[Senate Hearing 112-95]
[From the U.S. Government Publishing Office]


 
                    THE FISCAL YEAR 2012 BUDGET FOR 
                           VETERANS' PROGRAMS 

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

                                HEARING

                               BEFORE THE

                     COMMITTEE ON VETERANS' AFFAIRS
                          UNITED STATES SENATE

                      ONE HUNDRED TWELFTH CONGRESS

                             FIRST SESSION

                             together with

             ADDITIONAL STATEMENTS SUBMITTED FOR THE RECORD


                             MARCH 2, 2011

                               ----------                              

       Printed for the use of the Committee on Veterans' Affairs



















           THE FISCAL YEAR 2012 BUDGET FOR VETERANS' PROGRAMS





























                                                         S. Hrg. 112-95

                    THE FISCAL YEAR 2012 BUDGET FOR 
                           VETERANS' PROGRAMS

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

                                HEARING

                               BEFORE THE

                     COMMITTEE ON VETERANS' AFFAIRS
                          UNITED STATES SENATE

                      ONE HUNDRED TWELFTH CONGRESS

                             FIRST SESSION

                               __________

                             MARCH 2, 2011

                               __________

       Printed for the use of the Committee on Veterans' Affairs


        Available via the World Wide Web: http://www.fdsys.gov/

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                     COMMITTEE ON VETERANS' AFFAIRS

                   Patty Murray, Washington, Chairman
John D. Rockefeller IV, West         Richard Burr, North Carolina, 
    Virginia                             Ranking Member
Daniel K. Akaka, Hawaii              Johnny Isakson, Georgia
Bernard Sanders, (I) Vermont         Roger F. Wicker, Mississippi
Sherrod Brown, Ohio                  Mike Johanns, Nebraska
Jim Webb, Virginia                   Scott P. Brown, Massachusetts
Jon Tester, Montana                  Jerry Moran, Kansas
Mark Begich, Alaska                  John Boozman, Arkansas
                       Kim Lipsky, Staff Director
                 Lupe Wissel, Republican Staff Director





































                            C O N T E N T S

                              ----------                              

                             March 2, 2011
                                SENATORS

                                                                   Page
Murray, Hon. Patty, Chairman, U.S. Senator from Washington.......     1
    Prepared statement...........................................     3
Burr, Hon. Richard, Ranking Member, U.S. Senator from North 
  Carolina.......................................................     4
    Prepared statement...........................................     6
Brown, Hon. Sherrod, U.S. Senator from Ohio......................     8
Johanns, Hon. Mike, U.S. Senator from Nebraska...................     9
Sanders, Hon. Bernard, U.S. Senator from Vermont.................    10
Brown, Hon. Scott P., U.S. Senator from Massachusetts............    12
Rockefeller, Hon. John D., IV, U.S. Senator from West Virginia...   390
Boozman, Hon. John, U.S. Senator from Arkansas...................   393

                               WITNESSES

Shinseki, Hon. Eric K., Secretary of U.S. Department of Veterans 
  Affairs; accompanied by Hon. Robert A. Petzel, M.D., Under 
  Secretary for Health; Michael Walcoff, Acting Under Secretary 
  for Benefits; Steve L. Muro, Acting Under Secretary for 
  Memorial Affairs; Hon. Roger W. Baker, Assistant Secretary for 
  Information and Technology; W. Todd Grams, Acting Assistant 
  Secretary for Management.......................................    13
    Prepared statement...........................................    16
    Response to prehearing questions submitted by Hon. Patty 
      Murray.....................................................    26
    Response to posthearing questions submitted by:
      Hon. Patty Murray..........................................    43
      Hon. Richard Burr..........................................   175
        Follow-up questions to posthearing responses.............   377
      Hon. Mark Begich...........................................   381
      Hon. Mike Johanns..........................................   383
      Hon. Scott P. Brown........................................   384
    Response to request arising during the hearing by Hon. Patty 
      Murray...................................................395, 400

                   Independent Budget Representatives

Blake, Carl, National Legislative Director, Paralyzed Veterans of 
  America........................................................   401
    Prepared statement...........................................   403
Violante, Joe, National Legislative Director, Disabled American 
  Veterans.......................................................   406
    Prepared statement...........................................   407
Roof, Christina, National Acting Legislative Director, AMVETS....   414
    Prepared statement...........................................   416
Kelley, Ray, National Legislative Director for Veterans of 
  Foreign Wars...................................................   422
    Prepared statement...........................................   423

                            Other Witnesses

Tetz, Tim, Director, National Legislative Commission, The 
  American Legion................................................   436
    Prepared statement...........................................   437
Hooker, Maryann D., M.D., Lead Neurologist, Wilmington, Delaware, 
  VA medical center; and Secretary, American Federation of 
  Government Employees Local 342, AFL-CIO........................   442
    Prepared statement...........................................   444
        Additional information submitted.........................   447


           THE FISCAL YEAR 2012 BUDGET FOR VETERANS' PROGRAMS

                              ----------                              


                        WEDNESDAY, MARCH 2, 2011

                                       U.S. Senate,
                            Committee on Veterans' Affairs,
                                                    Washington, DC.
    The Committee met, pursuant to notice, at 10:33 a.m., in 
room 418, Russell Senate Office Building, Hon. Patty Murray, 
Chairman of the Committee, presiding.
    Present: Senators Murray, Rockefeller, Brown from Ohio, 
Sanders, Burr, Johanns, Brown from Massachusetts, and Boozman.

       OPENING STATEMENT OF HON. PATTY MURRAY, CHAIRMAN, 
                  U.S. SENATOR FROM WASHINGTON

    Chairman Murray. Good morning. This hearing will come to 
order. Thank you all for joining us here today.
    This morning our Committee is going to begin our work on 
the VA's 2012 budget. I am very delighted to be here with 
Senator Burr, the Ranking Member. I look forward to working 
with you on this Committee.
    Before we begin, I want to first recognize and thank 
Senator Akaka, who ran this Committee so well for the last 4 
years. I appreciate his tremendous service. As all of us on 
this Committee know those 4 years were filled with a lot of 
major accomplishments for our Nation's veterans.
    I would be really remiss if I did not mention one 
accomplishment that Senator Akaka led the way on, which takes 
on great meaning right now as the Senate and House feud over 
current fiscal year spending. Through Senator Akaka's efforts, 
VA spending for health care is now appropriated one year in 
advance, protecting it from an imperfect budget process that is 
so often affected by politics. I want to say that we are all 
thankful for Senator Akaka's efforts, particularly those who 
have been given peace of mind that because of advance 
appropriations the VA health care system is on track.
    I am so pleased today to begin my work as Chairman of this 
Committee, which is about truly working for all of our Nation's 
veterans. Throughout my life, whether it was watching my own 
dad, who was a Purple Heart recipient, who raised a family of 
seven despite being wheelchair bound, or whether it was in 
college as an intern helping to care for wounded Vietnam 
veterans even younger than me, or in my 16 years as a Member of 
this Committee, I have time and time again been awed and 
astounded by the spirit, the determination, and the 
perseverance of our veterans.
    I have also gained a keen, personal understanding of the 
consequences of sending our servicemembers into combat and of 
the sacred obligation we have to care for those who are injured 
in service.
    With that in mind, I am delighted to take on this 
tremendous responsibility and look forward to working with all 
of you on the budget and on all other issues affecting 
veterans.
    At the outset, let me say that on balance, and given that 
other agencies are facing budget cuts, this VA budget is a very 
good starting place from which to work. The President has 
requested an overall increase of $5.9 billion in discretionary 
spending over Fiscal Year 2011 levels. While health care 
spending is in good shape, there are some weaker points in the 
budget.
    For example, the proposed cuts in spending for construction 
and non-recurring maintenance are very troubling. The budget 
documents lay out VA's vision for a 10-year construction plan, 
but what is missing in this budget is detail on how to close 
that gap between the funding we need to bring facilities up to 
date and the funding requested of the Congress.
    I also want to call attention to the proposed $70 million 
cut for VA research funding. I am very worried that such a cut 
would imperil some critical projects and shove physician 
researchers out the door.
    Topping anyone's list of problems the VA is facing is how 
disability benefits claims are processed. The claims backlog 
has gone on too long, and addressing it will be a top priority 
for the Committee and the Congress.
    As we continue to work on this, some things do need to be 
acknowledged. More veterans are filing claims and more are 
filing increasingly complex claims. There is nothing that can 
be done to change that reality. That said, we need to really 
focus our attention on solutions, including viable IT support 
if we are to reach the shared goal of timely, accurate 
decisions on benefits claims. I expect to hear from VA, in 
detail, what exactly its plan is to transform this broken 
system.
    I am also concerned that VA may not have adequately 
addressed the need for sufficient resources for administering 
the GI Bill education benefits. In light of a substantial 
increase in the workload and in the number of new students, the 
budget would reduce full-time employees, or FTE.
    On the positive side, the proposed budget reflects the VA's 
very real commitment to end homelessness. I am encouraged to 
see that the Administration has increased funding for homeless 
programs. I am hopeful that we will continue to see significant 
effort to reduce the number of homeless veterans and prevent 
those at risk from becoming homeless.
    Likewise, I am pleased that the budget reflects the 
Administration's continuing effort to make sure that gender-
specific care for women is readily available throughout the 
system.
    I would also note that I am as committed today as I was 
during my early years on the Committee to the belief that the 
Government can be fiscally responsible while still fulfilling 
its commitments to the most deserving among us, including, of 
course, our Nation's veterans.
    This budget request includes a series of cost-saving 
initiatives, including better controls on contract health care, 
better strategies for contracting, and cutting administrative 
overhead, all of which I will review with an open mind.
    But we must always remember that like all budgets, the VA 
budget is a reflection of our values, and that each of those 
values has a direct impact on the lives of thousands, if not 
millions, of our veterans.
    Last week, I sat down with veterans from across my 
homestate and heard from the very men and women whose lives 
this budget will touch. I heard from a Vietnam veteran with 
PTSD whose son, a National Guard soldier, just recently 
committed suicide after returning from the battlefield with 
PTSD.
    I heard from a female Iraq veteran who told me when she 
calls the VA she continually gets asked if she is calling for 
her husband. I heard from veterans about the claims backlog, 
barriers to employment, access to care, holes in the education 
benefit, and a lot more.
    We have work to do for these veterans, and work that begins 
today. It begins with this budget. I look forward to working 
with my colleagues on this Committee.
    We have a number of new Members, who I am delighted to see 
join us on this Committee. I will continue to work on the 
Budget and Appropriations Committees on which I also sit, and, 
of course with you, Secretary Shinseki, all your team, and the 
leaders from the veterans community.
    With that, I will turn it over to the Ranking Member, 
Senator Burr.
    [The prepared statement of Chairman Murray follows:]
          Prepared Statement of Hon. Patty Murray, Chairman, 
                      U.S. Senator from Washington
    This morning, the Committee begins work on VA's 2012 budget. Before 
we begin, I want to first thank Senator Akaka who led this Committee so 
well over the last four years. As all of us on this Committee know, 
those four years were filled with many major accomplishments for our 
Nation's veterans. But I would be remiss if I didn't mention one 
accomplishment that Senator Akaka led the way on that takes on great 
meaning right now--as the Senate and the House feud over spending for 
the current fiscal year. Through Senator Akaka's efforts, VA spending 
for health care is now appropriated a year in advance--protecting it 
from an imperfect budget process that is so often affected by politics. 
We are all thankful for Senator Akaka's work--particularly all those 
who have been given peace of mind that through advance appropriations 
the VA health care system is on track.
    I am so pleased today to begin my work as Chairman of this vital 
Committee, on behalf of all American veterans. Throughout my life, 
whether it was watching my father, a purple-heart recipient, raise a 
family of seven despite being wheelchair bound, or whether it was in 
college as an intern helping to care for wounded Vietnam veterans even 
younger than me, or in my 16 years as a Member of this Committee, I 
have time and again been awed and astounded by the spirit, 
determination, and perseverance of our veterans.
    I have also gained a keen, personal understanding of the 
consequences of sending our servicemembers into combat and of the 
sacred obligation we have to care for those injured in service. With 
that in mind, I am delighted to take on this tremendous responsibility 
and look forward to working with all of you in the time to come--on the 
budget and on all other issues affecting veterans.
    At the outset, let me say that on balance, and given that other 
agencies are facing budget cuts, this VA budget is a very good starting 
place from which to work. The President has requested an overall 
increase of $5.9 billion in discretionary spending over Fiscal Year 
2011 levels. While health care spending is in good shape, there are 
some weaker points in the budget. For example, the proposed cuts in 
spending for construction and non-recurring maintenance are very 
troubling.
    The budget documents lay out VA's vision for a ten-year 
construction plan, but what is missing in this budget is detail on how 
to close the gap between the funding we need to bring facilities up to 
date and the funding requested of the Congress. I must also call 
attention to the proposed $70 million cut for VA research funding. I am 
worried that such a cut would imperil some critical projects and shove 
physician researchers out the door.
    Topping anyone's list of problems the VA is facing is how 
disability benefits claims are processed. The claims backlog has gone 
on too long and addressing it will be a top priority for the Committee 
and the Congress. As we continue to work on this, some things must be 
acknowledged: more veterans are filing claims and more are filing 
increasingly complex claims. There is nothing that can be done to 
change that reality. That said, we need to really focus our attention 
on solutions--including viable IT support--if we are to reach the 
shared goal of timely, accurate decisions on benefits claims. I expect 
to hear from VA, in detail, what exactly its plan is to transform this 
broken system.
    I am also concerned that VA may not have adequately addressed the 
need for sufficient resources for administering GI Bill education 
benefits. In light of a substantial increase in the workload and in the 
number of new students, the budget would reduce FTE.
    On the positive side, the proposed budget reflects the VA's very 
real commitment to end homelessness. I am encouraged to see that the 
Administration has increased funding for homeless programs and am 
hopeful that we will continue to see significant effort to reduce the 
number of homeless veterans and prevent those ``at risk'' from becoming 
homeless. Likewise, I am pleased that the budget reflects the 
Administration's continuing effort to ensure that gender-specific care 
for women is readily available throughout the system.
    I would also note that I am as committed today, as I was during my 
early years on the VA Committee, to the belief that the Government can 
be fiscally responsible while still fulfilling its commitments to the 
most deserving among us, including, of course, our Nation's veterans. 
This budget request includes a series of cost-saving initiatives, 
including better controls on contract health care, better strategies 
for contracting, and cutting administrative overhead, all of which I 
will review with an open mind. But we must always remember that like 
all budgets, the VA budget is a reflection of our values. And that each 
of those values has a direct impact on the lives of thousands, if not 
millions of our veterans.
    Last week, I sat down with veterans from across my home state and 
heard from the very men and women whose lives this budget will touch. I 
heard from a Vietnam veteran with PTSD whose son--a National Guard 
member--just recently committed suicide after returning from the 
battlefield with PTSD. I heard from a female Iraq veteran who told me 
that when she calls the VA she continually gets asked if she's calling 
for her husband. I heard from veterans about the claims backlog, 
barriers to employment, access to care, holes in the education benefit, 
and much, much more.
    We have work to do for these veterans, work that begins today, work 
that begins with this budget. I look forward to working with my 
colleagues on this Committee, and on the Budget and Appropriations 
Committees on which I also sit, and of course, Secretary Shinseki, his 
team, and the leaders from the veterans' community.

        STATEMENT OF HON. RICHARD BURR, RANKING MEMBER, 
                U.S. SENATOR FROM NORTH CAROLINA

    Senator Burr. Thank you, Madam Chairman. Good morning and 
more importantly congratulations on your new role. As I realize 
and most in the room probably do, this is an historic day. 
Senator Murray is the first female to chair the VA Committee.
    Chairman Murray. I'm the only female on this Committee, so 
I have a world on my shoulders.
    Senator Burr. Affirmative action works.
    Chairman Murray. I wrote that down.
    [Laughter.]
    Senator Burr. I do congratulate you on not only your 
leading the Committee but your fine work in the United States 
and for the American people.
    Mr. Secretary, welcome to you and your team of 
professionals. More importantly, thank you for the work and the 
effort that you and your professional staff put into the care 
of our Nation's veterans.
    We are grateful to the veterans' service organizations and 
the American Federation of Government Employees. We welcome 
you, as well, as part of this hearing.
    I think we will run into a little glitch on votes today at 
11 o'clock, but we will try to deal with them as smoothly and 
as quickly as we can.
    Of course, we are here today to talk about the President's 
2012 budget. In a time of record high debt and deficits, my 
priority is not only to ensure that veterans of every 
generation receive the care and benefits that they need and 
deserve, but also to analyze every area of the budget to ensure 
we maximize all options to spend the taxpayer's money wisely.
    As President Obama states in his budget message, ``Even in 
areas outside the freeze, we are looking for ways to save money 
and cut unnecessary costs.''
    The fiscal year 2012 Veterans Affairs budget requests an 11 
percent increase over the 2010 enacted levels in discretionary 
spending. In examining the VA budget request, one observation I 
made is the growth in the budget of the staff offices in your 
DC central office over the last 2 years.
    If this budget were to be approved, both the funding levels 
and the number of staff will have grown at a very high rate 
since 2010. The general administration budget has increased 13 
percent since 2010 and the staff, or FTE's, request for 2012 
reflects a 20 percent increase.
    This large boost in spending led me to look closer at the 
FTE requests of the individual offices within general 
administration. Here is what I found: a 2-year staffing 
increase of 7 percent in the Office of the Secretary; a 2-year 
staffing increase of 34 percent for the Office of Public and 
Intergovernmental Affairs; a 2-year staffing increase of 44 
percent for the Office of Congressional and Legislative 
Affairs.
    Other examples of spending we may want to take a closer 
look at include: VA continuing to operate and publish a law 
review that has articles and book reviews; and the hiring of a 
speech writer for the Assistant Secretary.
    How are these funding increases essential to our Nation's 
veterans? That is a questions we should ask. Do these 
additional staff directly benefit the veterans who use the VA 
system?
    Another item I found very interesting is the $1 billion 
contingency fund in the Medical Services account, which would 
essentially provide a buffer in case poor economic conditions 
were to drive up the demand for VA services.
    The Secretary and I talked about that earlier this week. It 
caught my eye because the first line of the President's Budget 
message says this, ``America is emerging from the worst 
recession in generations. In 2010, an economy that had been 
shrinking began to grow again.''
    Now, what I find interesting is the seeming difference of 
opinion of the strength of the economy between the President 
and those who forecasted the budget, and the need for a 
contingency fund. I have been assured by the Secretary that the 
contingency fund is designed for the delivery of health care, 
and I think as long as we stay within those parameters, we are 
all comfortable.
    The Medical Care Collections Fund, or MCCF, is of 
particular interest to me. Recently, VA's Chief Business 
Officer informed my staff that the VA was downgrading from what 
it was expecting to collect in 2012 from $3.1 to $2.8 billion.
    I am interested to learn more about this sudden change in 
the collections forecast and the actuarial model that was used 
to calculate it. I am also interested to know whether we are 
collecting everything the VA is owed under MCCF.
    When my staff asked VA what percentage of available money 
is being collected, the Chief Business Officer could not give 
them a definitive answer. While VA has done an excellent job in 
recent years collecting what it forecasts, is there money being 
left on the table?
    Another concern is the claims backlog which Senator Murray 
has raised in her opening statement and has been a continual 
topic of conversation. Veterans from North Carolina and across 
the country cannot wait so long for decisions that too often 
are wrong.
    For years, the primary response to these problems has been 
to add more staff. In fact, since 2001, claims processing staff 
has more than doubled. But the problems of large backlogs and 
long delays continue. They are expected to get even worse.
    Although I appreciate that the VA is now focusing on IT 
improvements and other initiatives rather than simply adding 
more staff, new ideas and good intentions are not enough. We 
must make sure VA has the tools and resources it needs to 
succeed in these efforts.
    More importantly, we must make sure there is a realistic, 
comprehensive plan to get the backlogs under control so 
veterans and their families will not face delays or 
frustrations in accessing their VA benefits. I look forward to 
a productive discussion today about whether this budget would 
bring us closer to that reality.
    In the end, we need to ask ourselves if spending money on 
bureaucrats, speech writers, and publishing book reviews are 
consistent with being good stewards of the taxpayer's money in 
providing benefits to veterans. More importantly, we should ask 
ourselves if we are fulfilling President Lincoln's promise: 
``To care for him who shall have borne the battle, and for his 
widow, and his orphan.''
    Mr. Secretary, welcome.
    Madam Chairman, I thank you.
    [The prepared statement of Senator Burr follows:]
       Prepared Statement of Hon. Richard Burr, Ranking Member, 
                    U.S. Senator from North Carolina
    Good morning, Madam Chairman. Congratulations on your new position 
as Chairman of this Committee. I look forward to working with you and 
with all of our members in improving the lives of our Nation's 
veterans, their families, and their survivors.
    Secretary Shinseki, welcome to you and your senior leadership team. 
And welcome to the representatives of the Veterans Service 
Organizations and the American Federation of Government Employees.
    We are here today to review the President's budget request for the 
Department of Veterans Affairs for fiscal year 2012.
    In a time of record high debt and deficits, my priority is not only 
to ensure that veterans of every generation receive the care and 
benefits they need and deserve but also to analyze every area of the 
budget to ensure we maximize all options to spend the taxpayer's money 
wisely. As President Obama states in his Budget Message, ``Even in 
areas outside the freeze, we are looking for ways to save money and cut 
unnecessary costs.''
    The fiscal year 2012 Veterans Affairs budget requests an 11% 
increase over the 2010 enacted level in discretionary spending.
    In examining the VA budget request, one observation I have is the 
growth over the last 2 years in the budget of the staff offices in your 
D.C. central office. If this budget were to be approved, both the 
funding levels and the number of staff will have grown at a very high 
rate since 2010. The general administration budget has increased 13% 
since 2010 and the staff--or FTE's--request for 2012 reflects a 20% 
increase.
    This large boost in spending led me to take a closer look at the 
FTE requests of the individual offices within general administration. 
Here is what I found:

     A two-year staffing increase of 7% for the Office of the 
Secretary;
     A two-year staffing increase of 34% for the Office of 
Public and Intergovernmental Affairs; and
     A two-year staffing increase of 44% for the Office of 
Congressional and Legislative Affairs.

    Other examples of spending we may want to take a closer look at 
include: VA continuing to operate and publish a law review that has 
articles and book reviews and the hiring of a speech writer for an 
Assistant Secretary.
    How are these funding increases essential to our Nation's veterans? 
Do these additional staff directly benefit the veterans who use the VA 
system?
    Another item I found very interesting is the $1 billion contingency 
fund in the Medical Services account, which would essentially provide a 
buffer in case poor economic conditions drive up demand for VA 
services. This caught my eye because of the first lines of the 
President's Budget Message: ``America is emerging from the worst 
recession in generations. In 2010, an economy that had been shrinking 
began to grow again.'' What I find interesting is the seemingly 
difference of opinion on the strength of the economy between the 
President and VA.
    The Medical Care Collections Fund--or MCCF--is of particular 
interest to me. Recently, VA's Chief Business Officer informed my staff 
VA was downgrading what it was expecting to collect in 2012 from $3.1 
billion to $2.8 billion. I am interested to learn more about this 
sudden change in the collections forecast and the actuarial model being 
used.
    I am also interested to know whether we are collecting everything 
VA is owed under MCCF. When my staff asked VA what percentage of 
available money is being collected, the Chief Business Officer could 
not give them a definitive answer. While VA has done an excellent job 
in recent years collecting what it forecasts, is there money being left 
on the table?
    Another concern is the claims backlog. Veterans from North Carolina 
and across the country can wait far too long for decisions that too 
often are wrong. For years, the primary response to these problems has 
been to add more staff. In fact, since 2001, claims processing staff 
has more than doubled. But the problems of large backlogs and long 
delays continue. And they are expected to get even worse next year.
    Although I appreciate that VA is now focusing on IT improvements 
and other initiatives--rather than simply adding more staff--new ideas 
and good intentions are not enough. We must make sure VA has the tools 
and resources it needs to succeed in these efforts. More importantly, 
we must make sure there is a realistic, comprehensive plan to get the 
backlog under control, so veterans and their families will not face 
delays or frustrations in accessing their VA benefits. I look forward 
to a productive discussion today about whether this budget would bring 
us closer to that reality.
    In the end, we need to ask ourselves if spending money on 
bureaucrats, speech writers, and publishing book reviews are consistent 
with being good stewards of the taxpayer's money. More importantly, we 
should ask ourselves if we are fulfilling President Lincoln's promise: 
``To care for him who shall have borne the battle, and for his widow, 
and his orphan.''

    Thank you Madam Chairman, I yield back.

    Chairman Murray. Thank you very much.
    We will now turn to our other Senators for opening 
statements.
    Senator Brown.

               STATEMENT OF HON. SHERROD BROWN, 
                     U.S. SENATOR FROM OHIO

    Senator Brown of Ohio. Thank you, Madam Chair, Senator 
Burr, and Members of the Committee.
    Congratulations, Senator Murray, on your Chairmanship. I 
know how important that is to you. I was watching you before I 
was in the Senate and have worked alongside you since. Your 
concern and empathy while fighting for veterans is impressive.
    Secretary Shinseki, welcome. All members of the panel, 
thank you for stopping by. Mr. Secretary, you are always 
patiently answering questions and advocating for veterans all 
the time.
    We know about the President's Budget. We have talked about 
that among us and with the panelists separately in many cases.
    I wanted to look at it in a slightly different way, which 
is to consider how potential cuts to other agencies and 
programs will affect veterans and whether these cuts will lead 
to a higher proportion of veterans turning to the VA for 
assistance.
    For example, H.R. 1 in the House proposes devastating cuts 
to the workforce investment programs in Ohio and other places. 
There are 95 one-stops in Ohio and 3,000 nationwide. Many, if 
not all of them, will have to close their doors if the proposed 
$3.8 billion in cuts to workforce investment pass Congress.
    Senator Murray has been very involved in that issue from 
her position on the Health, Education, Labor, and Pension 
Committee. We need to work through how those kinds of cuts 
would affect veteran services at the same time.
    The Veterans' Workforce Investment Program is funded 
through WIA (Workforce Investment Act). Will those proposed 
cuts impact this program? It is estimated that veterans will 
increasingly turn to the VA, to VA's contingency fund. Will 
advanced appropriation requests reflect this prediction?
    I am pleased to see the VA has incorporated a contingency 
fund for medical care for 2012 in its advance appropriations 
for 2013. This will help Congress and the VA to more accurately 
plan for the VA's future and continue to improve care and 
services.
    Secretary Shinseki, I applaud you for taking on three of 
the VA's most pressing issues: the claims backlog, as Senators 
Murray and Burr mentioned; veteran homelessness; and expanding 
access to VA health care and benefits. You have done 
outstanding work in my State, especially in Chillicothe and 
southern Ohio, and I trust that your efforts will bear fruit.
    Like many of my colleagues, I have concerns obviously 
regarding the backlog. Over the past several years, Congress 
has provided the resources to hire nearly 4,000 additional 
adjudicators to address the backlog, yet as of January 31 of 
this year, pending claims had increased over last year's level. 
And, that is not including new Agent Orange claims for the 
three new presumptive conditions established in 2010: ischemic 
heart disease; B-cell leukemia; and Parkinson's.
    Not only is the backlog continuing to grow, but the 
accuracy of claims is approximately 80 percent and the Board of 
Veterans' Appeals expects a 63-percent increase in case 
receipts over a 4-year period.
    In a minute or two I will share a letter. On June 2010, a 
Navy veteran from Hamilton, OH, near Cincinnati, wrote my 
office for assistance with his VA claim. He was exposed to 
radiation during his service. He developed thyroid cancer.
    His initial VA claim was filed in 2005. It was denied. It 
was not until his Notice of Disagreement was upheld that his 
case actually made it to the VBA. They remanded the case for 
dose reconstruction. It was sent to Nashville, and then sent 
back to the Appeals management center, and then the appeals 
management center sent it to the VA regional office in 
Cleveland, citing lack of jurisdiction.
    This veteran from southern Ohio, his dose reconstruction is 
yet to be constructed. His claim will still have to go back to 
the VBA once it is determined. It has been 5 years since he 
started the process.
    In addition, Mr. Secretary, we need to address the 
disparity in disability compensation, and we have not gotten 
any real understanding of why this is. Ohio is consistently at 
the bottom of benefit ratings. There is no reason that a bum 
knee in Lima, OH, should not be worth the same as a bum knee in 
San Diego, CA. I hope the panelists can discuss how this year's 
budget will fix that.
    The last point, Madam Chair: I am concerned with the 
President's Budgets request for VA major and minor 
construction. The request is $757 million less than fiscal year 
2011, approximately $1.65 billion less than the amount proposed 
by the VSOs' Independent Budget. VA has a $24 billion 
construction backlog. We know that. We need to pay attention to 
that too.
    I appreciate your service. Thank you, Madam Chair.
    Chairman Murray. Thank you very much.
    Senator Johanns.

                STATEMENT OF HON. MIKE JOHANNS, 
                    U.S. SENATOR FROM NEVADA

    Senator Johanns. Madam Chairman, congratulations to you. It 
is a pleasure for me to be back on what I consider to be one of 
the Senate's most important Committees.
    As I was thinking about my opening statement today, which I 
promise will be very brief, Mr. Secretary, it occurred to me 
that in your mission area, the Federal Government has asked you 
and your team to manage an enormous health care system, a very 
complicated one I might add; run a disability benefit programs, 
again, very, very complex; a home loan program; an insurance 
program; an education assistance program; and the largest 
national cemetery system in the entire Nation. You see my 
point. I could go on and on.
    This is an area where through various decisions made by 
policymakers we have asked the Veterans' Administration to 
strap on yet another agenda item and another agenda item, which 
is quite easy to do over time. The challenge you and your team 
face is how to deliver all of these services in an efficient, 
prompt way while dealing with the budget constraints that we 
all face.
    Now, I am going to offer a positive comment or two. I think 
you and your team probably deserve the award for the folks that 
are the most accessible to me. I have never had a situation 
where I needed to see somebody, including you, Mr. Secretary, 
that I had to even wait. Typically, it was my schedule that we 
were working around to schedule that kind of meeting, and I 
appreciate that.
    Second, as a very new member, it was my first year here, I 
asked if we could do a field hearing back home in Nebraska, and 
that was arranged. It was an excellent hearing. We got out 
information that I thought was very important. Again, the 
response was just so positive from your office.
    The challenge we face, however, is there are still many 
things that need to be done, and we are also mindful of the 
budget issues that we face.
    So, in today's hearing I hope we really concentrate on what 
progress has been made with the resources you have been given, 
why those are important, and how we might think about 
alternatives, whether it is a different approach or whatever, 
that we might try to be more efficient.
    I think at the end of the day, no matter which side of the 
table we sit on here, we want to deliver excellent service to 
our veterans and to families that need those services.
    Sometimes those services are very extensive, as you know. 
We are bringing people back home that have suffered enormous 
injuries. Trying to do all we can to help can cost in so many 
ways, and the burden is on you folks to try to make that work.
    Well, let me just wrap up and say as somebody who has been 
a mayor and a Governor and had to struggle with budgets, coming 
from a State where we do not borrow money--we balance the State 
budget without borrowing money, doing it in a way where 
literally we have to make cuts sometimes--we have to deal with 
the reality of providing services without going to the credit 
card.
    I just think that all of us in the Federal Government need 
to be mindful that our credit card is getting maxed-out, and we 
have got to figure out how we do these things in an efficient 
way.
    So, I am going to be looking to you and pressing you on how 
we can deliver these services to the these wonderful people, 
our veterans, and do it in the most cost-efficient way we can. 
Thank you.
    Chairman Murray. Thank you very much.
    Senator Sanders.

              STATEMENT OF HON. BERNARD SANDERS, 
                   U.S. SENATOR FROM VERMONT

    Senator Sanders. Thank you very much, Madam Chairman. Let 
me just pick up on what Senator Johanns said and applaud you, 
Mr. Secretary, and your staff. I talked to a lot of veterans in 
the State of Vermont, and we talk to veterans' organizations; 
yesterday, I spoke with the DAV.
    I think there is a pretty widespread agreement that we are 
making progress, that a number of years ago the VA had a 
significant set of problems. We still have a long way to go; no 
question about it. But I do think there is an understanding 
that we are making some progress, and I want to thank you for 
your diligence and focus on issue after issue that are of 
concern to so many veterans.
    Now, we know that in terms of health care, we are faced 
with a dual problem. We have older veterans, who we are 
absolutely going to provide the best quality care for. On the 
other hand, we have a lot of young people returning from Iraq 
and Afghanistan with a lot of serious problems. We are going to 
do that, and I applaud you for efforts in that area.
    You have made the point when you came before this Committee 
that it is a national disgrace that a significant number of the 
people who are homeless in America are veterans. You made that 
point, and you pledged to us that you would address that issue, 
which you are doing.
    I can tell you that in the State of Vermont right now we 
are seeing shelters going up, facilities going up, some of them 
quite beautiful, which are giving our veterans the kind of 
dignity and security that they need. I thank you for that as 
well.
    A problem that everybody on this Committee knows has 
plagued the VA year after year after year is the length of time 
it takes to process disability claims. We have not solved it 
yet, but I know you are working on a number of pilots to try to 
address it, using technology in a way that makes a lot of 
sense, and I applaud you for that as well.
    In Vermont, I am happy to tell you, Mr. Secretary, that we 
have added two new CBOCs, and I believe that the CBOC program 
is one of the jewels of the VA system. The fact that veterans 
do not have to drive long distances to a large hospital to get 
the primary health care they need is a huge benefit to them.
    We have established one in Brattleboro, one in the southern 
part of our State, and one in the Newport area in the northern 
part of our State. I want to tell you that the veterans of the 
State of Vermont are very grateful for that.
    We are making progress improving our main facility in White 
River Junction. We got some money to go in there and improve 
that facility, which we are grateful for, as well.
    I know that you are also focusing on two of the major 
signature problems of our time, and that is PTSD, a very, very 
serious problem, and TBI. How do we address those issues?
    We have thousands and thousands of veterans who are hurting 
from those problems, among others. When we worked on a model 
program in Vermont, you and I talked about that even if you had 
the best facilities in the world providing the best care in the 
world, it does not mean anything unless veterans are able to 
access that care.
    So, how do we do better outreach? How do we make sure every 
veteran, especially those struggling with problems like PTSD 
access those facilities and that care? How do we improve 
outreach efforts?
    So the bottom line, Mr. Secretary: I want to applaud you 
for what you are doing. You are doing a great job, and I look 
forward to continuing to work with you.
    Chairman Murray. Thank you very much.
    Senator Brown.

               STATEMENT OF HON. SCOTT P. BROWN, 
                U.S. SENATOR FROM MASSACHUSETTS

    Senator Brown of Massachusetts. Thank you, Madam Chair, and 
welcome back to the Committee. I look forward to your 
leadership. It is good to be back on the Committee, as well.
    I want to echo what Senator Johanns said, that a lot of 
good is getting to a lot of challenges. I want to hear from you 
more than I want to hear from us.
    I know we are going to be bouncing back and forth to votes, 
but I am very concerned about veterans finding work, the 
homelessness issue, and construction. For example, in 
Massachusetts we have the West Roxbury Hospital of the VA, 
which is basically the northeast region care facility. It is at 
the point now that they cannot even perform modern operations, 
cannot get the equipment in the outdated operating rooms.
    So we are trying to address some of those issues, finding 
out what you need, what resources and help you need.
    As somebody who still serves, you know, obviously I take 
these issues very seriously like every Member of this Committee 
regardless of their service.
    I have found that there are some good citizen groups and 
non-profit organizations that are actually working with the 
soldiers to process claims applications. My understanding is 
that part of the delay and breakdown is the fact that the 
applications are incomplete.
    I have a group in Massachusetts that has had a hundred 
percent success rate when they have submitted their claims, and 
they have a hundred percent return, and I think that is 
important. Maybe having more entities like that throughout the 
country so when you get the claim you see that the packet is 
complete, versus having to send it back. The delay is what is 
really crushing our soldiers and their morale when it comes to 
getting the care and service that they need.
    So, I look forward to your testimony. We will be bouncing 
back and forth, so no disrespect intended. Thank you.
    Chairman Murray. Thank you very much.
    With that, I want to welcome Secretary Eric Shinseki to the 
Committee. I really appreciate your joining us today to give us 
your perspective on the Department's Fiscal Year 2012 Budget. 
We look forward to your testimony.
    Secretary Shinseki is accompanied today by Dr. Robert 
Petzel, Under Secretary for Health. We also have Mike Walcoff, 
Acting Under Secretary for Benefits; Steve L. Muro, Acting 
Under Secretary for Memorial Affairs; Roger W. Baker, Assistant 
Secretary for Information and Technology; and Todd Grams, 
Acting Assistant Secretary for Management.
    Mr. Secretary, your prepared remarks will be, of course, in 
the record but we appreciate your testimony today.

STATEMENT OF HON. ERIC K. SHINSEKI, SECRETARY, U.S. DEPARTMENT 
  OF VETERANS AFFAIRS; ACCOMPANIED BY HON. ROBERT A. PETZEL, 
M.D., UNDER SECRETARY FOR HEALTH; MICHAEL WALCOFF, ACTING UNDER 
 SECRETARY FOR BENEFITS; STEVE L. MURO, ACTING UNDER SECRETARY 
   FOR MEMORIAL AFFAIRS; HONORABLE ROGER W. BAKER, ASSISTANT 
SECRETARY FOR INFORMATION AND TECHNOLOGY; W. TODD GRAMS, ACTING 
               ASSISTANT SECRETARY FOR MANAGEMENT

    Secretary Shinseki. Thank you, Madam Chairman, and I add my 
congratulations to you as well and look forward to working with 
you and your leadership on this Committee. Ranking Member Burr, 
who has since departed, and other distinguished Members of the 
Senate Committee on Veterans' Affairs, thank you again. I say 
that genuinely.
    Thank you again for this opportunity to present the 
President's 2012 budget and 2013 advanced appropriations 
request for this Department.
    This Committee's support of our Nation's veterans has 
always been unequivocal and unwavering. That is my experience 
for 2 years. I wish to express my appreciation to all the 
Members on behalf of the professional workforce that comes to 
work everyday in the VA and the 8.3 million veterans who come 
to us for service.
    Let me also acknowledge the representatives of some of our 
veterans' organizations in attendance today. They provide 
insights into veterans' needs and suggest ways in which VA can 
better address them. Those insights are helpful as we 
deliberate how to best resource our programs.
    Madam Chairman, thank you for recognizing the other members 
of the panel. Let me just point them out so that I get faces 
and names aligned. Roger Baker, IT, is to my extreme left. Todd 
Grams, our Chief Financial Officer, is to my left. The young 
man to my right, Dr. Randy Petzel, is our Chief Medical 
Officer. Mike Walcoff, Benefits; and Steve Muro, who is the 
Acting Under Secretary for Memorial Affairs and the President's 
nominee to be the Under Secretary for the National Cemetery 
Administration.
    Thank you, Madam Chairman, for admitting my written 
statement for the record.
    The VA budget is large and complex and important, to be 
sure, because it cares for those, as several have already 
suggested, who safeguard our Nation so that the rest of us can 
do what Americans do best, and that is out think, out work, out 
create, out produce the rest of the world.
    I say that realizing that the economy has lost some of its 
sparkle at the moment, but I trust the instincts, the energy, 
the intellect, and the ingenuity of Americans to get that back 
and to get us and our economy back on track.
    It has been noted several times that less than 1 percent of 
our citizens serve in the military. But let me just tie 
together the two statements I just made. Those that do, these 
men and women who serve in uniform, enable the rest of the 
Nation to unleash the potential in that economic engine to do 
what Americans have historically done, and that is create the 
best economy in the world and win in this competitive area.
    When those members of the military transition back to their 
communities to add their skills, their knowledge, and their 
experience to that economic engine, VA's mission is pretty 
clear. As Senator Burr cited, our mission goes back to 
President Lincoln's admonition to care for those who have borne 
the battle and for their spouses and orphans.
    To keep that promise, VA is a large integrated health care 
system, the largest in the country. It is also our largest 
national cemetery system, repeatedly recognized as the 
country's top performer in customer satisfaction over the past 
10 years.
    The VA also manages the country's second-largest education 
assistance program. It guarantees nearly 1.4 million individual 
home loans at zero down payment with the lowest foreclosure 
rates in all categories of mortgage loans.
    Finally, it is the country's eighth largest life insurance 
enterprise with a 96 percent customer satisfaction rating.
    I often get asked the question, why is the VA enterprise so 
complex? Why is it so large? And the answer that I usually end 
up giving is fairly simplistic. It is because in times past 
those who wore the Nation's uniforms were often unable to 
either acquire or afford those services elsewhere on their own. 
In honoring their service, it was found important that they not 
be left unattended. For that reason we have this complex series 
of missions.
    Our mission, to provide, or arrange for, the care of 
veterans who need us once the uniforms come off, again, remains 
rooted in President Lincoln's promise of 1865.
    We deliver on the promises of Presidents and fulfill the 
obligations of the American people to those who have borne the 
battle.
    Today the Nation's military remains deployed in two 
different operational theaters, conflicts that have been 
underway for most of the past decade in Afghanistan and Iraq. 
The burden on our magnificent all-volunteer force and their 
families in accomplishing those missions without failure, 
without fanfare, without complaint has been enormous, and they 
have been magnificent.
    VA's requirements have grown over that time as we address 
long-standing issues from past wars and watch the requirements 
for those fighting the current conflicts grow significantly.
    These numbers will continue to rise for years, maybe even 
decades, after the last American combatant departs Afghanistan 
and Iraq. That is the history of what has happened inside VA.
    As a reminder of the duration of those obligations and a 
tribute to his life of service, let me acknowledge the passing 
of Mr. Frank Buckles just this past Sunday at 110 years of age.
    Mr. Buckles was the last known American veteran of World 
War I. Our thoughts and prayers are with his family, and I have 
expressed them as they mourn the loss of this very special 
American more than 92 years after the armistice that ended the 
great war was signed.
    This budget request is the Department's plan for meeting 
those obligations to all generations of our veterans 
effectively, accountably, and efficiently.
    At present, about 8.3 million veterans depend on VA for 
medical care and benefits, but over 22 million veterans and 
another 35 million spouses and adult children see themselves as 
either veterans or part of veterans' families whether or not 
they visit our medical centers or ever apply for benefits.
    They all expect us to get things right for the veterans we 
do serve, and we rely on the leadership, Madam Chairman, your 
leadership and the leadership of this Committee and your 
support in helping us determine how best to serve those 
veterans.
    To resource VA's efforts, the President's Budget request 
would provide $132.2 billion in 2012, $61 billion in 
discretionary resources, about $70.3 billion in mandatory 
funding.
    Our discretionary budget request represents, as the 
Chairman pointed out, a $5.9 billion increase, which is about a 
10.6 percent increase over the 2010 enacted level.
    Since I appeared before this Committee last year, we have 
published and implemented a strategic plan to continue 
transforming VA into an innovative 21st-century organization, 
that is--and these are sort of our tag lines--a people-centric; 
results-driven, if you cannot measure it, you cannot declare 
progress; and forward-looking.
    Our 2012 and 2013 budget plans are based on four goals in 
our strategic plan: first, continue improving the quality and 
accessibility of VA health care benefits and services. Second, 
increase veterans' satisfaction with the care and services we 
provide. Third, raise readiness to continue the provision of 
care and services in a time of crisis. Finally, improve VA's 
internal management systems.
    Achievement of these goals mandates our constant and 
consistent good stewardship of the financial resources 
entrusted to us by this Committee and the Congress.
    Every dollar counts. That is my repeated phrase. Every 
dollar counts always, both in the current constrained fiscal 
environment, but also during less stressful times. Every dollar 
counts.
    We have designed management systems and initiatives to 
maximize the effectiveness and eliminate waste, including VA's 
Project Management Accountability System, PMAS, a new 
acquisition strategy to make more effective use of our IT 
resources.
    VA's Transformation Twenty-One Total Technology, our bumper 
sticker for that is T4. T4 consolidates our IT requirements 
into 15 prime contracts and leverages economies of scale to 
save both time and money, enabling greater oversight and 
accountability.
    Our Strategic Capital Investment Planning, SCIP, defines 
and assesses VA's large capital portfolio and enables improved 
efficiency of operations.
    Last November we launched two online metric systems, one 
called LinKS (Linking Information, Knowledge, and Systems), and 
the other one called Aspire. Together these systems allow VA to 
increase our quality of health care against private-sector 
benchmarks transparently.
    VA successfully remediated three of four long-standing 
material weaknesses in 2010 and earned our 12th consecutive 
clean audit opinion on our consolidated financial statements.
    Finally, we have implemented Medicare's standard payment 
rates and consolidated contracting requirements to reduce cost 
and waste.
    A recent independent study, which covered a 10-year period, 
found that VA's health IT investments between 1997 and 2007 
amounted to $4 billion while savings from those investments 
came to over $7 billion. More than 86 percent of the savings 
resulted from the elimination of duplicate tests and reduced 
medical errors, contributing overall to reduced workload and 
lowered operating costs.
    The 2012 budget continues to focus on our three key 
transformational priorities: expanding access; reducing and 
ultimately eliminating the backlog; and ending veterans' 
homelessness by the year 2015--three visible and urgent 
priorities.
    A comprehensive review is underway to use VA's inventory of 
vacant or underutilized buildings to house homeless and at-risk 
veterans and their families, where practical.
    Congress allocated $50 million to renovate unused VA 
buildings. We have identified 94 sites with the potential to 
add approximately 6,300 units of housing through public-private 
ventures using VA's enhanced use lease authority.
    As we discussed, Madam Chairman, this enhanced-use lease 
authority is scheduled to lapse at the end of 2011, and its 
reauthorization is important to us and vital to our plans to 
increase housing for homeless veterans and families.
    Today, the most flexible housing option is a HUD voucher. 
We work quite closely with the Department of Housing and Urban 
Development. Both Secretary Donovan and I endorse the 
importance of this joint effort to care for our homeless 
veterans, our only option at the moment for housing veterans 
with families.
    As advocates for veterans and their families, VA is 
committed to providing the very best services. I will do 
everything possible to ensure that we wisely use the funds 
Congress appropriates for VA to improve the quality-of-life for 
veterans innovatively and transparently as we deliver on 
enduring promises of Presidents and the obligations of the 
American people to veterans.
    Again, Madam Chairman, thank you for this opportunity to 
appear before this Committee and for your continued unwavering 
support. I look forward to your questions.
    [The prepared statement of Secretary Shinseki follows:]
        Prepared Statement of Hon. Eric K. Shinseki, Secretary, 
                  U.S. Department of Veterans Affairs
    Chairman Murray, Ranking Member Burr, Distinguished Members of the 
Senate Committee on Veterans' Affairs: Thank you for the opportunity to 
present the President's 2012 Budget and 2013 Advance Appropriations 
Requests for the Department of Veterans Affairs (VA). Budget requests 
for this Department deliver the promises of Presidents and fulfill the 
obligations of the American People to those who have safeguarded us in 
times of war and peace.
    Today, the Nation's military remains deployed overseas as it has 
during the last 9 years of major conflict. Our requirements have grown 
over the past two years as we addressed longstanding issues from past 
wars and watched the requirements for those fighting the current 
conflicts grow significantly. These needs will continue long after the 
last American combatant departs Iraq and Afghanistan. It is our intent 
to continue to uphold our obligations to our Veterans when these 
conflicts have subsided, something that we have not always done in the 
past. Not upholding these obligations in the past has left at least one 
generation of Veterans struggling in anonymity for decades. We, who 
sent them, owe them better.
    VA has an obligation to track, communicate to stakeholders, and 
take decisive action to consistently meet the requirements of our 
Nation's Veterans for care and services. We pay great attention to 
detail but there are many factors in the health care market that we 
cannot control. We must mitigate the risk inherent when requirements 
for Veterans' care and services, and costs in the healthcare market, 
exceed our estimates. This request is the Department's plan for 
managing that risk and meeting our obligations to all Veterans 
effectively, accountably, and efficiently.
    The President's budget for 2012 requests $132 billion--$62 billion 
in discretionary funds and $70 billion in mandatory funding. Our 
discretionary budget request represents an increase of $5.9 billion, or 
10.6 percent, over the 2010 enacted level.
    Our plans for 2012 and 2013 pursue strategic goals we established 
two years ago to transform VA into an innovative, 21st century 
organization that is people-centric, results-driven, and forward-
looking. These strategic goals seek to reverse in-effective 
decisionmaking, systematic inefficiency, and poor business practices in 
order to improve quality and accessibility to VA healthcare, benefits, 
and services; increase Veteran satisfaction; raise readiness to serve 
and protect in a time of crisis; and improve VA internal management 
systems to successfully perform our mission. We seek to serve as a 
model of governance, and this budget is shaped to provide VA both the 
tools and the management structure to achieve that distinction.
    For almost 146 years now, VA and its predecessor institutions have 
had the singular mission of caring for those who have ``borne the 
battle'' and their survivors. This is our only mission, and to do that 
well, we operate the largest integrated healthcare system in the 
country; the eighth largest life insurance entity covering both active 
duty members as well as enrolled Veterans; a sizable education 
assistance program; a home mortgage enterprise which guarantees over 
1.4 million Veterans' home loans with the lowest foreclosure rate in 
the Nation; and the largest national cemetery system, which continues 
to lead the country as a high performing institution.
    For two years now, we have disciplined ourselves to understand that 
successful execution of any strategic plan, especially one for a 
Department as large as ours, requires good stewardship of resources 
entrusted to us by the Congress. Every dollar counts, both in the 
current constrained fiscal environment and during less stressful times. 
Accountability and efficiency are behaviors consistent with our 
philosophy of leadership and management. The responsibility of caring 
for America's Veterans on behalf of the American people demands 
unwavering commitment to effectiveness, accountability, and in the 
process, efficiency. In the past two years, we have established and 
created management systems, disciplines, processes, and initiatives 
that help us eliminate waste.
                        stewardship of resources
    VA has made great progress instilling accountability and 
disciplined processes by establishing our Project Management 
Accountability System (PMAS). This approach has created an information 
technology (IT) organization that can rapidly deliver technology to 
transform VA. PMAS is a disciplined approach to IT project development 
whereby we hold ourselves and our private-sector partners accountable 
for cost, schedule and performance. In just one year, PMAS exceeded an 
80% success rate of meeting customers' milestones.
    In addition to PMAS, we adopted a new acquisition strategy to make 
more effective use of our IT resources. This new strategy, 
Transformation Twenty-One Total Technology (T4, for short), will 
consolidate our IT requirements into 15 prime contracts, leveraging 
economies of scale to save both time and money and enable greater 
oversight and accountability. T4 also includes significant goals for 
subcontractors and other protections to make sure Veteran-owned small 
businesses get a substantial share of the work. Seven of the 15 prime 
contracts are reserved for Veteran-owned small businesses, and four of 
the seven are reserved for service-disabled small businesses.
    In developing the 2012 budget, VA used an innovative, Department-
wide process to define and assess VA's capital portfolio. This process 
for Strategic Capital Investment Planning (SCIP) is a transformative 
tool enabling VA to deliver the highest quality of services by 
investing in the future and improving efficiency of operations. SCIP 
has captured the full extent of VA infrastructure and service gaps and 
developed both capital and non-capital solutions to address these gaps 
through 2021. SCIP also produced VA's first-ever Department-wide 
integrated and prioritized list of capital projects, which is being 
used to ensure that the most critical infrastructure needs are met, 
particularly in correcting safety, security, and seismic deficiencies, 
and creating consistent standards across the system.
    The use of metrics to monitor and assess performance is another key 
strategy we employ to ensure the effective use of resources and 
accountability. For example, in November 2010, VA launched two online 
dashboards to offer transparency of the clinical performance of our 
healthcare system to the general public. First, VA's Linking 
Information Knowledge and Systems (LinKS) provides outcome measurement 
data in areas such as acute, intensive, and outpatient care. This 
allows management to assess a specific medical facility's performance 
against other facilities while, at the same time, serving as a 
motivational tool to improve performance. The dashboard, Aspire, 
compiles data from VA's individual hospitals and hospital systems to 
measure performance against national private-sector benchmarks. 
Financial and performance metrics also provide the foundation for 
monthly performance reviews that are chaired by the Deputy Secretary. 
These monthly meetings play a vital role in monitoring performance 
throughout the Department, and are designed to ensure both operational 
efficiency and the achievement of key performance targets.
    We also demonstrated our ongoing commitment to effective 
stewardship of our financial resources by obtaining our 12th 
consecutive unqualified (clean) audit opinion on VA's consolidated 
financial statements. In 2010, we were successful in remediating 3 of 4 
longstanding material weaknesses, a 75 percent reduction in just one 
year. We also began implementation of a number of key management 
initiatives that will allow us to better serve Veterans by getting the 
most out of our available resources:

     Reducing improper payments and improving operational 
efficiencies in our medical fee care program will result in estimated 
savings of $150 million in 2011. This includes continued expansion of 
the Consolidated Patient Account Centers to standardize VA's billing 
and collection activities.
     Implementing Medicare's standard payment rates will allow 
VA to better plan and redirect more funding into the provision of 
healthcare services. The estimated savings of this change in business 
practices in 2011 is $275 million.
     Consolidating contracting requirements, adopting strategic 
sourcing and other initiatives will reduce acquisition costs by an 
estimated $177 million in 2011.

    The effective use of information technology is critical to 
achieving efficient healthcare and benefits delivery systems for 
Veterans. To accelerate the process for adjudicating disability claims 
for new service-connected presumptive conditions associated with 
exposure to Agent Orange, we implemented a new on-line claims 
application and processing system.
    A recent independent study, which covered a 10-year period between 
1997 and 2007, found that VA's health IT investment during the period 
was $4 billion, while savings were more than $7 billion.\1\ More than 
86 percent of the savings were due to the elimination of duplicated 
tests and reduced medical errors. The rest of the savings came from 
lower operating expenses and reduced workload. VA is continuing to 
modernize its electronic medical records to optimally support 
healthcare delivery and management in a variety of settings. This 
effort includes migrating the current computerized patient record 
system into a modern, Web-based electronic health record.
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    \1\ The Value From Investments In Health Information Technology at 
the U.S. Department of Veterans Affairs, Colene M. Byrne, Lauren M. 
Mercincavage, Eric C. Pan, Adam G. Vincent, Douglas S. Johnston, and 
Blackford Middleton, Health Aff April 2010 29:4629-638.
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    Advance appropriations for VA medical care require a multi-year 
approach to budget planning whereby one year builds off the previous 
year. This provides opportunities to more effectively use resources in 
a constrained fiscal environment as well as to update requirements.
                multi-year plan for medical care budget
    The 2012 budget request for VA medical care of $50.9 billion is a 
net increase of $240 million over the 2012 advance appropriations 
request of $50.6 billion in the 2011 budget. This is the result of an 
increase of $953 million associated with potential increased reliance 
on the VA healthcare system due to economic employment conditions, 
partially offset by a rescission of $713 million which reflects the 
cumulative impact of the statutory freeze on pay raises for Federal 
employees in 2011 and 2012. The 2013 request of advance appropriations 
is $52.5 billion, an increase of $1.7 billion over the 2012 budget 
request.
    The establishment of a Contingency Fund of $953 million for medical 
care is requested in 2012. These contingency funds would become 
available for obligation if the Administration determines that 
additional costs, due to changes in economic conditions as estimated by 
VA's Enrollee Health Care Projection Model, materialize in 2012. This 
economic impact variable was incorporated into the Model for the first 
time this year. Based on experience from 2010, the need for this fund 
will be carefully monitored in 2011 and 2012. This cautious approach 
recognizes the potential impact of economic conditions as estimated by 
the Model to ensure funds are available to care for Veterans, while 
acknowledging the uncertainty associated with the new methodology 
incorporated into the Model estimates.
    Another key building block in developing the 2012 and 2013 budget 
request for medical care is the use of unobligated balances, or 
carryover, from 2011 to meet projected patient demand. This carryover 
of more than $1 billion, which includes savings from operational 
improvements, supports anticipated costs for providing medical care to 
Veterans in 2012 and 2013 and is factored into VA's request for 
appropriations. This is a vital component of our multi-year budget and 
any reductions in the amount of 2011 projected carryover funding would 
require increased appropriations in 2012 and 2013.
                            transforming va
    The Department faces an increasingly challenging operating 
environment as a result of the changing population of Veterans and 
their families and the new and more complex needs and expectations for 
their care and services. Transforming VA into a 21st-century 
organization involves a commitment to many broad challenges: to stay on 
the cutting edge of healthcare delivery; to lay the foundation for 
safe, secure, and authentic health record interoperability; to deliver 
excellent service for Veterans who apply for disability and education 
benefits; and to create a modern, efficient, and customer-friendly 
interface that better-serves Veterans. In this journey, we are focusing 
on opportunities to improve our efficiency and effectiveness and the 
individual performance of our employees.
    Our health informatics initiative is a foundational component for 
VA's transition from a medical model to a patient-centered model of 
care. The delivery of healthcare will be better tailored to the 
individual Veteran, yet utilize treatment regimens validated through 
population studies. Veterans will receive fewer unnecessary tests and 
procedures and more standardized care based on best practices and 
empirical data.
    The purpose of the VA Innovation Initiative (VAi2) is to identify, 
fund, and test new ideas from VA employees, academia, and the private 
sector. The focus is on improving access, quality, performance, and 
cost. VA remains committed to the best system of delivering quality 
care and benefits to Veterans. VAi2 plays an important role by enabling 
the use of promising technologies in the design of cost-effective 
solutions. For example, TBI Toolbox pilot, located at McGuire VA 
Medical Center in Richmond, Virginia, will test a software tool to 
standardize data gathered from brain injury treatments. The strategy 
will allow sharing of rapidly evolving treatment guidelines at VA 
polytrauma centers and Department of Defense medical facilities, as 
well as patient progress and outcomes.
    The 2012 budget continues our focus on three key transformational 
priorities I established when I became Secretary: Expanding access to 
benefits and services; reducing the claims backlog; and eliminating 
Veteran homelessness by 2015. These priorities address the most visible 
and urgent issues in VA.
               expanding access to benefits and services
    Expanding access to healthcare and benefits for underserved 
Veterans is vital to VA's success in best-serving Veterans of all eras.
    The Veterans Relationship Management (VRM) initiative will provide 
Veterans, their families, and survivors with direct, easy, and secure 
access to the full range of VA programs through an efficient and 
responsive multi-channel program, including phone and Web services. VRM 
will provide VA employees with up-to-date tools to better serve VA 
clients, and empower clients through enhanced self-service 
capabilities. Expanding the self-service capabilities of the eBenefits 
on-line portal is one of the early successes of the VRM program in 
2010, and expansion of eBenefits functionality continues through 
quarterly releases and programs to engage new users.
    VA also saw significant progress in expanding access to Veterans. 
In July 2010, the Center for Women Veterans sponsored a forum to 
highlight enhancements in VA services and benefits for women Veterans 
which resulted in an information toolkit tor advocates such as Veteran 
Service Organizations to share with their constituencies.
    Outreach was extended directly to women when, for the first time in 
25 years, VA surveyed women Veterans across the country to (1) identify 
in a national sample the current status, demographics, healthcare 
needs, and VA experiences of women Veterans; (2) determine how 
healthcare needs and barriers to VA healthcare differ among women 
Veterans of different generations; and (3) assess women Veterans' 
healthcare preferences in order to address VA barriers and healthcare 
needs. The interim report, released in summer 2010, informs policy and 
planning and provides a new baseline for program evaluation with regard 
to Veterans' perceptions of VA health services. The final report will 
be released in spring 2011.
    The Enhancing the Veteran Experience and Access to Healthcare 
(EVEAH) initiative will expand healthcare for Veterans, including women 
and rural populations. Care alternatives will be created to meet these 
special population access needs, including the use of new technology. 
Where technology solutions safely permit, VA has already transitioned 
from inpatient to outpatient settings through the use of tele-medicine, 
in-home care, and other delivery innovations.
    One area of success is our expansion of telehome health-based 
clinical services in rural areas, which increases access, and reduces 
avoidable travel for patients and clinicians. In 2010, the total 
average daily census in telehome health was 31,155. This program will 
continue to expand to an estimated average daily census of 50,147 in 
2012, an increase of 60 percent over 2010.
    Through the Improve Veteran Mental Health (IVMH) initiative more 
Veterans will have access to the appropriate mental health services for 
which they are eligible, regardless of their geographic location. VA is 
leveraging the virtual environment with services such as the Veterans' 
Suicide Prevention Chat Line and real-time clinical video conferences.
                      reducing the claims backlog
    One of VA's highest priority goals is to eliminate the disability 
claims backlog by 2015 and ensure all Veterans receive a quality 
decision (98 percent accuracy rate) in no more than 125 days. VBA is 
attacking the claims backlog through a focused and multi-pronged 
approach. At its core, our transformational approach relies on three 
pillars: a culture change inside VA to one that is centered on advocacy 
for Veterans; collaborating with stakeholders to constantly improve our 
claims process using best practices and ideas; and deploying powerful 
21st century IT solutions to simplify and improve claims processing for 
timely and accurate decisions the first time.
    The Veterans Benefits Management System (VBMS) initiative is the 
cornerstone of VA's claims transformation strategy. It integrates a 
business transformation strategy to address process and people with a 
paperless claims processing system. Combining a paperless claims 
processing system with improved business processes is the key to 
eliminating the backlog and providing Veterans with timely and quality 
decisions. The Virtual Regional Office, completed in May 2010, engaged 
employees and subject-matter experts to determine system specifications 
and business requirements for VBMS. The first VBMS pilot began in 
Providence in November 2010. Nationwide deployment of VBMS is expected 
to begin in 2012.
    VA is encouraging Veterans to file their Agent Orange-related 
claims through a new on-line claims application and processing system. 
Vietnam Veterans are the first users of this convenient automated 
claims processing system, which guides them through Web-based menus to 
capture information and medical evidence for faster claims decisions. 
While the new system is currently limited to claims related to the new 
Agent Orange presumptive conditions of Parkinson's Disease, Ischemic 
Heart Disease, and Hairy Cell Leukemia's, we will expand it to include 
claims for other conditions.
    VA also published the first set of streamlined forms capturing 
medical information essential to prompt evaluation of disability 
compensation and pension claims, and dozens more of these forms are in 
development for various disabilities. The content of these disability 
benefit questionnaires is being built into VA's own medical information 
system to guide in-house examinations. Veterans can provide them to 
private doctors as an evidence guide that will speed their claims 
decisions.
    Another initiative to reduce the time needed to obtain private 
medical records utilizes a private contractor to retrieve the records 
from the provider, scan them into a digital format, and send them to VA 
through a secure transmission. This contract frees VA staff to focus on 
processing claims more quickly.
    Additional claims transformation efforts deployed nationwide in 
2010 include the Fully Developed Claims initiative to promptly rate 
claims submitted with all required evidence and an initiative to 
proactively reach out to Veterans via telephone to quickly resolve 
claims issues.
    VA needs these innovative systems and initiatives to expedite 
claims processing as the number of claims continue to climb. The 
disability claims workload from returning war Veterans, as well as from 
Veterans of earlier periods, is increasing each year. Annual claims 
receipts increased 51 percent when comparing receipts from 2005 to 2010 
(788,298 to 1,192,346). We anticipate claims receipts of nearly 1.5 
million in 2011 (including new Agent Orange presumptive) and more than 
1.3 million claims in 2012. The funding request in the President's 
budget for VBA is essential to meet the increasing workload and put VA 
on a path to achieve our ultimate goal of no claims over 125 days by 
2015.
                    eliminating veteran homelessness
    VA has an exceptionally strong track record in decreasing the 
number of homeless Veterans. Six years ago, there were approximately 
195,000 homeless Veterans on any given night; today, there are about 
75,600. VA uses a multi-faceted approach by providing safe housing; 
outreach; educational opportunities; mental healthcare and treatment; 
support services; homeless prevention services, and opportunities to 
return to employment. The National Call Center for Homeless has 
received 13,000 calls since March 2010, and 18,000 Veterans and 
families of Veterans have been provided permanent housing through VA 
and Housing and Urban Development Department programs. These Veterans 
were also provided with dedicated case managers and access to high-
quality VA healthcare.
    The Building Utilization Review and Repurpose (BURR) study is using 
VA's inventory of vacant/underutilized buildings to house homeless and 
at-risk Veterans and their families, where practical. Congress 
allocated $50 million to renovate unused VA buildings and VA has 
identified 94 sites with the potential to add approximately 6,300 units 
of housing through public/private ventures using VA's enhanced-use 
lease authority. This legislative authority is scheduled to lapse at 
the end of calendar year 2011. The Administration remains committed to 
this important program, and a proposal to address the expiration will 
accompany the Department's legislative package submitted through the 
President's Program. In addition to helping reduce homelessness, vacant 
building reuse is being considered for housing for OEF/OIF/OND 
Veterans, poly-trauma patients, assisted living, and seniors.
    Homelessness is both a housing and healthcare issue, heavily 
burdened by depression and substance abuse. Our 2012 budget plan also 
supports a comprehensive approach to eliminating Veteran homelessness 
by making key investments in mental health programs.
    The 2012 budget includes $939 million for specific programs to 
prevent and reduce homelessness among Veterans. This is an increase of 
17.5 percent, or $140 million over the 2011 level of $799 million. This 
increase includes an additional $50.4 million to enhance case 
management for permanent housing solutions offered through the Housing 
Urban Development-VA Supported Housing (HUD-VASH) program. These funds 
are required to maintain the services that keep Veterans rescued from 
homelessness sheltered; get the remaining men and women off the streets 
whom we have not reached in the past; and, prevent additional Veterans 
from becoming homeless during a time of war and difficult economic 
conditions.
                             mental health
    The mental health of Veterans is a more important issue now than 
ever before, as increasing numbers of Veterans are diagnosed with 
mental health conditions, often coexisting with other medical problems. 
More than 1.2 million of the 5.2 million Veterans seen in 2009 in VA 
had a mental health diagnosis. This represents about a 40 percent 
increase since 2004.
    Veterans of Iraq and Afghanistan rely on mental healthcare from VA 
to a greater degree than earlier groups of Veterans. Diagnosis of PTSD 
is on the rise as the contemporary nature of warfare increases both the 
chance for injuries that affect mental health and the difficulties 
facing Veterans upon their return home. In addition, mental health 
issues are often contributing factors to Veterans' homelessness.
    In order to address this challenge, VA has significantly invested 
in our mental healthcare workforce, hiring more than 6,000 new mental 
healthcare workers since 2005. In 2010, VA hired more than 1,500 
clinicians to conduct screenings and provide treatment as well as 
trained over 1,000 clinicians in evidenced-based practices. The 
Department has also established high standards for the provision of 
mental healthcare services through the recent publication of our 
Handbook on Uniform Mental Health Services in VA medical centers and 
clinics, and we have developed an integrated mental health plan with 
DOD to ensure better continuity of care--especially for Veterans of 
Iraq and Afghanistan. The 2012 budget includes $6.2 billion for mental 
healthcare programs, an increase of $450 million, or 8 percent over the 
2011 level of $5.7 billion.
                          medical care program
    We expect to provide medical care to over 6.2 million unique 
patients in 2012, a 1.4 percent increase over 2011. Among this 
community are nearly 536,000 Veterans of Iraq and Afghanistan, an 
increase of over 59,000 (or 12.6 percent) above 2011.
    The 2012 budget will support several new initiatives in addition to 
our efforts to eliminate Veteran homelessness. For example, $344 
million is provided for the activation of newly constructed medical 
facilities. In addition, we provide $208 million to implement 
provisions of the Caregivers and Veterans Omnibus Health Services Act 
and improve the quality of life for Veterans and their families.
    The 2012 budget also includes operational improvements that will 
make VA more effective and efficient in this challenging fiscal and 
economic environment. VA is proposing $1.2 billion of operational 
improvements which include aligning fees that VA pays with Medicare 
rates, reducing and improving the administration of our fee-based care 
program, clinical staff realignments, reducing indirect medical and 
administrative support costs, and achieving significant acquisition 
improvements to increase our purchasing power.
    Beginning in 2010, VHA embarked on a multi-year journey to enhance 
significantly the experience of Veterans and their families in their 
interactions with VA while continuing to focus on quality and safety. 
This journey required the VHA to develop new models of healthcare that 
educated and empowered patients and their families, focused not only on 
the technical aspects of healthcare but also designed for a more 
holistic, Veteran-centered system, with improved access and 
coordination of care. New Models of Healthcare is a portfolio of 
initiatives created to achieve these objectives. We are re-designing 
our systems around the needs of our patients and improving care 
coordination and virtual access through enhanced secure messaging, 
social networking, telehealth, and telephone access.
    An essential component of this approach is transforming our primary 
care programs to increase our focus on health promotion, disease 
prevention, and chronic disease management through multidisciplinary 
teams. The new model of care will improve health outcomes and the care 
experience for our Veterans and their families. The model will 
standardize healthcare policies, practices and infrastructure to 
consistently prioritize Veterans' healthcare over any other factor 
without increasing cost or adversely affecting the quality of care. 
This important initiative will enable VA to become a national leader in 
transforming primary care services to a medical home model of 
healthcare delivery that improves patient satisfaction, clinical 
quality, safety and efficiencies. VA Tele-Health and the Home Care 
Model will develop a new generation of communication tools (i.e. social 
networking, micro-blogging, text messaging, and self management groups) 
that VA will use to disseminate and collect critical information 
related to health, benefits and other VA services.
    VA is taking this historic step in redefining medical care for 
Veterans with the adoption of a modern healthcare approach called PACT, 
which stands for Patient Aligned Care Team. PACT is VA's adaptation of 
the popular contemporary team-based model of healthcare known as 
Patient Centered Medical Home designed to provide continuous and 
coordinated care throughout a patient's lifetime.
                            medical research
    VA's many trailblazing research accomplishments are a source of 
great pride to our department and the Nation. Today's committed VA 
researchers are focusing on Traumatic Brain Injury, Post Traumatic 
Stress Disorder, post-deployment health, women's health and a host of 
other issues key to the well-being of our Veterans. As one of the 
world's largest integrated healthcare systems, VA is uniquely 
positioned to not only conduct and fund research, but to develop 
solutions and implement them more quickly than other healthcare 
systems--turning hope into reality for Veterans and all Americans.
    VA's budget request for 2012 includes $509 million for research, a 
decrease of $72 million below the 2010 level. In addition, VA's 
research program will receive approximately $1.2 billion from medical 
care funding and Federal and non-Federal grants. These research funds 
will continue support for genomic medicine, point of care research, and 
medical informatics and information technology. Genomic medicine, also 
referred to as personalized medicine, uses information on a patient's 
genetic make-up to tailor prevention and treatment for that individual. 
The Million Veteran Program invites users of the VA healthcare system 
nationwide to participate in a longitudinal study with the aim of 
better understanding the relationship between genetic characteristics, 
behaviors and environmental factors, and Veteran health.
    To leverage data in the electronic health record, VA Informatics 
and Computing Infrastructure (VINCI) is creating a powerful and secure 
environment within the Austin Information Technology Center. This 
environment will allow VA researchers to access more easily a wide 
array of VHA databases using custom and off-the-shelf analytical tools. 
The Consortium for Healthcare Informatics Research (CHIR) will provide 
research access to patient information in VA's Computerized Patient 
Record System (CPRS) narrative text and laboratory reports. Together, 
VINCI and CHIR will allow data mining to accelerate findings and 
identify emerging trends. Ultimately, this critical work will lead to 
greater effectiveness of our medical system--improving value by 
assisting in the prevention and cure of disease.
                            veteran benefits
    The 2012 budget request for the Veterans Benefits Administration is 
$2.0 billion, an increase of $330 million, or 19.5 percent, over the 
2010 enacted level of $1.7 billion. This budget supports ongoing and 
new initiatives to reduce disability claims processing time, including 
development and implementation of further redesigned business 
processes. It funds an increase in FTE of 716 over 2010 to 20,321 to 
assist in reducing the benefits claims backlog. It also supports the 
administration of expanded education benefits eligibility under the 
Post-9/11 GI Bill, which now includes benefits for non-college degree 
programs, such as on-the-job training, flight training, and 
correspondence courses. In addition, the 2012 budget request supports 
the following initiatives:

Integrated Disability Evaluation System (IDES) Program
    IDES simplifies the process for disabled servicemembers 
transitioning to Veteran status, improves the consistency of disability 
ratings, and improves customer satisfaction. An IDES claim is completed 
in an average of 309 days; 43 percent faster than in the legacy system. 
VA and DOD worked together to increase the number of sites for the IDES 
program from 21 to 27 in 2010. The six new sites are Fort Riley, Fort 
Benning, Fort Lewis, Fort Hood, Fort Bragg and Portsmouth Naval 
Hospital, and VA and DOD will continue to expand the IDES program.
    IDES is being expanded to provide Vocational Rehabilitation and 
Employment (VR&E) services to active duty Servicemembers transitioning 
through the IDES. These services range from a comprehensive 
rehabilitation evaluation to determine abilities, skills, and interests 
for employment purposes as well as support services to identify and 
maintain employment. The budget request includes $16.2 million for 110 
FTE for the VR&E program to support IDES.
Veterans Benefits Management System (VBMS)
    In 2011, we will conduct two of three planned pilot programs to 
test VBMS, the new paperless claims processing system. Each pilot will 
expand on the success of the first pilot by adding additional software 
components. In the 2012 budget request for information technology, we 
will invest $148 million to complete pilot testing and initiate a 
national rollout.
VetSuccess on Campus
    In July 2009, VA established a pilot program at the University of 
South Florida called VetSuccess on Campus to improve graduation rates 
by providing outreach and supportive services to Veterans entering 
colleges and universities and ensuring that their health, education and 
benefit needs are met. The program has since expanded to include an 
additional seven campuses, serving approximately 8,000 Veterans. The 
campus Vocational Rehabilitation Counselor (VRC) and the Vet Center 
Outreach Coordinator liaise with school certifying officials, perform 
outreach, and communicate with Veteran-students to ensure their health, 
education, and benefit needs are met. This will enable Veterans to stay 
in college to complete their degrees and enter career employment. In 
addition, it provides Veterans the skills necessary to gain employment 
after graduation, which can help prevent Veteran homelessness. The 2012 
budget includes $1.1 million to expand the program to serve an 
additional 9,000 Veteran students on nine campuses, more than doubling 
the size of the current program.
                    national cemetery administration
    The budget plan includes $250.9 million in operations and 
maintenance funding for the National Cemetery Administration (NCA). The 
funding will allow us to provide more than 89.8 percent of the Veteran 
population a burial option within 75 miles of their residences by 
keeping existing national cemeteries open and establishing new state 
Veterans cemeteries, as well as increasing outreach efforts.
    VA expects to perform 115,500 interments in 2012, a 1.0 percent 
increase over 2011. In 2012, NCA will provide maintenance of 8,759 
developed acres, 3.0 percent over the 2011 estimate, while 3,228,000 or 
2.6 percent more gravesites will be given perpetual care.
    The budget request will allow NCA to maintain unprecedented levels 
of customer satisfaction. NCA achieved the top rating in the Nation 
four consecutive times on the prestigious American Customer 
Satisfaction Index (ACSI) established by the University of Michigan. 
ACSI is the only national, cross-industry measure of satisfaction in 
the United States. On the most recent 2010 survey and over the past 
decade, NCA's scores bested over 100 Federal agencies and the Nation's 
top corporations including Ford, FedEx and Coca Cola, to name a few. 
Our own internal surveys confirm this exceptional level of performance. 
For 2010, 98% of the survey respondents rated the appearance of 
national cemeteries as excellent; 95% rated the quality of service as 
excellent.
    NCA has implemented innovative approaches to cemetery operations: 
the use of pre-placed crypts, that preserve land and reduce operating 
costs; application of ``water-wise'' landscaping that conserves water 
and other resources; and installation of alternative energy products 
such as windmills and solar panels that supply power for facilities. 
NCA has also utilized biobased fuels that are homegrown and less 
damaging to the environment. NCA is developing an independent study of 
emerging burial practices throughout the world to inform its planning 
for the future.
    Support for the Veterans Cemetery Grants Program continues in 2012 
with $46 million to fund the highest priority Veterans cemetery grant 
requests ready for award. In addition to state cemetery grants, NCA is 
engaged in discussions with tribal governments regarding the 
construction of Veterans' cemeteries on their land and is awarding six 
such grants in 2011. The inclusion of tribal governments as grant 
recipients recognizes and empowers the authority of these groups to 
represent a unique group of Veterans and respond to their needs.
                         capital infrastructure
    Congressional support of VA has resulted in 63 major construction 
projects funded in whole, or in part, since 2004. When combined with 
investments in our minor construction and major lease programs, this 
has contributed to a plant inventory which includes 5,541 owned 
facilities, 1,629 leased facilities, 155 million square feet of 
occupied space (owned and leased) and 33,718 acres of owned real 
property.
    To best utilize resources, VA has reduced its inventory of owned 
vacant space by 34 percent, from 8.6 million square feet in 2001 to 5.7 
million square feet in 2010. As discussed previously, we are using the 
Building Utilization Review and Repurpose (BURR) effort to reuse vacant 
space for homeless Veterans and their families. BURR also identifies 
other potential reuses of vacant and underutilized space and land 
within VA's inventory such as assisted living, senior housing, and 
housing for Veterans of Iraq and Afghanistan and their families. VA 
also houses homeless Veterans in public/private ventures through 
enhanced-use leasing.
Major Construction
    The major construction request in 2012 is $589.6 million in new 
budget authority. In addition, VA has been the beneficiary of a 
favorable construction market and, as a result, is able to reallocate 
$135.6 million from previously authorized and appropriated projects to 
accomplish additional project work--resulting in a total of $725.2 
million for the major construction program. This reflects the 
Department's continued commitment to provide quality healthcare and 
benefits through improving its infrastructure to provide for modern, 
safe, and secure facilities for Veterans. It includes seven ongoing 
medical facility projects (New Orleans, Denver, San Juan, St. Louis, 
Palo Alto, Bay Pines, and Seattle) and design for three new projects 
(Reno, West Los Angeles and San Francisco) primarily focused on safety 
and security corrections. One cemetery expansion will be completed to 
maintain and improve burial service in Honolulu, HI.
Minor Construction
    In 2012, the minor construction request is $550.1 million. In 
support of the medical care and medical research programs, minor 
construction funds permit VA to realign critical services, make seismic 
corrections, improve patient safety, enhance access to healthcare and 
patient privacy, increase capacity for dental care, improve treatment 
of special emphasis programs, and, expand our research capability. We 
also use minor construction funds to improve the appearance of our 
national cemeteries. Further, minor construction resources will be used 
to comply with energy efficiency and sustainability design 
requirements.
Greening VA
    The ``greening VA'' effort continues to be strong. There are 21 
facilities Green Globe-certified and four LEED-certified. We have 
completed energy efficiency benchmarking for 99% of VA-owned facilities 
and obtained the Energy Star label for 30 VA sites since 2003. Electric 
meter installations were completed for 60% of targeted buildings and we 
are installing solar energy systems at 35 sites for a total capacity of 
30 megawatts. VA has installed wind turbines at two sites, awarded two 
ground source heat pump projects, awarded five renewably fueled 
cogeneration projects, and completed one fuel cell project.
    In 2012, we plan to invest $27 million for solar photovoltaic 
projects, $51 million in energy infrastructure improvements, $21 
million in renewably fueled cogeneration using biomass (wood waste) or 
biogas (waste methane), $1 million in sustainable building, $14 million 
for wind projects, and $10 million for alternative fueling projects and 
expansion of environmental management systems.
                         information technology
    Information Technology (IT) is integral to the delivery of 
efficient and effective service to Veterans. IT is not a supplementary 
function--it is key to the delivery of efficient, modern healthcare. 
The 2012 budget includes $3.161 billion to support Information 
Technology (IT) development, operations and maintenance expenses. The 
2012 budget will fund the Department's highest IT priorities as well as 
information security programs, which protect privacy and provide secure 
IT operations across VA. Under our disciplined development program, 
PMAS, the delivery of customer software milestones exceeds 80% which is 
up from just 20% before the implementation of PMAS. The budget request 
will also fund systems that VA will develop and implement under the 
Caregivers and Veterans Omnibus Health Services Act of 2010.
    In 2010, VA made the sound business decision to discontinue the 
Integrated Financial Accounting System (IFAS) and the data warehouse 
component of the Financial and Logistics Integrated Technology 
Enterprise (FLITE). OI&T will fund other continuing projects such as 
Compensation and Pension Records Interchange (CAPRI) which offers VBA 
Rating Veteran Service Representatives and Decision Review Officers 
help in building the rating decision. CAPRI does this by creating a 
more efficient means of requesting compensation and pension 
examinations and navigating existing patient records.
Veterans Relationship Management (VRM)
    The 2012 IT budget for VRM is $108 million, and will support 
continued development of the on-line portal as well as the development 
of Customer Relationship Management capabilities.
Virtual Lifetime Electronic Record (VLER)
    The Virtual Lifetime Electronic Record (VLER) is a Federal, inter-
agency initiative to provide portability, accessibility and complete 
health, benefits, and administrative data for every Servicemember, 
Veteran, and their beneficiaries. The goal of this major initiative is 
to establish the interoperability and communication environment 
necessary to facilitate the rapid exchange of patient and beneficiary 
information that will yield consolidated, coherent and consistent 
access to electronic records between DOD, VA, and the private sector.
    VLER will not create a new data record, but it will ensure 
availability of reliable data from the best possible source. The VLER 
health component of this initiative is in operation at two pilot sites 
with a plan to add nine more pilots this fiscal year. VLER will work 
closely with other major initiatives including the Veterans Benefits 
Management System (VBMS) and the Veterans Relationship Management 
(VRM). A total of $70 million in IT funds in 2012 is required to 
complete the effort and move to national production and deployment of 
initial VLER capabilities. The VLER partnership between VA and the 
Department of Defense will serve as a positive model for electronic 
health record interoperability in the country, which has been an 
Administration priority.
                                summary
    VA is the second largest Federal department and has over 300,000 
employees. Among the many professions represented in the vast VA 
workforce are physicians, nurses, counselors, claims processors, 
cemetery groundskeepers, statisticians, engineers, architects, computer 
specialists, budget analysts, police, and educators--all working with 
the greatest determination to best serve all generations of Veterans. 
In addition, VA has approximately 140,000 volunteers serving Veterans 
at our hospitals, Vet centers and cemeteries. There are things that 
they do that cannot be converted into dollar values--patience, dignity 
and respect for Veterans, some of whom are heavily challenged by the 
memories of their wars.
    As advocates for Veterans and their families, VA is committed to 
providing the very best services. I will do everything possible to 
ensure that we wisely use the funds Congress appropriates for VA to 
improve the quality of life for Veterans and the efficiency of our 
operations--innovatively and transparently--as we deliver on the 
enduring promises of Presidents and the obligations of the American 
people to our Veterans.

    I am honored to present the President's 2012 budget request for VA, 
and to represent all VA employees and the interests of those outside of 
VA, who share our commitment to Veterans.
                                 ______
                                 
  Response to Prehearing Questions Submitted by Hon. Patty Murray to 
 Hon. Eric K. Shinseki, Secretary, U.S. Department of Veterans Affairs
    Question 1. Please provide a list of the medical centers that are 
experiencing a budget shortfall in the current fiscal year, or which 
experienced a shortfall in FY 2010, the amounts of those shortfalls, 
whether or not a request has been made to the corresponding VISN for 
financial relief, and the response to any such request.
    Response. All Department of Veterans Affairs medical center (VAMC) 
requirements have been addressed within resources allocated to the 
Veterans Integrated Service Networks (VISN) in both fiscal year (FY) 
2010 and to date in FY 2011. All VISN Directors meet with the Secretary 
during the year to discuss their resource needs. No VISN Directors have 
indicated that they will not be able to accomplish their missions 
without additional resources in FY 2011.

    Question 2. The President's budget requests a drastic cut in the 
Medical and Prosthetic Research account of $72.2 million, or almost 
12.5 percent. What impact will this have on VA's research program and 
what specific programmatic cuts are being planned? How will this impact 
the prioritization of research programs?
    Response. VA supports research projects based on merit review, and 
within the FY 2012 budget, VA will support approximately 135 fewer 
projects from all services when compared with the FY 2010 level. While 
there will be fewer projects, VA will continue to emphasize research on 
deployment and Veteran-specific health issues. Areas of particular 
focus, such as Gulf War Veterans Illnesses, women Veterans and mental 
health, will be preserved or increased, with the reductions being 
realized across the board in other areas.
    VA's Office of Research and Development is adopting ISO 9001 
principles to increase management efficiencies in conducting clinical 
trials. The International Organization of Standardization (ISO) is 
widely considered to be the standard for efficient and effective 
management systems. These improvements will further reduce the cost of 
performing clinical trials by reducing administrative costs and 
streamlining processes

    Question 3. Does the VERA model sufficiently accounts for a variety 
of anomalies in hospital operations including seasonal workload 
changes, historic campuses, split campuses and the associated 
maintenance costs?
    Response. The Veterans Equitable Resource Allocation (VERA) model 
is designed to equitably distribute resources to the VISNs. In FY 2011, 
the Veterans Health Administration (VHA) is now using a standard model 
to further allocate funds from the VISN level to VAMCs. VISN Directors 
have the discretion to make appropriate adjustments to that model to 
reflect local realities, such as the activation of a new community-
based outpatient clinic (CBOC). These adjustments are left to the VISN 
Director's discretion because he or she has the best knowledge of and 
insight into what a specific facility needs.
    It should be noted that the VERA Model is designed to fund a full 
year of operation, so seasonal variations are accommodated within its 
allocations. Likewise the workload that drives VERA is measured over 
multiple years, so seasonal variation is also accommodated within that 
process.

    Question 4. Projections for the Medical Care Collections Fund have 
historically been very inaccurate. Why is the projected increase--from 
FY 2011 to FY 12--so low, relative to the growth in previous years?
    Response. VA recently instituted a scientifically-derived 
collections model including multiple variables such as projected 
workload, Veteran demographics, insurance status and economic 
conditions, to more accurately forecast collections. In FY 2010, VA 
experienced only a 1.4 percent increase in collections versus FY 2009 
($2.773B vs. $2.734B); based on our model output, there are a number of 
factors continuing to impact lower growth rates in FY 2011 and FY 2012:

     Poor economic conditions--Growth in national unemployment 
(from 7.7 percent in the First Quarter of FY 2009 to 9.8 percent at the 
end of the First Quarter of FY 2011) will continue to impact both first 
party collections (Veteran out-of-pocket costs) and third party 
collections (unemployment and resultant loss of health insurance 
coverage).
     Hardship waivers and exemptions from copayments are 
increasing--Veteran first party copayment economic hardship waivers and 
exemptions were at their highest levels in FY 2010 (the most recent 
completed year) than in any prior year and this is expected to continue 
with the current economic conditions.
     Third party ``Collections to Billings'' (CtB) ratios are 
down nationally--CtB ratios are expected to continue a downward trend 
impacting third party collections. CtB decreased from 43.1 percent in 
January 2009 to 39.1 percent in January 2011, and was influenced by the 
continued shift by insurers of payment responsibility to the patient 
(i.e., higher deductibles, increased copayments, etc.). Section 1729 of 
title 38 prevents VA from billing the Veteran if the insurance company 
does not pay. Each one percent decrease in CtB represents a $55 million 
loss in revenue.
     Priority Group migration from lower to higher status--
National Priority Group migration over the past 2 years has shown a 
sharp decrease in collections for Veterans in Priority Group 8 which 
are the primary drivers of both first and third party collections.

    Question 5. Please provide a breakdown of funding to be spent on 
implementing the Caregivers and Veterans Omnibus Health Services Act of 
2010 (PL 111-163). Please include a specific breakdown of funding to be 
spent on the family caregiver program, including dates by which the 
funds are projected to be spent.
    Response. VA has identified below a general timeline with goals for 
implementing the family caregiver program required by title I of Public 
Law (PL) 111-163, the Caregivers and Veterans Omnibus Health Services 
Act of 2010. VA's planning and work on regulations has been ongoing 
since before the Caregivers and Veterans Omnibus Health Services Act of 
2010 was signed into law. This work has continued throughout the time 
the implementation plan was under development. VA is working as quickly 
and responsibly as possible to deliver these enhanced benefits to 
eligible Veterans and their caregivers and will keep the Committee 
closely apprised of its progress.

Create Caregiver Support Line                          February1, 2011 (completed)
Hire All Caregiver Support Coordinators                April2011
New State-of-the-Art Web Site                          May2011



    A breakdown of funding to be spent on implementing Pub. L. 111-163 
is displayed below.

----------------------------------------------------------------------------------------------------------------
                                                                      FY 2011         FY 2012         FY 2013
                           Description                               Estimate        Estimate        Estimate
----------------------------------------------------------------------------------------------------------------
Total Caregivers and Veterans Omnibus Health Services Act of        $132 million    $208 million    $248 million
 2010 (PL 111-163)..............................................
Caregiver Support (Title I) (non-add)...........................     $30 million     $66 million     $71 million
----------------------------------------------------------------------------------------------------------------


    Question 6. Please provide a breakdown of the proposed clinical 
staff and resource realignment. What efficiencies does the Department 
anticipate achieving and how will this impact the quality of and access 
to patient care?
    Response. As positions currently filled by professional physicians 
and registered nurses become vacant, VA is filling these positions with 
more clinically appropriate and cost effective personnel, thereby 
ensuring the quality of care while reducing costs. Continued access 
will be ensured because this transition in clinical staff mix is 
occurring gradually and in conjunction with an increasing emphasis on 
appropriate task assignments and more efficient approaches to providing 
care. Some examples of these approaches include reliance on telephone 
contacts, secure messaging, and group visits. VA expects this 
transition will improve the quality of care through implementation of 
Patient Aligned Care Teams (PACT) and features such as disease 
registries, population approaches toward disease prevention and chronic 
disease management, and focused emphasis on higher risk patients.

    Question 7. How does VHA's current salary and incentive pay 
structure affect the willingness of top leaders to assume higher levels 
of responsibility, such as moving to more complex medical centers or to 
VISN offices? How does this structure compare with the private sector 
and what impact is it having on VHA's ability to recruit and retain 
top-level managers?
    Response. The 2006 modifications to compensation for VHA medical 
professionals have helped the Department recruit, retain, and promote 
skilled individuals it otherwise would not have been able to hire or 
would have lost. Compensation for VHA's professionals still lags behind 
that of their private sector counterparts, but these modifications have 
helped bring more care in-house as part of the Department's efforts to 
reduce Fee Basis and Contract Care without compromising timeliness or 
quality. It's worth noting, however, that the new compensation 
structure has exacerbated the pay inequity between VHA's medical 
professionals and senior managers that are not physicians, dentists, or 
nurses, whose compensation also lags behind their private sector 
counterparts. VHA shares this challenge recruiting and retaining these 
top-level managers with many other agencies across government. VHA will 
continue to monitor the extent to which this challenge impair our 
recruitment and retention of top-level managers, and will work with the 
Office of Personnel Management to address this issue.

    Question 8. Please provide a breakdown of the operating budgets and 
staffing levels for each VISN office.
    Response. The table below provides the operating budget and 
staffing levels for each VISN.


------------------------------------------------------------------------
                                                     FY 2011    Staffing
                       VISN                         Operating     Level
                                                      Budget      (FTE)
------------------------------------------------------------------------
 1...............................................   $4,522,000      30.0
 2...............................................   $4,027,013      22.7
 3...............................................   $9,590,840      43.0
 4...............................................  $11,618,654      69.0
 5...............................................  $10,300,000      54.0
 6...............................................   $9,916,086      52.0
 7...............................................   $9,000,000      58.5
 8...............................................  $17,200,000     100.8
 9...............................................  $13,200,000      63.0
10...............................................   $7,300,000      51.0
11...............................................  $10,950,353      57.0
12...............................................   $7,982,147      44.0
15...............................................   $6,271,017      40.0
16...............................................   $9,514,253      57.0
17...............................................  $13,216,139      76.0
18...............................................  $10,757,900      52.0
19...............................................   $8,311,641      46.5
20...............................................  $13,243,476      55.0
21...............................................   $7,442,950      52.0
22...............................................   $7,371,021      41.5
23...............................................   $6,531,485      47.0
------------------------------------------------------------------------


    Question 9. Please provide an estimate of the cost avoidance of 
expanded use of telehealth and tele-mental health technologies.
    Response. Telehealth technologies will realize cost avoidance 
through reduced utilization of health care resources in 
hospitalizations, reduced average length of stay, and decreased travel 
needs. This cost avoidance will allow VA more effective stewardship of 
health care resources and improve access for our Veterans. The actual 
cost avoidance is difficult to measure because in many instances it 
allows VA to provide more health care services within the same level of 
resources.

    Question 10. Given the increase in beneficiary travel, is there any 
concern that fraudulent claims are being paid out and, if so, to what 
extent? What can the Department do to improve enforcement to ensure 
only legitimate claims are paid?
    Response. As stewards of the taxpayers' funds, VA is always 
vigilant in monitoring the claims it receives and preventing the 
fraudulent use of resources. VA is implementing various initiatives to 
monitor and manage the Beneficiary Travel program to ensure the 
appropriate use and provision of Beneficiary Travel benefits. These 
efforts include:

     Distribution of communication material to assist Veterans 
in understanding their responsibilities related to this benefit.
     Regulatory changes to eliminate or clarify areas of 
confusion regarding travel eligibility and payment requirements.
     Identification of strong practices, including procedures 
and systems that effectively control this benefit. A national workgroup 
of subject matter experts has identified system-wide issues and 
potential solutions. Identified practices include a locally developed 
automated patient behavior and clinic utilization evaluation tool that 
allows stations to determine areas of local concern. This is currently 
being used in approximately 20 locations, and VA has scheduled a 
national release and training effort beginning in March 2011. VA is 
developing an automated tool that will standardize claims processing 
and payment procedures (and will include an audit capability) for 
national release this fiscal year. VA is gathering real cases of 
inappropriate use of Beneficiary Travel for use in a training program 
that will be offered in March and April 2011.
     Initiation of projects to identify national level data 
patterns that merit further review. This effort will allow VA to 
identify reimbursement transactions that are of a suspicious nature. 
This, in turn, will allow VA to identify various types of patterns and 
reimbursements within each pattern that merit further review.
     Definition and implementation of automated management 
systems that will improve and standardize internal controls of this 
benefit. VA is developing automated claims processing and audit tools 
to standardize procedures with an expected release date this fiscal 
year. VA is also in the initial stage of developing longer term 
solutions that are tentatively scheduled for initial development in the 
first quarter of FY 2012.

    Question 11. What adjustment was made in the level of resources 
requested for CHAMPVA to account for the incorporation of family 
caregivers under Public Law 111-163?
    Response. VA included estimates for the impact on the Civilian 
Health and Medical Program of the Department of Veterans Affairs 
(CHAMPVA) in its budget request for FY 2012 under the request for funds 
to support implementation of Public Law 111-163 rather than in the 
CHAMPVA-specific funds.

    Question 12. Legislation was introduced last Congress to extend a 
dependant child's CHAMPVA eligibility until age 26, in congruence with 
the health care reform legislation. Are the resources requested for 
CHAMPVA sufficient to accommodate this change?
    Response. VA has estimated the potential impact of changes to 
CHAMPVA eligibility based upon this legislation and provided this 
information to the Committee last Congress. The current budget 
estimates do not include these resources because no legislation has 
been enacted.

    Question 13. The President's FY 2011 budget included $217.6 million 
to enhance primary care for women veterans. Were any of these funds 
obligated to fixing the deficiencies identified in GAO's report, VA Has 
Taken Steps to Make Services Available to Women Veterans, but Needs to 
Revise Key Policies and Improve Oversight Processes, from last March? 
Please provide an accounting of these expenditures.
    Response. Following the Government Accountability Office's (GAO) 
report, ``VA Has Taken Steps to Make Services Available to Women 
Veterans, but Needs to Revise Key Policies and Improve Oversight 
Processes,'' (March 2010), VA has undertaken an extensive evaluation of 
its facilities, identifying existing deficiencies in the environment of 
care, including bathrooms, privacy curtains, locks, and other areas. 
These deficiencies have been prioritized and tracked for correction. In 
FY 2011, VA has budgeted $17 million in non-recurring maintenance (NRM) 
projects that will be used at the facility level to correct privacy 
deficiencies in addition to the $241.8 million of gender-specific care 
(from treatment funds) and $2.89 billion for total care for women 
Veterans. In FY 2010, VA spent over $214 million in gender-specific 
care and nearly $2.6 billion in total care for women Veterans.

    Question 14. The recently released 2010 Hospital Quality Report 
Card measured timeliness of care by presenting a table of wait times 
for completed appointments at each facility. Although the Report Card 
classifies patients as either new or established, there is no data 
presented on the differences in wait times between these two cohorts. 
Also, the data divided such wait times between primary and specialty 
care, but it is unclear whether there were differences in wait times 
across the varied types of specialty care. Further, there is no 
information provided on wait times for compensation and pension exams. 
Please provide supplementary information on wait times in terms of new 
and established patients, the subdivisions of specialty care, and 
compensation and pension exams both by contractors and VA providers, at 
each medical facility.
    Response. The enclosed spreadsheet includes data for each VA health 
care system. These data include wait times for new and established 
patients across the top 50 subdivisions of specialty care (clinical 
areas), as well as compensation and pension exams. [The enclosed 
spreadsheet is being held in the Committee files.]
    VA does not currently track and collect data on wait times from all 
contracted or other forms of purchased care. We are conducting a pilot 
program to develop greater management, control and oversight of the 
processes VA uses when we purchase care. This pilot is using 
standardized templates for ``ordering'' care, ensuring assessment of 
other VA options, and controlling and managing the care we do purchase. 
Specifically, we are instituting controls to track appointment dates, 
no-shows, and waiting times. We will also ensure we send the right 
clinical information prior to appointments and that we receive the 
appropriate clinical information after appointments. We will also track 
when and where Veterans receive emergent care to monitor from the time 
we first receive notification from an emergency room or hospital, 
throughout the Veteran's hospital stay, to the Veteran's transfer to a 
VA facility when appropriate and all other administrative elements 
associated with claims payments. We are conducting this pilot in VISN 
11 (Michigan), with one site in production and two others in 
development. VA will then expand this to VISN 18 (South West). We 
expect the results of the pilot to be available by the end of FY 2011.

    Question 15. Last year's budget included almost $800 million for 
specific programs to assist homeless veterans in continued efforts to 
reduce homelessness. Please provide detailed analysis of how this money 
was utilized in each of the various programs and what impact it had on 
the reduction of the number of veterans who are homeless.
    Response. The Department of Housing and Urban Development (HUD) 
recently released the Veterans Homelessness Supplemental Report to the 
2009 Annual Homeless Assessment Report (AHAR), which states there are 
75,609 homeless Veterans on a single night in January 2009. Our goal is 
to reduce the homeless population to 59,000 by June 2012. These 
reductions are attributable to the collective efforts of VA, the 
Department of Housing and Urban Development (HUD), our community 
partners and Congress.
    The $800 million represented the 2011 estimate in the FY 2011 
President's submission. In 2010, VA spent over $622 million in specific 
programs to assist homeless Veterans. An itemized list of the $622 
million is shown below. The breakout of spending by major category is 
as follows: Permanent Housing and Supportive Services, $71 million; 
Transitional Housing, nearly $285 million; Prevention Services, $11 
million; Treatment, nearly $176 million; Employment and Job Training, 
$61 million; and Administrative Costs, $18 million.

                             FY 2010 Actual
                         (Dollars in Thousands)
------------------------------------------------------------------------
                                                                  2010
------------------------------------------------------------------------
Permanent Housing/Supportive Services
  HUD-VASH case management...................................    $71,137
                                                              ----------
    Subtotal.................................................    $71,137
                                                              ----------
Transitional Housing
  Grant and Per Diem.........................................   $175,057
  Health Care for Homeless Vets (HCHV).......................   $109,727
                                                              ----------
    Subtotal.................................................   $284,784
                                                              ----------
Prevention Services
  Supportive Services Low Income Vets & Families (Exit)......     $3,881
  National Call Center for Homeless Veterans (NCCHV).........     $2,410
  Justice Outreach Homelessness Prevention Initiative........     $4,803
                                                              ----------
    Subtotal.................................................    $11,094
                                                              ----------
Treatment
  Domiciliary Care for Homeless Veterans.....................   $175,979
                                                              ----------
    Subtotal.................................................   $175,979
                                                              ----------
Employment/Job Training
  CWT/Vocational training....................................    $61,205
                                                              ----------
    Subtotal.................................................    $61,205
                                                              ----------
Administrative
  Other......................................................    $18,509
                                                              ----------
    Subtotal.................................................    $18,509
                                                              ----------
Grand Total..................................................   $622,708
------------------------------------------------------------------------


    The Department of Housing and Urban Development-VA Supported 
Housing (HUD-VASH) program provides permanent housing and ongoing case 
management treatment services for homeless Veterans who require this 
assistance to live independently. Cumulatively, HUD has allocated over 
30,000 ``Housing Choice'' Section 8 vouchers to Public Housing 
Authorities (PHA) throughout the country for eligible homeless 
Veterans. In FY 2010, this program enabled 20,101 Veterans to receive 
permanent housing.
    VA's Health Care for Homeless Veterans (HCHV) program provides ``in 
place'' residential treatment beds through contracts with community 
partners. It also provides VA outreach and clinical assessments to 
homeless Veterans who have serious psychiatric and substance use 
disorders. In FY 2010, HCHV supported a 12.5 percent increase in the 
number of Homeless Stand Downs held (217 in 2010 versus 190 in 2009). 
HCHV teams conducted 42,371 initial clinical assessments of Veterans 
nationally and established 44 new HCHV contracts providing more than 
1,300 community residential treatment beds. More than 90,000 Veterans 
were contacted through VA's outreach efforts, resulting in 3,519 
Veterans being provided community-based housing and residential care.
    VA's Grant and Per Diem (GPD) program funds community-based 
agencies that provide transitional housing or service centers for 
homeless Veterans. VA awarded approximately $41 million through this 
program to community-based agencies ($26 million in capital funds and 
$15 million in per diem awards), which operationalized an additional 
971 transitional housing beds nationwide; collectively, more than 
17,000 Veterans were housed in these programs during FY 2010.
    VA's Mental Health Residential Rehabilitation and Treatment 
Programs (MH RRTP) support the Domiciliary Care for Homeless Veterans 
(DCHV) programs, which provide homeless Veterans with 24 hour-per-day, 
7 day-per-week (24/7), time-limited, residential rehabilitation and 
treatment services that include medical, psychiatric, substance abuse 
treatment, and sobriety maintenance. This program targets homeless 
Veterans or those at risk for homelessness. MH RRTPs improved access to 
residential care as evidenced by the increased bed census from 66 
percent in FY 2005 to approximately 81 percent in FY 2010. This 
increase was achieved at the same time the average length of stay 
across programs decreased. With FY 2010 funding, five new 40-bed 
domiciliaries were authorized for a total of 200 new beds. By the end 
of FY 2010, VA supported 2,233 homeless domiciliary beds and provided 
residential, mental health and health care services to more than 8,445 
Veterans.
    VA offers two programs for justice involved Veterans: the Veterans 
Justice Outreach (VJO) and Healthcare for Reentry Veterans (HCRV). Both 
of these programs focus on homeless prevention efforts and link 
Veterans with health care services. Formally launched in 2009, VJO aims 
to prevent homelessness by providing outreach and linkage to VA 
services for Veterans at early stages of the justice system, including 
Veterans' courts, drug courts, and mental health courts. VJO is 
designed to avoid the unnecessary criminalization of mental illness and 
extended incarceration for Veterans by ensuring that eligible Veterans 
have timely access to VA mental health and substance abuse services 
when clinically indicated, and other services and benefits as 
appropriate. Using FY 2010 funds, VA hired 120 full-time VJO 
specialists across the country. Fifty (50) operational Veterans Courts 
were also established in FY 2010, and 5,849 Veterans received VJO 
services that year. The HCRV program is designed to address the 
community re-entry needs of incarcerated Veterans. HCRV's goals are to 
prevent homelessness, reduce the impact of medical, psychiatric, and 
substance abuse problems among Veterans undergoing community re-
adjustment, and reduce the likelihood of re-incarceration. In FY 2010, 
44 full-time HCRV specialists saw Veterans in 955 of the 1,319 prisons 
across the country. VA provided 9,622 incarcerated Veterans with 
reentry services in FY 2010, and since August 2007, more than 24,000 
have received assistance.
    VA's National Call Center for Homeless Veterans (877-4AID-VET) 
connects homeless Veterans, their families, and other interested 
parties with appropriate VA and community-based resources. This Center, 
co-located with VA's Suicide Prevention Hotline, began accepting calls 
in March 2010 and includes 30 staff members who provide 24/7 coverage. 
All staff are trained in crisis intervention for homelessness issues 
and mental health services or issues. By the end of FY 2010, VA 
received more than 18,000 calls from 14,000 identified Veterans; 8,500 
of these individuals were provided ``warm handoffs'' to medical centers 
for engagement in treatment and housing services.
    VA's new homeless prevention initiative, the Support Services for 
Veteran Families (SSVF) Grant Program, will establish and provide 
grants and technical assistance to community non-profit organizations 
to provide supportive services to Veterans and their families to help 
them maintain their current housing. This program was developed in FY 
2010, and the first applications from community providers will be 
reviewed in March 2011.
    The Substance Use Disorder (SUD) Enhancement Program is designed to 
provide SUD case management and services to homeless Veterans in the 
community. The end goal is to treat the Veteran's SUD, removing these 
obstacles to obtaining or maintaining housing. In FY 2010, VA funded 
146 SUD specialists in the HCVH and HUD-VASH programs. These 
specialists are providing SUD case management and services to homeless 
Veterans in the community to enhance access to care and opportunities 
for recovery.

    Question 16. In September 2010, VA's development of a new 
information technology procurement process for VA was halted. With the 
Secretary's vision for a more centralized and efficient acquisition 
process, what impact will the delay in replacing procurement software 
have on realizing this vision?
    Response. In early calendar year 2010, VA undertook an extensive 
re-evaluation of its financial management challenges, risks and 
critical priorities. The re-evaluation, which included consideration of 
available resources, the clean audit opinions on VA's financial 
statements for 11 years in a row and the relative low risk with 
maintaining VA's legacy financial management system for the foreseeable 
future, resulted in a decision by the Secretary to end the FLITE 
Program in favor of pursuing several other lower risk and less costly 
financial management improvement initiatives. The Department's goal of 
improving financial management remains unchanged, only the path has 
changed. As a result other smaller, less costly, flexible and agile 
financial management initiatives have been undertaken to strengthen 
internal controls and oversight, reduce operating costs, address 
improper payments and improve data and analysis. These initiatives will 
also set the stage for a lower-risk financial management system 
replacement in the future. To date these actions have helped to 
eliminate three financial material weaknesses and significantly 
improved internal controls over the processing of miscellaneous 
obligation transactions using form 1358.

    Question 17. In February 2011 the Government Accountability Office 
released a report critical of Virtual Lifetime Electronic Record 
(VLER). The report found the Departments of Defense and Veterans 
Affairs have failed to jointly articulate explicit plans, goals, and 
timeframes in creating a joint electronic health record. Please provide 
the Committee with itemized VLER expenditures for FY 2009, FY 2010, and 
FY 2011. Also, provide the Committee with the FTE allocated to the VLER 
project--by Department and by year--since the project was conceived. In 
addition, please provide the numbers of those employed through 
contractor support. Finally, please provide a progress report on each 
of the IT projects and pilots involved in fulfilling the President's 
vision of VLER.
    Response. The Virtual Lifetime Electronic Record (VLER) program has 
often been so closely linked to the Electronic Health Record (EHR) 
modernization initiative as to become synonymous. It is important to 
understand that VLER is closely aligned with but unique from the EHR 
initiative. VLER is an interoperable and communication environment 
whereby health, benefits and administrative information may be 
electronically accessed by every Servicemember, Veteran, and/or their 
beneficiary. The VLER environment is structured to support the secure 
exchange of health, benefits and administrative information between 
public and private partners. Health, benefits, and administrative 
information resides in many DOD and VA systems, including the 
electronic health record system and various personnel systems. VLER 
ensures that regardless of the information source, policies, 
regulations and, procedures are put into place to secure and protect 
the information accessed or exchanged, and the terminologies, 
definitions, and terms are clearly presented.
    The table below provides information on the FY 2009, FY 2010 
obligations and total FY 2011 budget dollars allocated for VLER related 
activities and the FTEs associated with this initiative. Contracted 
services are firm fixed prices so there is not a specific FTE for the 
contracted support. Support contracts are included in the non-pay 
dollars in the supporting table.

----------------------------------------------------------------------------------------------------------------
                                                                                                      VHA Budget
   Year          FTE (Auth/Filled)          Contract support (total)         IT Budget (non-pay)       (non-pay)
----------------------------------------------------------------------------------------------------------------
    FY09   EPMO: 0/0                      EPMO: NA                      NwHIN Adptor: $3.5M                   $0
           IT: 1/1                        IT: NA
           VHA: 2/2                       VHA: NA
----------------------------------------------------------------------------------------------------------------
    FY10   EPMO: 8/0                      EPMO: NA                      NwHIN Adaptor: $11.852M               $0
           IT: 40/9                       IT: NA                        IT Infrastructure: $7.113M
           VHA: 26/5                      VHA: NA                       VLER EPMO Support: $1.85M
                                                                        IT PMO: $4.506M
----------------------------------------------------------------------------------------------------------------
    FY11   EPMO: 8/6                      EPMO: NA                      NwHIN Adaptor: $31.761M           $11.7M
           IT: 46/10                      IT: NA                        Health Legacy: $23.716M
           VHA: 27/16                     VHA: NA                       Warrior Support: $20.623M
                                                                        IT PMO: $5M
                                                                        VLER EPMO Support: $2.4
----------------------------------------------------------------------------------------------------------------
EPMO--Executive Program Management Office (the VLER business sponsor PM office)
PMO--Program Management Office (the OI&T Product Delivery PM office)


    VLER will deliver the foundational clinical encounter data 
capability in July 2012. This foundational capability will be enhanced 
to support disability adjudication within the VA and in conjunction 
with the Social Security Administration (SSA) in December 2012. There 
are four joint pilots to achieve the initial health components of VLER. 
The initial health data exchange joint pilot with DOD and a private 
healthcare partner in San Diego went into operational status 
December 2009; the second pilot with expanded health data element 
exchanges achieved at Hampton Road/Tidewater, Virginia went into 
operation in September 2010; the third joint pilot planned to increase 
points of care and health elements exchanged is on target to go into 
operation in March 2011 in Spokane, Washington; and the fourth joint 
health pilot planned for September 2011 is on target to begin shortly 
at Puget Sound, Washington. Following a measurement and analysis phase 
for all pilots planned for October 2011 through March 2012, the 
implementation of VLER health capability VA-wide will begin in 
July 2012.
    Requirements, design and development of initial capability in 
support of the adjudication of VA disability claims has begun and is on 
target to provide health information exchange for use in benefits 
administration with initial capability by end of 2012. Additionally, a 
proof of concept demonstration is on target with SSA to begin in the 
first quarter of Fiscal Year 2012.

    Question 18. The office of OI&T is carrying over $675 million from 
FY 2011. How does VA plan to use this carryover? Please provide a 
specific listing of projects and the expenditure rate for each.
    Response. The carry forward funding from FY 2011 into FY 2012 is a 
planned $78M which will be used for Staffing and Administration. The 
carry forward funding from FY 2010 to FY 2011 was $675M. The complete 
listing of carry forward funding by program from FY 2010 to FY 2011 can 
be found starting on page 5B-1 of the Congressional Budget 
justification volume 2 of 4.
    OI&T faced a substantial challenge in IT when we started in 2009, 
assuming control of an organization that was failing to deliver on 
large IT projects costing hundreds of millions of dollars. Over the 
last two years, the Assistant Secretary for I&T has implemented a 
number of strong IT disciplines; disciplines aimed at correcting the 
delivery problems and increasing our capacity to deliver on 
transformational initiatives. These disciplined approaches are largely 
behind our recent successful delivery of the new software system to 
automate payments under the GI Bill.
    A side effect of those disciplines has been to eliminate spending 
on many programs we deemed ineffective, and slowing spending on most of 
our programs as we worked to ensure they were meeting their goals. The 
change has been dramatic. For example, under the Program Management 
Accountability System (PMAS), OI&T is now meeting over 80% of its 
software delivery milestones.
    However, the main purpose has been to build a strong IT capability 
that can reliably deliver the IT solutions we need to transform VA. We 
believe we have done that. The FY 2010 carryover funds of $675M into FY 
2011 will build the technology systems that will enable the 
transformation of VA; that will allow us break the back of the benefit 
claims backlog, and to implement further improvements to our medical 
automation systems.
    Projects are now reviewed to ensure they have a plan, defined 
business requirements, appropriate staff, etc. and then given seed 
money to ensure the plan can be executed. As such, all projects are now 
subject to the Project Management Accountability System.

    Question 19. The following questions relate to OI&T funding levels 
for VA's Major Transformative Initiatives:

    A. VBMS--please provide rationale for the proposed reduction below 
the FY 2011 level.
    Response. The proposed reduction in funding below the FY 2011 level 
is due to a decrease in system development activities in FY 2012. 
Development costs decreased by more than $50 million from FY 2011 to FY 
2012 while sustainment rates increased at a lower cost of $35 million. 
The majority of system capability is proceeding as scheduled for 
development and implementation as part of the FY 2011 funding stream. 
Funding for FY 2012 supports sustainment activities and the additional 
capacity for a national rollout of VBMS. A small amount is included for 
integration activities with other VBA benefit systems.

    B. GI Bill--given that there is no funding allocated for further 
development of requisite software, how does VA plan to fund any needed 
changes due, in part, to Public Law 111-377?
    Response. The new legislative requirements will be funded using FY 
2011 dollars originally targeted for additional system functionality 
and optional tasks on the SPAWAR interagency agreement. There is no 
negative budget impact for FY 2011.

    C. VLER--given the planned expansion of the program in FY 2012, why 
is the request for this initiative $13.5 million less that the FY 2011 
level?
    Response. The VLER Initiative continues on a steady course in FY 
2012 with additional interoperability enhancements while meeting the 
planned initial operating capability and enacting the national rollout 
to all VA medical centers as local health information exchanges are 
available. These efforts will be achieved within the funding requested.

    D. Improvements in Mental Health--please elaborate on the need for 
a doubling in OI&T funding for this initiative from FY 2011 to FY 12.
    Response. The increase in the OI&T budget for mental health 
improvements from FY 2011 ($5,900,000) to FY 2012 ($12,000,000) is 
based on increased project development costs in the Improving Veterans 
Mental Health operating plan. In conjunction with OI&T, mental health 
has a prioritized list of projects that must be completed to develop 
the Mental Health Informatics Infrastructure required to fully support 
the implementation of the Uniform Mental Health Services Handbook 
through projects that increase patient safety; allow collection of 
population-based outcome measures; and support development of Web-based 
patient-centered programming. In FY 2011, the operating plan initiated 
projects to improve better tracking of Veterans deemed to be at high 
risk for suicide, enhancements in tools to track outcomes, and Web-
based programming to allow Veterans to develop goals for treatment. FY 
2012 will continue the development of the FY 2011 projects, and 
commence the following projects:

     $2.25 million--Methadone Dispense Tracking
     $1 million--Development of patient oriented Web-based 
educational objects to support evidence-based therapy, using My 
HealtheVet--Op
     $1 million--Promoting Resilience and Prevention
     $0.5 million--National Clozapine Coordination

    E. VRM--the request for FY 2012 is $48.4 less than the FY 2011 
level. What functionality was realized in FY 2011 to justify the 
reduction?
    Response. A significant portion of the VRM FY 2011 budget is 
devoted to Voice Access Modernization. Most of this effort is scheduled 
to be completed in FY 2011. It is also anticipated that Identity Access 
Modernization (IAM) will complete a large portion of work in FY 2011, 
completing the remainder in FY12.

    F. Integrated Operating Model--given the proposed increase for IOM, 
what metrics will VA use to gage the impact of this program on VA's 
corporate functions?
    Response. The mission of the Integrated Operating Model (IOM) is to 
implement a management infrastructure that focuses on improving the 
integration and management across VA's departmental management 
functions. By improving the integration across its Acquisition, 
Construction and Facilities Management, Financial Management, Human 
Resources, and Information Technology functions, a well-managed and 
highly-effective VA corporate back office is better enabled to support 
the Administrations in enhancing direct service delivery to Veterans.
    The impact of IOM is gauged through metrics related to milestone 
deliverables and impact on operations. Example of deliverables and 
impact to date include:

    1. Acquisitions
          Implemented the Supplier Relationship Transformation (SRT) 
        Initiative. The Office of Acquisition, Logistics, and 
        Construction (OALC) developed two-way dialog with suppliers and 
        found many suppliers to be dissatisfied with VA's order 
        fulfillment processes. As such, OALC aimed to establish a more 
        effective relationship with VA's suppliers. By instituting 
        Perfect Order Fulfillment (POF), OALC enhanced the Department's 
        relationship with its vendors to deliver the right service or 
        product, at the right place, at the right time, with the right 
        quality and with proper documentation. Developing more 
        meaningful relationships with VA suppliers to achieve ``Best in 
        Class'' POF improved VA's internal capacity to serve Veterans, 
        their families, our employees, and other stakeholders 
        efficiently and effectively.
    2. Financial Management
          a. Implemented MyPay for all VA employees. The Office of 
        Finance (OF) successfully implemented MyPay, an enhanced self-
        service employee benefit portal, for all VA employees. MyPay is 
        an innovative, automated system that allows VA employees to 
        electronically manage certain discretionary pay data items and 
        allows them to view, print, and save Leave and Earning 
        Statements (LES) and W-2s. OF's implementation of MyPay, 
        allowed the Department to migrate from its legacy system, 
        Employee Express, resulting in the elimination of annual fee of 
        approximately $1,370,250. Since MyPay allows VA the ability to 
        completely eliminate hard copy LES, there is an additional 
        annual cost savings of approximately $1,287,000. MyPay enhances 
        the Department's ability to manage human capital and save money 
        that can be used for other purposes to serve Veterans.
          b. Trained 2,375 VA employees through various financial 
        management training venues in FY 2010. OF implemented an 
        ambitious plan to train VA's financial management workforce to 
        be better able to meet Federal appropriations, accounting, 
        internal controls, and improper payments requirements and 
        regulations. In one example, OF executed the August 2010 
        Financial Management Training Conference, which trained 1,311 
        employees, many of whom had never taken formal financial 
        management training. To evaluate the effectiveness of this 
        training, VA tested employees before and after training. The 
        result was a 43 percent increase in average scores after 
        training.
    3. Information Technology
          Implemented Program Management Accountability System (PMAS) 
        prototype and training. VA began implementing PMAS to manage 
        all IT development, modernization, and enhancement programs and 
        projects in order to increase the Department's accountability 
        for IT projects and minimize the impact of IT projects which 
        are either behind schedule or over budget. As a part of IOM, 
        the Office of Information and Technology (OI&T) implemented the 
        PMAS prototype that requires (1) an incremental development 
        approach requiring frequent delivery (every six months) of new 
        functionality to ensure customers' mission needs are met on 
        time and within budget and (2) a rigorous management approach, 
        involving customers, project staff, and vendors, accountable 
        for ensuring early identification and correction of IT program 
        milestones. To support PMAS, OI&T also implemented PMAS 
        training, developed and published a PMAS Guide, and finalized 
        draft requirements for a PMAS dashboard.
    4. Human Resources
          Implemented Direct-Hire Authority (DHA) for Acquisition 
        Positions. The Office of Human Resources & Administration (HRA) 
        implemented the use of DHA to fill critical GS-1102 
        (contracting) series positions in the Washington, DC 
        metropolitan area at grade level GS-12 through GS-15 or 
        equivalent. There is a shortage of highly qualified candidates 
        for contract specialists in the 1102 series that exists at VA 
        in the Washington, DC area. This impeded VA from recruiting 
        highly qualified candidates to fill critical acquisition 
        positions in VA, thus impacting VA's acquisition operations and 
        ultimately, Veterans. HRA worked with the Office of 
        Acquisition, Logistics, and Construction (OALC) and Office of 
        Personnel Management to implement this authorization and 
        greatly enhance OALC's ability to recruit acquisition 
        professionals.

    G. Health Informatics--while this is a relatively new initiative, 
what is the expected expense over the life of this program? How does VA 
see this application being used in the future to cut costs within VA?
    Response. Transforming Health Care Delivery through Health 
Informatics (Health Informatics) is a new VA Major Initiative 
(Initiative) that was formally launched on October 1, 2010. The purpose 
of the Initiative is two-fold: 1) assist with VHA's transition from a 
medical model of care to a patient-centered model of care; and 2) 
enhance collaboration between VHA and OI&T. The Initiative is the 
vehicle for promoting and fostering open, transparent communication 
between health care providers and software development teams through 
shared responsibility and accountability. The Health Informatics 
Initiative is composed of three major projects:

          1. Establish a Health/IT Collaborative Supporting Rapid 
        Product Development and Delivery. This effort restructures the 
        working relationship between VHA and OI&T and provides an 
        organizational foundation for reengineering existing processes 
        and piloting VHA clinical software prototypes in a rapid, agile 
        and iterative fashion.
          2. Create a Health Management Platform to Transform Patient 
        Care. This effort integrates informatics and health information 
        technology (IT) in the delivery of health care. It provides a 
        succession plan to transition the Computerized Patient Record 
        System (CPRS) to the next generation of browser-based 
        Electronic Health Record (EHR).
          3. Build Health Informatics Capacity. This effort develops 
        the Health Informatics workforce and enhances organizational 
        informatics literacy through competency, career and community 
        development.

    The Health Informatics Initiative total lifecycle costs are 
estimated to be $41.6 million over the 3-year life of the Initiative, 
after which business functions will be integrated into VHA's Office of 
Informatics and Analytics (OIA). The funding will support the 
establishment of cross-cutting health informatics tools designed by 
health professionals to optimize performance in terms of quality, 
efficiency and increased job satisfaction, to encourage and facilitate 
increased patient and family engagement in care and decisionmaking, and 
support population and evidence-based care focused on preventive health 
care and chronic disease management.
    The Initiative will develop a predominantly Web-based Electronic 
Health Management Platform enabling contributions from other software 
development sources. Additionally, it will establish a sustainable 
workforce capacity to support healthcare modernization and improved 
care delivery. The workforce capacities component will build on agency 
successes with continued development of curriculum, delivery of 
coursework and assessment of coordination strategies amongst health 
informaticists.
    Building upon the award winning quality and cost-savings 
improvements of VA's Electronic Health Record CPRS, the Health 
Informatics Initiative has reassembled the CPRS team to take the next 
evolutionary step--creating Web-based, standards-compliant, extensible 
Health Management IT Platforms for:

     Health Care Teams: Modules that are health care team-
driven to decrease cognitive load, effectively manage relationships 
between conditions, interventions and observations, acquire data 
(including documentation) as a by-product of workflow and ultimately 
support higher quality, safe patient care and clinician satisfaction;
     Veterans: Solutions that achieve meaningful patient use, 
population reach and impact, giving Veterans more responsibility and 
control over their own health care; and
     Systems: Products that look across VA's IT systems and 
patient populations to improve health care delivery and system 
performance.

    According to a recent independent study,\1\ reductions in 
unnecessary care from current VA IT systems will result in an estimated 
savings of $4.64 billion. Initiative products and outcomes will expand 
these savings by: 1) providing better team-based coordination of care 
to Veterans, reducing costs from complications due to poor coordination 
(redundant laboratory tests and medications orders, adverse drugs 
interactions and reactions), 2) implementing comprehensive, integrated 
decision support across all patient data sources to reduce diagnostic 
errors and associated costs as well as medication errors and over-
prescription, 3) engaging patients in their own care resulting in fewer 
hospital admissions and clinic visits as well as more effective ``self-
treatment'' (such as diabetes and blood pressure control), 4) providing 
the framework for VA population-wide epidemiological studies to enable 
VA researchers to identify patterns between diseases, outcomes and 
treatments leading to more proactive and less costly Veteran care, and 
5) allowing real-time visibility into IT systems with transparency 
across the enterprise with regard to managing patient-health system 
interactions (e.g. waits and delays, flow, etc.), patient-staff 
relationships (e.g. handoffs) and tests and procedures.
---------------------------------------------------------------------------
    \1\ Byrne, et al. The Value From Investments In Health Information 
Technology At The U.S. Department Of Veterans Affairs. Health Affairs; 
April 2010.

    Question 20. Please account for the decrease in overall funding in 
the President's request, by business line, for the Veterans Benefits 
Administration in the General Operating Expenses Account.
    Response. The decrease in the compensation and pension budget 
request is due to plans by the Veterans Benefits Administration to 
realign $75 million in FY 2011 from personal services and from one-time 
items within the other services category for exploration of 
alternatives to FTE to address the backlog. This contractor funding is 
not continued in the FY 2012 request.
    Also affecting the C&P decrease in FY 2012 is a reduction in 
funding for one-time needs (e.g., training, supplies) for the 
additional hires that were funded in FY 2011.
    The Education budget request decreases due to the implementation of 
the automated long-term claims processing solution for the Post-9/11 GI 
Bill, which will decrease VBA's reliance on FTE. Education's FTE 
request decreases by 366 in FY 2012.

    Question 21. Given the increased reliance on contract services in 
VR&E, please comment on the FTE dedicated to management and oversight, 
as well as the costs associated with the contract services as 
envisioned in the President's budget.
    Response. VR&E Service is working to decrease reliance on contract 
services through increased staffing. VA was able to redirect funding 
requested for contracts under the FY 2011 budget level to support VR&E 
staffing increases, and additional staffing increases are included in 
the FY 2012 budget request. The FY 2012 budget includes $4.4 million 
for contract counseling services. Nationwide, 28 contract specialists 
support contract oversight. VR&E Officers serve as Contracting Officer 
Technical Representatives (COTRs).

    Question 22. To adequately staff the VR&E program, what is the 
target case load per caseworker and is VA currently meeting this goal 
at each regional office? Please provide a detailed discussion of the 
resources needed to meet this goal and comment on the estimated number 
of total FTE needed.
    Response. VR&E Service is currently evaluating optimal performance 
in relation to workload through a work measurement study. The study is 
anticipated to be complete by the 3rd quarter FY 2011. Study 
deliverables include a model for optimal staffing projections. It 
should be noted that some regional offices rely on contract services to 
supplement staffing levels. Stations that rely on contract services 
would tend to have higher caseload ratios. The current nationwide 
average ratio is 134 Veterans per counselor.

    Question 23. The President's budget increased Chapter 31 funding by 
$32 million from FY 2010 to FY 2011. During the same time, there was an 
increase of 3,645 new VR&E recipients. The FY 2012 budget calls for a 
$37 million increase over FY 2011, but estimates just 1,860 new users. 
Please explain why there is a higher budget request given that VA 
estimates lower utilization.
    Response. Funding levels related to the payments to Chapter 31 
beneficiaries are driven by several factors. Chapter 31 assists 
Veterans with service-connected disabilities to prepare for, find, and 
keep suitable jobs as well as achieve independence in daily living. The 
total increase in chapter 31 obligations is $36.4 million from 2010 to 
2011. The Cost of Living Adjustment (COLA), an economic assumption 
applied to prior year average costs, is expected to increase 
obligations by $32.9 million. An increase in subsistence allowance 
trainees yields a $4.8 million increase in program costs. The average 
cost unrelated to the COLA decreases slightly for subsistence allowance 
and/or tuition, books, and supplies, which decrease obligations $1.3 
million.
    The increase in chapter 31 obligations is expected to be $42.6 
million from 2011 to 2012. The COLA is expected to increase obligations 
by $35.4 million. A rise in caseload for those trainees receiving 
subsistence and/or tuition, books, and supplies is expected to increase 
obligations by $7.3 million. Average payment unrelated to the COLA will 
decrease slightly, lowering obligations by $78 thousand.

    Question 24. Please provide the cost--for both the current and next 
fiscal year--of disability examination contracts to support the 
Integrated Disability Evaluation System. Please provide the costs to 
VBA and VHA separately.
    Response. VHA began the acquisition process for a potential 
contract vehicle to supplement required disability examinations and 
released a Request for Proposals for disability examination services. 
VA has received submissions from several bidders and is currently 
reviewing the submissions, but no final determination or selections 
have been made at this time. The solicitation documents did not specify 
certain minimum task order amounts, and it is possible that there will 
be more than one award made. Since this acquisition is still in the 
evaluation stage, it is not possible to provide a cost estimate for 
VHA.
    Estimated costs for VBA are $13 million in fiscal year 2011 and $20 
million in fiscal year 2012. If additional IDES sites are added to the 
contract, the cost will increase. The current estimated cost for IDES 
examinations is approximately $1,000 per examination.

    Question 25. VA has announced an expansion of VR&E's mission to 
include IDES and the ``Veterans Success on Campus'' programs. Please 
describe the role VR&E counselors would fulfill in each of these 
programs, their anticipated workload, and the number of FTE that will 
be needed to staff these programs.
    Response. IDES--This initiative will provide VR&E outreach and 
transition services to active duty Servicemembers transitioning from 
military to civilian life through the IDES system. These on-base 
services will include one mandatory counseling appointment with a 
Vocational Rehabilitation Counselor, as well as services ranging from a 
comprehensive rehabilitation evaluation to determine abilities, skills, 
and interests for employment purposes to case-management services to 
assist Veterans to identify and maintain employment and achieve a 
successful transition to a civilian career. VR&E will use 110 new FTE 
in the IDES process to help approximately 12,000 Servicemembers by 
providing the aforementioned services.
    The VetSuccess on Campus (VSOC) program supports Veterans' 
transition from military to campus life. Veterans attending college, 
including those using the Post-9/11 GI Bill or other VA education 
benefits, are provided with a wide range of rehabilitation and personal 
adjustment counseling services, including referrals to VA medical 
facilities as needed. VSOC staff also provide assistance with general 
benefits issues and can assist with peer counseling and mental health 
referrals. The VSOC program is currently operating on 8 campuses. The 
budget requests supports 9 additional FTE to target 9 more campuses, 
providing an estimated 9,000 Veterans with on-campus benefits 
assistance and adjustment counseling.

    Question 26. How will VA determine eligibility for VR&E services 
among those going through IDES?
    Response. The first step in the Vocational Rehabilitation and 
Employment (VR&E) process is to evaluate the Servicemember's 
eligibility. Servicemembers must meet the following criteria: have 
received, or will receive, a discharge that is other than dishonorable; 
have a service-connected disability rating of at least 10 percent; and 
must complete an application for VR&E services. The basic period of 
eligibility in which VR&E services may be used is 12 years from the 
date of separation from active military service, or the date the 
Veteran was first notified by VA of a service-connected disability 
rating, which comes later.
    Servicemembers going through IDES are eligible for VR&E services if 
they expect to receive an honorable discharge from active duty and if 
they obtain a memorandum rating or IDES proposed rating of 20% or more 
when referred to the Physical Evaluation Board (PEB). All IDES 
participants will receive a mandatory initial counseling session in 
which a VR&E counselor will work with the separating Servicemember to 
determine whether and how further program participation can benefit 
them in their transition process.

    Question 27. Employee training is one of the most crucial efforts 
VA can put forth to improve the quality and timeliness of claims 
processing. What is provided in the budget for training of C&P staff? 
Please provide a breakdown of the types of training that will be 
provided.
    Response. The FY 2012 budget request for VBA's Office of Employee 
Training and Development includes $12.9M for training of C&P personnel. 
This funding supports entry-level training for new claims processors, 
on-line training for new and experienced claims processors, nationally 
standardized lesson materials for local delivery to experienced claims 
processors, and electronic performance support systems to accelerate 
claims-processing decisions.

    Question 28. The President's Budget request makes note of a claims 
transformation plan and systemwide transformation that will expand 
quality review procedures. Please describe these initiatives in detail.
    Response. In support of the Secretary's commitment to eliminate the 
claims backlog and improve quality to 98% by 2015, VA has undertaken a 
comprehensive Transformation Plan focused on providing timely and 
quality service to Veterans.
    Specialized quality review positions are being created in each 
Regional Office to focus on the improvement of quality. Employees in 
these positions will form part of a dedicated quality review team. The 
members of this team will attend training provided by the C&P Service 
quality assurance staff to enhance consistency between national and 
local quality reviews.
    Additionally, logic-based tools are being developed to aid VA 
decisionmakers and improve consistency and accuracy. Tools to support 
disability evaluation calculations for hearing loss and entitlement to 
special monthly compensation have been implemented nationwide, and 
development of additional tools is underway.

    Question 29. The President's Budget request states that there are 
an increasing number of Individual Unemployability cases. Please 
describe any identifiable trends in the caseload and any explanation 
for these trends.
    Response. The number of veterans receiving Individual 
Unemployability (IU) benefits increased by 5.2% between 2009 and 2010. 
The increase was 4.2% between 2007 and 2008, and 4.4% between 2008 and 
2009. VBA expects a continued increase in FY 2011 and FY 2012 as the 
number of Veterans receiving compensation is projected to increase. VBA 
completed 10.2% more claims in FY 2010 than in FY 2009 (1,076,983 vs. 
977,219), and it is reasonable to conclude that this also included 
additional grants of compensation based on unemployability.

    Question 30. Given the pending reorganization of VBA, which 
includes the creation of a new business line for pension and fiduciary, 
how will the FY 2012 budget be affected by the planned changes?
    Response. The FY 2012 budget includes funding requirements for 
Compensation and Pension (C&P) Service. Those funds also support the 
fiduciary activities of the VA. Since staffing for new Pension and 
Fiduciary Service will come out of existing C&P Service and VBA 
staffing, it will not impact the FY 2012 budget

    Question 31. The budget submission notes that the funding level for 
education benefits do not reflect the changes made by Public Law 111-
252, the Post-9/11 Veterans Educational Assistance Improvements Act of 
2010. However, the General Operating Expenses account for education 
projects a decrease of $29.1 million that is based in part on the need 
to incorporate changes made by the new public law. Are you satisfied 
that you will have sufficient FTE to support the changes made in the 
program and that timeliness and accuracy will not be adversely 
impacted?
    Response. Public Law 111-377, the Veterans Educational Improvements 
Act of 2010, modifies certain aspects of the Post-9/11 GI Bill, with 
most modifications effective on August 1, 2011. The enactment of this 
law has impacts the development of the Long Term Solution (LTS) for 
processing Post-9/11 GI Bill claims and our ability to fully automate 
the delivery of benefits. The capability to conduct automated end-to-
end processing on some supplemental claims was tentatively planned for 
June 2011. This capability would create a subset of claims that do not 
require manual intervention. Implementation of the LTS was expected to 
address the increased workload and improve claims processing timeliness 
while negating the need for temporary claims processors. Because all 
efforts will not be directed to implementing the changes in the new 
law, we now anticipate this functionality will not be available until 
the third quarter of FY 2012. The delay in the implementation of the 
enhanced functionality planned for the LTS affected the number of FTE 
needed to process education claims. Our budget request of 1,429 FTE 
reflects the need to retain 324 of the 530 temporary claims examiners 
through FY 2012 to maintain current claims processing efficiencies.

    Question 32. VA's most recent 10-year action plan for construction 
notes that full implementation of Strategic Capital Investment Planning 
(SCIP) would require between $53 and $65 billion for capital 
infrastructure costs to remediate identified gaps. Please explain VA's 
strategy to deal with the construction backlog, including planned 
expenditures over the ten years.
    Response. The 2012 10-year Capital Plan identified between $53B-65B 
in magnitude estimate costs to close Departmental gaps over 10-years. 
This estimate includes $4.1B needed to complete all existing partially 
funded major construction projects. Each year, VA determines which 
partially funded projects to fund based on the projects' original 
priority score, ability to obligate, and available funding. The total 
level of capital resources is reassessed each year in the annual budget 
process, where hard choices are made balancing between operating costs 
and capital needs.
    In addition, VA will continuously assess the need for projects 
based on space, condition, access, safety, and utilization/workload 
gaps and determine the best methods to resolve these gaps. Annual 
updates of the 10-Year Action Plan will help to track the progress of 
approved and in-process capital projects and their impact on gaps. The 
10-Year Action Plan will inform decisions on the most critical gaps to 
address and the best method to address those gaps. In addition to the 
Department's three construction programs--major construction, minor 
construction, and non-recurring maintenance--it also relies on leasing 
and a variety of non-capital solutions to resolve gaps. Tele-health 
care, contract care, extending hours of operations, sharing agreements, 
mobile clinics, virtual call centers, telecommuting, and enhanced-use 
leasing (EUL) are examples of non-capital solutions that are employed 
to address gaps.

    Question 33. Please provide the mathematical formula used to arrive 
at the ``total score'' used to prioritize funding decisions under SCIP.
    Response. Capital projects are scored by the SCIP Panel, which is a 
sub-group of the SCIP Board and comprised of representatives from 
across the Department. The SCIP Panel and Board work within the VA 
Governance process, which provides a framework within which the SCIP 
process functions and culminates with the selection of capital projects 
for inclusion in the annual budget request. The structure of governance 
begins with the SCIP Board and proceeds through the Strategic 
Management Council/Senior Review Group (SMC/SRG) to the Veterans 
Affairs Executive Board (VAEB), with an increasing level of authority 
at each step. The SMC/SRG is chaired by the Deputy Secretary and is 
comprised of senior management representatives from across the VA. The 
final level in the VA Governance process is the VAEB, which is also a 
cross-Departmental group of senior management officials and chaired by 
the Secretary.
    The decision methodology used to score projects is the Analytic 
Hierarchy Process (AHP). The AHP provides a structure, or ``model,'' to 
determine which projects contribute the most to addressing Departmental 
priorities. The SCIP decision model is comprised of the major criteria, 
sub-criteria, and their priority weights. Each project is scored on how 
well it addresses the each sub-criterion. The total score of a project 
is calculated by multiplying the project's ``score'' for each sub-
criterion by the priority weight of the sub-criterion and then by the 
priority weight of the major criterion. Each sub-criterion ``score'' is 
the average of the rating (on a scale of 0 to 1) chosen by the scoring 
participants. A project's ``Total Score'' is the sum of the weighted 
scores for each sub-criterion.

[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]


    This is simplified illustration; priority weights, ratings, and the 
resulting total score are fictitious. The 2012 SCIP decision criteria 
model consists of six major criteria and 18 sub-criteria. Each capital 
project was scored by SCIP Panels based on that project's contribution 
to each of the 18 sub-criteria. The calculation shown above would be 
done 18 times (once for each sub-criterion) and those 18 totals would 
be summed to calculate the total combined score. The scoring process is 
supported by the use of decision support software to record the 
participant's ratings and calculate the total combined scores.
    More information on the 2012 decision criteria and the scoring 
process can be found in the FY 2012 Budget Submission, Construction and 
10-Year Capital Plan, Volume 4 of 4, February 2011, which can be found 
at http://www.va.gov/budget/products.asp, pages 10-3, 10-5, and 8.2-1.

    Question 34. As one of the largest real-property holders in the 
Federal Government, VA has 5.7 million vacant square feet. Knowing of 
the difficulties involved in disposing of unused or underutilized 
property, and the challenges present when attempting to repurpose a 
building, what is VA's strategy for right-sizing its capital asset 
inventory?
    Response. Significant reductions in vacant space have already 
occurred, as the VA has reduced its inventory of owned vacant space by 
34 percent, from 8.6 million square feet in 2001 to 5.7 million square 
feet in 2010. This 5.7 million vacant square feet accounts for less 
than 4% of the VA's real property inventory. VA continues to 
aggressively pursue reuse or disposal of assets in our inventory that 
are deemed un-needed. This, along with improvements in the capital 
planning phase contributes, to right sizing our capital inventory. VA's 
strategy encompasses the following elements:

          1. Improving space planning for the long term--As a component 
        of the VA's new Strategic Capital Investment Planning (SCIP) 
        process, a detailed space analysis is performed. This analysis 
        targets long term needs, allowing facilities to plan well in 
        advance for the potential reuse or disposal of property. This 
        long term planning utilizes future workload projections as a 
        major input, ensuring that the services rendered to our 
        Veteran's are not impacted by infrastructure challenges. By 
        planning for potential unused space in out years, VA hopes to 
        avoid adding vacant space to its inventory.
          2. Advocating for internal and external reuse--Although 
        reusing properties presents challenges, it is a valuable option 
        to VA and Veterans by providing needed services, such as 
        Homeless housing, and allowing VA to transfer the financial 
        liability of unused property through Enhanced-Used Leasing 
        (EUL). This legislative authority is scheduled to lapse at the 
        end of calendar year 2011. The Administration remains committed 
        to this important program, and a proposal to address the 
        expiration will accompany the Department's legislative package 
        submitted through the President's Program. VA continues to 
        expand opportunities for reuse, including EULs, identifying 
        collocation opportunities among VA's Administrations, sharing 
        of space and/or services with DOD, and additional public/
        private partnerships. Reuse also encompasses the renovation of 
        space to be repurposed to directly serve our Veterans, which is 
        also stressed as part of the SCIP process.
          3. Disposing of assets--The disposal of assets is often 
        necessary when the age, condition, and campus location 
        buildings make them poor candidates for reuse. The major 
        challenges faced when disposing of property are historic 
        considerations and abiding by all necessary Historic Property 
        laws. Improvements can be made to address those challenges, 
        such as early engagement of the VA's Historic Preservation 
        officer in the planning phases of the SCIP process to ensure 
        due diligence, identification of reuse opportunities, and 
        coordination with the preservation office to ensure proper 
        documentation is in place well before the actual disposal is 
        planned. VA expects the end result is a more efficient and 
        effective disposal process.

    Question 35. Please provide an estimate of the cost avoidance 
achieved by the implementation of VA's green management program.
    Response. Starting in 2008 and for approximately the next 25 years, 
VA's green management program projects implemented awarded through 2012 
will have an estimated total avoided costs of $892.5M with an estimated 
annual cost avoidance of $56.1M. The cost-avoiding green projects VA 
plans to award in FY 2012, avoidance of $12.8 million annually, is 
estimated over each of the next four to 25 years. These estimates 
combine cost avoidance due to projects of varying lifetimes, such as 
renewable energy systems that last more than 25 years, air conditioning 
system upgrades that last an average of 15 years, and building systems 
retuning that provides cost savings persisting for four years. The 
level of cost avoidance experienced will depend primarily on how energy 
prices fluctuate over the lifetime of each project.

    Question 36. In FY 2011, funding for the housing account was 
slightly over $1.4 million. However, for FY 2012, the funding is only 
$319,000. Please explain this decrease.
    Response. The mandatory funding in the Housing Program Account 
includes the loan subsidy estimate for new loans, which includes loans 
made in the budget year (FY 2012), and the reestimate of loan subsidies 
for all existing loans, which includes all outstanding loans made prior 
to the budget year.
    The FY 2011 funding of $1.4 billion represents both the loan 
subsidy estimate for new loans and the reestimate of loan subsidies for 
all existing loans. The 2012 figure represents only the loan subsidy 
estimate for new loans.
    The two years are subject to different estimation techniques and 
timelines. The loan subsidy estimate for new loans is based on current 
economic assumptions and is included in the 2012 budget request. 
However, the reestimate of loan subsidies for all existing loans is not 
completed until after the close of a fiscal year. The reestimate will 
be completed in November 2011, in accordance with the OMB Circular A-11 
and the Federal Credit Reform Act of 1990, and sent to Congress in the 
2013 Budget Submission.

    Question 37. The budget request notes that 147 Native American 
Direct Loans are anticipated to be made in FY 2011. However, the Agency 
estimates that it will make just 60 loans through this program during 
FY 2012. Please explain the disparity between the two numbers.
    Response. The FY 2011 estimate of 147 Native American Direct loans 
(NADLs) reflects increased refinance loan activity due to the 
historically low interest rate environment of the past few years. When 
interest rates started dropping in FY 2009, NADL refinance activity 
increased as Native American Veteran borrowers took advantage of the 
opportunity to lower the interest rate on their home loans. VA 
experienced increased NADL refinance activity in FY 2009 and FY 2010, 
and VA expects this number to begin tapering off in FY 2011 as interest 
rates increase. As interest rates are expected to continue to increase, 
the number of NADL refinances is expected to decrease, lowering NADL 
activity to approximately 60 loans in FY 2012.

    Question 38. The President's FY 2012 budget estimates a savings of 
$200 million in the area of fee care savings. Please provide details on 
each of the elements included within this proposal.
    Response. VA has developed a plan in FY 2011 of cost savings 
estimates; this plan is the basis for our estimates for the FY 2012 
cost savings. The elements include business process changes and the use 
of additional fraud, waste and abuse tools to avoid improper payments. 
Specifically, VA developed cost initiatives including decreased 
duplicate claims payments, increased use of re-pricing contracts (which 
allow VA lower prices for services), increased possible Medical Care 
Collections Fund (MCCF) collections for purchased services, and 
decreased interest charges applied due to delay in processing of these 
health care claims.

    Question 39. The President's FY 2012 budget estimates a savings of 
$355 million by improving acquisitions in five target areas. Please 
list specific and separate examples where VA has identified real 
savings in each of these eight areas: Consolidated Contracting, 
Increased Competition, a return to In-House Contracting, Reverse 
Auction Utilities, MED PDB/EZ Save, Reduce Contracts, Property Re-
utilization, and Prime Vendor.
    Response. The following is a list of examples where VHA has 
identified real savings in the eight areas identified in the question:

          1. Consolidated Contracting--VISN Chief Logistics Officers 
        track previous pricing paid for supplies and services and 
        compare those rates to current pricing to determine savings. In 
        some cases, the vendors provide additional information on 
        savings related to the achievement of tiered pricing discounts. 
        The majority of savings in this category are attributable to 
        Blanket Purchase Agreements (BPA) that provide discounted 
        tiered pricing at the VISN or Regional level, and national 
        contracts at the program office level.
          2. Increasing Competition--VISN staff members determine 
        either the amount previously paid when procuring similar 
        services competitively or they utilize the government estimate 
        to calculate the savings. Savings in this category primarily 
        come from construction contracts that have been converted from 
        sole source to competitive.
          3. Bring Contracting Back into VA--VISNs report the dollar 
        amount of Army Corps of Engineers fees no longer being paid.
          4. Reverse Auctioning VISN/Facility Utilities--VISNs obtain 
        utilities savings from the General Services Administration 
        (GSA).
          5. MED PDB/EZ Save Methodology--VISNs use the MED/PDB pricing 
        data to determine the most favorable price and then calculate 
        the difference between the old price and the new price to 
        determine savings. This initiative is applicable to medical and 
        surgical supplies.
          6. Reducing Unnecessary Contracts--The contract cost 
        avoidance is manually tracked and reported by VISN. One example 
        is the cancellation of clinical contracts by hiring in-house 
        staff.
          7. Re-Utilizing Excess Property--VISNs calculate the dollar 
        value of the avoided procurement as the contract savings.
          8. Prime Vendors Charge Us Only the Discounted Price--VISNs 
        manually calculate the dollar amount of price reductions and 
        also calculate savings related to inventory reduction.

    Question 40. VA plans to achieve lower unit pricing by 
consolidating contracting. Please explain how the Secretary's vision 
for the future of VA acquisitions will encourage lower unit pricing.
    Response. On April 27, 2010, Secretary Shinseki approved an 
Executive Decision Memorandum to implement a new acquisition model for 
VA. Implementation of this new model enables VA to take a disciplined 
and collaborative approach in resolving the root causes of acquisition 
deficiencies; allows for the consolidation of complex, high-dollar 
value procurements under a single organization, thereby positioning VA 
to better leverage its acquisition spend. Critical to this acquisition 
business model is establishment of VA's Strategic Acquisition Center 
(SAC) within the Office of Acquisition, Logistics, and Construction 
(OALC), to implement strategic sourcing initiatives and handle 
contracting requirements exceeding field purchasing parameters. VA is 
pushing toward this future model with by taking actions now. For 
example, VA has committed 100% of its purchasing power to the new 
strategically sourced General Services Administration (GSA) Federal 
Supply Schedule Office Supply contract which offers tiered discounts 
and provides savings averaging 7-19% less than GSA schedule prices. 
Additionally, VA is identifying and developing business cases for 
strategic sourcing opportunities. Once fully operational, by spring of 
2012, the SAC will centralize execution of these business cases that 
will likely lower unit prices and improve quality.
                                 ______
                                 
  Response to Posthearing Questions Submitted by Hon. Patty Murray to 
                  U.S. Department of Veterans Affairs
                              health care
    Question 1. The budget submission proposes to realign clinical 
staff to get to a $150 million savings--by cutting physicians and 
registered nurses and replacing them with other clinical positions. 
What positive changes will be evident at an average facility after this 
change?
    Response. The Team Care model supports each professional working at 
the ``top of his/her professional skills and abilities'' to provide 
health care that is optimally safe and cost-effective. There will be no 
``cuts'' but, through attrition, we will replace some physicians with 
non-physician providers (nurse practitioners and/or physician 
assistants). Registered nurses will be supplemented by licensed 
practical nurses and other allied health support staff (pharmacists, 
social workers, dieticians and others) to further enhance the 
effectiveness of the team. This model will promote the provision of 
accessible, comprehensive, continuous and coordinated high quality 
health care while judiciously utilizing resources.

    Question 2. One of the problems at the Marion, Illinois VA was a 
provider performing procedures for which he was not qualified or 
credentialed. If this realignment proceeds, what will the Department do 
to ensure only the right providers are giving care and that they are 
appropriately credentialed for those procedures?
    Response. Since 2007, VHA has focused attention on the roles and 
responsibilities of local hospital medical staff leadership to ensure 
proper documentation and provider competency in the credentialing and 
privileging process, and has facilitated closer oversight by 
implementing continuous monitoring of credentials through the National 
Practitioner Data Bank's Continuous Query (previously known as the 
Proactive Disclosure Service). The new Central Office realignment will 
extend these efforts by bringing the Credentialing and Privileging 
program together with the National Center for Patient Safety, Risk 
Management, and the Office of Medical Legal Affairs, thereby enhancing 
internal communication and collaboration to ensure that only 
appropriately qualified clinicians are delivering care to our Nation's 
Veterans.

    Question 3. The budget submission predicts $200 million in savings 
in the next two fiscal years after a variety of initiatives to cut the 
costs associated with buying care in communities. One of the 
initiatives is to decrease the average daily census at contract 
hospitals. How will you ensure that veterans can receive timely access 
to care close to their homes?
    Response. Monitoring and assessing Non-VA Bed Days of Care was one 
of many initiatives associated with potential savings in this program. 
The intent of this component of the initiative was to provide broader 
oversight for both the inpatient care services where VA refers the 
Veteran as well as the emergent inpatient services that are initiated 
by the Veteran. It is not intended to limit access but to assure that 
we are purchasing inpatient care at the right time and the right 
location. VA is also assessing timeliness of appropriate transfers back 
to the VA. Each component of this initiative includes a clinical 
assessment to assure we have neither impacted access nor underutilized 
VA facilities.

    Question 4. The budget submission states that most networks have 
implemented 90 percent of the Uniformed Mental Health Services 
Handbook. When does the Department anticipate all networks being 100 
percent complete? Are there networks that currently are significantly 
below percent complete?
    Response. To date, the rate of implementation of the Uniform Mental 
Health Services Handbook across networks is 91.68 percent. Currently, 
two VISNS have more than 95 percent implementation, sixteen VISNS are 
between 89 and 95 percent implementation, and three VISNs are between 
83-89 percent implementation. While Veterans Health Administration 
(VHA) recognizes that 100 percent implementation of the Uniform Mental 
Health Services Handbook is a goal, VHA has set an internal standard of 
95 percent implementation at 100 percent of VA facilities. This is a 
more realistic, achievable goal, as these objectives are moving targets 
due to staff turnover and changing needs of the Veterans we serve. Of 
note, implementation rates of the Uniform Services Handbook have 
increased steadily over time, with national implementation rates 
increasing 5.8 percent between August 2009 and June 2010. While some 
networks are below others in terms of implementation rates, the Office 
of Mental Health Services, the Office of Mental Health Operations, and 
the Improve Veterans Mental Health Initiative provide technical 
assistance to ensure that all networks achieve at least 95 percent 
implementation by second quarter, Fiscal Year 2012.

    Question 5. A January 2009 VHA report found that over 49 percent of 
veterans returning from the Middle East and Southwest Asia who have 
sought VA health care were treated for symptoms associated with 
musculoskeletal ailments. Additionally, according to a recent VHA 
analysis of VA health care utilization among OEF/OIF veterans, 
musculoskeletal system and connective system diseases were the leading 
possible diagnosis, totaling more than 53 percent. Chiropractic 
services are available in at least one facility per VISN. However there 
are more than 120 facilities without a doctor of chiropractic medicine 
on staff and a few major metropolitan areas such as Detroit, Denver, 
and Chicago, without a doctor of chiropractic medicine in close 
proximity. What action is being taken to further accommodate the 
increasing number of Servicemembers in need of such care?
    Response. VA currently provides chiropractic services on-station at 
43 facilities, of which 7 are CBOCs. When the residence of a Veteran is 
geographically distant from a VA site providing on-station chiropractic 
care, the fee-basis program is utilized. VA continues to assess 
utilization and resources to further develop the chiropractic program 
to best serve Veterans' needs, expanding the VA chiropractic program 
from 24 sites in fiscal year 2005 to 43 sites in current fiscal year 
2011.

    Question 6. The President's budget request includes $52 million for 
FY 2012 and a FY 2013 advance appropriation of $57 million to fund care 
for American Indian/Alaska Native Veterans. How did VA arrive at these 
funding amounts?
    Response. VA had previously received population and cost of care 
information from the Office of Management and Budget for the American 
Indian/Alaska Native (AI/AN) Veterans. The $52 million and $57 million 
requests were based on an estimate of the AI/AN Veterans that were 
Indian Health Service (IHS) users only and dual eligible users to get 
total potential VA cost. Based on the data provided by OMB, the 
following assumptions were made:

     Only IHS cost for care provided in non-IHS facilities 
would be shifted to VA.
     The OMB IHS cost per user was $4,386 in FY 2012 and $4,710 
in FY 2013.
     25% of dual eligible AI/AN Veterans in given year will use 
IHS only and 50% of the IHS cost would shift to VA.
     50% of dual eligible AI/AN Veterans in given year will 
split VA/IHS care 50/50 and 25% of IHS cost will shift to VA.

    Question 7. The contingency fund that is included in the budget 
request raises several concerns. If the models project a given level of 
need, why does the request not ask to be directly funded at that level?
    Response. The $953 million contingency fund was requested to 
address the potential demand increase for medical care services due to 
changes in economic conditions, which was estimated for the first time 
in the VA's Enrollee Health Care Projection Model. Recent studies have 
shown that unemployment rates among Veterans are approximately double 
those of non-Veterans. As Veterans lose access to other health care 
options, such as employee health insurance, they increasingly seek VA 
care. However, because this economic impact was incorporated into the 
model for the first time, the estimated need was proposed to be funded 
through the contingency fund. Under this funding mechanism, the funds 
will only become available for obligation if the Administration 
determines that the estimated changes in economic conditions 
materialize in 2012. The contingency fund ensures the resources are 
available for the potential need, while monitoring the consistency 
between this first-time projection and latest available data.

    Question 8. What guarantees are there that the dollars in the 
contingency fund will be released, and released on time, if the 
determination is made that they will be needed?
    Response. Section 226 of the Administrative Provisions state that 
``* * * such funds shall only be available upon a determination by the 
Secretary of Veterans Affairs, with the concurrence of the Director of 
the Office of Management and Budget, that:

    (a) The most recent data available for:

          (1) National unemployment rates,
          (2) Enrollees' utilization rates, and
          (3) Obligations for Medical Services,
validates the economic conditions project in the Enrollee Health Care 
Projection Model, and

    (b) Additional funding is required to offset the impact of such 
factors.''
    VA and the Administration will work closely together to determine 
if the estimated economic impact materializes and, if so, to ensure 
that the funds are released promptly to the VISNs and VA medical 
centers to meet the increased demand for health care.
                           claims processing
    Question 9. Please describe what criteria are used in forecasting 
claims workload. How confident are you that the forecast for FY 2012 is 
correct?
    Response. VBA uses historical trend analysis of VA disability claim 
receipts, to include information such as, but not limited to, total 
amount of claims received, types of claims received, regional office of 
jurisdiction from where claims are received, as well as an estimate of 
the average number of disabilities and types of disabilities claimed on 
an annual basis. This data is captured and stored with the centralized 
VBA claims corporate database. VBA also uses external information such 
as actual and forecasted Servicemember discharges provided by the 
Department of Defense in order to help in the estimation of new 
Veterans potentially seeking VBA services. Furthermore, VBA also uses 
external data from both government and private organizations such as 
the Centers for Disease Control and Prevention and the American Heart 
Association to estimate the number of potentially eligible Veterans 
when proposed changes to legislation and/or internal updates to 
regulations are introduced that impact VA disability benefits. VBA has 
a high degree of confidence that the workload forecast of 1,326,000 
incoming disability compensation and pension claims is valid.

    Question 10. Please provide data on the status of the Agent Orange 
Fast Track program, including the number of claims filed and the 
average time to process a claim that has been filed through that 
system.
    Response. The Fast Track Claims Processing System has been 
operational since October 29, 2010. The Fast Track System accepts 
claims for the three Agent Orange presumptive conditions of Parkinson's 
disease, ischemic heart disease, and B-cell leukemia. Veterans may file 
claims for these conditions electronically through the Fast Track web-
based portal or by mail or fax to the regional offices or the Fast 
Track intake facility in Rocket Center, WV. Through the use of 
Disability Benefits Questionnaires, the system automatically generates 
recommended rating decisions to assist VA decisionmakers.
    As of March 15, the Fast Track System has 17,712 cases entered--
2,540 filed online by Veterans and 15,172 entered by VA employees (non-
Nehmer claims received after publication of the final rule). Fast Track 
claims rated through March 15 total 2,294.
    Average time to complete claims processed through the system is not 
available at this time. VA continues to work with our support 
contractor to refine the Fast Track System, including a more robust 
reporting functionality. The scheduled reporting enhancements will 
allow Fast Track to directly interface with the VBA corporate database, 
ensuring consistent data reporting across both systems.

    Question 11. Please provide data on the usage of disability 
benefits questionnaires. To date, how many DBQs have been received by 
VA? Of the DBQs that have been received, how many VA medical 
examinations have been provided for the same condition?
    Response. As of March 14, 2011, VBA has received 14,434 Disability 
Benefits Questionnaires (DBQs) from C&P Exams performed by VHA. VBA 
received an additional 2,441 DBQs from other sources. No additional 
analysis is currently available regarding how many VA examinations were 
provided in cases where a DBQ was also submitted. An in-depth case by 
case analysis would be required to parse out when and why a VA 
examination may have been subsequently requested in a case involving a 
DBQ received as private medical evidence.

    Question 12. What measures is VA taking to prevent fraud in the use 
of DBQs? For example, are there controls in place to prevent VA 
employees or veterans from modifying the DBQs that are given to VA 
after being filled out by a provider? Does VA have a system in place 
that will recognize whether a provider is routinely giving favorable, 
and perhaps unwarranted, assessments of veterans?
    Response. VA has a program in place to prevent fraud. Recently, 
VA's Office of Inspector General (OIG) conducted an evaluation of this 
oversight program. The Director of Compensation and Pension (C&P) 
Service is currently awaiting feedback from OIG about this program, 
which involves surveying a representative sample of submitted DBQs and 
validating the information with the clinician identified on the form. 
This validation is meant to ensure that the clinician is appropriately 
identified and that the submitted information has not been altered 
after the clinician signed the form. However, we note that the 
completed DBQ is merely a statement from a private physician providing 
relevant medical information. VA's current regulations at 38 CFR 
3.326(c), regarding the validation of statements from private 
physicians remain applicable. However, the level of scrutiny being 
applied to the DBQ far exceeds the standards currently applicable to 
other statements from private physicians. The provisions of 
Sec. 3.326(c) stipulate that, provided that it is otherwise adequate 
for rating purposes, a statement from a private physician may be 
accepted for rating a claim without further examination. VA accepts 
private medical evidence (non-VA sources) at face value unless there is 
reason to question it. If questionable, the statement will either be 
returned to the provider for clarification or a medical opinion may be 
requested from VHA. VA's systemic review process to actively review 
DBQs for validity far exceeds the current system of validation.

    Question 13. Please describe all existing claims processing pilots. 
What are the specifics of each pilot in terms of location, size, 
purpose, timeframe for completion, and other relevant elements? What 
are the measures of success for each pilot? Who within VA is 
responsible for the overall management and evaluation of each pilot and 
for compiling the lessons learned from the various pilots?
    Response. Attached is information on the nearly four dozen pilots 
that have been nationally tracked. This includes 19 that have run their 
course and are no longer active pilots, some of them becoming permanent 
tools, best practices, or implemented nationally. For the remaining 
pilots, VA is using a project management tool to set schedules with key 
milestones and decision points and develop plans for potential pilot 
implementation and future rollout. This approach will provide a more 
uniform guide to defining project metrics.
    In general, pilot success is measured against the overarching 
principles of providing greater efficiency and improving the delivery 
of services. This includes, but is not limited to, more timely 
decisions of higher quality and increased capacity to provide more 
claims decisions.
    Responsibility for overall management, evaluation, and compilation 
of lessons learned lies with VBA's Office of Strategic Planning (OSP). 
Initiative leaders and OSP staff regularly brief VBA leadership on 
pilots' status, with recommendations for next steps at key junctures.

    Question 14. VA does not appear to have a systemic way of 
incorporating current laws, including precedential case law, into the 
manuals relied upon or the text used in rating decisions. How can 
veterans expect to obtain correct decisions when adjudicators are 
instructed to apply incorrect laws? What actions can you take to ensure 
that the legal information relied upon by rating employees is correct 
and reflects current law?
    Response. VBA's methods of incorporating current laws, including 
case law, into its procedures follow.
    Daily, the C&P Service Policy Staff review legislative enactments, 
decisions by the Court of Appeals for Veterans Claims, and relevant 
decisions by the United States Court of Appeals for the Federal 
Circuit. If a new law or court decision impacts VA procedures or 
requires a regulatory or other change, a written assessment identifying 
any needed amendments is drafted within days of the decision date. The 
assessment document is forwarded to the appropriate C&P Service staffs 
for action. The assessment and the text of the court decision are 
immediately made available to all field offices. Regarding legislative 
amendments and court decisions mandating substantive policy or 
procedural changes, Fast Letters, which are binding on VA 
decisionmakers, are issued to the field offices to provide guidance in 
advance of amendments to the adjudication procedures manual M21-1MR or 
VA regulations. Simultaneously, recommendations based on the 
legislation or court decision are provided to the C&P Regulations or 
Procedures Staffs for necessary amendment. All Fast Letters, Training 
Letters, and assessments of court decisions are posted on the C&P 
Service Calendar page. The individual regional offices identify new 
postings affecting the adjudication process, and provide local training 
in accordance with the published guidance. Compliance with newly 
released guidance is assessed through both regional office Quality 
Review programs and the C&P Service's nationwide Systematic Technical 
Accuracy Review program.
    If the Policy Staff determines that a change to the rating text is 
required, the decision assessment document is forwarded to C&P 
Service's Business Process Staff for incorporation into the Rating 
Board Automation (RBA) system. The C&P Service RBA business analyst 
submits a change request to the Hines Information Technology Center 
through the VBA Office of Business Process Integration for the next 
available VETSNET release. This may take an extended period of time, as 
the requirements for a release must be submitted 6 months in advance of 
the release. As noted above, if the text is needed immediately, the C&P 
service issues a Fast Letter to inform the field that until RBA2000 
changes are made, they must insert approved text into the rating 
decision.

    Question 15. How many FTE of the Compensation and Pension Service 
Quality Assurance program will be supported in the FY 2012 budget 
request?
    Response. Compensation and Pension Service currently has 49 
employees dedicated to quality assurance. At this time there are no 
plans to increase the number of employees in the National Quality 
Assurance Program.

    Question 16. The Secretary has a commitment to eliminate the claims 
backlog and improve quality to 98 percent by 2015. Please explain how 
the level of quality of decisions is determined. How does VA intend to 
reach 98 percent?
    Response. The Systematic Technical Accuracy Review (STAR) system is 
VBA's national program for measuring compensation and pension claims 
processing accuracy. The STAR system includes review of work in three 
areas: claims that usually require a rating decision, claims that 
generally do not require a rating decision, and fiduciary work. Audit-
style case reviews are conducted after completion of all required 
processing actions on a claim. The review is outcome-based and includes 
all elements of processing that claim. STAR accuracy review results are 
generated for all VBA regional offices, brokering centers, the Tiger 
Team, which process claims from Veterans over 70 years old or pending 
over one year, and Pension Management Centers, and are included in the 
regional office directors' annual performance evaluations.
    Under the STAR program, a statistically valid random sample of 
completed work is reviewed from each processing center. The benefit 
entitlement accuracy rate is the official measure of a station's 
quality performance. Benefit entitlement accuracy for rating claims 
includes: addressing all issues, compliance with Duty to Assist (38 CFR 
3.159), correct decision to grant or deny, and proper award action 
(correct payment rates and effective dates).
    In addition to STAR assessments, VBA has a number of other methods 
of assessing quality, including consistency assessments, site surveys, 
and special reviews. The results of these assessments are analyzed and 
used to develop both local and national training.
    In support of the Secretary's commitment to eliminate the claims 
backlog and improve quality to 98 percent by 2015, VA has undertaken a 
comprehensive Claims Transformation Plan. (See attached Claims 
Transformation Initiatives dated March 2011.) Specialized quality 
review positions are being created in each regional office to focus 
solely on the improvement of quality. The employees selected for these 
positions will be part of dedicated quality review teams at each 
Regional Office.
    During fiscal year 2011, the STAR Staff is conducting training for 
the employees from each regional office currently responsible for 
conducting local quality reviews. This training is designed to help 
achieve consistency between national and local quality reviews. The 
STAR Staff is scheduled to complete the training for employees 
currently assigned to these duties in May 2011.
    Logic-based tools have been developed to aid VA decisionmakers by 
automating simple decisions to provide more accurate and consistent 
decisions for Veterans. Hearing loss and Special Monthly Compensation 
calculators have been implemented nationwide, and additional logic-
based tools are currently in the works.
    Through the use of sound training programs, information technology 
job aids, and enhancements to decision support systems, VBA 
decisionmakers are being provided the tools needed to make consistent, 
quality decisions.

    Question 17. Please define the amount of money in the President's 
budget request that is allocated for the administration of the 
Integrated Disability Evaluations System for those based overseas but 
going through the program. Please provide the plan for this program 
overseas.
    Response. Expansion of the Integrated Disability Evaluation System 
is still in the planning phase with the Department of Defense. 
Therefore, no specific amount of money has been allocated for this 
population of servicemembers.
                              construction
    Question 18. Please provide a list of priority weights for the 6 
major criteria and 18 subcriteria in the Analytic Hierarchy Process 
used to inform the Strategic Capital Investment Plan decision plan.
    Response. Priority weights for the 6 major criteria and 18 sub-
criteria used to prioritize capital projects in the FY 2012 Strategic 
Capital Investment Planning (SCIP) cycle are provided in the table 
below.

[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]


    Question 19. Please explain the 81 percent reduction in funding 
requested for the facility security projects account, from $42.5 
million in FY 2011 to $8 million in FY12.
    Response. The reduced funding requested in FY 2012 is directly 
related to the reduction of facility security requirements of the 
projects included in the FY 2012 budget.

    Question 20. How is VA measuring the impact of the $24 million that 
funded costs associated with on-site supervision of major construction 
projects by 140 resident engineers?
    Response. The 140 resident engineers requested in FY 2012 is the 
same level requested in FY 2011. VA determines the number of resident 
engineers (RE) needed on construction projects based on the size and 
complexity of the project, the amount of shift work the contractor is 
proposing and the number of contracts that will be on-going 
simultaneously. Resident engineers are evaluated based on several 
factors: the timeliness of responses to requests for information from 
the contractor, monitoring how well the contractor builds the facility 
in accordance with the drawings and specifications for the project, and 
monitoring schedule performance. Additionally, the establishment of a 
robust project management culture will increase project visibility and 
accountability for managing the capital program and decrease the risk 
currently assumed by having minimal government representation on 
complex construction projects valued in the hundreds of millions of 
dollars.

    Question 21. VA has a variety of capital planning mechanisms. 
According to the FY 2012 budget request, Strategic Capital Investment 
Plan lays out each VISN's capital needs through a ten-year action plan; 
the Building Utilization and Review and Repurposing initiative 
identifies underutilized real estate to develop housing opportunities 
through the Enhanced Use Lease program; and the Real Property Cost 
Savings and Innovation Plan seems to include repurposing, demolition, 
mothballing, and a number of other initiatives. Please provide more 
information on each program, their synergies, and their differences. 
Also, please explain how each fits in to a larger national vision on 
capital planning, especially in the context of health care delivery.
    Response. VA's Strategic Capital Investment Planning (SCIP) process 
is the data driven approach that systematically identifies VA service 
or infrastructure ``gaps'' and prioritizes capital investment projects 
in terms of their ability to close these gaps. SCIP is a forward-
looking strategic plan to meet VA's current and future infrastructure 
needs and is inclusive of the many other on-going efforts to improve 
real property utilization and meet strategic departmental objectives. 
Within SCIP, two of the tactical program means to close these gaps are 
BURR and the Real Property Cost Savings and Innovation Plan. Other 
tactical means include major construction, minor construction, non-
recurring maintenance, leasing, and use of non-capital solutions. SCIP 
includes the results of many planning processes and is the collection 
of all activities that impact the VA real property portfolio and its 
performance. Projects that are identified in these planning processes 
must be included in the SCIP 10-year action plan on how the VISN plans 
to address their service or infrastructure gaps. The following is a 
more detailed discussion of the two tactical efforts requested in the 
question.
    VA's Building Utilization Review and Repurposing (BURR) initiative 
is a targeted nationwide effort to reuse or repurpose underperforming 
capital assets to address strategic objectives, such as ending Veteran 
Homelessness and consolidating/realigning assets for direct services to 
the Veterans VA serves. The Department's EUL authority and the BURR 
initiative allow VA to match supply (available buildings and land) and 
demand among Veterans for housing with third-party development, 
financing, and supportive services. These activities affect VA's real 
property inventory and therefore would be part of the Strategic Capital 
Investment Plan (SCIP) as a means to address unused space, meet 
increased service demands, and provide enhanced services to Veterans.
    The Real Property Cost Savings and Innovation Plan identifies cost 
savings expected from current and new initiatives. The expected savings 
from repurposing, demolition, and mothballing, reported in the Real 
Property Cost Savings and Innovation Plan, is a quantification of 
expected savings from actions planned under BURR and other disposal 
planning activities. Other actions, such as telework and energy 
conservation measures, are also part of the cost savings plan. These 
actions impact VA's real property portfolio and therefore would be part 
of the SCIP process. There are additional items in the cost savings 
plan that are purely operational in nature, such as commodity 
purchasing, that does not impact capital investments and would not be 
part of SCIP.

    Question 22. The VA Real Property Cost Savings and Innovation Plan 
proposes $18.5 million in savings through several different mechanisms. 
Please provide the amount of savings projected for each portion of the 
plan.
    Response. VA continues to look for innovative ways to save 
operational costs related to its real property inventory while 
maintaining a high level of service. The Cost Savings plan has a number 
of key initiatives that span all VA Administrations and continues to be 
refined as new initiatives and legislation occur. VA currently has 
projected the following preliminary estimates for real property cost 
savings for VHA.


------------------------------------------------------------------------
                                                                 $ in
          Potential Cost Savings for VHA in FY 2012            millions
------------------------------------------------------------------------
Repurpose Vacant and Underutilized Assets...................           3
Demolition and Mothballing..................................           3
Energy and Sustainability...................................          10
Telework....................................................           2
Renegotiate GSA Lease Costs.................................         0.5
                                                             -----------
      Total.................................................       $18.5
------------------------------------------------------------------------


    Question 23. Why was renewing the enhanced use lease authority not 
among the Department's legislative requests?
    Response. VA is developing an improved request to address the 
imminent expiration of its enhanced-use lease (EUL) authority that will 
be submitted to Congress soon.

    Question 24. How much would it cost to renew the enhanced use lease 
authority and, separately, what cost avoidance would be realized by 
renewing this authority?
    Response. The EUL program has been active in VA for close to 20 
years. No new or additional costs are associated with the renewal of 
the authority. VA currently has the authority to offset its costs to 
administer the program with proceeds/revenue generated through EUL 
projects. VA's EUL authority also allows the Department to transfer the 
operations and maintenance costs to a third party (developer/lessee) 
for an extended term (up to 75 years), accounting for annual cost 
savings to VA that are directed to providing services to Veterans. In 
addition, VA generated cost revenue of $3.1 million, cost avoidance of 
$32.6 million, and cost savings of $ 5.8million in 2010. Since 2006, 
the EUL program has cumulatively generated $266.1 million in total 
consideration to VA. We believe that the continuation of the EUL 
program would allow the Department to realize similar cost avoidance 
and savings in the future.

    Question 25. Please provide the most recent copy of the VA Seismic 
Inventory Report developed in consultation with Degenkolb Engineers.
    Response. See Attachment.

    [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
    
                              homelessness
    Question 26. The President's budget request notes that VA is 
developing research on health conditions and risk factors that relate 
to homelessness and on the effectiveness of VA homeless services. Are 
there any preliminary findings from this research that you can share 
with the Committee? When can Congress expect to see the results of 
these studies?
    Response. The VA National Center on Homelessness Among Veterans 
(NCHV) has adopted a research agenda with a focus on the epidemiology 
of homelessness among Veterans and the effectiveness of services 
intended to prevent and end homelessness among Veterans. These studies 
are aimed at closing gaps in the research related to the prevalence of 
homelessness among Veterans, characteristics of Veterans who experience 
homelessness, and factors that predict homelessness among Veterans as 
well as Veterans' utilization of services and whether these services 
are both efficient and effective.
    The initial studies conducted by the NCHV have focused on 
developing a definitive count of homeless Veterans. To this end, the 
NCHV collaborated with the U.S. Department of Housing and Urban 
Development (HUD) to develop Veteran Homelessness: A Supplemental 
Report to the 2009 Annual Homeless Assessment Report to Congress, which 
provides point-in-time and annual counts of homeless Veterans in the 
United States--75,609 and 135,334, respectively--as well as the 
characteristics and locations of homeless Veterans. An additional 
investigation of the prevalence and risk of homelessness among Veterans 
in a selection of communities provides more detailed analyses of 
homelessness risk. Taken together, these studies indicate that Veterans 
are overrepresented within the homeless population. Specifically, the 
multi-site investigation found that, after controlling for poverty, 
age, race, and geographic variation, female Veterans were three times 
as likely as female non-Veterans to become homeless, and male Veterans 
were twice as likely as male non-Veterans to become homeless.
    There is another study underway to identify specific risk factors 
for homelessness among Veterans and to accurately prioritize prevention 
resources for those who are at imminent risk of homelessness. The NCHV 
is developing a Homelessness Risk Assessment, which will be piloted in 
a variety of settings and tested for reliability and validity. The 
instrument is a brief, two-stage assessment that first assesses whether 
a Veteran has a safe and stable place to stay for at least 90 days. If 
the Veteran appears to be at risk, the second stage of the instrument 
assesses the Veteran's current living situation, barriers to living 
independently, and supports that the Veteran may have or require to 
access and maintain safe and stable housing. The assessment will inform 
appropriate referrals to homelessness prevention or other services. In 
addition, data collected through the assessment process will guide 
decisions regarding need for and targeting of resources moving forward, 
including specific characteristics that may pose risk for homelessness.
    While homelessness among Veterans in the OEF/OIF/OND service era is 
a priority concern, there is limited empirical data about the extent to 
which or dynamics whereby they do become homeless. To address this, the 
NCHV is examining the onset of homelessness among recent Veterans, 
including those returning from the OEF and OIF conflicts. Working in 
conjunction with the VA Office of the Inspector General and municipal 
shelter providers in Columbus, Ohio, New York City, New York and 
Philadelphia, Pennsylvania, researchers at the NCHV are compiling an 
array of data that will facilitate identifying risk factors for 
homelessness among OEF/OIF Veterans at the time of their separation 
from the military. This promises to inform prevention programs and 
increase their efficiency. Services use patterns among this group will 
also be examined to assess the extent to which they use VA services, 
community services, or a combination of the two. This will increase the 
understanding of how Veterans access the services available to them, 
and will facilitate better coordination of services between VA and 
mainstream homeless service systems.
    The NCHV is also organizing a series of studies around the general 
topics of mortality, morbidity, and aging among homeless Veterans. The 
overall goal of this project is to assess the demographic trends among 
the homeless Veteran population to project future trends in the size 
and makeup of this population, and to anticipate future demand for 
services. Research conducted by study investigators has shown the 
overall single adult (i.e., not family) homeless population to be 
steadily aging. If these trends continue, this would lead to higher 
risk for early mortality and greater needs for long-term care. Research 
is currently underway to assess whether these trends also hold for 
homeless Veterans, and the impact that providing homeless Veterans with 
housing has on subsequent health and mortality.
    Additionally, an examination of the intersection of suicide and 
homelessness has produced preliminary findings which show that 24 
percent of Veterans in a registry of suicide attempters also had 
records of receiving VA homeless services.
    Another project is examining the life course of elderly Veterans 
with records of homelessness, and their uses of VA and non-VA health 
care services.
    Several of these studies are in the initial phases. We anticipate 
preliminary data on most of them to be available by the end of Fiscal 
Year 2011, and final reports by the end of Fiscal Year 2012.

    Question 27. The Department has a number of programs with the goal 
of preventing veteran homelessness before it starts and ending it once 
veterans are on the streets. For each program, please share how many 
veterans are helped annually and how many have been helped since the 
program started. Of these programs, which have led to the largest 
reductions in homeless populations?
    Response. The Department of Veterans Affairs (VA) operates the 
largest system of homeless treatment and assistance programs in the 
Nation. In 2010, VA's specialized homeless programs served more than 
116,000 Veterans. The hallmark of VA's homeless programs are that they 
provide comprehensive care and benefits including medical, psychiatric, 
substance abuse, rehabilitation, dental care and expedited claim 
processing for these Veterans. In addition, VA case management and 
supportive services are focused on preventing and ending homelessness. 
The following programs represent VA's homeless continuum of care. All 
programs in the continuum are part of VA's plan to end homelessness and 
contribute to the overall reduction of the homeless Veteran population. 
Each program represents a different part of the continuum and no 
program is more efficacious than another.
    Prevention Programs:

    The primary VA prevention program, Supportive Services for Veteran 
Families (SSVF), is in the process of being implemented. The grant 
application period closed on March 11, 2011 and VA is in the process of 
reviewing these applications and awarding these grants. VA expects to 
announce these awards in June 2011.
    A second prevention program is the Veterans Homelessness Prevention 
Demonstration (VHPD) also referred to as the HUD-VA Pilot. The HUD-VA 
Pilot program is designed to explore ways for the Federal Government to 
offer early intervention homeless prevention, primarily to Veterans 
returning from wars in Iraq and Afghanistan. This demonstration program 
will provide an opportunity to understand the unique needs of this new 
cohort of Veterans, and will support efforts to identify, outreach, and 
assist them to regain and maintain housing stability. This three year 
HUD-VA prevention pilot is a partnership among the Department of 
Veterans Affairs (VA), the Department of Housing and Urban Development 
(HUD), the Department of Labor (DOL), and local community agencies. 
VHPD will serve the following locations: MacDill Air Force Base in 
Tampa, Florida; Camp Pendleton in San Diego, California; Fort Hood in 
Killeen, Texas; Fort Drum in Watertown, New York; and Joint Base Lewis-
McChord near Tacoma, Washington. As the lead agency, HUD is awarding 
grants for the provision of housing assistance and supportive services 
to prevent Veterans and their families from becoming homeless, or 
reduce the length of time Veterans and their families are homeless. 
HUD's Office of Special Needs Assistance Programs (SNAPS) executed the 
grant agreements with the pilot site Continuums of Care grantees on 
February 3, 2011. VA case management and outreach staff have been hired 
at each of the sites and are working with Department of Labor staff and 
the Continuum of Care grantees to implement the program. The HUD-VA 
pilot sites are expected to start delivering services to Veterans no 
later than March 2011.
    The National Call Center for Homeless Veterans (NCCHV) was founded 
to ensure that homeless Veterans or Veterans at risk for homelessness 
have free, 24/7 access to trained counselors. The hotline is intended 
to assist homeless Veterans and their families, VA medical centers, 
Federal, state and local partners, community agencies, service 
providers and others in the community. The NCCHV call number (1-877-
4AID VET) was activated the week of December 21, 2009 and full 
implementation commenced on March 1, 2010. From March 1, 2010 to 
February 28, 2011, there have been 25,771 calls to the NCCHV. Of the 
calls received, 20,831 callers identified as Veterans; 6,578 Veteran 
callers identified as being homeless; and 11,769 Veteran callers 
identified as being at risk of homelessness.
    As part of the Plan to End Homelessness Among Veterans, VA is 
focused on serving Veterans involved with the criminal justice system, 
who may be homeless or at risk for homelessness. Studies have shown 
that for adult males, incarceration is the most powerful predictor of 
homelessness (Burt et al., 2001). The Health Care for Reentry Veterans 
(HCRV) program provides outreach and linkage to post-release services 
for Veterans in state and Federal prisons; HCRV Specialists have 
provided reentry services to 24,244 reentry Veterans since Fiscal Year 
(FY) 2008, including 9,622 Veterans in FY 2010. The Veterans Justice 
Outreach (VJO) program focuses on Veterans in contact with law 
enforcement, jails, and courts, including the rapidly expanding 
Veterans Treatment Courts (VTC). VJO Specialists have served a total of 
8,004 justice-involved Veterans since the start of the program, 
including 5,849 so far in FY 2011.
Rehabilitation, Treatment, Transitional Housing and Permanent 
        Supportive Housing Programs:
    Grant and Per Diem Program (GPD): The GPD program allows VA to 
award grants to community-based agencies to create transitional housing 
programs, and provides per diem payments to the programs to support 
operational costs. The purpose is to promote the development and 
provision of supportive housing and/or supportive services with the 
goal of helping homeless Veterans achieve residential stability, 
increase their skill levels and/or income, and obtain greater self-
determination. GPD-funded projects offer communities a way to help 
homeless Veterans with housing and services while assisting VA medical 
centers by augmenting or supplementing care. The GPD program has 
provided services for 98,493 unique Veterans since 1995, including 
15,706 Veterans in FY 2009, 17,305 Veterans in FY 2010, and 4,174 
Veterans during the first quarter of FY 2011 (data from NEPEC annual 
report).
    Health Care for Homeless Veterans (HCHV): The central goal of the 
HCHV programs is to reduce homelessness among Veterans by conducting 
outreach to those who are the most vulnerable and are not currently 
receiving services and engaging them in treatment and rehabilitative 
programs. The HCHV Outreach program has served 383,362 unique Veterans 
since 1987; this includes 81,212 Veterans in FY 2009, 90,237 Veterans 
in FY 2010, and 36,371 Veterans during the first quarter of FY 2011.
    The HCHV Contract Residential Treatment Program ensures that 
Veterans with serious mental health diagnoses can be placed in 
community-based programs which provide quality housing and services. 
HCHV provides ``in place'' residential treatment beds through contracts 
with community partners and VA outreach and clinical assessments to 
homeless Veterans who have serious psychiatric and substance use 
disorders. The HCHV Contract Residential Treatment Program has served 
54,723 unique Veterans since 1987; this includes 2,870 Veterans in FY 
2009, 3,541 Veterans in FY 2010, and 1,592 Veterans during the first 
quarter of FY 2011.
    Domiciliary Care for Homeless Veterans (DCHV): The DCHV Program 
provides time-limited residential treatment to homeless Veterans with 
health care and social-vocational deficits. DCHV programs provide 
homeless Veterans access to medical, psychiatric, and substance use 
disorder treatment in addition to social and vocational rehabilitation 
programs. The DCHV program has served 76,289 unique Veterans since 
1988; this includes 8,605 Veterans in FY 2009, 8,445 Veterans in FY 
2010, and 3,267 Veterans during the first quarter of FY 2011.
    Housing and Urban Development-VA Supported Housing (HUD-VASH): This 
is a collaborative program between HUD and VA where eligible homeless 
Veterans receive VA-provided case management and supportive services to 
support stability and recovery from physical and mental health, 
substance use, and functional concerns contributing to or resulting 
from homelessness. HUD-VASH is the Nation's largest supported permanent 
housing initiative. As of February 28, 2011, 19,834 Veterans are 
currently under lease, 6,667 Veterans have vouchers assigned to them, 
and are in process of getting housed and 3,936 vouchers are at the 
Public Housing Authority waiting to be assigned to a Veteran. Since 
2008, a total of 23,011 Veterans have been housed through this program.

    Question 28. The new homeless veteran call center is a vital tool 
for centralizing and standardizing the information VA provides to the 
public.
    A. Who typically calls this center?
    Response. From March 1, 2010 to February 28, 2011, there have been 
25,771 calls to the NCCHV. As of February 28, 2011, there have been 
20,831 callers identified as Veterans; 6,578 Veteran callers identified 
as being homeless; and 11,769 Veteran callers identified as being at 
risk of homelessness.
    Additionally family members and friends of Veterans, community 
agencies, military/Veteran service providers and other interested 
parties have been identified as calling the National Call Center for 
Homeless Veterans (NCCHV) to help Veterans.
    B. What type of information is provided to callers?
    Response. Callers are provided the location of their nearest VA 
Medical Center as well as the names and phone numbers of the VA Medical 
Center's identified primary and secondary Homeless Program Points of 
Contact Callers are provided information, referral and intervention 
based on their presenting needs. Information regarding names and 
numbers of community agencies and local community resources are 
provided, as well as national Web sites and other hotline numbers.
    C. What is the average wait time to reach a staff member?
    Response. The National Call Center for Homeless Veterans (NCCHV) 
answers calls 24 hours a day, 7 days a week. All calls are answered 
immediately by trained responders at the NCCHV who conduct a brief 
screen to determine need and severity of need. Responders at the NCCHV 
then link those callers needing referral and linkage to the nearest VA 
Medical Center Homeless Program Point of Contact anywhere in the 
country. Emergency calls are linked immediately to the VA Medical 
Center's identified Homeless Program Point of Contact or after hour/
weekend staff for assistance and intervention. Responders at the NCCHV 
can contact the Point of Contact or the after hour/weekend staff to 
consult on any call that may be urgent in nature to determine a course 
of action and develop a plan. For routine calls, the Point of Contact 
will respond within 24 hours or the next business day. All consult 
reports are completed by the Point of Contact within 5 business days 
and includes the Homeless Team's update on how they assisted the 
Veteran as well as any ongoing plan of care.
                             women veterans
    Question 29. What funds are being specifically directed toward 
expanding hours at women's clinics?
    Access to care, including making care available outside of typical 
operating hours, continues to be a part of the prospective changes to 
support ever increasing patient-centeredness of VA health care. 
According to information gathered in March, 2011, 29 facilities across 
24 states currently offer extended primary care hours for women. 
Overall, 20.4% of facilities offer extended primary care hours 
(operating hours outside of usual operating hours 8am-4:30pm) for women 
and 24% offer extended primary care hours for men. It is anticipated 
that these numbers will continue to increase as the transformation to 
patient-aligned care teams and the focus on more patient-centered care 
continues. In FY 2011, the VISNs received approximately $410 million in 
Major Strategic Initiative/Transformation Initiative funds which could 
be used to expand primary care hours for women, among other purposes.

    Question 30. Please provide detailed information on the childcare 
pilot program. Where will these pilots occur?
    Response. VA recognizes that Veterans may need childcare options 
during health appointments and research confirms that lack of childcare 
may be a barrier to utilization of VA care by women Veterans. However, 
because childcare is not considered medical care, VA does not have 
authority to provide it. Currently, VA facilities may not use resources 
or personnel to provide childcare to Veterans attending appointments. 
Section 205 of Public Law 111-163, the Caregivers and Veterans Omnibus 
Health Services Act of 2010, signed May 5, 2010, requires VA to conduct 
a 2 year pilot program in at least three Veterans Integrated Service 
Networks (VISN) that offers eligible Veterans childcare when seeking a 
medical appointment. VA is currently working to determine the mechanism 
for pilot sites and to determine the definition of ``primary 
caretaker'' as provided in the legislation. We plan to initiate pilot 
childcare projects through three VISNs later this year, with initial 
pilot sites becoming operational this summer.

    Question 31. VA's response to pre-hearing questions noted that $17 
million in FY 2011 non-recurring maintenance funding has been budgeted 
for correcting patient privacy deficiencies. Is this amount sufficient 
to cover all of the construction recommendations identified in GAO's 
report, VA Has Taken Steps to Make Services Available to Women 
Veterans, but Needs to Revise Key Policies and Improve Oversight 
Processes? If not, please provide an estimate as to how much funding is 
needed to make VA facilities accessible to women veterans.
    Response. The attachment follows. 

    [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
        
                         information technology
    Question 32. The President's budget request includes $5 million for 
the development of both short-term and long-term Strategic Capital 
Investment Plan Automation tools. Please explain what functionalities 
will be included in each.
    Response. Strategic Capital Investment Plan (SCIP) Automation Tool 
(SAT)

    SAT Short Term Solution: The SAT Short Term tool is the first stage 
in automating the data collection that serves as the basis for 
developing the 10-year Action Plans. The tool also provides for more 
efficient collection and analysis of data due to tool business rules 
and criteria as well as the ability to auto generate reports, which 
assist in synthesizing gap mitigation based on Action Plan submissions. 
The implementation of the SAT Short Term tool significantly reduced the 
manual and redundant data collection process that was used during the 
first year of the SCIP process.
    SAT Long Term Solution: The SAT Long Term tool will continue to 
enhance the automation of the Action Plan data collection process. The 
SAT Long Term is also a comprehensive tool that will continue to 
automate the collection of data during the Action Plan phase through 
the Business Case development and OMB budget formulation phases. The 
long term may also include modules for improved formulation and 
tracking of VA construction operating plans.
    The SAT Short Term tool solution serves as a functionality bridge 
between data collection requirements during the Action Plan phase and 
the additional data collection/analysis requirements during subsequent 
SCIP process phases. The full implementation of the SAT Long Term tool 
solution will incorporate all Action Plan data collection requirements 
as a one of several modules included in the included SAT Long Term 
tool.

    Question 33. The budget request includes two new IT systems: the 
Homeless Operations and Management Evaluation System and the VA 
Homeless Management Information System. Please explain the purpose of 
these new programs.
    Response. The Homeless Operations and Management Evaluation System 
is a case management system which specifically addresses the needs of 
the Homeless Veteran. As a case management system, it will register and 
administer benefits to the Homeless Veteran. Included in this program 
is the pilot and implementation of handheld devices that will be used 
by field outreach and case workers to interact with Homeless Veterans.
    The VA Homeless Management Information System program aims to 
gather information about Homeless Veterans receiving benefits and 
forwards that information to VA's Homeless Registry. The information 
gathered provides VA with information about the individual Veteran 
receiving benefits, and measures the effectiveness of various homeless 
programs.

    Question 34. How much of the Veterans Benefits Management System's 
long-term success hinges on the success of other programs such as the 
Virtual Lifetime Electronic Record?
    Response. One of the primary goals of the Virtual Lifetime 
Electronic Record (VLER) is to provide access to electronic health 
records, which are essential to VA's strategic goal of achieving the 
paperless administration of benefits. Capability to electronically 
access Veterans' health records through a secure, reliable, and 
accessible system will improve Veterans' experiences by increasing 
timeliness and predictability of claims decisions. In the short term, 
VBMS plans to scan the health records received as paper documents. In 
the longer term as VLER matures and approaches full operational 
capability, it will serve as a source of health and benefits data from 
not only VA but also from DOD, the Social Security Administration, 
other government agencies and the private sector, to make benefits 
delivery more efficient and convenient.

    Question 35. Are there decisionmaking quality measures that exist 
in VBMS and how will this software track errors in the long-term and at 
what level of granularity?
    Response. As VBMS moves VBA from paper-based to electronic claim 
processing, it will improve quality by ensuring adherence to processes, 
policies and procedures. Utilizing automated workflows and business-
rules engines will prevent common errors, thereby improving overall 
claim quality. Error checking, data validation and checks for 
completeness will help ensure that the claim is correct before it is 
finished, thereby reducing the need for costly rework. Additionally, it 
will provide more discreet claim-level information to VBA quality 
systems, enhancing end-of-line quality controls.

    Question 36. Please describe the major milestones for VBMS. For 
example, when will the system be truly paperless?
    Response. The VBMS initiative involves business transformation 
efforts coupled with incremental technology releases to modernize the 
benefits adjudication process. There are three successive phases that 
are designed to develop and test process improvements and VBMS 
technology solutions in a production claims setting.
    Phase 1 (November 2010-May 2011) delivers the first iteration of 
VBMS, including a new graphical user interface, an electronic claims 
repository and a scanning solution, which integrates with existing core 
business applications in the current legacy platform (VETSNET). The 
first iteration of the software is being tested at the VBA Regional 
Office in Providence, Rhode Island.
    Phase 2 (May 2011-November 2011) and Phase 3 (November 2011-
May 2012) are intended to provide capability and capacity for national 
deployment of an end-to-end paperless claims processing system. In 
addition to building out the core and a sustainable system, both phases 
will increase the number of regional offices, the number of users, the 
types of claims, and the number of claims processed using VBMS. Full 
national deployment is scheduled to begin in calendar year 2012.
    VA will continue to accept paper claims. Paper claims received will 
be scanned and processed in VBMS.

    Question 37. What efforts has VA planned, in working with DOD, to 
further articulate a shared set of goals for VLER?
    Response. The Department of Defense (DOD) and Department of 
Veterans Affairs (VA), in collaboration with the Interagency Program 
Office, have agreed to implement VLER by four (4) functional areas, 
called VLER Capability Areas (VCAs). Completion of a VCA indicates the 
availability of specific information sets in electronic form for 
authorized users, Veterans who have provided their consent, 
Servicemembers, and their beneficiaries and/or designees.

    VCA 1--represents the exchange and availability of clinical 
information needed for the delivery of health care in a clinical 
setting.
    VCA 2--expands health information from the initial set exchanged in 
VCA 1 to include the exchange of additional electronic health 
information for disability adjudication.
    VCA 3--completes the information needed for the delivery of the 
remaining benefits services, including other compensation, housing, 
insurance, education, and memorial benefits.
    VCA 4--ensures online access to benefits information via a single 
portal.

    Though work is progressing in all VCAs, DOD and VA are heavily 
focused on the implementation of VCA 1. The plan is to continue to 
expand pilot testing the exchange of subsets of clinical data, via the 
Nationwide Health Information Network, between DOD, VA and private 
health care providers, in 2011-2012. Lessons learned from these pilot 
tests will be used to determine scalability, usability, security, and 
reliability of the architecture for broader application, and 
implementation.

    Question 38. In response to prehearing questions, VA stated, ``In 
early calendar year 2010, VA undertook an extensive re-evaluation of 
its financial management challenges, risks and critical priorities. The 
re-evaluation, which included consideration of available resources, the 
clean audit opinions on VA's financial statements for 11 years in a 
row.'' Who performs these audits? Please provide the previous two years 
audits.
    Response. In FY 2010, the Department of Veterans Affairs was 
pleased to have received our 12th consecutive unqualified (``clean'') 
audit opinion on the Department's consolidated financial statements. 
The auditors were Clifton Gunderson LLP and their clean audit opinion 
is found on page III-59 of the Department's FY 2010 Performance and 
Accountability Report (http://www.va.gov/budget/report/). In FY 2009, 
the Department also received our unqualified (``clean'') audit opinion 
(11th consecutive clean opinion) on the Department's consolidated 
financial statements. The auditors were Deloitte and their clean audit 
opinion is found on page III-52 of the Department's FY 2009 Performance 
and Accountability Report (http://www.va.gov/budget/report/) for this 
link, you will need to page down and click on the 2009 PAR).

    Question 39. Is VLER under the Project Management and 
Accountability System and is it on target for meeting its goals for 
2012 and beyond?
    Response. In July 2009, the Veterans Affairs Chief Information 
Officer mandated that all funded information technology (IT) projects 
comply with Project Management and Accountability System (PMAS) 
guidelines. All VLER IT projects, including the VA adaptor to the 
Nationwide Health Information Network (NwHIN), which enable the VLER 
mission, are fully compliant with PMAS guidelines.
    Yes, established goals are on target for being met.

    Question 40. What role does DOD have in VA's recent public Request 
for Information on evolving VistA in an open source environment?
    Response. VA and DOD have ongoing, extensive discussions regarding 
Electronic Health Records, including the possible use of open source 
models for the development of the VistA EHR. The Electronic Health 
Record Open Source Custodial Agent Request for Information, prepared 
and released by VA with the full awareness of DOD, was informed by 
those discussions.
                vocational rehabilitation and employment
    Question 41. VA's budget request anticipates a 10 percent increase 
in the use of VR&E in FY 2012. Has this anticipated increase in 
workload taken into account the downturn in the economy and your 
planned outreach activities?
    Response. Yes, the projected increase is based, in part, on the 
downturn in the economy and our planned outreach activities. However, 
these increases are also projected based upon new compensation 
presumptive conditions, VR&E's participation in the IDES process, and 
Congress's recent changes to the Post-9/11 GI Bill that will now allow 
Veterans eligible for both Chapter 31 and Chapter 33 benefits to elect 
the higher Chapter 33 housing allowance.

    Question 42. Has VA designed outreach to specifically target Guard 
and Reserve units to educate them about VR&E?
    Response. Yes, VR&E's Coming Home to Work Program provides services 
to active duty Servicemembers, to include National Guard and 
Reservists. The program provides opportunities for Servicemembers and 
Veterans to obtain work experience, develop skills needed to transition 
to civilian employment, determine potential career opportunities, and 
return to suitable employment. VR&E's Coming Home to Work Coordinators 
also provide outreach services specifically for Guard and Reserve 
through the Yellow Ribbon and Post-Deployment Health Reassessment 
(PDHRA) events, which occur at 30, 60, 90 day intervals for returning 
Guard members and Reservists.

    Question 43. What effect, if any, do you expect the increased 
number of VR&E applicants will have on timely entitlement decisions? 
Will it have an effect on rehabilitation rates?
    Response. With the increase in FTE requested, VR&E projects 
improvements in the national rehabilitation rate and the speed of 
entitlement decisions. VR&E's request for additional FTE to support 
expansion of IDES is expected to provide early engagement in services 
with Servicemembers by physically placing Vocational Rehabilitation 
Counselors (VRC) at IDES locations. This will result in a more timely 
entitlement decisions. Servicemembers will spend less time in the 
transition period from eligibility to entitlement services and will 
have more timely access to VR&E benefits.

    Question 44. Are you confident that the increased staffing request 
will be sufficient to meet the higher demand for VR&E services?
    Response. Yes.

    Question 45. Please provide a copy of the VR&E work measurement 
study, for which the contract expired on February 25, 2011.
    Response. The VR&E Work Measurement Study final contract 
deliverable was rejected by VR&E for being incomplete. The contractor 
submitted a revised deliverable on March 25, but the study was again 
rejected. VR&E Service continues to work with the contractor to revise 
the final deliverable. Once an acceptable deliverable is provided, VR&E 
will review report for final concurrence, brief VBA leadership on the 
results, and submit a copy of the study to the Committee.

    Question 46. In response to a pre-hearing question on the 
Integrated Disability Evaluation System, the Department stated, ``All 
IDES participants will receive a mandatory initial counseling session 
in which a VR&E counselor will work with the separating Servicemember 
to determine whether and how further program participation can benefit 
them in their transition process.'' For clarification, will all IDES 
participants receive the mandatory counseling session, or just those 
who apply for VR&E services?
    Response. All IDES participants will receive the mandatory 
counseling session, not just those that apply for VR&E services. This 
face-to-face meeting will inform the Servicemember of the benefits 
available through the VR&E program. The Servicemember can then make an 
informed decision about whether or not to pursue VR&E program services.
                                 other
    Question 47. The President's Budget reflects a substantial decrease 
in the amount of funding for advanced planning within the National 
Cemetery Administration--from over $25 million in FY 2011 to only $4.3 
million in FY 2012. This reduction is proposed despite rather ambitious 
plans to expand operations in six different new cemeteries and to move 
forward with ``urban satellite cemeteries'' in four locations across 
the country. Are you satisfied that the budget will permit NCA to move 
forward to continue to plan to meet the needs of veterans and their 
families in their time of need?
    Response. If the FY 2011 President's budget request is approved, we 
will have $23.4 million available in the Advance Planning Fund (APF). 
An additional $4.5 million is requested in FY 2012.
    APF requirements are based on anticipated major construction needs. 
Available and requested APF funds are sufficient to cover the five new 
national cemeteries and planned gravesite expansion projects. The urban 
satellite cemeteries will be funded through minor construction.

    Question 48. Implementation of the Post-9/11 Veterans Educational 
Assistance Program and the timely and accurate payment of benefits are 
critical. The President's budget, however, decreases the number of FTE 
for the Education Service by over 200--despite the fact that there is 
also a 73 percent projected increase in claims since the program's 
inception and that significant changes were made early this year with 
the 2010 Improvements Act that could easily impact the timeframe for 
implementing the long-term automated processing system. Please give me 
VA's commitment to advise the Committee at the very first sign that 
there might be problems with available staffing. There are concerns 
that by releasing more than 200 employees who have over the past two 
years have developed skills in processing education claims, VA will be 
losing valuable expertise that might be utilized elsewhere in the 
Department. To what degree will the reduction in FTE be achieved by 
attrition rather than by dismissal?
    Response. To support Post-9/11 GI Bill claims processing, VA hired 
530 term employees as GI Bill claims examiners in February 2009. The 
term employees were part of VA's short-term solution until the Office 
of Information and Technology delivered the Long-Term Solution (LTS) 
for Post-9/11 GI Bill claims processing. VA anticipated all term 
employees would be retained through the end of FY 2011.
    The enactment of the Veterans Educational Improvements Act of 2010 
(P.L. 111-377) has impacted the development of the LTS for processing 
Post-9/11 GI Bill claims and our ability to fully automate the delivery 
of benefits. The capability for automated end-to-end processing of some 
supplemental claims was planned for June 2011. This capability would 
create a subset of claims that do not require manual intervention. 
Implementation of the LTS was expected to address the increased 
workload and improve claims processing timeliness while negating the 
need for temporary claims processors. Because all LTS development 
efforts will now be directed to implementing the changes in the new 
law, we anticipate this LTS functionality will not be available until 
the third quarter of FY 2012.
    The delay in the implementation of the enhanced functionality 
planned for the LTS impacts the number of FTE needed to process 
education claims. Our budget request of 1,429 FTE reflects the need to 
retain 324 of the 530 temporary claims examiners through FY 2012 to 
maintain current claims processing efficiencies. While there is a 73 
percent projected increase in claims since the inception of the Post-9/
11 GI Bill, VA anticipates only a 3.1 percent increase in claims from 
FY 2011 to 2012. We anticipate any reduction in FTE in FY 2012 will be 
accomplished through attrition.
    VA is committed to providing the best possible service to our 
Veterans. We will carefully measure the impact the LTS has on our 
ability to accurately and timely process Post-9/11 GI Bill claims, and 
we will continue to engage in dialog with Congress on issues that 
impact our ability to effectively and efficiently administer the Post-
9/11 GI Bill.

    Question 49. The budget request notes that VA plans to increase 
teleworkers by 250 percent over the next two years to realize savings. 
How many teleworkers does VA have currently, and how does VA plan to 
increase the number of employees who choose to telework?
    Response. VA records reflect a total of 4,669 employees' 
teleworking 1 or more days per week. VA has developed a multi-year 
strategy to increase telework to 16,636 employees' teleworking 1 or 
more days per week by the end of 2012. As part of this strategy, VA 
issued agency wide guidance in accordance with the Telework Enhancement 
Act of 2010 which includes the assignment of telework coordinators 
within each administration, all VISNs and VA's Central Offices. In 
addition VA has designed a multi-year strategy to promote the full 
utilization of telework through:

     a telework education program,
     promotion of best practices
     issuance of guidelines regarding suitability
     establishment of tracking mechanisms
     development of ``touchdown space'' guidelines; and
     assuring the necessary IT infrastructure is in place to 
support remote access users

    Question 50. Under the acquisition reorganization, what is the 
procurement dollar level authority at the Centralized Mail Order 
Pharmacy level? Please also submit the outline of the plan that shifts 
the buying authority from lower level entities into National 
Acquisition Center.
    Response. Currently the Office of Acquisition, Logistics, and 
Constructions' (OALC) National Acquisition Center (NAC) is providing 
acquisition support to the Consolidated Mail Outpatient Pharmacy (CMOP) 
and has warranted Contract Specialists supporting each of the seven 
CMOP facilities. Each of these contract specialists has senior level 
warrant authority which is unlimited. CMOP personnel will retain 
purchase card authority limiting purchases to $3,000 for goods; $2,500 
for services; and $2,000 for construction. CMOP personnel also may be 
delegated ``ordering officer'' authority allowing them only to issue 
delivery and/or task orders against specific contracts awarded by a VA 
contracting officer. Limitations will vary based on the ordering 
officer delegation.
    In that the NAC is currently providing buying authority to support 
CMOP operations, there is no plan that shifts buying authority.
                                 ______
                                 
  Response to Posthearing Questions Submitted by Hon. Richard Burr to 
                  U.S. Department of Veterans Affairs
                                general
    Question 1. The December 2010 report from the National Commission 
on Fiscal Responsibility and Reform included this recommendation:

        Reduce Federal travel, printing, and vehicle budgets. Despite 
        advances in technology, Federal travel costs have ballooned in 
        recent years, growing 56 percent between 2001 and 2006 alone. 
        Government fleets, meanwhile, have grown by 20,000 over the 
        last four years. Printing costs are still higher than necessary 
        despite technological advancement. We propose prohibiting each 
        agency from spending more than 80 percent of its [Fiscal Year 
        (FY)] 2010 travel budget and requiring them to do more through 
        teleconferencing and telecommuting. We also recommend a 20 
        percent reduction in the nearly $4 billion annual Federal 
        vehicle budget, excluding the Department of Defense and the 
        Postal Service. Additionally, we recommend allowing certain 
        documents to be released in electronic-only form, and capping 
        total government printing expenditures.

    A. In fiscal year 2008, how much in total was expended by the 
Department of Veterans Affairs (VA) on travel costs; how much in total 
was expended on printing costs; and how much in total was expended to 
purchase, operate, or maintain vehicles?
    B. In fiscal year 2009, how much in total was expended by VA on 
travel costs; how much in total was expended on printing costs; and how 
much in total was expended to purchase, operate, or maintain vehicles?
    C. In fiscal year 2010, how much in total was expended by VA on 
travel costs; how much in total was expended on printing costs; and how 
much in total was expended to purchase, operate, or maintain vehicles?
    D. For fiscal year 2011, how much in total is projected to be 
expended by VA on travel costs; how much in total is projected to be 
expended on printing costs; and how much in total is projected to be 
expended to purchase, operate, or maintain vehicles?
    E. For fiscal year 2012, how much in total is requested for travel 
costs; how much in total is requested for printing costs; and how much 
in total is requested to purchase, operate, or maintain vehicles?
    Response. 

    [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
    

    Question 2. In addressing the Commission on Fiscal Responsibility 
and Reform on April 27, 2010, President Obama stated, ``Now, I've said 
that it's important that we not restrict the review or the 
recommendations that this commission comes up with in any way. 
Everything has to be on the table.'' The Commission, itself, reiterated 
that sentiment in their December 2010 report: ``There is no easy way 
out. Everything must be on the table.'' (The Moment of Truth, page 6.)
    A. How has VA taken this sentiment into account in formulating the 
fiscal year 2012 budget request?
    Response. In developing the 2012 budget request VA was and remains, 
attentive to the themes of eliminating wasteful or unnecessary 
spending. VA has conducted a review of the efficiencies to be gained, 
and the savings to be achieved within the agency. These improvements 
are estimated to total $745 million in FY 2011. Similar improvements 
are included in VA's budget request for 2012 at estimated savings of 
$1.2 billion.
    The VA is firmly committed to increasing the value of every dollar 
entrusted by the Congress and the American taxpayer to this Department 
for the delivery of benefits and services to Veterans, their families 
and survivors. For example, in 2011, we are implementing several 
operational improvements in our medical care programs that will save 
money while improving the quality of health care. These include:

     Reducing indirect costs by adopting uniform standards for 
administrative and support services;
     Reducing the costs of non-VA provided dialysis by 
implementing Medicare's standard payment rates;
     Reducing acquisition costs by consolidating contracting 
requirements, adopting strategic sourcing and other initiatives;
     Reducing improper payments and improving operational 
efficiencies in the administration of the medical fee program; and
     Reducing payroll costs by increasing capabilities and 
productivity of healthcare professionals through more appropriate 
alignment of the mix of physician and nursing staff, and other non-
physician providers, to meet patient demand.

    In developing the 2012 budget, we also carefully reviewed 
requirements in our non-medical programs. As a result, we will reduce 
spending by $1.1 billion below current 2011 estimates in several 
program areas. For example, by prioritizing our most critical safety 
and security capital infrastructure needs, funding for major and minor 
construction will be reduced. Investments in information technology 
will begin to pay dividends as deployment of the Veterans Benefits 
Management System (VBMS) begins in 2012, allowing for increased 
productivity and reduced operating costs in processing disability 
compensation claims in the Veterans Benefits Administration. In 
addition, we are adopting new acquisition strategies to make more 
effective use of our information technology resources, including 
consolidating requirements into 15 prime contracts that will allow VA 
to leverage economies of scale and reduce IT spending.
    VA has also instituted a number of innovative practices to improve 
our energy efficiency and make more effective use of our resources. For 
example, the National Cemetery Administration (NCA) has implemented 
creative approaches to cemetery operations: the use of pre-placed 
crypts, that preserve land and reduce operating costs; application of 
``water-wise'' landscaping that conserves water and other resources; 
and installation of alternative energy products such as windmills and 
solar panels that supply power for facilities. NCA has also utilized 
biobased fuels that are homegrown and less damaging to the environment. 
NCA is developing an independent study of emerging burial practices 
throughout the world to inform its planning for the future.
    In the past two years, we have established and created management 
systems, disciplines, processes, and initiatives that help us eliminate 
waste. Financial and performance metrics provide the foundation for 
monthly performance reviews that are chaired by the Deputy Secretary. 
These monthly meetings play a vital role in monitoring performance 
throughout the Department, and are designed to ensure both operational 
efficiency and the achievement of key performance targets. In addition, 
a new budget review cycle was established to further strengthen 
stewardship of our financial resources. This cycle has three 
components: pre-year review; mid-year review; and post-year review. The 
Secretary chairs meetings in each review cycle to assess budget and 
operational efficiency and effectiveness.
    We also demonstrated our ongoing commitment to effective 
stewardship of our financial resources by obtaining our 12th 
consecutive unqualified (clean) audit opinion on VA's consolidated 
financial statements. In 2010, we were successful in remediating 3 of 4 
longstanding material weaknesses, a 75 percent reduction in just one 
year.

    Question 3. One of VA's integrated objectives is to ``educate and 
empower veterans and their families through outreach and advocacy.''
    A. VA-wide, how much in total was spent on outreach activities 
during fiscal year 2010, how much in total is expected to be spent on 
outreach activities during fiscal year 2011, and how much in total is 
requested for purposes of outreach activities during fiscal year 2012?
    Response. VA created the National Outreach Office within the Office 
of Public and Intergovernmental Affairs (OPIA) in FY 2010 to 
standardize how outreach is being conducted throughout VA. While we are 
not currently able to extract the total spending for outreach across 
the department for FY 2010 and FY 2011, we are working diligently 
toward that goal for FY 2012. VA has made considerable progress in 
researching and analyzing VA's outreach programs and activities and 
have developed a framework to guide us through creating a more 
efficient and effective approach to conducting outreach department-
wide, in support of VA's major initiatives. Key to the final plan is 
building a process that helps VA's administrations (Veterans Health 
Administration, Veterans Benefits Administration and National Cemetery 
Administration) and program offices:

     provide Veterans with high-quality products and activities 
that are consistent,
     provide outreach coordinators with training,
     evaluate and measure the effectiveness of outreach 
programs,
     track costs associated with outreach programs.

    B. What metrics are used by VA to gauge whether outreach efforts 
are effective?
    Response. Currently, VA's administrations and program offices 
coordinate and conduct their own outreach efforts. This includes the 
use of numerous methods to ensure it reaches the greatest number of 
Veterans, including the use of: direct mail, news media, paid 
advertising, community-based activities, and partnerships with other 
Federal agencies; Internet and social media (such as YouTube, Facebook, 
and Twitter); phone centers; and personal briefings to Veterans, 
Veterans Service Organizations (VSO), Military Service Organizations 
(MSO), state, regional and local governments, 200,000 dedicated VA 
volunteers, and other interested stakeholders.
    C. For fiscal year 2010, please provide VA's performance outcomes 
in terms of those metrics.
    Response. As referenced in Question B, ``What metrics are used by 
VA to gauge whether outreach efforts are effective?,'' the attached 
document, delivered to Congress December 2010, is the first step in 
analyzing VA's multitude of outreach activities and is serving as a 
baseline to develop a plan to yield the performance metrics necessary 
to determine the level of success of individual program efforts. What 
the report shows so far is the need to build a standard approach so 
each office conducting outreach can easily measure the value of their 
initiatives in serving Veterans. Again, building this process is 
necessary to providing data on VA's performance in outreach.
    D. For fiscal years 2011 and 2012, please provide VA's projected 
performance outcomes in terms of those metrics.
    Response. The Outreach Office established a workgroup made up of 
representatives from VHA, VBA and NCA and program offices like the 
Center for Women Veterans, OIF/OEF Case Management, Center for Minority 
Veterans, Small and Disadvantaged Business Utilization, Homeless 
Veterans and many others. The workgroup holds monthly meetings to 
coordinate input, solicit ideas and build buy-in for development and 
implementation of the overall outreach plan. Additionally, to ensure 
future outreach program success, the National Outreach Office will hold 
``Outreach Day'' at the 2011 National Office of Public and 
Intergovernmental Training Conference, to orient VA's directors 
responsible for outreach to the new standard--VA's outreach efforts are 
fiscally responsible, success is measurable and outreach efforts are 
based on sound research and well-planned strategies.
    E. Does VA collect and analyze any data or information that would 
allow a comparison of the effectiveness of one outreach approach over 
another? If so, please explain what information or data has been 
collected, what conclusions have been drawn from that information, and 
what has been done with respect to any activities found to be 
ineffective.
    Response. No. Currently, the only report on outreach available, the 
2010 Biennial Report to Congress on the Department of Veterans Affairs 
Outreach Activities, was submitted December 2010.

[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]


    Question 4. VA's FY 2010 Performance and Accountability Report 
reflects that independent auditors provided this assessment:

        Interest and administrative costs are required to be charged to 
        VA's delinquent debtors * * *. However, for 87 sample items out 
        of a total of 90 sample selections tested, [the Veterans 
        Benefits Administration (VBA)] did not charge interest or 
        administrative costs on delinquent payments * * *.
    The auditors concluded that VA is ``noncompliant with the Debt 
Collection Improvement Act of 1996'' and recommended that VA 
``[i]implement policies and procedures to assess applicable interest 
and administrative costs or propose a legislative remedy to request 
waiver of these requirements.''
    A. What actions has VA taken or does VA plan to take in response to 
that recommendation?
    Response. In accordance with 31 U.S.C. Sec. 3717 and 38 U.S.C. 
Sec. 5315, as well as the Federal Claims Collection Standards (31 CFR 
Parts 900-904), VA has published both regulation (38 CFR Sec. 1.915) 
and internal policy (VA Financial Policies and Procedures, Volume XII, 
Chapter 1A), which require that VA charge interest and administrative 
costs on all delinquent debts, including those that arise out of 
participation in VA benefit, medical care, or home loan programs. 
However, in 1992, the Deputy Secretary of Veterans Affairs made a 
decision not to implement the statutory interest and administrative 
charges on Compensation and Pension debts. This decision continues to 
be VA policy, which is referenced in Volume XII, Chapter 1A, and is 
also reported annually in VA's notes to the Consolidated Financial 
Statements. However, in 1992, the Deputy Secretary of Veterans Affairs 
made a decision not to implement interest and administrative charges on 
Compensation and Pension debts. This decision continues to be VA 
policy; it is referenced in Volume XII, Chapter 1A, and is also 
reported annually in VA's notes to the Consolidated Financial 
Statements.
    B. Currently, what is the total amount of outstanding delinquent 
debts?
    Response. At the end of FY 2010, VA's total outstanding delinquent 
debt was $1.3 billion. Of this total, $784 million was attributable to 
delinquent benefit debts.
    As of Feb 28, 2011, the outstanding debt balance for the C&P 
account is $1,145,841,464; for the Readjustment Benefits account, the 
debt balance is $368,171,435.
    As of December 31, 2010 the outstanding delinquent debt balance for 
the C&P account was $511,955,867. The majority of debts created for 
compensation are due to beneficiary death, incarceration and fugitive 
felons. The majority of pension debt is due to death of the beneficiary 
and change in income status. For the Readjustment Benefits account, the 
debt balance is $270,203,419. The majority of debt for the Readjustment 
account is due to changes in enrollment after tuition has been paid and 
delinquent debt on advance payments.

    Question 5. It is my understanding that, if an individual receives 
an overpayment of VA benefits, those funds might not be recouped by VA 
for a number of reasons, such as in circumstances where the debt to VA 
is waived or if efforts to recoup the overpayment are not successful.

    A. During fiscal year 2010, what was the total value of 
overpayments of benefits and what percentage of those overpayments were 
not recovered by VA for any reason?
    Response. In FY 2010, VBA recorded $1,552,691,000 in new debt. 
Including overpayments that were still open from prior fiscal years, 
the total available for collection was $2,812,152,000. During FY 2010, 
VA collected $1,232,819,000. This leaves 57 percent of the total debt 
available for collection. Of the total amount remaining, 50 percent is 
considered delinquent where VA is not currently recouping these funds 
through payment plans or offsets. However, when a debt is delinquent, 
VA continues to take action to recoup the funds by referring the debt 
to the Treasury Offset Program.

    B. For those overpayments of benefits that were not recouped by VA 
during fiscal year 2010, how many of the overpayments were the result 
of VA errors and what is the total value of un-recouped debts 
attributable to those errors?
    Response. VA systems do not track the source of the overpayment 
with the resolution of the overpayment. However, when an administrative 
error generates an overpayment, typically VA would have the means to 
recoup the overpayment from future payments to the recipient. In the 
2010 Performance and Accountability Report, VA reported 64 percent of 
our compensation improper payments and 34 percent of the pension 
improper payments were due to documentation and administrative errors. 
These percentages include both over and under payments.
    C. During fiscal year 2011, what is the total value of benefit 
overpayments that are not expected to be recouped?
    Response. For FY 2009 and FY 2010, around 20% of established debt 
for C&P has been deemed uncollectable. If this figure remains constant 
for FY 2011, this would be $234 million deemed uncollectable for C&P. 
For Education, the rate is around 8%, which would equate to $22 
million. It should be noted that although a debt is currently deemed 
uncollectable, it can be re-established and collected if benefits 
resume.
    D. Does the budget request for fiscal year 2012 include funding for 
benefits that are projected to be overpaid and not recouped? If so, 
what is that amount and where is it accounted for in the budget 
request?
    Response. In the calculation for the FY 2012 President' Budget 
request, the Readjustment Benefits account is projecting a net increase 
of $7.2 million in obligations associated with overpayments. This 
projection is based on historical trends and updated each budget cycle. 
This $7.2 million obligation is included in the chapter 33-obligation 
estimate of $8,481.2 million found on page 2B-2 of the budget. While 
obligations for the net increase are incorporated into the budget, 
these amounts may be collected in the future and are not identified as 
funds that VA does not expect to recoup. Although there is no specific 
line item for overpayments in the budget request for the Compensation 
and Pension account, these payments are accounted for in the baseline 
budget estimates and are not identified as funds that VA does not 
expect to recoup.
    E. Do any performance measures for claims processing staff, service 
center managers, or regional office directors take directly into 
account the amount of un-recouped benefit overpayments attributable to 
their errors or errors of their subordinates?
    Response. No, VA systems do not track this information.

    Question 6. VA's Central Office is located in Washington, DC, and 
houses a number of different entities, such as the Office of the 
Secretary, the Office of Congressional and Legislative Affairs, and 
other support offices.
    A. How many employees were assigned or detailed to VA's Central 
Office during fiscal year 2008, during fiscal year 2009, and during 
fiscal year 2010?
    Response. Employees assigned to VA's Central office. (Identified 
employees at station 101 or 101 with any duty station).

          FY 08: 4991
          FY 09: 4518
          FY 10: 4997

    The reasons for the drop from FY 2008 to FY 2009 is that OIT lost 
249 employees at the VA Central Office and OIG had 462 employees 
transferred out of PAID because PAID/VA was no longer servicing them 
for H.R. or payroll. Note: FY 2009 and FY 2010 totals do not include 
OIG.
    B. How many employees currently are assigned or detailed to VA's 
Central Office?
    Response. As of the 3/13/2011 PAID Master File, there are 4861 
employees assigned to VA's Central office.
    C. If VA's fiscal year 2012 budget request is adopted, how many 
employees would be assigned or detailed to VA's Central Office during 
fiscal year 2012?
    Response. VA does not project the number of employees that will be 
funded in budget requests, but rather estimates the number of full time 
equivalents (FTE) that can be supported by the budget. During FY 2012, 
VA estimates the General Administration Account will have 2,442 FTE at 
headquarters and 873 FTE in the field. In a normal year, one FTE 
generally equals 2,088 hours of work per year. The number of employees 
will be higher than the FTE reported in the budget due to the fact that 
VA employs both full time and part time employees.
    D. In total, how many contractors and consultants are providing 
services directly to the staff offices at VA Central Office?
    Response. The number of contractors that serve staff offices at 
VACO is 771.
      i. What percentage and dollar amount of these contracts does VA 
Central Office award to veteran-owned small businesses and service-
disabled veteran-owned small businesses?
    Response to 6D and 6Di: At this time, VA is unable to provide a 
complete response to this question as a data analysis of VA's service 
contracts is currently underway as part of a requirement set by section 
743 of the FY 2010 Consolidated Appropriations Act (Public Law 111-
117), which require civilian agencies subject to the Federal Activities 
Inventory Reform Act of 1998 (Public Law 105-270; 31 U.S.C. 501) to 
prepare an annual inventory of their service contracts.
    On November 5, 2010, the Office of Management & Budget's (OMB) 
issued guidance to Federal agencies on preparing their inventories of 
service contracts for fiscal year (FY) 2010 which included the 
requirement to analyze the inventory data to determine if contract 
labor is being used appropriately and effectively and if the mix of 
Federal employees and contractors is effectively balanced. VA 
identified 27,810 number of service contracts Nation-wide and summary 
information of FY 2010 inventory is currently available to the public 
at: www.va.gov/oamm/rlib/scainventory.cfm. The inventories include all 
service contract actions over $25,000 awarded in the specified fiscal 
year. The inventories consist of funded contract actions including 
contract actions made on the Department's behalf by other agencies. 
Similarly, the lists exclude contract actions made by the Department on 
another agency's behalf with the other agency's funding.
    The analysis of this data is ongoing and will be supplemented with 
the specific request of information regarding the VA Central Office 
awards to veteran-owned and service-disabled veteran-owned small 
businesses. In accordance with the OMB guidelines, VA expects this 
analysis to be complete by June 30, 2011.''
    E. I recently received a breakdown of each of the 89 positions 
within the Office of the Secretary, which includes an ``Ombudsman/Non-
Governmental Affairs'' at a General Schedule (GS)-15 pay level, a non-
career Staff Assistant (GS-11); three Special Assistants/Staff 
Coordinators at GS-9, 11 and 12; three Executive Correspondence 
Analysts at GS-15; two Executive Writers at GS-13 and 14; two 
Correspondence Analysts at GS-12 and 13; and a Supervisory 
Correspondence Analyst at GS-13.
          i. For each of these positions, please describe their 
        responsibilities.
    Response. The Ombudsman/Non-Governmental Affairs position includes: 
serving as a primary access point for Non-Governmental Organizations 
(NGO's) to VA resources, departmental contacts, Veteran data, and VA 
needs; facilitating opportunities for collaborations with NGO's that 
supplement VA's services and supports for Veterans, their families, and 
survivors; promoting complimentary missions that reduce duplication; 
providing consultation to the Secretary and other Executive Leadership 
on key NGO matters; and maintaining an extensive network of NGO 
contacts.
    As examples of the activities of this position, during FY 2011 to 
date, the Ombudsman/NGO has: provided over 174 consultations on, or to, 
NGO's about VA, NGO community awareness, public/private working 
relationships, Veterans and their families' needs, and many other 
related topics; provided 85 NGO's serving Veterans with 153 internal 
and external referrals to other key resources; worked with more than 10 
NGO's serving Veterans to create collaborations that benefit VA, 
Veterans and their families; represented VA at 17 external Veteran 
community events; vetted 11 NGO's for senior leader meetings; conducted 
in-depth research on 43 NGO's; and developed and managed a 205 member 
NGO network distribution list.
    The non-career Staff Assistant position includes: strategic 
communication planning for announcements, roll-out events, and 
initiatives to include video releases and video production; and special 
events to include briefing and staffing especially to support special 
communications projects planning and execution. As examples of the 
activities of this position, during FY 2011 to date, the Staff 
Assistant has: supported Caregivers legislation implementation plan 
distribution to VA stakeholders; served as executive producer of at 
least 5 videos used in both internal and external communications; 
oversaw and advised on various major communications initiatives; 
planned and coordinated several events for VA leadership to reinforce 
VA's homelessness program (e.g., DC VAMC Homelessness Stand Down, 
Homeless Point in Time Count) and a major Senior Leadership Conference.
    Three Special Assistants/Staff Coordinators: This pivotal support 
team serves as a direct staff coordinating element for senior 
leadership of the Department. They are responsible for a variety of 
duties relative to planning, executing and recording the day-to-day 
operational activities for the Secretary of Veterans Affairs, Deputy 
Secretary and Chief of Staff. This team serves as a direct link between 
the Department leaders, principal staff, and key leadership throughout 
the Department. During FY 2010, this team was responsible for 
scheduling coordination, documenting and executing related follow-on 
tasks for approximately 1,300 meetings.
    This team is also responsible for planning, staffing, and executing 
travel for the leaders in the Office of the Secretary. They develop 
complex schedules to meet the intent of senior leadership to achieve 
maximum efficiencies and ensure that the purpose and outcomes of the 
site visit is achieved. Coordination requires involvement of VA 
facility leadership throughout the Continental United States, and both 
national and local government officials, to include Members of Congress 
and their staff. Responsibilities include coordination and execution of 
travel to international locations. This team planned and executed more 
than 40 site visits in FY 2010 including two overseas.
    The Office of the Secretary of Veterans Affairs' (OSVA) Executive 
Secretariat has a team of staff that is responsible for all business 
documents and correspondence that require action and signature by the 
Secretary, Deputy Secretary, and Chief of Staff. The Executive 
Secretariat positions described below fulfill many of these 
responsibilities for OSVA.
    Three Executive Correspondence Analysts; two Executive Writers: 
This is a team of writers/reviewers that are responsible for the daily 
processing and preparation of Executive correspondence for the Office 
of the Secretary. These analysts and writers processed more than 1,800 
documents, to include drafting approximately 400 written responses on 
average in each of the last 3 years. Correspondence includes responses 
to Members of Congress, Federal, state and local officials, private 
sector organizations, and internal VA memorandums. The team assured 
accuracy for content, grammar and consistency of Department positions 
as well as proper coordination and vetting across all VA elements. This 
staff also conducted individual and group training for correspondence 
officials across VA--training more than 300 employees in 2010. In 
addition to correspondence and decision documents, these employees 
reviewed and edited all testimony and questions for the record.
    Two Correspondence Analysts: These employees prepare, arrange and 
control correspondence packages for final presentation to Senior 
Officials. They assure the package contains the necessary information, 
in the correct order, and then process it after signature for dispatch. 
They also ensure the official record is complete and in each of the 
last 4 fiscal years averaged processing approximately1500 items.
    One Supervisory Correspondence Analyst: This employee supervises 3 
persons to include those that process and assign all incoming mail 
(approximately 12,000 items per year) and those that answer Office of 
the Secretary telephones (average more than 70 calls a day). This 
employee also serves as the Records Management Officer and FOIA Officer 
for the Office of the Secretary.
    All of the employees in this section operate an electronic document 
management tracking system daily.

          ii. Please explain how the staff is of direct benefit to 
        veterans.
    Response. Veterans directly benefit from the important work 
performed by each employee assigned to the Office of the Secretary of 
Veterans Affairs (OSVA). On a daily basis, the OSVA directly supports 
the Secretary's mission to transform the Department into a 21st Century 
organization that is people-centric, results-driven, and forward-
looking. OSVA staff is responsible for facilitating effective 
coordination and cooperation between the Secretary's office and various 
organizations and stakeholders involved in Veterans' affairs. They 
implement and oversee various programs, communicate priorities and 
issues, and prepare correspondence on behalf of the Department.
    The OSVA's overall size includes the staff positions described 
above, as well as other positions and congressionally established 
offices. The OSVA is compromised of the following:

     Center for Women Veterans Affairs (CWV)--this office was 
established by Congress in November 1994, and serves as the primary 
advisor to the Secretary on all matters related to policies, 
legislation, programs, issues, and initiatives affecting women 
Veterans. CWV's mission is to monitor and coordinate VA's 
administration of health care and benefits services and programs for 
women Veterans.
     Center for Minority Veterans (CMV)--CMV was mandated by 
Congress in 1994, under Title 38 Public Law 103-446, Section 509. It 
serves as an advocate for minority Veterans by conducting outreach 
activities to promote the awareness and use of Veteran benefits and 
services by evaluating the overall effectiveness of the provisions of 
VA benefits and services.
     Office of Survivors Assistance (OSA)--OSA was established 
by Public Law 110-389, Title II, Section 222, in October 2008. Its 
mission is to serve as the principal advisor to the Secretary on all 
policies, programs, legislative issues, and other initiatives affecting 
survivors and dependents of deceased Veterans and Servicemembers.
     Office of Employment Discrimination Complaint Adjudication 
(OEDCA)--OEDCA is an independent Department of Veterans Affairs 
adjudicatory authority created by Congress and established in 
February 1998. Its mission is to objectively review the merits of 
employment discrimination claims filed by present and former VA 
employees and non-agency applicants for employment.
     Center for Faith-based and Neighborhood Partnership 
(CFBNP)--This Center was established on June 1, 2004, by Executive 
Order 13342. Its mission is to develop partnerships and provide 
relevant information to faith-based and secular organizations and 
expand their participation in VA programs in order to better serve the 
needs of Veterans, their families, and survivors.
     Executive Secretariat--this office is responsible for all 
administrative operations for the OSVA. The Executive Secretariat 
serves as the process owner for administrative procedures in the 
Department of Veterans Affairs Central Office. In addition, the 
Executive Secretariat is responsible for all business documents and 
correspondence that require action and signature by the Secretary and 
Deputy Secretary, such as policy development, personnel actions 
centralized to the Secretary, review of congressional testimony and 
responses to pre- and post-hearing questions, spending proposals, 
regulations, reorganizations, and legislation; the Executive 
Secretariat is the business owner for the Department's electronic 
document management and tracking system.
     Office of the Secretary Special Staff--this special staff 
includes VA's senior leadership's special assistants and senior 
advisors. This special staff coordinates travel, meetings, and 
executive briefings; facilitates correspondence; conducts liaison with 
stakeholders, and assists in VA's transformation through analysis and 
oversight activity. The special staff also includes non-career staff 
and advisors such as the Chief Technology Officer, VA Innovation 
Initiative Program Director, and White House liaison.

    Since Secretary Shinseki's arrival in January 2009, the OSVA staff 
has been a significant contributor to this organization's programs and 
accomplishments on behalf of Veterans, their families, and survivors. 
They have been instrumental in establishing a more accountable, 
transparent and enterprise-wise culture within VA. Accomplishments at 
VA--with the help of OSVA--are many, but much work remains. VA has 
helped deliver benefits for the Post-9/11 GI Bill under a compressed 
timeline and has dramatically improved collaboration with DOD in many 
areas. From the development of Electronic Health Records to a 
continuously improving eBenefits system that gives Servicemembers and 
Veterans direct access to their records, VA is delivering for Veterans. 
OSVA is an indispensible part of the VA team.

    Question 7. Last year, the President signed the Patient Protection 
and Affordable Care Act (PPACA) into law and that will affect all areas 
of health delivery in this country.
    A. How will the PPACA affect the workload of the Veterans Health 
Administration (VHA)?
    Response. VA has been carefully assessing the potential impact of 
the Affordable Care Act (ACA) since its enactment. VA's partnership 
with its consulting health actuary, Milliman, has positioned VA well to 
assess the potential impact of health reform on VA. Preliminary 
analyses have looked at understanding how the ACA could impact VA's 
health care system and to what extent various Model factors such as 
enrollment, reliance, and morbidity are expected to change. Based on 
our assessment of the Act, we believe that VA's Medical Benefit Package 
meets the minimum essential coverage provisions of the ACA. There are 
also administrative requirements in the Act that could increase VA's 
resource requirements such as those associated with data sharing with 
HHS.
    B. What steps did VA take to reflect any increase or decrease as a 
result of the PPACA in this year's budget request?
    Response. The ACA establishes the Indian Health Services (IHS) as 
the payer of last resort for all health programs operated by the Indian 
Health Service, Indian tribes, tribal organizations, and Urban Indian 
organizations. Section 10221 authorizes IHS to establish Sharing 
Arrangements with Federal Agencies. The cost of health care to IHS will 
be reduced and transferred to VHA. The FY 2012 budget submission 
includes $52 million in 2012 and $57 million in 2013 for reimbursement 
to IHS. At this time, VA does not have a clear view of the expected 
financial impact of this law, but will continue to monitor developments 
as additional information and clarification is received.
    C. What will be the impact of the health care reform act on VA's 
budget in long term projection models?
    Response. Beyond the funds requested in the 2012/2013 budget 
submission (response 7b above), VA does not have a clear view of the 
expected financial impact of this law, but will continue to monitor 
developments as additional information and clarification is received.

    Question 8. Recently, VA announced the creation of two new 
offices--the Office of Patient Centered Care and Cultural 
Transformation under VHA and the Office of Tribal Government Relations.
    A. In what way did VA take into consideration the current budgetary 
restraints the country finds itself in while creating these offices?
    Response. The Patient Centered Care (PCC) effort is one of many 
transformation initiatives in the Department's Strategic Plan. These 
major initiatives are designed to improve the value of VA health care--
safety, quality, efficiency, and the experience patients and their 
families have when they obtain VA health care services. A cost benefit 
analysis was attempted before undertaking our PCC initiative. A 
literature review suggested that many private sector organizations that 
have adopted similar patient care principles have realized economic 
returns on that investment. For example, patients tend to have shorter 
hospital stays and make different decisions about end of life care.
    After reviewing the evidence, we felt that there was not enough 
specific data to do a formal return on investment analysis. On the 
other hand, patient centered care approaches are rapidly becoming the 
norm in private health care. The Joint Commission has recently 
published proposed standards that will be incorporated into their 
accreditation requirements. Recognizing the evolving industry standards 
and the needs of Veterans, VA has undertaken this initiative to craft 
standards and programs that are best aligned with our unique mission 
and patient population. We do expect many of the necessary changes can 
easily be accomplished within existing resources and will improve 
patient satisfaction and quality outcomes.
    OPIA's initiative to Enhance Partnerships with Tribal Governments 
is a cost effective way to build positive partnerships with tribal 
governments (i.e., partnerships equivalent to those VA engages in with 
state and local municipalities) with whom the Federal Government 
already has a unique political relationship. This effort will result in 
informed decisionmaking within VA when it comes to policy, program 
planning and priority setting as the agency serves this population of 
American Indian/Alaska Native (AI/AN) Veterans. Consequently, informed 
decisionmaking results in smarter use of fiscal resources and better 
outcomes for AI/AN Veterans. Twelve percent (12%) of AIANs in the US 
are Veterans, one of the highest per capita populations of Veterans in 
any ethnic group. Simultaneously with their exceptionally high rates of 
military service, AIANs are also one of the most vulnerable 
populations. Approximately 25% of AIANs live in poverty and they have 
higher obesity (23.9%) that any other racial/ethnic group (CDC, 2003). 
Thirty-three percent (33%) of AI/ANs had no health insurance coverage 
in 2007; of those with coverage, 24% relied on Medicaid (DHHS). 
Currently VA has one quarter of a single employee (.25 FTE) dedicated 
to Native American issues. VA has an opportunity to demonstrate its 
support of AI/AN populations with a relatively low cost through this 
OPIA office with five full time employees.
    More importantly, VA has an opportunity to reduce AINA Veterans' 
reliance on Medicaid as well as to increase preventative care that 
reduces later VA medical costs. For example, one of OPIA's current 
efforts is to jointly coordinate access for VA's mobile clinics and 
mobile Vet Centers to tribal lands. This is key to fighting obesity 
among AI/AN populations. Obesity is associated with diseases such as 
diabetes, cardiovascular disease, hypertension, coronary heart disease 
and cancer (CDC). A 2003 study on diabetes estimates that it costs 
$13,243 per patient to treat diabetes compared to $2,560 for patients 
without diabetes
    If OPIA can increase access for VA preventative healthcare and keep 
just 1% AIAN vets from developing diabetes, VA will save well more than 
the $800,000 cost for this initiative in OPIA's FY 2011 budget.
    B. How many additional full-time equivalents (FTEs) and how much 
increased funding did VA request for each new office in this request?
    Response. There are five FTEs. VA requested $800,000 to fund these 
offices.
    C. Under whose direction will the Office of Tribal Government 
Relations operate?
    Response. The Assistant Secretary for Public and Intergovernmental 
Affairs.
    D. How many people will the office of Tribal Government Relations 
serve?
    Response. According to the 2008 Census Bureau American Community 
Survey, there are 160,471 American Indian/Alaska Native Veterans. There 
are 565 federally recognized Tribes (tribal governments). The Office 
will be working with tribal governments as political entities on a 
Nation-to-nation (inter-governmental) basis to facilitate communication 
between the Department of Veterans Affairs and tribal governments.
    E. Are there any other new offices currently in the planning stages 
to be rolled out this year? If so, please explain.
    Response. There are no new offices in the planning stages to be 
rolled out this year in OPIA.
    F. Can these services be met through any office currently in 
existence within VA? If so, please detail which offices and why was it 
not considered to expand an existing office rather than creating a new 
one.
    Response. No, the Office of Tribal Government Relations (OTGR) 
office is located within the Office of Public and Inter-Governmental 
Affairs. The office serves the needs of the VA in relation to 
incorporating key stakeholder perspectives (in this instance tribal 
governments) as they apply to cross-cutting issues affecting all three 
Administrations in VA. Therefore, the best ``home'' for the OTGR is 
within an office located at the Departmental level.

    Question 9. The Office of Congressional and Legislative Affairs 
(OCLA) is requesting funding for an estimated 52 FTEs in fiscal year 
2012, which is a 44% increase over fiscal year 2010. In addition, each 
programs office under VHA and VBA has Congressional liaison staff also 
tasked with working with the Hill.
    A. Please explain the functions performed by OCLA and the 
Congressional liaisons of VHA and VBA. In what areas do they overlap?
    Response. The Office of Congressional and Legislative Affairs 
(OCLA) is the lead office responsible for maintaining open 
communications with Congress through briefings, meetings, calls, 
hearings, site visits, written communications, reports, and responses 
to requests for information. OCLA also maintains constituent casework 
offices on Capitol Hill to support Congressional offices' Veterans, 
dependents, and survivors casework. Additionally, OCLA is responsible 
for liaison with the U.S. Government Accountability Office (GAO) and 
coordinates all meetings and correspondence with the agency. During FY 
2010, OCLA supported 105 hearings, 322 information briefings, 
coordinated the responses to over 1,240 questions for the record, 
responded to over 7,100 written and over 15,000 telephonic requests for 
information, and countless e-mails, and supported approximately 100 
oversight visits. In FY 2010, OCLA also coordinated the VA response to 
50 GAO reports that focused on VA issues. In the FY 2012 budget 
request, OCLA will assume the funding for the Office of Advisory 
Committee Management, which is responsible for supporting the VA's 
advisory committees. The Office of Advisory Committee Management 
supported 23 advisories committees and 54 advisory committee meetings 
during FY 2010.
    The Congressional liaisons assigned to VHA and VBA are the conduit 
for the flow of information between OCLA and the VA Administrations. 
Each liaison facilitates the accurate assignment within their 
respective Administration, manages their Administration's responses to 
Congress, and tracks actions until they are completed and delivered to 
Congress. There is no overlap of duties between the Administration 
Congressional liaisons and OCLA personnel.

    Question 10. The deadline for full implementation of the caregivers 
program as mandated in the Caregivers and Veterans Omnibus Health 
Services Act of 2010 (Public Law 111-163) has passed with only the plan 
for implementation presented to Congress a few weeks ago.
    A. When does VA intend to move to full implementation of the family 
caregiver program?
    Response. VA has identified below a general timeline with goals for 
implementing the family caregiver program required by title I of Public 
Law (PL) 111-163, the Caregivers and Veterans Omnibus Health Services 
Act of 2010. VA's planning and work on regulations has been ongoing 
since before the Caregivers and Veterans Omnibus Health Services Act of 
2010 was signed into law. This work has continued throughout the time 
the Implementation Plan was under development. VA is working as quickly 
and responsibly as possible to deliver these enhanced benefits to 
eligible Veterans and their caregivers and will keep the Committee 
closely apprised of its progress.

Create Caregiver Support Line
Hire All Caregiver Support Coordinators
New State-of-the-Art Web Site
  February 1, 2011 (completed)
  April 2011
  May 2011

    On February 28, 2011, VA transmitted a draft Interim Final Rule to 
the Office of Management and Budget. We believe this measure will 
expedite the rulemaking process and set the path to begin delivering 
caregiver benefits as early as this summer.
    B. How is the implementation reflected in the FY 2012 budget? How 
much funding is allotted for this program and under which accounts?
    Response. VA will be updating the cost estimates for the 
implementation of the Caregiver Act. These costs cannot be finalized 
while the Interim Final Rule is pending. VA will continue to keep the 
Committee informed, including providing our final estimate, once the 
process is completed.

    Question 11. VA recently announced that it plans to reorganize the 
Veterans Benefits Administration.
    A. Will this reorganization result in the creation of additional 
positions or elimination of positions within VBA? If so, please specify 
the number of positions that will be created or eliminated and the 
nature of those positions.
    Response. Eight new positions are created as a result of the 
reorganization:

     Director, Office of Strategic Planning
     Director, Veterans Benefits Management System
     Director, Veterans Relationship Management Program
     Deputy Chief of Staff
     Deputy Under Secretary for Economic Opportunity
     Director, Pension and Fiduciary Service
     Assistant Director for Pension
     Assistant Director for Fiduciary
    No positions are eliminated as a result of the reorganization.

    The following positions are re-titled under the reorganization:

     Deputy Under Secretary for Benefits now titled Principal 
Deputy Under Secretary for Benefits
     Associate Deputy Under Secretary for Policy and Program 
Management now titled Deputy Under Secretary for Disability Assistance
     Associate Deputy Under Secretary for Field Operations now 
titled Deputy Under Secretary for Field Operations
     Associate Deputy Under Secretary for Management now titled 
Director, Office of Management
     Director, Compensation and Pension Service, now titled 
Director, Compensation Service
    B. What level of funding is needed for the reorganization effort?
    Response. No additional funding is need for this reorganization. It 
will be carried out within existing funding levels.
    C. Does the fiscal year 2012 budget request include any necessary 
funding to carry out this reorganization?
    Response. No additional funding is requested in the FY 2012 budget 
to carry out this reorganization.

    Question 12. In the General Administration budget request, Volume 
III page 5A-7, there is a chart entitled ``Employment Summary--FTE by 
Grade,'' which breaks down proposed General Administration hiring for 
fiscal year 2012. The current request is for 3,315 General 
Administration employees, which would be almost 6% more than the 2011 
Continuing Resolution (CR) level and 20% over the fiscal year 2010 
actual level. Of the proposed 176 employee increase over last year, 148 
of these jobs are at GS-12 or higher. This chart also breaks out Senior 
Executive Service (SES) employees. If VA's request is met, there will 
be 105 SES employees, an increase of 32 over a two-year period and 
seven more than last year.
    A. How will these staffing increases be of direct benefit to our 
Nation's veterans?
    Response. Half (88) of the 176 FTE increase between 2011 and 2012 
is for resident engineers within the Office of Acquisition, Logistics & 
Construction, who will provide necessary oversight of construction 
projects at VA facilities nationwide. The remaining FTE increases fall 
primarily across four staff offices: the Office of Human Resources & 
Administration, Office of Policy & Planning, Office of Security & 
Preparedness, and the Office of Management. These FTE will support the 
Secretary's Transformation initiatives including: the Human Capital 
Investment Plan, VA DOD collaboration activities, Homeland Security 
Presidential Directives implementation and compliance, and financial 
audits of Non-VA Care (Fee) programs. These investments are expected to 
significantly improve how VA delivers services to Veterans and their 
families in the near term.
    B. Please explain what specific functions these new SES employees 
will perform.
    Response. Of the 32 SES level positions above 2010, 27 were 
positions approved prior to FY 2012, The distribution of these 32 SES 
level positions is as follows:

     10 General Schedule positions within the Office of General 
Counsel converted to SES (Regional Counsels in the field)
     9 positions within the Office of Policy and Planning 
including those of the Deputy Assistant Secretary (DAS) for Policy (1), 
DAS for Data & Evaluation (1), Chief Actuary (1), and the Enterprise 
Project Management Office (ePMO) (5)
     6 positions within the Office of Management: Executive 
Director of Operations(1), Director, Office of Performance Management 
(1), Financial Operations (1), Office of Asset Enterprise Mgt.-Green 
Management (1), Office of Budget (2)
     3 positions within the Office of Acquisitions, Logistics, 
and Construction to lead Facilities Acquisition (1), Facilities 
Programs and Plans (1), and Engineering Operations Support (1).
     3 positions within the Office of the Secretary
     1 position within the Office of Security and Preparedness: 
Director of Personnel Security & Identity Management; lead for 
Secretary's Preparedness Initiative
    C. What is the additional cost for these additional FTEs?
    Response. The average annual salary for General Administration FTE 
is about $93.7 thousand. However, for the 148 FTE (Grade 12 or higher) 
cited above the average annual salary is approximately $98 thousand. 
The additional cost for 148 FTE is:

    148 FTE  $98 thousand  1.27% (fringe benefits %) = $18.4 million 
per year.

    Question 13. Another chart available in the budget, Volume III page 
5-A8, has a breakout of fiscal year 2010 FTE in two categories, Field 
and Headquarters (HQ). According to this chart, in fiscal year 2010, 
2,028 FTE within the General Administration worked at HQ and 725 in the 
Field. Please provide a similar breakdown for the requested FTE for 
fiscal year 2012.
    Response:

    [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
    
                         readjustment benefits
    Question 1. The fiscal year 2012 budget request appears to reflect 
(in Volume 3, page 2B-3) that the average cost of automobile grants 
during fiscal year 2012 will be $11,000. Does this estimate take into 
account Public Law 111-275, which increased the automotive assistance 
allowance? If not, please provide a revised estimate including the 
impact of Public Law 111-275.
    Response. The FY 2012 Budget Submission did not include the cost of 
the increased automobile grants provided by section 804 of Pub. L. 111-
275. Including the impact of the increase from FY 2011 of $11,000 to FY 
2012 of $18,900, the cost of the Automobile Grant Program will increase 
by $14.5M in FY 2012. These increased costs will be reflected in the 
Mid Session Review Readjustment Benefits model update.

    Question 2. The fiscal year 2012 budget request reflects that 
changes made by Public Law 111-377, the Post-9/11 Veterans Educational 
Assistance Improvements Act of 2010, were ``not incorporated into this 
budget.'' Please provide updated estimates of the workload, average 
cost, and total cost of readjustment benefits based on the changes made 
by that new law.
    Response. The impact of Public Law 111-377 is currently being 
assessed by VA staff and will be fully incorporated into the release of 
the 2012 Mid Session Review Budget.

    Question 3. The fiscal year 2012 budget request with respect to 
readjustment benefits includes this explanation: ``The average cost per 
trainee is highest for chapter 33, reaching $16,527 in 2012. Chapter 30 
average costs per trainee ($8,061 by 2012) are less than chapter 33, 
causing the majority of eligible trainees to transfer programs.'' To 
date, how many trainees have transferred to chapter 33 from chapter 30 
and how many additional trainees are expected to transfer to chapter 33 
during fiscal year 2012?
    Response. We do not have data to identify the number of trainees 
that have transferred from chapter 30 to chapter 33. We do know that 
the number of chapter 30 trainees decreased by nearly 95,000 from FY 
2009 to FY 2010. Additionally, we know that approximately 36,400 
individuals used both chapter 30 and chapter 33 benefits during fiscal 
year 2010. At this time, we are unable to forecast the number of 
trainees expected to transfer to chapter 33 from chapter 30 during FY 
2012.
                vocational rehabilitation and employment
    Question 1. The fiscal year 2012 budget request reflects that the 
Vocational Rehabilitation and Employment (VR&E) program expects to 
spend $897,000 on equipment during fiscal year 2011 and requests $2.4 
million to spend on equipment during fiscal year 2012. What factors 
account for this over 168% increase?
    Response. Equipment costs increase to support the hiring of 
additional FTE for the IDES and VetSuccess on Campus initiatives and 
for VR&E's share of infrastructure improvements for the co-location and 
relocation of VBA facilities.

    Question 2. The fiscal year 2012 budget request reflects that the 
Vocational Rehabilitation and Employment program expects to spend $3 
million on travel during fiscal year 2011 and requests $3.5 million to 
spend on travel during fiscal year 2012.
    A. What factors account for this 16% increase in travel expenses?
    Response. Increased travel costs support the training of new VR&E 
counselors hired for the IDES and VetSuccess on Campus initiatives and 
increased oversight to IDES and VetSuccess On Campus locations.
    B. How many employees are expected to travel during fiscal year 
2012, what is the purpose of the travel, and what is the expected 
average cost for each trip?
    Response. Training requirements for new counselors hired for the 
IDES and VetSuccess on Campus initiatives will entail travel for 
approximately 119 new counselors. Approximately two or three oversight 
personnel will be required to travel to each of the 17 stations that 
are responsible for VetSuccess on Campus locations and comparably for 
the IDES locations. The cost of each trip will vary depending on the 
location of the new counselors and oversight staff and their 
destinations but the approximate average cost is $1,500 for one week.

    Question 3. For fiscal year 2012, the Vocational Rehabilitation and 
Employment program requests additional employees in order to provide 
services in connection with the Integrated Disability Evaluation System 
(IDES). The budget request provides this description: ``With mandatory 
counseling services, we will assist Servicemembers in developing 
vocational goals and commencing vocational rehabilitation services to 
support their successful transition from the military to their home 
communities.''
    A. Have VA and the Department of Defense (DOD) finalized a plan for 
including services from the Vocational Rehabilitation and Employment 
program in the IDES process? If so, please explain when the plan was 
completed and provide the specifics of that plan.
    Response. VA and DOD are developing a plan for expansion of VR&E 
into the IDES process. The plan has not been finalized.
    B. At what point during the IDES process would mandatory counseling 
take place?
    Response. Servicemembers would participate in a mandatory 
counseling appointment when referred to the Physical Evaluation Board. 
Vocational Rehabilitation Counselors will receive referrals for 
appointment scheduling in collaboration with the Physical Evaluation 
Board Liaison Officers and Military Service Coordinators.
    C. Would those counseling services be expected to add to the length 
of the IDES process?
    Response. The counseling services are not expected to add to the 
length of the IDES process.
    D. Would counseling be mandatory for servicemembers in regular 
components of the military who have already secured civilian employment 
for after they are discharged from service?
    Response. The initial counseling appointment would be mandatory for 
every Servicemember referred to the Physical Evaluation Board through 
the IDES process.
    E. Would counseling be mandatory for members of the Guard or 
Reserves in the IDES process who have civilian jobs?
    Response. The initial counseling appointment would be mandatory for 
all Guard and Reserve members referred to the Physical Evaluation Board 
through the IDES process.

    Question 4. In the fiscal year 2012 budget request, there is an 
increase of 60 FTE due to the realignment of funds currently used to 
purchase contract counseling services to hire additional vocational 
rehabilitation and employment counselors.
    A. What metric was used determine it was more effective and 
efficient to hire the additional vocational rehabilitation and 
employment counselors?
    Response. VA compared total costs and quality of service of FTE 
against that of contract counselors. FTE total costs and performance 
metrics such as average rehabilitation rate and Veteran feedback were 
compared against FY 2010 contracting rates and contractor quality of 
service analysis from case mangers. The analysis indicated savings to 
the government and better service to Veterans when VR&E counselors were 
used. Contract counselors are still used to supplement services VA 
provides to Veterans, including serving Veterans in remote areas.
    B. What is the average caseload for FTE counselors versus contract 
counselors?
    Response. Contractors in the last national contract were capped at 
a 125 Veterans per counselor. In FY 2010 VR&E counselors carried an 
average caseload of 136 cases.
    C. Will the decrease in contract counseling services negatively 
impact veterans living in rural or underserved areas? Please explain.
    Response. VR&E estimates the increased staffing levels and funding 
in the FY 2012 budget request for contract counseling services will 
help continue our high level of service to Veterans living in rural 
areas. Further, VR&E has successfully piloted remote counseling 
technology to enhance services provided to Veterans living in rural 
areas and/or who have difficulty with transportation due to disability. 
The success of remote counseling with both Veterans and counselors has 
prompted VR&E Service to begin national implementation in FY 2011.
    D. What performance measures does VA use to evaluate the 
effectiveness of contract counseling services?
    Response:

    Coverage of Jurisdiction--Contractor shall have an adequate number 
of trained counseling staff to ensure provision of services for Veteran 
clientele throughout the Regional Office jurisdiction.
    Responsiveness--Contractor shall submit accurate timely reports 
detailing services provided and additional service needs until 
rehabilitation or closure of the case. These reports must be in 
accordance with the M28 manual and the report format identified in the 
contract.
    Customer Satisfaction--Contractor shall provide a level of service 
that is responsive to Veteran or eligible dependents' needs, as 
evidenced by positive feedback from clients, lack of complaints, and 
periodic contact of clients by VR&E to assess customer satisfaction.

    Question 5. The Vocational Rehabilitation Assistance Study 
identified the need to incorporate VR&E services into the IDES. In the 
fiscal year 2012 budget request, VA seeks $16.2 million to employ 110 
FTE at the largest IDES locations.
    A. At what IDES locations will the FTE be employed?
    Response. The IDES installations where VR&E FTE will be assigned 
have not been finalized. VA is coordinating with DOD to identify 
locations.
    B. How does VA plan to monitor the effectiveness of this 
initiative?
    Response. VA will keep data on all participants in the IDES 
process. Participation rates will be assessed by the number of 
Servicemembers that begin the IDES process and receive a rating in 
addition to those that participate in a rehabilitation and/or education 
benefit program.

    Question 6. For the fiscal year 2012 request, the VetSuccess on 
Campus seeks almost $1.1 million for the continuation of the eight 
pilot campuses and nine additional campuses. Please list the additional 
nine campuses and explain how the additional sites were determined?
    Response. The additional nine campuses for 2012 expansion of 
VetSuccess on Campus have not been identified. A list of schools that 
meet basic criteria such as number of Veterans on campus, proximity to 
VA resources, and availability of space on campus, will be used to 
select the nine campus locations.
                                housing
    Question 1. The fiscal year 2012 budget request reflects that the 
Housing program expects to spend over $29.9 million on Other Services 
during fiscal year 2011, which is $790,000 more than VA originally 
planned to spend on Other Services during fiscal year 2011. For fiscal 
year 2012, VA is requesting $32.8 million for Other Services. That 
increase is explained as follows: ``Other services increases $6.7 
million as a result of increases to the Appraisal Management Service/
Automated Valuation Model contract, Housing's portion of contracts 
supporting the Veterans Relationship Management initiative, and must-
fund contracts to internal and external customers.''
    A. What factors account for the increase in Other Services during 
fiscal year 2011?
    Response. Payroll savings from elimination of the 2011 pay raise 
were realigned to Other Services to fund a job task analysis for loan 
production specialists. This supports VBA's strategic plan objective of 
defining competencies and providing national training products for 
nationally standardized positions.
    B. Please provide a detailed itemized list of how these funds would 
be spent during fiscal year 2012. To the extent that these funds will 
be spent on contracts, please explain the nature of the contract and 
the expected outcomes.
    Response:

             2012 Housing Other Services Increase over 2010
------------------------------------------------------------------------

------------------------------------------------------------------------
Appraisal Management Service/Automated Valuation Model            $4.2M
 Contract..................................................
Housing's share of the Veterans Relationship Management            0.1M
 Initiative................................................
Must-fund contracts to internal and external customers             2.4M
 management support*.......................................
                                                            ------------
      Total Increase.......................................       $6.7M
------------------------------------------------------------------------
* VBA incurs obligations that are considered ``must-fund,'' such as
  contractual obligations to the Department of Homeland Security for
  guard services, the Department of the Treasury for mailing benefits
  payments, the National Archives and Records Administration for records
  storage, and several VA customers (Debt Management Center, Financial
  Services Center, etc.). This figure represents those obligations and
  other management support obligations, such as VBA infrastructure
  obligations for the collocation or relocation of facilities and
  equipment operating, maintenance, and repair service contracts, which
  are apportioned to the Housing program.

                               insurance
    Question 1. The fiscal year 2012 budget request reflects that the 
Insurance Service is requesting $1.1 million for Other Services. Please 
provide a detailed itemized list of how these funds would be spent 
during fiscal year 2012. To the extent that these funds will be spent 
on contracts, please explain the nature of the contract and the 
expected outcomes.
    Response. The Insurance Service is requesting $1.1 million in Other 
Services in the fiscal year 2012 budget for the continuation of ongoing 
operations and to support the training needs of Insurance employees and 
stakeholders to assist in serving Veterans and Servicemembers more 
effectively.
    Of this $1.1 million, $750 thousand is budgeted for shared overhead 
expenses for the Regional Office and Insurance Center, which includes 
building maintenance, guard services, maintenance and repairs of 
equipment/furniture, shredding contract, and the building security 
access system. $344 thousand is budgeted for ongoing training of our 
human capital, which includes tuition reimbursement, the maintenance of 
our internal electronic reference guide for system practices and 
procedures, the development of web-based training modules, and outside 
training courses.
                        compensation and pension
    Question 1. VA's FY 2010 Performance and Accountability Report 
reflects that VBA plans to ``contract with vendors to collect medical 
records from private physicians/offices instead of direct requests to 
physicians by VA.'' Similarly, Secretary Shinseki's testimony for the 
March 2, 2011, hearing before the Senate Committee on Veterans' Affairs 
reflects that VA intends to use ``a private contractor to retrieve the 
records from the provider, scan them into a digital format, and send 
them to VA through a secure transmission.''
    A. Has VA entered into any contracts for this purpose? If not, what 
is the expected timeline for entering into these contracts?
    Response. The Department of Veterans Affairs (VA) entered into a 
contract with DOMA Technologies, LLC, in September 2010.
    B. Through these contracts, how many contractors are expected to 
perform claims processing functions (i.e., evidence gathering)?
    Response. VA has entered into one contract for services provided to 
seven Regional Offices. Upon expiration of the current contract, VA may 
seek to enter into another contract with terms that would provide 
services for additional Regional Offices.
    C. Where will these contractors be located?
    Response. DOMA Technologies, LLC is headquartered in Virginia 
Beach, VA.
    D. When are contractors expected to be on board and how long is VA 
expecting to use contractors to gather evidence?
    Response. Performance of work pursuant to the contract began in 
December 2010. The contract is scheduled to expire six months after 
work began, in June 2011. VA's evaluation of the performance is 
ongoing, and based upon the results, VA will determine whether a new 
contract is necessary at the end of the current contract.
    E. How much in total does VA expect to spend on these contractors?
    Response. VA has budgeted $384 thousand for this contract.
    F. Will VA use fiscal year 2011 funds to pay for these contractors? 
If so, how much?
    Response. If VA determines that the benefits of the contractor's 
services outweigh the costs, VA will use FY 2011 funds to cover the 
cost of a new contract. VA estimates that the cost of a nationwide 
contract will be $3 million for 2011.
    G. How much is requested for this initiative for fiscal year 2012?
    Response. VA has requested $16.4 million for this initiative in FY 
2012.
    H. What performance measures will be used to gauge the 
effectiveness of the contractors?
    Response. In order to gauge the effectiveness of the current 
contract, VA is evaluating the timeliness of the seven regional offices 
using the contractor's services as compared to the timeliness of 
regional offices requesting medical records directly from private 
physicians.
    I. What impact, in terms of increased productivity, does VA expect 
from using these contractors?
    Response. VA expects this contract to improve the timeliness of 
claims decisions by reducing the time in the claims processing cycle 
that VA is awaiting receipt of medical evidence needed to determine 
eligibility for benefits. The current contract supporting seven 
regional offices will help VA assess the improvements in the timeliness 
of service delivery, as well as whether there is any potential for 
increased productivity through this contract.

    Question 2. According to the fiscal year 2012 budget request, VA's 
goal is to ``eliminate the disability claims backlog by 2015 such that 
no veteran has to wait more than * * * 125 days for a high quality 
decision.'' However, for fiscal year 2011 and 2012, VA expects to 
receive more claims than it decides and, by the end of fiscal year 
2012, the inventory of claims is expected to be over 934,000, which is 
more than double the year-end inventory two years ago. Also, VA expects 
it to take on average 230 days to complete a claim in fiscal year 2012, 
which is 65 days longer than it took in fiscal year 2010.
    A. Please provide specific details about VA's plan to bring the 
backlog under control by 2015, such as what level of increase in 
productivity VA expects once the Veterans Benefits Management System is 
rolled out, how many claims VA expects to receive in each of the next 
four years, and how many claims VA would need to decide in each of the 
next four years.
    Response. VA's multi-tiered approach for balancing the attack on 
workflow includes a number of innovations. Improved access for Veterans 
will come with advances in increased internet capabilities such as: 
online access both for claim status and self-service options such as 
ordering copies of discharge records; this will improve customer 
satisfaction for Veterans of all time periods while freeing VA staff to 
work on claims. A 21st Century electronic processing solution will 
virtually put an end to lost paperwork and infuse new efficiencies 
through the Veterans Benefits Management System (VBMS). New evidence-
gathering tools such as Disability Benefits Questionnaires, three of 
which are currently in use for Ischemic Heart Diseases, Hairy cell 
Leukemia, and Parkinson's Disease, will sharpen the focus in medical 
examinations to ensure all information needed to rate the claim is 
gathered the first time in the medical examination process and is 
presented during the development phase of adjudication. The Fully 
Developed Claims program puts Veterans in the driver's seat for 
developing a claim that will be ready to rate when submitted, along 
with features that preserve the earliest possible effective date for 
back payments upon approval.
    In late 2012, VA estimates that production will begin to outpace 
receipts, the VBMS automated claims processing system simultaneously 
will be in a deployment phase, having completed a series of pilots 
currently under way. It will provide powerful new tools to claims 
examiners to boost efficiency and productivity. In addition to gains in 
accuracy which may reduce re-reviews and appeals, the rules-based 
processing and calculator tools also have a side benefit of speed in 
the rating process which will pay dividends in employee productivity 
and provide more staff hours to rate other claims.
    Beyond the estimates submitted in the 2012 President's Budget, VA 
estimates receipts to be 1.39M, 1.46M, and 1.53M 2013 through 2015. 
Likewise, VA estimates production to be 1.40M, 1.61M and 1.85M in 2013-
2015. Working under the assumption that the 2012 request for 14,320 C&P 
direct labor FTE remains constant, productivity due to the impact of 
the overall transformation plan (of which VBMS plays a part) will rise 
from 89 annual claims per C&P direct labor FTE in 2012 to 129 in 2015.
    B. Please explain whether the fiscal year 2012 budget request would 
provide VA with the tools and resources needed to follow through with 
that plan.
    Response. VBA's 2012 General Operating Expense budget request 
includes 14,320 direct FTE for compensation and pension claims 
processing as well as $72.7 million and 66 FTE for program management 
and oversight of transformation initiatives, to include the Veterans 
Benefits Management System and Veterans Relationship Management 
initiatives. We believe these are the resources necessary to continue 
to deploy important initiatives associated with the transformation plan 
in 2012.

    Question 3. In discussing changes from the original fiscal year 
2011 budget request, the fiscal year 2012 budget request for 
Compensation, Pensions, and Burial reflects that ``[o]bligations 
increase $11.8 million for Other Services above the funding reallocated 
from FTE from the original budget estimate.'' The fiscal year 2012 
budget request also reflects that VA is requesting $337 million for 
Other Services for fiscal year 2012.
    A. During fiscal year 2011, how much was reallocated to Other 
Services from FTE and for what purpose?
    Response. In FY 2011, VBA will realign approximately $57 million 
from personal services for exploration of alternatives to FTE to assist 
in breaking the back of the backlog.
    B. What factors account for the $11.8 million increase in Other 
Services during fiscal year 2011?
    Response. The $11.8M increase is a result of the realignment of 
personal services funding to be used for exploration of alternatives to 
FTE to assist in breaking the back of the backlog.
    C. Please provide a detailed itemized list of how these funds would 
be spent during fiscal year 2012. To the extent that these funds will 
be spent on contracts, please explain the nature of the contract and 
the expected outcomes.


  Compensation & Pensions (C&P) Service 2012 President's Budget--Other
                        Services Funding Request



Medical Examinations.......................................     $226.7M
Veterans Benefits Management System........................       31.5M
Claims Transformation Plan.................................       27.8M
Instructional Systems Development and Training--includes          18.2M
 Challenge training, leadership, and employee development
 programs..................................................
Pilots and Studies--includes work earnings loss study,             4.0M
 pilot for sending checklists to Veterans for information
 needed from them to process their claims, Institute for
 Defense Analyses (IDA) contract to assess and implement
 changes to enhance the accuracy of the quality assurance
 program...................................................
C&P Operations and Support*................................       28.5M
                                                            ------------
    Total Other Services Funding Request...................     $336.7M
                                                            ============

* This includes C&P Service's routine operational expenses, such as
  contracts for shredding, equipment maintenance, and travel
  requirements. It also includes C&P Service's portion of ``must-fund''
  obligations, such as contractual obligations to the Department of
  Homeland Security for guard services, the Department of the Treasury
  for mailing benefits payments, the National Archives and Records
  Administration for records storage, and several VA customers (Debt
  Management Center, Financial Services Center, etc.). The remaining
  funds consist of C&P Service's portion of the Veterans Relationship
  Management initiative; VBA infrastructure investments, such as the co-
  location or relocation of facilities and associated equipment contract
  costs; and equipment operating, maintenance, and repair services
  contracts.


    Question 4. In connection with the Committee's February 2010 
hearing on VA's fiscal year 2011 budget request, VA reported that 
``[i]n fiscal year 2010 the estimated output per Compensation and 
Pension direct labor FTE is 78 processed claims'' and ``[i]n fiscal 
year 2011 the estimated output per Compensation and Pension direct 
labor FTE is 79 processed claims.''
    A. For fiscal year 2012, what is the projected output per 
Compensation and Pension direct labor FTE (including in that FTE total 
any contractors that will perform claims processing functions, such as 
evidence gathering)?
    Response. VA estimates 14,320 Compensation and Pension direct labor 
FTE will produce 1,274,000 disability compensation and pension claims 
for an output of 89 claims per direct labor FTE in fiscal year 2012. 
This estimate does not include any additional contractors that may 
perform claims processing functions, such as evidence gathering, due to 
the fact that the only services VA contracts for currently is a pilot 
to retrieve medical evidence from private physicians. The goal of this 
contract is not to supplement direct labor FTE, but to expedite the 
retrieval of evidence.
    B. As part of the plan to break the back of the backlog, will VA 
focus on increasing the average number of claims processed per 
employee? If so, please explain.
    Response. Yes, VA's multi-tiered approach for eliminating the 
backlog includes a number of innovations. Improving online access for 
Veterans to obtain claim status information and perform self-service 
options, such as ordering copies of discharge records, improves 
customer satisfaction while freeing VA staff to work on claims. A 21st 
Century electronic processing solution will virtually put an end to 
lost paperwork and infuse new efficiencies through the Veterans 
Benefits Management System (VBMS). New evidence-gathering tools such as 
Disability Benefits Questionnaires, now rolling out, sharpen the focus 
in medical examinations to ensure all information needed to rate the 
claim is gathered in the medical examination and presented succinctly. 
The Fully Developed Claims program puts Veterans in the driver's seat 
for submitting a claim that will be ready to rate when received by VA.
    At the projected late-2012 peak of the bridge span when decisions 
production begins to outpace claims receipts, we will begin national 
deployment of the VBMS automated claims processing system. VBMS will 
provide powerful new tools to claims examiners to boost efficiency and 
productivity. In addition to gains in accuracy and reductions in rework 
and appeals, the rules-based processing and calculator tools will also 
speed the rating process and increase productivity.

    Question 5. In connection with the Committee's February 2010 
hearing on VA's fiscal year 2011 budget request, VA was asked to 
explain what would be a reasonable goal for rating-related claims 
processed per employee and VA provided this response: VA is currently 
undergoing a metric study associated with rating-related claims 
processed based upon employee experience levels. One key factor being 
analyzed is the average number of issues addressed for rating-related 
claims. We expect this study to provide us with baseline information 
that will enable us to establish appropriate measures and goals for 
claims processing employees.
    A. What is the status of that initiative and how much in total has 
VA expended on this initiative?
    Response. In 2009, the Institute for Defense Analyses (IDA) was 
contracted to conduct a study and provide an assessment of the current 
personnel requirements of the VBA. This study involved an analysis of 
rating-related claims processed based on employee experience levels and 
an assessment of the adequacy of the number of personnel assigned to 
each regional office for each type of claim adjudication position. VA 
paid $600,015 for this contract, which was mandated by section 
104(b)(2) of Public Law 110-389, the Veterans Benefits Improvement Act 
of 2008. Results are being considered in the current revision of claims 
processors' performance standards, as discussed in response to question 
5C below.
    B. For fiscal year 2012, how much, if any, funding is requested for 
purposes of this initiative?
     Response: No funding is requested in FY 2012 for this initiative.
    C. For fiscal year 2012, will goals for claims processing employees 
be established based on this study? If so, please provide a list of the 
goals for claims processing employees with various levels of 
experience.
    Response. Goals for claims processors have not been revised based 
on this study. However, VBA is currently reviewing and revising the 
current performance standards for each category of claims processors, 
including Veterans Service Representative, Rating Veterans Service 
Representative, and Decision Review Officer. VBA is engaged with our 
Union partners to develop revised standards that allow VBA to achieve 
our overall strategic goals while meeting the needs of our stakeholders 
and employees. We anticipate these standards to be implemented in early 
FY 2012.

    Question 6. Since 2006, the level of claims processing staff has 
increased by more than 80%. In connection with the Committee's 
February 2010 hearing on VA's fiscal year 2011 budget request, VA was 
asked what metrics would be used to determine whether these hiring 
initiatives have been effective. VA responded that, ``[w]hile VBA uses 
a combination of workload management indicators to gauge performance, 
we will closely monitor rating quality, inventory, and completed claims 
to determine the effectiveness of our recent hiring initiatives.''
    A. For fiscal year 2010, please explain whether those indicators 
(rating quality, inventory, completed claims) reflect that the large 
staffing increases have been effective.
    Response. VA's recent staffing increases have been effective in 
decreasing the overall impact of external factors on performance. We 
increased our workforce in 2010 by converting 2,400 American Recovery 
and Reinvestment Act employees to full-time and by hiring an additional 
600 new employees; these employees are assisting VA in taking on the 
challenge of a dramatically increasing workload.
    VA's pending claims inventory is rising due to the unprecedented 
volume of disability claims being filed. In 2010, we received 
approximately 1.2 million disability claims, a 17.6% increase over the 
previous year. While the volume and complexity of claims have 
increased, so too has the overall production effort of our claims 
processing workforce. In 2010, VBA processed an historic 1.08 million 
claims, an increase of 10.2% over 2009.
    VA continues to aggressively train claims processing staff across 
the Nation. Recognizing that it takes approximately two years for a new 
hire to become fully trained in claims processing, new employees are 
mentored and provided timely feedback from trainers, reviewers, and 
supervisors. Area offices are also providing increased oversight and 
support for those ROs whose national rating-related claims quality is 
below 85%.
    VA currently employs over 11,000 full-time claims processors. 
Hiring more employees is not a sufficient solution. The need to better 
serve our Veterans requires bold and comprehensive business process 
changes to transform VBA, and therefore VA, into a high-performing 21st 
century organization that provides the best services available to our 
Nation's Veterans, survivors, and their families; The Claims 
Transformation Initiative is VA's effort to achieve these goals and 
break the back of the backlog by 2015.
    B. Please explain whether any measures of individual employee 
productivity currently are used to gauge the effectiveness of hiring 
initiatives and, if not, whether any such measures will be used during 
fiscal year 2012.
    Response. VA is actively revamping individual employee performance 
standards to ensure that individual goals tie directly to national 
initiatives to reduce the backlog and process claims with a 98% 
accuracy rate. In April 2010, VA implemented the revised performance 
plan for Veterans Service Representatives (VSRs) nationwide. This plan 
no longer allows work credit for interim claims actions; VSRs now 
receive credit only for performing a series of actions that will 
advance the claim to the next stage of the claims life cycle. The 
quality element has been increased to align the individual goal with 
the national quality goal, and local quality reviews are now based on 
the same review checklist as the national quality reviews. The revised 
performance plan is also designed to align local station performance 
targets to employee performance in both the quality and quantity of 
individual workload output. Similar reviews and revisions are currently 
underway for the Rating Veterans Service Representative and Decision 
Review Officer performance plans.

    Question 7. VA's FY 2010 Performance and Accountability Report 
reflects that VA has developed ``an overtime tracker to allow for 
nationwide reporting of claims processing during overtime hours at the 
local and national level.''
    A. For fiscal year 2010, how many overtime hours were worked for 
purposes of claims processing, how much in total was expended to pay 
for those overtime hours, and how many claims were completed as a 
result of those overtime hours?
    Response. In FY 2010, VBA expended $32 million for claims 
processing overtime. This is not broken down nationally by total 
overtime hours worked. Regional offices are allotted overtime funds 
based on local workload and support of national programs. VBA completed 
almost 250,000 actions related to rating claims in FY 2010 on overtime. 
This included development actions and preparation and promulgation of 
rating decisions. Because all actions associated with processing 
individual claims are rarely all completed during overtime hours, a 
measure of ``claims completed during overtime hours'' is not easily 
defined. All claim's steps processed on overtime are necessary and lead 
to the eventual completion of the rating claim.
    B. For fiscal year 2011, how many overtime hours are expected to be 
worked for purposes of claims processing, how much in total is expected 
to be expended to pay for those overtime hours, and how many claims are 
expected to be completed as a result of those overtime hours?
    Response. Because we are operating under a continuing resolution, 
our overtime spend level for FY 2011 is currently the same as FY 2010, 
$32 million for claims processing. We recently directed that overtime 
funds be specifically focused on completion of rating actions and 
promulgation of rating decisions, which will increase the number of 
rating claims completed on overtime. We continue to explore ways to 
integrate data across systems to better quantify work completed during 
overtime hours.
    C. For fiscal year 2012, what level of funding is requested to pay 
for overtime hours for claims processing? How many claims are projected 
to be completed as a result of those overtime hours?
    Response. In FY 2012, the VBA budget request includes the same 
level of funding for claims processing overtime, $32 million. For the 
reasons articulated in the previous responses, VBA does not have 
specific projections of overtime production. However, transformational 
initiatives such as Smart VA-Calculators and Disability Benefits 
Questionnaires (DBQs) will increase both efficiency and production of 
completed rating decisions. VBA expects to realize a resulting increase 
in production of rating claims completed on overtime.

    Question 8. In connection with the Committee's February 2010 
hearing on VA's fiscal year 2011 budget request, VA reported that the 
overall attrition rate for VBA claims processing staff was 
approximately 10% per year from fiscal year 2005 to fiscal year 2009. 
VA also reported that ``Regional offices that have difficulties in 
meeting performance targets are predominantly in high-cost metropolitan 
areas with high employee turnover.''
    A. What was the overall attrition rate for compensation and pension 
claims processing staff in during fiscal year 2010?
    Response. The attrition rate for VBA claims processors (permanent 
employees in GS-0996/0930 series positions) during FY 2010 was 6.05 
percent.
    B. Please identify the five VA regional offices that experienced 
the highest attrition rates during fiscal year 2010 and the rates of 
attrition at those offices.
    Response. In FY 2010, the following regional offices had the 
highest attrition rates for claims processing personnel (permanent 
employees in GS-0996/0930 series positions):

    Anchorage, AK: 25%
    White River Junction, VT: 17%
    Manchester, NH: 14%
    Little Rock, AR: 12%
    Albuquerque, NM: 12%

    C. For those offices, please identify the key performance outcomes 
for fiscal year 2010, including timeliness and quality measures.
    Response. Key performance measures for fiscal year 10 were Average 
Days Pending (ADP), Average Days to Complete (ADC), and Rating Quality.


------------------------------------------------------------------------
                                                               Rating
                                     ADP           ADC         Quality
------------------------------------------------------------------------
National Average..............        116.9         165.5         83.8%
Anchorage.....................        110.1         186.1         87.6%
White River Junction..........        156.2         208.0         82.4%
Manchester....................        116.3         168.6         84.4%
Little Rock...................         98.7         162.9         82.7%
Albuquerque...................        117.1         161.5         85.4%
------------------------------------------------------------------------

    D. During fiscal years 2011 and 2012, what level of staffing and 
funding will be provided to those offices and what measures will VA 
take to ensure that Veterans in those areas will receive timely, 
accurate decisions?
    Response. The staffing levels for FY 2011 are as follows: 41 FTE in 
Anchorage, 25 FTE in White River Junction, 64 FTE in Manchester, 198 
FTE in Little Rock, and 98 FTE in Albuquerque. Funding for FY 2011 has 
been provided to support these staffing levels. The regional office 
(RO) staffing and funding levels for FY 2012 will be determined after 
receipt of the FY 2012 appropriation and will be based on the latest 
workload and performance information available at that time.
    For the past several years, VBA has used a brokering strategy to 
assist ROs experiencing high turnover and to balance the inventory of 
pending claims across ROs. Pending claims are sent from ROs with high 
inventories to offices with capacity to process additional workload. 
This strategy is being used in all five of these ROs in fiscal year 
2011.
    VBA monitors performance and develops specific action plans to 
improve performance. Oversight is provided through site visits 
conducted by both the Compensation Service and the Area Directors. RO 
directors are held accountable for performance though annual 
performance evaluations.

    Question 9. Under current law, a VA claimant and an attorney or 
agent who is representing him/her before VA may enter into an agreement 
providing that, if past-due benefits are awarded to the claimant by VA, 
the attorney or agent's fee will consist of a percentage of those past-
due benefits and the attorney or agent will be paid directly by VA from 
those past-due benefits. In January 2011, VA announced that it is 
developing new procedures to govern cases where ``VA mistakenly fails 
to make a direct payment of fees to an accredited attorney or agent out 
of VA funds.'' VA provided this explanation: Current VA procedures note 
that, if VA fails to withhold a portion of past due benefits for direct 
payment of fees and the attorney or agent is eligible for fees, VA will 
pay the representative from VA funds. This procedure will remain the 
same. However, new procedures will provide that VA may recoup the 
amount of the fees by establishing an overpayment against the past due 
benefits paid to the claimant.
    A. To clarify, before these new procedures are implemented, if VA 
pays both the attorney or agent and the claimant for the amount that 
should have been paid directly to the attorney or agent, does VA try to 
recoup the duplicate payment?
    Response. No. Under the current procedures, if VA pays both the 
attorney or agent and the claimant the amount that should have been 
paid directly (and solely) to the attorney or agent, VA does not recoup 
the amount of the overpayment. The new procedures will provide that VA 
may recoup the amount of the fees from the claimant.
    B. In fiscal year 2010, in how many cases did VA fail to make 
direct payment of fees to an eligible attorney or agent and how much in 
total was paid to attorneys or agents ``from VA funds'' as a result?
    Response. The number of times VA fails to make direct payment of 
fees and the total amount paid to attorneys and agents from VA funds is 
not available, as this information is not electronically tracked.
    C. To date, in fiscal year 2011, in how many cases did VA fail to 
make direct payment of fees to an eligible attorney or agent and how 
much in total has been paid to attorneys or agents ``from VA funds'' as 
a result?
    Response. See the response to 9B.
    D. What is the expected timeframe for developing the new 
procedures?
    Response. The Fast Letter outlining the new procedures is in the 
final concurrence stages of VBA. Once approved, the field will 
immediately implement the new procedures.

    Question 10. During 2010, VA was pursuing at least 40 pilots and 
initiatives in order to try to address the backlog of disability 
claims. As discussed at a July 2010 hearing, over 12 years ago, former 
Under Secretary for Benefits Joe Thompson said this about VA's efforts 
to improve claims processing:

        [The Veterans Benefits Administration] has undertaken a number 
        of initiatives to bring about needed change * * *. The reasons 
        for the lack of success * * * [include] inadequate planning, 
        unclear goals and objectives, poor integration of interrelated 
        efforts, a lack of coordination with other stakeholders, and 
        insufficient implementation planning and follow-up.

    A. Please provide a list of any current initiatives/pilots.
    Response. See the attached document entitled ``VA Claims 
Transformation--Claims Transformation Initiatives.'' 

[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

    B. When will determinations be made as to whether to continue, 
expand, or disband these initiatives/pilots?
    Response. We are accelerating to the extent possible the evaluation 
timelines, while also ensuring sufficient data are available to 
accurately assess the initiatives' operational impact and success. For 
many initiatives, we use a 90-day cycle. However, given the length and 
complexity of the claims processing cycles, some initiatives must run 
longer. For example, the Indianapolis Integration Pilot will run longer 
to accommodate adjustments and tests. Some of the longer-term 
initiatives will run for a year or more: Disability Benefits 
Questionnaires, Integrated Communication Plan, and Disability 
Evaluation Narrative Text Tool.
    C. What efforts are being made to integrate the various 
initiatives/pilots?
    Response. We have selected the Indianapolis Regional Office as the 
site of the Veteran Benefits Administration's Integration Lab (I-Lab). 
The purpose of I-Lab is to test multiple initiatives within a new end-
to-end processing model. Our change initiatives are currently tested in 
separate regional offices. The I-Lab provides a place to test them 
concurrently, where we can define and document dependencies.
    The I-Lab is currently testing the following initiatives: Intake 
Processing Center, Comprehensive Screening, Case Management, Lean 
Claims Processing, Express Lane, and Private Medical Records.
    D. What level of funding is requested during fiscal year 2012 to 
support the on-going initiatives/pilots?
    Response. VBA's 2012 General Operating Expense budget request 
includes $72.7 million and 66 FTE for program management and oversight 
of transformation initiatives, to include the Veterans Benefits 
Management System and Veterans Relationship Management initiatives.

    Question 11. During 2010, VA expanded nationwide its fully 
developed claim initiative, through which VA expedites claims that 
arrive with necessary evidence.
    A. How many fully developed claims have been filed since this 
program was expanded and on average how long is it taking to provide a 
decision on fully-developed claims?
    Response. Between June 2010 (pilot start date) and March 9, 2011, 
the FDC program produced 5,193 completed claims. The average length of 
time to complete the FDC claims is 84.7 days.
    B. Please describe any outreach that has been conducted to alert 
veterans, their families, and their representatives about the fully 
developed claim process.
    Response. VA has attracted national publicity by issuing a news 
release about the FDC program, and has efforts in progress to develop 
additional media products to seek more national attention. A Web site 
was launched at http://benefits.va.gov/fastclaims offering information 
and links to a detailed fact sheet and the forms for the program. The 
site has received more than 13,000 visits. The FDC program has been 
briefed to the major Veterans Service Organizations (VSOs), and VA 
recently had an intensive all-day meeting on FDC with a group of VSO 
representatives from around the country to discuss opportunities to 
expand Veterans' understanding and use of the program. VA has taken FDC 
flyers to events for distribution to Veterans, such as VSO conventions, 
a NASCAR exhibition, and game four of the World Series last fall.
    C. What outreach activities will be undertaken with respect to this 
initiative in fiscal year 2012 and how much funding is requested for 
that purpose?
    Response. VA continues to seek the best approaches to provide 
outreach on this program and is currently developing a pilot in the Los 
Angeles and Waco regional offices' catchments to gauge whether 
submission of FDC claims increases through a coordinated series of 
marketing efforts. In FY 2011, this is expected to involve online 
advertising, promotional events, and distribution of materials to local 
VSOs, as well as handouts, posters and banners for use at VA outreach 
events, VA medical centers, and other locations. Results from this 
pilot will guide VA outreach efforts for the FDC program in FY 2012. 
Funding for this initiative is not specifically identified as a line 
item in the FY 2012 budget request, but such resources would be 
included in the overall funds allocated for our transformational 
programs.

    Question 12. For many years, experts have stressed the need to 
update the VA disability rating schedule. In connection with the 
Committee's February 2010 hearing on VA's fiscal year 2011 budget 
request, VA indicated that ``VBA plans to dedicate $2.2 million 
(includes FTE) in FY 2011 to update the rating schedule'' and that VA 
anticipated spending $750,000 in fiscal year 2010 and $750,000 in 
fiscal year 2011 on a contract for that purpose. Also, VA's Project 
Management Plan for revision of the rating schedule reflects that 
``econometric earnings loss data will be obtained through future 
contracts with econometric companies if funding can be procured.''
    A. How much was expended during fiscal year 2010 on a contract or 
contracts related to the review of the rating schedule and how much is 
expected to be spent during fiscal year 2011 for that purpose?
    Response. In fiscal year 2010, VBA expended $196,000 for a contract 
physician to review and revise the current rating schedule. In the 2011 
budget, VBA requested $750,000 for the work earnings loss study and has 
expended nearly $525,000.
    B. What level of funding would be required during fiscal year 2012 
to obtain ``econometric earnings loss data * * * through future 
contracts with econometric companies?'' Is funding for that specific 
purpose included in the fiscal year 2012 budget request? If so, how 
much is requested for that purpose?
    Response. VBA requested $1 million in the 2012 budget for a work 
earnings loss study.
    C. What is the current level of staffing dedicated to updating the 
rating schedule? What level of staffing will be dedicated to this 
effort during fiscal year 2012?
    Response. Seven FTE and one contractor are currently dedicated to 
updating the rating schedule, and that level of effort is estimated to 
continue into 2012.
    D. How much in total was expended during fiscal year 2010 to update 
the rating schedule? Please provide an itemized list of how that 
funding was expended.
    Response. In 2010, VBA obligated $604,000 to update the rating 
schedule.

      2010 Funding Dedicated to Updating the Rating Schedule $000s
------------------------------------------------------------------------

------------------------------------------------------------------------
Payroll and travel.........................................      $327
Contract physician.........................................       196
Musculoskeletal, mental health, endocrine & hemic/lymphatic        81
 forums....................................................
                                                            ------------
      Total Obligations....................................      $604
------------------------------------------------------------------------

    E. During fiscal year 2011, how much in total does VA currently 
plan to expend to revise the rating schedule? Please provide an 
itemized list of how that funding is expected to be expended.
    Response. VBA plans to spend $750,000 for a work earnings loss 
study, $387,000 for a medical consultation contract, and payroll 
resources of approximately $1.1 million for seven FTE.
    F. How much funding in total from the fiscal year 2012 budget is 
requested for purposes of updating the disability rating schedule? Will 
that funding be specifically designated for the purpose of updating the 
rating schedule and under the control of the project manager who is 
leading that effort?
    Response. In the 2012 budget request, VBA requested $1 million for 
a work earnings loss study, $391 thousand for a medical consultation 
contract, and payroll resources of approximately $1.1 million for seven 
FTE. This funding is designated for the rating schedule update and will 
be monitored by the project manager.
    G. Does the fiscal year 2012 funding request include funding to 
reimburse experts for travel expenses or funding to plan and carry out 
any additional public forums? If so, what level of funding would be 
provided for those purposes?
    Response. The budget request does include funding to reimburse 
subject matter experts for travel expenses and for contractors to plan 
and execute public forums in the amount of $120,000.
    H. Does the fiscal year 2012 budget request contain sufficient 
funding for all employees, contracts, and other expenses necessary to 
update the rating schedule in accordance with the Project Management 
Plan?
    Response. In the FY 2012 budget request, funding is sufficient to 
carry out the approved Project Management Plan, which includes two 
studies as well as other work necessary to update the rating schedule.

    Question 13. At a Senate Committee on Veterans' Affairs hearing in 
September 2009, the Committee discussed a report prepared by Economic 
Systems, Inc., entitled ``A Study of Compensation Payments for Service-
Connected Disabilities,'' which in part included options for 
compensating veterans for loss of quality of life caused by their 
service-related injuries. The Under Secretary for Benefits at that time 
indicated that further study would be necessary before moving forward 
with most of the options in that report. After that, VA provided this 
information:

    The Advisory Committee on Disability Compensation is currently 
reviewing and analyzing potential models for compensating for Quality 
of Life (QOL) loss * * *. Due to the on-going work of the Advisory 
Committee on Disability Compensation, VA does not believe that 
additional studies to create a separate system to compensate for 
[quality of life] loss should be considered at this time.
    A. Has the Advisory Committee provided VA with any actionable 
recommendations regarding quality of life? If so, what actions does VA 
plan in response to those recommendations?
    Response. The Advisory Committee on Disability Compensation 
provided VA with 12 recommendations. Two covered quality of life and 
non-economic (other than work) income loss. However, the term ``quality 
of life'' is absent from any and all VA regulations and statutes 
authorizing compensation, as is the term ``non-economic'' loss. VA's 
compensation statute at title 38 U.S.C. 1155 only authorizes disability 
compensation to Veterans for reductions in earning capacity due to 
disability resulting from injury or disease incurred in or aggravated 
by active military service. A new compensation scheme based on quality 
of life or some other system would require legislation.
    B. Does VA plan to conduct any studies--separate from the Advisory 
Committee--on quality of life? If so, what level of funding is needed 
for that purpose during fiscal year 2011 and 2012?
    Response. Completely separate from the Committee, the Compensation 
and Pension Service is contracting for an earnings loss study of the 
musculoskeletal section of the rating schedule. The purpose of this 
study is to evaluate the average earnings losses incurred by veterans 
due to service-connected musculoskeletal diseases or injuries as 
described within diagnostic codes within the schedule. Again, VA 
compensation statutes do not provide for compensation based on 
``quality of life'' issues, but only average losses in earning 
capacities. Therefore, while this study will analyze compensation forms 
of earnings loss capacity outside the VA system (i.e. workers' 
compensation and social security disability compensation), it will not 
address quality of life, because such a study would exceed VA's 
compensation authority.
    C. How much in total has VA expended with regard to the Advisory 
Committee on Disability Compensation and what level of funding is 
requested for fiscal year 2012?
    Response. Approximately $260,000 was spent in 2010. We plan for the 
Advisory Committee members to actively participate in the scheduled 
forums for updating the VASRD. The 2011 and 2012 budget requests 
include $300,000 in each year for the Advisory Committee.
    D. To date, what actions have been taken by VA in response to the 
Committee's recommendations?
    Response. VA has acted upon most recommendations that fall within 
VA's statutory authority. In response to the Committee's 
recommendations, VA hired five additional personnel on the Compensation 
and Pension Service's Policy Staff. These new hires include an 
experienced disability rating specialist with hands-on expertise as 
well as four new medical doctors to lead the effort to update the VASRD 
so that it incorporates econometric earnings loss data and current 
medial science. As recommended by the Committee in connection with 
updating the VASRD, VBA is receiving direct support from VHA medical 
subject matter experts (SMEs), who made formal presentations at four 
public forums and continue to provide medical science information as 
part of working groups set up after the forums. Also as recommended, VA 
initiated an Earnings Loss Study with the George Washington University, 
via an inter-agency agreement with the Department of Health and Human 
Services, to empirically study lost earnings by Veterans who are 
service-connected with musculoskeletal disabilities. The current 
medical science information that is captured from VHA SMEs and the 
earnings loss findings form the basis for updating the VASRD.

    Question 14. Last year, VA announced that claims based on exposure 
to contaminated water at Camp Lejeune would be consolidated at the VA 
regional office in Louisville.
    A. How many employees at Louisville will handle Camp Lejeune claims 
during fiscal year 2011 and during fiscal year 2012?
    Response. As of March 2011, the Camp Lejeune contaminated water 
(CLCW) caseload of 638 claims represents nearly 10 percent of the 
rating workload of the Louisville Regional Office (RO). At this time, 
the Veterans Service Center has 15 full-time employees devoted to 
processing these cases. The RO intends to maintain at the current level 
in FYs 11 and 12, provided CLCW receipts remain stable. The VSC will 
continue to monitor CLCW workload and make appropriate adjustment, as 
necessary.
    B. Does the fiscal year 2012 budget request include sufficient 
funding to provide any necessary training for these employees, so they 
will be kept informed of new studies or information regarding the 
contaminates at Camp Lejeune? If so, please explain.
    Response. The budget request for fiscal year 2012 contains 
sufficient funding to keep the Louisville Regional Office personnel 
fully trained and informed on the processing of Camp Lejeune-related 
claims. On January 11, 2011, VA Fast Letter 11-03, Consolidation and 
Processing of Disability Claims Based on Exposure to Contaminated 
Drinking Water at Camp Lejeune, North Carolina, was released to VBA 
field stations, explaining certain technical aspects of processing 
these claims. A training letter has also been developed to provide 
background information and explain the relationship between certain 
diseases and the volatile organic compounds known to have contaminated 
the Camp Lejeune water supply. This will assist adjudicators making 
rating decisions as well as VA medical examiners who may not be 
familiar with the specific science related to these contaminants. The 
training letter will be released in the near future.
    Following release of the Fast Letter, Compensation and Pension 
Service provided in-person training to Louisville staff. C&P will 
continue to communicate with that office on a weekly basis. In-person 
training sessions will be provided as needed to ensure that all aspects 
of the claims process are understood. Additionally, VA will continue to 
monitor the studies currently underway by the Department of Health and 
Human Services' Agency for Toxic Substances and Disease Registry 
(ATSDR) related to Camp Lejeune. This agency is developing computer 
modeling to recreate flow patterns of the contaminated water system as 
well as a survey questionnaire to assess long-term health effects among 
individuals who served at Camp Lejeune during the 1957 to 1987 period 
of water contamination. When results of these studies are received, VA 
will incorporate the findings into training sessions for the Louisville 
Regional Office to ensure that claims processing is up to date. These 
studies are projected to be completed in 2013.
    VBA's budget request for 2012 provides sufficient funding to meet 
this training requirement.

    Question 15. Since 2003, certain cases remanded by the Board of 
Veterans' Appeals have been handled at a centralized entity called the 
Appeals Management Center.
    A. How much was spent on the Appeals Management Center during 
fiscal year 2010 and what level of staffing did that funding support?
    Response. During fiscal year 2010, $16.3 million was spent for the 
Appeals Management Center. $14.2 million comprised payroll and 
supported a staffing level of 168 full-time employees.
    B. How much is projected to be spent during fiscal year 2011 and 
what level of staffing will that funding support?
    Response. At this time, Appeals Management Center on-board staffing 
level is projected to increase to 209 FTE, with 2011 funding at $18 
million for both payroll and non-payroll expenditures.
    C. In total, how much funding is requested for fiscal year 2012, 
and what level of staffing will that funding support?
    Response. In 2012, the Appeals Management Center is expected to 
maintain the 2011 staffing level and the funding request estimate is 
$18.3 million, including payroll and non-payroll expenditures. The 
anticipated $1.8 million increase in funding over 2011 is attributable 
to scheduled payroll increases (career-ladder and within-grade 
increases) and inflation associated with shipping, supplies and other 
non-payroll, general operating expenses.
    D. How many appeals are currently pending at the Appeals Management 
Center?
    Response. There are 20,899 appeals pending at the Appeals 
Management Center as of March 15, 2011.
    E. How many of those pending cases are ready-to-rate; how many 
employees are dedicated to handling ready-to-rate cases; and what steps 
are being taken to provide decisions on those cases before the evidence 
becomes outdated?
    Response. 11,715 cases are ready-to-rate as of March 15, 2011. 27 
Decision Review Officers, 5 Rating Veterans Service Representatives 
(RVSRs), and 6 newly selected RVSR trainees are dedicated to handling 
ready-to-rate cases. Additional hiring is anticipated. Workload 
management tools have been implemented that focus on expediting the 
oldest pending remands. In January 2011, the Appeals Management Center 
began brokering approximately 500 ready-to-rate cases per month to a 
special processing team in Cleveland.
    F. What were the key performance outcomes for the Appeals 
Management Center in fiscal year 2010 (related to timeliness, accuracy, 
and inventory) and what are the expected performance outcomes for 
fiscal years 2011 and 2012?
    Response. Significant improvements were made in timeliness outcomes 
over FY 2009. ``Average days pending'' improved from 383 days in FY 
2009 to 233 days in FY 2010. ``Average days to complete'' improved from 
477 days in FY 2009 to 428 days in FY 2010. Accuracy was 74 percent for 
FY 2010. The pending remand inventory at the end of FY 2010 was 19,649, 
which was higher than the 18,500 target.
    Performance targets for fiscal year 2011 are 180 days for ``average 
days pending,'' and 380 days for ``average days to complete.'' The FY 
2011 accuracy target is 90 percent. Additionally, the accuracy review 
for the Appeals Management Center has been adjusted to use a larger, 
statistically valid sample. For FY 2011, the end-of-year inventory 
target remains 18,500 claims.
    The FY 2012 performance targets will be established near the end of 
FY 2011 based on the actual performance of the Appeals Management 
Center during FY 2011.

    Question 16. As one strategy to deal with VA's backlog of 
disability claims, VA brokers claims between VA regional offices.
    A. How many cases did VA broker during fiscal year 2010 and how 
many cases does VA expect to broker during fiscal year 2011 and during 
fiscal year 2012?
    Response. In FY 2010, a total of 105,337 rating-related cases were 
brokered. Through February 2011, a total of 12,547 rating-related cases 
were brokered. The total expected FY 2011 brokering will be 
approximately 30,000 cases. The sharp decline in brokering is a result 
of utilizing the thirteen resource centers to process Agent Orange 
claims that are subject to the provisions of the Nehmer litigation. It 
is expected that beginning in early FY 2012, the resource centers will 
return to adjudicating brokered rating workload. VBA has not projected 
the volume of brokered cases for 2012.
    B. Has VA developed performance measures or collected data that 
would allow a comparison of the timeliness and quality of decisions 
rendered in brokered cases versus cases that are not brokered? If so, 
please explain.
    Response. Comparative quality data is collected for both regional 
offices that send brokered workload and resource centers that complete 
brokered work. VBA is currently engaged in refining existing data 
systems and workload tracking mechanisms to compare timeliness between 
sites that broker work and sites that complete brokered work. It is 
expected that these enhancements will be in place in fiscal year 2012.
    C. Has VA developed performance measures or collected data that 
would allow VA to determine the cost-effectiveness of brokering? If so, 
please explain.
    Response. Measurements do not currently exist to determine the cost 
effectiveness of workload brokering. VBA is currently engaged in 
refining existing data systems and workload tracking mechanisms to 
allow appropriate data collection to support cost-effectiveness 
analyses.

    Question 17. According to VA's fiscal year 2012 budget request, 
VA's fiduciary program supervises over 110,000 incompetent 
beneficiaries.
    A. During fiscal year 2012, what level of funding would be used to 
support the fiduciary program and what level of staffing would that 
funding support?
    Response. In 2012, approximately $48 million will support 
approximately 600 fiduciary staff.
    B. What were the key performance outcomes for the fiduciary program 
during fiscal year (FY) 2010 and what are the expected performance 
outcomes for fiscal years 2011 and 2012?
    Response. The key performance indicators for the fiduciary program 
are:

    1. Quality--Quality of the fiduciary program increased from 81.5% 
in FY 2009 to 85.0% in FY 2010. The expected performance outcome for FY 
2011 is 86.5% and 90.0% in FY 2012.
    2. Timeliness of account audits--The timeliness of account audits 
increased from 92.1% in FY 2009 to 92.3% in FY 2010. The expected 
performance outcome for FY 2011 and FY 2012 is 93%.
    3. Timeliness of field examinations--The timeliness of field 
examinations completed in FY 2010 was 81.4%. The expected performance 
outcome for FY 2011 and FY 2012 is 92%.
    4. During FY 2011, VA initiated the performance outcome relating to 
the timeliness of accountings received--It is anticipated the 
performance outcome for FY 2011 and FY 2012 will be more than 95% of 
all accountings are received prior to becoming seriously delinquent.

    C. Does VA's fiscal year 2012 budget request include funding to 
develop an on-line training program for fiduciaries? If so, how much is 
included for that purpose?
    Response. The 2012 budget request does not include funds to develop 
an online training program for fiduciaries but we have conducted 
research to identify existing certification programs. We plan to 
develop a system in 2013.
    D. How many incompetent beneficiaries now live overseas and will 
the requested funding allow VA to appropriately protect the interests 
of those beneficiaries? If so, please explain.
    Response. The Fiduciary Program has 1,099 beneficiaries residing in 
40 foreign countries. The funding requested in the 2012 budget will 
allow VA to appropriately protect the interests of those beneficiaries. 
Approximately 80 percent of these beneficiaries reside in the Republic 
of the Philippines and their welfare is monitored by a local VA 
fiduciary activity. VA leverages the support of our embassies to 
provide oversight of the remaining beneficiaries through periodic 
visits.

    Question 18. The FY 2010 Performance and Accountability Report 
reflects that VA has recognized the need to replace the Fiduciary 
Beneficiary System and to that end a Request for Information was 
released during fiscal year 2010.
    A. What level of funding is expected to be expended during fiscal 
year 2011 to replace the Fiduciary Beneficiary System?
    Response. VA estimates it will spend $50 thousand in General 
Operating Expense funds in its effort to replace the Fiduciary 
Beneficiary System in 2011.
    B. What level of funding is requested for fiscal year 2012 for this 
purpose?
    Response. VA estimates it will spend $38 thousand in General 
Operating Expense funds in its effort to replace the Fiduciary 
Beneficiary System in 2012.
    C. What is the expected timeline for completion of the replacement 
of the Fiduciary Beneficiary System?
    Response. VA estimates the Fiduciary Beneficiary System will be 
replaced in 2013.

    Question 19. A November 2010 Fast Letter (10-51) set forth 
procedures for VA regional offices to follow in handling requests for 
relief from the requirement that VA report to the National Instant 
Criminal Background Check System the names of beneficiaries who have 
been assigned a fiduciary. In part, that Fast Letter provides this 
guidance: ``To grant relief, the record must show affirmatively, 
substantially, and specifically that the beneficiary is not likely to 
act in a manner dangerous to public safety, and that granting relief 
will not be contrary to the public interest.''
    A. How many of these requests for relief has VA received, how many 
have been decided, and how many remain pending?
    Response. As of March 9, 2011, VA has received 101 requests and 
decided 13. VA has 88 requests for relief pending.
    B. Of the requests for relief that have been decided, how many have 
been granted?
    Response. VA has granted one request for relief.
    C. What level of funding is requested for fiscal year 2012 to 
provide training for regional office employees on how to determine if a 
beneficiary is dangerous?
    Response. VA included criteria to consider in evaluating public 
safety in Fast Letter 10-15, dated November 22, 2010. Training will be 
incorporated in our annual training curricula. No additional funding in 
2012 is needed for this purpose.

    Question 20. DOD and VA plan to roll out to 140 sites worldwide a 
joint disability evaluation system, called the Integrated Disability 
Evaluation System or IDES, through which an injured or ill 
servicemember, before being medically discharged from the military, 
completes both the DOD disability rating system and the VA disability 
rating process. While DOD and VA were piloting this concept, 
significant challenges came to light, including untimely medical 
examinations, logistical issues, and staffing shortages.
    A. At the 27 original (pilot) IDES sites, are there currently 
sufficient VA personnel to meet all relevant staffing goals? If not, 
please identify the specific sites where staffing goals are not being 
met and a timeline for when those goals will be met.
    Response. All 27 sites have sufficient staffing levels.
    B. At the 28 additional sites that have certified readiness to 
begin the IDES process, are there currently sufficient VA personnel to 
meet all relevant staffing goals? If not, please identify the specific 
sites where staffing goals are not being met and a timeline for when 
those goals will be met.
    Response. The 28 sites have sufficient staffing levels.
    C. During fiscal year 2011, how much in total does VA expect to 
expend with respect to the IDES (including both mandatory and 
discretionary funds) and how many VA employees will be dedicated to the 
IDES process?
    Response. The 2011 budget request includes approximately $23 
million to support 285 FTE and $13 million for contract examinations.
    D. During fiscal year 2012, how much in total does VA expect to 
expend with respect to the IDES (including both mandatory and 
discretionary funds) and how many VA employees will be dedicated to the 
IDES process?
    Response. The 2012 budget request includes approximately $24 
million to support 285 FTE and $20.4 million for contract examinations.
    E. For each site that will use the IDES process during fiscal year 
2011 and 2012, please provide the level of funding that specific site 
has been or will be allocated (from any source) to carry out that 
process.
    Response. Expansion of the Integrated Disability Evaluation System 
is still in the planning phase with the Department of Defense. 
Therefore, no specific amount of money has been allocated for this 
population of servicemembers.
    F. For each site that will use the IDES process during fiscal year 
2011 and 2012, please provide the number of servicemembers expected to 
enter the IDES process at that specific site per year.
    Response. Please see the attached spreadsheet, which contains a 
list of military treatment facilities and their anticipated annual 
caseload.


[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]


    G. Is the requested level of funding for fiscal year 2012 
sufficient for all necessary staff to meet staffing targets nationwide 
in general and specifically at the military bases in North Carolina?
    Response. The requested funding level would provide sufficient 
funding for the necessary staffing in fiscal year 2012. This includes 
all military bases in North Carolina.
    H. For fiscal year 2012, does the fiscal year 2012 budget request 
include sufficient funding for VA doctors or contractor services 
necessary to provide timely medical examinations for IDES participants 
nationwide in general and specifically at the military bases in North 
Carolina?
    Response. VBA's fiscal year 2012 budget request included sufficient 
funds for the timely examination of IDES participants by contract 
examiners, where needed.
    I. For each branch of military service, please provide the most up-
to-date performance statistics with respect to the IDES process, 
including the number of servicemembers referred to the IDES process, 
the number of servicemembers who remain in the process, the average 
length of time they have been pending in the IDES process, the average 
time it takes to complete the total process, the average time for claim 
development, the average time to complete medical evaluations, the 
average time to complete the Medical Evaluation Board, the average time 
to complete the Physical Evaluation Board, and the average time to 
complete a VA rating.
    Response. Please see the attached spreadsheet. 

    [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
    
    J. For each military base in North Carolina that is using the IDES 
process, please provide the most up-to-date performance statistics, 
including for each base the number of servicemembers referred to the 
IDES process, the number of servicemembers who remain in the process, 
the average length of time they have been pending in the IDES process, 
the average time it takes to complete the total process, the average 
time for claim development, the average time to complete medical 
evaluations, the average time to complete the Medical Evaluation Board, 
the average time to complete the Physical Evaluation Board, and the 
average time to complete a VA rating.
    Response. Please see the attached spreadsheet.

    [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
    
    K. In total, how many servicemembers currently have been pending in 
the IDES process for longer than 295 days, VA and DOD's goal for 
completing the joint process?
    Response. As of March 6, 2011, 3,796 of the 12,824 Servicemembers 
currently enrolled in IDES have been pending for more than 295 days.

    Question 21. In a January 2011 report, the VA Inspector General OIG 
found that VA ``is not correctly evaluating and monitoring 100 percent 
disability evaluations'' and that, if corrective action is not taken, 
VA ``will overpay veterans a projected $1.1 billion over the next 5 
years.'' Please provide an update on any actions that have been taken 
in response to this report.
    Response. VBA remains committed to paying Veterans correctly and 
assigning appropriate disability evaluations at all levels. We are 
actively working to address the recommendations of the report, and 
resolving the system errors that have contributed to future examination 
controls being removed from records.
    VBA is currently testing a recent system modification to ensure 
that future diaries established through the rating process are not 
removed through other processing actions. Testing is scheduled through 
the end of March 2011, and VBA plans to implement this system 
modification by April 30, 2011; this will prevent the loss of future 
examination controls that are necessary to periodically reevaluate 
temporary 100-percent evaluations. VBA is also working to establish 
appropriate future diary controls within the system for the population 
of cases identified by OIG.
    In January 2011, VBA amended the training lesson for Veterans 
Service Representatives to address timely actions that must be taken on 
future examination notifications. Additionally, a new training lesson 
entitled Permanent & Total Ratings was made available for Rating 
Veterans Service Representatives in March 2011. VBA's National Training 
Curriculum mandates completion of this lesson in FY 2011. This lesson 
provides detailed information on evaluating permanent and total 
disability ratings, and allows participants to apply their knowledge in 
resolving actual case scenarios during training.

    Question 22. It is my understanding that, as one initiative to 
bring down the backlog of disability claims, VA plans to extend routine 
future disability examination requests to the maximum period of five 
years.
    A. Does VA track any data that would reflect how frequently those 
types of routine follow-up examinations reveal an improvement in the 
veteran's disability, how often they reveal a worsening of the 
disability, and how often there is no change? If so, please explain.
    Response. This information is not currently captured in any VA 
systems.
    B. Has VA calculated an estimate of how many Veterans might be 
overpaid or underpaid as a result of this policy or how much in total 
will potentially be overpaid or underpaid? If so, please explain.
    Response. VA has not calculated the overpayments and underpayments 
per the explanation in 22a.

    Question 23. In addition to processing claims in a timely manner, 
it is essential that decisions are accurate in order to avoid delays 
and frustrations for veterans and their families.
    A. How many employees are currently dedicated to VBA's national 
quality assurance program?
    Response. Compensation and Pension Service currently has 49 
employees dedicated to VBA's national quality assurance program. In 
addition, under Section 224 under Public Law (PL) 110-389, Veterans' 
Benefits Improvement Act of 2008, VBA contracted with the Institute for 
Defense Analyses (IDA) over a three-year period to conduct an 
independent assessment of the quality assurance program carried out in 
the VBA. The final report is due to VBA in August 2011. VBA is also 
implementing dedicated quality teams at each of the regional offices. 
The dedicated Quality Review teams will conduct quality reviews as well 
as provide feedback and training on error trends.
    B. For fiscal year 2012, how many employees would be dedicated to 
VBA's national quality assurance program?
    Response. At this time there are no plans to increase the number of 
employees in the National Quality Assurance Program. However, VBA does 
plan to add dedicated quality reviewers within the regional offices, 
which will focus solely on the improvement of quality.
    C. How many cases were reviewed in fiscal year 2010, how many are 
expected to be reviewed during fiscal year 2011, and how many are 
projected to be reviewed during fiscal year 2012?
    Response. We reviewed 46,507 cases for quality in fiscal year 2010. 
We project that we will review over 47,000 cases in both FY 2011 and FY 
2012.
                         general administration
Office of the Secretary
    Question 1. The fiscal year 2012 budget proposal reflects that the 
Office of the Secretary expended $3,000 on Other Services during fiscal 
year 2010, expects to spend $246,000 on Other Services during fiscal 
year 2011, and requests $122,000 for Other Services for fiscal year 
2012.
    Response. NOTE: The expended amount in `Other Services' during 
fiscal year 2010 consisted of $227,000 in actual obligations and a 
reimbursement of $224,000 from Veterans Benefit Administration (VBA) to 
Office of Employment Discrimination Complaint Adjudication (OEDCA) for 
services rendered, which resulted in a net difference of $3,000. 
Because OEDCA is in the same account as OSVA, it is reflected as an 
expenditure adjustment and nets against the `Other Services' line. The 
reimbursement from VBA was recorded against `Other Services.'
    A. Please provide an explanation of how these funds have been used 
or are expected to be used.
    Response. The following are the more significant items covered 
under `Other Services' in FY10:

     $85k--Office of the Secretary--Training (includes eight 4-
day sessions with more than 80 employees from across VA participating)
     $17k--Center for Women Veterans (CWV)--A Women's Summit 
where more than 400 stakeholders attended
     $18k--CWV--stipends to cover the costs of its Advisory 
Committee.
     $16k--Center for Minority Veterans (CMV)--stipends to 
cover the costs of its Advisory Committee
     $18k--CMV Employee Training--including an employee 
participating in the Federal Executive Institute program.

    The following are the more significant items covered under `Other 
Services' in FY11:

     CWV has planned $108k in other services (including a 
committee meeting, a major biennial summit, advisory committee site 
visits, equipment, printing, and supplies)
     CMV has planned $38k in other services (including 
committee meetings and equipment, printing, and supplies)
     Office of the Secretary has planned $97k in other services 
(including equipment, printing, and supplies)

    B. If these are contracted services, what metrics will be used to 
determine whether these services will be used effectively?
    Response. The services are for meetings or events necessary by both 
the CWV and CMV in fulfilling as Advisory Committee requirements. In 
addition, equipment like copiers are leased and not purchased.

    Question 2. Before the House Committee on Veterans' Affairs, 
Secretary Shinseki testified that recent increases in staff for this 
office are due in part to transitioning away from the use of detailed 
employees in that office.
    A. Please provide a breakdown of how many detailed employees 
currently work in the Office of the Secretary, how many have worked in 
that office over each of the past five years, and how many are 
projected to work in that office during fiscal year 2012.
    Response. As of March 30, 2011, two persons are currently on short-
term detail to the Office of the Secretary. Over the past 5 years, 12 
persons were on detail to the Office of the Secretary in 9 distinct 
positions. Duration of these details varied. Three of these detail 
positions were converted to full time positions in the Office of the 
Secretary, and six of the detail positions were eliminated. The 4-
person Center for Faith-Based and Neighborhood Partnerships was also 
transferred from the Office of Public and Intergovernmental Affairs to 
the Office of the Secretary during this 5 year period. This transfer 
also involved temporary detailing of Center employees until funding 
adjustments were coordinated. All Center employees now work in, and are 
funded by, the Office of the Secretary.
    B. How many positions have been converted in fiscal year 2010 and 
fiscal year 2011 from a detailed position to full time employee working 
for the Office of the Secretary? How many of these positions will be 
new FTEs to the Secretary's office in fiscal year 2012?
    Response. Two detail positions were transferred and reassigned to 
the OSVA in FY 2010 and one in FY 2011. These positions were included 
in the OSVA FTE total for that fiscal year.

[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

    C. Once these detailees are shifted back to their original hiring 
offices, how are they reflected in the total number of FTEs in this 
year's budget? Are they reflected as an increase to that office's FTEs 
count or were they always reflected in that office's FTE numbers in the 
past?
    Response. Employees on detail are and continue to be reflected in 
the FTE numbers of their original office.
Board of Veterans' Appeals
    Question 1. According to the fiscal year 2012 budget request, the 
Board of Veterans' Appeals (Board or BVA) experienced a 22% increase in 
case receipts from 2008 to 2010 and expects to receive 66,600 new 
appeals in 2012.
    A. For fiscal years 2009 and 2010, what percentage of case receipts 
involved cases that previously had been remanded by the Board?
    Response. In fiscal year 2009, 32.60% of case receipts (or 16,288 
cases) involved cases previously remanded by the Board.
    In fiscal year 2010, 30.93% of case receipts (or 16,224 cases) 
involved cases previously remanded by the Board.
    B. With the requested level of funding for fiscal year 2012, how 
many decisions does the Board expect to issue during fiscal year 2012?
    Response. The Board expects to issue 49,500 cases during fiscal 
year 2012.
    C. Currently, what is the average case disposition time and what is 
the expected case disposition time during fiscal year 2012 if the 
requested level of funding is provided?
    Response. The Board's current average case disposition time, 
referred to as ``cycle time,'' is 110 days (fiscal year 2011 to date). 
Cycle time measures the time an appeal is physically received at the 
Board until a decision reached, excluding the time that the case is 
with a Veterans Service Organization representative for the preparation 
of written argument. The expected cycle time for fiscal year 2012 is 
140 days.

    Question 2. The December 2010 report from the National Commission 
on Fiscal Responsibility and Reform included this recommendation:

        Reduce Federal travel, printing, and vehicle budgets * * *. We 
        propose prohibiting each agency from spending more than 80 
        percent of its FY 2010 travel budget and requiring them to do 
        more through teleconferencing and telecommuting * * *.

    A. Of the $1.3 million the Board is requesting for travel expenses 
for fiscal year 2012, what portion is attributable to the costs of 
travel (or field) hearings?
    Response. Of the $1.3 million the Board is requesting for fiscal 
year 2012, the Board projects spending $1.1 million on travel 
associated with conducting in-person hearings at field offices.
    B. What accounts for the 37% increase in travel costs since fiscal 
year 2010 (from $948,000 to $1.3 million)?
    Response. The 37% increase in travel costs represents the rising 
costs of air and rail travel, as well as the rising costs of fuel, and 
other incidental travel expenses.
    C. In total, how much was spent on travel hearings during fiscal 
year 2010 and how much is expected to be expended during fiscal year 
2011?
    Response. In fiscal year 2010, the Board spent $804,330 on travel 
for Veterans Law Judges (VLJs) to conduct in-person hearings with 
Veterans and Appellants in field offices. In fiscal year 2011, the 
Board anticipates spending $1,000,000 on travel for VLJs to conduct in-
person hearings in the field, due to the rising costs of air and rail 
travel, as well as the rising costs of fuel, and other incidental 
travel expenses.
    D. Please provide a comparison of the costs to conduct hearings via 
videoconference versus conducting travel hearings.
    Response. The Board spends nearly $1,000,000 per year on travel 
costs for VLJs to conduct in-person hearings with Veterans and 
Appellants in the field. By comparison, there are no travel expenses 
associated with conducting hearings via videoconference. There are 
costs associated with the initial purchase of videoconference 
equipment, as well as minimal maintenance costs for the equipment, but 
those costs are not covered by the Board.
    The increased use of video conference technology also creates a 
time savings. VLJs would have greater flexibility over time management 
because video hearings would be conducted more efficiently from the 
Board's offices in Washington, VLJs would not lose time in the field 
due to travel days or to appellants failing to attend scheduled 
hearings.

    Question 3. According to the fiscal year 2012 budget request, the 
Board now expects to spend over $2.5 million on Other Services during 
fiscal year 2011, which is 177% higher than originally anticipated in 
the fiscal year 2011 budget ($923,000). For fiscal year 2012, the Board 
requests over $2 million for Other Services.
    A. Please provide a detailed itemized list of how these funds would 
be spent in fiscal year 2011. To the extent any of these funds will be 
spent on contracts, please explain the nature of the contract and the 
expected outcomes.
    Response:

                         (Dollars in Thousands)
------------------------------------------------------------------------

------------------------------------------------------------------------
Credit Card Purchases
  Training Credit Card Purchases...........................         $29
  Miscellaneous (locksmith, rental furniture)..............          $3
Customer Service Survey....................................        $300
Office of Resolution Management (BVA shares operational             $67
 cost of discrimination complaints)........................
OGC Hein Online and CyberFed (Federal Register materials             $5
 and Law Journal articles).................................
Government Movers (miscellaneous task service (assemble/            $70
 disassemble/repair workstation))..........................
West Group (legal database)................................        $244
OT Utilities (summer utilities for overtime on weekend)....        $110
All-Shred (sensitive documents destruction)................         $24
FaxPlus (maintenance contract for office fax)..............          $5
Promisel & Korn (electronic research tool).................        $559
Independent Medical Expert (expert medical opinions).......         $60
VA Franchise Funds (Financial Service Center)..............         $27
Payroll support services, fiscal services
  Security and Investigation Centers.......................          $1
Investigative services
  Transcription services
    York...................................................        $250
    Diaz...................................................        $250
    Bell...................................................        $250
------------------------------------------------------------------------

    B. Please provide a detailed itemized list of how these funds would 
be spent in fiscal year 2012. To the extent any of these funds will be 
spent on contracts, please explain the nature of the contract and the 
expected outcomes.
    Response:

                         (Dollars in Thousands)
------------------------------------------------------------------------

------------------------------------------------------------------------
Credit Card Purchases
  Training Credit Card Purchases...........................         $35
  Miscellaneous (services).................................          $4
Office of Resolution Management (BVA shares operational             $67
 cost of discrimination complaints)........................
OGC Hein Online and CyberFed (Federal Register materials             $5
 and Law Journal articles).................................
Government Movers (miscellaneous task service (assemble/            $70
 disassemble/repair workstation))..........................
West Group (legal database)................................        $254
OT Utilities (summer utilities for overtime on weekend)....        $110
All-Shred (sensitive documents destruction)................         $24
FaxPlus (maintenance contract for office fax)..............          $7
Promisel & Korn (electronic research tool).................        $450
Independent Medical Expert (expert medical opinions).......         $60
VA Franchise Funds (Financial Service Center)..............         $28
Payroll support services, fiscal services
  Security and Investigation Centers.......................          $1
Investigative services
  Transcription services
    York...................................................        $300
    Diaz...................................................        $300
    Bell...................................................        $300
------------------------------------------------------------------------


    Question 4. According to the fiscal year 2012 budget request, the 
Board now expects to spend over $400,000 on Supplies and Materials 
during fiscal year 2011, which is 89% higher than originally 
anticipated in the fiscal year 2011 budget. For fiscal year 2012, the 
Board requests $570,000 for Supplies and Materials, which is 169% 
higher than originally requested for fiscal year 2011 and 43% higher 
than the Board now expects to spend during fiscal year 2011.
    A. What accounts for these increased expenditures during fiscal 
year 2011?
    Response. In fiscal year 2010, the Board spent $650,000 on Supplies 
and Materials. The Board's original fiscal year 2011 request for only 
$212,000 for Supplies and Materials was in error, and was not enough to 
meet the Board's actual Supplies and Materials needs.
    B. What accounts for the increase between fiscal year 2011 and 
2012?
    Response. The Board requested $570,000 for fiscal year 2012 in the 
Supplies and Materials category, which represents a 22.8% increase from 
fiscal year 2011 to fiscal year 2010. This request would correct the 
error made by the Board in the 2011 budget request for Supplies and 
Materials.

    Question 5. In fiscal years 2009 and 2010, the BVA published a 
Veterans Law Review using appropriated funds. In connection with the 
Committee's February 2010 hearing on VA's fiscal year 2011 budget 
request, the BVA stated that this law review ``serves as a training 
function'' and that the BVA expected to spend slightly more than 
$34,000 to publish the 2010 edition.
    A. How much was actually spent during fiscal year 2010 on the 
operation and publication of the Veterans Law Review?
    Response. In fiscal year 2010, the total expenditures on 
publication of the Veterans Law Review were $35,885, spent almost 
entirely on printing costs.
    B. How much is expected to be expended on the operation and 
publication of the Veterans Law Review during fiscal year 2011 and how 
much is requested for this purpose in the fiscal year 2012 budget?
    Response. In fiscal year 2011, the expected expenditure for the 
Veterans Law Review (again almost entirely for printing costs) is 
approximately $27,000. This decrease in funding reflects a more 
accurate view of the requisite supply of volumes to be printed.
    In fiscal year 2012, the Board requested $90,000, which was an 
over-projection, based on actual costs and demand.
    C. What specific goals does BVA expect to accomplish through this 
initiative and what metrics are in place to gauge whether this 
initiative is meeting those goals?
    Response. The goal of the Veterans Law Review is to provide a forum 
to address the legal issues and policy concerns faced by an expanding 
universe of Veterans' benefits law. It also provides interested Board 
attorneys and Veterans Law Judges with additional experience in 
researching, editing, and writing legal articles, as well as experience 
with the management of a complex project. The training aspect of 
participation in the Veterans Law Review is of great value to the Board 
in accomplishing its mission.
    It is important to note that the Board sponsors the publication of 
the Veterans Law Review by providing printing costs and occasional 
meeting space. All employees who contribute do so largely on their own 
time, without detriment to serving the Veterans whose appeals are 
before the Board. The Board's goal in sponsoring the Veterans Law 
Review is to increase scholarship in the area of Veterans law. It also 
provides an important and exciting learning opportunity for interested 
Board attorneys and Veterans Law Judges to explore areas of the law in 
a critical and in-depth manner that is not generally possible in the 
day-to-day operations of the Board. In an indirect way, this serves as 
an important supplement to the Board's other training programs to 
support the professional growth and development of our staff. The Board 
does not have any metrics in place to measure whether these goals are 
being met because these are not the types of goals that are subject to 
clear measurement. From the experience gained in publishing the first 
three volumes of the Veterans Law Review, however, the Board feels 
strongly that the very small costs of publishing the document are more 
than outweighed by the personal growth and development of our staff.
    D. Does VA consider the publication of this law review to be a 
mission critical activity?
    Response. The Board considers the legal scholarship created in the 
Veterans Law Review to play a critical role in the development of a 
robust legal community practicing Veterans law. The insight gained 
increases awareness in the Veterans bar and will increase the quality 
of the arguments before the Board, the United States Court of Appeals 
for Veterans Claims, the United States Court of Appeals for the Federal 
Circuit, and the Supreme Court in this unique area of law which, even 
after three decades of judicial review, is still in its relative 
infancy compared to most other areas of Federal jurisprudence.
    E. Has BVA or VA approached any law schools, bar associations, or 
other entities to determine whether they would be willing to publish a 
Veterans Law Review?
    Response. By creating the Veterans Law Review, the Board sought to 
fill an educational void in the increasingly complex world of Veterans' 
benefits appellate adjudication. To date, the Board has not approached 
any law schools, bar association, or other entities to determine if any 
of them would be willing to take over the publishing of this law 
journal.

    Question 6. The fiscal year 2012 budget request includes $73.3 
million to support 544 employees for the Board.
    A. Please provide a breakdown of the positions that would be filled 
in fiscal year 2012 (such as members of the Board, professional staff, 
and administrative staff) and the number of staff for each type of 
position.
    Response. The breakdown of the 544 positions in fiscal year 2012 is 
as follows:


------------------------------------------------------------------------

------------------------------------------------------------------------
Attorney Adviser...........................................       345
Veterans Law Judge.........................................        64
All Other..................................................       135
------------------------------------------------------------------------

    B. How many members of the Board (or Veterans Law Judges) currently 
are employed by the BVA?
    Response. The Board currently employs 59 Veterans Law Judges, with 
five appointments currently pending at the White House.
    C. Please provide a breakdown of the percentage of Board members 
who were existing Board employees when selected to become a Board 
member; the percentage who were selected from other VA offices; and the 
percentage who were selected from outside of VA.
    Response. With respect to the Board's current 59 Veterans Law 
Judges, the percentage who were, or were not, already Board employees 
when selected is broken down as follows:

     Percentage of Board members who were existing Board 
employees (95%)
     Percentage who were selected from other VA offices (5%)
     Percentage who were selected from outside of VA (0%)
General Counsel
    Question 1. Within the Office of General Counsel, Professional 
Staff Group (PSG) VII represents VA before the U.S. Court of Appeals 
for Veterans Claims.
    A. How many employees currently are assigned to PSG VII?
    Response. As of March 15, 2011, there are 119 FTEE assigned to PSG 
VII (one is currently serving on active duty with the Navy).
    B. Currently, what is the average caseload handled by PSG VII 
attorneys?
    Response. There are approximately 40 active cases per attorney on 
average. An active case is one in which the Secretary's dispositive 
pleading has yet to be filed.
    C. For fiscal year 2012, what level of funding would be dedicated 
to supporting PSG VII and how many employees would that level of 
funding support?
    Response. The FY 2012 budget request would allocate $17.1M in 
funding to PSG VII, which would support 131 FTEE.
    D. With the requested level of funding for fiscal year 2012, what 
would be the average caseload for attorneys in PSG VII?
    Response. Barring any unforeseen events, we anticipate that the 
caseload would average around 36 active cases per attorney at the 
projected FY 2012 funding level.
    E. How many motions for extension of time did PSG VII file during 
fiscal year 2010?
    Response. PSG VII filed 3,411 extension motions on behalf of the 
Secretary during FY 2010, which represented approximately 284 extension 
motions per month on average.
    F. To date, how many motions for extension of time have been filed 
by PSG VII during fiscal year 2011?
    Response. During the period extending from October 1, 2010 to 
February 28, 2011, PSG VII filed 642 extension motions on behalf of the 
Secretary, which represented approximately 128 extension motions per 
month on average.

    Question 2. For many years, the Office of General Counsel has been 
involved in a project known as the VA Regulation Rewrite Project.
    A. What is the status of that project?
    Response. VA has published 20 Notices of Proposed Rulemaking 
(NPRMs), which encompass all of VA's compensation and pension 
regulations in Part 3 of 38 CFR. Because the Compensation and Pension 
(C&P) Regulation Rewrite Project is a major, comprehensive 
reorganization, updating, as well as redrafting of these regulations, 
VA compiled its responses to public comments submitted on all 20 of the 
proposed rules into a single final rule document. Due to the enormity 
of the project and based upon requests from several Veterans Service 
Organizations (VSOs), VA is giving the public and VSOs an additional 
opportunity to review and comment on the entire new Part 5 in a second, 
consolidated NPRM. Once this large NPRM is published and the public has 
had an opportunity to comment, VA will make final revisions and publish 
the Final Rule.
    B. Please provide a timeline of the remaining milestones for this 
project.
    Response. The current C&P Regulation Rewrite Project schedule calls 
for publication of the consolidated NPRM by November 1, 2011, and 
publication of the Final Rule by January 1, 2013. VA's Office of the 
General Counsel (OGC) will continue to oversee the transition to the 
new Part 5 CFR from the existing Part 3 provisions for several years, 
until Part 3 provisions are no longer applicable to any Veterans' 
claims.
    C. To date, how much has been expended in connection with this 
project and how much is requested for fiscal year 2012?
    Response. The C&P Regulation Rewrite Project is not a separate 
entity nor is it separately funded. OGC's Office of Regulation Policy & 
Management (ORPM) is responsible for the project which consumes about 
10% of its time.
    ORPM's budget has ranged from $1.3M-1.4M a year. Therefore, the 
cost associated with the C&P Regulation Rewrite Project is 
approximately $130-140K per year and amounts to about $1M since 2004.
    Consistent with previous fiscal years, OGC anticipates devoting 
approximately $140K to the project in FY 2012.
    D. How many Office of General Counsel employees currently are 
dedicated to that project?
    Response. Currently, two ORPM FTEE in OGC are assigned 
responsibilities associated with the C&P Regulation Rewrite Project. 
The Deputy Director for ORPM supervises the project and spends 
approximately 75% of his time managing that process. One additional 
ORPM employee spends about 10% of her time on the project. In addition, 
two attorneys--one from C&P Service and one from the Board of Veterans 
Appeals (BVA)--remain detailed to ORPM for the Project. ORPM uses 
unpaid student interns for academic credit. Other attorneys in OGC 
perform legal reviews for the proposed regulations, as they do for all 
VA regulations, but their time spent on this project is not tracked 
separately from their other rulemaking work.
    E. With the funding requested for fiscal year 2012, how many Office 
of General Counsel employees would be dedicated to this project during 
fiscal year 2012?
    Response. There would be no change in the number of OGC employees 
dedicated to the C&P Regulation Rewrite Project during fiscal year 
2012.
Office of Management
    Question 1. The fiscal year 2012 budget request for the Office of 
Management includes the following information:

        As a result of the centralization of certified invoice payments 
        at the [Financial Services Center], continued improvements have 
        been made in reducing interest penalty payments and increasing 
        discounts. Centralization resulted in a decrease of 24% in 
        interest penalties per million dollars disbursed to commercial 
        vendors from $47 per million in 2009 to $35 per million in 
        2010.

    A. In total, how much did VA spend on interest penalties during 
fiscal year 2010?
    Response. VA spends $854.3K on interest penalties during fiscal 
year 2010.
    B. In total, how much is expected to be spent during fiscal years 
2011 and 2012 on interest penalties?
    Response. During fiscal year 2011 $732.7K is expected to be spent 
and $696.0K in fiscal year 2012.

    Question 2. According to the fiscal year 2012 budget request, the 
Office of Management now plans to spend over $50 million on Other 
Services during fiscal year 2011, which is 35% higher than the amount 
VA originally anticipated would be spent on Other Services during 
fiscal year 2011. For fiscal year 2012, the Office of Management is 
requesting over $42 million for Other Services.
    A. What accounts for that increase in spending during fiscal year 
2011?
    Response. The 2011 current estimate for ``Other Services'' is $13.1 
million above the amounts identified in the original 2011. This funding 
is for initiatives that were scheduled to be obligated at the end of 
2010, but will now be obligated in 2011. These initiatives will help 
transform Department-level management by improving accountability, 
efficiency, and Veteran safety throughout the system.
    Also contributing to the higher 2011 estimate is an increase in 
billing of $3.2 million for payroll services from the Defense Finance & 
Accounting Service (DFAS).
    B. Please provide an itemized list of what expenditures would be 
made with these funds during fiscal year 2011 and fiscal year 2012. To 
the extent any of these funds will be spent on contracts, please 
explain the nature of the contract and the expected outcomes.
    Response:
  2011 ``Other Services'':
     $31.3 million for the Defense Finance & Accounting 
Services (DFAS) contract. DFAS provides VA with all of its payroll 
services.
     $3.9 million for Office of Business Oversight work in the 
areas of internal controls, contractual review, A-123 audits and Open 
Government.
     $4.3 million for contracts to support: Audit readiness 
contracts; Service Level Agreements (SLAs) for IT and H.R. support and 
services provided by the Financial Services Center (FSC); training; 
space, lease and moving expenses
     $11.4 million for transformation and financial management 
initiatives that will improve Department-level management, 
accountability, and efficiency, including development of an integrated 
operating model and cost accounting enhancements.
  2012 ``Other Services'':
     $32.7 million for the Defense Finance & Accounting 
Services (DFAS) contract. DFAS provides VA with all of its payroll 
services.
     $3.6 million for Office of Business Oversight work in the 
areas of internal controls, contractual review, A-123 audits and Open 
Government.
     $1.5 million for contracts to support: Audit readiness 
contracts; Service Level Agreements (SLAs) for IT and H.R. support and 
services provided by the Financial Services Center (FSC); training; 
space, lease and moving expenses.
     $4.4 million for transformation and financial management 
initiatives that will improve Department-level management, 
accountability, and efficiency, including development of an integrated 
operating model and cost accounting enhancements.

    Question 3. According to the fiscal year 2012 budget request, the 
Office of Finance within the Office of Management manages the financial 
operations at VA's Debt Management Center.
    A. For the completeness of the record, please describe the scope of 
responsibilities of the Debt Management Center.
    Response. The Debt Management Center (DMC) is responsible for 
collecting debts that arise from an individual's participation in any 
VA benefit program. If DMC is unable to affect collection, they are 
responsible for referring the debt to the Department of the Treasury 
for offset under the Treasury Offset Program or further collection 
action by collection agencies under contract with the Department of the 
Treasury.
    B. How many telephone lines does the Debt Management Center 
currently operate and how many operators are dedicated to answering 
those telephones?
    Response. DMC is currently operating 28 toll-free telephone lines 
with 37 operators. To provide expanded service to Veterans, the DMC 
increased the telephone service hours from 7:30 AM to 6:00 PM effective 
September 2010.
    C. How many telephone operators are expected to be assigned to the 
Debt Management Center during fiscal year 2012?
    Response. DMC expects to increase staffing levels to 40 operators 
within the next three months and maintain that staffing level into 
fiscal year 2012. DMC will continue to monitor workload throughout 
fiscal year 2011 and into fiscal year 2012 and will adjust staffing 
levels as needed.
    D. During fiscal year 2010, how many debts were referred to the 
Debt Management Center, what was the total value of those debts, and 
how much did the Debt Management Center recoup?
    Response. DMC provided collection services for all VA benefit 
programs, which include education, compensation, pension, and loan 
guaranty. Debts are automatically created and referred to DMC when an 
adjustment is made to a beneficiary's award that reduces his/her 
entitlement. During FY 2010, DMC received 595,354 new debts valued at 
$1,349,099,996. Collections/offsets for the fiscal year on all debts 
totaled $1,018,347,000.
    E. How many debts are expected to be referred to the Debt 
Management Center during fiscal year 2011 and during fiscal year 2012?
    Response. DMC experienced an increase of 37% in total number of new 
debts referred from fiscal year 2009 to fiscal year 2010. This is 
attributable, for the most part, to the implementation of the new Post-
9/11 GI Bill Program, where an individual can have multiple debts on 
their record at any given time. For example, an individual could have 
an outstanding advance payment as well as tuition and fees overpayment 
and a housing allowance overpayment all at the same time. Based on the 
expected number of Post-9/11 GI Bill Program participants in receipt of 
benefits and the increase in related debts experienced in fiscal year 
2010, the DMC expects the percentage of new debts will increase by 
similar amounts in fiscal years 2011 and 2012. Based on that 
percentage, DMC expects to have 815,881 new debts referred in fiscal 
year 2011 and 1,117,763 new debts referred in fiscal year 2012.
    F. What performance measures are used to determine the 
effectiveness of the Debt Management Center?
    Response. DMC currently has six performance measures they use to 
determine effectiveness of operations. They are:

    (1) Timeliness of Deposits (Goal--Deposit within 2 business days)
    (2) Timely Response to Congressional Inquiries (Goal--Respond 
within 5 business days)
    (3) Timely Response to General Correspondence (Goal--Respond within 
12 business days)
    (4) Lost Call Rate (Goal--Maintain a lost call rate of less than 
5%)
    (5) Timely Application of Unapplied Funds (Goal--Identify and apply 
funds within 60 calendar days)
    (6) DMC Efficiency and Effectiveness (Goal--Meet or exceed expected 
rate of return)
    G. In terms of those metrics, please explain the performance of the 
Debt Management Center during fiscal year 2010 and to date during 
fiscal year 2011.
    Response. During FY 2010, DMC performed accordingly:

    Timeliness of Deposits--Averaged deposits within 1 day measured 
against a goal of 2 business days.
    Timely Response to Congressional Inquiries--Averaged responses 
within 4.21 days measured against a goal of 5 business days.
    Timely Response to General Correspondence--Averaged responses 
within 11.12 business days measured against a goal of 12 business days.
    Lost Call Rate--Averaged a 2.28% lost call rate against a goal of 
less than 5%.
    Timely Application of Unapplied Funds--Averaged application within 
49 calendar days measured against a goal of 60 calendar days.
    DMC Efficiency and Effectiveness--Achieved a rate of return of 
$114.25 for every dollar spent measured against a goal of $80.88.
    During FY 2011 to date, DMC performed accordingly:

    Timeliness of Deposits--Averaged deposits within 1.2 days measured 
against a goal of 2 business days.
    Timely Response to Congressional Inquiries--Averaged responses 
within 4.74 business days measured against a goal of 5 business days.
    Timely Response to General Correspondence--Averaged responses 
within 11.5 business days measured against a goal of 12 business days.
    Lost Call Rate--Averaged a lost call rate of 2.22% measured against 
a goal of less than 5%.
    Timely Application of Unapplied Funds--Averaged application within 
52 calendar days measured against a goal of 60 calendar days.
    DMC Efficiency and Effectiveness--For first quarter, achieved a 
rate of return of $136.24 for every dollar spent measured against a 
goal of $125.00.
    H. What would be the expected performance outcomes for the Debt 
Management Center during fiscal year 2012?
    Response. DMC plans to maintain current performance measures and 
expects to meet or exceed those performance measures during fiscal year 
2012.
Office of Human Resources and Administration

    Question 1. In connection with the Committee's February 2010 
hearing on VA's Fiscal Year 2011 budget request, VA provided the 
following explanation for the $14 million difference between what had 
been requested for travel for fiscal year 2010 ($2.4 million) for the 
Office of Human Resources and Administration and the amount then 
expected to be spent on travel by that office ($16.8 million):

        Under VA's new corporate level training program, all travel and 
        training are managed, obligated and reported by the [Human 
        Capital Investment Plan (HCIP)] at the corporate level. Costs 
        that previously may have been obligated and reported at the 
        field level are now reported at the corporate level under HCIP.

    A. Please explain in more detail the change in the reporting 
methods for travel and training costs.
    Response. Last year, VA Learning University assumed responsibility 
for managing all Human Resources and Administration sponsored training 
related travel. This effectively centralized this function and created 
a level of efficiency in support of VA's training goals.
    During the first quarter of FY 2011, VALU has provided over 54,000 
training opportunities (Functional Specific Training, Leadership and 
Management, Project/Program Manager Training, Transformation Training, 
Customer Service, and Union Training for Managers/Leaders) utilizing 
various modalities.
    B. As a result of this corporate level reporting of travel training 
costs, were there decreases in the travel budgets for other offices 
during fiscal year 2010? If so, please identify any such decreases.
    Response. VA believes that as we implement more VALU on-line 
training, travel budgets will decrease and VA has incorporated this 
trend in its estimates. VA estimates VA-wide travel of $252 million 
which is expected to decrease by $7 million or 2.7% from the 2011 
estimated level.
    C. What metrics are used to determine which staff needs to travel?
    Response. Our travel cost is executed against VALU sponsored 
training programs derived from a requirements process that identifies 
critical training needs and fills training gaps identified by the VA 
Administration(s) and VA Staff Offices. VALU also provides training to 
the field in centralized locations where there are areas of high 
concentration of VA employees allowing for a reduction in expected 
travel that would have been incurred to support the training efforts.
    D. What options (such as video conference, webinars, or local 
options) were explored to reduce the costs to the taxpayer?
    Response. The vast majority of training conducted by VALU ( HRA) is 
conducted through its online Learning Management System (LMS) which is 
the most cost effective way to train thousands of VA employees. 
Training is also being conducted through various modalities, including 
non-LMS online training, video conferencing, training hubs/clusters in 
the field, and at various existing training facilities (such as the VA 
Acquisition Academy, IT Training Academy, Office of Personnel 
Management, etc.) This technical training supports our VA professional 
employees deployed in very small numbers in any specific facility, and 
needing very specific training targeted to their profession. The 
training venues offer highly interactive, case study and scenario-based 
training to large numbers of a specific professional group (i.e. 
financial management professionals). This training modality is an 
efficient and effective means of targeting our professional career 
fields.

    Question 2. In connection with the Committee's February 2010 
hearing on VA's fiscal year 2011 budget request, VA projected that, 
during fiscal year 2011, 8,800 employees would take trips and that each 
trip would cost on average $2,000, at a total cost of $17.6 million in 
travel expenses for the Office of Human Resources and Administration. 
According to the fiscal year 2012 budget request, the Office of Human 
Resources and Administration now expects to spend over $27 million on 
travel during fiscal year 2011, which is nearly $10 million more than 
this office requested for travel funds in VA's fiscal year 2011 budget 
proposal. For fiscal year 2012, this office is requesting over $28 
million for travel expenses.
    A. To date, how many employees have traveled during fiscal year 
2011 and what was the average cost per trip?
    Response. Through February 2011, VALU has expensed travel cost for 
2,194 VA employees taking training and the average cost for fiscal year 
2011 is $1,196.82 per trip. Some employees have travelled more than 
once. The total cost of VALU sponsored travel is $3.8 million through 
February 2011.
    B. Has this office made any changes in light of this recommendation 
of the National Commission on Fiscal Responsibility and Reform: 
``Reduce Federal travel.'' If so, please explain.
    Response. Yes. We are addressing this by providing training 
conference venues where we are able to reach a larger number of VA 
employees in a centralized location and reduce the number and frequency 
of smaller scale technical training events. We are also providing the 
vast majority of our training courses via VA's online LMS.
    C. During fiscal year 2011, how was the additional $10 million now 
allocated for travel originally expected to be spent?
    Response. The $10 million reflected in the current budget for 
travel was originally requested in FY 2011 to fund VA staff training.
    D. What factors account for the over $1 million increase in 
expected travel expenses between fiscal year 2011 and fiscal year 2012?
    Response. The 4.7 percent increase in travel cost from FY 2011 to 
FY 2012 is primarily due, in part, to anticipated inflation.
    E. For fiscal year 2012, how many trips is the $28 million expected 
to support?
    Response. We expect that $28 million would support the travel of 
over 13,000 trips to training courses

    Question 3. For fiscal year 2012, the Office of Human Resources and 
Administration is requesting over $309 million for Other Services.
    A. Please provide a detailed itemized list of how these funds are 
expected to be spent.
    Response. The majority of the Other Services category of 
obligations is for contracts ($308.6 million) and is detailed in the 
response to 3B. The remaining $790 thousand is for maintenance and 
repair services, including the repair of furniture and equipment.
    B. To the extent any of these funds will be spent on contracts, 
please explain the expected nature of the contract and the expected 
outcomes.
    Response. The Other Services category of obligations includes the 
contracts detailed below.
Training, Development and Management:
    Corporate Senior Executive Management Office ($9.5 million): The 
Corporate Senior Executive Management Office (CSEMO) centrally manages 
the recruitment actions for all 407 executive positions, has oversight 
of the VA-wide corporate Executive Resources Board, oversees and 
manages Executive Performance Management, leads the new VA SES 
Orientation Program and provides formalized SES On-Boarding. 
Initiatives under the Corporate Management Office include executive 
coaching and leadership development, the creation of a new performance 
management system that makes meaningful distinctions in performance, 
and the development of a collaborative Web site for VA executives.
    Leadership Assessment/Competency ($1 million): Targeting senior 
leaders, managers and supervisors, this contract is aimed at assessing 
and developing leaders across VA to foster and support a strong, 
capable leadership corps, and ensure that VA leaders have the skills 
and proficiency to effectively lead people and programs. Program 
evaluation elements will complement organizational leadership 
evaluation and assessments performed by the National Center for 
Organizational Development. Evaluation activities will include a review 
and acceptance of proposed certification and standards by VA and OPM 
general counsel.
    Leadership Infusion ($4.3 million): This initiative procures seats 
in pre-designed and custom leadership and management training programs 
through the U.S. Office of Personnel Management (OPM) Center for 
Leadership Capacity Services (CLCS). These pre-designed training 
programs are designed to increase proficiency in each leadership 
competency and improve performance at the supervisor, manager, and 
executive levels of across the Department.
    Basic/Advanced Supervisory Management Training ($30.5 million): To 
Reach nearly 22,000 managers and supervisors, VA has implemented an 
enterprise-wide, corporate university approach to supervisory and 
management training. This initiative includes development of all 
aspects of competency-based basic and advanced supervisory and 
management training programs, development and delivery of training 
using multiple modalities and production of documents and materials 
needed to conduct instructor-based training, and analysis, design, and 
development support to VA production staff to produce video, VA 
knowledge network satellite, graphics, and eLearning materials. In 
addition, the project will include the testing of training materials 
and implementation of training programs and evaluations.
    Transformational Leadership ($10 million): This contract will 
enable design, development, and delivery of training programs that 
result in increased proficiency in each competency and enable 
optimization of performance for leaders at the supervisor, manager, and 
executive levels of leadership. The proposal reflects five major facets 
of work: (a) development of a Transformational Leadership Competency 
Model, (b) a framework for senior leader training identified as the 
Senior Leadership Academy, (c) options for manager and supervisor 
training, (d) objectives for program related assessment and evaluation 
through engagement with the National Center for Organizational 
Development and (e) linkages with the VA Transformation Communication 
Strategy.
    National Center for Organizational Development (NCOD) ($3.6 
million): NCOD will evaluate the effectiveness of the VA's Human 
Capital Improvement Plan (HCIP) initiatives through the development of 
an HCIP performance tracking dashboard, 360 degree assessments of 
managers, supervisors and executives, and onsite Organizational 
Assessments for identified VA Organizations to assess specific areas of 
focus (e.g., Information Technology, Human Resources). NCOD will 
conduct assessments utilizing multiple measures (surveys, focus groups, 
interviews, etc.) to objectively evaluate organizations within VA, 
including employees and leadership. Results from the assessments will 
guide and support ongoing HCIP initiatives and training development to 
ensure that curriculum meets identified gaps. NCOD will also implement 
the Civility, Respect, and Engagement in the Workforce (CREW) 
initiative across all of VA. CREW was created to improve employee 
satisfaction and success in meeting performance measures while 
decreasing conflict in the workplace. Finally, NCOD will expand the VHA 
All Employee Survey (AES) to encompass all VA employees once per year 
and will provide the necessary coordinator training, organizational 
mapping, marketing activities, administration coordination, data 
analysis and presentation, and support for action plan development.
    Office of Information and Technology (OI&T) Workforce Training 
Program ($28.7 million): Contractor support is needed to both maintain 
VA's OI&T Supervisor competency model and implement it for CIOs and 
application software developers. The scope of the required role-
specific professional development activities covers the following 
primary tasks:

     Provide administrative support for the establishment of a 
program office to establish processes and provide administrative 
support for program review, development of program milestones, resource 
allocation, and monitor milestone progress;
     Provide operations and maintenance support for the 
Information Security Officer (ISO) Competency Model and develop 
courseware to fill gaps in the supervisor curriculum;
     Implement the CIO Professional Development Program;
     Initiate and implement Application Software Developers 
Professional Development Program;
     Provide operations and maintenance support for the OI&T 
Supervisory Program and develop courseware to fill gaps in the 
Supervisory Training Program curriculum;
     Develop and implement an On-Boarding Program to orient and 
integrate new employees into the Office of Information and Technology;
     Develop and implement an intern program to begin building 
bench strength and a labor pool in newer technologies; and
     Develop and implement a vendor-supplied certification and 
voucher program that includes IT-related technical and professional 
development certification.

    HR Academy ($5.8 million): The H.R. Academy will support the more 
than 3,800 VA H.R. professionals ranging from GS-7 to GS-15 in their 
career development, skills, and abilities. A gap analysis of 22 core 
competencies and specialized skills determined several areas in need of 
improvement. By closing the known gaps through a standardized, 
organized H.R. Academy and associated curricula, VA H.R. professionals 
will gain the ability to advance their proficiencies in order to 
provide improved service to clients and customers. Academy plans call 
for the implementation of certification programs as well the creation 
of a cadre of exemplary H.R. professionals who can provide consultation 
and operational service at the highest levels of industry standards. 
The H.R. Academy will be a virtual ``Academy'' that provides course 
curricula at three levels of practice: Practitioner, Expert 
Practitioner, and Advanced/Leader. The curricula will consist of online 
and classroom training programs that are easily available through a 
variety of vendors and modalities, cost-effective, and demonstrably 
able to close proficiency gaps.
    VA Acquisition Academy ($19.9 million): Specifically mandated by 
the Office of Federal Procurement Policy, is the requirement to 
establish Federal Acquisition Certification-Program/Project Managers 
(FAC-P/PM) as a structured career development program for P/PMs 
throughout Federal civilian agencies. The Academy will be designed to 
address gaps in program and project management skills critical to the 
success of major departmental initiatives. In particular, it will train 
the Acquisition and Information Technology workforce and other 
employees requiring project and program management training and/or 
certification to meet the FAC-P/PM competencies. The project will 
acquire commercial or government training in support of Supply Chain 
Management (SCM) and other acquisitions and logistics management 
curricula, provide training for employees requiring Contracting 
Officer's Technical Representative (COTR), and support the formation of 
the VA Facilities Management Academy program. The development of 
Project Management skills meets another goal: the shortage of project 
management skills among IT and other critical mission occupations have 
resulted in costly and poorly managed programs in the past.
    Program Based Training ($32.7 million): The purpose of this project 
is to design, develop, and implement program based training for 
approximately 40,000 employees in cross-cutting career fields not 
previously identified for action. Examples of career fields include all 
VA Staff Offices and new groups set up to implement the 13 major 
initiatives, which represent the Department's highest priorities and 
include Management Analysts, Program Analysts, Budget Analysts, 
Accountants, Auditors, Executive and Staff Assistants, Human Resources 
Liaisons, Paralegals and Legal Assistants, Project Managers, and 
Contracting Officers Technical Representatives. These training programs 
shall be offered in a wide variety of training methodologies including 
e-Learning, facilitated and instructor-led group events, and 
independent study.
    Workforce Planning and Career Broadening ($26.2 million): Focused 
on ensuring that the VA is prepared for the future and on the 
development and retention of a skilled workforce, these initiatives 
will first target 44,000 VA employees in mission-critical positions. 
The VA will create a workforce planning program to centrally coordinate 
the development and retention of a critical staff throughout the entire 
Department.
    VA Learning University ($7.7 million): VA Learning University 
(VALU) contracts will cover program expenses associated with providing 
educational programs to the Department's employees through established 
learning technology infrastructure. While core programs rely heavily on 
remote and on-line training delivery through the Department's Learning 
Management System to minimize costs, VALU will also utilize Leadership 
VA, Mentor Training to support the VA Central Office Leadership 
Development Mentoring Program, the Aspiring Leaders Program and other 
special emphasis training programs.
    Skillsoft License renewals ($1.6 million): This ongoing contract 
will continue to provide VA employee access to online courses and 
digital online books, job aids, educational reference materials and 
other courseware through OPM's Government Online Learning Center. The 
content is available to VA employees through the VA Learning Management 
System.
Improvements to Human Resources Processes and Systems:

    Hiring Reform: Improving VA Central Office H.R. Service (COHRS) and 
Knowledge Management ($5.5 million): One of the major goals of this 
initiative is to streamline the VA's processes for recruiting and 
hiring qualified personnel. This contract will support H.R. business 
process reengineering, service level agreements, new standard operating 
procedures, employee competency assessments and the creation of 
individual development plans. It will include the development of 
libraries of up-to-date position descriptions and functional statement 
for core positions, the design and implementation of an on-boarding 
tool, workload tracking tool, redesign the COHRS Web site, and the 
development of universally applicable position descriptions/functional 
statements for identical work performed Department-wide, and the 
development of a Knowledge Management system.
    Human Resources Information System ($53.5 million): This project is 
the central component of an overall VA H.R. enterprise-level initiative 
that will upgrade the VA's antiquated COBOL-based H.R. processing 
systems. The new Human Resources Information System (HRIS) will replace 
the existing paper driven Personnel and Accounting Integrated Data 
System (PAID) with an ``off-the-shelf'' solution that will be provided 
by an approved OPM Human Resources Line of Business Shared Service 
Center (SSC). The SSC provider will offer proven modern HRIS services 
to VA for a fee, based on the nature of the services provided and the 
number of employees serviced in a year. This service will eliminate the 
manually laden basic transactional and maintenance work by current H.R. 
staff associated with PAID, paper driven processes, and disconnected 
applications.
    Recruitment/Centralized Intern Hiring Projects ($8.2 million): To 
meet VA's succession planning needs into the future, VA will need to 
strengthen its employment pipeline by consolidating its various 
internship programs. Focused recruitment will ensure new talent by 
increasing the number of Presidential Management Fellows and other 
student/graduate appointments. Other recruitment contracts will improve 
the process and tools for hiring, the on-boarding process, and 
retention of acquired talent.
    Veterans Employment Initiatives ($16.4 million): Contract funds 
will support the implementation of VA's Veterans Employment Strategic 
Plan to support increased hiring of Veterans at VA and support the 
President's Executive Order on Veterans employment. The recruiting, 
retention, and reintegration program is designed to recruit from a pool 
of 23 million Non-VA Veterans, retain the 90,000 VA Veteran employees 
currently working for the Department, increase the percentage of 
Veterans employed to VA established goals, and provide reintegration 
assistance for the 7,000 VA Military Servicemembers who are eligible 
for deployment. The contract funds will be used to stand up a new 
Veteran recruiting, retention, and reintegration office and maintain a 
virtual career assessment center to assist in transitioning the 
military employee back to the workplace.
Safety and Health:

    Worklife and Health and Wellness Initiatives ($5.3 million): 
Collectively, these initiatives address the quality of the work 
environment and are designed to improve employee performance, lower 
sick leave usage and increase productivity by promoting a positive 
life-style and a healthful working environment. Based on an agreement 
between VA and the Department of Health and Human Service, Federal 
Occupational Health (FOH), the objective of this program is to provide 
a range of options to help employees and their families balance 
personal and workplace responsibilities at every life stage. The FOH 
Wellness/Fitness Program includes access for all VA employees to an on-
line health information program offering: a comprehensive lifestyle 
management center, on-line health risk assessment, tracking programs, 
personal improvement programs, and an online health encyclopedia.
    Occupational Safety and Health ($4.1 million): Occupational Safety 
and Health (OSH) will implement initiatives contained in the Worker's 
Compensation and Safety Strategic Plans, recommendations made by the 
Office of Inspector General in collaboration with Administration 
members of the VA Worker's Compensation and Safety Steering Committees. 
Initiative contracts will be dedicated to improving safety and workers' 
compensation program management (e.g., developing and implementing 
worker's compensation case management), educational products, and 
safety surveys to provide improved program support and oversight. OSH 
expects to reduce program costs through the prevention of injuries and 
illnesses and by the reduction in employee injury costs, saving VA 
dollars and returning employees to work.
Other Program Initiatives:

    Alternative Dispute Resolution ($1.5 million): Increased emphasis 
on the VA's ADR program is expected to reduce conflict in the workplace 
and decrease the amount of time and money spent on EEO complaints and 
grievances. In order to promote leadership skills in the areas of 
effective communication, negotiation and problem solving, ORM has 
developed Department-wide curriculum for VA leaders on managing 
conflict. Ongoing Alternative Dispute Resolution (ADR) contract funds 
will enable ORM to continue implementation of a program that promotes 
leadership skills and conflict competency to include awareness of 
behaviors that escalate conflict, and skill in resolving disputes at 
the earliest stage possible. Contract funding will also support 
continued operation of the Resolution Support Center (RSC), a full-
service hotline established to serve as an additional resource to 
managers, employees and Veterans through which questions can be raised 
and consultative services and referrals provided by subject matter 
experts. In FY 2010, this program saved VA an estimated $80 million in 
costs associated with protracted EEO complaints.
    EEO and Diversity Programs ($10.8 million): The VA processes Equal 
Employment Opportunity (EEO) complaints for VA employees, applicants 
for employment, and former employees. Statutorily mandated complaint 
processing services include counseling, mediation, procedural 
determinations, and investigations. These services are provided through 
a nationwide network of ORM field operations offices. Contract funds 
are used for contract investigators, as well as, transcription services 
to capture the testimony of witnesses. VA will also continue to 
implement the Department-wide Diversity and Inclusion Strategic Plan 
for FY 2009--2013. This Plan represents a major transformation of the 
diversity management function in VA to a broader, more inclusive 
paradigm. Contract funds in the Office of Diversity and Inclusion (ODI) 
will support the implementation of the Plan's strategies such as 
employee training, leadership development, and compliance oversight in 
the areas of diversity and disability program management to avoid 
costly liability associated with non-compliance with statutory 
obligations and EEOC requirements. ODI will expand its diversity-
focused internship program, fully implement an EEOC-compliant 
Reasonable Accommodations Case Management System and expand the use of 
its centralized account to fund reasonable accommodations in support of 
the Americans with Disabilities Act Amendments Act of 2008 (ADAAA).
    Labor-Management Relations ($5.6 million): LMR promotes successful 
labor-management relationships that allow the Department to effectively 
manage its workforce while meeting its labor relations obligations. 
This contract effort will improve the relationship between labor unions 
and management by providing training to encourage and establish 
cooperative and productive labor-management partnerships. A range of 
training delivery strategies, including classroom and web-based 
training, may be utilized. Training may include establishment and 
maintenance of effective labor management forums.
    Emergency Employee Accountability ($2.8 million): This contract 
effort will develop an enterprise-wide personnel accountability system 
(PAS) to allow communications with and accounting for VA employees 
during a natural disaster, act of terrorism or other emergency. This 
initiative will improve VA ability to provide continuity of benefits 
and Veterans services as well as to serve the community in areas such 
as health care, in compliance with VA's fourth mission to ``Increase VA 
Capability to Support the Nation in Time of Need.'' PAS will provide 
the capability for VA to alert andnotify employees and contractors by 
name and obtain responses as to their safety and ability to work during 
and immediately after declaration of the emergency.
    Office of Administration ($6.2 million): The Office of 
Administration (OA) serves as the VA's hub for all building and 
facility related services for the VACO campus, comprised of eleven 
Washington area office buildings. On-going contract funds are required 
to support a clean, safe, attractive and accessible environment. 
Contract funding is requested to support the VACO Health Unit and 
Transit Benefits Program for employees. Funds will also be used to 
support the operations of OA's leasing and space functions, simplified 
acquisitions, transportation and labor services, and audio/visual and 
media services needs.
    Strategic Operations ($7.4 million): The Strategic Management Group 
provides effective management and oversight over the Department's Human 
Capital Improvement Plan initiatives. This contract funds 
administrative support for the establishment of a program review, 
development of program milestones, resource allocation, and for 
monitoring milestone progress. Contract activities include overall 
coordination and management of VA transformation and HCIP initiatives, 
assistance with the management of change and ongoing support of a 
project management office (PMO) support organization and staff.

    Question 4. The fiscal year 2012 budget request for the Office of 
Human Resources and Administration shows an increase of $288,000 or 
136% over fiscal year 2010 for printing and reproduction.
    A. What accounts for that 136% increase in printing costs from 
fiscal year 2010?
    Response. The fiscal year 2012 budget request includes printing 
requirements that were not made during FY 2010 due to delays in 
employee relocation for the Lafayette Building renovation. HR&A is 
responsible for several administrative functions related to the VACO 
campus including printing and distributing customer service guides, 
Occupancy Emergency Response Guides, and Emergency Evacuation 
Procedures to all VACO campus employees. The FY 2012 printing costs 
will include publication of guides to employees in new VA spaces. The 
requested increase will also cover the printing of several new HR&A 
publications listed in response 4B.
    B. Please provide an itemized list of how these funds will be 
expended.
    Response. The increase request for FY 2012 printing funds is 
attributed to printing the following materials:

     Customer Service Guide, Occupancy Emergency Response 
Guide, Emergency Evacuation Procedures.
     Strategic Human Capital Plan. This Report is to be shared 
with VA senior leader and serves as a ``roadmap'' for the 
accomplishment of VA Strategic goals, objectives, and initiatives using 
our human capital resources.
     Human Capital Management Report (jointly with the Office 
of Oversight & Effectiveness). This Report has a similar audience to 
the above. The Report indicates on an annual basis what VA was (or was 
not) able to accomplish using their human capital resources.
     Knowledge Management (KM) User Guide and Overview. These 
two documents (the second being two-side laminated) will be used to 
educate our H.R. professional community and others on what Knowledge 
Management is and how to use the new KM program.
     Workforce Planning Fact Sheet. This two-sided laminated 
document will serve a similar role, educating VA workforce planners on 
the Department's new corporate-wide Workforce Planning Program.

    Question 5. The fiscal year 2011 budget request included $3 million 
for a ``Health and Wellness initiative,'' which would fund a contract 
to an outside vendor. The ``Health and Wellness initiative'' was again 
mentioned in the FY 2012 budget under the Human Capital Investment 
Plan.
    A. How much has been budgeted for FY 2012 for continuation of the 
``Health and Wellness initiative?''
    Response. In FY 2012, $3.04 million has been budgeted for the 
continuation of this initiative.
    B. How much of the $3 million was obligated to an outside vendor to 
support the initiative? Who was the outside vendor and how does VA 
evaluate their job performance?
    Response. In FY 2011, $2.7 million was obligated to Federal 
Occupational Health (FOH) via Inter-Agency Agreement with the 
Department of Health and Human Services. Performance is measured 
through:

          i. Employee Participation--The percentage of VA employees who 
        sign up/register for the program and complete an online Health 
        Risk Assessment (HRA). The Web site is designed and maintained 
        by the vendor (FOH) and usage rates, drop off rates, etc. are 
        monitored monthly through Executive Summary Reports. This 
        measure provides quantitative data for the number and type of 
        recognized health risk behaviors in VA. This data allows VA to 
        focus on these behaviors and address them. The database also 
        provides us with the demographic areas where high risk health 
        behaviors exist and provides an overall ``snapshot'' of the 
        state of wellness of VA employees.
          ii. Feedback Surveys--Volunteer feedback surveys will be 
        available through the Web site. Surveys will contain questions 
        on all program areas and results will be used to identify 
        program strengths and weaknesses to improve upon. The results 
        of this data will be both qualitative and anecdotal, allowing 
        for more detailed feedback on areas for program improvement.

    a. Using the performance metrics outlined by VA last year in 
response to Senator Burr's questions for the record in connection with 
the February 2010 budget hearing, how effective has this program been 
in ``promoting healthier employees?''
    Response. The program is still in its ``Baseline Year.'' Only 
quantitative data on levels of utilization and participation have been 
collected. Program effectiveness measures will be reviewed at six 
months and at the end of the fiscal year to assess for program 
modifications to better meet employee needs. The official VA-wide 
program launch took place September 23, 2010. As of March 3, 2011, 6.5 
percent of VA employees had signed up and completed an HRA. Program 
effectiveness results will also be identified with the Employee 
Feedback Survey which is scheduled for dissemination at approximately 
the six-month point of the program (April 2011) and will be available 
continuously so employees may provide feedback at any time.
    b. Please outline the number of personal health coaches and active 
program coordinators, how they are chosen, and how their performance is 
measured.
    Response. There are 120 Lifestyle Coaches. Coaches were selected 
after completing the Healthy Lifestyle Coach requirements (Bachelors 
degree or higher in health promotion, health education background, 
counseling or other health related field and at least one year of 
experience in coaching). Coaches go through initial training and then 
will have ongoing evaluation and training. Measurement of FOH coach 
utilization and goals set by the employee will be ongoing. Employee 
health risk assessments will be reviewed by the coaches and then 
discussed with the employee to identify significant changes that merit 
tailoring of program elements to meet their needs.
    There are 330 Local Wellness Representatives who serve as program 
coordinators. This position is a voluntary and collateral position 
within the VA; representatives volunteer for this position in addition 
to their regular duties. They must have an overall interest in health 
and wellness promotion and be committed to serving as the liaison 
between the Health and Wellness Team, who oversee the VA-wide wellness 
program, and the on-site employee. The most direct measure for Wellness 
Representatives' performance is the overall participation rate at their 
respective sites.
Office of Policy and Planning
    Question 1. For fiscal year 2012, the Office of Policy and Planning 
is requesting over $20.7 million to support 125 employees. This would 
be an 87% increase in staffing since fiscal year 2010, a 21% increase 
over fiscal year 2011 staffing levels, and a 127% increase over fiscal 
year 2008 staffing levels.
    Response. For clarification, the Office of Policy and Planning 
(OPP) is requesting a total of 105 full time equivalent (FTE) ($17.6 
million) in the fiscal year (FY) 2012 budget authority, an increase of 
2 FTE over the FY 2011 request and 12 FTE over the FY 2010 request. The 
additional 20 FTE ($3.1 million) would be assigned to the Enterprise 
Program Management Office (ePMO). The ePMO was attached to OPP in late 
2010, after the FY 2011 budget submission, as a pilot program. It is 
responsible for developing Department-wide program management 
standards/doctrine; supporting the execution of the Department's $2.5 
billion portfolio of the 16 major initiatives, and assisting the 
Department's 20 supporting initiatives. The ePMO brings program 
management capabilities to large scale programs; is helping VA develop 
a program management culture; and will facilitate the successful 
development of future programs throughout the Department. In the last 
month alone, the ePMO has led a concentrated effort that has resulted 
in the awarding of $63.3 million in contracts and the preparation of 
$104.5 million of actionable contract packages in support of 16 major 
initiatives (see list of initiatives following response to question 
3D). Since the ePMO provides Department-wide services, the operating 
expenses of the ePMO will be paid via reimbursements from the Veterans 
Benefit Administration (VBA), the Veterans Health Administration (VHA), 
and the Office of Information and Technology (OIT) in FY 2011 and FY 
2012. The ePMO currently consists of a small cadre of six FTE and 
contract support. As the ePMO is proving to be successful in helping 
the Department to develop more effective program management 
capabilities, it is anticipated that the ePMO will be incorporated into 
OPP's budget authority request for FY 2013, subject to the approval of 
the Department's leadership.
    A. What measurable performance outcomes would suggest whether the 
previous staffing increases have been effective?
    Response. Since 2009, staffing increases have allowed OPP to 
establish the Office of Corporate Analysis and Evaluation (CA&E) and 
the Transformation and Innovation Service (TIS). We have also dedicated 
additional resources to the National Center for Veterans Analysis and 
Statistics (NCVAS) and the VA/DOD Collaboration Service. As a result of 
these additional resources, OPP has been able to improve outcomes to 
Veterans during FY 2010 and FY 2011 in support of the four key 
integrated strategies articulated in the VA Strategic Plan.
    Enhance our understanding of Veterans' and their families' 
expectations by collecting and analyzing client satisfaction data and 
other key inputs.

     Completed the National Survey of Veterans, a comprehensive 
nationwide survey of Veterans, active duty servicemembers, activated 
National Guard and Reserve members and family members and survivors. 
Data collected through the National Survey enables VA to compare 
characteristics of Veterans who use VA benefits and services with those 
of Veterans who do not; and study VA's role in the delivery of all 
benefits and services Veterans receive.
     Established VA data governance policy and processes to 
ensure VA enterprise data and information are available, current, 
reliable, readily accessible, and useful. Developed and implemented 
business intelligence capabilities and tools to transform data into 
information to support data-driven planning, analysis, and 
decisionmaking activities.

    Anticipate and proactively prepare for the needs of Veterans, their 
families, and our employees.

     Improved VA policy toward Gulf War Veterans by advocating 
for the implementation of recommendations made by the Advisory 
Committee on Gulf War Veterans. Produced a comprehensive annual report 
on the use of selected VA benefits and services by pre-9/11 Gulf War 
Era Veterans. The recommendations included presumptive criteria for a 
number of serious illnesses for which Veterans will now be eligible to 
receive treatment from VA.
     Completed the Program Evaluation of VA's Mental Health 
Program. This study provided VA with information about the services it 
provides, the impact on Veterans, how VA compares to the private 
sector, patient outcomes, and costs. Study findings and recommendations 
are used to refine and improve VA services by suggesting policy and 
operating changes.

    Create and maintain an effective, integrated Department-wide 
management capability to make data-driven decisions, allocate 
resources, and manage results.

     Began the implementation of planning, programming, 
budgeting, and evaluation (PPBE) capabilities to implement multi-year 
strategic resource allocation system across the Department and 
independent analysis to inform senior level decisionmaking on resource 
options. CA&E is an independent body dedicated to aligning VA resource 
allocations with investments that best serve our Veterans, their 
families, dependents, and survivors.
     Implemented the new strategic management process for VA. 
This process uses strategy to drive the budget and performance plans, 
and aligns the execution of VA strategy with performance management and 
organizational and individual accountability in an iterative way. This 
process centers on implementing the strategic goals, integrated 
objectives, and integrated strategies throughout VA.
     Ensured the success of Departmental transformation 
initiatives via collaboration, oversight, and monitoring of the $2.5 
billion portfolio of 16 major transformation initiatives and 20 
supporting initiatives. This included assisting in the development of 
operating plans, intensive mid-year reviews, and problem solving 
sessions with the 16 major initiatives that provided independent 
assessment of progress, identified barriers to success, helped define 
solutions, and elevated issues to senior leadership, as required.

    Create a collaborative, knowledge-sharing culture across VA and 
with DOD and other partners to support our ability to be people-
centric, results-driven, and forward-looking at all times.

     Contributed to transforming VA/DOD Collaboration by 
coordinating the development and implementation of joint programs such 
as the expansion of the virtual lifetime electronic record (VLER) 
pilots; the expansion of the integrated disability evaluation system 
(IDES) pilot to worldwide deployment; the development of the integrated 
mental health strategy (IMHS) and its 28 joint strategic actions; the 
increased access of servicemembers to VA benefits and service 
information through e-Benefits; the development of joint policy for the 
implementation of separation health assessments for all servicemembers; 
and significant improvements to the transition assistance program 
(TAP).

    Additionally, OPP continued to provide ongoing services and 
capabilities to the VA and to Veterans that included the following 
outcomes:

     Provided statistical and geospatial analysis to support 
recurring and ad-hoc reporting. Examples of these statistical products 
include the Geographical Distribution of VA Expenditures Report, the 
Unemployment Rate of Veterans Report: 2000 to 2009, the Labor Force 
Participation Rates of Veterans Report: 2000 to 2009, The VA 
Information Pocket Guide; the Gulf War Era Veterans: pre-9/11 Report, 
and the VA/DOD Disability Evaluation System Trend Analysis.
     Provided actuarial services to the Department on an 
ongoing basis. FY 2010 efforts included development of the VA 
compensation and pension liability model.
     Updated VA's official estimates and projections of the 
Veteran population by State, county and congressional district from 
2009 to 2039. Veteran population estimates are projected with 
characteristics such as: age, gender, period of service, race, 
ethnicity, rank (officer/enlisted), and branch of service.

    Conducted a nationwide management analysis/business process 
reengineering study of sanitation operations (8,831 FTE) and biomedical 
engineering (990 FTE) services across VHA and monitored the 
implementation of the recently reengineered plant operations and 
grounds maintenance (7,269 FTE) functions.
    B. What indicators would suggest whether additional staffing 
increases are warranted?
    Response. Despite the outcomes described above, additional 
capabilities are needed in FY 2012. The nine FTE within CA&E are not 
enough to implement a Departmental-wide programmatic alignment of the 
VA's $132 billion budget, conduct independent assessments of resource 
requirements needed to meet planned Veteran outcomes, and fully 
integrate PPBE across a 300,000 person organization with three distinct 
administrations (VBA, VHA, and NCA). Additional resources are also 
required to fully engage with DOD and the military services in the 
growing number of activities required to ensure effective transition 
from active duty to Veteran status. Finally, there is a recognized gap 
in the strategic planning ability of the VA to conduct long-term policy 
analysis and consider alternative futures that will impact Veterans and 
the Department in the long-term.
    The additional 12 FTE to bring the budget authority FTE to 105 in 
FY 2012 are requested to meet the emerging requirements identified 
above. First, to fully integrate and establish the PPBE methodology in 
the Department, it is necessary to expand the CA&E office from nine to 
13 personnel. CA&E is still an exceptionally lean, and efficient, 
operation in relation to comparable governmental agencies. The desired 
CA&E staffing of 13 would provide strategic resource management and 
independent analysis and oversight of a program budget in excess of 
$132 billion and a workforce in excess of 300,000. By comparison, the 
Office of Program Analysis and Evaluation (PA&E) at the Department of 
the Army is staffed with approximately 100 personnel and supports a 
similar sized program/budget of $149 billion in FY 2012. The VA/DOD 
Collaboration Service is expanding from 13 to 16 personnel to address 
the growing number of issues associated with VA/DOD collaboration 
including IDES, VLER, electronic health records, IMHS, TAP, etc. 
Finally, we are establishing a new capability within the Office of 
Policy to conduct long-term policy analysis and alternative futures 
development in coordination with DOD and other Federal agencies.
    C. Please list the specific positions that would be added to the 
Office of Policy and Planning during fiscal year 2012 with this level 
of funding and the expected pay-grades for those positions.
    Response. Most of the additional 12 FTE requested for FY 2012 will 
be management analyst grades 12/13/14. We will also hire statisticians 
and operational research personnel at the 13/14 level.
    D. Please explain the outcomes or achievements that are expected to 
be attributable to these additional employees.
    Response. As noted, the additional FTE are requested for 2012 to 
enhance capabilities primarily in three areas:

     The Office of Corporate Analysis and Evaluation will 
continue implementation of a Departmental-wide strategic resource 
management system to help inform VA leadership with analysis and 
options for future funding of Veterans needs. CA&E provides the 
Secretary, VA and senior leadership with independent and objective 
analysis of resource requirements and options for funding Veterans 
needs across the spectrum of health care, benefits, and memorial 
services. Through independent analysis and evaluation, CA&E provides an 
added level management insight on the effectiveness and efficiency of 
VA programs and budgets and measurable impact to the Veteran.
     The Office of VA/DOD Collaboration will expand its 
development and monitoring of joint policies and programs such as the 
expansion of the VLER pilots; the expansion of the IDES pilot to 
worldwide deployment; the development of the IMHS and its 28 joint 
strategic actions; the increased access of servicemembers to VA 
benefits and service information through e-Benefits; the development of 
joint policy for the implementation of separation health assessments 
for all servicemembers; and significant improvements to TAP. These 
activities will protect the equity of Veterans as they transition from 
servicemembers; producing better outcomes in health care delivery and 
benefit service for Veterans, servicemembers, military retirees, and 
eligible dependents.
     Finally, we are establishing a new capability within the 
Office of Policy to conduct long-term policy analysis and alternative 
futures development in coordination with DOD and other Federal 
agencies. It will provide policy analysis capability to a evaluate 
range of future policy issues and requirements, i.e. policy challenges 
due to population trends, changing demographics and implications to VA 
infrastructure and capabilities such as the impact of health care 
reform on Veterans, and implementation of Caregivers Legislation.

    Question 2. The fiscal year 2012 budget request for the Office of 
Policy and Planning shows an increase of $395,000 for travel over the 
amount ($112,000) expended in fiscal year 2010 for travel.
    Response. OPP is requesting $300,000 in travel budget authority for 
FY 2012. OPP only expended $110,000 in travel during FY 2010 because 
there was there were very few senior leaders assigned to the office 
during much of the year. The Assistant Secretary, for example, was not 
confirmed until March 2010 and the Principal Deputy Assistant Secretary 
was not appointed until September 2010. The Executive Director for CA&E 
and the Deputy Assistant Secretary for Policy were not appointed until 
the fall of 2010. The increased travel funding is also requested to 
support the additional functions and staff assigned to OPP, to include 
travel to support VA/DOD activities, PPBE functions, and operational 
oversight of the transformation initiatives.
    The remaining requests for $207,000 in travel funds for FY 2012 are 
from the ePMO ($120,000) and the VA Innovation Initiative (VAi2) 
($87,000), both of which are paid via reimbursing agreements by VBA, 
VHA, and OI&T. The ePMO, which supports program management activities 
across the Department, is involved with Major Initiatives across the 
country. VAi2 is involved with working with the private sector 
entrepreneurs, academia, and internal VA employees to identify and 
prototype cutting edge solutions to assist in solving VA's most 
challenging issues.
    A. What metrics are used to determine which staff needs to travel?
    Response. Travel is approved at the Deputy Assistant Secretary 
level for mission essential requirements. Senior executive service 
employees' travel is approved by the Assistant Secretary. These 
decisionmakers approve travel when it supports:

     Field operations
     Technical training required for mission essential skills 
development
     Planning and policy implementation
     Management oversight to include on-going assessments of 
VLER pilot expansion, IDES pilot and deployment sites, IMHS 
development, and major initiatives development.

    B. What options (such as video conference, webinars, or local 
conferences) were explored to reduce the costs to the taxpayer?
    Response. Whenever possible, we will use technology (video 
conference, and webinars) to reduce the cost of our travel. For 
example, most recently, the ePMO used extensive video teleconferencing 
over a three week period to synchronize contracting activities between 
the VA acquisition centers in New Jersey, Texas, and Maryland with 
activities here in Washington.

    Question 3. According to the fiscal year 2012 budget request, the 
Office of Policy and Planning now expects to spend $4.5 million more on 
Other Services than is estimated in the fiscal year 2011 budget. For 
fiscal year 2012, the Office of Policy and Planning is requesting $21.4 
million for Other Services, which would be a 27% increase over the 
amount that the office now plans to spend during fiscal year 2011 and 
94% more than this office originally requested for fiscal year 2011.
    A. Please provide a specific itemized list of how these funds would 
be spent during fiscal year 2011 and fiscal year 2012. To the extent 
any of these funds will be spent on contracts, please explain the 
nature of the contract and the expected outcomes.
    Response. The FY 2012 budget authority request for OPP is only 
$10.6 million for ``Other Services,'' which is actually a decrease of 
approximately $500,000 from our 2011 request. The remaining $10.8 
million is being requested to support the ePMO ($10.1 million) and VAi2 
($0.7 million), which will be funded via reimbursements from VBA, VHA, 
and OI&T.
    B. What factors account for the nearly $6 million increase during 
fiscal year 2011?
    Response. Since OPP plans to actually spend less in FY 2011 than 
originally requested, the increase in spending is fully reflective of 
the additional responsibilities assigned to the ePMO and VAi2.
    C. How was that $6 million originally intended to be spent?
    Response. VBA, VHA and OIT intended to spend the $6 million on 
transformation initiatives.
    D. What factors account for the over $4.5 million increase between 
fiscal year 2011 and 2012?
    Response. This increase is due to the additional responsibilities 
assigned to the ePMO and VAi2. The ePMO will develop project management 
standards, methodologies and processes to govern the management of the 
major transformational initiatives in VA; share best practices; help 
major initiative teams to define requirements and get the resources 
(people, money, contracts, and space) they require to effectively 
execute; review operating plans to determine whether the proposed 
resources will achieve the intended outcomes; and identity 
opportunities for re-engineering VA process to institutionalize change 
and improve VA's long term capacity to execute large cross cutting 
programs. This activities are all directed at improving the quality and 
accessibility of health care, benefits, and memorial services for 
Veterans while optimizing value. VAi2 is responsible for using joint 
public-private sector collaboration in order to improve health care, 
benefits and memorial services for Veterans.

  16 Major Initiatives
         1  Eliminate Veteran homelessness.
         2  Enable 21st century benefits delivery and services.
         3  Automate GI Bill benefits.
         4  Create Virtual Lifetime Electronic Records.
         5  Improve Veterans' mental health.
         6  Build VRM capability to enable convenient, seamless 
        interactions.
         7  Design a Veteran-centric health care model to help Veterans 
        navigate the health care delivery system and receive 
        coordinated care.
         8  Enhance the Veteran experience and access to health care.
         9  Ensure preparedness to meet emergent national needs.
        10  Develop capabilities and enabling systems to drive 
        performance and outcomes.
        11  Establish strong VA management infrastructure and 
        integrated operating model.
        12  Transform human capital management.
        13  Perform research and development to enhance the long-term 
        health and well-being of Veterans.
        14  Optimize the utilization of VA's Capital Portfolio by 
        implementing and executing the Strategic Capital Investment 
        Planning (SCIP) process.
        15  Health Care Efficiency: Improve the quality of health care 
        while reducing cost.
        16  Transform health care delivery through health informatics.
Office of Operations, Security, and Preparedness
    Question 1. For fiscal year 2012, the Office of Operations, 
Security, and Preparedness requests $4.4 million for Other Services. 
Please provide an itemized list of how these funds would be spent. To 
the extent any of these funds will be spent on contracts, please 
explain the nature of the contract and the expected outcomes.
    Response. In fiscal year 2012, The Office of Operations, Security, 
and Preparedness is requesting $4.4 million for contract support for 
the Department of Homeland Security (DHS) Guards contract at VACO for 
the security of our employees in the work place ($2.8 million), Program 
Support for the Homeland Security Presidential Directive 12 (HSPD-12) 
Program Office ($1.0 million), Funding for the VA Continuity of 
Government (COG) site ($0.25 million), and Maintenance and Support 
Contracts (access control systems, security cameras etc.) ($35 
million).
    The DHS Guards contract helps to ensure that VACO employees, 
veterans, and visitors have a safe and secure workspace. Additionally, 
in a crisis situation the Federal Protective Service uniformed officers 
provide emergency response force. The program support for the HSPD-12 
Program Office is necessary to assist in the establishment and 
maintenance of the Agency-wide HSPD-12 Program. The COG site allows VA 
senior leadership to have a space to continue to function in the event 
of a crisis.

    Question 2. For fiscal year 2012, the Office of Operations, 
Security, and Preparedness requests $13.7 million for 107 employees. 
This would amount to an 84% increase in staffing since fiscal year 2008 
and a 41% increase since fiscal year 2010.
    A. What measurable performance outcomes would suggest whether the 
previous staffing increases have been effective?
    Response. OSP's mission has significantly increased in scope since 
fiscal year 2008. During fiscal year 2010 the Office took on 
responsibility for the Department's Personnel Security and Suitability 
Program as well as the operation of the VACO Personal Identity 
Verification (PIV) badging office (11 FTE). The Office of Emergency 
Management (OEM) increased staffing in mandated programs in Exercise, 
Test and Evaluation and Planning and National Security (7 FTE). The 
Office of Security and Law Enforcement (OS&LE) increased staffing to 
provide more Oversight of field activity, VA police units, and critical 
infrastructure protection planning activities (6 FTE). The Office of 
the Assistant Secretary identified a requirement for a Human Resources 
official (1 FTE).
    Going from fiscal year 2010 to fiscal year 2012, OSP is requesting 
an increase of 12 FTE. These are identified for the HSPD-12 Program 
Office (7 FTE), VA internally authorized in the fiscal year 2011 
President's Budget submission. The fiscal year 2012 President's Budget 
identifies an additional 5 FTE for the following functions; 1 each for 
the Director Personnel Security and Identity Management (PS&IM), 
Director for PSS, Director of the Integrated Operations Center (IOC), a 
Special Security Representative (SSR) for a remote site, and one FTE in 
the Assistant Secretary's office to support required functions such as 
a Privacy Officer, a FOIA support role, and Records Management 
functions.
    B. What indicators would suggest whether additional staffing 
increases are warranted?
    Response. OSP is the Executive Lead for the VA Major Initiative 
Preparedness. This required an SES incumbent to function as the 
Initiative Lead (position also is the Director of PS&IM). This 
initiative is in direct support of the Secretary's transformation of 
the VA into a 21st century organization.
    The VA Integrated Operations Center has evolved into a fusion 
center with representatives from 15 organizations that gather 
information from all sources, not just VA, who then analyze; generate 
predictions and recommendations for senior leadership. This allows VA 
to fully participate in the interagency arena in response to real time 
events.
    The Director of National Intelligence signed the Intelligence 
Community Directive (ICD) 705 (Effective May 26, 2010), which requires 
a Special Security Representative (SSR) for each operational Sensitive 
Compartmented Information Facility (SCIF). In FY 2012, VA will operate 
a VA Reconstitution Planning Site that contains a SCIF, thus requiring 
an additional SSR staff member.
    The Personal Security and Suitability Service (PSS) was established 
to standardize the method in which VA processes security and 
suitability requirements for the Department. The increased staff is to 
support additional training, oversight and audit functions that have 
not been fully operational.
    The Resource Management Office was established to ensure compliance 
of Financial Management, Human Resource Management and Administrative 
and Logistics Management, to ensure procedures, laws, regulations, and 
policies in the Office of Operations, Security and Preparedness.
Office of Public and Intergovernmental Affairs
    Question 1. For fiscal year 2012, the Office of Public and 
Intergovernmental Affairs requests $13.6 million for 93 employees. This 
would amount to a 35% increase in staffing since fiscal year 2010 and a 
48% increase in staffing since fiscal year 2008.
    A. What measurable performance outcomes would suggest whether the 
previous staffing increases have been effective?
    Response. New Media Team--VA's main Facebook page now has over 
100,000 subscribers who we reach on a daily basis--more than any other 
cabinet-level agency and among the top 10 of all Federal organizations 
(to include the White House and military services).

     Among Veterans who use Twitter, more get their information 
from VA than from any VSO or Veterans organization. With over 14,000 
Twitter followers, VA has more followers than IAVA, the VFW, and the 
American Legion combined.
     Nearly 34,000 people are now receiving information 
directly each day from one of 79 VA medical centers now on Facebook.
     Over 7,000 people are now receiving information directly 
each day from one of 43 VA medical centers now on Twitter.
     VA's 250 YouTube videos have been viewed over 463,000 
times.
     VA's 5,300 photos on Flickr have been viewed over 395,000 
times.

    OPIA established the Homeless Veterans Initiative Office to end 
homelessness in 5 years. The initiative began in 2009 with 131,000 
homeless Veterans. In 2011, that number has fallen to 75,000. One of 
the most innovative efforts has been to implement a new strategy to 
prevent and rapidly end homelessness for those at highest risk. We 
expected to award funding by July 2011 that will aid 10,000 Veteran 
families who have lost housing or those at serious risk to maintain 
housing. This effort will, for the first time, effectively reduce those 
Veterans at low income with a nationwide community based intervention.
    B. What indicators would suggest whether additional staffing 
increases are warranted?
    Response. The new employees will be supporting the Office of Tribal 
Government Relations; Paralympic Program Office; Homeless Veterans 
Initiatives and Outreach Program offices.

    Question 2. For fiscal year 2012, the Office of Public and 
Intergovernmental Affairs requests $100,000 for a staff assistant to 
``coordinate schedules and write speeches/correspondence.''
    A. Please explain how adding a staff assistant to write speeches 
will help improve the lives of veterans or their families.
    Response. VA is charged with informing Veterans, dependents, and 
survivors of the benefits and services to which they may be eligible. 
The Office of Public and Intergovernmental Affairs (OPIA) builds 
confidence in VA and its readiness to serve America's Veterans of all 
generations. OPIA accomplishes this by developing, maintaining and 
communicating the Department's message through media relations and 
public, intergovernmental and Veteran engagement to empower Veterans 
and their families.
    The Staff Assistant to the Assistant Secretary will coordinate 
schedules and write speeches/correspondences for the Assistant 
Secretary and senior level principals. As a representative of the 
Secretary and of the President, the Assistant Secretary is responsible 
for conducting outreach and communications with Veterans, dependents, 
survivors, and stakeholders throughout the country. This results in a 
highly complex schedule with events, meetings and speaking engagements 
throughout the country with a diverse set of audiences. OPIA requires a 
staff member to manage the travel and scheduling logistics for the 
Assistant Secretary and, at times, travel with the Assistant Secretary 
as an aide and a representative of VA. Further, OPIA requires a staff 
member who can ensure that the messages from the Assistant Secretary, 
through speeches and presentations, are coordinated and in line with 
other key outreach and strategic communications efforts from the 
Department. It is imperative that OPIA be staffed appropriately to 
ensure that Veterans and their families receive consistent and 
regularly benefit information from the Department.
    The Staff Assistant will also be writing responses to inquiries 
from the White House, Congressional inquiries, Veterans and family 
members of veterans which we receive on a daily basis. This will also 
include all the telephone inquiries we receive. The Assistant Secretary 
receives on average 25-30 requests from Veterans daily.
    B. Please provide a list of the type of engagements for which 
speeches would be written.
    Response. The Staff Assistant coordinates messaging on speeches for 
VA principals which include all Assistant Secretaries. In 2010 alone, 
the Assistant Secretary for Public and Intergovernmental Affairs 
received at least 312 requests for speaking engagements (regretted 246, 
accepted 66). VA principals such as the Assistant Secretary for Public 
and Intergovernmental Affairs speak at events for women groups, 
military branches, veteran service organizations, VA offices and 
administrations, healthcare specialists, the legal community, Federal 
and state agencies, universities, private corporations, and non-profit 
assisting Veterans and servicemembers.

    Question 3. In the fiscal year 2012 budget request, the Office of 
Public and Intergovernmental Affairs requests $800,000 and 5 FTE to 
enhance VA's partnership with Tribal Governments. The Office of Tribal 
Government Relations is in the process of being stood up at this time. 
In correspondence between the Committee on Veterans' Affairs and the 
Office of Congressional and Legislative Affairs, VA justified the new 
office by stating that employees in the new office will do the 
following:

        The new employees will serve as the regional Office of Tribal 
        Government Relations representatives responsible for developing 
        ongoing positive collaborative relationships and partnerships 
        with tribal officials, the Veterans Benefits Administration, 
        the Veterans Health Administration and National Cemetery 
        Administration and other key partners in assisting with 
        facilitating policy and program consultation initiatives, 
        communication plans, program promotion and access to health 
        care services, benefits and funding or special project 
        opportunities offered by the VA. The employees will be 
        responsible for developing annual work plans and providing 
        quarterly and annual accomplishment reports to both VA 
        leadership and the tribes within their regional service area. 
        The Director and employees will establish a five year strategic 
        plan for the office that aligns with the Departmental strategic 
        plan with meaningful input from the tribes from each region.

    A. VA has had a long-standing relationship with the Indian Health 
Service (IHS), which required coordination with many Indian tribes 
throughout the United States. Who was previously in charge of forging 
those relationships between VA, IHS, and Indian tribes?
    Response. There was previously no lead office designated within VA 
to work with tribal governments on cross-cutting issues involving all 
three Administrations. Relationships were formed on an ad-hoc basis 
within the programs, with tribal governments, but nothing was formally 
dedicated to be the primary point of contact interfacing with tribal 
governments on behalf of the Secretary.
    B. Please explain the rationale used to determine whether or not to 
stand up a new administrative office within VA to strengthen tribal 
government relations versus increasing the ability of a standing office 
in VA to meet the same goals.
    Response. There are 565 federally recognized tribes located across 
the United States. The United States and Indian Tribes have a unique 
political relationship that is distinct from any other ethnic group or 
governmental entity. It was determined that if the office was housed 
within a VA Administration, it would not reach across all programs and 
services offered by VA that affect Indian Tribes. Therefore, it would 
be best suited to be housed at the Departmental level. Additionally, 
given the high rates of military service amongst American Indian/Alaska 
Native tribal members, given the large number of federally recognized 
tribes, the complexity of issues, and the predominantly rural and far 
reaching geographic locations where most tribal governments are 
situated, the importance of tribal the tribal consultation process in 
informed decisionmaking, it was determined that sufficient workload 
existed to dedicate the office specifically to focus on the needs and 
concerns tribal governments have in accessing services, benefits and 
funding opportunities to serve the needs of American Indian/Alaska 
Native Veterans.

    Question 4. According to the fiscal year 2012 budget request, the 
Office of Advisory Committee Management is tasked with the 
responsibility of serving as VA's liaison with VA's 25 advisory 
committees and setting uniform procedures for the Committees. In fiscal 
year 2011 the office charged with overseeing all of VA's advisory 
committees had a budget of $249,000 and two associated FTE. There is 
apparently no budget request for funds or FTE in fiscal year 2012.
    A. Please provide the names and descriptions for all 25 official VA 
advisory committees and any other councils or committees under the 
auspices of VA.
    Response. Currently the VA has only 23 advisory committees. The 
following list of VA advisory committees includes 15 that have been 
established by statute (with an asterisk *) and 8 non-statutory panels 
designed to provide advice on selected VA programs and policies. The 
advisory committees listed below are arranged alphabetically according 
to key words [bold print] in their titles. Immediately following the 
list of committees are summaries of the Committees' objectives.

    *1) Advisory Committee on Cemeteries and Memorials
     2) Clinical Science Research and Development Service Cooperative 
Studies Scientific Evaluation Committee
    *3) Advisory Committee on Disability Compensation
    *4) Veterans' Advisory Committee on Education
    *5) Veterans' Advisory Committee on Environmental Hazards
    *6) Advisory Committee on Former Prisoners of War
     7) Genomic Medicine Program Advisory Committee
    *8) Geriatrics and Gerontology Advisory Committee
    *9) Research Advisory Committee on Gulf War Veterans' Illnesses
     10) Health Services Research and Development Service Merit Review 
Board
    *11) Advisory Committee on Homeless Veterans
     12) Joint Biomedical Laboratory Research and Development and 
Clinical Science Research and Development Services Scientific Merit 
Review Board
    *13) Advisory Committee on Minority Veterans
     14) National Research Advisory Council
    *15) Advisory Committee on Prosthetics and Special Disabilities 
Programs
    *16) Advisory Committee on the Readjustment of Veterans
    *17) Veterans' Advisory Committee on Rehabilitation
     18) Rehabilitation Research and Development Service Scientific 
Merit Review Board
     19) Veterans' Rural Health Advisory Committee
    *20) Special Medical Advisory Group
    *21) Advisory Committee on Structural Safety of Department of 
Veterans Affairs Facilities
     22) Department of Veterans Affairs Voluntary Service National 
Advisory Committee
    *23) Advisory Committee on Women Veterans
Advisory Committee on Cemeteries and Memorials (Statutory)
    To provide advice to the Secretary of Veterans Affairs on the 
administration of national cemeteries, the selection of cemetery sites, 
the erection of appropriate memorials, and the adequacy of Federal 
burial benefits.
Clinical Science Research and Development Service Cooperative Studies 
        Scientific Evaluation Committee
    To provide advice on VA cooperative studies, multi-site clinical 
research activities, and policies related to conducting and managing 
these efforts while ensuring that new and ongoing projects maintain 
high quality, are based upon scientific merit, and are efficiently and 
economically conducted.
Advisory Committee on Disability Compensation (Statutory)
    To provide advice to the Secretary of Veterans Affairs on 
establishing and supervising a schedule to conduct periodic reviews of 
the VA Schedule for Rating Disabilities (VASRD).
Veterans' Advisory Committee on Education (Statutory)
    To provide advice to the Secretary of Veterans Affairs on the 
administration of education and training programs for Veterans and 
Servicepersons, Reservists, and dependents of Veterans under Chapters 
30, 32, 35, and 36 of Title 38, and Chapter 1606 of Title 10, United 
States Code.
Veterans' Advisory Committee on Environmental Hazards (Statutory)
    To provide advice to the Secretary of Veterans Affairs on adverse 
health effects that may be associated with exposure to ionizing 
radiation, and to make recommendations on proposed standards and 
guidelines regarding VA benefit claims based upon exposure to ionizing 
radiation.
Advisory Committee on Former Prisoners of War (Statutory)
    To provide advice to the Secretary of Veterans Affairs on the 
administration of benefits for veterans who are former prisoners of 
war, and to assess the needs of such veterans in the areas of service-
connected compensation, health care, and rehabilitation.
Genomic Medicine Program Advisory Committee
    To provide advice on the scientific and ethical issues related to 
the establishment, development, and operation of a genomic medicine 
program within the Department of Veterans Affairs.
Geriatrics and Gerontology Advisory Committee (Statutory)
    To provide advice to the Secretary of Veterans Affairs on all 
matters pertaining to geriatrics and gerontology by assessing the 
capability of VA health care facilities to meet the medical, 
psychological, and social needs of older veterans , and by evaluating 
VA facilities designated as Geriatric Research, Education, and Clinical 
Centers.
Research Advisory Committee on Gulf War Veterans' Illnesses (Statutory)
    To provide advice to the Secretary of Veterans Affairs on proposed 
research studies, research plans, or research strategies relating to 
the health effects of military service in Southwest Asia during the 
Gulf War.
Health Services Research and Development Service Merit Review Board
    To provide advice on the fair and equitable selection of the most 
meritorious research projects for support by VA research funds. The 
ultimate objective of the Board is to ensure the high quality and 
mission relevance of VA's legislatively mandated research and 
development program. Board members advise on the scientific and 
technical merit, originality, feasibility, and mission relevance of 
individual research proposals. They also advise on the adequacy of 
protection of human and animal subjects.
Advisory Committee on Homeless Veterans (Statutory)
    To provide advice to the Secretary of Veterans Affairs on benefits 
and services provided to homeless veterans by the Department of 
Veterans Affairs.
Joint Biomedical Laboratory Research and Development and Clinical 
        Science Research and Development Services Scientific Merit 
        Review Board
    To provide advice on the scientific quality, budget, safety, and 
mission relevance of investigator-initiated research proposals 
submitted for VA merit review consideration. The proposals to be 
reviewed may address research questions within the general area of 
biomedical and behavioral research or clinical science research. The 
Board also advises VA research officials on program priorities and 
policies, as well as administration of VA's intramural program.
Advisory Committee on Minority Veterans (Statutory)
    To provide advice to the Secretary of Veterans Affairs on the 
administration of VA benefits for veterans who are minority group 
members in the areas of compensation, health care, rehabilitation, 
outreach, and other services.
National Research Advisory Council
    To provide advice to the Secretary of Veterans Affairs on research 
and development sponsored and/or conducted by the Veterans Health 
Administration, to include policies and programs of the Office of 
Research and Development.
Advisory Committee on Prosthetics and Special Disabilities Programs 
        (Statutory)
    To provide advice to the Secretary of Veterans Affairs on VA 
prosthetics programs and the rehabilitation research, development, and 
evaluation of prosthetics technology. The Committee also assesses VA 
programs that serve veterans with spinal cord injury, blindness or 
vision impairment, loss of or loss of use of extremities, deafness or 
hearing impairment, or other serious incapacities.
Advisory Committee on the Readjustment of Veterans (Statutory)
    To provide advice to the Secretary of Veterans Affairs on policies, 
organizational structures, and the provision and coordination of 
services to address veterans' post-war readjustment to civilian life, 
with particular emphasis on Post Traumatic Stress Disorder, alcoholism, 
other substance abuse, post-war employment, and family adjustment.
Veterans' Advisory Committee on Rehabilitation (Statutory)
    To provide advice to the Secretary of Veterans Affairs on the 
rehabilitation needs of disabled veterans and the administration of 
VA's rehabilitation programs.
Rehabilitation Research and Development Service Scientific Merit Review 
        Board
    To provide advice on the fair and equitable selection of the most 
meritorious research projects for support by VA research funds, and to 
provide advice for research program officials on program priorities and 
policies. The ultimate objectives of the Board are to ensure that the 
VA Rehabilitation Research and Development program promotes functional 
independence and improves the quality of life for impaired and disabled 
veterans.
Veterans' Rural Health Advisory Committee
    To provide advice to the Secretary of Veterans Affairs on health 
care issues affecting enrolled veterans residing in rural areas.
Special Medical Advisory Group (Statutory)
    To provide advice to the Secretary of Veterans Affairs and the 
Under Secretary for Health on matters relating to the care and 
treatment of veterans and other matters pertinent to the operations of 
the Veterans Health Administration (i.e., research, education, training 
of health manpower, and VA/DOD contingency planning).
Advisory Committee on Structural Safety of Department of Veterans 
        Affairs Facilities (Statutory)
    To provide advice to the Secretary of Veterans Affairs on 
structural safety in the construction and remodeling of VA facilities, 
and to recommend standards for use by VA in the construction and 
alteration of facilities.
Department of Veterans Affairs Voluntary Service National Advisory 
        Committee
    To provide advice to the Secretary of Veterans Affairs and the 
Under Secretary for Health on how to coordinate and promote volunteer 
activities within VA health care facilities.
Advisory Committee on Women Veterans (Statutory)
    To provide advice to the Secretary of Veterans Affairs on the needs 
of women veterans regarding health care, rehabilitation benefits, 
compensation, outreach, and other programs administered.

    B. Please explain which office will be serving as liaison to the VA 
advisory committees in fiscal year 2012.
    Response. In FY 2012, the Office of Congressional and Legislative 
Affairs will support the Office of Advisory Committee Management. The 
funding for the Office of Advisory Committee Management has been 
incorporated into OCLA's overall budget request. It was not 
specifically highlighted as a separate entity.
    C. In the last two years, how many recommendations or findings made 
by advisory committees have been implemented by the Secretary to change 
VA procedures or improve its delivery of care or benefits to veterans?
    Response. In the last two years VA advisory committees made 220 
recommendations. VA has implemented, or is in the process of 
implementing, 87% of them.
    D. Of the 25 advisory committees noted in the fiscal year 2012 
budget request, do any of them have a termination or sunset date other 
than those listed in the summary volume of the fiscal year 2012 budget 
request? If so, please list the end dates and whether the Committees 
have been dissolved.
    Response. VA Advisory Committees with termination or sunset dates 
are:

        Veterans' Advisory Committee on Education--December 31, 2013
        Advisory Committee on Homeless Veterans--December 30, 2011
        Advisory Committee on Minority Veterans--December 21, 2014

    E. What is the operational cost of these committees for fiscal year 
2012?
    Response. Estimated operational cost for VA's advisory committees 
for fiscal year 2012 is $6 million which includes personnel payments to 
non-Federal members (stipend), Federal members, non-member consultants, 
and Federal staff (salary of Federal staff(s) who provides support to 
the Committee); travel and per diem; and other costs (court reporter, 
conference space, etc.).
    Costs for VA's advisory committees have been controlled. Committees 
meet on an average of twice a year. Over the last two of years we have 
made several procedural and process changes designed to improve the 
management of VA's advisory committees, to include, where statutorily 
permissible, limiting membership and stipends and requiring an annual 
operations plan and annual assessment to enhance operations planning. 
Actual costs for the last three fiscal years are:

                  Actual Costs
        FY 08--$5,422,621
        FY 09--$5,870,115
        FY 10--$5,870,972
        FY 11--$5,925,000 (estimate)
Office of Congressional and Legislative Affairs
    Question 1. For fiscal year 2012, the Office of Congressional and 
Legislative Affairs requests $6.1 million for 52 employees. This would 
amount to a 44% increase in staff since fiscal year 2010 and a 58% 
increase since fiscal year 2009.
    A. What measurable performance outcomes would suggest whether the 
previous staffing increases have been effective?
    Response. OCLA has a critical role in keeping Congress informed of 
VA's work on behalf of Veterans as well as responding to Member and 
Committee inquiries on legislation, policy initiatives, on behalf of 
constituents, and many other areas. OCLA's efforts in providing Members 
of Congress with the information they require is people-intensive, and 
for a number of years OCLA was not staffed sufficiently to keep pace 
with Congress' increasing requests for information. OCLA's budget 
request is intended to put additional personnel toward meeting the 
needs of Congress.
    In October 2010, OCLA produced its Operating Plan which defined 
performance measures and metrics for the office for FY 2011-2013. These 
measures and metrics were created to improve OCLA's responsiveness to 
Congressional requests for information and set goals for the office 
that support VA's Strategic Plan. These measures and metrics will be 
the standard to measure OCLA's progress and are reviewed on a monthly, 
quarterly, and annual basis. OCLA also published a new Standing 
Operating Procedures (SOP) Manual following a comprehensive review of 
all of the office's internal processes. Since the implementation of the 
Operating Plan, and publication of the SOP, OCLA has improved its 
responsiveness to Congressional requests for information. As an 
example, OCLA has revitalized the questions for the record (QFR) 
process. OCLA assigned new program analysts to assist with implementing 
the new collaborative processes outlined in the SOP that streamlined 
the overall QFR process and turned an underachieving performance 
throughout FY 2010 into a process that is exceeding its targeted goal 
in FY 2011. In FY 2010, OCLA submitted 16% of the QFRs on time. Through 
the first five months of FY 2011 OCLA has submitted a 100% of the QFRs 
on time. OCLA supported 322 congressional briefings in FY 2010. Through 
the first five months of FY 2011, OCLA coordinated 173 briefings, which 
is a 60 percent increase over the same period last FY. The added 
briefings were a result of the greater depth and breadth on issues 
staffed by the additional congressional relations officers and 
congressional liaison officers. These new personnel have also 
contributed to ensuring OCLA improved its performance in submitting VA 
witness written testimony on time. In FY 2010, OCLA submitted only 60% 
of testimony on time. Through the first five months of FY 2011, OCLA 
has submitted 100% of testimony on time. VA is committed to providing 
Congress accurate and timely information and the increase in personnel 
are necessary to achieve that goal.
    B. What indicators would suggest whether additional staffing 
increases are warranted?
    Response. There are two main indicators that suggest increased 
staffing is required. OCLA monitors the feedback Members of Congress 
and Congressional staff provide on the timeliness and accuracy of the 
information VA provides to Congress. While OCLA has made significant 
improvement, there are still additional improvements to be made to 
decrease the time it takes to respond to requests for information. The 
other main indicator is OCLA's All Employee Survey results. These 
results indicate additional personnel are needed to balance workload 
within the office. The results of the survey indicated employees 
realize the importance of their jobs, but are impacted by the high 
volume of work and the very dynamic environment they operate in. These 
factors were considered in reorganizing OCLA's structure to provide 
greater depth and breadth on issues, adding positions to support the 
most over-worked areas, and rebalancing existing duties and 
responsibilities. OCLA requested additional funding and staff to 
accomplish these actions. However, in FY 2009 and FY 2010, OCLA was 
unable to achieve its authorized number of employees due to high 
employee turnover. In FY 2009, OCLA was authorized 38 FTEs, only 34 
were obligated. In FY 2010, OCLA was authorized 42 FTEs, and only 
obligated 36. As of March 2011, OCLA has increased the number of 
personnel to 43 and should be able to achieve our authorized strength 
of 46 employees before the end of the fiscal year. In FY 2012, OCLA 
requests additional funding to support three additional personnel, 
which includes the Office of Advisory Committee Management. As a result 
of the office's grade structure, FY 2012's requested funding would 
increase the office's overall FTE to 49 vice 52.
    C. Please provide a list of the specific positions that have been 
or will be added to the office since fiscal year 2009 and the pay-
grades for those positions.
    Response. In FY 2010, OCLA added four positions to its 
organizational structure.

        Congressional Relations Officer--GS-14
        Congressional Relations Officer--GS-14
        Congressional Liaison Officer--GS-13
        Congressional Liaison Officer--GS-13

    In FY 2011, OCLA will add four positions to its organizational 
structure.

        Director, Benefits Legislative Affairs--GS-15
        Program Analyst--GS-9
        Program Analyst--GS-9
        Congressional Liaison Assistant--GS-8

    In FY 2012, OCLA is requesting to add three positions to its 
organizational structure.

        Director, Health Legislative Affairs--GS-15
        VA Advisory Committee Management Officer--GS-14
        VA Advisory Committee Program Analyst--GS-11

    Question 2. The Office of Congressional and Legislative Affairs 
requested an 80% increase in travel over the same period.
    A. What metrics are used to determine which staff needs to travel?
    Response. OCLA personnel travel in support of Members of Congress 
and Congressional Staff. Staffs are primarily assigned to support 
Congressional travel by their respective portfolios. Every OCLA request 
for travel is approved at the deputy assistant secretary level. 
Requests for travel in support of organizational meetings/conferences 
or training are also approved at the deputy assistant secretary level 
to ensure a requirement exists for attendance and there is sufficient 
return to support the expenditure of travel funds. OCLA's travel budget 
also pays for Members of Congress and Congressional staff oversight 
travel.
    B. What options (such as video conference, webinars, or local 
conferences) were explored to reduce the costs to the taxpayer?
    Response. During October 2010, OCLA completed installation of video 
teleconferencing equipment that enables the office to participate in 
teleconferences vice traveling to the conference/meeting sites out of 
the Washington, DC area. OCLA will offer Congressional staff the option 
of conducting a video teleconference for meetings with out of town VA 
personnel versus having VA personnel travel to Washington, DC for the 
meeting. OCLA staff also participates in webinars when possible to 
reduce travel costs. OCLA has coordinated staff training with VA's 
Learning University utilizing conference facilities adjacent to VA 
headquarters on Vermont Avenue.
Office of Acquisition, Logistics, and Construction
    Question 1. For fiscal year 2012, the Office of Acquisition, 
Logistics, and Construction requests $36 million for Other Services, 
which includes funding for the President's Acquisition Improvement 
Initiative.
    A. Please provide an itemized list of how these funds would be 
spent. To the extent any of these funds will be spent on contracts, 
please explain the nature of the contract and the expected outcomes.
    Response. The table below shows the major contracts and expenses 
the Office of Acquisition, Logistics, and Construction plans during FY 
2012 in the Other Services account.


           General Operating Expense (GOE) Other Service Items

Acquisition Improvement Initiative......................     $23,854,000
Service Level Contracts for Hoteling....................      $2,700,000
National Institute of Building Standards (NIBS)               $2,931,000
 Contracts..............................................
NIBS Membership and Design Guide........................        $170,000
Seismic Maintenance Interagency Agreement...............         $61,000
Federal Facilities Council Contract.....................         $30,000
National Park Service Portal Interagency Agreement......         $20,000
Financial Service Center Service Level Agreement........        $500,000
Historical Preservation Contracts and Interagency               $824,000
 Agreements.............................................
Moving Cost Related to Regional Office Relocations......        $180,000
Training................................................        $132,000
Permanent Change of Station Moves.......................        $479,000
Repair of Furniture and Equipment.......................         $44,000
Strategic Planning Support..............................        $131,000
Maintenance and Repair Services.........................         $38,000
                                                         ---------------
Subtotal for GOE........................................     $32,094,000
                                                         ---------------

           Other Service Amounts Included Under Reimbursements

Other Service Costs for 140 FTE Reimbursed from Major
 Construction
Permanent Change of Station Moves.......................        $869,078
Training................................................         $70,000
Contracts--reimbursement prorated portion NIBS,               $1,771,922
 Historical, FFC, etc...................................
                                                         ---------------
Total for Major Construction Reimbursement..............      $2,711,000
                                                         ---------------

    Others Service Costs for 51 FTE Reimbursed from Medical Facility

Permanent Change of Station Moves.......................        $377,860
Training................................................         $25,500
Contracts--reimbursement prorated portion NIBS,                 $681,640
 Historical, FFC, etc...................................
                                                         ---------------
Total for Medical Facility Reimbursement................      $1,085,000
                                                         ---------------

          Other Service Costs for 6 FTE Reimbursed from Supply

Repair of Furniture & Equipment.........................          $1,000
Maintenance & Repair Services...........................          $1,000
Contracts--including prorated portion of FSC contract...        $131,000
Training................................................          $5,000
                                                         ---------------
Total for Supply Reimbursement..........................        $138,000
                                                         ---------------
Subtotal Reimbursements.................................      $3,934,000
                                                         ---------------
Grand Total.............................................     $36,028,000
                                                         ===============


    The information below provides details on funds that will be spent 
on contracts.

    Acquisition Improvement Initiative: Part of the President's 
Acquisition Improvement Initiative to increase the capacity and 
capability of the acquisition workforce. This funding will specifically 
support 1) improvements in the VA Acquisition Academy Training Model; 
2) enhancement of VA's program management culture; 3) the Warrior to 
Workforce (W2W) Program--which strives to develop and implement a 
formalized training program for wounded veterans to obtain the positive 
education requirement for entry into the GS-1102 Contracting Series and 
completion of the VAAA's Acquisition Internship School program and 
curriculum; 4) the acquisition intern program--which continues to 
implement a formalized and holistic training program to provide 
additional entry level contract specialists for VA and other Agencies. 
Contract Specialist Tuition Reimbursement--which supports the VA in 
developing its existing contracting workforce by providing $2.5M in 
funding toward tuition reimbursement.
    Contracts will specifically support the development and 
implementation of the required curriculum and training programs 
associated with aforementioned programs.
    Service Level Contracts for Hoteling: Provides temporary locations 
for three new regional offices as part of the implementation of phase 
II of the VAFM Transformation Initiative until GSA long term leases are 
put in place.
    Federal Facilities Council: Support facilities engineering related 
studies and identify best-practices.
    Financial Service Center Service Level Agreement: The Financial 
Service Center contract is a Service Level Agreement between Department 
of Veterans Affairs (VA) Financial Services Center (FSC) and the Office 
of Acquisition, Logistics and Construction (OALC). OALC reimburses FSC 
for services provided to OALC including construction accounting, credit 
card processing, payment services, customer support help desk services, 
payroll services, permanent change of station travel processing 
services, etc.
    National Institute of Building Standards (NIBS) Contracts/NIBS 
Membership and Design Guide: NIBS was authorized by the U.S. Congress 
in the Housing and Community Development Act of 1974, Public Law 93-383 
to address the need for an organization that could serve as an 
interface between government and the private sector. The Institute 
provides an authoritative source of advice for both the private and 
public sector of the economy with respect to the use of building 
science and technology.
    Seismic Maintenance Interagency Agreement: Seismic Maintenance 
Interagency Agreement (IAA): The agreement is between the U.S. 
Geological Survey (USGS) and VA, signed on April 20, 2009. It includes 
the installation of multi-channel systems for recording earthquake 
shaking at VA hospitals and to provide earthquake damage alerts. USGS 
will install multi-channel instruments in 27 buildings in a period of 
four (4) years. The final year of the IAA is 2012. To date, 13 hospital 
buildings were completed. Instrumentation of the remaining 14 hospitals 
will be completed in FY 2011 and FY 2012 The instruments and 
engineering support will provide specific information on potential 
damage to VA facilities within minutes.
    Historical Preservation Contracts and Interagency Agreements: 
Provide ``on-call'' historic preservation compliance assistance to 
medical centers and cemeteries. Work can include archaeological 
surveys, historic structure assessments, historic American building 
documentation, and consultation with consulting parties, drafting 
agreement documents, and assistance with curating artifacts.
    National Park Service Portal Interagency Agreement: VA supports the 
NPS Historic preservation portal which hosts the VA historic 
preservation checklist and provides key information on preservation 
laws and regulations to VA field personnel.
    Strategic Planning Support: OALC long range planning to align 
organizational goals to the Secretary's long range vision for the 
Department. Strategic planning support will also implement a process to 
track development, implementation, and completion of initiatives.
    B. What metrics will be used to gauge the effectiveness of the 
Acquisition Improvement Initiative?
    Response. The following are the metrics used to measure VA's 
acquisition processes. Execution of the acquisition improvement 
initiative is expected to have a positive impact on these measures.

           Metrics for VA Acquisition Improvement Initiatives
------------------------------------------------------------------------
  Balanced Scorecard Quadrant                    Measure
------------------------------------------------------------------------
Business Processes               Procurement Customer Satisfaction
------------------------------------------------------------------------
Financial                        Federal Procurement Data System
                                  Accuracy
------------------------------------------------------------------------
Customer Satisfaction            Procurement Savings
------------------------------------------------------------------------
Customer Satisfaction            Unauthorized Commitments
------------------------------------------------------------------------
Business Processes               FPDS Verification
------------------------------------------------------------------------
Business Processes               Procurement Action Lead Time (PALT)
------------------------------------------------------------------------
Business Processes               High Risk Contracting Reductions
------------------------------------------------------------------------
Learning and Growth              Socio-Economic Program Goal Performance
------------------------------------------------------------------------
Customer Satisfaction            Electronic Contract Management System
                                  (eCMS) Usage
------------------------------------------------------------------------
Business Processes               Contracting Competition
------------------------------------------------------------------------

                               education
    Question 1. In 2009, VA provided $356 million in emergency payments 
of education benefits to approximately 122,000 individuals. In 
connection with the February 2010 budget hearing, VA acknowledged that 
``[a]pproximately $120 million was issued to advance payment recipients 
who had not established their benefits eligibility for the fall 
enrollment period.'' According to a November 2010 report from the VA 
Office of Inspector General, ``the emergency payments resulted in an 
estimated loss of about $87 million in unrecoverable debts.''
    A: To date, how much of the $356 million has been recouped by VA?
    Response. As of March 5, 2011, VA has collected $259,411,399.
    B: To date, how much of the $356 million has been determined to be 
uncollectable and why?
    Response. As of March 10, 2011, none of these debts have been 
determined to be uncollectable. Any emergency payment debts that do not 
have a current re-payment plan have been referred to Treasury for 
offset from other Federal payments. Treasury can also refer these debts 
to third party collection agencies.

    Question 2. VA's fiscal year 2011 budget proposal requested funding 
for various contracts, including a contract with MITRE Corporation's 
Center for Enterprise Modernization, a contract for an Outcome and 
Customer Satisfaction Survey, a contract for Training Performance 
Support Systems, a contract for National Student Clearinghouse Match, 
and a contract for Education State Approving Agency Contract Review.
    A: Please provide an update on those contracts, including the 
amount of funds that have been expended and the results achieved.
    Response. The following FY 2011 funds have been expended during the 
continuing resolution.
1. MITRE Corporate Center for Enterprise Modernization
            Funds expended: $1.4 million.
    Results achieved: During FY 2011, MITRE has provided User 
Acceptance Testing (UAT) Support for four releases (3.0, 4.0, 4.1, and 
4.2) of the Post-9/11 GI Bill Long-Term Solution (LTS). MITRE developed 
test scripts and test cases for each release, which were used by 
Veteran Claims Examiners to successfully test the LTS. In addition to 
UAT Support, MITRE has provided strategic management support to 
Education Service to include strategy development and planning; 
Integrated Master Schedule planning; and organizational strategic 
support, analysis and recommendations.
2. Customer Satisfaction Survey
            Funds expended: $2.7 million.
    Results achieved: VBA's Benefits Assistance Service (BAS) leads the 
customer satisfaction survey effort for all VBA programs including 
education programs. Under this contract with J D Power and Associates 
(JDPA), the survey questionnaires have been finalized and are awaiting 
the selection files for the survey participants. BAS and JDPA are in 
the process of finalizing the data transfer agreement and developing 
the reporting site. JDPA is requesting the data files by the end of 
April for a May deployment of the surveys. The initial survey results 
are expected by September 2011.
3. State Approving Agency Contract Review
            Funds expended: No funds have been expended for this 
                    contract in FY 2011.
    Results achieved: This contract generated recommendations for 
greater efficiency in the State Approving Agency (SAAs) contract and 
contract processes. A thorough review and analysis were completed to 
ensure compliance with all laws and regulations. A contract deliverable 
made recommendations for funds distribution that take into account the 
differences amongst SAAs and would allow VA to consider factors not 
addressed in the current funding allocation methodology. The 
deliverable provided recommended improvements to current contracting 
processes. As VA is focused on implementing SAA-related changes 
resulting from Public Law111-377, recommendations from this contract 
have not been implemented at this time, and will be revisited at a 
later date.
4. National Student Clearinghouse Match
            Funds expended: VA anticipates expending $40,625 relating 
                    to this contract in FY 2011.
    Results achieved: Contractor is expected to provide student data 
reports that will show degree attainment characteristics for VA 
education beneficiaries and graduation rates compared to a randomly 
selected student population.
5. Training Performance Support Systems--TPSS
            Funds expended: To date, no funds have been expended for 
                    this contract in FY 2011. However, a task order 
                    package has been submitted for Lifecycle 
                    Maintenance and additional task orders may be 
                    submitted subject to training needs and funds 
                    availability for FY 2011.
    Results achieved: VA anticipates that the contractor will provide 
Lifecycle Maintenance and fulfill any additional training module 
requirements subject to training needs.
    B: Does the fiscal year 2012 budget proposal include any funding to 
continue these contracts? If so, please provide the amounts and 
expected achievements.
    Response. VA requested the following FY 2012 funds to fulfill the 
listed contracts:


1. MITRE Corporate Center for Enterprise Modernization
            Funds requested: $5.1 million.
    Expected achievements: VA anticipates that MITRE will continue to 
develop test scripts and test cases for each release as we look forward 
to the full automation and implementation of the LTS in 2012. MITRE 
will also continue to provide UAT support and strategic management 
support to Education Service.
2. Customer Satisfaction Survey
            Funds requested: $5 million.
    Expected achievements: JDPA is expected to provide similar services 
to the BAS during fiscal year 2012 and produce a survey that will 
convey customer satisfaction results to the Education Service.
3. State Approving Agency Contract Review
            Funds requested: No funds were requested for this contact 
                    for FY 2012.
    Expected achievements: VA does not anticipate extending this 
contract.
4. National Student Clearinghouse Match
            Funds requested: $53,000
    Expected achievements: Contractor is expected to provide student 
data reports that will show degree attainment characteristics for VA 
education beneficiaries and graduation rates compared to a randomly 
selected student population.
5. Training Performance Support Systems--TPSS
            Funds requested: $586,000
    Expected achievements: The contractor is expected to begin work on 
training modules for the Education Liaison Representative (ELR), 
Education Compliance Survey Specialist (ECSS), Equal Opportunity 
Compliance Surveys and State Approving Agency Contract Management. The 
contractor will continue to work on existing training modules for 
Veterans Claims Examiners and Education Case Managers, TIMS Clerks, and 
ELR/ECSS compliance surveys. These modules will be updated as part of a 
routine maintenance to incorporate new legislation, policy, and 
procedures.
    C: Does the fiscal year 2012 budget proposal include any funding to 
secure contract services to help process education claims?
    Response. VA's FY 2012 budget proposal does not include a request 
for funding to secure contract services to help process education 
claims.

    Question 3. VA's fiscal year 2011 budget proposal for the Education 
Service included $3.1 million for Supplies and Materials. VA indicated 
that $1.2 million of that amount would be spent on printer cartridges 
in connection with an initiative to provide printers for individual 
employees. Since then, VA has indicated that the printer initiative was 
canceled. How is that $1.2 million now expected to be spent?
    Response. This funding requirement is no longer applicable. Funds 
for the printer cartridges initiative were eliminated from VBA's 
budget.

    Question 4. According to VA's Web site, individuals with questions 
about education benefits may call VA's 1-888-GIBILL-1 phone number but 
they should ``[b]e advised this line only accepts calls from 7:00 AM-
7:00 PM central time Monday-Friday and you may experience long hold 
times.''
    A. Currently, how many employees are dedicated to answering calls 
to that telephone number?
    Response. There are currently 280 employees working in the 
Education Call Center (ECC) in Muskogee, Oklahoma. Of those 280 
employees, 140 are call agents permanently assigned to the ECC. An 
additional 45 employees are term appointments (expiration date is Sept. 
30, 2011) and 18 are temporary appointments (expiration date is Sept. 
30, 2011). Currently, 34 agents are temporarily detailed from the 
Muskogee National Call Center (NCC) to the ECC to assist with the high 
volume of calls. The ECC also has 32 Education Case Managers (dedicated 
5 hours/day to call handling) and 11 Senior Case Managers (handling 
call escalations) to assist with technical questions and call handling.
    B. Currently, what is the average ``hold time'' for an individual 
calling that telephone number?
    Response. The average ``hold time'' for fiscal year 2011 to date is 
four minutes and one second.
    C. For fiscal year 2012, what level of funding is requested for 
purposes of handling these telephone calls and how many employees will 
that level of funding support?
    Response. VA's FY 2012 budget submission identifies the overall 
staffing level for administration of the education programs. Funding 
levels for specific functions supporting education claims processing, 
such as managing the Education Call Center, are allocated during the 
budget execution year. We therefore do not have this information 
available.
    D. With the requested level of fiscal year 2012 funding, what is 
the expected hold time for callers?
    Response. VBA's current performance measures for call centers are 
based on abandoned and blocked call rates. To improve customer service, 
we are in the process of analyzing data and establishing goals to 
replace the abandoned call measures with measures for wait times. 
Analysis of the impact of workload and staffing fluctuations during 
peak enrollment periods on wait times is critical to establishing 
appropriate measures and improving customer service. At this time, we 
do not have sufficient data available to project expected hold time.

    Question 5. In connection with the February 2010 hearing on VA's 
fiscal year 2011 budget proposal, the Education Service indicated that 
it planned to expend $1.2 million during fiscal year 2011 on 
``[o]utreach pamphlets and letters.''
    A. How much has VA expended so far during fiscal year 2011 on 
outreach pamphlets and letters?
    Response. Approximately $55,000 has been expended in FY 2011 (Qtr 
1).
    B. How much is requested for this purpose in the fiscal year 2012 
budget proposal?
    Response. VA has requested approximately $1.9 million to fulfill 
all outreach efforts in FY 2012, which include the mailing of letters 
and pamphlets.
    C. What metrics are used to determine if these pamphlets and 
letters are effective?
    Response. There are currently no metrics that gauge the 
effectiveness of outreach materials; however, VBA's Benefits Assistance 
Service is conducting an outreach assessment. As part of this 
assessment, VBA intends to address metrics for this area.
    We do monitor usage of our Web site pages using Google Analytics to 
determine most visited Web sites. We also monitor usage of our 
Frequently Asked Questions and Facebook comments to evaluate what areas 
of information require clarification.
    In FY 2009, we enlisted MITRE assistance in conducting focus groups 
on communication to our stakeholders and made changes to our outreach 
strategy based on that information. MITRE will be conducting follow-up 
sessions with key stakeholders and Veterans to determine the 
effectiveness of our communications plan.
    D. In terms of those metrics, please explain the performance 
outcomes to date during fiscal year 2011.
    Response. See response to 5c.
                     veterans health administration
    Question 1. The President's Commission on Fiscal Responsibility and 
Reform's December 2010 report recommended that Federal agencies 
``reduce Federal travel, printing and vehicle budgets.'' 
(Recommendation 1.10.5) However, in the fiscal year 2012 budget request 
Appendix for Medical Services there is listed an increase of 8% or $6 
million for employee travel over the fiscal year 2010 actual level. 
Over the same period, there is listed an increase of 61% or $14 million 
for the ``transportation of things.''
    A. How did VHA take into account the President's commission's 
recommendation to reduce travel when formulating this budget?
    Response. The eight percent increase in travel is over a 2 year 
period from FY 2010 to FY 2012. While there is an increase in Employee 
Travel from FY 2010 through FY 2014, VHA took the President's 
commission's recommendation to reduce travel and directly applied it to 
the preparation of the 2012 President's Budget by limiting the amount 
of growth to only the inflationary rate per year from FY 2011 to FY 
2013 (see chart below). This is a reduction from the FY 2009 to FY 2010 
increase of 19.75 percent.

[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]


    The 61 percent increase in Transportation of Things is over a 2 
year period from FY 2010 to FY 2012. Estimates for Transportation of 
Things are made up of several components that are highly variable and 
are outside of the control of VA, such as Shipment of Bodies, Declared 
Emergency Shipment of Bodies, and Other Shipments which include 
shipment of personal effects of deceased beneficiaries.

[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

    B. Please explain the assumptions used to formulate the budget for 
employee travel and transportation of things.
    Response. VHA used the Administration's inflationary assumptions 
for the formulation of Employee Travel. VHA used an historical four 
year average to formulate the Transportation of Things because of the 
dramatic change in year-to-year actuals for this budget line.

    Question 2. The number of veterans who have served in the Armed 
Forces of the United States has been on a steady decline. The total 
veteran population has declined by 2.4 million since September 30, 
2006, and VA estimates it will decline by 427,793 veterans from 2011. 
However, VHA estimates their unique patients will increase by 85,567 in 
fiscal year 2012 over fiscal year 2011 and will increase further by 
another 116,607 in fiscal year 2013.
    A. If the overall veteran population is decreasing, what accounts 
for the steady increase in unique patients?
    Response. While the Veteran population is decreasing, the Veteran 
enrollment rates are holding fairly steady. Thus, in spite of the 
declining Veteran population, the enrolled Veteran population is 
projected to increase by approximately 465,900 from FY 2010 to FY 2013. 
This increase in Veteran enrollees results in a projected increase of 
approximately 274,000 Veteran patients from FY 2010 to FY 2013. 
However, the proportion of enrollees who are patients remains constant 
at 65 percent during this period. The likelihood of an enrollee 
becoming a patient is correlated with enrollee age, priority, gender, 
morbidity, special conflict status (OEF/OIF/OND status versus other), 
reliance on VA health care, and whether the enrollee used VA before or 
after Eligibility Reform. Also, new enrollees tend to have a higher 
likelihood of being a patient in the first year of enrollment.
    B. Of the unique patients, which period of veterans is expected to 
start utilizing the VHA system in greater numbers?
    Response. VA does not have the data on period of service for all 
enrollees that would allow a comparison of utilization of the VA health 
care system by period of service.

    Question 3. In the Budget Message of the President accompanying the 
fiscal year 2012 budget request, he writes:

        America is emerging from the worst recession in generations. In 
        2010, an economy that had been shrinking began to grow again. 
        After nearly 2 years of job losses, America's businesses added 
        more than one million jobs. (The Budget, page 1)

    With that in mind, the FY 2012 budget shows a contingency fund of 
close to $1 billion to cover a potential increase in demand due to our 
current economic conditions.
    A. If the President believes that the economy is getting better, 
why does VA need a contingency fund?
    Response. The $953 million contingency fund, estimated in the VA's 
Enrollee Health Care Projection Model, was created to address the 
potential demand increase for medical care services due to changes in 
economic conditions. Recent studies have shown that unemployment rates 
among Veterans are approximately double those of non-Veterans. As 
Veterans lose access to other health care options, such as employee 
health insurance, they increasingly seek VA care. These funds will only 
become available for obligation if the Administration determines that 
the estimated need due to economic conditions materializes in 2012.
    B. What is the threshold that needs to be reached for VA to use 
this additional funding? And what are the mechanics to releasing the 
fund?
    Response. Section 226 of the Administrative Provisions states that 
``* * * such funds shall only be available upon a determination by the 
Secretary of Veterans Affairs, with the concurrence of the Director of 
the Office of Management and Budget, that:

    (a) The most recent data available for:

         (1) National unemployment rates,
         (2) Enrollees' utilization rates, and
         (3) Obligations for Medical Services,
validates the economic conditions projected in the Enrollee Health Care 
Projection Model, and
    (b) Additional funding is required to offset the impact of such 
factors.''
    C. Should this increase in demand not materialize what is VA's 
alternate plan for this funding?
    Response. If the increase in demand does not materialize, these 
funds would not become available for obligation and they would be used 
for deficit reduction.

    Question 4. In the VA budget justification books under Medical 
Services there is a category that shows a savings of just over $1 
billion for ``operational improvements.'' The previous administration 
also sent to the Hill a budget request in fiscal year 2007 which 
included management efficiencies. In a Senate Committee on Veterans' 
Affairs (SVAC) hearing on the fiscal year 2007 VA budget, then-Senator 
Obama stated:

    The VA had made management efficiency claims which make up over $1 
billion in this year's budget, but the [Government Accountability 
Office (GAO)], at least, says haven't been and can't be proven. So one 
of the concerns, and I am sure you will hopefully have a chance to 
respond directly to this is, if those savings prove illusory, what 
happens and how are you planning that possibility? (SVAC hearing, Feb. 
16, 2006.)
    A. Should these savings not materialize, how has VA planned for 
that risk?
    Response. These savings estimates are in six separate areas of 
operations and represent modest, achievable goals unlike the 
unspecified savings referenced above.

    Question 5. The Medical Care Collections Fund was established by 
the Balanced Budget Act of 1997 and has shown a steady increase in what 
has been collected from first party and third party payers over the 
years. Originally, VA estimated it would collect $3.2 billion in fiscal 
year 2012. According to a conversation my staff had with VA's Chief 
Business Officer, that figure has been downgraded to $2.8 billion.
    A. How much of this down grade is due solely to a change in the 
actuarial model and has VA also assumed changes to the economy in this 
revision?
    Response. The down grade was not due to a change in the VHA Office 
of Policy & Planning's Enrollee Health Care Projection actuarial model. 
The reduction is a result of VA revising several assumptions from CBO's 
collections model to incorporate economic market conditions, in 
addition to a number of other factors, to project MCCF collections in 
FY 2012. These factors include:

     Poor economic conditions--Growth in national unemployment 
(from 7.7 percent in the First Quarter of FY 2009 to 9.8 percent at the 
end of the First Quarter of FY 2011) will continue to impact both first 
party collections (Veteran out-of-pocket costs) and third party 
collections (unemployment and resultant loss of health insurance 
coverage).
     Hardship waivers and exemptions from copayments are 
increasing--Veteran first party copayment economic hardship waivers and 
exemptions were at their highest levels in FY 2010 (the most recent 
completed year) than in any prior year, and this is expected to 
continue with the current economic conditions.
     Third party ``Collections to Billings'' (CtB) ratios are 
down nationally--CtB ratios are expected to continue a downward trend, 
reducing third party collections. CtB decreased from 43.1 percent in 
January 2009 to 39.1 percent in January 2011, and was influenced by the 
continued shift by insurers of payment responsibility to the patient 
(i.e., higher deductibles, increased copayments, etc.). Section 1729 of 
title 38 prevents VA from billing the Veteran if the insurance company 
does not pay. Each one percent decrease in CtB represents a $55 million 
loss in revenue.
     Veterans aging to 65 years and older--FY 2012 begins to 
reflect the shift in workload for Vietnam Era Veterans aging to 65 
years and older. Once a Veteran is Medicare-eligible, Medicare becomes 
the primary insurance coverage and VA can bill insurance companies only 
for the portions Medicare does not cover (typically their deductibles). 
This significantly reduces the amount VA can collect.
     Priority Group migration from lower to higher status--
National Priority Group migration over the past two years has shown a 
sharp decrease in collections for Veterans in Priority Group 8, which 
are the primary drivers of both first and third party collections.
     Shift in Service Connected Workload vs. Non-Service 
Connected Workload As Veterans migrate from lower to higher status, 
there is also a shift in workload from Non-Service Connected (Non-SC) 
care (which could be billable if the Veteran has insurance) to Service 
Connected (SC) care (regardless of insurance coverage VA does not bill 
for SC care). From FY 2009 to FY 2011 the total number of outpatient 
encounters has seen an increase of two percent nationally in SC care, 
with an equal decrease of two percent in Non-SC care, which has 
impacted Third Party collections.

    Question 6. The fiscal year 2012 budget request calls for savings 
of $150 million through medical and administrative support savings.
    A. What will be the total loss of FTE?
    Response. There are no discrete reductions in FTE included in this 
cost savings estimate. Total FY 2012 FTE is estimated to actually 
increase by 524. The savings are achieved through clinically 
appropriate substitution of less costly staff for more expensive 
predecessors, for example the replacement of a physician with a nurse 
practitioner, or the replacement of a registered nurse with a licensed 
practical nurse, in positions where there will be no degradation in 
either the quality or quantity of health care services provided to 
Veterans. There may be other occupations where care extenders may be 
utilized and, in each case, VHA will do appropriate assessments to 
ensure care to Veterans is not compromised.
    B. Please explain what type of positions fall within this category?
    Response. Please see response to 6. A.
    C. Will these cuts be realized at individual VA facilities or at 
Veterans Integrated Service Network (VISN) headquarters and VA Central 
Office?
    Response. The cost savings of $150 million will be achieved by more 
efficiently employing the resources in various medical care, 
administrative, and support activities at each medical center and will 
be achieved by targeting the following areas to improve overall 
operational efficiency:

     High missed outpatient appointments/no show rates
     Observed to Expected Length of Stay
     Diagnostic colonoscopy (CPT code 45378) cost per procedure
     Cardiac catheterization cost per procedure
     Primary care cost per encounter

    Question 7. The FY 2012 budget request proposes a change in current 
law to remove the requirement for VA to reimburse certain employees 
appointed under title 38, section 7401(1), for expenses incurred for 
continuing professional education. Under current law, the Secretary 
shall reimburse for up to $1000 per year for full time physicians and 
dentists for continuing education. The budget states that the change in 
law could have a potential cost savings annually of $325 million and 
$3.25 billion over ten years.
    A. How will VA guarantee that doctors and dentists have the ability 
to receive all of the continuing education needed to maintain their 
requirements under their licenses, specifically at facilities in rural 
areas without access to major academic institutions?
    Response. VHA health care professionals, including physicians, are 
solely responsible as a condition of employment for maintaining their 
professional licensure and for completing the associated continuing 
medical education requirements. VHA's Employee Education System (EES) 
provides training to support VHA's mission and pursues opportunities 
for accrediting these training programs for professional continuing 
education credits wherever feasible and advisable. Some training, 
education, or conference events may not be professionally appropriate 
for continuing education accreditation.

    Question 8. The FY 2012 budget request asks for $451 million for 
reimbursement to eligible veterans of emergency services pursuant to 
the Veterans Millennium Health Care Act. This represents an increase of 
$87.5 million since FY 2010 or 24%. The FY 2013 advanced appropriation 
calls for an additional $52.5 million, which is an 11.6% increase over 
FY 2012.
    A. What accounts for the 24% increase in the amount for reimbursed 
emergency services? To what extent is this attributable to Public Law 
111-137?
    Response. The 24 percent increase in the amount for reimbursed 
emergency services is not attributable to Public Law 111-137. Public 
Law 110-387, Section 402 is responsible for this increase. The change 
in the law, which allows for payment of emergency inpatient care beyond 
the point of stabilization if VA facilities are not available, is the 
primary reason for the significant increase in projected budget 
requirements. Other reasons contributing to this increase in projected 
costs include the increase in unique Veterans served, overall economic 
conditions impacting Veteran eligibility and utilization, and increased 
billing rates reflecting medical costs inflation.
    B. VA is currently rolling out the Patient Aligned Care Team (PACT) 
model with one of the goals of limiting the necessity of readmissions 
and hospitalization. If the PACT model will limit the growth of 
reimbursement for emergency services under the Millennium bill, what 
accounts for this increase in FY 2013?
    Response. The goal of limiting the necessity of readmissions and 
hospitalizations applies to those that occur in VA medical facilities. 
It will not reduce the cost of emergency admissions to civilian 
hospitals which are estimated to increase. The costs in FY 2013 are 
projected to increase when compared with FY 2012 but these costs will 
be less than what VA would have incurred without this initiative. 
Factors beyond VA's control, such as the proximity of Veterans to 
facilities (VA or non-VA) and rising health care costs influence the 
need for and cost of emergency care.

    Question 9. The fiscal year 2012 budget request for the Energy/
Green Management Program shows the program funding decreased 82% 
between FY 2010 and 2012. According to the budget request, the program 
is to be increased 15.5% between FY 2012 and 2013.
    A. With the fluctuations in the budget for the Energy/Green 
Management Program, how will VA have the necessary funding to meet the 
performance benchmarks set forth in Executive Order 13514?
    Response. VA contracted to implement a large number of green 
building, renewable energy, and energy/water efficiency improvement 
projects in FY 2010, which are scheduled to come on-line as late as FY 
2012. We also funded a number of feasibility studies for additional 
projects and are conducting energy assessments of 25% of our facilities 
annually. Performance improvements related to the FY 2010 investments 
are projected to be significant and to move VA successfully forward 
through FY 2013. In the meantime, we continue to incorporate renewable 
energy and other sustainable features into our new construction 
projects and to select future projects at existing facilities based on 
results of feasibility studies and energy assessments. To continue 
progress toward EO 13514 goals in the face of fluctuating direct 
funding, VA will be making use of third-party financing mechanisms--
energy savings performance contracts (ESPC) and utility energy savings 
contracts (UESC)--to procure some of these projects. Using these 
instruments will allow VA to implement projects without up-front 
investment, with costs paid for out of the stream of resulting 
operational savings. With a centralized contracting activity dedicated 
to the Energy/Green Management Program, VA is well-positioned to 
accelerate the use of ESPC/UESC to meet EO 13514 performance 
benchmarks. In addition, VA is pursuing a number of low cost/no cost 
initiatives as part of this program. For example, we are instituting a 
``stoplight'' style reporting process to evaluate how facilities are 
addressing EO 13514 requirements. We created a ``Green Routine'' 
program that encourages and supports all employees in everyday 
practices such as turning off lights and double-sided copying. And, we 
established two new internal awards programs, one covering ``green'' 
professionals such as environmental managers and one covering all other 
employees who make innovative contributions to greening their facility.

    Question 10. The fiscal year 2012 budget request shows an increase 
of 2,589 between FY 2011 and 2012 for contract hospital (psychiatric) 
workload and an additional increase of 2,143 between FY 2012 and 2013. 
At the same time, the budget request shows a decrease of 2,990 for 
psychiatric residential rehabilitation within VA over the same 
timeframe.
    A. Please explain the justification for eliminating internal 
psychiatric residential rehabilitation capacity with contract hospitals 
outside VA?
    Response. Psychiatry Average Daily Census levels have trended 
upwards over the last several years and out year projections indicate 
continued increases but at a slower rate. The experience with 
Residential Rehabilitation is different. VA Mental Health Service views 
Psychiatric Residential Rehabilitation (PRRT) and Domiciliary care as 
equivalent care options, and are both Residential Rehabilitation care. 
In recent years there has been a decrease in PRRT with a commensurate 
increase in Domiciliary Residential Rehabilitation Treatment. The 
budget for FY 2012 and FY 2013 forecasts an increase for the combined 
workload of PRRT and Domiciliary care, the two forms of Residential 
Rehabilitation care, as shown in the following table. 

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    Question 11. The fiscal year 2012 budget request estimates savings 
of $315 million in FY 2012 and $362 million in FY 2013 by moving the 
fee care program payments to be consistent with those of the Centers 
for Medicare and Medicaid Services (CMS) rates.
    A. What are the underlying assumptions for these estimated savings?
    Response. The underlining assumptions for these savings were based 
on use of the multiple pricing schedules covered under the regulation. 
VA has had authority to pay inpatient hospital claims and physician 
services utilizing the Centers for Medicare & Medicaid Services (CMS) 
payment methodologies for many years. Effective for non-VA treatment on 
or after February 15, 2011 VHA adopted CMS payment methodologies for 
outpatient services. This aligns VHA with standard Federal payment 
schedules and assures all payments from VA utilize the same structure. 
Prior to adopting CMS payment methodologies VHA processed payment for 
outpatient services for facility charges using a ``VA Fee Schedule'' 
which is based on billed charges and reimbursement was based on the 75 
Percentile of those charges, significantly higher than standard CMS 
pricing. The estimated savings was developed using the difference 
between the 75 Percentile from the VA Fee Schedule and the CMS rates 
extrapolated from actual payment data from the first six months of 
calendar year 2008. VHA contracted with an outside vendor to complete a 
comparison to identify cost savings under this legislation. The 
analysis compared CMS rates with VA Fee Schedule rates to make this 
estimate. A sampling of lab, ESRD, and other Medicare methodologies to 
estimate an average savings based on these rates.
    B. VA is currently in the process of upgrading the IT 
infrastructure to process the new fee payments at the Medicare rate. 
What is VA's timeline for completing these upgrades? Will VA be able to 
realize savings in FY 2012 if systems are not fully in place to handle 
the move to the CMS rate?
    Response. The current claims processing system, Fee Basis Claims 
System, is scheduled to be updated with CMS rates by mid-year FY 2012. 
To assure accurate pricing, VA developed an interim solution utilizing 
a contract service to price claims submitted to VHA for authorized 
services by non-VA providers. This service will initially be manual, 
with a move to a web-based solution by the end of April. The VA will 
continue to utilize this service until such time as the appropriate 
technology is in place to accurately price these claims.
    C. How do the savings in the FY 2012 budget request compare to the 
estimates that VA provided in the regulations moving the purchased 
dialysis program to CMS rates? Please explain any changes in 
assumptions that led VA to adjust the savings estimate.
    Response. The FY 2012 budget request utilizes the same cost savings 
estimates documented in the Final Rule.
    D. How are the anticipated savings in the FY 2012 budget request 
affected by contracts that VA currently has in place with private 
dialysis facilities or from replacing these contracts with payments at 
the Medicare rate?
    Response. VA is currently assessing the impact of continued use of 
contracts in relation to the new regulation. This assessment will 
include a specific market analysis and a determination on impact to 
access for health care, assuring access is not negatively impacted 
while also assuring a cost effective program.
    E. Please explain the estimated savings VA will accrue from 
dialysis contracts and Basic Ordering Agreements compared to the former 
regulation that required VA to pay at the 75th percentile of billed 
charges?
    Response. Cost savings in FY 2011 were estimated based on use of 
contracts and blanket ordering agreements (BOA). The contract and BOA 
rates and payments are compared with prior year payments. Prior to use 
of contracts/BOAS VA was required to pay at the 75th percentile of 
billed charges.

    Question 12. The FY 2012 budget request calls for clinical staff 
and resource realignment which will presumably save VA $150.8 million. 
To reach that projected savings, VA states it will cut 313 doctor and 
1,133 registered nursing positions. The lost FTE will be replaced by 
non-physician providers and LPNs. Due to the economic down-turn, 
thousands of skilled registered nurses have reentered the workforce. It 
would seem that we should be trying to entice these skilled clinicians 
to work at VA; however, VA has decided to cut the number of RN 
positions for FY 2012.
    A. Registered nurses are the backbone of any well operated hospital 
or clinic. What will be the effect to both institutional knowledge and 
patient care if VA is successful in cutting the numbers of doctors and 
registered nurses and replacing them will less trained and skilled 
positions?
    Response. VA is replacing positions through attrition, not 
designated elimination of staff, so there will be no acceleration of 
loss of institutional knowledge. Only those positions identified as 
clinically appropriate will be used for substitution of more cost 
effective specialties, so there is no anticipated impact on patient 
care.
    B. Will these cuts in RN and physician FTE result in the loss of 
actual personnel at facilities or are these FTE not currently filled? 
If not, why does the budget include positions that are not filled?
    Response. These estimates are based on substitution of positions 
with less costly and more clinically appropriate specialties when they 
become vacant. There is no associated loss of total FTE. Positions that 
have not historically been filled are not included in the budget 
estimates.
    C. Please explain the decisionmaking process that led VA to make 
this cut in RN positions.
    Response. In response to anticipated resource constraints and to 
exercise good stewardship of VA resources, the executive leadership at 
each VA medical center or program office will determine if a physician 
or registered nurse position that becomes vacant requires a replacement 
with the same clinical skills or may appropriately be filled with a 
less costly alternative specialty without any degradation of quality or 
capacity of health care for Veterans.

    Question 13. VA has taken a number of steps over the last two years 
to try and limit the number of hospital or clinic visits which are 
needed for veterans. The PACT model is only one facet of VA's strategy 
to better coordinate care between primary and specialty care, with the 
ultimate goal of allowing veterans to receive all of their needed 
treatment and consultations in one visit. In order to better understand 
how veterans are currently utilizing VA services, please provide the 
following information.
    A. VA has stated that by realigning the primary care model used at 
their facilities, scheduling of appointments will be focused on 
veterans' wishes and will eliminate the need for multiple visits. 
Please define what VA believes constitutes unneeded multiple visits.
    Response. Unneeded multiple visits are those where patient concerns 
can be addressed by means other than face-to-face clinic visits e.g., 
telephone care, secure messaging, My HealtheVet, and/or mail. In 
addition, VA data suggests return visit intervals can be increased 
resulting in a reduction of clinic visits without a decrease in quality 
by using other means as well.
    B. Assuming there have been unneeded multiple visits, how many 
unneeded multiple visits took place in FY 2010, how many took place in 
FY 2011, and how many are forecasted for FY 2012?
    Response. Currently, this data is not available in the VA 
scheduling package.
    C. VA currently has performance metrics for both primary care and 
specialty care appointments completed within 14 days of the desired 
date. How does VA measure the interrelation between scheduling primary 
and specialty care appointments on the same date?
    Response. When making appointments, schedulers are instructed to 
coordinate appointments for patients as much as possible. However, VHA 
Directives do not require that appointments for primary and specialty 
care be scheduled to occur on the same date. For that reason, VHA does 
not monitor the number of primary and specialty care appointments 
scheduled to occur on the same date. The wait time for each appointment 
is purely the measurement of the number of dates from the desired date 
for that specific appointment and the date that appointment is 
completed. However, if a Veteran were to specify that his desired date 
for an appointment is on the same date another appointment is scheduled 
to occur, he scheduler would be expected to enter that date as the 
desired date for the appointment being scheduled, and if possible offer 
an appointment on that date.

    Question 14. In recent months, the Committee has been approached by 
senior former employees at VA medical centers from across the country 
claiming they were targeted by their superiors for raising concerns 
about improper facility practices. They raised concerns specifically 
with the use of what VA calls ``Administrative Investigations Boards.''
    There is an obvious need for Medical Directors to investigate 
malfeasance and fraud in VA facilities. However, Medical and VISN 
directors do not always have the ability to terminate or punish those 
who have been found to put veterans' lives at risk or who have become a 
liability to the organization. Yet some senior level former VA 
employees suggest that certain senior leaders have found ways to abuse 
the process and have used it as a tool to retaliate.
    A. VA has previously indicated there is no centralized oversight of 
AIBs by the VISNs or VA Central Office. In fact, VA has stated that the 
guidelines for AIBs are almost at the complete discretion of the senior 
leader who convenes an AIB. How does VA conduct oversight and provide 
guidance from the VISN and Central Office to ensure the AIB's are used 
properly?
    Response. VA Directive 0700 establishes policy within the 
Department of Veterans Affairs (VA) regarding administrative 
investigations. It establishes uniform standards for the conduct, 
reporting, and review of administrative investigation boards, and 
clarifies the responsibilities of those involved. VA Handbook 0700 
establishes operational requirements and procedures for convening, 
conducting, reporting, and reviewing administrative investigations. The 
General Counsel (GC) is responsible for the contents of both documents. 
However, GC does not typically oversee local administrative 
investigations.
    Determining the facts and the appropriate response to matters 
within their areas of responsibility is an inherent duty of VA 
executive leadership. Generally, the decision to order an 
investigation, and the appropriate scope of the investigation, is a 
matter within the discretion of the Convening Authority. These actions 
are expected to be consistent with VA Directive/Handbook 0700 and any 
other governing requirements. Retaliation by any VA employee against 
any person for cooperating with an investigation or providing truthful 
testimony is prohibited. In some cases, employees are entitled to 
specific protections against retaliation, such as those established 
under the Whistleblower Protection Act. Witnesses who believe they are 
being reprised against can report the matter to the Convening Authority 
and they may also report the matter to the Office of Special Counsel 
(OSC) or VA's Office of Inspector General (OIG). Employees who believe 
the investigation was convened for the purpose of harassment following 
their participation in protected activity may also report their 
concerns to OSC, the VA OIG, or other senior officials in the 
employee's supervisory chain of command.
    The VA Secretary's memorandum dated July 30, 2009 entitled ``Senior 
Management Conduct Issues'' requires specific procedures for 
investigation of allegations of serious misconduct involving senior 
managers. Senior managers include all members of the Senior Executive 
Service; Associate and Assistant Directors; Chiefs of Staff, Nurse 
Executives at VHA facilities, heads of other VA facilities; including 
National Cemeteries, Network Offices, and Regional Offices; any GS-15 
position or Title 38 equivalent in VA Central Office; and all other 
positions centralized to the Secretary. All Administrative 
Investigative Boards that concern VHA senior managers are attended by 
or reviewed by the VHA Human Resource Management Group, which has a 
reporting alignment to the Under Secretary for Health through VHA's 
Workforce Management and Consulting Office. To assure consistency 
throughout the Agency, any decisions involving occupants of these 
covered positions require the concurrence of the Office of General 
Counsel and VA Office of Human Resources Management. The reviews by 
these other offices also occur even when determinations are made that 
no action is necessary or counseling or training is recommended.
    The Office of Human Resources Management in VA Central Office 
provides regular training in the conduct of administrative 
investigations for potential board members. Additionally, VHA's Senior 
Executive Orientation recently added a session addressing ``When to 
convene an AI?''
    B. Which office in VA has direct responsibilities for ensuring fair 
procedures are being followed in the AIB process?
    Response. As indicated above, OGC is responsible for implementing 
the requirements found in VA Directive/Handbook 0700, but does not 
directly oversee each investigation. Employees who have concerns 
regarding unfair procedures during the conduct of an AI may report 
their concerns to the Convening Authority or other senior management 
officials. In addition, employees who believe an investigation is being 
used to harass them for engaging in protected activity may contact the 
OSC or the VA OIG.
VHA Performance Plan

    Question 1. In the FY 2012 budget request there is a performance 
indicator listed with the stated major institutional goal to ``design a 
veteran-centric health care model and infrastructure to help veterans 
navigate the health care delivery system and receive coordinated 
care.'' The only associated performance measure for this is the non-
institutional long term care average daily census, which has a limited 
scope dealing directly with long term care. With the roll out of the 
PACT model, what performance measures will VA utilize to measure both 
PACT and the major institutional goal of designing a veteran-centric 
health care model and infrastructure?
    Response. Currently, VA uses the Primary Care Staffing ratio to 
monitor and measure PACT infrastructure implementation and patient and 
employee satisfaction scores to measure satisfaction with 
implementation. In addition, VA also monitors access, coordination, and 
continuity as indicators of PACT implementation progress.
Veterans Canteen Service Revolving Fund

    Question 1. In the FY 2012 budget request, the current estimate for 
FY 2011 shows personnel costs totaling $12.1 million while only 
estimating $11 million in fiscal year 2012. In addition, in the Summary 
of Employment section there is a projected increase of 25 employees 
from FY 2011 Current Estimate to FY 2012.
    A. What accounts for the increase in average employment while 
decreasing the amount of money obligated to the costs of personnel?
    Response. Projected personnel increases are the result of new or 
upgraded canteen operations in CBOCs and outpatient clinics. Most 
Canteen Service personnel are hourly rate workers, employed either 
full-time or part-time. Consequently, the estimated annual cost for 
these employees is considerably less than it would be for 25 full-time 
employees.
    The original cost estimate for FY 2012 would have shown a slight 
increase from the FY 2011 estimate due to the new hires and an assumed 
increase in the cost-of-living allowance. However, the estimate was 
revised downward as a result of the pay freeze to a figure that is 
slightly less than the original estimate for FY 2011.

    Question 2. In the program description of the Veterans Canteen 
Service, the FY 2012 budget request mentions that ``provisions of the 
Veterans' Benefits Act of 1988 * * * eliminated the requirement that 
excess funds be paid to the Treasury and authorized such funds to be 
invested in interest bearing accounts.''
    A. What type of interest-bearing accounts have the excess funds 
been invested in?
    Response. The Veterans Canteen Service (VCS) invests only in 
Treasury bills.
    B. Please detail the invested funds performance since the ability 
to do so was authorized.
    Response. Over the past 10 years, VCS investment income has varied 
due to market-based fluctuations in interest rates. Before 
September 11, 2001, VCS earned $1.5 to $2 million per year. Since 
September 11, 2001, rates were dramatically lower as interest income 
ranged from $381,000 to $800,000 per year through 2008. Since 2008, 
interest rates have been zero and VCS proceeded with significant 
capital and technology investment thus reducing funds invested. In FY 
2012 VCS expects capital and technology investments to slow and 
investment income begins to grow.

    Question 3. The fiscal year 2012 budget request shows a decrease in 
the Cost of Merchandise Sold from $24.5 million in FY 2011 to $15 
million in FY 2012.
    A. Please outline the reasons for a projected decrease of $9.5 
million in Cost of Merchandise Sold.
    Response. There has not been a decrease in Cost of Merchandise Sold 
from FY 2011 to FY 2012 which is presented in the ``Analysis of 
Increases and Decreases--Obligations'' table in the President's FY 2013 
Budget Submission, Vol. 2, page 4A-3 (below).
    The table shows an overall estimated increase of $62,547, 000 in 
obligations for FY 2011, of which $24,500,000 is an increase in Cost of 
Merchandise Sold. For FY 2012, the table shows an overall estimated 
increase of $41,000,000, of which $15,000,000 is an increase in Cost of 
Merchandise Sold.
    The question assumes that the total Cost of Merchandise Sold fell 
from $24,500,000 to $15,000,000 between FY 2011 and FY 2012 when in 
fact the amount increased each year by those amounts.

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                           homeless veterans
    Question 1. The President has made ending homelessness among 
veterans a top priority of his administration. The FY 2012 budget 
request includes $939 million, a 51% increase from FY 2010, for 
specific programs to prevent and reduce homelessness among veterans.
    A. Do the fiscal year 2012 request and the fiscal year 2013 advance 
funding request anticipate or require changes in the law to release 
funding for homeless veterans' programs?
    Response. There are two specific programs for which changes in law 
are requested the Grant and Per Diem (GPD) Program and the Support 
Services for Veterans Family (SSVF) Program. VA's FY 2012 budget 
submission includes increased funding for both the GPDSSVF programs for 
FY 2012 and FY 2013
    Section 2013 of title 38, United States Code, currently authorizes 
the appropriation of up to $150,000,000 per fiscal year for the GPD 
Transitional Housing program. The GPD Program FY 2012 and FY 2013 
budget anticipates an increased level of spending in order to increase 
program capacity to serve approximately 20,000 homeless Veterans. The 
budget request for FY 2012 and FY 2013 is $224,117,000 per fiscal year. 
To accommodate this anticipated increase, a legislative change in the 
authorized spending amount is requested.
    The SSVF Program currently is authorized to spend up to $60 million 
over three years ending in FY 2011. FY 2012 and FY 2013 budgets 
anticipate a $100 million annual appropriation. Such an appropriation 
contemplates modification of the SSVF Program's current funding 
authority. Approximately 19,000 Veterans and their families will 
receive services in 2012 and 2013.

    Question 2. Even though the administration has made ending 
homelessness among veterans a top priority, the Domiciliary Care for 
Homeless Veterans and the Compensated Work Therapy programs have a 
reduction in their budgets. The FY 2012 request has a 10% decrease for 
Domiciliary Care for Homeless Veterans and an 11% decrease for the 
Compensated Work Therapy/Vocational training program from FY 2010.
    A. What is the justification for the reductions in these programs' 
budgets? How do the reductions in these programs align with VA's 
overall strategy to end homelessness?
    Response. The Domiciliary Care for Homeless Veterans (DCHV) and 
Compensated Work Therapy (CWT) budget projections are based on 
historical program costs plus additional program cost that are part of 
the initiative to end homelessness among Veterans. The FY 2010 
President's budget costs were estimated at $119 million and did not 
contain any new program costs related to the homeless initiative. The 
actual FY 2010 DCHV costs were $175 million. The increase in FY 2010 
actual costs is related to program expansion and initiatives to improve 
workload capture and cost reporting.
    The FY 2011 and FY 2012 figures are estimates based on historical 
costs plus planned expansion related to the homeless initiative. The 
Veterans Health Administration (VHA) will continue to monitor budget 
estimate verses actual costs to further refine budget submissions. The 
FY 2012 CWT and DCHV budget requirements will be reevaluated and 
addressed within the total Homeless program budget as FY 2011 Actuals 
become finalized and VA's FY 2013 President's budget costs are 
submitted.

    Question 3. The Housing and Urban Development-VA Supported Housing 
(HUD-VASH) Program is one of the signature VA initiatives to provide 
permanent housing to homeless veterans with case management services. 
Since 2008, Congress has funded approximately 30,050 vouchers. As of 
December 31, 2010, only 21,078 formerly homeless veterans are currently 
living in permanent housing. The President's request for FY 2011 and FY 
2012 includes additional funding for 10,000 vouchers each year.
    A. Of the remaining 9,422 vouchers, only 7,419 have been issued to 
veterans. What is the status of vouchers that have not been issued to 
veterans? When does VA believe that all vouchers will be issued and 
leased?
    Response. HUD has received approximately 30,000 HUD-VASH vouchers 
since 2008 (approximately 10,000 per year in 2008, 2009 and 2010). HUD 
is responsible for allocating these vouchers to local Public Housing 
Authorities (PHA) and VA's role in the program is to screen, case 
manage, and refer eligible Veterans to PHAs for distribution of these 
vouchers.
    The data referenced above reflect cumulative numbers starting in 
2008.
    As of February 28, 2011, 19,834 Veterans are currently under lease. 
Of the vouchers not leased up, approximately 6,667 are in the hands of 
Veterans who are in the housing search process. Approximately 3,936 
Veterans have been referred to the PHA to undergo the process of 
background checks to ensure the referred Veterans are not on any sexual 
offender registry and that they qualify for income eligibility.
    It is important to note and understand that these numbers are 
dynamic and that Veterans leased up today could not be leased up 
tomorrow due to ``graduation'' or ``falling out'' of the HUD-VASH 
program for a variety of reasons. This response provides a point-in-
time snapshot of HUD-VASH voucher status as of February 2011.
    VA is working diligently with HUD and local PHAs to ensure that 
Veterans receive supportive services during this process. VA is working 
with the PHA to ensure that vouchers are assigned expeditiously and to 
ensure the maximum number and Veterans are placed into permanent 
housing.
    Additionally, vouchers can be re-issued and have been re-issued to 
other homeless Veterans. VA, through its case managers, is working 
diligently with the PHAs to issue these vouchers. It is important to 
note that the number of vouchers available for issue at any given time 
fluctuates as a result of Veterans who ``graduate'' or discontinue the 
program and no longer need their voucher. These vouchers are able to be 
redistributed.
    Once a Veteran is referred to the HUD-VASH program, it takes an 
average of 126 days for the Veteran to get housed. During this time, 
Veterans are referred to the PHA to complete the application process, 
begin identifying and locating suitable and affordable housing, 
arranging for the inspection of the selected unit, signing the lease 
with the landlord, and making arrangements to move into their housing. 
Additionally, Veterans are engaging in clinical services that assist 
them in enhancing their skills to live a full and productive life.
    Many VA facilities are working closely with their PHA partners, 
landlords and other community groups to streamline the process and 
improve the timeliness of distributing vouchers to Veterans and moving 
them into rental units. Significant improvements have already occurred. 
In the first year, the mean cumulative lease up rate was 548 Veterans 
housed each month. In 2010, the mean cumulative lease up rate increased 
to 929 Veterans per month, and thus far in FY 2011, the mean cumulative 
lease up rate is 992 Veterans per month. VA believes it can maintain 
this rate, and will have approximately 90% of the Veterans permanently 
housed by September 30, 2011.
    B. Of the remaining vouchers, what VA medical facilities were these 
vouchers allocated to? How is VA ensuring there is not a systematic 
problem resulting in issuing the remaining vouchers?
    Response. As of February 28, 2011, the attached list of the medical 
centers have vouchers that still need to be assigned.

[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

    To clarify, the local Public Housing Authority (PHA) receives the 
vouchers and awards them to eligible Veterans referred by HUD-VASH case 
managers at the local VA medical center.
    Note: This list is dynamic and will change based on the 
productivity and activity of the medical center. The number of vouchers 
available at any given time fluctuates as a result of Veterans leaving 
or discontinuing the program and no longer needing vouchers. These 
vouchers are able to be redistributed.
    VA is confident that delays are not systemic and is working with 
these Medical Centers to ensure they are assisting homeless Veterans as 
expeditiously as possible. VISNs and Medical Centers submit to the VA 
National Homeless Program Office at least monthly reports of voucher 
issuance and lease up rates. The National Program Office has been able 
to determine where sites are experiencing delays. As of the end 
February 2011, 20 of the 132 medical centers awarded vouchers account 
for 90% of the underutilized vouchers. A total of 98 sites have fully 
implemented their vouchers. Reasons for delays vary and include 
clinical decisions to have Veterans treated in a more acute treatment 
setting to address mental health and medical concerns prior to 
referring them for permanent supportive housing with the Public Housing 
Authorities, hiring delays at the local Medical Center, the need for 
better collaboration with the community in identifying homeless 
Veterans and streamlining the application process, reconciling poor 
credit histories for Veterans and obtaining access to funding to help 
Veterans with move in expenses. Delays have also occurred due to 
difficulties in finding and approving suitable affordable housing in 
certain high cost areas. VA will continue to put emphasis on 
incorporating the Housing First model into its HUD-VASH program, 
allowing Veterans more timely access to housing, while providing them 
with needed supportive services to ensure that they are able to 
maintain housing. VA is also actively pursuing the use of shared 
contracted community case management services in those communities with 
VA medical centers that have been slow to hire case managers.
    C. Of the veterans who have received a HUD-VASH voucher, how many 
are gainfully employed and have been able to return the voucher because 
they no longer need the program?
    Response. As of February 2011, homeless program evaluation data 
indicates that there are 752 Veterans whom have exited HUD-VASH because 
they met program goals, exceeded the income limits and no longer need 
the program to remain in permanent housing, or found and obtained 
alternative housing.
    Specific gainful employment data is not directly collected at this 
time.
    D. How is VA ensuring that homeless veterans living in rural and 
underserved areas are able to participate in the HUD-VASH program?
    Response. In the voucher selection processes for past years, HUD 
and VA were able to target approximately 11% of the allocated vouchers 
to rural and underserved areas in recognition of the fact that 
identifying and serving rural homeless is a priority. VA and HUD work 
closely to disseminate housing choice vouchers where they are most 
needed. Furthermore, when vouchers are not being appropriately utilized 
by a local Public Housing Authority (PHA), HUD has taken proactive 
measures to relocate those vouchers to another PHA that has Veterans 
with unmet housing needs. VA will continue to monitor this issue and 
coordinate with HUD to get vouchers to locations where there is unmet 
need.

    Question 4. HUD-VASH case managers play a vital role in the 
operation and success of the HUD-VASH program. Case managers are on the 
front lines working with veterans, landlords, and other community 
organizations to assist homeless veterans in obtaining and maintaining 
permanent housing. In the President's request, the HUD-VASH case 
management account receives a 183% increase from FY 2010.
    As of December 31, 2010, VA has funded 1,230 HUD-VASH positions; 
however, only 897 have been filled.
    A. Is VA contracting with local organizations to ensure that 
homeless veterans are receiving case management services? If not, does 
VA need legislative authorization to contract these services?
    Response. VA is able to contract with local organizations to ensure 
that homeless Veterans receive case management services. In FY 2010, 
The DC VA Medical Center contracted with the District of Columbia to 
provide community case management services for 150 Veterans. All 150 
Veterans were placed in housing within 6 months, and because of the 
success with this initiative, the contract was extended. Sites in 
California, Florida, New York City and Denver are currently exploring a 
targeted shared contracted case management model.
    B. How many additional case managers will be needed to ensure that 
the additional vouchers are effectively and efficiently received by 
homeless veterans?
    Response. VA is funded for 1,207 case managers rather than 1,230. 
VA expects to continue using a staff to Veteran funding ratio of 1 case 
manager for every 25 Veterans whom are utilizing a voucher. Therefore, 
if HUD receives funding for an additional 10,000 vouchers, VA would 
anticipate hiring another 400 case managers. It is important to note 
that the number of case managers that will be needed is dependent upon 
the number of vouchers allocated.

    Question 5. On May 20, 2010, the Senate Appropriations Subcommittee 
on Transportation, Housing and Urban Development, and Related Agencies 
and the Subcommittee on Military Construction, Veterans Affairs and 
Related Agencies held a hearing regarding ending veterans' 
homelessness.''
    Secretary Donovan testified as follows: ``For FY 2011, HUD did not 
request funding for HUD-VASH. While the need for homeless veterans' 
assistance is great, with the significant level of resources that we 
have been provided by Congress in recent years, we want to ensure that 
these resources are used as effectively and efficiently as possible.''
    A. Planned program expansions will provide an additional 10,000 new 
vouchers in 2011 and 2012. How is VA ensuring that these additional 
resources will be used effectively and efficiently? What is VA's 
justification for the additional vouchers when HUD did not request 
additional vouchers in FY 2011?
    Response. VA has several processes in place to ensure resources are 
used effectively and efficiently. VA and HUD have a shared Office of 
Management and Budget high priority performance goal for which both 
agencies have committed to reducing the number of homeless Veterans on 
any given night to 59,000 by June 2012. A primary strategy for 
achievement of this goal involves utilizing the HUD-VASH program to 
provide homeless Veterans with vouchers so they can access permanent 
housing. This high performance goal provides an opportunity for both 
agencies to improve performance.
    VA has established performance monitors that promote timely hiring 
of case managers and timely lease-up rates of awarded vouchers by 
medical centers. Medical Centers that are having implementation issues 
have been asked to provide action plans. In regards to hiring, all 
medical centers that have not filled these positions are required to 
submit action plans and progress toward hiring until all positions are 
filled. VA anticipates all positions will be filled by June 30, 2011. 
Medical Centers have been instructed to detail appropriate staff into 
any vacant case management positions to ensure Veterans have timely 
access to case management services. The National Homeless Program 
Office is providing oversight to medical centers that are encountering 
difficulty with hiring; and in some cases, VA is working with medical 
centers to contract case management services with known and proven 
community partners.
    In instances where there have been low leasing rates, site visits 
have been made and technical assistance has been provided. Medical 
Centers have been asked to provide corrective action plans which are 
being closely monitored by the VA National Homeless Program Office. As 
VA addresses the issues that have caused delays at these sites, they 
should be well positioned to more quickly process any additional 
vouchers that may be forthcoming.
    Both HUD and VA have also conducted consultative site visits with 
communities experiencing implementation delays. These visits have 
assisted in reducing barriers and promoting greater coordination 
between VA, Public Housing Authorities (PHA) and community partners. VA 
plans to continue this process through FY 2011.
    VA and HUD plan to continue the performance component, instituted 
in FY 2010, to the voucher award allocation process that incentivizes 
high performers and challenges low performers to increase their 
productivity as a pre-condition to receiving additional vouchers. VA 
and HUD will continue to conduct training for both VA case managers and 
for PHA staff. Additionally, VA and HUD will continue to conduct 
satellite broadcasts to inform and train staff. Finally, in response to 
extreme situations, HUD has reassigned vouchers to other PHAs.
    VA is promoting the utilization of a Housing First Model in several 
large cities. Housing First promotes rapid and direct placement of 
homeless individuals (in some cases with accompanying family members) 
into housing, and offers treatment and supportive services with 
variable intensity and frequency as an integrated component of the 
service. The Housing First approach represents a change from linear 
models that seek to prepare individuals for permanent housing by 
requiring completion of treatment in residential rehabilitation or 
transitional housing, and often require demonstrated sobriety before 
moving into permanent independent housing.
    VA requested additional funds to hire case managers that would 
support HUD VASH vouchers to ensure the Department was poised to 
implement programming should additional vouchers be awarded to HUD.
    In FY 2008 and in FY 2010, HUD did not request in the President's 
budget additional vouchers but received 10,000 vouchers each of those 
years in the HUD-VASH Program. Based on this prior history, the 
Department requested additional case mangers to handle any additional 
vouchers.
    VA continues to review and refresh its plan to end Veteran 
homelessness as new information and data is obtained. The Veteran 
Supplemental Report to the 2009 Annual Homeless Assessment Report 
(AHAR) to Congress reports 75,609 homeless Veterans on any given night. 
The total annual count of sheltered and unsheltered homeless Veterans 
exceeded 160,000 of which 38% or 60,000 were chronically homeless. This 
estimate of Veteran homelessness and unmet need, demonstrates to VA 
that obtaining additional permanent housing resources would be 
valuable.
    B. With the rapid increase of vouchers in 2011 and 2012, how does 
VA plan to effectively allocate the vouchers to local VA medical 
centers and local public housing authorities to ensure that veterans 
receive the vouchers in a timely manner?
    Response. Housing and Urban Development is ultimately responsible 
for allocating vouchers to local public housing authorities.
    In past years, VA has conferred with HUD in determining relative 
need, using data provided by the Continuums of Care Point in Time data 
and VA homeless outreach data. Input from the respective Medical 
Centers is solicited and previous performance data is also considered. 
As plans for allocations approach finalization, facilities were 
notified to submit staffing plans for expedited approval so they could 
either commence hiring, or utilize contracted services which are 
already being set up in some locales.
    To ensure that Veterans receive vouchers in a timely manner, VA 
continues to transform its HUD-VASH program to the Housing First model. 
This allows Veterans quicker access to housing while providing them 
with needed supportive services to ensure that they are able to 
maintain housing. VA is also actively pursuing the use of shared 
contracted community case management services in those communities with 
VA medical centers that have been slow to hire case managers.
    VA also instituted a performance measure regarding the number of 
vouchers issued to the medical center/facility that result in a 
homeless Veteran achieving resident status in PHA. As of February 28, 
2011, the cumulative HUD-VASH achieving resident status rate was 77%.
    C. How is VA working to ensure the local partnerships between VA 
medical centers, public housing agencies, and community organizations 
in rural and underserved areas are effectively working together to end 
homelessness among veterans?
    Response. At the National Forum on Homelessness Among Veterans 
Conference held in December, 2010, each Medical Center was charged with 
holding a Homeless Veteran Summit to confer with key partners in VA's 
efforts to end homelessness among Veterans. Key partners included local 
Public Housing Authorities, Continuums of Care, HUD, Department of 
Labor, State VA Departments other key Federal, state and local 
organizations. The goal of these meetings was to determine ways to more 
efficiently and effectively assist homeless Veterans in accessing 
needed supportive services and suitable permanent housing in order to 
achieve and maintain stabilization. There were over 170 Summits held 
locally. These summits have improved existing partnerships and assisted 
in building new partnerships.
    Also at this conference, each VA Medical Center was directed to 
participate in the 2011 Point in Time Count of the homeless held in 
January, and in their local Continuums of Care. These directives have 
served to foster closer cooperation and collaboration between VA staff 
and community providers in rural areas. These meetings will continue 
and further strengthen the ability of VA and other housing and service 
provider partners to effectively work together to end homelessness 
among Veterans.
    In a further effort to expand partnerships in rural communities, 
the VA National Center on Homelessness among Veterans has developed a 
model of case management that combines homeless and mental health case 
management teams to improve access and engagement of homeless Veterans 
and Veterans with serious mental illness in rural communities. The 
model is currently being implemented in 16 VISNs across the country 
with a primary objective of identifying and engaging Veterans in 
treatment while also increasing their access to homeless and other 
supportive services both within the VA and with other community 
partners. The combined homeless and mental health intensive case 
management teams are engaged in outreach and treatment helping to 
increase both mental health and homeless services for Veterans in rural 
America. Results from this project will be available by the end of this 
fiscal year.

    Question 6. Under the Operational Improvement section of the VA 
Real Property Cost Savings and Innovation Plan, the President proposes 
a $66 million cost savings through the VA Real Property Cost Savings 
and Innovation Plan. Under this plan, VA has identified 17 vacant or 
underutilized buildings to repurpose for homeless housing and other 
enhanced-use lease initiatives.
    A. VA must maximize the utilization of the buildings identified. 
Please list where the 17 buildings are located. Has VA engaged the 
local community in these areas to determine what types of homeless 
facilities are needed, such as transitional or permanent housing?
    Response. VA continues its efforts toward achieving the goals set 
forth in the President's Memorandum on Real Property. VA has engaged 
local communities at key decision points in the process of repurposing 
its vacant and underutilized assets through enhanced-use leasing 
(EUL)--i.e., during a) the upfront planning phase to determine 
feasibility and need by conducting a market assessment for each campus 
to match supply (buildings and land) and demand among Veterans for the 
following housing types: Supportive Housing--housing with on-campus 
supportive services for homeless and at-risk Veterans and their 
families; Senior Independent Living--housing with limited on-campus 
supportive services for low-income Veterans who are 62 and older and 
capable of living independently; and Non-Senior Assisted Living--
housing with limited on-campus supportive services for disabled low-
income Veterans--and b) the EUL project implementation phase through a 
public hearing to solicit stakeholder and local community input into 
each project.

                 17 Vacant or Underutilized VA Buildings
------------------------------------------------------------------------
                                                    Building
 Network                Station Name                 Number    Total GSF
------------------------------------------------------------------------
        1 Newington, CT                                  5      17,799
        1 Newington, CT                                 43       3,872
        7 Augusta, Uptown                               18      28,530
        7 Augusta, Uptown                                7       4,420
        7 Augusta, Uptown                               76      56,712
       10 Chillicothe                                   10       6,750
       12 North Chicago                                 48      26,496
       12 Hines                                         48      39,546
       12 Hines                                         51      58,000
        7 CAVHCS, Tuskegee                              62      72,203
       21 Menlo Park                                   301      15,200
       12 Milwaukee                                      2     133,730
       23 Minneapolis                                  229       9,000
       23 Minneapolis                                  211      19,160
       15 Topeka, KS                                   261       1,369
       15 Topeka, KS                                   263       1,376
       15 Topeka, KS                                   265       1,526
         ---------------------------------------------------------------
            Total                                ..........    495,689
------------------------------------------------------------------------

    B. How does VA plan to proceed with this initiative to ensure that 
the maximum amount of homeless veterans can be reached? Has VA worked 
to strengthen community partnerships in these communities to provide 
the most beneficial and successful alliances for all stakeholders?
    Response. VA has included this initiative in the five-year plan to 
end homelessness among Veterans . Information has been disseminated to 
VA senior management at VA medical centers, VHA Network Homeless 
Coordinators', VA national conferences and calls. VA's Homeless 
Veterans Initiative Office and the Office of Asset Enterprise 
Management has meet with local community organizations interested in 
providing housing for homeless Veterans on VA property to assist with 
development issues.
    Strengthening partnerships with communities is a major pillar of 
VA's plan to end homelessness among Veterans. The Homeless Veteran 
Initiative Office is the lead office and is developing and maintaining 
strategic external partnerships and socializing VA's Plan to End 
Veteran Homelessness.

    Question 7. Within the Office of Public and Intergovernmental 
Affairs, VA has established the Homeless Veterans Initiative Office 
(HVIO), which ``is responsible for policy development, inter and intra-
agency coordination, developing/maintain strategic external 
partnerships and socializing VA's plan to end Veteran homelessness.'' 
In addition, VA has also created the National Center on Homelessness 
among Veterans, ``whose mission is to develop, promote and enhance 
policy, clinical care, research and education to improve homeless 
services.''
    A. How do these offices align with VA's five year plan to end 
homelessness? How do these offices function with other offices 
responsible for overseeing homeless programs?
    Response. The Office of the Assistant Secretary for Public and 
Intergovernmental Affairs (OPIA) is the Executive Sponsor for the 
Homeless Veteran Initiative. This office serves as the departmental 
lead for coordination, communications and monitoring of VA's Plan to 
End Homelessness Among Veterans. The Homeless Veteran Initiative Office 
(HVIO) serves as the lead point of contact with the White House and 
other Federal agencies, including the U.S. Interagency Council on 
Homelessness, and with State and local government officials.
    Implementation and execution of the Plan is a responsibility shared 
by the Homeless Veterans Initiative Office (HVIO), Veterans Health 
Administration (VHA), and Veterans Benefits Administration (VBA). VHA 
is responsible for building and executing an operational budget, 
monitoring performance and oversight of regional and local health 
operations. Within the Veterans Health Administration, The National 
Center on Homeless Veterans was created to promote recovery-oriented 
care for Veterans who are homeless or at-risk for homelessness by 
developing, promoting, and enhancing policy, clinical care research, 
and education to improve homeless services. The Center's goal is to 
establish a national forum to exchange new ideas; provide education and 
consultation to improve the delivery of services; and disseminate the 
knowledge gained through the efforts of the its Research and Model 
Development Cores to VA, other Federal agencies, and community provider 
programs that assist homeless populations.
    B. With similar missions, how is VA ensuring that these offices are 
working cohesively together and do not become duplicative in nature? 
What oversight mechanism is in place to ensure funds are being spent in 
an effective and efficient manner?
    Response. The Homeless Veterans Initiative Office (HVIO) has lead 
responsibility to ensure the Plan to Eliminate Veteran Homelessness is 
continually reviewed and revised as needed to achieve the goal of 
ending Veteran homelessness. HVIO provides policy coordination and 
takes the lead in the monthly oversight of the plan by senior VA 
leadership. This oversight includes a monthly Operational Management 
Review meeting chaired by the Deputy Secretary. Topics addressed 
include a detailed review of expenditures in each of the programs that 
constitute the Plan. Both HVIO and VHA Homeless Program leads 
participate, and review specifics related to their program activities. 
Independently of these monthly reviews, the HVIO and VHA Homeless 
Program leads meet weekly both one on one and with a representative of 
the Secretary's office to monitor ongoing program activities and 
address emerging issues. As of February 2011, the HVIO and VHA Homeless 
Programs' physical offices are co-located, facilitating ongoing 
communication and coordination of efforts.

    Question 8. The Office of Research and Development plans to expand 
research on homelessness, focusing specifically on intervention, risk 
factors, health care usage patterns and other areas to assist with VA's 
plan to end homelessness.
    A. How is the HVIO and the National Center for Homelessness among 
Veterans working with the Office of Research and Development to ensure 
that their efforts to end homelessness are not being duplicated? How 
are the HVIO, the National Center on Homelessness among Veterans, and 
the Office of Research and Development ensuring that VA's efforts to 
end and prevent homelessness among veterans are effective?
    Response. The Homeless Veteran Initiative Office (HVIO), the VA 
National Center for Homelessness among Veterans (NCHV) and the Office 
of Research and Development (ORD) are in close collaboration. Efforts 
to address homeless among Veterans in each of these offices are 
discussed at regular meetings with senior leadership.
    The NCHV has worked very closely with ORD, most specifically the 
Health Services Research and Development Office (HSR&D), to create a 
homeless portfolio that would be coordinated with the Federal Strategic 
Plan to Prevent and End Homelessness and with the VA Plan to End 
Veteran Homelessness.
    The ORD recently funded four prominent researchers to study 
homelessness. These studies will inform leadership of the effectiveness 
of VA's efforts to end and prevent homelessness.
    The projects include:

            Homeless Solutions in a VA Environment (H-SOLVE)
          The purpose of this study is to determine whether VA 
        implementation of Housing First can serve the chronic homeless 
        population with serious mental illness.
            Aligning Resources to Care for Homeless Veterans (ARCH)
          The purpose of this study is to evaluate ways to best 
        organize and deliver primary care for homeless Veterans. ARCH 
        will assess 4 different adaptations of the PACT primary care 
        model in a mixed methods study that includes multi-center, 
        randomized-controlled trials of embedded peer-mentoring within 
        different iterations of the PACT model, focus groups of study 
        participants assessing satisfaction, treatment engagement and 
        self-efficacy within the different care models and a cost-
        utility analysis to determine the most cost-efficient approach 
        to organizing care for this population. Findings from this 
        study will help determine optimal care approaches for reducing 
        emergency department visits and acute hospitalizations, 
        increasing patient satisfaction, and improving chronic disease 
        management.
            Population-based Outreach Services to Reduce Homelessness 
                    among Veterans with Serious Mental Illnesses (SMI).
          The purpose and aims of this study are to develop a Navigator 
        outreach program to identify Veterans with SMI and a lifetime 
        history of homelessness to determine whether contact by the 
        Navigator is associated with increased health services use, 
        housing or other social services as well as decreased 
        mortality.
            Addiction Housing Case Management for Homeless Veterans 
                    Enrolled in Addiction Treatment
          This randomized, controlled trial will develop and test a 
        model for homeless Veterans entering addiction treatment with 
        aims of evaluating: (1) addiction treatment with addiction/
        housing case manager (experimental); or (2) addiction treatment 
        with weekly housing group (time and attention control) and 
        assessed for two years to determine if addiction/housing case 
        management results in earlier transition to and higher 
        retention in stable housing among homeless Veterans entering 
        addiction specialty care.

In addition to the above-noted efforts the NCHV and HSRD have funded an 
evidence based treatment manual, Maintaining Independence and Sobriety 
through Systems Integration, Outreach and Networking (MISSION) that can 
assist VA case managers better meet the needs of homeless veterans with 
co-occurring mental health and substance use treatment needs. The ORD 
is also considering funding a trial to study how this evidence based 
treatment manual can be disseminated with the VA Homeless services. 
Additionally, the NCHV and HSRD are evaluating how they can collaborate 
to initiate research related to homeless Women Veterans. The close 
collaboration between the VA National Center and ORD will ensure VA is 
efficiently researching the issues that will be most effective in 
ending homelessness among Veterans.
                              construction
    Question 1. According to a September 2010 GAO report entitled The 
FY 2009 Federal Real Property Report; the Federal Government had 10,327 
excess buildings in FY 2009 with an operating cost of $133.7 million. 
This is an increase of 187 buildings and $600 million in operating 
costs from the fiscal year 2008 report. Across the country, VA has 
about 1,100 buildings that are vacant or underutilized.
    A. Exactly how many excess and underutilized buildings does VA have 
across the country? Please list their previous functions prior to 
abandonment.
    Response. The VA currently estimates we have 895 buildings that are 
vacant or underutilized. Of these approximately 296 are vacant, the 
remaining 599 are considered underutilized, but are still in use 
providing support to Veterans. The underutilized buildings are not used 
at capacity and may not be operating as efficiently as possible, but 
cannot be easily disposed of without consolidating operations to make 
them fully vacant. Below is a breakout of the GSA Usage code for the 
895 vacant or underutilized buildings.

     Number of Vacant and Underutilized Buildings by GSA Usage Code
------------------------------------------------------------------------

------------------------------------------------------------------------
All Other..................................................       198
Dormitories/Barracks.......................................         1
Hospital...................................................        34
Housing....................................................       126
Industrial.................................................        29
Laboratories...............................................        15
Office.....................................................       118
Other Institutional Uses...................................        68
Post Office................................................         1
Service....................................................       154
Storage....................................................         3
Warehouses.................................................       148
                                                            ------------
      Grand Total..........................................       895
------------------------------------------------------------------------


    The VA currently has plans for reuse or disposal of 350 of these 
buildings. After those actions, there will be approximately 96 vacant 
buildings and 451 underutilized buildings remaining in the inventory. 
Many of these buildings are very small (340 of the 545 are <5,000 GSF) 
and have little reuse potential. VA continues to look for consolidation 
opportunities to make available for reuse a portion of the 451 
underutilized buildings, but until consolidation occurs those building 
remain in use providing Veteran services.
    B. When a new construction project is proposed, does VA take into 
account the excess buildings owned by VA?
    Response. Yes. A primary gap used to evaluate the need for 
additional space under SCIP is space. A facilities space gap is 
calculated as the projected space needs to total currently existing 
building space, resulting in either additional space need or excess 
space. In cases of excess space, VISNs are required to reuse or dispose 
of excess space before requesting new construction. This requirement 
ensures that there is a plan for excess space, either renovating to put 
back into service, reusing in other VA administrations, repurposing for 
homeless housing, or disposing of the asset. Each VA administration and 
office is part of the review of each SCIP action plan, providing a 
review for potential reuse opportunities as well.
    C. How many of these buildings can be re-utilized for other 
purposes within VA, and thereby save the taxpayers in construction 
costs?
    Response. Of the currently identified 895 vacant or underutilized 
buildings, 184 are planned for internal reuse or repurposing via VA's 
Enhanced-Use Leasing (EUL) Program. The Building Utilization Review and 
Repurposing (BURR) initiative is a strategic effort to identify and 
repurpose unused and underutilized VA land and buildings nationwide in 
support of the Secretary's goal to end Veteran homelessness. The 
Department's EUL authority allows VA to match supply (available 
buildings and land) and demand among Veterans for housing with third-
party development, financing, and supportive services. Other potential 
reuse opportunities will continue to be explored.
    D. How many of these buildings can be sold to a private entity or 
transferred to another Federal agency?
    Response. There are currently 19 buildings planned for sale or 
transfer. The majority of the buildings with reuse value are being 
repurposed in support of ending Veteran homelessness. The remaining 
buildings are generally being planned for demolition or deconstruction 
due to their size (more than 1/3 less than 5,000 GSF), location, lack 
of reuse potential, or poor condition. For example, many buildings are 
located in the center of VA medical center campuses; such that they are 
not attractive business opportunities for private partners who rely on 
customer traffic that could disrupt patient care.

    Question 2. As stated in your budget justification for 
Construction, VA notes that ``VA has undergone a profound 
transformation in the delivery of health care over the past 20 years.'' 
The VHA infrastructure was developed in a period of time when delivery 
of health care was more in-patient focused. What this left the VHA with 
were capital assets that ``often do not fully align with current health 
care needs.'' (Volume 4, page 2-3.)
    A. What is VA's strategic plan to balance the vast needs in 
infrastructure while taking into consideration the tight budget 
restraints we are operating under?
    Response. VA's strategic plan to balance during budget constraints 
is to focus capital investments on the most critical infrastructure 
needs. Through the Strategic Capital Investment Planning (SCIP) 
process, the most critical needs within the construction (major and 
minor) and non-recurring maintenance programs are funded in priority 
order. VA infrastructure needs are first prioritized against each other 
to develop one integrated list of capital requirements.

    Question 3. In the fiscal year 2012 budget Appendix for 
Construction, Minor Projects, there is a line item titled ``other 
services from non-Federal sources,'' which will be funded at $37 
million in FY 2012. This would be an increase of 131% or $21 million 
from FY 2010 actual and equal to the continuing resolution level.
    A. What accounts for a doubling of this account in one year?
    Response. While the 2012 estimate for this is $21 million higher 
than the 2010 actual, it is important to note that the 2012 request is 
actually $10 million less the 2009 actual.

        2009 Actual:  $47 million
        2010 Actual:  $16 million
        2011 Estimate:  $37 million
        2012 Estimate:  $37 million

Actual spending year to year can vary depending on the requirements, as 
well as the timing, of the actual construction schedules. The estimate 
for 2011 and 2012 is equal to the average of the last 4 years of 
actuals for this activity.
    B. Please explain what services are being provided to the Federal 
Government under this line item?
    Response. This line item largely consists of contracts for 
maintenance, certification, inspection, repair of equipment and land 
planning associated with construction contracts.

    Question 4. VA has an unfunded liability in medical construction 
which seems to grow larger every year. Currently, this backlog stands 
at roughly $6 to 8 billion in projects waiting for funding. 
Simultaneously, the costs of individual projects are also increasing, 
with the current estimate of the VA hospital in New Orleans at just 
under $1 billion.
    A. What is VA's strategic plan to secure funding for individual 
projects in order to get this list to a more manageable size?
    Response. VA is comprised of over 5,000 buildings and 30,000 acres. 
VA infrastructure needs are prioritized against each other to develop 
one integrated list of capital requirements and construction requests 
are also weighed against other VA priorities to determine the 
appropriate level of funding each fiscal year. In order to maximize 
resources, and fund additional projects, VA requests funding for 
larger, individual projects in phased sections. Each phase is a stand-
alone project or phase that can be obligated within the fiscal year of 
request, without any extenuating circumstances.
    B. How has VA taken into account the long term patient demand 
projection and needs when considering what types of facilities to build 
and where?
    Response. VA relies on the Enrollee Health Care Projection Model 
(EHCPM) to project the demand for care by specific categories of care 
over a 20-year planning horizon. The EHCPM is an actuarial model that 
is updated each year that takes into account Veteran demographics and 
illness complexities to project long-term patient demand for inpatient 
and outpatient care. The EHCPM uses previous utilization and referral 
patterns to inform VA on health care demands based on where enrollees 
live and which VA facilities they will likely go to for care. In making 
long-term projections, the EHCPM takes into account Veteran reliance on 
VA vs. non-VA care, and incorporates the same assumptions as other 
Federal agencies regarding future discharges of Iraq and Afghanistan 
Veterans.
    The EHCPM projections serve as the foundation for VHA's Health Care 
Planning Model (HCPM). Veterans Integrated Service Networks (VISN) use 
the HCPM's standard methodology to systematically analyze gaps between 
current and projected demand for care in each market over the next 
five, ten, and twenty years to plan strategic initiatives to best 
address the anticipated gaps in services. This information is then used 
to inform what types of facilities VA will need in the future, as well 
as well as where they should be built. VA's rigorous planning ensures 
that Veterans receive the highest quality care in the most appropriate 
locations for inpatient and outpatient environments.
    C. Has VA performed a business case study on the benefits of 
leasing or buying to consider the long term needs of VA to ascertain 
which would be more financially advantageous to VA? If so, what were 
the results?
    Response. Many factors are evaluated when considering leasing or 
buying. An example of some factors include, the need for additional 
space, the capacity to build on medical center campuses or renovate 
existing buildings, the requirement for quick implementation or 
flexibility to terminate a contract, budget constraints, the most cost 
effective alternative, all go into the buy versus lease determination. 
Each acquisition decision is considered and reviewed on an individual 
basis.
    VA Policy, the OMB A-11, Capital Programming Guide and OMB A-94 
requires a detailed cost benefit analysis be completed for all Major 
initiatives. The VA Strategic Capital Investment Planning (SCIP) 
process expanded this requirement to all capital initiatives via a 
cost-effectiveness analysis (CEA). The CEA provides a life cycle cost 
comparison of alternatives including: build, renovate, lease, and 
contract out for services. A cost effectiveness analysis must be 
completed for each capital solution to compare costs and provided as 
part of a completed business case application.
    In addition, each business case is required to conduct an 
alternatives analysis, including a comparison of the net present value 
(NPV) of four options: status quo; construct new/renovate; lease space; 
and contract out services. Project business case applications are 
scored and ranked on several SCIP Criteria, one of the main criterion 
is called the ``Best Value Solution,'' which provides an analysis of 
which option has the best net present value (NPV). If the chosen option 
does not have the best NPV, an explanation of why it is the chosen 
option is required.
                       information and technology
    Question 1. The Office of Information and Technology (OI&T) has 
asked for an increase of $25.8 million over fiscal year 2010 levels for 
Research and Development (R&D). The VA has 16 Major Transformational 
Initiatives to improve collaboration and integration among the various 
VA departments. The R&D initiative focuses on the genomic medicine, 
point of care research, medical informatics and Information Technology 
(IT) and VA Central Office field research.
    A. What accounts for a $25.8 million increase in two years?
    Response. The Research & Development transformational initiative 
receives funding from the Medical and Prosthetics research budget for 
business needs and the Office of Information and Technology (OI&T) for 
IT needs. Fiscal Year 2010 is the baseline for this question so it is 
important to state that in Fiscal Year 2010, Research & Development did 
not receive any transformational initiative funds from either the 
business or OI&T budgets. Hence, all subsequent transformational 
initiative funds appear as an increase in funding. In Fiscal year 2011, 
$17.1 million of OI&T funding is budgeted, pending congressional 
action, to fund the following: the Veterans Affairs Research and 
Development lead role in personalized medicine, including the Million 
Veteran Program and the Genomic Informatics System for Integrative 
Science [GenISIS]; comparative effectiveness research [Point of Care 
research]; new tools to mine VA electronic medical records to optimize 
strategies for Veteran care, including Veterans Affairs Informatics and 
Computing Infrastructure [VINCI] and Consortium for Healthcare 
Informatics Research [CHIR]; and new tools to improve research 
administrative oversight while decreasing costs in the future, 
including the Research Administrative Management System [RAMS]. The 
Fiscal Year 2012 funding level is forecast at $30 million from OI&T 
funding and $0 from business funding.
    B. How much in total will be expended on this initiative?
    Response. Outyear funding levels for this initiative will be 
developed as future needs are analyzed.

    Question 2. Assistant Secretary Baker recently informed the Hill of 
OI&T's intention to hire 705 new employees. According to a spreadsheet 
provided to Committee staff on February 14, 2011 (copy attached), it 
appears that a substantial amount of these employees are to be located 
in the Washington, DC, area or VA Central Office. Please reconcile the 
staffing levels outlined in that document with the staffing levels 
requested in the fiscal year 2012 budget request.

[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]


    Response. OI&T request for FY 2012 does not request an increase in 
FTE. OI&T is currently understaffed and faces employment turnover rates 
of about 10%. The effort to hire 705 new employees is intended to bring 
staffing levels to where they should be. This effort would get OI&T 
hiring on track, not increase FTE.

    Question 3. The Virtual Lifetime Electronic Record (VLER) is one of 
the President's initiatives for VA/DOD. According to the fiscal year 
2012 budget request: ``Both VA and DOD have agreed that the objective 
for VLER is to establish a coherent, lifetime electronic record that 
will capture Servicemember/Veteran information from accession into 
military service to interment and until the last benefit is 
administered. VLER will include all information necessary to provide 
medical care, services, benefits, and compensation to the Veteran, 
eligible family members, or eligible beneficiaries.''
    A. What steps will be or have been taken by VA to improve upon the 
program, as recommended in the February 2011 GAO Report on Electronic 
Health Records?
    Response. The Virtual Lifetime Electronic Record (VLER) program has 
often been so closely linked to the Electronic Health Record (EHR) 
modernization initiative as to become synonymous. It is important to 
understand that VLER is closely aligned with but unique from the EHR 
initiative. VLER is an interoperable and communication environment 
where by health, benefits and administrative information may be 
electronically accessed by every Servicemember, Veteran and/or their 
beneficiaries. The VLER environment is structured to support the secure 
exchange of health, benefits and administrative information between 
public and private partners. Health, benefits and administrative 
information resides in many DOD and VA systems. VLER ensures that 
regardless of the information source, policies, regulations, and 
procedures are put into place to secure and protect the information 
accessed or exchanged, and the terminologies, definitions, and terms 
are clearly presented.
                    national cemetery administration
    Question 1. The budget request for fiscal year 2012 under 
Operations and Maintenance for Other Services is $86 million. Please 
provide a detailed itemized list of how these funds would be spent 
during fiscal year 2012. To the extent that these funds will be spent 
on contracts, please explain the nature of the contract and the 
expected outcomes.
    Response. The following chart provides a list of projects funded 
under Other Services:


----------------------------------------------------------------------------------------------------------------
                                             Cost
                 Category                    ($M)                            Description
----------------------------------------------------------------------------------------------------------------
National Shrine Projects..................   $32.9  Contracts to raise, realign, and clean headstones/markers
                                                     and repair sunken graves.
----------------------------------------------------------------------------------------------------------------
Road and Grounds Maintenance..............    33.6  Contracts to maintain and repair roads, sidewalks, and other
                                                     property. Contracts for mowing and trimming, snow removal
                                                     from streets and sidewalks, and tree pruning.
----------------------------------------------------------------------------------------------------------------
Non-Recurring and Recurring Maintenance        2.5  Contracts to maintain and repair buildings and other
 and Projects.                                       structures.
----------------------------------------------------------------------------------------------------------------
Equipment Maintenance.....................     0.5  Maintaining and repairing cemetery and office equipment.
----------------------------------------------------------------------------------------------------------------
Operational and Other Services............    12.7  Contractual services for cemetery operations, including
                                                     security services, trash removal, and pest control.
                                                     Contractual services for customer satisfaction surveys.
                                                     Also includes payments to other VA staff offices for
                                                     centralized support activities and to the Defense Finance
                                                     and Accounting Service for payroll processing costs.
----------------------------------------------------------------------------------------------------------------
Janitorial Services.......................     1.4  Contracts for janitorial and cleaning services.
----------------------------------------------------------------------------------------------------------------
Compensated Work Therapy..................     0.8  Payments made for participation in the Compensated Work
                                                     Therapy program.
----------------------------------------------------------------------------------------------------------------
Franchise Fund Payments...................     0.7  Payments based on service level agreements for centralized
                                                     financial services and security services (background
                                                     investigations, ID badges, etc.).
----------------------------------------------------------------------------------------------------------------
Employee Relocations......................     0.5  Payments for storage of household goods and relocation
                                                     services.
----------------------------------------------------------------------------------------------------------------
Training..................................     0.4  Tuition for attendance at training courses.
----------------------------------------------------------------------------------------------------------------
  Total...................................   $86.0  ............................................................
----------------------------------------------------------------------------------------------------------------


    Question 2. In Volume III page 1B-10, there is a chart entitled 
``Employment Summary-FTE by Grade.'' The request for fiscal year 2012 
for SES employees is 11, an increase of 4 SES employees over fiscal 
year 2011 and an increase of 7 over fiscal year 2010.
    A. Please explain why the National Cemetery Administration (NCA) 
needs 4 additional SES level employees.
    Response. The new SES positions reflect the growing scope and 
complexity of NCA operations. We are not requesting any additional 
funding or FTE for the positions.
    Five of the seven positions are for our regional office directors. 
Workload has increased considerably in the field. For example, in the 
last decade NCA has opened 15 new national cemeteries, a national 
training center, and a national scheduling center.
    Another of the new positions is for the Memorial Program Service 
director. In FY 2010, this office processed nearly 400,000 headstone/
marker applications and over 800,000 Presidential Memorial 
Certificates. Its responsibilities have expanded to include the First 
Notice of Death function and the new medallion benefit.
    The final position restores an SES management slot that was 
available to NCA prior to FY 2010.
    B. What functions will they perform?
    Response. These new positions are necessary to reflect current 
management requirements and will ensure the recruitment and retention 
of top managers.

    Question 3. For fiscal year 2012, the amount requested for travel 
for NCA is the same as the current expected travel expenditures during 
fiscal year 2011, over $2.7 million. How often do and how many people 
are eligible for travel?
    Response. NCA's 2012 travel budget is straight-lined from the 2011 
request, despite increased costs associated with all modes of 
transportation. NCA is a national organization with 131 cemeteries in 
39 states and Puerto Rico; oversight of grants made to states for state 
Veterans cemeteries in 38 states, Guam and Saipan; a national training 
center; and a national scheduling center. Travel funding is critical to 
ensure appropriate operational oversight, training, and organizational 
communication. Employee travel is approved based on program and 
training requirements. Approximately 480 NCA employees travel in a 
year. Some employees travel once a year, while others travel several 
times a year.

    Question 4. In Volume III page 1B-15, the explanation for the 
budget line Transportation of Things reflects that ``costs include the 
transportation of household goods as part of permanent change of 
station moves of transferring employees.'' For fiscal year 2012, what 
percentage of the Transportation of Things budget would be used for 
employee relocation costs?
    Response. In FY 2012, an estimated 26 percent of the Transportation 
of Things budget line will be used for employee relocation costs.
                                 ______
                                 
       Response to Posthearing Follow-up Questions Submitted by 
        Hon. Richard Burr to U.S. Department of Veterans Affairs
    Question 1. Question 1 regarding VA's Housing program asked VA to 
explain why the Housing program was projecting to spend $790,000 more 
on Other Services during fiscal year 2011 than VA had originally 
requested for Other Services for that fiscal year. In response, VA 
indicated that ``Payroll savings from elimination of the 2011 pay raise 
were realigned to Other Services to fund a job task analysis for loan 
production specialists.''
    a. Was the purpose of the pay freeze to reduce the deficit and, if 
so, is this use of funds consistent with that purpose?
    Response. The President's memorandum of December 22, 2011, 
regarding the freezing of Federal employee pay schedules states its 
purpose, ``as the first of a number of difficult actions required to 
put our Nation on a sound fiscal footing.'' The 2011 estimates included 
in the 2012 budget reflect the Department's best estimates consistent 
with the guidance and funding levels appropriated to the Department by 
Congress in the Continuing Resolution in effect at that time.
    b. How much in total does VA expect to realize in payroll savings 
during fiscal year 2011?
    Response. The 2011 advance appropriation for VA medical care 
included $237 million for the employee pay raise, and $49 million of 
this amount was rescinded in Public Law 112-10. VBA reallocated $16 
million in pay savings across all business lines. Those allocations 
were primarily for contract services to improve delivery of benefits 
and services to Veterans. All other payroll accounts were ultimately 
funded at the 2010 level by Public Law 112-10, which did not include 
funding for an employee pay raise and was at levels substantially lower 
than the 2011 President's Budget request; thus, there are no other 
payroll savings in 2011.
    c. VA-wide, how much in total of the fiscal year 2011 payroll 
savings were realigned for other purposes?
    Response. Please see the response to 1.b., above.
    d. Please provide a detailed account of how any payroll savings 
expected to be realized in fiscal year 2011 have been or will be spent.
    Response. Please see the response to 1.b., above.

    Question 2. Under the category ``General,'' question 5(D) asked VA 
whether the fiscal year 2012 budget includes funding for benefits that 
are projected to be overpaid and not recouped. In part, VA responded: 
``In the calculation for the FY 2012 President's Budget request, the 
Readjustment Benefits account is projecting a net increase of $7.2 
million in obligations associated with overpayments. This projection is 
based on historical trends and updated each budget cycle.'' (Emphasis 
added.)
    a. What is the total amount included in the Readjustment Benefits 
account for fiscal year 2012 associated with overpayments?
    Response. The total cumulative overpayments for the Readjustment 
Benefits account are estimated to be $390.7 million at the end of 
fiscal year (FY) 2012. This cumulative amount includes overpayments 
from prior fiscal years.
    b. Please explain the relevant historical trends over the past 5 
years.
    Response. From FY 2006 to FY 2009, the cumulative overpayments 
ranged from $111 million to $121 million for the Readjustment Benefits 
account. Cumulative overpayments increased to $375 million FY 2010, 
primarily resulting from one-time advance education payments, most of 
which have already been recouped. The estimated FY 2012 overpayments of 
$390.7 million are also cumulative. Overpayments occur more frequently 
and in larger amounts under the Post-9/11 GI Bill program because of 
the way the program is designed. Tuition and fee payments are made at 
the beginning of the academic term, often before students have adjusted 
their courses. For example, if a student withdraws from a course after 
VA issued a payment, an overpayment is created. When changes like this 
occur, overpayments are unavoidable. While adjustments like this are 
inherent in the program, overpayments may be collected in the future 
and are not identified as funds that VA does not expect to recoup.

    Question 3. Under the category ``General,'' question 5(E) asked 
whether any performance measures for regional office personnel take 
into account the amount of unrecovered benefit overpayments 
attributable to their errors. VA responded that ``VA systems do not 
track this information.''
    a. Will any planned technological improvements include the ability 
to track this type of information? If so, when will this type of 
information be available?
    Response. Almost all compensation and pension awards have been 
converted to VETSNET. Currently, no adjustment reasons exist in VETSNET 
to record administrative error awards or the adjustment period. 
Compensation Service is developing new business rules that will allow 
award adjustments due to administrative errors to be specifically 
identified. These changes will be part of future VETSNET Awards 
releases targeted for 2012.
    The goal of this VETSNET Awards design change is to add details 
regarding any amount of benefits incorrectly paid for a specific 
period.
    b. In the meantime, what steps will VA take to hold employees 
accountable for unrecoverable overpayments resulting from their errors?
    Response. Secretary Shinseki has set an aggressive goal to achieve 
98 percent accuracy for all rating decisions by the end of FY 2015. 
Compensation Service is dedicated to meeting this aggressive goal for 
our Veterans. However, due to the complexity of the claims process, 
there will always be a certain number of human errors.
    Currently, errors are tracked through historical data collection in 
our computer applications and through claims quality assurance provided 
by Systematic Technical Accuracy Review (STAR). STAR reviews individual 
claims and identifies employee errors using established VA employee 
performance standards for Veterans Service Representatives, Rating 
Veterans Service Representatives, and Decision Review Officers. As part 
of these reviews, STAR identifies specific errors in claims processing 
so individual employees may receive additional training and guidance in 
those specific areas. STAR reviews also examine administrative 
decisions and the approval process for those decisions, which may 
include possible overpayments. Compensation Service is dedicated to 
meeting the Secretary's goal for accuracy by providing the best 
possible training and guidance for our VA employees, both collectively 
and as individuals.

    Question 4. Under the category ``Compensation and Pension,'' 
questions 22(A) and (B) asked VA about an initiative to extend routine 
future disability examination requests to five years. In response to 
those questions, VA indicated that it does not have information about 
how often these types of examinations reveal a change in the veteran's 
level of disability or about how many veterans would potentially be 
overpaid or underpaid as a result of this initiative. Please explain 
what factors were considered in determining to move forward with this 
initiative.
    Response. In 2010, Compensation Service issued Fast Letter (FL) 10-
14, Procedural Change Regarding Routine Future Examinations, which 
modified Compensation Service claims-processing procedures for 
scheduling Veterans' routine future examinations. Routine future 
examinations are now scheduled at five-year intervals instead of two-
year intervals. Factors considered in determining to move forward with 
this initiative included:

     Eliminating over 80,000 routine future examinations over 
the course of three years; and
     Freeing resources to improve the timeliness of processing 
of other Veterans' claims.

    Question 5. Under the category ``Board of Veterans' Appeals,'' VA 
was asked in question 5 about VA's publication of an annual Veterans 
Law Review. VA indicated that ``employees who contribute [to the Law 
Review initiative] do so largely on their own time'' (emphasis added). 
In response to questions on VA's fiscal year 2011 budget request, VA 
indicated that ``[a]pproximately 70 attorneys and Veterans Law Judges 
volunteer their non-duty time to edit and publish the Veterans Law 
Review each year'' (emphasis added).
    a. Please clarify whether employees of the Board of Veterans' 
Appeals use duty-time to perform activities related to the law review.
    Response. Employees of the Board of Veterans' Appeals do not use 
duty time to perform writing or editing for the Veterans Law Review 
(VLR); all writing and editing is voluntary and is conducted on non-
duty time.
    With respect to other VLR activities, to include planning meetings 
and forms/citations training, the use of duty time is nominal to none, 
as these activities are largely scheduled during non-duty time. 
Approximately 5 times per year, the lead team of VLR editors, which 
consists of approximately 10 individuals, must meet to discuss 
scheduling, the selection of pieces for publication, and other issues 
that may arise, for which the Board provides meeting space. The three 
supporting teams of editors, consisting of the remaining 60 volunteers, 
must also meet approximately 2-3 times during the year. Finally, VLR 
provides a forms and citation training once annually. VLR is committed 
to scheduling these meetings and the training during non-duty time, 
e.g., during lunch breaks, although, at times, these activities may 
carry over to or fall within duty time for brief periods.
    b. If so, how much time on an individual and total basis do VA 
employees devote to this activity?
    Response. The approximately 70 employees involved with the VLR 
spend no hours of duty time on writing or editing for the VLR. With 
respect to the other VLR activities, the 10 lead editors devote no more 
than 5-6 hours annually to their meetings, and the three supporting 
teams of editors devote approximately 1-2 hours annually to their 
meetings. The forms and citations training is conducted over a 1 hour 
period annually. As noted above, nominal to no duty time is devoted to 
the VLR, as the activities are to be scheduled for non-duty time, 
although, on occasion, these activities may briefly carry over to or 
fall within duty time.

    Question 6. Under the category ``General,'' VA was asked in 
question 2 about the sentiment from the Commission on Fiscal 
Responsibility and Reform that ``[e]verything has to be on the table'' 
with regard to fiscal reform. VA's response indicated that, ``[i]n the 
past two years, we have established and created management systems, 
disciplines, processes, and initiatives that help us eliminate waste.''
    a. How much has VA saved as a result of these ``management systems, 
disciplines, processes, and initiatives?''
    Response. Please see the chart below for an accounting of the 
estimated savings included in VA's budget submission. Descriptions that 
further detail each item are included in Volume 2 of VA's congressional 
budget submission beginning on Page 1A-14.

[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]


    b. Did the funds realized from these savings go to deficit 
reduction? If not, for what purposes were these funds realigned?
    Response. The estimated savings identified above are a vital 
component of VA's multi-year budget planning, and contribute to deficit 
reduction efforts.

    Question 7. In the category ``Office of Human Resources and 
Administration,'' VA was asked in question 1(C): ``What metrics are 
used to determine which staff needs to travel?'' VA responded:

    Response. Our travel cost is executed against [VA Learning 
University (VALU)] sponsored training programs derived from a 
requirements process that identifies critical training needs and fills 
training gaps identified by the VA Administration(s) and VA Staff 
Offices. VALU also provides training to the field in centralized 
locations where there are areas of high concentration of VA employees 
allowing for a reduction in expected travel that would have been 
incurred to support the training efforts.
    When it is necessary for staff to travel, what metrics are used to 
determine which staff needs to travel?
    Response. VALU provides training venues and travel resources to 
support the Veterans Affairs mission and business objectives through 
high quality, continuous learning, development that enhances 
leadership, occupational proficiencies, and personal growth. 
Individuals are designated for training based on individual development 
plans (IDP), specific functional training needs identified by 
department or administration and also may select cross cutting core 
competency training and leadership training which collectively address 
most of the VALU portfolio. The number of training events offered by 
VALU depends on several factors including courses identified through 
the requirements process, technical training conferences, 
transformational leadership and supervisor/manager training needs. 
Total course load is built based on resourcing and need. Individuals 
fill the available seats by registering thru Talent Management System 
and getting supervisor approval. The number of train
ings an individual may attend is based on availability and approval. 
Total number of individuals training during a year is compared to 
targets set by leadership. Technical training conferences and 
leadership training typically require face to face training which 
dictates travel. Increasingly VALU is introducing virtual training and 
social media to reduce need for travel.

    Question 8. Also in the category ``Office of Human Resources and 
Administration,'' VA was asked in question 5(C) about the effectiveness 
of the Health and Wellness initiative in ``promoting healthier 
employees.'' VA stated that the program is still in the baseline year 
and the program's effectiveness will be evaluated in six months and at 
the end of the fiscal year. What metrics will be used to determine if 
the program is ``promoting healthier employees?''
    Response. While still in the baseline year, during the past six 
months VA Wellness Is Now (WIN) has implemented several aggressive 
promotional campaigns, organized a national event, and developed 
partnerships with the national unions, nursing services and the 
National Partnership Council. Metrics used to evaluate the program come 
from the online database which tracks many key elements such as health 
risks (smoking, obesity, hypertension and others). There has been a 
steady rise in completion of the online Health Risk Assessment (HRA) 
with 30,000 employees completing them (11% of the VA population, up 
from 5% in the last quarter). VA WIN's first national ``2K Walk & 
Roll'' event, which was led by the VA's Deputy Secretary, had 155 sites 
and over 16,847 employees participating in the event. VA WIN has 
developed useful ``tools'' for employees such as guidebooks to help 
motivate, get employees exercising and moving and to support their 
emotional well-being. A new satisfaction survey is being added to the 
database so we can better evaluate if the program is meeting our goals 
for employee satisfaction and promoting healthy employees. A complete 
update on the program will occur at the end of the fiscal year 
incorporating all elements of VA WIN.

    Question 9. Under the category ``Office of Public and 
Intergovernmental Affairs,'' VA was asked in question 1(B): ``What 
indicators would suggest whether additional staffing increases are 
warranted?'' VA responded:

        The new employees will be supporting the Office of Tribal 
        Government Relations; Paralympic Program Office; Homeless 
        Veterans Initiatives and Outreach Program offices.

Please clarify what indicators VA uses to determine whether additional 
staffing increases are warranted for this office.
    Response. The National Veterans Outreach Office (NVO) was 
established within the Office of Public and Intergovernmental Affairs 
in 2010. NVO's mission is to assess, standardize and coordinate 
outreach activities for the entire Department of Veterans Affairs. The 
office is developing outreach plans, web resources and training to 
assist VA administrations and program offices in unifying outreach 
communications through clear, accurate, consistent and targeted 
messaging. The Office is also providing project management of 
significant marketing and advertising contracts to ensure Veterans and 
their families are aware of benefits and services, and is working to 
develop a system to track department-wide performance measures for VA's 
outreach programs. In addition, the office is responsible for 
coordinating an annual Outreach summit; the report on the outcomes of 
VA outreach programs to the Secretary of Veterans Affairs, Congress, 
Veterans Service Organizations, and other interested stakeholders, and 
the American people.
    When NVO was initially set up, the Office was authorized a total of 
three FTE which include a GS-15 director; a GS 13/14 Program 
Specialist, serving as deputy director; and a GS 12/13 program 
specialist. It has quickly become apparent that the size and complexity 
of the office's workload is greater than initially anticipated. 
Departments and offices throughout VA are relying on NVO for support, 
approvals and advice for their advertising and marketing initiatives, 
and Members of Congress, the news media and others are expecting 
considerable information about VA's outreach efforts--frequently with 
short turnaround times. Because much of this information is both time-
sensitive and proprietary to the enterprise, it should not be provided 
by contractors, but only by VA staff. In addition many of the decisions 
and recommendations NVO has been required to make cannot be delegated 
to contractors. The two existing staff members are working tirelessly 
to ensure all deadlines and expectations are met, however, once many of 
these plans are implemented, the workload will grow exponentially.
    The VA Parlaympic Office is responsible for the monthly allowance 
to Veterans who are eligible and meet the qualifications. To process 
these applications the VA must work closely with the United States 
Olympic Committee (USOC) and Veterans Benefit Administration. This 
requires checks and balances to ensure that claims are processed in a 
timely manner and meet the intent of the law. This not only requires 
working with VBA but also the Veteran athlete and the coaches at the 
USOC. The VA Paralympics Program Office needs to verify that the 
Veteran is training on a daily/weekly basis and meets the standards set 
forth by USOC and its governing bodies to be a Paralympic athlete. The 
VA Paralympic Program office also manages the grant program that was 
established by Pub. L. 110-389. This requires that the office ensures 
that the grants are administrated in accordance with VA and other 
Federal regulations.
    The Office of Tribal Government Relations (OTGR) engages in 
intergovernmental efforts focused on increasing American Indian and 
Alaskan Veterans' access to health care and benefits (enrollment, 
interagency collaboration for health care service delivery), promoting 
economic sustainability through outreach focused on awareness of 
Veteran-owned small business opportunities, the Native American Direct 
Home Loan program, the Post-9/11 GI Bill, and facilitating increased 
access to compensation and benefits. OTGR has a geographically, 
culturally and politically diverse mandate to work with 565 distinct 
political entities. American Indians and Alaska Natives serve in the 
United States military at a rate higher than any other ethnic group. 
Estimates are that of 1% of the US population are Veterans while 
approximately 15% of American Indians and Alaska Natives are Veterans. 
There are 565 federally recognized Tribes located in 38 states. The 
increase in FTEs would enable VA to expand its responsiveness in 
developing intergovernmental relations with tribal governments and 
improve efforts to extend VA's reach to Veterans living in Indian 
Country, much of which is located in rural or remote areas.
                                 ______
                                 
  Response to Posthearing Questions Submitted by Hon. Mark Begich to 
                  U.S. Department of Veterans Affairs
    Question 1. As you continue to focus more on rural veterans and 
their unique needs. I wanted to stress to you the Alaska Native Health 
Care system. They have hospitals and clinics in very remote areas in my 
state and are very willing to provide health care and provide space for 
VA. I know your Department is working on the MOU with tribes. What is 
the status of the MOU and is it ready to be negotiated with the Alaska 
Native health entities?
    Response. The VA-IHS Memorandum of Understanding (MOU) was signed 
by Dr. Robert Petzel, Under Secretary for Health, and Dr. Yvette 
Roubideaux, Director, Indian Health Service, on October 2, 2010. A 
number of areas are addressed in the MOU, including improving the 
delivery of care by sharing programs, increasing access to services and 
benefits, improving coordination of care, and increasing efficiency 
through sharing contracts and purchasing agreements. The MOU also 
focuses on the joint development of applications and technologies, as 
well as the implementation of new technologies such as tele-health. 
Additionally, this agreement focuses on increasing the quality of care 
through training and workforce development, attention to cultural 
competency, joint credentialing of staff, and sharing of contingency 
planning and preparedness efforts for emergencies and disasters. In 
order to accomplish the main goals of the MOU, 12 work groups have been 
established that have representation from both the VA and IHS. All of 
the work groups have met and most have developed action items and 
timelines for accomplishing their items. An implementation work group, 
led by Dr. Mary Beth Skupien, Director, Office of Rural Health, and a 
yet to be determined designee from IHS, will meet soon to discuss the 
submitted action items and procedures for administering the work 
groups. At this time, the MOU can be used in negotiations with Alaska 
Native health entities.

    Question 2. Last February, I conducted Veterans' Affairs Committee 
hearing in Alaska, we heard from the VSO's about the time it was taking 
to get a response. Are you continuing to Broker the ratings to other 
states? I am hearing that this is still causing delay and hardship for 
veterans waiting for their benefits.
    Response. The Anchorage Regional Office is currently brokering out 
claims for service-connected compensation benefits to the Salt Lake 
City, UT, and Ft. Harrison, MT, VA Regional Offices. Between the two 
offices, cases are brokered at a rate of approximately 145 per month. 
Anchorage has experienced a 32 percent increase in its pending workload 
since the beginning of FY 2011. Comparatively, the nationwide inventory 
has increased by 49 percent. These increases are due in significant 
part to the Secretary's decision to add three additional disabilities 
to the list of conditions presumed to be related to Agent Orange 
exposure for Veterans who served in the Republic of Vietnam. VA 
anticipates that as the Agent Orange-related claims are completed, both 
in Anchorage and nationwide, VA will reduce the pending inventory.

    Question 3. As you are aware, VISN 20, more specifically Alaska has 
had a rural demonstration pilot project for outreach to rural veterans. 
Object of pilot was to reach veterans and inform them about veteran's 
benefits. The pilot was pulled to reaccess, focus groups were 
conducted, I have asked for the report and what the follow up will be 
on getting these vets information. Will you please tell me the status 
of the pilot in Alaska?
    Response. The pilot was not pulled, but concluded at the end of FY 
2010. The Veteran Focus Groups were completed in August 2010, and the 
report was received in September 2010. As a result of the August 
Congressional Delegation visit, it was determined that focus groups 
should also be conducted with the vendors. These were completed in 
December 2010, and the final report was received in late January 2011 
evaluating both Veteran and provider results. Alaska leadership has met 
with the Director of the Alaska Area Native Health Service, IHS, DHHS 
and the CEO of the Alaska Native Tribal Health Consortium to begin a 
consultative process for the next steps to provide services to Alaska 
Native rural Veterans. In addition, a meeting is scheduled with the 
President/CEO of the Alaska Native Health Board which has experience 
with conducting tribal consultation between Federal and tribal 
entities. The report that you requested was forwarded to your staff via 
e-mail on March 10, 2011.

    Question 4. VISN 20 is one of the fastest growing VISNs, our 
facilities in Alaska are seeing an increase in use, does the budget 
take into account the growing population of veterans and does the VISN 
believe that they have the adequate resources to serve Veterans?
    Response. As the table indicates, both VISN 20 and Anchorage have 
higher growth than the VHA average when comparing unique patient growth 
from January 2010 to January 2011.

                      January 2010 to January 2011
------------------------------------------------------------------------
                                          % Change in Unique Veterans
             Access Point                            Served
------------------------------------------------------------------------
VHA..................................                             2.20%
VISN 20..............................                             4.80%
Anchorage............................                             3.90%
------------------------------------------------------------------------

    The VHA budget takes into account the growing population of both 
Alaska and VISN 20. The FY 2011 Alaska operating budget was 
supplemented over $18M ($10 million from VHA; $8 million transferred 
internally from VISN 20) due to Alaska's purchased care cost structure. 
With this additional support, VISN 20 leadership believes it has 
adequate resources to serve Alaska's Veterans for FY 2011. However, 
with increased referral to the local community in the provision of 
oncology and other specialty care in the last few months, VISN 20 is 
currently evaluating what additional resources will be necessary to 
sustain this care in future years.

    Question 5. My question is regarding the HUD VASH vouchers and the 
need to look at increasing them. In our newest CBOC in Juneau, there is 
a need for VASH vouchers; I am told they do not have a case manager to 
manage the vouchers. I recently cosponsored a Bill that will give the 
Secretary authority to contract with non-profits to conduct the case 
management. The pilot in DC seems to be a good example. Can you tell me 
what the obstacles are in utilizing legitimate non-profits and tribal 
agencies in supplying the needed case management?
    Response. VA is able to contract with local organizations to ensure 
that homeless Veterans receive case management services. There are a 
few obstacles in utilizing outside agencies to provide case management 
services:

     In some geographic areas, particularly rural areas, VA 
medical centers are having difficulty finding viable partners to 
contract with for case management services.
     Ensuring that contract agencies have the same 
qualifications and meet the same performance standards as VA employees, 
that the services they provide are comparable to VA's, and that 
prospective community partners are knowledgeable about VA treatment and 
benefit services.

    Question 6. What can Congress do to help you eliminate the benefits 
backlog?
    Response. Congressional support of VA's FY 2012 budget request is 
essential to achieving our goal of eliminating the claims backlog. 
Funding is requested to support critical Claims Transformation 
initiatives designed to streamline our business processes and develop 
and deploy powerful 21st century IT solutions to simplify and improve 
claims processing for timely and accurate decisions. The cornerstone of 
VA's Claims Transformation Strategy is the Veterans Benefits Management 
System (VBMS). VBMS integrates a business transformation strategy to 
address process and people with a paperless claims processing system. 
Combining a paperless claims processing system with improved business 
processes is the key to eliminating the backlog and providing Veterans 
with timely and quality decisions.
    VA's 2012 budget request also includes funding for the Veterans 
Relationship Management (VRM) initiative, another of VA's major 
transformation initiatives. VRM will provide Veterans, their families, 
and survivors with direct, easy, and secure access to the full range of 
VA programs through an efficient and responsive multi-channel program, 
including phone and Web services. VRM will provide VA employees with 
up-to-date tools to better serve VA clients, and empower clients 
through enhanced self-service capabilities.
    As the incoming volume of claims continues to rise, it is also 
vitally important that Congress appropriate funds to support VBA's 
requested FTE level of 20,321. The disability claims workload from 
returning war Veterans, as well as from Veterans of earlier periods, is 
increasing each year. Annual claims receipts increased 51 percent when 
comparing receipts from 2005 to 2010 (788,298 to 1,192,346). We 
anticipate claims receipts of nearly 1.5 million in 2011 (including new 
Agent Orange presumptive claims) and more than 1.3 million in 2012.
    Funding to support the requested FTE level and these innovative 
systems and initiatives will put VA on a path to achieving our ultimate 
goal of no Veteran waiting more than 125 days for a quality decision on 
his/her claim.
                                 ______
                                 
  Response to Posthearing Questions Submitted by Hon. Mike Johanns to 
                  U.S. Department of Veterans Affairs
    Question 1. My state staff often deals with veterans who have been 
waiting in the appeals process for over five years. These veterans are 
typically pre-9/11 veterans, with many from the Vietnam era. It appears 
that regional offices have specific goals for processing initial 
claims, but no such metric seems to exist for claims in the appeals 
process. Does the Department of Veterans Affairs establish singular 
management responsibility for a claim once it enters the appeal 
process?
    Response. Regional Offices have nationally established goals for 
different stages of the appeals process. Goals are set in the following 
areas:

     Notice of disagreement (NOD) inventory: The total number 
of NODs pending at the end of the month.
     NOD average days pending: The average number of days from 
receipt of the NOD to current end of month.
     Form 9 timeliness: The average number of days from receipt 
of a substantive appeal until certification to the Board of Veterans' 
Appeals (BVA).

Achievements under these goals are measured and included in the 
regional office directors' yearly performance evaluations.
    To ensure direct management responsibility for the appeals process, 
each regional office has a team of employees dedicated to processing 
the appeals workload. The composition of the local appeals team may 
vary, but typically includes Decision Review Officers (DRO), Rating 
Veterans Service Representatives (RVSRs), and Veterans Service 
Representatives (VSRs).
    The DRO is a senior technical expert who is responsible for 
processing appeals. DROs hold many responsibilities including:

     Holding informal conferences and formal hearings with 
Veterans
     Evaluating the evidence of record including the need for 
additional evidence as a result of information obtained during the 
hearing
     Making direct contact with the appellants and their 
representatives
     Providing feedback to RVSRs on their initial decisions
     Playing a central role in employee development, including 
mentoring new rating specialists, participating in the training of 
RVSRs, and coordinating training opportunities with BVA and local 
medical centers
     Certifying appeals to the BVA and coordinating their 
transfer to BVA.

VBA's Appeals Management Center (AMC) has jurisdiction over most 
appeals remanded to VBA for additional action by BVA and the Court of 
Appeals for Veterans Claims. The AMC has approximately 180 employees 
whose sole focus is to process appellate remands.

    Question 2. Additionally, how will new technology and a paperless 
system help resolve these longstanding claims that are stuck in the 
appeals process?
    Response. The Veterans Benefits Management System (VBMS) is 
utilizing smart-scanning technology, which provides searchable PDFs and 
electronic data. Enhanced search capability allows for easy 
identification of key words to aid in the quicker review of evidence. 
Future functionality will support the linking of evidence to specific 
disabilities/key words, providing the reviewer with the capability to 
better organize documents/images for subsequent reviews. Utilizing 
business rules, VBMS will have tools to assist the reviewer with 
identifying gaps in the claim development process, consequently 
reducing premature advancement of a claim to the next step in the 
claims process. More significantly, the planned advanced rules-engine 
technology will assist decisionmakers with assigning disability 
evaluations based on predefined embedded evaluation criteria for 
disabilities in the current 38 CFR, Part 4, Schedule for Rating 
Disabilities. Incorporating these rating tools will support consistent 
and accurate disability decisions, which may reduce the number of cases 
entering the appeals process. These tools and capabilities will also 
directly support Decision Review Officers in carrying out their 
decisionmaking responsibilities on appealed claims decisions.
                                 ______
                                 
  Response to Posthearing Questions Submitted by Hon. Scott Brown to 
                  U.S. Department of Veterans Affairs
    Question 1. I met with members of Massachusetts Chapter of Disabled 
American Veterans in my Boston office recently and listened to their 
concerns about the inadequate facilities at the VA Hospital in West 
Roxbury. It serves veterans from the entire North East Region, and is 
the highest level of care within its regional Veterans Integrated 
Service Network.
    West Roxbury VA Hospital serves veterans from all over New England, 
but its operating room is too small for modern surgical equipment. As a 
result, the facility is in need for significant upgrades.
    I am concerned that with a proposed 40% cut in VA construction in 
FY 2012 that the facility that has needed these improvements for many 
years will be one of the projects pushed to the side. Please provide me 
with an indication of where the West Roxbury VA Hospital stands on the 
list of modernization/recapitalization priorities for the VA and why.
    Response. VA Boston HCS submitted, and Veterans Integrated Service 
Network 1 endorsed, a major construction project for consideration in 
fiscal year (FY) 2012 to modernize and enhance the West Roxbury campus, 
a tertiary care VA facility serving Veterans throughout New England.
    The multi-story project would co-locate such critical as: operating 
rooms; intensive care units; emergency department; radiology (including 
a magnetic resonance imaging unit and computed tomography); instrument 
sterilization (supply, processing and distribution); and other 
ancillary services. The proposed addition would renovate existing 
building space to increase capacity to accommodate workload increases 
and improve clinical access. At present, the West Roxbury facility 
provides and will continue to provide safe, appropriate, and skilled 
care to our Veterans. Additionally, investments have been made to 
further enhance the facility's services. In the past three years, more 
than $20 million has been spent in improvements and repairs to the 
infrastructure and $36 million in equipment.
    The proposed project was evaluated during the FY 2012 Strategic 
Capital Investment Planning (SCIP) review, along with other capital 
investment proposals submitted for consideration. The project was 
ranked seventh of the major construction. The four highest ranking 
major construction projects are included in the FY 2012 budget request. 
The West Roxbury project and the other projects not selected during the 
FY 2012 SCIP process must be resubmitted in FY 2013 for funding 
consideration.

    Chairman Murray. Thank you very much, Mr. Secretary. As you 
know, we have been called to vote. We have a few minutes to get 
to the Floor. I am going to call a short recess, approximately 
10 minutes, and when I return we will begin with questions.
    [Recess.]
    Chairman Murray. We will reconvene this hearing. A number 
of Members are still on the Floor voting, and they will be 
returning shortly. We will now move to the question period with 
the Secretary.
    Mr. Secretary, I have a great deal of respect for the work 
that you have done on homeless and women's issues, and I know 
you are working diligently in a number of ways, but I wanted to 
bring up an issue that I am very concerned about.
    I have already discussed the caregiver issue with you. I 
have talked about it with Jack Lew. I have talked with senior 
staff at the White House, and I have spoken directly with the 
President of the United States. VA's plan on the caregivers' 
issue was overdue, and once submitted, it hardly resembled the 
bill that unanimously cleared this Congress. Three weeks ago, 
my Committee staff requested information on how that plan was 
developed, and to date, no information has been provided.
    Rather than following the law, the Administration set forth 
some overly stringent rules, bureaucratic hurdles that would 
essentially deny help to caregivers.
    Sarah and Ted Wade, who were staunch advocates and worked 
hard with us to get this passed, were invited by the President 
to attend the bill signing at the White House. Ironically, they 
will not be eligible for the new program under the plan that 
the Department submitted.
    We are also hearing from a lot of other veterans and 
caregivers from across the country who fall outside of this new 
line in the sand the VA has drawn or who have been left in 
limbo and now do not know if this benefit that they advocated 
and worked so hard for will support them.
    Mr. Secretary, it appears that your Department is not 
complying with the law as written. Can you please tell this 
Committee why?
    Secretary Shinseki. Chairman Murray, let me begin by 
expressing my regret that the implementation plan was late 
getting to you. We did our best. We are looking forward at this 
point on how to accelerate the process.
    I would also add that the importance of family in caring 
for our Nation's injured veterans has been a long-standing 
concern and issue for the VA; and, as you know, we have about 
eight decades of history of caring for the caregivers.
    We have demonstrated this dedication to them in a wide 
range of ways over the years. Benefits that are already offered 
include education, training, homemaker, home health services, 
respite care, and family support services. But more than 
programs, we see it in the thousands of acts of compassionate 
care provided by VA employees on the front lines.
    Through the caregivers bill enacted last year, thanks to 
the leadership--your leadership specifically but the leadership 
of Congress as well--Congress and the President built on this 
foundation by establishing landmark new benefits for post-9/11 
veterans that for the first time provide direct financial and 
broad health care support directly to the caregiver. We have 
not done this before, and we are working through the complexity 
of what this means.
    Implementation of the more unprecedented features of the 
law has taken longer than I anticipated or would have liked. We 
understand the frustration that has been expressed on the part 
of some.
    We have responded by greatly expediting the required 
regulatory process through the use of what I described as the 
interim final regulation, transmitted to the Office of 
Management and Budget on Monday.
    I assure veterans and the Congress that the Administration 
will move quickly and, we plan to have direct-to-caregiver 
benefits in place this summer, early this summer.
    We also understand the concerns that have been expressed 
with the scope of the benefit, as we have proposed, in our 
implementation plan. We have an obligation to get this right, 
to get this benefit right, and that means meeting the 
requirements of the law and also making sure that those VA 
employees on the front lines of caring for our veterans have a 
clear and consistent set of guidelines to apply.
    It has been a challenging exercise. I will state that. It 
is my personal obligation to be able to explain to an injured 
veteran why he or she would not be eligible for this benefit 
while someone else in his or her company with similar injuries 
would be, and that is the standard we are trying to establish 
here.
    That standard has guided our efforts to this point, and I 
hope remains in whatever standard we finally establish.
    That said, I want to be clear we are absolutely open to 
suggestions for different places to draw that line than what we 
have put forward. What we put forward was a starting place, but 
the standard must work in the real world on the clinical front 
lines where differences exist; and combinations of injuries, 
mental and physical, are as unique as the veterans themselves.
    To that end, Madam Chairman, VA is willing and I am willing 
to work with you and Members of this Committee and your staff 
and all the veterans and families who are represented and have 
a stake in this. I welcome the input both from you, Ranking 
Member Burr, and others in trying to develop clear, clinical 
guidelines for this program.
    OMB is now reviewing the regulation. I will take this 
opportunity to encourage all with a stake in this important new 
program to provide us the benefit of their insights and their 
comments, and I will provide feedback to you at the appropriate 
time.
    Chairman Murray. Thank you very much, Mr. Secretary. I know 
this is a new law. We considered that as we prepared it and 
wrote it and worked with many, many people to get it done. But 
I think it is absolutely imperative that in this time of war 
with OIF and OEF soldiers coming home seriously disabled, a 
generation of soldiers that are facing very long-term care with 
spouses, siblings or parents caring for them, that we make this 
right and make it right soon.
    I am deeply concerned, first of all, in the lack of 
communication and the lateness in getting this to us. We are 
past that now, but we are at a very unfortunate stage. The 
rules have gone to OMB and may be out in a few months. Then 
implementation takes a while, and you are only now offering to 
let us look at different ways of writing the law.
    So, we have a real challenge in front of us to be able to 
write it in the way Congress intended. If the rules come out as 
we saw the draft with the narrow definition, it will not be in 
keeping with the intent of Congress.
    We are happy to work with you now to tell you what we feel 
should be implemented, but we are facing a seriously difficult 
challenge because of where it is today.
    So I am very concerned about that and will have more to say 
about it. I think it is important to remember why we wrote 
this. We know that in every war soldiers come home and need 
care; but in this war, in particular, where we have saved the 
lives of many, many soldiers, they have come home with very 
seriously challenging issues to deal with, and their spouses or 
their parents are now required to quit their job, lose their 
income, and care for them. That was the reality behind the 
intent of Congress.
    The narrowness we saw in your rules excludes many people 
who we believe Congress wrote the law to cover. So we are going 
to have to work on this.
    But I wanted to ask you today, of $180 million that the 
budget submission specifies for the Caregivers and Veterans 
Act, how much is going to be actually allocated for the 
implementation of the family caregiver program?
    Secretary Shinseki. In the 2012 budget, it is $66 million.
    Chairman Murray. $66 million for the implementation.
    The legislation authorized an average of $308.4 million for 
this program each year. Can you tell us why the VA is only 
planning to use about 21 percent of that?
    Secretary Shinseki. Madam Chairman, I would just say that 
that again is where we established the start point. We expect 
this program will grow.
    Chairman Murray. Pardon me.
    Secretary Shinseki. We expect that this program will grow. 
The $66 million was based on our estimate of going through the 
veterans who are in various categories of serious and severe 
injuries, and the numbers on which $66 million are based was 
that initial eligibility start point, roughly about 1,000.
    Chairman Murray. Very narrowly redefined though; not 
defined as the law was.
    Secretary Shinseki. That is correct.
    Chairman Murray. It was the intent of Congress that the law 
not be narrowly defined. So we have an issue between us on that 
one.
    Secretary Shinseki. OK.
    Chairman Murray. Let me ask one other question, and I will 
then turn to the Ranking Member, but we will have a lot more 
discussion about this caregiver bill.
    I recently saw a newsletter written by the director of the 
Indianapolis VA medical center, talking about a variety of cost 
savings initiatives that the VAMC will undertake. He indicated 
that he intended to seriously reduce bonuses but he also would 
be slowing the hiring of additional and replacement staff.
    Will those types of cost savings actually result in the 
degradation of quality?
    Secretary Shinseki. Madam Chairman, I am going to call on 
Dr. Petzel to address the specific issue there at Indianapolis. 
But what I would offer up front is that we now have a year-long 
budgeting dialog--the beginning of the year, midyear, and end 
of year--and there are adjustments made.
    No VISN director of the 21 VISNs has come in and said they 
are unable to execute their program for the year, and we hold 
them responsible for balancing resources and requirements.
    Dr. Petzel. Thank you, Mr. Secretary.
    Madam Chairman, the estimate, the letter that you read, 
which I also read, was an early estimate of what their budget 
might look like. Those estimates are refined almost weekly as 
medical centers begin to spend their money. If you were to 
look, in fact--we have asked what the estimate is now; it is 
substantially reduced.
    As the Secretary has said, we review--here in Washington, 
he personally reviews with each one of the networks, their 
budgets, and how well their medical centers are doing.
    We have no evidence that any medical center is not going to 
be able to meet their obligations and not going to be able to 
provide the kind of care that you and I expect.
    Chairman Murray. Well, the Indianapolis director said that 
they were facing an $18 million budget gap this fiscal year.
    Dr. Petzel. That was the difference between what they 
wanted and what they got. It does not represent the difference 
between what they need and what they got.
    So if you were to look, if we were to ask what is that gap 
now, we would find that is not $18 million. It has been 
substantially reduced, if not actually disappeared.
    In addition to that, if that were true, if there were an 
$18 million shortfall between what they got and what they 
needed, the networks are able to make up those differences. 
They have reserve funds. The Secretary has a reserve fund. We 
have, as I said, reviews at least three times a year here in 
Washington of the financial state of each one of the medical 
centers. There would be money to take care of that.
    Chairman Murray. How many VISNs currently are facing a 
budget shortfall?
    Dr. Petzel. None.
    Chairman Murray. Quickly, on the issue of bonuses, I was 
surprised at the number of bonuses that were awarded last year. 
Among them, actually, was the director of the medical center in 
Dayton, OH, where there have been serious problems we have been 
hearing about: with respect to a dentist failing to practice 
basic hygiene and overall poor management of human resources in 
the dental clinic and other areas.
    Apparently, he received more than $11,000 this year and 
$64,000 since 2006, with problems going on the entire time. 
Executives from other troubled medical centers received 
significant bonuses as well.
    Mr. Secretary, I wanted to ask you. Are you going to be 
seriously reducing the number of bonuses paid the same way that 
the director of Indianapolis was forced to do?
    Secretary Shinseki. Madam Chairman, let me start and then 
call on Dr. Petzel for any details.
    I would offer that for the past 2 years, we have paid 
specific attention to the way bonuses are paid. Without making 
any statements about how it was run prior, I just did not find 
as close a connection between performance and bonuses.
    I do believe bonuses have a real role to play in the 
compensation programs designed to encourage best behaviors, 
superior performance; and where that happens, I think there is 
justification for that.
    For the past 2 years we have looked very closely at it and 
I am happy to provide you the details. You will see the 
``outstandings'' and the number of bonus payments actually 
adjusted quite significantly.
    To your direct question about Dayton, I cannot justify the 
performance of what happened at Dayton. I think there is a 
failure of leadership, and therefore, I am not going to try to 
describe why a bonus was sensible.
    But suffice it to say, this issue came up because VA 
workers thought we had a problem. This went on for an extended 
period of time where it was not brought to the attention of 
leadership and, again, I attribute that to a failure in the 
leadership, that the climate was not conducive for the 
workforce to believe they could raise the issue and get a 
satisfactory response. I own that, and my responsibility is to 
correct that, and that is what we are doing.
    Chairman Murray. OK. I appreciate that. Thank you.
    Senator Burr.
    Senator Burr. Thank you, Madam Chairman.
    I have got a number of questions, Madam Chairman, and I am 
going to ask unanimous consent that I have the opportunity to 
send them all to the VA and have them respond for the record.
    Mr. Secretary, I am going to spend my time now talking 
about the caregivers bill. I did not intend to do this, and 
there will not be questions.
    I would like to tell you a story this morning. On an 
evening when the U.S. Senate alarms for some type of bio- or 
chemical-detection went off, all the doors were shut down, and 
Members and staff were hustled into the Russell garage for 
hours until we got the all-clear, that night I had an 
opportunity to meet a young man. He could hardly function.
    He was a warrior back from Iraq, a kid that when they made 
the decision at Landstuhl to put him on a plane and fly him to 
the United States, there was not a health care professional in 
the room that believed he would live through that trip; and for 
that reason, he was discharged before he left because it was 
perceived that it would be advantageous to the family to have 
him discharged before.
    There was only one problem; they never told Ted Wade. Ted 
lived. Ted got back because of an unbelievable spouse and 
family support. Ted continues to make progress every day. He 
will never get back to the kid he was.
    It was Ted Wade and Sarah Wade that I think played the 
biggest part in the creation of the Caregiver Act. When we 
talked about passing the caregiver bill, I do not think that 
there was a Republican or Democrat on this Committee who did 
not look around and see Sarah and Ted Wade.
    Sarah was tireless in her contributions to crafting the 
legislation to get it right so that at the end of the day we 
could look at the product we had produced and be proud, not 
just today but for the future, that this was going to affect 
families in ways that provided them the opportunity to invest 
in their family members who had committed so much.
    Until this morning, it really was not raised to this level 
on my radar and when we wrote the legislation, we wrote it in a 
way that was pretty clear.
    I have got to tell you, if I were you, I would pull it back 
from OMB; I would ask them not to comment. If I were you, I 
would go back and rewrite this rule. I say to you and your 
staff of great professionals, if you insist on moving this as 
currently written, it will be one hell of a fight because the 
way I read this, unless somebody otherwise is 
institutionalized, a caregiver gets no benefits. That was not 
the intent of the Committee Members.
    If there is something that we are missing from a standpoint 
of the ability to administer or the funding needed, then it is 
a conversation we need to have, and I am ready to have it.
    But to suggest that only the veterans that otherwise would 
be institutionalized qualify for this is to take a kid whose 
medical assessment was that he would never live to make the 
trip back to the United States and then say, you know, ``You've 
got a loving, caring wife, who is going to take care of you. 
She will change her entire life to be able to be there to take 
care of you. But because she does that and you continue to 
improve, your only other option would not be to be 
institutionalized.''
    We were trying to make sure that was not the only option 
that was left for kids, to institutionalize them, and now all 
of a sudden it has become the threshold for participation in 
the program.
    Let me suggest that the effort is misguided right now, and 
I would implore all of you go back to the table. Read the bill 
again. What is not clear might be influenced by our intent, and 
we will help you move from where we are today to where we need 
to be for these veterans in the future.
    I thank you for your commitment.
    Thank you, Madam Chairman.
    Chairman Murray. Thank you very much, Senator Burr, and I 
look forward to working with you on that.
    Senator Rockefeller.

           STATEMENT OF HON. JOHN D. ROCKEFELLER IV, 
                U.S. SENATOR FROM WEST VIRGINIA

    Senator Rockefeller. Thank you, Madam Chair.
    One of the reasons I am here, not the most important 
reason, but one of the reasons I am here is that this is your 
first day chairing, and I think that is extraordinarily good 
news for the Veterans' Committee, very good news for General 
Shinseki, and very good news for veterans as a whole. So I 
wanted to say that.
    Chairman Murray. Thank you.
    Senator Rockefeller. That is on the record, is it not?
    Chairman Murray. It is.
    Senator Rockefeller. OK. The other reason I am here is 
parochial, which is very untypical of me, actually. But I have 
a point that bothers me.
    I had a conversation with the head of the National Science 
Foundation recently. They had a very important program that 
affected a lot of the research that we were doing at West 
Virginia University.
    It emanated actually from EPSCoR. It was a philosophy 
matter because it used to be that science research was given to 
the Harvards, the Stanfords, the Yales, you know, all of those. 
But the smaller universities, or you could say smaller States, 
that do not have the high ranking, that are not as prestigious, 
just never got a grant from the National Science Foundation.
    They were peer-reviewed so that you could say that we did 
bad grants but I do not think we did because I helped invent 
that program, EPSCoR.
    I got the head of the National Science Foundation to agree 
that rather than accumulate all of the secondary programs in 
his office, as opposed to committing them to a general sciences 
fund which would then mean that money would go to other 
institutions such as West Virginia University, such as--I do 
not know in Washington you do not have a small university, do 
you?
    Chairman Murray. We have great universities.
    Senator Rockefeller. You just have great universities, and 
we are aspiring to that, too.
    What comes into play is the fairness doctrine on the 
Beckley nursing home situation.
    West Virginia is not a big State. The Beckley nursing 
home--the case that I could make to you for that is lengthy and 
goes back a number of years. Senator Byrd and I worked on that 
very, very hard. Senator Murray remembers this herself I know. 
Anyway, WVU is on a sort of secondary list.
    Now, you are overwhelmed with all kinds of things. You are 
going to be facing budget cuts, I mean, all kinds of things 
that you are overwhelmed with, and I know that. I have enormous 
respect for you, as you know.
    But when I see that we are lumped in with all other 
construction projects in one massive category from which some 
will emerge and some will not--being from Appalachia and having 
that degree of fatalism which is necessary to have if you are 
from Appalachia and also necessary to overcome if you are from 
Appalachia--I have this feeling that we are not going to get 
funded.
    Now, we would have the funding had the omnibus 
appropriations bill passed last year, but that was stopped at 
the last moment.
    So my question to you is what can we do? I am just in the 
wilderness on this. It is so important to our State, to our 
veterans, and yet we are not high enough on the list, and we 
have been ranked in another category. I do not know what it is 
that we can hope to expect. I also want to know what it is that 
I do about trying to improve our circumstance, because if you 
are from Appalachia you have to be skeptical. You have to 
assume that you are going to be left behind, that others will 
be picked because they have more people, they have, you know, 
more criteria.
    So, I admit that is a fairly self-serving project but it 
serves veterans with dementia and all kinds of other problems. 
This is something that you and I have actually talked about and 
I have written to you about it.
    But I just wondered what can I look forward to doing or 
what should I be doing? I mean this hearing is a darn good 
first step. But what should I be doing to improve the 
opportunity for that project to succeed?
    Secretary Shinseki. Senator, you and I have discussed this. 
I am going to call on Dr. Petzel here to give us an update of 
where we think we are. We thought we had this issue addressed.
    Senator Rockefeller. Right.
    Secretary Shinseki. We are now adjusting to the current 
situation.
    Senator Rockefeller. I understand that.
    Secretary Shinseki. But let us give you the state of play 
here from our side.
    Dr. Petzel. Thank you, Mr. Secretary.
    Senator Rockefeller, I do not know specifically where this 
sits right now on the construction list, so what I would like 
to do is have the time to go back and look to see what the 
order of priority is with nursing-home construction. As I am 
sure the Secretary could tell you and Mr. Grams could tell you, 
we have a huge need in terms of construction.
    Senator Rockefeller. Of course.
    Dr. Petzel. This is special from a number of different 
perspectives. One, it talks about an Alzheimer/dementia unit 
which is something that we desperately need within the VA.
    So what I would like to do is beg your indulgence, go back 
and take a look at the list, and we will communicate after I 
have had a chance to look at it.
    Senator Rockefeller. Completely satisfactory.
    Secretary Shinseki. I would just add, Senator, that in my 
opening comments, I talked about something called SCIP, which 
is our Strategic Capital Infrastructure Program where we look 
at all of our assets: medical centers and outpatient clinics, 
both leased and ones we run, to make sure that we have, looking 
forward, a good plan for what we expect out of each of those.
    I would offer that constructing a nursing home care unit at 
Beckley was submitted as part of that 2012 SCIP process for 
consideration as a future budget request. It is not in the 2012 
budget, but we anticipated we were not going to have this issue 
to deal with in 2012.
    We are now adjusting. In our 2012 study, this nursing home 
is addressed as a requirement for a future budget request. That 
is sort of the current state of play. The project is about an 
80,000-square-foot facility which I think we have costed, so we 
have a pretty good idea of what that is going to be. It will 
give us a way to make sure that it gets addressed here in the 
future.
    Senator Rockefeller. I thank you.
    Thank you, Madam Chairman.
    Chairman Murray. Thank you, Senator Rockefeller.
    I want to welcome to our Committee Senator Boozman. We are 
delighted to have you. Do you want to give an opening statement 
and ask questions? Either one.

                STATEMENT OF HON. JOHN BOOZMAN, 
                   U.S. SENATOR FROM ARKANSAS

    Senator Boozman. Thank you, Madam Chair. I want to 
congratulate you on being Chairman. I look forward to working 
with you and Senator Burr as we all push forward and work 
really hard to get a lot of stuff accomplished for veterans.
    I guess really the only questions I would have--I 
appreciate having the opportunity to work with you, Secretary 
Shinseki, on the House side on the Veterans' Affairs 
Committee--I know that you really are working hard for our 
veterans. We just have a lot of issues out there that we have 
to deal with.
    One of the things that I was really involved with was a GI 
Bill implementation. I really feel kind of bad in the sense, 
you know, there for a while I literally--as being Chair and 
then Ranking Member on the Veterans' Employment Subcommittee, 
Economic Opportunity--it seemed like, you know, we were meeting 
every month, getting updated. So I would really like a bit of 
an update there; making sure that we have got the resources. 
Then, the other thing that I was really concerned about was 
putting veterans to work. In this difficult time of employment, 
it is hard on everyone and yet, with these multiple 
deployments, I am very concerned that perhaps employers are 
starting--maybe psychologically or whatever, sometimes 
willfully, it is difficult. Many of these individuals are from 
small towns. They get called up and it is hard sometimes to go 
back to work.
    So if you could comment on those things, I would appreciate 
it.
    Secretary Shinseki. Senator, let me begin with GI Bill 
processing. I think a lot has transpired since we went through 
that first initial fall where everything was done pretty much 
by hand.
    We have automation tools that are now in place and there 
have been successive drops. One more drop to go--a program to 
be inserted to give us a long-term automated solution to the GI 
Bill processing.
    I will call on Secretary Baker to describe for you what 
that is, and then I will address the other pieces of your 
question.
    Senator Boozman. The other thing, Mr. Secretary, is in the 
course of that, and here today again we have limited time, but 
I would be interested if you have a process in place that would 
make it more efficient for us to legislatively adjust it 
somewhat. That would be very helpful also.
    Mr. Baker. Thank you, Senator. On the efficiencies I am 
going to defer to Mr. Walcoff to talk potentially about those.
    We are working hard right now on the technology to 
implement the upgrade to the law. This weekend we will install 
the IT changes for the 60-day requirements from that law.
    On June, I believe it is about the 14th, we will install 
all the IT changes necessary to support the August 1st 
requirements of law. So we are processing well there.
    We have many optimizations we can do in the processing of 
those claims that are scheduled for the release after the new 
law is put in place. So that is actually deferred while we 
implement the new law. But we are on track with the program and 
very pleased with the new technology that is in place, with the 
long-term solution and its flexibility for us.
    Let me ask Mr. Walcoff to talk about efficiencies from a 
legislative standpoint.
    Mr. Walcoff. Thank you, Secretary Baker.
    Senator Boozman, it is good to work with you again. I am 
really pleased to be able to say that we have come a long way 
since those days that you were referring to, the first semester 
that we had the new GI Bill.
    A lot of that progress is due to the technology that has 
been developed by Secretary Baker and his people. I just want 
to give you an example of how effective this technology is.
    In the processing of a supplemental claim--say it is not 
the first time a veteran has come in but once he has been 
enrolled, he comes in semester after semester; they are called 
supplemental claims.
    Under the manual system, the one that caused us to have 
such a big backlog 2 years ago, it took about 40 minutes to 
work a supplemental claim. With the new technology that has 
been delivered by our IT people, we now do a supplemental claim 
in about 7 minutes. They are the largest number of the claims 
that we receive.
    So with that type of efficiency gain from the technology, 
it has enabled us to be in much better shape in terms of the 
delivery of benefits.
    Senator Boozman. Thank you.
    Secretary Shinseki. To the issue of jobs, it is something 
we work on. I am part of an interagency effort to increase the 
number of veterans hired into the Federal Government 
departments.
    We just had the latest meeting yesterday and the vast 
majority of a number of departments have increased veteran 
hiring inside their own organizations. The VA is probably just 
around 30 percent. We were several points less 2 years ago. So 
we have begun to make the move in the right direction.
    Other things we have underway, small businesses that are 
owned by veterans, disabled veterans, are a high priority with 
us. We look for the opportunity to give them a veteran's first 
competition opportunity for contracts that VA controls. We 
encourage other departments to do the same.
    We invite in small business owners once a year, take them 
through a training program where we encourage them to start 
businesses primarily because veterans tend to hire other 
veterans and that creates the churn we are looking for.
    Senator Boozman. Thank you, Madam Chairman.
    Chairman Murray. Thank you very much.
    Mr. Secretary, last week I had a number of listening 
sessions with veterans in my homestate, and I heard a lot of 
concern about the elimination of interval pay during breaks in 
schools.
    I know the President's Fiscal Year 2012 Budget does not 
completely reflect the implementation of the recently enacted 
improvements legislation. But I wanted to ask you today if you 
have any more information on the number of students we have 
that might be affected by the elimination of interval pay: how 
many are veterans; how many are active duty; how many are 
transferees; and what is the average amount of living allowance 
that they are going to be losing?
    Secretary Shinseki. Madam Chairman, I am going to call on 
Mr. Walcoff to provide some of that detail. Some of that data I 
think we will have to provide for the record, and I am happy to 
coordinate that with you.

    [The information requested during the hearing follows:]
Response to Request Arising During the Hearing by Hon. Patty Murray to 
 Hon. Eric K. Shinseki, Secretary, U.S. Department of Veterans Affairs
    Response. The Department of Veterans Affairs (VA) provided 
education benefits to more than 800,000 students in fiscal year (FY) 
2010. Of these, approximately 366,000 students trained under the Post-
9/11 GI Bill. During this period, approximately 278,000 Post-9/11 GI 
Bill students qualified for interval payments--235,000 Veterans and 
43,000 transferees. While there were 18,000 servicemembers, these 
individuals are not entitled to interval pay under the Post-9/11 GI 
Bill. Based on the recently enacted legislation, 278,000 individuals 
would no longer qualify for an interval payment, which currently 
provides an average housing allowance of $1,348.84.
    For the other VA education programs, such as the Montgomery GI 
Bill--Active Duty, Montgomery GI Bill--Selected Reserve, Reserve 
Educational Assistance Program, and the Dependents' Educational 
Assistance Program, there were approximately 311,000 individuals who 
would no longer qualify for interval payment based on FY 2010 data.

    Chairman Murray. That would be fine.
    Secretary Shinseki. I would say we have enrolled in the GI 
Bill program right now about 427,000 veterans and family 
members, and the elimination of interval pay applies to all of 
them.
    Chairman Murray. Right.
    Secretary Shinseki. So, if we add to the GI Bill program, 
the Montgomery GI Bill voc rehab students, that number is 
800,000; and the elimination of interval pay applies to all of 
those students.
    Mr. Walcoff. I do not have anything more specific in terms 
of numbers. The Secretary gave the numbers that I have with me. 
But I will tell you that one of the things that we are very 
concerned about is that veterans are in the know about all the 
changes, including that change, because a lot of plans were 
made based on the fact that they expected that they would get 
paid for the intervals.
    So, we basically have an outreach plan to veterans to make 
sure that they know about all the changes. As a matter of fact, 
there is a letter that is going out----
    Chairman Murray. They not only know, they are panicked.
    Mr. Walcoff. I know. It is a serious situation for some who 
had, in their planning, had it down to the point where they 
need every payment that they were expecting. But we are sending 
a letter out to every veteran who is receiving the GI Bill to 
make sure that if they had not known, that they are at least 
now aware of it; and we acknowledge that it is going to have a 
negative effect on some veterans.
    Chairman Murray. Mr. Secretary, would the Department 
consider using any authority for emergency payments, like it 
did during the period of time when difficulties were first 
encountered with this program, to use some kind of help for 
financial hardship for some of these students?
    Secretary Shinseki. Madam Chairman, I think the answer is 
yes. I mean, there are opportunities for the Secretary to 
exercise a judgment in specific cases. We tend not to write a 
blanket policy that applies to everyone but deal on a case-by-
case basis.
    Yes, the emergency route is available. I do know the other 
side of that is the requirement to also later collect and that 
presents a challenge for some. So we want to be judicious here 
and provide it to the most strenuous cases where we know there 
is no other alternative, and then after that waive whatever 
difficulty there might be. Manage the problem, not create 
another one.
    Chairman Murray. OK. I completely respect the complexity of 
it, but I do think there are some very significant financial 
hardships for some of these folks that would be very much 
helped by that, so I would like to work with you on that.
    Secretary Shinseki. OK.
    Chairman Murray. Let me ask about claims processing. It is 
a perennial question but it is as serious today as when I first 
started working on this Committee a long time ago.
    It is one of the most common issues and heartfelt issues I 
hear from veterans. It will be one of the top priorities I have 
as chair of this Committee and I know that you are willing to 
work on that too, and I want us to both work from our 
respective positions because our veterans deserve no less.
    So, I want to ask a few questions about VBA. Can you 
account for the decrease from last year's level in 
discretionary spending for VBA?
    Secretary Shinseki. Mr. Walcoff.
    Mr. Walcoff. Yes. When you look at the 2011 budget--as you 
know, there was a big increase in the 2011 budget and that 
included the hiring of a lot of people. To support that hiring, 
there was a lot of money put in there for the training of all 
those people: the travel involved with that; all the support 
mechanisms that are needed to support the hiring of a large 
number of people.
    We are not planning on doing that kind of hiring in 2012 
for a lot of reasons that we can get into. But to answer your 
question directly, a lot of that money that was in the 2011 
budget to support the hiring of new people and the training of 
those people is taken out because we are not going to have that 
influx in 2012. That is the primary reason; and there is no pay 
raise. There are a few other reasons but that is the primary 
reason.
    Chairman Murray. OK. What specifically is included in the 
VA's budget that is intended to ensure more timely and accurate 
resolution of claims?
    Secretary Shinseki. We have a number of pilots underway 
that deal in three areas: people, process, and technology; and 
it takes all three to attack this claims backlog issue that has 
built up over years.
    Just a little history. When I arrived to 2009, VBA produced 
977,000 claims decisions that year, a high watermark for them. 
Everyone was very excited about it, and then realized that they 
got a million claims in return.
    In 2010, they produced a million claim decisions, and got 
1.2 million claims in the door. We expect this year that the 
number of claims we receive are going to be 1.4-1.5 million 
claims.
    It is a large number issue, and merely hiring more people 
will not get us out ahead of it. So we must automate. As I say 
over in VA, IT is the elephant in the house. We must do this, 
and we must do it quickly.
    In the meantime there is a crossover point. We have been 
investing heavily in IT, and we are looking for that crossover 
point at which we can begin to stop the investments in 
personnel and have what we have invested in automation take 
over.
    That crossover point we intend to be in 2012. Counting on 
IT drops that are going to produce what we have invested, spent 
monies for, that is to be determined. We are going to see that 
happen over the next year.
    I have a high degree of confidence that this will go with 
Secretary Baker leading the way on this and creating a 
structure for doing these things--a high degree of confidence. 
But again, we will know it when we see it. But 2012 is our 
target, and this budget for 2012 is an important crossover 
point.
    Chairman Murray. Thank you very much.
    Senator Sanders.
    Senator Sanders. Senator Murray asked the question that I 
wondered about, the processing of claims. Let us go to another 
area. How are we doing on homelessness? It appears to me we are 
making some progress. Can you give us some background on that?
    Secretary Shinseki. I would say from the Secretary's seat I 
have reached out and pinned a rose on an individual who is 
seated to my right. Dr. Petzel is the lead on our homeless 
program primarily because 85 percent of the homeless issue is a 
health-related issue. It is health care in general. It is 
depression. It is other mental health issues. Substance-abuse.
    The individual we have resourced with the capabilities to 
do something about that is our VA health care system. So Dr. 
Petzel has the lead for that, and through him every VISN 
director and every medical center director also has a 
responsibility to treat homelessness as a priority, not when 
someone walks in the door who happens to be homeless but 
reaching out to the communities they live in, touching base 
with folks from across the Nation that do this day-in and day-
out: Catholic Charities, Salvation Army, Volunteers of America, 
Swords-to-Plow Shares, etc.
    As I have described them in the previous testimony, they 
are really the creative geniuses here who, with very little, 
have done so much. It is time for us to link in with them. We 
have, and advantaged what they know to help us build a registry 
of the names of homeless veterans, at the same time looking at 
building a registry of at-risk veterans because whatever we see 
of the homeless situation--today the estimate is about 76,000, 
down from 107,000 previously.
    It is still an estimate. So, building a registry here is 
important to get us out of rescue mode, getting people off the 
streets, into prevention as well, and that is what we intend 
here, heavy effort in rescue today.
    We know that they are out there. We need a registry so we 
can focus on them, but at the same time, we need to develop 
some appreciation for the protection requirements.
    Senator Sanders. So what I am hearing, General, is that we 
are working with other organizations, we are making some 
significant progress.
    Secretary Shinseki. Absolutely.
    Senator Sanders. That is my impression.
    Let me ask you a more general question, and if Dr. Petzel 
wants to jump in, that is fine. As I understand it, you run the 
largest medical system in the United States?
    Secretary Shinseki. That is correct.
    Senator Sanders. Let me ask you a general question. We talk 
about health care a whole lot, with many debates. In fact, I 
just was talking to some young people from the United Kingdom 
and asked them about their system.
    In your judgment, compared to other systems in the United 
States of America, how does the VA rank? Is it a good system? 
Does it compare well to other systems? What would you say?
    Secretary Shinseki. Senator, I am going to answer that with 
2 years of hindsight. As I have testified before, I did not 
grow up in VA. Did not know much about it when I arrived to 
this position, and I am not a clinician. So, much of what I 
know today has been learned here by going and visiting our 
various facilities, and relying on the great expert guidance 
here by Dr. Petzel among others.
    I would categorize the VA health care system as excellent, 
and I compare that to a 38-year history of being in another 
very large health care system which took very good care of me 
day-to-day and also in the more serious moments, and I always 
thought it was an excellent system.
    Senator Sanders. You are referring to the military.
    Secretary Shinseki. The military health care system. I 
would put VA very much in that category, and in a number of 
ways superior to that.
    Dr. Petzel.
    Dr. Petzel. Thank you, Mr. Secretary.
    Senator Sanders, just a couple of comments to elaborate on 
what the Secretary said. We are actually the largest integrated 
health care delivery system in the country, and that is where 
the physicians, the hospitals, et cetera, all work under the 
same kind of organization. I think it is an important 
distinction to make.
    When you look at our performance, we have a very deep array 
of performance measures, particularly around quality, about 170 
of them. When you look at those measures that we can compare 
with the private sector, which is quite limited because there 
are not as many things being measured there and published right 
now, we rank very well.
    When you look at our performance on HEDIS and the ORYX 
measures--one, HEDIS looks at outpatient; ORYX looks at 
inpatient, which are nationally collected on every single 
medical center in the country--and compare the Medicare 
population performance of these medical centers with us, we 
rank way above.
    Senator Sanders. It's my understanding--somebody was 
telling me in terms of information technology, you guys are 
pretty close to the top. Are you not?
    Dr. Petzel. Our medical records, certainly at this point in 
time rank one of the best, if not the best, in the country. Of 
course, the private sector is playing catch-up right now and 
they are breathing down our neck. But, yes, we do have an 
excellent medical records ranking.
    Senator Sanders. If my memory serves, and please correct me 
if I am wrong, but there is obviously a lot of concern about 
infections in hospitals. You guys were doing pretty well in 
that, are you not?
    Dr. Petzel. A little background, Senator. The overall 
infection rate is a hard thing to measure across the country, 
not just within the VA. There has been disagreement as to what 
constitutes an infection, et cetera. The one place that there 
is a standard way of looking at this is with methicillin-
resistant staph aureus or MRSA. VA has done a remarkable job 
over the last four and one-half years of reducing its hospital-
acquired MRSA infection rate. I would say we are doing as well 
as any hospital system in the country right now.
    Senator Sanders. These are my last questions, Madam Chair.
    Everybody is concerned about the high costs of health care 
in the United States. We spend almost twice as much as any 
other country on health care. How cost-effective is the VA 
health care system?
    Secretary Shinseki. I would just point out that the 
effectiveness of the VA health care system is excellent, and 
one of the ways we look at this is comparing what it costs to 
take care of a patient during the course of a year and compare 
it to what our known costs are for taking care of a homeless 
veteran who comes to us on those occasions when they need help. 
The cost of taking care of the homeless veteran is three and 
one-half times the cost of other health care we deliver.
    Therefore, it is in our interest to get our homeless 
population in, cared for, and off the streets. So, it is both a 
health care issue for them and a cost factor for us to give 
them the excellence that VA provides.
    Senator Sanders. But you would argue that at a time of 
great concern about health care costs, you are running a cost-
effective operation?
    Secretary Shinseki. We are.
    Senator Sanders. Madam Chair, thank you.
    Chairman Murray. Thank you.
    Let me follow up on the issue of homelessness. It is one 
near and dear to my heart. I notice that the House continuing 
resolution would end the expansion of the HUD-VASH program, and 
I wanted to ask you today how many eligible veterans do you 
have on the waiting list to participate in that program?
    Secretary Shinseki. Dr. Petzel.
    Dr. Petzel. Just to review the HUD-VASH situation right 
now, in 2008 we received 10,000 vouchers. We received 10,000 
vouchers in 2009 and 10,000 vouchers in 2010. To date, we have 
assigned 29,000 of those vouchers. They have actually been 
acted on by HUD in 22,000 cases.
    I am not aware at the present time of a waiting list for 
HUD-VASH vouchers. That does not mean there is not one. I just 
am not aware of it.
    Chairman Murray. If you could check for me and find out.
    Dr. Petzel. We will.
    Chairman Murray. I would really appreciate that.
    Dr. Petzel. Yes, Madam Chairman.

    [The information requested during the hearing follows:]
Response to Request Arising During the Hearing by Hon. Patty Murray to 
     Hon. Robert A. Petzel, M.D., Under Secretary for Health, U.S. 
                     Department of Veterans Affairs
    According to VA officials, there is no master HUD-VASH List. 
Facilities are allowed to locally keep a list of veterans who might be 
eligible, but not all facilities keep these lists, and an overall list 
or count is not tracked nationally.

    Chairman Murray. And the budgetary implications if the 
government does not continue running. I just heard the 
Secretary say that caring for a homeless veteran costs three 
and one-half times that of one that we have in the system, and 
the budgetary implications of that too. If you could get that 
back to me, I would appreciate it.
    Chairman Murray. I want to ask about women veterans. We 
have talked about it a number of times. I wanted to ask what 
funds in this budget are directed toward expanding operating 
hours in women's clinics to make sure that women get the care 
they need.
    Secretary Shinseki. Let me comment, Madam Chairman, and I 
will turn to Dr. Petzel for specifics.
    In the 2012 budget, we intend to spend $270 million on 
gender specific care. It is more than a 25 percent increase 
over previous budgets.
    We have also dedicated $12 million to specific women's 
issues research. To this point in 2011, we have invested $29 
million in clinical enhancements and another $21 million in 
facility improvements. Those are things that will occur this 
year in preparation for these other budget data for 2012 that I 
have provided to you.
    Dr. Petzel. Thank you, Mr. Secretary.
    Senator Murray, I cannot specifically identify money that 
is in the budget directed at enhancing the hours for women 
veterans. We do have a program in a general sense of enhancing 
the available hours for clinics, primary care, specialty 
clinics, et cetera, including the women's clinics. But I will 
go back and look to see if we can break this out, but I could 
not do that for you now.
    Secretary Shinseki. Let me just add, we do not have a 
specific answer here. This is trying to build for the 2012 
numbers, but we have initiatives under way in which we are 
studying how to extend operating hours to include evenings and 
Saturdays for female veterans, especially if they bring 
children with them.
    Chairman Murray. To that point, what is the status of the 
childcare project--the pilot program that we put in?
    Secretary Shinseki. Dr. Petzel.
    Dr. Petzel. That was part of the caregiver legislation. We 
are creating a request for proposals and hopefully are going to 
have pilots out there by the summer so that we can quickly see 
what the implications might be for the entire system.
    Chairman Murray. That is really a huge barrier for women 
veterans today.
    Dr. Petzel. We absolutely agree with you. It is a barrier 
for male veterans in many cases as well.
    Chairman Murray. That is true.
    Senator Burr, do you have any additional questions?
    Senator Burr. No additional questions.
    Chairman Murray. OK. I have a number of other questions I 
will submit for the record. But before I let you go, Mr. 
Secretary, I did want to ask you, on January 5th, President 
Obama nominated Allison Hickey to be Under Secretary of 
Benefits and Steve Muro to be Under Secretary of Memorial 
Affairs.
    We, in this Committee, do not yet have the questionnaire 
from Mr. Muro or the other documents we need from these 
nominees in order to proceed.
    When can this Committee expect those documents?
    Secretary Shinseki. Madam Chairman, it is a priority with 
me. I have been working on this for over year. I will get you 
the documents. I was not aware there was a hold up. I will get 
the documents you need.
    Chairman Murray. OK. I appreciate that very much.
    I thank you very much for your testimony. I look forward to 
working with you on this budget, and as Senator Burr and I both 
have talked to you specifically about, the caregivers' issue, 
which is not going to go away. This is something we feel very 
strongly about. Thank you.
    If the second panel could move forward to the table. While 
they are coming up, I am going to go ahead and introduce them 
in order to expedite the time.
    We have a number of witnesses who are here to speak on 
behalf of The Independent Budget.
    It will be Carl Blake, National Legislative Director of the 
Paralyzed Veterans of America; Joe Violante, the National 
Legislative Director for the Disabled American Veterans; 
Christina Roof, National Acting Legislative Director of AMVETS; 
and Ray Kelley, National Legislative Director for Veterans of 
Foreign Wars.
    I also want to welcome to our table Tim Tetz, Director for 
the National Legislative Commission of The American Legion, and 
Dr. Maryann Hooker, Lead Neurologist at the Wilmington, 
Delaware, VA Medical Center, representing the American 
Federation of Government Employees.
    Beginning with Mr. Blake, we will move down the table in 
order. The Independent Budget witnesses will have 20 minutes 
total to make their presentation. The American Legion and AFGE 
will each be recognized for 5 minutes.
    I want to remind all of you that your prepared remarks will 
be made part of the record, and thank you all for joining us 
today.
    Mr. Blake, we will begin with you.

    STATEMENT OF CARL BLAKE, NATIONAL LEGISLATIVE DIRECTOR, 
                 PARALYZED VETERANS OF AMERICA

    Mr. Blake. Madam Chairman, Ranking Member Burr, and Members 
of the Committee, on behalf of the co-authors of The 
Independent Budget, the Paralyzed Veterans of America is 
pleased to be here today to present the views of The 
Independent Budget for the Department of Veterans Affairs on 
the fiscal year 2012 health care budget.
    Before I begin, I would just like to take the opportunity 
to thank the majority and minority staffs of the Committee for 
allowing the IB to sit down with them in advance of the 
President's Budget actually being released to discuss the 
budget recommendations that The Independent Budget ultimately 
provided on February 14 and 15.
    As you know, last year the Administration recommended an 
advance appropriation for fiscal year 2012 of approximately 
$50.6 billion in discretionary funding for VA medical care. The 
House supported this recommendation in H.R. 1 as well.
    When combined with the $3.7 billion for medical care 
collections previously projected by the Administration, the 
total available operating budget recommended for 2012 is 
approximately $54.3 billion.
    However, included in the President's budget request for 
fiscal year 2012, the Administration revised the estimates for 
medical care down by $713 million due to the proposed Federal 
pay freeze, a factor that was not included in H.R. 1.
    However, The Independent Budget did choose to mirror the 
zero pay raises for fiscal year 2012 in our recommendations 
across all of the accounts of the VA.
    I would like to say the IB appreciates the increases that 
the Administration has recommended for fiscal year 2012 in its 
medical care budget request. However, we do have some real 
concerns with the methods that the Administration uses to get 
to those projected increases.
    Of particular concern to The Independent Budget is an ill-
defined contingency fund that would provide $953 million more 
for medical services for fiscal year 2012. Moreover, we are 
especially concerned that the VA presumes ``management 
improvements'', a gimmick that was commonly used by previous 
administrations under the term ``management efficiencies'' of 
approximately $1.1 billion to be directed toward fiscal year 
2012 and fiscal year 2013.
    The VA has explained that these management improvements 
provide $1.1 billion that the VA would like to carryover, and 
yet if the VA is not authorized to carryover this additional 
money, its Fiscal Year 2012 Budget request and 2013 advance 
appropriations request will be insufficient to meet the health 
care demand of veterans it serves.
    Finally, we have real concerns about the revised estimates 
in medical care collections from the originally projected 
amount as also mirrored in the advance appropriations language, 
$3.7 billion. So now what is projected is only $3.1 billion for 
fiscal year 2012. Given this revision in estimates, the VA 
budget request may arguably be short $600 million in additional 
budget authority for next year.
    For fiscal year 2012, the Administration recommends $53.9 
billion for total medical care spending. The Independent Budget 
recommends approximately $55 billion for total medical care. 
This includes approximately $43.8 billion for medical services.
    Our medical services recommendation includes $41.3 billion 
for current services, $1.5 billion for the increase in patient 
workload, and $1 billion for additional medical care program 
costs.
    Each of these areas is explained in more detail in my full 
written statement and even greater detail in The Independent 
Budget for Fiscal Year 2012.
    For medical support and compliance, The Independent Budget 
recommends approximately $5.4 billion, and finally, for medical 
facilities the IB recommends approximately $5.9 billion. While 
our recommendation does not include an additional increase for 
non-recurring maintenance above current services levels, it 
does reflect a fiscal year 2012 baseline of approximately $1.1 
billion, and I would point out that the Administration's non-
recurring maintenance request is approximately $850 million, up 
from fiscal year 2012.
    We are also concerned about the steep reduction in spending 
for medical and prosthetic research. The Independent Budget 
recommends $620 million, approximately $111 million more than 
the Administration's request. As you know, research is a vital 
part of veterans' health care and an essential mission of the 
national health care system.
    The Independent Budget is pleased to see that the 
Administration has proposed an increase in the medical care 
accounts for fiscal year 2013. However, we urge Congress, and 
this Committee in particular, to remain vigilant to ensure that 
the proposed funding levels for fiscal year 2013 are, in fact, 
sufficient to meet the continued growth in demand on the VA 
health care system.
    Madam Chairman, that concludes my statement. I will be 
happy to answer any questions.
    [The prepared statement of Mr. Blake follows:]
   Prepared Statement of Carl Blake, National Legislative Director, 
    Paralyzed Veterans of America, Concerning The Independent Budget
    Chairman Murray, Ranking Member Burr, and Members of the Committee: 
As one of the four co-authors of The Independent Budget (IB), Paralyzed 
Veterans of America (PVA) is pleased to present the views of The 
Independent Budget regarding the funding requirements for the 
Department of Veterans Affairs (VA) health care system for FY 2012.
    With the newly elected 112th Congress just beginning to conduct 
business, it is important to once again review and assess the efforts 
of the 111th Congress to provide sufficient, timely, and predictable 
funding for the Department of Veterans Affairs (VA), particularly the 
VA health-care system. The first session of the 111th Congress laid the 
groundwork for a historic year in 2010. In 2009 the President signed 
Public Law 111-81, the ``Veterans Health Care Budget Reform and 
Transparency Act,'' which required the President's budget submission to 
include estimates of appropriations for the Medical Care accounts for 
fiscal year (FY) 2012 and thereafter (advance appropriations) and the 
VA Secretary to provide detailed estimates of the funds necessary for 
these accounts in budget documents submitted to Congress. Consistent 
with advocacy by The Independent Budget, the law also required a 
thorough analysis and public report by the Government Accountability 
Office (GAO) of the Administration's advance appropriations projections 
to determine whether that information is sound and accurately reflects 
expected demand and costs to be incurred in FY 2012 and subsequent 
years.
    The Independent Budget veterans service organizations (IBVSOs) were 
pleased to see that in February 2010 the Administration released a 
detailed estimation of its FY 2011 funding needs as well as a blueprint 
for the advance funding needed for the Medical Care accounts of VA for 
FY 2012. It is important to note that last year was the first year that 
the budget documents included advance appropriations estimates. 
Unfortunately, due to differences in interpretation of the language of 
Public Law 111-81, the GAO did not provide an examination of the budget 
submission to analyze its consistency with VA's Enrollee Health Care 
Projection Model. The Independent Budget was informed that the GAO was 
not obligated to report on the advance appropriations projections of VA 
until at least 2011. The IBVSOs look forward to working with Congress 
to ensure that the GAO fulfills its responsibility this year.
    For FY 2011, Congress provided historic funding levels for VA in 
the House and Senate versions of the Military Construction and Veterans 
Affairs appropriations bill that matched, and in some cases exceeded, 
the recommendations of The Independent Budget. Unfortunately, as has 
become the disappointing and recurring process, the Military 
Construction and Veterans Affairs appropriations bill was not completed 
even as the new fiscal year began October 1, 2010. Although the House 
passed the bill in the summer, the Senate failed to enact the bill in a 
timely manner. This fact serves as a continuing reminder that, despite 
excellent funding levels provided over the past few years, the larger 
appropriations process continues to break down over matters unrelated 
to VA's budget due to partisan political gridlock.
    Fortunately, this year, the enactment of advance appropriations has 
temporarily shielded the VA health-care system from this political 
wrangling and legislative deadlock. However, the larger VA system is 
still negatively affected by the incomplete appropriations work. VA 
still faces the daunting task of meeting ever-increasing health-care 
demand as well as demand for benefits and other services.
    In February 2010, the President released a preliminary budget 
submission for VA for FY 2011. The Administration recommended an 
overall funding authority of $60.3 billion for VA, approximately $4.3 
billion above the FY 2010 appropriated level but approximately $1.2 
billion less than The Independent Budget recommended. The 
Administration's recommendation included approximately $51.5 billion in 
total medical care funding for FY 2011. This amount included $48.1 
billion in appropriated funding and nearly $3.4 billion in medical care 
collections. The budget also included $590 million in funding for 
Medical and Prosthetic Research, an increase of $9 million over the FY 
2010 appropriated level.
    For FY 2011, The Independent Budget recommended that the 
Administration and Congress provide $61.5 billion to VA, an increase of 
$5.5 billion above the FY 2010 operating budget level, to adequately 
meet veterans' health-care and benefits needs. Our recommendations 
included $52 billion for health care and $700 million for medical and 
prosthetic research.
    The Administration also included an initial estimate for the VA 
health-care accounts for FY 2012. Specifically, the budget request 
calls for $54.3 billion in total budget authority, with $50.6 billion 
in discretionary funding and approximately $3.7 billion for medical 
care collections. Unfortunately, because work on the FY 2011 
appropriations bill was not completed, advance appropriations funding 
for FY 2012 remains in limbo.
    Moreover, recent actions by VA suggest that the FY 2011 advance 
appropriations funding levels (which were affirmed in the President's 
budget request) may not be sufficient to support the health-care 
programs managed by VA. In a letter sent to Congress on July 30, 2010, 
VA Secretary Eric Shinseki explained that he believes the advance 
appropriations levels provided for FY 2011--that virtually match the 
Administration's request for FY 2011--will be insufficient to meet the 
health-care demand that VA will face this year. He also emphasized that 
the passage of Public Law 111-163, the ``Caregivers and Veterans 
Omnibus Health Services Act,'' and Public Law 111-148, the ``Patient 
Protection and Affordable Care Act,'' will increase workloads for VA. 
Unfortunately, the House version of the FY 2011 Military Construction 
and Veterans Affairs appropriations bill did not fully address this 
projected current year demand. Likewise, the Senate version of the 
appropriations bill is apparently insufficient to meet the new demand 
the Secretary projects.
    While we appreciate the funding levels that are provided by the 
appropriations bills, we believe that the Secretary's letter sends a 
clear message that, absent some unclear ``management action'' by VA, 
more funding will be needed for FY 2011 for VA Medical Care accounts. 
We hope that as the House and Senate finally complete work on the FY 
2011 Military Construction and Veterans' Affairs appropriations bill, 
proper consideration must be given to this concern.
                          funding for fy 2012
    Last year the Administration recommended an advance appropriation 
for FY 2012 of approximately $50.6 billion in discretionary funding for 
VA medical care. The House Committee on Appropriations supported this 
recommendation in H.R. 1 as well. When combined with the $3.7 billion 
Administration projection for medical care collections, the total 
available operating budget recommended for FY 2012 is approximately 
$54.3 billion. However, included in the President's Budget Request for 
FY 2012, the Administration revised the estimates for Medical Care down 
by $713 million due to the proposed Federal pay freeze (a factor not 
included in H.R. 1).
    The Independent Budget appreciates the increases that the 
Administration has recommended for FY 2012 in its Medical Care budget 
request. However, we have some real concerns with the methods that the 
Administration uses to get to those projected increases. Of particular 
concern to The Independent Budget is an ill-defined contingency fund 
that would provide $953 million more for Medical Services for FY 2012. 
Moreover, we are especially concerned that the VA presumes ``management 
improvements'' of approximately $1.1 billion to be directed toward FY 
2012 and FY 2013. The use of management improvements or efficiencies 
was a gimmick commonly used in the past to reduce the requested level 
of discretionary funding; and yet, rarely did the VA realize any actual 
savings from those gimmicks. Additionally, we are concerned that the VA 
does not clearly define the relationship between the contingency fund 
and the ``management improvements'' that it proposes. Finally, we are 
concerned about the revised estimate in Medical Care Collections from 
the originally projected $3.7 billion (included in last year's advance 
appropriations recommendation and supported by Congress) to now only 
$3.1 billion. Given this revision in estimates, the VA budget request 
may arguably be short at least $600 million in budget authority for 
next year simply based on the revised collection estimate.
    For FY 2012, the Administration recommends $53.9 billion for total 
Medical Care spending. The Independent Budget recommends approximately 
$55.0 billion for total medical care, an increase of $3.4 billion over 
the FY 2011 operating budget level currently proposed in H.R. 1, the 
``Continuing Resolution for FY 2011.'' The medical care appropriation 
includes three separate accounts--Medical Services, Medical Support and 
Compliance, and Medical Facilities--that comprise the total VA health 
care funding level. For FY 2012, The Independent Budget recommends 
approximately $43.8 billion for Medical Services. Our Medical Services 
recommendation includes the following recommendations:

    Current Services Estimate........................... $41,274,505,000
    Increase in Patient Workload........................   1,495,631,000
    Additional Medical Care Program Costs...............   1,010,000,000
                    --------------------------------------------------------
                    ____________________________________________________
        Total FY 2012 Medical Services.................. $43,780,136,000
                    ========================================================
                    ____________________________________________________
    Our growth in patient workload is based on a projected increase of 
approximately 126,000 new unique patients--Priority Group 1-8 veterans 
and covered non-veterans. We estimate the cost of these new unique 
patients to be approximately $1.0 billion. The increase in patient 
workload also includes a projected increase of 87,500 new Operation 
Enduring Freedom and Operation Iraqi Freedom (OEF/OIF) veterans at a 
cost of approximately $306 million.
    Finally, our increase in workload includes the projected enrollment 
of new Priority Group 8 veterans who will use the VA health care system 
as a result of the Administration's continued efforts to incrementally 
increase the enrollment of Priority Group 8 veterans by 500,000 
enrollments by FY 2013. We estimate that as a result of this policy 
decision, the number of new Priority Group 8 veterans who will enroll 
in the VA should increase by 125,000 between FY 2010 and FY 2013. Based 
on the Priority Group 8 empirical utilization rate of 25 percent, we 
estimate that approximately 31,250 of these new enrollees will become 
users of the system. This translates to a cost of approximately $148 
million.
    Last, The Independent Budget believes that there are additional 
projected funding needs for the VA. Specifically, we believe there is 
real funding needed to restore the VA's long-term care capacity (for 
which a reasonable cost estimate can be determined based on the actual 
capacity shortfall of the VA), to provide additional centralized 
prosthetics funding (based on actual expenditures and projections from 
the VA's prosthetics service), and to meet the new projected demand 
associated with the provisions of Public Law 111-163, the ``Caregivers 
and Veterans Omnibus Health Services Act.'' In order to restore the 
VA's long-term care average daily census (ADC) to the level mandated by 
Public Law 106-117, the ``Veterans Millennium Health Care Act,'' we 
recommend $375 million. In order to meet the increase in demand for 
prosthetics, the IB recommends an additional $250 million. This 
increase in prosthetics funding reflects the significant increase in 
expenditures from FY 2010 to FY 2011 (explained in the section on 
Centralized Prosthetics Funding) and the expected continued growth in 
expenditures for FY 2012.
    Finally, we believe that there will be a significant funding need 
in order for the VA to address the provisions of Public Law 111-163, 
specifically as it relates to the caregiver provisions of the law. 
During consideration of the legislation, the costs were estimated to be 
approximately $1.6 billion between FY 2010 and FY 2015. This included 
approximately $60 million identified for FY 2010 and approximately 
$1.54 billion between FY 2011 and FY 2015. However, no funding was 
provided in FY 2011 to address this need. As a result, the VA will have 
an even greater need for funding to support Public Law 111-163 between 
FY 2012 and FY 2015 in order to fully implement these provisions. While 
the Administration claims to have provided an additional $208 million 
for implementation of Public Law 111-163, we remain concerned about the 
lack of action by the VA thus far to actually implement the law. 
Moreover, it is not clear where that additional funding is included in 
the FY 2012 Medical Care budget request. With this in mind, The 
Independent Budget recommends approximately $385 million to fund the 
provisions of Public Law 111-163 in FY 2012.
    For Medical Support and Compliance, The Independent Budget 
recommends approximately $5.4 billion, approximately $50 million above 
the FY 2011 appropriated level. Finally, for Medical Facilities, The 
Independent Budget recommends approximately $5.9 billion, approximately 
$160 million above the FY 2011 appropriated level. While our 
recommendation does not include an additional increase for non-
recurring maintenance (NRM), it does reflect a FY 2012 baseline of 
approximately $1.1 billion. While we appreciate the significant 
increases in the NRM baseline over the last couple of years, total NRM 
funding still lags behind the recommended two to four percent of plant 
replacement value. In fact, the VA should actually be receiving at 
least $1.7 billion annually for NRM (Refer to Construction section 
article ``Increase Spending on Nonrecurring Maintenance).
    For Medical and Prosthetic Research, The Independent Budget 
recommends $620 million. This represents a $39 million increase over 
the FY 2011 appropriated level. We are particularly pleased that 
Congress has recognized the critical need for funding in the Medical 
and Prosthetic Research account in the last couple of years. Research 
is a vital part of veterans' health care, and an essential mission for 
our national health care system.
                   advance appropriations for fy 2013
    As explained previously, Public Law 111-81 required the President's 
budget submission to include estimates of appropriations for the 
medical care accounts for FY 2012 and subsequent fiscal years. With 
this in mind, the VA Secretary is required to update the advance 
appropriations projections for the upcoming fiscal year (FY 2012) and 
provide detailed estimates of the funds necessary for the medical care 
accounts for FY 2013. Moreover, the law also requires a thorough 
analysis and public report of the Administration's advance 
appropriations projections by the Government Accountability Office 
(GAO) to determine if that information is sound and accurately reflects 
expected demand and costs.
    The Independent Budget is pleased to see that the Administration 
has proposed an increase in the Medical Care accounts for FY 2013. We 
simply urge Congress to remain vigilant to ensure that the proposed 
funding levels for FY 2013 are in fact sufficient to meet the continued 
growth in demand on the health care system. Moreover, it is important 
to note that this is the first year that the GAO will examine the 
budget submission to analyze its consistency with VA's Enrollee Health 
Care Projection Model. The Independent Budget looks forward to 
examining all of this new information and incorporating it into future 
budget estimates.
    In the end, it is easy to forget, that the people who are 
ultimately affected by wrangling over the budget are the men and women 
who have served and sacrificed so much for this Nation. We hope that 
you will consider these men and women when you develop your budget 
views and estimates, and we ask that you join us in adopting the 
recommendations of The Independent Budget.

    This concludes my testimony. I will be happy to answer any 
questions you may have.

    Chairman Murray. Thank you very much.
    Mr. Violante.

STATEMENT OF JOSEPH A. VIOLANTE, NATIONAL LEGISLATIVE DIRECTOR, 
                   DISABLED AMERICAN VETERANS

    Mr. Violante. Thank you, Madam Chairman.
    On behalf of the Disabled American Veterans, I am here 
today to present the recommendations of The Independent Budget 
for the Fiscal Year 2012 in the area of veterans' benefits.
    First, however, I want to congratulate you, Chairman 
Murray, on your selection to lead this great Committee. I also 
want to welcome back Ranking Minority Member Burr. The DAV 
looks forward to working together with both of you and all 
Members of the Committee and your staff to improve the lives of 
our Nation's veterans, particularly disabled veterans, their 
families, and survivors.
    I also want to extend a special ``Aloha'' to former 
Chairman Akaka. His leadership over the past 4 years 
contributed to historic achievements for veterans.
    Madam Chairman, for fiscal year 2012, The Independent 
Budget recommends only modest increases in personnel levels for 
the Veterans Benefits Administration, and those increases are 
targeted primarily at Vocational Rehabilitation and Employment 
Service and the Board of Veterans Appeals.
    The voc rehab program is one of the most important benefits 
provided to disabled veterans. However, a 2009 study by the 
Government Accountability Office found that 54 percent of 
Veterans Affairs Regional Offices reported they had fewer voc 
rehab counselors than needed. The current caseload target is 
one counselor for every 125 veterans, but that ratio is 
reported to be as high as 1 to 160.
    Therefore, the IB supports an increase of 100 new 
counselors and an additional 50 FTEE dedicated to management 
and oversight of the growing number of contract counselors and 
service providers.
    The Board of Veterans Appeals workload has consistently 
averaged about 5 percent of the total number of claims before 
VBA. So as claims rise, so too do the number of appeals. To 
meet that new demand and to avoid creating an even larger 
backlog of appeals, the IB recommends funding increases for the 
Board that are commensurate with the increased workload.
    Madam Chairman, the IB once again calls on Congress to 
completely end the ban on concurrent receipt for all disabled 
veterans and eliminates the SBP/DIC offset for veterans, 
widows, and dependents.
    Madam Chairman, VA is at a critical junction in its efforts 
to reform an outdated, inefficient, and overwhelmed claims 
processing system. Secretary Shinseki has made clear his 
intention to, ``break the back of the backlog,'' as a top 
priority; and while we welcome this goal, we would caution that 
eliminating that backlog is not necessarily the same as 
reforming the claims process system.
    To achieve real and lasting success, the VA must focus on 
creating a veteran's benefits claims processing system designed 
to decide each claim right the first time.
    Undoubtedly, the most important new initiative underway is 
the Veteran's Benefits Management System, VBMS, their new IT 
program being designed to provide a paperless and rules-based 
method of processing and awarding claims.
    We would urge Congress to carefully monitor and oversee 
this work and recommend considering an independent outside 
expert review of the VBMS.
    However, regardless of the IT solutions, VBA must ensure 
that they have a properly trained workforce and a comprehensive 
quality control system.
    That concludes my statement. I will be happy to answer any 
questions the Committee may have.
    [The prepared statement of Mr. Violante follows:]
    Prepared Statement of Joseph A. Violante, National Legislative 
  Director, Disabled American Veterans, on Behalf of The Independent 
                                 Budget
    Chairman Murray, Ranking Member Burr and Members of the Committee: 
On behalf of the Disabled American Veterans and our 1.2 million 
members, all of whom are wartime disabled veterans, I am pleased to be 
here today to present the recommendations of The Independent Budget for 
the fiscal year 2012 budget in the area of veterans' benefits. As you 
know, The Independent Budget is a collaboration amongst the DAV, 
AMVETS, Paralyzed Veterans of America and Veterans of Foreign Wars.
    First, however, I want to congratulate you, Chairman Murray, on 
your selection to lead this great Committee. I also want to welcome 
back the Committee's Ranking Minority Member, Richard Burr. The DAV 
looks forward to working together with both of you, as well as all of 
the returning and new Members of the Committee, to improve the lives of 
our Nation's veterans, particularly disabled veterans, their families 
and survivors.
    I also want to extend a special ``Aloha'' to former Chairman Akaka. 
Your leadership over the past four years contributed to historic 
achievements for veterans, including enactment of the Veterans Health 
Care Budget Reform and Transparency Act of 2009 and the Caregiver and 
Veterans Omnibus Health Services Act of 2010.
    For the past 25 years, The Independent Budget has provided Congress 
and the Administration with budget and policy recommendations to 
strengthen programs serving America's veterans. I note with 
appreciation that Public Law 111-275, the Veterans Benefits Act of 
2010, which was enacted in the last Congress, contained a number of 
provisions addressing recommendations made to this Committee by The 
Independent Budget. In particular, the new law includes an increase in 
the automobile grant from $11,000 to $18,900; an expansion of 
eligibility for Aid and Attendance benefits for veterans suffering from 
Traumatic Brain Injury; an increase in Supplemental Service-Disabled 
Veterans' Insurance (SDVI or ``RH'') from $20,000 to $30,000; and an 
increase in Veterans Mortgage Life Insurance (VMLI) for disabled 
veterans from $90,000 to $150,000 effective October 1, 2011, with a 
2012 increase to $200,000. Each of these and many other provisions in 
this new law will make a real difference in the lives of thousands of 
disabled veterans and their families and we thank this Committee for 
helping to enact this legislation.
      sufficient staffing for the veterans benefits administration
    Madame Chairman, for fiscal year 2012, The Independent Budget 
recommends only modest increases in personnel levels for the Veterans 
Benefits Administration (VBA), and those increases are targeted at 
Vocational Rehabilitation and Employment (VR&E) and the Board of 
Veterans Appeals (BVA). Over the past couple of years, with strong 
support from Congress, VBA's Compensation and Pension (C&P) Service has 
seen a significant increase in personnel to address the rapidly rising 
workload they face. It is important to note that this large increase in 
claims processors could actually result in a short-term net decrease in 
productivity, due to experienced personnel being taken out of 
production to conduct training, and the length of time it takes for new 
employees to become fully productive. While we do not recommend 
additional staffing increases at this time, we do recommend that VBA 
conduct a study on how to determine the proper number of full-time 
employees necessary to manage its growing claims inventory so that 
claims are decided accurately and in a timely manner.
    The Independent Budget does, however, recommend that Congress 
authorize at least 160 additional full-time employees for the VR&E 
Service for fiscal year (FY) 2012, primarily to reduce current case 
manager workload. A 2009 study by the Government Accountability Office 
(GAO) found that 54 percent of Department of Veterans Affairs Regional 
Offices (VAROs) reported they had fewer counselors than they needed and 
40 percent said they had too few employment coordinators. VR&E 
officials indicated that the current caseload target is 1 counselor for 
every 125 veterans, but that ratio is reported to be as high as 1 to 
160 in the field. An increase of 100 new counselors would address that 
gap. Given its increased reliance on contract services, VR&E also needs 
an additional 50 full-time employee equivalents (FTEE) dedicated to 
management and oversight of contract counselors and rehabilitation and 
employment service providers. In addition, VR&E has requested at least 
10 FTEE in FY 2012 to expand its college program--``Veteran Success on 
Campus,'' and we support that request.
    With the number of claims for benefits increasing over the past 
several years, so too is the number of appeals to the BVA. On average, 
BVA receives appeals on 5 percent of all claims, a rate that has been 
consistent over the past decade. With the number of claims projected to 
rise significantly in the coming years, so too will the workload at 
BVA, and thus the need for additional personnel. Funding for the BVA 
must rise at a rate commensurate with its increasing workload so it is 
properly staffed to decide veterans' appeals in an accurate and timely 
manner.
         claims processing reform: get it right the first time
    The VBA is at a critical juncture in its efforts to reform an 
outdated, inefficient, and overwhelmed claims-processing system. After 
struggling for decades to provide timely and accurate decisions on 
claims for veterans' benefits, the VBA over the past year has started 
down a path that may finally lead to essential transformation and 
modernization, but only if it has the leadership necessary to undergo a 
cultural shift in how it approaches the work of adjudicating claims for 
veterans benefits.
    The number of new claims for disability compensation has risen to 
more than 1 million per year and the complexity of claims have also 
increased as complicated new medical conditions, such as Traumatic 
Brain Injury, have become more prevalent. To meet rising workload 
demands, The Independent Budget has recommended, and Congress has 
provided, significant new resources to the VBA over the past several 
years in order to increase their personnel levels. Yet despite the 
hiring of thousands of new employees, the number of pending claims for 
benefits, often referred to as the backlog, continues to grow.
    As of January 31, 2011, there were 775,552 pending claims for 
disability compensation and pensions awaiting rating decisions by the 
VBA, an increase of 289,081 from one year ago. About 41 percent of that 
increase is the result of the Secretary's decision to add three new 
presumptive conditions for Agent Orange (AO) exposure: ischemic heart 
disease, B-cell leukemia, and Parkinson's disease. Even discounting 
those new AO-related claims, the number of claims pending rose by 
171,522, a 37 percent increase of pending claims over just the past 
year. Overall, there are 331,299 claims that have been pending greater 
than VA's target of 125 days, which is an increase of 147,930, up more 
than 80 percent in the past year. Not counting the new AO-related, over 
50 percent of all pending claims for compensation or pension are now 
past the 125-day target set by the VBA.
    Worse, by the VBA's own measurement, the accuracy of disability 
compensation rating decisions continues to trend downward, with their 
quality assurance program, known as the Systematic Technical Accuracy 
Review (STAR) reporting only an 83 percent accuracy rate for the 12-
month period ending May 31, 2010. Moreover, VA's Office of Inspector 
General found additional undetected or unreported errors that increased 
the error rate to 22 percent. Complicating the Department's problems is 
its reliance on an outdated, paper-centric processing system, which now 
includes more than 4.2 million claims folders.
    Faced with all of these problems, VA Secretary Shinseki last year 
set an extremely ambitious long-term goal of zero claims pending more 
than 125 days and all claims completed to a 98 percent accuracy 
standard. Throughout the year he repeatedly made clear his intention to 
``break the back of the backlog'' as his top priority. While we welcome 
his intention and applaud his ambition, we would caution that 
eliminating the backlog is not necessarily the same goal as reforming 
the claims-processing system, nor does it guarantee that veterans are 
better served.
    The backlog is not the problem, nor even the cause of the problem; 
rather, it is only one symptom, albeit a very severe one, of a much 
larger problem: too many veterans waiting too long to get decisions on 
claims for benefits that are too often wrong. If the VBA focuses simply 
on getting the backlog number down, it can certainly achieve numeric 
success in the near term, but it will not necessarily have addressed 
the underlying problems nor taken steps to prevent the backlog from 
eventually returning. To achieve real success, the VBA must focus on 
creating a veterans' benefits claims-processing system designed to 
``get each claim done right the first time.'' Such a system would be 
based upon a modern, paperless information technology and workflow 
system focused on quality, accuracy, efficiency, and accountability.
    Recognizing all of the problems and challenges discussed above, we 
have seen some positive and hopeful signs of change. VBA leadership has 
been refreshingly open and candid in recent statements on the problems 
and need for reform. Over the past year, dozens of new pilots and 
initiatives have been launched, including a major new IT system that is 
now being field-tested. The VBA has shared information with the 
veterans service organizations (VSOs) about its ongoing initiatives and 
sought feedback on these initiatives. These are all positive 
developments.
    Yet despite the new openness and outreach to the VSO community, we 
remain concerned about VBA's failure to fully integrate service 
organizations in reforming the claims process. VSOs not only bring vast 
experience and expertise about claims processing, but our local and 
national service officers hold power of attorney for hundreds of 
thousands of veterans and their families. In this capacity, VSOs are an 
integral component of the claims process. We make the VBA's job easier 
by helping veterans prepare and submit better claims, thereby requiring 
less time and resources to develop and adjudicate them. VBA leadership 
must commit to a true partnership with service organizations, and 
infuse this new attitude throughout the VBA from central office down to 
each of the 57 regional offices.
    Madame Chairman, the VBA must also change how it measures success 
and rewards performance in a manner designed to achieve the goal of 
``getting it right the first time.'' Unfortunately, most of the 
measures that the VBA employs today, whether for the organization as a 
whole, or for regional offices or employees, are based primarily on 
measures of production, which reinforces the goal of ending the 
backlog. VBA must change how it measures and reports progress and 
success so that there are more and better indicators of quality and 
accuracy. VBA must also continue to review employee performance 
standards to ensure that it creates incentives and accountability to 
achieve quality and accuracy, not just increased speed or production.
                             pilot programs
    As the VBA moves forward with dozens of pilots and initiatives 
designed to modernize and streamline the claims-processing system, it 
is imperative that the VBA have a systematic method for analyzing and 
integrating ``best practices'' that improve quality and accuracy, 
rather than just those that may increase production. One of the most 
important new initiatives is the use of templates for medical evidence, 
which VBA calls Disability Benefits Questionnaires (DBQs). There are 
currently three DBQs that have been approved for use in claims for the 
three new presumptive conditions associated with Agent Orange exposure: 
ischemic heart disease, Parkinson's disease, and B-cell leukemia. An 
additional 76 DBQs are in various stages of the development and 
approval process. We support the use of DBQs as a method to streamline 
and improve the quality and timeliness of decisions; however, it is 
crucial that DBQs are properly completed, either by VA or private 
medical examiners. VBA employees must be properly trained so they 
understand that DBQs are but one piece of evidence that must be 
considered in the development and decisionmaking process. VBA's rating 
specialists must properly consider the evidentiary weight and value of 
all evidence related to the claim and address it adequately in the 
reason and bases of the subsequent decision.
    One of the major new claims process reform initiatives is the Fully 
Developed Claims (FDC) program, which began as a pilot program mandated 
by Public Law 110-389, and was rolled out to all VAROs last year. We 
were pleased that VBA modified the FDC application process at our 
request so that a veteran could make an informal notification to the 
VBA of his or her intention to file a FDC claim, thereby protecting the 
earliest effective date for receipt of benefits. However, we have been 
hearing numerous reports from the field that local ROs are not allowing 
such informal claims to be made. We have also been told that the 
participation level of veterans in the FDC program remains low. We 
continue to believe in the FDC program and urge this Committee to work 
with us and VBA to address the obstacles to its success.
    In order to synthesize the ``best practices'' from all of the 
ongoing pilots, VBA recently started a new Integration Laboratory at 
their Indianapolis Regional Office. Given all of the pressure to 
``break the backlog'' by increasing production, we have concerns about 
whether the VBA will successfully extract and then integrate the best 
practices from so many ongoing initiatives. Given the enormous pressure 
to reduce the backlog, we are concerned that there could be a tendency 
to focus on process improvements that result in greater production 
rather than those that lead to greater quality and accuracy.
    Congress must continue to provide aggressive oversight of the VBA's 
myriad ongoing pilots and initiatives to ensure that practices adopted 
and integrated into a cohesive new claims process are judged first and 
foremost on their ability to help VA get claims ``done right the first 
time.''
                      training and quality control
    Madame Chairman, two longstanding weaknesses of VBA's claims 
adjudication process are training and quality control, which should be 
linked to create a single continuous improvement program, both for 
employees and for the claims process itself. Quality control programs 
can identify areas and subjects that require new or additional training 
for VBA employees and better training programs for employees and 
managers should improve the overall quality of the VBA's work.
    VBA's primary quality assurance program is the STAR program. The 
STAR program was last evaluated by the VA Office of Inspector General 
(OIG) in March 2009, with the OIG finding that STAR does not provide a 
complete assessment of rating accuracy. Although the STAR reviewers 
found that the national accuracy rate was about 87 percent, the OIG 
found additional errors and projected an overall accuracy rate of only 
78 percent. In addition to rectifying errors found by the OIG, we 
recommend that the VBA establish a true quality control program that 
looks at claims ``in-process'' in order to determine not just whether a 
proper decision was made, but how it was arrived at in order to 
identify ways to improve the system. The data from all such reviews 
should be incorporated into the VBA's new information technology 
systems being developed so that analysis can provide management and 
employees important insights into processes and decisions. This in turn 
would lead to quicker and more accurate decisions on benefits claims, 
and most important, the delivery of all earned benefits to veterans, 
particularly disabled veterans, in a timely manner.
    Training is essential to the professional development of an 
individual and tied directly to the quality of work they produce, as 
well as the quantity they can accurately produce. Veterans service 
organization officers have been told by many VBA employees that meeting 
production goals is the primary focus of management, whereas fulfilling 
training requirements and increasing quality is perceived as being 
secondary. An overemphasis on productivity must not interfere with the 
training of new employees who are still learning their job.
    The Government Accountability Office (GAO) recently conducted a 
study to determine the appropriateness of training for experienced 
claims processors and the adequacy of VBA's monitoring and assessment 
of such training. Of particular interest are GAO findings that 
experienced claims processors' had concerns with the training 
received--specifically the hours, amount, helpfulness, methods, and 
timing of training. Likewise, as the GAO report pointed out, there is 
very little done by the VBA to ensure the required training is 
completed or to assess the adequacy and consistency of the training, 
nor to properly ascertain the total number of employees who have met 
the annual training requirement. In fact, only one VARO met the annual 
training requirement and nine VAROs had less than half their employees 
meet the annual training requirement. It is simply unacceptable to have 
only one VARO meeting the most basic requirement of ensuring that all 
its employees complete 80 hours of training. VBA must place greater 
emphasis on training by implementing stricter monitoring mechanisms for 
all VAROs and ensuring that they are held accountable for failure to 
meet this minimal standard.
    Madame Chairman, Public Law 110-389, the ``Veterans' Benefits 
Improvement Act of 2008,'' required the VBA to develop and implement a 
certification examination for claims processors and managers; however, 
today there are still gaps in the implementation of these provisions. 
While tests have been developed and piloted for Veterans Service 
Representatives (VSRs) and Rating Veterans Service Representatives 
(RVSRs), additional tests need to be developed and deployed for 
Decision Review Officers and supervisory personnel. None of these 
certification tests are mandatory for all employees, nor are they done 
on a continuing basis.
    The VBA cannot accurately assess its training or measure an 
individual's knowledge, understanding, or retention of the training 
material without regular testing. It is important, however, that all 
testing and certification be applied equally to employees and to the 
people who supervise and manage them. All VBA employees, coaches, and 
managers should undergo regular testing to measure job skills and 
knowledge, as well as the effectiveness of the training.
    Equally important, testing must properly assess the skills and 
knowledge required to perform the work of processing claims. Many 
employees report that the testing does not accurately measure how well 
they perform their jobs, and there have been reports that significant 
numbers of otherwise qualified employees are not able to pass the 
tests. VBA must ensure that certification tests are developed that 
accurately measure the skills and knowledge needed to perform the work 
of VSRs, RVSRs, decision review officers, coaches and other managers.
    Successful completion of training by all employees and managers 
must be an absolute requirement for every VARO and must be a shared 
responsibility of both employees and management. Managers must be held 
responsible for ensuring that training is offered and completed by all 
of their employees. However it is also the responsibility, as well as 
part of the performance standard, for employees to complete their 
training requirements. Managers must provide employees with the time to 
take training and employees must fully and faithfully complete their 
training as offered. Neither should be able or pressured to just 
``check the box'' when it comes to training.
                 new vba information technology systems
    Madame Chairman, undoubtedly the most important new initiative 
underway at the VBA is the Veterans Benefits Management System (VBMS), 
which is designed to provide the VBA with a comprehensive, paperless, 
and ultimately rules-based method of processing and awarding claims for 
VA benefits, particularly disability compensation and pension. 
Following initial design work, the VBMS had its first phase of 
development in Baltimore last year where a prototype system was tested 
in a virtual regional office environment. The first actual pilot of the 
VBMS was begun in November 2010 at the Providence, Rhode Island 
Regional Office. The six-month pilot program began with simulated 
claims and was scheduled to begin working on actual ``live'' claims 
early this year. A second six-month pilot is expected to begin in 
May 2011 at the Salt Lake City Regional Office, which will build on the 
work begun at Providence. A third pilot is scheduled to begin in 
November 2011 at an undesignated location, and the final national 
rollout of the VBMS is schedule to take place in 2012.
    Although the development and deployment of a modern information 
technology (IT) system to process claims in a paperless environment is 
long overdue, we have concerns about whether the VBMS is being rushed 
to meet self-imposed deadlines in order to show progress toward 
``breaking the back of the backlog.'' While we have long believed that 
the VBA's IT infrastructure was insufficient, outdated, and constantly 
falling further behind modern software, Web, and cloud-based technology 
standards, we would be equally concerned about a rushed solution that 
ultimately produces an insufficiently robust IT system.
    Given the highly technical nature of modern IT development, we 
would urge Congress to fully explore these issues with the VBA and 
suggest that it could be helpful to have an independent, outside, 
expert review of the VBMS while it is still early enough in the 
development phase to make course corrections, should they be necessary.
    To be successful, the VBMS must include the maximum level of rules-
based decision support feasible at the earliest stages of development 
in order to build a system capable of providing accurate and timely 
decisions, as well as include real-time, quality control as a core 
component of the system. VBA must also commit to incorporating all 
veterans' legacy paper files into the paperless environment of the VBMS 
within the minimum amount of time technically and practically feasible.
              disability compensation and quality of life
    The Institute of Medicine (IOM) Committee on Medical Evaluation of 
Veterans for Disability Compensation published a report in 2007, ``A 
21st Century System for Evaluating Veterans for Disability Benefits,'' 
recommending that the current VA disability compensation system be 
expanded to include compensation for nonwork disability (also referred 
to as ``noneconomic loss) and loss of quality of life. Nonwork 
disability refers to limitations on the ability to engage in usual life 
activities other than work. This includes ability to engage in 
activities of daily living, such as bending, kneeling, or stooping, 
resulting from the impairment, and to participate in usual life 
activities, such as reading, learning, socializing, engaging in 
recreation, and maintaining family relationships. Loss of quality of 
life refers to the loss of physical, psychological, social, and 
economic well-being in one's life.
    The IOM report stated that, ``* * * Congress and VA have implicitly 
recognized consequences in addition to work disability of impairments 
suffered by veterans in the Rating Schedule and other ways. Modern 
concepts of disability include work disability, nonwork disability, and 
quality of life (QOL) * * *'' The congressionally-mandated Veterans 
Disability Benefits Commission (VDBC), established by the National 
Defense Authorization Act of 2004 (Public Law 108-136), spent more than 
two years examining how the rating schedule might be modernized and 
updated. Reflecting the recommendations of the IOM study, the VDBC in 
its final report issued in 2007 recommended that the, ``* * * veterans 
disability compensation program should compensate for three 
consequences of service-connected injuries and diseases: work 
disability, loss of ability to engage in usual life activities other 
than work, and loss of quality of life.''
    The IOM Report, the VDBC (and an associated Center for Naval 
Analysis study) and the Dole-Shalala Commission (President's Commission 
on Care for America's Returning Wounded Warriors) all agreed that the 
current benefits system should be reformed to include noneconomic loss 
and quality of life as a factor in compensation.
    The Independent Budget recommends that Congress finally address 
this deficiency by amending title 38, United States Code, to clarify 
that disability compensation, in addition to providing compensation to 
service-connected disabled veterans for their average loss of earnings 
capacity, must also include compensation for their noneconomic loss and 
for loss of their quality of life. Congress and VA should then 
determine the most practical and equitable manner in which to provide 
compensation for noneconomic loss and loss of quality of life and then 
move expeditiously to implement this updated disability compensation 
program.
      elimination of concurrent receipt for all disabled veterans
    Madame Chairman, many veterans retired from the Armed Forces based 
on longevity of service must forfeit a portion of their retired pay, 
earned through faithful performance of military service, before they 
receive VA compensation for service-connected disabilities. This is 
inequitable--military retired pay is earned by virtue of a veteran's 
career of service on behalf of the Nation, careers of usually more than 
20 years. Entitlement to compensation, on the other hand, is paid 
solely because of disability resulting from military service, 
regardless of the length of service.
    A disabled veteran who does not retire from military service but 
elects instead to pursue a civilian career after completing a service 
obligation can receive full VA compensation and full civilian retired 
pay--including retirement from any Federal civil service. A veteran who 
honorably served and retired for 20 or more years and suffers from 
service-connected disabilities due to disability should have that same 
right.
    Congress should enact legislation to repeal the inequitable 
requirement that veterans' military longevity retired pay be offset by 
an amount equal to their rightfully earned VA disability compensation 
if rated less than 50 percent.
             repeal of offset against survivor benefit plan
    When a disabled veteran dies of service-connected causes, or 
following a substantial period of total disability from service-
connected causes, eligible survivors or dependents receive Dependency 
and Indemnity Compensation (DIC) from VA. This benefit indemnifies 
survivors, in part, for the losses associated with the veteran's death 
from service-connected causes or after a period of time when the 
veteran was unable, because of total disability, to accumulate an 
estate for inheritance by survivors.
    Career members of the Armed Forces earn entitlement to retired pay 
after 20 or more years' service. Unlike many retirement plans in the 
private sector, survivors have no entitlement to any portion of the 
member's retired pay after his or her death. Under the Survivor Benefit 
Program (SBP), deductions are made from the member's retired pay to 
purchase a survivors' annuity. Upon the veteran's death, the annuity is 
paid monthly to eligible beneficiaries under the plan. If the veteran 
died of other than service-connected causes or was not totally disabled 
by service-connected disability for the required time preceding death, 
beneficiaries receive full SBP payments. However, if the veteran's 
death was a result of his or her military service or followed from the 
requisite period of total service-connected disability, the SBP annuity 
is reduced by an amount equal to the DIC payment. Where the monthly DIC 
rate is equal to or greater than the monthly SBP annuity, beneficiaries 
lose all entitlement to the SBP annuity.
    We strongly believe this offset is inequitable because no 
duplication of benefits is involved. Payments under the SBP and DIC 
programs are made for different purposes. Under the SBP, a dependent 
purchases coverage that would be paid in the event of the death of the 
servicemember. On the other hand, DIC is a special indemnity 
compensation paid to the survivor of a servicemember who dies while 
serving or a veteran who dies from service-connected disabilities. In 
such cases, VA indemnity compensation should be added to the SBP, not 
substituted for it.
    We note that surviving spouses of Federal civilian retirees who are 
veterans are eligible for dependency and indemnity compensation without 
losing any of their purchased Federal civilian survivor benefits. The 
offset penalizes survivors of military retired veterans whose deaths 
are under circumstances warranting indemnification from the government 
separate from the annuity funded by premiums paid by the veteran from 
his or her retired pay. Congress should repeal the offset between DIC 
and the SBP.
    In addition, Congress should lower the age required for survivors 
of veterans who died from service-connected disabilities who remarry to 
be eligible for restoration of dependency and indemnity compensation to 
conform with the requirements of other Federal programs. Current law 
permits the VA to reinstate DIC benefits to remarried survivors of 
veterans if the remarriage occurs at age 57 or older or if survivors 
who have already remarried apply for reinstatement of DIC at age 57. 
Although we appreciate the action Congress took to allow this 
restoration of rightful benefits, the current age threshold of 57 years 
is arbitrary. Remarried survivors of retirees of the Civil Service 
Retirement System, for example, obtain a similar benefit at age 55. We 
believe the survivors of veterans who died from service-connected 
disabilities should not be further penalized for remarriage and that 
equity with beneficiaries of other Federal programs should govern 
Congressional action for this deserving group.
                  va schedule for rating disabilities
    The amount of disability compensation paid to a service-connected 
disabled veteran is determined according to the VA Schedule for Rating 
Disabilities (VASRD), which is divided into 15 body systems with more 
than 700 diagnostic codes. In 2007, both the VDBC, as well as the IOM 
Committee on Medical Evaluation of Veterans for Disability Compensation 
in its report ``A 21st Century System for Evaluating Veterans for 
Disability Benefits,'' recommended that VA regularly update the VASRD 
to reflect the most up-to-date understanding of disabilities and how 
disabilities affect veterans' earnings capacity.
    In line with these recommendations, the VBA is currently engaged in 
the process of updating the 15 body systems, beginning with mental 
disorders and the musculoskeletal system. Additionally, it has 
committed to regularly updating the entire VA Schedule for Rating 
Disabilities every five years.
    In January 2010, the VBA held a Mental Health Forum jointly with 
the Veterans Health Administration (VHA), which included a VSO panel. 
In August 2010, the VBA and VHA held a Musculoskeletal Forum, which 
also included a VSO panel. Just a few weeks ago, a series of four 
public forums were held in Scottsdale, Arizona over the course of two 
weeks on four additional body systems. The Arizona sessions in 
particular, were far removed from the public and offered little 
opportunity for most VSOs to observe, much less offer any input.
    While we are appreciative of such efforts, we are concerned that 
except for these initial public forums, VBA is not making any 
substantial efforts to include VSO input during the actual development 
of draft regulations for the updated rating schedule. Since the initial 
public meetings, the VBA has not indicated it has any plans to involve 
VSOs at any other stage of the rating schedule update process other 
than what is required once a draft rule is published, at which time 
they are required by law to open the proposed rule to all public 
comment. We strongly believe that the VBA would benefit from the 
collective and individual experience and expertise of VSOs and our 
service officers throughout the process of revising the rating 
schedule. In addition, since the VBA is committed to a continuing 
review and revision of the rating schedule, we believe it would be 
beneficial to conduct reviews of the revision process so that future 
body system rating schedule updates can benefit from ``lessons 
learned'' during prior body system updates.

    Madame Chairman and Members of the Committee, this concludes my 
statement and I would be happy to answer any questions you may have.

    Chairman Murray. Thank you very much.
    Ms. Roof.

    STATEMENT OF CHRISTINA M. ROOF, NATIONAL ACTING DEPUTY 
                  LEGISLATIVE DIRECTOR, AMVETS

    Ms. Roof. Chairman Murray, Ranking Member Burr, and 
distinguished Members of the Committee, on behalf of AMVETS, I 
would like to thank you for inviting me and the other 
Independent Budget organization representatives to share with 
you our recommendations on the Department of Veterans' Affairs 
Fiscal Year 2012 Budget. We believe our recommendations will 
prove to be the most fiscally responsible way of ensuring the 
quality and integrity of the care and benefits our veterans 
community depend on and receive today.
    As a partner of The Independent Budget, AMVETS devotes a 
majority of our time to the concerns and matters of VA's 
National Cemetery Administration, or NCA, and to VA 
entrepreneurship, as well as Federal procurement. Today I will 
briefly be speaking to these issues.
    The most important obligation of NCA is to honor the memory 
of America's brave men and women who have served in the Armed 
Forces.
    As of late 2010, NCA maintained more than three million 
graves at 131 national cemeteries in 39 States and in Puerto 
Rico.
    With the anticipated opening of several new national 
cemeteries, annual internments are projected to increase to 
approximately 116,000 in 2013 and maintain at that level 
through 2015.
    The IB recommends a total operating budget of $275 million 
for NCA for fiscal year 2012. This is so that NCA may meet the 
increasing demands of interments, gravesite maintenance, and 
related essential elements of cemetery operations.
    Furthermore, due to the challenges that the State Cemetery 
Grants Program is experiencing in meeting the growing demand 
for their services, the IB recommends Congress appropriate $51 
million to the State Cemetery Grants Program for fiscal year 
2012.
    This funding level will allow SCGP to establish new State 
cemeteries at their current rate of need and will provide 
burial options for veterans that otherwise would have no 
reasonably access to a State or national cemetery.
    In 1973, NCA established a burial allowance that provided 
partial reimbursements for the costs of funerals. However, 
while the cost of funerals has risen over 700 percent since 
1973, the VA benefit has only been raised 250 percent.
    We call on the Administration and Congress to provide the 
resources required to meet the critical nature of NCA's mission 
and to fulfill this Nation's commitment to all veterans who 
have served their country so honorably and faithfully.
    AMVETS' second focus in the fiscal year 2012 IB is on 
veteran entrepreneurship and Federal procurement, as it relates 
to service-disabled veteran-owned small businesses and 
veterans-owned small businesses. While I do note that a 
majority of the proceeding information is focused on policy 
rather than hard fiscal numbers, we believe that identifying 
broken policies, duplication of efforts, and lack of oversight 
are key factors in determining a fiscally responsible budget.
    Supporting service-disabled veteran-owned small businesses 
and veteran-owned small businesses contributes significantly in 
sustaining a veteran's quality of life, while also contributing 
to the success of transitioning from military life to civilian 
life.
    Given the current state of our economy, now more than ever, 
Federal agencies must be held accountable to meeting the 3 
percent Federal procurement goal as outlined by Executive Order 
13360 and Section 36 of the Small Business Act.
    Furthermore, Congress must ensure adequate resources are 
available to effectively monitor and recognize those agencies 
not meeting the 3-percent goal, and hold them accountable to 
their failure.
    Another critical part of protecting our veterans in the 
Federal procurement system is through a centralized vendor 
verification system.
    Thus far VA has been awarded $1.4 billion in Recovery Act 
funds to aid our veterans in their entrepreneurial endeavors. 
According to VA, of the Recovery Act funds they have received, 
$538 million have been awarded to veteran-owned small 
businesses.
    However, we have really serious concerns due to the lack of 
verification processes at VA on how many of those awarded 
contracts were to legitimate veteran-owned businesses. Even 
though changes were made to the CFR regarding the verification 
process last year, we believe the minor updates still leave the 
veteran-owned business verification system and VA open to 
fraud.
    A continued lack of clarity and inconsistent status 
verification processes will continue to cause the same unwanted 
results of many service-disabled veteran-owned small businesses 
and veteran-owned small businesses not receiving the 
protections they are entitled to under the law.
    In closing, I want to encourage each of the Committee 
Members to review my full written testimony which will outline 
all of the IB's concerns and recommendations regarding NCA, 
veteran entrepreneurial and Federal procurement.
    Again, Chairman Murray, Ranking Member Burr, and Members of 
the Committee, we thank you for inviting us to share with you 
our recommendations, and I am ready to answer any questions 
that you may have.
    [The prepared statement of Ms. Roof follows:]
 Prepared Statement of Christina M. Roof, National Deputy Legislative 
                            Director, AMVETS
    Chairman Murray, Ranking Member Burr and Distinguished Members of 
the Committee: On behalf of AMVETS I would like to thank you for 
allowing myself and representatives of the other member organization 
authors of the Independent Budget to share with you our recommendations 
on the Department of Veterans Affairs Fiscal Year 2012 budget, in what 
we believe to be the most fiscally responsible way of ensuring the 
quality and integrity of the care and benefits our veterans community 
receive.
    AMVETS is honored to join our fellow Veterans' Service 
Organizations in presenting the Independent Budget's recommendations on 
the Fiscal Year 2012 Department of Veterans Affairs Budget Request. 
AMVETS testifies before you as a co-author of The FY 2012 Independent 
Budget. This is the 25th year AMVETS, the Disabled American Veterans, 
the Paralyzed Veterans of America and the Veterans of Foreign Wars have 
combined our expertise, experiences and resources to produce this 
unique and in-depth document; one that has stood the test of time.
    In developing the Independent Budget we are always guided by the 
same set of principles. These principles include, first, our belief 
that veterans should not have to wait for the benefits to which they 
are entitled through their service to our country. Second, every 
veteran must be ensured access to the highest quality medical care 
available. Third, specialized care must remain a top priority and focus 
of the Department of Veterans Affairs (VA). Furthermore, we believe 
veterans must be guaranteed timely access to the full continuum of 
health care services, including, but not limited to, long-term care. 
Finally, veterans must be assured accessible burial in a state or 
national cemetery regardless of their location.
    As a partner of the Independent Budget, AMVETS devotes a majority 
of our time to the concerns and matters of the Department of Veterans 
Affairs National Cemetery Administration (NCA) and to all of the 
aspects of veteran entrepreneurship and Federal procurement. Today I 
will be speaking directly to these two issues.
    By way of background, the stated mission of The National Cemetery 
Administration (NCA) is to honor veterans with final resting places in 
national shrines and with lasting tributes that commemorate their 
service to our Nation. Their vision is to serve all veterans and their 
families with the utmost dignity, respect, and compassion and ensure 
that every national cemetery will be a place that inspires visitors to 
understand and appreciate the service and sacrifice of our Nation's 
veterans. Furthermore, many states have established state veterans 
cemeteries. Eligibility is similar to that of the Department of 
Veterans Affairs (VA) national cemeteries, but may include residency 
requirements. Even though they may have been established or improved 
with government funds through VA's State Cemetery Grants Program, state 
veterans cemeteries are run solely by the states.
    As of late 2010 the Department of Veterans Affairs National 
Cemetery Administration (NCA) maintained more than 3 million graves at 
131 national cemeteries in 39 states and Puerto Rico. Of these 
cemeteries, 71 are open to all interment; 19 will accept only cremated 
remains and family members of those already interred; and 41 will only 
perform interments of family members in the same gravesite as a 
previously deceased family member.\1\ 
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    \1\ http://www.cem.va.gov/cem/cems/listcem.asp
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    VA estimates nearly 23 million veterans are living today. They 
include veterans from World Wars I and II, the Korean War, the Vietnam 
War, the Gulf War, the conflicts in Afghanistan and Iraq, the Global 
War on Terrorism, as well as peacetime veterans. With the anticipated 
opening of the newly planned national cemeteries, annual interments are 
projected to increase to approximately 116,000 in 2013, and are 
projected to maintain that level through 2015. Historically, only 12 
percent of veterans opt for burial in a state or national cemetery, 
although these numbers are rising.
    The most important obligation of the NCA is to honor the memory of 
America's brave men and women who served in the Armed Forces. 
Therefore, the purpose of these cemeteries as national shrines is one 
of NCA's top priorities. Many of the individual cemeteries within the 
system are steeped in history and the monuments, markers, grounds and 
related memorial tributes represent the very foundation of the United 
States. With this understanding, the grounds, including monuments and 
individual sites of interment, represent a national treasure that must 
be protected, respected and cherished.
    The Independent Budget Veterans Service Organizations (IBVSOs) 
would like to acknowledge the dedication and commitment of the NCA 
staff who continue to provide the highest quality of service to 
veterans and their families. We call on the Administration and Congress 
to provide the resources needed to meet the changing and critical 
nature of NCA's mission and fulfill the Nation's commitment to all 
veterans who have served their country honorably and faithfully.
    In FY 2010, $250 million was appropriated for the operations and 
maintenance of NCA, with approximately $2 million in carryover. NCA 
awarded 47 of its 50 minor construction projects that were in the 
operating plan. Additionally, the State Cemetery Grants Service (SCGS) 
awarded $48.5 million in grants for 12 projects.
    NCA has done an exceptional job of providing burial options for the 
nearly 91 percent, about 170,000, of veterans who fall within a 75-mile 
radius threshold model. However, the NCA realized that, without 
adjusting this model, only one area, St. Louis, would qualify for a 
cemetery within the next five years and that the five highest veteran 
population concentrated areas of the country would never qualify if the 
threshold remained unchanged.
    In 2010, the IBVSOs recommended several new threshold models for 
NCA to consider in an effort to best serve a veterans population 
declining in number. The IBVSOs are pleased to see that NCA has 
adjusted its model and will begin factoring in 80,000 veterans within a 
75-mile radius for future cemetery placement. This modification will 
allow NCA to continue to provide burial options for veterans who would 
otherwise be limited geographically for this benefit.
            national cemetery administration (nca) accounts
    The Independent Budget recommends an operations budget of $275 
million for NCA for fiscal year 2012 so it can meet the increasing 
demands of interments, gravesite maintenance and related essential 
elements of cemetery operations.
    NCA is responsible for five primary missions: (1) to inter, upon 
request, the remains of eligible veterans and family members and to 
permanently maintain gravesites; (2) to mark graves of eligible persons 
in national, state, or private cemeteries upon appropriate application; 
(3) to administer the state grant program in the establishment, 
expansion, or improvement of state veterans cemeteries; (4) to award a 
Presidential certificate and furnish a United States flag to deceased 
veterans; and (5) to maintain national cemeteries as national shrines 
sacred to the honor and memory of those interred or memorialized.
    However, the national cemetery system continues to face serious 
challenges. Though there has been significant progress made over recent 
years, NCA is still struggling to remove decades of blemishes and scars 
from military burial grounds across the country. Visitors to national 
cemeteries are still likely to encounter sunken graves, misaligned and 
dirty grave markers, deteriorating roads, spotty turf and other patches 
of decay that have been accumulating for decades. If NCA is to continue 
its commitment to ensure national cemeteries remain dignified and 
respectful settings that honor deceased veterans and give evidence of 
the Nation's gratitude for their military service, there must be a 
comprehensive effort to greatly improve the condition, function, and 
appearance of all our national cemeteries.
    NCA has worked tirelessly to improve the appearance of our national 
cemeteries, investing $45 million in the National Shrine Initiative in 
FY 2010 and approximately $25 million per year for the three previous 
years. NCA has done an outstanding job thus far in improving the 
appearance of our national cemeteries, but we have a long way to go to 
get us where we need to be. In 2006 only 67 percent of headstones and 
markers in national cemeteries were at the proper height and alignment. 
By 2009 proper height and alignment increased to 76 percent. NCA is on 
target to reach 82 percent this fiscal year. To ensure that NCA has the 
resources to reach its strategic goal of 90 percent, the IBVSOs 
recommend that NCA's operations and maintenance budget be increased by 
$20 million per year until the operational standards and measures goals 
are reached.
    In addition to the management of national cemeteries, NCA is 
responsible for the Memorial Program Service. The Memorial Program 
Service provides lasting memorials for the graves of eligible veterans 
and honors their service through Presidential Memorial Certificates. 
Public Laws 107-103 and 107-330 allow for a headstone or marker for the 
graves of veterans buried in private cemeteries who died on or after 
September 11, 2001. Prior to this change, NCA could provide this 
service only to those buried in national or state cemeteries or to 
unmarked graves in private cemeteries. Public Law 110-157 gives VA 
authority to provide a medallion to be attached to the headstone or 
marker of veterans who are buried in a private cemetery. This benefit 
is available to veterans in lieu of a government-furnished headstone or 
marker.
                   the state cemetery grants program
    The State Cemeteries Grant Program (SCGP) faces the challenge of 
meeting a growing interest from states to provide burial services in 
areas that are not currently served. The intent of the SCGP is to 
develop a true compliment to, not a replacement for, our Federal system 
of national cemeteries. With the enactment of the Veterans Benefits 
Improvements Act of 1998, the NCA has been able to strengthen its 
partnership with states and increase burial service to veterans, 
especially those living in less densely populated areas not currently 
served by a national cemetery. Currently there are 48 state and tribal 
government matching grants for cemetery projects.
    The Independent Budget recommends Congress appropriate $51 million 
for SCGP for FY 2012. This funding level would allow SCGP to establish 
new state cemeteries at their current rate that will provide burial 
options for veterans who live in regions that currently has no 
reasonably accessible state or national cemeteries.
                            burial benefits
    Burial allowance was first introduced in 1917 to prevent veterans 
from being buried in potter's fields. In 1923 the allowance was 
modified. The benefit was determined by a means test, and then in 1936 
the means test was removed. In its early history the burial allowance 
was paid to all veterans, regardless of their service connectivity of 
death. In 1973 the allowance was modified to reflect the status of 
service connection. The plot allowance was introduced in 1973 as an 
attempt to provide a plot benefit for veterans who did not have 
reasonable access to a national cemetery.
    In 1973, NCA established a burial allowance that provided partial 
reimbursements for eligible funeral and burial costs. The current 
payment is $2,000 for burial expenses for service-connected (SC) death, 
$300 for non-service-connected (NSC) deaths, and $300 for plot 
allowance. At its inception, the payout covered 72 percent of the 
funeral cost for a service-connected death, 22 percent for a non-
service-connected death, and 54 percent of the burial plot cost. In 
2007 these benefits eroded to 23 percent, 4 percent, and 14 percent 
respectively. It is time to restore the original value of the benefit.
    The IBVSOs are pleased that the last Congress acted to improve the 
benefits, raising the plot allowance to $700 as of October 1, 2011. 
However, there is still a serious deficit in original value of the 
benefit when compared to the current value.
    While the cost of a funeral has increased by nearly 700 percent, 
the burial benefit has only increased by 250 percent. To restore both 
the burial allowance and plot allowance back to their 1973 values, the 
SC benefit payment should be $6,160, the NSC benefit value payment 
should be $1,918, and the plot allowance should increase to $1,150.
    Based on accessibility and the need to provide quality burial 
benefits, The Independent Budget recommends that VA separate burial 
benefits into two categories: veterans who live inside the VA 
accessibility threshold model, and those who live outside the 
threshold. For those veterans who live outside the threshold, the SC 
burial benefit should be increased to $6,160, NSC veteran's burial 
benefit should be increased to $1,918, and plot allowance should 
increase to $1,150 to match the original value of the benefit. For 
veterans who live within reasonable accessibility to a state or 
national cemetery that is able to accommodate burial needs, but the 
veteran would rather be buried in a private cemetery, the burial 
benefit should be adjusted. These veterans' burial benefits will be 
based on the average cost for VA to conduct a funeral. The benefit for 
a SC burial should be $2,793, the amount provided for a NSC burial 
should be $854, and the plot allowance should be $1,150. This will 
provide a burial benefit at equal percentages, but based on the average 
cost for a VA funeral and not on the private funeral cost that will be 
provided for those veterans who do not have access to a state or 
national cemetery.
    In addition to the recommendations we have mentioned, the IBVSOs 
also believe that Congress should enact legislation to adjust these 
burial benefits for inflation annually.
    The IBVSOs call on the Administration and Congress to provide the 
resources required to meet the critical nature of the NCA mission and 
fulfill the Nation's commitment to all veterans who have served their 
country so honorably and faithfully.
    NCA honors veterans with a final resting place that commemorates 
their service to this Nation. More than 3 million servicemembers who 
died in every war and conflict are honored through internment in a VA 
national cemetery. Each Memorial Day and Veterans Day we honor the last 
full measure of devotion they gave for this country. Our national 
cemeteries are more than the final resting place of honor for our 
veterans; they are hallowed ground to those who died in our defense, 
and a memorial to those who survived.
    AMVETS' second focus in the FY 2012 IB is on veteran 
entrepreneurship and Federal procurement as it relates to Service 
Disabled Veteran Owned Small Businesses (SDVOSB) and Veterans Owned 
Small Businesses (VOSB). We believe that both of these issues play a 
vital rule in the success of transitioning servicemembers and the 
quality of life for veterans. And while I do note that a majority of 
the proceeding information is focused on policy rather than hard fiscal 
numbers, we believe that broken policy, duplication of efforts and lack 
of oversight are key factors in determining fiscally responsible 
budgets.
          veteran preference in federal hiring and procurement
    Supporting Service-disabled Veteran-owned Small Businesses 
(SDVOSBs) and Veteran-owned Small Businesses (VOSB) contributes 
significantly in sustaining a veteran's quality of life, while also 
contributing to the success and ease of transitioning from active duty 
to civilian life. Often in these tough economic times, self employment 
and entrepreneurship are the only ways many veterans are able to earn a 
living wage. Given the circumstances, now more than ever, Federal 
agencies must be held accountable to meet the Federal procurement goals 
outlined by Executive Order 13360, Sections 15 (g) and 36 of the Small 
Business Act and the numerous other published Federal regulations 
outlining veterans' preference and SDVOSB set-aside laws.
    The Government Accountability Office's (GAO) most recent review of 
interagency agreements found that VA is still lacking an effective 
process to ensure that interagency agreements include the required 
language instructing all Federal agencies comply with VA's contracting 
goals and preferences for SDVOSBs and VOSBs. While it is noted that VA 
issued guidance to all contracting officers on managing interagency 
acquisitions in March 2009, the numerous interagency agreements still 
did not even include the required language addressing VA's contracting 
goals and preferences until it was amended on March 19, 2010. This 
serves as an example of how VA is clearly lacking an established 
hierarchy or clear delegation of duties in oversight activities. This 
lack of oversight is continuing to contribute to VA having no assurance 
or metrics in place to conduct proper oversight that agencies have made 
maximum feasible efforts to contract with SDVOSBs or VOSBs. This lack 
of oversight only stands to hurt those in which the laws were 
established to protect, the veterans.
    We recommend stronger oversight, outreach and enforcement by all 
Federal agencies tasked with ensuring the success of our veteran 
entrepreneur community. This includes, but is not limited to, the U.S. 
Department of Labor (DOL), Office of Small Business Programs (OSBP), 
Small Business Administration (SBA), Office of Federal Contract 
Compliance and Procurement (OFCCP) and all other Federal agencies 
committing to reaching their 3 percent goal. All Federal agencies must 
make a high priority of assisting in the development and implementation 
of stronger strategies and accountability in reaching the three-percent 
goal of veteran employment and contracting.
    Congress must ensure adequate resources are available to 
effectively monitor and recognize those agencies that are not meeting 
the three-percent goal and hold them accountable for failure. The 
annual reports filed by all Federal agencies, reporting the prior 
fiscal years' actual percentage of goal achieved, should serve as 
guidance as to which agencies need the most assistance in the 
development and implementation of stronger contracting plans and 
oversight.
                     center for veteran enterprise
    Another critical aspect in ensuring the success of our veteran 
entrepreneur community is promoting and assisting veterans in their 
entrepreneurial endeavors through programs such as the Center for 
Veteran Enterprise (CVE). CVE was established to assist all veterans 
with the numerous aspects of establishing and maintaining a small 
business. CVE is a subdivision of the Office of Small and Disadvantaged 
Business Utilization that extends entrepreneur services to veterans 
whom own or who want to start a small business. CVE is also tasked with 
aiding other Federal contracting offices in identifying VOSBs in 
response to Executive Order 133600. In the past, VA has faced many 
obstacles, from lack of leadership to best practices with their 
entrepreneurship programs, which have directly resulted in and 
prevented the success of veteran owned businesses. For this reason, VA 
established the program entitled the Center for Veterans Enterprise 
(CVE) with the passage of the Veterans Entrepreneurship and Small 
Business Development Act of 1999. Furthermore, on Dec. 22, 2006, 
President Bush signed Public Law 109-461, the Veterans Benefits, Health 
Care, and Information Technology Act of 2006 in an effort to 
successfully identify and grant status to SDVOSBs. Effective June 20, 
2007, 
this legislation authorized a unique ``Veterans First'' approach, 
specific to VA contracting.
    As we move through the 21st century, during a time of war on 
multiple fronts, the VOSB and SDVOSB population continues to rise at a 
rate not seen since the end of World War II. As America's war-fighters 
transition back into civilian life, many are choosing to pursue lives 
as entrepreneurs. Given the almost 35 percent influx of VOSB and 
SDVOSB, it is vital that the Center for Veterans Enterprise be ready 
and able to meet the growing demand for their services. However, the 
IBVSOs do not believe that CVE is serving the needs of those veterans 
it was originally designed to help. Due to a lack of leadership over 
the past year, we have seen CVE slowly move from the role of assisting 
VOSB and SDVOSBs to that of an information and referral agency for 
other Federal and state agencies. We believe the Center for Veteran 
Enterprise must be brought back up to par with what it was originally 
tasked to do: assisting our veteran population in all aspects for their 
entrepreneurship endeavors. In order to effectively accomplish this 
Congress must provide dedicated funding and strong oversight in 
ensuring CVE is properly staffed, trained and funded.
                      vendor verification systems
    Another key part of protecting our veterans in a successful Federal 
procurement system is through a centralized vendor verification system. 
We believe it to be vital for all Federal agencies to utilize a 
continually updated, single centralized source database in the 
verification of all businesses claiming preferred status as a VOSB or 
SDVOSB.
    At present, vendors desiring to do business with the Federal 
Government must register in the Central Contractor Registration (CCR) 
database, and those who indicate they are veterans or service-disabled 
veterans, self-certify their status without verification. Public Law 
109-461 required VA to establish a Vendor Information Page (VIP) 
database to accurately identify businesses that are 51 percent or more 
owned by veterans or service-disabled veterans. This database was 
originally designed to act as a reliable, centralized database enabling 
all Federal agencies a single source in the identification of possible 
SDVOSB and VOSB for consideration during their procurement processes. 
Furthermore, both contractors and subcontractors involved in the 
procurement process of any government award is then required to provide 
the Secretary of Labor a specific breakdown of all information required 
by the VETS 100 and VETS 100-A filed on an annual basis, demonstrating 
their continued compliance with the contracts terms regarding veterans 
preference and status. As of April 15, 2009, approximately 18,000 
SDVOSBs were registered in the Central Contractor Registration, 
however, due to lack of oversight and an inconsistent, self-reported 
status verification processes, many non-veteran-owned businesses are 
not receiving the protections they are entitled to under the law.
    On February 8, 2010, the final CFR rules regarding ``VA Veteran-
Owned Small Business Verification Guidelines'' were published. The 
document affirms as final, with changes, an interim final rule that 
implements portions of the Veterans Benefits, Health Care, and 
Information Technology Act of 2006. This law requires the Department of 
Veterans Affairs (VA) to verify ownership and control of veteran-owned 
small businesses, including service-disabled veteran-owned small 
businesses. This final rule declares to define the eligibility 
requirements for businesses to obtain verified status, explains 
examination procedures and establishes records retention and review 
processes. However, the newly published rule fails to outline any solid 
changes or improvements to the SDVOSB verification process. We further 
believe the newly published rules on the verification process focused 
on control and ownership definitions, yet provided no clarification on 
the specifics of the verification process. The IBVSOs believe these 
updates to 38 CFR, Part 74 regarding Public Law 109-461 still leave the 
integrity of the SDVOSB and VOSB verification system open to fraud. 
This continued lack of clarity and non-uniformed inconsistent status 
verification processes will cause the same unwanted results of many 
veteran owned businesses not receiving the protections they are 
entitled to under the law.
    VA has thus far been awarded $1.4 billion in recovery act funds to 
aide in the employment and contracting opportunities available to 
SDVOSB and VOSB. To date $538 million has been used on awards to SDVOSB 
and VOSB, according to VA. However, we have very serious concerns on 
how much of these appropriated funds were actually awarded to 
legitimate SDVOSB and VOSBs, due to the lack of verification processes 
in place at VA.
    In an effort to resolve this issue we recommend that all Federal 
agencies should be required to certify veteran status and ownership 
through the VA's VIP program before awarding contracts to companies 
claiming veteran status. We also recommend the database be maintained 
and updated on a regular basis to avoid backlogs of vendors waiting to 
be certified or re-certified.
    Furthermore, Congress must take the necessary actions in requiring 
all Federal agencies to use a single source database in all 
verifications of veteran ownership statuses before unknowingly awarding 
contracts to companies on the basis of claiming SDVOSB or VOSB 
preference. Finally, internal promotion and education on proper usage 
of the database should coincide with implementation of databases use.
                           veteran set-asides
    Protecting veteran set-asides within the Federal procurement system 
is a matter that must be addressed more rigorously within VA's training 
and personnel programs. Public Law 109-461, the ``Veterans Benefits, 
Health Care and Information Technology Act of 2006,'' was signed Dec. 
22, 2006, and went into effect on June 20, 2007. The law allows VA 
special authority to provide set-aside and sole-source contracts to 
small businesses owned and operated by veterans and service-disabled 
veterans. This legislation is codified in Title 38, United States Code, 
sections 8127 and 8128. After more than three years since its 
enactment, no significant change has been implemented with regard to 
how Federal contracting officers are trained. VA personnel involved in 
the acquisition process need to be trained and familiarized with all 
current and new authorizations and responsibilities under P. L. 109-
461, as well as all other procurement directives regarding VOSBs and 
SDVOSBs. Our service-disabled veterans who own small businesses cannot 
afford to wait any longer for VA to enforce compliance with the law.
    Under current policy, no proof of compliance is required, nor do 
random labor audits occur. OIG has issued more than 10 reports 
illustrating these deficiencies in recent years. Most recently, in 
October 2009 the U.S. Government Accountability Office (GAO) issued 
their report on ``Service-Disabled Veteran-Owned Small Business 
Program: Case Studies Show Fraud and Abuse Allowed Ineligible Firms to 
Obtain Millions of Dollars in Contracts'' to the Committee on Small 
Business. This report outlines how millions of dollars in set-aside 
contracts were awarded to non-SDVOSB businesses due to the gross lack 
of program controls in place to detect and prevent fraud. The report 
identified 10 case-study examples of firms that did not meet the basic 
SDVOSB program eligibility requirements, but yet received over $100 
million in SDVOSB set-aside contracts. VA, DOL, SBA and the OFCCP must 
exercise better oversight and stronger enforcement with consequences 
for any government agency or nongovernment business claiming to be 
awarding set-asides to veteran-owned businesses when, indeed, they are 
not. There needs to be an immediate focus on proactive measures to 
eliminate untruths, such as ``rent a vet,'' and cease only exercising 
``reactive'' strategies. VA, the DOL, SBA, and OFCCP should pool all 
their resources and successful strategies to ensure swift action and to 
avoid duplication of efforts.
    Furthermore, we believe VA must develop and implement uniformed 
training processes for all staff involved with the Federal procurement 
process, especially contracting officers. VA must also provide systems 
and metrics to identify the strengths and weaknesses in its procurement 
processes, as well as continued training and evaluations of contracting 
staff in efforts of successfully identifying weaknesses and strengths 
within the program as a whole.
    Last, VA, DOL, SBA, OFCCP and the Employment and Training 
Administration must collaborate in developing and implementing a 
single-source database for employer outreach programs for the promotion 
of veterans' entrepreneurship at local and national levels. This system 
must allow all employers to locate veterans for employment as well as 
provide an updated listing of employment opportunities.

    Again, Chairman Murray, ranking Member Burr and Members of the 
Committee, we thank you for inviting us to share with you our 
recommendations and stand ready to answer any questions you may have.

    Chairman Murray. Thank you very much.
    Mr. Kelley.

STATEMENT OF RAYMOND C. KELLEY, DIRECTOR, NATIONAL LEGISLATIVE 
     SERVICE, VETERANS OF FOREIGN WARS OF THE UNITED STATES

    Mr. Kelley. Madam Chairman, on behalf of the 2.1 million 
members of the Veterans of Foreign Wars and its auxiliary, 
congratulations on your appointment to the chairmanship and 
thank you for the opportunity to testify today.
    As a partner of The Independent Budget, the VFW is 
responsible for the construction budget. So I am going to limit 
my remarks to that subject today.
    A vast, growing, and aging infrastructure continues to 
create a burden on VA's overall construction and maintenance 
requirements. These facilities are the instruments that are 
used to deliver the care to our injured male veterans.
    Every effort must be made to ensure that these facilities 
are safe and sufficient environments to deliver that care. A VA 
budget that does not adequately fund facility maintenance and 
construction will reduce the timeliness and quality of care to 
our veterans.
    This is why the IB partners are recommending an overall 
construction budget of $2.8 billion, $2.2 billion for the major 
construction accounts, and $585 million for the minor 
construction accounts.
    Last fall, the VA provided the IB partners with an overview 
of the new strategic capital investment plan, or SCIP. After 
the briefing and upon reviewing VA's Fiscal Year 2012 Budget 
submission, the IB partners were pleased with the improved 
transparency of the capital planning.
    VA has advised the IB partners that SCIP is intended to 
identify capital acquisition needs ranging from nonrecurring 
maintenance and leasing to major and minor construction 
projects, and to close the currently identified performance 
gaps.
    All told, these gaps will require between $53 and $65 
billion in funding over the next 10 year. However, at the 
Administration's requested level, it will take between 18 and 
22 years to achieve this 10-year Plan.
    Underfunding VA's capital plan in its infancy will only 
exacerbate the ongoing construction and maintenance needs. We 
are happy to see that the VA's Fiscal Year 2012 Budget request 
for medical facilities in New Orleans, Denver, and along with 
three other major construction sites will be fully funded. 
However, only seven of the 23 partially-funded major 
construction projects will continue to be funded in fiscal year 
2012, leaving well over $4 billion remaining in partially-
funded projects dating back to fiscal year 2007.
    These projects include: improving seismic deficiencies; 
providing spinal cord injury centers; completing a polytrauma 
blind rehab and research facility; as well as expanding mental 
health facilities. These projects have a purpose and should be 
funded as quickly as possible to fulfill the promise of care to 
our wounded and ill veterans.
    The VA is requesting approximately $545 million to continue 
construction on seven existing projects and to begin work on 
four new projects. At this pace, VA will not reach its 
strategic capital investment 10-year plan.
    Therefore, the IB partners request Congress provide funding 
of $1.85 billion for VHA major construction accounts. This will 
allow VA to complete all current partially-funded major 
construction projects within 5 years, begin providing funding 
for 15 new projects and fund the four currently partially-
funded seismic correction projects at a level that will have 
them completed in 3 years.
    The IB partners are pleased with VA's funding requests for 
VHA minor construction accounts. This level of funding will 
allow VA to fully fund more than 75 projects.
    The Administration's requests for NCA construction projects 
totals nearly $80 million. The IB is requesting $161 million. 
This will allow NCA to complete nearly all of its minor 
construction projects and begin three major projects, expanding 
veterans' access to cemeteries in Hawaii, Florida, and 
Colorado.
    The IB partners are also requesting an increase in funding 
for research facilities, funding at the level of $150 million 
will allow work to begin on the five highest priority research 
projects.
    Again, it is critical to the care of our veterans that we 
fully fund VA construction.
    Madam Chairwoman, I thank you again for this opportunity 
and look forward to any questions you or the Committee may 
have.
    [The prepared statement of Mr. Kelley follows:]
Prepared Statement of Raymond C. Kelley, Director, National Legislative 
         Service, Veterans of Foreign Wars of The United States
    Madam Chairwoman and Members of the Committee: On behalf of the 2.1 
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. The VFW works alongside the other members of the 
Independent Budget (IB)--AMVETS, Disabled American Veterans and 
Paralyzed Veterans of America--to produce a set of policy and budget 
recommendations that reflect what we believe would meet the needs of 
America's veterans. The VFW is responsible for the construction portion 
of the IB, so I will limit my remarks to that portion of the budget.
    The Department of Veterans Affairs (VA) manages a wide portfolio of 
capital assets throughout the nationwide system of health-care 
facilities. According to the latest VA Capital Asset Plan, VA owns 
5,405 buildings and almost 33,000 acres of land. It is a vast network 
of facilities that requires much time and attention from VA's capital 
asset managers. Unfortunately, VA's infrastructure is aging rapidly. 
Although Congress has funded a significant number of new facilities in 
recent years, the vast majority of existing VA medical centers and 
other associated buildings are on average more than 60 years old.
    Aging facilities create an increased burden on VA's overall 
maintenance requirements. They must be maintained aggressively so that 
their building systems--electrical, plumbing, capital equipment, etc.--
are up to date and that these facilities are able to continue to 
deliver health care in a clean and safe environment. Older, out-of-date 
facilities do not just present patient safety issues: from VA's 
perspective, older buildings often have inefficient layouts and 
inefficient use of space and energy. This means that even with 
modification or renovation, VA's operational costs can be higher than 
they would be in a more modern structure.
    VA has begun a patient-centered reformation and transformation of 
the way it delivers care and new ways of managing its infrastructure 
plan based on the needs of sick and disabled veterans in the 21st 
century. Regardless of what the VA health-care system of the future may 
look like, our focus must remain on ensuring a lasting, accessible, 
modernized system that is dedicated to the unique needs of veterans 
while also providing unparalleled and timely care when and where 
veterans need it.
    The Capital Asset Realignment for Enhanced Services (CARES) 
process, VA's data-driven assessment of current and future construction 
needs, gave VA a long-term roadmap and has helped guide its capital 
planning process over the past 10 years. The CARES process developed a 
large number of significant construction objectives that would be 
necessary for VA to fulfill its obligation to sick and disabled 
veterans. Over the past several years, the Administration and Congress 
have made significant inroads in funding these priorities. Since fiscal 
year (FY) 2004, $5.9 billion has been allocated for these projects.
    The Independent Budget veterans service organizations believe that 
CARES was a necessary undertaking and that VA has made slow but steady 
progress on many of these critical projects. In the post-CARES era, 
many essential construction projects are still awaiting authorization 
and funding, and the IBVSOs firmly believe that Congress cannot allow 
the construction needs that led to the CARES blueprint to be 
disregarded. Both strong oversight and sufficient funding are critical 
in this ongoing task of maintaining the best care for veterans.
    Given the challenges presented by the CARES blueprint, including a 
backlog of partially funded construction projects, high costs of 
individual projects, and our concern about the timeliness of these 
projects--noting that it can take the better part of a decade from the 
time VA initially proposes a project until the doors actually open for 
veterans' care--VA has proposed a new program, named ``Strategic 
Capital Investment Planning'' (SCIP). This initiative will address some 
of the infrastructure issues that have been noted in The Independent 
Budget.
    SCIP is VA's newest approach to reevaluating its aging and 
underutilized infrastructure, as well as examining the lack of 
infrastructure in various locations around the country. The intent of 
SCIP, according to VA, is to scrutinize all property so that VA can 
best address gaps in delivery of care and services to veterans. Unlike 
CARES, SCIP will cover all of VA, not only Veterans Health 
Administration facilities; however, similar to CARES, SCIP is designed 
to evaluate the condition of VA infrastructure, in order to build a 10-
year integrated capital plan. The goal is to improve quality of and 
access to VA services by modernizing facilities based on current and 
future needs. If SCIP is approved as VA's capital planning method, the 
Department plans to begin this process with the FY 2012 budget cycle.
    VA has also advised the IBVSOs that SCIP is intended to address the 
funding shortfall of $24.3 billion to deal with major construction and 
facility condition assessment backlogs, inefficient use of resources, 
and high maintenance costs, as well as an existing commitment of about 
$4.4 billion to complete ongoing major construction projects. If 
approved, the goal of this new initiative must be a comprehensive plan 
that will improve quality by providing equitable access to services for 
all veterans across the VA system of care and services. As the age of 
VA structures increase, costs go up, often dramatically so. 
Accordingly, more funding is spent on older projects, leaving less for 
other maintenance and construction needs and increasing the overall 
budget for both major and minor construction. VA must adopt a plan for 
the future that will review and assess all current and future needs 
while providing priorities and transparency at the forefront.
    A draft of the SCIP proposal was most recently provided to the 
IBVSOs in October 2010. The overview included a future-oriented view of 
VA capital needs beginning with the 2012 budget. According to VA, SCIP 
would adapt to changes in environment, provide a comprehensive planning 
process for all projects, and result in one prioritized listing of 
capital projects VA wide. The list intends to ensure equitable access 
to services for veterans across the country and includes major and 
minor construction, nonrecurring maintenance, and leasing.
    Because SCIP is a new initiative, The Independent Budget veterans 
service organizations encourage VA to be transparent during the process 
and would advise that challenges must be met when reviewing all current 
and future needs of its aging infrastructure. The goal must be a 
comprehensive plan that will improve quality by maintaining equitable 
access to services across the VA system. The changing health-care 
delivery needs of veterans, including reduced demand for inpatient beds 
and increasing demand for outpatient care and medical specialty 
services, along with limited funding available for construction of new 
facilities, has created a growing backlog of projects that are becoming 
more expensive to complete. VA has advised that SCIP is intended to 
address the funding shortfalls of its current capital backlog needs.
                 major and minor construction accounts
    The Department of Veterans Affairs continues to be faced with 
challenges with respect to the maintenance backlog. VA regularly 
surveys each facility as part of the Facilities Condition Assessment 
(FCA) process. VA estimates the cost of repair and uses this cost 
estimate as a component of its Federal Real Property Report 
requirements. According to its latest Five-Year Capital Plan, VA has 
estimated the total cost of repairing all ``D-rated'' and ``F-rated'' 
FCA deficiencies at a cost of $8 billion, even as it and Congress have 
greatly increased the amount of funding and resources devoted to this 
critical aspect of capital asset management. Although Congress has 
increased recent funding for nonrecurring maintenance (NRM), these 
funding levels only touch the surface of the backlog.
    For years, NRM and other maintenance needs were significantly 
underfunded, and massive backlogs ensued (see ``Increased Spending on 
Nonrecurring Maintenance'' in this Independent Budget). Maintenance is 
only a small fraction of the major infrastructure issues confronting 
the system. The Independent Budget veterans service organizations 
(IBVSOs) are also concerned about the huge backlog of major medical 
construction projects and the political and economic reality that fully 
funding each of these projects and constructing them in a timely manner 
may not be feasible.
    One of the reasons for such a large backlog of construction 
projects is because Congress allocated so little funding during the 
Capital Asset Realignment for Enhanced Services (CARES) process. The 
Appropriations Committees provided few resources during the initial 
review phase, and against our advice, preferred to wait for the result 
of CARES. Because of our convictions that a number of these projects 
needed to go forward and that they would be fully justified through any 
plans developed by CARES, the IBVSOs argued that a de facto moratorium 
on construction was unnecessary and would be harmful. The House agreed 
with our views as evidenced by its passage of the Veterans Hospital 
Emergency Repair Act, March 27, 2001; however, Congress never 
appropriated funding to carry out the purposes of that act, and the 
construction and maintenance backlogs continued to grow.
    Upon completion of the CARES decision document in 2004, former VA 
Secretary Anthony Principi testified before the Health Subcommittee of 
the House Committee on Veterans' Affairs. He noted that CARES 
``reflects a need for additional investment of approximately $1 billion 
per year for the next five years to modernize VA's medical 
infrastructure and enhance veterans' access to care.'' In a 
November 17, 2008, letter to the Senate Committee on Veterans' Affairs, 
then-Secretary James Peake reported that VA would need at least $6.5 
billion over the following five years to meet its funding requirements 
for major medical facility construction projects.
    As noted previously, VA has proposed a new program, Strategic 
Capital Investment Planning (SCIP), to address some of the construction 
and infrastructure issues presented in The Independent Budget. Given 
the President's pledge to create a VA for the 21st century, the IBVSOs 
expect the Department to proceed with its SCIP plan in a transparent 
way, coordinate the plan through our community and other interested 
parties, and provide its plan to Congress for review and approval if 
required. However, until SCIP is fully implemented, we fear that VA's 
capital programs and the significant effects on the system as a whole 
and veterans individually will go unchanged; ultimately risking a 
diminution of care and services provided by VA to sick and disabled 
veterans in substandard facilities.
    Until the SCIP plan is approved and in place across the VA network 
of care, the IBVSOs will continue to argue for sufficient funding needs 
to maintain VA's capital infrastructure and to ensure a safe and useful 
system for all veterans who need VA health care. With this in mind, the 
IBVSOs would like to outline the components of our Major and Minor 
Construction account requests of this Independent Budget.

                           Major Construction
------------------------------------------------------------------------
                                                          Recommendation
                        Category                               ($ in
                                                            thousands)
------------------------------------------------------------------------
Major Medical Facility Construction.....................      $1,850,000
NCA Construction........................................        $ 61,000
Advance Planning........................................         $45,000
Master Planning.........................................         $15,000
Historic Preservation...................................         $20,000
Medical Research Infrastructure.........................        $150,000
Miscellaneous Accounts..................................        $ 60,000
                                                         ---------------
  TOTAL.................................................      $2,201,000
------------------------------------------------------------------------



                           Minor Construction
------------------------------------------------------------------------
                                                           Funding ($ in
                        Category                            thousands)
------------------------------------------------------------------------
Veterans Health Administration..........................        $450,000
National Cemetery Administration........................        $100,000
Veterans Benefits Administration........................         $20,000
Staff Offices...........................................         $15,000
                                                         ---------------
  TOTAL.................................................        $585,000
------------------------------------------------------------------------

    Major Medical Facility Construction--This amount would allow VA to 
continue to address the backlog of partially funded construction 
projects which includes any ongoing major construction projects already 
approved. Depending on the stage in the process and VA's ability to 
complete portions of the projects within the fiscal year, remaining 
funds could be used for projects identified by VA as part of SCIP.
    National Cemetery Administration--This amount would fund a number 
of national cemeteries from VA's priority list as well as potential 
projects identified by SCIP.
    Advanced Planning--This amount helps develop the scope of the Major 
Medical Facility construction project as well as to identify proper 
requirements for their construction. It allows VA to conduct necessary 
studies and research similar to the planning process in the private 
sector.
    Master Planning--A description of The Independent Budget request 
follows later in the text.
    Historic Preservation--A description of The Independent Budget 
request follows later in the text.
    Miscellaneous Accounts--These included the individual line items 
for such accounts as asbestos abatement, the judgment fund, and 
hazardous waste disposal.
    Minor Construction Account--SCIP has already identified minor 
construction projects that update and modernize VA's aging physical 
plant, ensuring the health and safety of veterans and VA employees.
    Medical Research Infrastructure--Funding needs to be allocated by 
Congress to allow for needed renovations to VA research facilities.
    Medical Research Infrastructure--A description of The Independent 
Budget request follows later in the text.
    National Cemetery Administration--This includes minor construction 
projects identified by SCIP to include the construction of several 
columbaria, installation of crypts, and landscaping and maintenance 
improvements.
    Veterans Benefits Administration--This includes several minor 
construction projects identified by SCIP in addition to the leasing 
requirements the Veterans Benefits Administration needs. It also 
includes $2 million transferred yearly for the security requirements of 
its Manila office.
    Staff Offices--This includes minor construction projects related to 
staff offices, including increased space and numerous renovations for 
the VA Office of Inspector General.
    We view these issues as the critical areas that must be addressed 
when developing our funding recommendations. We would also like to note 
that within many of these categories lies ongoing and unfunded projects 
as well as backlogged facility repairs and maintenance.
         inadequate funding and declining capital asset value:
The Department of Veterans Affairs must protect against deterioration 
        of its infrastructure and a declining capital asset value.
    Good stewardship demands that VA facility assets be protected 
against deterioration and that an appropriate level of building 
services be maintained. Given VA's construction needs, such as seismic 
correction, compliance with the Americans with Disabilities Act (ADA) 
and Joint Commission on Accreditation of Healthcare Organization 
(JCAHO) standards, replacing aging physical plant equipment, and 
projects that were identified by the Capital Asset Realignment for 
Enhanced Services (CARES) initiative, the VA construction budget 
continues to be inadequate. During the past decade of underfunded 
construction budgets, VA has not adequately recapitalized its 
facilities.
    Recapitalization is necessary to protect the value of VA's capital 
assets through the renewal of the physical infrastructure. This ensures 
safe and fully functional facilities long into the future.
    VA facilities have an average age of more than 60 years, and it is 
essential that funding be increased to renovate, repair, and replace 
these aging structures and physical systems. In the past, The 
Independent Budget veterans service organizations (IBVSOs) have cited 
the recommendations of the final Report of the President's Task Force 
to Improve Health Care Delivery for Our Nations Veterans (PTF). To 
underscore the importance of this issue, we again cite the 
recommendations of the PTF. It was noted that VA health-care facility 
major and minor construction over the 1996 to 2001 period averaged only 
$246 million annually, a recapitalization rate of 0.64 percent of the 
$38.3 billion total plant replacement value. At this rate of 
investment, VA would be recapitalizing its infrastructure every 155 
years.
    If maintenance and restoration were considered along with major 
construction, VA invests less than 2 percent of plant replacement value 
for its entire facility infrastructure nationwide. A minimum of 5 
percent to 8 percent investment of plant replacement value is necessary 
to maintain health-care infrastructure. If this rate is not improved, 
veterans could be receiving care in potentially more unsafe and 
dysfunctional settings as time goes along. Improvements in the delivery 
of health care to veterans require that VA adequately create, sustain, 
and renew physical infrastructure to ensure safe and functional 
facilities. The FY 2008 VA Asset Management Plan provided the most 
recent estimate of plant replacement value (PRV). Using the guidance of 
the Federal Government's Federal Real Property Council, VA's PRV is 
more than $85 billion. The IBVSOs appreciate the Administration's 
efforts to increase the total capital budget, and we hope future 
requests will be more in line with the system's needs.
Recommendations:
    Congress and the Administration must ensure that adequate funds are 
appropriated for VA's capital needs so that it can properly invest in 
its physical assets to protect their value and to ensure that it can 
continue to provide health care in safe and functional facilities long 
into the future.
            increased spending on nonrecurring maintenance:
The deterioration of many VA properties requires increased spending on 
        nonrecurring maintenance.
    For years The Independent Budget veterans service organizations 
(IBVSOs) have stressed the importance of providing necessary funding 
for nonrecurring maintenance (NRM) accounts to ensure that longstanding 
and continual upkeep requirements at VA facilities are met. NRM 
embodies the many small projects that together provide for the long-
term sustainability and usability of VA facilities. NRM projects are 
onetime repairs, such as modernizing mechanical or electrical systems, 
replacing windows and equipment, and preserving roofs and floors, among 
other routine maintenance needs. Nonrecurring maintenance is a 
necessary component of the care and stewardship of a facility. When 
managed responsibly, these relatively small, periodic investments 
ensure that the more substantial investments of major and minor 
construction provide real value to taxpayers and to veterans as well.
    When NRM projects are ignored, the results can be detrimental to 
the value of a VA property and the quality of care they facilitate for 
veterans. Nonrecurring maintenance projects that are left undone 
inevitably require more costly and time-consuming repairs when they are 
eventually addressed. Furthermore, this lack of attention to basic 
structural maintenance issues jeopardizes the safety of staff and 
patients. Because delayed maintenance projects always require a more 
invasive response as opposed to situations in which NRM is responsibly 
managed, the IBVSOs believe neglecting such projects is tantamount to 
denying veterans timely and professional care and even placing them in 
danger.
    Accordingly, to fully maintain its facilities, VA needs an NRM 
annual budget of at least $1.7 billion. Teams of professional engineers 
and cost estimators survey each medical facility at least once every 
three years as part of VA's Facilities Condition Assessment (FCA) 
process. These surveys assess all components of a given facility to 
include internal issues, such as plumbing, and external issues, such as 
parking and mobility barriers. Each component of a facility is given a 
letter grade, A through F. Areas given a grade of F no longer function 
or are in danger of imminent structural or system failure. VA estimates 
the cost of repair for each item that is rated D or F and then uses 
this cost estimate as a component of its Federal Real Property Report 
requirements. VA's latest Five-Year Capital Plan estimated the total 
cost of repairing all D-rated and F-rated FCA deficiencies at a 
staggering $8 billion, even as VA and Congress have greatly increased 
the amount of funding and resources devoted to this critical aspect of 
capital asset management. Since that time, NRM received a one-time 
allocation of $1 billion through Public Law 111-5, the ``American 
Recovery and Reinvestment Act.''
    VA uses the FCA reports as part of its Federal Real Property 
Council metrics. The department calculates a Facility Condition Index 
(FCI), which is the ratio of the cost of FCA repairs compared to the 
cost of replacement. According to the FY 2008 Asset Management Plan, 
this metric has declined from 82 percent in 2006 to 68 percent in 2008. 
VA's strategic goal is 87 percent, and for the Department to meet that 
goal, it would require a sizable investment in NRM and minor 
construction. Given the low level of funding NRM accounts have 
historically received, the IBVSOs are not surprised that basic facility 
maintenance remains a challenge for VA.
    In addition, the IBVSOs have long-standing concerns with how this 
funding is apportioned once received by VA. Because NRM accounts are 
organized under the Medical Facilities appropriation, it has 
traditionally been apportioned using the Veterans Equitable Resource 
Allocation (VERA) formula. This formula was intended to allocate 
health-care dollars to those areas with the greatest demand for health 
care, and is not an ideal method to allocate NRM funds. When dealing 
with maintenance needs, this formula may prove counterproductive by 
moving funds away from older medical centers and reallocating the funds 
to newer facilities where patient demand is greater, even if the 
maintenance needs are not as intense. We are encouraged by actions the 
House and Senate Veterans' Affairs Committees have taken in recent 
years requiring NRM funding to be allocated outside the VERA formula, 
and we hope this practice will continue.
    Another issue related to apportionment of funding and the budget 
cycle has been well documented. Prior to the passage of advance 
appropriations, the Government Accountability Office (GAO) had found 
that the bulk of NRM funding was not apportioned until September, the 
final month of the fiscal year. For example, the GAO reported that 60 
percent of total NRM funding for FY 2006 was allocated in September of 
that year.
    In other words, during the first 11 month of FY 2006, only 40 
percent of NRM funding had been allocated even as VA knew any 
unobligated funds would be remitted to the Department of the Treasury 
by statute. This is a shortsighted policy that impairs VA's ability to 
properly address its maintenance needs, and with NRM funding year to 
year, those conditions, which lead to a functional mishandling of 
essential funds, have been changed by advance appropriations. Medical 
accounts are now appropriated by Congress a year in advance to allow VA 
the ability to plan farther in advance and reduce the impact of delayed 
appropriations.
    Not receiving timely appropriations from Congress has curtailed the 
positive impacts of medical spending over the years, and Congress must 
now provide oversight of this process to ensure that these upfront 
dollars for NRM and all medical spending realize their potential 
benefits. Congress and VA should provide oversight to ensure this 
change will not result in medical center managers continuing to sit on 
unspent funds for longer periods of time, but that it will produce more 
efficient spending and better planning, thereby eliminating the 
previous situation in which these managers sometimes spent a large 
portion of their maintenance funding very late in the fiscal year.
Recommendations:
    VA must dramatically increase funding for nonrecurring maintenance 
(NRM) in line with the industry standard of 2 percent to 4 percent of 
plant replacement value in order to maintain modern, safe, and 
efficient facilities. Congress should provide VA with additional 
maintenance funding in the Medical Facilities appropriation to enable 
the Department to begin addressing the substantial maintenance backlog 
of Facilities Condition Assessment--identified projects.
    Congress should provide NRM funding to support maintenance and 
upgrades to VA's research infrastructure. Portions of the NRM account 
should continue to be funded outside of the Veterans Equitable Resource 
Allocation formula so that funding is allocated to the facilities that 
have the greatest maintenance needs, rather than based on other 
criteria unrelated to the condition of facilities. Congress must 
provide oversight of the NRM funding allocated through the advance 
appropriations process to ensure NRM funds are being spent in such a 
way to meet their full potential.
              maintain critical va health infrastructure:
The Department of Veterans Affairs must execute a comprehensive, 
        strategic health infrastructure plan that is focused on the 
        unique needs of its veteran population. In order to reduce the 
        growing backlog and maintenance needs of its medical 
        facilities, Congress and the Administration must work together 
        to secure the Department's future by designing the ``VA of the 
        21st century.''
    Today 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 healthcare facility infrastructure. 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. Given these significant challenges and the shift in 
care in many areas, in 2008 VA developed a new approach to dealing with 
infrastructure, the Health Care Center Facility (HCCF) leasing program. 
Under the HCCF leasing program, 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 privately to VA 
specifications. These large clinics could provide a broad range of 
outpatient services, including primary and specialty care as well as 
outpatient mental health services and ambulatory surgery.
    According to VA, inpatient needs at such sites would be managed 
through contracts with affiliates or local private medical centers. The 
Independent Budget veterans service organizations (IBVSOs) believe that 
the adoption of Strategic Capital Investment Planning (SCIP) and more 
HCCF leasing proposals illustrate a shift toward reliance on healthcare 
leasing or a build-to-suit strategy with reliance on community 
providers or academic affiliates for inpatient services, rather than VA 
constructing its own comprehensive medical centers. We remain watchful 
as to how such arrangements will be managed and what unintended 
consequences may await sick and disabled veterans and those who 
represent them.
    Further, SCIP must be clearly explained and integrated with all 
stakeholders involved in the process--specifically, how will it be 
developed and prioritized, and will the implementation of the HCCF 
model impact VA's specialized medical care programs, continuity of 
high-quality care, delivery of comprehensive services, protection of VA 
biomedical research and development programs, and particularly the 
sustainment of VA's renowned graduate medical education and health 
profession training programs? VA noted that, in addition to any new 
HCCF facilities, it would maintain its VA medical centers, larger 
independent outpatient clinics, community-based outpatient clinics 
(CBOCs), and rural outreach clinics.
    VA has argued that adopting the HCCF model would allow it to 
quickly establish new facilities that would provide 95 percent of the 
care and services veterans need in their catchment areas, specifically 
primary care, a variety of specialty care services, mental health, 
diagnostic testing, and same-day ambulatory surgery. Initially, the 
IBVSOs have been supportive of the goals of this program. The HCCF 
model seems to offer a number of benefits in addressing VA 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 
personal convenience.
    This process could also offer the advantage of quick completion as 
compared to the existing major construction design-authorization-
appropriation process, thus allowing more flexibility to respond to 
changes in patient loads and technologies and making possible net 
savings in operating costs and in facility maintenance.
    While it offers these obvious advantages, the HCCF model raises 
concerns about VA's plan for providing inpatient services. VA suggests 
it will contract for these essential services with affiliates or 
community hospitals. The IBVSOs believe this program would privatize 
many services that we believe VA should continue to provide directly to 
veterans. We are also 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; maintenance 
of VA's specialized medical programs for spinal cord injury, blindness, 
amputation care, and other health challenges of seriously disabled 
veterans; delivery of comprehensive services; its recognized biomedical 
research and development programs; and, in particular, the impact on 
its renowned graduate medical education and health profession training 
programs, in conjunction with long-standing affiliations with nearly 
every health professions university in the Nation.
    Moreover, we believe the HCCF model could well challenge VA's 
ability to provide alternatives to maintaining directly its existing 
130 nursing home care units now called ``community living centers''), 
homelessness programs, domiciliary facilities, compensated work therapy 
programs, hospice and respite, 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/dysfunction 
centers, 10 blind rehabilitation centers, a variety of unique ``centers 
of excellence'' (in geriatrics, gerontology, mental illness, 
Parkinson's, and multiple sclerosis), and various critical care 
programs for veterans with serious and chronic mental illnesses.
    In general, the IBVSOs believe the HCCF proposal could be a 
positive development, with good potential. But the process must be 
transparent to all those involved--veterans, stakeholders, community 
leaders, VA employees--and there must be a well-thought-out and well-
communicated plan to carry out the HCCF policy. It has been proven that 
leasing can help to diminish 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, Vet Centers, and leased VA regional office staff expansions. 
However, the IBVSOs remain concerned with VA's plan for obtaining 
inpatient services under the HCCF model, and have many unanswered 
questions. There are major concerns with the pervasive contracting that 
would be mandated by this type of proposal.
    Acknowledging all the changes taking place in health care, VA needs 
to look very closely at all its infrastructure plans, and needs to do a 
better job explaining to veterans, their representatives, and Congress 
what its plans are for every location, with a full exposition based on 
facts.
    Responding to a Congressional request, VA addressed a number of 
specific questions related to its plan for the HCCF leasing initiative, 
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; its projected cost over the next five 
years to complete; the extent to which national veterans organizations 
were involved in the development of the HCCF proposal; the engagement 
of community health-care providers related to capacity and willingness 
to meet veterans' needs; the ramifications on the delivery of long-term 
care and specialized services; and whether it would be able to ensure 
that needed inpatient capacity would remain available indefinitely.
    Based on its response, the IBVSOs believe VA has a reasonable 
foundation for assessing capital needs and has been forthright with the 
estimated total costs for ongoing major medical facility projects, and 
that the HCCF model can be a basis for meeting some of these needs at 
lower cost. We agree with VA's assertion that it needs a balanced 
capital assets program, of both owned and leased buildings, to ensure 
that demands are met under current projections. Likewise, we agree with 
VA that the HCCF concept could provide modern health-care facilities 
relatively quickly that might not otherwise be available because of the 
predictable constraints of VA's major construction program.
    However, 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.
    On the other hand, if VA plans to replace the majority or even a 
large fraction of all VA medical centers with Health Care Center 
Facilities, such a radical shift would pose a number of concerns for 
us. Nevertheless, the IBVSOs see this challenge as only a small part of 
the overall picture related to VA health infrastructure needs. The 
emerging HCCF plan does not address the fate of VA's 153 medical 
centers located throughout the Nation that are on average 60 years of 
age or older. It does not address long-term-care needs of the aging 
veteran population, inpatient treatment of the chronically and 
seriously mentally ill, the unresolved rural health access issues, the 
lingering questions on improving VA's research infrastructure, or the 
fate of VA's academic training programs. Fully addressing these and 
related questions is extremely important and will have an impact on 
generations of sick and disabled veterans far into the future.
    We would like to reiterate: Creating a VA of the 21st century must 
include all stakeholders' interests. The IBVSOs expect VA to establish 
any new infrastructure plan in a transparent way; vet that plan through 
our community and other interested parties; and provide its plan to 
Congress for review, oversight, and approval if required by law. 
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, veterans' advocates, 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.
    Finally, one of our community's frustrations with respect to VA's 
infrastructure plans is lack of consistent and periodic updates, 
specific information about project plans, and even elementary 
communications. The IBVSOs ask that VA improve the quality and quantity 
of communications with us, our larger community, enrolled veterans, 
concerned labor organizations, and VA's own employees, affiliates, and 
other stakeholders as the VA capital planning process moves forward. We 
believe that all of these groups must be made to understand VA's 
strategic plan and how it may affect them, positively and negatively.
    Talking openly and discussing potential changes will help resolve 
the understandable angst about these complex and important questions of 
VA health-care infrastructure. While we agree that VA is not the sum of 
its buildings, and that a veteran patient's welfare must remain at the 
center of the Department's concern, VA must be able to maintain an 
adequate infrastructure around which to build and sustain ``the best 
care anywhere.''
    If VA keeps faith with these principles, the IBVSOs are prepared to 
aid and support VA in accomplishing this important goal.
Recommendations:
    VA must develop a well-thought-out health-care infrastructure and 
strategic plan that becomes the means for it to establish a veterans 
health-care system for the 21st century. Congress, the Administration, 
and internal and external stakeholders must work together to secure 
VA's future, while maintaining the integrity of the VA health-care 
system and all the benefits VA brings to its unique patient population.
    VA's new proposal, the Strategic Capital Investment Planning (SCIP) 
and VA's health Care Center facility leasing proposal must be clearly 
explained and integrated with all stakeholders involved in the process, 
including how will it be developed, prioritized, and implemented, and 
how it will impact VA's specialized medical care programs, continuity 
of high-quality care, delivery of comprehensive services, protection of 
VA biomedical research and development programs, and particularly the 
sustainment of VA's renowned graduate medical education and health 
profession training programs.
    VA must improve the quality and quantity of communications with 
internal and external communities of interests, including the authors 
of this Independent Budget, concerning its plans for future 
infrastructure improvements through the HCCF leasing and other 
approaches.
    VA must improve the quality and quantity of communications with 
internal and external communities of interests, including the authors 
of this Independent Budget, concerning its plans for future 
infrastructure improvements through the HCCF leasing and other 
approaches.
            empty or underutilized space at medical centers:
The Department of Veterans Affairs must use empty and underutilized 
        space appropriately.
    The Department of Veterans Affairs maintains approximately 1,100 
buildings that are either vacant or underutilized. An underutilized 
building is defined as one where less than 25 percent of space is used. 
It costs VA from $1 to $3 per square foot per year to maintain a vacant 
building. Studies have shown that the VA medical system has extensive 
amounts of empty space that can be reused for medical services. It has 
also been shown that unused space at one medical center may help 
address a deficiency that exists at another location. Although the 
space inventories are accurate, the assumption regarding the 
feasibility of using this space is not. Medical facility planning is 
complex. It requires intricate design relationships for function, as 
well as the demanding requirements of certain types of medical 
equipment. Because of this, medical facility space is rarely 
interchangeable, and if it is, it is usually at a prohibitive cost. 
Unoccupied rooms on the eighth floor used as a medical surgical unit, 
for example, cannot be used to offset a deficiency of space in the 
second floor surgery ward. Medical space has a very critical need for 
inter- and intradepartmental adjacencies that must be maintained for 
efficient and hygienic patient care.
    When a department expands or moves, these demands create a domino 
effect on everything around it. These secondary impacts greatly 
increase construction expense and can disrupt patient care. Some 
features of a medical facility are permanent. Floor-to-floor heights, 
column spacing, light, and structural floor loading cannot necessarily 
be altered. Different aspects of medical care have various requirements 
based upon these permanent characteristics. Laboratory or clinical 
spacing cannot be interchanged with ward space because of the different 
column spacing and perimeter configuration. Patient wards require 
access to natural light and column grids that are compatible with room-
style layouts. Laboratories should have long structural bays and 
function best without windows. When renovating empty space, if an area 
is not suited to its planned purpose, it will create unnecessary 
expenses and be much less efficient if simply renovated. Renovating old 
space, rather than constructing new space, often provides only marginal 
cost savings. Renovations of a specific space typically cost 85 percent 
of what a similar, new space would cost. Factoring in domino or 
secondary costs, the renovation can end up costing more while producing 
a less satisfactory result.
    Renovations are sometimes appropriate to achieve those critical 
functional adjacencies, but are rarely economical. As stated earlier in 
this analysis, the average age of VA facilities is 60 years. Many older 
VA medical centers that were rapidly built in the 1940s and 1950s to 
treat a growing war veteran population are simply unable to be 
renovated for modern needs. Most of these so called ``Bradley-style'' 
buildings were designed before the widespread use of air conditioning 
and the floor-to-floor heights are very low. Accordingly, it is 
impossible to retrofit them for modern mechanical systems. Many of them 
also have long, narrow wings radiating from small central cores, an 
inefficient way of laying out rooms for modern use. This central core, 
too, has only a few small elevator shafts, complicating the vertical 
distribution of modern services. Another important problem with this 
existing unused space is its location. Much of it is not in a prime 
location; otherwise, it would have been previously renovated or 
demolished for new construction. This space is typically located in 
outlying buildings or on upper floor levels and is unsuitable for 
modern use.
    Public Law 108-422 incentivized VA's efforts to properly dispose of 
excess space by allowing VA to retain the proceeds from the sale, 
transfer, or exchange of certain properties in a Capital Asset Fund 
(CAF). Further, that law required VA to develop short- and long-term 
plans for the disposal of these facilities in an annual report to 
Congress. VA must continue to develop these plans, working in concert 
with architectural master plans and the long-range vision for all such 
sites.
Recommendations:
    VA must develop a plan for addressing its excess space in non 
historic properties that is not suitable for medical or support 
functions because of its permanent characteristics or locations.
                program for architectural master plans:
Each VA medical facility must develop a detailed master plan and 
        delivery models for quality health care that are in a constant 
        state of change as a result of factors that include advances in 
        research, changing patient demographics, and new technology.
    The Department of Veterans Affairs must design facilities with a 
high level of flexibility in order to accommodate new methods of 
patient care and new standards of care. VA must be able to plan for 
change to accommodate new patient care strategies in a logical manner 
with as little effect as possible on other existing patient care 
programs. VA must also provide for growth in existing programs based on 
projected needs through capital planning strategy.
    A facility master plan is a comprehensive tool to examine and 
project potential new patient care programs and how they might affect 
the existing health-care facility design. It also provides insight with 
respect to growth needs, current space deficiencies, and other facility 
needs for existing programs and how they might be accommodated in the 
future with redesign, expansion, or contraction.
    In many past cases VA has planned construction in a reactive 
manner. Projects are first funded and then placed in the facility in 
the most expedient manner, often not considering other future projects 
and facility needs. This often results in short-sighted construction 
that restricts rather than expands options for the future. The 
Independent Budget veterans service organizations believe that each VA 
medical center should develop a comprehensive facility master plan to 
serve as a blueprint for development, construction, and future growth 
of the facility; $15 million should be budgeted for this purpose.
    We believe that each VA medical center should develop a 
comprehensive facility master plan to serve as a blueprint for 
development, construction, and future growth of the facility. VA has 
undertaken master planning for several VA facilities, and we applaud 
this effort. But VA must ensure that all VA facilities develop master 
plan strategies to validate strategic planning decisions, prepare 
accurate budgets, and implement efficient construction that minimizes 
wasted expenses and disruption to patient care.
Recommendations:
    Congress must appropriate $15 million to provide funding for each 
medical facility to develop a 10-year comprehensive facility master 
plan. The master plan should include all services currently offered at 
the facility and should also include any projected future programs and 
services as they might relate to the particular facility. Each facility 
master plan is to be reviewed every five years and modified accordingly 
based on changing needs, technologies, new programs, and new patient 
care delivery models.
              architect-led design-build project delivery:
The Department of Veterans Affairs must evaluate use of architect-led 
        design-build project delivery.
    VA currently employs two project delivery methods: design-bid-build 
and design-build. Design-bid build project delivery is appropriate for 
all project types. Design-build is generally more effective when the 
project is of a low complexity level. It is critical to evaluate the 
complexity of the project prior to selection of a method of project 
delivery.
    Design-bid-build is the most common method of project design and 
construction. In this method, an architect is engaged to design the 
project. At the end of the design phase, that same architect prepares a 
complete set of construction documents. Based on these documents, 
contractors are invited to submit a bid for construction of the 
project. A contractor is selected based on this bid and the project is 
constructed. With the design-bid-build process, the architect is 
involved in all phases of the project to insure that the design intent 
and quality of the project is reflected in the delivered facility. In 
this project delivery model, the architect is an advocate for the 
owner.
    The design-build project delivery method attempts to combine the 
design and construction schedules in order to streamline the 
traditional design-bid-build method of project delivery. The goal is to 
minimize the risk to VA and reduce the project delivery schedule. 
Design build, as used by VA, is broken into two phases. During the 
first phase, an architect is contracted by VA to provide the initial 
design phases of the project, usually through the schematic design 
phase. After the schematic design is completed, VA contracts with a 
contractor to complete the remaining phases of the project.
    This places the contractor as the design builder. One particular 
method of project delivery under the design-build model is called 
contractor-led design build. Under the contractor-led design-build 
process, the contractor is given a great deal of control over how the 
project is designed and completed. In this method, as used by VA, a 
second architect and design professionals are hired by the contractor 
to complete the remaining design phases and the construction documents 
for the project. With the architect as a subordinate to the contractor 
rather than an advocate for VA, the contractor may sacrifice the 
quality of material and systems in order to add to his own profits at 
the expense of VA. In addition, much of the research and user interface 
may be omitted, resulting in a facility that does not best suit the 
needs of the patients and staff.
    Use of contractor-led design-build has several inherent problems. A 
short-cut design process reduces the time available to provide a 
complete design. This provides those responsible for project oversight 
inadequate time to review completed plans and specifications. In 
addition, the construction documents often do not provide adequate 
scope for the project, leaving out important details regarding the 
workmanship and/or other desired attributes of the project. This makes 
it difficult to hold the builder accountable for the desired level of 
quality. As a result, a project is often designed as it is being built, 
compromising VA's design standards.
    Contractor-led design-build forces VA to rely on the contractor to 
properly design a facility that meets its needs. In the event that the 
finished project is not satisfactory, VA may have no means to insist on 
correction of work done improperly unless the contractor agrees with 
VA's assessment. This may force VA to go to some form of formal dispute 
resolution, such as litigation or arbitration. An alternative method of 
design-build project delivery is architect-led design-build. This model 
places the architect as the project lead rather than the builder. This 
has many benefits to VA. These include ensuring the quality of the 
project, since the architect reports directly to VA.
    A second benefit to VA is the ability to provide tight control over 
the project budget throughout all stages of the project by a single 
entity. As a result, the architect is able to access pricing options 
during the design process and develop the design accordingly. Another 
advantage of architect-led design-build is in the procurement process. 
Since the design and construction team is determined before the design 
of the project commences, the request-for-proposal process is 
streamlined. As a result, the project can be delivered faster than the 
traditional design-bid-build process. Finally, the architect-led 
design-build model reduces the number of project claims and disputes. 
It prevents the contractor from ``low-balling,'' a process in which a 
contractor submits a very low bid in order to win a project and then 
attempts to make up the deficit by negotiating VA change orders along 
the way.
    In addition to selecting the proper method of project delivery, 
there is much to learn from the design and construction process for 
each individual project. It is important for VA to apply these 
``lessons learned'' to future projects.
Recommendations:
    VA must establish a category system ranking design/construction 
project types by complexity. This system should be used to determine if 
the project is a candidate for the design-build method of project 
management. The design-build method of project delivery should only be 
used on projects that have a low complexity, such as parking structures 
and warehouses. For health-care projects, VA must evaluate the use of 
architect-led design build as the preferred method of project delivery 
in place of contractor-led design-build project delivery. VA must 
institute a program of ``lessons learned.'' This would involve 
revisiting past projects and determining what worked, what could be 
improved, and what did not work. This information should be compiled 
and used as a guide to future projects. This document should be updated 
regularly to include projects as they are completed.
  increase need for va research space and infrastructure mprovements:
The Department of Veterans Affairs needs research space renovations and 
        improved infrastructure.
    A state-of-the-art physical environment for VA research promotes 
excellence in science as well as teaching and patient care. Research 
opportunities help VA recruit and retain the best and brightest 
clinician scientists to care for veterans. However, many VA facilities 
effectively have run out of usable research space. Also, research 
``wet'' laboratory ventilation, electrical supply, plumbing, and other 
projects appear frequently on internal VA lists of needed upgrades 
along with research space renovations and new construction, but these 
projects languish due to the weight VA places on direct medical care 
projects as opposed to research space and facility needs.
    Five years ago, the House Appropriations Committee expressed 
concern (House Report 109-95) that ``equipment and facilities to 
support the research program may be lacking and that some mechanism is 
necessary to ensure the Department's research facilities remain 
competitive.'' The Committee directed VA to conduct a comprehensive 
review of its research facilities and report to the Congress on the 
deficiencies found and suggestions for correction of the identified 
deficiencies.
    To comply, VA initiated a comprehensive assessment of VA research 
infrastructure. To prompt VA to complete its long overdue assessment, 
House Report 111-564 accompanying the FY 2011 VA appropriations bill 
directed the Department to provide its final report to Congress by 
September 1, 2010, with details of any recent renovations or new 
construction.
    As of publication of this Independent Budget, VA had not released 
the results of its review. According to an October 26, 2009, VA report 
to the VA National Research Advisory Committee, however, preliminary 
results of the review indicated, ``there is a clear need for research 
infrastructure improvements throughout the system, including many that 
impact on life safety.''
    The Independent Budget veterans service organizations (IBVSOs) are 
concerned that a significant cause of VA's research infrastructure 
neglect is that neither VA nor Congress provides direct funding for 
research facilities. The VA Medical and Prosthetic Research 
appropriation excludes funding for construction, renovation, or 
maintenance of VA research facilities. VA researchers must rely on 
their local facility management to repair, upgrade, and replace 
research facilities and capital equipment associated with VA's research 
laboratories. As a result, VA research competes with other medical 
facility direct patient care needs (such as medical services 
infrastructure, capital equipment upgrades and replacements, and other 
medical maintenance needs) for funds provided under either the Major 
Medical Facility, Minor Construction, or Medical Facilities 
appropriations accounts.
    The IBVSOs believe that correction of VA's known infrastructure 
deficiencies should become a higher VA and Congressional priority. 
Therefore, we recommend VA promptly submit to Congress the report it 
requested in 2006, provide construction funding sufficient to address 
VA's five highest priority research facility construction needs as 
identified in its facilities assessment report, and approve a pool of 
funding targeted at renovating existing research facilities to address 
the current and well-documented shortcomings in research 
infrastructure. For these funding needs we recommend $150 million and 
$50 million, respectively. Additionally, an emerging problem is that VA 
research facilities often are not an integral component of planning for 
new VA medical centers (including new medical centers in Las Vegas, 
Denver, and Orlando).
    Modern-day biomedical research needs customized power, safety, 
privacy, and configuration requirements that should be fundamental to 
the new construction planning processes, not an expensive afterthought. 
The IBVSOs urge the Administration to require that research space be 
made an integral component of planning for every new medical center and 
that such space be designed by architects and engineers experienced in 
contemporary research facility requirements.
Recommendations:
    Congress should require VA to report its findings from its research 
infrastructure review, now pending more than five years. Congress 
should authorize construction of, and appropriate $150 million in FY 
2012 to advance, the five highest priority research construction 
projects identified by VA in its research infrastructure review, and 
provide VA an additional $50 million in maintenance funding (in the Non 
Recurring Maintenance account) in FY 2012 to address current shortfalls 
in VA's research laboratories and other research space.
               preservation of va's historic structures:
The Department of Veterans Affairs must further develop a comprehensive 
        program to preserve and protect its inventory of historic 
        properties.
    The Department of Veterans Affairs has an extensive inventory of 
historic structures that highlight America's long tradition of 
providing care to veterans. These buildings and facilities enhance our 
understanding of the lives of those who have worn the uniform, of those 
who cared for their wounds, and of those who helped to build this great 
Nation. Of the approximately 2,000 historic structures in the VA 
historic building inventory, many are neglected and deteriorate year 
after year because of a lack of any funding for their upkeep. These 
structures should be stabilized, protected, and preserved because they 
are an integral part our Nation's history.
    Most of these historic facilities are not suitable for modern 
patient care but may be used for other purposes. For the past seven 
years, The Independent Budget veterans service organizations (IBVSOs) 
have recommended that VA conduct an inventory of these properties to 
classify their physical condition and study their potential for 
adaptive reuse. VA has moved in that direction; historic properties 
have been identified. Many of these buildings have been placed in an 
``Oldest and Most Historic'' list and require immediate attention.
    The cost for saving some of these buildings is not very high 
considering that they represent a part of American history. Once gone, 
they cannot be recaptured. For example, the Greek Revival Mansion at 
the VA Medical Center in Perry Point, Maryland, built in the 1750s can 
be restored and used as a facility or network training space for about 
$1.2 million. The Milwaukee Ward Memorial Theater, built in 1881, could 
be restored as a multipurpose facility at a cost of $6 million. These 
expenditures would be much less than the cost of new facilities and 
would preserve history simultaneously. The preservation of VA's 
historic buildings also fits into the VA's commitment to ``green'' 
architecture. Materials would be reused, reducing the amount of 
resources needed to manufacture and transport new materials to building 
sites.
    As part of its adaptive reuse program, VA must ensure that 
facilities that are leased or sold are maintained properly. VA's legal 
responsibilities could, for example, be addressed through easements on 
property elements, such as building exteriors or grounds. The IBVSOs 
encourage VA to use the tenants of Public Law 108-422, the ``Veterans 
Health Programs Improvement Act,'' in improving the plight of VA's 
historic properties. This act authorizes historic preservation as one 
of the uses of the proceeds of the capital assets fund resulting from 
the sale or leases of other unneeded VA properties.
Recommendations:
    VA must continue to develop a comprehensive program to preserve and 
protect its inventory of historic properties. VA must allocate funding 
for adaptive reuse of historic structures and empty or underutilized 
space at medical centers.

    Madam Chairwoman, this concludes my statement. I would be happy to 
answer any questions that you or the Members of the Committee may have.

    Chairman Murray. Thank you very much.
    Mr. Tetz.

     STATEMENT OF TIM TETZ, DIRECTOR, NATIONAL LEGISLATIVE 
                COMMISSION, THE AMERICAN LEGION

    Mr. Tetz. Madam Chair, Ranking Member Burr, thank you for 
opportunity to come before you and testify on behalf of the 
American Legion.
    As a parent of an 8- and 10-year-old, I am continually 
presented with tears and crying. As every parent knows, all 
crying is not the same. All tears do not have the same weight. 
There is a reason for the water works, the crying. Your task as 
a parent is to find it, find the base reason, then you have a 
much better chance of having a peaceful evening; but if you are 
successful in finding only one of the reasons, your evening is 
bound to be less than enjoyable.
    Crying might have been what brought her pain to your 
attention but the underlining symptom might be a fever of 104. 
Your first response has to be to get that fever down; but 
ultimately, if you want to have a lasting success, you need to 
understand the underlying causes of the fever. Crying is one 
symptom. The fever is another. The true problem is an 
infection.
    Congress, the VA, and the veterans' service organizations 
have presented with or demonstrated on a number of occasions 
some of this crying, some of these symptoms. We have all had 
our moments of crying. Our task must now focus on treating 
those symptoms of that underlying infection. This infection 
manifests itself in many ways.
    We have all spoken to the backlog of claims. VA processes 
over a million claims a year. Over the past years we have 
thrown money at IT solutions in the form of VBMS, personnel, 
and wave after wave of new hires, and a multitude of new pilot 
programs. Yet have we treated the symptom or the root 
infection?
    The VA claim system is broken because VA places an undue 
stress on the numbers of claims processed and a minimal stress 
on accuracy. New IT tools that are used to implement the old 
system will just allow us to make these mistakes faster. It 
will not unclog the system because the cycle of improper 
denials and appeals will not go away.
    This budget gives VA quite a bit of money to implement the 
IT programs and initiatives. But does it fix it all the way? 
Does it establish a system that incorporates rules-based 
processing to enhance accuracy? VA must build a system that 
tracks individual error and holds stations accountable for not 
only the volume of work they accomplish but also the accuracy 
of that work.
    Treat the root of the problem, not the symptom. Spending 
money to prevent symptoms and infection from rising is just as 
important as treating them once they arise.
    Investment in infrastructure and facilities ensures that 
today's cough does not turn into tomorrow's infection. 
Infrastructure, modernization, and facilities adequate to meet 
the needs of our Nation's veteran population--these are 
foundational expenditures.
    Construction money is money you have to spend now or you 
will surely spend it later. When you spend it later, you always 
spend more.
    The American Legion is troubled to see the proposed major 
construction has dropped from $1.1 billion in 2010 to less than 
half that figure in 2012 with minor construction also seeing a 
nearly $200 million decrease.
    We have seen firsthand in our annual System Worth Saving 
(SWS) visits, the need for such expansion and infrastructure to 
meet the needs of the growing veterans community, and we 
strongly urge Congress to at least meet the previous level of 
funding.
    This cannot be an area to cut corners when so many rural 
veterans are hungry for access to the VA health care, when 
urban facilities lack the adequate needs, and when cities like 
Denver, New Orleans, and Las Vegas await new medical centers to 
serve the veterans in a manner they deserve.
    The American Legion remains cautiously optimistic that the 
Fiscal Year 2012 Budget proposal will meet the needs of our 
Nation's veterans.
    We appreciate the effort the VA has made toward addressing 
the symptoms and issues that currently face our Nation's 
veterans. We challenge their reduction of funding in programs 
and budgets that have long-term consequences.
    Full funding of the VA to meet the needs of veterans is 
essential. Regardless of politics, if there is a cost to be met 
to care for veterans who have borne the battle of this Nation, 
we must bear that cost. To do so requires sacrifice, but the 
American Legion understands the importance of insuring there is 
no waste in that sacrifice.
    Be vigilant and keep oversight over the VA to ensure that 
the money ``we the people'' give is spent as wisely as possible 
without waste and with efficiency and consistency.
    I thank you again for the opportunity to provide this 
testimony and will gladly answer any questions.
    [The prepared statement of Mr. Tetz follows:]
    Prepared Statement of Tim Tetz, Director, National Legislative 
                    Commission, The American Legion
    Madam Chairman and Members of the Committee: The American Legion 
welcomes this opportunity to comment on the President's Department of 
Veterans Affairs (VA) budget request for fiscal year (FY) 2012 and 
2013.
    The American Legion is pleased to see the budget, at a proposed 
10.6 percent increase over 2010 levels, recognizes many of the needs 
faced by veterans and that this continues to be an area where we must 
ensure proper funding. The nation is facing many difficult challenges, 
and the veterans of America face many of their own challenges. Not only 
do we see the return of large numbers from two overseas wars, we also 
face the challenges of an aging veterans' population from previous 
wars. Unemployment strikes veterans at a rate two thirds higher than 
the general population and medical challenges are only now beginning to 
be understood in the form of Traumatic Brain Injury (TBI) and long term 
issues such as the effects of environmental exposures in Vietnam and 
the Gulf War Theater and the psychological effects of war from 
Posttraumatic Disorder (PTSD).
    Not only do external challenges such as these affect veterans, but 
internal obstacles within VA also represent significant challenges to 
be met by a budget. VA is transforming to 21st century ``paperless'' 
technology through the Veterans Benefits Management System (VBMS.) Will 
it be enough to turn the tide against a rising backlog when VA is awash 
in a sea of claims that has topped one million each of the past two 
years? This is a major concern. VA facilities, be they medical, 
administrative or for the purposes of our national cemeteries are much 
in need of upgrades and expansion to properly serve the veterans' 
community.
    These all point to the importance of a fully funded VA to meet the 
needs of the growing numbers of veterans. It is vital to ensure that 
the mission set forth by President Lincoln, ``To care for him who shall 
have borne the battle, and for his widow and his orphan,'' must not be 
given short shrift despite the economic woes. This debt must be 
honored.
    However, this is also a time of fiscal responsibility. The American 
Legion believes there should never be a wasted dollar spent in the 
service of veterans and that a maximum amount of the money spent must 
find its way down to the veteran on the street level. If there is a 
cost to be paid to care for the veterans of this country we must pay 
it, but the money must be used efficiently and prudently. This is a 
time for smart money.
    Smart money is investing in infrastructure. Infrastructure is 
construction money wisely spent and research to stay ahead of medical 
conditions before the most devastating lasting effects can be felt. 
Smart money is avoiding duplicative spending and making sure the money 
saved goes to places where even a small shortfall can be a major 
setback. Smart money is ensuring the Information Technology (IT) 
transformation of VA does more to transform the operational mindset and 
less to give electronic tools that repeat the errors of the past--but 
with greater speed.
    It is also important to recognize investment in veterans is not 
investment in a vacuum or isolated community that has little impact on 
the rest of America. It was once noted that if you wanted to ``reach 
the veterans of America'' you should simply speak to the whole of 
America, for they have integrated into near every community. Urban or 
rural, from Washington state to Puerto Rico and Maine to Hawaii 
veterans are an integral part of the community and money invested in 
veterans shores up these communities.
    A simple example is VA's Home Loan program, which provides low 
interest loans to veterans with no down payment and minimal closing 
costs. In a time where foreclosures have crippled the American housing 
markets, VA Home Loans have performed better than any other class of 
loans. In fact, according to the Mortgage Bankers Association, in 2010, 
the VA's percentage of loans that are seriously delinquent or in 
foreclosure is the lowest of all measured loan types--lower even than 
prime loans. In this way it is clear to see that investing in veterans 
can provide stability to communities that help all citizens in the 
difficult economy. It is all the more important that vital, community 
stabilizing programs such as the VA Home Loan program, receive full 
funding and are not curtailed in a short sighted aim of trimming a 
budget that only creates greater costs in the future.
    There are, however, two issues the American Legion urges Congress 
to address that will make this program fully functional and as 
effective as it deserves to be: first--the extension of the VA's 
maximum guaranty amount which is currently set to snap back at the end 
of this fiscal year; and second--providing a fee structure that is not 
over-burdensome but ensures that the program is self-sustaining. Surely 
a self sustaining program that provides stability to America's housing 
market while returning the investment that veterans have made to their 
country is about as smart money as Congress can provide.
    This is not a line-by-line excoriation and examination of a budget. 
This is an attempt to recognize the important areas The American Legion 
believes Congress must consider while determining the overall budget. 
Washington DC has a reverence for the new. Part and parcel of this 
reverence is often to roll out sexy new programs to solve the errors of 
the past, while letting the old programs languish in the background, 
still on the books and draining money, yet broken and creating drag on 
operations like a jammed chain on a bicycle. Sometimes the smarter 
choice is to ensure what you already have is working. It can be better 
to make fundamental repairs that bolster the existing system rather 
than throw the baby out with the bath water and reinvent the wheel.
    The VA has a unique medical system that is tailor-made to push 
cutting edge research, but it must be bolstered and funded to do so. 
The VA is expanding medical facilities and programs to provide outreach 
to rural veterans who are a more difficult community to serve. As more 
veterans move to rural areas, this must be continued to help meet their 
needs. VA has dedicated doctors and health care professionals who work 
hard to treat the veterans of this country; they must have the best 
facilities we can provide them. Veterans must have basic amenities at 
their health care facilities like parking and child care, or they 
cannot make use of the excellent system that serves their health care 
needs. There is an extensive network of state veterans' homes, yet 
duplicative evaluation of these homes by both VA and SMS leads to 
millions of dollars of waste that could be better applied elsewhere, 
and this is only one example of overlap. VA has spent millions of 
dollars on dozens and dozens of pilot programs to fix the model of 
operations that has led to a multiyear backlog for veterans' disability 
claims. It's time to make the most of the lessons gleaned from these 
pilots and Congressional studies; it's time to stop studying and start 
implementing.
                    medical and prosthetic research
While the President's proposed budget points to $6.2 billion in funds 
        to care for TBI and PTSD, the vast majority of this money is 
        directed solely at care and not at funding the research that 
        will improve care and reduce the future costs incurred in 
        treating these conditions.
    The American Legion believes VA's focus in research must remain on 
understanding and improving treatment for medical conditions that are 
unique to veterans. Servicemembers are surviving catastrophically 
disabling blast injuries due to the superior armor they are wearing in 
the combat theater and the timely access to quality combat medical 
care. The unique injuries sustained by the new generation of veterans 
clearly demand particular attention. It has been reported that VA does 
not have state-of-the-art prostheses like DOD and that the fitting of 
prostheses for women has presented problems due to their smaller 
stature.
There is no reason that VA should not be the preeminent source of 
        research in the world in the treatment of PTSD, TBI and 
        prosthetic and amputee medicine.
    There is a need for adequate funding of other VA research 
activities, including basic biomedical research and bench-to-bedside 
projects. Congress and the Administration should continue to encourage 
acceleration in the development and initiation of needed research on 
conditions that significantly affect veterans, such as prostate cancer, 
addictive disorders, trauma and wound healing, Post Traumatic Stress 
Disorder, rehabilitation, and other research that is conducted jointly 
with DOD, the National Institutes of Health (NIH), other Federal 
agencies, and academic institutions.
    As challenging health concerns such as the long term effects of 
TBI, exposures to environmental hazards in domestic and overseas 
deployment, and the mental health impact of exposure to combat 
conditions as well as sexual trauma and assault develop, it is 
essential that VA lead the way in research and development to combat 
and treat these conditions. Servicemembers affected by these conditions 
will have a deep and lasting effect on the economy through their 
ability to contribute if these conditions are not treated and 
mitigated. Learning to attack these conditions early can very often be 
the difference between manageable symptomatology and more devastating 
and less treatable levels in the future. Quite simply, the more that 
can be learned about diagnosing and treating these conditions, the more 
likely this Nation can avert catastrophic impact in the future.
    Yet this proposed budget cuts funding from this vital area. The FY 
2010 Final Budget saw an allocation of $581 million in this area, 
slashed by $72 million to $509 million in the proposed FY 2012 Budget. 
In a budget seeing increases in many other areas, a reduction to this 
critical area cannot be overlooked.
    Truly, investing in research at the onset is investing in the 
future. While The American Legion applauds the VA budget's stated 
research priorities of Mental Health, Gulf War Illness and 
Environmental Exposures, Prosthetics, and Traumatic Brain Injury and 
Spinal Cord Injuries, the allocated $509 million should be made more 
robust. As the lesson learned from Agent Orange exposure in Vietnam 
should have taught us, research delayed into developing residuals of 
war can have devastating economic impact down the road. Money invested 
now in this research has the potential to not only save this Nation 
money in the long run, but also ameliorate and alleviate the suffering 
of veterans at a time when the long-term impact can be minimized.
                     construction--major and minor
    As a part of the preparation for the annual System Worth Saving 
(SWS) reports, The American Legion has seen firsthand the structural 
deficiencies and challenges faced with the infrastructure of the VA 
health care system. During those site visits, many VA Medical Center 
staff have informed Legion personnel that they are unable to dedicate 
needed funds toward construction projects due to the funding needs of 
actual medical care. Furthermore, many VA construction projects were 
only made possible through the use of funding from the America 
Reinvestment and Recovery Act. Such money is no longer available to 
meet the construction needs to shore up VA infrastructure in areas such 
as seismic criteria, aging electrical systems, insufficient parking and 
space utilization, and other needed areas. Therefore, the need to fully 
fund this area of the budget is even more apparent.
    Recent reports of the VA Regional Office in Roanoke, VA noted that 
the floors of the building were in danger of collapsing due to the 
aggregate weight of the files. While this highlights yet another major 
implication of the claims backlog, it further underlines that this is 
not an area where VA can afford to scrimp and save. Substandard 
facilities do not serve the veterans of this country.
Construction is money that must be spent, either now or later. When the 
        choice is made to spend later, the cost is always much higher.
    If we are to truly invest in the future of this country, there are 
few more sound decisions to be made than investing in infrastructure. 
Just as the roads and bridges of America must be shored up to support 
the crumbling infrastructure and prevent even greater costs down the 
road, so too must the infrastructure of VA be solidified to meet the 
needs of the growing veterans' community.
    Whether it is much needed medical facilities to the rural regions 
of the country, repairs to aging urban hospitals, proper laboratory 
facilities, adequate parking, or other needs, it is short sighted to 
see opportunities to cut here, for cuts to this area now will only 
bring greater costs down the road. The wise fiscal decision is to 
invest carefully now to head off ballooning costs in the future.
                               it systems
    Since the data theft occurrence in May 2006, VA has implemented a 
complete overhaul of its Information Technology (IT) division 
nationwide. The American Legion hopes VA continues to take the 
appropriate steps to strengthen its IT security to regain the 
confidence and trust of veterans who depend on VA for the benefits they 
have earned.
    As acknowledged by the GAO Report 11-265, ``Electronic Health 
Records: DOD and VA Should Remove Barriers and Improve Efforts to Meet 
Their Common System Needs'' there are still major hurdles to be 
overcome to achieve the goals set forth of a Virtual Lifetime 
Electronic Record for servicemembers from induction through the rest of 
their lives as active duty and veteran. The President's budget sets 
aside monies for this purpose, but it is vitally important to ensure 
that this component is not left behind, nor allowed to falter. 
Achieving this goal should remain a major priority of both DOD and VA 
in cooperation with one another.
    The American Legion supports the centralization of VA's IT. The 
amount of work required to secure information managed by VA is immense. 
The American Legion urges Congress to maintain close oversight of VA's 
IT restructuring efforts and fund VA's IT to ensure the most rapid 
implementation of all proposed security measures.
    Obviously, with VA's transformation of the Veterans Benefits 
Administration (VBA) to a ``paperless'' processing system through the 
Veterans Benefits Management System (VBMS) this can be an area of great 
savings overall for VA as VBA moves out of the research and piloting 
stage of this system and into regular operations. Startup costs can now 
be eliminated and hopefully VA will be vigilant in ensuring that this 
new system offers the speed and accuracy promised.
                         fiscal responsibility
    Fiscal responsibility is, of course, a vital concern in the 
difficult times we are facing as a Nation. The American Legion believes 
strongly money spent must be utilized wisely. To this end, all aspects 
of operation must be scrutinized, and where waste and mismanagement 
needlessly contribute to an inflated budget, these must be eliminated. 
Rather than wholesale cutting of necessary infrastructure, areas of 
redundancy must be sought, and targeted cuts to those areas serve a far 
better purpose in managing the budget of VA.
    Better coordination with outside evaluations can help reduce 
internal costs of evaluation. State veterans' homes are evaluated not 
only by VA internal evaluation, but also by outside CMS evaluation. 
Better coordination and standardization of evaluation could result in 
reduced costs of VA evaluations of millions of dollars by reducing this 
level of redundancy. The American Legion has similarly called for some 
time for VA to accept outside, third party evaluation of accuracy and 
quality rates in the benefits management and claims system. Such 
outside evaluation could further reduce costs where areas of redundancy 
with VA's own evaluative process can be found.
    To be sure, such savings may seem small in comparison to the 
entirety of the budget. Elimination of the above redundancy could 
provide savings on the level of around $10 million. However, when 
considered against the balance of small areas where a little money goes 
a long way, the impact of such savings and the proper redistribution of 
this money could be great.
    VA's funding of State Cemetery Grants contributes in many ways to a 
vital task, providing for the respectful repose of our Nation's 
veterans in conjunction with the National Cemetery Administration 
(NCA.) The grants cover everything from major construction to basic 
irrigation and bringing these state cemeteries to National Shrine 
Standards. As the horrifying situation played out over the last few 
years across the river in Arlington National Cemetery has proven, or 
tales of missing headstones or grounds gone to seed and disrepair in 
other locations attest, there are few more unconscionable acts than to 
give substandard service to the families of veterans in their 
interment. NCA takes such failings seriously, and works tirelessly to 
preserve their status as one of the top two organizations in service 
and satisfaction in the entire Nation. We cannot fall short in meeting 
these National Shrine Standards. A mere $5 million dollars has been 
estimated to be the difference between fully funding the available 
projects and letting some projects slide to backlog status. Some 
projects may cost as little as a few hundred thousand dollars or even 
less. VA has already let our living veterans down by allowing claims 
service to fall into backlog status, they cannot afford to allow a 
similar lapse in our veterans' cemeteries.
    Better Central Office oversight is further needed at the local 
level to ensure that money directed to the VISNs and Regional Offices 
are being spent in accordance with the direction of the administration. 
All too often in The American Legion's visits to local areas as a part 
of the System Worth Saving (SWS) Reports and Regional Office Action 
Review (ROAR) sees wide variances in execution from region to region. 
To truly manage the budget of VA most effectively, developing uniform 
consistency is vital across the country.
    The President's budget includes vastly rising costs in 
administrative areas, such as increases ranging from 41% in the Office 
of the Secretary to nearly 100% in the Office of Policy Planning and 
well over even that for the Office of Public and Intergovernmental 
Affairs. Certainly VA has struggled to meet demands, and has been 
woefully late in compliance with implementation of Public Laws enacted. 
A HVAC DAMA Subcommittee meeting last year regarding Public Law 110-389 
that found nearly half of the provisions short of implementation well 
over a year and a half past the passage of the law. Delays in 
implementation and publication of new Agent Orange regulations are well 
documented. Certainly we must not overlook the recent tardiness in an 
implementation plan for the Caregivers' Act. If VA is short staffed and 
unable to comply with basic regulations for operations, they should be 
given adequate staffing. Congress has generously provided VA with 
additional staffing for their claims processors that Acting 
Undersecretary for Benefits Michael Walcoff has recently stated in 
testimony is now sufficient for VA to reduce the backlog and meet the 
Secretary's stated goal of no claims languishing longer than 125 days 
at a 98 percent accuracy rate. If the Central Office truly needs this 
plus up of numbers to adequately manage the ability of VA to complete 
their daily tasks, then this funding is welcomed.
    The American Legion does underline the need to ensure that this 
staffing is essential. As belts are tightened in budget season, not 
only in Washington but in every household across the country, we cannot 
afford wasteful spending. Every penny spent must be to the good cause 
of helping the veteran at ground level.
                               conclusion
    Madame Chairwoman and Members of the Committee, The American Legion 
believes it is absolutely critical that the entire military and 
veterans' community (active-duty, Reserve Component, and veterans) 
continue to remain supportive of honorable military service. No 
servicemember should ever doubt:

     the quality of health care he or she will receive if 
injured;
     the availability of earned benefits for honorable military 
service upon discharge; or
     the quality of survivors' benefits should he or she pay 
the ultimate sacrifice.

    A true investment in the future means investing in key areas of 
infrastructure now and not making short sighted cuts to vital areas 
that will only bring greater costs down the road.
    Full funding of essential projects such as research in emerging 
health risks and disabilities, as well as the physical infrastructure 
of VA facilities will be the prudent choice now to stave off even 
greater financial burdens down the road. VA must meet these challenges 
with an adequate budget to fund these necessary aims.

                                        VA MEDICAL DISCRETIONARY PROGRAMS
----------------------------------------------------------------------------------------------------------------
                                           P.L. 111-117                 President's      FY 2013       American
                                             FY 2010 VA  P.L. 111-322   FY 2012 VA      Proposed       Legion's
                                               Final       FY 2011 VA     Budget         Advance       FY 2013
                                              Funding       Funding      Proposal    Appropriations    Request
----------------------------------------------------------------------------------------------------------------
Medical Services.........................         $34.7         $37.1         $39.5  $41.3 billion         $38.1
                                                billion       billion       billion                      billion
Medical Support & Compliance.............  $4.9 billion  $5.3 billion  $5.4 billion   $5.7 billion          $5.3
                                                                                                         billion
Medical Facilities.......................  $4.8 billion  $5.7 billion  $5.4 billion   $5.4 billion          $6.2
                                                                                                         billion
Medical/Prosthetic Research..............  $581 million  $581 million  $509 million                         $600
                                                                                                         million
Medical Care Collections Fund............         [$2.9         [$2.9         [$3.1
                                               billion]      billion]      billion]
                                          ----------------------------------------------------------------------
    Total Medical Care...................         $47.9         $51.6         $53.9  $52.4 billion         $50.2
                                                billion       billion       billion                      billion
----------------------------------------------------------------------------------------------------------------


                                      VA NON-MEDICAL DISCRETIONARY PROGRAMS
----------------------------------------------------------------------------------------------------------------
                                                            P.L. 111-117                President's    American
                                                             FY 2010 VA   P.L. 111-322   FY 2012 VA    Legion's
                                                                Final      FY 2011 VA      Budget      FY 2012
                                                               Funding       Funding      Proposal     Request
----------------------------------------------------------------------------------------------------------------
Major Construction........................................  $1.2 billion  $1.2 billion         $590         $1.2
                                                                                            million      billion
Minor Construction........................................  $703 million  $703 million         $550         $800
                                                                                            million      million
State Veterans' Homes Construction Grants.................  $100 million  $100 million  $85 million         $100
                                                                                                         million
State Veterans' Cemeteries Construction Grants............   $46 million   $46 million  $46 million  $60 million
General Operating Expenses................................  $2.1 billion  $2.5 billion         $2.5         $2.6
                                                                                            billion      billion
Information Technology....................................  $3.3 billion  $3.3 billion         $3.2         $3.5
                                                                                            billion      billion
National Cemetery System..................................  $250 million  $250 million         $251         $260
                                                                                            million      million
----------------------------------------------------------------------------------------------------------------


    Chairman Murray. Thank you very much.
    Ms. Hooker.

    STATEMENT OF MARYANN D. HOOKER, M.D., LEAD NEUROLOGIST, 
WILMINGTON, DELAWARE, VA MEDICAL CENTER, REPRESENTING AMERICAN 
               FEDERATION OF GOVERNMENT EMPLOYEES

    Dr. Hooker. Thank you very much, Madam Chairman, Ranking 
Member Burr, and other Members of the Committee in absentia. 
Thank you for the opportunity to testify on behalf of AFGE 
regarding clinical staff and resource realignments mentioned in 
the VA's budget request.
    I joined VA in 1991. Prior to that, I rotated through 
several VA hospitals during medical school, internship, and 
residency. I greatly appreciate the education I received during 
my training years.
    I wonder how the proposed realignment will impact medical 
education and academic affiliations if physicians are shifted 
away from patients.
    As a neurologist, I work with a number of special patient 
populations: patients with spinal cord injury; multiple 
sclerosis; Traumatic Brain Injury; amyotrophic lateral 
sclerosis; dementia; and Parkinson's disease to mention a few.
    The veterans I see for second level Traumatic Brain Injury 
screens are sent to be evaluated for those subtle changes that 
cannot be picked up on routine examinations. Those changes that 
lead to many years of lost work, lost relationships, and lost 
lives due to missing the diagnosis.
    Parkinson's disease is another entity where specialty 
expertise is invaluable both in making the correct diagnosis 
and in developing the proper treatment in concert with the 
patient.
    I see a lot of women veterans who suffer from migraine and 
other pain syndromes where specialty care also lessons the 
burden of suffering and allows patients to lead more productive 
lives.
    Without knowing the specifics of VA's proposed changes, I 
can only speak from direct experience in saying that the 
substitution of other providers for physicians or LPNs for RNs 
may, in some cases, have very negative effects to the health 
care team--patient and provider alike.
    Each member serves a unique role. Indeed, the patient care 
center initiative of which Patient Aligned Care Teams or PACT 
is, but one aspect, if properly implemented, perfectly 
illustrates the symbiotic relationships inherent in providing 
good medical care.
    I have to tell you, though, because some of these 
initiatives have already begun, that I am seeing patients who 
have not seen their primary care provider in over 2 years.
    They are already lost to the VA system either through 
frustration with having to repeatedly call for appointments 
because there are no real openings or through the lack of 
adequate support staff to notify them of the need to make 
appointments, either by sending out the letters or making the 
telephone calls or even printing the reports to show who is 
missing from the system.
    Gaming strategies such as these to show the achievement of 
30-day access to providers will be even more egregious as VA 
implements 14-day access performance measures.
    Realignment leading to less care providers will only 
exacerbate these problems. Primary care providers already are 
overburdened by the constant need to document completion of 
ever increasing numbers of clinical reminders.
    They frequently are shifted among teams or clinical 
locations to cover staff shortages. They no longer know which 
patients are on their panels and patients no longer know their 
primary care provider.
    Rather than addressing failures in the current system, we 
are moving on to the next great thing that will not be fully 
funded at the facility level.
    All this constant shuffling of patients and care providers 
leads to high levels of staff turnover which is very costly. 
Nurses forced to work at the top of their scope, such as in the 
emergency department or intensive care unit, frequently are 
asked to work outside their scope. This leads to more stress, 
more burn out, more staff turnover, and more medical 
misadventures.
    Patients feel this stress too as they identify very 
strongly with their VA care providers.
    In our behavioral health service, 12 providers have left in 
less than 2 years. Only four have been replaced. For patients 
receiving behavioral health care services--our most fragile 
population, they are expected to cope, manage, and navigate 
themselves through a fractured system of care that is not 
integrated with primary care that itself is also fractured.
    Care Coordination Home Telehealth, is another program under 
the Patient Centered Care initiative, though this one with the 
goal of keeping patients out of the hospital and away from the 
clinics, also is not well-integrated with primary care.
    The nurses in this program work from templates and 
standardized order sets to manage the care of patients with 
complex problems such as diabetes, hypertension, and PTSD, all 
without the direct input of the patient's primary care 
provider.
    I view my work at VA as an avocation more than a vocation. 
I have a deep respect for the men and women who served and have 
served in the Armed Forces. My father was in the Army and was 
awarded the Bronze Star. It is in his honor that I serve; and 
it is in the honor of the servicemembers past and present, with 
them in mind on behalf of AFGE that I express concern over 
these proposed changes.
    Thank you.
    [The prepared statement Dr. Hooker follows:]
   Prepared Statement of Maryann D. Hooker, M.D., Lead Neurologist, 
   Wilmington, Delaware, VA Medical Center, Secretary, AFGE Local 342
    Chairman Murray, Ranking Member Burr and Members of the Committee: 
The American Federation of Government Employees (AFGE) and the AFGE 
National VA Council (NVAC) (hereinafter ``AFGE'') appreciate the 
opportunity to testify today on the Fiscal Year (FY) 2012 budget for 
the Department of Veterans' Affairs (VA). AFGE represents more than 
200,000 VA employees, including nearly 120,000 Veterans Health 
Administration (VHA) employees providing direct medical services to 
veterans.
    AFGE's testimony focuses primarily on the portion of the VA's FY 
2012 budget request that relates to ``Clinical Staff and Resource 
Realignment''. The budget request assumes yearly savings of $151 
million (in FY 2012 and FY 2013) based on three realignments:

     Conversion of selected physician to non-physician 
providers;
     Conversion of selected registered nurses (RN) to licensed 
practical nurses (LPN); and
     More appropriate alignment of required clinical skills 
with patient needs.

    The lack of details in this proposal leaves many questions 
unanswered: which physician duties will be assigned to an RN? Will LPNs 
replace RNs in both inpatient and outpatient settings? Will staff be 
realigned in behavioral health and specialized medical services?
    Without more specifics, it is difficult to assess whether these 
proposed conversions to lower skilled positions will result in a more 
efficient use of scarce VA medical dollars, or a harmful deskilling of 
the care we provide to veterans, many of whom are chronically ill or 
severely disabled. We urge the Committee to consider the following:

     How will the proposed staff realignment impact the quality 
of care that our veterans receive?
     How will it impact veterans' access to care?
     Will this realignment actually produce anticipated savings 
for taxpayers over the short run or the long run?
     Perhaps most important: Is the pursuit of these modest 
savings worth the risk of unintended consequences to veterans?

    Fortunately, AFGE's assessment need not be purely theoretical; the 
VA is already attempting to achieve efficiencies through staff 
realignment, telehealth, team-based care, group appointments and 
shorter appointments, among other cost containment strategies. 
Unfortunately, what AFGE has learned so far from our gives us cause for 
concern. Too often, these realignments and cost containment strategies 
are implemented without proper oversight or advance planning, resulting 
in reduced access and quality of care. Also, rather than saving money, 
they sometimes cost the taxpayer more, in the form of costly contract 
care, less continuity of care and higher staff turnover. We also note 
that every time patients are reassigned, care coordination may suffer, 
clinicians have to spend additional time to learn the needs of a new 
patient, and veterans have to build relationships with new providers.
    The impact of staff and resource realignment also will depend in 
part on whether it was planned or merely the unintended byproduct of 
budget shortfalls and hiring freezes. Yes, shortfalls and hiring 
freezes have not disappeared from the VHA landscape despite advance 
appropriations for FY 2011. AFGE recently received reports of 
shortfalls and hiring freezes from several VISNs. At the Wilmington VA, 
the Director just announced that no one can be hired on a permanent 
basis and the medical center budget is frozen.
    This news is both puzzling and troubling. AFGE joins the 
Independent Budget veterans service organizations (IBVSOs) in urging 
Congress, the Administration and GAO to ensure that this critical 
funding reform law is fully and properly implemented.
    Staff and resource realignment can and should be used in certain 
instances. For example, in some facilities, RN tasks such as 
administration of flu vaccines and B12 injections, are being reassigned 
to LPNs. In addition, many VA clinicians are unnecessarily burdened by 
administrative duties, due to new initiatives and reporting 
requirements. These clinicians already have extremely limited face time 
with patients; many primary care providers cannot spend a lot more than 
30 minutes with new patients, and rumors of 15 minute new patient 
appointments have resurfaced. Therefore, AFGE urges the Committee to 
take a close look at the growing administrative burdens placed on VA 
clinicians that divert scare appointment time away from patient 
interaction. We also hope the VA will reconsider its current efforts to 
downgrade the Patient Support Assistant positions that provide critical 
backup to clinicians.
    Clearly, the impact of staff realignments will also vary greatly 
depending on which medical services are targeted. At the Wilmington VA, 
the Pain Clinic Nurse Practitioner (NP) has had to run the clinic 
without the backup of an anesthesiologist. Like so many other VA 
initiatives, inadequate funding is provided for proper implementation 
of the VA's National Pain Initiative. As a result, the Wilmington has 
to send veterans out to non-VA facilities for their pain injections, 
resulting in delays and fractionated care. If RN positions such as 
these were converted to LPNs, the adverse impact on care could be 
significant.
    A report from a VISN 1 facility reveals similar realignment 
problems: That facility's Pain Team has a physician who mostly does 
back injections and an NP is in charge of medication management. For 
the more difficult and complex pain patients, it may be better and 
safer to have a physician perform medication management, especially 
when narcotics are involved.
    Realigning that increases the portion of specialty care delivered 
by a non-physician can also lead to delayed and fractionated care. When 
orthopedic patients see an NP or physician assistant for their first 
visit, they often have to return for a second appointment or go 
elsewhere in order to be examined by an orthopedist.
    At the Wilmington VA, realignment has adversely impacted veterans 
seeking emergency care for behavioral health problems. At the 
Wilmington VA, the first on-call for emergency behavioral health 
patients is a licensed clinical social worker. In this type of setting, 
physician extenders are placed under enormous pressures to carry out 
the duties and schedules designed for a physician, resulting in further 
burnout and higher attrition. They may also be forced to perform duties 
outside their scope of practice. More generally, AFGE urges the 
Committee to look at the attrition rate among social workers and 
psychologists who are expected to carry out many of the duties of a 
psychiatrist.
    Realignment-related problems may be especially difficult to detect 
and monitor in certain settings. For example, the Patient Aligned Care 
Team (PACT) is a laudable initiative that was recently described by 
Secretary Shinseki as an ``historic step in redefining medical care''. 
Unfortunately, implementation of PACT has been hindered by short 
staffing and poor coordination. Physicians and nurses already handling 
enormous workloads are required to take on new PACT duties. In some 
facilities, the only way to staff a PACT team is to transfer clinicians 
away from departments that are severely short-staffed.
    Our members report that some PACT teams operate without the regular 
participation of a physician. Then, the remaining team members are 
forced to ``realign'' themselves to cover the gap. AFGE has received 
several reports of RNs having to work outside their scope of practice 
as a result of these hard-to-detect realignment problems.
    We also share the concern of the IBVSOs that PACT could adversely 
impact specialty care if not implemented properly; staffing and 
coordination problems are likely to worsen the impact.
    Again, AFGE believes that PACT has great potential to improve VA 
care. We urge this Committee to investigate implementation problems and 
ensure that front line practitioners and their representatives have the 
opportunity to provide regular input into the evaluation process.
    We also urge greater oversight of VA's Telehealth program. Here 
too, staffing problems that may be difficult to detect are hindering 
implementation of a valuable VA initiative. We are troubled by reports 
from several facilities that physicians are pressured to refer and keep 
veterans in telehealth programs, even when, in their professional 
judgment, another form of care would better serve the patient. (Some 
physicians have been offered cash incentives to divert patients to 
telehealth.)
    In VISN 4, rural health care dollars were used to hire an NP at the 
Philadelphia VAMC. Then the VISN notified Wilmington's CBOC primary 
care providers that consults for cardiology, endocrinology and 
hematology/oncology could be placed through the coordinator at 
Philadelphia. If, after reviewing the consult, the specialist wants to 
see the patient, the patient would be required to bypass the Wilmington 
VA to go to the Philadelphia VA, even though Wilmington has the very 
cardiology, endocrinology and hematology/oncology specialty services 
the patient needs. (It is also troubling that the Philadelphia VA can 
only run an orthopedic surgery clinic one-half morning every other 
week, even though back and neck pain are among the top complaints 
causing veterans to seek care.)
    Diagnostics is another area where conversion to lower skilled 
positions could be problematic. For example, depending on the medical 
need, an NP substituting for an internist may be required to work 
outside of his or her scope of practice.
    As mentioned above, emergency care has suffered tremendously 
because of inadequate staffing. The goal is no longer to provide care 
to the veteran in the emergency department, but to refer the patient 
outside the VA system for care. At Wilmington, VA, we recently learned 
that the emergency department is slated to increase its maximum 
capacity from six to fourteen patients, yet administration wants to 
provide zero increase in nursing or physician staff. Recently, five 
patients each spent over 48 hours in the emergency department, 
including one who received two blood transfusions while he lay on a 
stretcher for two days. Meanwhile a 25-bed ward has sat idle for the 
past three years because of too few floor nurses.
Other concerns:
    AFGE is disappointed to see the return of VA's proposal to 
eliminate all continuing medical education (CME) reimbursement for 
physicians and dentists. The VA recruits prospective clinicians with 
the promise of professional growth, but is reluctant to comply with the 
1991 law that entitles clinicians to a modest sum for courses required 
to maintain certification and professional licenses.
    The justification provided (without any supporting data) in the FY 
2012 budget request is that physicians and dentists no longer need this 
recruitment/retention benefit because the pay system enacted in 2004 
has made the VA competitive with other employers. If VA is sufficiently 
competitive, why do so many facilities have trouble recruiting these 
clinicians, and why does the VA continue rely so heavily on more costly 
fee basis care to fill the gaps? Furthermore, the 2004 pay law (P.L. 
108-445) made no linkage to lower CME costs, but it did link better pay 
with less fee basis care--a desired outcome the VA has still not 
documented.
    Rather than arbitrarily cut this modest CME benefit, AFGE urges 
this Committee to first conduct comprehensive oversight of VA physician 
and dentist issues, including: ongoing problems with the base, market 
and performance pay provisions in the 2004 law, its impact on VA's use 
of fee basis care, whether AFGE's CME program (again, still at 1991 
levels) is competitive with other health care employers, the CME needs 
of other VA clinicians, and the impact of the physician/dentist ``24/
7'' scheduling rule on recruitment and retention.
    In addition, it would be valuable to finally understand why medical 
centers that run out of money to hire more front line practitioners 
usually find other funds to contract for more expensive non-VA care to 
fill the gap.
    Perhaps, instead of looking for modest savings through realignment 
and the use of fewer physicians and RNs, the VA may want to examine the 
enormous growth of staff and resources at the VISNs, and the percentage 
of VISN staff that do not provide or support direct patient care.

    Thank you.
                                 ______
                                 
 Posthearing Additional Information from Maryann D. Hooker, M.D., Lead 
 Neurologist, Wilmington, Delaware, VA Medical Center, Secretary, AFGE 
                               Local 342

[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

    Chairman Murray. Thank you very much. Thank you all for the 
work you put into providing this information for all of us, and 
excellent testimony from everybody.
    I do have follow-up questions for all of you. We are 
running out of time here today at the hearing. Everybody has 
been very patient.
    So I am just going to ask one or two questions and then 
turn to Senator Burr. I'll submit the rest to you and to ask 
you to respond.
    Mr. Violante, I do want to ask you--because claims backlog 
is a top issue everywhere we go, and you spoke a little bit 
about it in your testimony. I saw that the amount of funding in 
the President's Budget request for VBA in the GOE account is 
significantly less than the funding recommended by the IB.
    Can you elaborate on the IB's request and comment on the 
Administration's?
    Mr. Violante. Sure. First of all, if you look at the level 
that is being considered for 2011, the IB is roughly just a 
little less than $200 million more from 2011, roughly about 
$246 million above what the President is requesting.
    Most of that increase is for what we believe to be 
increased costs in supplies, and there is a modest increase for 
vocational rehabilitation counselors, which account for about 
150 individuals, and increases in the Board of Veterans' 
Appeals, roughly about 30 employees there.
    We believe that what we are asking for is just a very 
modest increase above 2011.
    Chairman Murray. Any comment on the Administration's 
request?
    Mr. Violante. We think it is a little low.
    Chairman Murray. That is sufficient. OK.
    Mr. Violante. I do not agree with Mr. Walcoff on the 
training part of it. We believe there needs to be much more 
training involved, especially when we are looking at the 
problems that the VA is facing.
    Chairman Murray. His testimony was that they would not be 
hiring as many so they did not need the training dollars. Tell 
me why you disagree with that.
    Mr. Violante. We do not believe that they are adequately 
trained at this point, that there needs to be additional 
training provided to the employees that they do have, and we 
believe that more funds should be expended on training those 
individuals.
    Chairman Murray. OK. Let me ask if anybody wants to comment 
on this. I think we all recognize these are very tough economic 
times and discretionary funding is going to be really hard to 
come by this year.
    I want to ask if anybody wants to comment, if you believe 
that the VA's proposed operational improvements are appropriate 
and will help VA to spend taxpayer dollars in a more efficient 
and cost-effective manner.
    If you all want to comment back for the record, you can do 
that.
    I see you are willing to jump in.
    Dr. Hooker. It is always dangerous to give me a microphone 
and a platform from which to speak.
    My concern would be losing the veterans that we have now 
that we have already lost and providing the care that they so 
desperately need; the efficiencies and the resources, I think, 
can be better utilized in fixing what it is we have now rather 
than promoting new initiatives that we have not tested at this 
point, as far as clinical care.
    Chairman Murray. Others? Go ahead, Carl, jump in.
    Mr. Blake. Joe and I are sitting here thinking, I think you 
would have to better define operational improvements. I mean, I 
know that they have a number of different areas where they 
identified projected savings. I think that is what you are 
referring to.
    Chairman Murray. Right.
    Mr. Blake. We could probably better answer that with a 
statement.
    Chairman Murray. If you could get back to me with some 
comments on that I would really appreciate it. Great.
    Chairman Murray. Senator Burr.
    Senator Burr. Once again, I want to thank all of you for 
your commitment to participate in The Independent Budget, more 
importantly, your willingness to come in here and share 
thoughts with us.
    The Chairman has pretty well spoken in what I think will be 
a protracted period of very difficult discretionary spending, 
not to just be encompassed in the next fiscal year but several 
to come.
    It is going to be vitally important that the decisions that 
are made at the VA do not lose focus on what the VA mission is 
and that is to provide the care that our veterans were 
promised.
    I have listened to some of additional requests that deal 
with training, that deal with expediting disability claims, 
that deal with construction needs. All of these are important.
    I guess my question to anybody that would like to take it 
is: you are seeing a massive expansion of FTEs within the 
central office of the VA. Is anybody asking why, and more 
importantly, how that affects the mission and the things that 
are of most concern to each and every one of you?
    My staff earlier in the week had just thrown down some 
things for me that we wanted to share with you to sort of set 
the stage for this.
    In the Fiscal Year 2012 Budget request for general 
administration, it breaks down the proposed number of FTEs. It 
calls for an increase of 562 employees over fiscal year 2010, 
most of whom are at a GS-12 or higher level.
    Now, I do not have to tell the veteran service 
organizations what they should be outraged about. But when you 
bring up the issues of construction, training, claims, the way 
I have broken it down I do not think that any of your issues 
are being addressed in the increase of 560 FTEs over fiscal 
year 2010.
    It has got to be a particularly skilled person at a GS-12 
or higher, and before any of you have the opportunity to weigh 
in, I hope you understand that these people come with a long-
term obligation to the VA. There is a benefit package that 
extends far past their employment. It is not like you can bring 
them in without something that, for a foreseeable future, does 
not take away from our ability to provide the funding to 
deliver the care.
    So, would anybody like to tackle that one?
    Mr. Blake. Senator Burr, I would start by pointing out for 
basis of comparison that The Independent Budget for general 
administration was significantly less than what the 
Administration recommended.
    From the broader perspective of the IB, we sort of took the 
perspective that we would apply the basics for inflation, which 
still exists out there, and not a lot else in our 
recommendations, health care side notwithstanding, because 
growth in demand is continuing. So it has its own little unique 
perspective.
    But your concerns are not lost on us, and I think our 
recommendations reflect that on some level.
    Senator Burr. Let me add one thing, if anybody else would 
like to chime in on this, in the 2012 budget request VA's 
Office of Information and Technology, which I say up front 
needs some more investment, needs some more personnel, has a 
request for an additional 128 FTEs.
    The VA also indicates that they have plans to hire 705 new 
employees in the coming months, many of these are at levels of 
GS-12 and higher.
    I think you could make the case out of information and 
technology that we are getting into the claims processing. 
Right there you have got 850 new FTEs. These are not claims 
processors. These are looking at the software, the hardware 
needs to try to facilitate the claims.
    I might add to that if anybody would like to comment, I 
just introduced a bill yesterday that I think, Joe, you are 
aware of, maybe all of you are aware of, that provides for any 
veteran that sends in an application, a claim that has all the 
documentation they need, that they get an additional year's 
worth of benefits.
    In other words, an attempt to try to create an incentive so 
that we get claims that are accurate when they come in the door 
so that they go forward with all the information.
    If we screw it up then, we know we have something that we 
can look at that we can try to fix. But from the standpoint of 
the delays, waiting for all of the information that they have 
got to have to give the veterans the benefits.
    Fully develop these claims. Do not bring them in until they 
are fully developed and we will give you the benefit of an 
extra year's benefits.
    Tell me what you think of that. Joe, I will put you on the 
spot.
    Mr. Violante. I have not read the language of the bill. I 
saw the information that you introduced a bill. I mean, it has 
been something that DAV and I think the other organizations 
here have talked about.
    Veterans are put at a disadvantage to begin a fully-
developed claim if they are not allowed to protect that earlier 
effective date.
    From the sounds of the language of your bill, I mean, it 
would make that an incentive to wait that extra time to gather 
all your information, which then makes it easier for the VA.
    Senator Burr. Anybody got any other comments on any of 
this?
    Mr. Violante. I do. I agree with you also. As Carl said, we 
do not have the ability to peek behind the curtain as much as 
we would like to at VA. Yesterday, DAV's national commander 
testified before the Joint Committees and basically called on 
these Committees to do some more oversight of VA.
    In talking to Secretary Shinseki, I know that he would like 
to know--it is a big bureaucratic agency--what is going on. He 
said before that he cannot fix the problem until he knows about 
it.
    So I would like to encourage the Committee to do more 
oversight, to look at some of the situations where they are 
adding personnel that are not really helping the hands-on 
services, either on the health care side or on the benefits 
side, to ensure that these claims and services are provided as 
quickly as possible.
    Senator Burr. Joe, I have said this to the Secretary, from 
the stand point of me personally, so this is not a shot at the 
Secretary or any of his professional staff. I believe that they 
are all multi-talented and passionate about the job that they 
do. I think there is tremendous pressure from you, and from the 
Congress to fix things that are not always easy to fix.
    I would hate to be in Dr. Petzel's position where he is the 
most liked guy if you've got something on his list. But it is 
not always something he can bump up to number 1 or this year or 
next year from the standpoint of funding.
    Quite frankly, it has got to be frustrating for all of them 
to walk in and have the task of building an IT system, of 
having the task of fixing somebody else's problem that they 
left where some of the opportunities were not fully developed.
    But that realization is why we are all here, to hold each 
other accountable to make the best decisions that we can. So, I 
think it is important that we call into question increases like 
this if, in fact, they do not pass the smell test; what is the 
outcome, and will it benefits us? I hope VA will take that 
back.
    Anybody else?
    Ms. Roof. The longer I sit here the more I think about it; 
and you brought up the FTEs. Something you had said earlier is 
you asked the VA what money was appropriated for women's 
programs and then again someone asked why is so much of what we 
appropriated for the caregivers bill, why is that not all being 
used.
    So those are the questions that pop into my mind. If there 
is money for things like speech writers and some of the 
positions you are talking about, something seems off there.
    I do not have all the facts. That would be a conversation I 
would have, to sit and talk to VA directly, but those are the 
kind of things that bother us as a veterans' service 
organizations.
    Dr. Hooker. I can tell you from the clinical perspective 
that all those increases in positions come out of our hides. 
They do not come down to the facility level; we are shorted and 
then it is a question of robbing Peter to pay Paul.
    So then the initiative is, say, polytrauma. Staff goes in, 
and then the next new initiative is women's health. So, staff 
comes out of polytrauma and goes into women's health. It is a 
constant shifting to meet what the latest performance measure 
is with no real addition to staff at the lower levels.
    Mr. Tetz. Senator, I would say that the American Legion 
agrees with many of the counterparts here in the fact that, 
one, we do not have the open veil that we would like to have 
and be able to say truly what is there.
    So we cannot get in the trenches and fight that and say 
absolutely 100 percent we agree with it. But, ultimately, at 
the end of the day what we should ask ourselves, whether we are 
a VA employee or a VSO, is this: has that employee, that team 
member who is at a hospital, a VBA center processing claims, 
what did they do for a veteran today?
    If they did not have direction action, direct help with a 
veteran, then truly we need that person to join the team; and 
that is the question we must ask ourselves.
    Senator Burr. I thank all of you. The Chairman has been 
awfully kind for letting me go over. I think this is a vital 
area; and we have the discretionary spending side even tighter 
next year. The question is, where does it come from?
    My fear is that it would address even further the concern 
that Dr. Hooker has on the clinical side and eventually we find 
ourselves not talking about disability claims, we find 
ourselves talking about things we discussed two decades ago.
    I thank you, Madam Chairman.
    Chairman Murray. Thank you very much, Senator.
    I want to thank all of our witnesses for appearing before 
the Committee today, especially the VA folks who stayed for our 
second panel. I appreciate your sitting here so long.
    The President's Budget is a good place for us to start our 
work this year. We have got work to do on research, 
construction, the IG office, and a number of areas that we have 
talked about today.
    This hearing will really help the Committee form its 
opinion of the Administration's request as we offer our views 
and estimates to the Budget Committee later this month.
     I appreciate everybody's participation.
    Thank you very much. This hearing is now adjourned.
    [Whereupon, at 1:14 p.m., the Committee was adjourned.]
      

                                  
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