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Priority 8 Veterans.

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JUNE 20, 2007

SERIAL No. 110-29

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BOB FILNER, California, Chairman


VIC SNYDER, Arkansas
JOHN J. HALL, New York
PHIL HARE, Illinois
MICHAEL F. DOYLE, Pennsylvania
TIMOTHY J. WALZ, Minnesota

STEVE BUYER,  Indiana, Ranking
HENRY E. BROWN, JR., South Carolina
BRIAN P. BILBRAY, California





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.



June 20, 2007

Priority Group 8 Veterans


Chairman Bob Filner
    Prepared statement of Chairman Filner
Hon. Steve Buyer
Hon. Corrine Brown
Hon. Cliff Stearns
    Prepared statement of Congressman Stearns
Hon. John J. Hall
Hon. Phil Hare
Hon. John Boozman
Hon. Timothy J. Walz
Hon. Ginny Brown-Waite, prepared statement of
Hon. Jeff Miller, prepared statement of
Hon. Harry E. Mitchell, prepared statement of


U.S. Department of Veterans Affairs, Hon.  Michael J. Kussman, M.D., M.S., MACP, Under Secretary for Health, Veterans Health Administration
        Prepared statement of Dr. Kussman

American Legion, Peter S. Gaytan, Director, Veterans Affairs and Rehabilitation Commission
        Prepared statement of Mr. Gaytan
Disabled American Veterans, Adrian Atizado, Assistant National Legislative Director
        Prepared statement of Mr. Atizado
Paralyzed Veterans of America, Carl Blake, National Legislative Director
        Prepared statement of Mr. Blake
Vietnam Veterans of America, John Rowan, National President
        Prepared statement of Mr. Rowan
Woolhandler, Stephanie J., M.D., M.P.H., Associate Professor of Medicine, Harvard Medical School, and Co-Founder, Physicians for a National Health Program
        Prepared statement of Dr. Woolhandler


Post-Hearing Questions and Responses for the Record:

Hon. Bob Filner, Chairman, Committee on Veterans Affairs, to Stephanie Woolhandler, M.D., Associate Professor of Medicine, Harvard Medical School, letter dated July 19, 2007

Hon. Bob Filner, Chairman, Committee on Veterans Affairs, to Carl Blake, National Legislative Director, Paralyzed Veterans of America, letter dated July 19, 2007

Hon. Bob Filner, Chairman, Committee on Veterans Affairs, to Adrian M. Atizado, Assistant National Legislative Director, Disabled American Veterans, letter dated July 19, 2007

Hon. Bob Filner, Chairman, Committee on Veterans Affairs, to Peter Gaytan, National Veterans' Affairs and Rehabilitation Commission, American Legion, letter dated July 19, 2007

Hon. Bob Filner, Chairman, Committee on Veterans Affairs, to John Rowan, National President, Vietnam Veterans of America, letter dated July 19, 2007

Hon. Bob Filner, Chairman, Committee on Veterans' Affairs, to Secretary R. James Nicholson, U.S. Department of Veterans Affairs, letter dated July 19, 2007


Wednesday, June 20, 2007
U. S. House of Representatives,
Committee on Veterans' Affairs,
Washington, DC.

The Committee met, pursuant to notice, at 10:07 a.m., in Room 334, Cannon House Office Building, Hon. Bob Filner [Chairman of the Committee] presiding.

Present:  Representatives Filner, Brown, Michaud, Herseth Sandlin, Mitchell, Hall,  Hare, Rodriguez, Space,Walz, Buyer, Stearns, Miller, Boozman, Brown-Waite, Turner, Lamborn, Bilirakis, Buchanan.


The CHAIRMAN.  The Committee on Veterans' Affairs will come to order.  I thank all the Members of the Committee and members of the audience and panelists who will be here to discuss this very important issue. 

The issue of the Administration’s continued ban on enrollment of Priority 8 veterans is an important one and I hope that we will leave here today with a sense as to the cost, and the effects of rescinding the ban, as well as the costs measured in the effect of denied access to healthcare of continuing the Administration’s policy of shutting the doors to an entire class of veterans.

We are the richest Nation in the history of the world at a time when we are spending a billion dollars every two and a half days on a war, and yet we are rationing care to our Nation’s veterans.  I think that is unacceptable. 

We started this era in 1996, Public Law 104-262, the Veterans Health Care Eligibility Reform Act, and the U.S. Department of Veterans Affairs (VA) has remade itself into a healthcare system that is really a model.  But in January 2003, then-Secretary Principi made the decision to bar enrollment of new Priority 8 veterans.  These veterans are non-service-connected and are called "high income" because they make $27,790 or more.  There is also geographic income thresholds.

Although comparably better off than veterans in lower priority groups, they are by no means all rich, as some would have you believe.  And yet, for four-and-a-half years, the doors to VA healthcare have been closed to them.

When we submitted the majority views and estimates for the budget for fiscal year (FY) 2008, we noted that the authority of the Administration to deny enrollment to an entire class of veterans was never meant to be an infinite grant of authority.  It was provided to the VA as a management tool at the time in order for it to address unexpected shortfalls that arose.  Unfortunately, the situation we face today is that this continues as a permanent policy and the Administration fails year-after-year to request specific funding for enrolling Priority 8 veterans and treats the January 2003 decision as permanent.

The VA has estimated that reopening enrollment will bring in an additional 1.6 million veterans and cost an additional $1.7 billion.  The Independent Budget (IB) prepared by our veterans service organizations (VSO's), has estimated that reopening enrollment would cost $366 million.  So I hope that we look at the differences among cost estimates and what it means if we continue the ban. 

Taking care of veterans is a continuing cost of war.  All veterans should have access to their healthcare system.  I hope the views of our witnesses will help us have a better understanding of this issue.  As I look at the history again, this is rationing of healthcare to veterans, those who have served our Nation.  And I think it is unacceptable in a Nation of our wealth and our ability to provide for these veterans. 

[The statement of  Chairman Filner appears in the Appendix.]

The CHAIRMAN.  For seconding my views on this issue, I call on the Ranking Member, Mr. Buyer.


Mr. BUYER.  Thank you, Mr. Chairman.  Mr. Chairman, I have a markup today in the Energy Subcommittee, so I probably won’t be able to stay for your entire hearing and Mr. Stearns will take over.  Knowing that, I have a little longer statement to enlighten you further on my views, Mr. Chairman.

When I spoke on the floor last week during consideration of the VA Appropriations bill, I commended the majority for your strong veterans funding.  You have broken ranks with your predecessors, i.e., the previous Democrat majority of the 1970’s and 1980’s that gave us a VA system that was depicted in the movie, "Born on the Fourth of July," which is not a pleasant picture.

You also have broken ranks with the Clinton Administration whereby they flatlined budgets to this Committee.  So Republicans, we are not strangers to budget increases.  The VA funding doubled during our majority after decades of these low budgets.  So I congratulate you on your veterans funding.

Our experience teaches us, though, that these increases cannot be a substitute for good management.  A challenge before this Committee will be to ensure that the VA manages its resources to produce the best possible outcomes for eligible veterans.  The values that I have learned in the military, have taught me that we care first for our wounded and only then do we consider ourselves.  To do otherwise is shameful conduct and contradictory to those values.

During the two years that I chaired this Committee, the budgets reflected those values which shape these priorities that we must care for veterans who have service-connected disabilities, those with special needs, the indigent, veterans returning from war, ensure a seamless transition for military service to the VA and provide veterans every opportunity to live full and healthy lives.

Veterans with service-connected disabilities, those with catastrophic disabilities and the indigent are the core constituency, our highest priority, individuals entitled to the highest priority of quality care. 

Now, I know, Mr. Chairman, you don’t care for the term "core constituency" and we have had this debate over the years, but it is not new.  VSO’s considering eligibility reform in 1995 used the term "core group." The Veterans of Foreign War has recently also used the term "core constituency" to identify these particular veterans. 

Providing core constituency veterans with quality care has been a traditional mission of the VA.  Veterans Health Care Eligibility Reform, Mr. Chairman, that you referred to, in 1996 established a system of patient enrollments based on priorities in which core veterans were assigned the highest priority.

So when you use the term "rationing," it was almost meant to be a negative term, but when we establish the priority of care, it was set up in a system by priorities to make sure that we care for individuals according to our military values.  Care for the non-service-connected veterans and those with higher incomes was authorized only when resources were available, meaning lower priority veterans.  After care was opened to Category 7 and later Category 8 veterans, the number of VA patients increased from just under 3 million to over 5 million.  VA has not been able to keep up, even with the near doubling of the healthcare budget. 

We are now learning that waiting times for appointments are longer than the VA had reported.  Core constituency veterans wait longer because of the millions of low priority veterans are competing against them for healthcare.  This was not the intent of Congress when in House Report 104-190 stated, "In designing the enrollment system and providing care, the VA may not enroll or otherwise attempt to treat so many patients as to result in either diminishing the quality of care to an unacceptable level or unreasonably delaying the timeliness of VA care delivery." 

VSO’s didn’t intend this outcome either.  Statements by major VSO’s at the time of eligibility reform showed widespread support for giving top priority to veterans with service-connected conditions.  David Gorman, then the Deputy National Legislative Director for the Disabled American Veterans, referred to "the priority that must be afforded to service-connected veterans before you can go ahead and start taking care of non-service-connected veterans." 

The VFW’s National Legislative Service Director, James McGill, warned against the VA being "relieved of its primary mission of caring for those who have sustained injuries while in the service to the Nation."  Passage of reform was partly based on VA studies indicating that with third-party collections, that it would be budget neutral and, in fact, that it would be revenue enhancing.  Reform would encourage veterans to seek preventive care in new VA outpatient clinics, reducing the need for expensive in-patient treatment.  And you and I have had this conversation, Mr. Chairman, over the years.

The Congressional Budget Office (CBO), however, believed reform would attract so many enrollees that it would dramatically drive up costs.  As it turned out, CBO’s predictions have been the most accurate.  My regret at this time is that I did not insist on the requirement to use accepted healthcare management tools such as the enrollment fees and co-pays and giving the discretion to the Administrations that reflected the true value of the costs of healthcare and giving them the ability to manage the health system.

I did that when I created the TRICARE for Life and I regret that I created a system for military retirees now that is different from that of someone who is a veteran with only two years of service, and they don’t have the same enrollment fees and co-pays and deductibles and things like that.  So we have a very strange system and we did the job half right.

Congress also gave the Secretary of Veterans Affairs the authority to limit enrollment based on funding.  The law required the Secretary to ensure that high priority veterans get the care they need and deserve.  In 2003, Secretary Principi, as you said, Mr. Chairman, suspended new enrollments for Priority Group 8 so that VA could fulfill its obligation to core constituency veterans as agreed to by the VSO’s in 1996.

Some say the government is obliged to provide essentially free healthcare for life to anyone who served more than one or two years in the military, so long as they have an honorable discharge.  I have concerns about that predicate.  The government has long agreed to provide healthcare based on the systems of priority and I endorse protecting the core constituency first.

And earlier when I brought up the issue, Mr. Chairman, with regard to our retirees, the military healthcare for retirees is not free.  They must pay the enrollment fees.  They make their co-pays according to their TRICARE plans, and I was really amazed to hear someone I have known for a lot of years, Steve Robertson, with the American Legion, argue against such comparisons between TRICARE and the enrollments, whether there should be enrollment fees and how we compare Category 7’s and 8’s. 

It has been bothersome to me for a long time, because we have this military retiree sitting in a waiting room that has to pay these fees, Sergeant Major, that is different from someone who may have only served one term and they get a better deal.  So we have got some challenges ahead of us.

The latest Independent Budget cites VA data that indicates, and this number, Mr. Chairman, I think is sort of all over the place, how many Priority Group 8 veterans are awaiting admission, pick a number, it seems.  I think once enrollment is offered, we have an example, it will open the gates and the surge will come in.  Those who think that mandatory funding will increase access and maintain quality, I think ignore the challenges entailed in expanding this system. 

Does VA have the capacity to accept millions of new non-service-connected veterans?  Even with this year’s funding increase, can VA absorb these new patients?  How fast can we build new clinics?  Can VA hire the doctors, the nurses and other caregivers when the Nation has experienced a shortage in clinicians?  How will communities cope with the siphoning of scarce clinicians with the opening of these clinics?

If we cannot satisfactorily answer these questions, then we have merely raised expectations and I think that is wrong.  The VSO’s advocate opening the doors to Priority 8 veterans and simultaneously complain about the waiting times for appointments.  But more money isn’t the solution.  As we have learned, the VA carries over hundreds of millions in healthcare dollars.  And for example, in 2005-2006 alone, take the money that we put in on a bipartisan basis for mental health, they couldn’t even spend all the money we gave them.

This is not to say that the VA hasn’t tried.  Over the past several years, the Department has worked hard to manage not only the waiting times, they have opened 800 outpatient clinics and improved collections, but there is still much work yet to be done.  We are working to improve the centralization of the IT system.  Mr. Chairman, you and I worked jointly together on this, along with other members of this Committee.  We implemented an advanced clinic access program.  The VA has provided the priority care to the veterans returning from Global War on Terror.  The Department’s developed a system of bar coding to reduce medical efforts, but there is still a lot of coding and in-coding challenges.

VA instituted a patient safety program, but a system of electronic health records still has a way to go.  And on top of this, the VA’s Secretary has told us regarding the medical center directors, he has ordered them to stay open longer to ensure their facilities "are available when veterans need them."  Despite these improvements, core constituency veterans are waiting too long, meaning they are being crowded out by the lower priority veterans.

So I am cringing at the moment.  I am glad you are having the hearing.  We can talk about it.  But we better move carefully. 

And Mr. Michaud, there is great pressure upon you.  You are going to be like the auto mechanic, to make sure that the systems are there and it works and it is prepared to receive, because I know you don’t want to recreate the problems that were created when we had the majority, when we opened the doors and didn’t prepare a system to receive.

And so I look forward to working with you, but we need to be mindful of the challenge ahead of us.  Just don’t throw the money and say well, we are going to open it up if we have not prepared the system.  And I thank you for your indulgence.

The CHAIRMAN.  I thank the Ranking Member for being so clear as to the differences on this panel and for making clear why your side may support a surge when it comes to military action, but we cannot have a surge, in your words, when it comes to treating our veterans.

Is there anybody that wants to make an opening statement on this side?  Ms. Brown?


Ms. BROWN OF FLORIDA.  Thank you, Mr. Chairman, and I have to leave also because we have a Transportation  and Infrastructure (T&I) markup.  I want to thank the Chairman for holding this hearing, long overdue, on the reasons for excluding 1.7 million veterans from the VA system and the promises made when they put their life on the line to defend this Nation.

I am reminded of the words of the first President of the United States, George Washington, whose words are worth repeating at this time.  "The willingness with which our young people are likely to serve in any war, no matter how justified, shall be directly proportional as to how they perceive the veterans of earlier wars were treated and appreciated by their country." 

President Bush failed to maintain veterans medical care funding over time.  The Bush budget asked veterans to pay new and increased healthcare fees and after 2008 cut veterans funding.  Over five years, those cuts total $3.4 billion below the level needed to maintain the 2007 level.  President Bush's priorities included imposing enrollment fees and increasing co-payments for veterans—the budget raises fees on veterans for their healthcare by $355 million in 2008, $2.3 billion over five years and $4.9 billion over ten years.

We, in the Congress, on a bipartisan basis, have rejected it in each of the last four years and we will continue to reject these schemes.  President Bush can send 484 tons of money, now, that is $12 billion to Iraq and this $12 billion cannot be accounted for.  Now, $12 billion is a cruise ship full of a hundred dollar bills.  We can’t tell you what happened to $12 billion.  One billion dollars would serve these 1.7 million veterans.

So we need to close up the waste, fraud and abuse that has existed in sending money over to Iraq.  This House just passed the largest increase in veterans healthcare in the history of VA and what does that President do?  He threatens to veto it.  I don’t believe it.  We are going to put it on his desk.  What is the priority of President Bush.  He threatens to deny coverage to veterans who serve this country, those Priority 7 and 8 veterans who do not have service-connected disabilities rated above zero percent, have an income above $27,790.

You know, we all, everybody up here, we talk the talk.  It is time that we walk the walk.  And I yield back the balance of my time.

The CHAIRMAN.  Thank you, Ms. Brown.

Mr. Stearns?


Mr. STEARNS.  Mr. Chairman, thank you very much.  I might just correct a couple items here.  You had mentioned the surge and likened it to this Priority 8 and I am not sure a lot of the Members realize that the Priority 8 was established when Republicans were in the majority.  In 1996, the Veterans Health Care Eligibility Reform Act was passed and then in 2001 the new Category Priority 8 for veterans was created for those who had served, but who had income or net worth above the VA income threshold.

So Mr. Chairman, it was under Republican watch.  I think it was Chairman Stump who got the legislation passed and the President signed, so it really is a Republican accomplishment in that respect.

I would say to my distinguished colleague—

The CHAIRMAN.  Thank you for taking the credit.

Mr. STEARNS.  —colleague Ms. Brown, that the Milcon-VA Appropriations Bill I think the President is going to sign and I, like many of the Members, support increased funding for veterans and we applaud the amount of the increase. 

But again, Mr. Chairman, I would like to point out something that all of us, even though we have been veterans or not veterans, we serve on this Committee.  We expect to be accountable and to understand that the dollars that are being spent are spent wisely.  Now, you mentioned, Mr. Chairman, that the salary of a veteran is $27,000, I think you said.  But I think the Members should realize that a Priority 8 veteran is a non-service-connected, his income has to be above the Priority 7, plus it is a U.S. Department of Housing and Urban Development geographic means tested that varies based upon where you live.

So the quote you gave of $27,000 doesn’t apply to San Francisco.  It does not apply to Boston.  It does not apply to New York.  Do you know what it is for San Francisco, the means test?  It goes up to $63,400.  That is a single veteran.  Then when you add that he has one dependent, it goes up another six and it keeps going up.  When you talk about New York, it is over $40,000. 

So you are talking about something that is much higher and allows people that are making $70,000 with one dependent to be eligible.  Now, I am not saying that we should not stop that, but I am saying let’s be understanding that even the Disabled American Veterans (DAV) have come out to say that they have some concerns.  And let me read what they say.  "The Category 8 issue is only a symptom of a larger problem and not the source of the problem itself."  And they caution us because they say that the budget restraints in the appropriation process and conditions still do not provide the disabled veterans all the funds they need.

Now, these are people that have served, are disabled, are functioning in a limited capability and we should obviously, as Members of this Committee, look at these people first and make sure that all the resources go these people and not necessarily disadvantage them to somebody who is a Priority 8 with no, non-service-connected, no disability, who is making almost $70,000 a year.  Obviously, Secretary Principi was trying to say to us, and it was a very difficult thing for him to do, was to say listen, I want to see the disabled veterans get the money first and then if we can, let’s take care of Priority 8.

Having said that, maybe with this new surge in the budget that the Chairman has provided this for, that we can take care of the disabled veteran to the point where the DAV is not feeling that they are disadvantaged and then we can provide money to the Priority 8.  But I do caution the Members that our job is to make the hard choices, not come up here and just continually vote to service more and more programs at the expense of the people who really need it.

So that is the only point I try to take.

Ms. BROWN OF FLORIDA.  Mr. Stearns—would you yield for a second?

Mr. STEARNS.  Sure.

Ms. BROWN OF FLORIDA.  In those categories that you were discussing, the financial area, you do know that our district, the $27,000 would apply?

Mr. STEARNS.  In your congressional district?

Ms. BROWN OF FLORIDA.  Not just my congressional district.  My congressional district borders your congressional district.  So we are talking about our mutual constituents.

Mr. STEARNS.  No, and I—we have one of the poorest in—

Ms. BROWN OF FLORIDA.  Okay.  I just wanted you to know—

Mr. STEARNS.  I understand that.

Ms. BROWN OF FLORIDA.  —that we share these constituents—

Mr. STEARNS.  You know, from Jacksonville, which is a large city in my congressional district, and yours, we both go through the University of Florida and Gainesville.  But we also have portions—I have Bradford County and other counties where obviously this would apply.  But again, I think you will agree with me, that we want to make sure the people that need it, get it without any problems and that is what my—

Ms. BROWN OF FLORIDA.  Yes.  And one other thing, I wish as you are discussing, that waste, fraud and abuse I brought up, the $12 billion that we can’t account for and if we were more conservative with the dollars, then we would be able to serve more veterans and make sure that they have the care that they need.

Mr. STEARNS.  Well, I will just conclude by saying, the Ranking Member Buyer made this point well when he talked about all the different problems that exist in the VA and we have been trying—interoperability, transparency, being able to get a hold of IT.  I mean he has gone through a litany of these problems that he feels are pretty important to servicing our veterans with not allowing waste, fraud and abuse.  So with that, Mr. Chairman, and I ask that my prepared statement can that be part of the record?

[The statement of Congressman Stearns appears in the Appendix.]

The CHAIRMAN.  Without objection.

Mr. Hall?


Mr. HALL OF NEW YORK.  Thank you, Mr. Chairman.  I also have a T&I markup to go to in a little bit.  So let me just say that this Priority 8 veterans situation is one of the things I hear about the most in my district from veterans.  I do understand Mr. Stearns’ concern and the Ranking Member’s concern about being able to provide service for an additional returning group of veterans at the same time that we are trying to bring the waiting times down and the service up for the veterans who are already taken care of.

So I am here to learn and to hear all the various facets of it.  But I would just mention that this geographical adjustment that allows the numbers to float from $27,000 to $40,000 or higher, in my district, and especially the County of Westchester is one of the five counties I represent, 23 percent of our homeless population are veterans and one of the reasons that might be is that $40,000 doesn’t go very far in Westchester County, nor does it in any of the other counties, and Hudson Valley. 

So those numbers might sound like a lot of money, but I think it is all relative and one needs to—and the law is written to try to take in these geographical differences.  But I really would like, if we can do this, I would be in favor of providing for our Priority 8’s and that is what we are here to learn about.  So thank you very much, Mr. Chairman.  I yield back.

The CHAIRMAN.  Any others on the Republican side? 

Ms. BROWN-WAITE.  Mr. Chairman?

The CHAIRMAN.  Yes.  Ms. Brown-Waite?

Ms. BROWN-WAITE.  I did prepare a statement which I would ask unanimous consent to be able to submit.

The CHAIRMAN.  Without objection, all written statements will be made a part of the record.

Ms. BROWN-WAITE.  I appreciate that very much.  Thank you.

[The statements of Congresswoman Ginny Brown-Waite, Congressman Miller and Congressman Mitchell appear in the Appendix.]

The CHAIRMAN.  Thank you.  Mr. Hare?


Mr. HARE.  Thank you, Mr. Chairman, I too have a markup here in a few minutes.  I admit to being new on this Committee and I understand there has been terms to describe me such as youthful, exuberance and, but you know, I just want to make myself very clear when it comes to this issue.  The reason that I am on the Committee, it seems to me, is to do everything I can as a Member of Congress to provide benefits for every veteran this country has.  I don’t care whether you are a Filipino veteran, Merchant Marine veteran, whether you happen to fall into this particular category that we are talking about today.

And I would just have to say to my friends across the curve here, and I repeat this often.  The question I think that we should be handling here, Mr. Chairman, is not can we afford to do these things.  The question is, the statement is we can’t afford not to do these things.  We make promise after promise after promise to different groups and yet we don’t keep them.  We are told we don’t have the money.  We do have the money.  We don’t have the will, it seems to me, and we don’t have a President, but that will change, to get somebody to stand up for our Nation’s veterans.

If you put people in harm’s way, you protect them from the minute you send them to the minute they come home and beyond.  That is what we are supposed to be about.  The VA estimates that lifting the ban would result in approximately 1.6 million veterans seeking healthcare.  Well, that is just a tragedy.  You know, woe to the poor VA.  Last year, Democrats estimated it would cost $341 million, including subtracting estimated collections to lift the enrollment ban.

And again, I know this may not seem like a lot of money to my friends, but again, I still, with all due respect, shake my head and wonder when we talk about, well, we have got to make sure we have the money, but we doled out almost, the VA doled out almost $4 million of their money to give benefits to people that most of them didn’t even have coming from my perspective. 

And I am angered by this because I—we had bills yesterday that came up.  We had a VA person come up who couldn’t answer us when these bills were going to—that the VA hadn’t even taken a look at them yet, and they were to help widows.  And they were to help people who had been injured, a person who lost his leg on a aircraft carrier in a training episode and the VA sits and tells us we will get back to you when the time is right for us.

Well, the time for us now, Mr. Chairman, I think is now.  And there are people that try to live on $27,000.  They are not high income.  And those who are combat decorated are shut out of the system because they make as little as $27,000.  My statement, again I go back, and I will continue to say this as long as I serve on this Committee and I support legislation to help veterans and I will continue to do that.  This is not whether or not we can afford to do this.  This is we cannot afford not to do this. 

And every time we have a piece of legislation that I believe is in the best interest of veterans in this country, I am not going to ask how much is it going to cost.  I am going to want to know how many veterans are going to be served by what we do here today.  That is how we should be judged, not on a dollar and cents basis.  I think that when we start doing that to our veterans, I think we diminish their service, because if you are serving—I don’t know what the price tag is for that widow who lost her husband in the United States Marine Corps. 

I have to make a call today to a mother who lost her son in Afghanistan.  What is the price?  I think enough of this whether or not we can afford it.  And I will say to you, Mr. Chairman, I will continue to work on this stuff.  But I applaud you for being steadfast in this and for standing up for what you believe in.  And you know, we are going to have battles on this Committee and we will have disagreements on this Committee.  But those disagreements should never be over whether or not we think we have got the cash available to help any group of veterans out that served this country.

And with that, I just want to say to the Priority 8 veterans from my perspective, you have these benefits coming and we are going to work very hard to make sure you get them.  To our Filipino vets, to our Merchant Marines and to our other people, I am not going to quit working and this Committee is not going to quit working until we provide the benefits that we promised people over 60 years ago.

And with that, Mr. Chairman, I thank you and I yield back.

The CHAIRMAN.  I thank the gentleman. 

Mr. BOOZMAN.  Mr. Chairman?

The CHAIRMAN.  Mr. Boozman?


Mr. BOOZMAN.  I would just—and again, I don’t disagree with what Mr. Hare is saying or the sentiment that he is expressing.  On the other hand, one of the things that we have worked really hard to do as a Committee—and everybody that is on this Committee, this certainly is not, we are not here for the glamour of the Committee or whatever.  We are here because we want to help people and want to help veterans.

But one of the things that we have really worked hard, and I think Congressman Stearns was alluding to this and Mr. Buyer and others, but we have really worked hard to get our wait times down.  That is the other thing that veterans get so frustrated, those that are in the system, you know, having to wait for appointments.  But I think at the very least—and again, I am sympathetic.  But in looking at the potential of going forward, then I would think that we probably want the VA to come up with a plan and tell us what kind of staffing we are talking about. 

What would that do to wait times?  How would you—what kind of facility increase and things as you put hundreds of thousands of people in the system, because again, I think we can be very proud that—we got two problems.  We want to serve as many people as we can.  On the other hand, those that we do serve, we want to do a very good job of serving.  And that has not always been the case in the past.

And to the Committee’s credit, working together in a very bipartisan way, I think we have worked very hard on that and we are continuing, I think we are going to continue to work on that under Mr. Michaud’s leadership, to continue to get our wait times down.  But that is a real problem.

So I would encourage, just like I said, at the very least, we need something from the VA as to how this would affect the system.  Thank you.

The CHAIRMAN.  Thank you, Mr. Boozman.


Mr. WALZ.  Well, thank you, Mr. Chairman, and to the Ranking Member.  And thank you, all the witnesses.  I know we are here to hear you and Dr. Woolhandler, thank you for your patience.  It is you that we are here to hear.  This is a very complicated issue and you hear the passion on both sides.  The one thing that is consistent amongst the people up here and with each of you is how best to treat our veterans, how best to ensure that they get the care that they so richly deserve and this Nation has an obligation to provide. 

I am glad to hear my colleague from Florida discuss the Disabled American Veterans and their concern about Priority 8.  And I know when our friends get up here and discuss that, they will take that, to which I think they are probably right on, the next step on this is full funding, mandatory funding.  So you can’t have half of that argument without making the second half of their argument, which is don’t just go with the Priority 8’s.  We need to get this all the way right with the full funding.

So I hope my colleague will embrace that along with me.  And I agree with my colleagues.  There are limited amount of resources and it is very, very clear that when you make a budget, it is a monetary exercise in terms of balancing a budget sheet.  But the second part of that is, it is a moral imperative, an ethical imperative.

And make no mistake about it, when we create a budget, what we are doing with those limited amount of resources is prioritizing our collective values as a Nation.  And I do not disagree that you must balance it.  I am absolutely adamant making sure with PAYGO and making sure we balance our budget.  It is very difficult for me, though, when you put all of these things out there on the budget sheet, be very clear about what you are saying yes to and what you are saying no to. 

It is very difficult for me to justify throwing Priority 8 people off of the rolls when we have the most massive tax cuts to the wealthiest amongst us, at a time when we are doing that, when we have massive subsidies to oil and gas companies at the same time we are telling veterans we don’t have the resources to accept them.

I will agree and absolutely adhere to the policy that there is limited resources that must be allocated accordingly to our Nation’s priorities.  My difficult is is when people prioritize those other things over what I believe is in the best interest of this Nation, not just morally taking care of our veterans, but from a security standpoint.

So I thank you.  I don’t want to take up any more of our distinguished witness’ time and I hope you can help enlighten us how we can best do this and serve all of our veterans. 

So I yield back, Mr. Chairman.

The CHAIRMAN.  Thank you, Mr. Walz.  And we will use that as an introduction to our panelist, Dr. Stephanie Woolhandler, who is Associate Professor of Medicine at Harvard Medical School and Co-Founder of Physicians for National Health Program.  We thank you for being here and look forward to your testimony.  We hope you will summarize your written, statement which will be made part of the record, in about five minutes and then we will be asking you questions.


Dr. WOOLHANDLER.  Okay.  Well, in my written testimony I am going to present, I detail information on health insurance coverage and problems and access to care for America’s veterans.  But all of this is data based on Federal studies, surveys carried out annually, one by the Census Bureau, and this is a 2005 Census Bureau data, and the other one, the National Health Interview Survey.  So it is mostly going to be about the data on how many veterans are actually uninsured.

We are going to find out how many veterans are uninsured and also, do these uninsured veterans suffer the same kind of problems and access to care that other uninsured Americans suffer.  Okay.

So based on the Census Bureau’s 2005 data, in 2004 there were 1.8 million military veterans who had neither health insurance, nor ongoing care at Veterans Health Administration’s (VHA) hospitals.  Now, you have to note the survey did ask veterans if they had health insurance and if they had veterans or military healthcare.  And we counted them as uninsured only if they answered no to both questions, that is, they had no insurance, they had no veterans or military healthcare.

The number of uninsured veterans was 1.8 million and it had increased by nearly 300,000 since 2000.  The proportion of non-elderly veterans who are uninsured rose from less than one in ten in 2000 and is currently one in eight.  One in eight non-elderly veterans has no health coverage.  An additional 3.8 million members of veterans’ households were also uninsured and of course, they are going to be ineligible for VA care. 

And then when we looked at who these uninsured veterans are, we found that virtually all Korean War and World War II veterans were covered by Medicare.  They are over the age of 65.  However, among Vietnam era veterans, there were nearly 700,000 who had no health coverage.  Among veterans who served in other eras, which would include the Persian Gulf War, 12.9 percent, 1.1 million veterans had no health coverage.  So people are returning from the Persian Gulf, 1.1 million of them have no health coverage when they get back.

Almost two-thirds of the uninsured veterans were employed and nearly nine out of ten had worked in the past year.  So these are indeed working Americans.  Most uninsured veterans, like other uninsured Americans, are working.  Many earn too little to afford health insurance, but too much to qualify for the means test at the VA or obviously from Medicaid.

Now, uninsured—when we looked at the problems that people had getting care, it turned out that uninsured veterans have the same problems getting care they need as other uninsured Americans.  Moreover, many of them have serious illnesses that should be getting medical care from doctors like me. 

Among uninsured veterans older than the age of 45, nearly one out of five were in fair or poor health, so they had health problems.  And nearly one in three uninsured veterans of all ages had at least one chronic condition that limited their ability to function.  A disturbingly high number of uninsured veterans reported needing medical care and not being able to get in the past year.  More than a quarter of uninsured veterans failed to get needed care due to cost.  Thirty-one percent had delayed care due to cost.  And among uninsured veterans, 44 percent had not seen any doctor or any nurse within the past year, and two-thirds said they got no preventive care anywhere.

By almost any measure, these uninsured veterans had as much trouble getting healthcare as any other uninsured American.  And that is the data part.  And now I am going to get to the opinion part of what I am going to say.

We believe the Veterans Health Administration is a rare success story in the American healthcare system.  Currently the VA offers more equitable care and higher quality care than the average care in the private sector.  And I have provided citations for that, several studies, scientific studies comparing care, show higher quality in the VA than the average care in the private sector.  And the VA has become a medical leader in research, primary care and computerization.

And while we support opening VA enrollment to all veterans, this would still leave many veterans unable to access care because they live far from VA facilities.  Moreover, even complete coverage of veterans would leave 3.8 million of their family members uninsured.  Hence, my colleagues and I support a universal national health insurance program that would work with and learn from the VA Health Administration system in covering all Americans.

Any questions?

[The statement of Dr. Woolhandler appears in the Appendix.]

The CHAIRMAN.  Thank you.  How would you, Doctor, respond to the basic issue raised by the Republican side here that you have just got to go with core constituencies which has no basis in law, as far as I know, by the way, that term, and other people will suffer if we allow, if we open the system up to more—

Dr. WOOLHANDLER.  Okay.  Well, I am a physician and when I think about priorities, I think the sickest people have the most priority.  So a sick person to me has a priority, whether they earn $28,000 or $26,000 a year.  The priority is to take care of sick people and what our data is showing is that many veterans have no coverage and they are sick and need care and can’t get it.

The CHAIRMAN.  Okay.  Questions from those who didn’t have statements opening?  Ms. Brown-Waite, did you have any questions?

Ms. BROWN-WAITE.  I would just like to ask the doctor, certainly you are a proponent of universal healthcare.  So if there is universal healthcare, do you see also the need for the VA healthcare system, or do you envision it all being under one universal healthcare?

Dr. WOOLHANDLER.  Okay.  Well, the VA has turned into a leader in American medicine.  It wasn’t that way when I went to medical school.  But in the years I have been practicing, it has gone from, if you will, something of a backwater of American medicine to a real leader.  Their computer systems are the best.  Their quality is the best.  So I think a national health insurance system should build on what is best in American healthcare and that is why I think the VA should and would continue to exist as an option with some sort of national health insurance system.

Ms. BROWN-WAITE.  So your concept would be universal healthcare for everyone in America and simultaneously the VA system to be there and to expand because of its excellence?


Ms. BROWN-WAITE.  Because we hear so many people tearing down the VA healthcare system, and certainly as a doctor you know there are errors made, unfortunately, every place, because it is a system that is carried out mostly by human beings and so there are certainly medical errors and bad judgment that takes place, whether it is in the VA or whether it is in the proprietary hospital setting.

But, so your concept is to have a VA run healthcare system along with universal healthcare?

Dr. WOOLHANDLER.  Okay.  Yes, it is—I don’t work for the VA.  I don’t work in a VA hospital.  What I am reporting is actually the scientific evidence that has come out in the medical literature over the last five years or so which does show that the quality is better at the VA than the average in the civilian sector.  National health insurance would give people their choice.  They could go to a private hospital, a public hospital, a VA hospital.  But if people are smart, they would take the national health insurance and then many instances choose VA care because the data is that the quality at the VA is at least as good, in many cases better, than civilian sector.

Ms. BROWN-WAITE.  You are absolutely right.  I have a huge, I have the second highest or the highest number of veterans of any member of Congress, Representative Miller from the panhandle and I, each year we go back and forth as to who has the highest number of veterans.  And I can tell you that my veterans are very, very supportive of the VA healthcare system, because they know that the quality exists there.

I yield back the balance of my time.

The CHAIRMAN.  Thank you. 

Ms. Herseth Sandlin?

Ms. HERSETH SANDLIN.  Thank you, Mr. Chairman.  Just maybe a couple of questions.  I understand there is a follow-up study that you and your colleagues have been undertaking; is that correct?

Dr. WOOLHANDLER.  Yes, there is.  These numbers that I gave today are the most recent numbers.


Dr. WOOLHANDLER.  But there is a full publication coming out this December.

Ms. HERSETH SANDLIN.  And are there any trends that you have been able to identify or changes?  I know there are some statistics here about half of the uninsured veterans in the survey had incomes that would make them completely ineligible for VHA enrollment because of the Priority Group 8 freeze.  What changes have you been able to determine for those Priority Group 8 veterans that were able to enroll prior to the freeze, their access to primary healthcare and to outpatient services as it relates to annual appointments with doctors and preventive care?  Are you doing anything to compare the relative health of those Priority 8 Group veterans versus those that are uninsured that are Priority Group 8 that didn’t get access to the veterans, to VHA?

Dr. WOOLHANDLER.  Okay.  The Census Bureau is not detailed enough for us to figure out precisely who is a Priority 8 and who isn’t.  Specifically, we don’t have any information in the Census Bureau about assets.  There is an assets test.  And so we can just be kind of approximate.  But things have not changed.  That is, about half of uninsured veterans have incomes above 250 percent of poverty and that hasn’t changed over the years.  And virtually none of them would be eligible other than as a Priority 8.  They would flunk the means test because of their income.

Ms. HERSETH SANDLIN.  I appreciate the response.

Mr. Chairman, I would just suggestion that perhaps working with the doctor or working with those that we meet with on a regular basis, with the veterans service organizations or officials in the VA, that it would be, I think, worthwhile to inquire as to a study—my concern here, separate from the equity issues and some of the statements made by my colleagues at the outset, is the issue of access to primary healthcare and the importance of cost savings over time of annual doctor’s appointments and preventive care and whether or not we can get an analysis of the healthcare received by Priority Group 8 veterans who got into the system before the freeze versus a subset of Priority Group 8 veterans who are uninsured and not getting access to that type of primary healthcare, to help make the case about the importance of having access to the system, understanding as most of the veterans I talked to who are Priority Group 8, that service-connected disabled veterans who are lower income are first in line, but they shouldn’t be disallowed from even getting into line.  And it might be something that would help shed light on the importance of the access to care.

I thank you and I yield back.

The CHAIRMAN.  Thank you very much.  Any questions on this side? 

Mr. Buyer?

Mr. BUYER.  Thanks.  Mr. Chairman, you mentioned about the reference to core constituency, you are correct, is not in law, but looking at the eligibility reform, it sets out for the Secretary the priorities of care that we all know about.  There is even a provision in here that says in the case of a veteran who is not described in the above paragraphs, the Secretary has the extensive resources and facilities available and subject to the provisions of F and G, has furnished hospital care, medical services and nursing home care which the Secretary determines to be needed.  I just wanted to let you know that when you say it is not in law, it is in law.

To the witness, I would just like for you to know that when you come to Congress and you want to present your paper, it was one of the most challenging things for to me to get beyond your title.  You titled it "Stains on the Flag" to promote your view of a social policy for a national healthcare system.  Very challenging for me to get beyond the title—I just want you to know that, very difficult and challenging to me, especially coming—now I will give you this view—from Harvard, from Harvard that has a faculty with an anti-military bias, so much so—let’s see, Harvard, you don’t even allow ROTC. 

You don’t allow military recruiters on your campus.  But that same Harvard, let’s see, you take the money.  You take students who go to Harvard who have ROTC, who will pay the money, but they have to go to class at MIT.  And you will take DoD grants because you want the money to enrich your school. 

But there is this 1960’s style of anti-military bias that still permeates at Harvard.  And when you come here and you title your paper about a stain on the flag, I just want you to know, to me as a veteran who served my country for 27 years in uniform, in war and in peace, I can’t get—it is hard for me to get beyond the title when I look at Harvard as an intolerant institution at times.  So I just share that with you.


Mr. BUYER.  It was challenging for me.  But I dove into this.  And so I just want to share to my VSO colleagues that are here, all right, we weren’t so crazy after all.  All of our off-sites and things, where I went and shared with you that there is a huge challenge here, a philosophical difference between those who believe in a private health system versus those who believe in a national health system or single-payer system.

And that is why the Chairman has this witness here.  And I don’t question the Chairman’s sincerity.  He told me in our budget hearing two years ago, I want the VA to be there to open up to all veterans and their dependents.  And so it is a bigger puzzle in the national health insurance pie and that is a reality that we have to challenge, that we have to struggle with, that I am going to try to struggle with.

But I just want to end with this.  One thing that we didn’t talk about in our opening statements—that was a very good dialogue, Mr. Chairman.  I am glad you allowed that to happen, because we also have all this influx of our veterans who are returning from the war and we just, you know, we just voted here to open it up for five years, which is even more.

So it is about preparing the system to receive them and we have been challenged here over the years in preparing that system and I think that is when the Secretary closed off the 8’s.  And he closed off the 8’s thinking that we could be a good mechanic—and I wish Mr. Michaud were still here—on all these systems’ analytical approaches and working with the VA and then we end up ourselves in a war.

And that was one of the reasons we wanted to give discretionary authority to the Secretary, because we couldn’t foresee what would happen into the future. 

But thank you, Mr. Chairman.

The CHAIRMAN.  Thank you, Mr. Buyer.

Dr. WOOLHANDLER.  I just want to respond to that.

The CHAIRMAN.  Please.

Dr. WOOLHANDLER.  With all due respect, sir, I think you are changing the subject.  This hearing is actually not about Harvard.  This hearing is about 1.8 million uninsured veterans.  And I grew up in Shreveport, Louisiana.  I have lived in a lot of different places.  And it breaks my heart to see veterans come in and not have any health coverage.  People come in, they haven’t had their blood pressure taken care of.  They haven’t had their diabetes taken care of.  They are selling their homes in order to pay for medicines.  And they are veterans.  But they just can’t get access to the VA care.  And the VA should be an important safety net for my patients and it is not.  And I do consider that a stain on America’s flag.

The CHAIRMAN.  Thank you.

Mr. Rodriguez?

Mr. RODRIGUEZ.  First of all, let me thank you for being here with us today.  And I wanted to ask you, we haven’t been able, apparently as a Nation, haven’t had the will or the votes to be able to come up with any form of universal healthcare.  So we have tried to go after it incrementally.  So looking at it from an incremental perspective, do you have any suggestions as to