[Congressional Record (Bound Edition), Volume 148 (2002), Part 1]
[Senate]
[Pages 563-565]
[From the U.S. Government Publishing Office, www.gpo.gov]




                     TESTIMONY OF RICHARD J. SANTOS

 Mr. DOMENICI. Madam President, I ask that testimony inserted 
into the Budget Committee record from Richard J. Santos, the National 
Commander of the American Legion, be printed in the Record.
  The testimony follows.

    Written Statement of Richard J. Santos, National Commander, the 
American Legion to the Committee on the Budget, U.S. Senate Concerning 
              the Fiscal Year (FY) 2003 Budget Resolution

       Mr. Chairman and Members of the Budget Committee: The 
     American Legion welcomes the opportunity to present its views 
     on the FY 2003 Budget Resolution. As you and your colleagues 
     consider the President's recent budget request, I share the 
     views of the nation's largest wartime veterans' service 
     organization.
       The American Legion's reputation as an advocate for 
     maintaining a strong national defense is well documented, 
     dating back to its very beginning in 1919 in Paris, France. 
     As veterans of the War to End All Wars, The American Legion 
     founders established an organization:
       To uphold and defend the Constitution of the United States 
     of America;
       To maintain law and order;
       To foster and perpetuate a one-hundred percent Americanism;
       To preserve the memories and incidents of our associations 
     in the Great Wars;
       To inculcate a sense of individual obligation to the 
     community, state, and nation;
       To combat autocracy of both the classes and the masses;
       To make right the master of might;
       To promote peace and good will on earth;
       To safeguard and transmit to posterity the principles of 
     justice, freedom and democracy;
       To consecrate and sanctify our comradeship by our devotion 
     to mutual helpfulness.
       The only common bond of all Legionnaires is honorable 
     military service during a period of armed conflict. 
     Legionnaires are men and women that belong to an organization 
     based upon comradeship. This group of veterans is devoted to 
     fair and equitable treatment of their fellow veterans, 
     especially the service-connected disabled. Another group of 
     veterans honored by The American Legion is those fallen 
     comrades that are killed in action (KIA), missing in action 
     (MIA), or those held as prisoner of war (POW). These service 
     members often leave spouses and children behind. For those 
     who have paid the ultimate sacrifice for freedom, The 
     American Legion will honor their service by making sure this 
     nation fulfills its promises to their survivors. For those 
     listed as MIA or POW, The American Legion will continue to 
     demand the fullest possible accounting of each and every 
     comrade.


                           NATIONAL SECURITY

       The deep-rooted interest of The American Legion in the 
     security of the nation was born in the hearts and minds of 
     its founders and sustained by its current membership. The 
     bitter experiences of seeing comrades wounded or killed 
     through lack of proper training crystallized the 
     determination of Legionnaires to fight for a strong, 
     competent defense establishment capable of protecting the 
     sovereignty of the United States. The tragic events of World 
     War I, largely precipitated by unprepared military, were 
     still vivid in the minds of combat veterans that founded The 
     American Legion. After 22 years of repeated warnings by The 
     American Legion, Pearl Harbor dramatically illustrated the 
     cost of failed vigilance and complacency.
       For over 83 years, The American Legion's drumbeat on 
     defense issues has remained constant. With the evolution of 
     space age technology and scientific advancement of 
     conventional and nuclear weapons, The American Legion 
     continues to insist on a well-equipped, fully manned, and a 
     properly trained fighting force to deter aggressors. The 
     events surrounding September 11, 2001 publicly exposed a soft 
     underbelly of America to acts of terrorism, especially the 
     vulnerability to nuclear, biological, and chemical (NBC) 
     warfare.
       America's armed forces must be well manned and equipped, 
     not to pursue war, but to preserve the hard-earned peace. The 
     American Legion is fully aware of what can happen when 
     diplomacy and deterrence fail. Many military experts believe 
     that the current national security is based on budgetary 
     concerns rather than real threat levels to America and its 
     allies. As the world's remaining superpower, America's armed 
     forces need to be more fully structured, equipped, and 
     budgeted.
       Defense budget, military manpower, and force structure are 
     currently improving over the FY 2001 levels. The current 
     operational tempo of active-duty and Reserve and Guard forces 
     remains extremely high and very demanding. The American 
     Legion recommends:
       Active-duty personnel level should not be less than 1.6 
     million.
       The Army must maintain 12 fully manned, equipped, and 
     trained combat divisions.
       The Navy must maintain 12 aircraft carrier battle groups 
     and a viable strategic transport capability.
       The Air Force must maintain, at a minimum, 15 fighter 
     wings, a strategic bombing capability, its Intercontinental 
     Ballistic Missile capability and a global strategic transport 
     capability.
       Deployment of a national missile defense system.
       The defense budget should equal 3-4 percent of the Gross 
     Domestic Product.
       The current active-duty personnel level is approximately 
     1.37 million. Military leaders are making up the difference 
     by increasing the operations tempo and by over-utilizing the 
     Reserve components. Currently, American military personnel 
     are deployed to over 140 countries worldwide. Overseas 
     deployments have increased well over 300 percent in the past 
     decade. Many of these personnel continue to come from the 
     Reserve and Guard components.
       Cuts in force structure cannot be rapidly reconstituted 
     without the costly expenditures of time, money, and human 
     lives. Modernization of weapon systems is vital to properly 
     equipping the armed forces, but are totally ineffective 
     without adequate personnel to effectively operate the state-
     of-the-arts weaponry. The American Legion strongly recommends 
     adequate funding for modernization of the services. America 
     is losing its technological edge. No American soldier, 
     sailor, airman, or Marine should be ordered into battle with 
     obsolete weapons, supplies, and equipment. America stands to 
     lose its service members on the battlefield and during 
     training exercises due to aging equipment. The current 
     practice of trading off force structures and active-duty 
     personnel levels to recoup modernization resources must be 
     discontinued.
       The American Legion recommends restoring the force 
     structure to meet the threat level and to increase active-
     duty personnel levels. Ensuring readiness also requires 
     retaining the peacetime Selective Service System to register 
     young men for possible military service in case of a national 
     emergency. Military history repeatedly demonstrates that it 
     is far better to err on the side of preserving robust forces 
     to protect America's interest than to suffer the consequences 
     of ill preparedness. America needs a more realistic strategy 
     with an appropriate force structure, weaponry, equipment, and 
     active-duty personnel leave to achieve its objectives.
       A major national security concern is the enhancement of the 
     quality-of-life issues for service members, Reservists, 
     National Guard, military retirees, and their families. During 
     the First Session, President Bush and Congress made marked 
     improvements in an array of quality-of-life issues for 
     military personnel and their families. These efforts are 
     visual enhancements that must be sustained. The cost of 
     freedom is on going, from generation to generation.
       The President and Congress addressed improvements to the 
     TRICARE system to meet the health care needs of the military 
     beneficiaries; enhanced the Montgomery GI Bill educational 
     benefits; and homelessness throughout the veterans community. 
     For these actions, The American Legion applauds your strong 
     leadership, dedication, and commitment. However, one issue 
     still remains unresolved: the issue of concurrent receipt of 
     full military retirement pay and VA disability compensation 
     without the current dollar-for-dollar offset. The issue of 
     concurrent receipt appeared in the FY 2002 budget resolution 
     and the FY 2002 defense authorization act. Every day, new 
     severely disabled military retirees are joining the ranks of 
     American heroes being required, by law, to forfeit military 
     retirement pay.
       Recently, 14 soldiers and 2 airmen were awarded Purple 
     Hearts from the War on Terrorism. These newest American 
     heroes would be the latest victims of this injustice should 
     their war wounds result in debilitating medical conditions. 
     During the State of the Union Address, one such future 
     recipient, SFC Ronnie Raikes, was sitting next to the First 
     Lady. Concurrent receipt legislation in both chambers (S. 170 
     and H.R. 303) has overwhelming support by your colleagues. 
     With the President's proposed $48 billion increase in defense 
     spending, The American Legion believes now is the time to 
     correct this terrible injustice. Enactment of corrective 
     legislative and fully funding concurrent receipt are actions 
     to properly reward heroism and courage under fire.
       If America is to continue as the world's remaining 
     superpower, it must operate from a position of strength. This 
     strength can only be sustained through meaningful leadership 
     and adequate funding of the armed forces.


                         veterans' health care

       The American Legion believes that the primary mission of 
     the Department of Veterans Affairs (VA) is to meet the health 
     care needs of America's veterans. The American Legion 
     believes that the VA should continue to receive appropriate 
     funding in order to maximize its ability to provide world-
     class health

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     care to the large number of aging veterans, while still 
     maintaining services to a younger cohort of veterans who are 
     using VA for the first time. The American Legion greatly 
     appreciates the actions of all Members of Congress regarding 
     the increase in VA Medical Care funding for FY 2002. Now, 
     please focus your attention to the increases in FY 2003.
       Just like the Medicare and Medicaid programs, the VA health 
     care budget requires an annual increase to maintain its 
     existing service level and to fund new mandates. For years, 
     VA managers wee asked to do more with less. The recent 
     funding increase now allows the Veterans Health 
     Administration (VHA) to catch up with the growing demands 
     placed upon the system and repair some of the problems 
     related to long patient waiting times and limitations on 
     access to care.
       The American Legion felt that the President's budget 
     request last year failed to accurately reflect VA's FY 2002 
     health care funding needs. VA's projections misrepresented 
     the actual number of veterans seeking care. It appears that 
     the President's budget request was based on a much lower 
     number of patients projection (less than 3 percent) than the 
     actual number of users (closer to 11 percent). Fortunately, 
     Congress added over $300 million to the President's original 
     request; however, VHA is now faced with dealing with an 
     inadequate FY 2002 budget. The American Legion believes that 
     close to 5 million veterans will seek care in VHA medical 
     facilities in FY 2003. Last year, The American Legion 
     requested $21.6 billion in FY 2002; however, this year we 
     recommend $23.1 billion for VA medical care.
       Many factors are driving more veterans to use VHA as their 
     primary health care provider:
       Many Medicare+Choice health maintenance organizations 
     (HMOs) withdrew from the program;
       Many HMOs collapsed;
       VHA has opened community based outpatient clinics;
       Double-digit increase in health care premiums;
       The dramatic fluctuations in the national economy make VHA 
     a more cost-effective option for veterans; and
       VHA's reputation for quality of care and patient safety is 
     attracting new patients.
       Where comparable data exist, VHA continues to outperform 
     the private sector in all indicators in health promotion and 
     disease prevention. The American Legion adamantly believes 
     VHA is the best health care investment of tax dollars. The 
     average cost per patient treated within VHA is unmatched by 
     any other major health care delivery system, especially with 
     comparable quality of care.
       Mr. Chairman and Members of the Committee, the reason VHA 
     medical care continues to increase annually is not because of 
     uncontrollable cost increases nor poor cost estimations, but 
     rather because thousands of veterans are voting with their 
     feet. More and more veterans are choosing to use their earned 
     benefit--access to VHA. However, enrollment in VHA is limited 
     to existing discretionary appropriations. The American Legion 
     urges Congress to evaluate several options that would assure 
     every veteran that wants to enroll in VHA can enjoy that 
     earned benefit. The key factor driving the increases in 
     medical care funding requirements has not been uncontrolled 
     cost increases, nor has it been poor cost estimation 
     processes--it has been the unexpected and dramatic increase 
     in demand for care from the VA system.
       The overall guiding principle for VA must be improved 
     services to veterans, their dependents, and survivors. This 
     will require improving access and timeliness of veterans' 
     health care; increasing quality and timeliness in the benefit 
     claims process; and enhancing access to national and state 
     cemeteries. Specific American Legion objectives for Congress 
     include:
       Sound VHA funding for long-term strategic planning and 
     program performance measurement,
       Additional revenue for staff and construction,
       Medicare subvention,
       Pilot programs for certain dependents of eligible veterans,
       VA and DoD sharing,
       Reduce the claims backlog,
       Repeal bar to service-connection for tobacco-related 
     illnesses,
       Increase the rate of beneficiary travel reimbursement, and
       Allow all third-party reimbursements collected by VA to 
     supplement, rather than offset, the annual Federal 
     discretionary appropriations.
       The American Legion created the GI Bill of Health as a 
     blueprint for meeting the current and future health care 
     requirements of the nation's veterans and for supplementing 
     VA's annual health care appropriation. The GI Bill of Health, 
     once fully implemented, would expand VHA's patient base and 
     increase its non-appropriated funding through new revenue 
     sources.
       As VHA continues to re-invent itself, change is not a 
     defining event, but rather a series of small steps. Despite 
     its recent successes, VHA still faces numerous future 
     challenges.
       The American Legion believes VHA's long-term future must be 
     clearly defined to be responsive to those who have ``borne 
     the battle.'' All individuals, who enter military service, 
     should be assured that there is a health care system 
     dedicated to serving their needs upon leaving the military. 
     That concept is especially important to disabled veterans and 
     to retired service members. The GI Bill of Health would 
     ensure that all honorably discharged veterans would be 
     eligible for VA health care, as they will fall into one of 
     the core entitlement categories and into a health insurance 
     or buy-in category. A unique feature of the GI Bill of Health 
     is that it will also permit certain dependents of veterans to 
     enroll in the VA health care system.
       The American Legion commends VA for the changes made within 
     VHA over the past few years. These changes include 
     eligibility reform, enrollment, the reorganization of the 172 
     medical centers into 22 integrated operating units, the 
     elimination of certain fiscal inefficiencies, and the 
     expansion of community based outpatient clinics. In some 
     cases, The American Legion believes VA has gone too far in 
     attempting to improve fiscal efficiency. Veterans should not 
     have to increase their travel time for the benefit of the 
     Department. Rather, VHA needs to improve its cooperation with 
     other Federal, state, and private health care providers to 
     improve the quality and timeliness of care for veterans and 
     their families. The American Legion encourages VHA to 
     continue to provide health care that is the highest quality 
     to all veterans at the most reasonable cost.
       Two additional significant steps required to re-engineer 
     VHA are Medicare subvention and permitting certain dependents 
     of veterans to utilize the system.
       Unlike in the private sector, Medicare-eligible veterans 
     cannot use their Medicare benefits in a VHA facility for 
     treatment of nonservice-connected conditions. When Medicare-
     eligible veterans receive health care treatment for any 
     medical condition in the private sector, the federal 
     government reimburses the health care provider for a portion 
     of that service. When Medicare-eligible veterans receive 
     health care treatment for the same medical conditions 
     (nonservice-connected) within VHA, the federal government 
     will not reimburse VHA for any portion of that service. This 
     equates to a restriction on a veteran's right to access 
     health care of his or her choice and using his or her 
     Medicare benefit. The American Legion believes that Medicare 
     subvention will result in more accessible, quality health 
     care for all Medicare-eligible veterans. Furthermore, 
     Medicare subvention should greatly reduce incidents of fraud, 
     waste, and abuse in billing because it will occur between two 
     Federal agencies with congressional oversight. Today's fiscal 
     realities requires VHA to seek other revenue streams to 
     supplement the growing demand for service and not simply rely 
     on saving more dollars to serve more veterans. The American 
     Legion strongly recommends allowing Medicare subvention for 
     Priority Group 7 Medicare-eligible veterans enrolled in VHA.
       Allowing certain veterans' dependents access to health care 
     within VHA will also help develop new revenue streams and 
     will ultimately improve recruitment and retention within the 
     armed forces. Service members need to know that their 
     dependents have access to quality health care while serving 
     on active duty. The American Legion believes that VHA can and 
     should play a larger role in the provision of this care to 
     active duty service members. Additionally, when service 
     members leave active duty, this health care coverage should 
     continue. VHA has the capacity and the capability to play a 
     much larger role in the provision of health care to the 
     beneficiaries of DoD health care system.
       VHA has six strategic goals through the year 2006:
       Put quality first.
       Provide easy access to medical knowledge, expertise and 
     care.
       Enhance, preserve and restore patient function.
       Exceed customers' expectations.
       Save more dollars to serve more veterans.
       Build healthy communities.
       Unfortunately, nowhere in the list of VHA priorities are 
     the goals of Medicare-subvention, the treatment of veterans' 
     dependents, expanding the non-appropriated funding revenue 
     base, and greater cooperation with the private sector and 
     with DoD health care system.


                           Veterans' Benefits

       Given the number of veterans and other claimants who file 
     claims each year and with an annual expenditure of over $25 
     billion in compensation and pension payments, it is 
     imperative that Congress maintain strong oversight of the 
     operations of Veterans Benefit Administration's (VBA's) 
     Compensation and Pension Service.
       Over the last several years, the backlog of pending claims 
     and appeals has increased dramatically and now exceeds over 
     660,000 cases. It routinely takes six months to a year or 
     more to process disability compensation claims. In addition, 
     annually, some 60,000 to 70,000 new appeals are initiated. 
     After a wait of over two years for an appeal to reach the 
     Board of Veterans Appeals (BVA or the Board), more than 20 
     percent will be allowed and more than 22 percent will be sent 
     back to the regional office for further required development 
     and readjudication.

[[Page 565]]

     Remanded cases may be pending for another year or two, in the 
     regional office before returning to the Board. Sometimes, 
     cases are remanded two and three times because the specified 
     corrective action had not been completed, which adds several 
     more years to the appeal.
       Unfortunately, there is a pattern of recurring issues, 
     which continue to have a direct and adverse effect on the 
     quality and timeliness of regional office claims 
     adjudication. They relate to budget, staffing, training, 
     quality assurance, accountability, and attitude. These 
     findings confirm our long-held view that quality must be 
     VBA's highest priority. Without guaranteed quality, thousands 
     of claims will continue to process unnecessarily through the 
     system: much of VBA's valuable financial and personnel 
     resources will be wasted; and veterans will not receive the 
     benefits and services they are entitled to and that Congress 
     intended they should have.
       The American Legion believes VBA is committed to bringing 
     about much needed change to the claims adjudication system 
     with the overall goal of providing quality, timely service to 
     veterans and its other stakeholders. In recent years, VBA's 
     strategic plans have made many promises and we have, in fact, 
     seen the implementation of a variety of programmatic and 
     procedural changes. However, it is obvious that progress 
     toward major improvements in service continues to be slow and 
     that much remains to be done. The overall quality of regional 
     office decision making remains problematic.
       Secretary Principi has identified many problems and is 
     working diligently to find solutions that will provide 
     improved service to veterans and their families. There are a 
     spectrum of ongoing and planned initiatives, such as the Pre-
     Discharge Examinations, Personnel Information Exchange System 
     (PIES), Electronic Burial Claims, Virtual VBA, Decision 
     Review Officer (DRO) Program, and personal hearing 
     teleconferencing, just to name a few. In addition, VBA has 
     begun implementing the recent recommendations of the 
     Secretary's Claims Processing Task Force focusing on 
     improving the operating efficiency of the process and 
     procedures by which claims are adjudicated. These involve 
     special initiatives to better manage the claims and appeals. 
     There will be an emphasis on better training for the newly 
     hired adjudicators. Performance standards are being 
     implemented that provide for personal and organization 
     accountability. VBA is continuing the development of its 
     information technology program.
       While we support these much-needed changes, we are 
     concerned that they only indirectly address the core problem 
     of continued poor quality decision making. Without a 
     vigorous, comprehensive quality assurance program, thousands 
     of claims will continue to process needlessly through the 
     regional offices, the Board of Veterans Appeals, and the 
     courts wasting time, effort and taxpayers' money. Veterans 
     have a right to a fair, proper, and timely decision. They 
     should not have to endure financial hardship and delay before 
     receiving the benefits to which they are entitled by law.
       The workload and budgetary requirements of National 
     Cemetery Administration (NCA) will continue to grow over the 
     next 15-20 years. The death rate of World War II veterans 
     will peak in 2008, but the annual death rate of veterans will 
     not return to 1995 levels under 2020. The death rates of 
     Korean and Vietnam Era veterans will greatly accelerate 
     thereafter. The American Legion continues to fully support 
     the further development of the State Cemetery Grants Program.
       The Veterans Millennium Health Care and Benefits Act 
     (Public Law 106-117) requires VA to provide long-term nursing 
     care to veterans rated 70 percent disabled or greater. The 
     new law also requires VA to provide long-term nursing care to 
     all other veterans for service-connected disabilities and to 
     those willing to make a co-payment to offset the cost of 
     care. Further, it requires VA to provide veterans' greater 
     access to alternative community-based long-term care 
     programs. These long-term care provisions will place greater 
     demand on VA and on the State Veterans Home Program for years 
     to come.
       The American Legion believes that it makes economic sense 
     for VA to look to States governments to help fully implement 
     the provisions of PL 106-117. VA spends on average $225 per 
     day to care for each of their nursing care patients and pays 
     private-sector contract facilities an average per diem of 
     $149 per contract veteran. The national average daily cost of 
     care for a State Veterans Home nursing care resident is about 
     $140. VA reimburses State Veterans Homes a per diem of $40 
     per nursing care resident. Over the long term, VA saves 
     millions of dollars through the State Veterans Home Program.
       The American Legion supports the State Veterans Home 
     Program and believes the federal government must provide 
     sufficient construction funding to allow for the expected 
     increase in long-term care veteran patients.
       On September 11, 2001, I was about to present testimony 
     before a Joint Session of the Veterans' Affairs Committees, 
     when we were directed to evacuate the Cannon House Office 
     Building. Like Americans around the world, I was shocked by 
     the barbaric, terrorist actions taken against innocent 
     airline passengers, those in the World Trade Towers, and 
     those in the Pentagon. My heart swelled with pride as 
     fearless rescue workers, fellow service members, and private 
     citizens rushed to assist the victims, only to experience the 
     heartache as the Twin Towers collapsed turning heroes into 
     victims in a matter of seconds. At that specific moment, the 
     importance of that testimony paled in comparison. The 
     American Legion's efforts, like the rest of America, shifted 
     to what we do best--helping at the community, state, and 
     national level.


                                Summary

       Since I was unable to formally present my testimony, I did 
     submit The American Legion's recommendations for the VA 
     budget for FY 2003 for the record. Today, it is important 
     that I share that information to this Committee:

----------------------------------------------------------------------------------------------------------------
                                                                                             Legion's FY 2003
               Program                      P.L. 106-377              P.L. 107-73                request
----------------------------------------------------------------------------------------------------------------
Medical Care........................  $20.2 billion...........  $21.3 billion..........  $23.1 billion.
Medical and Prosthetics Research....  350 million.............  371 million............  420 million.
Construction:
    Major...........................  66 million..............  183 million............  310 million.
    Minor...........................  170 million.............  211 million............  219 million.
State Veterans' Home................  100 million.............  100 million............  110 million.
State Veterans' Cemeteries..........  25 million..............  25 million.............  30 million.
NCA.................................  110 million.............  121 million............  140 million.
General Administration..............  1 billion...............  1.2 billion............  1.3 billion.
----------------------------------------------------------------------------------------------------------------

       The American Legion believes that the true character of any 
     democracy is best reflected in the way it treats its veterans 
     of the armed forces--the true preservers and defenders of 
     liberty.

       Mr. Chairman, and Members of the Committee, that concludes 
     my written statement.

                          ____________________