Veterans' BenefitsSavings From Reducing VA Pensions to Medicaid-Supported Nursing Home Residents Gao ID: HRD-92-32 December 27, 1991
As a result of the Omnibus Budget Reconciliation Act of 1990, the Department of Veterans Affairs (VA) should be able to reduce pensions by about $174 million annually for veterans receiving Medicaid-supported nursing home care. If pending legislation that would include survivors is passed, VA could cut pensions by an additional $296 million. The combined $470 million cost would be transferred by VA to the Department of Health and Human Services and the states under the Medicaid program, resulting in a net federal savings of about $202 million annually. Passage of the bill would treat veterans and survivors in the same way. VA has not fully implemented the 1990 act. By not adequately controlling the case review process, VA did not reduce all affected veterans' pensions. VA is planning changes that eventually should identify all veterans' cases in which pensions should be reduced. If the proposed legislation reducing survivor benefits passes, significant savings could result. Thus, VA should revise its procedures to better ensure that survivor cases are reviewed and pensions reduced in a timely manner. VA also needs to improve its explanation of pension reductions to persons affected.
GAO found that: (1) OBRA 1990 could enable VA to reduce pensions by about $174 million annually for veterans receiving Medicaid-supported nursing home care and could reduce pensions by an additional $296 million if Congress enacts a pending legislative proposal to treat veterans and survivors equally in OBRA; (2) VA plans to transfer the combined $470- million cost savings to the Department of Health and Human Services and the states under the Medicaid program, which could result in annual net federal savings of about $202 million; (3) VA has not fully implemented the OBRA 1990 legislation; (4) VA has not timely reduced pensions for all affected veterans, given veterans clear and informative payment reduction notices, and adequately controlled its case review process; and (5) VA is planning to initiate changes to identify veterans' cases where pensions should be reduced.Recommendations
Our recommendations from this work are listed below with a Contact for more information. Status will change from "In process" to "Open," "Closed - implemented," or "Closed - not implemented" based on our follow up work.Director: Team: Phone: