[Senate Hearing 114-788]
[From the U.S. Government Publishing Office]
S. Hrg. 114-788
MILITARY CONSTRUCTION, VETERANS AFFAIRS, AND RELATED AGENCIES
APPROPRIATIONS FOR FISCAL YEAR 2017
=======================================================================
HEARINGS
before a
SUBCOMMITTEE OF THE
COMMITTEE ON APPROPRIATIONS UNITED STATES SENATE
ONE HUNDRED FOURTEENTH CONGRESS
SECOND SESSION
on
H.R. 4974/S. 2806
MAKING APPROPRIATIONS FOR MILITARY CONSTRUCTION, THE DEPARTMENT OF
VETERANS AFFAIRS, AND RELATED AGENCIES FOR THE FISCAL YEAR ENDING
SEPTEMBER 30, 2017, AND FOR OTHER PURPOSES
__________
Department of Defense
Office of the Secretary of Defense
Department of the Air Force
Department of the Army
Department of the Navy
Department of Veterans Affairs
Veterans Benefits Administration
Veterans Health Administration
Government Accountability Office
__________
Printed for the use of the Committee on Appropriations
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
Available via the World Wide Web: http://www.gpo.gov/fdsys/browse/
committee.action?chamber=senate&committee=appropriations
__________
U.S. GOVERNMENT PUBLISHING OFFICE
98-769 PDF WASHINGTON : 2018
COMMITTEE ON APPROPRIATIONS
THAD COCHRAN, Mississippi, Chairman
MITCH McCONNELL, Kentucky BARBARA A. MIKULSKI, Maryland,
RICHARD C. SHELBY, Alabama Vice Chairwoman
LAMAR ALEXANDER, Tennessee PATRICK J. LEAHY, Vermont
SUSAN M. COLLINS, Maine PATTY MURRAY, Washington
LISA MURKOWSKI, Alaska DIANNE FEINSTEIN, California
LINDSEY GRAHAM, South Carolina RICHARD J. DURBIN, Illinois
MARK KIRK, Illinois JACK REED, Rhode Island
ROY BLUNT, Missouri JON TESTER, Montana
JERRY MORAN, Kansas TOM UDALL, New Mexico
JOHN HOEVEN, North Dakota JEANNE SHAHEEN, New Hampshire
JOHN BOOZMAN, Arkansas JEFF MERKLEY, Oregon
SHELLEY MOORE CAPITO, West Virginia CHRISTOPHER A. COONS, Delaware
BILL CASSIDY, Louisiana BRIAN SCHATZ, Hawaii
JAMES LANKFORD, Oklahoma TAMMY BALDWIN, Wisconsin
STEVE DAINES, Montana CHRIS MURPHY, Connecticut
Bruce Evans, Staff Director
Charles E. Kieffer, Minority Staff Director
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Subcommittee on Military Construction, Veterans Affairs, and Related
Agencies
MARK KIRK, Illinois, Chairman
MITCH McCONNELL, Kentucky JON TESTER, Montana, Ranking
LISA MURKOWSKI, Alaska Member
JOHN HOEVEN, North Dakota PATTY MURRAY, Washington
SUSAN M. COLLINS, Maine JACK REED, Rhode Island
JOHN BOOZMAN, Arkansas TOM UDALL, New Mexico
SHELLEY MOORE CAPITO, West Virginia BRIAN SCHATZ, Hawaii
BILL CASSIDY, Louisiana TAMMY BALDWIN, Wisconsin
THAD COCHRAN, Mississippi (ex CHRIS MURPHY, Connecticut
officio) BARBARA A. MIKULSKI, Maryland
(ex officio)
Professional Staff
Bob Henke
D'Ann Lettieri
Patrick Magnuson
Christina Evans (Minority)
Chad C. Schulken (Minority)
Michael Bain (Minority)
Administrative Support
Carlos Elias
Samantha Nelson (Minority)
C O N T E N T S
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hearings
Thursday, March 3, 2016
Page
Department of Veterans Affairs:
Veterans Benefits Administration............................. 8
Veterans Health Administration............................... 1
Thursday, March 10, 2016
Department of Veterans Affairs................................... 47
Thursday, April 7, 2016
Department of Defense:
Department of the Air Force.................................. 143
Department of the Army....................................... 130
Department of the Navy....................................... 136
Office of the Secretary of Defense........................... 115
Wednesday, July 13, 2016
Department of Defense............................................ 196
Department of Veterans Affairs................................... 177
Government Accountability Office................................. 188
Statements of Nondepartmental Witnesses
Nondepartmental Witnesses........................................ 221
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back matter
List of Witnesses, Communications, and Prepared Statements....... 225
Nondepartmental Witnesses........................................ 221
Subject Index:
Department of Defense:
Office of the Secretary of Defense....................... 227
Department of the:
Air Force................................................ 227
Army..................................................... 228
Navy..................................................... 228
Department of Veterans Affairs............................... 228
Government Accountability Office............................. 230
Veterans:
Benefits Administration.................................. 230
Health Administration.................................... 230
MILITARY CONSTRUCTION, VETERANS AFFAIRS, AND RELATED AGENCIES
APPROPRIATIONS FOR FISCAL YEAR 2017
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THURSDAY, MARCH 3, 2016
U.S. Senate,
Subcommittee of the Committee on Appropriations,
Washington, DC.
The subcommittee met at 10:55 a.m., in room SD-124, Dirksen
Senate Office Building, Hon. Mark Kirk (chairman) presiding.
Present: Senators Kirk, Murkowski, Boozman, Capito,
Cassidy, Tester, Murray, Udall, Schatz, Baldwin, and Murphy.
DEPARTMENT OF VETERANS AFFAIRS
Veterans Health Administration
STATEMENT OF HON. DAVID J. SHULKIN, MD, UNDER SECRETARY
FOR HEALTH
ACCOMPANIED BY MARK YOW, CHIEF FINANCIAL OFFICER
opening statement of senator mark kirk
Senator Kirk. The subcommittee is holding a hearing today
to review the 2017 budget request. The President's request is
for $78 billion for funding the Department of Veterans Affairs
(VA), an increase of 4.9 percent. About $68 billion of that, 87
percent, is for veterans' medical care.
This subcommittee and this Congress have given all of the
funding that you have requested and more. The answer to every
VA problem is not just more money and not just give us
flexibility. We need to talk about the VA's culture of
corruption with results and talk about performance. We need to
talk about accountability and putting veterans first, not
bureaucrats.
First, a few housekeeping items. We will follow the early
bird rule, alternating sides, majority and minority, to defer
opening statements, and do 5-minute rounds of questions. And we
will do a second round if needed.
Let me now recognize my friend, the man representing the
entire Big Sandy metroplex in Montana.
statement of senator jon tester
Senator Tester. Thank you, Mr. Chairman, and a metroplex it
is. I want to thank all of you for being here today in front of
the appropriations subcommittee, VA military construction
(MILCON), and I want to thank you for your service to this
country's veterans. You have difficult jobs, and I appreciate
the work that you do. In many ways, both the Veterans Health
Administration (VHA) and the Veterans Benefit Administration
(VBA) have made some significant progress over the past year,
but I am sure that you would agree that we have much more work
to do.
The intent of the Choice Act was to give veterans more
opportunity to seek timely care in their communities, but as we
all know, in practice it simply has not happened. Some of the
fault lies with the VA. Some of the fault lies with us in
Congress. And at least in my opinion, much of that fault, which
we have to bear the responsibility for, bears with a third-
party administrator, at least it does in the State of Montana.
Veterans in places like Butte continue to be frustrated by
the time and hassle it takes to schedule appointments through
Choice, and that is directly related to the third-party
administrator. Community providers in places like Billings
continue to be frustrated by the time it takes to get
authorization and reimbursement for care. As a result, the
largest healthcare provider in my State of Montana will not
participate in Choice, and that is because of that third-party
administrator.
VA employees continue to be frustrated because they have to
go through a middleman, the third-party administrator, to
connect veterans with the care that they need. And I have heard
these frustrations directly from Montanans, and their
frustration, along with mine, is not getting less. It is
getting greater each day.
Dr. Shulkin, we have had conversations about this. They are
the same conversations that I have had with Secretary McDonald
multiple times over the past weeks. Yes, fixing the VA, making
sure that we provide the benefits to our veterans does require
some resources, and that is what we are here today to discuss,
your budget.
But it also requires using all the tools that are available
to you in a more effective way. If you do not have the tools
that you need, we need to know about it because if you are not
effectively using the tools you have because of a problem we
have created, we need to fix it. Today I want to hear more
about the budgetary needs of the VA, but I also want to hear
about how the VA is going to make more effective use of the
tools that you already have at your disposal.
Again, I want to thank all of you for being here today. I
look forward to this discussion. And, Mr. Chairman, I
appreciate your work on this subcommittee. Thank you.
Senator Kirk. I would like to welcome our witnesses. David
Shulkin is the Under Secretary for Health. Mr. Shulkin--Dr.
Shulkin--I will give you a chance for first testimony, and we
welcome you now.
summary statement of hon. dr. david j. shulkin
Dr. Shulkin. Thank you. Good morning, Chairman Kirk,
Ranking Member Tester. Thank you for this opportunity to appear
before you to discuss the Veterans Health Administration's
fiscal year 2017 and 2018 medical care appropriations budget
request. I am accompanied today to my right by Mark Yow, who is
our Chief Financial Officer.
Last year in 2015 it was a very big year for addressing
some of the critical issues that we have before us in VHA. The
Department is working hard to rebuild trust with veterans and
the American people, improving service delivery, setting the
long-term course for VA excellence and reform, while delivering
better access to care and benefits. This includes the
Department's MyVA initiative, which reorients VA around the
veterans' needs and empowers employees to assist them in
developing excellent customer service to improve the veteran
experience.
As we enter into 2016, all of us in the VA healthcare
system will be focused on the MyVA initiative, as well as VHA's
Blueprint for Excellence. The Blueprint is aligned with the
Department's strategic plan and supports the MyVA initiative.
The Blueprint for Excellence will serve as a guide in all of
the programs I mentioned in my written testimony. I am
confident that the deep sense of mission we carry through the
next year and any challenges that we may face will be addressed
by this.
VHA's 2017 budget request will support VA's goals to expand
access to timely, high-quality healthcare, and to continue to
transform the Department through its MyVA initiatives. Through
the fiscal year 2017 budget, we will continue to develop and
expand our mental healthcare system with the goal to reduce
veteran suicides. We are committed to increasing access to care
for veterans and focus our efforts on addressing veterans who
have the most significant health needs first.
We have placed a special emphasis on telehealth services
for those in rural and remote locations, and for areas that
have a shortage of specific healthcare professionals, such as
psychiatrists. This past weekend, in fact, VHA held its second
system-wide access stand down where every medical center across
the country this past Saturday was working hard to reduce the
wait times for veterans who were waiting for care.
To address the growing number of women veterans, VA is
strategically enhancing the services and access for female
veterans. Another high priority is ensuring that all enrolled
veterans who require treatment for hepatitis C have access to
the necessary therapies. VA is also dedicated to promoting the
health and well-being of Caregivers. It is important to know
that this budget allows us to continue our commitment to
innovative and cutting-edge medical research that is focused on
improving veteran health outcomes.
I want to highlight our Million Veteran Program and
research in precision medicine that will allow VA to remain a
leader in advancing discoveries to improve healthcare for all
Americans.
The cost of fulfilling this care and other obligations to
our veterans grows, and we expect it will continue to grow for
the foreseeable future. We know that services and benefits for
veterans do not peak until roughly 4 decades after a conflict
ends. Therefore, more resources will be required to ensure that
VA can provide timely, high-quality healthcare into the future.
We know that we have much work to do in fixing access
issues for veterans, and filling our critical leadership and
healthcare professional openings, and ensuring our new Veterans
Choice Plan works better for veterans than it has over the past
year. I came to VA approximately 8 months ago from the private
sector to fix these problems, and I am building a leadership
team that is now committed to doing this and implementing
sustainable change. The fiscal year 2017 budget requests
additional resources which are critical to providing veterans
the care they have earned through their service and sacrifice.
In conclusion, I appreciate the hard work and dedication of
VA employees, our partners from veteran service organizations
who are important advocates for veterans, our community
stakeholders, and our dedicated VA volunteers. I respect the
important role that Congress has in ensuring veterans receive
quality healthcare and benefits that they rightly deserve. I
look forward to continuing our strong collaboration and
partnership with the subcommittee, and other committees of
jurisdiction, and the entire Congress as we work together to
continue to enhance the delivery of healthcare to our Nation's
veterans.
Mr. Chairman, members of the subcommittee, this concludes
my remarks. Thank you again for this opportunity to testify. My
colleagues and I will be happy to respond to any questions from
you and members of the subcommittee. Thank you.
[The statement follows:]
Prepared Statement of Hon. David J. Shulkin, M.D.
Good morning Chairman Kirk, Ranking Member Tester, and members of
the subcommittee. Thank you for the opportunity to appear before you to
discuss the Department of Veterans Affairs (VA) Veterans Health
Administration (VHA) fiscal year 2017 and fiscal year 2018 Medical Care
Advance Appropriations budget request. I am accompanied today by Mark
Yow, VHA's Chief Financial Officer.
The year 2015 was a big year in addressing some of the critical
issues that we have before us in VHA. VA, as a whole, is working to
rebuild trust with veterans and the American people, improve service
delivery, and set the course for long-term VA excellence and reform.
This initiative is called ``MyVA.'' As we enter 2016, all of us in the
VA healthcare system are focused on the ``MyVA'' initiative as well as
VHA's Blueprint for Excellence. The Blueprint is aligned with the
Department's Strategic Plan and supports the ``MyVA'' initiative. The
Blueprint lays out themes and supporting strategies for transformation
to improve the performance of VA healthcare now--making it not only
more veteran-centric, but also veteran-driven by putting our customers
in control of their VA experience. The Blueprint for Excellence will
serve as a guide in all of the programs I mention throughout my
testimony.
To ensure that we remain aligned with ``MyVA'' and the Blueprint
for Excellence, I have five priorities that are the focus of VHA.
First, we must fix the access issues and continue to work on reducing
the wait time for veterans who need our services. Second, VHA must be a
model for high-performance care and develop a high-performance network.
Third, we must improve staff and employee morale and make VA a place
where all of our employees feel comfortable and supported in an
environment that allows them to do the best job to serve our veterans.
Fourth, to ensure consistency of best practices and resource
prioritization, we must share promising practices among facilities and
focus on the things that we know are working best within VA. Finally,
and most important, VHA must restore the trust and confidence that the
American public and veterans have in the services that we provide.
The President's fiscal year 2017 budget request will support VA's
goals to expand access to timely, high-quality healthcare; sustain
funding to support programs dedicated to ending homelessness among
veterans; and continue to transform the Department through its ``MyVA''
initiative, which reorients VA around veteran needs and empowers
employees to assist them by delivering excellent customer service to
improve the veteran experience.
The cost of fulfilling this care and other obligations to our
veterans grows, and we expect it will continue to grow for the
foreseeable future. We know that services and benefits for veterans do
not peak until roughly four decades after a conflict ends. Therefore,
more resources will be required to ensure that VA can provide timely,
high-quality healthcare into the future. The fiscal year 2017 budget
requests additional resources, which are critical in providing veterans
the care that they have earned through their service and sacrifice.
improved access to care
VA is taking multiple steps to expand capacity at our facilities by
focusing on staffing, space, productivity, and VA Community Care. The
fiscal year 2017 budget request provides $65 billion for VA medical
care, a 6.3-percent increase above the 2016 enacted level. The increase
in 2017 is driven by veterans' demand for VA healthcare as a result of
demographic factors, economic assumptions, investments in access, high-
priority investments for Caregivers, and new hepatitis C treatments.
Building on momentum generated by the November 14, 2016, Stand
Down, VA is continuing efforts to improve access to care, improve the
veteran experience, and improve the VA employee experience by
maximizing accessibility to outpatient services and initiating a second
Stand Down held on February 27, 2016. We are re-focusing people, tools,
and systems as we embark on a continuous improvement journey towards
same day access for primary care and urgent specialty care.
We are empowering each VA facility to focus on the needs of its
specific population under the aforementioned guiding principles.
Clinical operations will meet customer demand through resource-neutral,
continuous improvements at the facility level and scaling-up excellence
across the enterprise.
VA has placed special emphasis on increasing access for veterans in
rural and remote locations. Telehealth services are mission-critical to
the future of VA care to veterans. Telehealth utilizes information and
telecommunication technologies to provide healthcare services when the
patient and practitioner are separated by geographical distance. The
fiscal year 2017 budget requests $1.2 billion, an increase of $56
million (5.1 percent) above the 2016 enacted level for telemedicine.
The number of veterans receiving care via VHA's telehealth services
grew approximately 5 percent in fiscal year 2015, and is anticipated to
grow by approximately 6 percent in fiscal year 2016. In fiscal year
2015, during more than 2.1 million telehealth episodes of care, VHA
provided care to more than 677,000 veterans via the three telehealth
modalities (i.e., Clinical Video Telehealth, Home Telehealth and Store
and Forward Telehealth). Forty-five percent of these veterans lived in
rural areas, and otherwise may have had limited access to VA
healthcare.
We are appreciative of Congress' support to improve access as we
build capacity within the VA system to better serve veterans who rely
on us for healthcare. My testimony will now discuss key initiatives
highlighted in the President's 2017 budget request.
mental health care (suicide prevention--a call to action)
Long deployments and intense combat conditions require
comprehensive support for the emotional and mental health needs of
veterans and their families. Accordingly, VA continues to develop and
expand its mental health system. VA has integrated mental health
services into primary care in the Patient Aligned Care Team model.
Providing mental healthcare within the primary care clinic minimizes
barriers that may discourage veterans from seeking mental healthcare.
This integrated healthcare is not seen in other healthcare systems
nationally.
VA has many entry points for mental healthcare, including 167
medical centers, 1,035 Community-Based Outpatient Clinics and
Outpatient Services sites, 300 Vet Centers providing readjustment
counseling, 80 Mobile Vet Centers, a national Veterans Crisis Line, VA
staff on college and university campuses, and a variety of other
outreach efforts.
VA's Primary Care-Mental Health Integration (PC-MHI) program, which
provides mental healthcare as a routine component of primary care, is
now established in 98.8 percent of VHA divisions, 98.5 percent of the
very large and 81.2 percent of large community based outpatient
clinics. VHA provided over 1 million PC-MHI encounters in 2015, an
increase of 8 percent from 2014 and an increase of 28 percent from
2013.
The fiscal year 2017 budget requests $7.8 billion, an increase of
$347 million (4.6 percent), to ensure the availability of a range of
mental health services, from treatment of common mental health
conditions in primary care to more intensive interventions in specialty
mental health programs for more severe and persisting mental health
conditions. We will continue to focus on expanding and transforming
mental health services for veterans to ensure that accessible and
patient-centered care, including treatment for posttraumatic stress
disorder (PTSD), ensuring timely access to mental healthcare, and
treatment for military sexual trauma.
On February 2, 2016, Secretary Robert McDonald and I held a
groundbreaking event ``Preventing Veteran Suicide: A Call to Action.''
This day-long summit was attended by over 230 participants, including
members of Congress, the Department of Defense, other Federal partners,
veterans, their family members, Veterans Service Organizations,
academics, and other stakeholders. The primary goal of the event was to
develop a concrete plan of action to engage more veterans at risk for
suicide by bringing them into VA's system. Independent studies have
shown that veterans who engage in VA care are at lower risk of suicide
than those who do not engage in VA care. VA continues to develop a
proactive action plan with steps to move forward with suicide-
prevention efforts based on the feedback and presentations of the
summit.
VA is committed to ensuring the safety of our veterans, especially
when they are in crisis. Our suicide prevention program is based on
enhancing veterans' access to high-quality mental healthcare and
programs specifically designed to help prevent veteran suicide. Losing
one veteran to suicide shatters an entire world. Veterans who reach out
for help must receive that help when and where they need it and in
terms that they value.
hepatitis c virus
VA places a high priority on ensuring that all enrolled veterans
who require treatment for the hepatitis C virus (HCV) have access to
the necessary therapies. Chronic infection with HCV is the most common
blood-borne infection in the world and is a major public health problem
facing not only veterans, but the United States in general. The fiscal
year 2017 budget requests $1.5 billion to capitalize on the
availability of new therapies to improve access to and quality of HCV
care. These new drugs will save veterans' lives. During fiscal year
2015, VA medical facilities treated over 30,000 veterans for HCV with
these new drugs with remarkable success, achieving cure rates of 90
percent.
care in the community
VA is committed to providing veterans access to timely, high-
quality healthcare. The 2017 budget includes $12.3 billion for Care in
the Community and includes a new Medical Care in the Community budget
account, as mandated in the VA Budget and Choice Improvement Act
(Public Law 114-41). Of the total, $7.2 billion will be provided
through a transfer of the 2017 advance appropriations for Medical
Services to the new budget account, $250 million will be provided
through anticipated collections in the new account, and $4.8 billion
will be provided through the Veterans Choice Program. The 2017 budget
will support over 15.6 million visits/procedures for veterans by non-VA
providers.
On October 30, 2015, VA provided Congress with its plan for the
consolidation and improvement of all purchased care programs into one
New Veterans Choice Program (New VCP).
In today's complex and rapidly changing healthcare environment
where VA is experiencing a steep increase in demand for care, it is
essential for VA to work with providers in communities across the
country to meet veterans' needs. To be effective, these relationships
must be principle-based, streamlined, and easy to navigate for
veterans, community providers, and VA employees.
caregiver support program
VHA recognizes the crucial role that family caregivers play. These
individuals are central to our mission in caring for those who have
``borne the battle.'' They are partners in helping veterans as they
recover from injury and illness, in supporting veterans in their daily
lives in their communities, and in helping veterans remain at home. VHA
is dedicated to providing caregivers with the support and services they
need.
The fiscal year 2017 budget requests $725 million for the National
Caregivers Support Program to support nearly 36,600 Caregivers, an
increase of $102 million (16.4 percent) from fiscal year 2016, of which
$629 million in 2017 will be for the monthly stipends paid to
designated primary family caregivers under VA's Program of
Comprehensive Assistance for Family Caregivers, an increase of $140
million (29 percent) from fiscal year 2016. The increases to the
stipend obligations are due to an increase in the number of caregivers
approved to participate in the Program of Comprehensive Assistance as
well as the increases in the underlying hourly wages used to calculate
the monthly stipend rates.
In addition to the Program of Comprehensive Assistance for Family
Caregivers, VA offers a variety of services and resources through the
General Caregiver Support Program, including: local Caregiver Support
Coordinators, the National Caregiver Support Line staffed by licensed
social workers, the VA Web site dedicated to family caregivers, as well
as the Peer Support Mentoring Program. Additionally, VA offers a
variety of training and provides many educational opportunities for
caregivers of veterans. VA is dedicated to promoting the health and
well-being of caregivers who care for our Nation's veterans, through
education, resources, support, and services.
ending veterans homelessness
Ending and preventing veteran homelessness is now becoming a
reality in many communities. Between 2010 and 2015, overall veteran
homelessness dropped by 36 percent, as measured by the yearly Point-in-
Time count, and we have achieved a nearly 50-percent decrease in
unsheltered veteran homelessness. Through unprecedented partnerships
with Federal and local partners, we have greatly increased access to
permanent housing, a full range of healthcare including primary care,
specialty care, and mental healthcare; employment; and benefits for
homeless and at risk for homeless veterans and their families. As a
result of these investments, in fiscal year 2015 alone, VA provided
services to more than 365,000 homeless or at-risk veterans in VHA's
homeless programs. Nearly 65,000 veterans obtained permanent housing
through VHA Homeless Programs interventions, and more than 36,000
veterans and their family members, including 6,555 children, were
prevented from becoming homeless.
In fiscal year 2017, VA will continue to focus on prevention and
treatment services. The fiscal year 2017 budget request of $1.6 billion
will support programs such as Grant and Per Diem, Veterans Justice
Outreach, Supportive Services for Veteran Families and case management
services for the Department of Housing and Urban Development-VA
Supportive Housing program. All of these programs will continue to work
towards achieving a systematic end to homelessness, meaning that there
are no veterans sleeping on our streets and every veteran has access to
permanent housing.
advances in medical and prosthetic research
For over 75 years, VA Research has produced innovative and cutting-
edge medical and prosthetic advances that are broad and significant. VA
research is focused on the U.S. veteran population, and allows VA
research to uniquely address scientific questions to improve veterans
healthcare. Most VA researchers are also clinicians and healthcare
providers who treat patients. Thus, VA research arises from the desire
to heal rather than pure scientific curiosity, and yields remarkable
returns.
In 2017, Medical Research will be supported through a $663 million
direct appropriation, and an additional $1.2 billion from VA's medical
care program and other Federal and non-Federal grants. Total funding
for Medical and Prosthetic Research will be over $1.9 billion in 2017.
The 2017 budget submission emphasizes transformational elements
emanating from VA research and incorporating the evolving science of
Genomic Medicine--how genes affect health--to support Precision
Medicine innovations. This budget directly supports the President's
initiative to invest in Precision Medicine to drive personalized
medical treatment.
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
Beyond VA's support of over 2,200 ongoing research projects, VA
will leverage our Million Veteran Program (MVP)--already one of the
world's largest databases of genetic information--to support several
Precision Medicine Initiatives. The first initiative will evaluate
whether using a patient's genetic makeup to inform medication selection
is effective in reducing complications and getting patients the most
effective medication. This initiative will focus on up to 21,500
veterans with PTSD, depression, pain, and/or substance abuse.
The second initiative will focus on additional analysis of
Deoxyribonucleic acid (DNA) specimens already collected in the Million
Veteran Program. More than 438,000 veteran volunteers have contributed
DNA samples so far. Genomic analysis on these DNA specimens allows
researchers to extract critical genetic information from these
specimens. There are several possible ``levels'' of genomic analyses,
with increasing cost. Built into the design of MVP and currently funded
within VA's research program is a process known as ``exome chip''
genotyping--the tip of the iceberg in genomic analysis. Exome chip
genotyping provides useful information, but newer technologies promise
significantly greater information for improving treatments.
VA proposes conducting the next level of analysis, known as ``exome
sequencing'' on up to 100,000 veterans who are enrolled in MVP. This
exome sequencing analyzes the part of the genome that codes for
proteins--the large, complex molecules that perform most critical
functions in the body. Sequencing efforts will begin with a focus on
veterans with PTSD and frequently co-occurring conditions, such as
depression, pain, and substance abuse, and expand to other chronic
illnesses such as diabetes and heart disease, among others. This more
detailed genetic analysis will provide greater information on the
biological factors that may cause or increase the risk for these
illnesses.
conclusion
In conclusion, VA is committed to providing the highest quality
care, which our veterans have earned and deserve. I appreciate the hard
work and dedication of VA employees, our partners from Veterans Service
Organizations--that are our important advocates for veterans--our
community stakeholders, and our dedicated VA volunteers. I respect the
important role that Congress has in ensuring that veterans receive the
quality healthcare and benefits that they rightfully deserve. I look
forward to continuing our strong collaboration and partnership with
this subcommittee, our other committees of jurisdiction, and the entire
Congress, as we work together to continue to enhance the delivery of
healthcare services to our Nation's veterans.
Mr. Chairman, members of the subcommittee, this concludes my
remarks. Thank you again for the opportunity to testify. My colleague
and I will be happy to respond to any questions from you or other
members of the subcommittee.
Senator Kirk. Thank you. And, Mr. Pummill, after 30 years
of service in the Army infantry, I will say--I want to say that
you now should be addressed as Colonel Pummill.
Veterans Benefits Administration
STATEMENT OF DANNY G.I. PUMMILL (RET.), ACTING UNDER
SECRETARY FOR BENEFITS
ACCOMPANIED BY JAMIE MANKER, CHIEF FINANCIAL OFFICER
Mr. Pummill. Thank you, Chairman Kirk. Chairman Kirk,
Ranking Member Tester, and members of the subcommittee, thank
you for the opportunity to present VBA's 2017 budget request. I
am accompanied today by Jamie Manker, our Chief Financial
Officer. I am going to pose all the real tough questions to
him.
Our 2017 budget request includes $2.8 billion in
discretionary funds and $103.6 billion in mandatory funds,
reflecting the ever-growing demand for VA benefits and
services. The budget also requests a 2018 advanced
appropriation of $103.9 billion for VBA's three mandatory
appropriations, including compensation and pensions,
readjustment benefits, and insurance indemnities.
The demand for benefits and services for veterans of all
eras continues to increase and will continue to increase
decades after conflicts end. For the past 15 years, the
percentage of the veteran population receiving disability
compensation has increased to 20 percent from 8.5 percent where
it had remained steady for the past 40 years.
The average disability rating has also increased. For 45
years, the average disability rating degree of disability held
steady at 30 percent, but since 2000 that has risen to 49
percent. Despite these challenges, VBA has made major strides
in increasing productivity and reducing the claims backlog.
As a direct result of our transformation initiatives, we
have reduced the pending disability claims inventory by 60
percent and the claims backlog by 87 percent. In making this
progress, we also ensured that quality was not compromised. We
have increased claim-based accuracy from 83 percent to 90
percent, and issue-based accuracy has improved to 96 percent.
Veterans are waiting less time for decisions and benefits. The
average time to decide a claim has improved by 90 days from
fiscal year 2014, and the average age of a pending claim has
improved by 188 days.
VBA is also working to further improve services to veterans
in alignment with the Secretary's MyVA vision to become the
number one customer service agency in the Federal Government.
We are focused on improving veterans' experiences in the
compensation and examination process as one of the Secretary's
MyVA breakthrough priorities to help veterans better the exam
process as it relates to their claims and enhanced procedures
for exam scheduling. We are working on another MyVA
breakthrough initiative to simplify and streamline the appeals
process so veterans can receive their final decision on an
appeal within 365 days from filing.
This budget supports this simplified appeals process which
also requires Congress's continued support through legislative
action. Our budget request includes funding for technology
investments and other initiatives necessary to provide
veterans, their families, and survivors with the benefits and
services they earned and deserve. By moving to a paperless
electronic claims processing system, VBA increased claim and
medical issue productivity, which helped mitigate the effects
of a 131-percent increase in workload between 2009 and 2015.
The transformation from a paper intensive process to a full
electronic processing system resulted in VA completing a record
breaking 1.4 million disability compensation pension claims for
veterans and their survivors.
Our technological advancements will expand and enhance
existing services, and will also focus on delivering key
functionality that enables quicker, more accurate and
integrated claims processing. As VBA continues to receive and
complete more rating claims, the volume of appeals, non-rated
claims, and fiduciary exams correspondingly increase. To
address this, we are requesting an additional $29.1 million for
300 personnel to process non-rating compensation and pension
claims, as well as an additional $25 million to help meet
veterans' expectations for more timely claim decisions.
We appreciate the opportunity to discuss our budget request
and look forward to working with you to identify and prioritize
spending in the best interest of our veterans, their families,
and survivors, and our Nation. I welcome any questions you and
the subcommittee may have.
[The statement follows:]
Prepared Statement of Danny G. I. Pummill
Chairman Kirk, Ranking Member Tester, and distinguished members of
the Senate Appropriations Committee, Subcommittee on Military
Construction, Veterans Affairs, and Related Agencies: Thank you for the
opportunity to present the President's 2017 budget and 2018 advance
appropriations requests for the Veterans Benefits Administration (VBA).
I am accompanied today by Mr. Jamie Manker, VBA's Chief Financial
Officer.
summary of 2017 budget request
The President's 2017 budget for the Department of Veterans Affairs
(VA) will allow VA to manage the comprehensive array of integrated
benefits and services provided for our Nation's veterans, their
families, and survivors, administered through our nationwide network of
56 regional offices (ROs). The 2017 budget request includes $2.8
billion in discretionary funds and $103.6 billion in mandatory funds
for VBA. The budget also requests 2018 advance appropriations of $103.9
billion for VBA's three mandatory appropriations: compensation and
pensions, readjustment benefits, and insurance and indemnities. With
the resources requested in the 2017 budget, VA will provide:
--Disability compensation for 4.4 million veterans with service-
connected disabilities;
--Dependency and indemnity compensation for 405,000 veterans'
survivors;
--Pension for 297,000 wartime veterans and almost 210,000 of their
survivors;
--Vocational rehabilitation and employment benefits paid for nearly
141,000 disabled veterans;
--Education and training assistance for nearly 1.1 million veterans
and family members;
--Home loan assistance for over 2 million veterans and family members
with active VA loans;
--Fiduciary activities providing estate protection services for
224,000 VA beneficiaries unable to manage their own funds; and
--Life insurance programs for over 6 million veterans,
servicemembers, and their families.
The President's 2017 budget request also includes funding for
technology investments and other initiatives necessary to timely
provide veterans, their families, and survivors with the benefits and
services they earned and deserve.
rising demand for disability benefits
As VBA becomes more productive through our implemented people,
process, and technology initiatives, the demand for benefits and
services from veterans of all eras continues to increase, exceeding our
capacity to meet it. This increased demand is fueled by more than a
decade of war, agent orange-related disability claims, a disjointed and
redundant claim appeal process, demographic shifts, increased medical
issues claimed, and other factors. In addition, VBA is providing
services to an older veteran population with more chronic conditions.
Veterans' benefit requirements continue to increase decades after
conflicts end, which is a fundamental, long-term challenge for VA. Even
though the Vietnam war ended 40 years ago, the number of Vietnam-era
veterans receiving disability compensation has not yet peaked. We
anticipate a similar trend for Gulf war-era veterans, of whom only 26
percent have been awarded disability compensation. For the past 15
years, the percentage of the veteran population receiving disability
compensation increased to 20 percent from 8.5 percent where it had
remained steady for over 40 years. Moreover, the total number of
service-connected disabilities for veterans receiving disability
compensation grew from 11.8 million in 2009 to 19.7 million in 2015, an
increase of more than 67 percent in just 6 years. This dramatic growth,
along with estimates based on historic trends, predicts an even greater
increase in claims for more benefits as veterans' age and disabilities
become more acute.
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Along with the increase in the number of veterans receiving
disability compensation, there has been a significant rise in the
average degree of disability compensation granted to veterans. For 45
years, from 1950 to 1995, the average degree of disability held steady
at 30 percent. But, since 2000, the average degree of disability has
risen to 49 percent. VBA's mandatory request for 2017 is $103.6
billion, twice the amount spent in fiscal year 2009.
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
claims processing transformation
VBA underwent the largest transformation in its history by
modernizing the delivery of VA benefits and services. To achieve VA's
goal of processing all claims within 125 days with improved accuracy,
VBA aggressively implemented its transformation plan--a set of actions
targeted to reorganize and retain its people, streamlined its
processes, and deployed technology--and, as of January 31, 2016, VBA
has achieved the following results:
--VBA is reducing the pending disability claims inventory.
--Peak: 884,000 claims in July 2012.
--Now: 352,554 claims--Improvement: 60 percent.
--Rating accuracy has improved.
--12-month claim-based accuracy increased from 83 percent in 2011
to 90 percent--Improvement: 6 percentage points.
--12-month issue-based accuracy increased from 95 percent in fiscal
year 2013 to 96 percent--Improvement: 1 percentage point.
--Veterans are waiting less time for decisions and benefits.
--The average time to decide a veteran's disability claim was
reduced from 218 days in fiscal year 2014 to 128 days--
Improvement: 90 days.
--The average age of pending disability claims:
-- Peak: 282 days in March 2013.
-- Now: 94 days--Improvement: 188 days.
--Despite the challenges of an increase in disability claims workload
as well as increased complexity of workload, VBA has made major
strides in increasing its productivity.
--The number of claims pending over 125 days and considered part of
the claims backlog has decreased.
--Peak: over 611,000 claims in March 2013.
--As of January 31, 2016: 79,106 claims--Improvement: 87 percent.
myva transformation--meeting veterans' needs
In addition to improving the quality and timeliness of disability
claim decisions through our transformative people, processes, and
technology initiatives, VBA is working to further improve services to
veterans in alignment with the Secretary's MyVA vision: to become the
Number 1 customer-service agency in the Federal Government. We are
putting the needs and interests of veterans and their families foremost
in all that we do.
VBA has realigned its ROs into 5 districts under the MyVA framework
that simplifies internal coordination, facilitates partnering, enhances
customer service, and allows veterans to more easily navigate VA. As
the districts continue to mature, there is increased coordination and
collaboration among VA entities, veterans, community partners, and
stakeholders to transform our agency into a more customer-centric
organization. VA has enabled 36 Community Veterans Engagement Boards, a
national network designed to leverage all community assets, not just VA
assets, to meet local veteran needs. VBA ROs actively participate and
engage with communities and Veterans Service Organizations (VSO) to
focus on identifying solutions for veterans in the local communities
and to establish the foundation for a strong MyVA community.
VA launched the Veterans Economic Communities Initiative (VECI) in
May 2015 to complement the goals of MyVA and VA's Transition Assistance
Program, promoting local collaboration, dialogue, and partnerships
among organizations that serve transitioning servicemembers, veterans,
and their families. Economic liaisons in each VECI community
collaborate and partner with government leaders, businesses, policy
experts, educational institutions, and nonprofit organizations to build
an integrated network of support and resources and to maximize impact
to improve outcomes for veterans and their families. We are expanding
to 25 new VECI communities in early 2016, bringing the total to 50 U.S.
metropolitan statistical areas.
One of VA's MyVA 12 breakthrough priorities is focused on improving
veterans' experiences in the compensation and pension examination
process. We are working to help veterans better understand the exam
process as it relates to their claims. We are enhancing procedures for
examination scheduling to facilitate veterans' direct involvement and
providing training to ensure VA employees understand how their role
directly impacts veterans' experiences and perceptions of VA.
We are also working collaboratively with our partners on the MyVA
breakthrough priority to simplify the appeals process. Our goal is to
provide veterans with a simple, fair, and streamlined appeals procedure
in which they would receive a final appeals decision within 365 days
from the filing of an appeal by fiscal year 2021. This goal would
require Congress' continued support through legislative action and
additional funding. The 2017 budget supports this simplified appeals
process, which is explained in more detail later.
transformation initiatives in the president's 2017 budget request
The MyVA transformation will ensure that VA is a sound steward of
taxpayers' dollars as a result of instituting operational efficiencies,
cost savings, and service innovations to support this and future budget
requests. Few realize that when it comes to the general operating
expense of delivering over $100 billion in benefits to over 5.3 million
veterans and survivors, VBA spends only 3 cents on the dollar. To boost
efficiency and employee productivity, VBA moved to paperless claims
processing from its historically manual, paper-intensive process.
Modernizing to an electronic claims processing system helped VBA
increase claim productivity per claims processor by 25 percent since
2011 and medical issue productivity by 82 percent per claims processor
since 2009. This significant productivity increase helped mitigate the
effects of the 131-percent increase in workload between 2009 and 2015,
when the number of medical issues rose from 2.7 million to 6.4 million.
The President's 2017 budget will allow VBA to continue building on the
success of these initiatives.
Veterans Claims Intake Program (VCIP).--VBA shifted to electronic
claims processing by converting paper files to eFolders through VCIP,
which streamlined processes for receiving digital records and data into
the Veterans Benefits Management System (VBMS) and other VBA systems.
VCIP scans paper claims, converts them into digital format, and
extracts important data for input into electronic folders. VBMS has
also expanded document conversion services to include centralized mail
processing. More than 1.9 billion images have been converted from
paper, and over 99.8 percent of compensation claims are now being
electronically processed in VBMS. In addition to supporting scanning
operations and centralized mail processing, VBA's 2017 request of
$142.9 million will sustain current operations, support future
conversion efforts, and enable the disposition of paper materials.
Centralized Mail Initiative (CMI).--CMI consolidates inbound paper
mail from VA's ROs to a centralized intake site, expands VBA's
capabilities for scanning and conversion of claims evidence, increases
electronic claims processing capabilities; and assists in converting
100 percent of received source materials to an electronic format. VBA
has already deployed centralized inbound mail for all ROs. When coupled
with VBA's contract examination vehicle, this will enable VBA to
improve and enhance the speed and consistency for requesting VA
examinations. The 2017 budget request of $26.7 million provides
resources to sustain operations and expand this initiative to include
in-bound and out-bound mail for all benefits through fiscal year 2020.
Veterans Benefits Management System (VBMS).--VBMS is a Web-based,
paperless claims process solution complemented by improved business
processes. As the cornerstone of VBA's claims transformation strategy,
VBMS serves as enabling technology to provide veterans and their
dependents with timely, high-quality decisions. VBA's shift to
electronic folders in VBMS addressed the inefficiencies of the paper
folders and the problems of misplaced files and records. Through a Web-
based application, multiple, geographically separated users can view
the electronic folders simultaneously, thereby minimizing the need for
sequential processing and eliminating the delays of receipt of paper
folders at ROs. VBMS also provides automation of processes, such as the
receipt of evidence, movement of claims to the next stage, and updates
to the claims status, which means more veterans are receiving faster
decisions. As of January 31, 2016, VBA completed over 4.2 million
rating decisions and processed over 2.4 million claims end-to-end in
VBMS.
Under the VBMS initiative, we will continue to reduce our reliance
on legacy systems with planned improvements to the electronic folder,
such as adding a unique identifier on VA correspondence. When veterans
return information with the identifier, it will automatically upload
the information in the veteran's electronic folder. Both this fiscal
year and in fiscal year 2017, VBMS enhancements will focus on
delivering key functionality that enables quicker, more accurate, and
integrated claims processing while laying the foundation for future,
veteran-centric enterprise business capabilities. These include the
delivery of electronic service treatment records, establishing one
authoritative source for veteran contact information, and collaborating
with the Board of Veterans' Appeals (Board) to define the appeals
functionality needed both at the ROs and as part of the broader appeals
modernization efforts. The 2017 budget request for $37.4 million for
VBA and $143 million for the Office of Information &Technology (OI&T)
provides resources to sustain operations and expand future enhancements
and initiatives.
National Work Queue (NWQ).--In conjunction with VBMS, VBA is
implementing a national workload strategy through NWQ, which will
provide greater flexibility in management of workload and performance
by enabling automated distribution of claims across VBA. NWQ
prioritizes and distributes our claims inventory at a national level
and further standardizes claims processing. NWQ will distribute claims
electronically from a centralized queue based on RO capacity, so that
veterans' claims will be automatically directed across all ROs to
efficiently match claim demand with available expertise and processing
capacity regardless of RO jurisdiction. Generally, the veteran's State
of residence will continue to be the first filter for assigning claims,
thereby increasing the likelihood that the RO in the veteran's State of
residence will process the claim. Veterans are still able to receive
assistance with their claims by visiting their RO for personal
assistance at the public contact sites, going online through eBenefits,
and utilizing VBA's National Call Centers. Veterans, congressional
staff, and VSO representatives will continue to have access to claim
status and information through current venues. The electronic inventory
provides real-time updates, no matter where the claim is assigned for
processing. The 2017 budget request of $3.3 million provides resources
to fully implement the NWQ to all ROs and will expand this initiative
to include electronically routing non-rating claims (claims that in
most cases do not require a rating decision but directly impact
benefits, such as survivors pension, burial claims, dependency claims,
income adjustments, and drill pay adjustments).
new agency priority goal to improve dependency claim processing
As VA continues to improve timeliness of disability claim
decisions, VA is now also focusing on the dependency claims that are
the direct result of the dramatic increase in completed disability
rating decisions and the growth in the number of veterans receiving
compensation at the higher disability evaluation levels (30 percent and
above). VA has established as one of its Agency Priority Goals (APGs)
to reduce the overall inventory of dependency claims to 100,000 and
improve the average days to complete (ADC) dependency claims to 125
days by the end of fiscal year 2017. Our improvement efforts include
expansion of rules-based processing, promotion of online dependency
claim submission, and streamlining of policies and procedures. The new
dependency claims APG represents a 56-percent improvement from the
fiscal year 2015 baseline of 227,000 pending dependency claims, and a
43-percent improvement from the fiscal year 2015 ADC baseline of 221
days.
all vba benefit programs
The transition from a paper-intensive process to a fully electronic
processing system resulted in VA deciding a record-breaking 1.4 million
disability compensation and pension claims for veterans and their
survivors in fiscal year 2015. VBA's success in processing an
unprecedented number of rating claims in recent fiscal years has also
resulted in other unmet workload demands. With increases in rating
claims receipts and completions, the volume of non-rating claims,
fiduciary field examinations, and appeals increases correspondingly. To
address this, VBA requests $2.8 billion for general operating expenses,
an increase of $118.4 million (4.4 percent) over the 2016 enacted
level. These resources will support 22,171 full-time equivalent (FTE)
employees and includes an additional $29.1 million for 300 FTE to
process non-rating compensation and pension claims. In 2015, VA
completed nearly 37-percent more non-rating work than in 2013 and 15-
percent more than in 2014. These additional FTE are needed to reduce
the non-rating claims inventory and provide veterans with more timely
decisions on non-rating claims. To ensure that all aspects of the
claims process are improved for veterans, VBA is also requesting an
additional $25 million to help meet veterans' expectations for more
timely claim decisions, for a total increase of $118.4 million over the
2016 enacted level.
This budget will allow VBA to administer compensation and pension
benefits totaling $86 billion to over 5.3 million veterans and
survivors. It will also enable VA to administer education benefits and
vocational rehabilitation and employment benefits and services to over
1.2 million participants; guarantee more than 429,000 new home loans;
and provide life insurance coverage to 1 million veterans, 2.2 million
servicemembers, and 2.8 million family members.
Insurance.--VBA's insurance program maintains life insurance
programs, giving financial security and peace of mind to
servicemembers, veterans, and their families. In 2017, we anticipate
that our insurance programs will provide $1.2 trillion of insurance
coverage to 2.2 million servicemembers, 1 million veterans, and 2.8
million spouses and children. The 2017 budget request for $35.4
million, of which $879,000 is in the general operating expenses
appropriation and $34.5 million is reimbursable by the Insurance funds,
will support 345 FTE and provide servicemembers and their families with
universally available life insurance, as well as traumatic injury
protection insurance for servicemembers.
Education.--VA's education programs provide education and training
benefits to eligible servicemembers, veterans, and dependents.
Education programs assist them in their readjustment to civilian life
and also help the armed forces with recruitment and retention of
members. In addition, these programs enhance our Nation's economic
competitiveness by developing a more highly educated and productive
workforce. Through the Post-9/11 GI Bill program, as of February 8,
2016, we have issued approximately $60.4 billion in benefits payments
to 1,546,035 individuals and their educational institutions since the
program's inception in August 2009. With the successful automation of
Post-9/11 GI Bill claims, we are currently issuing benefits to the
majority of beneficiaries in an average of 7 days at 99-percent
accuracy. The 2017 budget request is $212.4 million and 1,904 FTE to
continue providing veterans, servicemembers, Reservists, and qualified
family members with such educational resources.
Vocational Rehabilitation and Employment (VR&E).--The VR&E program
provides the services and assistance necessary to enable veterans with
service-connected disabilities to become employable and obtain and
maintain suitable employment, or, to the maximum extent feasible,
achieve independence in daily living. VR&E services include career
vocational counseling, job search assistance, and post-secondary
training for service-disabled veterans. VBA seeks to enhance outreach
and service delivery of education and vocational counseling services.
Counselors from VR&E and Integrated Disability Evaluation System, as
well as contract rehabilitation counselors will provide these
counseling services through the VetSuccess on Campus programs at more
than 94 schools.
Our alignment with the MyVA initiatives and objectives include
investments in the Veterans Employment Center (VEC), which provides
transitioning servicemembers, veterans, and their families with a
single authoritative Internet source that connects them with job
opportunities, and provides tools to translate their military skills
into plain language and build a profile that can be shared--in real
time--with employers. Employers have made commitments to hire over a
million individuals and over 2.2 million private- and public-sector
jobs are listed on the VEC. In addition, our Transition GPS program
helps separating servicemembers prepare for civilian life by providing
benefits briefings and other transition activities. So far, VBA has
provided over 45,000 benefits briefings, career technical training
courses, and support for capstone events to over 550,000 attendees.
(Because servicemembers and their family members can attend more than
one briefing, this count does not represent unique servicemembers). As
previously mentioned, VBA is involved in the MyVA Economic Opportunity
Campaign, which involves the collaboration with public and private
partners in communities across the country to help connect and amplify
available resources and support for veterans and their families.
The VR&E program request is $331.3 million and 1,594 FTE. This
funding will help ensure that VA continues to build pathways to
meaningful career opportunities for veterans by bringing them together
with educators and employers across U.S. cities and communities and
leveraging unique VA and interagency programs and resources to improve
economic outcomes for veterans.
Home Loan Guaranty.--Our request of $170 million and 907 FTE for
the housing program is funded through appropriations to credit accounts
and helps eligible veterans, active duty personnel, surviving spouses,
and members of the Reserve components and National Guard to purchase,
retain, and adapt homes in recognition of their service to the nation.
The 2017 budget includes $34 million for the VA Loan Electronic
Reporting Interface (VALERI) to manage over 2 million VA-guaranteed
loans for veterans and their families. VA uses the VALERI tool to
manage and monitor efforts taken by private-sector loan servicers and
VA staff in providing timely and appropriate loss mitigation assistance
to defaulted borrowers. In addition to supporting the payment of
guaranty and acquisition claims, it connects VA with more than 320,000
veteran borrowers and more than 225,000 mortgage servicer contacts.
Without these resources, approximately 90,000 veterans and their
families would be in jeopardy of losing their homes each year,
potentially costing the Government an additional $2.8 billion per year.
legislation
The 2017 President's budget also proposes legislative actions that
are necessary to ensure that veterans receive timely and quality
delivery of benefits. Designated as one of our MyVA breakthrough
priorities, VA proposes to streamline and modernize the appeals
process.
The current VA appeals process is broken. The more than 80-year-old
process was conceived in a time when medical treatment was far less
frequent than it is today, so it is encumbered by antiquated laws that
have evolved since World War I and steadily accumulated in layers.
Under current law, the VA appeals framework is complex,
ineffective, confusing, and understandably frustrating for veterans who
wait much too long for final resolution of their appeal. The system has
no defined endpoint, and multiple steps are set in statute. The system
requires continuous evidence gathering and multiple re-adjudications of
the very same or similar matter. A veteran, survivor, or other
appellant can submit new evidence or make new arguments at any time,
while VA's duty to assist requires continuous development and re-
adjudication. The VA appeals process is unlike other standard appeals
processes across Federal and judicial systems.
Fundamental legislative reform is essential to ensure that veterans
receive timely and quality appeal decisions, and we must begin an open,
honest dialogue about what it will take for us to provide veterans with
the timely, fair, and streamlined appeals decisions they deserve. To
put the needs, and interests of veterans and beneficiaries first--a
goal on which we can all agree--the appeals process must be modernized.
The 2017 budget proposes a Simplified Appeals process--legislation
and resources (i.e., people, process, and technology) --that would
provide veterans with a simple, fair, and streamlined appeals process
in which they would receive a final decision on their appeal within 1
year from filing the appeal by fiscal year 2021.
Over the last 20 years, appeal rates have continued to hold steady
at between 11 and 12 percent of completed claims. As VBA received and
completed record-breaking numbers of disability rating claims, the
number of appeals correspondingly increased. Between December 2012 and
November 2015, the number of pending appeals rose by 34 percent. Under
current law with no radical change in resources, the number of pending
appeals is projected to soar by 397 percent--from 437,000 to 2.17
million--between November 2015 and fiscal year 2027.
Without legislative change or significant increases in staffing, VA
will face a soaring appeals inventory, and veterans will wait even
longer for a decision on their appeal. If Congress fails to enact VA's
proposed legislation to simplify the appeals process, Congress would
need to provide resources for VA to sustain more than double its
appeals FTE, with approximately 5,100 appeals FTE onboard. The prospect
of such a dramatic increase, while ignoring the need for structural
reform, is not a good result for veterans or taxpayers.
While the Simplified Appeals proposal would require FTE increases
for the first several years to resolve the more than 440,000 currently
pending appeals, by fiscal year 2022, VA would be able to reduce
appeals FTE to a sustainment level of roughly 1,030 FTE (including 980
FTE at the Board and 50 at VBA), a level sufficient to process all
simplified appeals in 1 year. Notably, such a sustainment level is
1,135 FTE less than the current 2016 budget requires, and is 4,070 FTE
less Department-wide than would be required to address this workload
with FTE resources alone.
In 2015, the Board was still adjudicating an appeal that originated
25 years ago, even though the appeal had previously been decided by VA
more than 27 times. Under the Simplified Appeals process, most veterans
would receive a final appeals decision within 1 year of filing an
appeal. Additionally, rather than trying to navigate a multi-step
process that is too complex and too difficult to understand, veterans
would be afforded a transparent, single-step appeals process with only
one entity responsible for processing the appeal. Essentially, under a
Simplified Appeals process, as soon as a veteran files an appeal, the
case would go straight to the Board where a Judge would review the same
record considered by the initial decision-maker and issue a final
decision within 1 year; the veteran would be informed quickly whether
that initial decision was substantially correct, contained an error
that must be corrected, or was simply wrong. There would be a limited
exception allowing the Board to remand appeals to correct duty to
notify and assist errors made on the part of the agency of original
jurisdiction (AOJ) prior to issuance of the initial AOJ decision. If a
veteran disagrees with any or all of the final appeals decision, the
veteran always has the option of pursuing an appeal to the Court of
Appeals for Veterans Claims or reopening the claim with new and
material evidence.
VA firmly believes that justice delayed is justice denied. The VA
team is passionate about fixing the broken, antiquated appeals process;
this is a MyVA breakthrough priority. We look forward to working with
Congress, veterans, and other stakeholders to implement improvements to
provide veterans with the timely and fair appeals decisions they
deserve and we appreciate the collaboration and feedback received from
our ongoing discussions with Veterans Service Organizations on
modernizing the appeals process.
closing
Thank you for the opportunity to appear before you today to provide
additional information on VBA's 2017 budget request. We are committed
to administering benefits effectively and efficiently as responsible
stewards of the taxpayers' dollars, while continuing to strive to
improve the delivery of benefits and comprehensive information and
assistance to our veterans, their families, and survivors. We are
grateful for your continuing support and appreciate your efforts to
pass legislation enabling VA to provide veterans with the benefits they
have earned and deserve.
This concludes my remarks. I am happy to respond to any questions
from you or other members of the subcommittee.
VETERAN CRISIS LINE
Senator Kirk. Let me ask the first question here. Over the
weekend I met with the family of Illinois Army Specialist, Tom
Young, who has served two tours in Iraq with the 10th Mountain
Division. This 30-year-old father of Vivian and Maggie called
your suicide hotline looking for help, but was sent to
voicemail. Afterwards, he laid down on the metro tracks near
the Prospect Heights train station and was killed by an
oncoming train. The next morning, Tom's family answered the
call from the Veterans Crisis Line calling him back telling him
that there were beds available.
Three weeks ago, the VA inspector general released a report
on the suicide hotline calls being sent to voicemail or
answered by staff who are not properly trained. Just last week,
Deputy Secretary Sloan Gibson said that the report was based on
old data and that VA had taken steps months ago. Question for
you. If the changes occurred months ago, how could Tom Young
have been sent to voicemail just 7 months ago?
Dr. Shulkin. First of all, this is a terrible tragedy that
happened to Tom Young, and should never happen, and is totally
unacceptable. The inspector general report that was mentioned
found that there was an episode of approximately a two-week
period of time in 2014 where calls went to voicemail was also
unacceptable. This actually happened with a contractor. This
was not the VA staff at the service line when----
Senator Kirk. David, let me follow up.
Dr. Shulkin. Yes.
Senator Kirk. Who is responsible for the Veterans Crisis
Line under you? I would just like a name.
Dr. Shulkin. Yes. His name is Matt Eitutis.
Senator Kirk. Matt Eitutis.
Dr. Shulkin. E-I-T-U-T-I-S. That is a recent change that we
put in place. After the inspector general report came out, we
made a management change. We put this under professional
business practices, and we are doing everything that we can.
And steps have been taking place over the last year to update
the technology, the staffing, the physical location. And our
goal, it is one of our priorities in the Secretary's MyVA
initiative, is to make sure that these calls are answered by VA
staff, and that they do not roll over to secondary contractors.
Senator Kirk. When you say there was a contractor involved,
who was the contractor involved?
Dr. Shulkin. It is--Senator Kirk, I will get you the
specific name. It is--we use an acronym, something--I do not
want to say the wrong name. I would probably get another
company in trouble that have nothing to do with this, but----
Senator Kirk. But, David----
Dr. Shulkin. Yes.
Senator Kirk [continuing]. My staff has been trying for
weeks to find out who was the person responsible for the
Veterans Crisis Line. It is almost impossible to find out.
Dr. Shulkin. Oh, yes. You know, I know that your office had
a name, that that person has now subsequently left. If you tell
the time period you are looking for, Senator, we can get you a
specific name.
Senator Kirk. The time period that I am most interested
in----
Dr. Shulkin. Yes.
Senator Kirk [continuing]. Is when my constituent called
the crisis line. You know, for a veteran to admit that there is
a big enough problem that he is contemplating a suicide, that
is a huge decision to get on the phone with the Veterans Crisis
Line.
Dr. Shulkin. Absolutely.
Senator Kirk. And we are dealing with a very fragile
person. In the case of Tom Young, he just walked in front of
the train and got killed.
Dr. Shulkin. This is--as I said, there is no excuse for
this. The Veterans Crisis Line saves lives every day. They
actually have referred 11,000 veterans to emergency services,
dispatched ambulances, saved lives every day. These are some of
the hardest working staff in the VA. This is a tough, tough
job. They do miraculous things.
But the phone calls have to be answered. That is why we
have put new management in place. We are not going to accept
even a call--there is no voicemail today, I can assure you
that. That is unacceptable. That was done by a contractor.
Senator Kirk. Great.
Dr. Shulkin. But absolutely, we will get you that name, but
we are working extremely hard. This will not happen again, but
these people are being supported the way that they need to
answer those calls.
[The information follows: the requested information was not
available at the time this publication went to print.]
Senator Kirk. One of the acting directors of mental health
operations in 2014, at the time of the Office of Inspector
General investigation, was Ira Katz. Was he the same Ira Katz
who, according to CBS News, in 2008 covered up the veterans
suicide rates leading both Senators Akaka and Murray to call
for his resignation?
Dr. Shulkin. Senator, Dr. Katz is a psychiatrist who works
out of our Philadelphia area.
Senator Kirk. So you had two United States Senators at the
time of the congressional majority calling for his resignation,
and he is still on the job.
Dr. Shulkin. Dr. Katz is actively on the job. I am actually
not aware of what the specific issues were with the Senators.
So, again, since I am not aware of exactly what those
allegations are----
Senator Kirk. If the Choice Act gave you the authority
using the Secretary's authority to fire employees, could you
consider getting rid of Ira Katz when Senators Akaka and Murray
have already called for him to resign?
Dr. Shulkin. Well, I will commit to you today that I will
go back and look into those issues. But any time there is an
allegation, it is our responsibility to make sure that we look
into it, that we have an objective evaluation, but we do make
our disciplinary decisions based upon that.
I happen to have known Dr. Katz for about 25 years. He is a
well-respected psychiatrist. But I absolutely will go back and
make sure that we look into that and provide follow up.
[The information follows: the requested information was not
available at the time this publication went to print.]
Senator Kirk. Thank you.
Mr. Tester.
Senator Tester. Go with Tom.
Senator Kirk. Mr. Udall.
ACCESS TO CARE
Senator Udall. Thank you. Thank you very much, Mr.
Chairman. And, Dr. Shulkin and Mr. Pummill, thank you for
taking the time to speak here and be with us today. Almost more
than any other issue that we work on here in Congress, helping
veterans access benefits and healthcare is one of the most
important services my office offers to veterans.
But it is also one of the most frustrating. As I have said
here before, the majority of veterans are satisfied with the
care they receive from the VA when and if they can get it. And
I would just underline that ``when and if they can get it.''
Most veterans I have spoken to believe that the care you
provide is second to none, and this budget helps support that.
This budget, however, also helps to ensure that the VA's care
remains in place for the future and that improvements are made
where care is lacking.
OPEN AIR BURN PITS REGISTRY
Dr. Shulkin, I am glad to see that the VA's budget
justification specifically supports research into exposure to
airborne particulate matter from burn pits. The Open Air Burn
Pit Registry is the result of a bill I authored. National
Guardsman Master Sergeant Jessey Baca, and his wife, Maria, of
Albuquerque were the driving force behind this effort. Jessey
has battled cancer, bronchiolitis, PTSD, and numerous other
ailments believed to be connected to his contact with toxic
burn pit fumes while deployed in Iraq.
In last year's omnibus, I secured a provision requiring the
VA and the Department of Defense (DOD) to share information
about when and how servicemembers may have been exposed to
airborne hazards and open burn pits. Does the new research
called for in the fiscal year 2017 request include data from
DOD and the Open Air Burn Pits Registry?
Dr. Shulkin. Well, first of all, thank you. Thank you for
that bill. I think that that is very, very important for us to
fulfill our mission to the veterans who served in Iraq and
Afghanistan. As you know, we have 45,000 veterans who have
registered into your registry. And we are working with DOD to
do interagency cooperation exactly as you have suggested to be
able to study this.
Our research will be active this year. As you know, we
worked with the Institute on Medicine, the National Academy of
Sciences in the past to look at this issue. Some of those
questions actually that were asked about the exposure and the
risk hazard, there was not enough evidence. So we do need to
continue that research, and that is something that we are
committed to making progress on in our current fiscal year.
The registry helps us considerably in being able to track
these long-term outcomes of the veterans. So thank you, and,
yes, we are committed to following up on that.
APPEALS BACKLOG
Senator Udall. Great. Thank you very much. And, Mr.
Pummill, I am happy to see that the Albuquerque VA has made
significant progress, the percentage of backlog claims from
around 60 percent in 2013 to 20 percent just last month.
However, more veterans are unhappy with the decisions on their
claims, which has led to more appeals. What can be done to make
sure the appeals process does not fall victim to the same
backlog that we saw in initial claims while also guaranteeing
appeals receive the due process they deserve?
Mr. Pummill. Senator, that is an excellent question.
Appeals is the number one concern for VBA right now. The
Secretary has directed us to get with our constituents and
figure out how to resolve the current appeals process. We are
meeting next with the VSOs, the veterans service organizations,
the State and county veterans service organizations. We are
basically locking everybody in a room for 3 days, and the
Secretary told us you do not leave the room until you come up
with something that you can present to the Congress to change
the way that we are doing appeals right now.
The appeals process is tied up in laws. It is one of the
most complicated processes that exist in the Federal
Government. We are going to need some kind of legislative
change. What we need to present to you is something that we,
the VSOs, and the veterans all agree that is the right thing to
do so that we can offer that legislative change.
Senator Udall. Thank you for that answer. And I have a
couple of other questions--I am near the end of my time here--
on reform of the Comp and Pen exam, and also rural telehealth,
which I think is very, very important to our vets. And I see
that you are trying to increase investments in that area and
get additional telehealth out into rural areas. So I will
submit those for the record and yield back, Mr. Chairman. Thank
you.
Senator Kirk. Mr. Tester.
MONTANA'S CHOICE PROGRAM WITH HEALTH NET
Senator Tester. Thank you, Mr. Chairman. Dr. Shulkin, in my
opening remarks, I talked about the problems veterans are
having in Montana. Could I get your personal assurance that you
will directly engage in the efforts to address the frustrations
with veterans in my State with the Choice Program, specifically
with Health Net?
Dr. Shulkin. Yes, Senator. In fact, we have committed to
having a team out to Montana. That is going to be the week of
March 28th where Dr. Yehia and his team will personally be
there to meet with Health Net and with your staff, as well as
the staff at VA to work this out.
IMPROVING VETERANS ACCESS TO CARE IN THE COMMUNITY ACT
Senator Tester. Good. I want to follow up with you, but we
can do that offline as we move forward.
So, while pushing to make changes, I also fully recognize
that Congress needs to do what we need to do to allow you to do
your job. Today with a number of my colleagues, including
Senator Udall and Blumenthal, I am introducing legislation
called the Improving Veterans Access to Care in the Community
Act. This bill includes a number of provisions, many drafted in
consultation with the VA and other stakeholders, that will
greatly empower your efforts to deliver more timely and quality
care for our veterans.
By including provider agreement language sought by the VA,
this legislation would ensure that you are able to provide care
in the community for veterans in a timely manner. Would you
agree with that?
Dr. Shulkin. Absolutely would agree with that.
Senator Tester. Okay. The VA has previously said that a
failure to address this issue would have enormous negative
impacts on veterans' access to healthcare. A huge issue.
Dr. Shulkin. We are seeing this every day, Senator.
Senator Tester. So you would agree with that statement,
too.
Dr. Shulkin. I would.
Senator Tester. Okay. By providing funding--spending--I am
sorry. By providing spending flexibility across community care
programs, this legislation would provide the VA with the
ability it needs in places like Montana and other areas, by the
way, to steer veterans to care in the manner that makes the
most sense for that veteran. Would you agree it would do that?
Dr. Shulkin. It absolutely will. It will help simplify the
program for veterans, no question about it.
Senator Tester. Okay. And by consolidating the VA's
multiple community care programs, and there are many, into one
single program with consistent and streamlined eligibility
criteria and administrative rules, that that would reduce the
confusion for veterans and VA employees alike. Is that correct?
Dr. Shulkin. Yes, seven programs at least into one would be
very helpful.
Senator Tester. Okay, and streamlined.
Dr. Shulkin. Streamlined.
Senator Tester. Smooth.
Dr. Shulkin. Exactly.
Senator Tester. No red tape, or minimal. Let us put it that
way.
Dr. Shulkin. Yeah.
Senator Tester. And it would greatly reduce administrative
burdens for the community providers, too, then.
Dr. Shulkin. Provider agreements and the streamlined
funding would make it easier for community providers by a huge
amount, Senator.
Senator Tester. So you would anticipate that it would make
it--this Choice Program better for the providers and, thus,
entice them to come on board.
Dr. Shulkin. And I would hope your largest provider in
Montana would consider coming back.
Senator Tester. Well, so do I. Together all of these things
would assure that the VA is better able to utilize the tools at
its disposal to better meet the healthcare needs of veterans.
You would agree on that also.
Dr. Shulkin. I would.
Senator Tester. Okay. So we are going to be working with
Chairman Isakson and others hopefully in this room so that we
could get this to the President as quickly as possible.
VBA BUDGET REQUEST
I got about a minute and a half in this round. Mr. Pummill,
how does this budget ensure that the VBA is able to fulfill its
mission 1 year down the road, 5 years down the road, even 10
years down the road?
Mr. Pummill. We are going to have to take the budget that
you have provided to us, which I believe is an appropriate
budget, and with the proper training of the people that we have
on board, and with automation, take care of the needs of the
veterans into the future. We know just from past history that
20, 30, 40 years after a conflict, as veterans age we get a
large number of veterans coming in for increased benefits and
services.
We have to be prepared for the Iraq and Afghanistan
veterans that come in requesting those services in the future.
We just need to capitalize on our automation systems and our
training to make sure we are ready for them when they come.
MILITARY SEXUAL TRAUMA ADJUDICATION
Senator Tester. Could you speak specifically to the
progress that is being made, if any, and I hope there is being
progress made on this, by the way, to more properly adjudicate
claims involving military sexual trauma?
Mr. Pummill. Yes, we have made massive and substantial
changes in how we do military sexual trauma (MST). We have
actually trained people--there is at least one person in each
RO that specializes in that now so that they understand that it
is something that is not always right out front in somebody's
military records, that you have to dig and you have to find the
markers that support that.
Senator Tester. Okay. To test this a little more, do you
believe that the standards for adjudicating PTSD claims from
combat trauma should be the same standards used to adjudicate
PTSD from claims from MST?
Mr. Pummill. I believe that PTSD is PTSD. It should be the
same.
FULLY DEVELOPED CLAIMS EXPEDITED PROCESS
Senator Tester. Okay, thank you. Earlier this year I
introduced legislation with Senator Sullivan and some others
that would provide veterans with the option of filing a fully
developed appeal that would be adjudicated through an expedited
process. Do you support that? Do you think it is a step in the
right direction?
Mr. Pummill. I think it is a step in the right direction.
That is one of the things that we are going to be pushing at
our meeting next week.
Senator Tester. Do you think other changes need to be made?
Mr. Pummill. Yes, I do.
Senator Tester. What are they?
SIMPLIFY APPEALS PROCESS
Mr. Pummill. We have to simplify the appeal process so that
there are not so many bites at the apple. The best example is a
veteran who has been appealing for 25 years and has added 27
different variances to his claim as he goes through. That ties
up the whole system. It is just a waste of everybody's time.
Senator Tester. Do you have any statistics on claims that
are put forth that are bogus?
Mr. Pummill. Not off the top of my head. I do not know. We
would have to get back to you on that. Frankly it is my
experience, it is not very high. The vast majority of veterans
are honest and forthright. They are just frustrated about how
long things take. I do not see very much fraud, to be honest
with you.
Senator Tester. Okay. I will wait for the second round.
Thank you, Mr. Chairman.
Senator Kirk. Mr. Schatz.
TELEHEALTH AND TELEMEDICINE
Senator Schatz. Thank you, Mr. Chairman. Dr. Shulkin, I
wanted to talk to you about telemedicine and telehealth. I know
VA has done leading-edge work in this space. I want to--I want
to ask you two questions. First of all, generally speaking,
where do you see the future opportunities in telehealth and
telemedicine in terms of serving veterans?
Dr. Shulkin. Very briefly, Senator, VA is actually the
largest provider of telehealth services, 2.1 million visits
last year, but we need to be doing much more. We need to be
going to mobile devices because that is where people are
carrying their information. And we need to be using telehealth
as a way to keep veterans at home and out of institutions, and
having to have them travel several hundred miles to reach
facilities. They should be able to get the care where they are.
Senator Schatz. So we have a different problem on the
Department of Health and Human Services (HHS) side. They lack
some of the statutory authorities that you have. But I have a
concern in terms of funding requests because it seems to me
that you--and this is great. You expect the number of veterans
receiving telehealth services to increase by 12.6 percent
through 2017, but you have asked for a roughly 5 percent
increase in funding. Now, that may be because this is a highly
leveraged thing, but I want to--I want to understand that
discrepancy.
Dr. Shulkin. Yeah. VA, because of its early adoption of
telehealth because, frankly, we have needed to do this, has
invested hundreds of millions of dollars in infrastructure that
can be leveraged, and we can add to its capabilities without
dollar-for-dollar investments.
Senator Schatz. How did you get to the 12.6-percent target?
Dr. Shulkin. The 12.6-percent target was done out of our--
out of our projections, out of our enrollment projects, and
targeting specific areas that we believe that we can expand.
Quite frankly, I think that is conservative when you see what
is happening in the healthcare industry. We are seeing much,
much larger increases year to year. And so, I think that that
will be a conservative estimate.
Senator Schatz. How much of the challenge is introducing
patients to telemedicine, you know, at the front end? It seems
to me that on the one hand for psychology, psychiatry, case
management in terms of mental health services, there might be
less--eventually less of a barrier to accessing services. But
on the front end, it may just seem odd for people to utilize a
device to get the services they need. So how are you dealing
with that sort of getting the veteran through the threshold?
Dr. Shulkin. Well, you know, as you know, I have spent my
career in the private sector, so coming into VA months ago this
was one of the surprises, how many different specialties VA is
using telehealth in. It is doing teledermatology,
telepathology, teleradiology, telehepatology. I mean, all sorts
of things.
And we have studied the acceptance use of veterans, and it
is sky high. It is in the 90s, and we are publishing on this
now. So the acceptance really has been extraordinary because it
saves a veteran from sometimes having to travel hundreds of
miles, and they are getting the care that they need.
Senator Schatz. Absolutely, and thank you for your good
work in this area. You can count on me to try to support this
as much possible. And if you can keep talking to HHS, we would
really appreciate it as well.
Dr. Shulkin. Sure, absolutely.
ELECTRONIC HEALTH RECORD AND GAO HIGH RISK LIST
Senator Schatz. I want to talk to you about the electronic
health records. I was told that the initial read-only version
of the system would be available by the end--would be available
on some sites in 2015 with full deployment by 2018. But last
fall, GAO testified that you are not on track. DOD is not on
track. And so, my question is, what is the new timeframe, and
when do you anticipate being taken off the GAO's high-risk
list?
Dr. Shulkin. Okay. I think there are a couple of questions
there. I think your question about the electronic medical
record is about interoperability with the Department of
Defense?
Senator Schatz. Yes.
Dr. Shulkin. We currently have a joint viewer up and
operational. In fact, 35,000 VA providers are actively using
this today. So if you come into a VA, we are able to access
through what we call the joint viewer DOD records. So we are
currently operational, and would be glad to demonstrate that
for you if you are open to that, how that is working.
The GAO high-risk list, we were put on that list by GAO not
specifically because of the electronic medical record, but many
other issues. We, again, are meeting with GAO on a regular
basis and actively working that list down to close all the
recommendations. And you do not come off the GAO list very
quickly. You really have to demonstrate that you have addressed
these commitments. And so, we are working towards that. We hope
that we are making good enough progress to be able to give an
indication of where are towards the end of the year.
Senator Schatz. Thank you.
Senator Kirk. Mr. Boozman.
Senator Boozman. Thank you, Mr. Chairman, Ranking Member.
Thank you all very much for being here. We appreciate your hard
work.
STANDARD PRODUCTIVITY MEASURES
Dr. Shulkin, I know that one of the things I have been
pleased with that you all really are trying to do a good job
regarding metrics, measuring things. In regard to being able to
determine the cost associated with providing care versus buying
care in the community, I know your IT infrastructure is maybe
not quite as good as you would like for it to be. Can you talk
a little bit about that and how you are trying to determine
that, again, in a difficult environment?
Dr. Shulkin. Right. Thank you, Senator. We are very data
rich at the VA. It is one of our strengths, why we have been
able to drive improvements particularly on the clinical side.
And wherever we can, we are trying now to use metrics that we
can compare to the private sector because I think that is
appropriate. In fact, we have too many metrics, so we are
trying to pare it down to what is most important.
The area that we struggle the most with are financial
comparisons because what we do in the VA does not directly
compare always--sometimes it does, but does not always directly
compare to the private sector. So we have begun to measure
relative value units (RVUs), so we know--which is standard
productivity measure both in the private sector and the VA, so
we can tell you VA actually increased its RVU, its productivity
measures, 10 percent last year.
The direct financial comparisons are a challenge, so what
we are beginning to do is to ask specific questions. What would
it do for an eye exam in the VA healthcare system versus
outside? And so, we are going to be making specific choices
about what is better for veterans, what is better for taxpayers
as part of the new Veterans Choice Plan to bring those
financial considerations in place.
And let me just ask whether our Chief Financial Officer has
a better or more specific answer about these comparisons.
Mr. Yow. One of the challenges we have had is we do a lot
of things in the VA that are not comparably done in the private
sector, things like homeless programs, things like the fact
that we have a richer mental health benefit, things like if we
have a richer long-term care benefit program than in the
private sector insurance would have.
So when we get asked questions like cost per RVU, it really
becomes an apples and oranges comparison unless we try and
drill down and get that further. And our systems are so old
right now, it is very difficult for us to go through to get
that granularity to do that. It is not for lack of wanting that
we have not been able to do it thus far.
HEALTHCARE FACILITIES BUDGET REQUEST
Senator Boozman. Very good. Not in follow up, but another
question to our chief financial officer, the VA budget requests
$836 million for the activation of new and enhanced healthcare
facilities. What are the VA's priorities for the upgrades? How
much of this funding will be used for new facilities versus
enhancements? And has the VA determined where the projects will
be located?
Mr. Yow. Yes, sir, we have a list that we provided the
staff, and we can provide that to you again, the specific
projects locations. They are all from what we call major
construction or major lease projects, so they are essentially
new facilities more so than renovations or replacement leases.
That is where we fund activations from.
It primarily does two things. It does what we call non-
recurring cost, initial outfitting, if you will, of a new
facility, things like equipment, supplies, and so forth, to get
it ready to open its doors. And then recurring costs for about
a 2- to 3-year period as they prepare to open their doors and
make their way into the healthcare projection model and get
funding for them into the future.
So, for example, if it is a recurring lease and there is no
new staff, they would not need as much recurring funding. But
if it is expanding or a brand new facility, we would have to
hire new staff as well. So it varies a great deal by project.
Senator Boozman. And the average age of our infrastructure
is what, 50?
Dr. Shulkin. We have about 60 percent of our facilities are
50 years old or older.
Senator Boozman. Very much. Thank you, Mr. Chairman. Thank
you. Thank you, guys.
Senator Kirk. Mr. Murphy.
Senator Murphy. Thank you very much, Mr. Chairman. Thank
you all for your fantastic work.
OTHER THAN DISHONORABLE DISCHARGE
You are probably aware of reports that the U.S. Army has
forcibly separated over 22,000 soldiers for misconduct after
they return from deployment in Iraq and Afghanistan that were
also diagnosed with mental health problems or traumatic brain
injury (TBI). As a result of this disclosure, the Army
inspector general and the surgeon general are going back and
doing a review of those 22,000 cases and apparently are going
to make recommendations as to some of them and some
recommendations going forward.
But as I understand it, the VA looks at the character of
discharge to determine whether a person meets the basic
eligibility requirements, and you determine whether the
incidents that led to the discharge are found to be under
conditions other than dishonorable. So you have essentially a
chance to look at those conditions of discharge and make a
determination as to whether they would be able to be able for
benefits.
So I do not know whether this is a question for you, Dr.
Shulkin, or for you, Mr. Pummill, but to ask a question about
what has the VA done in the wake of this disclosure, and
pending this review that is happening in the Army, what can you
do to perhaps remedy some of those 22,000 who should have not
been given a discharge under non-medical terms?
Mr. Pummill. Yes, Senator. First of all, it is a serious
concern for the VA. We know that most of these men and women
are going to end up homeless, that they already have one foot
in a bad place, and this does not help. Some of the things that
we--first of all, we cannot change the character of discharge.
Only the military service can do that. We do contact the
veterans. We advise them how to get to the Army Board for
Correction of Military Records or the equivalent in the other
services so they can request a change in their discharge and
upgrading their discharge.
We have worked with the services. The services have sent
out letters to veterans saying, hey, if you feel that your
discharge may have been improper because of something that
happened to you in combat or deployment, please come back, file
your paperwork. They are not getting a very high response rate,
so we sent letters out underneath the Under Secretary of
Benefits' signature to those same veterans to see if maybe a
letter from the VA saying, hey, go back to your military
department, if we could help it out.
Senator Murphy. But let me just clarify.
Mr. Pummill. Certainly.
Senator Murphy. My understanding is that you have the
ability to review the circumstances of the discharge. If there
is a discharge for misconduct, you are saying their only
recourse is to go back to have the conditions of discharge
changed.
Dr. Shulkin. Senator, that is our understanding that this
is a Department of Defense decision. This is not a VA decision.
And we are prohibited by law from treating somebody in what we
call bad paper, a dishonorable discharge.
Senator Murphy. And that is your understanding as well?
Mr. Pummill. It is my understanding that we cannot change
the character of the discharge, Senator, yes.
Senator Murphy. Okay.
Dr. Shulkin. One of the things that VA is doing because
they take this very seriously, and I know this is where you are
coming from, too. It is one of the reasons why we have worked
so hard to develop strategic partnerships with community groups
because when we find these veterans and they show up at VA, we
are working with community groups to actually help in the
treatment of these patients.
Senator Murphy. Mr. Chairman, I just want to underscore
this, and Senator Tester has been a great leader on this. There
are 22,000 veterans out there today just since 2009----
Senator Kirk. Yes.
Senator Murphy [continuing]. Who have been discharged for
misconduct, who prior to that discharge had a diagnosis of TBI
or PTSD. There is an ongoing investigation as to the
circumstances of those discharges. We as a subcommittee have to
grapple with the fact that you have--it is not just what we
know about it, right? Twenty-thousand brave men and women who
were potentially wrongfully discharged for misconduct who
cannot access VA services who are going to be out on the
streets. So I would love to follow up with you----
Mr. Pummill. Yes.
Senator Murphy [continuing]. On this topic to think about
ways in which--while this review is happening. I have asked for
a moratorium on discharges for misconduct with respect to
individuals who have been diagnosed with PTSD or TBI during
this period of review. The Army has not looked favorably upon
that request, so the numbers are just going to continue to
mount.
I have another question, but I will put it in for the
record.
CONNECTICUT CAMPAIGN TO END CHRONIC VETERAN HOMELESSNESS
Senator Murphy. I just want to thank you for your work with
Connecticut on our campaign to end chronic veteran
homelessness.
Dr. Shulkin. Congratulations.
Senator Murphy. We are the first big State in the Nation to
do that.
Dr. Shulkin. Yes.
Senator Murphy. And that is a consequence of a dramatic
increase in HUD vouchers, which we desperately need to keep or
we will slide back on that commitment. But it is also a
consequence of your very successful integration of mental
health services with physical help services that has allowed us
to make those great gains. And I congratulate you on doing
something in the VA that the private sector should be doing at
a much greater rate.
Dr. Shulkin. What we have learned, Senator, is this is all
about working with the community, and the Connecticut
leadership coming out of the Governor and your community groups
have really--they deserve the credit for this. And we thank you
for your support.
Senator Murphy. Thank you very much, Mr. Chairman.
Senator Kirk. Senator Cassidy.
Senator Cassidy. Dr. Shulkin, you have got an impressive
resume, man. I wish my resume looked like yours.
Dr. Shulkin. I think you are doing all right.
Senator Cassidy. My son does not think so, but that is a
son, huh? We are both physicians, so as you know there is a
collegiality. I will go around the country and visit with
different--Murphy and I have this connection with mental
health, so the mental health folks in the VA will come and
approach me. I have learned, at least this is a little bit
dated, but your administration is new, so I will ask you again
to see if it has changed.
MENTAL HEALTH NO-SHOW RATE APPOINTMENTS
There is great variability in the systems used for mental
health. I gather there might be a place in Kansas which is
really working well, but you go elsewhere and the doc will,
say, oh, yes, if they miss their appointment, they are
scheduled 3 weeks later. The better system is to leave some
slack at the end of the day, and to know that there are going
to be a certain percent late, but that some of the folks will,
you know, frankly be pleased that they are less busy.
To what degree do you have the ability to look at no show
rates, average time to rescheduling, average time for new
appointment, et cetera, and compare them against one another?
If you are able to do that, what is the current variability
between different clinics?
Dr. Shulkin. Excellent questions. We have a 20-percent-plus
no-show rate in mental health appointments.
Senator Cassidy. Now, is that standard or, no, here it is
three, and there it is 60?
Dr. Shulkin. There is a wide spectrum. And so, what you are
describing is the situation that I found when I came in, which
is that VA has tremendous variability in many of these clinical
measures. And what healthcare systems that are accepting the
challenge of being healthcare systems are doing now are
decreasing that variability. They are identifying best
practices and standard----
Senator Cassidy. Totally get that. So that is what your
expertise is.
Dr. Shulkin. Absolutely.
BEST PRACTICES SYSTEM
Senator Cassidy. To what degree can I go to a clinic now
that formerly told me, oh, man, we got all kinds of no shows,
and I cannot get anybody to change it, to, no, we actually have
the system such as best practices?
Dr. Shulkin. The first thing that we have done already is
we have identified these best practices. We had a call for best
practices in the last month where we identified 250 of the best
practices in VA, many related to access. Today we have brought
in those best practice leaders to share and map out their best
practices. Tomorrow we are bringing in the industry leaders in
how to do best practice implementation to advise VA.
We are committing towards the end of the year to have these
best practices in place. It is exactly what we need to do, and
it relates to what the GAO found that put us on the high-risk
list.
Senator Cassidy. So I know that--again, you and I both know
this--in healthcare systems, it is data, data, data. To what
degree can you share with each of us as regards what the
institutions in our State are doing at this moment in time, and
then the trajectory of how they are improving over time.
Dr. Shulkin. Be glad to do that. VA is actually very good
at producing those metrics. We have clinical metrics, outcomes
called the sail measurement system, which we can share with you
and show improvement, or actually those that are not improving,
and on access measures, lots of data that we can share and
other process measures. And, in fact, we are targeting this.
This is one of my five priorities to implement these best
practices.
FRONT LINE DISCIPLINARY ACTION
Senator Cassidy. Now, also related to all this, again, the
kind of conversation someone will tell me, but will not do it
under oath, that there is at the front desk perhaps someone who
is abusive to that patient who comes in, the veteran who
perhaps is different because he has a mental health issue, and
very rude. We have focused a lot on high-ranking officials
within the VA and the difficulty of replacing them. What this
doc tells me, I cannot get rid of that clerk, that that
actually has to go here and then there.
I toured a VA and asked the director, and he goes, well,
there is a report, and we counsel, and it comes back. What I
really got a sense of is that it would take months, maybe even
a year or two, in order to get rid of someone who is at the
front desk. Again, not talking about the person padding their
check by everything we have read about in the paper, but that
person right there speaking to that vet who is having a hard
time keeping it together, and, therefore, acts a little
strangely.
To what degree is that true, and to what degree do the
union contracts kind of limit the ability to discipline,
replace, make it better for the veteran? I will stop there.
Dr. Shulkin. Well, one of the things when the Secretary
came in, as you know he had us all sign and agree to the I Care
Principles, of which respect and customer service is right
there. When we find that people are not sharing our values, my
expectation is, the Secretary's expectation, is that we are
going to take actions to remove people who are not following
the VA values.
Then you get into due process, and we have due process, and
we need to adhere to it, and it is longer than some of us want
and more complex. But we are not going to let somebody be
disrespectful to veterans and stay in those positions.
Senator Cassidy. Now, let me say I have worked in a public
hospital, and there are 95 percent great people struggling to
make it work, and there is 5 percent that really--but that 5
percent becomes the face of the organization, and at times that
one person destroys it for that patient, if you will. Believe
me, I have worked in a hospital in Louisiana. I know that.
You spoke of due process. Let us assume that there is
someone, as we have described, as I have been told of. I have
learned to say what I have been told, not what I know, but that
what I have been told of. How long would it take for that
person to be dismissed?
Dr. Shulkin. Our expectation is that if there is a behavior
that is not consistent with our values, they would be removed
from that position, the veteran patient position. And then we
have to assign them to other work, hopefully not involving
direct contact with veterans, and let the due process, you
know, work its way through. But it would not be acceptable
because of bureaucracy and red tape to allow a person who we
know is not sharing our values to continue with a direct
veteran-facing position.
Senator Cassidy. So that person could be reassigned fairly
quickly----
Dr. Shulkin. Absolutely.
Senator Cassidy [continuing]. As in a month or a week?
Dr. Shulkin. Oh, no. I am talking about immediate. When
somebody comes to us with a concern or allegation, it is
investigated because, as you know, as you said, in a lot of
these situations in my experience, you know, it is not always
what you first hear the story.
Senator Cassidy. I get that.
Dr. Shulkin. So you have to get the facts. But if the facts
confirm that this is a person who is not treating veterans the
way that we believe they should be treated, then they should be
removed from that position immediately, reassigned to something
else while there is due process. There are certain violations
that would be immediate termination, and we certainly do that
as well.
Senator Cassidy. There is an inspector general report about
a fellow who actually killed a patient who is still on the job,
so that is kind of what--just to say that is high profile. But
just to say it seems as in in theory sometimes it takes a long
time.
Dr. Shulkin. I would like to get that specific situation
from you and then follow up with you on that. That certainly is
a circumstance that I would want to know about.
Senator Cassidy. Okay. I yield back. Thank you.
Senator Kirk. Mrs. Capito.
Senator Capito. Thank you, Mr. Chairman, and thank all of
you. I apologize for not being able to hear the entire hearing,
but we have got several going on at the same time, as Senator
Murray and I have seen each other a couple of times today. So I
appreciate your--and so if I repeat a little bit, please excuse
me.
CHOICE PROGRAM THIRD PARTY ADMINISTRATORS
I wanted to talk about the Choice Program. We just had some
veterans in our office the other day. In one instance, the
veteran had an appointment with a specialist, only to find when
he called that office, the entire facility did not have that
type of specialist. And it was the second call that that
facility had had for that type of specialist. The same veteran
had another instance where he had called Health Net Choice four
times to have an appointment made and did not get satisfaction.
We are hearing these stories all over the place.
And I guess, what is being done from your perspective, and
I am going to say are these the third-party administrators that
are not filling the gaps? What are you all doing to hold the
third-party administrators' feet to the fire here?
Dr. Shulkin. Okay. I should start off by saying that the
Choice Program is not working the way that any of us want it.
So I am aware that you are probably not the only Senator who is
getting a lot of these issues.
We are continually meeting with the third-party
administrators, and not only letting them know it is our
expectation that they adhere to the contract. The contract says
that a routine consult needs to be scheduled in 5 days. An
urgent consult needs to be scheduled in 2 days. And when they
are not able to do that, we need those authorizations returned
to the VA so we can use our community relationships to help the
veteran.
We are not only working with them, but we are throughout
the country now trying new models of delivering care, like
embedding their staff alongside our staff to be able to try
this. So we are doing this in Alaska and several other sites.
But the program is just simply not working the way that we
intended it to work, and we are going to stick at this until we
can get this working better for veterans. So we would ask if
you are hearing specific veterans having issues, please let us
know with their names so we can help them.
Senator Capito. Okay. That I will do, and I know that it
just seems like there is a lot of confusion.
Dr. Shulkin. Yes.
Senator Capito. Best intentions aside, it is still, as you
said. And I appreciate your candor there really.
Dr. Shulkin. One of the things that you missed, Senator, is
Senator Tester had mentioned that part of this we need your
help on. And Senator Tester and Senator Blumenthal and Udall
just submitted a bill that helps us consolidate community care,
simplify this for the veterans, simplify it for the VA. And so,
this is where we could use your help because have identified
where the program needs to change and what we have learned over
the past year. That would help us a great deal.
VETERANS TO AGRICULTURE PROJECT
Senator Capito. Thank you. Thank you. One of the programs
that I have been sort of interested, it is a small program, and
it is growing--it is in West Virginia and growing in some other
States. And it is the West Virginia Warriors and then Veterans
to Agriculture Project. It seems to have met with quite some
success with some of our younger veterans.
So I do know, Mr. Pummill, I do not know who would take
this question. What are you doing with--in terms of encouraging
veterans to transition to agriculture? Is that part of an
emphasis within the VA, and how is that going?
Mr. Pummill. We have expanded what we encourage veterans to
do when they leave military service greatly under the new
transition program. It used to be, you know, pretty much your
only option was use the GI bill and go to college. Now we are
offering a GI bill, agriculture, entrepreneurship where they
can learn how to start their own business, or technical
training, technical schools, truck driving, things like that,
realizing that one size does not fit all. And we are trying to
find the thing that best suits that individual and lead them in
the transition to that
The best success we have had, like you just said, in West
Virginia is working with the State and local agencies so that
when we know where the individual, which State he or she is
going back to, they have somebody to link up back there with
what they need to do.
OPIOID DEPENDENCE AND ALTERNATIVES
Senator Capito. Right. Good. And then lastly, Senator
Baldwin and I have under her leadership worked on the Opioid
Safety Act, which as a result for me was from a young man,
Andrew White, who I believe died in his sleep, I think, as a
result of a shoebox of prescriptions that had been filled--
prescribed to him by the VA.
What are you doing in this area now that you have more of a
directive and I think more of an area of emphasis because of
what we have done here?
Dr. Shulkin. I think as you know, and we appreciate your
leadership in this, the opioid dependence crisis is really a
national crisis. I was at a dinner last night with the director
of the Centers for Disease Control and Prevention (CDC) who
said this is the area he is most concerned about nationally.
Fortunately I think VA, and thanks again to several of you who
have taken the lead on this, has really understood this for
several years. And we are doing really what the rest of the
country should be doing. Our numbers are going down while the
rest of the country is going up.
Senator Capito. In terms of prescribing?
Dr. Shulkin. In terms of number of veterans on opioids and
finding alternatives for them. So we have instituted mandatory
training. We have instituted mandatory reporting into all the
States that require the drug monitoring programs. We use a
stepped management approach. We are encouraging providers with
what we call academic detailing where we train them to use
other non-medication approaches to pain management, like
integrative therapies. We have adopted not only the CDC
guidelines, but work with DOD on DOD-VA guidelines for opioid
management.
So we are making progress. We need to do much, much more,
but our numbers are coming down, and I think we are headed in
the right direction. And we are going to stick at this until we
can actually get to this to the very minimum number of patients
who need to be on opioids.
Senator Capito. Thank you.
Senator Kirk. Mrs. Murray.
Senator Murray. Thank you, Mr. Chairman.
CAREGIVERS PROGRAM
Mr. Secretary, Dr. Shulkin, I am really pleased to see that
you are requesting a significant increase for the Caregivers
Program, which, as you know, gives veterans more control over
their own healthcare and supports the loved ones who sacrifice
their life, their own time, their health, their energy to
provide that care. This is really a personal issue for me. My
mother cared for my father, who was a World War II veteran,
after he developed MS, and I know the impacts to these
families.
So now as demands on the VA continues to rise, I strongly
believe that the Caregivers Program is really a key to helping
VA carry out its duty to provide accessible high-quality care.
And to make this program work, the VA is continuing to increase
the number of Caregiver support coordinators. Considering the
expected increase in Caregivers, and if we can finally pass the
legislation to expand the Caregivers Program to all veterans, I
am concerned we will need more.
And my question for you today is, is the workload for
individual Caregiver support coordinators going down, or do you
need more staff to keep up with the demand?
Dr. Shulkin. Yeah, it is a great question. This is--Senator
Murray, I know you are passionate on this, and I thank you for
that. This is an area that VA is so different than the private
sector in recognizing this and supporting Caregivers.
Interestingly, the data is coming out now to say this is a
cost-effective way to manage healthcare costs.
Senator Murray. I am not surprised, but I am glad there is
data.
Dr. Shulkin. Without Caregivers, these patients end up back
in the institutions, and they do not want to be there, and it
is very expensive to keep them there. So we are expanding this.
And you are correct, we do need to keep up with the caseload
because Caregivers need support. Elizabeth Dole, Secretary
Dole, is very articulate about this, and has actually been
working with us to help us support our Caregivers.
So the workload is going up, but we are so pleased to be
able to expand this program with this budget request.
Senator Murray. Okay, great. Secondly, I have heard from
veterans in my home State of Washington who are frustrated
always about waiting months or even longer to get answers to
questions about benefits and care. So I am really pleased to
see that you are requesting significantly more funding for both
the Health and Benefits Administration. That is really
essential to providing good customer service.
But I am concerned again whether that will be enough and
whether the Department is managing its money appropriately. The
crisis that we faced last year when the VA threatened to shut
down the healthcare system and nearly ran out of money cannot
be repeated. So the funding that we provide in 2017 and 2018
has to account for major increasing demands on the VA,
including providing, as you know, treatment for hepatitis C,
increasing demand for care both in the VA and in the community,
and the costs associated with the VA's new proposal to
consolidate care in the community.
FORECAST FOR BENEFITS DEMAND
So in light of all of those pressures, how do you
anticipate demand for care benefits growing over the next 2
years?
Mr. Manker. So we--as look at the caseload, what we see
is--in 2017 and 2018 we see an increase in the request for
claims. And the second and third order of effective claims is
as folks file claims that we--they go over to the Health
Administration for care there.
Senator Murray. So you see increasing demand.
Mr. Manker. We do.
Senator Murray. And does this budget accommodate that?
Mr. Manker. I know from the VBA perspective it does, yes.
Senator Murray. Okay, because that is what we hear
constantly from our constituents when we do not have enough
people out there to process. So we are going to be looking at
this closely.
CAREGIVER TRACKING SYSTEM
Let me go back again, Secretary Shulkin, to you. The budget
request actually attributes most of the increase in the
Caregivers Program to more Caregivers receiving stipends. But
as you know, one of the GAO recommendations for the Caregiver
Program is to create a new IT system to administer the program
and to make it more efficient. This system will be really
essential as we come closer to expanding the Caregiver Program.
I wanted to ask you, is there enough funding in your request
for the new Caregiver Tracking System, and will it be ready on
time?
Dr. Shulkin. Senator, that is something that I going to ask
if I can back to you on because that is--I am going to need to
work with counsel and the OI&T on that, and make sure that
there is the appropriate resources to do that. And if I could,
I would get back to you.
Senator Murray. Okay. If you could answer me for the
record.
Dr. Shulkin. Yes.
[The information follows: the requested information was not
available at the time this publication went to print.]
Senator Murray. And that is a really important part of
making this work effectively.
Dr. Shulkin. Yes.
Senator Murray. So we need to have that ready, on time, and
at capacity.
Dr. Shulkin. Absolutely.
Senator Murray. Thank you very much, and I will submit the
rest for my record--questions for the record.
Senator Kirk. Now, the Senator from King Cove, Alaska.
VA HEALTHCARE SYSTEM IN ALASKA
Senator Murkowski. Thank you, Mr. Chairman. Dr. Shulkin, it
is has been about a year since you last visited my office. I do
appreciate you coming to the State last summer, but I regret to
tell you that we have seen very little follow up on the state
of the VA health system in Alaska. So let me tell you where I
think we are right now in Alaska, and this is not necessarily
through my eyes. This is through the members of the Veterans
Service Organizations that have been flooding my office in the
past several weeks.
Before you and Secretary McDonald came to your jobs, we had
a VA system--a healthcare system that worked up in the State.
Our vets were seen in a timely fashion. Those that had
conditions that could not be handled by the VA were seen in the
community at fee-based care providers. We had good partnerships
with our community health centers and with the native
healthcare system to back up.
But the vets who have been coming in, again, over these
past weeks and when I have been up home, they are telling me
that the current leadership team at the VA took a system that
was working well in our State and went about dismantling it.
And a couple of illustrations here with regards to the Choice
Act that did not require the VA abandon its legacy fee-based
programs. VA reads it otherwise, and canceled fee-based
appointments. These vets were forced to deal with the
dysfunctional TriWest referral system. They still are. Veterans
who have been forced to use the Choice Act then discovered that
VA did not pay for their care as they had done previously. And
now what we are getting--the letters that I am getting from
vets are saying my bills are being sent to collection agencies
when the VA does not pay.
We do not have very deep representation with medical
specialists, but specialists who were willing to take the
Choice card are now telling me they do not want to have
anything to do with the hassle, nothing at all. So we have got
a loss there.
We had a great and innovative director at Anchorage VA
Healthcare System. Not there anymore. That position has still
not been filled. There is still no full-time physician at the
Wasilla CBOC (Community-based Outpatient Clinic). The VA is
able to find some providers who may consider relocation, but
then they pull out after the relocation promises that have been
made by the VA recruiters are withdrawn because they never
should have been made. And, again, we are not seeing VA senior
leadership coming and saying we have got--we are willing to
work with you. We are going to solve these problems.
So the question to you, Dr. Shulkin, is how would you
assess--I have given you my assessment and the assessment of so
many of the veterans who are coming to my office. But how would
you assess the state of the Alaska healthcare system for the VA
in my State right now? What needs to be done to restore the
access and the quality of care that our veterans had, but they
no longer are experiencing?
Dr. Shulkin. Okay. Well, you have mentioned a lot, Senator,
and so let me try to briefly just tell how I look at this. I
think that you have identified several things. So pre-Choice I
think Alaska had a very innovative system that was working
well.
Senator Murkowski. It took a long time, but we got there.
Dr. Shulkin. No question about that. Choice was implemented
and system was changed. And I think that some of the situation
you are talking about was dated a while ago where essentially
we were not using fee-based programs. We were not using
community care programs, and we were only using Choice. That
situation has now changed in Alaska where after our visits up
there, we are working very closely with the Indian Health
Service, we are working with the South Central Foundation, we
are working with the DOD facilities there where I think that
you are not seeing some of the problems that had existed
before.
The Choice Program still continues to be a challenge, and
that is why we have worked closely with TriWest to actually
embed TriWest employees in with our VA people, and there are
three embedded TriWest employees today in the Anchorage
facility. It still is somewhat problematic, and that is why we
are continuing to ask for a contract modification so that VA
can take over the scheduling of those patients, very similar to
what you had before. And we are waiting for that contract
modification to be approved.
So Alaska is--was a system that, frankly, was a great model
for the country. It went through some tough times. We are
trying to get that back. I think that part of what we are
trying to do with this new legislation that Senator Tester has
taken the lead on is to bring back the customer service pieces,
what you had in Alaska back to the VA. And we know that we have
a lot of work to do.
Senator Murkowski. Well, and I am sure you can appreciate
the frustration of the many veterans who for years had
struggled with a system that did not work, and then through the
good work of cooperation and collaboration between IHS,
community health centers, we kind of built this system.
Dr. Shulkin. Yes.
Senator Murkowski. And we were providing the care that our
veterans deserved and expected, and we wanted to be able to
provide, and it worked throughout agencies. And then we come in
and we have got this top down approach, and we are starting all
over. And your term ``somewhat problematic''--``somewhat
problematic''--is not what I am hearing from our veterans. They
are saying it is fouled up! It is screwed up. It is a mess. And
it is unacceptable. It is unacceptable because we know how to
correct it because we corrected it. And then you come in and
you create chaos.
So we had asked in the fiscal year 2016 approps bill that a
report be submitted on the current status of VA healthcare in
Alaska. We are waiting for a status of that report. You know,
you suggest that some of the information that I have here is
dated. It is not--it is not dated, not based on the experience
of veterans who are trying to access their healthcare now, who
are getting these bills from collection agencies now. This is
not based on some things that were happening a year ago, 6
months ago.
So I am--we will have Secretary McDonald here before the
subcommittee, and I certainly intend to ask him what corrective
actions plans you have regarding all of these issues that I
have outlined. In the interim, it might be helpful certainly
for you all and my staff to meet to have a more comprehensive
conversation about the quality and the access because what is
happening now is the--is the quality of care, the access to
care has been compromised for these Alaskan veterans. And there
will be no compromise. There cannot be no compromise for these
healthcare benefits.
And, again, I think part of the frustration that we have is
we have come so far only to see it turned over literally within
the course of a couple months. And you cannot pull the rug out
from underneath those who have earned these healthcare
benefits, and that is exactly what your system has done.
And we thought that the visits to Alaska were going to
materialize in some changes that our veterans could see, but I
am pressing each and every one of them. I am saying you got to
be honest with me because the information that we get from you
is the most telling. And what they are telling me is it has not
been fixed, it has not been corrected, and they are not doing
enough.
There is no compromise on what our veterans have earned, so
know that we are going to keep working at it. And it would be
great if we could set up some time to sit down on that.
Dr. Shulkin. Senator, I just want to mention a few things.
First of all, I appreciate where you are coming from. I heard
it personally----
Senator Murkowski. I know you did.
Dr. Shulkin [continuing]. In Fairbanks, and Anchorage, and
the Kenai Peninsula. And these were packed houses of people
saying exactly what you are saying.
But I just do want to say a couple of things that I hope
will be helpful. First of all, this was the Choice Program.
This was Congress' program that we are trying to make work, and
we understand that it is not working well, and that is why we
are working with you, and we look for your support to make the
changes that we need to make.
But currently, 96 percent of all appointments are scheduled
within 30 days in Alaska. We have 120 outstanding consults more
than 30 days that are urgent consults. They are all out in the
Choice Program. They are all scheduled, but that is too long,
and that is what we are working with TriWest to fix to make
sure that we can improve that.
In terms of putting veterans in line with their own credit,
unacceptable. We do not want that happening. We have
established a toll free hotline now that is 1 (877) 881-7618
that veterans should call if they are being hounded by
creditors so we can intervene on their behalf because we do not
want them put in that position. And I know that is happening
for people in Alaska and across the country, and we are going
to--we are going to help them with that. Thank you.
Senator Murkowski. Well, I look forward to our sit down.
Thank you, Mr. Chairman.
Senator Kirk. Senator Baldwin.
Senator Baldwin. Thank you, Mr. Chairman.
ADMINISTRATIVE INVESTIGATION BOARD ON MILWAUKEE DOMICILIARY
Dr. Shulkin, as a result of concerns that I reported and
shared with the VA, the VA convened an Administrative
Investigation Board in October of last year to review many
allegations regarding improprieties at the Milwaukee
domiciliary. One conclusion reached by the Administrative
Investigation Board, otherwise known as AIB, was that the
domiciliary environment was not safe and secure.
An issue raised to corroborate this assertion was that the
non-inspection of veterans' belongings. Veterans were found to
have alcohol, box cutters, and straight razors. More alarming,
during the time of that review, while the AIB members were
there, a veteran tried to commit suicide.
Mr. Chairman, I would like to insert in the record a news
article that appeared last night on CBS 58 in Milwaukee that
has to do with the story that I am about to tell.
Senator Kirk. So ordered.
Senator Baldwin. Thank you.
[The information follows: the requested information was not
available at the time this publication went to print.]
Senator Baldwin. In my view, this puts a finer point on the
need to inspect what veterans and visitors are bringing into
the domiciliary. Last year, a young veteran, a resident of the
VA domiciliary in Milwaukee, he was recently out of a rehab
program, overdosed on heroin, and was found dead in his room at
the facility. My understanding is that he was able to bring in
needles into the facility and potentially the drugs that caused
that overdose. This is someone who came to the VA for help.
Dr. Shulkin, I am very concerned about the whole
domiciliary program. At my request, the inspector general's
office is reviewing the issues surrounding the death of this
young veteran. But I think we need to go a step further and
reassess the program to determine whether security measures
nationwide are appropriate, and whether domiciliaries are the
right place for veterans such as ones who have attempted
suicide or who have overdosed. It seems to me that a facility
like this has lax oversight of its resident population, and may
not be the best place for these veterans.
So can you speak today to the security of VA domiciliaries,
and whether you are willing to take a hard look at the
appropriateness of the program for veterans who may need
greater supervision?
Dr. Shulkin. Yeah. Senator, what we are talking about is
the best approach towards this issue that, frankly, is a
national epidemic we are seeing all over the country on
substance abuse. And veterans are a particular risk for
substance abuse.
And so, the domiciliary programs are part of our approach,
and I do think, and I am open to taking a look at better ways
of doing this and better ways of trying to address both
treatment and prevention of substance abuse. And I wish I could
tell you that we have found the magic bullet for this, but we
need to be trying harder.
On the issue of security, I will tell you this is a problem
for hospitals everywhere. I have struggled with this throughout
my career. It is simply is not possible to search every patient
and every visitor and ensuring what they are bringing in does
not contain drugs or paraphernalia like syringes. It just
simply would not be effective. You would have to have
essentially what amounts to what they do in prisons, which we
do not want our facilities to be like that.
So what we do is we need to set up rules about behaviors
that we expect and what happens and consequences if you break
those rules, being discharged from the programs. Do we need to
look at new ways to be able to make sure these are safer
places? Absolutely we need to. But I do not want to give the
expectation that by searching people we are going to be able to
prevent this completely.
Senator Baldwin. Okay. Just in follow up and based on your
answer, there is absolutely a range of activities and
procedures that could be put into place to increase safety and
security beyond the search issue. I will note that I have heard
that the AIB members who were present on site to conduct their
investigation were able to gain access the facility with no one
checking them at the door or even, you know, they were already
wandering about. And so, that obviously suggests a lax set of
protocols.
I would appreciate it if you can commit to reporting back
to this subcommittee on at least an initial review of the use
of these domiciliaries, and the security, and supervision
levels, and safety. This is a big concern.
[The information follows:]
Context of Inquiry: Will VA commit to reviewing the domiciliary
program, including the security and safety protocols and the
appropriateness of participation of veterans who may require greater
supervision? When can we expect the results of that review? [reference
Dr. Shulkin's testimony that he is ``open to taking a look at better
ways of doing this.'' And ``Do we need to look at new ways to be able
to make sure these were safer places? Absolutely, we need to.'']
Response: VHA Domiciliary Care programs are safe, effective and an
appropriate level of care for Veterans with mental health and substance
use disorders when appropriately operated in conformance with national
policy. VHA will continue to closely monitor domiciliary safety and
security and look for opportunities to improve Veteran care. One
Veteran death is too many and every effort will continue to support the
medical centers in providing a safe and secure environment focused on
recovery. Veterans admitted to the residential treatment programs are
assessed as needing increased supervision and support for symptom
reduction and engagement in recovery and for whom outpatient care has
not been effective. VHA's residential treatment programs provide vital
services in the mental health continuum of care which includes general
outpatient, intensive outpatient, residential and acute inpatient. VHA
fully recognizes the increased risk in serving Veterans with mental
health and substance use disorders in a residential level of care.
At the end of fiscal year 2015, VHA operated 244 Mental Health
Residential Rehabilitation Treatment Programs (MHRRTP) with 8,148 beds
at 113 VA Medical Centers. During fiscal year 2015, there were over
37,500 admissions to domiciliary care with 87 percent of the Veterans
admitted having a Substance Use Disorder (SUD) diagnosis. Over 15,000
Veterans were provided residential specialty care specifically to treat
their SUD. In fiscal year 2015, there were over 2 million patient bed
days of care provided in VHA Domiciliary programs. During this period,
there were 13 reported Veteran overdoses resulting in four overdose
deaths. The mortality rate for Veterans during their residential stay
during fiscal year 2014 was 0.06 percent and has decreased by 56.8
percent since 2004.
VHA is currently revising and updating the VHA MHRRTP Handbook,
1162.02. The revisions will include updates to safety and security
policy and procedures based on lessons learned since the Handbook was
published in 2010. VHA recently updated guidance clarifying
expectations for contraband detection and prevention in Domiciliary
programs. This guidance has been shared with key stakeholders and was
recently shared with the field. Concepts discussed in the guidance
document have been routine topics of conversation with the field
through regular monthly calls and at the National MHRRTP Managers
conference on May 3-5, 2016. A significant step forward in the safety
and supervision of VHA's residential care is the current development of
a Nursing Model that will guide the provision of 24/7 nursing services
in Domiciliary programs based on the Veteran's needs. This
collaborative effort between the Office of Nursing Service and Mental
Health Services is currently being piloted at ten Domiciliary locations
and when completed will be implemented at all locations. This
initiative is expected to result in improved patient care and the
supervision of the residential units.
NALOXONE KITS AS A HIGH PRIORITY
Senator Baldwin. I want to just briefly pivot to the
related issue of over reliance on opioids, and I appreciated
Senator Moore Capito talking about the bill we have worked
jointly together named in honor of a marine veteran in
Wisconsin, Jason Simcakoski, who died at a VA hospital in
Tomah.
You may recall that the inspector general report released
last August detailing his death from mixed drug toxicity
revealed that antidotes to overdose, like naloxone and
flumazenil, were not available on the emergency crash carts
that were brought to Jason's room, and that a facility staff
member was tasked with securing an antidote from the urgent
care clinic, and then it arrived in his room some 33 minutes
later after he was found unresponsive.
So I understand that the availability of naloxone and
related antidotes are tremendously important. They can and do
save lives. That leads me to the VA's legislative proposal to
eliminate co-pay requirements for naloxone kits it distributes
to high-risk veterans. Since its implementation more than 2
years ago, they have been extensively distributed, and lives
have been saved.
But I also know, and you know, that the recently signed
Omnibus Appropriations Bill and the Jason Simcakoski Memorial
Act that I referred to would expand the VA's overdose education
and naloxone distribution program to ensure that every VA
medical facility and pharmacy is equipped with opioid receptor
antagonists such as naloxone.
I want you to please to speak to why providing these kits
free of charge is such a high priority.
Dr. Shulkin. Yes. Well, I think you have said it very well,
Senator, which is that in the case of overdose, these are
lifesaving drugs. I have personally used them, and people go
from being essentially unconscious to waking up and talking to
you in a matter of seconds. And so, if you do not take the
right actions, they stop breathing, and obviously they can die.
So I could not agree with you more. Having these available,
much like years ago we did with the automatic implantable
defibrillators that you see now in waiting rooms, and airports,
and restaurants. VA has been distributing these kits out to
community partners in various areas. We have been doing it by
the thousands and successfully. I think that getting more of
them out will be helpful.
Last year we prescribed 18,000 prescriptions for naloxone.
I think you mentioned the issue of co-pays. Fifty percent of
them required a co-pay. Eight dollars is our average co-pay. So
anything that we can do to help eliminate barriers to the use
of these drugs I think would be important, and education is a
primary target of ours as well.
Senator Baldwin. Thank you. And, Mr. Chairman and Ranking
Member, I will submit some additional questions for the record.
I thank you for the time.
HEPATITIS C DRUG TREATMENT
Senator Kirk. With your indulgence, I will go with a second
round here. Let me get you on the record about hepatitis C.
Last year the subcommittee appropriated $1.5 billion for
treatment of hepatitis C. We have also appropriated another
$1.5 billion for advance appropriations in 2017 for the
treatment of hepatitis C, which should be a good news story.
There are dramatically different figures put out by you and the
Department about how many new patients starts will be achieved
in this fiscal year on hepatitis C.
I would like to see how many do you project will be started
in fiscal year 2016.
Dr. Shulkin. Yes. Well, first of all, I could not agree
more. We thank you for your leadership in providing this to
veterans. This is one of those miracle drugs that have come
through----
Senator Kirk. I would say this is a chance for us to have a
hepatitis C free veteran population.
Dr. Shulkin. Yes, absolutely.
Senator Kirk. Probably the best legacy for the President on
his way out of office.
Dr. Shulkin. Well, with a 95 percent cure rate, I am not
sure that you can do that many things this well, so thank you
again for that support.
Let me go over the numbers. There should not be any
confusion about this. VA estimates, using its databases, that
we have 120,000 veterans who have hepatitis C. You can measure
hepatitis C in the blood. We were originally given the $1.5
billion and, given our pricing for hepatitis C drugs, able to
treat this year 35,000 veterans. However, the price of the drug
has dropped.
Senator Kirk. They have to go through a course as I
remember, and for those 35,000 new starts----
Dr. Shulkin. It's a series of treatments, yes.
Senator Kirk [continuing]. We would then expect a 97-
percent success rate with the new starts.
Dr. Shulkin. I think--I think that is pretty good. But the
reason why there may be some confusion, we have had additional
good news, and that is the pricing on this drug has dropped.
That means we are going to be able to treat more veterans this
year. So instead of 35,000, we potentially--potentially--could
treat 70,000. That means that if you were able to treat 70,000
veterans and you only have 120,000, we could actually eliminate
or cure those that have hepatitis C today because new veterans
will enter the system----
Senator Kirk. Right.
Dr. Shulkin [continuing]. In approximately 2 years. What
a--what a great story. This would be a miracle and, frankly, a
great thing to do for veterans.
The reason why my staff may be using a different number
than the 70,000 is that this is the potential. To get 70,000
veterans through the VA to screen them, to make sure they are
appropriate to put them through all these treatments, that
would require us right now given where we are in fiscal year
2016 already, we have treated 9,100 patients this year in
fiscal year 2016, to do 2,000 starts per week.
We have once done that in a week in September of 2015 when
we went through extraordinary efforts right before the budget
year ended to get as many veterans in to spend last year's $1.5
billion. But maintaining 2,000 veterans a week for the rest of
the year, frankly is not going to be practical given our
current resources.
So what we are looking to do is to ask for some flexibility
in the $1.5 billion, 5 percent of it, to actually increase our
staffing in these clinics so we can bring through 2,000
veterans a week. So if we can actually staff up a tiny bit in
these hepatology clinics, these hepatitis C clinics, that would
be our goal in 2 years to essentially eliminate this from the
VA system.
It is going to take an effort operationally to catch up.
Right now we are very comfortable that our staffing levels are
doing about 1,300 starts a week, okay? That is really our
capacity given our current staffing that we could sustain. That
would get us part way towards that number. It would get us, you
know, in the 40- to 50,000 a year, and, frankly, we are going
to do everything we can to treat every veteran with hepatitis
C.
OVER PRESCRIPTION OF OPIOIDS
Senator Kirk. Good. Could I divert from you to what I have
noticed is what I would call a VA way of practicing medicine.
This has happened in my own family where it seems like--you
already described the over prescription and ways to deal with
opioids. Last night the Senate passed the Kirk amendment that
would bring the VA into the reporting system that we created
under the legislation to make sure that we are going downward
on over prescription.
In my experience, the over prescription has been Xanax and
Ambien, too much of that where you develop a real dependency.
Is there a way that we can make sure that with psychotropic
drugs that we are doing less and less and less of that just to
get the patient out of the door?
Dr. Shulkin. Yeah, actually VA does have measures on this.
I do not have the statistics off the top of my head, but we not
only know how many patients are on benzodiazepines, but
actually the combination between benzodiazepines and opioids.
And we have targeted that as a high-risk sort of high-alert
area.
Senator Kirk. Just see if it is part of socialized medicine
to get the patient quickly out the door to give them Xanax and
Ambien in nearly unlimited quantities. I would note that
Senator Baldwin has talked about the Tomah facility----
Dr. Shulkin. Yes.
Senator Kirk [continuing]. Which was called the candy
factory because so much was over prescribed there.
Dr. Shulkin. Yes. Yes. So I think we recognize this is a
challenge. That is why we are doing so much provider and
mandatory training on this, something that I think that we are
looking to make significant progress on. Thank you.
Senator Kirk. Mr. Tester, any final words?
VHA 2018 ADVANCE REQUEST
Senator Tester. I do. Thank you, Mr. Chairman. I want to
drill down a little bit on the numbers, particularly with the
2018 advance request. I do not see any of the annualized costs
for the new doctors and nurses that are going to be hired with
the Choice Act funding. Now, you are going to get another bite
at the apple next year as far as fiscal year 2018 goes. But
does this not leave a huge hole in your future budget?
Dr. Shulkin. It does. I think you are correct. There is no
continued funding in fiscal year 2018 for these new hires. And
I would also add there are some other components, such as our
graduate medical education residents. The 5,000 residents that
were granted, they also did not continue. And so, and there are
actually some other components. But I am going to ask the
expert on this to just clarify exactly what you are asking
about, Senator.
Senator Tester. Yes.
Mr. Yow. Yes, sir. We would need about $1.3 billion to
continue the hires in fiscal year 2018.
Senator Tester. Yeah.
Mr. Yow. We would need about $280 million to continue
leases that were funded with VACCA section 801 funding, and we
need about $90 million to continue the residents that were
hired under section 301 of VACCA.
Senator Tester. Okay. I got it, and I appreciate your
frankness. $1.3 billion, $280 million, $90 million for the
residency. This is going to leave a hell of a hole, guys. I
mean, why are we putting an emphasis on getting healthcare
providers across the system, urban and rural areas. We are
going to be laying these folks off.
Dr. Shulkin. Well, the advance appropriation is to be able
to supply us with a stable amount of money going forward, but
there has to be a second step, as you mentioned, Senator, for
us to identify what our actual needs are. Now, with the new
Veterans Choice Program, what we are trying to understand is
what those exact numbers are so we can come back and talk about
that.
VA AND DOD JOINT ELECTRONIC HEALTH RECORD
Senator Tester. Okay. I gotcha, and I just want to tell you
that from my perspective, if you need $1.3 billion for the new
hires that we are hiring and it is not in the budget for 2018,
we are not doing our job, I will just tell you that. I mean, it
becomes a problem. And the worst thing that could happen, and
by the way, it would hurt for recruitment, is hire these folks
and then not keep them around. I want to talk about IT for a
second, but we really do need to get that fixed if we could.
The IT, I mean, we have included language in the omnibus
requiring the VA to develop and submit to this subcommittee a
detailed plan on how to replace or fix the IT. I know you do
not lead the IT team over at VA, by the way.
Dr. Shulkin. No, I do not.
Senator Tester. But I do know that you have probably been
involved in these discussions.
Dr. Shulkin. Yes.
Senator Tester. Why is it taking so long to fix this
system?
Dr. Shulkin. That is one that I would be glad to defer to
Laverne Council, who ably leads our IT Department. I have a
great deal of confidence in her. She has gone in like you would
want with her private sector background, and really challenged
all of the assumptions that frankly have led to an
underperforming part of the organization. And so, Laverne, I am
sure when we come back to talk to you March 10th or 11th--I
forget the specific day--would be glad to address that in a
very clear way.
Senator Tester. That would be good because, I mean, I think
it has been 10 years ago----
Senator Kirk. Remind him we are going to do a hearing on
the joint records April 14th----
Dr. Shulkin. Okay.
Senator Kirk [continuing]. And would want your best
possible details on that for the subcommittee.
Dr. Shulkin. Absolutely. We will be prepared.
Senator Kirk. I have been holding back as prerogative as
chairman to tell you what my IT program would be to make sure
that we would require all narratives in the Microsoft world and
all documents in .jpg to make sure there was complete usability
for everybody in the industry.
Dr. Shulkin. Okay.
Senator Kirk. And make sure that we do not have a separate
beltway bandit code. And when I talked about this with
Secretary Shinseki, wanting to make sure that everything was
open code based on the success that Motorola has had with the
Android system when they made Android all open code, and got
70,000 apps to that system. My hope is eventually if we take
25, 27 million patients in DOD and VA with an open code system
will establish the medical records technologies, undeniably
American. And an entire industry will always--worldwide will be
here. And that is my hope that we do not let an individual
beltway bandit create their own code.
Dr. Shulkin. Okay. Well, thank you. Thank you for giving us
a little insight as to what your approach is on that. Thank
you.
Senator Tester. So when the hearing comes around, you said
on April 14th? Is that correct?
Senator Kirk. April 14th, right.
Senator Tester. April 14th, it would be great to know where
we are as far as the status for replacing or modernizing that
system. It would be great to know what the cost estimates are
for that replacement.
Dr. Shulkin. Absolutely.
Senator Tester. So that it is. I just want to thank you all
for being here. It is a bit of mental gymnastics for you guys,
and I appreciate your professionalism, and I appreciate your
honesty. And I look forward to working with you as I know
others on this subcommittee do to making sure that we meet the
needs of our veterans. Thank you.
Dr. Shulkin. Thank you.
Senator Kirk. Let us--we have beat you up enough here--
close. I want to thank our witnesses, especially my partner,
Senator Tester.
And the record will be open until the close of business
next week, Thursday, so that members can submit questions for
the record.
SUBCOMMITTEE RECESS
Senator Kirk. The next hearing of the subcommittee will be
on Thursday, March 10.
Dr. Shulkin. That is better than 1:00 a.m.
Senator Kirk. Better than 1:00 a.m.
Dr. Shulkin. Yeah. Yeah.
Senator Tester. Thank you, Mr. Chairman.
Dr. Shulkin. Thank you.
Senator Kirk. And we will stand adjourned.
Senator Tester. Thanks, Kirk.
[Whereupon, at 12:34 p.m., Thursday, March 3, the
subcommittee was recessed, to reconvene Thursday, March 10, at
a time subject to the call of the Chair.]
MILITARY CONSTRUCTION, VETERANS AFFAIRS, AND RELATED AGENCIES
APPROPRIATIONS FOR FISCAL YEAR 2017
----------
THURSDAY, MARCH 10, 2016
U.S. Senate,
Subcommittee of the Committee on Appropriations,
Washington, DC.
The subcommittee met at 11:05 a.m., in room SD-124, Dirksen
Senate Office Building, Hon. Mark Kirk (chairman) presiding.
Present: Senators Kirk, Murkowski, Hoeven, Collins,
Boozman, Capito, Cassidy, Tester, Udall, Schatz, and Baldwin.
DEPARTMENT OF VETERANS AFFAIRS
STATEMENT OF HON. ROBERT A. MCDONALD, SECRETARY
ACCOMPANIED BY:
HON. DAVID J. SHULKIN, M.D., UNDER SECRETARY FOR HEALTH,
VETERANS HEALTH ADMINISTRATION
DANNY G.I. PUMMILL, ACTING UNDER SECRETARY FOR BENEFITS,
VETERANS BENEFITS ADMINISTRATION
OPENING STATEMENT OF SENATOR MARK KIRK
Senator Kirk. The subcommittee will come to order. Good
morning. This is the subcommittee's second hearing on the
fiscal year 2017 and fiscal year 2018 advance budget request.
The President has requested over $78 billion in
discretionary funding for the Department of Veterans Affairs
(VA), an increase of 4.9 percent. This year, there was a
request for $104 billion in advance mandatory benefits funding.
This subcommittee of this Congress has given you everything
you wanted, and more. The answer to every VA problem is not
``give us more money, give us more flexibility.'' We need to
fix the VA's corrupt culture and all too often poor
performance.
We also need to talk about accountability and veterans
first and not bureaucrats.
Mr. Secretary, I understand that you will be visiting
Illinois next week while in Chicago. I hope you will notice the
difference in the culture at a facility that combines the
military's healthcare standards with veterans' care.
I want to recognize my friend, the Senator from the Big
Sandy metroplex in Montana, Mr. Tester.
STATEMENT OF SENATOR JON TESTER
Senator Tester. Thank you, Chairman Kirk. Thank you for
holding this hearing on the VA's budget.
Secretary McDonald, it is great to have you here today,
with your team. Thank you for your service to the veterans of
this country.
Last week, we heard testimony from Dr. Shulkin and Mr.
Pummill about VA and the Veterans Benefits Administration's
(VBA) budget request. I look forward to continuing that
discussion today.
As you know, one of my top concerns continues to be the
long wait times for veterans trying to get the healthcare
through the Choice program. You and I, Mr. Secretary, have had
numerous discussions about the failures of the Choice program
in my home State. Some of the fault lies with the VA, some lies
with Congress. As I said last week, a lot of lies with the
third-party administrator in Montana. What they have done and
what they are doing is completely unacceptable.
I know time is tight today, so I am not going to rehash the
litany of complaints that I receive on a daily basis from
frustrated veterans. I know these issues are not isolated to
Montana. They are in other States, including Senator Collins'
State of Maine.
I do not have to tell you the frustrations are growing up
here. I know you hear them. I know you share them. The bottom
line is the Choice program is broken. We need to fix it, and we
need to fix it as soon as possible.
That is why I introduced legislation last week that will
fix the issues we are having with Choice. Moving forward, it
will put in place a less complex and confusing framework for
Care in the Community. That will reduce administrative burdens
both for community providers and for the VA, and connect
veterans to the care they need in a more timely manner, and
more streamlined.
Earlier this week, I met with Chairman Isakson, who is
chairman of the Senate Veterans' Affairs Committee on this
issue. We share the same goals and we share the same concerns.
We are now committed to finding a bipartisan solution to
address these problems in a comprehensive manner.
Mr. Secretary, I hope we can enlist your effort in that
regard. When all is said and done, we have to get it right. Our
veterans deserve nothing less.
With regard to your budget request, as I see it, there are
some very good things in it, but there are also some things
that need further explanation.
Failure to account for sustained costs of doctors and
nurses that we have hired with Choice Act funds is one. The
overall reduction in capital budget is yet another.
I look forward to addressing these issues and other issues
with you today and in the weeks ahead. Again, I want to thank
you for your service. Thank you for being here today.
Thank you, Mr. Chairman.
Senator Kirk. Thank you.
I want to welcome our witnesses. Secretary McDonald is a
graduate of West Point and the Secretary of Veterans Affairs.
He is accompanied by Dr. David Shulkin, the Under Secretary for
Health, and Mr. Danny Pummill, the Acting Under Secretary for
Benefits. I welcome you both back to the subcommittee. Welcome,
gentlemen.
SUMMARY STATEMENT OF HON. ROBERT A. MCDONALD
Secretary McDonald. Chairman Kirk, Ranking Member Tester,
members of the subcommittee, thanks for the opportunity to
present the President's 2017 budget and 2018 advance
appropriations request for the Department of Veterans Affairs.
I have submitted a written statement for the record.
The President's 2017 budget proposal is another tangible
sign of his devotion to veterans and their families. It
proposes $182.3 billion for the department in fiscal year 2017,
which includes $78.7 billion in discretionary funding, a 4.9-
percent increase above the 2016 enacted level, largely for
healthcare. It includes $65 billion for medical care, a 6.3-
percent increase of $3.9 billion over 2016's enacted level. It
includes $12.2 billion for Care in the Community and the new
Medical Community Care budget account to increase transparency
on VA spending for non-VA care, as required in the VA budget
and Choice Improvement Act. It provides $66.4 billion in
advance appropriations for VA medical care programs in 2018, a
2.1 percent increase above the 2017 request. It provides $7.8
billion for mental health. It funds veteran contact centers,
and it funds veteran crisis line modernization.
This proposal provides $1.5 billion for effective hepatitis
C treatments for at least 35,000 veterans, but perhaps
significantly more depending upon the pricing of the drugs.
It provides $1.2 billion for telehealth access, $725
million for veteran caregivers, and $515 million for health
programs for women veterans.
The proposal includes $103.6 billion in mandatory funding
for veteran benefit programs in 2017 and $103.9 billion in
advance appropriations for our three major mandatory Veteran
Benefits Accounts.
It requests $2.8 billion for the Veterans Benefits
Administration, including support for an additional 300 staff
to reduce the nonrating claim inventory and provide veterans
with more timely decisions on nonrating claims.
And it includes $156.1 million for the Board of Veterans
Appeals, an increase of 42 percent over the 2016 level. This is
a down payment on a long-term, sustainable plan to eliminate
the appeals backlog.
The budget supports the VA's four agency priority goals. It
supports our five MyVA transformational objectives to improve
the veteran experience, to improve the employee experience, to
improve internal support services, to establish a culture of
continuous improvement, and to expand strategic partnerships.
It provides $2.6 million for the MyVA program office to
help integrate MyVA initiatives across the enterprise, and
$72.6 million for the Veterans Experience Office, so we can
continue establishing high customer service standards.
And it supports our 12 breakthrough priorities for 2016 and
fiscal year 2017. These are critical investments, if we are
serious about transforming VA into the high-performing
organization veterans deserve and taxpayers expect.
Over 3 decades in the private sector, I learned first-hand
what it takes to be a high-performance organization, and that
goal is within our reach. We already have a clear purpose and
strong values and strong strategies. We have a growing team of
talented business and healthcare professionals making
innovative changes. Ten of our top 16 executives are new since
I became Secretary, and we are building responsive systems and
processes shaped by design to meet veterans' needs.
For veterans, that means they have 24/7 access to VA
systems and know where to get answers. Veterans calling or
visiting primary care facilities at a medical center have
clinical needs addressed the same day. Veterans engaged in
mental healthcare needing urgent attention speak to a provider
the same day. And veterans calling for a new mental health
appointment receive suicide risk assessments and immediate
care, if needed.
For employees serving veterans, it means training on
advanced business techniques that drive responsive and
innovative change. It means clear performance expectations,
continuous feedback, and performance management systems that
encourage continuous improvement and excellence.
It means that executive performance ratings and bonuses
reflect actual performance and relevant inputs like veteran
outcomes, employee surveys, and 360-degree feedback. And it
means modern, automated systems in place of antiquated and
costly paper processes.
We are advancing along all of these lines and many others.
Growing a high-performing culture is what our Leaders
Developing Leaders (LDL) program is all about. Leaders
Developing Leaders is a continuous, enterprise-wide process to
instill lasting change.
We launched LDL last November with 450 senior field
leaders, and we have trained more than 5,000 leaders so far. We
met again last week to build on growing momentum and share best
practices that we will leverage across the VA. By year's end,
we will have over 12,000 senior leaders empowering more and
more teams to dramatically improve care and service delivery to
veterans.
Private sector experts are teaching cutting-edge business
skills like Lean Six Sigma and Human Centered Design. Human
Centered Design and Lean are helping leaders reshape the
compensation and pension exam that veterans find burdensome.
We are planning to automate performance management to
streamline the process and improve rating accuracy. And we are
finding new ways to provide higher quality care and benefits
more efficiently.
Our pharmacy benefits management program avoided $4.2
billion in unnecessary drug expenditures last year. We have
saved over $500 million in travel spending since 2013,
exceeding goals of the President's campaign to cut waste.
We have reduced employee award spending $150 million, and
Senior Executive Service (SES) bonuses 64 percent between 2011
and 2015 by rigorously linking awards to performance.
Since 2011, we have saved $16.6 million using more
efficient training and meeting methods. We have already saved
$10 million a year under the MyVA five district structure that
we announced in January 2015.
We saved approximately $5.5 million from 2011 to 2015 by
strengthening controls over permanent change of station moves.
And we will save millions each year in paper storage since we
implemented electronic claims processing.
So we are committed to doing everything we can for veterans
with everything we are given.
But more than 100 legislative proposals for meaningful
change require congressional action. Over 40 are new this year,
some absolutely critical to maintaining our ability to purchase
non-VA care.
To best serve veterans, we need your help streamlining VA's
Care in the Community systems and programs. We have to
modernize and clarify VA's purchase care authorities to
preserve the veterans' access to timely community care
everywhere in the country.
Above all, this needs to be done in this Congress. I have
consistently identified it as a top legislative priority. We
provided detailed legislation addressing this challenge over 9
months ago. Members of this Committee and others in Congress
have introduced legislation to address these issues. Now we
look forward to working with you to ensure we get this right.
The budget proposes a simplified, streamlined, and fair
appeals process, so that in 5 years, veterans could have
appeals resolved within 1 year of filing. The statutory appeals
process is archaic and unresponsive, not serving veterans well.
Last year, the board was still adjudicating an appeal that
originated 25 years ago and had been decided more than 27
times.
Legislating a simplified process can save over $139 million
annually beginning in 2022.
We compete with the private sector for talent, especially
in healthcare, so we are proposing flexibility on the 80-hour
pay period maximum for certain medical professionals and
critical compensation reforms for network and hospital
directors.
Likewise, we are looking at how we can treat our career
executives more like their private sector counterparts, and we
are working with our stakeholders to shape a plan that best
serves veterans.
The budget proposes appropriations language for general
transfer authority that allows me some measured spending
flexibility to respond to veterans' emerging needs.
We need congressional authorization for 18 leases submitted
in the VA's 2015 fiscal year and 2016 budget request. We need
authorization for eight major construction projects included in
VA's 2016 fiscal year request. And we need support for the six
additional replacement major medical facility leases in the
2017 budget. And passing special legislation for VA's West Los
Angeles campus will get positive results for veterans there who
are most in need.
This Congress with today's VA leadership team can make
these changes and more. And it is all for veterans. Then we can
look back on this year as the year that we turned the corner.
I appreciate this opportunity and the support you have
shown veterans, the department, and the MyVA transformation,
and I look forward to answering your questions.
Thank you, Mr. Chairman.
[The statement follows:]
Prepared Statement of Hon. Robert A. McDonald
Good morning, Chairman Kirk, Ranking Member Tester, and
distinguished members of the Senate Appropriations Subcommittee on
Military Construction and Veterans Affairs. Thank you for the
opportunity to present the President's 2017 budget and 2018 advance
appropriations (AA) requests for the Department of Veterans Affairs
(VA). This budget continues the President's faithful support of
veterans and their families and survivors, and it sustains VA's
historic transformation. It will provide the funding needed to enhance
services to veterans in the short term, while strengthening the
transformation of VA that will better serve veterans in the future.
a vision for the future
VA's vision for the future is to be the No. 1 customer-service
agency in the Federal Government. The American Customer Satisfaction
Index already rates our National Cemetery Administration No. 1 with
respect to customer service. In addition, for the sixth year in a row,
VA's Consolidated Mail Outpatient Pharmacy received J.D. Power's
highest customer satisfaction score among the Nation's public and
private mail-order pharmacies. These are compelling examples of
excellence. We aim to make that so for all of VA.
We are transforming the entire Department, not just making
incremental changes to parts of it. We began in July 2014 by
immediately reinforcing the importance of our inspiring mission--caring
for those ``who shall have borne the battle,'' their families, and
their survivors. Then, we re-emphasized our commitment to our
exceptional I-CARE Values--Integrity, Commitment, Advocacy, Respect,
and Excellence. To provide timely quality care and benefits for
veterans, everything we are doing is built, and must be built, on the
rock-solid foundation of mission and values.
MyVA is the catalyst making VA a world-class service provider. It
is a framework for modernizing VA's culture, processes, and
capabilities so we put the needs, expectations, and interests of
veterans and their families first, and put veterans in control of how,
when, and where they wish to be served.
Listening to others' perspectives and insights has been, and
remains, instrumental in shaping our transformation. We have taken
advantage of an unprecedented level of outreach to the field and our
stakeholders. In my first months as Secretary, I assessed VA and
recognized that we would need to change fundamental aspects of every
part of VA in order to rise to excellence. I shared my assessment's
results with President Obama and received his guidance. I discussed my
findings with you and other Members of Congress--privately and during
hearings. And I consulted with literally thousands of veterans, VA
clinicians, VA employees, and Veteran Service Organizations (VSOs) and
other stakeholders in dozens of meetings.
Since my July 29, 2014, confirmation, I have made 277 visits to VA
field sites in more than 100 cities, including 47 visits to VA Medical
Centers, 30 visits to homeless veterans program sites, 16 visits to
Community Based Outpatient Clinics, 15 Regional Offices, and 9
Cemeteries. I have attended 61 veteran engagements through public and
private partnerships and 60 stakeholder events to hear firsthand the
problems and concerns impacting our veterans. To recruit individuals to
work for VA as medical professionals and in other critical fields, I
have visited 50 medical schools, universities, and other educational
institutions. This kind of outreach, partnership, and collaboration
underpins our department-wide transformation to change VA's culture and
make the veteran the center of everything we do.
Progress
Transforming an organization of VA's size is an enormous
undertaking. It will not happen overnight. But we are now running the
Government's second largest Department like a $166 billion Fortune 6
organization should be run. That is, balancing near term performance
improvements while rebuilding VA's long-term organizational health.
Effective change often requires new leadership, and we have made
broad changes. Of our top 16 executives, 10 are new to their positions
since I became Secretary. Our team today includes extensive executive
expertise from the private sector: a former banking industry Chief
Financial Officer and President of the USO; the former Chief Executive
Officer of Beth Israel Medical Center in New York City and Morristown
Medical Center in New Jersey; a former Chief Executive of Jollibee
Foods and President of McDonald's Europe; a former Chief Information
Officer of Johnson & Johnson and Dell Inc.; a former partner in
McKinsey & Company's Transformational Change and Operations
Transformation Practices; a retired partner in Accenture's Federal
Services Practice; a former Chief Customer Officer for the City of
Philadelphia who previously spent 10 years at United Services
Association of America (USAA), one of the best and foremost customer-
service organizations in the country; a former entrepreneur and CEO of
multiple technology companies; and a retired Disney executive who spent
2010-2011 at Walter Reed National Military Medical Center enhancing the
patient experience.
Most members of the executive leadership team are veterans
themselves. They have served from Vietnam to Iraq and Afghanistan, and
each is here because he or she demonstrates a personal commitment to
our mission. These fresh, diverse perspectives, combined with our more
experienced government and healthcare executives, will continue to
catalyze innovation and change.
Thanks to the continuing support of Congress, VSOs, union leaders,
our dedicated employees, states, and private industry partners, we have
made tremendous headway over the past 18 months. In 2015, we made
notable progress building the momentum that will begin delivering
transformational changes that VA needs.
Congress has passed key legislation--such as the Veterans Access,
Choice, and Accountability Act and the Clay Hunt Suicide Prevention for
American Veterans Act--that gives VA more flexibility to improve our
culture and ability to execute effectively.
Consistent with the culture of a High Performance Organization that
serves veterans and their families, we have turned VA's structural
pyramid upside down. Veterans and their families are at the top. The
Office of the Secretary is at the bottom, supporting subordinate
leaders and the workforce who are serving veterans. This method of
thinking and operating is a reminder to all employees and stakeholders
that we are here to support our veterans, not our bosses.
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While reinforcing our I-CARE Values, we are transitioning from a
rules-based culture that may neglect the human dimension of service to
a principles-based culture grounded in values, sound judgment, and the
courage and opportunity ``to choose the harder right instead of the
easier wrong. . . .''
We formed a MyVA Advisory Committee (MVAC) to advise us on our
transformation. The MVAC is comprised of a diverse group of business
leaders, medical professionals, experienced government executives, and
veteran advocates. The Chairman is retired Major General Joe Robles,
former Chairman and CEO of USAA. The Vice Chairman is Dr. J. Michael
Haynie, Air Force veteran, Vice Chancellor of Syracuse University and
founder of the Institute for Veteran and Military Families (IVMF). The
MVAC includes executives with deep customer service and transformation
expertise from organizations such as Amazon, The Cleveland Clinic,
McKinsey & Company, Johns Hopkins, Mayo Clinic, as well as a former
Surgeon General, a former White House doctor for three US Presidents, a
university president who was a Rhodes Scholar from the Air Force
Academy who currently serves as a reserve Air Force Lieutenant Colonel,
and advocates for both the traditional VSOs and post-9/11 veterans'
organizations.
Private sector leadership experts are bringing cutting-edge
business skills and developing VA teams in new ways. We are training
critical pockets of our workforce on advanced techniques like Lean and
Human Centered Design. For example, working with the University of
Michigan, we have already trained more than 5,000 senior leaders across
the Nation in our ``Leaders Developing Leaders.'' The Veterans Benefits
Administration (VBA), Veterans Health Administration (VHA), and our
Veterans Experience team collaborated using Human Centered Design and
Lean techniques to redesign the Compensation and Pension Examination
(C&P Exam) process because we received consistent feedback that the
process--often, a veteran's first impression of the VA when separating
from service--can be a confusing and uncomfortable experience.
Across VA, we are encouraging different perspectives and listening
to all of our key stakeholders, even those who are critical of VA. To
benchmark and capture ideas and best practices along our transformation
journey, we have been working collaboratively with world-class
institutions like Procter & Gamble, USAA, Cleveland Clinic, Wegmans,
Starbucks, Disney, Marriott and Ritz-Carlton, NASA, Kaiser Permanente,
Hospital Corporation of America, Virginia Mason, DOD, and GSA, among
others.
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VA named the Department's first Chief Veteran Experience Officer
and began staffing the office that will work with the field to
establish customer service standards, spread best practices, and train
our employees on advanced business skills.
Rather than asking veterans to navigate our complicated internal
structure, we are redesigning functions and processes to fit veteran
needs in the spirit of General Omar Bradley's 1947 proposition that
``We are dealing with veterans, not procedures; with their problems,
not ours.''
We are realigning VA to facilitate internal coordination and
collaboration among business lines--from nine disjointed, disparate
organizational boundaries and organizational structures to a single
framework. That means down-sizing from 21 service networks to 18 that
are aligned in five districts and defined by State boundaries, except
in California. This realignment means opportunities for local level
integration, and it promotes consistently effective customer service.
Veterans from Florida to California, Puerto Rico to Maine, Alaska and
Guam, and all parts in between, will see one VA.
We have developed a multi-year plan for creating a world-class
Information Technology organization, and on November 11, Veterans Day,
we launched the Vets.gov initial capability. Developed with support
from the U.S. Digital Services Team and informed by extensive feedback
from veterans, Vets.gov is a modern, mobile-first, cloud-based website
that will replace numerous other websites and website logins with a
single, easy to navigate location. The website puts veteran needs and
wishes first, and we will continue to add the capability that's
required to improve its accessibility and usefulness. As Vets.gov
evolves, it will simplify the veteran experience by re-using and making
consistent veteran information, including mailing address and phone
number, across the agency.
At VA, we know that serving veterans is a collaborative exercise,
so we will not function in a vacuum. We are operating as part of a
community of care, forming strategic partnerships with external
organizations to leverage the goodwill, resources, and expertise of
valuable partners to better serve our Nation's veterans and help
address a wide variety of veteran needs, including employment,
homelessness, wellness, and mental health. Partners include respected
organizations like the YMCA, the Elks, the PenFed Foundation, LinkedIn,
Coursera, Google, Walgreens, academic institutions, other Federal
agencies, and many more. These partnerships reflect our commitment to
re-thinking how VA does business so we can leverage the strengths of
others who also care for veterans.
We have enabled 39 Community Veterans Engagement Boards, a national
network designed to leverage all community assets, not just VA assets,
to meet local veteran needs. Sixteen more communities are in
development right now.
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We have renewed and redefined working relationships with our union
partners, and union leaders are part of the team, and have had
significant input into MyVA. We continue to work with them to address
issues and make sure our employees are involved often and early in
every major decision.
We are continuing to develop a robust provider network while we
streamline business processes and re-imagine how we obtain services
such as billing, reimbursement credentialing, and information sharing.
We continue to listen, learn, and grow.
va's agency priority goals
In 2015, we were guided by and made notable progress toward
reaching our three Agency Priority Goals (APGs)--(1) Improve Veteran
Access to VA Benefits and Services, (2) End Veteran Homelessness, and
(3) Eliminate the Disability Claims Backlog. These accomplishments
toward achieving our APGs demonstrate VA's commitment to using our
resources effectively to improve care and benefits for veterans.
Access
We expanded capacity by focusing on staffing, space, productivity,
and VA Community Care.
Since discovering the access challenges in Phoenix, Arizona, we
have aggressively improved access to care, not just in Phoenix but
across VA as a whole. For instance, in the first 12 months after
discovering the Phoenix appointment problem, from June 2014 to June
2015, we completed 7 million more appointments than during the same
period the year prior: 2.5 million of those appointments were at VA;
4.5 million appointments were in the community. Altogether in fiscal
year 2015, we completed 56.7 million appointments, nearly 2 million
more than in fiscal year 2014. More than 97 percent (55 million) of
those 56.7 million appointments were completed within 30 days of the
clinically indicated or veteran's preferred date, an increase of 1.4
million over the fiscal year 2014 numbers.
Veteran access is one of the five critical priorities supporting VA
healthcare transformation with far-reaching impact across VA that Under
Secretary for Health, Dr. David J. Shulkin announced in September 2015.
With the Access Stand Downs, VHA is empowering each facility to focus
on the needs of its specific population and refocusing people, tools,
and systems on a journey of continuous improvement towards same-day
access for primary care and urgent specialty care. The immediate goal
is that no patients with urgent appointment requests in VA clinics with
the most critical clinical needs, such as cardiology, urology, and
mental health, are waiting more than 30 days.
From November 9, through November 13, 2015, VHA conducted a
complete review of all veterans waiting for appointments--with a focus
on those veterans waiting for clinically important and acute services--
to ensure that the wait was clinically appropriate as determined by the
veteran's treatment team. This process culminated with the VHA's first-
ever Access Stand Down on November 14. The Stand Down was a nationwide
effort to ensure veterans get the right care at the right time.
In the first Access Stand Down, VHA reviewed nearly 55,800 of the
more than 56,000 urgent consults that remained open more than 30 days
(as of November 6, 2015), a herculean effort. Of those 55,800 urgent
open consults reviewed, 82 percent (45,849) were scheduled or closed by
the end of that first Stand Down.
Building on the November 14th Access Stand Down momentum and
success, VHA continued to maximize accessibility to outpatient services
with the February 27th, 2016 Access Stand Down. The February Stand Down
provided an opportunity to make another significant leap in
dramatically enhancing veterans' access to care. Clinical operations
will meet customer demand through resource-neutral, continuous
improvement at the facility-level and scaling-up excellence across the
enterprise.
VetLink data is another way we are listening to veterans. Since
September 2015, VHA has analyzed preliminary data from VetLink, our
kiosk-based software that allows us to collect real-time customer
satisfaction information. In all three separate VetLink surveys to
date--related to nearly half-a-million appointments--veterans told us
that about 90 percent of the time, they are either ``completely
satisfied'' or ``satisfied'' with getting the appointment when they
wanted it. However, about 3 percent of veterans who participated in the
survey were either ``dissatisfied'' or ``completely dissatisfied,'' so
we have more work to do.
Staffing. We increased net VHA staffing. In fiscal year 2015, VHA
hired 41,113 employees, for a net increase of 13,940 healthcare staff,
a 4.7 percent increase overall. That increase included 1,337 physicians
and 3,612 nurses, and we filled several critical leadership positions,
including the Under Secretary of Health.
Space. We activated an additional 2.2 million square feet of
clinical space in fiscal year 2015, adding to the more than 1.7 million
square feet of clinical space activated in fiscal year 2014.
Productivity. We increased physician work Relative Value Units
(RVUs) by 9 percent from fiscal year 2014 to fiscal year 2015. VA
completed more than 1.4 million extended hour completed encounters in
primary care, mental health and specialty care in fiscal year 2014 and
more than 1.5 million in fiscal year 2015, an increase of 5.7 percent
in extended hour encounters.
Care in the Community
In 2015, VA obligated $10.5 billion for Veterans Care in the
Community, including resources provided through the Veterans Choice
Act--an increase of $2.3 billion (28 percent) over the 2014 level--
which resulted in nearly 2.4 million authorizations for veterans to
receive Care in the Community from December 3, 2014 through December 2,
2015. Programmatically, this included care in the community for
veterans' dialysis, state home programs, community nursing care,
veterans home programs, emergency care, private medical facilities
care, and care delivered at Indian health clinics. It also includes
care under VA's CHAMPVA program for certain dependents entitled to that
care.
Homelessness
Veteran homelessness has continued to decline, thanks in large part
to unprecedented partnerships and vital networks of collaborative
relationships across the Federal Government, across State and local
government, and with both non-profit and for-profit organizations.
Ending and preventing veteran homelessness is now becoming a reality in
many communities, including: the Commonwealth of Virginia; the State of
Connecticut; New Orleans, Louisiana; Houston, Texas; Las Vegas, Nevada;
Philadelphia, Pennsylvania; Syracuse, New York; Winston-Salem, North
Carolina; and Las Cruces, New Mexico. In collaboration with our Federal
and local partners, we have greatly increased access to permanent
housing; a full range of healthcare including primary care, specialty
care, and mental healthcare; employment; and benefits for homeless and
at-risk for homeless veterans and their families.
In fiscal year 2015 alone, VA provided services to more than
365,000 homeless or at-risk veterans in VHA's homeless programs. Nearly
65,000 veterans obtained permanent housing through VHA Homeless
Programs interventions, and more than 36,000 veterans and their family
members, including 6,555 children, were prevented from becoming
homeless.
Overall veteran homelessness dropped by 36 percent between 2010 and
2015, based on data collected during the annual Point-in-Time (PIT)
Count conducted on a single night in January 2015. We saw a nearly 50
percent drop in unsheltered veteran homelessness. Since 2010, more than
360,000 veterans and their family members have been permanently housed,
rapidly rehoused, or prevented from falling into homelessness.
Disability Claims Backlog
VA transitioned disability compensation claims processing from a
paper-intensive process to a fully electronic processing system; as a
result, 5,000 tons of paper per year were eliminated.
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In fiscal year 2015, VA decided a record-breaking 1.4 million
disability compensation and pension (rating) claims for veterans and
their survivors--the highest in VA history for a single year. As of
December 31, 2015, VA had driven down the disability claims backlog to
75,480, from a peak of over 611,000 in March 2013.
2016-2017 VA's Agency Priority Goals
In a collaborative, analytical process, VA has established our four
new Agency Priority Goals (APGs). In fiscal years 2016 and 2017, our
four APGs build upon and preserve progress we made in 2015. The new
APGs will help accelerate the MyVA transformation and advance our
framework for allocating resources to improve veteran outcomes. Our new
APGs are to (1) Improve Veterans Experience with VA, (2) Improve VA
Employee Experience, (3) Improve Access to Health Care as Experienced
by the veteran, and (4) Improve Dependency Claims Processing. While no
longer APGs, VA will continue to build upon the progress it has already
made related to increasing access to care and services, ending
Veterans' Homelessness and eliminating the compensation rating claims
backlog.
fiscal year 2017 budget request
Our 2017 budget requests the necessary resources to allow us to
serve the growing number of veterans who selflessly served our Nation.
The 2017 budget requests $182.3 billion for VA--$78.7 billion in
discretionary funding (including medical care collections) and $103.6
billion in mandatory funding for veterans benefit programs. The
discretionary request reflects an increase of $3.6 billion (4.9
percent) over the 2016 enacted level. The budget also requests 2018
advance appropriations (AAs) of $66.4 billion for Medical Care and
$103.9 billion for three mandatory accounts that support veterans
benefit payments (i.e., Compensation and Pensions, Readjustment
Benefits, and Insurance and Indemnities).
We value the support that Congress has demonstrated in providing
the resources needed to honor our Nation's veterans. We are seeking
your support for legislative proposals contained in the 2017 budget--
including many already awaiting congressional action--to enhance our
ability to provide veterans the benefits and services they have earned
through their service. The budget also proposes appropriations language
to provide a new General Transfer Authority that would allow VA to move
discretionary funds across line items. Flexible budget authority would
give VA greater ability to avoid artificial restrictions that impede
our delivery of care and benefits to veterans.
rising demand for va care and benefits
Veterans are demanding more services from VA than ever before. As
VA becomes more productive, the demand for benefits and services from
veterans of all eras continues to increase, and veterans' demand for
benefits has exceeded VA's capacity to meet it.
In 2014, when the Phoenix access difficulties came to light, VA had
300,000 appointments that could not be completed within 30 days of the
date the veteran needed or wanted to be seen. To meet that demand, VA
rallied to add capacity to complete 300,000 more appointments each
month, or about 3.5 million additional appointments annually.
Despite these extraordinary measures to increase capacity, VA was
unable to absorb veterans' increasing demand for healthcare. The number
of veterans waiting for appointments more than 30 days rose by about 50
percent, to roughly 450,000 between 2014 and 2015, so we are
aggressively working on innovative ways to address that challenge, and
VHA's new Access Stand Downs are central to VHA's healthcare
transformation efforts and addressing that challenge.
The trend of a growing demand for VA healthcare is fueled by more
than a decade of war, Agent Orange-related disability claims, an
unlimited claim appeal process, demographic shifts, increased medical
issues claimed, and other factors. Additionally, survival rates among
Americans who served in conflicts have increased, and more
sophisticated methods for identifying and treating veteran medical
issues continue to become available. And, VA now serves a population
that is older, has more chronic conditions, and is less able to afford
care in the private sector. Workload will continue to increase as the
military downsizes and veterans regain trust in VA.
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In 2017, the number of veterans receiving medical care at VA will
be over 6 million. VA expects to provide more than 115 million
outpatient visits in 2017, an increase of 8.4 million visits over 2016,
through both VA and Care in the Community.
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Compared to fiscal year 2009, the number of patients is projected
to increase by 22 percent by fiscal year 2017. And, as veterans see the
results of VA's transformation, we are confident that the number of
veterans utilizing VA services will continue to rise. Currently, 11
million of the 22 million veterans in this country are registered,
enrolled, or use at least one VA benefit or service.
Veterans' healthcare and benefit requirements continue to increase
decades after conflicts end, and this fact is a fundamental, long-term
challenge for VA. Forty years after the Vietnam war ended, the number
of Vietnam era veterans receiving disability compensation has not yet
peaked. VA anticipates a similar trend for Gulf war era veterans, only
26 percent of whom have been awarded disability compensation.
Today, there are an estimated 22 million veterans. The number of
veterans is projected to decline to around 15 million by 2040. However,
while the absolute number may decline, an aging veteran population
requires greater care, services, and benefits. In 2017, 46 percent (or
9.8 million) of the 22 million veteran population will be 65 years old
or older, a dramatic increase since 1975, when only 7.5 percent (or 2.2
million) of the veteran population was 65 years old or older.
While the percent of the veteran population receiving compensation
was nearly constant at 8.5 percent for more than 40 years, over the
past 15 years there has been a striking increase to 20 percent. The
total number of service-connected disabilities for veterans receiving
compensation grew from 11.8 million in 2009 to 19.7 million in 2015, an
increase of more than 67 percent in just 6 years. This dramatic growth,
combined with estimates based on historic trends, predicts an even
greater increase in claims for more benefits as veterans age and
disabilities become more acute.
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The increase in veterans receiving compensation is accompanied by a
significant increase in the average degree of disability granted to
veterans for disability compensation. For 45 years, from 1950 to 1995,
the average degree of disability held steady at 30 percent. But, since
2000, the average degree of disability has risen to 49 percent. VBA's
mandatory request for 2017 is $103.6 billion, twice the amount spent in
fiscal year 2009.
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As VA continues to improve access and quality of care, more
veterans will come to VA for more of their care. Veterans today often
choose VA for care either because of personal preference or because of
VA's economic edge. Some 78 percent of enrolled veterans at VA have
other choices like Medicare, Medicaid, Tricare, or private insurance.
Out-of-pocket cost for veterans at VA is often lower, and cost
considerations are a key factor in veterans' demand for VA healthcare.
In 2014, veteran enrollees received only 34 percent of their total
healthcare through VA, accounting for about $53 billion in 2014 costs.
Just a 1 percent increase in veteran reliance on VA healthcare will
increase costs by $1.4 billion.
productivity improvements and stewardship
The MyVA transformation will ensure VA is a sound steward of the
taxpayer dollar. We are instituting operational efficiencies, cost
savings, productivity improvements, and service innovations to support
this and future budget requests. We are assessing all aspects of VA
operations using a business lens and pursuing changes so VA will
deliver care and services more efficiently and effectively at the
highest value to veterans and taxpayers. For instance, few realize that
when it comes to the general operating expense of distributing over a
hundred-billion dollars in benefits to over 5.3 million veterans and
survivors, VBA spends only about 3 cents on the dollar. By any measure,
that's an excellent return on investment. Our Reports, Approvals,
Meetings, Measurements, and Policies (RAMMPs) process identifies
practices to streamline or, in some cases, eliminate entirely. To free
capacity and empower employees to identify counter-productive or
wasteful activities that management can eliminate, VA leaders at all
levels of the organization are using RAMMP to address opportunities for
improvement that employees have identified.
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To boost efficiency and employee productivity, VA is quickly moving
to paperless claims processing from its historically manual, paper-
intensive process. Modernizing to an electronic claims processing
system has helped VBA increase claim productivity per claims processor
by 25 percent since 2011 and medical issue productivity by 82 percent
per claims processor since 2009. This significant productivity increase
helped mitigate the effects of the 131 percent increase in workload
between 2009 and 2015, when the number of medical issues rose from 2.7
million to 6.4 million. VA's shift to electronic claims processing has
meant converting paper files to eFolders. Between 2012 and 2015, the
Veterans Claims Intake Program (VCIP) scanned nearly 6 million claims
files into veterans' eFolders in the Veterans Benefits Management
System (VBMS). VBA has removed more than 7,000 tons of claims-related
papers formerly undermining efficiency, hampering productivity, and
cluttering workspace.
In fiscal year 2015, VBA deployed its innovative Centralized Mail
Initiative to 56 regional offices (ROs) and one pension management
center (PMC). Centralized Mail reroutes inbound compensation and
pension claims-related mail directly to Claims and Evidence Intake
Centers at document conversion services vendor sites, an innovation
that improves productivity and enabled digital analysis of more than
four million mail packets. Through Centralized Mail, VBA can more
efficiently manage the claims workload, and prioritize and distribute
claims electronically across the entire RO network, maximizing
resources and improving processing timeliness.
To strengthen financial management and stewardship, in fiscal year
2015 VA launched its multi-year effort to replace VA's antiquated, 30-
year-old core Financial Management System (FMS) with a 21st century
system that will vastly improve VA financial management accuracy and
transparency. The modernization effort requires robust enterprise-wide
support across the Department. In fiscal year 2015, VA committed to
using a shared service solution and engaged the Department of
Treasury's Office of Financial Innovation and Transformation (FIT) to
pursue a Federal Shared Service Provider that leverages existing,
successful investments and infrastructure across the government and
meets our financial management system needs while supporting VA's
mission of serving veterans. VA also stood up a Program Management
Office, initially staffed with 5 FTE from existing resources to lead
and manage the effort, and identified an OIT Project Manager. VA has
worked to compile lessons-learned from other agencies engaged in this
effort and from VA's previous attempts to modernize the FMS, to ensure
the effort is successful. Tasks ahead include strategies, roadmaps, and
project plans, business process re-engineering, and engaging in
significant change management activities.
Recent challenges managing non-VA care program finances have
demonstrated the great risks and immense burden of the FMS legacy
system. FMS failure would severely impede the Department's ability to
execute its budget, pay vendors and veterans, and produce accurate
financial statements.
closing unsustainable facilities
It is well-past time to close VA's old, substandard, and
underutilized facilities. VA's 2016 budget testimony last year
explained that VA cannot be a sound steward of taxpayer resources with
the asset portfolio it carries, and each year of delay makes the
situation more costly and untenable. No sound business would carry such
a portfolio, and veterans and taxpayers deserve better.
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VA currently has 370 buildings that are fully vacant or less than
50 percent occupied, which are in excess to our needs. These vacant
buildings account for over 5.2 million square feet of unneeded space.
In addition, we have 770 buildings that are underutilized, accounting
for more than 6.3 million square feet that are candidates to be
consolidated to improve utilization and lower costs. This means we have
to maintain over 1,100 buildings and 11.5 million square feet of space
that is unneeded or underutilized--taking funding from needed veteran
services. We estimate that it costs VA $26 million annually to maintain
and operate these vacant and underutilized buildings. For example, when
attempting to demolish the vacant storage facility in Bedford,
Massachusetts, VA encountered environmental issues that prevented the
demolition, forcing VA to either pay costly remediation costs to
demolish a building we no longer need or maintain facilities such as
this across the system.
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As the veteran population has migrated, VA's capital infrastructure
has not kept pace. We continue to operate medical facilities where the
veteran population is small or shrinking. Our smallest hospitals often
do not have sufficient patient volume and complexity of care
requirements to maintain the clinical skills and competencies of
physicians and nurses.
ensuring veterans access to care
The President's 2017 budget will allow VA to operate the largest
integrated healthcare system in the country, including nearly 1,300 VA
sites of healthcare and approximately 6 million veterans receiving
care; the eleventh largest life insurance provider, covering both
active duty servicemembers and enrolled veterans; compensation and
pension benefit programs serving more than 5.3 million veterans and
survivors; education benefits to more than one million students;
vocational rehabilitation and employment benefits to more than 140,000
disabled veterans; a home mortgage program that will guarantee more
than 429,000 new home loans; and the largest national cemetery system
that leads the industry as a high-performing organization, with
projections to inter more than 132,000 veterans and family members in
2017.
The 2017 budget requests $65 billion for medical care, an increase
of $3.9 billion (6.3 percent) over the 2016 enacted level. The increase
in 2017 is driven by veterans' demand for VA healthcare as a result of
demographic factors, economic assumptions, investments in access, and
high priority investments for caregivers, new Hepatitis C treatments,
and support for Veterans Care in the Community. The 2017 request
supports programs to end and prevent veteran homelessness, invests in
strategic initiatives to improve the quality and accessibility of VA
healthcare programs, continues implementation of the Caregivers and
Veterans Omnibus Health Services Act, and provides for activation
requirements for new or replacement medical facilities. The 2017
appropriations request includes an additional $1.7 billion above the
enacted 2017 AA for veterans medical care. The request assumes
approximately $3.6 billion annually in medical collections in 2017 and
2018. For the 2018 Advance Appropriations for medical care, the current
request is $66.4 billion.
Hepatitis C Treatment
Although the Hepatitis C virus infection (HCV) takes years to
progress, it is the main cause of advanced liver disease in the United
States. Treatment of this disease remains a high priority because its
cure dramatically lowers patients' risk of liver failure, liver cancer,
and death.
VA is the largest single provider of care in the Nation for chronic
HCV, and over the next 5 years, VA will strive to provide treatment to
all veterans with HCV who are treatment candidates. For fiscal year
2017, VA is requesting $1.5 billion for the cost of Hepatitis C drugs
and clinical resources. With a budget of $1.5 billion in fiscal year
2017, VA expects to treat at least 35,000 patients with HCV; the actual
number of patients treated will depend on the cost to VA of Hepatitis C
drugs. At the beginning of fiscal year 2016, almost 120,000 veterans in
VA care were awaiting HCV treatment, of whom approximately 30,000 have
advanced liver disease.
VA successfully negotiated extremely favorable pricing for both of
the new treatments available--Harvoni and Viekira--from two different
drug manufacturers by stressing VA's proven ability to deliver market
share, VA's large HCV population, and the long-term impact that VA's
physician residency programs can have on post-residency prescribing
practices.
During fiscal year 2015, VA medical facilities treated more than
30,000 veterans for HCV with these new drugs with remarkable success,
achieving cure rates of 90 percent, similar to those seen in clinical
trials.
VA clinicians have rapidly adopted new, more effective therapies
for HCV as they have become available. New therapies are costly and
require well-trained clinical providers and support staff, presenting
resource challenges for the Department. VA will focus resources on the
sickest patients and most complex cases and continue to build capacity
for treatment through clinician training and use of telehealth
platforms. Patients with less advanced disease are being offered
treatment through the Veterans Choice program in partnership with
community HCV providers.
Care in the Community
VA is committed to providing veterans access to timely, high-
quality healthcare. The 2017 budget includes $12.2 billion for Care in
the Community and includes a new Medical Community Care budget account,
consistent with the VA Budget and Choice Improvement Act (Public Law
114-41). Of the total that will be spent on non-VA care in fiscal year
2017, $7.5 billion will be provided through a transfer of the 2017
enacted AA from the Medical Services account to the new budget account,
and $4.7 billion will be provided through the resources provided in the
Veterans Choice Act for implementation of the Veterans Choice Program.
The Choice Act increased VA's in-house capacity by funding medical
personnel growth in VA facilities and expanded eligibility for Care in
the Community to ensure access to care within 30 days and to provide
care closer to home for enrollees residing more than 40 miles from a VA
facility (the 40-mile group).
This additional capacity facilitated an increase in enrollees'
reliance on VA healthcare by more than half a percent over the level
expected in fiscal year 2015. This growth was the result of enrollees
increasing their use of VA funded healthcare versus their use of other
healthcare options (Medicare, Medicaid, commercial insurance, etc.).
The fiscal year 2015 growth in enrollee reliance was largely in
Care in the Community, with the 40-mile group generating a more
significant increase in care:
--In fiscal year 2015, enrollees' reliance on VA healthcare increased
by 0.7 percent overall. Reliance for the 40-mile group
increased by 2.8 percentage points from 32.5 percent to 35.3
percent.
--The increase in reliance was mostly driven by growth in Care in the
Community. Cost sharing levels in VA are lower than what is
typically available elsewhere, which provides an incentive for
enrollees to use VA-paid Care in the Community.
Enrollee reliance on VA healthcare is expected to continue to
increase in 2016 and beyond to service the unmet demand that the Choice
Act was enacted to address.
On October 30, 2015, VA provided Congress with a plan for the
consolidation and improvement of all purchased care programs into one
New Veterans Choice Program (New VCP). Consistent with this report, the
2017 budget includes legislative proposals to streamline and improve
VA's delivery of Community Care.
Caregiver Support Program
Caregivers give their time and love in countless behind-the-scenes
ways. Whether they are helping with transportation to and from
appointments, helping the veteran apply for benefits, or helping with
meals, bathing, clothing, medication, the spectrum of care is wide and
compassion runs deep.
The 2017 budget requests $725 million for the National Caregivers
Support Program to support nearly 36,600 caregivers, up from about
30,600 in fiscal year 2016. Funding requirements for caregivers are
driven by an increase in the eligible veteran population, with
caregiver enrollment increasing by an average of about 500 each month.
ending veteran homelessness
The ambitious goal of ending veteran homelessness has galvanized
the Federal Government and local communities to work together to solve
this important National problem. Our systems are designed to help
prevent homelessness whenever possible, and our goal is a systematic
end to homelessness, meaning that there are no veterans sleeping on our
streets and every veteran has access to permanent housing. Should
veterans become homeless or be at-risk of becoming homeless, there will
be capacity to quickly connect them to the help they need to achieve
housing stability.
The 2017 budget supports VA's commitment to ending veteran
homelessness by emphasizing rescue for those who are homeless today and
prevention for those at risk of homelessness. The 2017 budget requests
$1.6 billion for VA homeless-related programs, including case
management support for the Department of Housing and Urban Development
(HUD)-VA Supportive Housing program (HUD-VASH), the Grant and Per Diem
Program, VA justice programs, and the Supportive Services for Veteran
Families program.
In fiscal year 2015 and fiscal year 2016, VA committed more than
$1.5 billion annually to strengthen programs that prevent and end
homelessness among veterans. Communities that have reached the goal or
are close to effectively ending homelessness rely heavily on VA
targeted homeless resources. Communities that have a sustainment plan
are depending on those resources to be available as they continue to
tackle homelessness and sustain the support for veterans who have moved
into permanent housing, ensuring that they maintain housing stability
and do not fall back into homelessness.
VA will continue to advocate for its continuum of homeless services
to address the needs associated with preventing first-time
homelessness, as well as the needs of those who return to homelessness,
and focus on the root causes associated with homelessness, including
poverty, addiction, mental health, and disability.
Congress has an important role, as well, in ensuring adequate
resources to meet the needs of those most vulnerable veterans by
enacting authorizations and other legislation to provide VA with a full
complement of tools to combat homelessness--including legislation that
is a prerequisite to carry out dramatic improvements to our West Los
Angeles campus centered on the needs of veterans.
benefits programs
The 2017 budget requests $2.8 billion and 22,171 FTE for VBA
General Operating Expenses, an increase of $93.4 million (3.4 percent)
over the 2016 enacted level. The request includes an additional 300
full-time equivalent (FTE) employees for non-rating claims.
With the resources requested in the 2017 budget, VA will provide:
--Disability compensation and pension benefits for 5.3 million
veterans and survivors, totaling $86 billion;
--Vocational rehabilitation and employment benefits to nearly 141
thousand disabled veterans, totaling $1.4 billion;
--Education benefits totaling $14 billion to more than one million
veterans and family members;
--Guaranty of more than 429,000 new home loans; and
--Life insurance coverage to 1.0 million veterans, 2.2 million
servicemembers, and 2.8 million family members.
Improving the quality and timeliness of disability claim decisions
has been integral to VBA's transformation of benefits delivery. VBA
successfully streamlined a complex and paper-bound compensation claims
process and implemented people, process, and technology initiatives
necessary to optimize productivity and efficiency. In alignment with
the MyVA transformation, VBA is working to further improve its
operations with a focus on the customer experience. We are implementing
enhancements to enable integration across our programs and
organizational components, both inside and outside of VBA.
VBA has processed an unprecedented number of rating claims in
recent fiscal years (nearly 1.4 million in 2015, and more than 1
million per year for the last 6 years). However, its success has
resulted in other unmet workload demands. As VBA continues to receive
and complete more disability rating claims, the volume of non-rating
claims, appeals, and fiduciary field examinations increases
correspondingly.
--Non-rating claims. VA completed nearly 37 percent more non-rating
work in 2015 than 2013--and 15 percent more than 2014. The 2017
budget requests $29.1 million for an additional 300 non-rating
claims processors to reduce the non-rating claims inventory and
provide veterans with more timely decisions on non-rating
claims.
--Appeals. Over the last 20 years, appeal rates have continued to
hold steady at between 11 and 12 percent of completed claims.
As VBA continues to receive and complete record-breaking
numbers of disability rating claims, the volume of appeals
correspondingly increases. As of December 31, 2015, there were
more than 440,000 benefits-related appeals pending in the
Department at various stages in the multi-step appeals process,
which divides responsibility between VBA and the Board of
Veterans' Appeals (Board)--355,803 of those benefits-related
appeals are in VBA's jurisdiction and 85,682 are within the
Board's jurisdiction.
Under current law, VA appeals framework is complex, ineffective,
and opaque, and veterans wait on average 5 years for final
resolution of an appeal. The 2017 budget supports the
development of a Simplified Appeals Process to provide veterans
with a simple, fair, and streamlined appeals procedure in which
they would receive a final appeals decision within 365 days
from filing of an appeal by fiscal year 2021. The 2017 budget
provides funding to support over 900 FTE for the Board and
proposes a legislative change that will improve an outdated and
inefficient process which will benefit all veterans through
expediency and accuracy. We look forward to working with
Congress, veterans, and other stakeholders to implement
improvements.
--Fiduciary program. The fiduciary program served 29 percent more
beneficiaries in 2015 than it served in 2014. Program growth is
primarily due to an increase in the total number of individuals
receiving VA benefits and an aging population of beneficiaries.
Additionally, in 2015 the fiduciary program changed the way it
captures beneficiary population data and now reports all
beneficiaries served during the course of the fiscal year. In
2015, fiduciary personnel conducted more than 84,000 field
examinations, and VBA anticipates field examination
requirements will exceed 97,000 in 2017.
--Housing program. The 2017 budget includes $34 million for the VA
Loan Electronic Reporting Interface (VALERI) to manage the 2.4
million VA-guaranteed loans for veterans and their families.
VALERI connects VA with more than 320,000 veteran borrowers and
more than 225,000 mortgage servicer contacts. VA uses the
VALERI tool to manage and monitor efforts taken by private-
sector loan servicers and VA staff in providing timely and
appropriate loss mitigation assistance to defaulted borrowers.
Without these resources, approximately 90,000 veterans and
their families would be in jeopardy of losing their homes each
year, potentially costing the Government an additional $2.8
billion per year. VALERI also supports payment of guaranty and
acquisition claims.
The budget requests the following advance appropriations amounts
for 2018: $90.1 billion for compensation and pensions, $13.7 billion
for readjustment benefits, and $107.9 million for insurance and
indemnities. VA will continue to closely monitor workload and monthly
expenditures in these programs and will revise cost estimates as
necessary in the Mid-Session Review of the 2017 budget, to ensure the
enacted advance appropriation levels are sufficient to address
anticipated veteran needs throughout the year.
the simplified appeals initiative
The current VA appeals process is broken. The more than 80-year-old
process was conceived in a time when medical treatment was far less
frequent than it is today, so it is encumbered by some antiquated laws
that have evolved since WWI and steadily accumulated in layers.
Under current law, the VA appeals framework is complex,
ineffective, confusing, and understandably frustrating for veterans who
wait much too long for final resolution of their appeal. The current
appeals system has no defined endpoint, and multiple steps are set in
statute. The system requires continuous evidence gathering and multiple
re-adjudications of the very same or similar matter. A veteran,
survivor, or other appellant can submit new evidence or make new
arguments at any time, while VA's duty to assist requires continuous
development and re-adjudication. Simply put, the VA appeals process is
unlike other standard appeals processes across Federal and judicial
systems.
Fundamental legislative reform is essential to ensure that veterans
receive timely and quality appeals decisions, and we must begin an
open, honest dialogue about what it will take for us to provide
veterans with the timely, fair, and streamlined appeals decisions they
deserve. To put the needs, expectations, and interests of veterans and
beneficiaries first--a goal on which we can all agree--the appeals
process must be modernized.
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The 2017 budget proposes a Simplified Appeals Process--legislation
and resources (i.e., people, process, and technology) that would
provide veterans with a simple, fair, and streamlined appeals process
in which they would receive a final decision on their appeal within 1
year from filing the appeal by fiscal year 2021.
The 2017 budget requests $156.1 million and 922 FTE for the Board,
an increase of $46.2 million and 242 FTE above the fiscal year 2016
enacted level. This is a down-payment on a long-term, sustainable plan
to provide the best services to veterans. This policy option also
represents the best value to taxpayers (as outlined in the chart,
Analysis of Alternatives).
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Without legislative change or significant increases in staffing, VA
will face a soaring appeals inventory, and veterans will wait even
longer for a decision on their appeal. If Congress fails to enact VA's
proposed legislation to simplify the appeals process, Congress would
need to provide resources for VA to sustain more than double its
appeals FTE, with approximately 5,100 appeals FTE onboard. The prospect
of such a dramatic increase, while ignoring the need for structural
reform, is not a good result for veterans or taxpayers.
While the Simplified Appeals proposal would require FTE increases
for the first several years to resolve the more than 440,000 currently
pending appeals, by 2022, VA would be able to reduce appeals FTE to a
sustainment level of roughly 1,030 FTE (including 980 FTE at the Board
and 50 at VBA), a level sufficient to process all simplified appeals in
1 year. Notably, such a sustainment level is 1,135 FTE less than the
current 2016 budget requires, and is 4,070 FTE less Department-wide
than would be required to address this workload with FTE resources
alone. In addition, this reform would essentially eliminate the need
for appeals FTE at VBA, allowing these resources to be redirected
within VBA to other priorities.
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In 2015, the Board was still adjudicating an appeal that originated
25 years ago, even though the appeal had previously been decided by VA
more than 27 times. Under the Simplified Appeals Process, most veterans
would receive a final appeals decision within 1 year of filing an
appeal. Additionally, rather than trying to navigate a multi-step
process that is too complex and too difficult to understand, veterans
would be afforded a transparent, single-step appeal process with only
one entity responsible for processing the appeal. Essentially, under a
simplified appeals process, as soon as a veteran files an appeal, the
case would go straight to the Board where a Judge would review the same
record considered by the initial decision-maker and issue a final
decision within 1 year; informing the veteran whether that initial
decision was substantially correct, contained an error that must be
corrected, or was simply wrong. If a veteran disagrees with any or all
of the final appeals decision, the veteran always has the option of
filing a new claim for the same benefit once the appeal is resolved, or
may pursue an appeal to the Court of Appeals for Veterans Claims.
Rapid growth in the appeals workload exacerbates this challenge. As
VBA has produced record-setting claims-decision output over the past 5
years, appeals volume has grown commensurately. Between December 2012
and November 2015, the number of pending appeals rose by 34 percent.
Under current law with no radical change in resources, the number of
pending appeals is projected to soar by 397 percent--from 437,000 to
2.17 million (chart, Status of Appeals)--between November 2015 and
fiscal year 2027.
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VA firmly believes that justice delayed is justice denied. In the
streamlined appeals process proposed in the fiscal year 2017
President's budget (chart, Proposed Simplified Appeals), there would be
a limited exception allowing the Board to remand appeals to correct
duty to notify and assist errors made on the part of the Agency of
Original Jurisdiction (AOJ) prior to issuance of the initial AOJ
decision.
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medical and prosthetic research
The 2017 budget continues VA's program of groundbreaking, high
standard research focused on advancing the healthcare needs of all
veterans. The 2017 budget requests $663 million for Medical Research
and supports the President's Precision Medicine Initiative (PMI) to
drive personalized medical treatment and the evolving science of
Genomic Medicine--how genes affect health. In addition to the direct
appropriation, Medical Research will be supported through $1.3 billion
from VA's Medical Care program and other Federal and non-Federal
research grants. Total funding for Medical and Prosthetic Research will
be more than $2.0 billion in 2017.
VA research is focused on the U.S. veteran population and allows VA
to uniquely address scientific questions to improve veteran healthcare.
Most VA researchers are also clinicians and healthcare providers who
treat patients. Thus, VA research arises from the desire to heal rather
than pure scientific curiosity and yields remarkable returns.
For more than 90 years, VA research has produced cutting-edge
medical and prosthetic breakthroughs that improve the lives of veterans
and others. The list of accomplishments includes therapies for
tuberculosis following World War II, the implantable cardiac pacemaker,
computerized axial tomography (CAT) scans, functional electrical
stimulation systems that allow patients to move paralyzed limbs, the
nicotine patch, the first successful liver transplants, the first
powered ankle-foot prosthesis, and a vaccine for shingles. VA
researchers also found that one aspirin a day reduces by half the rate
of death and nonfatal heart attacks in patients with unstable angina.
More recently, VA investigators tested an insulin nasal spray that
shows great promise in warding off Alzheimer's disease and found that
prazosin (a well-tested generic drug used to treat high blood pressure
and prostate problems) can help improve sleep and lessen nightmares for
those with post-traumatic stress disorder.
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Beyond VA's support of more than 2,200 continuing research
projects, VA will leverage our Million Veteran Program (MVP)--already
one of the world's largest databases of genetic information--to support
several Precision Medicine Initiatives. The first initiative will
evaluate whether using a patient's genetic makeup to inform medication
selection is effective in reducing complications and getting patients
the most effective medication for them. This initiative will focus on
up to 21,500 veterans with PTSD, depression, pain, and/or substance
abuse.
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The second initiative will focus on additional analysis of DNA
specimens already collected in the MVP. More than 438,000 veteran
volunteers have contributed DNA samples so far. Genomic analysis on
these DNA specimens allows researchers to extract critical genetic
information from these specimens. There are several possible ``levels''
of genomic analyses, with increasing cost.
Built into the design of MVP and currently funded within the VA
research program is a process known as ``exome chip'' genotyping--the
tip of the iceberg in genomic analysis. Exome Chip genotyping provides
useful information, but newer technologies promise significantly
greater information for improving treatments. VA proposes conducting
the next level of analysis, known as ``exome sequencing,'' on up to
100,000 veterans who are enrolled in MVP. This exome sequencing
analyzes the part of the genome that codes for proteins--the large,
complex molecules that perform most critical functions in the body.
Sequencing efforts will begin with a focus on veterans with PTSD and
frequently co-occurring conditions such as depression, pain, and
substance abuse, and expand to other chronic illnesses such as diabetes
and heart disease, among others. This more detailed genetic analysis
will provide greater information on the biological factors that may
cause or increase the risk for these illnesses.
VA's research and development program improves the lives of
veterans and all Americans through healthcare discovery and innovation.
other priorities
Information Technology
The 2017 budget demonstrates VA's commitment to using cutting-edge
information technology (IT) to support transformation and ensure that
the veteran is at the center of everything we do. The budget requests
$4.28 billion--an increase of $145 million (3.5 percent) from the 2016
enacted level--to help stabilize and streamline core processes and
platforms, eliminate the information security material weakness, and
institutionalize new capabilities to deliver improved outcomes for
veterans. The request includes $471 million for new efforts to develop,
improve, and enhance clinical and benefits systems and processes and
supports VA's strategy to replace FMS. The 2017 budget was developed
through Federal IT Acquisition Reform Act (FITARA) compliant processes
led by the Chief Information Officer (CIO), in concert with the Chief
Financial Officer and Chief Acquisition Officer.
In fiscal year 2015, the Office of Information and Technology (OIT)
developed an IT Enterprise Strategy and an Enterprise Cybersecurity
Strategy. These strategies support OIT's vision to become a world-class
organization that provides a seamless, unified veteran experience
through the delivery of state-of-the-art technology. OIT is
implementing a new IT Security Strategy to improve VA's security
posture and eliminate the Federal Information Security Management Act/
Federal Information System Controls Audit Manual material weakness.
The 2017 budget includes $370.1 million for information security,
an increase of 105 percent over the fiscal year 2016 funding level. In
addition, the 2017 budget includes $50 million to launch a new Data
Management program to use data as a strategic resource. Under this
program, VA will inventory its data collection activities--with the
objective of requesting data from the veteran only once--and dispose
expired information in a secure and timely way. These two aspects will
reduce VA costs for data storage and support safeguards for veterans'
information.
National Cemetery Administration
The National Cemetery Administration (NCA) has the solemn duty to
honor veterans and their families with final resting places in national
shrines and with lasting tributes that commemorate their service and
sacrifice to our Nation. The 2017 budget requests $286 million, an
increase of $15 million (5.5 percent) to allow VA to provide perpetual
care for more than 3.5 million gravesites and more than 8,800 developed
acres. The budget supports NCA's efforts to raise and realign
gravesites and repair turf in order to maintain cemeteries as national
shrines. The budget also continues implementation of a Geographic
Information System to enable enhanced accounting of remains and
gravesites and enhanced gravesite location for visitors. The budget
positions NCA to meet veterans' emerging burial and memorial needs in
the decades to come by ensuring that veterans and their families
continue to have convenient access to a burial option in a National,
State, or Tribal veterans cemetery and that the service they receive is
dignified, respectful, and courteous.
va infrastructure
The 2017 budget requests $900.2 million for VA's Major and Minor
construction programs. The budget invests in infrastructure projects at
existing campuses that will lead to seismically safe facilities,
ensuring that veterans are safe when they seek care. The capital asset
budget request demonstrates VA's commitment to address critical Major
construction projects that directly affect patient safety and seismic
issues, and reflects VA's promise to provide safe and secure facilities
for veterans. The 2017 budget also requests funding to ensure that VA
has the ability to provide eligible veterans with access to burial
services through new and expanded cemeteries, and prevent the closure
to new interments in existing cemeteries.
VA acknowledges the transformation underway in the landscape for
healthcare delivery. Our future space needs may be impacted by the
changes we are already implementing in how we deliver care for
veterans. In addition, we plan to potentially incorporate any
recommendations from the Commission on Care and their impact on our
changing service delivery into our long-term infrastructure strategy.
Leasing provides flexibility and enables VA to more quickly adapt
to changes in medical technology, workload, new programs, and
demographics. VA is also looking to Congress for authorization of 18
leases submitted in VA's fiscal year 2015 and 2016 budget requests. The
pending major medical facility lease projects will replace, expand, or
create new outpatient clinics and research facilities and are critical
for providing access for veterans and enhancing our research
capabilities nationwide. The 2017 budget includes a request to
authorize six additional replacement major medical facility leases
under VA's authority in 38 U.S.C. Sec. Sec. 8103 and 8104 and with the
anticipated delegation of leasing authority from the General Services
Administration. The Department is awaiting authorization of its request
to expand the definition of ``Medical Facilities'' in VA's authorizing
statutes to allow VA to more easily partner with other Federal
agencies. Another proposal that deserves attention is authorization of
enhanced use lease (EUL) authority to encompass broader possibilities
for mixed-use projects. This change would give VA more opportunities to
engage the private sector, local governments, and community partners by
allowing VA to use underutilized property that would benefit veterans
and VA's mission and operations.
Major Construction
The 2017 budget requests $528.1 million for Major Construction. The
request includes funds to address seismic problems in facilities in
Long Beach, California, and Reno, Nevada. These projects will correct
critical safety and seismic deficiencies that pose a risk to veterans,
VA staff, and the public. Consistent with Public Law 114-58, the
Department must identify a non-VA entity to execute these two projects,
as they are more than $100 million. We have identified the U.S. Army
Corps of Engineers as our construction agent to execute these projects.
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We must prevent the devastation and potential loss of life that may
occur because our facilities are vulnerable to earthquakes--such as the
one that occurred in 1971 in San Fernando, California. As shown, a 6.5-
magnitude earthquake caused two buildings in the San Fernando Medical
Center to collapse and 46 patients and staff to lose their lives.
These images show a known seismic deficiency at the San Francisco
Medical Center--built in 1933--wherein the rebar does not extend into
the ``pile cap.''
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The request also includes funding for new national cemeteries in
western New York and southern Colorado, and national cemetery
expansions in Jacksonville, Florida and South Florida. These cemetery
projects support NCA's goal to ensure that eligible veterans have
access to a burial option within a reasonable distance from their
residences.
--The new western New York national cemetery will establish a
dignified burial option for more than 96,000 veterans plus
eligible family members in the western New York region.
--The new southern Colorado national cemetery will establish a
dignified burial option for more than 95,000 veterans plus
eligible family members in the southern Colorado region.
--The Jacksonville National Cemetery expansion will develop
approximately 30 acres of undeveloped land to provide
approximately 20,200 gravesites.
--The South Florida National Cemetery expansion will develop
approximately 25 acres of undeveloped land to provide
approximately 21,750 gravesites.
Minor Construction
In 2017, the budget requests $372 million for Minor Construction.
The requested amount would provide funding for ongoing projects that
renovate, expand and improve VA facilities, while increasing access for
our veterans. Examples of projects include enhancing women's health
programs; providing additional domiciliaries to further address
veterans' homelessness; improving safety; mitigating seismic
deficiencies; transforming facilities to be more veteran-centric;
enhancing patient privacy; and enhancing research capabilities.
The Minor Construction request will also provide funding for
gravesite expansion and columbaria projects to keep existing national
cemeteries open, and will support NCA's urban and rural initiatives. It
will also provide funding for projects at VBA regional offices
nationwide and will fund infrastructure repairs and enhancements to
improve operations for the Department's staff offices.
Leasing
The 2017 budget includes a request to authorize six replacement
major medical facility leases located in Corpus Christi, Texas;
Jacksonville, Florida; Pontiac, Michigan; Rochester, New York; Tampa,
Florida; and Terre Haute, Indiana. These leases will allow VA to
provide continued access to veterans that are served in these
locations.
myva transformation
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MyVA puts veterans in control of how, when, and where they wish to
be served. It is a catalyst to make VA a world-class service provider--
a framework for modernizing VA's culture, processes, and capabilities
to put the needs, expectations, and interests of veterans and their
families first. A veteran walking into any VA facility should have a
consistent, high-quality experience.
MyVA will build upon existing strengths to promote an environment
where VA employees see themselves as members of one enterprise,
fortified by our diverse backgrounds, skills, and abilities. Moreover,
every VA employee--doctor, rater, claims processor, custodian, or
support staffer, or the Secretary of Veterans Affairs--will understand
how they fit into the bigger picture of providing veteran benefits and
services. VA, of course, must also be a good steward of public
resources. Citizens and taxpayers should expect to see efficiency in
how we run our internal operations.
The fiscal year 2017 budget will make investments toward the five
critical MyVA objectives:
1. Improving the veteran experience: At a bare minimum, every
contact between veterans and VA should be predictable, consistent, and
easy; however, we are aiming to make each touchpoint exceptional. It
begins with receptionists who are pleasant to our veteran clients, but
there is also a science to this experience. We are focusing on human-
centered design, process mapping, and working with leading design firms
to learn and use the technology associated with improving every
interaction with clients.
2. Improving the employee experience--so we can better serve
veterans: VA employees are the face of VA. They provide care,
information, and access to earned benefits. They serve with distinction
daily. We cannot make things better for veterans without improving the
work experience of our dedicated employees. We must train them. We must
move from a rules/fear-based culture to a principles/values-based
culture. I learned in the private sector that it is absolutely not a
coincidence that the very best customer-service organizations are
almost always among the best places to work.
3. Improving internal support services: We will let employees and
leaders focus on assisting veterans, rather than worrying about ``back
office'' issues. We must bring our IT infrastructure into the 21st
century. Our scheduling system, where many of our issues with access to
care were manifest, dates to 1985. Our Financial Management System is
written in COBOL, a language I used in 1973. This is simply
unacceptable. It impedes all of our efforts to best serve veterans.
4. Establishing a culture of continuous improvement: We will apply
Lean strategies and other performance improvement capabilities to help
employees examine their processes in new ways and build a culture of
continuous improvement.
5. Enhancing strategic partnerships: Expanding our partnerships
will allow us to extend the reach of services available for veterans
and their families. We must work effectively with those who bring
capabilities and resources to help veterans.
Breakthrough Priorities for CY 2016
While we have made progress, we are still on the first leg of a
multi-year journey. We have narrowed down our near-term focus to 12
``breakthrough priorities.''
Many of these reflect issues which are not new--they have been
known problems, in some cases, for years. We have already seen some
progress in solving many of them. However, we still have much work to
do.
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
The following are our 12 priorities and the 2016 outcomes to which
we aspire. We understand that it will be a challenge to accomplish all
of these goals this year, but we have committed ourselves to producing
results for veterans and creating irreversible momentum to continue the
transformation in future years.
Veteran Facing Goals
1. Improve the Veteran Experience.
-- Breakthrough Outcome for 2016:
-- Strengthen the trust in VA to fulfill our country's
commitment to veterans; currently measured at 47 percent,
we want it to be 70 percent by year end.
-- Establish a Department-wide customer experience measurement
framework to enable data-driven service improvements.
-- Make the Veterans Experience office fully operational.
-- Expand the network of Community Veteran Engagement Boards to
more than 100.
-- Additionally, in order to deliver experiences to veterans
that are effective, easy, and in which veterans feel
valued, medical centers will ensure that they are fully
staffed at the frontline with well-prepared employees who
have been selected for their customer service.
Functionally, this means new frontline staff will be
assessed through a common set of customer service criteria,
hired within 30 days of selection, and provided a
nationally standardized onboarding and training program.
2. Increase Access to Health Care.
-- Breakthrough Outcome for 2016:
-- When veterans call or visit primary care facilities at a VA
Medical Center, their clinical needs will be addressed the
same day.
-- When veterans call for a new mental health appointment, they
receive a suicide risk assessment and immediate care if
needed. Veterans already engaged in mental healthcare
identifying a need for urgent attention will speak with a
provider the same day.
-- Utilizing existing VistA technology, veterans will be able
to conveniently get medically necessary care, referrals,
and information from any VA Medical Center, in addition to
the facility where they typically receive their care.
3. Improve Community Care.
-- Breakthrough Outcome for 2016: Improve the veterans'
experience with Care in the Community. Following enactment of
our requested legislation, by the end of the year:
-- VA will begin to consolidate and streamline its non-
Department Provider Network and improve relationships with
community providers and core partners.
-- Veterans will be able to see a community provider within 30
days of their referral.
-- Non-Department claims will be processed and paid within 30
days, 85 percent of the time.
-- Healthcare claims backlog will be reduced to less than 10
percent of total inventory.
-- Referral and authorization time will be reduced.
4. Deliver a Unified Veteran Experience.
-- Breakthrough Outcome for 2016:
-- Vets.gov will be able to provide veterans, their families,
and caregivers with a single, easy-to use, and high-
performing digital platform to access the VA benefits and
services they have earned.
-- Vets.gov will be data-driven and designed such that the top
100 search terms will be available within one click from
search results. The top 100 search terms will all be
addressed within one click on the site.
-- All current content, features and forms from the current
public-facing VA websites will be redesigned, rewritten in
plain language, and migrated to Vets.gov, in priority order
based on veteran demand.
-- Additionally, we will have one authoritative source of
customer data; eliminating the disparate streams of
Administration-specific data that require veterans to
replicate inputs.
5. Modernize our Contact Centers (Including Veterans Crisis
Line).
-- Breakthrough Outcome for 2016:
-- Veterans will have a single toll free phone number to access
the VA Contact Centers, know where to call to get their
questions answered, receive prompt service and accurate
answers, and be treated with kindness and respect. VA will
do this by establishing the initial conditions necessary
for an integrated system of customer contact centers.
-- By the end of this year, every veteran in crisis will have
his or her call promptly answered by an experienced
responder at the Veterans Crisis Line.
6. Improve the Compensation & Pension (C&P) Exam Process.
-- Breakthrough Outcome for 2016:
-- Improved veteran satisfaction with the C&P Exam process. We
have a baseline satisfaction metric in place and have
established a goal for significant improvement.
-- VA will have a national rollout of initiatives to ensure the
experience is standardized across the Nation.
7. Develop a Simplified Appeal Process.
-- Breakthrough Outcome for 2016:
-- Subject to successful legislative action, put in place a
simplified appeals process, enabling the Department to
resolve 90 percent of appeals within 1 year of filing by
2021.
-- Increase current appeals production to more rapidly reduce
the existing appeals inventory.
8. Continue Progress in Reducing Veteran Homelessness.
-- Breakthrough Outcome for 2016:
-- Continue progress toward an effective end to veteran
homelessness by permanently housing or preventing
homelessness for an additional 100,000 veterans and their
family members.
VA Internal Facing Goals
9. Improve the Employee Experience (Including Leadership
Development).
-- Breakthrough Outcome for 2016:
-- Continue to improve the employee experience by developing
engaged leaders at all levels who inspire and empower all
employees to deliver a seamless, integrated, and responsive
VA customer service experience.
-- More than 12,000 engaged leaders skilled in applying LDL
principles, concepts, and tools will work projects and/or
initiatives to make VA a more effective and efficient
organization.
-- Improve VA's employee experience by incorporating LDL
principles into VA's leadership and supervisor development
programs and courses of instruction.
-- VA Senior Executive performance plans will include an
element that targets how to improve employee engagement and
customer service, and all VA employees will have a customer
service standard in their performance plans.
-- All VA supervisors will have a customer service standard in
their performance plans.
-- VA will begin moving from paper-based individual development
plans to a new electronic version, making it easier for
both supervisors and employees.
10. Staff Critical Positions.
-- Breakthrough Outcome for 2016:
-- Achieve significantly improved critical staffing levels that
balance access and clinical productivity, with targets of
95 percent of Medical Center Director positions filled with
permanent appointments (not acting) and 90 percent of other
critical shortages addressed--management as well as
clinical.
-- Work to reduce ``time to fill'' hiring standards by 30
percent.
11. Transformation the Office of Information & Technology (OIT).
-- Breakthrough Outcome for 2016: Achieve the following key
milestones on the path to creating a world-class IT
organization that improves the support to business partners and
veterans.
-- Begin measuring IT projects based on end product delivery,
starting with a near-term goal to complete 50 percent of
projects on time and on budget.
-- Stand up an account management office.
-- Develop portfolios for all Administrations.
-- Tie all supervisors' and executives' performance goals to
strategic goals.
-- Close all current cybersecurity weaknesses.
-- Develop a holistic veteran data management strategy.
-- Implement a quality and compliance office.
-- Deploy a transformational vendor management strategy.
-- Ensure implementation of key initiatives to improve access
to care.
-- Establish one authoritative source for veteran contact
information, military service history, and veteran status.
-- Finalize the Congressionally mandated DOD-VA
Interoperability requirements.
12. Transform Supply Chain.
-- Breakthrough Outcome for 2016:
-- Build an enterprise-wide integrated Medical-Surgical supply
chain that leverages VA's scale to drive an increase in
responsiveness and a reduction in operating costs. More
than $150 million in cost avoidance will be redirected to
priority veteran programs.
We are rigorously managing each of these ``breakthrough
priorities'' by instituting a Department level scorecard, metrics, and
tracking system. Each priority has an accountable and responsible
official and a cross-functional, cross-Department team in support. Each
team meets every other week in person with either the Secretary or
Deputy Secretary to discuss progress, identify roadblocks, and problem
solve solutions. This is a new VA--more transparent, collaborative, and
respectful; less formal and bureaucratic; more execution and outcome-
focused; principles based, not rules-based.
legislative priorities
The Department is grateful for your continuing support of veterans
and appreciates your efforts to pass legislation enabling VA to provide
veterans with the high-quality care they have earned and deserve. We
have identified a number of necessary legislative items that require
action by Congress in order to best serve veterans going forward:
1. Improve Care in the Community: We need your help, as discussed
on many occasions, to help overhaul our Care in the Community programs.
VA staff and subject matter experts have communicated regularly with
congressional staff to discuss concepts and concerns as we shape the
future plan and recommendations. We believe that together we can
accomplish legislative changes to streamline Care in the Community
programs before the end of this session of Congress.
2. Flexible Budget Authority: We need flexible budget authority to
avoid artificial restrictions that impede our delivery of care and
benefits to veterans. Currently, there are more than 70 line items in
VA's budget that dedicate funds to a specific purpose without adequate
flexibility to provide the best service to veterans. These include
limitations within the same general areas, such as healthcare funds
that cannot be spent on healthcare needs. These restrictions limit VA's
ability to deliver veteran care and benefits based on demand, rather
than specific funding lines. The 2017 b`udget proposes appropriations
language to provide VA with new authority to transfer up to 2 percent
of the discretionary appropriations for fiscal year 2017 between any of
VA's discretionary appropriations accounts, excluding Medical Care.
This new authority would give VA greater ability to address emerging
needs and overcome artificial funding restrictions on providing
veterans' care and benefits.
3. Support for the Purchased Health Care Streamlining and
Modernization Act: This legislation would clarify VA's ability to
contract with providers in the community on an individual basis,
outside of Federal Acquisition Regulations (FAR), without forcing
providers to meet excessive compliance burdens, while maintaining
essential worker protections. The proposal allows this option only when
care directly from VA or from a non-VA provider with a FAR-based
agreement in place is not feasibly available. Already, we have seen
certain nursing homes not renew their agreements with VA because of the
excessive compliance burdens, and as a result, veterans are forced to
find new nursing home facilities for residence.
VA further requests your support for our efforts to recruit
and retain the very best clinical professionals. These include, for
example, flexibility for the Federal work period requirement, which is
inconsistent with private sector medicine, and special pay authority to
help VA recruit and retain the best talent possible to lead our
hospitals and healthcare networks.
4. Special Legislation for VA's West Los Angeles Campus: VA has
requested legislation to provide enhanced use leasing authority that is
necessary to implement the Master Plan for our West Los Angeles Campus.
That plan represents a significant and positive step for veterans in
the Greater West Los Angeles area, especially those who are most in
need. We appreciate the Committee's hearing in December 2015 on
legislation to implement that Master Plan, and VA urges your support
for expedited consideration of this bill to secure enactment of it in
this session of Congress. Enactment of the legislation will allow us to
move forward and get positive results for the area's veterans after
years of debate in the community and court action. This bill would
reflect the settlement of that litigation, and truly be a win-win for
veterans and the community. I believe this is a game-changing piece of
legislation as it highlights the opportunities that are possible when
VA works in partnership with the community.
5. Overhaul the Claims Appeals Process: As mentioned earlier, VA
needs legislation that sets out structural reforms that will allow VBA
and the Board to provide veterans with the timely, fair, and quality
appeals decisions they deserve thereby addressing the growing inventory
of appeals.
Lastly, let me again remind everyone that the vast majority of VA
employees are hard workers who do the right thing for veterans every
day. However, we need your assistance in supporting the cultural change
we are trying to drive. We are working to change the culture of VA from
one of rules, fear, and reprisals to one of principles, hope, and
gratitude. We need all stakeholders in this transformation to embrace
this cultural transformation, including Congress. In fact, I think
Congress, above all, recognizes the policy window we have at hand and
must have the courage to make the type of changes it is asking VA and
our employees to make. Congress can only put veterans first by caring
for those who serve veterans.
Our dedicated VA employees, if given the right tools, training, and
support, can and go out of their way to provide the best care possible
to our veterans and their families.
closing
VA exists to serve veterans. We have spent the last year and a half
working to find new and better ways to provide high quality care and
administer benefits effectively and efficiently through responsible use
of taxpayer dollars. We will continue to face enormous challenges, and
this budget request will provide the resources needed to continue the
transformation of this Department.
This budget and associated legislative proposals will allow us to
streamline care for veterans and improve access by addressing existing
gaps, develop a simplified appeals process, further the progress we
have made to eliminate the VBA claims backlog and end veteran
homelessness, and improve our cyber security posture to protect veteran
and employee data. It will also allow us to continue implementing MyVA
to guide overall improvements to VA's culture, processes, and
capabilities.
I have pledged that VA will ensure that the funds Congress
appropriates to VA will be used to improve both the quality of life for
veterans and the efficiency of our operations. I am proud to continue
this work and recognize there is much left to be done. We have made
great strides and are grateful for the support of Congress through this
transformation.
Thank you for the opportunity to appear before you today and for
your continued steadfast support of veterans. We look forward to your
questions.
HINES VAMC SCHEDULING MANIPULATION INVESTIGATION
Senator Kirk. Let me start the questions here, and say, Mr.
Secretary, Ms. Germaine Clarno is a social worker at the VA
hospital in Hines, Illinois. She has been calling for the VA to
fix failures at the hospital for years.
I introduced you to Germaine in Chicago in January of 2015
and again in my office on April 21, so you know her. It was 11
months after I asked your predecessor, General Shinseki, to
investigate the allegations of Ms. Clarno at the Veterans
Hospital in Hines similar to the scandal at the Phoenix VA, all
to acquire bonuses and promotions.
This is why I called for the resignation of Joan Ricard,
the person who led the Hines VA, and then she retired.
Fourteen months after my call to General Shinseki on July
20, 2015, your chief of staff, Rob Nabors, concluded that the
Inspector General investigation had ``thoroughly addressed the
concerns of the complainant Germaine Clarno'' as summary number
one. In response, both Germaine and the Office of Special
Counsel (OSC) asked for the full Inspector General
investigation report. That was 7 months ago.
Summary number two of the Inspector General investigation
on Hines' scheduling manipulation also came from the Inspector
General on September 8. And in response, 2 weeks ago, the OSC
wrote President Obama on the Hines investigation that the
report was ``incomplete'' and ``not responsive,'' did not
respond to the whistleblower's concerns raised and ``did not
meet the statutory requirements,'' and was, ``not responsive to
the serious allegations of significant wait times and delays in
the veterans' access at Hines.'' It also said, ``it
demonstrated hostility'' toward Ms. Clarno apparently for
having spoken publicly, as well as an attempt to minimize her
allegations.
Again, summary number three was released, but not a report
with the VA's instructions for change.
Secretary McDonald, the VA-MilCon section of the funding
bill of the omnibus did require all ``work products'' to be
transmitted to the Appropriations Committee. I would ask you if
you have brought this full report, and I would like you to
bring the full report to the subcommittee as required by law,
which would really help Ms. Baldwin on the candy factory at
Tomah to get the complete Inspector General report, as required
by law. I have also discussed this with our ranking member, Mr.
Tester.
Secretary McDonald. Mr. Chairman, we want all of the
Inspector General reports to be released. In fact, as you
properly pointed out, I have met with Ms. Clarno on numerous
occasions. We appreciate her coming forward and describing what
was wrong at Hines.
As you properly pointed out, these investigations occurred
in the middle of 2014 before I was confirmed. The President has
nominated a new Inspector General, and we would like the Senate
to immediately confirm that new Inspector General, Mike Missal,
because we have a lot of work to do with the Inspector General
to get these reports out.
Also, in the letter that you referenced from the Inspector
General, if you read the next paragraph, the Inspector General
says that she is optimistic that this new Inspector General
will conduct more thorough investigations in a more appropriate
and comprehensive direction for the Department.
Our Deputy Secretary is digging into all of these issues
and sorting out the differences in opinion between the
Inspector General report and between the Office of Special
Counsel. We are working with both parties to do that. As soon
as we are done doing that, we will get back to [you]
immediately.
But again, I just want to say we appreciate Ms. Clarno
pointing these things out.
Senator Kirk. She is sitting right behind you there.
Let's keep going. Mr. Tester.
Senator Tester. Thank you.
INSPECTOR GENERAL CONFIRMATION
Just very quickly, Secretary McDonald, what you are saying
is that if Mike Missal can get confirmed, you could get that
information to us quicker?
Secretary McDonald. Yes, sir. I think we have been short-
staffed at the Inspector General since the Inspector General
retired.
Senator Tester. So it is important. I believe he is cleared
on our side and so if, Mr. Chairman, if you and the other
members of this subcommittee can make that plea to your caucus
to take off the hold so we can get him confirmed, it could make
a big difference.
I think it is important we get this report. I think we need
to get the good information on this report and get it as soon
as possible, so I support the chairman's efforts here, but you
guys need the tools to be able to do that. So please help.
BETTER CARE IN THE COMMUNITY LEGISLATION
As I said in my opening, I am working on a bipartisan piece
of legislation, a number of issues including provider
agreements, spending flexibility that will allow you to provide
better care in the community in a timely manner.
Can I get a commitment from you, Mr. Secretary, that you
will help get this bill across the finish line, particularly
with the VA Committee?
Secretary McDonald. Yes, sir. I believe we are doing that
Tuesday.
Senator Tester. Would you agree that if we do not get that
bill done, that it could have a dramatic impact or continue the
kind of impacts we are having on veterans right now with
Choice?
Secretary McDonald. Yes, sir. One of the reasons our
service is so bad with a third-party administrator, like Health
Net, is resolved in this bill.
Senator Tester. Okay, good. That is good. Thank you for
that.
2018 ADVANCE APPROPRIATION
Last week, when Dr. Shulkin was here, we questioned him
about a gaping hole in the fiscal year 2018 advance
appropriations for medical care. You are going to get a second
bite at this apple, but this is going to be a big bite.
My understanding is the VA's future costs for all hires
under the Choice Act is $1.3 billion and the future costs for
leases and activation is about $318 million. None of these
costs have been built into that 2018 advance request. Is that
correct?
Secretary McDonald. Yes, sir.
Senator Tester. Okay. So on top of that, between the Choice
Act funds and discretionary appropriations, I think you are
planning on spending about $12 billion on Care in the Community
in fiscal year 2017. Your head is nodding, so I assume that is
correct.
But in 2018, the advance appropriations request for Care in
the Community is about $9.4 billion. I hope you can track these
numbers. You know them. That is almost a $3 billion reduction,
and Choice funding will probably be exhausted by then. How are
you going to make up the difference?
Secretary McDonald. I think, again, you mentioned the
second bite idea, but I think the issue here, Senator Tester,
is we have to know what we are actually going to provide before
we can cost it out. That is why Tuesday's hearing with the
authorizing committee is so important, because if we can deal
with your bill, your consolidation bill, consolidation of Care
in the Community from the seven different methods to one, we
will know exactly how to cost it out.
But as you know, there are choices within that bill, there
are choices available, so we are waiting to see what the
authorizers authorize. Then we will know exactly what the cost
will be.
Senator Tester. So you know, and I think you probably know
this, the nondefense discretionary cap is going to be $3
billion lower than it is this year, so we are going to get a
double whammy off this thing, if you know what I mean.
So we look forward to making sure we do not have a
shortfall in your monies.
SES EXECUTIVES TO TITLE 38
Mr. Secretary, you put forth a proposal that would allow
the VA to move all of its senior executives to title 38. Can
you explain how this move will impact the accountability at
your Department?
Secretary McDonald. The idea of moving our Senior Executive
Service staff to title 38 was to help us recruit, because we
would have direct hiring authority. It was to help us pay more
competitively. Most of our medical center directors make less
than 50 percent of what they can get from the private sector,
because they are Readjustment Counseling Service (RCS)
employees.
It would also have the appeal authority for disciplinary
actions within the Department, so I would be the appellate
authority rather than the Merit Systems Protection Board
(MSPB).
In working within the executive branch, we have come to the
point of view that that is appropriate for medical people in
the Veterans Health Administration (VHA), but there is some
pause whether or not we should apply that it people in the
[Veterans] Benefits Administration.
Senator Tester. Would it make a difference in
accountability?
Secretary McDonald. We are coming up with a proposal, which
we will share with you on Tuesday, that would make a difference
in accountability, yes, sir.
SIMPLIFIED APPEALS PROCESS PROPOSAL
Senator Tester. Okay. You put forth a proposal, very
quickly, on the appeals process.
Secretary McDonald. Yes, we have.
Senator Tester. Have you contacted the Veterans Service
Organizations (VSOs) on that proposal?
Secretary McDonald. We have had people locked in the room
this week, including Veterans Service Organizations, AHF
members, working on the proposal.
Senator Tester. So you cannot tell me whether they support
it or not at this point in time?
Secretary McDonald. I think it is safe to say that they
support most of the elements in the proposal. I think the most
difficult element in that proposal is freezing the form 9,
which would cause a veteran to reapply.
Senator Tester. All right. Thank you.
Thank you, Mr. Chairman.
Senator Kirk. Ms. Collins.
Senator Collins. Thank you, Mr. Chairman.
ACCESS RECEIVED CLOSER TO HOME
Mr. Secretary, welcome. We have discussed many times the
ARCH (Access Received Closer to Home) program, which exists in
northern Maine, which is one of the five pilot sites across the
country. This program, as you well know, allows veterans in
rural areas to receive exceptionally high-quality care close to
home, close to their families, and when they need it.
It has a 90 percent patient satisfaction rate. And
according to the VA's own figures, the average cost per veteran
in Maine using the ARCH program is less than the average cost
for the VHA direct care.
This is a program that has been very well-received. It has
been extremely well-operated. And it contrasts sharply with the
experience that Maine veterans have had with the Choice program
where fewer than 50 percent of eligible Choice program patients
in Maine have received the appointments they need when they
need it. And the contractor chosen by the VA, Health Net, has
performed very poorly in my State.
Given the huge success of the ARCH program and how happy
our veterans are with it, and how cost effective it is, I do
not understand the resistance of the VA to preserving the
program.
I hear all of this discussion of folding ARCH into the
Choice program. To me, ARCH ought to be the model for the
Choice program. ARCH is working, working well. The Choice
program is not working well.
So will you consider extending the ARCH program in its
current form, so that we are not taking a program that is
working well and breaking it by folding it into a program that
is not working well?
Secretary McDonald. Senator Collins, the new program that
we are talking about, taking the seven different ways of
achieving care in the community, including ARCH, and
consolidating them into one is not consolidating them into the
old Choice program. It is creating a whole new program that
takes the benefits, the things we learned from the ARCH pilot,
and folds them into a wholly new program that provides care in
the community in one way with one reimbursement rate.
So I think we should look at the bill Senator Tester has
authored and others in our authorization committee have all
have authored as a wholly new program that will take everything
we have learned from Choice and from ARCH and actually
consolidate it in a new program that will make things easier
for veterans and make things easier for our employees.
David, would you like to comment?
Dr. Shulkin. Senator Collins, I think you are accurate. The
ARCH program predated Choice. It has worked extremely well.
As you know, it is a relatively small number of veterans. I
think in the State of Maine, it is about 1,400 veterans. It is
pretty small.
So that idea of expanding the ARCH program to be this
consolidated program is one that we have looked at. But the
cost of that would be extraordinary because, as you know, ARCH
was meant to get veterans access in rural areas, in areas where
there are provider shortages. So we tend to have a
reimbursement rate for providers that would be really
unsustainable for the rest of the country.
So we are trying to preserve what has worked in ARCH in
this new Veterans Choice program.
Senator Collins. Well, let me just point out that the
hospital, Cary Medical Center, that is administering the ARCH
program is paid at Medicare reimbursement rates. And according
to the VA's own figures, the average cost per veteran in Maine
using ARCH is $2,708.70--a pretty precise number--which is less
than the VHA direct care.
So my concern is that you are going to cause disruption in
a program that has been cost-effective and has worked very
well. That is what I am really worried about.
I just cannot overstate how satisfied the veterans are with
this program.
My time has expired, and I know we have a vote. I have an
important question on the opioid problem and the prescriptions
that are prescribed by the VA. The risk of death by accidental
overdose among patients at the VA facilities is nearly twice
that of nonveterans, so I would ask to submit that question and
others for the record.
Thank you.
Senator Kirk. I think since we have a vote that has just
been called, we will take a short recess.
[Recess.]
Senator Murkowski [presiding]. At this time, I will turn to
Senator Hoeven.
VETERANS CHOICE IMPROVEMENT ACT
Senator Hoeven. Thank you, Madam Chairman.
Mr. Secretary, good to have you here.
We need to improve the Veterans Choice Act. That is why I
have worked with Senator Burr and others to introduce the
Veterans Choice Improvement Act. We are looking to combine that
with the work that the VA Committee has already done, which
includes legislation that I have crafted relative to long-term
care and in-home care, combine that with healthcare.
We are looking to bring all this together and move it as
soon as we can. You and I have talked about this.
Secretary McDonald. Yes, we have.
Senator Hoeven. But this provides the important flexibility
so that you can not only provide quality institutional care
within the VA for veterans that want to access that, but also
so that we make the Veterans Choice Act work.
We have a big problem with these third-party service
providers, like Health Net, that are not providing quality
service, and that is giving Veterans Choice a bad name.
So we have an opportunity here to make this thing work, but
we have to figure out how to do it. This legislation empowers
you to do that.
CHOICE THIRD PARTY SERVICE PROVIDERS
So what I would like you to respond to is how you intend to
handle these third-party service providers.
Secretary McDonald. Over time, I think what we need to do,
and this is why a change in legislation is so important, is
change the contractual relationship with third-party service
providers.
I think we can't outsource customer service. In my opinion,
that was the big mistake with the original Choice Act. We
basically just outsourced customer service to the third-party
providers. So the third-party provider, we would literally just
give the veteran a phone number to call. That is just not
right.
I mean, we are in the customer service business. Our vision
is to be the best customer service organization in government.
We should not be outsourcing customer service.
We have to change that relationship. That is part of what
the new law, that we are very appreciative for, would do.
David.
Dr. Shulkin. Senator, the other thing I would say is, as
you know, the Choice program, we had to bring it from
conception to start in 90 days, so it was a very short time
period. What we have been doing since then is we have been
meeting with private industry, mostly the managed care industry
and the outsourced industry, and getting the very best
practices and the very best thoughts so that we can develop a
request for proposal (RFP) when we go out under the new
Veterans Choice program to have a much better program that is
really state-of-the-art.
Senator Hoeven. Then one of the keys is that this
legislation will also give you the ability to provide that
service directly. In other words, the VA itself work with
veterans to go to private healthcare providers. I think that is
a very important piece.
For example, in our State, with the Fargo VA Health Care
Center, which serves all of North Dakota and most of Minnesota,
they have a very good reputation for providing quality care.
You have a director there, Lavonne Liversage, who has people in
her customer service area that can work with private healthcare
providers, and she is willing to do that. Thank you for
committing to come out and help us set that up.
So, one, are you willing to let us set up that kind of
approach to show that it works? I think you have already done
it in Alaska, in Montana. We need to be able to do it.
Then will you keep that option, which we allow you to do
under the legislation? So if you want to go bid for a service
provider and not work for somebody, well, that may be okay, but
we can also do it directly so we can ensure that our veterans
get that access to quality care, whether it is at the VA or
through a private healthcare provider.
Secretary McDonald. Senator, that is exactly what we want
to do. We envision an optimized network of great providers all
across the country, so that the issues that Senator Murkowski,
for example, has raised in Alaska, where the Choice program cut
out the Alaska Native Health system, we can get them back in,
because they are great providers, they are great partners of
us, and we would like to be able to develop that optimized
system rather than only having one entrance door for the
veterans, which is ``call this phone number.''
So that is exactly what we have in mind. We appreciate your
advocacy for it.
Senator Hoeven. Than the other piece, if you would touch on
for a minute, is we have worked to include legislation that
enables nursing homes and other providers of long-term care,
including in-home care, the ability to get provider status in a
way that works for them without a lot of red tape and
bureaucratic complications.
LONG-TERM AND HOME CARE
Are you willing to support that and help us institute that?
That is going to give veterans long-term care and in-home care
in their communities. They can still go to the veteran center
in their State if they want, but it gives them that access to
care in the community, long-term care.
Secretary McDonald. We are very much appreciative for you
introducing that bill. We need these provider agreements. Right
now, we have providers around the country who are refusing to
do business with us because of the Federal Acquisition Rules,
and the cost, the red tape that that adds to their operation.
These small businesses can't afford that. We have, in some
cases, where they are literally threatening to throw our
veterans out of their homes because they do not want to do this
red tape.
So this bill would give us the ability to continue to do
business with them and lessen the Federal Acquisition Rules red
tape for them.
Senator Hoeven. Thank you, Mr. Secretary.
And, Dr. Shulkin, thank you as well. I appreciate it.
Senator Murkowski. Thank you, Senator Hoeven.
Senator Cassidy.
VA HEALTHCARE STAFFING PRODUCTIVITY TO PRIVATE SECTOR
Senator Cassidy. Dr. Shulkin and I had a conversation the
other day regarding best practices, productivity, mental
health. But again, kind of continuing on the theme that I speak
to colleagues, physician colleagues, who work in VAs around the
country, I am told by some that they may see two patients an
hour.
So I mentioned your staffing, some of your budget for
staffing, and their productivity is far less than private
practice. Now, that is important, because obviously the doc
is--but I am sure it is true for the nurse practitioner (NP)
and physician assistant (PA), et cetera.
So first question is, to what degree is the physician
productivity, the PA, the NP productivity, less than the
private sector, both on an average per doc and then
collectively across the system?
And then I guess the next step would be, as we are talking
about staffing, it seems like the better step would be to first
get your systems down so that the physician is seeing 20 or 30
patients a day instead of 14 patients a day, which I gather it
is sometimes even less than that.
So I will toss that out.
Secretary McDonald. Senator Cassidy, we measure
productivity, and we track it very closely. We use the common
industry practice of relative value units (RVUs). Our
productivity is up roughly 9 percent to 10 percent over the
last year.
I would argue that the reason, on an absolute level, we may
seem more less productive is, one, our patients have much more
complex situations.
Senator Cassidy. Now can I challenge you a little bit on
that?
Secretary McDonald. Surely.
Senator Cassidy. Because you are going to have in the mix
the follow-up. I used to see very complex patients and so for
one I would have booked out a 45-minute or even an hour visit,
but it would later come back as a 5-minute visit or even my
nurse walking in, giving the results, and me making sure there
are no questions. So that we I could see four patients in an
hour, five patients in an hour.
Some I am going to challenge you little bit, because they
are not very complex every single time.
Secretary McDonald. I agree. They are not very complex
every single time.
Also, our providers work on a team basis in order to do a
lot of alternative therapies that you would not see in the
private sector.
For example, if our primary care physician and our mental
health professional discover the person has posttraumatic
stress, they may then work with them to get them into
acupuncture or yoga or some----
Senator Cassidy. But that can only be--this limited time,
so I am sorry to interrupt.
That can only be 5 percent or even 10 percent of your
patients. Most of it is going to be straightforward diabetes,
hypertension, cholesterol check, lab check.
Secretary McDonald. Well, when I look over the productivity
numbers, this is what I see.
David practices, so maybe he has a different point of view.
Dr. Shulkin. Yes, Senator Cassidy. First of all, we do
measure on RVUs. The Secretary is correct.
We have increased productivity 10 percent over the past 2
years. But now I have some greater insights into what you are
talking about, since I now have begun to practice as an
internist in the VA.
I get 30 minutes for a follow-up, an hour for new patient.
What you see when you practice in the VA is we are doing a much
more comprehensive approach toward preventative care, screening
for depression, screening for opioid abuse, substance abuse.
So the care that we are delivering in the VA is one of the
reasons why we have such better quality metrics than in the
private sector.
Senator Cassidy. So can I ask?
Dr. Shulkin. Yes.
Senator Cassidy. So again, just going to my field, which
was managing ascites, for example, sometimes I would see them
every 2 to 3 weeks, just to counsel on whether they are on a
sodium restriction, checking creatinine, et cetera.
If I got 30 minutes for every visit every 2 weeks, that
would just gobble up my schedule.
Dr. Shulkin. Right.
VA PATIENT SCHEDULING SYSTEM
Senator Cassidy. So is it automatic, because in your GUI,
by example, graphical user interface, it has a 30-minute block
for everybody. So no matter the complexity, is it possible to
make three patients each 10 minutes or is every single patient
30 minutes?
Dr. Shulkin. Our scheduling system is pretty fixed.
Senator Cassidy. So that, I have to tell you, I used to do
a pretty good job of preventive health, so I will not concede
that you must be so wasteful with time in order to accomplish
everything. Would you agree with that?
Dr. Shulkin. I agree, and I do think it is worth us looking
at that, having a brief visit.
Senator Cassidy. I have to imagine that you could increase
the productivity of your physicians dramatically in both number
of patients per physician as well as--we do not need to hire
more, by golly, we now have it, just by kind of allowing
somebody to say this is really just a follow-up to make sure
they are taking their fluid pills.
Dr. Shulkin. I think we are looking at all of these things
since access is our top priority. So you are identifying
something that absolutely is worth looking at.
I think the Secretary is also correct. What most of our VA
doctors are saying to us is, give us some additional team-based
help. Give us the RNs, the pharmacists, the social workers to
be able to use our time more productively, to be able to get
patients through faster. So it is going to be multifactorial.
I can assure you, we are laser-focused on increasing access
and productivity right now, and we are going to take your
comments back about seeing whether we can adjust for some brief
visits as well, because I agree with you. There are many
patients who come back for simple reasons.
Senator Cassidy. Okay. I yield back. Thank you.
Senator Murkowski. Thank you, Senator Cassidy.
I am now going to turn to Senator Baldwin, and I am going
to pop out and go vote. I am sure we have other members who are
coming back, so you may get more than 5 minutes.
Senator Baldwin. [Presiding.] Oh, terrific. I hope everyone
is as pleased as I am about that opportunity.
Secretary McDonald. We are.
JASON SIMCAKOSKI MEMORIAL OPIOID SAFETY ACT
Senator Baldwin. Especially since I want to start with a
thank you, Mr. Secretary. I very much appreciate your support
for the legislation that I drafted, along with Senator Capito.
I know you are well-familiar with the Jason Simcakoski
Memorial Opioid Safety Act that passed out of the Veterans'
Affairs Committee late last year. I will also note that the
chairman of this subcommittee, Ranking Member Tester, Senator
Murray, are also cosponsors of the bill.
We hope that this bill will pass the Senate and become law
in short order, and I hope that we can count on you for your
continued support and advocacy, Mr. Secretary, to help us move
this across the finish line.
Secretary McDonald. For sure. I believe that we have a
leading role to play in American medicine in showing the way
forward on reducing opioid use and also in preventing suicide.
Senator Baldwin. I appreciate that very much.
I want to turn your attention to an issue that has recently
been subject of many media accounts in my State.
When I am not the only person here, I will ask unanimous
consent to add a number of articles for the record, or maybe I
can just----
Secretary McDonald. I think you are the chairwoman right
now.
Senator Baldwin. I am in charge, so I ask unanimous consent
to enter several news articles in the record. We will hold the
record open so somebody can object if they would like, but I
doubt it.
[The information follows: the requested information was not
available at the time this publication went to print.]
SOCIAL SECURITY NUMBERS AS IDENTIFIER TO VETERANS' RECORDS
Senator Baldwin. Anyways, quite seriously, these articles
detail an incident that occurred last year in Wisconsin when a
VBA employee sent to VSOs at the Wisconsin Department of
Veterans Affairs a spreadsheet that identified 638 veterans
whose claims had been recently closed.
Mr. Secretary, because the spreadsheet contained veterans'
names and Social Security numbers, it was encrypted before
transmission.
I apologize [that I] am going to get into the weeds here,
because I really want to make sure that the facts of what
happened become a part of this record.
Thereafter, one of the VSOs who received the spreadsheet
from the VA forwarded that email to a number of State and
county VSOs so that they could reach out and offer assistance
to the veterans listed. Because the recipients were not
affiliated with the VA and did not have VA email addresses to
which encrypted emails could be sent, the VSO's message was
sent unencrypted.
In addition, although the VA security tools and procedures
generally prevent the emailing of personally identifiable
information without encryption, this transmission was
nevertheless successful because the content did not meet the
criteria that would have otherwise prevented transmission.
One recipient included a veteran who is not a VSO or a
representative of any of those listed individuals. That
individual and his representative alerted the Wisconsin
Department of Veterans Affairs, the media, and my office
concerning the problem.
Mr. Secretary, we can certainly have quite a back-and-forth
about whether the VA bears some responsibility for what
happened, but what I would like to see is the VA discontinue
using Social Security numbers to identify individuals in all
information systems. Until that is done, veterans will be at
risk for identity theft and fraud.
I am going to ask you, Mr. Secretary, what your thoughts
are on this proposition.
Secretary McDonald. I would have to take a closer look at
it, but I can tell you that we take the disclosure of personal
information very, very seriously, even to the point that we
always fault on the side of the veteran. So this is a very
unfortunate circumstance.
I know there was an issue with our software that if the
numbers were strung together without the hyphens, and you and I
are both getting into the weeds on this, that it could go out,
even though it is a Social Security number.
Senator Baldwin. Right.
Secretary McDonald. I know we have taken immediate steps to
fix that, but going all the way to using some other mechanism
other than Social Security numbers to identify an individual, I
would have to get back to you on that.
[The information follows:]
[From Channel3000.com, WISC-TV, News 3, Madison, Wisconsin]
_______________________________________________________________________
(By Adam Schrager)
MADISON, Wis.--The Social Security numbers of Wisconsin veterans
are being sent via email without encryption despite numerous Federal
laws and U.S. Department of Veterans Affairs regulations requiring
personally identifiable information be password-protected.
It partly explains how a random Wisconsin veteran received an
unsolicited email on April 1 with the Social Security numbers and
disability claim information of hundreds of Wisconsin veterans. Since
the Vietnam War, veterans' file numbers or disability claim numbers
have been their Social Security numbers.
``I got up, was working at the computer and had an email from the
Department of Veterans Affairs in Wisconsin. Not knowing what it was, I
opened up the attachment and I panicked,'' the veteran said. ``It was
nine-digit numbers. There were no hyphens. It wasn't like 111-11-111.
It was nine numbers straight.''
A Wisconsin Department of Veterans Affairs spokesperson said the
software program, Ironport, which is used by the Federal VA,
intentionally does not flag nine-digit numbers without dashes because
of the concern that there would be too ``many false positives.'' She
said nine-digit number sequences where dashes are used would require
the person sending the email to encrypt it before it could be sent or
to remove the nine-digit number sequence with the dashes.
The veteran who received the email immediately notified the
Wisconsin Department of Veterans Affairs of its error. He forwarded it,
with the attachment, to his advocate, a retired colonel who used to
work for the WDVA. Together, they notified numerous elected officials
and the Federal VA about what had happened.
``There is absolutely no reason in the world for me to have this
information,'' he said. ``We were told it was an error. We should not
have received that.''
The veteran and his advocate sent an email to the WDVA a week after
the privacy breach stating they would assure the department that they
``(had) not forwarded this very confidential information.'' Kim
Michalowski, who was in charge of the WDVA office that sent the email,
thanked them in a follow-up email for their ``assurances.''
However, any good will between the parties soured when the WDVA,
and subsequently the Wisconsin Attorney General's Office, demanded the
veteran and his advocate destroy all records associated with the
privacy breach. The veteran responded in an email obtained by News 3
that multiple groups were investigating the matter and he wanted to
know if he was being asked to ``destroy evidence.''
His answer came less than a month later when he and his advocate
were sued in Dane County Circuit Court, in an effort to compel them to
destroy all evidence of the email and the attachment. The veteran and
his advocate sought legal counsel, paid to completely scrub their
computers and were forced to sign an affidavit that they had no record
any more of the email and its attachment before the lawsuit was
subsequently dismissed.
``We were told we had to clean them off the computer, off all
servers, off the cloud. My God, how do I do that? I can barely turn on
a computer,'' said the veteran, who is remaining unidentified because
he is fearful of further retaliation. ``I believe the process needs to
be rectified. We have very dedicated veterans out there who need to
have their privacy, their security, respected, and when this kind of
information is released unsolicited, that's a travesty.''
Nine days after the email was sent, WDVA Secretary John Scocos sent
a note to the 637 veterans whose names and file numbers were in the
attachment offering credit monitoring for a year and said the incident
was a ``one-time disclosure to one unauthorized individual, who is a
Veteran.'' However, less than a week after that, the department's own
investigator determined that the data report inappropriately sent on
April 1 had also been sent to ``unaccredited recipients.''
``The email filter, on the U.S. Department of Veterans Affairs
computer network, which typically alerts the sender to this type of
disclosure did not block the sensitive data in this instance,'' WDVA
Communications Director Carla Vigue wrote in a statement emailed to
News 3. ``When we contacted the USDVA Network Security Operations
Center regarding this occurrence, they were already aware of the
problem of certain emails making it past the filter.''
News 3 has learned the April 1 incident is not an isolated one. On
at least three other occasions (June 1, 2014, Oct. 1, 2014 and Dec. 1,
2014), the same data report was also sent unredacted to ``unaccredited
recipients,'' or as defined by the VA, people who are not trained to
view such personally identifiable information. In fact, the
administrator doing the internal investigation is himself
``unaccredited,'' according to USDVA documents, and thus, not supposed
to look at personally identifiable information of Wisconsin veterans
such as the material erroneously sent.
Combined, the four data reports contained the disability claim
numbers of nearly 2,000 Wisconsin veterans. An open records request to
learn who received the emails from June 1, 2014-April 1, 2015, has not
been answered by the WDVA.
``The WDVA has tightened protocols regarding privacy to safeguard
sensitive information,'' Vigue wrote. ``We no longer share the report
in question.''
The internal investigation recommended Michalowski and his
subordinate, Colin Overstreet, who actually sent the email, be
suspended for one day. Both have since left their positions at the
WDVA. Neither Michalowski nor Overstreet agreed to comment on what
happened.
Multiple requests for an on-camera interview with Scocos were
denied. An on-camera interview with his deputy, Kathy Marschman, was
canceled less than two hours before it was scheduled. In a meeting to
discuss an interview, Marschman said protecting the personally
identifiable information of Wisconsin veterans was one of the
department's top priorities, but a review of the department's 2015-16
strategic plan does not mention that.
Secretary McDonald. Danny, do you have any?
Mr. Pummill. The only thing I would add, Senator, is that
when the list was sent out unencrypted, we should not have
relied just on the computer software to catch the serial number
sequences of the Social Security numbers and stop it. The
individual should not have sent out an unencrypted list to
anybody with Social Security numbers on it.
We put extra emphasis on that. We check it constantly now,
and we reiterate to everybody that it is personal
responsibility. You do not rely on software. Under no
circumstances do you send a Social Security number unencrypted.
But we are looking at other ways of modifying it. As you
know, the VA claim number is actually the Social Security
number of the individual, and we are trying to find an
alternate way of doing that.
Senator Baldwin. I hope to work with you in that process.
Other major governmental agencies have made the change from
using Social Security numbers as identification numbers to
alternatives. I understand the scope of that undertaking with
agencies as large as the VA.
But I just want you to know that we are drafting
legislation and seeking your technical assistance. We are
getting that technical assistance, and I hope that we can be
partners in this effort as we move forward.
Secretary McDonald. May I say, Senator, that one of the
things we are undertaking right now is we do not have a single
data backbone within VA, so if you are a veteran and you want
to change your address, you have to do it in about eight
different places, nine different places. One of the things we
have taken on with our new Chief Information Officer (CIO),
LaVerne Council, who is sitting behind me, is creating that
single data backbone.
That would be a great opportunity to move away from Social
Security numbers, because we could put some other kind of
identifier there, and it would simplify everything.
Senator Baldwin. Well, I am all for seizing opportunity, so
I look forward to continuing to work together on that.
As temporary chair of the subcommittee, I would be happy to
now recognize my colleague, Tom Udall, for questions.
Senator Udall. Thank you very much, Senator Baldwin.
Secretary McDonald, it is so good to see you here, and
accompanied by Dr. Shulkin and Mr. Pummill. Thank you, all of
you, for your service to the country and to our veterans. There
could not be a more important task that we undertake.
I fully respect the fact that you took this assignment, Mr.
Secretary, at a difficult time during great publicity around a
serious scandal. Working with Congress and additional
resources, I think you have made some good progress, including
yesterday's announcement that the VA is now able to fund care
for all veterans with hepatitis C. That is a very, very welcome
development there.
We are going to have to keep that up to regain and maintain
the trust of America's veterans, and I know that you all are
committed to that.
I was pleased to meet with you 2 weeks ago and talk about
some of the issues with VA care in New Mexico.
I am also glad to see that the VA budget justification
specifically supports research and exposure to airborne
particulate matter from burn pits. I look forward to an update
on this research as it moves forward on how we can ensure
veterans get the treatment they need for such exposure.
The hearing today is important to discuss ways to improve
the department and its services for veterans. The subcommittee,
as you know, funds your agency and we ensure that this
essential care is ready to support more veterans and, in
particular, the new veterans who are coming home from
Afghanistan and Iraq. We need to make sure that there is a
seamless transition there.
RECRUITMENT OF VA MEDICAL STAFF
Now, my first question, as you know, access is essential
and can be particularly difficult in rural areas like New
Mexico, partially due to problems with retaining practitioners.
How does this budget aim to recruit talented medical staff in
VA facilities? And what can be done, in your opinion, to either
incentivize or streamline the process to hire new doctors and
nurses?
Secretary McDonald. Senator Udall, as you and I have talked
before, having the providers in place is hugely important. I
have been to over two dozen medical schools myself recruiting,
and we have hired over 1,400 doctors since I have been
Secretary.
Nevertheless, I think we have a shortage of medical schools
in this country and one of the things I think also, VA has a
shortage of osteopathic doctors, which is a lost opportunity.
So I would like David to talk about this. We are
increasing, ramping up, our recruiting of osteopathic doctors
and all kinds of doctors nationally in order to recruit them
and get them to particularly operate in rural areas. We know
that osteopathic doctors are more willing to live in rural
areas. They are also more primary care than specialty, which is
exactly what we need.
Senator Udall. Dr. Shulkin, please proceed.
Dr. Shulkin. Yes, thank you.
I think the Secretary is right. We are looking to explore
all avenues. The osteopathic physicians are certainly one
avenue that we are really working hard at, making those
relationships.
We have added new residency affiliations with osteopathic
medical schools, and we are looking to enhance those
relationships. We now have about 300 osteopathic trainees in
the VA healthcare system, and we are looking to expand that.
In addition, because of your support through the Veterans
Access, Choice and Accountability Act (VACAA) legislation, we
have been able to expand residencies desperately needed for
American medicine. When they have a great experience in the VA,
they tend to want to stay in the VA healthcare system. So we
are working on that.
We are using educational debt reduction programs to help
young physicians come in and stay in the VA. That is an
incentive.
And we are looking at our compensation pay tables to make
sure that we are adjusting the pay, particularly for physicians
that we have a very difficult time recruiting in rural areas.
But any help that you could provide us, any ideas that you
have that we are not exploring, particularly with primary care
and mental health in rural areas, we really could use
additional help.
Senator Udall. I was very excited to hear that you all are
working with medical schools and standing up medical schools
and additional residencies, which really make a difference.
As I have told you, we have a new osteopathic school that
is about ready to get going in southern New Mexico that we hope
you will work with.
INSPECTOR GENERAL MISSAL NOMINATION FOR APPROVAL
I want to shift over here to the Inspector General, because
you have asked, and Senator Tester has said, and other others
on the subcommittee have said, how important the Inspector
General is. I would echo what the others have said.
We have to approve your Inspector General. Nothing pushes
that idea more than the fact of what happened as you were
coming in.
I worked in New Mexico, I had many people approaching me
and saying there are problems going on, there are scheduling
problems, there is this, there is that. We did not have the
expertise to deal with it, but we were able to take the
information, work with the complainants, get them into the
Inspector General, and then have the Inspector General work
with them and do a report to you. So I think we need to find a
way.
I would call on everybody to remove those holds and put the
Inspector General in place for the Veterans Administration.
How do we strengthen employee trust in the VA Office of
Inspector General (OIG) operation?
Secretary McDonald. One of the things we have done is
through our Leaders Developing Leaders program, which I
discussed earlier, we have taken our top 450 leaders offsite.
We have done 3 days of training. Part of that training is in
values and, importantly, in the values of the Inspector General
and the role the Inspector General plays.
We have also tried to partner with the Inspector General,
so we are working together. So we are helping the Inspector
General identify trouble spots, because during the time of
change, like we are having with the transformation, the MyVA
transformation, that can create challenges for us. So we want
the Inspector General to be vigilant on where those challenges
are.
But just for an example, we have had over 110
investigations just on scheduling alone. Of those 110-plus,
only 77 have been completed. Of those 77, we have had roughly
10 sites that have been discovered problematic, and 28
individuals that we have had disciplinary action against.
So it shows you the enormity of what we are talking about
and also the fact that we are not done yet. We still have a lot
of work to do.
ALBUQUERQUE VAMC MEDICAL INVESTIGATION REPORT
Senator Udall. Secretary McDonald, just one more brief
question. I understand that you recently signed off on a
medical investigator report pertaining to the Albuquerque VA
medical center. Can you provide the details of the three
recommendations contained in the report? And when will you be
able to share that report with me and release it publicly?
Secretary McDonald. I think David has the report, Senator.
Dr. Shulkin. This is concerning allegations with the
appropriate use of using psychological testing, particularly
for traumatic brain injuries. We have seen the initial draft
report.
We will be able to get you a specific date that it will be
able to be released to you and make sure that we do that. In
fact, I think we may be able to get you a redacted report even
sooner than its official release date. We will be glad to do
that.
I will tell you that when I have reviewed the report, I am
comfortable with the findings in terms of what was
substantiated and what was not substantiated, so that we do not
feel at VA that we need to take immediate action right now for
patient safety, or else we would be taking that action.
[The information follows: the requested information was not
available at the time this publication went to print.]
Senator Udall. Great. Thank you, Dr. Shulkin, very much.
I will submit my additional questions for the record,
because my time has expired. One is on 3-D printing and the
other is on Comp and Pen, which I think you all have discussed
very thoroughly here.
I yield back, Mr. Chairman.
Senator Kirk [presiding]. Thank you, Mr. Udall.
HINES VAMC WAIT TIMES DATA
I requested all documents the VA had about wait time abuse
at Hines VA. Did you bring those documents?
Secretary McDonald. I do not have them with me, Senator,
but we will get them to you.
David may have them.
Dr. Shulkin. Senator, I apologize. I did not see a specific
request from you, but I do have the current wait times data at
Hines VA that I will be glad to leave with you and share with
you.
Senator Kirk. Thank you.
HINES VAMC INSPECTOR GENERAL INVESTIGATION
As I mentioned earlier, the Office of Special Counsel wrote
to the President in defense of Germaine Clarno, that the
Inspector General investigation was ``incomplete'' and ``failed
to address the whistleblower's legitimate concern about access
to care for mental health patients at Hines.''
Let me tell you what this means in real life. My
constituent Army specialist Tom Young served twice in Iraq with
the 10th Mountain Division. At Hines, he asked for help with
his posttraumatic stress disorder (PTSD). Two times, Hines
turned Tom away because he was ``not suicidal.''
After a suicide attempt, Tom went back to Hines, and they
did not have room for him. Tom laid down on the Metra tracks in
Prospect Heights on July 20, 2015.
Two days after Tom killed himself, your own Office of
Accountability Review said no additional investigation is
required of Germaine's complaints that were addressed by the
Inspector General. The Chief of Staff agreed.
Another constituent of mine, Army veteran Michael Swan
waited over a year to see a neurologist and a year to see an
endocrinologist. Even worse, doctors gave him a clear
colonoscopy report showing no polyps. He then went to a
civilian doctor later, and the doctor found 130 polyps.
The VA is saying that Germaine is wrong about Hines wait
times in the mental health department, yet the Office of
Special Counsel has criticized the Inspector General, saying it
was ``willfully ignorant about the allegations.''
Do you still stand by your Office of Accountability Review
report on this matter?
Secretary McDonald. First, I think it is important to say
that any veteran suicide is unacceptable. We all take it deeply
personally, all of us, myself, yourself, being veterans.
So that is one of the reasons we held the suicide
prevention summit that we held in February, to see what more we
can do, what more can all us do as a community in order to
eliminate the possibility of any veteran committing a suicide.
It was March 8, just a couple days ago, where we put out a
press release of the steps we are going to take in order to
increase our suicide prevention program. It is incredibly
important.
Relative to mental health at Hines, the average wait time
is 4.3 days. If that differs from what Germaine thinks it is, I
would love to talk with her again.
As I told you, we have our Office of Medical Inspector at
Hines now, trying to reconcile the difference between the
Inspector General reports and what the Office of Special
Counsel found. Our Deputy Secretary is digging deeply into
this. We will contact Germaine to get more information.
[The information follows: the requested information was not
available at the time this publication went to print.]
Senator Kirk. Thank you.
Secretary McDonald. Yes, sir.
VETERANS CRISIS LINE CONTRACTOR
Senator Kirk. Let me follow up with Dr. David Shulkin.
You were here last week and testified about the veterans'
crisis line putting new people in charge. I wanted to get the
name of the contractor who was handling that voicemail that
dealt with my constituent. Do you have the name of that
contractor?
Dr. Shulkin. I do. Link2Health, with the number two,
Link2Health.
Senator Kirk. Link2Health. Are they still working on the
veterans' crisis line?
Dr. Shulkin. Yes, they are a backup contractor.
Senator Kirk. And since they have messed up Tom's call, why
are they still hired?
Dr. Shulkin. Well, after the issue was discovered with the
voicemails, we went back to them and we put in new stringent
requirements as part of the contract, and they have been
adhering to that. There is no voicemail being used today.
Senator Kirk. Good. Thank you.
Ms. Murkowski.
CHOICE PROGRAM IN ALASKA
Senator Murkowski. Thank you, Chairman.
Secretary, I think this is the first time that we have seen
one another since you visited us in Alaska. I appreciate your
willingness to be there in Wasilla at an open mike. I think you
got it unfiltered from our veterans.
You had some time since that visit to kind of process not
only what Alaska veterans have said, but obviously veterans
around the country.
Dr. Shulkin was here before the subcommittee last week. We
had an exchange back and forth about the failings of the Choice
program in Alaska.
Kind of the short sum of it was that Alaska VA healthcare
system had long been resistant to sending patients to community
facilities. They viewed that a better alternative was to send a
vet all the way down south to Seattle rather than just using
the services there at the Fairbanks Memorial.
Your predecessor, Secretary Shinseki, worked with us. We
really thought we were on the road to that model VA health
system. Then the Phoenix incident comes around.
Now, our veterans are saying very clearly, very loudly, our
VA health system in Alaska is a mess. I referred to it last
week as chaotic.
Without exception--without exception--the veterans who are
talking to me say we need to ditch Choice, we need to go back
to what we had built where VA have identified community
providers, wrote referrals, paid the bills. It was a system
that worked.
So I am concerned with the various proposals out there that
we are seeing that ``consolidate community care.'' We do not
want to participate in a national consolidated program. Those
are all the buzzwords that just do not work for us.
We need a program that is like what we had, which is
custom-developed for the fact that we are noncontiguous; we are
highly rural; we have a mismatch between demand for providers,
which is very, very high, and the supply of providers, which
is, unfortunately, terribly low; and because our medical
community is really self-sustained within the State.
So we do not want to be part of this consolidated national
program. It scares me to death.
Given what you heard in Alaska, given the conversations
that we have with Dr. Shulkin, how can we do this? How can we
draw outside the lines, because that is what we have to do with
Alaska? That is what we have to do, I think you know--a way we
can figure out this integrated system of VA health system that
works for Alaska.
I do not expect you to have the full answer in 2 minutes,
but we need to have a better understanding as to where we are.
Secretary McDonald. Believe it or not, I do have an answer,
because as we put this program together, consolidated care,
this network of great providers, it is with the learnings from
Alaska as part of it.
We need to have in that network the Alaska Native Health
System. We need to return to all the things we had before
Choice. The problem with Choice was it created--it was well-
intentioned----
Senator Murkowski. It was non-Choice.
Secretary McDonald. It was non-Choice. It created a single
entry point call to a third-party administrator where you had
the veteran given a phone number. And I know that does not
work. I mean, I was in Alaska. I went up to Point Hope to watch
how the Alaskan health system worked.
We need to get back to where we were in Alaska. This bill
will do to that or we are not advocating it. So that certainly
is our intention.
Senator Murkowski. Well, okay. You are saying that this
bill gets us there. I need to know that we are all in agreement
as to where there is, because your words are good. I think you
recognize it and you see. But again, part of the frustration
that our veterans have right now is that they saw how we had
corrected a system that had failed our vets for years.
We built it, and then it was disassembled literally in a
matter of months. So what I need to hear from you is that you
agree that where we were before Choice came on is where we can
get back to, and that is the direction that you want to take a.
Secretary McDonald. That is certainly the direction I want
to take it, and I am going to make sure that is built into any
bill, because I thought the Alaska system, and it worked. It
was Choice. It did provide choice.
David, do you want to say anything?
Dr. Shulkin. I think, very specifically, we want to bring
back the customer service piece. The Alaska VA staff had a
great relationship with Alaska providers, the Southcentral
Foundation, as well as the Indian Health Service, and other
Federal programs up there.
We also had a great relationship with our veterans, and we
want that back.
Senator Murkowski. You know that you do not have it now.
Dr. Shulkin. No, we are working hard to repair all the
damage that happened up there, and there has been a done a lot
of damage. There is no question. Both the Secretary and I heard
this personally when we were up there.
VA HEALTHCARE OPERATIONAL ISSUES IN ALASKA
Senator Murkowski. Let me ask about that then, just with
regard to the day-to-day operations, because I think this
really goes a long way to improving that relationship, to
rebuilding that credibility.
We are sitting with a situation where, once again, we do
not have a permanent director. We have not had one since Susan
Yeager left. I personally think it was a tragedy that we could
not keep her. I do not think I have met the director of the
Northwest network.
We are having a difficult time with provider attrition. We
are still having serious issues with provider recruitment.
Again, it is not that we can't figure this out. The Alaska
Native Health Care System has figured it out. They seem to be
up to keeping folks. VA cannot keeping folks. I do not
understand why.
On a month-to-month basis, we do not know how well or how
poorly our community-based outpatient clinics (CBOCs) are
operating. We have a revolving door of providers there. We have
low morale. We have fear of retaliation.
So I hear what you are saying about what we have to do, but
you have a whole series of strikes against you right now that
are going to make it hard to ensure that that veteran feels
like, okay, we are back on the right track.
At a minimum, it seems to me that we have to have some kind
of framework for measuring the performance of what is going on.
I do not know on a month-to-month basis whether our local VA
system is improving or whether it has just entirely collapsed.
So is that something that you are considering and trying to
put in place as you are looking at the bigger picture of how we
get back to where we once were?
Dr. Shulkin. Senator, I do not think that we have the time
to go into the very specifics now. I will say that your
assessment of the local VA situation is probably somewhat
different than mine. We do have a lot of metrics. We have an
excellent acting director, Linda Boyle, there. I would love to
have you spend some time with her.
Senator Murkowski. I know Linda well.
Dr. Shulkin. Right. We have a search going on. We will name
a permanent director in the very near future.
I have been there. The care at the VA is truly excellent.
We have statistics we will be glad to show you.
The problem is our reputation has been hurt incredibly, and
you are hearing it from the veterans because the Choice program
has not worked. That is what we are working very, very hard
right now to repair with TriWest. They have been working very
hard with us to do that.
But we need these legislative fixes to fix the program once
and for all.
So we will reach out to your staff and sit down and review
those statistics with you. We have a lot of data on Alaska.
Senator Murkowski. Well, I appreciate the statistics. But I
also know that when I am sitting on an airplane with a veteran,
he is not talking statistics. He is talking about his care. He
is talking about how he was treated. He is talking about what
it meant for him to basically feel like there was no response.
So I appreciate statistics. I know that we have to be
paying attention to that. But I need to make sure that we have
providers that we can recruit and we can retain. I need to make
sure that we have a level of responsiveness that is more than
just scheduling an appointment. It is one thing to say, yes, I
got an appointment. It is another thing to get the care that
our veterans have clearly earned.
So know that we need to stay very closely engaged with
this, and we certainly intend to do that.
Secretary McDonald. Senator, I would like to send over our
team working on this new bill and make sure that we are
aligned, that this will include the Alaska Native Health System
and all the needs that we were able to address with the
previous system.
Senator Murkowski. I would look forward to sitting down
with your folks. I appreciate that.
Thank you, Mr. Chairman.
Senator Kirk. I would like to ask Secretary McDonald for
you, when you come to Chicago, to meet with Germaine and the
Hines staff. I would like you to commit to that.
Secretary McDonald. I have not been to Hines yet. I would
like to go.
ADDITIONAL COMMITTEE QUESTIONS
Senator Kirk. Thank you.
I think with that, we will thank our witnesses and thank my
partner, Senator Tester.
The hearing record will remain open until the close of next
week. Members may submit questions at any time they want, until
that time.
[The following questions were not asked at the hearing, but
were submitted to the Department of response subsequent to the
hearing:]
Questions Submitted to Hon. Robert A. McDonald
Questions Submitted by Senator Mitch McConnell
Question. I am very concerned about the recent reports of
dysfunction and wrongdoing at the Cincinnati VA Medical Center,
particularly as a number of my constituents rely on this facility for
medical care. I understand the former VISN 10 Director recently
resigned and the former Director of the Cincinnati facility has been
removed. Are either of these individuals receiving benefits or
salaries? What steps is the VA undertaking to correct the failures of
leadership at this facility to ensure veterans are receiving the
quality care they were promised and deserve?
Answer. The previous Director of the Cincinnati VA Medical Center
(VAMC), Linda D. Smith, retired December 2, 2014, and she receives
retirement benefits commensurate with her service. John Gennaro became
Director of the Cincinnati VAMC in July 2015, but he recently accepted
an assignment to another facility as Director. Mr. Gennaro was not
implicated in any allegation of wrong doing, and he currently receives
a salary and benefits as appropriate to his new position. The current
interim Director of the Cincinnati VAMC, Glenn Costie, is not
implicated in any allegation of wrong doing.
The former Director of Veterans Integrated Service Network 10, Jack
Hetrick, retired February 24, 2016, and receives retirement benefits
commensurate with his service.
To ensure quality care for our Veterans through our leadership
means sustainable accountability in them and our supervisors. We will
recognize what is going well and provide coaching and re-training where
improvements are necessary. We will train our leaders to lead and our
employees to exceed expectations and if not take corrective action when
it's warranted and supported by evidence.
Question. Please provide an updated timeline for the design and
construction phases of the Louisville VAMC--and ultimately for the
facility's completion. This project was announced in 2006, and
Kentucky's veterans have had to wait for too long to begin receiving
care at this new facility.
[Clerk's Note: The Department was unable to submit a response to
this question.]
Question. In June 2014, the VA Office of Inspector General (OIG)
was directed to conduct investigations of more than 100 VA medical
facilities regarding potential scheduling manipulation practices,
including at Kentucky's Fort Knox and DuPont VA facilities. What is
that status of the OIG investigations of these facilities, and when
will they be completed? I would ask that you please share any available
information with my office regarding the investigation findings at
these Kentucky facilities.
Answer. VA's OIG Report on Kentucky facilities was released, and
summaries are provided below. VA's OIG did not find evidence to
substantiate the allegations.
------------------------------------------------------------------------
------------------------------------------------------------------------
Louisville KY-2014-2890-DS-53.......... No intentional manipulation
substantiated.
------------------------------------------------------------------------
Louisville KY-2014-2890-DS-56.......... No intentional manipulation
substantiated.
------------------------------------------------------------------------
Question. As the VA continues with reform efforts to improve and
expedite healthcare for our Nation's veterans, does the agency need any
additional authority from Congress to remove bad actors from the VA?
Answer. On March 23, 2016, the Secretary of Veterans Affairs
submitted a legislative proposal to Congress entitled, ``Department of
Veterans Affairs Accountability Enhancement Act.'' This legislation
would provide VA with the authority it needs to recruit, compensate,
appraise, and, when necessary, discipline career healthcare executives
to ensure that VA can operate as a values-based, high performance
organization.
Question. Mental health issues remain a significant concern for
many veterans. Are there any additional resources or authorities that
the VA needs from Congress in order to provide effective treatment and
care to veterans with mental health issues?
Answer. With the current resources and authorities, VA continues to
be the largest integrated healthcare system in the United States, with
numerous reports validating the quality of mental healthcare services.
This is the result of a long history of research, academic
affiliations, and a deep commitment to training and recruitment. For
example, Psychiatric Services, a peer-reviewed journal of the American
Psychiatric Association, has published a report comparing the quality
of mental healthcare provided by VA to Veterans with a comparable
population in the private sector. According to the study, ``in every
case, VA performance was superior to that of the private sector by more
than 30 percent. Compared with individuals in private plans, Veterans
with schizophrenia or major depression were more than twice as likely
to receive appropriate initial medication treatment, and Veterans with
depression were more than twice as likely to receive appropriate long-
term treatment.'' \1\
---------------------------------------------------------------------------
\1\ The Quality of Medication Treatment for Mental Disorders in the
Department of Veterans Affairs and in Private-Sector Plans, Katherine
E. Watkins, Brad Smith, Ayse Akincigil, Melony E. Sorbero, Susan
Paddock, Abigail Woodroffe, Cecilia Huang, Stephen Crystal, and Harold
Alan Pincus Psychiatric Services 2016 67:4, 391-396.
---------------------------------------------------------------------------
Additional resources and authorities are needed from Congress in
order to maintain this leadership and to provide effective treatment
and care to Veterans with mental health problems. Among other
priorities, VA needs to explore all potential resources for recruiting
and retaining high caliber mental health providers, including the
availability of education debt reduction programs (EDRP). Most
recently, through the Clay Hunt Suicide Prevention for American
Veterans Act, new EDRP efforts have focused on psychiatry, but no
additional funding was provided. Further, such incentives need to be
broadened to other clinical specialties in short supply including
psychologists. Funding EDRPs is a partnership between VA Central Office
and local VA healthcare facilities.
The delivery of effective mental health treatment and care is best
managed within a predictable funding strategy matched to the evolving
needs of Veterans. Legislative requirements without additional
appropriations not only limit VA's ability to act upon new mandates but
also limit VA's ability to focus on/implement solutions in response to
other key priorities. The Clay Hunt Act, as an example, did not provide
additional appropriations while imposing multi-million dollar,
multiyear obligations which could only be met by diverting funding from
other important projects including suicide prevention projects.
VA recognizes that to be effective in reducing Veteran suicide, VA
must continue to develop Federal and community strategic collaborations
that reach deep into all Veteran communities. To support this effort,
VA stood up the Office of Suicide Prevention. The VA Suicide Prevention
Office will create new inter-agency and public- private collaborations
in order to reach each of our Nation's 22 million Veterans.
VA recognizes Congress as an important partner in preventing
suicides. This partnership will be supported by reoccurring
congressional briefings on the Office of Suicide Prevention's plans of
action. Congress' feedback as well as working with their local
districts across the Nation will be crucial to this effort.
VA practitioners report that they value being able to employ the
full spectrum of their clinical skills and using interventions that are
evidence based while practicing in VA. This requires an on-going
requirement to train staff on emerging practices and create teams of
providers to allow everyone to work within the scope of their unique
area of competence. Over recent years, the addition of Peer Specialists
has brought an additional resource to the healthcare team, has helped
to combat any stigma associated with asking for mental healthcare, and
has provided the opportunity to reach Veterans and Servicemembers (for
example, Active Duty members seeking care after Military Sexual Trauma)
who may otherwise go untreated.
Ongoing training and education of VA mental health practitioners
and Peer Specialists contributes to staff retention and helps to ensure
that Veterans have access to state of the art mental healthcare.
Question. It has been brought to my attention that some VA
healthcare facilities lack the capability to provide care that meets
the specific medical needs of female veterans. With this in mind, what
efforts is the VA taking to ensure that all of its healthcare
facilities are fully equipped to provide care to female veterans? What
plans are being made in this regard for the new Louisville VA Medical
Center?
[Clerk's Note: The Department was unable to submit a response to
this question.]
Question. Many Kentucky veterans have expressed concerns that as
the VA continues its efforts to reduce the agency's backlog of pending
claims that there is now a growing backlog of claims appeals. What
efforts is the VA taking to continue reducing the claims backlog while
also ensuring that veterans' appeals are processed in a timely fashion?
Does the VA need any additional authority from Congress to assist with
the reduction in either of these backlogs?
Answer. The Veterans Benefits Administration (VBA) has reduced the
number of disability compensation claims pending more than 125 days by
87 percent, from a peak of 611,000 in March 2013 to a historic low of
79,004 claims, as of March 31, 2016. VBA's process and enhanced
technology improvements, such as the Veterans Benefits Management
System (VBMS) and the National Work Queue (NWQ), continue to provide
increased efficiencies in the electronic claims process. By modernizing
to an electronic claims processing system, VBA has increased claim
productivity per claims processor by 25 percent since 2011 and medical
issue productivity by 82 percent per claims processor since 2009. To
continue this progress in 2017, VBA will build on the success of its
transformation initiatives to further streamline and modernize the
claims process with enhanced automation through VBMS, electronic
workload management through NWQ, centralized mail, and the Veterans
Claims Intake Program, which aims to further streamline and modernize
the claims process.
With VBA's completion of record-breaking numbers of disability
rating claims in recent years, a concomitant increase in the volume of
appeals resulted. While VBA continues to prioritize rating claims, it
is also placing additional focus on appeals. VBA is grateful for the
funding that allowed us to hire 100 appeals full-time equivalents (FTE)
in fiscal year 2015 and 200 appeals FTEs in fiscal year 2016. As of
February 2016, VBA has increased its appeals workforce from 1,195
employees to over 1,490 employees and allocated $10 million in overtime
funds to support the appellate workload. In addition, we are leveraging
our technology initiatives in support of modernizing the appeals
process. However, VA will not be able to provide Veterans with timely
decisions on their appeals without legislative reform to streamline and
modernize the current appeal system. In the President's budget for
fiscal year 2017, VA requested resources to lower the pending inventory
of appeals and proposed legislation to simplify the appeals process. VA
is working closely with Veterans Service Organizations, other Veteran
stakeholders, and Congressional staff to develop legislative proposals
that would achieve our shared goal of timely and high quality appeal
decisions.
Question. In the summer of 2016, the Army is scheduled to begin
construction of a new medical facility to replace the Ireland Army
Community Hospital (IACH) at Fort Knox, Kentucky. Does the VA have a
plan to replace the Fort Knox VA facility currently located at IACH to
ensure area veterans see no disruption in care currently provided at
this facility?
Answer. This new VA Clinic is necessary as a result of the Army's
plans to build a new healthcare facility to replace the existing
Ireland Army Community Hospital (IRACH). Currently, VA occupies space,
via a sharing agreement, within the existing IRACH. However, VA will be
unable to co-locate services within the Army's new healthcare facility
because DoD and VA are not allowed to share appropriated funds for
joint facility projects. In order to continue to provide healthcare to
Veterans, VA seeks to obtain a permit from the Army and then build a
separate clinic adjacent to the new Army healthcare facility. VA
contemplates that the VA Clinic will be physically connected to the new
Army health facility, through a covered walkway or other structure, and
offer primary care and mental health services to Veterans in the Fort
Knox area.
Current law does not allow for detailed planning/design,
construction, or leasing of shared medical facilities that are not
specifically under the jurisdiction of the Secretary, or for
appropriated funds to be transferred to, or retained from, DoD or other
Federal agencies for use in joint capital projects with VA. VA has
proposed legislation (described in VA's fiscal year 2016 and fiscal
year 2017 budget submissions and developed in consultation with DoD)
that would provide for the inherent authority to do more detailed
planning and design, leasing, and construction of joint facilities in
an integrated manner. However, such legislation has not been enacted.
Accordingly, VA lacks the authority to permit capital investment for
shared medical facilities.
Earlier this year, VA began negotiating a permit with the Army to
provide VA with the necessary access to the Army's land for
construction and occupancy. The permit is for four acres in order to
accommodate the building footprint and necessary parking. The Army has
taken the lead on drafting the permit. A design-build contract was
awarded to the United States Army Corps of Engineers (USACOE) for the
construction of the VA CBOC in September 2016. An Architectural-
Engineer (A/E) firm is drafting the final request for proposal (RFP) to
be completed by March 2017.
Question. Substance abuse disorders, particularly opioids, continue
to be a challenge for many veterans. What steps are being taken by the
VA to improve education, monitoring and treatment of addiction? Does
the VA need any additional authority from Congress to better coordinate
care for veterans with substance abuse issues?
Answer. Providing additional funding to expand recruitment
incentives, such as loan repayment for psychiatrists and other mental
health providers, would be helpful in attracting and retaining
addiction treatment providers in what is currently a highly competitive
market in many locations.
Currently, VA is engaged in multiple efforts to improve education,
identification and monitoring for substance use disorder (SUD) in
patients, including those Veterans with chronic pain. VA has been
working to expand access to evidence-based pharmacological and
psychosocial addiction treatment services. This includes national
training initiatives in evidence-based psychotherapies, such as
cognitive behavioral therapy for substance use, motivational
interviewing, and motivational enhancement therapy, which have been
shown to effectively treat substance use disorders. VA, in concert with
the 2011 Institute of Medicine (IOM) Report, Pain in America, and the
National Pain Strategy from the Department of Health and Human Services
(HHS), published in 2016, has recognized that improved competency in
pain treatment across our health systems will lead to less reliance on
opioid therapy, less exposure to the potential harms of opioid therapy,
and better patient outcomes. To support these goals, VA and the
Department of Defense (DoD) have developed the Joint Pain Education
Program for primary care providers, a 31 module, evidence-based,
comprehensive pain management curriculum that includes training in the
appropriate screening for SUD in Veterans with chronic pain, and
training in the safe use of opioids, including SUD monitoring.
VA, as part of its Opioid Safety Initiative (OSI), has created
multiple tools and processes to help clinicians identify SUD in
Veterans being treated for chronic pain before and during treatment
with opioid analgesics, to monitor their clinical outcomes, and ensure
referral to appropriate treatment to reduce risk of activating SUD, or
to manage SUD when it is co-morbid with chronic pain. Such tools and
procedures include:
--The Opioid Therapy Risk Report (OTRR), which provides detailed
metrics on all the risks and strategies for managing risk for
Veterans prescribed long-term opioid therapy for pain. The OTRR
metrics are available in the clinic on the electronic medical
record to support providers' efforts to monitor and manage
risks when caring for patients with chronic pain who are
prescribed long-term opioids.
--VA developed predictive model-based clinician decision support
tools which are available nationally. The Stratification Tool
for Opioid Risk Mitigation tracks patients receiving opioid
analgesics or with opioid use disorders, estimates risk of
overdose or other adverse events, flags prior non-fatal
overdose and suicide-related events, identifies personal risk
factors, and suggests and tracks use of patient-tailored risk
mitigation strategies and non-pharmacological pain treatments.
Suggestions include a variety of guideline recommended
strategies, including avoidance of high dose prescribing and
risky medication combinations; timely follow-up; medication
reconciliation; side-effect management; screening for substance
use; ensuring mental health assessment and addiction treatment
when needed; and use of physical therapy, Integrative Health,
and behavioral therapies. It additionally provides information
about patients' care providers and appointments to facilitate
care coordination. The tool can be used to improve the safety
of care for individual patients, or on a population level to
facilitate systematic application of specific risk mitigation
strategies to patients with the greatest risk of overdose or
suicide-related events.
The OSI Toolkit, developed and maintained by an interdisciplinary
expert pain task force provides evidence-based guidance and trainings
to help clinicians manage pain and opioids safely, including clinical
guidance on safe medication tapering.
Additionally, VA has been working to expand access to medication-
assisted treatment (MAT) for opioid use disorders since fiscal year
2000. VA efforts have included specific funding for hiring Addiction
Medicine specialists to expand MAT access in under-served areas,
clinical mentorship programs to support newly trained buprenorphine
prescribers, a technical assistance program consisting of monthly
webinars and email consultation, and on-going management monitoring,
attention, and action planning regarding meeting needs for MAT
services. As a result, VA has substantially expanded access to MAT from
just under 12,000 patients (27 percent of those diagnosed with opioid
use disorders (OUD)) in fiscal year 2010 to over 20,000 patients (30
percent of those diagnosed with OUD) in fiscal year 2015. In the fourth
quarter of fiscal year 2015, 35.4 percent of OUD patients received MAT
(methadone, buprenorphine or injectable naltrexone). Prioritization of
expansion of MAT services is encouraged by inclusion of MAT access
measures on leadership performance plans and as part of VA's
Psychotropic Drug Safety Initiative. VA continues to work to expand MAT
access in locations with lower capacity or barriers to access to
services (e.g. rurality), including through innovative models such as
group practice visits and telemental health models.
The Ryan Haight Online Pharmacy Consumer Protection Act generally
requires that VA telehealth providers must have at least one in-person
medical evaluation prior to prescribing controlled substances via
telemedicine.
This can be a problem when VA telehealth providers are not located
close to the Veteran or when the Veteran's provider retires and another
provider needs to begin furnishing care to the patient. We believe that
the Drug Enforcement Administration could assist VA with this issue
through the regulatory process; however, Congress could also assist by
granting VA telehealth providers special authority to prescribe
controlled substances without having conducted a prior in-person
medical evaluation.
We note that on July 22, 2016, the President signed into law the
Comprehensive Addiction and Recovery Act of 2016 (Public Law 114-198),
which authorizes a range of measures intended to combat opioid
addiction and overdoses. We are working to implement the provisions of
this law affecting VA. For example, the law requires all practitioners
(including VA) to certify certain information when registering to
prescribe controlled substances; VA must establish guidance that each
provider must use the Opioid Therapy Risk Report tool before initiating
opioid therapy to treat a patient; VA must require all employees
responsible for prescribing opioids to receive education and training
on pain management and safe prescribing practices; and Each VA medical
facility director must identify and designate a pain management team of
healthcare professionals. We will alert the Committees if we identify
any legislative changes that are needed as a result of these new
authorities.
______
Questions Submitted by Senator Susan M. Collins
dysfunctional continuum of care--choice program
Question. I have heard from veterans, veteran services
organizations, and VA officials that the Choice Program's continuum of
care process is broken and dysfunctional.
Last month, the entire Maine congressional delegation sent you a
letter regarding the VA's incredibly flawed administration of the
Choice Program in our State. According to the Department's own data,
fewer than 50 percent of eligible Choice Program patients in Maine have
received the appointments they need and have requested. The contractor
chosen by the VA, Heath Net, has performed poorly. The process to
correct many of the issues with Choice may take years. In the meantime,
there are veterans in rural communities waiting to receive access to
desperately needed care.
Can you provide an assurance regarding when these veterans can
expect to receive the appointments they need?
Answer. VA is continuing to examine how VCP interacts with other VA
health programs, including the delivery of direct care. In addition, VA
is evaluating how it will adapt to a rapidly changing healthcare
environment and how it will interact with other health providers and
insurers. VA anticipates improving the delivery of community care
through incremental improvements as outlined in the October 30, 2015,
Plan to Consolidate Community Care Programs, building on certain
provisions of the existing VCP. Implementation of these improvements
requires balancing care provided at VA facilities and in the community,
and addressing increasing healthcare costs. VA is committed to
improving Veteran's health outcomes and experience, as well as
maximizing the quality, efficiency, and sustainability of VA's health
programs.
Relevant to Maine Veterans, the ARCH program expired on August 7,
2016. Veterans who participated in the ARCH program will continue to
receive care under VCP and will be eligible for same services that ARCH
offered. Veterans who did not previously participate in the ARCH must
meet the Choice eligibility criteria (living 40 miles away from a VA
facility with a full time primary care physician or a VA facility is
not able to provide needed care within the wait time goals of the
Department (30 days)). VCP should work to expand the availability of
hospital care and medical services for eligible Veterans. We continue
to work with our VCP contractor in Maine, HealthNet, to recruit more
eligible VCP providers to improve VCP and help us ensure that all
Veterans in Maine have access to care. VA has also begun using VCP
Provider Agreements in Maine to improve our ability to get our Veterans
timely appointments with eligible community care providers.
Effective care coordination is critical to enabling a Veteran-
centric care experience and supporting positive health outcomes through
clear continuity of care and appropriate care and disease management.
Under VA's ``Plan to Consolidate Community Care Programs,'' VA would
define a clear process for transfer of medical documentation between VA
and community providers when Veterans are referred into the community.
VA would also establish objectives, roles, and processes for care
coordination to enable a smooth Veteran experience across VA and
community providers. The care coordination process would be centered on
Veterans' relationships with their PCP. The PCP and supporting
coordinator staff, whether at a VA facility or in the community, would
assist Veterans with basic care coordination and patient navigation
regarding scheduling appointments and seeking appropriate follow-up
care. Veterans receiving care from community PCPs that do not have the
capacity or capability to provide required coordination would be able
to rely on VA for those services. For Veterans requiring more robust
care coordination, regardless of whether they see a VA or community
PCP, VA would provide programs for care and disease management and case
management, as appropriate. This model would integrate with and utilize
established and evolving care coordination models at VA, such as the
Patient Aligned.
va participation in prescription drug monitoring program
Question. Prescription opioid and heroin abuse has reached epidemic
proportions in our communities. A recent study estimated that nearly
one million veterans are taking prescription opioids and more than half
use them ``chronically'' or beyond 90 days. Although these
prescriptions may be necessary to a patient's care, another study noted
that the risk of death by accidental overdose among patients at
Veterans Administration facilities is nearly twice that of the non-
veteran population.
Prescription drug monitoring programs, or ``PDMPs,'' are one of the
most important tools available to confront and prevent prescription
opioid abuse. These State systems can give doctors crucial information
about a patient's prescription drug history, particularly when patients
are receiving care both inside and outside of the VA system. VA
healthcare providers have the authority to share information with State
PDMPs, but they are not required to do so, and participation varies
widely across the country. For example, in Maine the VA Health Care
System reports to and queries the State PDMP, but this was a long time
coming and is not the practice in all States.
Has the VA considered establishing standards for PDMP use among
prescribers and pharmacies in the VA system?
Answer. Prescription opioid and heroin abuse has reached epidemic
proportions in our communities. A recent study estimated that nearly
one million veterans are taking prescription opioids and more than half
use them ``chronically'' or beyond 90 days. Although these
prescriptions may be necessary to a patient's care, another study noted
that the risk of death by accidental overdose among patients at
Veterans Administration facilities is nearly twice that of the non-
veteran population.
Prescription drug monitoring programs, or ``PDMPs,'' are one of the
most important tools available to confront and prevent prescription
opioid abuse. These State systems can give doctors crucial information
about a patient's prescription drug history, particularly when patients
are receiving care both inside and outside of the VA system. VA
healthcare providers have the authority to share information with State
PDMPs, but they are not required to do so, and participation varies
widely across the country. For example, in Maine the VA Health Care
System reports to and queries the State PDMP, but this was a long time
coming and is not the practice in all States.
Question. Has the VA considered establishing standards for PDMP use
among prescribers and pharmacies in the VA system?
Answer. The Veterans Health Administration (VHA) is developing a
policy, VHA Directive, Querying State Prescription Drug Monitoring
Programs, which will govern the querying of State PDMPs by VA
providers. The policy will establish a minimum standard for querying
PDMPs and ensure compliance with applicable Federal and State laws. It
is anticipated that this policy will be published in mid-fiscal year
2017.
In addition, VA's Virtual Lifetime Electronic Record Health program
continues to actively partner with the eHealth Exchange to encourage
PDMPs to move towards the use of national standards for the exchange of
opioid prescription information. As PDMPs adopt these national
standards, it will enable a bi-directional exchange of information,
improving access by VA and non-VA clinicians nationwide to prescription
history for their patients in order to make the most appropriate and
safe treatment decisions.
______
Questions Submitted by Senator Tammy Baldwin
use of social security numbers as identifiers for veterans
Question. Mr. Secretary, I would like to see VA discontinue using
social security numbers to identify individuals in all VA information
systems. Until that is done, veterans will be at risk for identity
theft and fraud. What are your thoughts on this proposition? Is the VA
currently working to discontinue the use of social security numbers to
identify individuals? If not, why not? If the absence of a single data
backbone at VA is a barrier to achieving the discontinuation of social
security numbers, please provide a status update on the Department's
efforts to create a single data backbone and what additional resources
are needed to fully bring it online.
Answer. VA's primary uses of Social Security Numbers (SSNs) are to:
(1) locate Veterans and their dependents to ensure correct
identification associated with the delivery of benefits and services,
and (2) identify employees for employment-related record keeping. As
mistaken identity in the delivery of healthcare can result in
catastrophic and tragic outcomes, VA must ensure 100 percent accuracy
in patient identification. Until such time when a comprehensive and
equally accurate means to do this is established and implemented, the
use of SSNs remains the single best means of ensuring patient
identification. In addition, SSNs must be used if required by law or
regulation, for purposes such as:
--Background investigations;
--Security checks for validation purposes, such as computer matching
of records between government agencies; and
--Support of unique identification.
VA currently relies on the SSN to ensure that the correct records
are obtained and utilized to determine eligibility for VA benefits such
as compensation, disability, education, and rehabilitation. VA is
required by law (38 U.S.C. 5103A) to request evidence from third
parties on behalf of Veterans to support their claims. In these
requests for evidence, VA must sufficiently identify the party for whom
it is seeking information. Many entities holding Veterans' records,
including the Department of Defense (DoD), other government agencies,
and private parties, continue to utilize SSNs as a primary identifier.
As such, VA will face substantial challenges in obtaining records from
these entities on behalf of Veterans if precluded from identifying
Veterans by their SSNs. This will negatively impact Veterans by
delaying the time required to process their claims and possibly even
preventing VA from obtaining the records needed to establish Veterans'
eligibility to benefits.
VA's success rate in matching records with other Federal and non-
Federal organizations is over 85 percent when the SSN is available
compared to 20 percent when the SSN is not used. VA providers will not
have access to important outside care information and could order
redundant tests, slow decisionmaking, or make incorrect and even
harmful decisions when such data is unavailable. VA also participates
in Health Information Exchanges with DoD, Walgreens, Kaiser Permanente,
etc., and without the use of the SSN to positively identify the
Veteran, critical health information will not be available leading to
poor healthcare decisions and slower treatment.
Elimination of SSN use is not solely a function of information
technology (IT). The business processes used by the Veterans Health
Administration (VHA), Veterans Benefits Administration, and other VA
offices require a complete overhaul in how they establish absolute
identity verification inside VA and most importantly outside of VA. IT
solutions to eliminate SSN use can only occur after the integrated and
comprehensive review of the prevalence and inter-connectedness of SSN
use is complete.
SSN Reduction Effort
VA recognizes the growing threat posed by identity theft and the
impact on Veterans, dependents and employees. In 2009, VA created and
implemented the enterprise-wide Social Security Number Reduction (SSNR)
effort, in response to the Office of Management and Budget Memorandum
07-16, ``Safeguarding Against and Responding to the Breach of
Personally Identifiable Information (May 2007). The key goal of the
SSNR is to reduce or eliminate the unnecessary collection and use of
SSNs as the Department's primary identifier, while maintaining the 100
percent requirement for proper Veteran-Patient identification. For
example:
--VHA eliminated the use of SSNs on appointment letter correspondence
and the Veterans Health Identification card.
--VBA is currently evaluating the elimination of SSNs from
correspondence.
--The National Cemetery Administration has reviewed and reevaluated
all of its forms requiring SSNs.
--VA/DoD health information exchange Joint Legacy Viewer is using the
Integration Control Number (ICN), Electronic Data Interchange
Personal Identifier and other demographics for trait matching
while phasing out use of the SSN.
--VHA is utilizing a SSNR tool to collect VHA's SSN holdings data but
it has limitations due to outdated technology. The Office of
Information & Technology (OIT) is currently developing a new
SSNR tool for VA wide use which is expected to be completed by
September 2017.
Master Veteran Index System
As VA works to migrate away from the use of SSNs as the sole means
of Veteran identification, OIT is collaborating with the Veterans
Relationship Management Initiative to create the Master Veteran Index
(MVI) system and require MVI integration for every VA system. MVI
serves as the authoritative identity service within VA. MVI assigns an
ICN, a unique identifier, for each Veteran. The ICN is a sequentially
assigned, non-intelligent number that, in itself, does not provide any
protected sensitive information about the Veteran-patient. The ICN is a
means to accurately and securely track the individual and confirm their
identification. ICNs conform to the American Society for Testing and
Materials International standard for a universal healthcare identifier.
MVI now has information on over 26 million Veterans and beneficiaries
who have applied for healthcare. While additional work remains to fully
extricate SSNs from Veteran identification, including re-engineered
business processes and legacy system upgrades, programs like MVI have
made significant progress towards the goal of SSN reduction.
Conclusion
VA has made considerable progress in implementing the SSN reduction
initiative since the Office of Management and Budget's mandate in 2007.
VA continues ongoing activities to either eliminate or reduce the use
of SSN's with the goal to replace the SSN with an alternative primary
identifier. The timeframe to implement an alternate primary identifier
would be contingent upon laws, business needs, technology upgrades, and
funding.
disposition of final reports on tomah
Question. Mr. Secretary, I want to emphasize to you my belief that
the Office of Accountability Review's investigation of accusations of
widespread retaliation against whistleblowers and the culture of fear
at the Tomah VA Medical Center must be made publically available so
that veterans, VA employees and the American public are assured that
the Department has uncovered and addressed the troubling events at the
Tomah VA and related issues nationwide. The same goes for the outside
clinical review, which is being done in follow-up to the Agency's
initial review of the incidents at Tomah.
I have previously discussed this issue with other members of the VA
leadership team. I want to reiterate its importance to you as I did
with the Deputy yesterday.
When will VA make public its findings on these matters? I would
like to know the timeline of VA's plan for transparency on:
--The OAR investigation of accusations of widespread retaliation
against whistleblowers and the culture of fear at the Tomah
VAMC and
--The outside clinical review.
Answer. As of June 10, 2016, litigation is pending for one of the
subjects of the Administrative Investigation Board (AIB). Consequently,
we are currently unable to release the AIB Report.
choice program
Question. Mr. Secretary, in early February, I wrote to VA
expressing my frustration with the Choice Program. Recently, there has
been an alarming increase in the number of complaints from my
constituents about their interactions with HealthNet, the 3rd Party
Administrator for the area in which my constituents receive their
healthcare services. For example, a veteran recently shared with me
that after months of delay at VA, he was referred to the Choice Program
and scheduled for surgery at a non-VA hospital. When he called to
confirm the surgery with the hospital, it had no record of him or a
surgery being scheduled for him. A month later he received the surgery
at a different hospital. It is not uncommon for a veteran to call me
after spending many frustrating hours on the phone trying to get an
appointment scheduled.
What is the Department doing to address these problems and improve
the administration of and veteran experience with Choice?
Answer. The purpose of the Veterans Choice Program (VCP) was to
improve access to care for Veterans by allowing them to seek care in
the community if they were eligible based on certain criteria specified
in statute.
Since the implementation of VCP on November 5, 2014, a number of
amendments to the law and to VA's regulations have further expanded the
number of Veterans eligible for VCP.
VA recognizes there have been and continue to be challenges
implementing VCP. We are identifying those challenges, implementing
immediate fixes where we can, and building long-term solutions, as
needed. VA's overarching plan for community care is to consolidate
programs and simplify eligibility criteria and processes. VA is
continuing to examine how VCP interacts with other VA health programs,
including the delivery of direct care. In addition, VA is evaluating
how it will adapt to a rapidly changing healthcare environment and how
it will interact with other health providers and insurers. VA
anticipates improving the delivery of community care through
incremental improvements as outlined in the October 30, 2015, Plan to
Consolidate Community Care Programs, building on certain provisions of
the existing VCP. Implementation of these improvements requires
balancing care provided at VA facilities and in the community, and
addressing increasing healthcare costs. VA is committed to improving
Veteran's health outcomes and experience, as well as maximizing the
quality, efficiency, and sustainability of VA's health programs. While
VA can implement some of the provisions from the Plan within the
constraints of the current budget, there are certain provisions that
require legislation. The Plan identified key legislative changes needed
to consolidate the community care programs and standardize Veteran
eligibility for community care. While some legislation has been
proposed, none has been passed into law as of October 2016. Without the
legislation identified in the Plan, full consolidation cannot be
achieved.
Among other improvements, the Veterans Health Administration (VHA)
simplified the scheduling procedures and published a Deputy Under
Secretary for Health for Operations and Management memorandum on June
9, 2015, which revised procedures to require providers to write a
return-to-clinic order and schedulers to enter the date contained in
that order as the clinically indicated date (CID). This new process
keeps future appointment decisionmaking with the provider and patient,
rather than the scheduler. Associated training was provided to
schedulers at that time. Additionally, VHA uses the ``scheduling
trigger tool'' database to identify and notify facility leadership of
scheduling irregularities. Of note, a root cause of scheduling errors
is the highly manual, 30-year old scheduling software. VistA Scheduling
Enhancement (VSE) has been deployed to about 30 clinics at 5 sites and
is planned for national deployment starting in February 2017. VHA
anticipates this new scheduling software will reduce the number of
scheduling errors.
Several initiatives are planned for VHA's ``Summer of Scheduling,''
including:
--National Rollout of VSE: The rollout of VSE will be achieved
through a train the trainer or ``Super User'' approach,
developing local experts to train others. The rollout began in
May 2016 and is planned for national deployment starting in
February 2017, with ongoing associated training.
--Hire Right, Hire Fast: This project's goal is to ensure that every
facility has the right number of Medical Support Assistants
(MSA), with the right skills, who can provide the right
experience for Veterans.
--Own the Moment: VA knows that every interaction between an employee
and a Veteran matters. This project reinforces the importance
of serving with a focus on principles and values, empowering VA
employees to pursue what's right for the Veteran when
procedures serve to limit services.
--Standardized MSA Onboarding/Training: New MSA onboarding would
include a two-week training program that draws its curriculum
from scheduling rules for technical training, customer
experience training, and medical center policies. The
onboarding will provide a mentor for all new MSAs and use the
VSE ``Super Users'' model. Deployment will follow the national
rollout of VSE.
va graduate medical education (gme) expansion and staffing
Question. The 2014 VA reform law was a comprehensive response to
system-wide barriers to veterans' access to care. The law's Choice
Program is an important step to remove those barriers through non-VA
care, but it is no substitute for increasing the internal provider
capacity of the VA. The VA reform law included a provision I authored
to increase by 1,500 over 5 years the number of graduate medical
education residency positions. Can you please provide me an update on
VA's plans for ensuring that the goal of 1,500 positions is met?
I note in your testimony that in fiscal year 2015, VHA hired 41,113
employees, for a net increase of 13,940 healthcare staff. What did you
do to bring all those people on board? Can you also please briefly
discuss the Department's efforts to attract qualified physicians to VA
to care for our veterans? I know that in Tomah, VA increased the pay
available for hard-to-fill positions.
Answer. To help reach the goal of up to 1,500 new residency
positions, VA is conducting outreach and providing consultative
services, and strategic and targeted funding to assist VA facilities
and academic affiliates when addressing the complex and time intensive
process of GME residency expansion. VHA has authorized more than 372
new GME positions during the first 2 years of the 5 year program. In
addition:
--The accreditation process for each new GME residency program can
take up to 3 years and is managed by our affiliated partners
(the program sponsors).
--Once a program is accredited, incremental expansion to full
capacity takes 3 to 4 additional years.
--Since VA residency positions are rotational and complementary to
other clinical experiences, each full-time VA position is
occupied by three to four unique medical residents; thus, the
affiliated academic program sponsor must secure additional
support for the remaining portion of the residency training
outside of VA, and this support may be limited by existing
Medicare program ``caps.''
VA encourages all stakeholders, including Members of Congress
working with community stakeholders, to use this unique opportunity to
help Veterans improve access to care by identifying potential new
affiliates, while VA facilities expand their existing VA GME programs
or create new ones.
female veterans
Question. Your request includes $372 million for Minor Construction
and would provide funding for ongoing projects that renovate, expand
and improve VA facilities, while increasing access for our veterans. My
understanding is one emphasis for this funding will be projects that
enhance women's health programs. Can you please describe these
projects?
I met with several veterans groups recently who were concerned with
the lack of women healthcare professionals at VA. I support hiring more
female healthcare professionals for the growing population of women
veterans using VA primary care and mental healthcare clinics. Many
women prefer receiving healthcare services from female providers. My
understanding is that since 2003, women veterans' healthcare usage at
VA facilities has increased by more than 100 percent. What is the
Department doing to bring more female healthcare professionals to VA?
Answer. Approximately 98 percent of Women's Health providers are
women. VHA's NRP is available to provide recruitment support for
Women's Health providers (Primary Care and Obstetrics/Gynecology).
Also, there is no longer a prohibition on specifically targeting female
PCPs to consider women's health careers in VHA through recruitment
marketing/advertising.
In addition to hiring, VHA is focused on training to enhance skills
of its workforce to provide care for women Veterans. VHA has provided
training to nearly 2500 primary and emergency room providers through a
2\1/2\-day intensive review of gender specific women's healthcare that
includes training hands-on training for breast and pelvic examination.
The majority of providers trained are women. One hundred percent of
Medical Centers and 90 percent of Community Based Outpatient Centers
have Designated Women's Health Providers.
VA provides a full range of services to women Veterans, including
comprehensive primary care, gynecology care, maternity care, specialty
care, and mental health services. VA has focused on improvement of its
facilities to meet the needs of the growing numbers of women Veterans
we serve.
In order to review facilities in terms of accommodations for women
Veterans, including required privacy and security, VHA has adopted
Environment of Care (EoC) standards. These standards are now
incorporated into a tablet-based EoC survey that is conducted monthly.
The Women Veteran Program Manager is a member of the team conducting
this survey monthly. All deficiencies detected must have a remediation
plan attached, and the correction of these is tracked electronically.
The EoC data is rolled up to the facility and the Veterans Integrated
Services Network (VISN) monthly, and is the responsibility of the VISN
Capital Asset Manager.
When there is a need for remodeling or construction to enhance the
facilities, the VISN submits plans through the Strategic Capital
Investment Planning (SCIP) process. The SCIP Board reviews and
prioritizes the requests, and projects that include the needs of women
Veterans are given additional points in the prioritization. The VHA
Office of Women's Health Services subject matter expert support for
reviews related to women's needs within the SCIP process. This allows
for input on the specific facility needs for accommodations for women
Veterans.
VA is proud of high quality healthcare for women Veterans. VA is on
the forefront of information technology for women's health and is
redesigning its electronic medical record to track breast and
reproductive healthcare. Many women Veterans entering the VA system are
of child-bearing age. VA provides full gynecological care, including
maternity care, and 7 days of newborn care for all women Veterans
either on-site or through Care in the Community, paid VA. VA is
implementing a policy that requires maternity care coordinators at all
VA medical centers that stay in contact with women during their
pregnancies to support and coordinate their care.
Quality measures show that women Veterans using VA healthcare are
more likely to receive breast cancer and cervical cancer screening than
women in private sector healthcare. VA also tracks quality of care by
gender and, unlike other healthcare systems, has been able to reduce
and eliminate gender disparities in important aspects of health
screening, prevention, and chronic disease management. Some of our
national accomplishments include the following:
--VA completed two mobile applications for Women's Health, Caring for
Women Veterans and Pre-Conception Care, that are available for
providers in the community to download when caring for women
Veteran patients.
--Maternity Care Coordination Telephone Care Program provided care
coordination services to over 2000 unique pregnant Veterans,
over 20 percent of whom resided in rural zip codes.
--Breast Care Registry to enhance care coordination of breast cancer
screening and treatment for women Veterans.
--Women Veterans Call Center (WVCC), created to contact women
Veterans to inform them about eligible services. As of February
2016, WVCC received 30,399 incoming calls and made 522,038
outbound calls, successfully reaching 278,238 women Veterans.
--An enhanced provision of care to women Veterans by focusing on the
goal of developing Designated Women's Health Providers (DWHP)
at every site where women access VA. One hundred percent of VA
medical centers and 90 percent of VA community based outpatient
clinics have DWHPs
--The training of nearly 2,500 providers in women's health and
continued training of additional providers to ensure that every
woman Veteran has the opportunity to receive her primary care
from a DWHP.
--Pursuant to Veterans Access, Choice, and Accountability Act,
expanding the eligibility for Veterans in need of mental
healthcare due to military sexual trauma (MST) experiences of
sexual assault or sexual harassment that occurred during their
military service. All MST-related healthcare is provided
without copayment requirements.
VA is enhancing facilities, training healthcare staff, and
improving access to services to meet the current and future healthcare
needs of women Veterans.
exempting copayment requirements for naloxone rescue kits and education
Question. Please explain why the Department believes it is so
critical to veteran patient safety to eliminate copayments for naloxone
kits and related education.
Answer. Patients who are told by their medical providers that they
are at high-risk for drug overdose often still do not believe that
overdose will happen to them. During efforts to implement the Overdose
Education and Naloxone Kit program nationally in VA, numerous
healthcare providers have reported that patients who are considered at
high-risk for drug overdose have refused the naloxone kits because they
do not believe they will need it and therefore, they are unwilling to
pay the co-pay for the medication. We greatly appreciate Congress'
enactment of provisions eliminating copayment requirements for
medication and education and counseling for opioid antagonists in
section 915 of the Comprehensive Addiction and Recovery Act of 2016
(Public Law 114-198), and we are working to implement these changes as
quickly as possible.
SUBCOMMITTEE RECESS
Senator Kirk. The next meeting of the subcommittee will be
on Thursday, April 7.
We will stand adjourned. Thank you, Mr. Secretary.
[Whereupon, at 12:20 p.m., Thursday, March 10, the
subcommittee was recessed, to reconvene Thursday, April 7, at a
time subject to the call of the Chair.]
MILITARY CONSTRUCTION, VETERANS AFFAIRS, AND RELATED AGENCIES
APPROPRIATIONS FOR FISCAL YEAR 2017
----------
THURSDAY, APRIL 7, 2016
U.S. Senate,
Subcommittee of the Committee on Appropriations,
Washington, DC.
The subcommittee met at 10:34 a.m., in room SD-124, Dirksen
Senate Office Building, Hon. Mark Kirk (chairman) presiding.
Present: Senators Kirk, Murkowski, Hoeven, Collins,
Boozman, Cassidy, Tester, Udall, Schatz, Baldwin, and Murphy.
DEPARTMENT OF DEFENSE
Office of the Secretary of Defense
STATEMENT OF PETER J. POTOCHNEY, PERFORMING THE DUTIES
OF ASSISTANT SECRETARY OF DEFENSE, ENERGY,
INSTALLATIONS AND ENVIRONMENT
OPENING STATEMENT OF SENATOR MARK KIRK
Senator Kirk. The subcommittee will come to order. This is
the third hearing for fiscal year 2017.
I want to welcome my friend Senator Jon Tester, who we hope
will be with us at some point later on. He is on the way, I
think.
I want to welcome our four witnesses from the Office of
Secretary Mr. Pete Potochney; from the Army, Assistant
Secretary Katherine Hammack; from the Navy, Principal Deputy
Assistant Secretary Iselin; and from the Air Force, we have
Assistant Secretary Miranda Ballentine.
We will proceed in this hearing with the early bird rule,
alternating sides. I ask members to defer from any opening
statements, and we will go to 5-minute question rounds.
I will just hold off here, waiting for Mr. Tester to come,
then we will formally begin. We will just suspend for Jon
Tester, the senior Senator for the Big Sandy metroplex.
Let's go to our statements. In this hearing, I want to hear
how the funding that is being requested directly supports the
Nation's men and women in uniform and how our military strategy
is supported by the request.
Military construction is more than just bricks and mortar.
It is also something that is a vital part of the strategic
goals of the United States.
I want to hear more about how the request strengthens our
ballistic missile defenses with key allies like Poland. I want
to hear how this request supports the missile defense in
Redzikowo, Poland, and to hear how this request improves the
quality of life for our men and women who choose to wear the
uniform, and specifically the quality and safety of the places
where they live.
I want to recognize our witnesses for their opening
remarks. We will start you guys off.
Pete, why don't you kick it off?
SUMMARY STATEMENT OF PETER J. POTOCHNEY
Mr. Potochney. Thank you, sir. I am Pete Potochney,
currently the Deputy Assistant Secretary for basing and also
the Acting right now, performing the duties of Assistant
Secretary for Energy, Installations, and Environment, and have
been acting in that capacity since December and will continue
to do so until we have a nominee and confirmation.
I am pleased, proud, and honored to be here. I appreciate
this opportunity to talk to you, and I also will appreciate my
remarks being in the record.
Senator Kirk. Without objection.
Mr. Potochney. I'll be very brief. The people at this
table, in my view, and I know for myself, are doing the best we
can in a tough budget environment. Mr. Chairman, you talked
about things like quality of life, and how our construction is
supporting our readiness and our capabilities and the men and
women who serve us so well. That is what we are about.
We do the best we can to ensure that those dollars are
spent wisely, and we do the best we can to compete for those
resources within a tough budget environment. That is what we
do. We fight pretty strongly for those resources.
In that regard, in a tough budget environment, we are
asking once again for base realignment and closure (BRAC). We
need it. It allows us to avoid wasting resources on unnecessary
facilities and channeling those resources into our readiness
and quality of life, and they are directly linked.
So we ask that you entertain that, because we do feel it is
important.
And I will conclude my remarks with that. Thank you.
[The statement follows:]
Prepared Statement of Peter J. Potochney
Introduction
Chairman Kirk, Ranking Member Tester and distinguished members of
the subcommittee: Thank you for the opportunity to present the
President's fiscal year 2017 budget request for the Department of
Defense programs supporting energy, installations, and the environment.
In my testimony, I will focus first on the budget request. As you
will note, the administration's budget includes $7.4 billion for
Military Construction (including family housing), and $10.2 billion for
Facility Sustainment and Recapitalization. These are both decreases
from last year, as the Bipartisan Budget Act of 2015 caps overall
defense spending. Although this request allows a reduction in
facilities risk due to a slight increase in Sustainment funding by the
services, the Department is still accepting risk in facilities. As this
subcommittee well knows, facilities degrade more slowly than readiness,
and in a constrained budget environment, it is responsible to take risk
in facilities first.
My testimony will also address the environmental budget. This
budget has been relatively stable, and we continue to show progress in
both our compliance program, where we've seen a decrease in
environmental violations, and in cleanup, where 84 percent of our
39,000 sites have reached Response Complete. We remain on track to meet
our goals of 90 percent Response Complete in 2018, and 95 percent in
2021.
As you know, Operational Energy Plans and Programs merged with
Installations and Environment office in 2015 to form the Office of
Assistant Secretary of Defense for Energy, Installations and
Environment (EI&E). EI&E now oversees all energy that is required for
training, moving and sustaining military forces and weapons platforms
for military operations, as well as energy used on military
installations. While the budget request for Military Construction and
Environmental Remediation programs includes specific line items, the
Department's programs for Operational Energy and Installation Energy
are subsumed into other accounts. With that in mind, I will summarize
the newly released 2016 Operational Energy Strategy and address the
budgets for the Department's operational and installation energy
portfolio.
In addition to budget, I will also highlight a handful of top
priority issues--namely, the administration's request for BRAC
authority, European consolidation efforts, European Reassurance
Initiative, the status of the movement of Marines from Okinawa to Guam,
an overview of our energy programs, and climate change.
Fiscal Year 2017 Budget Request--Military Construction and Family
Housing
The President's fiscal year 2017 budget requests $7.4 billion for
the Military Construction (MILCON) Appropriation--a decrease of
approximately $1.0 billion from the fiscal year 2016 budget request
(see Table 1 below). This decrease is directly attributable to the
resourcing constraints established by the Bipartisan Budget Agreement
and the Department's need to fund higher priority readiness and
weapon's modernization program. The request does recognize the
Department's need to invest in facilities that address critical mission
requirements and life, health, and safety concerns, while acknowledging
the constrained fiscal environment. In addition to new construction
needed to bed-down forces returning from overseas bases, this funding
will be used to restore and modernize enduring facilities, acquire new
facilities where needed, and eliminate those that are excess or
obsolete. The fiscal year 2017 MILCON request includes projects that
directly support operations and training, maintenance and production,
and projects to take care of our people and their families, such as
medical treatment facilities, unaccompanied personnel housing, and
schools.
As shown by the decrease in this year's budget request, the DOD
Components continue to take risk in the MILCON program in order to
lessen risk in other operational and training budgets. While the
Department's fiscal year 2017 budget request funds critical projects
that sustain our warfighting and readiness postures, taking continued
risk across our facilities inventory will degrade our facilities and
result in the need for significant investment for facility repair and
replacement in the future. Our limited MILCON budget for fiscal year
2017 leaves limited room for projects that would improve aging
workplaces, and therefore, could adversely impact routine operations
and the quality of life for our personnel.
TABLE 1. MILCON APPROPRIATION REQUEST, FISCAL YEAR 2016 VERSUS FISCAL YEAR 2017
----------------------------------------------------------------------------------------------------------------
Change From Fiscal Year
Fiscal Year Fiscal Year 2016
Account Category 2016 2017 ---------------------------
Request ($ Request ($ Funding ($
Millions) Millions) Millions) Percent
----------------------------------------------------------------------------------------------------------------
Military Construction..................................... 6,653 5,741 (912) (14)
Base Realignment and Closure.............................. 251 205 (46) (18)
Family Housing............................................ 1,413 1,320 (93) (7)
Chemical Demilitarization................................. 0 0 0 0
NATO Security Investment Program.......................... 120 178 58 48
-----------------------------------------------------
TOTAL............................................... 8,437 7,444 (993) (12)
----------------------------------------------------------------------------------------------------------------
military construction
The fiscal year 2017 military construction request of $6.1 billion
addresses routine requirements for construction at enduring
installations stateside and overseas, and for specific programs such as
Base Realignment and Closure and the NATO Security Investment Program.
This is a 13 percent decrease from our fiscal year 2016 request, and
this level of funding remains significantly less than historic trends
prior to the Budget Control Act. In addition, we are targeting MILCON
funds to three key areas.
First and foremost, our MILCON request supports the Department's
operational missions. MILCON is key to supporting forward deployed
missions as well as implementing initiatives such as the Asia-Pacific
rebalance, European Infrastructure Consolidation, European Reassurance
Initiative, and cyber mission effectiveness. Our fiscal year 2017
budget request includes $473 million for 13 F-35A/B/C maintenance,
production, training, and support projects to accommodate initial F-35
deliveries; $194 million to support 8 fuel infrastructure projects;
$62.2 million for a power upgrades utility project in support of the
U.S. Marines relocation to Guam; $260 million for recapitalization of
National Security Agency facilities; and $53.1 million for the third
phase of a Joint Intelligence Analysis Complex Consolidation at Royal
Air Force Croughton, United Kingdom. The budget request also includes
$470 million to address new capabilities/mission, force structure
growth, and antiquated infrastructure for Special Operations Forces;
$176 million for 3 Missile Defense Agency projects, including $156
million for Phase 1 of the Long Range Discrimination Radar System
Complex in Alaska; a $76 million investment to recapitalize facilities
at three Naval Shipyards; and $124 million for 4 unmanned aerial
vehicle operational facilities.
Second, our fiscal year 2017 military construction budget request
continues the Department's 10 year plan (which started in fiscal year
2011) to replace and recapitalize more than half of the DODEA schools.
Funding in fiscal year 2017 includes $246 million to address four
schools in poor condition at Dover, Delaware; Kaiserslautern, Germany;
Kadena AB, Japan; and RAF Croughton, United Kingdom.
Third, the fiscal year 2017 budget request includes $304 million
for medical facility recapitalization. This includes $50 million for
the first increment of a $510 million project for the Walter Reed
Medical Center Addition/Alteration; $58.1 million for increment six (of
a $982 million seven increment project) for the Medical Center
Replacement at Rhine Ordnance Barracks in Germany; and $195.9 million
for five other smaller medical/dental facilities. All the projects are
crucial for our continued delivery of quality healthcare that our
service members and their families deserve whether stationed stateside
or during overseas deployments.
overseas contingency operations
The fiscal year 2017 Overseas Contingency Operations budget request
includes $47.9 million for projects supporting the mission in East
Africa (Djibouti). The request also includes $113.6 million in European
Reassurance Initiative military construction funding for military
construction activities for the Active components of all Military
Services, and Defense-Wide Activities supporting military operations in
Europe in direct support of NATO, Operation Freedom's Sentinel, and
Operation Inherent Resolve. Funds provided would bolster security of
U.S. NATO Allies and partner states in Europe and deter aggressive
actors in the region by enhancing prepositioning and weapons storage
capabilities, improving airfield and support infrastructure, providing
5th generation warfighting capability, and building partnership
capacity.
family and unaccompanied housing
A fundamental priority of the Department is to support military
personnel and their families to improve their quality of life by
ensuring access to suitable, affordable housing. Service members are
engaged in the front lines of protecting our national security and they
deserve the best possible living and working conditions. Sustaining the
quality of life of our people is crucial to recruitment, retention,
readiness and morale.
Our fiscal year 2017 budget request includes $1.3 billion to fund
construction, operation, and maintenance of Government-owned and leased
family housing worldwide as well as to provide housing referral
services to assist military members in renting or buying private sector
housing, and oversight of privatized family housing (see Table 2
below). Included in this request is $356 million for construction and
improvements; $232 million for operations (including housing referral
services); $229 million for maintenance; $154 million for utilities;
and $349 million for leasing and privatized housing oversight.
This funding request supports over 38,000 Government-owned family
housing units, almost all of which are on enduring bases in foreign
countries now that the Department has privatized the vast majority of
our family housing in the United States (over 206,000 units). The
Department is also leasing more than 9,000 family housing units where
Government-owned or privatized housing is not feasible. Our request
also includes $3.3 million to support administration of the Military
Housing Privatization Initiative (MHPI) Program as prescribed by the
Federal Credit Reform Act of 1990, to ensure the project owners
continue to fund future capital repairs and replacements as necessary
to provide quality housing for military families and to ensure that
these projects remain viable for their 40-50 year lifespan.
In fiscal year 2015, the Department notified Congress of DOD's
intent to transfer $96 million of Navy family housing construction
funds into the Department's Family Housing Improvement Fund (FHIF) to
execute Hawaii Phase 6 to support Marine Corps housing requirements in
Hawaii. Execution of Hawaii Phase 6 brings the Department's total
privatized family housing inventory to nearly 202,000 homes.
TABLE 2. FAMILY HOUSING BUDGET REQUEST, FISCAL YEAR 2016 VERSUS FISCAL YEAR 2017
----------------------------------------------------------------------------------------------------------------
Change From Fiscal Year
Fiscal Year Fiscal Year 2016
Account Category 2016 2017 ---------------------------
Request ($ Request ($ Funding ($
Millions) Millions) Millions) Percent
----------------------------------------------------------------------------------------------------------------
Family Housing Construction/Improvements.................. 277 356 79 29
Family Housing Operations & Maintenance................... 1,136 961 (175) (15)
Family Housing Improvement Fund \1\....................... 0 3 3 100
-----------------------------------------------------
TOTAL............................................... 1,413 1,320 93 (7)
----------------------------------------------------------------------------------------------------------------
\1\ We made no fiscal year 2016 request for funds to oversee privatized housing because we had sufficient fiscal
year 2015 cost savings to cover our fiscal year 2016 expenses.
The Department also continues to encourage the modernization of
Unaccompanied Personnel Housing (UPH) to improve privacy and provide
greater amenities. In recent years, we have heavily invested in UPH to
support initiatives such as BRAC, global restationing, force structure
modernization, and the Navy's Homeport Ashore initiative. However, this
constrained budget request only includes five UPH projects totaling
$161 million, all of which are for transient personnel or trainees such
as a $67 million Recruit Dormitory at Joint Base San Antonio, Texas.
facilities sustainment and recapitalization
In addition to new construction, the Department invests significant
funds in maintenance and repair of our existing facilities. Sustainment
represents the Department's single most important investment in the
condition of its facilities. It includes regularly scheduled
maintenance and repair or replacement of facility components--the
periodic, predictable investments that should be made across the
service life of a facility to slow its deterioration, optimize the
Department's investment, and save resources over the long term. Proper
sustainment slows deterioration, maintains safety, preserves
performance over the life of a facility, and helps improve the
productivity and quality of life of our personnel.
TABLE 3. SUSTAINMENT AND RECAPITALIZATION BUDGET REQUEST, FISCAL YEAR 2016 VERSUS FISCAL YEAR 2017
----------------------------------------------------------------------------------------------------------------
Change From Fiscal Year
Fiscal Year Fiscal Year 2016
Account Category 2016 2017 ---------------------------
Request ($ Request ($ Funding ($
Millions) Millions) Millions) Percent
----------------------------------------------------------------------------------------------------------------
Sustainment (O&M)......................................... 8,022 7,450 (572) (7)
Recapitalization (O&M).................................... 2,563 2,088 (475) (19)
-----------------------------------------------------
TOTAL............................................... 10,585 9,538 (1,047) (10)
----------------------------------------------------------------------------------------------------------------
The accounts that fund these activities have taken significant cuts
in recent years. For fiscal year 2017, the Department's budget request
includes $7.4 billion for sustainment and $2.1 billion for
recapitalization (see Table 3 above) in Operations & Maintenance
funding only. The combined level of sustainment and recapitalization
funding ($9.5 billion) is a 10 percent decrease from the fiscal year
2016 President's budget (PB) request ($10.6 billion), and reflects an
acceptance of significant risk in DOD facilities. In fact, the request
supports average DOD-wide sustainment funding level that equates to 74
percent of the FSM requirement as compared to the Department's goal to
fund sustainment at 90 percent of modeled requirements.
Recent and ongoing budget constraints have limited investment in
facilities sustainment and recapitalization to the point that 11.7
percent of the Department's facility inventory is in ``poor'' condition
(Facility Condition Index (FCI) between 60 and 79 percent) and another
14.8 percent is in ``failing'' condition (FCI below 60 percent) based
on recent facility condition assessment data. Compared to last year
(see Table 4), the Department is seeing more poor facilities moving
into failing conditions. Until the out-year sequestration challenges
are overcome, the Department will continue to take risk in funding to
sustain and recapitalize existing facilities. This will ultimately
result in DOD facing larger bills in the out-years to restore or
replace facilities that deteriorate prematurely.
TABLE 4.--COMPARISON OF FISCAL YEAR 2014 AND FISCAL YEAR 2015 FACILITY CONDITION INDICES
----------------------------------------------------------------------------------------------------------------
End of Fiscal Year 2014 FCI (%) End of Fiscal Year 2015 FCI (%)
-------------------------------------------------------------------
Poor (60-79%) Failing (<60%) Poor (60-79%) Failing (<60%)
----------------------------------------------------------------------------------------------------------------
Army........................................ 31.3 10.2 12.8 26.1
Navy........................................ 17.4 6.4 15.8 6.4
Air Force................................... 2.6 4.1 5.7 3.9
Washington Headquarters Service............. 2.2 4.7 2.1 5.8
-------------------------------------------------------------------
TOTAL................................. 19.7 7.4 11.7 14.8
----------------------------------------------------------------------------------------------------------------
Fiscal Year 2017 Budget Request--Environmental Programs
The Department has long made it a priority to protect the
environment on our installations, not only to preserve irreplaceable
resources for future generations, but to ensure that we have the land,
water and airspace we need to sustain military readiness. To achieve
this objective, the Department has made a commitment to continuous
improvement, pursuit of greater efficiency and adoption of new
technology. In the President's fiscal year 2017 budget, we are
requesting $3.4 billion, a slight decrease from fiscal year 2016, to
continue the legacy of excellence in our environmental programs.
The table below outlines the entirety of the DOD's environmental
program, but I would like to highlight a few key elements where we are
demonstrating significant progress--specifically, our environmental
restoration program, our efforts to leverage technology to reduce the
cost of cleanup, and the Readiness and Environmental Protection
Integration (REPI) program.
TABLE 5: ENVIRONMENTAL PROGRAM BUDGET REQUEST, FISCAL YEAR 2017 VERSUS FISCAL YEAR 2016
----------------------------------------------------------------------------------------------------------------
Change From Fiscal Year
Fiscal Year Fiscal Year 2016
Account Category 2016 2017 ---------------------------
Request ($ Request ($ Funding ($
Millions) Millions) Millions) Percent
----------------------------------------------------------------------------------------------------------------
Environmental Restoration................................. 1,107 1,030 -77 -7
Environmental Compliance.................................. 1,389 1,493 103 7
Environmental Conservation................................ 389 420 31 8
Pollution Prevention...................................... 101 84 -17 -17
Environmental Technology.................................. 200 186 -14 -7
BRAC Environmental........................................ 217 181 -36 -17
-----------------------------------------------------
TOTAL............................................... 3,405 3,395 -10 -0.3
----------------------------------------------------------------------------------------------------------------
environmental restoration
We are requesting $1.2 billion to continue cleanup efforts at
remaining Installation Restoration Program (IRP--focused on cleanup of
hazardous substances, pollutants, and contaminants) and Military
Munitions Response Program (MMRP--focused on the removal of unexploded
ordnance and discarded munitions) sites. This includes $1.0 billion for
``Environmental Restoration,'' which encompasses active installations
and Formerly Used Defense Sites (FUDS) locations and $181 million for
``BRAC Environmental.'' The amount of BRAC Environmental funds
requested will be augmented by $108 million of land sale revenue and
prior year, unobligated funds, bringing the total amount of BRAC
Environmental funding planned for obligation in fiscal year 2017 to
$289 million. These investments help to ensure DOD continues to make
property at BRAC locations safe and environmentally suitable for
transfer. We remain engaged with the Military Departments to ensure
they are executing plans to spend remaining unobligated balances in the
BRAC account.
TABLE 6: PROGRESS TOWARD CLEANUP GOALS
----------------------------------------------------------------------------------------------------------------
Goal: Achieve Response Complete at 90% and 95% of Active and BRAC IRP and MMRP sites, and FUDS IRP sites, by
fiscal year 2018 and fiscal year 2021, respectively
-----------------------------------------------------------------------------------------------------------------
Projected Status at the Projected Status at the
Status as of the end of end of fiscal year 2018 end of fiscal year 2021
fiscal year 2015 (%) (%) (%)
----------------------------------------------------------------------------------------------------------------
Army.............................. 90 94 97
Navy.............................. 80 86 92
Air Force......................... 80 89 94
DLA............................... 86 97 97
FUDS.............................. 80 89 94
-----------------------------------------------------------------------------
Total....................... 84 91 95
----------------------------------------------------------------------------------------------------------------
We are cleaning up sites on our active installations in parallel
with those on bases closed in previous BRAC rounds--cleanup is not
something that DOD pursues only when a base is closed. In fact, the
significant progress we have made over the last 20 years cleaning up
contaminated sites on active DOD installations is expected to reduce
the residual environmental liability in the disposition of our property
made excess through the BRAC process or other efforts.
By the end of 2015, the Department, in cooperation with State
agencies and the Environmental Protection Agency, completed cleanup
activities at 84 percent of Active and BRAC IRP and MMRP sites, and
FUDS IRP sites, and is now monitoring the results. During fiscal year
2015 alone, the Department completed cleanup at over 870 sites. Of the
roughly 39,500 restoration sites, almost 31,500 are now in monitoring
status or cleanup completed. We are currently on track to meet our
program goals--anticipating complete cleanup at 95 percent of Active
and BRAC IRP and MMRP sites, and FUDS IRP sites, by the end of 2021.
Our focus remains on continuous improvement in the restoration
program: minimizing overhead; adopting new technologies to reduce cost
and accelerate cleanup; refining and standardizing our cost estimating;
and improving our relationships with State regulators through increased
dialogue. All of these initiatives help ensure that we make the best
use of our available resources to complete cleanup.
environmental technology
A key part of DOD's approach to meeting its environmental
obligations and improving its performance is its pursuit of advances in
science and technology. The Department has a long record of success
when it comes to developing innovative environmental technologies and
getting them transferred out of the laboratory and into actual use on
our remediation sites, installations, ranges, depots and other
industrial facilities. These same technologies are also now widely used
at non-Defense sites helping the Nation as a whole.
While the fiscal year 2017 budget request for Environmental
Technology overall is $191 million, our core efforts are conducted and
coordinated through two key programs--the Strategic Environmental
Research and Development Program (SERDP--focused on basic research) and
the Environmental Security Technology Certification Program (ESTCP--
which validates more mature technologies to transition them to
widespread use). The fiscal year 2017 budget request includes $65
million for SERDP and $32 million for ESTCP for environmental
technology demonstrations, with an additional $20 million requested
specifically for energy technology demonstrations.
These programs have already achieved demonstrable results and have
the potential to reduce the environmental liability and costs of the
Department--developing new ways of treating groundwater contamination,
reducing the life-cycle costs of multiple weapons systems, and
improving natural resource management.
As an example, this past year SERDP-sponsored project to conduct
basic research that is will develop an environmentally benign Chemical
Agent Resistant Coating (CARC), which is critical technology for the
protection of military assets. Current CARC coatings contribute
approximately 2.3 million pounds of volatile organize compounds (VOCs)
and hazardous air pollutants (HAPs) to the environment each year. The
new novel powder CARC is absent of solvent, emits nearly zero VOCs, can
be recycled, and is compatible with existing CARC systems. In addition,
testing to date proves that the exterior durability of this coating is
superior to any liquid CARC system, supporting DOD's initiative for
corrosion prevention and mitigation. Coating products are currently in
transition to Original Equipment Manufacturers, Depots, and the Defense
Logistics Agency (DLA).
Looking ahead, our environmental technology investments are focused
on the Department's evolving requirements. In the area of Environmental
Restoration, we are launching a new 3-year initiative to support
sustainable range management by researching the environmental impacts
of new munitions compounds and we will continue our investments in
technologies to address the challenges of contaminated groundwater
sites where no good technical solutions are currently available. We are
working to understand the behavior of contaminants in fractured bedrock
and large dilute plumes, which represent a large fraction of these
sites, and to develop treatment and management strategies. We will
continue our efforts to develop the science and tools needed to meet
the Department's obligations to assess and adapt to climate change.
Finally, to transition the important work of improving the
sustainability of our industrial operations and reducing life-cycle
costs by eliminating toxic and hazardous materials from our production
and maintenance processes we are initiating a program to demonstrate
that our most hazardous chemicals can be eliminated from a maintenance
production line.
environmental conservation and compatible development
To maintain access to the land, water and airspace needed to
support our mission needs, the Department continues to successfully
manage the natural resources entrusted to us--including protecting the
many threatened and endangered species found on our lands. DOD manages
approximately 25 million acres containing many high-quality and unique
habitats that provide food and shelter for nearly 520 species-at-risk
and over 400 that are federally listed as threatened or endangered
species. That is 9 times more species per acre than the Bureau of Land
Management, 6 times more per acre than the United States Fish and
Wildlife Service (USFWS), 4.5 times more per acre than the Forest
Service, and 3.5 times more per acre than the National Park Service. A
surprising number of rare species are found only on military lands--
including more than 15 listed species and at least 75 species-at-risk.
The fiscal year 2017 budget request for Conservation is $420
million. The Department invests these funds to manage its imperiled
species as well as all of its natural resources in an effort to sustain
the high quality lands our service personnel need for testing, training
and operational activities, and to maximize the flexibility our
servicemen and women need to effectively use those lands. Species
endangerment and habitat degradation can and does have direct mission-
restriction impacts. That is one reason we work hard to prevent species
from becoming listed and, if they do become listed, to manage these
species and their habitat in ways that sustain the resource and enable
our ability to test and train. All of our plans now adequately address
these species, and we have successfully and consistently avoided
critical habitat designations because our plans adequately address
management concerns for species that exist on our lands. Getting ahead
of any future listings has been a prime, natural resource objective for
the last several years and will remain so in the future.
Readiness and Environmental Protection Integration (REPI) Program
To help ensure DOD sustains its national defense mission and
protects species under duress, the Department has developed a strategy
that supports conservation beyond installation boundaries. Under this
strategy DOD engages with other governmental and non-governmental
partners, as well as private landowners, to develop initiatives and
agreements for protecting species for the purposes of precluding or
mitigating regulatory restrictions on training, testing, and operations
on DOD lands. Expanding the scale and options for protecting species on
non-DOD land benefits conservation objectives while helping sustain
access to, and operational use, of DOD live training and test domains.
This strategic focus is a key element of the Readiness and
Environmental Protection Integration (REPI) Program. Under REPI, the
Department partners with conservation organizations and State and local
governments to preserve buffer land and sensitive habitat near
installations and ranges. Preserving these areas allows the Department
to avoid more costly alternatives such as workarounds, restricted or
unrealistic training approaches, or investments to replace existing
test and training capability. Simultaneously, these efforts ease the
on-installation species management burden and reduce the possibility of
restricted activities, ultimately providing more flexibility for
commanders to execute their missions.
Included within the $420 million for Conservation, $60 million is
directed to the REPI Program. The REPI Program is a cost-effective tool
to protect the Nation's existing training, testing, and operational
capabilities at a time of decreasing resources. In the last 13 years,
REPI partnerships have protected more than 437,000 acres of land around
86 installations in 29 States. In addition to the tangible benefits to
training, testing, and operations, these efforts have resulted in
significant contributions to biodiversity and recovery actions
supporting threatened, endangered and candidate species.
The REPI Program supports the warfighter and protects the taxpayer
because it multiplies the Department's investments through unique cost-
sharing agreements. Even in these difficult economic times, REPI is
able to directly leverage the Department's investments at least one-to-
one with those of our partners, effectively securing critical buffers
around our installations for half-price.
In addition, DOD, along with the Departments of the Interior and
Agriculture, continues to advance the Sentinel Landscapes Partnership
to protect large landscapes where conservation, working lands, and
national defense interests converge--places defined as Sentinel
Landscapes. Established in 2013, the Sentinel Landscapes Partnership
further strengthens interagency coordination and provides taxpayers
with the greatest leverage of their funds by aligning Federal programs
to advance the mutually-beneficial goals of each agency.
Thus far, three Sentinel Landscapes have been identified around
Joint Base Lewis-McChord, Washington; Fort Huachuca, Arizona; and Naval
Air Station (NAS) Patuxent River and the Atlantic Test Ranges,
Maryland. The pilot Sentinel Landscape project at JBLM influenced the
USFWS decision to avoid listing a butterfly species in Washington,
Oregon, and California. The USFWS cited the ``high level of protection
against further losses of habitat or populations'' from investments
made by Joint Base Lewis-McChord's REPI partnership, actions that allow
significant maneuver areas to remain available and unconstrained for
active and intense military use at JBLM. At Fort Huachuca, NAS Patuxent
River and the Atlantic Test Ranges, DOD is working with USFWS, the
Natural Resources Conservation Service, the U.S. Forest Service, and a
variety of State and private conservation organizations to protect
important swaths of special use airspace used for aircraft testing and
training, while also benefiting ecologically sensitive watersheds and
the installations, wildlife, and working lands dependent on those
resources.
Fiscal Year 2017 Budget Request--Energy Programs
Unlike the Department's Military Construction and Environmental
Remediation programs, where the budget request includes specific line
items, our energy programs are subsumed into other accounts. The
following sections describe the Energy portion of the budget request.
Further discussion of energy follows in the highlighted issues section.
operational energy
In fiscal year 2017, the Department's budget request includes an
estimated $9.8 billion for 93.3 million barrels of fuel. In order to
increase warfighting capability and reduce operational risk, the
Department's fiscal year 2017 budget request also includes $2.5 billion
for adaptations and improvements in our use of operational energy.
Operational energy is the energy used to power aircraft, ships, combat
vehicles, and mobile power generation at contingency bases. While there
is no explicit budget request for Operational Energy, these investments
across multiple accounts and appropriations are intended specifically
to improve military capability.
Within this overall request, the Department is requesting $37.3M in
RDT&E funding to support the Operational Energy Capabilities
Improvement Fund (OECIF). OECIF provides funding to DOD research
programs that improve operational energy performance organized around a
specific annual theme or focus area, as well as sustain funding to
those programs already underway. The fiscal year 2017 President's
budget will provide funding for new programs, as well as support those
programs established in fiscal year 2014-fiscal year 2016.
Finally, the Department is requesting $5.4 million in fiscal year
2017 to fund the operations of OASD(EI&E) and oversee operational
energy activities. Each year, EI&E certifies that the President's
budget is adequate for carrying out the Department's Operational Energy
Strategy. The full certification report, which will be provided to
Congress in the near future, will provide a more comprehensive
assessment of the alignment of operational energy initiatives with the
goals of the recently released 2016 Operational Energy Strategy.
2016 Operational Energy Strategy
Reflecting lessons learned, strategic guidance, and the evolving
operational environment, the 2016 Operational Energy Strategy is
designed to improve our ability to deliver the operational energy
needed to deploy and sustain forces in an operational environment
characterized by peer competitors, asymmetric insurgents, and
unforgiving geography. The strategy identifies the following three
objectives:
--Increase Future Warfighting Capability. Foremost, the strategy
focuses on increasing warfighter capability through energy-
informed force development. In addition to energy Key
Performance Perimeters (eKPP) informed by energy supportability
analyses that improve the combat effectiveness and
supportability of major acquisition programs, the Department
will continue to invest in energy innovation that improves the
long-term capability of the Department, such as increasing the
unrefueled range or endurance of platforms. With this knowledge
of inherent energy constraints and risks, the Military
Departments will be better able to make energy-informed
decisions related to force development and future capabilities.
--Identify and Reduce Logistics and Operational Risks. To effectively
reduce logistics risks, the Department will address energy
risks in near-term operation plans as well as more exploratory,
longer-term concepts of operation. Initiatives that fall into
this category seek to mitigate warfighting gaps found in
Integrated Priority Lists, OPLANs, and wargames. The
Department's focus on risk will ensure future forces are better
aligned to mitigate potential threats to operations.
--Enhance Mission Effectiveness of the Current Force. Finally, the
strategy will improve the effectiveness of U.S. Forces
operating around the globe today. To do so, the Department will
emphasize improved energy use in operations and training, and
enhanced education of operators, logisticians, and system
developers. These initiatives may include material and non-
material enhancements to day to day operations, as well as
adaptations in training, exercises, and professional military
education.
In coordination with the Combatant Commands, Military Departments,
Joint Staff, and Defense Agencies, my office is overseeing the
execution of 15 targets arrayed across the three objectives. For
instance, we are supporting Joint Staff oversight of the energy KPP,
facilitating operational energy advisors at the Combatant Commands, and
assessing the role of operational energy in war games and operation
plan reviews. In addition to the Defense Operational Energy Board, we
will use existing requirements, acquisition, programming, and budgeting
processes to review Department progress against these targets.
installation energy
As with Operational Energy, there is no explicit request in the
overall budget for Facilities Energy--utilities expenditures are
included in the Base Operations O&M request. Facilities Energy remains
our single largest base operating cost and in fiscal year 2015, we
spent $3.9 billion to heat, cool, and provide electricity to our
buildings. To reduce this cost the Department is pursuing energy
efficiencies through building improvements, new construction, and third
party investments.
The Department's fiscal year 2017 budget request includes
approximately $618 million for investments in conservation and energy
efficiency, most of which will be directed to existing buildings. The
majority ($468 million) is in the Military Components' operations and
maintenance accounts, to be used for sustainment and recapitalization
projects. Such projects typically involve retrofits to incorporate
improved lighting, high-efficiency HVAC systems, double-pane windows,
energy management control systems, and new roofs. The remainder ($150
million) is for the Energy Conservation Investment Program (ECIP), a
Military Construction account used to implement energy efficiency,
water conservation, and renewable energy projects. Each individual ECIP
project has a positive payback (i.e. Savings to Investment Ratio (SIR)
> 1.0) and the overall program has a combined SIR greater than 2.0.
This means for every dollar we invest in ECIP, we generate more than
two dollars in savings.
The Military Component investments include activities that would be
considered regular maintenance and budgeted within the O&M accounts for
Facilities Sustainment, Restoration, and Maintenance activities. The
risk that has been accepted in those accounts will not only result in
fewer energy projects, but failing to perform proper maintenance on our
buildings will without question have a negative impact on our energy
usage. In plain terms, upgrades to air conditioning systems will not
reduce energy usage as projected if the roof is leaking or the windows
are broken.
In addition to retrofitting existing buildings, we continue to
drive efficiency in our new construction. Our new buildings must be
constructed using the high-performance sustainable buildings standards
issued by my office 2 years ago which include greater energy efficiency
requirements.
Additionally, the Department is taking advantage of third-party
financing through Energy Savings Performance Contracts (ESPCs) and
Utility Energy Service Contracts (UESCs), to implement energy
efficiency improvements in our existing buildings. Under these
contracts private energy firms or utility companies make energy
upgrades to our buildings and are paid back over time using utility
bill savings.
Facilities Energy Management
With respect to facilities energy management the Department has
made great progress towards improving the energy efficiency of its
installations. Since fiscal year 2009, the Department reduced the
energy consumed on our military bases by 10 percent, avoiding over $1.2
billion in operating costs.
In addition to using appropriated funding for energy conservation
and efficiency initiatives, the Department is continuing to take
advantage of third-party financing tools through energy performance
based contracts (ESPCs and UESCs) to implement energy efficiency
improvements in our existing buildings. While such performance-based
contracts have long been part of the Department's energy strategy, the
Services have significantly increased the use of ESPCs and UESCs in
response to the President's Performance Contracting Challenge (PPCC)
originally issued in December 2011 and extended in May 2014. The PPCC
challenged Federal agencies to award $4 billion in energy performance
based contacts by the end December 2016. The DOD's commitment to the
challenge is just over $2 billion in contracts. To date the Department
has awarded $1.3 billion in ESPCs and UESCs.
Regarding renewable energy, the Department has a goal to deploy 3
gigawatts of renewable energy by fiscal year 2025. Most renewable
energy projects we pursue are financed by private developers. DOD's
authorities for renewable energy--particularly the ability to sign
power purchase agreements of up to 30 years--provide incentives for
private firms to fund the projects themselves, and can also provide a
strong business case that they are able to offer DOD lower energy rates
than are being paid currently. The DOD does not make any capital
investment in these renewable energy projects. When feasible, renewable
energy projects are being built with micro-grid-ready applications that
can enable the provision of continuous power in the event of a
disruption.
As of the end of fiscal year 2015 the Department has 702 megawatts
in renewable energy projects in operation. The services also have more
than 550 megawatts of projects under construction including a 15 MW
Solar PV/50 MW wind ``hybrid'' project at Ft Hood, Texas and an off-
site 210 MW solar PV facility that will supply power to 14 Department
of Navy installations in California. Further, there is another 1.3
gigawatts of renewable energy projects in various stages of
development; putting the Department well on track towards meeting its 3
gigawatt goal.
Highlighted Issues
merger of the energy, installations, and environment organizations
As you know, the fiscal year 2015 National Defense Authorization
Act directed the merger of the Assistant Secretary of Defense for
Operational Energy Plans and Programs and the Deputy Under Secretary of
Defense for Installations and Environment to create the Assistant
Secretary of Defense for Energy, Installations and Environment. The ASD
(EI&E) is now the principle advisor to the Secretary of Defense for
Acquisition, Technology, and Logistics on matters relating to energy,
installations, and environment and the principal advisor to the
Secretary of Defense and the Deputy Secretary of Defense regarding
operational energy plans and programs.
The Department is currently developing the required report on the
status of the merger, and will provide that to the Congress later this
year. I can tell you that through the merger operational energy
functions have benefited from additional resources and collaboration
with complementary functions related to installation energy, facilities
investment and management, and basing.
base realignment and closure
Given the need to find efficiencies and reexamine how our
infrastructure is configured, the Administration is requesting the
authority from Congress to conduct a 2019 BRAC round. As indicated in
testimony last year, the Department has excess capacity. The Army and
Air Force have analyzed their infrastructure and have found that they
have 18 percent and 30 percent excess capacity, respectively. We are
currently conducting a DOD wide parametric analysis as directed by the
fiscal year 2016 National Defense Authorization Act, which will likely
indicate excess of around 20 percent. This level of excess is not
surprising given the fact that in 2004 we found that the Department had
24 percent excess and BRAC 2005 reduced infrastructure by 3.4 percent
(as measured by plant replacement value).
As we have said, a new BRAC round will be different than BRAC 2005.
The new round will be efficiency focused. It will save about $2 billion
a year after implementation; with costs and savings during the 6 year
implementation being a wash at approximately $7 billion. Our projection
is based on the efficiency rounds of the 1990s.
In addition to being a proven process that yields savings, BRAC has
several advantages that we have outlined before in our testimony. I
want to highlight a few of these:
--BRAC is comprehensive and thorough--all installations are analyzed
using certified data aligned against the strategic imperatives
detailed in the 20-year force structure plan;
--The BRAC process is auditable and logical which enables the
Commission to conduct an independent review informed by its own
analysis and testimony from affected communities and elected
officials;
--The Commission has the last say on the Department's
recommendations--being fully empowered to alter, reject, or add
recommendation;
--The BRAC process has an ``All or None'' construct which prevents
the President and Congress from picking and choosing among the
Commission's recommendations; thereby insulating BRAC from
politics;
--The BRAC process imposes a legal obligation on the Department to
close and realign installations as recommended by the
Commission by a date certain that facilitates economic reuse
planning by impacted communities and grants the Department the
authorities needed to satisfy that legal obligation.
In recognition of your concerns about cost and the amount of time
the BRAC Commission has to review our recommendations, the Department's
request for BRAC authorization includes four key changes from prior
year submissions as well as a handful of administrative and timeline
changes. Each of the changes are narrowly tailored to address
congressional cost concerns while not altering the fundamental
principles of the BRAC process: treating all bases equally; all or none
review by both the President and Congress; review by an independent
Commission; making military value the priority consideration; and a
clear legal obligation to implement all of the recommendations in a
time certain together with all the authorities needed to accomplish
implementation.
To ensure the next BRAC round is focused on saving money and
maximizing efficiency, our legislation adds a requirement for the
Secretary of Defense to certify that the BRAC round will have the
primary objective of eliminating excess infrastructure to maximize
efficiency and reduce cost. Like the existing requirement to certify
the need for a BRAC round, this certification occurs at the outset of
the BRAC process and is a precondition to moving forward with
development of recommendations. Additionally, subject to the
requirement to give priority consideration to the military value
selection criteria, the legislation now requires the Secretary to
emphasize those recommendations that yield net savings within 5 years
of completing the recommendation and limits the Secretary's ability to
make recommendations that do not yield savings within 20 years. In
order to make a recommendation that does not yield savings within 20
years, the Secretary must expressly determine that the military value
of such recommendation supports or enhances a critical national
security interest of the United States.
Finally, the legislation also now specifically delineates those
costs that must be considered when determining the costs associated
with a recommendation. As revised, the legislation specifies that the
Department must consider costs associated with military construction,
information technology, termination of public-private contracts,
guarantees, the costs of any other activity of the Department of
Defense or any other Federal agency that may be required to assume
responsibility for activities at the military installations, and such
other factors as the Secretary determines as contributing to the cost
of a closure or realignment. Previous versions of the legislation had
only specifically mentioned the costs of any other activity of the
Department of Defense or any other Federal agency that may be required
to assume responsibility for activities at the military installations
Our proposal extends the Commission review period to run from April
15 to October 1 which adds 2 months to Commission review and requires
that Commissioners be named by February 1 which enables the Commission
to be up and running for ten weeks before our recommendations come to
them. Our revision also requires the Chair of the Commission to certify
that the Commission and its staff have the capacity to review the
Department's recommendations.
Heretofore, we've addressed every concern raised by Congress. We
conducted the European Infrastructure Consolidation to address concerns
that we need to look at overseas installations first; we programmed the
costs and pledged the next round will reduce excess instead of the 2005
round's more costly ``transformation'' focus in response to concerns
that we could not afford BRAC; and we have demonstrated that excess
capacity exists--Army and Air Force testified to 21 and 30 percent.
We've updated our DOD-wide (parametric) analysis and will provide it to
Congress soon; it indicates over 20 percent excess.
We hope the Department's efforts will result in a real dialog with
members of Congress regarding the need for and value of the BRAC
process, ultimately resulting in authority for a 2019 BRAC round.
european infrastructure consolidation
In response to our recent requests for BRAC authority, Congress
made it clear that it wanted DOD to look at reducing our overseas
infrastructure first--particularly in Europe. We did so by conducting
the European Infrastructure Consolidation (EIC) analysis--the first
holistic and joint review of our legacy infrastructure in Europe.
To analyze our European infrastructure we used a process very
similar to the proven U.S. BRAC process. We looked at capacity,
requirements (including surge), military value, cost, and the
diplomatic dynamics involved with each action. As we consolidate our
footprint, the infrastructure remaining in place will continue to
support our operational requirements and strategic commitments, but we
will not need as many support personnel (military, civilian, and host
nation employees) to do so.
The 26 approved EIC actions will allow us to create long-term
savings by eliminating excess infrastructure without reducing our
operational capabilities. In other words, operationally we will
continue to do everything we currently do but at a lower cost. After a
one-time investment of approximately $800 million in Military
Construction to implement 2 major base closures, 8 minor site closures,
and 16 realignment actions, the Department will realize approximately
$500 million in annual recurring savings.
These actions will be executed over the next several years, but
that does not mean that everything will remain static in Europe while
these changes occur. There were consolidations made before EIC and
there will undoubtedly be future basing actions--especially given the
evolving security environment. However, our holistic review and the
resultant actions allow us to redirect resources supporting unneeded
infrastructure and apply them to higher priorities, thus strengthening
our posture in Europe.
Although we continually seek efficiencies as we manage
installations worldwide, the Department does not conduct this degree of
comprehensive analyses of its infrastructure on a regular basis. That's
one of the reasons we have requested BRAC authority from Congress to do
a review of our U.S. installations. In this fiscal environment it would
be irresponsible of us not to look for such savings.
Rebalance to the Asia-Pacific
rebasing of marines from okinawa to guam
The movement of thousands of Marines from Okinawa (and elsewhere)
to Guam is one of the most significant re-basing action in recent
years. We appreciate Congress' support allowing us to move forward on
this essential component of our rebalance to the Asia-Pacific region,
resulting in a more geographically dispersed, operationally resilient,
and politically sustainable posture in the area. As a U.S. territory,
Guam offers strategic advantages and operational capabilities that are
unique in the region. Presence in Guam is a force multiplier that
contributes to a force posture that reassures allies and partners and
deters aggression.
Now that the very complex National Environmental Policy Act (NEPA)
process (nearly 5 years of study) is complete, there is a clear path
for construction to proceed in earnest. Utilities and site improvements
( $300 million funded by the GoJ) for the main cantonment area at
Finegayan, and a live-fire training range ($125 million) at Andersen's
Northwest Field will be the first projects under the new Record of
Decision (ROD). Construction for the Marine Aviation Combat Element
(ACE) at the North Ramp of Andersen proceeded earlier because it was
covered under the original 2010 ROD; it remains on track.
We understand Congress' concerns regarding both the cost and
feasibility of the relocation and we are firmly committed to the
principles of operational effectiveness and fiscal responsibility. We
remain confident in the estimate of $8.7 billion for the program, which
includes $3.1 billion provided by the Government of Japan (GoJ) ($1.152
billion transferred to date). The Department is evaluating this program
in advance of each year's budget submission to pursue efficiencies that
have the potential to reduce overall cost. For example, the
Department's decision to relocate housing to Andersen Air Force Base
reduced the requirement for a water works project (at the main
cantonment area) saving the Department approximately $50 million.
Additionally, we continue to provide the necessary oversight,
conducting quarterly Deputy Secretary led Guam Oversight Council
meetings to address issues related to the program's implementation.
The Marines, in conjunction with the Naval Facilities Engineering
Command (NAVFAC), have an established program management organization
for construction execution and oversight. NAVFAC is standing up an
Officer in Charge of Construction office and anticipates it will be in
place by the first quarter of 2017. The Marines continue with planning
to meet operational requirements on the ground. This is the largest
infrastructure program ( $9 billion) that has been executed in many
years, so it is prudent to have the necessary management structure in
place to ensure success.
The Economic Adjustment Committee Implementation Plan (EIP)
(submitted to Congress in October 2015) was the last Congressional
requirement restricting project execution on Guam. The Plan outlines
the five ``outside the fence'' projects (listed in the table below)
associated with the impacts of the build-up on Guam's civilian
infrastructure. Last year's fiscal year 2016 NDAA provides
authorization for moving forward with the water/wastewater projects--
but not for the cultural repository and the public health lab projects.
Our fiscal year 2017 President's budget requests authority for these
two projects and the balance of funding ($87 million).
TABLE 7: EAC PROJECTS SUPPORTING DON RECORD OF DECISION
----------------------------------------------------------------------------------------------------------------
Previous Fiscal Fiscal Year 2017
Project Title Project Total ($ Year(s) Appropriated Request ($
Millions) ($ Millions) Millions)
----------------------------------------------------------------------------------------------------------------
Upgrade Wastewater Treatment Plan............. 139 71 68
Refurbishment sewer line Andersen AF.......... 31 31 0
Repair/expansion Aquifer monitoring system.... 4 4 0
Public Health Laboratory...................... 32 13 19
Cultural Repository........................... 12 12 0
-----------------------------------------------------------------
Total................................... 218 131 87
----------------------------------------------------------------------------------------------------------------
The cumulative impact of this stationing was carefully evaluated
within the environmental analysis process and we determined that water/
wastewater, public health, and our obligation to care for artifacts
uncovered in our construction need to be addressed. The associated
projects total $218 million, which is a relatively small, but
absolutely necessary, portion of this relocation.
Failure to provide authorization for these projects increases the
risk of litigation and project delay and will affect DOD's credibility
with the Guam's populace. Our inability to meet commitments to the
Government of Guam will also adversely affect our credibility with the
Government and people of the Commonwealth of Northern Mariana Islands
(CNMI) since they have similar concerns, as discussed below.
commonwealth of northern mariana islands (cnmi) initiatives
The Department continues to pursue two key military initiatives in
CNMI--the CNMI Joint Military Training (CJMT) Complex (a U.S. Pacific
Command (PACOM) initiative (led by USMC) to reduce joint training
deficiencies in the Western Pacific); and an Air Force Divert and
Exercise Field on Tinian.
PACOM requires a Joint Military Training Complex in-theater to meet
Department of Defense training requirements in the theater. The Complex
will make a key contribution to the readiness of Marines relocating to
Guam and provide bilateral and multilateral training opportunities with
foreign allies and partners. The Department sought to design the CJMT
complex on Tinian and Pagan in a manner that minimizes the impacts on
the local communities and provides direct economic and other benefits
while meeting PACOM and its Service Components' training requirements.
The training complex includes a series of live-fire Range Training
Areas, training courses, maneuver areas, and associated support
facilities located in close proximity to each other. The total cost of
the complex is $900 million with GoJ contributing $300 million. In
April 2015, the Department of Navy (DON) released the draft
Environmental Impact Statement (DEIS) for the proposed action with an
original public comment period of 60 days (extended to 180 days to
accommodate requests by the CNMI Governor to give him more time in
light of Internet problems and damage from Typhoon Soudelor). In
response to the over 28,000 comments received in October 2015 the DON
announced its intent to prepare a Revised DEIS to more fully address
potential impacts to water, coral, and other natural resources. The DON
now estimates the ROD will be issued in the summer of 2018. This
timeline still supports force flow to Guam in 2022.
The Air Force needs to establish a divert capability for up to 12
tankers if access to Andersen Air Force Base is unavailable. The Air
Force proposes to construct facilities and infrastructure to support a
combination of cargo, tanker, and similar aircraft and associated
personnel not only for divert operations, but also to support periodic
exercises and disaster relief activities. Efforts to establish this
capability are on track for a Record of Decision in mid-April 2016. The
Air Force is now pursuing a Tinian-only solution consistent with CNMI's
desires.
building and maintaining resilience in the face of a changing climate
Resilience to climate change continues to be a priority for the
Department. Both the 2010 and 2014 Quadrennial Defense Reviews (QDRs)
discussed the impacts associated with a changing climate that present a
threat to DOD's national security mission. We recognize these impacts
and their potential threats represent one more risk that we must
consider as we make decisions about our installations, infrastructure,
weapons systems and, most of all, our people. We have always dealt with
the risks associated with extreme weather events and its impacts on our
operations and missions. Our challenge today is how to plan for changes
in the environment we will be operating from and in.
Even without knowing precisely how or when the climate will change,
we know we must build resilience into our policies, programs, and
operations in a thoughtful and cost effective way. In January 2016, we
issued a DOD Directive on climate change adaptation and resilience that
identifies roles and responsibilities across the Department for
implementing these strategies over the next 10 years.
Specifically, I am focusing on our installations and
infrastructure. Sea level is rising and many coastal areas are
subsiding or sinking. This impacts the operation and maintenance of our
existing installations and infrastructure. As Arctic Sea ice melts and
breaks apart, our early warning radar sites are being eroded away at a
much greater rate than before. Drought and flooding, which ironically
go together, threaten water resources for us and our surrounding
communities and exacerbate wildfire issues across the country.
The Military Services have conducted a screening level assessment
of all DOD sites world-wide to identify where we are potentially
vulnerable to extreme weather events and tidal anomalies today. The
information gleaned from this initial look will help to focus reviews
of installation footprints, and shape planning for current and future
infrastructure.
Given the projected increases in major storms, DOD continues its
progress to ensure energy resilience for its military installations. We
completed our power resilience review, and are now updating Department-
level instructions to include energy resilience requirements. These
requirements will ensure that the Department has the ability to prepare
for and recover from energy disruptions that impact mission assurance
on its military installations.
Our goal is to increase the Department's resilience to the impacts
of climate change. To achieve this goal, we are integrating
consideration and reduction of climate risks into our already
established mission planning and execution.
financial improvement & audit readiness
In order to effectively manage its financial resources, the
Department remains focused on improving financial record keeping and
conducting an independent audit of DOD's financial books beginning in
fiscal year 2017. This includes not only an audit of the Department's
Statement of Budgetary Resources, but also validating the existence and
completeness, rights and obligations, and financial valuation of
slightly less than 562,000 facilities located at 513 installations
world- wide. The results of a more accurate and reliable real property
inventory will better inform our decisions and actions in addressing
our real property management challenges.
The Department has made significant progress towards the
environmental liabilities associated with our cleanup program and
disposal of equipment aspects of the financial audit. Last fall we
issued clarifying policies through which we are refining the cost
estimates associated with those liabilities; thereby giving the
Department a better understanding of our future environmental costs and
the ability to plan for any required remediation.
mission compatibility evaluation process
The Department appreciates the legislative changes made in fiscal
year 2016 to section 358 of the Ike Skelton National Defense
Authorization Act of Fiscal Year 2011. These changes significantly
streamlined the Mission Compatibility Evaluation Process, and ensured
that DOD's mission capabilities are protected from incompatible energy
developments. As a result of congressional direction and our own
efforts we are effectively evaluating the mission impact of utility-
scale energy projects, while being mindful of the need for a clean
energy future. In 2015 the Department reviewed over 3,400 applications
for energy projects that were forwarded by the Federal Aviation
Administration. The DOD Siting Clearinghouse worked aggressively with
the Military Departments, energy project developers, and relevant
States to implement affordable and feasible mitigation solutions where
DOD missions might have been adversely impacted. No project reviewed in
2015 rose to the level of an unacceptable risk to the national security
of the United States, which is the threshold established in Section 358
of the fiscal year 2011 NDAA to object to a project. The Department is
prepared for an increased number of renewable energy project
developments as newly approved tax credits become available to
developers.
conclusion
Thank you for the opportunity to present the President's fiscal
year 2017 budget request for DOD programs supporting installations,
energy, and the environment. Our budget situation requires that we take
risk in our facilities. No one is happy about that, but we are
effectively managing within this budget constrained environment and we
appreciate Congress' continued support for our enterprise and look
forward to working with you as you consider the fiscal year 2017 budget
request.
Senator Kirk. Thank you.
Department of the Army
STATEMENT OF HON. KATHERINE HAMMACK, ASSISTANT
SECRETARY OF THE ARMY, INSTALLATIONS,
ENERGY, AND ENVIRONMENT
Ms. Hammack. Good morning, Chairman Kirk, Ranking Member
Tester, and distinguished members of the subcommittee. I am
here to present the Army's fiscal year 2017 budget for
Installations, Energy, and Environment.
Chairman Kirk, to your comment on how this supports
combatant commanders of the Army's military construction
(MILCON) budget (of the Army's budget of about $1 billion), a
little over 28 percent supports combatant commanders'
requirements.
And our budget is at historic lows. We haven't seen this
low of a budget since 1993. It is an 18-percent reduction from
last year's budget.
To Pete Potochney's comments, we are struggling in an era
with very low toplines, and the Army has decided to take
strategic risk in funding installations, so that we can support
soldier readiness.
Twenty-three percent of our MILCON request goes to the
National Guard. It is about $233 million. That is to support
readiness centers as part of the total force strategy.
The National Guard put together a readiness center
transformation master plan, which identifies that there are
critical facility shortfalls. Those are not only in the
National Guard, but they are across the Army. Our budget
addresses some of the shortfalls in the National Guard. It is a
step toward achieving the objectives they identify.
But the National Commission on the Future of the Army, a
report that was issued in January, identifies that Congress and
the administration should look for cost saving opportunities in
areas such as energy savings and reduced inventory of military
facilities.
So with the planned reductions in the Army in force
structure, we will have an excess of 21 percent. If the Army
has to get smaller, our excesses will only increase.
So therefore, I echo Mr. Potochney's request for a BRAC
authorization. The Army estimates that it could save over $500
million annually, and that is money that we could invest in
training. That is money that we could invest in force structure
to ensure that we can support this Nation the way we need to.
Without a BRAC, we continue to spend scarce resources to
maintain unneeded infrastructure or underutilized
infrastructure. I believe this is an unacceptable result for
the Army and a disservice to the American taxpayer, so I look
forward to working with Congress to help shape a future BRAC
round.
We are focused on energy efficiency. We have seen a
reduction in our energy consumption by over 22 percent in the
last 10 years. We have a focus on renewable energy, and our
renewable energy program is primarily funded with private-
sector capital where we are leveraging the private sector to
install renewable energy systems on our bases at no cost to the
Army, and we are going to see over $250 million savings in
projects already identified.
At the same time, we have over 12 million acres of land
that have historic characteristics, and over 200 endangered
species. That requires a little over $1 billion to ensure that
we are meeting our environmental requirements, so that the Army
can train and test the way that is needed.
But the Army's top priority remains readiness. So this
budget is focused on ensuring we can get as much readiness as
possible out of limited dollars, but supporting the soldiers
and trying to get them the quality of life that they require.
Thank you for the opportunity to appear before you today
and I look forward to your questions.
[The statement follows:]
Prepared Statement of Hon. Katherine G. Hammack
introduction
Chairman Kirk, Ranking Member Tester, and members of the
subcommittee: on behalf of the soldiers, families, and civilians of the
United States Army, thank you for the opportunity to present the Army's
fiscal year 2017 budget request for Installations, Energy, Environment,
and Base Realignment and Closure.
The U.S. Army's top priority continues to be readiness: the Army
must be ready to shape the global security environment, defend our
homeland, and win the Nation's wars. To meet these missions, the Army
requires ready and resilient installations--our power projection
platforms--to enable regional engagement and global responsiveness. Our
fiscal year 2017 budget request reflects the Army's decision to take
risk in our installation facilities and services to maximize available
funding for operational readiness and modernization. The request
focuses our limited resources on necessary and prudent investments in
military construction, installation energy programs supporting
operational activities, and environmental compliance.
The Army recognizes that reduced funding of installations accounts
will lead to the continued degradation of our facilities and
infrastructure, and risks our long-term ability to adequately support
Army forces and meet mission requirements. The Army is stretched thin
at a time when we are facing a global security environment that is more
uncertain than ever. Without increased funding in the outyears or the
authority to close and realign our installations, these problems will
only get worse--expending precious funds and putting the readiness and
welfare of our soldiers at risk. It is therefore particularly critical
that we maximize the efficient use of our resources at this time to
meet mission requirements and ensure soldier readiness.
The Army's fiscal year 2017 military construction appropriations
request strikes a careful balance to meet these growing and changing
demands. We look forward to working with Congress to ensure that our
national security needs and priorities are met in the upcoming fiscal
year and well into the future.
making efficient use of army facilities
To meet readiness requirements, the Army must maintain
installations that make efficient and effective use of available
facilities. Army installations should be sized and resourced to meet
the needs of our current and future missions, both at home and
overseas.
Efficient use of our installations includes the closure of low
military value installations and the divestment of excess facilities
that burden Army budgets. Reducing the portfolio of Army facilities was
among the recommendations of the National Commission on the Future of
the Army (NCFA), established by Congress as part of the fiscal year
2015 National Defense Authorization Act (NDAA). The NCFA's report,
released in January 2016, states that ``Congress and the Administration
should look for cost-saving opportunities in areas such as . . . a
reduced inventory of military facilities.'' \1\ The report recommends
that the Army pursue these and other efficiency initiatives to free up
funds that could be used to meet warfighting needs and other high-
priority initiatives identified by the Commission.
---------------------------------------------------------------------------
\1\ National Commission on the Future of the Army, ``Report to the
President and Congress of the United States,'' 28 January 2016, p. 44:
Recommendation 5.
---------------------------------------------------------------------------
The Army has made every effort to be fiscally prudent in the
maintenance of excess infrastructure. The Army has employed its current
authority to minimize costs and maximize the use of existing
facilities. We have identified and are working to reduce excess
capacity overseas through the European Infrastructure Consolidation
(EIC) initiative, in addition to implementing efficiency measures
across the board. Nevertheless, the modest savings attained from these
efforts cannot substitute for the significant savings that can be
achieved through base realignments and closures. Without them, the Army
is forced to make deep cuts at our highest military value installations
because we continue spending scarce resources maintaining and operating
lower military value installations.
As the Army is planning to reduce its Active Component end strength
to 450,000 by fiscal year 2018, we will have over 170 million square
feet of facilities that are not fully utilized--an excess facility
capacity averaging 21 percent. Depending on the facility type, the
excess infrastructure ranges from 18 percent to 33 percent. At an
annual cost of about $3 per square foot to maintain these facilities,
the Army is incurring over $500 million a year in unnecessary
expenditures. If fiscal year 2018-2021 budget caps remain, the Army
will need to further reduce the number of soldiers, and our excess
capacity will continue to increase.
The Army cannot afford this status quo. Although Base Realignment
and Closure (BRAC) forces difficult choices affecting the local
communities surrounding our installations, they are already seeing
fewer and fewer soldiers and families as force structure continues to
decline. BRAC allows the Army to use a fair and non-partisan process to
close a few lower military value locations and realign the remaining
missions to help fill the excess capacity at our higher military value
installations.
Not authorizing BRAC is still a choice with real consequences. The
lack of authorization for a BRAC results in our highest military value
installations bearing the deepest impacts. This is an unacceptable
result for the Army and a disservice to American taxpayers.
Facilities needed to support readiness, training exercises,
airfields, and other priorities are deteriorating, while resources are
diverted to supporting installations that could be closed. The Army
cannot carry excess infrastructure costing over half a billion dollars
per year indefinitely. Half a billion dollars represents the annual
personnel costs of about 5,000 soldiers, which is slightly less than
the number assigned to a Stryker Brigade Combat Team. It represents
five annual rotations at the Army's Combat Training Centers, which are
the foundation of Army combat readiness.
Until we get the BRAC authority to analyze what types of excess
exist at individual installations and develop recommendations on how to
best consolidate into the highest military value installations we have,
we do not know which lower military value installations should be
closed and/or realigned. However, we do know BRAC is a proven process
producing significant reoccurring savings of roughly $2 billion per
year for the Army, as validated by the Government Accountability Office
(GAO). A future BRAC round has the capability to save the Army hundreds
of millions of dollars per year. Once the up-front costs are paid, the
intermediate and long-term savings from BRAC can fund any number of
important Army warfighter initiatives, including force structure,
additional CTC rotations, and modernizations.
The BRAC process is a proven, cost-effective means for reducing
costly excess infrastructure, while ensuring a continued focus on
efficiency and consolidation. The Army strongly supports DOD's request
for a BRAC round, and urges Congress to enact legislation in fiscal
year 2017 authorizing the Department to begin the process.
preserving ready installations
Army installations--where soldiers live, work, and train--are where
Army readiness is built to meet future challenges and ensure the
security of our Nation. Increasing global threats generate installation
requirements for force protection, cyber security, and energy security.
Installation budgets provide the premier all-volunteer Army with
facilities that support readiness and quality of life for our soldiers,
families, and civilians.
The Army continues to focus its limited resources on supporting
readiness initiatives and replacing failed facilities. As we remain
under pressure from current law budget caps, our installation services
must continually be adjusted. Increases in deferred maintenance and
reduced investments in installations and infrastructure ultimately
increase our growing backlog of failing facilities. This degrades the
Army's ability to be ready to project full spectrum forces over time.
Excess facility capacity burdens the Army sustainment and base
operations--consuming limited dollars that need to be better invested
elsewhere.
Sustainment, Restoration, and Modernization (SRM) accounts fund
investments to maintain and improve the condition of our facilities.
Periodic restoration and modernization of facility components are
necessary to ensure the safety of our soldiers and civilians. Efforts
are focused on preventing the degradation of our facilities and
optimizing the use of Army investments, to prevent small maintenance
issues from turning into large and expensive problems.
The fiscal year 2017 $3.1 billion budget request will help support
our sustainment and restoration requirements. However, the Army is
assuming risk in installation readiness to preserve operational
readiness. The $2.7 billion request for Sustainment meets 71 percent of
our Facility Sustainment Model for long-term sustainment, whereas DOD
recommended meeting an 80 percent threshold to stem the tide of further
facility degradation.
Reduced funding in the outyears for installation readiness
adversely impacts facility condition and ultimately increases future
military construction and restoration and modernization requirements.
This shifts the Army's investment focus to the worst facilities,
diverting resources needed to preserve our newest and best
infrastructure. Deferred sustainment over the long term can lead to
higher life-cycle repair costs and component failure, significantly
reducing facility life expectancy.
Responsibly managing over 12 million acres of real property also
means that the Army must maintain extensive base operations. Through
funding for Base Operations Support (BOS) accounts, Army installations
provide services similar to those associated with a municipality:
public works, security protection, logistics, environment, and Family
programs. These programs and services enable soldiers, civilians, and
families to live and work on 154 Army installations worldwide.
Balancing BOS needs in a changing global environment calls for
continued due diligence. The President's fiscal year 2017 budget
therefore requests a total of $9.43 billion for BOS accounts, including
$7.82 billion for the Active Component; $1.04 billion for Army National
Guard; and $573.8 million for Army Reserve.
investing in essential infrastructure
The Army's request for Military Construction provides secure and
sustainable facilities and infrastructure critical to supporting the
Combatant Commander's top priorities, enabling Army missions, and
maintaining soldier and unit readiness. For fiscal year 2017, the Army
requests just over $1 billion for Military Construction, a reduction of
$229 million--18 percent--from fiscal year 2016 appropriations. The
budget allocates $503 million (approximately 50 percent) for the Active
Component; $233 million (23 percent) for the Army National Guard; $68
million (7 percent) for Army Reserves; and $201 million (20 percent)
for Army Family Housing Construction.
The Army continuously reviews project scope and costs. We must
continue to adapt to evolving missions, account for emerging
organizational changes, and meet unit readiness needs, while
simultaneously seeking efficiencies at every opportunity. However,
funding for Army Military Construction has reached historically low
levels. This reduces the Army's ability to recapitalize inadequate and
failed facilities into infrastructure that supports operations,
readiness, and the welfare of the all-volunteer force.
The Army National Guard (ARNG) is the oldest component of the U.S.
Armed Forces. The Guard has courageously participated in every war and
every conflict this Nation has ever fought, including Iraq and
Afghanistan, and is our first line of defense in responding to domestic
emergencies. These men and women perform an important mission for our
country, and our military construction budget endeavors to ensure that
the needs of their facilities are met.
The Guard's fiscal year 2017 Military Construction request is
$232.9 million. This includes $161.3 million to support seven Readiness
Centers, $50.9 million to construct three maintenance facilities, $12
million to fund minor projects, and $8.7 million for planning and
design. Our ARNG budget request is focused on recapitalizing readiness
centers--the heart and soul of the National Guard--as well as
maintenance facilities, training areas, ranges, and barracks to allow
the Guard to be ready to perform State and Federal missions. These
projects will address space constraints and focus on replacing failing
facilities.
In the 2014 ARNG Readiness Center (RC) Transformation Master Plan,
a key finding was that the RC portfolio is experiencing ``critical
facility shortfalls.'' This budget request is a small step toward
addressing the ARNG's challenges.
The fiscal year 2017 budget request for the Army Reserve totals
$68.2 million, with four critical projects totaling $57.9 million.
Three of these will focus on replacing some of our most dilapidated and
failing facilities on Army Reserve installations that are in the most
dire need. This includes $21.5 million to replace an Emergency Services
Center at Fort Hunter Liggett, California--currently in failing
condition--which will provide life-saving police, fire, crash and
rescue, and Emergency Medical Team (EMT) services. An additional $10.3
million will support planning and design of future year projects, as
well as to address unforeseen critical needs through the Unspecified
Minor Military Construction account.
The Army Family Housing budget allows us to provide homes and
services to the soldiers and their families living on our installations
around the world. For fiscal year 2017, the Army requests $200.7
million for family housing construction. This will fund two projects in
Korea, at Camp Humphreys and Camp Walker, critical to supporting
consolidation and quality of life for our soldiers and their families.
The projects are necessary to eliminate dilapidated family housing
units and meet the U.S. Forces Korea (USFK) Commander's requirements
for housing. An additional $326 million is requested to help sustain
all family housing operations, cover utility costs, ensure proper
maintenance and repair of Government family housing units, lease
properties where advantageous, and provide privatization oversight and
risk mitigation.
ensuring energy security
It is operationally necessary, fiscally prudent, and mission
essential that the Army have assured access to the energy required to
achieve our primary objectives for the United States. The Army has led
the way toward increasing energy efficiency on our installations,
harnessing new energy technologies to lessen soldier battery loads, and
improving our operational capabilities to reduce the need for fuel
convoys. Our installation energy budget request is focused on enhancing
mission effectiveness, and is supported by strong business case
analyses. For fiscal year 2017, the Army is requesting $1.716 billion
to pay utility bills on our installations, leverage private sector
investment in renewable energy projects, and invest in discrete energy
efficiency improvements.
In response to risks posed to our vulnerable energy grid, the Army
is improving the ``resiliency'' of its installations through the use of
on-base renewable sources of energy. A resilient Army installation is
one that can withstand threats to its security--be they power
interruptions, cyber-attacks, or natural disasters--and endure these
hazards to continue its own operations and those of the local
community. With this in mind, the Army conducted a test and temporarily
disconnected Fort Drum, New York from the energy distribution network
this past November, validating the installation's ability to operate
independently from the wider grid.
The Army leads the Federal Government in the use of Energy Savings
Performance Contracts (ESPCs) and Utility Energy Service Contracts
(UESCs), which allow private companies and servicers to provide the
initial capital investment needed to execute projects using repayments
from Utilities Services Program savings. The amount of energy saved by
Army ESPC and UESC projects awarded between fiscal year 2010 and fiscal
year 2015 is equal to the amount of energy consumed by Fort Bragg--one
of the Army's largest and most populous installations--in a year. In
total, the Army has reduced its facilities energy consumption by 22.6
percent since fiscal year 2003, while also leading the Federal
Government in reductions of its potable water intensity use and non-
tactical vehicle (NTV) fossil fuel use.
In addition, our energy program account funds the Office of Energy
Initiatives (OEI), which helps to plan and develop third party-financed
renewable energy projects. OEI currently has 14 projects completed,
under construction, or in the final stages of the procurement process--
together providing an incredible 350 megawatts (MW) of generation
capacity. These projects represent over $800 million in private sector
investment, saving funds that would otherwise be appropriated for
military construction. Further, all of these projects provide
electricity that is at or below the cost of conventional power.
The Army's operational energy initiatives provide extended range
and endurance, increased flexibility, improved resilience, and force
protection, all while enhancing mobility and freedom of action for our
soldiers. Operational energy investment in science and technology has
been a proven force multiplier, providing our soldiers with a distinct
advantage on the battlefield. Therefore, the bulk of our operational
energy budget request, $1.28 billion, is for investments in energy
efficient equipment by the Army acquisition community that will reduce
physical and logistical burdens on our soldiers and, most importantly,
help save lives.
The Army's energy program has proven results--reducing our reliance
on the grid, improving energy security and efficiency, and contributing
to mission readiness--all at a minimal impact to Army budgets. Energy
performance on our installations is a testament to the Army's success
in leveraging its limited resources to achieve considerable results. We
urge Congress to continue to support the Army's energy initiatives both
in operational and installation environments.
safeguarding our environment
The mission of the Army's environmental program is three-fold: (1)
to comply with environmental laws and regulations and ensure proper
stewardship of our natural, cultural, and Tribal resources; (2) to meet
DOD's goals for installation restoration and munitions response; and
(3) to invest in environmental technology research, development,
testing, and evaluation.
The Army manages over 12 million acres of land, which requires the
Army to protect endangered species and historic sites or structures.
Efforts are made to remediate environmental contaminants that pose a
danger to human health or the environment, while supporting Army
operations and our soldiers, families, and communities. Our fiscal year
2017 budget request of $1.05 billion will allow the Army to fulfill
these objectives, keeping the Army on track to meet our cleanup goals
and maintain full access to important training and testing lands, which
are integral components of Army readiness.
conclusion
Readiness is the U.S. Army's top priority--there is no other
``number one.'' The Army's fiscal year 2017 Military Construction
budget request takes moderate risk to ensure our readiness needs are
met by focusing our financial resources where they are needed most.
Maintaining failing facilities and low-military value installations
takes money away from critical investments in the readiness of our
soldiers and the acquisition of advanced weapons and technology. BRAC
allows the Army to optimize installation capacity and achieve
substantial savings, freeing up scarce resources that could easily be
applied elsewhere.
The strength of the U.S. Army is its people, and our installations
serve as the platforms for this strength. Without ready and resilient
installations, our soldiers will be ill-equipped to fight the growing
threats facing our Nation. We owe it to our men and women who wear the
Army uniform to be prudent in the use of our installation budgets and
prioritize them appropriately to ensure they have the best resources
available to defend our homeland.
Thank you for the opportunity to present this testimony and for
your continued support of our soldiers, families, and civilians.
Senator Kirk. Thank you.
Department of the Navy
STATEMENT OF STEVEN R. ISELIN, PRINCIPAL DEPUTY
ASSISTANT SECRETARY OF THE NAVY, ENERGY,
INSTALLATIONS, AND ENVIRONMENT
Mr. Iselin. Good morning, Chairman Kirk, Ranking Member
Tester, members of the subcommittee. I am Steve Iselin. I am
the Principal Deputy for Energy, Installations, and Environment
for the Department of the Navy and I am pleased to provide this
overview of our energy infrastructure and environmental
programs.
Navy and Marine Corps installations and facilities are
platforms for preparing marines and sailors; for deploying
ships, aircraft, and operational forces to meet their mission
requirements; and for supporting military families.
The President's fiscal year 2017 budget requests $11.9
billion to operate, maintain, and recapitalize these
installation platforms. That is about 10 percent less than the
fiscal year 2016 levels.
The Department, including the senior leaders of the
Department, realize this funding level impacts long-term
ownership costs and is mindful that continued funding at these
levels will cause degradation and future operational impacts.
Importantly, though, over the last few years, the
Department has significantly improved its condition assessment
process and its risk-based strategy to ensure the money we do
get supports the most critical projects.
The following are a few specifics from this year's request.
The request includes $1.1 billion for military construction
to support warfighting requirements and to modernize some
utility and critical infrastructure. It is a 35-percent
reduction from fiscal 2016 levels. And separately, the
Department provided an unfunded priority list that includes
other priority military construction projects that were
unaffordable within the available budget authority.
The request includes $1.9 billion for facility sustainment,
restoration, and modernization, also a decrease from last
year's levels. This funds Navy sustainment at 70 percent and
Marine Corps sustainment at 74 percent of the Department of
Defense (DoD) sustainment model.
We are continuing to carefully accept risk and recognize
that continued funding below these amounts will also cause our
portfolio to deteriorate. The unfunded priority list also
includes additional sustainment and restoration funding this
year.
The budget requests $7.6 billion for base operation
support. That is about the same level as last year. And both
the Navy and Marine Corps consciously invest at a level
necessary to meet minimum acceptable standards in how we
operate and maintain our facilities.
The request includes $1 billion to meet environmental
program statutory and stewardship responsibilities. We take our
environmental stewardship responsibilities seriously and are
really proud of our record in environmental planning,
compliance, and cleanup, and in our efforts to be good stewards
of cultural, natural, and historic resources.
The Navy and Marine Corps energy programs have two central
goals, first, enhancing combat capabilities, and second,
advancing energy security. Like the other services, we have
partnered with other government agencies, academia, and,
importantly, the private sector, and we are achieving these
goals with the same spirit of innovation that has marked our
naval history.
I must also say that I am very proud of the many dedicated
professionals who over the last 5 years have persevered despite
furloughs, pay and hiring freezes, limited awards and rewards,
reduced budgets, and restrictions on travel and training. They
have and will continue to effectively manage our Navy and
Marine Corps installations, despite the challenges and
constraints.
In conclusion, this year's budget request makes the
required investments to support current readiness while
accepting known risks in the sustainment and modernization
accounts. I appreciate the opportunity to testify today. I look
forward to your questions.
[The statement follows:]
Prepared Statement of Steven R. Iselin
Chairman Kirk, Ranking Member Tester, and members of the
subcommittee, I am pleased to appear before you today to provide an
overview of the Department of the Navy's (DON) investment in its
infrastructure, energy, and environment programs.
Our Navy and Marine Corps installations and facilities are the
platform to train and prepare our marines and sailors, to deploy ships,
aircraft and operational forces, as well as to support our military
families. We are stewards of a large portfolio of installations--valued
at $229 billion ($173 billion Navy and $56 billion USMC, respectively)
in plant replacement value--that is vital to our operational forces.
Against the backdrop of world events and competing requirements and
resources, we must balance our desired level of funding with the
principal purposes for our existence: to optimize readiness of the
operational forces and preserve their quality of life. Readiness-
enablers include runways, piers, operations & maintenance facilities,
communications & training facilities, and utilities; those that enable
quality of life include barracks, mess halls, and recreation and
fitness centers. We have a responsibility to balance the investments
for this portfolio according to current year authorizations while being
mindful of the impacts to life cycle and ever-evolving mission
requirements.
investing in our infrastructure
We thank Congress for passage of the Bipartisan Budget Act (BBA) of
2015, the National Defense Authorization Act (NDAA) for fiscal year
2016 and the Consolidated Appropriations Act, 2016. Although the BBA of
2013 provided some budget stability for fiscal year 2014-2015, and
limited relief from the Budget Control Act (BCA) of 2011 sequestration
levels, the unfortunate consequence of constrained DON funding levels
and timing is that many of our installations' piers, runways, and other
facilities are degrading. We continue to make progress in replacing and
demolishing unsatisfactory infrastructure, yet still have challenges
based on BCA caps and on the prospect of a return to sequestration
levels in fiscal year 2018.
In fiscal year 2017, the President's budget (PB) is requesting
$11.9 billion in various appropriations, a 10.4 percent decrease ($1.4
billion) from amounts appropriated in fiscal year 2016 to operate,
maintain and recapitalize our shore infrastructure. Figure 1 compares
the fiscal year 2016 enacted budget and the fiscal year 2017 PB request
by appropriation. Each appropriation is discussed more fully in the
following sections.
FIGURE 1: DON INFRASTRUCTURE FUNDING BY APPROPRIATION
----------------------------------------------------------------------------------------------------------------
Fiscal year President's
2016 budget 2017 Delta ($
Appropriation enacted ($ ($ millions) Delta (%)
millions) millions)
----------------------------------------------------------------------------------------------------------------
Military Construction, Active and Reserve.................. 1,739 1,126 -613 -35.3
Family Housing, Construction............................... 17 94 77 452.9
Family Housing, Operations................................. 353 301 -52 -14.7
BRAC....................................................... 170 154 -16 -9.4
Sustainment, Restoration and Modernization................. 3,110 2,356 -754 -24.2
Base Operating Support..................................... 7,625 7,610 -15 -0.2
Environmental Restoration, Navy............................ 300 282 -18 -6.0
----------------------------------------------------
Total................................................ 13,314 11,923 (1,391) -10.4
----------------------------------------------------------------------------------------------------------------
Notes:
MILCON, SRM and BOS include OCO
BOS includes BSIT
We strive to maintain a shore infrastructure that is mission-ready,
resilient, sustainable and aligned with Fleet and operational
priorities. Toward that end, and especially important given the risks
inherent at these funding levels, Navy and Marine Corps have taken
actions to more proactively manage the installations portfolio. For
example, Navy has taken the initiative to:
--Standardize the facility inspection and Facility Condition Index
(FCI) process that quantifies facility condition and documents
the needed maintenance and repair work within our facilities
portfolio. This information helps guide spending of available
dollars.
--Incorporate principles of condition-based maintenance across all
buildings, utilities and structures, in order to prioritize
work on only the most critical components (e.g. roofs and
exterior walls) at our most critical facilities or on
components that relate to life, health and safety. We are able
to focus resources on specific building components and systems
where failure jeopardizes personnel safety or a warfighting
mission.
--Led by Commander, Navy Installations Command, exercise a single
integrated forum to receive and adjudicate demand signals from
Fleet and Enterprise Commanders to identify and prioritize
projects, optimizing the available resources.
--Maintain focus on reducing footprint by demolishing or divesting
unneeded buildings as funds are available, and recapitalizing
existing facilities in lieu of new construction when possible.
--Supplement available appropriated dollars by the increased use of
authorities that leverage third party financing for improving
infrastructure while lowering energy consumption and energy
costs.
military construction (milcon)
Navy's MILCON program funds infrastructure at home and abroad,
supports our warfighters, and meets the objectives in CNO's Design for
Maintaining Maritime Superiority and the Secretary of Defense's
Strategic Guidance. Together, Navy and Marine Corps will invest $1.13
billion worldwide in military construction funds to support warfighting
and modernization of our utilities and critical infrastructure.
For Navy, the fiscal year 2017 request is for 25 projects, Planning
and Design and Unspecified Minor Construction, at a budget of $700
million, which is 29 percent lower than the fiscal year 2016 as-enacted
budget of $986 million. Navy has invested an average of $1 billion
annually in MILCON since 2010, and the fiscal year 2017 request is the
lowest since 1999. Navy continues to invest prudently in MILCON, but
assumes long-term risk in deferring recapitalization of our existing
infrastructure.
The Navy's fiscal year 2017 MILCON request supports Combatant
Commander requirements, enables new platforms/missions, upgrades
utilities and energy infrastructure, recapitalizes Naval Shipyard
facilities, and supports weapons of mass destruction (WMD) training
requirements. They include:
Combatant Commander Support ($233 million, 9 projects):
Medical/Dental Facility--Camp Lemonnier Djibouti
Harden POL Infrastructure--NAVBASE Guam
Coastal Campus Utilities Infrastructure--NAVBASE Coronado
Coastal Campus Entry Control Point--NAVBASE Coronado
Communication Station--NAVSTA Rota
Grace Hopper Data Center Power Upgrades--NAVBASE Coronado
Missile Magazine--NAVWPNSTA Seal Beach
P-8A Hanger Upgrade--NSA Naples (Keflavik, Iceland)
P-8A Aircraft Rinse Rack--NSA Naples (Keflavik, Iceland)
New Platform/Mission ($198 million, 6 projects):
UCLASS RDT&E Hangar--Naval Air Station PAX River
Triton Mission Control Facility--NAS Whidbey Island
Triton Forward Operating Base Hangar--VARLOCS
EA-18G Maintenance Hangar--NAS Whidbey Island
F-35C Engine Repair Facility--NAS Lemoore
Air Wing Simulator Facility--NAS Fallon
Utilities and Energy Infrastructure ($85 million, 4 projects):
Upgrade Power Plant & Electrical Distribution System--PMRF Barking
Sands
Energy Security Microgrid--Naval Base San Diego
Service Pier Electrical Upgrades--Naval Base Kitsap
Shore Power (Juliet Pier)--COMFLEACT Sasebo
Naval Shipyards ($76 million, 4 projects):
Sub Refit Maintenance Support Facility--Naval Base Kitsap
Nuclear Repair Facility--Naval Base Kitsap
Utilities for Nuclear Facilities--Portsmouth Navy Shipyard (New
Hampshire)
Unaccompanied Housing Consolidation--Naval Shipyard Portsmouth (New
Hampshire)
WMD Training ($21 million, 1 project):
Applied Instruction Facility--NAS Whiting Field, Milton, Florida
MILCON Reserves ($11 million, 1 project):
Joint Reserve Intelligence Center--NAS JRB New Orleans
For the Marine Corps, the fiscal year 2017 request is for 11
projects, Planning and Design and Unspecified Minor Construction, at a
budget of $426 million, which is 44 percent lower than the fiscal year
2016 as enacted budget of $754 million. Investments in MILCON will
primarily support new warfighting platforms, weapons support, force
relocation facilities (Rebalance to the Pacific, Aviation Plan),
improve security and safety posture, and recapitalize and replace
inadequate facilities. The 11 projects in the Marine Corps fiscal year
2017 MILCON budget include:
New Platform and Weapons Support Facilities ($110 million, 2 projects):
F-35 aircraft maintenance hangar at MCAS Beaufort, South Carolina;
and
F-35 aircraft maintenance shops at Kadena Air Base, Japan.
Facilities to Support Force Relocations/Increased Force Requirements
($119 million, 3 projects):
Aircraft maintenance hangar for VMX-22-MCAS Yuma;
Expansion of Reserve Center Annex--Galveston; and
Utility upgrades for Finegayan cantonment area--Guam.
Safety, Security, and Environmental Compliance ($31 million, 2
projects):
EPA-required central heating plant conversion--MCAS Cherry Point;
and
Range safety improvements at MCB Camp Lejeune.
Recapitalize and Replace Inadequate Facilities ($117 million, 4
projects):
Replace and consolidate communications, electrical, and maintenance
shops--MCB Hawaii;
Replace unreliable electrical power supply at reserve center--
Brooklyn, New York;
Replace reserve training facilities--Syracuse, New York; and
Modernize recruit barracks and construct a recruit reconditioning
center for injured recruits at MCRD Parris Island.
Reduced funding availability in MILCON will result in reduced
investments in projects that support the consolidation of functions or
replacement of existing facilities, which will cause degradation of the
long-term health of existing facilities.
Relocation of marines to Guam remains an essential part of the
United States' larger Asia-Pacific strategy of achieving a more
geographically distributed, operationally resilient and politically
sustainable force posture in the region. Guam provides a critically
important forward base for our expeditionary Marine ground and air
forces and also provides key sustainment capabilities for our forward-
deployed ships and submarines. The permanent basing of marines in Guam
significantly contributes to maintaining regional stability and
provides reassurance for key allies and partners across the Pacific
region.
family housing
The Department continues to rely on the private sector as the
primary source of housing for sailors, marines, and their families.
When suitable, affordable, private housing is not available in the
local community, the Department relies on government- owned,
privatized, or leased housing. The fiscal year 2017 request of $395
million supports Navy and Marine Corps family housing operation,
maintenance, renovation, and construction requirements. Of this amount,
$79 million is for the first phase of replacement of inadequate family
housing at Naval Support Activity Andersen, Guam and $11 million is for
the renovation of family housing at Marine Corps Air Station Iwakuni,
Japan. The budget request also includes $301 million for the daily
operation, maintenance, and utilities expenses of the military family
housing inventory.
To date, over 62,000 Navy and Marine Corps family housing units
have been privatized through the Military Housing Privatization
Initiative (MHPI). MHPI has enabled the Department to leveraged private
sector resources to improve living conditions for sailors, marines, and
their families.
facilities sustainment, restoration and modernization (fsrm)
To maximize support for warfighting readiness and capabilities, the
President's fiscal year 2017 budget request continues to carefully
accept risk in FSRM.
The fiscal year 2017 budget requests $1.9 billion to sustain
infrastructure, a 16 percent reduction from the fiscal year 2016
enacted value of $2.3 billion. Navy and the Marine Corps have resourced
fiscal year 2017 facilities sustainment at 70 percent and 74 percent,
respectively, of the Department of Defense (DOD) Facilities Sustainment
Model. Over time, this lack of sustainment will cause our facilities to
deteriorate.
To restore and modernize our existing infrastructure, the the
fiscal year 2017 budget request is $463 million, a 38 percent reduction
from the fiscal year 2016 enacted value of $749 million. Budget
constraints have compelled the Department to focus its limited
resources to address life/safety issues and the most urgent
deficiencies at our mission-critical facilities, piers, hangars,
runways and utility systems. We are committed to fully funding
infrastructure at strategic weapons facilities, accelerating Naval
shipyard infrastructure improvements, supporting the Marine Corps
Aviation Plan, and force relocations. However, as the Department defers
less critical repairs, especially for facilities not directly tied to
DON's warfighting mission, certain facilities degrade and the overall
facilities maintenance backlog increases. At current funding levels,
the overall condition of DON infrastructure will slowly, but steadily,
erode over the Future Years Defense Plan (FYDP). Although we are
proactively managing the risk we are taking in our shore
infrastructure, we acknowledge that this risk must eventually be
addressed.
base operating support (bos)
The fiscal year 2017 BOS request of $7.6 billion is essentially the
same as fiscal year 2016 levels. Similar to the risk taken in our
facility investments, the Department is accepting lower standards in
base operating support at our installations. Base operations at Navy
and Marine Corps installations are funded to the minimum acceptable
standards necessary to continue mission-essential services. We have
enforced low service levels for most installation functions
(administrative support, base vehicles, grounds maintenance, janitorial
and facility planning) in order to maintain our commitment to
warfighting operations, security, family support programs, and child
development. These measures, while not ideal, are absolutely necessary
in the current fiscal environment.
safety program
Our initiatives are improving the skills of our Safety
Professionals directly benefiting over 800,000 personnel (uniformed
personnel (Active and Reserve) and civilian) executing diverse, complex
missions across the globe. DON's safety program has expanded its global
online training resources to ensure the Naval Safety workforce is
educated and trained through more effective and modernized cost
efficient methods. We are acquiring commercial off-the-shelf
information technology tools to enhance our tireless fight to reach our
objective of zero mishaps. The Risk Management Information initiative
will comprise a streamlined mishap reporting system, data base
consolidation, state-of-the-art analytical innovations, and data
capabilities to improve our predictive abilities for safer sailors and
marines.
managing our footprint
Base Realignment and Closure (BRAC)
We appreciate the congressional support for additional fiscal year
2016 funds for environmental cleanup at BRAC properties. For fiscal
year 2017, the Department has planned to expend $154 million to
continue cleanup efforts, caretaker operations, and property disposal.
By the end of fiscal year 2015, we disposed of 94 percent (178,180
acres) of our excess property identified in previous BRAC rounds
through a variety of conveyance mechanisms. Of the remaining 6 percent
(11,674 acres), the majority is impacted by complex environmental
issues. Of the original 131 installations with excess property, Navy
only has 17 installations remaining with property to dispose.
Although many tough cleanup and disposal challenges remain from
prior BRAC rounds, we have fostered good working relationships with
regulatory agencies and local communities to tackle these complex
issues and provide creative solutions to support redevelopment
priorities.
Compatible Land Use
DON has an aggressive program to promote compatible land use
adjacent to our installations and ranges. This program helps Navy and
Marine Corps to operate and train in cooperation with surrounding
communities, while protecting important natural habitats and species.
We conduct Air Installation Compatible Use Zone Studies and Range Area
Compatible Use Zone Studies, and provide them to nearby communities for
their consideration in the exercise of their land management
responsibilities.
A key element of the program is Encroachment Partnering, which
involves cost- sharing partnerships with States, local governments, and
conservation organizations to acquire interests in real property
proximate to our installations and ranges. The Department is grateful
to Congress for providing funds for the DOD Readiness and Environmental
Protection Integration (REPI) Program. Since 2005, DON has acquired
restrictive easements on approximately 91,000 acres.
protecting our environment
The Department is committed to environmental compliance,
stewardship and responsible fiscal management that support mission
readiness and sustainability, investing over $1 billion across all
appropriations to achieve our statutory and stewardship goals. The
funding request for fiscal year 2017 is about 2.3 percent less than
enacted in fiscal year 2016, as shown in Figure 2:
FIGURE 2: DON ENVIRONMENTAL FUNDING BY PROGRAM
----------------------------------------------------------------------------------------------------------------
Fiscal year President's
2016 budget 2017 Delta ($
Category enacted ($ ($ millions) Delta (%)
millions) millions)
----------------------------------------------------------------------------------------------------------------
Conservation................................................ 86 93 7 8.1
Pollution Prevention........................................ 22 19 -3 -13.6
Compliance.................................................. 480 485 5 1.0
Technology.................................................. 36 37 1 2.8
Active Base Cleanup (ER,N).................................. 300 282 -18 -6.0
BRAC Environmental.......................................... 158 141 -17 -10.8
---------------------------------------------------
TOTAL................................................. 1,082 1,057 -25 -2.3
----------------------------------------------------------------------------------------------------------------
The Department continues to be a Federal leader in environmental
management by focusing resources on achieving specific environmental
goals, implementing efficiencies in our cleanup programs and regulatory
processes, proactively managing emerging environmental issues, and
integrating sound policies and lifecycle cost considerations into
weapon systems acquisition to achieve cleaner, safer, more energy-
efficient and affordable warfighting capabilities without sacrificing
operational capability.
In fiscal year 2017 we will complete environmental planning for
Navy's Records of Decision (RODs) for EA-18G Growler training at
Whidbey Island, Washington. As an example of our land stewardship
responsibilities, we will complete natural and cultural surveys to
support Marine Corps air and ground training at Twentynine Palms,
California. To maintain our environmentally responsible operations at
sea, we will continue to be leaders in ocean research by studying
marine mammal behavioral response to sound in water. We will also build
on our accomplishments this past fiscal year, which included finalizing
the environmental planning processes for the new Marine Corps Base on
Guam; completing a 5 year authorization for testing and training in the
Marianas Island Testing and Training area with National Marine
Fisheries Service; and successfully rearing 500 hatchlings and
releasing 35 mature tortoises with the University of California, Los
Angeles (UCLA) at the Marine Corps Twentynine Palms Desert Tortoise
Head Start Facility.
enhancing combat capabilities
The Department of the Navy's Energy Program has two central goals:
(1) enhancing Navy and Marine Corps combat capabilities, and (2)
advancing energy security afloat and ashore. Partnering with other
government agencies, academia and the private sector, we strive to meet
these goals with the same spirit of innovation that has marked our
history--new ideas delivering new capabilities in the face of new
threats.
Our naval forces offer us the capability to provide power and
presence --to deter potential conflicts, to keep conflicts from
escalating when they do happen, and to take the fight to our
adversaries when necessary. Presence means being in the right place,
not just at the right time, but all the time; and energy is key to
achieving that objective. Using energy more efficiently allows us to go
where we're needed, when we're needed, stay there longer, and deliver
more firepower when necessary.
Improving our efficiency and diversifying our energy sources also
saves lives. During the height of operations in Afghanistan, we were
losing one marine, killed or wounded, for every 50 convoys transporting
fuel into theater. That is far too high a price to pay. Reducing demand
at the tip of the spear through energy efficiency, behavior change and
new technologies takes fuel trucks off the road.
I'll mention just a couple of examples. The work that the Marine
Corps is doing to integrate solar power and software into autonomous
UAVs will allow them to take advantage of environmental conditions and
provide persistent surveillance for periods far in excess of our
current capabilities without refueling. They are also working on
technologies that harvest kinetic and other forms of energy into an
integrated power system capable of running a marine's radios and
electronic gear. These are real combat capabilities that will result in
increased lethality.
Navy is pursuing similar combat capabilities. In 2016 we will begin
installing hybrid electric drives in our destroyers, enabling our ships
to remain on station longer during low speed missions and extend time
between refueling. This is the same technology that is now onboard USS
MAKIN ISLAND and USS AMERICA, allowing those ships to stay on station
between refueling far longer than their predecessors.
Improving Energy Security and Resilience
Reliable and affordable electricity at our installations is
critical to mission effectiveness. Measures to reduce vulnerability and
to increase resiliency of the electrical system improve and protect
national security. The 2013 attack on key grid infrastructure in
California is a reminder of how fragile the commercial system can be.
The Department of the Navy recognizes this vulnerability and is working
to enhance our energy security.
Navy's Renewable Energy Program Office (REPO) has brought one
gigawatt (GW) of renewable energy into procurement. We expect those
renewable energy projects to yield hundreds of millions in projected
utility cost savings and even more important energy security benefits.
For example, last August we celebrated the procurement of 210 megawatts
(MW) of solar generation for 14 installations in California, with a
projected cost savings of $90 million over a 25-year term. At Naval
Submarine Base Kings Bay, Georgia Power Company is constructing a 42 MW
solar generation facility, which the base will have access to during
external grid outages. Marine Corps Logistics Base Albany will receive
access to a 44 MW on-base solar generation facility for use during grid
outages and a second feeder line from Georgia Power Company's grid.
DON's successful industry partnerships form a foundation for future
third party-financed energy resiliency projects in the form of
microgrids, battery storage, fuel cells, and distributed generation,
where these capabilities make sense. Industry has shown interest in
battery storage by proposing facilities located at two Navy
installations in California. The Arizona Power Service recently signed
an agreement to develop a microgrid at Marine Corps Air Station Yuma
and will provide the base unlimited access to onsite backup power,
eliminating the need for up to 41 diesel generators. These and future
energy security efforts using existing Title 10 authorities will help
make DON's installations more energy secure and resilient mission
platforms.
Strategic Investments in the Future
We endeavor to make investments that enhance our operational
flexibility. Our program to test and certify emerging alternative fuels
is critical for us to keep pace with developments in the private sector
and maintain interoperability with commercial supply chains. In
addition, the Defense Logistics Agency (DLA) Energy (through which Navy
buys operational fuels) recently awarded a contract to provide us with
an alternative fuel blend of F-76--the fuel we use to power our ships.
The contract was awarded at a cost competitive rate with traditional
fossil fuels and represents an important step toward diversifying our
fuel supply chains.
conclusion
Navy-Marine Corps Energy, Installations and Environment team will
continue to carefully and deliberately manage our portfolio to optimize
mission readiness, and improve quality of life. The Department's fiscal
year 2017 request makes needed investments in our infrastructure and
people, preserves access to training ranges, and promotes
environmentally prudent and safe actions, while ensuring energy
resiliency and security.
Thank you for the opportunity to testify before you today. I look
forward to working with Congress to deliver an innovative, resilient,
sustainable and secure shore infrastructure that enables mission
success for the United States Navy and Marine Corps, the most
formidable expeditionary fighting force in the world.
Senator Kirk. Thank you.
Let me ask, Katherine, you talked about strategic risks
with the Army. I will show you what I regard as the face of
strategic risk at Al Udeid Air Base, which we all call in the
military the Deid.
If you could take a look, these pictures were taken by a
guardsman, and they have gone somewhat viral on Facebook. I
want to make sure that our men and women in uniform are not
facing mold contamination like this.
When you talk about strategic risk, that is a very
bureaucratic way of saying that this is what you would stick
our soldier to live in.
Ms. Hammack. One of the challenges that I am sure Secretary
Ballentine will talk about is that the Air Force, just like the
Army, is not funded to 100 percent of our sustainment
requirements.
SUSTAINMENT FUNDING
The Navy just talked about being funded at around 73
percent. The Army is at 71 percent. I know that the Air Force
is facing challenges.
When we have known problems, we work to address them and
identify resources or reprioritize resources. It is a challenge
that all services are facing, to keep up with the environmental
requirements.
Senator Kirk. Thank you.
Department of the Air Force
STATEMENT OF HON. MIRANDA A.A. BALLENTINE, ASSISTANT
SECRETARY OF THE AIR FORCE, INSTALLATIONS,
ENVIRONMENT, AND ENERGY
Ms. Ballentine. Good morning, Mr. Chairman. Chairman Kirk,
Ranking Member Tester, esteemed members of the subcommittee, it
is a great pleasure and honor to represent America's airmen
before you today.
The bottom line is the Air Force installations are too big,
too old, and too expensive to operate. Twenty-four years of
continuous combat in a fiscal environment constrained by the
Budget Control Act have truly taken their toll.
In order to afford other Air Force priorities, like our
sister services, our total fiscal year President's budget 2017
facilities budget at $8.3 billion is down 4 percent from last
year, including MILCON, facilities sustainment, restoration and
modernization (FSRM), housing, BRAC, and environmental
programs.
The Air Force has prioritized MILCON over FSRM in fiscal
year 2017, requesting $1.8 billion in MILCON, that is a 14-
percent increase over last year, and $2.9 billion in FSRM,
which is down about 10 percent compared to last year.
I expect the backlog of degrading facility requirements to
grow.
Our MILCON program is three-tiered. First, MILCON to
support combatant commander requests is about 16 percent of the
MILCON budget. Second, 34 percent of the fiscal year 2017
MILCON program ensures that we have the infrastructure to
support new weapons systems beddown. Third, about 40 percent of
the fiscal year 2017 MILCON request allows us to chip away at
the very significant backlog of existing mission infrastructure
recapitalization needs.
In fiscal year 2017, we funded only about 30 projects of
the 500 top priority projects that our commanders submitted.
Let me briefly address Air Force energy programs. The Air
Force is focused on mission assurance through energy assurance.
We are taking a holistic enterprise approach to installation
energy with an emphasis on resilient cost-competitive, cleaner
power. The Air Force is also developing, acquiring, and
improving aviation energy technologies and behaviors to improve
the range and endurance of our weapons systems.
Finally, the Air Force needs another round of base
realignment and closure. We have about 30 percent excess
infrastructure capacity. Since the Gulf War, we have reduced
combat coded fighter squadrons from 134 to 55, a nearly 60-
percent reduction. Yet, all BRACs in that time period have only
reduced U.S. Air Force bases by 15 percent.
BRAC is not easy, and Congress has shared three very
specific concerns.
First, communities. Air Force communities are some of our
greatest partners. The Association of Defense Communities
recently asked community leaders what they thought about BRAC.
About 92 percent said that they believe the status quo of
hollowed-out bases, reduced force structure, and reduced
investments is worse for their communities than another round
of BRAC--92 percent.
Without BRAC, many communities will continue to suffer the
economic detriment of hollowed-out bases without the economic
support that BRAC legislation provides.
Second, cost. Congress rightly wants to ensure that the
savings of BRAC justify the costs, and, of course, we agree.
Simply put, the results of BRAC have been staggering.
Previous rounds of BRAC saved the Air Force $2.9 billion
each and every year, and the Air Force supports new BRAC
legislation that emphasizes recommendations that yield net
savings within 5 years.
Third, mission. Some have questioned the wisdom of
rightsizing infrastructure to our current force structure. I
want to assure you that we have no intent to close
infrastructure that may support future needs. Through five
previous rounds of BRAC and numerous force structure changes,
we have always left the room for future maneuvering, and we
always will.
We will continue to leverage community partnerships,
enhanced use leases, power purchase agreements, but we really
need BRAC authority to get at those significant savings.
In closing, the Air Force made hard strategic choices
during the formulation of this budget request in attempting to
strike that delicate balance between a ready force for today
and a modern force for tomorrow. We believe it is the right way
ahead.
Chairman Kirk, Ranking Member Tester, and esteemed members,
I request your support for the fiscal year 2017 MILCON request.
Thank you, and I look forward to your questions.
[The statement follows:]
Prepared Statement of Hon. Miranda A. A. Ballentine
introduction
Ready and resilient installations are a critical component of Air
Force operations. Unfortunately, 24 years of continuous combat, a
fiscal environment constrained by the Budget Control Act (BCA), and a
complex security environment have taken their toll on Air Force
infrastructure and base operations support investments. Furthermore,
the Air Force is currently maintaining installations that are too big,
too old and too expensive for current and future needs. This forces us
to spend scarce resources on excess infrastructure instead of
operational and readiness priorities.
Air Force installations are foundational platforms comprised of
both built and natural infrastructure. Our installations serve as the
backbone for Air Force enduring core missions delivering air, space and
cyberspace capabilities; sending a strategic message to both allies and
adversaries signaling commitment to our friends and intent to our foes;
foster partnership-building by stationing our airmen side-by-side with
our Coalition partners; and enable worldwide accessibility when our
international partners need our assistance and, when necessary, to
repel aggression. Taken together, these strategic imperatives require
us to provide efficiently operated, sustainable installations to enable
Air Force core missions.
The total Air Force fiscal year 2017 facilities budget request is
down 4 percent from fiscal year 2016 at $8.5 billion including Military
Construction (MILCON), Facility Sustainment, Restoration and
Modernization (FSRM), Housing, BRAC implementation and Environmental
programs. As in fiscal year 2016, the fiscal year 2017 President's
budget (PB) request for the Air Force attempts to strike the delicate
balance between a ready force today and a modern force for tomorrow
while also continuing its recovery from the impacts of sequestration
and adjusting to sustained budget reductions. The result is the Air
Force facilities budget accepts near term risk in the entire
infrastructure Maintenance and Repair portfolio of MILCON and
Sustainment, Restoration and Modernization accounts in order to protect
readiness and maintain credible capabilities in other core missions. In
doing so, it acknowledges this choice will have long term effects on
the overall health of infrastructure.
The Air Force's fiscal year 2017 President's budget includes $1.8
billion in Military Construction (MILCON) requirements, a 14 percent
increase over the fiscal year 2016 President's budget. This allows the
Air Force to replace degraded facilities that can no longer wait, while
still meeting Combatant Commander (COCOM) needs and new weapon systems
beddown requirements that must be accomplished now. This also allows us
to provide an equitable distribution of $333 million to the Guard and
Reserve components. This increase was funded by reductions in our
Sustainment, and Restoration and Modernization accounts for which we
request $2.9 billion, about 10 percent less than last year. We
recognize this reduction will expand a backlog of facility investment
requirements that already totals nearly $20 billion. To assure
continued focus on taking care of our airmen and their families, the
fiscal year 2017 President's budget also requests $274 million for
Military Family Housing operations and maintenance, and $61.4 million
for Military Family Housing Construction, $56.4 million for Base
Realignment and Closure and $842 million for Environmental programs.
military construction
The fiscal year 2017 MILCON program consists of three primary
tiers. The first is support to the COCOMs; the second is providing
facilities for the beddown of new weapons systems by their need dates;
and the third is replacing our most critical existing mission degraded
infrastructure on a worst-first basis.
COCOM Support
This year's President's budget request includes $293 million for
COCOM requirements; $35 million for Central Command (CENTCOM), $97
million for European Command (EUCOM), $29 million for Northern Command
(NORTHCOM), and $293 million for Pacific Command (PACOM). The Air Force
continues with phase three of the U.S. European Command Joint
Intelligence Analysis Center consolidation at Royal Air Force (RAF)
Croughton, United Kingdom, which also supports four other COCOMs.
Additionally, the Asia-Pacific Theater remains a focus area for the Air
Force where we will make a $109 million investment in fiscal year 2017
to ensure our ability to project power into areas which may challenge
our access and freedom to operate, and continue efforts to improve
resiliency. Guam remains one of the most vital and accessible locations
in the western Pacific. For the past 10 years, Joint Region Marianas
(JRM)-Andersen AFB, Guam has housed a continuous presence of our
Nation's premier air assets, and will continue to serve as the
strategic and operational center for military operations in support of
a potential spectrum of crises in the Pacific. Additionally, fiscal
year 2017 investments in the Pacific Theater include Kadena Air Base,
Japan; Royal Australian Air Force Base (RAAF) Darwin, Australia; and
the Commonwealth of Northern Marianas Islands (CNMI).
To further support PACOM's strategy, the Air Force is committed to
hardening critical structures, mitigating asset vulnerabilities,
increasing redundancy, fielding improved airfield damage repair kits
and upgrading degraded infrastructure as part of the Asia-Pacific
Resiliency program. In 2017, the Air Force plans to construct a
Satellite Communications Command, Control, Communications, Computers
and Intelligence facility at JRM-Andersen AFB, Guam to sustain Guam's
continued functionality. The Air Force also intends to recapitalize the
munitions structures in support of the largest munitions storage area
in the Air Force. Furthermore, the fiscal year 2017 budget invests in
the aircraft parking apron expansion and aircraft maintenance support
facility projects at RAAF Darwin supporting the Air Force's
participation in bilateral training exercises. The fiscal year 2017 PB
investment also includes a land acquisition in CNMI, to support the Air
Force's operational capability to execute weather diverts, accomplish
training exercises and respond to natural disasters. Our total fiscal
year 2017 COCOM support makes up 16 percent of the Air Force's MILCON
request.
New Mission Infrastructure
The fiscal year 2017 President's budget request includes $623
million of infrastructure investments to support the Air Force's
modernization programs, including the beddown of the F-35A, KC-46A,
Combat Rescue Helicopter (CRH) and the Presidential Aircraft
Recapitalization. The Air Force's ability to fully operationalize these
new aircraft depends not only on acquisition of the aircraft
themselves, but also on the construction of the aircraft's accompanying
hangars, maintenance facilities, training facilities, airfields and
fuel infrastructure.
The fiscal year 2017 PB includes $132.6 million for the beddown of
the KC-46A at five locations. This consists of $11.6 million at Altus
AFB, Oklahoma, the Formal Training Unit (FTU); $8.6 million at
McConnell AFB, Kansas, the first Main Operating Base (MOB 1); $1.5
million at Pease International Tradeport Air National Guard Base
(ANGB), New Hampshire, the second Main Operating Base (MOB 2); $17
million at Tinker AFB, Oklahoma, for KC-46A depot maintenance; and
$93.9 million at Seymour Johnson AFB, NC, the preferred alternative for
the third Main Operating Base (MOB 3).
This request also includes $340.8 million for the beddown of the F-
35A at five locations consisting of $10.6 million at Nellis AFB,
Nevada; $20 million at Luke AFB, Arizona; $10.1 million at Hill AFB,
Utah; $315.6 million at Eielson AFB, Alaska; and $4.5 million at
Burlington International Airport, Vermont. Additionally, the fiscal
year 2017 investment includes $7.3 million in support of the CRH
beddown at Kirtland AFB, New Mexico. As the Air Force continues its
efforts to modernize its fleet, we have moved forward to select
installations to beddown our newest airframes. In January of this year,
we announced the enterprise and criteria for the fourth KC-46A Main
Operation Base (MOB 4).
In preparation for the Presidential Aircraft Recapitalization
acquisition, the Air Force's 2017 budget request accounts for the
planning and design requirements essential to this future beddown and a
project to relocate the Joint Air Defense Operations Center Satellite
Site at Joint Base Andrews, Maryland.
Existing Mission Infrastructure Recapitalization
This year's President budget request also includes $723 million in
MILCON recapitalization projects addressing existing mission
infrastructure. Existing mission projects include requirements that
revitalize the existing facility plant and projects that address new
initiatives for capabilities already contained in the Air Force
inventory. The Air Force's fiscal year 2017 PB supports Nuclear
Enterprise priorities and includes three MILCON projects, totaling $41
million. With this budget submission, the Air Force intends to provide
a Missile Transfer Facility at F.E. Warren AFB, Wyoming, which
recapitalizes the current facility and continues to ensure proper
processing of missiles in support of the Missile and Alert Launch
Facilities at three sites. The fiscal year 2017 budget also includes a
Consolidated Communications Facility recapitalization project at
Barksdale AFB, Louisiana. Additionally, a new Missile Maintenance
Dispatch Facility at Malmstrom AFB, Montana will be built in support of
the UH-1 Helicopter and Tactical Response Force facilities beddown.
Together, these projects will consolidate scattered installation
functions and provide adequately sized and configured operating
platforms for the UH-1 recapitalization. Additionally, the fiscal year
2017 PB request includes three munitions storage projects to
accommodate the realignment and relocation of primary Standard Air
Munitions Package assets from McConnell Air Force Base, Kansas to Hill
Air Force Base, Utah.
The Air Force's fiscal year 2017 PB supports airfield
recapitalization requirements to include a project to construct an
updated, properly sized Air Traffic Control Tower at McConnell Air
Force Base, Kansas and a new aircraft maintenance hangar in support of
the Global Hawks at JRM-Andersen AFB, Guam. Additionally, the Air
Force's fiscal year 2017 PB supports force protection recapitalization
requirements to include a project that constructs a compliant main gate
complex at RAF Croughton, United Kingdom and new Combat Arms Training
Maintenance facilities at Buckley Air Force Base, Colorado, Yokota Air
Base, Japan, and Joint Base-Andrews, Maryland.
In total, our fiscal year 2017 request represents a balanced
approach ensuring critical infrastructure requirements to meet mission
needs and operational timelines.
facility sustainment, restoration and modernization
In fiscal year 2017, the Air Force requests $2.9 billion for
Facilities Sustainment, Restoration and Modernization (FSRM), which is
approximately 10 percent less than our fiscal year 2016 PB request and
funds sustainment to 77 percent of the OSD modeled requirement. The
Restoration and Modernization account is reduced by 34 percent in
fiscal year 2017 as compared to fiscal year 2016. The Air Force cut
this account in order to increase the MILCON program and therefore
reduce the greatest risk within the facility infrastructure portfolio
this year. Nonetheless, the Air Force's fiscal year 2017 FSRM request
attempts to keep ``good facilities good'' as the AF continues to focus
limited resources on ``mission critical, worst-first'' facilities
through application of asset management principles.
housing
During periods of fiscal turmoil, we must never lose sight of our
airmen and their families. Airmen are the source of Air Force air
power. Regardless of the location, the mission, or the weapon system,
our airmen provide the innovation, knowledge, skill, and determination
to fly, fight and win. There is no better way for us to demonstrate our
commitment to service members and their families than by providing
quality housing on our installations. The Air Force has privatized its
military family housing (MFH) at each of its stateside installations,
including Alaska and Hawaii. The Air Force has 32 projects at 63 bases,
with an end-state of 53,240 homes and we are now focused on long-term
oversight and accountability of the sustainment, operation and
management of this portfolio.
Concurrently, the Air Force continues to manage approximately
18,000 Government-owned family housing units at overseas installations.
Our $274 million fiscal year 2017 Family Housing Operations and
Maintenance (O&M) sustainment funds request allows us to sustain
adequate units and improve inadequate units, and our $61.4 million
request for Family Housing Construction funds improves 204 tower units
at Camp Foster, Okinawa and 12 units on Kadena Air Base. This request
will ensure we support the housing requirements of our airmen and their
families as well as the Joint Service members the Air Force supports
overseas.
Similarly, our focused investment strategy for dormitories enables
the Air Force to achieve the DOD goal of 90 percent adequate dormitory
rooms for permanent party unaccompanied airmen, while continuing to
support airmen in formal training facilities. The fiscal year 2017 PB
MILCON request includes two training dormitories at Fairchild AFB,
Washington and Joint Base San Antonio, Texas. With congressional
support, we will continue to ensure wise and strategic investment in
these quality of life areas to provide modern housing and dormitory
communities. More importantly, your continued support will take care of
our most valued asset--our airmen and their families.
air force community partnership program
In support of the Air Force priority to ``make every dollar
count'', the Air Force has put a concentrated effort to cultivate
partnerships between our installations and the local communities. The
Air Force Community Partnership program has been heralded by our Wing
Commanders and community leaders as an ideal forum for exploring win-
win partnerships. To date, there are 53 installations and communities
participating in the Air Force Community Partnership program. Since the
program's inception in 2013, we have completed more than 140
partnership agreements that have generated over $23 million in Air
Force benefits and $24 million in community benefits. Beyond the
tangible savings, the program creates an invaluable forum for fostering
relationships and promoting innovation. Installations and communities
now have the framework and tools needed to finalize many of the over
1,000 potential initiatives identified to date, such as shared medical/
EMT training, joint small arms ranges, and shared refuse management
services.
Without losing focus on fostering a partnership mentality across
the Air Force, we are now turning our attention to cultivate
initiatives that show significant promise of large returns-on-
investment (ROI) or have Air Force-wide application. In the future, the
Air Force Community Partnership program will continue to strengthen its
foundation by building upon concepts under development while
reallocating resources towards initiatives with large returns on
investment.
Of course, we need your help to pursue the initiative, which has,
by far, the largest return-on-investment--Base Realignment and Closure.
base realignment and closure (brac)
The Air Force has more infrastructure capacity than our missions of
today and tomorrow require. Our numbers of aircraft and personnel have
drawn down significantly since the Cold War. Since the last round of
BRAC in 2005, we have continued to drawdown our forces, but we have not
paired these drawdowns with comparable reductions in our
infrastructure. Since BRAC 2005, the Air Force has thousands fewer
personnel and hundreds fewer aircraft in our planned force structure,
yet we have not closed a single installation in the United States.
Ultimately, we are paying to retain more installations than we require,
and that money could be used to recapitalize and sustain our weapons
systems, on readiness training, and on investing in airmen quality of
life programs.
Congress has expressed concerns that BRAC may cost too much, is
often hard on communities, and may not adequately consider potential
future growth of our forces.
Regarding cost, Air Force experience shows that BRAC provides
significant savings. BRAC pays for itself. In each prior round of BRAC,
including BRAC 2005, the Air Force achieved net savings during the
implementation period. Couple that with the plain truth that the Air
Force simply cannot afford to maintain our current infrastructure
footprint, and our request for BRAC makes fundamental economic sense.
The Air Force has a $20 billion facility investment backlog. We
estimate (parametrically) that we currently have about 30 percent
excess infrastructure capacity when measured against our fiscal year
2019 force structure. Sustaining and maintaining this extra
infrastructure further strains our limited funds by forcing us to
spread them even thinner to support infrastructure that we simply do
not need. Without previous rounds of BRAC, the Air Force infrastructure
bill would be about $3 billion higher each year than it is now. BRAC
has been effective in reducing our infrastructure cost and we need
another round to truly align our infrastructure to our force structure.
We acknowledge there will be upfront costs, but those costs are the
down payment to significant savings in the future.
Regarding BRAC's impact on communities, we understand that Air
Force installations are key components of their communities. These
communities house not only our missions but also our families; our kids
go to the local schools; our airmen attend the local sporting events;
our families volunteer across the spectrum of activities--these
communities are our neighbors. With that in mind, the Association of
Defense Communities asked our neighbors what they thought about BRAC,
and 92 percent of community leaders \1\ believe BRAC is better for
their community than the status quo of hollowed bases, reduced manning
and minimal investment. As BRAC is, by nature, a consolidation effort,
some installations will be the recipients of new missions and these
communities will benefit from the economic boost that increased
installation activity will provide. Other installations will close;
however, it is only under BRAC that communities whose bases are closing
will receive direct economic support through redevelopment guidance and
financial assistance. Based on prior rounds of BRAC, communities in
which bases closed had lower unemployment rates and higher per capita
income growth than national averages.\2\ Additionally, the Air Force is
committed to partnering with DOD, Congress, and communities to consider
alternative approaches to the prolonged BRAC analysis and selection
process that puts an economic drag on all communities surrounding
military installations. In sum, without a BRAC, the Air Force will
continue to spread out our people and force structure, and as this
occurs many communities will continue to suffer the economic detriment
of hollowed out bases without the economic support that BRAC
legislation provides. This lose-lose scenario can only be reversed
through BRAC.
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\1\ From the June 2015 Association of Defense Communities National
Summit at which General Session audience members were asked: ``What
would be worse for defense communities?'' and chose from ``Status Quo''
or ``BRAC''.
\2\ From Government Accountability Office (GAO) studies GAO-05-138
and GAO-13-436.
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Finally, Congress has expressed concerns that a BRAC will enable
reductions in infrastructure that do not account for potential future
force structure growth. In asking for the authority to permanently
reduce our infrastructure footprint, the Air Force has considered both
its needs for today and its needs for the future. The Air Force has no
intent to close infrastructure that may support any realistically
achievable surge or contingency needs of the future. While we estimate
30 percent excess infrastructure capacity, the Air Force would build
specific reduction targets on future needs, and seek to reduce only
infrastructure that exceeds future scenarios. BRAC would be driven
first by a military value assessment grounded in operational needs, and
would not compromise future growth in force structure. In comparing
infrastructure capacity with force structure requirements going back to
the 1990s, the Air Force has never dipped below 20 percent excess
infrastructure capacity \3\ despite numerous force structure changes
and five previous rounds of BRAC. Thus, we believe we have the
opportunity to significantly reduce excess capacity while ensuring more
than adequate infrastructure to support any envisioned force structure.
Further, we are certain that BRAC provides the most effective means for
our infrastructure to achieve the right balance of effectiveness,
efficiency, and support to AF missions.
---------------------------------------------------------------------------
\3\ From DOD reports to Congress on BRAC and capacity in April 1998
and March 2004 in accordance with section 2912 of the Defense Base
Closure and Realignment Act of 1990.
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climate change
The 2010 and 2014 Quadrennial Defense Reviews (QDRs) recognized
that climate change will shape DOD's operating environment, roles, and
missions, and that we will need to adjust to the impacts of climate
change to our facilities, infrastructure and military capabilities. As
part of a larger DOD effort, the Air Force recently collected data from
over 1,500 sites regarding impacts from past severe weather events.
Surveyed sites not only included major installations, but also radar/
communications sites, housing annexes, training ranges, missile sites,
etc. Sixty percent of all sites reported some impact due to past
flooding, extreme temperatures, drought, wildfire, and wind. The single
most prevalent factor was drought which accounted for 42 percent of all
reported impacts, followed by non-storm surge flooding and wind with 19
percent each. Further, roughly a third of the 78 sites within 2
kilometers of the coast reported having experienced storm surge
flooding.
There are several pertinent examples of how climate change is
affecting our plans for current and future infrastructure operations.
The Air Force recently completed a study on the risks of coastal
erosion to remote Alaskan radar sites. Our radar stations are at risk
due to rapid, significant coastal erosion because the shore ice that
used to protect the coast from waves has melted. We continue to study
the rate of erosion, mitigate impacts and incorporate considerations in
future planning for these sites.
The DOD climate survey provided qualitative data that helped to
frame a more holistic understanding of the impacts of climate on
installations and operations. For the majority of reported severe
weather events, bases reported emergency preparedness actions and
procedures were successful in mitigating impacts on mission and
personnel. That being said, mitigation becomes more difficult and
cumulative impact to missions more crippling with increasing frequency
and/or magnitude of severe weather events. The Air Force continues to
integrate climate considerations into individual mission and
installation planning efforts to produce informed and resiliency-
focused decisions.
energy
The Air Force is the largest single consumer of energy in the
Federal Government. Air Force budgetary constraints have strained
investments in right-sizing, modernizing, and maintaining power
systems. As energy costs increase and budgets decrease, energy places
greater pressure on the constrained Air Force budget. From a cost
perspective, in fiscal year 2015, the Air Force spent approximately
$8.4 billion on fuel and electricity, with more than 86 percent going
towards aviation fuel. That $8.4 billion represented approximately 8
percent of the total Air Force budget; only 10 years ago, less than 4
percent of the budget went towards energy expenses. As we refocus our
efforts, the Air Force will take a multi-faceted energy investment
approach to enhance mission assurance.
mission assurance through energy assurance
The Air Force's ability to accomplish its mission--whether
executing today's fight or training for future fights--is dependent on
fuel and installation electricity. We must ensure reliable, resilient,
cost-competitive power for our airmen to fly, fight and win. To do so,
the Air Force has revectored its installation energy program from a
largely conservation oriented stance to one of energy resilience
through strategic agility in installation energy programs and projects.
The guiding tenet for this strategic agility is ``Mission Assurance
Through Energy Assurance.'' This new paradigm focuses on providing the
Air Force with the ability to complete its mission in light of
disruptions to electricity and fuel, as well as optimizing its energy
productivity through improvements in technology and process.
installation energy
Over the last several years, the Air Force has seen installations
lose power for significant periods of time as a result of ice storms,
hurricanes, fallen trees, and other forms of denial of service. So far,
the Air Force has been able to mitigate the most critical mission
impacts due to those power losses by exercising alternatives such as
moving missions in the case of weather events. There are several
critical missions, however, that cannot be moved and where even a
microsecond interruption in power puts Air Force mission capabilities
at risk. Even though the Air Force has reduced its energy intensity by
more than 23 percent since fiscal year 2003, we still rely almost
exclusively on expensive, non-networked diesel generators limited to
very specific systems to provide the only depth of resiliency beyond
that inherent in the electrical grid in our system. While that can be
sufficient for short outages, today's grid is increasingly threatened
by cyber incursions and physical attacks designed to disrupt power;
increasing frequency and severity of natural disasters; and
malfunctions from human error, aging equipment, and faulty
infrastructure; all with the potential for long-term outages. To that
end, we must enhance the energy resilience of Air Force installations
through the adoption of innovative technologies and business models.
Going forward, the Air Force will transition to a more
comprehensive approach to installation energy challenges, and it will
holistically optimize cost and provide resilient, cleaner sources of
energy by balancing the objectives of AF energy projects, including
energy efficiency, renewable energy, energy resilience, and other
energy projects. The core principles below will continue to
characterize Air Force installation energy projects, but with an
increased focus on meeting multiple objectives within single projects.
--Resilient: Every Air Force energy project should be designed
through the lens of enhancing energy resilience; the strategic
energy agility to maintain critical mission functions even
during unexpected disruptions. Air Force missions require agile
networks of platforms, communications equipment, satellites,
and other technology and equipment. The Air Force will secure
critical infrastructure and missions through a layered approach
to energy resilience, taking advantage of rapidly evolving
energy technologies to meet both home station and expeditionary
needs. The Air Force will buttress commercial power with on-
site electricity generation (preferably cleaner) paired with
smart distribution networks and cyber-secure control systems,
enabled to power critical infrastructure during grid
disruptions.
--Cost-competitive: Air Force installations and commands should
continue to ``make every dollar count'' when acquiring
advanced, cleaner energy projects, while also examining trade-
offs between lowest price and other priorities such as
resilience. The Air Force will continue to pursue energy
projects or transactions that will save money, leverage third-
party investment, and prioritize resources to projects that
also enhance energy resilience and reliability.
--Cleaner: Three global trends identified in ``America's Air Force: A
Call to the Future'' (rapidly evolving technologies, decreasing
availability of natural resources, and diverse operating
environments) work in favor of energy modernization. Renewable
and other distributed energy technologies are key components of
energy agility and assurance, especially when projects are on
site and capable of delivering continuous energy when the grid
is disrupted.
resilience
To help achieve Air Force energy resiliency goals, the Secretary
and the Chief of Staff of the Air Force established the Air Force
Office of Energy Assurance (AF-OEA) to serve as a central management
office dedicated to the development, implementation, and oversight of
privately-financed, large-scale renewable and alternative energy
projects. This office leverages partnerships with the Army's Office of
Energy Initiatives and Navy's Renewable Energy Program Office to
develop projects that contribute to strategic energy agility by
identifying and awarding third-party financed energy projects that
provide 10MW or greater and cleaner (but preferably renewable) power
that increases energy resiliency. These projects will provide
significant energy alternatives to assure Air Force missions in the
event of grid outages for short or long periods. The Air Force is
establishing this office with existing personnel resources and will not
include any new headquarters personnel; rather, it will co-locate AF-
OEA with the Army's Office of Energy Initiatives to share support and
processes, and move forward as a team. The AF-OEA will proactively team
with the Navy's Renewable Energy Program Office to optimize
opportunities that office identifies.
Finally, AF-OEA is charged to take a holistic, enterprise-level
approach to its energy assurance programs brought to bear on the Air
Force's mission assurance through an energy assurance approach. This
includes clean, cost-competitive, reliable and resilient energy through
the application of utilities privatization, power purchase agreements,
direct investment (e.g., energy conservation investment program), and
third-party financed (e.g., ESPCs, etc.) authorities Congress has
granted the Air Force. All available tools will be used.
cost competitive
Although current and projected energy prices are relatively low,
from a mission perspective, price volatility does not change mission
vulnerability. With mission assurance as our focus, the Air Force still
recognizes the need to reduce the cost of energy to allow our dollars
to support readiness and recapitalization requirements. The Air Force
directly invests in facility energy projects primarily using FSRM
funding based on Air Force priorities. Based on an historical average,
the Air Force anticipates approximately $223 million of its FSRM
funding going towards projects with energy benefits such as increased
resiliency and efficiency through modernized infrastructure.
While the Air Force has made considerable progress to avoid costs
through reduced energy consumption, there is more to do. The Air Force
is pursuing Energy Savings Performance Contracts (ESPC) and Utility
Energy Service Contracts (UESC) to fund energy conservation projects.
Since fiscal year 2012, the Air Force has awarded approximately $128
million across eight ESPCs and UESCs. In fiscal year 2016, the Air
Force expects to award up to $359 million in such contracts. To take
advantage of existing expertise, the Air Force has also partnered with
the Defense Logistics Agency (DLA) and the U.S. Army Corps of Engineers
(USACE) to expand its ability to identify and execute third-party
performance contracts.
clean energy
The Air Force recognizes both clean energy, and its more desirable
renewable subcomponent, are key elements to diversifying our energy
portfolio to achieve strategic energy agility. By the end of fiscal
year 2015, the Air Force had 311 renewable energy projects on 104
sites, either installed, in operation, or under construction, across a
wide variety of renewable energy sources, including wind, solar,
geothermal, and waste-to-energy projects. Cumulatively, the Air Force
has 104.3 megawatts of on-base renewable energy capacity. These
projects, which are typically owned and operated by private industry,
have increased energy production on Air Force installations by more
than 26 percent from fiscal year 2014 to fiscal year 2015. About 8
percent of the Air Force's total electrical energy consumption in
fiscal year 2015 came from a mixture of renewable on-base projects and
purchased commercial renewable supply. Unfortunately, little of this
energy can be directly consumed by our bases in the event of a grid
outage. As we evaluate both direct investment and third party
investment opportunities, the Air Force will exhibit preference for
renewable solutions where cost effective, followed by clean but not
renewable solutions, and ultimately by solutions that provide mission
assurance through energy assurance without a clean element.
the sweet spot
Each of the principles above are spectrums, and the Air Force does
not consider them ``either-or'' choices. The ``sweet spot'' projects
will have elements of all three core principals, but not every project
will demonstrate every characteristic. The Air Force will expect each
project to demonstrate a clear connection to at least two principles.
Projects that only achieve one principle will need strong mission
justification. In short, energy projects should move toward the ``sweet
spot.''
operational energy
Similar to the installation energy program, mission assurance is
the basis for the Air Force's operational energy program. Through
behavioral and technological advancements, the Air Force is optimizing
its capabilities in order to maximize combat readiness and reduce the
mission risks posed by our fuel supply challenges. With more than 5,000
aircraft in the Air Force fleet, and a demand for over two billion
gallons of jet fuel every year, improving how the aircraft and crew use
their fuel can generate significant increases in capabilities. To
address the risks posed by that demand, the Air Force has a goal to
improve its fleet aviation energy efficiency, defined as productivity
per gallon, by 10 percent by 2020. Since developing the goal in fiscal
year 2011, the Air Force has improved its aviation energy efficiency by
almost 6 percent through a combination of materiel solutions and
changes to policies and processes.
The Air Force is requesting $682.6 million in operational energy
related funding for fiscal year 2017. Included in this is $567.1
million to increase future warfighter capabilities, $4.5 million to
reduce the logistical risks to the mission from energy, and $111.0
million to improve current mission effectiveness.
materiel solutions
The Air Force faces a challenge when implementing materiel
solutions, as many of them require high upfront investments with long-
term paybacks. However, those paybacks often provide significant
returns in both fuel savings and reduced maintenance requirements. The
Air Force is in the midst of a propulsion upgrade program for the KC-
135 at a rate of 100 to 120 engines per year for the next 12 years, at
a cost of approximately $106 million per year. While this is primarily
a service-life extension effort, it provides a 1.5 percent reduction in
its fuel consumption rate per engine. Additionally, by improving
reliability and durability, these upgrades will provide lifetime fuel
and maintenance savings approaching $3 billion.
science and technology
Part of the Air Force's funding request for fiscal year 2017 is for
research, development, test and evaluation (RDT&E) opportunities with
operational energy benefits. One of the main operational energy related
projects is developing new adaptive engine technology, which provides
revolutionary advances in turbine engine performance. By incorporating
these advanced technologies, the Air Force will be demonstrating a
transformational engine that can operate with the power and performance
needed for a combat aircraft, while maintaining the higher fuel
efficiency of large aircraft. Based on the results of Air Force lab
experimentation, this engine will provide 25 percent greater fuel
efficiency, 30 percent greater range, 10 percent greater thrust, and
improved thermal management compared to current engines.
modeling and simulation
While the Air Force is enhancing its fleet through current and
future materiel solutions, it is also looking to improve how it manages
fuel usage for future conflicts. As part of the Joint Operational
Energy Modeling and Simulation (JOEMS) project, the Air Force is
leading a collaborative effort to examine how technology upgrades
impact operations in various scenarios through identification of fuel
usage requirements and logistical fuel supply challenges. By
incorporating energy considerations in wargames and other modeling and
simulation efforts, the Air Force can better understand the role fuel
and logistics can play in future operations. The way it manages and
consumes fuel can be a catalyst towards a successful mission, and the
Air Force is driving forward to ensure it maintains an energy advantage
against potential adversaries.
process changes
The Air Force is also actively fostering an energy-aware culture
that empowers airmen to take a smart approach to energy to better
complete their mission. Simple changes in how a pilot flies and trains
can affect aircraft fuel consumption. Through the Energy Analysis Task
Force (EATF), the Air Force studied how instructor pilots and simulator
instructors at Vance AFB in Oklahoma could incorporate fuel efficiency
concepts into pilot training to ensure new pilots understand how to
optimize fuel use. As part of a year-long trial, the EATF developed
four training techniques to reduce fuel consumption in the T-1A
Jayhawk, which were tested in T-1 simulators with a small group of
students. The energy efficiency techniques explored for integration
into the T-1 syllabus have the potential to save up to 6 percent in
fuel requirements on navigation training sortie profiles. One of these
techniques, called the Fuel Efficient Descent, involves teaching
student pilots to select the optimal point to begin their descent into
an airfield. When the students select the correct point to begin their
descent, they are able to reduce engine power to idle and descend using
minimum fuel. So far, the new technique has proven the potential to
reduce fuel usage by 35 percent during the descent phase of flight.
While this effort saves fuel today, it goes much further by
instilling an energy aware culture in those new pilots, which
proliferates into the Air Force's major weapons systems and will
potentially provide exponential savings. This type of savings can be
seen in the process changes executed at Altus AFB in Oklahoma, which
instituted scheduling and airspace utilization initiatives in 2013 that
are providing over $60 million in cost savings on an annual basis.
alternative aviation fuel
The Air Force is also committed to diversifying the types of energy
and securing the quantities necessary to perform its missions, both for
near-term benefits and long-term energy resiliency. The ability to use
alternative fuels in its aircraft provides the Air Force with enhanced
capabilities by increasing the types of fuels available for use. The
entire Air Force fleet has been certified to use two alternative
aviation fuel blends; one of these is generated from traditional
sources of energy and the other one is generated from bio-based
materials.
environmental stewardship
While the Air Force strives to prevent or minimize environmental
degradation from our training activities and operations, we recognize
that sustaining the world's most capable Air, Space, and Cyber Force
inevitably results in environmental impact. As a result, we view our
responsibility to protect human health and the environment as an
extraordinary duty. The Air Force is subject to the same environmental
statutes and regulations as any other organization in the country and
recognizes both its legal and inherent environmental responsibility.
The Air Force fiscal year 2017 PB request assures our programs comply
with applicable regulatory requirements but, more significantly, in a
manner that ensures the ready installations and resilient natural
infrastructure necessary to support the Air Force mission now and in
the future.
Environmental Program Funding Details
Within our environmental programs, the Air Force continues to
prioritize resources to ensure our defense activities fully comply with
legal obligations and our natural infrastructure remains resilient to
support our mission and our communities; restore sites impacted by Air
Force operations; and continuously improve. The fiscal year 2017 PB
seeks a total of $842 million for environmental programs. This is $20
million less than last year due to sustained progress in cleaning up
contaminated sites and efficiencies gained through centralized program
management. By centrally managing our environmental programs we can
continue to fund full compliance with all applicable laws, while
applying every precious dollar to our highest priorities first.
Further, our environmental programs are designed to provide
environmental stewardship to ensure the continued availability of the
natural infrastructure; the air, land and water necessary to provide
ready installations and ensure military readiness.
Environmental Quality
The Air Force's fiscal year 2017 PB request seeks $422.6 million in
Environmental Quality funding for environmental compliance,
environmental conservation, and pollution prevention. With this
request, the Air Force ensures a resilient natural infrastructure and
funds compliance with environmental laws in order to remain a good
steward of the environment. We have instituted a standardized and
centralized requirements development process that prioritizes our
environmental quality program in a manner that minimizes risk to airmen
and surrounding communities, the mission and the natural
infrastructure. This balanced approach ensures the Air Force has ready
installations with the continued availability of the natural
infrastructure it needs at its installations and ranges to train and
operate today and into the future.
The environmental compliance program focuses on regulatory
compliance for our air, water and land assets. Examples of compliance
efforts include more detailed air quality assessments when analyzing
environmental impacts from Air Force activities; protecting our
groundwater by improving management of our underground and aboveground
storage tanks; and properly disposing of wastes to avert contaminating
our natural infrastructure.
Efforts in pollution prevention include recycling used oil,
fluorescent lights and spent solvents, as well as sustaining our
hazardous materials pharmacies to manage our hazardous materials so
they don't turn into waste. We continue to make investments in
minimizing waste and risk to airmen through demonstrating and
validating new technology such as the robotic laser de-painting process
on aircraft.
The Air Force remains committed to a robust environmental
conservation program. Prior appropriations allowed the Air Force to
invest in conservation activities on our training ranges, providing
direct support to mission readiness. The conservation program in fiscal
year 2017 builds on past efforts to continue habitat and species
management for 96 threatened and endangered species on 45 Air Force
installations. This year's budget request also provides for continued
cooperation and collaboration with other agencies, like the U.S. Fish
and Wildlife Service, to provide effective natural resources management
and safeguard military lands from wildfire hazards through coordinated
planning and incident response, and the application of prescribed burn
techniques. The fiscal year 2017 budget will further the Air Force's
implementation of tribal relations policy to ensure that the unique
trust relationship the U.S. Government shares with tribes continues,
and to provide opportunities to communicate aspects of the Air Force's
mission that may affect tribes.
As trustee for more than 9 million acres of land including forests,
prairies, deserts, wetlands, and costal habitats, the Air Force is very
aware of the important role natural resources plays in maintaining our
mission capability. Sustained military readiness requires continued
access to this natural infrastructure for the purposes of realistic
training activities. The Air Force utilizes proactive ecosystem
management principles and conservation partnerships with other Federal
and State agencies to minimize or eliminate impacts on the training
mission. We are challenged by the fact that in many instances, our
installations have become the last bastion of habitat for certain
species due to the increased development outside the installation
boundary. The fiscal year 2017 PB request includes $53.4 million to
implement the Air Force's conservation strategy, which will ensure that
all aspects of natural resources management are successfully integrated
into the Air Force's mission.
The Air Force remains committed to good environmental stewardship,
ensuring compliance with legal requirements, mitigating mission
impacts, reducing risk to our natural infrastructure, and honing our
environmental management practices to ensure the sustainable management
of the resources we need to fly, fight, and win now and into the
future.
Environmental Restoration
The Air Force fiscal year 2017 PB request seeks $419 million in
Environmental Restoration funding for cleanup of current installations
and those closed during previous BRAC rounds. Our focus has been on
completing investigations and getting remedial actions in place, to
reduce risk to human health and the environment in a prioritized
manner. Ultimately, the Air Force seeks to make real property available
for mission use at our active installations, and to facilitate
community property transfers and reuse at our closed installations.
The Air Force has made progress over time in managing this complex
program area, with more than 13,500 restoration sites at our active and
closed installations (over 8,200 active and almost 5,300 BRAC). The Air
Force BRAC restoration program is on-track to achieve, at least, a
``response complete status'' at 90 percent of its Installation
Restoration Program (IRP) sites at closed installations by the end of
fiscal year 2018. Our active installation restoration sites are
currently projected to achieve the same 90 percent response complete
level by fiscal year 2020.
A new topic of focus is Emerging Contaminants (EC). ECs pose
significant risk management challenges to the Air Force environmental
program. Regulatory requests for environmental sampling and
implementation of EC response actions are on the rise.Characterizing
the extent of Air Force environmental releases of an emerging
contaminant, assessing the potential risk and impact to human health
and the environment, and initiating response actions and implementing
appropriate mitigation measures, drive unforeseen, chemical- and site-
specific environmental liabilities and program costs.
The Air Force response to releases of ECs from its facilities is a
deliberate, science-based and data-driven process that is focused on
protection of human health and the environment, conducted in accordance
with the Defense Environmental Restoration Program, and consistent with
the Comprehensive Environmental Response, Compensation, and Liability
Act (CERCLA).
The Air Force continues to work with regulators, city and State
officials and other stakeholders to develop the best solution to an
emerging problem. For example, for confirmed perfluorinated compounds
(PFC) releases, the Air Force is determining the extent of
contamination and taking steps to mitigate any validated human
exposures with interim actions until cleanup standards and effective
remedial technologies are available. When groundwater sampling results
indicate PFC levels exceed the EPA's provisional health advisory for
drinking water, the Air Force reduces PFC levels with filtration
technologies or provides an alternate drinking water source. When PFCs
are detectable, but below the provisional health advisory level, the
Air Force may conduct well monitoring to track PFC level changes and
determine if further action is needed.
While we cannot compromise on the protection of the public, our
airmen and civilian workforce and their families, neither can we
endlessly absorb the operational and financial risks of attempting to
work with a myriad of unregulated contaminants without some level of
certainty that the cost of controlling exposure will have a
commensurate public health and operational benefit.
conclusion
The Air Force made hard strategic choices during formulation of
this budget request. The Air Force attempted to strike the delicate
balance between a ready force for today with a modern force for
tomorrow while also recovering from the impacts of sequestration and
adjusting to budget reductions. Our fiscal year 2017 PB request
increases funding in MILCON to support COCOM and new weapon system
requirements, reduces Restoration and Modernization (R&M) and continues
to address the current mission backlog of deferred infrastructure
recapitalization from the fiscal year 2013 PB strategic pause.
Sequestration will halt this recovery. We also must continue the
dialogue on right-sizing our installations footprint for a smaller,
more capable force that sets the proper course for enabling the Defense
Strategy while addressing our most pressing national security issue--
our fiscal environment.
In spite of fiscal challenges, we remain committed to our
servicemembers and their families. Privatized housing at our stateside
installations and continued investment in Government housing at
overseas locations provide our families with modern homes that improve
their quality of life now and into the future. We also maintain our
responsibility to provide dormitory campuses that support the needs of
our unaccompanied servicemembers.
Finally, we continue to carefully scrutinize every dollar we spend.
Our commitment to continued efficiencies, a properly sized force
structure, and right-sized installations will enable us to ensure
maximum returns on the Nation's investment in her airmen, who provide
our trademark, highly valued air power capabilities for the Joint team.
Senator Kirk. Let me start with the questioning. I will
recognize myself.
Missile defense is one of my greatest priorities as chair
of this subcommittee. I would say that I am favorably looking
at the expeditionary deployment of Terminal High Altitude Area
Defense (THAAD) to Guam as a permanent funding item that we
would look at.
I would say to Mr. Potochney, could you tell me more about
the $155 million that you guys are planning for the long-range
discrimination radar in Clear, Alaska.
Mr. Potochney. Thank you, sir.
It is in our budget. It is important. We are strongly
behind it. We hope you all are. We want the money appropriated
this year, so that we can execute it holistically. I think it
is a key element of our approach to missile defense.
Senator Kirk. Mr. Tester.
Senator Tester. I will yield to Senator Udall.
Senator Udall. Okay, Thank you, Jon. I appreciate your
courtesy.
Thank you both, Chairman Kirk and Ranking Member Tester.
As we all know, the military's ability to meet future
global challenges is directly tied to its facilities. That is
what it uses to train, to test, to evaluate, and to carry out
its mission. So when I look at my home State of New Mexico, I
see an array of military installations that provide unique
capabilities to the Department of Defense and our mission on
the 21st century battlefield.
At Kirtland, we have the Air Force research lab and the
nuclear weapons center; at Cannon, the 27th Special Operations
group; Holloman has the high-speed test track; and the White
Sands Missile Range, otherwise known as WSMR, has 3,200 square
miles of unique and pristine testing and evaluation territory
that is used across DoD and other agencies.
WSMR is capable of testing next-generation technologies.
These will emerge from what DoD is calling the third offset,
the focus on technological innovation. Combined, all of New
Mexico's bases help build and sustain a 21st century military.
Ms. Hammack, I will direct this question to you. What
concerns me is that years of reduced MILCON budgets and
deferred maintenance have resulted in facilities and
infrastructure that may not be adequate or may not be advanced
enough to test and evaluate new technologies. For example, the
White Sands Missile Range sustainment, restoration, and
modernization budget is funded at only 69 percent. But WSMR has
repairs and maintenance backlogs of over $220 million.
Do you agree that the White Sands Missile Range offers
unmatched testing and evaluation capabilities that will help
develop the next generation weapons systems of third offsets
such as directed energy?
WSMR/SUSTAINMENT FUNDING
Ms. Hammack. The answer is yes. WSMR offers unmatched
testing capabilities, which is used by all services. You are
absolutely right. Sustainment funding is lagging. That is the
effect to sequestration.
So not only does WSMR have a backlog, but across the
Department of Defense, across the Army, in particular, we have
a backlog of sustainment that is well over $7 billion today.
So it is one of the significant risks that we are taking in
our installation budgets. We are doing our best to ensure,
though, that we do not fail the mission. So the money that we
have is focused on critical mission requirements and life,
health, safety.
Senator Udall. Could you discuss the Army's plan to address
WSMR's maintenance backlog and the budget shortfalls that face
us?
Ms. Hammack. Unfortunately, right now, we have no plan to
handle the maintenance backlog, because we don't have money to
handle the maintenance backlog. That is why we are addressing
the worst first.
But the challenge is, as we continue to be unfunded due to
budgeting constraints, the backlog will increase.
Unfortunately, that means that facilities will fail faster.
Right now, in the Army, 20 percent of our infrastructure
that is over 52,000 buildings are in poor or failing condition
due to the underfunding in our installation accounts.
Senator Udall. Mr. Potochney, as you know, a QF-4 unmanned
aerial vehicle crashed at White Sands National Monument over 2
years ago. That was in February 2014. But a 4-mile stretch of
the monument remains closed today due to serious concerns about
contamination in the soil, including access to two popular
family-friendly trails.
There have been some frustrating bureaucratic issues
preventing cleanup related to interagency funding, but we are
not aware of any specific legal obstacle to DoD funding this
cleanup.
Will the DoD pay for the cleanup? And can you commit to a
timeframe to get it done?
Mr. Potochney. Sir, thank you for that question.
I am frustrated as well, but we are on a path right now to
reconcile the bureaucratic delay that we have had.
The delay resulted from the fact that it was a Navy
mission, an Air Force plane, on a facility handled by the Army,
and the Army had the agreement with the Park Service for
cleanup. So we had to work through that.
I'm not happy at all with the fact that it has taken us
this long. I can assure you we are watching it very carefully
now, and I cannot commit to a timeline to clean it up, but I do
not think it will be too long, and it will be done
expeditiously.
The reason why I say I can't commit to a timeline is I
don't know how long it will take us to get the last contract in
place and how long that contractor will take. But we can take
that for the record, as soon as we have that plan in place.
[The information follows:]
information memorandum
Subject: Timeline for Army Cleanup at White Sands Missile Range (WSMR)
Cleanup: Contract award June 2016. Expected completion mid-January
2017, with anticipated regulatory approval by July 2017.
--WSMR Commanding General and White Sands National Monument (WSNM)
Superintendent agree that the existing 2-year old site
assessment requires a refresh and re-analysis of the crash
site.
--The crash site will be re-assessed to determine extent of
contamination
--Once the new assessment is completed, personnel will excavate and
properly dispose of the contaminated soil from the areas
showing the highest concentration of jet fuel
--Personnel will analyze soil samples to verify cleanup levels
--The Army plans to complete the cleanup of the White Sands Missile
Range (WSMR) site by mid-January 2017, with anticipated
regulatory approval by July 2017
--Completion of cleanup could require additional time if the
contamination proves to be more extensive or has
potentially spread
--Major Milestones are as follows:
--Contract award--June 2016
--Work Plan and Site Assessment complete--mid-October 2016
--Cleanup Action complete--mid-January 2017
--Regulatory review & approval--complete July 2017
--WSMR has the estimated $500,000 funds on hand to contract for
remediation and will follow the existing Memorandum of
Understanding (MOU) to be subsequently reimbursed by the Navy.
--U.S. Army Corps of Engineers (Tulsa) will award the remediation
contract and use a qualified contractor
Senator Udall. Yes. That's good to hear, and I think it's
important we move forward, so we make sure that we have a good,
long-term relationship between the Air Force and the White
Sand's National Monument, which worked very closely together to
achieve, as you know, a lot of these national security
objectives.
Mr. Potochney. Yes, sir. And if I could just add one thing?
I'm using it as an illustrative test case, if you will, of how
we can do a better job at an interagency decisionmaking, and we
will do that.
Senator Udall. Thank you.
Mr. Potochney. Thank you.
Senator Kirk. Senator Collins.
Senator Collins. Thank you very much, Mr. Chairman.
Secretary Iselin, first, let me tell you that I'm very
pleased to see that the President's budget request includes
funding for three important projects at the Portsmouth Naval
Shipyard in Kittery, Maine.
This shipyard is considered the gold standard. It's the
most productive of our four public shipyards. I can say that
not only because it's true but there are no other members here
representing the other three who could contradict that
statement. But it is, indeed, the case, and we're very proud of
that.
I particularly am pleased to see that funding of $27
million has been requested to replace the medical and dental
clinic. That facility is over 100 years old, and it does not
meet standards for safety, for accessibility. And it does not
allow for a smooth and efficient delivery of services, as you
might imagine, given the age of the building.
So I just want to go on record in support of those three
projects, and thank you for including them and recognizing
their importance.
I do want to bring up a longer range issue that is of
concern to me. We all know that fleet readiness is a key
component of our Navy's capability to project power and deploy
assets. Our Nation's four public shipyards ensure this
readiness as they restore, repair, and modernize ships and
submarines at dry docks.
According to NAVSEA and the Navy Shore Mission Integration
Group, however, naval shipyard dry dock capacity is inadequate
to service future fleet maintenance needs. And my concern is,
without this capacity, the readiness of our ships and
submarines is placed at risk, and we will be left vulnerable,
particularly as we look at what China and Russia are doing.
So to respond to these threats, we must invest in dry
docks, a critical component of fleet maintenance.
The necessary levels of investment in those dry docks is
currently estimated at $2 billion divided among the four public
naval shipyards.
Can you give us some concept of how the Navy plans to fund
these future requirements and ensure that dry docks are
available and properly maintained, and able to keep our fleet
operationally ready and strong?
Mr. Iselin. Yes, ma'am.
First, thanks for your compliment on supporting the funding
for those facilities at Portsmouth. I was stationed there over
30 years ago and have fondness in my heart. I had a broken
thumb set at that medical facility, and it was old then and
it's older now. So we're happy to be able to make those
investments.
As to your broader question about dry docks and really
shipyard facilities writ large, we recognize those are critical
assets.
There's a finite number of those around the Navy, and we
pay close attention in our fiscal year 2017 request. Although
it's not overtly visible to you, we have over $70 million
targeted for repair projects, six repair projects at the dry
docks, some at each of those four public shipyards.
To the bigger question about how we are going to get after
the $2 billion backlog, know that we prioritize shipyards and
their maintenance.
During the last couple of years, particularly during the
days when we were at furlough, the Navy leaders recognized very
directly the importance of ship repair capability. We had
weight handlers who operated cranes at a shipyard unable to
come to work because of a furlough, and we ended up with four
star senior leaders directly managing people's days on and days
off to make sure that we met the ship repair capability,
because that has direct implications on operational readiness.
So we know where our challenges are. As I mentioned, in my
opening remarks, we have a very good system of understanding
what our critical facilities are. Dry docks clearly are at the
top of the list, and we know the condition of them. And the
challenge will be to prioritize those facilities along with
everything else as we spend the dollars that we have.
I mentioned senior leader's awareness. I've been involved
in this business for a long time, and it's an unprecedented
level of attention by the Secretary of the Navy, the Chief of
Naval Operations (CNO), and the Commandant on the challenges
that we're describing here today. So I feel comfortable that
the senior leaders are paying close attention on where to make
the best investments that we can.
Senator Collins. Thank you very much for that thorough
response, and please know that you are welcome back to Kittery,
to the shipyard, at any time.
Mr. Iselin. Yes, I was up there last year, and I was really
pleased to see how far it's come over the last couple of
decades, and the pride that the workforce has in what they do.
Senator Collins. That pride is really evident, and I'm very
proud of the workers there. Thank you so much.
Senator Kirk. Senator Murphy.
Senator Murphy. Thank you very much, Mr. Chairman.
Welcome, to all of our witnesses.
Mr. Iselin, I'm going to stay with you. I have the same
pride that Senator Collins does in representing the Navy's
first submarine base in New London, Connecticut, and I can say
the finest base, so long as Senator Schatz is not here.
And Senator Wicker and I got the real honor about 2
weekends ago to actually spend 24 hours on board the USS
Hartford as it conducted operations in and around the Arctic
Circle. And of course, as always, I was incredibly impressed
with their skill and professionalism.
But as you are aware, we have committed through the
Appropriations Committee process along with the Navy to
continuing the two Virginia-class submarines, build a year
while simultaneously integrating the new Virginia payload
module into the Block V submarines starting in 2019. And as you
also know, these new Virginia-class submarines are going to be
a lot bigger than the existing Virginia-classes and the Los
Angeles class submarines.
And so I wanted to ask you about how our military
construction budget is going to keep pace with this increase in
the number and the size of Virginia-class submarines.
Specifically, in New London, Pier 32 needs to be upgraded
in order to meet this new requirement starting in 2019. And I'm
hoping that you can maybe speak even more generally to the
necessary upgrades that are being planned and the needed
military construction projects that are in the budget over the
next few years to make sure that we have the capacity to deal
with this increase in both volume of production but also size
of the submarines.
Mr. Iselin. Yes, sir. Thanks for your question.
And I was fortunate to make a visit up to Sub Base New
London last year as well and got a great tour from the
installation commander and the staff there who are responsible
to look after those very situations.
And I agree with you. We have challenges with the condition
of that pier, and that will factor into our future investment
plans. Certainly, a pier to support nuclear submarines is high-
priority item.
And as it relates to the Virginia payload module and the
changes in the size and the nature of submarines as a result,
that will factor in. The installation team has a long-range
plan to make adjustments to the infrastructure to accept that
new platform, and that will factor into future planning
initiatives.
Senator Murphy. We look forward to working with you to make
sure that that plan stays on track.
The second question for you as well, I certainly understand
that you're going to support the broader request from the
Department for a BRAC. But I wanted to ask you as to the Navy's
very specific disposition. The immediate past CNO Admiral
Greenert said in earlier testimony very clearly that the Navy
didn't believe that it had a need for base closures or for a
BRAC process.
He said, ``I'm very satisfied with our lay down of bases.
People ask me do you see a great need for BRAC, I say, no, I
don't.''
And so I understand you'd be supporting the broader
request, but has the Navy's disposition changed in terms of its
need for a base closure process?
Mr. Iselin. Thanks for that question and you assume
correctly. We do support the Department's request for BRAC. I
would say, on a high level, we have much less excess
infrastructure capacity than the Army or the Air Force.
We played very aggressively in prior rounds of BRAC to try
to get to the right size. We've had the benefit, unlike the
other services, of having less fluctuation in our force
structure over time, including the projected force structure.
And so we look forward to completing the required capacity
analysis, and if a BRAC is authorized, we'll, of course,
participate in that process. But I think our challenge is less
severe than the Army or the Air Force.
Senator Murphy. Okay.
Thank you very much, Mr. Chairman.
Senator Kirk. Senator Boozman.
Senator Boozman. Thank you, Mr. Chairman.
Ms. Hammack, tell us about the excess infrastructure in the
Army.
Ms. Hammack. Thank you for that question.
Currently, the Army has approximately 18 percent excess
infrastructure. As force structure continues to decline, we
will have 21 percent excess infrastructure when we reach a
total force of 980,000. That amounts to over 170 million square
feet of unutilized or underutilized facilities.
As we've reduced our force, quite often, we see buildings
that are partially occupied. One of the things a BRAC offers us
is the ability to consolidate into our best facilities and
consolidate missions, and that's why we are asking for BRAC
authority.
The previous rounds have consolidated about 5 percent of
our infrastructure, and we anticipate that this next round of
BRAC would do the same: Consolidate about 5 percent of our
existing 21-percent excess, so that we would retain some
capacity for surge or other unanticipated requirements.
Senator Boozman. For the panel, if Congress were to grant
you the ability to go forward with BRAC, can you tell us what
you learned from the last BRAC that we did, some of the things
that we should have done better?
Mr. Potochney. I'll start, if I could.
Senator Boozman. Yes, sir, if you would.
Mr. Potochney. Congress was rightly concerned about the
cost growth from the last round. We had anticipated around $22
billion in cost, and we came in at $35 billion. Some of that
was attributable to fact-of-life things. We had a Katrina
effect that put our construction materials through the roof.
Environmental cleanup is an issue that we have to handle
carefully in BRAC, those kinds of things.
But, we, frankly, used the last BRAC round as a
recapitalization engine and as a transformation tool, so that
we weren't just skinning down excess capacity in place. We were
actually looking more broadly. And that's expensive, but it
does position us for the future.
What we're saying to you all now is that we're looking at
the next round being an excess capacity round to reduce our
costs. So that is, if you will, to use your words, a lesson
that we've learned.
I would argue, though, that the transformation that was
accomplished in the last round was absolutely worthwhile, at
least in my judgment and others as well. But as far as a tool
to reduce our infrastructure and save money directly, excess
capacity is the way to go, and that's what we're looking at
now.
Senator Boozman. Ms. Hammack.
Ms. Hammack. Let me comment on that.
One of the things that the Army learned is that the Reserve
component has an opportunity to participate in BRAC, which they
did for the first time in 2005: They closed 387 facilities,
consolidating into 125 new readiness centers, which were shared
by Guard, Reserve, and, quite often, other Federal agencies
like the Fish and Wildlife Service or Department of the
Interior Bureau of Land Management.
So the National Guard found that it increased their
capabilities and reduced their costs, and, just like the Active
Duty and the industrial base, found that there are significant
opportunities for efficiencies to save money and prepare us for
the future.
Senator Boozman. Very good.
AIR FORCE--2005 BRAC ROUND
Ms. Ballentine. I would like to add that for the Air Force
in the 2005 BRAC round, it really was a good money-saving
exercise, as well as a good transformational exercise. The 2005
round cost the Air Force about $3.7 billion, and we're saving
$1 billion a year. That's a pretty good return from the
business perspective.
EUROPEAN INFRASTRUCTURE CONSOLIDATION
I would also encourage all of us to look at our recent
European infrastructure consolidation as a strong process. We
would seek to replicate many of the elements of that process in
the next round.
It was very much focused on savings for the Air Force.
We're doing nine actions in Europe, and we'll save considerable
money with zero loss of operational capability. It really was
designed to find ways to be as or more operationally capable
from lower cost, fewer installations.
So I would encourage us to look at both, the most recent as
well as prior, to get the best lessons learned.
Thank you for the question, sir.
Senator Boozman. Thank you.
Mr. Iselin. Sir, I don't have anything additional to add. I
think they've covered it.
Senator Boozman. Good. Well, that worked out perfectly or
the chairman would yell at me, because my time is up. So thank
you all very much.
Thank you, Mr. Chairman.
Senator Kirk. Senator Murkowski.
Senator Murkowski. Thank you, Chairman. I appreciate you
letting me jump in here.
I would like to start my questions and direct them to you,
Assistant Secretary Ballentine.
As you know, we had a pretty good start of the week in
Alaska, particularly in Fairbanks, with the announcement of the
record of decision (ROD) assigning the two squadrons of F-35
aircraft to Eielson Air Force Base. With a signature of that
ROD, we are really very excited for a host of different
reasons. This is the first F-35A beddown in the crucial Pacific
area of responsibility (AOR).
The administration has requested $295.6 million in fiscal
year 2017 to construct seven different projects there at
Eielson.
Can you please speak to the importance of this week's
decision and explain why it is essential that this subcommittee
fully appropriate the administration's request in the 2017 bill
and how any possible delay in appropriations could adversely
affect the beddown of these two squadrons there at Eielson?
F-35A BEDDOWN--2017 MILCON PROGRAM
Ms. Ballentine. Thank you, Senator.
This is a very short, straightforward answer. It's
absolutely critical that the full fiscal year 2017 MILCON
program that we submitted is funded this year.
With the current timing of the beddown of the first
aircraft for both Squadron 1 and Squadron 2, if we do not fully
fund this MILCON program, we will be late to need.
And in an environment like Alaska with very harsh winter
conditions, it's very difficult for us to create mitigations if
we don't have the proper facilities.
In fact, as you also know, we announced a swap of timing
for the first squadron with Burlington, Vermont, which in many
ways helps to solve some problems that we had previously where
we would have been late to need.
So it's absolutely critical with this current timing that
we get all of this program funded for both squadrons.
Senator Murkowski. And also, we had discussed the reality
that we have a limited construction season in Alaska. You just
can't be doing all this outside work 365 days out of the year.
So the timing on this is critical.
Ms. Ballentine. Yes, ma'am.
Senator Murkowski. Thank you. I appreciate that and would
certainly encourage the subcommittee to take very seriously the
Assistant Secretary's words here.
Finally, to Assistant Secretary Hammack, this relates to
the $47 million for a hangar to house the Gray Eagle unmanned
aerial vehicles at Fort Wainwright. Anything you would like to
say in support of this request? And, again, in terms of the
timing, a very important asset there in the interior as well.
Ms. Hammack. Absolutely, and thank you for that question.
I echo Secretary Ballentine. It's critical that we get the
money. The vehicles, some are already there in adequate
facilities. We need the money so that we can progress within
the planned timeframe so that we have the ability to both work
on the equipment, maintain, repair, and do the appropriate
training that Alaska affords to our soldiers.
Senator Murkowski. Thank you. I appreciate that.
And I understand, Mr. Chairman, that you had already
directed a question regarding the Long-Range Discrimination
Radar, the significance of that, why it's essential that we
provide for the administration's request on that. So I
appreciate that, and I also appreciate your commitment to that
at Clear.
My final comment would be not directed to any of you
necessarily at the table, but I know that General Halverson is
with us today, and I know that you have been invited to join us
up in Fairbanks perhaps for the military appreciation event
coming soon, and I know that that is something that is under
consideration. So I saw you in the audience there and just take
the time to do that.
Thank you all for your commitment to ensuring that as we
advance these priorities around the Nation, that we do so in a
timely and efficient manner.
Thank you, Mr. Chairman.
Senator Kirk. Senator Baldwin.
Senator Baldwin. Thank you, Mr. Chairman.
High-quality installations like the Wisconsin Air National
Guard Truax Field, which is home to the 115th Fighter Wing,
rely on adequate capital investments to ensure readiness and
support mission success.
The 115th is under consideration to be one of the new
National Guard homes of the F-35 with aircraft fielding in
2022. I expect it to be a very strong competitor for a number
of strategic, geographic, and economic reasons.
So I'm pleased that this year's budget includes a fiscal
year 2019 project at Truax to improve the condition of the
facilities used by the 115th medical group. It's a subunit,
obviously, of the 115th. This project is the number one
priority of the Wisconsin National Guard and will support the
training of medical professionals assigned to that unit, the
medical readiness evaluation of military members assigned, and
a domestic operations capability.
Secretary Ballentine, projects in the Future Year Defense
Program (FYDP) sometimes are moved forward and sometimes are
pushed back, as the Department builds it budget request.
Considering that by the time this fiscal year 2019 project
breaks ground, there will not have been an Air Force MILCON
project in Wisconsin for a whole decade, I strongly believe
that this project must not be delayed.
Can I have your commitment on that?
Ms. Ballentine. Thank you, ma'am.
We do our best to prioritize our mission-critical, worst-
first facilities for our existing facilities. Our existing
facilities MILCON budgets are highly, highly strained. Of the
500 top priorities submitted by our major command commanders
this year, we only were able to fund 30.
So it's a very difficult budget environment for those
existing facilities, and I think we've heard that a lot today.
So we certainly do hope that everything that's in the
current program will stay in the program, and we will continue
to prioritize mission critical worst-first.
I also thought I would just touch on the timing for the Ops
5, 6, and 7 F-35 beddown strategic basing process, which you
mentioned. We will be announcing later this month the
enterprise definition as well as the criteria, and then we'll
go into the scoring period of time.
MILCON BACKLOG
This summer, we hope to approve the candidates and then
begin site surveys and hope to be able to announce a preferred
and reasonable alternative this fall.
Senator Baldwin. Thank you.
Secretary Hammack, your testimony notes that the fiscal
year 2017 request for the Army National Guard is a small step
toward addressing the Guard's facility challenges, and I
appreciate your candid assessment of the request and share your
concerns with the critical facility shortfalls in the Guard's
readiness center portfolio.
The Wisconsin Army National Guard has a 40-percent facility
shortfall that directly and significantly affects readiness,
recruiting, and equipment management.
My question to you is how can we take bigger steps toward
fixing the problem, particularly in this tight budget
environment? And specifically, how can the Army support the
funding levels called for by the readiness center
transformation master plan?
Ms. Hammack. I would love to say that there is a solution
but the best solution is to lift sequestration. With the budget
constraints we're facing, we're having to balance readiness and
the missions that are asked of the Army against installations.
When we look at manning the Army, training the Army, and
equipping the Army, there is very little left for supporting
installations and supporting readiness centers.
So we do our best with the limited funding we have, but we
have a tremendous backlog in military construction requests,
just like the Air Force. We have a tremendous backlog in
maintenance requirements, restoration, and modernization
requirements. It amounts into the tens of billions of dollars
currently, and is only going to grow with time.
So we are taking significant risk in installations and
creating a bill for the future by the underfunding that we are
forced to live with in this restricted budget environment.
Senator Baldwin. I know my time is about to run out. Let me
just note that as a total force training center, Wisconsin's
Fort McCoy plays a crucial role in the training and
mobilization of our Armed Forces, ensuring that service members
are fully prepared to respond to any contingency. And as such,
it's critical that the Army continues to invest in Fort McCoy,
maintaining the installation's ability to support the readiness
and quality of life of our soldiers and their families.
I'm pleased that the budget does include three projects for
Wisconsin's Fort McCoy, including a fiscal year 2017 project to
construct a new dining facility to support mobilizing and
training soldiers. I will ask you to submit any extra comments
for the record as I run out of time.
FORT MCCOY
But, Secretary Hammack, if you can expound in the future
about how this budget reflects a strong recognition by the Army
that Fort McCoy is essential, not only to the Reserves, but to
the total force.
And I thank the chairman.
Ms. Hammack. Just a brief reply on that, Senator Baldwin.
Fort McCoy is a strategic training asset for the total force.
When I was last there, we had Active Duty from Fort Drum
training with Guard and Reserve together, training in a
realistic environment, and training the way we fight, and that
is a great thing. The three projects that were included in our
fiscal year 2017 budget request, together with the 17 projects
(totaling $223 million) provided over the last 10 years, are a
clear testament to the Army's recognition of Fort McCoy as an
essential training platform for the total force.
Senator Kirk. Senator Cassidy.
Senator Cassidy. Thank you, Mr. Chair.
Assistant Secretary Ballentine, we spoke yesterday. Thank
you for coming by. Reflecting on our conversation, you
mentioned the need to buy back some force, that the force
reductions have been such that now you all need to bring folks
back in. Knowing that you're in a rock and a hard place,
nonetheless, I'll emphasize the quality-of-life issues that you
said in this budget are somewhat deemphasized. If you're going
to buy back folks in, it just seems as if they would want to
have daycare or such like that, if they're going to rejoin,
knowing that you know that, but just to make that point.
Ms. Hammack, knowing, again, that you all are having to
prioritize that which is important, and as you might guess,
being from Louisiana, I'm very sensitive to the Fort Polk
issue, that combat training center. It's fair to say that as
you all prioritize, you'll recognize the importance of combat
training centers and the need to modernize the joint readiness
training centers such as at Fort Polk?
Ms. Hammack. Yes, sir, and we do prioritize. Our highest
value goes to training land, airspace, and testing ranges, and
Fort Polk is a great training environment. But we do have a
backlog in construction, and so that's one of the challenges
finding enough money to suit all of our requirements.
We are going to be investing there, but it is out in the
future years.
Senator Cassidy. Combat readiness though is almost by
definition--it seems to be the number one priority of the Army,
to be ready for combat. So that's why I just advocate, not just
as a fellow from Louisiana, but as someone who wants to see our
troops ready, less likely to be harmed, more likely to affect
their mission, to have that at the highest priority.
You also, in your testimony, speak at length regarding the
Army's green energy initiative. And you suggest but don't
outright state that the investment has paid for itself. Has it?
Because it seems as if it's one thing to say that the cost of
electricity from a renewable is cheaper than that which you can
buy off the grid, but it's another to say that once you factor
in the cost of the installation of the infrastructure and the
maintenance, that it is still cost effective. So, thoughts?
RENEWABLE ENERGY
Ms. Hammack. Absolutely, Senator.
That is why we're not investing Army money in it. The
private sector is designing, building, owning, operating, and
then delivering us the energy at a lower cost than would
otherwise be available.
Senator Cassidy. What I find interesting though is that
you're accomplishing that which others have not, unless they
are using the other Federal subsidies that go with green
energy. Am I to presume that this energy being received is
taking advantage of Federal tax credits? Because otherwise,
green energy typically is not cheaper all in than is
conventional, if you will, electricity.
Ms. Hammack. Many of them are taking advantage of Federal
tax credits, but we have seen the cost of renewable energy
decrease whether it's wind, solar, or biomass, it has decreased
in all areas. That's why it's a good business decision to have
the private sector invest money, because they have to be able
to make money out of it, yet deliver us energy at or lower than
current energy costs.
Senator Cassidy. I see that. But at all-in cost to the
Federal taxpayer. We also have to consider the cost of the
production tax credits or whatever. So granted, it offloads off
you, but it's still on the Federal budget.
I just say that not to accuse or to challenge, but just to
understand. In a sense, this is a stackable payment.
Okay. I get that.
I yield back. Thank you.
Senator Kirk. Senator Schatz.
Senator Schatz. Thank you, Mr. Chairman.
With the exception of our longstanding commitments to the
Republic of Korea and Japan, we've largely had a ``places, not
bases'' defense posture in the Asia Pacific. But our footprint
is changing, and we have marines in Darwin for half of the year
as part of a broader realignment in the region. We also have a
new, enhanced defense cooperation agreement with the
Philippines where we look to bring rotational forces.
And while this doesn't mean new bases, it does mean new
infrastructure to store equipment and support training.
So my question for Secretaries Hammack, Iselin, and
Ballentine is, how do you see the overseas MILCON evolving in
light of increasing requirements and increasing partnerships in
the Asia Pacific region, in addition to what's happening in
Korea and Japan?
COST SHARING
And we'll start with Secretary Hammack.
Ms. Hammack. Thank you, Senator Schatz, for that question.
One of the things we are evaluating is working very closely
with our allies and partners over there to leverage their
resources and their capabilities and their bases for storage,
so that we can reduce the cost of partnership and joint
training exercises. A lot of that is under development right
now.
Senator Schatz. Are you talking about actual cost-sharing
or are you talking about sort of leveraging assets that they
already have in terms of physical plant and land?
Ms. Hammack. All of the above.
Senator Schatz. Okay.
Ms. Hammack. That's the Army strategy.
Mr. Iselin. Senator, thank you for that question.
I can't speak specifically to the Philippines because I'm
not yet read up on those issues. I know that we've recently had
an agreement to go to five locations there. I think the
predominance were either Air Force or Army support.
But in Darwin, there's ongoing intergovernmental
discussions about cost-share arrangements, and those aren't
completed yet. So until those are done, I can't comment on
specifics.
Certainly, it's in our interests to ensure that there's a
fair cost-sharing agreement in place, such that we're not
carrying an undue burden.
Ms. Ballentine. Senator, the first leg to the Air Force's
three-legged military construction stool is to ensure that we
are supporting the combatant commanders' (COCOM) military
construction requests. And this year, the COCOM support in our
MILCON budget is about $293 million, $131 million of that is
for Pacific Command (PACOM) projects. And when we look across
the FYDP, there are 19 projects in the FYDP to the order of
$566 million.
The shift to the Pacific is important to our Nation. It
certainly is important to the Air Force and is reflected in our
budget.
Senator Schatz. Thank you.
And, Mr. Potochney, where are we with cost-sharing
arrangements, given these new enterprises?
Mr. Potochney. Some of them are in negotiation, as you
heard, in Australia. But I would highlight what we're doing in
Guam. It's almost a $9 billion effort. The Japanese are going
to contribute about a third of that, as well as building the
Futenma replacement facility, which is completely at their
expense.
So there is a fair amount of participation here with our
allies.
Senator Schatz. Essentially, the Department expects cost-
sharing in some form or fashion wherever we are, whether it's a
base or rotational force. Is that fair to say?
Mr. Potochney. Yes.
Senator Schatz. Okay.
Mr. Potochney. Subject to negotiations.
Senator Schatz. Sure. I understand it's all negotiated.
Some of it is already done, and some of it is pending, and some
of it is in the future.
Mr. Potochney. Right.
Senator Schatz. I wanted to talk about the area cost
factor. In Hawaii, it costs more than twice what it does to
construct a military facility in most places than on the
mainland. And I often hear my local commanders say that the
area cost factor makes it more difficult for certain projects
to compete in the budget process.
Obviously, mission essential projects are going to compete
reasonably well. But I worry that others, such as quality-of-
life and infrastructure improvement projects are getting pushed
to the right or cut entirely.
Mr. Potochney, what guidance has the Department given
military services about weighing area cost factors when
determining which MILCON projects should be included in their
budget requests?
Mr. Potochney. It is what it is. If it costs us $120 to
build something in Hawaii that might cost $100 on the mainland
but we need it, it competes for the investment dollars that we
have.
Senator Schatz. Right. If it is absolutely mission-
critical, I have no doubt that we get it, because that's
essential. The question becomes if you're talking about the $3
million cap in sustainment, restoration, and modernization
(SRM), if you're talking about something that is not absolutely
mission critical, I fear that places like Alaska, places like
Hawaii, get harmed in that process because things get pushed to
the right.
Is that not a concern I should have?
Mr. Potochney. I think that from what I've seen, based on
my experience, is it's worst first. So if we need something,
the need competes, and then the resources compete as well. So
there is no policy that we put out saying, for instance, let's
say with one area, the cost factor is twice as much as somebody
else, they should only get half the projects that they need.
However, the fact is, if it's more expensive to build
something somewhere, it's tougher to allocate resources to do
that. There's nothing anybody can do about that.
But I think, though, that we do have, at least in my view,
a fair, equitable, worst-first process.
Senator Schatz. Thank you.
Senator Kirk. Senator Hoeven.
Senator Hoeven. Thank you, Mr. Chairman. I'd like to thank
you and the ranking member for calling this hearing today. I
appreciate it.
And to all of our witnesses, thank you for being here, and
thank you for the good work you do.
My questions are for Assistant Secretary Ballentine. Thanks
for being here and, again, for our conversations that we've had
on some of these issues previous to this hearing.
But my first question goes to acquisition of helicopters
for the missile fields, the three bases that have missile
fields, Minot, Malmstrom, and F.E. Warren. Our airmen and -
women are still flying Huey helicopters vintage 1969.
They're doing an amazing job, but we need new helicopters.
We have the authorization. We have the funding. Now Air Force
is working through the process of getting them.
We hope Air Force will piggyback on an Army existing
contract, which went through the bid process, so that we can
get Blackhawks by 2018 versus 2020 or 2021, if they have to
start the whole bidding process over again separately.
What we think Air Force may do is bifurcate that and, at
least for the missile fields, go ahead and work with Army. And
then they can go ahead through a bid process for the other
helicopters, and that would help meet our need.
But it would necessitate some MILCON, probably in 2017, to
house the Blackhawks, because the existing facilities aren't
large enough.
Now Senator Tester, being really sharp and on the ball, is
ahead of the rest of us, so I think Malmstrom is starting in
2017 or they have made arrangements. But certainly for Minot
and F.E. Warren, we would need some help there.
So I'm asking what you think the prospects might be to do
that.
UH-1N REPLACEMENT MILCON
Ms. Ballentine. Thank you, Senator. I would say that you're
correct, that the current MILCON program to support the
recapitalization of the helicopter is based on our current
strategy for acquisition. If that strategy were to change, if
the Secretary were to change her strategy for acquisition and
move the acquisition to the left in any way, we would need to
relook at the out-year military construction programs and/or
find mitigations for the in-between time when the helicopters
arrive and when the facilities would be prepared.
Senator Hoeven. Right. We'll know here pretty soon. I'm
hopeful, again, working with Senator Tester and others, we get
this done. It's important, I think, for our security police out
there.
So we'll know soon, and then we'll come back to you and
just ask that you work with us on it. We'll obviously try to
help make it happen.
Ms. Ballentine. Yes, sir, of course. Thank you.
Senator Hoeven. The next question really goes to the KC-46
basing decision. It'd be Main Operating Base 4. I anticipate
you are starting that process.
Could you tell me about the timeline and anything you can
about the process you'll be going through for that basing
decision?
KC-46 STRATEGIC BASING PROCESS--MAIN OPERATING BASE FOUR BEDDOWN
Ms. Ballentine. Yes, sir.
So in January of this year, we announced the enterprise
definition and the criteria for Main Operating Base 4 beddown
of the KC-46. The criteria are the same as prior rounds.
We expect in the spring we will have the candidates
approved. We are going through the scoring process of the
enterprise currently as we speak. And we expect, in the next
couple of months, we will have the candidates identified for
site visits.
Once those site visits are complete, we would anticipate
that this coming winter, the winter of 2016-2017, the Secretary
will be able to make a preferred and reasonable alternatives
decision.
Then, of course, we need to go through the National
Environmental Policy Act (NEPA) process, which puts us into the
winter of 2017-2018 for a final basing decision, and we are on
track for a spring 2020 beddown of the first aircraft arrival.
Senator Hoeven. So you were ready for that one. Thank you.
I was trying to make notes. Usually, I keep up really well, but
that was a great answer. I appreciate it, and I appreciate you
moving forward the way you are. That's good.
Along the same lines, my next question relates to remotely
piloted aircraft (RPA), and I understand now you're looking at
some basing decisions for RPA. And basically, the same
question. And then also, what aircraft would you likely be
considering? And then the same question as far as timeline,
basing decision, and so forth.
RPA WING BEDDOWN
Ms. Ballentine. Sure, thank you.
So slightly different timeline for the beddown of the new
RPA wing.
As you know, the Air Combat Commander General Carlisle,
over the course of the last year, recently did a Culture and
Process Improvement study of the MQ-1 and MQ-9 programs, and he
recommended a number of changes, including the standup of a new
wing, which, of course, triggered a strategic basing process.
So let me just walk through the timeline, just like I did for
KC-46.
We intend, in the next couple of weeks here, before the
spring is out, to be able to announce both the criteria and the
enterprise definition for the RPA wing beddown.
And that puts us into the scoring period. And in the
summer, we will have the scoring completed. That's the plan.
So we'll be able to announce then the candidates. Then
once, of course, the candidates are announced, we'll proceed
with the site visits, which puts us into this coming winter,
2016-2017 winter.
We'll be teed up for the Secretary to make a decision for
her preferred and reasonable alternatives, which then puts us
into the National Environmental Policy Act (NEPA) process over
the course of this summer of 2017.
And we would hope to, over the course of summer 2017-2018,
depending on how long the NEPA process takes, be able to
announce the final beddown location or locations.
Senator Hoeven. Okay, thank you.
And then just a final comment, and that is that, on the
Grand Forks Air Force Base, we have the Grand Sky technology
park. It wouldn't happen without your leadership and the
leadership of Secretary James, former Assistant Secretary
Ferguson, and many others.
So I just want to say to the civilian leadership in Air
Force, I really appreciate your good work and how you're going
about getting things done and being creative looking to the
future, innovative, looking at these public-private
partnerships, not only to strengthen the force but to leverage
resources at a time when we need to do it.
So again, of course, we appreciate the leadership of our
men and women in the Air Force, General Welsh and everybody
else. They are fantastic, as they've always been fantastic. But
I want to make a special point to thank the civilian leadership
in the Air Force as well. We appreciate it very much.
Ms. Ballentine. Thank you very much, sir. That's always
appreciated to hear.
Senator Hoeven. Thank you.
Senator Kirk. Senator Tester.
Senator Tester. Thank you, Mr. Chairman.
I also want to echo my thanks for all of you being here.
I'm going to start with you, Mr. Potochney, and it deals
with the question that Senator Udall raised on a drone that
crashed over 2 years ago. The cleanup hasn't been done--Navy
mission, Air Force plane, Army site.
The thought occurred thought to me, it's been 2.5 years.
I've got a farm. It's in the middle of an Air Force military
operations area (MOA)--not in the middle, on the edge of it.
If the same thing would have happened there on private
property, would it have been 2 years for the cleanup under the
same circumstances? I hope not.
Mr. Potochney. I hope not as well.
Senator Tester. So what I would say is that you guys are
three branches of the same arm, and it really kind of worries
me on different things. I mean, we're fighting a war on terror
out there. You guys are in the middle of that. And if we can't
work to do something simple like this, we got problems. So I
just want to point that out.
Now I want to talk about the BRAC. All four of you talked
about BRAC, so just let me ask you a couple questions. And you
can answer a simple yes or no, or however you want to do it.
If we do another round of BRAC, will it improve readiness
or will it take away from our readiness?
Mr. Potochney. I'd say it will improve readiness, yes. It
will improve readiness, and I'd be happy to explain why.
Ms. Hammack. It'll improve readiness for the Army.
Mr. Iselin. And the Navy wouldn't support any
recommendation that didn't improve readiness.
Senator Tester. That's good to know.
Ms. Ballentine. Absolutely improve readiness.
Senator Tester. And tell me why, Mr. Potochney.
BRAC
Mr. Potochney. Well, for one thing, we wouldn't be spending
money on facilities that we don't need.
Senator Tester. Okay.
Mr. Potochney. That's important.
The second reason is it would allow us to make changes. We
have an evolving force structure. We have an evolving threat.
Senator Tester. Yes.
Mr. Potochney. Technology changes. We need to adapt to it.
And a periodic review of our infrastructure, I think, is a
reasonable thing for us to do.
Senator Tester. Okay.
For the Army, for a BRAC, do you have any idea on how many
of your facilities would be mothballed?
Ms. Hammack. We do not have an idea, sir, as to the number
of facilities that would be mothballed, but our target would be
to achieve savings of about $0.5 billion.
Senator Tester. Over how many years?
Ms. Hammack. Over approximately a 5- to 6-year period, so
we would expect a return on investment. It is usually stated
the kind of return on investment that would be targeted in the
BRAC round, but this would be an efficiency BRAC round, not a
restructuring BRAC round.
Senator Tester. Right.
Ms. Hammack. We'd be looking at consolidations, which would
give us this kind of return on investment and position us for
the future that we envision.
Senator Tester. Okay. So over 5 or 6 years, in the Army's
case, you anticipate it would save $500 million.
Ms. Hammack. And then it would continue to save $500
million annually.
Senator Tester. It's $500 million.
Ms. Hammack. Million dollars, yes, one-half billion.
Senator Tester. Okay.
The Navy took severe cuts in previous BRACs. We wouldn't
even ask that question of you.
How about the Air Force?
Ms. Ballentine. I can't tell you specifically the number of
bases we would or will close in the next round of BRAC. I can
give you a historic perspective.
Senator Tester. Yes.
Ms. Ballentine. We've never closed more than about 8
percent of our excess capacity, and we've averaged around eight
bases per BRAC round, some major, some minor. I should say
averaged eight installations, not necessarily full bases, as
you think of bases.
Senator Tester. Right. What kind of savings?
Ms. Ballentine. Our returns on investment have averaged
between 3 to 5 years, and we would anticipate at least that
good this time, because we have such significant excess
infrastructure.
We are very supportive of new legislation that would put
boundaries on high return on investment.
Senator Tester. Can you give me a dollar figure?
Mr. Potochney. Sir, if I could add, for the Department?
Senator Tester. Sure.
Mr. Potochney. Based on taking the average of the 1993 and
1995 rounds, which were excess capacity rounds and inflating
those dollars up, we're looking at saving across the Department
$2 billion a year after they're implemented.
Senator Tester. $2 billion a year.
Mr. Potochney. $2 billion a year, and with an investment of
approaching $7 billion upfront and then $2 billion a year
forever.
Senator Tester. And the $7 billion would be used for
repurposing?
Mr. Potochney. For repurposing, building the construction
at receiving sites, moving people, severance pay, you name it.
Senator Tester. Okay.
I do have some issues that are more parochial. I will put
those forward to you in writing to get back to me. It deals
with Malmstrom Air Force Base weapons storage facility, what
Senator Hoeven talked about, about the hangars for the
helicopters.
I just have one more question for you, Mr. Potochney, and
that is, you noted about 12 percent of the DoD facilities were
in poor condition, 15 percent in failing condition, that one of
four facilities need major repairs or replacement. Even more
concerning, you note that a number of facilities slipping from
poor to failing is going up instead of going down.
Given the current budget constraints, how does the
Department plan to reverse the continuing deterioration of
existing facilities and address them in the near term?
Mr. Potochney. Through the most astute prioritization
approach that we can exercise.
Senator Tester. And do you have that done now?
Mr. Potochney. We're doing that, and we'll continue to do
it. It just becomes more important as our budgets go down.
Senator Tester. Okay. So we're looking at a budget here,
and you're looking at spending it, which is what your job is
and it is what our job is.
Mr. Potochney. Yes, sir.
Senator Tester. Correct me if I'm out of bounds here, you
should have a short- and long-term plan for facilities, and
what kind of monies are needed, and where they're needed moving
forward. And I am making the assumption, you correct me if I'm
wrong, that this budget is going to address some of both, some
of the short-, some of the long-term needs that are out there.
Is that correct?
Mr. Potochney. That's right.
Senator Tester. And do you feel this budget is adequate?
Mr. Potochney. No, I do not.
Senator Tester. How much is it inadequate by?
Mr. Potochney. I think the services can each tell you what
they need to spend above what they could right now. But I would
say it's inadequate because we have facilities in failing
condition.
Senator Tester. Domestically.
Mr. Potochney. Domestic and----
Senator Tester. And international, too.
Mr. Potochney. Right.
Senator Tester. Could you get back to me with an idea on
how much this is--I mean, you told me how much we could save
with the BRAC. You ought to be able to tell me how much this is
underfunded. You can do that. I've got head nods behind you,
and probably at the table, too.
So if you could do that, I would appreciate that.
[The information follows:]
The Department of Defense's goal is to fund facilities sustainment
at 90 percent of the Facility Sustainment Model forecasted requirement.
For fiscal year 2017, the Department would need an additional $1.6
billion to achieve the sustainment goal. Sustainment provides the
annual maintenance needs of the real property portfolio. It does not
address the growing backlog of maintenance and repairs that have been
deferred. The Department's fiscal year 2015 Financial Statement
reported its Deferred Maintenance and Repair backlog for real property
exceeds $140 billion.
Senator Tester. I appreciate your guys' commitment to the
country. I very much do. And for those of you who served, your
service to the country. And thank you for being here today.
Thank you, Mr. Chairman.
Senator Kirk. Peter, let me just follow up with my top
priority, making sure that we could withstand or repel a
missile attack by Iran against the United States.
My question to you is on the MILCON for Deveselu, Romania,
which happens to be right underneath the flight path of a
missile aimed at New York from Iran.
Mr. Potochney. I'm sorry, sir, the question is?
Senator Kirk. I wanted to get an update from you on the
MILCON for----
Mr. Potochney. Can I do that for the record, sir? I would
rather give you----
Mr. Iselin. Sir, I can answer that.
Senator Kirk. Thank you.
Mr. Iselin. With strong support from the Army Corps of
Engineers, those facilities in Romania are complete, and the
forces are there.
And your question during your opening remarks about Poland,
we expect two MILCONs. One has just been awarded, and the other
will be awarded in a couple of months, to get after the
facility in Poland.
Senator Kirk. Anybody else? Anything else, Jon?
Senator Tester. Just thank you all.
Senator Kirk. I think we can wrap up.
Let me thank our witnesses for coming.
And thanks, Senator Tester. I thank all the members of the
subcommittee, and say that the record will remain open until
the close of business on Tuesday, April 13.
SUBCOMMITTEE RECESS
Senator Kirk. And we will stand adjourned.
[Whereupon, at 11:51 a.m., Thursday, April 7, the
subcommittee was recessed, to reconvene at a time subject to
the call of the Chair.]
MILITARY CONSTRUCTION, VETERANS AFFAIRS, AND RELATED AGENCIES
APPROPRIATIONS FOR FISCAL YEAR 2017
----------
WEDNESDAY, JULY 13, 2016
U.S. Senate,
Subcommittee of the Committee on Appropriations,
Washington, DC.
The subcommittee met at 10:31 a.m., in room SD-124, Dirksen
Senate Office Building, Hon. Mark Kirk (chairman) presiding.
Present: Senators Kirk, Hoeven, Boozman, Capito, Cassidy,
Tester, and Udall.
DEPARTMENT OF VETERANS AFFAIRS
STATEMENT OF HON. LAVERNE H. COUNCIL, ASSISTANT
SECRETARY FOR INFORMATION AND TECHNOLOGY
AND CHIEF INFORMATION OFFICER
ACCOMPANIED BY:
DAVID W. WALTMAN, CHIEF INFORMATION STRATEGY OFFICER, VETERANS
HEALTH ADMINISTRATION
DR. JONATHAN R. NEBEKER, DEPUTY CHIEF MEDICAL INFORMATION
OFFICER, VETERANS HEALTH ADMINISTRATION
OPENING STATEMENT OF SENATOR MARK KIRK
Senator Kirk. This hearing is to review the Department's
health record and progress towards full interoperability with
the Department of Defense (DOD).
Last year for the first time, the GAO put veterans'
healthcare on its high risk list for programs that are likely
to experience fraud, waste, abuse, and mismanagement. The
Government Accountability Office (GAO) cited information
technology challenges, one of the five reasons why veterans'
healthcare was on this list.
I want to share with you my vision for going forward here,
that we are aiming for. Whenever a soldier, sailor, airman
leaves Active Duty and becomes a veteran, we should have a 100-
percent seamless transmission of their health records to the
VA.
Here is a data point. We have about 250,000 servicemembers
leave the DOD and become veterans every year. That works out to
about 700 per day, a data flow which is well within the
possibility of everybody to cover.
We want to make sure there is a seamless continuity of
care. I have a friend now who is navigating the Department of
Veterans Affairs (VA) disability system, she was deployed in
Iraq, and had 38 separate combat events, and wanted to make
sure all of those are documented and transferred and are in her
disability petition.
Number two, we should also use the combined size of the DOD
and VA in the marketplace to establish a worldwide standard for
health medical records, encompassing 22 million people. I
figure about 2 million come from DOD and 25 million come from
VA. To have that 27 million people all as a core of people
covered by one electronic health record (EHR) standard, all
open source code would allow us to make sure that the industry
now has one Federal standard.
The rock candy mountain here is to make sure the system is
covering so many patients that the industry follows, and we
make sure the medical record industry is established along the
lines of a U.S. Code and U.S. standards.
In my State of Illinois, we have Motorola that made the
Android System all open source code. Luckily for them, it was
the right decision. The marketplace developed 70,000 apps for
the Android system to make it the most flexible and user
friendly in the world. We want to make sure that open source
environment allows us to create medical records for people with
U.S. standards.
I think we are on our way towards a several billion dollar
industry now based on this work between DOD and VA.
I just talked yesterday with the leading company that is in
this space. They told me when I talked with Judy Faulkner who
is one of the founders of a company called Epic that now
employs 5,000 people in Tammy Baldwin's State--they cover a
vast number of the patients' medical records in my State of
Illinois.
She said there are really exciting things in this field to
gather all those data and do analytics on that. She was
particularly excited about Epic's sepsis analytics, which she
said could be traced to the saving of 54,000 lives, patients
who are liable for sepsis.
Using these analytics, we could reach a new 22nd century
level of care for veterans. I want to make sure analytics are a
deep part of this electronic healthcare revolution that we have
for VA and DOD.
Let me turn it over to my good friend, Mr. Tester.
STATEMENT OF SENATOR JON TESTER
Senator Tester. Thank you, Mr. Chairman. Thank you for your
leadership on this subcommittee. We very much appreciate it.
Thank you, Secretary Council, and Ms. Melvin, and Dr. Thompson
for being here today for this hearing, I appreciate the work
you do.
We all know and we agree that accountability of VA is
critically important, whether we are talking about delivering
quality and timely care or whether we are talking about IT
initiatives such as electronic health records and scheduling
systems. We live in the 21st century, and our IT systems should
reflect that.
I do look forward to hearing from you about the progress
made and the challenges involved with VistA, electronic health
record systems, and other key IT programs. We are obviously
very interested in the direction VA is heading in terms of
modernizing VistA, and whether we are talking about going to a
commercial off-the-shelf system or developing a hybrid of the
two. Whatever decision is made, we will have long-ranging
ramifications not only for the VA and veterans but also for the
American taxpayer who will have to foot this bill.
Although we are focused on electronic health records, we
realize that EHR is only one component of a much broader IT
modernization effort and conversation. Electronic record
sharing is a great asset for both clinicians and patients, but
only if the veteran can get an appointment in the first place,
and that remains a huge challenge for many veterans in my State
and across this country.
In fact, scheduling difficulties are the top complaint that
I hear from folks in Montana, and I hear a lot of them. I can
tell you that the current system is not going to cut it, so I
am concerned that the current medical appointment scheduling
system plan is on hold, if it is not the right plan, then it
should be revised or replaced, but it cannot be put on the back
burner. We need to fix it. We need to fix it today.
So, I look forward to hearing about how the VA is working
to devise and implement a better plan, and when that will
happen. Cybersecurity is another urgent priority. As the VA's
IT system has to provide for greater interoperability among VA
providers, private sector providers, and the Department of
Defense, cybersecurity must also evolve and adapt.
The challenges facing the VA are formidable, and they are
only going to become more complicated with time.
I am also a member of the Senate Veterans' Affairs
Committee, and I am proud that Committee has advanced
legislation, the Veterans First Act, that includes a lot of
critical provisions to empower the VA to better serve our
veterans. As we all know, that bill is being held up, just the
latest example of Senate dysfunction. Nonetheless, Congress can
actually be a constructive partner in this effort.
As the pressure grows on the VA to provide seamless medical
record sharing and scheduling, I fully expect you to keep us
apprised of your efforts and your challenges. That line of
communication is critical as we move forward, and it is
critical today.
Again, I want to thank you for your service, and I look
forward to hearing your testimony. Once again, thank you, Mr.
Chairman.
Senator Kirk. Thank you. We want to welcome our witnesses
here. We have Valerie Melvin, the Director of Information
Management and Technology Resources Issues at the Government
Accountability Office; and Dr. Lauren Thompson, Director of the
DOD/VA Interagency Program Office in the Department of Defense;
and the Honorable LaVerne Council, with the Department of
Veterans Affairs, the VA's Chief Information Officer. We also
have Mr. David Waltman and Dr. Jonathan Nebeker, both with the
Veterans Health Administration (VHA).
Let's proceed and have Ms. Council begin.
SUMMARY STATEMENT OF HON. LAVERNE H. COUNCIL
Ms. Council. Chairman Kirk, Ranking Member Tester,
distinguished subcommittee members, thank you for the
opportunity to discuss how the Office of Information and
Technology (OI&T) is transforming technology that we deliver to
support our veterans.
I am joined today by Mr. David Waltman, who is VHA's Chief
Information Strategy Officer, and Dr. Jonathan Nebeker, VHA's
Deputy Chief Medical Informatics Officer.
As described in our media review, we have shifted our focus
to outcomes versus activity by emphasizing transparency,
accountability, innovation, and team work. We are building on
the legacy of VHA innovations and maintaining a united
partnership between medicine and technology. Through
implementation of a prioritized set of strategic initiatives
across our now, near, and future time horizons, we are focused
on providing a consistent high quality experience to our users
and veterans.
We are evolving into a dynamic proactive posture. We are
leaning forward, simplifying and standardizing our
infrastructure through buy first and Cloud-based delivery
models, utilizing Cloud-based technology will allow us to buy
IT services while consolidating our infrastructure and driving
the market to facilitate innovation.
Through implementation of our new strategic sourcing
function, we will be poised to take advantage of a wealth of
innovation that already exists in the marketplace to reduce
development overhead costs and speed delivery of services to
our veterans.
For the first time, we have IT portfolios in place for all
administrations. We have filled all of our new IT account
managers or ITAM positions. The ITAMs keep us connected to our
partners and ensure that we are meeting their needs.
I am proud to report that over the last year, VA's OI&T's
rating was upgraded from 19th to 5th, out of 24 Federal
agencies, in the recently released OMB Benchmarks for IT
Customer Satisfaction.
We have made strong headway toward modernizing how the VA
does business but we are also recognizing that change is not
easy and modernization is not a one time act. It requires a
relentless focus on execution and constant emphasis on
impactful outcomes.
In addition, we are transforming OI&T's leadership team,
with 74 percent of OI&T's executive leadership being in new
roles or they are new to the agency.
We are on track with our plans to close 100 percent of the
Office of Inspector General's (OIG's) 2015 recommendations by
the end of 2017, of our Federal Information Security
Modernization Act (FISMA) material weakness, and in July 2015,
VA had 267,000 accounts with elevated privileges, which allows
special access to VA systems. We have reduced that number of
accounts by 95.5 percent, exceeding all original expectations.
To reduce complexity and manage access, we are
standardizing our device policy to no more than two devices,
such as a Smartphone and laptop for each staff member. Since
March 2015, our team has identified, corrected and remediated
21 million critical and high vulnerabilities utilizing Nexus
monthly scans and enterprise patching.
We have developed an IT/non-IT policy to ensure IT dollars
are spent appropriately. We have reduced the number of
applications by 500 percent, closing off any potential path for
attackers. We have our quality and compliance function, and we
are finalizing our governance, structure and strategic sourcing
function.
OI&T is committed to safeguarding our veterans'
information, and tools, technology, and people of the highest
caliber are required. We have increased our cybersecurity
funding to $370 million, and I would like to thank this
subcommittee for helping us to fully resource our cybersecurity
capability for the very first time.
We recognize that effective cybersecurity requires
vigilance and a security conscious culture. We take security
risks seriously. We are addressing all key FISMA findings, and
we are prioritizing our efforts to close the most critical
risks first.
We know that a veteran's complete health history is
critical to providing seamless, high-quality integrated care
and benefits. We are happy to say on April 8, we certified an
interoperative with DOD in accordance with the National Defense
Authorization Act's (NDAA's) section 713(b)(1), well ahead of
the December 2016 deadline.
Last year on July 6, 2015, I was sworn in as the Assistant
Secretary and CIO of OI&T. After 1 year, I have learned a lot
about the purpose, passion, and drive it takes to make change
in a governmental agency. I have also experienced the true grit
of the people who are dedicated to the mission of serving our
veterans.
Mr. Chairman and members of the subcommittee, thank you
again for the opportunity to discuss our progress with you. I
look forward to continuing the conversation, and am happy to
take any questions you might have at this time.
[The statement follows:]
Prepared Statement of Hon. LaVerne H. Council
Good morning,
Chairman Kirk, Ranking Member Tester, distinguished members of the
subcommittee, thank you for the opportunity to discuss the progress
that the Department of Veterans Affairs (VA) is making towards
modernizing our information technology (IT) infrastructure to provide
the best possible service to our VA business partners and our Nation's
veterans. I will also discuss scheduling, medical record sharing, and
cyber security initiatives at the Department.
In order to successfully carry out these major IT initiatives and
the department's consolidation of community care programs, VA will need
a digital health platform and IT solutions that will meet the evolving
needs of our veterans, as well as support our streamlined business
processes.
I am joined by Mr. David Waltman, VHA's Chief Information Strategy
Officer, and Dr. Jonathan Nebeker, VHA's Deputy Chief Medical
Informatics Officer.
The Veterans Health Administration (VHA) and the Office of
Information & Technology (OI&T) are essential partners in delivering
quality service to our veterans. Meeting the demands of 21st century
veterans requires an interconnected system of systems, based on a
single platform, which supports an electronic health record (EHR) as
one of several components.
IT plays a critical role in enabling care for our Nation's
veterans. VA's current EHR modernization efforts focus on delivering
the tools for clinicians to provide more comprehensive, patient-
centered care and will support VA's progress to a digital health
platform.
We have made substantial progress in delivering new capabilities
leveraging VistA, the VA Health System's EHR, while also strategizing
for our future needs. Our efforts to modernize the VA's EHR and our
plans for the digital health platform are not mutually exclusive. The
success of the digital health platform is not dependent on any
particular EHR.
vista evolution/interoperability
Current State of VistA Evolution
VistA Evolution is the joint VHA and OI&T program for improving the
efficiency and quality of veterans' healthcare by modernizing VA's
health information systems, increasing data interoperability with the
Department of Defense (DOD) and network care partners, and reducing the
time it takes to deploy new health information management capabilities.
We will complete the next iteration of the VistA Evolution Program--
VistA 4--in fiscal year 2018, in accordance with the VistA Roadmap and
VistA Lifecycle Cost Estimate. VistA 4 will bring improvements in
efficiency and interoperability, and will continue VistA's award-
winning legacy of providing a safe, efficient healthcare platform for
providers and veterans.
VA takes seriously its responsibility as a steward of taxpayer
money. Our investments in VistA Evolution continue to make our
veterans' EHR system more capable and agile. VA has obligated
approximately $510 million in IT Development funds to build critical
capabilities into VistA since fiscal year 2014, when Congress first
provided specific funding for the VistA Evolution program. In addition,
VA has obligated $151 million in IT Sustainment funds and $110 million
in VHA funds for VistA Evolution. The VHA funding supports the
operational resources needed for requirements development, functional
design, content generation, development, training, business process
change, and evaluation of health IT systems.
It is important to note that VistA Evolution funding stretches
beyond EHR modernization. VistA Evolution funds have enabled critical
investments in systems and infrastructure, supporting interoperability,
networking and infrastructure sustainment, continuation of legacy
systems, and efforts--such as clinical terminology standardization--
that are critical to the maintenance and deployment of the existing and
future modernized VistA. This work was critical to maintaining our
operational capability for VistA. These investments will also deliver
value for veterans and VA providers regardless of whether our path
forward is to continue with VistA, a shift to a commercial EHR platform
as DOD is doing, or some combination of both.
Interoperability
We know that a veteran's complete health history is critical to
providing seamless, high-quality integrated care and benefits.
Interoperability is the foundation of this capability as it enables
clinicians to provide veterans with the most effective care and makes
relevant clinical data available at the point of care. Access to
accurate veteran information is one of our core responsibilities. The
Department is happy to report that, thanks to a joint VA and DOD
effort, on April 8, 2016, we jointly certified, to the House and Senate
Committees on Appropriations, Armed Services, and Veterans' Affairs
that we have met the interoperability requirement of the fiscal year
2014 National Defense Authorization Act (NDAA) Section 713(b)(1). We
have not stopped our modernization efforts, as we envision further
enhancements that we know are necessary for greater efficiency.
For front-line healthcare teams, the two most exciting products
from VistA Evolution are the Joint Legacy Viewer (JLV) and the
Enterprise Health Management Platform (eHMP). JLV is a clinical
application that provides an integrated, chronological display of
health data from VA and DOD providers in a common data viewer. VA and
DOD clinicians can use JLV to access, on demand, the health records of
veterans and Active Duty and Reserve servicemembers. JLV provides a
patient-centric, rather than facility-centric view of health records in
near real time. Veterans Benefits Administration (VBA) offices have
access to JLV and can use it to expedite claims in certain situations.
As of July 7, 2016, JLV had more than 198,000 authorized users in
VA and DOD together, including 158,159 authorized VA users. The team is
authorizing several thousand new users in VA each week. In VA, more
than 11,000 VBA personnel are authorized to use JLV to help process
claims.
The process for granting access to JLV is both simple and secure.
JLV allows us to monitor access and usage by capturing logins, records
viewed, activities by users, and transactions per hour. In the interest
of privacy, security, and safety, JLV is restricted to healthcare
providers and benefits administrators. Beneficiaries cannot access JLV,
but this in no way affects their rights to copies of their health
records upon request. We simultaneously maintain tight controls over
the system and ensure efficient access to clinicians and benefits
administrators who need it to do their jobs.
JLV has been a critical step in connecting VA and DOD health
systems, but it is a read-only application. Building on the
interoperability infrastructure supporting JLV, the Enterprise Health
Management Platform (eHMP) will ultimately replace our current read-
write point of care application. The current application, called the
Computerized Patient Record System, or CPRS, has been in use since
1996. CPRS served VA for many years as an industry leading point of
care tool for providers, but it has many limitations for modern care
delivery.
eHMP will overcome these limitations, and provide a modern web
application and clinical data services platform to support veteran-
centric, team-based, quality driven care. eHMP will also natively
support interoperability between VA, DOD and community health partners.
We are deploying an initial read only version of eHMP now, and will
begin deploying eHMP version 2.0 with write-back capabilities in the
second quarter of fiscal year 2017. Clinicians will be able to write
notes and order laboratory and radiology tests in version 2.0. eHMP 2.0
will also support tasking for team-based management and communication
with improved tracking to ensure follow through on tasks.
Veterans will benefit from eHMP in several ways. For example, eHMP
will provide a complete view of a veteran's health history from all
available VA, DOD and community provider sources of information. This
will help providers develop a more complete picture of a veteran's
history, enabling better treatment decisions.
The veteran's voice will also be front and center in eHMP.
Veterans' goals and preferences for care will become part of the
information all providers see. eHMP will also provide a feature
dedicated to recording and maintaining a veteran's service history,
including duty locations and what type of work they performed during
their service. This information could then be used in proactively
identifying veterans who may be at risk for certain health issues, or
eligible for medical care based on locations or times in which they
served.
Veterans will also benefit from VA care teams who can work together
more efficiently and effectively using the care coordination and task
management tools eHMP will provide. For example, if a veteran is
referred for a particular test or consultation with a specialist,
workflow management tools in eHMP will ensure the right activities have
taken place in advance of the referral. This will help reduce wasted or
unneeded appointments, save time for both veterans and providers. In
turn, if providers are more efficient, they are able to serve more
veterans, which will have an overall positive impact on veteran access
to care. All of these efforts align with the goals outlined by the
Federal Health Information Technology Strategic Plan 2015--2020 and
Connecting Health and Care for a Nation: A Shared Nationwide
Interoperability Roadmap, produced by the Office of the National
Coordinator for Health Information Technology (ONC) in collaboration
with VA, DOD and other partners.
Upon completion, eHMP will support the following capabilities:
--Veteran-centric healthcare.--eHMP will allow clinicians to tailor
care plans to specific clinical goals and help veterans achieve
their healthcare goals.
--Team-based healthcare.--eHMP will provide an interoperable care
plan in which clinical care team members, including the
patient, will understand the goals of care and perform explicit
tasks to execute the plan. eHMP will also monitor tasks that
are not completed as specified and escalate them to the
appropriate team.
--Quality-driven healthcare.--eHMP will support the diffusion of best
practices, including evidence-based clinical process
standardization. eHMP will collect data on how clinicians
address conditions and power analytics to generate new evidence
for better care and best practices.
--Improved access to health information.--eHMP will integrate health
data from VA, DOD, and community care partners into a
customizable interface that provides a holistic view of each
veteran's health records.
Fundamentally, our efforts to improve information systems are about
data, not software. Regardless of the software platform, we need to be
able to access the right data at the right time. Health data
interoperability with DOD and network providers is important-- but it
is equally important to understand that this is just one aspect of
having a comprehensive profile to streamline and unify the veteran
experience.
Using eHMP as a tool, healthcare teams will better understand
veterans' needs, coordinate care plans, and optimize care intensity in
VA and throughout the high-performing network of care.
looking to the future
Modernization is a process, not an end, and the release of VistA 4
in fiscal year 2018 will not be the ``end'' of VA's EHR modernization.
VA has always intended to continue modernizing VA's EHR, beyond VistA
4, with more modern and flexible components.
Technology and clinical capabilities must consistently evolve to
meet the growing needs of our veterans. The VistA Evolution program is
just that--an evolving capability that is an invaluable part, but not
the end of VA's EHR modernization.
Digital Health Platform
Due to the expansion of care in the community, a rapidly growing
number of women veterans, and increased specialty care needs, the need
for more agility in our EHR has never been greater. We are looking
beyond what VistA 4 will deliver in fiscal year 2018, and we are
evaluating options for the creation of a Digital Health Platform to
ensure that we have the best strategic approach to modernizing our EHR
for the next 25 years.
The VA healthcare system must keep the veteran experience at its
core and incorporate effective clinical management, hospital operations
capability, and predictive analytics. We do not have all of this today
with VistA.
To prepare for this new era in connected care, VA is looking beyond
the EHR to a digital health platform that can better support veterans
throughout the health continuum. These factors drive the need for
continuous innovation and press us to plan further into the future.
The EHR is the central component of the digital health platform.
However, an EHR by itself does not have all of the capabilities
required to manage care in the community, respond to the changing needs
of the veteran population, support clinical management, and provide the
best overall veteran experience with the VA healthcare system.
We have conducted a business case outlining our vision for the
digital health platform. Our goal is to have a modern and integrated
healthcare system that would incorporate best-in-class technologies and
standards to give it the look, feel, and capabilities users have come
to expect in the private sector.
The digital health platform will be agile, and will leverage
international open-source standards such as the Fast Healthcare
Interoperability Resources (FHIR) framework.
FHIR converts granular health data points into standardized data
formats already well known to healthcare IT application developers. The
main goal of FHIR is to simplify implementation without sacrificing
information integrity. VA is working with standards organizations and
industry partners to further refine FHIR to allow the level of
interoperability necessary for the functionality described above.
Health Level 7 International (HL7), a not-for-profit American
National Standards Institute (ANSI)-certified standards developing
organization, developed FHIR. HL7 has produced healthcare data exchange
and information modeling standards since its founding in 1987. Emerging
industry practices and lessons learned from previous standards
frameworks informed HL7's development of FHIR.
The digital health platform will be a system of systems. It is not
dependent on any particular EHR, and VA can integrate new or existing
resources into the system without sacrificing data interoperability.
One of the digital health platform's defining features will be system-
wide cloud integration, a marked improvement over the more than 130
instances of VistA that we have today.
OI&T and VHA have agreed upon a strategy to guide the formal
planning of modernizing VA healthcare delivery beyond the conclusion of
VistA 4 in fiscal year 2018. Our vision calls for a digital health
platform that will go beyond EHR modernization to create a better
overall experience for the veteran throughout the continuum of care. We
continue to work closely with VHA to formulate our approach and apply
the rigor of formalized program planning, and will keep this
subcommittee updated as the process unfolds.
scheduling
We recognize the urgent need for improvement in VA's appointment
scheduling system. We are evaluating the Veteran Appointment Request
(VAR) application and the VistA Scheduling Enhancement (VSE) through
simultaneous pilot programs. We are testing VAR at two facilities. We
have been testing VSE at 10 locations, and are in the training phase
for national deployment of VSE.
VAR is a new veteran facing capability allowing veterans to
directly request primary care and mental health appointments as face-
to-face, telephone, or video visits by specifying three desired
appointment dates. The software allows established primary care
patients to schedule and cancel primary care appointments directly with
their already-assigned Patient Aligned Care Team provider.
We are testing VAR at two facilities in the VA New England Health
System (Veterans Integrated Service Network (VISN) 1)--the VA
Connecticut Healthcare System (West Haven) and the VA Boston Healthcare
System (Jamaica Plain).
VSE updates the legacy command line scheduling application with a
modern graphical user interface. This capability reduces the time it
takes schedulers to enter new appointments, and makes it easier to see
provider availability. VSE provides critical, near-term enhancements,
including a graphical user interface, aggregated facility views,
profile scheduling grids, single queues for appointment requests, and
resource management reporting.
Our 10 VSE Initial Operational Capability sites are:
1. Charles George VA Medical Center in Asheville, North Carolina
2. West Palm Beach VA Medical Center in West Palm Beach, Florida
3. Chillicothe VA Medical Center in Chillicothe, Ohio
4. VA Hudson Valley Health Care System in New York
5. Louis Stokes Cleveland VA Medical Center in Cleveland, Ohio
6. VA New York Harbor Health Care System in New York, New York
7. VA Salt Lake City Health Care System in Utah
8. VA Southern Arizona Health Care System in Tucson, Arizona
9. James H. Quillen VA Medical Center in Mountain Home, Tennessee
10. Washington, DC VA Medical Center in Washington, DC
VA schedulers tell us that they need a system focused purely on
scheduling. VSE and VAR pilots are available now and show positive
results in meeting the business requirements of our partners. In
contrast, the Medical Appointment Scheduling System (MASS) project
includes additional features that add complexity, leading us to put
MASS on a strategic hold while our team ensures that we meet all
requirements without undue processing difficulties. VA will carefully
measure the results of the VSE pilot to determine the best use of
resources that will meet veteran needs. VA is working hard to ensure
that every technological tool and improvement makes judicious use of
taxpayer dollars while providing solutions that support today's
veterans' needs.
enterprise cybersecurity strategy
OI&T is facing the ever-growing cyber threat head on--we are
committed to protecting all veteran information and VA data and
limiting access to only those with the proper authority. This
commitment requires us to think enterprise-wide about security
holistically. We have dual responsibility to store and protect veterans
records, and our strategy addresses both privacy and security.
In order to achieve and maintain the highest level of security, we
need the active participation of everyone who accesses VA systems. We
are providing comprehensive education to ensure that all VA employees
remain vigilant. We have updated our National Rules of Behavior and our
annual security training, and we are emphasizing continuous engagement
with our employees. Information security poses constant challenges, and
it is only through continuous reinforcement that our employees can
support us in this battle.
The first step in our transformation was addressing enterprise
cyber security. We delivered an actionable, far-reaching, cybersecurity
strategy and implementation plan for VA to Congress on September 28,
2015, as promised. We designed our strategy to counter the spectrum of
threat profiles through a multi-layered, in-depth defense model enabled
through five strategic goals.
--Protecting Veteran Information and VA Data: We are strongly
committed to protecting data. Our data security approach
emphasizes in-depth defense, with multiple layers of protection
around all veteran and VA data.
--Defending VA's Cyberspace Ecosystem: Providing secure and resilient
VA information systems technology, business applications,
publically accessible platforms, and shared data networks is
central to VA's ability to defend VA's cyberspace ecosystem.
Addressing technology needs and operations that require
protection, rapid response protocols, and efficient restoration
techniques is core to effective defense.
--Protecting VA Infrastructure and Assets: Protecting VA
infrastructure requires going beyond the VA-owned and VA-
operated technology and systems within VA facilities to include
the boundary environments that provide potential access and
entry into VA by cyber adversaries.
--Enabling Effective Operations: Operating effectively within the
cyber sphere requires improving governance and organizational
alignment at enterprise, operational, and tactical levels
(points of service interactions). This requires VA to integrate
its cyberspace and security capabilities and outcomes within
larger governance, business operation, and technology
architecture frameworks.
--Recruiting and Retaining a Talented Cybersecurity Workforce: Strong
cybersecurity requires building a workforce with talent in
cybersecurity disciplines to implement and maintain the right
processes, procedures, and tools.
VA's Enterprise Cybersecurity Strategy is a major step forward in
VA's commitment to safeguarding veteran information and VA data within
a complex environment. The strategy establishes an ambitious yet
carefully crafted approach to cybersecurity and privacy protections
that enable VA to execute its mission of providing quality healthcare,
benefits, and services to veterans, while delivering on our promise to
keep veteran information and VA data safe and secure.
In addition, we have a large legacy issue that we need to address.
In the fiscal year 2017 budget request, VA ha increased requested
spending on security to $370 million, fully funding and fully
resourcing our security capability for the first time. We are committed
to eliminating our material weakness in fiscal year 2017, and these
funds are enabling those efforts. In addition, VA is investing over $50
million to create a data-management backbone. I want to thank this
subcommittee for fully funding the President's request in this area.
it transformation and enterprise program management office
OI&T is transforming. Persistent internal challenges exist in
delivering IT services, and external pressures have compelled us to
change and adapt. Through the MyVA initiative, VA is modernizing its
culture, processes, and capabilities to put veterans first, and is
giving our team the opportunity to make a real difference in veterans'
lives. This momentum is driving us to transform OI&T on behalf of our
partners, our employees, and veterans.
EPMO is building our momentum in OI&T's transformation. EPMO hosts
our biggest IT programs, including the Veterans Health Information
Systems and Technology Architecture (VistA) Evolution,
Interoperability, the Veterans Benefits Management System, and Medical
Appointment Scheduling System (MASS). EPMO also supports the Federal
Information Technology Acquisition Reform Act (FITARA)
requirements.
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
EPMO ensures alignment of program portfolios to strategic
objectives and provides visibility and governance into the programs.
For enterprise initiatives, EPMO helps program and project teams to
better develop execution plans, monitor progress, and report the status
of these programs and projects. EPMO enables partnerships with IT
architects for enterprise collaboration and serves as a program/project
resource for the delivery of enterprise and cross-functional programs.
This helps identify Shared Services Enterprise Programs and will help
plan resource requirements with portfolios and architecture.
EPMO has already produced results. The Veteran-focused Integration
Process (VIP) is a project-level based process that replaces the
Program Management Accountability System (PMAS). VIP streamlines IT
product release activities and increases the speed of delivering high-
quality, secure capabilities to veterans. VIP is revolutionary because
it utilizes a single release process--designed to eliminate redundancy
in review, approval, and communications--that all VA organizations will
follow by the end of 2016. These releases are scheduled on a 3-month
cadence--an improvement over the previous 6-month standard--and allow
greatly needed IT services to be delivered to veterans more frequently.
VIP reduces overhead and is more efficient and cost effective than
PMAS. VIP's efficiencies include reducing the review process from 10
independent groups with 90 people to a single group of 30 people
focused on ensuring that products meet specified, consistent criteria
for release.
VIP focuses on doing rather than documenting, with a reduction of
artifacts from more than 50 to just 7, plus the Authority to Operate,
and the shift from a 6-month to a 3-month delivery cycle. Further, as a
guarantee to our work, EPMO will ensure that product teams stay
assigned to their projects for at least 90 days after the final
deployment.
conclusion
VA is at a historic crossroad and will need to make bold reforms
that will shape how we deliver IT services and healthcare in the
future, as well as improve the experiences of veterans, community
providers, and VA staff. Throughout this transformation, our number one
priority has and will always be the veteran--ensuring a safe and secure
environment for their information and improving their experience is our
goal.
As with all issues, VA strongly values the input and support of all
its stakeholders. We realize the vital role they play in assisting us
in providing timely, high-quality care to veterans, and we look forward
to continued open dialogue.
This concludes my testimony, and I am happy to answer your
questions.
Senator Kirk. Thank you. We will hear from Valerie Melvin,
Director, Information Management and Technology Resources
Issues, U.S. Government Accountability Office.
GOVERNMENT ACCOUNTABILITY OFFICE
STATEMENT OF VALERIE C. MELVIN, DIRECTOR, INFORMATION
MANAGEMENT AND TECHNOLOGY RESOURCES ISSUES
Ms. Melvin. Good morning, Chairman Kirk, Ranking Member
Tester, and members of the subcommittee. Thank you for inviting
me to testify today. VA's electronic health records system,
VistA, is essential to the healthcare of veterans, and the
Department has been taking steps over many years toward
modernizing the system.
Also, for almost two decades, it has been working with DOD
to advance electronic health record interoperability between
their systems. However, while the Department has made progress
in these efforts, significant IT challenges have contributed to
our designating VA's healthcare as high risk, as you mentioned
earlier.
At your request, my testimony today summarizes key findings
and concerns about the Department's efforts based on previous
reports that we have issued and VA's actions in response to our
recommendations.
With regard to electronic health record interoperability,
we have consistently pointed to a troubled path toward
achieving this capability. Since 1998, VA has undertaken a
patchwork of initiatives with DOD to increase health
information exchange between their systems. These efforts have
yielded increasing amounts of standardized health data, and
made an integrated view of the data available to clinicians.
Nevertheless, a modernized VA electronic health record
system that is fully interoperable with DOD's system is still
years away.
In 2011, VA and DOD announced that they would develop one
integrated system to replace both Departments' separate
systems, and thus sidestep many of their previous challenges to
achieving interoperability. However, after 2 years and
approximately $564 million reportedly spent, the Departments
abandoned this plan, saying separate systems with interoperable
capabilities between them could be achieved faster and at less
overall cost.
Yet, as VA and DOD have proceeded on separate paths, we
have continued to highlight three primary concerns with their
approach. First, the Departments have lacked outcome-oriented
goals and metrics to clearly define what they aim to achieve
from their interoperability efforts. Thus, an important
question remains as to when VA intends to define the extent of
interoperability it needs to provide the highest quality of
patient care, and when the Department intends to achieve this
with DOD.
VA concurred with our recommendation that it develop such
goals and metrics, and subsequently said it is defining an
approach for identifying health outcome-oriented metrics and
baseline measurements.
Second, VA's plan to modernize VistA raises concerns about
duplication with DOD's system acquisition. The Departments have
identified 10 areas in which they have common healthcare
business needs, and a study has identified over 97 percent of
inpatient requirements for electronic health record systems as
being common to both Departments.
Further, despite our recommending that it do so, VA has yet
to substantiate its claim that modernizing VistA, together with
DOD acquiring a new system, can be achieved faster and at less
cost than a single joint system. Thus, an important question
that remains as to how VA and DOD can continue to justify the
need for separate systems.
Finally, while VA has begun implementing VistA
modernization plans, it is doing so amid uncertainty about its
approach. A recent independent assessment of its health IT
raised questions about the lack of any clear advances in the
Department's efforts over the past decade, and recommended that
VA assess its alternatives for delivering modernized
capabilities.
Nevertheless, the Under Secretary for Health has maintained
that the Department is following through with plans to complete
a modernized system in fiscal year 2018, while the CIO has
indicated that VA is reconsidering how best to meet its needs.
Thus, with regard to VA's electronic health record
interoperability and system modernization efforts, uncertainty
and important questions remain about what the Department is
prepared to accomplish, in what timeframes, and at what costs.
This concludes my oral statement. I would be pleased to
respond to your questions.
[The statement follows:]
Prepared Statement of Valerie C. Melvin
GAO HIGHLIGHTS
Highlights of GAO-16-807T, a testimony before the Subcommittee on
Military Construction, Veterans Affairs, and Related Agencies,
Committee on Appropriations, U.S. Senate.
Why GAO Did This Study
VA operates one of the Nation's largest healthcare systems, serving
millions of veterans each year. For almost two decades, the department
has undertaken a patchwork of initiatives with DOD to increase
interoperability between their respective electronic health record
systems. During much of this time, VA has also been planning to
modernize its system. While the department has made progress in these
efforts, it has also faced significant information technology
challenges that contributed to GAO's designation of VA healthcare as a
high risk area.
This statement summarizes GAO's August 2015 report (GAO-15-530) on
VA's efforts to achieve interoperability with DOD's electronic health
records system. It also summarizes key content from GAO's reports on
duplication, overlap, and fragmentation of Federal Government programs.
Lastly, this statement provides updated information on VA's actions in
response to GAO's recommendation calling for an interoperability and
electronic health record system plan.
What GAO Recommends
In prior reports, GAO has made numerous recommendations to VA to
improve the modernization of its IT systems. Among other things, GAO
has recommended that VA address challenges associated with
interoperability, develop goals and metrics to determine the extent to
which the modernized systems are achieving interoperability, and
address shortcomings with planning. VA generally agreed with GAO's
recommendations.
View GAO-16-807T. For more information, contact Valerie C. Melvin
at (202) 512-6304 [email protected].
ELECTRONIC HEALTH RECORDS
VA's Efforts Raise Concerns about Interoperability Goals and Measures,
Duplication with DOD, and Future Plans
what gao found
Even as the Department of Veterans Affairs (VA) has undertaken
numerous initiatives with the Department of Defense (DOD) that were
intended to advance the ability of the two departments to share
electronic health records, the departments have not identified outcome-
oriented goals and metrics to clearly define what they aim to achieve
from their interoperability efforts. In an August 2015 report, GAO
recommended that the two departments establish a timeframe for
identifying outcome-oriented metrics, define related goals as a basis
for determining the extent to which the departments' systems are
achieving interoperability, and update their guidance accordingly.
Since that time, VA has established a performance architecture program
that has begun to define an approach for identifying outcome-oriented
metrics focused on health outcomes in selected clinical areas and has
begun to establish baseline measurements. GAO is continuing to monitor
VA's and DOD's efforts to define metrics and report on the
interoperability results achieved between the departments.
Following an unsuccessful attempt to develop a joint system with
DOD, VA switched tactics and moved forward with an effort to modernize
its current system separately from DOD's planned acquisition of a
commercially available electronic health record system. The department
took this course of action even though, in May 2010, it identified 10
areas of healthcare business needs in common with those of DOD.
Further, the results of a 2008 study pointed out that more than 97
percent of inpatient requirements for electronic health record systems
are common to both departments. GAO noted that the departments' plans
to separately modernize their systems were duplicative and recommended
that their decisions should be justified by comparing the costs and
schedules of alternate approaches. The departments agreed with GAO's
recommendations and stated that their initial comparison indicated that
separate systems would be more cost effective. However, the departments
have not provided a comparison of the estimated costs of their current
and previous approaches. Further, both departments developed schedules
that indicated their separate modernization efforts will not be
completed until after the 2017 planned completion date for the previous
joint system approach.
VA has developed a number of plans to support its development of
its electronic health record system, called VistA, including a plan for
interoperability and a road map describing functional capabilities to
be deployed through fiscal year 2018. According to the road map, the
first set of capabilities was delivered by the end of September 2014
and included a foundation for future functionality, such as an enhanced
graphical user interface and enterprise messaging infrastructure.
However, a recent independent assessment of health information
technology (IT) at VA reported that lengthy delays in modernizing VistA
had resulted in the system becoming outdated. Further, this study
questioned whether the modernization program can overcome a variety of
risks and technical issues that have plagued prior VA initiatives of
similar size and complexity. Although VA's Under Secretary for Health
has asserted that the department will complete the VistA Evolution
program in fiscal year 2018, the Chief Information Officer has
indicated that the department is reconsidering how best to meet its
future electronic health record system needs.
______
Chairman Kirk, Ranking Member Tester, and members of the
subcommittee:
Thank you for inviting me to testify at today's hearing on the
Department of Veterans Affairs' (VA) electronic health record system--
the Veterans Health Information Systems and Technology Architecture
(VistA)--and the department's progress toward achieving
interoperability with the Department of Defense (DOD). For almost two
decades, VA has been working with DOD to advance electronic health
record interoperability between their systems, in an attempt to achieve
the seamless sharing of healthcare data and make patient data more
readily available to healthcare providers, reduce medical errors, and
streamline administrative functions. Also, for much of this same time
period, VA has been planning and taking steps toward the modernization
of its electronic health record system, with the intent of ensuring
that the department can effectively deliver care for the millions of
veterans and others that it serves.
Since 2001, we have issued a number of reports that addressed VA's
progress, in conjunction with DOD, toward achieving interoperable
electronic health records between their separate systems,\1\ as well as
its project with DOD to jointly develop a shared electronic health
record system.\2\ In addition, we have reported on actions that VA has
taken with regard to modernizing its electronic health record
system.\3\ While the department has made progress in these efforts, it
has also faced significant information technology challenges that
contributed to our designation of VA healthcare as a high risk area.\4\
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\1\ GAO, Electronic Health Records: Outcome-Oriented Metrics and
Goals Needed to Gauge DOD's and VA's Progress in Achieving
Interoperability, GAO-15-530 (Washington, D.C.: Aug. 13, 2015);
Opportunities to Reduce Potential Duplication in Government Programs,
Save Tax Dollars, and Enhance Revenue, GAO-11-318SP (Washington, D.C.:
Mar. 1, 2011); Electronic Health Records: DOD and VA Should Remove
Barriers and Improve Efforts to Meet Their Common System Needs, GAO-11-
265 (Washington, D.C.: Feb. 2, 2011); Electronic Health Records: DOD
and VA Interoperability Efforts are Ongoing; Program Office Needs to
Implement Recommended Improvements, GAO-10-332 (Washington, D.C.: Jan.
28, 2010); Electronic Health Records: DOD and VA Have Increased Their
Sharing of Health Information, but More Work Remains, GAO-08-954,
(Washington, D.C.: July 28, 2008); and Computer-Based Patient Records:
Better Planning and Oversight By VA, DOD, and IHS Would Enhance Health
Data Sharing, GAO-01-459 (Washington, D.C.: Apr. 30, 2001).
\2\ GAO, Electronic Health Records: VA and DOD Need to Support Cost
and Schedule Claims, Develop Interoperability Plans, and Improve
Collaboration, GAO-14-302 (Washington, D.C.: Feb. 27, 2014).
\3\ GAO, Veterans Affairs: Health Information System Far from
Complete; Improved Project Planning and Oversight Needed, GAO-08-805
(Washington, D.C.: Jun. 30, 2008).
\4\ GAO, High Risk Series: An Update, GAO-15-290 (Washington, D.C.:
Feb. 11, 2015).
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At your invitation, my testimony today summarizes our key findings
and concerns from this overall body of work. Specifically, in
developing this testimony, we relied on our previous reports, as well
as information that we obtained and reviewed on VA's actions in
response to our previous recommendations. The reports cited throughout
this statement include detailed information on the scope and
methodology for our reviews.
The work upon which this statement is based was conducted in
accordance with generally accepted government auditing standards. Those
standards require that we plan and perform the audit to obtain
sufficient, appropriate evidence to provide a reasonable basis for our
findings and conclusions based on our audit objectives. We believe that
the evidence obtained provides a reasonable basis for our findings and
conclusions based on our audit objectives.
Background
VA operates one of the largest healthcare systems in America,
providing care to millions of veterans and their families each year.
The department's health information system--VistA--serves an essential
role in helping the department to fulfill its healthcare delivery
mission. Specifically, VistA is an integrated medical information
system that was developed in-house by the department's clinicians and
information technology (IT) personnel, and has been in operation since
the early 1980s.\5\ The system consists of 104 separate computer
applications, including 56 health provider applications; 19 management
and financial applications; 8 registration, enrollment, and eligibility
applications; 5 health data applications; and 3 information and
education applications. Within VistA, an application called the
Computerized Patient Record System enables the department to create and
manage an individual electronic health record for each VA patient.
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\5\ VistA began operation in 1983 as the Decentralized Hospital
Computer Program. In 1996, the name of the system was changed to VistA.
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Electronic health records are particularly crucial for optimizing
the healthcare provided to veterans, many of whom may have health
records residing at multiple medical facilities within and outside the
United States. Taking these steps toward interoperability--that is,
collecting, storing, retrieving, and transferring veterans' health
records electronically--is significant to improving the quality and
efficiency of care. One of the goals of interoperability is to ensure
that patients' electronic health information is available from provider
to provider, regardless of where it originated or resides.
Since 1998, VA has undertaken a patchwork of initiatives with DOD
to allow the departments' health information systems to exchange
information and increase interoperability.\6\ Among others, these have
included initiatives to share viewable data in the two departments'
existing (legacy) systems, link and share computable data between the
departments' updated heath data repositories, and jointly develop a
single integrated system that would be used by both departments. Table
1 summarizes a number of these key initiatives.
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\6\ DOD uses a separate electronic health record system, the Armed
Forces Health Longitudinal Technology Application, which consists of
multiple legacy medical information systems developed from customized
commercial software applications.
TABLE 1: HISTORY OF THE DEPARTMENTS OF VETERANS AFFAIRS' AND DEFENSE'S ELECTRONIC HEALTH RECORD INTEROPERABILITY
INITIATIVES
----------------------------------------------------------------------------------------------------------------
Initiative Year begun Description
----------------------------------------------------------------------------------------------------------------
Government Computer-Based Patient Record 1998....................... This interface was expected to compile
requested patient health information in
a temporary, ``virtual'' record that
could be displayed on a user's computer
screen.
Federal Health Information Exchange..... 2002....................... The Government Computer-Based Patient
Record initiative was narrowed in scope
to focus on enabling the Department of
Defense (DOD) to electronically transfer
service members' health information to
the Department of Veterans Affairs (VA)
upon their separation from active duty.
The resulting initiative, completed in
2004, was renamed the Federal Health
Information Exchange. This capability is
currently used by the departments to
transfer data from DOD to VA.
Bidirectional Health Information 2004....................... This capability provides clinicians at
Exchange. both departments with viewable access to
records on shared patients. It is
currently used by VA and DOD to view
data stored in both departments' heath
information systems.
Clinical Data Repository/Health Data 2004....................... This interface links DOD's Clinical Data
Repository Initiative. Repository and VA's Health Data
Repository to achieve a two-way exchange
of health information.
Virtual Lifetime Electronic Record...... 2009....................... To streamline the transition of
electronic medical, benefits, and
administrative information between the
departments, this initiative enabled
access to electronic records for service
members as they transition from military
to veteran status and throughout their
lives. It also expands the departments'
health information-sharing capabilities
by enabling access to private-sector
health data.
Joint Federal Health Care Center........ 2010....................... The Captain James A. Lovell Federal
Health Care Center was a 5-year
demonstration project to integrate DOD
and VA facilities in the North Chicago,
Illinois, area. It is the first
integrated Federal healthcare center for
use by beneficiaries of both
departments, with an integrated DOD-VA
workforce, a joint funding source, and a
single line of governance.
----------------------------------------------------------------------------------------------------------------
Source: GAO summary of prior work and department documentation GAO-16-807T.
In addition to the initiatives mentioned in table 1, VA has worked
in conjunction with DOD to respond to provisions in the National
Defense Authorization Act for fiscal year 2008,\7\ which required the
departments to jointly develop and implement fully interoperable
electronic health record systems or capabilities in 2009. Yet, even as
the departments undertook numerous interoperability and modernization
initiatives, they faced significant challenges and slow progress. For
example, VA's and DOD's success in identifying and implementing joint
IT solutions has been hindered by an inability to articulate explicit
plans, goals, and timeframes for meeting their common health IT needs.
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\7\ Public Law No. 110-181, Sec. 1635, 122 Stat. 3, 460-463 (2008).
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In March 2011, the secretaries of VA and DOD announced that they
would develop a new, joint integrated electronic health record system
(referred to as iEHR). This was intended to replace the departments'
separate systems with a single common system, thus sidestepping many of
the challenges they had previously encountered in trying to achieve
interoperability. However, in February 2013, about 2 years after
initiating iEHR, the secretaries announced that the departments were
abandoning plans to develop a joint system, due to concerns about the
program's cost, schedule, and ability to meet deadlines. The
Interagency Program Office (IPO), put in place to be accountable for
VA's and DOD's efforts to achieve interoperability,\8\ reported
spending about $564 million on iEHR between October 2011 and June 2013.
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\8\ The National Defense Authorization Act for fiscal year 2008
called for the departments to set up an interagency program office to
be a single point of accountability to implement fully interoperable
electronic health record systems or capabilities by September 30, 2009.
This office was chartered in January 2009.
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In light of VA and DOD not implementing a solution that allowed for
the seamless electronic sharing of healthcare data, the National
Defense Authorization Act for fiscal year 2014 \9\ included
requirements pertaining to the implementation, design, and planning for
interoperability between the departments' electronic health record
systems. Among other actions, provisions in the act directed each
department to (1) ensure that all healthcare data contained in their
systems (VA's VistA and DOD's Armed Forces Health Longitudinal
Technology Application, referred to as AHLTA) complied with national
standards and were computable in real time by October 1, 2014; and (2)
deploy modernized electronic health record software to support
clinicians while ensuring full standards-based interoperability by
December 31, 2016.
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\9\ Public Law No. 113-66, Div. A, Title VII, Sec. 713, 127 Stat.
672, 794-798 (Dec. 26, 2013).
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In August 2015, we reported that VA, in conjunction with DOD, had
engaged in several near-term efforts focused on expanding
interoperability between their existing electronic health record
systems. For example, the departments had analyzed data related to 25
``domains'' identified by the Interagency Clinical Informatics Board
and mapped health data in their existing systems to standards
identified by the IPO. The departments also had expanded the
functionality of their Joint Legacy Viewer--a tool that allows
clinicians to view certain healthcare data from both departments in a
single interface.
More recently, in April 2016, VA and DOD certified that all
healthcare data in their systems complied with national standards and
were computable in real time. However, VA acknowledged that it did not
expect to complete a number of key activities related to its electronic
health record system until sometime after the December 31, 2016,
statutory deadline for deploying modernized electronic health record
software with interoperability. Specifically, the department stated
that deployment of a modernized VistA system at all locations and for
all users is not planned until 2018.
Together with DOD and the Interagency Program Office, VA Needs to
Develop Goals and Metrics for Assessing Interoperability
Even as VA has undertaken numerous initiatives with DOD that were
intended to advance electronic health record interoperability, a
significant concern is that these departments have not identified
outcome-oriented goals and metrics to clearly define what they aim to
achieve from their interoperability efforts, and the value and benefits
these efforts are expected to yield. As we have stressed in our prior
work and guidance,\10\ assessing the performance of a program should
include measuring its outcomes in terms of the results of products or
services. In this case, such outcomes could include improvements in the
quality of healthcare or clinician satisfaction. Establishing outcome-
oriented goals and metrics is essential to determining whether a
program is delivering value.
---------------------------------------------------------------------------
\10\ GAO, Electronic Health Record Programs: Participation Has
Increased, but Action Needed to Achieve Goals, Including Improved
Quality of Care, GAO-14-207 (Washington, D.C.: March 6, 2014);
Designing Evaluations: 2012 Revision, GAO-12-208G (Washington, D.C.:
Jan. 31, 2012); Performance Measurement and Evaluation: Definitions and
Relationships, GAO-11-646SP (Washington, D.C.: May 2, 2011); and
Executive Guide: Effectively Implementing the Government Performance
and Results Act, GAO/GGD-96-118 (Washington, D.C.: June 1, 1996).
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The IPO is responsible for monitoring and reporting on VA's and
DOD's progress in achieving interoperability and coordinating with the
departments to ensure that these efforts enhance healthcare services.
Toward this end, the office issued guidance that identified a variety
of process-oriented metrics to be tracked, such as the percentage of
health data domains that have been mapped to national standards. The
guidance also identified metrics to be reported that relate to tracking
the amounts of certain types of data being exchanged between the
departments, using existing capabilities. This would include, for
example, laboratory reports transferred from DOD to VA via the Federal
Health Information Exchange and patient queries submitted by providers
through the Bidirectional Health Information Exchange.
Nevertheless, in our August 2015 report, we noted that the IPO had
not specified outcome-oriented metrics and goals that could be used to
gauge the impact of the interoperable health record capabilities on the
departments' healthcare services. At that time, the acting director of
the IPO stated that the office was working to identify metrics that
would be more meaningful, such as metrics on the quality of a user's
experience or on improvements in health outcomes. However, the office
had not established a timeframe for completing the outcome-oriented
metrics and incorporating them into the office's guidance.
In the report, we stressed that using an effective outcome-based
approach could provide the two departments with a more accurate picture
of their progress toward achieving interoperability, and the value and
benefits generated. Accordingly, we recommended that the departments,
working with the IPO, establish a timeframe for identifying outcome-
oriented metrics; define related goals as a basis for determining the
extent to which the departments' modernized electronic health record
systems are achieving interoperability; and update IPO guidance
accordingly.
Both departments concurred with our recommendations. Further, since
that time, VA has established a performance architecture program that
has begun to define an approach for identifying outcome-oriented
metrics focused on health outcomes in selected clinical areas, and it
also has begun to establish baseline measurements. We intend to
continue monitoring the department's efforts to determine how these
metrics define and report on the results achieved by interoperability
between the departments.
VA's Plan to Modernize VistA Raises Concern about Duplication with
DOD's Electronic Health Record System Acquisition
Following the termination of the iEHR initiative, VA moved forward
with an effort to modernize VistA separately from DOD's planned
acquisition of a commercially available electronic health record
system. The department took this course of action even though it has
many healthcare business needs in common with those of DOD. For
example, in May 2010, VA (and DOD) issued a report on medical IT to
Congressional committees that identified 10 areas--inpatient
documentation, outpatient documentation, pharmacy, laboratory, order
entry and management, scheduling, imaging and radiology, third-party
billing, registration, and data sharing--in which the departments have
common business needs.\11\ Further, the results of a 2008 study pointed
out that over 97 percent of inpatient requirements for electronic
health record systems are common to both departments.\12\
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\11\ Department of Defense and Department of Veterans Affairs Joint
Executive Council and Health Executive Council, Report to Congress on
Department of Defense and Department of Veterans Affairs Medical
Information Technology, required by the explanatory statement
accompanying Department of Defense Appropriations Act 2010 (Public Law
111-118).
\12\ Booz Allen Hamilton, Report on the Analysis of Solutions for a
Joint DOD-VA Inpatient EHR and Next Steps, Task Order W81XWH-07-F-0353:
Joint DOD-VA Inpatient Electronic Health Record (EHR) Project Support,
July 2008.
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We also issued several prior reports regarding the plans for
separate systems, in which we noted that the departments did not
substantiate their claims that VA's VistA modernization, together with
DOD's acquisition of a new system, would be achieved faster and at less
cost than developing a single, joint system. Moreover, we noted that
the departments' plans to modernize their two separate systems were
duplicative and stressed that their decisions should be justified by
comparing the costs and schedules of alternate approaches.\13\
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\13\ GAO, Electronic Health Records: VA and DOD Need to Support
Cost and Schedule Claims, Develop Interoperability Plans, and Improve
Collaboration, GAO-14-302 (Washington, D.C.: Feb. 27, 2014). See also
GAO, 2014 Annual Report: Additional Opportunities to Reduce
Fragmentation, Overlap, and Duplication and Achieve Other Financial
Benefits, GAO-14-343SP (Washington, D.C.: Apr. 8, 2014), and 2015
Annual Report: Additional Opportunities to Reduce Fragmentation,
Overlap, and Duplication and Achieve Other Financial Benefits, GAO-15-
404SP (Washington, D.C.: Apr. 14, 2015).
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We recommended that VA and DOD develop cost and schedule estimates
that would include all elements of their approach (i.e., modernizing
both departments' health information systems and establishing
interoperability between them) and compare them with estimates of the
cost and schedule for developing a single, integrated system. If the
planned approach for separate systems was projected to cost more or
take longer, we recommended that the departments provide a rationale
for pursuing such an approach.
VA, as well as DOD, agreed with our recommendations and stated that
an initial comparison had indicated that the approach involving
separate systems would be more cost effective. However, as of June
2016, the departments had not provided us with a comparison of the
estimated costs of their current and previous approaches. Further, with
respect to their assertions that separate systems could be achieved
faster, both departments had developed schedules which indicated that
their separate modernization efforts are not expected to be completed
until after the 2017 planned completion date for the previous single-
system approach.
VA Has Begun to Implement VistA Modernization Plans amid Uncertainty
about Its Approach; the Department Is Currently Reconsidering How to
Proceed
As VA has proceeded with its program to modernize VistA (known as
VistA Evolution), the department has developed a number of plans to
support its efforts. These include an interoperability plan and a road
map describing functional capabilities to be deployed through fiscal
year 2018. Specifically, these documents describe the department's
approach for modernizing its existing electronic health record system
through the VistA Evolution program, while helping to facilitate
interoperability with DOD's system and the private sector. For example,
the VA Interoperability Plan, issued in June 2014, describes activities
intended to improve VistA's technical interoperability,\14\ such as
standardizing the VistA software across the department to simplify
sharing data.
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\14\ Technical interoperability refers to the ability of multiple
systems to be able to transmit data back and forth.
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In addition, the VistA 4 Roadmap, last revised in February 2015,
describes four sets of functional capabilities that are expected to be
incrementally deployed during fiscal years 2014 through 2018 to
modernize the VistA system and enhance interoperability. According to
the road map, the first set of capabilities was delivered by the end of
September 2014 and included access to the Joint Legacy Viewer and a
foundation for future functionality, such as an enhanced graphical user
interface and enterprise messaging infrastructure.
Another interoperable capability that is expected to be
incrementally delivered over the course of the VistA modernization
program is the enterprise health management platform.\15\ The
department has stated that this platform is expected to provide
clinicians with a customizable view of a health record that can
integrate data from VA, DOD, and third-party providers. Also, when
fully deployed, VA expects the enterprise health management platform to
replace the Joint Legacy Viewer.
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\15\ The enterprise health management platform is a graphical user
interface that is intended to present patient information to support
medical care to the veteran from a standardized set of information,
regardless of where the veteran receives care. Clinical information
captured at the point of care is made available to all authorized
providers across the enterprise.
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However, a recent independent assessment of health IT at VA
reported that lengthy delays in modernizing VistA had resulted in the
system becoming outdated.\16\ Further, this study questioned whether
the VistA Evolution program to modernize the electronic health record
system can overcome a variety of risks and technical issues that have
plagued prior VA initiatives of similar size and complexity. For
example, the study raised questions regarding the lack of any clear
advances made during the past decade and the increasing amount of time
needed for VA to release new health IT capabilities. Given the concerns
identified, the study recommended that VA assess the cost versus
benefits of various alternatives for delivering the modernized
capabilities, such as commercially available off-the-shelf electronic
health record systems, open source systems, and the continued
development of VistA.
---------------------------------------------------------------------------
\16\ Independent Assessment of the Health Care Delivery Systems and
Management Processes of the Department of Veteran Affairs, Integrated
Report (Sept. 1, 2015).
---------------------------------------------------------------------------
In speaking about this matter, VA's Under Secretary for Health has
asserted that the department will follow through on its plans to
complete the VistA Evolution program in fiscal year 2018. However, the
Chief Information Officer has also indicated that the department is
taking a step back in reconsidering how best to meet its electronic
health record system needs beyond fiscal year 2018. As such, VA's
approach to addressing its electronic health record system needs
remains uncertain.
In summary, VA's approach to pursuing electronic health record
interoperability with DOD has resulted in an increasing amount of
standardized health data and has made an integrated view of that data
available to department clinicians. Nevertheless, a modernized VA
electronic health record system that is fully interoperable with DOD's
system is still years away. Thus, important questions remain about when
VA intends to define the extent of interoperability it needs to provide
the highest possible quality of care to its patients, as well as how
and when the department intends to achieve this extent of
interoperability with DOD. In addition, VA's unsuccessful efforts over
many years to modernize its VistA system raise concern about how the
department can continue to justify the development and operation of an
electronic health record system that is separate from DOD's system,
even though the departments have common system needs. Finally, VA's
recent reconsideration of its approach to modernizing VistA raises
uncertainty about how it intends to accomplish this important endeavor.
Chairman Kirk, Ranking Member Tester, and members of the
subcommittee, this concludes my prepared statement. I would be pleased
to respond to any questions that you may have.
Senator Kirk. Thank you. Dr. Thompson, we will hear your
statement.
DEPARTMENT OF DEFENSE
STATEMENT OF DR. LAUREN THOMPSON, DIRECTOR, DOD/VA
INTERAGENCY PROGRAM OFFICE
Dr. Thompson. Chairman Kirk and Ranking Member Tester,
thank you for the opportunity to address the Subcommittee on
Military Construction and Veterans Affairs. I am honored to
represent the Department of Defense and Department of Veterans
Affairs as Director of the DOD/VA Interagency Program Office,
or IPO.
As part of the current strategy to achieve the President's
goal of electronic health record interoperability and
modernization, the IPO was re-chartered in 2013 to serve as the
single point of accountability for identifying, monitoring, and
improving the health data standards to create seamless
integration of health data between the DOD, the VA, and private
healthcare providers.
Health data interoperability is essential to improving the
care delivered to our servicemembers, veterans, and their
beneficiaries. Working closely with the Office of the National
Coordinator for Health Information Technology (ONC) and
standards development organizations, the IPO helps identify,
implement, and map the appropriate national standards
associated with both Departments' electronic health record
systems.
Assisting the Departments with their interoperability and
modernization milestones, the IPO serves as a central resource
as DOD and VA develop, adopt, and update a technical framework
that is clinically driven to align identified standards with
approved use cases.
To that end, the IPO monitors industry best practices and
provides technical guidance to facilitate data interchange
between the Departments. We also serve as a conduit for the
Departments' engagement with ONC and standards development
organizations to facilitate knowledge sharing on a national
level.
We have been integrated into ONC's planning for a national
health IT ecosystem and we are key contributors in the
development of ONC's nationwide interoperability roadmap that
seeks to advance nationwide health IT.
The IPO also plays an important role in monitoring the
progress that DOD and VA continue to make in enhancing their
interoperability efforts. Specifically, we have established a
health data interoperability metrics dashboard to identify
Department-specific targets for transactional metrics and
trends.
In addition to these efforts, last year the Government
Accountability Office recommended that DOD and VA adopt outcome
oriented metrics to provide a basis for assessing and reporting
on the progress of the Departments' interoperability efforts.
We concurred with GAO's guidance, and I am pleased to report
that we have made substantial progress addressing the
recommendations.
Specifically, we have been working closely with ONC, DOD,
VA, and other public and private partners to develop outcome
oriented metrics that not only measure the impact
interoperability has on healthcare but specifically focuses on
the impact interoperability has on patients and providers.
The IPO is fully committed to assisting DOD and VA as they
continue to enhance health data interoperability between their
electronic health record systems and the private sector, which
will serve as the foundation for a patient-centric healthcare
experience, seamless care transition and improved care for our
servicemembers, their families, and our veterans.
Again, thank you for the opportunity today, and I look
forward to your questions.
[The statement follows:]
Prepared Statement of Dr. Lauren Thompson
Chairman Kirk and Ranking Member Tester, thank you for the
opportunity to address the Subcommittee on Military Construction and
Veterans Affairs. I am honored to represent the Departments of Defense
and Veterans Affairs as the Director of the DOD/VA Interagency Program
Office (IPO).
As part of the current strategy to achieve the President's goal of
electronic health record interoperability and modernization, the IPO
was rechartered in 2013 to serve as the single point of accountability
for identifying, monitoring, and approving the health data standards to
create seamless, integration of health data between DOD, the VA, and
private healthcare providers.
As you know, DOD and VA are two of our Nation's largest healthcare
systems, and share more health data than any two other major systems.
Currently, the Departments share more than 1.5 million data elements
daily, and more than 100,000 DOD and VA clinicians are able to view the
real-time records of the more than 7 million patients who have received
care from both Departments.
Health data interoperability is essential to improving the care
delivered to our servicemembers, veterans, and their beneficiaries.
Working closely with the Office of the National Coordinator for Health
Information Technology (ONC) and Standards Development Organizations,
the IPO helps identify, implement, and map the appropriate national
standards associated with both Departments' electronic health record
systems. These steps are vital and provide the building blocks
necessary for the Departments to achieve health data interoperability
as required by the fiscal year 2014 National Defense Authorization Act.
In fact, earlier this year the Departments met this requirement and
provided certification to Congress that their systems are interoperable
with an integrated display of data.
The IPO is a collaborative entity, comprised of staff from both
Departments with technical expertise in health data standards and
information sharing. Assisting the Departments with their
interoperability and modernization milestones, we serve as a central
resource as DOD and VA develop, adopt, and update a technical framework
that is clinically driven to align identified standards with approved
use cases. To that end, the IPO monitors industry best practices and
provides technical guidance to facilitate data interchange between the
Departments. We also serve as a conduit for the Departments' engagement
with ONC and Standards Development Organizations to facilitate
knowledge sharing on a national level; we have been integrated into
ONC's planning for a national health IT ecosystem, and were key
contributors in the development of ONC's Interoperability Roadmap that
seeks to advance nationwide IT interoperability.
The IPO also plays an important role in monitoring the progress
that DOD and VA continue to make in enhancing their interoperability
efforts. Specifically, we have established a Health Data
Interoperability Metrics Dashboard to identify Department-specific
targets for transactional metrics and trends. We share this and much
more information with Congress in our quarterly Data Sharing Reports
and regular briefs with Committee staff. In addition to these efforts,
last year, the Government Accountability Office (GAO) recommended that
DOD and VA adopt outcome-oriented metrics to provide a basis for
assessing and reporting on the progress of the Departments'
interoperability efforts. We concurred with GAO's guidance and I am
pleased to report that we have made substantial progress to address
this recommendation. Specifically we have been working closely with
ONC, DOD, VA, and other public and private partners to develop outcome-
oriented metrics that not only measure the impact interoperability has
on healthcare but specifically focus on the impact interoperability has
on our patients and providers.
The field of health data is constantly evolving. For the
Departments to maintain and enhance the interoperability of their
electronic health record systems, we must continue our collaboration
with ONC and industry partners to ensure that DOD and VA map their data
to the latest national standards, and that ONC and the private sector
can continue to learn from our experience.
The IPO is fully committed to assisting DOD and VA as they continue
to enhance health data interoperability between their electronic health
record systems and the private sector. Enabling health information
exchange between EHR systems in DOD, VA, and the private sector will
serve as the foundation for a patient-centric healthcare experience,
seamless care transitions, and improved care for our servicemembers,
their families, and our veterans. As IPO Director, I am happy to answer
any questions you may have on the IPO and work of DOD and VA to
identify and adopt health data standards.
Again, thank you for this opportunity, and I look forward to your
questions.
Senator Kirk. Thank you. Let me start with questions. I
will ask LaVerne, since you have been in office for about a
year now, and coming out of J&J and Dell Computer, can you give
me your first impressions when you came into the VA IT
business?
CIO COUNCIL IMPRESSION OF VA IT
Ms. Council. Thank you for the question. I think one of the
biggest surprises was the lack of an integrated data management
capability, which I think is critical to being able to share
the right information, have the right analytics, and be able to
disseminate the information out to everyone.
Also, the number of custom systems, having well over 800
different applications out, that tends to be a fairly high
number, and most organizations might have a few but not that
many, and also the age of those systems was also something that
was surprising to me.
In addition, not having a program or project management
office.
OVER 800 VA APPLICATIONS
Senator Kirk. Let me interrupt you to make a key point.
What you are telling the committee is you have several hundred
customization projects underway to current software that would
make you one of the largest software development operations in
the country right there at VA, not a core competency for you
guys.
Ms. Council. Most of the work is managed by contractors, to
your point, we have about 218 projects going on right now, and
the level of customization is a concern because it does make it
harder to maintain those systems.
Senator Kirk. Thank you.
Ms. Council. Thank you.
Senator Kirk. Over to you.
INTEROPERABILITY AND ENTERPRISE HEALTH MANAGEMENT PLATFORM
Senator Tester. Thank you, Mr. Chairman. Thank you all for
your testimony. Secretary Council, you mentioned in your
testimony that deployment of the Joint Legacy Viewer (JLV) has
been a major step towards interoperability. As you well know,
this is a read-only application, and we know the enterprise
health management platform (eHMP) will eventually be a
replacement, and it will bring more capabilities to add to the
record, I would assume.
On April 8, you jointly certified with the DOD
interoperability. Could you tell me, number one, how
interoperability will be improved as you implement the
enterprise health management platform?
Ms. Council. Thank you for the question. I will start and
then I will pass it over to Mr. Waltman to add some more parts
to it. Clearly, being able to certify interoperability of the
JLV was exciting. We have to date 178,000 users of the JLV
today. We have used it to support about 7 million different
intentions, and going forward, the eHMP is going to augment it.
David, if you want to share some information, that would be
great.
Mr. Waltman. Thank you, Ms. Council, Senator. The
enterprise health management platform is a great opportunity
for us to build on the interoperable information exchange base.
Senator Tester. I got you. Let me cut right to it, because
my time is going to be limited. Right now----
INTEROPERABILITY DEFINITION
Senator Kirk. We are getting to the heart of this hearing,
would you please define ``interoperability'' as you understand
it from the NDAA?
Mr. Waltman. Yes, Mr. Chairman. The NDAA required us to
have an exchange of all health record information between the
two departments.
Senator Kirk. I will read to you Webster's definition of
``interoperability.'' Interoperability is ``The ability of a
system to work with and use another system.''
Mr. Waltman. Understand.
Senator Kirk. In the case of the Joint Legacy Viewer, which
is kind of a kludgy Band-Aid that we have. When I talked to
Cerner, they told me it does not provide the x-ray data of a
patient, so we would say now welcome to the VA, we have no x-
ray data on you from all the x-rays, the Navy, the Army, Air
Force did for you.
Mr. Waltman. Yes, Mr. Chairman. Agree and understand that
definition.
Senator Kirk. I think most members of this committee would
say that is not interoperable.
Mr. Waltman. Understand. I think that----
JOINT LEGACY VIEWER AND IMAGING ISSUES
Senator Kirk. What about CAT scans?
Mr. Waltman. Right. The data that we are exchanging now is
all of the health record data, which includes 25 domains of
standardized data where standards exist, so that includes
progress notes, lab reports. It includes the reports from all
of those imaging studies.
As we know, the size of data for the studies themselves is
exponentially larger than----
Senator Kirk. If we had a veteran who had a spot on his
lung indicating cancer, the Joint Legacy Viewer would not share
that with the VA so VA would not know about that emerging
cancerous situation, is that correct?
Mr. Waltman. I think Dr. Nebeker may be able to answer this
question in a clinically precise way, but I would say there
would be a radiology report from the study that was done
identifying the spot, and that report is available today.
Senator Kirk. This is a narrative thing?
Mr. Waltman. That is correct.
Senator Kirk. I am actually talking about the imagery.
Mr. Waltman. Right.
Senator Kirk. Most people would think that a medical record
includes x-rays that they had taken when they were in the
service.
Mr. Waltman. Yes, and that is certainly part of the medical
record, and the report that the radiologist completes after
such imaging studies are done are what other providers
typically use to address findings from those reports and follow
their course of care.
That said, we are working and in the process now of
delivering the image viewer component of the Joint Legacy
Viewer, which will be available in the next release, and now
the challenge there is to make sure that we have the bandwidth
and ability to exchange the images when they are needed to be
exchanged for clinical purposes.
I think the point was that we wanted to ensure we have
interoperability and exchange of all the clinically relevant
information, so Dr. Nebeker, you may want to make a comment
about images and reports and their relevance.
Dr. Nebeker. Images are critical to the provision of
medicine. In most cases the narrative is the most important
part of that because as people are planning operations or
leading up to an operation or planning treatment, most of us--I
am a geriatrician and primary care provider as well as a
consultant, I usually rely on the interpretation because I am
not expert in all the various domains of radiology to make
those types of calls.
Definitely for many types of operations, it is critical to
have the images, so we agree with your statement.
For the interoperability, certification of
interoperability, there was fairly clear instruction in the
statute and also in the response, and Ms. Thompson may be able
to take this on a little bit more, but interoperability is a
concept. You brought up the dictionary. It is really critical
to have use cases about what are the problems we are trying to
solve with interoperability.
Clinicians, between VA and DOD, jointly developed a number
of use cases, and the conditions for interoperability were
meant for those use cases. Ms. Thompson, if you would like to
elaborate.
Senator Kirk. This is the only subcommittee that has joint
jurisdiction of both DOD and VA, so we are the only guys that
can really ride herd on something like bringing you two
together, DOD and VA together.
Senator Tester. I just want to continue real quick. I
actually am going to be very interested to hear Dr. Cassidy's
questions on this because you are in the business.
You were asked a question and your response was what we are
trying to solve here, what we are trying to solve here is not
have to rewrite the book again. Quite frankly, where the person
was hurt, how the person was hurt, the x-rays, the CAT scans,
all that would be on there so that when a veteran is going to
get rated, it would be a much easier process, and it would not
take forever, and it would not be like a very complicated math
problem. It would be right there.
The information has to be there. It is interesting that you
would say the notes are more important than the pictures. I am
not a doctor, but do you ever do a surgery and not look at
pictures of the x-rays and that kind of stuff? You just start
cutting based on notes?
Dr. Nebeker. Yes, sir, I completely agree that for
operations the pictures are critical.
FULL INTEROPERABILITY TIMETABLE
Senator Tester. Okay, good. The question is when and at
what point in time are we going to be interoperable to the
point where the information that the DOD has, and by the way,
if it is not good information coming to you, you do not have
good information, but assuming they give you the information,
you will have all the information on those medical records in
your hands, when is that going to happen?
Ms. Council. The image viewer is going into deployment to
get these images moved into the JLV----
Senator Tester. When does that happen?
Ms. Council. September of this year.
Senator Tester. You will have access to x-rays, CAT scans?
Ms. Council. Of the records that are in JLV, yes. In
addition, I think it goes one step further, and the one step
further is why I think enterprise data management is so
important. You are both 100 percent correct.
We have to have seamless movement of that information from
DOD as far as I am concerned at the Active Duty point of the
enlisted person, even knowing before they become a veteran, and
we have to work on that. That is one of the reasons that the
enterprise level is so important versus just having a pipe that
is only health.
Remember, there is much more to the veteran than just their
healthcare. It is their benefits, it is their ability to use
our National Cemetery System, it is all the things they have a
right to, education, and we have to do a much better job of
creating that seamlessness.
To your point, the semantic use of that information is that
information comes one to one, and the veteran does not have
anything to do to ensure that we have their data. That is the
most important thing and that is what we are striving for.
Senator Tester. I have got it. I have been here almost 10
years now, and I serve on the Senate Veterans' Affairs
Committee, as does Senator Cassidy, as does Senator Murray and
others, as well as Senator Boozman.
The very first meetings that I was at in Senate Veterans'
Affairs, we talked about interoperability between the DOD and
VA. That was in 2007. We are 10 years later. We have had
incredible advances in technology, just flying up through the
roof. Yet I still have the feeling----
JOINT LEGACY VIEWER LACKING ANALYTICS
Senator Kirk. If the Senator will suspend, I want to add on
to that. When I talked to Cerner this morning, they talked
about something that really addresses a key VA priority, which
is suicide prevention. I understand from the press we had the
suicide hotline that had not enough responses for people. One
of my constituents had called in and also committed suicide
after they called back.
The exciting thing for what Cerner told me was they had an
algorithm that could predict suicide likelihood. When I talked
to Cerner, they said the Joint Legacy Viewer cannot do
analytics like this.
David, you are nodding your head. This critical upgrade in
suicide prevention, they are not capable of doing with this
Joint Legacy Viewer.
Senator Tester. You talked about the images coming in in
September. When do you get to a point where you are satisfied
with the transfer of information being complete, to deal with
issues like the chairman said and others?
Mr. Waltman. Thank you, Senator. I was nodding my head
because I agree 100 percent, JLV is 100 percent incapable of
those analytics. JLV, of course, was----
ANALYTIC CAPABILITY
Senator Tester. Okay, I have you. When do we get to a point
where you are capable of those analytics?
Mr. Waltman. That is the enterprise health management comes
in, health management platform, and I will allude to the
concept of the digital health platform which Ms. Council has
talked about.
We need an integrated capability of all the clinical data
for process management, for managing clinical pathways,
clinical workflows, integrated with analytics which can use
algorithms such as described by the chairman, which can predict
based on the information in the record, based on pathways and
courses of action available, what interventions should be taken
and what the processes and care pathway should be.
Dr. Nebeker can talk in a little bit more detail about
clinically what that looks like.
Senator Tester. Do not have to do that. I asked you a
question, and the question was when are you going to be able to
do this. I am going to tell you I can filibuster you better
than you can filibuster me. The question is pretty clear, and
you are smart people. Tell me when you are going to be able to
achieve this level. That is it. Is it going to be next year, 5
years, 10 years, next month?
Mr. Waltman. 2018.
Senator Tester. 2018. January 1, 2018?
Mr. Waltman. The end of fiscal year, so middle of calendar
year 2018.
Senator Tester. When we have this hearing on July 15, 2018,
you are going to be totally interoperable, absolutely there is
going to be no gaps, the system is going to work?
Mr. Waltman. I would like to give a yes or no answer to
that question but I cannot. What I can tell you is that we will
have the ability to incorporate all of the information between
the Departments, to use it, process with the type of algorithms
that are being discussed, but I cannot say that every use case
that we may have identified for use of interoperable data will
be used.
Senator Tester. Thank you. Thank you, Mr. Chairman.
Senator Kirk. Mrs. Capito.
Senator Capito. Thank you, Mr. Chairman. I want to thank
all of you as well. I guess I am going to say I am a bit
confused because Secretary Council said that on April 8, you
were certified interoperable. Then Ms. Melvin said that an
interoperability system is still years away. I think that was
part of your statement.
Help me with those--that seems like a direct conflict
there. Are we talking about the same thing? How do I square
those two statements?
Ms. Council. I am going to try to simplify this and talk in
normal ease versus technical ease.
Senator Capito. Thank you. I am grateful for that.
Ms. Council. Let me start with the concept of a system. The
system, if you want to think about it, the inner workings, the
system, what all works together. The data is the artifact
coming out of the system, going into the system, and it
actually can sit separately from the system--data, system.
I think Ms. Melvin was referring to an engaged system,
being on the same system platform, and therefore, assuming
interoperability would be driven by being on the same system
platform.
SINGLE VA AND DOD EHR SYSTEM
Senator Capito. What is the objection of having a single
system, as she mentioned?
Ms. Council. The reality of a single system, in order for
you to ensure that you are going to drive the same level of
data out of that system is that you would have to sit on the
same instance, time of that system, not just the same name
system, but the same capabilities, no difference in that
system.
Senator Capito. Why can we not do that?
Ms. Council. The reality is there is no system that can
support both DOD and VA at the same time, it will not scale.
Senator Capito. We have Amazon that can scale.
Ms. Council. At the same time, there is no system that will
support all the things you have to do, the clinical management
and the clinical operations at the same time.
Senator Capito. Ms. Melvin, do you have any comment on
that?
FULL INTEROPERABILITY
Ms. Melvin. I would start by saying that we are not trying
to define what an interoperable system is for VA. We have been
looking at this over the years, and as has been discussed, the
question has been and what they have been working toward as we
understand it is a fully interoperable capability.
When we talk about fully interoperable, we are asking them
to define what they mean by the data exchange, what has to be
exchanged, what capabilities and to what extent. Those are
questions that have not been answered yet in terms of when you
talk about full interoperability, exactly what is it.
What kind of performance measures and metrics would you put
in place to know that you have gotten the full capability when
you get there.
Senator Capito. Excuse me. For the discussion on whether
your x-rays and tests and everything are a part of that, are
you including that as part of defining what
``interoperability'' is?
Ms. Melvin. Absolutely. It is understanding all of the
medical information, all of the systems that information would
have to come through, and what are they doing in the way of the
exchange capability, how will they know when all of the
information that they need to ensure that a patient's
healthcare is fully taken care of, how will they know when they
have gotten to that point or they have a system that gets to
that point.
We did encourage one system, and they in fact had stated
that one system was the way to go when they went with an
integrated electronic health record approach in 2011.
ONE SEAMLESS SYSTEM
Senator Kirk. I would say that they are coming up with two
different systems, and the only government bureaucracy that can
mandate one system--my preferred outcome would be since LaVerne
owns about 20 million patients and Dr. Waltman owns about 2
million patients, that it is only this committee that can
mandate a VA lead to make sure we have one seamless system.
PRIVATE PROVIDERS AND HEALTH INFORMATION EXCHANGE
Senator Capito. In my final 2 minutes, let me ask you, Dr.
Thompson, because you mentioned private sources, so we have
just created the Choice card, we now have our veterans going
out to private providers because of the issue of getting an
appointment timely, distance, all the things we know exist, and
this has been going on in the VA system for a while, but we
have expanded it by the Choice card, how is this going to be
interoperable with private providers? You have no guarantee.
I will just give you an example in my State, West Virginia,
we have a lot of issues with broadband deployment. We just
started a broadband caucus yesterday, I did, to meet this
issue. What do you anticipate in this area? That is my final
question.
Dr. Thompson. I can speak to DOD, and I would defer to Ms.
Council to speak for the VA. The DOD participates in what is
called the eHealth Exchange, which is a public/private
partnership of both government, including DOD, providers, and
private sector providers, providing data through health
information exchange organizations.
Senator Capito. Would you say your private providers are on
the same e-records as the DOD?
Dr. Thompson. For those providers that are participants in
eHealth Exchange, they do have access to the DOD data.
Senator Capito. There could be providers that were not on
the eHealth Exchange?
Dr. Thompson. Providers who are not presently on the
eHealth Exchange do not have access to that data.
Senator Capito. You could have an active military person go
to a private physician and they could not be on this eHealth
Exchange, and they would not have that data back at the DOD? Am
I hearing that correctly?
Dr. Thompson. That is correct presently. The DOD is moving
aggressively to increase the number of health information
exchanges and providers that are participants.
Senator Capito. This layers on a whole other issue.
Quickly.
Ms. Council. We do participate in HIE at the VA with over
1,500 of those in the United States. What that is is a
standardized data structure, and that is what I was getting to,
the data. At the end of the day, that is what you have to have
to be interoperable, and you need a standard across that.
Within the United States today, the standard is called
health information exchange or HIE, and we participate in those
HIEs as a way to engage that information today.
Senator Capito. Veterans using the Choice card could go to
a physician that is not in the health information exchange and
therefore, their records are not interoperable with you?
Ms. Council. What we do at the VA is if they go to a doctor
that is outside of our process, we will reach out to that
doctor and get that information one way or the other. If we can
get it electronically, we will get it.
One of the things about interoperability, and I just think
it is important to remember, it has a continuum. One part of
the continuum is non-electronic, which is how we moved things
before, I hate to say it, but it is paper. The other one is
called semantics, which is data flowing and data moving and
talking to each other.
We are on that continuum constantly, and healthcare has
been on that continuum constantly, moving to that standard
called HIE.
Senator Capito. Thank you.
Senator Kirk. With everybody's indulgence, I will do a
brief recess so we can make this vote. If you guys can hang
loose for a second, since we are paid by the vote here.
[Recess.]
Senator Tester. I am going to call the hearing back to
order. Thank you for your patience. Senator Udall has some very
important questions, and we will let him go.
APPOINTMENT SCHEDULING IMPROVEMENTS
Senator Udall. Thank you, Senator Tester. Thank you so
much, and thank you to all the witnesses for being here today,
we really appreciate your service to the country and service to
our veterans.
My first question revolves around the VA scheduling
scandal. Ms. Council, this question is on scheduling, an issue
that is critically important to the veterans in my State.
The VA Office of Inspector General recently released a
report related to the scheduling scandal from 2014
substantiating claims that the managers at the VA Medical
Center in Albuquerque abused scheduling software to manipulate
metrics and make it appear the wait times were shorter than
they actually were.
This is similar to the earlier reports of scheduling
mismanagement in at least seven other States, including
Illinois and Arizona.
The findings of this report confirmed allegations that the
schedule was rigged to make the center look better. That is
very troubling. Our veterans have earned the best care we can
provide, the appointment scandal showed a disturbing disregard
for health and safety of our heroes.
I have had a chance to discuss the report with the local
medical center director in Albuquerque. I appreciate that since
I raised these concerns the VA has taken several steps to
improve access to care and reduce wait times. That includes
extended hour and weekend clinics, same-day primary care
clinic, hiring additional staff, and expanding the use of
telemedicine.
However, I hear from VA employees and from veterans there
is still much work to do. What steps has the Office of
Information and Technology taken to eliminate opportunities to
game the system, and aside from changes in traditional
management practices and training, are there changes that can
be made in the software to increase accountability and ensure
that these work arounds are no longer possible?
Ms. Council. Thank you, Senator Udall, for the questions
and the background. We agree with you that this is the most
important thing, to make sure the veterans have access to the
care they need.
To your point, within the VSE product, there is a
capability to keep people from having to go in and change, it
tracks any change that could be made, and makes sure we can see
it.
In addition, there is a product we call Care Now, which is
a mobile access for the veteran, which will allow them to
actually schedule with a doc in real time, in a telemedicine
way, but on a mobile device. We are working with the doctors
now to put that into full test.
It was developed to allow the most capable way for the
veteran to get help whenever they need it, primarily around
mental health, but it could also be used for urgent care. It is
a quite nice interactive system. We look forward to sharing
that with you as we go forward, but our objective is to make it
as seamless and as easy for the veteran to engage.
In addition, their ability to make appointments using a
mobile device through a system called VAR, which you have also
heard about, which will allow them to request when they want to
come in, what date they want to come in, what time, based on
what is available.
Trying to put those things in their hands using technology
is core and key, but we are really excited about this Care Now
application.
Senator Udall. Thank you. One of the other things I wanted
to focus on is Federal information technology management. Many
of these problems are caused at least in part by legacy IT.
Ms. Council, I have been working in a bipartisan way with
Senator Moran, Senator Milkulski and others on the
Appropriations Committee. We want to improve the oversight of
how we spend over $80 billion annually on information
technology across the Federal Government.
At a hearing following the healthcare.gov Web site debacle,
we called for OMB to publish a top 10 list for the highest
priority IT investments across the government. We also called
for better OMB oversight of these IT projects.
According to the OMB, three of the Nation's highest
priority IT projects are at the Veterans Administration. The
first one, electronic health records/VistA; the medical
appointment scheduling system (MASS); and third, the Veterans
Benefit Management System (VBMS).
MEDICAL APPOINTMENT SCHEDULING SYSTEM
Ms. Council, I want to ask specifically about the new
medical appointment scheduling system, the scheduling
replacement project was terminated in September 2009 after
spending an estimated $127 million over 9 years.
What lessons has the VA learned from the failure of its
previous scheduling replacement project, which was terminated
at the cost I just noted?
Are you using agile or incremental development or best
Federal acquisition practices for the new medical appointment
scheduling system, and by what dates will the VA's three
highest priority IT projects be completed? The three that I
mentioned there, VistA, MASS, and VBMS.
Ms. Council. That was three questions, I want to make sure
I address them properly, sir. Upon arrival in 2015, the
question of scheduling was on point as what we were going to do
with that.
I am going to ask David to share where we are on the
scheduling process and also why we decided to do some of the
things we have done, because I think he can give the best feel
on that because he has been here.
THREE HIGH RISK VA DEVELOPMENT PROJECTS
On the three key projects, however, that you mentioned,
that was brought to my attention immediately upon arrival, that
VistA is a 40-year-old system, what we are doing on
modernization. The MASS project had just kicked in, and it was
all around the scheduling issue and trying to get this right
and what we were going to do against that.
The third area was VMBS, which is handling our claims
business and how we are going to make that work, and some of
the underlying parts of it, including the BDN system, which is
over 50 years old.
When you ask when all of those are going to get done, the
reality is you always are in a maintenance mode on any
sustained application. I would like to say you put them in and
never see them again, it is not true.
Applications always cost you, so you are always going to
have maintenance, you are always going to be doing patching,
you are always going to try to stay ahead of the cybersecurity
issues that come with day to day issues on applications.
As far as being done and the capability, I think the
reality for us as we talk about EHR and VistA in particular,
there are new capabilities that have to be added.
I think the team went forward with an honest and open
process for trying to decide what those could be, but we all
know we are not able to move fast enough, and did not move fast
enough to keep it up to speed where it needs to be, and that is
why we are talking about a new platform called the digital
health platform.
MASS AND SCHEDULING
On MASS and scheduling, David, if you would give the
Senator some of the dates on those.
Mr. Waltman. Thank you. Senator, the question about MASS
comes back to what Ms. Council referred to in talking about the
digital health platform. We made an award of the MASS contract
last fall.
That was very soon after Ms. Council and Dr. Shulkin
arrived, and under their leadership, we had to look at the
bigger picture and whether VistA in the go forward plan made
sense.
Since MASS was to be integrated with VistA, with a specific
COTS product and had a lot of expense and overhead to do that,
while determining what our path forward was, the decision was
made to pause MASS.
We have worked since then with the VistA scheduling
enhancements, which Ms. Council mentioned, which allows us to
do some of the things, auditing, lock down clinical indicated
data, things like that, and we are currently working to
complete that and have it deployed and is being piloted in
three sites right now.
The answer to when MASS will be completed is there is not a
completion date determined for that because in the context of
discussing our EHR way forward and a commercial off-the-shelf
system, we have to consider whether we need to address
scheduling in that context or separately.
Senator Udall. Thank you very much, and thank you for your
courtesies, Mr. Chairman.
Senator Kirk. Dr. Cassidy.
COMPREHENSIVE DEFINITIONS FOR ALL DATASETS
Senator Cassidy. First, thank you for that reply, just so
it is on the record. I learned from you earlier that VistA--VA
is upgrading the VistA system but will eventually replace it
with a commercial product.
I know from staff an RFI has been put out, a request for
information, to understand what the commercials can do in terms
of capabilities for the VA. You have mentioned the enterprise,
just for context.
My head was turned around just for a little bit. One of the
issues that has been raised for semantic interoperability is
comprehensive definitions of all the datasets.
If we wish the VA system and the DOD system to one, talk
with one another, and two, talk with providers who are outside
your system, has the DOD and VA established a common set of
comprehensive semantic definitions? That is my first question
to Ms. Thompson, I suppose, and Assistant Secretary Council,
and maybe Ms. Melvin.
Ms. Council. I will pass this over to Dr. Thompson.
Dr. Thompson. Thank you for the question. The IPO's role is
in working with the DOD and VA for that express purpose. We
work with the Office of the National Coordinator and standards
development organizations to determine the health data standard
that the two Departments should implement in their systems, and
we work with them presently through a process of mapping to
those standard definitions to ensure that the systems in place
in the departments comply with those----
Senator Cassidy. Yes or no, because that is a lot of
``we's.'' Yes or no, you have established a comprehensive set
of semantic definitions or no, but we are working to do so, and
are committed to doing so prior to the letting of the contract,
and these are or are not compatible with those who might be
outside the system but yet providing for those within?
Dr. Thompson. Yes, sir, we have established those
definitions.
Senator Cassidy. You have established those definitions?
Thank you. These are common as well with the non-DOD/VA
providers?
Dr. Thompson. That is correct.
APPLICATIONS FOR FUTURE DIGITAL HEALTH PLATFORM
Senator Cassidy. Secondly, for the DOD, are you all
requiring--I believe Cerner is your vendor or one of your two
vendors for your EHR, and do you require them to publish their
APIs, and do you require they allow plug and play of any future
app that might be developed that would allow someone to again
put in their blood pressure monitor at home into the EHR, so I
guess two questions there.
One, do you require them to publish the API, and two, do
you require them to do plug and play, and three, if you do
require them, do you require them to do it at a reasonable
cost?
Dr. Thompson. If I may take those questions for the record,
that program falls outside of my particular domain. I would
want to make sure I am providing you with the correct
information.
[The information follows:]
Unrestricted publishing of APIs is not required; however, the
contract provides for all rights necessary to operate, maintain and
sustain the EHR system solution; modify interfaces; perform
cybersecurity and software assurance; and, train on the EHR system
solution, including disclosure within or outside of the Government as
necessary to perform these functions.
The contract contains requirements for the integration of future
health IT applications or modules, as ordered by the Government once
any such applications or modules are identified as requirements by the
functional community. Further, in order to simplify the integration of
possible future applications, the contract requires adherence to
modular open system architecture design and development approaches.
Finally, all negotiations are conducted in accordance with FAR 15.4
which requires establishing the reasonableness of offered prices.
Senator Cassidy. The VA, and in your RFP, because I am sure
you are already thinking about it, again, are you going to
require whichever vendor wins to publish the API because for
some, it is not proprietary?
I have also been told they effectively limit plug and play
even if somebody comes up with a lower cost app, and they limit
it by basically charging so much to come up with a custom
design to allow the plug that they effectively eliminate the
ability to develop plug and play, so my question there.
Ms. Council. Our recommendation for a digital health
platform is that it is all open source and we be able to move
in and out of the platform.
Senator Cassidy. Again, they will be required to publish
their APIs as part of the RFP? I see Dr. Nebeker nodding yes.
Ms. Council. Yes, that is the expectation of our digital
platform. We are asking for what is not done today because we
feel it needs to be open. That is part of how you drive
innovation, and that will be the best way to ensure that we
have full interoperability.
Senator Cassidy. That is good. I have also understood that
under your current VistA platform that one of the problems is
that each VISN has done a customization of the VistA program
for their VISN.
Indeed, VISN 16 does not necessarily communicate with VISN
10 because they have both been customized, you can tell they
are related, but they are first cousins, they are not one and
the same.
Ms. Council. Yes, there are 130 plus and distinct instances
of VistA within the VHA today.
Senator Cassidy. So, the modernization process, are you
just going to kind of okay, we have to tolerate that until we
replace, or are you attempting to reconcile that?
Ms. Council. I think some of the modernization--I will pass
this on--I think much of the modernization is to ensure safety,
health, and the clinical side to assure we are capturing the
things we need to, just to keep the system whole.
Also, there is security, things we want to make sure the
system has the capability to do that might not have been
thought about 40 years ago. David, if you would like to share
some of the other modernization efforts.
Mr. Waltman. Yes, thank you. A key part of the
modernization work that we are doing now that will continue
into 2018 with the enterprise health management platform is to
federate that information from those 130 VistA instances, as we
just talked about, because you are right----
Senator Cassidy. ``Federate'' implies to me they are
allowed to continue to have their own domain.
Mr. Waltman. Until we move to a COTS solution on the
digital health platform, there is not an intention to collapse
all of those instances into one because of time, cost, and
complexity.
Senator Kirk. Let me just jump in and have you formally
define ``federate.''
Mr. Waltman. ``Federate'' means that we take all of the
health information from those VistAs and bring it into one
place so it can be used together. That is what the DHP does.
It also allows us--we have a software development kit to do
exactly what you just described, exposing the APIs, people are
able to write and provide apps into the platform using that
collected, assembled federated data.
DIGITAL HEALTH PLATFORM
Ms. Council. But to avoid this problem of multiple
instances in the future, that is the recommendation, a digital
health platform, that we can keep it on one instance, one
capability, one solution, and everybody has to come to it. The
fact is that 130 is what makes it slow, makes it cumbersome,
makes it take a long time, and it makes it inconsistent.
To your point, moving to an open architecture that allows
APIs to come in, allows us to use that information, share it,
and get it back out and do it in a much more seamless area is
where we want to go with DHP.
Senator Cassidy. I am also told that Cerner has DOD, let's
imagine even that Cerner gets VA, as it turns out now, if you
have one hospital at Cerner and another hospital with Cerner or
Epic and Cerner, there is information blocking. Whether it is
because of technological challenges or because of a proprietary
instinct is a subject of debate, but nonetheless, it occurs.
What are you all doing in your RFI or RFP to ensure that we
will not end up with let's just say technological information
blocking?
OPEN SOURCE APPLICATIONS
Ms. Council. The recommendation that we are making is that
is not part of our process, and it will have to be
interoperable and have to be open source.
This is an IT recommendation, it is so unusual because we
are asking for software as a service component, which changes
the way that works, and we are also saying that we would have
that level of interoperability, to give you an example, you go
in and you fill a prescription at Walgreens, and then you go
and you try to fill that same prescription at Rite Aid, it is
very hard for you to do it because they have to go get the
information.
What we are saying is that would not be the case because
they are all based on the same information about you, so they
would each see that prescription.
GAO SKEPTICISM ON VA'S ASSERTIONS
Senator Cassidy. I am taking more time and I apologize, but
I want to ask one more question. Ms. Melvin, I was so struck by
your skepticism, so we have heard the vision for the VISNs.
Nonetheless, it seems as if you are skeptical. Were you
skeptical about the VistA product, coordinating outside of VA,
are you skeptical about the VA itself and their vision of a
commercial product being able to coordinate outside of VA?
Ms. Melvin. The questions that we raised really deal with
the fact that we have not seen clear planning across VA and DOD
relative to what they are trying to achieve.
Senator Cassidy. Let me ask, would you agree with the
statement that they have worked out a comprehensive set of
semantic definitions?
Ms. Melvin. We understand they have from what they say. We
are still obtaining information from them. We know they have
identified some of the standards that they need. We have not
seen other aspects of what they intend to do in terms of
putting either the interoperable component together for their
systems, between VA and DOD, or the planning that is necessary
for VistA modernization.
One of the things----
Senator Cassidy. Can I ask, have they committed to you a
date on which they will provide that information?
Ms. Melvin. No, we do not have dates yet.
Senator Cassidy. That seems like a follow up for our
committee, that we would also obtain that information because
that seems like one of the key issues here, correct? I am
sorry, continue.
Ms. Melvin. One of the points I would make in going back to
a statement earlier from Ms. Council where she was saying that
they have not identified one system that is large enough to fit
their needs, this is the kind of assertion that we would like
to see, and that we think it is important for them to have the
analysis and the transparency as to why a particular
alternative is not sufficient for their needs.
It kind of goes to the overall concern that we have in
terms of analysis, planning, looking at the alternatives, and
what the departments have in fact done that support where they
tend to be at this time, and then of course, the specifics for
what it is they are trying to achieve, and how they will know
when they get there.
Senator Cassidy. You have been very generous with your
time, thank you, Mr. Chairman.
Senator Kirk. Thank you. Mr. Boozman.
VA'S PLANNING FOR THE EHR FUTURE
Senator Boozman. Thank you, Mr. Chairman. Thank you so much
for having the hearing. Can somebody respond to Ms. Melvin's
concern about the clear planning?
Ms. Council. Yes, I can. She is 100 percent correct in what
you need to do to provide the kind of background information,
and one of the things that we have done with this
recommendation is talk to industry leaders including Gardner
Medical, very large medical organizations, as well as the KLAS
Group, which is known as the premiere organization for EHR, and
they are actually working with us to help us build that
business case, look at the various options.
We have a 200-page document which they have gone through
and explained to us from the industry perspective on what is
out there in COTS, how well they have been received. They
talked to over 2,300 providers in these areas about what they
are developing, so we are leveraging an independent view as to
what makes sense and what will make sense for us, and why
certain things do and certain things do not.
Our objective is by the end of this year we will have a
business case that the next administration or whomever is there
has real data based on an independent group to understand
exactly why we made the decisions we did.
ELECTRONIC HEALTH RECORDS AVAILABLE TO JLV
Senator Boozman. Thank you, Ms. Council. I would like to go
back to a previous discussion that I did not quite understand.
You mentioned the image viewer would go on line this September
for those records that are in the JLV. Which records are not in
the JLV, and who are you missing?
Mr. Waltman. Thank you, Senator. All electronic health
records that have been generated in the VA or since DOD has had
electronic health records are available and accessible for JLV.
That includes anything that would be in AHLTA, for example, on
the DOD side, records from back to----
Senator Kirk. David, I will interrupt you since you used
the term ``AHLTA,'' that is the data processing system for DOD.
Mr. Waltman. Correct.
Senator Kirk. When I was at Walter Reed, the doctors and
nurses said that stood for okay, let's all try again.
Mr. Waltman. I will not comment on that. The point is not
all records that exist for every veteran are electronic, some
veterans' records predate the electronic record era. The
records that are electronic are in JLV. The images are in a
separate image store in both the DOD and the VA, and that is
the viewer that is going to allow those to be seen that we are
speaking of.
Ms. Council. Lauren, did you have anything you wanted to
add from a DOD point of view?
Dr. Thompson. No, I think that was an excellent summary.
Thank you.
INDIVIDUAL SERVICE RECORDS
Senator Boozman. Good, that is helpful. I was pleased to
hear about the VA's goals with the electronic management
platform, particularly with the proposed inclusion of the
veteran's service history to include duty stations and type of
work they performed during their service, which is really
important.
I would like to get a better understanding of how this
would work in practice. As you know, servicemembers currently
face a very challenging transition from DOD to the VA.
When a servicemember separates from their Active Duty, the
information populating their DD-214 is not automatically made
available to the VA. It is the veteran's responsibility to make
sure the VA has the appropriate documentation in order to
verify their service and eligibility for VA benefits.
How would eHMP obtain the member's individual service
record?
Mr. Waltman. Thank you, Senator. At the present time, the
military history feature in the HMP is limited to being able to
have a place for information the veteran provides directly. As
you said, that is insufficient, and inadequate for seamless
care.
It is our desire that with what we have learned about
clinical record exchange, health information exchange, with
building JLV, that we will be able to work with our DOD
colleagues to get the electronic exchange of the service
history information and be able to feed that directly into the
platform.
Ms. Council. I think it is broader than just the
healthcare. When we look at the totality of the veteran, we are
looking at the whole veteran dataset, and our enterprise data
management process is putting that backbone across VHA, VBA,
NCA, so that way we have the whole look at the veteran, not
just pieces and parts, and also we want to mitigate the veteran
having to put information into various data marts as they have
to do today.
Senator Boozman. When do you anticipate the platform
happening?
Ms. Council. We are beginning that process this year,
laying out the architecture, bringing in leadership to guide
that, as well as we have set up a governance council so there
are data stewards across the organization that will be
responsible for that data, and veteran data will be owned and
responsible for our veteran experience team.
Senator Boozman. One of the problems that we have is making
sure the servicemember's history and data is accurate. What is
DOD doing in regard to that? What support would DOD be
providing?
Dr. Thompson. If I may, I would like to take that question
for the record to ensure I provide you with the correct
information. That falls outside of my immediate domain of
health data standards.
[The information follows:]
Joint Legacy Viewer (JLV) displays servicemember information
exactly as it's found in the authoritative system (Clinical Data
Repository (CDR), Composite Health Care System (CHCS), Essentris,
Theater Medical Data Store (TMDS), etc.). Accuracy is a critical factor
DOD tests thoroughly before each release. System Integration Testing
tests patient records in test authoritative data sources like the CDR.
The testers validate that the data in the disparate data sources
matches what is displayed in JLV. Further, the operational test report
also specifies that DMIX has information accuracy.
Senator Boozman. Good. Thank you, Mr. Chairman. We
appreciate you all being here. This is certainly something that
is frustrating in the sense that this has been going on for a
long time, and as you can tell, there is uniform frustration. I
know you all are frustrated, too, and working hard to get this
right.
Hopefully, we will be able to follow up in the near future
both in this committee and the Veterans' Committee, DOD, and
make sure that we are moving in the right direction. Thank you
very much.
Senator Kirk. Mr. Hoeven.
Senator Hoeven. Thank you, Mr. Chairman. Ms. Council, you
mentioned some of the challenges with your current scheduling
systems, specifically not having the capabilities to keep up
with the growing Care in the Community program.
In North Dakota, where there has been some challenges with
scheduling Veterans Choice appointments, currently the VA is
working to implement a pilot project in our State to bring the
scheduling aspect back to the VA, instead of relying on the
third-party administrator, which in our case is Health Net.
NATIONAL LEVEL IN-HOUSE SCHEDULING
My questions are does VA have the IT system in place to
accomplish in-house scheduling on a national level, if not,
when will we see an updated scheduling system in place that is
capable of managing Care for the Community appointments for
Veterans Choice, and what is your near and long-term goal of
modernizing your current scheduling system?
Ms. Council. The first part of that question relates to
Care in the Community, which is led by Dr. Yehia, and we are
very lock step on that because the Care in Community has a
bigger issue with the exchange, as I think you well understand,
Senator, so getting to where we can understand what appointment
is needed, helping the veteran to make their appointment with
the doctor, ensuring that the right referrals are happening,
all the things we are doing using the health interchange that
we mentioned prior to your arrival.
SCHEDULING SYSTEMS
The scheduling systems, David, I will refer those to you as
far as making sure we are straight on the timing and
deployment, but the objective was to put in what is called VSC,
which is a scheduler that is simpler than what our CPRS system
is, and I think that was really the core issue around
scheduling, it was convoluted, very difficult to understand.
What you are talking about with the veteran in the
community is how best we make sure we know when they want an
appointment, and today we are putting in a mobile capability
called VAR that will allow them to actually request on their
Smartphone or a call, if they have to, if they are not using
something electronic, so we could be much more responsive to
them.
This is something we are working on daily. As you know,
Choice has grown, and then figuring out exactly how to get
these hand shakes clear is something we are very committed to.
We have to do better. We have a lot more work to do there.
The Choice program and the scheduling program in general
are both under engagement, and we are now testing a new
scheduling capability in dual locations, looking to roll that
out nationally.
Senator Hoeven. What are those locations?
Mr. Waltman. Where that system is being used to see
patients are at Ashville VA Medical Center, Salt Lake City, and
Cleveland.
SEAMLESS CARE IN THE COMMUNITY
Senator Hoeven. What I am after, and any one of the three
of you from VA who want to take a stab at addressing it, under
the old model, when a veteran wanted care, they called the VA,
and they either got institutional VA care from a health center
or community-based outpatient clinic (CBOC), or they got care
through what was called non-VA healthcare. That was in the
community.
For the most part, that system seemed to work, not
everywhere in the country, but certainly in our part of the
country that worked pretty well. They were getting their
appointments and they were getting to the VA or to a local
private provider if they needed to.
With the third-party providers in place, that system has
totally bogged down Veterans Choice, which is creating a real
problem. That is why we have the pilot project going in North
Dakota, which will serve North Dakota and Western Minnesota. I
am very appreciative the VA is doing that, and I am just trying
to keep it moving along.
I think somehow nationally we have to get to a more
seamless process so veterans are not held up from their
appointments, so they get timely appointments, and so that the
private providers get paid so they will take those veterans and
take them in a timely way, and they are not trying to get
payment out of the veteran then rather than the VA.
If you could just address how we are going to get there and
how soon we can get there, I would appreciate it.
Ms. Council. I will come back to you on some of the
business issues that are going on with some of the early pay
and some of the things Dr. Shulkin and his team are doing to
ensure that people get paid faster and quicker.
Getting there and completion requires that we must also
sort of know what the program is going to look like in the
future. As you know, that is part of the process that is
currently ongoing.
We are working very aggressively. We have over 1,500 health
interchanges in which information is shared with providers. We
are paying early. We are paying faster. We do not want to have
that sort of log jam because there has always been a referral
process within the VA, but as you know with Choice, it requires
that we step further.
A date certain for all completion nationally, I do not
have, but I will come back to you with that.
[The information follows:]
The Community Care Scheduling pilot at the Fargo VAMC was initiated
in September 2016. The Office of Community Care provided routine
updates to Senator Hoeven's office. On August 31, 2016, the Senator and
his staff met with VAMC leadership and the Office of Community Care to
receive a status update on major milestones for the pilot. The key
milestones included contract modifications to the HealthNet contract,
union negotiations, process flows and standard operating procedures for
implementation, and staff training.
Senator Hoeven. It seems to me that is a real key for your
data systems, to be able to get----
Ms. Council. It is.
Senator Hoeven. Mr. Waltman or Dr. Nebeker.
Dr. Nebeker. The level of interoperability, this is like a
wonderful case for interoperability, right, to be able to
schedule for a veteran to come to us and say hey, look, we
think we can help you better if you go across the street or
more locally to your town to get an appointment, let us help
you get an appointment.
Technology does exist for this, but we are analyzing the
maturity of this technology to see if there is
interoperability. University Health Network has some technology
for this.
Also, Boston University was doing a pilot several years ago
that could do this, and now with North Dakota and Louisiana
State University, so we are working with these partners to
assess the maturity and suitability to bring these
technologies. We look forward to the lessons learned from North
Dakota.
Senator Hoeven. Mr. Waltman, anything you want to add?
Mr. Waltman. Thank you, Doctor, you hit the nail on the
head there. That is exactly what we are after, and I appreciate
you saying so. That is what will serve the veteran. It will
serve them through the VA in the best way possible, but also
when they need to go to a local provider either for a certain
capability or just proximity, distance and time, so thank you.
I think that is exactly right, that is what we need to do. I
would like to thank all three of you for your work in this
area.
Senator Hoeven. Thank you, Mr. Chairman.
Senator Kirk. Thank you. I will start with my questioning,
because I am pretty seized with this issue. LaVerne, when we
met, I want to tell you my tale of woe, because I am so focused
on this issue.
INCEPTION OF VISTA
Could you please tell the committee when VistA was started,
what year?
Ms. Council. I have seen a date from 1973 to 1975, but in
1975.
HEALTHCARE ANALYTICS
Senator Kirk. I was so concerned about this, I went down to
the Smithsonian and went to the Innovations Station Exhibit and
took pictures of computers, like this one, the Altair 880,
which is considerably younger than all the systems that you
have. This was the state-of-the-art in 1975, and for $500, I
can get you one.
Is it the state of VistA, it is at this level of
technology? Let me follow up. When we got to the heart of this
hearing, you certified that you are interoperable based on the
JLV's existence, and we now know that the JLV does not have x-
rays or CAT scans, and that is interoperable from your
viewpoint.
I would say you could expect some further definition from
this committee on that point, that we need to move forward on
this point to make sure there is no net burden on the soldier
and sailor when they come out of the Service, that we 100
percent transfer data to the VA, so that VA can see all the
imagery and everything.
In the case of my friend who came back from Iraq, all 38
events in her combat career are included in the record for
disability adjudication.
The long term vision that I have, want to make sure that we
go with a full blown Apple app on the Apps store. I talked to
Cerner this morning. They said they already have several apps
through the Apps store. I would like VA--remembering that the
average age of people coming out of Service is going to be
about 19, if you are a full blown citizen of the 21st century,
you will live on this device.
We are going to have to make sure that there is an app
right there with full access to their record, including
imagery, to make sure their clinicians can do the analytics.
When I got deeper into this, I realized I was going farther
and farther ahead of my own constituents who may not know what
analytics does for their healthcare. I would say analytics
takes us to the next level.
In the case of being able to predict sepsis or suicide, in
the case of Epic, they said in the case of sepsis, that was
54,000 lives that they think were saved by analytics on
probability of sepsis.
When I talked to Cerner, they said the Joint Legacy Viewer
cannot do analytics of the kind to take us to the next level. I
want to make sure that--only this committee, I think, with
jurisdiction over military construction and VA, can lean on
both bureaucracies.
When I first seized with this issue, I thought let's go
with a Mark Kirk version, which would be to make all narratives
Microsoft Word, all images JPEG, so we force the bureaucracy to
talk to itself and make sure that when you serve the United
States in uniform, you can make sure that all of the work the
taxpayers already paid for and your medical record is there for
the VA.
Ms. Council. Sir, I think you know from our conversations
that I concur with you 100 percent, and just to be clear, our
certification of interoperable with JLV was against NDAA
section 713(b)(1). It is not to say that it is semantically
interoperable, it is not.
Senator Kirk. When you cite that section of the law, it
does use the word ``interoperable.'' I want to make sure we are
not in a situation where it depends on what the definition of
``is'' is. We have to get away from that kind of thinking.
Ms. Council. Totally agree. I think you and I also agree on
the fact that having an open platform that will allow new
innovation to come to bear, allow us to really use the best and
the brightest, and also do more around analytics is core and
key to predictive medicine.
This is where the organization is moving, probably not
moving as fast as any of us would like, but certainly we
understand the value of that, and the value of supporting our
veterans with the best.
Senator Kirk. Thank you. I want to go with a full blown
Apple app and make sure all these 19 year olds when they come
out, they just hit the application and can see a full blown
record and can contact VA if they see errors.
Ms. Council. Yes.
Senator Kirk. And that we move forward on that basis. You
will be getting some pretty strong recommendations from this
subcommittee on that point.
ADDITIONAL COMMITTEE QUESTIONS
Let me move to closing here. I want to thank everybody for
coming today, and especially my partner, Senator Tester. We
will leave the record open until the close of next week. Our
members may submit questions for the record.
[Clerk's note: No questions were submitted to the
Department for response subsequent to the hearing.]
CONCLUSION OF HEARINGS
Senator Kirk. We stand adjourned.
[Whereupon, at 12:10 p.m., Wednesday, April 10, the
hearings were concluded, and the subcommittee was recessed, to
reconvene at a time subject to the call of the Chair.]
MILITARY CONSTRUCTION AND VETERANS AFFAIRS, AND RELATED AGENCIES
APPROPRIATIONS FOR FISCAL YEAR 2017
----------
U.S. Senate,
Subcommittee of the Committee on Appropriations,
Washington, DC.
NONDEPARTMENTAL WITNESSES
[Clerk's Note.--The subcommittee was unable to hold
hearings on nondepartmental witnesses. The statements of those
submitting written testimony are as follows:]
Prepared Statement of the American Physiological Society
The American Physiological Society (APS) thanks the subcommittee
for its ongoing support of Medical and Prosthetic Research at the
Department of Veterans Affairs (VA). VA medical research facilities
across the country provide veterans access to state-of-the-art
healthcare and conduct research that specifically addresses the medical
needs of veterans. The APS urges you to make every effort to fund the
VA Medical and Prosthetic Research Program at a level of $664.7 million
in fiscal year 2017.
challenges for va research and medical care
The VA research program specifically addresses medical needs of
veterans, but new technologies and treatments developed at VA medical
centers lead to healthcare improvements for all Americans. VA
scientists have done seminal research into rehabilitation following
traumatic injury, development of state of the art prosthetic devices to
recover functionality, and treatment for post-traumatic stress
disorder, traumatic brain injury, and mental health issues including
suicide. These medical problems are more prevalent among veterans but
are also common in the general population. VA research also explores
other conditions such as dementia, diabetes, pain, addiction and cancer
and offers hope for the veteran and non-veteran alike. The research
carried out in these areas and their resulting innovations will be
particularly important in the coming decades as an aging population
brings new challenges to the American healthcare system.
VA scientists are increasing research on issues specific to female
veterans to better understand gender-specific healthcare needs, women's
experiences in service, and future health risks. The VA also has a
long-standing research portfolio aimed at addressing minority
healthcare needs and disparities in access, delivery and quality.
bringing innovation to healthcare
Because most VA researchers are also clinicians caring for
patients, the VA research system is ideally situated to foster the
translation of basic biomedical research findings into clinically
relevant diagnostics and treatment modalities. The VA has developed a
number of programs that facilitate the translation of knowledge gained
in the lab to use in a clinical setting. One example is the Million
Veteran Program (MVP) which collects genetic samples and general health
information from 1 million veterans and tracks them over 5 years,
creating a wealth of information that will inform research and efforts
to improve healthcare.
Finally, in addition to focusing on research and patient care, VA
medical researchers also play a critical role in educating the next
generation of physician-scientists. Currently, more than half of all
practicing physicians in the US receive some of their training at a VA
facility.
investing in the future
In recent years, Congress has increased funding for the VA Medical
and Prosthetic Research Program, allowing clinicians and researchers to
pursue new ideas that would otherwise go unexplored and expand research
in promising areas of science. In order to build on this investment in
the VA research enterprise, the APS joins our colleagues at the
Federation of American Societies for Experimental Biology in urging you
to appropriate $664.7 million for VA Research in fiscal year 2017. This
level of investment will allow the VA to maintain their current
research program while pursuing new directions to address the needs of
the veteran population.
about the american psysiological society
The APS is a professional society dedicated to fostering research
and education as well as the dissemination of scientific knowledge
concerning how the organs and systems of the body work. The Society was
founded in 1887 and now has more than 10,000 member physiologists. Our
members conduct research at colleges, universities, medical schools,
and other public and private research institutions across the U.S.,
including VA facilities.
______
Prepared Statement of the Federation of American Societies for
Experimental Biology
The Federation of American Societies for Experimental Biology
(FASEB) respectfully requests a minimum of $664.7 million for the VA
Medical and Prosthetic Research Program in fiscal year 2017. This
funding level is needed to keep pace with inflation and sustain support
for research on conditions common among service members returning from
conflicts overseas, as well as the aging veteran population from
previous eras.
FASEB, a federation of 30 scientific societies, represents 125,000
life scientists and engineers, making it the largest coalition of
biomedical research associations in the United States. Our mission is
to advance health and welfare by promoting progress and education in
biological and biomedical sciences.
The Department of Veterans Affairs (VA) Medical and Prosthetic
Research Program provides leadership in creating discoveries and
developing innovations that advance healthcare for our veterans.
Outcomes from this research, however, provide benefits to the entire
Nation. Research supported by the VA serves as a model for how
scientific inquiry and innovative thought can transform medicine.
It is an obligation to provide the highest quality care to those
who have made great sacrifices in service to this country. More than 70
percent of VA researchers are also clinicians who provide direct
patient care, allowing the agency to quickly translate discoveries in
the laboratory to healthcare improvements. VA-clinician investigators
identify new research questions at the patient's bedside and also
undertake a wide array of research to improve the lives of veterans.
VA-funded research has produced significant returns, from advancing
basic knowledge about disease mechanisms to the development of new
treatments and therapies. Partnerships between VA and biotechnology
companies have led to the creation of state-of-the-art prosthetics,
including a bionic ankle-foot that is now in clinical use and systems
that activate residual or paralyzed nerves, muscles, and limbs. In
addition, a unique collaboration between VA researchers and private
pharmaceutical companies supported a successful clinical trial that led
to the development of a vaccine for the shingles virus. Previous VA
clinical trials and studies found that vitamin E can significantly
delay functional decline among those with mild to moderate Alzheimer's
disease and helped shape national guidelines on the use of statin drugs
for patients with high cholesterol.
Additional examples of VA-supported research include:
--Nano-Scale Bone Regeneration Technology: Researchers from the
Atlanta VA medical center have developed a new method for
regenerating bone that could lead the way into a new realm of
osteoporosis therapies. The researchers were able to promote
regeneration of bone in laboratory mice by injecting tiny,
ball-shaped particles covered in silica. These studies of
silica nanoparticle therapies will shed light on the precise
mechanisms of bone formation and repair, and may one day lead
to the development of reliable treatments for bone
degeneration.\1\
---------------------------------------------------------------------------
\1\ http://www.research.va.gov/currents/0815-6.cfm.
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--microRNA Cancer Therapy: Small RNA molecules called microRNAs are
crucial regulators of genes throughout the genome. Scientists
at the VA Northern California Health System have discovered a
particular microRNA that seems to be deficient in bladder
tumors. The team subsequently was able to demonstrate that
reintroduction of this microRNA molecule reduces tumor cell
viability and is now exploring ways in which such molecules
might be translated into effective therapies.\2\
---------------------------------------------------------------------------
\2\ http://www.research.va.gov/currents/june15/0615-6.cfm.
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--Genomic Medicine at the VA: As part of the president's Precision
Medicine Initiative, the VA is undertaking the Million Veterans
Program (MVP). The program is collecting genomic and other
health data from a million veterans in the hopes of finding
medical solutions for the ailments afflicting our Nation's
veterans and the broader American public. For example, in a
pilot study using MVP data, VA researchers are looking at how
genetics might predict patients' response to antidepressants,
thus informing how best to treat depression.\3\
---------------------------------------------------------------------------
\3\ http://www.research.va.gov/currents/1015-2.cfm.
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--Heart Attack Detection Technology: In the event of a heart attack,
rapid access to care is critical in order to prevent damage to
the heart muscle and to save the patient's life. Researchers at
Michael E. DeBakey VA Medical Center in collaboration with
Baylor College of Medicine have begun to develop a technology
that can use a person's saliva to rapidly diagnose heart
attacks when chest-pain or other symptoms are first reported.
This new technology has the potential to increase both the
speed and accuracy of heart attack diagnosis, thus greatly
improving outcomes for heart diseases sufferers.\4\
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\4\ http://news.rice.edu/2010/05/06/diagnosing-heart-attacks-may-
be-a-lick-and-a-click-away/.
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--Personalized Medicine for Pain Management: Millions of Americans
suffer from chronic pain. By investigating the genetic
underpinnings of a specific type of agonizing chronic pain
called ``Man on Fire Syndrome,'' researchers at the West Haven
VA and the Yale School of Medicine were able to discover an
association between a particular protein variant and a positive
response to a pain-killing drug. This finding opens up the
possibility for pain treatments tailored to specific patients
based on their individual genotypes.\5\
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\5\ http://medicine.yale.edu/cnrr/news/article.aspx?id=4412.
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sustained research efforts are critical to meeting increased demand for
health care services
VA research efforts support innovations in care for the growing
population of veterans and non-veterans with chronic illnesses. Hearing
loss is the most common service-connected disability in the VA
healthcare system and affects nearly 30 million Americans. Research
funded by the VA is examining new methods of harnessing technology to
diagnose and treat individuals with hearing disorders. In addition, the
VA is at the forefront of developing treatments to restore vision and
design new assistive devices for the nearly 1 million veterans who are
estimated to be coping with severe visual impairments.
The demand for mental health services is especially acute.
Approximately one in five veterans who served in Iraq and Afghanistan
currently have Post Traumatic Stress Disorder (PTSD) and 300,000 VA
patients seek treatment for major depressive disorder annually. From
fiscal year 2013-fiscal year 2014, the total number of all veterans
receiving compensation for service connected disabilities increased by
10 percent even though VA's research budget grew by only 0.6 percent in
the same time period.\6\
---------------------------------------------------------------------------
\6\ http://www.benefits.va.gov/REPORTS/abr/ABR-Compensation-FY14-
10202015.pdf.
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To address the full spectrum of veterans' healthcare needs and meet
the increasing requests for services, the VA Medical and Prosthetic
Research Program must be provided with additional resources. The
Medical and Prosthetic Research Program will need a budget of $664.7
million (an increase of $34 million over fiscal year 2016) in fiscal
year 2017 in order to keep pace with inflation and sustain support for
research on conditions common among servicemembers returning from
conflicts overseas, as well as the aging veteran population from
previous eras. Funds are also required to continue to enhance and
further develop the MVP.
FASEB recommends a minimum of $664.7 million for the VA Medical and
Prosthetic Research Program in fiscal year 2017 to address the
healthcare problems of the veteran population and ensure they receive
the high quality care they have earned.
Sincerely,
The American Physiological Society
American Society for Biochemistry and Molecular Biology
American Society for Pharmacology and Experimental Therapeutics
American Society for Investigative Pathology
American Society for Nutrition
The American Association of Immunologists
American Association of Anatomists
The Protein Society
Society for Developmental Biology
American Peptide Society
Association of Biomolecular Resource Facilities
The American Society for Bone and Mineral Research
American Society for Clinical Investigation
Society for the Study of Reproduction
The Teratology Society
The Endocrine Society
The American Society of Human Genetics
International Society for Computational Biology
American College of Sports Medicine
Biomedical Engineering Society
Genetics Society of America
American Federation for Medical Research
The Histochemical Society
Society for Pediatric Research
Society for Glycobiology
Association for Molecular Pathology
Society for Redox Biology and Medicine
Society for Experimental Biology and Medicine
American Aging Association (AGE)
U.S. Human Proteome Organization (US HUPO)
LIST OF WITNESSES, COMMUNICATIONS, AND PREPARED STATEMENTS
----------
Page
American Physiological Society, Prepared Statement of the........ 221
Baldwin, Senator Tammy, U.S. Senator From Wisconsin, Questions
Submitted by................................................... 108
Ballentine, Hon. Miranda A.A., Assistant Secretary of the Air
Force, Installations, Environment, and Energy:
Prepared Statement of........................................ 145
Statement of................................................. 143
Collins, Senator Susan M., U.S. Senator From Maine, Questions
Submitted by................................................... 107
Council, Hon. Laverne H., Assistant Secretary for Information and
Technology and Chief Information Officer:
Prepared Statement of........................................ 181
Statement of................................................. 177
Summary Statement of......................................... 179
Federation of American Societies for Experimental Biology,
Prepared Statement of the...................................... 222
Hammack, Hon. Katherine, Assistant Secretary of the Army,
Installations, Energy, and Environment:
Prepared Statement of........................................ 131
Statement of................................................. 130
Iselin, Steven R., Principal Deputy Assistant Secretary of the
Navy, Energy, Installations, and Environment:
Prepared Statement of........................................ 137
Statement of................................................. 136
Kirk, Senator Mark, U.S. Senator From Illinois, Opening
Statements of
Manker, Jamie, Chief Financial Officer, Veterans Benefits
Administration................................................. 8
McConnell, Senator Mitch, U.S. Senator From Kentucky, Questions
Submitted by................................................... 102
McDonald, Hon. Robert A., Secretary, Department of Veterans
Affairs:
Prepared Statement of........................................ 52
Questions Submitted to....................................... 102
Statement of................................................. 47
Summary Statement of......................................... 49
Melvin, Valerie C., Director, Information Management and
Technology Resources Issues, Government Accountability Office:
Prepared Statement of........................................ 190
Statement of................................................. 188
Nebeker, Dr. Jonathan R., Deputy Chief Medical Information
Officer, Veterans Health Administration........................ 177
Potochney, Peter J., Performing the Duties of Assistant Secretary
of Defense, Energy, Installations and Environment:
Prepared Statement of........................................ 116
Statement of................................................. 115
Summary Statement of......................................... 116
Pummill, Danny G.I. (Ret.), Acting Under Secretary for Benefits,
Veterans Benefits Administration:
Prepared Statement of........................................ 10
Statement of................................................. 8
Witness in the Department of Veterans Affairs Hearing on
Thursday, March 10, 2016, Accompanying Hon. Robert A.
McDonald, Secretary, Department of Veterans Affairs........ 47
Shulkin, Hon. David J., MD, Under Secretary for Health, Veterans
Health Administration:
Prepared Statement of........................................ 4
Statement of................................................. 1
Summary Statement of......................................... 2
Witness in the Department of Veterans Affairs Hearing on
Thursday, March 10, 2016, Accompanying Hon. Robert A.
McDonald, Secretary, Department of Veterans Affairs........ 47
Tester, Senator Jon, U.S. Senator From Montana, Statements of
Thompson, Dr. Lauren, Director, DOD/VA Interagency Program
Office, Department of Defense:
Prepared Statement of........................................ 197
Statement of................................................. 196
Waltman, David W., Chief Information Strategy Officer, Veterans
Health Administration.......................................... 177
Yow, Mark, Chief Financial Officer, Veterans Health
Administration................................................. 1
SUBJECT INDEX
----------
DEPARTMENT OF DEFENSE
Office of the Secretary of Defense
Page
Base Realignment and Closure..................................... 125
BRAC............................................................. 172
Building and Maintaining Resilience in the Face of a Changing
Climate........................................................ 129
Commonwealth of Northern Mariana Islands (CNMI) Initiatives...... 128
Environmental:
Conservation and Compatible Development...................... 122
Restoration.................................................. 120
Technology................................................... 121
European Infrastructure Consolidation............................ 127
Facilities Sustainment and Recapitalization...................... 119
Family and Unaccompanied Housing................................. 118
Financial Improvement & Audit Readiness.......................... 129
Fiscal Year 2017 Budget Request:
Energy Programs.............................................. 123
Environmental Programs....................................... 120
Military Construction and Family Housing..................... 117
Highlighted Issues............................................... 125
Installation Energy.............................................. 124
Merger of the Energy, Installations, and Environment
Organizations.................................................. 125
Military Construction............................................ 117
Mission Compatibility Evaluation Process......................... 130
Operational Energy............................................... 123
Overseas Contingency Operations.................................. 118
Rebalance to the Asia-Pacific.................................... 127
Rebasing of Marines from Okinawa to Guam......................... 127
__________
DEPARTMENT OF THE AIR FORCE
Air Force:
2005 BRAC Round.............................................. 162
Community Partnership Program................................ 148
Alternative Aviation Fuel........................................ 153
Base Realignment and Closure (BRAC).............................. 148
Clean Energy..................................................... 151
Climate Change................................................... 149
Cost:
Competitive.................................................. 151
Sharing...................................................... 167
Energy........................................................... 150
Environmental Stewardship........................................ 153
European Infrastructure Consolidation............................ 162
F-35A Beddown--2017 MILCON Program............................... 163
Facility Sustainment, Restoration and Modernization.............. 147
Housing.......................................................... 147
Installation Energy.............................................. 150
KC-46 Strategic Basing Process--Main Operating Base Four Beddown. 170
Materiel Solutions............................................... 152
Military Construction............................................ 145
Mission Assurance through Energy Assurance....................... 150
Modeling and Simulation.......................................... 152
Operational Energy............................................... 152
Process Changes.................................................. 153
Resilience....................................................... 151
RPA Wing Beddown................................................. 170
Science and Technology........................................... 152
The Sweet Spot................................................... 152
UH-1N Replacement MILCON......................................... 169
__________
DEPARTMENT OF THE ARMY
BRAC............................................................. 172
Cost Sharing..................................................... 167
Ensuring Energy Security......................................... 134
Fort McCoy....................................................... 165
Information Memorandum........................................... 157
Timeline for Army Cleanup at White Sands Missile Range....... 157
Investing in Essential Infrastructure............................ 133
Making Efficient Use of Army Facilities.......................... 132
MILCON Backlog................................................... 164
Preserving Ready Installations................................... 133
Renewable Energy................................................. 166
Safeguarding our Environment..................................... 135
WSMR/Sustainment Funding......................................... 156
__________
DEPARTMENT OF THE NAVY
Base Operating Support (BOS)..................................... 140
Cost Sharing..................................................... 167
Enhancing Combat Capabilities.................................... 142
Facilities Sustainment, Restoration and Modernization (FSRM)..... 140
Family Housing................................................... 139
Investing in Our Infrastructure.................................. 137
Managing Our Footprint........................................... 140
Military Construction (MILCON)................................... 138
Protecting Our Environment....................................... 141
Safety Program................................................... 140
Sustainment Funding.............................................. 143
__________
DEPARTMENT OF VETERANS AFFAIRS
2018 Advance Appropriation....................................... 84
A Vision for the Future.......................................... 52
Access Received Closer to Home................................... 85
Additional Committee Questions
Albuquerque VAMC Medical Investigation Report.................... 96
Analytic Capability.............................................. 203
Applications for Future Digital Health Platform.................. 209
Appointment Scheduling Improvements.............................. 206
Benefits Programs................................................ 66
Better Care in the Community Legislation......................... 83
Choice:
Program...................................................... 110
Alaska................................................... 98
Third Party Service Providers................................ 87
CIO Council Impression of VA IT.................................. 199
Closing Unsustainable Facilities................................. 63
Comprehensive Definitions for All Datasets....................... 209
Digital Health Platform.......................................... 211
Disposition of Final Reports on Tomah............................ 110
Dysfunctional Continuum of Care--Choice Program.................. 107
Electronic Health Records Available to JLV....................... 213
Ending Veteran Homelessness...................................... 66
Ensuring Veterans Access to Care................................. 64
Enterprise Cybersecurity Strategy................................ 185
Exempting Copayment Requirements for Naloxone Rescue Kits and
Education...................................................... 113
Female Veterans.................................................. 111
Fiscal Year 2017 Budget Request.................................. 58
Full Interoperability............................................ 204
Timetable.................................................... 201
GAO Skepticism on VA's Assertions................................ 212
Healthcare Analytics............................................. 217
Hines VAMC:
Inspector General Investigation.............................. 97
Scheduling Manipulation Investigation........................ 82
Wait Times Data.............................................. 97
Inception of VistA............................................... 217
Individual Service Records....................................... 213
Inspector General:
Confirmation................................................. 83
Missal Nomination for Approval............................... 96
Interoperability and Enterprise Health Management Platform....... 199
IT Transformation and Enterprise Program Management Office....... 186
Jason Simcakoski Memorial Opioid Safety Act...................... 91
Joint Legacy Viewer Lacking Analytics............................ 202
Legislative Priorities........................................... 80
Long-Term and Home Care.......................................... 88
Looking to the Future............................................ 183
MASS and Scheduling.............................................. 208
Medical:
Appointment Scheduling System................................ 207
Prosthetic Research.......................................... 72
MyVA Transformation.............................................. 76
National Level In-House Scheduling............................... 215
One Seamless System.............................................. 204
Open Source Applications......................................... 211
Other Priorities................................................. 73
Over 800 VA Applications......................................... 199
Private Providers and Health Information Exchange................ 205
Productivity Improvements and Stewardship........................ 61
Recruitment of VA Medical Staff.................................. 95
Rising Demand for VA Care and Benefits........................... 58
Scheduling....................................................... 184
Systems...................................................... 215
Seamless Care in the Community................................... 216
SES Executives to Title 38....................................... 84
Simplified Appeals Process Proposal.............................. 85
Single VA and DOD EHR System..................................... 204
Social Security Numbers as Identifier to Veterans' Records....... 91
Article From Channel3000.com, WISC-TV, News 3, Madison,
Wisconsin, (By Adam Schrager).............................. 92
The Simplified Appeals Initiative................................ 68
Three High Risk VA Development Projects.......................... 208
Use of Social Security Numbers as Identifiers for Veterans....... 108
VA:
Agency Priority Goals........................................ 55
Graduate Medical Education (GME) Expansion and Staffing...... 111
Healthcare:
Operational Issues in Alaska............................. 100
Staffing Productivity to Private Sector.................. 89
Infrastructure............................................... 74
Participation in Prescription Drug Monitoring Program........ 107
Patient Scheduling System.................................... 90
Planning for the EHR Future.................................. 212
Veterans:
Choice Improvement Act....................................... 87
Crisis Line Contractor....................................... 98
VistA Evolution/Interoperability................................. 181
GOVERNMENT ACCOUNTABILITY OFFICE
Background....................................................... 192
Electronic Health Records........................................ 190
Full Interoperability............................................ 204
GAO:
Highlights................................................... 190
Skepticism on VA's Assertions................................ 212
One Seamless System.............................................. 204
Single VA and DOD EHR System..................................... 204
Together with DOD and the Interagency Program Office, VA Needs to
Develop Goals and Metrics for Assessing Interoperability....... 194
VA:
Efforts Raise Concerns About Interoperability Goals and
Measures, Duplication With DOD, and Future Plans........... 190
Has Begun to Implement VistA Modernization Plans Amid
Uncertainty About Its Approach; the Department Is Currently
Reconsidering How to Proceed............................... 195
Plan to Modernize VistA Raises Concern about Duplication with
DOD's Electronic Health Record System Acquisition.......... 194
What GAO:
Found........................................................ 190
Recommends................................................... 190
Why GAO Did This Study........................................... 190
__________
VETERANS BENEFITS ADMINISTRATION
Access to Care................................................... 19
All VBA Benefit Programs......................................... 14
Appeals Backlog.................................................. 20
Claims Processing Transformation................................. 12
Forecast for Benefits Demand..................................... 34
Fully Developed Claims Expedited Process......................... 23
Legislation...................................................... 16
Military Sexual Trauma Adjudication.............................. 22
MyVA Transformation--Meeting Veterans' Needs..................... 12
New Agency Priority Goal to Improve Dependency Claim Processing.. 14
Other Than Dishonorable Discharge................................ 27
Rising Demand for Disability Benefits............................ 10
Simplify Appeals Process......................................... 23
Summary of 2017 Budget Request................................... 10
Transformation Initiatives in the President's 2017 Budget Request 13
VBA Budget Request............................................... 22
Veterans to Agriculture Project.................................. 32
__________
VETERANS HEALTH ADMINISTRATION
Access to Care................................................... 19
Additional Committee Questions
Administrative Investigation Board on Milwaukee Domiciliary...... 38
Advances in Medical and Prosthetic Research...................... 7
Albuquerque VAMC Medical Investigation Report.................... 96
Analytic Capability.............................................. 203
Appeals Backlog.................................................. 20
Best Practices System............................................ 29
Care in the Community............................................ 6
Caregiver:
Program...................................................... 33
Support Program.............................................. 6
Tracking System.............................................. 35
Choice:
Program Third Party Administrators........................... 31
Alaska................................................... 98
Third Party Service Providers................................ 87
Connecticut Campaign to End Chronic Veteran Homelessness......... 28
Electronic Health Records:
And GAO High Risk List....................................... 25
Available to JLV............................................. 213
Ending Veterans Homelessness..................................... 7
Front Line Disciplinary Action................................... 30
Healthcare:
Analytics.................................................... 217
Facilities Budget Request.................................... 26
Hepatitis C:
Drug Treatment............................................... 41
Virus........................................................ 6
Hines VAMC:
Inspector General Investigation.............................. 97
Wait Times Data.............................................. 97
Improved Access to Care.......................................... 5
Improving Veterans Access to Care in the Community Act........... 21
Inception of VistA............................................... 217
Individual Service Records....................................... 213
Inspector General Missal Nomination for Approval................. 96
Interoperability Definition...................................... 200
Jason Simcakoski Memorial Opioid Safety Act...................... 91
Joint Legacy Viewer:
Lacking Analytics............................................ 202
Imaging Issues............................................... 200
Long-Term and Home Care.......................................... 88
Mental Health:
Care (Suicide Prevention--A Call To Action).................. 5
No-Show Rate Appointments.................................... 29
Montana's Choice Program With Health Net......................... 21
Naloxone Kits as a High Priority................................. 40
National Level In-House Scheduling............................... 215
Open Air Burn Pits Registry...................................... 20
Opioid Dependence and Alternatives............................... 33
Other Than Dishonorable Discharge................................ 27
Over Prescription of Opioids..................................... 43
Recruitment of VA Medical Staff.................................. 95
Scheduling Systems............................................... 215
Seamless Care in the Community................................... 216
Social Security Numbers as Identifier to Veterans' Records....... 91
Article From Channel3000.com, WISC-TV, News 3, Madison,
Wisconsin, (By Adam Schrager).............................. 92
Standard Productivity Measures................................... 25
Telehealth and Telemedicine...................................... 23
VA:
DOD Joint Electronic Health Record........................... 44
Healthcare:
Operational Issues in Alaska............................. 100
Staffing Productivity to Private Sector.................. 89
System in Alaska......................................... 35
Patient Scheduling System.................................... 90
Veterans:
Choice Improvement Act....................................... 87
Crisis Line.................................................. 17
Contractor............................................... 98
VHA 2018 Advance Request......................................... 43
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