Oklahoma Department of Veterans Affairs requests $23M in combined baseline and capital start-up to address rising care costs and deferred maintenance

An Oklahoma Department of Veterans Affairs presenter (name not provided in transcript) told legislators the agency is asking for a baseline adjustment of about $16 million and a $7 million capital improvement re-request to begin addressing deferred maintenance and recapitalization needs across the veterans homes enterprise.

The presenter said the Sallisaw veterans home (175 beds) recently opened and the agency expects a VA recognition survey that will permit day-for-day VA fee-for-service payments. He described a significant enterprise throughput — more than $200 million annually — while state appropriations have historically been about $40.14 million. The presenter said the state’s contribution pays roughly half of the non-VA operating baseline and that rising fully burdened costs had driven the request: "It costs us about $15,000 a month to run the enterprise and that's fully burdened, per veteran," he said.

ODVA reported that replacing older homes and matching VA capital funds is constrained because prior COVID-era spending reduced available matching dollars; the presenter said the agency is about $30 million short of full matching capacity for a planned Ardmore replacement and estimated deferred maintenance and recapitalization needs at about $255 million.

The agency described operational reforms: converting costly contract labor to state employees and saving an estimated two-thirds of previous agency labor premiums, centralizing procurement, and pursuing fundraising channels (an Oklahoma Veterans Foundation and Veterans Assistance Fund) to reduce reliance on annual appropriations.

Lawmakers asked detailed questions about supervisory FTE counts, occupancy rates, VA and CMS certification differences, and whether the agency could bill Medicaid or Medicare; the presenter said current homes are VA-certified (not CMS-certified) and that some CMS certification efforts will be targeted (Sallisaw first) but VA rules restrict how funds and patient mixes are co-billed.

The agency requested committee guidance on policy language that would allow more operational flexibility and oversight requirements for donated or nonappropriated funds. Committee members asked for follow-up data on occupancy, FTE composition and the proposed fund structures.