The Department of Veterans Affairs has chosen several long-term-care giants as providers in its first-ever consolidated multistate contracts for community nursing home care.
Contracts with Beverly Enterprises, Vencor, Sun Healthcare Group, Genesis Health Ventures, Integrated Health Services, Unicare Health Facilities and Harmony will give the VA access to 1,100 nursing homes in 43 states. Six hundred of those facilities would be providing care to VA patients for the first time.
Except for Harmony, which has 20 facilities in California, the companies all own nursing homes in more than one state.
In addition to operating more than 130 nursing homes with more than 15,000 beds, the VA spends $356 million a year on 3,200 locally negotiated community nursing home contracts to care for 9,000 veterans.
Those veterans can receive care in the community nursing homes if the VA cannot provide a bed in its own facilities nearby or if the veterans wish to remain near their homes and a bed is available in a nearby nursing home that accepts the VA's reimbursement rates.
In signing the contracts with the seven long-term-care companies, the VA expects to see some savings because of reduced paperwork and lower rates negotiated as a major healthcare payer.
But because there will be a transition from the existing community nursing home contracts, the VA cannot say how much it will save or how much it will spend on care under the new contracts.
The VA expects to spend $2.7 billion on long-term care in fiscal 1996, which ends Sept. 30.
Kenneth Kizer, M.D., the VA's undersecretary for health, said the contract also will be an opportunity to improve quality of nursing home care for veterans.
The VA will conduct its own inspections of nursing homes providing care under the contracts, using the same regulations that HCFA uses.
"If quality goes down in a single home, the whole contract is potentially at risk," Kizer said. "My intent would be to use (the consolidated contracts) as a lever to drive more consistent quality."
The announcement of the contract awards comes while the VA makes other moves to streamline and integrate its 700-facility system.
VA medical centers in Tuskegee and Montgomery, Ala., are merging under unified management. Both facilities serve the same patient populations and share many services but provide different types of care. Montgomery is a primary- and secondary-care facility, while Tuskegee is a long-term, rehabilitative and psychiatric-care facility.
In addition, in the next 12 to 18 months, the VA hopes to roll out new information system capabilities in all its facilities that will integrate record-keeping, patient referrals, pharmacy orders, office automation and numerous other functions in a single system.
The information system now links the headquarters of all 22 networks with the Washington central office, as well as some of its medical facilities.