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J. David Cox, R.N.

J. David Cox, R.N., American Federation of Government Employees, AFL-CIO, National Secretary-Treasurer

Dear Chairman and Members of the Subcommittee:

The American Federation of Government Employees (AFGE) appreciates the opportunity to present its views on recruitment and retention tools for the Veterans Health Administration (VHA) workforce.  AFGE represents more than 150,000 employees in the Department of Veterans Affairs (VA), more than two- thirds of whom are VHA professionals on the front lines treating the physical and mental health needs of our veteran population.

The vast majority of VHA’s workforce is covered by “pure Title 38” or “hybrid Title 38” personnel rules that were designed to recruit and retain personnel through a more flexible, shorter process.  A small number of direct patient care positions remain under Title 5, e.g., Nursing Assistants and Medical Technicians.  In practice, hiring and promotion under Title 38 have turned out to be anything but quick and streamlined processes, further contributing to VHA’s inability to adequately recruit and retain needed personnel. Applicants awaiting credentialing and salary offers leave for other positions because of long delays.  Current VHA employees are demoralized by delays and inequities in the Title 38 promotion process. The current credentialing system and boarding process for Title 38 should be evaluated to identify ways to eliminate these harmful disincentives.  

Congress has enacted a wide array of VHA recruitment and retention tools over the years that rely on educational assistance, pay, work schedules, and other workplace benefits to enable the VA medical facilities to compete with other health care systems for quality personnel. These tools complement VA’s most effective recruiting and retention tool: itself. Caring for our nation’s veterans in this world class health care system offers a professional opportunity like no other.  

So why is the VA reporting such alarming workforce shortage statistics? 2007 VA data shows that new employees are practically fleeing VHA: 77% of all RN resignations occur within the first five years, and other professions have equally high attrition rates (71% of physicians, 77% of pharmacists and 79% of Licensed Practical Nurses (LPN.))  As a result, VHA’s workforce is steadily aging: the average age is now at 48.3 years. In five years, 44% of the current workforce will be eligible for full retirement. By 2010, 22,000 of VA’s 35,000 registered nurses will be eligible to retire.

The VA pays dearly for its flawed retention and recruitment policies. The average VA-wide cost of turnover is $47 million for nurses, $90 million for physicians, and $9.6 million for pharmacists.

Chronic staffing shortages result in other significant costs. Since injured veterans cannot wait for replacements to come on board, VA medical facilities are increasingly relying on contract nurses and physicians as a stopgap solution – a very costly one at that. AFGE anxiously awaits the findings of the pending GAO study of the impact of contract nurses on VA health care quality and cost. The use of contract nurses also hurts morale: agency nurses are given more desirable shifts than senior staff nurses (in part because they lack the specialized skills to function independently on evening and night shifts). Agency nurses also lack familiarity with the VA’s unique health care IT systems and patient safety policies.

We also anxiously await the VA’s first report to Congress on how effective the 2004 Physicians and Dentists pay bill (PL 108-445) has been at achieving its top objective: reducing spending on costly fee basis physicians. Based on our members’ very mixed experiences with market pay and performance pay awards coming out of the new law, we are doubtful that the VA has achieved the law’s objectives.     

While an urgent response to VHA’s growing workforce shortage is warranted, we urge Congress to be wary of new fixes that promise success under old conditions, such as the Nursing Academy and Magnet hospitals, as will be discussed. Such approaches divert precious health care dollars away from direct patient care and hiring of needed health care professionals.  The same dollars can be put to better use investing in the excellent array of recruitment and retention tools that Congress has already created.  AFGE firmly believes that these tools can meet current staffing needs, if properly funded and managed.  

Funding is inextricably tied to recruitment and retention. As the Independent Budget points out, when VHA fails to receive its funding in a timely manner under a discretionary funding process, budget-strapped medical center directors are unable to adequately meet anticipated hiring needs.  

The effectiveness of the current tools also depends on adequate guidance from VA Central Office and regular Congressional oversight. VA’s implementation of recent nurse and physician legislation has been largely decentralized, leaving great discretion to directors to decide what incentives to offer to their staff and whether to allocate needed funds to achieve success.

Pay Incentives: VHA’s success with using pay to recruit and retain professionals has been mixed. Title 38 has always permitted management to offer hiring and retention bonuses and special pay increases to employees hired under this authority that are underutilized. Congress recently augmented this authority with two profession specific pay laws: 2001 nurse locality pay legislation and 2004 physician/dentist pay legislation. 

The nurse locality pay law had two primary objectives: provide VA registered nurses with the National Employment Cost Index (ECI) based portion of the annual federal pay raise, and give hospital directors the authority to conduct third party locality pay surveys in order to set competitive pay rates for VA nurses. Unlike other federal employees, nurse locality pay portion is still at the discretion of their facility directors. Directors regularly refuse, especially in competitive markets, to conduct equitable pay surveys, even in the face of serious recruitment and retention problems. Or they conduct separate surveys for rank-and-file and nurse supervisors and provide higher percentage increases to the latter.   

The key test of whether the nurse locality pay law is working is whether the VA is able to recruit and retain nurses, reduce reliance on costly agency nurses, mandate less overtime and properly match staffing with patient acuity. The VA has yet to provide evidence of success in these indicators.

The 2004 law (P.L 108-445) to provide more competitive pay to VA physicians and dentists has also had its share of roadblocks. Employee representatives were excluded from national level groups that set the pay ranges for market pay. Local compensation panels setting market pay for individual providers at each facility largely excluded the front line practitioners, despite requirements in the law to include them. In some cases, management excluded them overtly, in other cases; they “accidentally” forget to inform them when the panels were meeting.  AFGE’s requests for the survey data used by facilities to set market pay were denied without basis and after great delay.  In short, AFGE and the physicians and dentists at the front line do not know which surveys were used to set their pay or whether their pay is comparable to that of their peers. Anecdotally, we are aware of many examples where individual providers were denied market pay increases, and facilities that used questionable survey data to set pay.

The performance pay provisions in the 2004 law have been severely weakened, first by VA’s blanket reduction of the maximum award from $15,000 to $5,000 in the first year, and similar blanket caps of a few thousand dollars that continue to be imposed by many facility directors. Providers are also frustrated by the great delay in issuing criteria for receiving performance pay, the inability to have input into the development of these criteria, and the fact that many of the criteria were improper or unrealistic. Clearly, Congressional intent to use performance pay as a retention tool for physicians and dentists has been frustrated.

Again, the key test of whether the physician and dentist pay bill has fulfilled Congressional intent is whether the VA has been able to reduce the use of expensive fee basis physicians and dentists and fill vacancies at medical facilities. Hopefully, VA’s report to Congress will be released in the near future and shed some light on whether these objectives have been at least partially met.

We also urge Congress to consider other nurse pay fixes that will aid in recruitment and retention.  The VA cannot offer competitive pay to Certified Registered Nurse Anesthetists because under current law, they cannot earn more than facility nurse executives.  In addition,  we urge Congress to amend 38 USC § 7455 to remove the current cap on locality pay for Licensed Practical Nurses, as Congress previously did for physical therapists and pharmacists.

Educational Assistance: The Nursing Academy, the VA’s newest education-based recruitment tool carries a $40 million price tag for an initial five year pilot project. This initiative does not guarantee that the VA will be able to recruit any graduates of the Academy. VA already has an effective education-based tool in place that requires an employment commitment, and its effectiveness can be increased through better funding and management. The Employee Debt Reduction Program (EDRP) provides new graduates with educational loan repayments in exchange for a fixed period of employment at a VHA facility.  Our members report that nurses in hard-to-recruit geographic areas have been turned away because EDRP funds have been exhausted, while excess EDRP funds remain unused in other locations. The federal government also has longstanding upward mobility programs that could be used to recruit health care professionals from within the VA but they appear to be woefully underutilized.

Scheduling Incentives:

The nurse alternative work schedule provisions that Congress enacted in 2004  were intended to make the VA workplace a more desirable place to work by offering VA registered nurses the same popular  compressed work schedule (CWS) (full-time pay for three twelve hours days) that private nurses are offered. Again, funding problems and local discretion have frustrated Congressional intent. Local directors are reluctant to offer CWS in part because it requires them to hire additional staff and in part because of a reluctance to make change. Since they can’t afford to hire, they lose prospective nurses but cannot attract others to replace them so they end up spending far more on agency nurses.  We urge Congress to end this vicious cycle by ensuring that adequate funds are available for the VA to offer CWS and require the VA to conduct more oversight at the local level.

The second scheduling incentive that Congress included in the 2004 law (P.L. 108-445) was to reduce the VA’s reliance on mandatory overtime. The law prohibits the use of mandatory overtime except in cases of emergencies. To be competitive with other employers, all VA facilities should use the same, widely accepted, narrowly drawn definition of emergency adopted by a number of states to protect their nurses from excessive overtime.  Instead, each facility is permitted to invoke the emergency exception to mandate overtime, even when staffing shortages are a result of their own mismanagement and could have been easily anticipated.  AFGE urges Congress to adopt a statutory definition of emergency consistent with state law. In addition, the current overtime provision should also apply to Licensed Practical Nurses and Nursing Assistants. Finally, we urge Congress to strengthen and extend the current requirement that VHA certify as to status of overtime policies in all facilities. 

Other Recruitment and Retention Tools:

Greater employee voice: Magnet certification is regularly touted as a highly effective recruitment and retention tool for VHA, because among other alleged benefits, it provides greater involvement by front line nurses.  Long before magnets came on the scene, VHA endorsed employee involvement. That is why AFGE nurses regularly served on key committees such as patient safety, nurse innovation, qualification standards, and workforce planning. Sadly, we have been virtually excluded from such groups as of late. We doubt that magnet status will make VA management more open to front line employee participation.  What we are sure of is that many, many medical dollars are being diverted from patient care and nurse hiring in order to go to magnet certification fees and staff time to prepare magnet applications. This appears to be a questionable use of appropriated dollars as well as a questionable use of patient care dollars. 

Retirement benefits:  Currently, most federal employees covered by the FERS retirement system cannot apply unused sick leave toward retirement, while their counterparts under the older CSRS system can.  Congress carved out an exception under Title 38 for RNs several years ago.  We urge that this benefit be extended to all VHA personnel as an added incentive for staying with the VA. 

Equality for Part-Time Nurses: Part-time nurses represent a valuable untapped source of personnel for VHA, but they face two disincentives. First, even if they were previously full-time nurses with permanent status, they enter probationary status with no employee rights for an indefinite period if they become part-time. We urge Congress to give part-time nurses permanent status after working at the VA for the equivalent of two years full-time.  Part-time nurses are also denied most of the overtime, shift differential, and weekend premium pay earned by full-time nurses. To remain competitive with other employers who recognize the importance of flexible work schedules for nurses, the VA should update its policies for part-timers.

Other professionals appointed under 38 USC § 7401(1): AFGE supports H.R. 2790 to provide a full-time physician assistant advisor so that valuable role of physician assistants in VA health care can be better utilized.  We also encourage a renewed look at the status of the other professionals appointed under this authority as chiropractors, podiatrists, and optometrists who are increasingly playing a key role in the treatment of OIF/OEF veterans.


VHA clearly recognizes the recruitment and retention challenges that lie ahead. AFGE participated in the National Commission on VA Nursing several years ago that acknowledged that the “current and emerging gap between the supply of and demand for nurses may adversely affect the VA’s ability to meet the healthcare needs of those who have served our nation.”  We commend VHA for other efforts undertaken to address VHA workforce succession planning in recent years. We urge Congress to give the VA the financial support and direction it needs to address short and long term health care workforce needs in a cost effective manner that ensures that veterans receive high quality care.

Thank you.