Yountville VA Home

SACRAMENTO – The U.S. Veterans Administration has been a font of scandal in recent years, with various reports showcasing the way the agency charged with caring for our nation’s veterans has fallen down on the job. A new report from California’s official watchdog agency, the Little Hoover Commission, shows that the California Department of Veterans Affairs, known as CalVet, fails to provide adequate help, as well. The heart of the report is not about scandal – but about a set of priorities that hasn’t changed much in a century.

In particular, the report spotlights California’s $306 million program to provide housing to those veterans and their spouses who cannot take care of themselves. The commission took a 16-month look at the state’s eight homes and concluded that “fewer than 1 percent of the state’s 1.7 million veterans benefit from the 2,610-bed program … .” It points to a variety of measures that could stretch that funding to help a larger pool of needy veterans.

As the report points out, the current budget amounts to a “staggering” per-bed cost of $117,241, with the state footing the bill for $71,000 per bed each year when Medicaid and Medicare revenues are figured in. Although most of the people who are in the state-home system are veterans of World War II and the Korean War, an increasing number are Vietnam War veterans, and they tend to have more complex “physical and mental health needs.” The homes also are serving a larger percentage of veterans from more recent conflicts such as Iraq and Afghanistan.

The report finds that residents typically are admitted on a first-come, first-served basis rather than being admitted based on their financial hardships and health needs, although there are some priorities for homeless veterans and Medal-of-Honor recipients.

Basically, California runs an aging bricks-and-mortar system at odds with current trends in long-term care, which focus more on community settings rather than large institutions, according to the commission. Those newer local-oriented models “generally cost less than institutional care, and also allow families to avoid potential hardships stemming from separation that is unavoidable in institutional-care settings.”

This “opportunity cost” issue is key. If the state is spending the bulk of its funding on large veterans’ homes that serve a small number of people, it’s unable to spend those dollars on other services targeting a more broad-based clientele. “California’s veterans home beds come at a cost, both in terms of the high price tag of health care, as well as the opportunity cost of not investing elsewhere,” according to the report. A New Approach to California’s Veterans Homes offers a wide-ranging reform plan.

The first recommendation would require legislative action. The commission calls for legislators to amend the Military and Veterans Code to ensure veterans’ homes are able to provide first access to the neediest veterans. It calls for developing an admission system that ranks disabilities, financial status and other admission factors. It also calls for the Legislature to amend the code to end “domiciliary care” – i.e., supervised living arrangements – and focus instead on providing “high-level medical care, such as skilled nursing care.”

Veterans homes built with federal funding must operate for 20 years, but the commission calls for CalVet to evaluate these facilities as that 20-year mark approaches and consider whether to keep them in operation. The state can immediately stop building new homes, however, as it moves toward a different service model. As the agency “repurposes” these buildings, the commission argues savings should be redirected toward home and community-based services.

The report’s main recommendations share the theme of moving away from the existing institutional model and moving toward community care. It also calls for more transparency in CalVet’s budgetary reports, and calls for amending current regulations “to specify consequences for residents who do not maintain adequate insurance coverage or otherwise pay their share of the costs.”

The goal is to serve a larger number of needy veterans, as summed up by Little Hoover Commission Chairman Pedro Nava’s statement: “We must start questioning assumptions and past decisions about what kind of care veterans want and need and how it is best delivered.” That fits with the commission’s charge of helping the state take a fresh look at how its bureaucracies are operating.

CalVet is trumpeting a new rating from the Centers for Medicaid and Medicare Services giving its Chula Vista and Yountville veterans’ homes a four-star rating, “placing them among the highest performing facilities throughout the state.” That’s good news, but the Little Hoover Commission’s latest effort is focused less on the quality of care provided at any of the state’s facilities, and more on the way to stretch the department’s resources to help other veterans.

The commission also wants the veterans’ homes to become more self-sufficient and less dependent on the general fund. In some cases, the report argues, veterans’ homes could operate without any general-fund support whatsoever. The commission last reviewed the veterans’ homes in 2013.

Assemblywoman Jacqui Irwin, D-Thousand Oaks, who chairs the Assembly Veterans Committee, requested the latest review in 2015. She’s pointed to progress over the past few years, but noted a number of ongoing personnel and budgetary problems. She argued that CalVet’s Veterans Services Division, which helps connect veterans with available benefits, only receives 25 percent of the department’s budget “due to the expense of the homes.” The homes are important, she wrote, but only serve a tiny portion of California’s 1.7 million veterans.

In recent years, the Legislature has been more focused on creating new funding sources for the veterans’ homes than rethinking the entire veterans’-home model. This year, Irwin has introduced a bill that would implement the “needs assessment” recommendation in the commission’s report. And bills from other Assembly members would implement other recommendations, including measures promoting fiscal transparency. So perhaps the Little Hoover Commission’s latest report finally will spark a more wide-ranging discussion.

Steven Greenhut is Western region director for the R Street Institute. Write to him at sgreenhut@rstreet.org.

In its recently released report, “An Agenda for Veterans: The State’s Turn to Serve,” the bi-partisan Little Hoover Commission critiques the California Department of Veterans Affairs for its “inconsistent leadership” and inability to fully take advantage of funds set aside for veterans.

The dysfunction becomes more pressing every day. California’s population of veterans — already at 1.8 million, the largest of any state — will see annual growth of about 35,000 in the coming years.

CalVet and its flaws

CalVet’s vision is simple. Its Website promises, “CalVet will be the state’s leading advocate and resource so veterans can achieve the highest quality of life.” The department employs 2,600 workers and has an annual budget of $405 million. The CalVet Veterans Homes Division, which provides long-term care for homeless, disabled and retired veterans, consumes nearly 80 percent of the department’s budget.

The Farm and Home Loan Program consumes $66 million a year. Yet the results are low. According to the report, “The program issued 81 loans totaling $8.8 million in the 2012-13 fiscal year. The program also has collaborated with Habitat for Humanity to build, through a sweat equity program, homes for veterans.”

But a weak Veterans Services Division, charged with outreach and educating veterans about their access to certain federal benefits, is undermining the department’s ambitious goals—and hurting the state in the process.

“The overriding problem for California is that many California veterans are eligible for federal benefits that they need, but they are not enrolled to receive them,” the report says.

The Texas population of veterans, comparable in size to California’s, drew down an average of 30 percent more in veterans' benefits than California’s. Florida’s drew down 16 percent more.

“Texas and Florida each have a very aggressive outreach program. They also have a fairly good veterans service representative core,” J.P. Tremblay, deputy secretary for communications and legislation, said in an interview. (He added that Florida’s large retiree population and Texas’ many military bases are also natural advantages.)

In fact, CalVet has based one of its marquee efforts — the implementation of a 36-person strike team to lessen the backlog of soldiers waiting for benefits — on a Texas program.

According to the report, encouraging veterans to seek benefits may actually be fiscally responsible (bold emphasis added):

“Some who do not draw down their federal veterans benefits instead turn to public aid programs. Veterans experts told the Commission that California leaves between $500 million and $1 billion a  year in federal money untapped because California veterans are not  signed up for benefits and services to which they are entitled and have  earned. Getting more California veterans signed up for their federal Veterans Administration benefits could improve their lives, bring more money into the state economy and reduce demand on state services.”

The chair of the state Senate Veterans Affairs Committee is Sen. Ben Hueso, D-San Diego. He told U-T San Diego that the report contained “important insight on how we can improve our veteran services and invest in ways that will allow us to effectively leverage federal dollars to benefit California veterans.”

The report also notes that CalVet has “suffered through long stretches of turnover at the secretary level, often when strong leadership was needed to implement needed change.”

This has made the department slow to adapt to changes, according to the report, and has prevented CalVet from harnessing “the potential of the state’s many non-profit partners, including the main veterans organizations.”

Said CalVet Secretary Peter J. Gravett in a written statement, “[T]he department now has a new strategic imperative to refocus its efforts on the needs of our state’s veterans and the continuum of services available to them.” Gravett and CalVet did not contest any of the report’s findings.

Practical solutions

The commission also spells out several concrete recommendations for CalVet.

Since the Legislature has already provided $6 million in one-time funds to review and clean up benefits claims, the report says, it “should monitor the department’s results to determine whether additional funding is warranted.”

Also, the report suggests sending operational savings to a litany of services that help veterans file benefit claims and pursue referrals for services. (Currently, savings from operational efficiency are sent to California’s general fund.) The report also suggests several strategies — such as investing more heavily in social media marketing — as a means of engaging the community of veterans.

The commission also suggests that the Legislature and governor “review and update the Military and Veterans Code” of the state, which was described in a Little Hoover Commission press release as “confusing, contradictory and misaligned with current CalVet practices and veterans’ needs.”

Most salient, though, was the commission’s recommendation that California’s state and federal representatives “work with and press federal agencies to obtain up-to-date information from veterans and relay it to appropriate state agencies through electronic means.”

Such a program would enable California to develop a database of veterans and to reach veterans sooner after their departure from the military, helping veterans file faster and more accurately.

Tremblay said that CalVet has already begun to use the Defense Personnel Records Information System. According to its Web site, DPRIS “provides a conduit for the secure electronic retrieval of document images” from military personnel records. (Access to these records is often necessary for veterans applying for benefits.)

But in a frustratingly complex bureaucracy, the state often works against itself while trying to help.

“There’s a paradox here,” Little Hoover Commission Executive Director Stuart Drown said in an interview. “The more people the state gets to file claims, the greater the backlog becomes.”

Federal backlog

The system for claiming benefits is simple, at least in theory.

Local agencies help a veteran prepare his/her claim, then forward it to the state; which reviews and then submits the claim to the federal Department of Veterans Affairs, which approves or denies the benefits.

Naturally, the process is muddled and lengthened at each step by structural inefficiency, understaffing and confusion.

Earlier this year, the Center for Investigative Reporting, in a report about the federal Department of Veterans Affairs, said “the agency’s ability to quickly provide service-related benefits has virtually collapsed under President Barack Obama.”

The Obama administration attempted to improve the backlog by computerizing processing and hiring more staff. But as the CIR showed, those initiatives “have fallen apart in the implementation.”

In fact, the national average wait-time for benefits is 349.6 days. Meaning the average veteran waits nearly a year before receiving benefits that are considered a right. The average wait times in Los Angeles and Oakland are significantly worse than the national average, at 619.4 days and 617.8 days, respectively.

Many of the delays are caused by veterans who simply fail to fill out the forms correctly. To its credit, CalVet is already working to alleviate the problem.

According to Tremblay, the department will send out strike teams by the end of September or the beginning of October to ensure that all forms are “fully developed,” or correctly filled-out.

Tremblay says the temporary strike teams — 36 people set to work for three years — have “more than enough time to take care of it and deal with the backlog.”

After all, the commission argued that, despite the federal government’s failings, California could still greatly improve its wait times.

The report concluded, “California can do better, and to honor those who have sacrificed for the many, it must do better.”