May212013
Hearing Transcript on U.S. Department of Veterans Affairs Budget Request for FY 2011 and FY 2012.
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U.S. DEPARTMENT OF VETERANS AFFAIRS BUDGET REQUEST FOR FY 2011 AND FY 2012
HEARING BEFORE THE COMMITTEE ON VETERANS' AFFAIRS U.S. HOUSE OF REPRESENTATIVES ONE HUNDRED ELEVENTH CONGRESS SECOND SESSION FEBRUARY 4, 2010 SERIAL No. 111-59 Printed for the use of the Committee on Veterans' Affairs
U.S. GOVERNMENT PRINTING OFFICE For sale by the Superintendent of Documents, U.S. Government Printing Office
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CORRINE BROWN, Florida |
STEVE BUYER, Indiana, Ranking |
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Malcom A. Shorter, Staff Director Pursuant to clause 2(e)(4) of Rule XI of the Rules of the House, public hearing records of the Committee on Veterans' Affairs are also published in electronic form. The printed hearing record remains the official version. Because electronic submissions are used to prepare both printed and electronic versions of the hearing record, the process of converting between various electronic formats may introduce unintentional errors or omissions. Such occurrences are inherent in the current publication process and should diminish as the process is further refined. |
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C O N T E N T S
February 4, 2010
U.S. Department of Veterans Affairs Budget Request for FY 2011 and FY 2012
OPENING STATEMENTS
Chairman Bob Filner
Prepared statement of Chairman Filner
Hon. Steve Buyer, Ranking Republican Member
Hon. Corrine Brown, prepared statement of
Hon. Harry E. Mitchell, prepared statement of
Hon. John Boozman, prepared statement of
WITNESSES
U.S. Department of Veterans Affairs, Hon. Eric K. Shinseki, Secretary
Prepared statement of Secretary Shinseki
American Legion, Steve A. Robertson, Director, National Legislative Commission
Prepared statement of Mr. Robertson
American Veterans (AMVETS), Raymond C. Kelley, National Legislative Director
Prepared statement of Mr. Kelley
Disabled American Veterans, John L. Wilson, Assistant National Legislative Director
Prepared statement of Mr. Wilson
Iraq and Afghanistan Veterans of America, Paul Rieckhoff, Executive Director
Prepared statement of Mr. Rieckhoff
Paralyzed Veterans of America, Carl Blake, National Legislative Director
Prepared statement of Mr. Blake
Veterans for Common Sense, Paul Sullivan, Executive Director
Prepared statement of Mr. Sullivan
Veterans of Foreign Wars of the United States, Eric A. Hilleman, Director, National Legislative Service
Prepared statement of Mr. Hilleman
Vietnam Veterans of America, Richard F. Weidman, Executive Director for Policy and Government Affairs
Prepared statement of Mr. Weidman
MATERIAL SUBMITTED FOR THE RECORD
Post-Hearing Questions and Responses for the Record:
U.S. DEPARTMENT OF VETERANS AFFAIRS BUDGET REQUEST FOR FY 2011 AND FY 2012
Thursday, February 4, 2010
U. S. House of Representatives,
Committee on Veterans' Affairs,
Washington, DC.
The Committee met, pursuant to notice, at 10:00 a.m., in Room 334, Cannon House Office Building, Hon. Bob Filner [Chairman of the Committee] presiding.
Present: Representatives Filner, Brown of Florida, Snyder, Michaud, Mitchell, Hall, Halvorson, Perriello, Rodriguez, Donnelly, Space, Walz, Adler, Buyer, Stearns, Moran, Boozman, Bilbray, Bilirakis, and Roe.
OPENING STATEMENT OF CHAIRMAN FILNER
The CHAIRMAN. Good morning. Welcome to the hearing of the Committee on Veterans' Affairs of the House of Representatives on the U.S. Department of Veterans Affairs (VA) budget request for fiscal year 2011 and 2012.
I want to be able to move fairly quickly at the beginning and hear the testimony of the Secretary because we have a series of votes, unfortunately, somewhere between 10:15 and 10:30. We will be gone for 40 to 45 minutes, so I would like to get the Secretary's testimony in beforehand.
I ask unanimous consent that all Members may have 5 legislative days to revise and extend their remarks and that written statements be made part of the record. Hearing no objection, so ordered.
Mr. Secretary, you and the President have requested a VA budget of $125 billion, roughly, including a total discretionary request of over $60 billion. The VA medical care budget represents 86 percent of the total discretionary budget.
Also, for fiscal year 2011, the Administration is requesting over $51 billion in resources for VA medical care.
Appropriated resources for fiscal year 2011 have already been provided in last year's consolidated appropriations act and the funding level is an increase of $4.1 billion or 8.6 percent over 2010 levels.
Rest assured that this Committee will be working closely with our counterparts in the Administration and in the Senate to make sure the process moves forward to ensure veterans have the medical care resources they need when fiscal year 2012 begins.
The veterans' groups that co-author The Independent Budget, and who will be testifying today, have recommended a total resource level for VA medical care of $52 billion and an overall discretionary funding level of $61.5 billion, which is $1.2 billion above the Administration's request.
We are looking forward to their testimony and the testimony of the American Legion, the Vietnam Veterans of America, Iraqi and Afghanistan Veterans of America, and Veterans for Common Sense who will also testify today.
Mr. Secretary, I am impressed by your robust budget request and your emphasis on funding many of the priorities of this Committee, including addressing the plague of homelessness, rural health care access, access of women veterans, and the mental health care needs of our veterans.
The budget addresses problems faced by our newer veterans while not forgetting the sacrifices and service of veterans from previous conflicts.
We are looking forward to your testimony today.
Before I yield to our Ranking Member, I know I speak for our entire Committee, Mr. Buyer, that our thoughts and prayers are with your family, your wife, and yourself as you go through a very difficult time.
I yield to Mr. Buyer.
[The prepared statement of Chairman Filner appears in the Appendix.]
OPENING STATEMENT OF HON. STEVE BUYER
Mr. BUYER. Thank you very much, especially for your heart-felt comments.
Mr. Secretary, I apologize. I am going to make a quick opening statement. I had requested a hearing for a review of the Comcast/NBC merger. That hearing is now taking place this morning. They are doing opening statements. I plan to be here for your opening statement and then I need to go to that hearing.
So what I will do is I will make a few comments here and then I am going to incorporate two questions that I would ask for you to answer even though I will not be here.
With regard to your budget, I want to congratulate you on your agreed robust budget. There may be some differences we may have as we present the views and estimates to the Budget Committee with regard to where I would place some of those dollars.
The most significant problem, which you also recognize, is the disability claims backlog. The application of the 21st century technology solutions are extremely important.
I applaud you with the VA pilot programs reconfigured to modernize the claims process that are underway in Little Rock, Providence, Baltimore, and in Pittsburgh, and I look forward to their results.
And I also want to congratulate you. You faced the challenges head on with regard to the GI Bill. And much of those challenges, Congress dropped those challenges right in your lap. And there was some politics of the moment that did override the substance and the problem was presented to you. You did not complain. You met them head on and you met the challenge. In that process, some veterans were hurt, but that was no fault of yours. You took a very difficult situation and you did the best you could and I applaud you for that.
And for those veterans out there that did suffer and some of whom did not go back to school this fall because of their particular circumstance, my deepest apologies. But to those veterans out there across the country, please recognize that we have a VA Secretary that is off his heels, on his toes, and is leaning forward.
I also want to commend you for your Consolidated Patient Account Center (CPAC), the expeditious rollout for which you are doing. You and I had a good conversation. I was more than impressed on how you accelerated the timeline and your decision to go with a single contract rather than moving in installments in a timeline as presented to you by your own advisors, even in contracting.
And you have challenged them. You have challenged the system. But you recognize that as you challenge them, those are more VA dollars that will come into the system.
And so I have always felt that I was the one that was always challenging. You out-challenged me. And it is unfortunate that whatever occurred, dollars were not placed there, it is a hiccup in the process, we want to work with you.
If you could outline to the Committee kind of what has happened and what your way forward is on that and your over-the-horizon view for success for the CPAC rollout, I think, is extremely important. And I look forward to that, your response to that.
The other is with regard to the President proposing to use $30 billion in Troubled Asset Relief Program (TARP) funds to promote small business. I recognize that this will be a—it will be subject to political fodder here on Capitol Hill as to whether it is legitimate or whether that was an intent of Congress and we are in a political season.
My only challenge to you, Mr. Secretary, is to incorporate—please send a message to the President. If he is going to do this, incorporate veterans in the process. So for the last year, I have been asking for that billion dollars in loan guarantees for small businesses for veterans and we are being left out.
So if he is going to actually use those funds and find the legitimate or legal process in order to use those, I would ask you to ask of the President for veterans to be included in that $30 billion of the TARP funds for small business.
The other point I would like to make, and I do not know why this occurs, maybe this is part of the gamesmanship of over the years, but every time we do a budget, somebody likes to whack the Inspector General (IG). And we like the IG Office. We like the IG Office, I guess, as part of our oversight functions, especially Mr. Mitchell over here nodding his head.
It is a multiplier. I think you probably learned that also when you were over in the U.S. Department of Defense (DoD). When those ombudsmen or the IG Office put their eyes on things, yeah, you can upset people at times, but good things result from what they are attempting to do.
Also, when I talked about the added dollars for which you put in the budget, especially on the mandatory side, while I recognize that you have made some judgments with regard to the Agent Orange and for there to be presumptions, I want to make sure that we do not change the paradigm or the matrix with regard to outpacing science. We have always made science-based judgments with regard to causal connections and I want to make sure that we are not changing that paradigm.
And at the same time, you know, I look at that and say all of a sudden, we have found this money for mandatory funding while at the same time, part of our values, we sort of pride ourselves when we talk about taking care of the widow and the orphans. But in reality, we are not. And that is why I combined with the Sergeant Major Walz to address and increase Dependency and Indemnity Compensation (DIC) and eliminate the offset of the Survivor Benefit Plan (SBP).
So all of a sudden, we have found these funds, but we are still not taking care of the widows. And I just lay that out there as a challenge for all of us to come together somehow to take care of them.
And with that, I am going to yield back my time, and I respect your efforts.
The CHAIRMAN. Thank you, Mr. Buyer, and I agree with a lot of what you said. I hope the paragraphs on science-based decisions would be made to your caucus in regard to global warming. Okay?
Just a little dig. Do not worry, Mr. Secretary.
We welcome you, Mr. Secretary. You are accompanied by Dr. Gerald Cross, the Acting Under Secretary for Health; Mike Walcoff, the Acting Under Secretary for Benefits; Steve Muro, the Acting Under Secretary for Memorial Affairs; Todd Grams, the Acting Assistant Secretary for Management; and we have Roger Baker, the Assistant Secretary for Information and Technology.
By the way, you might let us know when all these acting positions are going to be dealt with.
You have the floor, Mr. Secretary, and we appreciate all your efforts on behalf of our veterans.
STATEMENT OF HON. ERIC K. SHINSEKI, SECRETARY, U.S. DEPARTMENT OF VETERANS AFFAIRS; ACCOMPANIED BY GERALD M. CROSS, M.D., FAAFP, ACTING UNDER SECRETARY FOR HEALTH, VETERANS HEALTH ADMINISTRATION, U.S. DEPARTMENT OF VETERANS AFFAIRS; MICHAEL WALCOFF, ACTING UNDER SECRETARY FOR BENEFITS, VETERANS BENEFITS ADMINISTRATION, U.S. DEPARTMENT OF VETERANS AFFAIRS; STEVE L. MURO, ACTING UNDER SECRETARY FOR MEMORIAL AFFAIRS, NATIONAL CEMETERY ADMINISTRATION, U.S. DEPARTMENT OF VETERANS AFFAIRS; W. TODD GRAMS, ACTING ASSISTANT SECRETARY FOR MANAGEMENT AND CHIEF FINANCIAL OFFICER, U.S. DEPARTMENT OF VETERANS AFFAIRS; AND HON. ROGER W. BAKER, ASSISTANT SECRETARY FOR INFORMATION AND TECHNOLOGY, OFFICE OF INFORMATION AND TECHNOLOGY, U.S. DEPARTMENT OF VETERANS AFFAIRS
Secretary SHINSEKI. Thank you, sir.
Chairman Filner, Ranking Member Buyer, distinguished Members of the Committee, thank you as always for this opportunity to present the President's 2011 budget and 2012 advanced appropriations requests for the Department of Veterans Affairs.
I also appreciate the generosity of your time in meeting with me prior to this hearing. Those are always invaluable opportunities for me to gain insights.
Let me also acknowledge the presence of representatives from our veterans service organizations (VSOs) in attendance today. Their insights have also been helpful to me personally and to the Department in helping meet our obligations to all of our veterans.
Thank you, Mr. Chairman, for introducing the members of the panel today. I would just point out that Mike Walcoff sits to my left. Todd Grams here is our new Principal Deputy and Acting Assistant Secretary for Management. Dr. Cross to my right. To his right, Steve Muro and then Roger Baker, our Chief Information Officer (CIO), on the end.
Mr. Chairman, I have a written statement, a longer written statement that I would ask be submitted for the record.
The CHAIRMAN. Yes. So ordered.
Secretary SHINSEKI. Okay. Thank you.
This Committee's long-standing commitment to our Nation's veterans has always been unequivocal and unwavering. That has been clear. And such commitment on your part and then the President's own steadfast support for our veterans resulted in a 2010 budget that was quite remarkable in providing the Department the resources to begin renewing itself in fundamental and comprehensive ways.
And that translates to the efforts, the transformation that we have been talking about. I report that we are well-launched on that effort and are determined to continue that transformation throughout this year, 2010, and carry over into 2011 and 2012.
We have crafted a new strategic framework around three governing principles that you have heard me espouse for the past year. It is about being people-centric. It is about being results-oriented. We want to measure what we say we are going to do and we want to be able to see what we got for the investment.
And then, finally, we want to be forward-looking. We think that there is much yet to be gained out of the potential of this Department.
This new strategic plan delivers on President Obama's vision for VA and is in the final stages of review. And we are prepared to share that plan with you once that review is done.
The strategic goals we have established will do several things. First, continue to raise the bar on quality and accessibility of VA health care and benefits while optimizing value.
The plan also improves our readiness to protect our people, both our clients as well as our workforce, and our assets day to day as well as in times of crisis.
The plan enhances even more veteran satisfaction with our health, education, training, counseling, financial, and burial benefits and services.
And, finally, the plan invests in our human capital, both in their well-being and then in their development as leaders.
In order to attain the kind of excellence in our management and IT systems, as well as our support services, which I consider vital if we are going to achieve the kind of mission performance I have described you should expect out of this Department, we intend to be the model of governance in about 4 years.
These goals got our people to focus on producing the outcomes veterans expect and have earned through their service to our country.
Now, to support VA's efforts, the President's budget provides $125 billion in 2011, as you have pointed out, Mr. Chairman, $125 billion, $60.3 billion in discretionary, $64.7 billion in mandatory funding.
Our discretionary budget request represents an increase of $4.2 billion and, as you have pointed out, it is 7.6 percent over the President's 2010 enacted budget.
VA's 2011 budget focuses on three critical concerns that are of primary importance as I pick these up in speaking with veterans.
First, better access to benefits and services.
Second, reducing the disability claims backlog and wait time for receipt of earned benefits.
And, third and finally, ending the downward spiral that often enough results in veteran homelessness, those three.
Access, this budget provides the resources required to enhance access to our health care system and our national cemeteries. We will expand access to health care through activations of new or improved facilities, providing health care eligibility for more, primarily through Priority Group 8 veterans, but others as well, and then making greater investments in telehealth, which I have described as sort of the next major step in delivery of health care. We will also increase access to our national cemeteries through the establishment of five new cemeteries.
The backlog, we are requesting an unprecedented increase for staffing in the Veterans Benefits Administration (VBA)to address the growing increase in disability claims receipts even as we continue to reengineer our processes, develop a paperless system integrated with the VLER, the Virtual Lifetime Electronic Record.
Ending homelessness, we are also requesting a substantial investment in our homelessness program as part of our plan to eliminate veterans' homelessness in 5 years through an aggressive approach that includes housing, education, jobs, and health care.
In this effort, we partner with the U.S. Departments of Housing and Urban Development, probably our closest collaborator, but also with Labor, Education, Health and Human Services (HHS), Small Business Administration, among others. Taken together, we intend to meet veterans' expectations in each of these three areas to be successful in our mission in access, working the backlog, and in ending homelessness.
We will achieve this by developing innovative business processes and delivery systems that not only better serve veterans' and families' needs for many years to come but will also dramatically improve the efficiency and cost control of our operations.
Our budget and advanced appropriations requests for 2011 and 2012 provide the resources necessary to continue our aggressive pursuit of the President's two overarching goals for the Department, to transform and to ensure client access to timely, high-quality care and benefits. We still have much work to accomplish—well-launched but still lots of room for work to be done.
So, again, Mr. Chairman and Members of the Committee, thanks for this opportunity to appear before you, and I look forward to your continued unwavering support and I look forward to your questions.
If I have time, I will address the question that was asked by Mr. Buyer. This budget allows VA to more than double the number of CPACs between 2010 and 2011, growing from three in 2010 to seven in 2011.
Moreover, this budget would allow VA to realize significant revenues from a 5-year deployment with a third-party collections increase of about $280 million through 2013 and about $1.6 billion increase to 2018.
There is an opportunity to go faster and I am looking for ways to accelerate if those opportunities present themselves.
Hopefully I have addressed the question, Mr. Buyer.
[The prepared statement of Secretary Shinseki appears in the Appendix.]
Mr. BUYER. Thank you.
The CHAIRMAN. Thank you. Thank you, Mr. Secretary.
Mr. Snyder, you are recognized for 5 minutes.
Mr. SNYDER. Thank you, Mr. Chairman.
Thank you all for your service, Mr. Secretary.
The issue of medical research is one that I generally ask about at the hearing. And I think the staff analysis is that your number on medical research does not keep pace with the medical research inflation rate which is higher. And the problem with that is research projects do best if researchers do not have to come and go and lay off staff.
And may I ask you, Mr. Secretary or Dr. Cross, do you agree with that analysis that your number does not keep pace with the medical research inflation rate?
Secretary SHINSEKI. Let me call on Dr. Cross, thank you for the question, to enter into the medical aspects of this and then I will pick up after him.
Dr. CROSS. Congressman, thank you for that question.
Mr. SNYDER. Is your microphone on, Dr. Cross?
Dr. CROSS. No.
Mr. SNYDER. Thank you.
Dr. CROSS. Thank you for that question, Congressman.
And for 2011, comparing it to 2009, it is a 16 percent increase. We do value the—
Mr. SNYDER. No, no. My question is, the analysis does not keep pace with the rate of inflation of medical research in real medical research dollars. I know what the lines are, but do you agree with that analysis, it does not keep pace with the rate of medical research inflation?
Dr. CROSS. I agree that we are moving forward with a research budget that meets the needs of our veterans. I am not sure what the exact percentage increase is in the research budget. But the percentage increase that we are looking at for inflation medically is around four percent, four and a half.
Mr. SNYDER. Well, let us do this as a question for the record then. I believe that your budget does not keep pace with the increasing costs that occur in medical research, whether it is within the VA or outside of the VA. If I am right, then it means that your researchers are going to have to lay off people or cut back on projects.
So why don't you get back to us on whether you think your budget number keeps pace with the actual real dollars in medical research. Can we do that that way?
Secretary SHINSEKI. I will be happy to provide that for the record.
[The VA provided the answer in Question #8 in the Post-Hearing Questions and Responses for the Record, which appear in the Appendix.]
Mr. SNYDER. Yeah. That would be great.
The CHAIRMAN. Mr. Snyder, we looked at that and we are going to—I think our Views and Estimates work to reflect an increase.
Mr. SNYDER. An increase, yeah.
The second thing, Mr. Secretary, in your—I do not remember if you mentioned it in your oral statement, but in your written statement, you referred to not just the number of claims but the complexity of claims.
In the time you have been on the job, why do you believe, what is your conclusion about why claims are more complex? Why are they increasing in complexity?
Secretary SHINSEKI. Let me call on Mike Walcoff.
Mr. SNYDER. Yes.
Secretary SHINSEKI. He has a little better working knowledge of the claims.
Mr. WALCOFF. Congressman, I think this is a continuation of a trend that we have seen over a number of years. The increase in complexity deals with, first of all, the number of issues that are being filed with each claim.
It used to be, 15 years ago or so, we would average between two and three issues per claim. Now that average on all of our claims is up over four, and the average on the claims that are coming out of our benefits delivery at discharge sites is over eleven.
So when you have that many issues coming in on a claim, it does make it a lot more complex.
Mr. SNYDER. Do we know why that is occurring? Are people being advised by attorneys or advised by the internet or advised by advisors? I mean, what—
Mr. WALCOFF. I think part of it is. I think veterans are becoming more aware of what they are potentially entitled to. I think our outreach is better. I think service organizations are doing a good job in working with them. I think that it is a combination of a lot of things, and I do not necessarily think that is a bad thing.
Mr. SNYDER. Right.
Mr. WALCOFF. I think it is a good thing, but it does add to the complexity of the work.
Mr. SNYDER. Right. And then Dr.—
Secretary SHINSEKI. I would add—
Mr. SNYDER. Yes.
Secretary SHINSEKI [continuing]. In addition to complexity, it is also the volume of claims that is also part of this equation. Last year, VBA processed 977,000 claims and received a million new claims on top of that. So complexity and volume are part of the equation here.
Mr. SNYDER. Well, I think I will yield back given that I have only got 20 seconds left.
Thank you, Mr. Chairman.
Thank you all.
The CHAIRMAN. Mr. Michaud, would you like to speak before we recess for our votes?
Mr. MICHAUD. Thank you, Mr. Chairman.
And thank you, Mr. Secretary, for coming here today and for bringing us this budget.
I appreciate your willingness and your concern about the issues you talked about today with homeless veterans, dealing with veterans in rural areas.
And I also appreciate the fact that the different Veterans Integrated Services Networks (VISNs) are having their Mini-Mac meetings back in their individual States, which is actually very helpful for the veterans service organizations and they are very informative.
That gets to my question as it relates to rural health. As you have heard, a lot of Members of this Committee on both sides of the aisle are very concerned about rural health issues, making sure that veterans have access to rural health.
I just attended actually a Mini-Mac meeting in Maine and some of the same concerns I have heard throughout the country. And we had a hearing not too long ago where actually we were talking about the distribution of funding the Veterans Equitable Resource Allocation (VERA) model.
Here is the concern, and it is not unique to Maine. The fact that rural veterans travel a lot of distance, we increased the mileage from 11 cents to 41 cents. What we are seeing in Maine, and I am sure other areas, is Maine funding was $1.5 million that they have given to our veterans in rural areas. It actually cost over $5 million. There is a shortage.
So what VA Togus is going to have to do, and I am sure it is the same in other areas because of the VERA model, is they are going to have to cut back on fee-for-service or not hire or lay off staff. They are getting penalized because they live in a rural area.
And it gets right back to the VERA model is have you done a comprehensive analysis of the VERA model and what are the driving forces of that model because if they have to cut back on fee-for-service or cut doctors in rural areas, it actually is counterproductive in what we are actually not—what we are talking about not doing.
The other issue is when you look at the Office of Rural Health, which has been great, they actually have funded good projects in different regions of the country relating to rural health, the problem being is these pilot projects that they are funding, once that money dries up, then that is put back on to the facilities which, here again, they will have to make those very tough choices.
What do you plan on doing for some of these pilot projects that are currently working in the Office of Rural Health, whether they will have continuing operational funding versus forcing a rural medical facility to actually make these tough choices? Are they going to cut doctors or are they going to cut back fee-for-service, which is counterproductive?
Secretary SHINSEKI. Mr. Michaud, I am going to call on Dr. Cross here in a minute, but let me just describe for you.
This is one of the challenges I have wrestled with for the past year and I do not know that it is the VERA model, but I do not know that is not either. And we are, as you have pointed out, we are looking at this very closely to try to understand the dynamics here.
When we talk about delivery of health care, as you know, we talk about everything from our medical centers to our community-based outpatient clinics (CBOCs) to our Vet Centers, fee service and contract and telemedicine. We spend a significant amount of money on fee basis.
Mr. Chairman, do we have time for me to finish or—
The CHAIRMAN. I think we should wait—
Secretary SHINSEKI. Okay.
The CHAIRMAN [continuing]. Because we have 5 minutes to vote. There are five or six votes. We will recess until 11:00 a.m.
Secretary SHINSEKI. Okay.
[Recess.]
The CHAIRMAN. I am sorry that the recess took so long. You never know with votes, and I apologize for holding everybody up. When we recessed, Mr. Michaud had asked a question and Mr. Shinseki was answering.
Do you want to briefly rephrase your question, Mr. Michaud?
Mr. MICHAUD. One of the driving forces as it relates to the VERA model getting funding back to rural, you know, medical facilities because some of the concerns I have heard not only in Maine but nationwide is the fact that you have got regional rural hospitals are actually going to have to cut back on fee services or eliminate positions in order to meet their balanced budget.
Secretary SHINSEKI. Let me just say that your concerns about the VERA model, I have similar questions I have asked. We are taking a look at it. And the rural aspects of this will be part of the review.
Let me ask Dr. Cross to address the specific issues you talk about there in Maine.
Dr. CROSS. Congressman, thank you for the question.
First of all, in regard to any specific concerns in regard to Maine, Togus in particular, I and my staff are ready to come over on very short notice and provide you any details that you require and go through that very thoroughly.
And the broad answer to your question, VERA has had nine external reviews thus far since it was created, by organizations like the U.S. Government Accountability Office (GAO). But VERA is also being supplemented because we recognize the needs in the rural community.
One of those supplements that we are working with, I think this Committee and you and others were very instrumental in passing it and making it possible, and that relates to Public Law 110-387, Section 403 in particular. That puts $100 million in 2011 for contractual and fee-basis care in rural communities. And I think that would help in Maine as well.
In addition, what we are doing with the rural health outreach is more CBOCs, more outreach clinics, more telemedicine. We anticipate that our telemedicine work in 2011 will reach 100,000 veterans in rural communities to make a difference in their lives for the better.
And I appreciate the work that the Committee has supported us with on this very important initiative because without your support, this would not have been possible.
Secretary SHINSEKI. Mr. Michaud, let me just say the issue of rural resourcing comes up frequently enough. We will respond to you and also provide back to the Committee a response to that question.
[The VA provided the answer in Question #7 in the Post-Hearing Questions and Responses for the Record, which appear in the Appendix.]
Mr. MICHAUD. Thank you very much.
My second question actually relates to State Veterans Nursing Home. As you know, we passed a law back in, I believe it was 2006, to deal with the per diems for State Veterans Nursing Homes. Ironically, since the VA has begun implementing the law, State Veterans Nursing Homes are being paid less, less than what they were being paid before.
And some of the concerns that I have heard from Veterans Nursing Homes nationwide is the fact that they might be going out of business since they are not going to be able to sustain that, the reduction in costs. And this here really hits hard those that are Medicare, Medicaid certified Veterans Homes.
We are having a hearing next week on H.R. 4241, which would allow for increased flexibility in payments to State Veterans Nursing Home.
I would like to know, have you heard anything about this or what are your comments as it relates to payments and State Veterans Nursing Homes?
Secretary SHINSEKI. Let me just say that we are working with the Department of Health and Human Services in looking at these rates. This goes beyond just VA. There is Medicare, Medicaid involvement here.
Let me ask Dr. Cross to address this in detail.
Dr. CROSS. Sir, you asked if we have heard anything about this, absolutely, and we share your concerns. It is my intention, and I understand the Secretary's intention, to move forward with a resolution as cooperatively as possible.
Let me say that we have 137 of these homes at the moment. They are very important to us and to our veterans. They do great work. They are run by the States and supported in part by the VA.
There was a Public Law passed, 109-461, several years ago, about 2006. We understand that there were some unanticipated, perhaps technical, issues that have arisen and become clearer since then.
We are going to have some upcoming hearings with you, and other sessions. We are going to bring forward our best experts to propose resolutions.
Mr. MICHAUD. Great. Thank you very much, Dr. Cross and Mr. Secretary. Look forward to working with you as we move forward in making sure our veterans get the best quality care that they can regardless of where they live. So I appreciate both of you. Thank you.
Secretary SHINSEKI. Thank you.
Mr. MICHAUD. Thank you, Mr. Chairman.
The CHAIRMAN. Thank you, Mr. Michaud.
I will ask the Secretary that when your team offers to give a specific briefing to someone who asks a question that usually reflects something we are all interested in. I would ask that any briefing materials that you give to one that you please share with the whole Committee.
If it was the other side, I would accuse them of a tactic of divide and conquer, but I would not accuse you of that.
Secretary SHINSEKI. Happy to do that.
The CHAIRMAN. Just make sure we all are briefed as well as the person who asked the question.
Secretary SHINSEKI. I will do that.
The CHAIRMAN. Thank you, sir.
Ms. Halvorson?
Mrs. HALVORSON. Thank you, Mr. Chairman.
And thank you, Mr. Secretary, for being here.
I, too, want to reiterate that if you are doing anything with regards to State Veteran Homes somewhere else, I would like to know about it. I have two of them, Manteno and La Salle, both in Illinois, in my district that I, too, want to make sure and keep up on and do something about.
I also want to thank you for working out a date with my staff and I know we continue to do that so that you can come to the district which you have agreed to do sometime in March so that you can see firsthand the issues of the veterans that are going on and the things.
And I would be remiss if I did not talk about Silver Cross Hospital in Joliet. And if I could get an update, I would love to hear from Dr. Cross or somebody with regards to what is going on with the medical facility in my district.
Secretary SHINSEKI. Dr. Cross.
Dr. CROSS. Congresswoman, thank you for your support and for working with us on this very important issue in Illinois.
We have a CBOC there and it is about 100 miles, as I understand, from Hines VA. That is quite a distance. And we think that that CBOC needs to be expanded.
We are very interested in the proposal that I think you have been very instrumental in, with regard to a possible option for Silver Cross Hospital or a portion of it.
And what we are doing is our engineers at Hines VA have already been out taking a look. The construction staff at the headquarters of VA here in Washington is getting ready to send, this month, a further assessment team out to look at it again.
But I wanted to assure you, Congresswoman, that we are interested. We think that this is a possible option for us. No final decision has been made yet, but we are moving forward.
Mrs. HALVORSON. Thank you.
The CHAIRMAN. Would the gentlelady yield?
Mrs. HALVORSON. Absolutely, Mr. Chairman.
The CHAIRMAN. I have been to that facility and other buildings around the country. This one is one and there happens to be one in San Diego. I am sure there are others that may have outlived their usefulness for a given purpose but can fit in very nicely with your announced and wonderful policy of zero homelessness in 5 years.
It seems to me that those buildings could be viewed as a shelter for those who are now homeless. Not only do the old hospital buildings have medical facilities, they have private room space for all kinds of other social service support programs, which would seem to be a very cost-effective way to serve our homeless population. They are generally in places that we do not have the NIMBY (not in my backyard) reaction to deal with.
I would see this not just as an isolated use of a surplus building, but as a method to really help solve the problem. Mr. Secretary, you know how tough it is to build a facility, even for 30 homeless veterans, and to get the local permits, the zoning, and all that stuff. It seems to me we have some perfect places that could really help with the plan you have announced.
I hope it would be seen in a very wide context and not just a surplus building, whether we need it or not. I thank Mrs. Halvorson for taking the leadership on that.
Mrs. HALVORSON. Thank you, Mr. Chairman.
The CHAIRMAN. I yield back.
Mrs. HALVORSON. Thank you.
And I do appreciate the time that you have taken and it is very, very important to our district because of the traffic and the amount of veterans that are in the area right there where that would serve. So, you know, I appreciate your diligence so that I do not have to keep making it, you know, a top priority for you also.
Secretary SHINSEKI. We are happy to follow up, Congresswoman.
And I would, in response to your comment and the Chairman's also, we are taking a strategic look at all of our facilities. We have 5,300 facilities in the system, and also looking at what is available to right size our footprint as we look 10 years in the future where we think veterans are going to be, long-term care, homelessness, how do we accommodate all of this.
So we are happy to—
Mrs. HALVORSON. Great.
Secretary SHINSEKI [continuing]. Take a look at a facility like that.
Mrs. HALVORSON. And the only other thing I would like to add on that is just to hope that you do not get bogged down in bureaucracy. You know, that is something that sometimes happens with these sort of things, that we just move quickly.
The only other thing that I would like to touch on is, you know, since 2007, the VA has increased its workforce by, I think, about 7,000 people in order to address our most favorite subject, the backlogs.
However, the backlogs have continued to grow. And I know that in this budget, you have asked for 4,000 more employees. What I heard yesterday is even though we are asking and we hire more employees, it takes 2 years to train them.
What is happening and what do we hope is going to come from continuing to hire more employees, taking time to train them? What is happening with regards to the backlog that does not seem to be getting under control?
This is the thing that people call my office for over and over again and it is very, very frustrating, I think for all of us.
Secretary SHINSEKI. Thank you.
The backlog is something, a year ago when I arrived, I said I am going to go after. We spent effort on it last year, but not as much as I would have liked. The GI Bill came along and we needed to get that put in place.
I would say we succeeded in the fall semester. We started with zero students in August, and we had 173,000 registered and being paid by December. So it was an effort that required that kind of attention.
In the meantime, the attention that I wanted to devote to the disability claims process was deferred. This year is my year to spend time getting inside of all of our processes. It is a convoluted and complex process.
What we have done with the claims process is pulled it apart and created four pilots. The pilots are running now, one in Pittsburgh, one in Little Rock, one in Providence, and one in Baltimore.
The whole purpose here is to take apart the pieces, let us see what we can do to refine them, and then put them back in a way that gets us momentum in claims handling.
Right now the inventory on claims is about 420,000. Of that, my guess day-to-day, is that we run about 150,000 to 170,000 claims in backlog, and that is any claim that is longer than 125 days.
The last several years we have taken the processing time on claims from about 190 days down to 180 and 178. Right now we are at 161 days moving towards 125 days. So there has been progress.
I reported earlier that last year we processed 974,000 claims, which is an eight or nine percent increase over our previous performance. At the same time, we got in a million new claims. So this is an area we are going to have to spend a good bit of effort on.
I compounded the problem when we make a decision on Agent Orange. It is the right decision. It was long overdue, needed to be done, but it adds to this challenge.
So as these four pilots are working to take the processing time of 161 days and moving it in the right direction, we have an Agent Orange decision here later this year that is going to come to play and it could increase processing time. It will certainly increase the inventory.
We are looking at ways to fast track the Agent Orange decisions so we do not compound the problem here. What we are looking for in the Agent Orange claims is proof of presence in Vietnam to meet the rules. It does not matter whether it was 1 day or 360 days. All we need to do is validate presence, validate the disease, which a competent medical authority does, and then adjudicate the extent to which the disease warrants a disability rating.
We think getting to that kind of focused decision making we can take these Agent Orange decisions and move them quickly, at the same time working on the normal disability claims process.
My estimate is over the next year to 2 years, the inventory will grow and processing time may get longer. It probably will get longer, but by 2013, we will be back to where we are today at about 161 days.
At that point, with the learning that comes out of the pilots already in the program and within a couple years, we expect to have eliminated the backlog. We are, although our incremental budgets talk about reducing, each year reducing the backlog, the plan is by 2015 for that backlog to be zero. That is what we are talking about.
Mrs. HALVORSON. Thank you. I yield back.
The CHAIRMAN. Thank you, Ms. Halvorson.
Mr. Rodriguez?
Mr. RODRIGUEZ. Thank you very much, Mr. Chairman.
Thank you very much, Mr. Secretary, also for coming by the district and reaching out throughout the country.
Your budget provides $468 million for minor construction projects, which is $235 million or 33 percent below the amount provided in 2010. And the budget also requests for $85 million for grants for construction of State extended care facilities which is $15 million or 15 percent below what was provided in 2010.
We had some dialogue about the fact that there might be about $9 billion out there in terms of construction needs and we know that of the 153 hospitals that are out there, most are 50 to 60 years old. We know we have some 70 or so clinics that are also in need of construction. And roughly, once again, I think that you had quoted in the past needing some $9 billion just to take care of some immediate needs.
With this kind of budget, how do we expect to look at this and be able to come up to par with the existing facilities that we have when we only asked for this low amount?
Secretary SHINSEKI. Congressman, let me just put into perspective the construction budget. And I may not have the details on the State construction that you describe. And if I do not, I will be happy to provide it for the record.
For major construction, we are requesting in 2011 nearly the same level at which we requested in 2010, which was fairly significant, $1.19 billion in 2010 for major construction and 2011 is 1.15 billion. And it will enable us to stay on track with constructing three medical facilities, design two new projects, and also expand cemeteries in three locations.
Minor construction appears to be the concern. But in 2011, we have $468 million going to minor construction. It is the second largest minor construction budget ever requested. And the reason it seems to be a drop-off is because the largest minor construction budget ever requested is in this year, 2010, when we increased it significantly to $600 million. In comparison, this minor construction budget for 2011 is a very strong investment.
On nonrecurring maintenance in 2011, our request is for $1.1 billion in nonrecurring maintenance. That is the largest nonrecurring maintenance request ever made by a President. Between 2000 and 2008, the average request for nonrecurring maintenance has been about $550 million. That has been the average across those 8 years.
And so we think this nonrecurring maintenance investment is—
Mr. RODRIGUEZ. Is it accurate to say that there is a need of over $9 billion right now that is required?
Secretary SHINSEKI. There is a backlog on maintenance that has accrued over many years. It is about $9 billion. You are correct. And so we are hopeful that if there is a job's bill that the VA will be seen as an appropriate—
Mr. RODRIGUEZ. And I would also support you in that. What better way to get Americans back to work than to look at redoing our hospitals and our clinics throughout the country for the veterans.
And I think the Committee would also be supportive if there is a job's bill out there to move in that direction and try to get some job creation, at the same time we build up our infrastructure for those veterans.
Secretary SHINSEKI. Thank you.
Mr. RODRIGUEZ. Thank you very much, sir.
The CHAIRMAN. I just want to note, Mr. Rodriguez, that in our Views and Estimates to the Budget Committee, we are going to recommend a plus-up in that account—
Mr. RODRIGUEZ. Thank you, sir.
The CHAIRMAN [continuing]. As one of the main items. Mr. Stearns?
Mr. STEARNS. Thank you, Mr. Chairman.
And I thank Mr. Boozman for the opportunity. I will have to leave here to go to another hearing.
Mr. Secretary, it is always a pleasure and an honor to have you to testify before us and thank you for what you do.
I think all of us will agree that this time, the Veterans Administration is experiencing an increase in the number of disabled veterans. I think that is a given. But it appears the decision to cut the Vocational Rehabilitation and Employment staff by nine while at the same time increasing the Compensation and Pension (C&P) staff by almost 4,000 seems to be puzzling to us.
The vocational rehabilitation employment counselors all have at least a Master's Degree. They are obviously highly qualified and capable of rendering services almost from day one.
On the other hand, the nearly 4,000 new C&P staff will require, and that is according to the VA, 2 to 3 years to become effective claims adjustors. Thus, the roughly 4,000 new C&P staff will have little or no impact on the claims backlog while the VA will lose 18,000 hours, in our estimate, of rehabilitation counseling.
So I guess the logic of this is somewhat puzzling to us and we would like your comment.
Secretary SHINSEKI. Thank you, Congressman.
Let me call on Mike Walcoff to sort of frame this issue and then I will add if anything is necessary.
Mr. STEARNS. Is the information we have correct?
Secretary SHINSEKI. In terms of the Voc Rehab—
Mr. STEARNS. Yes.
Secretary SHINSEKI [continuing]. Adjustment? I think that is correct.
Mr. STEARNS. Yes. Yes.
Secretary SHINSEKI. The specific numbers I will turn to Mike on, but there is an increase authorized in this budget of 4,000 to VBA. We have increased the resourcing of VBA by 27 percent in this budget to go after long-standing issues about the backlog and to address Agent Orange requirements that are coming on.
But the voc rehab question is an important one and let me ask Mike to address that.
Mr. WALCOFF. Certainly we recognize the importance of the Voc Rehab Program, but let me just explain a couple of things.
The decrease of 9 positions off of 1,155 is totally a result of the reallocation of management overhead. We use a formula to allocate that by business line. And the addition of such a large number of new employees just when we applied the formula resulted in a loss in that overhead category of nine for voc rehab. There will not be one person taken out of direct services to veterans in terms of voc rehab.
Number two, I want to point out that we have added $8.3 million to the contracting budget for voc rehab. That money gives us flexibility to either use this for contracting or to go ahead and turn it into a full-time equivalent (FTE). That money would buy 130 FTE if we decide to use it for that. So that is the second thing.
And the third thing is that, yes, right now we are talking about 4,000 additional claims examiners. In managing both programs as we evaluate the workload that is coming into Voc Rehab, we have the ability to move FTE from C&P to Voc Rehab. We will certainly do that if it appears that—
Mr. STEARNS. So money is fungible that you can take it from one—
Mr. WALCOFF. That money is, yes.
Mr. STEARNS. What is the average vocational rehabilitation employment caseload for 2011 compared to 2010?
Mr. WALCOFF. I do not have that.
Mr. STEARNS. Okay.
Mr. WALCOFF. I can get back to you on that.
[The VA subsequently provided the following information:]
VA anticipates a 10 percent increase in the 12-month average caseload for Vocational Rehabilitation and Employment services, with an increase from approximately 111,000 in FY 2010 to 122,100 in FY 2011.
Mr. STEARNS. The budget my staff tells me has indicated it is a ten percent increase in the budget in caseload.
Mr. WALCOFF. We are projecting a ten percent increase. But, frankly, that is something that at this point we are estimating because we are still trying to evaluate the impact that the Chapter 33, the new GI Bill, is having on the voc rehab program.
At one point, we anticipated that there would be possibly a decrease in participants because they would be going over to the GI Bill benefit which is financially a little bit greater. We do not see that at this point, but it is still early. We put a ten percent increase in there as an estimate, but we are going to be keeping an eye on it.
I think we have enough flexibility in this budget that we can address the additional work. If it winds up coming to Voc Rehab, we are in a position to be able to adjust to it.
Mr. STEARNS. So the basic thrust to my question is, and I think you agree then, that we really do not want to be cutting back the Vocational Rehabilitation and Employment staff considering the number of disabled veterans that are coming into there. And so that is, you know, what I think our main point is.
Mr. WALCOFF. Yes. I think we agree. We both recognize how important this program is and we are going to make sure that as we monitor the workload that, if necessary, we will move FTE into that program.
Mr. STEARNS. Okay.
Thank you, Mr. Chairman, for the courtesy.
The CHAIRMAN. Mr. Walz?
Mr. WALZ. Thank you, Mr. Chairman.
Mr. Secretary, thank you for being here as always and, of course, the work you do. And to each and every one of your staff, thank you for your continued service to our country.
And I would like to say how much I appreciate, Mr. Secretary, your thanking those VSOs, those folks that literally have your back right behind you right now. They are there every step of the way.
We have held some wonderful roundtables with the Chairman and the Ranking Member to get their priorities out and it is that collaboration through The Independent Budget, the things that are being brought to our attention by those on the front line of this, and I am appreciative. You have clearly understood that from your beginning of your tenure. So I appreciate that.
Just a quick followup. I think Mr. Stearns asked a very good question and it is one I am hearing quite a bit about. I absolutely understand your answer on this and understand that you are addressing it and agreeing with the living allowance and the new GI Bill, how that would affect.
I am hearing a lot, though, of the need to do something more with the voc rehab. So it is starting to percolate up. It is there. Mr. Stearns' question was well put and I am appreciative that you are on to that and looking at it from that regard.
So, Mr. Walcoff, I do not know if there is any response, but that is what I was going to ask.
Mr. WALCOFF. No. I appreciate what you are saying.
Mr. WALZ. Yeah. Well, thank you for addressing it and we will stay tightly on it.
Just two things. The Chairman started out talking about it. I am, too, a big fan of the IG. I am concerned. One of my biggest concerns as we increase budgets, if we do not increase that oversight and we know for many years as the IG budget was sinking, we did not have that there. The worst crime I think we can commit is, are how dollars allocated by the taxpayers meant for our veterans do not end up there.
And so I am really sensitive to that and I would like to, Mr. Secretary, just whatever we can do and know what your plan is on that.
Something that was brought up in our roundtable by the Vietnam Veterans of America (VVA), they, too, agree that the IG is wonderful on fraud and abuse. It is the waste part they are a little concerned with we may not catch.
And I think all of us together have to
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