[Congressional Record Volume 142, Number 137 (Saturday, September 28, 1996)]
[Senate]
[Pages S11642-S11658]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




          VETERANS' HEALTH CARE ELIGIBILITY REFORM ACT OF 1996

  Mr. NICKLES. Madam President, I ask unanimous consent that the 
Veterans Affairs Committee be discharged from further consideration of 
H.R. 3118, and that the Senate proceed to its consideration.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The clerk will report.
  The assistant legislative clerk read as follows:.

       A bill (H.R. 3118) to amend title 38 of the U.S. Code to 
     reform eligibility for health care provided by the Department 
     of Veterans Affairs.

  The PRESIDING OFFICER. Is there objection to the immediate 
consideration of the bill?
  There being no objection, the Senate proceeded to consider the bill.


                           Amendment No. 5414

                   (Purpose: To provide a substitute)

  Mr. NICKLES. Madam President, Senator Simpson has a substitute 
amendment at the desk. I ask for its immediate consideration.
  The PRESIDING OFFICER. The clerk will report.
  The assistant legislative clerk read as follows:

       The Senator from Oklahoma [Mr. Nickles], for Mr. Simpson, 
     for himself and Mr. Rockefeller, Mrs. Hutchison, Mr. Akaka, 
     Mr. Murkowski, and Mr. Wellstone, proposes an amendment 
     numbered 5414.

  Mr. NICKLES. Madam President, I ask unanimous consent that reading of 
the amendment be dispensed with.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  (The text of the amendment is printed in today's Record under 
``Amendments Submitted.'')
  Mr. SIMPSON. Madam President, the legislation now before this body 
may be one of the most significant veterans' bills of the last few 
years. In agreeing to this bill, the Congress will make, under the 
rubric of health care ``eligibility reform'', changes in the nature

[[Page S11643]]

of our Nation's health care commitment to veterans that are more far-
reaching than any decision since the end of World War II.
  The Congress faces the issue of setting priorities for VA care 
because all 26 million veterans are eligible for VA health care. 
However, VA care is not an entitlement. VA provides as much care to as 
many veterans as resources allow.
  Our Nation's historic commitment to veterans is to care for the 
wounds of war, that is, to care for service-connected disabilities. The 
VA hospital system was created to fulfill that obligation. And, having 
created a network of hospitals--now numbering 173--it made good sense 
to put it to use caring for non-service-connected veterans when space 
was available. That is how VA got into the business of caring for non-
service-connected conditions and veterans.
  As so often happens, the world changed over time, while VA and the 
laws that govern VA lagged behind. Over time, the non-service-connected 
tail began to wag the service-connected dog. Today, 89 percent of VA's 
medical workload is care for non-service-connected conditions. VA built 
a hospital system at a time when the terms ``hospital care'' and 
``medical care'' were synonymous. Today, American medical care is 
rapidly moving out of hospitals and into the outpatient arena. VA is 
also moving in that direction. But, VA's movement has been hampered by 
statutory ``eligibility'' rules which set priorities reflecting VA's 
hospital-based infrastructure. VA medical centers are underutilized and 
VA has excess beds.
  This fact is reflected in the eligibility rules which give a large 
number of veterans, perhaps 10 million, priority access to inpatient 
hospitalization.
  Outpatient care is the bottleneck in the VA system and only a small 
number of veterans, about 500,000, have guaranteed access to a complete 
continuum of care. In addition, 2.2 million veterans receive whatever 
care is needed for their service-connected disabilities, and other 
veterans have conditional access to outpatient care.
  The eligibility rules set by Congress are really a way to ration care 
by setting priorities. They allow VA to live within its resources.
  However, they have two major faults: first, they are very complex. 
Second, they stand modern medical practice on its head by making it 
easier to provide inpatient care than outpatient care.
  The easy to describe--and from a medical point of view, desirable--
fix would be to simply eliminate the distinction between inpatient and 
outpatient care and direct VA to provide care in the most cost-
effective therapeutically appropriate manner.
  There are two ways to do this. We could direct VA to provide complete 
care--including outpatient--to all of the veterans now ``mandatory'' 
for inpatient care. However, giving new access to outpatient care, 
including virtually free prescription drugs and prosthetic devices such 
as hearing aids, to millions of additional veterans could be very 
expensive.
  Or, the Congress could direct VA to provide complete care, but only 
to the number of veterans who could be served with a budget equal to 
VA's current funding level. This would make VA's rules simple and allow 
the most cost-effective care. However, $17.1 billion may not fund a 
full continuum of care for all of the veterans who are now 
``mandatory'' for inpatient care. If the Congress takes this course, we 
could be accused of ``taking away a veterans' benefit'' from those 
veterans excluded under the new rules.

  There are savings to be realized by moving treatment out of hospitals 
and into less expensive ambulatory care. However, CBO costed 
unconstrained bills directing that course as being in the billions of 
dollars.
  As I read the CBO estimates, improved and expanded health care 
benefits will draw new veteran patients who do not now use VA care and 
the cost of their care would more than offset the savings of moving 
some inpatient care into the outpatient arena. For Federal budget 
purposes, VA health care is ``discretionary'' rather than ``mandatory'' 
spending. CBO cost estimates show how much it will cost to provide the 
care which ``eligibility reform'' proposals would authorize. Since VA 
health care spending is ``discretionary'', this is not a ``pay-go'' 
cost for which offsets must be found. However, appropriators are bound 
by a ceiling on discretionary spending and they could fund the 
``promised'' care only if they reduced other discretionary programs, 
unless eligibility reform legislation imposes its own limits on the 
obligations of the taxpayer to fund VA health care.
  VA, the Veterans Service Organizations, (VSO's), and others dispute 
CBO's analysis. They have stated that if the Congress reforms the rules 
under which VA operates the resulting efficiencies will pay for, or 
perhaps even more than pay for, the cost of the additional care. The 
Veterans' Affairs Committee has taken them at their word. The 
legislation we now bring before the Senate caps VA medical care 
spending at $17.250 billion for 1997 and $17.9 billion in 1998. I 
expect those caps to be extended into the future at a level reflecting 
any increases in the cost of providing health care and taking into 
account the declining veteran population.
  Current eligibility rules do really stand modern medicine on its head 
by making it easier to treat a veteran on an inpatient basis than in a 
non-hospital, outpatient setting. Many advocates for eligibility reform 
point to the need for changes in the law in order to allow VA the 
freedom to bring itself up to date. I note, however that VA has 
informed the Committee that it is moving rapidly to a primary care 
model for medical care under the current rules. VA's Under-Secretary 
for Health, Dr. Kenneth Kizer,--one splendid administrator--in a May 
10, 1996 letter to the Veterans' Committee's distinguished ranking 
minority member, Senator Rockefeller, deemphasized sound medicine as a 
reason for seeking ``eligibility reform''. He instead said that he 
needs eligibility reform in order to instill respect for the law 
(asserting that VA clinicians feel they must evade rather than follow 
statutory criteria), in order to provide a mechanism for him to hold 
the field management accountable to the taxpayers, and to allow him to 
design an efficient system of care.
  Madam President, these are all worthy and desirable goals. I support 
them. But they are goals driven by sound public administration, not a 
crisis. The legislation now before the Senate will allow the able Dr. 
Kizer to pursue those goals.
  This legislation makes some real choices and I expect its enactment 
to have real consequences.
  Current priorities for VA health care favor veterans who are service-
connected, or poor, or who are members of special groups (former POW's, 
World War I, exposed to radiation, agent orange, Persian Gulf).
  Changing these priorities requires a Congressional decision as to the 
Nation's health care obligation to veterans. When care was rationed by 
hospital bed availability it was easy to set limits. If we move to 
ambulatory care, constrained only by funding, and do not want to, or 
can not, create a new entitlement, it will be necessary to set explicit 
limits on who will be served.
  In approving this legislation, the Congress will answer questions as 
basic as:
  First, Should VA care for all disability and illness for service-
connected veterans, or just the service-connected conditions? If yes, 
for all service-connected veterans or just some of them? If just some 
of them, which ones?

  Second, Should VA serve as a social safety net for ``poor'' veterans? 
If yes, how poor?
  Third, Should VA provide the same general medical services as the 
private sector or should it focus on providing veterans with services 
not generally available in the private sector (such as long term 
psychiatric care, or lifetime treatment of spinal cord dysfunction?
  Madam President, reform even opens the door to the question of VA's 
role as a direct care provider. Should VA continue to provide care 
itself or should it fund private sector care for eligible veterans?
  Madam President, I would like to take a moment to describe the 
eligibility reform provisions of the bill and then discuss how the bill 
answers the questions this issue puts before the Congress and the 
implications of some of those answers.
  First, and most importantly, the bill eliminates the distinction 
between inpatient and outpatient care. VA is directed to provide 
hospital care and

[[Page S11644]]

medical services in the most clinically appropriate setting for the 
veterans it treats. However, and this is important, the fully 
discretionary nature of eligibility for nursing home care remains 
unchanged. In addition, VA is required to maintain special programs 
(such as treatment for spinal cord dysfunction, blind rehabilitation, 
amputation, and mental illness) at least at the current level. On a per 
capita basis, these services are expensive to provide and it is not the 
intent of the Committee to allow VA to reduce them in order to pay for 
other kinds of routine care. This decision means that VA will be forced 
to reduce the number of veterans it treats for routine conditions and 
diseases in order to sustain its effort for the unique services it 
provides. In many cases, VA is a national leader for these services 
and, in this regard, VA is truly a national asset.
  Second, the legislation does not create an entitlement to health care 
for veterans. Funding for veterans' health care has always been 
considered discretionary spending and the benefits provided by this 
bill are explicitly subject to the availability of appropriations. As I 
noted earlier, the amount of appropriations authorized is capped at 
about the current level of effort, $17.25 billion for 1997 and $17.9 
billion for 1998.
  Third, VA is directed to manage access to its health care system by 
enrolling veterans according to the following priorities:
  First, veterans with service-connected disabilities evaluated 50 
percent and greater.
  Second, veterans with service-connected disabilities evaluated at 30 
percent and 40 percent disabling.
  Third, former POW's and veterans with 10 percent and 20 percent 
service-connected disabilities.
  Fourth, catastrophically disabled veterans and veterans in receipt of 
increased non-service-connected disability pension because they are 
housebound or in need of the aid and attendance of another person to 
accomplish the activities of daily life.
  Fifth, veterans unable to defray the cost of medical care, as 
prescribed by VA in regulation.
  Sixth, all other veterans in the so-called ``core'' group including 
veterans of WWI, and veterans with a priority for care based on 
presumed environmental exposure.
  Seventh, all other veterans.
  VA will be authorized to establish subdivisions for enrollment within 
priority groups. 1997 and 1998 will be a transition period with 
enrollment required for treatment after September 30, 1998. VA will, of 
course, continue to treat service-connected conditions (and veteran 
service-connected 50 percent and higher) without regard to enrollment. 
Other veterans will need to be enrolled if they are to receive VA care 
and VA will enroll only the number of veterans it will be able to treat 
with the resources available to it.
  Madam President, this bill will change the way VA does business and 
it has the potential to change the characteristics of the veterans in 
our States who will have a realistic expectation of receiving VA care. 
Veterans with non-compensable service-connected disabilities will no 
longer have an automatic priority for care. However, by giving a high 
priority for enrollment to all veterans with compensable service-
connected disabilities we will create a population of 2.2 million 
veterans who can expect VA to provide a complete continuum of care, 
including such services as free or virtually free prescriptions, which 
are not covered by Medicare. If this expansion of services draws large 
numbers of these veterans to the VA system, then veterans with a low 
priority for care, including the low-income veterans who now make up a 
large proportion of VA's patients, may not receive full care. The 
alternative to this would have been to give a low priority to veterans 
with minor service-connected disabilities, but that option was not 
acceptable to the members negotiating the legislation. This outcome is 
made more likely by the decision to freeze VA's level of effort in its 
special, but expensive, services. A possible outcome of this bill will 
be a VA system that primarily treats service-connected veterans for 
their non-service-connected conditions and veterans whose disabilities 
or illnesses make them candidates for treatment in one of VA's 
specialized programs. Of course, this outcome will not come about if VA 
and the Veterans Service Organizations are correct and the efficiencies 
this bill will allow VA to realize are adequate to pay for the 
additional services provided to veterans newly attracted to the VA 
system. We will see veterans turned away if the Congressional Budget 
Office and General Accounting Office are correct and liberalized rules 
lead to dramatic numbers of new veterans seeking free VA care.
  Madam President, I also ask my colleagues to be aware of the effect 
of the increased VA efficiencies necessary if it is to continue to 
treat its current low income patients. Because VA's resources will 
remain constrained, we can expect VA to accelerate the already underway 
process of reevaluating the desirability of continuing to support 
underutilized and inefficient ``infrastructure''. In a word, we will 
see some hospitals closed and mission changes for many others. To his 
clear credit, VA's Under Secretary for Health, Dr. Ken Kizer, has 
already made more progress in this direction than any other Under 
Secretary or Chief Medical Director in my time in Congress. And, I 
believe he would continue that process with or without this 
legislation. He deserves our highest praise for that. However, I think 
it safe to predict that every unpopular decision to close a hospital, 
or limit or redirect a service, will be attributed to this legislation. 
Since those changes will be the very changes needed to transform VA 
from a 1945 system of hospitals into a twenty-first century health care 
system, we should thank those who often point their fingers in our 
direction--for giving us the credit. If Veterans' Service Organizations 
in our States voice complaints about the outcome of this legislation, 
we should remind them of the old saying about being careful what you 
ask for because you may get it!
  Madam President, this amendment goes beyond reform of the rules 
governing access to VA medical care, and I will take a few minutes to 
summarize some of the major provisions for the benefit of my 
colleagues.
  It extends VA's authority to treat Persian Gulf veterans with 
disabling symptoms, but for which no disease can be diagnosed. It also 
extends to December 31, 1998 VA's authority to provide health 
examinations to the families of Persian Gulf veterans. This authority 
originally ended September 30, 1996, but unless the deadline is 
extended, delays in putting the program into effect would result in a 
substantially shorter time frame for VA to provide these exams than was 
contemplated by the Congress when the authority was originally enacted.
  In addition, it extends VA's authority to care for veterans presumed 
to have been exposed to Agent Orange or radiation, and also takes a 
necessary step to exclude from that treatment authority those diseases 
for which there is evidence that exposure is not the cause.
  The amendment, authorizes the construction of 18 major construction 
projects. I am pleased that we have made the turn away from VA's past 
emphasis on the construction of inpatient hospital facilities and are 
beginning to expand the proportion of scarce resources allocated to 
ambulatory care. I urge my successors to reenforce this shift in 
emphasis as ambulatory care is the bottleneck in the VA system and the 
``eligibility reform'' provisions of this bill will bring VA even more 
veterans seeking care on an ambulatory care basis.
  The bill authorizes ambulatory care projects in Honolulu, HI ($43 m), 
Brockton, MA ($13.5 m); Shreveport, LA ($25 m); Lyons, NJ ($21.1 m); 
Tomah, WI ($12.7 m); Asheville, NC ($26.3 m); Temple, TX: ($9.8 m); 
Tucson, AZ ($35.5 m); and Leavenworth, KS ($27.75 m). In addition, it 
authorizes patient environment improvement projects in Lebanon, PA 
($9.5 m); Marion, IL: ($11.5 m); Omaha, Neb. ($7.7 m); Pittsburgh, PA: 
($17.4 m); Waco, TX ($26 m); Marion, IN ($17.3 m); Perry Point, MD 
($15.1 m); and Salisbury, NC ($18.2 m). It also authorizes correction 
of seismic deficiencies at Palo Alto, CA ($20.8 m) and leases of 
outpatient clinics in Allentown, PA ($2.159 m); Beaumont, TX ($1.940 
m); Boston, MA ($2.358 m); San Antonio, TX ($2.256 m), (also includes a 
VBA office); Toledo, OH ($2.223 m); and a parking facility in 
Cleveland, OH ($1.3 m).
  In other construction provisions, the amendment directs VA to submit 
an

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annual report with a 5-year strategic plan showing each of the 22 
Veterans Integrated Service Network's (VISN) facility needs and plans 
for meeting those needs, and a listing of VA's 20 highest priority 
construction projects with the category, priority score and priority 
rank for each. Additional information will also be required in the 
prospectus for each project, especially on projected workload and 
costs. The threshold separating minor from major construction increased 
from $3 million to $4 million. The ``grandfathered'' authorization of 
projects already in the works when the authorization requirement was 
established will be eliminated. Future construction projects will 
require an affirmative authorization by the Congress. VA will also be 
required to give the Congress 30 days notice before obligating more 
than $500,000 for advance planning.
  Eligibility reform will call upon VA to break out of the mold created 
by its historic dependence on its physical infrastructure. This 
amendment will assist in that process by expanding the types of 
providers with which, as well as the types of services for which, VA 
would be able to enter into sharing agreements. The amendment would 
also allow VA to use a simplified procedure for complying with Federal 
procurement processes when contracting with commercial providers.
  The amendment would also make permanent VA's authority for CHAMPUS 
sharing agreements, an authority now expiring September 30, 1996.
  The ``notice and wait'' period for VA reorganizations is reduced from 
90 to 45 days, 30 of which must occur while Congress is in session.
  The bar on VA contracting for patient care (which is now suspended 
through 1998) is deleted, with a requirement that VA report to Congress 
in advance of any contracting proposal.
  The amendment has significant provisions relating to medical services 
for women veterans. It would require accreditation of VA mammography 
programs and require VA to adopt and enforce mammography quality 
control and quality assurance standards. Since VA is already in 
compliance with these provisions, their enactment will have the effect 
of codifying VA's current policy and practice. In addition, VA would be 
directed to survey its facilities in order to identify privacy 
deficiencies and to incorporate a correction plan into its construction 
planning process. VA would also be directed to assess the use, and 
barriers to use, of VA services by women veterans and to report on its 
findings, recommendations, and the correctional steps it has taken in 
response to those findings.
  The Readjustment Counseling Service program administered through 
community based ``Vet Centers'' would be updated. Mandatory counseling 
eligibility would be limited to combat theater veterans (with 
nontheater Vietnam-era veterans ``grandfathered'' in if they become Vet 
Center clients before January 1, 2000). The Advisory Committee on the 
Readjustment of Veterans would be given statutory recognition. VA would 
be directed to report to the Congress on the feasibility and 
desirability of collocating Vet Centers and outpatient clinics or 
providing some medical services at Vet Centers.

  VA would be directed to establish up to five Mental Illness Education 
Research and Clinical Centers [MIRECCs]. The centers established would 
be chosen from proposals through a peer review process. They would be 
located in various geographic regions, at sites linking tertiary care 
and primarily psychiatric VA Medical Centers [VAMCs]. In addition, the 
Committee on Care of Severely Chronically Mentally Ill Veterans would 
be made a statutory committee and VA would be required to forward its 
reports to the Congress.
  VA would be directed to conduct research evaluating the most cost 
effective and efficient way to provide hospice care to veterans, with a 
report due to the Congress by April 1, 1998.
  VA would be authorized to make construction grants to modify State 
homes to provide adult day care and to pay per diem to State homes for 
veterans receiving adult day care.
  VAMCs would be allowed a new window of opportunity to create research 
corporations for the purpose of accepting gifts and grants from the 
private sector for funding VA medical research. This authority would 
sunset on December 31, 2000. These corporations would be required to 
report to Congress on the sources and expenditures of their funds.
  The Office of the Under Secretary for Health be required to be 
staffed so as to ensure that the Under Secretary has the benefit of the 
expertise and policy guidance of: First, VA's specialized programs 
(e.g. blind rehabilitation, spinal cord dysfunction, mental illness, 
etc.) and, second, readjustment counseling. The amendment would also 
eliminate the current requirement that the Associate Deputy Under 
Secretary be an MD.
  In addition, the amendment would eliminate current ``moonlighting'' 
restrictions imposed on full time VA health care professionals. The 
recovery of special pay incentives would be suspended for doctors and 
dentists while they pursue additional residency training if they return 
to VA employment. VA would also be given more flexibility in payment 
arrangements for residents and interns.
  And, finally, land transfers at VAMCs Milwaukee and Cheyenne would be 
approved and the VA Medical Center at Mountain Home, TN, would be named 
after Congressman James H. Quillen. That name change would take effect 
at the beginning of the 105th Congress or when Congressman Quillen 
ceases to be a Member of Congress.
  Madam President, this amendment is a major legislative 
accomplishment. And, as we all know, such an accomplishment requires 
hard work on the part of everyone involved. We would not be where we 
are today without the active and sincere involvement and interest of 
the distinguished ranking minority member of the Committee on Veterans' 
Affairs, Senator Jay Rockefeller. In addition to recognizing his hard 
work and that of the Committee's minority staff director and chief 
counsel, Jim Gottlieb, I must acknowledge the tireless effort and broad 
expertise of Bill Brew. Bill Brew took me by the hand and ``showed me 
the ropes'' when I first came to the Committee on Veterans' Affairs as 
a junior member of the committee. Now years later, and when I am in the 
last days of my chairmanship of the committee, I find that Bill is 
still indispensable to the committee's operations. They don't make many 
like Bill, and veterans everywhere are very fortunate that he has 
chosen to put his talent to work on the committee staff.
  And then my dear friend, Sonny Montgomery. What a man. The present 
ranking minority member of the House Committee on Veterans' Affairs. 
Sometimes it seems to us all that there hasn't been a piece of 
veterans' legislation that has gone through this body since before the 
war (and I'll let you decide which war) that didn't carry the 
fingerprints of that fine and noble gentleman. He is leaving the 
legislative arena this year. But we shall all remember the unquenchable 
flame powering his singular focus on the men and women whose uniformed 
service has kept this Nation free for so long. And he has played an 
unmatched role in the development and enactment of the amendment now 
before this body. He is a very dear friend. Chairman Bob Stump of the 
House committee takes second place to no one when it comes to veterans' 
legislation and so it has been in the evolution of this bill. He is 
steady and courageous and I am proud to be his friend also. I thank him 
for his constructive role and acknowledge his indispensable efforts to 
transform the commitment of the Congress to America's veterans into 
effective and generous benefits and services.

  Madam President, I suspect that Congressmen Stump and Montgomery 
would be the first to acknowledge their debt to their dedicated staff. 
Carl Commentator, Kingston Smith and JoAnn Webb of the majority staff, 
and Pat Ryan and Ralph Ibsen of the minority staff have worked 
tirelessly to implement the policy direction of their bosses.
  And lastly, Tom Harvey, my chief counsel and staff director, and his 
crew on the Senate Veterans' Committee staff have done yeoman service 
over the last 2 years. Tom has long been the absolutely indispensable 
voice of reason to whom I have turned for advice so many times when the 
topic turned to veterans. And he has ``saved my bacon'' many a time, 
especially with the Veterans' service organizations. A more loyal, 
savvy, protective friend I

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could never have. For the last 2 years, I have slept less fitfully 
knowing he is in full charge of the committee staff. Chris Yoder, as a 
fine professional staff member, has been responsible for health care 
issues, and has shepherded this amendment from it's origin as a cluster 
of ideas on a ``to do'' list through the legislative product now before 
this body. Bill Tuerk, the committee's general counsel, has played an 
indispensable and strong role in the development of this amendment and 
has committed more time and energy to its enactment than it is 
reasonable to ask of someone unless they work for love of country as 
well as for sustenance. Their efforts were well supported by Deputy 
Staff Director Dave Balland, Dat Tran, Bill Foster, Stephanie Foster, 
Dr. Sally Satel, Dennis Doherty, Rosie Ducosin, Linda Reamy, and 
Dolores Moorehead. All very wonderful people. The Members of this body, 
as well as America's 26 million veterans, are all deeply indebted to 
all of them for their consistent hard work and commitment.
  Madam President, I urge my colleagues to join me in support of this 
legislation and I thank the Chair.
  I ask unanimous consent that a joint explanatory statement be printed 
in the Record.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

   JOINT EXPLANATORY STATEMENT FOR H.R. 3118, THE PROPOSED VETERANS' 
               HEALTH CARE ELIGIBILITY REFORM ACT OF 1996

       H.R. 3118, the proposed ``Veterans' Health Care Eligibility 
     Reform Act of 1996'' reflects a compromise agreement that the 
     Senate and House of Representatives Committees on Veterans' 
     Affairs have reached on a number of bills considered in the 
     Senate and House during the 104th Congress, including: a 
     construction authorization bill, ordered reported by the 
     Senate Committee on Veterans' Affairs on July 24, 1996, 
     [hereinafter, Senate Construction Authorization Bill]; an 
     eligibility reform bill, ordered reported by the Senate 
     Committee on Veterans' Affairs on July 24, 1996, 
     [hereinafter, Senate Eligibility Reform Bill]; and a health 
     care bill, ordered reported by the Senate Committee on 
     Veterans' Affairs on July 24, 1996, [hereinafter, Senate 
     Health Care Bill]; H.R. 1384, ordered reported on June 15, 
     1995, and passed by the House on October 10, 1995; H.R. 3376, 
     ordered reported on May 8, 1996, and passed by the House on 
     June 4, 1996; H.R. 3118, ordered reported on May 8, 1996, and 
     passed by the House on July 30, 1996; and H.R. 3643, ordered 
     reported on June 20, 1996, and passed by the House on July 
     16, 1996.
       The Committees on Veterans' Affairs have prepared the 
     following explanation of H.R. 3118 (hereinafter referred to 
     as ``compromise agreement''). Differences between the 
     provisions contained in the compromise agreement and the 
     related provisions in the bills listed above are noted in 
     this document, except for clerical corrections and conforming 
     changes made necessary by the compromise agreement, and minor 
     drafting, technical, and clarifying changes.

                      Title I--Eligibility Reform


                          ELIGIBILITY FOR CARE

     Current law
       Provisions of law governing eligibility for VA care, set 
     forth in chapter 17 of title 38 U.S. Code, are complex and 
     are not uniform across levels of care. All veterans are 
     ``eligible'' for hospital care and nursing home care, but 
     ``eligibility'' does not in itself assure access. Existing 
     law draws a broad distinction, for purposes of all levels of 
     care, between two categories. The first is a ``multi-tiered'' 
     cohort (``category A'') of veterans who have been recognized 
     through a series of acts of Congress as having a priority to 
     VA care, including service-connected veterans, those 
     considered unable to defray the expenses of necessary care, 
     and several special-eligibility subgroupings. The second 
     category, which has a lower priority for VA care, 
     encompasses all other veterans who have no special 
     eligibility and whose income exceeds means-test thresholds 
     set in law.
       With respect to hospital care, the law states that VA 
     ``shall'' provide needed care to all category A veterans, 
     while VA ``may'' provide those same veterans nursing home 
     care. Eligibility for outpatient care is more fragmented. 
     Only limited groups of veterans are eligible for 
     comprehensive outpatient care. The VA ``shall'' furnish such 
     care to those who are 50% or more service-connected, and 
     ``may'' furnish it to former prisoners of war, World War I 
     veterans, and certain profoundly disabled veterans. Current 
     law imposes specific limitations on certain other veterans. 
     Those not eligible for comprehensive services are limited 
     generally to treatment ``to obviate a need of hospital 
     admission'' or to complete treatment initiated on an 
     inpatient basis. Veterans undergoing treatment based on a 
     need to obviate hospitalization are specifically not eligible 
     to receive prosthetic supplies.
       A provision of existing law, which sunsets on December 31, 
     1996, provides special eligibility for health care services 
     for veterans exposed to toxic or hazardous substances during 
     their service.
     9House bills
       H.R. 3118: Section 2 would provide that, within 
     appropriations, VA shall provide all needed hospital care and 
     medical services (including preventive health services), and 
     may provide all needed nursing home care to veterans in 
     category A (other than veterans with a non-compensable 
     disability). VA shall ensure that a service-connected veteran 
     is provided all benefits under chapter 17 for which the 
     veteran was eligible prior to enactment of the bill. Section 
     3 would authorize VA to furnish needed prosthetic items for a 
     veteran otherwise receiving care or services under chapter 
     17; in addition, it would require VA to develop guidelines 
     applicable to provision of hearing aids and eyeglasses.
       Section 4 would establish a new section 1705 which would 
     require that VA manage provision of hospital care and medical 
     services under new section 1710 through a system of annual 
     patient enrollment. Enrollment of veterans is to be managed 
     in accordance with specified priorities in the following 
     order:
       Veterans with service-connected disabilities rated 30% or 
     higher;
       Former POW's and veterans with service-connected 
     disabilities rated 10% and 20%;
       Veterans in receipt of increased pension based on need of 
     aid and attendance or housebound status, and other veterans 
     who are catastrophically disabled (such as the spinal cord 
     injured);
       Veterans unable to defray the cost of care; and
       All other ``category A'' veterans.
       In designing an enrollment system, the Secretary would be 
     authorized to establish additional priorities within the 
     priority groupings and to provide for exceptions to the 
     specified priorities where dictated by compelling medical 
     reasons, but would be required to ensure that the system is 
     managed in a manner to ensure that the provision of care to 
     enrollees is timely and acceptable in quality.
       Section 4 would also establish a new section 1706, 
     applicable to managing the provision of hospital care and 
     medical services, which would:
       Require VA, to the extent feasible, to design, establish 
     and manage health care programs so as to promote cost-
     effective delivery of care in the most clinically appropriate 
     setting;
       Authorize VA to contract for hospital care and medical 
     services when VA facilities could not furnish such care 
     economically, and to establish such acquisition policies and 
     procedures as appropriate to provide the needed services; and
       Require VA to maintain its capacity to provide for the 
     specialized treatment and rehabilitation needs of disabled 
     veterans so as to afford those veterans reasonable access, 
     and ensure that overall capacity is not reduced below its 
     capacity to provide those services as of the date of 
     enactment of the section.
       The bill would also authorize appropriations for the 
     medical care account, for the purposes specified for that 
     account in the most recent VA/HUD appropriations act, 
     including the cost of providing care under the amendments 
     made by section 2, not to exceed $17.25 billion for fiscal 
     year 1997 and not to exceed $17.9 billion for fiscal year 
     1998.
       The bill would also include a detailed report on 
     implementation and operation applicable to sections 2, 3, and 
     4.
       H.R. 3643: Section 1 would extend special eligibility 
     provisions applicable to veterans exposed to toxic or 
     hazardous substances and, with respect to herbicide-and 
     ionizing radiation-exposed veterans, revise such eligibility, 
     as follows:
       Extend the special eligibility provision applicable to 
     service in the Persian Gulf until December 31, 1998;
       Provide with respect to herbicide-exposed veterans, that VA 
     for a two-year period shall provide care for diseases (1) for 
     which the National Academy of Sciences in a report issued in 
     accordance with section 2 of the Agent Orange Act of 1991 has 
     determined (or subsequently determines) that there is either 
     some evidence of, or insufficient evidence to permit a 
     conclusion as to, an association between occurrence of the 
     disease in humans and exposure to a herbicide agent, and (2) 
     which the Secretary, based on peer-reviewed research 
     published within a specified period after the most recent 
     Academy report, determines there is credible evidence 
     suggestive of such an association;
       Limit the treatment of veterans exposed to ionizing 
     radiation to treatment of those diseases listed in 38 USC 
     sec. 1112(c)(2) and those as to which VA determines there is 
     credible evidence of a positive association between disease 
     occurrence and radiation exposure; and
       Provide that, as to veterans who received care under the 
     special eligibility provisions being amended, such provisions 
     shall continue in effect for continued care of the disability 
     for which such care was furnished before the date of 
     enactment.
       Section 1 would also expand eligibility for health care 
     applicable to the Persian Gulf War to veterans who served in 
     Israel or Turkey during the period August 2, 1990 through 
     July 31, 1991.
     Senate health care reform bill
       Section 2 would amend section 1701 of title 38 to add 
     definitions for the terms ``health care'' and ``respite 
     care''.
       Section 3 generally conditions eligibility for health care 
     to a requirement that a veteran enroll for VA care. It would 
     provide that VA--

[[Page S11647]]

       Shall furnish health care to any veteran for a service-
     connected disability, and any veteran who is 50% or more 
     service-connected disabled, a former prisoner of war, or a 
     veteran of World War I or the Mexican border; and shall 
     furnish hospital care for the treatment of any disability of 
     a veteran with a compensable disability;
       Shall, to the extent resources and facilities are 
     available, furnish health care to all other category A 
     veterans (other than veterans with a non-compensable 
     disability); and
       May furnish health care, subject to copayment requirements, 
     to any other veteran.
       The section recodifies existing law on eligibility for 
     nursing home care and domiciliary care, but generally 
     conditions such eligibility on a requirement that a veteran 
     enroll for such care. The section would also recodify into 
     new section 1710, without substantive change, other 
     eligibility provisions of current section 1712.
       The section would exempt veterans who are 50% or more 
     service-connected disabled and veterans in need of care for a 
     service-connected condition from the requirement that a 
     veteran enroll to receive VA care, and provide that VA shall 
     automatically enroll such veterans upon application for care.
       Section 3 would extend through December 31, 1997, existing 
     law governing special eligibility for veterans exposed to 
     toxic or hazardous substances.
       Section 4 would require that VA manage provision of care 
     under new section 1710 through a system of annual patient 
     enrollment, with enrollment of veterans (who are not 
     automatically enrolled) to be managed in accordance with 
     specified priorities in the order listed, from veterans with 
     service-connected disabilities rated 50 percent or greater 
     having the highest priority and category C veterans the 
     lowest. In designing an enrollment system, the Secretary 
     would be authorized to establish additional priorities within 
     the priority groupings, and to provide for exceptions to the 
     specified priorities where dictated by compelling medical 
     reasons.
       Section 5 would make conforming and clerical amendments.
       Section 6 would authorize appropriations for the Department 
     for FY 1997 of $17,068,447,000 for the purposes of the 
     provision of VA medical care. It would authorize increases in 
     appropriations in subsequent fiscal years in the amount of 
     the consumer price index.
     Compromise agreement
       Sections 101, 103, 104, 105, and 106 are derived 
     substantially from H.R. 3118, with revisions, based primarily 
     on the Senate bill, to include the following:
       Addition of a requirement that, effective on October 1, 
     1998, VA may not provide hospital care or medical services 
     unless the veteran enrolls with VA;
       Revision in the list of priorities for enrollment to 
     provide highest priority to any veteran who has a service-
     connected disability rated 50% or greater, and second 
     priority to veterans 30% or 40% service-connected disabled:
       Deletion of proposed amendments to section 1703 of title 38 
     that would have established broad authority to contract for 
     hospital care and medical services; and
       With respect to the requirement that VA maintain its 
     special disability program capacity, inclusion of a report 
     requirement and establishment of a consultative role for 
     special VA committees in assisting the Secretary in carrying 
     out this provision.
       Section 102 would extend special eligibility provisions 
     applicable to veterans exposed to toxic or hazardous 
     substances and, with respect to herbicide- and ionizing 
     radiation-exposed veterans, revise such eligibility. With 
     respect to the special eligibility provisions associated with 
     ionizing radiation and Persian Gulf War service, the section 
     follows section 1 of H.R. 3643 (with the exception of the 
     proposed expansion to Israel and Turkey, which is not 
     contained in the compromise). The revisions applicable to 
     herbicide-exposed veterans are partially derived from H.R. 
     3643, and would:
       Extend the special eligibility provision (applicable to 
     herbicide-exposed veterans) in existing law until December 
     31, 2002, but provide that VA shall not furnish care (under 
     this special eligibility authority) for diseases for which 
     the National Academy of Sciences, in a report issued in 
     accordance with section 2 of the Agent Orange Act of 1991, 
     has determined that there is evidence that is (at least) 
     suggestive of the lack of a positive association between 
     occurrence of the disease in humans and exposure to a 
     herbicide agent; and
       Provide that, as to veterans who received care under the 
     special eligibility provisions being amended (for herbicides 
     and ionizing radiation), such provisions shall remain in 
     effect for continued care of the disability for which 
     treatment was furnished before the date of enactment.

                  Title II--Construction Authorization


            AUTHORIZATION OF MAJOR MEDICAL FACILITY PROJECTS

     Current law
       Section 8104(a)(2) of title 38 provides that no funds may 
     be appropriated for any fiscal year, and the Secretary of 
     Veterans Affairs may not obligate or expend funds (other than 
     for advance planning and design), for any major medical 
     facility project unless funds for that project have been 
     specifically authorized by law.
     House Bill
       Section 101(a) of H.R. 3376 would authorize the Secretary 
     to carry out the following ambulatory care projects: Dallas, 
     TX, $19.9 million; Brockton, MA, $13.5 million; Shreveport, 
     LA, $25 million; Lyons, NJ, $21.1 million; Tomah, WI, $12.7 
     million; Asheville, NC, $28.8 million; Temple, TX, $9.8 
     million; and Tucson, AZ, $35.5 million.
       Section 101(b) of H.R. 3376 would authorize the Secretary 
     to carry out the following environmental improvement 
     projects: Lebanon, PA, $9.5 million; Marion, IL, $11.5 
     million; Atlanta, GA, $28.2 million; Battle Creek, MI, $22.9 
     million; Omaha, NE, $7.7 million; Pittsburgh, PA, $17.4 
     million; Waco, TX, $26 million; Marion, IN, $17.3 million; 
     Perry Point, MD, $15.1 million; and Salisbury, NC, $18.2 
     million.
       Section 101(c) would authorize the Secretary to carry out 
     the following seismic correction projects: Palo Alto, CA, $36 
     million; Long Beach, CA, $20.2 million; and San Francisco, 
     CA, $26 million.
     Senate construction authorization bill
       Section 101 would authorize the Secretary to carry out 
     identical ambulatory care projects except for the following: 
     Projects not authorized: Dallas, TX; Lyons, NJ; and Tucson, 
     AZ. Projects authorized at modified amounts: Shreveport, LA, 
     $25.4 million; Asheville, NC, $28.5 million; and Temple, TX, 
     $9.5 million. Additional projects authorized in the Senate 
     Amendment: Honolulu, HI, $43 million; Wilkes Barre, PA, $42.7 
     million; and Leavenworth, KS; $27.75 million.
       Section 101 would also authorize the Secretary to carry out 
     identical environmental improvement projects except for the 
     following: Atlanta, GA; Battle Creek, MI; and Waco, TX, which 
     are not authorized.
       The bill would not authorize the Secretary to carry out any 
     seismic correction projects.
     Compromise Agreement
       The projects authorized in the Compromise Agreement are 
     derived from both measures. The Senate agrees to the addition 
     of projects at Waco, TX; Lyons, NJ; Tucson, AZ; and scaled-
     down seismic work at Palo Alto, CA. The House agrees to the 
     addition of ambulatory care projects at Honolulu, HI and 
     Leavenworth, KS. It also contains a modified authorization of 
     $26.3 million for Asheville, NC, and the House recedes from 
     its proposed inclusion of projects at Dallas, TX; Atlanta, 
     GA; Battle Creek, MI; Long Beach, CA; and San Francisco, 
     CA.


             AUTHORIZATION OF MAJOR MEDICAL FACILITY LEASES

     Current Law
       Section 8104(a)(2) of title 38 provides that no funds may 
     be appropriated for any fiscal year, and the Secretary of 
     Veterans Affairs may not obligate or expend funds (other than 
     for advance planning and design), for any major medical 
     facility lease unless funds for that lease have been 
     specifically authorized by law.
     House bill
       Section 102 of H.R. 3376 would authorize the Secretary to 
     carry out the following leases of satellite outpatient 
     clinics: Allentown, PA, $2.159 million; Beaumont, TX, $1.94 
     million; Boston, MA, $2.358 million; and Toledo, OH, $2.223 
     million.
       Section 102 of H.R. 3376 would authorize the Secretary to 
     carry out a lease of a parking facility in Cleveland, OH, for 
     $1.3 million.
       Section 102 of H.R. 3376 would authorize the Secretary to 
     carry out a lease of a satellite outpatient clinic and a VBA 
     field office in San Antonio, TX, for $2.256 million. Senate 
     Construction Authorization Bill
       Section 102 contains the same lease authorizations as the 
     House bill, and would also authorize the lease of an 
     outpatient facility in Ft. Myers, FL.
     Compromise agreement
       Section 202 follows the House Bill.


                    AUTHORIZATION OF APPROPRIATIONS

     Current law
       Section 8104(a)(2) of title 38 provides that no funds may 
     be appropriated for any fiscal year, and the Secretary of 
     Veterans Affairs may not obligate or expend funds (other than 
     for advance planning and design), for any major medical 
     facility project or major medical facility lease, unless 
     funds for that project or lease have been specifically 
     authorized by law.
     House bill
       Section 103(a) of H.R. 3376 would authorize to be 
     appropriated to the Secretary of Veterans Affairs for fiscal 
     year 1997 (1) $422.3 million for the authorized major medical 
     facility projects; and (2) $12.236 million for the authorized 
     major medical facility leases.
       Section 103(b) of H.R. 3376 would limit the authorized 
     projects to be carried out using only (1) specifically 
     authorized major construction funds appropriated for fiscal 
     year 1997; (2) funds appropriated for Construction, Major 
     Projects, for a fiscal year before fiscal year 1997 that 
     remain available for obligation; and (3) funds appropriated 
     for Construction, Major Projects, for fiscal year 1997 for a 
     category of activity not specific to a project.
     Senate construction authorization bill
       Section 103(a) would authorize to be appropriated to the 
     Secretary of Veterans Affairs for fiscal year 1997 (1) 
     $299.75 million for the authorized major medical facility 
     projects; and (2) $13.972 million for the authorized major 
     medical facility leases.

[[Page S11648]]

       Section 103(b) is substantively identical to the House 
     provision in section 103(b).
     Compromise agreement
       Section 203(a) authorizes to be appropriated to the 
     Secretary of Veterans Affairs for fiscal year 1997 and fiscal 
     year 1998 (1) $358.15 million for the authorized major 
     medical facility projects; and (2) $12.236 million for the 
     authorized major medical facility leases.
       Section 203(b) follows the House and Senate provisions 
     except that it provides that projects in section 201 are 
     authorized for funding in fiscal years 1997 and 1998.


                           STRATEGIC PLANNING

     Current law
       Section 8107(a) of title 38 requires the Secretary to 
     submit to the Senate and House Committees on Veterans' 
     Affairs an annual report detailing VA's five-year medical 
     facility construction plans, to include a list of the VA's 
     highest priority hospital construction projects.
     House bill
       Section 201 would repeal the report requirement in section 
     8107(a) and require a broader annual report on long-range 
     health planning. The new annual report would be required to 
     include (a) a strategic plan for provision of care (including 
     provision of services for the specialized treatment and 
     rehabilitative needs of disabled veterans) through networks 
     of VA medical facilities operating within prescribed 
     geographic service delivery areas; (b) a description of how 
     such networks will coordinate their planning efforts; and (c) 
     a profile of each network.
       The network profile would be intended to identify (a) the 
     mission of each medical facility, or proposed facility; (b) 
     any planned change in any facility's mission and the 
     rationale for the change; (c) data regarding the population 
     of veterans served by the network and anticipated changes 
     both in demographics and in health-care needs; (d) pertinent 
     data by which to assess the progress made toward achieving 
     relative equivalency in the availability of services per 
     patient in each network; (e) opportunities for providing 
     veterans services through contract arrangements; and (f) 
     five-year construction plans for facilities in each network.
       The report would also be required to include information 
     with respect to each VA medical care facility regarding 
     progress toward instituting identified, planned mission 
     changes; implementing managed care; and establishing new 
     services to provide veterans alternatives to institutional 
     care.
       The report would also be required to include (a) the 20 
     most highly ranked major medical construction projects (by 
     category of project) and the relative rank and priority score 
     for each; (b) a description of the specific factors that 
     account for the project's ranking in relation to other 
     projects within the same category; and (c) a description of 
     the reasons for any change in the ranking from the last 
     report.
     Senate construction authorization bill
       The Senate Bill contains no comparable provision.
     Compromise agreement
       Section 204 follows the House Bill.


                  REVISION TO PROSPECTUS REQUIREMENTS

     Current law
       Section 8104(b) of title 38 requires the Secretary to 
     submit to the Senate and House Committees on Veterans' 
     Affairs a prospectus for any medical facility proposed by the 
     President or the Secretary. The prospectus is required to 
     include a detailed description and a cost estimate of the 
     proposed medical facility.
     House bill
       Section 202 of H.R. 3376 would expand the requirements of 
     each prospectus under section 8104(b) to include (a) 
     demographic data applicable to the project; (b) current and 
     projected workload and utilization data; (c) current and 
     projected operating costs of the facility; (d) the priority 
     score assigned to the project under VA's prioritization 
     methodology (and if a project is proposed for funding ahead 
     of a higher-scored project, an explanation of the factors 
     underlying that funding decision); and (e) a listing of each 
     alternative to construction of the facility that has been 
     considered.
     Senate bill
       No comparable provision.
     Compromise agreement
       Section 205 follows the House bill.


                CONSTRUCTION AUTHORIZATION REQUIREMENTS

     Current law
       Under section 8104(a)(3)(A) of title 38, the term ``major 
     medical facility project'' means a project for the 
     construction, alteration or acquisition of a medical facility 
     involving a total expenditure of more than $3 million, but 
     such term does not include an acquisition by exchange.
       Under section 301(b) of the Veterans' Medical Programs 
     Amendments of 1992, Public Law 102-405, major medical 
     construction projects for which funds were appropriated prior 
     to Public Law 102-405 are exempted from the requirement of 
     congressional authorization.
       There is no provision in current law expressly requiring 
     the Secretary to report to the Senate and House Committees on 
     Veterans' Affairs prior to obligating funds from the Advance 
     Planning Fund (APF) or toward design or development of a 
     major medical facility project.
     House bill
       Section 203(a) would increase the funding threshold for 
     major medical facility projects from $3 million to $5 
     million.
       Section 203(b) would provide that, effective as to fiscal 
     year 1998, the ``grandfather clause'' in section 301(b) of 
     Public Law 102-405 shall have no application.
       Section 203(c) would require the Secretary to report in 
     advance on plans to obligate APF funds in excess of $500,000 
     on any project.
     Senate construction authorization bill
       The Senate bill contains no comparable provisions.
     Compromise agreement
       Section 206(a) increases the funding threshold for major 
     medical facility projects from $3 million to $4 million.
       Section 206(b) follows the House bill.
       Section 206(c) follows the House bill.


                          TERMINOLOGY CHANGES

     Compromise agreement
       Section 207 would make technical changes in terminology in 
     sections 8101 and 8109 of title 38 regarding elements of the 
     construction process.

               Title III--Health Care and Administration

           Subtitle A--Health Care Sharing and Administration


   REVISION OF AUTHORITY TO SHARE MEDICAL FACILITIES, EQUIPMENT AND 
                              INFORMATION

     Current law
       Subchapter IV of chapter 81 of title 38 authorizes VA to 
     enter into agreements with specified health care entities for 
     the mutual use or exchange of use of ``specialized medical 
     resources,'' a narrowly defined term. VA is only authorized 
     to enter into ``sharing agreements'' involving specialized 
     medical resources with health care facilities, research 
     centers or medical schools. VA has broader authority under 
     section 8153 to ``share'' any health care resource only 
     with State veterans homes.
     House bill
       Section 6 of H.R. 3118 would (a) expand both the range of 
     health care resources which can be the subject of mutual use 
     or exchange of use contracts, and the kind of entities with 
     which VA may so contract; (b) provide that VA may execute 
     such contracts involving any health care resource, and may 
     contract with any individual or entity, including a health 
     plan; (c) provide greater flexibility as to when a VA 
     facility may enter into such a contract, and what payment 
     requirements it may negotiate in selling services, while 
     conditioning the circumstances under which VA furnishes 
     services to non-veterans [only when such an arrangement (1) 
     would not result in delay or denying veterans' care and (2) 
     would result in improving the care of veterans, or is 
     necessary to maintain an acceptable level or quality of 
     service at that facility]; and (d) clarify that VA is to be 
     reimbursed when it provides services under a ``sharing 
     agreement'' to a Medicare-covered patient.
     Senate health care bill
       Section 101 of S. 1359 contains provisions substantively 
     similar to the provisions described in (a) and (b) of the 
     House bill.
       The Senate bill contains no provisions pertaining to the 
     provisions described in (c) and (d) of the House bill
     Compromise agreement
       Section 301 is derived from provisions of both the House 
     and Senate bills. As provided for under the Senate bill, the 
     section would revise the statement of purpose in 38 USC sec. 
     8151 to reflect a broader sharing mandate, and revise the 
     definitional provisions applicable to the broader scope of 
     the new authority. Amendments to section 8153 are primarily 
     derived from the House bill and are intended to encourage 
     increased efficiencies, applicable to sharing hospital care 
     and medical services (as those terms are defined in chapter 
     17 of title 38), supplies, and any other health-care service, 
     support, or administrative resource. The measure is subject 
     to the limitation that VA may furnish services to non-
     veterans under this section only if veterans will receive 
     priority under such an arrangement and that arrangement 
     either is needed to maintain an acceptable level and quality 
     of service or will result in improved services to eligible 
     veterans. Section 301 would also provide that in instances 
     where the health-care resource is a commercial service, the 
     use of medical equipment or space, or research, and is to be 
     acquired from an institution affiliated with the VA, 
     including medical practice groups, blood banks, organ banks 
     or research centers, the acquisition may be accomplished 
     on a sole source basis. Where the health care resource is 
     to be obtained from other commercial sources, it would be 
     obtained in accordance with simplified procurement 
     procedures developed by the Secretary that would permit 
     all responsible sources to compete for the resources being 
     obtained.


         improved efficiency in health care resource management

     Current law
       Title II of Public Law 102-585 authorized an expansion of 
     the cooperative arrangements between VA and DoD facilities 
     instituted

[[Page S11649]]

     under Public Law 97-174. Public Law 102-585 authorized the 
     Departments to enter into agreements under which VA 
     facilities could provide medical services to beneficiaries of 
     DoD's CHAMPUS program. Under this authority, VA has begun to 
     provide care to dependents of active-duty members and 
     retirees. Section 204 of Public Law 102-585 ``sunsets'' this 
     expanded authority on September 30, 1996.
     House bill
       Section 5 of H.R. 3118 would repeal section 204 of Public 
     Law 102-585 and extend indefinitely VA's authority to provide 
     care and services through contract arrangements to DoD 
     beneficiaries under chapter 55 of title 10, United States 
     Code. Section 5 would also clarify VA's authority to recover 
     or collect from the insurance plans (including so-called 
     ``CHAMPUS supplemental'' plans) of CHAMPUS beneficiaries 
     cared for by VA to the same extent as DoD recovers for care 
     rendered to these beneficiaries in its facilities. This 
     section would also direct that all funds received by VA from 
     insurance plans of CHAMPUS beneficiaries be credited to the 
     VA facility that furnished the care.
     Senate health care bill
       Section 212 of S. 1359 would extend for two years, from 
     October 1, 1996 to December 31, 1998, VA's authority to 
     provide care and service through contract arrangements to DoD 
     beneficiaries.
       The Senate Amendment contains no comparable provision 
     relating to VA's authority to recover from insurance plans of 
     CHAMPUS beneficiaries or to VA's authority to credit the VA 
     facility that furnished such care.
     Compromise agreement
       Section 302 follows the House bill. It also provides that 
     any services provided under agreements entered into under 
     section 201 of Public Law 102-585 during the period beginning 
     on October 1, 1996, and ending on the date of enactment of 
     the Act are ratified.


                 personnel furnishing shared resources

     Current law
       Section 712 of title 38 established a requirement for 
     minimum numbers of employees in the Department of Veterans 
     Affairs. As implemented, however, this provision has resulted 
     in the establishment of employment ceilings. Such ceilings 
     potentially create a dilemma with respect to medical facility 
     staffing in that they may force a choice between dedicating 
     staff solely to internal service delivery, regardless of the 
     level of efficiency of such service, or to providing as well 
     some level of service delivery to other entities under the 
     auspices of efficiency-driven ``sharing agreements''. Faced 
     with such a choice, facility directors might opt not to 
     embark on any new ``sharing agreements'' or may question the 
     merits of maintaining those in place.
     House bill
       Section 7 of H.R. 3118 would provide that for purposes of 
     determining the minimum number of positions to be maintained 
     at VA during a fiscal year, the number of positions at VA in 
     any fiscal year (to be reduced under existing law by 
     reference to specified categories of positions) would be 
     further reduced by the number of positions in that fiscal 
     year held by persons involved in providing health care 
     resources under ``sharing agreements'' executed under section 
     8111 of title 38 (as expanded by section 201 of Public Law 
     102-585) or section 8153 of title 38.
     Senate health care bill
       The Senate bill contains no comparable provision.
     Compromise agreement
       The Compromise Agreement follows the House Bill.


           waiting period for administrative reorganizations

     Current law
       Section 510 of title 38 authorizes the Secretary to 
     reorganize the functions of the Administrations, offices, 
     facilities or activities in VA. Prior to implementing such a 
     reorganization, the Secretary must submit to the House and 
     Senate Committees on Veterans' Affairs a report containing a 
     detailed plan and justification for the change. The 
     reorganization may not be started until 90 days after the 
     Congressional committees have received the Secretary's 
     report.
     House bill
       The House bill contains no provision relating to this 
     matter.
     Senate health care bill
       Section 102 would change the waiting period from 90 days to 
     45 days, thirty days of which Congress shall have been in 
     continuous session.
     Compromise agreement
       Section 304 follows the Senate Health Care Bill.


    repeal of limitations on contracting outpatient care activities

     Current law
       Section 8110(c) of title 38 prohibits contracting out of 
     direct patient care activities or activities ``incident to'' 
     direct care, and permits contracting out other activities at 
     VA health-care facilities only on the basis of a VA-conducted 
     cost-comparison study carried out in accordance with the 
     provisions of that subsection. Under section 1103 of Public 
     Law 103-446, the provisions of section 8110(c) have no effect 
     through fiscal year 1999.
     House bill
       The House bill contains no provision relating to this 
     matter.
     Senate health care bill
       Section 103 would repeal section 8110(c).
     Compromise agreement
       Section 305 incorporates the Senate provisions and adds an 
     annual reporting requirement.

                   Subtitle B--Care of Women Veterans


                     mammography quality standards

     Current law
       Section 354 of the Public Health Service Act, as added by 
     Public Law 102-539, relates to the certification by the 
     Secretary of Health and Human Services of facilities which 
     perform mammograms. This section does not apply to VA health 
     care facilities.
     House bill
       Section 8 of H.R. 3643 would add a new section 7319 to 
     title 38 which would (a) require VA facilities to be 
     accredited by a private nonprofit organization to perform 
     mammography testing; (b) require VA to prescribe quality 
     assurance standards for the performance and interpretation of 
     mammograms and the use of mammography equipment by 
     facilities, that these standards be prescribed by the 
     Secretary of Veterans Affairs in consultation with the 
     Secretary of Health and Human Services, and that they are to 
     be as stringent as those prescribed under the Public Health 
     Services Act; (c) provide for annual inspection of equipment 
     and facilities used by and in Department health care 
     facilities for the performance of mammograms; (d) require 
     that any outside facility performing mammography services for 
     VA under contract must meet the requirements issued by the 
     Secretary of Health and Human Services. Section 8 would also 
     require the Secretary of Veterans Affairs to prescribe 
     standards under section 7319(b) not later than 120 days after 
     enactment. It would also require an implementation report to 
     be submitted to the House and Senate Committees on Veterans' 
     Affairs within 120 days after the Secretary prescribes 
     quality standards or the date of enactment, whichever comes 
     later.
     Senate health care bill
       Title V contains substantially similar provisions.
     Compromise agreement
       Section 321 contains this provision.


                   patient privacy for women patients

     Current law
       There is no express provision in current law relating to 
     patient privacy issues for women patients.
     House bill
       Section 9 of H.R. 3643 would require VA to (a) survey each 
     of its medical centers to identify deficiencies relating to 
     the personal privacy of women patients; (b) ensure that plans 
     to correct deficiencies identified in the survey are 
     developed and incorporated into VA's construction planning 
     processes and given high priority; (c) compile an annual 
     inventory of those deficiencies and remedial plans; and (d) 
     report to Congress annually through 1999 on such deficiencies 
     and include the inventory compiled by the Secretary, the 
     proposed corrective plans and the status of such plans in the 
     report.
     Senate health care bill
       The Senate bill contains no comparable provisions.
     Compromise agreement
       Section 322 generally follows the House Bill. The 
     Compromise Agreement limits the construction requirement to 
     projects where it is cost efficient to do so.


       assessment of use by women veterans of va health services

     Current law
       Section 318 of title 38 provides for a Center for Women 
     Veterans at VA. The Center's director serves as the principal 
     adviser to the Secretary on the adoption and implementation 
     of policies and programs affecting women veterans. The 
     Secretary includes in documents submitted to Congress in 
     support of the President's budget for each fiscal year the 
     following: (1) detailed information on the budget for the 
     Center; (2) the Secretary's opinion as to whether the 
     resources proposed in the budget are adequate for the Center; 
     and (3) a report on the activities of the Center for the 
     preceding fiscal year.
     House bill
       Section 7 of H.R. 3643 would (a) require the Center for 
     Women Veterans, in consultation with the Advisory Committee 
     on Women Veterans, to assess the use by women veterans of VA 
     health services, including counseling for sexual trauma and 
     mental health services; (b) require the Center to submit to 
     the Under Secretary for Health a report by April 1, 1997, 
     1998 and 1999 on the extent to which women veterans eligible 
     for VA health care fail to seek or face barriers in seeking 
     health services at VA and recommendations for encouraging 
     greater use of such services; (c) require the Secretary to 
     submit a report to the House and Senate Committees on 
     Veterans' Affairs by July 1, 1997, 1998, and 1999 containing 
     the most recent report of the Center, the views of the Under 
     Secretary for Health on the Center's report findings and 
     recommendations, and a description of the steps being taken 
     by the Secretary to remedy any problems described in the 
     report.
     Senate health care bill
       The Senate bill contains no comparable provision.
     Compromise agreement
       Section 323 follows the House bill.

[[Page S11650]]

                         REPORTING REQUIREMENTS

     Current law
       Section 107 of Public Law 102-585, which expired in 1995, 
     required the Secretary to submit annual reports on the 
     provision of health care services and the conduct of research 
     relating to women veterans carried out by, or under the 
     jurisdiction of, the Secretary to the Committees on Veterans' 
     Affairs.
     House bill
       Section 6 of H.R. 3643 would (a) extend through January 1, 
     1998, the annual reporting requirements of section 107 of 
     Public Law 102-585; and (b) add to the reporting requirements 
     information on the number of inpatient stays and outpatient 
     visits by women veterans and a description of the Secretary's 
     action to foster and encourage research on women veterans.
     Senate health care bill
       The Senate bill contains no similar provision.
     Compromise agreement
       Section 324 follows the House bill.

       Subtitle C--Readjustment Counseling and Mental Health Care


            ELIGIBILITY FOR READJUSTMENT COUNSELING SERVICES

     Current law
       Section 1712A requires VA to provide, at the request of any 
     eligible veteran, counseling to assist such veteran in 
     readjusting to civilian life. Under current law, eligible 
     veterans include Vietnam-era veterans and in-theater veterans 
     of post-Vietnam hostilities, such as Lebanon, Grenada, Panama 
     and the Persian Gulf.
     House bill
       The House bill contains no provision relating to this 
     matter.
     Senate health care bill
       Section 202 would make the following changes in current 
     eligibility for readjustment counseling: it would require VA 
     to furnish such counseling to in-theater Vietnam-era 
     veterans; in-theater combat veterans for periods prior to the 
     Vietnam era; and Vietnam-era veterans who seek such 
     counseling before January 1, 2000, or who have been furnished 
     such counseling before that date. It would also authorize VA 
     to furnish such counseling to any other veteran. The measure 
     would require the Secretary to provide bereavement counseling 
     to the surviving parents, spouse and children of certain 
     veterans and grant the Secretary the discretion to provide 
     bereavement counseling to the surviving parents, spouse and 
     children of other certain veterans; and (d) authorize the 
     Secretary to contract for bereavement counseling under this 
     section in the same manner in which it contracts for medical 
     services for veterans with total service-connected 
     disabilities under sections 1712(a)(1)(B) and 1703(a)(2).
     Compromise agreement
       Section 331 is derived from the Senate Health Care Bill. It 
     modifies existing law as follows: it requires VA to furnish 
     such counseling to in-theater Vietnam-era veterans and 
     Vietnam-era veterans who seek such counseling before January 
     1, 2000, or who have been furnished such counseling before 
     that date. It also authorizes VA to furnish such 
     counseling to any veteran who had served in a theater of 
     combat operations prior to the Vietnam-era. Section 331 
     does not contain any provision relating to the provision 
     of, or contracting for, bereavement counseling.


                    reports relating to vet centers

     Current law
       Current law contains no specific authorization for VA to 
     provide medical services at Vet Centers.
     House bill
       The House bill contains no provision relating to this 
     matter.
     Senate health care bill
       Section 204 would require the Secretary to submit to the 
     Senate and House Committees on Veterans' Affairs a report, 
     not later than six months after enactment, on the feasibility 
     and desirability of collocating Vet Centers and VA outpatient 
     clinics as current leases for such centers and clinics 
     expire. Section 205 would require the Secretary to submit to 
     the Senate and House Committees on Veterans' Affairs a 
     report, not later than six months after enactment, on the 
     feasibility and desirability of providing a limited battery 
     of health care services, including ambulatory services and 
     health care screening services, to veterans at VA 
     readjustment counseling centers.
     Compromise agreement
       Section 332 incorporates the two report provisions of the 
     Senate Amendment and adds language stating that nothing in 
     the section is intended to preclude the Secretary from 
     providing limited health care services at Vet Centers during 
     the period before submission of the reports.


           advisory committee on the readjustment of veterans

     Current law
       There is no statutory requirement for VA to establish an 
     Advisory Committee on the Readjustment of Veterans.
     House bill
       The House bill contains no provision relating to this 
     matter.
     Senate health care bill
       Section 203 would (a) add a new section 545 to title 38, 
     which would establish in VA the Advisory Committee on the 
     Readjustment of Veterans, consisting of 18 members to be 
     appointed by the Secretary; (b) provide that a term of 
     service on the Committee may not exceed 2 years and that the 
     Secretary may reappoint any member for additional terms of 
     service; (c) require the Committee to submit a report to the 
     Secretary, which shall be submitted to Congress, on the 
     programs and activities of VA that relate to the readjustment 
     of veterans to civilian life; and (d) provide that the 
     original members of the Committee shall be the members of the 
     present, administratively established Advisory Committee on 
     the Readjustment of Vietnam and Other War Veterans.
     Compromise agreement
       Section 333 follows the Senate bill.


 centers for mental illness research, education and clinical activities

     Current law
       There is no provision in current law relating to the 
     establishment of centers for mental illness research, 
     education and clinical activities.
     House bill
       Section 3 of H.R. 3643 would add a new section 7320 to 
     title 38, which would (a) require the Secretary to designate 
     not more than five VA centers of excellence in mental illness 
     research, education and clinical care activities (MIRECCs); 
     (b) require centers to be established and operated 
     collaboratively (through a formal governance structure) by a 
     VA facility (or facilities) with a mission centered on care 
     of the mentally ill and a VA facility in the same geographic 
     area with a mission of providing tertiary medical care; (c) 
     require that no less than 50 percent of the funds for the 
     center for care, research and education shall be provided to 
     the collaborating facility or facilities with a mission 
     centered on care of the mentally ill; (d) require one of the 
     participating facilities to be affiliated with a medical or 
     other school which provides mental illness training, 
     attracts clinicians and investigators with a clear and 
     focused clinical mental health research mission and 
     maintains an advisory committee; (e) require, as a 
     prerequisite to selection of any MIRECC ``center'' that a 
     peer review panel has determined that any such proposed 
     center meets the highest competitive standards of 
     scientific and clinical merit; and (f) require that at 
     least three of the five centers emphasize the development 
     of community-based alternatives to institutional treatment 
     of mental illness.
       The purpose of the MIRECCs would be to facilitate the 
     improvement of health care services for veterans suffering 
     from mental illness--especially from conditions which are 
     service-related--and to develop improved models for the 
     furnishing of clinical services. The centers would do this 
     through research, education and training of health personnel 
     and development of improved models of clinical services. The 
     aim is to channel the interests and expertise of VA tertiary 
     medicine to work toward improving mental health care at VA's 
     often unaffiliated psychiatric hospitals and developing 
     improved models of mental health care delivery. Such 
     collaboration in the case of proposed MIRECCs would entail 
     establishing a dual-sited (or even multi-sited) ``center'' 
     which involves the two (or more) VA institutions forming a 
     collaborative program encompassing mental health research, 
     education and clinical care.
       Section 3 would authorize appropriations for centers 
     through 2001, and require annual reports to the Senate and 
     House Committees on Veterans' Affairs not later than February 
     1, 1998, 1999, and 2000. Section 3 would also require the 
     Secretary to designate at least one center not later than 
     January 1, 1998.
     Senate health care bill
       Section 301 contains a similar provision, differing 
     primarily in that it imposes no requirement for collaborative 
     operation and establishment of a MIRECC by two or more VA 
     facilities. It would authorize appropriations for centers 
     through 2000, require designation of at least one MIRECC by 
     January 1, 1997, and require annual reporting until 1999.
     Compromise agreement
       Section 334 generally follows the House bill.


    committee on care of severely chronically mentally ill veterans

     Current law
       There is no provision in current law relating to the 
     establishment of an Advisory Committee on Severely 
     Chronically Mentally Ill Veterans.
     House bill
       Section 2 of H.R. 3643 would (a) require VA to establish a 
     Committee on Care of Severely Chronically Mentally Ill 
     Veterans to assess VA's capability to meet the treatment 
     needs of veterans, including women veterans, with severe and 
     chronic mental illness; (b) require that Committee members be 
     VA employees with expertise in the care of the chronically 
     mentally ill; (c) require the Committee to advise and make 
     recommendations to the Under Secretary for Health regarding 
     policies for the care of chronically mentally ill veterans; 
     and (d) require the Secretary to submit to the Senate and 
     House Committees on Veterans' Affairs annual reports on the

[[Page S11651]]

     recommendations of the committee on VA's need for improving 
     care for the chronically mentally ill. The first report would 
     be due not later than April 1, 1997, and subsequent annual 
     reports would be due not later than February 1, 1998, 1999, 
     2000, and 2001.
     Senate health care bill
       Section 214 would require the Secretary, not later than 60 
     days after receipt, to submit to the Senate and House 
     Committees on Veterans' Affairs any report submitted to the 
     Under Secretary for Health by the Special Committee for the 
     Seriously Mentally Ill Veteran as in existence on July 1, 
     1996.
     Compromise agreement
       Section 335 follows the House bill.


                           hospice care study

     Current law
       Current law provides no express authority relating to VA's 
     provision of hospice care to terminally ill veterans. 
     However, many VAMCs currently provide hospice or palliative 
     care in some form, including: (a) on-site hospice care 
     consultation teams; (b) caregiver counseling; (c) the 
     provision of pain management and other services to terminally 
     ill veterans; and (d) inpatient hospice care units, 
     freestanding buildings or separate units where a home like 
     atmosphere is created.
     House Bill
       The House bill contains no provision relating to this 
     matter.
     Senate health care bill
       Title IV of S. 1359 would add a new subchapter VII to 
     chapter 17 of title 38, ``Hospice Care Pilot Program; Hospice 
     Care Services''. Title IV would require VA to conduct a five-
     year pilot program from October 1, 1996, to December 31, 
     2001, to assess the desirability of furnishing hospice care 
     services and to evaluate the best way to provide hospice 
     care.
       VA would be required to set up demonstration projects at 15 
     to 30 VA sites (selected in a manner that provides a broad 
     spectrum of experience with regard to facility size, location 
     and range of affiliations) at which terminally ill veterans 
     receive care by (a) a hospice operated by a VAMC; (b) a non-
     VA hospice under contract with a VAMC pursuant to which any 
     necessary inpatient care would be furnished at VA facilities; 
     or (c) a non-VA hospice under contract with a VAMC with any 
     necessary inpatient care to be furnished at non-VA 
     facilities. As to each such program model, VA is to furnish 
     care under the pilot in at least five VAMCs.
       The bill would require that in contracting for hospice 
     care, VA would follow the Medicare policy in setting 
     reimbursement rates. Contract hospice rates would generally 
     be capped at the Medicare rates. However, exceptions could be 
     made in cases in which the Secretary determines that the 
     Medicare rate would not compensate a non-VA hospice for 
     providing a veteran with necessary care. The intended effect 
     of this provision would be to ensure that veterans for whom 
     care is extraordinarily expensive due to the nature of their 
     condition would not be excluded from the program.
       VA would also be required to include at least 10 VAMCs that 
     offer palliative care to terminally ill veterans. As part of 
     the evaluation, the comparison group would be intended to 
     help the Committee determine whether furnishing a less 
     comprehensive range of services constitutes a viable 
     alternative to VAMCs in which the numbers of veterans 
     desiring such services may not be sufficient to justify a 
     full-scale hospice program.
       Not later than August 1, 2000, VA would be required to 
     submit to the Senate and House Committees on Veterans' 
     Affairs a detailed report containing an evaluation and 
     assessment by the Under Secretary for Health of the hospice 
     care pilot program and the furnishing of hospice care 
     services.
       In order to ensure that VA patient care is not compromised 
     by this pilot program, the bill would expressly provide that 
     VA would not be precluded from furnishing hospice care 
     services at VAMCs not participating in the pilot program or 
     the comparison group.
       The bill would authorize appropriations of $1.2 million for 
     fiscal year 1997, $2.5 million for fiscal year 1998, $2.2 
     million for fiscal year 1999 and $100,000 for fiscal year 
     2000.
     Compromise agreement
       Section 341 would (a) require the Secretary to conduct a 
     research and evaluation study to determine the desirability 
     of furnishing hospice care to terminally ill veterans at VA 
     facilities and to evaluate the most cost effective and 
     efficient way to do so; (b) require the Secretary to conduct 
     the study using VA resources and personnel; and (c) require 
     the Secretary to submit to the Senate and House Veterans' 
     Affairs Committees a report on the research study not later 
     than April 1, 1998. The Committees intend that such study 
     would be conducted by the Management Decision and Research 
     Center of the Health Services Research and Development 
     Service.


 payment to states of per diem for veterans receiving adult day health 
                                  care

     Current law
       There is no authority in current law for VA to make per 
     diem payments to State Veterans Homes in connection with the 
     furnishing of adult day health care. There is no authority in 
     current law relating to VA's program of assistance to States 
     in connection with the construction of facilities to furnish 
     care to veterans to provide assistance in connection with the 
     construction of facilities to furnish adult day health care.
     House bill
       The House bill contains no provision relating to this 
     matter.
     Senate health care bill
       Section 211 would (a) amend section 1741 to authorize VA to 
     provide per diem payments to State Veterans Homes, at a rate 
     set by VA, for adult day health care; and (b) amend 
     subchapter III of chapter 81 to authorize construction grant 
     support to States for expansion, remodeling or alteration of 
     existing buildings to permit the provision of adult day 
     health care.
     Compromise agreement
       Section 342 follows the Senate Health Care Bill.


                          research corporation

     Current law
       Subchapter IV of chapter 73 previously authorized VA to 
     establish nonprofit corporations at individual VA medical 
     centers in order to facilitate and foster the conduct of VA 
     medical research. The establishment of such corporations was 
     intended to create mechanisms which could accept public and 
     private grants and administer funds for support of VA-
     approved research. These corporations have served as flexible 
     mechanisms to enable VA clinicians to carry out research 
     projects for which funding might not be available through 
     VA's own research appropriation. The more than 80 
     corporations are self sustaining and require no 
     appropriation. VA's authority to establish additional 
     research corporations expired in 1992. Consequently, a 
     significant number of VA facilities, including several major 
     VA medical centers, do not have a research corporation to 
     support their research programs.
     House bill
       Section 304 of H.R. 3376 would renew VA's authority to 
     establish additional research corporations and extend that 
     authority until December 31, 2000.
     Senate health care bill
       Section 302 contains a substantially similar provision. It 
     would also make a technical change in citations to the tax 
     code to clarify that research corporations shall be tax-
     exempt entities without regard to the specific provision of 
     the code under which they achieve that status. It would also 
     expand the annual reporting requirements applicable to the 
     corporations to require the Secretary to report to the 
     Committees with respect to each corporation on amounts 
     received from governmental entities, tax-exempt entities, and 
     all other sources; information on the source of contributions 
     in the case of amounts greater than $25,000 received from 
     entities other than governmental or tax-exempt sources; and 
     with respect to expenditures, amounts expended for salary for 
     research and support staff, for direct support of research, 
     and with respect to expenditures exceeding $10,000, 
     information that identifies the recipient of such payment.
     Compromise agreement
       Section 343 is generally derived from the Senate bill. It 
     would renew VA's authority to establish additional research 
     corporations and extend that authority through December 31, 
     2000; delete references to ``section 501(c)(3)'' of the 
     tax code in sections 7361 and 7363 of title 38, United 
     States Code. It would expand reporting requirements, 
     generally as provided for in the Senate bill except (to 
     conform more closely with reporting requirements set by 
     the Internal Revenue Service) that it omits any 
     requirement to isolate amounts received from tax-exempt 
     entities, and requires identification with respect to 
     payees only where the amount expended exceeds $35,000. The 
     provision would also clarify section 7366(b) by specifying 
     that corporations must obtain an audit performed by an 
     independent auditor. In the case of a corporation with 
     annual revenue greater than $300,000, the corporation 
     shall be audited annually. In the case of a corporation 
     with annual revenues between $10,000 and $300,000, the 
     measure requires that an audit be conducted at least once 
     every three years. Finally, the compromise includes an 
     amendment to simplify administration of the requirement 
     that corporation directors and employees are aware of and 
     comply with conflict-of-interest laws and regulations.


              veterans health administration headquarters

     Current law
       Subchapter I of chapter 73 of title 38 requires specified 
     clinical service positions in the Veterans Health 
     Administration and the Office of the Under Secretary for 
     Health.
     House bill
       Section 205 of H.R. 3376 would (a) repeal certain statutory 
     requirements regarding the organization and staffing of the 
     Office of the Under Secretary for Health; (b) authorize the 
     Under Secretary to include such professional and other 
     services as deemed necessary; and (c) ensure that the Office 
     is sufficiently staffed to provide expertise in clinical care 
     disciplines generally as well as in the unique, specialized 
     VA programs such as blind rehabilitation, prosthetics, spinal 
     cord dysfunction, mental illness and geriatrics and long-term 
     care.
     Senate health care bill
       Section 201 of S. 1359 would provide that the Secretary may 
     not alter or revise the organizational or administrative 
     structure of the Readjustment Counseling Service.
     Compromise agreement
       Section 344 is derived primarily from the House provision. 
     The Committees recognize,

[[Page S11652]]

     however, the importance of ensuring that the Under 
     Secretary's office be staffed so as to have a broad range of 
     clinical expertise and, particularly, expertise in VA's 
     special disability programs. Section 344, accordingly, would 
     require that in organizing the Office, the Under Secretary 
     shall ensure that the office is staffed in a manner such that 
     a designated clinician from the appropriate discipline serve 
     as a principal policy adviser with respect to (1) the VA's 
     unique special disability programs; and (2) the VA's 
     readjustment counseling program. With respect to the latter 
     program, it would require that the Under Secretary ensure 
     that a clinician with appropriate expertise is responsible 
     for the management of that program.
       The Compromise Agreement does not contain the statutory 
     repeals proposed in the House Bill. That legislation was 
     derived in part from of legislative proposal submitted by the 
     Department of Veterans Affairs, aimed at providing the Under 
     Secretary of Health greater flexibility to manage a modern 
     health care system. The Committees do not disagree with the 
     view underlying that proposal, that current law is unduly 
     prescriptive and that its centralized management model 
     impedes VA's ability to operate most effectively in a dynamic 
     health care environment. The loss of this provision in no way 
     diminishes support of the Under Secretary's efforts to 
     implement a field management structure which advocates 
     decentralization of authority, programmatic accountability, 
     and flexibility in organizational design and management. The 
     failure to include a provision revising sections 7305 and 
     7306 of title 38, U.S. Code, should not be construed as an 
     expression of agreement that those provisions any longer 
     represent a sound legislative policy.


   DISBURSEMENT AGREEMENTS RELATING TO MEDICAL RESIDENTS AND INTERNS

     Current law
       Section 7406(c) authorizes the use of disbursement 
     agreements which provide pay and other employee benefits to 
     residents and interns who train at VA hospitals. Current law 
     makes no specific provision for such agreements for residents 
     and interns who train at VA outpatient clinics, nursing homes 
     or other Department medical facilities.
     House bill
       Section 4 of H.R. 3643 would permit disbursement agreements 
     to be arranged for residents and interns who train at any VA 
     health care facility.
     Senate health care bill
       Section 111 contains an identical provision.
     Compromise agreement
       Section 345 contains this provision.


AUTHORITY TO SUSPEND SPECIAL PAY AGREEMENTS FOR PHYSICIANS AND DENTISTS 
                 WHO ENTER RESIDENCY TRAINING PROGRAMS

     Current law
       Subchapter III of chapter 74 authorizes ``special pay'' in 
     addition to basic pay to assist in physician recruitment and 
     retention. To receive special pay, a physician must enter 
     into a special pay agreement that carries certain service 
     obligations. Failure to complete that obligation triggers 
     refund liabilities. Under current law, employees incur a 
     refund liability any time they leave voluntarily. A waiver 
     can be granted only when the employee's breach of an 
     agreement is for reasons beyond their control, as provided by 
     section 7432(b)(2) of title 38. A physician or dentist who 
     enters a residency training program is converted to a special 
     appointment category that is excluded from receipt of special 
     pay. Entering a residency training position constitutes a 
     breach of the agreement and triggers the obligation to repay 
     the special pay that the physician or dentist received during 
     that year, thereby imposing adverse financial consequences on 
     those individuals entering residency training programs.
     House bill
       Section 5 of H.R. 3643 would temporarily suspend the 
     special pay agreement during residency training and allow the 
     return of the physician or dentist to VA employment without 
     incurring a special pay refund obligation.
     Senate health care bill
       Section 113 contains an identical provision.
     Compromise agreement
       Section 346 contains this provision.


    REMUNERATED OUTSIDE PROFESSIONAL ACTIVITIES BY VETERANS HEALTH 
                        ADMINISTRATION PERSONNEL

     Current law
       Section 7423(b)(1) prohibits full-time title 38 employees 
     from obtaining outside employment which involves assuming 
     responsibility for providing patient care.
     House bill
       H.R. 1384 would free registered professional nurses, 
     physician assistants, and expanded-duty dental auxiliaries of 
     this restriction on outside employment.
     Senate health care bill
       Section 112 would eliminate this restriction as to all 
     title 38 employees.
     Compromise Agreement
       Section 347 follows the Senate bill.


   MODIFICATION OF RESTRICTIONS ON REAL PROPERTY, MILWAUKEE COUNTY, 
                               WISCONSIN

     Current law
       The terms of a conveyance of a parcel of land from the VA 
     to Milwaukee County, Wisconsin, as authorized by statute in 
     1954, provided that such land was to be used for recreational 
     and other purposes, and that if the county were to attempt to 
     transfer title to a third party, title would automatically 
     revert back to VA. Unlike two other adjacent parcels of land 
     previously transferred from VA to the county, the deed of 
     conveyance made no provision for reversion ``at the option of 
     the United States''. Financing requirements associated with 
     planned construction of a baseball stadium on the tract now 
     require a transfer of title to the State. Legislation is 
     clearly needed to enable the county to transfer the 28-acre 
     tract, which would otherwise revert to the United States, to 
     the State of Wisconsin.
       VA has advised, with respect to its authority to weigh the 
     option of reversion, that it will not exercise the option in 
     favor of reversion back to the United States so long as the 
     existing statutory restrictions on use are followed. VA has 
     further advised that in the event that legislation is 
     introduced to modify the deed restrictions, the VA would not 
     object to releasing the properties from the restriction 
     against alienation.
     House bill
       Section 10 of H.R. 3643 would modify VA's reversionary 
     interest in the land which it had previously conveyed to 
     Milwaukee County and authorize VA to execute instruments to 
     permit the County to grant all or part of such land to 
     another party with a condition on such grant that the grantee 
     use the land only for civic and recreational purposes. It 
     would also provide that the conditions under which title to 
     all or any part of the land reverts to the United States are 
     stated so that any such reversion would occur at the option 
     of the United States.
     Senate bill
       There is no comparable provision in a Senate bill.
     Compromise agreement
       Section 348 follows the House Bill.


    MODIFICATION OF RESTRICTIONS ON REAL PROPERTY, CHEYENNE, WYOMING

     Current law
       Public Law 89-345 transferred VA-owned land adjacent to the 
     VA Medical and Regional Office Center (VAMROC) in Cheyenne, 
     WY, to the City of Cheyenne for park and recreational use. 
     The instrument of transfer provides that title to the land 
     will automatically revert to VA in the event the land is no 
     longer used for park and recreational purposes.
       The First Cheyenne Federal Credit Union in Cheyenne, WY, 
     proposes to build a building on the land previously 
     transferred to the City of Cheyenne for park and recreational 
     use. The City of Cheyenne, and VA, agree that such a transfer 
     would benefit VA, VA employees, and VA beneficiaries. 
     However, the statutory restriction on the use of the land, 
     and the reverter provision in the transfer instrument prevent 
     such a change in land use without authorizing legislation.
     House bill
       The House had no provision relating to this matter.
     Senate construction authorization bill
       Section 202 of the Senate bill would authorize VA to modify 
     the conditions under which the land would revert to VA, and 
     thereby authorize the transfer of the land from the City to 
     the First Cheyenne Federal Credit Union for the purpose of 
     constructing a building to house its operations.
     Compromise Agreement
       Section 349 follows the Senate provision.


EVALUATION OF HEALTH STATUS OF SPOUSES AND CHILDREN OF PERSIAN GULF WAR 
                                VETERANS

     Current law
       Section 107 of the Persian Gulf War Veterans' Benefits Act 
     (Public Law 103-446) requires the Secretary to conduct a 
     study to evaluate the health status of spouses and children 
     of Persian Gulf War veterans. Such study requires VA to 
     arrange for diagnostic testing and medical examinations of 
     such individuals through September 30, 1996.
     House bill
       The House bill contains no provision relating to this 
     matter.
     Senate health care bill
       The Senate bill would extend the program from September 30, 
     1996 to December 31, 1998.
     Compromise agreement
       The Compromise Agreement contains this provision in section 
     352(a). Section 352(b) would provide that any testing and 
     examinations conducted for the purposes specified in section 
     107 of Public Law 103-446 during the period beginning on 
     October 1, 1996, and ending on the date of enactment of the 
     Act are ratified.


    report on health care needs of veterans in east central florida

     Current law
       Two years ago, Congress appropriated construction funds to 
     convert the former Orlando Naval Training Center Hospital 
     (which was transferred to VA) into a nursing home. VA 
     currently operates an outpatient clinic at that facility, but 
     has not begun construction on the nursing home care unit. 
     Congress appropriated $17.2 million for the design of a 470-
     bed medical center and 120-bed nursing home in Brevard 
     County, Florida. That project, developed and proposed by VA,

[[Page S11653]]

     called for 230 psychiatric beds, 60 intermediate care beds, 
     an ambulatory care clinic and a number of surgical and 
     intermediate medicine beds. The Conference Report on the 
     Fiscal Year 1996 VA/HUD Appropriations bill, however, called 
     for allotting that design money, along with $7.8 million in 
     new funds, to design and construct a comprehensive outpatient 
     clinic in Brevard County.
     House Bill
       Section 104(a) would require the Secretary to report to the 
     Veterans' Affairs Committees not later than 60 days after the 
     date of enactment of this Act, on the health care needs of 
     veterans in east central Florida, and to include in that 
     report the Secretary's views as to the best means of meeting 
     such needs (and particularly their needs for psychiatric and 
     long-term care).
       Section 104(b) would limit the Secretary's authority to 
     obligate funds, other than for working drawings, for the 
     conversion of the former Orlando Naval Training Center in 
     Orlando, Florida, to a nursing home care unit until 45 days 
     after the date on which the report required in section 104(a) 
     is submitted.
     Senate construction authorization bill
       The Senate bill contains no comparable provision.
     Compromise agreement
       The Committees attach a high priority to meeting the needs 
     of veterans in Florida. With respect to outpatient care, the 
     Committees believe that construction of an outpatient clinic 
     in Brevard County should begin as soon as possible. While the 
     Conference Report on FY 1996 VA/HUD Appropriations addresses 
     Florida veterans' outpatient needs, it makes no provision for 
     meeting inpatient care needs that were to have been addressed 
     by the Brevard project, particularly the lack of long-term 
     psychiatric beds in the State of Florida.
       In light of the unresolved questions surrounding inpatient 
     needs, the Committees believe that a reassessment of the 
     health care needs of veterans in east central Florida is 
     needed. Section 351 of the bill would require the Secretary 
     to report to the Committees on how these veterans' needs 
     could best be met. It would specifically require the 
     Secretary to include in that report his views on how those 
     needs could best be met using existing facilities in east 
     central Florida. The Secretary's analysis should also include 
     a re-examination of other uses of the Orlando facility in 
     light of the changing needs of central Florida's veterans 
     population.


      renaming of the va medical center in johnson city, tennessee

     Current law
       The name of the VA medical center in Johnson City, TN, is 
     the Mountain Home Department of Veterans Affairs Medical 
     Center.
     House bill
       Section 302 of H.R. 3376 would rename the VA medical center 
     the ``James H. Quillen Department of Veterans Affairs Medical 
     Center'' on January 3, 1997.
     Senate bill
       There was no similar Senate provision.
     Compromise agreement
       Section 350 generally follows the House bill.


   renaming of the va nursing care center in aspinwall, pennsylvania

     Current law
       The name of the VA nursing home in Aspinwall, PA, is the 
     Aspinwall VA Nursing Care Center.
     House bill
       Section 303 of H.R. 3376 would rename the nursing home in 
     Aspinwall, PA the ``H. John Heinz, III Department of Veterans 
     Affairs Nursing Care Center.''
     Senate bill
       There was no similar Senate provision.
     Compromise Agreement
       The Compromise contains no provision relating to the 
     renaming of the Aspinwall VA Nursing Care Center.


               additional matters: west los angeles vamc

       The Department of Veterans Affairs is directed to 
     appropriately preserve for the Department's future needs, the 
     land on the grounds of the West Los Angeles Medical Center 
     bounded on the north by the VA property boundary, on the 
     south by Wilshire Boulevard, on the east by Sepulveda 
     Boulevard, and on the west by Bonsall Street. The Committee 
     supports uses such as the development of an interim park as a 
     memorial to veterans, or such other use as the Secretary may 
     determine to be consistent with needs of the Department. The 
     Committees understand that local community organizations are 
     willing to work with the Department to raise the private 
     funds to develop the land into a Veterans Memorial Park and 
     to maintain the Park until such time as funds may be 
     appropriated to convert the park to other uses consistent 
     with the mission of the Department that the Secretary 
     determines are in the best interest of the United States, 
     such as cemetery expansion. The Secretary is free to use the 
     property for events which provide benefit to veterans until 
     its development into the Veterans' Memorial Park. The 
     Department is directed not to dispose of the property or to 
     use it for commercial development not in furtherance of the 
     mission of the Department.
  Mr. ROCKEFELLER. Madam President, as the Ranking Minority Member of 
the Committee on Veterans' Affairs, I am enormously pleased that the 
Senate is considering H.R. 3118, a bill that would, among other things, 
reform current law relating to eligibility for VA health care. I urge 
my colleagues to give their unanimous support to this measure as it 
will be amended with a final compromise developed by the two Veterans' 
Affairs Committees.
  Madam President, before I discuss the content of this legislation, I 
will provide a brief procedural history so that those seeking to 
understand the background of the measure as it comes before the Senate 
today will be able to do so.
  H.R. 3118, as it will be amended, which I will refer to as the 
compromise agreement, includes a number of provisions in three titles.
  Title I of the bill contains the provisions which revise the law 
setting forth the criteria for eligibility for VA health care. The 
provisions in title I are a compromise between H.R. 3118 as passed by 
the House on July 30, 1996, and an original bill which the Senate 
Veterans' Affairs Committee ordered reported on July 24 of this year. 
Unfortunately, the committee was unable to complete and file its report 
on this legislation prior to today's action, so there is no formal 
record of our committee's efforts on this vital issue, a result I 
deeply regret. I will endeavor to provide some background on our 
committee's efforts later in my statement.
  Title II of the compromise agreement addresses VA medical 
construction matters, including providing authorization for specific 
projects. These provisions are a compromise between H.R. 3376, passed 
by the House on June 4, 1996, and an original bill ordered reported by 
the Senate Veterans' Affairs Committee on July 24. As with the 
eligibility reform legislation, the committee was not able to complete 
and file a report on this legislation prior to today's consideration by 
the Senate, so there is no formal record of our actions.
  Title III of the compromise agreement addresses a range of VA health 
care programs and services, including several that I have been 
particularly interested in for a number of years. These provisions are 
a compromise between a number of House bills--H.R. 1384, passed by the 
House on October 10, 1995; H.R. 3643, passed on July 16, 1996; and H.R. 
3118 and H.R. 3376--and a comprehensive Senate bill, S. 1359, as 
ordered reported by the Senate Veterans' Affairs Committee on July 24. 
The committee's report on that legislation, which was filed on 
September 26, describes the various bills which were combined in the 
bill as reported.
  Madam President, because a description of all of the provisions of 
the compromise agreement are set forth in the explanatory statement 
which Senator Simpson will place in the Record, I will just discuss 
some of the issues which are of particular interest to me. The 
explanatory statement was developed in cooperation with the House 
Committee on Veterans' Affairs and that committee's chairman, Rep. 
Stump, will insert the same explanatory statement in the Record when 
the House considers this measure.


                           Eligibility Reform

  While I supported the Senate committee's action in ordering reported 
eligibility reform legislation and I support the inclusion of 
provisions derived from that measure in the compromise agreement, I do 
so with some significant reluctance. My reluctance is twofold--first, I 
remain unconvinced that there is a compelling need for this action at 
this time; and second, it is unclear that the course of action we are 
pursuing is the most appropriate.
  Before discussing these concerns, I will outline briefly the 
legislative history of this legislation, and most particularly the 
activity in the Senate Committee on Veterans' Affairs. As I noted 
earlier, although eligibility reform legislation was ordered reported 
by our committee on July 24, a report was never filed. I believe it is 
important to provide some background on our committee's role in this 
effort.
  Madam President, the current drive for eligibility reform 
legislation--that is, legislation which would amend those provisions of 
title 38, United States Code, which set forth which veterans are 
eligible to receive what care from VA--dates back to at least 1985, my 
first year in the Senate. Late that

[[Page S11654]]

year, in the context of reconciliation legislation, both Houses passed 
legislation which would have amended the then-current law on access to 
VA care. The differences between those measures were resolved and the 
final compromise, which set forth a hierarchy of veterans as to whom VA 
was required to furnish inpatient care, was enacted in title XIX of 
Public Law 99-272, the Consolidated Omnibus Budget Reconciliation Act 
of 1985.
  That first attempt at setting forth in law exactly which veterans 
should be guaranteed what care from VA was limited to inpatient care 
because of significant differences between the House and Senate over 
the potential impact of providing such a guarantee for outpatient and 
other care, concerns that have persisted through to this Congress and 
that, as I will discuss later in my statement, remain largely 
unresolved. Indeed, there is some suggestion that those concerns cannot 
be resolved without some specific data-gathering initiative. And while 
it is not the sort of data-generating undertaking that I would prefer, 
what we are doing in the pending measure may be the way in which the 
Congress finally gets the information we need about demand for VA care 
and VA's ability to meet that demand within currently available 
resources.

  Following the enactment of COBRA, the next step in the effort to 
modify the law relating to access to VA care came in 1988 with the 
enactment, in Public Law 100-322, of legislation which set forth those 
groups of veterans who would be guaranteed certain access to outpatient 
care. Because of ongoing concerns about the demand for outpatient care 
and VA's ability to meet that demand in a timely fashion, the universe 
of veterans described in the law as guaranteed access to outpatient 
care was smaller than the universe with access to inpatient care and, 
within that group, only a small portion was guaranteed unlimited access 
to ambulatory care.
  Thus, under the law as it has been in effect since 1988, only a very 
small percentage of the veteran population--those with service-
connected disabilities rated at 50 percent or more disabling, a number 
less than 470,000 out of a total service-connected population of 2.2 
million--have comprehensive access to both VA inpatient and outpatient 
care. For the rest of the eligible veteran population, the greatest 
access to care is provided for inpatient care, with access to 
outpatient care much more restricted.
  Since 1988, there have been various efforts to amend the law. Last 
Congress, under my chairmanship, the committee made significant 
progress toward that goal. However, our efforts were carried out as 
part of the national health care reform effort. When that larger effort 
died, so too did the work of our committee.
  This Congress the issue was again before us and a number of events 
led up to our markup in July to consider eligibility reform 
legislation.
  For example, beginning early in 1995, I worked with the four veterans 
service organizations that prepare the Independent Budget--AMVETS, 
Disabled American Veterans, Paralyzed Veterans of America, and Veterans 
of Foreign Wars--to develop a draft eligibility reform bill based on 
those groups' testimony before our committee. Senator Simpson and I 
introduced this bill, S. 1563, in February of this year as a ``by 
request'' bill. In so doing, we both indicated that we were not 
endorsing the bill but merely making it available for consideration by 
the committee.
  Last September, VA submitted eligibility reform legislation to the 
Congress which Senator Simpson introduced, by request, as S. 1345 on 
October 18, 1995. Also last September, The American Legion, during its 
annual legislative presentation, presented its eligibility reform 
proposal.
  Finally, late in the first session, the House Committee on Veterans' 
Affairs included eligibility reform provisions as part of the 
legislation which that committee ordered reported to comply with 
reconciliation. These provisions were very similar to VA's proposal. 
Although the reconciliation measure passed the House with the 
eligibility reform provisions included, those provisions were not 
included in the conference report on that legislation. This session, 
the House again passed the eligibility reform provisions in H.R. 3118, 
which passed the House on July 30, 1996.

  Against this backdrop of activity and strong expressions of support 
from VA and the veterans community for committee action on eligibility 
reform legislation, our committee held two hearings on the issue. The 
first, on March 20, 1996, heard testimony from the General Accounting 
Office and a number of veterans organizations. The second, on May 8, 
1996, took testimony from VA and the Congressional Budget Office.
  Following those hearings and significant work to develop a proposal 
which could gain the support of the committee, the committee met on 
July 24 and ordered reported an original measure. It was that measure 
which became the basis for the compromise agreement which is before the 
Senate today.
  Our committee's action was premised on the position that whatever 
legislation we endorsed would have to eliminate the complexity and 
confusion in current law about which veterans would receive what care, 
but do so in a budget-neutral manner.
  To that end, the committee started from an approach similar to that 
incorporated in the VA and House bills, both of which sought to 
eliminate differences in the law on eligibility for inpatient and 
outpatient care and differences among groups of veterans in the access 
to types of outpatient care. In an attempt to achieve budget 
neutrality, both of those approaches made access to all care for all 
groups of veterans ``subject to appropriations,'' a limitation not 
included in current law. In addition, the House bill included a 
provision requiring VA to utilize an enrollment system to manage care. 
However, that provision did not appear to limit care to those veterans 
who participated in the enrollment system.
  The bill our committee ordered reported added three elements to the 
general format of the VA and House bills. I am pleased to note that 
provisions derived from two of those changes are included in the 
compromise agreement, and I regret that the third element is not 
included.
  The first change that our committee incorporated in the bill we 
ordered reported related to the way in which veterans' access to care 
is described in the law. As I just noted, both the House bill and the 
VA proposal use the phrase ``shall, subject to appropriations'' to 
describe access to care for all veterans. Under current law, the word 
``shall,'' with no limitation, is used to describe the access to care 
of those veterans who are included in what is known as the mandatory or 
``category A'' group, and the word ``may'' is used to describe the 
access of those veterans in what is known as the discretionary 
category. While there is some disagreement about the full meaning or 
scope of the word ``shall'' in the context of access to health care, it 
is important to note that it is not otherwise limited in current law.
  The bill ordered reported by the committee did not go as far as the 
House or VA bills, nor did we insist on maintaining current law. 
Instead, we took a middle ground. The bill we ordered reported provided 
that access to VA care for four subsets of the veterans' population--
veterans with service-connected disabilities rated at 50 percent or 
greater for any disability, all veterans with service-connected 
disabilities seeking care for those disabilities, former prisoners of 
war, and veterans of the Mexican border period and World War I--would 
remain as in current law, that is, by using ``shall'' without any 
limitation. For all others in the mandatory or category A 
classification, the ``shall, subject to appropriations'' approach of 
the House and VA bills was used.

  The approach adopted by our committee was designed to ensure that 
those veterans who have the highest claim on VA resources--veterans 
seeking care for their service-connected conditions and those more 
seriously disabled veterans for the treatment of any disability, as 
well as two categories of veterans whose service distinguishes them--
receive the care they need, with no reference to any external 
limitation. As a practical matter, that result should be ensured by 
other provisions of the legislation relating to priorities for care, 
but it was my view, shared by others on the committee, that the 
Congress should not be cutting back on the promise of current

[[Page S11655]]

law as to those veterans with the greatest claim on the system.
  Unfortunately, Mr. President, this effort to ensure that access to 
care is not compromised for these veterans for whom the system was 
established is not reflected in the compromise agreement. Initially, 
there was agreement that the compromise agreement would follow the 
Senate bill as to two of the four groups in the Senate bill--the more 
seriously disabled veterans and for the treatment of service-connected 
disabilities--and would apply the ``subject to appropriations'' 
limitation to all other category A veterans.
  However, very late in the process of developing the compromise 
agreement, the Congressional Budget Office, which had previously 
expressed no concerns about the approach in the Senate bill, suggested 
that the use of ``shall'' as to these veterans would create an 
entitlement to care and that, as a result, spending for such purposes 
would be mandatory spending, rather than discretionary spending as VA 
health care funding has always been treated. This, of course, raised 
budget problems for the legislation.
  One way to have avoided this problem would have been to drop the 
``subject to appropriation'' language and restore the approach found in 
current law. However, this approach did not enjoy unanimous support 
from the Members working on the compromise agreement. While I feel very 
strongly that appearing to cut back on the guarantee for care for these 
most deserving veterans is not the course we should be following, I 
realized that my insistence on either the Senate approach or a return 
to the phrasing of current law could well jeopardize the enactment of 
this legislation in this legislative session. Thus, I reluctantly 
agreed to the use of the ``subject to appropriation'' language as to 
all veterans. As I noted earlier, as a practical matter, these veterans 
will still be guaranteed first access to VA care as a result of the 
priority scheme in the compromise agreement.

  The second key difference between the bill our committee ordered 
reported and H.R. 3118 as passed by the House is the requirement that 
VA establish a rigorous enrollment system, rather than the apparently 
nonbinding system incorporated in the House bill. Under the approach in 
the Senate bill, only those who enroll, with certain exceptions, would 
be able to receive VA care. The purpose of this enrollment requirement 
is to create a mechanism that will ensure that those who desire VA care 
will know with some measure of certainty whether they will or will not 
receive such care within a particular enrollment period, which I 
anticipate will run for a year.
  Madam President, I am pleased that this enrollment provision has been 
included in the compromise agreement. So as to give VA the opportunity 
to prepare to implement this enrollment system, the requirement that 
veterans enroll in order to receive care will not take effect until 
October 1, 1998. It is my expectation that, in the coming year, VA will 
begin to implement an enrollment process so as to gain experience with 
this system, but will not deny care to any veteran because of a failure 
to have enrolled.
  The third difference between the bill our committee ordered reported 
and the House bill, at least as it was reported by the House Committee 
on Veterans' Affairs, was the inclusion in the Senate bill of a cap on 
the fiscal year 1997 appropriations so as to remove any doubt about the 
budget neutrality of the bill. This limitation is designed to avoid any 
suggestion that, if new demand for VA care is generated by the changes 
in access to care, additional appropriations will follow to meet the 
demand in the absence of specific authorization.
  The House bill was amended prior to House passage to include a 
similar cap, so there is no longer any substantive difference between 
the bills on this provision.
  Madam President, that is a brief outline of our committee's efforts 
on eligibility reform legislation. I regret that a more complete 
discussion is not available in a committee report, but I hope this 
discussion will shed some light on what our committee did and how we 
reached the final compromise agreement.
  Earlier I noted that my support for both the Senate committee's 
action and the pending final compromise is reluctant, at best. I will 
turn now to an explanation of my position, not so as to highlight my 
personal concerns but rather to note what I believe are pitfalls in 
what we are doing and as to which we must be aware as the eligibility 
reforms are put in place.
  At the outset, I note that I understand the concerns that many have 
expressed about the existing rules which set forth which veterans are 
eligible to receive what types of care from VA. The criticism that many 
raise about the complexity of these rules is certainly justified, as is 
the position that these eligibility rules do not reflect current trends 
in how and where health care is furnished.

  Madam President, I note one ironic aspect about this current effort 
to amend the VA eligibility law, namely that, as VA facilities convert 
to a primary care model under which veterans are assigned to primary 
care teams which manage how and when care is furnished, there is less 
and less attention being paid at the facility level to the limitations 
in the law on who is eligible for specific care. In fact, it might 
fairly be said that, at least as to those veterans who are already 
receiving VA care, eligibility reform is already taking place.
  In any event, while a case can be made that the current eligibility 
system is complex and difficult to defend, it has evolved as an 
appropriate response to demand and resources constraints over time and 
may have, to the extent it continues to be observed, a couple of 
advantages.
  First, it is a known system, and facilities and veterans across the 
system understand its implications in any given locale. Changing it, 
especially if the changes appear to broaden access to care, as the 
compromise agreement surely does, can easily create false expectations.
  The second advantage, related to the first, is that the current 
eligibility system is working to ration care. Facilities know when to 
use its restrictions--most especially on access to ambulatory care--to 
cut back on access so as to stay within budget. Replacing this system 
with an untested approach that relies on providing VA facilities with 
an unspecified authority to deny some veterans access to care is 
difficult to defend as a step forward.
  The current system's role in rationing care seems particularly 
important in this time of fiscal constraint. In past years, when the 
issue of eligibility for VA care has been debated, there were those who 
expressed the belief that any increased demand resulting from a change 
in eligibility would be addressed by increased appropriations. No one 
appears to hold that view today. Thus, it seems clear that some form of 
rationing will continue to be needed if the population of those 
veterans who are eligible for VA care is not adjusted to meet VA's 
capacity to provide care.
  Having said that, however, I note that my concerns about the 
compromise agreement bill do not stem from a view that the current 
eligibility rules must remain inviolate. Rather, my reluctance about 
this legislation is grounded in my belief that the Congress has a more 
involved role to play in determining the scope of VA health care than 
is reflected in the bill the Senate ordered reported or in the 
compromise agreement.
  Madam President, throughout our committee's efforts on this 
legislation, I have held to the premise, on which I think there is 
general agreement, that whichever veterans are made eligible for VA 
care should be able to receive all the care they need, of whatever 
sort, with the possible exception of long-term care, because of the 
costs of that care. It certainly could be otherwise--that is, certain 
groups of veterans could be given access only to certain care--but that 
seems to be directly contrary to the spirit of eligibility reform.

  With that as a guiding premise, and my certainty that VA will not 
receive any significant infusion of resources for health care at any 
time in the foreseeable future, it has been my view throughout the 
debate on eligibility reform that we, the Congress, should expressly 
set forth in law the population of veterans who are to receive 
comprehensive care from VA so that there would be no need for VA to 
make rationing decisions at the facility or other management level. 
However, as

[[Page S11656]]

the debate progressed, it became increasingly clear that developing 
such an approach was highly unlikely, both because we lacked data on 
which we might base a more comprehensive action and because reaching 
consensus on the specifics of such an approach was highly improbable.
  During the eligibility reform debate, the key questions as to which I 
have sought answers have been:
  First, in crafting legislation to define which veterans are to 
receive what care from VA, can we guarantee that those who are told 
they are eligible for care will be able to get that care without 
extensive delay?
  Second, if we assume that we should expand access to outpatient 
care--and I do--but that there will be no significant increase in VA's 
medical care appropriation, will the demand for care, and the costs 
associated with that demand, increase, remain static, or decrease? Who 
should make the inevitable rationing decisions?
  Third, and finally, do we have the necessary information to make 
informed decisions on these issue?
  While I acknowledge that these are difficult questions, without easy 
solutions, I have been greatly disappointed in the lack of answers that 
I have received, particularly from VA. While I believe that I have 
gained some further insight into some of these issues, much remains far 
from clear.
  For example, nothing VA has said has given me any satisfaction that 
the proposed eligibility reform proposals will help veterans or VA 
health care professionals answer with certainty the question of which 
veterans will receive care in a given time period.
  Likewise, nothing VA has provided sheds any light on the likely 
demand for care that will follow from the enactment of this reform 
package and the almost certain publicity about that will follow which 
will lead many veterans to believe that they now are eligible for 
comprehensive care from VA.
  However, as I noted earlier, one clear benefit of our action is that 
there will finally be an opportunity to see what happens when apparent 
access to VA care is expanded with no concomitant increase in 
resources. Once eligibility reform actually takes place, there will 
finally be some hard information on the impact of changing the 
definition of which veterans receive what care. This, in turn, will 
finally enable us to develop some understanding of whether those who 
believe that VA can furnish more care to more veterans within existing 
resources, or whether, as other believe, that eligibility reform 
legislation will generate significant new demand for care.

  Madam President, during our committee's consideration of eligibility 
reform we heard some very different views on this issue. Some, 
including CBO and GAO, believe that amending the law to provide such 
expanded access to VA care will result in a significant increase in 
demand, which either would be met through increased funding or, if new 
funding is not provided, will lead to delays in getting care or 
outright denial of care which in turn will generate significant unrest 
in the veteran community. Others believe that there is little, if any, 
suppressed demand for VA care and therefore do not believe that 
eligibility reform will result in any significant increased costs. 
Indeed, some who testified in support of eligibility reform expressed 
the belief that it is possible that changing the law will result in a 
net decrease in the cost of VA care because veterans will be able to be 
treated in the most appropriate setting, rather than being forced into 
inpatient care because that is the extent of their current eligibility.
  At this point, even after our hearings and all the followup actions 
associated with them, little more than speculation and best guesses 
support any of these positions.
  What is known is that VA has been appropriated just over $17 billion 
for medical care in fiscal year 1997. It may be that, operating under 
revised eligibility criteria, the Department will be able to furnish 
more care to a larger cohort of veterans at that funding level. But, in 
any event, that will be all the funds that will be available, come what 
may.
  Madam President, I am confident that the two committees and the 
Congress will be vigilant in our oversight of VA's implementation of 
this proposal, and, should it prove unsuccessful at matching scarce 
resources to demand for care, it will be modified in the years ahead.
  Madam President, I have a final thought on this issue before I turn 
to other parts of the bill. During this debate on eligibility reform, 
VA expressed the view that any eligibility reform legislation should 
meet six objectives:
  First, the eligibility system should be one that both the persons 
seeking care and those providing the care are able to understand.
  Second, the eligibility system should ensure that VA is able to 
furnish patients the most appropriate care and treatment that is 
medically needed, cost effectively and in the most appropriate setting.
  Third, veterans should retain eligibility for those benefits they are 
now eligible to receive.
  Fourth, VA management should gain the flexibility needed to manage 
the system effectively.
  Fifth, the proposal should be budget neutral.
  Sixth, the proposal should not create any new and unnecessary 
bureaucracy.
  Were I to grade the compromise agreement against this list, I'd say 
the only element that is clearly met is the fifth one--the measure is 
budget neutral. And while there can be some discussion about some of 
the others, the one that I think the bill fails to meet most 
dramatically is the first. Nothing in what we are doing, without a 
great deal more experience with the new eligibility criteria, will 
result in a system that can be understood by patients and providers 
alike.
  In fact, I believe that just the opposite is true--we are setting in 
place a system that no one will be able to predict or, at least in the 
near future, understand. Since it is clear that whatever changes are to 
take place must occur with no additional resources, it is a virtual 
certainty that VA will still need to ration care and to make decisions 
about how to do that. While this bill may, in time, yield a flexible, 
streamlined bureaucracy that establishes clear rules about which 
veterans are to get what care, that result is far from guaranteed. In 
the early years of this new system, it is far more likely that more 
resources will have to be dedicated to making decisions about who gets 
what care, resulting in a confusing, labor-intensive system.
  Madam President, despite my misgivings, it is clear that there is 
widespread support for our action on this issue. I intend to watch very 
closely as it goes forward and will be prepared to support any 
amendatory legislation needed as VA moves into this new era.


                         Contracting Authority

  Madam President, the compromise agreement contains two separate 
provisions relating to VA's authority to contract for health care 
services--section 301, which amends subchapter IV of chapter 81 of 
title 38, relating to VA's authority to share medical resources with 
non-VA entities; and section 304, which amends section 8110(c) of title 
38 relating to VA's authority to contract with outside entities for the 
conversion of VA activities to private activities. Taken separately, 
these two provisions both break substantial new ground in terms of 
giving VA greater latitude to provide services other than through in-
house resources. Together, the enactment of these provisions represents 
a potential sea change in how VA meets its health care mission.
  Madam President, I want to be very clear that the enactment of these 
provisions is meant to give VA managers greater flexibility to operate 
the VA health care system in the most effective manner available, 
consistent with meeting the obligation to furnish quality medical care 
to those veterans who are eligible for VA care and who seek such 
services and benefits. I intend to monitor very closely VA use of this 
new flexibility and will not hesitate to seek to reimpose limitations 
on the Department's contracting authority if it appears that either 
authority is being used in a manner that impinges on veterans' access 
to care in the name of fiscal restraint. I invite input from 
the veterans organizations, veteran patients, VA employees and their 
representatives, those organizations which represent groups of VA 
professionals, and others with an interest in the integrity of the VA 
health care system.

[[Page S11657]]

                                MIRECC'S

  Madam President, I am very pleased that a longstanding Senate 
initiative dating back nearly a decade--the establishment of VA centers 
of excellence in mental health research--is included in the compromise 
agreement. The provision in the compromise agreement is derived 
directly from legislation I originally introduced in S. 425 on February 
15, 1995, with the cosponsorship of committee member Senators Akaka, 
Dorgan, Wellstone, Murkowski, and Campbell.
  Madam President, this provision requires VA to establish up to five 
centers of excellence in the area of mental illness at existing VA 
health care facilities. These centers, to be known as Mental Illness 
Research, Education, and Clinical Centers [MIRECC's] will be a vitally 
important and integral link in VA's efforts in the areas of research, 
education, and provision of clinical care to veterans suffering from 
mental illness.
  As I noted at the time I introduced S. 425, the need to improve 
services to mentally ill veterans has been recognized for a number of 
years. For example, the October 20, 1985, report of the special 
purposes committee to evaluate the Mental Health and Behavioral 
Sciences Research Program of the VA, chaired by Dr. Seymour Kety--
generally referred to as the Kety Committee--concluded that research on 
mental illness and training for psychiatrists and other mental health 
specialists at VA facilities were totally inadequate. The Kety report 
noted that about 40 percent of VA beds are occupied by veterans who 
suffer from mental disorders, yet less than 10 percent of VA's research 
resources are directed toward mental illness.
  Little has changed since that report. The percentage of VA patients 
suffering from mental illness continues to hover over the same 40 
percent rate found by the Kety Committee, and little has changed with 
respect to VA's research on mental illness.
  VA provides mental health services to more than one-half to three-
quarters of a million veterans each year, yet in the years between the 
time the Kety Committee began its work and now, there has not been a 
significant effort to focus VA's resources on the needs of mentally ill 
veterans. Among the recommendations of the Kety Committee was one that 
VA centers of excellence be established to develop first-rate 
psychiatric research programs within VA. Such centers, in the view of 
the Kety Committee, would provide state-of-the-art treatment, increase 
innovative basic and clinical research opportunities, and enhance and 
encourage training and treatment of mental illness.
  Based on the recommendations of the Kety Committee, the Committee on 
Veterans' Affairs began efforts nearly 10 years ago to encourage 
research into mental illnesses and to establish centers of excellence. 
For example, on May 20, 1988, Public Law 100-322 was enacted which 
included a provision to add an express reference to mental illness 
research in the statutory description of VA's medical research mission 
which is set forth in section 7303(a)(2) of title 38.

  At that time, the committee urged VA to establish three centers of 
excellence, or MIRECC's, as proposed by the Kety Committee. 
Unfortunately, VA has done little to implement the recommendations of 
the Kety Committee.
  I also note that the January 1991 final report of the blue ribbon VA 
Advisory Committee for Health Research Policy recommended the 
establishment of MIRECC's as a means of increasing opportunities in 
psychiatric research and encouraging the formulation of new research 
initiatives in mental health care, as well as maintaining the 
intellectual environment so important to quality health care. The 
report stated that these ``centers could provide a way to deal with the 
emerging priorities in the VA and the Nation at large.''
  In light of VA's failure to act administratively to establish these 
centers of excellence, our committee has developed legislation to 
accomplish this objective. The proposed MIRECCs legislation is 
patterned after the legislation which created the very successful 
Geriatric Research, Education, and Clinical Centers [GRECC's], section 
302 of Public Law 96-330, enacted in 1980. The MIRECC's would be 
designed first, to congregate at one facility clinicians and research 
investigators with a clear and precise clinical research mission, such 
as PTSD, schizophrenia, or drug abuse and alcohol abuse; second, to 
provide training and educational opportunities for students and 
residents in psychiatry, psychology, nursing, social work, and other 
professions which treat individuals with mental illness; and third, to 
develop new models of effective care and treatment for veterans with 
mental illnesses, especially those with service-connected conditions.
  The establishment of MIRECC's should encourage research into outcomes 
of various types of treatment for mental illnesses, an aspect of mental 
illness research which, to date, has not been fully pursued, either by 
VA or other researchers. This provision will promote the sharing of 
information regarding all aspects of MIRECC's activities throughout the 
Veterans Health Administration by requiring the Under Secretary for 
Health to develop continuing education programs at regional medical 
education centers.
  Madam President, the VA for too long has made inadequate efforts to 
improve research and treatment of mentally ill veterans and to foster 
educational activities designed to improve the capabilities of VA 
mental health professionals. The establishment of MIRECC's will be a 
significant step forward in improving care for some of our neediest 
veterans. I am hopeful that this long recognized need will become more 
than a forgotten want item for veterans who suffer, in many cases, in 
silence.


                              Hospice Care

  Madam President, I am pleased that the compromise agreement includes 
a provision, section 341, which directs VA to carry out a research 
study on the desirability of VA furnishing hospice care services to 
terminally ill veterans and the most cost effective and efficient way 
to furnish such services. This provision is derived from legislation I 
authored which was included in S. 1359 as considered by the Senate 
committee. That legislation was in turn based on legislation dating 
back to the 102d Congress.
  Madam President, I have been pursuing an effort for a number of years 
to have VA closely examine the area of hospice care so as to have a 
basis for deciding the Department's role in meeting the needs of 
terminally ill veterans.
  In my view, it is important that VA develop the most cost-effective 
methods of providing treatment to those groups of veterans, especially 
those older veterans, who are most likely to seek VA services in the 
coming years. Among the methods that can meet the needs of an older 
population are a wide variety of community-based, noninstitutional 
services, including hospice care, which provides a compassionate 
alternative to customary curative care for terminally ill persons.
  During the Veterans' Affairs Committee's pursuit of this issue, there 
have been a number of hearings and submission of reports by VA. While 
the record before the committee on hospice care, including hearings in 
1991, 1993, and 1995, indicates that there is some focus on hospice 
care within VA, I am convinced that VA has moved ahead too cautiously 
to establish programs which achieve the goals of hospice care. For 
example, while VA, on April 30, 1992, issued a directive that required 
all VA medical centers [VAMC's] to implement hospice programs, that 
directive provided only vague guidelines, regarding the manner in which 
VAMC's should provide hospice care. As a result, significant variations 
now exist in the manner in which hospice care is provided at VAMC's.
  VA reports that all VA medical centers now have hospice consultation 
teams, consisting of at least a physician, nurse, social worker, and 
chaplain, and 56 out of 171 VAMC's have inpatient hospice units, 
freestanding buildings or separate units where a home-like atmosphere 
is created.
  While this is an increase in the total number of inpatient units in 
recent years, it is not clear that it demonstrates a significant change 
in the overall effort in support of hospice care. In answer to 
posthearing questions on its hospice programs, VA noted that ``most VA 
inpatient hospice units are small with an average size of 7 beds.'' 
Other VAMC's provide pain management and other services to terminally 
ill veterans in units in which hospice rooms are adjacent to rooms in 
which other patients are administered

[[Page S11658]]

curative care. Still other VAMC's only provide some hospice services 
such as caregiver counseling and pain management.
  Unfortunately, many VAMC's hospice efforts offer only an assessment 
of a terminally ill veteran's needs and referral to a non-VA hospice. 
While such referrals may benefit some veterans, they are of little 
value to the many veterans who are not entitled to Medicare or Medicaid 
or lack health insurance coverage for hospice care. Because VA has no 
authority under current law to contract with non-VA hospices, these 
veterans are left with the difficult choice of foregoing hospice care 
or using their own resources to pay for that care.
  Although I am convinced that VA should provide hospice care, I am not 
certain as to the best way for the Department to provide such care. 
Some assert that the only bona fide form of hospice care is through a 
program in which palliative care--noncurative care focusing on 
alleviating pain and other symptoms--and support services to meet the 
psychological, social, and spiritual needs of patients and their 
families are available in both home and inpatient settings. Others 
believe that equally effective care can be furnished by integrating 
hospice concepts into customary care. Similarly, there is considerable 
disagreement as to whether veterans who wish to receive hospice care 
are best served by VA hospice programs or through contracts with non-VA 
providers.
  Because I am satisfied that VA, to this point, has not carried out 
sufficient research to determine with any degree of certainty the most 
appropriate way in which to furnish hospice care, I have proposed 
legislation that would require VA to study the ways in which hospice 
care can successfully be furnished to veterans. That is what the 
provision in the compromise agreement calls for, and I look forward to 
VA's efforts to carry out this research and to the results of that 
study.
  Given the growing numbers of VA patients who are elderly or have 
fatal diseases who could benefit from hospice care, demand for VA 
hospice care is likely to increase. Research related to the provision 
of hospice care is critical not only to VA health care professionals, 
many of whose patients cannot rely on friends and family to provide all 
of the care they require, but also to other health care providers who 
will soon have to accommodate a great increase in the number of aging 
patients comparable to that which VA is presently providing care.


                     Mammography Quality Standards

  Madam President, I am delighted that the compromise agreement 
includes a provision, section 321, which seeks to ensure that women 
veterans are guaranteed that they will receive safe and accurate 
mammograms from or through VA. This provision is derived from 
legislation, S. 548, which I introduced last year.
  At present, under the Mammography Quality Standards Act of 1992, 
Public Law 102-539, all health care facilities--hospitals, outpatient 
departments, clinics, physicians' offices, or mobile units--are 
required to be certified by the Secretary of Health and Human Services 
as meeting specified standards for mammography in equipment, personnel, 
and quality assurance. That law, however, does not apply to VA 
facilities that operate their own mammography equipment.

  It is my strong opinion that women veterans who use VA facilities 
should have the same assurances as other women that their mammography 
tests will be performed properly and yield reliable information. The 
Secretary of Veterans Affairs agrees. In a letter to me, dated July 12, 
1993, Secretary Jesse Brown wrote, ``It is my intent that VA will 
comply with standards equal to those set forth in the Mammography 
Quality Standards of 1992 for all mammography done within VA facilities 
and require that all contracts and sharing agreements for mammography 
include a provision for compliance.''
  More recently, at the committee's October 25, 1995, hearing, Dr. 
Kenneth Kizer, VA's Under Secretary for Health, updated Secretary 
Brown's commitment, noting that ``VA policy now requires compliance 
with the requirements of the 1992 Mammography Quality Standards Act. 
Moreover, all VA facilities furnishing mammography services are 
currently using the FDA's guidelines.''
  Section 321 of the compromise agreement would ensure that the goal of 
giving women veterans safe and accurate mammograms continues to be met 
by requiring the Secretary to promulgate quality assurance and quality 
control regulations for VA facilities that furnish mammography that are 
no less stringent than the Department of Health and Human Services 
regulations to which other mammography providers are subject under the 
Mammography Quality Standards Act of 1992. VA facilities that contract 
with non-VA facilities would be required to contract only with 
facilities that comply with that act.


                           Outside Employment

  Madam President, I am pleased that the compromise agreement includes 
a provision, section 347, relating to the limitation in current law on 
certain VA health care personnel's ability to work outside of VA--the 
so-called ``moonlighting'' bar. Under current law, full-time VA 
professionals in seven professions--physicians, dentists, podiatrists, 
optometrists, nurses, physician assistants, and expanded-function 
dental auxiliaries--are not permitted to work in their professions 
during their non-duty times at VA.
  This provision was reported by our committee in S. 1359 after it was 
amended in committee in response to a concern of mine. As originally 
introduced in S. 1752, VA-proposed legislation, the legislation lifted 
the bar to outside work for only three of the seven professions listed 
in current law. In response to my concerns, the provisions removed the 
existing limitation as to all seven of the title 38 professions, 
including physicians, and not just to a portion of that population.


                               CONCLUSION

  Madam President, in closing, I acknowledge the work of my colleagues 
in the House, Chairman Bob Stump and the ranking minority member, Sonny 
Montgomery, and our committee's chairman, Senator Simpson, in 
developing the comprehensive legislation.
  Madam President, I thank the staff who have worked extremely long and 
hard on this compromise--Ralph Ibson, Lori Fertal, Pat Ryan, JoAnn 
Webb, Sloan Rappoport, and others on the House Committee, and Bill 
Brew, Jim Gottlieb, Bill Tuerk, Chris Yoder, and Tom Harvey with the 
Senate committee. I also thank Bob Cover and Charlie Armstrong of the 
House and Senate Offices of Legislative Counsel for their excellent 
assistance and support in drafting the compromise agreement.
  Mr. NICKLES. Madam President, I ask unanimous consent that the 
amendment be agreed to, the bill be deemed read a third time and 
passed, the amendment to the title be agreed to, the motion to 
reconsider be laid upon the table, and that any statements relating to 
the bill appear at the appropriate place in the Record.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The amendment (No. 5414) was agreed to.
  The bill (H.R. 3118), as amended, was deemed read a third time and 
passed.
  The title was amended so as to read: ``An act to amend title 38, 
United States Code, to reform eligibility for health care provided by 
the Department of Veterans Affairs, to authorize major medical facility 
construction projects for the Department, to improve administration of 
health care by the Department, and for other purposes.''

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