[Congressional Record Volume 144, Number 51 (Thursday, April 30, 1998)]
[Senate]
[Pages S3919-S3922]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. CLELAND:
  S. 2009. A bill to require the Secretary of Defense and the Secretary 
of Veterans Affairs to carry out joint reviews relating to 
interdepartmental cooperation in the delivery of medical care by the 
departments; to the Committee on Armed Services.


                    military health care legislation

  Mr. CLELAND. Mr. President, I am particularly honored to serve as the

[[Page S3920]]

ranking Democratic member of the Senate Armed Services Personnel 
Subcommittee, a charge I have embraced to its fullest. In the first 
session of the 105th Congress, I pledged my commitment to improving 
military health care. Today, I am here to discuss proposals to offer 
both immediate assistance and a time phased legislative strategy to 
fulfill this commitment.

  The Fiscal Year 1998 Defense Authorization Act (P.L. 105-85) included 
a Sense of the Congress Resolution which provided a finding that ``many 
retired military personnel believe that they were promised lifetime 
health care in exchange for 20 or more years of service,'' and 
expresses the sense of Congress that ``the United States has incurred a 
moral obligation'' to provide health care to members and retired 
members of the Armed Services and that Congress and the President 
should take steps to address ``the problems associated with the 
availability of health care for such retirees within two years.'' I 
authored that resolution, and today in year one of my two-year 
challenge, I stand ready to take the first of many necessary steps to 
fulfill this obligation.
  I call this obligation ``K-P Duty''--K-P as in KEEPING PROMISES. As a 
disabled veteran and retiree, as former head of the Veterans 
Administration, and as the Ranking Member on the Personnel 
Subcommittee, I am seeking to draft Congress and the entire nation and 
put us all on K-P Duty.
  Back when I was in the Army, some saw K-P or ``kitchen police'' as 
punishment. If a soldier was derelict in his duties, or if he broke the 
rules, he went on KP, where he served his fellow soldiers by working in 
the messhall.
  The K-P Duty I'm talking about is not about punishment, however. Yes, 
we as a nation have been derelict in our duties to our military 
personnel, active duty and retired. Yes, we have broken our promises. 
But the K-P Duty I'm talking about is a sacred honor. It is about a 
grateful nation paying respect to those soldiers who made tremendous 
sacrifices for our Country. The soldiers who won World War II, who won 
the Cold War--the soldiers that have made it possible for the United 
States to be the world's only super power. It is our time, indeed it is 
past time, to serve these soldiers and fulfill our obligation.
  As with any draft in an army, the first order of business is 
bootcamp. As long as I have taken the liberty of drafting the entire 
Congress, I might as well serve as drill instructor. Let me take this 
time to ``drill'' the Senate on the basics of this challenge.
  Not only do we have to fulfill our promise, we also have to 
reconsider the way in which the military and veterans health care 
systems work. It is the change in the demographics of military health 
care beneficiaries that necessitates a change in the way that we 
administer health care.
  When I went on active duty, the military was made up of mostly single 
male soldiers. Looking at the all-volunteer, totally-recruited force 
today, the picture is much different. Now, 57 percent of all enlisted 
members and 73 percent of all officers are married. Not surprisingly, 
the number of young dependents has also risen. In terms of recruitment, 
quality health care is cited as a major incentive for young men and 
women who join the military. It is that same health care for soldiers 
and their families that helps retain these soldiers in the military. 
Recently, I heard the adage, ``the military recruits a soldier, but 
retains a family.''
  Since the time I was a U.S. Army Captain 30 years ago, the number of 
active duty personnel has undergone a 58 percent reduction. 
Concurrently, the number of retirees has more than doubled. The 
Government Accounting Office reports that approximately 48 percent of 
the beneficiaries of the Department of Defense Military Health System 
are active duty members and dependents. The remaining 52 % are retirees 
and dependents. 71% of military retirees are under the age of 65, while 
29% of military retirees are over the age of 65.
  As we consider options for improving the DoD and VA health care 
systems, we need to be mindful of some basic facts. About 60% of 
retirees under the age 65 live near a military treatment facility but 
only about 52% the retirees aged 65 and older live near such a 
facility. About two thirds of retirees under age 65 used the military 
health system. In comparison, only about a quarter of the retirees aged 
65 and older used military medical facilities on a space available 
basis primarily for pharmacy services.
  According to a 1994-95 survey of DoD beneficiaries, over 40 percent 
of military retirees, regardless of age, had private health insurance 
coverage. About a third of retirees aged 65 and older also reported 
having additional insurance to supplement their Medicare benefits. 
Approximately 14% of retirees under age 65 had insurance to supplement 
their CHAMPUS coverage.
  In this same dynamic environment of the past 30 years, the medical 
portion of the DoD budget has increased dramatically from approximately 
two percent to six percent. In part, this can be attributed to cost 
growth from technology and intensity of treatment in the private and 
public sectors. It is interesting to note the converse relationship 
between the increase in health care dollars as the number of active 
duty personnel decreases and the number of retirees increases.
  The Military Health System (MHS) and the Veterans Health 
Administration are well established institutions that collectively 
manage over 1500 hospitals, clinics, and health care facilities world-
wide, providing services to over 11 million beneficiaries. Overseeing 
these systems requires a well-planned and executed effort.
  The Veterans Health Administration is a system in transition. In the 
past two years, the VA has replaced its structure of four regions, 33 
networks, and hundreds of clinics with a new system geared to 
decentralizing authority into 22 Veterans Integrated Service Networks. 
The purpose of the reorganization was to improve the access, quality 
and efficiency of care provided to the Nation's veterans. The hallmark 
of the network structure is that the field has been given control over 
functions which were previously located in Washington. The majority of 
quality-related activities were transferred closer to the site of 
patient care.
  The Military Health System has also changed. During the Cold War, 
that system was designed to support full-scale, extremely violent war 
with the Soviet Union and its allies in Europe. The collapse of the 
Soviet Union and the end of the Warsaw Pact led to a major reassessment 
of the U.S. defense policy. The overall size of the active duty force 
has been reduced by one-third since the mid-1980s.
  The DoD health care system changes have included the establishment of 
a managed care program, numerous facility closures, and significant 
downsizing of military medical staff. In the last decade, the number of 
military medical personnel has declined by 15 percent and the number of 
military hospitals has been reduced by one-third. The National Defense 
Authorization Act for Fiscal Year 1994 directed DoD to prescribe and 
implement a nationwide managed health care benefit program modeled on 
health maintenance organization plans and in 1995, beneficiaries began 
enrolling in this new program called TRICARE. With over 8 million 
beneficiaries, it is the largest health maintenance organization plan 
in the Nation.

  One of the problems with TRICARE is what happens to retirees when 
they reach the age of 65. They are ineligible to participate in 
TRICARE. The law currently provides for transition from military health 
care to Medicare for these beneficiaries. This is not the right 
solution, especially given the fact that Medicare does not currently 
reimburse the DoD for health care services, although Congress recently 
authorized a test of this concept. In addition, as the military begins 
to close and downsize military treatment facilities, retirees over 65 
are unable to seek and obtain treatment on a space available basis. The 
retirees over 65 are, in effect, being shut out of the medical 
facilities promised to them.
  The changing health care environment has created its own set of 
unique challenges. To assess these varied and special requirements, I 
formed a Military Health Care Reform Working Group of senior officials 
in government and the private sector to explore innovative solutions to 
improve the military and veterans health care systems. During the past 
few months this group analyzed the array of military and veterans 
health care issues and recently provided a comprehensive report of

[[Page S3921]]

their findings and recommendations to me.
  In March, I hosted a military health care roundtable at Fort Gordon, 
Georgia. The positive and supportive working relationship between the 
Eisenhower Army Medical Center and the Veterans Administration Medical 
Center in Augusta, Georgia was highlighted by the panel speakers and 
audience members. These facilities have established a sharing agreement 
which allows each to provide certain health care services to the 
beneficiaries of the other. This type of joint approach has the 
potential to alleviate a significant portion of the accessibility 
problem faced by military retirees, especially given the reduction in 
DoD medical treatment facilities. In spite of these benchmarked efforts 
in cooperative care, beneficiaries who were in the audience still 
attested to insufficient accessibility to resources to meet their 
needs.
  Public Law 97-174, ``The Veterans Administration and Department of 
Defense Health Resources Sharing and Emergency Operations Act,'' was 
enacted in 1982 specifically to promote cost-effective use of federal 
health care resources by minimizing duplication and underuse of health 
care resources while benefitting both VA and DoD beneficiaries. Under 
this law, VA and DoD pursue programs of cooperation ranging from shared 
services to joint venture operations of medical facilities. Sharing 
agreements are developed on a local basis, whereas, joint ventures are 
developed at the highest levels within an organization or command.
  In 1984, there were a combined total of 102 VA and DoD facilities 
with sharing agreements. By 1997, that number had grown to 420. In five 
years, between FY 1992 and FY 1997, shared services increased from 
slightly over 3,000 to more than 6,000 services ranging from major 
medical and surgical services, laundry, blood, and laboratory services 
to unusual speciality care services. VA and DoD currently have four 
joint ventures in operation in New Mexico, Nevada, Texas, Oklahoma, and 
four more in planning for Alaska, Florida, Hawaii, California.
  In my opening remarks, I suggested that there are things that we can 
do immediately and others that can be accomplished through a near term 
time phased legislative strategy to fulfill our moral obligation to 
active duty and retired service personnel. Let me first discuss some of 
the options.
  There has been an overwhelming outpouring of support for offering 
Federal Employee Health Benefits Program (FEHBP) to military retirees. 
Although this program has achieved a successful reputation among 
federal employees, it is a costly alternative which necessitates close 
scrutiny, along with other health care options. I appreciate the fact 
that there are many advantages to FEHBP. Furthermore, I share the view 
that health care for military retirees should be at least as good as 
the health care we in the Congress afford ourselves. I am committed to 
working closely on the FEHBP option.
  The Medicare Subvention demonstration project that is scheduled to 
begin enrollment in the near future involves TRICARE Prime. 
Unfortunately, it will only benefit retirees who live near military 
treatment facilities--which is only about half of all retirees. Those 
retirees living outside catchment areas won't benefit from subvention. 
Additionally, there are ongoing efforts to initiate a Veterans Affairs 
Subvention test. The limiting criteria of these tests is that they 
require beneficiaries to live near the respective treatment facilities. 
To accommodate those beneficiaries that do not live near treatment 
facilities or within the catchment area, we must explore other 
alternatives, including, as I mentioned, the FEHBP option.
  Today, I am announcing two initiatives. The first is a bill to 
require the Department of Defense and the Department of Veterans 
Affairs to significantly enhance their cooperative efforts in the 
delivery of health care to their respective beneficiaries. Several 
measures to enhance military health care efficiencies are already being 
explored, and the initiative I am proposing would complement these 
efforts without any direct impact on current spending. Let me just 
highlight some of the elements of my plan.
  The first element directs DoD and the VA to conduct a comprehensive 
survey to determine the demographics of their beneficiaries, their 
geographic distribution, and their preferences for health care. A 
second survey would review the range of existing DoD and VA facilities 
and resources and the capacity available for cooperative efforts. The 
purpose of these reviews is simple. We need to accurately determine who 
we are serving, what they want, and what resources we currently have to 
provide to them.
  The second element directs DoD and the VA to provide to the Congress 
a report on any and all impediments which preclude optimal cooperation 
and/or integration between DoD and VA in the area of health care 
delivery. We need to know what statutory restrictions, regulatory 
constraints, and cultural issues stand in the way of full and complete 
cooperation between the two departments. They would be directed to 
recommend to the Congress what changes should be made in the law. 
Furthermore, they would be directed to eliminate any regulatory and 
cultural impediments.
  The third element addresses several projects that have been 
undertaken by the Departments of Defense and Veterans Affairs that can 
be accelerated for near term implementation. The Electronic Transfer of 
Patient Information, a collaborative effort by DoD and VA which would 
provide for immediate transfer of and access to patient records at the 
time of treatment is a project which merits Congressional support. The 
DoD and VA have also established the DoD/VA Federal Pharmaceutical 
Steering Committee. I believe this committee should perform a 
comprehensive examination of existing pharmaceutical benefits and 
programs, including current management and utilization of mail order 
pharmaceuticals. Finally, the initiative directs DoD to review the 
extent of VA participation in TRICARE networks and to take steps to 
ensure optimal participation by the VA.
  The second initiative I am announcing today is legislation which is 
being crafted to respond to the tremendous outcry to provide health 
care for military retirees over 65. Mr. President, as you know, S. 
1334, a bill to provide for a test of the FEHBP plan has 60 cosponsors. 
It is my plan to work with my friend and colleague Senator Kempthorne 
in the Senate Armed Services Committee to include in the National 
Defense Authorization bill a proposal that addresses this matter this 
year.
  I recognize that there is a perception that our military benefits are 
eroding but I am here today to say that we can change this perception 
if we all do our share on K-P Duty. Greater cooperation among the DoD 
and VA will yield greater choices for the beneficiaries of these 
systems. Developing a viable health care alternative for our retirees 
over 65, a group that has been largely disenfranchised, will ensure 
that now all beneficiaries have access to the health care to which they 
are entitled because of their service to this Nation.
  We made a promise, now let's keep it. It is as simple as that.
  Mr. President, I ask unanimous consent that the full text of the bill 
be printed in the Record.
  There being no objection, the bill was ordered to be printed in the 
Record, as follows:

                                S. 2009

       Be it enacted by the Senate and House of Representatives of 
     the United States of America in Congress assembled,

     SECTION 1. FINDINGS.

       Congress makes the following findings:
       (1) The military health care system of the Department of 
     Defense and the Veterans Health Administration of the 
     Department of Veterans Affairs are national institutions that 
     collectively manage more than 1,500 hospitals, clinics, and 
     health care facilities worldwide to provide services to more 
     than 11,000,000 beneficiaries.
       (2) In the post-Cold War era, these institutions are in a 
     profound transition that involves challenging opportunities.
       (3) During the period from 1988 to 1998, the number of 
     military medical personnel has declined by 15 percent and the 
     number of military hospitals has been reduced by one-third.
       (4) During the two years since 1996, the Department of 
     Veterans Affairs has revitalized its structure by 
     decentralizing authority into 22 Veterans Integrated Service 
     Networks.
       (5) In the face of increasing costs of medical care, 
     increased demands for health care services, and increasing 
     budgetary constraints, the Department of Defense and the

[[Page S3922]]

     Department of Veterans Affairs have embarked on a variety of 
     dynamic and innovative cooperative programs ranging from 
     shared services to joint venture operations of medical 
     facilities.
       (6) In 1984, there was a combined total of 102 Department 
     of Veterans Affairs and Department of Defense facilities with 
     sharing agreements. By 1997, that number had grown to 420. 
     During the six years from fiscal year 1992 through fiscal 
     year 1997, shared services increased from slightly over 3,000 
     services to more than 6,000 services ranging from major 
     medical and surgical services, laundry, blood, and laboratory 
     services to unusual speciality care services.
       (7) The Department of Defense and the Department of 
     Veterans Affairs are conducting four health care joint 
     ventures in New Mexico, Nevada, Texas, Oklahoma, and are 
     planning to conduct four more such ventures in Alaska, 
     Florida, Hawaii, and California.

     SEC. 2. SENSE OF CONGRESS.

       It is the sense of Congress that--
       (1) the Department of Defense and the Department of 
     Veterans Affairs are to be commended for the cooperation 
     between the two departments in the delivery of medical care, 
     of which the cooperation involved in the establishment and 
     operation of the Department of Defense and the Department of 
     Veterans Affairs Executive Council is a praiseworthy example;
       (2) the two departments are encouraged to continue to 
     explore new opportunities to enhance the availability and 
     delivery of medical care to beneficiaries by further 
     enhancing the cooperative efforts of the departments; and
       (3) enhanced cooperation is encouraged for--
       (A) the general areas of access to quality medical care, 
     identification and elimination of impediments to enhanced 
     cooperation, and joint research and program development; and
       (B) the specific areas in which there is significant 
     potential to achieve progress in cooperation in a short term, 
     including computerization of patient records systems, 
     participation of the Department of Veterans Affairs in the 
     TRICARE program, pharmaceutical programs, and joint physical 
     examinations.

     SEC. 3. JOINT SURVEY ON POPULATIONS SERVED.

       (a) Survey Required.--The Secretary of Defense and the 
     Secretary of Veterans Affairs shall jointly conduct a survey 
     of their respective medical care beneficiary populations to 
     identify, by category of beneficiary (defined as the 
     Secretaries consider appropriate), the expectations of, 
     requirements for, and behavior patterns of the beneficiaries 
     with respect to medical care. The two Secretaries shall 
     develop the protocol for the survey jointly, but shall obtain 
     the services of an entity independent of the Department of 
     Defense and the Department of Veterans Affairs for carrying 
     out the survey.
       (b) Matters To Be Surveyed.--The survey shall include the 
     following:
       (1) Demographic characteristics, economic characteristics, 
     and geographic location of beneficiary populations with 
     regard to catchment or service areas.
       (2) The types and frequency of care required by veterans, 
     retirees, and dependents within catchment or service areas of 
     Department of Defense and Veterans Affairs medical facilities 
     and outside those areas.
       (3) The numbers of, characteristics of, and types of 
     medical care needed by the veterans, retirees, and dependents 
     who, though eligible for medical care in Department of 
     Defense or Department of Veterans Affairs treatment 
     facilities or other federally funded medical programs, choose 
     not to seek medical care from those facilities or under those 
     programs, and the reasons for that choice.
       (4) The obstacles or disincentives for seeking medical care 
     from such facilities or under such programs that veterans, 
     retirees, and dependents perceive.
       (5) Any other matters that the Secretary of Defense and the 
     Secretary of Veterans Affairs consider appropriate for the 
     survey.
       (c) Report.--The Secretary of Defense and the Secretary of 
     Veterans Affairs shall submit a report on the results of the 
     survey to the appropriate committees of Congress. The report 
     shall contain the matters described in subsection (b) and any 
     proposals for legislation that the Secretaries recommend for 
     enhancing Department of Defense and Department of Veterans 
     Affairs cooperative efforts with respect to the delivery of 
     medical care.

     SEC. 4. REVIEW OF IMPEDIMENTS TO COOPERATION.

       (a) Review Required.--The Secretary of Defense and the 
     Secretary of Veterans Affairs shall jointly conduct a review 
     to identify impediments to cooperation between the Department 
     of Defense and the Department of Veterans Affairs regarding 
     the delivery of medical care. The matters reviewed shall 
     include the following:
       (1) All laws, policies, and regulations, and any attitudes 
     of beneficiaries of the health care systems of the two 
     departments, that have the effect of preventing the 
     establishment, or limiting the effectiveness, of cooperative 
     health care programs of the departments.
       (2) The requirements and practices involved in the 
     credentialling and licensure of health care providers.
       (3) The perceptions of beneficiaries in a variety of 
     categories (defined as the Secretaries consider appropriate) 
     regarding the various Federal health care systems available 
     for their use.
       (b) Report.--The Secretaries shall jointly submit a report 
     on the results of the review to the appropriate committees of 
     Congress. The report shall include any proposals for 
     legislation that the Secretaries recommend for eliminating or 
     reducing impediments to interdepartmental cooperation that 
     are identified during the review.

     SEC. 5. PARTICIPATION OF DEPARTMENT OF VETERANS AFFAIRS IN 
                   TRICARE.

       (a) Review Required.--The Secretary of Defense shall review 
     the TRICARE program to identify opportunities for increased 
     participation by the Department of Veterans Affairs in that 
     program. The ongoing collaboration between Department of 
     Defense officials and Department of Veterans Affairs 
     officials regarding increasing the participation shall be 
     included among the matters reviewed.
       (b) Semiannual Report.--The Secretary of Defense and the 
     Secretary of Veterans Affairs shall jointly submit to the 
     appropriate committees of Congress a semiannual report on the 
     status of the review and on efforts to increase the 
     participation of the Department of Veterans Affairs in the 
     TRICARE program. No report is required under this subsection 
     after the submission of a semiannual report in which the 
     Secretaries declare that the Department of Veterans Affairs 
     is participating in the TRICARE program to the extent that 
     can reasonably be expected to be attained.

     SEC. 6. PHARMACEUTICAL BENEFITS AND PROGRAMS.

       (a) Examination Required.--(1) The Federal Pharmaceutical 
     Steering Committee shall--
       (A) undertake a comprehensive examination of existing 
     pharmaceutical benefits and programs for beneficiaries of 
     Federal medical care programs, including matters relating to 
     the purchasing, distribution, and dispensing of 
     pharmaceuticals and the management of mail order 
     pharmaceuticals programs; and
       (B) review the existing methods for contracting for and 
     distributing medical supplies and services.
       (2) The committee shall submit a report on the results of 
     the examination to the appropriate committees of Congress.
       (b) Report.--The committee shall submit a report on the 
     results of the examination to the appropriate committees of 
     Congress.

     SEC. 7. STANDARDIZATION OF PHYSICAL EXAMINATIONS FOR 
                   DISABILITIES.

       The Secretary of Defense and the Secretary of Veterans 
     Affairs shall submit to the appropriate committees of 
     Congress a report on the status of the efforts of the 
     Department of Defense and the Department of Veterans Affairs 
     to standardize physical examinations administered by the two 
     departments for the purpose of determining or rating 
     disabilities.

     SEC. 8. APPROPRIATE COMMITTEES OF CONGRESS DEFINED.

       For the purposes of this Act, the appropriate committees of 
     Congress are as follows:
       (1) The Committee on Armed Services and the Committee on 
     Veterans' Affairs of the Senate.
       (2) The Committee on National Security and the Committee on 
     Veterans' Affairs of the House of Representatives.

     SEC. 9. DEADLINES FOR SUBMISSION OF REPORTS.

       (a) Report on Joint Survey of Populations Served.--The 
     report required by section 3(c) shall be submitted not later 
     than January 1, 2000.
       (b) Report on Review of Impediments to Cooperation.--The 
     report required by section 4(b) shall be submitted not later 
     than May 1, 1999.
       (c) Semiannual Report on Participation of Department of 
     Veterans Affairs in TRICARE.--The semiannual report required 
     by section 5(b) shall be submitted not later than January 1 
     and June 1 of each year.
       (d) Report on Examination of Pharmaceutical Benefits and 
     Programs.--The report on the examination required under 
     section 6 shall be submitted not later than 60 days after the 
     completion of the examination.
       (e) Report on Standardization of Physical Examinations for 
     Disabilities.--The report required by section 7 shall be 
     submitted not later than June 1, 1999.
                                 ______