The Subcommittee on Health will now come to order.  I would like to thank everyone for attending this hearing.  Today, we will examine whether Project HERO (Healthcare Effectiveness through Resource Optimization) is meeting the goals of delivering efficient, high quality contract care to our veterans. 

Each year, the VA spends more than $2 billion to purchase private, non-VA health care for eligible veterans.  The VA has the authority to do this when VA facilities are not able to provide the necessary health care or are geographically inaccessible to the veteran.  There is room for improvement in the way that the VA manages and coordinates contract care.  Specifically, there is no consistent process in place to ensure that care is delivered by fully licensed and credentialed non-VA providers, that continuity of care is monitored and is part of a seamless continuum of services, and that clinical information flows back to the VA. 

It is under these circumstances that the VA developed the Project HERO pilot program in response to the language in the Conference Report accompanying the VA’s 2006 Appropriations Act.  As the VA was in the initial stages of developing and implementing Project HERO, the Full Committee held a hearing on this issue in March, 2006.  At this Full Committee hearing, the VA testified that Project HERO aimed to provide quality cost-effective care, which is complementary to the larger VA health care system.  In this endeavor, the VA also testified that they would sustain on-going communication with the VSO community. 

We have since learned that the VA is implementing Project HERO in VISNs 8, 16, 20, and 23. On October 1, 2007, the VA awarded the Project HERO contract to Humana Veterans Healthcare Services and Delta Dental Federal Services.  We understand that the health care services became available through Humana on January 1, 2008 and that dental services became available through Delta Dental soon thereafter on January 14, 2008.

With nearly two years of rich program data, our hearing today will examine whether the VA has delivered on the promises of Project HERO.  For example, was Project HERO implemented properly to meet the pilot program’s objectives to provide improved access, quality, and cost-effective care?  Was there transparency in the implementation of this pilot program and was the VSO community informed and involved?  Finally, what has Project HERO achieved and what are the potential next steps moving forward?

To help us answer these questions, I look forward to hearing the testimonies of our witnesses.