[House Hearing, 109 Congress]
[From the U.S. Government Publishing Office]


 
The Department of Veterans Affairs Proposed Health Care budget amendment for 
fiscal year 2006


Wednesday, July 21, 2005

U.S. House of Representatives,     
Committee on Veterans' Affairs,
Washington, D.C.

    The Committee met, pursuant to notice, at 2:08 p.m., in Room 334, Cannon 
House Office Building, Hon. Steve Buyer [Chairman of the Committee] presiding.
    Present:  Representatives Buyer, Moran, Miller, Boozman, Bradley, Brown-
Waite, Turner, Evans, Filner, Snyder, Michaud, Herseth, Strickland, Hooley, 
Berkley, and Udall.

    The Chairman. The full Committee on the House Veterans' Affairs will come to 
order.  It is July 21, 2005.
    The purpose of this hearing is to continue the oversight of the VA health 
budget process for fiscal years 2005 and 2006.
    By mutual agreement with the Ranking Member, Mr. Evans, prior to the 
hearing, Mr. Evans and I will make brief opening remarks and members will be 
recognized for their statements and questions under the five minute rule.
    We are here this morning to bring accountability to this process.  This is 
the very reason I elected to serve in this capacity as Chairman of this 
Committee, to bring accountability and credibility to this process.
    We owe our veterans a dignified, predictable, responsive process that 
provides quality care and benefits today and into the future.  Accountability 
and credibility will ensure that we have that process, one that veterans and 
taxpayers can trust.
    On June 30th, as we met here to determine what resources the administration 
needed to care for America's veterans, I said "As Chairman, getting the VA 
budget right is about the most important thing I can do.  Without a good budget, 
how can we provide good care for our nation's veterans?  So, we are going to get 
the budget right."  That is what we are going to do.
    I am deeply disappointed at the recent series of events that led up to this 
hearing today.  A few weeks ago before this Committee at a hearing regarding the 
budget modeling, we were informed about the VA's shortfall.  We subsequently 
asked the Secretary to let us know what he needed.  He promptly returned with a 
number of $975 million, which you provided, Dr. Perlin, from your staff.
    Before the day was out, the House of Representatives voted the money that 
was requested to the penny, requested to us on a written transmittal from the 
President of the United States.
    As it turns out, that number now appears to be incorrect.  Later we were 
told in fact that the true number for fiscal year 2005 may in fact require an 
additional $300 million more than what was originally stated.
    I am interested in your testimony today about circulation of that number and 
what it means.
    Later the administration delivered a $1.977 billion budget amendment for 
fiscal year 2006 to correct shortfalls in the VA's budget for next year.
    In order for Congress to exercise its constitutional role to care for 
veterans, we need to rely on you to provide us timely and accurate information.
    I hold you, the senior management of the VA's Health Administration, 
responsible for providing us that information.  To date, I have not been pleased 
with some of the responses.
    I am disappointed by more than just numbers.  We have discovered the VA's 
inability to forecast demand.  We have been briefed on the in excess of $325 
million in the account receivables yet to be collected.  The appointment 
backlogs continue to grow.
    Although, I will pause and say it is the doctors, the nurses, the hospital 
personnel of VHA who are the true heroes, to also include our volunteers.  They 
care for our wounded and sick veterans every day in our hospitals and clinics 
throughout the VA system.  I cannot help but feel as though they also are not 
being well served.
    I intend to push the bureaucracy at the VA to help change it and make it 
more responsive to the needs of our nation's veterans.  This Committee will 
ensure that veterans will receive their care.
    This Committee will hold you, Dr. Perlin, and members of your staff, 
accountable for this system.
    This Committee will take action to ensure the system works and that it 
serves our nation's veterans and their families, from our oldest survivors of 
World War I to the most recently returned soldier, sailor, airman, Marine, Coast 
Guardman returning from Iraq, Afghanistan, the war on terror, and other places 
around the world and domestically, to also include our new veterans.
    That is what we are going to talk about this afternoon.
    At this point, I will yield to Mr. Evans for his opening remarks.
    Mr. Evans. Mr. Chairman, the last time we talked here, I expressed my 
anger over the inability of this Administration to level with us and level 
with America's veterans as well.  Today, I am still angry, but frankly, I am 
mostly puzzled.
    The administration's revised request for fiscal year 2006 still fails to 
fully address the needs of the VA for the upcoming fiscal year.  At this late 
date, the administration still submits a request that relies upon policy 
proposals that have been overwhelmingly and repeatedly rejected by Congress.  
Why is this Administration still not leveling with us?
    The philosophy put forth is one to drive veterans out of the system, to 
kick needy veterans out of long term health care because they don't have 
enough beds to serve the veterans, and to gloss over the real mental health 
care needs of our veterans.
    We ask our men and women who serve to be willing to sacrifice all that 
they can give.  To honestly tell us what resources you need to care for them 
is the least you can possibly do for them.
    This is an important hearing at this time.  Mr. Chairman, I appreciate 
your setting this time this afternoon to hear these issues.  Thank you.  I 
yield back the balance of my time.
    [The statement of Lane Evans appears on p. 47]
 
    The Chairman. Thank you, Mr. Evans.
    We will hear testimony from Dr. Perlin, the Under Secretary for Health, 
Department of Veterans' Affairs.
    Your written testimony will be submitted for the record, and you are now 
recognized for five minutes.

STATEMENT OF JONATHAN B. PERLIN, M.D., UNDER SECRE-
    TARY FOR HEALTH; ACCOMPANIED BY LAURA J. MILLER,
    DEPUTY UNDER SECRETARY FOR HEALTH FOR OPERA-
    TIONS AND MANAGEMENT; AND JIMMY A. NORRIS, VET-
    ERANS' HEALTH ADMINISTRATION CHIEF FINANCIAL 
    OFFICER, DEPARTMENT OF VETERANS' AFFAIRS

STATEMENT OF JONATHAN B. PERLIN

    Dr. Perlin. Mr. Chairman, Ranking Member Evans, members of the Committee, 
thank you for your continuing support and ongoing dialogue regarding the 
interaction of budget forecasting and finances of the Veterans' Health 
Administration.
    Accompanying me today are Ms. Laura Miller, Deputy Under Secretary for 
Operations and Management and Mr. Jimmy Norris, our Chief Financial Officer in 
VHA.
    Mr. Chairman, considering our budget planning and the request for fiscal 
year 2005 supplemental appropriations, as well as continuing resource needs 
for health services for 2006, I'd like to discuss what facts underlie the need 
for a fiscal year 2005 supplemental request.
    VA requested a supplemental appropriation in the amount of $975 million 
for fiscal year 2005 in June of this year.  That supplemental request was 
needed because our expected forecasted growth, based on the actuarial model, 
was 2.3 percent, and VA discovered in March 2005 that the actual growth had 
accelerated through mid-year 2005 to 5.2 percent.
    This was a difference of 2.9 percent above the original projection.  This 
higher than anticipated demand for VHA services was a major factor driving our 
need for a supplemental appropriation.
    Mr. Chairman, as we discussed during your June 23rd hearing, VA uses an 
actuarial model to forecast patient demand and associated resource needs.  
Actuarial modeling is the most rational way to project resource needs of a 
health care system like VHA.
    As I noted at that hearing, that's the approach used by the private 
sector.  Unlike the private sector, however, with the projections used to 
formulate budgets for the next year or even the next open season, the Federal 
budget cycle requires budget formulation using data two and a half to three 
and a half years ahead of actual budget execution.
    For example, the data used to formulate the budget in fiscal year 2005 was 
derived from health care utilization data in fiscal year 2002.  In this case, 
the last full year of data before the Department's fiscal year 2005 budget 
formulation process began.
    Our actuarial model forecasted 2.3 percent annual growth in health care 
demand in fiscal year 2005.  We discovered that growth had accelerated through 
mid-year 2005 to 5.2 percent above 2004.  This constitutes a substantial 
increase in workload and resource requirements.
    As a result, our increased medical care costs in 2005 are $975 million 
based on increased patient demand and increased utilization of health care 
services.
    With respect to 2006, I believe that an additional $1.977 billion above 
the President's budget request is needed to continue to provide timely, high 
quality care to enrolled veterans.  This includes for 2006 $300 million to 
replenish carry over funds that are being used in fiscal year 2005 to cover 
the increased average cost per patient.
    It also includes $677 million to cover an estimated two percent increase 
in the number of patients expected to seek care in 2006; $400 million to 
recognize the expected cost of providing more intensive treatment, and $600 
million to correct for the estimated cost of long term care.
    The administration has come forward to Congress with a proposal to provide 
VA with these additional resources.  The total need for both years is $2.952 
billion, comprising a fiscal year 2005 supplemental request of $975 million 
and a fiscal year 2006 budget amendment of $1.977 billion.
    These amounts assume enactment of the policies in the President's budget.  
If Congress does not accept any of the policies in the President's budget, 
additional resources to offset the cost of policies not enacted will be needed 
still.
    While the 2.9 percent variance among the number of patients projected is 
far better than the variances that occurred under the previous system, when VA 
budgets were projected simply by inflating an historical base, it is clear 
that we need to improve the models and methodologies' performance, and we will 
work with you to improve not only the model and methodology, but the overall 
process.  Indeed, we must.
    Planned improvements of the model include obtaining access to data on VA 
enrollees' use of Medicaid, Tricare, and military treatment facilities, 
integrating VA's long term care model into the actuarial model, and modeling 
additional services, such as dental care.
    In addition, we need to continue the progress already made with DOD to 
better engage them in data sharing and projections regarding OIF and OEF 
returnees.
    To address the average three year time lag in the budget process, we need 
to also better consider trends in the economy and environment that might not 
yet be incorporated into past data and then into the model.
    We can incorporate those and they can be provided to adjust our budget 
formulation process.
    Since VA is a low or no cost provider, we must better anticipate the 
effects on our system as the other health care options to veterans become more 
costly.
    Perhaps more importantly, the Secretary has committed to quarterly reviews 
with this Committee to address resource needs in light of VHA's most current 
operational experience.
    Mr. Chairman, members of the Committee, in closing, I believe the 
resources requested in the supplemental appropriation for fiscal year 2005 
proposed by the administration and the President's budget amendment for fiscal 
year 2006 reflect the commitment and support by the administration to the 
veterans of this nation in meeting the increased demand for VHA health care 
services.
    Thank you for your support of veterans and VA, and for the opportunity to 
testify before you on this complex issue.
    [The statement of Jonathan B. Perlin appears on p. 48]
 
    The Chairman. Thank you for your testimony, Dr. Perlin.
    Dr. Perlin, have you briefed the Secretary of Veterans' Affairs on VHA's 
monthly performance reviews for the past 15 months as Acting Under Secretary 
for Health and now as the confirmed Under Secretary for VHA?
    Dr. Perlin. Mr. Chairman, the monthly performance review is held with the 
Deputy Under Secretary presiding, and the Deputy Secretary in turn discusses 
outcomes of the monthly performance review with the Secretary.
    The Chairman. At each of these briefings, how is then the Deputy Secretary 
briefed on the forecast budget requirements and actual budget execution?
    Dr. Perlin. Mr. Chairman, the monthly performance review has virtually for 
number of veterans using the system, the number of patients as well as the 
number of enrollees, a column that shows the actual performance, the actual 
numbers.
    There is a lag time of one to two months, depending on how quickly we have 
the monthly performance review, and that is tracked against both the previous 
year, as well as against plan.
    The Chairman. What is the role of the VA's corporate chief financial 
officer and the chief network officer in formulating and preparing the monthly 
review?
    Dr. Perlin. The VHA's chief financial officer has the role of actually 
consolidating the data used to put the book together from VHA to provide to 
the Deputy Secretary. The execution of the resources, the line direction for 
that is provided by the Deputy Under Secretary for Operations and Management, 
formerly entitled the chief network officer.
    The Chairman. When did you inform the Deputy Secretary of a divergence 
between the 2005 budget and the monthly performances?
    Dr. Perlin. That is really the key point.  As we testified, with a lag of 
about 30 to 60 days, April and May, it was apparent that not only were the 
numbers of actual veterans tracking above projection, but that this was going 
to begin to have some impact on budget and not tracking with budget.
    I believe that would be the April/May monthly performance review when that 
began to diverge.
    The Chairman. Have you been able to decipher why there was such a spike in 
May?
    Dr. Perlin. Historically, usually there is sort of a seasonable trend in 
the number of veterans that come to us, but this was an unusually high number 
that came at this point in the year.
    What was apparent during the month of May was we were beginning to diverge 
not only in terms of the numbers of veterans seeking care, but in terms of the 
consumption of resources, such as use of capital dollars, non-recurring 
maintenance, non-critical equipment, for the actual operations, paying for the 
cost of care for those patients.
    The Chairman. When you sent this letter to Congress talking about you are 
going to have to move $600 million, that was in April when you informed the 
Appropriations Committee?
    Dr. Perlin. Yes, I believe, Mr. Chairman, there was a letter from the 
Secretary informing the Appropriations Committee Chairman and Ranking Member 
of the desire to reprogram $600 million of capital, and I believe some other 
administrative dollars for reprogramming as well.
    The Chairman. What we have is this moving target. You inform Congress of 
$600 million to reprogram, and in the latter part of June, the testimony is 
the shortfall is $975 million.  Then we come back after a July break and we 
say oops, now there could be another $300 million that may be necessary.
    Is there another number that's about to hit us?  You know what I'm saying?  
This thing is tracking upward and is going to continue to track upward?  Then 
what it does is it leads us to make sense next week to say, all right, fine, 
Senate, you chose this $1.5 million number.  Is that where this thing is 
taking us?  Besides, if you don't use the extra monies, they are carried over 
into 2006, which affects your budget amendment that you bring to us.
    Help this Committee understand this.
    Dr. Perlin. Mr. Chairman, that is a very valid concern.  It's one that I 
share.  I sat with the Secretary and testified to $975 million at that 
hearing.
    Clearly, my belief is that $975 million is what we need to go forward with 
for the 2005 replenishment, but during that week, there was a good deal of 
activity and looking into what the actual consumption was by querying the 
field, and additional resource consumption came to light.
    We could have done a better job.  We should have had more timely data.  I 
would concur with what I take is if not implicit, an explicit recommendation 
to improve the accountability, improve the timeliness, improve the clarity of 
the tracking of those funds.
    I know that in that process, we put the Secretary and we put you and this 
Committee in a tough situation.
    The Chairman. Before I yield to Mr. Evans, when you make these separate 
requests like this, the Senate takes different action.  We act on your 
requests.  It becomes a credibility gap. There is an erosion here.
    Then there is this corrosive rhetoric that is used out there that has a 
depreciating effect upon the men and women in uniform and the families, and 
none of it is healthy.
    Right now, I yield to Mr. Evans.
    Mr. Evans. Mr. Chairman, at this time, I want to yield to my colleagues.  
I yield at this time to Mr. Filner.
    The Chairman. Mr. Filner, you are now recognized for five minutes.
    Mr. Filner. I thank the Chairman and I thank the Ranking Member.  Mr. 
Chairman, I appreciated the comments on accountability and some of the 
questions.  I think we are more than a few months late and more than a few 
billion dollars short, however, because many of us were raising these exact 
same issues many, many months ago, and credibility was gone then, not just 
now.
    Dr. Perlin, I have watched this Administration over the last month, the 
VA, the OMB, the White House, basically show enormous disrespect for our 
veterans.  I can see the insult to the veterans.  I see it continuing today, 
sir.
    You continue to talk about a mathematical model as if you are locked up 
in a little room with only a computer there, and you get figures from three 
years ago and you plug them in.
    Talk to people outside who are in the hospitals. Talk to the veterans. 
Talk to the VSOs who put together the Independent Budget.  Why were they right 
on the mark? When I go to my VA hospital in La Jolla, why do I see almost 
1,000 veterans on a waiting list?  I see 300 vacancies in the hospital.  I 
see nurses stations unfilled.  I see people waiting a year for a dental 
appointment.  Years for adjudication of their claims, though not in your 
bailiwick.
    All you have to do is ask any veteran and you know there is a problem.
    You keep talking about a model as if we are run by a mathematical model 
that didn't account for a war going on. Don't keep telling us that you are 
run by a model, which is what you keep doing.
    You know there is a war going on.  You know people are coming back with 
PTSD.  Talk to them.  Get the resources in there.  You know there are 
vacancies.  You are still talking about a mathematical model.
    I think that is incredibly insulting to the veterans of this nation.  
    This side of the aisle tried, in fact, to add the resources that you are 
asking for now, and we kept being shot down by the other side, because it 
didn't fit into their budget.
    Then you come to us today with another request, $1.97 billion for 2006, 
when you know we have already refused to accept your policy recommendations on 
raising prescription drug fees and enrollment fees.
    You are acting as if, "oh, we didn't know that happened."  What about the 
$1.2 billion to make up for the rejection of fees?  Why don't you ask for that 
now?  We have rejected that policy, but you are not coming back with a number 
to cover those costs.
    Mr. Perlin, I don't understand why you are still talking about a model. 
You are still talking about figures which have no relevancy to reality.  You 
have been found out, and you are still talking about it as if you have not 
been found out.
    Let me ask you specifically.  Mr. Bolten, head of the OMB, has testified 
to the Budget Committee recently.
     He said each of the last three years, the VA health care system had half 
a billion dollars more than it needed. This is what the administration 
testified to, a half billion dollars more than it needed.
    In the face of waiting lists, in the face of vacancies, in the face of 
year long waits, do you agree with Mr. Bolten that you had half a billion 
dollars more than you needed, that was appropriated in the last three years?
    Sir, are you aware of that statement?
    Dr. Perlin. I'm aware of the statement and I'm aware of the fact that 
indeed, there were carry overs.
    I would like to answer your first question though.
    Mr. Filner. That was my first question.
    Dr. Perlin. In my statement today, sir, if I may, I did note that if 
Congress does not accept any of the policies in the President's budget, 
additional resources -- 
    Mr. Filner. We already turned them down.  You are acting as if you don't 
know that, just like you didn't know the war was going on.  Get out of your 
computer room. Look at the reality.  Talk to the veterans who put together 
this Independent Budget.  Talk to us who go to our veterans' hospitals and 
talk to veterans when we are in our districts.
    We hear these stories, and you think we are just politicians who don't 
know what's going on.  We know what's going on.  You don't know what's going 
on.
    You better start learning what's going on because you keep testifying as 
if we don't know what's going on.
    The Chairman talked about a lack of credibility. You don't have any now.  
You continue to talk in the same old model.
    Do you know how many people are on waiting lists throughout the nation 
today, waiting for their first appointment, and how many vacancies there are 
in staff positions throughout the nation?  Do you have that figure?
    Dr. Perlin. Sir, there are approximately 25,000 today who are on waiting 
lists.
    Mr. Filner. 25,000?  You are still talking about a model?  Why don't you 
talk about how you are going to serve those 25,000?
    Dr. Perlin. That's why we came forward with a supplemental -- 
    Mr. Filner. How many vacancies are there, staff vacancies, around the 
country?
    Dr. Perlin. Sir, that's why we came forward with the request.
    Mr. Filner. How many staff vacancies?
    Dr. Perlin. What I can tell you is we are approximately 7,000 FTEE above 
what we had predicted, just so we could provide timely services to veterans.
    Mr. Filner. That is not the question.  I said how many vacancies to serve 
the veterans do we have now?
    I'm told in my VA hospital in San Diego there are 300 vacancies.  You 
should have a list of every hospital and what their vacancies are.  Do you 
have that?
    Dr. Perlin. I could determine what number are available throughout the 
system.  The fact of the matter is, we are approximately 7,000 personnel 
higher than were predicted.
    Mr. Filner. I'm not asking what you predicted. You just told us the model 
is ridiculous.  I want to know how many personnel we need to serve the 
veterans that we have and who are on the waiting lists.  How many short are 
we?
    Dr. Perlin. I'd have to come back.
    Mr. Filner. Come on, Dr. Perlin.  This is what your job is.  How many 
veterans we have to serve, do we have the facilities, do we have the personnel 
to serve them?  You don't even have those figures?  How are you going to come 
up with the right number if you don't even have these figures at your 
disposal?
    I can tell you in my hospital what the figures are. That tells me how much 
money I need in the San Diego Medical Center.  You should know that for every 
medical center.
    Your statement was completely irrelevant to the needs, and you don't even 
have the information to answer the basic questions.
    I would yield back.
    Dr. Perlin. We have 127 vacancies in your hospital at San Diego.
    Mr. Filner. How many in the whole country?
    Dr. Perlin. I don't know.  I do know San Diego because your office requested 
that information.
    Mr. Filner. I know that figure.  I want to know what the figure is for the 
whole country.  How are you going to serve the veterans if you don't know how 
many vacancies there are?
    The Chairman. I thank the gentleman for yielding back his time.  I 
appreciate your being responsive to Mr. Filner's question, and please get that 
in a timely manner to him.
    Mr. Filner. For the record, he is not responsive.
    The Chairman. I would appreciate it, Dr. Perlin, if you would be 
responsive to the gentleman from California's request.
    Dr. Perlin. Yes, sir.
    The Chairman. I also think it would be very helpful in being responsive to 
his question when he made reference to the model.
    You had already testified previously that the model is also used in the 
private sector, and there were concerns about the data and the assumptions.
    We are now getting into this and beginning to understand it a little bit 
better.  You are also now having to deal with trying to get it right for 2005. 
We have to get this done before we leave for the August break.  We have an 
2006 budget amendment, and you are preparing the 2007 budget as we sit here.
    I think it would be very helpful to this Committee and responsive to Mr. 
Filner's questioning, to know what changes you are making with regard to input 
of new data or changes in the assumptions.
    Obviously, you took something into account by giving us an 2006 budget 
amendment and as you are working on 2007.
    I think that would be the best thing to be responsive to Mr. Filner's 
concern.
    Dr. Perlin. Thank you, Mr. Chairman, for the opportunity to be very clear 
on how the model needs to be improved.  In fairness, this is how we identify 
what resource needs are for veterans and how we work together to identify a 
budget.
    As I stated, the formulation process to budget execution has an inherent 
lag time.  It's been arbitrary, that end of year data from the preceding year 
has been used.  For instance, the 2005 budget was predicated on end of year 
2002.
    One of the things that we are working with the actuary to do is move those 
data so they are rolling.  Perhaps the most recent 18 months, so it is a 
little bit closer to reality.
    We also know that veterans receive care in other environments, Medicaid, 
Tricare, military treatment facilities.  We also know they have dental needs 
and long term care, and all five of those categories, Medicaid, Tricare, MTF 
direct care, dental care, long term care, have previously been excluded from 
the model.  We are working with the actuary to include those.
    We are also looking to deconstruct how we failed in terms of getting it 
right this year.  We had discussion previously on better sensitivity to 
separating service members as they become veterans.
    We are working with the Department of Defense to get more timely 
information, not just about separation data in general, but about the 
activation and predicted separation rates of Reserve members who may be 
called up and then become eligible for care.
    We believe those will be a number of features that will improve this 
model.
    You may say I'm still skeptical.  How can you rely on a set of 
methodologies given the experience that we have had.  The truth of the 
matter is we used to use the historical process.  We used to just plus up 
on the historical base.
    Once we were off by ten percent in 2002. Unfortunately, we were short. 
The previous year, we were off by 11 percent.  That year, it was in VA's 
favor.  Those degrees of variance or error are substantially more.
    I would tell you that the model is not inherently bad.  The challenge is 
in the lag time and some of the additional data.
    I understand Mr. Filner's concerns that the model doesn't operate in 
isolation.  These are real people coming to real VA, and we have a real time 
obligation to get it right. That is why Secretary Nicholson was absolutely 
passionate about -- 
    Mr. Filner. What is the difference if you get it right if OMB says you 
have too much money anyway?  They are the ones making the final decisions.
    You didn't answer my question if you agreed with his assessment that you 
had half a billion dollars more than you needed.
    The Chairman. I need to ask for regular order.
    Thank you for the answer to the question.
    Mr. Miller, Subcommittee Chairman on Disability Assistance and Memorial 
Affairs, is now recognized.
    Mr. Miller. Thank you, Mr. Chairman.  I associate myself with most of the 
remarks of my colleague, Mr. Filner.
    Dr. Perlin, are you embarrassed?  Are you embarrassed by what's happening?
    Dr. Perlin. I am embarrassed with what's happening.
    Mr. Miller. Here today we celebrate the 75th anniversary of the VA, and 
all the good that the administration has done, and you have members of this 
Committee so angry about what's going on.
    This is one of those Committees where everybody tries as best they can to 
de-politicize what's going on because our ultimate goal is serving the 
veterans.
    Politics will always creep into it, but the decisions and votes that I 
make are based on the information that you testify to and you provide and the 
administration does.
    I find it hard to believe that if you do these quarterly reviews, that the 
information that you forecast through this model on is so stagnant, that it's 
causing the problem.
    I think something that a lot of us probably want to know because it has 
affected every member on this Committee and every member of this Congress is 
when did VHA stop dis-enrolling beneficiaries that hadn't been to the VA 
within a two year period? We are all hearing that from our veterans. If you 
will answer that first.
    Dr. Perlin. Yes, sir.  I will need to check because this has been a long-
standing policy that if someone doesn't come for a period of two years, we 
open up the slot for the primary care provider to new veterans.  I believe 
that has been a policy.  I will find out for you the date on which we began 
that.
    We require a primary care provider on average to have a panel of 
approximately 1,200 patients, and we want to make sure that we always open 
capacity for the newest patients, and that was the rationale behind that 
decision.
    Mr. Miller. You say it's a policy.  My next question is under what 
authority do you have to make that decision and when that decision was made, 
did you in fact inform Congress that you were going to be doing that?
    Real quick, I'll tell you how we were informed.  We got letters from 
veterans that came in and gave them to us. That is the notification that was 
made to us.
    Dr. Perlin. Sir, I should be very careful in the terms.  It's not 
enrollment.  It's empaneling with a particular care provider, primary care 
provider.  We do open the slot if the veteran does not come to that primary 
care provider after a period of two years.
    Mr. Miller. How was Congress notified that you were taking those steps?  
At what point?
    Dr. Perlin. I don't know.  I would have to find that out for you, sir.
    Mr. Miller. On page three of your testimony in the second paragraph, you 
said "These amounts assume enactment of the policies in the President's 
budget, and if Congress does not accept any of the policies in the 
President's budget, additional resources to offset the cost of those will 
still be needed."
    Explain that a little further.
    Mr. Perlin. Sir, in the budget that the VA put forward, there were four 
policies.  One, requesting an enrollment fee.  One for an increase of 
prescription co-pay. Both of those policies were Priority 7 and 8 veterans. 
As well as two long term care policies, one associated with state veterans' 
homes and one associated with VI.
    The total monetary effect of those or appropriation effect of those was 
approximately $1 billion, and absent enactment of that, in addition to the 
$1.977 billion that we have come forward with the presidential budget 
amendment request for, an additional $1 billion would be necessary.
    Mr. Miller. Surely, you are not implying that this Congress is the reason 
for the shortfall.
    Dr. Perlin. No, sir.
    Mr. Miller. Because this Committee has said no to several of those 
recommendations.  I don't even understand why the inference is even in your 
testimony, because that has already been brought forward for authorization, 
and the answer was no.
    Dr. Perlin. Yes, we understand that.
    The Chairman. Mr. Michaud, you are now recognized.
    Mr. Michaud. Thank you, Mr. Chairman.
    Dr. Perlin, I believe part of the reason why you are spending so much time 
here with us is because the VA and the administration has failed to level with 
Congress and with our veterans.  If you would tell us what you actually really 
need, then we could work in a bipartisan manner to try to address that.
    It goes back to the same questions that we keep asking over and over 
again, and we don't get answers on, what is the original dollar figure that 
you asked for.  We never seem to get the answer.
    You have been around for a while. Secretary Nicholson, when he was here, 
he said he was only there for a few months, he did not know, but what was the 
number that you have asked OMB for?
    Dr. Perlin. The challenge now is, of course, that their assumptions were 
off.  We have had very good dialogue with OMB on exactly what are our needs, 
based on our missed estimation in 2005 and 2006.
    Mr. Michaud. That's not my question.  My question is what was that number.  
I don't care whether assumptions were off or not.  It gets back to the very 
fundamental issue of whether or not you are requesting enough but OMB is not 
providing enough.
    It gets back to a question that Mr. Filner had asked dealing with Mr. 
Bolten's comments that you requested more money than what you actually need.  
Mr. Filner's question was "do you agree with Mr. Bolten's assumption?"  Have 
you asked for more money than what you need?  Yes or no?
    Dr. Perlin. In previous years, sir?
    Mr. Michaud. Do you agree with Mr. Bolten's statement that VA has asked 
for more money than they actually need?
    Dr. Perlin. I'm not sure that was his statement. I don't mean to be 
argumentative.  I think he represented the fact that we carried over money in 
those years.
    Mr. Michaud. I quote "There has been three consecutive years preceding 
this one in which there was more money requested by the administration and 
more money appropriated by Congress for the medical care portion of veterans' 
services than was actually needed in that year.  The appropriations have 
exceeded the VA's medical care needs in the preceding three years by over 
half a billion dollars in each of the preceding years."
    My question is do you agree with that, that you have asked for more money 
than you need, and then the other question is do you support the provisions 
that allow you this two year authority for a portion of your funding?
    Dr. Perlin. I would say that we requested what we felt we needed in all 
years.  In terms of your second question, the two year authority, I believe 
you are referring to the supplemental appropriation.
    Mr. Michaud. The authority as far as the two year, using that carry over 
of money.  You are allowed two years to use it.  Do you agree with that 
language, and if so, why?
    Dr. Perlin. Yes, sir.  I think it gives us increased flexibility to spend 
responsibly.  We want to make sure that given the shortfall that we are 
experiencing that we execute resources as quickly as possible, but never make 
decisions that are simply to execute funds before an arbitrary time period. 
We want to make sure they go in the best interest of veterans.
    Mr. Michaud. My next question, and I mentioned it when Secretary Nicholson 
was here, when he first testified before the Committee, and it was a question 
that I brought up because the Bangor Daily News in Maine has reported that 
VISN 1 had a budgetary shortfall for fiscal year 2005.  This was in January 
and February, when they actually mentioned there was a shortfall.  They 
clearly knew back then there was going to be a shortfall.
    My question is -- as a result of my meeting last week with the VA, I've 
learned there has been incidents where VISNs have actually been borrowing from 
one another for shortfalls, and VISN 1, which is Maine, they have been forced 
to borrow money.
    My question is how is this borrowing coordinated through the VA 
headquarters, and do you track it from year to year?
    Dr. Perlin. Congressman, it is not unprecedented to transfer funds from 
one network to another or to think allocations are absolutely perfect, I 
think, would be overly ambitious.  It's good, but it's not perfect.  We do 
periodically correct it when we need to.
    Let me ask Ms. Miller to comment on how that is managed.
    Ms. Miller. Thank you, sir.  You are accurate in that Network 1 had the 
need for some funds for some non-recurring maintenance projects that were 
urgently needed and had utilized their non-recurring maintenance money for 
operations.
    Working through central office, they did coordinate to utilize funds from 
another network until the 2006 budget, at which time they would return those 
funds.
    Mr. Michaud. The second part of that question, if I might, Mr. Chairman, 
is do you track that from year to year, and what was that total dollar amount, 
and how are you ever going to make that up if you are borrowing?  Are you 
going to make it up with the additional funding in the upcoming budget cycle?
    Ms. Miller. Sir, this is an unusual situation. I'm not aware of this 
occurring on an ongoing basis.  This is the only one that I am aware of in the 
recent past.  We will track it.  There is an expectation that those funds 
would be returned, and presumably, that would come out of the 2006 budget 
allocation.
    Mr. Michaud. You said you will track it, but have you been tracking it all 
along?
    Ms. Miller. Since there haven't been any other situations that I'm aware 
of, we have not had the need to really track.
    Mr. Michaud. What effect, if I may, Mr. Chairman -- if the money is going 
to be paid back say from VISN 1, what effect is that going to have on that 
fiscal year's budget, if they have to pay back from a previous year. It must 
have some effect on the services they are going to be able to provide 
veterans, particularly since we have seen a shortfall in the care and in 
funding.
    Ms. Miller. You're correct, Congressman, that there will be an impact on 
their 2006 budget, but the issue was felt to be a timing issue in terms of 
moving forward with some projects that the network felt could not wait until 
fiscal year 2006.
    Mr. Michaud. Thank you, Mr. Chairman.
    The Chairman. Thank you.  Mr. Bradley, you are recognized.
    Mr. Bradley. Thanking you, Mr. Chairman, Mr. Evans, for the leadership 
that you are displaying on this issue, trying to get to the bottom of the 
problem, trying to rationally solve the problem.
    We all get in a lather once in a while on this Committee, but I have to 
commend both of your gentlemen for really sticking up for the veterans and 
trying to resolve the problem.
    It would appear to me just in looking at some of the big budget holes that 
have come up, long term care is something that when you look out in the 
future, a three year model ought to do a much better job of estimating the 
cost of long term care, but that is something that a model, I would think, 
can adjust for.
    What the model evidently can adjust for, which makes sense, is the fact 
that we have had several hundred thousand people on the ground in that three 
year period.  It would seem to me that is why, if we are going to solve this 
problem, you need to look a little bit outside the box of your model.
    Mr. Filner brought this up.  That being the Independent Budget.  When 
Secretary Nicholson was here, I asked him whether the VA was starting to 
discuss the parameters of the Independent Budget with the authors of that 
budget to try and resolve this, to bring a little bit more transparency in, 
unfortunately, a little bit more credibility to this issue.
    This isn't a question.  It's more of a statement.  I would just urge you 
to think outside the box, especially where there is an issue of now just 
moving targets of 975 and 1.5, and now the 2006 budget.
    We are just left scratching our heads.  The authors of the Independent 
Budget have seemingly done a much better job of anticipating what these costs 
are.  It would seem appropriate, especially given the moving target nature of 
this, that if our goal here is to solve the problem, and I think it is, and 
that's why I commended the Chairman and the Ranking Member, and certainly the 
members on the other side of the aisle want to solve the problem, we want to 
solve the problem.
    There are some experts out there that I think you ought to be talking to, 
and really talking to at great length and in great detail.
    Thank you, Mr. Chairman.
    The Chairman. Thank you. Ms. Hooley, may I make this statement?  Dr. 
Perlin, Congress also has to deal with the military health delivery system 
and that model has been very challenging.  They have testified here also with 
you.
    Congress made a decision as we moved into the war that we would fund over 
and above from the supplemental.  We have not done that as a policy decision 
with regard to the VA.
    This is in fact your job, to receive.  It is rather mind boggling, I 
think, to all of us here, that surge in capacity, and how DOD transfers these 
patients to you, whether it's a soldier, sailor, Marine, airman or Coast 
Guardman coming off active duty to new veteran status, or in particular, the 
ones right down there in Bethesda that go to your VA for rehab and then you 
seek reimbursement.
    How all that wasn't taken into account in a model is mind boggling to us.  
We are appreciative that you are going to be very responsive to this in your 
new models.
    Thank you, Mr. Bradley, for bringing it up.
    Ms. Hooley, you are now recognized.
    Ms. Hooley. Thank you, Mr. Chair, and thank you so much, and Ranking 
Member, for having this hearing, and to Mr. Bradley, we do get in a lather 
but it's because every single person in this room cares about what happens to 
our veterans.
    When I'm out speaking to groups and I'm talking about veterans' health 
care, let me tell you some of the things I say.  I'm not an expert in this 
area, but here's what I talk about when we talk about costs.
    I say we just haven't kept up with costs, and the reason we haven't kept 
up with costs is first of all, health care costs are going up faster than the 
cost of living.  Also, because of the war, there are more people coming into 
the system.  And as our veterans' population ages more, it becomes more 
expensive.  There is more long term health care.
    We have not lost as many lives in the war, but there have been a lot of 
wounded.  Some of those are going to be extraordinarily expensive, and they 
are going to be severely damaged, and that is going to cost us more money. 
The cost of modern prosthesis has gone up.
    Those are all factors that we haven't taken into account when we look at 
the VA budget.  We need to increase funding to give adequate care to our 
veterans.
    My question is of just those things that a lay person talks about, those 
are the things that all of us know happen.  How much of those are in your 
model?  How much credence do you give all of that?
    Dr. Perlin. Thank you for that very insightful question.  The previous 
question from Mr. Bradley and Chairman Buyer's comments that there are 
returning troops and a large number have come to VA, fortunately, most have 
not had significant physical injury.  Some have had particularly egregious 
trauma.
    Ms. Hooley. Right.
    Dr. Perlin. Given what we know now, and I think it's fair criticism to say 
we should not look at life through a model but through the lens of the 
patients that we are taking care of.
    We figure that in, and the numbers that I bring to you today, what this 
Administration put forward in terms of the supplemental and the President's 
budget amendment, we looked specifically at the new prosthesis to make sure 
that any returning service member who needs state-of-the-art new equipment 
gets the state-of-the-art new equipment.
    Those things have not historically been figured into the model.  In fact, 
they have been called non-model items.  I can assure you that they will be 
scrutinized, and at the risk of being repetitive, I think that's why Secretary 
Nicholson is so passionate about meeting with this Committee quarterly to be 
able to discuss with the Chairman and Ranking Member the realities of what is 
going on in real time.
    Ms. Hooley. Do we take into account the fact that health care costs are 
going up faster than cost of living?
    Dr. Perlin. Absolutely.  The actuarial model figures in any trends in 
health care inflation, figures in new technologies.  It doesn't necessarily 
figure in those things that are unique to the service we provide, like 
prosthetics.
    Ms. Hooley. The fact that we have an aging veterans' population as well, 
which is going to cost us more in long term health care and just health care 
in general?
    Dr. Perlin. Yes, ma'am.  The model looks at 55 different services being 
delivered, and to call it a ``model'' implies it's a black box of some kind, 
it's a computer, you push a button.  It's not.
    It's a set of very rigorous methodologies.  It looks at age of the patient 
and geography, technologies.
    Ms. Hooley. I have a little bit of a problem with the model, only because 
it didn't even recognize we were in a war.
    I just have to get this out because I'm very slow to get angry.  There is 
not much that really really makes me angry.  I am probably as angry as I ever 
get.  That is the waiting lists.  We are not talking about seven and eight 
priority veterans.  I'm talking about waiting lists that are a year and a 
half/two years to get hip replacements or knee replacements or hip surgery.
    I happen to have had knee surgery.  Anybody that I know that has had that 
kind of surgery, they wait until the last minute, until they really can't 
stand it any longer, and then they go in and have surgery.
    I can't imagine what it would be like if I needed hip replacement or knee 
surgery and when I got to the point of needing that surgery, I then had to 
wait another year or year and a half or two years, and the pain that one 
person would go through.
    I think that is so egregious and outrageous.  We shouldn't do that to 
people, I don't care who they are, but certainly not to our veterans.
    My question is when are we going to shorten those lists for those people 
waiting for that kind of surgery?
    Dr. Perlin. Right now, with enactment of that supplemental and the 
additional request for 2006.  In each of the two years, a portion of those 
dollars are directed at reducing -- eliminating those waiting lists.
    Ms. Hooley. Are they going to reduce the waiting lists or are they going 
to eliminate the waiting lists?  What do I tell my veterans that are waiting 
for those kinds of operations that are at the point that they can't stand the 
pain any longer, and it's not because of the doctors and the nurses and the VA 
hospitals.  They do a wonderful job.  They can only do with what they have.
    Dr. Perlin. They will receive that care with better timeliness than in any 
other health sector.
    Ms. Hooley. No waiting lists, six months, three months, what are we 
talking about?
    Dr. Perlin. Let me be clearer.  Our goal, despite more veterans, and I 
would agree with you, there should be no veteran who has to wait, but despite 
these cases, the actual number of veterans seen within 30 days of the desired 
appointment date, both primary and specialty care, is beyond 94 percent for 
specialty care and 95 percent for primary care.
    That's the goal, to have all veterans seen within 30 days, and no veterans 
waiting over 90 days.
    I've just been benchmarking that with other countries and other health 
plans.  If we could get to all those veterans being seen in those time 
parameters, VA would be the number one in the world.
    Ms. Hooley. That's where I want it to be.  Thank you.
    Dr. Perlin. Thank you for your support.
    The Chairman. Dr. Boozman?
    Dr. Boozman. Thank you, Mr. Chairman.
    I've been a pretty active member of the Committee since I've been here for 
the last four years and sat through many budget hearings, both here and 
privately and this and that.
    Again, I've really been supportive in giving the system what was asked 
for.
    My hospital has been affected in the same way as many have, with the 
longer -- quality of service is excellent if you are fortunate enough to get 
in in a reasonable length of time.
    Also, the lower priority folks, you know, who haven't been there in a 
while, get the "we will be glad to see you in 18 months" rhetoric.
    I guess my question regards a couple of things.  First of all, I know 
there are other hospitals that aren't in that situation.  We are the fifth 
fastest growing regions in the country right now, and yet with the growth, 
they have actually had physicians pulled to meet our growth, which doesn't 
make a lot of sense.
    How do you determine that?  Is that a political decision, where the 
dollars are going?  What is the rationale behind what hospitals that are 
getting the dollars and those that aren't getting funded to meet growth in 
demand?
    The second part of my question, is that you have come to us again.  You 
said I need this amount of money.  I'm very supportive of that.
    Mr. Filner and I had the opportunity to visit when we were congratulating 
the VA on its 75th anniversary.  On the Floor, I said I'll support whatever it 
takes to get this thing right.
    I guess my second part reflects Ms. Hooley's concerns. If we approve this 
amount of money for 2006 and we have the 2005 funding issues, when am I going 
to see the quality of the service that we have had for many years in the 
Fayetteville VA?
    When are we going to see that or are we going to see it go back to what I 
consider normal, that we have worked so hard for many years to get to that 
level.  Now, all of a sudden, we are much below the standard that I see when I 
pour through the budget thing that you put out as far as your waiting times 
and quality.
    Dr. Perlin. Congressman, let me begin by thanking you for your support 
of VA and veterans.  Thank you also for your acknowledge of the quality of 
care.
    I think one of the pieces in context that I would be remiss if I didn't 
provide is as evidenced this past week in U.S. News and World Report which 
referred to VA care as the top notch health care delivery system.
    There are waiting lists.  In Fayetteville, you have indicated it is the 
fifth fastest growing area of the country. Indeed, the numbers that I have, 
over the past five years, the growth has been as high as 28.76 percent growth 
in Fayetteville alone, which is significantly higher than the numbers we have 
been citing about the annualized growth of the entire system.
    You asked is there a fair distribution mechanism to make sure resources 
get to hospitals and the dollars should follow the patients.  They haven't 
been following fast enough. My goal with the resources that you are generously 
supporting is to make sure that the waiting lists are worked down so that all 
veterans get care and VA performance, as I mentioned.
    Thirty days for primary care and 30 days for specialty care for 95 and 94 
percent of all veterans, respectively, and no veterans waiting over 90 days, 
and under no circumstances a veteran with an emergency or need of urgent 
services ever waiting.
    That is our goal, and that's what I intend to do with the resources.
    Dr. Boozman. Again, with a growth of 28.6 at Fayetteville, which is 
significantly higher than other VA hospitals, why would you actually reduce 
physicians at the Fayetteville VA versus some place else?  How are those 
decisions made?
    Dr. Perlin. I think any decision to change personnel is made as a balance. 
I don't know the particular situations or what type of physicians.  Sometimes, 
you know, you hire a doctor in lieu of someone who is doing maintenance. 
Sometimes you consolidate, instead of a doctor, you might hire two nurse 
practitioners or physician assistants.
    I don't know the particular instances at Fayetteville, but I'd be pleased 
to look into it.
    Dr. Boozman. With the money that you are asking me to approve now, to 
support you with, will we go back to the level of service shortly that we 
experienced, or do you need to ask us for some more money?  That's my 
question.
    Is this enough.  Do you need more.  That's what I want.
    Dr. Perlin. Thank you for your support.  Given this process, I think you 
all would fully understand that I have no desire to be back here in this chair 
asking for more.

    [Laughter.]

    Dr. Perlin. I have scrutinized to the best of my ability the data that 
have come forward looking at the needs for prosthetics, the needs of returning 
service members, and the needs of the veterans who don't fall into one of 
those unique categories, but go to every VI and clinic throughout the country, 
that do we have the right resources.
    We have debated and discussed, and I am confident with funds in lieu of 
policy and with the supplemental, and with the President's budget amendment, 
that gets us to being able to provide not just the highest quality of care, 
but timely and good service as you have requested and veterans deserve.
    Dr. Boozman. Thank you.
    The Chairman. If I may, Mr. Strickland, what I have done is I have asked 
staff to pull recently received from the VA, the estimated waiting list as of 
July 15, 2005 for new enrollees and established patients.  They are over 30 
days.
    Mr. Strickland, if I may, as a follow up here off Ms. Hooley and Dr. 
Boozman, as I look at this, and I just shared this with Mr. Filner, in 
Charleston, you have estimated 1,638 patients.  In Cleveland, 56.  In 
Indianapolis, 287. Minneapolis, 807.  Palo Alto, 3,789.  Richmond, 1,093.  San 
Diego, 621, of which 527 is dental.  In Tampa, 2,650.
    I'm sure we could take this out and put them across your entire spectrum, 
and I think the question that has been asked by two members of this Committee 
is, you have asked for additional funds, Congress is prepared to give you 
those funds, of which you are then contracting out to take these lists down, 
and the question that I think the members are trying to get to is, are these 
the resources that you believe are necessary to take this waiting list down?
    Dr. Perlin. As I say, I come forward with as much confidence as I can 
possibly have that these are the resources to take down not only the waiting 
lists, but also veterans who are waiting beyond our service time frame of 30 
days, the list you have just provided.
    The Chairman. All right.  There will be follow up. You know you are going 
to be back here in the Spring.
    Mr. Strickland, you are now recognized.
    Mr. Strickland. Thank you, Mr. Chairman.  Dr. Perlin, and Laura Miller -- 
someone I've known for a long time, used to be in my great state of Ohio -- 
and Mr. Norris.
    I feel for you.  I really do.  I think you have a very heavy 
responsibility.  I think you are probably trying to do your best under 
really difficult circumstances.
    But I'm looking at your testimony, and I want to go back to this 
statement, after you laid out the financial needs, the budget numbers, you 
say "These amounts assume enactment of the policies in the President's budget. 
If Congress does not accept any of these policies in the President's budget, 
additional resources to offset the cost of those will still be needed."
    That statement causes me to think that you are not dealing with us in good 
faith.  How many times does this Congress on a bipartisan basis have to say no 
to those requests before you assume it is a settled matter, and that it is 
insulting to us that you would bring us numbers based upon the possibility of 
that happening.  It's not going to happen.
    The Republicans aren't going to let it happen.  We Democrats aren't going 
to let it happen.  Forget it.  Bring us budget numbers that don't make those 
assumptions.
    Don't you think that's a fair thing for us to ask?
    Dr. Perlin. It is absolutely fair given the clear voice of the entirety of 
this Committee.  The 1.977 does not include the President's policies that were 
in the budget. That is, as I mentioned earlier, an additional $1 billion.
    I apologize for the semantics of that statement, even the tone of the 
expression, but you have asked for clarity on what the numbers are.  1.977 is 
additional.
    From the congressional budgeting perspective, $1 billion is in lieu of 
those proposed policies, for a total of $2.977 billion.
    Mr. Strickland. You are asking for a sufficient amount of money without 
assuming there may be these other sources of revenue such as an user fee and 
the like?  Is that what you are telling me?
    Dr. Perlin. If the policy proposals are not enacted, we need $1 billion 
additional.
    Mr. Strickland. They are not going to be enacted. Why would that continue 
to be a part of the budget request?
    Dr. Perlin. I think we are agreeing with the numbers.  In lieu of them 
being enacted, the dollar figure is $1 billion, recognizing the sentiment of 
this, the Senate, and both Appropriations Committees.  The amount of $1 
billion plus $1.977 billion for a total of $2.977 billion.
    Mr. Strickland. Is that what you are asking for?
    Dr. Perlin. That is the figure that I believe will be necessary, sir.
    Mr. Strickland. But is that what you are asking for?
    Dr. Perlin. Yes, that is what I am here identifying the need for.
    Mr. Strickland. So, we can assume that the next time we get a budget 
request, those requests for user fees and increased costs for medicines will 
not be in it?
    Dr. Perlin. I know that the sentiment of this Committee has for a number 
of years -- 
    Mr. Strickland. It's the sentiment of the Congress, this Committee, 
certainly, but the Congress.
    Dr. Perlin, you are probably not responsible for this, but how can we 
believe that you are bringing us numbers and you are doing that in good faith 
when you are doing this?
    That puzzles me.
    Dr. Perlin. I'm giving you an exact dollar figure in lieu of what the 
budgetary effect of those policies would be.  I think I'm providing that very 
candidly, what the dollar value is.
    Mr. Strickland. Do you support those proposals? In your position, do you 
support those proposals to have an user fee and increase co-payments for 
medicines?
    Dr. Perlin. This was part of the President's budget that the VA brought 
forward.  We testified to that effect.
    Mr. Strickland. That's why I say I have sympathy for you, because I think 
you find yourselves in a position where you are having to take orders from 
someone.  Maybe it's OMB.  Maybe it's the President himself. I doubt it.
    I doubt that a decision of this specificity would go all the way up to the 
President of the United States, but someone is doing the President a 
disservice if we continue to get a budget from the President that has these 
requests that the Congress has thoroughly and totally rejected.
    It just makes me wonder if we can believe or trust or accept in good faith 
anything that we get from the administration or from this department.  I feel 
kind of sad about it, quite frankly.
    Mr. Chairman, I yield back the balance of my time.
    The Chairman. Thank you.  Ms. Brown-Waite, you are now recognized.
    Ms. Brown-Waite. Thank you very much, Mr. Chairman.
    First of all, I'd like to request that an opening statement that I have be 
admitted into the record.
    The Chairman. It shall be entered, hearing no objection.
    [The statement of Ginny Brown-Waite appears on p. 52]
 
    Ms. Brown-Waite. Thank you.  When I saw Secretary Nicholson wasn't here, I 
figured he was begging for his old job back at the Vatican.  It probably was a 
lot easier than being the VA Secretary.
    I have a few questions about veterans' health care in general.  I 
certainly agree that veterans' health care is top notch.
    Do you all do any comparisons, for example, of number of surgeries that 
your doctors perform versus out there in the other realm of medical care, 
i.e., the for profit or not for profit entities?
    The reason why I ask this is, and Ms. Hooley, you might want to hear this.
I had a veteran who had a very aggressive jaw cancer.  He was put on a very 
long waiting list for surgery.  When I inquired, I was told that the 
oncologist does one surgery a week.  One surgery a week.  I said I want that 
in writing, because if he does one surgery a week, I know about eight 
oncologists who want his job.
    Could you all provide a comparison of caseload with the private sector?  
It's amazing because when I did that, he suddenly got the surgeries scheduled 
for three weeks later.
    The other question that I have is does the VA treat non-veterans, not 
spouses, but non-veterans?  I will wait for your answer.
    Dr. Perlin. Your question on veterans is very complex.  There are a couple 
of categories of people who fall into not necessarily veterans.  CHAMPVA is a 
program that is for beneficiaries of 100 percent service connected veterans, 
alive or deceased.  That would include many non-veteran spouses and children 
in that program.
    VA will also provide humanitarian care.  VA also provides care -- 
    Ms. Brown-Waite. Would you define ``humanitarian care?''  This may be 
where we are going.
    Dr. Perlin. Sure.  Let me give you a personal example.  I may be one of 
the few VA physicians to have delivered two babies, non-veterans.  The women 
were there and I was in the emergency room.  They were ready to deliver. That 
was essentially a circumstance that was unavoidable.  The care was provided.
    An individual who has a medical emergency in the parking lot or hallway, 
we would provide care for.
    Ms. Brown-Waite. I appreciate that.  I'm sure the women who were about to 
deliver appreciated that.
    Where I'm going with this is I have several VA facilities in my area.  I'm 
not going to name the particular VA facility.  I was there on a tour, saw a 
wonderful demonstration of a piece of equipment, kind of a contraption that 
you get hooked up onto for walking purposes, for anybody who had spinal cord 
injury.  There was a very young girl there using this machine.
    I asked if she was a veteran.  I guess when you get to be my age, 
everybody looks young.  They said no, she wasn't a veteran.  She was in a car 
accident.
    My question is are we using VA resources that should be used for veterans 
for the civilian population?  I'm not making a judgment as to whether it's 
good, bad, or indifferent.  I think we need to know where these VA dollars are 
going.
    Everyone of us goes home and hears stories about veterans not being cared 
for.
    Dr. Perlin. Our first priority -- our system is there for veterans.  I 
believe I could surmise what facility you are talking about, and I believe 
another program, which happens to be a research program, a research program to 
improve the research, and when grants are obtained, NIH, for example, or from 
industry, they can be open to non-veterans as well, as part of a research 
program.
    I would imagine, because that is not a standard therapy, it's very 
state-of-the-art, evaluative research, that was the circumstances under which 
you saw that individual.  I actually believe it was at the same place I saw 
two veterans who essentially regained their walking because of that research.  
It's truly incredible.
    Ms. Brown-Waite. It is an incredible program.  My question is are veterans 
getting first dibs at it.  Lord only knows, we have enough veterans with 
spinal cord injuries as a result of this war.  I want to make sure that we are 
using these dollars for people who have served our country.
    That is what your organization is all about.  That is what we believe we 
are funding.
    Dr. Perlin. I would fully agree with you.  The circumstances, as I say, 
was likely one of a research grant, but the priority has to be always to 
veterans.
    Ms. Brown-Waite. Thank you.  Mr. Chairman, I would just like to make a 
request.  You had said you expected to see him back here in the Spring.  It 
looks as if we are not going to be out of here October 1st, so we might want 
to get an update on exactly where the money is going and what they are doing 
and how the service levels are changing before the Spring, so whatever time 
you deem appropriate.
    I think we really need to follow up and make sure that the veterans are 
being served and that they are being served in a timely manner with the 
additional appropriations that we are providing.
    The Chairman. Before I respond to this, we will continue our oversight 
here.  Some things are going to be very telling for us as we work through 
2005, as we are into the October time frame, we are going to know a lot of 
things.
    We are going to know about this 2006 budget amendment, is that even going 
to be enough.  Dr. Perlin and his staff will be putting together an FY 2007 
budget request.  We are going to be working with VHA on a bipartisan basis to 
ensure that with regard to the data and the assumptions, that they are done 
in a manner for which we also agree.  I think that just needs to be done.
    We can work cooperatively with you and we can have these updated 
briefings, and we can bring you back here and brief the members with regard 
to the data lists and what the changes are going to be.  Put us in a comfort 
zone.
    Where you are right now with the Committee is called earning back the 
trust.  I think that is probably pretty accurate.
    Ms. Berkley, you are now recognized.  Did that satisfy the gentlelady's  
request?
    Ms. Brown-Waite. Yes.
    Ms. Berkley. Thank you, Mr. Chairman.  First, welcome again.  I don't envy 
your position and I don't hold you responsible for this.  I don't think it is 
your credibility at stake here.
    I'd like to follow up on Mr. Strickland's line of questioning because I 
think we need to get this on the record. I don't mean to put you on the hot seat 
but we are going to be revisiting this again.  I just don't relish that idea.
    On July 14th, Joshua Bolten, who is the director of OMB, sent a letter 
requesting additional monies for the VA to the President.  In that letter, he 
explained about the 2005 supplemental and then he talked about the 2006 budget 
amendment.
    When you add up the numbers of the $300 million expected to carry over and 
the $677 million increase, which I think is low balling it, but we will go 
with that number, for $100 million for the increase in the cost per patient, 
and another $600 million to correct for the estimated cost of long term care, 
which I think is probably ball park, we get to the 1.977, which is what Mr. 
Bolten recommends to the President to bring forward to the United States 
Congress.
    Your testimony today talks about the total needed for both years, 
comprising the 2005 supplemental request of 975 and the 2006 budget amendment 
of 1.977.  Then you go onto say, as Mr. Strickland pointed out, these amounts 
assume enactment of the policies in the President's budget.
    Now, I think we are all pretty uniform in our belief and our knowledge 
that this has already been voted down.  It's not going to be brought forward. 
If it's brought forward, it's going to be voted down.
    According to your oral testimony, we are going to need an additional 
billion in addition to the 1.977.  Mr. Bolten, the director of OMB, who should 
know better, has proposed to the President that he bring forward a number that 
is $1 billion short of what reality tells us we are going to need to satisfy 
the cost of providing service to our veterans; is that correct?  Yes or no?
    Dr. Perlin. No.
    Ms. Berkley. Not correct?
    Dr. Perlin. No.  I think everyone in this room understands the likelihood 
of those provisions being enacted. I think the director also appreciates that 
Congress, both Houses, have really not only understood they are not going to 
be enacted, but understood the need to replace the funds in lieu of those.  He 
fully anticipates that as the one piece, and the 1.977 is the second piece.
    Ms. Berkley. In the letter that accompanied, I'm assuming, the 
documentation to the White House, the OMB recommended to the White House that 
they forward to the United States Congress, "I carefully reviewed this 
proposal and am satisfied that this is necessary at this time.  I, therefore, 
join the Secretary of the VA in recommending that you transmit this amendment 
to Congress."
    The reality is it is going to cost an extra billion dollars to care for 
our vets.
    Dr. Perlin. I believe that is assumed.
    Ms. Berkley. But not in this letter to the President.
    The actual number is $2.977 billion?
    Dr. Perlin. Yes, ma'am; it is.
    Mr. Strickland. Will my colleague yield just a second?
    This just gets to the idea of good faith and credibility.  Why wasn't that 
billion a part of the request?
    I yield back to my friend.  It's frustrating.
    The Chairman. Ms. Berkley?
    Ms. Berkley. I'm anxious to hear Mr. Perlin's response, although I would 
say that this gentleman doesn't do policy, he does numbers.  The policy of the 
VA or the OMB is to continue this myth that they are going to be able to 
generate revenue on the backs of the veterans, which Congress has already made 
very clear isn't going to happen.
    I don't think this gentleman is in a position to answer that question 
because he crunches the numbers.  He doesn't do the policy.  I don't want to 
put words in your mouth.
    I do have another question.  Could you answer Mr. Strickland very quickly?
    Dr. Perlin. I'm sorry.  I can't speak for OMB. Your very first words were 
you don't envy my position.  I would like this body to know that there is not 
a day that I don't realize what an incredible privilege it is. and I do hope 
that I represent that in terms of helping our veterans.
    Ms. Berkley. You do.  It's pretty apparent you are not in this for the 
money.  None of us are.  I know you truly serve your country, and I appreciate 
that.
    This is what is concerning me.  I got word while I'm here in Washington 
that OMB is all over my VA facilities such as they are, limited as they are, 
in Las Vegas right now, asking the same questions they asked five years ago, 
four years ago, three years ago, two years ago, and last year, and before the 
CARES study was initiated, before it was completed, before it was brought to 
bed or sent to bed, and before we had a VA appropriation that came out of this 
Congress, that provided for the funding for a medical center that we are in 
desperate need of.
    It worries me that with this shortfall, they are going to take money out 
of the capital budget, and to me, if we start robbing Peter to pay Paul, the 
people that I represent, my veterans, are going to be in a world of hurt.
    I left this Committee, you may have noticed, for a few minutes.  I had 200 
Boy Scouts waiting to have a picture taken with me.  I was out for 15 minutes. 
Believe me, this is not enough water to rehydrate.  It is hot out there.
    While I am walking back here, I am thinking of my 80 year old veterans 
that are standing -- we are having a heat wave in Vegas right now.  This is 
the 21st day of over 118 degrees.  I have 80 year old veterans that are 
standing in the heat waiting for a shuttle to take them from location to 
location to location to get their health care needs met.
    My biggest concern, Dr. Perlin, is that we are going to start taking money 
out of the capital budget to cover the costs of the health care.  Can you give 
me assurances that is not going to happen?
    Dr. Perlin. I believe strongly in the need of the hospital in Las Vegas.  
It is a very poor way of doing business right now, shuttling between the 
multiple clinic sites.  I could not be more passionate about support for that 
hospital.
    I would be remiss to speculate what I know or don't know, but the budget 
I've brought forward assumes resources for operations and preservation of 
capital, to the best of my knowledge.
    Ms. Berkley. Thank you.  Thank you, Mr. Chairman.
    The Chairman. Thank you.  I now yield to Mr. Evans.
    Mr. Evans. Thank you, Mr. Chairman.
    Dr. Perlin, would you please break out the $1.97 billion request for us?
    The Chairman. Break out the $1.97 billion budget request for 2006 is Mr. 
Evans' question, a detailed break out, if you have it, please.
    Dr. Perlin. Thank you, Ranking Member Evans.  Let me break that out, and I 
will start at the highest level and then break it down to smaller groups.
    Let me start with $677 million.  Of the $1.977 billion, $677 million is in 
anticipation of increased workload.  It's clear that the model did not predict 
the level of utilization of VA and more veterans came in.  That is a piece of 
the workload.
    In actually proportionately smaller dollar figures, there are a group of 
returning service members, and again, it's been well discussed today that we 
needed to do better in terms of anticipating the returning service members 
from OEF and OIF, in that $677 million are resources as well to care for 
returning veterans of OEF and OIF.
    Included in that $677 million, as has also been pointed out today with 
respect to the waiting lists, we need to make sure that we work down those 
waiting lists, that we contract or hire or do what is necessary to get back on 
being within all the types of targets for timely care that veterans deserve 
and you have the right to expect.
    That's the first part, the $677 million.
    The second group of funds relate to long term care. Let me tell you that 
it falls into two pieces.  Part of it was that the 2006 budget was constructed 
with an error built into it.
    At some point, it anticipated that the census would be lower in 2005 going 
into 2006, and that required additional resources.  As well, there was a 
technical error in the total to provide the long term care services necessary, 
$600 million.
    In addition, one of the things that has been apparent, both in the recent 
look at our budget and looking forward, is that the veterans coming to VA, in 
addition to there being more veterans, they are using more services.  They are 
using more services perhaps because they are not getting those services in 
other environments.  Perhaps they are using newer and more expensive 
pharmaceuticals.
    The measures, such as relative value units, things that measure procedures 
and time spent with patients, per patient, is actually higher.
    $400 million of the $1.977 billion is for that increased utilization of 
services per veteran in 2006.  That gets us up to $1.677 billion.  The $300 
million is actually attributable to similar increases in utilization, but to 
replenish the carry over and make whole the 2006 budget, getting us to the 
total of $1.977 billion.
    The Chairman. Mr. Evans yields back.  Let's do the math here real quick.  
Based on Mr. Evans' question here, $1.677 plus the $300 million, if we approve 
975 and then you say you need another 300, if the House, over the next few 
days, say we were to take the Senate's number of 1.5, you now have $200 
million over and above a present mark for 2005.  We replenish now.  We have 
an 2006 budget amendment.
    When we hear Senator Hutchinson in the Senate say if the House will take 
our 1.5, then the 2006 budget amendment comes down 300.  That is where she 
gets that from; right?
    Dr. Perlin. Yes, sir.
    The Chairman. I got it.  Thank you.  Ms. Herseth, you are now recognized.
    Ms. Herseth. Thank you, Mr. Chairman.  Before I pose a couple of questions 
about long term care as I did in our last hearing, as you break that down for 
the $1.977 billion Administration budget request, as my colleagues have spun 
out here, the additional $1 billion, if the legislative changes aren't made 
on user fees and co-pays, which everyone, I think, has acknowledged isn't 
going to happen for fiscal year 2006 and likely beyond, separate from the 
concerns that have been raised procedurally about how this request came 
forward and how you are calculating it, where does the $1 billion go?
    Where does the additional $1 billion that you have indicated will be 
needed if those legislative changes aren't made, where is the bulk of that 
billion dollars going?
    Dr. Perlin. Thank you, Congresswoman, for that question.  I can't 
attribute that to a particular activity. It would restore the budget value 
of the cost reductions that those policies would have had.  It would go to 
the general care of veterans, as would be represented in the formulation of 
the overall 2006 budget.
    Ms. Herseth. Is it my understanding that by law, the VA is required to 
provide long term care for service connected disabled veterans who are 70 
percent or greater service connected disabled, as space allows?
    Dr. Perlin. I believe that's correct.
    Ms. Herseth. My understanding is space is available, but staff is not.  Is 
that true?
    Dr. Perlin. I would have to look at particular sites.  For 70 percent or 
greater service connected veterans, if we don't have staff, those veterans, I 
believe, are eligible for contracted community nursing home care as well.
    We owe those veterans the care, whether or not we have staff, and if there 
is an issue, I would be pleased to look into it.
    Ms. Herseth. Given some of what has already been stated in terms of the VA 
medical centers and what I would hope would be the quality of care in terms of 
the long term care provided, the preference here would be to have adequate 
resources for adequate staff, so we didn't have to contract out to perhaps 
community long term care facilities that may or may not be at the same quality 
standards.
    Dr. Perlin. Let me thank you and agree with you. I know our quality is 
exceptional in the nursing homes that we have.  As a clinician who has 
practiced in two VA's, Washington and Richmond, frequently a decision is 
often made by somebody in the family, if that's a consideration.  As proud 
as I am of that, I know many veterans' families choose to have the veteran 
close by.
    Ms. Herseth. When we talked about how we broke down the $975 million 
request for fiscal year 2005 a few weeks ago, I asked a little bit about the 
long term care.  That was the second largest line item, I think, in how it 
was broken down.
    At the time, you informed me there was a partnership or research 
undertaken with the Department of Veterans' Affairs and Duke University, I 
believe, because there may have been either a technical error in the model 
or perhaps not an useful model to project long term care needs.
    Has there been any new information you can provide us?  If we are going to 
be signing off on the assumptions in a model, it would be nice to know the 
progress of that research so we are ready for the long term are where we have 
seen an increase in health care costs as well.
    Dr. Perlin. Thank you, Congresswoman, for that question.  You are 
absolutely right.  Previously, VA did not use an actuarial model to project 
care.  That was part of the problem.  We now contract with Duke University, 
and that has been running in parallel with the Millman.
    We wanted to make sure that we integrate that in all of our projections, 
but it is a new tool to use.  I believe it will be more accurate.
    Ms. Herseth. It's a new tool that wasn't used in the fiscal year 2005 
projections or for fiscal year 2006, but will be for fiscal year 2007?
    Dr. Perlin. I will have to check and find out to what degree it may 
apply to 2006.  I think there has been some experimental work to validate on 
a small scale, a particular state or network, but not the entire formulation 
of the budget to this point.
    Ms. Herseth. You do anticipate that you will be ready to do that as you 
generate a proposal in terms of VA needs for fiscal year 2007?
    Dr. Perlin. I believe so.  I think I should get you the full details for 
the record so that I don't misstate. My understanding is it is now ready to 
be used at scale.
    Ms. Herseth. I would appreciate that and think other members of the 
Committee would as well, in light of the Chairman's objective for where we may 
be as we get more information in the Fall.  That is an integral part of the 
additional information that we should have.
    Thank you.  Thank you, Mr. Chairman.  I yield back.
    The Chairman. Thank you for your contribution. Dr. Snyder?  You are now 
recognized.
    Dr. Snyder. Thank you, Mr. Chairman.
    Dr. Perlin, what is your medical specialty?
    Dr. Perlin. Internal medicine.  I also have a Ph.D. in pharmacology.
    Dr. Snyder. I'm always curious about this.  You said it was a privilege 
for you to have that job.  I consider it a privilege that we have you working 
for the VA system.  I appreciate you doing it.
    When you prepared for this hearing today, do they still do that silly 
stuff where you have to have your written statement signed off on by OMB?
    Dr. Perlin. Yes.  The statements, all testimony is cleared through the 
Office of Management and Budget.
    Dr. Snyder. Isn't that like the silliest thing you have ever heard of?  
You don't have to clear that statement with OMB.

    [Laughter.]
 
    Dr. Perlin. It is a complex process.
    Dr. Snyder. That's being polite.
    I apologize for being late.  It would probably be kind of like the movie 
Groundhog Day for you, that I will ask you questions you have already dealt 
with.
    I am still perplexed from our last hearing, and you and I have not sat 
down and talked about this, on this whole actuarial model and why it has to 
run two and a half and three and a half years behind.  I don't know anything 
in business that runs two and a half and three and a half years behind.
    Have you all had discussions in these last two or three months where you 
have said, you know, let's target, six months from now, we are going to have a 
model that will have an 8.37 month turn around time.  You couldn't make a 
living in business with a three and a half year modeling time.
    What direction are we going in with that?
    Dr. Perlin. I think that's a very good point, and we have had discussions 
about more frequent runs of the model to make sure we are tracking closer to 
reality.
    Dr. Snyder. Is that model something that is contracted out?  Is that a 
proprietary formula and process?
    Dr. Perlin. Yes.  There are parts that are proprietary and it is 
contracted out to Millman, the actuary, who has extensive background.  Her 
organization supports managed care organizations, health plans, as well as 
some other public programs, including Medicaid, and I believe they also do 
some work for the Department of Defense.
    Dr. Snyder. It is possible to say good news/bad news.  The bad news is we 
ain't going to do this any more. The good news is you have a chance to bid on 
a contract to have an 8.5 month model.  Isn't that right?  You can just throw 
that out there and see what people come up with?
    Dr. Perlin. Yes.  We could do it cyclically.  We do it cyclically for each 
successive budget as well.
    Dr. Snyder. What reporting requirements do you have to make to Congress, 
not just budgetary, but reporting requirements you have to make to Congress 
regarding access of care and quality of care?
    Dr. Perlin. I consider it our responsibility to Congress reporting on 
anything that is asked of us.  In fact, we have not formalized the particular 
document, but I believe when the Secretary intends to meet with this Committee 
quarterly, that he would put down a selection of markers.
    Let me share with you, if I may, what I look at.  I look at six measuring 
baskets.  I look at the quality of care. I look at things that are every 
patient specific, access to care, satisfaction with the services, measures of 
restorational function.
    I look at a measure called community health, which is a basket for those 
other areas, effectiveness in research and academic mission, and then cost 
effectiveness.
    I would submit those would be the things that we should be sharing with 
you as well.
    Dr. Snyder. When you all sat down and looked at those things in whatever 
your most recent time frame was to look at those prior to all these budget 
shenanigans, did not anything stick out for you there that told you, you know, 
maybe our three and a half year, two and a half year actuarial model didn't 
reflect things that jumped out.
    Did you notice that -- I'll make something up -- our patient satisfaction 
rate went down because of waiting times. Our doctor satisfaction rate went 
down because they say I'm seeing the same number of patients but they are more 
complex now, and I'm having to work two hours overtime, or our waiting times, 
especially at clinics, our waiting times for new patient appointments.
    Is that not done in such a way that something would leap out to give you 
like the canary in the mine, something is happening out there, our models may 
be off?
    Dr. Perlin. Yes.  The area that is leaping out most prominently, as we 
have been discussing, and people have indicated, are waiting lists.  That 
indicator is showing that we have the need for these additional resources.
    Dr. Snyder. With the Chairman's indulgence, my question -- I'm sorry I 
missed the discussions earlier.
    The last time that you looked at that, did you not have a discussion that 
said waiting times are way up compared to where they were a year ago, or our 
model must be wrong?
    Did you all have that discussion or just with a world so divorced, the 
budget analysis and the model were so separate from your quality and access 
control evaluations, that you didn't put those two together, or somebody 
didn't put those two together?
    Dr. Perlin. We actually review the tracking to plan at the monthly 
performance review, and that was really the indicator that triggered these 
discussions to begin with.
    The question is how in the future can we avoid getting to this point, even 
better, making sure there is a better match of resources and needs.  That is 
our task now.
    Dr. Snyder. Thank you.
    The Chairman. Mr. Evans and I were up here talking based on Ms. Herseth's 
question, so if you could help us here.
    You have the budget you submitted to us, that included the enrollment fees 
and increase in co-pays. Congress right now lacks any political will, it 
appears, to do anything on these.
    You submit to us an 2006 budget amendment for the 1.97.  That amendment is 
added onto your budget, so overall, before Congress, is the enrollment fees 
and the increase in co-pays.
    Congress elects not to act on those.  What you said to Ms. Herseth is that 
your need then is approximately $3 billion, right, if we back those out?
    When the House passed its appropriation $1 billion over and above your 
mark, the House basically bought that out.
    Dr. Perlin. Yes.
    The Chairman. Right?  Not doing the fees and the co-pays.
    Dr. Perlin. Exactly.
    The Chairman. When you come to us and ask for the $1.97 billion, that's 
what you need now from Congress, over and above the House's mark; correct?
    Dr. Perlin. Yes, sir.
    The Chairman. I just wanted to make sure we were right on that.  Mr. 
Filner?
    Mr. Filner. Thank you, Mr. Chairman.
    I'm glad you are here, Dr. Perlin.  You have brought this whole Committee 
together.  When the Republicans are associating themselves with my remarks, 
you have done a remarkable job.

    [Laughter.]
 
    Mr. Filner. I thank you for that.  I'm not in the camp that has said 
you're not responsible.  You are responsible for what goes here.  You are 
accountable.
    We are still living in an unreal world here.  I think all this talk about 
the model is irrelevant, frankly.  That's what technicians do.  Then you have 
to live in the real world, and that's your job.
    You can have someone doing a model.  Then you have staff say, "oh, we 
have a war going on, did you take that into account?  We have Hepatitis C now. 
We didn't know about that last year."
    That's your job, and you didn't do it.  We all knew there was a problem 
before you found it.  We all knew there were freezes on hiring, either 
verbally or in memos.  People in your Administration send them to us. There 
are freezes on enrollment.  There are freezes on maintenance.
    The Chairman. That's shocking.
    Mr. Filner. Right.  Everybody knew it.  I don't know how you can continue 
to say we just found out about it.  We all knew about it.  The question is 
again, how we are going to deal with it.
    I'm going to ask you again, directly, because when I say the model is 
irrelevant, not only is it irrelevant because you have to test it against the 
real world, but the OMB seems to have a far greater impact, no matter what 
your model says.
    You asked for a figure for fiscal year 2006 from OMB.  What was that 
figure relative to what OMB recommended to the Congress?  That would be a 
more fair test of your model.
    Dr. Perlin. As I said before, there is a good bit of additional knowledge 
now in terms of where we are with the model.
    Mr. Filner. Either answer the question or say you don't want to, but don't 
give us this bureaucratic nonsense.
    I want to know what figure you sent up to OMB.  Mr. Principi answered that 
question.  He said they gave us $1.2 billion less than we asked for.  Mr. 
Nicholson said, oh, I don't know, I wasn't there.  You were there.  What 
figure did you ask for?
    Dr. Perlin. Obviously, this Committee has discussed the challenge and my 
desire to answer your question directly.
    Mr. Filner. So, you can't answer it directly?  All right.  You are 
probably better than you are appearing because you probably asked for a higher 
figure, so you are taking all the blame for something that may be not your 
fault.
    How many people are on the waiting lists for how long, and what are you 
going to do about it?  How many staff vacancies exist for how long, and what 
are you going to do about it?  What is the maintenance backlog, and how are 
they going to be fixed and in what time frame?
    This is what we do in our own house, what we do in our own budget.  If my 
son needs dental work, I'm saying I don't care what the model shows my salary 
is, I have to figure out when he's going to get his dental work.  We have an 
emergency, and I have to put the money there.  What does that do to the rest 
of my budget and how are we going to make it up?
    We all do that every single day in our household accounts, as well as 
anybody who owns a business.  We are just boggled by the fact that you can't 
do this simple thing.
    Give us that information, and give us a time line for doing it.  Nobody 
questions anybody's motivation here or your concern for veterans.  Everybody 
in your agency is concerned.  I know that.
    You are forced to give us bureaucratic nonsense that is not in accord with 
the real world, and you become an uncredible spokesman, and the Administration 
becomes uncredible, because you are talking in a green eye shade world out 
there, and somebody is putting this model out and human intellect has no role 
here.
    I would like to see, the next time you testify, some of those measures, 
not these big baskets you are talking about.  Tell us.  Why do we have to 
come out and tell you how many people are on the waiting lists?  You should 
tell us, and say what you are going to do about it.
    Dr. Perlin. Sir, those are our data.
    Mr. Filner. When I asked you, you didn't know it. I asked you earlier how 
many vacancies exist in our hospitals and how many people are on the waiting 
lists.  You didn't know.  You didn't tell me.
    Dr. Perlin. I couldn't memorize the exact number of vacancies, but I do 
know the exact number on the waiting lists.
    Mr. Filner. If there were vacancies in my agency, I could tell you the 
exact number.  I could tell you.  It's my job to eliminate those vacancies. 
It's my job to eliminate the waiting lists.  It's my job to eliminate the 
maintenance backlog.  That's your job.  Our job is to support you in that, and 
you are not giving us any way that we can support you because you are not 
giving us any data.
    I yield back.
    The Chairman. Thank you.  Mr. Michaud?
    Mr. Michaud. Thank you very much, Mr. Chairman. I, too, want to thank both 
you, Mr. Chairman, and Ranking Member Evans, for having this hearing.  Mr. 
Chairman and Ranking Member, I agree with both of you that getting the VA 
budget right is very important to me, and I will work with you both to make 
sure we do that.
    I just want to follow up, Dr. Perlin and Ms. Miller, on a question earlier 
about VISNs borrowing money to make ends meet, and the response that they 
would have to pay that back.
    It's my understanding that in VISN 1, they actually did borrow $11 
million.  My concern is with the capital needs and the increased amount of 
veterans coming back from Iraq and Afghanistan, if they had to borrow before 
and they have to pay that money back without additional funding, my concern 
is what is going to happen to VISN 1.
    Have you looked at the specifics on why they borrowed the money and if 
they have to pay it back, are they going to be able to meet the needs for our 
veterans in VISN 1?
    The other part of that question is under the CARES process, because of the 
access issue, it recommended either four or five clinics, since Maine is such 
a rural state, in Maine, plus a CBOC.
    When you look at the borrowing they have to do, the shortfalls, whether or 
not that's going to ever come to fruition.
    Ms. Miller. I think the issue of the borrowing money was really a timing 
issue more than anything else because the specific projects, which I've seen a 
list of, which did total about $11 million, were felt to be needed sooner than 
could be managed by waiting for the 2006 budget.
    Certainly, with the supplemental and with the discussions that are going 
on now about the 2006 amendment, I think that changes the scenario for the 
network, and more than likely would minimize the need for that loan.
    Mr. Michaud. My next question is to Dr. Perlin. The VA keeps referring to 
the highest priority veterans and the core group veterans.  Do these 
definitions apply to the veterans that are on Priority 7 lists?
    Dr. Perlin. Congressman, there is a policy or directive that emphasized a 
priority in terms of access to care for veterans who were 50 percent or 
greater service connected.  By definition, that would not include the Priority 
7's or Priority 8's in the system.
    All veterans are meant to be served within our performance goals, which 
are 94 percent within 30 days for primary and 93 percent within 30 days for 
specialty care.
    Our actual performance is even higher, though as your colleagues have 
alluded to, I do know and do track, because those are our data, our waiting 
lists, where that is not the case.
    Mr. Michaud. In response to the funding shortfall, in January 2003, there 
was suspended enrollment in Priority 8 veterans.  The fiscal year 2006 budget 
request fails to provide any additional funding at all for Priority 8 
veterans.  Is that going to be the policy from here on out of the VA and the 
Administration, just to leave Priority 8 veterans out there?
    Dr. Perlin. The budget request would serve those Priority 8 veterans who 
are currently in the system.  The budget request does not anticipate reopening 
enrollment to Priority 8 veterans.
    Mr. Michaud. Is that going to be the policy, that as long as the 
Administration is in office, we will never open for Priority 8's new 
enrollment?
    Dr. Perlin. I would be remiss to speculate on that.
    Mr. Michaud. No additional funding is anticipated for any new enrollments 
in Priority 8's?
    Dr. Perlin. Yes, sir.  That is correct.
    Mr. Michaud. Thank you.  Thank you, Mr. Chairman.
    The Chairman. Dr. Snyder?
    Dr. Snyder. Thank you, Mr. Chairman.
    Dr. Perlin, in your exchange with Congressman Filner, the discussion about 
the waiting lists, did you say you had some numbers in mind with regard to 
waiting lists?  I assume that was one of the things you and I were talking 
about, one of the six things you follow is waiting lists.
    Dr. Perlin. Absolutely.
    Dr. Snyder. Do you have numbers in mind?
    Dr. Perlin. Yes, sir.  There are approximately 25,000 veterans waiting for 
appointments to be scheduled at this moment.
    Dr. Snyder. Both primary care and specialty?
    Dr. Perlin. For their first new primary care visit.
    Dr. Snyder. First new primary care visit.
    Dr. Perlin. The numbers that Congressman Filner quoted were actually those 
veterans who were waiting beyond our target of serving those veterans within 
30 days.  I track those for the entire system, for the network, for the 
facility, and even the community based outpatient clinic.
    It is something that I am very acutely aware of because one of the reasons 
we track those is not because it is a bureaucratic or abstract number, it is 
real service to real veterans.
    Dr. Snyder. That should be the kind of thing, as you and I were talking 
earlier, that as you follow on month to month and year to year, you start 
seeing a trend going in the wrong direction, it should say to you maybe our 
modeling is not working, our actuarial model.
    Dr. Perlin. Yes, sir.  That is the sort of thing that tells us either 
things are working or they aren't.  In fact, between that point, January of 
2003, when that enrollment decision was made, and there were 176,000 veterans 
without appointments scheduled, and 317,000 veterans waiting over six months 
for care, that was worked down to a low of about 5,000.
    I actually think -- this is not a question of performance, it's a question 
of the lag between the time a veteran enrolls and when he gets his first 
appointment.  I think the minimum is going to be somewhere around 5,000, and 
that's just that period of time between enrollment and their first visit, so 
we are beyond that perfect steady state of getting veterans care as soon as 
they enroll.
    Dr. Snyder. When you have looked at reasons, and you listed some in your 
written statement, I think, about why the model didn't work, have you all 
thought some beyond kind of the world of the veterans' health care system as 
to why it might not be tracking as well as you may have thought it did in the 
past?
    For example, it occurs to me that we have seen an erosion in the last few 
years of employer based health care. There may be veterans who no longer have 
employer based health care, so they had to start coming to the VA.
    Or they may have been in an employer based health care system or got 
priced out of the market because of preexisting conditions, had to come to 
the VA, and then you make reference to a more complicated patient, or that 
certain retirees, their retiree health care system, more companies are 
dropping that.
    Have you all looked at why you think you may be having more complicated 
patients and that the patients require more visits?  Are those some of the 
things that have occurred to you all?
    Dr. Perlin. Dr. Snyder, that is something that in fact I did allude to in 
my statement, and one of the things we need to improve, the conditions that 
we are tracking, health insurance coverage, coverage for particular services 
and pharmaceutical coverage.
    Pharmaceutical coverage, in particular, is something that is quite 
excellent about VA's care, and we need to look at the effect of what's going 
on in the broader environment even more carefully, and even more carefully 
regionally.  It's not necessarily consistent across the country, in terms of 
how that might attract veterans into VA.
    Dr. Snyder. I think one of the problems we have as a country is we have 
not figured out how to do health care, no matter what system you are in, 
whether you are working for a private business or you are a retiree, or you 
are on Medicaid, Medicare, or military health care, Tricare.
    When one part of the system is struggling, which I think the private 
sector is, then the Government programs have to step in and make up the slack.
    Thank you, Mr. Chairman.
    The Chairman. Thank you very much.  I would like to thank Mr. Evans for 
his indulgence.  I have a series of questions to ask.
    Mr. Norris, what do you believe are the critical elements of the monthly 
performance review briefing?
    Mr. Norris. Thank you for the question, sir.  I believe that obviously 
tracking the expenditures against the planned expenditures and understanding 
the reasons for the variances for that is important, as well as comparing it 
to the previous year to see how we are tracking in relation to what we 
expected to do overall.
    I think also looking at the workload, that we want to track against our 
plan and against the previous year's experience as well. 
    Those, to me, are the two most important things. However, there are other 
areas, too, that one might want to look at.
    The Chairman. Let's drill it down again to another step.  How current is 
the data at the time of the monthly review?
    Mr. Norris. The financial data are the previous month's end of month data.
    The Chairman. When you say February, that data is what?
    Mr. Norris. When we do a performance review in March, we would be looking 
at February data.
    The Chairman. Thirty days old, approximately,
    Mr. Norris. Probably less than 30 days old at that point, because we would 
do it some time during the month of March.  Two to three weeks old.
    The workload data is somewhat more troublesome in terms of timeliness 
because we have to draw that from several databases, one, we have to wait for 
patient records to close in the field and those databases to be closed out.
    We have to match that with data out of the enrollment files, to establish 
a priority group level, to ascertain where the growth and changes are 
occurring, and then we also have to associate it with costs and assign those 
costs to each of those group levels so that we understand better where the 
costs and workload are being incurred.
    Those data matchings cause us the lag beyond the level of time that we 
would like.  More recently, we have been trying to estimate a month ahead of 
time or a month in advance of what we actually have solid data on and test 
that against later when we receive solid data to see if those estimates are 
in fact good enough for decision making.
    The Chairman. When you look at these numbers on a monthly basis, do you 
also then look at these numbers from the previous year?
    Mr. Norris. Yes, sir.
    The Chairman. When you look at them from the previous year, then you are 
able to chart a percentage up or percentage down?
    Mr. Norris. Correct.
    The Chairman. If I were to ask you to graph over the last year, could you 
tell us what that graph would look like?
    Mr. Norris. We started off fairly normally, and I believe we began to 
show-- we sort of begin to show slow growth through the early part of the 
year, and then we saw a fairly significant growth around the January time 
frame, in the January/February data, which we were looking at in the 
April/May time frame, and that's when we discovered that the problem was 
more significant than we had earlier thought it to be.
    The Chairman. Would you be able to tell me what the surge is in 
February/March that caused you to recommend this letter be sent to Congress on 
the reprogramming of funds?
    I guess what I'm trying to figure out is is the surge five percent, six 
percent, over and above 2005 to 2004? If it's five or six percent but it's 
based on 2002 data, it's really much greater.
    I'm trying to drill right into the numbers to figure out that not only 
is it the model, but maybe it's our monthly review.  I'm trying to understand.
    Mr. Norris. I understand.  I think we had projected, using the data from 
2002, and the model had projected a workload growth that would be about 2.3 
percent over what we experienced in 2004.
    In the mid-year review time frame, when we did this in the April/May time 
frame, we saw the growth was about 5.2 percent at that point, which was higher 
than we had predicted.
    The Chairman. Did you break out categories, as Mr. Michaud and Dr. Snyder 
had asked, regarding categories one through six versus seven's and eight's?
    Mr. Norris. Yes, sir.
    The Chairman. Can you tell us where that surge was coming from?
    Mr. Norris. Most of the growth was in the priority one through six, 
actually seeing some leveling out.  There is still a bit of growth in the 
Priority 7's and 8's, but quite naturally because we are not bringing in more 
Priority 8 enrollees, that population number is fixed.
    Really the growth has been in the Priority 1 through 6.
    The Chairman. Out of the one through six's, were you able to break out 
what is OIF and OEF?
    Mr. Norris. We had projected in our budget calculations about 23,000 
OIF/OEF veterans to use our services in 2005.  We are now thinking we are 
going to see probably around 100,000 this year.
    The Chairman. Wow.  This goes back to your testimony, Dr. Perlin, of 
almost three weeks ago with regard to this surge, which was not anticipated 
when this budget was put together; correct?
    Dr. Perlin. Yes, sir.
    The Chairman. Who at VHA is responsible for tracking and trending the 
spend rate?
    Mr. Norris. I do that, sir.
    The Chairman. How do you plan to keep track of the budget trends in the 
future so there is not a repeat of this?
    Mr. Norris. I think we will continue to do all the things that we are now 
doing in terms of looking at the monthly spend rates against the plan, and 
obviously, we need to refine our plans somewhat in terms of the phasing of 
those expenditures throughout the year, and ensure that what we project for a 
particular month is a little bit tighter fit than we have had in the past.
    The Chairman. Of the original request, 975, how much of the $975 million 
can actually be obligated before September 30th?
    Mr. Norris. Sir, that is an excellent question. It obviously depends on a 
lot of things.  One, primarily, it depends on -- 
    The Chairman. Let's put it this way.  What if, by next Friday, this issue 
is resolved, and you get your number, it's $975 million to $1.5 billion.  You 
are going to get a number.  The President signs it.  Bang.
    What can actually be obligated?
    Mr. Norris. We think we can obligate the majority of the $975 million.  
However, it is dependent on -- some of the repair projects, for example, 
require a competitive bid process and contracts, et cetera.
    To the extent that we are almost now to the point of only having two 
months left in the fiscal year, to the extent that process drags on they may 
or may not be able to be awarded and that money actually obligated.
    In financial parlay, we could commit that money, commit it to those 
particular projects, and it would be obligated in early fiscal year 2006.
    We think we can obligate a fairly large portion of the $975 million.
    The Chairman. When DOD reimburses the VA, at what rate is that calculated?
    Mr. Norris. Well, it depends on what the particular service is.  We have 
an agreement with DOD on outpatient rates, that we will exchange services 
based on the CMAC, that's the CHAMPUS maximum allowable charge rate, less ten 
percent, which works for us quite well in keeping things simple and 
encouraging sharing between the two departments.
    The inpatient rates are a little bit more problematic in that DOD doesn't 
have a good inpatient billing rate system yet, which they are working on and 
we are working with them.
    There are rates negotiated locally between facilities based on services 
available in either department's facility, and the cost that they incur at 
those local facilities, so they can at least recover their costs.
    The Chairman. When you testified about this increase in OIF/OEF workload, 
how will you forecast or predict future workload?
    Mr. Norris. I think one of the things, as Dr. Perlin has stated, we need 
to get improved data from DOD, which we are working on doing, and getting more 
current data. I think that's forthcoming.
    We will certainly use our most recent experience and looking at hopefully 
some discharge rates and those sorts of things that would enable us to get 
better projections of the impact of OEF/OIF or any other deployments around 
the world.
    The Chairman. Based on this, Dr. Perlin, how timely is DOD's data on 
separating OEF/OIF personnel provided to the VA?
    Dr. Perlin. It's gotten better.  Every couple of months, it's not a 
defined schedule, we get a computer file that shows separation.  I think 
there are two approaches that I plan to take.
    One is to try to get that data even more timely. The other is to be very 
conservative this year and extrapolate from the experience and anticipate the 
same or accelerated levels of service members returning.
    The Chairman. Does DOD provide the post-deployment assessments as an 
assessment tool for the VA?
    Dr. Perlin. That is a complex question.  Normally, those data are 
available.  However, they are not electronic and they are not something that 
the service member might bring with them.
    The answer is if you ask is it available, the answer technically is yes. 
Is it available in a very practical and simple way?  The answer would be no.
    The Chairman. Ms. Miller, how often do you conference or teleconference 
with all your VISN directors?
    Ms. Miller. I have a weekly phone conference with them and a monthly 
meeting.  That is with all of them as a group.  In addition to that, on a 
quarterly basis, there are individual hour long briefings with each network 
director.
    The Chairman. Are there minutes from these meetings?
    Ms. Miller. No, sir.  There are minutes for the monthly National 
Leadership Board, which includes all of the chief officers as well as the 
network directors.  There are agenda's for the weekly teleconferences, but 
there are no minutes.
    The Chairman. How candid are your VISN directors with you?
    Ms. Miller. I would say they are generally pretty candid.
    The Chairman. What has been the trend in VHA's backlogs in ambulatory and 
specialty care appointments for the past 12 months?
    Ms. Miller. Actually, the trend on the totals is a good trend.  It is that 
we are seeing an increased proportion of the total appointments, the 95 
percent in primary care, and the 94 percent in specialty care, within the 30 
day time line, an improvement in those that are above 30 days to bring them 
down below the 90 days, where we have seen a decremental performance is in 
those who are waiting for their first appointment.
    The Chairman. Would you please provide to the Committee graphics to 
support the answer that you have just given me?
    Ms. Miller. Yes, sir; I will.
    [information requested is found on p. 55]

    The Chairman. Ms. Miller, have there been any documented cases where 
returning OIF/OEF service members have been denied care?
    Ms. Miller. Sir, not that I'm aware of.  We have repeatedly reinforced to 
the field the importance of providing those services in a timely, 
compassionate and seamless manner.
    The Chairman. Do you know of any documented cases where returning OEF/OIF 
service members have been given an appointment that is more than 30 days?
    Ms. Miller. Yes, sir.  I do believe there are cases of that type, and I 
know specifically in the dental arena, we have a backlog of cases.  We are 
working on those with $10 million that has been provided to the field to 
address that specific issue.
    The Chairman. What has happened here is individuals, who are very upset, 
in particular, your critics, what they do is they latch onto the new veteran 
to say you don't care about them or you are not funding them.  You have heard 
all the rhetoric that's out there.
    I'd like for you, Ms. Miller, at your next meeting with all these VISN 
directors, I want you to go back and ask them this question, please, on 
whether or not they know of any cases of OIF/OEF service members that have 
been denied any form of care.
    Ms. Miller. Yes, sir.
    The Chairman. I also would like to know immediate action taken in the 
field to ensure that any of these soldiers, sailors, airmen, Marines that are 
returning are beyond 30 days.
    Ms. Miller. Yes, sir.
    The Chairman. At what point were you informed of funding concerns from 
facilities and VISN directors, that they were having to take actions in the 
field?
    Ms. Miller. Sir, I think when we got into the first of the calendar year, 
people began to identify that it was going to be a very tight and difficult 
year.
    They began to hold on equipment and NRM purchases until they saw where the 
year was going, and as we moved along, it became clear that they were going to 
have to use the NRM and equipment money for operational purposes.
    At the same time, they were focusing on advanced clinic access to try and 
work down the waiting lists and improve productivity, and we were monitoring 
closely with them compliance on national contracts and pharmaceutical 
procurements, et cetera, to try to ensure that they were being the most 
efficient they could be.
    The Chairman. You said that was in the January time frame?
    Ms. Miller. In January and February, early in the year, people began to 
say, you know, we are seeing this increase, as Mr. Norris said, in the 
workload, and they began to hold back on moving ahead with their equipment 
and NRM money.
    The Chairman. I'm not so certain how that reconciles with Mr. Norris' 
testimony with regard to the monthly review assessments.  Things were tracking 
fine until they began to see this spike in February/March/April.
    If you are hearing from the field that they got crunch problems in January 
and it's not being reflected in this monthly assessment -- do you two talk?
    Ms. Miller. Yes, sir; we do.
    Mr. Norris. Sir, let me clarify.  I meant to say, if I didn't say it 
clearly, there was slight workload increase in the early parts of the year, in 
the early months, but they weren't alarming at that point.  However, as we hit 
the mid-year point and looking at the January/February data, it was getting to 
the alarming point.
    The Chairman. I don't know how to define "alarming."  Let me go to you, 
Ms. Miller.
    When was it brought to your attention that facilities were beginning to 
curtail services?
    Ms. Miller. Sir, I don't believe that facilities were curtailing services 
in that period of time.  I think they were acknowledging that things were 
tight.  They were looking carefully at their budget and managing tightly.
    They were refraining from moving forward with planned equipment or NRM, 
as I mentioned.  They acknowledged at that point in time that they were not 
prepared to move forward with some CBOCs, but I'm not aware they were 
curtailing services, per se.
    The Chairman. When did facilities start to send out letters of dis-
enrollment?
    Ms. Miller. I would like to make a distinction between enrollment and 
appointment.  We do not dis-enroll any veteran.
    When a facility -- 
    The Chairman. If a veteran had not used a facility over the last two 
years, were letters sent out saying you will be dis-enrolled from the system?
    Ms. Miller. Not that I'm aware of, sir.
    The Chairman. What letters were sent out with regard to appointments?
    Ms. Miller. When a facility is unable to provide service in a timely way, 
within our guidelines, our policy requires them to notify a veteran that they 
are on a waiting list.
    Generally, we find it is not an appropriate thing to provide appointments 
more than four months out, because often times, that appointment will not be 
at a convenient time, the veteran will not show for the appointment.  It will 
be a wasted time slot.
    There is a policy that says when we cannot provide you with an appointment 
in a timely way, that we want you to utilize the electronic wait list at the 
local site and take people off that wait list as expeditiously as possible, 
but to notify people that in urgent or emergent situations, we would see them 
immediately.
    The Chairman. If I wanted an appointment and I couldn't get my appointment 
for four months, am I being denied a service?
    Ms. Miller. You are certainly being delayed in the service and it's not 
good customer service and it's something that we are trying to overcome, sir.
    The Chairman. All right.  You have testified that you were not informed of 
facilities that took any actions that may have curtailed services; is that 
correct?
    Ms. Miller. I'm not aware of people, for instance, closing services down.
    The Chairman. You testified that your VISN directors are candid with you 
in these teleconferences?
    Ms. Miller. Yes, sir.
    The Chairman. Of which you don't take minutes.  Do you take notes?
    Ms. Miller. No, sir.
    The Chairman. That's clever.  When was it brought to your attention that 
critical maintenance was being deferred?  When did your VISN directors talk 
about deferring maintenance, facilities, equipment?
    Ms. Miller. As I testified earlier, early in the calendar year, it became 
clear that people were going to need to defer equipment and maintenance 
procurements for operational purposes.
    The Chairman. When did you then speak to Dr. Perlin about what you are 
hearing from your VISN directors?
    Ms. Miller. I try to keep Dr. Perlin informed on an ongoing basis.
    The Chairman. That is not responsive.  You have testified to January. 
When you started first hearing this from the field, did you go to Dr. Perlin 
and tell him what you were hearing from the field?
    Ms. Miller. My memory of exactly when is not clear.
    The Chairman. Notes and minutes would help, wouldn't they?
    Ms. Miller. Yes, sir; they would.  Early in the year, I would say that I 
shared that information with Dr. Perlin.
    The Chairman. Early in the year.  I'm not the prosecutor.  I don't mean to 
be interrogating you like one.  I assure you that I've prosecuted the greatest 
wordsmith I ever met in my life, named Bill Clinton.
    I've had it.  Do you have any follow up questions?
    Committee Counsel. Dr. Perlin, just a quick question.  Are you in 
violation of the Anti-defficiency Act in fiscal year 2005?
    Dr. Perlin. No, we are not.
    The Chairman. Mr. Michaud, any further questions?
    Mr. Michaud. No further questions, Mr. Chairman.
    The Chairman. Thank you very much.  This Committee is now adjourned.
    I will ask this of you.  I'd like for you to conduct an internal review to 
see if any personnel changes need to be made within the department, and report 
that to the Secretary.
    I would also ask for the GAO to conduct a thorough and comprehensive 
review of the VA's budget process.
    I will ask my colleagues on this Committee to continue to monitor closely 
this budget process, as you build the 2007 budget, to ensure that the mistakes 
that were made in 2005 and 2006 are not repeated.
    Finally, I intend in the August break, to take personal travel, and I will 
go to a specific poly-trauma center to see whether or not this allegation that 
some are making, that OIFs and OEFs are being denied their access to care.
    Those are the actions I'm going to take, based on today.  The hearing is 
concluded.
    [Whereupon, at 4:27 p.m., the Committee was adjourned.]
    
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