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HEHS-95-252R 1 (1995-09-12)

handle is hein.gao/gaobackya0001 and id is 1 raw text is: GAO United States General Accounting Office Washington, D.C. 20548 Health, Education and Human Services Division B-265811 September 12, 1995 The Honorable John McCain United States Senate Dear Senator McCain: At your request, we are currently reviewing the Veterans Health Administration's (VHA) process for allocating the medical care appropriation to its medical facilities across the nation--the Resource Planning and Management System (RPM) .1 Historically, VHA allocated resources by making incremental changes to each facility's prior year budget. After recognizing the need to better link resources to each facility's actual workload, VHA in 1985 implemented the Resource Allocation Methodology (RAM). VHA officials indicated that because the RAM allocations were generally based upon workload as defined by clinical diagnoses, facilities soon recognized that their allocations would be increased as the number of procedures performed increased. This open-ended expansion of workload led to budgeting problems and concerns about inappropriate care being provided. RPM--first used to allocate fiscal year 1994 facility budgets--was intended to improve upon past allocation systems. VHA's stated goals for RPM are to (1) improve VA's resource allocation methodology, (2) move from retrospective to prospective workload management, and (3) reform medical care budgeting. Accordingly, RPM was designed to be patient-based, forward-looking, and policy-driven. It defines workload as patients served, rather than procedures performed--hence, VHA's characterization of RPM as capitation-based --and it uses projections of future workload to determine what resources are needed. A VHA strategic plan was also intended to be the driving force 'For fiscal year 1996, the Department of Veterans Affairs (VA) is seeking an appropriation of about $17 billion to maintain and operate 173 hospitals, 376 outpatient clinics, 136 nursing homes, and 39 domiciliaries. GAO/HEHS-95-252R VA Medical Resources Allocation System / 5YA Z7-

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