Residents of the Southern Nevada State Veterans Home collectively owe more than $1 million to the Nevada Department of Veterans Services — a debt that has not yet been collected amid a lack of communication between state agencies, but that the department insists is not undermining services to the nursing home’s residents.

The more than $1 million owed to the state came to light via a recent state audit revealing that residents of the veterans home in Boulder City have an outstanding balance of nearly $990,000 as of the end of the 2024 fiscal year, with some of that debt extending back more than six years. Additional records from the Nevada State Controller’s Office show more than $550,000 in collectible debt owed to the division from the state’s two veterans homes was accumulated between 2004 and 2013.

The Nevada Department of Veterans Services, which operates the home, declined an interview request from The Nevada Independent, citing scheduling challenges. Department officials wrote that the agency “welcomes these internal audits.”

Asked whether any veterans are at risk of being kicked out of the home because of unpaid bills, department spokesperson Terri Hendry wrote that the department cannot comment on any specific case, but implementing the audit recommendations “will render this question moot.”

“We want to make clear, at no time were services to residents at the SNSVH impacted nor will services be impacted now or in the future as we move forward with implementation of the internal audit’s recommendations,” Hendry wrote.

The state-owned and operated Southern Nevada State Veterans Home provides 24/7 nursing care and has about 180 beds, offering various services, including memory care, physical therapy, rehabilitation and palliative and hospice care, at a lower rate for residents than other skilled nursing homes.

In 2024, it had more than $25 million in operating expenses. That year, it reported revenue of more than $40 million, consisting largely of patient collections, Medicaid charges and VA reimbursements.

Most of the residents' expenses are paid for by Veterans Affairs, with the share of the cost varying by year and type of service at their discharge. Private payers at the home pay a fixed rate of $125 per day.

During an October Executive Branch Audit Committee meeting, Veterans Services Director Mary Devine, who became director last March, said most of the debt had accrued because of issues surrounding patients enrolling in Medicaid, which can cover patients’ medical expenses. She promised to take a “really more proactive look at our admissions process and our collection process with both our finance and accounting team.”

But being unable to collect the money could hinder the types of services the Department of Veterans Services could provide, said James Smack, chief deputy controller in the Nevada State Controller’s Office. The office is responsible for administering the state’s accounting system and collecting debts owed to the state. 

Before the controller’s office can collect the money, however, Smack said the veteran services department needs to authorize the office to do so formally.

“Veterans Services has not turned any debt over to our office since 2013,” he said, noting that he was not aware of the outstanding debt until The Nevada Independent reached out to him about the figure. 

“I'll be paying a little bit more attention to this now that it's been brought to my attention,” Smack added. 

Most of the debt has been accrued by residents who never pursued or obtained coverage under Medicaid after receiving needed care, patients who were denied Medicaid coverage after incurring costs, residents who lost their Medicaid eligibility status because they no longer met the requirements and residents who received care and were approved for Medicaid but did not receive retroactive coverage. 

Under Medicaid, states are required to respond to an application within 45 days. If an application involves a disability, that response could take as long as 90 days. The audit noted that this process can become more drawn out for patients living in a state veterans home because residents only become eligible for Medicaid coverage after living in the facility for 30 consecutive days. 

Along with potentially needing to send updated documentation or other information that can delay the approval process, the audit added that obtaining Medicaid coverage can take more than a year to finalize, leading to a growth in unpaid medical bills.

The longer the debt has been in place, the less likely it is to be collected, said Smack. At more than 24 months, he said the probability of collecting debt goes down about 10 percent, and the probability continues to decrease over time.

Part of the issue with the department’s uncollected debt, Smack said, is that the most recent agreement between the department and the state controller’s office about when to collect debt is from at least nine years ago. 

Devine said during the audit meeting that agency staff have taken steps, including calling residents' families to help collect the debt. Still, she said it’s complicated by closed bank accounts, credit card switching and promises that checks are in the mail. 

Devine said that the state home’s accounting team was not aware that they needed to submit past due balances or unpaid Medicaid-denied bills to the department or the controller’s office. In response to emailed questions about how the bills were allowed to stack, a department spokesperson wrote that “The audit clarified the process for disposition.”

Following the audit, Devine said staff learned there was recourse to recover the funds, which would go directly to the division.

Along with assigning the debt to the state controller’s office for collection, state audit officials recommended the department update its memorandum of understanding with the controller’s office.

They also suggested following better accounting principles, such as having prepayments from residents in the home credited to accounts receivable and revising admissions applications to include Medicaid information, submitting a Medicaid application at the start of the admissions process and training staff on updated admissions processes to limit misunderstandings with residents to the home.

Smack said the department has contacted his office to begin setting up a new memorandum.

“That's great for stuff going forward. But what happened? When are we going to see any debt from the last 10 years?” he asked.