[House Hearing, 111 Congress]
[From the U.S. Government Publishing Office]
ASSESSING CAPITAL ASSET REALIGNMENT
FOR ENHANCED SERVICES AND THE FUTURE
OF THE U.S. DEPARTMENT OF VETERANS
AFFAIRS' HEALTH INFRASTRUCTURE
=======================================================================
HEARING
before the
SUBCOMMITTEE ON HEALTH
of the
COMMITTEE ON VETERANS' AFFAIRS
U.S. HOUSE OF REPRESENTATIVES
ONE HUNDRED ELEVENTH CONGRESS
FIRST SESSION
__________
JUNE 9, 2009
__________
Serial No. 111-27
__________
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 HENRY E. BROWN, Jr., South
Dakota Carolina
HARRY E. MITCHELL, Arizona JEFF MILLER, Florida
JOHN J. HALL, New York JOHN BOOZMAN, Arkansas
DEBORAH L. HALVORSON, Illinois BRIAN P. BILBRAY, California
THOMAS S.P. PERRIELLO, Virginia DOUG LAMBORN, Colorado
HARRY TEAGUE, New Mexico GUS M. BILIRAKIS, Florida
CIRO D. RODRIGUEZ, Texas VERN BUCHANAN, Florida
JOE DONNELLY, Indiana DAVID P. ROE, Tennessee
JERRY McNERNEY, California
ZACHARY T. SPACE, Ohio
TIMOTHY J. WALZ, Minnesota
JOHN H. ADLER, New Jersey
ANN KIRKPATRICK, Arizona
GLENN C. NYE, Virginia
Malcom A. Shorter, Staff Director
______
Subcommittee on Health
MICHAEL H. MICHAUD, Maine, Chairman
CORRINE BROWN, Florida HENRY E. BROWN, Jr., South
VIC SNYDER, Arkansas Carolina, Ranking
HARRY TEAGUE, New Mexico CLIFF STEARNS, Florida
CIRO D. RODRIGUEZ, Texas JERRY MORAN, Kansas
JOE DONNELLY, Indiana JOHN BOOZMAN, Arkansas
JERRY McNERNEY, California GUS M. BILIRAKIS, Florida
GLENN C. NYE, Virginia VERN BUCHANAN, Florida
DEBORAH L. HALVORSON, Illinois
THOMAS S.P. PERRIELLO, Virginia
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
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further refined.
C O N T E N T S
__________
June 9, 2009
Page
Assessing Capital Asset Realignment for Enhanced Services and the
Future of the U.S. Department of Veterans Affairs' Health
Infrastructure................................................. 1
OPENING STATEMENTS
Chairman Michael Michaud......................................... 1
Prepared statement of Chairman Michaud....................... 51
Hon. Henry E. Brown, Jr., Ranking Republican Member.............. 2
Prepared statement of Congressman Brown...................... 51
WITNESSES
U.S. Department of Veterans Affairs:
Hon. Everett Alvarez, Jr., Chairman, Capital Asset
Realignment for Enhanced Services Commission............... 29
Prepared statement of Hon. Alvarez....................... 70
Donald H. Orndoff, AIA, Director, Office of Construction and
Facilities Management...................................... 38
Prepared statement of Mr. Orndoff........................ 82
U.S. Government Accountability Office, Mark L. Goldstein,
Director, Physical Infrastructure.............................. 31
Prepared statement of Mr. Goldstein.......................... 73
______
American Legion, Joseph L. Wilson, Deputy Director, Veterans
Affairs and Rehabilitation Commission.......................... 3
Prepared statement of Mr. Wilson............................. 52
Disabled American Veterans, Joy J. Ilem, Assistant National
Legislative Director........................................... 11
Prepared statement of Ms. Ilem............................... 62
Paralyzed Veterans of America, Carl Blake, National Legislative
Director....................................................... 5
Prepared statement of Mr. Blake.............................. 54
Veterans of Foreign Wars of the United States, Dennis M.
Cullinan, Director, National Legislative Service............... 7
Prepared statement of Mr. Cullinan........................... 57
Vietnam Veterans of America, Richard F. Weidman, Executive
Director for Policy and Government Affairs..................... 9
Prepared statement of Mr. Weidman............................ 60
MATERIAL SUBMITTED FOR THE RECORD
Post-Hearing Questions and Responses for the Record:
Hon. Michael H. Michaud, Chairman, Subcommittee on Health,
Committee on Veterans' Affairs, to Hon. Eric K. Shinseki,
Secretary, U.S. Department of Veterans Affairs, letter
dated June 18, 2009, including questions from Hon. Joe
Donnelly, and VA responses................................. 85
ASSESSING CAPITAL ASSET REALIGNMENT
FOR ENHANCED SERVICES AND THE FUTURE
OF THE U.S. DEPARTMENT OF VETERANS
AFFAIRS' HEALTH INFRASTRUCTURE
----------
THURSDAY, JUNE 9, 2009
U.S. House of Representatives,
Committee on Veterans' Affairs,
Subcommittee on Health,
Washington, DC.
The Subcommittee met, pursuant to notice, at 10:09 a.m., in
Room 334, Cannon House Office Building, Hon. Michael Michaud
[Chairman of the Subcommittee] presiding.
Present: Representatives Michaud, Teague, Halvorson,
Perriello, Brown of South Carolina, Boozman, and Bilirakis.
OPENING STATEMENT OF CHAIRMAN MICHAUD
Mr. Michaud. I call the Subcommittee on Health to order and
while we are giving our opening remarks, I would ask the first
panel to come forward.
I would like to thank everyone for attending this morning's
hearing. Today's hearing marks the fifth anniversary of the
CARES decision, otherwise known as the Capital Asset
Realignment for Enhanced Services.
The purpose of this hearing is to assess the U.S.
Department of Veterans Affairs' (VA's) implementation of CARES
and to investigate the effectiveness of CARES as a capital
planning tool.
In addition, today's hearing will explore whether CARES
should continue in the future or if the VA should adapt to an
alternative capital planning mechanism.
When the VA embarked on the CARES process 5 years ago, over
5 years actually, the VA's health infrastructure was thought to
be unresponsive to the needs of current and future veterans.
While about 24 percent of the veterans' population was
enrolled in the VA for health care, the CARES plan assumed the
enrollment population would increase to 33 percent by the end
of 2022.
In addition, there were concerns about the ability of the
existing health care infrastructure to meet the demand of the
aging veteran
population who opt for warmer climates in the south and southwes
t.
CARES was intended to eliminate or downsize unused
facilities, convert older, massive hospitals to more efficient
clinics, and build hospitals where they are needed in more
populated areas. In essence, CARES was to direct resources in a
sensible way to increase access to care for many veterans and
to improve the efficiency of health care operations across the
VA facilities.
Over the years, there have been challenges of implementing
the CARES decision in numerous locations. Most notably, the VA
actually has reversed the CARES decision under the leadership
of different VA Secretaries.
Too often we hear stories of veterans who have been waiting
for new facilities for over 10 or more years.
In addition, there is a new concept of health care centers,
which provide primary and specialty care and is a hybrid of a
Community-Based Outpatient Clinic (CBOC) and full-fledged
hospital. Because this is a relatively new concept the VA is
rolling out, it is important that we fully understand how it
fits into the overall CARES plan.
I look forward to hearing the testimony of our panels today
as we determine the path forward to continue to build a strong
health infrastructure for the VA system.
One of the reasons why this Committee continues to receive
legislation dealing with contracting out VA health care
services is because VA has not moved as aggressively as we
would like to see them move forward under the CARES process.
Hence, Members of Congress are concerned and they are trying to
do what they can to make sure that veterans in their State have
access to that health care that they need to take care of their
needs.
I would now like to recognize Ranking Member Brown for an
opening statement that he may have.
[The prepared statement of Chairman Michaud appears on p. 51
.]
OPENING STATEMENT OF HON. HENRY E. BROWN, JR.
Mr. Brown of South Carolina. Thank you, Mr. Chairman, and
thanks to the panel for coming and sharing their knowledge with
us this morning.
Today, more than 80 percent of the primary, specialty, and
mental health care of our veterans' needs can be provided in an
outpatient setting. Yet, much of the Department of Veterans
Affairs' health care infrastructure was built more than 50
years ago when VA care meant hospital care.
A review of VA's real property by the U.S. Government
Accountability Office (GAO) in 1999 found that VA was wasting a
million dollars a day on the maintenance of outdated and
underutilized health care facilities.
In response to this report and in recognition of the need
to update facilities to deliver 21st century health care, VA
established the Capital Asset Realignment for Enhancement
Services (CARES) process.
CARES was designed to be the capital planning blueprint for
the future, to modernize and better align VA health care
facilities for the changing veterans' population.
The CARES Commission identified several ways to improve
access and enhance quality of care, including increased
collaboration and partnership with the U.S. Department of
Defense (DoD) and VA's academic affiliates.
Specifically, in my home State of South Carolina, the CARES
Commission supported a concept for a joint venture with the
Medical University of South Carolina and the Ralph H. Johnson
VA medical center in Charleston.
The Secretary's May 2004 CARES decision also stated that VA
will continue to consider options for sharing opportunities
with the Medical University of South Carolina.
Since the leadership of the Medical University came to VA
with this proposal more than 6 years ago, I and this Committee
have taken significant steps to study and move forward with
this historic opportunity to establish a new innovative model
of care.
The ``Charleston Model'' would ensure high-quality health
care for veterans in the Charleston area and could be leveraged
to improve access to care in other areas.
A significant milestone was reached in advancing the
project with the passage of Public Law 109-461, the Veterans
Benefit Health Care and Information Technology Act of 2006.
Section 804 of this law authorized $36.8 million for VA to
enter into an agreement with the Medical University to design,
construct, and operate a collocated, joint-use medical facility
in Charleston, South Carolina. However, much to my dismay, the
VA has not yet set aside any funding to implement the law.
As we evaluate the effectiveness of CARES, it is also vital
that we reevaluate the importance of collaborative
partnerships. Building on the close relationships that VA
already has with medical schools across the Nation is a
powerful tool that VA can use to achieve greater health care
quality and further efficiencies while still preserving the
identify of a veterans' health care system.
I look forward to our discussion today and yield back the
balance of the time.
[The prepared statement of Congressman Brown appears on
p. 51.]
Mr. Michaud. Thank you, Mr. Brown.
I would like to recognize the individuals on panel one:
Joseph Wilson, who is with the American Legion; Carl Blake, the
Paralyzed Veterans of America (PVA); Dennis Cullinan, who is
with the Veterans of Foreign Wars of the United States (VFW);
Rick Weidman, who is with the Vietnam Veterans of America
(VVA); and Joy Ilem, the Disabled American Veterans (DAV).
So I want to thank all of you for coming here this morning.
Look forward to your testimony. And we will start with Mr.
Wilson.
STATEMENTS OF JOSEPH L. WILSON, DEPUTY DIRECTOR, VETERANS
AFFAIRS AND REHABILITATION COMMISSION, AMERICAN LEGION; CARL
BLAKE, NATIONAL LEGISLATIVE DIRECTOR, PARALYZED VETERANS OF
AMERICA; DENNIS M. CULLINAN, DIRECTOR, NATIONAL LEGISLATIVE
SERVICE, VETERANS OF FOREIGN WARS OF THE UNITED STATES; RICHARD
F. WEIDMAN, EXECUTIVE DIRECTOR FOR POLICY AND GOVERNMENT
AFFAIRS, VIETNAM VETERANS OF AMERICA; AND JOY J. ILEM,
ASSISTANT NATIONAL LEGISLATIVE DIRECTOR, DISABLED AMERICAN
VETERANS
STATEMENT OF JOSEPH L. WILSON
Mr. Wilson. Good morning, Mr. Chairman and Members of the
Subcommittee. Thank you for this opportunity to present the
American Legion's views on the future of the Department of
Veterans Affairs' infrastructure.
It is the American Legion's position that Congress keep in
mind the importance of continuity of care during a
servicemember's transition from active duty to the community.
Within the VA medical system are various divisions that
accommodate a high demand of services.
In 2004, the VA completed the Capital Asset Realignment for
Enhanced Services or CARES process, which called for the
critical construction needs for outdated VA hospitals and
clinics throughout the Nation, throughout the VA system.
The Secretary of VA reported Congress would have to include
$1 billion annually for 6 years to ensure the success of CARES.
The American Legion has recommended the same figure in its
annual budget recommendation since the CARES decision.
Due to lack of funding over the years, it is believed VA
has been playing fiscal catch-up. Although the VA had begun
implementing CARES decisions, a Government Accountability
Office or GAO report found implementation was not being
centrally tracked or monitored to determine the impact the
CARES process has or has not had on the mission.
GAO was also tasked with examining how CARES contributes to
the Veterans Health Administration (VHA) capital planning
process, the extent to which the CARES process considered
capital asset alignment alternatives and the extent to which VA
had implemented CARES decisions and how the application has
helped VA carry out its mission.
Through CARES, the VA developed a model to estimate the
demand for health care services as well as ascertained the
capacity or availability of infrastructure to meet the demand.
It was the recommendation of the VA to meet future health care
demand by building medical facilities and opening more
community-based outpatient clinics or CBOCs.
GAO further examined the CARES process by other means such
as conducting six site visits to VA facilities in Walla Walla;
El Paso; Big Spring, Texas; Orlando, Florida; Pittsburgh,
Pennsylvania; and Los Angeles, California, but they found
critical infrastructure problems at the following facilities,
Walla Walla, greater Los Angeles, Orlando, and Pittsburgh.
As a result of the GAO report, it was recommended that VA
provide the information necessary to monitor the implementation
and impact of CARES decisions.
It was also recommended VA provide outcome measures that
report the progress of CARES as it relates to access to medical
services for veterans.
Since fiscal year 2002, approximately 945,000 Operation
Enduring Freedom/Operation Iraqi Freedom (OEF/OIF) veterans
have left active duty and become eligible for VA health care.
Approximately 51 percent of the returnees were active duty
while 49 percent were Reserve and National Guard. Many are also
returning with various injuries and illnesses to include
traumatic brain injury (TBI), spinal cord injury (SCI), blind
eye injury, post-traumatic stress disorder (PTSD), and loss of
limbs to name a few.
The American Legion presents the above-mentioned numbers to
evoke to the Congress and other pertinent stakeholders to
determine the adequacy or lack thereof of care to veterans when
there is lack of funding and/or inadequate accommodations,
namely infrastructure that houses VA services.
While the decision to assess and plan and construct or
reconstruct VA medical facilities has been underway since the
CARES decision in 2004, the aforementioned figures also suggest
veterans' issues have and continue to increase.
With the average age of VA facilities remaining at 49
years, the American Legion questions whether these facilities
can sustain new medical technology for years to come. During
that time, we must remain conscious that veterans' issues are
patterned to rise. It is, therefore, imperative Congress
support the demand for timely construction of these facilities.
It is the position of the American Legion that during the
improvement/enhancement of VA facilities, a base of health care
services must not only be maintained but must be increased to
accommodate influxes.
In order for the CARES plan to work successfully, there
must be adequate funding to accommodate every project as
implemented by the Commission. To play fiscal catch-up from
this point would adversely affect the intent of the CARES
project or VA infrastructure and all veterans who rely on VA
health care.
The American Legion also supports the mission of the CARES
initiative if it provides a continuous, up-to-date
infrastructure for an ever-changing veterans' community.
However, we express descent and concern if the intent is aimed
at the effort to reduce VA expenditures under the pretext of
cost savings without regard to the needs of the veterans'
population.
Finally, the preparation to construct and/or reconstruct VA
medical facilities must be planned in accordance with service
alignment decisions to fulfill the promise of continuity of
care and prevent other inadequacies such as fragmentation of
care throughout the women veterans' population.
The American Legion maintains that the CARES implementation
process must be an open and transparent process that
continually and fully informs the veterans service
organizations (VSOs) of CARES initiatives, criteria proposals,
and timeframes.
This also includes an accurate assessment of the demand for
all medical services which gauges how much infrastructure is
required to accommodate this Nation's veterans.
Through this form of checks and balances, the maintenance
of quality stands to uphold the effectiveness of CARES as it
pertains to strategic planning and the future of the entire VA
system.
Mr. Chairman and Members of the Subcommittee, the American
Legion sincerely appreciates the opportunity to submit
testimony. Thank you.
[The prepared statement of Mr. Wilson appears on p. 52.]
Mr. Michaud. Thank you, Mr. Wilson.
Mr. Blake.
STATEMENT OF CARL BLAKE
Mr. Blake. Chairman Michaud and Ranking Member Brown, on
behalf of Paralyzed Veterans of America, I would like to thank
you for the opportunity to testify today.
I will limit my comments to CARES recommendations as they
directly impacted care for spinal cord injured veterans and
veterans with spinal cord dysfunction.
In reflecting on the CARES report, we believe that the
health care concerns of veterans with catastrophic disabilities
and particularly veterans with spinal cord injury or
dysfunction (SCI/D) were adequately addressed.
Emphasis was placed on expansion of the SCI hub-and-spoke
delivery model to fill geographic gaps in SCI/D services.
Specifically the CARES Commission called for the construction
of four new SCI centers in the VA system. Those locations were
targeted for new centers in Syracuse, New York, Veterans
Integrated Services Network (VISN) 2; VISN 16, which was later
pinpointed to Jackson, Mississippi, by the VA and PVA
officials; Denver, Colorado located in VISN 19; and
Minneapolis, Minnesota, which was previously in VISN 23.
With regards to Denver, the Subcommittee is probably aware
that it has been a long and difficult process to determine what
the health care infrastructure plan for this region would be.
The CARES planning called for a 30-bed SCI center to be located
at a new Denver VA medical center to be built on the Fitzsimons
Campus. However, the larger facility planning process moved
forward in bits and starts.
The plan for Denver has taken many controversial turns
spread out over many years with no plan being more troublesome
than the new plan that was released in early 2008 by then VA
Secretary Peake.
Fortunately the VA finally announced in March that a new
stand-alone hospital will be built on the Fitzsimons Campus and
a new SCI center will be included in that facility.
PVA was pleased that the final CARES Commission report
included several recommendations for the expansion of long-term
care services directed at spinal cord injured veterans as well.
Prior to the CARES initiative, the VA system of care
provided only 125 long-term care staff nursing home beds
dedicated to veterans with spinal cord injury. These SCI long-
term care beds were located in four VA facilities, at Brockton,
Massachusetts; Hampton, Virginia; Castle Point, New York, and
at the Hines VA medical center in Chicago, Illinois.
Interestingly, the VA had no institutional long-term care
beds for SCI veterans located west of the Mississippi River at
that time.
While some progress has been made to expand VA's capacity
for dedicated SCI long-term care, much work remains to be done.
Despite the CARES Commission recommendations to increase SCI
long-term care capacity, we believe that particular emphasis
needs to be placed on expansion into the western United States.
In 2007, VA released a copy of its long-term care strategic
plan that in the opinion of the co-authors of the Independent
Budget and outlined in the fiscal year 2010 Independent Budget
was lacking in specific planning detail regarding the future
direction of its long-term care program.
In 2008, PVA understood that VA was working on the
development of a second more comprehensive long-term care
strategic plan. However, to the best of our knowledge, no
follow-up plan has ever been released. We would encourage the
Subcommittee to investigate this issue further.
The CARES Commission emphasized in its final report that
strategic planning for aging veterans and veterans with serious
mental illness will be essential going forward.
The Subcommittee has posed the question about the viability
of CARES in assessing the future health care needs of veterans.
As pointed out in the Independent Budget for fiscal year 2010,
despite the fact that CARES was completed in 2004, the VA
continues to assess its needs and priorities for infrastructure
by using concepts derived from the CARES model.
PVA actually sees this question as being one about whether
or not the CARES recommendations made then appropriately
address new demands on the system, particularly as it relates
to the younger generation of veterans returning from Operation
Enduring Freedom and Operation Iraqi Freedom.
Moreover, the question seems to suggest that CARES did not
take into account that new demands to be growing in rural
communities and that the infrastructure changes outlined by
CARES do not reflect this change.
While we certainly understand this concern, we believe that
the CARES model appropriately addressed where the greatest
demand for care comes from.
Moreover, the CARES model provided a blueprint for aligning
VA's infrastructure to best meet the needs of the most veterans
possible.
Recognizing that certain demand has changed since 2004, the
VA has moved forward on other major and minor construction
initiatives outside of the CARES recommendations.
Mr. Chairman, we would again like to thank you and the
Subcommittee for examining this issue. We look forward to
working with the Subcommittee going forward to assist the VA in
accomplishing this difficult task. And I would be happy to take
any questions that you might have.
[The prepared statement of Mr. Blake appears on p. 54.]
Mr. Michaud. Thank you, Mr. Blake.
Mr. Cullinan.
STATEMENT OF DENNIS M. CULLINAN
Mr. Cullinan. Thank you. Chairman Michaud, Mr. Brown,
distinguished Members of the Subcommittee, on behalf of the men
and women of the Veterans of Foreign Wars and our auxiliaries,
I want to thank you for inviting us to participate in today's
very important oversight hearing.
In April 1999, GAO issued a report on the challenges that
VA faced in transforming the health care system. At the time,
VA was in the midst of reorganizing and modernizing after
passage of the ``Veterans Eligibility Health Care Reform Act of
1996.''
VA then developed a 5-year plan to update and modernize the
system, including introduction of systemwide managed care
principles such as the uniform benefits package.
In response to the enormous challenges brought about in
implementing this plan, VA began the Capital Asset Realignment
for Enhanced Services or CARES process. It was the first
comprehensive, long-range assessment of the VA's health care
system's infrastructure, since 1981.
CARES was VA's systematic, data-driven assessment of its
infrastructure that evaluated the present and future demands
for health care services, identified changes that would help
meet veterans' need.
The CARES process necessitated the development of actuarial
models to forecast future demand for health care and the
calculation of the supply of care and the identification of
future gaps in infrastructure capacity.
Throughout the process, we were generally supportive and we
continue to emphasize our support for the ES or enhanced
services portion of the CARES acronym. We wanted to see that VA
planned and delivered services in a more efficient manner, it
also properly balanced the needs of veterans. And for the most
part, that process did just that.
The 2004 CARES decision document gave VA a broad road map
for the future. It called for the construction of many new
medical facilities over the 100 major construction projects to
realign or renovate current facilities and the creation of 150
new CBOCs to expand health care in areas where the CARES
process had identified gaps.
The strength of CARES in our view is not its resultant one-
time blueprint, but in the decisionmaking framework it
produced. It created a methodology for future construction
decisions.
VA's construction priorities are reassessed annually, all
based on the basic methodology created to support the CARES
decisions. These decisions are created systemwide, taking into
account what is best for the totality of health care and what
its priorities should be.
We continue to have a strong faith that this basic
framework serves the needs of veterans in most cases. Despite
its strengths, there are certainly some challenges.
While a huge number of projects are underway, a number of
these, they are still in the planning and design phase. As
such, they are subject to changes, but they have also not
received full funding.
The Congress and Administration must continue to provide
full funding for the major construction account to reduce this
backlog, but also begin funding future construction priorities.
With the twin problems of funding and speed in mind, VA has
recently been exploring ways to improve the process. Last year,
they unveiled the Health Care Center Facility (HCCF) or leasing
concept.
As we understand it, HCCF was intended to be an acute care
center somewhere in size and scope between a large VA medical
center and a CBOC. It is intended to be a leased facility,
enabling a shorter time for it to be up and running, that
provides outpatient care. Inpatient care would be provided on a
contracted basis, typically in partnership with a local health
care facility.
While supportive of more quickly providing greater health
care access to veterans on a cost-effective basis, we expressed
our concerns with the HCCF concept in the Independent Budget.
Primarily we are concerned that this concept, which relies
heavily on widespread contracting, would be done in place of
needed major construction.
Acknowledging that with the changes taking place in health
care VA needs to look very carefully before building new
medical facilities, cost plus projected usage must justify
full-blown medical centers, that leasing is the right thing to
do only if the agreements make sense.
VA needs to do a better job explaining to veterans and the
Congress what their plans are for every location based on the
facts. The misconception that plagued the Denver construction
project amply demonstrates this point.
We have seen the importance of leasing facilities with
certain CBOCs and Vet Centers, especially when it comes to
expanding care to veterans in rural areas.
CARES did an excellent job of identifying locations with
gaps in care and VA has continued to refine its statistics,
especially with the improved data it is receiving from DoD on
OEF/OIF veterans.
Providing more care to rural veterans is a major challenge
for the system and the expansion of CBOCs and other initiatives
can only help. We do believe, however, that much of what will
improve access for these veterans will lie outside the
construction process.
VA must better use its fee-basis care program and the
recent initiatives passed by Congress such as the mobile health
care vans or the rotating satellite clinics in some areas to
fix some of the demand problems that these veterans face.
Mr. Chairman, that concludes my statement. I thank you very
much for this opportunity.
[The prepared statement of Mr. Cullinan appears on p. 57.]
Mr. Michaud. Thank you very much.
Mr. Weidman.
STATEMENT OF RICHARD F. WEIDMAN
Mr. Weidman. Mr. Chairman, thank you for your leadership,
yours and Mr. Brown's in holding this hearing today and to take
a look at this process of CARES and the whole construction
milieu within VA.
VVA supports the concept behind CARES given that it is a
concept of stewardship and each Administration is a steward of
the Nation's physical facility to care for veterans.
Unfortunately, that stewardship was not very well met
during various periods since it was first constructed following
World War II. And many of the facilities have become
dilapidated when they started to change from outpatient to
inpatient. In the early 1990s, they had renovated spaces that
then lay dormant.
Frankly, we were always skeptical of GAO's estimate that it
was as high as has been reputed to care for outmoded
facilities. All of the projections at that point were that the
veterans' population served by the Veterans Health
Administration would continue to decline on into the future.
That has not proven to be the case, however.
The veterans' population VA formula, which is for
estimating workload in the future, which is based on many of
the same formula from Milliman that was used in CARES, has
consistently underestimated the number of veterans who are
seeking services. Five years in a row, they have grossly
underestimated the number of OIF/OEF veterans who would be
seeking services and they have underestimated the number of
veterans of older generations who found need to and were
eligible to seek services from the VA even before the Congress
began easing the requirements for Category 8s to seek services
at VA hospitals.
So the assumption, one of the key assumptions behind it,
which was that there was a great deal of excess space and we
had a declining veterans' population has proven not to be the
case today.
The second major problem that we have with CARES that we
have had from the very beginning was that the formula was a
civilian formula that did not take into account that wounds,
maladies, injuries, and conditions that derive from military
service, particularly wartime service, and is detailed at VA,
at the veterans health initiative, the 32 curricula that look
into the special medical, long-range medical problems that
veterans have as a result of their military service or the
military history card that people say that we are fanatics
about that, frankly, needs to be incorporated into the
computerized patient treatment record and taken account of in
the diagnosis and treatment modalities at VA.
All of those things lead to a problem with underestimating
the number and types of resources that individual veterans will
utilize.
Second, because the Milliman formula was a civilian
formula, it estimates one to three presentations or things
wrong with them that need to be addressed by a clinician of
each person walking across the door sill. And, in fact, at VA
hospitals, it ranges from five to seven presentations per
person, not one to three.
In addition to that, it does not fully take into account
the VA formulas of not only wartime exposures but who is in a
geographic area. Many who can and who have the resources who
are middle class, as they age, they move south when they
retire. Those who are left are older and sicker and poorer,
quite frankly, so that the burden rate, the number of
presentations per person is going to go up in the north.
So both the Vera formula, which is not the subject of this
particular hearing, but also the CARES formula are going to be
somewhat askew when it comes to estimating what are going to be
the future needs of the physical structure within which the
health care is delivered.
There are four things that we recommend that be done from
this point on. The first thing is that the basic CARES formula
must be improved to take into account military service and
things that happened to people in the course of that and to
adjust that formula to the reality of who we see at VA
hospitals in terms of the number of presentations.
Second, we believe that the whole process needs to be much
more transparent. In the last 5 to 6 years, Veterans Health
Administration has, in fact, become much less transparent if
indeed not secretive and shown virtual contempt for the
Congress, for the veterans service organizations, for the union
and its members, and for virtually anyone outside who would
dare question any of their decisions no matter how wrong-headed
or how off base they were as an example in terms of the lack of
preparation for dealing with PTSD among all generations but
particularly OIF/OEF veterans.
Third, VVA urges that the major construction budget be set
at a level of at least $1.5 to $2 billion a year and possibly
even higher. This is the time to, for those who have the money,
to invest in construction. Why? Because so many people cannot
get financing, that the cost of material and labor is more
competitive now than it will be in 4 or 5 years when the
economy rebounds.
Number four, VVA strongly recommends that the Secretary and
the Deputy Secretary review the lines of authority and
accountability for CARES, who is responsible for what, define
those roles, and make it clear who is going to be held
accountable, a novel concept within the Veterans Health
Administration, who is actually going to be held accountable
for delivering what should be delivered and decisions on time
that actually results in enhanced services for veterans.
Mr. Chairman, I thank you for the opportunity for VVA to
present here today and for your leadership of you and your
distinguished Committee in holding this hearing. Thank you.
[The prepared statement of Mr. Weidman appears on p. 60.]
Mr. Michaud. Thank you very much.
Ms. Ilem.
STATEMENT OF JOY J. ILEM
Ms. Ilem. Mr. Chairman and Members of the Subcommittee,
thank you for inviting DAV to testify at this oversight
hearing. We appreciate the opportunity to offer our views on
CARES and to discuss the future of VA's health care
infrastructure.
DAV concluded at the completion of CARES it was a
comprehensive and fully justified road map for VA's
infrastructure needs. However, once the plan was released media
backlash developed to the proposed recommendations affecting
the operating missions of a number of VA facilities. Many
veterans, fearful that they would lose VA health care services,
opposed the plans for changes in their States and at their
facilities irrespective of the validity of the findings or the
value of the plan as a whole. Local and political pressure
became intense and in many cases, the proposed CARES
recommendations were abandoned.
Unfortunately, the past decade of deferred and underfunded
construction budgets has meant that VA has not adequately
recapitalized its facilities, now leaving the health care
system with a large backlog of major construction projects
totaling more than $6 billion, with an accompanying urgency to
deal with this growing dilemma.
Recently VA began to discuss the necessity to consider
alternative means to address the growing capital infrastructure
backlog and the significant challenge of funding it. VA
broached the idea of a new model for health care delivery, the
Health Care Center Facility or HCCF leasing program.
VA has argued that this model in lieu of the traditional
approach to major medical facility construction would allow VA
to quickly establish new facilities that would provide 95
percent of the care and specialty services veterans will need.
The HCCF model seems to offer a number of benefits in
addressing this capital infrastructure problem.
However, while it offers some obvious advantages, we are
concerned about the overall impact of this new model on the
future of VA's system of care, including the potential
unintended consequences on continuity of care and delivery of
comprehensive services, its biomedical research and development
programs, and particularly the impact on VA's renowned graduate
medical education and health professions training programs.
DAV is also concerned with VA's plan for obtaining
inpatient services under the model and we question the ability
for maintaining existing specialized services.
In November 2008, VA responded to a Senate request for more
information on VA's plans for the newly proposed HCCF leasing
initiative. In a letter, VA addressed a number of key questions
that may be of interest to the Subcommittee, including whether
studies have been carried out to determine the effectiveness of
the HCCF approach, the full extent of the current construction
backlog, the engagement of community health care providers in
the proposal, the ramifications on the delivery of long-term
care and inpatient specialty care, and whether VA would be able
to ensure that needed inpatient capacity will remain available.
What is not clear is to the extent which VA plans to deploy
the HCCF model. In areas where existing community-based
outpatient clinics need to be replaced or expanded due to the
need to modernize, add services, or increase capacity, the
model would seem appropriate and beneficial to veterans.
On the other hand, if VA plans to replace the majority or
even a large fraction of all VA medical centers with HCCFs,
such a radical shift would pose a number of concerns for DAV.
Fully addressing these and other related questions are
important, but we see this challenge as only a small part of
the overall picture related to VA health care infrastructure
needs in the 21st century. The emerging HCCF plan does not
address the fate of VA's 153 medical centers that are on
average 55 years of age or older.
As we grapple with the issue of health care reform in
America, we must make every effort to protect the VA system for
future generations of sick and disabled veterans. A well
thought-out capital and strategic plan is urgently needed and
the tough decisions must be made and not avoided as in the
response to the seemingly stalled CARES process.
Congress and the Administration must work together to
secure VA's future to design a VA of the 21st century.
Regardless of the direction VA takes, first and foremost, we
want to ensure VA's infrastructure plan maintains the integrity
of the VA health care system and all the benefits VA brings to
its enrolled population.
While we agree that the VA health care system is not its
buildings, VA must be able to maintain an adequate
infrastructure around which to build and sustain its patient
care system.
Although it is a significant challenge and costly prospect,
VA's infrastructure issues must be addressed now. Our Nation's
veterans deserve no less than our best effort.
Mr. Chairman, thank you again for the opportunity to
testify.
[The prepared statement of Ms. Ilem appears on p. 62.]
Mr. Michaud. Thank you very much.
Once again, I would like to thank all the witnesses for
your testimony this morning.
Several of you expressed a concern with VA's health care
center facilities (HCCF) leasing programs. What do each of your
organizations believe that the health care delivery system for
the VA should look like for the 21st century?
Mr. Cullinan. Mr. Chairman, with respect to the HCCF model,
we think that could be invaluable in providing health care
access to veterans.
I guess we have two primary concerns with it. First that it
not overreach in size and scope. I mean, at a certain point, it
makes sense to build as opposed to leasing. The leasing option
could really be invaluable in parts of the country where
building just is not an option.
The other thing has to do with the quality of the care that
is going to be provided through the HCCF model. And
specifically referring to contracting issues, there was this
situation, it was in Grand Island, Nebraska, where such a
facility was established, a contract was established with a
local health care provider hospital for the inpatient service,
and then the contract was backed out of which left it adrift
for a while.
Now, I understand that has been remedied at this point in
time, but these are the kinds of things that we would want to
carefully monitor.
Mr. Blake. Go ahead, Rick.
Mr. Weidman. I was going to say that used in moderation,
the HCCF can make some sense. Unfortunately, good ideas often
are given to the VA and they are like an 18-year-old who gets a
hold of a bottle of whiskey and they run amuck.
And the example would be so-called Project HERO where the
Congress instructed VA to rationalize the contracting out. And
instead, VA has tried to turn it into a fire sale of
contracting out as opposed to increasing and strengthening the
organizational capacity within the hospitals themselves. And
there are still problems with that. And in some areas of the
country, it is as much as 40 percent of the patients are
involved in Project HERO or HCCF type activities.
We have a real problem with utilizing something that makes
sense in some areas and then using that as a Trojan horse to
try and undermine and destroy the overall veterans' health care
system.
Mr. Blake. Mr. Chairman, what I would say is the question
seems to suggest that there is a one-size-fits-all solution to
meeting overall health care demand issues in the VA, and I am
not sure that that is the case. I think that is part of the
concern with HCCF is that, as Rick mentioned, there are places
where it is meant to work or where it should be used. But I do
not think you can apply that universally to the VA health care
system.
Additionally, as rural health care sort of becomes a larger
issue, I do not think you can just simply say we are going to
do this or we are going to do this.
Honestly, I believe that the VA in its recent release as
part of its rural health care initiative is starting to take
the right tact in addressing that particular demand issue by
using CBOCs, by using HCCF, by using direct contract. I mean, I
think it is going to have to be sort of a fluid delivery model.
I do not think HCCF in and of itself is the answer to the whole
problem.
Mr. Wilson. Mr. Chairman, HCCF would have to accommodate
that respective particular venue. As I have traveled throughout
VA facilities this year, I found so many different areas, I
found variations in those areas when we are speaking of urban
as opposed to rural areas. And we had issues with contracts out
in--with contract issues out in Sepulveda as well.
I think overall the American Legion is concerned about the
culture of care and the culture of care bringing about quality,
quality of care, understanding the veteran. The uniqueness of
the veteran must remain. And business as usual should not
filter into the veteran, as I said, who is a unique patient.
Ms. Ilem. And I would just add to the remarks of all my
colleagues, you know, we just want to make sure the integrity
of the VA health care system, the type of care that is
delivered, the high-quality care delivered is maintained. And,
you know, there need to be changes for the future for the 21st
century. And a one size, I think that I agree with Carl, you
know, is not going to fit every place, but there needs to be an
overall plan that is well thought out and can really take into
account all of these specialized services VA has been able to
provide to our Nation's veterans. We just want to make sure
that those are there for the future veterans.
Mr. Michaud. Thank you.
My next question is for Mr. Wilson and Mr. Weidman. You
both had talked about the importance of openness, transparency,
and accountability in the CARES implementation process and,
hopefully, the VA will be more open and transparent.
What do you think will have to be done for them to do that?
What would you consider to be openness and accountability and
transparency in the CARES implementation process?
Mr. Wilson. I think a continuous assessment. I think there
is too much time in between inspections or assessments and not
just--well, there is one inspection that the big group, Jayco,
and I have gotten calls from VA employees who say, oh, we get
through that because we plan for it. We know what they are
going to do and we plan accordingly. We can respond to them
with a general question.
So I am thinking, you know, throughout the American
Legion's visits are they doing the same. So I am looking at
some things within various VISNs. They are uniform questions.
We can look at it. We have roundtables over this and we are
looking at it.
And it is like, okay, this is just a general response that
they have given us and they are not--we take them through a
line of questioning and we find out more things are going on.
We talk to employees. We find out something differently.
So we feel that it has to be more transparent because the
bottom line is the veteran is going to suffer, you know, if
they are trying to make the system look perfect when they know,
you know, the system is fallible or it is--well, we have also
discovered complacency as well because of shortage of employees
and other things and space as well.
So we think and that is how we come to the conclusion that
there needs to be more transparency, some type of system of
checks and balances where they can pretty much open up.
Mr. Michaud. Thank you.
Mr. Weidman. Mr. Chairman, we increasingly over the last 5
years have been able to find out a great deal more about what
is going on by talking to union members around the country than
we can find out by meeting with the Under Secretary for Health.
And this is not the kind of partnership that certainly the
veterans service organizations envisioned nor the Hill nor
people who want to make this system work.
And it is not because we have all the answers. We do not.
But we have significant input that make the decisions better.
And so that is one aspect of the openness of starting to regard
veterans at the local level and at the VISN level as well as at
the national level as true partners, the veterans'
organizations in the process of how do we build and continually
rebuild, reinvent the best health care possible for our
Nation's veterans. That is one.
Second, the Milliman formula, no one has ever successfully
explained to us how it works. And the Milliman technicians time
and again said to us, well, we cannot really explain it to you,
it is too complicated, to which my response is, young lady,
contrary to what you seem to believe, those of us who served in
Vietnam were not too stupid to know where Canada was. We served
because we believe it was correct. Try us.
But we still have not gotten a successful iteration, if you
will, of how it works within that black box. But one thing we
do know is that it does not take into account the special
experience of veterans and having to do with everything from
toxic exposures to all the other kinds of things that one is
subject to in military service in the projections of the
formulas.
And we believe we need to have a task force appointed by
Secretary Shinseki to look into this and involve the veterans'
organizations as well as outside experts and not just folks
within the VA in every step of the process.
When they first formulated the CARES formula, they met with
the veterans' organizations a couple of times to say that they
met with us. And they said we are not to the point where we can
share any details with you, but we will call you together as
soon as we can.
Then Dennis Duffy, then with the Office of Planning and
Policy, called us all together and said this is what we are
going to do based on the report from all of our consultants.
And so a number of us had questions about it and said, once
again, what about the special problems that veterans have
ranging from SCI to much higher rates of visual impairment to
all kinds of other things and prosthetics, et cetera, to which
the response was it is too late, we are on a schedule, we have
got to stick with what we have got now.
Whereupon, our response from VVA was when was the 1.2
seconds for the veterans service organizations to make their
input into this process. Do not go back and tell the Secretary
and the Congress that you consulted with the veterans service
organizations when, in fact, all you did was inform us and said
too bad, this is the way it is going to be, you folks.
That partnership, I am not sure how you can legislate that,
Mr. Chairman. I do believe that Secretary Shinseki is going to
approach this process differently because he and Deputy
Secretary Gould understand that you make better decisions when
you consult with labor, when you consult with the stakeholders,
with the patients, and when you consult with people outside of
the system who have a legitimate stake in seeing that we have
the best health care for our Nation's veterans.
Mr. Michaud. Thank you very much.
Mr. Boozman.
Mr. Boozman. Thank you, Mr. Chairman. I have enjoyed the
testimony.
I am an optometrist, so those of you that are having
problems with your eyes or whatever, I will be able to give you
some free advice later.
But I was listening. My brother was an ophthalmologist, an
eye surgeon. We went into practice many years ago, and one of
the procedures he did was cataract surgery. Thirty years ago
when he did that, it was probably about a 2-hour procedure. The
results were not very good.
If that were still going on today as it was then, as I look
out, many in the audience would have the big old cataract
glasses. You know, the ones that magnified your eyes and
restricted your vision.
The surgery was done and then you were put in the hospital
for 3, 4, or 5 days with sandbags around your head. That
procedure is now done in about 15 minutes. You immediately go
home, and probably miss a day of work and then go back.
That procedure is that way and so many of our procedures
are heading in that direction or have already headed in that
direction. So, I think that we would all agree that there is a
need for looking at the way that we do things and adapting.
I guess the key is that as we start doing that, when we
talk to GAO just in visiting with you guys, visiting with the
CARES Commission, whatever, there really is a resistance to
change. In the communities, there is a fear. I agree that
certainly the number one thing is the quality of care. That is
without a given.
I understand also the culture. I think that is very, very
important, the things that you all have mentioned. But I guess,
and you mentioned the task force some ideas and things. Give me
some more ideas or let us go further with that.
How do we, as we go forward, and I think we all agree that
things are changing and we have got to get into the present,
how do we break down the resistance to change? You know, how
can you all be helpful in that?
You mentioned the transparency issue is so important. And I
agree with that.
You know, again, on the other side, they are probably a
little bit hesitant in the sense because there has been such a
resistance to change sometimes that you immediately get shot
down regardless of what you are doing.
So, if you all would discuss a little bit about maybe some
other--kind of dwell a little bit on how we can get--
transparency. You mentioned task force. What other things are
out there? How can you guys help us, like I said, look
without--to kind of break down this both at the community
level, the district level, and then at the VA level?
Mr. Cullinan. Mr. Boozman, if I may, the VFW handles the
construction portion of the IB. We have been doing it for a
number of years and we are happy to do it. It is such an
important issue.
A big concern of ours is that this be a highly dynamic
process and we believe the CARES system is that. Yes, in the
early stages of CARES implementation, there was a lot of
murkiness.
I remember when the CARES document was finally released, I
got a PDF version of it and a hard copy. And it was an
avalanche of information. It really defied my ability and my
staff's to even begin to entertain what was said in there. But
over the years, with respect to the implementation, yes.
I talked about Denver earlier. There have been other places
where the implementation has been murky. First something is
going to be one thing, then it is going to be another and it
changes back again.
But I have to say that with respect to our dealings with VA
in dealing with trying to get the explanations of how the
actuarial models work, the budget model, the Milliman, and then
beyond because VA has gone quite beyond the--VA has been quite
forthcoming actually formally and informally, I have to say
that while their budget model certainly is beyond what I can
really apprehend, it seems very accurate.
I spent a day over at VA with a colleague of mine and they
went through an explanatory process. And they really have this
refined to an art and it is not a static art. It is something
that they continue to work on.
With respect to the construction needs outside of the
modeling itself, again, we have had a positive experience with
VA. So I just want to add that.
Ms. Ilem. I think some of the things that have been
mentioned, that communication is the key, especially with
CARES. Those of us that, have been around from the very
beginning of CARES through now, one of the biggest problems was
the communication issue.
When things came out and people realized that there may be
a change or there was a proposed change, there was a panic. And
oftentimes just being able to communicate beforehand, before
all of a sudden you get something that is just sprung on you or
seemingly sprung on you, you were not aware of, you know,
working with Members of Congress, working with the local
officials, the VISN, and, I mean, all the way down with
veterans and really having a good understanding and that they
play a key role.
And if you are talking, sometimes just the language, if
they hear closure or realignment, they do not understand what
that exactly means. They just think for me, my services are
going away. This is what I want. It is here. It is where we
need it.
And people are very protective which is a great thing about
what you really saw. People really came to show you how
important the VA is to them and what it really is able to
provide.
But I think just with communication and a much better
strategy, openness with the veterans service organizations,
certainly we can help. I mean, we all have chapters and
departments throughout the Nation. We can get people there,
making sure that they are part of the dialogue from the
beginning rather than, as Rick mentioned, at the end, which is
oftentimes, you know, then you are in a defensive position
right from the get-go.
Mr. Weidman. You also have to tell the truth. I mean, that
is one of the problems with Denver was that there were people
there and people within 810 Vermont who were not telling the
truth to the Secretary. And so the Secretary got called out
repeatedly, three different Secretaries, in what was going on
with that process. And they did not tell the truth to the
veterans.
The one thing that is, vets will sometimes get mad, but
they will always accept it if you play straight. The one thing
that will make veterans madder than hell is if you lie to them.
And I do not blame them. And it makes me madder than the
dickens. And when they lie to us, that makes us angry. But
people have not been held accountable for that in the past.
The next panel has on it the Honorable Everett Alvarez, a
true hero in war and in peace. And as Chair of the CARES
Commission, it was Mr. Alvarez, Chairman Alvarez who took all
the heat from all the places around the country and made the
necessary change to CARES to avoid it being a debacle and he
caught all the heat for the stupidities of people within the
bureaucracy. And he actually did not have white hair until that
point and the CARES process did it to him.
But we do not need to abuse our heroes in order to make
steady progress in the future if we mandate that every
hospital, as an example, have regular meetings with the
veterans service organizations about the quality of care and
the care service lines at that facility and not turn them into
dog and pony shows where people have 15 minutes to ask
questions. And the same thing is true at the network level to
really assess consultation with the community.
If you call a Veterans Integrated Services Network, the
idea was that somehow it is closer to the community, but by and
large, that has not happened in many of the VISNs or at many of
the facilities. And that is a step that needs to be taken.
And I think that the new Under Secretary for Health, that
decision is really going to be key, that that be someone who is
as open and direct and as straightforward and honest as
Secretary Shinseki is and is committed to veterans' health
care. So who that individual is is going to set the tone.
And, once again, I am going to hearken back to something
Secretary Shinseki told the full Committee at his first hearing
over here on the House side. When asked was there additional
legislation needed, his answer was most of our problems have to
do with leadership and accountability. And that is still the
issue.
Together, if it was a leadership and accountability within
the VA and proper respect not only for the individual veteran
seeking services but for the veterans' organizations and expect
us to do our part of the bargain of doing our homework before
we come to meetings by sharing good information, then we can
make some steady progress together and with that openness.
But I do not know that there are things that you can
stipulate in statute to get people to act decently.
Mr. Blake. Mr. Boozman, if I might just quickly. You
mentioned our resistance to change and our longstanding
concerns about broad-based contracting notwithstanding. Some of
this idea of change, our resistance comes from us applying the
does this make sense test to a recommended change.
You know, I will use as an example under HCCF, I think we
have said here today that applied correctly, it is a good
thing.
Early on when this was discussed, Salisbury, North
Carolina, was put out as a possible HCCF facility. It was going
to involve contracting for certain services that are already
being provided in the Salisbury facility. And it is not like
they were being contracted to an area 50 or 100 miles away.
They were being contracted out into the local community.
So we asked ourselves does that really make sense. And from
our perspective, the answer to that question is no. So then
there is no other really explanation for why to then apply HCCF
to a facility like that.
There was a Booz, Allen, Hamilton report that focused on a
number of these HCCF designated facilities that came out last
year, and if I can find it, I will be glad to submit it for the
record, and it reads sort of like a multiple choice test. And
it has, you know, example A and here are A, B, C, and D as the
solutions to the problem. And you read that and if you pick the
answer, at the end, the findings of the report completely go
against what you think make sense.
So I think as we move forward with change, we have to apply
a little bit of just common sense to the process and not
simply, well, this is the model we want to make fit because we
think it is a good model.
Mr. Wilson. Mr. Boozman, I think it is consistency when
implementing policy, the communication as well throughout the
VA system. For example, there was previously 1 million veterans
that migrated to rural areas. Now it is 2 million. And that
went up pretty quickly.
VA has to track better and they have to be consistent at
tracking because we found even in our travels that some were
tracking, for example, those 500,000 who had applied after 2003
who will be in the system now, but some have tracked and some
have not tracked. That is inconsistent.
And so the American Legion, we think there should be a
better tracking of veterans period from the time they leave DoD
to the time they transition into the community. That is not
something that is as difficult as if you were tracking
nonmilitary simply because one issue that a veteran may have is
the microcosm of many.
So when you, for example, as I said, you have 2 million who
migrated to, who live in rural areas, and a high number of
those recently migrated, not the full 2 million, but a high
number of those did, so it is pretty much a pattern and it is
in huge numbers, so it is trackable because we have had some
systems who have tracked and some said they were unable to
track. We need to know why.
Mr. Boozman. Thank you, Mr. Chairman, very much.
Mr. Michaud. Thank you.
Mrs. Halvorson.
Mrs. Halvorson. Thank you, Mr. Chairman.
Thank you, panelists, for being here.
Mrs. Ilem, you mentioned in your testimony that some of the
facilities are outdated. One of them you mentioned is near my
district, Hines in Chicago.
With the need and probably too much need basically to get
it up to the 21st century needs, do you think that it might be
better to put the money and the needs to expand more CBOCs
because, as Mr. Boozman said, we need to adapt to change? And
now people are not spending as much time in the hospitals and
maybe we need to do more to the outpatient clinics.
So I do not know. Since you had it in your testimony, we
can start with you. And I do not know if anybody else wants to
mention that as we have more challenges in new health care,
whether it be mental health or some of the other traumatic
brain injuries or women challenges, should we be putting our
emphasis more on the CBOCs?
Ms. Ilem. Well, I would just say one thing--I remember
sticks out in mind from our Independent Budget were PVA has
architects and people available within their organization who
have expertise in construction issues. And when we have talked
about renovating or updating or modernizing a facility, one of
the things that sticks out is that they continue to say,
oftentimes, that it costs more to try and renovate a place than
to build a new facility.
And because of the new types of equipment that are
available today, the rewiring, the ceiling heights, there is
just a number of issues like that that come into play.
So the assessment, which was nice about CARES, was it
really gave you--I mean, when you opened the books and as we
said, we got volumes of books on each location, you can really
get a feel, if you have not been there, for each of those
facilities.
But certainly many of us travel around for our
organizations. We visit the VA facilities. And they are doing
the best that they can. They have retrofitted these almost
outpatient clinics within medical facilities which used to be
wards and different things. And they have tried the best they
can to make renovations with the money that they have gotten.
And a lot of them have added new additions on.
I just came back from New Hampshire this weekend. I visited
the VA facility and they showed me a new addition. They have
not opened the new wing yet. It is just night and day between
the original facility itself and just the look, the feel, the
space confinement, and you go to the new addition, the new
wing, which was just literally brand new, it has not even been
furnished yet. They have the appropriate size doors, wheelchair
accessible, it is very modern. It is like you are in another
world. And they were talking about all the clinics that will be
moving down there.
And I know in your facility, Tammy Duckworth was a big--I
remember her testifying in the Senate way back when she first
got back about her impression just of coming to the facility,
the prosthetics department, and how, you know, dungeon-like
things were there. And even regardless if you are getting good
quality care, I mean, there gets to be a point where, you know,
you have to look at the modernization of some of these
facilities.
So I do not know that the HCCF model certainly will be a
good model for many places. Again, we just have to have VA
looking at this big picture of the way care has been delivered
for years and years with this inpatient capacity and what we
lose when we go an HCCF model and we outsource care.
And the big thing that researchers tell us is when care is
provided outside the VA, contracted out for it, we do not know
what the quality of that care is. They tell us that with
women's health especially.
So I think that stands as one thing that we really need to
look at because that has been--VA has worked very hard to bring
up the quality of its care and be renowned within our Nation
for the care it provides. So we just want to ensure that that
is maintained as these changes come about, whatever they are.
Mr. Blake. Mrs. Halvorson, one thing I would also mention
as it relates to maybe indirectly Hines is Joy mentioned
modernization and modernization of an aging major tertiary care
facility does not necessarily equate to building 10 CBOCs or 10
super CBOCs or whatever because while you may expand capacity
and access points through some sort of model like that, you may
then ultimately diminish the scope of services that are
available if you move out into that setting away from Hines.
I am not suggesting that maybe we need to just build a
whole new hospital in place of Hines, but when you think about
the fact that from PVA's perspective there is a spinal cord
injury center there, but the scope of services that support
that SCI center are far reaching beyond the immediate SCI
delivery model. And if you move it out into the community into
super CBOCs, which was something that was suggested under the
Denver plan last year, I think you run the risk of diminishing
more important services that are provided through that tertiary
care hospital. And you put at risk probably the highest end
users of the VA health care system.
Mr. Weidman. The paradigm that we either have to go to
CBOCs or live with an outmoded facility, I would suggest is a
false dilemma. This is the United States of America and if we
need a brand new hospital in order to properly care for
veterans in a major urban center in our country, then we should
do--I did not notice anybody with George Washington University
Hospital over in Washington Circle suggesting that they open a
bunch of community clinics. What they did instead was build a
whole new hospital and blew up the old one. And if we need to
do that in Hines, then we should do that.
And somehow we have gotten used to thinking that our best
days as a Nation and our most powerful days when we can take
care of the men and women in our democracy who put their lives
on the line in a first-rate manner in brand new facilities that
we cannot do that anymore. Frankly, at Vietnam Veterans of
America, we reject that notion. And we need to move forward.
And where we need to replace a whole new hospital, then we need
to do it.
Mrs. Halvorson. Well, I have a tendency to agree with that.
However, that is why I am asking all of you where the future is
and where it is that we need to go. And I have people call me
every day that they are tired of going there and sitting there
all day just to be turned away. And what are we going to do
about that.
And so we need to do something. Our veterans deserve the
best care ever. And if we need to build them a new hospital,
then we need to do that. There are all kinds of things that we
could be doing for them.
Mr. Cullinan. Mrs. Halvorson, I would just add to the
conversation. I mean, again, we need a dynamic process to
address these issues as has been pointed out. A new hospital is
not always the answer. Sometimes it is a CBOC. CBOCs are very
popular where they are established.
The HCCF model will remedy some of the problems where a
hospital is not appropriate and a CBOC is not enough. And that
is the key thing is to address all of the issues as best as
possible.
One thing that is contained in our testimony, there are
certain rural areas where the probability of an HCCF model is
unlikely. There simply are not the assets in place to even
construct something like that. There is certainly not the staff
availability.
So then you need things like contract care. Mobile vans are
another solution. There are other satellite type solutions to
these kind of problems. And that is what needs to be done.
Years ago, we used to say that about VA medical centers and
it certainly is still true of some of them, the only way to
renovate one is by jackhammer. They were concrete bunker-like
structures. They just do not lend themselves to modification
for modern medical purposes. So there is that too.
And the final thing I will say with the shifting patient
workloads, again a dynamic solution is the only way to go
because veterans are going to continue to move around and new
needs will arise.
Thank you.
Mrs. Halvorson. Thank you.
Mr. Wilson. You know----
Mrs. Halvorson. Go ahead. One last.
Mr. Wilson [continuing]. When we talk about facilities,
facilities, and facilities and we must keep in mind the veteran
at all times. I mean, if we have to write it on the paper 50
times just to keep in mind who we are serving, I mean, this is
practical. We are talking about appropriate accommodations, is
it adequate.
Those questions we have to continue to ask over and over
again because now you also have women veterans. Forty-nine
percent of women veterans are seeking care outside of VA. So
there is a fragmentation of care amongst women veterans that is
unprecedented. I mean, just within this past 6 months, it has
grown. We do not know the numbers now, but that was about 3 or
4 months ago, we found out it was 49 percent.
We must keep that in mind when just not--just finishing a
facility or how nice a facility looks or the location. It is a
matter of, as I stated previously, the American Legion supports
better tracking. We are contacting various posts out there,
sending out various blasts and receiving the information as to
how many veterans are in that area, what the pattern, you know,
as far as the pattern and all.
But a concern when as far as accommodations and building
these facilities, all those women veterans who for some reason
are seeking care outside of VA because actually it was one of
the reasons they are not receiving continuous care.
Mr. Weidman. May I just add that is poor organization in
the clinic. And, frankly, the clinic Director should be
reprimanded. I mean, it should not ever happen anymore at VA
that somebody--because we know of no guidelines any place in
the country at any of the 153 medical centers where it is
supposed to be done--the way they used to do it is you go in at
7 o'clock in the morning and you wait until whenever you get
seen. There should be appointments and waiting no longer than
30 minutes.
And if it is not happening in Hines, then I would suggest
that you may want to make a call to General Shinseki and say
what is happening here that is--what is not happening here that
is happening elsewhere where people are not being treated well
in my district.
Mr. Michaud. Mr. Bilirakis.
Mr. Bilirakis. Thank you, Mr. Chairman. I have one question
for the entire panel.
One of the shortcomings of CARES was the lack of long-term
care in outpatient mental health services. Do you believe that
VA has made progress in its ability to model demand for these
services and improve access to these services?
That is for the entire panel again. Thank you.
Mr. Cullinan. Mr. Bilirakis, I will just say one thing
briefly about that. I think that VA is quite capable, and I
know there are others who would agree, about modeling demand.
The problem is actually answering that demand and it comes down
to resources. It is an expensive proposition.
You have long-term care and mental care that still really
are not properly accommodated under CARES. We do not believe
that they cannot actually model them. We believe that they can.
It is just where is the money going to come from.
Mr. Blake. Mr. Bilirakis, I would suggest that there have
been instances in the past where I think VA senior leadership
has shown the desire to get out of the business of long-term
care as a whole. That can be reflected in some of the budget
requests that were made in the past.
And I think if you read the GAO report that came out
earlier this year about long-term care and the modeling and
funding that, you will see that while it is something the VA
needs to be doing, their approach to it is broken obviously.
And as I mentioned in my testimony, our concern remains
about a long-term care strategic plan going forward. And that
does not just apply to SCI veterans. That applies to all
veterans.
And so if there is definitely a flaw, that would be it.
Mr. Wilson. You mentioned long-term care. When I think of
long-term care, I think of the old nursing home care units in
which VA is transitioning into community living centers.
We saw good things there because they are trying to
acclimate the veteran back into the community. There are also
active duty who are with those needs. If they request, they can
receive it if it helps that active-duty member as well.
I think on behalf of the American Legion, I think there has
been progress, but they have a ways to go because of the
various injuries and the veterans with the various injuries,
they are showing up at VA and either they are referring them to
outside facilities still, so it leaves a big question mark with
us as to where they are going from here because to this point,
we feel that they have been reactive.
Ms. Ilem. Yes. I would just mention long-term care has been
one of the issues all of the organizations have really talked
about over the years, that we just have not seen this strategic
plan materialize, and it just seems to be put off, put off into
the future.
When we go out to visit facilities, again I was just in New
Hampshire, and they did have a nursing home component with an
inpatient component there. And I asked the medical center
Director, you know, how did they provide services to support
the long-term care unit in terms of oftentimes elderly people
have real hospital care needs and this is not a full scale
hospital. So they do have to do a lot of the contract care and
take them by ambulance to a nearby facility for that type of
care.
So this is just another issue even though a lot of VA is
pushed out like the Nation. You know, everybody wants to be
provided care in their home to the largest extent possible. We
have many elderly veterans who have either a spouse that is
their same age in their mid 80s that cannot care for their
spouse any longer and they do not have the support at home even
if somebody is coming in a couple days a week. They really need
inpatient bed care.
And, you know, these people have been in the VA system for
their entire life, since they have gotten out of service and
been a part of that system and they want to stay with VA. So we
need better collaboration with the State Veteran Home
community, which is another option in many States.
But this issue we do not feel has really been addressed and
should be taken up as part of the infrastructure issue as it
moves along.
Mr. Weidman. A couple of things to add to that, if I may,
Mr. Bilirakis.
Joy is absolutely correct as we have been waiting on that
so-called strategic plan on long-term care for a very long
time. And it needs to be addressed and it needs to be addressed
in conjunction and cooperation and collaboration with the State
Directors of Veterans Affairs and the State Homes because a lot
of the solution in many parts of the country is going to be
that need is going to be met through the State Homes more
effectively and probably more efficiently.
And home health care has great promise for many people, but
there are instances, as Joy just pointed out, where it is not
in the cards because of the particular situation.
In regard to the second half of your question having to do
with mental health, there are models where we can predict where
we are going to need services, but they have not been employed.
Frankly, we believe we need new national leadership in mental
health and we need it soon.
There are the clinicians and certainly the folks at the
National Center for Posttraumatic Stress Disorder who can help
produce the models where we can make sure that between the Vet
Centers or the readjustment counseling service and the
inpatient services that are available that we have the
inpatient services available when they are available in every
network in the country and halfway in between outpatient and
inpatient is residential care which is appropriate to many
folks, like Canandaigua is a good example of that or, excuse
me, Batavia in upstate New York. It is much less expensive
because you do not have 24-hour nursing and you have the
patient where you need it.
VA has hired 3,800 new clinicians, 3,800 new mental health
clinicians. And so we are asking where the heck are they,
number one?
Number two, where is the in-service training to make sure
that they are adhering in every one of the 153 hospitals to the
best practices guidelines as outlined in the June 2006 report
from the Institute of Medicine for diagnosis and assessment?
And, number three, where are the research projects and
clinical trials to do what the Institute of Medicine said VA
had been doing which is robust clinical studies to figure out
what kind of treatment modalities work with what particular
kinds of veterans because post-traumatic stress disorder, to
say somebody has PTSD is like saying somebody has cancer? There
are a zillion different kinds of it and you have got to have an
accurate diagnosis in order to be able to effectively treat it.
So the modeling, I think, is there, but the question is
overall leadership and assessment and accountability. Thirty-
eight hundred new clinicians nationwide is a lot of people. And
that may not be enough, but right now I am not sure that we
know exactly how many more we need in order to adequately meet
the need given the length of the wars where there is no end in
sight in either Afghanistan or Iraq at the moment.
Mr. Bilirakis. Anyone else want to address the mental
health services issue?
Ms. Ilem. I would just say one thing. This is a particular
issue. I had a veteran call and they were looking for services.
They were down in the Florida area. The brother called me and
said my brother is under a bridge. He is enrolled in VA health
care. He wants to get into a substance use disorder program. He
has PTSD. He has some issues, but he needs to detox. He needs
to get in a facility. He needs an inpatient bed.
The homeless coordinator went out and picked the veteran
up, got the veteran. The family was very thankful for that. The
problem was they were not going to have a bed available for
this veteran. He was ready. He needed help then. The family
called in panic and said if they allow my brother to go back
out, he feels he will die, you know. He cannot make it.
After I cannot even tell you, I think 10 phone calls and it
finally went up to Central Office level, they got this person
into a detox bed and he was there for 24 to 48 hours. The
family was expecting the veteran would go right into the
substance use disorder or long-term inpatient program. They
were told there is no room for that patient by the time he had
detoxed. And they were going to try and send him out. They were
trying to find accommodation in the community. They could not
accommodate him.
Again, the family in a panic called, said can you please
help. I was calling up and down the coast, this family said we
will pay for him to go anywhere in VA. There was no
coordination of inpatient services where anyone could tell me
there is a bed available for this person until, you know, again
it was elevated to the Central Office level.
Eventually they found a bed in Florida. They were able to
get this veteran in. But after a certain amount of time, he
went out--I do not know if they did not have a residential unit
for him to then transition into and the family called about 6
months later and said that--they really thanked me for the
help, but that he had died, the veteran had died.
So, again, these kind of things, having the inpatient
services when and where they are needed, especially when we
have so many returning veterans from OEF/OIF that are having
mental health issues that really need some sort of support.
They are not, you know, getting it at home or in an outpatient
setting.
So it is so critical within the VISN, as Rick mentioned, to
be able to have the current services one after the other. Why
bring them in to detox them to be able to send them out to the
community again back under the bridge until a bed is available
in 30 days?
I mean, we just hate to hear that kind of thing and that
without any coordination throughout VA, even with different
people very interested in helping, but not being able to tell
me, well, there is a bed here or there.
Mr. Weidman. May I add to that, Mr. Bilirakis. We have
known for 25 years that Florida veterans' population was going
to be where it is today in 2009. I can remember when then
Governor Bob Graham was running for office and talking to him
about what needed to happen in terms of expansion because by
2015, Florida, I think, is still projected to have more
veterans than California. And 10 percent of all veterans in the
country live in California.
So it is not that this came upon us as a sudden shock, but
the expansion of services, particularly for neuropsychiatry
within Florida, has not kept up with the need.
We have a hard time figuring out why people from VISN 8 to
VISN 1 and 2 are telling us that they have a really tight
budget this year when we got a 12-percent increase in the
veterans' health care budget. I mean, we have talked to Mr.
Edwards about it. We have asked VA repeatedly and get no
straight answers about the 2009.
So some of the problem that you are alluding to is it is
not just the overall resources, it is how well are we applying
those resources within the VA structure itself. Are we getting
the bang for the buck both on the construction side, but also
on the services side?
And I think we have a right to expect some answers about
where are we in the 2009 budget, where are we with the kind of
services that Joy is talking about, particularly in an area
that ostensibly is a quote, unquote winner under the Vera
allocation model of where the health care dollars actually go.
Why aren't there any services available?
I have gone through the same thing with the TBI problems in
Florida of trying to find a bed and repeatedly having to go
back at the behest of the family and intercede to keep a
veteran who could not function on his own with bad TBI from
hitting the street. I mean, something is wrong in VISN 8, but a
lot of it has to do with overall organization and
accountability.
Mr. Bilirakis. Thank you.
Mr. Michaud. Thank you very much. This has been really
helpful.
Since the next panel has only two witnesses, I just have
one last question. If you can please keep your answer brief.
A lot of the discussion this morning has been centered
around creating new access points for our veterans. There has
been talk about the current process and how it has to be open
and transparent, including some of the decisions in Colorado.
My question is, by the same token, when you look at
creating new facilities, politics sometimes get involved. But
also the reverse is true, when you try to close facilities. I
know when the VA asked PriceWaterhouseCoopers to look at 18
sites in VISN 1, which is my VISN, they recommended closing
four medical centers. The VSOs in that region were outraged.
They wanted their medical facilities there versus having a
brand new one that could accommodate the needs.
So, while we want to create new facilities, if the old
facilities are inefficient facilities and we have to close
them, that puts the VSOs and elected officials in the awkward
position of having to say, yes, it should be closed.
So my question then is, to be more transparent in deciding
whether, where, and when we should either open or close
facilities, should we establish a process similar to the Base
Realignment And Closure (BRAC) process where they will make the
decision of which facilities are inefficient and should be
closed and where we should build new facilities?
Mr. Blake. I do not know if I can honestly answer that, Mr.
Chairman, but I would say that, you know, even the BRAC process
is not without flaws, I believe. I think politics still enters
into even decisions made through BRAC. So I think you run a
risk whether you create another commission that is going to say
yea or nay on opening and closing facilities or not.
I think you point to the fact that all politics is local.
Denver was a perfect example. The decisions there were
ultimately made by the local population of veterans and the
organizations there.
So it is a tough situation for us to be in. And I
sympathize with you, Mr. Chairman, with the situation. I do not
know. We do not have an official position on whether that would
be a good idea or not. If you propose legislation, we would be
glad to take a look at it and work on it from there.
Mr. Wilson. Also, Mr. Chairman, I would like to on behalf
of the American Legion, I would like to reserve that response
for a later date.
Mr. Cullinan. Mr. Chairman, I would just certainly concur
with my colleague here about the honesty portion of the BRAC
Commission or a BRAC-like Commission.
I mean, one thing that needs to happen, though, VA has to
clearly explain to local veterans what is going to take the
place of a hospital. The VFW agrees that there are hospital
facilities out there that need to be closed that are a waste of
resources.
The way to do that, though, is to clearly explain to
veterans, well, not all health care resources are going to go
away. We may be closing this old, obsolete hospital, but we are
going to replace it with a CBOC or an HCCF that is going to
take care of all your needs in a way that is even better than
what you have got now because we are going to give you, for
example, three CBOCs instead of one old hospital, and you are
not going to have to travel as far. They will take care of all
your needs and more serious inpatient type care is in line. We
can take care of that too. Just explain the situation.
Mr. Weidman. It is a difficult thing and I am not sure
going to BRAC makes sense personally. And I do not think it is
just because I am biased in favor of it as a former Army medic.
But the decision to close Walter Reed at its current
location, given its history and centrality in American military
medicine, is a bonehead move and hopefully will be undone. That
is with all due respect to my good friend, Tony Principi and
his colleagues who worked very hard on the BRAC Commission.
The green eyeshade boys, if you will, that came up with the
idea that somehow it would be cheaper to build a new tertiary
medical facility in Bethesda, a very expensive location, versus
renovating the current hospital and that they could build a new
tertiary medical facility for $800 million, I began to laugh. I
said you are not going to in Bethesda open the key to that
front door for less than $2 billion plus. And that was even 5
years ago.
So I am very dubious of some of the, with all due respect,
I am not going to pick on PriceWaterhouseCoopers, but the
consultants, if you will. When they look at northern Maine and
they say, well, you can travel from Togus down to here. Well,
they have never been in northern New England during most of the
year. And as they used to say in northern Vermont where I lived
for a long time, you cannot get there from here at that time of
year. And they simply do not understand the local situation. So
you need to reconfigure and work with the community.
And, frankly, one of the smartest things was keeping
Canandaigua open as opposed to closing it in upstate New York
where it is now the home to the nationwide hotline and those
jobs are great jobs in Canandaigua. And it does not matter
whether the hotline is in Chicago or in Canandaigua or it would
not matter if it was in Toga, Spain.
So rethinking the use of those facilities about how do you
serve the overall need of the Nation's veterans in all 50
States, if we approach it from that point of view, then I think
you can come up with politically palatable solutions that meets
the needs of the local community and does not live in the past,
sir.
Ms. Ilem. I would concur with many of the comments my
colleagues made about concern over a BRAC scenario. It just may
cause a lot of problems just to even use that term or that
concept.
But maybe looking more individually, but really working on
more transparency and communications with veterans in those
States and the data that is really being used to come up with
some decisions and why changes are being proposed and they feel
changes need to be made.
But, of course, you need to take into account veterans'
preferences and their concerns in local areas which each one is
unique.
Mr. Michaud. Thank you very much once again for your
testimony this morning. As you can see by the time, there has
been a lot of discussion and a lot of concern and a lot of
interest in this very important issue. I really appreciate your
willingness to come forward today to give us your thoughts and
ideas on how we should proceed from here. Thank you very much.
I would like to now invite panel two to come forward. We
have Everett Alvarez, Jr., who was Chairman of the CARES
Commission, and Mark Goldstein, who is from the Government
Accountability Office.
I want to thank both of you for coming here this morning
and sitting through our first panel to hear the discussions and
the questions for the first panel. I look forward to your
testimony as well as an open dialogue on where we go from here
when you look at providing access to our veterans throughout
this great Nation of ours.
So without any further ado, Mr. Alvarez, would you please
begin.
STATEMENTS OF HON. EVERETT ALVAREZ, JR., CHAIRMAN, CAPITAL
ASSET REALIGNMENT FOR ENHANCED SERVICES COMMISSION, U.S.
DEPARTMENT OF VETERANS AFFAIRS; AND MARK L. GOLDSTEIN,
DIRECTOR, PHYSICAL INFRASTRUCTURE, U.S. GOVERNMENT
ACCOUNTABILITY OFFICE
STATEMENT OF HON. EVERETT ALVAREZ, JR.
Mr. Alvarez. Thank you. Mr. Chairman, Members of the
Subcommittee, thank you for the opportunity to be here this
morning to discuss the work of the CARES Commission.
And I have provided the Subcommittee with my full statement
and ask that it be accepted for the record.
Mr. Michaud. Without objection, so ordered.
Mr. Alvarez. Let me begin by saying that the CARES
commissioners, many of whom are veterans themselves, were well
aware of the enormous implications their efforts may have on
the veterans and the VA health care system.
We knew we had a moral obligation to be objective and
transparent because our review would serve as a blueprint for
resource planning at the VA and an approach for medical care
appropriations long after the Commission's work had ended.
Our efforts are documented in the CARES Commission report
dated February of 2004.
Mr. Chairman, let me take a step back to provide some
historical context that led to the creation of the CARES
Commission and its body of work.
CARES was a multifaceted process designed to provide a
data-driven assessment of the veterans' health care needs.
Simply stated, the process used projected future demand for
health care services, compared the projected demand against
current supply, identified capital requirements, and then
assessed any realignments the VA would need in order to meet
future demand for services, improve the access to and quality
of services, and improve the cost effectiveness of the VA's
health care system.
The CARES process consisted of nine distinct steps and I
have outlined these nine steps in my written testimony. It is
one of these steps, step six to be exact, that the CARES
Commission, after reviewing a draft national CARES plan and
other information, conducted its review and analysis and then
issued its report to the Secretary with findings and
recommendations for enhancing health care services through
alignment of the VA's capital assets.
Since the CARES process was primarily a VA internal
planning process, the CARES Commission was established by then
Secretary Anthony Principi as an independent body to conduct an
external assessment of the VA's capital asset needs and
validate the findings and recommendations in the draft national
plan.
The Secretary emphasized that the Commission was not
expected to conduct an independent review of the VA's medical
system. However, as we conducted our analysis of the draft
national plan, we were expected to maintain a reliance on the
views and concerns from individual veterans, veterans service
organizations, Congress, medical school affiliates, VA
employees, local government entities, affected community
groups, Department of Defense, and other interested
stakeholders.
The CARES Commission began its journey in February of 2003
and in fulfilling our obligation, the commissioners visited 81
VA and Department of Defense medical facilities and State
Veterans Homes. We held 38 public hearings across the country
with at least one hearing per VISN. We held 10 public meetings
and analyzed more than 212,000 comments received from veterans,
their families, and other stakeholders.
On February 12th, 2004, I presented the CARES Commission
report to Secretary Principi. These findings were grounded on
the compilation of information gathered at these site visits,
public hearings, and meetings, as well as information obtained
from the public comments at the VA.
Mr. Chairman, the Commission established several critical
goals in order to sustain the highest standard of credibility
to our efforts.
First, we maintained an objective point of view in order to
give an effective external perspective to the VA CARES process.
We set goals to focus on accessibility, quality, and cost
effectiveness of care that were needed to serve our Nation's
veterans.
We held a clear line of sight on the integrity of the VA's
health care mission and its other missions.
Additionally, since the VA is more than bricks and mortar,
the Commission thoughtfully sought input from stakeholders to
minimize any adverse impact on VA staff and affected
communities.
It was the Commission's desire to make findings and
recommendations that would provide the VA with a road map for
strategically evaluating the VA's capital needs in the future.
During the development of the VISN planning initiatives and
ultimately the draft national plan, the VA CARES model, demand
model was the foundation for projecting the future enrollment
of veterans, their utilization of certain inpatient and
outpatient health care services, and the unit cost of such
services.
The Commission did not participate in the development of
the model or the application of the model at the VISN level.
The Commission's role, however, was to review data and analysis
based on the model.
And because the model was such an integral component in the
development of the CARES market plans, we wanted a high level
of confidence in the reasonableness of the model as an
analytical approach to projecting enrollment and workload.
For this reason and to foster the Commission's goal to
sustain credibility, the Commission engaged outside experts to
examine and explain the technical aspects of this model.
Based on the experts' analysis, the Commission found the
CARES model did, in fact, serve as a reasonable analytical
approach for estimating VA enrollment, utilization, and
expenditures.
However, there were lingering concerns noted in the
Commission's report relating to project utilization of
specialized inpatient and outpatient services, notably
outpatient mental health services, inpatient long-term care
services, including geriatric and seriously mentally ill.
To note, the model projected only certain inpatient and
outpatient services such as surgical services and primary care
services. And as has been noted before, there were shortcomings
in the model and these have been addressed in the report
extensively.
I would also add that the Commission made numerous
recommendations for immediate corrective action and development
of new planning initiatives.
Mr. Chairman, I hope that my testimony today will help to
inform the Subcommittee about the historical significance of
the Commission and its work. I will be happy to answer any
questions. Thank you.
[The prepared statement of Hon. Alvarez appears on p. 70.]
Mr. Michaud. Thank you.
Mr. Goldstein.
STATEMENT OF MARK L. GOLDSTEIN
Mr. Goldstein. Thank you, Mr. Chairman and Members of the
Subcommittee. Thank you for the opportunity to testify today on
the subject of the Department of Veterans Affairs and our
reports regarding the Department's Capital Asset Program and
CARES.
Through its Veterans Health Administration, the Department
of Veterans Affairs operates one of the largest integrated
health care systems in the country.
In 1999, GAO reported that better management of VA's large
inventory of aged capital assets could result in savings that
could be used to enhance health care services for veterans.
In response, VA initiated a process known as Capital Asset
Realignment for Enhanced Services, CARES. Through CARES, VA
sought to determine the future resources needed to provide
health care to our Nation's veterans.
My complete testimony describes, one, how CARES contributes
to VHA's capital planning process; two, the extent to which VA
has implemented CARES decisions; and, three, the type of legal
authorities that VA has to manage its real property and the
extent to which VA has used these authorities.
The testimony is based on GAO's body of work on VA's
management of its capital assets, including our 2007 report on
VA's implementation of CARES.
The findings from our recent work that addressed these
questions are as follows.
First, the CARES process provides VA with a blueprint that
drives VHA's capital planning efforts. As part of the CARES
process, VA adopted a model to estimate demand for health care
services and to determine the capacity of its current
infrastructure to meet this demand. VA continues to use this
model in its capital planning process.
The CARES process resulted in capital alignment decisions
intended to address gaps in services or infrastructure. These
decisions serve as the foundation for VA's capital planning
process.
According to VA officials, all capital projects must be
based on demand projections that use the planning model
developed through CARES.
Second, VA has started implementing some CARES decisions,
but does not centrally track their implementation or monitor
the impact of their implementation on mission.
VA is in varying stages of implementing 34 of the major
capital projects that were identified in the CARES process and
has completed eight.
Our past work found that while VA had over 100 performance
measures to monitor agency programs and activities, these
measures either did not directly link to the CARES goals or VA
did not use them to centrally monitor the implementation and
impact of CARES decisions.
Without this information, VA could not readily assess the
implementation status of the CARES decisions, determine the
impact of such decisions, or be held accountable for achieving
the intended results of CARES.
Third, VA has a variety of legal authorities available such
as enhanced use leases, sharing agreements, and other items to
help manage real property. However, legal restrictions and
administrative and budget-related disincentives associated with
implementing some authorities affect the VA's ability to
dispose and reuse property in some locations.
For example, legal restrictions limit VA's ability to
dispose of and reuse property in west Los Angeles. Despite
these challenges, VA has used legal authorities to help reduce
underutilized space.
In 2008, we reported that VA had reduced underutilized
space in its buildings by approximately 64 percent from 15.4
million square feet in fiscal year 2005 to 5.6 million square
feet in fiscal year 2007.
While VA's use of various legal authorities likely
contributed to VA's overall reduction of underutilized space,
VA does not track the overall effect of using these authorities
on space reductions. Not having such information precludes VA
from knowing what effect these authorities are having on
reducing underutilized or vacant space or knowing which types
of authorities have had the greatest effect.
According to VA officials, they plan to institute a system
in 2009 that will track square footage reductions at the
building level.
GAO is not making recommendations in this testimony, but
has previously made a number of recommendations regarding VA's
capital asset management. VA is at various stages of
implementing those recommendations.
Mr. Chairman, this concludes my testimony. I would be happy
to respond to any questions that you or the Subcommittee may
have.
[The prepared statement of Mr. Goldstein appears on p. 73.]
Mr. Michaud. I want to thank both of you very much for your
testimony this morning.
Mr. Alvarez, I want to especially thank you for your
testimony and for the excellent historical content you provided
the Subcommittee with under the original decisions of what
CARES has done.
You noted explicitly that some of the CARES Commission
findings may be outdated today because the information was
based on data from 5 years ago.
Would you recommend that we need to update CARES with a new
Commission? How should we update the original recommendations
of CARES?
Mr. Alvarez. Mr. Chairman, thank you.
At the time, the CARES Commission's work reviewed what had
been done and reviewed the model that was used. We felt it was
the best objective effort to date that the VA had undertaken.
Also, at the time, we felt that our review really surfaced
a lot of the current issues that were on the people's minds
around the country, not only the veterans, but the VA employees
and leadership as well.
There were a considerable number of recommendations that we
recommended go forward. To this date, I have been watching for
the last 5 years somewhat curiously as to the progress of the
plans.
And when I look at this process and compare it with the
BRAC process, the basic difference is that we were an
internally appointed Commission. And with that, we really did
not have much bite.
So my suggestion would be that if I compare that with the
BRAC where decisions were made and were held, that if you are
going to do this again, give the Commission's work to have some
bite and effect on the outcome and be realistic about it.
I thought a lot of our recommendations were pretty solid
and they were objective. But, again, without strong realistic
backing, they are just not going to go anywhere.
Mr. Michaud. During your discussion, when you put forward
the recommendation where some community-based outpatient
clinics should be located, was there ever any discussion over
the fact that the CBOC funding comes out of the VISN's
operating budget? This may create a situation where a VISN
Director might not want to lose operating money, and,
therefore, will not put forward a plan to implement what was
recommended under CARES? Was that ever part of the discussion
of the Commission?
Mr. Alvarez. Oh, I am sure it was, Mr. Chairman. Given the
discussions at the time with regard to the tremendous need for
outpatient care, we definitely saw that that was the way to go
in many parts of the country, particularly the rural areas.
And so there were many, many challenges that surfaced with
regard to doing that. One, of course, was what you described as
giving the local leadership the authority to go ahead and do
that.
And then, of course, there was really no priority across
the country in terms of the large requirement. The demand was
and the need was all over the country. It would have been
perhaps good if there was some way to come up with a priority
list, and if you had centralized funding construction, that
would have been perhaps helpful. But I do not know if that is
realistic or not either.
The other thing, of course, is that there was also the
possibility of looking at combinations of leasing, contracting,
and so forth with regard to the CBOCs. In addition, I am
pleased to say that what has surfaced is this super CBOC.
The HCCF that people referred to is, I think, a step in the
right direction in terms of meeting the challenges that you
mentioned with regard to how to fund the local CBOCs, while
addressing the local issues, the local hurdles, political, what
have you.
Mr. Michaud. My other question is, when you look where we
are today fiscally, with a debt limit to $12 trillion and with
our huge trade deficit and where we are heading as a country,
do you think it would make sense to, number one, look at the
recommendations under CARES to see if they are still valid
today and if not, update the recommendations? And after that is
done, would you think it would make more economic sense to
focus on the community-based outpatient clinics or access
points in areas of the country that have federally qualified
health care clinics so if you have an area where it is
recommended we have a CBOC, but there is a federally qualified
health care clinic using Federal dollars to build it, that it
would make more sense to actually work jointly with the clinic
or rural hospital?
Mr. Alvarez. I think it would be, to answer the first part
of your question, it would be probably a good exercise to look
at the basic work of the CARES Commission and update it to see
which parts have held true in terms of the purpose and the
analysis and to do this in an objective manner. I think that
would be probably a good exercise.
With regard to looking at other options with regard to the
CBOCs and outpatient care or perhaps a different form of
funding these or expanding the outpatient capability around the
country, it is probably good to look at that. I think what you
are really looking at is maybe thinking outside of the box in
terms of possibilities.
In addition to that, to what you mentioned with regard to
federally qualified health clinics and other ways of funding
it, we looked at this rural concept that was just surfacing at
the time and we really did not understand. But I think that is
something that has probably developed nicely now.
I think the important thing would be, which is what was
mentioned by the previous panel, is to communicate. Once you
have a good idea, communicate this with the stakeholders, the
veterans service organizations, and explain to them exactly
what your thoughts are and have an open dialogue on this.
We found this to be quite helpful in our meetings and in
our hearings around the country. A lot of people at the time
were very concerned that they were going to lose their
hospital.
But when they realized that, as Mr. Boozman indicated, 80
percent of care is done on an outpatient basis and that we
could take care of the individuals quite well in their
communities and not require the lengthy travel back and forth
and what have you, they were in general very positive.
This happened quite often in places in the western regions.
Walla Walla, for example, is a good example of a sort of remote
location in terms of talking about the local clinics, CBOCs
type concept, what have you.
So I think that these other ideas in terms of rural health
and other means of funding local clinics may work quite well,
but it has to be well communicated and get the cooperation of
the local veteran groups and other stakeholders.
Mr. Michaud. Thank you.
Mr. Goldstein, as you know, the VA continues to use the
tools developed through the CARES as part of its capital
planning process.
Do you think that the tools that they are using continues
to serve their purpose or are there modifications that are
needed within the VA to develop a more accurate tool to assess
what is happening out there within the VA facilities?
Mr. Goldstein. We are aware that they are still using the
tool that they developed some time ago and that it has been
useful to managing the program. Whether it needs a revamping is
not something that we have specifically studied at this point
in time.
Mr. Michaud. When you do your reports, do you think outside
the box? For instance, under the CARES process, as I mentioned
earlier, they might recommend that it be located at point X and
there might be a brand new federally qualified health care
clinic that is going to be built at point X. So when you do
your report, do you look at whether it makes more sense to have
a joint facility at point X for VA as well as a federally
qualified health care clinic or when you do your evaluation, do
you just focus on that issue?
Mr. Goldstein. We tend to look at the processes that were
undertaken by VA in conjunction with any of its partners, to
determine whether the process that they have is an effective
one for determining the best outcome.
We found in our work in Denver and Charleston that some of
the challenges and difficulties occurred when the process that
should have been used was not always used effectively.
So our approach would be to try and encourage the agencies
to use effective processes that are transparent and bring in
all the stakeholders so that agencies can make effective
decisions.
Certainly in the CARES process, we did note that VA did
look at most alternatives for most of the locations that they
were examining, but quickly ruled many of them out. It is just
a question of how that was adopted.
We noted in our report that in most instances, the
Secretary tended to agree with any option where the
recommendation was to either keep the facility open or to use
an enhanced use lease. However, the Secretary agreed only in
one case to close a facility. That was in Gulfport when both
the original plan as well as the Commission had suggested that
a greater number of facilities be closed.
And that may be a completely appropriate decision on the
part of the Secretary, but there did appear to be a lack of
transparency. In addition, it took a lot of time to make
decisions, and this affected local communities while decisions
were not being made.
Mr. Michaud. What would you recommend? How would we put
forward a model for new facilities that is fluid enough to take
into account the changing veterans' population as well as the
service needs out there and a model that would actually ensure
that VSOs are part of the process. Yes, VA talked to the VSOs,
but it was only to say that they talked to the VSOs. The VSOs
really did not feel part of the process.
What would you recommend for a model from here on out that
would really take into account the different issues that change
every day between now and whenever we get a facility built or
leased and that will actually really put the VSOs in a
situation where they can have really good effective input?
Mr. Goldstein. Mr. Chairman, we did not do work looking at
a specific model, but we did hear everywhere we went in all the
locations that we visited for our work there were a lot of
issues of communication.
These issues of communication were not just between the
Department and veterans' groups. They were also between the
Department and other stakeholders, local communities,
universities, other hospitals, other places that VA might try
to develop an effective health care solution, and that in many
instances, the kinds of actions that needed to occur to at
least get everyone in a room and suggest various ways to move
forward took a very long time and required the input of other
parties to ensure that VA was going to honestly come to the
table.
Mr. Alvarez. Mr. Chairman, if I may, on that question about
being heard, what we found in our experience is that giving the
local veterans' groups around the country the opportunity to
have input was not always a benefit because when you get into
these discussions, the level of knowledge required to provide
input was not always there as you see here in Washington and
others where you see that level of expertise, in the veterans
service groups themselves who have that tremendous level of
expertise, but that level of expertise is not always present at
the local level.
And, therefore, when they are invited to come in and
participate, they really cannot participate much beyond the
initial phases of these discussions. And that is one of the
issues that we always dealt with when we were having our
meetings and our hearings around the country.
Mr. Michaud. But by the same token--and actually it was
brought up by Mr. Weidman--and I can attest to that coming from
the State of Maine, where the Office of Rural Health was
concerned about a mobile vet clinic, and really did not think
that it was needed because when looking at a map, you could
easily get from point A to point B when, in fact, you cannot
get from point A to point B because of the distance and the way
the transportation system is located.
Here, actually, the VA at Togus made very clear that, yes,
it is a very rural area and you cannot get from point A to
point B. So, therefore, we were able to get the facility. But
it is that local input that really made the difference in that
particular case.
I can understand from what you are saying that sometimes
they might not know some other factors. But, quite frankly, if
you do not have local input along with the other factors, I
think you have to weed out some of the information that is
brought forward. It is that local perspective that is very
important.
Going through the CARES process now, I know there is one
VISN where they are going to hopefully have a CBOC. You
actually might be able to eliminate another access point that
was originally recommended by CARES, just by moving it around a
little bit. But it is that local input that definitely is
helpful.
By that same token, as I mentioned to the previous panel,
some of the concerns that I see are the political concerns,
especially when it comes to closing facilities. It might make
more sense to close facilities and reconfigure where the new
facility might be. That is, when you get into some of the
political problems in that particular area.
I am not sure how to really address that unless you have a
BRAC type commission that does that, but I am not recommending
it. That is just playing the devil's advocate for the first
panel, to see how they would respond to that particular area.
But I understand what you had mentioned, Mr. Alvarez, and
really appreciate your comments.
Mr. Goldstein. If I may, Mr. Chairman, VA, of course, is
not the only agency that suffers from what GAO euphemistically
calls competing stakeholder interests. Many agencies face this
very same problem.
And it is among the reasons why GAO years ago put real
property on the Federal high-risk list. It is one of five
issues that informed us that it was important for the
government to determine ways to deal with this because if it
does not, we are always going to be caught in this bind whether
it is VA, the Postal Service, or any other Federal agency.
Mr. Michaud. Thank you.
Once again, I want to thank both of you for coming. This
has been extremely helpful. We may have additional questions in
writing. I really appreciate your taking the time this morning
to come here to give us your thoughts and to answer the
questions. So, thank you both very much.
Mr. Goldstein. Thank you, Mr. Chairman.
Mr. Alvarez. Thank you, sir.
Mr. Michaud. I would like to ask the third panel to come
forward. Donald Orndoff, who is the Director of Office of
Construction and Facilities Management from the VA. He is
accompanied by Brandi Fate from the VA as well as Jim Sullivan
and Lisa Thomas.
I want to thank you very much for coming here this morning.
I look forward to your testimony. Hopefully, we will be able to
have an open dialogue as we move forward with the CARES process
on how we make sure that veterans have access to health care
facilities, regardless of where they live.
So, Mr. Orndoff, would you please begin?
STATEMENT OF DONALD H. ORNDOFF, AIA, DIRECTOR, OFFICE OF
CONSTRUCTION AND FACILITIES MANAGEMENT, U.S. DEPARTMENT OF
VETERANS AFFAIRS; ACCOMPANIED BY BRANDI FATE, DIRECTOR, OFFICE
OF CAPITAL ASSET MANAGEMENT AND PLANNING SERVICE, VETERANS
HEALTH ADMINISTRATION, U.S. DEPARTMENT OF VETERANS AFFAIRS;
JAMES M. SULLIVAN, DIRECTOR, OFFICE OF ASSET ENTERPRISE
MANAGEMENT, U.S. DEPARTMENT OF VETERANS AFFAIRS; AND LISA
THOMAS, PH.D., FACHE, DIRECTOR, OFFICE OF STRATEGIC PLANNING
AND ANALYSIS, VETERANS HEALTH ADMINISTRATION, U.S. DEPARTMENT
OF VETERANS AFFAIRS
Mr. Orndoff. Mr. Chairman, I am pleased to appear here to
discuss the status of the Department of Veterans Affairs health
care infrastructure.
I will provide a brief oral statement and request that my
full written statement be included in the record.
Mr. Michaud. Without objection, so ordered.
Mr. Orndoff. Joining me today is James M. Sullivan,
Director of VA's Office of Asset Enterprise Management; Lisa
Thomas, Director of VHA's Office of Strategic Planning and
Analysis; and Brandi Fate, Director of VHA's Office of Capital
Asset Management and Planning.
Current medical infrastructure. VA has a real property
inventory of 5,400 owned buildings, 1,300 leases, 33,000 acres
of land, and approximately 159 million gross square feet of
occupied space both owned and leased.
Our aging facilities were not designed to meet the
challenging demands of clinical care of the 21st century.
Continuing our recapitalization program is critical to
providing world-class health care to veterans now and into the
future.
Current major construction program. VA continues the
largest capital investment program since the immediate post
World War II period. Since 2004, VA has received appropriations
totaling $4.6 billion for health care projects, including 51
major construction projects.
These projects include new and replacement medical centers,
polytrauma rehabilitation centers, spinal cord injury centers,
ambulatory care centers, and new inpatient nursing units.
Background CARES. In 2000, the Veterans Health
Administration embarked on the Capital Asset Realignment and
Enhanced Services study or CARES. CARES assessed veteran health
care needs and promoted strategic realignment of capital
assets.
In 2003, VA released the draft national CARES plan and
created the CARES Commission for further analysis.
In May 2004, the Secretary published his CARES decision and
identified 18 sites whose complexity warranted additional
study. VA completed these studies in May 2008.
Today strategic planning facilities process. The tools and
techniques acquired through CARES are now incorporated in the
VA's strategic health care facilities planning process. VHA no
longer distinguishes between CARES and other project planning
needs.
Goal, high performance medical facilities. New VA medical
facilities contribute to world-class health care for veterans
today, tomorrow, and well into the 21st century. Our design
goal is to deliver high performance buildings that are
functional, cost efficient, veteran-centric, adaptable,
sustainable, energy efficient, and physically secure.
Our acquisition strategies. VA uses a range of acquisition
tools that are tailored to best satisfy the unique requirements
of each project. We partner with industry leaders through
architect engineer design contracts, design-bid-build
contracts, design-build contracts, integrated design-construct
contracts, construction management contracts, and operating
leases.
Fiscal year 2010 requirement. VA's fiscal year 2010 budget
request continues our recapitalization effort supported by our
strategic planning process. VA requests $1.1 billion in fiscal
year 2010 for major construction to replace or enhance VA
medical facilities. VA also requests $196 million authorization
to provide 15 new medical facility leases.
In closing, I thank the Committee for its continuing
support to improve the Department's physical infrastructure to
meet the changing needs of America's veterans. My colleagues
and I stand ready to answer your questions.
[The prepared statement of Mr. Orndoff appears on p. 82.]
Mr. Michaud. Thank you very much for your testimony.
As you heard from panel one, there is a lot of concern
about the lack of transparency in the capital planning process,
especially as it pertains to CBOCs.
It is my understanding that CBOCs come out of the VISN's
operating budget. That being the case, if you have a VISN
Director who might have other plans on what he wants to do
within his VISN, even though there is a need for a CBOC, they
will not proceed forward with that CBOC.
I think that is a disincentive to help move forward on
CBOCs, so my question is, number one, do you have any ways that
we might be able to address that? Should the CBOC operating
budget be a separate line item so we can actually move forward
with CBOCs within the CARES process? What would you do to bring
more transparency to the process?
As you heard from the first panel, they feel that they have
not been part of the process. In Maine, for instance, we have
the Department of Education where the Commissioner does not
decide they are going to do new school construction. It is the
State Board of Education that makes that decision.
Should we have an outside entity make the decision of where
the VA will be moving on these facilities and the VA just will
proceed forward with that recommendation?
Mr. Orndoff. Mr. Chairman, allow me to have Ms. Thomas
respond to the requirement's generation part.
Ms. Thomas. Mr. Chairman, I would like to address your
questions regarding the community-based outpatient clinics.
As of the end of March of this year, VHA has over 750
community-based outpatient clinics and they have treated
approximately 1.8 million veterans already. So I think that
those numbers alone show that it is not essentially a
disincentive for the Network Directors to use that tool to
enhance services to veterans in their local communities.
Mr. Michaud. I might add, how many have been built
recently?
Ms. Thomas. I can tell you that in fiscal year 2009, 13
have already been activated and there is another 62 planned for
this fiscal year.
Mr. Michaud. Another 62?
Ms. Thomas. Yes, sir, for a total of 75 in fiscal year
2009.
Mr. Michaud. Okay. And how many are left under the CARES
process to be moved forward?
Ms. Thomas. Sir, we have almost completely implemented all
of the CARES community-based outpatient clinics. We have 50
CBOCs that have opened in 13 networks and we have 78 of those
CBOCs in 14 networks that will open between fiscal year 2009
and 2011.
One of the other things that I would like to mention is
that we have over the past 2 years taken a national deployment
plan for our community-based outpatient clinics. So we have
more of a nationwide systemwide perspective. And the
methodology that we employ looks at looking at those areas of
the country that have limited access to care in combination
with those areas that have the highest projected demand for
services for both primary care and mental health services.
We then rank order those markets and present those to the
networks and ask them for the highest ranking markets, if they
could please develop a plan for how they are going to meet the
needs of veterans in those areas.
And that is a combination of CBOCs in addition to other
strategies that we have such as telehealth and mobile health
clinics and outreach clinics. So we have over the last 2 years
increased the rigor with which we look at where the CBOCs need
to be placed.
Mr. Michaud. In that process, what have you done to involve
the VSOs in those regions?
Ms. Thomas. My understanding is that within every network,
they have a structure in place to communicate with their
veterans service organizations and their representatives both
at the network level in terms of committees as well as the
local medical center level. We encourage every single medical
center and VISN to ensure that they are speaking with their
VSOs and incorporating their input into their strategic
planning processes.
Mr. Michaud. Is the process consistent among all the
different VISNs in how they deal with this or is it left up to
each VISN on how they are to involve the VSOs in their region?
Ms. Thomas. There is variability within the networks.
Different networks have varying governance structures. But I
believe we can certainly take that for the record and get back
to you with how each network does accomplish that.
Mr. Michaud. I did not mean to interrupt. If you could
finish answering my original question, which I think you mostly
answered.
Ms. Thomas. Oh, the transparency issue? I will pass that
back to Mr. Orndoff.
Mr. Orndoff. Well, the transparency issue, I think, is best
addressed, as Ms. Thomas said, in that there is a dialogue with
stakeholders at the local VISN and Central Office level.
We do have a continuing process of evaluating requirements and
setting the priorities for which projects would move forward,
as Ms. Thomas has talked about.
So it is always a challenge to communicate enough and we
try very hard to do that. Could we do better? Sure. We will
look for opportunities to do that.
Mr. Michaud. How are the concerns of local facilities
conveyed to the VISN office?
For instance, I will use Maine as an example. VISN 1 is
very large. You can put New England in the State of Maine. And
you have your Director at Togus and then you have your VISN 1
Director in Boston.
How are the concerns from the very local level, say the
Togus level, conveyed to the VISN level then ultimately
conveyed to the Central Office? Does the Central Office have an
opportunity to see what actually is really needed at the local
level or does that get cut off at the VISN level? Is this dealt
with consistently throughout the different VISNs?
Mr. Orndoff. Ms. Fate will answer, sir.
Ms. Fate. Thank you.
There are different programs that address the needs at the
medical centers. We have our nonrecurring maintenance (NRM)
program, which is a decentralized program that allows the VISNs
the control as to what decisions are made for renovation within
the existing medical centers. And each one of the VISNs has
their own process by which they prioritize their projects.
For the minor construction and the major construction
programs, those are at a centralized level where the needs are
brought forward to Central Office for capital assets. And
typically those mostly involve new construction. And we have a
model set for the criteria where each project is scored and
ranked.
And I do not know if, Jim, you want to present.
Mr. Sullivan. If we could, we have a large chart here that
will show you the prioritization methodology that is applied to
the major construction program as well as very similarly to the
minor construction program.
Mr. Michaud. Would it be possible if you could send that
also to the Committee----
Mr. Sullivan. Absolutely, sir.
Mr. Michaud [continuing]. Electronically?
Mr. Sullivan. Yes.
[The VA chart follows:]
[GRAPHIC] [TIFF OMITTED] T1866A.001
Mr. Michaud. Thank you.
Mr. Sullivan. This shows the criteria that is used to
determine which is the highest priority. So you can see, there
are seven parts of criteria starting with issues that address
safety, special emphasis which would be TBI, seriously mentally
ill, SCI needs, and then service delivery gaps, addressing
where those gaps are, your portfolio goals, that is getting rid
of unneeded space, vacant space, things along those lines.
The facility condition criteria references the large
backlog of deficiencies. We have a facility condition
assessment process that will tell you what each facility has,
how many deficiencies, and then workload, how much of a
workload gap is that investment addressing. And then last, is
it in alignment with the strategic plan of the Department.
And a similar process is used for decentralized programs,
which are minor construction and major construction.
Mr. Michaud. I wish I could say I could see it. The only
thing I can see is this is the year 2010 VA decision criteria
and that is it.
Mr. Sullivan. It is in the budget document.
Mr. Michaud. Okay.
Mr. Sullivan. But we will----
Mr. Michaud. Yeah. Thank you. I appreciate that.
My next question is, when you look at the CARES process,
some of the concerns that I and the Subcommittee have heard are
from our Members from all around the country and ever since I
have been here, we have received legislation to require the VA
to do more contracting out. The reason why we are seeing
legislation to contract out is veterans all around the country
are getting frustrated that they are not getting access to the
health care that they really need. And, hence, we are seeing
legislation to contract out.
I do not want the VA to become an insurance agency, that is
all you do is pass through. Part of the problem, I feel, is
because the CARES process has not been moved forward
aggressively, that is not necessarily the VA's problem in that
the previous Administration and previous Congress have never
provided the adequate funding needed to move forward on the
CARES process as originally recommended, the billion dollars a
year. So that is the lack of foresight among Congress and the
Administrations to move forward.
My question is, however, when you look at the CARES
process, there are a lot of access points without huge costs to
move forward. Has the VA looked at those access points where it
was recommended that they work collaboratively with the
federally qualified health care centers to move forward more
aggressively and get these up and running so that we can help
get the veterans the services that they need and hopefully
prevent any more legislation dealing with contracting out? Has
there ever been an overlay of where the needs are to CARES
compared to where we currently have other federally qualified
health care clinics?
Mr. Orndoff. Well, certainly the overall process of
identifying requirements covers the waterfront, all the
requirements. And where we have gaps, we certainly identify
requirements and the highest requirements through the process
that Mr. Sullivan just described would float up.
We have developed a comprehensive list of requirements for
the capital investments. They are in the fiscal year 2010
budget submission. There are 66 projects listed in priority
order as a result of this prioritization process.
What we have done is try to look for opportunities for
leasing a facility so we can get more projects moving faster.
So we have a two-pronged approach, capital investment as well
as leasing.
In terms of creative solutions that you have addressed,
certainly the opportunities as presented are explored and
discussed.
If there are other thoughts on the panel about that, let me
refer it to someone else.
Ms. Thomas. Sure. I can address a portion of that, Mr.
Chairman.
As we heard the gentleman from GAO report, they did a
report on VA and criticized us for not centrally tracking and
monitoring the implementation of CARES.
As a result of that, our Under Secretary for Health
chartered a work group. And that work group was a VA-wide body
that recommended a report be conducted annually to track both
the implementation and the impact of the CARES decisions.
One of those items that we are currently looking at is the
implementation of increased access points through contracted
care for any of those decisions that were identified in the
CARES document as well as the 18 follow-on business care
studies. So we will be tracking that and our first annual
report will be out this month.
Mr. Michaud. If you make sure that the Committee receives a
copy of that report----
Ms. Thomas. Absolutely.
[The VA subsequently submitted the report entitled, ``VA
Health Care: Implementation Monitoring Report on Capital Asset
Realignment for Enhanced Services,'' dated August 2009. The
report will be retained in the Committee files.]
Mr. Michaud [continuing]. It would be very much
appreciated. Under the process you mentioned, there are several
new CBOCs coming online.
In moving forward, what are you doing to try to really get
them aggressively moving forward? It is one thing to start the
process and say you are going to do it. Are there ways that we
can streamline that process to move them forward more
aggressively? Do we need to change something statutorily or can
you do it administratively? And if you can do it
administratively, are there bumps in the road that we should
look at administratively? How we can streamline that process to
get these facilities up and running?
Ms. Thomas. Mr. Chairman, I think there is always room for
improvement in terms of effectiveness and efficiency. And I
think that what I would like to do is take that question for
the record and consult with my colleagues and identify those
areas that can be streamlined. There are several levels of
review that go on both within VHA with the Department and with
OMB.
[The VA subsequently provided the following information:]
The current Community Based Outpatient Clinic (CBOC) Planning
process is aligned with the VHA Capital Planning and Budget
cycles as approved by the Office of Management and Budget
(OMB). Therefore, a 2-year planning scenario is required by
which CBOC proposals are submitted 2 years prior to their
planned activation date so that they are included in the
appropriate budget formulation cycle. For example, right now,
at the end of FY2009, the CBOCs that VHA plans to open in
FY2011 are under the review by OMB with VHA's budget
submission.
The CBOC process begins with a national analysis of the
underserved populations as defined by limited geographic access
in areas with projected increases in primary care and mental
health services. The Deputy Under Secretary for Health for
Operations & Management (DUSHOM) issues a call memorandum to
the Veterans Integrated Service Networks (VISNs) for CBOC
Business plan submissions for those areas of the country that
meet the national threshold for having underserved populations.
A technical review of each of these business plan proposals is
then completed. Those proposals meeting the technical
requirements are then reviewed by a CBOC National Review Panel
(NRP). The NRP reviews the proposed CBOCs against national
operations criteria. By June of each budget formulation year,
the National Review Panel recommendations are completed and
forwarded to the Under Secretary for Health and ultimately the
Secretary approval and inclusion into the Department Budget
Submission.
Mr. Michaud. Thank you.
Mr. Sullivan. I think, Mr. Chairman, one of the biggest
improvements has been the raising of the threshold that the
Committee successfully got through on the lease threshold.
It used to be we had to get leases authorized at 600,000.
For the first time with your help, it was raised to a million
and I think that will speed the process of bringing leases
online significantly quicker.
Mr. Michaud. I am sure it also will save time within the VA
system because I know Members of Congress constantly call to
find out where that project is in the system to try to move it
along. The more streamlined it is, I think the more efficient
it will be.
Actually, the first panel voiced serious concerns about the
HCCF leasing concept. Can you share the rationale behind that
leasing concept and the VA's plan to deploy that model? How
does the concept fit into the overall CARES process?
Mr. Orndoff. Yes, sir. As was mentioned, I think by members
of that panel, it is not a one size fits all or the ultimate
solution. It is one of a range of facility solutions that VA
intends to employ and address and tailor to the need at the
particular location.
What we are seeing is there are opportunities with the
shift in outpatient care that a very high percentage, as high
as 95 percent of the health care needs of veterans, can be met
in an HCCF environment as opposed to having full-blown
hospitals at each of these locations.
So in most cases or in some cases where we do not have
capabilities now, maybe the HCCF is the correct solution rather
than a series of community-based clinics or a large medical
center complex which can be, of course, from a capital
investment point of view very expensive.
What we are also looking to do with the HCCF is to deliver
these quicker than the normal capital process through leases.
And the budget in fiscal 2010, there are seven HCCFs for
authorization. Those projects would not be before you now if it
was not for leasing of the HCCF. So it is an opportunity to
reach down our priority list and move projects forward.
Because of limitations of leasing, operating leases,
working within the guidelines and policies of the Office of
Management and Budget, we do have some limits on leasing. And
so we are basically pressing the envelope a bit with HCCFs in
terms of getting leasing done for HCCFs within the leasing
authorities that we have. But we are certainly working with all
stakeholders to try to move forward on that.
Maybe Ms. Fate can embellish a little bit on when an HCCF
is the right facility solution.
Ms. Fate. We are currently in the process of fully defining
the HCC. While right now the services that are provided are
primary care, specialty care, mental health, expanded
diagnostics, and ambulatory surgery, we are using it as another
mechanism to provide the services that we do in VA.
It can be either through construction or through leasing,
but the avenue that we tested through the fiscal year 2010 was
to take seven projects through the major construction project
listing and try to push those forward through the leasing
process so that they could be done quicker as opposed to
sitting in priority 23 for the next several years and not
getting funded from the major construction.
So that was just our attempt to address the needs so that
our veterans do have a facility that is managed by VA health
care and providing the quality health care that we do at our
facilities.
Do you have anything?
Mr. Sullivan. Yes.
Mr. Chairman, I would like to add to that that the leases
the HCCs proposed in the budget, five of them are leases that
would normally show up in the construction list. With an $11
billion backlog, the theory behind this was to see if some of
those could be leases. For example, at Loma Linda, it was an
outpatient addition planned for construction.
The option here was to say could you lease a facility
across the street in the neighborhood right next to the medical
center where you could deliver that facility probably 6 to 8
years earlier than waiting for construction. That is one of the
advantages of HCCF.
So it is a way to get facilities, new and adequate
facilities quicker with our large backlog of facilities.
Because I think as Mr. Orndoff referenced, we are at an $11
billion backlog. And we know that is not the full backlog, but
that is probably a pretty good indicator of where we are.
And we have over $2.2 billion that are partially funded
that we need to finish before we can start more. So this was a
way to look at delivering facilities quicker and faster in this
budget.
So, I mean, that was the goal of this now. And also the
concept itself, as it applies to where we do not have
facilities now, is still being fully developed.
Mr. Michaud. When you look at that huge backlog and when
you look at the range in dollars from a CBOC to a large medical
facility and you look at the rural issues concerning veterans,
are you focused more on trying to build a brand new hospital or
is the VA looking at taking care of a hundred different needs
out there by doing CBOCs or access points? How do you judge
that priority?
When you look at the huge amount of money it costs to build
a multi-million dollar huge hospital, it makes a lot more sense
to me to instead take care of a lot of the smaller access
points out there where you can take care of a lot more veterans
for fewer dollars.
Mr. Sullivan. Right. We separate our infrastructure needs
out, that the $11 billion backlog is big, major, current
facilities that exist today. The CBOC process which provides
more flexibility is to address some of those smaller pockets of
need through that process. And there is a separate process Ms.
Thomas talked about in terms of how you prioritize those CBOCs.
The $11 billion is just basically our current infrastructure
stock and the repairs needed for that.
Ms. Thomas. I think part of your question, sir, is also how
do we identify what type of capital solution is appropriate for
the care that veterans need. And that is based upon services
and projected demand for those kinds of services.
So when you look at certain markets and you look for the
demand and the utilization out into the out-years, if the
predominant need of the veterans is for primary care or mental
health services, then it would be appropriate to look toward a
CBOC or a smaller access point to meet those needs.
If there is a large population of need for specialty care,
inpatient care, then that would help dictate what type of
infrastructure you would need, a larger health care center or a
hospital in that case. And then through the capital process, we
would work together to identify with the local network whether
or not the most cost-effective way to meet that would be
through a lease or construction.
Mr. Michaud. If you were to take care of all the needs that
are currently out there under the CARES process or that came
about after CARES--I am just talking about the smaller
facilities--what would that total cost be approximately?
Mr. Sullivan. In terms of the non-CBOC, it is about $12
billion in the major program. I believe the minor program is
$1.5 billion in terms of project backlog. And in the interim--
--
Mr. Orndoff. The FCA backlog is what, $8 billion?
Mr. Sullivan. Eight billion dollars. Now, there is some
overlap between the project backlog and the facility deficiency
backlog, but it is a large issue.
Mr. Orndoff. Sir, if I may address your point about either/
or, I think we are making an effort to do both. And we have a
different facility solution depending on the requirement.
I think there is a need to recapitalize the infrastructure
even for the major medical centers. There is a veteran need for
that level of care in certain high population areas. On the
other hand, certainly we want to make access available to
veterans in all locations, including rural areas.
So I think we are working all those fronts and the spectrum
of different types of facilities and different acquisition
strategies are all being put into play to try to address that
with all the resources available.
Mr. Michaud. Thank you.
Also on panel one there were co-authors of the Independent
Budget who had mentioned that VA's long-term care strategy
plan, released in 2007, was lacking in specific planning
details regarding the future direction in long-term care
programs.
Could you inform us what you are doing to develop a more
comprehensive, long-term care strategy plan? Where is that and
what have you done thus far?
Mr. Orndoff. Mr. Sullivan or Ms. Thomas.
Ms. Thomas. Mr. Chairman, VA is working on a population-
based model to project the long-term care needs for both
residential and noninstitutional long-term care services for
the needs of our enrolled veteran population.
As is the cornerstone of our planning, the enrollee health
care projection model or actuarial model, which the other
panels had referenced is really the cornerstone for strategic
planning. And VA has made progress to develop a long-term care
model that is similar in rigor and assistance that those kinds
of tools can provide us in planning.
I do know that there has been progress in the long-term
care planning since the last time they had submitted an
official plan to Congress. And we would be happy to get those
experts to clarify exactly what steps they have made in terms
of improving that.
[The VA subsequently provided the following information:]
The Geriatrics and Extended Care (GEC) Strategic Plan was
approved by the Acting Under Secretary for Health on September
2, 2009. The plan responds to the challenges facing VA given an
increase in the age, number and medical complexity of elderly
veterans, and the appearance of a younger, more health-savvy
cohort of veterans with immediate and future extended care
service needs; and a U.S. health care workforce underequipped
to care for those with chronic diseases and disabling
conditions.
The GEC Strategic Plan specifies four goals to be achieved
through 10 strategies, and 82 recommendations. The most
critical of these recommendations include: ensuring patient-
centeredness of programs; analyzing the cost/benefit of long-
term care policies; ensuring a focused and dynamic research
program; building national partnerships; appointing a GEC lead
for each VISN; developing a practical means of tracking
veterans served by GEC programs; and appointing a GEC Workforce
Advisory Council of senior VHA leadership to address workforce
inadequacies. Implementation of the GEC Strategic Plan covers a
7-year planning horizon.
Mr. Michaud. When you do your planning, whether it is for
CBOCs or long-term care planning, are you involving not only
the VSOs but other State entities?
I am very pleased with the State Veterans Nursing Home in
Maine. They have a facility. They have been approved for a
brand new community-based outpatient clinic on the same campus.
They are going to have a hospice facility there on the same
campus as well as low-income housing for our veterans.
So, all on the same campus, you have a community that
offers the whole continuum of care, and a lot of that was
because of the leadership of the State Veterans Nursing Home.
When you are doing your planning process, are you not only
involving the VSOs but also other entities that might be out
there that could help move forward in a particular area?
Ms. Thomas. Yes. The answer is yes, Mr. Chairman. Both at
the local level and at the national level, our geriatrics and
extended care service line does very much look to partner and
learn from the private industry and our local communities.
One of the large changes that we recently made is we no
longer refer to our nursing homes as nursing homes. They are
now CLCs or community living centers. And looking toward the
innovative strategies that others have developed in terms of a
greenhouse and approaches like that where they are real living
communities and a sense of a community and not an
institutional-like setting for those of our veterans who need
long-term care.
We are always looking for input from our partners, our
veterans service organizations and all of the stakeholders. I
think that is a very important ingredient to strategic
planning, particularly for this population.
Mr. Michaud. Thank you.
Also on panel one, we heard some concerns about the lack of
transparency and the lack of involvement from the VSOs.
What do you think that you can do better to make sure that
all the stakeholders are at the table and that their concerns
are heard in a meaningful way, not just to bring them in and
say we have talked to them, that is the end of it? What can you
do to address some of the concerns that we heard from panel
one?
Mr. Sullivan. I think one thing, Mr. Chairman, on the major
construction area that we will brief them and sit down with
them and talk to them about our prioritization process, how
projects get into it, why projects are where they are on the
priority list so they can have an understanding of where things
are for a particular project and how there is a straightforward
prioritization process.
Congress required us to do it back in the early 1990s and
we have refined it. Maybe it needs to be more fully briefed to
the VSOs and others so they can see at least what the decision
process is.
The process was put together to be transparent so you could
find out why a project is ranked particularly higher than
another or why one is not ranked higher. And maybe that is an
education process that is incumbent on us to more fully explore
with those elements. And we will do that.
Mr. Michaud. What you just described does not really
involve them. It is pretty much here is the decision and here
is how we came to that decision.
I think, if I understood correctly from panel one, they
would like to be involved in that process, before you make the
decision not to say ``here is a decision, here is what we have,
and this is how we arrived at the decision.'' I think they want
to be part of that process in moving forward before the
decision is made. That is the meaningful input that they want.
Mr. Sullivan, what you have told me is pretty much, I
think, what they have been complaining about: here is a
decision, take it or leave it. If you like our methodology, or
dislike it, that is what you have to live with. I think they
want to be part of that process, not after the fact. So----
Mr. Sullivan. Sir, we will take that back to the Secretary
and discuss that option of finding a way to involve them in
that process.
Mr. Orndoff. Sir, I think the opportunity to influence the
project selection process is basically the process that we used
to develop this chart over here which says, you know, what are
the things that are important that should be weighted more
heavily that float to the top.
So I think there is an opportunity that we could take to
discuss that in the development process. It is an annual cycle
of refreshing that to make sure it is aligned with the current
strategic vision of the Secretary.
So as a step in that process, we could have a dialogue
there that would influence the model that eventually produces
the list. That way, we can all have some ownership in the
outcome.
Mr. Michaud. I would appreciate it because some of the
frustration that I have heard and seen over the years is a
desire to really be part of that ownership.
I know at times, that probably might delay things a little
bit or might be frustrating at times, but, quite frankly, I
think any time that you can work with those that are involved
in the process, it has long term benefits. And I think it gets
rid of a lot of the frustrations that we have heard today and
hopefully in the future.
As I mentioned earlier, I think part of the problem in the
past has been that VA lacked the financial resources needed to
move forward on this in an aggressive manner. It is my hope
that with the new Administration and new Congress that we will
definitely look forward in this particular area.
My only disappointment is in the stimulus package, the
funding for the VA got cut. The additional increase actually
got cut from the original request that we had. Hopefully we
will be able to move forward with giving the VA the resources
they need so you can move forward to take care of our veterans.
I guess my last question would be, if there is anything
that Congress could do, other than provide additional resources
to help make your job a lot easier so we can move forward more
aggressively as we look at the CARES process and how we can
meet the facility needs? Is there anything that we can do or
should do?
Mr. Orndoff. Sir, I am not aware of any legislative
proposals that we have for specifically in the area of
capitalization of projects. We do appreciate the raising of
thresholds as was mentioned for leasing. That certainly
facilitates that process moving forward.
We have a budget, a robust budget before you of $1.2
billion for major construction, which is a high watermark. And
we, you know, of course, would appreciate support for that
going forward.
Any other issues that anybody on the panel has?
[No response.]
That is all I have, sir.
Mr. Michaud. Well, once again, I want to thank you. There
will be additional questions for the record.
I do want to thank you for your testimony this morning, for
answering the questions. Hopefully, you will take seriously the
comments made by the first panel about their involvement up
front, not at the end, because I have been here 7 years and I
hear a lot of concerns about the VSOs being able to
meaningfully participate in the process.
Anything you can do to open that up to make it more
transparent, would definitely be very helpful. I look forward
to working with you, and I want to thank each and every one of
you as well as your staff for what you do for our veterans in
this great Nation of ours.
I think all too often elected officials tend to criticize
the VA because of a lack of services for our veterans, but I
want to thank you for what you do for our veterans, not only
the four of you, but also your staff as well. I really
appreciate it very much.
So without any further questions, I now adjourn the
hearing. Thank you.
[Whereupon, at 12:49 p.m., the Subcommittee was adjourned.]
A P P E N D I X
----------
Prepared Statement of Hon. Michael H. Michaud,
Chairman, Subcommittee on Health
The Subcommittee on Health will now come to order. I would like to
thank everyone for attending this hearing. Today's hearing marks the 5-
year anniversary of the CARES decision, otherwise known as Capital
Asset Realignment for Enhanced Services.
The purpose of this hearing is to assess the VA's implementation of
CARES and to investigate the effectiveness of CARES as a capital
planning tool. In addition, today's hearing will explore whether CARES
should continue in the future or if the VA should adopt an alternate
capital planning mechanism.
When the VA embarked on the CARES process 5 years ago, the VA's
health infrastructure was thought to be unresponsive to the needs of
current and future veterans. While about 24 percent of the veteran
population was enrolled in the VA for health care, the CARES plan
assumed that the enrollment population would increase to 33 percent by
the end of 2022. In addition, there were concerns about the ability of
the existing health infrastructure to meet the demands of the aging
veteran population who opt for warmer climates in the south and the
southwest.
CARES was intended to eliminate or downsize underused facilities,
convert older massive hospitals to more efficient clinics, and build
hospitals where they are needed in more populated areas. In essence,
CARES was to direct resources in a sensible way to increase access to
care for many veterans and to improve the efficiency of health care
operations across VA facilities.
Over the years, there have been challenges of implementing the
CARES decision in numerous locations. Most notably, the VA has reversed
the CARES decision under the leadership of different VA Secretaries.
Too often, we hear stories of veterans who have been waiting for new
facilities for 10 or more years. In addition, there is a new concept of
Health Care Centers which provide primary and specialty care and is a
hybrid of a CBOC and a full-fledged hospital. Because this is a
relatively new concept which the VA is rolling out, it is important
that we fully understand how this fits in with the overall CARES plan.
I look forward to hearing the testimonies of our panels today, as
we determine the path forward in continuing to build a strong health
infrastructure for the VA.
Prepared Statement of Hon. Henry E. Brown, Jr.,
Ranking Republican Member, Subcommittee on Health
Thank you Mr. Chairman.
Today, more than 80 percent of the primary, specialty, and mental
health care our veterans need can be provided in an outpatient setting.
Yet, much of the Department of Veterans Affairs (VA) health care
infrastructure was built more than 50 years ago, when VA care meant
hospital care.
A review of VA real property by the Government Accountability
Office (GAO) in 1999 found that VA was wasting a million dollars a day
on the maintenance of outdated and underutilized health care
facilities.
In response to this report and in recognition of the need to update
facilities to deliver 21st century care, VA established the Capital
Asset Realignment for Enhanced Services (CARES) process. CARES was
designed to be a capital planning blueprint for the future--to
modernize and better align VA's health care facilities with the
changing veteran population.
The CARES Commission identified several ways to improve access and
enhance quality of care including increasing collaborative partnerships
with the Department of Defense and VA's academic affiliates.
Specifically, in my home State of South Carolina, the CARES
Commission supported a concept for a joint venture with the Medical
University of South Carolina (MUSC) and the Ralph H. Johnson VA medical
center in Charleston. The Secretary's May 2004 CARES Decision also
stated that ``VA will continue to consider options for sharing
opportunities with the Medical University of South Carolina.''
Since the leadership of MUSC came to VA with this proposal more
than 6 years ago, I and this Committee have taken significant steps to
study and move forward with this historic opportunity to establish a
new innovative model of care. The ``Charleston Model'' would ensure
high-quality health care for veterans in the Charleston area and could
be leveraged to improve access to care in other areas. A significant
milestone was reached in advancing the project with the passage of
Public Law 109-461, the Veterans Benefits, Health Care, and
Informational Technology Act of 2006. Section 804 of this law
authorized $36.8 million for VA to enter into an agreement with the
MUSC to design, construct and operate a co-located, joint-use medical
facility in Charleston, South Carolina. However, much to my dismay, the
VA has not yet set aside any funding to implement the law.
As we evaluate the effectiveness of CARES, it is also vital that we
re-evaluate the importance of collaborative partnerships. Building on
the close relationships that VA already has with medical schools across
the Nation is a powerful tool that VA can use to achieve greater health
care quality and further efficiencies, while still preserving the
identity of a veterans' health care system.
I look forward to our discussion today, and yield back the balance
of my time.
Prepared Statement of Joseph L. Wilson, Deputy Director,
Veterans Affairs and Rehabilitation Commission, American Legion
Mr. Chairman and Members of the Subcommittee:
Thank you for this opportunity to present The American Legion's
views on the future of the Department of Veterans Affairs (VA)
infrastructure. It is The American Legion's position that Congress keep
in mind the importance of continuity of care during a servicemember's
transition from active duty to the community.
Within the VA medical system are various divisions that accommodate
a high demand of services, to include extended care and rehabilitation,
mental health, pharmacy, primary care, research, social work, spinal
cord injury (SCI), and women's health. Quality care throughout those
divisions may be hindered when buildings that house them aren't
equipped to accommodate and/or sustain modern technologies and
medicines.
Since the late 1990s, VA has gone through a critical transformation
in its shifting from primarily hospital-based care to outpatient care.
As the transition occurred, VA's infrastructure surpassed obsolete.
This brought about the Capital Asset Realignment for Enhanced Services
(CARES) process in 1999. This process was implemented to enhance
outpatient and inpatient care and special programs, to include SCI,
blind rehabilitation, seriously mentally ill and long-term care through
proper upgrading, sizing, and location of VA facilities. However, once
CARES was underway, the Commission did not include mental health and
long-term care needs in its final recommendations, due to the lack of
sufficient data. As a result, all of the facilities identified for
closure were providing nationally recognized mental health and long-
term care services.
In 2004, the VA completed the CARES process, which called for
critical construction needs for outdated VA hospitals and clinics
throughout the Nation. The Secretary of VA reported Congress would have
to include $1 billion annually for 6 years to ensure the success of
CARES. The American Legion has recommended the same figure in its
annual budget recommendation since the CARES decision. Due to lack of
funding over the years, it is believed VA has been playing fiscal
catch-up.
Although the VA had begun implementing CARES decisions, a
Government Accountability Office (GAO) report found implementation was
not being centrally tracked or monitored to determine the impact the
CARES process has or hasn't had on the mission. GAO was also tasked
with examining how CARES contributes to the Veterans Health
Administration (VHA) capital planning process; the extent to which the
CARES process considered capital asset alignment alternatives; and the
extent to which VA had implemented CARES decisions and how the
application has helped VA carry out its mission.
Through CARES the VA developed a model to estimate the demand for
health care services, as well as ascertain the capacity or availability
of infrastructure to meet the demand. It was the recommendation of the
VA to meet future health care demand by building medical facilities and
opening more Community Based Outpatient Clinics (CBOCs).
GAO further examined the CARES process by other means such as
conducting six site visits to VA facilities in Walla Walla, El Paso,
Big Spring, Orlando, Pittsburgh, and Los Angeles.
They found critical infrastructure problems at the following
facilities:
Walla Walla-The facility was in poor and dilapidated
condition, to include buildings that dated back to the early 1900s.
They also discovered lead-based paint and seismic issues.
Greater Los Angeles-Infrastructure and life safety issues
were discovered as well as seismic structural deficiencies for some of
the old buildings. Most of the buildings also required major repairs,
including seismic and structural upgrades, with the main hospital
building at ``exceptional'' high risk for earthquake damage.
Orlando-The Orlando facility had the greatest
infrastructure need of any ``market'' in the country. The new facility
is transitioning from that which accommodated 90,000 veterans to a
population of 400,000.
Pittsburgh-Buildings at the Pittsburgh Highland Drive
facility were found in poor condition and not designed for modern
medical health care.
As a result of the GAO report, it was recommended that VA provide
the information necessary to monitor the implementation and impact of
CARES decisions. It was also recommended VA provide outcome measures
that report the progress of CARES as it relates to access to medical
services for veterans.
Since Fiscal Year (FY) 2002, approximately 945,423 Operation
Enduring Freedom/Operation Iraqi Freedom (OEF/OIF) veterans have left
active duty and become eligible for VA health care. Approximately 51
percent of the returnees were active duty, while 49 percent were
Reserve and National Guard. Many are also returning with various
injuries and illnesses, to include Traumatic Brain Injury (TBI), SCI,
Blind Eye Injury, Post-Traumatic Stress Disorder (PTSD), and Loss of
Limb(s), to name a few.
The American Legion presents the above-mentioned numbers to evoke
to the Congress and other pertinent affiliates to determine the
adequacy, or lack thereof, of care to veterans when there is lack of
funding and/or inadequate accommodations; namely infrastructure that
houses VA services.
While the decision to assess and plan, and construct or reconstruct
VA medical facilities has been underway since the CARES decision in
2004, the aforementioned figures also suggests veterans' issues have
and continue to increase. With the average age of VA facilities
remaining at 49 years, The American Legion questions whether these
facilities can sustain new medical technology for years to come. During
that time, we must remain conscious that veterans' issues are patterned
to rise. It is therefore imperative Congress support the demand for
timely construction of these facilities.
It is the position of The American Legion that during the
improvement/enhancement of VA facilities, a base for health care
services must not only be maintained, but must be increased to
accommodate influxes. In order for the CARES plan to work successfully,
there must be adequate funding to accommodate every project as
implemented by the Commission. To play fiscal catch-up from this point
will adversely affect the intent of the CARES project, VA
infrastructure, and all veterans who rely on VA health care.
The American Legion also supports the mission of the CARES
initiative, if it provides a continuous up-to-date infrastructure for
an ever-changing veterans' community; however, we express dissent and
concern if the intent is aimed at an effort to reduce VA expenditures
under the pretext of cost-savings without regard to the needs of the
veterans' population.
In response to a recent GAO report, VA concluded it did not have
sufficient information to complete decisions throughout VA for various
services like long-term care and mental health. In order to assess the
need for the appropriate infrastructure, VA must collect actual numbers
of veterans' demand for health care and services.
Other shortcomings included, specifically, the lack of sufficient
information on the numbers of veterans who were to seek long-term care
and mental health services from VA on a daily basis. Since 2004, VA has
maintained that its models were inadequate to forecast demand. In order
to be successful, VA must address key challenges, to include developing
information to complete various service alignment decisions.
Finally, the preparation to construct and/or reconstruct VA medical
facilities must be planned in accordance with service alignment
decisions to fulfill the promise of continuity of care and prevent
other inadequacies, such as fragmentation of care throughout the women
veterans' population.
The American Legion maintains that the CARES implementation process
must be an open and transparent process that continually and fully
informs the Veterans' Service Organizations of CARES initiatives,
criteria, proposals and timeframes. This also includes an accurate
assessment of the demand for all medical services which gauges how much
infrastructure is required to accommodate this Nation's veterans.
Through this form of checks and balances, the maintenance of
quality stands to uphold the effectiveness of CARES as it pertains to
strategic planning and the future of the entire VA system.
Mr. Chairman and Members of the Subcommittee, The American Legion
sincerely appreciates the opportunity to submit testimony and looks
forward to working with you and your colleagues on the above-mentioned
matters and issues of similarity. Thank you.
Prepared Statement of Carl Blake,
National Legislative Director, Paralyzed Veterans of America
Chairman Michaud, Ranking Member Brown, and Members of the
Subcommittee, Paralyzed Veterans of America (PVA) would like to thank
you for the opportunity to present our views today on the Capital Asset
Realignment for Enhanced Services (CARES) report. Given that it has
been 5 years since the CARES report was released, we believe this is a
good benchmark period to review the progress that the Department of
Veterans Affairs (VA) has made in implementing its recommendations. We
also recognize the need to assess whether or not those recommendations
remain an appropriate tool to align VA's health care infrastructure to
meet the current and future demands on the system.
PVA would like to focus much of our discussion on how the CARES
recommendations targeted the needs of our members--veterans with spinal
cord injuries or dysfunctions (SCI/D), such as Multiple Sclerosis. We
will outline the current status of CARES Commission recommendations
with regards to SCI/D. Finally, we will discuss the outcomes of the
CARES report regarding the realignment of VA infrastructure to meet
changing demand for care and the value of the CARES methodology for
determining current and future medical care workload and future demand
for services.
Delivery of Care Through the SCI System
In reflecting on the CARES report, we believe that the health care
concerns of veterans with catastrophic disabilities, and particularly
veterans with spinal cord injury or dysfunction, were adequately
addressed. The report included recommendations that significantly
improved the capacity for VA to meet this demand while addressing
barriers to access at the same time. Emphasis was placed on expansion
of the SCI hub-and-spoke delivery model to fill geographic gaps in SCI/
D services. Additionally, the report made timely recommendations for
SCI/D long-term care designed to be a first step toward meeting the
demands of aging veterans with SCI/D.
Specifically, the CARES Commission called for the construction of
four new SCI centers in the VA system. Locations targeted for new SCI
centers were Syracuse, New York (VISN-2); VISN-16 (this location was
later pinpointed to Jackson, Mississippi by VA and PVA officials);
Denver, Colorado (VISN-19); and, Minneapolis, Minnesota (previous VISN-
23).
As to the status of these projects, the Syracuse SCI center is
currently in the planning phase. A 30-bed unit is being planned for
this location. We feel confident that this new SCI center will be a
state-of-the-art facility that will certainly meet the needs of
veterans in that region. PVA is also extremely pleased that the new 30-
bed Minneapolis SCI center officially opened last fall and became fully
operational in February 2009.
The CARES plan also called for a 30-bed facility in VISN-16. Prior
to the release of the final CARES report, the Draft National Cares Plan
(DNCP) supported the North Little Rock VA facility in VISN-16 for
location of an SCI center. However, the Commission recognized that
North Little Rock did not provide the full range of tertiary care
services required by VA to be a proper site for an SCI center. Since
that time, Jackson, Mississippi, has been identified as the optimal
location for that VISN. While this recommendation has not been advanced
at this time, PVA's Architecture Department has been informed by the VA
that it intends to request funding to begin this project in FY 2011.
With regards to Denver, the Subcommittee is probably aware that it
has been a long and difficult process to determine what the health care
infrastructure plan for this region would be. The CARES plan called for
a 30-bed SCI center to be located at a new Denver VA medical center to
be built on the Fitzsimons Campus. However, the larger facility
planning process moved forward in fits and starts. The plan for Denver
has taken many controversial turns, spread out over many years, with no
plan being more troublesome that the new plan released in early 2008 by
then VA Secretary James Peake. Secretary Peake's plan would have used
Denver as the model for the new Health Care Center Facility (HCCF)
Leasing Program.
Fortunately, significant pressure from the VSO community in
Colorado along with strong support from the Congressional delegation
put a hold on this program in Denver. PVA was very pleased with the
VA's announcement in March that a new stand-alone hospital will be
built on the Fitzsimons Campus, and a new SCI center will be included
in that facility. Current VA Secretary Eric Shinseki also pledged in
March to see that this project is completed by 2013.
The CARES report also called for the relocation of the SCI center
located in Castle Point, New York (VISN-2) to the Bronx. However, this
relocation was contingent upon the VA expanding the infrastructure at
the Bronx SCI center. The plan then called for Castle Point to become
an SCI long-term care facility. Currently, the Castle Point facility is
under renovation. Meanwhile, the Bronx facility is being replaced with
a 92-bed SCI center that will include 46 SCI long-term care beds.
Additionally, CARES called for the placement of an SCI outpatient
clinic in VISN-4. SCI outpatient clinics, such as the one recommended,
serve as spokes in the hub-and-spoke SCI system model. The VA embraced
this recommendation and has since opened an SCI outpatient clinic in
Philadelphia, Pennsylvania.
Finally, the CARES report called for adding 20 additional SCI acute
care beds in Augusta, Georgia (VISN-7). Under this plan, the VA was to
add 11 acute care beds immediately with 9 beds to be added by FY 2012.
Our Architecture Department has informed us that the additional 11 beds
are currently under construction and should be operational within the
next few months. The additional 9 beds have not been formally designed,
and no funding for this expansion has currently been requested. While
the VA did not move on this recommendation as quickly as we would have
liked, PVA is pleased to see that the VA is finally addressing this
issue.
Long-Term Care Considerations
PVA was pleased that the final CARES Commission report included
several recommendations for the expansion of long-term care services
directed at spinal cord injured veterans. Prior to the CARES
initiative, the VA system of care only provided 125 long-term care
staffed nursing home beds dedicated to veterans with spinal cord
injury. These SCI long-term care beds were located in four VA
facilities--Brockton, Massachusetts; Hampton, Virginia; Castle Point,
New York; and, Hines VA medical center in Chicago, Illinois.
Interestingly, the VA had no institutional long-term care beds for SCI
veterans located west of the Mississippi River.
While some progress has been made to expand VA's capacity for
dedicated SCI long-term care, much work remains to be done. The CARES
report called for an additional 100 SCI long-term care beds systemwide
to expand capacity and improve admission wait times experienced by SCI
veterans. Despite the CARES recommendations to increase SCI long-term
care capacity, we believe that particular emphasis needs to be placed
on expansion into the western United States.
The CARES Commission recommended 30 SCI long-term care beds to be
located in VISN-8. PVA is pleased to report that 30 SCI long-term care
beds have been placed adjacent to the SCI center located at the Tampa
VA medical center and they are fully operational.
The Commission also recommended 20 SCI long-term care beds to be
located at the SCI Center in Memphis, Tennessee (VISN-9); 20 SCI long-
term care beds at the Cleveland VA medical center (VISN-10); and 30 SCI
long-term care beds in Long Beach, California (VISN-22).
These three sites are in various stages of the planning process.
The long-term care beds at Cleveland are currently under construction,
and the final project will actually include 26 beds. This facility is
anticipated to be operational by late 2010. The VA is also moving
forward with the Memphis recommendation and is currently in the
planning phase. Preliminary architectural plans have been reviewed and
commented on by PVA.
The 30-bed long-term care plan for Long Beach has faced significant
delays primarily related to space restrictions. However, PVA's
Architecture Program has developed a conceptual plan to convert a
currently unused portion of the existing facility into a 17-bed SCI
long-term care unit. While this is actually a PVA recommended solution
to part of the demand problem at Long Beach, we believe it is a step in
the right direction. We remain hopeful that VA will agree with this
recommendation while working aggressively to establish the entire 30-
bed unit recommended by CARES. We would encourage the VA and Congress
to conduct aggressive oversight to ensure that the VA is moving forward
on these critical projects expeditiously.
Additionally, PVA would like to revisit a significant problem
concerning the difference between acute SCI center care and SCI long-
term residential care that evolved as the CARES Commission process
moved forward. As the Commission continued its fact finding work it
became clear to PVA that the Commission had blurred the distinction
between acute SCI care and SCI long-term residential care.
As the Commission made investigative visits throughout the VA
health care system, some members of the Commission were concerned with
their observations concerning low occupancy rates at SCI Centers. In
fact, the Special Disability Program section of the Executive Summary
of the Commission's final report quoted current occupancy rates among
VA facilities with SCI/D units as ranging from approximately 52 percent
to 98 percent. PVA felt at the time that this impression led the
Commission to concoct ways of filling unused SCI acute care beds with
SCI long-term care patients.
One of the significant problems identified during the early stages
of the CARES process was the exclusion of long-term care, including
nursing home, domiciliary and non-acute inpatient and residential
mental health services, in its projections due to the absence of an
adequate model to project future need for these services. This problem
can still be seen in the flawed budget development for long-term care
identified by the Government Accountability Office in its report
released in January 2009: VA Health Care: Long-Term Care Strategic
Planning and Budgeting Need Improvement (GAO-09-145). Despite the lack
of adequate data the CARES Commission made several recommendations
regarding VA long-term care:
1. Prior to taking any action to reconfigure or expand long-term
care capacity or replace existing facilities, VA should develop a long-
term care strategic plan. This plan should be based on well-articulated
policies, address access to serv-
ices, and integrate planning for the long-
term care of the seriously mentally ill.
2. An integral part of the strategic plan should maximize the use
of State Veterans Homes.
3. Domiciliary care programs should be located as close as
feasible to the population they serve.
4. Freestanding long-term care facilities should be permitted as
an acceptable care model.
5. VA should implement the VISN-specific recommendations for
upgrading existing long-term care and chronic psychiatric care units,
recognizing that some renovations are needed to improve the safety and
maintenance of the facilities' infrastructure and to modernize patient
areas.
In 2007, VA released a copy of its Long-Term Care Strategic Plan
that, in the opinion of the co-authors of The Independent Budget, was
lacking in specific planning detail regarding the future direction of
its long-term care program. In 2008, PVA understood that VA was working
on the development of a second, more comprehensive, Long-Term Care
Strategic Plan; however, to the best of our knowledge that followup
plan has never been released. We would encourage the Subcommittee to
investigate this issue further. The CARES Commission emphasized in its
final report, that strategic planning for aging veterans and veterans
with serious mental illness will be essential going forward.
Meeting Future Health Care Demand
The Subcommittee has posed the question about the viability of
CARES in assessing the future health care needs of veterans. As pointed
out in The Independent Budget for FY 2010, despite the fact that CARES
was completed in 2004, the VA continues to assess its needs and
priorities for infrastructure by using concepts derived from the CARES
model.
PVA actually sees this question as being one about whether or not
the CARES recommendations made then appropriately address new demands
on the system, particularly as it relates to the younger generation of
veterans returning from Operation Enduring Freedom and Operation Iraqi
Freedom. Moreover, the question seems to suggest that CARES did not
take into account that new demand seems to be growing in rural
communities and that the infrastructure changes outlined by CARES do
not reflect this change.
While we certainly understand this concern, we believe that the
CARES model appropriately addressed where the greatest demand for care
comes from. Moreover, the CARES model provided a blueprint for aligning
VA's infrastructure to best meet the needs of the most veterans
possible. Existing statutory authority, particularly Fee-for-Service,
allows the VA to address health care demand and need outside the
immediate infrastructure alignment. Furthermore, recognizing that
certain demand has changed since 2004, the VA has moved forward on
other major and minor construction initiatives outside of the CARES
recommendations.
Recent activities of the VA seem to suggest that it might like to
address health care demand outside of its infrastructure alignment,
whether justified or not. As mentioned earlier, PVA, and many of its
VSO partners, expressed serious concerns about the VA's HCCF leasing
program developed under Secretary Peake. Under the HCCF, the VA would
lease larger outpatient clinics (often referred to as super-CBOCs)
instead of investing in new major construction initiatives. These large
clinics would provide a broad range of services, including primary and
specialty care as well as outpatient mental health services and same-
day surgery. This proposal seemed to outline a different approach that
some senior leadership in VA wanted to take in expanding health care
capacity in the future.
However, as expressed in The Independent Budget, the HCCF leasing
program has serious flaws that do not necessarily address the future
health care needs of veterans. As explained in The Independent Budget:
CARES required years to complete and consumed thousands of
hours of effort and millions of dollars to study. The IBVSOs
believe it to be a comprehensive and fully justified road map
for VA's infrastructure as well as a model VA can apply
periodically to assess and adjust those priorities. Given the
strengths of the CARES process and the lessons VA learned and
has applied from it, why is the HCCF model, which to our
knowledge has not been based on any sort of model or study of
the long-term needs of veterans, the superior one? We have yet
to see evidence that it is and until we see more convincing
evidence that it will truly serve the best interests of
veterans, the IBVSOs will have a difficult time supporting it.
PVA also realizes that facility closures were a part of the CARES
report recommendations. We certainly understand the focus on reducing
excess capacity, particularly if it is clearly demonstrated that space
is significantly underutilized. However, we must emphasize that careful
thought must go into these decisions. Facility closures may have an
adverse impact on certain SCI veterans as well as those other veterans
with specialized health care needs and that rely so heavily on the VA
for care. For some PVA members who live long distances from an SCI hub
or spoke facility, particularly in rural areas, these VA hospitals
represent their only health care option. If facility closures become
necessary, VA must take action to ensure the availability of inpatient
hospital care to meet the specialized health care needs of these
affected veterans.
Mr. Chairman, PVA would again like to thank the Subcommittee for
examining this issue. We all agree that the VA of the future must be
aligned in such a fashion to best meet the demands of a changing
veterans' population while ensuring that those same veterans receive
the absolute best care possible. We look forward to working with the
Subcommittee going forward to assist the VA in accomplishing this
difficult task. I would be happy to answer any questions that you might
have.
Prepared Statement of Dennis M. Cullinan, Director,
National Legislative Service, Veterans of Foreign Wars of the United
States
MR. CHAIRMAN AND MEMBERS OF THE SUBCOMMITTEE:
On behalf of the 2.4 million men and women of the Veterans of
Foreign Wars of the U.S. (VFW) and our Auxiliaries, I would like to
thank you for the opportunity to testify today.
In April 1999, the Government Accountability Office (GAO) issued a
report on the challenges the Department of Veterans Affairs (VA) faced
in transforming the health care system. At the time, VA was in the
midst of reorganizing and modernizing after passage of the Veterans
Health Care Eligibility Reform Act in 1996.
With passage of that bill, VA developed a 5-year plan to update and
modernize the system, including the introduction of systemwide managed
care principles such as the uniform benefits package. As part of the
overall plan, VA increasingly began to rely on outpatient medical care.
Technological improvements, improved pharmaceutical options and
management initiatives all combined to lessen the need for as many
inpatient services. Additionally, the expansion of VA clinics--notably
the Community Based Outpatient Clinics (CBOCs)--brought care closer to
veterans.
These widespread changes represented a management challenge for VA,
GAO argued:
``VA's massive, aged infrastructure could be the biggest
obstacle confronting VA's ongoing transformation efforts. VA's
challenges in this arena are twofold: deciding how its assets
should be restructured, given the dramatic shifts in VA's
delivery practices, and determining how a restructuring can be
financed in a timely manner.''
GAO also testified before the House Veterans' Affairs Committee's
Subcommittee on Health in March 1999 on VA's capital asset planning
process. They concluded that, ``VA could enhance veterans' health care
benefits if it reduced the level of resources spent on underused or
inefficient buildings and used these resources, instead, to provide
health care, more efficiently in existing locations or closer to where
veterans live.'' Further, GAO found that VA was spending about 1 in 4
Medical Care dollars on asset ownership with only about one-quarter of
its then-1,200 buildings being used to provide direct health care.
Additionally, the Department had over 5 million square feet of unused
space, which GAO claims cost VA $35 million per year to operate.
From these findings, VA began the Capital Asset Realignment for
Enhanced Services (CARES) process. It was the first comprehensive,
long-range assessment of the VA health care system's infrastructure
needs since 1981.
CARES was VA's systematic, data-driven assessment of its
infrastructure that evaluated the present and future demands for health
care services, identifying changes that would help meet veterans'
needs. The CARES process necessitated the development of actuarial
models to forecast future demand for health care and the calculation of
the supply of care and the identification of future gaps in
infrastructure capacity.
The plan was a comprehensive multi-stage process.
February 2002-VA announced the results of the pilot
program of VISN-12.
August 2003-Draft National CARES Plan submitted to the
Under Secretary for Health.
February 2004-16-member independent CARES Commission
submits recommendations based upon its review of the Draft Nationals
CARES Plan.
May 2004-VA Secretary announces releases final CARES
Decision Document, but leaves several facilities up for further study.
May 2008-Final Business Plan Study released, completing
the CARES process.
Throughout the process, we were generally supportive. We
continuously emphasized that our support was contingent on the primary
emphasis being on the ``ES''--enhanced services--portion of the CARES
acronym. We wanted to see that VA planned and delivered services in a
more efficient manner that also properly balanced the needs of
veterans. And, for the most part, the process did just that.
Our main concern with the plans as they unfolded was the lack of
emphasis on mental health care and long-term care. The early stages of
the CARES process excluded many of these services for the most part
because they lacked an adequate model to project the need for these
services in the future.
The CARES Commission called for VA to develop a long-term care
strategic plan, to address the needs of veterans and all care options
available to them, including State veterans homes. As we discussed in
the Independent Budget, VA's 2007 Long-Term Care Strategic Plan did not
address these issues in a comprehensive manner; going forward, this
must be rectified.
The 2004 CARES Decision Document gave VA a road map for the future.
It called for the construction of many new medical facilities, over 100
major construction projects to realign or renovate current facilities,
and the creation of over 150 new CBOCs to expand cares into areas where
the CARES process identified gaps.
Since FY 2004, 50 major construction projects have been funded for
either design or actual construction. Eight of those projects are
complete. Six more are expected to be completed by the end of FY 2009,
and 14 others are currently under construction. So CARES has produced
results.
The strength of CARES in our view is not the one-time blueprint it
created, but in the decisionmaking framework it created. It created a
methodology for future construction decisions. VA's construction
priorities are reassessed annually, all based on the basic methodology
created to support the CARES decisions. These decisions are created
systemwide, taking into account what is best for the totality of the
health care system, and what its priorities should be.
VA's Capital Investment Panel (VACIP) is the organization within
the department responsible for these decisions. VA's capital decision
process requires the VACIP to review each project and evaluate it using
VA's decision model on a yearly basis to ensure that potential projects
are fully justified under current policy and demographic information.
These projects are assigned a priority score and ranked, with the top
projects being first inline for funding.
It is a dynamic process that depoliticizes much of the
decisionmaking process. The projects selected for funding are by and
large the projects that need the most immediate attention. Because it
is a dynamic process, some of the projects VA has moved forward with
were not part of the original CARES Decision Document, but they were
identified, prioritized and funded through the methodology developed by
CARES. We continue to have strong faith that this basic framework
serves the needs of the majority of veterans. Despite its strengths,
there are certainly some challenges.
First is that the very nature of the report required a large
infusion of funding for VA's infrastructure. While a huge number of
projects are underway, a number of these are still in the planning and
design phase. As such, they are subject to changes, but they have also
not received full funding.
This has resulted in a sizable backlog of construction projects
that are only partially funded. Were the Administration's construction
request to move forward, VA would have a backlog in funding for major
construction of nearly $4 billion. This means that to just finish up
what is already in the pipeline, it would take approximately 5 full
fiscal years of funding--based on the recent historical funding
levels--just to clear the backlog.
This Congress and this Administration must continue to provide full
funding to the Major Construction account to reduce this backlog, but
also to begin funding future construction priorities.
Another difficulty has been the slow pace of construction. Major
construction projects are huge undertakings, and in areas--such as New
Orleans or Denver--where land acquisition or site planning have
presented challenges, construction is slower than we would like. There
are, however, many cases where there have been fewer challenges, and
when the money was appropriated, construction has moved quickly.
With these twin problems of funding and speed in mind, VA has
recently been exploring ways to improve the process. Last year, they
unveiled the Health Care Center Facility (HCCF) leasing concept.
As we understand it, the HCCF was intended to be an acute care
center somewhere in size and scope between a large medical center and a
CBOC. It is intended to be a leased facility--enabling a shorter time
for it to be up and running--that provides outpatient care. Inpatient
care would be provided on a contracted basis, typically in partnership
with a local health care facility.
We expressed our concerns with the HCCF concept in the Independent
Budget (IB). Primarily, we are concerned that this concept--which
heavily relies on widespread contracting--would be done in lieu of an
investment of major construction.
Acknowledging that with the changes taking place in health care, VA
needs to look very carefully before building new facilities. Cost plus
occupancy must justify full-blown medical centers. But leasing is the
right thing to do only if the agreements make sense.
VA needs to do a better job explaining to veterans and the Congress
what their plans are for every location based on facts. The ruinous
miscommunication that plagued the Denver construction project amply
demonstrates this point.
While promising, the HCCF model presents many questions that need
answers before we can fully support it. Chief among these is why, given
the strengths of the CARES process and the lessons VA has learned and
applied from it, is the HCCF model, which to our knowledge has not been
based on any sort of model or study of the long-term needs of veterans,
the superior one?
We also have major concerns with the widespread contracting that
would be mandated by this type of proposal. The lessons from Grand
Island, NE--where the local hospital later canceled the contract,
leaving veterans without local inpatient care--or from Omaha--where
some veterans seeking specialized services are flown to Minneapolis--
show the potential downfall of large-scale contracting.
Leasing clinical space is certainly a viable option. It does
provide for quicker expansion into areas with gaps in care, and it does
provide the Department with flexibility in the future.
But when it is combined with the contracting issue, and presented
without information and supporting documentation that is as rigorous or
comprehensive as CARES was, it will be difficult for the VFW and the
veteran's community to support it.
We have seen the importance of leasing facilities with certain
CBOCs and Vet Centers, especially when it comes to expanding care to
veterans in rural areas. CARES did an excellent job of identifying
locations with gaps in care, and VA has continued to refine its
statistics, especially with the improved data it is getting from the
Department of Defense about OEF/OIF veterans.
Providing care to these rural veterans is the latest challenge for
the system, and the expansion of CBOCs and other initiatives can only
help. We do believe, however, that much of what will improve access for
these veterans will lie outside the construction process. VA must
better use its fee-basis care program, and the recent initiatives
passed by Congress--such as the mobile health care vans or the rotating
satellite clinics in some areas--are going to fix some of the demand
problems these veterans face.
We can always certainly do more, but thanks to the CARES blueprint,
VA has greatly improved the ability of veterans around the country to
access the care they earned by virtue of their service to this country.
And with the annual adjustments and reassessments that account for
changes within the veterans' population, we can assure that veterans
are receiving the best possible care long into the future.
The VFW thanks you and the Subcommittee for looking at this most
important issue.
Prepared Statement of Richard F. Weidman, Executive Director for
Policy and Government Affairs, Vietnam Veterans of America
Good morning, Mr. Chairman, Ranking Member Brown and distinguished
Members of this Subcommittee, on behalf of Vietnam Veterans of America
(VVA) National President John Rowan and all our officers we thank you
for the opportunity for VVA to present our views on Assessing CARES and
the Future of VA's Health Infrastructure. I ask that you enter our full
statement in the record, and I will briefly summarize the most
important points of our statement.
VVA has long advocated for proper stewardship of our Nation's
veterans health care system. By this we mean stewardship in the sense
that one is conscious of leaving the physical plant as well as the
quality and the quantity of medical services delivered therein better
than one found it. Our first National President was on a dirty, rat
infested ward for Spinal Cord Injured veterans at the old Bronx VA
medical center that was the cover story of an issue of LIFE magazine in
1970. As a result of the publicity and furor generated by that article,
the momentum was created that led to the construction of a brand new
modern and much larger VA facility in Bronx, New York, and led to the
antiquated one being torn down.
The concept of the Capital Asset Realignment for Enhanced Service
(CARES) is ostensibly one of stewardship, and therefore VVA endorses
the concept. However, VVA continues to be very concerned about the
actual process that is currently in place. Many of the most gross
mistakes and errors created by the process created by VHA and their
outside contractor were corrected by the good work and intrepid efforts
of the Honorable Everett Alvarez and his distinguished colleagues who
served on the CARES Commission some 5 years ago.
Other particularly poor recommendations of the initial report from
VHA were corrected by the Secretary of Veterans Affairs when he
accepted the report of the CARES Commission. However the basic formula
and process remain basically for the future, and therein lays the core
of the problem. The formula developed by the Milliman-USA people is a
civilian formula designed for basically healthy middle class people
that can afford to purchase access to an HMO or PPO. It does not take
into account the wounds or diseases that are attendant to military
service, particularly for those deployed overseas and/or in a war zone.
Despite common sense that would mandate it, and despite earnest
entreaties from VVA and others, the VA Veterans Health Administration
(VHA) still does not take a military history from each veteran, make it
part of the veteran's medical record on the Central Patient Records
System (CPRS) in the VISTA system at VHA, and use it as a significant
part of the basis for the diagnosis procedure or in the process of
crafting a successful treatment modality (or modalities). Because of
this, the VA constantly underestimates the chronic diseases and long
term health care problems that veterans are likely to experience. It is
not that VA does not know what the wounds, maladies, injuries, and
conditions are that veterans, depending on when and where they served,
are more likely to experience than their civilian cohort. As Attachment
I please find enclosed the title page to www.va.gov/vhi that leads one
to the Veterans Health Initiative (VHI), which is a set of curricula in
many of the conditions for which veterans face increased risks. So VA
knows what most of these increased risks are, and even distributes the
``pocket card'' to new medical residents and interns at VA medical
centers and other VHA facilities, as well as providing it to others
(see Appendix II or go to http://va.gov/oaa/pocketcard/), as well as
having had it in the M1A1 Medical Procedures Manual since 1982.
What bearing does all of this have on the CARES formula? Well, the
Milliman formula, which as noted above is basically a civilian formula,
does not take any of these special conditions that veterans are subject
to into account. Further, the Milliman formula is based on one to three
``presentations'' per individual who comes to the medical facility for
service, whereas VA medical centers average between five and nine
``presentations'' per individual. What this means is that each unique
individual consumes more resources per person than the Milliman formula
allows for in its computations. Therefore, the formula, which has come
to affect all of resource planning at the VHA, will perennially leave
the VHA short of the needed resources to deliver timely, quality
medical care to each veteran eligible and seeking such services. The
same holds true when it comes to estimating what will be needed in the
way of physical facilities to deliver health care in the future.
CARES was funded on the premise that there was a great deal of
unutilized space at VA facilities across the Nation, and that because
the population of veterans eligible for services who were likely to
seek such services, that the census of patients would be in precipitous
decline from 2000 to 2020 (later changed to 2002 to 2022). That has
proven to be an erroneous assumption. Not only have the ranks of
veterans risen because of the wars in Iraq, Afghanistan, and elsewhere,
but even the size of our standing force of active duty military has
been increased for the foreseeable future.
Using all of the supposedly great tools of projection, VHA has
dramatically underestimated the number of OIF/OEF veterans who would
seek medical services from VA in each of the last 5 years. Further,
even before the new Administration and the Congress began easing the
restrictions on so-called category 8 veterans, the VA underestimated
the number of veterans of earlier generations who would seek and
receive medical services. Some of that increase comes from previously
service connected disabled veterans who lost eligibility for other
private sector medical options as a result of job loss or retirement,
or their employer could no longer afford to have medical insurance for
their employees. For others, they are ``new'' older veterans who after
years of delay were finally awarded service connected disabled status,
and therefore access to medical care. All of these have led to an
increase not only in the gross number of veterans seeking help from
VHA, but at most VHA facilities the number of veterans seeking services
has remained constant or risen in the past 7 years. Even at those
facilities where the number seeking services has remained essentially
constant (mostly in the northern climates of the Nation), the number of
medical needs has risen because those who could afford to move to a
warmer climate as they got older and/or retired did so. Those that
stayed were/are older, poorer, and sicker, and therefore need more
resources to take care of per person than those who had the ability to
move.
It is time to re-examine all of the original assumptions of the
CARES process now that it is clear that the number of veterans seeking
services is not generally declining, and that the needed services per
individual will likely continue to rise, at least for another decade or
so, as the average age of the Vietnam veterans rises (currently the
mean average age of Vietnam veterans, who constitute 60% of VA
patients, is 63 years old, while the median age of Vietnam veterans is
almost 61 years old). What the growth of the younger cohorts, and the
increase in use by the Vietnam cohort means is that the notion of many
empty buildings across America that are not needed just is not the
case. In most cases, that space is needed and more. Further, the notion
advanced by the now former Under Secretary of Health that ``we cannot
afford any more new hospitals for veterans'' is a notion that was out
of step with both the clear and apparent need, and was clearly not in
keeping with fulfilling the obligation of the American people to ``care
for he (and she) who hath borne the battle.''
The 2007 GAO Report (GAO-07-408) from March 2008 criticized VA for
not following through on making the goals, objectives, and timetables
for the CARES implementation plan clear to all. It also sharply
criticized VA for CARES not being a transparent process at every step.
GAO noted that VA did not build meeting the specific goals of CARES
into the set of metrics by which managers are rated and scored on their
performance ratings within the VHA, which meant that it was unclear who
is supposed to be doing what to get on track with upgrading the
physical structures of VHA. VVA also criticized VA for a lack of
clarity in just who was in charge of implementation, and the role of
the many players in the process.
VVA would also note that until the 110th Congress, there was
nowhere near the minimum of $1 billion per year upon which the CARES
plan was predicated which was actually provided to VA in the
appropriation. This means that the schedule is seriously behind because
it was not fully funded in the early years of implementation.
So, where are we today? VVA recommends the following steps to
ensure that the physical plant needed for the effective and efficient
provision of quality medical services to veterans is in place for those
currently in need of these services, and for the future:
1. VVA strongly believes that the basic CARES formula must be
improved by making it a ``veterans' health care formula'' that takes
into account the actual situation of veterans, and likely rate of use
of resources per person, so that it provides for the request for
resources it will take to properly serve all of the needs, of the
veterans population that seeks medical services at VHA, particularly
the conditions that are a direct or indirect result of military
service.
2. VVA believes that the entire process, like much of the rest of
activities and planning at VA, needs to be much more transparent, with
respect to involvement at every level of ALL of the stakeholders. The
previous Administration, and particularly those who have occupied the
top leadership positions of VHA in the past 7 years, showed veritable
contempt for the Congress, for veterans service organizations, for the
VA labor unions and their members, and for individual veterans by the
secretive and patronizing manner in which business was all too often
conducted. This must be dramatically changed, and the process and the
way of doing business transformed.
3. VVA urges that the major construction budget be set at a level
of at least $1.5 billion to $2 billion per year for the next few years
to begin to make up for all that did not happen during the previous
decades, and particularly in the first few years of the CARES process.
As imperfect as the formula and the process are, at least we know that
what has been recommended is the bare minimum that is needed to
properly care for veterans. Even while work goes on to improve both the
formula and the overall process, we can speed up the pace of
implementation. Because of the financial crisis, we can frankly get
buildings built today for much less than will be the case in a few
years with worldwide liquidity.
4. VVA recommends that the Secretary and the Deputy Secretary
review the lines of authority and accountability for implementing CARES
is clear to all parties, and the role of each is clear, from the Office
of Policy & Planning in the central VA office to the VISN Directors and
VAMC Directors.
While there are no doubt other useful steps that can and should be
taken to improve the CARES process, these are in the view of VVA the
four most important steps. Mr. Chairman, thank you for the opportunity
to provide our brief remarks. I will be happy to answer any questions.
Prepared Statement of Joy J. Ilem,
Assistant National Legislative Director, Disabled American Veterans
Mr. Chairman and Members of the Subcommittee:
Thank you for inviting the Disabled American Veterans (DAV) to
testify at this oversight hearing of the Subcommittee on Health. We
appreciate the opportunity to offer our views on progress by the
Department of Veterans Affairs (VA) in delivering on the
recommendations outlined in the 2004 Capital Asset Realignment for
Enhanced Services (CARES) report, and to discuss the future of VA's
health care infrastructure.
As we near the end of the first decade of the 21st century, we find
ourselves at a critical juncture with respect to how VA health care
will be delivered and what the VA of the future will be like in terms
of its health care facility infrastructure. Although admittedly this
vision is yet to gain clarity, one fact is certain--our Nation's sick
and disabled veterans deserve and have earned a stable, accessible VA
health care system that is dedicated to their unique needs and can
provide high-quality, timely care where and when they need it.
CARES BEGINS
Mr. Chairman, based on preliminary work by the professional staff
of this Subcommittee, VA initiated CARES in 1999 with a pilot program
in Veterans Integrated Service Network (VISN) 12, through the auspices
of a contract with the firm of Booz Allen Hamilton. In 2001, that
contract was canceled and VA integrated the CARES process within its
own staff and other resources. The process took years to complete and
required tens of thousands of staff-hours of effort and millions of
dollars in studies. At its conclusion, with issuance of the so-called
``Draft National CARES Plan,'' the VA Secretary chartered and appointed
a CARES Commission to independently evaluate and consider its outcomes
and recommendations. These processes were largely conducted and
reported in public.
As a general principle, the Independent Budget Veterans Service
Organizations (IBVSOs), DAV, AMVETS, Paralyzed Veterans of America, and
Veterans of Foreign Wars of the United States, concluded that CARES was
a comprehensive and fully justified road map for VA's infrastructure
needs, as well as a model that VA could apply periodically to assess
and adjust those priorities. However, once the Draft National CARES
Plan was released in 2004, an immediate backlash developed to the
proposed recommendations affecting the operating missions of a number
of VA facilities. Many veterans, fearful that they would lose VA health
care services, and selected Members of Congress, opposed the plans for
changes in their States--and in their VA facilities, irrespective of
the validity of the findings or the value of the plan as a whole. Local
political pressure became intense, and in many cases the proposed CARES
recommendations were scuttled. In one respect, it became clear that
veterans and their Members of Congress were passionate and committed in
keeping targeted VA facilities intact. Unfortunately, this passionate
defense of the status quo stymied the CARES implementation phase, and
caused VA to become much more reserved about sharing information about
any strategic infrastructure planning.
CARES STALLED
Upon completion of the Draft National CARES Plan in 2004, then-VA
Secretary Anthony Principi testified before this Subcommittee. His
testimony noted that CARES ``reflects a need for additional investments
of approximately $1 billion per year for the next 5 years to modernize
VA's medical infrastructure and enhance veterans' access to care.'' VA
reports that through fiscal year (FY) 2009, Congress actually has
appropriated $4.9 billion for construction projects since FY 2004.
On July 18, 2008, then-VA Secretary James Peake wrote to two
Members of Congress that the planned Denver, Colorado replacement VA
medical center was ``. . . not affordable . . .'' as a traditional
government-owned, VA-operated facility of the size, scope and price
that had been designed. That same day, while not declaring CARES
officially ``dead,'' Secretary Peake spoke before a large audience at
the National Press Club and indicated, in answer to a question, that VA
would be looking at factors beyond CARES to determine its future
capital infrastructure planning needs.
For nearly a decade, the IBVSOs have argued that the VA must be
protected from deterioration of its health infrastructure, and the
consequent decline in VA's capital asset value. Year after year, we
have urged Congress and the Administration to ensure that appropriated
funding is adequate in VA's capital budget so that VA can properly
invest in its physical assets, protect their value, and ensure health
care in safe and functional facilities long into the future. Likewise,
we have stressed that VA's facilities have an average age of more than
55 years; therefore, it is essential that funding be routinely
dedicated to renovate, repair, and replace VA's aging structures,
capital, and plant equipment systems as needed.
CAPITAL FUNDS DEFICIT WORSENED UNDER CARES
Mr. Chairman, unfortunately, the past decade of deferred and
underfunded construction budgets has meant that VA has not adequately
recapitalized its facilities, now leaving the health care system with a
large backlog of major construction projects totaling between $6.5
billion to $10 billion, with an accompanying urgency to deal with this
growing dilemma.
One of the reasons VA's construction backlog is so large and
growing today is because both VA and Congress, by agreement with the
two prior Administrations, allocated little to no capital construction
funding during the pendency of the CARES process, over a 6-year period.
Agreeing with VA, the Appropriations Committees in both chambers
provided few resources during the initial review phase, preferring to
wait for CARES results, a decision the IBVSOs repeatedly opposed. We
argued that a de facto moratorium on construction was unnecessary
because a number of these projects obviously warranted funding and
would almost certainly be validated through the CARES review process.
The House agreed with our views as evidenced by its passage of H.R.
811, the ``Veterans Hospital Emergency Repair Act.'' That bill passed
unanimously on March 27, 2001, about 2 years into the CARES process.
Let me quote, in part, what the bill's sponsor, then Chairman
Christopher H. Smith, had to say in introducing H.R. 811 over 8 years
ago:
Mr. Speaker, for the past several years, we have noted that
the President's annual budget for VA health care has requested
little or no funding for major medical facility construction
projects for America's veterans. As we indicated last year in
our report to the Committee on the Budget on the
Administration's budget request for fiscal year 2001, VA has
engaged in an effort through market-based research by
independent organizations to determine whether present VA
facility infrastructures are meeting needs in the most
appropriate manner, and whether services to veterans can be
enhanced with alternative approaches. This process, called
``Capital Assets Realignment for Enhanced Services,'' or
``CARES,'' has commenced within the Department of Veterans
Affairs, but will require several years before bearing fruit.
In the interim, Mr. Speaker, some VA hospitals need additional
maintenance, repair and improvements to address immediate
dangers and hazards, to promote safety and to sustain a
reasonable standard of care for the Nation's veterans. Recent
reports by outside consultants and VA have revealed that dozens
of VA health care buildings are still seriously at risk from
seismic damage. The buildings at American Lake [Washington]
damaged in yesterday's earthquake were among those identified
as being at the highest levels of risk.
Also, Mr. Speaker, a report by VA identified $57 million in
improvements were needed to address women's health care;
another report, by the Price Waterhouse firm, concluded that VA
should be spending from 2 percent to 4 percent of its ``plant
replacement value'' (PRV) on upkeep and replacement of its
health care facilities. This PRV value in VA is about $35
billion; thus, using the Price Waterhouse index on maintenance
and replacement, VA should be spending from $700 million to
$1.4 billion each year. In fact, in fiscal year 2001, VA will
spend only $170.2 million for these purposes.
While Congress authorized a number of major medical
construction projects in the past 3 fiscal years, these have
received no funding through the appropriations process. I
understand that some of the more recent deferrals of major VA
construction funding were intended to permit the CARES process
to proceed in an orderly fashion, avoiding unnecessary spending
on VA hospital facilities that might, in the future, not be
needed for veterans. I agree with this general policy,
especially for those larger hospital projects, ones that
ordinarily would be considered under our regular annual
construction authorization authority. We need to resist
wasteful spending, especially when overall funds are so
precious. But I believe that I have a better plan.
To our regret, the Senate never considered the proposed bill,
Congress did not appropriate supportive funding, and the construction
and maintenance backlog continued to grow unabated for the next several
years. Incidentally, the needed infrastructure improvements for women
veterans (for privacy, restroom accommodations, etc.) mentioned by
Representative Smith were largely never made. The VA projects that the
number of women veterans turning to VA for care will likely double in
the next 2-4 years; therefore, it is essential that these
infrastructure needs are addressed now.
Another area of concern is VA research capital infrastructure. Over
the past decade, minimal funding has been appropriated or allocated to
maintain, upgrade or replace aging VA research facilities. Many VA
facilities have run out of adequate research space. Plumbing,
ventilation, electrical equipment and other required maintenance needs
have been deferred. In some urgent cases, VA medical center Directors
have been forced to divert medical care appropriations to research
projects to avoid dangerous or hazardous situations.
The 2003 Draft National CARES Plan (DNCP) included $142 million for
renovation of existing research space and to cover build-out costs for
leased research facilities. However, these capital improvement costs
were omitted from the VA Secretary's final report on CARES, the so-
called ``CARES Decision Memorandum.'' According to Friends of VA
Medical Care and Health Research (FOVA), over the past decade, only $50
million has been spent on VA research construction or renovation in
VA's nationwide research system. Additionally, FOVA noted in its fiscal
year 2010 budget proposal, endorsed by DAV, that VA was congressionally
directed to conduct a comprehensive review of its research facilities
and report to Congress on the deficiencies found, with recommended
corrections. During FY 2008, the VA Office of Research and Development
initiated a 3-year examination of all VA research infrastructure to
assess physical condition, capacity for current research, as well as
program growth and sustainability of the space to conduct research. We
urge the Subcommittee to consider this report when completed, and for
Congress to address VA's research facilities improvement needs as part
of a separate VA research infrastructure appropriation. VA's Medical
and Prosthetic Research program is a national asset to VA and
veterans--it helps to ensure the highest standard of care for veterans
enrolled in VA health care, and elevates health care practices and
standards in all of American health care. That program cannot continue
its record of achievement without adequate maintenance of the capital
infrastructure in which it functions.
CARES PROJECTION MODEL
One of the strengths of the CARES process was that it was not just
a one-time snapshot of needs. As part of the process, VA developed a
health care projection model to estimate current and future demand for
health care services, and to assess the ability of its infrastructure
to meet this demand. VA uses this projection model throughout its
capital planning process, basing all projected capital projects upon
the results of the demand model.
VA's model, was also relied on for VA health care budget, policy
and planning decisions, produces 20-year forecasts in demand for VA
health services. It is a complex and sophisticated model that adjusts
for numerous factors, including demographic shifts, morbidity and
mortality, changing needs for health care based on aging of the veteran
population, projections to account for health care innovations, and
many other relevant factors.
In a November 2007 hearing before this Subcommittee, VA's testimony
summed up the process:
Once a potential project is identified, it is reviewed and
scored based on criteria VA considers essential to providing
high-quality services in an efficient manner. The criteria VA
utilizes in evaluating projects include service delivery
enhancements, the safeguarding of assets, special emphasis
programs, capital asset priorities, departmental alignment, and
financial priorities. VA considers these new funding
requirements along with existing CARES decisions in determining
the projects and funding levels to request as part of the VA
budget submission. Appropriate projects are evaluated for joint
needs with the Department of Defense and sharing opportunities.
VA uses these evaluation criteria to prioritize its projects each
year, releasing these results in its annual 5-year capital plan. The
most recent one, covering fiscal years 2009-2013, is part of the
Congressional budget submission in ``Volume III: Construction
Activities.'' This plan is central to VA's funding requests and clearly
lists the Department's highest construction priorities for the current
year, as well as for the immediate future. The Partnership for VA
Health Care Budget Reform, in testifying before your full Committee on
April 29, 2009, provided detailed information and our opinion about
VA's projection model in support of our proposed reforms in VA health
care funding. We refer the Subcommittee to that testimony for our
comments on the model.
VA MOVING IN NEW DIRECTION
Mr. Chairman, over the past several years, VA began to discuss with
the veterans service organization community, its desire to address its
health infrastructure needs in a new way. VA acknowledged its
challenges with aging infrastructure; changing health care delivery
needs, including reduced demand for inpatient beds and increasing
demands for outpatient care and medical specialty services; limited
funding available for construction of new facilities; frequent delays
in constructing and renovating space needed to increase access, and
particularly the timeliness of construction projects. VA has noted, and
we concur, that a decade or more is required from the time VA initially
proposes a major medical facility construction project, until the doors
actually open for veterans to receive care in that facility. VA
indicated to us a necessity to consider alternative means to address
the growing capital infrastructure backlog and the significant
challenge of funding it.
Given these significant challenges, VA has broached the idea of a
new model for health care delivery, the Health Care Center Facility
(HCCF) leasing program. Under the HCCF proposal, in lieu of the
traditional approach to major medical facility construction, VA would
obtain by long-term lease, a number of large outpatient clinics built
to VA specifications. These large clinics would provide a broad range
of outpatient services, including primary and specialty care as well as
outpatient mental health services and ambulatory surgery.
VA noted, that in addition to its new HCCF facilities, it would
maintain its VA medical centers (VAMCs), larger independent outpatient
clinics, community-based outpatient clinics (CBOCs) and rural outreach
clinics. VA has argued that the HCCF model would allow VA to quickly
establish new facilities that will provide 95 percent of the care and
services veterans will need in their catchment areas, specifically
primary care, and a variety of specialty services, mental health,
diagnostic testing and same-day ambulatory surgery. According to VA,
veterans' inpatient hospital service needed by these HCCFs would be
provided through additional leases, VA staffed units, or other
contracts or fee-for-service options with academic affiliates or in
available community hospitals.
We concur with VA that the HCCF model seems to offer a number of
benefits in addressing its capital infrastructure problems including
more modern facilities that meet current life-safety codes; better
geographic placements; increased patient safety; reductions in
veterans' travel costs and increased convenience; flexibility to
respond to changes in patient loads and technologies; overall savings
in operating costs and in facility maintenance and reduced overhead in
maintaining outdated medical centers.
CHALLENGES TO HCCF MODEL
Nevertheless, Mr. Chairman, while it offers some obvious
advantages, the HCCF model also portends obvious challenges. Outside
the CBOC environment, contract management in complex leased health care
facilities is an untested practice in VA. This Subcommittee has spent
years overseeing efforts to improve VA's contracting performance across
a range of activities, including obtaining contract health care for
eligible veterans. Also, we are deeply concerned about the overall
impact of this new model on the future of VA's system of care,
including the potential unintended consequences on continuity of high-
quality care, delivery of comprehensive services, VA's electronic
health record (EHR), its recognized biomedical research and development
programs, and particularly the impact on VA's renowned graduate medical
education and health professions training programs, in conjunction with
longstanding affiliations with nearly every health professions
university in the Nation. Additionally, we question VA's ability to
provide alternatives for maintaining its existing 130 nursing home care
units, homeless programs, domiciliaries, compensated work therapy
programs, hospice, adult day health care units, the Health Services
Research and Development Program, and a number of other highly
specialized services including 24 spinal cord injury centers, 10 blind
rehabilitation centers, a variety of unique ``centers of excellence''
(in geriatrics, gerontology, mental illness, Parkinson's, and multiple
sclerosis), and critical care programs for veterans with serious and
chronic mental illnesses. We question if VA has seriously considered
the probable impact on these programs in developing the HCCF concept.
In general, the HCCF proposal seems to be a positive development,
with good potential. Leasing has the advantage of avoiding long and
costly in-house construction delays and can be adaptable, especially
when compared to costs for renovating existing VA major medical
facilities. Leasing options have been particularly valuable for VA as
evidenced by the success of the leased space arrangements for many VA
community-based outpatient clinics and Vet Centers. However, VA has
virtually no experience managing as a tenant in a building owned by
others, for the delivery of complex, subspecialty VA health care
services.
INPATIENT SERVICES: A MAJOR CONCERN
The IBVSOs are also concerned with VA's plan for obtaining
inpatient services under the HCCF model. VA says it will contract for
these essential inpatient services with VA affiliates or community
hospitals. First and foremost, we fear this approach could negatively
impact safety, quality and continuity of care, and permanently
privatize many services we believe VA should continue to provide. We
have testified on this topic numerous times, and the IBVSOs have
expressed objections to privatization and widespread contracting for
care in the ``Contract Care Coordination'' and ``Community-Based
Outpatient Clinics'' sections of the Fiscal Year 2010 Independent
Budget. We call the Subcommittee's attention to those specific
concerns.
In November 2008, VA responded to a Senate request for more
information on VA's plans for the newly proposed HCCF leasing
initiative. A copy of VA's response is attached to this testimony and I
ask that it be made a part of the record of this hearing, Mr. Chairman.
To summarize that response, VA advised it originally identified 22
sites that could potentially be considered appropriate for adoption of
the HCCF concept. Following additional analysis, that number was
reduced to 8 potential sites for review, including Butler,
Pennsylvania; Lexington, Kentucky; Monterey and Loma Linda, California;
Montgomery, Alabama; and Charlotte, Fayetteville and Winston-Salem,
North Carolina.
VA also addressed a number of other specific questions in the
November 2008 letter including whether studies had been carried out to
determine the effectiveness of the current approach; the full extent of
the current construction backlog of projects and its projected cost
over the next 5 years to complete; the extent to which national
veterans organizations were involved in the development of the HCCF
proposal; the engagement of community health providers related to
capacity to meet veterans' needs; the ramifications on the delivery of
long-term care and inpatient specialty care; and whether VA would be
able to ensure that needed inpatient capacity will remain available.
I will comment on some of the key responses from VA related to
these noted questions. Initially, it appears VA has a reasonable
foundation for assessing capital needs and has been forthright with the
estimated total costs for ongoing major medical facility projects. For
this year, VA estimated $2.3 billion in funding needs for existing and
ongoing projects. The Department estimated that the total funding
requirement for major medical facility projects over the next 5 years
would be in excess of $6.5 billion. Additionally, if the new HCCF
initiative is fully implemented, VA indicated it would need
approximately $385 million more to execute seven of the eight new HCCF
leases.
We agree with VA's assertion that it needs a balanced program of
capital assets, both owned and leased buildings, to ensure demands are
met under the current and projected workload. Likewise, we agree with
VA that the HCCF concept could provide modern health care facilities
that would not otherwise be available due to the predictable
constraints of VA's major construction program.
VA indicated in its letter that the eight sites proposed for the
HCCF initiative were chosen to ensure there would be little impact on
VA specialty inpatient services or on delivery of long-term care.
However, VA made a statement with respect to the HCCF model for the
proposed sites that is somewhat confounding (VA's response to question
5), as follows: ``By focusing the outpatient needs through HCCF's,
major construction funding could then shift to the remaining capital
needs.'' What is not clear to us is the extent to which VA plans to
deploy the HCCF model. In areas where existing CBOCs need to be
replaced or expanded with additional services due to the need to
increase capacity, the HCCF model would seem appropriate and beneficial
to veterans. On the other hand, if VA plans to replace the majority or
even a large fraction of all VAMCs with HCCFs, such a radical shift
would pose a number of concerns for DAV.
Mr. Chairman, before the HCCF concept is permitted to go forward on
a larger scale, and with a major private sector component as described
by VA, we believe VA must address and resolve a number of challenges.
Among these questions are:
Facility governance, especially with respect to the large
numbers of non-VA employees who would be treating veterans;
VA directives and rule changes that govern health care
delivery and ensure safety and uniformity of the quality of care;
VA space planning criteria and design guides' use in non-
VA facilities;
VA's critical research activities, most of which improve
the lives not only of veterans but of all Americans;
VA's electronic health record, which many observers,
including the President, have rightly lauded as the EHR standard that
other health care systems should aim to achieve; and
Continuity of care within the mix of public/private
facilities, as well as for those VA-enrolled veterans who relocate to
other areas from the HCCF environment.
Fully addressing these and related questions are important, but we
see this challenge as only a small part of the overall picture related
to VA health infrastructure needs in the 21st century. The emerging
HCCF plan does not address the fate of VA's 153 medical centers located
throughout the Nation that are on average 55 years of age or older. It
does not address long-term care needs of the aging veteran population,
treatment of the chronically and seriously mentally ill, the unresolved
rural health access issues, or the lingering questions on improving
VA's research infrastructure.
HISTORY AS A LESSON FOR THE FUTURE
Today's VA largely was built during and immediately following World
War II, to become an exalted place of care for over 500,000 injured war
veterans. Some of those wounded remained hospitalized in VA for the
remainder of their lives. VA's spinal cord injury, blind rehabilitation
and prosthetics and sensory aids programs got their genesis or major
expansions from World War II veterans' needs. In 1946, Congress
established the Department of Medicine and Surgery (DM&S), now the
Veterans Health Administration, and gave many independent powers that
other Federal agencies lacked, in order to care for those wounded
heroes. DM&S Memorandum No. 2 formed the VA-medical school affiliation
relationships, to guarantee the young and energetic physicians-in-
training of that age would turn their full attention to wounded and ill
veterans. In conjunction with new affiliations, VA made a collective
decision to locate its new post-war VA hospitals nearby or alongside
existing medical schools' academic health centers for the potential
symbiotic effect and to help ensure a high-quality physician workforce
remained available to sick and disabled veterans. VA's biomedical
research and development programs and its remarkable academic training
programs we see in practice today emerged out of these seminal
decisions and have become instrumental in both aiding VA with stronger
academic credentials, advancing evidence-based treatments, and
promoting a higher standard of care for wounded and sick veterans. Even
with the advent of primary care and VA's other transformations during
the past decade, this cooperative VA-academic system of care is still
largely intact more than 60 years after World War II.
Mr. Chairman, as this Subcommittee and Congress at large consider
the future of VA's infrastructure, and VA's future overall, it is good
to remember our history, and to learn from it. Today, the Nation
confronts two wars that, when concluded, will have likely produced over
2 million new veterans. While early in the process, we know from VA
that already more than 400,000 of them have contacted VA for health
care, for conditions ranging from post-deployment mental health
conditions to minor musculoskeletal problems to severe brain injury
with multiple amputations. No less than earlier generations and
probably more so, these veterans will need VA to be sustained for them.
The question that confronts the Subcommittee today is--what that VA
system is going to be, what it will offer, and how it will be managed
and sustained. We in the veterans service organization community cannot
plan the future VA, and we would not expect your Subcommittee to do so
independently. Given the President's pledge to create the VA of the
21st century, and Chairman Filner's commitment to aid VA in that
endeavor; however, we do expect that VA should be mandated to establish
its plan in a transparent way, vet that plan through our community and
other interested parties, and provide its plan to Congress. We hope
that all our communities (both inside and outside VA) share our
concerns and want to help VA mold a strategic capital plan that all can
accept and help collectively to accomplish. However, until this process
materializes, we fear that VA's capital programs and the significant
effects on the system as a whole and on veterans individually, will go
unchanged, ultimately risking disaster for VA and for America's sick
and disabled veterans.
AVOIDING THE OBVIOUS
As we grapple with the issue of health care and insurance reform in
America, we must make every effort to protect the VA system for future
generations of sick and disabled veterans. A well thought-out capital
and strategic plan is urgently needed, and the tough decisions must be
made, not avoided as in the response to the seemingly aborted CARES
process. We are pleased the current Administration has committed to
building the VA of the 21st century. However, we are not sure what this
may mean, nor do we have the value of a VA comprehensive infrastructure
plan. Regardless of the direction VA takes, we must insist there is
consideration of all the elements we have described throughout our
testimony. Critical elements in VA make up what are considered by all
accounts the ``best care anywhere'' in the United States. We want to
ensure VA's infrastructure plan maintains the integrity of the VA
health care system, and all the benefits VA brings to its enrolled
population. We want to ensure care is not fragmented and that high-
quality, safe health care remains the bulwark of VA's programs.
CARES: AN UNFULFILLED VISION
Mr. Chairman, hitting its apex in 2004, we at DAV believe CARES
provided a solid foundation for, and a valuable assessment of, what VA
had in its health care infrastructure portfolio and where VA needed to
go, but we ask today, what substantive action has been taken since the
release of the CARES report to overhaul the system to make way for the
21st century? Currently VA is planning construction of five major VA
medical centers, in Orlando, Florida; Denver, Colorado; Las Vegas,
Nevada; Louisville, Kentucky; and New Orleans, Louisiana. None of the
decisions to build these facilities was affected by the CARES process
in any way but the most marginal sense. However, the decisions were
unquestionably affected by the political process. While VA is
addressing these political demands, it is still ignoring similar
deficits at facilities such as in Togus, Maine; Sheridan, Wyoming;
Wichita, Kansas; East Orange, New Jersey; Hines, Illinois; Mountain
Home, Tennessee; Battle Creek, Michigan; and more than 100 other older
VA medical centers, some of which are in, or are reaching, dire need
for infusion of major infrastructure funding.
VA: AT RISK
At this juncture, we believe VA soon may be in a very precarious
situation. Operations Iraqi and Enduring Freedom continue. Each day we
see growth in future health care, rehabilitation and post-deployment
mental health needs in our newest generation of war veterans, and
record demand for VA care by previous generations of disabled veterans.
As a Nation, we must be good stewards of taxpayer dollars, yet we must
also fulfill the commitment of the Nation to care for those who have
suffered illness or injury as a result of military service and combat
deployment. Concurrently, the American economy is unstable, Social
Security, Medicare and Medicaid are seen by many to be unsustainable if
not changed, and the new Administration and Congress are trying to
formulate a plan to ensure access to basic health care services for
every U.S. resident, and simultaneously reform the private insurance
system. Changes coming from those trends, and that work, will
undoubtedly affect the viability of VA in the future, but it is
impossible to know the depth of that impact or its nature.
Unfortunately, from what we do know, VA is largely uninvolved in the
health care reform debate, and therefore, VA may be negatively impacted
by those larger reforms. In our opinion, the VA, as a Cabinet agency,
cannot be permitted to sit on the sideline of health care reform, but
must be proactive and fully engaged in the debate.
ADVOCATES WANT A 21ST CENTURY VA
As advocates for veterans, we do not accept VA's contention that
replacing outdated VA facilities is ``. . . not affordable.'' VA's
infrastructure needs have been deferred, neglected and delayed for far
too long, to the advantage of other consumers of Federal dollars;
therefore, without question facility replacements and updating are
going to be costly, and both Congress and the Administration are
confronted with that reality. The FY 2008 VA Asset Management Plan
provides the most recent estimate of VA's needs. Using the guidance of
the Federal Government's Federal Real Property Council, the value of
VA's infrastructure is just over $85 billion. Accordingly, using
industry standards as a yardstick, VA's capital budget should be
between $4.25 billion and $6.8 billion annually in order to maintain
its infrastructure at that value. VA's capital budget request for FY
2009--which includes major and minor construction, maintenance, leases,
and equipment--was $3.6 billion.
The IBVSOs greatly appreciate that Congress provided funding above
that level this year by an increase over the Administration's request
of $750 million in Major and Minor Construction alone. That higher
amount brought the total capital budget for FY 2009 inline with
industry standards. We strongly urge that these targets continue to be
met and we would hope that future VA requests use standard guidelines
as a starting point without requiring Congress to add additional
funding. We also are mindful that Congress included nearly $1 billion
in the recent economic stimulus package that will fund VA
infrastructure improvements and represents a significant re-payment to
VA of capital funds it should have received years ago while CARES was
underway.
DESIGN THE FUTURE
Congress and the Administration must work together to secure VA's
future to design a VA of the 21st century. It will take the joint
cooperation of Congress and the Administration to support this reform,
while setting aside resistance to change, even dramatic change, when
change is demanded and supported by valid data. Accordingly, we urge
the Administration and the Congress to live up to the President's words
by making a steady, stable investment in VA's capital infrastructure to
bring the system up to match the 21st century needs of veterans.
COMMUNICATIONS WILL BE KEY TO SUCCESS
Finally, one of our community's pent-up frustrations with respect
to VA's infrastructure is lack of information and communication.
Communications have been sorely lacking for the past several years, and
VA has seemingly resisted keeping us informed of its planning. In the
spirit of the President's very first Executive order, on the
transparency of government, we ask VA do a better job of communicating
with our community, enrolled veterans, labor organizations and VA's own
employees, local government and their affected communities, and other
stakeholders, as the VA capital and strategic planning processes move
forward. It is imperative that all of these groups understand VA's
``big picture'' and how it may affect them. Talking openly and
discussing potential changes will help resolve the understandable angst
about this complex and important question of VA health care
infrastructure. While we agree that VA is not its buildings, and that
the patient should be at the center of VA care and concern, VA must be
able to maintain an adequate infrastructure around which to build and
sustain its patient care system. The time to act is now--our Nation's
veterans deserve no less than our best effort.
Thank you, Mr. Chairman and Members of the Subcommittee. I will
address any questions you may have for the DAV.
Prepared Statement of Hon. Everett Alvarez, Jr., Chairman,
Capital Asset Realignment for Enhanced Services Commission,
U.S. Department of Veterans Affairs
Mr. Chairman and Members of the Subcommittee,
Thank you for the opportunity to appear before the Subcommittee to
discuss the extraordinary work of the Capital Asset Realignment for
Enhanced Services (CARES) Commission.
Let me begin by saying that the Commission believed its mission was
pioneering--not just in terms of an external board assessing
allocations of the VA's capital assets and making recommendations how
these assets should be used, but also doing so while honoring and
preserving the VA's health care and related missions. The
Commissioners, many of whom are veterans themselves, were well aware of
the enormous implications their efforts may have on veterans and the
state of their health care system. We knew we had a moral obligation to
be objective and transparent, because our review would serve as a
blueprint for resource planning at the VA and an approach for medical
care appropriations long after the Commission's work ended. We were
guided, gratefully, by leadership and participation from VA officials,
VA employees across the country, many hundreds of veterans,
familymembers, stakeholders, including Members of Congress, medical and
nursing affiliates and communities at large.
Our efforts are documented in the CARES Commission Report to the
Secretary of Veterans Affairs (VA) dated February 2004. Before I
discuss key components of the Commission's Report, let me take a step
back to provide some historical context that led to the creation of the
CARES Commission and its body of work.
Retrospective Observations
VA CARES Process:
At the time of the Commission's involvement in the VA CARES
process, the Commission believed the CARES process itself was the most
comprehensive assessment ever undertaken by the VA to determine the
capital infrastructure needed to provide modern health care to
veterans.
CARES was a multi-faceted process designed to provide a data-driven
assessment of veteran's health care needs. The process used projected
future demand for health care services, compared the projected demand
against current supply, identified capital requirements and then
assessed any realignments the VA would need in order to meet future
demand for services, improve the access to and quality of services, and
improve the cost effectiveness of the VA's health care system.
Integrated in the overall CARES process was the reliance on input
from the individual Veterans Integrated Service Networks (VISNs) and
local veterans and stakeholders, followed by reviews of the National
CARES Program Office (NCPO), the Under Secretary for Health, the CARES
Commission, and the Secretary of VA.
The CARES process consisted of nine distinct steps. To give you a
sense of the comprehensiveness of the CARES process, briefly let me
outline the nine steps of the CARES process:
Step 1: The NCPO and VISNs created ``markets'' for planning
purposes within each VISN. Markets were based on veteran population,
enrollment, and market share data provided by the NCPO, as well as
local knowledge of transportation and other factors unique to the
community.
Step 2: The VISNs conducted an analysis of the current health care
needs of veterans to identify markets. Future health care needs of
veterans in those markets were projected using the CARES model.
Step 3: The VISNs identified ``planning initiatives'' to describe
the difference between current resources and projected demand.
Step 4: The VISNs developed market-specific plans to address
identified initiatives. A planning decision support system was
developed that included forecasted demand and operating, contracting,
and capital costs derived from the facilities and markets to create a
national methodology for costing alternative approaches. Veteran and
stakeholder input was sought and occurred at the national and field
levels.
Step 5: The Under Secretary for Health reviewed market plans and
developed the Draft National CARES Plan (DNCP), which was issued on
August 4, 2003.
Step 6: The CARES Commission, after reviewing the DNCP and other
information, conducted its review and analysis and then issued its
report to the Secretary with findings and recommendations for enhancing
health care services through alignment of VA's capital assets.
Step 7: Secretary's decision was made to accept, reject, or ask for
additional information on the Commission's recommendations.
Step 8: The VISNs prepared detailed implementation plans and
submitted them to the Secretary for approval.
Step 9: In the final step, VISN planning initiatives and solutions
were refined and integrated in the annual VA strategic planning cycle.
CARES Commission:
Since the CARES process was primarily a VA-internal planning
process, the CARES Commission was established by the Honorable Anthony
J. Principi, former VA Secretary, as an independent body to conduct an
external assessment of the VA's capital asset needs and validate the
findings and recommendations in the DNCP. The Secretary emphasized that
the Commission was not expected to conduct an independent review of the
VA's medical system. However, as we conducted our analysis of the DNCP,
we were expected to maintain a reliance on the views and concerns from
individual veterans, veterans service organizations, Congress, medical
school affiliates, VA employees, local government entities, affected
community groups, Department of Defense (DoD), and other interested
stakeholders.
The CARES Commission's journey began in February, 2003. Even from
the onset it was clear to the Commission that the goal of CARES was to
enhance services to veterans; not to save money--rather, to spend
appropriated funds wisely.
In fulfilling our obligation, Commissioners:
visited 81 VA and DoD medical facilities and State
Veterans Homes;
held 38 public hearings across the country, with at least
one hearing per VISN;
held 10 public meetings; and
analyzed more than 212,000 comments received from
veterans, their families, and stakeholders.
At the public hearings, the Commission had the opportunity to hear
from approximately 770 invited local speakers, including VISN
leadership, veterans and their families, veterans service
organizations, State directors of veterans' affairs, local labor
organizations, medical schools, nursing schools and other allied health
professional affiliates, organizations with collaborative relationships
including the DoD, and local elected officials. Seven Governors and 135
Members of Congress participated or provided statements for Commission
hearings.
On February 12, 2004, I presented The CARES Commission Report to
Secretary Principi. The Commission's findings were grounded on the
compilation of information gathered at the site visits, public
hearings, and meetings as well as information obtained from the public
comments and the VA. It represented the best collective judgment of the
Commissioners, who applied their diverse expertise in making decisions
related to the future of the VA's infrastructure.
Mr. Chairman, with this historical perspective in mind, I would
like to now focus my testimony on two key areas that formed the
foundation, I believe, of the Commission's efforts and that enabled us
to present the independent assessment demanded by our charter. These
foundation areas are: the Commission's goals and the review of the VA
CARES model by outside experts.
Commission's Goals:
Mr. Chairman, the Commission established several critical goals in
order to sustain the highest standard of credibility to our efforts.
First, we maintained an objective point-of-view in order to give an
effective external perspective to the VA CARES process. We set goals to
focus on accessibility, quality, and cost effectiveness of care that
were needed to serve our Nation's veterans. We held a clear line of
sight on the integrity of VA's health care mission and its other
missions. Additionally, since the VA is more than bricks and mortar,
the Commission thoughtfully sought input from stakeholders to minimize
any adverse impact on VA staff and affected communities. Moreover, it
was the Commission's desire to make findings and recommendations that
would provide the VA with a road map for strategically evaluating VA's
capital needs into the future.
VA CARES Demand Model:
During the development of the VISN planning initiatives and
ultimately the DNCP, the VA CARES demand model was the foundation for
projecting the future enrollment of veterans, their utilization of
certain inpatient and outpatient health care services, and the unit
cost of such services. The Commission did not participate in the
development of the model, or the application of the model at the VISN
level. The Commission's role, however, was to review data and analyses
based on the model.
Because the CARES demand model was such an integral component in
the development of the VA's CARES market plans, the Commission wanted a
high level of confidence in the reasonableness of the model as an
analytic approach to projecting enrollment and workload. For this
reason and to foster the Commission's goal to sustain credibility, the
Commission engaged outside experts to examine and explain the technical
aspects of the model. With the help of outside experts the Commission
sought assurance that the CARES model was:
Logical: internally consistent and coherent;
Auditable: open to scrutiny and examination;
Comparable: consistent with known methods or techniques
in common analytical practice;
Defendable: given the range of alternatives available;
Robust: flexible to use for projecting uncertain future
scenarios;
Timely: data used are applicable to the current
environment; and
Verified and Validated: tested to ensure data used were
not skewed in some way.
Based on the experts' analyses, the Commission found the CARES
model did, in fact, serve as a reasonable analytical approach for
estimating VA enrollment, utilization and expenditures. However, there
were lingering concerns noted in the Commission's report relating to
projecting utilization of specialized inpatient and outpatient
services, notably outpatient mental health services, and inpatient
long-term care services (including geriatric and seriously mentally ill
care).
Let me elaborate. The CARES demand model projected only certain
inpatient and outpatient services, such as surgical services and
primary care services. During the Commission's assessment we found that
the initial CARES projections underestimated the demand for outpatient
mental health services as well as long-term mental health services.
Additionally, the Commission noted that projections for long-term care,
including nursing home, domiciliary, and non-acute inpatient and
residential mental health services, were not included in the CARES
projections due to the absence of an adequate model to project future
need for these services. In the case of these noted areas the
Commission made recommendations for immediate corrective action and
development of new planning initiatives.
Prospective Observations
Mr. Chairman, to this point I have provided you and the
Subcommittee with a retrospective look at CARES and have highlighted
key areas of the Commission's efforts. In discussing the Commission's
efforts today, I need to remind everyone that the Commission's findings
and recommendations were based on data, analyses and information that
are more than 5 years old. As you can appreciate veterans' medical
needs, when combined with advances in medicine, psychiatry, medical
technology and health care in general, could make some of the
Commission's findings outdated.
As you are aware, veterans returning home from the wars in Iraq and
Afghanistan often go to the VA for specialized inpatient and outpatient
medical care to facilitate their physical and emotional recovery. The
experience in recent years as a result of the nature of the Iraq and
Afghanistan wars, and with the advances in combat medicine, have meant
that VA is caring for patients with injuries far more complex than ever
before, such as traumatic brain injuries (TBI) and polytraumatic
injuries. For these visible wounds of war the VA has responded by
establishing state-of-the art Polytrauma Rehabilitation Centers and a
diverse supportive system of care that approaches the limits of modern
medicine and knowledge in treating and caring for these patients.
Of equal significance, the nature of the Iraq and Afghanistan
conflicts has placed an emphasis on improving combat and VA health care
to treat PTSD, suicide prevention, and other mental health concerns--
the invisible wounds of war. Because symptoms of PTSD, suicide and
other mental illness may manifest over time, effective mental health
treatment requires appropriate access to a full continuum of mental
health services. The DoD and VA are responding by enhancing psychiatric
and mental health programs and policies, particularly for PTSD and
suicide prevention.
I would suggest that if a ``CARES Commission'' were chartered
today, it would likely assess how the VA integrates advancements in
medicine, psychiatry, science, and health care in the strategic and
resource planning processes. Reflecting on the importance of the CARES
demand model in earlier planning efforts, a ``CARES Commission'' would
likely verify that VA has addressed previously noted shortcomings in
estimating outpatient mental health and inpatient long-term care
services to ensure that the infrastructure planning is keeping pace
with mental health demand and that VA and DoD are capitalizing on
shared treatment capabilities. A Commission might also review the
modeling of polytrauma care, including long-term rehabilitation care to
validate that VA long-term care facilities are being transformed to
embrace the long-term care for younger generation of veterans with
young
families while maintaining a strong sense of commitment to geriatric lon
g-term care.
Closing
Mr. Chairman, this concludes my testimony. I again want to thank
you for allowing me to address the Subcommittee.
Prepared Statement of Mark L. Goldstein, Director,
Physical Infrastructure, U.S. Government Accountability Office
VA HEALTH CARE: OVERVIEW OF VA'S CAPITAL ASSET MANAGEMENT
GAO Highlights
Why GAO Did This Study
Through its Veterans Health Administration (VHA), the Department of
Veterans Affairs (VA) operates one of the largest integrated health
care systems in the country. In 1999, GAO reported that better
management of VA's large inventory of aged capital assets could result
in savings that could be used to enhance health care services for
veterans. In response, VA initiated a process known as Capital Asset
Realignment for Enhanced Services (CARES). Through CARES, VA sought to
determine the future resources needed to provide health care to our
Nation's veterans.
This testimony describes (1) how CARES contributes to VHA's capital
planning process, (2) the extent to which VA has implemented CARES
decisions, and (3) the types of legal authorities that VA has to manage
its real property and the extent to which VA has used these
authorities. The testimony is based on GAO's body of work on VA's
management of its capital assets, including GAO's 2007 report on VA's
implementation of CARES (GAO-07-408).
What GAO Recommends
GAO is not making recommendations in this testimony, but has
previously made a number of recommendations regarding VA's capital
asset management. VA is at various stages of implementing those
recommendations.
What GAO Found
The CARES process provides VA with a blueprint that drives VHA's
capital planning efforts. As part of the CARES process, VA adapted a
model to estimate demand for health care services and to determine the
capacity of its current infrastructure to meet this demand. VA
continues to use this model in its capital planning process. The CARES
process resulted in capital alignment decisions intended to address
gaps in services or infrastructure. These decisions serve as the
foundation for VA's capital planning process. According to VA
officials, all capital projects must be based on demand projections
that use the planning model developed through CARES.
VA has started implementing some CARES decisions, but does not
centrally track their implementation or monitor the impact of their
implementation on its mission. VA is in varying stages (e.g., planning
or construction) of implementing 34 of the major capital projects that
were identified in the CARES process and has completed 8 projects. Our
past work found that, while VA had over 100 performance measures to
monitor other agency programs and activities, these measures either did
not directly link to the CARES goals or VA did not use them to
centrally monitor the implementation and impact of CARES decisions.
Without this information, VA could not readily assess the
implementation status of CARES decisions, determine the impact of such
decisions, or be held accountable for achieving the intended results of
CARES. VA has recently created the CARES Implementation Working Group,
which has identified performance measures for CARES and will monitor
the implementation and impact of CARES decisions in the future.
VA has a variety of legal authorities available, such as enhanced-
use leases, sharing agreements, and others, to help it manage real
property. However, legal restrictions and administrative- and budget-
related disincentives associated with implementing some authorities
affect VA's ability to dispose and reuse property in some locations.
For example, legal restrictions limit VA's ability to dispose of and
reuse property in West Los Angeles and Sepulveda. Despite these
challenges, VA has used these legal authorities to help reduce
underutilized space (i.e., space not used to full capacity). In 2008,
we reported that VA reduced underutilized space in its buildings by
approximately 64 percent from 15.4 million square feet in fiscal year
2005 to 5.6 million square feet in fiscal year 2007. While VA's use of
various legal authorities likely contributed to VA's overall reduction
of underutilized space since fiscal year 2005, VA does not track the
overall effect of using these authorities on space reductions. Not
having such information precludes VA from knowing what effect these
authorities are having on reducing underutilized or vacant space or
knowing which types of authorities have the greatest effect. According
to VA officials, VA will institute a system in 2009 that will track
square footage reductions at the building level.
__________
Mr. Chairman and Members of the Subcommittee:
We appreciate the opportunity to testify on the Department of
Veterans Affairs' (VA) management of its capital assets. As you know,
VA operates one of the largest health care systems in the country. VA,
through its Veterans Health Administration (VHA), provided health care
to almost 5.5 million veterans in 2008.\1\ To support its mission, VA
has a large inventory of real property--including over 150 medical
centers and over 900 outpatient and ambulatory care clinics. However,
many of VA's facilities were built more than 50 years ago and are not
well suited to providing accessible, high-quality, cost-effective
health care in the 21st century. In 1999, we reported that with better
management of its large, aged capital assets, VA could significantly
reduce the funding used to operate and maintain underused, unneeded, or
inefficient properties.\2\ We further noted that the savings could be
used to enhance health care services for veterans. Thus, we recommended
that VA develop market-based plans for realigning its capital assets.
In response, VA initiated a process known as Capital Asset Realignment
for Enhanced Services (CARES)--a comprehensive, long-range assessment
of its health care system's capital asset requirements. The CARES
process included nine distinct steps and required the time and
expertise of many VA officials at the departmental and network
levels.\3\ (See table 1.)
---------------------------------------------------------------------------
\1\ VHA is primarily responsible for VA's health care delivery to
the veterans enrolled for VA health care services and operates the
majority of VA's capital assets.
\2\ GAO, VA Health Care: Capital Asset Planning and Budgeting Need
Improvement, GAO/T-HEHS-99-83 (Washington, D.C.: Mar. 10, 1999).
\3\ VA's health care delivery system is divided into 21 health care
delivery networks. For example, one network serves veterans in Alabama,
Georgia, and South Carolina.
Table 1: Steps of the CARES Process
----------------------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------------------
Step 1: VA officials at the departmental and network level develop market
areas and submarkets as the planning units for analyzing veterans'
needs.
----------------------------------------------------------------------------------------------------------------
Step 2: VA officials at the departmental level conduct market analyses of
veterans' health care needs using standardized forecasts of enrollment
and service needs and actuarial data.
----------------------------------------------------------------------------------------------------------------
Step 3: VA officials at the departmental level identify planning initiatives
that addressed apparent gaps between supply and demand in resources
for each market area.
----------------------------------------------------------------------------------------------------------------
Step 4: VA officials at the Network level consider different alignment
alternatives and develop specific plans for individual markets that
addressed all the planning initiatives identified by VA officials at
the departmental level.
----------------------------------------------------------------------------------------------------------------
Table 1: Steps of the CARES Process--Continued
----------------------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------------------
Step 5: The Under Secretary of Health uses the market plans to prepare a Draft
National CARES Plan (DNCP) and recommendations.
----------------------------------------------------------------------------------------------------------------
Step 6: The Secretary of Veterans Affairs appoints a commission composed of
non-VA executives to make recommendations to the Secretary to accept,
present alternatives to, or reject the recommendations contained in
the DNCP.
----------------------------------------------------------------------------------------------------------------
Step 7: The Secretary of Veterans Affairs decides whether to accept, reject,
or modify the commission's recommendations concerning the DNCP.
----------------------------------------------------------------------------------------------------------------
Step 8: Network officials implement the Secretary's decisions.
----------------------------------------------------------------------------------------------------------------
Step 9: VA officials at the departmental level refine and incorporate CARES
planning initiatives into the annual strategic planning cycle.
----------------------------------------------------------------------------------------------------------------
Source: VA.
According to VA, the CARES process was a onetime major initiative.
However, its lasting result was to provide a set of tools and processes
that allow VA to continually determine the future resources needed to
provide health care to our Nation's veterans. In May 2004, the
Secretary stated that implementing CARES decisions will require an
additional investment of approximately $1 billion per year for at least
the next 5 years, with substantial infrastructure investments then
continuing for the indefinite future, to modernize VA's aging
infrastructure. Although CARES will require substantial investment, the
Secretary noted that not proceeding with CARES would require funding to
maintain or renovate obsolete facilities and would leave VA with
numerous redundant, outmoded, or poorly located facilities. The
Secretary further stated that through the CARES process, VA had
developed more complete information about the demand for VA health care
and a more comprehensive assessment of its capital assets than it had
ever done before. The Secretary noted that this information, along with
the experience gained through conducting CARES, positioned VA to
continue to expand the accuracy and scope of its planning efforts.
In my statement today, I will discuss (1) how CARES contributes to
VHA's capital planning process, (2) the extent to which VA has
implemented CARES decisions, and (3) the types of legal authorities
that VA has to manage its real property and the extent to which VA has
used its authorities to reduce underutilized and vacant property. My
comments are based on our extensive body of work on VA's management of
its capital assets, including recent reviews of VA's implementation of
CARES and management of real property, as well as updated information
from VA officials.\4\
---------------------------------------------------------------------------
\4\ GAO, VA Health Care: Capital Asset Planning and Budgeting Need
Improvement, T-HEHS-99-83 (Washington, D.C.: Mar. 10, 1999); GAO, VA
Health Care: VA Should Better Monitor Implementation and Impact of
Capital Asset Alignment Decisions, GAO-07-408 (Washington, D.C.: Mar.
21, 2007); GAO, VA Health Care: Additional Efforts to Better Assess
Joint Ventures Needed, GAO-08-399 (Washington, D.C.: Mar. 28, 2008);
and GAO, Federal Real Property: Progress Made in Reducing Unneeded
Property, but VA Needs Better Information to Make Further Reductions,
GAO-08-939 (Washington, D.C.: Sept. 10, 2008). These performance audits
and our updated work were conducted in accordance with generally
accepted government auditing standards.
---------------------------------------------------------------------------
Background
Over the past decade, VA's system of health care for veterans has
undergone a dramatic transformation, shifting from predominantly
hospital-based care to primary reliance on outpatient care. As VA
increased its emphasis on outpatient care rather than inpatient care,
it was left with an increasingly obsolete infrastructure, including
many hospitals built or acquired more than 50 years ago in locations
that are sometimes far from where veterans live.
To address its obsolete infrastructure, VA initiated its CARES
process--the first comprehensive, long-range assessment of its health
care system's capital asset requirements since 1981. CARES was designed
to assess the appropriate function, size, and location of VA facilities
in light of expected demand for VA inpatient and outpatient health care
services through fiscal year 2022. Through CARES, VA sought to enhance
outpatient and inpatient care, as well as special programs, such as
spinal cord injury, through the appropriate sizing, upgrading, and
locating of VA facilities. Table 2 lists key milestones of the CARES
process.
Table 2: Key CARES Milestones
----------------------------------------------------------------------------------------------------------------
Date Milestone Description
----------------------------------------------------------------------------------------------------------------
February 2002 VA announced the The pilot study assessed current and fu-
results of a pilot ture use of health care assets in the
CARES study. three markets of Network 12, which
includes parts of five States: Illinois,
Indiana, Michigan, Minnesota, and
Wisconsin. It resulted in decisions to
realign health care services and renovate
or dispose of several buildings consistent
with VA's mission and community zoning
issues.
----------------------------------------------------------------------------------------------------------------
August 2003 VA Under Secretary The Under Secretary's DNCP included
for Health pre- recommendations about health care serv-
sented the DNCP. ices and capital assets in VA's remaining
74 markets. These recommendations
reflected input from managers of VA's
health care networks.
----------------------------------------------------------------------------------------------------------------
February 2004 An independent CARES An independent 16-member commission
Commis- sion issued appointed by the Secretary of Veterans
recom- mendations. Affairs issued recommendations to the
Secretary based on its review of the DNCP
and related documents and information
obtained through public hearings, site
visits, public meetings, written comments
from veterans and other stakeholders, and
consultations with experts.
----------------------------------------------------------------------------------------------------------------
May 2004 VA Secretary The Secretary based his decisions on a
announces the CARES review of the CARES Commission's
decisions. recommendations.
----------------------------------------------------------------------------------------------------------------
January 2005 CARES follow-up VA awarded a contract for additional
studies. studies at 18 VA facilities. These studies
included evaluating outstanding health
care issues, developing capital plans, and
determining the best use for unneeded VA
property consistent with VA's mission and
community zoning issues.
----------------------------------------------------------------------------------------------------------------
May 2008 CARES follow-up All 18 studies are completed.
studies.
----------------------------------------------------------------------------------------------------------------
Source: GAO analysis of VA data.
We have previously reported that a range of capital asset alignment
alternatives were considered throughout the CARES process, which
adheres to capital planning best practices.\5\ Moreover, there was
relatively consistent agreement among the DNCP prepared by VA, the
CARES Commission appointed by the VA Secretary to make alignment
recommendations, and the Secretary as to which were the best
alternatives to pursue. Although the Secretary tended to agree with the
CARES Commission's recommendations, the extent to which he agreed
varied by alignment alternative. In particular, the Secretary always
agreed with the Commission's recommendations to build new facilities,
enter into enhanced use leases, and collaborate with the Department of
Defense and universities, but was less likely to agree with the CARES
Commission's recommendations to contract out or close facilities. The
decisions that emerged from the CARES process will result in an overall
expansion of VA's capital assets. According to VA officials, rather
than show that VA should downsize its capital asset portfolio, the
CARES process revealed service gaps and needed infrastructure
improvements. We also reported that a number of factors shaped and in
some cases limited the range of alternatives VA considered during the
CARES process. These factors included competing stakeholder interests;
facility condition and location; veterans' access to facilities;
established relationships between VA and health care partners, such as
DoD and university medical affiliates; and legal restrictions.
---------------------------------------------------------------------------
\5\ GAO-07-408.
---------------------------------------------------------------------------
The challenge of misaligned infrastructure is not unique to VA. We
identified Federal real property management as a high-risk area in
January 2003 because of the nationwide importance of this issue for all
Federal agencies. We did this to highlight the need for broad-based
transformation in this area, which, if well implemented, will better
position Federal agencies to achieve mission effectiveness and reduce
operating costs. But VA and other agencies face common challenges, such
as competing stakeholder interests in real property decisions. In VA's
case, this involves achieving consensus among such stakeholders as
veterans service organizations, affiliated medical schools, employee
unions, and communities. We have previously reported that competing
interests from local, State, and political stakeholders have often
impeded Federal agencies' ability to make real property management
decisions. As a result of competing stakeholder interests, decisions
about real property often do not reflect the most cost-effective or
efficient alternative that is in the interest of the agency or the
government as a whole but instead reflect other priorities. In
particular, this situation often arises when the Federal Government
attempts to consolidate facilities or otherwise dispose of unneeded
assets.\6\
---------------------------------------------------------------------------
\6\ GAO, High-Risk Series: Federal Real Property, GAO-03-122
(Washington, D.C.: January 2003) and GAO, Federal Real Property:
Progress Made Toward Addressing Problems, but Underlying Obstacles
Continue to Hamper Reform, GAO-07-349 (Washington, D.C.: April 2007).
---------------------------------------------------------------------------
CARES Process and Modeling Tools Drive VHA's Capital Planning Efforts
Through the CARES process, VA gained the tools and information
needed to plan capital investments. As part of the CARES process, VA
modified an actuarial model that it used to project VA budgetary needs.
According to VA, the modifications enabled the model to produce 20-year
forecasts of the demand for services and provided for more accurate
assessments of veterans' reliance on VA services, capacity gaps, and
market penetration rates.\7\ The information provided by the model
allowed VA to identify service needs and infrastructure gaps, in part
by comparing the expected location of veterans and demand for services
in years 2012 through 2022 with the current location and capacity of VA
health care services within each network. In addition to modifying the
model, VA conducted facility condition assessments on all of its real
property holdings as part of the CARES process. These assessments
provided VA information about the condition of its facilities,
including their infrastructure needs. VA continues to use the tools
developed through CARES as part of its capital planning process. For
example, VA conducts facility condition assessments for each real
property holding every 3 years on a rotating basis. In addition, VA
uses the modified actuarial model to update its workload projections
each year, which are used to inform the annual capital budget process.
---------------------------------------------------------------------------
\7\ We did not evaluate the reliability of the model or its
projections.
---------------------------------------------------------------------------
The CARES process serves as the foundation for VHA's capital
planning efforts. The first step in VHA's capital budget process is for
networks to submit conceptual papers that identify capital projects
that will address service or infrastructure gaps identified in the
CARES process.\8\ The Capital Investment Panel, which consists of
representatives from each VA administration and staff offices, reviews,
scores, and ranks these papers. The Capital Investment Panel also
identifies the proposals that will be sent forward for additional
analysis and review, and may ultimately be included as part of VA's
budget request. According to VA officials, all capital projects must be
based on the CARES planning model to advance through VHA's capital
planning process. On the basis of CARES-identified infrastructure needs
and service gaps, VA identified more than 100 major capital projects in
37 States, the District of Columbia, and Puerto Rico.\9\ In addition to
these projects, the CARES planning model identified service needs and
infrastructure gaps at other locations throughout the VA system. The
model is updated annually to reflect new information.
---------------------------------------------------------------------------
\8\ CARES conceptual papers are created at the network level and
provide a detailed description of the project, the problem the project
will address, and other relevant information.
\9\ The term ``major capital project'' refers to a project for the
construction, alteration, or acquisition of a medical facility
involving a total expenditure of more than $10 million. (See 38 U.S.C.
Sec. 8104.) In contrast, a ``minor capital project'' refers to the
construction, alteration, or acquisition of a medical facility
involving a total expenditure of $10 million or less.
---------------------------------------------------------------------------
VHA's 5-year Capital Plan outlines CARES implementation and
identifies priority projects that will improve the environment of care
at VA medical facilities and ensure more effective operations by
redirecting resources from the maintenance of vacant and underutilized
buildings to investments in veterans' health care. In VA's fiscal year
2010 budget submission, VA requested about $1.1 billion to fund 12 VHA
major construction projects and about $507 million for VHA minor
construction projects.
Some CARES Decisions Implemented, But Additional Information Needed to
Fully Assess Status and Impact of Decisions
VA has begun implementing some CARES decisions. Specifically, VA is
currently in varying stages (e.g., planning or construction) of
implementing 34 of the major capital projects that were identified in
the CARES process. Eight major capital CARES projects are complete.
Although VA is moving forward with the implementation of some CARES
decisions, we previously reported that a number of VA officials and
stakeholders, including representatives from veterans service
organizations and local community groups, view the implementation
process as too lengthy and lacking transparency.\10\ For instance,
stakeholders in Big Spring, Texas, noted that it took almost 2 years
for the Secretary to decide whether to close the facility. During this
period, there was a great deal of uncertainty about the future of the
facility. As a result, there were problems in attracting and retaining
staff at the facility, according to network and local VA officials. We
also previously reported that a number of stakeholders we spoke with
indicated that the implementation of CARES decisions has been
influenced by competing stakeholders' interests--thereby undermining
the process.\11\ In its February 2004 report, the CARES Commission also
noted that stakeholder and community pressure can act as a barrier to
change, by pressuring VA to maintain specific services or facilities.
---------------------------------------------------------------------------
\10\ GAO-07-408.
\11\ GAO-07-408.
---------------------------------------------------------------------------
In 2007, we reported that VA does not use, or in some cases does
not have, performance measures to assess its progress in implementing
CARES or whether CARES is achieving the intended results. Performance
measures allow an agency to track its progress in achieving intended
results. Performance measures can also help inform management
decisionmaking by, for example, indicating a need to redirect resources
or shift priorities. In addition, performance measures can be used by
stakeholders, such as veterans service organizations or local
communities, to hold agencies accountable for results. Although VA has
over 100 performance measures to monitor other agency programs and
activities, these measures either do not directly link to the CARES
goals or VA does not use them to centrally monitor the implementation
and impact of CARES decisions.\12\ We also reported that VA lacked
critical data, including data on the cost of and timelines for
implementing CARES projects and the potential savings that can be
generated by realigning resources.
---------------------------------------------------------------------------
\12\ Officials from the Office of Asset Enterprise Management told
us that they had information on the status of CARES projects that were
included in the 5-year capital plan, but that they did not track the
status of all CARES decisions.
---------------------------------------------------------------------------
Given the importance of the CARES process, we previously
recommended that VA develop performance measures for CARES. Such
measures would allow VA officials to monitor the implementation and
impact of CARES decisions as well as allow stakeholders to hold VA
accountable for results. In responding to our recommendation, VA
created the CARES Implementation Monitoring Working Group. This working
group has identified performance measures for CARES and the group will
monitor the implementation and impact of CARES decisions.
VA Has a Variety of Legal Authorities to Manage Real Property, But Does
Not Track How Using Them Contributes to the Reduction in
Underutilized Property
VA has a variety of legal authorities available to help it manage
real property. These authorities include enhanced-use leases (EUL),
sharing agreements, and outleases. (See table 3 for descriptions of
these authorities.) VA uses these authorities to help reduce
underutilized and vacant property. For example, in 2005, in Lakeside
(Chicago), Illinois, VA reduced its underutilized property at the
medical center by nearly 600,000 square feet by using its EUL authority
with Northwestern Memorial Hospital. VA also uses these authorities to
generate financial benefits. For example, the VA Greater Los Angeles
Healthcare System enters into a number of sharing agreements with the
film industry. VA officials told us that these agreements are typically
temporary arrangements--sometimes lasting a few days--during which film
production companies use VA facilities to shoot television or movie
scenes. According to VA officials, these agreements generate roughly $1
million to $2 million a year.
Table 3: Major Types of Authorities Available to VA
----------------------------------------------------------------------------------------------------------------
Authority Definition Proceeds
----------------------------------------------------------------------------------------------------------------
Enhanced-use VA leases underutilized or Proceeds generated from the
leases (EUL) vacant property to a public or EUL are used to pay for
private entity for up to 75 expenses incurred by VA in
years
38 U.S.C. if the agreement enhances the connection with the EUL
Sec. Sec. 8161-8169 use of the property or results and can be used for any
in an improvement of services to expense incurred in the
veterans in the network in which development of future EULs.
the property is located. The EUL Any remaining funds are to
shall be for fair con- be deposited in the VA
sideration, and lease payments Medical Care Collections
may be monetary or be made for Fund. At the discretion of
in-kind consideration, such as the VA Secretary, proceeds
construction, repair, or also may be deposited into
remodeling of Department construction major project
facilities; providing office, and construction minor
storage, or other usable space; project accounts to be used
or for services, programs, or for construction,
facilities that enhance services alterations, and
to veterans. improvements of any medical
facility.
----------------------------------------------------------------------------------------------------------------
Sharing VA may enter into sharing Proceeds generated from
agreements agreements to provide the use of sharing agreements are to be
VHA space (including park- credited to the applicable
38 U.S.C. ing, recreational facilities, Department medical appro-
and
Sec. Sec. 8151-8153 vacant land) for the benefit of priation of the facility
veterans or nonveterans in that furnished the space.
exchange for payment or services
if VA's resources would not be
used to their maximum effective
capacity and would not adversely
affect the care of veterans.
Sharing agreements do not convey
an interest in real property and
can be entered into for up to 20
years, with the initial term not
to exceed 5 years.
----------------------------------------------------------------------------------------------------------------
Outlease VA's outlease-related author- Proceeds generated from
ities include the following: outleases of VHA space,
38 U.S.C. Sec. 8122 minus expenses for mainte-
Outlease: VA may lease real nance, operation, and repair
38 U.S.C. Sec. 2412 property to public or private of buildings leased for
interests outside of VA for up build- ing quarters, are
to 3 years, or up to 10 years deposited into the
for a National Cemetery Department of the Treasury
Administra- tion (NCA) property. as miscellaneous receipts.
Lease pProceeds generated fromor
mainte- nance, protection, or outleases of NCA prop- erty
restoration of the property as are to be deposited into the
part of the consideration of the NCA Facilities Opera- tion
lease. Fund and are available for
costs incurred by NCA for
Licoperations and mainte- nance
party permission to enter upon of NCA property. Proceeds
and do a specific act or series generated from licenses and
of acts upon the land without permits are deposited into
possessing or acquiring any the Depart- ment of the
estate therein. A license can be Treasury.
revoked at any time.
Permit: Gives another Federal
agency permission to enter upon
and do a specific act or series
of acts upon the land without
possessing or acquiring any
estate therein. The permit can
be revoked at any time.
----------------------------------------------------------------------------------------------------------------
Source: GAO.
However, legal restrictions associated with implementing some
authorities affect VA's ability to dispose of and reuse property in
some locations. For example, legal restrictions limit VA's ability to
dispose of and reuse property in West Los Angeles and North Hills
(Sepulveda) California. The Cranston Act of 1988 precluded VA from
taking any action to dispose of 109 of 388 acres in the West Los
Angeles medical center and 46 acres of the Sepulveda ambulatory care
center.\13\ In 1991, when EUL authority was provided to VA, VA was
prohibited from entering into any EUL relating to the 109 acres at West
Los Angeles unless the lease was specifically authorized by law or for
a childcare center.\14\ The Consolidated Appropriations Act of 2008
expanded the EUL restrictions to include the entire West Los Angeles
medical center.\15\ The Consolidated Appropriations Act of 2008 also
prohibits VA from declaring as excess or otherwise taking action to
exchange, trade, auction, transfer, or otherwise dispose of any portion
of the 388 acres within the VA West Los Angeles medical center.
---------------------------------------------------------------------------
\13\ P.L. No. 100-322, Section 421(b)(2), 102 Stat. 487, 553
(1988).
\14\ 38 U.S.C. Sec. 8162(c).
\15\ P.L. No. 110-161, Section 224(a), 121 Stat. 1844, 2272 (2007).
---------------------------------------------------------------------------
Budgetary and administrative disincentives associated with some of
VA's available authorities may also limit VA's ability to use these
authorities to reduce its inventory of underutilized and vacant
property. For example:
VA cannot retain revenue that it obtains from outleases,
revocable licenses, or permits; such receipts must be deposited in the
Department of the Treasury.\16\ VA has said that, except for EUL
disposals, restrictions on retaining proceeds from disposal of
properties are a disincentive for VA to dispose of property.\17\
---------------------------------------------------------------------------
\16\ 38 U.S.C. Sec. 8122.
\17\ 38 U.S.C. Sec. 8164.
---------------------------------------------------------------------------
In 2004, VA was authorized until 2011 to transfer real
property under its jurisdiction or control and to retain the proceeds
from the transfer in a capital asset fund for property transfer costs,
including demolition, environmental remediation, and maintenance and
repair costs.\18\ In our previous work, we reported several
administrative and oversight challenges with using capital asset
funds.\19\ Moreover, VA officials told us that this authority has
significant limitations on the use of any funds generated by disposal.
For example, VA officials we spoke with reported that the capital asset
fund is too cumbersome to be used, and VA does not have immediate
access to the funds because they have to be reappropriated before VA
can use them.
---------------------------------------------------------------------------
\18\ 38 U.S.C. Sec. 8118.
\19\ GAO, Capital Financing: Potential Benefits of Capital
Acquisition Funds Can Be Achieved through Simpler Means, GAO-05-249
(Washington, D.C.: Apr. 8, 2005).
---------------------------------------------------------------------------
The maximum term for an outlease, according to VHA law,
is 3 years; according to VA officials, this time limit can discourage
potential lessees from investing in the property.
Implementing an EUL agreement can take a long time.
According to VA officials, EULs are a relatively new tool, and every
EUL is unique and involves a learning process. In addition, VA
officials commented that the EUL process can be complicated. According
to VA officials, the average time it takes to implement an EUL can
range generally from 9 months to 2 years. The officials noted that land
due diligence requirements (such as environmental and historic
reviews), public hearings, Congressional notification, lease drafting,
negotiation, and other phases contribute to the length of the overall
process. VA has taken actions to reduce the time it takes to implement
an EUL agreement, but despite changes to streamline the EUL process,
some officials stated that it is still time consuming and cumbersome.
VA can dispose of underutilized and vacant property under
the McKinney-Vento Act to other Federal agencies and programs for the
homeless.\20\ However, VA officials stated that disposing of property
under the McKinney-Vento Act also can be time-consuming and
cumbersome.\21\ According to VA officials, the process can average 2
years. Under this law, all properties that the Department of Housing
and Urban Development deems suitable for use by the homeless go through
a 60-day holding period, during which the property is ineligible for
disposal for any other purpose. Interested representatives of the
homeless submit to the Department of Health and Human Services (HHS) a
written notice of their intent to apply for a property for homeless use
during the 60-day holding period. After applicants have given notice of
their intent to apply, they have up to 90 days to submit their
application to HHS, and HHS has the discretion to extend the timeframe
if necessary. Once HHS has received an application, it has 25 days to
review, accept, or decline the application.
---------------------------------------------------------------------------
\20\ VA properties that are leased to another party under an EUL
are not considered to be unutilized or underutilized for purposes of
the McKinney-Vento Act (see 38 U.S.C. Sec. 8162).
\21\ We have reported elsewhere on this process. See GAO, Federal
Real Property: Most Public Benefit Conveyances Used as Intended, but
Opportunities Exist to Enhance Federal Oversight, GAO-06-511
(Washington, D.C.: June 21, 2006).
Furthermore, according to VA officials, VA may not receive
compensation from agreements entered into under the McKinney-Vento Act.
Despite these challenges, VA has used these legal authorities to
help reduce its inventory of unneeded space. In 2008, we reported that
VA reduced underutilized space (i.e., space not used to full capacity)
in its buildings by approximately 64 percent from 15.4 million square
feet in fiscal year 2005 to 5.6 million square feet in fiscal year
2007.\22\ Although the number of vacant buildings decreased over the
period, the amount of vacant space remained relatively unchanged at 7.5
million square feet. We estimated VA spent $175 million in fiscal year
2007 operating underutilized or vacant space at its medical
facilities.\23\
---------------------------------------------------------------------------
\22\ See GAO-08-939. The underutilized square footage numbers that
we report are different from those that VA reports. Our analysis only
included underutilized square feet, whereas when VA measures its rate
of utilization, it adds together underutilized square feet and
overutilized square feet (additional square feet needed at a facility).
\23\ GAO developed this estimate because VA does not track the cost
of operating underutilized and vacant building space at the building
level and has not developed a reliable method for doing so.
---------------------------------------------------------------------------
While VA's use of various legal authorities, such as EULs and
sharing agreements, likely contributed to VA's overall reduction of
underutilized space since fiscal year 2005, VA does not track the
overall effect of using these authorities on its space reductions.
Without such information, VA does not know what effect these
authorities are having on its effort to reduce underutilized or vacant
space or which types of authorities have the greatest effect. We
concluded that further reductions in underutilized and vacant space
will largely depend on VA developing a better understanding of why
changes occurred and what impact these agreements had. Therefore, we
recommended in our 2008 report that VA track, monitor, and evaluate
square footage reductions and financial and nonfinancial benefits
resulting from new agreements at the building level by fiscal year in
order to better understand the usefulness of these authorities and
their overall effect on VA's inventory of underutilized and vacant
property from year to year.\24\ The officials said that tracking
financial benefits will require a real property cost accounting system
which VA is in the process of developing. According to VA officials, VA
will institute a system in June 2009 that will track square footage
reductions at the building level, but the system will not track
financial benefits at this level.
---------------------------------------------------------------------------
\24\ GAO-08-939.
---------------------------------------------------------------------------
Mr. Chairman, this concludes my prepared statement. I would be
pleased to respond to questions from you or other Members of the
Subcommittee.
GAO Contact and Staff Acknowledgments
For further information on this statement, please contact Mark L.
Goldstein at (202) 512-2834 or [email protected]. Contact points for
our Offices of Congressional Relations and Public Affairs may be found
on the last page of this statement. Individuals making key
contributions to this testimony were Nikki Clowers, Hazel Gumbs, Edward
Laughlin, Susan Michal-Smith, and John W. Shumann.
Prepared Statement of Donald H. Orndoff,
AIA Director, Office of Construction and Facilities Management,
U.S. Department of Veterans Affairs
Mr. Chairman and Members of the Committee, I am pleased to appear
today to discuss the status of the Department of Veteran Affairs' (VA)
health care infrastructure, our strategic facilities planning process,
our facility design objectives, our acquisition strategies, and our
proposed Fiscal Year 2010 budget. Joining me today are Brandi Fate,
Director of the Veterans Health Administration's (VHA's) Office of
Capital Asset Management and Planning Service; James M. Sullivan,
Director of VA's Office of Asset Enterprise Management; and Lisa
Thomas, Ph.D., FACHE, Director of VHA's Office of Strategic Planning
and Analysis.
Current Medical Infrastructure
VA has a real property inventory of more than 5,400 owned
buildings, 1,300 leases, 33,000 acres of land and approximately 159
million gross square feet (owned and leased). The average age of VA
facilities is well over 50 years. Our older facilities were not
designed to meet the changing demands of clinical care in the 21st
century. Therefore, VA's continuing program of recapitalization of
these aging assets is very important to providing world-class health
care to veterans now and into the future.
Current Major Construction Program
The Department is currently implementing its largest capital
investment program since the immediate post-World War II period. Since
2004, VA has received appropriations totaling $4.6 billion for health
care projects, including 51 major construction projects for new or
improved facilities across the Nation. These projects include new and
replacement medical centers; polytrauma rehabilitation centers, spinal
cord injury centers; ambulatory care centers; new inpatient nursing
units; and projects to improve the safety of VA facilities. Thirty-six
of the 51 projects have been fully funded at a total cost of
approximately $3.1 billion. The remaining 15 projects have received
partial funding totaling $1.6 billion against a total estimated cost of
$4.5 billion. For these larger projects, VA requests design and
construction funding in increments aligned with the projected multi-
year acquisition schedule.
Background: CARES
In 2000, the Veterans Health Administration (VHA) embarked on the
Capital Asset Realignment for Enhanced Services (CARES) process to
provide a data-driven assessment of veterans' health care needs and to
guide the strategic allocation of capital assets to support delivery of
health care services over the next 20 years. The CARES program assessed
veterans' health care needs in each Veterans Integrated Service Network
(VISN), identified service delivery options to meet those needs, and
promoted strategic realignment of capital assets to satisfy identified
needs. The goal was to improve access and quality of health care in the
most cost effective manner, while mitigating impacts on staffing,
communities, and on other VA missions.
VA began the CARES process in 2000 with a regional pilot, then in
2002 expanded nationally. In 2003, VA released its Draft National CARES
plan and created the CARES Commission, an independent panel established
to review VA's plans. The Secretary published his decisions in May 2004
and identified 18 sites whose complexity warranted additional study. VA
completed these studies in May 2008. One output of the CARES process is
the development of a Five-Year Capital Plan that lists and ranks
specific major construction projects.
Today: Strategic Facilities Planning Process
The lessons learned through CARES are now incorporated into VA's
strategic health care and facilities planning process. VHA no longer
distinguishes between CARES and non-CARES planning as the tools and
techniques acquired through CARES have become part of our standard
operating procedures for strategic planning within our health care
system.
VA uses a multi-characteristic decision methodology in prioritizing
its capital investment needs. Appropriate ``joint'' VA-DoD projects are
evaluated to promote sharing and efficiency opportunities. Through this
strategic facilities planning process, VA annually updates its Five-
Year Capital Plan, which supports the development of VA's annual
capital acquisition funding request.
VHA employs its Health Care Planning Model to strategically assess
demographic data, anticipated workload, and actuarial projections for
health care services. VHA compares this data to its capital asset
inventory to identify gaps in capability. To close gaps, VHA develops
investment solutions that may become capital infrastructure projects.
All proposed projects undergo thorough cost effectiveness, risk, and
alternatives analyses.
The Department's Capital Investment Panel (CIP) reviews, scores,
and priority ranks potential projects based on criteria considered
essential to providing high-quality health care services. The scoring
criteria include enhancement of service delivery, meeting workload
projections, safeguarding assets, supporting special emphasis programs,
addressing capital asset management priorities, promoting department
alignment, and eliminating facility deficiencies. The CIP integrates
both new and existing program requirements into a single prioritized
project list.
The CIP reports its analysis to the Strategic Management Council
(SMC) for review. The SMC is VA's governing body responsible for
overseeing VA's capital programs and initiatives. The SMC submits its
recommendations to the Secretary, who makes the final decision on which
projects to include in the budget.
Project Design Goal: High-Performance Medical Facilities
New VA medical facilities will contribute to world-class health
care for veterans today, tomorrow, and well into the 21st century. Our
design goal is to deliver high-performance buildings that are:
Functional, providing cutting-edge clinical spaces that
leverage the latest medical technologies to produce the highest
possible health care outcomes.
Cost efficient, incorporating evidence-based design for
clinical spaces that are efficiently sized and configured to maximize
clinical capability for invested capital.
Veteran-centric, placing special emphasis on design that
is veteran patient and family centered. Buildings welcome patients and
visitors with effective way finding, open circulation and waiting
areas, and expected amenities.
Adaptable, creating buildings that will serve generations
of veterans not yet born. Our buildings must be flexible to adapt and
support continual changing clinical practices, advancing technology,
and medical research. Buildings are designed with engineering systems
organized in interstitial levels between occupied floors to enable
rapid and less expensive reconfiguration of clinical spaces.
Sustainable, setting a standard of designing our medical
centers to a minimum Leadership in Environmental and Energy Design
(LEED) Silver level as defined by the U.S. Green Building Council, and
following all relevant Executive Orders, including the High Performance
& Sustainable Buildings Guidance required under E.O. 13423.
Energy efficient, designing new facilities to meet or
exceed energy reduction targets of the Energy Policy Act of 2005 and
related Executive Orders, shrinking energy use 30 percent below
American Society of Heating, Refrigerating and Air-Conditioning
Engineers (ASHRAE) standards. VA is committed to incorporating
renewable energy technologies in the design of new or renovated
facilities.
Physically secure, ensuring medical facilities are
designed to fully comply with stringent physical security guidelines
for mission critical, high-occupancy Federal facilities. This includes
hardened structures, perimeter and access control, redundancy and
modularity. Water storage, emergency power, and fuel supplies are sized
to enable continued health care operations for 4 days in the face of
natural or man-made disaster.
Acquisition Strategies
VA uses a range of acquisition tools that are tailored to best
satisfy the unique requirements of each project.
For design acquisition, VA selects partners through a targeted
Architect/Engineer (A/E) contract solicitation. Our selection process
values past performance and experience on health care projects of
similar complexity. We carefully evaluate the experience and
capabilities of the key members of the proposed design team. We require
our design partners to leverage the power of Building Information
Modeling (BIM) as a common communication and collaboration tool. We
engage peer review from separate A/E firms to assist the owner's review
of proposed design solutions in meeting required design criteria and
standards.
For construction acquisition, VA uses a range of contract vehicles,
including:
Design-Bid-Build, where we fully develop the project
design and use best value selection process, which assesses both
technical and cost proposals. We typically use this contract vehicle
for large, complex medical facility projects, such as large medical
clinics.
Design-Build, where a single contractor performs both the
design development and the construction. We typically use this approach
for smaller, less complex projects, such as parking structures.
Integrated Design-Construct, where we bring the general
contractor on board early in the design process, initially performing
construction management functions, then construction work as design
packages become available. This is VA's version of CM@Risk approach
that is widely used in the private sector of the construction industry.
We plan to use this use approach on our largest, most complex projects,
such as new medical centers.
Operating Leases, where we engage a developer to act as
owner, designer, and constructor of ``build to suit'' leases. VA pays
annual lease payments for terms up to 20 years. We typically use this
strategy for smaller projects where VA does not currently own property,
such as outpatient clinics.
Construction Management, where we augment our capacity to
perform the important owner role for cost analysis, schedule control,
and field testing. We typically use CM support on larger, more complex
projects, such as new medical centers.
VA is a leader among Federal agencies in meeting socio-economic
goals for small business categories. We place special emphasis on
contracting with veteran-owned businesses, especially service disabled
veteran-owned businesses.
Fiscal Year 2010 Request
VA's FY10 budget request continues our recapitalization effort
supported by our strategic facilities planning process.
VA requests $1.1 billion in FY 2010 for major construction to
replace or enhance VA medical facilities. Of this amount, $649 million
provides construction funding for five ongoing projects at Denver, CO;
Orlando, FL; San Juan, PR; St. Louis (JB), MO; and Bay Pines, FL.
Another $211 million will design seven new projects at Livermore, CA;
Canandaigua, NY; San Diego, CA; Long Beach, CA; St. Louis (JC), MO;
Brockton, MA; and Perry Point, MD. The remainder of the major
construction request will provide funds for advance planning, facility
security, judgment fund and land acquisition needs.
VA requests $196 million authorization for 15 new major medical
leases. Lease projects are located at Anderson, SC; Atlanta, GA;
Bakersfield, CA; Birmingham, AL; Butler, PA; Charlotte, NC;
Fayetteville, NC; Huntsville, AL; Kansas City, KS; Loma Linda, CA;
McAllen, TX; Monterey, CA; Montgomery, AL; Tallahassee, FL; and
Winston-Salem, NC.
Conclusion
In closing, I thank the Committee for its continued support to
improve the Department's physical infrastructure to meet the changing
needs of America's veterans. We look forward to continuing to work with
the Committee on these important issues. Thank you for the opportunity
to appear before the Committee today. My colleagues and I stand ready
to answer your questions.
POST-HEARING QUESTIONS AND RESPONSES FOR THE RECORD
Committee on Veterans' Affairs
Subcommittee on Health
Washington, DC.
June 18, 2009
Honorable Eric K. Shinseki
Secretary
U.S. Department of Veterans Affairs
810 Vermont Avenue, NW
Washington, D.C. 20420
Dear Secretary Shinseki:
Thank you for the testimony of Donald H. Orndoff, Director of the
Office of Construction and Management at the U.S. House of
Representatives Committee on Veterans' Affairs Subcommittee on Health
Oversight Hearing on ``Assessing CARES and the Future of VA's Health
Infrastructure'' that took place on June 9, 2009.
Please provide answers to the following questions by July 30, 2009,
to Jeff Burdette, Legislative Assistant to the Subcommittee on Health.
1. How does VA collaborate and coordinate with Federal Qualified
Health Care Centers to increase the access points for obtaining health
care?
2. In their testimony, GAO highlighted that VA has a variety of
legal authorities to manage real property, but does not track how using
them contributes to the reduction in underutilized property. What is
your response?
3. Since the release of the May 2004 CARES report, has VA
delivered on the CARES promise?
a. Which decisions has VA implemented and which have yet to be
implemented? What are the reasons for the delay in moving forward with
the decisions which have not been implemented, to date?
b. Which CARES decisions has VA changed course on? What are the
reasons for this reversal?
4. The prolonged implementation process leads to a great deal of
uncertainty about the future of the facility so that it leads to staff
retention issues and, more importantly, leaves our veterans without
access to a health care facility. What is your response to these
concerns? What steps is VA taking to ensure timely construction of VA
medical facilities?
5. How much did VA spend to develop the CARES report? At the time
of the CARES report, did VA estimate the funding needed to fully
implement each of the capital planning decisions for inpatient and
outpatient care? How much has VA spent, to date, on the implementation
of the CARES decision? What additional funding is needed to complete
the implementation of the CARES decision?
6. VA's testimony states that ``the tools and techniques acquired
through CARES'' have been integrated into VA's standard operating
procedure with regard to strategic planning. How has this process
changed from before CARES?
7. VA's testimony stresses the importance of ensuring that VA
facilities are adaptable so that they may seamlessly accommodate the
development of new clinical practices and technology. Can you elaborate
on how VA ensures that its facilities meet this standard of
flexibility?
Additionally, please answer the following question from Congressman
Joe Donnelly for Lisa Thomas, Director of the Veterans Health
Administration's Office of Strategic Analysis and Planning.
Dr. Lisa Thomas, I am a firm believer in optimizing health care and
making sure veterans get the most accessible, highest-quality care we
can give them with the resources with which we are entrusted.
Accessibility to specialty care is an issue of particular concern to my
district and to many districts nationwide. For example, St. Joseph
County in my district has a population of more than a quarter million
people, yet area veterans must too often drive more than 2 hours each
way to get to the nearest VA hospital for specialty care. While there
is an excellent outpatient clinic in South Bend, it is unable to
provide many needed services.
I am very pleased that the VA will open a new expanded health
center in South Bend for outpatient and specialty care in 2012. The
authorized facility will be 60-70,000 square feet and more than 10
times bigger than our current CBOC. The outpatient facility will
provide comprehensive examination services in cardiology, podiatry,
outpatient surgery and other medical specialties, wellness programs and
ultrasound exams. Special services will also be available for newly
returning veterans from Iraq and Afghanistan. Further, VA will contract
with local hospitals in the South Bend area to provide inpatient
services for area veterans.
I would like to know if the arrangement announced for South Bend
might be a model that constitutes future health care that the VA plans
to expand on as it looks in the near and long-term for opportunities to
provide enhanced quality care and greater access to veterans?
What is the future of enhanced use lease agreements as it pertains
to strategic planning and please elaborate on these agreements' worth
to VA and possible uses in the future?
Thank you again for taking the time to answer these questions. The
Committee looks forward to receiving your answers by July 30, 2009.
Sincerely,
MICHAEL H. MICHAUD
Chairman
__________
Questions for the Record
The Honorable Michael H. Michaud, Chairman
Subcommittee on Health, House Committee on Veterans' Affairs
June 9, 2009
Accessing CARES and the Future of VA's Health Infrastructure
Question 1: How does VA collaborate and coordinate with Federal
Qualified Health Care Centers to increase the access points for
obtaining health care?
Response: When the Department of Veterans Affairs (VA) identifies
an area with a demonstrated health care need and engages to expand care
in that area, the method for care delivery is determined at the local
level, and avenues for delivery of care are considered to close the
service gap. The range of initiatives include providing direct care
through VA staffed clinics and telehealth, as well as purchasing
services with local providers. When the decision is made to purchase
care, VA considers all eligible available health care provider options,
including Federal Qualified Health Centers (FQHC), to meet the health
care needs of veterans living in rural and highly rural areas. In the
majority of instances, service delivery decisions are made at the local
level.
Although the service delivery decisions are made at the local
level, Office of Rural Health (ORH) has collaborated with the Veterans
Integrated Service Networks (VISN) and recently funded two projects (in
executing of appropriations provided under Public Law 110-329) that
collaborate with FQHCs to increase access points to health care.
The Veterans Health Administration (VHA) Office of Geriatrics and
Extended Care (GEC) was awarded funding to implement a national
initiative to expand Home-Based Primary Care (HBPC) to Community-Based
Outpatient Clinics (CBOC). This initiative will support implementation
of HBPC in rural and highly rural CBOCs and non-VA community clinics,
located across VA's health care system. The expanded service delivery
will help to address issues of access and quality of health care for
some of our most medically complex veterans. Of the chosen sites, GEC
proposes to co-locate their HBPC satellite team in FQHCs and
cooperatively recruit staff when feasible.
ORH also awarded funding to VISN 1 for an initiative to extend
telemental health in rural Vermont. This initiative will create a
partnership with non-Federal entities through a community-based
telemental health program and provide access to specialized VA mental
health services for veterans where travel to a CBOC is difficult or
prohibitive. Services will be provided within existing non-VA community
primary care practices in the most rural and inaccessible areas of
Vermont and New Hampshire. Interactive audiovisual telecommunications
will be used to provide direct care to veterans as well as educate
local providers to enhance their ability to recognize veteran-specific
psychological difficulties. The first year will pilot a telemental
health link between the White River Junction VA medical center to a
FQHC and a community mental health center in Northern Vermont. During
the second year, another FQHC will be added in Northern Vermont along
with an additional site in New Hampshire. Application of the model to
other clinics will be assessed during the second year.
ORH fully supports increasing access points and has implemented
several other initiatives to address the needs of veterans in rural
areas. Ongoing initiatives include the four rural mobile health clinics
located in VISNs 1, 4, 19, and 20, as well as the network of outreach
clinics that serve to increase the access to health care for thousands
of veterans across the country.
VA and ORH will continue to develop relationships with experts in
rural health and in veterans' health to explore, assess, and develop
collaborative approaches to providing services for veterans in rural
areas.
Question 2: In their testimony, GAO highlighted that VA has a
variety of legal authorities to manage real property, but does not
track how using them contributes to the reduction in underutilized
property. What is your response?
Response: VA uses its various legal authorities for managing its
real property, such as enhanced-used leasing (EUL) and disposal
authority. VA then tracks the property reductions through the EUL
report and the EUL and disposal sections of the capital plan in the
annual budget submissions.
GAO in its report entitled Federal Real Property: Progress Made in
Reducing Unneeded Property, but VA Needs Better Information to Make
Further Reductions (GAO-08-939) recommended that VA track, monitor, and
evaluate square footage reductions and financial and non-financial
benefits when recording new agreements as of FY 2008. VA agreed with
GAO's recommendation and VA does track revenue generated, square
footage reductions, and services received through agreements, although
this is not accomplished systematically. VA produces an annual report
on EULs for Congress that describes the financial and non-financial
impacts of its EULs. The report includes estimates of the amount of
money VA saves on purchasing energy and parking and the value of new
services available to veterans or employees as a result of EULs.
However, VA does not conduct a similar analysis for other types of
agreements, which greatly outnumber the EULs and VA's data systems do
not provide information on the non-financial benefits it receives from
those agreements. VA will track, monitor, maintain and evaluate square
foot reductions and financial and non-financial benefits resulting from
agreements for FY 2008 and beyond second quarter FY 2009 to ascertain
the cumulative effect of its authorities on underused and vacant
property square footage. We will identify baseline space for the
buildings and metrics for reductions resulting from agreements.
----------------------------------------------------------------------------------------------------------------
Planned Actual
Milestone Complete Complete Status
----------------------------------------------------------------------------------------------------------------
Identify buildings and agreements 3/3/2009 3/30/2009 Complete
for tracking
----------------------------------------------------------------------------------------------------------------
Establish baseline space and costs 5/30/2009 5/30/2009 Complete
for buildings to be tracked
----------------------------------------------------------------------------------------------------------------
Establish reporting and analysis for 9/30/2009 Pending BI
building impacts resulting from release 1.5 and
agreements CAI upgrade
----------------------------------------------------------------------------------------------------------------
Collect detailed building level costs 9/30/2012 Pending FLITE
for tracking agreement impact implementation
----------------------------------------------------------------------------------------------------------------
Disposal of underutilized space is a major focus area in VA 5-year
disposal plans. VA issues a yearly call for disposals, identifying
underused and non-mission dependent buildings as potential disposals to
the field/Administrations. As summarized below, over the period FY 2009
through FY 2013, VA plans to dispose of 414 buildings (7,145,741 square
feet) and 313.5 acres of land.
----------------------------------------------------------------------------------------------------------------
VA Disposal Plan FY 2009-2013
-----------------------------------------------------------------------------------------------------------------
Planned Total # Planned
FY Buildings Total Planned Land Total Acres Disposals
Total # GSF Parcels Total #
----------------------------------------------------------------------------------------------------------------
2009 139 2,109,466 7 175.46 146
----------------------------------------------------------------------------------------------------------------
2010 78 765,853 2 66.00 80
----------------------------------------------------------------------------------------------------------------
2011 111 1,678,038 1 60.00 112
----------------------------------------------------------------------------------------------------------------
2012 55 827,293 1 12.00 56
----------------------------------------------------------------------------------------------------------------
2013 31 1,765,091 0 0 31
----------------------------------------------------------------------------------------------------------------
Total: 414 7,145,741 11 313.46 425
----------------------------------------------------------------------------------------------------------------
Question 3(a): Since the release of the May 2004 CARES report, has
VA delivered on the CARES promise? Which decisions has VA implemented
and which have yet to be implemented? What are the reasons for the
delay in moving forward with the decisions which have not been
implemented, to date?
Response: VA has made significant progress since 2004 and continues
to plan for health care delivery improvements. Since the publication of
the Capital Asset Realignment for Enhanced Services (CARES) Decision
document in 2004, VA has increased access to primary care, decreased
the amount of excess space, and increased the number of special
disability programs for veterans. CARES decisions have been delayed for
the purposes of additional study and as limited resources have required
the prioritization of projects based on service delivery goals.
Further information on the status of individual CARES decisions
will be provided in the CARES Implementation Monitoring Report, which
is pending release.
Question 3(b): Which CARES decisions has VA changed course on? What
are the reasons for this reversal?
Response: CARES identified capital and program requirements at a
macro level using health care demand projections for services such as
inpatient medicine, surgery and psychiatry, and outpatient primary
care, mental health, and specialty care. As analyses of the decisions
continued from an operational perspective using updated data, some
CARES decisions changed based on feasibility and access improvements
where the need was greatest. Further information on the status of
individual CARES decisions will be provided in the CARES Implementation
Monitoring Report.
Question 4: The prolonged implementation process leads to a great
deal of uncertainty about the future of the facility so that it leads
to staff retention issues and, more importantly, leaves our veterans
without access to a health care facility. What is your response to
these concerns? What steps is VA taking to ensure timely construction
of VA medical facilities?
Response: Once major construction projects are approved for design,
VA is committed to fully funding to completion. There are various
reasons the construction appears and realistically is delayed:
The design phase takes approximately 18 to 24 months;
therefore, the construction funds typically follow 2 years after the
design year.
Based on the complexity of the construction and
associated equipment, contractors may require the project to be broken
into phases, with each phase being funded in annual increments.
It is expected that the phases listed in VA's major
construction budget submission be awarded by year's end. This requires
only those buildings and structures that can be obligated by September
2009 be included, which is why we have projects that only construct the
energy center and/or parking garage.
It is VA's intent to fully fund all major construction projects as
quickly as possible to ensure the most economical cost for each
project.
Question 5: How much did VA spend to develop the CARES report? At
the time of the CARES report, did VA estimate the funding needed to
fully implement each of the capital planning decisions for inpatient
and outpatient care? How much has VA spent, to date, on the
implementation of the CARES decision? What additional funding is needed
to complete the implementation of the CARES decision?
Response: VA engaged in six contracts to assist the agency in
developing the CARES process and report. The total cost of these
contracts was approximately $18 million. The additional costs of staff
resources spent on CARES were not tracked; therefore a total of VA
resources spent to develop the CARES report are not available.
In the 2004 CARES Decision document, it was estimated that
implementing CARES decisions would require an additional investment of
approximately $1 billion per year for at least the next 5 years.
Through FY 2008, VA has obligated approximately $2.4 billion on
implementing construction projects identified in the 2004 CARES
Decision document and in 17 business plan study decisions. An estimate
for additional funding needed to complete the implementation of these
decisions is approximately $3 billion.
Question 6: VA's testimony states that ``the tools and techniques
acquired through CARES'' have been integrated into VA's standard
operating procedure with regard to strategic planning. How has this
process changed from before CARES?
Response: Through the CARES process, VA adapted its actuarial model
to produce 20-year forecasts of the demand for veteran health care
services. Ongoing updates allow for more accurate projections of
veteran reliance on VA services. The data from the model is used to
identify gaps between current and projected demand in services within
each market using the health care planning model (HCPM) implemented as
part of the 2008 VHA strategic planning guidance cycle. The 10-step
HCPM planning model facilitates the planning of strategic initiatives
to address the projected gaps. The initiatives include contracting for
services, facility expansions, Department of Defense (DoD)
collaboration, and other initiatives developed as a result of the CARES
process.
As part of the annual VHA strategic planning guidance cycle, a
methodology was developed to identify strategic locations for CBOCs and
other health care delivery approaches across the system. The
methodology evaluates the convergence of low access (measured by drive
time guidelines for primary care services as established by the CARES
process) and increasing projected demand for primary care and mental
health services. The methodology guides the initial step in the CBOC
approval process and/or in planning for the provision of health care
through other solutions.
Question 7: VA's testimony stresses the importance of ensuring that
VA facilities are adaptable so that they may seamlessly accommodate the
development of new clinical practices and technology. Can you elaborate
on how VA ensures that its facilities meet standards of flexibility?
Response: Although health care facilities are inherently more
complex and less adaptable than other building types such as office
buildings, VA makes every effort to plan for the inevitable change that
occurs due to new advances in health care, technology, and changes in
patient populations that occur over the life of a VA medical facility.
VA has instituted a rigorous focus on the planning phase of new
projects, so that projected change and growth over the next 20 years is
accounted for at the beginning. This planning reviews the requirements
for accommodating the changes in functional space use within the
building as well as land for expansion so that its new facilities can
accommodate future needs.
VA's design and construction specifications require that mechanical
systems, equipment rooms, component arrangements, and pipe and ducts be
sized for change and to accommodate future growth. Where possible, VA
incorporates the VA hospital building system, which provides for
greater flexibility by modular design with accessible interstitial
mechanical space in a level above occupied space for distribution of
engineering services, allowing maintenance, repair, and mechanical
system changes to be made without disrupting activities on the occupied
floor below.
The Honorable Joe Donnelly
Question 1: Dr. Lisa Thomas, I am a firm believer in optimizing
health care and making sure that veterans get the most accessible,
highest-quality care we can give them with the resources with which we
are entrusted. Accessibility to specialty care is an issue of
particular concern to my district and to many districts nationwide. For
example, St. Joseph County in my district has a population of more than
a quarter million people, yet area veterans must too often drive more
than 2 hours each way to get to the nearest VA hospital for specialty
care. While there is an excellent outpatient clinic in South Bend, it
is unable to provide many needed services. I am very pleased that the
VA will open a new expanded health center in South Bend for outpatient
and specialty care in 2012. The authorized facility will be 60-70,000
square feet and more than 10 times bigger than our current CBOC. The
outpatient facility will provide comprehensive examination services in
cardiology, podiatry, outpatient surgery and other medical specialties,
wellness programs and ultrasound exams. Special services will also be
available for newly returning veterans from Iraq and Afghanistan.
Further, VA will contract with local hospitals in the South Bend area
to provide inpatient services for area veterans. I would like to know
if the arrangement announced for South Bend might be a model that
constitutes future health care that the VA plans to expand on as it
looks in the near and long-term for opportunities to provide enhanced
quality care and greater access to veterans?
Response: VA has a comprehensive strategic planning process for
actively identifying and appropriately planning for the full continuum
of veteran health care needs. The expanded health care center in South
Bend is just one example of VA initiatives that enhance the quality of
and access to health care for veterans.