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


U.S. DEPARTMENT OF VETERANS AFFAIRS BUDGET REQUEST FOR FISCAL YEAR 2019

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

                                HEARING

                               BEFORE THE

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

                     ONE HUNDRED FIFTEENTH CONGRESS

                             SECOND SESSION

                               __________

                      THURSDAY, FEBRUARY 15, 2018

                               __________

                           Serial No. 115-48

                               __________

       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

Pursuant to clause 2(e)(4) of Rule XI of the Rules of the House, public 
hearing records of the Committee on Veterans' Affairs are also 
published in electronic form. The printed hearing record remains the 
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of converting between various electronic formats may introduce 
unintentional errors or omissions. Such occurrences are inherent in the 
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                            C O N T E N T S

                              ----------                              

                      Thursday, February 15, 2018

                                                                   Page

U.S. Department Of Veterans Affairs Budget Request For Fiscal 
  Year 2019......................................................     1

                           OPENING STATEMENTS

Honorable David P. Roe, Chairman.................................     1
Honorable Timothy J. Walz, Ranking Member........................     3

                               WITNESSES

The Honorable David J. Shulkin, M.D., Secretary, U.S. Department 
  of Veterans Affairs............................................     5
    Prepared Statement...........................................    42

        Accompanied by:

    The Honorable Jon Rychalski, Assistant Secretary for 
        Management and Chief Financial Officer, U.S. Department 
        of Veterans Affairs

    Mark Yow, Chief Financial Officer, Veterans Health 
        Administration

    James Manker, Acting Principal Deputy Under Secretary for 
        Benefits, Veterans Benefits Administration

    Matthew Sullivan, Deputy Under Secretary for Financial and 
        Planning, National Cemetery Administration

    Richard Chandler, Deputy Assistant Secretary for Resource 
        Management, Office of Information and Technology, U.S. 
        Department of Veterans Affairs

                       
                       STATEMENTS FOR THE RECORD

THE INDEPENDENT BUDGET...........................................    50

                        QUESTIONS FOR THE RECORD

HVAC TO VA.......................................................    63
HVAC TO OIG......................................................    92

 
U.S. DEPARTMENT OF VETERANS AFFAIRS BUDGET REQUEST FOR FISCAL YEAR 2019

                              ----------                              


                      Thursday, February 15, 2018

            Committee on Veterans' Affairs,
                    U. S. House of Representatives,
                                                   Washington, D.C.
    The Committee met, pursuant to notice, at 8:00 a.m., in 
Room 334, Cannon House Office Building, Hon. David Roe 
[Chairman of the Committee] presiding.
    Present: Representatives Roe, Coffman, Wenstrup, Radewagen, 
Bost, Walz, Takano, Brownley, Kuster, O'Rourke, Poliquin, 
Arrington, Rutherford, Higgins, Bergman, Banks, Gonzalez-Colon, 
Sablan, Esty, and Peters.

          OPENING STATEMENT OF DAVID P. ROE, CHAIRMAN

    The Chairman. The Committee will come to order. Good 
morning and thank you all for being here to discuss the 
President's fiscal year 2019 budget submission for the 
Department of Veterans Affairs. This fiscal year's budget 
request totals $198.6 billion in VA funding, an increase of 
nearly $12 billion over last year. That is a huge number, and 
it is even more striking when you compare the growth in VA's 
budget to the overall Federal spending and the economy.
    There is a graph in the VA budget presentation that 
illustrates this point. Since 2006, the VA budget is up 175 
percent, while overall Federal spending increased by 54 
percent, and GDP grew only 40 percent. Given the aggressive 
expansion of VA resources, I appreciate the Secretary's 
testimony emphasizing the Department's core objectives and 
specific foundational services that support those objectives. 
The Department must stay focused on their core mission to 
ensure resources are appropriately utilized and Veterans' care 
and benefits prioritized.
    VA will take action on many important items in fiscal year 
2019, some examples include implementation of the Forever GI 
Bill, an appeals modernization, and the start of what will 
undoubtedly be a costly and lengthy replacement of VA's 
electronic health record, just to name a few. Because we cannot 
possible cover all these important issues at length in today's 
hearing, in the coming weeks our Subcommittees will hold 
hearings on specific aspects of the budget proposal within 
their jurisdictions.
    Today we will discuss VA's proposed budget to help ensure 
the Department provides better quality and more timely services 
to our Nation's Veterans. One priority we share with Secretary 
Shulkin, VSOs, and our Senate counterparts is consolidating and 
improving VA community care.
    This Committee has heard from Veterans, VA employees, and 
industry leaders about the many obstacles that prevent VA from 
effectively partnering with community providers to augment in-
house health care services. Consolidating community care into 
one cohesive program that truly serves Veterans is a key 
investment for the future that will make every dollar spent go 
further.
    Another important priority is the establishment of a VA 
asset and infrastructure review process to help the Department 
repurpose or dispose of underutilized buildings, allowing 
dollars to be spent where they make the most impact. As we have 
discussed many times, modernizing VA's physical infrastructure 
is a crucial prerequisite to ensuring the future success of the 
VA care system.
    I was pleased to see President Trump's infrastructure plan 
specifically mention VA assets. VA is one of the Federal 
governments largest property holding entities. However, the 
Department's capital asset portfolio is challenging. The 
average VHA building is approaching 60 years old--and I know 
something about that number--and was designed to meet an older 
in-patient model of care.
    Out of the 150 million square feet of real estate, nearly 6 
million are completely vacant, and many more underutilized. We 
need a methodical and data-driven review to determine how to 
adapt this physical footprint to meet the needs for the future.
    Lastly, but certainly not least, is the implementation of a 
modern commercial electronic health record. While the EHR 
modernization effort is necessary, it is very expensive. The 
contract with Cerner alone has a price tag of about $10 
billion, and that does not even include the cost of updating 
infrastructure to accommodate the new EHR.
    Implementation, support, and sustaining VistA up until the 
day it can be turned off--and after visiting Fairchild Air 
Force Base in Spokane, Washington, recently, I am not sure you 
can ever turn VistA off--we also have to resolve the question 
the new EHR's interoperability capabilities. It is unthinkable 
that VA could potentially spend billions of dollars on a 
project that does not substantially increase the Department's 
ability to share information with DoD or community providers.
    Yet, that is exactly what could happen if VA fails to 
proceed in a careful, deliberate manner. Therefore, I was 
relieved when Secretary Shulkin paused the award process to 
conduct an assessment of community provider interoperability, 
and I look forward to discussing any updates he can provide us 
with on that process today.
    The Department of Veterans Affairs has a sacred mission to 
serve those who have served our country. To date, VA is 
entrusted with significant resources, out-pacing those of 
nearly every other agency to carry out that mission. With 
substantial resources comes substantial responsibility to 
expend dollars wisely.
    On that note, before I yield to Ranking Member Walz, I 
would like to address a report released by the Inspector 
General yesterday regarding Secretary Shulkin's trip to Europe 
last year.
    Mr. Secretary, like many Members of this dais, I was 
disappointed in the allegations raised by this report. I, 
alongside Ranking Member Walz, and Senators Isakson and Tester, 
were briefed on this yesterday and I have instructed my staff 
to request additional documentation from the IG.
    I have gotten to know you well over the last year, actually 
two years, and I believe your intentions to serve and care for 
our Nation's Veterans are well clear. You have that mission at 
heart. With that said, as public officials, we are all expected 
to be held to a higher standard and be good stewards of tax 
dollars. I encourage you to take every step to address the 
findings of this report and make any changes necessary. We have 
got a lot of work to do on behalf of our Nation's Veterans and 
we cannot allow distractions like these to keep us from doing 
our work. I look forward to seeing your response.
    To the Members here today, I encourage you to remember the 
importance of the topic at hand. While I understand many of you 
rightfully want to ask the Secretary about the IG's findings, I 
ask that you keep in mind we are reviewing a budget request of 
nearly $200 billion, and that should be the focus of our 
discussion today. We have a responsibility to tax payers to 
thoroughly review that proposal as well.
    Today, the Secretary will testify that this is not a, 
quote, ``business as usual VA budget,'' end quote. I look 
forward to discussing exactly how this fiscal year's budget 
request will support a transformation to a more modern, 
efficient, and effective VA. And I am sure we all have many 
questions to ask, and we are all eager to receive the 
Secretary's testimony, so I will leave it at that for now. And 
with that, I will yield to Ranking Member Walz for any opening 
statements that he may have.

      OPENING STATEMENT OF TIMOTHY J. WALZ, RANKING MEMBER

    Mr. Walz. Well, thank you, Chairman. And as we get started 
today, I just like to say our heart-felt thoughts and prayers 
and, hopefully, our actions go out to our fellow citizens in 
Florida in the tragedy that once again befallen them.
    And, again, I appreciate the Chairman on this, and, Mr. 
Secretary, I too have gotten the opportunity to know you over 
many years, and your intentions to help Veterans is clear. And 
the trust you have on this Committee is strong, but we do need 
to address these allegations. And whenever we have an IG 
report, I think it would maybe be appropriate--and I appreciate 
the Chairman's already moving forward with that--to have an O&I 
hearing in here, clear these things up.
    You had three-and-a-half days to respond, which is a little 
unusual. Usually longer time is given to address these. And I 
would just say before moving onto the budget, the allegations 
of a potential hacking of a VA computer system with ill intent 
is a serious matter. I would ask you, Mr. Secretary, we are 
prepared to ask the Department of Justice to look into that if 
you think that is appropriate, and we will follow up to see if 
that is the appropriate action to go on.
    A budget reflects the President's priorities. Many of these 
priorities we are going to agree upon, some of them are going 
to be contentious. Rounding down, taking from one Veterans 
group to pay to another, we know those are there. I would 
address, and I have been here for much of that increase in the 
budget that is showing up there from 2006, and I would note 
several things have happened.
    Twelve years of war have happened. 2003, the budget was so 
underfunded that Priority 8 Veterans were asked to leave the 
system, they came back on in 2009, adding to that. And this 
Committee had the courage and the moral clarity to tackle the 
Nehmer claims, and the Blue Water Navy issue, and that added 
cost. And I think it is our responsibility, and the Chairman is 
exactly right, account for every penny of that, understand 
where that is at.
    But I think in the snapshot of things, that baseline where 
we started in 2006 was grossly inadequate from where it was, 
there were things that needed to be corrected, and it is just 
not the end money dollar. It is what we are getting for those 
dollars and the improvement of care for our Veterans.
    Several issues. Last week, Congress passed the Bipartisan 
Budget Act; included a VA budget caps, raising them $4 billion; 
and in 2019 for rebuilding, improving VA hospitals and clinics. 
So $4 billion was to address VA's significant infrastructure 
needs and backlogs and provide additional resources to the VA 
system.
    But this budget proposal is spending almost half of that 
increase on community care instead of VA hospitals. This is 
after we have authorized $4.2 billion in emergency supplemental 
funding for the VA Choice Program last year.
    Between fiscal year 2017 and 2019 request, community care 
spending will have increased 49 percent. This is compared to 9 
percent increase in VA funding care inside the four walls. Time 
and again Members of this Committee and key stakeholders have 
raised concerns over privatization of the VA. These numbers 
lend credibility to those concerns and you, on many occasions 
yourself, Mr. Secretary, said your intent is not to privatize 
the VA.
    Huge increase in community care spending is not enough in 
this year's budget, you are seeking to merge congressionally 
mandated account that was meant to provide greater 
accountability and transparency--an issue that you have 
championed--and how much care was being spent outside the VA. 
Merging these accounts will muddy our understanding of how VA 
is delivering care to our Nation's Veterans. As an oversight 
body, I hope you can understand our concerns with that 
proposal.
    At the end of last year there were over 31,000 provider 
vacancies and another 4,000 vacancies for logistic, human 
resources, and contracting positions that had not been filled 
because of an unofficial hiring freeze. I want to know how this 
budget plans to fill the vacancies, and if the hiring freeze 
will continue.
    Additionally, President Trump's budget proposes a pay 
freeze for Federal employees in fiscal year 2019. I want to 
know how the Department expects to recruit and retain the best 
providers and employees when our President does not appear to 
value their work.
    Just last week you testified in front of this Committee 
that your commitment to caregivers would be reflected in this 
budget; I did not see it. While you are willing to make 
astronomical requests to fund community care, you are not 
willing to do the same for caregiver community.
    I understand action on this issue could honestly come from 
either side of this witness table, and the Chairman has been a 
champion on this. I am doing the best from our side to do the 
same. Care givers deserve no less in our commitment to 
expansion to all Veterans from all eras. The cost of this 
expansion is small compared to what Veterans and their families 
and caregivers have been forced to pay. I was pleased to 
finally see a request for the new electronic health record in 
this budget, like to make sure we are updated on it.
    Here is one that is a touchy one. I notice that the budget 
for the IG would be scaled back 27 FTEs during 2019, leaving 
the OIG far short of their desired staffing level when the OIG 
meets increased demand for stronger oversight of VA's programs 
and services. Additionally, the pay freeze will prevent OIG 
from hiring investigators. The optics of cutting the IG today 
are really, really bad. So just so--it is something that I and 
the Chairman have championed for years together.
    So I look forward to the testimony today, Mr. Chairman, our 
common goals are absolutely clear, our commitment to our 
Nation's Veterans are clear. Getting the budget right to 
deliver that is our job up here, and I think this Committee is 
up to the task. And I yield back.
    The Chairman. I thank the gentleman for yielding. We are 
joined this morning by the Honorable David Shulkin, Secretary 
of the Department of Veterans Affairs. Welcome, Dr. Shulkin. 
The Secretary is joined at the table by the Honorable Jon 
Rychalski, Assistant Secretary of Management, Chief Financial 
Officer for the Department of Veterans Affairs. Welcome.
    Mark Yow, Chief Financial Officer of the Veterans Health 
Administration. James Manker, Acting Deputy Under Secretary for 
Benefits for the Veterans Benefits Administration. Matthew 
Sullivan, Deputy Under Secretary for Finance and Planning for 
the National Cemetery Administration. And Richard Chandler, 
Deputy Assistant Secretary for Resource Management for the VA's 
Office of Information and Technology.
    Mr. Secretary, you are now recognized for as much time as 
you may consume.

                 STATEMENT OF DAVID J. SHULKIN

    Mr. Shulkin. Thank you. Mr. Chairman, I want to thank you, 
and, Ranking Member Walz, I want to thank you for your 
leadership, and thank all the Members of the Committee. Many of 
you had a chance to come over to my office and spend some time 
talking about the issues, and I know all of you are very 
committed to the work that we are doing here today. It is why I 
think this is--we have the best Committee, the Veterans 
Committees, in the House and the Senate because we work well 
together in a bipartisan way.
    And, Mr. Chairman, and Ranking Member, thank you for 
keeping the focus of today on the important work that we have. 
This is a big deal, getting the resources right for our 
Veterans. I do regret the decisions that have been made that 
have taken the focus off of that important work. That is why I 
am here, I know that is why all of you are here, we care deeply 
about this subject. And it is the reason why, to keep the 
attention focused on the important things, that I have made the 
decision to reimburse the Treasury, to follow the IG 
recommendations, and I am committed to doing what we have to do 
to focus on Veterans and make this better.
    Today is about President Trump's 2019 budget and the 2020 
Appropriations budget. It is a very strong budget. It reflects 
the President's commitment to Veterans and their families. It 
provides the resources to continue VA modernization and to 
respond to the changing needs with increasing investments in 
our foundational services, greater access to care, effective 
management practices, and modernizing the infrastructure and 
our legacy systems.
    In the written statement that I prepared, I have detailed 
how we plan to invest these funds by targeting certain areas 
for innovation and improvement. The President's 2019 budget 
requests $198.6 billion for the Department that is $88.9 
billion in discretionary funding which includes medical care 
collections, and $109.7 billion in mandatory benefits.
    The discretionary budget represents an increase of $6.8 
billion, or 8.3 percent, over the 2018 request. This reflects 
an additional $2.4 billion in discretionary funding that is now 
available as a result of the recently enacted legislation to 
raise discretionary spending caps.
    The recent budget caps deal, an addendum to the 2019 budget 
request, are important to fully fund the community care and the 
Choice Program. Although we are talking about fiscal year 2019 
today, I would ask for your support in securing a full 
appropriation for the VA in 2018. As you know, VA relies on a 
second bite to tailor funding to our total requirements.
    The budget also seizes the opportunity to expand access to 
benefits and services which are focused on the five priorities 
that I have outlined. Providing Veterans with greater choice, 
modernizing our systems, focusing on resources on what is most 
important to Veterans, improving timeliness and services, and 
preventing Veteran suicide. Suicide is my top clinical 
priority.
    The budget includes $8.6 billion for VA's mental health 
services, an increase of $468 million, or a 5.8 percent 
increase above the 2018 current estimate. The increase also 
enables about 162,000 more outpatient mental health visits in 
2019, and directs $190 million for suicide prevention outreach. 
It also enables us to provide emergent mental health services 
to members who are administratively discharged under other than 
honorable conditions.
    The budget also enables us to effectively implement the 
President's July 9th executive order that supports 
transitioning military members with mental health services 
during that first critical year as Veterans. We are also 
targeting women's health, one of our fastest growing 
populations in VA, by adding almost $29 million in fiscal year 
2019, an increase of nearly 6 percent over 2018.
    The budget provides $1.1 billion in major construction 
funding as well, and $707 million in minor construction. I am 
proud that the 2019 request for infrastructure is the largest 
in the last five years. That will allow us to address VA's 
modernization, renovation, and aging infrastructure concerns 
that you mentioned, Mr. Chairman.
    In IT, this budget also allows us to innovate 
operationally, and includes an increase of $129 million above 
the budget of last year to enhance Veteran access and improve 
the Veteran experience.
    Another major project made possible by this budget is the 
financial management business transformation, replacing the old 
financial systems and providing us with a modern, innovative 
financial management solution. It also supports implementation 
of our electronic health record, as you mentioned, so we can 
coordinate care for Veterans who have received care not only 
from VA but also the Department of Defense and our community 
partners. The budget includes $1.2 billion to advance the 
implementation of this lifetime electronic health record.
    The 2019 budget also makes important investments in benefit 
services. For example, we will hire an additional 605 personnel 
for the Appeals Management Office, an increase of 40 percent, 
to implement reforms. And also hire an additional 225 fiduciary 
field examiners to ensure protection of our most vulnerable 
population.
    This budget reflects our efforts to reform business 
practices intended to do what is right for our Veterans and 
allows to continue our transformation of VA. But our 
responsibility does not end with simply asking for more money 
to support Veterans. It is our belief that by focusing on the 
well-being and the enhanced functioning of Veterans, conducting 
administrator reviews with disability compensation payment 
rates, and extending the stop fraud waste and abuse initiative 
in the benefit payments, we will make benefits more equitable 
for all Veterans, and wisely use tax payer resources.
    Advances in treatment and medical technologies have 
significantly reduced the impact of certain disabilities in the 
lives of many Veterans. Our goal is to get Veterans better and 
decrease their need for compensation, and to do that we have to 
modernize the rating system. More importantly, Veterans and 
their families deserve access, choice, and control over their 
health care. VA is working to build an improved integrated 
network for Veterans, community providers, and VA employees. We 
call this the coordinated access and rewarding experiences in 
Veteran care. It will allow us to simplify eligibility 
requirements, streamline administrative processes, and build a 
high-performing network to implement new care coordination for 
Veterans.
    As Secretary, my job is to build a modern, adaptable, 
sustainable VA for a changing world. More importantly, my job 
is to ensure that VA's benefits, their care, and policies are 
stronger in the future. This President's budget supports our 
mission at VA. In coming years these priorities will help VA 
maintain our commitment to our Nation's Veterans.
    Mr. Chairman, I look forward to working with you and the 
Committee on doing what is right for Veterans, and I look 
forward to your questions.

    [The prepared statement of David Shulkin appears in the 
Appendix]

    The Chairman. Thank you, Dr. Shulkin. And I will start by 
saying that, to the Ranking Member, that we have started a 
great discussion on caregivers, and we are going to continue 
that with a roundtable. And I would like to make that 
roundtable bicameral so that we can get both the senators and 
us all in the room together. I thought it was a great start the 
other day. And I do see a pathway forward where we can do this 
right, and get this done hopefully this year, would be my goal.
    On Choice, I sent all of you all, there is a great article, 
I still read my medical journals, and the journal, The American 
Medical Association, February 6, there is a great article there 
on ensuring timely access to quality care for U.S. Veterans. I 
would encourage all of you--I sent them to your office, it is 
just a two page read, and I would encourage all of you to read 
that.
    And, also, Mr. Secretary, you mentioned yesterday, we 
talked about this. And the VA--I think most people out in the 
country do not realize how extensive the VA is. We look at 
medical care and all the facets of medical care that VA does, 
the benefit process which we know has gotten slowed down a 
little bit, and we talked about that yesterday. By hiring 605 
people, I am concerned that hiring people who do not have the 
skill to do it will actually slow the process down.
    You get someone who is a really good claims adjudicator, 
they may be able to look at that claim and get it off their 
desk in a very timely fashion. Whereas someone who is brand new 
will kick it into the appeals process, and this is where it 
gets really slowed down. So I would encourage you to make sure 
that those 605 people are thoroughly vetted and trained before 
they are turned loose on a single claim.
    Information technology, electronic health record, these are 
all in and of themselves huge projects, but all under the one 
umbrella of the VA. And I do want to give, in my short period 
of time, a shout out to the cemeteries. One thing that the 
Cemetery Administration does in this country is that I have a 
national cemetery within a mile-and-a-half of where I live, and 
it is a park-like setting, it is in a reverent setting, and I 
want to thank you all. Every VA Cemetery that I have visited 
has been immaculate, and well cared for, and honored. So I want 
to thank you for that.
    And construction. We know that VA is in the process of 
modernizing. We are looking at, I don't know, 6,000-plus 
buildings that you all--or under your purview, you are one of 
the largest real estate holders in the world probably. So 
getting that footprint right is a huge project that we have.
    I am going to start out because we know that the community 
care, you asked us to have a Choice program put together a 
little sooner than we have, but assuming that all community 
care consolidation legislation is enacted next month, let's say 
we can get that done next month, how much more funding for the 
existing Choice program, the existing non-VA care program, and 
the consolidation process itself will be necessary before we 
implement the consolidation? My assumption is all of this 
funding is provided under the Bipartisan Budget Act, the new 
discretionary caps arrangement; is that correct?
    Mr. Shulkin. Well, as you know, the President's budget, as 
proposed, funds community care by putting this all in through 
discretionary. That would be a 9 percent increase in funding 
above the 2018 levels. The situation that we have right now is 
that without new legislation, we have funded the Choice program 
through the end of this May.
    And so what this President's budget does is it essentially 
puts more money into the 2018 budget so that we can get through 
the end of the year. But we do believe the legislation is 
important so that we can collapse this into a singular program. 
And that is going to be a better use of the money make it 
better for Veterans.
    The Chairman. I think you explained to us it was about a 
year process to do this, correct?
    Mr. Shulkin. Yes. To transition to a new system, to 
integrate all of the programs together, to change the 
eligibility requirements to give Veterans greater choice will 
be about a year's transition process.
    The Chairman. And I think, as you explained yesterday, that 
about 36 percent of VA health care is provided in the community 
now; is that correct?
    Mr. Shulkin. That is correct. When I arrived at VA in July 
2015, it was about 22 percent, now it is at 36 percent.
    The Chairman. Mr. Secretary, you announced your electronic 
health record modernization decision last June, and recently 
paused that contracting process to conduct an assessment of 
interoperability. What will the DoD and community operability 
look like in a couple years, five years, ten years? And my time 
is about expired.
    Mr. Shulkin. Well, I think this is a huge decision. No one 
has ever implemented an electronic health record change this 
big, so we are taking it very seriously. And given the track 
record of implementing big IT projects, we have to really make 
sure that we got this one right.
    We will clearly, first of all, there are four stages of 
interoperability. Everyone thinks VA has an electronic health 
record today, VistA, we don't, we have 130 electronic health 
records, 130 different parts of VistA. So this will bring us to 
a single electronic health record within VA.
    Secondly, since this proposed to be the same system that 
DoD uses, we will for the first time have an interoperable 
system with DoD. The reason I paused was because I want to make 
sure that those 36 percent that are getting care in the 
community, we can actually understand what care they got and 
make sure that we are doing the right job for Veterans.
    So we have to make sure that we can be interoperable with 
dozens of different health communication systems or records out 
there. And that is a challenge that, frankly, the American 
health care system has not figured out yet. We think VA can 
help lead this for the whole country by making this 
interoperable.
    The Chairman. I thank you, Mr. Secretary. My time has 
expired.
    Mr. Walz you are recognized.
    Mr. Walz. Well, thank you, Mr. Secretary. And there is lots 
of issues, and we will dig down into deep ones, and many 
Members will ask it, but the big question we have is, is 
striking that balance between the care and the research in the 
VA versus the community care, that we all know in this room has 
always been there, trying to streamline it under Choice, trying 
to respond to some of the issues that arose several years ago. 
Do we have enough money to make it until May in the Choice 
program?
    Mr. Shulkin. We do, until the end of May.
    Mr. Walz. How do we know that?
    Mr. Shulkin. Because we are tracking this on a weekly 
basis. We are on spend rate in the Choice program between $350 
and $400 million. You authorized $2.1 billion back in December, 
and so when we do the math, and we are tracking it, we are okay 
until the end of May.
    Mr. Walz. Are we providing care based on the amount of 
money that is there, are we providing the care, and then 
whatever, the money will follow?
    Mr. Shulkin. The latter. We are putting the Veterans' needs 
first and the money follows.
    Mr. Walz. All right. We gave $4 billion for infrastructure. 
It appears that that money is not going to be used for 
infrastructure and it is going to community care. Am I reading 
that correctly?
    Mr. Shulkin. No, I don't think that is exactly right. And 
so I am going to turn to Jon to explain the $4 billion because 
it certainly makes sense that there has been some confusion 
about tracking that money.
    Mr. Rychalski. You are talking about the 2019; is that 
correct?
    Mr. Walz. Correct.
    Mr. Rychalski. Yeah. So I think we are asking for the money 
where it is most needed. And what I would point to is the major 
and minor construction request for 2019 is the largest in five 
years. As I look to the nonrecurring maintenance for the last 
two years, it is substantial, it was $1.9 billion and $1.4 
billion. And so I think when we look at the absolute need--and 
I am not discounting the aging facilities--based on the funds 
available, we could better use that funding, frankly, in 
community care.
    Mr. Walz. We are talking about the $20 billion in backlog 
that is out there of how we attempted to handle that, and I 
will have to say, like many of you, I turned on my morning news 
one day and I saw that the President had issued an executive 
order on mental health care, an issue that I have been somewhat 
engaged in over the last 12 years. That is $500 million. Where 
is that coming from?
    Mr. Shulkin. Well, we were able to get that with the 
additional, once the budget caps--once your deal was reached, 
we were given an additional $500 million to be able to support 
that executive order. We had originally made the decision, as 
you know, Ranking Member, because we thought it was the right 
thing to do. Our focus is on suicide and we did not worry about 
the money, but we are fortunate that the $500 million was given 
to us to make sure that was done thoroughly and appropriately.
    Mr. Walz. And I am sure they are busy, we have worked on 
this a lot in Clay Hunt Bill, our phone number's down here, we 
would help, and we were under the assumption that money was 
going to inside the VA which all the research and the RAND 
Corporation shows is far more successful than mental health 
care outside the walls.
    So probably a discussion for this Committee to have. So now 
what I am seeing is a request for fiscal year 2020, advanced 
appropriations is based on the baseline, it reflects close to a 
50 percent increase in community care. Is that the norm going 
forward, we are going to start increasing 50 percent in care in 
the community?
    Mr. Shulkin. I don't think so. I think that we have seen a 
significant increase as we have begun to address the access 
crisis. As you know, this really was a significant crisis in 
2014, we still have some access issues, and so we are getting 
Veterans out to be seen rather than letting them wait. That, I 
think we all agree upon.
    I think that we have reached essentially a much slower 
growth rate of that, but we are doing what you said, which is 
we are making sure that Veterans are being cared for 
appropriately and then we are letting the money followed that. 
I do not think we are going to see the same continued rate of 
growth. I think what you saw here was a Choice program 
implemented that was complex, that people were not able to use, 
finally now three years later they are understanding how to use 
it, and that is why we saw such a big growth.
    Mr. Walz. And Choice is good, I have always supported it. 
If the Choice that is not being given is a VA that is funding 
those 30,000 positions. So we are making a choice now that, 
yeah, they are not going to get the VA because there is no one 
to see in the VA because those appointments are open. So now 
the alternative is, is that we are going to care to the 
community.
    So instead of spending money to hire those 30,000 we are 
going to continue to shift. We have never been against trying 
to strike this balance, but when we appropriate $4 billion and 
say it is for infrastructure, and a big chunk of it is going 
out, when we have executive orders shifting money out after we 
have not seen full implementation of the Clay Hunt Act that 
actually went through the regular order, the will of the 
people, was passed and signed into law, and now we have an 
executive order on a Saturday morning that no of us know about, 
my frustration is, I think it is becoming more and more 
difficult, Mr. Secretary, for you to say I am not supporting 
privatization of the VA because it appears that you are.
    And I say that non-pejoratively because if that is the best 
way to get Veterans care, we certainly support that. And in 
many cases it is, but not in the bulk of it, and not in what we 
are asking on the research. So I still have deep concerns that 
this budget is going to continue that trend without the input, 
without the knowledge, and I think that is the wrong approach 
because Veterans themselves have made it very clear they wanted 
that fully funded VA. I yield back.
    The Chairman. I thank the gentleman for yielding. An 
announcement Jon just told me here. Our caregiver roundtable is 
going to be March the 6th. So we are moving quickly with that.
    Mr. Coffman, you are recognized.
    Mr. Coffman. Thank you, Mr. Chairman. And, Mr. Secretary, I 
am looking at your construction budget. You say, I think, it is 
$1.1 billion in major construction and $707 million in minor 
construction for our priority infrastructure projects and 
cemetery expansions.
    So the last four hospitals that the VA managed each were at 
least hundreds of millions of dollars over budget, years behind 
schedule, the worst example being in my congressional district 
which was a billion dollars over budget and four years behind 
schedule.
    One of the efforts that I led in the Congress was to strip 
the VA of their construction management authority for building 
major construction projects, hospitals, at a hundred million 
dollars and above. I think that number is way too high. I think 
it needs to go way down. The same people that had their 
fingerprints on these four construction projects that were 
years behind schedules, and hundreds of millions of dollars 
over budget, are the same people that are in charge of 
construction management today in the Department of Veterans 
Affairs, it is unchanged. The people that have their 
fingerprints over this stuff are still the same people there.
    I want to encourage you, without legislation--and if it 
requires it, we need to move it forward--that you need to find 
these people another job, hopefully somewhere outside of the 
Federal government, and you need to shift that responsibility, 
as we did in my hospital in my district, to the Army Corps of 
Engineers, to some third party outside the VA because the waste 
and abuse is just incredible.
    Mr. Shulkin. Yeah.
    Mr. Coffman. Can you respond to that?
    Mr. Shulkin. Well, Congressman, you have been very vocal on 
that, and I think you have been right. There is no excuse for 
these past projects, and we cannot continue to do business as 
usual. The Army Corps, as you know, is involved in every one of 
our major construction projects now above a hundred million 
dollars.
    But I think we need to do a different way in the future, 
and I think that way of the future are public/private 
partnerships where the private sector helps us build. That is 
why we are excited about this project in Omaha, Nebraska, that 
we are going to do a groundbreaking on, a different model of 
constructing VA facilities.
    Four hundred million of the major construction will be for 
seismic improvements because we have ignored those for a long 
time. In terms of reorganizing and different personnel, we are 
committed to doing that. We cannot continue to do it the same 
way. We are going to be reorganizing our whole internal 
approach for construction, and facilities, and logistics. And 
the people that job is being recruited for, we are going to 
look for people with outside expertise, and we think you are 
pushing us in the right direction, Congressman.
    Mr. Coffman. Can you comment very quickly on your idea for 
reducing mandatory spending in terms of disability?
    Mr. Shulkin. Yes. Our growth in this budget, the VA budget 
from 2006 to 2020 is increasing by 175 percent. The Federal 
budget has increased by 52 percent during that same timeframe. 
We cannot continue to do business as usual and think that the 
VA is a sustainable structure for decades to come, which we 
know it needs to be.
    So we have got to look at things differently. We want our 
benefits to focus on getting Veterans back to independence and 
well-being, and all of our efforts should be to help restore 
the quality of life of our Veterans, and we want to change the 
focus of our program to make sure we are doing that. We believe 
it is good for Veterans and that will decrease the rate of 
spend of our mandatory program.
    Mr. Coffman. Well, last point. I know this is not about the 
IG investigation, but you issued a memorandum prior to your 
trip to Europe last summer; essential employee travel. Now I am 
going to quote from the IG report. The memorandum instructed 
staff that before approving any employee travel, managers must 
determine whether the travel is essential in order to decrease, 
quote, ``employee travel and generate savings,'' end quote, 
within the VA.
    Do you think that your trip last summer met that criteria?
    Mr. Shulkin. I do. I believe that this was essential 
travel. This was the Five Eyes Conference, our allies who fight 
alongside of us in every war; Canada, New Zealand, Australia, 
the United Kingdom, and the United States. We have had this 
conference for 43 straight years, it has been attended by every 
VA secretary. If the United States, as the largest of those 
military forces, do not go to talk about veterans' health 
issues--this conference was on veterans' mental health--if the 
United States does not participate, that ends, that conference 
ends.
    I planned on going to it for a year-and-a-half because we 
plan these things ahead of time. But I do recognize the optics 
of this are not good, I accept responsibility for that, but I 
do believe it is important the United States continue its work 
with its allied countries.
    Mr. Coffman. It is not the optics that are not good, it is 
the facts that are not good. I yield back.
    The Chairman. The gentleman's time has expired.
    Mr. Takano, you are recognized.
    Mr. Takano. Thank you, Mr. Chairman. Mr. Secretary, I want 
to echo the sentiments of my colleagues regarding the IG report 
that was released this morning. Any misuse of tax payer money 
is a significant breach of the trust we place in public 
officials, particularly those responsible for serving our 
Nation's Veterans.
    I am profoundly frustrated that this mismanagement has 
interfered with our mission of building a stronger and more 
sustainable VA. Now it is vital that you work to restore the 
trust of the American people and our Veterans so we can get 
back to the critical work of caring for those who serve. And I, 
too, with the Chairman and my Ranking Member, have gotten to 
know you and know your dedication to the mission of this 
department.
    I want to ask, quickly, a few questions. How does this 
budget address over 30,000 provider vacancies, and 4,000 
additional vacancies in administrative staff, specifically in 
logistics, procurement, and contracting, and human services? Is 
the unofficial hiring freeze still in effect?
    Mr. Shulkin. There is no hiring freeze.
    Mr. Takano. Okay. Do you support the President's proposal 
to freeze Federal employee pay in fiscal year 2019?
    Mr. Shulkin. I am going to take the leadership from that 
from the President. That would be across the administrations. I 
think it is essential for us to get the right people in VA, 
that we have competitive salaries. And I would be concerned if 
we fall behind in that. So we are going to use our market 
assessments that we have, our ability to do that, particularly 
using Title 38 to make sure that our salaries are competitive.
    Mr. Takano. I gather there would be some concern over a 
hiring freeze. How would a Federal employee pay freeze affect 
recruitment and retention in the Department?
    Mr. Shulkin. Well, you know, we are competing, particularly 
in health care, but in all aspects of VA, to get the very best 
employees. And we know where we do not have competitive 
salaries that our vacancies stay open or we get the wrong 
people into the organization. So it is essential that we remain 
competitive on benefits and salary.
    Mr. Takano. Now with regard to the hiring freeze, 
potentially in fiscal year 2019, would you be willing to ask 
the President for a waiver if you felt that the needs of the VA 
were so affected?
    Mr. Shulkin. I certainly would. The first thing I would 
want to do is to make sure we are maximizing our authorities 
under Title 38 and Title 5. But if it got to the point where I 
was not able to recruit the people that our Veterans deserve to 
have caring for them, I would absolutely ask for a waiver.
    Mr. Takano. I am pleased to hear that. When I recently met 
with management from my local medical center, they said that 
they were having difficulty recruiting and retaining 
housekeeping staff because pay was too low. Now housekeeping 
staff may not be the most glamourous position, but it is 
absolutely vital to keep facilities clean and ensuring patient 
safety, and you know that in many cases the cleaning staff have 
to be specially trained around biohazards and all that. Won't a 
pay freeze exacerbate this problem and endanger patient safety?
    Mr. Shulkin. There are a number of occupations within the 
VA, I think housekeeping, environmental services is one of 
those, where when you clean a hospital, this is not the same--I 
think you are saying this--this is not the same as cleaning an 
office building. Making sure that people understand the type of 
microorganisms that live in hospitals, and the reason why you 
have to clean these environments, is lifesaving.
    And so we are working to change the job specifications and 
the grades of these jobs so that we can be competitive. But we 
have a big problem hiring enough environmental workers right 
now. So we have to change that.
    Mr. Takano. Won't a pay freeze exacerbate this problem and 
endanger patient safety?
    Mr. Shulkin. If we did not change the grade of that 
position, that would, yes.
    Mr. Takano. Yeah. What resources do you need to ensure 
these vital positions are filled?
    Mr. Shulkin. Well, we have to get more nimble about how we 
grade these positions and how we change as, essentially, the 
outside world changes, and we need to make our hiring practices 
easier to be able to get the right people on board. This is 
work that is underway now in the transformation of VA.
    Mr. Takano. We have heard reports that human resources 
personnel at local facilities were directed by VA central 
office to not proceed on salary surveys for jobs despite 
significant vacancies at facilities; is this true?
    Mr. Shulkin. If that is true, let me make it clear right 
now, that should not be followed. We want our facilities to do 
the market surveys, they need to be competitive, we have to 
fill these vacancies, there is no hiring freeze. Our people who 
work in our facilities are our most valuable asset, and we have 
to make sure we have the right people serving Veterans.
    Mr. Takano. Mr. Chairman, my time is up. Could I ask one 
more question, or?
    The Chairman. Yes, sir.
    Mr. Takano. In many cases, like the DC VMAC and the failed 
medical surgical prime vendor program, vacancies in staff and 
leadership positions directly contributed to the postponement 
of procedures and effective patient care. How does this budget 
address vacancies for procurement, HR, and logistics personnel?
    Mr. Shulkin. Well, this fully funds our needs, and people 
should be filling those positions. And I think you are right 
that in the case of the DC VA they were understaffed, we had to 
bring in a large number of new people in procurement. Human 
resources should not be under resourced. Without that, the rest 
of the organization does not work.
    Mr. Takano. Thank you very much.
    The Chairman. I thank the Gentleman for yielding. And the 
Ranking Member and I were talking. I think part of the problem 
with staff in the VA, it is not VA it is countrywide. We have 
at home, our hospital at home, is having a terrible time 
filling nursing positions and other positions, it is not just 
hospitals but it is business in general. The jobs are out there 
if we can find the trained people.
    Chairman Bost, you are recognized for five minutes.
    Mr. Bost. Thank you, Mr. Chairman. Mr. Secretary, you know 
we--there are some concerns right now as the new appeals 
process goes into place that the VA will prioritize and fill, 
or go after the new system, those newly filed appeals and then 
kind of walk away from the old legacy appeals. You know, I note 
in the President's budget that the request for additional 605 
full-time equivalents dedicated to VBA appeals. How many of 
those FTEs will the VA dedicate to processing legacy appeals?
    Mr. Shulkin. Okay. That is a great question. Jamie, do you 
want to take that?
    Mr. Manker. Sure.
    Mr. Shulkin. Jamie is from VBA.
    Mr. Manker. So that is a great question, thank you for it. 
The first thing we are doing to address legacy appeals is we 
are giving the appellants the opportunity to opt into the new 
appeal process as we speak. What we have done is we have 
undertaken a process where we have gone to the appellants who 
have had the longest appeal and said, you have the first 
opportunity to opt in. And we are going along several thousand 
a week, sending letters to the appellants and to their powers 
of attorney, and telling them that they have the opportunity to 
opt in.
    Mr. Bost. Okay. But that is not my question. My question 
is, of those 605, how many are now going to be dedicated to 
clearing up the old backlog? Are they specifically going to be 
that, or is it just going to be across the board, or?
    Mr. Manker. So all of our appeals personnel will be working 
appeals. So we will have roughly 2,005, I believe is the number 
of appellants afterward.
    Mr. Shulkin. Yeah, but he is not talking about appeals, he 
is talking about the legacy--
    Mr. Manker. The legacy.
    Mr. Bost. The legacy claims.
    Mr. Shulkin. So they are making progress in this. I do not 
think any of those are going to the legacy claims. But what 
they have done is they have implemented something called a new 
type of claim, a DRC claim, that gets this done in 38 days 
instead of the usual several hundred days. And so they are 
making great progress on the claims.
    Mr. Bost. But I am still concerned about this--
    Mr. Shulkin. Yeah.
    Mr. Bost [continued].--and this is across the board as we 
work through that Committee, the concern that we have is these 
legacy appeals we are trying to catch up on--
    Mr. Shulkin. Yes.
    Mr. Bost [continued].--you are asking for 605 more 
employees.
    Mr. Shulkin. That is right.
    Mr. Bost. We have got to speed the process up. Is that 
going to speed the process up to answer these appeals and get 
them taken care of?
    Mr. Manker. Absolutely, it will speed the process up. We 
have more, if you will, more FTE to work appeals, and we will 
both--we will do a blended approach to working those appeals.
    Mr. Bost. Okay.
    Mr. Manker. Both the legacy appeals and the new appeals--
    Mr. Bost. Because I think it is a concern of our Committee 
that, you know, it is one thing to handle the new ones--
    Mr. Manker. Sure.
    Mr. Bost [continued].--but these people have been a long 
time, folks.
    Mr. Shulkin. That is right.
    Mr. Bost. And the concern that we see out there, and the 
weight on their families trying to get an answer, the reason 
for changing it was to try to straighten it up. My hope is that 
they are aggressively on this.
    Mr. Manker. And absolutely. And as I indicated earlier, we 
are giving the opportunity to opt into the new process those 
that have been waiting the longest in the appeal line, if you 
will.
    Mr. Bost. Okay. Mr. Secretary, you said you do not think 
any of them are going to go to the--
    Mr. Shulkin. The 605 are--I think as Jaime said--are going 
to be focused specifically on addressing the appeals, not on 
claims.
    Mr. Bost. Okay.
    Mr. Shulkin. Right?
    Mr. Bost. Okay. Yes.
    Mr. Shulkin. Yeah.
    Mr. Bost. So, okay. I want to go to another quick question 
because, you know, you know the problems we have had in my 
district with Marion VA, right now the President's budget has 
requested $172 million for the Office of Inspector General to 
strengthen accountability. I have two questions. One, was this 
level of funding sufficient to properly inspect and keep up 
with the problems that are in the VA? And, second, do you need 
new authority to establish clear-cut qualifications for 
positions like HR?
    Mr. Shulkin. Yep. On the Inspector General. My 
understanding--and, Jon, I am going to ask you to confirm 
this--is that they increased the levels last year, and this 
allows them to continue what they raised last year; is that 
correct?
    Mr. Rychalski. So I think what happened is they
    had under-executed their program previously, they had some 
carryover funding, so they hired people sort of above their 
baseline funding level. And the--
    Mr. Shulkin. Last year?
    Mr. Rychalski. Correct. And then so the sustainment funding 
for that was less than what they had hired above, so they 
requested an increase. They did receive an increase. And what I 
would say, though, just subjectively, I absolutely support a 
strong IG, obviously I worked in the financial realm. But I 
think that we need to look at what the requirement is. We have 
a manpower office because I think you can't have just self-
determined need, it has got to be validated somewhere.
    Mr. Bost. I think if you look at the line on that it 
actually decreased.
    Mr. Rychalski. The IG's total budget?
    Mr. Bost. Yeah. The FTE.
    Mr. Rychalski. Right. FTEs, that is why I just sort of 
described how that occurred.
    Mr. Bost. Okay.
    Mr. Rychalski. They hired above their baseline funding with 
carryover funds. And so they hired more than they had money for 
in one year and they requested the additional funding. They 
received some of it, but they still hired above what their 
funding level was. My point is that the actual need should be 
validated. It could be what they say, it could be more, it 
could be less.
    Mr. Bost. Okay. Thank you. My time has expired. Thank you. 
I yield back.
    The Chairman. I thank the gentleman for yielding.
    Ms. Brownley, you are recognized.
    Ms. Brownley. Thank you, Mr. Chairman.
    Mr. Secretary, I wanted to focus a little bit on the open 
nominations. I think there is clearly a lack of consistent 
leadership within the VA that I think is a barrier to many of 
the challenges that the VA faces. And at least the last I 
heard, there is 8 out of 22 leadership positions in VHA that 
are being filled by individuals in an interim or acting role.
    I know that we do not have an Under Secretary for health, 
we do not have--a permanent one anyway, Under Secretary of 
health or Under Secretary of benefits. What progress are we 
making in terms of finding candidates to fulfill longer term 
leadership within the VA?
    Mr. Shulkin. Yeah. I appreciate that. I think I share that 
same concern, it is taking us too long to get these positions 
filled. The Under Secretary for Health, we had our third round 
of commissions. In other words, this is the third time we have 
had to have a commission interview candidates, that was on 
Tuesday of this week.
    Yesterday I was given three names from the Commission, so 
they completed their work. I am in the process now of 
evaluating them. And then we will make those three names, if 
they are vetted through, to the President for a nomination. So 
I am hopeful on that.
    The Under Secretary for Benefits, the Commission did meet. 
We did submit three names to the President, and they are in the 
process now at vetting those candidates at the White House. The 
CIO position, in a similar way where we have submitted some 
names to the White House and they are vetting them. So this is 
a long process, takes too long, but I feel like we are making 
specific recommendations to be able to get these positions 
filled.
    Ms. Brownley. Are you waiting for these positions to be 
filled for those folks who are in the position to then hire and 
fill other important sites?
    Mr. Shulkin. No. No.
    Ms. Brownley. Thank you. I share the concerns and the line 
of questioning that my colleague Mr. Takano asked. And, to me, 
in terms of these many, many vacancies throughout the VA, one 
of the--I think the heart of the issue is predominantly around 
lack of human resource personnel. And I just need to hear from 
you a commitment that you have a sort of a laser sharp focus on 
filling these positions so that they can roll up their sleeves 
and get down to work to actually fill these other very critical 
positions across the country.
    Mr. Shulkin. Yeah. I agree. I would be concerned if anybody 
out there believes that there is a freeze or any desire not to 
completely staff your human resources office. That is, I agree 
with both of you. This is a critical area to make sure that we 
are fully staffed in.
    Ms. Brownley. I mean, I know within my VISN in Southern 
California that, and beyond, but that is the primary issue is--
at least when I ask the questions, it is because human 
resources is not able to fulfill their responsibilities on a 
timely basis. So I wanted to ask in terms of the President's 
executive order on mental health in the community. What does 
the implementation of that look like?
    Mr. Shulkin. We are planning on presenting a detailed plan 
back to the President March 9th, that will be 60 days after the 
President issued executive order. What that looks like is, pre-
enrolling the servicemembers before they leave on the last day 
of service so that they do not have to wonder how they get 
access to benefits, that they already have them right there.
    Offering an initial, what we will call an introduction to 
the benefits and the services that every servicemember would 
have so that they understand that asking for help and getting 
the type of services that are offered at the VA is available to 
them. We plan on using peer counselors because we feel that is 
one of the strongest ways to help people understand about how 
what they are going through and how they might get help. And 
providing expedited access to those that need help at the right 
time.
    Ms. Brownley. And when that plan is complete, and you 
present it to the President, will you also present it to the 
Committee?
    Mr. Shulkin. Yes. Absolutely.
    Ms. Brownley. Thank you. I yield back.
    The Chairman. I thank the gentlelady for yielding.
    I now will yield to my good friend Dr. Wenstrup, who I 
overlooked in the last questioning. He can have as much time as 
he wants to consume.
    Mr. Wenstrup. We will stick with the five minutes. Thank 
you. Mr. Secretary, in the idea of flexibility and being able 
to make decisions that make sense we take a look at our unused 
or underutilized assets, and I think there is 131 vacant or 
mostly vacant buildings that have been repurposed or disposed 
of. And I am wondering how much revenue we have gained from 
that, or did it cost us more to get rid of them in the short 
term but maybe save in the long term, could you give me some 
insight on that?
    Mr. Shulkin. Yeah. No, I think you are correct. It often--
part of the reason why these buildings remain standing, and 
vacant, and become problems is because it sometimes takes 
capital to knock them down and clear the site, but we have 
started to do that.
    The recurring savings from those 131 buildings is about $7 
million a year. In some cases, we have had to invest some money 
to be able to remove those facilities or get rid of them, but 
it is overall a savings. The infrastructure bill that the 
President has just introduced, when they talked about VA, will 
allow us to use those savings, or if we sell the buildings, to 
reinvest in VA infrastructure. So we are very grateful for that 
provision which has not existed before.
    Mr. Wenstrup. So that leads to my next question. You are 
tracking that particular amount of money, if you will, and 
where it is going. Now is it going strictly to new 
infrastructure, to modernization? What is the plan there?
    Mr. Shulkin. Right. Well, currently today if we exit a 
property that money gets returned to the U.S. Treasurer, we are 
not able to reinvest that. The infrastructure bill would change 
that. So that is why we are very supportive of that. What we do 
save are the recurring savings, the maintenance. So we do not 
heat the buildings, we do not have to repair them if we get rid 
of them. That, remains in our general, what we call our NRM 
budgets, our recurring maintenance budgets.
    Mr. Wenstrup. Do you think there will be a way to in some 
way get an idea of how it is converted, directly or indirectly, 
to care or--
    Mr. Shulkin. Yes.
    Mr. Wenstrup [continued]. --Veteran services?
    Mr. Shulkin. Yes. Yes. And what we would plan on doing is 
reinvesting that money back into probably NRM or minor 
construction projects.
    Mr. Wenstrup. Okay.
    Mr. Shulkin. We could track that.
    Mr. Wenstrup. Thank you. Another question I have is, one of 
the things that budget talks about is foundational services and 
service-connected disabilities, but then the list includes 
geriatrics and primary care, all part of the mission. I guess I 
am trying to understand what we consider foundational services, 
service-connected, if you can give me some clarity on that.
    Mr. Shulkin. Yeah. We have spent a lot of time on this, 
Congressman, and, clearly, this is about making sure that those 
things that the VA needs to do well for its--for the people who 
have served, we are doing in a world-class way. And so there is 
no doubt things like spinal cord injury, and blind 
rehabilitation, and post-traumatic stress, and focusing on the 
suicide issue, and other things clearly are foundational 
services.
    But as part of the VA definition of health, how we do this, 
we do believe a system of strong primary care, geriatrics care 
as a primary care specialty of older people, women's health, as 
well as mental health is the foundation of what a strong 
integrated system needs to have.
    We do not need to be doing everything, and we do not--we 
cannot do everything well, we have learned that in the past. 
But these services, every VA facility needs to be focused on to 
do in a world-class way.
    Mr. Wenstrup. Thanks for that clarity, and I would tend to 
agree because something that may be clearly service-connected 
cannot be treated as efficiently if you do not have proper 
primary care. So I think that is what you are saying.
    Mr. Shulkin. Yes.
    Mr. Wenstrup. Thank you. And I yield back.
    The Chairman. I thank the gentleman for yielding.
    Mr. O'Rourke, you are recognized for five minutes.
    Mr. O'Rourke. Thank you, Mr. Chairman.
    Mr. Secretary, I wanted to begin by thanking you for your 
focus on reducing Veteran suicide. You mentioned that this is 
your number one clinical priority. You are the first VA 
secretary, to my knowledge, to make this such a high profile 
issue. And I am convinced that as we acknowledge the problem 
that we have, and by your estimate it is 20 Veterans a day 
every single day are taking their lives.
    We know that for those Veterans who have an other than 
honorable discharge--hundreds of thousands of U.S. Veterans 
have an other than honorable discharge--tens of thousands of 
them were diagnosed with post-traumatic stress disorder, or 
traumatic brain injury, or other conditions unique and caused 
by their service who are effectively denied access to VA health 
care.
    I know you have worked with Congressman Coffman, and 
myself, and others to try to expand access and thereby save 
more lives. In El Paso we know that there is a correlation 
between the number of mental health care providers and access 
to mental health care help and reducing Veteran suicide.
    We went from 68 full-time mental health care staff to today 
122. More Veterans are getting care, they are waiting fewer 
days to get in to see a psychologist, or a psychiatrist, or a 
therapist, and I know you have personally taken an interest in 
this and helped us to do that. So I want to thank you.
    So to that point. If there are 30,000 authorized 
appropriated for unfilled clinical positions, how many of those 
30,000 positions are psychiatrists, and psychologists, 
therapists, neurologists, others who will help with the unique 
conditions connected to service, the unique conditions that are 
too often connected to Veteran suicide?
    Mr. Shulkin. Yeah. Last year we hired 763 psychiatrists and 
psychologists. Unfortunately, it was only a net of about 260 
because--
    Mr. O'Rourke. Retirements.
    Mr. Shulkin [continued]. --retirements, and people 
sometimes choose to find other places to work. So we have a 
need right now for at least a thousand new mental health 
professionals in this fiscal year, and we focused on trying to 
hiring them. The budget allows us, with an increase of close to 
$500 million in mental health funding, to fund for an 
additional 162,000 mental health visits. And when you look at 
how you would have to staff that, that is about a thousand 
mental health professionals.
    Mr. O'Rourke. How many of the 30,000 unfilled clinical 
positions are primary care providers?
    Mr. Shulkin. I do not have an exact number, but my guess 
is, is that we probably are--when you say primary care 
providers, I am going to talk about advance practice nurses too 
as well as family doctors and internists.
    Mr. O'Rourke. Let me do this because--
    Mr. Shulkin. Yeah.
    Mr. O'Rourke [continued]. --both answers are very important 
to me.
    Mr. Shulkin. Yes.
    Mr. O'Rourke. And I am going to hang out until the end of 
the hearing. I know your team in your office is watching this.
    Mr. Shulkin. Yes.
    Mr. O'Rourke. Have them get you the number, I will wait, I 
want to make sure everyone here knows.
    Mr. Shulkin. Thank you. Let's do that.
    Mr. O'Rourke. This is a priority, let's understand what the 
delta is and we are all going to do to bridge that gap, and the 
hiring, and the resources, prioritizing for those hires. Do you 
think that a Veteran's primary care provider should be in the 
VA?
    Mr. Shulkin. I think that--my preference would be that we 
have--since VA uses a different model of primary care does 
not--in the outpatient environment, where I am a primary care 
provider in the private sector, patients are usually seen about 
every 15 or 20 minutes. The VA gives a longer period for a more 
comprehensive evaluation. And our definition includes 
behavioral health integration, it looks at military issues in a 
broader way. So I believe primary care providers need to have a 
military competence when they see--
    Mr. O'Rourke. So is that a yes, we want Veterans because--
    Mr. Shulkin. Or they need to be trained well if they are in 
the private sector.
    Mr. O'Rourke. Well, let me make the case--
    Mr. Shulkin. Yeah.
    Mr. O'Rourke. --and I hope I can get you to agree that if 
we make the VA central to the Veteran's care, we understand 
they may need to be referred out if there is not capacity or 
specialization within a given VA, but if we make the VA central 
to that Veteran's care, that VA provider will know the signs to 
look for suicidal ideation, they have taken care of other 
Veterans and servicemembers, that they are going to have a 
higher proficiency and a greater level of experience taking 
care of those Veterans, and I think those Veterans are going to 
get better outcomes as a result.
    And so I would just request that that be, if it is not 
today, and it sounds like it is unclear, I think that needs to 
be VA policy, and a VA priority. And I would add that I think 
for those treatments that are unique to service and combat--
post-traumatic stress disorder, traumatic brain injury, 
traumatic amputation, spinal cord injuries--that has to be 
within the VA.
    I would ask you to prioritize your hiring for those 
specialty, specialists, and primary care providers who ensure 
that care for the Veteran is anchored within the VA. I share 
some of the concerns that others have raised, including 
Veterans who come to our town halls, that there is a move to 
privatize care. I want that care centered in the VA. And so I 
am going to await the answers to the specific questions I asked 
on hiring, hopefully you can get those to us before the end of 
the meeting.
    Mr. Shulkin. I hope you are right that they are watching so 
that we can do that for you because I agree, it is better to 
have good numbers. But what you just described is--and you did 
it much better than I did, so thank you--is exactly our 
strategy around foundational services. You focus on the things 
that Veterans really need us to be good at. So, absolutely, I 
agree with your description.
    The Chairman. The gentleman's time has expired.
    I would argue also that a VA primary care physician who has 
never served would not be as well prepared as a Veteran like 
myself, who is a military doctor who retired from the military, 
would understand also. So there are people on the outside who 
can provide those services. Like Dr. Wenstrup, myself, and 
others who have served in the military certainly understand 
those needs.
    Mr. Higgins, you are recognized for five minutes.
    Mr. Higgins. Thank you, Mr. Chairman. And I thank the 
Secretary for appearing today. I thank you for your continued 
dedicated leadership, sir. I will remind those present, 
including the media, and my colleagues that the Nation of 
American Veterans for 242 years have fought to establish and 
maintain a Nation of laws. A Nation where a man is considered 
innocent until proven guilty. And I would hope that we are not 
sliding towards a Nation of allegation and accusation.
    Regarding extended care facilities, sir. I see in the 
budget that there is a 66.7 increase request for grants for 
state extended care facilities, and a zero percent request for 
grants for Veteran cemeteries. There seems to be disconnect 
there.
    I am concerned about our Veterans, especially our aging 
Veteran population, as we attempt to provide for these Veterans 
who, in same cases, certainly our Vietnam Veterans, did not 
return to warmth and open arms from that Nation, from a Nation 
that they served at that time. And these are the same Veterans 
that are not cared for in the caregiver program, and they are 
approaching their golden years, their last years on this earth.
    So an extended care facility and a long-term care facility, 
I would think that we would at least seek to provide for our 
aging Veterans end of life period of dignity where they can be 
revered and visited by family in their community where they 
live. And I just see a disparity in budget, sir. Would you 
please address that?
    Mr. Shulkin. Yeah. Well, we did significantly increase the 
amount of funds available to the state homes where 50 percent 
of the Veterans are being cared for right now in the state 
homes. I met with all those directors this week, and they are 
extremely grateful for the support that we are providing for 
them to be able to do that work because the number of Veterans 
who are aging, of course, is increasing. On the cemeteries, we 
have, I think, it is a $334 million increase in the fiscal year 
2019 budget. Right?
    Mr. Sullivan. Sir, we do have a large increase in the 
fiscal year 2019 budget to address major construction and minor 
construction for national cemeteries. The grants program is a 
flag request, but that grants program amount is adequate for 
funding. Historically, the grants that are on the priority list 
that do have the matching funds and the assurances necessary to 
provide a grant award for the fiscal year.
    Mr. Higgins. So you feel that the funding that is in the 
fiscal year 2019 budget request is sufficient for states to 
perform at that level--
    Mr. Sullivan. Yes, sir, I do.
    Mr. Higgins [continued]. --for servicing an aging Veteran 
population that, obviously, the next stop from extended and 
long term care is a cemetery. And it would be our goal amongst 
this bipartisan Committee, it should be our goal as a Nation, 
to provide our Veterans with end of life dignity, and that 
would include appropriate services, military services, 
patriotic services, and to be buried amongst their Veteran 
brothers and sisters.
    Mr. Sullivan. Yes, sir, that is exactly the mission of the 
National Cemetery Administration. And we work with our state 
partners to operate this network of our 135 national cemeteries 
as well as 107 grant-funded state cemeteries to provide that 
national shrine for final resting places for our Nation's 
Veterans.
    Mr. Higgins. Thank you. That is an encouraging answer. 
Quickly, Mr. Secretary, VA witnesses have testified previously 
that non-institutional care settings are more cost effective 
than institutional care settings. This budget allocates $556 
million as a, quote, ``continued investment in non-
institutional settings.'' How exactly will this budget invest 
in non-institutional care settings?
    Mr. Shulkin. We are, as you know, I think this is exactly 
correct, that we believe that it is often better to allow 
people to remain in their home and look at alternatives, even 
things like adult day care, which we want to make easier for 
Veterans to get access to.
    But with the advances in technology like TeleHealth remote 
monitoring, our aids and attendants program, our home care 
visit programs, we have a package of services that is now a 
priority focus for us to make sure that we implement that. And 
we are supportive, as I know you are in our last discussion, 
about expanding caregivers to older Veterans. And we think that 
is an important piece of this as well.
    Mr. Higgins. Thank you. Mr. Chairman, my time has expired.
    The Chairman. I thank the gentleman for yielding.
    Ms. Kuster, you are recognized for five minutes.
    Ms. Kuster. Thank you. Thank you very much, Mr. Chairman. 
And welcome, Mr. Secretary, we are happy to have you with us, 
and I appreciate your comments at the top, and I do think it is 
important to restore confidence in our executive officials, and 
so I hope in the coming days you will be forthcoming with the 
American people.
    I want to turn to the issue of coordination of care and 
collaboration. Mr. Bilirakis and I will be introducing a 
bipartisan bill today that is a pilot project for integrating 
Veterans' care in our federally qualified health centers, 
FQHCs. And in my area where we have a rural northern part of 
the state, often the FQHC is the place that people can get 
access to care without traveling long distances. Could you 
comment on that issue or other collaborative ventures that the 
VA is getting into?
    Mr. Shulkin. Well, thank you for introducing that. I am not 
sure people recognize around the country just how important 
these federally qualified health care centers are. They do 
amazing work for a very vulnerable population. And I believe 
that as a large provider, or Federal health care services, that 
these organizations should look for the chance to collaborate 
more and to integrate in ways that we really have not in the 
past. So I think that a pilot program in that area would be 
very productive.
    Ms. Kuster. Excellent. Thank you very much. And we will 
look forward to working with your team on that as we go 
forward. I want to focus in on the leadership structure in the 
VA. You know we have had issues in New Hampshire around 
Manchester Veterans Hospital, we have learned of some very 
serious concerns in Bedford, Massachusetts, at the VA hospital. 
And my biggest concern is I do not see the VISN stepping in in 
an effective way when there are problems in our VA hospitals.
    Do you think we might have come to a time where we need to 
change this VISN organizational structure, and particularly 
with regard to hospital leadership and their report direct into 
your team as compared to a VISN that maybe is not sufficiently 
responsive?
    Mr. Shulkin. Well, first of all, I appreciate you sharing 
these concerns as you have. You have been a very strong 
advocate for getting this issue right. Our VISNs were 
introduced, the concept of VISNs, over 15 years ago. Yes, it is 
time to take a look at how modern health care system operates. 
And that is what we are doing in our modernization work.
    We have looked at large health systems like Kaiser, 
Ascension, Trinity that have multiple hospitals throughout 
large regions, and how they are organized, and we are looking 
at those best practices and seeing what we need to do. The 
basic strategy, though, is, we have to give the people running 
our facilities, our medical center directors, more authority 
and accountability to be responsible for the decisions. And we 
have to look at what then the role of the VISN is, and how that 
modernizes.
    Ms. Kuster. I appreciate that. And, again, look forward to 
working with your team on reviewing that structure as it--
particularly focusing in on hospitals where this has not been 
an effective--
    Mr. Shulkin. Yes.
    Ms. Kuster [continued]. --oversight structure. So I 
appreciate that. In my last minute-and-a-half, I would love to 
hear your thoughts on, it looks as though you have created a 
new account for the VA modernizing the electronic health 
records system, and I want to drill down a little bit.
    Is this new account, will it include funds to support and 
maintain the current VistA electronic health record during the 
modernization process or will these funds only be used on the 
adoption of an implementation of the Department of Defense 
electronic health record that we are adopting? If you could 
walk us through how those two things will be funded at the same 
time.
    Mr. Shulkin. Yeah. It has to be both. This is going to--in 
order to implement a new electronic medical record, we are 
going to have to invest in the infrastructure of our 
connectivity, of our servers to get ready to do that. We are 
going to have to undergo significant change management because 
when you implement the EHR it is about technology but only a 
little bit, this is about how you do business.
    So we are going to take 130 different systems and we are 
going to really be creating a single instance. That is a major 
change. It should create great efficiencies, improvements, and 
quality as well. And so we are going to be focused on 
maintaining VistA because we have 130 transitions to happen. So 
that is why over a ten year period of time, you are going to be 
running VistA up until that very last instance is turned over.
    Ms. Kuster. So my time is up, but I hope you will keep the 
Committee informed of your timeline and your progress as you go 
forward.
    Mr. Shulkin. Yes.
    Ms. Kuster. So, thank you, and I yield back.
    The Chairman. I thank the gentlelady for yielding.
    And just to comment about this, and I think we will get 
into this more as we go along. The distressing part for me when 
I was at Fairchild was, I am not sure you are ever going to 
be--as a long a current Veteran that is in the old, when you 
get to the new system that is fine, in the old system--you will 
ever be able to turn it completely off for 50 years. Because 
until the last of us die that are in that old system, there is 
no way to download all--there is so much information in the 
VistA system--they can't download all that information. So you 
have to have a way to look back to get information. I do not 
know how complicated that will be, but it is a major 
undertaking to do what they are doing.
    Mr. Banks, you are recognized.
    Mr. Banks. Thank you, Mr. Chairman. And thank you for being 
here, Secretary Shulkin. First and foremost, I am enormously 
proud of what we have accomplished in partnership with this 
administration. President Trump, under your leadership, this 
Committee, over the past 14 months, we have done a lot of great 
work for Veterans that we should be proud of. And I appreciate 
the seriousness that you have taken the IG report and 
addressing it, and I look forward to continuing to see you do 
that.
    To dive a little bit deeper into Ms. Kuster's question. I 
know that you agree that Veterans deserve a scheduling system 
that gives them immediate access to care, shortened wait times, 
the ability to track and manage information and progress 
throughout the care continuum. I want to make sure, though, 
that as we appropriate money and pass budgets that the money 
that we provide to the VA is effectively utilized, which is the 
reason that you are here today.
    And we have seen this past year that with the electronic 
health record roll out that has run into trouble, we have seen 
the delay of implementation even further. So my question is, 
with a readily available COTS, solution, and the appointment 
scheduling system, or MASS, program that can be deployed 
nationally in a two-year timeframe, what are your plans and 
timeline, to be a little more specific, to utilize funds you 
receive for IT improvements to pay for a full deployment that 
is not dependent on the stalled ten-year VA EHR rollout?
    Mr. Shulkin. Specifically on scheduling?
    Mr. Banks. Yes. IT.
    Mr. Shulkin. Yeah. Yeah. Yeah. The strategy that we are 
using now is to move towards COTS or off-the-shelf products, 
and there are plenty of good commercial systems that are out 
there. The MASS scheduling system is being implemented right 
now in Columbus, Ohio, and we look very much forward to seeing 
how that is working.
    That pilot is on track to be--do you remember the live date 
that that will go in Columbus?
    Mr. Rychalski. I do not, sir. I think it is March.
    Mr. Shulkin. Yeah. Yeah, it should be in the next few 
months that this goes live, and we are very much looking 
forward to seeing how that is working. We have some other COTS, 
products that are being tested in three other sites--I think 
Bedford is one of them--that we are very much looking forward 
to seeing how that is working as well.
    In the meantime, we have rolled out to right now it has 
gone to 35,000 different Veteran transactions an internal 
system called Veteran Scheduling Enhancement. But I think our 
plan is to go towards an off-the-shelf product.
    Mr. Banks. Okay. Thank you. Please keep us posted on that.
    Mr. Shulkin. Yes.
    Mr. Banks. Earlier this year, on a different subject, I was 
disconcerted when the VA considered taking funds from homeless 
program case managers and converted them into general purpose 
funds. I know you and I, and others on your team and I have 
talked about this. I appreciate the motives of wanting to 
provide flexibility to the VISN directors, but I do not believe 
that this should come at the cost of assisting the Veterans who 
are most in need. I know that you agree with that.
    Especially because if less Veterans find their footing into 
stable situations, we will be spending more money and not 
saving money. And for fiscal year 2019 it appears the VA 
intends to revisit this possibility once again by soliciting 
stakeholder input first, which is a healthy part of the 
process. So, if stakeholder input remains opposed to this 
change as it was overwhelmingly for fiscal year 2018, can you 
guarantee today that the VA will not go execute this change in 
homeless programs affecting fiscal year 2019?
    Mr. Shulkin. The mistake that we made was letting anybody 
think that we are taking the foot off the pedal on ending 
Veteran homelessness. We are not, we are laser focused on this, 
this is a commitment. We have $1.8 billion in the President's 
budget for ending Veterans homelessness.
    What we are trying to do, when you look at the data, as you 
know, Veterans homelessness actually went in the wrong 
direction last year, it went up 2 percent, but there were five 
specific cities that led to that increase. Two of them, which 
are Seattle and Los Angeles, were by far the overwhelming 
increase.
    We wanted to find a way to be able to use this $1.8 billion 
to focus on where the Veterans are having the most problems. We 
need stakeholder input, we need to do it thoughtfully before we 
make any changes. We do not want to have an unintended 
consequence of anything we are doing.
    So we have not decided to do anything until we have a 
chance to sit down, review it with you, review it with 
stakeholders, make sure that decisions made will be good 
decisions. So we are not going to do anything until it is a 
very thoughtful plan, but we do want to get the resources to 
where the Veterans are homeless.
    Mr. Banks. I appreciate that very much. I yield back.
    The Chairman. I thank the gentleman for yielding.
    I now recognize Vice-Chair of the Committee Mr. Bilirakis 
for five minutes.
    Mr. Bilirakis. Thank you, Mr. Chairman, I appreciate it. 
Thank you, Mr. Secretary, for being here and testifying. I have 
a few questions. The VA's fiscal year 2019 budget request is 
$8.6 billion for Veterans, for mental health services.
    Part of this funding counts for critical one year period 
following uniform service and transition to civilian life. My 
colleagues and I on the Committee have had multiple hearings 
and roundtables, one just the other day, on the transition 
assistance process. Can you specifically tell me what the 
Department is doing to assist in this transition in the 
upcoming year?
    Mr. Shulkin. Yeah. First thing that we are doing, we have 
taken a look at this TAPS program, this transition program, and 
recognize that we could be doing it a lot better. This is a 
shared responsibility with the Department of Defense.
    Our Veterans' experience office has really looked at this 
and made a number of recommendations that we are working 
through with the Department of Defense to make that a better 
program. And I think changes already have taken place that have 
made it a better program.
    We need to pre-enroll our Veterans in their benefits so 
that they know they have them when they leave instead of 
wondering and going through a lengthy process after they leave, 
wondering how they get access to benefits. That is our biggest 
issue, to make sure people know these services are there for 
them, make it easy for them, essentially an auto-enrollment 
process so that there is no work to be done.
    Mr. Bilirakis. Okay. Thank you. Next question has to do 
with the Blue Water Navy Veterans. The VA budget seeks $2.9 
billion for Veterans' benefits including disability 
compensation benefits, programs for 4.5 million Veterans, and 
600,000 survivors. As you know, certain Veterans such as the 
Blue Water Navy Veterans are excluded from these benefits. 
While you have said in the past that these Veterans should not 
be waiting any longer, that is a quote, I want to know if the 
VA has any plans to reexamine this in the upcoming year. If 
not, why not?
    Mr. Shulkin. Congressman, the problem is, there is not much 
to reexamine. There is not data there that we can go back. I 
have tried every which way to see if we could find ships, and 
do microscopic analyses, or do new studies. There is not going 
to be new studies. This is about our obligation to those who 
have served. And to simply keep on passing the buck on this and 
not honoring this country's obligation to our Veterans I do not 
think is morally the right thing to do.
    So I am committed to working with you, and I know the 
Chairman feels the same way, to try to find a way to honor our 
obligation to these Veterans. And we are working now to have 
discussions with the Administration to work with Congress. We 
need to find those offsets, we need to find a way to do this. 
So I believe it is morally and ethically the right thing to do 
because there is not going to be scientific data, 
unfortunately, 40, 50 years later to be able to rely upon.
    Mr. Bilirakis. So you would consider this as a top 
priority?
    Mr. Shulkin. I think we have to do this, and I think we 
have to find the offsets to be able to go ahead and to resolve 
this issue. They have waited too long.
    Mr. Bilirakis. Yeah. The Chairman has found the offsets and 
I know he wants to proceed--
    Mr. Shulkin. Good.
    Mr. Bilirakis [continued]. --so hopefully we can get this 
done--
    Mr. Shulkin. Yes.
    Mr. Bilirakis [continued]. --very soon.
    Mr. Shulkin. Thank you.
    Mr. Bilirakis. Like you said, they can't wait any longer.
    Mr. Shulkin. Thank you.
    Mr. Bilirakis. Appreciate it. Question three has to do with 
the burn pits. The fiscal year 2019 VA budget requests $727 
million for direct research, a 14 percent increase over the 
fiscal year 2018 levels. One of my priorities in this Committee 
is to examine efforts to improve research and treatment for 
Veterans who may be experiencing negative health effects due to 
toxic exposure such as burn pit inhalation during their 
military service. I know it is a priority for a lot of Members 
here on the Committee, both on the Republican side and the 
Democrat side. What is the VA doing to further this goal?
    Mr. Shulkin. Yeah. I am trying to see. I do not know the 
answer to that question. Mark, do you?
    Mr. Yow. Can we take it for the record?
    Mr. Shulkin. Can we get back to you on that? I agree with 
you, we--
    Mr. Bilirakis. Please do.
    Mr. Shulkin [continued]. --should, yes.
    Mr. Bilirakis. Thank you. Well, I have got 20 seconds. I 
guess I will yield them back, Mr. Chairman, and I will submit 
the rest of the questions. Thank you very much. I appreciate 
it.
    The Chairman. I thank the gentleman.
    Ms. Esty, you are recognized for five minutes.
    Ms. Esty. Thank you, Mr. Chairman. And thank you, Mr. 
Secretary, and thank you for taking the time to meet with us 
yesterday. I think it is really important that we keep open 
lines of communication.
    We are here today to talk about we can better deliver care 
for Veterans and their families. And I know we have a shared 
goal around that, but we in Congress have a responsibility to 
make sure that those tax payer funds are wisely spent, and 
properly spent in service of all of that. And I do appreciate 
your willingness to speak with us on the IG's report, and we 
will deal with that at another time.
    I do want to associate myself with the remarks of the good 
gentleman, Bilirakis, burn pits and Blue Water Veterans are 
very big issues in my district, have legislation on both of 
those bills, and we are looking forward to passing up. And the 
one other issue I want to flag is what we discussed at 
breakfast yesterday, is really rethinking a little bit on the 
disability/ability issue. What can we do for more temporary 
disability status in order to able our Veterans to get back and 
fully participate in the economy? And I think that is something 
I hope we pursue and figure out a way to do that.
    I want to focus with our time here, and I am reserving, Mr. 
Chairman, 30 seconds for my friend, the gentleman from 
Minnesota, my former district in Minnesota 1, for 30 seconds at 
the end. So I will keep track of time here.
    I want to turn to the appeals modernization efforts and 
what we talked about over the last, you know, last several 
months. Looking at as the appeals modernization is enacted and 
RAMP expands into new VA regional offices, do you feel that the 
proposed fiscal year 2019 budget will appropriately handle the 
continued focus on completing pending legacy appeals? We have a 
lot of concerns on legacy appeals.
    Mr. Shulkin. Yeah, I do. I think that we are adding 605 
FTEs to the appeals process, we are hoping that in fiscal year 
2019 we have as much as 25 percent that are going into the RAMP 
process. The numbers are extraordinary. Of the 680 Veterans 
that have chosen the RAMP process electively, they have gotten 
an answer in 38 days versus over a thousand days in the 
traditional process. So working with our VSOs and working with 
you in outreach efforts, we hope to make people aware of this 
as an option because we want them to get these resolved 
quickly.
    Ms. Esty. We are encouraged by the drive to reduce 
redundancy of self-reporting income status, because we know 
this has been an issue on the claw back for pension benefits. 
As I understand it, income information will be provided by the 
Social Security Administration, IRS, what systems will be in 
place to ensure that reporting errors are not taking place in 
that communication?
    Mr. Shulkin. Jamie, do you know on the reporting errors?
    Mr. Manker. So I will have to get back to you on that--
    Ms. Esty. Okay.
    Mr. Manker [continued]. --with what checks and balances we 
have in place.
    Ms. Esty. Okay. I would like to turn now to a follow-up on 
the caregivers hearing from last week. You proposed limiting an 
expansion of the VA program of comprehensive assistance for 
family caregivers to only those who fall into Tier III, the 
most severally ill or injured Veterans. Can you clarify--
because I have to say there was some disagreement within the 
press and those in the room in understanding what you meant by 
that limitation--whether your recommendation is to maintain the 
current eligibility criteria for post-911 Veterans and expand 
only to pre-911 in Tier III, or if the program post-expansion 
would be only limited to Veterans in Tier III from then on, 
whether their service was pre-911 or post-911?
    Mr. Shulkin. Yeah. No. Thank you. First of all, this is, of 
course, your decision, I am giving you my advice on this in 
terms of using our resources most effectively. My 
recommendation would be that everyone who currently has the 
program should be grandfathered under the current rules. I do 
not think it is fair to award somebody a support and then 
change the rules on them after you have started the process.
    So for our 27,000 that are currently in the program, I 
would not recommend changing that. But going forward, if there 
is a decision to expand eligibility, I believe you should pick 
a standard that is used by other professional standards today, 
which would be equivalent to a Tier III; three ADLs plus 
cognitive dysfunction.
    Ms. Esty. Thank you.
    The Chairman. Okay. The gentlelady--
    Ms. Esty. I yield back, which did not--
    The Chairman. The gentlelady's time has expired. Let's see.
    I think, General Bergman, you are up, five minutes.
    Mr. Bergman. Thank you, Mr. Chairman. And thanks, Dr. 
Shulkin, and all the rest of you for being here. I know I had 
to step out to a different event here for a while, and I know 
that my colleague Dr. Wenstrup asked questions about VA 
facilities.
    In the reinvestment of the dollars that you are getting 
from closing or shutting down unused space, can you track on a 
short term basis and then a long term projection as to exactly 
how you are going to reinvest the dollars that you save from 
not maintaining a space open that is not being used?
    Mr. Shulkin. Yes. Yes, we will be able to do that. 
Currently today when we dispose of a property, sometimes very 
large properties like in Pittsburgh or in New Orleans we 
disposed of the whole site that we had lost in Katrina, we give 
that back, not to the VA, we give that back to GSA or the 
General Treasury. Under the President's infrastructure program 
that he announced on Monday, in there would be a proposal that 
VA could retain those proceeds if we were to give back 
property, and we would track that very specifically and they 
would be reinvested in infrastructure in the VA.
    Mr. Bergman. So if we looked at the inventory, if you will, 
of facilities whether they are not being used at all or whether 
they have just--you know they are phased out because of new 
building in that particular area, could we do a, if you will, a 
multiple listing, you know, like you see in real estate that as 
the VA, here is what we have in our inventory across the 
country, and here is what is for sale, if you will?
    Mr. Shulkin. Yeah. Yeah. I think that is a great way to do 
it. We have been handling them individually by local markets, 
but I think we could put--
    Mr. Bergman. Well, and the reason I asked the question is 
because I have been involved for decades in BRAC. I know 
sometimes people get scared when you use that term, but I have 
been on both sides of that equation whether it be arguing for 
the base staying open or arguing for something being 
repurposed, and we have had some really outstanding examples of 
how to do it over the course of the last 40 or 50 years. But it 
takes an informed partnership between those trying to dispose 
of the facilities and those within a local community, or 
whoever, who might want to use that. So I look forward to you 
continuing to developing that and also providing that 
availability for those of us who want to see how it is going, 
what does the market look like, if you will, what is the fair 
market.
    Different subject. In your pamphlet here, and we talked a 
little bit about this yesterday, the addition of full-time 
equivalents to handle new tasks, bringing people up and online. 
Is there an alternative, rather than just adding full-time 
people, and specific to the appeals process? We know that there 
is probably a RAMP where you have a peak, and then if we do it 
right, it is going to drop off. You know, that is just the way 
it is.
    Mr. Shulkin. Yeah.
    Mr. Bergman. Do we really need to add the full-time 
equivalents to the point where will they be up to speed in what 
they are doing in time for that peak, or, you know, have we got 
things synced up?
    Mr. Manker. Yes, sir. So we are taking multi-pronged 
approach to getting our FTE up and available for processing 
claims when the law is fully enacted. What we are doing is we 
are using a program called WARTAC where we recruit military 
members as they are transitioning from service to civilian 
life, and teaching them to be claims processors and appeals 
processors.
    Mr. Bergman. So what do we do after the peak has passed? 
What is their job after the peak? Because we have an X-number 
of Veterans--
    Mr. Manker. Yes, sir.
    Mr. Bergman [continued]. --that are going to be applying, 
and there is going to be a spike.
    Mr. Manker. Sure.
    Mr. Bergman. What do we do with that full-time equivalent 
after that peak has passed and now--
    Mr. Manker. That is a great question, and how I would 
respond to that is, we experience about 55 FTE per pay period 
in attrition, so I think natural attrition will take care of 
the issue of the additional FTE that we have in the books.
    Mr. Bergman. Okay. Well, thank you. We, as a Committee, 
there are no easy decisions here. You know that, we know that. 
And the point is as a Committee to work together with all of 
you, we hold each other accountable up here, we know that you 
do the same, the question that we all have is how do we do that 
together? And I yield back, sir.
    The Chairman. I thank the gentleman for yielding.
    Ms. Radewagen, you are recognized for five minutes.
    Ms. Radewagen. I thank you, Mr. Chairman and Ranking 
Member, for holding this hearing today. Thank you, Secretary 
Shulkin, and your team for coming in early to answer our 
questions. It is always a pleasure to see you. Thank you again 
for yesterday's meeting, it was very useful.
    My home district of American Samoa consistently boasts one 
of the highest rates of recruitment in the Nation, and, of 
course, I never get tired of emphasizing this fact, and I am 
extremely proud of and thankful for our island's Veterans.
    Unfortunately, this increased enlistment means a 
disproportionate amount of our community suffers from PTSD and 
mental health issues associated with service. I have friends, 
neighbors, and close relatives who bear these invisible wounds. 
And while it would be a great dishonor to characterize these 
brave soldiers as victims, it would be an even greater dishonor 
to lapse in our obligation to provide them with the care 
required for their complex and often misunderstood mental 
health issues.
    Mr. Secretary, several different charts and figures have 
come across my desk, and I hope you can help me interpret some 
contradicting figures. Could you please clarify whether or not 
the budget proposal requests more or less funding for medical 
research compared to the 2018 request? And how much research 
funding do you hope to dedicate to mental health research?
    Mr. Shulkin. Yeah. Our research request in the 2019 budget 
is $727 million. That is an increase, a small increase, but it 
is an increase from the fiscal year 2018. In addition to that, 
we have about $1.1 billion of external grants. Some of them 
Government grants, some of them commercial grants. So together 
it is about a $2 billion budget for research.
    Mental health is one our key areas of focus, this is 
critical. I do not have the exact number. Mark, do you have the 
number for mental health and research?
    Mr. Yow. Not for mental health, sir. But the actual 
increase to the appropriation goes from $640 million in 2018 to 
$727 million in 2019.
    Mr. Shulkin. Yeah.
    Mr. Yow. So it is an $87 million increase.
    Mr. Shulkin. Yeah.
    Mr. Yow. But we can get the number from Mental Health.
    Ms. Radewagen. My staff and I have had meetings with 
companies and groups who are interested in working with VA to 
do PTSD and mental health research. What role do public or 
private partnerships play in maximizing VA's use of their 
budget, especially regarding research and developing mental 
health care?
    Mr. Shulkin. We need to be doing more of that. There are, 
you know, the advances in science and technology are absolutely 
incredible. So you take our $727 million that we are proposing 
for research and you match it with the $1.1 billion of Federal 
and commercial grants, and now you have a very substantial 
amount of research dedicated all to the health of Veterans. But 
we need to be doing more of that, and we need to be working 
with the private sector, and reaching out more to see what is 
out there that could help, particularly with PTSD and mental 
health issues.
    Ms. Radewagen. Thank you. Mr. Chairman, I yield back the 
balance of my time.
    The Chairman. I thank the gentlelady for yielding.
    I now yield to Chairman Arrington for five minutes.
    Mr. Arrington. Thank you, Mr. Chairman. And,
    Mr. Secretary, thank you for being here along with your 
team. I want to focus on the stewardship aspect of research, 
with $12 billion additional funds to deliver for our Veterans 
on behalf of the tax payers. And as somebody who has helped run 
a government agency, I know the challenges you face, but it is 
imperative that you are able to manage your assets, and the 
most important of your assets are your people, for any 
organization. How many people will this $12 billion translate 
into, new people?
    Mr. Shulkin. Yeah. I believe that our budget prior to the 
budget caps deal was an incremental 6,200 people. But it may be 
more now that there have been additional funds allocated.
    Mr. Arrington. Okay. Sixty-two hundred additional--
    Mr. Shulkin. Additional.
    Mr. Arrington [continued]. --employees at the VA, and that 
brings the total number of employees in the VA enterprise to?
    Mr. Shulkin. Like 373,000.
    The Chairman. Is that your biggest budget expense?
    Mr. Shulkin. Sure.
    Mr. Arrington. Okay. So we got to get this right.
    Mr. Shulkin. Absolutely.
    The Chairman. And I must say that my initial introduction 
to the VA was frustrating with respect to managing people for 
performance and achieving the desired outcomes. Accountability 
would be at the core of that, and that is a challenge in any 
organization, but in Government especially. Bureaucracy, civil 
service roles, unions, I mean, how do you do this?
    Well, under the leadership of Chairman Roe, and Ranking 
Member Walz, and the bipartisan efforts, we gave you the 
accountability tools, or at least some accountability tools, 
some new authority and flexibility. How is that going? How are 
you exercising it? Do you need more?
    Mr. Shulkin. Well, first of all, thank you for giving us 
that authority. Since we have opened up the Office of 
Accountability and Whistleblower Protection, 1,300 employees 
have been removed in the last eight months. We do not have a 
target or goal for that, it is not our objective to reach that. 
But our objective to make sure that we are doing the job that 
we are doing and everybody understands that they serve Veterans 
is doing that job. And so we are focused on that, it is going 
to--
    Mr. Arrington. Can you tell the difference? Do you feel a 
shift in the culture with these new tools, set of tools?
    Mr. Shulkin. You know, I think that one of the things that 
you learn when you run an organization as big as VA, there is a 
different culture at each VA. And I think that there is a lot 
of work to do at some VAs that still remains, and there are 
others that clearly have used this to improve and that is 
noticeable, but it is not yet noticeable at all of our 
facilities.
    Mr. Arrington. In this same vein, and I am so grateful to 
work with Ranking Member O'Rourke and our Subcommittee, and I 
am delighted that we have been able to achieve a lot of 
bipartisan work. Probably the most productive Committee in 
Congress. Thirty-five bills passing the House, twelve have 
become law. I mean, so I think we have got a great team, 
including the President, pushing on this. And he is fighting 
for our Veterans as are my colleagues.
    This is the biggest point of frustration for me with 
respect to managing our people and getting that right. My first 
hearing we got a report from the GAO that there were hundreds 
of VA employees who were union members, who spent a hundred 
percent of their time on union activity; a hundred percent.
    Now there could have been more because the tracking was 
terrible, and we have been asking for data since the 1970s, but 
the people back in West Texas, and my Veterans, 40,000 in 29 
rural counties, they find it outrageous that somebody would 
spend a hundred percent of their time on something other than 
the job they were hired to do. Could you please tell me how you 
feel about that? I have got a bill, what could we do to help 
you? Is that a challenge in changing the culture and managing 
your assets? And after this answer, I yield back, Mr. Chairman.
    Mr. Shulkin. Okay. Thank you. I come from the private 
sector, I have run institutions with very, very large unions, 
and I have not seen that before. Where the time that is spent 
on union time is usually supported by the union dues and the 
union itself. I do believe that our unions are productive 
partners with us, and I do really appreciate the collaboration 
that we have because I believe that they care about getting the 
right services to Veterans.
    But I do believe that the time spent, that the Government 
pays for, its employees should be to serve Veterans in direct 
Veteran services. This is not an anti-union position, I believe 
very strongly we need to work with them, but I believe that we 
should be looking at alternative ways to make sure union 
activity and direct Veteran care are separated.
    The Chairman. I thank the gentleman for yielding.
    Dr. Dunn, you are recognized for five minutes.
    Mr. Dunn. Thank you very much, Mr. Chair, and thank you, 
Mr. Secretary. I am going to change focus a little bit. You 
have requested a major construction increase of $1.13 billion, 
the largest element of that is a $400 million seismic 
correction fund.
    Mr. Shulkin. Yes.
    Mr. Dunn. Your suggested appropriations language stipulates 
that the fund be available regardless of the estimated cost of 
the project, that is regardless. So what does that mean 
exactly?
    Mr. Shulkin. Yeah. I think you are right in asking that 
question. I am not sure what that means. Are you familiar with 
that? Because $400 million should be $400 million, you do not 
want to have it go for--
    Mr. Dunn. I am reading that and I am thinking slush fund.
    Mr. Shulkin. Yeah.
    Mr. Rychalski. Right. I do not think that was the intent. 
But, frankly, that is a good question, I would have to come 
back to you with an answer. I do not know what the language 
means--
    Mr. Dunn. Let's visit that again before the final. In the 
past, the GAO has raised concerns about the VA employees gaming 
the capital projects ranking system, or SCIP, by improperly 
coding projects as seismic corrections. I would like to be 
assured that these requested seismic fund projects are truly to 
harden buildings that are in earthquake zones. Can you give me 
that assurance?
    Mr. Shulkin. Yeah. Yeah. I do know--Mark, are you familiar 
with the ratings on the SCIP process? I do know when I took a 
look at this last time I was concerned about the same thing, 
how highly prioritized the seismic issues were, and I was 
afraid that if you were not in that part of the country you 
were not going to get any of our funding.
    We did change the prioritization of the seismic, but this 
is the first time that we have been able to really start 
substantially dealing with some of these seismic issues that 
are decades old in deficiencies. But in terms of these 
projects, I know the specific projects that the $400 million 
are going for, I do not believe--I believe that they are truly 
are for seismic improvement.
    Mr. Dunn. I actually have, you know, we all have the, you 
know, the appendix that lists some of these seismic projects in 
Arkansas, Illinois, South Carolina, not famous--
    Mr. Shulkin. Yeah.
    Mr. Dunn [continued]. --earthquake zones. Forty-four states 
are involved in the shopping list of seismic correction 
projects, plus D.C. and Puerto Rico. Puerto Rico no doubt needs 
some rebuilding, I do not think it is seismic, I think it is 
hurricane related. I would like to be assured that these 
requested projects and on the wish list, a long wish list, $7.6 
billion worth of seismic corrections--Wisconsin and Louisiana 
are in this list--that, you know, these are truly for seismic 
projects.
    Mr. Shulkin. Yeah.
    Mr. Dunn. I am concerned about that.
    Mr. Shulkin. I think you have raised several good issues 
about the language in which it said, and also about the 
criteria. We will, if it is okay, get back to you and sit down 
with you.
    Mr. Dunn. Okay. Let me leave you with a thought. I was 
reading through the GAO report and it says, ``Even though''--
this is a quote out of the handouts here--so, ``Even though 
some facility-level planning officials told us they did not 
think these demolition projects would score high enough to get 
funding, officials who oversee this SCIP process told us it was 
possible that if the project's narratives linked backed to 
priority areas such as seismic corrections that they might get 
priority that they otherwise would not.'' So, you know, it is a 
narrative that causes concern for misleading the oversight 
Committee.
    Mr. Shulkin. Yeah.
    Mr. Dunn. With that, I yield back, Mr. Chairman.
    The Chairman. I thank the gentleman for yielding.
    And I would mention on the seismic issues. A little over 
200 years ago there was an earthquake in the West Tennessee 
area along the New Madrid fault where the Mississippi River 
backed up, that is how some of our lakes were formed there, and 
church bells rang in Philadelphia from this. So there are needs 
along the Mississippi River you might not be aware of. One of 
the largest earthquake faults in the country is there.
    And, Mr. Poliquin, I recognize you for five minutes.
    Mr. Poliquin. Thank you, Mr. Chairman, I appreciate it. 
Thank you, Mr. Shulkin, for being here, and thank you for your 
staff to be here. I know, Mr. Shulkin, that the Chairman put 
this graph up here earlier--
    Mr. Shulkin. Yep.
    Mr. Poliquin [continued]. --and it is really important, I 
think, for everyone to see. We are in the business of caring 
for our Veterans, and if I am not mistaken, I would like you to 
confirm this, Doctor, when we have the WWII folks and the Korea 
folks that are now moving on, the population of our Veterans 
that we are responsible for caring for is dropping, but at the 
same time I know a lot of our young men and women coming back 
from the Middle East are gravely injured, and hurt, and need to 
be cared for, and I understand all this.
    But what I am looking at is a budget that has grown 
dramatically over the last five or ten years--pick the period--
greatly outpacing the growth of the total Federal government, 
greatly outpacing the growth of our economy. And so the point I 
want to make, why I am holding it up so long, is when you have 
an economy that is growing at X and a department that is 
growing at, I do not know, six times X, whatever it is, five 
times X, is that it is not sustainable.
    And I would also like to remind you, Mr. Secretary--and I 
know you know this because we talked about this yesterday--is 
that our Federal government is horribly in debt; horribly in 
debt. Twenty-one trillion dollars to be exact, or almost 
twenty-one trillion dollars. You know, with interest rates 
rising and the economy picking up, there is going to be more 
and more pressure on interest rates. So the debt service 
requirements, the interest on that debt is just going to 
continue to go up.
    So my question to you is this. You are coming back to us 
asking for another $12 billion in a budget that has gone up 
dramatically, continues to go up dramatically, greatly 
outpacing the growth of the rest of the Federal government and 
the economy, it is clearly not sustainable. So could you, 
please, just in a nutshell, tell us, Mr. Shulkin, what are the 
two or three top drivers that is causing this to happen, and 
why you have to come back to us every year asking for, in this 
case, another $12 billion?
    Mr. Shulkin. Yeah. Well, Congressman, I share your exact 
concern. I think you said this correct, it is why we produced 
that graph. That we cannot continue to do business as usual, 
that this will eventually lead to us not being able to support 
our country's Veterans, which would be a great error and lapse 
of our responsibility. So we have to do things differently.
    We are dealing with problems that have been essentially 
neglected in the VA for decades; putting in a financial 
management system that still runs on COBOL programming; running 
138 different versions of an electronic health record that is 
35 years old that we are putting all of our money just to 
maintain it; dealing with old hiring practices and not having 
the right accountability in the past.
    So what we are doing is we are doing everything we can, 
this investment, to change that. To bring us modernized 
systems, to decrease the rate of increase. And my whole team 
knows that is our goal, to bend the cost curve because we 
cannot have another graph like that for another five or ten 
years.
    So the drivers are Vietnam Veterans age 67 now on average, 
getting older, requiring more services. You have talked about 
people that continue to return with significant needs. Our 
mandatory benefits rising at huge growth rates, our Veterans 
have earned those benefits but we have to make sure that our 
benefits are designed to help people return to well-
functioning, well-being.
    Mr. Poliquin. Well, I am glad you mentioned that, Mr. 
Secretary, because I believe, and correct me if I am mistaken, 
the goal is when a Veteran comes to us with a malady is to get 
them better--
    Mr. Shulkin. Yes.
    Mr. Poliquin [continued]. --and have them become 
independent and okay. Would you cite for us what we talked 
about yesterday at breakfast about sleep apnea versus someone 
that comes in who is an amputee, and go down that path because 
I think it would be important to get out there?
    Mr. Shulkin. Yeah. Yeah. What we are doing is we started a 
process six or seven years ago which is to re-look at all of 
our body systems. We are now in the process of looking at 
issues like sleep apnea. Sleep apnea has a 50 percent service-
connection with it. We are spending billions of dollars on 
that.
    Fortunately, medical advancements have helped us in being 
able to treat this condition. We need to diagnose it properly, 
treat it, manage it, and then people can go on with their lives 
in a normal, healthy, functioning way. And we want people to 
get that treatment that is our goal at VA to get the right 
treatment.
    But once we get people back and being able to function in 
the way that they should with adequate treatment, there should 
be a recognition of that in our benefits program. And so we are 
going through this process, we work with our VSOs through this 
process, it has been going on. But we believe a good system 
like this needs to evolve and change as science changes.
    Mr. Poliquin. Mr. Chairman, I know my time is up, but 
please may I have just a few more seconds to ask a question 
that is imperative to the staff?
    The Chairman. (Indiscernible) just a few more seconds.
    Mr. Poliquin. Thank you. I know that was lean yes. Mr. 
Secretary, you requested $25 million this year to reimburse the 
judgment fund for construction claims and settlements. Will 
this zero out the VA's liability to the judgment fund?
    Mr. Shulkin. Anybody know? We have to get back to you on 
that.
    Mr. Poliquin. I am glad, Mr. Chairman, you gave me the time 
to ask the question, thank you.
    The Chairman. The gentleman's time has expired.
    I will now, having no further Members here, I will yield to 
Mr. Walz for any closing statements.
    Mr. Walz. I yield one minute to the gentleman from Texas, 
Mr. O'Rourke.
    Mr. O'Rourke. Thank you, Ranking Member Walz. And very 
quickly, I had asked you for total outstanding mental health 
hires, vacancies. Your staff got back to us, said it is 2,912.
    Mr. Shulkin. Yes.
    Mr. O'Rourke. I would also ask for all outstanding primary 
care hires. They gave us a number that is in the hundreds, so I 
probably did not ask the question the right way. Apart from 
mental health, I want to know how many outstanding primary care 
provider hires there are.
    Mr. Shulkin. Yeah.
    Mr. O'Rourke. Many of us are getting questions at our town 
halls; my primary care provider is gone, I have not been 
reassigned, I do not know who to go to. So I want to know what 
the outstanding number is. Would you get that to me and the 
Members of the Committee?
    Mr. Shulkin. Yeah. I was handed probably what you were, 
which says in primary care 270, but it seems small.
    Mr. O'Rourke. It has got to be a lot higher?
    Mr. Shulkin. It has got to be higher, yeah.
    The Chairman. And then last point, I will yield back, Mr. 
Chairman. I think inadvertently my colleague
    Mr. Arrington and the Secretary conflated two distinct 
terms; official time and union activity.
    Mr. Arrington. Correct.
    Mr. O'Rourke. If someone is performing a hundred percent of 
their job on official time, that is one thing--and we can have 
a reasonable debate on that and come to different conclusions--
that is not union time, and I think you misspoke earlier.
    Mr. Shulkin. Okay.
    Mr. O'Rourke. I would like you to just, for the record, 
share that you intended to say official time not union time. No 
one is allowed to spend a hundred percent of their work day on 
union time.
    Mr. Shulkin. Thank you for clarifying that.
    Mr. Walz. I thank the gentleman, and thank you for being 
here, Mr. Chairman. And I want to be absolutely clear. What 
distinguishes this Committee I think from any other, and I it 
has been noted, is our ability to focus together on the issues 
that matter. I am glad there was a lot of press here today, I 
hope they were here for the budget.
    Mr. Shulkin. I am sure.
    Mr. Walz. I think all of us know what that is, and that is 
a fair thing. And I want to be very clear, no one is not taking 
those things very seriously. We have had those conversations, I 
have indicated, it appears like there have been allegations of 
criminal contact on both sides of these things, those things 
need to be found out. I am grateful for you in the decision to 
reimburse the Federal Government and move on.
    I would note that the reason this Committee works is 
because we have chosen collectively here not to allow partisan 
natures to get in this. Your predecessor sat in that chair and 
took an awful lot of grilling because he was a Democratic 
President's nominee that was there. You have the unique 
position of being someone who spans both of those. So I hope 
everyone here understands that that is what we are focusing.
    And I also would like to do of clarify one thing because 
this one does get into--I am a little bit miffed by on it. I 
have sat on this Committee longer than anyone else. I have 
carried the Blue Water Navy bill, this has been a passion of 
me. I was there with the Nehmer claims, I was there with 
Parkinson's.
    My disagreement is not about getting this done, or the 
commitment of doing this. My disagreement is we should not be 
asking one group of wounded warriors to pay for another. My 
suggestions are to ask for a one-tenth of one percent off the 
tax cuts to the top tax bracket. Or I even suggested, somewhat 
facetiously but maybe not, that if you got a deferment to 
Vietnam you could help pay for the ones who were there.
    So I want to be very clear. No one disagrees up here, the 
Chairman's commitment to fixing Blue Water Navy is second to 
nobody in this country. He is doing Yeoman's work of trying to 
find these things. And by presenting that, I do not take 
offense to that. I simply disagree with how we are doing it, he 
brings up a valid point.
    I hope from the perspective of where you are at, we are all 
committed to getting this right, we are trying to find it. I 
understand the commitment to use the COLA round down. I think 
there is valid arguments on that, but they are not coming from 
a position that we do not care about getting it done. So I just 
want to make clear on that.
    Mr. Shulkin. Thank you.
    Mr. Walz. I would note that the accountability act. Again, 
30 percent of the people removed come from food service and 
laundry. Just as a thought of where we are going. Perhaps 
training on that end.
    Mr. Shulkin. Yeah.
    Mr. Walz. Perhaps new employees that are there. Perhaps we 
are quick to move people before we get them in. I believe 
strongly in accountability because I was there to help graph 
this. But my intention was not to get rid of housekeepers if 
these are things that can be corrected with training, and HR, 
and management, if you will.
    I thank the gentleman for clarifying the position on 
official time. Really important clarification. We get that 
wrong, there is a lot of--I understand some tensions around 
this, but now we are back to the work of a budget.
    Again, I am grateful. The President sent down a budget, the 
Constitution is very clear on this, that we appreciate his 
suggestion. Congress' job is to write the budgets. Congress' 
job is to find that out with the input from trusted and folks 
who have to deliver that.
    I think there is a lot of commonality in getting there. I 
think the issue on budget growth, we do need to have that 
conversation, though, because, once again, I do not disagree. 
Management practices, all of that. We do have to acknowledge, 
though, I would argue the VA, especially the clinical folks, 
are doing such a fantastic job, we have added 2.5 million 
Veterans who come to the VA and want to get their care there. 
That is it. Vietnam Veterans are going through the, you know, 
the rabbit through the python thing, that we have them there, 
there are other things at work.
    And I would close with this. If you go to war there is a 
cost that does not end with the last bullet. And we have been 
at war for 16 years, we have asked people to go, we are going 
to have to budget for that. And, yes, it has to, if it does not 
become sustainable, but this is one that I do not see that this 
is an option or a discretional funding, this is an absolute 
mandatory requirement to care for our Veterans and we are going 
to have to budget accordingly.
    So, again, I thank the Chairman for his leadership. I thank 
you, Mr. Secretary, for being here in the midst of a lot of 
chaos and focusing on Veterans. And I yield back.
    The Chairman. I thank the gentleman for yielding.
    And I thank the panel for being here today and starting the 
discussion of the 2019 budget. And, you know, I was sitting 
here thinking, as we close, about--for our folks that are 
watching this--just what are the services that VA actually 
provides?
    And I have been here now nine going on ten years, and 
basically it provides quality health care for over 9 million 
Veterans. And whether it is inside the VA or outside the VA. 
Their commitment is to provide quality care wherever the 
Veteran gets that care.
    It provides memorial benefits--we talked about that 
earlier--to over 140,000 Veterans a year who have now passed 
and those benefits to them and their families. Pension 
benefits. Hundreds of thousands of Veterans get pension 
benefits. Group life insurance, we do not think about that, at 
6 million.
    Home loans. Veterans, now I think over 3 million get a home 
loan from the VA. Compensation benefits over, what, 4 to 5 
million of our Veterans get the--a huge benefit, the 
educational benefits. Both the Montgomery GI bill, the post-9/
11, and now the Forever GI bill. That Veterans are able now, 
and half, I think, of the young men and women who separate from 
the military use that GI bill benefit. One is sitting in this 
chair who used that GI bill benefit.
    And I want to thank the President for his focus on the VA. 
I remember sitting up at night and late in the evening when he 
gave his acceptance speech, and one of the first things out his 
mouth was his commitment to the Nation's Veterans. And I very 
much appreciate that, and I do not think it stopped. Every time 
he talks about--gives a speech, he mentions our Nation's 
heroes. And I thank him for that.
    We have a huge--this Committee, in a bipartisan way, as the 
Ranking Member mentioned, has got a huge amount of work to do 
this year. We have transition of the Choice program, we have 
got to get that done so you can move on with that. We have got 
the asset review to get the VA right-sized, to begin to go down 
a pathway of more efficient care in the neighborhoods, in the 
communities where our Veterans live.
    We have got EHR modernization that is starting. We have got 
appeals reform that we are just now--we have talked about that 
just a little this morning. As Mr. Walz brought up, one of my 
passions that I want to get off the table is our Blue Water 
Navy friends. I want to get that solved.
    We have got caregivers, we are moving forward with that. By 
the 7th of March we have our first roundtable on that. Estate 
VeteransState veterans homes were mentioned. I think those are 
tremendous. Everywhere I have been I looked estate Veteran at 
state veteran homes. Those are really quality places our older 
Veterans can go.
    You mentioned as your number one health priority, suicide 
prevention. We have got enormous work to do on that, and there 
is a huge investment in this budget for reducing the amount of 
suicide we have in this country.
    And, lastly, I know we always--a privatization comes up, it 
is hard to do that with a straight face. In the nine years I 
have been here, there were 250,000 employees at the VA when I 
started on this Committee, 2009. I think you just said there 
are now 373,000, and the budget has gone from $93 billion to 
$198 billion. That does not look like privatizing to me that 
looks like a commitment that this Nation is making to its 
Veterans. And I am proud of that.
    I think this is something--when I go home, and I live in a 
very conservative area of the country, I will never apologize 
for money we spend on our Nation's Veterans, never. So I think, 
and I do not think a person on this dais does, I think we can 
go home proudly and say that we have supported--and this entire 
Congress, both Republicans and Democrats have done this.
    Just lastly as we close, we have a number of questions for 
the record, and one of those I want to get out before is, is 
transition to Choice. And you do not have to answer it right 
now. But we have money that will last until the end of May, and 
then further money was appropriated
    Mr. Shulkin. Yes.
    The Chairman. --and then that is until the end of the 
fiscal year which is 1 October, 30 September. Then how do we 
get from 30 September to March of 2019 because that appears to 
be when we are going to have this--you will have the time, your 
team will have the time to get this fully--this new Choice 
program fully implemented? You do not have to answer that right 
now but I need that. And will it be under the budget caps?
    With that being said, I ask unanimous consent that all 
Members have 5 legislative days to revise and extend their 
remarks and include extraneous material. Without objection, so 
ordered. Hearing is adjourned.
    [The Independent Budget of Disabled American Veterans, 
Paralyzed Veterans of America, Veterans of Foreign Wars of the 
United States appears on p. ]

    [Whereupon, at 10:07 a.m., the Committee was adjourned.]

                            A P P E N D I X

                              ----------                              

         Prepared Statement of Honorable David J. Shulkin, M.D.
    Good morning Chairman Roe, Ranking Member Walz, and distinguished 
members of the Committee. Thank you for the opportunity to testify 
today in support of the President's Fiscal Year (FY) 2019 Budget, 
including the FY 2020 Advance Appropriation (AA) request. I am 
accompanied today by Jon Rychalski, Assistant Secretary for Management 
and Chief Financial Officer; Mark Yow, Chief Financial Officer for the 
Veterans Health Administration (VHA); James Manker, Acting Principal 
Deputy Under Secretary for Benefits; Matthew Sullivan, Deputy Under 
Secretary for Finance and Planning for the National Cemetery 
Administration (NCA), and Richard Chandler, Deputy Assistant Secretary 
for Resource Management, Office of Information and Technology. I also 
want to thank Congress for making 2017 a legislative success for 
Veterans. With the unwavering support and leadership of our VA 
Committees, Congress supported and passed groundbreaking legislation on 
Department of Veterans Affairs (VA) accountability, appeals reform, the 
Forever GI Bill, Veterans Choice improvements, personnel improvements, 
and extended Choice funding twice. We have important work left to do, 
but I am confident we are moving in the right direction. The 2019 
budget request fulfills the President's strong commitment to all of our 
Nation's Veterans by providing the resources necessary to improve the 
care and support our Veterans have earned through sacrifice and service 
to our country.
                  Fiscal Year (FY) 2019 Budget Request
    The President's FY 2019 Budget requests $198.6 billion for VA - 
$88.9 billion in discretionary funding (including medical care 
collections), of which $76.5 billion is requested as the FY 2019 AA for 
Medical Care including collections. The $76.5 billion is comprised of 
$74.1 billion previously requested (including collections), and an 
annual appropriation adjustment of $500 million for Medical Services 
for community care and $1.9 billion for the Veterans Choice Fund. In 
total, the discretionary request is an increase of $6.8 billion, or 8.3 
percent, over the President's FY 2018 Budget request. It will sustain 
the progress we have made and provide additional resources to improve 
patient access and timeliness of medical care services for the 
approximately 9 million enrolled Veterans eligible for VA health care, 
while improving benefits delivery for our Veterans and their 
beneficiaries. The President's FY 2019 budget also requests $109.7 
billion in mandatory funding, of which $107.7 billion was previously 
requested, for programs such as disability compensation and pensions.
    For the FY 2020 AA, the budget requests $79.1 billion in 
discretionary funding including collections for Medical Care and $121.3 
billion in mandatory advance appropriations for Compensation and 
Pensions, Readjustment Benefits, and Veterans Insurance and Indemnities 
benefits programs in the Veterans Benefits Administration (VBA).
    This is a strong budget request that fulfills the President's 
commitment to Veterans by ensuring the Nation's Veterans receive high-
quality health care and timely access to benefits and services while 
concurrently improving efficiency and fiscal responsibility. I urge 
Congress to support and fully fund our FY 2019 and FY 2020 AA budget 
requests - these resources are critical to enabling the Department to 
meet the increasing needs of our Veterans and successfully execute my 
top five priorities: 1) Focus Resources; 2) Modernize VA Systems and 
Services; 3) Improve Timeliness; 4) Suicide Prevention; and 5) Provide 
Greater Choice.
    I want to emphasize that the FY 2019 Budget is not a ``business as 
usual'' VA Budget. We have critically assessed and prioritized our 
needs and aggressively pursued internal offsets, modernization reforms, 
and other efficiencies to provide Veterans the quality care they have 
earned while serving as a responsible fiscal steward. I greatly 
appreciate Congress' ongoing support for VA, as demonstrated by 
consistent support for our legislative priorities and consistently 
generous enacted appropriations. On behalf of the entire VA and the 
many Veterans we serve, I thank you for your unflagging commitment to 
our mission. I take very seriously my obligation to you, the American 
taxpayer and the Veterans who served our country so well. That 
commitment is represented in this budget request in which I have worked 
to bend the cost curve through targeted spending and significant 
reforms in an attempt to ensure that the VA remains sustainable for 
years to come.

Priority 1: Focus Resources

    The FY 2019 Budget includes $ 76.5 billion for Medical Care, 
including collections, $4.2 billion above the FY 2018 Budget and $79.1 
billion for the FY 2020 AA. I am committed to ensuring Veterans get 
high quality, timely and convenient access to care that is affordable 
for future generations. As a result, I am implementing reforms that 
will prioritize our foundational services while redirecting to the 
private sector those services that they can do more effectively and 
efficiently. These foundational services are those that are most 
related to service-connected disabilities and unique to the skills and 
mission of VHA.

    Foundational Services include these mission-driven services, such 
as:

      Primary Care, including Women's Health;
      Urgent Care;
      Mental Health Care;
      Geriatrics and Extended Care;
      Rehabilitation (e.g., Spinal cord, brain injury/
polytrauma, prosthesis/orthoses, blind rehab);
      Post Deployment Health Care; and
      War-Related Illness and Injury Study Centers functions.

    VA facility and Veterans Integrated Service Network (VISN) leaders 
are being asked to assess additional, community options for other 
health services that are important to Veterans, yet may be as 
effectively or more conveniently delivered by community providers. 
Local VA leaders have been advised to consider accessibility of VA 
facilities and convenience factors (like weekend hours), as they 
develop recommendations for access to community providers for Veterans 
in their service areas. Let me be clear, however, that this is not the 
onset of privatizing VA.
    While the focus on foundational services will be a significant 
change to the way VA provides health care, VA will continue to ensure 
that the full array of statutory VA health care services are made 
available to all enrolled Veterans. VA will also continue to offer 
services that are essential components of Veteran care and assistance, 
such as assistance for homeless Veterans, Veterans Resource Centers, 
the Veterans Crisis Line/Suicide Prevention, Mental Health Intensive 
Case Management, treatment for Military Sexual Trauma, and substance 
abuse programs.
    Investing in foundational services within the Department is not 
limited to health care. For over a decade, NCA has achieved the highest 
customer satisfaction rating of any organization-public or private-in 
the country. They achieved this designation through the American 
Customer Satisfaction Index six consecutive times. The President's FY 
2019 Budget enables the continuation of this unprecedented success with 
a request for $315.8 million for NCA in FY 2019, an increase of $9.6 
million (3 percent) over the FY 2018 request. This request will support 
the 1,941 Full-Time Equivalent (FTE) employees needed to meet NCA's 
increasing workload and expansion of services. In FY 2019, NCA will 
inter over 134,000 Veterans and eligible family members and care for 
over 3.8 million gravesites. NCA will continue to memorialize Veterans 
by providing 364,850 headstones and markers, distributing 677,500 
Presidential Memorial Certificates, and expanding the Veterans Legacy 
program to communities across the country. VA is committed to investing 
in NCA infrastructure, particularly to keep existing national 
cemeteries open and to construct new cemeteries consistent with burial 
policies approved by Congress. In addition to NCA's funding, the FY 
2019 request includes $117.2 million in major construction funds for 
three gravesite expansion projects. Upon completion of these expansion 
projects, and the opening of new cemeteries, nearly 95 percent of the 
total Veteran -about 20 million Veterans-will have access to a burial 
option in a national or grant-funded state Veterans' cemetery within 75 
miles of their home.
    In order to provide Veterans and taxpayers the greatest value for 
each dollar, the Budget also proposes certain changes to the way in 
which we spend those resources. For example, our FY 2019 request 
proposes to merge the Medical Community Care appropriation with the 
Medical Services appropriation, as was the practice prior to FY 2017. 
The separate appropriation for Community Care has restricted our 
Medical Center Directors as they manage their budgets and make 
decisions about whether the care can be provided in their facility or 
must be purchased from community providers. This is a dynamic 
situation, as our staff must adjust to hiring and departures, 
emergencies such as the recent hurricanes, and other unanticipated 
changes in the health care environment throughout the year. This change 
will maximize our ability to focus even more resources on the services 
Veterans most need.
    To further ensure that our entire budget request is focused serving 
Veterans, VA has implemented an initiative to detect and prevent fraud, 
waste, and abuse (STOP FWA). In support of this initiative, VA (1) 
established the VA Prevention of Fraud, Waste, and Abuse Advisory 
Committee, which will provide VA insight into best practices utilized 
in the private and public sector; (2) is partnering with Centers for 
Medicare & Medicaid Services (CMS) to replicate their investigation 
process and utilize their data to identify medical providers with 
performance issues; and (3) is working with the Department of the 
Treasury to perform a deep dive to move VA's Community Care Program 
closer to the industry best practices.
    In 2019, VA will take steps to achieve mandatory savings of 
approximately $30 billion over the next 10 years, beginning in FY 2021. 
Due to advancements in treatment and medical technologies, there has 
been a decrease in the impacts of certain disabilities on the lives of 
many Veterans.

Priority 2: Modernizing VA Systems and Services

    Focusing resources will only take us so far - we need to modernize 
our VA systems and services, so the Department can continue to provide 
high quality, efficient care and services, and keep up with the latest 
technology and standards of care. Key modernization reform proposals 
included in the FY 2019 Budget Request are Electronic Health Record 
Modernization (EHRM), Financial Management Business Transformation, 
modernizing our legacy systems, and infrastructure improvements.

    Electronic Health Record Modernization

    The Budget invests $1.2 billion in EHRM. The health and safety of 
our Veterans is one of our highest national priorities. On June 5, 
2017, I announced my decision to adopt the same electronic health 
record (EHR) system as the Department of Defense (DoD). This 
transformation is about improving VA services and significantly 
enhancing the coordination of care for Veterans who receive medical 
care not only from VA, but DoD and our community partners. We have a 
tremendous opportunity for the future with EHRM to build transparency 
with Veterans and their care providers, expand the use of data, and 
increase our ability to communicate and collaborate with DoD and 
community care providers. In addition to improving patient care, a 
single, seamless EHR system will result in a more efficient use of VA 
resources, particularly as it relates to health care providers. Given 
the magnitude of this transformation and the significant long-term 
costs and complex contracting needs, we are requesting a single 
separate account for this effort.
    This new EHR system will enable VA to keep pace with the 
improvements in health information technology and cyber security which 
the current system, VistA, is unable to do. Moreover, the acquisition 
of the same solution as DoD, along with the added support of joint 
interagency governance and support from national EHR leadership 
including VA partners in industry, government, academic affiliates, and 
integrated health care organizations, will enable VA to meaningfully 
advance the goal of providing a single longitudinal patient record that 
will capture all of a Servicemember's active duty and Veteran health 
care experiences. It will enable seamless care between the Departments 
without the current manual and electronic exchange and reconciliation 
of data between two separate systems. To that end, I have insisted on 
high levels of interoperability and data accessibility with our 
commercial health partners in addition to the interoperability with 
DoD. Collectively, this will result in better service to our Veterans 
because transitioning Servicemembers will have their medical records at 
VA. VA is committed to providing the best possible care to Veterans, 
while also remaining committed to supporting Veterans' choices to seek 
care from private providers via our continued investment in the 
Community Care program.

    Legacy Systems Modernization

    The FY 2019 Budget continues VA's investment in technology to 
improve the lives of Veterans. The planned Information Technology (IT) 
investments prioritize the development of replacements for specific 
mission critical legacy systems, as well as operations and maintenance 
of all VA IT infrastructure essential to deliver medical care and 
benefits to Veterans. The request includes $381 million for development 
to replace specific mission critical legacy systems, such as the 
Benefits Delivery Network and the Burial Operations Support System. 
Investments in IT will also support efforts and initiatives that are 
directly Veteran-facing, such as mental health applications to support 
suicide prevention, modifications of multiple programs to accommodate 
special requirements of the community care program, Veteran self-
service applications (Navigator concept), education claims processing 
integration consolidation, and benefit claim appeals modernization. The 
Budget also invests $398 million for information security to protect 
Veterans' information.
    The FY 2019 Budget request would increase the Department's ability 
to apply agile program management to the dynamics of modern IT 
development requirements. To do this, the Department proposes 
increasing the transfer threshold from $1 million to $3 million between 
development project lines, which equates to less than 1 percent of the 
Development account. Through the Certification process, Congress will 
maintain visibility of proposed changes.

    Financial Management Business Transformation

    Another critical system that will touch the delivery of all health 
and benefits is our new financial management system, which is under 
development. The FY 2019 budget requests $72.8 million in IT funds and 
$48.8 million in fair share reimbursable funding from the 
Administrations for business process re-engineering to support 
Financial Management Business Transformation across the Department. 
These resources support the continued modernization of our financial 
management system by transforming the Department from numerous 
stovepipe legacy systems to a proven, flexible, shared service business 
transaction environment. Even though the U.S. Department of Agriculture 
(USDA) is not moving forward as VA's Federal Shared Service Provider, 
VA continues to work with USDA to ensure a smooth transition. VA's 
Office of Finance continues to manage the program and the 
implementation is on schedule and within budget.

    Infrastructure Improvements and Streamlining

    In FY 2019, VA will focus on improving its infrastructure while we 
transform our health care system to an integrated network to serve 
Veterans. This budget requests $1.1 billion in Major Construction 
funding, as well as $706.9 million in Minor Construction for priority 
infrastructure projects. This funding supports projects including the 
St. Louis, Missouri, Jefferson Barracks Medical Facility Improvements 
and Cemetery Expansion project; the Canandaigua, New York, Construction 
and Renovation project; the Dallas, Texas, Spinal Cord Injury project; 
and national cemetery expansions in Rittman, Ohio; Mims, Florida; and 
Holly, Michigan. VA is also requesting $964 million to fund more than 
2,100 medical leases in FY 2019 and $672.1 million for activation of 
new medical facilities.
    VA appreciates the support of Congress and is grateful for the 
passage of the VA Choice and Quality Employment Act of 2017 (Public Law 
(P.L.), 115-46), which included authorization for 28 major medical 
leases, some of which had been pending authorization for approximately 
3 years. The leases will establish new points of care, expand sites of 
care, replace expiring leases, and expand VA's research capabilities. 
In FY 2019, VA is seeking Congressional authorization of four new 
outpatient clinic leases to expand services currently offered at 
existing clinics. The requested leases would be located in the 
vicinities of Lawrence, Indiana; Plano, Texas; Baton Rouge, Louisiana; 
and Beaumont, Texas.
    The FY 2019 Budget includes a new initiative to address VA's 
highest priority facilities in need of seismic repairs and upgrades. 
VA's major construction request includes $400 million that will be 
dedicated to correct critical seismic issues that currently threaten 
the safety of Veterans and VA staff at VA facilities. The seismic 
program would fund newly identified unfunded, existing, and partially-
funded seismic projects within VA's major, minor, and non-recurring 
maintenance programs.
    VA's FY 2019 Budget includes proposed legislative requests, 
consistent with the Veteran Coordinated Access & Rewarding Experiences 
Act draft bill that VA submitted last fall, which, if enacted, would 
increase the Department's flexibility to meet its capital needs. These 
proposals include: 1) increasing from $10 million to $20 million the 
dollar threshold for minor construction projects; 2) modifying title 38 
to eliminate statutory impediments to joint facility projects with DoD 
and other Federal agencies; and 3) expanding VA's enhanced use lease 
authority to give VA more opportunities to engage the private sector 
and local governments to repurpose underutilized VA property.
    To maximize resources for Veterans, VA repurposed or disposed of 
131 of 430 vacant or mostly vacant buildings since June 2017. VA is on 
track to meet the goal that I set in June 2017 for VA to initiate 
disposal or reuse actions for all 430 buildings by June 2019.
    The Department is also a participant in the White House 
Infrastructure Initiative, which is exploring additional ways to 
modernize VA's real property assets, and support our continued delivery 
of quality care and services to our Nation's Veterans. The proposed 
Infrastructure Initiative includes flexibilities for VA to leverage 
existing assets to continue its efforts to reduce the number of vacant 
buildings in its inventory; tools to leverage VA assets for the 
construction of needed new facilities to serve Veterans; and an 
increase to VA's existing medical facility leasing threshold, which 
would streamline our leasing process so VA can more quickly and 
efficiently deliver facilities to provide care and services to 
Veterans.

    Accountability and Effective Management Practices

    Another critical system VA is significantly improving relates to 
employee accountability. The vast majority of employees are dedicated 
to providing Veterans the care they have earned and deserve. It is 
unfortunate that some employees have tarnished the reputation of VA 
while so many have dedicated their lives to serving our Nation's 
Veterans. We will not tolerate employees who deviate from VA's I-CARE 
(Integrity, Commitment, Advocacy, Respect, and Excellence) values and 
underlying responsibility to provide the best level of care and 
services to them. Last May, VA established the Office of Accountability 
and Whistleblower Protection. Between June 1, 2017, and December 31, 
2017, VA removed more than 900 staff (not including probationary 
terminations) and placed more than 250 staff on suspensions of 14 days 
or greater. We thank Congress for passing the Department of Veterans 
Affairs Accountability and Whistleblower Protection Act of 2017 (P.L. 
115-41), so that new accountability rules for VA are now the law of the 
land.
    We are also focused on improving our unduly burdensome internal 
hiring practices. In the face of a national shortage of health care 
providers, VHA faces competition with the commercial sector for scarce 
resources. Over the past year, we reduced the time it took to hire 
Medical Center Directors by 40 percent and obtained approval from the 
Office of Personnel Management for critical position pay authority for 
many of our senior health care leaders. But there is much work left to 
do. I will need Congress' help with legislation to reform recruitment 
and compensation practices allowing VA to stay competitive with the 
private sector and other employers.

Priority 3: Improve Timeliness

    Access to Care and Wait Times

    VA is committed to delivering timely and high quality health care 
to our Nation's Veterans. Veterans now have access to same-day services 
for primary care and mental health care at the more than 1,000 all VA 
clinics across our system. I am also committed to ensuring that any 
Veteran who requires urgent care will receive timely care.
    In 2017, 81.5 percent of nearly 6 million outpatient appointments 
for new patients were completed within 30 days of the day the Veteran 
first requested the appointment (``create date''), whereas 97.3 percent 
of nearly 50.2 million established appointments were completed within 
30 days of the date requested by the patient (``patient-indicated 
date''). VHA has reduced the Electronic Wait List from 56,271 entries 
to 20,829 entries, a 63.0 percent reduction between June 2014 and 
December 2017. The Electronic Wait List reflects the total number of 
all patients for whom appointments cannot be scheduled in 90 days or 
less. During FY 2018 and FY 2019, VA will continue to focus its efforts 
to reduce wait times for new patient appointments, with a particular 
emphasis on primary care, mental health, and medical and surgical 
specialties.
    In FY 2019, VA will expand Veteran access to medical care by 
increasing medical and clinical staff, improving its facilities, and 
expanding care provided in the community. The FY 2019 Budget requests a 
total of $76.5 billion in funding for Veterans' medical care in 
discretionary budget authority, including collections. The FY 2019 
request will support nearly 315,688 medical care FTE, an increase of 
over 5,792 above the 2018 level.
    VA is implementing a VISN-level Gap Coverage plan that will enable 
facilities to request gap coverage providers in areas that are 
struggling with staffing shortages. It is a seamless electronic request 
that allows VISNs to focus resources where they are most needed 
according to supply and demand. Telehealth will be the principal form 
of coverage in this initiative, which is budget neutral.
    NCA has begun phase one expansion of the weekend burial pilot 
program, which provides Veterans and family members with increased 
access to burials at select national cemeteries. During phase one, NCA 
will offer cremation-only weekend burials at six cemeteries. The FY 
2019 Budget will support phase two of the pilot by expanding the 
weekend program to an additional five cemeteries.

    Accelerating Processing of Disability Claims

    Since 2013, VA has made remarkable progress toward reducing the 
backlog of disability compensation claims pending over 125 days. VBA's 
FY 2019 budget request of $2.9 billion would allow VBA to maintain the 
improvements made in claims processing over the past several years. 
This budget prioritizes more timely review of 1.3 million rating claims 
and 187,000 higher level reviews to decrease the amount of time 
Veterans wait for a resolution. It also prioritizes fiduciary care for 
vulnerable beneficiaries to ensure protection for VA's most vulnerable 
veterans who are unable to manage their VA benefits. This budget 
supports the disability compensation benefits program for 4.5 million 
Veterans and 600,000 survivors.
    To continue improving disability compensation claims processing, 
VBA has implemented an initiative called Decision Ready Claims (DRC). 
The DRC initiative offers Veterans, Servicemembers, and survivors 
faster supplemental claims decisions through a partnership with 
Veterans Service Organizations (VSO) and other accredited 
representatives to assist applicants with ensuring all supporting 
evidence is included with the claim at the time of submission, enabling 
the claim to be decided within 30 days of submission to VA. In FY 2019, 
VBA plans to complete 25 percent, or nearly 300,000 disability 
compensation claims, under the more timely DRC initiative.

    Decisions on Appeals

    In August 2017, the President signed into law the Veterans Appeals 
Improvement and Modernization Act of 2017 (P.L. 115-55), which 
represents the most significant statutory change to affect VA claims 
and appeals in decades and provides much-needed reform. VA is in the 
process of implementing the new claims and appeals system by 
promulgating regulations, establishing procedures, hiring and training 
personnel, and developing IT systems. By February 2019, all requests 
for review of VA decisions will be processed under the new law, which 
will provide a more efficient claims and appeals process for Veterans, 
with opportunities for early resolution of disagreements with VA 
decisions.
    The FY 2019 request of $174.8 million for the Board of Veterans' 
Appeals (the Board) is $19.2 million above the FY 2018 Budget and will 
sustain the 1,025 FTE who will adjudicate and process legacy appeals 
while implementing the Appeals Improvement and Modernization Act. The 
Board is currently on pace to produce over 81,000 decisions, a historic 
level of production.
    In addition, VBA is also undertaking a similar, multi-pronged 
approach to modernize its appeals process through legislative reform, 
increased resources, technology, process improvements, and increased 
efficiencies. The requested $74 million for appeals processing 
increases VBA's appeals FTEs by 605, more than 40 percent above 2018.
    This increase comes after VBA realigned its administrative appeals 
program under the Appeals Management Office (AMO) in January 2017, as 
part of an effort to streamline and improve performance in legacy 
appeals processing. The improved focus and accountability resulting 
from this realignment helped increase VBA appeals production by 24 
percent, decrease its appeals inventory by 10 percent, and increase its 
appeals resolutions by 10 percent, resolving over 124,000 appeals 
during FY 2017.
    In FY 2019, the Appeals Modernization project will achieve the 
benefit of using Caseflow Certification, which is a commercially 
developed system that will help reduce errors and delays caused by 
disjointed manual processing, and improve the Veteran experience by 
enabling transparency of appeals processing and ultimately facilitating 
the delivery of more timely appeals decisions.

Priority 4: Suicide Prevention

    Suicide prevention is VA's highest clinical priority, and Veteran 
suicide is a national health crisis. On average, 20 Veterans die by 
suicide every day -this is unacceptable. The integration of Mental 
Health program offices and their alignment with the suicide prevention 
team and the Veterans Crisis Line is being implemented to further 
enhance VA's ability to effectively meet the needs of the most 
vulnerable Veterans. The FY 2019 Budget Request increases resources to 
standardize suicide screening and risk assessments and expands options 
for safe and effective treatment for Veterans struggling with post-
traumatic stress disorder and suicide.
    The FY 2019 Budget requests $8.6 billion for Veterans' mental 
health services, an increase of 5.8 percent above the 2018 current 
estimate. It also includes $190 million for suicide prevention 
outreach. VA recognizes that Veterans are at an increased risk for 
suicide, and we have implemented a national suicide prevention strategy 
to address this crisis. VA is bringing the best minds in the public and 
private sectors together to determine the next steps in implementing 
the Ending Veteran Suicide Initiative. VA's suicide prevention program 
is based on a public health approach that is ongoing, utilizing 
universal, selective, indicated strategies while recognizing that 
suicide prevention requires ready access to high-quality mental health 
services, supplemented by programs that address the risk for suicide 
directly, starting far earlier in the trajectory that leads to a 
Veteran taking his or her own life. VA cannot do this alone; 70 percent 
of Veterans who die by suicide are not actively engaged in VA health 
care. Veteran suicide is a national issue and can only be ended through 
a nationwide community-level approach that begins to solve the upstream 
risks Veterans face, such as loss of belonging, meaningful employment, 
and engagement with family, friends, and community.

    Executive Order to Improve Mental Health Resources

    On January 9, 2018, President Trump signed an Executive Order 
(13822) titled, ``Supporting Our Veterans During Their Transition From 
Uniformed Service to Civilian Life.'' This Executive Order directs DoD, 
VA, and the Department of Homeland Security to develop a Joint Action 
Plan that describes concrete actions to provide access to mental health 
treatment and suicide prevention resources for transitioning uniformed 
Servicemembers in the year following their discharge, separation, or 
retirement.
    VA encourages all transitioning Servicemembers and Veterans to 
contact their local VA medical facility or Vet Center to learn about 
what VHA mental health care services may be available.

    REACH VET Initiative

    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) program. This program finishes its first year of full 
implementation in February 2018 and has identified more than 30,000 at 
risk Veterans to date. REACH VET uses a new predictive model 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, so that VHA providers can review 
and enhance care and talk to these Veterans about their needs. REACH 
VET was expanded to provide risk information about suicide and opioids, 
as well as clinical decision support to Veterans Crisis Line responders 
and is being further expanded to provide this important risk 
information to frontline VHA providers. REACH VET is limited to 
Veterans engaged in our health care system and is risk-focused, so 
while it is critically important to those Veterans it touches, it is 
not enough to bring down Veteran suicide rates. We will continue to 
take bold action aimed at ending all Veteran suicide, not just for 
those engaged with our system.

    Other than Honorable Initiative

    We know that 14 of the 20 Veterans who, on average, died by suicide 
each day in 2014 did not, for various reasons, receive care within VA 
in 2013 or 2014. Our goal is to more effectively promote and provide 
care and assistance to such individuals to the maximum extent 
authorized by law. To that end, beginning on July 5, 2017, VA promoted 
access to care for emergent mental health care to the more than 500,000 
former Servicemembers who separated from active duty with other than 
honorable (OTH) administrative discharges. This initiative specifically 
focuses on providing access to former Servicemembers with OTH 
administrative discharges who are in mental health distress and may be 
at risk for suicide or other adverse behaviors. As part of this 
initiative, former Servicemembers with OTH administrative discharges 
who present to VA seeking emergency mental health care for a condition 
related to military service would be eligible for evaluation and 
treatment for their mental health condition. Such individuals may 
access the VA system for emergency mental health services by visiting a 
VA emergency room, outpatient clinic, Vet Center, or by calling the 
Veterans Crisis Line. Services may include assessment, medication 
management/pharmacotherapy, lab work, case management, psycho-
education, and psychotherapy. As of December 30, 2017, VHA had received 
3,241 requests for health care services under this program. In 
addition, in FY 2017, Readjustment Counseling Services through Vet 
Centers provided services to 1,130 Veterans with ``Other than 
Honorable'' administrative discharges and provided 9,889 readjustment 
counseling visits.

Priority 5: Greater Choice for Veterans

    Veterans deserve greater access, choice, and control over their 
health care. VA is committed to ensuring Veterans can make decisions 
that work best for themselves and their families. Our current system of 
providing care for Veterans outside of VA requires that Veterans and 
community providers navigate a complex and confusing bureaucracy. VA is 
committed to building an improved, integrated network for Veterans, 
community providers, and VA employees; we call these reforms Veteran 
Coordinated Access & Rewarding Experiences, or Veteran CARE. VA 
submitted the Veteran CARE legislative proposal package to Congress 
last fall. The Administration submitted $4 billion in mandatory offsets 
to fully support the transition from the Veterans Choice Program to the 
consolidated CARE program through FY 2018 and into FY 2019.
    Veteran CARE would clarify and simplify eligibility requirements, 
build a high performing network, streamline clinical and administrative 
processes, and implement new care coordination support for Veterans. 
Veteran CARE would improve Veterans' experience and access to health 
care, building on the best features of existing community care 
programs. This new program would complement and support VA's internal 
capacity for the direct delivery of care with an emphasis on 
foundations services. The CARE reforms would provide VA with new tools 
to compete with the private sector on quality and accessibility.
    Demand for community care remains high. The Veterans Choice Program 
comprised approximately 62 percent of all VA community care completed 
appointments in FY 2017. We thank Congress for the combined $4.2 
billion provided in Calendar Year 2017 to continue the Choice Program 
while discussions continue regarding the future of VA community care. 
Based on historical trends, current Choice funding may last until the 
end of May 2018, depending on program utilization. VA has partnered 
with Veterans, community providers, VSOs, and other stakeholders to 
understand their needs and incorporate crucial input into the concept 
for a consolidated VA community care program. Currently, VA is working 
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. The time to act is 
now, and we need your help.
    In FY 2019, the Budget reflects 14.2 billion in total obligations 
to support community care for Veterans. This includes an additional 
$2.4 billion in discretionary funding that is now available as a result 
of the recently enacted legislation to raise discretionary spending 
caps. Of this amount, $1.9 billion replaces the mandatory funding that 
was originally requested in FY 2018 to be carried over into FY 2019. 
This funding will be used to continue the Choice Program for a portion 
of FY 2019 until VA is able to fully implement the Veteran CARE 
program. The remaining $500 million will support VA's traditional 
community care program in FY 2019. The Administration would also 
support using discretionary funding provided in FY 2018 in the cap deal 
to ensure that the Choice Program can continue to operate for the 
remainder of FY 2018.
    Finally, the Budget transitions VA to recording community care 
obligations on the date of payment, rather than the date of 
authorization. This change in the timing of obligations results in a 
one-time adjustment of $1.8 billion, which would support a total 2019 
program level of $14.2 billion for community care needs.

Forever GI Bill

    In addition to expanding choice in health care, the Harry W. 
Colmery Veterans Educational Assistance Act of 2017 or the Forever GI 
Bill contains 34 new provisions, the vast majority of which will 
enhance or expand education benefits for Veterans, Servicemembers, 
Families and Survivors. Most notably, this new law removes the 15-year 
time limitation for Veterans who transitioned out of the military after 
January 1, 2013, to use their Post-9/11 GI Bill benefits. This law also 
restores benefits to Veterans who were impacted by school closures 
since 2015, expands benefits for certain Reservists, surviving 
dependents, Purple Heart recipients, and provides many other 
improvements. Thirteen of the 34 provisions were effective on the date 
of enactment, while the remaining provisions have future effective 
dates ranging from January 1, 2018, to August 1, 2022.
                                Closing
    Thank you for the opportunity to appear before you today to address 
our FY 2019 budget and FY 2020 AA budget requests. These resources will 
honor the President's commitment to Veterans by continuing to enable 
the high quality care and benefits our Veterans have earned. They will 
support my efforts to achieve my top priorities while ensuring that VA 
is a source of pride for Veterans, beneficiaries, employees, and 
taxpayers. I ask for your steadfast support in funding our full FY 2019 
and FY 2020 AA budget requests and continued partnership in making bold 
changes to improve our ability to serve Veterans. I look forward to 
your questions.

                                 
                       Statements For The Record

                         THE INDEPENDENT BUDGET
             Budget Recommendations for FY 2019 and FY 2020
Introduction

    For more than 30 years, the co-authors of The Independent Budget-
DAV (Disabled American Veterans), Paralyzed Veterans of America (PVA), 
and Veterans of Foreign Wars (VFW)-have presented our budget and policy 
recommendations to Congress and the Administration. Our recommendations 
are meant to inform Congress and the Administration of the needs of our 
members and all veterans and to offer substantive solutions to address 
the many health care and benefits challenges they face. This budget 
report serves as our benchmark for properly funding the Department of 
Veterans Affairs (VA) to ensure the delivery of timely, quality health 
care and accurate and appropriate benefits.
    The Independent Budget veterans' service organizations (IBVSOs) 
recognize that Congress and the Administration continue to face immense 
pressure to reduce Federal spending. However, we believe that the ever-
growing demand for health care and benefits, particularly with more 
health care being provided in the community and purchased by VA, 
certainly validates the continued need for sufficient funding. We 
understand that VA has fared better than most Federal agencies in 
budget proposals and appropriations, but the real measure should be how 
well the funding matches the demand for veterans' benefits and 
services.
    We appreciate that Congress remains committed to doing the right 
thing and has continued to provide increases in appropriations dollars. 
However, the serious access problems in the health care system 
identified in 2014, and the continued pressure being placed on the 
claims processing system, raise serious questions about the adequacy of 
resources being provided and how VA chooses to spend these resources.
    The IBVSOs are jointly releasing this report on the budget for VA 
and our projections for VA's funding needs across all programs. In 
submitting our recommendations the IBVSOs are attempting to produce an 
honest assessment of need that is not subject to the politics of 
Federal budget development and negotiations that inevitably have led to 
continuous funding deficits.
    Our recommendations include funding for all discretionary programs 
for FY 2019 as well as advance appropriations recommendations for 
medical care accounts for FY 2020. The FY 2019 projections are 
particularly important because VA has been operating under a continuing 
resolution nearly halfway through FY 2018 without the additional 
resources necessary to meet all the requirements and initiatives of the 
Department. We hope that Congress will take this defined shortfall very 
seriously and appropriately address this need. Our own FY 2019 
estimates affirm this need, which is based pending FY 2018 
appropriations bills.
    We hope that the House and Senate Committees on Veterans' Affairs 
as well as the Military Construction and Veterans' Affairs 
Appropriations Subcommittees will be guided by these estimates in 
making their decisions to ensure sufficient, timely, and predictable 
funding for VA.
[GRAPHIC] [TIFF OMITTED] T5385.001

    * Assumes funding levels in S. 1557, the Military Construction, 
Veterans Affairs, and Related Agencies Appropriations Act, 2018.
    **Choice Program funding is currently scored as a mandatory cost 
for VA.

Veterans Health Administration


                           Total Medical Care
 
 
 
            FY 2019 IB Recommendation                   $82.6 billion
------------------------------------------------------------------------
FY 2019 Revised Administration Request                  $72.6 billion
             Medical Care Collections                   $3.44 billion
                                Total                   $76.0 billion
------------------------------------------------------------------------
FY 2018 Estimated Final Appropriation                   $71.5 billion
             Medical Care Collections                   $3.25 billion
                                Total                   $74.7 billion
------------------------------------------------------------------------
    FY 2020 IB Advance Appropriations                   $84.5 billion
                        Recommendation
       FY 2020 Administration Advance                   $75.6 billion
                Appropriations Request
             Medical Care Collections                   $3.58 billion
                                Total                   $79.1 billion
 

    The IBVSOs have serious concerns about VA's current funding level 
of FY 2018 based on the current continuing resolution funding the 
Department through the first half of the fiscal year largely based on 
the Administration's request. Last year, however, the former Secretary 
of Veterans Affairs openly admitted that the FY 2018 advance 
appropriations request was significantly short. He also indicated that 
the new Administration and Congress would have to correct this 
shortfall. We are concerned that Congress has not corrected this 
problem with VA currently operating under a continuing resolution 
nearly been operating under a continuing resolution nearly halfway 
through FY 2018 without the additional resources necessary to meet all 
the requirements and initiatives of the Department.
    If legislation is enacted, starting in FY 2019 VA will record 
community care obligations on the date of payment rather than the date 
of authorization. This change in the timing of obligations is estimated 
to result in a one-time availability of funds totaling $1.8 billion. VA 
also identifies in its budget request $1.9 billion in mandatory budget 
authority, which it requested in 2018 for the Choice program, to be 
carried forward into 2019. We are concerned the availability of such 
funds remains uncertain. If any amounts are not realized, VA must 
request and Congress must provide these needed resources.
    In addition, VA's budget request indicates that VA will begin to 
implement its proposal to consolidate and streamline its community care 
programs, known as the Veterans Coordinated Access and Rewarding 
Experiences (Veteran CARE). With Congress considering different 
legislative proposals, including expanded eligibility criteria and VA's 
CARE plan, including several proposals that require congressional 
action, the direct impact on needed resources to execute this new 
program must be determined and addressed. Congress must provide the 
necessary resources to successfully implement any newly enacted 
community care legislation to ensure veterans receive high quality and 
timely medical care from VA, and when necessary in the community.
    For FY 2019, the IB recommends approximately $82.6 billion in total 
medical care funding. We are estimating Congress to appropriate $74.7 
billion FY 2018 (which includes an assumption of approximately $3.3 
billion in medical care collections). Additionally, The Independent 
Budget recommends approximately $84.5 billion for total Medical Care 
for FY 2020. This recommendation reflects the necessary adjustment to 
the baseline for all Medical Care program funding in the preceding 
fiscal years. Notably, the VA proposes to consolidate the Choice 
program and Medical Community Care into the Medical Services account 
for FY 2020.

Medical Services

                       Appropriations for FY 2019
 
 
 
            FY 2019 IB Recommendation                   $53.6 billion
------------------------------------------------------------------------
FY 2019 Revised Administration Request                  $49.2 billion
             Medical Care Collections                    3.44 billion
                             Subtotal                   $52.6 billion
------------------------------------------------------------------------
FY 2018 Estimated Final Appropriation                   $46.8 billion
             Medical Care Collections                   $3.25 billion
                             Subtotal                   $50.1 billion
 

    For FY 2019, The Independent Budget recommends $53.7 billion for 
Medical Services. This recommendation is a reflection of multiple 
components. These components include the following recommendations:


 
 
 
                         Current Services Estimate                                $50,794,232,000
                      Increase in Patient Workload                                 $1,636,092,000
              Additional Medical Care Program Cost                                 $1,230,951,000
                    Total FY 2019 Medical Services                                $53,661,274,000
 

    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 1.1 percent 
increase for pay and benefits across the board for all VA employees in 
FY 2019.
    Our estimate of growth in patient workload is based on a projected 
increase of approximately 94,000 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 $1.6 
billion.
    The Independent Budget believes that there are additional projected 
medical program funding needs for VA. Those costs total over $1.2 
billion. Specifically, we believe there is real funding needed to 
address the array of long-term-care issues facing VA, including the 
shortfall in non-institutional services due to unremitting waitlist for 
home and community based services; to provide additional centralized 
prosthetics funding (based on actual expenditures and projections from 
the VA's Prosthetics and Sensory Aids Service); funding to expand and 
improve services for women veterans; funding to support the recently 
approved authority for reproductive services, to include in vitro 
fertilization (IVF); funding to allow VA to meet the costs for 
emergency care as dictated by the Richard W. Staab v. Robert A. 
McDonald ruling by the U.S. Court of Appeals for Veterans Claims, and; 
initial funding for implementation of extending comprehensive caregiver 
support services to severely ill and injured veterans of all eras.

Long-Term Services and Supports

    The Independent Budget recommends a modest increase of $82 million 
for FY 2019. This recommendation reflects a significant demand for 
veterans in need of Long Term Services and Supports (LTSS) in 2017 
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. This increase in funding also reflects a 
rebalancing of available resources towards home- and community-based 
care which will likely yield a commensurate decrease in institutional 
spending as is being achieved by State with their balancing of spending 
initiatives.

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 2017 to FY 
2018 and the expected continued growth in expenditures for FY 2019.

Women Veterans

    The Medical Services appropriation should be supplemented with $500 
million designated for women's health care programs, in addition to 
those amounts already included in the FY 2018 baseline. These funds 
would allow the Veterans Health Administration (VHA) to hire and train 
an additional 1,000 women's health providers to meet increasing demand 
for health services based on the significant growth in the number of 
women veterans coming to VA for care.
    Additional funds are needed to expand and repair VA facilities to 
meet environment of care standards and address identified privacy and 
safety issues for women patients. The new funds would also aid VHA in 
continuing its initiative for agency-wide cultural transformation to 
ensure women veterans are recognized for their military service and 
made to feel welcome at VA. Finally, additional resources are needed to 
evaluate and improve mental health and readjustment services for 
catastrophically injured or ill women veterans and wartime service-
disabled women veterans, as well as targeted efforts to address higher 
suicide rates and homelessness among this population.

Reproductive Services (to Include IVF)

    Congress authorized appropriations for the remainder of FY 2018 and 
FY 2019 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 2019. 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 2019.

Emergency Care

    VA has issued regulations to begin paying for veterans who sought 
emergency care outside of the VA health care system based on the Staab 
court ruling by the U.S. Court of Appeals for Veterans Claims. The 
requested $298 million increase in funding reflects the amounts VA has 
estimated will need to dispose of pending and future claims through FY 
2019.

Extending Eligibility for Comprehensive Caregiver Supports

    Included in this year's IB budget recommendation is funding 
necessary to implement eligibility expansion of VA's comprehensive 
caregiver support program to severely injured veterans of all eras. 
Funding level is based on the Congressional Budget Office estimate for 
preparing the program, including increased staffing and IT needs, and 
the beginning of the first phase as reflected in our $11 million FY 
2019 recommendation.

Medical Services

                   Advance Appropriations for FY 2020
 
 
 
    FY 2020 IB Advance Appropriations                   $54.7 billion
                        Recommendation
------------------------------------------------------------------------
      FY 2020 Administration Advance                    $63.2 billion
          Appropriations Request
          Medical Care Collections                      $3.58 billion
                 Subtotal                               $66.7 billion
 

    The Independent Budget once again offers baseline projections for 
funding through advance appropriations for the Medical Care accounts 
for FY 2020. 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 2019 advance 
appropriations request with mounting requirements. This trend cannot be 
allowed to continue, particularly as Congress looks for ways to reduce 
discretionary spending, even when those reductions cannot be justified.
    Moreover, VA has proposed to merge programs and resources from the 
Choice program and Medical Community Care into the Medical Services 
Account beginning FY 2020. For FY 2020, The Independent Budget 
recommends approximately $75.7 billion for Medical Services, not 
including community care recommendation of $10 billion. Our Medical 
Services level includes the following recommendations:


 
 
 
                         Current Services Estimate                                $51,541,538,000
                      Increase in Patient Workload                                 $1,599,848,000
              Additional Medical Care Program Cost                                 $1,546,158,000
                    Total FY 2020 Medical Services                                $54,687,544,000
 

    Our estimate of growth in patient workload is based on a projected 
increase of approximately 94,000 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 $1.6 
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.
    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 
$326 million, reflecting the ever-growing cost of more advanced 
prosthetics being prescribed for seriously disabled veterans. We 
believe that VA should invest a minimum of $509 million as an advance 
appropriation in FY 2020 to expand and improve access to women 
veterans' health care programs. Our additional program cost 
recommendation includes continued investment of over $20 million to 
support extension of the authority to provide reproductive services to 
the most catastrophically disabled veterans and VA's cost burden of 
$309 million for emergency care claims dictated by the Staab ruling. 
Finally, the FY 2020 recommendation includes an increase of $298 
million to provide comprehensive support and services to caregivers of 
veterans severely injured before September 11, 2001.

Medical Community Care

 
 
 
 
            FY 2019 IB Recommendation                   $14.8 billion
------------------------------------------------------------------------
FY 2019 Revised Administration Request                  $8.38 billion
------------------------------------------------------------------------
FY 2018 Estimated Final Appropriation                   $9.67 billion
                       Choice Program                   $2.10 billion
                             Subtotal                   $11.8 billion
------------------------------------------------------------------------
    FY 2020 IB Advance Appropriations                   $15.0 billion
                        Recommendation
------------------------------------------------------------------------
       FY 2020 Administration Advance                   $0.00 billion
                Appropriations Request
 

    For Medical Community Care, The Independent Budget recommends $14.8 
billion for FY 2019 and $15 billion for FY 2020. Our recommended 
increase includes the growth in current services to include current 
obligations under the Choice program. The Choice program is a temporary 
program with mandatory funding provided under an emergency designation. 
VA received an infusion of $2.1 billion in December 2017 after it 
notified Congress program resources could be depleted as early as 
January 2018. While increasing access to community care, the Choice 
program has in turn increased veterans reliance on VA medical care.
    We also believe funding VA programs for community care with a 
discretionary and mandatory account creates unnecessary waste and 
inefficiency. The Independent Budget has advocated for moving all 
funding authorities for the Choice program (and other community care 
programs) into the discretionary accounts of the VA managed under the 
Medical and Community Care account.

Medical Support and Compliance

 
 
 
 
            FY 2019 IB Recommendation                   $6.84 billion
FY 2019 Revised Administration Request                  $7.24 billion
FY 2018 Estimated Final Appropriation                   $6.75 billion
    FY 2020 IB Advance Appropriations                   $7.37 billion
                        Recommendation
       FY 2020 Administration Advance                   $7.11 billion
                Appropriations Request
 

    For Medical Support and Compliance, The Independent Budget 
recommends $6.8 billion for FY 2019. Our projected increase reflects 
growth in current services based on the impact of inflation on the FY 
2018 appropriated level. Additionally, for FY 2020 The Independent 
Budget recommends $7.3 billion for Medical Support and Compliance. This 
amount also reflects an increase in current services from the FY 2019 
advance level.

Medical Facilities

 
 
 
 
            FY 2019 IB Recommendation                   $7.39 billion
------------------------------------------------------------------------
FY 2019 Revised Administration Request                  $5.94 billion
------------------------------------------------------------------------
FY 2018 Estimated Final Appropriation                   $6.14 billion
    FY 2020 IB Advance Appropriations                   $7.51 billion
                        Recommendation
------------------------------------------------------------------------
       FY 2020 Administration Advance                   $5.28 billion
                Appropriations Request
 

    For Medical Facilities, The Independent Budget recommends $7.3 
billion for FY 2019, which includes a $1.2 billion for Non-Recurring 
Maintenance (NRM). The NRM program is VA's primary means of addressing 
its most pressing infrastructure needs as identified by Facility 
Condition Assessments (FCA). These assessments are performed at each 
facility every three years, and highlight a building's most pressing 
and mission critical repair and maintenance needs. VA's request for FY 
2019 includes $1.4 billion for NRM funding. While the Department has 
actually spent on average approximately $1.5 billion yearly for NRM, we 
are concerned its FY 2019 request includes diverting funds programmed 
for other purposes-$210.7 million from Medical Support and Compliance 
and $39.3 million from the Medical Services/Medical Community Care 
accounts.
    For FY 2020, The Independent Budget recommends approximately $7.5 
billion for Medical Facilities. Last year the Administration's 
recommendation for NRM reflected a projection that would place the 
long-term viability of the health care system in serious jeopardy. This 
deficit must be addressed in light of its $600 million request for FY 
2020.

Medical and Prosthetic Research

 
 
 
 
            FY 2019 IB Recommendation                    $758 million
              Million Veteran Program                     $65 million
Total IB Medical and Prosthetic Research                 $823 million
------------------------------------------------------------------------
       FY 2019 Administration Request                    $727 million
------------------------------------------------------------------------
FY 2018 Estimated Final Appropriation                    $722 million
 

    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. The research program is an important tool in VA's 
recruitment and retention of health care professionals and clinician-
scientists to serve our nation's veterans. By fostering a spirit of 
research and innovation within the VA medical care system, the VA 
research program ensures that our veterans are provided state-of-the-
art medical care.

Investing Taxpayers' Dollars Wisely

    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. As estimated by the Department of Commerce, 
Bureau of Economic Analysis, and the National Institutes of Health, for 
VA research to maintain current service levels, the Medical and 
Prosthetic Research appropriation should be increased in FY 2019 to go 
beyond simply keeping pace with inflation to make up for how long the 
continuing resolution funding level for FY 2018 has been in effect.
    Numerous meritorious proposals for new VA research cannot be funded 
without an infusion of additional funding for this vital program. 
Research awards decline as a function of budgetary stagnation, so VA 
may resort to terminating ongoing research projects or not funding new 
ones, and thereby lose the value of these scientists' work, as well as 
their clinical presence in VA health care. When denied research 
funding, many of them simply choose to leave the VA.

Emerging Research Needs

    In addition to covering uncontrollable inflation, the IBVSOs 
believe Congress should expand research on emerging conditions 
prevalent among newer veterans, as well as continuing VA's inquiries in 
chronic conditions of aging veterans from previous wartime periods. For 
example, additional funding will help VA support areas that remain 
critically underfunded, including:

      Post-deployment mental health concerns such as PTSD, 
depression, anxiety, and suicide in the veteran population;
      The gender-specific health care needs of the VA's growing 
population of women veterans;
      New engineering and technological methods to improve the 
lives of veterans with prosthetic systems that replace lost limbs or 
activate paralyzed nerves, muscles, and limbs;
      Studies dedicated to understanding chronic multi-symptom 
illnesses among Gulf War veterans and the long-term health effects of 
potentially hazardous substances to which they may have been exposed; 
and
      Innovative health services strategies, such as telehealth 
and self-directed care, that lead to accessible, high-quality, cost-
effective care for all veterans.
      Leverage the only known integrated and comprehensive 
caregiver support program in the U.S. to help inform policy makers and 
other health systems looking to support informal caregivers.

Million Veteran Program

    The VA Research program is uniquely positioned to advance genomic 
medicine through the ``Million Veteran Program'' (MVP), an effort that 
seeks to collect genetic samples and general health information from 1 
million veterans over the next five years. When completed, the MVP will 
constitute one of the largest genetic repositories in existence, 
offering tremendous potential to study the health of veterans. To date, 
more than 620,000 veterans have enrolled in MVP far exceeding the 
enrollment numbers of any single VA study or research program in the 
past, and is in fact one of the largest research cohorts of its kind in 
the world.. The VA estimates it currently costs around $75 to sequence 
each veteran's blood sample. Accordingly, the IBVSOs recommend $65 
million to enable VA to begin processing the MVP samples collected. 
Congress must begin a targeted investment to go beyond basic, surface 
level genetic information and perform deeper sequencing to begin 
reaping the benefits of this program.
General Operating Expenses (GOE)

                    Veterans Benefits Administration
 
 
 
            FY 2019 IB Recommendation                   $3.10 billion
------------------------------------------------------------------------
       FY 2019 Administration Request                   $2.87 billion
------------------------------------------------------------------------
FY 2018 Estimated Final Appropriation                   $2.91 billion
 

    The Veterans Benefits Administration (VBA) account is comprised of 
six primary divisions. These include Compensation; Pension; Education; 
Vocational Rehabilitation and Employment (VR&E); Housing; and 
Insurance. The increases recommended for these accounts primarily 
reflect current services estimates with the impact of inflation 
representing the grounds for the increase. However, two of the 
subaccounts-Compensation and VR&E-also reflect modest increases in 
requested staffing to meet the rising demand for those benefits and 
backlogs of pending workload.
    The IB recommends approximately $3.104 billion for the VBA for FY 
2019, an increase of approximately $194 million over the estimated FY 
2018 appropriations level. Our recommendation includes approximately 
$92 million in additional funds in the Compensation account above 
current services, and approximately $18 million more in the VR&E 
account above current services to provide for new full-time equivalent 
employees (FTEE).

Compensation Service Personnel           900 New FTEEs           $92.4 
    million

    In recent years VBA has made significant progress in reducing the 
claims backlog, which was over 610,000 claims in March 2013. Today, the 
claims backlog is roughly 79,000 claims, a decrease of 87 percent from 
its peak, and a decrease of about 18,000 claims compared to one year 
prior. VA defines a backlogged disability claim as one pending over 125 
days. Overall, the total pending claims workload decreased from about 
390,000 in January 2017 to just over 320,000 claims today, a decrease 
of 18 percent in the past year. During that time, the average days to 
complete a claim dropped from 119 days last year to 103 days this 
January.
    However, the trends on accuracy have gone the other direction. In 
January 2015, the 12-month issue-level accuracy was approximately 96 
percent; today it is down to about 94.5 percent, though it has leveled 
off over the past eight months. The 12-month claim-based accuracy 
measurement has dropped from approximately 91 percent in January 2015 
to less than 85 percent today. While it is critical to continue 
reducing the backlog and the time it takes to complete a claim, VBA 
must refocus on completing claims accurately the first time.
    In addition, VBA has a backlog of non-rating related claims, such 
as for dependency status changes, that must also be addressed in a 
timely manner. While continued advancements in the functionality of e-
Benefits and other IT systems have allowed veterans and their 
representatives to directly make dependency changes more quickly, this 
non-rating related workload is too often given low priority status in 
Regional Offices. VBA must provide the resources and attention 
necessary to consistently complete this work in a timely manner.
    It is also critical that VBA have sufficient funding for IT 
development and maintenance. In particular, VBA must devote additional 
resources to stakeholder IT enhancements in order to allow VSOs to more 
efficiently submit and review claims they represent. This will not only 
provide better service to veterans, it will also reduce some of the 
burden and workload that would otherwise fall on VBA personnel.
    Another major driver of VBA workload is appeals processing. There 
were approximately 470,000 pending appeals of claims decisions at 
various stages between VBA and the Board of Veterans Appeals (Board), 
with approximately 350,000 requiring further processing at VBA Regional 
Offices.
    Last year, Congress approved the Veteran Appeals Improvement and 
Modernization Act (P.L. 115-55) in order to help streamline the appeals 
process and provide better, timelier decisions for veterans. In 
November, VBA began early implementation of the law through the Rapid 
Appeals Modernization Program (RAMP) pilot that invites veterans with 
pending appeals to opt into the new system through the either the 
Higher Level Review or Supplemental Claim option. RAMP may have the 
effect of redirecting some workload from the Board back to VBA; 
however, once implemented, the new law will also eliminate many of the 
current appeal processes that take place at the Agency of Original 
Jurisdiction (AOJ), such as Statements of Case, and Form 9 
Certification.
    Over the past several years, VA has requested, and Congress has 
provided, additional funding to increase staffing at VBA to address the 
claims backlog. However, there have not been commensurate increases in 
funding to address the backlog of appeals pending inside VBA.
    For FY 2019, the IBVSOs recommend an additional 900 FTEE for VBA. 
Of those, 500 should be allocated to the Compensation Service to 
address the pending and future appeals workload; another 350 should be 
allocated to address the growing backlog of non-rating related work, 
such as dependency claims; and 50 should be allocated to the fiduciary 
program to address increased workload in recent years, particularly 
related to veterans participating in VA's Caregiver Support programs. A 
July 2015 VA Inspector General report on the fiduciary program found, 
``.Field Examiner staffing did not keep pace with the growth in the 
beneficiary population, [and] VBA did not staff the hubs according to 
their staffing plan..'' Last year the IBVSOs recommended 100 additional 
FTEE to address this problem; however, since VBA reallocated an 
additional 51 FTEE to the fiduciary program this year, the IBVSOs have 
reduced our recommendation to 50 new FTEE for FY 2019.
    Finally, as the Veterans Appeals Improvement and Modernization Act 
of 2017 continues to be fully implemented, including RAMP, VBA must 
develop more accurate workload, production and staffing models in order 
to accurately forecast future VBA resource requirements.

VR&E Service Personnel           143 New FTEEs           $18 million

    The Vocational Rehabilitation and Employment Service (VR&E), also 
known as the VetSuccess program, provides critical counseling and other 
adjunct services necessary to enable service disabled veterans to 
overcome barriers as they prepare for, find, and maintain gainful 
employment. VetSuccess offers services on five tracks: re-employment, 
rapid access to employment, self-employment, employment through long-
term services, and independent living.
    An extension for the delivery of VR&E assistance at a key 
transition point for veterans is the VetSuccess on Campus (VSOC) 
program deployed at 94 college campuses. Additional VR&E services are 
provided at 71 select military installations for active duty 
servicemembers undergoing medical separations through the Department of 
Defense and VA's joint Integrated Disability Evaluation System (IDES).
    Over the past four years, program participation has increased by an 
estimated 16.8 percent, while VR&E staffing has risen just 1.8 percent. 
VA projects program participation will increase another 3.1 percent in 
FY 2019, and it is critical that sufficient resources are provided not 
only to meet this rising workload, but also to expand capacity to meet 
the full, unconstrained demand for VR&E services.
    In 2016, Congress enacted legislation (P.L. 114-223) that included 
a provision recognizing the need to provide a sufficient client-to-
counselor ratio to appropriately align veteran demand for VR&E 
services. Section 254 of that law authorizes the Secretary to use 
appropriated funds to ensure the ratio of veterans to Vocational 
Rehabilitation Counselors (VRC) does not exceed 125 veterans to one 
full-time employment equivalent. Unfortunately, for the past three 
years, VA has requested no new personnel for VR&E to reach this ratio.
    In order to achieve the 1:125 counselor-to-client ratio established 
by Congress, the IBVSOs estimate that VR&E will need another 143 FTEE 
in FY 2019 for a total workforce of 1,585, to manage an active caseload 
and provide support services to almost 150,000 VR&E participants. At a 
minimum, three-quarters, of the new hires should be VRCs dedicated to 
providing direct services to veterans.

General Administration

  
 
            FY 2019 IB Recommendation                    $355 million
------------------------------------------------------------------------
       FY 2019 Administration Request                    $368 million
------------------------------------------------------------------------
FY 2018 Estimated Final Appropriation                    $330 million
 

    The General Administration account is comprised of 10 primary 
divisions. These include the Office of the Secretary; the Office of the 
General Counsel; the Office of Management; the Office of Human 
Resources and Administration; the Office of Enterprise Integration; the 
Office of Operations, Security and Preparedness; the Office of Public 
Affairs; the Office of Congressional and Legislative Affairs; and the 
Office of Acquisition, Logistics, and Construction; and the Veterans 
Experience Office (VEO). This marks the first year that the VEO has 
been included in the divisions of General Administration. Additionally, 
a number of the divisions reflect changes to the structure and 
responsibilities of those divisions. For FY 2019, the IB recommends 
approximately $355 million, an increase of more than $25 million over 
the FY 2018 estimated level. This increase primarily reflects an 
increase in current services based on the impact of uncontrollable 
inflation across all of the General Administration accounts.

Board of Veterans' Appeals

 
 
 
 
            FY 2019 IB Recommendation                    $168 million
------------------------------------------------------------------------
       FY 2019 Administration Request                    $175 million
------------------------------------------------------------------------
FY 2018 Estimated Final Appropriation                    $166 million
 

    With the enactment of the Veterans Appeals Improvement and 
Modernization Act (P.L. 115-55), the Board in 2018 will be developing 
and implementing the new appeals system scheduled to begin in February 
2019. Once fully implemented, the Board will operate five separate 
dockets concurrently, which will require new training and new IT 
functionality to manage this workload. The Board has presented its 
implementation plans to Congress and must adhere to the timelines laid 
out in order to finalize new regulations and prepare its workforce. In 
addition, sufficient IT resources must be provided to the Board to 
complete development of new workload management tools.
    Once the new appeals system is stood up in 2019, overall workload 
coming into the Board is expected to begin leveling off, or perhaps 
begin to decrease, as veterans take advantage of the expanded options 
to resolve appeals at the AOJ level. Thus, it is too early to project 
whether the Board will require more or less resources in its future 
state.
    For FY 2018, the Board is projecting that it will produce 81,000 
decisions, the highest total in the Board's history, though there will 
still remain a significant backlog of appeals in the pipeline. VA's 
budget submission for FY 2018 requested funding to increase FTEE levels 
to 1,050, continuing staffing increases in recent years to expand 
capacity and allow the Board to address both the backlog of legacy 
appeals and the transition to the new appeals system.
    For FY 2019, the IBVSOs do not recommend any additional staffing 
increases at the Board; however, it is critical that the Board complete 
the hiring and training of new personnel as rapidly as possible. 
Further, it will be critical for VA and Congress to carefully and 
regularly monitor workload, timeliness, quality and other metrics to 
ensure that the Board is and remains appropriately staffed in the 
future.

Departmental Administration and Miscellaneous Programs

                         Information Technology
 
 
 
            FY 2019 IB Recommendation                   $4.10 billion
                     IT Modernization                   $1.60 billion
                                Total                   $5.70 billion
------------------------------------------------------------------------
       FY 2019 Administration Request                   $4.18 billion
                     IT Modernization                   $1.21 billion
                                Total                   $5.39 billion
------------------------------------------------------------------------
FY 2018 Estimated Final Appropriation                   $4.06 billion
 

    In contrast to significant department-level IT failures, the 
Veterans Health Administration (VHA) over more than 30 years 
successfully developed, tested, and implemented a world-class 
comprehensive, integrated electronic health record (EHR) system. The 
current version of this EHR system, based on the VHA's self-developed 
VistA public domain software, sets the standard for EHR systems in the 
United States and was a trailblazer for years. However, parts of VistA 
require either modernization or replacement. For example, one of its 
component parts, the outdated scheduling module, contributed to VA's 
recent access to care crisis. According to VA, this module is being 
replaced on an expedited basis.
    For FY 2019, the IBVSOs recommend approximately $4.1 billion for 
the administration of the VA's IT program. While this recommendation 
includes no new funding above the planned current services level, we 
remind Congress of the need to sustain VistA for an estimated 7-10 
years after initial operating capabilities is attained at initial sites 
for IT Modernization proposed by VA. Significant resources have already 
been invested in VA's IT programs in recent years, and we believe 
proper allocation of existing resources can allow VA to fulfill its 
missions while modernizing its systems.
    Moreover, Public Law 115-48, the Forever GI Bill, authorized $30 
million in FY 2018 and FY 2019 to carry out IT changes and improvements 
to facilitate timely adjudication of GI Bill applications. IT 
improvements are vital to the proper implementation of the Forever GI 
Bill, and the IB recommends Congress appropriates the previously 
authorized $30 million.

Electronic Health Care Record Modernization.

    In testimony before the House Appropriations Subcommittee on 
Military Construction, Veterans' Affairs, and Related Agency, VA 
Secretary David J. Shulkin reported the decision to adopt the same 
electronic health care record as the Department of Defense will cost VA 
approximately $16 billion over the next 10 years. In the same hearing 
Secretary Shulkin indicated VA would transfer $782 million from both 
the Office of Information and Technology (OI&T) and Medical Care 
accounts to fund efforts related to the EHR modernization.
    VA's FY 2019 budget requests includes establishing a Veterans 
Electronic Health Record account and has reserved $782 million of FY 
2108 funds to transfer in this new account. In addition, VA is 
requesting $1.2 billion in resources to modernize its EHR system. The 
IBVSOs believe such funds must be appropriated by Congress specifically 
for the EHR modernization instead of defunding other programs and 
priorities. To ensure VA properly uses its IT funds, the IBVSOs urge 
Congress to establish and monitor a separate appropriations account for 
VA's EHR modernization. The IBVSO's recommend Congress appropriate $1.6 
billion for VA's EHR modernization account in FY 2019.

National Cemetery Administration

 
 
 
 
            FY 2019 IB Recommendation                    $311 million
------------------------------------------------------------------------
       FY 2019 Administration Request                    $316 million
------------------------------------------------------------------------
FY 2018 Estimated Final Appropriation                    $306 million
 

    The National Cemetery Administration (NCA), which receives funding 
from eight appropriations accounts, administers numerous activities to 
meet the burial needs of our nation's veterans.
    In a strategic effort to offer all veterans burial options within 
75 miles of their home, the NCA continues to expand and improve the 
national cemetery system, by adding new and/or expanded national 
cemeteries. Due to a continued increase in demand for burial space 
which is not expected to peak until 2022, NCA must continue to expand 
national cemeteries and provide more burial options for veterans. This 
much needed expansion of the national cemetery system will help to 
facilitate the projected increase in annual veteran interments and will 
simultaneously increase the overall number of graves being maintained 
by the NCA to 3.7 million in 2018 and 4 million by 2021.
    The IBVSOs strongly believe that VA national cemeteries must honor 
the service and fully supports NCA's National Shrine initiative which 
ensures our nation's veterans have a final resting place deserving of 
their sacrifice to our nation. The IBVSOs also support NCA's Veterans 
Legacy Program, which helps educate America's youth of the history of 
national cemeteries and the veterans they honor.
    In order to minimize the dual negative impacts of increasing 
interments and limited veteran burial space, the NCA needs to:

      Continue developing new national cemeteries;
      Maximize burial options within existing national 
cemeteries;
      Strongly encourage the development of state veteran 
cemeteries; and
      Increase burial options for veterans in highly rural 
areas.

Budgetary Resources for NCA Programs

    With the above considerations in mind, The Independent Budget 
recommends $311 million for FY 2019 for the Operations & Maintenance of 
the NCA.

Office of the Inspector General

 
 
 
 
            FY 2019 IB Recommendation                    $168 million
------------------------------------------------------------------------
       FY 2019 Administration Request                    $172 million
------------------------------------------------------------------------
FY 2018 Estimated Final Appropriation                    $164 million
 

    We believe that the work requirements assigned to the Office of 
Inspector General (OIG) have placed it under great stress and 
potentially stretched it beyond its capacity. That being said, the 
IBVSOs believe that the office does not warrant a staffing increase at 
this time. In light of the substantial increase the OIG received in 
FY2016, the IB recommends funding of approximately $168 million, based 
on current services for FY2019.

Construction Programs

                           Major Construction
 
 
 
            FY 2019 IB Recommendation                   $1.73 billion
------------------------------------------------------------------------
       FY 2019 Administration Request                   $1.13 billion
------------------------------------------------------------------------
FY 2018 Estimated Final Appropriation                   $0.51 billion
 

    Each year VA outlines its current and future major construction 
needs in its annual Strategic Capital Investment Planning (SCIP) 
process. In its FY 2018 budget submission, VA projected it would take 
between $55 billion and $67 billion to close all current and projected 
gaps in access, utilization and safety, including activation costs. 
Currently, VA has 21 major active major construction projects, which 
have been partially funded or funded through completion.
    In its FY 2018 Budget Request, VA requested and Congress intends to 
appropriate a significant reduction in funding for major construction 
projects - between $410 million and $512 million. While these funds 
would allow VA to begin construction on key projects, many other 
previously funded sites still lack the funding for completion. One of 
these projects was originally funded in FY 2007, while others were 
funded more than five years ago but no funds have been spent on the 
projects to date. Of the 21 projects on VA's partially funded VHA 
construction list, eight are seismic in nature. Seismic projects are 
critical to ensuring VA's facilities do not expose veterans to 
additional risks during an earthquake or other seismic events.
    It is time for the projects that have been in limbo for years, or 
that present a safety risk to veterans and employees, be put on a 
course to completion within the next five years. To accomplish this 
goal, the IBVSOs recommend that Congress appropriate $1.73 billion for 
FY 2019 to 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.
    The IBVSOs also recommend, as outlined in its Framework for 
Veterans Health Care Reform, that VA realign its SCIP process to 
include public-private partnerships and sharing agreements for all 
major construction projects to ensure future major construction needs 
are met in the most financially sound manner.

Research Infrastructure

    State-of-the-art research requires state-of-the-art technology, 
equipment and facilities. For decades, VA construction and maintenance 
appropriations have not provided the resources VA needed to maintain, 
upgrade or replace its aging research laboratories and associated 
facilities. The average age of VA's research facilities is more than 50 
years old, and those conditions are substandard for state of the art 
research.
    The IBVSOs believe that Congress must ensure VA has the resources 
it needs to continue world class research that improves the lives of 
veterans and helps recruit and retain high-quality health care 
professionals to work at VA. To do so, Congress must designate funds to 
improve specific VA research facilities in FY 2019 and in subsequent 
years. In order to begin to address these known deficits, the IBVSOs 
recommend Congress approve at least $50 million for up to five major 
construction projects in VA research facilities.

Minor Construction

 
 
 
 
            FY 2019 IB Recommendation                    $761 million
------------------------------------------------------------------------
       FY 2019 Administration Request                    $706 million
------------------------------------------------------------------------
FY 2018 Estimated Final Appropriation                    $343 million
 

    In FY 2018, VA requested $372 million for minor construction 
projects. Currently, approximately 900 minor construction projects need 
funding to close all current and future year gaps within the next 10 
years. To complete all of these current and projected projects, VA will 
need to invest between $6.7 and $8.2 billion over the next decade.
    To ensure that VA funding keeps pace with all current and future 
minor construction needs, the IBVSOs recommend that Congress 
appropriate an additional $761 million for minor construction projects. 
It is important to invest heavily in minor construction because these 
types of projects can be completed faster than other capital 
infrastructure projects, and have a more immediate impact on services 
for veterans.

Grants for State Extended-Care Facilities
(State Home Construction Grants)

 
 
 
 
            FY 2019 IB Recommendation                    $200 million
------------------------------------------------------------------------
       FY 2019 Administration Request                    $150 million
------------------------------------------------------------------------
FY 2018 Estimated Final Appropriation                    $110 million
 

    Grants for state extend-care facilities, commonly known as state 
home construction grants, are a critical element of federal support for 
state veterans' homes. The state veterans' home program is a very 
successful federal-state partnership in which VA and states share the 
cost of constructing and operating nursing homes and domiciliaries for 
America's veterans. State homes provide more than 30,000 nursing home 
and domiciliary beds for veterans, their spouses and gold-star parents 
of deceased veterans. Overall, state homes provide more than half of 
VA's long-term-care workload, but receive less than 22 percent of VA's 
long-term-care budget. VA's basic per diem payment for skilled nursing 
care in state homes is significantly less than comparable costs for 
operating VA's own long-term-care facilities. This basic per diem paid 
to state homes covers approximately 30 percent of the cost of care, 
with states responsible for the balance, utilizing both state funding 
and other sources.
    States construction grants help build, renovate, repair, and expand 
both nursing homes and domiciliaries, with states required to provide 
35 percent of the cost for these projects in matching funding. VA 
maintains a prioritized list of construction projects proposed by state 
homes based on specific criteria, with life and safety threats in the 
highest priority group. Only those projects that already have state 
matching funds are included in VA's Priority List Group 1 projects, 
which are eligible for funding. Those that have not yet received 
assurances of state matching funding are put on the list among Priority 
Groups 2 through 7.
    With almost $1 billion in state home projects still in the 
pipeline, the IBVSOs recommend $200 million for the state home 
construction grant program to address a portion of the projects 
expected to be on the FY 2019 VA Priority Group 1 List when it is 
released this year.

Grants for State Veterans Cemeteries

 
 
 
 
            FY 2019 IB Recommendation                     $51 million
------------------------------------------------------------------------
       FY 2019 Administration Request                     $45 million
------------------------------------------------------------------------
FY 2018 Estimated Final Appropriation                     $45 million
 

    The State Cemetery Grant Program allows states to expand veteran 
burial options by raising half the funds needed to build and begin 
operation of state veterans cemeteries. NCA provides the remaining 
funding for construction and operational funds, as well as cemetery 
design assistance. Funding additional projects in FY 2019 in tribal, 
rural and urban areas will provide burial options for more veterans and 
complement VA's system of national cemeteries. To fund these projects, 
Congress must appropriate $51 million.

                                 
                        Questions For The Record

                               HVAC TO VA
    Questions for the Record
    House Committee on Veterans' Affairs
    "U.S. Department of Veterans Affairs Budget Request for Fiscal Year 
2019"

    February 15, 2018
    Questions for the Record from Chairman Roe:
    Question 1: Current appropriations into the Choice Program fund are 
projected to last through the end of fiscal year 2018. How much 
additional funding is needed to sustain the program through the 
enactment and implementation of community care consolidation 
legislation, and is all such funding provided in the Bipartisan Budget 
Act of 2018, P.L. 115-123 and its resulting allocations?
    a. Please answer the above questions assuming a March 2019 
implementation.
    b. Please answer the above questions assuming any other 
implementation date that VA believes is appropriate or may become 
appropriate.

    VA Response: The Bipartisan Budget Act of 2018 provided the 
necessary funds to support the Veterans Choice Program with mandatory 
resources through May of 2019. VA strongly supports the MISSION Act and 
thanks Congress for its enactment of this top Administration priority. 
The fiscal year (FY) 2019 Budget fully funded Community Care, but 
assumed enactment by February 2018 of community care consolidation 
legislation (CARE, as proposed by VA). Due to the delay in enactment, 
VA will require an additional $1.6 billion in FY 2019 for VA's 
traditional community care program. In addition, the final MISSION Act 
included expanded eligibility and new programs that were not included 
in the VA's FY 2019 or FY 2020 Advanced Budget Request.

    Question 2: Assuming enactment and implementation of community care 
consolidation legislation, considering VA's budget request for fiscal 
year 2019 appropriations, fiscal year 2020 advance appropriations, and 
additional funding provided in the Bipartisan Budget Act and its 
resulting allocations, would community care programs be fully funded in 
fiscal years 2019 and 2020?

    VA Response: The FY 2019 Budget fully funded Community Care, but 
assumed enactment by February 2018 of CARE legislation. Due to the 
delay in enactment, VA will require an additional $1.6 billion in FY 
2019 for VA's traditional community care program. This does not include 
the additional funding due to new unfunded MISSION Act programs and 
expanded eligibility.

    Question 3: Many of the figures in the Department's budget proposal 
assume VA legislative proposals have already been enacted.

    a. If all legislative proposals are not enacted by the beginning of 
fiscal year 2019, assuming the proposed funding levels were enacted, 
would those funding levels be sufficient and those budget projections 
remain accurate?

    VA Response: There are a few proposals that, with delayed 
enactment, will increase costs. One that is particularly impactful and 
therefore concerning is a provision enacting Medicare rates for the new 
Community CARE program. Delay would increase VA's costs for its 
traditional community care program by approximately $1.6 billion in FY 
2019 (as noted above in the response to Roe, Question 1).

    b. If the community care consolidation proposal is not enacted by 
the beginning of fiscal year 2019, assuming the proposed funding levels 
were enacted, would those funding levels be sufficient and those budget 
projections remain accurate?

    VA Response: The MISSION Act provided the necessary funds to 
support the Veterans Choice Program with mandatory resources through 
May of 2019. VA strongly supports the MISSION Act and thanks Congress 
for its enactment of this top Administration priority. The FY 2019 
Budget fully funded Community Care, but assumed enactment by February 
2018 of CARE legislation. Due to the delay in enactment, VA will 
require an additional $1.6 billion in FY 2019 for VA's traditional 
community care program. In addition, the final MISSION Act included 
expanded eligibility and new programs that were not included in the 
VA's FY 2019 or FY 2020 Advanced Budget Request.

    c. If the legislative proposals regarding construction and leasing 
thresholds and joint facilities authorities are not enacted by the 
beginning of fiscal year 2019, assuming the proposed funding levels 
were enacted, would those funding levels be sufficient and those budget 
projections remain accurate?

    VA Response: Yes, even if the legislative proposals are not enacted 
by FY 2019, the funding levels would be sufficient to cover cost for 
these programs.

    Question 4:  VA's budget request represents a historic increase for 
the Department, larger in percentage terms than for any other agency. 
The budget narrative mentions "modernization reforms and other 
efficiencies." What are the top 10 proposed reforms or efficiencies 
that will produce savings, ranked in order of dollar value? Such 
savings should not be offsets for other spending increases but rather 
efficiencies, programmatic, administrative, or otherwise, that will 
produce tangible savings measured against current expenditures.

    a. How will veterans experience the proposed reforms, efficiencies, 
and savings, and how will VA services be impacted?

    b. How will the reforms, efficiencies, and savings impact access to 
care?

    VA Response: VA is modernizing to improve performance and to better 
serve Veterans, their families, caregivers, and survivors while being 
good stewards of tax payer dollars. Guided by both the Secretary's 
priorities and the President's Executive Order (EO), "Comprehensive 
Plan for Reforming the Federal Government and Reducing the Federal 
Civilian Workforce," VA is focused on reducing bureaucracy; simplifying 
core functions; increasing accountability; encouraging bold and 
decisive leadership; streamlining services and programs by eliminating 
redundancies; and empowering employees to do the right things for 
Veterans.

    In developing this plan, VA reviewed numerous studies and 
assessments that project potential cost savings or avoidance as a 
result of these modernization efforts. While we are still evaluating 
the tangible and intangible benefits associated with each initiative, 
we believe there are specific cost reduction opportunities in several 
areas, including our contact centers and supply chain as detailed 
below.
    Modernization is not a one-time effort to make updates: these are 
significant changes that will advance internal and external operations. 
The following provides insight into how the Department is modernizing 
to improve efficiency and delivery of care and services for Veterans.

    1. Telehealth: VA will continue to leverage Telehealth technologies 
to enhance accessibility, capacity, and quality of VA healthcare. By 
expanding Telehealth capabilities, VA seeks to increase access to 
services for Veterans living in rural and remote locations, increase 
availability of specialty services, and reduce the volume of onsite 
patient care.

    2. Community Care: VA has submitted, and Congress has passed a plan 
for consolidating several programs that provide community care through 
non-VA providers into a new, single VA Community Care program in FY 
2018. This will expand access to care by allowing Veterans to obtain 
health care services outside the Veterans Health Administration (VHA) 
if those services are not available or readily accessible within VHA. 
Consolidating programs under a single executive will improve 
accountability and provide VA with the ability to direct funding for 
non-VA care to emerging high-priority needs as appropriate.

    3. Change in Timing of Obligations: The FY 2019 Budget includes a 
one-time savings of $1.8 billion from changing the time of community 
care obligation. The proposed accounting change will mean that 
obligations will be recorded at the time claims are processed and 
approved, thereby eliminating the uncertainty regarding the actual 
total obligations against the program. The Department believes that 
this change in obligation procedure will improve program management and 
the ability to forecast and justify budget requirements.

    4. Appeals Modernization: Working collaboratively with stakeholders 
to implement legislative change by February 2019, Veterans Benefits 
Administration (VBA) and the Board of Veteran Appeals (Board) will 
address the current pending inventory of legacy appeals and implement a 
streamlined process. This effort will shorten the time to process 
appeals; increase transparency of the appeal process; and reduce the 
amount of time and resources required to process appeals.

    5. Suicide Prevention: Reducing suicide among Veterans is VA's top 
clinical priority and VA is implementing a comprehensive strategy 
(e.g., leveraging Federal, state, local, private, services and 
benefits) to reduce suicide from its current rate of approximately 20 
Veterans per day.

    6. IT Modernization: This initiative will replace legacy IT systems 
and infrastructure with modern technologies and applications in order 
to overcome security and business requirement deficiencies. VA 
currently has more than 130 legacy systems that place the Department at 
considerable risk of being unable to deliver care and benefit services. 
This effort will increase responsiveness, agility and flexibility while 
reducing recurring costs necessary to sustain outdated, legacy systems.

    7. Electronic Health Record Modernization (EHRM): On May 17, 2018, 
VA signed a contract with Cerner to modernize its Electronic Health 
Record (EHR) by replacing the legacy VISTA system and adopting/
deploying a common system being deployed by the Department of Defense 
(DoD). It is one of the largest IT contracts in the federal government, 
with a ceiling of $10 billion over 10 years. When complete, this will 
increase interoperability, accuracy of information, responsiveness and 
access to care, reliability, transparency and accountability while 
reducing improper payments.

    8. Financial Management Business Transformation: VA's Financial 
Management Business Transformation (FMBT) will replace VA's legacy 
Financial Management System by providing a modern, integrated financial 
management and acquisition solution. FMBT will increase the 
transparency, accuracy, timeliness, and reliability of financial and 
acquisition information across VA, resulting in improved fiscal 
accountability to American tax payers and an increased standard of 
excellence for Veterans and those who serve them.

    9. Navigator - Contact Center Modernization: VA is transitioning 
its contact centers away from antiquated, fragmented, legacy systems to 
an agile, innovative cloud solution to optimize responses to the 140 
million calls flooding VA's 1,000+ toll-free and direct dial numbers 
annually. Specifically, best practices for enterprise contact centers 
include use of a tiered structure to drive calls to the least expensive 
tier capable of responding to the callers' needs. By implementing such 
a structure VA expects to realize enterprise operating cost avoidance 
for labor standardization and first call resolution that exceeds $400 
million annually. Additionally, a centralized source of data and 
interaction history will enable VA to make data-driven, Veteran-focused 
improvements.

    10. Improving Foundational Business Functions:  VA is restructuring 
its central office functions to become more agile and responsive. This 
includes consolidating redundant functions, delayering and pushing 
decision rights to the lowest appropriate level, improving processes 
and technology, and redirecting resources from headquarters to the 
field to support delivery of services to Veterans. The following three 
examples illustrate progress on this initiative:

    a. Supply Chain Modernization: Modernizing VA supply chain to a 
streamlined, responsive enterprise supply chain will significantly 
enhance the delivery of care and service in a timely fashion. Applying 
the insights from the Commission on Care (e.g., recommendation #8, 
"Transform the management of the supply chain", which described the 
organizational structure as "chaotic" and noted that "processes are not 
aligned to business functions."), and several independent analyses, VA 
achieved cost avoidance in excess of $150 million in each of last 2 
FYs. This effort will drive accountability and consistency across VA, 
gaining efficiencies that better serve Veterans, taxpayers, and VA 
clinicians while contributing to improvements in patient safety, 
quality of care, access to care, and allocation of clinical resources.

    b. Human Resources (HR) Modernization: VA is seeking to gain 
efficiencies by consolidating HR transactional service capabilities; 
business functions and upgrading HR information technology systems. 
This will improve performance of HR functions and result in 
efficiencies through process consolidation and reform.

    c. Construction and Facilities Management: VA is assessing options 
to establish a unified, fully integrated enterprise construction and 
facilities management function through the realignment of operational 
components currently dispersed among 7 offices and 19 sub-offices. This 
initiative is in accordance with findings and recommendations from the 
Commission on Care Independent Assessment Section K, United States Army 
Corps of Engineers and Defense Health Agency reviews. The positive 
impacts include reduction of needless bureaucratic hurdles and 
resultant wasted staff time and effort. In addition, the referenced 
studies indicate that (depending upon the ultimate realignment) 
considerable savings are possible via: appropriate capital facilities 
inventory; elimination of redundant staff; streamlined procedures; 
reduced facility maintenance costs; discretionary redirection of 
facility management savings, and more. These effects will allow for 
improvements in delivery speed in providing modern efficacious 
facilities for Veterans' point of health-care delivery. Though it will 
require time, a direct benefit to Veterans is that VA will be more 
enabled to strategically address the $19 billion Facility Condition 
Assessment backlog of deficient findings. The long-term result will be 
more reliable, better designed facilities allowing for better patient 
access, scheduling and throughput.

    While each initiative is intended to ultimately benefit Veterans, 
the following table summarizes which initiatives will have a direct 
impact to Veterans and access to care.

 
----------------------------------------------------------------------------------------------------------------
          Modernization Initiatives               Direct Impact to Veterans           Direct Access to Care
----------------------------------------------------------------------------------------------------------------
                             Telehealth                                 X                                 X
----------------------------------------------------------------------------------------------------------------
                         Community Care                                 X                                 X
----------------------------------------------------------------------------------------------------------------
         Change in Timing of Obligation
                  Appeals Modernization                                 X
----------------------------------------------------------------------------------------------------------------
                     Suicide Prevention                                 X                                 X
----------------------------------------------------------------------------------------------------------------
                       IT Modernization                                 X                                 X
----------------------------------------------------------------------------------------------------------------
               Electronic Health Record                                 X                                 X
----------------------------------------------------------------------------------------------------------------
Financial Management Business Transformation
                              Navigator                                 X                                 X
----------------------------------------------------------------------------------------------------------------
           Delayering VA Central Office                                 X                                 X
----------------------------------------------------------------------------------------------------------------
                      -HR Modernization
            -Supply Chain Modernization                                                                   X
----------------------------------------------------------------------------------------------------------------
-Construction and Facilities Management                                                                   X
----------------------------------------------------------------------------------------------------------------

    Question 5: Written testimony indicated VA has taken steps to 
achieve mandatory savings of $30 billion over the next 10 years. Is 
that a $30 billion savings or a slowing of the rate of spending growth 
of $30 billion over the next 10 years?

    VA Response: The reduction in mandatory spending will be achieved 
through administrative reforms that will result achieve $30 billion in 
savings beginning in FY 2021.

    Question 6: Please detail how the growth rate of VA's mandatory 
expenditures will be reduced.

    VA Response: Given medical advancements in treatment and other 
technologies, there has been a decrease in the impacts of certain 
disabilities on the lives of many Veterans. VA will realize savings by 
promoting the well-being and enhanced functioning of Veterans and 
conducting administrative reviews of the disability compensation 
criteria.

    Question 7: Under the proposed Electronic Health Records 
Modernization (EHRM) program and its contract which has now been 
essentially completely negotiated, please describe the end states of 
interoperability with the Defense Department and with VA community 
providers which will be achieved at the end of two, five, and ten 
years.

    VA Response: VA will leverage a business and technical solution 
that will help to ensure the health and safety of Veterans through a 
new EHR interoperable with DoD and community providers. VA will 
continue to work closely with DoD to implement their lessons learned 
and optimize VA's prospective schedule. At the end of implementation, 
VA will achieve interoperability across the Department, between DoD, 
and amongst VA community care providers. VA is cautiously balancing the 
timeline of implementation of the EHR with risk to cost, schedule, and 
performance objectives.

    Question 8: When does VA project to reach a "break-even point" 
after completing EHRM, comparing the costs of carrying out the program 
and sustaining its future-state systems against the known costs of 
sustaining current systems, including VistA, CPRS, and all others which 
are slated for replacement?

    VA Response: The EHRM Program Executive Office (PEO) is planning 
efforts to generate the data needed to conduct a "break-even point" 
analysis. These types of analyses are complex. These efforts include 
gathering the data needed to estimate EHRM's total life-cycle costs to 
help the program understand the costs that will have an impact and when 
these costs will occur. In addition, PEO is working through plans to 
understand the regional aspects of nationally deployed systems that can 
be depreciated and estimating the cost savings as a result. Finally, 
PEO will collaborate with counterparts in the Office of Information & 
Technology to understand and validate current development, maintenance 
and sustainment costs.

    Question 9: In what year does VA expect completely to phase out 
VistA and CPRS, assuming the EHRM program's scheduled progress is 
achieved through its completion?

    VA Response: We expect VistA to operate in parallel with the Cerner 
Millennium solution for a period of time that has yet to be determined. 
Our Initial Operating Capability (IOC) site implementation in the 
Pacific Northwest over the first 18 months of EHR implementation 
following contract award will solidify our "pivot plan" for when we 
will be able to transition from VistA-delivered functionality at a site 
to the new EHR solution without compromising our Veteran care 
objectives. These findings at IOC will be used to support full 
enterprise deployment timelines and corresponding site transitions from 
VistA to the state-of-the-market EHR.

    Question 10: The budget proposal includes funding within the 
Electronic Health Record Modernization Infrastructure Support line item 
for continued VistA Standardization. How will VA ensure the ongoing 
VistA standardization effort will not impede progress to implement the 
Cerner EHR?

    VA Response: It is expected that the current VistA Standardization 
work will be completed at the beginning of FY 2019. Furthermore, VA 
anticipates additional work on a limited scope for data dictionary 
normalization as a part of the VistA Standardization work. The funding 
would also address some potential portions of VistA and CPRS that will 
need to be standardized with the new commercial EHR. This would provide 
best practices in certain workflows from the new EHR to VistA and CPRS.

    Question 11: As presented in VA's annual agency financial report, 
the Department's total budgetary resources in fiscal year 2017 were 
approximately $229 billion. Assuming the Department's total FY 2019 
request of $198.6 billion is granted, how much are the total budgetary 
resources expected to be?

    VA Response: The $229 billion in total budgetary resources 
identified in the annual Agency Financial Report (AFR) represents the 
Department's total spending authority in FY 2017. In addition to 
appropriations, this figure includes collections from revolving funds 
(Medical Care Collections Fund [MCCF], Canteen, Supply, Franchise, 
others), unobligated balances, including VA' mandatory programs, and 
borrowing authority.

    VA's 2019 President's Budget request complies with scoring 
practices established by the Office of Management and Budget (OMB). The 
AFR includes off-budget authority and unobligated balances, which are 
identified in the budget. Therefore, the President's Budget is the most 
accurate representation of VA's request for new appropriations in FY 
2019.

    Question 12: VA previously proposed recording community care 
obligations at the time of payment, rather than estimating them in 
advance and then reconciling actual expenditures. VA has determined it 
has the authority, without legislation, to start doing so at the 
beginning of fiscal year 2019. The proposed community care budget 
assumes a favorable, one-time change in the timing of obligations worth 
$1.8 billion. Please explain in detail how this number was developed.

    VA Response: VA used the historical FY 2015 and FY 2016 inpatient 
and outpatient payment data to determine the FY 2019 $1.8 billion one-
time timing of obligations savings. VA analyzed that on average, it 
takes about 3 months from the time VA receives a claim from community 
care providers to adjudicate and to make final payments to its 
community care providers. VA also determined that 92 percent of the 
accrued obligations (those not executed in the current fiscal year) 
resulted in a payment within 2 years. VA anticipates minimal 
obligations during the first 3 months of FY 2019, the first year of the 
transition to recording the obligation at the time of adjudication. VA 
will continue to process payments (expenditures) for care obligated 
prior to FY 2019 using the previous methodology (obligate at time of 
authorization) to reconcile actual expenditures.

    Question 13: The proposed community care budget relies on $1.38 
billion of "transfers, unobligated balances, and recoveries" in fiscal 
year 2019. Please explain what this number contains and how each 
element of the overall total was developed.

    VA Response: Please see the chart below.


                      Dollars in Thousdands ($000)
------------------------------------------------------------------------
               Description                      2019 Revised Request
------------------------------------------------------------------------
                      Transfers (+/-)
   Medical Community Care Transfer to                       ($39,334)
             Medical Facilities (0162)
------------------------------------------------------------------------
Medical Community Care Transfer to FHCC                     ($26,504)
                                (0169)
------------------------------------------------------------------------
Transfer from Medical Services (0160) to                     $446,000
         Medical Community Care (0140)
------------------------------------------------------------------------
                             Subtotal                        $380,162
                 Unobligated Balances
            Unobligated Balance (SOY)                      $1,000,000
------------------------------------------------------------------------
           Unobligated Balances (EOY)                              $0
------------------------------------------------------------------------
                             Subtotal                      $1,000,000
------------------------------------------------------------------------
                Prior Year Recoveries                              $0
------------------------------------------------------------------------
                                Total                      $1,380,162
------------------------------------------------------------------------

Transfer

      Proposed transfer of $39.334 million to Medical 
Facilities will support estimated obligations of $6.145 billion, which 
includes anticipated Non-Recurring Maintenance obligations of $1.446 
billion.
      Proposed transfer of $26.504 million to the Joint-DoD VA 
Medical Facility Demonstration Fund will support estimated obligations 
of $449 million.
      Transfer of $446 million from Medical Services to Medical 
Community Care will support estimated obligations of $10.515 billion. 
In FY 2019 the budget submission proposes to merge the Medical 
Community Care appropriation with the Medical Services appropriation. 
For purposes of responding to this question, Medical Community Care is 
shown separately.

Unobligated Balances

      Estimated $1 billion in funds remaining (carryover from 
FY 2018 into FY 2019) from Medical Community Care. Medical Community 
Care obligations estimate in FY 2018 is $9.363 billion. Funds will be 
utilized in FY 2019 to support Medical Community Care obligations of 
$10.515 billion.

Prior Year Recoveries

      Prior Year Recoveries estimate is $0.

    Question 14: The budget includes a legislative proposal to grant VA 
general transfer authority between discretionary accounts up to 2 
percent of the Department's total discretionary appropriations. This 
year, VA's discretionary request is a little over $83 billion, 
excluding medical care collections; 2 percent of that total equates to 
approximately $1.7 billion. Please provide examples when it has been 
necessary to transfer this much funding and complying with the existing 
congressional notification process hampered the Department's 
operations.

    VA Response: The Department's request for General Transfer 
Authority of 2 percent would provide the needed flexibility to manage 
unanticipated needs during the FY. One recent example where this 
authority would have provided the Department the flexibility to address 
unplanned requirements was the proposed transfer of funding for the EHR 
initiative. This flexibility would have allowed VA to adapt quickly to 
changing requirements and optimize resources in FY 2018 by reallocating 
under-executing requirements to the next prioritized requirement.

    Question 15: The budget proposal contains a narrative contending 
the separate Community Care account has restricted VA medical center 
directors from managing their budgets effectively. Please provide 
specific examples of this.

    VA Response: The Budget proposes to merge the Medical Community 
Care appropriation with the Medical Services appropriation, as was the 
case prior to 2017. The current multiple medical care appropriations 
structure, including mandatory and discretionary resources, presents a 
significant administrative burden to the Medical Center Directors. 
While not insurmountable, it does not permit the Medical Center 
leadership to easily leverage all the tools available for providing 
Veterans with the care they need. Having both Medical Services and 
Medical Community Care (MCC) aligned under one appropriations account 
would allow Medical Center Directors the flexibility needed to 
expediently address care-related issues in ways that are beneficial to 
our Veterans.

    1. Prior to the implementation of the MCC account, VA medical 
centers locally allocated funds between VA Medical Center (VAMC) 
salaries and care in the community, ensuring Veterans had timely access 
to care. This flexibility was lost with the creation of the MCC 
account. This proposal allows the previous flexibility while ensuring 
timely access to care and to strategically and efficiently use the 
funds. Below are specific examples.

    a. A VAMC has a physician vacancy that has been unfilled for some 
time, but is able to finally hire someone for that position. Because 
the workload associated with this new hire would have been reflected in 
community care in the recent past, the VAMC would like to move the 
funds back in-house and provide the care at lower cost, rather than 
purchasing it from the community. Under the current appropriation 
structure, moving this position from community care back into VA 
requires a time consuming transfer process, and in the interim, the 
VAMC must identify in-house funding offsets that could limit clinical 
care in another area.

    b. A rural VAMC provides 1,200 sleep studies each month through 
care in the community at a cost of $864,000 a year. Total estimated 
staffing and supply costs to bring those services in-house is estimated 
to be $450,000 a year, but the process of transferring funds between 
appropriations accounts is time consuming and administratively 
burdensome causing the medical center to purchase sleep studies in the 
community at almost twice the cost of providing the care in-house.

    c. A VAMC has sufficient operating room capacity, outpatient 
clinical space, and equipment to provide clinical services, but lacks 
the flexibility to convert community care funds to medical services 
funds in a timely manner. As a result, the operating rooms may sit idle 
since the VAMC cannot access "community care funds" to pay for these 
procedures in-house.

    2. The current multiple medical care appropriations structure also 
negatively impacts existing sharing agreements with adjacent university 
hospitals. VA sharing agreements are funded with the Medical Services 
appropriation. When medical centers exceed the annual allotted budget 
for the sharing agreement(s), the medical center is required to send 
Veterans for care in the community for the remainder of the fiscal 
year. For specialty care, such as orthopedic surgeries, the cost is 
frequently much more costly than through the sharing agreement. With a 
consolidated account, a VAMC could provide these services in-house, 
likely at a lower rate than what may be available in the community.

    3. Strategic investment in capital equipment and staffing is 
limited without the flexibility to transfer funds expeditiously between 
appropriations. With the combined appropriation, medical center 
directors would have more flexibility to reallocate the MCC funds to 
purchase necessary equipment as well as to fund necessary salaries. As 
one specific example, a VAMC currently sends out all low-dose 
Computerized Tomography scans to the community at an average cost of 
$200 a scan. The VAMC would like to realign the community care funds to 
provide this service in-house at an average cost of $125 with equipment 
and staff capacity.

    Question 16: If the Medical Services and Community Care accounts 
are merged as requested, how would VA ensure that each Veterans 
Integrated Service Networks (VISN) and VAMC allocates sufficient 
funding to community care, and does not deny veterans access to 
community providers in order to maintain their internal budgets, as 
happened not infrequently before the accounts were separated?

    VA Response: VA uses an actuarial model, the Enrollee Health Care 
Projection Model (EHCPM), to develop health care requirements for 
Veterans. The EHCPM develops estimates for both community care and care 
provided in VAMCs. If VA's proposed change were made, VA would continue 
to include separate estimates for community care funded within the 
Medical Services appropriation in the President's Budget request. VA 
would also continue to discretely account for community care 
obligations using the same underlying accounting structure currently in 
place for the separate Medical Community Care appropriation. Concurrent 
with the request to combine the Medical Services and Medical Community 
Care appropriations accounts, VA is submitting a legislative proposal 
to allow VA to use a model similar to that used for the Consolidated 
Mail Outpatient Pharmacy program, where the funds will initially reside 
with each VAMC, but will be provided by the VAMC to the Deputy Under 
Secretary for Community Care to manage during the year. Based on the 
demand for community care and the ability of the VAMC to provide more 
care in house at lower cost, the amount provided can be rapidly 
adjusted to meet changes in each VAMC's ability to provide care in-
house.

    Question 17: What is the VISN's role in making sure facilities 
within its boundaries have enough funds to cover contingencies in 
either the Medical Service or Community Care accounts?

    VA Response: The VISN is responsible for establishing emergency 
reserve funds in the Medical Service account. The reserve fund allows 
the VISN to address contingencies. VISN leadership routinely identifies 
needs/excess and realigns funds between facilities as needed.

    Question 18: How does this budget proposal contemplate absorbing 
additional demand or utilization that may result from community care 
consolidation?

    VA Response: The FY 2019 Budget request fully funded VA's Community 
Care needs consistent with the assumptions identified below.

      The FY 2019 Budget includes $14.2 billion in total 
programmatic resources after adjusting for the impact of the one-time 
change in timing of obligations.
      The Budget increases VA's ability to manage limited 
resources by funding all community care entirely with discretionary 
funds and by merging the Medical Community Care appropriation account 
with the Medical Services account. These flexibilities, combined with 
the efficiencies included in the CARE legislation, will empower VA to 
focus and manage resources without requiring subsequent bailouts.
      VA will continue to work with Congress and stakeholders 
to improve Veterans health care and maximize the quality, efficiency, 
and fiscal sustainability of VA's community health program.

    The MISSION Act provided the necessary funds to support the 
Veterans Choice Program with mandatory resources through May of 2019. 
The delay in enacting the new community care program could require an 
additional $1.6 billion in FY 2019 for VA's traditional community care 
program. In addition, the FY 2019 Budget did not include funding to 
support some of the unfunded programs included in Mission or the 
expanded eligibility.

    Question 19: The budget proposal states VISN and medical center 
leaders are being asked to assess community care options to give 
veterans greater convenience. Please provide a copy of the policy 
creating this directive and explain how it was disseminated.

    VA Response: Currently, there is no policy. However, VA facility 
and VISN leaders continue to assess options for health services that 
could be more conveniently delivered by community providers. VA leaders 
are also considering accessibility of VA facilities and convenience 
factors (like weekend hours), as they develop recommendations for 
community access to non-VA providers for Veterans in their service 
areas. Defining VA-delivered foundational services and a process for 
determining which services VA should deliver in its own facilities and 
which services VA should purchase from community providers and Federal 
partners will enable VA to provide access to high-quality care for 
Veterans by balancing care provided by VA and the community/partners 
while addressing the increasing demand for care. Increased operational 
efficiency promotes VHA's continuing commitment to its four missions:

      Education of health professionals;
      Research to advance the care of Veterans;
      Supporting our Nation's emergency preparedness and; above 
all else
      Providing the best possible care for Veterans.

    Question 20:  In this budget proposal, VA has created a ranking 
process specifically for non-recurring maintenance projects, whereas 
previously they were considered together with the minor construction 
projects. The stated goal is to give VISN directors more input. What is 
the intended outcome of this change, and how will doing so enable non-
recurring maintenance projects to be selected more accurately or 
accomplished more quickly?

    VA Response: In previous years, the budget development of the 
Strategic Capital Investment Plan (SCIP) decision criteria model was 
the same for Non-Recurring Maintenance (NRM), Minor Construction, 
Leasing, and Major Construction. The SCIP decision criteria model 
included seven primary criteria and over twenty-two sub-elements. Not 
all elements of the decision criteria model were applicable to the NRM 
program; as many of the elements were strategic in nature and could not 
be accomplished through the NRM program. Through this budget proposal a 
focused and streamlined decision criteria model was developed specific 
to the NRM program that included the following three primary criteria: 
VISN Priority, Facility Condition and Planning priorities.

    This newly developed decision criteria model provides a more 
focused request for NRM projects in 2019 and a prioritized list of NRM 
initiatives that reflect the top priority of the VISN while also 
focusing the limited NRM funding on the NRM program goals of addressing 
VHA's most pressing infrastructure needs. This change removes NRM 
project prioritization from a compiled list of all strategic 
initiatives in the Minor Construction, Major Construction, and Leasing 
programs, which approvals are based upon multiple elements not relevant 
to NRM projects. Additionally, this change allows for the focused 
criteria specific to the NRM program.

    Question 21: The budget includes two legislative proposals allowing 
expanded funding transfer authority for joint construction and 
facilities projects, with the Defense Department and other agencies. A 
version of this language also appears in VA's proposed CARE 
legislation. If enacted, how will VA ensure such funds would be spent 
effectively after they become comingled and the management and 
execution responsibility, formerly residing in VA, is divided between 
two agencies?

    VA Response: If the VA/DoD proposal is enacted, both Departments 
will utilize lessons learned from previous experiences, including the 
operation of the Captain James A. Lovell Federal Health Care Center in 
North Chicago, to ensure proper management and execution of joint 
capital projects. Prior to the implementation of the effort, VA will 
ensure appropriate financial controls are put in place to avoid 
comingling or inefficient use of funds before any funds are transferred 
between Departments.

    Question 22: The budget request includes $150 million for state 
extended care matching grants, which is expected to fund 10 grants. How 
many beds will that produce?

      a. The budget request also includes $190 million to build 
one, 120-bed community living center in Canandaigua, New York, as well 
as to renovate three buildings there. Has the Department conducted any 
formal analysis or cost-benefit study comparing the efficiency of 
producing community living and extended care beds through state grants 
compared to VA construction?

    VA Response: Canandaigua VA Medical Center does not have a 
methodology to determine how many State Veterans Home beds would be 
created by $150 million in extended care matching grants or the 
locations in which the State Veterans Home beds would be created. 
Population demographics may suggest greater need for this type of bed 
expansion in other areas of the country. The budget request is not for 
the construction of a new community living center (CLC), but is for the 
replacement of the current facilities. The Canandaigua VAMC current has 
116 operating nursing home beds on their campus, with an Average Daily 
Census for the 1st quarter of FY 2018 of 93.7. Currently, there is no 
capacity in the Canandaigua community to absorb CLC Veteran Residents 
at this time, either in the State Veterans Homes or Community Nursing 
Homes. At this time, the Canandaigua VAMC has contracts with 4 
community nursing homes (3 in Rochester, NY, and 1 in Lyons, NY). As 
with many VA CLCs, there are Veterans with medical and mental health 
co-morbidities for whom there are limited to no community options. The 
Canandaigua VAMC plans to develop this CLC as a niche with the small 
house model to assist other facilities across the New York region that 
have Veterans who are difficult to place in the community settings and 
who are residing in acute care settings. VA is currently rolling out a 
new initiative, Care of Patients with Complex Problems to assist VAMCs 
nationwide in establishing systems to optimize care for this difficult 
population.
    The State of New York currently has 5 State Veterans Homes; 
however, only one is located within a reasonable geographic proximity 
(Batavia) and, it is the smallest of the 5 state homes. VA stands ready 
to assist the State of New York if they should wish to pursue the idea 
of constructing a new State Veterans Home.

 
----------------------------------------------------------------------------------------------------------------
                                                                                    Distance from Canandaigua
                   Locatin                             Number of Beds                        (miles)
----------------------------------------------------------------------------------------------------------------
                            Jamaica, NY                               250                               335
                            Batavia, NY                               126                                57
                             Oxford, NY                               242                               148
                           Montrose, NY                               252                               292
                       Stoney Brook, NY                               350                               371
----------------------------------------------------------------------------------------------------------------

    Construction plans and designs for the creation of the replacement 
CLC environments at Canandaigua are being reviewed through value 
management efforts conducted by the United States Army Corps of 
Engineers to determine that the construction is the most cost effective 
and efficient possible and would be consistent with industry 
construction standards. The budget request replaces out of date and 
inefficient existing facilities at Canandaigua to house the Veteran 
population currently served as well as developing specialized placement 
options for Veterans with medical and mental health co-morbidities for 
whom there are limited to no community options. New small house 
construction will provide state-of-the-art care environments for 
Veterans. The nearest State Veterans Home to Canandaigua is 57 miles 
away (Batavia) and would not necessarily facilitate the needs of 
Veterans that would be placed a great distance from their home and 
family in the Finger Lakes Market.
    It is important to note that the census indicated in the narrative 
below (first quarter FY 2018) is temporarily restricted to facilitate 
minor renovations to the existing CLC floors. The admission cap will be 
removed following the completion of renovations.

    Question 23: Please explain the aspects of the President's 
Infrastructure Initiative that pertain to VA and what impact the 
Department expects it will have.

    VA Response: The President's Infrastructure Initiative includes new 
and pilot authorities that will provide additional tools for the 
Department to modernize and obtain upgrades to VA's real property 
portfolio to support delivery of quality care and services to Veterans. 
If legislation is enacted, the authorities will provide flexibilities 
for VA to leverage existing assets to continue its efforts to reduce 
the number of vacant buildings in its inventory and will make lease 
threshold modifications to change the lease project amount required to 
obtain congressional authorization for VA medical leases. This change 
would streamline VA's leasing process to quickly and efficiently 
deliver needed facilities to provide care and services to Veterans.

    a. Is this budget request sufficient to fulfill the goals of the 
initiative?

    VA Response: Yes, the budget request is sufficient to fulfill the 
goals on the initiative. The new tools, if legislation is enacted, will 
allow VA to leverage existing facilities and land to obtain new 
facilities and space with little upfront investment cost for VA.

    b. Does VA believe the initiative provides the authorities needed 
to "right size" and align capital assets and infrastructure, without 
additional legislation? If not, which authorities would still be needed 
in legislation?

    VA Response: VA is encouraged by the Infrastructure Initiative and 
believes that legislation authorizing sales and retention of proceeds, 
exchanges for construction value, and increasing the leasing and 
construction thresholds will expand the options VA has available to 
manage its real property portfolio more effectively. In addition to the 
authorities proposed in the President's infrastructure initiative, the 
Department needs the proposed authorities included in the FY 2019 
Budget submission to be enacted in order to increase VA's flexibility 
to meet its capital asset needs, realign facilities, and reduce energy 
costs, including:

      Amend the medical facility definition to allow VA to 
plan, design, construct, or lease joint VA/DoD shared medical 
facilities; and to transfer and receive funds for those purposes.
      Increase to the threshold between major and minor 
construction - from $10 million to $20 million.
      Authority to expand VA enhanced-use lease authority 
beyond supportive housing for other mission needs.

    Question 24: The budget request includes a status list of leases 
that were authorized in previous years. Among other information, the 
list indicates which of these leases have still not been awarded; they 
are summarized below by year of authorization. When is VA's goal to 
award each such lease, and how will this be accomplished?

    2005: 2

    2006: 1

    2010: 2

    2011: 3

    2012: 1

    2014: 21

    VA Response: The following leases were replaced by subsequent lease 
authorizations as noted in the FY 2019 budget submission: Norfolk, VA 
(2005), San Diego, CA (2005), Tyler, TX (2006), Kansas City, KS (2010), 
and San Diego, CA (2011). Due to lack of availability within the market 
the Boston, MA (2011) lease has been decreased to a minor level lease 
of approximately 10,000 sf, with specific services to now be provided 
through existing infrastructure.
    The following leases are moving forward in earnest and currently 
slated for award in FY 2018 or early FY 2019: Bakersfield, CA (2010), 
Columbus, GA (2012), Brick, NJ (2014), Cobb County, GA (2014), 
Charleston, SC (2014), Myrtle Beach, SC (2014), New Port Richey, FL 
(2014), Ponce, PR (2014), Chattanooga, TN (2014), Houston, TX (2014), 
Lubbock, TX (2014), San Antonio, TX (2014), Tulsa, OK (2014), Redding, 
CA (2014), Honolulu, HI (2014), Phoenix, AZ (2014), and San Diego, CA 
(2014). For these leases, VA is currently evaluating offers and 
negotiating price to ensure treatment as an operating lease, fair and 
reasonable pricing, as well as vetting offers to ensure bidders have 
necessary qualifications and relevant experience to deliver projects of 
comparable magnitude.
    For the following leases, VA was unable to obtain proposals that 
met OMB Circular A-11 scoring criteria for an operating lease, or 
experienced other procurement challenges that made these projects 
candidates for a re-start under VA's improved lease process: Lincoln, 
NE (2014), Cape Girardeau, MO (2014), Johnson County, KS (2014), 
Worcester, MA (2014), and Tyler, TX (2014).

    Question 25: How does this year's budget proposal prioritize 
foundational services over other services, and what differences will 
veterans and employees see next year as a result of this 
prioritization?

    VA Response: It is VA's priority to provide world-class mental 
health care to all Veterans. To this end, there are a number of new and 
expanding mental health initiatives that will enhance mental health 
services. EO 13822, Supporting our Veterans During Their Transition 
from Uniformed Service to Civilian Life (January 9, 2018) focuses on 
ensuring that Veterans have seamless access to high-quality mental 
healthcare and suicide prevention resources, with an emphasis on the 1-
year period following separation from active duty. VA is committed to 
hiring a net gain of 1,000 additional providers to continue expanding 
suicide prevention efforts, same day services, and treatment options 
available to Veterans. The Measurement Based Care initiative will make 
immediate use of Veteran self-reported outcome measures to 
individualize and improve mental health care. Overall, the budget 
request will enable the Department to continue established, well-
validated mental health programs, as well as offer opportunities for 
continued expansion of services and access.

    a. Will each clinic, medical center, or VISN develop its own 
foundational services?

    VA Response: Every VA medical center already has Primary Care, 
Geriatrics and Mental Health foundational services established and each 
service has its own local leadership, reporting to a facility's 
executive leadership team.

    b. Is each facility expected to provide all of VA's foundational 
services, or will the services vary from place to place?

    VA Response: Services will vary depending on the complexity of the 
facility. All facilities however, will be required to offer Primary 
Care and Mental Health at a minimum. All facilities are required to 
provide a spectrum of Geriatrics and Extended Care Services as 
articulated in the Medical Benefits package.

    c. Is inpatient care a "foundational service?"

    VA Response: Inpatient care is in the Medical Benefits Package, but 
it is not a "foundational service" available at every VA medical 
facility. VA offers hospice and palliative care in all care settings, 
including in every VA inpatient facility.

    d. Given that a significant amount of VA's assets are directed to 
inpatient care, does the budget proposal contemplate realigning the 
assets toward that goal by, for example, converting low-census 
inpatient facilities into outpatient clinics and surgery centers?

    VA Response: The budget request does not include realignment of 
assets. However, as VA enhances its portfolio of home and community 
based services, we anticipate reducing preventable hospitalizations and 
nursing home stays which may have an impact on future budget 
allocations.

    e. If inpatient services are reduced, how will this affect VA's 
educational mission, given that a significant portion of graduate 
medical education support is for inpatient services?

    VA Response: Medical research and graduate medical education (GME) 
are two of VA's four missions and thus VA will continue to place a high 
priority on fulfilling those roles. While acknowledging that the 
focusing of VA resources towards Foundational Services could have 
effects on medical research and GME activities, those impacts will be 
mitigated by the national methodology that has to be developed for VISN 
and VAMC leaders; one of the primary considerations is the potential 
impact on these programs. In addition, if deemed necessary VA will 
create partnerships to support its research and education missions to 
ensure the well-being of Veterans and the Nation as a whole.

    f. Will the proposed focus on foundational services direct more 
inpatient services into the community? If so, will community care 
funding need to be increased?

    VA Response: Well-resourced and well-staffed foundational services 
optimizing outpatient care and home and community-based services, 
particularly among high risk patients, should prevent avoidable 
hospitalizations/inpatient services and nursing home stays. VA facility 
and VISN leaders are being asked to assess additional, non-VA options 
for other health services that are important to Veterans, yet may be as 
effectively or more conveniently delivered by non-VA providers. Local 
VA leaders have been advised to consider accessibility of VA facilities 
and convenience factors (like weekend hours), as they develop 
recommendations for community access to non-VA providers for Veterans 
in their service areas.

    Question 26: During the budget roll-out briefing held on February 
12, 2018, at VA headquarters, a Committee staff member was told the 
budget proposal does not include costs associated with the recent 
Executive Order to increase access to mental health care and suicide 
prevention services for transitioning Servicemembers in the year 
following their separation from service. However, the news release that 
accompanied the budget stated the budget does support the Executive 
Order. Please clarify the conflicting information.

    VA Response: Shortly before Budget rollout, Congress adopted a 
bipartisan agreement to raise the FY 2018 and FY 2019 budgetary caps 
significantly above the current law. Although not reflected in the 
Budget, the Administration has communicated its preferences for the 
allocation of these additional resources in FY 2018. In this 
communication, the Administration outlined a need for $3.2 billion for 
VA in FY 2018 to support infrastructure improvements, continuation of 
the Veterans Choice Program, and implementation of the EO over a 2-year 
period.

    Question 27: The budget assumes 162,000 additional mental health 
outpatient visits. Are these a result of the expanded mental health 
authorities from the Executive Order?

    VA Response: VA estimates as much as $100 million from VA's 
existing budget will be used to support implementation of EO 13822, by 
realigning funds to support suicide prevention as one VA's core 
priorities. Not all of the mental health services provided to 
transitioning Servicemembers and Veterans as a result of the EO will be 
high-cost services.

    Question 28: How many of the additional 162,000 projected mental 
health outpatient visits are the result of the recent initiative to 
expand mental health care to veterans with Other than Honorable 
discharges?

    VA Response: Assuming the 2017 trends with Other Than Honorable 
(OTH) emergency mental health services continue, this will be a small 
portion of the total projected workload.

    a. Has the utilization of care by veterans with OTH discharges been 
as expected?

    VA Response: The number of OTH former Servicemembers seeking 
emergency services has been below expectation. Overall, since July 5, 
2017, 4,973 OTH former Servicemembers have requested VHA healthcare 
through the present, with only a limited number specifically seeking 
mental health emergency services.

    b. Has VA noticed any regional trends in health care utilization by 
these veterans?

    VA Response: There have been relatively few OTH former 
Servicemembers seeking VA health care services to date. VA is 
developing evaluation databases that will allow us to examine regional, 
demographic and clinical trends in this population in the coming 
months.

    c. What types of mental health services are these veterans seeking?

    VA Response: Emergency inpatient hospitalization, outpatient 
services and medication refills.

    d. How many of these veterans are eventually deemed eligible to 
enroll-and, in fact, do enroll-in the VA healthcare system?

    VA Response: VA, DoD and the Department of Homeland Security 
submitted a Joint Action Plan to the White House on March 9, 2018, 
related to implementation of EO 13822. Additionally information will be 
provided once the plan is publically released.

    e. How successful has VA been in transitioning those veterans who 
are not eligible to enroll in the VA healthcare system to other care 
settings?

    VA Response: There has been no indication or report of facility 
inability to transition care as appropriate. All licensed providers 
have an ethical responsibility to ensure follow-up is established prior 
to provider-patient termination.

    f. How, if at all, has mental health care to honorably discharged 
veterans been impacted by the Other than Honorable discharge 
initiative?

    VA Response: Direct impact on access and mental health services has 
been negligible. The largest impact is typically during the initial 
period of the request for care. Crisis management commonly takes 
dedicated provider effort over what can be considerable time. Cross 
coverage during these periods is critical, and sites with staffing 
limitations would experience the greatest impact.

    Question 29: How would this budget proposal fund suicide prevention 
initiatives with community partners, given that 70 percent of veterans 
who die by suicide are unknown to VA?

    VA Response: Ending Veteran suicide will take a national effort 
that is community based. Partners, at all levels, are key to those 
efforts and a major focus of our innovative approach to suicide 
prevention. Initiatives underway or currently planned include expansion 
of partnerships specifically targeting services to Veterans not 
enrolled in VA care, the Mayor's Challenge program building community 
capacity to end Veteran suicide, and the evolution of our suicide 
prevention coordinator model from a healthcare and crisis concentrated 
model to one that also includes public health, community centered 
approaches.

    Question 30: To what factors does VA attribute the 86 percent 
increase in the number of veterans receiving mental health services 
from 2005 to 2017?

    VA Response: There are likely a number of social and organizational 
factors that have contributed to the significant increase in the number 
of Veterans receiving mental health services. Organizationally, over 
this 12-year period, VHA has made significant investments in hiring and 
program development. VHA has consistently demonstrated that if 
facilities invest in hiring and program implementation, Veterans will 
utilize the services. The challenge that VHA has been experiencing is 
that the utilization then outpaced the ability to continue hiring and 
expanding program availability. Socially, mental health services are 
more available and culturally accepted. Importantly, the extensive 
mental health services were not available for returning Vietnam-era 
Veterans, and in combination with the current war on terrorism, an 
increasing number of Veterans continue to utilize VHA mental health 
services.

    a. Is a similar increase expected over the next decade? If so, how 
much more mental health capacity will be needed within VA to 
accommodate that increase?

    VA Response: There is a huge gap in treatment for mental health 
conditions across the U.S. as a whole. This gap is due to: a lack of 
access to treatment, barriers to receiving care, social stigma that 
still, in some parts of the country, attaches to the receipt of mental 
health services, or a lack of perceived need for services. For example, 
the 2015 National Survey on Drug Use and Health (NSDUH) estimated that 
21.7 million Americans had clinical need for substance use disorder 
treatment, but only 2.3 million of these received specialty treatment; 
however, 95 percent of those with identified clinical need for 
treatment who didn't receive treatment did not perceive a need for care 
(e.g. see report at: https://www.samhsa.gov/data/sites/default/files/
report--2716/ShortReport-2716.html). These population statistics on one 
mental health condition frame the general problem. Large populations of 
Americans, including Veterans, have mental health conditions that are 
not being treated. Lack of treatment almost certainly has negative 
personal and societal costs and consequences, but these populations are 
not necessarily actively seeking services. Prior analyses have 
suggested that Veterans have slightly lower unmet need compared to the 
general population (see Golub A, Vazan P, Bennett AS, Liberty HJ). 
There is an unmet need for treatment of substance use disorders and 
serious psychological distress among Veterans (see the Nationwide 
analysis using the NSDUH: Mil Med. 2013 Jan; 178(1):107-14.).
    VHA added treatment capacity from 2005 to 2017, which allowed some 
of this population to access needed mental health services. The 
increase in number of patients treated was driven by budget/mental 
health service capacity in VHA, not by shift in population need for 
services. While adding capacity, VHA made changes to its health care 
delivery design to improve mental health screening and bring mental 
health services to patients being seen in primary care, helping to 
address the tendency of persons with mental health conditions to not 
actively seek care. However, there is still a substantial unmet need. 
VHA is implementing additional innovations in mental health care 
delivery, including clinical video telehealth and telephone care 
management services, which may help to make mental health services more 
accessible and acceptable to Veterans with clinical need. We expect 
that increased treatment capacity and availability of standard and 
innovative mental health care, would continue to increase the 
proportion of Veterans with mental health conditions who receive 
treatment. If additional capacity for services is provided, we expect 
to continue to see an increase in mental health service utilization for 
some time, as we are not near a steady state in terms of meeting the 
full need for mental health services.

    Question 31: The budget proposal includes five additional Vet 
Centers by 2020.

    a.What data was used to determine that five are needed?

    VA Response: The Readjustment Counseling Service (RCS) used 
workload and productivity data, including growth rate in relationship 
to capacity to determine resource of the new Vet Centers. Since FY 
2016, RCS has seen a 27 percent growth in the number of unique 
Veterans, active duty Servicemembers, and families served by Vet 
Centers. During the same period RCS has experienced a 17 percent growth 
in the volume of readjustment counseling services (individual, group, 
marriage, family counseling, outreach, etc.) provided. RCS is expected 
to experience similar growth rates in the next several FYs.
    RCS current assets consist of the 300 "brick and mortar" Vet 
Centers, 80 Mobile Vet Centers, and the Vet Center Call Center. Until 
recently, new Vet Centers were approved and placed into communities 
based on county Veteran population and proximity to other Vet Centers. 
This expansion process was changed in 2016 to a demand model taking 
into account actual Veteran and active duty Servicemember (ADSM) usage 
and ensuring that services to communities are in line with the needs of 
those particular communities. This includes having RCS staff regularly 
provide services beyond the existing 300 Vet Centers through the use of 
Vet Center Community Access Points (CAPS) and Vet Center Outstations.

      Vet Center CAPS are locations typically in non-cost space 
located in sites developed in collaboration with community partners 
where direct counseling services are provided at levels that are 
consistent with the needs of these communities (monthly to several 
times a week). As the demand for services change or moves to other 
communities, RCS staff are able to move with that demand with minimal 
effort and cost.
      Vet Center Outstations are leased spaces located in 
communities where the demand for services requires at least one full 
time counselor (40 hours per week) to be permanently assigned. 
Supervision and administrative responsibilities are provided through 
the closest Vet Center. Vet Center Outstations are developed by RCS and 
approved by the Under Secretary for Health pursuant to a delegation of 
authority signed by the Secretary on June 1, 2016.

    Typically, RCS staff begin the expansion process by working to 
understand the demand and needs of a particular community through 
targeted outreach and the piloting of service provision through a Vet 
Center CAP. As services progress, Vet Center leadership assess and 
increase or decrease services based on that actual demand.
    If service provision increases to a point that requires a 
counselor(s) to be in that community permanently, RCS Leadership works 
to receive approval for a Vet Center Outstation. This approval also 
allows RCS to explore leasing opportunities for a permanent location in 
that community
    As demand for services at Vet Center Outstations increase and 
require more resources such as additional staff and space, RCS 
Leadership will work to receive approval to create a full "brick and 
mortar" Vet Center.

    b.When are each of the five scheduled to open?

    VA Response: The five new Vet Centers are scheduled to open 
beginning in FY 2019 through the end of FY 2020. At the current rate of 
growth (both services provided and associated with unique Veterans, 
ADSM, and their families) and current Full Time Equivalents (FTE) 
employee levels, continued growth in services will be significantly 
limited in approximately 2 years. RCS is working to create additional 
efficiencies to deal with potential capacity issues through decreasing 
time to hire through a centralized human resource service, authorized 
FTEs increases, and increasing the number of CAPS to reach underserved 
areas. This also includes reviewing the current footprint of Vet Center 
Outstations to assess and determine if any of these locations need to 
be converted to a full "brick and mortar" Vet Center.

    c.Where will they be located?

    VA Response: The locations will be determined utilizing the demand 
model outlined above.

    d.What impact will the five additional Vet Centers have on mental 
health access?

    VA Response: Additional Vet Center locations will positively affect 
the VA's overall ability to increase access to care for eligible 
Veterans, active duty Servicemembers, and their families while decrease 
barriers associate with accessing that care (ex: driving distance). The 
RCS strategic goals for 2018-2020 include improving access to 
Readjustment counseling in communities distant from existing Vet Center 
services by increasing the number of Vet Centers (projected increase of 
five), Outstations (projected increase of five), and Community Access 
Points in Rural and Highly Rural Areas. In addition, RCS is increasing 
non-traditional hours of service provision, coordinated emergency 
response capability, and expanding community partnerships. All RCS 
service provision is legislated through 38 U.S.C. Section 1712A. RCS, 
by design, is a non-medical service provided without the need of a 
diagnosis or enrollment in VHA healthcare. RCS staff work 
collaboratively with local VHA staff to engage Veterans, Servicemembers 
and their families and to facilitate obtaining appropriate medical 
care, including more intensive mental health services. RCS has 
historically proven to be a very effective entry point into the larger 
VA, especially with Veterans, Servicemembers and families that might be 
reticent to enter into mental health treatment given stigma and all 
other barriers to care.

    Question 32: If enacted, how will this budget proposal improve the 
timeliness of medical health care services that veterans experience, 
and how will timeliness be measured?

    VA Response: This proposed funding would support staffing 
requirements needed to optimize access where patient demand exceeds 
staff supply with a particular focus on primary care, mental health, 
and medical and surgical specialties. Such staffing would include 
nursing and administrative clinic staff in addition to providers. The 
funding would also support optimizing recruitment and retention 
incentives for specialties and parts of the country where staffing has 
been challenging to optimize. Furthermore, this proposed funding would 
support the expected rapid increase in virtual care services such as 
telehealth. Timeliness would be measured by average wait times to see 
new and established patients that will be publicly displayed on the 
www.accesstocare.gov website.

    Question 33: How will initiatives funded in this budget proposal 
reduce the Electronic Wait List?

    a.How many unique veteran patients are on the Electronic Wait List 
as of the date of VA's response to these questions?

    VA Response: Presently, there are over 15,960 Electronic Wait List 
Veteran entries comprising 15,408 unique Veterans (i.e., some Veterans 
may be listed on the Electronic Wait List for more than one appointment 
type).

    b.How many are forecasted to be on the list a year from that date?

    VA Response: With the added funding proposed to expand Veteran 
access to medical care, it is projected that in 2019, the number of 
Electronic Wait List entries will decline by approximately 33 percent 
to 10,653.
    As mentioned in the response to question 32, the proposed funding 
would support staffing needs to optimize access where patient demand 
exceeds staff supply with a particular focus on primary care, mental 
health, and medical and surgical specialties. This staffing would 
include nursing and administrative clinic staff in addition to 
providers. Such funding would also support optimizing recruitment and 
retention incentives for specialties and parts of the country where 
staffing has been challenging to optimize. Furthermore, this proposed 
funding would support the expected rapid increase in virtual care 
services such as telehealth. All of these efforts would be expected to 
reduce the Electronic Wait List.

    Question 34: What is the current utilization rate for same-day 
services for primary care and for mental health care?

    a.How many veterans seeking same-day access to primary and mental 
health care currently receive an in-person or telehealth appointment 
that same day?

    VA Response: In Mental Health, 11.1 percent of all face to face and 
telehealth appointments combined were completed the same day in FY 
2017; 11.3 percent of all face to face and telehealth appointments 
combined were completed the same day during the first quarter of FY 
2018.
    In Primary Care, 20.5 percent of all face to face and telehealth 
appointments combined were completed the same day in FY 2017; 23.7 
percent of all face to face and telehealth appointments combined were 
completed the same day during the first quarter of FY 2018.
    In Mental Health during FY 2017, 773,235 appointments were 
completed the same day via face to face appointment where 23,007 
appointments were completed the same day via telehealth during FY 2017.
    In Primary Care during FY 2017, 2,453,882 appointments were 
completed the same day via face to face appointment where 3,860 
appointments were completed the same day via telehealth during FY 2017.
    VA also may provide same day services via telephone encounters and 
secure email messages. VA is unable to currently measure how many 
Veterans receive same day services via these care modalities.

    Question 35: The budget indicates VA expects to treat 80 percent of 
enrolled veterans who need Hepatitis C care with new Hepatitis C 
treatments by 2020. What barriers to care exist for the remaining 20 
percent of enrolled veterans with Hepatitis C?

    VA Response: Consistent with Centers for Disease Control and 
Prevention and United States Preventive Services Task Force 
recommendations, VA recommends screening of all patients born between 
1945-1965 for Hepatitis C virus (HCV) as well as those who have on-
going risk factors for HCV infection. As of March 30, 2018, 82.5 
percent of all high-risk patients have been tested for HCV. VA 
continues to do outreach to offer testing to patients at risk for HCV
    As of April 30, 2018, over 107,719 Veterans under VA care for their 
HCV have been started on new, highly effective antiviral treatments, 
with cure rates of 95 percent. It is estimated that there are 
approximately 31,644 Veterans under our care for HCV who remain to be 
treated with these new treatments. We estimate that approximately 9,000 
of these remaining patients will receive treatment in FY 2018. VA has 
made documented efforts to contact most, if not all, of the 31,644 
Veterans with HCV who remain to be treated. Many have not responded or 
have otherwise refused treatment, are homeless, or have medical, mental 
health, or substance use comorbidities which are treatment limiting. 
For those in this untreated subset who wish to receive HCV treatment, 
it will be provided in FY 2019, assuming they do not decline treatment, 
fail to follow-up with their treatment plan, or have clinical contra-
indications (such as unstable/uncontrolled/incurable co-morbidities) 
preventing such treatment.
    Current program outreach efforts include the use of: Field-based 
VISN Hepatitis Innovation Teams deploying system redesign/LEAN at the 
majority of facilities to address gaps in HCV testing and treatment; 
informatics tools for patient tracking and monitoring clinical outcomes 
(HCV Clinical Case Registries/HCV clinical dashboards); national and 
local social media and advertising campaigns; patient and provider 
resources; and local outreach and prevention programs targeted for 
high-risk populations.

    Question 36: How much money does VA anticipate spending in fiscal 
year 2019 on gender-specific services for male veterans?

    VA Response: Gender-specific services for male Veterans include a 
variety of clinical services including Urology, Pharmacy, Prosthetics, 
and other services. VA does not have any specific data point to 
anticipate spending for gender-specific services for male Veterans.

    Question 37: Written testimony indicated VA has ".critically 
assessed and prioritized our needs and aggressively pursued internal 
offsets, modernization reforms, and other efficiencies." Please provide 
a copy of that assessment.

    VA Response: As part of the Department's budget formulation 
process, the Administrations and staff offices assessed and prioritized 
needs and internal offsets and modernization reforms to focus resources 
for high priority functions or initiatives. Some examples of internal 
offsets and modernization reforms that are built into the FY 2019 
Budget include VBA's repurposing of personnel from indirect support 
activities to Veteran-facing functions, reductions in VBA contracts, 
modernization of the EHR and Financial Management System, 
prioritization of foundational services while redirecting to the 
private sector those service that they can do more effectively and 
efficiently, and $30 billion in VBA administrative savings over 10 
years.

    Question 38: How does this budget represent a new prioritization of 
needs compared to prior budgets?

    VA Response: This budget targets key areas in which we want to make 
significant improvements. Examples include full discretionary funding 
for Veterans Community Care starting in FY 2019; a significant 
investment for Capital Investment; new funding for the EHRM effort; and 
targeted resources for disability claim appeals, women's health and 
mental health to include suicide prevention which are all high 
priorities for the Administration.

    Question 39: Please explain how the portion of the budget 
pertaining to the Financial Management Business Transformation relates 
to the Administration's proposal for a VA Center for Innovation for 
Care and Payment.

    VA Response: The proposed VA Center for Innovation for Care and 
Payment would carry out pilot programs to develop innovative approaches 
for testing payment and service delivery models to reduce expenditures 
while preserving or enhancing the quality of care furnished by the 
Department. FMBT would support this effort by providing a comprehensive 
financial management system that enables VA to accurately measure 
progress from a financial aspect while complying with financial 
management legislation and directives.

    Question 40: Would the Working Capital Fund legislative proposal 
allow VA to become a shared service provider for financial management 
systems modernization?

    VA Response: While VA is already an internal shared service 
provider for financial management system modernization through its FMBT 
program, the Working Capital Fund (WCF) legislation will certainly 
strengthen and enhance the FMBT program. WCF legislation was proposed 
so that VA can finance critical financial management activities such as 
FMBT and the Stop Fraud, Waste, and Abuse initiative to improve payment 
integrity. Long term, the WCF legislation will support VA's 
centralization of financial services and eliminate costly redundancies.

    Question 41: Why are medical care collections expected to decrease 
in fiscal year 2018 and 2019, compared to 2017?

    VA Response: FY 2018 and FY 2019 medical care collections 
incorporate the full impact of the Tiered Medication Copayment 
Structure of $5 for preferred generics/ $11 for brand single source/ $8 
for all other medications, and a $700 copayment cap for all priority 
groups. The tiered copayments and copayment cap, combined with the 
impact of Pharmacy utilization trends, resulting in lower First Party 
collections in FY 2018 and FY 2019.
    Third Party payers are terminating and/or reducing reimbursement to 
VA for non-service-connected care. Payers are reacting to current 
market conditions in commercial health care by attempting to reduce 
provider reimbursement rates across the board. To account for these 
payer trends, it's anticipated that collection estimates will continue 
to decline in FY 2018 and stabilize in FY 2019. MCCF estimates include 
an adjustment for the projected budget impact of changes to payer 
agreements. The estimated impact of the changes in reimbursement rates 
are reductions in potential Third Party collections of $119M in FY 2018 
and $124M in FY 2019.

    Question 42: Is it correct that VA's average Medical Care 
Collections Fund collection rate is based on billings, not another 
basis as commonly stated, is roughly 36.5 percent?

    VA Response: VA has historically reported collections performance/
efficiency using the Collections to Billing (CtB) ratio, which compares 
claim level collections to gross billed amounts. The CtB ratio did not 
account for the limitations based on payer maximum allowable charges or 
patient cost sharing responsibilities which are uncollectible by the 
VA. In other words, the billed charge reflected amounts that VA would 
never have collected from a veteran's private health insurance plan 
(for example, because VA had conducted a rate verification with the 
insurance company and verified a reimbursement rate that is lower than 
billed charges but consistent with what the payer is reimbursing other 
providers).
    To more accurately reflect VA's collections performance/efficiency, 
VA will report collections performance using Net Collections Ratio, 
which is a VA-developed measurement that is comparable to industry 
standard reporting on collection performance and provides a more 
accurate representation of VA's effectiveness in optimizing collections 
from 3rd party payers. Net Collection Ratio measures collections as a 
percentage of Total Collectible Amount instead of billed charges. The 
Total Collectible Amount is billed charges minus uncollectible amounts 
like payer discounts that VA has negotiated and other health insurance 
(OHI) patient responsibility (e.g., co-payments and co-insurance, which 
VA does not collect). The national Net Collections Ratio as of February 
2018, is 95.9 percent, which is in-line with industry trends of 95% to 
100% of net collectible revenue.

    a.How would initiatives in the budget proposal improve VA's ability 
to collect, and what is the expected collections rate, in percentage 
terms as well as dollars, after they are implemented?

    VA Response: VA included five legislative proposals in the FY 2019 
President's Budget that are intended to improve the efficiency and 
effectiveness of revenue operations. For all of the legislative 
proposals, the net collections ratio would remain stable.

    1.Acceptance of VA as a Participating Provider by Third Party 
Payers would allow VA to be treated as a participating provider for 
reimbursement purposes whether or not an agreement is in place with a 
third party payer of health plan. If enacted, this legislative proposal 
will provide VA with the ability to collect at the participating 
provider reimbursement level. Currently, when VA provides services for 
a Veteran who has coverage under a third party payer who does not have 
an agreement with VA the out of network reimbursement is reduced or may 
be non-existent if the third party payer does not offer out of network 
benefits. The anticipated increase in collections is $105.9M annually.

    2.Aligning with Industry Standards by Eliminating Offsets of First 
Party Copayments would allow VA to discontinue the practice of 
crediting the first party copayment due from Veterans for non-service-
connected care using the funds collected from third party health plan 
carriers. The legislative proposal would align VA with private sector 
practices. The anticipated increase in collections is $53.9M annually.

    3.Mandatory Insurance Capture Enforcement would create a mechanism 
to enforce the disclosure of third party health plan contract 
information as required by Public Law (P.L.) 114-315, section 604. This 
legislative proposal creates a mechanism for Veterans who fail to 
provide third party health plan coverage information necessary to VA 
for the purpose of billing and collecting from third party payers. The 
anticipated increase in collections is $8.5M annually.

    4.Improving Timeliness of Billing by Authorizing the Release of 
Protected Patient Information for Health Care Services would allow VA 
to disclose records of the identity, diagnosis, prognosis or treatment 
of a patient relating to drug use, alcoholism or alcohol abuse, 
infection with human immunodeficiency virus or sickle cell anemia to 
health plans for the purpose of reimbursement. Currently, VA is 
required to obtained a signed release of information from the patient 
before billing a claim for these services to a third party payer. This 
legislative proposal would bring VA in line with private sector 
practices and allow VA to submit claims for reimbursement without 
obtaining a written authorization from the Veteran. The anticipated 
increase in collections is $42.4M annually.

    5.Third Party Payer Enforcement Provision (Recover Lost Collections 
from Third Party Payer) provides a provision that will allow VA to 
institute administrative enforcement actions against third party payers 
who fail to comply with provisions of 38 USC 1729 and supporting 
regulations 38 CFR 17.101 and 38 CFR 17.106. Any funds collected 
through the administrative enforcement actions would be additional 
revenue returned to MCCF to provide additional services to Veterans 
across the Nation. The proposed legislation would allow VA to assess 
fines against third party payers for non-compliance with statutory and 
regulatory collection provisions. There is no anticipated increase in 
MCCF collections in FY 2019 until regulatory authority is in place.

    Question 43: What is VA's official position on using third party 
collections entities to assist the Department in collecting revenues?

    VA Response: Generally, VA can use third party collection 
contractors provided that it is not subject to transfer to Treasury, 
when it is in the government's financial interest, and it is consistent 
with the purposes of the Debt Collection Improvement Act of 1996 (DCIA) 
(31 CFR 285.12). In addition, VA has a separate authority under 38 
U.S.C. Sec.  1703 to award a contract to a third party collection 
entity to audit VA community care claims and payments and to initiate 
recovery of any overpayments.

    Question 44: How many of the research projects that would be funded 
in this budget proposal involve canine test subjects?

    VA Response: Based upon historical trends, 1-3 new research 
projects funded annually by VA would typically involve the use of 
research dogs. Continuing support of 7 existing VA-funded dog projects 
is anticipated as well.

    Question 45: How does VA evaluate proposed research projects to 
ensure they are veteran-centered and veteran-focused?

    VA Response: The VA Office of Research and Development (ORD) 
conducts scientific peer review to the highest standards similar to 
other science funding agencies and funding decisions are awarded based 
on their ability to meet our Service Mission and priorities for 
Veterans health care needs. In order to be reviewed, an application 
must align with one of the ORD Research Services scientific purview and 
advance scientific knowledge across the research continuum including 
biomedical, clinical, health services, and rehabilitative research. The 
review criterion is explicit in that research must address an important 
scientific question and supports and advances the health and health 
care of Veterans. Specifically, a proposed research project must meet 
the following criteria to clearly demonstrate it has significant 
impact:

      Significance - addresses important problem or critical 
knowledge gap in the field; supports or advances the health and health 
care of Veterans.
      Innovation - challenges existing paradigms, explores new 
concepts, methodologies, or technologies.
      Approach - incorporates current scientific and 
theoretical bases; hypothesis-driven; use of appropriate research 
design and methods for addressing hypothesis; feasibility of methods 
are clear.
      Investigators - utilizes investigators with appropriate 
expertise, experience, and record of accomplishments to enable 
successful completion of the proposed research.
      Resources - proposed research environment will enable 
successful project (e.g., facilities, equipment, and staff).After 
scientific merit review, final funding decisions are made by ORD's 
Service Directors based on impact or priority scores, peer reviewer 
evaluations, ORD priority areas, and available budget.

    a.Are there some areas of VA research that could be scaled back or 
discontinued to make funds available for more veteran-centric research 
projects?

    VA Response: No. ORD only supports projects that are veteran-
centric funded.

    Question 46: The budget proposal notes that VA research has a track 
record of transforming VA health care by bringing new evidence based 
treatments and technologies into everyday clinical care. Please provide 
10 examples of VA research conducted in the last five years that 
directly produced treatments that VA providers are presently using to 
treat veterans.

    VA Response: The following are key examples of evidence-based 
treatments that are currently being implemented in everyday VA clinical 
care that were based on VA-sponsored research published within the past 
5 years. Links to the original research articles are also provided.

    1. Providers in VISNs 7, 16, 20, and 23 are deploying Telemedicine 
Outreach for Posttraumatic Stress Disorder (PTSD), which is a program 
based on research conducted in the VA that demonstrated the 
effectiveness of virtual team-based care for rural Veterans with PTSD: 
https://www.ncbi.nlm.nih.gov/pubmed/25409287.

    2. Providers at the West Haven, Denver, and Palo Alto VAMCs are 
implementing stepped care for pain treatment, based on a model 
previously shown to be effective in pain management for Veterans: 
https://www.ncbi.nlm.nih.gov/pubmed/25751701.

    3. Providers in VISN 1, VISN 5 and VISN 19 were trained in the HUD-
Veterans Affairs Supportive Housing and Homeless Patient Aligned Care 
Team staff on Maintaining Independence and Sobriety through Systems 
Integration, Outreach, and Networking (MISSION) Model. MISSION is an 
evidence-based Veteran-centric intervention developed within the VA and 
delivered by case managers and peer specialist to address mental 
health, substance use, and homelessness: https://www.ncbi.nlm.nih.gov/
pubmed/26018048.

    4. Providers at VA Boston and West Haven are implementing the VA 
National Bipolar Disorders Telehealth Program: (https://
www.ncbi.nlm.nih.gov/pubmed/28665773) which is based on a collaborative 
care model developed by VA researchers that was shown to improve health 
outcomes among individual with bipolar and other mental disorders: 
https://www.ncbi.nlm.nih.gov/pubmed/27780336.

    5.VA has hired onto clinical teams over 1,100 mental health Peer 
Specialists (Veterans with mental illness who are trained to use their 
experience to help other Veterans with mental illness). This Peer 
Specialist model has been found to increase patient activation (https:/
/www.ncbi.nlm.nih.gov/pubmed/23657754) and are valued by Veteran 
patients and VA providers (https://www.ncbi.nlm.nih.gov/pubmed/
24091610).

    6.Providers at the VA Greater Los Angeles Healthcare System are 
also implementing an integrated care program previously established in 
VA research to improve mental health quality and outcomes among women 
Veterans with anxiety and depression treatment needs. This is an 
example of a larger program (Primary Care-Mental Health Integration) 
that was nationally implemented in VA and based on VA research on 
effectiveness of collaborative care for depression, PTSD, and substance 
use risk management in primary care: https://www.ncbi.nlm.nih.gov/
pubmed/20695668.

    7.The Hospital-to-Home campaign initiative was implemented by 
providers and based on prior VA research (https://  
www.ncbi.nlm.nih.gov/  pubmed/?term=hospital+to+home  +heidenreich  
+veterans+randomized) and resulted in a decline in 30-day readmission 
rates and reduction of 21,000 hospital days each year, which translates 
to cost savings of approximately $18 million per year.

    8.In partnership with leaders from the VA National Center for 
Health Promotion and Disease Prevention, VA providers across the US are 
implementing the updated VA MOVE! weight management program guidance 
based on work by investigators at the Durham and Ann Arbor VAMCs: 
https://www.ncbi.nlm.nih.gov/pubmed/28747191 and https://
www.ncbi.nlm.nih.gov/pubmed/25217098.

    9.Providing the most advanced upper extremity prosthetic arm to 
Veterans with limb loss. ORD was the clinical partner in Defense 
Advanced Research Projects Administration's (DARPA) Revolutionizing 
Prosthetics program. The industry partner under contract to DARPA was 
Dean Kamen (DEKA) Research and Development Corporation. ORD conducted 
optimization and take home-home trials of the DEKA arm (now known as 
LUKE arm). This led to research data for the Food and Drug 
Administration (FDA) submission and eventual approval by FDA in 2014, 
and ultimately led to commercialization of the LUKE arm by MOBIUS 
bionics for Veterans and the Nation. Two Veterans each received a LUKE 
arm in June 2017. An historical note of significance is that upper 
extremity prosthetics had not seen major improvements in over 50 years.

    10.Increase in Employment for Veterans with Spinal Cord Injury 
(SCI). Return to work rates are very low following an SCI for the 
general population and even more so for the Veteran population. ORD 
investigators conducted research to develop and test a program intended 
to get Veterans back into working status. The Spinal Cord Injury 
Vocational Integration Program (SCI-VIP) was developed with some core 
principles in mind such as vocational training early on in the overall 
rehabilitation process, deploy a highly integrated team approach, 
including vocational services, transportation services, training and 
adaptations to conduct work. Following research to develop and test 
SCI-VIP, a Predictive Model Over Time for Employment (PrOMOTE) study 
was conducted. It was found that the SCI-VIP/PrOMOTE program was 
effective in helping Veterans with SCI get jobs and stay employed (43 
percent). After the research ended, six of the seven study sites 
continued to offer the program in their clinics, enabling Veterans with 
SCI to receive training and obtain gainful employment. The investigator 
is reaching out to others in VHA to describe the program and its 
successes.

    Question 47: The budget proposal includes a 2018-2020 goal of 
"achiev[ing] efficiencies and alignment through deployment of strategic 
field-based councils, including integration with other foundational 
services, in support of VHA modernization and the agency's priorities." 
What are the "strategic field-based councils?"

    a.Which professionals make up these councils, and what functions 
are the councils expected to perform?

    b.How will these councils achieve increased efficiency and 
alignment, and how will that increase be measured?

    VA Response: The creation of the strategic field based councils is 
in the concept planning phase. Strategic field based councils could 
meet several objectives which are currently in design but include 
improving change management and selection of and prioritization of new 
initiatives.

    Question 48: Another 2018-2020 goal is "expand[ing] access by 
opening telehealth capacity for underproductive providers to assist 
access-challenged providers." How does VA define and identify an 
"underproductive provider" and an "access-challenged provider"?

    a.How will "underproductive providers" be leveraged to assist 
"access-challenged providers," and how will such assistance be 
measured?

    b.How will this assistance increase access to care for veteran 
patients, and how will increased access be measured?

    VA Response: VA's goal to expand access using this methodology 
defines an "underproductive provider" in primary care as a provider 
whose patient panel size, i.e., the number of patients enrolled for 
care with a given provider, is less than 80 percent of their goal for 
patient panel size. In mental health, an "underproductive provider" is 
defined as a provider whose individualized productivity is less than 80 
percent of their productivity target. An "access-challenged provider" 
would just be the opposite, i.e. a provider who exceeds their patient 
panel size goal in primary care or exceeds their productivity goal in 
mental health; this type of provider can be challenged to meet the 
needs of all the patients they are assigned to serve. VA will be using 
"underproductive providers" to support patient needs via telehealth (or 
sometimes via traditional face to face appointments) to support 
"access-challenged providers" and areas where there is a shortage of 
providers. This endeavor will increase access by adding clinic 
appointments at locations that would benefit from support of additional 
providers. For example: VA may be experiencing longer than average wait 
times at one location, but an "underproductive provider" at another 
location could see the patients waiting for care via telehealth and 
help reduce wait times. This assistance will be measured by assessing 
for increased panel sizes for the underproductive primary care 
providers and increased productivity for the underproductive mental 
health providers. Additionally, the sites that are being supported by 
this program should experience a decrease in wait times.

    Question 49: Another 2018-2020 goal is "opening a third Veterans 
Crisis Line location to meet increased demands for crisis intervention 
services." Where and when will the third location be opened?

    VA Response: The third Veterans Crisis Line Call Center is located 
in Topeka, KS on the campus of the Eastern Kansas Health Care System. 
While it opened in early January 2018, a public grand opening/ribbon 
cutting ceremony occurred on May 25, 2018.

    a.Will the third crisis line location be a stand-alone facility or 
co-located with another facility or service?

    VA Response: The third location is co-located on the campus of the 
Eastern Kansas Health Care System in Topeka, KS in Building 3.

    b.What is the third Veterans Crisis Line location's estimated cost?

    VA Response: The estimated first-year start-up cost, including the 
costs for building renovation, staffing, training, and travel, is 
roughly $28.5 million.

    c.How many more FTEs will be needed to properly staff the third 
crisis line location?

    VA Response: With 57 responders, supervisors, and support staff 
already on board, there are 82 FTE positions that remain open. However, 
because of space constraints and pending construction, recruitment will 
pause at 90 FTE, with a target date of July 31, 2018. Recruitment for 
these positions is ongoing.

    Question 50: How is demand for crisis intervention services 
measured?

    VA Response: The Veterans Crisis Line (VCL) program assesses and 
measures its effectiveness in accordance with quality of care criteria 
and standards applicable to other, similar, non-VA crisis call centers 
by the American Association of Suicidology and the Commission on 
Accreditation of Rehabilitation Facilities. The program also 
incorporates measures recommended by VA's Office of Inspector General 
in its report Office of Inspector General Report No. 14-03540-123, 
Healthcare Inspection: Veterans Crisis Line Caller Response and Quality 
Assurance Concerns, Canandaigua, New York, February 11, 2016 and Office 
of Inspector General Report No. 16-03985-181, Healthcare Inspection: 
Evaluation of the Veterans Health Administration Veterans Crisis Line, 
March 20, 2017.
    More specifically, outcome measures used in the VCL program include 
key performance variables such as average speed to answer, customer 
satisfaction, call monitoring, and infrastructure reliability. Across 
these measures, the following data is relevant:

      VCL answers calls in less than 10 seconds.
      Over 99 percent of calls monitored for quality assurance 
meet established criteria for ensuring safety.
      VCL currently has an average rollover rate <1.0 percent 
and an average abandonment rate <5.0 percent.
      Customer Satisfaction is over 95 percent for Veteran and 
third party callers.
      Substantiated complaints about VCL service are received 
for less than .001 percent of all calls answered.
      All VCL service modalities (phone, online chat, text) are 
tested 3 times per day, around the clock.

    a.How much increased demand for these services is anticipated 
within the next two years?

    VA Response: Demand for VCL services may change based on factors 
such as business operation improvements, advertising, and national 
suicide prevention events and efforts. Based on call patterns of the 
last year, demand for VCL services is anticipated to increase at an 
annual approximated rate of 12 percent.

    b.How, if at all, does an increased demand for crisis intervention 
services correlate with expected suicide rates, and how would a demand 
increase impact veteran suicide rates?

    VA Response: There are no industry-established criteria to assess 
the rate of suicide attempts and completions in direct correlation with 
crisis call center services or crisis call center effectiveness. Those 
outcomes are affected by many other variables. VA is committed to do 
all it can.

      The rate of suicide attempts and completions is 
critically important. It is best seen as an index of population health 
management across a health care system including the broad continuum of 
care including crisis intervention services, mental health care, and 
other healthcare services (primary care, pain management, etc).
      Combatting Veteran suicide requires continued attention 
to increased population coverage (access to care), improved continuity 
of care, and enhanced experience of care (satisfaction) across the 
entire VHA enterprise. This is why VHA measures and reports on 
population coverage, continuity of care, and experience of care as 
domains within the mental health Strategic Analytics for Improvement 
and Learning (SAIL) domain as applied to each facility.

    Question 51: The budget proposal includes an Annual Performance 
Plan for VHA. One of the targets for "Progress in Cerner project 
implementation (percent milestones met)" is shown as "to be 
determined." What will this target be?

    a.Other performance targets on the Annual Performance Plan appear 
low and seem to reflect modest expectations. The overall rating for 
hospitals is 66.5 percent, for primary care providers is 70 percent, 
and for specialty care providers 67.5 percent. How are these indicators 
measured and how were they developed?

    VA Response: These indicators are derived from the Overall Provider 
Rating items in the Consumer Assessment of Health Providers and Systems 
(CAHPS) surveys that are administered to Veterans who use our hospital, 
primary care, and specialty care services. CAHPS is the industry 
standard questionnaire for assessing hospitals, health plans (e.g., 
Medicare Advantage Plans), and clinician group practices. The item is 
scored as the percentage of patients giving their provider a score of 9 
or 10 on a scale of 1 to 10, where 10 represents "best care 
imaginable." The targets therefore represent high expectations. The 
stated rate of increase - an overall of 1 percentage point per year - 
is commensurate with that seen in Medicare fee-for-service hospitals 
over the past several years under Value Based Purchasing, which 
provides financial incentives to private hospitals to improve their 
performance on this indicator.
    On May 17, 2018, the Department of Veterans Affairs (VA) awarded 
the ten-year, multi-billion dollar Indefinite Delivery/Indefinite 
Quantity (ID/IQ) Electronic Health Record contract to Cerner. VA 
awarded the first three task orders under the ID/IQ which include 
project management, Initial Operating Capability (IOC) site 
assessments, and data hosting. At this time, VA continues to work with 
Cerner to identify and develop milestones for the implementation of the 
new Electronic Health Record. Upon, issuance of these task orders, VA 
will update the Annual Plan. Our primary milestone at this juncture is 
Initial Operating Capability 18 months from Oct. 1, 2018. The 
development of our integrated master schedules and implementation 
timelines are ongoing, and are due to VA from Cerner for by the end of 
September 2018. The Office of the Electronic Health Record 
Modernization is implementing the project and reporting to the 
Secretary in the absence of a Deputy Secretary.

    Question 52: Does VA intend to utilize a third-party auditor 
employing analytics software, similar to that used by the Centers for 
Medicare and Medicaid Services, to detect fraud by community care 
providers, distinct from the existing recovery cost audit? If so, what 
are the estimated costs of this effort?

    VA Response: VA is exploring multiple options in our efforts to 
combat fraud, waste and abuse. One new initiative is a partnership with 
Centers for Medicare and Medicaid Services (CMS) to share tools, 
techniques, and best practices related to combating fraud, waste and 
abuse. One CMS best practice we are researching is the CMS' contract 
with their Unified Program Integrity Contractors (UPIC) that use their 
own data analytics tools, in addition to the CMS provided analytics, to 
detect and prevent questionable charges. The VA/CMS partnership is not 
yet mature enough to for VA to make a determination on engaging third 
party auditors, such as the UPICs.

    Question 53: If the requested additional 605 claims processing FTEs 
are granted, how long will it take to resolve the current claims 
backlog?

    VA Response: The increase of 605 FTE is for VBA's implementation of 
appeals modernization, with the specific goals of resolving legacy 
appeals and timely processing decision reviews in the new system. 
Allocation of the FTE will be entirely to VBA's Appeals Management 
Office for purposes of accomplishing these goals. Current modeling 
indicates the legacy appeals inventory could be resolved in 
approximately 4-6 years based on current trends, assumptions and goals.
    While it is anticipated that in FY 2019 VA will be authorized to 
hire an additional 605 FTEs toward these goals, the Appeals Management 
Office is maintaining a model to project the needed disposition of 
existing FTEs during the Rapid Appeals Modernization Program (RAMP) and 
after implementation of the new system, in order to most efficiently 
handle both the legacy appeals inventory and new framework decision 
reviews. During the RAMP program, VA will gather data and conduct 
trends analyses on aspects of Veterans' behavior, to include their 
decision to opt-in to the new system, employee productivity, processing 
timeliness, and inventory measures. Moreover, the model will account 
for varying RAMP opt-in rates and will help delineate the upper and 
lower bounds of the resource requirements to work both RAMP claims and 
reduce the legacy inventory. As actual data is available and analyzed, 
a more accurate prediction of capacity needs can be formed to make 
needed adjustments both during RAMP and into actual implementation to 
create efficient claims processes.

    Question 54: Has VA considered reassigning some employees who have 
been working on processing of new claims to processing of appeals? If 
so, how many?

    VA Response: VA is continually re-assessing the best use of its 
limited resources, but at this time, VA does not intend to reassign any 
additional claims processing employees to appeals. While VA remains 
committed to addressing the pending inventory of legacy appeals, it 
must balance that commitment with the need to timely process new 
claims. As part of balancing limited resources, in early FY 2017, VBA 
realigned its appeals policy, and oversight of its national appeals 
operations, under a single office, the Appeals Management Office (AMO). 
Following this realignment, AMO provided guidance that appeals teams 
must work exclusively on appeals and cannot be used to perform non-
appeals tasks such as processing new claims. This improved focus, 
prioritization, and oversight helped VBA increase its FY 2017 appeals 
production by 24 percent. Moreover, during this time VBA processed 
approximately 1.4 million claims.

    Question 55: The budget proposal includes about $175 million for 
the Board of Veterans' Appeals, which is an increase of $19.2 million 
over last year's budget request. Please explain why the Board requires 
this increase, and how the Board will use this increase to address the 
162,000 appeals currently pending before it.

    VA Response: Currently, there are approximately 158,000 appeals 
pending at the Board. Of those appeals, approximately 84,000 have not 
been activated by the Board and are eligible to participate in RAMP. 
The 2019 request of $174.75 million for the Board is $19.15 million 
above the 2018 Budget and will sustain the 1,025 FTEs. These employees 
have already yielded positive outcomes for Veterans since FY 2017. 
Specifically, the Board is currently on pace to produce over 81,000 
decisions, which is an historic level of production.

    Question 56: What lessons have been learned in setting up the 
Office of Accountability and Whistleblower Protection, and what 
conversations have taken place with other Cabinet secretaries about the 
need to expand this type of civil service reform government-wide?

    VA Response: The Office of Accountability and Whistleblower 
Protection (OAWP) has learned several lessons while implementing this 
Act. On June 30, 2018, OAWP submitted its first annual report Congress 
which includes lessons learned and discusses processes. Of significant 
note is that OWAP found that their model for structure and mission is 
unique within the Federal Sector. The implementation required constant 
re-assessment to successfully integrate the existing tools and skills 
found with VA's current organization. OAWP has forced VA to change 
"business as usual" which always brings about a natural resistance; 
however, this discomfort is necessary for VA to achieve the 
transformation that the legislation requires. VA has documented our 
steps and lessons learned during this effort to not only provide 
transparency, but also to produce an efficient and data driven 
organization that can be replicated across the Federal government 
should the requirements of the Accountability Act be mandated of other 
Federal Agencies.

    Question 57: The budget request flat-lines the estimated number of 
vocational rehabilitation counselors at 1,442, the same number for the 
last three years. The budget also recognizes that there will be a 12 
percent increase in participants from fiscal year 2018 to 2019, 
increasing the ratio of veterans to counselors. How will a static 
number of counselors handle the increasing demand without degrading the 
program?

    VA Response: Our budget projection of Vocational Rehabilitation and 
Employment (VR&E) participants, which is based on historical use and 
projected compensation claims from FY 2018 to FY 2019 (reflected in the 
FY 2019 President's Budget) is 144,661 to 149,747 (centerline); a 3.5 
percent increase. While we expect continued future VR&E participant 
growth, we will continue to balance workload by achieving positive 
outcomes, reducing oldest cases (over 10 years), and using technology 
to enable our counselors.

    Question 58: FTEs processing education, vocational rehabilitation, 
and home loan benefits continue to be flat-lined, or nearly flat-lined, 
despite significant increases in the volume of claims in all three 
business lines. What measures is VA taking to prevent increased 
processing times from resulting?

    VA Response: Education Service continues to utilize overtime to 
address higher than usual processing times during peak workload 
periods. In addition, Education Service continues to leverage resources 
from other Regional Processing Offices (RPOs) through brokering in 
order to process claims and provide the best possible service to our 
claimants while minimizing delays in receiving benefits. In support of 
implementing the Forever GI Bill, Education Service is hiring 202 
temporary FTEs. A portion of these FTEs will assist with the 
specialized work related to the Edith Nourse Rogers STEM Scholarship 
(Section 111), Restoration of Entitlement for School Closure (Section 
109) and the Vet Tech Pilot (Section 116), and support processing 
additional claims because of changes in Forever GI Bill. VA expects to 
maintain some number of these FTEs through FY 2019, and will perform an 
initial assessment in December 2018. This preliminary assessment will 
take into account workload associated with the Forever GI Bill, what 
the FTE needs are, and whether or not the FTEs should remain temporary, 
convert to a permanent status, or a mixture of both.
    VR&E remains committed to continue working with the Office of 
Information and Technology on the development and implementation of a 
new VR&E Case Management System (CMS). The implementation of a new CMS 
will serve to increase the overall efficiency of VR&E counselors, 
helping us to transform to a digital and paperless environment. VR&E 
continues to utilize National Service Contracts to provide counseling 
augmenting services to VR&E counselors. In FY 2017, VR&E obligated 
nearly $3.5 Million for these contract services, in direct support of 
the VR&E program. For FY 2017, VR&E executed over 78 percent of our 
authorized allocation for these contract services in support of our 
vocational rehabilitation counselors. To date in FY 2018, VR&E is near 
or at the established standard of 45 days to process a claim and make 
an entitlement determination for Veterans applying to the VR&E program.
    The VA Home Loan program has experienced a tremendous volume growth 
over the last 5 years, while staffing levels remained the same. In 
order to create efficiencies, VA took a major step in creating an 
electronic loan file review process as well as developing a national 
work queue for major processes and procedures in the housing program. 
This has helped the organization manage stakeholders, by receiving and 
analyzing data from each of those reviews. The VA Home Loan program 
will continue this effort in the coming years through modernization 
with the VALERI-R initiative. Through advanced data analysis and 
reporting, VALERI-R will provide improved oversight and transparency of 
lender and servicer performance, as well as improved efficiency in 
benefit delivery. This will enable Veterans to better evaluate loan 
options and statuses while VA addresses high-risk programmatic 
challenges with data driven solutions.

    Question 59: Does the budget proposal fully support implementation 
of the Forever GI Bill, to include necessary IT improvements?

    VA Response: VA does not foresee any delays in its implementation 
efforts for Forever GI Bill, and regularly reviews and updates its 
established project management schedule to highlight and mitigate any 
potential lapses. With the expected implementation of the most critical 
Forever GI Bill provisions through an IT solution - Sections 107 and 
501 - VA hired 202 temporary FTEs in May 2018 to accommodate any 
increase in claims processing and the administration of new programs 
associated with the Forever GI Bill. The Office of Information and 
Technology is deferring IT solutions for the remaining Forever GI Bill 
sections until FY 2019, after the bulk of the Benefits Delivery Network 
is decommissioned to have a more modern technology stack on which to 
either make remaining changes or position the Department to be able to 
pursue alternative service offerings.

    Questions for the Record from Rep. Bilirakis:

    Question 60: The budget request includes $727 million for direct 
medical research, a 14 percent increase over fiscal year 2018 levels. 
One of my priorities on the Committee is to examine efforts to improve 
research and treatment for veterans who may be experiencing negative 
health effects due to toxic exposure such as burn pit inhalation during 
their military service. What is the VA doing to further this goal?

    VA Response: The Office of Research and Development (ORD) is 
undertaking multiple approaches in the effort to progress knowledge 
forward of long-term health effects caused by airborne and open burn 
pit hazards. Based on the Institute of Medicine, Research Advisory 
Committee, and physician-driven recommendations, investigator-initiated 
as well as intra- (VA) and inter- (National Institute of Health and 
DoD) governmental partnerships are ongoing. These efforts include 
prospective and longitudinal studies, molecular and biomarker 
discovery, genetic phenotyping, pre-clinical modeling, and clinical 
trials. In some studies, biorepositories have been developed to store 
biospecimens collected from Gulf War Veterans for ongoing and future 
research. Additional cost-estimate research has been initiated from the 
Health services research and development service. See below for 
highlights:

VA Investigator initiated projects:

    VA ORD also solicits proposals from individual VA investigators for 
research projects related to the health of Veterans of Operations 
Enduring Freedom, Iraqi Freedom, and New Dawn. The request for 
applications issued by ORD is entitled "Merit Review Award for 
Deployment Health Research (OEF/OIF/OND)," and it lists the health 
effects of burn pits as a specific area of emphasis for this research.
    VA ORD is currently funding the following single-site research 
projects which deal with respiratory health issues in this population:

      Targeting HSC-derived Circulating Fibroblast Precursors 
in Pulmonary Fibrosis; Investigator: Amanda C. LaRue, PhD; Charleston, 
SC (10/1/2013-9/30/2018): Exposure sand and other airborne particulates 
cause pulmonary fibrosis (scarring) which reduces the ability of the 
lung to function properly, and this study is designed to determine the 
mechanism by which fibrosis-inducing cells develop (in mice) from 
hematopoietic stem cells (HSCs) and to determine if their presence can 
be used as an early biomarker for this condition.
      Mechanisms of Cigarette Smoke-Induced Acute Lung Injury; 
Investigator: Sharon Rounds, MD; Providence, RI (7/1/2015-6/30/2019): 
This study is designed to understand the mechanism by which acrolein, a 
component of cigarette smoke and burn pit smoke, damages lung cells and 
leads to respiratory difficulties and conditions like Acute Respiratory 
Distress Syndrome (ARDS) and COPD.
      Pulmonary Vascular Dysfunction after Deployment-Related 
Exposures; Investigator: Michael Falvo, PhD; East Orange, NJ (10/1/
2017-9/30/2021): Small particulate material can deposit in the lungs 
and prevent the lungs from properly exchanging oxygen with the blood. 
In this study, gas exchange will be measured, and in cases where there 
is damage to the lungs, changes in blood chemistry will be monitored to 
develop laboratory tests that will be useful for diagnosing the 
condition.

Intra-VA and Inter-partnership projects: 

    Based on a 2011 Institute of Medicine report, a prospective study 
of the long-term health effects of deployment-related exposures in 
military personnel was recommended. VA investigators have designed a 
study that aims to assess the link between land-based deployment in 
Iraq, Afghanistan, Kuwait, or Qatar with the current pulmonary health 
of a representative sample of Army, Marine, and Air Force personnel.

      Pulmonary Health and Deployment to Southwest Asia and 
Afghanistan; Study Chairs: Eric Garshick, MD and Susan Proctor, DSc, 
Boston, MA; Paul Blanc, MD, San Francisco, CA (5/1/2016-9/30/2022): 
This two-phase, cross-sectional cooperative study consists of a survey 
and clinical examination of a representative sample of Veterans (Army, 
Marine, and Air Force personnel). Phase 1 collects self-reported health 
and military service information from a national sample through a mail 
survey or telephone interview. Phase 2 consists of in-person data 
collection procedures, including more extensive health, military 
service, and exposure questionnaires and pulmonary function testing. A 
pilot study is determining the optimal methods for recruiting 
participants, assessing participation rates and other factors that may 
influence participation, and demonstrating the feasibility of the 
techniques being used to reconstruct the levels of individuals' past 
exposures to particulate matter. These techniques, recently reported on 
in three journal articles by VA researchers and colleagues from Harvard 
and other institutions, involve the use of satellite data and airport 
visibility readings to help map pollution patterns and exposures that 
may have affected troops. Data from the National Aeronautics and Space 
Administration will be used to help with efforts to conduct this state-
of-the-art approach to studying airborne exposures. Approximately 
10,000 Veterans will be recruited at a total of six sites to 
participate in surveys and pulmonary function tests (PFTs). The results 
of current PFTs will be linked to each Veteran's exposure to 
particulate matter in the air during deployment.

    Question 61: The budget request includes $8.6 billion for veterans' 
mental health services. Part of this funding accounts for the critical 
one-year period following uniformed service and transition to civilian 
life. The Committee has had multiple hearings and roundtables on the 
transition assistance process. Please detail the measures VA expects to 
take over the next year to improve this transition process.

    VA Response: VA plans to improve the transition process for 
Servicemembers during the critical 1-year period following uniformed 
service to civilian life through the following efforts:

      Developed a module within the revised Transition 
Assistance Program (TAP) VA Benefits I and II curriculum specifically 
addressing how transitioning Servicemembers can maintain their health 
following transition which includes a section on emotional wellness. 
Additionally, the section provides awareness of the growing number of 
people who are diagnosed with depression, and lists resources offered 
by VA for suicide prevention (e.g., crisis hotlines, websites, and 
support organizations).
      Implementing facilitated health care registration, which 
is an increased effort to register transitioning Servicemembers in VA 
health care by submitting their Application for Health Benefits (VA 
Form 10-10EZ) while they are in the VA Benefits I & II Briefings. This 
process will result in eligible Veterans having their applications 
adjudicated immediately after military separation or discharge.
      Leveraging VA Whole Health peer outreach and wellness 
groups to address transitioning Servicemembers' and Veterans' mental 
health needs, in addition to Transition Care Management and more 
traditional mental health services.
      Collaborating with interagency partners to collect 
feedback on post-separation outcomes via a post-separation assessment. 
Implementation of the assessment will give VA the opportunity to ensure 
TAP is employing the right tactics to help our Servicemembers 
transition successfully. It will also allow us to conduct data-driven 
evaluation of the effectiveness of TAP and the long-term impact of 
interagency transition services. Additionally, VA is working with 
interagency partners to review "at risk" populations for 
identification, tracking, and servicing to enhance effectiveness.
      VA and DoD are working collaboratively to extend the 
availability of Military One Source resources for a full year following 
discharge.

    Question 62: The Bay Pines Health System recently experienced major 
facilities problems in a domiciliary housing homeless veterans; the 
building lacked heat and hot water for months. I escalated the issue to 
the Secretarial level and appreciate the swift action that was, at that 
point, taken. However, I am baffled as to why quicker action wasn't 
taken at the local level. Please further explain why this situation was 
allowed to develop and why the Health System or VISN did not address it 
earlier-was it a lack of dollars, or merely a lack of common sense in 
prioritizing dangers to the health and wellbeing of our most vulnerable 
veterans?

    VA Response: VA has numerous contingency plans for mitigating any 
risk and ensuring the overall safety and well-being of Veterans; we 
also have access to numerous resources and expertise across the 
organization. The specific situation with Bay Pines VA Health System 
(BPVAHCS) was due to issues that occurred when powering up their 
outbuildings' post Hurricane Irma; which is a required and critical 
part of their emergency operations plan for sustainment. Appropriate 
oversight and guidance is sought through the appropriate channels, in 
this case additional technical guidance was sought through Contracting 
and Office Capital Asset Management Engineering and Support.
    Mental Health leadership and care team members continually assessed 
Veteran concerns as they were raised. The total time from when the 
decision was made to replace the steam line end to end, to the time 
that a contract was awarded, was approximately 60 days. This is not an 
unrealistic timeframe as a full assessment of the project needed to 
happen to ensure it was appropriate in scope and complexity. This is a 
required element of the contracting process to ensure that all 
technical and safety specifications maintain compliance with industry 
and VHA standards.

    Question 63: The budget proposal includes a narrative that the 
separate Community Care account, which has existed for the last several 
years, has restricted VA medical center directors from managing their 
budgets effectively. Please provide specific examples of this.

    VA Response: The Budget proposes to merge the Medical Community 
Care appropriation with the Medical Services appropriation, as was the 
case prior to 2017. The current multiple medical care appropriations 
structure, including mandatory and discretionary resources, presents a 
significant administrative burden to the Medical Center Directors. 
While not insurmountable, it does not permit the Medical Center 
leadership to easily leverage all the tools available for providing 
Veterans with the care they need. Having both Medical Services and MCC 
aligned under one appropriations account would allow Medical Center 
Directors the flexibility needed to expediently address care-related 
issues in ways that are beneficial to our Veterans.

    1. Prior to the implementation of the MCC account, VA medical 
centers locally allocated funds between VAMC salaries and care in the 
community, ensuring Veterans had timely access to care. This 
flexibility was lost with the inception of the MCC account. This 
proposal allows the previous flexibility while ensuring timely access 
to care and to strategically and efficiently use the funds. Below are 
specific examples:

    a. A VA Medical Center has a physician vacancy that has been 
unfilled for some time, but is able to finally hire someone for that 
position. Because the workload associated with this new hire would have 
been reflected in community care in the recent past, the VAMC would 
like to move the funds back in-house and provide the care at lower 
cost, rather than purchasing it from the community. Under the current 
appropriation structure, moving this position from community care back 
into VA requires a time consuming transfer process, and in the interim, 
and the VAMC must identify in-house funding offsets, that could limit 
clinical care in another area.

    b. A rural VAMC provides 1,200 sleep studies each month through 
care in the community at a cost of $864,000 a year. Total estimated 
staffing and supply costs to bring those services in-house is estimated 
to be $450,000 a year, but the process of transferring funds between 
appropriations accounts is time consuming and administratively 
burdensome causing the medical center to purchase sleep studies in the 
community at almost twice the cost of providing the care in-house.

    c. A VAMC has sufficient operating room capacity, outpatient 
clinical space, and equipment to provide clinical services, but lacks 
the flexibility to convert community care funds to medical services 
funds in a timely manner. As a result, the operating rooms may sit idle 
since the VAMC cannot access "community care funds" to pay for these 
procedures in-house.

    2. The current multiple medical care appropriations structure also 
negatively impacts existing sharing agreements with adjacent university 
hospitals. VA sharing agreements are funded with the Medical Services 
appropriation. When medical centers exceed the annual allotted budget 
for the sharing agreement(s), the medical center is required to send 
Veterans for care in the community for the remainder of the fiscal 
year. For specialty care, such as orthopedic surgeries, the cost is 
frequently much more costly than through the sharing agreement. With a 
consolidated account, a VAMC could provide these services in-house, 
likely at a lower rate than what may be available in the community

    3.Strategic investment in capital equipment and staffing is limited 
without the flexibility to transfer funds expeditiously between 
appropriations. With the combined appropriation medical center 
directors will have more flexibility to reallocate the MCC funds to 
purchase necessary equipment as well as to fund necessary salaries. As 
one specific example, a VAMC currently sends out all low-dose 
Computerized Tomography scans to the community at an average cost of 
$200 a scan. The VAMC would like to realign the community care funds to 
provide this service in-house at an average cost of $125 with equipment 
and staff capacity.

    Question 64: What measures is VA taking to involve community health 
centers in the planning of community care consolidation, and what role 
is envisioned for them when consolidation is implemented?

    VA Response: The VA Community Care Network (CCN) Contract Request 
for Proposal (RFP) provides language for the CCN contractors to make 
every reasonable attempt to ensure access to federally Qualified 
Healthcare Centers as part of CCN. The CCN RFP does not specifically 
address community health centers (CHC). The CCN RFP does require the 
CCN contractor to customize the network for each VA Facility therefore 
the VA Facility leadership can request the CCN Contractor to engage 
local CHCs.

Question for the Record from Rep. Bost:

    Question 65: The budget includes a request for $172 million for the 
Office of Inspector General to strengthen accountability. Will this 
level of funding be sufficient to properly enforce accountability 
throughout the VA?

    VA Response:  OIG will respond directly to Rep. Bost and will 
provide OCLA with a copy (Gromek).

    Question 66: Do you need any new authority to establish clearer cut 
qualifications for positions within VA, such as Human Resources?

    VA Response: The Human Resources Management - GS-0200 series is 
under Title 5 and as such, is covered by the Office of Personnel 
Management's (OPM) General Schedule Qualification standards. These 
standards are written broadly for Government-wide application and are 
not intended to provide detailed information about specific 
qualification requirements for individual positions at a particular 
agency. It is important to note that all Federal agencies use the OPM 
approved qualification standards, and creating VA specific standards, 
would negatively impact VA's ability to recruit human resources (HR) 
professionals from other Federal agencies and retain current HR staff. 
OPM states that such information (i.e., a description of the 
specialized experience requirements for a particular position) should 
be included in the vacancy announcements issued by the agency. As such, 
rather than standardized qualification requirements across VA, 
individual vacancy announcements are customized to reflect the 
specialized experience (qualification requirements) for the particular 
position itself. VA already utilizes this method of applying 
specialized qualification requirements in all HR job announcements. 
Additionally, performance standards are developed on an annual basis 
for each HR position in the Department. These performance standards are 
aligned with the specific functions and specialized area of HR being 
performed by each HR professional.

Question for the Record from Rep. Poliquin:

    Question 67: The budget request includes $25 million to reimburse 
the Judgment Fund. Will this zero out VA's liabilities to the Judgment 
Fund?

    VA Response: No. The outstanding Judgment Fund reimbursement to 
Treasury is $229.9 million for nine projects. The FY 2018 appropriation 
of $10 million for the Judgment Fund will leave a balance of $219.9 
million. The FY 2019 requested appropriation of $25 million will leave 
a balance of $194.9 million and serves as a down payment to address the 
overall requirement.

Questions for the Record from Rep. Dunn:

    Question 68: VA's suggested Major Construction appropriation 
language includes the following. Please explain the intended meaning 
and effect of, "regardless of the estimated costs of the project." B
    .of which $400,000,000 shall be available for seismic improvement 
projects and seismic program management activities regardless of the 
estimated costs of the project.

    a. Please explain how VA has changed the prioritization of seismic 
projects in the existing SCIP process.

    VA Response: The use of the word "regardless" is a technical change 
to clarify that major funds could be used for seismic needs/projects 
that were partially funded by the Minor, Medical Facilities and 
National Cemetery accounts:
    ".and of which $480,000,000 shall remain available until expended, 
of which $400,000,000 shall be available for seismic improvement 
projects and seismic program management activities regardless of the 
estimated costs of the project."
    Seismic is still a high priority and included in the SCIP process - 
as it has been in previous years. For 2019, seismic projects shown in 
the SCIP 2019 prioritized list were not included in the minor or NRM 
funding request and would be funded out the newly created seismic fund.

    b. Please explain why, after this change, creation of a separate 
seismic fund and project ranking list is necessary.

    VA Response: A separate seismic initiative fund is necessary to 
more effectively and efficiently meet significant critical seismic 
corrections for VA buildings at various locations across the Nation. VA 
has identified a seismic risk in excess of $7 billion at its 
facilities. The proposed seismic fund would correct singular buildings, 
as opposed to campus wide corrections. Projects would be limited to 
providing similar functions and maintain original purpose. Further, the 
reduction of some legislative requirements will allow for quicker 
correction of documented deficiencies. This initiative will allow VA to 
move forward quickly and without delay to address the critical seismic 
issues that are currently putting Veterans, staff, and other VA 
visitors at-risk.

                                 
                               ROE TO OIG
    The Honorable Phil Roe, M.D. Chairman
    Committee on Veterans' Affairs
    U.S. House of Representatives
    Washington , DC 20515

    Dear Mr. Chairman:

    Enclosed is a response from the Office of Inspector General (OIG) 
to a question for the record received from Congressman Mike Bost 
following the February 15th hearing before the Committee on the U.S. 
Department of Veterans Affairs Budget Request for Fiscal Year 2019. We 
request that it be added to the hearing record.

    Thank you for your interest in the OIG.

    Sincerely,

    MICHAEL J.MISSAL

    Enclosure

    Copy to: The Honorable Tim Walz, Ranking Member
    The Honorable Mike Bost

      Office of Inspector General, Department of Veterans Affairs 
               Response to Questions for the Record from
            House Committee on Veterans ' Affairs Hearing on
U.S. Department of Veterans Affairs Budget Request for Fiscal Year 2019

    65. The budget includes a request for $172 million for the Office 
of Inspector General to strengthen accountability . Will this level of 
funding be sufficient to properly enforce accountability throughout the 
VA?

    VA Office of Inspector General Response: The budget request for the 
Office of Inspector General (OIG) for fiscal year (FY) 2019 of $172 
million will not be sufficient for the OIG to fully meet its mission of 
effective oversight of the programs and operations of VA While that 
amount would represent an increase over the OIG's funding of $164 
million for FY 2018, it falls short of even the OIG's actual FY 2018 
operating budget of $175.5 million (which includes $15.9 million of 
carryover due to a late hiring cycle that was out of synch with the 
budget cycle).
    There will not be a carryover of that size for FY 2019 as those 
funds will have been expended primarily on new hires to conduct our 
oversight work. In addition, we are now funding our Office of Contract 
Review approximately $5 million that was previously paid by VA through 
a reimbursable agreement, and there are other increased costs in FY 
2019. Consequently, an FY 2019 appropriation of $172 million would 
require adecrease of about 28 OIG staff. This would result in a likely 
curtailment of some of our oversight priorities if OIG staffing and 
resources decrease at a time when VA is experiencing growth, including 
large and complex projects such as VA's new electronic health records 
initiative , improving VA's financial systems, enhancing and 
consolidating VA's IT systems, and expansion of community care 
programs. The OIG will need additional funds to not only conduct 
oversight of these costly programs, but also to expand our 
investigations of other high-risk VA programs, such as construction, 
procurement, education benefits, and the delivery of timely and quality 
healthcare. The VA OIG's staffing is among the smallest ratio of 
oversight staff to agency staff across the Inspector General community. 
Moreover, the OIG budget represents less than .1 percent of VA's 
overall budget, which again is less than a significant number of OIGs 
at other cabinet level agencies. An FY2019 appropriation of $172 
million will undermine progress achieved to "right size" the OIG 
oversight capacity to the growth and demands of VA's new initiatives.

                                 [all]