[House Hearing, 110 Congress]
[From the U.S. Government Publishing Office]




                  THE STATE OF THE U.S. DEPARTMENT OF
                VETERANS AFFAIRS LONG-TERM CARE PROGRAM
                           PRESENT AND FUTURE

=======================================================================

                                HEARING

                               before the

                         SUBCOMMITTEE ON HEALTH

                                 of the

                     COMMITTEE ON VETERANS' AFFAIRS
                     U.S. HOUSE OF REPRESENTATIVES

                       ONE HUNDRED TENTH CONGRESS

                             FIRST SESSION

                               __________

                              MAY 9, 2007

                               __________

                           Serial No. 110-21

                               __________

       Printed for the use of the Committee on Veterans' Affairs






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                     COMMITTEE ON VETERANS' AFFAIRS

                    BOB FILNER, California, Chairman

CORRINE BROWN, Florida               STEVE BUYER, Indiana, Ranking
VIC SNYDER, Arkansas                 CLIFF STEARNS, Florida
MICHAEL H. MICHAUD, Maine            JERRY MORAN, Kansas
STEPHANIE HERSETH SANDLIN, South     RICHARD H. BAKER, Louisiana
Dakota                               HENRY E. BROWN, Jr., South 
HARRY E. MITCHELL, Arizona           Carolina
JOHN J. HALL, New York               JEFF MILLER, Florida
PHIL HARE, Illinois                  JOHN BOOZMAN, Arkansas
MICHAEL F. DOYLE, Pennsylvania       GINNY BROWN-WAITE, Florida
SHELLEY BERKLEY, Nevada              MICHAEL R. TURNER, Ohio
JOHN T. SALAZAR, Colorado            BRIAN P. BILBRAY, California
CIRO D. RODRIGUEZ, Texas             DOUG LAMBORN, Colorado
JOE DONNELLY, Indiana                GUS M. BILIRAKIS, Florida
JERRY McNERNEY, California           VERN BUCHANAN, Florida
ZACHARY T. SPACE, Ohio
TIMOTHY J. WALZ, Minnesota

                   Malcom A. Shorter, Staff Director

                                 ______

                         Subcommittee on Health

                  MICHAEL H. MICHAUD, Maine, Chairman

CORRINE BROWN, Florida               JEFF MILLER, Florida, Ranking
VIC SNYDER, Arkansas                 CLIFF STEARNS, Florida
PHIL HARE, Illinois                  JERRY MORAN, Kansas
MICHAEL F. DOYLE, Pennsylvania       RICHARD H. BAKER, Louisiana
SHELLEY BERKLEY, Nevada              HENRY E. BROWN, Jr., South 
JOHN T. SALAZAR, Colorado            Carolina

Pursuant to clause 2(e)(4) of Rule XI of the Rules of the House, public 
hearing records of the Committee on Veterans' Affairs are also 
published in electronic form. The printed hearing record remains the 
official version. Because electronic submissions are used to prepare 
both printed and electronic versions of the hearing record, the process 
of converting between various electronic formats may introduce 
unintentional errors or omissions. Such occurrences are inherent in the 
current publication process and should diminish as the process is 
further refined.























                            C O N T E N T S

                               __________

                              May 9, 2007

                                                                   Page
The State of the U.S. Department of Veterans Affairs (VA) Long-
  Term Care Program Present and Future...........................     1

                           OPENING STATEMENTS

Chairman Michael H. Michaud......................................     1
    Prepared statement of Chairman Michaud.......................    34
Hon. Henry E. Brown..............................................     2
    Prepared statement of Congressman Brown......................    34
Hon. Timothy J. Walz.............................................     3

                               WITNESSES

U.S. Department of Veterans Affairs, Patricia Vandenberg, MHA, 
  BSN, Assistant Deputy Under Secretary for Health for Policy and 
  Planning, Veterans Health Administration.......................    22
    Prepared statement of Ms. Vandenberg.........................    52

                                 ______

American Legion, Shannon L. Middleton, Deputy Director, 
  Healthcare, Veterans Affairs and Rehabilitation Commission.....    14
    Prepared statement of Ms. Middleton..........................    40
Disabled American Veterans, Adrian M. Atizado, Assistant National 
  Legislative Director...........................................    16
    Prepared statement of Mr. Atizado............................    43
Maine Veterans' Homes, Augusta, ME, Raymond A. Nagel, Chief 
  Executive Officer..............................................     4
    Prepared statement of Mr. Nagel..............................    35
National Association of State Veterans Homes, R. Roy Griffith, 
  Chairman, Liaison Committee, and Administrator, Oklahoma 
  Veterans Center, Talihina, OK..................................     6
    Prepared statement of Mr. Griffith...........................    38
Paralyzed Veterans of America, Fred Cowell, Senior Associate 
  Director, Health Analysis......................................    18
    Prepared statement of Mr. Cowell.............................    47

                       SUBMISSIONS FOR THE RECORD

American Healthcare Association, statement.......................    55
American Occupational Therapy Association, statement.............    56
American Veterans (AMVETS), Kimo S. Hollingsworth, National 
  Legislative Director, statement................................    57
Miller, Hon. Jeff, a Representative in Congress from the State of 
  Florida, statement.............................................    58

                   MATERIAL SUBMITTED FOR THE RECORD

Priority List of Pending State Home Construction Grant 
  Applications for FY 2007, supplied by Dr. James F. Burris, 
  Chief Consultant, Geriatrics and Extended Care, Veterans Health 
  Administration, U.S. Department of Veterans Affairs, in 
  response to a request from Chairman Michaud....................    60








 
                  THE STATE OF THE U.S. DEPARTMENT OF
                    VETERANS AFFAIRS LONG-TERM CARE
                       PROGRAM PRESENT AND FUTURE

                              ----------                              


                         WEDNESDAY, MAY 9, 2007

             U.S. House of Representatives,
                    Committee on Veterans' Affairs,
                                    Subcommittee on Health,
                                                    Washington, DC.

    The Subcommittee met, pursuant to notice, at 10:02 a.m., in 
Room 334, Cannon House Office Building, Hon. Michael H. Michaud 
[Chairman of the Subcommittee] presiding.

    Present: Representatives Michaud, Hare, Salazar, Brown of 
South Carolina.

    Also present: Representative Walz.

             OPENING STATEMENT OF CHAIRMAN MICHAUD

    Mr. Michaud. The Subcommittee will come to order. I would 
like to thank everyone for coming today. Before I begin, I 
would ask unanimous consent that Mr. Walz of Minnesota be 
invited to sit at the dais of the Subcommittee hearing today. 
Hearing no objection, so ordered.
    This morning the Subcommittee on Health will examine the 
state of VA's long-term care programs and services. In terms of 
demographics, the veterans population is aging and will require 
a great amount of long-term care services. Out of a veterans 
population in this country of 25 million, nearly 45 percent are 
over the age of 65 and the number over the age of 80 is 
expected to reach 1.3 million by 2010. In addition, the veteran 
population is poorer, sicker and older than their non-veteran 
counterparts.
    The VA will also be facing an entirely new generation of 
veterans in need of long-term care services, some of our 
wounded returning Operation Enduring Freedom and Operation 
Iraqi Freedom (OEF/OIF) veterans who have different needs than 
those of our older veterans. Medicaid is a principal financer 
of long-term care. In 2004, Medicaid spent $90 billion on long-
term care services, of which $57.6 billion, or 64 percent, was 
for institutional care.
    The VA has requested $4.6 billion for long-term care 
services in fiscal year 2008. Nearly 90 percent is for 
institutional care. The VA must, in my view, maintain its 
nursing home capacity, while vigorously expanding its non-
institutionalized care capabilities. Contrary to the plain 
evidence of an increased long-term care demand, this year the 
VA will again ignore its clear legal responsibility to maintain 
its nursing home bed capacity.
    The VA's fiscal year 2008 budget estimates a further drop 
in the average daily census to 11,000, nearly 20 percent below 
the required level. I am concerned that VA is not doing enough 
to maintain its nursing home capacity, while not moving fast 
enough to provide more home and community-based care.
    An integral component of the VA's institutional care 
service is the State Veterans Home Program. Currently, State 
Veterans Homes handle over 50 percent of VA's overall patient 
workload in nursing homes. I believe we must maximize this 
existing resource, as well as other resources within our 
communities, to ensure the best possible care for our veterans.
    The VA has a long history of providing long-term care 
services and I believe that the VA has many lessons it can 
teach other areas of the Federal Government and the private 
sector on how best to provide these services. The VA can, 
indeed, be a long-term care model for others.
    VA continues to have an obligation to meet the long-term 
care needs of our veterans and I look forward to hearing from 
our witnesses today as to how the VA should meet this 
obligation in the future.
    It is now my distinct pleasure to recognize the Acting 
Ranking Member, a Member who I have served with ever since I 
came to the Veterans' Affairs Committee in different 
capacities, when I first became Ranking Member of the Benefit 
Subcommittee. Then the distinguished Chairman was Chairman 
Henry Brown. Following that Congress, I became Ranking Member 
of the Healthcare Subcommittee. At that time the distinguished 
Chairman was Henry Brown.
    And Mr. Brown has actually taken time out to come to the 
State of Maine to look at rural healthcare issues and likewise, 
I have gone to his State to look at issues in his State. And I 
really appreciate his understanding of veterans issues, as well 
as his willingness to fight for veterans' healthcare. So I 
would yield to the acting Ranking Member, Henry Brown.
    [The prepared statement of Chairman Michaud appears on p. 34
.]

         OPENING STATEMENT OF HON. HENRY E. BROWN, JR.

    Mr. Brown of South Carolina. Well, thank you, Mr. Chairman, 
and it has certainly been a pleasure of mine to serve alongside 
of you in many different capacities. But in all the capacities 
we have served together was to better enhance the quality of 
healthcare for our veterans and I commend you for your 
continuation along this path.
    I am grateful for the Members testifying before the 
Committee this morning, and I have met some you earlier and I 
look forward to hearing your testimony. I do have some opening 
remarks and I will be brief.
    Today, one of the biggest challenges in both VA and the 
private sector healthcare system is providing long-term care to 
a growing aging population. This challenge is amplified for VA 
which must facilitate care for the special needs of our 
disabled and aging veterans. The Department is also facing an 
emerging new need to care for seriously injured younger 
veterans returning from the Global War on Terror.
    I appreciate at our hearing today we have witnesses 
representing the States Veterans Homes. On Veterans Day last 
year, I had the privilege of dedicating a new State Veterans 
Home in Walterboro, South Carolina. This 220-bed facility, the 
Veterans Victory House, is one of the most modern of its kind 
in the United States and includes a 52-bed secured dementia 
unit.
    In partnership with the VA, State Veterans Homes can help 
provide a broad range of service to meet the long-term care 
needs of our veterans. Last year with the enactment of Public 
Law 109-461, the Veterans Benefits, Healthcare and Information 
Technology Act of 2006, Congress expanded the authorities for 
State Veterans Homes. The law requires VA to reimburse State 
Veterans Homes for the full cost of care for a veteran with a 
70 percent or greater service-connected disability rating and 
in need of care for service-connected conditions. It also 
ensures that veterans with a 50 percent or greater service-
connected disability receive, at no cost, medications they need 
through VA.
    Additionally, Public Law 109-461 requires VA to publish a 
strategic plan for long-term care. Hopefully, this plan that 
has been a long time in coming will provide a clear map of the 
Department's future plans for delivering long-term care for 
those veterans who rely on VA to provide these services. I look 
forward to the delivery of this plan as required by law. We 
have allowed VA to drag its feet on this issue for far too 
long.
    Mr. Chairman, we need to remember that the quality in which 
we provide long-term care is a reflection on how this country 
honors the sacrifices of our Nation's veterans.
    I look forward to our discussion today and to explore 
innovative steps we can take to provide the best patient 
centered care to enhance the quality of life of veterans in 
need of long-term care services.
    Knowing that was a busy day this is, I yield back the 
balance of my time and look forward to hearing from the 
witnesses. Thank you, Mr. Chairman. It is a pleasure to be here 
today.
    [The prepared statement of Mr. Brown appears on p. 34.]
    Mr. Michaud. Thank you, Mr. Brown. Mr. Walz, any opening 
statement?

           OPENING STATEMENT OF HON. TIMOTHY J. WALZ

    Mr. Walz. Just to keep it short for you, Mr. Chairman. 
First of all, I would like to thank you and the acting Ranking 
Member Brown for allowing me to be here. But more importantly, 
I would like to thank you for your long service to our veterans 
and your commitment to them. It is something that is well-known 
and I appreciate everything you have done.
    I would also like to thank Mr. Nagel and Mr. Griffith for 
being here today.
    As a 24-year veteran of our armed forces and someone who is 
deeply concerned with these issues here, I am here today 
because of a re-occurring issue that keeps coming up in 
Minneapolis with our Veterans Home there and it has been 
ongoing for quite some time. And I know that everyone in this 
room is here to be committed to the care of our veterans and to 
figure out the best way to do that. So I am here to listen to 
your expertise, listen to our Chairman and Ranking Member and 
try and figure out what we can do best to help you provide the 
care for our veterans and do it in a way that we avoid some of 
these problems.
    So I thank the Chairman and I yield back.
    Mr. Michaud. Thank you very much, Mr. Walz. We really 
appreciate your ongoing commitment to our veterans, as well as 
your service to this country. I appreciate that.
    I will now ask unanimous consent that all written 
statements be made part of the record. Without objection, so 
ordered.
    Mr. Michaud. And I also ask unanimous consent that all 
Members be allowed five legislative days to revise and extend 
their remarks. Without objection, so ordered.
    The first panel, it gives me a pleasure to introduce 
Raymond Nagel who is the Chief Executive Office of the Maine 
Veterans' Home, as well as Mr. Roy Griffith who is Chairman, 
Liaison Committee for the National Association of State 
Veterans Homes. I look forward to both of your testimony and we 
will start out with Mr. Nagel.

STATEMENTS OF RAYMOND A. NAGEL, CHIEF EXECUTIVE OFFICER, MAINE 
  VETERANS' HOMES, AUGUSTA, MAINE; R. ROY GRIFFITH, CHAIRMAN, 
   LIAISON COMMITTEE, NATIONAL ASSOCIATION OF STATE VETERANS 
 HOMES, AND ADMINISTRATOR, OKLAHOMA VETERANS CENTER, TALIHINA, 
                            OKLAHOMA

                 STATEMENT OF RAYMOND A. NAGEL

    Mr. Nagel. Good morning. Mr. Chairman and Members of the 
Subcommittee, thank you for the opportunity to testify today on 
behalf of the Maine Veterans' Homes on long-term care. My name 
is Ray Nagel. I am the chief executive officer of Maine 
Veterans' Homes. I have 23 years of healthcare experience, 
including 21 years as a medical service corp. in the United 
States Army and the United States Army Reserve. I am a combat 
veteran of Operations Desert Shield and Desert Storm.
    The Maine Veterans' Homes runs six long-term care 
facilities. We operate 640 skilled nursing, long-term nursing 
and domiciliary beds and we are very proud of the quality of 
the long-term care that we provide.
    Our facilities are relatively small in size, 30 to 150 beds 
each. They are located throughout the State of Maine allowing 
greater access for veterans living in the rural parts of our 
State.
    We greatly appreciate the Subcommittee's commitment to 
long-term care needs of veterans and your understanding of the 
indispensable function that State Veterans Homes perform. We 
especially appreciate the consistent support of the Veterans 
Affairs' Committee and your colleagues on the Appropriations 
Committee to ensure that per diem payments by the VA will 
continue under current eligibility criteria.
    As a Nation, we face the largest aging veterans' population 
in our Nation's history. By the end of this decade, the number 
of veterans over the age of 85 will have tripled to over 1.3 
million. The State Homes now provide about 50 percent of the 
VA's total long-term care workload and we should be treated as 
a resource that is integrated much more fully with the VA's own 
long-term care program.
    The State Homes have proposed that our beds be counted 
toward the VA's overall long-term care census which will allow 
the VA to meet its statutory requirements. Congress' goal 
should be to provide long-term care in a manner that expands 
the VA's capacity, while paying the lowest available per capita 
cost.
    The VA reports that the average daily costs of care at a VA 
long-term care facility is over $560 a day. The same costs of 
care to the VA at a contract nursing home is more than $225 a 
day. That same cost to the VA for long-term care at a State 
Home is far less, a per diem of under $68 a day. I will repeat, 
$68 a day.
    This substantially lower daily cost to the VA of the State 
Veterans Homes compared to other available long-term care 
options led the VA Inspector General to conclude that State 
Homes are an economical alternate to contract nursing homes or 
VA medical center nursing home care.
    The State of Maine, with 640 beds already in operation, has 
built all of the long-term care beds for veterans that we 
expect to build. Furthermore, we operate our long-term care 
beds at 96 percent capacity.
    If the State of Maine is to provide greater levels of 
service to its veterans, Maine Veterans' Homes must expand the 
types of services that we provide. At our 150-bed Bangor 
facility, we are proposing to construct an integrated veterans 
campus containing a community-based outreach clinic commonly 
called a CBOC, a seven-bed hospice facility, and an 18-unit 
housing facility.
    Attached to my testimony are site plans for this veterans 
campus. This campus can be constructed using solely the 
financial resources of Maine Veterans Homes, at no cost to 
Maine's taxpayers. Later, the services provided could be 
expanded to include assisting living in congregate housing, 
adult daycare and home healthcare. Our goal is to provide with 
an integrated setting comprehensive healthcare services 
covering the full continuum of care.
    Furthermore, this concept could be replicated at our other 
five facilities in order to provide the veterans throughout the 
State of Maine with easier access to comprehensive healthcare, 
both in rural and urban settings. This concept of veterans 
campus could be a model for other States.
    Mr. Chairman, we thank you for your support of this concept 
and we look forward to welcoming you to the formal announcement 
of our plans at our Bangor facility.
    In conclusion, we believe that the State Veterans Homes can 
play a much more substantial role in meeting the long-term care 
needs of veterans. We would be pleased to work with the 
Committee and the VA to explore options for developing pilot 
programs for innovative, long-term healthcare solutions and for 
more closely integrating the State Veterans Homes' programs 
into the VA's overall healthcare system.
    Mr. Chairman and Members of the Subcommittee, I would be 
pleased to answer any questions you may have of me at this 
time.
    [The prepared statement of Mr. Nagel appears on p. 35.]
    Mr. Michaud. Thank you very much, Mr. Nagel.
    Mr. Griffith.

                  STATEMENT OF R. ROY GRIFFITH

    Mr. Griffith. Mr. Chairman and Members of the Subcommittee, 
I want to thank you for inviting the National Association of 
State Veterans Homes (NASVH) to testify on the role that State 
Homes do and can play in the VA provision of long-term care.
    I especially want to thank you for allowing me to 
substitute for our national Legislative Chair, Bob Shaw, who 
was unable to make it to today's hearing due to the recent 
death of his mother.
    This morning I am speaking to you as a member of NASVH's 
Executive Committee and Chairman of our VA Liaison Committee 
where I am responsible for interfacing with the Department of 
Veterans Affairs. In addition, I am here as Administrator of 
the Oklahoma Veterans Center, Talihina, Oklahoma, which 
provides long-term care to 175 veterans, which includes 48 beds 
for dementia patients.
    Mr. Chairman, with the aging of our baby boomer generation, 
America faces a looming long-term care crisis, one that many of 
our Nation's veterans already know too well. VA provides that 
today's veteran population of 24.5 million will continue to 
fall through 2020, but that the number of veterans over 65 
years of age will rise and ultimately peak in the year 2014, 
driven by the very large number of Vietnam veterans. Most 
alarming, the number of veterans over the age of 85 is 
projected to increase by 173 percent by 2020, creating an even 
greater number of veterans seeking long-term care.
    Mr. Chairman, it is clear that the long-term care needs of 
veterans will continue increasing in the coming years and VA 
must have a fully developed plan to provide that care. Earlier 
this year, in response to a request by VA, NASVH surveyed a 
number of State Homes to determine the current unmet demand for 
State Home care. We found substantial waiting lists which 
indicate as many as 10,000 veterans currently waiting to get 
into State Homes, and we believe that there are many more who 
don't even bother to put their names on these long waiting 
lists.
    Mr. Chairman, State Homes today already provide the bulk of 
long-term care for our Nation's veterans, with more than 28,000 
beds of which 22,000 are skilled beds. Last year the U.S. 
government Accountability Office (GAO) reported that State 
Homes provide more than 50 percent of VA overall patient 
workload in nursing homes, while consuming just 12 percent of 
the VA's long-term care budget. And the trend over recent years 
shows that State Homes are increasing their share of workload 
while their share of VA's budget continues to decline. VA pays 
just $67.71 as a per diem payment for each veteran residing in 
a State Home, which is less than one-third of the average cost 
of that veteran's care.
    Compare this to VA's cost when contracting out with 
community nursing homes with VA covers a hundred percent of the 
cost, often upward of $200 per day, or when VA provides the 
care through one of its own nursing homes where the average 
cost of care is excess of $500 per day.
    Clearly, an investment in State Homes represented an 
efficient use of taxpayers' dollars, one that we hope will 
continue to receive the strong support it has in the past from 
the Committee. The State Homes Program gives you the biggest 
bang for your buck.
    However, we are deeply troubled by recent cuts in the State 
Home Construction Grant Program over the past 2 years, which is 
down from $104.3 million to $85 million, which is a total 
funding reduction of approximately $40 million in the last 2 
years.
    As a result of these real dollar reductions, as well as the 
effects of inflation and rapidly rising construction costs, the 
backlog of State Home construction projects is rapidly rising. 
There are currently $242 million in priority one projects, 
those that repair life and safety issues in the homes. NASVH 
estimates that the total backlog of all potential qualifying 
State Home projects could soon surpass $1 billion. Congress 
must increase this funding level to at least $160 million in FY 
2008 in order to reduce the rising backlog, address the most 
serious life and safety issues, and protect the State Homes 
system for the future.
    Mr. Chairman, since the Civil War, States have assumed the 
burden of care for veterans and today spend over $3 billion 
annually to provide this care, despite the fact that veterans 
of our armed forces are serving the whole Nation, not just 
their States. Seen this way, the care rendered to veterans by 
the States actually constitutes a subsidy to the Federal 
Government.
    Finally, Mr. Chairman, I would like to ask you and this 
Subcommittee to help ensure that VA moves forward with 
regulations necessary to implement legislation that has already 
passed Congress. In 2004, Congress approved, and the President 
signed Public, Law 107-422 which authorized a scholarship 
program to help nurse recruitment and retention in State Homes, 
where there is a serious nursing shortage.
    This program is modeled on a similar program that the VA 
currently operates, yet more than 3 years after the enactment, 
we are still waiting for implementing regulations. Last year, 
with your strong support, Congress passed legislation that 
provided service-connected veterans in State Homes with equity, 
both in receiving prescription medications and the 70 percent 
service-connected veterans would receive full cost of care. We 
are still awaiting these very important regulations. While we 
have had hopeful talks with the VA about this progress, we 
believe a bit of oversight by Congress can help ensure that all 
these regulations come into force this fiscal year.
    Mr. Chairman, this concludes my testimony and I would be 
pleased to answer any questions you might have.
    [The prepared statement of Mr. Griffith appears on p. 38.]
    Mr. Michaud. Thank you very much, Mr. Griffith and Mr. 
Nagel for your enlightening testimony. I have a couple of 
questions.
    The first one to Mr. Nagel. You mentioned that you plan on 
developing a veterans' campus in Bangor and I think that is a 
real innovative approach of what you are looking at, taking 
hospice and adult daycare and what have you. And you are 
looking at other facilities within Maine. Is Maine unique or do 
you think other States can take that approach? Have you talked 
to other State Veterans Homes in other areas?
    Mr. Nagel. That is a very good question, Congressman. I 
believe that the system that we are starting can be replicated 
pretty much anywhere across the country. I think it works 
extremely well on Maine's behalf because we are by large a 
rural State, and by consolidating the veterans' resources at 
the Federal, State and local levels, it allows those veterans 
in those rural areas to come to one spot instead of driving 
many, many miles out of their way to receive the care at the 
different levels.
    I would be very happy to share this with other States and I 
am sure that once our prototype is finished--and it will be 
successful--that it will be a pilot project for other States in 
the future.
    Mr. Michaud. Thank you. I have been to the facilities in my 
other capacity when I was in the State Legislature, so I am 
very familiar with the facilities and thank you for thinking 
outside the box.
    My next question is actually for both gentlemen, since you 
deal with different States, when you look at the cost 
difference for the VA for State Veterans Homes versus what the 
VA provides, there is a big difference. However, do you think 
that the current capacity--I know for Maine, you said you 
pretty much do not intend to build any more right now--do you 
think that there is capacity out there throughout the country 
to take additional beds?
    Mr. Griffith. You can tell by looking at the request for 
construction, the States wanting to build, especially in the 
areas like California, Texas, Florida, where there is a real 
large veteran population and not that many State Homes. There 
is definitely an interest for the States to build more beds.
    Mr. Michaud. And how long do you think that process will 
take if we provided adequate funding?
    Mr. Griffith. Not long. The States--to get to priority one, 
those numbers I gave you earlier--to be a priority one, the 
State already has the matching funds available, which means you 
give them the Federal funds and they start to build. They 
already have to have their architectural stuff already done and 
taken care of, so if Congress funds their side of it, the State 
is going to immediately bid it out and start building, because 
to get to priority one, you already have to have your State 
funds available.
    Mr. Michaud. Mr. Nagel, you mentioned you are pretty much 
at capacity now. Do you envision that there is going to be a 
greater need, particularly with the war in Iraq and Afghanistan 
for additional beds in Maine? And are you prepared to expand if 
need be?
    Mr. Nagel. We are prepared to expand in the future if the 
studies indicate that there will be an increased need in the 
future. I wouldn't anticipate that the veterans that are 
returning right now would be requiring our long-term care 
needs, but that is certainly something to be considered for the 
future.
    And to echo what my association has already said, I also 
believe that the other States--there may not be more reason to 
build more beds in Maine, but there is great reason to build 
State Homes in other States that have the need and the 
capacity. And there is a very good system for indicating the 
level of need by State.
    Mr. Michaud. Okay. My last question--and I see I am running 
out of time--do you feel that State Veterans Homes have the 
capacity to take care of our newer veterans in terms of 
traumatic brain injuries (TBI)?
    Mr. Griffith. That is more of a specialized care. We are 
more long-term care. That is kind of what the VA in my 
opinion--the specialty care should be done by the VA and we 
take care of what we call the primary care. Now, in Oklahoma, I 
do IV therapy in-house and we have all--so we are really a step 
above a private nursing home, because, you know, if you catch 
pneumonia and you are at the veterans center, we are going to 
put you on a IV and treat you at the veterans center, where if 
you are in a private-sector home, they are going to ship you to 
the hospital and collect these big dollars from the hospital 
for your care there. So we are kind of a--but the specialty 
care, I take--in Oklahoma, we don't do dialysis nor ventilator-
dependent. Those are the only two long-term cares that we can't 
manage there.
    Mr. Michaud. Okay.
    Mr. Griffith. In my opinion, that is what the VA should be 
doing is this specialty stuff.
    Mr. Michaud. Okay. So for anyone who needs long-term care 
that has TBI, you feel that this is best left with the VA 
system?
    Mr. Griffith. Yes.
    Mr. Michaud. Okay. Great. I thank you.
    Mr. Brown, do you have any questions?
    Mr. Brown of South Carolina. Thank you, Mr. Chairman.
    And thank you, gentlemen, for this informative briefing. 
Let me see if I can get some clarification on this. You state 
that the VA pays only about $68 a day to provide long-term 
nursing home care at State Veterans Home. However, Public Law 
109-461 requires VA to reimburse State Veterans Homes for the 
entire cost of care for service-connected disabled veterans 
rated 70 percent or higher for a veteran in need of which such 
care for a service-connected disability.
    What is your estimate of what VA will be required to pay 
for the care of these veterans under Public Law 109-461?
    Mr. Griffith. They give us five options. We have met with 
the VA, our association has, on this topic. There is five 
different options that they can do. It could go anywhere from 
the local Medicaid rate, the Medicare rate, their local 
contract rate, cost of care of our Homes nationally or 
regionally. So there is like several different ways it can go. 
Mine is, we need to the VA to hurry up and get us some 
regulations.
    I have already got families at home that saw this law 
passed and are wondering why I am still charging them. They are 
having to pay for part of their care. And I said well, until 
the VA promulgates these rules, I have no way of, you know--you 
are entitled to this.
    The law passed December 22nd. It became law March the 22nd. 
But the way--it is just like the nurse recruitment thing I was 
telling you about. It happened in 2004. We still have no 
regulations on it and we are afraid the 70 percenters are going 
to go the same route if something doesn't happen. These 
veterans are going to be sitting out there which deserve full 
cost of care.
    They are actually being drove to a private nursing home to 
get a lower level of care for free instead coming into the 
State Veterans Home and get a higher level of care, but they 
have to pay for part of that care. And that is just not right.
    Mr. Brown of South Carolina. What percent are they having 
to pay now?
    Mr. Griffith. Sir?
    Mr. Brown of South Carolina. What percent will they have to 
pay?
    Mr. Griffith. Seventy percent or more.
    Mr. Nagel. No. What percentage do they have to pay?
    Mr. Brown of South Carolina. Right. I mean what would be 
their co-payment?
    Mr. Nagel. It depends on what type of funding source that 
they have. If it is Medicare, Medicaid, and Medicaid would vary 
by State.
    Mr. Griffith. Every State is a little bit different. In 
Oklahoma, for a married veteran it is 50 percent of total 
family income, 85 percent for a single veteran. So they are 
having to actually pay for their care by using part of their 
pension, and that is not what it is for. And the law 
specifically states that they shouldn't pay.
    Mr. Brown of South Carolina. Why is it such a differential 
between the VA nursing home and the State Veterans Home?
    Mr. Nagel. I can answer that, sir. In Maine, we operate 
under a competitive model. We take the stipend money that we 
receive from the VA and we apply that to our veteran 
population. And in addition, as opposed to appropriating money 
from the State of Maine for our budget, we act as a competitive 
nursing home, just like any other for-profit company, although 
we are a public not-for-profit organization.
    So under our system, we bill Medicare and Medicaid and as a 
result, our veterans receive superb quality of care because we 
are competitive. And we are no different than any other nursing 
home chain in that aspect. We are held to the same standards, 
same quality standards and even more, because we have to be 
inspected by both the VA system, as well as our State systems. 
And it actually has proven to be a very cost effective as well 
as efficient model.
    Mr. Griffith. I have got another little approach that--I 
have been the Liaison Chairman of the National Association of 
State Veterans Homes for the past ten years and I have always 
been curious about how the VA actually costs their stuff out. 
You know, I don't know where they came up with the dollar 
figures so high. In Oklahoma, we provide--we have doctors on 
staff or on pharmacy, laboratory, ventilation therapy and our 
costs are around $220. So I don't know how they come up--but 
the numbers are there and it is their numbers we use. They are 
extremely high, but--
    Mr. Brown of South Carolina. So the $560 is a pretty 
representative number you think?
    Mr. Griffith. Those are VA's numbers we are using. I don't 
know how they come up with them, but it is their numbers and 
they are extremely high.
    Mr. Brown of South Carolina. Okay. Thank you, gentlemen, 
thank you.
    I will yield back the balance of my time.
    Mr. Michaud. Mr. Walz?
    Mr. Walz. Thank you, Mr. Chairman.
    And thank you both for your testimony and the work that you 
are doing. The need for our veterans' care, long-term care is 
unquestionable and growing and we see that and it is a trend we 
have to take into consideration. And I do appreciate what the 
State Veterans Homes have done in terms of efficient, effective 
care for our veterans.
    I am trying to understand the relationship between the VA, 
the Veterans Homes, the States and how this works. I am coming 
from this from the perspective in Minnesota that our VA 
hospital in Minneapolis is a polytrauma center, recognized as 
one of the best I would say in the world. The care is 
outstanding.
    Three blocks away we have our State Veterans Home and it 
has had continuous issues that are coming up of care, serious 
issues. And my question is on this and on the funding is, the 
way that this has been dealt with--and I have watched this 
evolve over the past couple years and I am deeply concerned 
with it--is that violations result in punitive financial hold-
backs from the institution, from the State Veterans Home.
    And I question, I ask both of you, is this the most 
efficient way to get and expect change when we are withholding 
money that is making it more difficult for them to take 
veterans in and to provide the care and it seems that it has 
spiraled into a continuous set of violations that has now 
rippled out into other things that I think may be attributable 
to the lack of resources.
    Perhaps the withholding of wages from the people involved 
with that might have been more efficient. But please, if you 
could help me understand this on this funding issue and why 
they are doing it this way. And they are under threat now that 
the Federal Government in June is going to cut all funding to 
them, which will basically shut them down at a time when we 
need them. So if you could help me with this?
    Mr. Griffith. It is a VA rule as far as I know. That is the 
only leverage they have over a State Home is to pull your per 
diem. And that is what--but if they did, if you are having 
problems because you are not paying staff enough, you are not 
getting good staff, you need some facility changes, whatever, 
if they cut your money--well, right now, if the VA would jerk 
per diem, the State Home Program would cease to exist because 
there is no way they could operate.
    So if you are already in a problem because you need more 
money to get better staff--well, I don't think pulling your 
money would be a very good solution from where I am sitting at.
    Mr. Walz. But our only option is the staffs, the VA to 
change that--the way they go about it apparently right now. I 
am very frustrated by it because it hasn't worked in the past 
and they have tried it several times. They are continuing to do 
per diem pulls every day on this thing and I am--it just seems 
to me we are in a situation we are going to lose that home. It 
is spiraling down and I have deep concern over that.
    So what would your suggestions be on this? And I ask you 
not--I know you don't know the specifics maybe of that 
institution. But how would you handle it?
    Mr. Nagel. May I----
    Mr. Walz. Sure.
    Mr. Nagel. That is a really good question. And I am not 
exactly sure how the system operates in Minnesota. But I can 
tell you that in Maine we look at this from a preventative 
standpoint. We have extremely tight, stringent internal 
controls. And because we operate as a competitive type of 
facility as opposed to a State institution or an appendage of 
the State, we have two sets of internal control mechanisms that 
we have to respond to at least twice a year. And that is the VA 
oversight which is pretty strict----
    Mr. Walz. Right.
    Mr. Nagel [continuing]. As well as the State and Federal 
Medicare or Medicaid guidelines. Now, in States that don't 
participate in Medicare or Medicaid, they won't have those 
guidelines that they have to follow as well. So in Maine, we 
have the guidelines that we have to meet under Medicare/
Medicaid, as well as the VA and we also initiate--because we do 
operate as a private type of organization, we have a very, very 
strict peer review council where members of different 
disciplines go from one home to another and they do pre-
evaluations on those homes and they are pretty scathing and it 
keeps us in line.
    So in a nutshell, what I will tell you is that we basically 
look at it from a preventative standpoint and that by doing 
that, it helps to avoid the costly penalties that would happen. 
Now, and one more thing is that the VA's penalizing of stipend, 
I would not agree with it either. But it is no different, 
honestly, than what Medicare does. And Medicare does what is 
called a civil monetary penalty, Medicare/Medicaid. So if you 
have deficiencies, they fine you. So it is very similar in that 
regard.
    Mr. Walz. Very good. Thank you.
    Thank you, Mr. Chairman.
    Mr. Michaud. Thank you.
    Mr. Hare.
    Mr. Hare. Thank you, Mr. Chairman. My apologies for getting 
here a little late. So if the questions that I am asking have 
already been covered, I hope you will bear with me. There have 
recently been reports that some of the State Veterans Homes 
aren't safe or the quality of care isn't what it should be.
    How can the VA better ensure that these homes perform to 
the national standards that are required of them? What can we 
do or what should the VA be able to do to get these homes up to 
standard?
    Mr. Nagel. Personally?
    Mr. Hare. Sure.
    Mr. Nagel. Personally I think that the State Homes should 
be following both the VA standards as well as the Medicare/
Medicaid guidelines. If they are following Medicare or Medicaid 
guidelines, they are going to have two sets of eyes that are 
looking at them all the time. And that is a built in internal 
control mechanism that ensures quality to the patients.
    Mr. Griffith. That is one thing our association has talked 
about for years with the VA, is why the VA doesn't use CMS 
guidelines. The VA writes their own regulations. CMS has got 
theirs. We are being inspected by two different sets of 
regulations. With being two Federal agencies--and this is my 
personal--I don't know why that we are not inspected by the CMS 
regulations. Because if you are Medicare or Medicaid, CMS comes 
in with their regulations, VA comes in with their regulations. 
And we are like them. We have a peer review of our own internal 
agency that does our own peer review which in Oklahoma is 
tougher than the other two.
    But they are all using different sets of regulations and 
mine is, I don't know why that the VA and CMS doesn't get 
together, or the VA use their regulations. I mean because they 
are tough and they provide--they are geared toward quality of 
care. But we in the field have to kind of dance to both tunes 
at the same time.
    Mr. Hare. Okay. Thank you. Mr. Griffith, you mentioned in 
your testimony that the State Homes in Oklahoma are developing 
programs or plans for more adult day healthcare programs and 
other approaches to developing care in less restricted 
settings. I wonder----
    Mr. Griffith. Yeah, it is in Maine. We are not doing adult 
day healthcare in Oklahoma yet.
    Mr. Hare. Okay. Well, I am wondering if you could elaborate 
on what other emerging approaches, other things that you are 
doing and is this just restricted to the State or are there 
other State Homes trying to do the same?
    Mr. Nagel. Well, we are trying to bring--there is an idea 
in the Army and it is called far forward medicine. And in Maine 
they didn't call it that, but they thought of it before the 
Army did. And I think they did it out of necessity because the 
State is pretty rural.
    So rather than--in certain States they have large compounds 
where the State Veterans Homes are at. In Maine they decided to 
build smaller facilities, but locate them all over the State so 
that it would serve that area of the State. So it is much more 
patient friendly, if you will.
    And taking that one step further and thinking outside of 
the box, what we have done is, we have such a good relationship 
in Maine between all levels of the veterans service 
organizations, whether it is at the Federal level, State, 
community, local. We have gotten together with all of them and 
we have decided to take that idea one step further and try and 
put the Federal, the State and the community veterans services 
on one little campus, on those campuses so that they don't have 
to travel to numerous places to receive the services that they 
are entitled to.
    And we are starting with our Bangor campus because it is a 
proven facility. We have willing partners there. And the VA 
hospice physician approached us asking us to open up a hospice 
there. So we have plans to open up a hospice, a seven-bed 
hospice there adjacent to our facility, which is something that 
I think that the VA should actually start paying a stipend for, 
because I think that is a big----
    Mr. Hare. I agree.
    Mr. Nagel [continuing]. Need. We are also opening up--we 
are hoping to link with the VA and open up a community-based 
outpatient clinic which right now is located a couple miles 
away. And this way they would--our same residents would be able 
to access medical care there with the doctors that they already 
see. And we are hoping possibly 1 day to build maybe adult 
daycare, as well as veteran housing. So those are the programs 
that we are looking at currently.
    Mr. Hare. That is great. Thank you very much, Mr. Nagel.
    I yield back, Mr. Chairman.
    Mr. Michaud. Thank you.
    Mr. Salazar.
    Mr. Salazar. Mr. Chairman, I have no questions at this 
time.
    Mr. Michaud. Thank you.
    Before we release the panel, I just want to ask one 
question of Mr. Griffith.
    You mentioned the two different regulations between the VA 
and the CMS. Which is the tougher of the two?
    Mr. Griffith. The CMS.
    Mr. Michaud. The CMS, okay.
    Mr. Griffith. Seems to be. I am not survey, but a lot of 
the States are. Maine is one of them. Colorado is one. Ours is, 
we just--and we have asked this--as Liaison Chairman, we meet 
with the VA twice a year and we have asked for this one reg for 
years and there is one reason or another we haven't done it. 
But it really makes a lot of sense that if you are being 
inspected, you should be inspected by one regulation.
    Mr. Michaud. Great. Well, once again, I would like to thank 
both of you gentlemen for your testimony and answering 
questions. It has definitely been very helpful. So thank you 
both very much.
    Mr. Griffith. Thank you, Mr. Chairman.
    Mr. Nagel. Thank you, sir.
    Mr. Michaud. I would ask the second panel to come forward. 
The second panel consists of Shannon Middleton, who is the 
Deputy Director of Healthcare, Veterans Affairs and 
Rehabilitation Commission for the American Legion, Mr. Adrian 
Atizado, who is the Assistant National Legislative Director for 
Disabled American Veterans, and Fred Cowell, who is the Senior 
Associate Director, Health Analysis for the Paralyzed Veterans 
of America. I want to thank all three for coming today. I look 
forward to hearing your testimony. And we will start with Ms. 
Middleton.

  STATEMENTS OF SHANNON L. MIDDLETON, DEPUTY DIRECTOR, HEALTH 
CARE, VETERANS AFFAIRS AND REHABILITATION COMMISSION, AMERICAN 
   LEGION; ADRIAN M. ATIZADO, ASSISTANT NATIONAL LEGISLATIVE 
 DIRECTOR, DISABLED AMERICAN VETERANS; AND FRED COWELL, SENIOR 
  ASSOCIATE DIRECTOR, HEALTH ANALYSIS, PARALYZED VETERANS OF 
                            AMERICA

               STATEMENT OF SHANNON L. MIDDLETON

    Ms. Middleton. Mr. Chairman, Members of the Subcommittee, 
thank you for this opportunity to present the American Legion's 
views on VA's strategic direction and plans to address the 
aging veteran population and the needs of recently separated 
veterans.
    A July 1984 study, ``Caring for the Older Veteran,'' 
predicted that a wave of elderly World War II and Korean 
Conflict veterans would occur some 20 years ahead of the 
elderly in the general U.S. population and had the potential to 
overwhelm the VA long-term care system if not properly planned 
for.
    The study cited an imminent need to provide a coherent and 
comprehensive approach to long-term care for veterans. Twenty-3 
years later, the comprehensive approach prescribed has yet to 
materialize.
    The American Legion supports a requirement to mandate that 
VA publish a comprehensive long-term strategic plan. In recent 
testimony, GAO indicated that veterans' access to 
noninstitutional long-term care was still limited by service 
gaps and facility restrictions. GAO assessment demonstrated 
that for four of the six services, the majority of facilities 
did not offer the services or did not provide access to all 
veterans living in the geographic area.
    On the issue of nursing home care, VA has been equally 
resistant in complying with the mandates of the Millennium Act. 
The Act required VA to maintain its in-house nursing home care 
unit bed capacity at the 1998 level.
    The American Legion believes that VA should be required to 
restore its nursing home care unit capacity as intended by 
Congress to the 1998 level. Additionally, VA should be 
prohibited from including any but their own nursing home care 
unit beds for the purpose of compliance with the provisions of 
the Millennium Act.
    VA claims it cannot maintain both the mandated bed capacity 
and implement all the requires of the Millennium Act. The 
American Legion believes VA should provide the quality of care 
mandated by Congress for the long-term care of America's 
veterans and Congress should provide adequate funding to VA to 
implement its mandates.
    Since 1984, nearly all planning for VA inpatient nursing 
home care has revolved around State Veterans Homes and 
contracts with public and private nursing homes. Currently, VA 
is authorized to make payments to State for construction and 
maintenance of State Veterans Homes. Recognizing the growing 
long-term healthcare needs of older veterans, it is essential 
that the State Veterans Home Program be maintained as a viable 
and important alternative healthcare provider to the VA system.
    In testimony delivered in 2006 addressing VA long-term 
care, GAO identified estimating which veterans will seek care 
from VA and what their nursing home needs will be as a major 
challenge in VA's ability to plan for nursing home care. The 
unpredictability of long-term care needs of those suffering 
from polytrauma, blast injuries and lasting mental health 
conditions as a result of participation in the ongoing Global 
War on Terror will no doubt make planning even more 
challenging.
    The Commission on the Future for America's Veterans was 
established to ascertain the needs of veterans 20 years in the 
future. The Commission has been conducting townhall meetings 
around the country to allow veterans, family members and 
caregivers an opportunity to express their views on the future 
needs of servicemembers, especially those who have been injured 
in the current Global War on Terror.
    At the conclusion of this fact finding initiative, the 
Commission will create a report that will include 
recommendations for addressing the needs identified. The 
Commission plans to deliver recommendations to the President, 
Congress and the American public by Memorial Day 2008 and the 
American Legion supports this timely and proactive endeavor in 
the hopes that VA and Congress will utilize the findings to 
prepare for long-term care needs of the newest era of war 
veterans.
    A new generation of young Americans is once again deployed 
around the world answering the Nation's call to arms. 
Unfortunately, without urgent changes in healthcare funding, 
new veterans will soon discover that their battles are not 
over. They will be forced to fight for the life of a healthcare 
system that was designed specifically for their unique needs.
    The American Legion believes that the solution to the 
Veterans Health Administration's recurring financial 
difficulties will only be achieved when VA funding becomes 
mandatory. Under a mandatory funding, VA healthcare would be 
funded by law for all enrollees who meet the eligibility 
requirements, guaranteeing yearly appropriations for the earned 
healthcare benefits of enrolled veterans.
    The Veterans Health Administration is now struggling to 
meet its requirement to provide timely access to care and the 
American Legion believes that healthcare rationing for veterans 
must end. It is time to guarantee healthcare funding for all 
veterans.
    Mr. Chairman, this concludes my testimony. Again, thank you 
for giving the American Legion an opportunity to present its 
views on this important issue.
    [The prepared statement of Ms. Middleton appears on p. 40.]
    Mr. Michaud. Thank you very much.
    Mr. Atizado.

                 STATEMENT OF ADRIAN M. ATIZADO

    Mr. Atizado. Mr. Chairman, Members of the Subcommittee, I 
want to thank you for this opportunity to present the views of 
the Disabled American Veterans on the present and future state 
of VA's long-term care programs.
    I will try to cover as many items that DAV believes to be 
with regards to overarching issues that exist today that hold 
tremendous sway over the future of VA long-term care programs.
    As with this Committee, the DAV is greatly concerned about 
the last published strategic plan for VA's long-term care which 
was prepared over 7 years ago. Whatever strategic planning VA 
has for the program, the DAV is also concerned that VA has not 
sought involvement, input or advice from veteran service 
organizations, unlike the 1999 strategic plan in which this 
community was directly involved.
    The 1998 report of the Advisory Committee on the Future of 
VA Long-Term Care compelled this 1999 VA strategic plan. 
Sustaining this momentum, passage of Public Law 106-117, 
Veterans' Millennium Healthcare and Benefits Improvement Act, 
brought about some degree parity between long-term care and 
acute care. However, some bias remains within VA's medical 
benefits package that has translated down and between 
institutional and noninstitutional extended care.
    By policy, noninstitutional services must be made available 
to all enrolled veterans in need of such care. But VA is 
required to provide institutional services only to a subset of 
these enrolled veterans.
    Mr. Chairman, coupling this protocol with a tremendous 
pressure of limited resources requires VA to drive down the 
costs of care while increasing the number of veterans served. 
This produces a synergistic effect that puts long-term care at 
a disadvantage against other services in VA's medical benefits 
package, and all the more so for the resource intensive 
institutional extended care service line.
    It is without doubt that our concern remains about VA's 
obvious shift away from meeting its statutory mandate of 
maintaining nursing home capacity. This practice must be 
addressed considering VA's own projection of the growing gap 
between capacity and demand. As VA shifts more of its 
institutional care workload to State Veterans Homes, we applaud 
Congress for taking what we hope is a first step to provide 
equitable relief to State Veterans Homes.
    What seems to be lost is what DAV believes, that long-term 
care is a fundamental part of the continuum of medical care. 
Further, while institutional care has been painted with a broad 
brush, it is most certainly still needed. As our colleagues 
from the State Veterans Homes have testified, particularly for 
veterans that VA has termed hard to place patients.
    While VA has become highly efficient at converting its non-
service-connected community nursing home placements to Medicaid 
status, it has established no formal tie to centers of Medicaid 
and Medicare services, or with the States to oversee that 
unwritten policy.
    Also, with regards to institutional and home hospice, 
despite offering to purchase hospice, VA refers thousands of 
veterans from its own program to those of Medicare without 
acknowledging it is doing so.
    Mr. Chairman, VA is the only public healthcare system that 
charges co-payments to hospice patients. The DAV recommends the 
fulfillment of Congress' original intent in Public Law 108-422 
in exempting veterans from having to pay co-payments when they 
receive VA hospice care in any setting.
    As a number of dying veterans have increased to a current 
average of 1,800 a day, it is unconscionable to use co-payments 
as a healthcare utilization tool on dying veterans. With regard 
to noninstitutional care, the DAV believes growing its capacity 
is important to meet the swelling long-term care needs of aging 
veterans.
    We applaud VA leadership in eliminating local restrictions 
that depress capacity and limit access to noninstitutional 
care. However, the reports we continue to receive about 
veterans not receiving the care they need for their service-
connected conditions tells us more needs to be done, 
particularly in the funding level that VA requests or that 
which Congress provides.
    In closing, Mr. Chairman, the DAV urges this Subcommittee 
to consider holding additional hearings in order for Congress 
and the public to gain fuller understanding of what needs to be 
done for our Nation's aging, sick and disabled veterans.
    This concludes my statement and I would be happy to answer 
any questions you may have.
    [The prepared statement of Mr. Atizado appears on p. 43.]
    Mr. Michaud. Thank you very much, Mr. Atizado.
    Mr. Cowell.

                    STATEMENT OF FRED COWELL

    Mr. Cowell. Mr. Chairman and Members of the Subcommittee, 
the Paralyzed Veterans of American (PVA) is pleased to present 
its views concerning access to and the availability of quality 
long-term care service for our Nation's veterans.
    In the interest of time, PVA's oral testimony is focused in 
two primary areas with brief mention of other important issues.
    The long-term care needs of younger OIF/OEF Veterans. Mr. 
Chairman, PVA believes that age-appropriate VA noninstitutional 
and institutional long-term programming for younger OIF/OEF 
veterans must be a priority for VA and your Subcommittee. New 
VA noninstitutional and institutional long-term programs must 
come online and existing programs must be reengineered to meet 
the various needs of a younger veteran population.
    VA's noninstitutional long-term care programs will be 
required to assist younger veterans with catastrophic 
disabilities who need a wide range of support services, such as 
personal attendant services, programs to train attendants, peer 
support programs, assistive technology, hospital-based home 
care teams that are trained to treat and monitor specific 
disabilities, and transportation services.
    These younger veterans need expedited access to VA benefits 
such as VA's Home Improvement/Structural Alteration grant and 
VA's adaptive housing and auto programs, so that they can leave 
institutional settings and go home as soon as possible.
    VA's institutional nursing home care programs must change 
direction as well. Nursing home services created to meet the 
needs of aging veterans will not serve young veterans well. As 
pointed out in the Independent Budget, VA must make every 
effort to create an environment for younger veterans that 
recognizes they have different needs.
    Younger, catastrophically injured veterans must be 
surrounded by forward-thinking administrators and staff that 
can adapt programs to youthful needs and interests. The entire 
nursing home culture must be changed for these individuals, not 
just modified.
    For example, therapy programs, living units, meals, 
recreational programs and policy must be changed to accommodate 
younger veterans entering the VA long-term care system.
    Veterans with spinal cord injury and disease. PVA is 
concerned that many veterans with spinal cord injury and 
disease are not receiving the specialized long-term care 
services they require. Today's VA Spinal Cord Injury and 
Disease (SCI/D) long-term care capacity cannot meet current or 
future demand for these specialized services. Waiting lists 
exist at the four designated SCI/D long-term care facilities. 
Geographic accessibility is a major problem because none of 
these facilities are located west of the Mississippi River.
    VA's own Capital Asset Realignment for Enhanced Services 
(CARES) data for SCI/D long-term care reveals a looming gap in 
long-term care beds to meet future demand. VA data projects an 
SCI/D long-term care bed gap of 705 beds in 2012 and a larger 
bed gap of 1,358 beds for the year 2022.
    Methods for closing the VA SCI/D long-term care bed gap and 
resolving the geographic service issue are part of the same 
problem for PVA.
    VA's construction budget for 2008 includes plans for new 
120-bed VA nursing homes to be located in Las Vegas, Nevada, 
and at the new medical center campus in Denver, Colorado. Also, 
VA has announced construction planning of a new 140-bed nursing 
home care unit in Des Moines, Iowa.
    Mr. Chairman, PVA needs your support to ensure VA nursing 
home construction planning includes the percentage of beds at 
each new VA nursing home facility for veterans with SCI and D. 
PVA requests that Congress mandate that VA provide for a 15 
percent bed set aside in each new VA nursing home construction 
project to serve veterans with SCI/D and other catastrophic 
disabilities.
    A 15 percent bed allocation in new VA nursing home 
construction projects would be a good first step toward 
resolving and improving the VA SCI/D long-term care bed 
capacity problem.
    Mr. Chairman, PVA's written statement includes important 
detailed information on other VA long-term care issues that we 
feel deserve your consideration, such as the nursing home 
capacity mandate, the State Veterans Home life safety issues, 
and waiting lists for noninstitutional long-term care services.
    PVA supports the Congressional decision to require VA to 
develop a strategic plan for long-term care. However, for this 
new plan to become a success, it must be a living document that 
contains positive and achievable recommendations and provisions 
for accountability. PVA supports a strategic long-term care 
plan that monitors the quality, availability and the 
appropriate balance between noninstitutional and institutional 
long-term care programs.
    VA's strategic plan will also enable Congress to make 
better informed decisions regarding the provision of adequate 
financial resources to support VA care. If done correctly, VA's 
strategic long-term care plan will assist VA's planning and 
monitoring efforts to ensure appropriate programming, 
systemwide availability and quality of services.
    Mr. Chairman, that concludes my remarks. I would be happy 
to answer any questions you may have.
    [The prepared statement of Mr. Cowell appears on p. 47.]
    Mr. Michaud. Thank you very much.
    I really enjoyed the testimony of this panel as well. My 
first question for each of you is have your organizations heard 
of any problems with veterans not getting access to a bed 
because of a shortage of beds?
    Mr. Cowell. Well, our members have problems. There are 
waiting lists for the four designated SCI/D long-term care 
facilities, Mr. Chairman. Those facilities are located in 
Brockton, Massachusetts, Castle Point, New York, Hampton, 
Virginia, and the residential care facility at Hines, Illinois. 
It is our understanding that all four of those facilities have 
waiting lists for our members.
    Also, because of the high acute needs of paralyzed veterans 
they are often shunned and denied access to both community 
nursing home facilities, VA nursing homes and in some cases 
State Veterans Homes. So we have an access problem.
    Mr. Michaud. And do you know how long that waiting list is 
at each of the facilities?
    Mr. Cowell. Well, I can't speak for each facility, but the 
most recent information we have at the Hampton facility, that 
could be up to a year and it is kind of an attrition issue. 
They need a veteran either to leave the facility, or in some 
cases to die before a new bed becomes available.
    Mr. Michaud. Okay. And the DAV, have you heard problems 
from your members?
    Mr. Atizado. Yes, Mr. Chairman, sparingly. But our greater 
concern is from here on, what is happening with the capacity to 
provide institutional long-term care paid for or provided by VA 
at the current level. And recent trends really lead us to be 
greatly concerned about how this is going to fit into the 
demographic imperative of the aging population. That is really 
what we are concerned about.
    Mr. Michaud. Okay. And the American Legion, have you heard 
of problems with your members accessing beds for long-term 
care?
    Ms. Middleton. Mr. Chairman, I haven't--I am not aware of 
any so far. However, I do know that I haven't had a chance to 
speak with the different departments to see whether or not they 
have had any situations. And I am sure that there have been 
instances that I am just not aware of at this point. But I can 
find out for you.
    Mr. Michaud. Great. The next question is for all three of 
you. As we heard from the State Veterans Homes, when you look 
at the regulations, the VA has certain regulations and the CMS 
has certain regulations. From what we are told, the CMS has 
stronger regulations. How would the American Legion feel about 
adopting the CMS regulations if they are stronger?
    Or while you are thinking about that, how about DAV?
    Mr. Atizado. Mr. Chairman, I can't speak intelligently 
about CMS' standards with regards to the quality of care 
provided in institutional settings. But if the State Veterans 
Homes believes this to be true, then obviously if it fosters 
higher quality of care, then I believe DAV would support that.
    Mr. Michaud. Okay. PVA.
    Mr. Cowell. I am sure we echo his remarks, Mr. Chairman. 
Also, I am not just sure who accredits the States Veterans 
Homes. But accreditation of a long-term care facility is an 
important step. And if you are just talking about the 
operational guidelines that CMS would require, I think that is 
a positive step. But also accreditation is something that 
should be looked at if it doesn't currently happen.
    Mr. Michaud. Okay. American Legion, have you--are you still 
thinking? Okay.
    Ms. Middleton. I would agree to agree with what they said, 
echo what they said also.
    Mr. Michaud. Okay. Thank you.
    My next question, Mr. Atizado, is in your statement you had 
mentioned about the co-payments for hospice care. And if you 
don't know, hopefully the VA will be able to give me the 
number, what is the total amount of money those co-payments 
bring in? Do you have any idea?
    Mr. Atizado. I have a rough idea, Mr. Chairman. But it is 
rather dated, not more than a couple years. I think it is 
around $5,000 in collections.
    Mr. Michaud. Five thousand?
    Mr. Atizado. In collections.
    Mr. Michaud. Five thousand dollars in collections?
    Mr. Atizado. Yes, sir.
    Mr. Michaud. Total? Okay. Also relating to that same issue, 
you had mentioned that some VA facilities have been aggressive 
in establishing end of life programs while others have lagged 
behind. Do you have a list of those who are lagging? Or could 
you provide the Committee----
    Mr. Atizado. We are talking about hospice?
    Mr. Michaud. Yes, hospice.
    Mr. Atizado. I apologize. I don't have that off the top of 
my head. I can get that information for you though, sir. So if 
I could submit that for the record to you, I would greatly 
appreciate it.
    [The information was subsequently provided by the U.S. 
Department of Veterans Affairs in materials requested during 
the hearing, which appear here.]
    Mr. Michaud. Okay. Great. No problem. Thank you very much.
    Mr. Brown.
    Mr. Brown of South Carolina. Thank you, Mr. Chairman. I 
just would like to thank the witnesses for their informative 
testimony and I don't have any questions. But thank you all for 
coming.
    Mr. Michaud. Mr. Hare.
    Mr. Hare. Thank you, Mr. Chairman.
    I have a question for all three of you folks. You know, we 
have a lot of OEF and OIF veterans returning with catastrophic 
injuries that are going to require them to get care for the 
rest of their lives. And this generation is generally younger. 
They are computer literate. They have children and high 
standards for the type of care that they need, obviously.
    At the same time, you have an aging population with very 
different needs. So from your perspectives, what goals do you 
think the VA should be working toward to provide extended care 
to this diverse group of vets?
    Mr. Cowell. Well, sir, in our opinion at PVA--and we have 
done considerable thinking about this. As you know, many 
veterans that are returning from OEF and OIF that have been 
paralyzed, some are able to transition to noninstitutional home 
and community-based programs fairly well. And I think VA will 
obviously be doing a good job in trying to make sure that those 
programs fit the needs of a younger population.
    It seems to me the greater challenge is how to carve out a 
niche in VA institutional programming, nursing home type care 
that is going to meet the needs of these individuals. I mean, 
as you stated and our testimony talks about institutional care 
is basically built around an aging veteran population and how 
to try to meet the needs of a younger veteran population and 
co-mix those two age groups is going to be a difficult 
challenge. And I am glad to hear that the Committee is thinking 
about that problem and I am sure VA as well.
    We just think that they really need to enlighten their 
staff. I know VA has been doing a lot of work for culture 
change in the nursing home care program and I think they need 
to give added emphasis on the needs of younger veterans.
    Mr. Hare. Thank you.
    Mr. Atizado.
    Mr. Atizado. Yes, sir. I want to echo my colleague's 
statement with regards to finding age appropriate settings for 
our younger, more severely injured soldiers. There is one thing 
that I think we can be thankful about with this new population, 
is that they are most likely going to have a support network, 
whereas aging or older, elder veterans have a higher rate of 
dependency and nobody there to assist them with that.
    I would like to speak very briefly about--at least mention 
all inclusive and/or assisted living, which is probably a 
program--in fact, it was a pilot program in the Mill Bill and 
it had glowing remarks both for care and patient satisfaction. 
But for whatever reason, VA has decided to decline using those 
services. That might be also an avenue that we could look into 
as far as treating our newer veterans.
    Mr. Hare. Ms. Middleton.
    Ms. Middleton. In addition to what they have said, I would 
think that it also would be important to--as the patients, the 
newer, the younger veterans are at the long-term care 
facilities, to see, ask them what they feel should be changed. 
Because their impression, their perception of their place in 
the facility is also important. So to ask them what kind of 
things they feel should be changed and how they can be more 
integrated with the things that are going on, what kind of 
needs they feel should be addressed would be important also.
    Mr. Hare. Okay. Thank you very much.
    I yield back.
    Mr. Michaud. Thank you very much. Once again, I would like 
to thank the three panelists for your enlightening testimony 
today. I look forward to our continuing to work together as we 
look at what we can do to help our veterans as they access 
long-term care needs. So once again, I thank all three of you 
very much.
    And while the third and final panel is coming forward, we 
have Patricia Vandenberg who is the Assistant Deputy Under 
Secretary for Policy and Planning from the Veterans Health 
Administration. And she is accompanied by Dr. James Burris who 
is the Chief Consultant for Geriatric and Extended Care for the 
VHA. So I want to welcome you hear today and look forward to 
hearing your testimony.

 STATEMENT OF PATRICIA VANDENBERG, MHA, BSN, ASSISTANT DEPUTY 
UNDER SECRETARY FOR HEALTH POLICY AND PLANNING, VETERANS HEALTH 
ADMINISTRATION, U.S. DEPARTMENT OF VETERANS AFFAIRS; AND JAMES 
  F. BURRIS, M.D., CHIEF CONSULTANT, GERIATRICS AND EXTENDED 
   CARE, VETERANS HEALTH ADMINISTRATION, U.S. DEPARTMENT OF 
                        VETERANS AFFAIRS

    Ms. Vandenberg. Thank you, Mr. Chairman and Members of the 
Subcommittee. I am very pleased to be here today accompanied by 
Dr. Jim Burris, our Chief Consultant in Geriatrics and Extended 
Care.
    Mr. Chairman, I want to begin by thanking you for your 
recognition in your opening comments regarding the role that VA 
plays in being a model in long-term care. My 40 years of 
experience in healthcare, the majority of it in the private 
sector, have given me broad exposure to what is happening in 
the field of long-term care and I am very pleased with what we 
will talking about today in terms of VA's approach to long-term 
care.
    Our philosophy is to provide patient-centered long-term 
care services in the least restrictive setting that is suitable 
for a veteran's medical condition and personal circumstances, 
and wherever possible in a home and community-based setting. 
Nursing home care should be reserved for situations in which 
the veteran can no longer be safely maintained in the home or 
community.
    VA expects to meet the growing need for long-term care 
through such innovative services as Care Coordination and Home 
Telehealth. VA's Care Coordination involves the use of health 
informatics, telehealth and disease management technologies to 
enhance and extend existing care. Care Coordination enables 
appropriate veteran patients with chronic conditions such as 
diabetes and congestive heart failure to remain in their own 
homes and defers the need for institutional care for as long as 
possible. This technology enables us to deliver care to 
veterans living remotely from VA facilities, including those in 
rural communities.
    Inevitably, veterans will require nursing home care and VA 
will continue to provide nursing home care for all veterans for 
whom such care is mandated by statute and who seek that care 
from us. VA will also continue to provide nursing home care for 
veterans with special needs, including those with spinal cord 
injury, ventilator dependence, or serious chronic mental 
illness.
    Transforming the culture of care in nursing homes from the 
traditional medical model to a more home-like patient-centered 
model is an imperative and we are pursuing this very actively. 
Recently, VA has also begun to care for younger veterans who 
have sustained polytraumatic injuries during their service in 
Enduring Freedom and Iraqi Freedom. But I have to note that 
this is not the first time that we have cared for young 
veterans. We have a history of caring for them for a number of 
years.
    While the number of these seriously disabled OIF/OEF 
veterans is relatively small, the complexity of care they 
require is higher and their personal and social needs do differ 
from those of older veterans. VA is moving to adapt its long-
term care services to meet the needs of these veterans.
    VA is taking steps, first, to recognize the generational 
differences of this population and to incorporate appropriate 
changes into our care routines. For example, in VA nursing 
homes, transforming the culture of care to make the living 
space more home-like and friendly is an imperative, as is 
having resources such as an Internet cafe computer games or 
age-appropriate music and food. Allowing for family, and 
especially children to visit or perhaps stay overnight is 
another example of the accommodation that we are already making 
to generational differences.
    In addition to VA nursing homes, VA supports the State 
Veteran Home Program with the provision of grants for 
construction and renovation and through per diem payments. 
Moreover, VA provides oversight to these homes. VA has 
developed a system of on-site inspections to assure quality of 
care in State Veteran Homes, including the identification of 
life safety issues.
    In compliance with Public Law 109-461, VA is currently in 
the process of developing regulations to implement the 
provisions of this law. VA takes great pride in our 
accomplishments thus far and looks forward to working with the 
members of this Subcommittee to continue the Department's 
tradition of providing high quality care to those who have 
helped defend our Nation around the world.
    This completes my oral statement and I look forward to your 
questions.
    [The prepared statement of Ms. Vandenberg appears on p. 
52.]
    Mr. Michaud. Thank you very much, Ms. Vandenberg. I really 
appreciate your coming here today. Actually, I have several 
questions that relate to a lot of the comments that were made 
from our previous two panels.
    The first one is the co-payment for hospice. What is the 
total amount of revenue that the VA brings in for that co-
payment?
    Ms. Vandenberg. I will have to defer to Dr. Burris on that 
topic.
    Dr. Burris. Actually, I don't have a number. We will have 
to get back to you, sir, for the record.
    [The following was subsequently received:]

          Deliverable 1: What is the amount of revenue VA received from 
        hospice co payment?

          Response: VA tracks co-payment amounts for inpatient services 
        and outpatient services collectively rather than by individual 
        services, so it is difficult to determine the exact amount of 
        revenue VA received from hospice co-payments. However, VA 
        estimated a total of $343,542 in annual revenue ($183,180 for 
        home hospice and $160,362 for inpatient hospice, calculated at 
        FY2006 rates).

    Mr. Michaud. Okay. The DAV commented about the end-of-life 
program at many VA facilities, and that some have been 
aggressively established. But there are some that have been 
lagging behind. Do you have any idea who is lagging behind?
    Ms. Vandenberg. I can't tell you that. We can certainly 
provide that information for the record. I think I can say with 
personal conviction that this is a facet of our care continuum 
that I have been very actively promoting with my colleagues and 
I think it is one that we believe deeply and philosophically. 
And so, what creates inertia in some environments to move in 
that direction is something that we continue to look at. But we 
will supply that information for the record.
    [The following was subsequently received:]

          Deliverable 2: Which VA facilities offer Hospice and End of 
        Life Care? Which do not--why are they lagging?

          Response: In FY2006, every VA facility offered some form of 
        hospice and end of life care service, while a recent survey 
        found that only one-fourth of other US hospitals had a 
        palliative care program. The VA's Hospice and Palliative Care 
        program has transformed much of the end of life care provided 
        or purchased by VA which has resulted in the following:

          a.  In FY2006, of all veterans who died in a VA facility, 42 
        percent received prior consultation from a palliative care team 
        (up from 30 percent in FY2003).
          b.  The number of palliative care consults in our VA 
        hospitals more than doubled between FY2003 and FY2006 and 
        surpassed 20,000 this past year.
          c.  The number of veterans receiving VA-paid home hospice 
        care tripled between FY2003 and FY2005, and has increased 
        another 30 percent in the past fiscal year (to an average daily 
        census of 427 veterans for FY2006).

          While this growth provides evidence of VA's leadership as a 
        healthcare system in the provision of end of life care, we 
        recognize there are some areas in which utilization of hospice 
        and end of life services is absent or low. Often the low 
        utilization appears to be related to regional and cultural 
        variations in the desire for hospice services. Overall, 
        Veterans Integrated Service Networks (VISNs) 1,2,3,12, and 19 
        report lower levels of VA-paid home hospice care than other 
        VISNs. While a number of individual facilities report little or 
        no VA-paid home hospice census such as the VA Medical Centers 
        in Albany and Northport, New York; Chicago; Dallas; Nashville; 
        Providence, RI; Salt Lake City; San Diego; and Shreveport, LA 
        these facilities have active palliative care programs within 
        their medical centers and make numerous referrals for hospice 
        care in the community, though not at VA expense.
          To promote and honor veterans' preferences for remaining in 
        their homes at the end of life, VA has established minimum 
        levels of VA-paid home hospice as a VISN Directors Performance 
        Measure. Additionally, VA tracks both home hospice and 
        inpatient palliative care activity and is working with VISNs 
        and facilities to assure reliable access to quality end of life 
        care in all settings at every VA facility. To promote reliable 
        access the following national conferences are planned for this 
        year:

          a.  A senior leadership conference of Network Directors on 
        July 17th to develop action plans to disseminate ``best 
        practices'' in end of life care
          b.  A national conference of acute care, home care and 
        hospice/palliative care staff on integrating palliative care 
        across VA will be held July 24th to 26th

    Mr. Michaud. Since you feel so deeply about this and we 
heard a number earlier about the co-payments. You know, it is 
end of life and why would we be charging any veteran co-
payments?
    Ms. Vandenberg. Sir, I think that is a very relevant 
question and one that I can take back and take under 
advisement.
    [The following was subsequently received:]

          Deliverable 3: Why does VA charge veterans a hospice co-
        payment?

          Response: Public Law 106-117, the Veterans Millennium 
        Healthcare and Benefits Act 1999, requires that non-service-
        connected veterans receiving extended care services from VA pay 
        a co-payment to the United States. Inpatient and home hospice 
        services are among the services subject to a mandatory co-
        payment, with the exception of hospice services provided in a 
        nursing home.

    Mr. Michaud. Okay. Thank you. We heard from the State Homes 
about VA regulations versus the CMS and that CMS is more 
stringent. Have you looked at this issue? And if CMS is more 
stringent, would you consider adopting the CMS regulations if 
appropriate?
    Ms. Vandenberg. Sir, I think our regulations are fairly 
consistent. Perhaps one difference in the application of the 
regulations is the way the survey process is conducted. And we 
will certainly take the comments that were made by our 
colleagues today under advisement in terms of the rigor of the 
survey process.
    Mr. Michaud. And if you could provide the Committee with 
what the differences between the two, I would be really 
interested.
    Ms. Vandenberg. I would be happy to do a side by side 
comparison.
    [The following was subsequently received:]

          Deliverable 4: Side by Side comparison of Center Medicare 
        Services (CMS) and VA regulations for State Homes--Which is 
        more stringent--Why not adopt one?

          Response: The CMS standards are a generic set of national 
        standards that are required to be met for all nursing homes in 
        the United States that are certified under Medicare and 
        Medicaid. They are used to determine continued eligibility for 
        reimbursement and to assure the public that a nursing home 
        meets at least the minimum standards for quality of care.

          Each State is required to apply these standards but may in 
        fact add requirements that are more stringent. The standard 
        that applies is whichever--State or national--is the most 
        stringent. For example, CMS standards do not address a specific 
        nurse staffing requirement. The CMS standard states that 
        staffing must be adequate. On the other hand States specify 
        nursing hours per patient day that range in some states from 
        2.0 hours per patient day to 3.35 hours per patient day.
          VA standards are based on the CMS standards but because the 
        reimbursement framework and some other requirements are VA 
        specific, the VA standards also address VA specific 
        requirements.
          The following are similarities and significant areas of 
        difference between the VA and CMS national standards:
          Similarities: In general, the basic clinical standards are 
        similar for both organizations. There are nuances regarding in 
        how they are written. Both sets of standards, because they are 
        essentially the same in regard to resident care, are equally 
        stringent. Both organizations are currently updating their 
        requirements for Life Safety and intend to deploy the 2006 
        standards.
          Differences: Areas of clear differences are primarily in the 
        responsibilities of the homes in regard to payment oversight 
        and processes and other system related requirements that 
        differentiate the payment sources and mechanisms. These are VA 
        Per Diem requirements versus Medicare/Medicaid requirements; 
        oversight responsibilities as they relate to the payers; and an 
        occasional technical difference. These differences will be 
        pointed out more specifically below where a standard is present 
        in one system but not the other.

    Standards Unique to VA

      Notification of the Office of Geriatrics and Extended 
Care regarding changes in SVH administration is required.
      Specification of the percentage of veterans that must 
occupy the SVH
      Requirements for management of a SVH by a contractor
      Credentialing and privileging of the Medical Director
      Monthly required submission to VA of a request for per 
diem payment
      Requirements for nursing home with 100 or more beds to 
have a qualified social worker
      Requirement for RN staffing 24 hours per day 7 days per 
week
      Nurse staffing requirement of 2.5 hours per patient day 
for all State homes
      Specific requirements for reporting and following up on 
sentinel events including conducting a root cause analysis
      Specific bed hold and transfer policy
      A set of comprehensive standards around the SVH 
recognition process for new construction and/or renovation
      Standards for withholding per diem

    Standards Unique to CMS

      Definition of skilled nursing
      Requirement to inform residents about Medicare and 
Medicaid eligibility and responsibility for certain charges
      Instructions regarding public display of information 
about how to apply for Medicare or Medicaid benefits
      Notification of the amount of money in a resident's 
account for SSI limits
      Limitations on charges to personal funds for Medicare and 
Medicaid covered services
      Admission requirements and Medicare and Medicaid 
eligibility
      Prescriptive detail about requirements for activities 
programming
      Automated data processing and transmission requirements 
for the Minimum Data Set (MDS)
      Penalties for falsification of data
      Preadmission Screening for Mentally III and Individuals 
with Mental Retardation
      Requirements for influenza and pneumococcal vaccine
      Disclosure of ownership requirements

    Summary and Conclusions:

          Although the clinical standards are essentially the same, the 
        standards regarding admission, payment, transmission of data, 
        ownership, and Medicaid and Medicare requirements differ 
        because of the significantly different payment mechanisms, 
        requirements for recognition, and accountability.
          Another important distinction between the two sets of 
        standards is that the CMS standards are overarching but defer 
        to individual States for definition in a number of areas 
        including but not limited to nurse staffing, bed hold days, and 
        follow up on sentinel events so that the most stringent 
        standard would prevail.
          Finally, an important variation in the CMS approach is the 
        nature of the interpretive guidelines and the survey process 
        itself. CMS' interpretive guidelines are more prescriptive and 
        provide more specific guidance than VA's. The CMS survey 
        process is very clearly defined including the application of 
        survey findings to a grid that distinguishes serious findings 
        and proposes a solution ranging from a mere recommendation to 
        serious monetary penalties and sanctions until findings are 
        improved. VA intends to rewrite its own interpretive guidelines 
        to provide clearer and more precise guidance for application of 
        the VA standards.
          VA will continue to utilize the current VA standards for 
        survey of SVH. The current approach allows for application of 
        the VA standards from the VA perspective as a payer for 
        services and allows for one standard approach for all State 
        Veterans Homes. Adoption of the CMS standards would introduce 
        State-to-State variation in standards that is undesirable for 
        the VA's integrated healthcare system approach to care. Some 
        State requirements could be less than what VA would consider 
        acceptable. In addition, since only approximately 40 percent of 
        State Veterans Homes are CMS certified, VA would still be 
        required to maintain its own national standards for the 
        remaining 60 percent.

    Mr. Michaud. Yes. The other issue, and if you could provide 
for the Committee--I know there is a priority list when you 
look at the State Homes. I believe it is $250 million, I think, 
is the backlog for priority ones. Could you provide the 
Committee with the priority one projects out there and the 
cost, as well as how many priorities you have?
    Ms. Vandenberg. Dr. Burris, could you please respond to 
that?
    Dr. Burris. Yes. There are seven priorities and the 
priority group one projects are those for which, as you have 
already heard, the States have committed their share of the 
funding, so that when VA is able to offer a grant, the State is 
able to proceed.
    Mr. Michaud. Okay. Could you provide the Committee with the 
different priority lists that you have available?
    Ms. Vandenberg. Yes, sir. We will provide that for the 
record.
    [The following was subsequently received:]

          Deliverable 5: List of different priorities for SVS Program.

          Response: Priority Group Definitions for the Priority List

          Priority Group 1. An application from a State that has 
        certified Sate matching funds for the project.

          Priority Group 1--Subpriority 1. A project to remedy 
        conditions at an existing facility that have been cited as 
        threatening to the lives or safety of the residents.

          Priority Group 1--Subpriority 2. An application from a State 
        that has not previously applied for a grant under 38 U.S.C. 
        8131-8137. Great Need: If State has no State homes beds.
          Priority Group 1--Subpriority 3. An application from a State 
        that has a great need for the beds. Great Need: If State has an 
        unmet need of 2,000 or more beds.
          Priority Group 1--Subpriority 4. An application from a State 
        for renovations not included in Subpriority 1 of Priority Group 
        1.
          Priority Group 1--Subpriority 5. An application from a State 
        that has a significant need for the beds.
          Significant Need: If State has an unmet need of 1,000 to 
        1,999 beds.
          Priority Group 1--Subpriority 6. An application for 
        construction or acquisition of a nursing home or domiciliary 
        from a State that has a limited need for the beds that the 
        State, in that application, proposes to establish. Limited 
        Need: If State has an unmet need of 999 or fewer beds.

          Priority Groups 2 through 7. Applications from a State that 
        does not have certified State matching funds for the project. 
        Ranked same as Priority Group 1

          Priority Group 2--Subpriority 1. A project to remedy 
        conditions at an existing facility that have been cited as 
        threatening to the lives or safety of the residents.
          Priority Group 3--Subpriority 2. An application from a State 
        that has not previously applied for a grant under 38 U.S.C. 
        8131-8137. Great Need: If State has no State homes beds.
          Priority Group 4--Subpriority 3. An application from a State 
        that has a great need for the beds. Great Need: If State has an 
        unmet need of 2,000 or more beds.
          Priority Group 5--Subpriority 4. An application from a State 
        for renovations not included in Subpriority 1 of Priority Group 
        1.
          Priority Group 6--Subpriority 5. An application for 
        construction or acquisition of a nursing home or domiciliary 
        from a State that has a significant need for the beds that the 
        State, in that application, proposes to establish. Significant 
        need if State has an unmet need of 1,000 to 1,999 beds. 
        Priority Group 7--Subpriority 6. An application for 
        construction or acquisition of a nursing home or domiciliary 
        from a State that has a limited need for the beds that the 
        State, in that application, proposes to establish. Limited 
        Need: If State has an unmet need of 999 or fewer beds.


        [GRAPHIC NOT AVAILABLE IN TIFF FORMAT]


    Mr. Michaud. Okay. You have heard from the State Homes in 
Maine and I don't know if you had a chance to look at the 
testimony of Mr. Nagel, but in the back it showed a veterans 
complex that they are looking at doing in the State of Maine 
that has hospice and the State Home, and is a nice complex. 
Have you any initial thoughts on that concept, whether it is a 
good idea?
    Ms. Vandenberg. Well, I think when you look at the vision 
that we have in the VHA of providing patient-centered, 
integrated care, on the face of it, that concept makes a great 
deal of sense, that we would aggregate resources and have them 
be as patient-centered and as integrated as we possibly could.
    I didn't have a chance to look at it from a policy 
standpoint prior to the hearing, but we will certainly review 
that.
    Mr. Michaud. Okay. Great. We also heard from the previous 
panels concerning waiting lists, whether it is trying to get 
into the VA system or a State veterans nursing home. How big of 
a waiting list is there for veterans who are trying to get into 
a home?
    Ms. Vandenberg. I would like to have Dr. Burris respond to 
that question.
    Dr. Burris. As far as we are aware, there is no waiting 
list in the VA system for the category P-1-A veterans for whom 
nursing home care is mandatory. We don't maintain information 
about waiting lists in the State Homes. They really are owned, 
operated and managed by the States. But the State Veterans Home 
organization has surveyed their members and I believe the 
figure that was cited earlier in testimony was about 10,000.
    Mr. Michaud. Okay. I don't know if you have microphones on 
or if you can pull it a little bit closer. If there is no 
waiting list, is there a surplus of beds? And if so, how many?
    Dr. Burris. No, we don't feel there is a surplus. The 
average daily census of a little over 11,000 that we have 
currently represents the demand for both long-term residential 
care and for short-term care for post-acute care for patients 
who had had a stroke or an operation, a broken hip, a serious 
infection and need a period of restorative care or 
rehabilitation before they can be discharged back into the 
community.
    Mr. Michaud. You heard from PVA earlier that there is a 
waiting list, in some cases a year, to try to get into--was it 
the four facilities?
    Dr. Burris. Yes. That is something that VA has recognized 
and there are four new centers that are under development. But 
that is something that VA works very closely with PVA to 
monitor the demand for care.
    Mr. Michaud. And when will the VA be able to eliminate that 
waiting list? Particularly when you look at what is happening 
with the war in Iraq and Afghanistan, I think we are going to 
see a higher need, unfortunately, in that particular area. So 
when is that waiting list going to be gone?
    Dr. Burris. It is a little bit hard to predict. It is a 
moving target because there are new patients coming into the 
system all the time. I actually would have to defer to Dr. 
Margaret Hammond who directs that program for a definitive 
response.
    Mr. Michaud. And could you provide us with what the waiting 
list is at each of those four facilities?
    Dr. Burris. Yes, sir.
    [The following was subsequently received:]

          Deliverable 6:

          a.  What are the waiting times at the 4 SCI centers (PVA 
        asserted it was up to a year)?

        Response:

          Boston: 10 patients with waiting range from July 2005 
        to April 2007.
          Hampton: 12 patients with waiting range from 
        September 2005 to March 2007.
          Castle Point: No wait list. Hines: 6 patients with 
        waiting range from January 2007 to April 2007.

          b.  What is VA's timeline to eliminate the waiting list for 
        the 4 SCI Centers?

        Response: Implementation of the CARES Planning Initiatives will 
        be used to increase geographic access to SCI LTC services. The 
        timeline is dependent upon completion of the Tampa beds for 
        which construction has begun, and the implementation of LTC 
        beds at Cleveland, Long Beach and Memphis which are in planning 
        or design phases.

        Access to non-institutionalized extended care services is being 
        encouraged under the Uniform Benefits Package.

      c.  What is VA's estimate of the future need for inpatient beds 
for SCI patients (PVA cited CARES data projecting an SCI/D long-term 
care bed gap of 705 beds in 2021 and 1,358 beds in 2022)?

          Response: The CARES spinal cord injury planning model for 
        institutional care projected a demand for 1,388 available beds 
        in FY2012 and for 1,575 beds in FY2022. Using existing workload 
        data, the demand was met, in part, by SCI long term care center 
        beds, by the average daily census of veterans with SCI in VA 
        nursing home care units, in contract nursing homes, and other 
        VA LTC settings. The model provided the basis for 
        recommendations approved by the Secretary for 30 SCI LTC beds 
        at Tampa, 20 at Memphis, 20 at Cleveland, and 30 at Long Beach.

          Subsequently in 2004, VA was requested to revalidate the 
        original 2001 SCI LTC planning model using a revised approach. 
        This tentative model supported the original CARES 
        recommendations to enhance access. This model projected a 
        demand for 1,969 available beds in FY2012 and 2,622 beds in 
        FY2022 for a 100 percent market share of veterans with SCI in 
        priority group 1 a. Utilization data and inclusion of the CARES 
        recommendations resulted in a projected gap of 705 as recently 
        reported by PV A. Incorporating 2006 workload data of 154 SCI 
        long term care beds, an average daily census of 905 in VA 
        Nursing Home Care Unit, 293 in contract care, 42 in other VA 
        LTC settings, and with full implementation of the CARES 
        recommendations, there is a projected gap of 475 in FY 2012. 
        Internal discussion and planning are needed to address this 
        projected gap.

    Mr. Michaud. And what would the VA estimate the future need 
will be, particularly when you look at what is happening with 
the war in Iraq and Afghanistan?
    [The Priority List of Pending State Home Construction Grant 
Applications for FY 2007 appears on p. 60.]
    My last question--I know I have run over time. But in the 
closing remarks of the DAV, they talked about the lack of a 
strategic plan that involves stakeholders input. It is 
discouraging to DAV and others in this community. I have always 
been one who will try to bring in--if you are trying to solve a 
problem, you bring in those who are really affected by it. 
Whether you agree or disagree, at least it gives you a broad 
perspective of what is going on.
    What is VA doing to--when you look at these strategic 
plans, to bring in those who are going to be using the 
facilities?
    Ms. Vandenberg. I will refer to Dr. Burris who has had the 
lead in the formulation of the strategic plan.
    Dr. Burris. Well, first of all, I would say that the long-
term care strategic planning is part, really an integral part 
of the broader VA and VHA strategic planning. It is not a free-
standing event. And so what we have done is to pull together 
the elements of those larger strategic plans, VA and VHA, that 
reflect long-term care needs and are developing a report for 
Congress as required by the law.
    Public Law 109-461 provided really a very short turnaround 
time for this so that we haven't had a very extensive planning 
process as we did in the report that followed the Millennium 
Act. But we do consult with the stakeholders. The veterans 
service organizations, for example, are represented on our 
Geriatrics and Gerontology Advisory Committee, which is a 
Federal advisory Committee of folks external to VA. It meets 
twice a year. It just met last month here in Washington and we 
really had very extensive discussion with the Advisory 
Committee about where our long-term care programs are going.
    We also consult regularly with the State Veterans Homes 
organizations, both the National Association of State Directors 
of Veterans Affairs and the National Association of State 
Veterans Homes. There is a liaison Committee that meets 
formally twice a year and we have informal communications 
throughout the year.
    So we do make an effort to get input from stakeholders and 
those we collaborate with in providing care to veterans.
    Mr. Michaud. Well, I would strongly encourage you to make 
sure that that input is taken in and taken seriously, because I 
feel--even though it might add a little extra time or energy, I 
feel very strongly that the more people you get involved in the 
process hearing their input, the better product that you will 
have in the end. And hopefully, it will definitely bring a lot 
more support for whatever programs that the VA brings forward 
to dealing with our veterans.
    Mr. Hare.
    Mr. Hare. Thank you, Mr. Chairman. I had a whole list of 
questions and you asked them all but one.
    And again, I appreciate your taking the time to come this 
morning. Real time health information is critical to providing 
high quality healthcare. And the VA currently has the best 
electronic medical records available. Has there been any 
consideration given to sharing those electronic medical records 
with the State Veterans Homes? If not, could you tell me if 
that something that you might consider doing?
    Ms. Vandenberg. We have had extensive internal 
conversations regarding the parameters that we have to operate 
within in order to maintain patient privacy. And so the actual 
electronic medical record software is available in the public 
domain and we have talked to the State Veteran Home 
representatives about how we could collaborate with them using 
that tool. Direct interoperability does not seem to be legally 
feasible at this time given the parameters of the privacy laws 
that we operate under.
    Mr. Hare. Okay. Thank you very much.
    I yield back, Mr. Chairman. Thank you for this important 
hearing this morning.
    Mr. Michaud. Thank you very much, Mr. Hare. And thank you 
for your advocacy for our veterans.
    For those of you who don't know, Congressman Hare is a 
former staffer of the Ranking Member of this Committee for a 
number of years, Lane Evans. And he definitely has taken on 
where Mr. Evans has left off in dealing with veterans' issues.
    Mr. Brown, unfortunately, had another commitment so he was 
unable to stay, but I would ask counsel if he has any 
questions.
    Mr. Tucker. Yes. I actually have a couple of questions. And 
it is always good to see a staffer do well there, Mr. Hare.
    A question for Dr. Burris and a question for Ms. 
Vandenberg.
    Dr. Burris, you state that the 11,000 average daily census 
which you are currently estimating for FY 2008 does not provide 
any surplus and it does not give you any problems with a 
waiting list. If 2,391 nursing home beds suddenly appeared 
across the country, would you be able to find veterans to fill 
those beds?
    Dr. Burris. We might be able to find people to put in the 
beds, yes. One of the problems we were having, though, with the 
13,391 requirement was that our medical centers were having 
trouble finding appropriate patients to admit to the nursing 
home, who met the eligibility requirements for that level of 
care. So I think we would have difficulty filling those beds, 
frankly.
    Mr. Tucker. And Ms. Vandenberg, VA spends approximately 90 
percent of its long-term care budget on institutional care. For 
Medicaid, it is nearly 60 percent. Do you believe this 
differential is due to the unique qualities of the veterans' 
population, that you are going to always have to have more 
institutional care than noninstitutional care?
    Ms. Vandenberg. Well, I think that as was evidenced in some 
of the prior comments, what contributes to the cost in our 
facilities is a function of the complexity of the care that we 
are providing. And so when we look at the funds that are 
allocated for institutional care, that complexity is reflected 
in that. If the question underlying your question is are we 
devoting sufficient funds to promote the noninstitutional care, 
at this point in time we believe we are making steady progress 
in reaching our targets for noninstitutional care and we are 
constantly monitoring that. Does that respond to the question?
    Mr. Tucker. Yes. I think we are getting to a point where 
the VA needs to provide more home and community-based care and 
I think our concern up here is that those funds should not just 
be shifted from institutional care to noninstitutional 
programs, that we actually grow the home and community-based 
funding streams and programs, as well as maintain a capacity 
and a capability of providing nursing home care.
    Ms. Vandenberg. Thank you.
    Mr. Tucker. Okay. Thank you.
    Mr. Michaud. Once again, I would like to thank this panel 
and the previous two panels for your coming here this morning. 
I enjoyed the testimony and look forward to working with all of 
you as we move forward dealing with this very important issue 
of long-term care for our veterans. So once again, thank you 
very much.
    Ms. Vandenberg. Thank you, sir.
    Mr. Michaud. The hearing is adjourned.
    [Whereupon, at 11:30 a.m., the Subcommittee was adjourned.]











                            A P P E N D I X

                              ----------                              

             Prepared Statement of Hon. Michael H. Michaud
                    Chairman, Subcommittee on Health
    I would like to thank everyone for coming today.
    This morning, the Subcommittee on Health will examine the state of 
VA's long-term care programs and services.
    In terms of demographics, the veteran population is aging and will 
require a greater amount of long-term care services. Out of a veteran 
population in this country of 25 million, nearly 45 percent are over 
the age of 65, and the number over the age of 85 is expected to reach 
1.3 million by 2010.
    In addition, the veteran population is poorer, sicker and older 
than their non-veteran counterparts.
    The VA will also be facing an entirely new generation of veterans 
in need of long-term care services--some of our wounded returning OEF/
OIF veterans, who have different needs than those of our older 
veterans.
    Medicaid is the principal financer of long-term care. In 2004, 
Medicaid spent $90 billion on long-term care services, of which $57.6 
billion, or 64 percent, was for institutional care.
    The VA has requested $4.6 billion for long-term care services in FY 
2008. Nearly 90 percent is for institutional care.
    The VA must, in my view, maintain its nursing home capacity while 
vigorously expanding its non-institutional care capabilities.
    Contrary to the plain evidence of an increasing long-term care 
demand, this year the VA will again ignore its clear legal 
responsibility to maintain its nursing home bed capacity. The VA's FY 
2008 budget estimates a further drop in the average daily census to 
11,000, nearly 20 percent below the required level.
    I am concerned that VA is not doing enough to maintain its nursing 
home capacity, while not moving fast enough to provide more home and 
community-based care.
    An integral component to VA's institutional care services is The 
State Veterans Home Program. Currently, State Veterans Homes handle 
over 50 percent of the VA's overall patient work load in nursing homes.
    I believe we must maximize this existing resource as well as other 
resources within our communities to ensure the best possible care for 
our veterans.
    The VA has a long history of providing long-term care services, and 
I believe that the VA has many lessons it can teach other areas of the 
Federal Government, and the private sector, on how best to provide 
these services. The VA can indeed be a long-term care model for others.
    VA continues to have an obligation to meet the long-term care needs 
of our veterans. I look forward to hearing from our witnesses as to how 
VA should meet this obligation in the future.

                                 
             Prepared Statement of Hon. Henry E. Brown, Jr.
    Thank you Mr. Chairman for holding this hearing to examine how the 
Department of Veterans of Affairs is providing a mix of extended care 
services and how VA intends to address the provision of long term care 
in the future.
    Today, one of the biggest challenges in both VA and the private 
sector healthcare systems is providing long-term care to a growing 
aging population. This challenge is amplified for VA, which must 
facilitate care for the special needs of our disabled and aging 
veterans. The Department is also facing an emerging new need to care 
for seriously injured younger veterans returning from the Global War on 
Terror.
    I appreciate that at our hearing today we have witnesses 
representing the State Veterans Homes. On Veterans Day last year, I had 
the privilege of dedicating a new State Veterans Home in Walterboro, 
South Carolina. This 220 bed facility, the Veterans' Victory House, is 
one of the most modern of its kind in the United States, and includes a 
52 bed secured dementia unit.
    In partnership with the VA, State veterans' homes can help provide 
a broad range of services to meet the long-term care needs of our 
veterans. Last year, with the enactment of Public Law 109-461, the 
Veterans Benefits, Healthcare, and Information Technology Act of 2006, 
Congress expanded the authorities for State veterans' homes. The law 
requires VA to reimburse State veterans' homes for the full cost of 
care for a veteran with a 70 percent or greater service-connected 
disability rating and in need of care for service-connected conditions. 
It also ensures that veterans with a 50 percent or greater service-
connected disability receive, at no cost, medications they need through 
VA.
    Additionally, Public Law 109-461, requires VA to publish a 
strategic plan for long-term care. Hopefully, this plan that has been a 
long time in coming will provide a clear map of the Department's future 
plans for delivering long term care for those veterans who rely on VA 
to provide these services. I look forward to the delivery of this plan 
as required by law. We have allowed VA to drag its feet on this issue 
for far too long.
    Mr. Chairman, we need to remember that the quality in which we 
provide long-term care is a reflection on how this country honors the 
sacrifices of our Nation's veterans.
    I look forward to our discussion today and to explore innovative 
steps we can take to provide the best patient-centered care to enhance 
the quality of life of veterans in need of long-term care services. 
Knowing what a busy day today is, I yield back

                                 
    Prepared Statement of Raymond A. Nagel, Chief Executive Officer
                   Main Veterans' Homes, Augusta, ME
    Mr. Chairman and Members of the Committee, thank you for the 
opportunity to testify today on behalf of the Maine Veterans' Homes 
(``MVH'') on the topic of ``The State of VA's Long-Term Care Program: 
Present and Future,'' including the important issue of access by rural 
veterans to quality long-term nursing care.
    I am the Chief Executive Officer of MVH. I have 23 years of 
healthcare management experience including 19 years of experience as a 
Medical Services Officer within the United States Army and the United 
States Army Reserves. I am a combat veteran of Operations Desert Shield 
and Desert Storm. I recently retired from the U.S. Army Reserves as a 
Lieutenant Colonel and commander of a 296-bed Combat Support Hospital. 
I have been the chief executive officer of the Maine Veterans' Homes 
for nearly 1 year.
    MVH is a public body corporate created by the State of Maine to 
provide long-term nursing care to Maine veterans. MVH operates six 
long-term nursing care facilities for veterans at Augusta, Bangor, 
Caribou, Machias, Scarborough, and South Paris. In the aggregate, MVH 
currently operates 640 skilled nursing, long-term nursing, and 
domiciliary beds for Maine veterans. This makes MVH one of the largest 
systems of long-term nursing facilities in the State of Maine, and we 
are very proud of the quality long-term care nursing services that we 
provide to Maine veterans.
    Also, as one of the largest and most successful State Veterans 
Homes systems in the nation, MVH provides a crucial portion of the 
healthcare continuum for Maine veterans. Our facilities are each 
relatively small in size, 30 to 150 beds each, and this allows them to 
be located not only at one or two locations, but throughout the State 
of Maine, allowing greater ease of access to our facilities by veterans 
living in the most rural parts of Maine. In the future, we hope to 
develop additional in-patient and out-patient services at all of our 
six locations in order to offer rural Maine veterans greater access to 
all of the services that the Maine Veterans' Homes, the Maine Bureau of 
Veterans Services, and the United States Department of Veterans Affairs 
(``VA'') provide.
    MVH is part of a national system of State Veterans Homes. The State 
Veterans Homes system is the largest provider of long-term care to our 
Nation's veterans. There are 126 veterans homes in all 50 States and 
the Commonwealth of Puerto Rico. Nursing home care is provided in 121 
homes, domiciliary care in 53 homes, and hospital care in 5 homes. 
These homes presently provide over28,000 resident beds for veterans of 
which almost 22,000 are nursing home beds. These beds represent about 
50 percent of the long-term care workload for the VA.
    The State Veterans Homes play an irreplaceable role in assuring 
that eligible veterans receive the benefits, services, and quality 
long-term healthcare that they have rightfully earned by their service 
and sacrifice to our country. We greatly appreciate the Veterans' 
Affairs Committee's commitment to the long-term care needs of veterans, 
your understanding of the indispensable function that State Veterans 
Homes perform, and your strong support for our programs. We especially 
appreciate the consistent support of the Veterans' Affairs Committee, 
working with the Appropriations Committee, to ensure that per diem 
payments by the VA will continue under current eligibility criteria.
    The Maine Veterans' Homes is a leader in the national system of 
State Veterans Homes and a leader in the National Association of State 
Veterans Homes (``NASVH''). The membership of NASVH consists of the 
administrators and staff of State-operated veterans homes throughout 
the United States. We work closely with the VA, State governments, the 
National Association of State Directors of Veterans Affairs, veterans 
service organizations, and other entities dedicated to the long-term 
healthcare of our veterans. Our goal is to ensure that the level of 
care and services provided by State Veterans Homes meet orexceed the 
highest standards available.
Role of the State Veterans Homes
    State Veterans Homes first began serving veterans after the Civil 
War. Faced with a large number of soldiers and sailors needing long-
term care, several States established veterans homes to care for those 
who had served in the military.
    In 1888, Congress first authorized Federal grants-in-aid to states 
that operated homes in which American soldiers and sailors received 
long-term care. At the time, such payments amounted to about 30 cents 
per resident per day. In the years since, Congress has made several 
revisions to the State Veterans Homes program to expand the base of 
payments to include nursing home, domiciliary, and adult day 
healthcare.
    For nearly half a century, State Veterans Homes have operated under 
a program administered by the VA which supports the Homes through 
construction grants and per diem payments. Both the VA construction 
grants and the VA per diem payments are essential components of this 
support. Each State Veterans Home must meet stringent VA-prescribed 
standards of care, which exceed standards mandated by Federal and State 
governments for other long-term care facilities. The VA conducts annual 
inspections to assure that these standards are met and to assure the 
proper disbursement of funds. Together, the VA and the State Veterans 
Homes represent a very effective and financially efficient Federal-
State partnership in the service of our Nations veterans.
    VA per diem payments to State Homes are authorized by 38 U.S.C. 
Sec. 1741-1743. The per diem payments are intended by Congress to 
assist the States in providing for the level of care and treatment 
required for eligible veterans residing in State Veterans Homes. As you 
know, the per diem rates are established by the VA annually and may not 
exceed 50 percent of the cost of care. They are currently $67.71 per 
day for nursing home care, $40.48 per day for adult day healthcare, and 
$30.31 per day for domiciliary care. Our State Veterans Homes cannot 
operate without receipt of per diem payments from the VA under current 
eligibility criteria.
    Construction grants are authorized by 38 U.S.C. Sec. Sec. 8131-
8137. The objective of such grants is to assist the States in 
constructing or acquiring State Veterans Home facilities. Construction 
grants are also utilized to renovate existing facilities and to assure 
continuing compliance with life safety and building codes. Construction 
grants made by the VA may not exceed 65 percent of the estimated cost 
of construction or renovation of facilities, including the provision of 
initial equipment for any project. State funding covers at least 35 
percent of the cost. Our program cannot meet our veterans' needs 
without an adequate level of construction grant funding.
    In recent years, State Veterans Homes have experienced a period of 
controlled growth in response to the increasing number of elderly 
veterans who require long-term healthcare. In fact, as a nation we face 
the largest aging veterans population in our history. By the end of 
this decade, the number of veterans aged 85 and older will have tripled 
from 422,000 to 1.3 million. If the State Veterans Homes program is to 
fill the need for additional long-term care beds required in certain 
States and to respond to the increase in the number of veterans 
eligible for long-term care nationally, it is critical that the State 
Veterans Home construction grant program be sustained at adequate 
levels.
    The State Veterans Home program now provides about 50 percent of 
the VA's total long-term care workload. The VA has estimated that 
nursing care beds in the State Veterans Homes nationwide are 87 percent 
occupied. The beds at our homes in Maine are approximately 96 percent 
occupied. Many of the State Veterans Homes nationally have occupancy 
rates near 100 percent, and some have long waiting lists. The State 
Veterans Homes provide long-term medical services to frail, elderly 
veterans at a cost to the VA of less than $68 per day, well below the 
cost of care in a VA nursing home, which is over $560 per day.
    Although there are no national admission requirements for the State 
Veterans Homes, there are State-by-State medical requirements for 
admission to such homes. Generally, a State will require a medical 
certification confirming several significant deficits in activities of 
daily living (an assessment of basic living functions) that together 
require 24-hour nursing care. Moreover, no per diem is paid by the VA 
unless and until a VA official certifies that nursing home care is 
required. Veterans qualifying for long-term nursing care at a State 
Veterans Home are almost always very ill and elderly, and many are 
afflicted with mental health conditions.
State Veterans Homes as a VA Resource
    The Veterans' Millennium Healthcare Act (``Mill Bill''), Pub. L. 
No. 106-117, enacted significant changes to veterans' long-term 
healthcare. Significantly, the VA is directed to provide long-term care 
for all veterans who have a 70 percent or greater service-connected 
disability or who need nursing care for a service-connected disability. 
The State Veterans Homes should play a major role in meeting these 
requirements and be treated as a resource that is integrated much more 
fully with the VA's own long-term care program.
    The State Veterans Homes have proposed that our beds be counted 
toward the VA's overall long-term care census. Doing so would allow the 
VA to meet the Mill Bill's long-term care bed requirements. A nursing 
home bed in a State Veterans Home is a very cost-effective alternative 
to a nursing home bed in a VA-operated facility. Congress's goal should 
be to provide long-term care to veterans in a manner that expands the 
VA's capacity to provide services, while paying the lowest available 
per capita cost for each eligible veteran. Including State Veterans 
Homes nursing beds in the mandated VA long-term care totals would allow 
the VA to meet its legislative mandate, shift some of its long-term 
care services to the State Veterans Homes, and ultimately increase the 
capacity of the VA to provide greater short-stay, highly specialized, 
post-acute rehabilitative care.
    This goal can be accomplished by the State Veterans Homes at 
substantially less cost to taxpayers than other alternatives. The 
average daily cost of care for a veteran at a long-term care facility 
run directly by the VA has been calculated nationally to be $563.45 per 
day. The cost of care to the VA for the placement of a veteran at a 
contract nursing home, which is not required to meet more stringent 
State Veterans Home standards, is approximately $225.30 per day. The 
same daily cost to the VA to provide quality long-term nursing care at 
a State Veterans Home is far less--only $67.71 per day.
    This substantially lower daily cost to the VA of the State Veterans 
Homes compared to other available long-term care alternatives led the 
VA Office of Inspector General to conclude in a 1999 report: ``the SVH 
[State Veterans Home] program provides an economical alternative to 
Contract Nursing Home (CNH) placements, and VAMC [VA Medical Center] 
Nursing Home Care Unit (NHCU) care'' (emphasis added). In this same 
report, the VA Office of Inspector General went on to say:
    A growing portion of the aging and infirm veteran population 
requires domiciliary and nursing home care. The SVH [State Veterans 
Home] option has become increasingly necessary in the era of VAMC [VA 
Medical Center] downsizing and the increasing need to discharge long-
term care patients to community based facilities. VA's contribution to 
SVH per diem rates, which does not exceed 50 percent of the cost to 
treat patients, is significantly less than the cost of care in VA and 
community facilities.
Innovative Programs at the State Veterans Homes
    Although several states have either a ``great'' or ``significant'' 
need, as defined by Federal law, to build new State Veterans Homes 
immediately, the State of Maine, with 640 beds already in successful 
operation, has built all of the long-term care beds for veterans that 
we expect to build. We are limited by Federal law to the 640 long-term 
care beds for veterans that we currently operate. Furthermore, the 
State of Maine operates our long-term care beds for veterans at over 96 
percent of capacity, and this is virtually full occupancy, since 
veterans continually are admitted to or discharged from the homes.
    If the State of Maine is to provide greater levels of services to 
its veterans, MVH must expand the types of services we offer to Maine 
veterans. Therefore, MVH has initiated an ambitious new program to 
expand the delivery of additional health-care related services at 
locations clustered around its existing State Veterans Homes.
    For example, at the 150-bed MVH nursing and domiciliary facility 
located at Bangor, Maine, MVH is proposing to construct an integrated 
``veterans campus'' containing an 18,500 square foot Community Based 
Outreach Clinic (``CBOC''), a seven-bed hospice facility, and an 18-
unit elderly veterans housing facility. Attached to my testimony are 
proposed site plans for this veterans' campus. The CBOC (to be operated 
by the VA) will provide primary healthcare to Maine veterans and house 
State offices providing veterans services. The hospice (to be operated 
by MVH) will provide critically needed end-of-life and palliative care 
services to Maine veterans. Finally, the elderly housing facility will 
provide short and long-term housing to Maine veterans who may be using 
the other health-related services provided at the veterans' campus.
    This veterans' campus can be constructed using solely the financial 
resources of MVH, and at no cost to Maine taxpayers. Later, if 
appropriate, the services provided at such a veterans campus could be 
expanded to include assisted living and congregate housing, adult 
daycare services, and home healthcare services for veterans. In this 
manner, MVH will provide, within an integrated setting, comprehensive 
healthcare services to Maine veterans covering the full continuum of 
care. Furthermore, this concept could be replicated at the sites of 
each of the other five existing MVH facilities, in order to provide 
veterans throughout the State of Maine with easy access to 
comprehensive healthcare in both urban and rural settings. Attached to 
my testimony is a map of the State of Maine showing the locations of 
all six existing MVH facilities. This concept, if successful in Maine, 
can be replicated elsewhere in the country.
Conclusion
    Mr. Chairman and Members of the Subcommittee, thank you for your 
commitment to quality long-term care for veterans and for your support 
of the State Veterans Home system as a central component of that care. 
We believe that the State Veterans Homes can play a much more 
substantial role in meeting the long-term care needs of veterans. MVH 
recognizes and supports the national trend toward 
deinstitutionalization of healthcare and the provision of long-term 
healthcare in the most independent and cost-effective setting. We have 
previously proposed to the VA that we explore together creative ways to 
provide a complete and conveniently located continuum of healthcare to 
our veterans, both rural and urban, at State Veterans Home-sponsored 
facilities and in the community. We would be pleased to work with the 
Committee and the VA to explore options for developing pilot programs 
for innovative long-term healthcare solutions and for more closely 
integrating the State Veterans Home program into the VA's overall 
healthcare system for veterans.

                                 
   Prepared Statement of R. Roy Griffith, Chairman, Liaison Committee
           National Association of State Veterans Homes, and
         Administrator, Oklahoma Veterans Center, Talihina, OK
    Chairman Michaud, Ranking Member Miller, Members of the 
Subcommittee:
    I want to commend you for holding today's hearing and thank you 
very much for inviting the National Association of State Veterans Homes 
(NASVH) to testify on the role of State Homes in the provision of long 
term care to our Nation's veterans. I especially want to thank you for 
allowing me to substitute for our national Legislative Chair, Bob Shaw, 
who was unable to make it to today's hearing due to the recent death of 
his mother.
    This morning I am speaking as a member of NASVH's Executive 
Committee and Chairman of our VA Liaison Committee, where I am 
responsible for interfacing with the Department of Veterans Affairs. In 
addition, I am here as the Administrator of the Oklahoma Veterans 
Center in Talihina, Oklahoma, which provides long term care for 175 
veterans, including a 48 bed wing for ambulatory Alzheimer's patients.
    Mr. Chairman, the State Home program dates back to the post-Civil 
War era when several States established homes in which to provide 
shelter and care to otherwise homeless, sick and maimed Union soldiers 
and sailors. In 1888 Congress first authorized Federal grants-in-aid to 
the States that maintained these homes, including a per diem allowance 
for each veteran of twenty-seven cents ($100 per year per veteran). 
Over the years since that time, the State Home program has been 
expanded and refined to reflect the improvements in standards of 
medical practice, including the advent of nursing home, domiciliary, 
adult day health, and other specialized geriatric care for veterans.
    For example, as I mentioned, the facility that I manage in Talihina 
has a 30-bed secure unit for Alzheimer's patients, a growing need in 
this veterans' population. At least two State Homes are providing adult 
day healthcare, and a number of others are developing programs or plans 
for this discipline and other emerging approaches to delivering care in 
less restrictive settings. In fact we are presently working with VA and 
State officials in a task force established by Deputy VA Secretary 
Gordon Mansfield to examine ways to establish more veterans adult day 
healthcare programs through auspices of the States and their State 
Veterans Homes.
    Mr. Chairman, with the aging of our ``baby boomer'' generation, 
America faces a looming long term care crisis, one that many of our 
Nation's veterans are already facing. Although the veteran population 
is declining, their needs are still rising. VA projects that today's 
veteran population of 24.5 million will continue to decline through 
2020, but that the number of veterans over 65 years of age will rise 
and ultimately peak in the year 2014, driven by the very large number 
of Vietnam veterans. Most alarming, the number of veterans over the age 
of 85 is projected to increase by 173 percent by 2020, creating an ever 
greater number of veterans seeking long term care services.
    Another important factor to consider is that we are seeing 
extraordinarily disabled veterans coming home from Iraq and Afghanistan 
with levels of injury and disability unheard of in past wars. Our 
incredible military medical triage and its applied technology has saved 
them, and many of them are now in VA polytrauma centers, but they 
present a medical and social challenge the likes of which we have never 
seen before. We are grateful that the numbers of these polytraumatic'' 
injured are relatively small, but we must be cognizant that they will 
need extraordinary care and shelter for the remainder of their lives. 
While VA is doing an excellent job to address their immediate needs, 
neither VA nor these veterans' families are fully prepared today to 
deal with their longer term needs. I am hopeful that our partnership 
with VA might be a basis for the State Veterans Homes to play a small 
but vital role in aiding these catastrophically injured veterans by 
providing them a home-like atmosphere, a caring environment and the 
level of clinical services they are going to need for the remainder of 
their lives.
    Finally, the newest generation of veterans, from the Persian gulf 
war until today, exhibits different expectations than their 
counterparts of the past. In general they are computer literate, well 
educated, want more involvement in their own care and want to control 
their own destinies. As these veterans age into later life and begin to 
need long-term care services, this will make VA's and our jobs much 
more challenging.
    Mr. Chairman, today State Homes provide the bulk of long term care 
for our Nation's veterans. Last year GAO reported that State Homes 
provide more than 50 percent of VA's overall patient workload in 
nursing homes, while consuming just 12 percent of VA's long term care 
budget. And the trend over recent years shows that State Homes are 
increasing their share of workload while their share of VA's budget 
continues to decline. VA pays just $67.71 as a per diem payment for 
each veteran residing in a State Home, which is less than one-third of 
the average cost of that veteran's care. The remaining two-thirds is 
made up from a mix of funding, including State support, Medicaid, and 
other public and private sources.
    Compare this to VA's cost when contracting out with community 
nursing homes where VA covers 100 percent of the cost of care, often 
upward of $200 per day, or when VA provides the care through one of its 
own nursing homes, where the average cost of care is in excess of $400 
per day.
    In addition to this per diem support, VA also helps cover the cost 
of construction, rehabilitation, and repair of State Veterans Homes on 
a matching basis with States. VA will provide up to 65 percent of the 
cost with the State providing at least 35 percent of the project's 
costs. The program was refined in 1999 under the Veterans Millennium 
Healthcare and Benefits Act, which created a series of priority 
categories for pending construction projects. At the top of the 
priority list are life and safety projects, and new home construction 
in States without any State Home beds.
    Unfortunately, in FY 2006, the construction grant program was cut 
from $104.3 million down to $85 million after a decade of stable 
funding marked by modest Consumer Price Index-type increases. In FY 
2007 the administration proposed and succeeded in holding down this 
funding at the reduced level of $85 million, continuing the $20 million 
reduction below the established 2005 baseline. The total funding 
reduction over 2 years is approximately $40 million.
    As a result of these real-dollar reductions, as well as the effects 
of inflation and rapidly rising construction costs, the backlog of 
State Home construction projects is rapidly rising. There are currently 
$242 million in pending ``priority 1'' State Home projects, and NASVH 
estimates that the total backlog of all potential qualifying State Home 
projects, including new and replacement bed and new home proposals in 
Texas, North Carolina, North Dakota, California, Florida and other 
States, could soon surpass $1 billion.
    Last month, NASVH testified before the Appropriations Subcommittee 
and requested that funding for the State Home construction grant 
program be increased to at least $160 million in FY 2008 in order to 
reduce the rising backlog, address the most serious life and safety 
issues, and protect the State Home system for the future. We would be 
grateful for any support you and this Committee can offer in that 
regard.
    I believe it is important to note for the Subcommittee that, since 
the Civil War, States have assumed the burden of care for veterans and 
today spend over $3 billion annually to provide this care, despite the 
fact that veterans of our armed forces are serving the whole nation, 
not just their States. Seen this way, the care rendered to veterans by 
the States actually constitutes a subsidy to the Federal Government, 
even though the rhetoric you may hear makes the opposite argument--that 
VA subsidizes the States. In fact, if the States were to choose to 
abandon the State Home program, the burden of care for these veterans 
would revert to the Federal Government, either through the VA directly, 
or to Medicare and Medicaid.
    Finally, Mr. Chairman, like all healthcare facilities, State Homes 
are not immune from human errors and operational problems, such those 
recently reported in Arizona and Minnesota When such problems are 
discovered, they must not only be aggressively investigated and 
corrected, but the State Home has an obligation to take additional 
measures to ensure that such problems do not recur. As a system, 
however, NASVH is quite proud of the record of State Homes in providing 
quality care. One reason for this record is the extremely tough 
regulatory and oversight controls placed on State Homes--by both 
Federal and State agencies.
    Most State Veterans Homes are part of a State's departments of 
veterans' affairs, public health, or other State agency. Some Homes 
operate under the governance of a Board of trustees, a Board of 
Visitors, or other body made up of prominent citizens, retired senior 
military personnel, former state and Federal public officials and 
veterans. In addition, State financial and management agencies and 
offices will often perform extensive audits of State Homes every two to 
3 years.
    Each State is responsible for ensuring veterans receive quality 
long term and healthcare services and achieve high patient 
satisfaction, safe environmental conditions, and sound financial 
management. The primary responsibility resides in the State agency or 
office that manages State Homes, although other State agencies may 
share some oversight responsibilities, such as for finances. State 
Homes that are overseen by Boards also face direct scrutiny from their 
appointed Board Members. As State-owned public buildings, State Homes 
are subject to State and local fire marshal and life-safety inspections 
on a routine basis to examine for fire hazards and life-safety issues.
    In addition, the Department of Veterans Affairs holds State Homes 
to the same high standards as are applied to nursing homes that VA owns 
and operates. State Homes are inspected annually by teams of VA 
examiners, including physicians, nurses, social workers, dieticians, 
activity specialists and mechanical and structural engineers. These 
visits typically consume a week, with more time involved for resolving 
any issues VA's examiners identify. VA's Inspector General also audits 
and inspects State Homes whenever and wherever it is determined 
necessary.
    In addition, States Homes authorized to receive Medicaid and 
Medicare reimbursement are subject to unannounced inspections by the 
Centers for Medicare and Medicaid Services (CMS), usually consuming 
three or more workdays, and staffed by a variety of long term care 
experts. State Homes are also subject to announced and unannounced 
inspections by HHS's Inspector General. Furthermore, the Department of 
Justice's Civil Rights Division is fully authorized to conduct 
investigations and takes necessary legal action to correct any 
complaints of neglect or abuse found to exist at State-run nursing 
homes. Finally, in some State Homes national veterans service 
organizations (VSOs), such as The American Legion, will regularly 
inspect State Homes, looking at both operational and management issues.
    Mr. Chairman, State Veterans Home provide safe, high-quality and 
affordable care to our Nation's veterans. This successful Federal-State 
partnership is an indispensable component of our nation's long term 
care resources, and we are grateful for your continued support. 
Millions of American veterans are going to need long-term care in the 
years ahead and the State Veterans Home system must continue to be an 
important component of the solution.
    Mr. Chairman, this concludes my testimony. I would be pleased to 
answer any questions you may have.

                                 
 Prepared Statement of Shannon L. Middleton, Deputy Director, Veterans 
         Affairs and Rehabilitation Commission, American Legion
    Mr. Chairman and Members of the Subcommittee:
    Thank you for this opportunity to submit The American Legion's 
views on VA's strategic direction and plans to address the aging 
veteran population and the needs of the recently separated veterans.
AGING VETERAN POPULATION
    A July 1984 study, Caring for the Older Veteran, predicted that a 
``wave'' of elderly World War II and Korean Conflict veterans would 
occur some 20 years ahead of the elderly in the general U.S. population 
and had the potential to overwhelm the VA Long Term Care (LTC) system 
if not properly planned for. The most recent available data from VA, 
2000 Census-based VETPOP 2001 Adjusted, show there were 25.6 million 
veterans in 2002 and 9.76 million, or 37 percent, are aged 65 or older. 
According to the 2003 National Survey of Veteran Enrollees' Health and 
Reliance on VA, 14 percent of the veteran population was under the age 
of 45, 39 percent were between the ages of 45 and 64, and 47 percent of 
veterans were 65 years or older. Compared to the 2001 Survey, in which 
age distribution was 21, 41 and 39 percent respectively, it is clear 
that the ``demographic imperative'' predicted in 1984 is now upon us.
    The study cited an ``imminent need to provide a coherent and 
comprehensive approach to long-term care for veterans.'' Twenty-three 
years hence, the coherent and comprehensive approach called for has yet 
to materialize. The American Legion supports a requirement to mandate 
that VA publish a comprehensive Long Term Care Strategic Plan.
    The Veterans Millennium Healthcare and Benefits Act 1999 provided 
VA the authority to act on these projections. Based on an ``aging in 
place'' continuum of care model, VA was mandated to begin providing a 
variety of non-institutional services to aging veterans, including; 
home-based primary care, contract home healthcare, adult day 
healthcare, homemaker and home health aides, respite care, telehealth 
and geriatric evaluation and management.
    On March 29, 2002, the government Accountability Office issued a 
report that stated that nearly 2 years after the Millennium Acts 
passage, VA had not implemented its response to the requirements that 
all eligible veterans be offered adult day healthcare, respite care and 
geriatric evaluation. At the time of GAO's inquiry, access to these 
services was ``far from universal.'' While VA served about one-third of 
its 3rd Quarter 2001 LTC workload (23,205 out of an Average Daily 
Census of 68,238) in non-institutional settings, VA only spent 8 
percent of its LTC budget on these services. Additionally, VA had not 
even issued final regulations for non-institutional care, but was 
implementing the services by issuing internal policy directives, 
according to GAO. Of 140 VAMCs, only 100 or 71 percent were offering 
adult day healthcare in non-institutional settings.
    By May 22, 2003, over 1 year later, GAO testified before this 
Subcommittee that things had not improved and that veterans' access to 
non-institutional LTC was still limited by service gaps and facility 
restrictions. GAO's assessment showed that for four of the six 
services, the majority of facilities either did not offer the service 
or did not provide access to all veterans living in the geographic 
service area. GAO summarized the problem nicely when it testified that 
``[f]aced with competing priorities and little guidance from 
headquarters, field officials have chosen to use available resources to 
address other priorities.''
    In the area of nursing home care, VA is equally recalcitrant in 
implementing the mandates of the Millennium Act. The Act required VA to 
maintain its in-house Nursing Home Care Unit (NHCU) bed capacity at the 
1998 level of 13,391. In 1999 there were 12,653 VA NHCU beds, 11,812 in 
2000, 11,672 in 2001, 11,969 in 2002 and 12,339 beds in 2003. VHA 
estimates it had 11,000 beds in 2004 and projected only 8,500 beds for 
fiscal year 2005. The American Legion believes that VA should be 
required to restore its nursing home care unit capacity as intended by 
Congress to the 1998 level. Additionally, VA should be prohibited from 
counting any but their own nursing home care unit beds for the purpose 
of compliance with the provisions of the Millennium Act.
    VA claims that it cannot maintain both the mandated bed capacity 
and implement all the requirements of the Millennium Act. Providing 
adequate inpatient LTC capacity is good policy and good medicine. The 
American Legion opposes attempts to repeal 38 U.S.C.  
1710B(b).The American Legion believes VA should provide the quality of 
care mandated by Congress for the long term care of America's veterans. 
Congress should provide adequate funding to VA to implement its 
mandates.
State Extended Care Facility Construction Grants Program
    Since 1984, nearly all planning for VA inpatient nursing home care 
has revolved around State Veterans' Homes (SVHs) and contracts with 
public and private nursing homes. The reason for this is obvious; for 
fiscal year 2004 VA paid a per diem of $59.48 for each veteran it 
places in SVHs, compared to the $354.00 VA said it cost in FY 2002 to 
maintain a veteran for 1 day in its own NHCUs.
    Currently, VA is authorized to make payments to states for 
construction and maintenance of SVHs. Today, there are 109 SVHs in 47 
states with over 23,000 beds providing nursing home, hospital, and 
domiciliary care. Grants for construction of state extended care 
facilities provide funding for 65 percent of the total cost of building 
new veterans' homes. Recognizing the growing long-term healthcare needs 
of older veterans, it is essential that the State Veterans' Home 
Program be maintained as a viable and important alternative healthcare 
provider to the VA system. State authorizing legislation has been 
enacted and state funds have been committed. The West Los Angeles State 
Veterans' Home, alone, is a $125 million project. Delaying this and 
other projects will result in cost overruns from increasing building 
materials costs and may lead states to cancel these much-needed 
facilities.
    The American Legion supports increasing the amount of authorized 
per diem payments to 50 percent for nursing home and domiciliary care 
provided to veterans in State Veterans' Homes. The American Legion also 
supports providing prescription drugs and over-the-counter medications 
to State Homes Aid and Attendance patients, along with the payment of 
authorized per diem to State Veterans' Homes. Additionally, VA should 
allow for full reimbursement of nursing home care to 70 percent 
service-connected veterans or higher, if the veteran resides in a State 
Veterans' Home.
COMMISSION ON THE FUTURE FOR AMERICAN'S VETERANS
    In testimony delivered in 2006 addressing VA Long Term Care, GAO 
identified a major challenge in VA's ability to plan for nursing home 
care as estimating which veterans will seek care from VA and what their 
nursing home needs will be. The unpredictability of the long term care 
needs of those suffering from polytrauma, blast injuries and lasting 
mental health conditions as a result of participation in the ongoing 
Global War on Terror will no doubt make planning even more challenging.
    The Commission on the Future for America's Veterans was established 
in September 2006. The Commission's purpose is to ascertain the needs 
of veterans 20 years in the future. The Commissioners are experts on 
veterans' issues and include Past National Commanders of the largest 
veterans service organizations, those who have treated combat veterans, 
as well as a former VA administrator and a former Congressman. The 
Commission was created by the Veterans Coalition, which includes The 
American Legion, Veterans of Foreign Wars (VFW), Disabled American 
Veterans (DAV), Paralyzed Veterans of America (PVA), AMVETS, Vietnam 
Veterans of America, Blinded American Veterans, Jewish War Veterans, 
and Military Order of the Purple Heart
    The Commission has been conducting townhall meetings around the 
country to allow veterans, family members and caregivers an opportunity 
to express their views on the future needs of servicemembers, 
especially those who have been injured in the current Global War on 
Terror. At the conclusion of this fact finding initiative, the 
Commission will create a report that will include recommendations for 
addressing the needs identified. The Commission plans to deliver 
recommendations to the President, Congress, and the American public by 
Memorial Day 2008.
    The American Legion supports this timely and proactive endeavor and 
hopes VA and Congress utilize the findings to prepare for the long-term 
needs of the newest era of war veterans.
MANDATORY FUNDING FOR VETERANS HEALTH CARE
    A new generation of young Americans is once again deployed around 
the world, answering the nation's call to arms. Like so many brave men 
and women who honorably served before them, these new veterans are 
fighting for the freedom, liberty and security of us all. Also, like 
those who fought before them, today's veterans deserve the due respect 
of a grateful nation when they return home.
    Unfortunately, without urgent changes in healthcare funding, new 
veterans will soon discover their battles are not over. They will be 
forced to fight for the life of a healthcare system that was designed 
specifically for their unique needs. The American Legion believes that 
the solution to the Veterans Health Administration (VHA) recurring 
fiscal difficulties will only be achieved when VA funding becomes 
mandatory. Funding for VA healthcare currently falls under 
discretionary spending within the Federal budget. VA's healthcare 
budget competes with other agencies and programs for Federal dollars 
each year. VA's ability to treat veterans with service-connected 
injuries is dependent upon discretionary funding approval from Congress 
each year.
    Under mandatory funding, VA healthcare would be funded by law for 
all enrollees who meet the eligibility requirements, guaranteeing 
yearly appropriations for the earned healthcare benefits of enrolled 
veterans.
    The Veterans Health Administration is now struggling to meet its 
requirement to provide timely access to healthcare with funding methods 
that were developed in the 19th century. The American Legion believes 
that healthcare rationing for veterans must end. It is time to 
guarantee healthcare funding for all veterans.
    Mr. Chairman, that concludes my testimony.

                                 
Prepared Statement of Adrian M. Atizado, Assistant National Legislative 
                  Director, Disabled American Veterans
    Mr. Chairman and Members of the Subcommittee:
    On behalf of the more than 1.3 million members of the Disabled 
American Veterans (DAV) and its Auxiliary, I wish to express my 
appreciation for this opportunity to present the Subcommittee our views 
on the present and future state of long-term care programs in the 
Department of Veterans Affairs (VA). Mr. Chairman, as you know, DAV is 
an organization devoted to advancing the interests of service-connected 
disabled veterans, their dependents, and survivors. For the past eight 
decades, the DAV has devoted itself to a single purpose: building 
better lives for our Nation's disabled veterans and their families.
    The DAV is cognizant of VA's need to plan strategically how best to 
use its resources to provide equitable access for veterans needing 
acute care services, while also providing a growing elderly veteran 
population with institutional and non-institutional long-term care 
services. However, the present state of VA's long-term care program is 
now lagging behind its rich history as an early leader in caring for 
aging veterans, and is in danger of falling behind non-VA healthcare 
systems. We are concerned that the last published strategic plan for 
long-term care was prepared over 7 years ago. That strategic plan was 
intended to implement a number of recommendations from a 1998 report of 
VA's Federal Advisory Committee On the Future of VA Long-Term Care, 
entitled VA Long-Term Care At the Crossroads. This Crossroads report 
took a critical look at VA's long-term care program and highlighted the 
growing gulf between VA and non-VA long-term care systems. To address 
this disparity the report recommended swift and definitive action for 
VA to ``. . . retain its core of VA-operated long-term care services 
while improving access and efficiency of operations. Most new demand 
for care should be met through non-institutional services, contracting, 
and where available, State Veterans Homes.'' In 1999 a number of the 
Crossroads recommendations to expand and enhance VA's long-term care 
programs were incorporated in Public Law 106-117, the Veterans 
Millennium Healthcare and Benefits Act, but much of the promise of the 
Millennium Act remains unfulfilled.
    The number of service-connected disabled veterans rated 70 percent 
or higher for whom VA is required to provide extended care services has 
been increasing every year and experienced the highest growth from 
fiscal year 1999 through 2005. Accordingly, the delegates to the 2006 
DAV National Convention, held in Chicago, Illinois, once again approved 
a resolution calling for the expansion of a comprehensive program of 
long-term care services for service-connected disabled veterans, 
regardless of their percentages of disability ratings.
    Many elderly and infirm veterans, particularly those with service-
connected disabilities, use the VA for their healthcare needs in post-
acute and long-term care settings. Today, nearly 45 percent of the over 
24 million veterans and nearly 50 percent of the almost 8 million 
veterans enrolled in VA healthcare are over the age of 65. The number 
of veterans over age 85 is expected to reach 1.3 million by 2011. In 
addition, the majority of VA enrollees plan to use VA as their primary 
source of healthcare. Given these projections, the wave of aging 
veterans will become a geriatric imperative with which VA will likely 
see a steadily rising and significant demand for long-term care 
services in the near future.
    We are appreciative that in section 206 of P.L. 109-461 Congress 
required VA to develop a new strategic long-term care plan; however, we 
are concerned about the limited time the Act afforded VA in preparing 
such a critical plan. Furthermore, a March 20, 2006, report by the VA 
Office of Inspector General indicated VA is developing a Capital Asset 
Realignment for Enhanced Services (CARES) based strategic plan to 
address nursing home infrastructure inequities and realignments; 
however, the DAV is concerned that VA has not sought involvement, input 
or advice from veterans service organizations with any of these 
initiatives, unlike the 1999 VA strategic plan for long-term care in 
which this community was directly involved.
    VA's long-term care program received significant modification with 
the passage of Public Law 106-117, which brought some degree of parity 
between long-term care, which was considered discretionary care, and 
acute care, which was considered ``mandatory;'' however, some tension 
remains. Furthermore, this tension has translated down and between 
institutional and non-institutional extended care, where VA is required 
to provide non-institutional services to all enrolled veterans in need 
of such care but only requires VA to provide institutional services to 
a subset of enrolled veterans. Coupling this with the push for VA to 
drive down the cost of care while increasing the number of veterans 
served puts long-term care at a disadvantage, and all the more for 
institutional extended care. The DAV believes that long-term care is a 
fundamental part of the continuum of VA medical care. We therefore urge 
Congress and VA to address this aspect of the current state of VA long-
term care as you consider the future of this essential program.

                    Non-Institutional Long-Term Care

    As referenced above, VA's enhanced authority to use and make 
available non-institutional services, including respite care, assisted 
living and residential care such as adult day healthcare, skilled home 
nursing, home-based care models, homemaker/home health aide services, 
was added to VA's medical benefits package by the Millennium Act. 
However, nearly four years post-enactment, the government 
Accountability Office (GAO) testified and reported these enhanced VA 
services remained highly variable from facility to facility, and from 
Veterans Integrated Services Network (VISN) to VISN. The information 
noted existing variations in availability of non-institutional services 
across VA due to, among other reasons, the lack of existence of 
particular programs at a given VA facility and whether the veteran 
resides within a facility's geographic service area.
    More recently VA has reported large year-to-year increases in non-
institutional long-term care activity, but VA's data conventions for 
reporting this workload, which assists VA's ability to manage this 
program's patient population, are problematic for the purposes of 
oversight and may misstate that activity.
    While we applaud VA leadership in reinforcing the elimination of 
local restrictions limiting eligible veterans' access to non-
institutional care, we continue to receive reports that service-
connected disabled veterans are not receiving the care they need for 
their service-connected conditions because they do not reside in a VA 
facility's geographic service area. Moreover, we are concerned by the 
lack of systematic oversight to capitalize and advance the progress 
made in addressing this issue.
Hospice and Palliative Care
    To address the number of veteran deaths that has been increasing by 
about 8 percent annually to a current average of 1,800 per day, VA has 
emphasized providing hospice and palliative care to honor personal 
preferences for care at the end of life. While hospice and palliative 
care are covered benefits available to all enrolled veterans in all 
settings, VA must offer to provide or purchase hospice and palliative 
care that VA determines an enrolled veteran needs.
    Unfortunately, VA is the only public healthcare system that charges 
co-payments to hospice patients. Veterans who utilize this benefit may 
be subject to inpatient and outpatient co-payments if hospice is not 
provided in a VA nursing home bed.
    The DAV recommends the fulfillment of Congress's original intent in 
Public Law 108-422 that VA provide equitable and compassionate end of 
life services to veterans by exempting them from the requirement to pay 
co-payments when they receive VA hospice care in any setting. We also 
urge greater Subcommittee oversight on VA's end of life programs as 
many VA facilities have been aggressive in establishing end of life 
programs while others have lagged behind.

                      Institutional Long-Term Care

VA Nursing Home Care Units
    A common description of nursing home care is that it is the most 
restrictive and the least flexible mode of providing extended care 
services. Further, much like hospice care in its infancy, nursing home 
care is seen as an antithesis to medical care--a form of care in which 
patients will never recover or stabilize to the point where they can 
take care of themselves, or with a support system would be able go 
return home. While seemingly accurate, these observations do not fairly 
or entirely represent the value of institutional care, particularly for 
the veteran patient that suffers from serious chronic mental illness, 
spinal cord injury, behavioral problems, or is ventilator dependent and 
thus poses a significant problem for community placement.
    On average, elderly enrolled veterans have a higher divorce rate, a 
higher rate of marital separation, lower incomes, savings and other 
personal assets than age-matched non-veteran populations. They are more 
likely to live alone, be estranged from families, less likely to engage 
in social and community activities, more likely to exhibit unhealthy 
lifestyles with respect to exercise, alcohol, tobacco, and nutrition, 
and exhibit more tendencies to chronic mental illnesses. Caring for an 
aging veteran population with some of these characteristics in the 
least restrictive setting may well be in VA nursing home care units, 
rather than in community settings.
    Furthermore, the DAV believes that in addition to serving a 
specific patient population providing invaluable service such as 
indefinite self-care support, rehabilitative, and recuperative care, 
nursing home care is an integral component to VA's extended care 
benefits package as a part of that continuum. Moreover, VA's ``Culture 
Transformation'' initiative for nursing home care is centered on such 
core concepts as personal autonomy, privacy, dignity, flexibility, and 
individualized services. The culture change movement, which is well 
underway, is changing the old philosophy of patient centered care, 
which operates in a medical model of technical service delivery and 
intervention, and toward the new thinking of patient centered living in 
old age.
State Veterans Homes
    The DAV is concerned about the obvious shift in VA's long-term care 
workload away from meeting its statutory mandate to maintain VA nursing 
home capacity. This policy is unconscionable considering VA's own 
projected demand that the anticipated capacity in all three 
institutional settings (VA nursing home care units, community nursing 
homes, and State Veterans Homes) will not be sufficient to meet the 
total demand of enrolled veterans for institutional nursing services.
    While it is laudable that VA seeks to provide care to veterans who 
need VA the most by shifting more of its institutional care workload 
into State Veterans Homes, we applaud Congress for taking the first 
step to provide equitable relief for service-connected disabled 
veterans in State Veterans Homes through passage of section 211 of P.L. 
109-461. This provision authorizes direct VA placement of service-
connected veterans in State Veterans Homes, with VA reimbursement to 
the homes for the full cost of that care. We understand VA is moving 
forward rapidly to implement that provision with statutory regulations, 
and we commend VA for that action.
    The Crossroads report included important recommendations dealing 
with State Veterans Homes, but one that VA has not implemented nor 
recommended that Congress authorize. The Crossroads report 
enthusiastically endorsed VA facilities' making significantly greater 
use of State veterans facilities to meet enrolled veterans' 
institutional care needs, rather than building additional VA in-house 
capacity for that purpose. Unfortunately, VA has done neither. It is 
true that State capacity has increased to about 21,000 average daily 
census (ADC) compared to the 1997 level of 14,039 ADC, but 
proportionately the workload remains at about 52 percent of VA's total 
nursing home capability. There are ample reasons for this stagnation, 
related to individual State financial conditions; lack of a formal 
relationship providing incentives for VA facilities to refer veterans 
directly to State care; lack of resources to address the growing State 
home construction backlog (now nearing $500 million); and, VA legal 
interpretations that block better relations between State and VA 
facilities. VA has long articulated a ``partnership'' with the States 
in long-term care, but DAV recommends some of these obstacles be 
surmounted or legislatively removed in order for a true long-term care 
partnership to be established between VA and the States.
Community Nursing Home Care
    Mr. Chairman, in July 2001, GAO reported to Congress the results of 
its review of VA inspections of community nursing homes caring for VA-
referred patients. As a general rule, VA requires its facilities to 
inspect State Veterans Homes and contract community nursing homes on an 
annual basis, and to make staff visits to community nursing homes on a 
monthly basis. While GAO was satisfied that State home oversight was 
sufficient at that time, GAO recommended additional oversight by VA 
Central Office over inspection activities of community nursing homes. 
DAV recommends the Committee ask GAO to repeat its review of the 
inspection and monitoring of State Veterans Homes and community nursing 
homes caring for veterans under VA auspices.
Operation Iraqi Freedom (OIF) and Operation Enduring Freedom (OEF) 
        Veterans
    Mr. Chairman, when we think of long-term care, we assume that these 
programs are reserved for the oldest veterans, near the end of life. 
Today, however, we confront a new population of veterans in need of 
specialized forms of long-term care--a population that will need 
comfort and care for decades. These are the veterans suffering from 
polytraumatic injuries and traumatic brain injuries as a consequence of 
combat in Iraq and Afghanistan. In discussion with VA officials, 
including facility executives and clinicians now caring for some of 
these injured veterans, it has become apparent to DAV and others in our 
community that VA still needs to adapt its existing long-term care 
programs to better meet the individualized needs of a truly special and 
unique population, VA's existing programs will not be satisfactory or 
sufficient in the long run. In that regard, VA needs to plan to 
establish age-appropriate residential facilities, and additional 
programs to support these facilities, to meet the needs of this new 
population. While the numbers of veterans sustaining these catastrophic 
injuries are small, their needs are extraordinary. While today they are 
under the close supervision of the Department of Defense and its health 
agencies, their family members, and VA, as years go by, VA will become 
a more crucial part of their care and social support system, and in 
many cases may need to provide for their permanent living arrangements 
in an age-appropriate therapeutic environment.

                        Unresolved Policy Issues

    Nearly a decade after issuance of the Crossroads report and 
enactment of the Millennium Act, and despite encouragement from this 
Subcommittee and others, VA remains without a clearly articulated 
policy on long-term care. We commend VA for adding new long-term care 
programs over those years, especially those dealing with home--and 
community-based approaches, but we were concerned in 2005 when the VA 
proposed that Congress further restrict long-term care eligibility and 
to probably deny access to VA long-term care to major segments of the 
veteran population, at a moment when the elderly veteran population was 
peaking. We thank this Subcommittee for its support of a continuation 
of current eligibility for these services.
    As VA has ramped up community-based, non-bed programs such as home-
based primary care, it has not changed its reporting conventions such 
that it still equates a day of care in a community-based or home-based 
program to that of a day of care in a nursing home or other 
institutional setting. This type of data collection and reporting may 
produce a distortion of activity or workload when in fact none may be 
present.
    While VA has become highly efficient at converting its nonservice-
connected community nursing home placements to Medicaid status, it has 
established no formal tie to the Centers for Medicare and Medicaid 
Services (CMS) or with the States to oversee that unwritten policy. 
Also with regard to institutional and home hospice, despite offering to 
purchase hospice VA refers thousands of veterans from its own program 
to those of Medicare without acknowledging it is doing so, while 
charging co-payments to dying veterans in its own hospice programs.
    In the State Veterans Home program, VA claims to be participating 
in a ``partnership'' but only provides a per diem payment to the States 
as they deal with their veterans' long-term care burdens. Some VA 
facilities even deny access to enrollment and to specialized VA care 
for residents of State Veterans Homes on the basis that the homes are 
responsible for comprehensive care, not VA.
    All these informal policies are working their will, but we question 
whether they are working to the betterment of the care of elderly 
veterans or simply are manifestations of ways to shift VA costs for 
long-term care to other willing payers. DAV does not expect VA to 
provide long-term care to every American veteran, but to the degree VA 
holds itself out as a provider of these services, DAV believes the 
policies under which it operates ought to be transparent and well 
understood. Neither case is true today.

                                Closing

    Mr. Chairman, the future of VA long-term care planning remains 
uncertain. The lack of a strategic plan that involves stakeholder input 
is discouraging to DAV and others in this community. Also, as this 
Subcommittee conducts needed hearings on VA long-term care services, we 
urge the Subcommittee to provide stronger oversight of VA's unwritten 
long-term care policies to be sure they are equitable for veterans who 
need such care.
    Although DAV advocates for a more comprehensive geriatric and 
extended care benefits package for service-connected disabled veterans 
regardless of their percentages of disability ratings, it is clear that 
VA's current policy reflects a struggle between what is expected and 
what it can deliver based on available resources. As the late Dr. Paul 
Haber said of VA in 1975 on the occasion of the establishment of the VA 
Office of Extended Care, ``As the number of aging veterans increases 
over the next decades, the Department will need to expend more 
resources for their care. Expanding services for old, chronically ill 
patients will cause disquietude among some in the Department.'' 
Although he was referring to the ``Department of Medicine and 
Surgery,'' now known as the Veterans Health Administration (VHA), Dr. 
Haber's words still ring true today. The VHA is forced to choose 
between emphasizing institutional or non-institutional modes of long-
term care, both of which are not available to the same population of 
enrolled veterans. These needs must compete internally with the funding 
of VA acute care and primary care services. Moreover, VA is operating 
with limited overall healthcare resources, making allocation decisions 
ever more difficult, and further hampered by the absence of clear 
direction due to inequities in existing authority in the eligibility 
criteria for institutional and non-institutional VA long-term care.
    A continuum of care is essential to effectively meet the healthcare 
needs of our aging veteran population who live with complex medical, 
social, behavioral, and functional impairments, as well as to fully 
meet the needs of the newest generation of veterans injured by war. To 
ensure that veterans receive the benefits of these programs in a 
coordinated, integrated manner, a full array of non-institutional 
extended care services complemented with institutional geriatric care 
services must be available throughout each VISN, and accessible to all 
enrolled veterans.
    Mr. Chairman, 25 years ago VA published a report entitled Care for 
the Aging Veteran. This was a landmark study and set the stage for many 
of the programs VA uses today to care for elderly veterans. One of the 
premises of that era was that VA would take the lead in the ``graying 
of America,'' by establishing models of care in geriatrics and 
gerontology that would be emulated and replicated in other public and 
private systems of care. While we applaud the obvious progress VA has 
made, we observe most of the promise that was in the ``Aging Report'' 
has not materialized in long-term care policy in the United States. 
While we hope other Congressional Committees will eventually address 
the larger picture of an aging America and how to meet those needs, we 
urge this Subcommittee to establish clear guidelines for prioritizing 
among VA's existing and emerging programs and the eligibility of 
veterans to receive care in such programs. We hope the Subcommittee and 
your colleagues on the Appropriations Committees of both Chambers will 
ensure VA has the resources to meet the expectation to provide sick and 
disabled veterans the levels of care they need, including the needs of 
the programs we have addressed today in this testimony. Equally 
important, we urge Congress to continue to hold VA accountable in 
providing a full complement of high quality, cost effective geriatric 
and extended care services to aging veterans.
    Mr. Chairman, we thank you for holding this important hearing to 
discuss the state of the VA's long-term care programs. While I have 
tried to bring forward relevant issues in long-term care that are 
important to DAV, the complexity, magnitude and impact of this program 
compel additional hearings. We urge the Subcommittee to consider 
holding those hearings in order for Congress to gain a fuller 
understanding on what needs to be done, for veterans and for all of our 
citizens as we age. As of today, much still remains despite the obvious 
progress we have observed.
    This concludes my statement, and I will be happy to address any 
questions the Subcommittee may have.

                                 
 Prepared Statement of Fred Cowell, Senior Associate Director, Health 
                Analysis, Paralyzed Veterans of America
    Mr. Chairman and Members of the Committee, the Paralyzed Veterans 
of America (PVA) is pleased to present its views concerning access to, 
and the availability of, quality long-term care services for our 
Nation's veterans. PVA's testimony is focused in three areas. First, we 
would like to draw your attention to the long-term care needs of 
America's returning heroes from Operation Iraqi Freedom (OIF) and 
Operation Enduring Freedom (OEF). Thousands of these brave young men 
and women are facing lifelong challenges because of the severity of 
their wounds and will depend on VA non-institutional and VA 
institutional long-term care programs for much, if not all, of their 
lives. Second, our testimony will address the unique long-term care 
needs of veterans with spinal cord injury or disease (SCI/D) and the 
looming gap in providing specialized care for these men and women. 
Finally, we will address broad long-term care issues affecting all 
aging veterans and how a VA long-term care strategic plan can make a 
difference in their care.
    Currently, VA provides an array of non-institutional (home and 
community-based) long-term care programs designed to support veterans 
in their own communities while living in their own homes. Additionally, 
VA provides institutional (nursing home) care in three venues to 
eligible veterans and others as resources permit. VA provides nursing 
home care in VA operated nursing homes, under contract with private 
community providers, and in State Veterans Homes.
    Mr. Chairman, PVA is a long time supporter of non-institutional 
long-term care programs because they have, in many cases, enabled aging 
veterans, our members, and other veterans with catastrophic 
disabilities to live independent and productive lives in the least 
restrictive setting. PVA has always believed that nursing home care 
must always be a choice of last resort and that no veteran should be 
forced into a nursing home just because of his/her spinal cord injury, 
spinal cord disease or other catastrophic disability.
    However, many aging veterans and veterans with catastrophic 
disabilities live on a slippery slope even with the support of non-
institutional long-term care. Slight changes in function associated 
with aging, a serious episode related to a secondary condition, or the 
loss of a care giver can plunge even a young veteran with a 
catastrophic disability down that slippery slope from independent 
living at home into institutional nursing home care. Therefore, it is 
imperative that VA continue to provide quality nursing home care not 
only for aging veterans but for those younger catastrophically injured 
veterans who cannot benefit from non-institutional long-term care 
services.
Young OIF/OEF Veterans
    Mr. Chairman, PVA believes that age-appropriate VA non-
institutional and institutional long-term care programming for young 
OIF/OEF veterans must be a priority for VA and your Subcommittee. New 
VA non-institutional and institutional long-term care programs must 
come online and existing programs must be re-engineered to meet the 
various needs of a younger veteran population.
    VA's non-institutional long-term care programs will be required to 
assist younger injured veterans with catastrophic disabilities who need 
a wide range of support services such as: personal attendant services, 
programs to train attendants, peer support programs, assistive 
technology, hospital-based home care teams that are trained to treat 
and monitor specific disabilities, and transportation services. These 
younger veterans need expedited access to VA benefits such as VA's Home 
Improvement/Structural Alteration (HISA) grant, and VA's adaptive 
housing and auto programs so they can leave institutional settings and 
go home as soon as possible. PVA also believes that VA's long-term care 
programs must be linked to VA's new polytrauma centers so that younger 
veterans can receive injury specific annual medical evaluations and 
continued access to specialized rehabilitation, if required, following 
initial discharge.
    VA's institutional nursing home care programs must change direction 
as well. Nursing home services created to meet the needs of aging 
veterans will not serve young veterans well. As pointed out in The 
Independent Budget, VA's Geriatric and Extended Care staff must make 
every effort to create an environment for young veterans that 
recognizes they have different needs. Younger catastrophically injured 
veterans must be surrounded by forward-thinking administrators and 
staff that can adapt to youthful needs and interests. The entire 
nursing home culture must be changed for these individuals, not just 
modified. For example, therapy programs, living units, meals, 
recreation programs, and policy must be changed to accommodate young 
veterans entering the VA long-term care system.
Veteran with Spinal Cord Injury or Disease (SCI/D)
    PVA is concerned that many veterans with spinal cord injury and 
disease are not receiving the specialized long-term care they require. 
VA has reported that over 900 veterans with SCI/D are receiving long-
term care outside of VA's four SCI/D designated long-term care 
facilities. However, VA cannot report where these veterans are located 
or if their need for specialized medical care is being coordinated with 
area VA SCI/D centers.
    Today's VA SCI/D long-term care capacity cannot meet current or 
future demand for these specialized services. Waiting lists exist at 
the four designated SCI/D facilities. Currently, VA only operates 125 
staffed long-term care (nursing home) beds for veterans with SCI/D. 
These facilities are located at: Brockton, Massachusetts (30 beds); 
Castle Point, New York (15 beds); Hampton, Virginia (50 beds); and 30 
beds at the Hines Residential Care Facility in Chicago, Illinois. 
Geographic accessibility is a major problem because none of these 
facilities are located west of the Mississippi River. New designated VA 
SCI/D long-term care facilities must be strategically located to 
achieve a national geographic balance to long-term care to meet the 
needs of veterans with SCI/D that do not live on the East coast of the 
United States.
    VA's own Capital Asset Realignment for Enhanced Services (CARES) 
data for SCI/D long-term care reveals a looming gap in long-term care 
beds to meet future demand. VA data projects an SCI/D long-term care 
bed gap of 705 beds in 2012 and a larger bed gap of 1,358 for the year 
2022. VA's proposed CARES SCI/D long-term care projects would add 
needed capacity (100 beds) but are very slow to come online. CARES 
proposes adding 30 SCI/D LTC beds at Tampa, Florida; 20 beds at 
Cleveland, Ohio; 20 beds at Memphis, Tennessee; and 30 beds at Long 
Beach, California. The CARES Tampa project is currently under 
construction but is not scheduled to open for another 2 years and the 
Cleveland project is currently in the design phase but remains years 
from completion. The Memphis and Long Beach projects have not even 
entered the planning stage at this time.
    Methods for closing the VA SCI/D long-term care bed gap and 
resolving the geographic access service issue are part of the same 
problem for PVA. VA's Construction Budget for 2008 includes plans for 
new 120 bed VA nursing homes to be located in Las Vegas, Nevada and at 
the new medical center campus in Denver, Colorado. Also, VA has 
announced construction planning of a new 140 bed nursing home care unit 
in Des Moines, Iowa.
    Mr. Chairman, PVA needs your support to ensure VA construction 
planning dedicates a percentage of beds at each new VA nursing home 
facility for veterans with SCI/D. PVA requests that Congress mandate 
that VA provide for a 15 percent bed set-aside in each new VA nursing 
home construction project to serve veterans with SCI/D and other 
catastrophic disabilities. These facilities will require some special 
architectural design improvements and trained staff to meet veteran 
need. However, much of the design work has already been accomplished by 
PVA and VA's Facility Management team. This Congressional action will 
help reduce the SCI/D bed-gap and help meet the current and future 
demand for long-term care. While a 15 percent bed allocation in new VA 
nursing home construction plus the proposed CARES LTC projects do not 
solve the looming bed gap problem in the short run it is a good first 
step and these additions will improve VA's SCI/D long-term care 
capacity in the western portion of the country.
    Public Law 109-461 required VA to develop and publish a strategic 
plan for long-term care. PVA congratulates Congress on understanding 
the importance of this issue to ensure that America's catastrophically 
disabled and aging veteran population is well cared for. During the 
organization of VA's strategic long-term care plan PVA, calls on VA and 
Congress to pay careful attention to the institutional and non-
institutional long-term care needs of veterans with SCI/D and other 
catastrophic disabilities. We request that PVA and other veteran 
service organizations have an opportunity to provide input and assist 
VA as it moves forward in the development of this important document.
    Mr. Chairman, in the past and even today many veterans with spinal 
cord injury or disease and other catastrophic disabilities have been 
shunned from admittance to both VA and community nursing homes because 
of their high acuity needs. PVA believes that catastrophic disability 
must never be grounds to refuse admittance to VA or contract VA long-
term care services. PL 109-461 requires VA to include data on, ``the 
provision of care for catastrophically disabled veterans; and the 
geographic distribution of catastrophically disabled veterans.'' This 
information is critical if VA's strategic plan is to adequately address 
the needs of this population.
VA's Nursing Home Capacity Mandate
    Congress has mandated that VA maintain its nursing home average 
daily census (ADC) at the 1998 level of 13,391 but VA has not done so 
(Chart 1.). Instead, VA has been steadily shifting its institutional 
long-term care workload to State Veterans Homes and to contract 
community (private sector) providers (Chart 2.). According to the 
government Accountability Office (GAO) (GAO Report # 06-333T), VA's 
overall nursing home workload for 2005 is split as follows: 52 percent 
State Veterans' Homes, 35 percent VA nursing homes, and 13 percent 
Contract Community nursing homes.

            Chart 1.  ADC for VA's Nursing Home Care Program
------------------------------------------------------------------------
                   Year                        Average Daily Census
-----------------------------------------------------------------------
1998                                                           13,391
------------------------------------------------------------------------
2004                                                           12,354
------------------------------------------------------------------------
2005                                                           11,548
------------------------------------------------------------------------
2006                                                           11,434
------------------------------------------------------------------------
Decrease 1998-2006                                              1,957
------------------------------------------------------------------------


 Chart 2.  ADC Increases in VA's Contract Community Nursing Home Program and in the State Veterans Homes Program
----------------------------------------------------------------------------------------------------------------
                                          Contract Community Providers
-----------------------------------------------------------------------------------------------------------------
                        Year                                 ADC                  Year                 ADC
----------------------------------------------------------------------------------------------------------------
2004                                                             4,302                   2004            17,328
----------------------------------------------------------------------------------------------------------------
2005                                                             4,254                   2005            17,794
----------------------------------------------------------------------------------------------------------------
2006                                                             4,395                   2006            17,747
----------------------------------------------------------------------------------------------------------------
Increase 2004-2006                                                  93     Increase 2004-2006               419
----------------------------------------------------------------------------------------------------------------

    Despite clear VA data that highlights the aging of the veteran 
population and an associated increasing demand for services, the ADC 
for VA nursing home care continues to trend downward. This is 
especially concerning because of the nation's large elderly population. 
According to VA data, (VA Strategic Plan FY 2006-2011) veterans 85 and 
older represent 4.5 percent of the total veteran population and VA 
projects that by 2011, the number of veterans age 85 and older will 
grow to more than 1.3 million. Veterans 65 to 84 years old represent 
33.9 of the total veteran population; and veterans 45 to 64 years old 
represent 41.4 percent of the total veteran population. VA goes on to 
say that the median age of all living veterans today is 60 years old.
    Mr. Chairman, PVA calls upon Congress to enforce and maintain the 
nursing home capacity mandate as outlined in the Millennium Benefits 
and Healthcare Act. This capacity mandate sets a minimum floor of VA 
nursing home care at a critical time in our Nation's history. This is a 
critical point in time because members of America's ``greatest 
generation'' our World War II veterans, desperately require quality 
nursing home care and because of the demand being created today as 
America's newest and most severely wounded heroes are returning from 
Iraq and Afghanistan.
State Veterans Home's Life-Safety Issues
    PVA's testimony has pointed out that State Veterans' Homes have 
been shouldering an increasing share of VA's nursing home care workload 
over the last few years. VA has found it cost-effective to utilize 
State Veterans' Homes because the expense of this care is shared by 
both VA and the States. However, as increased numbers of veterans 
utilize the State Veterans' Homes program VA must accept increased 
responsibility for the up-keep of these facilities. Congress and VA 
must move quickly to provide needed funding to address life-safety 
construction issues that exist in these State Veterans' Homes. The 
Independent Budgetet supports an appropriation that provides $150 
million to correct these
    facility deficiencies. While $150 million does not meet the $250 
million overall cost needed to correct the entire priority-1 life-
safety problem list, it is a good first step toward bringing these 
facilities into a safer condition.
Wiating Lists for VA Non-Institutional Long-Term Care
    PVA is concerned about reports from our members and from VA 
officials that long waiting lists exist for aging veterans who need 
access to VA's non-institutional long-term care programs. Many of VA's 
Home-Based Primary Care programs have extended waiting lists for 
veterans who need the range of services associated with that program. 
Some waiting times are approaching almost a year before a veteran can 
enter the program and receive nursing visits at home. PVA also 
understands that VA's Adult Day Care Program, its Contract Adult Day 
Care Program, and it Homemaker/Home Health Aide Services programs also 
have extended waiting periods for admission.
    These are the types of VA non-institutional long-term care programs 
that can prevent, in many cases, or delay more expensive and more 
restrictive nursing home care. Mr. Chairman, in plain economical terms 
the return on investment related to VA's non-institutional long-term 
care programs is overwhelmingly positive. Additionally, these programs 
are exactly what veterans want. America's aging veterans want to remain 
in their own homes and communities as long as possible. We call on your 
Subcommittee to review the demand, availability and associated waiting 
lists for VA non-institutional long-term care programs and to provide 
the resources necessary to enable VA to expand these valuable programs 
that are favored by veterans.
VA's Care Coordination Program
    VA's Care Coordination/Home Telehealth (CCHT) Program provides a 
range of services designed to help older veterans with chronic 
conditions such as diabetes, heart failure, and Post Traumatic Stress 
Disorder to remain in their own homes and receive non-institutional VA 
care services.
    CCHT is a relatively new VA program that resulted from a VA pilot 
program in VISN 8 between 2000 and 2003. VA implemented its national 
care coordination program in July of 2003. Each veteran patient being 
supported by CCHT has a care coordinator who is usually a nurse 
practitioner, a registered nurse or a social worker. In some complex 
cases physicians coordinate the patients care.
    PVA believes that care coordination is an important element in VA's 
medical service toolkit that can help reduce expensive episodes of 
inpatient hospital care and enable aging veterans with chronic 
conditions to remain in their homes longer than ever before. This 
valuable VA program's reach should be extended and closely linked to 
VA's Geriatric and Extended Care Program to reach additional chronic 
care patients and bring the advantages of modern medical technology to 
their doorstep. VA's strategic plan for long-term care should find ways 
to integrate its CCHT program into a comprehensive mix of services for 
older veterans and veterans with catastrophic disabilities.
Assisted Living
    Assisted Living has proven itself to be a desired alternative to 
nursing home care for many Americans. Consequently, Congress mandated 
that VA, via the Millennium Benefits and Healthcare Act, conduct a 
pilot project to provide assisted living services for veterans. VA did 
so between January of 2003 and June of 2004. The pilot project was 
conducted in VISN-20 and included seven medical centers in four states. 
VA's subsequent report on the project was forwarded to Congress by 
Secretary Principi in November of 2004. The report revealed a number of 
positive findings including information on cost, quality of care and 
veteran satisfaction.
    The Independent Budget has called for the Assisted Living Pilot 
Project to be replicated in at least three VISN's with high 
concentrations of elderly veterans. VA's strategic long-term care plan 
must explore all available programs and services that provide quality 
community-based long-term care. An extension of VA's original assisted 
living project is one of those opportunities.
Conclusion
    Mr. Chairman, PVA believes that one of the most positive moves by 
Congress in recent years has been to require VA to develop a strategic 
long-term care plan. However, for this new VA plan to be a success it 
must have positive and achievable recommendations and provisions for 
accountability. Performance measures, program evaluation, wait times, 
patient satisfaction surveys, and outcome measures are all elements 
that must be used in the development, monitoring and periodic revision 
of a strategic plan for long-term care. PVA believes that VA' strategic 
plan for long-term care must not just be a static, one time, report but 
one that is a living document that receives constant review and up/
dates to be capable of responding to changing veteran needs and 
innovations in long-term care services.
    PVA supports a VA strategic long-term care plan that monitors the 
appropriate balance between non-institutional and institutional long 
term care programs. When periods of projected peak program demand 
exist, VA and Congress must be flexible enough to concentrate resources 
to meet that demand. For example, the growing number of veterans 85 and 
older is well documented and their increased need for nursing home care 
must force VA to maintain adequate levels of nursing home bed space to 
accommodate that need. Correspondingly, when veteran demographics and 
demand shift, resources should follow demand and flow to alternative 
services.
          PVA believes that VA's strategic plan will enable Congress to 
        make better informed decisions regarding the provision of 
        adequate financial resources to support VA care. Additionally, 
        the strategic plan will assist VA's planning and monitoring 
        efforts to ensure appropriate programming, systemwide 
        availability and quality of services. We hope that both your 
        Subcommittee and VA utilize the knowledge and experience of 
        America's Veterans Service Organizations in the development of 
        a strategic plan for VA long-term care.

                                 
          Prepared Statement of Patricia Vandenberg, MHA, BSN
  Assistant Deputy Under Secretary for Health for Policy and Planning
  Veterans Health Administration, U.S. Department of Veterans Affairs
    Mr. Chairman and Members of the Subcommittee, I am pleased to be 
here today, accompanied by James F. Burris, MD, Chief Consultant 
Geriatrics and Extended Care to discuss the strategic direction and 
plan for the future of long term care in the Department of Veterans 
Affairs (VA). I would like to take this opportunity to give an overview 
of VA's long-term care services and programs.
Growing Need For Long-Term Care
    VA has testified previously that there is a great and growing need 
for long-term care services for elderly and disabled veterans. Between 
2005 and 2012, the number of enrolled veterans aged 65 and older is 
projected to increase from 3.45 million to 3.92 million. The number of 
enrolled veterans aged 85 and older will increase from 337,000 to 
741,000 during the same period. This latter group, those aged 85 and 
older, are the most vulnerable of the older veteran population and are 
especially likely to require not only long-term care services, but also 
other healthcare services along the continuum of care such as acute 
care and preventive care.
    VA is addressing the mandates for nursing home care for service-
connected veterans with a disability rated at seventy percent or 
greater and veterans who need nursing home care for their service-
connected disability and for selected home and community based care 
services for all enrolled veterans, as set by Congress in the Veterans 
Millennium Healthcare and Benefits Act, Public Law 106-117, and 
prioritizing care for those veterans most in need of our services 
including:

      veterans returning from Operation Enduring Freedom and 
Operation Iraqi Freedom (OEF/OIF) service,
      veterans with service-connected disabilities,
      veterans with lower incomes, and
      veterans with special healthcare needs such as serious 
chronic mental illness and spinal cord injury and disease

    Since many enrolled veterans are also eligible for long-term care 
through other public and private programs, including Medicare, 
Medicaid, State Veterans Homes, and private insurance, it is in the 
interest of both the government and veterans to coordinate the benefits 
of their various programs and work together toward the goal of 
providing compassionate, and high-quality care. VA staff have extensive 
experience in coordinating services among agencies for the benefit of 
veterans, within statutory limitations and in accordance with desires 
of patients and their families. I want to emphasize that our efforts in 
long-term care case management are driven by the clinical needs of each 
patient, the patient's preferences, and the benefit options available 
to that patient. VA healthcare providers work closely with patients and 
family, on a case-by-case basis, to coordinate the veteran's various 
Federal and State benefits, and to maximize options for that veteran. 
Among those programs within VA that address coordinating veteran care 
needs are Social Work Service, Home Based Primary Care Program, 
community health nurse coordinators, and Care Coordination/Telehealth.
SPECTRUM OF VA LONG-TERM CARE SERVICES
    VA's philosophy of care, in keeping with practice patterns 
throughout the public and private sectors, is to provide patient-
centered long-term care services in the least restrictive setting that 
is suitable for a veteran's medical condition and personal 
circumstances, and whenever possible, in home and community-based 
settings. This approach honors veterans' preferences at the end of life 
and helps to maintain relationships with the veteran's spouse, family, 
friends, faith and community. Nursing home care should be reserved for 
situations in which the veteran can no longer be safely maintained in 
the home and community. VA long-term care is composed of a dynamic 
array of services provided in residential, outpatient, and inpatient 
settings that can be deployed as needed to meet a veteran's changing 
healthcare needs over time. In addition to direct patient care 
services, VA supports important research and education related to the 
healthcare needs of elderly and disabled veterans through the work of 
its 21 Geriatric Research, Education, and Clinical Centers, or GRECCs.
Non-institutional Care Programs
    VA's strategic goal is to make non-institutional long-term care 
services available to every enrolled veteran who needs them and seeks 
them from VA. The spectrum of non-institutional home and community-
based long-term care services supported by VA includes:

      Home Based Primary Care,
      Contract Skilled Home Care,
      Homemaker/Home Health Aide,
      Adult Day Healthcare,
      Home Respite,
      Home Hospice, Spinal Cord Injury Home Care, and
      Care Coordination/Home Telehealth.

    VA also provides quality oversight of care purchased by veterans in 
Community Residential Care and Medical Foster Home facilities through 
an annual review process and monthly or more frequent monitoring by VA 
staff.
    The workload in the non-institutional care programs included in 
Long-Term Care has grown from an average daily census 19,810 in 1998 to 
29,489 through the end of FY 2006. More than 9 out of 10 VA Medical 
Centers now offer some or all of these services, substantially 
enhancing veterans' access to non-institutional long-term care 
services. VA continues to have a VISN performance measure to increase 
the average daily census of veterans receiving home and community-based 
care. Each VISN has been assigned targets for increase in their non-
institutional long-term care workload. VA is expanding both the 
services it provides directly and those it purchases from providers in 
the community.
Care Coordination Initiative/Home Telehealth
    VA expects to meet a substantial part of the growing need for long-
term care through such innovative services as Care Coordination/Home 
Telehealth. Care Coordination in VA involves the use of health 
informatics; telehealth and disease management technologies to enhance 
and extend existing care; and case management activities. VA's national 
Care Coordination initiative commenced in 2003 and is supported by a 
national program office. Care Coordination enables appropriately 
selected veteran patients with chronic conditions such as diabetes and 
congestive heart failure to remain in their own homes, and it defers or 
obviates the need for long-term institutional care. Care Coordination 
services are linked not only with services for the elderly such as Home 
Based Primary Care, but also with other services including Mental 
Health Intensive Case Management and General Primary and Ambulatory 
Care. Care Coordination/Home Telehealth enables delivery of VA 
healthcare to veterans living remotely from VA medical facilities, 
including those in rural areas.
Nursing Home Care
    Inevitably, some veterans will be unable to continue to live safely 
in the community and will require nursing home care. VA will continue 
to provide nursing home care for all veterans for whom such care is 
mandated by statute, who need such care and seek it from VA. In 
addition, VA will continue to provide post-acute care for veterans who 
have suffered an accident or illness such as a broken hip or stroke, 
who require a period of recovery and rehabilitation before returning to 
the community. VA will also continue to provide nursing home care for 
veterans with special needs, including those with spinal cord injury or 
disease, ventilator dependence, and serious chronic mental illness. VA 
expects to sustain existing capacity in its own Nursing Home Care Units 
and in the Community Nursing Home Program and to support continued 
expansion of capacity in the State Veterans Home Program. Transforming 
the culture of care in nursing homes from the traditional medical model 
to a more home-like, patient-centered model is an important initiative 
in all of our nursing home programs.
State Veterans Homes
    VA's State Veterans Home Program assists states in providing care 
to veterans in State Veterans Homes. Veterans' eligibility for each 
state's program is determined by the individual state using the state's 
own criteria. There are State Veterans Homes in operation or under 
construction in all 50 states and Puerto Rico. VA supports construction 
and renovation of State Veterans Homes through the State Home 
Construction Grant Program, which provides matching funds to assist 
states in purchasing, constructing, and renovating properties to serve 
as nursing homes, domiciliaries, and adult day healthcare centers. 
Projects are funded in priority order until available funds for each 
fiscal year are exhausted, with highest priority given to renovation 
projects needed to correct life safety deficiencies and for 
construction of new capacity in geographic areas of need.
    The second component of the State Veterans Home is the Per Diem 
Program. VA pays a per diem to assist the states in providing care for 
eligible veteran residents. Recently, Public Law 109-461, section 211 
provided VA authority to pay State Veterans Homes the prevailing rate 
or the home's daily cost of care, whichever is less, for veterans in 
need of such care for a service-connected disability and for veterans 
who have a service-connected disability rated at 70 percent or more. VA 
is currently in the process of developing regulations to implement the 
provisions of this authority.
    Thirdly, we provide medication at VA expense to eligible veterans 
residing in State Veterans Homes.
    The fourth component of the State Veterans Home program is VA's 
oversight function. VA has developed a system of on-site inspections to 
assure quality of care in State Veterans Homes, including the 
identification of life safety issues.
    The VA Deputy Secretary charged a VA Task Force earlier this year 
to explore opportunities for State Veterans Homes to provide non-
institutional care for veterans. The Task Force solicited the views of 
representatives of the State Veterans Homes and State Departments of 
Veterans Affairs, who indicated that the most important need is to 
lower barriers to their participation in the Adult Day Healthcare 
program. VA will revise the regulations for the State Home Adult Day 
Healthcare program accordingly. Also, VA increases the per diem payment 
for this program annually, which should encourage greater participation 
by the states. VA staff responsible for the State Home Program 
communicate frequently with State Veterans Home and State Department of 
Veterans Affairs personnel to answer questions, share information, and 
solicit stakeholder input on VA policies and programs.
FUTURE NEEDS
    The total FY 2008 budget request for long-term care is $4.6 
billion, of which 90 percent will support institutional services and 10 
percent non-institutional home and community-based care. This request 
will provide the resources necessary for VA to strengthen our position 
as a leader in providing high-quality services for a growing population 
of elderly and disabled veterans, as well as those veterans returning 
from service in OEF/OIF, veterans with service-connected disabilities, 
veterans with lower incomes, and veterans with special healthcare 
needs.
    As you know, the population of veterans who are enrolled for 
healthcare in the VA are, on average, older, poorer, and sicker than 
the general population. VA is already seeing the kinds of demographic 
changes that are projected for the nation as a whole in coming decades. 
Recently, VA has also begun to care for younger veterans who have 
sustained polytraumatic injuries during their service in Operation 
Enduring Freedom and Operation Iraqi Freedom. While the number of 
seriously disabled OEF/OIF veterans is relatively small, compared to 
the total number of veterans requiring extended care services, the 
complexity of care they require is high and their personal and social 
needs differ from those of older veterans. VA is moving to adapt its 
long-term care services to meet the needs of all veterans.
    Many returning veterans are presenting with multiple and severe 
disabilities including speech, hearing and visual impairment as well as 
loss of limbs and brain injuries, and behavioral issues due to the 
stress of combat. In addition, they have families, including children, 
who want to be actively involved in their care. Unlike other cohorts of 
veterans in long-term care, this cohort thrives on independence, is 
physically strong, and is part of a generation socialized differently 
than their older counterparts. These generational differences pose 
unique challenges in the institutional and long-term care environment.
    VA is taking measures to first recognize the generational 
differences of this population and incorporate them into the care 
routines. For example, in VA nursing homes, transforming the culture of 
care to make the living space more home friendly is important, as is 
having an ``Internet cafe'', computer games, or age appropriate music 
and videos available for nursing home residents. Allowing for family, 
especially children, to visit and perhaps even stay over when needed is 
another example of accommodating generational differences. 
Personalizing care routines such as bathing and dining times and 
offering food items that are palatable to younger persons are examples 
of the changes that are occurring in long-term care.
Conclusion
    VA takes great pride in our accomplishments, and looks forward to 
working with the members of this Subcommittee to continue the 
Department's tradition of providing timely, high-quality healthcare to 
those who have helped defend and preserve freedom around the world.
    Mr. Chairman, this completes my statement. I will be happy to 
address any questions that you and other Members of the Subcommittee 
may have.

                                 
              Statement of American Healthcare Association
    On behalf of the nearly 11,000 long term care facilities 
represented by the American Healthcare Association (AHCA), we salute 
the Veterans' Affairs Committee for not only recognizing the needs of 
America's frail, elderly, and disabled veterans, but also for 
continually seeking to optimize the quality of their care in the face 
of substantial budgetary and demographic challenges.
    In light of the increasing number of aging baby boomer veterans now 
seeking to access VA healthcare services, the increased care needs for 
older veterans already enrolled, and younger wounded veterans now in 
need of care, we recognize and are extremely sympathetic to the fact 
the VA's resource base and capacity are stretched to the maximum limit, 
and then some.
    Consequently, it may not have the resources to address the existing 
and projected needs for skilled nursing and rehabilitative care--
especially in light of the type and nature of injuries being sustained 
in Iraq and Afghanistan. From this important standpoint, Mr. Chairman, 
we want to support the VA's essential mission one hundred percent--not 
somehow impede or supplant it in a manner that prevents our returning 
heroes from receiving the best care our grateful nation has to offer. 
Our nation's community nursing homes (CNHs) stand ready to help 
veterans and the VA through this crisis.
    CNHs are a vital component of the VA long term care system. Whereas 
VA medical facilities tend to provide care to residents with high 
acuity levels, CNHs are an excellent choice for veterans who either 
have acuity levels that do not warrant placement in a VA facility, but 
are too high for home healthcare--or for veterans who would be too far 
from their families if placed in one of their state's VA Medical 
Facilities or State Veterans Nursing Homes. In 2006, over 13 percent of 
all veterans receiving nursing home care were in CNHs. That percentage 
should increase, given the VA's stated plan in the FY 2008 Budget 
Submission to focus its long term care efforts on the ``best setting 
for the [veteran] . . . and providing that care closer to where the 
veteran lives.'' Given that there is a skilled nursing facility in 
almost every county in the nation, AHCA remains ready to help the VA 
continue providing high quality, clinically appropriate long term care 
to our Nation's veterans through CNH placements.
    By 2012, there are expected to be approximately 1.3 million 
veterans over 85 years of age, and it is imperative that we work 
together to insure that both the veteran and civilian populations 
receive the best possible care, and that one population should not 
receive care at the expense of another.
    One key issue negatively impacting our ability to serve veterans 
and others in need of long term care is the ongoing staffing crisis, 
and we need to ensure that we do not compete against one another for 
the shrinking pool of qualified workers who serve as the backbone of 
our Nation's long term care system. In that context, we should 
fundamentally reevaluate elements of the Veteran's Millennium 
Healthcare and Benefits Act 1999--which established new standards for 
evaluating a state's need for constructing new facilities for veterans.
    Specifically, the methodology for establishing the need for new 
veterans' beds does not take into account the number of available 
community nursing home (CNH) beds in each state--beds immediately 
available, and which may be far closer to home. CNHs provide the option 
of living closer to one's family while receiving health benefits from 
the VA. As we all know, proximity to loved ones is critical in 
maintaining quality of life for any nursing home resident.
    For the record, Mr. Chairman, AHCA does not discourage in any way 
funding necessary improvements to veteran's homes. But we ask that 
prior to appropriating millions in construction costs for additional 
facilities, the VA should work to determine whether there are existing 
quality facilities in proximity to the proposed new homes that could 
otherwise provide high quality care.
    In an era of limited resources, especially at the VA, we should as 
a matter of intelligent public policy work to provide care in homes 
that currently exist, rather than constructing new facilities that, 
again, compete for staff and weaken our Nation's entire long term care 
infrastructure.
    AHCA looks forward to working with you, Mr. Chairman, and the rest 
of the Committee, in examining this issue in greater detail going 
forward. Our members are proud to serve America's veterans in their 
time of need and we look forward to working with the Committee and the 
Department to continue doing so in the future.
    Thank you again Mr. Chairman, and Members of this Committee, for 
holding this important hearing. With our Nation's soldiers and veterans 
in both the national and international spotlight, our concern for their 
care and safety today as well as tomorrow has never been more important 
to the soul and conscience of the American people. They deserve the 
best we have to offer.

                                 
         Statement of American Occupational Therapy Association
    The American Occupational Therapy Association (AOTA) submits this 
statement for the record of the May 9, 2007 hearing. We appreciate the 
opportunity to provide this information regarding the use of 
occupational therapy in long-term care in the Department of Veteran 
Affair's long-term care programs. With the aging of our Nation's 
veterans, quality long-term care programs to assist those who are in 
need should be a priority for our country. Occupational therapists and 
occupational therapy assistants work in long-term care settings, 
including home and community based settings, to increase the 
independence and quality of life of their patients.
    AOTA is the nationally recognized professional association of 
35,000 occupational therapists, occupational therapy assistants, and 
students of occupational therapy. Occupational therapy is a health, 
wellness, and rehabilitation profession working with people 
experiencing stroke, spinal cord injuries, cancer, congenital 
conditions, developmental delay, mental illness, and other conditions. 
It helps people regain, develop, and build skills that are essential 
for independent functioning, health, and well-being. Occupational 
therapy is provided in a wide range of settings including daycare, 
schools, hospitals, skilled nursing facilities, home health, outpatient 
rehabilitation clinics, psychiatric facilities, and community programs.
    Occupational therapy professionals assist those with traumatic 
injuries--young and old alike--to return to active, satisfying lives by 
showing survivors new ways to perform activities of daily living, 
including how to dress, eat, bathe, cook, do laundry, drive, and work. 
It helps older people with common problems like stroke, arthritis, hip 
fractures and replacements, and cognitive problems like dementia. In 
addition, occupational therapists work with individuals with chronic 
disabilities including mental retardation, cerebral palsy, and mental 
illness to assist them to live productive lives. Occupational therapy 
practitioners also provide care to veterans who suffer from traumatic 
brain injuries, post-traumatic stress disorder, spinal cord injuries, 
and other conditions. By providing strategies for doing work and home 
tasks, maintaining mobility, and continuing self-care, occupational 
therapy professionals can improve quality of life, speed healing, 
reduce the chance of further injury, and promote productivity and 
community participation for veterans.
    The Department of Veterans Affairs (VA) offers a spectrum of 
geriatric and extended care services to veterans enrolled in its 
healthcare system. More than 90 percent of VA's medical centers provide 
home- and community-based outpatient long-term care programs. This 
patient-focused approach supports the wishes of most patients to live 
at home in their own communities for as long as possible. In addition, 
nearly 65,000 veterans will receive inpatient long-term care this year 
through programs of VA or state veteran's homes.
Occupational Therapy's Role for veterans in Long-term Care Programs
    Occupational therapy practitioners provide care in a number of 
settings and programs, including both institutional and non-
institutional programs. Veterans long-term care programs include 
options to receive care in the home and community as well as in nursing 
homes. Regardless of setting or program, it is proven that elderly 
individuals benefit from occupational therapy services [Journal of the 
American Medical Association (JAMA) ``Occupational therapy for 
independent-living older adults: A randomized controlled trail.'' JAMA, 
Vol. 278, No. 16, p. 1321-1326. 1997]. Occupational therapy 
practitioners can provide a unique and valuable service in supporting 
veterans in long-term care programs, in their occupations and 
activities of daily living, and in their efforts to remain independent 
and to successfully age in place.
    Activities of Daily Living (ADLs) are basic self-care activities 
that need to be completed on a daily basis (for example self-feeding, 
grooming, bathing, dressing, and toileting). Instrumental activities of 
daily living (IADLs) such as reading and managing money are also 
critical. Occupational therapy practitioners work with veterans to gain 
the skills that are needed to accomplish their ADLs and pursue IADLs as 
appropriate. Occupational therapists and occupational therapy 
assistants are experts at identifying the causes of difficulties 
limiting participation. Their expertise enables them to consider client 
needs and environmental factors to develop effective strategies that 
will maximize quality of life as well as independence in those daily 
activities that are important to each Veteran.
    Veterans who wish to age in place in their home or community look 
toward occupational therapy as a means to achieve their goals. 
Occupational therapy plays a key role in identifying strategies that 
enable individuals to modify their homes and environment to meet their 
goal of aging in place at home and in the community. Aging in place 
refers to the ability to remain in the home even if the client's 
abilities have declined.
    Home modifications are adaptations to living environments intended 
to increase usage, safety, security, and independence for the user. As 
part of the home modification process, occupational therapy services 
include assessing needs, identifying solutions, implanting solutions, 
training in the use of solutions, and evaluating outcomes that 
contribute to the home modification product. Occupational therapy 
practitioners may recommend the installation of chair lifts for stairs 
or adding railings or grab bars to bathrooms or other walls to provide 
support. Occupational therapy practitioners can enhance Veteran's well-
being and participation by serving as a resource in home modification.
    Occupational therapy is also recommended to help keep individuals 
mobile and independent, helping to ensure meaningful participation in 
the community. For some people, some forms of transportation, such as 
driving, become less safe, and many veterans will need to address 
alternatives to driving at some point in their lives. Occupational 
therapy can optimize and prolong an older driver's ability to drive 
safely, and ease the transition to other forms of transportation if 
driving cessation becomes necessary. By identifying strengths as well 
as physical and cognitive challenges, occupational therapists can 
evaluate an individual's overall ability to operate a vehicle safely 
and recommend assistive devices or behavioral changes to limit risks. 
The goal of assessing individuals for driving is to enable them to stay 
in the community and reduce the need for nursing home care.
    Veterans who receive care in nursing homes also benefit from 
occupational therapy services. Occupational therapy starts where the 
person is, looks at their desires and potential, and facilitates 
diminishment of frailties and support of abilities. As veterans are 
treated in nursing homes, their needs range widely. Occupational 
therapy is there to assist and enable them to overcome or heal from 
disability and illness. It is a critical component to achieving quality 
of life which is the goal of the Veteran Affair's long-term care 
programs. The veteran population will continue to grow and nursing 
homes will remain an important site of care for veteran's who require 
constant nursing care and have significant deficiencies with activities 
of daily living.
    People in the United States are living longer, and that includes 
our Nation's veterans. For some, a consequence of increased longevity 
is increased frailty and dependency. Many veterans live alone, have 
limited resources, and require special services for meeting everyday 
needs. Helping elderly persons to maximize their independence and 
enabling them to continue to perform activities of daily living is 
crucial. The Department of Veterans Affairs long-term care programs are 
structured to provide care to our country's veterans as they age and 
need help with various areas of their lives. Occupational therapy is a 
unique and valuable service that can help veterans achieve their goals 
of living a healthy and independent life.
    AOTA hopes that Congress will continue to look at occupational 
therapy as a service that benefits all Americans. We look forward to 
discussing how we can better serve our Nation's veterans and all aging 
Americans.
    Contact: Daniel R. Jones

                                 
   Statement of Kimo S. Hollingsworth, National Legislative Director 
                       American Veterans (AMVETS)
    Mr. Chairman and Members of the Subcommittee:
    I am pleased to offer testimony on behalf of American veterans 
(AMVETS) regarding the Department of Veterans Affairs long-term care 
program.
    The Department of Veterans Affairs (VA) offers a fairly robust 
variety of inpatient long-term care services for veterans enrolled in 
the VA healthcare system. VA services are generally divided into non-
institutional care and institutional care. More than 90 percent of VA 
medical centers provide home and community-based outpatient long-term 
care programs. Overall, eligible veterans can receive home-based 
primary care, contract home healthcare, adult day healthcare, homemaker 
and home health aide services, home respite care, home hospice care and 
community residential care. In addition, VA nursing home programs 
include VA-operated nursing home care units, contract community nursing 
homes and state homes.
    As this Committee is aware, AMVETS hosted the ``National Symposium 
for the Needs of Young Veterans'' in Chicago, Illinois last year. More 
than 500 veterans, active duty and National Guard and reserve 
personnel, family members, and others who care for veterans examined 
the growing needs of our returning veterans. One of they Symposium 
findings revealed a general lack of knowledge about VA long-term care 
programs among veterans and their family members.
    Mr. Chairman, the changing dynamics within the enrollee population, 
such as aging, changes in morbidity, and VA enrollees shifting to a 
higher cost priority level will continue to impact medical care 
expenditures. In testimony before the House Committee on 
Appropriations, VA recently reported, ``that there is a great and 
growing need for long-term care services for elderly and disabled 
veterans.'' VA projects that between 2005 and 2012, the number of 
enrolled veterans aged 65 and will increase from 3.45 million to 3.92 
million, and the number of enrolled veterans aged 85 and older will 
increase from 337,000 to 741,000 during the same period. The latter 
group will most likely require long-term care services and other 
healthcare services along the continuum of care such as acute care and 
preventive care.
    Public Law 106-117 mandated that VA prioritize care for those 
veterans most in need of VA services, to include veterans returning 
from OEF/OIF service, veterans with service-connected disabilities, 
those with lower incomes, and veterans with special healthcare needs 
such as serious chronic mental illness and spinal cord injury and 
disease. It is within the guidelines of this mandate that VA is 
currently focused. AMVETS reaffirms its commitment that service-
disabled veterans should have the highest priority access to VA 
healthcare services and these services should be of the highest 
quality. AMVETS believes that service-connected veterans currently have 
that level of access and quality in VA today.
    In 2004, VA commissioned a study on VA Long-Term Care Patients' 
Medicare and Medicaid Expenditures. The study concluded that three 
quarters of VA long-term care patients rely to some extent on the 
national Medicare and Medicaid programs. The study also found that VA 
funds approximately 90 percent of the care provided for these veterans. 
Given these dynamics of cross enrollment, AMVETS believes that it is in 
the interest of both the government and veterans to coordinate the 
benefits of their various programs and work together toward the goal of 
providing compassionate, and high-quality care.
    Overall, the Veterans Health Administration's efforts in long-term 
care case management are driven by the clinical needs of each patient, 
the patient's preferences, and the benefit options available to that 
patient. As part of this process, VA healthcare providers work closely 
with patients and family to ensure veterans receive appropriate care. 
Despite VA's best efforts to coordinate care through its many programs 
and with other federal, state and private organizations, the cost of 
long-term care is expensive and continues to rapidly increase.
    To VA's credit, the department has effectively managed its 
healthcare expenditures and it provides a significant dollar cost value 
compared to other Federal and private programs. From 1996 through 2004, 
the Medical Consumer price index increased by approximately 40 percent. 
During this same period, the average Medicare cost per payment per 
enrollee increased by almost 45 percent. The VA cost per patient during 
this same time period increased less than 1 percent, yet VA customer 
service and satisfaction ratings have increased. Ultimately, good 
business practices make sense, but VA is in the people business and 
taking care of veterans remains paramount. VA has done both!
    AMVETS will continue to support VA long-term care programs and 
believes that the department continues to set the standard for 
excellence in care and dollar cost value per patient. AMVETS would 
continue to urge Congress to support VA long-term care programs and 
seriously consider allowing VA to recoup Medicare and Medicaid 
reimbursements as a way to save money for the Federal Government.
    Mr. Chairman, this concludes my testimony.

                                 
                     Statement of Hon. Jeff Miller
           Ranking Republican Member, Subcommittee on Health
    Thank you, Mr. Chairman. I appreciate having this important hearing 
to look at the performance of the Department of Veterans Affairs (VA) 
in meeting the existing long-term care needs of our disabled and aging 
veterans and assess the Department's strategy for addressing long-term 
care challenges in the future.
    The number of enrolled veterans most in need of long-term care 
services, those 85 years and older, will dramatically increase by the 
year 2012, growing from 337,000 to 741,000 veterans, a 120 percent 
increase. In addition to a large elderly veteran population, VA is 
facing a new demographic of veterans who are limited in their capacity 
to care for themselves due to multi-trauma injuries incurred during the 
Global War on Terror. It is vital that the generational differences of 
these young veterans be taken into consideration and that VA provides 
age-appropriate services in the right setting.
    In 2003, 2004, 2005 and 2006 the government Accountability Office 
analyzed various aspects of VA's long-term care programs at both the 
House and Senate Committees' direction. It is of great concern that in 
these GAO reviews, we continue to find that access to a complete 
continuum of VA long-term care services remains markedly variable from 
network to network.
    VA's lack of a reliable long-term care planning model not only led 
to a glaring gap in the Capital Asset Realignment for Enhanced Services 
(CARES) plan, but was also a major factor in the budget formulation 
problems this Committee uncovered in 2005. For more than five years, VA 
has been promising to adopt a strategic plan for long-term care, but 
has failed to establish one. Last year, in Public Law 109-461, Congress 
showed its resolve by requiring VA to publish a strategic plan for the 
provision of long-term care not later than 180 days after enactment of 
the law. Let me put VA on notice that the date is near and we expect VA 
to submit that plan in mid-June, on time, with no excuses.
    I want to also remind all of us that the way VA delivers long-term 
care very deeply affects each individual veteran patient and their 
families. Important to enhancing a veteran patient's quality of life is 
ensuring that care is provided in the least restrictive setting and 
that the personal dignity and emotional well-being of the patient is 
the top priority. In this regard, I am a strong advocate for supporting 
new and innovative programs to meet these needs.
    I look forward to the testimony our witnesses will provide today to 
assist us in confronting the unresolved issues related to meeting the 
long-term care needs of all our veterans and improving the management 
and direction of VA's long-term care mission.
    Thank you Mr. Chairman, I yield back.



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