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Witness Testimony of Mr. Carl Blake, Paralyzed Veterans of America, National Legislative Director

Chairman Filner, Ranking Member Buyer, and members of the Committee, on behalf of Paralyzed Veterans of America (PVA), I would like to thank you for the opportunity to testify today on the ongoing policy within the Department of Veterans Affairs (VA) to prohibit enrollment of Category 8 veterans into the health care system.  As our position is consistent with the policy recommendations of The Independent Budget, I will comment on this issue accordingly.

With the establishment of eligibility reform in 1996, the Secretary of Veterans Affairs was given the authority to manage the enrollment categories established by that law.  Subsequent to eligibility reform, the VA witnessed a dramatic increase in veterans enrolling in the VA health care system.  Unfortunately, the pace of appropriations did not keep pace with this rapidly growing demand on the system. 

Due to severely constrained budgets only a few years ago, former Secretary Anthony Principi made the administrative decision to place a prohibition on enrollment of new Category 8 veterans into the VA health care system beginning in January 2003.  PVA, along with the co-authors of The Independent Budget—AMVETS, Disabled American Veterans, and the Veterans of Foreign Wars—strongly opposed this decision at that time.  However, the VA assured us that the decision was strictly a one-year moratorium as the VA sought to improve health care services while dealing with chronic and severe under funding.

And yet, more than four years later, these veterans are still prohibited from enrolling in the VA health care system.  Despite repeated calls by Congress as well as all veterans service organizations for the VA to overturn this policy decision, the policy remains unchanged.  In accordance with the recommendations of The Independent Budget, we urge the VA to take the steps necessary to reopen the system to Category 8 veterans.   

As we testified back in February at the time of the release of the President’s Budget Request for FY 2008, the health care funding recommendations of The Independent Budget do no include additional money to provide for the health care needs of Category 8 veterans now being denied enrollment into the system.  We made the decision two years ago to include this as a separate line-item as it would have artificially inflated our overall health care recommendation, particularly since the VA did not seem to have any interest in reversing the policy.  We felt that it was not appropriate to build our health care budget recommendation on the desired change. 

However, we certainly believe that adequate resources should be provided to overturn this policy decision.  Due to ever-growing difficulty in seeking care in the broader health care market, more and more veterans have chosen to seek care from the VA.  They have also chosen to seek care from the VA because they, as we all do, recognize that VA health care is the best option in this country.  With this in mind, it makes no sense on a larger scale to turn these veterans away from the most cost-effective and cost-efficient health care system in America.  Ultimately, the cost of their care in the private sector will be even greater. 

Current VA estimates suggest that as many as 1.5 million Category 8 veterans will be denied enrollment in the health care system by FY 2008.  When budget estimates are developed for the cost of providing care to Category 8 veterans, often a worst-case scenario whereby all 1.5 million of these veterans would seek care in the VA health care system is considered.  However, this is simply unrealistic.  In a report entitled “The Potential Cost of Meeting Demand for Veterans’ Health Care,” published by the Congressional Budget Office (CBO) in March 2005, the CBO explained that the actual utilization rate of Category 8 veterans, prior to the enrollment prohibition being put in place, was only about 20 percent.  Based on this information, The Independent Budget estimated that only about 314,000 Category 8 veterans would have actually used the system, meaning that the VA would only be responsible for the cost for that number of veterans. 

For FY 2008, The Independent Budget estimates that the VA will require approximately $366 million in real appropriated dollars to reopen the health care system to Category 8 veterans.  Initially, we determined that the overall cost to allow 314,000 Category 8 veterans back into the system would be approximately $1.1 billion.  This was based on an estimated average cost-per-user of approximately $3500.  However, the simple fact is that if Congress makes the decision to allow these men and women to enroll, these veterans will be paying co-payments and any other required fees.  As a result, the real dollars cost-per-user drops significantly to approximately $1165.  As a result, the actual money that Congress would be responsible for providing to allow the estimated number of new Category 8 users into the system is $366 million. 

We would also like to draw to your attention to a particular concern that we have regarding a seemingly inequitable application of the enrollment policy.  As you all know, current law allows for a veteran of Operation Enduring Freedom (OEF) or Operation Iraqi Freedom (OIF) to receive two years of health care from the VA immediately following his or her release from active duty.  Once that two year period expires, any OEF/OIF veteran who sought care from the VA is permanently enrolled in the VA health care system in the enrollment category that they would normally be assigned.  This means that any OEF/OIF veterans who are Category 8 veterans are allowed to permanently enroll in the VA health care system, despite the current prohibition on similar enrollments.  PVA certainly has no objection to these men and women receiving the care that they have earned and deserve.

However, this is wholly unfair to any other veteran who would qualify for enrollment in Category 8, and whose service was no less important.  The example has been used many times, but it certainly is worth repeating about the World War II veteran who stormed the beaches at Normandy and spent nearly a year of continuous service in combat and subsequently returned home without injury or illness.  Following the War, that veteran took advantage of the GI Bill to get an education, and eventually lead a successful life.  However, because he now has a yearly income above the maximum allowed by VA for Category 8 veterans, he is prohibited from enrolling in the VA health care system. 

We do not see how this veteran’s service is any less honorable or important than the young man or woman currently serving in the Global War on Terror.  There is simply no reason for that veteran to be turned away from the system.  Just as we fully support the enrollment of the OEF/OIF veterans into the VA health care system, so to should any previous veteran who would otherwise be a Category 8 veteran be allowed into the system.  

Finally, I would like to emphasize that PVA believes that we would not be having any of this discussion about who can get into VA and who cannot if the Veterans Health Administration was funded through assured (or mandatory) funding.  The simple fact is that despite positive steps in the appropriations process and a positive outlook for FY 2008, nothing will prevent the VA from facing this same uncertainty in coming years.   The budget and appropriations process over the last number of years demonstrates conclusively how the VA labors under the uncertainty of not only how much money it is going to get, but, equally important, when it is going to get it.  Recall that even though the VA received a very good appropriation for FY 2007, it was still provided nearly five months into the fiscal year.  This is no way for the VA to be forced to manage its health care system.  It is not surprising that the VA took such a drastic step in 2003 given the budget climate at that time. 

In the end, none of these veterans should be denied enrollment into the VA health care system.  No veteran’s service is any more or less honorable than another, and it should not be treated as such.  We hope that the VA will choose to overturn this policy without being forced by Congress to do so.  It is the right thing to do. 

Mr. Chairman and members of the Committee, once again I would like to thank you for the opportunity to testify.  I would be happy to answer any questions that you might have.