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C O N T E N T S
July l9, 2010

Serving Virginia’s Rural Veterans

OPENING STATEMENTS

Chairman Michael H. Michaud
    Prepared statement of Chairman Michaud

WITNESSES

U.S. Department of Veterans Affairs:
    Patricia Vandenberg, MHA, BS, Assistant Deputy Under Secretary for
        Health for Policy and Planning, Veterans Health Administration
            Prepared statement of Ms. Vandenberg
    Daniel F. Hoffman, FACHE, Network Director, Veterans Affairs Mid-Atlantic Health
        Care Network, Veterans Integrated Services Network 6, Veterans Health Administration
    Carol Bogedain, MS, RD, CPHQ, FACHE, Interim Medical Center Director, Salem Veterans
        Affairs Medical Center, Veterans Health Administration

American Legion, Michael F. Mitirone, Commander, Department of Virginia
    Prepared statement of Mr. Mitrione
DaVita, Inc., Kevin Trexler, Division Vice President
    Prepared statement of Mr. Trexler
Disabled American Veterans, Clarence Woods, Commander, Department of Virginia
    Prepared statement of Mr. Woods
Southwest Virginia Community Health Systems, Inc., Howard Chapman, Executive Director, and Member, Virginia Community Healthcare Association
    Prepared statement of Mr. Chapman
Thackston, Major General Carroll, USA (Ret.), Mayor, South Boston, VA, and Former Adjutant General, Virginia Army National Guard
    Prepared statement of General Thackston
Tucker, Lynn, Museville, VA
    Prepared statement of Ms. Tucker
Veterans of Foreign Wars of the United States, Daniel Boyer, Post Commander, Grayson Post 7726, VFW Past State Commander
    Prepared statement of Mr. Boyer

SUBMISSION FOR THE RECORD

Halifax Regional Health System, South Boston, VA, Chris A. Lumsden, Chief Executive Officer, statement

SERVING VIRGINIA’S RURAL VETERANS

Monday, February 14, 2010
U. S. House of Representatives,
Subcommittee on Health,
Committee on Veterans' Affairs,
Washington, DC.

The Subcommittee met, pursuant to notice, at 9:00 a.m., at the Bedford County Board of Supervisors Meeting Room, County Administration Building, 122 East Main Street, Bedford, Virginia, the Hon. Michael H. Michaud [Chairman of the Subcommittee] presiding.

Present:  Representatives Michaud and Perriello. 

OPENING STATEMENT OF CHAIRMAN MICHAUD

Mr. MICHAUD.  I'll call the Subcommittee on Health of the Committee on Veterans' Affairs to order, and I'd ask the first panel to come up. 

First of all, I'd like to thank everyone for attending this hearing, especially the veterans who are here with us today.  I would also like to express my sincere gratitude to the Bedford County Board of Supervisors for their hospitality in hosting this hearing. 

Today's hearing would not have been possible without Mr. Perriello's tireless advocacy for veterans living in Virginia.  He is a welcomed Member of the Subcommittee on Health of the Committee on Veterans' Affairs.  He also brings a new energy and enthusiasm for tackling the unique challenges facing veterans.  I really got to know Mr. Perriello when we took a trip to Afghanistan together to learn more about the health care provided to the men and women who are wearing the uniform so proudly.  And as Chairman of the Subcommittee and a representative of rural communities in the State of Maine, Mr. Perriello and I share an interest in making sure our rural veterans receive the care they deserve. 

Our veterans, whether they live in rural Maine or rural Virginia, face common challenges.  Most notably, access to care is an issue for veterans living many miles or hours away from the closest U.S. Department of Veterans Affairs (VA) medical facility.  Given these challenges, it is important that our rural veterans have access to health care. 

When you look at access to health care, there are many tools out there that can help, such as telemedicine, telehealth and VA's new pilot program that provides enhanced contract care. 

This year we held several important hearings focused on rural health.  For example, this past April we held a hearing on VA's implementation of the Enhanced Contract Care Pilot Program.  To our surprise, we learned the VA planned to create pilot programs within the Veterans Integrated Service Networks (VISNs), that were selected under the original legislation, VISNs 1, 6, 15, 18 and 19. 

At this hearing in April, we made it clear that Congress's intent was to have VA implement this pilot program VISN-wide within those VISNs.  And when you look at the scoring that was provided by VA to the Congressional Budget Office (CBO) on how many veterans would be affected by that program, these scores indicated that it would be VISN-wide. 

Unfortunately, we just were informed a few days ago that VA does not plan on honoring Congress's intent and will only be implementing a pilot program in selected locations within the VISNs.  I'm deeply concerned about this recent development and look forward to hearing from the VA today on this very important issue. 

Next, in June of this year we held a hearing on innovation of wireless health technology solutions as a way to help overcome rural health care challenges.  At this hearing, we heard from the Director of Rural Network Development in the University of Virginia Health System, who provided testimony on the unique needs of veterans of the Appalachia and the importance of innovation in telemedicine and wireless mobile health applications. 

Again, I want to thank Mr. Perriello for inviting us here today, and I appreciate this opportunity to hear directly from the veterans of Central and Southern Virginia about their local health care needs.  I look forward to the testimony of the different panels we have here today. 

Once again, I want to thank Mr. Perriello for all that you have done and are doing for our veterans across this Nation and in your State of Virginia.  I would now turn it over to you for your opening statement and also to introduce the first panel. 

[The prepared statement of Chairman Michaud appears in the Appendix.]

OPENING STATEMENT OF HON. THOMAS S.P. PERRIELLO

Mr. PERRIELLO.  Thank you very much, Mr. Chairman.  I really appreciate the sacrifices you've made to come down here and be part of this, and also to the Committee counsel, both the Democratic and Republican Committee counsel present.  The four of us did travel together to Afghanistan, not only to look at the security situation, but to look at the seamless transition or how to create a more seamless transition from the forward operating bases through our holding hospitals and back into the VA system.  Far too many are lost within those seams, as we all know. 

We've made dramatic advances in battlefront medicine since the Vietnam and prior ages, which means we're able to keep a lot of soldiers and airmen alive that would not have survived before.  That also means we're seeing a complexity of physical and emotional issues back on the home front once they have returned. 

And one of the things that I want to thank in particular—and the community here across Central and Southern Virginia has been great on this—is that in previous eras sometimes within the veteran service organization community, we have seen generational battles, one set of veterans against another.  We have seen an unbelievable unity of veterans of—to make sure that we are doing everything we can with our returning Office of Enduring Freedom (OEF) and Operation Iraqi Freedom (OIF) vets, and I think it's a testimony to the veterans service organization (VSO) community and the unity across generations that we have been able to respond in such a dramatic way, still much more to be done, to make sure that those folks, as they're coming back, are getting the best care that they can.  And again, I think everyone here up in diocese has been interested in understanding that. 

As Mr. Michaud noted, he and I both represent quite rural districts with high degrees of patriotism and service through our armed forces.  And one of the things that he and I both advocate heavily is trying to get more of the health care to the veteran instead of just the veteran to the health care, ways that through telemedicine, through primary care within our communities, which we'll hear a lot about today, through community-based outpatient clinics (CBOCs), and other ways we can try to get services to veterans instead of putting the burden on them. 

This hearing in many ways is another example of that.  We want to get out in the field to make sure that we're making it as easy as possible to bring the Committee's processes to the veterans instead of veterans always having to come up to Washington to do so, though many of you have given up your time on that front.  So we wanted this hearing—I wanted this hearing here in Bedford because, of course, no community has given more in terms of sacrifice.  The great tradition of the Bedford Boys and the wonderful D-Day memorial that's here, even with the controversy that's unfortunately going on, remains just an unbelievable statement of the—of the events of Normandy and D-Day that should never be forgotten and continue to inspire. 

I remember one of the first programs that I attended up there—I believe it was a July 4th ceremony—hearing the story of a mother who had just lost her son in Iraq, who that son had grown up visiting Bedford and then eventually D-Day Memorial, and that had inspired him to enlist and continue that tradition that we have seen.  So there's so much to be proud of here in Bedford.  But we also see the challenges of course in the system. 

Now, this Subcommittee is on Health.  I just want to make one brief comment about the Economic Opportunity Subcommittee of the Veterans' Affairs Committee that I also serve on, which is simply that the unemployment levels for our returning veterans right now is astronomical.  Some put it at or above 20 percent unemployment. 

So of course as people are coming back, not only might they be facing, say, a foreclosure on their home, their job is not there, challenges in their marriage, because we know what a strain that these extended deployments can put on our military families, perhaps physical and mental challenges as well in the health sector, to also be in an environment where we see not only general unemployment, but we see employers actually resisting hiring veterans.  We hear the tragic stories of a veteran saying they won't even put their service on their resume because employers are concerned whether it's perceptions of post-traumatic stress disorder (PTSD) or perceptions of how quickly people are getting called back up, or seeing various hurdles to veterans getting employment when they should be the first in line. 

So we are working on a number of proposals on that Subcommittee as well, which won't be the immediate focus of this panel, that includes not only the most rapid implementation of Senator—of the GI Bill, modern GI Bill that our own Senator and many others on this Committee fought for, to modernize access to 4-year colleges, but we're also hearing from a lot of veterans that, you know, a 4-year college isn't for me right now, I need to get 12 months of vocational and skills training so I can get a decent wage and support my family, and trying to expand and streamline some of the vocational skills, training programs, some of the hiring programs, to make it more appealing for businesses to hire veterans and other issues.  So those are things we continue to fight on there. 

Here in this Committee again, we are particularly focused today on issues of rural health, and I have been very blessed by the expertise of the people sitting in front of me and many others to talk on a daily basis about the issues that we face in terms of access to care, access to specialty care, costs involved and other things. 

And with that I want us to move to the first panel, and first introduce Major General Carroll Thackston who, in addition to being a former Adjutant General of the Virginia Army National Guard, is also the Mayor of South Boston, Virginia.  He has been a tremendous servant both in uniform and also in the community.  And along with him we have Dr. Roger Browne and Colonel Ted Daniel, both retired military.  Dr. Browne is a general practice doctor in the South Boston area.  Ted Daniel is the Town Manager.  We've also worked together. 

These three gentlemen are tremendous public servants in every sense of the word, and we have worked together extensively on what I think is one of the most appealing, competitive proposals for offering primary care through local facilities.  It's a project that has been painstakingly put together, has tremendous support both from the local medical community, the hospital community, the elected officials and the veterans community, African American, white, young and old in the area, and I think it exemplifies so much what this Committee set out to do with this pilot project, and I'm looking forward to them speaking. 

We also have joining us Howard Chapman, the Executive Director of Southwest Virginia Community Health System and the Virginia Community Health Care Association, to talk some about their experiences, as well as Kevin Trexler, who's the Division Vice President for DaVita, who is going to talk some about dialysis and a number of other issues and ways that some of our private contractors are interacting with the VA system. 

So, with that, I will have more to say in response, but I really appreciate all of our panelists being here to participate, all the work that went into your opening statements and look forward to what you have to say this morning.  I yield back to the Chairman.

Mr. MICHAUD.  We'll start with General Thackston. 

STATEMENTS OF MAJOR GENERAL CARROLL THACKSTON, USA (RET.), MAYOR, SOUTH BOSTON, VA, AND FORMER ADJUTANT GENERAL, VIRGINIA ARMY NATIONAL GUARD; ACCOMPANIED BY ROGER BROWNE, M.D., USA (RET.), SOUTH BOSTON, VA (INTERNAL MEDICINE PHYSICIAN); COLONEL TED DANIEL, USA (RET.), TOWN MANAGER, SOUTH BOSTON, VA; HOWARD CHAPMAN, EXECUTIVE DIRECTOR, SOUTHWEST VIRGINIA COMMUNITY HEALTH SYSTEMS, INC., AND MEMBER, VIRGINIA COMMUNITY HEALTHCARE ASSOCIATION; AND KEVIN TREXLER, DIVISION VICE PRESIDENT, DAVITA, INC.

STATEMENT OF MAJOR GENERAL CARROLL THACKSTON, USA (RET.)

General THACKSTON.  Thank you, Congressman Perriello, Mr. Chairman.  Good morning, ladies and gentlemen.  I'm Carroll Thackston and the Mayor of South Boston, as Mr. Perriello so said.  I have served over 10 years, both as Vice Mayor and Mayor of our town, which numbers about 8,500 in population. 

I'm also a retired Major General of the United States Army, having spent over 40 years, the last 4-1/2 years as the Adjutant General of the Virginia National Guard.  I served on active duty for about 6 years, spent 35 years in the National Guard.  And so with this background I have a good understanding of the National Guard operations, their goals and objectives and the problems, current and future, facing the National Guard.  So my main focus this morning will be about the National Guard and its varying components and its probable impact on the Department of Veterans Affairs. 

As I'm sure you are all aware, the Total Force Policy has been in effect since post-Vietnam and treats the three components of the Army and Air Force, that is, the regular forces, the National Guard and the Reserves, as a single force.  Unlike the impact of Vietnam veterans on the VA system, this total integration and increased reliance on combat and combat support units of the National Guard throughout the 1990s, and the war on terror creates a whole new dynamic for Veterans Affairs. 

So before I discuss some of my concerns about the Guard and increasing impact on the VA, I would like to tell you about our local effort to help veterans of Halifax County and the immediate nearby counties.  For the past 3 years several of us have worked with a small group of local Halifax veterans, primarily Vietnam veterans.  We have worked to establish a primary care facility in South Boston to serve local area veterans.  We have met many times, and we have travelled many miles in pursuit of our goal. 

At this point, we are aggressively seeking designation as a rural locality under the VA's Enhanced Contract Care Pilot Program.  If successful, Halifax Regional Hospital's new primary care facility located in South Boston will serve as a pilot project for contract care within VISN 6.  Our group has also met numerous times with Congressman Perriello, his staff and VA representatives.  We have travelled to Washington and were able to meet with Secretary Shinseki.  And most recently participated in a lengthy teleconference that included Deputy Assistant Under Secretary Vandenberg and numerous VA staffers. 

In January of this year, Dr. Roger Browne, a member of our group, testified during Roundtable discussions of the Committee on Veterans' Affairs on "Meeting the Unique Health Care Needs of Rural Veterans." Dr. Browne is credentialed as a specialist in internal medicine.  He's treated Halifax County veterans for over 30 years, and his personal experience as a brigade surgeon for the 198th Light Infantry Brigade in Vietnam in 1968 and provided our group with the leadership and the credibility to clearly identify the quality of primary health care our veterans need and deserve. 

At the finish line we hope to have a new and modern primary care center in South Boston operating as a VA primary care contractor, providing all Halifax County veterans, both old and young, regular forces, Guard and Reserve, with the quality primary care, medical care that they have earned and are entitled to, both legally and morally. 

There were 1,127 veterans in Halifax County enrolled in the VA system at the end of fiscal year 2009.  There are 2,954 civilian veterans in Halifax County according to the most recent census data.  We want all of them participating in the VA health system, and we want a local facility that is convenient for them and their families.  We want to ensure that our growing population of veterans that are returning from current tours of active duty, are assimilated back into their home communities with the assurance that convenient quality VA medical care is there for them. 

Now, as a former Adjutant General of the Virginia National Guard from June 1994 to October of 1998, I have some deep concerns about the coming impacts of the VA system as a result of the extensive use of National Guard combat and combat support units during Operation Iraqi Freedom and Operation Enduring Freedom in Afghanistan. 

During my tenure as the Adjutant General, in spite of actively seeking overseas operations for our 10 National Guard divisions, the National Guard was more or less relegated to homeland security and domestic crises.  As I'm sure you are aware, this is not the situation the Guard finds itself in post 9/11. 

Let me give you some examples.  In Virginia, we have 7,838 members currently assigned to the Army National Guard, which is 102 percent of our authorized strength.  Since 9/11, 8,862 Army Guard personnel and over 700 Air National Guard personnel have been deployed, 81 Purple Hearts have been awarded to Virginia Guardsman, and ten of our men and women have been killed in action.  There are currently 630 Virginia National Guard and Virginia Air National Guard men and women on active duty. 

If we go to the national scene, the total number currently on active duty from the Army National Guard and the Army Reserve is 90,144.  The Navy Reserve is 6,354, excuse me, the—the Air National Guard and Air Force Reserve, 14,457, Marine Corps Reserve, 4,917, and the Coast Guard Reserve, 787.  This brings the total number of National Guard and Reserve personnel currently activated to 118,659, including both units and individual augmentees.  These figures are current as of July 13.  And when you consider the continuing participation of the war effort since 2001, the total number of National Guard and Reserve numbers is substantial. 

So in conclusion, when we consider the huge influx of citizen soldier veterans created by the increase of Guard and Reserve forces under the Total Concept Policy, and the prosecution of the extensive combat operations in the Middle East, there is an enormous workload headed for the Department of Veterans Affairs.  When you also consider the demands being placed on the Department of Veterans Affairs by the intense combat environment and multiple tours of duty, combined with the efforts to increase VA medical care eligibility for veterans, I believe that the VA will have to expand its network of health care facilities to meet these increased demands. 

News reports last week indicate that the VA is adopting new rules regarding post-traumatic stress disorder that will, in my opinion, drastically increase the clinical workload for the VA.  Reports in this newspaper article cite a 2009 Rand Corporation estimate that nearly 20 percent of the returning veterans or 300,000 have symptoms of PTSD or major depression.  It will be interesting to see how these estimates are updated to reflect the new rules announced last week. 

The education in our group has received in pursuing a contract primary care facility for Halifax County has clearly enlightened us on the tremendous strides that the VA has made since the mid 1990s with the establishment of the VISN and the CBOCs, community-based outreach clinics, but we are absolutely convinced that the VA will need to rely on the numerous professional and highly qualified private sector medical facilities to meet the incoming demands for VA medical health care. 

Expanding the CBOC system may be prudent and wise, but the full utilization of contract medical facilities such as the one in South Boston will be essential to meeting these demands, both on time and on cost.  Our research has shown considerable savings in time and fuel by veterans using more convenient and accessible primary care locations.  Only through an aggressive primary care program that is structured to include all qualified veterans will the VA be able to cultivate a climate of preventive, medicine and early detection for serious illnesses. 

The VA Medical Center will always be the bedrock of VA medical care to take care of the most serious medical problems of our veterans and the VISN/CBOC system is a proven winner, in our opinion.  But we still believe that contract primary care using existing private-sector facilities is going to be critical to the VA.  So we in South Boston, in Halifax County, are prepared to lead the way.

And that concludes my—do we get a chance later on to answer questions? 

Mr. MICHAUD.  Yes.

General THACKSTON.  Again, we thank you very much for the opportunity to be here today. 

[The prepared statement of General Thackston appears in the Appendix.]

Mr. MICHAUD.  Thank you very much, Major General, for your testimony.  And we're looking forward to working with you as we move forward in addressing the concerns that we have heard about veterans accessing to applicable health care services in rural areas.  Thank you very much for your service to this great Nation. 

Mr. Chapman?

STATEMENT OF HOWARD CHAPMAN

Mr. CHAPMAN.  I'm Howard Chapman.  I'm the Executive Director for the Southwest Virginia Community Health Systems.  We're Federally-funded health centers, community health centers (CHCs) that receive Federal support located across the Commonwealth of Virginia.  There are approximately 24 organizations with just over 110 sites. 

Southwest Virginia Community Health Systems offers primary care and preventive services, but in addition, we have provisions for an integrated model of mental health in a primary care setting, which works well with depression and even substance abuse.  It's a collaboration between the primary care doctor as well as the mental health provider. 

We provide some degree of medication assistance through the Federal Drug Pricing Program and 340B.  We also have a medication assistance program that uses the patient assistance programs through the different pharmaceutical companies.  We have worked to provide some limited transportation, and all this in regard to trying to deliver good primary care services in rural areas and knock down the barriers. 

One of the groups that do have a lot of barriers in their way are the veterans in our area.  So we very much try to take advantage of being able to provide them the same level of services that we do the rest of the community. 

We have been a CBOC operation, and our contract was terminated in May of 2009.  We had actually been working in that capacity since 2005 and had built—we had just over 800 patients enrolled within our CBOC operation.  We actually had been one of the first CBOCs in the Nation.  Back during President Reagan's Administration, in the early 1990s, Secretary Sullivan made the announcement on the Capitol steps.  And much along the line of, again, trying to develop and extend health care services to veterans, they actually tied the program to a program in Tuskegee, Alabama, that was looking to serve nonveterans in a VA hospital.  And various veterans organizations, they take back full Congress and asked to appeal before we ever saw the first patient.  But what we had done was been able to work with our local veterans that were anticipating having these services in their community and directly affecting their lives. 

We worked for probably another 10 years or so to actually get those services started back, and it was going very well.  We were very pleased with it.  We did have some issues with the Veterans Administration in how they actually had set up some of the process.  Rather than a direct link in using the VistA system that they have as their medical record, we were given sort of a dial-type virtual private network (VPN), which was extremely slow, really dragged out the length of the appointment for the veterans.  And, you know, even in assessing things like that, we needed to do the preventive measures that—that they had in their process, it's really cumbersome to work your way through this system.  It could have been made a whole lot easier through an integrated medical record that would have allowed us to use our existing electronic medical record (EMR) and dumped information into their system. 

All of the technology things that happen, you know, it seems the veterans administration are behind on doing a lot of that.  VistA is old technology, and I know they've talked about moving into a Web-based system, but, you know, it needs to be upgraded as we are moving toward this whole area of health information exchange and that type of thing. 

I just want to close by telling you that at the close of our—our CBOC contract, the Veterans Administration announced the meeting in February, and the morning that they had that meeting, the temperatures were down in the single digits.  They had done the melding on Wednesday.  Most of the veterans did not get their announcement until Friday or Saturday.  And they had asked us for space to accommodate 50 to 60 veterans.  They had more than 250 that showed up.  So again, the concern about veterans and the health care that they receive is really, you know, tremendous, a tremendous effort. 

We have maintained and kept a lot of those patients just because it's an hour and a half, eitherto the Salem VA or the Mountain Home VA in Johnson City, and again they have set up a couple of VA staff, CBOC in Bristol.  There's actually one in Atkins.  And all of this has a considerable amount of cost in regard that they don't own the building but lease the space.  And the renovations and things that they have had to do have been again money that's sort of lost in regard to VA paying for renovations and constructions that, you know, we can as Community Health Systems across the State of Virginia provide pretty much immediate access through a contracted arrangement to at least 110 sites across the State of Virginia.  Most of the centers are Joint Commission on Accreditation of Healthcare Organizations (JCAHO),  accredited.  They meet high quality standards, and we're very willing to work with the Veterans Administration to see that happen. 

One other thing I would note is that we do have a Statewide contract for TRICARE that allows service to military families.  And the other benefit behind using a community health center is not only for the veteran and the services through the VA, but we have a sliding fee scale for the families and children and spouses of these veterans, that we can offer the same level of service based on their ability to pay by total family income and total family size. 

So we think it's a great benefit for the veterans.  I think it opens up immediate access for the veterans and their families, and we would very much like to see the CBOC continue and be back in line to be able to serve the veterans in our community.

[The prepared statement of Mr. Chapman appears in the Appendix.]

Mr. MICHAUD.  Thank you very much, Mr. Chapman, for your testimony.  I look forward to asking the questions that we will have for you.

STATEMENT OF KEVIN TREXLER

Mr. TREXLER.  Mr. Chairman, distinguished Members of the Subcommittee, I'm grateful for the opportunity to provide testimony on behalf of DaVita.  I manage more than 80 clinics in Virginia, DC, and Maryland.  I am also a veteran.  I served as a naval officer 6 years on an attack submarine.  At this time, I will summarize my written statement and look forward to responding to any questions you may have. 

DaVita is a leading provider of dialysis services in the United States.  It provides treatment to more than 117,000 patients each week in more than 1,500 centers, and represents nearly one-third of all patients with end-stage renal disease or ESRD.  We are also a recognized leader in achieving excellent clinical outcomes, consistently demonstrating outcomes that are among the best when compared to national averages.  Our testimony today addresses the Subcommittee's interest in understanding the quality of and access to dialysis care provided to veterans in rural and underserved areas. 

DaVita is privileged to care for more than 2,000 of our Nation's veterans in our dialysis clinics across the country.  Our dialysis providers deliver dialysis treatment in veterans' communities when the VA cannot provide reasonable access or lacks in-house capability to provide this life-saving treatment. 

More than 20 percent of veterans with ESRD in rural Virginia have no treatment options within 20 miles of their home.  We consider ourselves a partner with the VA and are committed to providing excellent quality, exceptional clinical performance and outstanding customer service to all these veterans whom we serve. 

Veterans receiving dialysis treatment are frail patients often with multiple illnesses and cannot survive without dialysis or kidney transplant.  Thus patient access to care is critical.  Patients receive three treatments per week, every week of the year, often 4 hours at a time.  Both provision of the treatment and the financial aspects of the dialysis treatment are unique.  Dialysis and all it entails is expensive, but in fact it is only about a third of the total cost for unmanaged end-stage renal disease patients.  I will address both of these issues and suggest a way to improve the health status for these extremely sick veterans and the VA's desire to reduce total costs of purchased care.  DaVita recognizes and supports the VA's goal for standardizing reimbursement for the purchase of non-VA provided health care services and reduce costs in a way that—that will ensure that we can continue to provide care for all of our veterans in rural areas.  I'd like to share two ways that dialysis providers and the VA can have win-win approach to these issues. 

First, here in Virginia we provide care to veterans through VA established existing negotiated contracts.  These contracts, if continued, will continue to provide mutually agreed upon sustainable reimbursement. 

Second, we propose to the VA that they implement a patient-centered, integrative care management dialysis program for the ESRD veterans.  Results of this would be improved clinical care for the patients and lower total costs to this system.  In Medicare demonstration projects, we have been able to improve clinical outcomes and reduce hospitalizations.  Dialysis is only about a third of the cost for end-stage renal disease patients.  The majority of the costs come from emergency room visits and hospital stays. 

An integrated care program would focus on all the clinical needs of the veteran, and would provide lab, pharmacy, medication therapy management, vascular access care, vaccination, case management and access to diet and nutrition counselors and nephrologists.  The VA currently does not receive any clinical data about its dialysis patients.  In the integrated care model, we fix that in the system, but would provide an interface between our extensive databases and our integration systems. 

In response to the VA's request for dialysis care innovation, DaVita will also submit a proposal that reflects our expertise in providing and remotely monitoring dialysis care in the patient's home that would be of particular benefit to patients in rural areas. 

On behalf of DaVita, I'd like to thank you again for your interest in the care we provide to our veterans and commitment to ensuring that veterans in rural areas continue to receive the quality of and access to care that they have earned.  We're grateful to the Subcommittee for its leadership in seeking new ways to promote quality care for all veterans and especially the unique population of veterans with kidney disease whom we serve.  I'd be happy to answer any questions you may have.

[The prepared statement of Mr. Trexler appears in the Appendix.]

Mr. MICHAUD.  Thank you very much. 

Once again I want to thank the panel for testimony this morning and I look forward to working with you as we move forward.

Major General Thackston, I have a quick question.  As you heard, both Mr. Perriello and myself are very concerned about access to health care for veterans who live in rural America.  Rural health care issues are extremely important and over and over again we continue to get legislation that contracts out VA services. 

At the same time we have heard some concerns from the VSO community.  And as a Major General and a former Adjutant General of the Virginia National Guard, are you concerned that we might no longer need the VA medical facilities, or do you feel there always will be a need for the larger medical facilities? 

General THACKSTON.  Yes, sir, I certainly feel there will always be a need for that.  What we are concerned with—like yesterday I ran into a lady and I told her where I was going this morning.  She said, "Oh, thank goodness."  She lived down in Clarksville.  She said, "My father is a World War II veteran, and he has to have somebody drive him to the VA Medical Center in Richmond."  So there's literally hundreds of people like that in rural areas, as I'm sure you know. 

The other thing we're quite concerned with is the relaxation of the criteria that will qualify veterans for the PTSD as well as—Dr. Browne, if you take a minute, wants to explain a little something about how the criteria for heart disease has been expanded, which will cover a number of Vietnam veterans.  Have we got time for that? 

Mr. MICHAUD.  Yes, we will.  Before we turn over to Dr. Browne, when you look at, for instance, community health centers and other qualified health care clinics and hospitals in rural areas, and where they're currently located using Federal dollars, in a lot of cases, they’re in the same area as access points recommended in the Capital Asset Realignment for Enhanced Services  Process in 2004. 

Do you feel that veterans will be less likely to visit community health clinics versus a VA facility, or do you think they'll be more likely to use a community health clinic since it's in their community? 

General THACKSTON.  You mean community health clinics? 

Mr. MICHAUD.  Yes. 

General THACKSTON.  Yes, sir, I feel like they'll be more likely, because, for example, this new primary health care center we have in South Boston, we have had all kinds of people that are qualified to go there, but our veterans can't unless they pay, and they have to go to Richmond, Salem, or Durham.  So I feel like if we have this expanded network, they will certainly be used to a great extent.  And we have done a rather exhaustive study to talk about the costs and reimbursement for travel that VA pays for many of these veterans who go to McGuire and Durham.  And we have these clinics that will certainly save the VA money, and it will save our veterans time.  You know, a lot of them have to take a day off from work, and a lot of them have to get somebody to drive them. 

But to answer your question, for serious illnesses and all, they will still go to the major VA centers, but we'd like to think this community-based, the CBOCs as well as what we are trying to establish, will serve an important need. 

Mr. MICHAUD.  Dr. Browne? 

Dr. BROWNE.  Well, I agree.  I got started in this because I've practiced medicine down there for a long time.  I would like to point out to the Subcommittee that this is a moving target.  When I go to the barbershop, I wonder whose head they're cutting when I see all that silver stuff falling on the sheet.  I used to be young and strong.  Nobody knew when we were in Vietnam what was going to happen with this Agent Orange business, which is a massively expanded load.  Who knows about all these other issues. 

Plus, if a veteran becomes 30-percent disabled from a service-connected illness, then he becomes or she becomes enabled to go for any illness, and people age and they get problems.  So we think, like the rest of the country, as the veteran population ages, their demand for services will increase.  And that's been my experience.  In internal medicine, most of the patients are elderly, and many, many, many of them are veterans. 

So we see this as a way to integrate to—also to minimize the number of unnecessary visits to the mother center.  If people get chest pain, where do they go?  What is it?  Well, it could be nothing.  Somebody needs to sort of triage these people.  And we see this as a way to improve the quality of health care, to intervene with simple measures, to get one-on-one treatment, and to improve the quality of referrals to the VA center, to utilize those physicians better. 

As you know, there's going to be a shortage in this country, not only of primary care doctors, but there may be of other doctors and nurses.  There's going to be a competition between the VA systems and other health systems for qualified people.  This is a way for the VA to immediately expand its staff by incorporating CBOCs and—and willing other participants and treat, splint them where they lie, treat them forward. 

Mr. MICHAUD.  Thank you. 

Mr. Chapman, what have you found to be the biggest barrier to working collaboratively with the VA system in the Community Health Care Centers? 

Mr. CHAPMAN.  I think working in the VistA system with the restraints that we had by using the dial-up.  Had it been pretty much a live connection, where our providers could have done that real-time would have definitely speeded the process.  Again even further to have had the ability to use our own electronic health record and then download the information or send it to the VistA system—we're not taking anything out of their system.  We're actually adding information to their system—it would have greatly enhanced the ability for us to have been able to have done those services. 

You know, if I could follow up on maybe a couple of the questions in regard to rural America.  You know, again, in rural Virginia, by the 2000 census data, we have some communities in Southwest Virginia that 14 percent of the householders do not have vehicular transportation.  So that trip, an hour and a half to the nearest VA hospital is almost impossible for some of these veterans. 

You know, 12 percent of the households lack basic telephone service.  So while we all take for granted that we carry cell phones, a lot of people out there just don't have that, that ability.  And so, you know, we think there are a lot of barriers to serving the veterans and making these services accessible in the communities and the places that they live really is a great benefit for the veterans. 

The VA hospital uses the, I think, all open-access scheduling.  Everyone is given the 8:00 appointment.  And again, these veterans do go and they sit all day, primarily, before they're seen.  And that gets to be a real hindrance, to be able to ask a friend or a relative or a neighbor to take you to the VA hospital and, you know, and be there for a day. 

We've actually used the same scheduling with the veterans that we did for our regular patients.  They were given a 2:00 appointment, and they were seen on or around 2:00.  They may have been delayed somewhat, but again it did allow the veterans to be able to take advantage of sort of scheduling their time and knowing what they could do and not wasting a day for health conditions.

Mr. MICHAUD.  You mentioned, I think, in 2005 to 2009 that you took care of 800 VA patients? 

Mr. CHAPMAN.  We have never done any marketing.  We've sort of just let word spread about the program itself.  And again, we had some degree of existing capacity that we were able to enroll about those 800 veterans.  We were actually moving toward probably having two or three providers that would just have been able to serve the veterans themselves rather than just fall to spreading it across all of our medical providers, and we think that would have worked out a little better for the arrangement.  It would have given us access for, on heavy days, some of the other providers.  All of them would have been potential, but we would have had two or three primary providers that would have been just serving the veterans.  And we think that would have made a little better situation than what we had. 

Mr. MICHAUD.  Have you looked at the cost of providing health care services?  Since you no longer, I understand, have the 800 veterans, has the cost per patient gone up? 

The second question, relates to quality of care.  Is it fair to assume that some of those 800 veterans are no longer getting VA health care because of the travel distance? What were some of the comments from the veterans who might have stayed there or gone to VA and then ultimately quit? 

Mr. CHAPMAN.  We did actually maintain a lot of those veterans, primarily because again the CBOC—VA staff/CBOC in Bristol, which again, you know, it's 40 miles away.  And some of the comments we got from the veterans is, if I've got to drive 40 miles, I'll drive the other half-hour and go to the VA hospital anyway, because if I need other testing, things like that done. 

You know, probably in October or November of 2009, one of the veterans had commented that they were backlogged, and I think it was by about 1,200 patients or more, that they were having to schedule appointments, try to get enrolled in the VA system at the Bristol CBOC. 

You know, they've built three others from some of what they took away from the community health centers, and the VA staff models now, again with the extensive amount of money going into renovation and things, the facilities that the VA did not own, and the—and bring their own providers in.  The one in Marion or Atkins, Virginia, I think the last count I had, they were open maybe 2 days a week, and last count I had, they were about 6 months behind on—on a wait list of about 6 months to get a veteran enrolled in that program.  So there's still a lot of access issues from the standpoint of the VA. 

The VA hospital in Johnson City and in Salem are extremely busy.  They don't have the capacity to be able to take these.  When you see waiting lists of 6 months or more in getting a veteran enrolled, it really indicates that there is a need for more services out in some of these rural communities. 

Mr. MICHAUD.  Thank you. 

Mr. Trexler, in your testimony you talked about the capabilities of remotely monitoring the patient in their home.  Can you explain to the Subcommittee what type of technology veterans might need in their home to be able to be monitored properly? 

Mr. TREXLER.  It would be telephonic, just by phone or also video conferencing. 

And there's another part of this program I want to stress that particularly applies to rural locations.  We would provide predialysis education to all the patients, and our research shows that patients who are educated choose what's called a home modality, the ability to receive dialysis treatment in their home 30 percent of the time versus an uneducated patient will only choose it six percent of the time.  So this would be another component of the program that would help veterans have access.  They won't have to travel three times a week far away to receive this treatment.  They can do it in the comforts of their home. 

In addition to that, we also have a program to provide medications to be delivered directly from the center to the patient's home, once again reducing the number of times these veterans would have to go to the pharmacy, oftentimes have to go to multiple pharmacies to get all of their medications they require for dialysis, and also improve the adherence because we'll get a report that will alert us when the patient runs out of medication or when they should run out, so we can remind them to refill that and also check to see if they've used all of their medication. 

And a third major component of this is by providing better education, we reduce the number of crashes into our hospitals, so the patients have a gradual transition into dialysis as opposed to having an acute illness that causes them to go in the hospital, and the benefits of this are reduced total costs and improved outcomes and mortality in the first year of dialysis. 

Mr. MICHAUD.  And my last question is—and I know this is an important issue for Medicare/Medicaid patients, and an issue the Committee is somewhat familiar with—about dialysis reimbursement rates. VA is looking at adopting the Centers for Medicare and Medicaid Services reimbursement rates.  In  Maine, we have the oldest population per capita in the country.  We're number one for the loser on Medicare.  We're number two for the loser on Medicaid.  Sixteen percent of our population, near the top among States.  We're near the top.  We're a rural State.  For reimbursement rates, we're second from the bottom for Medicare.  And that's actually a concern, making sure that providers will be able to adequately take care of their patients.  And one of the reasons why we’re near the top for high insurance premiums is because there's a lot of cost shifting that's occurring because of low reimbursement rates. 

Do you have a brief comment on reimbursement rates for dialysis treatment and what might that do for some of the facilities that are in rural areas, which tend to have higher numbers of Medicare/Medicaid patients? 

Mr. TREXLER.  I want to focus my testimony on what would we would do to provide access for rural veterans and also to improve the quality.  We've submitted other testimony that provides more extensive comments about any proposed changes of reimbursement.  I'll just briefly summarize them by saying that any change could have unintended consequences, and it could be negatively affecting the access of care in the rural communities for all the reasons that you mentioned.  But I'd just urge the Committee to make sure you are researching that, because no one wants to see any reduction in the access to care for our veterans.  They've certainly earned it, and I thank the Committee for your support, asking the questions and doing the research. 

Mr. MICHAUD.  Mr. Perriello? 

Mr. PERRIELLO.  Thank you very much, Mr. Chairman. 

Thank you again to all the panelists.  A few questions to run through. 

First, just so I understand, for General Thackston and Dr. Browne, right now with the existing facilities, someone with private insurance, Medicare/Medicaid, could attend, but a veteran could not; is that correct? 

General THACKSTON.  Correct. 

Mr. PERRIELLO.  And to what extent have you and Mr. Chapman, to the extent you all are still serving some of those veterans, are you already seeing a change in or any trend lines in the amount of care or upticks that you're seeing, or is this something 5 years off or 10 years off in terms what you're expecting for some of the changes that you have predicted? 

General THACKSTON.  You want to answer that? 

Dr. BROWNE.  Well, I can't answer that question at this point.  We don't have the information.  As you know, we have researched everything pretty well, and I can't answer that, don't have enough data for that.  But I expect that if—if you read what's in the various literature, General Shinseki's decision to include certain new illnesses with Agent Orange, that alone is going to massively impact the Veterans Administration.  I don't see how they'll be able to cope with it, frankly.  But that alone will clog up the system beyond belief, in my opinion. 

Mr. PERRIELLO.  One of the concerns we've heard in the past is the issue or issues that arise when you handle both a veteran and a nonveteran population in the same physical area.  To what extent did you see that, Mr. Chapman, and to what extent has that been thought through or considered in the South Boston context? 

Mr. CHAPMAN.  Again, we basically were using the existing providers we had in working through the—pretty much the excessive stacking and had some degree or capacity to observe those.  We really think it would probably have been better to have had more or less a provider or two.  Now, I don't think there's a difference between, you know, a veteran and a nonveteran in the same facility.  I think, again, we would have been better off to have a couple providers that would have been just dedicated to serving the veterans, and then, you know, in high demand times we could have had the other providers serve as backup to those staff.  But we do extended hours, again real convenient for the veterans and that type thing, and we didn't see a problem with that. 

I think, again, you know, veterans were appreciative of the services.  Again, they were appreciative of being able to come in and appointed a time slot and really great patient satisfaction from the veterans in regard to services that they were receiving. 

Mr. PERRIELLO.  One of the things that I have been so excited about with the project you all have put together is not just the, you know, the level of detail and the community engagement with it, but it seems to me one of the reasons to support the pilot program is just to try different things.  What we know is we are going to see a different world than we saw 20 years ago in terms of the scale, in terms of the types of problems, the complexity, and so it seems like part of the goal of this Committee, both before I joined it and now, is to say we have to try some different things. 

So if you are saying to a group of people here's what we are going to test by the South Boston facility, by the primary care facility, and if it works, we will know X, if it doesn't work, we know Y, what do you say for us who has to look at this across the country that we could learn from what you all are putting forward? 

Dr. BROWNE.  Well, one of the things, if we get this far, if you grant us permission, is we intend to have a board, made up of consumers, veterans, who will meet quarterly and they will assess the performance of this.  And we would invite representatives from the VA to serve on that, and these veterans would make a decision about how this clinic is working and to meet their needs.  And if you met some of the people that we'll put on that, on that small group of five, seven people so it can function, and periodically review that and make a report to the VA or to you, whoever you wish, and then we'll assess how things go on as a pilot program. 

As far as the veterans are concerned, I took care of plenty of those.  They came in my office.  They didn't wear a veterans t-shirt.  They were amongst the people out there.  We treated them the same.  The only difference in my office was sometimes we had a huge difference in insurances.  It was a matter of processing the patient. 

In view of whether you put this clinic here, if you want a separate entranceway, we can accomplish that, or separate person to deal with that.  As you know, Mr. Loftis is interested in getting a couple of disabled veterans to work in this clinic and provide computer access and to process these veterans.  We even think that we should be able to enlist veterans at these local clinics.  A lot of them won't go to Richmond.  So who knows.  I think it's a moving target. 

Colonel DANIEL.  I'd like to add that, as the General pointed out in his presentation, we know we have some 1,100, 1,200 veterans that are currently enrolled.  We know we have close to 3,000.  And from the beginning we have said, why aren't all eligible veterans taken care of?  We have some younger veterans that are sitting back.  They're not getting the primary care.  They aren't getting educated.  That's going