States Shift Medical Costs to VA by Identifying Overlooked Vets

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States Shift Medical Costs to VA by Identifying Overlooked Vets

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OLYMPIA, WA — As the tepid economy puts a vise on spending nationwide, state governments are searching for ways to take the pressure off their treasuries.

A method that has been used to great success in Washington and is finding traction in other states is to identify veterans on Medicaid who are eligible for military or veterans benefits and make sure they are receiving everything to which they are entitled.


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Just last month, Michigan Gov. Rick Snyder listed as one of the cornerstones of a comprehensive health plan helping veterans in his state access VA benefits. California and Maryland already have similar programs in place, and Texas is in the process of developing one.

In some ways, the programs are win-win. Millions in dollars are saved  by the states, which splits the tab for Medicaid with the federal government, as more care is being paid for solely by VA or TRICARE. Another benefit, and some argue the most important one, is that states are helping to locate and inform veterans about the benefits of VA care — something that has been a challenge for the VA.

On the other hand, it is not clear that VA, which has had problems with budget projections in the past, would not be able to accommodate a significant increase in veteran patients without an influx of more funds.

Beginning With One Veteran

It began about 10 years ago with a visit from a military widow, according to  Bill Allman, manager of the Washington State Department of Social and Health Services’ (DSHS) Veterans Benefit Enhancement Project.

Michigan Gov. Rick Snyder listed as one of the cornerstones of a comprehensive health plan helping veterans in his state access VA benefits

“A client, an older woman, came in to speak to a supervisor,”  said Allman, who was working as a supervisor for long-term care eligibility in the state’s Medicaid office.  “She wanted to know about a bill she received from the state recovery unit — the unit that recovers state liens on homes.”

Her husband, now deceased, had been placed in a long-term care program. DSHS had extended funds to help pay for that care with the understanding that the money would be paid back. To ensure that repayment, the woman had signed papers agreeing to a lien being placed on her home.

She showed Allman a bill for $70,000 — all the DSHS money that was spent on her husband’s care before he died. She said that she was more than willing to pay it back, but she wondered whether DSHS knew that her husband had military benefits and if those were factored in when the $70,000 was tallied.

“I didn’t have anything in the computer system that stated he was a veteran, and she didn’t know what benefits he had, because he had taken care of everything,” Allman said. “Come to find out, he was a retired colonel, and he had TRICARE coverage as a retiree, which is about as good a kind of medical coverage as you can get.”

The wife did not know about the benefits, which would have covered virtually all of her husband’s care if it had been applied instead of Medicaid, and would also have covered her medical care.

“We negotiated with the folks in state recovery, and they whitewashed the bill. And we knew we should do a better job of figuring out who these people are so we don’t find ourselves in this situation again,” Allman said.

Allman said he had been struggling with how to ascertain how much in VA and DoD benefits his clients were receiving and wondered if he could access a database with that information. The widow’s visit helped solidify just where the gaps in data were and motivate him to get answers.

Maximizing Benefits

The project grew in increments. The first thing Allman did was set up a program to regularly interface with DoD.

“We match all our public assistance clients against the DoD on a quarterly basis and compare our clients with TRICARE clients,” Allman said. That way, what happened to the widow would not happen again, at least not through lack of data sharing.

“The sheer numbers of TRICARE enrollments we’ve seen in our project show that we haven’t done a very good job capturing that at the interview,” Allman said.

To do the same for veterans, Allman began using the Public Assistance Reporting Information System (PARIS) — a database of all Medicaid clients designed to catch welfare fraud. The database told Allman which Medicaid clients were veterans. Armed with that information, Allman began working with the Washington Department of Veterans Affairs to locate those veterans and see if they were receiving all of the VA benefits for which they were eligible.

The program prioritizes clients in long-term care because of the cost involved and the possibility of the state initiating recovery efforts.

“We want to maximize the benefits they’re receiving,” Allman said. “If you go into a VA nursing home and you’re receiving a pension from VA for $1,500 a month, your pension drops to $90, because VA figures you only need money for personals and incidentals and that the state could pick up the rest of the cost.”

Many veterans who transition out of nursing home into assisted living, adult family homes or back to their own home, however, do not inform VA, and their pension never increases back to its usual amount.

“You’ve got to let the VA know you’re leaving nursing home care, so they’re aware of that,” Allman said. “We send all that information to the state VA and inform them, and they help get these clients’ pensions bumped back up.”

The Veterans Project also looks for veterans who are in need of third-party insurers to cover their medical costs — an extra amount of money each month known as Aid and Attendance — and who are using Medicaid as that insurer. The PARIS database shows Allman clients who are receiving something from VA, but not Aid and Attendance.

“We usually send VA anywhere from 60 to 70 of these clients a quarter,” Allman said.

These kinds of cases are processed by VA much more quickly than a new application, Allman said. “These are already open cases, and they take a much shorter period of time — on average, about three months, as opposed to a year.”

An effort is made to  focus on Vietnam-era veterans suffering from particular ailments. Looking at diagnostic codes in the Medicaid system, the Veterans Project isolates those with certain conditions, such as type 2 diabetes and any of 16 types of cancer, that have been linked to exposure to Agent Orange.

A Vietnam veteran himself, Allman noted that “VA doesn’t do a really good job of campaigning in the media to tell Vietnam veterans about Agent Orange and, if they have a condition linked to exposure, how they get 100% disability and VA medical [care] for the rest of their lives.”

What he would most like, Allman said, is access to the entire list of honorably discharged veterans who aren’t receiving anything from VA. “That’s the Holy Grail,” he said.

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