[Congressional Bills 108th Congress]
[From the U.S. Government Publishing Office]
[S. 2484 Reported in Senate (RS)]

                                                       Calendar No. 713
108th CONGRESS
  2d Session
                                S. 2484

                          [Report No. 108-357]

  To amend title 38, United States Code, to simplify and improve pay 
  provisions for physicians and dentists, to authorize alternate work 
                schedules and executive pay for nurses.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                              June 1, 2004

Mr. Specter (by request) introduced the following bill; which was read 
        twice and referred to the Committee on Veterans' Affairs

                           September 23, 2004

  Reported by Mr. Specter, with an amendment and an amendment to the 
                                 title
 [Strike out all after the enacting clause and insert the part printed 
                               in italic]

_______________________________________________________________________

                                 A BILL


 
  To amend title 38, United States Code, to simplify and improve pay 
  provisions for physicians and dentists, to authorize alternate work 
                schedules and executive pay for nurses.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

<DELETED>SECTION 1. SHORT TITLE.</DELETED>

<DELETED>    This Act may be cited as the ``Department of Veterans 
Affairs Health Care Personnel Enhancement Act of 2003''.</DELETED>

<DELETED>SEC. 2. REFERENCES TO TITLE 38, UNITED STATES CODE.</DELETED>

<DELETED>    Except as otherwise expressly provided, whenever in this 
Act an amendment is expressed in terms of an amendment to a section or 
other provision, the reference shall be considered to be made to a 
section or other provision of title 38, United States Code.</DELETED>

<DELETED>SEC. 3. IMPROVEMENT AND SIMPLIFICATION OF PAY PROVISIONS FOR 
              PHYSICIANS AND DENTISTS.</DELETED>

<DELETED>    (a) Chapter 74 is amended--</DELETED>
        <DELETED>    (1) In section 7404b--</DELETED>
                <DELETED>    (A) by striking ``(1)'' after 
                ``(b)'';</DELETED>
                <DELETED>    (B) by striking the list of position 
                grades under the caption, ``Physician and dentist 
                schedule'' and inserting in lieu thereof the 
                following:</DELETED>
                <DELETED>``Physician grade.</DELETED>
                <DELETED>Dentist grade.''; and</DELETED>
                <DELETED>    (C) by striking paragraph (2) in its 
                entirety;</DELETED>
        <DELETED>    (2) In section 7404(c) by striking ``special''; 
        and</DELETED>
        <DELETED>    (3) By striking Subchapter III in its entirety and 
        inserting in lieu thereof the following sections:</DELETED>

  <DELETED>``SUBCHAPTER III--PAY FOR PHYSICIANS AND DENTISTS</DELETED>

<DELETED>``Sec. 7431. Pay authority</DELETED>
<DELETED>    ``(a) In order to recruit and retain highly qualified 
physicians and dentists in the Veterans Health Administration, the 
Secretary shall establish and periodically adjust the rates of pay for 
physicians and dentists based upon the factors specified in subsection 
(b). Total pay shall be benchmarked to representative salaries of non-
Department physicians, dentists, and health care clinician-
executives.</DELETED>
<DELETED>    ``(b) Pay for physicians and dentists employed in the 
Veterans Health Administration shall have three components:</DELETED>
        <DELETED>    ``(1) Base pay.--This shall be a uniform pay band 
        applicable nationwide. The minimum rate shall be the maximum 
        rate for Chief grade in the Veterans Health Administration 
        Physician and Dentist Pay Schedule in effect on the day before 
        the date of enactment of this Act. The maximum rate may not 
        exceed the rate of basic pay authorized by section 5316 of 
        title 5 for Level V of the Executive Schedule. The Secretary 
        shall adjust annually the minimum rate by the same percentage 
        as the adjustment under section 5303 of title 5 in the rates of 
        pay for the General Schedule, and the maximum rate in 
        accordance with section 5318 of title 5. Administration 
        facilities, under regulations prescribed by the Secretary, may 
        set individual base pay anywhere within the pay band.</DELETED>
        <DELETED>    ``(2) Market pay.--This shall be a variable pay 
        band based on geographic area, specialty, assignment, personal 
        qualifications, and individual experience, and shall be 
        established and adjusted locally in accordance with regulations 
        prescribed under subsection (c). Administration facilities will 
        set individual market pay in accordance with regulations 
        prescribed by the Secretary. The Under Secretary for Health 
        shall periodically review and recommend to the Secretary 
        adjustments to the market pay band based on published 
        healthcare workforce employment and compensation data. The 
        Secretary may adjust the market pay band periodically based on 
        the recommendations of the Under Secretary and in response to 
        changing health-care labor trends.</DELETED>
        <DELETED>    ``(3) Performance pay.--</DELETED>
                <DELETED>    ``(A) There shall be a variable pay band 
                linked to the physician's or dentist's achievement of 
                specific corporate goals and individual performance 
                objectives. Physicians and dentists other than those 
                specified in subsection (f)(1) shall not be eligible 
                for this component during the first year of 
                appointment. The amount payable to a physician or 
                dentist for this component may vary based on individual 
                achievement. The performance component paid to any 
                physician or dentist other than those specified in 
                subsection (f)(1) will be in accordance with 
                regulations prescribed by the Secretary and may not 
                exceed $10,000 in a year.</DELETED>
                <DELETED>    ``(B) In accordance with regulations 
                prescribed by the Secretary, ten percent of the 
                benchmark total pay for physicians and dentists 
                specified in subsection (f)(1) shall be linked to the 
                physician's or dentist's achievement of specific 
                corporate goals and individual performance objectives 
                as a performance component. Administration facilities 
                may set the performance pay in accordance with 
                regulations prescribed by the Secretary.</DELETED>
<DELETED>    ``(c) Compensation paid under this subchapter shall be 
considered pay for all purposes, included but not limited to retirement 
benefits under chapters 83 and 84 of title 5, United States Code, and 
other benefits. Notwithstanding the preceding sentence, amounts paid 
for performance pay under subsection (b)(3)(A) shall not be considered 
pay for retirement benefits under chapters 83 and 84 of title 5, United 
States Code.</DELETED>
<DELETED>    ``(d) Any decrease in pay that results from an adjustment 
to the market or performance component of a physician's or dentist's 
total compensation does not constitute an adverse action.</DELETED>
<DELETED>    ``(e) In no case may the total amount of compensation paid 
to a physician or dentist under this title in any one year exceed the 
amount of annual compensation (excluding expenses) specified in section 
102 of title 3, United States Code.</DELETED>
<DELETED>    ``(f) Covered Positions.--</DELETED>
        <DELETED>    ``(1) This subsection applies to physicians and 
        dentists in the following positions: Chiefs of Staff or 
        equivalent facility-level and Network-level clinical management 
        positions (including Network Clinical Service Managers), 
        facility and Network or Regional executive positions (including 
        Network Service Line Coordinators and Medical Center/Health 
        Care System Directors), Central Office executive positions, and 
        such other positions under this title as the Secretary may 
        determine in accordance with regulations prescribed in 
        accordance with section 7434(a).</DELETED>
        <DELETED>    ``(2) Notwithstanding the special relationships of 
        the Veterans Health Administration with affiliated institutions 
        under section 7302, physicians and dentists serving in covered 
        positions and receiving compensation under this subchapter may 
        not receive any compensation on or after the date specified in 
        regulations issued by the Secretary, through employment or 
        contract with, or negotiate or accept any offer of employment 
        from, any institution or other entity that is affiliated with 
        the VA medical center to which they are assigned, or affiliated 
        with a VA medical center which falls under their official 
        responsibilities. This limitation shall include receiving 
        compensation through or from practice groups or any other 
        entities associated with the affiliated institution(s), or from 
        entities under contract with the affiliated institution(s). 
        Compensation includes anything of monetary value, including but 
        not limited to honoraria, salary, and any fringe benefits such 
        as: tuition waiver, insurance protection, contributions to a 
        retirement fund, payment for books, below-market interest 
        loans, or employee discounts. Nothing in this section precludes 
        physicians and dentists in covered positions from holding 
        uncompensated appointments as other than officer, director, or 
        trustee with affiliated institutions in furtherance of section 
        7302.</DELETED>
        <DELETED>    ``(3) Subject to any conditions the Secretary may 
        be regulation prescribe, the Secretary may, on a case-by-case 
        basis, suspend or waive the limitation in paragraph (2) to an 
        individual physician or dentist, when necessary and appropriate 
        to carry out the purposes of section 7302, to assist 
        communities or practice groups to meet medical needs which 
        otherwise would not be met, or where the Secretary determines 
        that suspension or waiver would be in the best interest of the 
        United States. The Secretary shall make any suspension or 
        wavier made pursuant to this paragraph in writing.</DELETED>
<DELETED>``Sec. 7432. Transition to new pay system</DELETED>
<DELETED>    ``(a) All current special pay agreements entered into 
under the provisions of this subchapter in effect on the day before the 
date of enactment of this Act shall terminate on the date of enactment 
of this Act. Any physician or dentist in receipt of special pay on that 
date shall continue to be compensated as if such agreement were still 
in effect until the date specified in regulations issued by the 
Secretary implementing this new subchapter.</DELETED>
<DELETED>    ``(b) Physicians and dentists appointed or reassigned on 
or after the date of enactment of this Act, but before implementation 
of this subchapter shall be compensated in accordance with sections 
7404, 7405, 7433, 7434, 7435, and 7436, as applicable, in effect on the 
day before the date of enactment of this Act. Any such physician or 
dentist shall continue to be compensated at the applicable rates until 
such date specified in regulations issued by the Secretary implementing 
the new pay system. No special pay agreement will be required of any 
physician or dentist receiving such pay.</DELETED>
<DELETED>    ``(c) During the period from the date of enactment of this 
Act through the date of implementation of this subchapter, physicians 
and dentists paid pursuant to this section shall be subject to 
paragraphs (1), (2), (4), (5), and (6) of subsection (b) of section 
7438 in effect on the day before the date of enactment of this 
Act.</DELETED>
<DELETED>    ``(d) The amount of pay paid under this subchapter for a 
physician or dentist appointed before the effective date of regulations 
implementing this subchapter shall be not less than the amount of base 
pay and special pay such physician or dentist received under this title 
on the day before such effective date.</DELETED>
<DELETED>    ``(e) Special pay subject to the provisions of section 
7438, as in effect before the date of enactment of this section, or 
subject to subsection (c), paid to Veterans Health Administration 
physicians and dentists appointed before the effective date of 
regulations implementing this subchapter and who separate after such 
effective date, shall be fully creditable for purposes of computing 
benefits under chapters 83 and 84 of title 5.</DELETED>
<DELETED>``Sec. 7433. Pay for Under Secretary for Health</DELETED>
<DELETED>    ``(a) Section 5314 of title 5 establishes the base pay for 
the Under Secretary for Health at Level III of the Executive 
Schedule.</DELETED>
<DELETED>    ``(b) In addition to base pay under section 5314 of title 
5, the Under Secretary for Health shall be eligible for Market Pay 
under section 7431(b)(2).</DELETED>
<DELETED>    ``(c) Transition.--The current special pay agreement of 
the Under Secretary for Health entered into under the provisions of 
this subchapter in effect on the day before the date of enactment of 
this Act shall terminate on the date of enactment of this Act. The 
incumbent Under Secretary for Health on the date of enactment of this 
Act shall continue to receive special pay as if such agreement were 
still in effect until the date specified in regulations issued by the 
Secretary implementing this new subchapter. Any Under Secretary for 
Health appointed on or after the date of enactment of this Act, but 
before the date specified in regulations issued by the Secretary 
implementing this new subchapter, shall receive special pay in 
accordance with sections 7432(d)(2), 7433, and 7437(a) in effect on the 
day before the date of enactment of this Act.</DELETED>
<DELETED>``Sec. 7434. Administrative provisions</DELETED>
<DELETED>    ``(a) After receiving the recommendations of the Under 
Secretary for Health, the Secretary, pursuant to the authority in 
section 7421(a), shall prescribe regulations implementing the physician 
and dentist pay system established in this new subchapter. Such 
regulations shall include the method for computing the pay for all 
physicians and dentists in the Veterans Health Administration under 
this title.</DELETED>
<DELETED>    ``(b) Eighteen months after the Secretary issues 
regulations implementing this subchapter and annually thereafter for 
the next ten years, the Secretary shall provide to the Committees on 
Veterans' Affairs of the Senate and House of Representatives a report 
on the implementation of the authorities under this subchapter. Each 
report shall include:</DELETED>
        <DELETED>    ``(1) a description of the rates of pay in effect 
        during the preceding fiscal year with a comparison to the rates 
        in effect during the previous fiscal year by facility and by 
        specialty;</DELETED>
        <DELETED>    ``(2) the number of physicians and dentists who 
        left employment with the Veterans Health Administration during 
        the preceding year;</DELETED>
        <DELETED>    ``(3) the number of unfilled physician and dentist 
        positions in each specialty in the Veterans Health 
        Administration, the average and maximum lengths of time that 
        such positions have been unfilled, and a summary of the reasons 
        that such positions remain unfilled; and</DELETED>
        <DELETED>    ``(4) an assessment of the impact of 
        implementation of this subchapter on efforts to recruit and 
        retain physicians and dentists in the Veterans Health 
        Administration.</DELETED>
<DELETED>In addition, the first two reports following implementation of 
this subchapter shall also include a comparison of staffing levels, 
contract expenditures, and average salary of physicians and dentists by 
facility and specialty for the preceding and previous fiscal 
years.''.</DELETED>
<DELETED>    (b) The title and list of sections for Subchapter III in 
the table of sections at the beginning of Chapter 74 is amended to read 
as follows:</DELETED>
           ``subchapter iii--pay for physicians and dentists
<DELETED>``Sec. 7431. Pay authority.
<DELETED>``Sec. 7432. Transition to new pay system.
<DELETED>``Sec. 7433. Pay for Under Secretary for Health.
<DELETED>``Sec. 7434. Administrative provisions.''.

<DELETED>SEC. 4. ALTERNATE WORK SCHEDULES.</DELETED>

<DELETED>    (a) Chapter 74 is amended by adding a new section 
7456a:</DELETED>
<DELETED>``Sec. 7456a. Alternate work schedules</DELETED>
<DELETED>    ``(a) Coverage.--This section applies to registered nurses 
appointed under this chapter.</DELETED>
<DELETED>    ``(b) 36/40 Work Schedule.--</DELETED>
        <DELETED>    ``(1) Subject to paragraph (2), if the Secretary 
        determines it be necessary in order to obtain or retain the 
        services of registered nurses at any Department health-care 
        facility, the Secretary may provide, in the case of nurses 
        employed at such facility, that such nurses who work three 
        regularly scheduled 12-hour tours of duty within a workweek 
        shall be considered for all purposes (except computation of 
        full-time equivalent employees for the purposes of determining 
        compliance with personnel ceilings) to have worked a full 40-
        hour basic workweek.</DELETED>
        <DELETED>    ``(2)(A) Basic and additional pay for a registered 
        nurse who is considered under paragraph (1) to have worked a 
        full 40-hour basic workweek shall be subject to subparagraphs 
        (B) and (C).</DELETED>
        <DELETED>    ``(B) The hourly rate of basic pay for such a 
        nurse for service performed as part of a regularly scheduled 
        36-hour tour of duty within the workweek shall be derived by 
        dividing the nurse's annual rate of basic pay by 
        1,872.</DELETED>
        <DELETED>    ``(C)(i) Such a nurse who performs a period of 
        service in excess of such nurse's regularly scheduled 36-hour 
        tour of duty within a workweek is entitled to overtime pay 
        under section 7453(e) of this title, or other applicable law, 
        for officially ordered or approved service performed in excess 
        of eight hours on a day other than a day on which such nurse's 
        regularly scheduled three 12-hour tours fall, or in excess of 
        12 hours for any day included in the regularly scheduled 36-
        hour tour of duty, or in excess of 40 hours during an 
        administrative workweek.</DELETED>
        <DELETED>    ``(ii) Except as provided in subparagraph (i), a 
        registered nurse to whom this subsection is applicable is not 
        entitled to additional pay under section 7453 of this title, or 
        other applicable law, for any period included in a regularly 
        scheduled 12-hour tour of duty.</DELETED>
        <DELETED>    ``(3) A nurse who works a 36/40 work schedule 
        described in this subsection who is absent on approved sick 
        leave or annual leave during a regularly scheduled 12-hour tour 
        of duty shall be charged for such leave at a rate of ten hours 
        of leave for nine hours of absence.</DELETED>
<DELETED>    ``(c) 7/7 Work Schedule.--</DELETED>
        <DELETED>    ``(1) Subject to paragraph (2), if the Secretary 
        determines it be necessary in order to obtain or retain the 
        services of registered nurses at any Department health-care 
        facility, the Secretary may provide, in the case of nurses 
        employed at such facility, that such nurses who work seven 
        regularly scheduled 10-hour tours of duty, with seven days off 
        duty, within a two-week pay period, shall be considered for all 
        purposes (except computation of full-time equivalent employees 
        for the purposes of determining compliance with personnel 
        ceilings) to have worked a full 80 hours for the pay 
        period.</DELETED>
        <DELETED>    ``(2)(A) Basic and additional pay for a registered 
        nurse who is considered under paragraph (1) to have worked a 
        full 80-hour pay period shall be subject to subparagraphs (B) 
        and (C).</DELETED>
        <DELETED>    ``(B) The hourly rate of basic pay for such a 
        nurse for service performed as part of a regularly scheduled 
        70-hour tour of duty within the pay period shall be derived by 
        dividing the nurse's annual rate of basic pay by 
        1,820.</DELETED>
        <DELETED>    ``(C)(i) Such a nurse who performs a period of 
        service in excess of such nurse's regularly scheduled 70-hour 
        tour of duty within a pay period is entitled to overtime pay 
        under section 7453(e) of this title, or other applicable law, 
        for officially ordered or approved service performed in excess 
        of eight hours on a day other than a day on which such nurse's 
        regularly scheduled seven 10-hour tours fall, or in excess of 
        10 hours for any day included in the regularly scheduled 70-
        hour tour of duty, or in excess of 80 hours during a pay 
        period.</DELETED>
        <DELETED>    ``(ii) Except as provided in subparagraph (i), a 
        registered nurse to whom this subsection is applicable is not 
        entitled to additional pay under section 7453 of this title, or 
        other applicable law, for any period included in a regularly 
        scheduled 10-hour tour of duty.</DELETED>
        <DELETED>    ``(3) A nurse who works a 7/7 work schedule 
        described in this subsection who is absent on approved sick 
        leave or annual leave during a regularly scheduled 12-hour tour 
        of duty shall be charged for such leave at a rate of eight 
        hours of leave for seven hours of absence.</DELETED>
<DELETED>    ``(d) 9-Month Work Schedule.--The Secretary may authorize 
a registered nurse appointed under section 7405, with the nurse's 
written consent, to work full-time for nine months with three months 
off duty, within a fiscal year, and be paid at 75 percent of the full-
time rate for such nurse's grade for each pay period of such fiscal 
year. Such employee shall be considered a .75 full-time equivalent 
employee in computing full-time equivalent employees for the purposes 
of determining compliance with personnel ceilings. Service on this 
schedule shall be considered part-time service for purposes of 
computing benefits under chapters 83 and 84 of title 5.</DELETED>
<DELETED>    ``(e) The Secretary shall prescribe regulations for the 
implementation of this section.''.</DELETED>
<DELETED>    (b) The title and list of sections for Subchapter IV in 
the table of sections at the beginning of Chapter 74 is amended to read 
as follows:</DELETED>
    ``subchapter iv--pay for nurses and other health-care personnel
<DELETED>``Sec. 7451. Nurses and other health-care personnel: 
                            competitive pay.
<DELETED>``Sec. 7452. Nurses and other health-care personnel: 
                            administration of pay.
<DELETED>``Sec. 7453. Nurses: additional pay.
<DELETED>``Sec. 7454. Physician assistants and other health care 
                            professionals: additional pay.
<DELETED>``Sec. 7455. Increases in rates of basic pay.
<DELETED>``Sec. 7456. Nurses: special rules for weekend duty.
<DELETED>``Sec. 7456a. Alternate work schedules.
<DELETED>``Sec. 7457. On-call pay.
<DELETED>``Sec. 7458. Recruitment and retention bonus pay.''.

<DELETED>SEC. 5. NURSE EXECUTIVE SPECIAL PAY.</DELETED>

<DELETED>    (a) Section 7452 is amended by adding at the end 
thereof:</DELETED>
<DELETED>    ``(g)(1) In order to recruit and retain highly qualified 
Department nurse executives, the Secretary, in accordance with 
regulations the Secretary shall prescribe, shall pay special pay to the 
nurse executive at each Department health-care facility or at Central 
Office.</DELETED>
<DELETED>    ``(2) Special pay paid under paragraph (1) shall be a 
minimum of $10,000 and a maximum of $25,000. The amount paid to each 
nurse executive shall be based on factors such as the grade of the 
nurse executive position, the scope and complexity of the nurse 
executive position, the nurse executive's personal qualifications, the 
characteristics of the health-care facility, e.g., tertiary, single 
site or multi-site, nature and number of specialty care units, 
demonstrated recruitment and retention difficulties, and such other 
factors the Secretary deems appropriate.</DELETED>
<DELETED>    ``(3) Special pay paid under paragraph (1) shall be in 
addition to any other pay (including basic pay) and allowances to which 
the nurse executive is entitled, and shall be considered pay for all 
purposes, including but not limited to retirement benefits under 
chapters 83 and 84 of title 5, United States Code, and other benefits, 
but shall not be considered basic pay for purposes of adverse actions 
under subchapter V.''.</DELETED>

<DELETED>SEC. 6. EFFECTIVE DATE.</DELETED>

<DELETED>    The amendments to title 38, United States Code, contained 
herein shall take effect on the first day of the first pay period on or 
after the later of April 1, 2004, or six months after the date of 
enactment.</DELETED>

<DELETED>SEC. 7. ADMINISTRATIVE PROVISION.</DELETED>

<DELETED>    (a) Chapter 74 is amended by adding a new section 
7427:</DELETED>
<DELETED>``Sec. 7427. Functions</DELETED>
<DELETED>    ``The functions assigned to the Secretary and other 
officers of the Department of Veterans Affairs under this chapter are 
vested in their discretion.''</DELETED>

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Department of Veterans Affairs 
Health Care Personnel Enhancement Act of 2004''.

SEC. 2. REFERENCES TO TITLE 38, UNITED STATES CODE.

    Except as otherwise expressly provided, whenever in this Act an 
amendment is expressed in terms of an amendment to a section or other 
provision, the reference shall be considered to be made to a section or 
other provision of title 38, United States Code.

SEC. 3. SIMPLIFICATION AND IMPROVEMENT OF GRADE AND PAY PROVISIONS FOR 
              PHYSICIANS AND DENTISTS.

    (a) Simplification of Grades and Grade Requirements.--Section 
7404(b) is amended--
            (1) by striking ``(1)'' after ``(b)'';
            (2) in the Physician and Dentist Schedule, by striking the 
        items relating to the grades and inserting the following:
            ``Physician grade.
            ``Dentist grade.''; and
            (3) by striking paragraph (2).
    (b) Simplification and Improvement of Pay Authorities.--Subchapter 
III of chapter 74 is amended to read as follows:

           ``SUBCHAPTER III--PAY FOR PHYSICIANS AND DENTISTS

``Sec. 7431. Pay
    ``(a) Elements of Pay.--Pay of physicians and dentists in the 
Veterans Health Administration shall consist of three elements as 
follows:
            ``(1) Base pay as provided for under subsection (b).
            ``(2) Market pay as provided for under subsection (c).
            ``(3) Incentive pay as provided for under subsection (d).
    ``(b) Base Pay.--One element of pay for physicians and dentists 
shall be base pay. Base pay shall meet the following requirements:
            ``(1) Each physician and dentist is entitled to base pay 
        determined under the Physician and Dentist Base and Longevity 
        Pay Schedule.
            ``(2) The Physician and Dentist Base and Longevity Pay 
        Schedule is composed of 15 rates of base pay designated, from 
        the lowest rate of pay to the highest rate of pay, as base pay 
        steps 1 through 15.
            ``(3) The rate of base pay payable to a physician or 
        dentist is based on the total number of the years of the 
        service of the physician or dentist in the Veterans Health 
        Administration as follows:

``For a physician or dentist                    The rate of base pay is
   with total service of:                         the rate payable for:
    two years or less.............................              step 1 
    more than 2 years and not more than 4 years...              step 2 
    more than 4 years and not more than 6 years...              step 3 
    more than 6 years and not more than 8 years...              step 4 
    more than 8 years and not more than 10 years..              step 5 
    more than 10 years and not more than 12 years.              step 6 
    more than 12 years and not more than 14 years.              step 7 
    more than 14 years and not more than 16 years.              step 8 
    more than 16 years and not more than 18 years.              step 9 
    more than 18 years and not more than 20 years.             step 10 
    more than 20 years and not more than 22 years.             step 11 
    more than 22 years and not more than 24 years.             step 12 
    more than 24 years and not more than 26 years.             step 13 
    more than 26 years and not more than 28 years.             step 14 
    more than 28 years............................             step 15.
            ``(4) At the same time as rates of basic pay are increased 
        for a year under section 5303 of title 5, the Secretary shall 
        increase each rate of base pay payable under this subsection 
        for that year by a percentage equal to the percentage by which 
        rates of basic pay are increased under such section for that 
        year.
    ``(c) Market Pay.--One element of pay for physicians and dentists 
shall be market pay. Market pay shall meet the following requirements:
            ``(1) Subject to paragraph (3), each physician and dentist 
        is eligible for market pay.
            ``(2) Market pay shall consist of pay intended to reflect 
        the value to the Veterans Health Administration of the skills, 
        experience, and availability of a particular physician or 
        dentist within a particular health care labor market.
            ``(3) The annual amount of the market pay payable to a 
        physician or dentist shall be determined by the Secretary on a 
        case-by-case basis, subject to paragraph (5). The sum of the 
        total amount of the market pay determined for a physician or 
        dentist under this subsection and the annual rate of base pay 
        payable to the physician or dentist under subsection (b) may 
        not be less than the minimum amount, nor more than the maximum 
        amount, applicable to the physician or dentist under paragraph 
        (4).
            ``(4)(A) Not less often than once every two years, the 
        Secretary shall prescribe for Departmentwide applicability the 
        minimum and maximum amounts of annual pay (excluding incentive 
        pay under subsection (d)) that may be paid under this section 
        to physicians and the minimum and maximum amounts of annual pay 
        (excluding incentive pay under subsection (d)) that may be paid 
        under this section to dentists.
            ``(B) The Secretary may prescribe for Departmentwide 
        applicability under this paragraph separate minimum and maximum 
        amounts of pay for a specialty or subspecialty. If the 
        Secretary prescribes separate minimum and maximum amounts for a 
        specialty or subspecialty, the Secretary may establish up to 
        four tiers of minimum and maximum amounts for such specialty or 
        subspecialty and prescribe for each tier a minimum amount and a 
        maximum amount that the Secretary determines appropriate for 
        the professional responsibilities, professional achievements, 
        and administrative duties of the physicians or dentists (as the 
        case may be) whose pay is set within that tier.
            ``(5)(A) In determining the amount of the market pay for a 
        physician or dentist and determining a tier (if any) to apply 
        to a physician or dentist under paragraph (4)(B), the Secretary 
        shall consult with and consider the recommendations of the 
        Medical Professional Standards Board for the medical facility 
        of the Department at which the physician or dentist is 
        employed, except in the case of a physician or dentist whose 
        market pay is determined under subparagraph (B).
            ``(B) In the case of a physician or dentist who is a member 
        of a Medical Professional Standards Board, the Secretary shall 
        determine the amount of the market pay and the tier (if any) 
applicable to the physician or dentist under paragraph (4)(B) in 
accordance with such procedures and standards as the Secretary shall 
prescribe. Such procedures and standards shall, to the maximum extent 
practicable, be similar to the procedures and standards applicable to 
determinations of the amount of market pay and the tier applicable to 
physicians and dentists under paragraph (4)(B) who are not members of a 
board. Under such regulations, no member of a board may participate in 
or have a consultative role in determining the amount of market pay or 
tier of such member or any other member of such board.
            ``(C) A Medical Professional Standards Board consulted 
        under this subparagraph shall consist of at least three and not 
        more than five persons, each of whom is either a physician or a 
        dentist. Not less than a majority of the members of the board 
        shall be practicing clinicians in their professions.
            ``(6) Subject to paragraph (7), the determination of the 
        amount of market pay of a physician or dentist shall take into 
        account--
                    ``(A) the level of experience of the physician or 
                dentist in the specialty or subspecialty of the 
                physician or dentist;
                    ``(B) the need for the specialty or subspecialty of 
                the physician or dentist at the Department facility 
                concerned;
                    ``(C) the health care labor market for the 
                specialty or subspecialty of the physician or dentist, 
                which may cover any geographic area the Secretary 
                considers appropriate for the specialty or 
                subspecialty;
                    ``(D) the professional reputation of the physician 
                or dentist;
                    ``(E) the board certifications, if any, of the 
                physician or dentist;
                    ``(F) the prior experience, if any, of the 
                physician or dentist as an employee of the Veterans 
                Health Administration; and
                    ``(G) such other considerations as the Secretary 
                considers appropriate.
            ``(7) The amount that any consideration specified in 
        paragraph (6) may contribute to the amount of market pay may 
        not exceed, or be less than, such amount as the Secretary may 
        specify in regulations prescribed under section 7433 of this 
        title, or in directives issued for purposes of this subsection.
            ``(8) In determining amounts of market pay, the Secretary--
                    ``(A) shall consult two or more national surveys of 
                pay for physicians or dentists, as applicable, whether 
                prepared by public, private, or quasi-public entities; 
                and
                    ``(B) may utilize the recommendations or assistance 
                of one or more boards of physicians or dentists, as 
                applicable, that are appointed by the Secretary for 
                purposes of this subsection.
            ``(9) The amount of market pay of a physician or dentist 
        shall be adjusted at such times as the Secretary considers 
        appropriate in order to ensure the retention of qualified 
        physicians and dentists by the Veterans Health Administration.
            ``(10) The amount of market pay of a physician or dentist 
        shall be evaluated by the Secretary not less often than once 
        every 24 months. The amount of market pay may be adjusted as 
        the result of an evaluation under this paragraph. A physician 
        or dentist whose market pay is increased by reason of an 
        evaluation under this paragraph shall receive written notice of 
        the increase in accordance with procedures prescribed under 
        section 7433 of this title.
            ``(11) No adjustment of the amount of market pay of a 
        physician or dentist under paragraph (9) or (10) may result in 
        a reduction of the amount of market pay of the physician or 
        dentist.
    ``(d) Incentive Pay.--One element of pay for physicians and 
dentists shall be incentive pay. Incentive pay shall meet the following 
requirements:
            ``(1) Each physician and dentist is eligible for incentive 
        pay.
            ``(2) Incentive pay shall consist of an amount intended to 
        recognize outstanding contributions by a physician or dentist 
        to--
                    ``(A) the facility in which employed;
                    ``(B) the furnishing of care to veterans; or
                    ``(C) the practice of medicine or dentistry, as 
                applicable.
            ``(3) The amount of incentive pay shall be determined for a 
        physician or dentist by the Secretary.
            ``(4) The amount of incentive pay shall be determined for a 
        physician or dentist on a case-by-case basis.
            ``(5) The amount of incentive pay paid to a physician or 
        dentist in a calendar year may not exceed $10,000.
    ``(e) Delegation of Responsibilities.--The Secretary may delegate 
to an appropriate officer or employee of the Department any 
responsibility of the Secretary under subsection (c) or (d), except for 
the responsibilities of the Secretary under subsection (c)(4).
    ``(f) Limitation on Total Compensation.--In no case may the total 
amount of compensation paid to a physician or dentist under this 
section in any year exceed the amount of annual compensation (excluding 
expenses) specified in section 102 of title 3.
    ``(g) Treatment of Pay.--(1) Except as provided in paragraph (2), 
pay under this subchapter shall be considered pay for all purposes, 
including retirement benefits under chapters 83 and 84 of title 5 and 
other benefits.
    ``(2) Incentive pay under subsection (d) shall not be considered 
pay for purposes of retirement benefits under chapters 83 and 84 of 
title 5.
    ``(h) Decreases in Certain Pay Not Treatable as Adverse Action.--A 
decrease in pay of a physician or dentist resulting from an adjustment 
in the amount of incentive pay of the physician or dentist under 
subsection (d) shall not be treated as an adverse action.
``Sec. 7432. Pay of Under Secretary for Health
    ``(a) Base Pay.--The base pay of the Under Secretary for Health 
shall be the annual rate of basic pay for positions at Level III of the 
Executive Schedule under section 5314 of title 5.
    ``(b) Market Pay.--(1) In the case of an Under Secretary for Health 
who is also a physician or dentist, in addition to the base pay 
specified in subsection (a) the Under Secretary for Health may also be 
paid the market pay element of pay of physicians and dentists under 
section 7431(c) of this title.
    ``(2) The amount of market pay of the Under Secretary for Health 
under this subsection shall be established by the Secretary.
    ``(3) In establishing the amount of market pay of the Under 
Secretary for Health under this subsection, the Secretary shall utilize 
an appropriate health care labor market selected by the Secretary for 
purposes of this subsection.
``Sec. 7433. Administrative matters
    ``(a) Regulations.--(1) The Secretary shall prescribe regulations 
relating to the pay of physicians and dentists in the Veterans Health 
Administration under this subchapter.
    ``(2) In prescribing the regulations, the Secretary shall take into 
account the recommendations of the Under Secretary for Health on the 
administration of this subchapter.
    ``(b) Reports.--(1) Not later than 18 months after the Secretary 
prescribes the regulations required by subsection (a), and annually 
thereafter for the next 10 years, the Secretary shall submit to the 
Committees on Veterans' Affairs of the Senate and House of 
Representatives a report on the pay of physicians and dentists in the 
Veterans Health Administration under this subchapter.
    ``(2) Each report under this subsection shall include the 
following:
            ``(A) A description of the rates of pay in effect during 
        the preceding fiscal year with a comparison to the rates in 
        effect during the fiscal year preceding fiscal year, set forth 
        by facility and by specialty.
            ``(B) The number of physicians and dentists who left the 
        Veterans Health Administration during the preceding fiscal 
        year.
            ``(C) The number of unfilled physician positions and 
        dentist positions in each specialty in the Veterans Health 
        Administration, the average and maximum lengths of time that 
        such positions have been unfilled, and an assessment of the 
        reasons that such positions remain unfilled.
            ``(D) An assessment of the impact of implementation of this 
        subchapter on efforts to recruit and retain physicians and 
        dentists in the Veterans Health Administration.
    ``(3) The first two annual reports under this subsection shall also 
include a comparison of staffing levels, contract expenditures, and 
average salaries of physicians and dentists in the Veterans Health 
Administration for the fiscal year preceding such report and for the 
fiscal year preceding such fiscal year, set forth by facility and by 
specialty.''.
    (c) Initial Rates of Base Pay for Physicians and Dentists.--The 
initial rates of base pay established for the base pay steps under the 
Physician and Dentist Base and Longevity Pay Schedule provided in 
section 7431(b) of title 38, United States Code (as added by subsection 
(b)), are as follows:

Base Pay Step:                                             Rate of Pay:
    1.............................................             $90,000 
    2.............................................             $93,000 
    3.............................................             $96,000 
    4.............................................             $99,000 
    5.............................................            $102,000 
    6.............................................            $105,000 
    7.............................................            $108,000 
    8.............................................            $111,000 
    9.............................................            $114,000 
    10............................................            $117,000 
    11............................................            $120,000 
    12............................................            $123,000 
    13............................................            $127,000 
    14............................................            $130,000 
    15............................................            $133,000.
    (d) Transition Provisions.--
            (1) Physicians and dentists.--
                    (A) Pay.--(i) A physician or dentist in receipt of 
                pay under section 7404 or 7405 of title 38, United 
                States Code, as of the day before the date of the 
                enactment of this Act shall continue to receive pay 
                under such section (as in effect on the day before the 
                date of the enactment of this Act) until the effective 
                date of this Act under section 8 of this Act.
                    (ii) A physician or dentist appointed or reassigned 
                on or after the date of the enactment of this Act, but 
                before the effective date of this Act, shall be 
                compensated in accordance with applicable provisions of 
                section 7404 or 7405 of title 38, United States Code 
                (as in effect on the day before date of the enactment 
                of this Act), until the effective date of this Act.
                    (B) Special pay.--(i) A special pay agreement 
                entered into by a physician or dentist under subchapter 
                III of chapter 74 of title 38, United States Code, 
                before the date of the enactment of this Act shall 
                terminate on the date of the enactment of this Act. 
                However, a physician or dentist in receipt of special 
                pay pursuant to such an agreement on that date shall 
                continue to receive special pay under the terms of such 
                agreement until the effective date of this Act.
                    (ii) A physician or dentist described in 
                subparagraph (A)(ii) may be paid special pay under 
                applicable provisions of section 7433, 7434, 7435, or 
                7436 of title 38, United States Code (as in effect on 
                the day before the date of the enactment of this Act), 
                during the period beginning on the date appointment or 
                reassignment of such physician or dentist, as the case 
                may be, and ending on the effective date of this Act. 
                However, no special pay agreement shall be required for 
                the payment of special pay under this clause.
                    (C) Treatment of special pay.--(i) Special pay paid 
                under subparagraph (B) shall be subject to the 
                provisions of paragraphs (1), (2), (4), (5), and (6) of 
                section 7438(b) of title 38, United States Code (as in 
                effect on the day before the date of the enactment of 
                this Act).
                    (ii) Special pay paid under subparagraph (B) shall 
                be fully creditable for purposes of computing benefits 
                under chapters 83 and 84 of title 5, United States 
                Code.
                    (D) Preservation of pay.--The amount of pay paid 
                under subchapter III of chapter 74 of title 38, United 
                States Code (as amended by subsection (a)), to a 
                physician or dentist appointed or reassigned before the 
                effective date of this Act may be not less than the 
                aggregate amount of pay and special pay paid to the 
                physician or dentist under chapter 74 of title 
38, United States Code (as in effect on the day before the date of the 
enactment of this Act), as of the day before the effective date of this 
Act.
            (2) Under secretary for health.--
                    (A) Special pay.--(i) The current special pay 
                agreement entered into by the Under Secretary for 
                Health under subchapter III of chapter 74 of title 38, 
                United States Code, before the date of the enactment of 
                this Act shall terminate on the date of the enactment 
                of this Act. However, the Under Secretary shall 
                continue to receive special pay under the terms of such 
                agreement until the effective date of this Act.
                    (ii) An individual appointed as Under Secretary for 
                Health on or after the date of the enactment of this 
                Act and before the effective date of this Act shall be 
                paid special pay in accordance with the provisions of 
                section 7432(d)(2), 7433, and 7437(a) of title 38, 
                United States Code (as in effect on the day before the 
                date of the enactment of this Act), during the period 
                beginning on the date of appointment and ending on the 
                effective date of this Act. However, no special pay 
                agreement shall be required for the payment of special 
                pay under this clause.
                    (B) Treatment of special pay.--Special pay paid 
                under subparagraph (A) shall be fully creditable for 
                purposes of computing benefits under chapters 83 and 84 
                of title 5, United States Code.
    (e) Conforming Amendment.--Section 7404(c) is amended by striking 
``special pay'' and inserting ``pay''.
    (f) Clerical Amendment.--The table of sections at the beginning of 
chapter 74 is amended by striking the items relating to subchapter III 
and inserting the following new items:

                              ``SUBCHAPTER III--PAY FOR PHYSICIANS AND 
                                        DENTISTS
``Sec. 7431. Pay.
``Sec. 7432. Pay of Under Secretary for Health.
``Sec. 7433. Administrative matters.''.

SEC. 4. ALTERNATE WORK SCHEDULES FOR REGISTERED NURSES.

    (a) In General.--(1) Chapter 74 is amended by inserting after 
section 7456 the following new section:
``Sec. 7456A. Nurses: alternate work schedules
    ``(a) Applicability.--This section applies to registered nurses 
appointed under this chapter.
    ``(b) 36/40 Work Schedule.--(1) Subject to paragraph (2), if the 
Secretary determines it be necessary in order to obtain or retain the 
services of registered nurses at any Department health-care facility, 
the Secretary may provide, in the case of nurses employed at such 
facility, that such nurses who work three regularly scheduled 12-hour 
tours of duty within a workweek shall be considered for all purposes 
(except computation of full-time equivalent employees for the purposes 
of determining compliance with personnel ceilings) to have worked a 
full 40-hour basic workweek.
    ``(2)(A) Basic and additional pay for a nurse who is considered 
under paragraph (1) to have worked a full 40-hour basic workweek shall 
be subject to subparagraphs (B) and (C).
    ``(B) The hourly rate of basic pay for a nurse covered by this 
paragraph for service performed as part of a regularly scheduled 36-
hour tour of duty within the workweek shall be derived by dividing the 
nurse's annual rate of basic pay by 1,872.
    ``(C)(i) A nurse covered by this paragraph is entitled to overtime 
pay for work performed in such periods as the Secretary shall 
prescribe.
    ``(ii) Except as otherwise provided in clause (i), a nurse covered 
by this paragraph is not entitled to additional pay under section 7453 
of this title, or other applicable law, for any period included in a 
regularly scheduled 12-hour tour of duty.
    ``(3) A nurse who works a work schedule described in this 
subsection who is absent on approved sick leave or annual leave during 
a regularly scheduled 12-hour tour of duty shall be charged for such 
leave at a rate of ten hours of leave for every nine hours of absence.
    ``(4) A nurse working a work schedule under this subsection shall 
be eligible for holiday pay under section 7453(d) of this title for any 
service performed by the nurse on a designated holiday under such 
section, regardless of whether such holiday occurs during or outside 
the nurse's regularly scheduled tour of duty under such work schedule.
    ``(c) 9-Month Work Schedule for Certain Nurses.--(1) The Secretary 
may authorize a registered nurse appointed under section 7405 of this 
title, with the nurse's written consent, to work fulltime for nine 
months with 3 months off duty, within a fiscal year, and be paid at 75 
percent of the fulltime rate for such nurse's grade for each pay period 
of such fiscal year.
    ``(2) A nurse who works under the authority in paragraph (1) shall 
be considered a 0.75 fulltime equivalent employee in computing fulltime 
equivalent employees for the purposes of determining compliance with 
personnel ceilings.
    ``(3) Work under this subsection shall be considered parttime 
service for purposes of computing benefits under chapters 83 and 84 of 
title 5.
    ``(4) A nurse who works under the authority in paragraph (1) shall 
be considered a fulltime employee for purposes of chapter 89 of title 
5.
    ``(d) Treatment as Full-Time Employee.--(1) A nurse working a work 
schedule under subsection (b) or (c) who is a full-time employee in 
non-probationary status at the commencement of work under such work 
schedule shall remain a full-time employee in non-probationary status 
while working under such work schedule.
    ``(2)(A) A nurse under a part-time appointment under section 
7405(d) of this title who, while working a work schedule under 
subsection (b) or (c), performs hours of service (as determined in 
accordance with such subsection) equivalent to two years of service 
shall be treated as a full-time employee and no longer in probationary 
status.
    ``(B) In determining the hours of service performed by a nurse for 
purposes of subparagraph (A), any hours of service not performed under 
a work schedule under subsection (b) or (c) shall not be included.
    ``(e) Notification of Modification of Benefits.--The Secretary 
shall provide each nurse with respect to whom an alternate work 
schedule under this section may apply written notice of the effect, if 
any, the alternate work schedule will have on the nurse's health care 
premium, retirement, life insurance premium, probationary status, 
or other benefit or condition of employment. The notice shall be 
provided not later than 14 days before the nurse consents to the 
alternate work schedule.
    ``(f) Regulations.--The Secretary shall prescribe regulations to 
carry out this section.''.
    (2) The table of sections at the beginning of chapter 74 is amended 
by inserting after the item relating to section 7456 the following new 
item:

``Sec. 7456A. Nurses: alternate work schedules.''.
    (b) Policy Against Work Shifts in Excess of 12 Hours.--(1) It is 
the sense of Congress to encourage the Secretary of Veterans Affairs to 
prevent work shifts by nurses providing direct patient care in excess 
of 12 hours in any 24 hour period.
    (2) Not later than one year after the date of the enactment of this 
Act and every year thereafter for the next two years, the Secretary 
shall certify to Congress whether or not each Veterans Health 
Administration facility has in place, as of the date of such 
certification, a policy designed to prevent work shifts by nurses 
providing direct patient care in excess of 12 hours in any 24 hour 
period.
    (c) Report on Overtime for Certain Nurses.--(1) Not later than one 
year after the effective date of this Act, the Secretary of Veterans 
Affairs shall submit to Congress a report on the overtime, if any, 
worked by nurses covered by work schedules described by subsections (b) 
and (c) of section 7456A of title 38, United States Code (as added by 
subsection (a)), during the one-year period ending on the date of such 
report.
    (2) The report shall set forth--
            (A) the aggregate number of hours of overtime worked by 
        nurses under each such work schedule during the one-year period 
        ending on the date of the report; and
            (B) the aggregate amount of overtime pay paid to nurses 
        working under each such work schedule during such period.

SEC. 5. RATE OF PAY FOR DIRECTOR OF NURSING SERVICE.

    (a) Senior Executive Service ES-6 Rate.--(1) Subchapter IV of 
chapter 74 is amended by adding at the end the following new section:
``Sec. 7459. Director of Nursing Service: rate of pay
    ``(a) Senior Executive Service ES-6 Rate.--The rate of pay for the 
Director of Nursing Service shall be equal to the sum of the maximum 
rate of basic pay established for the Senior Executive Service under 
section 5382 of title 5 and the amount of the locality-based 
comparability payment provided under section 5304 of such title for the 
Director's locality.
    ``(b) Inapplicability of Nurse Pay Provision.--Section 7451 of this 
title does not apply to the Director of Nursing Service.''.
    (2) The table of sections at the beginning of chapter 74 is amended 
by inserting after the item relating to section 7458 the following new 
item:

``Sec. 7459. Director of Nursing Service: rate of pay.''.
    (b) Conforming Amendment.--Section 7404(d) is amended by striking 
``section 7457'' and inserting ``sections 7457 and 7459''.

SEC. 6. NURSE EXECUTIVE SPECIAL PAY.

    Section 7452 is amended by adding at the end the following new 
subsection:
    ``(g)(1) In order to recruit and retain highly qualified Department 
nurse executives, the Secretary may, in accordance with regulations 
prescribed by the Secretary, pay special pay to the nurse executive at 
each location as follows:
            ``(A) Each Department healthcare facility.
            ``(B) The Central Office.
    ``(2) The amount of special pay paid to a nurse executive under 
paragraph (1) shall be not less than $10,000 or more than $25,000.
    ``(3) The amount of special pay paid to a nurse executive under 
paragraph (1) shall be based on factors such as the grade of the nurse 
executive position, the scope and complexity of the nurse executive 
position, the personal qualifications of the nurse executive, the 
characteristics of the healthcare facility concerned, the nature and 
number of specialty care units at the healthcare facility concerned, 
demonstrated difficulties in recruitment and retention of nurse 
executives at the healthcare facility concerned, and such other factors 
as the Secretary considers appropriate.
    ``(4) Special pay paid to a nurse executive under paragraph (1) 
shall be in addition to any other pay (including basic pay) and 
allowances to which the nurse executive is entitled, and shall be 
considered pay for all purposes, including retirement benefits under 
chapters 83 and 84 of title 5, and other benefits, but shall not be 
considered basic pay for purposes of adverse actions under subchapter 
V.''.

SEC. 7. CLARIFICATION OF DISCRETIONARY NATURE OF VETERANS HEALTH 
              ADMINISTRATION PERSONNEL ADMINISTRATION AUTHORITIES.

    (a) In General.--Chapter 74 is amended by inserting after section 
7426 the following new section:
``Sec. 7427. Discretionary nature of functions
    ``Any authority assigned to the Secretary or another officer of the 
Department under this chapter shall be carried out at the discretion of 
the Secretary or other officer, as the case may be.''.
    (b) Clerical Amendment.--The table of sections at the beginning of 
chapter 74 is amended by inserting after the item relating to section 
7426 the following new item:

``7427. Discretionary nature of functions.''.

SEC. 8. EFFECTIVE DATE.

    The amendments to title 38, United States Code, made by this Act 
shall take effect one year after the date of the enactment of this Act.
            Amend the title so as to read: ``An Act to amend title 38, 
        United States Code, to simplify and improve pay provisions for 
        physicians and dentists and to authorize alternate work 
        schedules and executive pay for nurses, and for other 
        purposes.''.




                                                       Calendar No. 713

108th CONGRESS

  2d Session

                                S. 2484

                          [Report No. 108-357]

_______________________________________________________________________

                                 A BILL

  To amend title 38, United States Code, to simplify and improve pay 
  provisions for physicians and dentists, to authorize alternate work 
                schedules and executive pay for nurses.

_______________________________________________________________________

                           September 23, 2004

        Reported with an amendment and an amendment to the title