[House Hearing, 115 Congress]
[From the U.S. Government Publishing Office]


FISCAL YEAR 2018 DEPARTMENT OF VETERANS AFFAIRS BUDGET REQUEST FOR THE 
                     VETERANS HEALTH ADMINISTRATION

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

                                 HEARING

                               BEFORE THE

                         SUBCOMMITTEE ON HEALTH

                                 OF THE

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

                     ONE HUNDRED FIFTEENTH CONGRESS

                             FIRST SESSION

                               __________

                        THURSDAY, JUNE 22, 2017

                               __________

                           Serial No. 115-19

                               __________

       Printed for the use of the Committee on Veterans' Affairs
       
       
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                    COMMITTEE ON VETERANS' AFFAIRS

                   DAVID P. ROE, Tennessee, Chairman

GUS M. BILIRAKIS, Florida, Vice-     TIM WALZ, Minnesota, Ranking 
    Chairman                             Member
MIKE COFFMAN, Colorado               MARK TAKANO, California
BRAD R. WENSTRUP, Ohio               JULIA BROWNLEY, California
AMATA COLEMAN RADEWAGEN, American    ANN M. KUSTER, New Hampshire
    Samoa                            BETO O'ROURKE, Texas
MIKE BOST, Illinois                  KATHLEEN RICE, New York
BRUCE POLIQUIN, Maine                J. LUIS CORREA, California
NEAL DUNN, Florida                   KILILI SABLAN, Northern Mariana 
JODEY ARRINGTON, Texas                   Islands
JOHN RUTHERFORD, Florida             ELIZABETH ESTY, Connecticut
CLAY HIGGINS, Louisiana              SCOTT PETERS, California
JACK BERGMAN, Michigan
JIM BANKS, Indiana
JENNIFFER GONZALEZ-COLON, Puerto 
    Rico
                       Jon Towers, Staff Director
                 Ray Kelley, Democratic Staff Director

                         SUBCOMMITTEE ON HEALTH

                     BRAD WENSTRUP, Ohio, Chairman

GUS BILIRAKIS, Florida               JULIA BROWNLEY, California, 
AMATA RADEWAGEN, American Samoa          Ranking Member
NEAL DUNN, Florida                   MARK TAKANO, California
JOHN RUTHERFORD, Florida             ANN MCLANE KUSTER, New Hampshire
CLAY HIGGINS, Louisiana              BETO O'ROURKE, Texas
JENNIFER GONZALEZ-COLON, Puerto      LUIS CORREA, California
    Rico

Pursuant to clause 2(e)(4) of Rule XI of the Rules of the House, public 
hearing records of the Committee on Veterans' Affairs are also 
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                           C O N T E N T S

                              ----------                              

                        Thursday, June 22, 2017

                                                                   Page

Fiscal Year 2018 Department of Veterans Affairs Budget Request 
  For The Veterans Health Administration.........................     1

                           OPENING STATEMENTS

Honorable Brad Wenstrup, Chairman................................     1
Honorable Julia Brownley, Ranking Member.........................     2

                               WITNESSES

Joy Ilem, National Legislative Director, Disabled American 
  Veterans.......................................................     3
    Prepared Statement...........................................    35
Carl Blake, Associate Executive Director, Government Relations, 
  Paralyzed Veterans of America..................................     5
    Prepared Statement...........................................    39
Carlos Fuentes, Director, National Legislative Service, Veterans 
  of Foreign Wars of the United States...........................     7
    Prepared Statement...........................................    43
Matthew Shuman, Director, Legislative Division, The American 
  Legion.........................................................     8
    Prepared Statement...........................................    46
Poonam Alaigh M.D., Acting Under Secretary for Health, Veterans 
  Health Administration, U.S. Department of Veterans Affairs.....    10
    Prepared Statement...........................................    48

        Accompanied by:

    Mark W. Yow MBA, Chief Financial Officer, Veterans Health 
        Administration, U.S. Department of Veterans Affairs

                       STATEMENTS FOR THE RECORD

Billy R. Maynard, President and CEO, Health Net Federal Services, 
  LLC............................................................    52

 
FISCAL YEAR 2018 DEPARTMENT OF VETERANS AFFAIRS BUDGET REQUEST FOR THE 
                     VETERANS HEALTH ADMINISTRATION

                              ----------                              


                        Thursday, June 22, 2017

             U.S. House of Representatives,
                    Committee on Veterans' Affairs,
                      Subcommittee on Disability Assistance
                                      and Memorial Affairs,
                                                   Washington, D.C.
    The Subcommittee met, pursuant to notice, at 2:03 p.m., in 
Room 334, Cannon House Office Building, Hon. Brad Wenstrup 
[Chairman of the Subcommittee] presiding.
    Present: Representatives Wenstrup, Bilirakis, Radewagen, 
Dunn, Rutherford, Higgins, Brownley, Takano, Kuster, O'Rourke, 
and Correa.
    Also Present: Representatives Roe and Sablan.

          OPENING STATEMENT OF BRAD WENSTRUP, CHAIRMAN

    Mr. Wenstrup. The Subcommittee will come to order. Before 
we begin, I would like to ask unanimous consent for fellow 
Committee Member Congressman Sablan from the Northern Mariana 
Islands to sit on the dais and participate in today's 
proceedings.
    Without objection, so ordered. Thank you.
    With that, good afternoon. We thank you all for joining us 
today to discuss the Department of Veterans Affairs fiscal year 
2018 budget submission, particularly as it pertains to medical 
and mental health care, community care, medical and prosthetic 
research, construction and infrastructure, and veteran 
homelessness. There is certainly no shortage of topics to 
address this afternoon, so I will keep my opening comments 
short so we can devote most of our time to questions.
    However, there are three points to discuss before hearing 
from Ranking Member Brownley and our witnesses.
    First, the President's budget request includes $186.5 
billion in budget authority for VA in fiscal year 2018, an 
increase of $6.4 billion over fiscal year 2017.
    Some have alleged that the increased funding for the 
Veterans Health Administration in this budget goes primarily to 
community care programs, like Choice, rather than traditional 
in-house programs, which some claim is a dangerous step toward 
privatization. This is not the case. And privatization is 
certainly not the goal.
    As the Secretary clarified in testimony before the Senate 
just yesterday, the increase provided to medical services in 
this budget is three times as large as the increase provided to 
community care.
    Second, the elephant in the room this afternoon is the 
unexpected shortfall in the Choice Fund that the Secretary 
announced last week.
    In a letter sent to the Committee on Friday evening, 
Secretary Shulgin wrote that higher than expected utilization 
of the Choice Program this year has resulted in an acceleration 
of funds being expended from the Veterans Choice Fund and 
without significant changes to current Choice processes. The 
Choice Fund is expected to run dry by August 15th.
    There are a number of questions remaining today about the 
extent of the shortfall, the resources, and the actions the 
Secretary needs and when to address it and the consequences of 
inaction for veteran patients who, more than ever before, are 
relying on Choice to get the care that they need.
    Dr. Alaigh, I am hoping that you will be able to provide 
some clarity this afternoon on all of those things. Finally, as 
the Choice Fund shortfall clearly shows, we have challenges 
today, problems we cannot solve without the help of our 
veterans service organization partners. I am grateful to 
Disabled American Veterans, Paralyzed Veterans of America, the 
Veterans of Foreign Wars, and The American Legion for agreeing 
to testify this afternoon.
    We share a mutual sacred goal: meeting health care needs of 
veteran patients. We are relying on you to come to the table 
with actionable solutions with how we can move forward together 
given the fiscal realities that we all know exist. We can't 
hide from them.
    I am grateful in advance for your candor and your 
cooperation, and I am very much looking forward to today's 
discussion.
    And, with that, I will now yield to the Ranking Member 
Brownley for any opening statement that she may have.

      OPENING STATEMENT OF JULIA BROWNLEY, RANKING MEMBER

    Ms. Brownley. Thank you, Mr. Chairman.
    And thank you, Under Secretary, for being here with us 
today. I look forward to hearing from you on how this budget 
request will meet the health care needs of our Nation's 
veterans. I am also looking forward to testimony from the VSOs 
on whether or not this budget request meets the needs of their 
millions of veteran members.
    Dr. Alaigh, as Acting Under Secretary of Health, you have 
taken on more in the last few months of your tenure than many 
prominent Under Secretaries attempt in their entire period of 
service. Over the last few months, VHA has committed to the 
acquisition of a commercial electronic health care record 
system, the extension of the Choice Program to utilize all of 
the funds Congress provided in 2014, the consolidation of 
capital assets, the establishment of a White House hotline, and 
VA's decision to drop the appeal of the Staab case.
    And while these commitments and decisions seem to be 
necessary on their face, I question whether VHA has been 
realistic in their request for the funds to support these 
costly commitments.
    I hope today that you and the VSOs here can help my 
colleagues and myself understand how VHA plans to successfully 
execute these commitments while ensuring that quality and 
access to VHA care is improved and not sacrificed.
    Because Members of this Committee on both sides of the 
aisle want you to succeed and build the 21st century high-
performing VHA our veterans deserve, I am especially interested 
in hearing more today about services and programs to improve 
women veterans health care. This cannot fall by the wayside.
    By 2035, the population of women veterans is expected to 
swell to 35 percent of the total veteran population. VHA must 
be prepared to meet these expanding populations' needs. Women 
veterans deserve to receive care from professional providers in 
comfortable settings and in easily accessible manner. We need 
to keep working to break down barriers that may be preventing 
women veterans from receiving VA care, and I look forward to 
hearing from you, Doctor, and the VSOs about how we can do it 
better.
    I am also looking forward to hearing more about other 
programs, including the caregiver program, the future of the 
VA's Care in the Community accounts, medical research, and 
services to address mental health and veteran suicide. While I 
am glad to see a general increase in the funding at VHA, we 
also want to hear more about some of the cuts and spending 
decisions included within the budget and how these could impact 
the care we provide to our veterans.
    Dr. Alaigh, yesterday, we had an opportunity to meet and 
talk about some areas of concerns I have regarding the services 
in my district and across the country, and I appreciate the 
dialogue that we have had on these issues. I hope today we can 
continue that open dialogue and work together and with the VSOs 
to determine what level of funding is necessary to ensure that 
VHA can accomplish its full mission.
    Thank you, Mr. Chairman. And I yield back the balance of my 
time.
    Mr. Wenstrup. Thank you.
    Joining us this morning on our first and only panel is Joy 
Ilem, the National Legislative Director for the Disabled 
American Veterans; Carl Blake, the Associate Executive Director 
For Government Relations for the Paralyzed Veterans of America; 
Carlos Fuentes, the Director of the National Legislative 
Service for the Veterans of Foreign Wars of the United States; 
Matt Shuman, the Director of the Legislative Division for The 
American Legion; and Dr. Poonam Alaigh, the Acting Under 
Secretary for Health in the Veterans Health Administration in 
the Department of Veterans Affairs, who is accompanied by Mark 
Yow, who is the Chief Financial Officer for the Veterans Health 
Administration.
    I want to thank you all for meeting here this afternoon.
    Ms. Ilem, we will begin with you. You are now recognized 
for 5 minutes.

                     STATEMENT OF JOY ILEM

    Ms. Ilem. Thank you, Mr. Chairman, and Members of the 
Subcommittee. On behalf of DAV and as one of the coauthors of 
the independent budget, I am pleased to present our views on 
the budgetary needs for a few of VA's most critical health care 
programs. While DAV appreciates the increases recommended for 
VA in the President's budget, we are concerned they are not 
sufficient for VA to meet significant increased demand for care 
and its goals of providing timely, high-quality care for 
veterans both in the VA and in the community.
    We applaud Secretary Shulkin for his leadership and efforts 
to restore veterans' trust in VA and to improve their access to 
care and benefits as well as his focus on reforming inefficient 
business practices and modernizing the Department. We know the 
Secretary has also set forth a number of other priorities: 
building a high-performing health care network, addressing 
capital infrastructure needs, replacement of VA's electronic 
health records and critical IT systems, expanding mental health 
services to veterans with other than honorable discharges, and 
the campaign to eliminate suicide in the veteran population.
    While we support all of these reforms, we want there to be 
an honest assessment and discussion about what the real costs 
are for accomplishing all of these important goals.
    Additionally, we ask that you reject the proposals included 
in the President's budget that would eliminate individual 
unemployability benefits and ramp down veterans' disability 
compensation cost-of-living adjustments for millions of 
service-disabled veterans.
    Another important issue to veterans is timely access to VA 
mental health services. Veterans with serious mental health 
illness, post-deployment mental health challenges, including 
PTSD associated with combat or sexual trauma, are best served 
by VA's highly skilled mental health providers and a 
comprehensive mental health care model. These services are also 
critical to VA's suicide prevention efforts.
    We also note the Secretary proposed opening access to 
mental health care for veterans in crisis who have received a 
less than honorable discharge. While we support this 
initiative, we are concerned that no additional resources have 
been put forth in the budget to address a potential increase in 
workload, hire additional providers, or expand clinical space, 
if necessary. We also want to ensure appropriate funding is 
available to improve VA care and services for women veterans.
    DAV recommends an additional $110 million for women's 
health programs to meet increased demand for services including 
coverage of gender specific care, hiring and training of 
women's health providers, expansion of childcare pilot and days 
of care for newborns, as well as renovating VA's facilities to 
resolve identified privacy and safety deficiencies.
    Additional funding is also essential to continue research 
on the health effects of wartime service on women veterans and 
to better address the high rates of homelessness, suicide, and 
unique transition challenges among this population. These 
services are especially critical for women veterans with 
service-connected disabilities, women veterans with wartime 
service, and women who have--and veterans who have experienced 
sexual trauma.
    Finally, we ask the Subcommittee to eliminate the inequity 
in the current caregiver law this year which limits essential 
services and supports to family caregivers of post-9/11 
veterans. The limitation left thousands of seriously disabled 
veterans' families without the level of caregiver support and 
services that they desperately need and deserve. It is time now 
to recognize the selfless service and dedication of all our 
caregivers by including resources in the fiscal year 2018 
budget to finally resolve this inequity.
    In closing, the new administration has pledged full support 
for our Nation's veterans and a reformed VA. Secretary Shulkin 
has committed to carry out that promise by creating a system 
that is worthy of their service and sacrifices.
    As VA moves forward to rebuild trust with veterans, make 
needed reforms, and carry out modernization plans to strengthen 
and improve veterans' health care, we must ensure VA has the 
resources and support needed to be successful.
    Mr. Chairman, that completes my statement, and I am pleased 
to answer any questions you may have. Thank you.

    [The prepared statement of Joy Ilem appears in the 
Appendix]
    Mr. Wenstrup. Thank you.
    Mr. Blake, you are now recognized.

                    STATEMENT OF CARL BLAKE

    Mr. Blake. Chairman Wenstrup, Ranking Member Brownley, 
Chairman Roe, and Members of the Subcommittee, on behalf of 
Paralyzed Veterans of America, our coauthors of the independent 
budget, the VFW, DAV, I would like to thank you for the 
opportunity to testify today.
    I think I would like to begin by applauding the VA and 
Secretary for a number of recent decisions that he has made 
with regards to the IU proposal and the need to use that money 
to fund the Choice Program. He has said he will drop the IU 
proposal as a means to fund it. That is the right decision.
    The Staab ruling, the decision to drop the appeal so that 
veterans can now get reimbursed for emergency care sought in 
the community, a decision in that case that is the right 
decision.
    The decision with regard to finally coming to a linkable, 
interoperable solution in EHR with the Department of Defense, 
that looks like it is the right solution.
    The decision as it relates to other than honorable 
discharges, it will serve veterans that need to be served; that 
is the right decision.
    The caregiver expansion, we all in this room know what the 
right decision is. It is yet to be made, but it needs to be 
made.
    Now let's think about the financial impact of those right 
decisions. The IU proposal alone leaves $3.2 billion that must 
be addressed. You cannot be unequivocal about that: $3.2 
billion that now has to be addressed in some fashion.
    The Staab ruling, that is $2 billion in outstanding 
obligations from the previous 2 years, plus what will likely be 
an average of $1 billion going forward under that requirement.
    We don't even know yet what the EHR costs will be in the 
long term. There are estimates, but they vary.
    The same with the other than honorable discharge.
    We know that the caregiver expansion will cost significant 
money. That doesn't mean that it is not the right thing to do.
    I have heard in the last week or two a lot of discussion 
about, well, VA has its collections money available, has its 
carryover funds available, it needs transfer authority: all of 
these ways that they can presumably get to fixing these 
problems. But let's be reminded: The IU and the Staab rulings 
alone are $5 billion. I don't work in the VA, but I doubt that 
there is $5 billion laying around at central office or in the 
business available to fill those holes.
    The fact is that VA has not been fully forthcoming with 
what it needs for these purposes. And to keep saying, ``Well, 
we have collections money available, we have carryover money 
available, just give us the transfer authority, we can make 
this work,'' that is nonsense. We have grown weary of that 
nonsense.
    I will grant you that collections money is available, but 
it is already planned for some purpose in VA. It is built into 
VA's budget baseline. If you take that money and fill the 
Choice hole, what did you take it away from? There are 
crosswalks that might demonstrate where those are taken from, 
but you better be able to justify where you are taking that 
money from.
    Carryovers, I will grant you the VA ends up with a 
significant amount of money that is available each year in 
carryovers. My understanding is some of what they have 
available is fenced for the hepatitis decision, and with some 
flexibility, they can repurpose that because they came in under 
cost to meet the hepatitis need.
    But, you know, we often get asked the question, why the 
hell does the VA still have carryover money at the end of the 
year, particularly when it is hundreds of millions of dollars? 
What are they spending their money on? Or, better yet, what are 
they not spending their money on? I understand that they can't 
spend more than they are given. I fully understand that. But 
when the VA has hundreds of millions of dollars left in 
carryover every year, begs a lot of questions about how they 
are being efficient with their resources.
    The idea that they just need the transfer authority to move 
money around--the Secretary has really sort of harped on this, 
is give us the ability to transfer money out of the medical 
community care account to fill in the hole on Choice. Fine. If 
you want to do that, fine. But I ask you, what happens to the 
veterans being served in that medical community care account 
State currently? How are you going to address their needs--or 
if you take it from somewhere else? A perfect snapshot of this 
transfer authority issue is the NRM piece of medical 
facilities. For years, the VA requested approximately $500 
million for NRM. I can tell you, and the VA knows, they 
actually spend about $1.3 billion to $1.4 billion a year. They 
actually spend that money. Where is that money coming from? 
What are they borrowing from to pay for that bill? What Peter 
are they robbing to pay Paul?
    We are tired of this. The VSOs, the veterans we serve, the 
veterans that seek care from the VA are tired of this. It is 
time to just do it right. Tell us what you need, let Congress 
act upon it.
    The Mil Con, VA Appropriations in the full Appropriations 
Committee just last week approved their bill to fund the VA. It 
is less than the administration's request. Does that sound like 
it is a good idea? Because I certainly don't think so.
    Mr. Chairman, I would like to thank you again for the 
opportunity to testify. I would be happy to answer any 
questions you or the Members may have.

    [The prepared statement of Carl Blake appears in the 
Appendix]
    Mr. Wenstrup. Thank you, Mr. Blake.
    Mr. Fuentes, you are now recognized for 5 minutes.

                  STATEMENT OF CARLOS FUENTES

    Mr. Fuentes. Chairman Wenstrup, Ranking Member Brownley, 
Members of the Subcommittee, on behalf of the men and women of 
the VFW Auxiliary, I would like to thank you for the 
opportunity to present our views on VA's budget request.
    The VFW is glad the administration has proposed a 6-percent 
increase in VA's discretionary budget. We also strongly support 
the Department's focus on increased access to high-quality 
health care for our Nation's veterans; combating veterans 
suicide, including partnerships with organizations like the VFW 
to leverage our footprints in communities around the country 
and the world in an effort to eliminate the stigma associated 
with seeking mental health care; ensuring VA is ready and able 
to care for women's veterans, who are the fastest growing 
cohort of the veterans' population; and the continued 
commitment to end veterans homelessness.
    However, I would like to make it clear that the VFW 
strongly opposes efforts to claw back benefits from our most 
severely disabled veterans. In the past 2 weeks, more than 
40,000 letters and emails from VFW members and supporters have 
been sent to Members of Congress opposing the administration's 
proposal to revoke individual unemployability benefits for 
veterans who are unable to work because of their service 
disabilities. The VFW opposes the IU and the COLA ground-down 
proposals in the Department's budget request. And we are glad 
to see Secretary Shulkin has agreed to look for other ways to 
fund the Choice Program.
    The continued failure by Congress to eliminate 
sequestration has forced the administration to propose cuts to 
veterans programs in order to expand the Choice Program under 
mandatory spending instead of including the program in 
discretionary spending. Sequestration and Budget Control Act 
spending caps limit our Nation's ability to provide 
servicemembers, veterans, and their families the care and 
benefits they have earned. The VFW calls on this Subcommittee 
to join our campaign to end sequestration and do away with 
arbitrary and outdated budget caps.
    For more than a decade, the IB VSOs have warned Congress 
and the VA that perpetual underfunding has allowed VA's 
infrastructure to erode while its capacity has swelled from 81 
percent in 2004 to as high as 100 percent to 2012. We continue 
to believe that this need for space and chronic underfunding of 
VA's major construction projects could force VA to ration care. 
VA's budget request says that improving the conditions of VA 
facilities through major construction projects accounts for the 
largest resource need to keep pace with the growing demand of 
VA outpatient care, yet the administration's request only funds 
one VA major construction project.
    The IB VSOs believe that VA has requested an adequate 
amount for major medical leases. However, Congress must find a 
way to quickly authorize leasing projects. There are now 27 
major medical leases awaiting congressional approval. Delays in 
authorization of these leases have a direct impact on VA's 
ability to provide timely care to veterans. The VFW urges the 
Committee to swiftly pass legislation that would streamline the 
authorization process for VA's major medical leases.
    Mr. Chairman, this concludes my remarks. I am happy to 
answer any questions that you or the Members of the 
Subcommittee may have.

    [The prepared statement of Carlos Fuentes appears in the 
Appendix]
    Mr. Wenstrup. Thank you, Mr. Fuentes.
    Mr. Shuman, you are now recognized for 5 minutes.

                  STATEMENT OF MATTHEW SHUMAN

    Mr. Shuman. Earlier this week, a fellow veteran called The 
American Legion for help. She was seeking medical care from the 
VA, a mammogram specifically, but the VA employee told her that 
the request was denied because funds from the Choice Program 
were depleted. Fortunately, the VA employee was wrong. Our 
staff contacted Dr. Baligh Yehia, the Deputy Under Secretary 
for Health and Community Care at the VA, to determine if the 
funds were available so this veteran can receive the medical 
diagnostics she deserved. The bad news is the Choice Program 
seems to confuse even VA staff. The good news is The American 
Legion and Dr. Baligh Yehia were able to assure the veteran got 
the care she needed.
    Chairman Wenstrup, Ranking Member Brownley, Chairman Roe, 
and Members of the Subcommittee, on behalf of Charles E. 
Schmidt, the national commander for the largest veteran 
organization in the United States, representing more than 2.2 
million members, we welcome this opportunity to comment on the 
President's proposed budget.
    The American Legion has reviewed the President's budget 
request, and while we fully support the administration's 
proposal to increase the discretionary budget for the VA by 
$4.3 billion, we would like to draw this Committee's attention 
to several components of this request that only Congress can 
address.
    In 2014, President Obama signed the Choice Act. The 
American Legion supported this program as a temporary emergency 
measure, provided it had a sunset date. Through increased 
emphasis on eradicating all hidden wait lists and ensuring that 
all veterans asking for VA medical appointments were seen 
within 30 days or less, VA quickly exhausted their community 
care accounts while the Choice funding remained largely 
untouched. Because of the way Choice was funded, VA couldn't 
adjust the funding between their traditional contracting 
accounts. This created an unbalanced community care program. 
Then-Secretary McDonald mandated all appointments be pushed 
through the Choice Program to spend the money. This decision 
caused an artificial dependence on the Choice Program while 
preserving VA's more established community care program 
accounts.
    The American Legion calls on the President and this 
Congress to support VA medical infrastructure by reallocating 
the funding proposed in the 2018 Presidential budget toward 
current community care programs and allowing Choice to expire.
    Shifting from Choice to mental health, about one-third of 
returning servicemembers report mental health symptoms and 
suffer from major depression or post-traumatic stress disorder. 
Sixteen years of continuous conflict in Iraq, Afghanistan, and 
elsewhere has increased the demand for mental health services 
at VA. Unfortunately, there is a national shortage of mental 
health care providers, and this shortage is projected to grow 
over the next decade. Simply stated, there is an urgent need to 
respond and assist veterans in a timely and responsible manner. 
The American Legion calls on this President and this Congress 
to increase funding to eradicate mental health staffing 
shortages.
    Focusing on medical research and IT, I think we can all 
agree that medical research is essential to improving the 
quality of care for veterans. The American Legion noticed that 
in the President's budget, $18 million has been stripped out of 
the IT appropriation for all VA research. We are very concerned 
about the long-term impacts of cutting research projects like 
the Million Veteran Program. Few people know that the VA has 
built the world's largest and most robust genomic databases 
where medical investigators are currently studying Gulf War 
illness, PTSD, bipolar illness, and more.
    The VA's medical research helps to advance VA health care 
and ensures the VA delivers world class, innovative services to 
veterans. A significant cut like this will negatively impact 
veterans.
    Secretary Shulkin, in his speech made at the White House, 
stated he plans drastic changes to VA IT. In fact, he mentioned 
this may be the only area in which he asks Congress for more 
funds. As previously stated, The American Legion is very 
concerned about the long-term impacts of an $18 million cut to 
the VA IT architecture, and we call the President and this 
Congress to fully fund medical research and modernization.
    Lastly, I will quickly address some ideas to pay for the 
increased budget at the VA. The American Legion aggressively 
opposes cannibalizing existing benefits earned by veterans to 
support benefits for other veterans. Without question, the 
proposal to eliminate the individual unemployability benefit is 
one of the worst ideas The American Legion has heard in years. 
We have received many calls and emails from our members 
expressing alarm.
    I personally spoke to a veteran who began crying as he 
explained to me that he would literally lose his home if his IU 
benefit was cut. Additionally, the President's proposed budget 
would also round down to the nearest dollar the annual cost-of-
living adjustment. Like IU, this is a bad idea, and The 
American Legion opposes this. The simple reality, we should not 
be asking veterans to pay for their own earned benefits.
    Chairman Wenstrup, Ranking Member Brownley, Chairman Roe, 
and Members of this Committee, it is my honor and duty to share 
the American Legion's analysis of the President's budget with 
you, and I very much look forward to answering any questions 
you may have. Thank you.

    [The prepared statement of Matthew Shuman appears in the 
Appendix]
    Mr. Wenstrup. Thank you.
    Dr. Alaigh, you are now recognized for 5 minutes.

                STATEMENT OF POONAM ALAIGH, M.D.

    Dr. Alaigh. Good afternoon, Chairman Wenstrup, Ranking 
Member Brownley, and Members of the Subcommittee. Thank you for 
the opportunity to appear before you to discuss the Veterans 
Health Administration's fiscal year 2018 budget submission and 
fiscal year 2019 medical care advanced appropriation request. I 
am accompanied today by Mark Yow, our CFO at VHA.
    By way of introduction, I have served as a physician and a 
health care executive in both the private sector and the 
government sector for over 25 years. I have also served as a 
frontline physician at the VA medical center in New Jersey for 
over a decade.
    Then, as now, I have continued to learn a great deal from 
my patients. My respect for the selfless men and women only 
grows deeper each day. I am grateful to be here in support of 
veterans and VHA employees. I believe that it is my personal 
mission, responsibility, and privilege to support them in every 
way that I can. Because of their sacrifices and service, I am 
committed to making sure veterans receive the very best care 
anywhere.
    The 2018 budget request will allow VHA to continue on the 
path begun by then-Under Secretary Shulkin towards improving 
the timeliness and quality of care. This also fulfills the 
administration's strong commitment to all of our Nation's 
veterans by providing the resources necessary to support those 
who have earned this care through sacrifice and service to our 
country.
    This budget is not designed to privatize the VA but, 
rather, to get the veterans the best care when and where they 
need it. Our goal is to make VA strong. We are committed to 
making VA services best in class.
    Suicide prevention is our most important clinical priority 
at the VA, and it is critical that we make suicide prevention 
everybody's priority.
    We have thousands of health care professionals helping save 
lives of veterans every day. Our veterans' crisis line 
continues to do amazing work. Since its inception, the VCL has 
answered over 2.9 million calls, dispatched priority services 
and rescues to over 77,000 veterans, and referred 470,000 
veterans to local VA suicide prevention coordinators. We have 
also launched REACH VET, a program that analyzes veteran data 
and identifies those veterans at increased risk for suicide and 
hospitalization. We are also training all the staff through 
Operation SAVE, teaching everyone to recognize the danger signs 
of suicide and the steps to be taken to prevent this tragic and 
unnecessary death.
    There are many examples of VA employees that have helped 
prevent a veteran suicide. For example, a VA employee saw a 
veteran on the ledge at the top of a VA parking garage. He 
looked depressed. This employee sent one of her colleagues to 
get the police while she calmly talked with him until they 
arrived and saved his life. This is just one story. We will 
continue to focus on these critical issues.
    Another one of our priorities to which I am deeply 
committed is ensuring veterans have timely access to care. VA 
is taking steps to expand capacity at our facilities by 
focusing on staffing, space, and productivity. We are also 
increasing transparency and empowering veterans to make more 
informed decisions about their health care through our new 
access and quality tool, accesstocare.va.gov. This tool will 
instill a spirit of competition and encourage our medical 
facilities to proactively address access and quality issues 
while empowering veterans to make choices according to what 
works best for them and their families.
    It also allows veterans to access the most transparent and 
easy-to-understand wait times across the VA and quality care 
measures across the health care industry.
    We are in the process of redesigning and modernizing VHA, 
and this budget supports those efforts. We must recognize we 
must address community care access and are committed to 
streamlining and improving it.
    A redesigned community care program will not only improve 
access to veterans but will also transform how VA delivers care 
within our facilities. Community care access must be guided by 
principles based on clinical need and quality. VA will continue 
to partner with Congress and the other stakeholders to achieve 
our common goal of providing the best care we can for our 
veterans.
    Additionally, as you know, Secretary Shulkin announced that 
VA will start the process of adopting the same electronic 
health record as DoD to ensure continuity of care between the 
two Departments. We will incorporate the lessons learned 
through our pioneering work on VistA as we move forward. We 
will also be creating an integrated EHR product, that, by 
utilizing the same DoD platform, will require meaningful 
interface with other vendors to create a seamless system that 
serves the veterans in the best possible way. We believe that 
this product will serve as a model for the Federal Government 
and health care across the country.
    Finally, VA is committed to providing the highest quality 
of care which our veterans have earned and deserve. I 
appreciate the hard work and dedication of all of our 
stakeholders. We are all committed to making VA strong, and 
this budget does that.
    I look forward to continuing our partnership with this 
Subcommittee and the entire Congress and to work together to 
continue to enhance the delivery of health care services to our 
Nation's heroes. I know you share my personal commitment to 
make sure veterans get the very best of care.
    Mr. Chairman, Members of the Subcommittee, thank you, 
again, for this opportunity to testify. My colleague and I are 
here to answer any questions.

    [The prepared statement of Poonam Alaigh, M.D., appears in 
the Appendix]
    Mr. Wenstrup. Thank you all very much.
    I now yield time for myself for questions.
    I would like to start, Dr. Alaigh. In response, for the 
record, to our hiring hearing that was held in March of this 
year, we were told that there are currently 38,000 vacancies 
across VA as of April 24, 2017. That is using data from VHA's 
web HR system. So, when VA states that they have a certain 
number of vacancies, are those positions considered funded, and 
by that I mean appropriated funds that are available to fill 
those positions? Then, if they are not expended for the 
position, what happens with them? Does that money gets 
rescinded or rolled over if not used, or is it repurposed 
within a particular budget line?
    Dr. Alaigh. Thank you, Mr. Chairman, for the question. Our 
goal at the VA is to make sure that our veterans are getting 
the highest quality of care with the greatest amount of access.
    In this year's budget, we budgeted about 7,000 additional 
FTEs. And if those FTEs are not filled, those dollars go back 
to providing care through the discretionary funding. So, if our 
veterans have to go into the community, then those dollars go 
back in terms of ensuring that our veterans are getting care 
either inside the VA or outside the VA.
    Mr. Wenstrup. So it goes back into caregiving specifically?
    Dr. Alaigh. Yes.
    Mr. Wenstrup. Thank you.
    Ms. Ilem, Mr. Blake, Mr. Fuentes, Mr. Shuman, I understand 
your expressed opposition to the proposals in the budget 
request to enact changes, especially rounding down the cost-of-
living adjustment, COLA, to the nearest dollar, which, of 
course, at most would cost a veteran $12. I understand the 
principle of the whole thing. I get that.
    But at the same time, when I am in my district, and I am 
talking to veterans, and I ask them, and they are concerned 
about certain programs, certain benefits that we have been 
talking about and they would love to see enacted, I ask them, I 
said, ``Would you be willing to round down,'' and explained to 
them what that means, every one of them said yes. You know, 
they get it in principle. But you know what? Veterans do that 
for veterans.
    So I am a little confused on that one, because it is not 
what I am getting from the individual veterans, but we always 
get it from the VSOs. And it has been done in the past.
    And, you know, some of those very veterans may benefit from 
the program that at most would cost them $12 a year and at 
least 12 cents a year. That is pretty good insurance policy for 
some of these types of benefits that they can receive.
    So I am feeling a little bit differently on that particular 
topic when I am out talking to veterans. And I think that that 
needs to be considered.
    We heard a lot of things you are concerned about, and I 
appreciate you bringing those up. And how do we go about 
funding and where do the moneys go, that is a big discussion to 
have. But I really didn't hear many solutions, and I would 
really like to hear some viable solutions, some actual, 
realistic solutions you have as to how we can increase our 
funding and find pay-fors or get offsets within. So I would 
like to ask each one of you, if you can comment quickly--if you 
can discuss these with us.
    We can go down and start with Ms. Ilem.
    Ms. Ilem. I don't have any specific offsets that we can 
share. I think one of the things, based on our resolutions that 
we receive from our membership was really put forth what we do 
legislatively, you know, talks about specific issues of 
offsetting veterans--you know, one benefit to a veteran to, you 
know, pay for another program. And I think the concern is, you 
know, throughout our organization, that we want to make sure 
that programs for disabled veterans are provided to them based 
on their military service, and we don't want to see an 
interference or trying to take away another benefit from 
another group of veterans.
    Mr. Wenstrup. Mr. Blake?
    Mr. Blake. Mr. Chairman, I think the question somewhat 
presupposes that in order to get to an increased level of 
funding you would have to offset or find a pay-for or something 
like that. I think the first thing we need to do is be honest 
with exactly how much it is going to cost to provide services, 
because I think we are--I think what we are missing here is, in 
the early part of the process of budget development, a lot of 
the cuts and reductions and figuring out ways to tamp down how 
much we are going to request takes place within the confines of 
the Office of Management and Budget, and we never get to, what 
does it actually take?
    I mean, the independent budget puts our recommendations 
forward, and our numbers are basically our belief of what it 
takes to provide care. I don't sympathize with the position 
that you are in, that you have to figure out how to get to 
those numbers. But, truthfully, I see that as a congressional 
problem, not our problem. Our problem is we tell you this is 
what we think it takes, and you have to deal with the political 
consequences of cutting or offsetting.
    Mr. Wenstrup. Yes. And that is the reality.
    Mr. Blake. Sure.
    Mr. Wenstrup. Okay? So that is the reality we have. And 
since I have been here for 5 years, there are things that I 
know we are way overspending, and we have made some changes and 
working on some of those changes to bring costs down in other 
areas. And particularly near and dear to my heart is to get 
more care to the patients and to our veterans in that regard. 
That should be the highest priority, especially as we are 
dealing with this today.
    But you can't ignore the reality. And so we are asking you 
for you to help, because you know what? We are all in this 
together. And that is the point I would like to make. So I am 
asking--you know, you talk to veterans. You represent veterans 
that are going through the process, and they do a lot of 
talking, and it is a good thing they do, but if they can come 
back with some evidence and say, ``Hey, you know what I have 
observed and maybe this is the way we can do it,'' we will take 
those solutions. So I understand the complaints and the 
concerns, but solutions are helpful to us.
    Mr. Fuentes.
    Mr. Fuentes. Just to add to what you were mentioning, Mr. 
Chairman. You know, there is fraud, waste, and abuse in the 
system that must be eliminated. There are inefficiencies that 
must be corrected. You know, there was just a release--I don't 
know the number exactly off the top of my head--about $26 
million or so that the Secretary estimates to be able to 
eliminate in terms of his fraud, waste, and abuse task force. 
That is certainly the right approach, finding where to do that 
without hurting veterans.
    But, frankly, you know, there are these improvements that 
are much needed. There is also nothing that says that it has to 
come from VA's budget, right? You have congressional rules that 
say that discretionary funding, mandatory funding, needs to be 
offset, but that doesn't say that it has to come from this 
Committee's jurisdiction.
    Now, I understand that the complications that come with 
that. But, also, frankly, and it has been the VFW's position 
for quite some time, sequestration has a lot to do with why VA 
is receiving--is not able to ask what they need and why 
Congress isn't able to give them what they ask for.
    And we have said for quite some time, and hopefully you 
agree we need to end this, you know, setting arbitrary budget 
caps 10 years ago that are no longer, you know, realistic.
    Mr. Wenstrup. Mr. Shuman.
    Mr. Shuman. Thank you, Mr. Chairman, for the question. You 
are absolutely right. We are absolutely in this together.
    The first thing I want to sort of point out here is that 
this country has made a promise to veterans. And my colleagues 
here are right in that the money does not always have to come 
from the jurisdiction of this Committee.
    During his campaign, the President made a promise that he 
was going to do the right things for veterans, and we want to 
hold him to that. So we are standing by willing to work with 
you and the White House to get the funds necessary to be able 
to take care of the veterans.
    To go back to the first point--and sorry the time is over--
our members, thousands of them, have to vote on our 
resolutions, millions, in order to get where we are. And, 
currently, our members are telling us that they are not 
supportive of the COLA round down. So I would love to talk you, 
to the constituents you have, and I would love to make sure 
that our members are speaking with your office as well.
    Mr. Wenstrup. I am telling you that anecdotally. It is not 
a scientific study, and it is a not a poll or anything like 
that, but I just ask the question. I appreciate the input.
    And you might understand that it is difficult for any one 
committee to tell another committee of jurisdiction that they 
have to start giving up things. So I think you appreciate that.
    Mr. Shuman. We will tell them for you, Mr. Chairman.
    Mr. Wenstrup. Ms. Brownley, you are now recognized.
    Ms. Brownley. Thank you, Mr. Chairman.
    I think Mr. Blake pretty much laid it out in his testimony 
about where the challenges are here in terms of ensuring that 
we maintain and improve upon the programs we have promised to 
our veterans and to be able to fund all of the programs.
    And with regards to some of these offsets and we--Ms. 
Alaigh talked about the IU benefit as one example. And, 
certainly, the Secretary did, in his testimony, kind of back 
off of that as a way in which to help finance the Choice 
Program.
    But in your testimony, you still state that it is 
potentially still on the table as an offset. So I just wanted 
to clear that up. If we can clear that up today, or I am 
wondering if you have a different perspective.
    Dr. Alaigh. Thank you, Congresswoman. As the Secretary has 
said, he would never do anything that puts our vulnerable 
veterans in a compromising position, and so he has committed to 
looking for another solution besides the IU at this point and 
working with all of you on that.
    Ms. Brownley. And so are--is that something that you and 
your staff and Secretary are all are working on?
    Dr. Alaigh. Yes, we are all going to work together on it.
    Ms. Brownley. And do you have some sense of when--you know, 
when you will be able to share that with the Committee so we 
actually know kind of what we are really dealing with here? 
Because, right now, it just seems like we are going to figure 
it out. But--I think this is the time when we are supposed to 
be really reviewing and digesting a budget so that we can 
respond to it. So it is difficult when we do not know.
    Dr. Alaigh. Absolutely. We will share it with you as soon 
as we are ready to share what our alternatives are.
    Ms. Brownley. Okay. And the same for the Staab ruling and 
the emergency care nonservice-connected conditions. There is 
another, you know, sort of a blank there for how we are going 
to backfill a $1.5 billion without taking away items like the 
Choice Act. So I hear you are going to be working on it, and I 
think--you know, I am not sure when we will--but it seems like 
we will have to reconvene another hearing similar to this one 
to get some of those responses back, Mr. Chairman.
    And, you know, the transferring authority, too, is that 
still something that you believe is on the table to solve all 
or part of this problem? And if you could talk a little bit 
about that.
    Dr. Alaigh. Thank you, Ranking Member. At this point, there 
are three options that we are exploring. The first option is 
something that we have already done, which is ensure that the 
Choice Fund continues until the end of this fiscal year. And to 
do that, what we have done is made sure that the accounts, the 
Choice accounts, are being used for the 30-day/ 40-mile rule, 
and then for everything else that our veterans need outside of 
the VA, we are using the community care funds for that.
    That will take us--and we are managing that on a daily 
basis. That should take us along with the community care funds 
to the end of the fiscal year. However, it will be at the 
expense of Choice being trimmed down significantly.
    The other options are the transfer authority or infusing 
new funds into the mandatory funding stream in order to make 
sure Choice continues at the same pace.
    Ms. Brownley. Okay. Seems like we still have a lot of work 
cut out in order to figure out how we are going to, truly 
support these very, very important programs for veterans.
    On the IVF and adoption regulation that has gone through, I 
know that we have--the rulemaking has been done, the IVF, and 
that program is, I think, under way as we speak. And that is 
good news. I still do not believe we have a rule, regulations 
for the adoption piece of that.
    So I was wondering how we are progressing on that.
    Dr. Alaigh. So the IVF program, you are absolutely right. 
We have about 37 families who have already contacted us to be 
part of that program, and we are supportive of continuing the 
program to the next year. I will get back to you on the 
adoption rules and where they are at this point, but we are 
definitely--I mean, that is part of supporting the whole 
women's health and overall programs.
    Ms. Brownley. Thank you very much.
    My time is up. I yield back.
    Mr. Wenstrup. Mr. Bilirakis, you are now recognized for 5 
minutes.
    Mr. Bilirakis. Thank you, Mr. Chairman.
    I thank the panel for their testimony today.
    And I thank our veterans for their service.
    Dr. Alaigh, I am hearing an uptick in the complaints and 
concerns about community providers about the VA's ability to 
comply with the VA prompt pay rules. Particularly providing the 
expected community care funding shortfall announced just last 
week, how does this budget support improvements to VA's claims 
process system, and what, if any, changes are needed in order 
for VA to fully comply with the prompt payment rule? And then 
can you say anything to assure providers and encourage them to 
keep accepting VA patients?
    I will tell you that the providers I speak to, the 
physicians I speak to, want to see veterans. They feel like it 
is their duty and obligation to see veterans in the community. 
But they are having a hard time getting paid. And you probably 
hear it. I think, probably some of my colleagues do too. How 
could we solve this quickly, because it is a great alternative 
to the VA, not to--you know, I love the VA. I think that the 
care is very good in most cases, but as an alternative, some of 
our veterans want to see private physicians. So please answer 
that question for me. I appreciate it.
    Dr. Alaigh. Thank you, Congressman. I have to tell you, as 
a physician, it is just an honor to serve veterans, and there 
isn't a single physician who--who doesn't get touched by 
serving a veteran and taking care of a veteran. And I hear the 
same complaints that you do in terms of prompt payment but also 
of your process where there is a lot of administrative hassle. 
And so what we have done is simplified the process at least for 
the time being where we are requiring less of administrative 
back and forth and paperwork that they have to submit to 
streamline the process.
    We still have 20 percent of clean claims that are not paid 
within 30 days, and that is a problem. And so we are working 
with our TPAs. Our payment to the TPA is within 30 days. The 
TPAs then have to pay their provider. And so this is one of the 
areas of focus. The TPAs are willing to work with us, and we 
are looking at ensuring streamlining and automating of 
processes to ensure that our providers are getting paid.
    In the new RFP that is out, we are going to have much more 
rigorous and stringent rules and expectations on the prompt pay 
piece of it. Whatever we are hearing about issues are things 
that we are incorporating into our new RFP process that is 
going to be awarded the first part of the next fiscal year.
    Mr. Bilirakis. How are you utilizing the Federal qualified 
community health centers? Is there a path there? I mean, would 
they be an alternative? I know you are utilizing them to a 
certain extent. If you can elaborate on that, I appreciate it.
    Dr. Alaigh. Yes. They play a critical role in terms of 
access, especially in those critical access areas where we need 
to meet the needs of our veterans. So we are in discussions. We 
have an MOA with HRSA to ensure that the FQHCs are part of our 
network as we send our veterans out into the community.
    Mr. Bilirakis. Okay. Next question: In your budget, what 
steps have you taken to ensure that complementary and 
alternative therapy services are available to our veterans? 
That is very important, and I know that the Committee really 
cares about that. I sponsored the COVER Act, it passed last 
year. I want to know the status, the President is going to 
nominate two veterans, hopefully, two veterans on the Committee 
soon. You know, based on the budget, in the budget, tell me how 
we are utilizing--has it increased? Do you plan an increase so 
that veterans have access to complementary and alternative 
therapies that are, obviously, certified, but I know they work, 
and I think the veterans should have the choice to seek what 
type of therapy works for him or her.
    Can you give me an update on that, please?
    Dr. Alaigh. Yes, sir. The complementary and critical 
medicine is a core piece of how we provide whole health for our 
veterans, and what we have is 18 flagship sites that are going 
to be launched in October of this year, one in each VISN, that 
actually delivers a whole health model. And in that whole 
health model, you have three prongs. One is to make sure that 
our veterans are empowered and they come up with their own life 
plan. The second piece is to equip them, and equip them means 
to have access to complementary and integrated medicine. And 
the third piece is treating them. But complementary and 
integrated medicine is an important part of taking care of our 
veterans who are dealing with severe pain conditions and opioid 
addiction and some of the other very difficult-to-treat 
conditions.
    Mr. Bilirakis. Thank you. So, if you can give me an update, 
follow up on this with regard to the COVER Act. I know that the 
Secretary--I have talked to the Secretary, and he just 
submitted names to the President. I wanted to see where we are 
on that. If you could get back to my office, I would really 
appreciate it very much.
    Dr. Alaigh. Yes, I will.
    Mr. Bilirakis. Thank you.
    And I yield back, Mr. Chairman.
    Mr. Wenstrup. Mr. Takano, you are now recognized.
    Mr. Takano. Thank you, Mr. Chairman.
    Mr. Blake, how important is it to VSOs or to your VA--how 
high a priority is it that the 38,000 unfilled positions at the 
VHA get filled?
    Mr. Blake. I would say it is critically important, even 
from the--taking it down to the more narrowly focused SCI 
level, we have been working closely with the VA to fill 
approximately 1,000 nurse staffing positions alone in the SCI 
system of care. It ranges somewhere between 900 and 1,100, but 
that is just a small snapshot. And that is just in the SCI 
service alone. If you take that out to a much wider net, I am 
sure that it is critical to ensuring the VA can function at its 
maximum capacity.
    Mr. Takano. Mr. Fuentes, how high a priority is it for you, 
for your position?
    Mr. Fuentes. In the past 3 years in serving our members on 
VA health care six times and every single time we ask them, how 
would you improve the VA health care system, the number one 
answer is hire more doctors. So it is very important to our 
members. That is what they want to see.
    Mr. Takano. Mr. Shuman?
    Mr. Shuman. Thank you, sir. It is absolutely critical. I 
mean, staffing bleeds into every single--beyond VHA, every 
single element of the VA, so it is absolutely critical.
    Mr. Takano. I passed you last time. I am sorry. My eyes 
are--Ms.--
    Ms. Ilem. Ilem.
    Mr. Takano [continued]. Ms. Ilem. Sorry.
    Ms. Ilem. Thank you. Yes, absolutely critical to DAV 
members as well. Hiring at the VA health care system and having 
access to those providers, you know, plays into having timely 
access to care.
    Mr. Takano. So, Dr. Alaigh, did I hear you correctly answer 
the Chairman that all of the 38,000 positions that are unfilled 
are funded?
    Dr. Alaigh. So, Congressman, we have a steady state of 
attrition and hiring, and that steady state for an 
organization--
    Mr. Takano. I don't have much time. Can you just answer the 
question? Are they funded?
    Dr. Alaigh [continued]. There are 7,000 positions that are 
funded.
    Mr. Takano. So 7,000 of the 38--so not all of the 38,000 
are funded?
    Dr. Alaigh. There is a 30,000 steady state of positions, 
positions that come and go at any given different time. So our 
steady state is 30,000.
    Mr. Takano. I am confused by your answer, because I am 
hearing 38--the Chairman himself used a figure of 38,000 
unfilled positions, and you answered affirmatively that they 
were funded.
    Dr. Alaigh. We have funded for 37,000 positions, 30 being 
the steady state and 7,000--
    Mr. Takano. Okay. So 37,000 are funded. Okay.
    Dr. Alaigh [continued]. Yes.
    Mr. Takano. So out of the 37. That is quite--that is quite 
a lot of money that is not being spent. You said that money 
does get spent, though. It gets spent on community care. Is 
that what I hear you are saying?
    Dr. Alaigh. We can hire. But it is the goal to make sure 
that our veterans are receiving care.
    Mr. Takano. How big of a commitment is it for--how high a 
priority is it for the VA to fill those positions?
    Dr. Alaigh. This is a very big priority, one of our top 
priorities for the VA.
    Mr. Takano. It seems to be a persistent issue, though. 
Every year, we see the positions unfilled. I kind of see that 
you are trying to fill up community care funding, that there is 
this perverse incentive for the VA to not fill those positions 
and use those savings to fund community care. Have you--there 
is lot of money being spent on community care. Do they all 
spend money?
    Dr. Alaigh. No. The money is being spent to hire our staff, 
our employees, and if the--all the money is not spent, it goes 
into direct patient care services.
    Mr. Takano. Well, does that--has all that money been spent? 
Has all the money been spent?
    Dr. Alaigh. I will have Mark--
    Mr. Takano. I realize it gets spent on patient care, but it 
gets spent, looks likes, on other programs.
    Mr. Yow. Yes, sir. I think what Dr. Alaigh was trying to 
explain: Typically, we have a large number of vacancies that 
are open with the turnover that we experience. We have more 
than 300,000 employees across the VA. No position gets 
advertised unless the VA medical center believes they have 
funds to support it. We have 7,025 FTEs--that is a full-year, 
full-salary, full-time equivalent position--funded in this 
budget for growth to--with that steady turnover. So, if you are 
looking at some number above 30,000 vacancies, remember, a lot 
of that is turnover. It doesn't mean there is extra money 
sitting anywhere that would be used otherwise.
    We have talked about the fact that creation of the medical 
community care account has eliminated the opportunity at the 
medical center level to move money from in-house care inside 
the VA medical center to community care and back when those 
positions are vacant.
    If you are missing a surgeon for some period of time, you 
will have to send that care out in order to continue to provide 
care to veterans. If we are able to hire that surgeon back, you 
would like to be able to bring those moneys back from community 
care and put it into our direct care system. So that is what 
she is trying to describe.
    Mr. Takano. All right. I am still--I feel like I need to 
spend--my time is out, but I would like to understand more 
about how this works, because I am very frustrated, and I think 
the VSO is very frustrated that we have all those positions 
vacant. I am trying to understand what--it is more than just 
the money issue. But I don't want to be--I want to be courteous 
to the Committee.
    Dr. Alaigh. I think just the one thing that we have lost as 
a result of this is our three Rs--so recruitment, retention, 
relocation--incentives to make this competitive with the 
community and the marketplace. You know, we have lost, and that 
has made it a little more challenging to bring in employees 
into the system.
    Mr. Takano. Well, thank you, Dr. Alaigh.
    Mr. Wenstrup. Mrs. Radewagen, you are now recognized for 5 
minutes.
    Mrs. Radewagen. Thank you, Chairman Wenstrup and Ranking 
Member Brownley, for holding this hearing today.
    Thank you, Under Secretary Alaigh and the VSO 
representatives on the panel, for taking the time to testify, 
and we appreciate you being here.
    As you know, this budget request calls for increases to 
veteran services across the board. And in that regard, I would 
like to praise the Department for their commitment to caring 
for our Nation's heroes. I hope to continue to work with VA to 
bring further improvements to veterans' health care and 
accessibility services, especially for veterans out in rural 
and remote areas like my own home district, American Samoa.
    However, as is usually the case, there is still much work 
to be done. For example, I would like the VA to work in 
conjunction with DOT and other related departments to make 
improvements to LBJ hospital, the only hospital in the 
territory, which currently cannot treat our veterans due to 
lack of adequate resources.
    As it stands, our veterans must be flown to Hawaii and put 
up in a hotel for several days on the taxpayers' dime to 
receive even the most basic care. Last year alone, $3.2 million 
was spent on that exercise alone. That is a lot of money.
    This budget is a good first step, I think, and I look 
forward to more improvements to veteran services to come, 
especially for our veterans in the remote U.S. territories.
    Mrs. Radewagen. My question for you, Dr. Alaigh. The budget 
cites that the Supportive Services for Veteran Families Program 
has a presence in all 50 States, including Puerto Rico, the 
District of Columbia, Guam, and the Virgin Islands, but does 
not include American Samoa. Does this mean that SSVF services 
are unavailable in my territory?
    And to follow up, how do the needs of homeless veterans and 
their families vary by geographic region? Specifically, how 
does the VA work to address the needs of homeless veterans in 
rural communities that may be particularly isolated from 
services?
    Dr. Alaigh. Thank you, Congresswoman.
    We are committed to serving veterans regardless of where 
they are. And so if this is a specific issue in the Samoa 
Islands, we really do want to look into it further.
    Since we contacted your office, we are already starting to 
work with the local hospital there, which is a government 
hospital. We are looking for ways to collaborate with them, 
because we are two governmental agencies, and we are going to 
continue making sure that we synergize our efforts. And if 
there are still gaps in services, then we will work together on 
those.
    Mrs. Radewagen. Thank you, Mr. Chairman. I yield back.
    Mr. Wenstrup. Thank you.
    Ms. Kuster, you are now recognized.
    Ms. Kuster. Thank you, Mr. Chairman.
    And thank you to the Committee, to the panel, for being 
with us today. We appreciate it.
    I wanted to ask about the issue about consolidated 
community care network that was outlined in the VA report, this 
was late 2015, and get back to the question that Mr. Bilirakis 
had started about the Federally Qualified Health Centers.
    My question is, has the VA developed this plan any further 
to integrate these facilities, especially with regard to this 
moving to an off-the-shelf health record? And is that a barrier 
or will that be helpful to integrate the Federally Qualified 
Health Centers?
    Dr. Alaigh. Thank you, Congresswoman.
    Our goal is that veterans get seamless care regardless of 
where they are getting care. Going down the path of adopting 
the DoD EHR platform is only our first step. And it is very 
clear as we are moving down this path that the interoperability 
and the seamlessness of connectivity has to happen with all of 
our community providers, like FQHCs, and our private physicians 
at the same time.
    Ms. Kuster. Okay. And then continuing that train of thought 
about the adequate funding, whether there is sufficient funding 
to successfully implement the evolution of the electronic 
health record, how much money will the VA require in the fiscal 
year 2018 budget to implement the evolution? Because I recall 
Mr. Shulkin saying the moneys are not included in this budget 
request.
    Dr. Alaigh. Yes, that is an important question to ask, 
because this is a huge implementation that is going to take 
years. But the most important thing, and having learned from 
the DoD experience, the first 2 years is really about change 
management, going through the specifications and making sure 
the standards align.
    And so for the first 2 years we have enough in the budget 
to be able to support the field assessments, going through the 
specifications, and doing change management. It is going to be 
in year 3 that we are going to be asking for additional and 
significantly additional funding to be able to implement it.
    Ms. Kuster. So we shouldn't expect a supplemental budget 
request for fiscal year 2018?
    Dr. Alaigh. No.
    Ms. Kuster. You are saying it would be 2020.
    Dr. Alaigh. It won't be in 2018.
    Ms. Kuster. Okay. Okay.
    The other reason that I am concerned about the requested 
funding for the IT system, it seems too low to accommodate 
simultaneous transformations of the electronic health record as 
well as financial management system, antiquated benefits 
management system, and one that I continue to try to pursue is 
a more efficient and effective scheduling system.
    So regarding the scheduling, will VA continue to pursue the 
MASS scheduling pilot, and if not, what does the VA plan to do 
to improve its scheduling software?
    Dr. Alaigh. Again, a very important point. You know, one of 
the things that has been responsible for some of our access 
issues, including discrepancies in wait times, is our complex 
scheduling system. So we are rolling out the VSE, which is an 
interim solution, while we are still doing the MASS pilot, 
because all we are doing right now is contractual negotiations 
with the DoD product.
    So in the meantime, we still are moving ahead with rolling 
out VSE, which is going to be our interim bridge, and then also 
seeing what the MASS pilot demonstrates, because we will have 
lots of learnings just doing that pilot. And we still want to 
have options of the best software modules to be able to deliver 
the best care for our veterans.
    Ms. Kuster. Well, many of the Members of this Committee 
were on the Committee when the Phoenix scandal was all over the 
news, and we certainly want you to resolve the scheduling 
issues, use the resources and the personnel that we have 
efficiently, and not end up back here daja vu all over again. 
So I will wish you well with that.
    One last, very quick question. I just have 30 seconds. I am 
concerned that the VA is not requesting adequate funding for 
medical research programs, and in particular the research 
around pain management and use of opioids to bring down the use 
of opioids in the system so that we don't continue to create 
more and more and more people with substance use disorder, 
veterans that are addicted to opioids, heroin, now fentanyl.
    Is there anything that you could say to comment on that?
    Dr. Alaigh. A third of our research funds do go into mental 
health and substance abuse, including PTSD, suicide, 
depression. We are going to continue down that route. We will 
have to look for additional partnerships and other sources of 
funding, because we are a leader in research. We come up with 
breakthrough research. The rest of the country follows us. And 
so we are going to continue that momentum, you know, in that 
current environment.
    Ms. Kuster. Thank you very much. I yield back.
    Mr. Wenstrup. Dr. Dunn, you are now recognized.
    Mr. Dunn. Thank you very much, Mr. Chairman.
    Dr. Alaigh, what will be the impact on veterans care if 
Congress does not act to replenish the Choice Fund, and when 
will those consequences be felt?
    Dr. Alaigh. This is a serious concern. And we have a plan 
that we have implemented right now, because under no situation 
can our veterans ever not have access to high-quality care.
    So what we are doing right now is managing the two 
accounts, the Choice account and the Community Care account, 
and making sure that both those accounts last until the end of 
this fiscal year.
    There will be unintended consequences if we continue down 
this path because the Choice accounts will start to be used 
very judiciously. And so I do know that the TPAs have put in a 
lot in terms--
    Mr. Dunn. Let me interrupt you, if I can right there. The 
TPAs, you made mention of those earlier, and it sounded like 
you were saying they were the problem paying on time. I was 
surprised that you farmed out the third party--the 
administration of the Choice funds to some external consultant.
    Dr. Alaigh. So this was a program that was stood up in 3 
months. And if you look at any other managed care organization, 
it takes decades to stand up a program like this. And so we are 
still dealing with bumps along the way, and this is one of the 
things that we are going to have to work on.
    Mr. Dunn. Are there other, less mission-critical areas that 
you could tap the money from in the VA for the Choice Program?
    Dr. Alaigh. We cannot transfer funds from the discretionary 
accounts into the mandatory accounts. So we cannot transfer 
funds--
    Mr. Dunn. So maybe from the mandatory--other places 
mandatory cannot.
    Let me change tacks here just for a minute. The vision 
statement attached to the budget said that the VA will focus on 
its foundational services, the ones that they can excel in. 
What are those foundational services?
    Dr. Alaigh. So right now we know the foundational services 
are primary care, mental health, SCI, polytrauma, prosthetics, 
mental health. All those are our foundational services, but 
depending on the marketplace, we will add additional 
foundational services, for example, high-volume medical 
specialties, some surgical specialties.
    Mr. Dunn. So let me take a dive at the surgical specialties 
really quickly, one that is near and dear to my heart as I was 
a former transplant surgeon.
    It is my understanding that the veterans who often need 
transplant care have to travel hundreds or thousands of miles 
to receive their transplant care, and then it may not even be 
done at the VA transplant center. It might be in an academic 
affiliate.
    Why is the VA hesitant to let veterans pursue transplants 
in the transplant centers, certified transplant centers, near 
their home where we know the transplants are more successful 
and they are much more likely to get the transplant?
    Dr. Alaigh. Yeah, you are absolutely right, Congressman 
Dunn. This is an area that we have to redesign and change, 
because as long as the transplant centers have the best 
possible outcome after the surgery and have the team that can 
best manage it, we should be opening up the networks, and we 
are already doing that in certain cases.
    Mr. Dunn. So I can interpret that as that policy is going 
to go away. We are now going to be able to use the transplant--
my veterans in Florida are going to be able to use the 
transplant centers in Florida and they will not have to go to 
Pittsburgh or--
    Dr. Alaigh. We are doing a market analysis, and we are 
going to finish that market analysis in a year, and after that 
we will show you. But in the meantime, case by case, we are 
making exceptions and making sure that our veterans are going 
to the best possible places.
    Mr. Dunn. All right. In the little time left let's take a 
look at the $226 million line item for modernization and 
interoperability of the VistA health record system, which I 
gather we are abandoning, right? We are walking away from that, 
going onto the DoD system. $226 million for a system we are 
leaving? Help me.
    Dr. Alaigh. This includes the change management that we are 
going to be doing as we are rolling out the new EMR.
    Mr. Dunn. You are saying that is the cost of adoption 
upfront?
    Dr. Alaigh. Yes.
    Mr. Dunn. $226 million?
    Dr. Alaigh. And also maintaining our legacy VistA systems 
along the way.
    Mr. Dunn. Thank you.
    I yield back, Mr. Chairman.
    Mr. Wenstrup. Mr. Higgins, you are now recognized for 5 
minutes.
    Mr. Higgins. Thank you, Mr. Chairman.
    Dr. Alaigh, thank you for your service.
    I would like to follow up on what my colleague asked. Why 
does it take a year to figure out what everyone in this room 
knows is already an accurate conclusion? A veteran should be 
able to get a transplant in his own home State. This is just 
common sense.
    This is the type of thing that we are tired of. This is the 
kind of thing that veterans from sea to shining sea come to a 
veteran like me, as a Representative, and they say, ``Captain, 
why don't they get it in D.C.?''
    So please tell us, why does it take a year to figure out 
what this distinguished surgeon has come to the conclusion of 
already and, I imagine, the other doctors on this Subcommittee? 
Why a year?
    Dr. Alaigh. Again, a very valid concern. As you know, the 
VA delivers some of the best outcomes in quality care, and in 
order to ensure that our veterans are getting the highest 
quality of care, we are going to be doing an analysis of all 
the services that should be provided inside the VA versus--
    Mr. Higgins. And what does that cost? Because we have just 
arrived at that conclusion, it costs nothing.
    Dr. Alaigh. And, Congressman, it is not just for transplant 
services that we are looking at. We are looking at hundreds of 
different types of specialties and services, and at the same 
time looking at veteran demand. We are looking at reliance. We 
are looking at what the highest performing providers are in the 
network.
    Depending on where our veterans get care is directly 
correlated with the outcomes for our veterans. And we want to 
make sure our veterans are getting the best possible care.
    Mr. Higgins. Thank you for your patient response, ma'am. 
Please understand my passion is strictly reflective of my love 
for our veterans.
    Dr. Alaigh. We are on the same side.
    Mr. Higgins. All of us, in one way or another, continue to 
serve our country. I thank the veteran service organizations 
present. You have been very helpful to my office. In 
particular, Matthew Shuman, the director, has been very 
interactive with my office in helping us as we move forward.
    In talking about the budget, as soldiers, sailors, airmen, 
and marines, we recognize sacrifice for our country. And please 
let us note that the VA and the VHA has received a significant 
increase in funding despite the fact that our Nation faces a 
$20 trillion debt. That is the people's treasure that we must 
protect.
    And despite that we exist in an era where we face such a 
danger to the future of our country, the VA and VHA have 
received a significant increase in budget, which I believe is 
reflective of the spirit of this Subcommittee and the VA 
Committee as a whole and of our President and of this body from 
both sides of the aisle.
    So my question, ma'am, if I may jump into veterans 
homelessness, the VA and many local and State governments have 
made tremendous strides in reducing the rate of veteran 
homelessness. However, nearly 40,000 veterans and their 
families still face homelessness.
    The 2018 budget requests 1.7 billion to assist homeless 
veterans and prevent at-risk veterans from becoming homeless, 
in part by building a capacity of available residential, 
rehabilitative, transition, and permanent housing supply. And 
the VA has a program called a VA Enhanced-Use Lease Program. It 
occurs to me to be a very wise investment of the people's 
treasure.
    Can you please provide information to the Subcommittee 
regarding appropriate properties that the VA could utilize for 
job training, medical services, transitional services, 
transitional housing for our homeless veterans and their 
families, please?
    Dr. Alaigh. Yes, we will.
    Mr. Higgins. And we would like those properties identified. 
If you could provide that to the Subcommittee, I would 
appreciate it.
    In my remaining 40 seconds, regarding caregivers, under the 
Program for Comprehensive Assistance for Family Caregivers, 
24,555 primary family caregivers were approved in 2016; 33,345 
in 2017; and expected 37,100 caregivers for 2018. This is 
significantly higher numbers than were expected when the 
program was initially established.
    Has the VA begun working to ensure that the Caregivers 
Program can continue to provide services and stipends to the 
veterans and caregivers most in need? And can you lay out how 
the program has and will change to ensure its longevity? This 
is a crucial program for our veterans.
    Dr. Alaigh. Yes. I mean, the Caregiver Program is a very 
important fabric of how we keep our veterans at home, 
independent, and autonomous. So we support the program. We are 
working on redesigning the program so that we can also offer it 
to the pre-9/11, the most vulnerable veterans who need it.
    But in the meantime, we have a whole compendium of services 
that we can use to help support our veterans so that they stay 
at home, our Home-Based Primary Care and Respite Program, lots 
of different other entities.
    Mr. Higgins. I applaud your answer, ma'am. And I thank you 
particularly for mentioning pre-9/11 veterans.
    Mr. Chairman, I apologize for going over time. I yield 
back.
    Mr. Wenstrup. Mr. Chairman, Dr. Roe, you are now 
recognized.
    Mr. Roe. Thank you, Mr. Chairman.
    And just an opening round, I know one of the things we hear 
every year is about how the VSOs are worried about being 
privatized. And while the Subcommittee was asking questions, I 
looked up some data. In 2009, the entire VA budget was $93.7 
billion. There were about 240,000 employees, I think, at that 
time.
    This budget request is for $186 billion. That is for fiscal 
year 2018. That is in 9 years. That is a doubling in 9 years of 
the VA budget. And the VA currently has 364,000 employees. It 
is over 100,000 more people working than 8 years ago or when I 
came to the U.S. Congress. So I don't see how in the world 
anybody can make an argument that it has been privatized.
    I think what the VA is trying to do is provide the very 
best care it can for veterans. And if they can't provide it in-
house, they wanted a way to provide it outside, just as has 
been mentioned on the transplants and other things, and I 
applaud them for that.
    And I am sorry that Mr. Higgins just left, but I was in Los 
Angeles a couple months ago and they are using property there. 
Ten percent of the homeless veterans in America are in Los 
Angeles County. And they are using a 387-acre campus, and many 
buildings that have been abandoned are not used. They are 
refurbishing those buildings for homeless veterans and creating 
a village there. And with all the other support services, with 
the HUD-VASH and so forth, it is a tremendous program.
    I was in Fayetteville, Arkansas, Monday, with the 
Secretary, and they have taken a building on the campus and 
have rehabbed it for inpatient mental health treatment up to 90 
days for alcohol and drug abuse. And we know that Medicare now 
stops paying after 15 days. You can't do the care in 15 days 
for drug abuse, and VA has recognized that.
    And so they need a shout-out for those programs that they 
are doing. There are some really good ones around the country. 
I think we hear all the bad. We don't hear a lot of times the 
good.
    We have a tremendous problem in the Budget Control Act--Mr. 
Fuentes mentioned this--with budget caps. He is correct. Our 
discretionary part of the U.S. budget has been almost the same, 
which means that we have taken away from Education and 
Department of Defense and other things to provide services for 
the VA.
    And I get a little frustrated sometimes because I know we 
have done that, and have had other requests that come on from 
educators, from people in other parts that are very needy parts 
of our society too.
    So I think this Committee has done what it can do in 
certainly listening to everybody and trying to provide every 
benefit we can for the VA.
    A question that Mr. Takano was talking about that I want to 
get a little bit clearer myself was that when that money is 
appropriated and it takes months because of the VA's convoluted 
way they fill that position, what happens to that money if you 
hired that physician on day 1, or that nurse, it doesn't 
matter, that health care provider? That money has been there 
for 6 months. What happens to that money and where is it? 
Because it is not spent, because the position isn't filled.
    I think that was your question, wasn't it? Yeah.
    So--I think I heard Mr. Yow say, and he can, Mr. Yow can 
answer if he wants to. But if a veteran like myself would come 
in and need a hernia fixed and there is no surgeon there, would 
you use that surgeon's salary that you would have been paying 
to pay for my community care? I think that is what he was 
asking. Or where is the money? Is it still there?
    Mr. Yow. Yes, sir. Remember, what we have in the budget is 
an FTE, a full-time equivalent salary for 7,000 FTE.
    Mr. Roe. That is a person.
    Mr. Yow. Over the course of the year--
    Mr. Roe. An FTE is a human being, that if you hired him 
that day would go to work and get a salary.
    Mr. Yow. It is a full-year salary for a human being, yes, 
sir. And when we are hiring new people, those 7,000 FTE may 
represent 20,000 new hires, depending on when they were hired 
during the course of the year. So it is new money that goes 
towards hiring.
    In the event that you can't hire someone, say in a remote 
location, that is what we are talking about, we used to have 
the ability when it was all within the medical services account 
to move those funds back and forth between purchasing the care, 
if we had a vacancy, or if we were able to bring somebody in, 
bring it back to provide in-house care. It still goes to care 
for veterans regardless--
    Mr. Roe. So it is. We are just not spending it on salary, 
but it would be spent on paying a physician outside. That is 
what I am trying to get to. Is that correct?
    Mr. Yow. It may well be, or it may be paid--we do something 
called fee-basis physicians where we hire a contract physician 
and bring them in-house to provide care.
    Mr. Roe. Sure, I mean, but it is paid for care. That money 
is not just sitting in an account somewhere accumulating?
    Mr. Yow. No, sir. It is used. It is all going to care for 
veterans.
    Mr. Roe. Okay. I think that wasn't clear to me either. I 
agree with that.
    I see my time has expired, Mr. Chairman.
    Mr. Rutherford. [Presiding.] Thank you, Mr. Chairman. I 
appreciate that.
    I actually have 5 minutes myself now that I have moved into 
the chair.
    Dr. Alaigh, let me ask you this. In your written testimony 
it says, ``In addition to increasing the number of veterans 
accessing care through the Choice Program, VA is working to 
increase the number of community providers available through 
the program.''
    And I can tell you, as a result of the way some of these 
providers are being paid, I just passed a letter to Chairman 
Roe earlier, a provider in Jacksonville, Florida, who is no 
longer going to see veterans because they are hundreds of 
thousands of dollars behind in payment. And there is a hospital 
who has the letter on the way that is also going to no longer 
see veterans.
    And so I am very concerned because one of the purposes for 
the Choice Program, when Congress enacted that, was because 
veterans were not receiving access to care that they needed and 
deserved. And so we now see you are trying to add facilities 
and we are losing facilities as well. So I am concerned about 
that. Can you tell me how the VA plans to address this problem?
    Dr. Alaigh. Congressman, this is an important problem and 
one of the reasons of dissatisfaction in our community 
providers. And we are working, again, very hard with the TPAs.
    But at the same time, all the learnings that we have had 
from the input that you have been giving us and we have been 
working together on with our partners here around the table, we 
are incorporating that into our new RFP process where we will 
be able to award new TPA agreements where there is more 
accountability and they are held responsible for prompt 
payments and making sure that our providers, the providers are 
satisfied as part of--being part of this network.
    Mr. Rutherford. Okay. You know, another concern that I 
have, when I hear that it is going to take a year to assess 
transplant facilities that are already certified, and VA is now 
going to do some, I guess this is like an internal 
certification that you do of your own? Is that what is going on 
here?
    Dr. Alaigh. No. This is not a certification process. What 
we are doing is, as we are looking at how we identify a high-
performing network and also identify what services we develop 
inside the VA based on region and marketplace, we are doing a 
detailed market analysis.
    Mr. Rutherford. If I can interrupt, though, these 
facilities are already certified. They are out there. Folks are 
using them every day. And so I am concerned that that is going 
to take a year.
    I am also concerned, I heard you mention that it is going 
to take 2 years to do an assessment and an alignment to figure 
out the her and the integration with DoD.
    Now, Secretary Shulkin sat at that table and said: We are 
not in the IT business anymore. We are going to go out and we 
are going to find product that meets our need. And now I hear 
you saying that we are going back to the old 2-year process of 
studying something, looking at something, figuring out what the 
elements need to be to create this integration.
    Tell me what this program needs to look like that is so 
different that it is going to take 2 years to get alignment.
    Dr. Alaigh. Congressman, any big project like an EMR 
implementation requires a lot of change management. We have 
providers, we have nurses, we have clinical teams that have 
been used to using a certain electronic health record. It is 
sort of part of the core of how we deliver care today.
    In order to make sure that the off-the-shelf product is 
customized to all the different elements of care that we have 
incorporated into the VA, because the VA does such amazing 
things with team-based care and PACT teams, we are going to 
have to customize a lot of those standards and specifications.
    That is what is going to take time. We are going to have 
the frontline physicians, nurses, all involved with this. There 
are different, like there is an OR piece. There is a behavioral 
health piece. All those things are going to happen because it 
is going to be a bottom-up approach. EMR implementation cannot 
be a top-down approach. It has to be a bottoms-up approach.
    Mr. Rutherford. Seems like you just go pick it off the 
shelf. I mean, that is what Secretary Shulkin was talking 
about.
    My time is up. Thank you very much.
    Mr. Sablan, 5 minutes.
    Mr. Sablan. Thank you. Thank you very much, Mr. Chairman. 
And I appreciate very much you allowing me to join you this 
afternoon.
    Dr. Alaigh or Mr. Yow, what efforts are being made to 
recruit and retain--well, let me go back. Let me try to 
understand, I think, Mr. Takano brought it up, you have 7,000 
vacancies or was that 37,000 vacancies?
    Dr. Alaigh. We have the budget to support a 7,000 increase 
in FTEs.
    Mr. Sablan. FTEs. And that is medical professionals or that 
includes clerical--
    Dr. Alaigh. It could be everything.
    Mr. Sablan. Everything, okay. And you already have--right 
now you have over--some 180,000 employees?
    Dr. Alaigh. Over 300,000.
    Mr. Sablan. Okay. Right. Thank you.
    So let me go parochial here. What efforts are being made to 
recruit and retain health care professionals for remote and 
underserved areas, and have they been successful?
    Let me say this. I understand that staff from the Pacific 
Island Healthcare System, from staff, that a licensed clinical 
social worker position was approved for my district in Northern 
Marianas. What is the status of that recruitment?
    Dr. Alaigh. I am sorry, for your social worker?
    Mr. Sablan. Yes.
    Dr. Alaigh. I would have to get back to you on that.
    Mr. Sablan. Okay. And if you do have that information, we 
have a way of getting out Federal job announcements on a weekly 
basis. And if you would share with us, then we could help you 
promote, provide that information in our newsletter. It goes 
out to, you know--
    Dr. Alaigh. Yes, absolutely. In fact, there are two 
programs--
    Mr. Sablan [continued].--thousands of people. Because right 
now you only have a clerk who handles appointments and a fee or 
a contracted physician. Thank you.
    You also mentioned earlier that the VA is trying to manage 
Choice so that funds last through the end of the fiscal year. 
Could you explain how the VA will do that? When I thought you 
mentioned prioritizing those veterans, I thought you also 
mentioned prioritizing those veterans living 40 miles from the 
VA facilities. Is that correct?
    Dr. Alaigh. Correct.
    Mr. Sablan. So those veterans who live 40 miles away from a 
facility will be prioritized or if they travel by sea or by 
air.
    Dr. Alaigh. Yeah. They will still be prioritized as part of 
the Choice Program, and then we still have Community Care funds 
for the other veterans.
    Mr. Sablan. Okay. Right.
    So, Mr. Yow, what is the FTE formula for determining the 
number of health care professionals needed in remote and 
underserved areas, particularly, again, areas like the Northern 
Mariana Islands?
    Mr. Yow. Yes, sir. I don't believe that VA currently has 
any sort of a standardized staffing methodology to determine 
that. It has been determined at a local level based on resource 
availability.
    I believe we are in the process of looking at several 
different types of models to use. One of which we are looking 
at is the DoD model for their fixed facility hospitals to see 
if we might be able to standardize staffing across the VA. But 
it has been very much a decentralized process.
    Mr. Sablan. But neither VA or DoD has a facility in the 
Northern Mariana Islands. So how do you use that model to--how 
do you use it to get information on the number of people you 
need?
    Mr. Yow. Yes, sir. It would be driven by the patient demand 
that you would have in that area and the scale of the size of 
the local facility. But like I say, we are very much in the 
beginning stages of that process.
    Mr. Sablan. And my next question is moot, I guess.
    Thank you very much. Thank you. I yield back my time.
    Mr. Rutherford. The gentleman yields back. Thank you, Mr. 
Sablan.
    I believe Chairman Roe has a follow-up question.
    Mr. Roe. I do, just very briefly. And thank you, Mr. 
Chairman for yielding.
    A follow-up from what Dr. Dunn was talking about just a 
minute ago. If Congress does not replenish the Choice Fund, 
will wait times lengthen like they were before Phoenix?
    Dr. Alaigh. Yes.
    Mr. Roe. Okay. That is one thing I wanted to know.
    Will veterans be able to seek appointments in the community 
like they have before if the Choice is not replenished?
    Dr. Alaigh. No.
    Mr. Roe. And will the TPAs have to let staff across the 
country go if it is not replenished?
    Dr. Alaigh. Yes.
    Mr. Roe. They will, okay.
    Those were the three things I would have liked to have 
placed on the record. And I yield back.
    Mr. Rutherford. Thank you, Mr. Chairman.
    I believe Mr. Takano has a follow-up as well. Oh, I am 
sorry, Ms. Brownley.
    Ms. Brownley. No, that is fine. Go ahead.
    Mr. Takano. So I just want to get clear about, Dr. Alaigh--
or is it Dr. Young is next door? Mr. Yow, okay. I just can't 
read the names. My eyes can't see. These are reading glasses. 
These are not binoculars.
    So let me get this straight. So you have 7,000 funded FTEs 
for personnel in VHA, but how many vacancies are there?
    Mr. Yow. I have heard the Secretary use numbers between 
35,000 and 45,000, but I think our personnel staff are trying 
to go back and verify those. We have a number that are open for 
any period of time for repeated vacancies for things like 
nurses and so forth. So I believe they are trying to go through 
right now and scrub that and come back with a better estimate.
    But like I say, typically we have about 10 percent of our 
total workforce that will turn over within a year, so that 
would be about 30,000 at any given time that we would be 
recruiting.
    Mr. Takano. So there is a 10 percent turnover, but there 
are also positions that are unfilled in addition, right?
    Mr. Yow. Yes, sir.
    Mr. Takano. So the total workforce represents a shortfall 
in what is needed, and so I am trying to get a sense of that.
    Mr. Fuentes, you mentioned earlier, I want you to kind of 
explain more what you meant about that you feel that the VA's 
budget was shorted or constrained by sequester. Can you 
elaborate just a little further on that?
    Mr. Fuentes. Yes. Thank you, Congressman.
    So sequestration occurred because, you know, this was a 
super committee that was created in 2010, so essentially 
reduced the budget over 10 years for a certain amount of--I 
forgot the exact billions amount of money. They failed, so then 
it was an arbitrary every year 10 percent cut of the budget.
    There were negotiations the past 4 years. In 2018 the 
fiscal--the budget for fiscal year 2018 reverts back to those 
budget caps that were set 7 years ago. So what really happens 
is when you have, you know, the overall cap, then you have to 
decide how you are going to split that money.
    And really, because of that, VA is impacted in how much 
they can request because OMB tells them you need this much 
money but this is only how much you can get. And then it also 
limits Congress' ability to fully fund what VA has requested 
because of the needs of other departments, other committees, 
and other programs.
    Mr. Takano. Well, thank you.
    And I just have one more--
    Mr. Roe. Would the gentleman yield?
    Mr. Takano [continued]. I do want to ask one more question, 
if I can just ask the last question. But I will yield.
    Mr. Roe. Just very briefly, just to put that in context. 
Like I said a moment ago, I was here for the BCA. We had a 
number in the discretionary part of the budget that we funded. 
We have taken money away from other departments and almost 
doubled, as a matter of fact over doubled the VA's budget, just 
for clarification. I yield back.
    Mr. Takano. Thank you, Mr. Chairman.
    If I could, I just want to ask a question on homelessness. 
It was mentioned before.
    In 2015, the Supportive Services for Veteran Families, SSVF 
programs, received a nationwide surge in funding. That surge 
consisted of about $300 million to 56 communities, including my 
own, over 3 years. Those funds dry up at the end of this fiscal 
year.
    In order to maintain the same levels of services and 
prevent the expiration of these surge grants, the SSVF program 
would need up to $80 million more in fiscal year 2018 than the 
Department requested.
    Now, many communities that receive that money say it is 
still necessary to end veterans' homelessness in their areas, 
and some communities have reached the goal of ending veterans' 
homelessness with that money, say that it is also necessary to 
rapidly rehouse newly homeless veterans in their areas. These 
areas will need funding for the SSVF program.
    Now, please explain why the Department's budget did not 
reflect the cost of maintaining these surge grants.
    Dr. Alaigh. I can tell you that homelessness is one of our 
most important priorities. We have made huge strides in 
fighting homelessness. We have a 4 percent increase in our 
homelessness budget for fiscal year 2018.
    And we will continue to make sure that we are working on 
appropriate case management programs, appropriate housing 
programs, and also the grant programs that all of your 
communities get in terms of the ability to fight it. About 50 
percent of our funding actually goes to those grant programs in 
each of your communities.
    Mr. Takano. I am going to take this to follow up for the 
record, in written, but as I understand it, HUD has cut from 
$60 million to $7 million funding for the HUD portion. I would 
like to be able to--if you--if the VA considered that as they 
are making their requests. But I will take that for the record 
later.
    Dr. Alaigh. Thank you.
    Mr. Rutherford. Thank you. The gentleman's time has 
expired.
    Ranking Member Ms. Brownley.
    Ms. Brownley. Thank you, Mr. Chairman.
    Since we have been talking so much about the vacancies 
within the VA, which is a very, very important topic, I just 
wanted to ask a question, because I know that we have had many 
hearings about HR services and the vacancies that needed to be 
if I would within HR.
    Can you tell me, within HR across the board in the VA, how 
many vacancies there are within Human Resources? These are the 
people that actually hire the people.
    Dr. Alaigh. Ranking Member, this is one of the weak links 
for us right now, and we don't have enough HR staff to support 
the hiring process. And we are looking at different ways of 
improving that hiring process.
    One of those programs that I know I was talking to Chairman 
Wenstrup about is the WARTAC program where servicemembers in 
the last 6 months before separation can be trained while they 
are still in their military facilities and be brought into the 
VA system.
    And so that is one of the things that we are going to be 
focusing on as we are trying to hire HR staff, scheduling 
staff, and logistics staff. Those are going to be our three 
focus areas.
    Ms. Brownley. Just it is hard for me to imagine that an HR 
staff--I mean, I can understand doctors. I can understand 
nurses. I can understand a lot of reasons and barriers for 
filling those pipelines and hiring those people. It is hard for 
me to understand that we can't fill positions in Human 
Resources. It is just hard for me to understand. And I would 
like to know a little bit more about that, and I would like to 
know with accuracy what are the vacancies within Human 
Resources.
    My colleague here is also saying that I know we had a 
hiring freeze. I don't know if that freeze is still on or off.
    Mr. Takano. Does it affect HR in particular?
    Ms. Brownley. There is a freeze on human resources?
    Dr. Alaigh. No, there is no freeze on any of the field 
positions at all. The field can hire, including HR, IT staff, 
and all the staff.
    Ms. Brownley. Okay. And then the last thing that I just 
wanted to get back to for a minute, which we talked a little 
bit about in my office yesterday, is Cerner and the electronic 
health records.
    So I was wondering if you could give the Committee a basic 
timeline. I think Mr. Rutherford is surprised that he is 
hearing that it is going to take kind of 2 years to gear up 
with the Cerner system to have compatibility with the DoD.
    And you have given all the reasons why that is. And I think 
I understand it a little bit more because we had deeper 
conversation in my office yesterday. But, you know, as I said 
to you in my office, I am like, I am surprised, because I was 
as surprised like you were. But if you could provide us--or if 
you could tell us right now, which would be great--what you 
believe the timeline is.
    I know you said in the office it is going to take 6 or 8 
months to negotiate a contract, and then it is going to be kind 
of a 2-year period to get up and going, and that is the 
interoperability between the VA and the DoD. And then we have 
got to figure out--the Cerner system doesn't come with 
automatic interoperability with community partners.
    Dr. Alaigh. Right.
    Ms. Brownley. And so that all has to be figured out too.
    So I started to think yesterday, well, this is going to be 
a pretty extensive timeline before we actually get to the place 
that we all want to be. So do you have a specific timeline that 
you could share with us so that we can monitor it?
    Dr. Alaigh. Yeah, absolutely. And what we are committed to 
do is once we have developed the high-level implementation plan 
we will share it with you. You know, you have been, the 
Committee has been amazing when it comes to every step of the 
way, as we have developed new programs, including the new care 
programs.
    So we will be sharing this with you along the way, but, 
yes, 3 to 6 months for negotiation and executing on the 
contract and then preparing the field for it. And we are 
talking--this is what happens in EMR implementation at this 
scale. This is not different than the VA. The DoD is going 
through this, and this is one of the largest implementations 
ever for any health care system.
    And you want to do it right. It is patient safety. You 
don't want to lose data. You want to make sure all the users 
know exactly what to do and have all the key elements of care 
that are going to ensure that the patient is getting the best 
possible care.
    So this is not something that you just do with the turn of 
a switch. This is something that has to be done very carefully. 
And, again, as I said, it has to be a grassroots effort. It is 
not something that we just say this is what the product is and 
you just go ahead and implement it.
    But I can understand how you are feeling about this. It is 
going to be a multiyear, you know, 5- to 10-year project at 
this point.
    Ms. Brownley. Well, what I am interested in, and I hear it 
and I am understanding it much better, but what I would really 
like is a very specific timeline in terms of what the 
implementation looks like.
    Dr. Alaigh. Yeah, and we will share it with you. The 
Secretary is so committed to making sure that we are walking 
with you every step of the way. So we will be transparent.
    Ms. Brownley. Okay. And I understand that there is, you 
know, the VA would have to issue a solicitation to Cerner. I am 
not quite sure I fully understand what all of this means. But 
if you have to offer a solicitation in the negotiations of the 
contract, does that make sense to you at all?
    My understanding is a solicitation to support the fact that 
you are awarding the sole source contract. But I guess my 
question is, have you looked into that, and if you have, are 
you going to need any kind of legislation to move forward with 
that?
    Dr. Alaigh. My understanding is no, but if we do, we will 
get back to you on that.
    Ms. Brownley. Okay. Very good. Thank you.
    I yield back.
    Mr. Rutherford. The gentlelady yields back.
    Before we close, I would like to have a follow-up myself 
with Mr. Yow.
    I presume that hospitals run a lot like other facilities 
that require fixed-post positions. I want to go back to this 
vacancy situation a moment. Fixed-post positions often require 
overtime. Do you have an overtime budget at VA?
    Mr. Yow. We will have to get that for you. I don't have 
that with me, but we do track it.
    Mr. Rutherford. Okay. And if you could at the same time, 
what I would like to know is, number one, what is the overtime 
budget; and number two, how much of that budget overtime is 
directly related to the vacancies that you are being forced to 
carry? Can you get that for me as well?
    Mr. Yow. I am not as confident in the second half of your 
question, to be able to differentiate the vacancies versus the 
overtime compared to anything else, but we will give it our 
best effort.
    Mr. Rutherford. Okay.
    Dr. Alaigh, you don't track it that way?
    Dr. Alaigh. Like I said, we are going to go back and look 
into it.
    Mr. Rutherford. Okay. All right. Thank you very much.
    I thank all of you once again. I really appreciate your 
testimony here today. If there are no further questions, the 
panel is now excused.
    I ask unanimous consent that all Members have 5 legislative 
days to revise and extend their remarks and include 
extemporaneous material. Without objection, so ordered.
    This hearing is now adjourned.

    [Whereupon, at 3:50 p.m., the Subcommittee was adjourned.]


                            A P P E N D I X

                              ----------                              

                     Prepared Statement of Joy Ilem
    Chairman Wenstrup, Ranking Member Brownley and Members of the 
Subcommittee:

    On behalf of DAV (Disabled American Veterans) and as one of the co-
authors of the Independent Budget, along with Paralyzed Veterans of 
America and Veterans of Foreign Wars of the United States, I am pleased 
to present our views on the resource needs of the Department of 
Veterans Affairs (VA) Veterans Health Administration (VHA) for fiscal 
year (FY) 2018 and advance appropriations for FY 2019. I associate my 
remarks with the statements and recommendations provided by our 
Independent Budget partners for VHA medical care accounts, construction 
accounts and the National Cemetery Administration. I will concentrate 
my remarks on the budgetary needs of a few of VA's most critical 
programs for ill and injured veterans-mental health care, suicide 
prevention, homelessness, women veterans and caregivers.
    While we appreciate the increases recommended in the President's 
budget for veterans health care in FY 2018, we are concerned the budget 
will not meet increasing demand for care and allow VA to meet its goals 
of providing timely, high quality care to veterans both in VA and the 
community. We applaud Secretary Shulkin for his leadership and efforts 
over the past few years to improve veterans' access to care and 
timeliness of services with a focus on creating a strong management 
team, increasing operational efficiency, streamlining and replacing 
outdated business processes, modernizing the veterans benefits system, 
health infrastructure and information technology (IT) system to include 
a new scheduling package and electronic health records system. The 
Secretary has also set a number of priorities to include: greater 
choice for veterans; building a high performing network of care to 
enhance VA services while optimizing community care options, expanding 
mental health services to veterans in crisis with less than honorable 
discharges, and an increased focus on suicide prevention efforts to 
eliminate veteran suicide. While we welcome increased funding to 
improve care and services for ill and injured veterans we want there to 
be an honest assessment and discussion about what the real costs are 
for accomplishing all of these important goals.
    DAV, along with our Independent Budget partners note two proposals 
contained in the Administration's budget that we strongly oppose. One, 
a provision that would scale back VA's Individual Employability (IU) 
benefit for thousands of veterans that are unable to maintain gainful 
employment as a result of their service-connected disability. 
Specifically, this proposal would terminate existing IU ratings for 
veterans, along with associated ancillary benefits, when they reach the 
minimum retirement age for Social Security purposes, currently 62, as 
well as cut off IU benefits for any veteran already in receipt of 
Social Security retirement benefits. This proposal is simply an unjust 
penalty and would place an undue financial hardship on all service-
disabled veterans in receipt of IU and their families.
    The second proposal would round down cost-of-living adjustments 
(COLAs) for disability compensation, Dependency and Indemnity 
Compensation (DIC) and some other benefits for the next 10 years. 
Veterans and their survivors rely on their disability compensation for 
essential purchases such as food, transportation, rent and utilities. 
This provision would unfairly target disabled veterans, their 
dependents and survivors to save the government money and offset the 
cost of other federal programs. All totaled, VA estimates this proposed 
COLA round down would cost beneficiaries close to $2.7 billion over the 
next 10 years. We are pleased that the Secretary acknowledged the 
negative impact the IU proposal would have on service-disabled veterans 
and indicated he was interested in finding another funding source to 
pay for Choice. We ask the Subcommittee to reject these proposals and 
reconsider the resources necessary for VA to meet the needs of our 
nation's veterans.

                           Mental Health Care

    An independent study found that most of VA's mental health 
providers were working at peak capacity and despite VA's concerted 
effort to hire more mental health clinicians, shortages still exist at 
some locations. Without sufficient resources, the Independent Budget 
veterans service organizations (IBVSOs) are concerned that this could 
potentially affect veterans' access to timely and appropriate care, 
particularly for specialized mental health services.
    Demand for VA mental health care services has grown significantly 
as Vietnam veterans age and our more recent war fighters return from 
combat deployments (often multiple deployments) and leave military 
service. Experts estimate that about 20 percent of our newest 
generation of war veterans are affected by post-traumatic stress 
disorder (PTSD). Researchers note that veterans using VA care from 
Operations Iraqi Freedom, Enduring Freedom and New Dawn (OIF/OEF/OND) 
have a high burden of post-deployment mental health challenges (56 
percent have a mental health diagnosis). Subgroups within this 
population, such as service-connected women veterans, also have an even 
higher prevalence of mental health needs. While VA has made progress 
and focused its efforts on outreach, decreasing stigma and improving 
access to a wide variety of mental health services, there continue to 
be unmet needs. Many of our most vulnerable veterans have risk factors 
associated with or exacerbated by their military service that lead to 
family disintegration, legal issues, unemployment, homelessness and 
unfortunately, in some cases, suicide.
    Despite the challenges, research indicates that veterans who are 
engaged in VA care and treatment programs are less likely to take their 
lives. Likewise, veterans with serious mental illnesses using VA health 
care have longer life expectancies than other Americans with such 
conditions. Integration of mental health services into VA primary care 
settings and the development and use of evidence-based practices to 
treat disorders such as PTSD linked to combat and sexual trauma have 
proven effective. We are pleased that VA, as part of its suicide 
prevention efforts, is also beginning to use analytic predictive models 
(VA REACH VET initiative) to better identify at-risk veterans. While 
problems, including the timeliness of care and sufficient staffing 
levels remain at certain locations, we believe veterans with serious 
mental illness, PTSD (associated with combat or sexual trauma), or 
post-deployment mental health challenges are best served by VA's highly 
specialized and comprehensive mental health care model.
    VA's primary care teams with integrated behavioral health services 
routinely identify and refer veterans for advanced screening for such 
commonly diagnosed conditions as depression, anxiety, and substance use 
disorders. We commend VA for ensuring mental health is considered an 
important part of a veteran's overall health-but this new model of care 
has increased the need for mental health services among thousands of VA 
patients who have not previously used these services. VA will need to 
continue to attract, hire and train a sufficient number of mental 
health professionals, including family and marital counselors and 
community partners in some locations to meet rising demand and provide 
timely and individualized care. VA must also continue its efforts to 
help family members coach struggling veterans into care and keep them 
engaged in treatment. VA must also focus on meeting the diverse needs 
of its veteran population to include elderly veterans, Vietnam 
veterans, and women veterans.
    PTSD often co-occurs with other mental health issues including 
substance use disorders, depression, and traumatic brain injury. 
Veterans with ``dual diagnoses'' are often among the most difficult to 
treat and require intensive care and case-management. VA must continue 
to research more effective treatments to address these complex patients 
with comorbid conditions. Likewise, clinicians must have the ability to 
schedule and carry out more resource intensive, evidence-based 
treatments for veterans who need it. VA clinicians are beginning to 
understand the value of peer specialists as these professionals are 
often able to engage isolated veterans because of their shared military 
experience, and better assist veterans with patient education and 
navigating VA's complex health care system.
    VA must have sufficient resources to treat case-intensive veterans 
with serious mental illness, employ more peer specialists, properly 
staff the veterans crisis line, increase outreach and focus on shared 
prevention efforts, and develop programs that meet the unique needs of 
women veterans who are at high risk for homelessness and suicide.
    There must be continued oversight by the Subcommittee to ensure 
that VA has the resources necessary to provide timely and 
individualized mental health care to a diverse veteran population. 
Sufficient resources are necessary to meet increased demand for 
specialized mental health care services for PTSD, substance use 
disorder, serious mental illness or for veterans who have experienced 
military sexual trauma. VA must also have sufficient resources to 
properly staff the veterans crisis line, improve suicide prevention 
efforts and develop programs that meet the unique needs of women 
veterans who are at high risk for homelessness and suicide.
    We urge the Subcommittee to ensure VA mental health programs 
continue to receive adjustments commensurate with increased workloads 
and continue to monitor VA's ability to fully implement newly 
authorized services and programs, such as those contained in Public Law 
114-2, the Clay Hunt Suicide Prevention for American Veterans (SAV) 
Act.
    Another issue that will require the Subcommittee's oversight is the 
proposal to provide veterans with other than honorable discharges 
access to urgent health and mental health services. We commend 
Secretary Shulkin for taking steps to address the needs of this 
population (an estimated 500,000 veterans). We know that many of these 
individuals have PTSD, experienced military sexual trauma or have 
undiagnosed mental health issues or a mild traumatic brain injury that 
may have contributed to behavior that led to their less favorably 
characterized administrative discharges.
    While we acknowledge the Secretary's assertion that he does not 
require increased funding to address the potential increase in 
workload, we believe the impact on access to mental health care could 
be significant and may require hiring of additional providers as well 
as clinical and Vet Center space to accommodate increased demand. We 
recommend that VA identify the full estimated cost of implementing this 
decision and request that Congress provide additional funds if 
necessary. The IBVSOs believe these veterans need and should receive 
this critical care, especially veterans who may have sustained a brain 
injury during military service or suffering from a mental health 
condition that went undiagnosed or untreated.

                         Veterans' Homelessness

    Unemployment, homelessness and suicide are often the consequences 
of a failed mental health safety net. Since 2010, based on intensely 
focused resources and efforts, VA and its partner agencies have 
decreased the numbers of veterans who are homeless by nearly 50 
percent.
    In the FY 2018 budget plan, the Administration requested less 
funding for VA's psychiatric rehabilitation and homeless veteran 
domiciliary beds and a significant cut to funding for these beds in FY 
2019. These cuts will undermine veterans' recovery. It is unrealistic 
to expect veterans who are homeless or in unstable housing to achieve 
difficult treatment goals such as achieving sobriety (or even reducing 
dependency upon substances) or attending to basic hygiene, independent 
living and vocational skills in order to successfully reintegrate into 
their communities. Psychiatric rehabilitation and domiciliary beds were 
designed as a less intensive and more cost-effective alternative which 
still give veterans a stable environment from which to launch recovery. 
Many of the veterans using such programs also have significant medical 
and mental health issues to address after living on the street. Without 
access to stable, supervised lodging and adequate nutrition and rest, 
these vulnerable veterans' chances to recover from years of addiction 
and/or significant chronic mental illness including psychoses and 
severe PTSD are severely jeopardized.
    Unfortunately, the progress made through collaborations between VA, 
other federal agencies, states and community partners appear imperiled 
by the current budget proposal. Proposed cuts in programs will impact 
the ability for homeless veterans to receive comprehensive services. 
While these proposals are outside of the House Veterans' Affairs 
Committee's jurisdiction in agencies such as HUD, the Interagency 
Council on Homelessness, the Legal Services Corporation, the Small 
Business Administration and Medicaid-they will impact this population. 
VA has invested a significant amount of resources to reduce the number 
of homeless veterans and we are very concerned the potential cuts to 
these important programs could undermine VA's progress to end 
homelessness among this population. VA's ability to work with other 
federal, state, and local agencies is critical to providing a 
comprehensive set of services to veterans who are homeless-from 
rehabilitation to reintegration into society with a goal of good 
health, recovery from mental illness or addiction and long-term stable 
employment and housing.

                             Women Veterans

    The delivery of care for women veterans has been a special 
challenge for VHA. While the number of women serving in the military 
continues to grow as does the number of women coming to VA for care, 
women still comprise a relatively small portion (about 11 percent) of 
VA's patient population. For these reasons, it has often been difficult 
for VA, especially outside of urban population centers, to provide 
high-quality comprehensive services in-house to women. Today, women 
serving in combat theaters are exposed to serious injury or death like 
their male counterparts. This new reality requires a focus on meeting 
the unique needs of an increasing number of women veterans in a health 
care system historically devoted to the treatment of men.
    Learning how to care for wounded women veterans, half of whom are 
of childbearing age, and their particular health issues and transition 
and rehabilitation needs includes learning how to best meet their needs 
for prosthetic and assistive devices. The IBVSOs recognize and commend 
the VA's efforts to enhance the care of female veterans in regard to 
technology, research, training, repair, and replacement of prosthetic 
appliances through the establishment of a women's prosthetic working 
group. The working group's mission was to eliminate barriers to 
prosthetic care experienced by women veterans and change the culture 
and perception of women veterans through education and information 
dissemination.
    The IBVSOs recommend the Medical Services appropriation for FY 2018 
be supplemented with $110 million designated for women's health care 
programs. These funds would be used to help the VHA deal with the 
continuing growth in women veterans coming to VA for care, including 
coverage for gynecological, prenatal, and obstetrical care, other 
gender-specific services, and for expansion and repair of facilities to 
improve privacy and safety for women receiving care. VA must also be 
able to continue its important research on the health impacts of 
wartime service on women veterans to better address the high rates of 
homelessness, suicide and unique transition challenges among this 
population.
    Additional funds would also aid the Department in its efforts to 
transform the culture of the system to ensure women veterans are 
provided equal benefits and health care services, have access to 
comprehensive care in a safe, private and comfortable setting and are 
recognized for their service and made to feel welcome at VA. Funds are 
necessary to address identified gaps in current programs and services, 
particularly post-deployment readjustment services for women veterans.
    Like all veterans, women veterans deserve the opportunity to 
receive care in VA with access to its highly specialized transition and 
rehabilitation services, veteran-focused research and care and psycho-
social wrap-around supportive services. This is especially critical for 
service-connected women veterans, women veterans with wartime service 
and veterans who have experienced sexual trauma.

                           Caregiver Support

    A final issue we ask the Subcommittee to consider championing is 
fixing the inequity of the current law supporting seriously disabled 
veterans' caregivers. The IBVSOs have worked diligently for many years 
as a part of a larger coalition of veterans organizations that promoted 
the advent of family caregiver support services for severely injured 
and ill veterans. Congress enacted Public Law 111-163, the Caregivers 
and Veterans Omnibus Health Services Act of 2010. However, that law 
limited services and supports to family caregivers of veterans who were 
injured or became severely ill in military service only on or after 
September 11, 2001. That omission left thousands of veterans' families 
without the level of caregiver support and services they needed because 
those veterans' health challenges or war injuries occurred before that 
effective date.
    Legislation has been introduced in both Chambers that would address 
this inequity and improve the lives of tens of thousands of veteran 
families. Not only is it the right thing to do for seriously ill and 
injured veterans, it will save the federal government a significant 
amount of resources that otherwise would need to be spent to provide 
more costly institutional care solutions for these veterans. We ask 
that resources be included in the budget to resolve this issue.
    In closing, we ask the Subcommittee to consider, as the budget 
process moves forward, that this is very critical time for VA. The new 
Administration has pledged support for our nation's veterans and 
Secretary Shulkin has committed to carry out that promise by creating a 
system that is worthy of their service and sacrifices. As VA moves 
forward to rebuild trust with veterans, make needed reforms and carry 
out modernization plans to strengthen and improve the VA, for the 
benefit of those who served, it is critical it has the resources and 
support it needs to be successful.
    Mr. Chairman, thank you for the opportunity to share the 
Independent Budget recommendations at this hearing today. I am prepared 
to answer any questions you or other members of the Subcommittee may 
have.

                                 
                    Prepared Statement of Carl Blake
    Chairman Wenstrup, Ranking Member Brownley, and members of the 
Subcommittee, as one of the co-authors of The Independent Budget (IB), 
along with DAV and Veterans of Foreign Wars, Paralyzed Veterans of 
America (PVA) is pleased to present our views regarding the funding 
requirements for the delivery of health care for the Department of 
Veterans Affairs (VA) for FY 2018 and advance appropriations for FY 
2019. On the following page, we have included a side-by-side comparison 
of funding recommendations previously appropriated for FY 2017 
recommended by the Administration by the IB for FY 2018, as well as the 
advance appropriations for FY 2019.

[GRAPHIC NOT AVAILABLE IN TIFF FORMAT]

    **Choice Program funding for FY 2018 includes the expected 
carryover of $600 million from the previous fiscal year as well as $2.9 
billion in new funding for the program. All Choice program funding is 
currently scored as a mandatory cost for VA.

    The IB's recommendations include funding for all discretionary 
programs for FY 2018 as well as advance appropriations recommendations 
for medical care accounts for FY 2019. The full budget report, released 
by The Independent Budget in March, addressing all aspects of 
discretionary funding for the VA can be downloaded at 
www.independentbudget.org. The FY 2018 projections are particularly 
important because previous VA Secretary Robert McDonald admitted last 
year that the VA's FY 2018 advance appropriation request was not truly 
sufficient and would need significant additional resources provided 
this year. We hope that Congress will take this defined shortfall very 
seriously and appropriately address this need. Our own FY 2018 
estimates affirm this need.
    We appreciate the fact that the Administration's recently released 
budget request for FY 2018 includes some increases in discretionary 
dollars for the Medical Care accounts above what had been previously 
provided through advance appropriations. Before addressing our specific 
budget recommendations, it is important for us to address the notion 
that VA does not need any additional resources, based on the expansive 
growth of overall VA expenses in the last 10 years. These ideas are not 
grounded in thorough analysis of demand and utilization of VA health 
care. Perhaps Congress can explain how the VA can take on significantly 
more demand for services both inside VA and in the community, and yet 
meet that demand and utilization with less resources-an assertion 
peddled by some organizations. While VA has seen substantial growth in 
its funding needs over the last decade, much of that is reflected in 
mandatory benefits to include the implementation of the Post-9/11 GI 
Bill. The fact is demand for health care services and actual 
utilization continue to rise at a significant rate. It may be possible 
to wring some efficiency savings out of VA to free up additional 
resources to address growing demand, but history has proven that 
process will not be sufficient to provide all of the resources VA needs 
to deliver on its promise to the men and women seeking health care and 
benefits.
    We also believe it is necessary to consider the projected 
expenditures under the Choice program authority that the previous 
Administration planned in FY 2017 and how that impacts the baseline 
that will dictate the funding needs for FY 2018. The previous 
Administration assumed as much as $5.7 billion in spending through the 
Choice program in FY 2017, on top of the Medical Services discretionary 
funding and the newly created Medical Community Care account. That 
amount was revised to approximately $2.9 billion. This means that the 
VA projected to spend more than $59.0 billion in Medical Services and 
more than $71.0 billion in overall Medical Care funding in FY 2017. 
These considerations inform the decisions of The Independent Budget to 
establish our baseline for our funding recommendations for both FY 2018 
and FY 2019.
    Earlier this year, the Administration also indicated that it 
intends to request as much as $3.5 billion in additional funding for 
the Choice program to keep it operating at least through the end of FY 
2018. That amount has since been revised to $2.9 billion for FY 2018 
(actually $3.5 billion when considering the already available $600 
million left over from the original authorization), as well as $3.5 
billion for FY 2019 and beyond. However, this recommendation begs the 
question: does this recommendation suggest that the Choice program as 
currently designed should continue in perpetuity? Certainly no 
reasonable person supports that idea. We believe that Congress must 
reject continued funding of this program through a mandatory account 
and place it in line with all other community care funded through the 
discretionary Community Care account established previously. This will 
eliminate competing sources of funding for delivery of health care 
services in the community, while maintaining visibility on spending 
through the Choice program.
    Moreover, we strongly oppose the decision to curtail Individual 
Unemployability (IU) benefits for veterans with significant service-
connected disabilities simply as a means to fund the continuation of 
the Choice program. It is beyond comprehension that the Administration 
would propose such a benefit reduction in order to pay for a flawed 
funding mechanism for a program (Choice) that sometimes provides health 
care access to non-service connected disabled veterans. Does this 
Committee really believe that veterans with disabilities rated between 
60 percent and 90 percent should be the source of funding for the 
Choice program? Eliminating IU benefits for veterans over the age of 62 
provokes numerous questions for us. Will veterans who have statutorily 
protected evaluations (the 20-year rule) also be subject to reduction? 
Will those dependents using Chapter 35 education benefits based on 
their sponsor's IU rating be forced to drop out of school? Will those 
veterans on IU who are covered by Service-Disabled Life Insurance at no 
premium be forced to now pay premiums in order to keep coverage? What 
about state benefits, such as property tax exemptions or state 
education benefits that are based on 100 percent VA disability ratings? 
How will this proposal affect efforts to combat veteran suicide and 
homelessness? We hope that you will reject this proposal in the 
strongest terms.
    For FY 2018, the IB recommends approximately $77.0 billion in total 
medical care funding. Congress previously approved only $70.0 billion 
in total medical care funding for FY 2018 (which includes an assumption 
of approximately $3.6 billion in medical care collections). The 
Administration's budget request includes a not-insignificant overall 
medical care funding recommendation of approximately $75.2 billion. 
However, we remain concerned that this level of funding will not keep 
pace with the continually increasing demand and utilization. The IB's 
recommendation also considers the approximately $1 billion VA is 
expected to have remaining in the Veterans Choice Fund and expected 
demand for care, including community care, that will not diminish or go 
away if the Choice Program expires. The Independent Budget recommends 
approximately $82.8 billion in advance appropriations for total Medical 
Care for FY 2019.

Medical Services

    For FY 2018, The Independent Budget recommends $64.5 billion for 
Medical Services. This recommendation includes:

 
 
 
 
            Current Services Estimate                 $60,897,313,000
         Increase in Patient Workload                  $1,595,242,000
     Additional Medical Care Program Cost              $2,001,000,000
       Total FY 2018 Medical Services                 $64,493,555,000
 


    The current services estimate reflects the impact of projected 
uncontrollable inflation on the cost to provide services to veterans 
currently using the system. This estimate also assumes a 1.5 percent 
increase for pay and benefits across the board for all VA employees in 
FY 2018. It was previously reported that the new Administration would 
like to consider a 1.9 percent federal pay raise.
    Our estimate of growth in patient workload is based on a projected 
increase of approximately 90,000 new unique patients. These patients 
include priority group 1*-8 veterans and covered non-veterans. We 
estimate the cost of these new unique patients to be approximately $1.4 
billion. The increase in patient workload also includes a projected 
increase of 58,000 new Operation Enduring Freedom and Operation Iraqi 
Freedom (OEF/OIF) enrollees, as well as Operation New Dawn (OND) 
veterans at a cost of approximately $242 million. The increase in 
utilization among OEF/OIF/OND veterans is supported by the average 
annual increase in new users through the third quarter of FY 2016.
    Additionally, The Independent Budget believes that there are 
medical program funding needs for VA that must be considered. Those 
costs total approximately $2.0 billion.

Long-Term Services and Supports

    The Independent Budget recommends $535 million for FY 2018. This 
recommendation reflects the fact that there was a significant increase 
in the number of veterans receiving Long Term Services and Supports 
(LTSS) in 2016. Unfortunately, due to loss of authorities-specifically 
fee-care no longer being authorized, provider agreement authority not 
yet enacted, and the inability to use Choice funds for all but skilled 
nursing care-to purchase appropriate LTSS care particularly for home 
and community-based care, we estimate an increase in the number of 
veterans using the more costly long-stay and short-stay nursing home 
care.

Prosthetics and Sensory Aids

    In order to meet the increase in demand for prosthetics, the IB 
recommends an additional $320 million. This increase in prosthetics 
funding reflects a similar increase in expenditures from FY 2016 to FY 
2017 and the expected continued growth in expenditures for FY 2018.

Women Veterans

    The Medical Services appropriation should be supplemented with $110 
million designated for women's health care programs in FY 2018. These 
funds will be used to help the VA deal with the continuing growth in 
women veterans coming to VA for care, including coverage for 
gynecological, prenatal, and obstetric care, other gender-specific 
services, and for expansion and repair of facilities hosting women's 
care to improve privacy and safety of these facilities. The new funds 
would also aid VHA in making its cultural transformation to ensure 
women veterans are made to feel welcome at VA, and provide means for VA 
to improve specialized services for preventing suicide and homelessness 
and improvements for mental health and readjustment services for women 
veterans.

Reproductive Services (to Include IVF)

    Last year, Congress authorized appropriations for the remainder of 
FY 2017 and FY 2018 to provide reproductive services, to include in 
vitro fertilization (IVF), to service-connected catastrophically 
disabled veterans whose injuries preclude their ability to conceive 
children. The VA projects that this service will impact less than 500 
veterans and their spouses in FY 2018. The VA also anticipates an 
expenditure of no more than $20 million during that period. However, 
these services are not directly funded; therefore, the IB recommends 
approximately $20 million to cover the cost of reproductive services in 
FY 2018. We are pleased to see that the Administration does retain the 
authority to provide reproductive services in its budget proposal.

Emergency Care

    Recently, the VA has received serious scrutiny for its 
interpretation of legislation dating back to 2009, which required it to 
pay for veterans who sought emergency care outside of the VA health 
care system. The Richard W. Staab v. Robert A. McDonald ruling handed 
down by the US Court of Appeals for Veterans Claims last year, places 
the financial responsibility of these emergency care claims squarely on 
the VA. Although VA continues to appeal this decision, it is not 
expected to prevail in this case leaving itself with a more than $10 
billion dollar obligation over the next 10 years. The Staab ruling is 
estimated to cost VA approximately $1.0 billion in FY 2018 and about 
$1.1 billion in FY 2019, which the IB has included in our 
recommendations.
    We are disappointed to see that the Administration's proposal 
continues to ignore its growing obligation to cover the cost of 
emergency care as dictated by the Staab decision. In fact, the 
Secretary suggested during a recent testimony before the Senate 
Committee on Veterans' Affairs that unfortunately the VA will have to 
take the money away from other places in its budget to pay these 
obligations. This is wholly unacceptable. Veterans should not have 
their benefits and services curtailed to pay for an utter failure of VA 
to accept this requirement. The VA should have requested the necessary 
funds in its Budget Request for FY 2018 to address this need. As it did 
not, it is incumbent upon Congress to provide the additional necessary 
resources. If Congress, fails to do so, it and the VA will both bear 
the blame for the negative impact that will be experienced in other 
areas of the VA.

FY 2019 Medical Services Advance Appropriations

    The Independent Budget once again offers baseline projections for 
funding through advance appropriations for the Medical Care accounts 
for FY 2019. While the enactment of advance appropriations for VA 
medical care in 2009 helped to improve the predictability of funding 
requested by the Administration and approved by Congress, we have 
become increasingly concerned that sufficient corrections have not been 
made in recent years to adjust for new, unexpected demand for care. As 
indicated previously, we have serious concerns that the previous 
Administration significantly underestimated its FY 2018 advance 
appropriations request. This trend cannot be allowed to continue, 
particularly as Congress continues to look for ways to reduce 
discretionary spending, even when those reductions cannot be justified.
    For FY 2019, The Independent Budget recommends approximately $69.5 
billion for Medical Services. Our Medical Services advance 
appropriations recommendation includes:


 
 
 
 
            Current Services Estimate                 $66,334,946,000
         Increase in Patient Workload                  $1,589,892,000
     Additional Medical Care Program Cost              $1,526,000,000
       Total FY 2019 Medical Services                 $69,450,838,000
 


    Our estimate of growth in patient workload is based on a projected 
increase of approximately 78,000 new patients. These new unique 
patients include priority group 1*-8 veterans and covered nonveterans. 
We estimate the cost of these new patients to be approximately $1.3 
billion. This recommendation also reflects an assumption that more 
veterans will be accessing the system as VA expands its capacity and 
services and we believe that reliance rates will increase as veterans 
examine their health care options as a part of the Choice program. The 
increase in patient workload also assumes a projected increase of 
62,500 new OEF/OIF and OND veterans, at a cost of approximately $272 
million.
    As previously discussed, the IBVSOs believe that there are 
additional medical program funding needs for VA. In order to meet the 
increase in demand for prosthetics, the IB recommends an additional 
$330 million. We believe that VA should invest a minimum of $120 
million as an advance appropriation in FY 2019 to expand and improve 
access to women veterans' health care programs. Our additional program 
cost recommendation includes continued investment of $20 million to 
support extension of the authority to provide reproductive services to 
the most catastrophically disabled veterans. Finally, VA's cost burden 
for paying emergency care claims dictated by the Staab ruling will 
require at least $1.1 billion in FY 2019 alone.

Medical Support and Compliance

    For Medical Support and Compliance, The Independent Budget 
recommends $6.7 billion for FY 2018. Our projected increase reflects 
growth in current services based on the impact of inflation on the FY 
2017 appropriated level. Additionally, for FY 2019 The Independent 
Budget recommends $6.8 billion for Medical Support and Compliance. We 
have concerns about the significant growth in these administrative 
account functions recommended by the Administration (nearly $300 
million in FY 2018 and an additional $300 million in FY 2019) as these 
areas have been shown to be bloated on numerous occasions in the past. 
These dollars could certainly be better spent providing direct care 
services to veterans.

Medical Facilities

    For Medical Facilities, The Independent Budget recommends $5.8 
billion for FY 2018. Our Medical Facilities recommendation includes 
$1.35 billion for Non-Recurring Maintenance (NRM). Likewise, The 
Independent Budget recommends approximately $6.6 billion for Medical 
Facilities for FY 2019. Our FY 2019 advance appropriation 
recommendation also includes $1.35 billion for NRM. We are pleased to 
see the Administration recommending real funding for this account in FY 
2018 (approximately $6.5 billion), but we are concerned that the Budget 
Request reflects the continued trend of reducing the recommendation in 
the advance appropriation year ($5.9 billion in FY 2019) in order to 
seemingly hold down discretionary projections.

Medical and Prosthetic Research

    We are very disappointed to see the major cut in funding for the 
Medical and Prosthetic Research program in the Administration's Budget 
Request-from $675 million in FY 2017 to $640 million in FY 2018. 
Despite documented success of VA investigators across many fields, the 
amount of appropriated funding for VA research since FY 2010 has lagged 
far behind annual biomedical research inflation rates, resulting in a 
net loss over these years of nearly 10 percent of the program's overall 
purchasing power. The VA Medical and Prosthetic Research program is 
widely acknowledged as a success on many levels, and contributes 
directly to improved care for veterans and an elevated standard of care 
for all Americans. We recommend that Congress appropriate $713 million 
for Medical and Prosthetic Research for FY 2018. Additionally, under 
the President's Precision Medicine Initiative, the IBVSOs recommend $65 
million to enable VA to process one quarter of the MVP samples 
collected, for a total research appropriation of $778 million.
    Thank you for the opportunity to submit our views on the FY 2018 VA 
Budget Request. We would be happy to answer any questions the 
Subcommittee may have.

                                 
                  Prepared Statement of Carlos Fuentes
    Chairman Wenstrup, Ranking Member Brownley and members of the 
Subcommittee, on behalf of the men and women of the Veterans of Foreign 
Wars of the United States (VFW) and its Auxiliary, thank you for the 
opportunity to present the VFW's views on the Department of Veterans 
Affairs' budget request.
    The VFW is glad to see President Trump has proposed a six percent 
increase in VA's FY 2018 discretionary budget compared to FY 2017. 
However, we feel his proposal falls short of what VA needs to keep pace 
with demand for health care. The VFW thanks the administration for its 
commitment to community care, long-term care, mental health care, woman 
veterans and efforts to prevent and eliminate veteran homelessness.
    However, we are very concerned that the administration's request to 
make the Veterans Choice Program a permanent mandatory program could 
lead to a gradual erosion of the VA health care system. What is more 
concerning is that the administration has chosen to make permanent a 
flawed program by ending Individual Unemployability benefits for 
severely disabled veterans who are unable to work due to their service-
connected disabilities, and a round down of cost of living disability 
pay increases--a proposal which the VFW has opposed in the past and 
continues to strongly oppose.
    The continued failure of Congress to eliminate sequestration has 
forced the administration to propose cuts to veteran benefits and cap 
GI Bill expenditures in order to expand the Choice Program under 
mandatory spending, instead of including the program in its 
discretionary community care account. In testimony before the Senate 
and House Committees on Appropriations, Secretary of Veterans Affairs 
(VA) David J. Shulkin has indicated that VA would like all of its 
community care money to come from one account, instead of having two 
separate accounts for the same purpose and not having the flexibility 
to use both accounts in accordance with veterans' demand for community 
care. The VFW agrees with Secretary Shulkin and urges Congress to 
consolidate VA's community care programs and to fund such programs 
through VA's discretionary appropriations account.
    Sequestration and its draconian spending caps limit our nation's 
ability to provide service members, veterans, and their families the 
care and benefits they have earned and deserve. The VFW calls on the 
Subcommittee to join our campaign to finally end sequestration and do 
away with a federal budget process based on the arbitrary budget caps, 
which significantly limit the government's ability to carry out 
programs that experience spikes in demand, such as VA health care. To 
the VFW, sequestration is the most significant readiness and national 
security threat of the 21st century, and despite almost universal 
congressional opposition to such haphazard budgeting, Congress has 
failed to end it.

Caregivers

    The VFW has heard for many years that veterans who require the 
assistance of a caregiver to perform activities of daily living have 
been rejected from the VA Caregivers Program, have been downgraded in 
tier level or outright kicked out of the program. These issues have led 
to VA implementing a moratorium on involuntary revocations from the 
program until VA is able to analyze the thousands of recent revocations 
to determine if veterans are being erroneously removed from the 
program. The VFW commends Secretary Shulkin for halting revocations and 
improving processes to ensure the program is functioning properly and 
implemented consistently throughout the VA health care system.
    However the administration's budget request assumes a $236 million 
decrease in funding for the program due to a projected decrease in the 
number of caregivers receiving stipend payments in fiscal year 2018. 
Given recent developments and the continued demand for this important 
program, the VFW believes funding for this important program should be 
increased, not decreased.
    While the VFW certainly agrees that veterans who have recovered 
from injuries and illnesses should be put on a path to achieve 
independent living and no longer require the assistance of a caregiver, 
such decisions must be made when the veteran and the caregiver agree 
and not by VA employees who lack the proper training and medical 
expertise to make such decisions. When a decision is made to graduate a 
veteran from the caregiver program, VA must ensure veterans and their 
caregivers are given the training and resources, such as employment 
training and independent living counseling, to ensure veterans can 
properly transition from needing a caregiver to performing activities 
of daily living without the assistance of others.
    The VFW has also said for years that the arbitrary delimitation of 
eligibility for the VA Caregiver Program unjustly ignores the selfless 
sacrifice of those who care for our pre-9/11 ill and injured veterans. 
Family caregivers who choose to provide in-home care to veterans who 
were severely disabled in the line of duty truly epitomize the concept 
of selfless service. They choose to put their lives and careers on 
hold, often accepting great emotional and financial burdens. They do so 
recognizing that their loved ones benefit greatly by receiving care in 
their homes, as opposed to institutional settings.
    The VFW strongly believes that the contributions of family 
caregivers cannot be overstated, and that our nation owes them the 
support they need and deserve. The VFW sees no justifiable reason to 
exclude otherwise deserving veterans from program eligibility simply 
based on the era in which they served. Accordingly, we strongly urge 
the Subcommittee to swiftly consider and pass a bill to expand the VA 
Caregiver Program to veterans of all eras who need the assistance of a 
caregiver due to service-connected illnesses and injuries.

Major Construction

    For more than a decade, the Independent Budget Veterans Service 
Organizations (IBVSOs) have warned Congress and VA that perpetual 
underfunding has allowed VA's infrastructure to erode, while its 
capacity has swelled from 81 percent in 2004 to as high as 120 percent 
in 2010. We continue to believe that this need for space and chronic 
underfunding of medical services could lead VA to ration care.
    The IBVSOs are working with VA to reform its construction process 
so facilities can be delivered on time and on budget. Previous errors 
must be corrected to ensure the issues in Aurora, Colorado, never occur 
again. However, Congress and the administration must not ignore the 
growing capital infrastructure needs of the Department's health care 
system.
    When VA asked its Veteran Integrated Service Networks (VISN) to 
evaluate what they need to improve its facilities to meet the increased 
outpatient demand, VA determined that ``improving the condition of VA's 
facilities through major construction projects (96) accounted for the 
largest resource need. \1\'' Yet, the administration's major 
construction request for the Veterans Health Administration (VHA) is 36 
percent less than FY 2017 and 85 percent less than actual expenditures 
in FY 2016.
---------------------------------------------------------------------------
    \1\ Department of Veterans Affairs 2018 Budget and 2019 Advance 
Appropriations Requests, Volume IV: Construction, Long Range Capital 
Plan and Appendix. Long Range Capital Plan, page 8.3-8.
---------------------------------------------------------------------------
    When asked why VA is taking a strategic pause on major construction 
for VHA when its capital infrastructure continues to age and demand 
continues to increase, VA informed the IBVSOs that it simply did not 
receive the request that it needed for major construction because of 
sequestration budget caps. Congress must not allow VA's inability to 
invest in VHA's major construction to limit veterans' access to the 
health care they have earned and deserve by forcing veterans into VA's 
community care programs and eliminating the choice to receive care at 
VA medical facilities.
    Currently, VA has 12 VHA construction projects that are partially 
funded that need a clear path to completion. Several projects have been 
removed from the priority list as candidates for public private 
partnership (P3) projects using recently enacted authority to combine 
private and public resources to fund VA construction projects. While 
the VFW supported Public Law 114-294, Communities Helping Invest 
through Property and Improvements Needed for Veterans Act of 2016, we 
do not believe the private sector can abrogate the federal government's 
obligation to properly fund medical facility construction projects.
    At the top of VA's Integrated Priority List for 2018 are several 
seismic correction projects, which must be fixed urgently or VA will 
continue to risk the lives of its patients and employees in the case of 
an earthquake. These projects cannot take a strategic pause while 
Congress and VA decide how to manage capital infrastructure long-term. 
VA will need to invest more than $3.5 billion to complete all 12 
partially funded construction projects. What is more concerning to the 
VFW is that none of the nine VHA construction projects of the top 15 
projects in VA's Integrated Priority List for 2018 received funding in 
the administration's fiscal year 2018 request. This mean that VHA is 
not only drastically behind in funding for its existing projects, its 
urgently needed projects are also being ignored, which can 
significantly impact its ability to provide care to veterans.
    The IBVSOs recommend that Congress appropriate at least $1.5 
billion for major construction in FY 2018. This amount will fund either 
the ``next phase'' or fund ``through completion'' all existing 
projects, and begin advance planning and design development on six 
major construction projects that are the highest ranked on VA's 
priority list.

Minor Construction

    In FY 2017, Congress appropriated $372.1 million for minor 
construction projects. Currently, approximately 600 minor construction 
projects need funding to close all current and future year gaps within 
ten years. To complete all of these current and projected projects, VA 
will need to invest between $6.7 and $8.2 billion in minor construction 
over the next decade.
    In August 2014, the president signed the Veterans Access, Choice, 
and Accountability Act of 2014 (Public Law 113-146). In this law, 
Congress provided $5 billion to increase health care access by 
increasing medical staffing levels and investing in infrastructure. VA 
has developed a spending plan that obligated $511 million for 64 minor 
construction projects over a two-year period.
    While this infusion of funds has helped, there are still hundreds 
of minor construction projects that need funding for completion. It is 
important to remember that these funds are a supplement to, not a 
replacement of, annual appropriations for minor construction projects. 
The IBVSOs recommend that Congress fund VA's minor construction account 
at $700 million in an effort to close all identified gaps within ten 
years.

Leasing

    Historically, VA has submitted capital leasing requests that meet 
the growing and changing needs of veterans. VA has again requested an 
adequate amount--$270.1 million for its FY 2018 major medical leasing 
needs. While VA has requested adequate resources, Congress must find a 
way to authorize and appropriate leasing projects in a way that does 
not require Congress to pass a law to authorize individual leases. The 
VFW urges the Subcommittee to explore options similar to the process 
used by the House Committee on Transportation and Infrastructure to 
review and approve U.S. General Service Administration leases.
    There are now 27 major medical leases awaiting congressional 
authorization, 18 of which have been waiting since FY 2016 and six from 
FY 2017. Delays in authorization of these leases will have a direct 
impact on VA's ability to provide timely care to veterans in their 
communities.

Legislative Proposals

    As part of the budget, VA submitted a list of legislative proposals 
which have a budgetary impact. The VFW supports VA's proposals to amend 
pay caps for nurse executives; cover the cost of medical foster homes, 
so veterans can continue to live in the comfort of a home environment 
instead of being forced into institutional long-term care; convert 
perfusionists to title 38 employees; reimburse advance practice 
registered nurses for continuing professional education; make VA a 
participating provider by third party payers; and improve the hiring 
authorities for medical center and network directors.
    The VFW does not take a position on the proposal to require VA 
medical facilities to become smoke free campuses, but we urge the 
Subcommittee to consider an appropriate implementation timeline for the 
more than 120 VA community living centers which have onsite designated 
smoking areas. Veterans who live in such facilities must be given the 
opportunity to adjust to a smoke free environment, not forced to quit 
and adjust to a new way of live within 90 days.
    The VFW opposes the VA proposal to discontinue reducing the first 
party copayment obligations of veterans who have their copayments 
covered by their third-party health coverage. Under current law, VA is 
required to offset a veteran's VA copayment obligation with funds it 
collects from the veteran's third-party health care coverage. Doing so 
incentivizes veterans to report their third-party coverage to VA and 
ensure VA is able to offset the cost of providing non-service connected 
care. Discontinuing this practice would add cost burdens to veterans 
who, according to independent assessments, can least afford it. Such 
veterans could also choose to terminate their other health insurance--
reducing the amount of funds it is able to collect--or forgo receiving 
all their care at VA, which results in fragmented care that endangers 
patient safety.
    Mr. Chairman, this concludes my testimony. I will be happy to 
answer any questions you or the Subcommittee members may have.

                                 
                Prepared Statement of Matthew J. Shuman
    SHUMAN 8 footnotes
    Chairman Wenstrup, Ranking Member Brownley, and Members of the 
Subcommittee; On behalf of Charles E. Schmidt, the National Commander 
of the largest Veteran Service Organization in the United States of 
America representing more than 2.2 million members; we welcome this 
opportunity to comment on the federal budget and specific funding 
programs of the Department of Veterans Affairs (VA).

Choice

    The American Legion has reviewed the President's budget request and 
while we fully support the Administration's proposal to increase the 
discretionary budget of the Department of Veterans Affairs by $4.3 
billion, we would like to draw this committee's attention to several 
components of this request that The American Legion calls on Congress 
to address.
    One of the highlights of the President's budget request is a $2.9 
billion request to continue the Veterans Choice Program. The American 
Legion remains steadfast in our position that a consolidated community 
care program replace the disparate contracting and procurement vehicles 
that have amassed over the years at VHA to supplement care for veterans 
when medically necessary care is not available organically at VA.
    In August 2014, President Obama signed into law the Veterans 
Access, Choice, and Accountability Act (VACAA). Included in that 
legislation was the Veterans Choice Program or the VCP. The Veterans 
Choice Program expands the availability of medical services for 
eligible veterans with community providers and was intended to be a 
temporary, emergency program in response to the revelation that VA 
medical centers were unable to serve the veterans in catchment areas 
who were requesting care, and subsequently created off-the-books wait 
lists to try and keep track of veterans who needed care but could not 
get an appointment in a timely manner.
    The American Legion supported this program as an emergency, 
temporary measure and insisted on a sunset date, as did the House 
Committee of Veterans Affairs and other major veteran service 
organizations. Through increased emphasis on eradicating all hidden 
wait lists and ensuring that all veterans asking VA for medical 
appointments were seen in 30 days or less, VA quickly exhausted their 
community care accounts while Choice funding remained largely 
untouched. Because of the funding mechanism used to support the Choice 
program VA was unable to adjust funding between their traditional 
contracting accounts, creating an unbalanced community care program 
that required former VA Secretary Bob McDonald to mandate that all 
appointment requests be pushed into the Choice program because that was 
the only way VA was able to spend down the appropriated funds. This 
caused an artificial dependence on the Choice program while preserving 
resources in VA's more established community care program accounts.
    The American Legion calls on the President and this Congress to 
rededicate the funding proposed in the 2018 Presidential budget request 
toward supporting VA's medical infrastructure and existing community 
care programs, and allow Choice to terminate as originally planned.

Mental Health

    According to RAND \1\ about one-third of returning servicemembers 
report symptoms of mental health or cognitive condition which served in 
either Iraq or Afghanistan and suffer from either major depression or 
post-traumatic stress disorder. This has increased the demand for 
mental health services at VA. Unfortunately, there is a national 
shortage of mental healthcare providers, and the shortage is projected 
to grow acute over the next decade. According to a recent analysis by 
the U.S. Health Resources & Services Administration, the nation needs 
to add 10,000 providers to each of seven separate mental healthcare 
professions by 2025 to meet the expected growth in demand. \2\ The 
widening gap between demand and the supply of available behavioral 
healthcare providers is being driven by a greater emphasis on 
addressing mental health issues within primary care settings. Yet the 
average wait time at VA is about four days for routine appointments and 
urgent care remains same day \3\ despite staffing shortages \4\. The 
American Legion calls on the President and this Congress to increase 
funding at VA to eradicate staffing shortages and support American 
veterans with the superior services they have earned at their VA 
medical facilities.
---------------------------------------------------------------------------
    \1\ http://www.rand.org/pubs/research--briefs/RB9336.html
    \2\ http://www.modernhealthcare.com/article/20161231/
TRANSFORMATION03/161229942
    \3\ https://www.va.gov/HEALTH/docs/DR71--062017--Pending--and--
EWL--Biweekly--Desired--Date--Division.pdf
    \4\ https://www.legion.org/legislative/236723/legion-testifies-
dangers-va-staff-shortages

---------------------------------------------------------------------------
Caregivers

    The struggle to care for veterans wounded in defense of this nation 
takes a terrible toll on families. In recognition of this, Congress 
passed, and President Barack Obama signed into law, the Caregivers and 
Veterans Omnibus Health Services Act of 2010. The unprecedented package 
of caregiver benefits authorized by this landmark legislation includes 
training to help to ensure patient safety, cash stipends to partially 
compensate for caregiver time and effort, caregiver health coverage if 
they have none, and guaranteed periods of respite to protect against 
burnout.
    The comprehensive package, however, is not available to most family 
members who are primary caregivers to severely ill and injured 
veterans. Congress opened the program only to caregivers of veterans 
severely ``injured,'' either physically or mentally, in the line of 
duty on or after Sept. 11, 2001. It is not open to families of severely 
disabled veterans injured before 9/11, nor is it open to post-9/11 
veterans who have severe service-connected illnesses, rather than 
injuries, which is why we call on Congress to immediately pass the 
Military and Veteran Caregiver Services Improvement Act of 2017.
    The American Legion has long advocated for expanding eligibility 
and ending the obvious inequity that Caregivers and Veterans Omnibus 
Health Services Act of 2010 created. Simply put, a veteran is a 
veteran! All veterans should receive the same level of benefits for 
equal service. As affirmed in American Legion Resolution No. 259: 
Extend Caregiver Benefits to Include Veterans Before September 11, 
2001, The American Legion supports legislation to remove the date 
September 11, 2001, from Public Law 111-163 and revise the law to 
include all veterans who otherwise meet the eligibility requirements. 
\5\
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    \5\ American Legion Resolution No. 259 (2016): Extend Caregiver 
Benefits to Include Veterans Before September 11, 2001
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    The American Legion is optimistic that providing expanded support 
services and stipends to caregivers of veterans to all eras is not only 
possible but also budgetary feasible and the right thing to do. We urge 
this committee and the U.S. Congress to allocate the required funding 
to expand the caregiver program to all eras of conflict and veterans 
who should be in this program.
    Though The American Legion is urging this Congress to expand the 
program, we are concerned that the FY18 budget reduces VA's caregiver 
program budget by over 200 million dollars. According to VA the 
``caregivers program cost estimate decreased by $235.9 million [which 
was] driven largely by a revision, based on actuals, in the projected 
number of Caregivers receiving stipend payments \6\.'' Based on the 
Secretary's recent reversal on program reviews being conducted in 
several regions across the United States, The American Legion is 
concerned that this diminished request is premature and fails to 
properly budget for all eligible program participants. The American 
Legion is working with several caregiver families who have been 
notified that they are in jeopardy of losing, or have already lost 
their caregiver stipends, and will continue working with individuals at 
VA, and in the caregiver program, to ensure that no one who is eligible 
to enter into or remain in the program are unjustly denied.
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    \6\ https://www.va.gov/budget/docs/summary/
fy2018VAsBudgetFastFacts.pdf

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Proposed Funding Offsets

    The President's budget proposes funding expanded VA needs by 
reducing existing VA funding needs in other areas. In general, The 
American Legion opposes cannibalizing existing benefits earned by some 
veterans to support benefits for other veterans. Further, the proposal 
to eliminate the individual unemployability benefit has got to be one 
of the worst proposals The American Legion has heard in years and 
adamantly opposes this request \7\.
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    \7\ https://www.legion.org/commander/237583/legion-slams-white-
house-va-budget
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    The administration's proposal would also round down to the nearest 
dollar the annual Cost-of-Living Adjustment (COLA) for service-
connected disability compensation, dependency and indemnity 
compensation, along with certain education programs. The American 
Legion opposes any reduction what so ever in the annual cost of living 
increases entitled to veterans \8\.
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    \8\ https://archive.legion.org/bitstream/handle/123456789/5504/
2016N164.pdf?sequence=1&isAllowed=y
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    The American Legion thanks this committee for the opportunity to 
elucidate the position of the over 2.2 million veteran members of this 
organization. For additional information regarding this testimony, 
please contact Mr. Matthew Shuman, Director of The American Legion 
Legislative Division at (202) 861-2700 or [email protected].

                                 
               Prepared Statement of Poonam Alaigh, M.D.
    Good afternoon Chairman Wenstrup, Ranking Member Brownley, 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 (FY) 2018 Budget and FY 2019 
Medical Care Advance Appropriations budget requests. I am accompanied 
today by Mark Yow, VHA Chief Finance Officer.
    The 2018 budget request fulfills the Administration's strong 
commitment to all of our Nation's Veterans by providing the resources 
necessary for improving the care and support our Veterans have earned 
through sacrifice and service to our country. The President's 2018 
budget requests $75.2 billion for VHA--$72.3 billion in discretionary 
funding (including medical care collections), of which $70 billion was 
previously provided as the 2018 AA for Medical Care. The discretionary 
request is an increase of $4.6 billion, or 6.7 percent, over 2017. It 
will improve patient access and timeliness of medical care services for 
over 9 million enrolled Veterans. The President's 2018 budget also 
requests additional mandatory funding to carry out the Veterans Choice 
Program (Choice Program).
    For the 2019 AA, the budget requests $74 billion in discretionary 
funding (including medical care collections) for Medical Care. The 
budget also requests $3.5 billion in mandatory budget authority in 2019 
for the Choice Program.
    The budget's request for mandatory funding to continue the Choice 
Program, or its successor, is fully offset by proposed reductions to 
certain Veterans' benefits programs.
    This budget request will ensure the Nation's Veterans receive high-
quality health care and timely access to services. I urge Congress to 
support and fully fund the Department's 2018 and 2019 AA budget 
requests - these resources are critical to enabling the Department to 
meet the increasing needs of our Veterans.
    Increasing our focus and efforts in order to improve how we execute 
our mission is critical. Veterans have unique needs, and the services 
VA provides to Veterans often cannot be found in the private sector. 
VHA provides support to Veterans through various services, including 
primary care, specialty care, peer support, crisis lines, 
transportation, the Caregivers program, homelessness services, 
vocational support, behavioral health integration, medication support, 
and a VA-wide electronic medical record system. These services and 
supports are unparalleled. With the continued support of Congress, VA 
will supplement its services through private-sector health care, but we 
realize it is not a replacement for the services VA provides to 
Veterans.
    We are already implementing bold changes in the agency. We are 
working hard to ensure employees are held accountable to the highest of 
standards. On May 31, 2017, Secretary Shulkin highlighted the 
activities and direction of the agency since his appointment in 
February 2017. My written statement will address those activities 
specific to VHA and how the FY 2018 budget request will assist in those 
efforts.

Access to Care and Quality of Care

    VA is taking multiple steps to expand capacity at our facilities by 
focusing on staffing, space, and productivity. The FY 2018 Budget 
request provides $72.3 billion in discretionary funding (including 
medical care collections). The request supports an increase in total 
outpatient visits - 114 million, compared to 110 million projected in 
2017; provides health care to over 7.0 million unique patients - up 
from 6.9 million in 2017; and expands medical facilities through 
leasing and improves current infrastructure through non-recurring 
maintenance.
    Veterans now have same-day services for primary care and mental 
health care at all VA medical centers across our system. I am also 
committed to ensuring that any Veteran who requires urgent care will 
receive timely care. We are also increasing transparency and empowering 
Veterans to make more informed decisions about their health care 
through our new Access and Quality Tool (available at 
www.accesstocare.va.gov). This Tool allows Veterans to access 
transparent and easy to understand wait-time and quality-care measures 
for VA health care, a tool that is unparalleled across the health care 
industry. That means Veterans can quickly and easily compare access and 
quality measures across VA facilities and make informed choices about 
where, when, and how they receive their health care. Further, they will 
now be able to compare the quality of VA medical centers to local 
private sector hospitals. This Tool will take complex data and make it 
transparent to Veterans. This new Tool will continue to improve as we 
receive feedback from Veterans, employees, Veterans Service 
Organizations (VSO), Congress, and the media.

Addressing Veteran Suicide

    Every suicide is tragic, and regardless of the numbers or rates, 
one Veteran suicide is too many. Suicide prevention is VA's highest 
clinical priority, and we continue to spread the word throughout VA 
that ``Suicide Prevention is Everyone's Business.'' The 2018 Budget 
requests $8.4 billion for Veterans' mental health services, an increase 
of 6 percent above the 2017 level. It also includes $186.1 million for 
suicide prevention outreach. VA recognizes that Veterans are at an 
increased risk for suicide and has implemented a national suicide 
prevention strategy to address this crisis. VA is bringing the best 
minds in the public and private sectors together to improve our effort 
and determine the next steps in implementing the Eliminating Veteran 
Suicide Initiative. VA's suicide prevention program is based on a 
public health approach and recognition that suicide prevention requires 
ready access to high quality mental health services, supplemented by 
programs that address the risk for suicide directly. Showing its 
commitment to suicide prevention as everyone's business, VA now 
requires SAVE Training (The acronym ``SAVE'' summarizes the steps 
needed to take an active and valuable role in suicide prevention: Signs 
of suicidal thinking, Ask questions, Validate the person's experience, 
and Encourage treatment and Expedite getting help) annually for all 
employees at VA medical centers, and we are rolling out the training 
for all VA employees to include Central Office, the Veterans Benefits 
Administration, and the National Cemetery Administration. Every 
employee will be able to recognize and respond to signs of crisis and 
know how to expedite getting the individual Veteran into care.
    As part of VA's commitment to put forth resources, services, and 
technology to reduce Veteran suicide, VA initiated the Recovery 
Engagement and Coordination for Health Veterans Enhanced Treatment 
(REACH VET). This new program was launched by VA in November 2016 and 
was fully implemented in February 2017. REACH VET uses a new predictive 
model in order to analyze existing data from Veterans' health records 
to identify those who are at a statistically elevated risk for suicide, 
hospitalization, illnesses, and other adverse outcomes. Not all 
Veterans who are identified have experienced suicidal ideation or 
behavior. However, REACH VET allows VA to provide support and pre-
emptive enhanced care in order to reduce the likelihood that the 
challenges these Veterans face will become a crisis.

Care in the Community

    We recognize that we must address how the Choice Program is 
accessed, and we are committed to streamlining and improving how 
Veterans can access and utilize it. We believe redesigning community 
care will result in a strong VA that can meet the special needs of our 
Veteran population. A redesigned community care program will not only 
improve access and provide greater convenience for Veterans, but will 
also transform how VA delivers care within our facilities. Where VA 
excels, we want to make sure that the tools exist to continue 
performing well in those areas. Veterans need VA, and for that reason, 
community care access must be guided by principles based on clinical 
need and quality.
    Since the start of the Choice Program, over 1.7 million Veterans 
have received care through the Program. In FY 2015, VA issued more than 
380,000 authorizations to Veterans through the Choice Program. In FY 
2016, VA issued more than 2,000,000 authorizations to Veterans to 
receive care through the Choice Program, more than a five-fold increase 
in the number of authorizations from 2015 to 2016.
    Looking at early data for 2017, it is expected that Veterans will 
benefit even more this year than last year from the Choice Program. In 
the first five months of FY 2017, we have seen a more than 36 percent 
increase from the same period in FY 2016 in terms of the number of 
Choice authorizations. In addition to increasing the number of Veterans 
accessing care through the Choice Program, VA is working to increase 
the number of community providers available through the Program. In 
April 2015, the Choice Program network included approximately 200,000 
providers and facilities. As of March 2017, the Choice Program network 
has grown to over 430,000 providers and facilities, a more than 150 
percent increase during this time period.
    As these numbers demonstrate, demand for community care is high. In 
2018, VA plans on a total of $13.2 billion to support community care 
for Veterans. Community care will be funded by a discretionary 
appropriation of $9.4 billion for the Medical Community Care account 
($254 million above the enacted advance appropriation) and $256 in 
estimated collections, plus $2.9 billion in new mandatory budget 
authority for the Choice Program. This, combined with a planned $626 
million in carryover balances in the Veterans Choice Fund, would have 
provided a total of $13.2 billion in 2018 for community care. However, 
as of June 9, 2017, $9.2 billion of the Choice Fund has been obligated 
and $7.1 billion has been expended. These levels represent a 
significant acceleration of funds being expended from the Veterans 
Choice Fund, and consequently, the Secretary has updated the estimates 
VA previously put forth regarding when Choice Program funds would be 
fully obligated.
    In March 2017, VA issued the highest number of authorizations in a 
month since the start of the program, followed closely by April and 
May. Over the three-month period between March and May 2017, VA issued 
nearly 800,000 authorizations for Choice Program care, a 32-percent 
increase over the same time period in 2016. As a result, VA anticipates 
that Choice Program funds will be fully obligated sooner than 
previously expected. Based on VA's latest risk-adjusted cost estimates 
and volume projections, the program will be unable to carry over the 
previously estimated $626 million, resulting in a need for the total 
$3.5 billion in new mandatory budget authority to continue the Choice 
Program in FY 2018. The 2018 budget proposes a funding mechanism to 
continue this program, or its successor, to ensure that we can maintain 
and improve upon the gains in Veterans' access to health care.
    VA will continue to partner with Congress to develop a community 
care program that addresses the challenges we face in achieving our 
common goal of providing the best health care and benefits we can for 
our Veterans. We have also worked with and received crucial input from 
Veterans, community providers, VSOs, and other stakeholders in the 
past, and we will continue doing so going forward

Electronic Health Record

    Having a Veteran's complete and accurate health record in a single 
common Electronic Health Record (EHR) system is critical to that care, 
and to improving patient safety. VA's current Veterans Information 
Systems and Technology Architecture (VistA) system is in need of major 
modernization to keep pace with the improvements in health information 
technology and cybersecurity, and software development is not a core 
competency of VA. On June 5, 2017, the Secretary announced that VA will 
start the process of adopting the same EHR system as the Department of 
Defense (DoD), now known as MHS GENESIS, which at its core consists of 
Cerner Millennium. VA's adoption of the same EHR system as DoD will 
ultimately result in all patient data residing in one common system and 
enable seamless care between the Departments without the manual and 
electronic exchange and reconciliation of data between two separate 
systems.
    Of course, VA has unique needs that are different from DoD's. For 
this reason, VA will not simply be adopting the identical EHR that DoD 
uses, but we intend to be on a similar Cerner platform. VA clinicians 
will be very involved in how this process moves forward and in the 
implementation of the system. Furthermore, VA must obtain 
interoperability not only with DoD but also with our academic 
affiliates and community partners, many of whom are on different 
information technology platforms.
    Therefore, we are embarking on creating something that has not been 
done before - that is an integrated product that, while utilizing the 
DoD platform, will require a meaningful integration with other vendors 
to create a system that serves Veterans in the best possible way. This 
is going to take the cooperation and involvement of many companies and 
thought leaders, and can serve as a model for the Federal government 
and all of healthcare.

Medical and Prosthetic Research

    As the nation's only health research program focused exclusively on 
the needs of Veterans, VA research continues to play a vital role in 
the care and rehabilitation of our men and women who have served in 
uniform. Building on more than 90 years of discovery and innovation, VA 
research has a proud track record of transforming VA health care by 
bringing new evidence-based treatments and technologies into everyday 
clinical care. Innovative VA studies in areas such as basic and 
clinical science, rehabilitation, research methodology, epidemiology, 
informatics, and implementation science improve health care for both 
Veterans and the general public.
    The 2018 Budget includes $640 million for development of innovative 
and cutting-edge medical research for Veterans, their families, and the 
Nation. One example includes continuing the Million Veteran Program 
(MVP), a groundbreaking genomic medicine program, in which VA seeks to 
collect genetic samples and general health information from one million 
Veterans. The goal of MVP is to discover how genomic variation 
influences the progression of disease and response to different 
treatments, thus identifying ways to improve treatments for individual 
patients. These insights will improve care for Veterans and all 
Americans.
    Chronic pain is prevalent among Veterans, and VA has experienced 
many of the problems of opiate misuse and addiction that have made this 
a major clinical and public-health problem in the U.S. As VA continues 
to reduce excessive reliance on opiate medication and responds to the 
requirements of the Comprehensive Addiction Recovery Act (CARA), VA 
will expand pain-management research in 2018 in two areas. VA is 
testing and implementing complementary and integrative approaches to 
treating chronic pain which builds on a successful State of the Art 
Conference in late 2016 on non-opioid therapies for chronic 
musculoskeletal pain. In a second, longer-term initiative, VA is 
working on other drug models and current drugs in the market to test 
their efficacy for treating pain. A study being developed under the 
Learning Healthcare Initiative is being launched that will evaluate the 
impact of implementing a new tool to identify Veterans at high risk of 
adverse effects from their opiate medication.

Ending Veterans Homelessness

    VA's homelessness research initiative develops strategies for 
identifying and engaging homeless Veterans. Researchers also work to 
ensure homeless Veterans receive proper housing, a full range of 
physical and mental health care, and other relevant services. They are 
using existing data to identify and engage Veterans who are currently 
homeless, and to develop strategies to identify and intervene on behalf 
of Veterans at risk for homelessness.
    In FY 2018, VA is investing $1.7 billion in programs to assist 
homeless Veterans and prevent at-risk Veterans from becoming homeless. 
Funding provided for specific programs that reduce and prevent Veteran 
homelessness include $543 million for Housing and Urban Development-
Veterans Affairs Supportive Housing (HUD-VASH) for case management and 
supportive services to support about 93,000 vouchers; $320 million for 
Supportive Services for Veteran Families (SSVF); and $257.5 million for 
Grant and Per Diem program, including program liaisons.

Conclusion

    VA is committed to providing the highest quality care, that our 
Veterans have earned and deserve. I appreciate the hard work and 
dedication of VA employees, our partners from Veterans 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 that Veterans receive the quality 
health care 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 
health care 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.

                                 
                       Statements For The Record

                    HEALTH NET FEDERAL SERVICES, LLC
                  Billy R. Maynard, President and CEO
    RE: Letter correcting 062317 Record from House Veterans' Affairs 
Subcommittee on Health during the hearing entitled, ``FY 2018 
Department of Veterans Affairs Budget Request for the Veterans Health 
Administration''

    Dear Chairman Wenstrup,

    I am writing with regard to the testimony provided by Dr. Poonam 
Alaigh, M.D., Acting Under Secretary of Health, Veterans Health 
Administration, Department of Veterans Affairs before the House 
Veterans Affairs Subcommittee on Health during the hearing entitled, 
``FY 2018 Department of Veterans Affairs Budget Request for the 
Veterans Health Administration'' held on June 23, 2017.
    During the hearing, in response to a question from Congressman 
Bilirakis regarding prompt payment of providers, Dr. Alaigh stated that 
``Our (VA's) payment to the TPAs (Third Party Administrators) is within 
thirty days. The TPAs then have to pay the provider.''
    This statement is factually incorrect. Under the Veterans Choice 
Program, the TPAs pay the provider claims first from their own funds 
then invoice the VA for reimbursement. The correct process is as 
follows:

      A veteran is referred to the Choice program by the VA.
      The veteran calls the Health Net Federal Services (HNFS) 
Veterans Choice Call Center to confirm eligibility.
      HNFS locates a VCP provider who can accept the veteran as 
a patient.
      HNFS schedules appointment on behalf of veteran and faxes 
the provider information about the appointment, including the 
authorization number, veteran contact details and additional details 
given to HNFS by VA.
      The provider treats the veteran and submits a claim 
(electronically or mailed) to HNFS.
      Separately, the provider faxes medical documentation to 
HNFS. HNFS receives and processes the claim and pays the provider.
      Only then does HNFS invoice the VA for reimbursement for 
the paid claim.
      On average, VA reimburses HNFS within thirty days of 
invoice.

    Working in this way, over the last 18 months, HNFS has reimbursed 
community providers supporting eligible veterans located throughout the 
states and VA regions we are responsible for more than $1.2 billion in 
paid claims - all of which has been paid by our company in advance of 
any reimbursement from VA. On average, our company has maintained a 
balance of not less than $125 million paid in advance on behalf of the 
US Government in support of Choice Program health care costs. At times, 
the balance of paid claims we have maintained has exceeded $250 million 
pending adjudication through the invoicing process of the VA.
    Fulfilling our responsibilities as a Veterans Choice Program (VCP) 
contractor has required HNFS, with the full support of our publicly-
traded parent, Centene Corporation, to make extraordinary capital 
commitments that are unique and effectively unprecedented for a 
government contractor. In fact, it is fair to say that not many 
companies, and certainly not many government-sector contractors, would 
even have the ways and means to make such advance payment commitments.
    I respectfully request that this letter be submitted for the record 
for the June 23, 2017 Health Subcommittee hearing. Thank you for this 
opportunity to set the record straight. Serving the health care needs 
of those who serve our great country has been the singular mission of 
our company for nearly 30 years. We are honored every day to have the 
opportunity to serve our nation's veterans as a partner with the VA in 
the Veterans Choice Program.

    Sincerely,
    Billy R. Maynard
    President and CEO
    Health Net Federal Services, LLC

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