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STATEMENT OF
THE HONORABLE TIM MCCLAIN
GENERAL COUNSEL, DEPARTMENT OF VETERANS AFFAIRS
BEFORE THE
COMMITTEE ON VETERANS' AFFAIRS
UNITED STATES SENATE
July 29, 2003
Good afternoon Mr. Chairman and Members of the Committee.
I am pleased to be here to present the Administration’s views on six bills that pertain primarily to the veterans health-care system.
S. 1156
Mr. Chairman, I will begin by addressing S. 1156, your omnibus health-care bill. It includes provisions pertaining to long-term health care in VA, personnel matters, authorization for construction of two major medical facilities, and permanent authorization of the Veterans Benefits Administration to obtain disability examinations on a contract basis.
Long-Term Care Provisions
In 1999, the Congress made significant changes in our long-term-care programs through enactment of what we commonly refer to as “The Millennium Act.” Among other things, that law directed that VA “shall” furnish nursing home care to any veteran needing such care for a service-connected disability and to any veteran with a service-connected disability rated at least 70 percent. It also directed that VA include various non-institutional extended care services in the medical benefits package. At the time of enactment, the impact both provisions would have on VA was uncertain, and Congress chose to limit their applicability to the four-year period ending December 31st of this year. Section 101 of your bill would extend the provisions for an additional five years throughDecember 31, 2008 . That section would also extend the requirement that we furnish needed nursing home care to all veterans with service-connected disabilities rated 50 or 60 percent.
The Department’s view is that it would be premature at this time to extend the two Millennium Act provisions for five years. As you know, we provided the Congress with a report on implementation of the Millennium Act in March. We are continuing to gather information and will provide the Congress with an additional report later this year. That report, and other actuarial analyses, will provide data that will aid VHA leaders and Congressional policymakers in determining appropriate longer-term directions for development of VA long-term care services. Accordingly, we recommend only a one-year extension at this time.
We are also concerned about extending so-called “mandatory” nursing home eligibility to all veterans with service-connected disabilities rated at least 50 percent. We estimate that the change from 70 percent to 50 percent would cost $2.5 billion over 5 years and has not been planned for in the budget process. As a result, the provision could have serious unintended consequences including slowing the rate of growth of non-institutional long-term care services and reducing the availability of services for non-mandatory categories of veterans because of competing priorities for limited resources. We recommend that the Committee defer any such change in law until further data about VA’s experience under the Millennium Act are available to better inform its decision. We also believe State homes should be included in the options available to these severely disabled service-connected veterans. State-home care should be made available to these veterans without out-of-pocket cost. We would like to work with the Committee to develop the necessary legislation.
Section 102 of your bill would amend existing law to clarify that we have authority to provide veterans with nursing home care and adult day health care in private community nursing homes and other facilities using agreements for reimbursement similar to those used under the Medicare Program. That approach would differ from our current practice of providing such care only through actual contracts with the nursing homes or providers of adult day health care. To implement the authority, the Department would have to promulgate regulations to establish a program to directly reimburse the community facilities on behalf of veterans for the care furnished. The regulations would include all of the parameters for the program, including amounts VA would pay for various types of care, and the standards that facilities would have to meet to receive VA reimbursement. In many respects, the parameters for the program could mirror those now used in the Medicare Program. We do not object to section 102 as an alternative approach to assist us in meeting the needs of veterans for nursing home care and adult day health care in non-Department facilities.
Construction Authorization
Section 201 of the bill would authorize construction of a long-term care facility in Lebanon , Pennsylvania , in an amount not exceeding $14,500,000 and a long-term care facility in Beckley , West Virginia , in an amount not to exceed $20,000,000. We would point out that the cost for the project in Beckley is now estimated to be $20,800,000. We generally support these projects in concept and we will be considering them in the context of future budget preparations.
Mr. Chairman, the President’s fiscal year 2004 budget included a request for authorization for a major construction project at Chicago (West Side ), Illinois for a new inpatient tower; outpatient clinic leases in Boston , Massachusetts and Pensacola , Florida ; and a lease for the Health Administration Center in Denver , Colorado . In addition we requested an authorization for an outpatient lease in Charlotte , North Carolina that received an appropriation in FY 2002. We ask that you act favorably on those requests, as well as those seismic projects that were listed in the President’s FY 2003 budget. The facilities at Palo Alto , San Francisco , and West Los Angeles remain as a critical risk to the safety of patients and staff in the case of seismic events and those projects remain a high priority for the Department. We are confident that the CARES studies will validate the continued need for these major facilities. In addition, we request authorization for a health care facility in Las Vegas to replace the existing clinic that we were required to vacate on July 1st because of structural inadequacies in the building. It is important that the Department be provided this authorization so we will be able to move forward next year.
Personnel Provisions
S. 1156 also contains four separate sections that address personnel matters. The first provision, section 301, would amend existing law to add a significant number of mission-critical, scarce, skilled health care positions, such as dietitians, medical technologists, and medical records administrators/specialists to the current list of title-38 hybrid positions. We support the goals of increased flexibility in staffing these positions because of today’s fierce competition for qualified candidates (particularly those who possess skills acquired in primary care settings), market-wide shortages in these health care occupations, and VA’s aging health care work force. We are currently considering a similar proposal to increase flexibility in staffing these positions, and the Office of Personnel Management recently issued interim final regulations greatly expanding availability of direct hire authority for critical need or shortage situations. We are examining whether or not we need legislation given these brand new regulations, and will work with Congress to reconcile if we do.
In the past, we have not been able to quickly and efficiently recruit candidates. Our inability to consistently make timely job offers is a chief reason why the Department is experiencing hiring difficulties. These difficulties can adversely affect access to care for many of our veterans. Second, the delays cause many qualified candidates to forego consideration of VA employment. With multiple job opportunities in hand, they turn to the private sector where the hiring process is more responsive.
Section 302 of the bill would amend the law establishing the Veterans Canteen Service (VCS) to permit persons employed by VCS to be considered for competitive service appointments in the Department in the same manner that Department employees in the competitive service are considered for transfers to competitive service positions. Currently, VCS Management Program employees may be appointed to positions in the competitive service under an interchange agreement between the Department and the Office of Personnel Management (OPM). Section 302 would authorize a similar interchange agreement for non-managerial VCS employees. It would authorize all VCS employees to transfer into a competitive service position. Time served in the Canteen Service would count toward the 3-year service requirement for career civil service status.
The Administration does not support section 302 because it believes that establishing eligibility for the non-competitive conversions of VCS hourly employees into competitive service positions would provide an unfair advantage over excepted service employees from other Departments and agencies seeking appointment to competitive service positions at VA.
Section 303 of the bill would retroactively apply recently legislated changes to the method of computing retirement annuities for certain VA health-care personnel who are already retired. The Department of Veterans Affairs Health Care Programs Enhancement Act of 2001 prospectively changed the way part-time service performed before April 7, 1986 , by certain VA health-care personnel is credited for annuity purposes. Section 303 would extend this change to individuals who retired before the effective date of enactment. Traditionally, retirement benefit changes have been applicable only to individuals retiring after enactment of the change. This change would recreate a very expensive precedent for government-wide application of the principle of retroactivity in retirement cases involving part-time service. Consequently, the Administration strongly opposes this provision, as it would impact retirement fund outlays and have a PAYGO cost not contemplated in the President’s Budget
Section 304 of S. 1156 would broaden the authority of the Veterans Benefits Administration to contract with outside entities for disability examinations in connection with the adjudication of claims for veterans benefits. Current law allows VBA to do so at no more than 10 regional offices on a pilot basis. Section 304 would remove the 10-office limitation. The pilot has been a success, however, there are funding issues and we do not yet have cleared views and estimates on this provision. We will supply them when they are available.
S. 613
S. 613, the Veterans’ New Fitzsimons Health Care Facilities Act of 2003, would authorize us to carry out major medical facility projects at the former Fitzsimons Army Medical Center in Aurora , Colorado . The bill would provide us with flexibility in selecting the projects by providing that they may include acute, sub-acute, primary, and long-term care services. It would limit project costs to an amount not to exceed $300,000,000 if a combination of direct construction and capital leasing is selected and no more than $30,000,000 per year in capital leasing costs if a leasing option is selected. In addition, the bill places certain limitations on the fiscal years from which appropriated funds can come.
Mr. Chairman, we support the intent of this provision of S. 613. We have been involved in evaluating and planning for a facility for the Fitzsimons site and there is a potential for a joint venture with DOD to provide health care to both veterans and DOD beneficiaries. Many issues still remain including the availability of land, but VA would be able to provide the report to Congress within 120 days as required if the bill is enacted.
I also note that Section 3 of S. 613 would require the secretaries of Veterans Affairs and Air Force to undertake such joint activities as they deem appropriate to address the health care needs of veterans and active duty Air Force members. We have no objection to this provision.
S. 1213
S. 1213, a bill entitled the “Filipino Veterans’ Benefits Act of 2003,” is the Administration’s bill that you introduced on our behalf. I want to express my sincere appreciation to you for introducing the measure. As you know, section 2 of the bill would extend health care benefits to Filipino veterans residing legally in the United States who served in the Commonwealth Army and new Philippine Scouts. I urge that you act on the bill as expeditiously as possible so we can meet the needs of these very deserving Filipino veterans.
S. 615, S. 1289 and S. 1144
S. 615 would designate the outpatient clinic located in Horsham , Pennsylvania , as the “Victor J. Saracini Department of Veterans Affairs Outpatient Clinic”. S. 1289 would designate the Minneapolis VA Medical Center as the Paul Wellstone Department of Veterans Affairs Medical Center. S. 1144 would designate the facility in Chicago now known as the West Side VA Medical Center as the “Jesse Brown Department of Veterans Affairs Medical Center”. While we ordinarily defer to the views of Congress on the naming of Federal properties, in the case of former Senator Wellstone and former Secretary Jesse Brown we make an exception. Enactment of S. 1144 and S. 1289 would be an altogether fitting tribute to these two truly courageous and steadfast advocates for America ’s veterans.
S. 1283
S. 1283 would impose new Congressional notice-and-wait requirements on VA before we could take any action to implement our Capital Asset Realignment for Enhances Services (CARES) decisions. The bill would prohibit VA from taking a proposed action for 60 days following submission of advance written notice of the action to Congress, or before 30 days during a continuous session of Congress.
Mr. Chairman, we must object to enactment of this bill. As drafted, the bill is overly broad, unnecessary, and would significantly impede our completion of the CARES process. By stating that VA must provide prior notice of “any action,” apparently including even minor actions, the measure would effectively prevent completing the CARES process in anything like a timely manner. I can assure you we will provide Congress and this Committee with our CARES plan well in advance of undertaking significant actions to implement it. Congress will have considerable lead-time to consider our proposed actions before they are undertaken.
I would also point out that we are already subject to various existing notice-and- wait requirements that serve the same purpose as that intended by this legislation. We currently provide such advance notice under section 510 of title 38 whenever we undertake a significant reorganization of any office or facility. Congress must also approve in advance any significant construction project, and we provide Congress with advance notice of any proposed enhanced-use leases. The additional requirements this bill would impose are therefore unnecessary.
The Administration’s Physicians and Dentists Pay Bill
Finally Mr. Chairman, on July 18th, we delivered to the President of the Senate and the Speaker of the House of Representatives the Administration’s draft bill “to simplify and improve pay provisions for physicians and dentists, to authorize alternate work schedules and executive pay for nurses.” This very important bill will greatly improve VA’s ability to recruit and retain the highest quality physicians and dentists to treat the Nation’s veterans. It would completely revise the VA physician and dentist pay system to allow VA to adjust compensation according to market levels. The draft bill would also reduce the potential for conflicts of interest at the Department’s affiliated facilities by prohibiting senior clinician managers at the Chief of Staff level and above from receiving any compensation from the medical schools affiliated with their respective facilities. Finally, the bill would enhance the Department’s ability to recruit and retain nurses by permitting the use of alternate work schedules and by authorizing special pay for VA nurse executives.
This bill is critical to the Department’s ability to recruit and retain the highly skilled medical professionals we need to care for our veterans. I offer to work with you and the Committee to get this very important legislation passed as expeditiously as possible.
That concludes my prepared statement. I would be pleased to answer any questions you may have.
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