The State Home Per Diem Program
Patty Gheen
VHA Deputy Chief Business Officer for Purchased Care
Overview of the State Home
Per Diem Program
• Introduction and Program Scope
• FY 2011: National Workload and Expenditures
• FY 2012 Basic Per Diem Rates
• Current and Long Range Initiatives
• Summary
• Points of Contact
2
Introduction and Program Scope
• VA’s State Home program provides quality care for eligible
Veterans in nursing home, domiciliary, and adult day health care
programs
• VA’s State Home program is an economical alternative to
constructing, maintaining and operating VA-owned facilities
• The VA pays a portion of the Veteran’s costs
• The state homes are owned, staffed, and operated by the States
3
Introduction and Program Scope
• VA has a partnership with the States for 189 state home
programs
• These are located in each of the 50 states and Puerto Rico
• At present, there are 134 nursing homes; 54 domiciliaries;
and one adult day health care program
• FY 2011 program costs were $826.7 million
• Note: Numbers of state home programs and levels of care depicted
above are as of the close of FY 2011
4
Introduction and Program Scope
5
Alignment of VHA State Home Program
Management Responsibilities
6
Summary of National State Home
Workloads and Expenditures for FY 2011
• Program Scope
• Eligibility for Payment of State Home Per Diem
• State Home Per Diem Rates
• Authorized Bed Levels
7
Program Scope: FY 2011
• State Nursing Homes (134):
Basic Rate Per Diem Payments:
$630,761,213
SC Per Diem Payments (PL 109-461):
$144,605,032
State Domiciliaries (54):
• Adult Day Health Care (1):
$50,838,688
$456,865
---------------------
• Total FY 2011 Per Diem Costs:
$826,661,798
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DISTRIBUTION OF FACILITIES
ADHC
1
.01%
Domiciliaries
54
29%
State Nuring
Homes
134
71%
9
Distribution of Expenses by Program
FY11 Program Outlays (in millions)
State
Domicilliaries,
$50.84
Adult Day
Health Care,
$0.46
State Nursing
Homes,
$775.37
10
Eligibility for Payment
of State Home Per Diem
• VA per diem payments to States are only paid for the care
of eligible Veterans
• The Secretary of the Department of Veterans Affairs may
adjust the per diem rates each year
• There are two payment methodologies for nursing home
care; a higher rate for SC Veterans and a basic rate for
NSC Veterans
• Non-Veteran residents are not entitled to payment of VA
aid
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Eligibility for Payment of SH Per Diem
and the Provision of Medications
State Veterans Nursing Homes - 38 U.S.C. 1745
Per Diem Funding by VA
Prescribed Medications
Rating-Singular or Combined Higher Per Diem Rate Basic Rate ($95.82)
Rating-Singular or Combined
100
100
90
90
80
VA will pay the higher
per diem
State home can not
opt for the basic rate
80
70
70
Rating of Total Disability based
on Individual Unemployability
Rating of Total Disability based
on Individual Unemployability
60
60
50
50
40
30
20
If veteran needs nursing
home care for SC
condition, VA pays the
higher rate.
The basic per diem
rate applies. For FY
2012 the rate of
$95.82 has been set
for veterans not
receiving nursing
home care for a
service connected
condition
Status
Not provided by VA.
Aid and Attendance
rules do not apply.
VA will furnish all
m edications
prescribed unless
veteran is receiving
care for reasons that
include care for a VA
adjudicted SC
disability.
40
30
20
10
10
0
0
VA will furnish
medications needed
to treat a SC
disability.
Aid & Attendance
rules also apply.
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Authorized Bed Levels
Level of Care
Beds Authorized
Nursing Home
24,480
Domiciliary
5,984
Adult Day Health Care
50 (slots)
Total:
30,514
Note: Numbers depicted are current as of 12/2011
13
FY 2012 State Home Per Diem Rates
• The FY 2012 basic state home per diem rates are:
State Nursing Home: $95.82
State Domiciliary: $39.90
State Adult Day Health Care: $75.40
• These rates are to be used for care that will be
provided from October 1, 2011 through
September 30, 2012
• The VA Prevailing Rates for service-connected
Veterans were released to VAMCs of jurisdiction
and the State Homes on Oct. 21, 2011
14
Current and Long Term Initiatives
CBO worked to enhance and standardize
business processes through:
1. analyses and discussions to determine
viable state home per diem payment
methodologies
2. the development of internal program
controls, audit tools, and future-state
technology systems
3. increased communication flow with VA and
non-VA stakeholders
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Current and Long Term Initiatives
4. CBO re-wrote and updated national policy for the
State Home Per Diem Program. The new VHA
Handbook for the State Home Per Diem Program
was released to VHA field activities on August 25,
2011
5. CBO established monthly state home per diem
program conference calls to provide guidance and
direction to VISN and VAMC of jurisdiction
program managers
6. CBO developed a comprehensive new VA Intranet
web site for the state home per diem program
16
Current and Long Term Initiatives
• CBO is developing a plan to standardize and
automate the business processes around the
initial application process as well as the payment
processes
• Our intent is to develop new and automated
information technology solutions to processes
for both VA and the State Home community
• A national review is ongoing to define business
requirements to automate the process in which
State Home Per Diem Program process flow is
conducted and to look at options for the future
17
Current and Long Term Initiatives
• Areas under review include workload processing,
data capture, financial management, and
information technology (IT) solutions
• As a part of this national review, CBO has
solicited NASVH input
• Additionally, CBO is exploring a regulatory
change to allow State Veteran Homes to hold a
bed for a Veteran for up to 30 days when
temporarily transferred to an institution for acute
care services
• Will promote better tracking of Veterans and
decrease administrative burden
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State Home Per Diem Program
FY11 Summary of Accomplishments
• Pursued multiple initiatives to enhance communication with VHA
field activities. Revised national policy; began monthly
conference calls; launched new VHA intranet State Home per
diem web site; conducted regional training forums; met with
external VA stakeholders
• Provided guidance and assistance to numerous VA/VHA audit
activities (e.g., OIG, IPERA, MQAS, FQAMs)
• Surveyed State Veterans Homes to help assess issues
associated with SC payment methodologies
• Transitioned from CITRIX to SQL for workload and expenditure
reporting. High acceptance by VHA field activities. Field tested
at 20 VAMCs of jurisdiction. User-friendly interface. Artificial
Intelligence capabilities to help reduce errors and improper
payments
19
Potential Policy Changes
• Dom/ADHC Update
• 30-Day Residency Requirement
• Contracted Rates
• Proposed rule to require the use of MDS 3.0 vs 2.0
20
Recent Changes Affecting
VA Form 10-10SH Admissions Applications
• The new VHA Handbook for the State Home Per Diem Program
adopted three of the OIG’s recommendations concerning the
state home application forms (VA Forms 10-10EZ and VA Form
10-10SH, State Home Program Application for Veteran Care
Medical Certification). New VHA policy requires that:
• The medical need for the level of care (nursing home,
domiciliary or adult day care) must be verified in writing on
the VA Form 10-10SH by the signature of a VA physician or a
qualified licensed physician assistant or nurse practitioner
currently employed in a VA long term care setting
21
Recent Changes Affecting
VA Form 10-10SH Admissions Applications
• This represents a change from previous policy where it was
restricted to only a VA physician
• VA administrative and clinical reviews must be conducted
within ten business days after the application forms are
received by the VAMC of jurisdiction
• Important: Recent VA audit findings indicate that some
VAMCs of jurisdiction had not received the 10-10SH at all;
they weren’t on hand during the audit. Secondary to that,
some forms had been received, but the VA certification and
the signatures had not been on the form to verify
administrative eligibility or the approval or the disapproval of
the clinical eligibility for the level of care
22
Payment Models being Considered
Under the Contract Option
• VA is considering the use of contracts to allow VA and the
States flexibility in multiple payment methodologies to support
the highly service connected (70% or greater and those
receiving treatment for SC conditions)
• The intent of the contracts is to allow VA and the respective
State the opportunity to use a payment model that supports
their programmatic differences inherent within each State
• The models being considered are based on industry standard
payment methodologies but also adjusted to meet critical
financial concerns for higher cost residents. The models will
support State Homes who are Medicare certified as well as
those State Homes who currently do not have Medicare
certification
• The contracts will also include provisions to outline covered
services as well as potential high cost outliers
23
Payment Models being Considered
Under the Contract Option
The models in review are:
•Individual Resource Utilization Groups (RUGs): This
model uses the individual RUGs score for each resident
(typically calculated quarterly) and applies the Medicare
rate for those individual RUG score. This will allow for
significant variation in patient acuity and care
requirements. With some 66 RUG scores, it may be
challenging for non-Medicare certified homes.
•Prevailing Rates: This is VA’s current methodology, using
an average of prevailing rates under skilled nursing
programs. This is likely the preferred option for nonMedicare certified homes.
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Payment Models being Considered
Under the Contract Option
• NASVH considered four payment models, individual RUGs, grouped
RUGs, Medicaid-plus, and the prevailing rate and narrowed that down
to individual RUGs and prevailing rate
• Preliminary NASVH feedback, based on information from 6 of the 8 test
sites, indicates:
• A general feeling that most State Veterans Homes would likely select the
prevailing rate to cover basic nursing care, as most feel it would provide the
simplest and most efficient billing process
• NASVH analyses, however, did not account for any “outlier” costs for
specialty care or highly skilled nursing services ( e.g., exclusions or
exemptions that would be authorized under Medicare rules). These
provisions still need to be worked
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Summary
• VA’s state home program plays a major role in delivering
long term care to our nation’s Veterans
• The program is expected to have future growth
• As VHA’s state home per diem program manager, CBO has
developed a number of initiatives that we believe will
further enhance the national program
• This includes establishing an active and regular dialogue
with internal VA stakeholders, state home Administrators
and NASVH leadership
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Contacts
For additional information, please contact:
Joe Enderle
joseph.enderle@va.gov
(740) 773-1141, ext. 6220
Harold Bailey
harold.bailey@va.gov
(303) 331-7551
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Questions/Discussion
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