[Senate Report 107-229]
[From the U.S. Government Publishing Office]



                                                       Calendar No. 534
107th Congress                                                   Report
                                 SENATE
 2nd Session                                                    107-229

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



 
   DEPARTMENT OF VETERANS AFFAIRS EMERGENCY PREPAREDNESS ACT OF 2002

                                _______
                                

                 July 31, 2002.--Ordered to be printed

                                _______
                                

Mr. Rockefeller, from the Committee on Veterans' Affairs, submitted the 
                               following

                              R E P O R T

                         [To accompany S. 2132]

    The Committee on Veterans' Affairs, to which was referred 
the bill S. 2132, to amend title 38, United States Code, to 
provide for the establishment of medical emergency preparedness 
centers in the Veterans Health Administration, to provide for 
the enhancement of the medical research activities of the 
Department of Veterans Affairs, and for other purposes, having 
considered the same, reports favorably thereon with an 
amendment in the nature of a substitute and an amendment to the 
title, and recommends that the bill, as amended, do pass.

                              Introduction

    On October 16, 2001, the Committee held a hearing to 
consider VA's readiness and capacity to care for veterans, 
active duty servicemembers, and the public during conflicts and 
national emergencies, and its role in the Federal response to 
disasters. Those testifying at the hearing included: The 
Honorable Anthony J. Principi, Secretary, Department of 
Veterans Affairs (hereinafter, ``VA''); The Honorable Claude A. 
Allen, Deputy Secretary of Health and Human Services; The 
Honorable David Chu, Ph.D., Under Secretary of Defense for 
Personnel and Readiness; and Bruce P. Baughman, Director, 
Planning and Readiness Division, Readiness, Response, and 
Recovery Directorate, Federal Emergency Management Agency.
    On April 16, 2002, Committee Chairman John D. Rockefeller 
IV introduced S. 2132. S. 2132, as introduced, would have 
amended provisions of title 38, United States Code, to 
authorize the establishment of four medical emergency 
preparedness centers in VA's Veterans Health Administration 
(hereinafter, ``VHA''); to modify the authorities of VA non-
profit research and education corporations to transfer 
appropriated funds and to act as affiliated institutions for 
sharing of health care resources; and to allow employees of 
these corporations assigned to approved VA projects to be 
considered VA employees for the purposes of Federal Tort Claims 
Act and medical malpractice coverage.
    On April 17, 2002, Chairman Rockefeller introduced S. 2186 
at the request of the Administration. S. 2186 would have 
amended title 38 to establish a new Assistant Secretary to 
coordinate functions relating to emergency preparedness, 
continuity of operations, security, and law enforcement.
    On April 17, 2002, Chairman Rockefeller introduced S. 2187 
with the co-sponsorship of Committee member Daniel K. Akaka. 
Ranking Member Arlen Specter later cosponsored the bill. S. 
2187 would have authorized the Secretary of Veterans Affairs to 
furnish hospital care and medical services to affected 
individuals during and immediately following a disaster or 
emergency declared by the President or in which the National 
Disaster Medical System is activated.
    On May 2, 2002, Chairman Rockefeller held a hearing to 
receive testimony on the aforementioned bills and other 
measures. Those testifying at the hearing included the 
following VA witnesses: The Honorable Tim McClain, General 
Counsel; The Honorable Claude M. Kicklighter, Assistant 
Secretary for Policy and Planning and Acting Director, Office 
of Operations, Security and Preparedness; Frances M. Murphy, 
MD, Deputy Under Secretary for Health, Veterans Health 
Administration; Robert Epley, Associate Deputy Under Secretary 
for Policy and Program Management, Veterans Benefits 
Administration; John Thompson, Deputy General Counsel; and 
Vincent Barile, Deputy Under Secretary for Management, National 
Cemetery Administration. Also testifying were James Fischl, 
Director, National Veterans Affairs and Rehabilitation 
Commission, The American Legion; Joseph Violante, National 
Legislative Director, Disabled American Veterans; David Tucker, 
Associate Legislative Director, Paralyzed Veterans of America; 
and Dennis Cullinan, Director, National Legislative Service, 
Veterans of Foreign Wars.
    After carefully reviewing the testimony from the foregoing 
hearing, the Committee met in open session on June 6, 2002, and 
voted unanimously to report favorably S. 2132, with an 
amendment in the nature of a substitute incorporating 
provisions from S. 2132, S. 2186, and S. 2187. Present were 
Chairman Rockefeller, Ranking Member Specter, and Senators 
Jeffords, Wellstone, Murray, Miller, Nelson, Thurmond, 
Murkowski, Hutchinson, and Hutchison.

               Summary of the Committee Bill as Reported

    S. 2132 as reported (hereinafter, ``Committee bill'') 
contains various amendments to title 38 of United States Code 
and other freestanding provisions that would:
          (a) create four medical emergency preparedness 
        research and education centers within VHA to prepare 
        for the potential medical consequences of terrorism;
          (b) authorize an additional Assistant Secretary for 
        Operations, Preparedness, Security, and Law 
        Enforcement;
          (c) increase the number of authorized deputy 
        assistant secretaries from 18 to 20;
          (d) authorize VA to furnish medical care to any 
        individual affected by a major disaster or emergency 
        declared by the President under the Stafford Act, or by 
        a medical crisis that requires the activation of the 
        National Disaster Medical System;
          (e) permit VA to transfer appropriated research 
        funding to a VA nonprofit research corporation in order 
        to conduct research, training, or education;
          (f) allow VA to treat these nonprofit corporations as 
        affiliated institutions when negotiating the sharing of 
        health care resources for VA-approved projects;
          (g) allow employees of these nonprofit corporations 
        assigned to VA-approved projects to be considered VA 
        employees for the purposes of Federal Tort Claims Act 
        and medical malpractice coverage; and
          (h) permanently extend VA's authority to establish 
        nonprofit research and education corporations.

                             Committee Bill


                TITLE I: MEDICAL EMERGENCY PREPAREDNESS

    In 1982, Congress assigned a new responsibility to VA that 
built upon its three primary duties--caring for our nation's 
veterans, training health care personnel, and fostering 
scientific and clinical research to improve future medical 
care. Public Law 97-174 defined VA as the primary medical back-
up system to the Department of Defense during conflicts or 
domestic emergencies, and required that VA maintain a state of 
readiness to care for a large number of active duty military 
casualties with little notice.
    As Federal plans to protect public health during disasters 
have evolved over the last two decades, this ``Fourth Mission'' 
has grown to encompass more than just supporting the military 
during crises. Through the National Disaster Medical System--
formed as an interagency agreement by VA, the Federal Emergency 
Management Agency (hereinafter, ``FEMA''), the Department of 
Defense (hereinafter, ``DOD''), and the Department of Health 
and Human Services (hereinafter, ``HHS'') in 1984 and recently 
codified in Public Law 107-188--VA conducts training exercises 
and coordinates a network of Federal and community health care 
providers to prepare for domestic disasters. VA provides 
medical and logistical support through the Federal Response 
Plan for domestic disasters, developed according to the amended 
Robert T. Stafford Disaster Relief and Assistance Act, Public 
Law 93-288, and maintains a deployable Medical Emergency 
Radiological Response Team as part of the Federal Radiological 
Emergency Response Plan. Presidential Decision Directive 62 on 
combating terrorism (May 1998) tasked VA to provide medical 
support to HHS, including management of the National 
Pharmaceutical Stockpile.
    The assets that VA, the Nation's largest integrated health 
care system, brings to domestic emergency preparedness include 
its clinical infrastructure, its medical education programs, 
and its basic and clinical research programs. VA operates 
medical facilities in every State, the District of Columbia, 
and Puerto Rico, staffed by over 14,000 physicians and 37,000 
registered nurses. More than half of the physicians practicing 
in the United States received part of their professional 
education in the VA health care system through affiliations 
with 107 medical schools and more than 1,200 other schools 
across the country. VA's Medical and Prosthetic Research 
Program--which funded more than 15,000 projects last year--
includes large multi-center clinical trials, studies in 
clinical outcomes and health care delivery methods, 
rehabilitation development, and investigator-initiated research 
in areas that include mental illnesses, chronic disorders, 
aging, and the long-term consequences of exposures to chemical 
and biological hazards.
    The Committee strongly believes that these considerable 
resources should be efficiently incorporated into Federal 
strategies to protect the Nation during domestic disasters, 
including potential terrorist attacks. Through its geographic 
reach, education programs, and research capacity, VA stands 
ready to make a significant contribution to protecting veterans 
and the public from the medical consequences of a terrorist 
attack. At the same time, VA must receive the recognition and 
the resources necessary to accomplish its ``Fourth Mission'' 
without sacrificing its capacity to serve veterans and their 
families. The provisions incorporated in the Committee bill 
would create a new VA function within the nation's preparedness 
plans, strengthen VA's existing emergency response mission, and 
help VA preserve its ability to serve veterans during crises.

       SECTION 101: MEDICAL EMERGENCY PREPAREDNESS CENTERS IN VHA

Background

    The attacks of September 11th and the subsequent anthrax 
assaults on media and government figures demonstrated our 
national vulnerability to asymmetric warfare by terrorists 
willing to employ weapons of mass destruction against civilian 
targets. Fortunately, the anthrax exposures resulted in 
relatively few casualties. However, their aftermath illustrated 
vividly that the nation's public health and medical communities 
would be quickly overwhelmed in the face of a larger attack 
with biological, chemical, radiological, or even explosive or 
incendiary weapons. In addition, the anthrax incidents 
highlighted the dearth of knowledge regarding best medical 
practices--or even accurate diagnostic tools--to detect and 
cope with deliberately induced disease outbreaks.
    Although other research entities, such as the National 
Institutes of Health, also incorporate the talent and resources 
necessary to develop diagnostic, preventive, and therapeutic 
modes to counter the medical effects of biological or chemical 
attacks, VA possesses unparalleled strength in large-scale 
clinical management research. VA's Medical and Prosthetic 
Research Program has developed clinical practice models for 
many diseases, ranging from treatments for tuberculosis 
following World War II to a recently launched study to 
determine the best way to treat HIV/AIDS. Successful multi-
center VA clinical trials have yielded improved treatment for 
conditions that include schizophrenia, diabetes, cancer, 
depression, heart disease and stroke. VA's Centers of 
Excellence allow researchers from different disciplines to 
concentrate their research, education, and clinical programs on 
a single focus, such as hepatitis, geriatric medicine, mental 
illnesses, or Parkinson's disease.
    The military history of the last century has required VA to 
develop expertise in the consequences of exposure to 
radiological and chemical agents. In addition to long-standing 
research and clinical programs in these areas, Public Law 105-
368--passed subsequent to the Persian Gulf War--charged VA to 
investigate potential long-term health effects of biological 
and chemical warfare agents, including one-time and low-dose 
exposures. This program is currently divided between two VA 
research centers and an interagency collaboration with the 
Departments of Defense and Health and Human Services.
    VA demonstrated its ability to disseminate clinical 
information quickly after the September 11th attacks, using its 
powerful telemedicine network to bring a DOD-sponsored course 
on medical management of biological and chemical casualties to 
professionals throughout the VA healthcare system, and to its 
military and community partners. Three-quarters of VA 
researchers are practicing clinicians who can efficiently 
translate their research findings into general clinical 
practice through collaborations with researchers in other 
Federal agencies, academia, and the private sector.
    The medical emergency preparedness centers authorized by 
the Committee bill would build upon VA's expertise in both 
health care delivery and biological, chemical, and radiological 
exposures to ready VA health care professionals, and the 
medical community, for the potential medical consequences of a 
terrorist attack. Further, the centers would enable VA 
researchers to explore new technologies and medical 
applications that could be used to care for victims of such 
exposures, such as the use of umbilical cord stem cells to 
treat neural damage or the blood cell disorders that frequently 
occur in individuals exposed to large doses of radiation.
    Although VA might be able to identify enough established 
scientific programs at one site to constitute a single-field--
e.g., radiological response--center, the medical community 
generally accepts that strategies to manage mass casualties 
will most likely overlap and benefit from an all-hazards 
approach. As stated in a medical policy paper co-authored by 
VA's Deputy Under Secretary for Health:
          In order to combat acts of mass terror, contingency 
        planning has to involve more than just emergency 
        response. An effective strategy will have to consider a 
        broader array of immediate and long-term consequences, 
        which will arise regardless of the type of toxic 
        exposure or number of casualties.\1\
---------------------------------------------------------------------------
    \1\ Hyams, K.C., Murphy, F.M., and S. Wessely. (2002) Responding to 
Chemical, Biological, or Nuclear Terrorism: The Indirect and Long-Term 
Health Effects May Present the Greatest Challenge. Journal of Health 
Politics, Policy, and Law 27(2):273-291.
---------------------------------------------------------------------------
    As the Nation's public health and medical communities 
struggle with the dual problems of measuring and maintaining 
surge capacity, research into the best way to manage mass 
casualties is desperately needed. Regardless of the agency 
finally appointed to oversee homeland security research, the 
Committee expects that VA's valuable research and clinical 
resources will be integrated productively into national 
preparedness strategies.

Committee Bill

    Section 101 of the Committee bill is based on S. 2132 as 
introduced. This section would authorize VA to establish four 
centers for medical emergency preparedness research, training, 
and clinical activities. These centers would develop strategies 
to detect, diagnose, prevent, and treat the injuries or 
illnesses that could arise from a terrorist attack with 
chemical, biological, radiological, incendiary, or other 
explosive weapons.
    Section 101 would direct the Secretary to select sites for 
centers through a peer-reviewed competitive process open to VA 
medical centers affiliated with at least one accredited school 
of medicine, school of public health, and graduate program in 
epidemiology, in order to select sites with considerable 
resident expertise and potential to train health care 
professionals. The Committee bill does not limit each center to 
a specific topic of study (e.g., radiological incidents), but 
leaves the appropriate mix of research in this new and 
interdisciplinary field of medical preparedness to VA, peer 
reviewers, and researchers.
    Section 101 would direct that techniques or practices 
identified at these centers be used to educate and train health 
care professionals within VHA. Section 101 would also allow VA 
to extend these training activities, at the direction of the 
Secretary and through interagency agreements such as the 
National Disaster Medical System, to non-VA care providers.
    Section 101 would also authorize VA to offer laboratory, 
epidemiological, medical, or other appropriate assistance to 
other agencies--whether Federal, State, or local--that request 
assistance during a medical emergency. This mission is 
consistent with VA's current role as a support agency to the 
Federal response to disasters, and would still allow individual 
VA medical centers to respond to local disasters as an integral 
part of the communities they serve.
    The Committee bill would require that research and response 
activities undertaken under this section be compatible with 
research strategies coordinated by the Office of Homeland 
Security (or equivalent agency) and similar research undertaken 
by the Departments of Defense and Health and Human Services.
    Cost: CBO estimates that enacting this provision would 
increase spending by $12 million in 2003 and by $87 million 
over the 2003-2007 period.

SECTION 201: AUTHORIZED FUNCTIONS OF ASSISTANT SECRETARIES FOR VETERANS 
                                AFFAIRS

Background

    In the wake of the September 11th terrorist attacks, senior 
staff representing VA's three administrations and other major 
offices identified a pressing need for a single office within 
VA headquarters to coordinate all preparedness and Federal 
response activities.
    On October 26, 2001, the Secretary authorized assignment of 
detailed employees from other VA offices to an office charged 
with ensuring department-wide operational readiness. VA then 
requested authorization of a new office to carry out 
operations, preparedness, security, and law enforcement 
functions on a dedicated basis. This new office would be 
directed by an Assistant Secretary responsible for providing 
appropriate executive leadership and accountability, and for 
representing VA in interagency homeland security planning 
efforts.
    The Committee intends that the new Assistant Secretary of 
Operations, Preparedness, and Security would coordinate 
department-wide planning, training, and exercises to ensure 
that VA can effectively serve veterans during emergencies. 
Critical tasks would include planning to protect veterans and 
staff within VA facilities, integrating emergency preparedness 
and consequence management strategies within VA, and developing 
and maintaining effective relationships with other agencies 
responsible for homeland security. This office should build 
upon, rather than supplant, existing medical preparedness 
programs within VA.

Committee Bill

    Section 201 would increase the number of authorized VA 
assistant secretaries from six to seven, and expand authorized 
functions to include operations, preparedness, security, and 
law enforcement.
    Cost: CBO did not estimate any cost to be associated with 
section 201.

   SECTION 202: ADDITIONAL DEPUTY ASSISTANT SECRETARIES FOR VETERANS 
                                AFFAIRS

Background

    VA's internal assessment of its readiness to respond to 
disasters and the experience of staff responsible for emergency 
preparedness have established the need for an office dedicated 
to preparedness activities, as described in Section 201. In 
order to provide appropriate executive level assistance, the 
Committee bill would authorize two new deputy assistant 
secretaries for this office. To the existing Deputy Assistant 
Secretary for Security and Law Enforcement, whose authorities 
will be transferred to the new office, Section 202 would 
authorize VA to add a Principal Deputy Assistant Secretary to 
support the Assistant Secretary and a Deputy Assistant 
Secretary to assist in contingency and mass care planning.

Committee Bill

    Section 202 would increase the number of authorized deputy 
assistant secretaries from 18 to 20.
    Cost: CBO did not estimate any cost to be associated with 
section 202.

  SECTION 301: AUTHORITY TO FURNISH HEALTH CARE DURING MAJOR DISASTERS

Background

    The Federal Response Plan for domestic disasters outlines 
specific ``emergency support functions'' that may be required 
during and following a national emergency and assigns primary 
responsibility for each of these functions to a specific agency 
or entity. VA's tasks under this plan include supporting 
several emergency functions, most significantly Emergency 
Support Function #8 (ESF #8), the Health and Medical Services 
Annex. Under this plan, HHS ``coordinates the provision of 
Federal health and medical assistance to fulfill the 
requirements identified by the affected State and local 
authorities having jurisdiction. Included in ESF #8 are overall 
public health response; triage, treatment, and transportation 
of victims of the disaster; and evacuation of patients out of 
the disaster area, as needed, into a network of Military 
Services, Veterans Affairs, and pre-enrolled non-Federal 
hospitals located in the major metropolitan areas of the United 
States.''
    This plan gives HHS authority to call upon VA for 
assistance directly following a Presidentially declared 
emergency or major disaster, or after activation of the 
National Disaster Medical System (hereinafter, ``NDMS''), a 
network of Federal and non-Federal care providers. VA has 
responded quickly when called, working within the NDMS to 
provide care and supplies during every major domestic disaster 
of the last two decades, including in New York and at the 
Pentagon following the September 11th attacks.
    VA's NDMS obligations were undertaken subsequent to its 
assignment as primary contingency medical back-up system to the 
military in Public Law 97-174. Under 38 U.S.C. Sec. 1784, the 
Secretary is authorized to ``furnish hospital care or medical 
services as a humanitarian service in emergency cases, but the 
Secretary shall charge for such care and services at rates 
prescribed by the Secretary.'' Neither of these authorities 
acknowledges VA's considerable commitment and obligation to 
providing emergency care and support to the public as part of 
its Federal response plan duties, which may be expected to 
escalate in light of the Nation's increasing commitment to 
homeland security.
    In addition to the role VA fills as a Federal resource 
during disasters, VA medical centers contribute to disaster 
management within their communities. Even before September 
11th, more than 80 percent of VA medical centers had been 
included in local community emergency response plans. At the 
Committee's May 2, 2002, hearing on pending legislation, Deputy 
Under Secretary for Health Murphy stated:
          I would just add that one of the misperceptions is 
        that because we are a Federal agency and an executive 
        branch department, that we are not part of the local 
        communities. In fact, VA is different than many of the 
        departments, in that we are integrated into every city, 
        every community in the country, and VA needs to be 
        there to be part of that Federal public health 
        infrastructure, and we can play a very valuable role if 
        we are given the mission to do so.
    The dual obligation of VA's medical facilities--serving 
collectively as the major pre-deployed Federal clinical 
resource and individually as an integral part of the 
communities in which they are placed--demands appropriate 
authority not now explicit in law.

Committee Bill

    Section 301 authorizes VA to extend medical services to 
individuals affected by a Presidentially declared major 
disaster or a public health emergency in which the National 
Disaster Medical System is activated. VA would be authorized to 
offer care at VA medical facilities, including hospital 
treatment, to veterans (regardless of enrollment status), 
active duty military personnel, local and community emergency 
response providers, or other individuals responding to or 
involved in the disaster. Veterans with service-connected 
disabilities would retain the highest priority for care and 
services, followed by active duty military casualties during 
activation of the VA/DOD contingency medical system, after 
which VA could grant the next level of priority to individuals 
affected by a disaster.
    This section would also allow VA to receive reimbursement 
for the cost of services provided to employees of other Federal 
agencies or departments, to be credited to the facility that 
provided care. VA would not be required to charge other 
individuals for emergency care offered during a disaster.
    Cost: CBO was unable to provide a cost estimate associated 
with section 301.

                SECTIONS 401-403: RESEARCH CORPORATIONS

Background

    VA-affiliated nonprofit research and education corporations 
(hereinafter, ``NPCs'') were established under 38 U.S.C. 
Sec. Sec. 7361-7368 to facilitate VA's research and education 
missions. In 2001, non-profit corporations at 84 VA medical 
centers (hereinafter, ``VAMCs'') reported previous-year 
revenues of nearly $174 million. These revenues would never 
have been available to VA without the special rules under which 
these corporations operate.
    Currently, VAMCs are prohibited from entering into 
contracts, or other agreements involving payments, with their 
affiliated NPCs. Further, a 1989 VA Office of General Counsel 
opinion ruled that VAMCs and NPCs may not enter into sharing 
agreements. However, two later opinions, dated April 4, 1990, 
and February 16, 1996, concluded that agreements were 
permissible. The result of this web of conflicting legal 
opinions and statutory prohibitions is that VAMCs cannot 
acquire services that they may need from the NPCs, even when it 
could be cost-effective and efficient to do so.
    Several VA researchers described examples of possible VA-
NPC contracting opportunities to the Committee. In one example, 
a project funded through a VA merit review award in VISN 3 
required patients to travel long distances to the VAMC to 
participate in the study. The grant included funding for such 
travel; however, the principal investigator lacked the staff 
and the expertise to provide for such travel arrangements. 
Hence, the investigator sought to enter into a contract with 
the affiliated NPC to make all the necessary arrangements. This 
arrangement, however, was prohibited. Other examples 
highlighted the benefits for VA researchers to contract with 
NPCs for conference management; technical services; use of 
expensive, high-tech equipment; and organization of training 
programs.
    VA's inability to contract with NPCs is not the only 
limitation under the current statutory scheme. A recent legal 
interpretation by the Department of Justice determined that 
certain employees of NPCs are not covered under the Federal 
Tort Claims Act (hereinafter, ``FTCA''). The opinion noted that 
physicians employed by the VA-affiliated NPCs cannot be 
considered Federal employees for purposes of FTCA even though 
they have VA ``without compensation'' (WOC) appointments. Prior 
to this opinion, the common understanding had been that 
corporation employees were covered by FTCA, subject to the 
Attorney General's certification that their work was within the 
scope of government employment. In order to assure such 
certification, NPC employees have been required to have VA WOC 
appointments, to work only on VA-approved research and 
education, and to work under the supervision of VA personnel.
    On October 15, 2001, the VA Office of General Counsel 
requested reconsideration of the conclusion reached by the 
Department of Justice in its March 29, 2000, letter. However, 
the Committee understands that such a reconsideration, if it is 
granted at all, might take up to four years to be resolved. In 
the meantime, NPC physicians, nurses, technicians, and allied 
health care professionals are personally liable for suits 
alleging negligence or malpractice while working on VA-approved 
research.
    Authority for VA to establish nonprofit research and 
education corporations expires on December 31, 2003.

Committee Bill

    Section 401 of the Committee bill clarifies that VA medical 
centers may use VA's existing contracting authorities to 
acquire research or education services from NPCs. In testimony 
before the Committee on May 2, 2002, VA General Counsel Tim 
McClain objected to these clarifications on ``the grounds that 
they would alter the fundamental nature of the relationship 
between VA and the non-profits, which is analogous to that 
created in a trust.'' While the Committee agrees that the 
relationship between NPCs and VAMCs would change, the Committee 
believes such changed would be for the better--the NPCs will be 
able to do more for VA, not less, and only after potential 
agreements are approved by VA. As a result, VA will retain full 
responsibility for the conduct of NPC research assistance.
    Section 402 provides FTCA coverage for certain employees of 
VA-affiliated NPCs. Since 1989, both VA and the NPCs have 
operated under the belief that corporation employees with WOC 
appointments, working on VA-approved research under the 
supervision of VA employees, would be covered under FTCA. While 
no negligence or malpractice suits have been filed against a 
corporation employee, prudence dictates that these employees 
with VA appointments be covered by the FTCA. VA strongly 
supports this provision.
    Section 403 permanently extends the authority to establish 
nonprofit VA research and education corporations.
    Cost: CBO did not estimate any cost to be associated with 
sections 401-403.

                             Agency Report

    On May 2, 2002, the Honorable Tim McClain, General Counsel, 
Department of Veterans Affairs, appeared before the Committee 
and submitted testimony on, among other things, S. 2132, S. 
2186, and S. 2187. Excerpts from this statement are reprinted 
below:

   STATEMENT OF TIM McCLAIN, GENERAL COUNSEL, DEPARTMENT OF VETERANS 
                                AFFAIRS

    Mr. Chairman and Members of the Committee, Thank you for 
the opportunity to testify on a number of legislative items of 
interest to veterans.

           *       *       *       *       *       *       *


                                S. 2132

    Section 1 of S. 2132 would require the Secretary to 
establish four Emergency Medical Preparedness Centers within 
the Veterans Health Administration (VHA). VA employees would 
staff the proposed Centers, and the Centers would be 
administered jointly by the offices within the Department that 
are responsible for directing research and for directing 
medical emergency preparedness.
    The Centers would have four specific purposes. First, they 
would carry out research and develop methods in detection, 
diagnosis, vaccination, protection, and treatment of injuries 
arising from the use of chemical, biological, radiological 
agents or incendiary or other explosive weapons or devices. 
Second, they would provide education, training, and advice on 
the medical consequences of the use of CBR agents or incendiary 
or other explosive weapons or devices. Third, the Centers would 
provide that same education, training, and advice to non-VA 
health-care professionals. These activities would be 
accomplished through either the National Disaster Medical 
System or interagency agreements. Fourth, in the event of a 
national emergency, they would provide laboratory, 
epidemiological, medical, or other assistance, as the Secretary 
considers appropriate, to Federal, State, and local health care 
agencies and personnel involved in, or responding to, the 
national emergency.
    Each Center would be authorized to solicit and accept 
contributions of funds and other resources, including grants, 
to carry out their purposes and activities, subject to the 
Secretary's approval. Section 1 of this bill would also 
authorize to be appropriated $20 million for these Centers for 
each of fiscal years 2003 through 2007. By the bill's terms, 
such authorization is valid only for funds appropriated 
separately and solely for purposes of the Centers; otherwise, 
the authorization is null and void.
    Section 1 of S. 2132 is similar to H.R. 3253 on which the 
Deputy Secretary testified on April 10, 2002, before the House 
Committee on Veterans' Affairs, Subcommittee on Health. 
However, it incorporates the recommendations VA suggested in 
its April testimony concerning H.R. 3253 and adds a number of 
improvements to the House version of the bill. We are grateful 
to this Committee for having incorporated our recommendations. 
We strongly support the goals of section 1 of S. 2132 and 
prefer it to H.R. 3253. However, the Executive Office of the 
President, through the Homeland Security Council (HSC), is 
currently crafting a comprehensive coordinated Federal policy 
on Homeland Security. VA is actively participating in this HSC 
effort. It is expected that HSC will deliver this policy to the 
President this July. The precise roles and responsibilities VA 
will be assigned in the area of Homeland Security will be 
reflected in that policy. We expect that we will have much to 
contribute in this area based on our depth of expertise and 
infrastructure, as alluded to above.
    Because the President's Homeland Security Policy is 
forthcoming, we would like to work with the Committee to ensure 
that section 1 of S. 2132 is consistent with the comprehensive 
Federal plan.
    In addition, S. 2132 contains two provisions that would 
expand the purpose and operations of VA non-profit 
corporations. VA non-profit corporations function as flexible 
funding mechanisms that support VA research and education. VA 
non-profits receive and administer funds from outside sources, 
e.g., NIH grants and donations made by private sponsors, in 
support of approved VA research projects and education 
activities. However, the current statute expressly provides 
that VA may not transfer appropriated funds to the 
corporations. Section 2(a) of the bill would amend section 7362 
of title 38 to permit the transfer of appropriated dollars from 
VA to a corporation pursuant to a contract or other agreement, 
including an agreement for actual research. In addition, 
section 2(b) of the bill would amend VA's sharing authority to 
treat VA non-profits like affiliated institutions for the 
purpose of sharing health-care resources related to research, 
education and training. These changes would broadly enable the 
corporations to sell services to the Department. The bill also 
provides that these arrangements would be outside the scope of 
Federal procurement law and, therefore, would not be subject to 
full and open competition.
    VA objects to these proposals on the grounds that they 
would alter the fundamental nature of the relationship between 
VA and the non-profits, which is analogous to that created in a 
trust. Under current law the corporations exist as a flexible 
funding mechanism solely to support approved VA research and 
education. The amendments in section 2 of the bill would make 
the relationship between Department health-care facilities and 
VA non-profits more like that with outside contractors or 
university affiliates; more of an arms-length negotiation 
rather than one of incontrovertible fiduciary support. This 
change would also shift the emphasis of VA non-profits away 
from the primary focus of providing flexible funding support 
for VA research, education and training to conducting and 
selling these services to VA. This shift would present a 
troubling risk of ceding Department control of VA approved 
research or education to the non-profits.
    Section 3 of the bill would amend the title 38 authorities 
related to VA non-profits by adding a new section 7364A to 
specifically state that corporation employees assigned to work 
on approved VA research or education and training shall be 
considered employees for purposes of Federal tort claim and 
medical malpractice coverage. VA strongly favors this 
provision. We note, however, that the phrase, ``carried out 
with Department funds'' in the proposed section 7364A(b)(2) 
might be interpreted to limit this coverage. Much of VA-
approved research, or education and training is supported by 
external funds.

                                S. 2186

    Mr. Chairman, thank you for introducing S. 2186 at our 
request. This legislation would establish a new Assistant 
Secretary to perform operations, preparedness, security and law 
enforcement and a new VA office of Operations Security and 
Preparedness. We believe this new office is essential if we are 
to meet our responsibilities of protecting veterans, employees, 
and visitors to our facilities.

                                S. 2187

    S. 2187 would permit VA, on its own initiative, to care for 
those affected by a disaster or emergency and those responding 
to the emergency. The disaster or emergency must be either 
declared by the President or involve activation of the National 
Defense Medical System. The bill would also require other 
Federal agencies to reimburse VA for care provided to their 
officers, employees, and active duty members at rates agreed 
upon by the agencies. VA would not be required to charge for 
care provided to other individuals. Finally, the bill would 
allow VA to provide care in response to disasters and emergency 
situations before caring for all other beneficiaries except 
service-connected veterans and active duty military members 
referred during war or national emergency or who are responding 
or involved in a disaster or emergency.
    We are very interested in this measure, but we need to work 
with both the committee and other Federal departments and 
agencies to fully understand the implications of the bill. We 
anticipate providing further views on the measure at a later 
time. We would note, however, that the bill also proposes to 
amend 38 U.S.C. Sec. 1711(b). That provision is now codified at 
38 U.S.C. Sec. 1784. Finally, the bill would conflict with an 
administrative provision that appears in VA's annual 
appropriation act that requires reimbursement of costs except 
in specified situations. For the provision to be effective that 
provision of the appropriations act will also need amendment.

               Congressional Budget Office Cost Estimate

                                     U.S. Congress,
                               Congressional Budget Office,
                                     Washington, DC, June 13, 2002.
Hon. John D. Rockefeller IV,
Chairman, Committee on Veterans' Affairs,
U.S. Senate, Washington, DC.
    Dear Mr. Chairman: The Congressional Budget Office has 
prepared the enclosed cost estimate for S. 2132, the Department 
of Veterans Affairs Emergency Preparedness Act of 2002.
    If you wish further details on this estimate, we will be 
pleased to provide them. The CBO staff contact is Sam 
Papenfuss.
            Sincerely,
                                         Barry B. Anderson,
                                      for Dan L. Crippen, Director.
    Enclosure.

 S. 2132, Department of Veterans Affairs Emergency Preparedness Act of 
                                  2002


                                SUMMARY

    S. 2132 would establish four centers for medical emergency 
preparedness that would carry out research and development, 
provide education and training, and provide assistance in the 
case of a national emergency with regard to chemical, 
biological, radiological, incendiary or other explosive weapons 
threats. These emergency centers would be located in hospitals 
operated by the Department of Veterans Affairs (VA). S. 2132 
would authorize appropriations of $20 million a year over the 
2003-2007 period to operate the centers. S. 2132 also would 
allow VA to provide medical care to individuals who are 
affected by a major disaster or emergency.
    In addition, S. 2132 would increase the number of assistant 
secretaries within the VA from six to seven with the new 
assistant secretary being responsible for operations, 
preparedness, security, and law enforcement functions. The bill 
also would increase the number of deputy assistant secretaries 
within VA from 18 to 20. Finally, S. 2132 would allow research 
corporations established under current law by the Secretary of 
VA to use appropriated funds to conduct their research and 
would consider some employees of those research corporations to 
be employees of the federal government for purposes of certain 
federal tort claims laws.
    CBO estimates that implementing S. 2132 would cost $12 
million in 2003 and $87 million over the 2003-2007 period, 
assuming appropriation of the authorized amounts, for 
establishing and operating the new emergency centers. CBO 
cannot estimate the potential additional discretionary spending 
that could occur under S. 2132 for providing VA medical care to 
individuals needing assistance in a national emergency. CBO 
also expects that enacting this bill could increase direct 
spending for settlement of tort claims over the 2003-2012 
period but we cannot provide a specific estimate. Because the 
bill could affect direct spending, pay-as-you-go procedures 
would apply.
    S. 2132 contains no intergovernmental or private-sector 
mandates as defined in the Unfunded Mandates Reform Act (UMRA) 
and would impose no costs on state, local, or tribal 
governments.

                ESTIMATED COST TO THE FEDERAL GOVERNMENT

    The estimated budgetary impact of S. 2132 is shown in the 
following table. The costs of this legislation fall within 
budget functions 700 (veterans benefits and services) and 800 
(general government).

            Changes in Spending Subject to Appropriation a, b
                  [By Fiscal Year, in Millions Dollars]
------------------------------------------------------------------------
                                   2003    2004    2005    2006    2002
------------------------------------------------------------------------
Spending for VA Emergency
 Preparedness Centers Under S.
 2132:
  Authorization Level...........      20      20      20      20      20
  Estimated Outlays.............      12      16      19      20      20
------------------------------------------------------------------------
a No funds were appropriated for these purposes in 2002.
b In addition to the bill's impact on discretionary spending, CBO
  estimates that S. 2132 could increase direct spending for settlement
  of tort claims over the 2003-2012 period but is unable to provide a
  specific estimate given the uncertain events and the nature of these
  claims.

                           BASIS OF ESTIMATE

    For this estimate, CBO assumes that the bill will be 
enacted by October 1, 2002, and that the authorized amounts 
will be appropriated for each year. In addition to the bill's 
discretionary cost, enacting S. 2132 could affect direct 
spending; but CBO cannot estimate those potential effects, if 
any.

Spending Subject to Appropriation

    Emergency Preparedness Centers. VA has some limited 
responsibilities to provide assistance in the event of a 
chemical, biological, radiological, incendiary or other 
explosive weapons threat under current law. Under section 101, 
VA would have expanded responsibility to assist with these 
threats with the creation of four medical emergency 
preparedness centers that would carry out VA's 
responsibilities. S. 2132 would specifically authorize 
appropriations of $20 million a year over the 2003-2007 period 
for the operation of these centers. Assuming normal delays in 
beginning new programs and appropriation of the authorized 
amounts, CBO estimates that implementing S. 2132 would increase 
spending by $12 million in 2003 and by $87 million over the 
2003-2007 period.
    The bill would require VA to establish four centers for 
medical emergency preparedness that would have three different 
responsibilities. The first would be to conduct research and 
development on detection, diagnosis, protection, and treatment 
for the specified threats to the public health and safety. The 
second responsibility would be to provide training and advice 
to health care professionals outside of VA with regard to these 
threats. The third responsibility would be to provide 
contingent rapid response assistance including laboratory 
assistance in the event of national emergencies.
    Assistance in a National Emergency. Section 301 would allow 
VA to provide medical care to individuals needing assistance, 
regardless of their VA enrollment status, in the event of a 
major disaster or medical emergency. Depending on the scope of 
the assistance provided in response to a major disaster or 
emergency, CBO believes that implementing this provision could 
prove costly. CBO cannot estimate the cost of implementing this 
provision, however, because we cannot predict the frequency or 
seriousness of national emergencies, nor the extent to which VA 
assistance would be used in any such emergency.

Direct Spending

    Under current law, there is a question whether or not 
employees of research corporations established by the VA who do 
research are considered employees of the federal government for 
purposes of certain federal tort claims laws. Section 402 would 
resolve this question by specifying that these employees would 
be considered federal employees for purposes of tort claims. 
Consequently, any judgments against these employees would be 
paid by the federal government. The allowable tort claims are 
for injury, loss of property, personal injury, or death caused 
by negligence, wrongful acts, or omissions by a federal 
employee acting within the scope of the employee's office or 
employment. Those payments would be considered direct spending.
    If these employees are, on the one hand, already covered 
under the relevant federal tort claims laws, then this section 
would have no cost. If, on the other hand, these employees are 
not covered under the relevant tort claims laws, then the 
federal government would face a potential increase in its 
liability under these laws upon enactment of this bill. Given 
the uncertainty surrounding future events and the nature of 
tort claims, CBO cannot estimate the cost--if any--of future 
tort claims against the federal government.

                      PAY-AS-YOU-GO CONSIDERATIONS

    The Balanced Budget and Emergency Deficit Control Act sets 
up pay-as-you-go procedures for legislation affecting direct 
spending or receipts. CBO estimates that enacting this bill 
could increase direct spending for settlement of tort claims, 
but we cannot provide a specific estimate.

              INTERGOVERNMENTAL AND PRIVATE-SECTOR IMPACT

    S. 2132 contains no intergovernmental or private-sector 
mandates as defined in UMRA and would impose no costs on state, 
local, or tribal governments.

                         PREVIOUS CBO ESTIMATE

    On May 10, 2002, CBO transmitted a cost estimate for H.R. 
3253, the Department of Veterans Affairs Emergency Preparedness 
Research, Education, and Bio-Terrorism Prevention Act of 2002, 
as ordered reported by the House Committee on Veterans' Affairs 
on May 9, 2002. H.R. 3253 and S. 2132 would both establish four 
centers for medical emergency preparedness and authorize $20 
million a year over the 2003-2007 period to operate those 
centers. Both bills would increase the number of VA assistant 
secretaries from six to seven, but only S. 2132 would increase 
the number of deputy assistant secretaries from 18 to 20. 
Finally, S. 2132 contains provisions affecting research 
corporations established by VA and assistance in a national 
emergency, while H.R. 3253 does not.
    Estimate prepared by: Federal Costs: Sam Papenfuss; Impact 
on State, Local, and Tribal Governments: Elyse Goldman; Impact 
on the Private Sector: Sally S. Maxwell.
    Estimate approved by: Peter H. Fontaine, Deputy Assistant 
Director for Budget Analysis.

    Changes in Existing Law Made by the Committee Bill, As Reported

    In compliance with rule XXVI paragraph 12 of the Standing 
Rules of the Senate, the following provides a print of the 
statute or the part or section thereof to be amended or 
replaced (existing law proposed to be omitted is enclosed in 
black brackets, new matter is printed in italic, existing law 
in which no change is proposed is shown in roman):

TITLE 38, UNITED STATES CODE

           *       *       *       *       *       *       *


Sec. 308. Assistant Secretaries; Deputy Assistant Secretaries

  (a) There shall be in the Department not more than [six] 
seven Assistant Secretaries. Each Assistant Secretary shall be 
appointed by the President, by and with the advice and consent 
of the Senate.
  (b) The Secretary shall assign to the Assistant Secretaries 
responsibility for the administration of such functions and 
duties as the Secretary considers appropriate, including the 
following functions:

           *       *       *       *       *       *       *

          (11) Operations, preparedness, security, and law 
        enforcement functions.

           *       *       *       *       *       *       *

  (d)(1) There shall be in the Department such number of Deputy 
Assistant Secretaries, not exceeding [18] 20, as the Secretary 
may determine. Each Deputy Assistant Secretary shall be 
appointed by the Secretary and shall perform such functions as 
the Secretary prescribes.

           *       *       *       *       *       *       *


           *       *       *       *       *       *       *


1785. CARE AND SERVICES DURING MAJOR DISASTERS AND MEDICAL EMERGENCIES.

Sec. 1784. Humanitarian care

  The Secretary may furnish hospital care or medical services 
as a humanitarian service in emergency cases, but , except as 
provided in section 1785 of this title with respect to a 
disaster or emergency covered by that section, the Secretary 
shall charge for such care and services at rates prescribed by 
the Secretary.

           *       *       *       *       *       *       *


CHAPTER 11--COMPENSATION FOR SERVICE-CONNECTED DISABILITY OR DEATH???

           *       *       *       *       *       *       *


SUBCHAPTER II--WARTIME DISABILITY COMPENSATION????

           *       *       *       *       *       *       *


 CHAPTER 11--COMPENSATION FOR SERVICE-CONNECTED DISABILITY OR DEATH???

                        subchapter i--general???

Sec.

           *       *       *       *       *       *       *


subchapter ii--wartime disability compensation

           *       *       *       *       *       *       *


7320A. MEDICAL EMERGENCY PREPAREDNESS CENTERS.

           *       *       *       *       *       *       *


Sec. 7320A. Medical emergency preparedness centers

  (a) The Secretary shall establish and maintain within the 
Veterans Health Administration four centers for research and 
activities on medical emergency preparedness.
  (b) The purposes of each center established under subsection 
(a) shall be as follows:
          (1) To carry out research on the detection, 
        diagnosis, prevention, and treatment of injuries, 
        diseases, and illnesses arising from the use of 
        chemical, biological, radiological, or incendiary or 
        other explosive weapons or devices, including the 
        development of methods for the detection, diagnosis, 
        prevention, and treatment of such injuries, diseases, 
        and illnesses.
          (2) To provide to health-care professionals in the 
        Veterans Health Administration education, training, and 
        advice on the treatment of the medical consequences of 
        the use of chemical, biological, radiological, or 
        incendiary or other explosive weapons or devices.
          (3) Upon the direction of the Secretary, to provide 
        education, training, and advice described in paragraph 
        (2) to health-care professionals outside the Department 
        through the National Disaster Medical System or through 
        interagency agreements entered into by the Secretary 
        for that purpose.
          (4) In the event of a national emergency, to provide 
        such laboratory, epidemiological, medical, or other 
        assistance as the Secretary considers appropriate to 
        Federal, State, and local health care agencies and 
        personnel involved in or responding to the national 
        emergency.
  (c)(1) Each center established under subsection (a) shall be 
established at an existing Department medical center, whether 
at the Department medical center alone or at a Department 
medical center acting as part of a consortium of Department 
medical centers for purposes of this section.
  (2) The Secretary shall select the sites for the centers from 
among competitive proposals that are submitted by Department 
medical centers seeking to be sites for such centers.
  (3) The Secretary may not select a Department medical center 
as the site of a center unless the proposal of the Department 
medical center under paragraph (2) provides for--
          (A) an arrangement with an accredited affiliated 
        medical school and an accredited affiliated school of 
        public health (or a consortium of such schools) under 
        which physicians and other health care personnel of 
        such schools receive education and training through the 
        Department medical center;
          (B) an arrangement with an accredited graduate 
        program of epidemiology under which students of the 
        program receive education and training in epidemiology 
        through the Department medical center; and
          (C) the capability to attract scientists who have 
        made significant contributions to innovative approaches 
        to the detection, diagnosis, prevention, and treatment 
        of injuries, diseases, and illnesses arising from the 
        use of chemical, biological, radiological, or 
        incendiary or other explosive weapons or devices.
  (4) In selecting sites for the centers, the Secretary shall--
          (A) utilize a peer review panel (consisting of 
        members with appropriate scientific and clinical 
        expertise) to evaluate proposals submitted under 
        paragraph (2) for scientific and clinical merit; and
          (B) to the maximum extent practicable, ensure the 
        geographic dispersal of the sites throughout the United 
        States.
  (d)(1) Each center established under subsection (a) shall be 
administered jointly by the offices within the Department that 
are responsible for directing research and for directing 
medical emergency preparedness.
  (2) The Secretary and the heads of the agencies concerned 
shall take appropriate actions to ensure that the work of each 
center is carried out--
          (A) in close coordination with the Department of 
        Defense, Department of Health and Human Services, 
        Office of Homeland Security, and other departments, 
        agencies, and elements of the Federal Government 
        charged with coordination of plans for United States 
        homeland security; and
          (B) in accordance with any applicable recommendations 
        of the Working Group on Bioterrorism and Other Public 
        Health Emergencies, or any other joint interagency 
        advisory groups or committees designated to coordinate 
        Federal research on weapons of mass destruction.
  (e)(1) Each center established under subsection (a) shall be 
staffed by officers and employees of the Department.
  (2) Subject to the approval of the head of the department or 
agency concerned and the Director of the Office of Personnel 
Management, an officer or employee of another department or 
agency of the Federal Government may be detailed to a center if 
the detail will assist the center in carrying out activities 
under this section. Any detail under this paragraph shall be on 
a non-reimbursable basis.
  (f) In addition to any other activities under this section, a 
center established under subsection (a) may, upon the request 
of the agency concerned and with the approval of the Secretary, 
provide assistance to Federal, State, and local agencies 
(including criminal and civil investigative agencies) engaged 
in investigations or inquiries intended to protect the public 
safety or health or otherwise obviate threats of the use of a 
chemical, biological, radiological, or incendiary or other 
explosive weapon or device.
  (g) Notwithstanding any other provision of law, each center 
established under subsection (a) may, with the approval of the 
Secretary, solicit and accept contributions of funds and other 
resources, including grants, for purposes of the activities of 
such center under this section.

           *       *       *       *       *       *       *


Sec. 7362. Purpose of corporations

  (a) Any corporation established under this subchapter shall 
be established solely to facilitate research as described in 
section 7303(a) of this title and education and training as 
described in sections 7302, 7471, 8154, and 1701(6)(B) of this 
title in conjunction with the applicable Department medical 
center. [Any funds received by the Secretary for the conduct of 
research or education at the medical center other than funds 
appropriated to the Department may be transferred to and 
administered by the corporation for these purposes.]
  (b)(1) Any funds, other than funds appropriated for the 
Department, that are received by the Secretary for the conduct 
of research or education and training may be transferred to and 
administered by a corporation established under this subchapter 
for the purposes set forth in subsection (a).
  (2) Funds appropriated for the Department are available for 
the conduct of research or education and training by a 
corporation, but only pursuant to the terms of a contract or 
other agreement between the Department and such corporation 
that is entered into in accordance with applicable law and 
regulations.
  (3) A contract or agreement executed pursuant to paragraph 
(2) or section 8153 of this title may facilitate only research 
or education and training described in subsection (a). Such 
contract or agreement may not be executed for the provision of 
a health-care resource unless such health-care resource is 
related to such research or education and training.
  [(b)] (c) For purposes of this section, the term ``education 
and training'' means the following:

           *       *       *       *       *       *       *


Sec. 8111A. Furnishing of health-care services to members of the Armed 
                    Forces during a war or national emergency

  [(a)(1) During and immediately following a period of war, or 
a period of national emergency declared by the President or the 
Congress that involves the use of the Armed Forces in armed 
conflict, the Secretary may furnish hospital care, nursing home 
care, and medical services to members of the Armed Forces on 
active duty. The Secretary may give a higher priority to the 
furnishing of care and services under this section than to the 
furnishing of care and services to any other group of persons 
eligible for care and services in medical facilities of the 
Department with the exception of veterans with service-
connected disabilities.]
  [(2) For the purposes of this section, the terms ``hospital 
care'', ``nursing home care'', and ``medical services'' have 
the meanings given such terms by sections 1701(5), 101(28), and 
1701(6) of this title, respectively, and the term ``medical 
services'' includes services under sections 1782 and 1783 of 
this title.]
  (a)(1) During and immediately following a period of war, or a 
period of national emergency declared by the President or 
Congress that involves the use of the Armed Forces in armed 
conflict, the Secretary may furnish hospital care, nursing home 
care, and medical services to members of the Armed Forces on 
active duty.
  (2)(A) During and immediately following a disaster or 
emergency referred to in subparagraph (B), the Secretary may 
furnish hospital care and medical services to members of the 
Armed Forces on active duty responding to or involved in such 
disaster or emergency, as the case may be.
  (B) A disaster or emergency referred to in this subparagraph 
is any disaster or emergency follows:
          (i) A major disaster or emergency declared by the 
        President under the Robert B. Stafford Disaster Relief 
        and Emergency Assistance Act (42 U.S.C. 5121 et seq.).
          (ii) A disaster or emergency in which the National 
        Disaster Medical System is activated.
  (3) The Secretary may give a higher priority to the 
furnishing of care and services under this section than to the 
furnishing of care and services to any other group of persons 
eligible for care and services in medical facilities of the 
Department with the exception of veterans with service-
connected disabilities.
  (4) In this section, the terms ``hospital care'', ``nursing 
home care'', and ``medical services'' have the meanings given 
such terms by sections 1701(5), 101(28), and 1701(6) of this 
title, respectively.

           *       *       *       *       *       *       *


Sec. 8153. Sharing of health-care resources

  (a)(1) * * *

           *       *       *       *       *       *       *

  (3)(A) * * *

           *       *       *       *       *       *       *

  (C) If the resource required is research or education and 
training (as that term is defined in section 7362(c) of this 
title) and is to be acquired from a corporation established 
under subchapter IV of chapter 73 of this title, the Secretary 
may make arrangements for acquisition of the resource without 
regard to any law or regulation (including any Executive order, 
circular, or other administrative policy) that would otherwise 
require the use of competitive procedures for acquiring the 
resource.
  [(C)] (D) Any procurement of health-care resources other than 
those covered by subparagraph [(A) or (B)] (A), (B), or (C) 
shall be conducted in accordance with all procurement laws and 
regulations.
  [(D)] (E) For any procurement to be conducted on a sole 
source basis other than a procurement covered by subparagraph 
[(A)] (A) or (B), a written justification shall be prepared 
that includes the information and is approved at the levels 
prescribed in section 303(f) of the Federal Property and 
Administrative Services Act of 1949 (41 U.S.C. 253(f)).
  [(E)] (F) As used in this paragraph, the term ``commercial 
service'' means a service that is offered and sold 
competitively in the commercial marketplace, is performed under 
standard commercial terms and conditions, and is procured using 
firm-fixed price contracts.

           *       *       *       *       *       *       *


7364A. COVERAGE OF EMPLOYEES UNDER CERTAIN FEDERAL TORT CLAIMS LAWS.

           *       *       *       *       *       *       *


7368.    [REPEALED.]

           *       *       *       *       *       *       *


Sec. 7364A. Coverage of employees under certain Federal tort claims 
                    laws

  (a) An employee of a corporation established under this 
subchapter who is described by subsection (b) shall be 
considered an employee of the government, or a medical care 
employee of the Veterans Health Administration, for purposes of 
the following provisions of law:
          (1) Section 1346(b) of title 28.
          (2) Chapter 171 of title 28.
          (3) Section 7316 of this title.
  (b) An employee described in this subsection is an employee 
who--
          (1) has an appointment with the Department, whether 
        with or without compensation;
          (2) is directly or indirectly involved or engaged in 
        research or education and training that is approved in 
        accordance with procedures established by the Under 
        Secretary for Health for research or education and 
        training; and
          (3) performs such duties under the supervision of 
        Department personnel.

           *       *       *       *       *       *       *


Sec. 7368. [Repealed]

           *       *       *       *       *       *       *


TITLE 5, UNITED STATES CODE

           *       *       *       *       *       *       *


PART III--EMPLOYEES

           *       *       *       *       *       *       *


Subpart D--Pay and Allowances

           *       *       *       *       *       *       *


CHAPTER 53--PAY RATES AND SYSTEMS

           *       *       *       *       *       *       *


SUBCHAPTER II--EXECUTIVE SCHEDULE PAY RATES

           *       *       *       *       *       *       *


Sec. 5315. Positions at level IV

  Level IV of the Executive Schedule applies to the following 
positions, for which the annual rate of basic pay shall be the 
rate determined with respect to such level under chapter 11 of 
title 2, as adjusted by section 5318 of this title:

           *       *       *       *       *       *       *

          [Assistant Secretaries, Department of Veterans 
        Affairs (6).]
          Assistant Secretaries, Department of Veterans Affairs 
        (7)

           *       *       *       *       *       *       *

