those?

Ms. SPEARMAN.  One would be doing a housing per diem base; what it really does cost to do housing management and place people in housing and house them.  And then maybe some service overlays.  I know geographical consideration is important, but also the level of service. 

There are providers that are excellent providers that can only do a minimal amount of services, whereas Volunteers of America of Florida may be able to do, you know, clinical treatment, substance abuse treatment, a lot of other things that VA is not able to, you know, keep up with.  And we could do a lot more levels of service. 

So obviously with services come dollars.  So there could be levels of service of per diem on top of that.  And they are, you know, an outcome base where you would have like maybe a grant based on cost and then you would do it with performance. 

So there are some others.  There are some others that are used by HUD that are used by other programs that some of us are familiar with.  But you hit on some.  I hope we will not pick the one to do nothing.  I hope that we will move forward.

Mr. SNYDER.  I appreciate what you are saying about the different levels of services that different organizations choose to provide or can provide or have the capability to provide and some of that is going to be geographic because some areas have more services available than others. 

But when it is based on cost, what is the incentive for the organization to keep costs down?  Tell me how that works as you see it.

Ms. SPEARMAN.  Well, you know, you are going to have to operate within your cost if you do the budget and you are monitored on the budget to keep your costs within.  I do think there should be, you know, a cap on, you know, what it is, whatever you presented in your budget. 

I think a per diem for a larger organization, the incentive is that you have the flexibility to spread some of your costs and get some money to the bottom line.  In terms of a business, it is an on-going concern to make sure that you are putting more money back into the program.

So I mean, I just think you are going to be bringing in other dollars regardless from other—I mean, I do not think that the grant per diem is going to pay for all that needs to be done for homeless veterans to get them where they need to go.  So I mean, I do not know.  Maybe I did not answer the question.

Mr. SNYDER.  Thank you, Mr. Chairman.

Mr. MICHAUD.  Thank you.

Once again, I would like to thank the three panelists for your testimony this morning and look forward to working with you as we move forward on this issue.  So thank you very much.

Ms. SPEARMAN.  Thank you.

Mr. MICHAUD.  I would like to have the second panel come forward.  George Basher who is Chair of the United States Department of Veterans Affairs Advisory Committee for Homeless Veterans.  He is also Director of the New York State Division of Veterans' Affairs.

Peter Dougherty who is the Director of Homeless Veterans Program at the Department of Veterans Affairs who is accompanied by Paul Smits who is Associate Chief Consultant for Homeless and Residential Rehabilitation at the Department of Veterans Affairs.

I would like to welcome this next panel and we will start off with Mr. Basher.



Mr. BASHER.  Chairman Michaud and Members of the Subcommittee, I am pleased to be here today to discuss the VA Grant and Per Diem Program serving homeless veterans.  I thank you for the invitation to testify before the Subcommittee and discuss this worthy program.

I have had the honor of serving as the Director of the New York State Division of Veterans' Affairs for the past ten years and also currently serve as the Chair of the Department of Veterans Affairs Advisory Committee on Homeless Veterans.

In both of these roles, I have had the opportunity to witness not only the benefits of this program to those veterans who need a hand getting back on their feet, but also the challenges it brings to the provider community.

Recent estimates by the National Alliance to End Homelessness place the number of homeless individuals in the United States at 750,000.  VA estimates the number of homeless veterans to be approximately 180 to 200,000, making homeless veterans one-quarter of the entire homeless population.

Established by Congress in 1992, the Grant and Per Diem Program has provided nearly 10,000 transitional beds for homeless veterans through the efforts of over 300 community-based providers.  These community and faith-based organizations provide shelter, food, and supportive services to homeless veterans for up to two years for a per diem currently set at a maximum of $31.30 a day.

Originally designed to meet the needs of Vietnam era veterans, I believe it is time to revisit the Grant and Per Diem Program in light of the need to also serve the veterans of the current conflict as well as those older veterans.

VA estimates they have already seen over 1,500 OEF/OIF veterans in various settings with several hundred referred to GPD providers for assistance.

The VA Advisory Committee on Homeless Veterans in its recent report discussed concerns about Grant and Per Diem. Specifically, first, the VA Grant and Per Diem Program uses a process to reimburse providers designed like the system VA uses to reimburse State governments for the State Home Program.  The Advisory Committee is concerned that this capped process discourages providers in high-cost areas from even applying.

The current $31.30 rate is based in law on the rate paid to State Home programs.  There is no basis, in fact, for the $31.30 rate in the State Home Program and no defined rationale for determining that figure. 

Additionally, the current process does not allow the use of other Federal funds without offset by VA.  While the State Home Program rules were recently changed to allow this, the restriction of offsets still applies to Grant and Per Diem programs.

Second, the accounting process required for reimbursement is a burden on small community-based providers.  Asking this group to meet the same level of expertise as State governments with larger accounting staff is unreasonable and discourages participation.

Additionally, recent audits of some providers have led to allegations of significant overpayments sometimes years after the fact based on differing interpretations of allowable expenses.

Parenthetically this devolves from that idea that the contract oversight and inspections are done by VA medical center staff, the liaisons, and I think we have got over 120 different people inspecting 300 different programs.  The notion that this is all being done uniformly, fairly, and accurately is probably silly when you stop and think about it.