[Congressional Record Volume 149, Number 67 (Wednesday, May 7, 2003)]
[Senate]
[Pages S5872-S5873]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. CORZINE (for himself and Mrs. Clinton):
  S. 1014. A bill to amend title 38, United States Code, to require the 
Secretary of Veterans Affairs in the management of health care services 
for veterans to place certain low-income veterans in a higher health-
care priority category; to the Committee on Veterans' Affairs.
  Mr. CORZINE. Mr. President, I rise today along with Senator Hillary 
Rodham Clinton to change the way the Veterans' Administration defines 
low-income veterans by taking into account variations in the cost of 
living in different parts of the country. The Corzine-Clinton 
legislation would make the Veterans Equitable Resource Allocation just 
that: Equitable.
  More specifically, this bill would replace the national income 
threshold for consideration in Priority Group 5--currently $24,000 for 
all parts of the country--with regional thresholds defined by the 
Department of Housing and Urban Development. This simple but far-
reaching proposal would help low-income veterans across the country 
afford quality health care and ensure that Veterans Integrated Service 
Networks or VISNs receive adequate funding to care for their distinct 
veteran populations.
  Our Nation's veterans have made great sacrifics in defense of 
American freedom and values, and we owe them a tremendous debt of 
gratitude. The United States Congress must ensure that all American 
veterans--veterans who have sweated in the trenches to defend liberty--
have access to quality health care.
  In 1997, Congress implemented the Veterans Equitable Resource 
Allocation system, or VERA, to distribute medical care funding provided 
by the VA. The funding formula was established to better take into 
account the costs associated with various veteran populations. 
Unfortunately, the VERA formula that was created fails to take into 
account regional differences in the cost of living, a significant 
metric in determining veteran healthcare costs. This oversight in the 
VERA formula dangerously shortchanges veterans living in regions with 
high costs of living and elevated healthcare expenses.
  To allocate money to the Veterans Integrated Service Networks, VISNs, 
VERA divides veterans into eight priority groups. Veterans who have no 
service-connected disability and whose incomes fall below $24,000 are 
considered low income and placed in Priority Group 5, while veterans 
whose incomes exceed this national threshold and qualify for no other 
special priorities are placed in either Priority Group 7c or Priority 
Group 8. VERA only reimburses the treating Medical Care facility for 
the care that they provided to veterans in priority groups 1-5 and does 
not provide any Federal reimbursement for the care provided to priority 
group 7 and 8 veterans.
  Using a national threshold for determining eligibility as a low-
income veteran puts veterans living in high cost areas at a decided 
disadvantage. In New Jersey, HUD's fiscal year 2002 standards for 
classification as ``low-income'' exceed $24,000 per year in every 
single county. And some areas exceed the VA baseline by more than 50 
percent. Similarly, HUD's ``low-income'' classification for New York 
City is set at $35,150, and for Nassau and Suffolk Counties, at 
$40,150.
  As a result, regions that have a high cost of living, like VISN 3, 
which encompasses substantial portions of New Jersey and New York, tend 
to have a reduced population of Priority Group 5 veterans and an 
inflated population of Priority Group 7c and 8 veterans.
  The fundamental inequity of the VERA formula is apparent when you 
consider the VERA allocations do not take into account the number of 
veterans classified in Priority Groups 7c and 8. Because of the costs 
associated with these Priority Groups 7c and 8 veterans are not 
considered as part of the VERA allocation, and because high cost of 
living areas have large populations of Priority Group 7c and 8 
veterans, high cost regions must provide care to thousands of veterans 
without adequate funding.
  This additional financial burden on VISNs with large populations of 
non-reimbursable veterans in Priority Group 7c and 8 has had a 
tremendous impact on VISN 3. Since FY 1996, VISN 3 has experienced a 
decline in revenue of 10 percent. As a result of the tremendous 
shortfall in the VISN 3 budget, the VA cannot move forward with plans 
to open clinics in various locations, including prospective clinics in 
Monmouth and Passaic Counties. Consequently, veterans in VISN 3 are 
forced to wait for unreasonably long periods to receive medical care 
and travel long distances to existing clinics, and those veterans who 
are able to access care are being treated in facilities operating under 
tremendous financial difficulty.
  Furthermore, miscategorizing which vets quality as Priority Group 5 
unjustifiably reduces access to medical care for thousands of veterans. 
Under existing rules, veterans placed in Priority and Groups 7c and 8 
must provide a copayment to receive medical care at a VA medical 
facility; Veterans placed in Priority Group 5 receive medical care free 
of charge. Under the existing

[[Page S5873]]

framework, low-income vets in high cost areas are often inappropriately 
placed in Priority Groups 7c and 8, and are forced to provide a 
copayment.
  Recent studies by both the RAND Institute and the General Accounting 
Office identify this flaw in the VERA formula and recommend a 
geographic means test like the one provided in our legislation to 
improve the allocation of resources under VERA. Such a test would 
ensure that the VERA formula allocation better reflects the true costs 
of VA healthcare in the various VISNs in the United States.
  Our legislation would make a simple adjustment to the VERA formula to 
account for variations in the cost of living in different regions. The 
bill would help veterans in high cost areas afford VA health care and 
guarantee that VISNs across the country receive adequate compensation 
for the care they provide.
  I hope my colleagues will join Senator Clinton and me in supporting 
this important bill, and I ask unanimous consent that the text of the 
legislation be printed in the Record.
  There being no objection, the bill was ordered to be printed in the 
Record, as follows:

                                S. 1014

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

     SECTION 1. DEPARTMENT OF VETERANS AFFAIRS HEALTH CARE 
                   PRIORITY FOR CERTAIN LOW-INCOME VETERANS BASED 
                   UPON REGIONAL INCOME THRESHOLDS.

       (a) Change in Priority Category.--Section 1705(a) of title 
     38, United States Code, is amended--
       (1) in paragraph (5)--
       (A) by inserting ``(A) who are'' after ``Veterans'';
       (B) by inserting ``and'' after ``through (4)''; and
       (C) by inserting before the period at the end the 
     following: ``, or (B) who are described in section 1710(a)(3) 
     of this title and are eligible for treatment as a low-income 
     family under section 3(b) of the United States Housing Act of 
     1937 (42 U.S.C. 1437a(b)) for the area in which such veterans 
     reside, regardless of whether such veterans are treated as 
     single person families under paragraph (3)(A) of such section 
     3(b) or as families under paragraph (3)(B) of such section 
     3(b)'';
       (2) by striking paragraph (7); and
       (3) by redesignating paragraph (8) as paragraph (7) and in 
     that paragraph by striking ``paragraph (7)'' and inserting 
     ``paragraph (5)(B)''.
       (b) Conforming Amendment.--Section 1710(f)(4) of such title 
     is amended by striking ``section 1705(a)(7)'' and inserting 
     ``section 1705(a)(5)(B)''.
       (c) Effective Date.--The amendments made by this section 
     shall take effect on October 2, 2002.
                                 ______