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GAO was requested to provide information on the Veterans Administration's (VA) contract hospitalization program. The review was made to evaluate the VA procedures for transferring patients from public and private hospitals to VA health care facilities and identify areas where savings can be achieved. The contract hospitalization program, in addition to other fee basis medical programs, is administered primarily by 80 VA medical centers which have been designated clinics of jurisdiction for this purpose.

GAO found that VA clinics of jurisdiction did not routinely know when veterans in non-VA hospitals had stabilized enough to be moved to a VA facility. Physician-to-physician contact is necessary to effectively monitor the medical condition of veterans in contract care hospitals. VA clinics of jurisdiction and other VA facilities did not effectively coordinate veterans' transfers to available VA beds once they learned that it was medically feasible to move them. VA clinics of jurisdiction did not always publicize the transfer policy of VA to promote its acceptance by the veteran population and contract health care providers. Based on the 12 clinics of jurisdiction reviewed, GAO found that 8 were using administrative clerks to monitor the condition of veterans in non-VA hospitals.