VA Health Care: Changes Needed to Improve Resource Allocation to Health Care Networks Page: 7 of 17
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VA Could Better Align
Resources with Workload
and Network Cost
Differencesnetwork control by incorporating more categories into VERA's case-mix
adjustment to more accurately account for the differences in networks'
patient health care needs. Finally, we recommended that VA improve its
process to protect patients from network budget shortfalls by determining
the extent to which different factors cause networks to need supplemental
resources in order to address factors, such as inefficiency, that may cause
budget shortfalls.
To improve its network workload calculation, VERA should account for all
veteran workload served-including Priority 7 veterans, who have higher
incomes and no service-connected disabilities.7 By excluding most
Priority 7 veterans from VERA's workload calculation, networks with a
higher proportion of Priority 7 veterans have fewer resources per patient to
treat veterans than networks with a lower proportion of Priority 7 veterans.
For example, in fiscal year 2001, Network 3 (Bronx) had the highest
proportion of Priority 7 veterans, 37 percent, and Network 20 (Portland)
had the lowest proportion, 14 percent. Nationally, VA's proportion of
Priority 7 veterans was 22 percent of total workload in fiscal year 2001.
When VERA was established, the number of higher income veterans
without service-connected disabilities that VA treated was about 4 percent
of the total number of veterans treated in fiscal year 1996. VA decided not
to include most of these Priority 7 veterans in VERA's basic care workload
calculations because of their small numbers and the expectation that
collections from copayments, deductibles, and third-party insurance would
cover most of their costs. However, Priority 7 veterans accounted for 22
percent of VA's workload in fiscal year 2001-a substantial increase from
107,520 patients in fiscal year 1996 to an estimated 827,722 patients in fiscal
year 2001.8 In addition, VA projects that the growth in Priority 7 patients
will continue at least through fiscal year 2010. Although VA initially
expected to cover the majority of Priority 7 patient costs through
7VA's Office of Inspector General also recommended that VA include Priority 7 workload in
the VERA model. See Office of Inspector General, Department of Veterans Affairs, Audit of
The Availability of Healthcare Services in the lorida/Puerto Rico Veterans Integrated
Service Network (VISN) 8, Report Number 99-00057-55 (Washington, D.C.: Aug. 13, 2001).
sVERA does include some Priority 7 veterans in its workload measure. In fiscal year 2000,
about 8 percent of Priority 7 veterans treated were included in VERAs workload measure
because they were complex care patients or basic care patients with service-connected
conditions.GAO-02-744T
Page 6
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United States. General Accounting Office. VA Health Care: Changes Needed to Improve Resource Allocation to Health Care Networks, text, May 14, 2002; Washington D.C.. (https://digital.library.unt.edu/ark:/67531/metadc290062/m1/7/: accessed April 19, 2024), University of North Texas Libraries, UNT Digital Library, https://digital.library.unt.edu; crediting UNT Libraries Government Documents Department.