Senate Veterans’ Affairs Committee Issues Report on Caring for Our Veterans Act (Part 5 of 7)

WASHINGTON, March 8 -- The Senate Veterans' Affairs Committee issued a report (S.Rpt. 115-212) on legislation (S. 2193) to amend title 38, U.S. Code (hereinafter, "U.S.C."), to improve health care for veterans. The report was advanced by Sen. Johnny Isakson, R-Georgia, on March 7.

Section 252 would authorize VA to pay for transplant procedures at various locations nationwide with minimal out-of- pocket expenses for veterans and their living donors. As a result, CBO expects more veterans would use VA for such procedures and more people would be willing to donate organs. In determining the additional number of transplant procedures, CBO considered the other sources of health care coverage carried by enrolled veterans and the likelihood, under this proposal, that those veterans would instead use VA for their transplant procedures.

Using information from the Census Bureau, VA, and the Department of Health and Human Services (HHS), CBO estimates that under this section roughly 60 additional veterans would undergo transplants at nondepartment facilities each year, at an average cost of $750,000 per patient. CBO estimates that VA would cover the medical expenses of an additional 50 living donors (some for procedures that will occur under current law but for which VA would not pay medical expenses) each year, at an average cost of $80,000 per donor. In addition, CBO believes that implementing this section would allow veterans to undergo transplants closer to home. As a result, CBO estimates a reduction in costs for transportation reimbursements of about $4 million each year. Based on the expectation that VA would implement the bill gradually, CBO estimates that implementing section 252 would have a net cost of $140 million over the 2018-2022 period.

Compensation for Medical Directors. Section 205 would remove the cap on basic pay for directors of regional and medical facilities at the department. Under current law, the salary for those positions is capped at level V of the executive schedule. CBO expects that this section would allow VA to offer competitive pay (based on compensation in the private market) for those positions. VA employs about 130 directors at an average compensation amount of $282,000 in 2017. On average, compensation for medical directors in the private sector is about $320,000. As a result of the increase in salary, CBO estimates that VA would be able to fully staff the 140 medical director positions by 2021. After factoring in a 1-year delay and additional hiring, CBO estimates that implementing this provision would cost $87 million over the 2018-2022 period.

Modify Threshold for Major Medical Facilities. Section 241 would expand the authority of VA to construct and lease medical facilities.

Section 241 would allow VA to construct medical facilities with total costs of up to $20 million without legislative authorization. Under current law, VA must receive legislative authorization to construct medical facilities with total expenses above $10 million.

Using information on planned construction projects in VA's 2018 budget submission, CBO estimates that implementing this section would authorize one additional construction project each year with an average cost of $16 million. On that basis, CBO estimates costs of $36 million over the 2018-2022 period for construction of new facilities.

In addition, this section would expand VA's authority to enter into leases for medical facilities. CBO estimates that VA would enter into six additional leases each year with a total annual rent payment of $7 million. In that case, VA would record obligations of $20 million each year as it enters those contracts at a cost of $36 million over the 2021-2022 period for additional leases. CBO estimates that this authority also would increase direct spending, which is discussed below under the heading "Direct Spending."

In total, CBO estimates implementing section 241 would cost $72 million over the 2018-2022 period.

Mobile Deployment Teams. Section 233 would require VA to establish a program to provide mobile deployment teams of medical personnel to provide health care at underserved VA facilities. On the basis of costs in the private-sector to operate mobile clinics, CBO estimates start-up costs of $300,000 per team and annual costs to operate each mobile clinic of $375,000. In addition, CBO estimates a medical team of three physicians would cost $450,000 per clinic. CBO expects that VA would implement this program gradually, starting with five mobile deployment teams in 2018 and growing to 25 by 2022. As a result, CBO estimates that implementing this section would cost $72 million over the 2018-2022 period.

Podiatrists. Section 202 would add podiatrists to the same pay schedule as physicians and dentists and thereby increase their pay. Currently, VA employs about 400 podiatrists nationwide at an average annual salary of about $130,000. On the basis of information from VA about the average increase necessary for podiatrists to move to a pay schedule comparable to that of physicians and dentists, CBO estimates that the base salary for podiatrists would increase by about 15 percent to $150,000 in 2018. In addition, using data on hiring from VA, CBO estimates that VA would be able to hire an additional 30 podiatrists because the increased pay would make working at VA more attractive. After accounting for projected pay raises, CBO estimates that implementing the provision would cost $53 million over the 2018-2022 period.

Peer Specialist Program. Section 208 would require that VA establish a program to include at least two peer specialists in PACTs to promote services for mental health, substance use disorders, and behavioral health in primary care. The program would require a rapid rollout, being implemented in at least 25 medical centers in 2018 and in at least 50 medical centers in 2019. CBO expects the department would implement the program in two PACTs per medical center. Using information from VA, CBO estimates that the 200 additional peer specialists by 2019 would receive an average salary of $41,000. After adjusting for wage growth, CBO estimates that implementing this section would cost $40 million over the 2018-2022 period.

Demonstration Program on Dental Care. Section 215 would require VA to establish a demonstration program to increase veterans' access to dental care that would require hiring and training alternative dental health providers. Those employees would include community dental health coordinators, advance practice dental hygienists, independent dental hygienists, supervised dental hygienists, primary care physicians, dental therapists, dental health aides, and any other health professionals that the Secretary determines appropriate.

Based on the scope of a similar demonstration program operated by HHS, CBO expects that developing and operating the program would require two additional full-time employees at each facility to engage in research, training, and assessment of the program. Based on the costs of similar proposals, CBO expects this program would operate within 10 medical facilities and that the annual cost per staff person would be $100,000 in 2018 and $11 million over the 2018-2022 period.

CBO expects that the use of alternative dental care providers would increase VA's delivery of dental care to veterans. CBO estimates VA would hire two additional dental health providers at each of the 10 medical facilities at an average compensation of $150,000. As a result, CBO estimates that hiring additional dental health providers would cost $14 million over the 2018-2022 period.

In total, implementing section 215 would cost $24 million over the 2018-2022 period.

Pilot Program for Tuition Reimbursement. Section 232 would require VA to carry out a 6-year pilot program to repay the education loans of certain physicians. Eligible physicians would include those who are licensed as well as those in their last year of residency who agree to work at VA for a certain period in rural locations. The department would be required to select employees in at least three medical centers and seven ambulatory care facilities.

The program would pay up to the full amount of the medical loans for newly licensed physicians and up to $50,000 of loans for current physicians at VA. For this estimate, CBO expects that VA would repay the loans of 50 physicians in each year of the pilot program, and that one-third of the participants would be newly licensed physicians and two-thirds would be established physicians at VA. Based on information from the National Center for Education Statistics and the Association of American Medical Colleges, newly licensed physicians would have an estimated average education loan debt of $170,000 in 2017. For established physicians, CBO expects that VA would reimburse about $40,000 of their student loan debt. After factoring in the growth in costs for higher education, CBO estimates that implementing the pilot program would cost $21 million over the 2018-2022 period.

Coordinated-Care Program. Section 251 would require VA to provide grants to certain public or nonprofit entities. Grant recipients would coordinate wellness care for veterans receiving mental health care from VA. The grantees also would assess the usefulness of coordinating such care and report on that assessment. That program would begin a year after enactment and continue for 3 years.

Based on VA's implementation of other programs of similar scope (such as using meditation for veterans with Post Traumatic Stress Disorder), CBO expects that VA would award grants to coordinate care at 10 VA medical facilities and that each grant would cover the costs of about four employees to deliver services and analyze and report to the Congress on the results of their efforts. CBO estimates that the average compensation for those employees would be about $120,000 in 2018. In total, after accounting for inflation, CBO estimates the cost to implement the program would be $15 million over the 2018-2022 period.

Pay for Perfusionists. Section 203 would increase the maximum salary for perfusionists employed by VA by exempting them from certain salary limitations. (Perfusionists are medical professionals responsible for operating heart-lung machines during cardiac surgery.) Currently VA employs 28 perfusionists (in the 41 VA medical facilities offering the type of cardiac surgery requiring such services) at an average salary of $101,000. On the basis of information from VA, CBO estimates that implementing this proposal would increase the salary of perfusionists at the department by 18 percent. As a result, CBO also expects that VA would see higher retention and recruitment for this position, resulting in a 20 percent increase in staff--an additional 6 perfusionists by 2022. In total, CBO estimates that implementing this section would cost $5 million over the 2018-2022 period.

Studies, Reports, and Training. S. 2193 would require VA to conduct studies, issue reports, and provide training for staff. Based on the costs of similar activities, CBO estimates that meeting those requirements would cost $10 million over the 2018-2022 period.

By December 31, 2018, section 302 would require VA to develop and implement an IT system to track and assess data from the Family Caregiver Program. VA reports that it is currently working to enhance its existing IT system for tracking caregivers to allow for an easier application process and for tracking stipend awards and other benefits. As a result, CBO estimates that this requirement would mostly codify existing practice and would have no budgetary effect. However, the provision also includes assessment and reporting requirements that CBO estimates would cost $2 million over the 2018-2022 period.

Section 104 would require that VA establish benchmark guidelines for access to health care at VA medical facilities. Such guidelines would assist medical providers on whether to refer veterans into the community for health care. The section also would establish quality standards for health care at the department. CBO estimates that this section would cost $1 million over the 2018-2022 period.

Starting in 2019 and every 2 years thereafter, section 106 would require that VA conduct market area assessments on the health care services provided by the department. Every 4 years, this section also would require VA to develop a strategic plan to meet the demand for health care provided by the department. CBO estimates that implementing this section would cost $1 million over the 2018-2022 period.

Other provisions, including sections 108, 121, 122, 123, 201, 207, and 222 would require periodic reports on education and training programs, personnel, telemedicine, and performance awards and bonuses for employees at VA. Furthermore, section 231 would require VA to develop criteria to assess underserved facilities. In total, CBO estimates that those reports and criteria would cost $6 million over the 2018- 2021 period.

Direct spending

S. 2193 would appropriate funds for the Veterans Choice Program and for health care at VA. In addition, the bill would increase VA's ability to lease medical facilities without subsequent legislative authorization. On that basis, CBO estimates that the legislation would increase direct spending by $5.6 billion over the 2018-2027 period (see Table 3).

Veterans Choice Program. Section 402 would appropriate $4 billion for VCP, which pays for certain veterans to receive health care from participating providers in the private sector. For fiscal year 2018, VCP has about $4 billion in available funds, which CBO estimates will be completely committed in 2018. Under current law, the program will terminate once its funding is exhausted. CBO expects that enacting this provision would extend the life of VCP through most of 2019. On that basis, CBO estimates that section 402 would increase direct spending by $4 billion over the 2018-2027 period.

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Health Professionals Education Assistance Program. Section 401 would appropriate $1 billion for reimbursing employees at VA for their professional education. Specifically, the appropriations would be used to increase the number of graduate medical residents at VA (under sections 202 and 203 of this bill), increase bonuses and awards for VA employees (under section 204), and increase the payments for reducing student loan debt for certain VA staff (under section 213). CBO estimates that the appropriated amounts would be sufficient to fund those programs through 2024. Beyond that year, CBO estimates that the increased program costs would continue, subject to appropriation of the necessary amounts. CBO estimates section 401 would increase direct spending by $1 billion over the 2018-2027 period.

Major Medical Facilities. Sections 241 would expand VA's authority to enter into leases for medical facilities. (Provisions also would expand the authority to construct medical facilities, discussed above under the heading "Spending Subject to Appropriation.") In total, CBO estimates that enacting this section would increase direct spending by $413 million over the 2018-2027 period.

VA classifies its contracts for acquiring such facilities as operating leases and thus records its obligations for lease payments on an annual basis over the term of each lease. However, CBO has reviewed several contracts and has concluded that they are akin to government purchases of facilities built specifically for VA's use--but instead of being financed by the Treasury, they rely on third-party financing (that is, funds raised by a nonfederal entity), which is generally more expensive.2 That conclusion is based on those leases having many of the following key features:

2For more information on the budgetary treatment of third-party financing, see Congressional Budget Office, Third-Party Financing of Federal Projects (June 2005), www.cbo.gov/publication/16554.

The facilities are designed and constructed to the unique specifications of the government;

The facilities are constructed at the request of the federal government;

The leases on the newly constructed facilities are long term--usually 20 years;

Payments from the federal government are the only or the primary source of income for the facilities;

The term of the contractual agreements coincides with the term of the private partner's financing instrument for developing and constructing the facility (that is, a facility financed with a 20-year bond will have a 20-year lease term);

The federal government commits to make fixed annual payments that are sufficient to service the debt incurred to develop and construct the facility, regardless of whether the agency continues to occupy the facility during the guaranteed term of the lease; and

The fixed payments over the life of the lease are sufficient to retire the debt for the facility.3

3See testimony of Robert A. Sunshine, Deputy Director, Congressional Budget Office, before the House Committee on Veterans' Affairs, The Budgetary Treatment of Medical Facility Leases by the Department of Veterans Affairs (June 27, 2013), www.cbo.gov/ publication/44368.

Thus, although those transactions are structured as leases, they are essentially government purchases. Under the normal procedures governing the budgetary treatment of the purchase of capital assets, budget authority should be available and obligations should be recorded at the time the acquisitions are initiated, and amounts recorded should equal the full development and construction costs of the medical facilities. Instead, VA records a small fraction of those costs as obligations when it awards the contracts for such transactions.

To the extent that the full costs of developing and constructing the facilities exceeds the relatively small amount that VA would initially record as obligations against its appropriation, CBO treats the legislative authorization for those transactions as contract authority--a type of budget authority that allows an agency to enter into a contract and incur an obligation before receiving an appropriation for those activities. Because the contract authority would be provided in an authorizing bill, rather than in an appropriation act, the resulting spending is categorized as direct spending (as distinguished from discretionary spending, which results from appropriation acts).

In addition, at the time the contracts are signed, VA typically obligates some amounts from available appropriations; those costs are considered discretionary.

Section 241 would allow VA to enter into leases without legislative authorization for medical facilities with annual lease payments of up to $1.5 million. Under current law, VA must receive legislative authorization to lease medical facilities with annual rent payments in excess of $1 million.

After reviewing VA's 2018 budget request for leases of medical facilities, CBO estimates that enacting this provision would allow VA to enter into six additional leases, on average, each year. In total, the annual rent payments for those leases would be about $7 million. CBO expects that the initial contracts for those facilities would be entered into starting in 2021 and that similar contracts would be signed each year thereafter.

When the government leases a facility the lessor charges the government for the cost to construct the facility plus interest on those costs over the period it takes to recover them through the lease payments. CBO's estimate of direct spending reflects an amount equal to the cost of constructing the facilities, plus the net present value of the portion of lease costs attributable to interest rates that would exceed U.S. Treasury interest rates. (Borrowing costs equivalent to the amount of Treasury interest that would be paid if the equipment was financed with appropriated funds are not included in our estimate because, for the enforcement of Congressional budget rules, changes in Treasury interest costs are not counted as a cost or savings related to any particular legislative provision.) CBO's estimate of outlays reflects its judgment as to when the facilities would be provided--typically over a 6-year period.

On that present value basis for each lease over the term of the lease agreement, CBO estimates that enacting this provision would increase direct spending by $413 million over the 2021- 2027 period.4

4A present value is a single number that expresses a flow of past and future income or payments in terms of an equivalent lump sum received or paid today. The value depends on the rate of interest, known as the discount rate, used to translate past and future cash flows into current dollars. CBO calculated costs for the 20-year leases by discounting the expected annual rent payments using the rate on Treasury securities of comparable maturity.

Shared Medical Facilities. Section 242 would allow VA to enter into sharing agreements with other federal agencies to lease medical facilities. VA's portion of the annual rent payments for leased medical facilities could be lowered by enough that some leases would no longer require legislative authorization. Using information from VA, CBO estimates that, on average, this section would allow construction of one medical facility each year with an average annual rent payment of $3 million. CBO expects that VA would enter into the first such contract in 2021 and that similar contracts would take effect each year thereafter. On a present value basis for each lease over the term of the lease agreement, CBO estimates that enacting this section would increase direct spending by $168 million over the 2021-2027 period.

Pay-As-You-Go Considerations: The Statutory Pay-As-You-Go Act of 2010 establishes budget-reporting and enforcement procedures for legislation affecting direct spending or revenues. The net changes in outlays that are subject to those pay-as-you-go procedures are shown in Table 4.

Table 4.--CBO Estimate of Pay-As-You-Go Effects of S.2193, The Caring for Our Veterans Act of 2017, as Ordered

Reported by the Senate Committee on Veterans' Affairs on November 29, 2017

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Increase in long-term direct spending and deficits

CBO estimates that enacting the draft bill would not increase net direct spending or on-budget deficits by more than $2.5 billion in any of the four consecutive 10-year periods beginning in 2028.

Mandates

S. 2193 would impose an intergovernmental mandate as defined in UMRA by preempting state laws that prohibit VA physicians from practicing telemedicine to treat veterans across state lines. Although it would limit the application of state regulations, the bill would impose no duty on state governments that would result in additional spending or any significant loss of revenues.

The bill contains no private-sector mandates as defined in UMRA.

Previous CBO estimates: On November 13, 2017, CBO transmitted a cost estimate for H.R. 4243, the VA Asset and Infrastructure Review Act of 2017, as ordered reported by the House Committee on Veterans' Affairs on November 8, 2017. Sections 201 and 204 in H.R. 4243 are similar to sections 241 and 242 of S. 2193 and the estimated costs for both sections are the same.

On November 8, 2017, CBO transmitted a cost estimate for H.R. 1133, the Veterans Transplant Coverage Act of 2017, as ordered reported by the House Committee on Veterans' Affairs on July 19, 2017. H.R. 1133 is similar to section 252 of S. 2193 and the estimated costs are the same.

On July 24, 2017, CBO transmitted a cost estimate for H.R. 1058, the VA Provider Equity Act, as ordered reported by the House Committee on Veterans' Affairs on July 19, 2017. The language in H.R. 1058 that affects podiatrists is similar to section 202 of S. 2193 and the estimated costs are the same.

Estimate prepared by: Federal Costs: Ann E. Futrell; Mandates: Zachary Byrum.

Estimate approved by: H. Samuel Papenfuss, Deputy Assistant Director for Budget Analysis.

Regulatory Impact Statement

In compliance with paragraph 11(b) of rule XXVI of the Standing Rules of the Senate, the Committee on Veterans' Affairs has made an evaluation of the regulatory impact that would be incurred in carrying out the Committee bill. The Committee finds that the Committee bill would not entail any regulation of individuals or businesses or result in any impact on the personal privacy of any individuals and that the paperwork resulting from enactment would be minimal.

Tabulation of Votes Cast in Committee

In compliance with paragraph 7(b) of rule XXVI of the Standing Rules of the Senate, the following is a tabulation of votes cast in person or by proxy by members of the Committee on Veterans' Affairs at its November 29, 2017, meeting. Twenty-two amendments to the Committee Bill were voted on by members.

Chairman Isakson called up nineteen amendments to be considered en bloc. The amendments were sponsored by Senators Sullivan, Heller, Cassidy, Rounds, Sanders, Blumenthal, Moran, Tillis, and Brown. The amendments were agreed to by voice vote.

An amendment by Senator Moran would have replaced sections of the Committee Bill regarding community care, access and quality standards, prompt pay, access to walk-in care, a strategy for care provided by VHA, authorization of appropriations for care provided in VHA, and the appropriation of $4 billion for the Veterans Choice Program. In addition, the amendment would have added provisions to the Committee Bill relating to continuity of care, payment rates for care in the community, and a center of innovation for care and payments. This amendment was not agreed to by voice vote and Senator Moran requested that he be recorded as voting aye.

An amendment by Senator Cassidy would have removed a section of the Committee Bill that allowed veterans to file a disability compensation claim for adverse medical events for care received in the community. This amendment was not agreed to by voice vote.

The Committee also discussed amendments sponsored by Senator Sanders but did not vote on those amendments because they were withdrawn.

The Committee Bill, as amended during the Committee meeting, was agreed to by a roll call vote.

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Agency Reports

On May 17, 2017, Jennifer S. Lee, M.D., Deputy Under Secretary for Health for Policy and Services, Veterans Health Administration; on July 11, 2017, Baligh Yehia, M.D., Deputy Under Secretary for Health for Community Care, Veterans Health Administration from the Department of Veterans Affairs appeared before the Committee on Veterans' Affairs and submitted testimony on various bills incorporated into the Committee bill. Excerpts from those statements are below:

STATEMENT OF DR. JENNIFER S. LEE, DEPUTY UNDER SECRETARY FOR HEALTH FOR POLICY AND SERVICES VETERANS HEALTH ADMINISTRATION DEPARTMENT OF VETERANS AFFAIRS

Good morning, Chairman Isakson, Ranking Member Tester, and Members of the Committee. Thank you for inviting us here today to present our views on several bills that would affect the Department of Veterans Affairs' (VA) programs and services. Joining me today is Ms. Margaret Kabat, National Director, Caregiver Support Program, Veterans Health Administration (VHA); Phil Parker; Acting Associate Deputy Assistant Secretary, Office of Acquisition and Logistics, Office of Acquisition, Logistics, and Construction (OALC); Mr. James Ruhlman, Assistant Director for Policy & Procedures, Veterans Benefits Administration (VBA); Ms. Meghan Flanz, Interim General Counsel; Dave McLenachen, Director, Appeals Management Office, VBA; and Donnie Hachey, Chief Counsel for Operations, Board of Veterans Appeals (BVA).

There are a number of bills on the agenda today, and we are unable at this time to provide views and cost estimates on a few of these provisions. Specifically, we do not have cost estimates on S. 543 and S. 764.

S. 591--MILITARY AND VETERAN CAREGIVERS SERVICE IMPROVEMENT ACT OF 2017

S. 591 would expand eligibility for VA's Program of Comprehensive Assistance for Family Caregivers, expand benefits available to participants under such program, enhance special compensation for certain members of the uniformed services who require assistance, and make other amendments to increase the provision of benefits.

The Caregivers and Veterans Omnibus Health Services Act of 2010, Public Law 111-163, signed into law on May 5, 2010, provided expanded support and benefits for caregivers of eligible and covered Veterans. While the law authorized certain support services for caregivers of covered Veterans of all eras, other benefits were authorized only for qualified family caregivers of eligible Veterans who incurred or aggravated a serious injury in the line of duty on or after September 11, 2001. These new benefits for approved family caregivers, provided under the Program of Comprehensive Assistance for Family Caregivers, include a monthly stipend paid directly to designated primary family caregivers and medical care under CHAMPVA for designated primary family caregivers who are not eligible for TRICARE and not entitled to care or services under a health-plan contract.

Section 2 of S. 591, the Military and Veteran Caregiver Services Improvement Act of 2017, would remove "on or after September 11, 2001" from the statutory eligibility criteria for the Program of Comprehensive Assistance for Family Caregivers, and thereby expand eligibility under the program to Veterans of all eras who otherwise meet the applicable eligibility criteria. Family caregivers could not receive assistance under this expanded eligibility until FYs 2018, 2020, or 2022 depending on the monthly stipend tier for which their eligible Veteran qualifies. Section 2 would also add "or illness" to the statutory eligibility criteria, and thereby expand eligibility to include those Veterans who require a caregiver because of an illness incurred or aggravated in the line of duty. In addition, the bill would expand the bases upon which a Veteran could be deemed to be in need of personal care services, to include "a need for regular or extensive instruction or supervision without which the ability of the Veteran to function in daily life would be seriously impaired."

This section would also expand the assistance available to primary family caregivers under the Program of Comprehensive Assistance for Family Caregivers to include child care services, financial planning and legal services "relating to the needs of injured and ill Veterans and their caregivers," and respite care that includes peer-oriented group activities. The bill would ensure that in certain circumstances VA accounts for the family caregiver's assessment and other specified factors in determining the primary family caregiver's monthly stipend amount. In addition, the bill would require VA to periodically evaluate the needs of the eligible Veteran and the skills of the family caregiver to determine if additional instruction, preparation, training, or technical support is needed, and it would require certain evaluation be done in collaboration with the Veteran's primary care team to the maximum extent practicable.

Section 2 would also authorize VA, in providing assistance under the Program of Comprehensive Assistance for Family Caregivers, to "enter into contracts, provider agreements, and memoranda of understanding with Federal agencies, states, and private, nonprofit, and other entities" in certain circumstances. It would expand the definition of family member to include a non-family member who does not provide care to the Veteran on a professional basis, and it would amend the definition of "personal care services." The bill would also end the Program of General Caregiver Support Services on October 1, 2022, but would ensure that all of its activities are carried out under the Program of Comprehensive Assistance for Family Caregivers. Finally, the bill would amend the annual reporting requirements for the Program of Comprehensive Assistance for Family Caregivers.

In September 2013, VA sent a report to the Committees on Veterans' Affairs of the Senate and House of Representatives (as required by Section 101(d) of Public Law 111-163) on the feasibility and advisability of expanding the Program of Comprehensive Assistance for Family Caregivers to family caregivers of Veterans who incurred or aggravated a serious injury in the line of duty before September 11, 2001. In that report, VA noted that expanding the Program of Comprehensive Assistance for Family Caregivers would allow equitable access to seriously injured Veterans from all eras (who otherwise meet the program's eligibility criteria) and their approved family caregivers.

In the report, however, VA noted difficulties with making reliable projections of the cost effect of opening the Program of Comprehensive Assistance for Family Caregivers to eligible Veterans of all eras, but estimated a population range of 32,000 to 88,000 additional Veterans in the first year (estimated for FY 2014), at a cost of $1.8 billion to $3.8 billion in the first year (estimated for FY 2014). After VA provided this report to Congress, the RAND Corporation published a report titled, "Hidden Heroes: America's Military Caregivers," which estimates a significantly larger eligible population (1.5 million) that may be eligible if the program were expanded to caregivers of pre-9/11 Veterans and those qualifying due to illness. VA's estimates in its 2013 report did not account for expansion to eligible Veterans with an illness incurred or aggravated in the line of duty, other Veterans who would become eligible for the program based on the amendments in section 2, or the additional assistance that would become available to primary family caregivers under the bill. This estimate also did not factor in a phased implementation of stipend expansion, as contemplated by the bill.

VA cannot responsibly provide a position in support of expanding the Program of Comprehensive Assistance for Family Caregivers without a realistic consideration of the resources necessary to carry out such an expansion, including an analysis of the future resources that must be available to fund other core direct-to-Veteran health care services. This is especially true as VA presses to strengthen mental health services and ensure the fullest possible access to care across the system.

We wish to make it very clear that VA believes an expansion of those benefits that are currently limited by era of service would result in equitable access to the Program of Comprehensive Assistance for Family Caregivers for long- deserving caregivers of those who have sacrificed greatly for our Nation. However, VA cannot endorse this measure before further engaging with Congress on these fiscal constraints, within the context of all of VA health care programs.

Additionally, before expanding eligibility under the Program, we believe it prudent for VA to ensure that the current eligibility criteria are applied in a consistent manner across the program. For example, the National Caregiver Support Program is undergoing an internal review to evaluate consistency in revocations and reductions from the Program and standardize communication with Veterans and Caregivers. On April 17, 2017, VA suspended certain VA-initiated revocations in order to carry out this review.

VA welcomes further discussion of these issues with the Committee.

Section 3 of this bill proposes to add a new section 3319A to title 38 to authorize individuals who are eligible for and participating in a program of comprehensive assistance for family caregivers under 38 U.S.C. Sec. 1720G(a) the opportunity to transfer their unused Post-9/11 GI Bill education benefits to their dependents. Veterans may complete the transfer of entitlement any time during the 15-year period beginning on the date of their last discharge or release from active duty. There is no length of service requirement, and the monthly rate of educational assistance would be the same rate payable to the individual making the transfer. The Secretary would be authorized to prescribe regulations to carry out this section. We note that the Survivors' and Dependents' Educational Assistance (DEA) program, or chapter 35, currently offers education and training benefits to eligible dependents of members of the Armed Forces and Veterans who have a service- connected disability rated as permanently and totally disabling, including individuals who are eligible for a program of comprehensive assistance for family caregivers. Assistance includes up to 45 months of full-time benefits.

VA supports the intent of section 3 to take care of caregivers; however, VA cannot support this section as written. The transfer of entitlement provisions of the Post-9/11 GI Bill were established as a recruitment and retention tool for the uniformed services. As such, the Department of Defense (DOD) determines eligibility for transfer of entitlement. If enacted, the proposed legislation would require VA to develop procedures to receive requests to transfer entitlement for certain individuals, determine eligibility, and award benefits for the transfer of entitlement program. However, VA notes that Congress would need to identify appropriate offsets for the cost of this legislation

Additionally, under the proposed section 3319A, dependents would receive the same rate of payment as otherwise payable to the individual making the transfer. This is different than the rate payable for a dependent child using transferred entitlement under section 3319. Currently, a dependent child is awarded benefits as if the individual making the transfer were not on active duty. As such, a child is entitled to the monthly housing allowance stipend even though the individual transferring benefits is still on active duty. Under the proposed legislation, a child would not be eligible for the housing allowance while the individual described in 38 U.S.C. Sec. 1720G(a)(2) is on active duty. This change would impact the Long-Term Solution for processing Post-9/11 GI Bill claims, as VA would have to make system modifications in order to apply a blended set of rules for claims involving transferred education benefits.

Section 4(a) would amend 37 U.S.C. 439, providing for special compensation for members of the uniformed services with catastrophic injuries or illnesses requiring assistance in everyday living, by amending the definition of covered members to include those Servicemembers who have a serious injury or illness that was incurred or aggravated in the line of duty and are in need of personal care services as a result of such injury or illness. Section 4(b) would further amend section 439 by requiring VA to provide family caregivers of a Servicemember in receipt of monthly special compensation the assistance available to family caregivers of eligible Veterans under 38 U.S.C. Sec. 1720G(a)(3)(A), other than the monthly caregiver stipend. VA would provide assistance under this subsection in accordance with a memorandum of understanding (MOU) between VA and DOD, and an MOU between VA and the Secretary of Homeland Security. VA would be required to ensure that a family caregiver in receipt of assistance under this subsection is able to transition seamlessly to the receipt of assistance under 38 U.S.C. Sec. 1720G. Section 4(c) would require DOD, in collaboration with VA, to ensure that members of the uniformed services in receipt of monthly special compensation are aware of the eligibility of such members for family caregiver assistance. Section 4(d) would define the term "serious injury or illness," which would replace the term "catastrophic injury or illness," to mean an injury, disorder, or illness that (1) renders the afflicted person unable to carry out one or more activities of daily living; (2) renders the afflicted person in need of supervision or protection due to the manifestation by such person of symptoms or residuals of neurological or other impairment or injury; (3) renders the afflicted person in need of regular or extensive instruction or supervision in completing two or more instrumental activities of daily living; or (4) otherwise impairs the afflicted person in such manner as the Secretary of Defense or Homeland Security prescribes.

Regarding section 4 of the bill, VA defers to DOD and the Department of Homeland Security regarding sections 4(a), 4(c), and 4(d). VA does not support section 4(b) because DOD already provides many of the services and supports available under VA's Program of Comprehensive Assistance for Family Caregivers including health care coverage, mental health services, and respite care. Requiring VA to provide services under its program would result in a duplication of efforts.

Section 5 would authorize the Office of Personnel Management (OPM) to promulgate regulations under which a covered employee, which would include a caregiver defined in 38 U.S.C. Sec. 1720G or a caregiver of an individual receiving compensation under 37 U.S.C. Sec. 439, to use a flexible schedule or compressed schedule or to telework. VA defers to OPM on this section.

Section 6 would amend the Public Health Service Act (42 U.S.C. Sec. 300ii), which governs lifespan respite care, to amend the definition of "adult with a special need" to include a Veteran participating in the family caregiver program under 38 U.S.C. Sec. 1720G(a). It would also amend the definition of "family caregiver" to include family caregivers under 38 U.S.C. Sec. 1720G. Furthermore, in awarding grants or cooperative agreements to eligible state agencies to furnish lifespan respite care, HHS would be required to work in cooperation with the interagency working group on policies relating to caregivers of Veterans established under section 7 of this bill. Section 6 would also authorize appropriations of $15 million for FYs 2017 through 2022 for these grants. VA defers to HHS on this section.

Section 7 would establish an interagency working group on policies relating to caregivers of Veterans and Servicemembers. The working group would be composed of a chairperson selected by the President, and representatives from VA, DOD, HHS (including the Centers for Medicare & Medicaid Service), and the Department of Labor. The working group would be authorized to consult with other advisors as well. The working group's duties would include regularly reviewing policies relating to caregivers of Veterans and Servicemembers, coordinating and overseeing the implementation of policies relating to these caregivers, evaluating the effectiveness of such policies, developing standards of care for caregiver and respite services, and others. Not later than December 31, 2017, and annually thereafter, the working group would be required to submit to Congress a report on policies and services relating to caregivers of Veterans and Servicemembers.

VA generally supports a working group that would provide a forum for analyzing and evaluating different issues that family caregivers of Veterans and Servicemembers face. Such a working group would be ideally suited to considering in depth the types of issues other provisions of this bill are intended to address and would also be able to evaluate emerging issues.

The Department of Justice advises, however, the bill's method for selecting members of the working group raises Appointment Clause concerns, which DOJ will convey in greater detail under separate cover.

We also note several technical concerns with the legislation in terms of the creation of the working group, its role, the potential applicability of the Federal Advisory Committee Act to such a group, and which agency (if any) would be responsible for initiating, managing, and funding the working group. We would be happy to discuss these issues with you upon your request.

Section 8(a) would require VA to conduct a longitudinal study on Servicemembers who began their service after September 11, 2001. VA would be required to award a grant to or enter into a contract with an appropriate entity unaffiliated with VA to conduct the study. Within 1 year of the date of the enactment of the Act, VA would be required to submit to the Committees on Veterans' Affairs a plan for the conduct of the study. Not later than October 1, 2021, and not less frequently than once every 4 years thereafter, VA would be required to submit to the Committees on Veterans' Affairs a report on the results of the study. Section 8(b) would require VA to provide for the conduct of a comprehensive study on Veterans who have incurred a serious injury or illness and individuals who are acting as caregivers for Veterans. VA would be required to award a grant to or enter into a contract with an appropriate entity unaffiliated with VA to conduct the study. The study would be required to include the health of the Veteran and the impact of the caregiver on the health of the Veteran, the employment status of the Veteran and the impact of the caregiver on that status, the financial status and needs of the Veteran, the use by the Veteran of VA benefits, and any other information VA considers appropriate. No later than 2 years after the date of the enactment of this Act, VA would be required to submit to the Committees on Veterans' Affairs a report on the results of this study.

VA does not support section 8, as it would duplicate research in several ongoing or in-development studies. DOD and VA have a collaboration on the Millennium Cohort Study, a longitudinal cohort study that has and will continue to produce findings on health issues of multiple eras of military service. The Million Veterans Program creates a repository of clinical and genetic information on Veterans, including post-9/11 Veterans, which will provide data for targeted studies on health for years to come. VA's Cooperative Studies Program is developing a study on the respiratory health of Gulf War and post-9/11 Veterans. Finally, a study of the life transitions of military Servicemembers who served in Iraq or Afghanistan is funded and in development.

VA estimates section 8 would cost $4.3 million in FY 2018, $17.5 million over 5 years, and $34 million over 10 years, with additional close out expenses of $3.3 million in FY 2028 for a total cost of $37.3 million.

DRAFT--VETERAN PARTNERS' EFFORTS TO ENHANCE REINTEGRATION (PEER) ACT

The draft bill would require the Secretary to phase in and conduct a program whereby peer specialists would be included in patient aligned care teams at VAMCs to promote the use and integration of mental health services in a primary care setting. Not later than 180 days after the date of enactment, this program would have to be established at not fewer than 10 VAMCs. By not later than 2 years from the date of enactment, it would have to be in place at not fewer than 25 VAMCs. Under the bill, the Secretary would be directed to consider specified factors when selecting sites for this program, but, not fewer than five would have to be established at VA designated Polytrauma Centers, and not fewer than ten would have to be established at other VAMCs. The draft bill would also require that all peer specialist programs established under this mandate: (1) ensure that the needs of female Veterans are considered and addressed; and (2) include female peer specialists. Finally, this measure would establish initial, periodic, and final Congressional reporting requirements, as detailed in the bill.

VA has no objection to the bill, but notes that it is not necessary because VA already has the authority to execute this program. However, we would require additional funding to implement it. We also note that a few technical changes are needed for clarity. This legislation, if enacted, would complement VA's ongoing pilot program (commenced in 2014) whereby peer support through peer specialists has been extended beyond traditional mental health sites of care to include Veterans receiving mental health care in primary care settings. Under the pilot program, trained peer specialists work with VA primary care teams to, in general terms, help improve the health and well-being of other Veterans being treated in VA primary care settings. All 25 sites now have assigned one peer specialist to work in Primary Care at least 10 hours per week. The first cohort of eight sites began seeing Veterans in primary care in January 2016, the second cohort of eight began in August 2016, and the final nine sites began April 1, 2017. To date, the peers in this program have provided services to more than 3,000 Veterans. The response from Veterans, peers, and primary care clinicians has been overwhelmingly positive. Sites made a 1- year commitment to participate in the project, and VA will have a formal program evaluation based on clinical and other outcomes in 2018. It is likely that some of the existing sites will not be able to continue the pilot program after FY 2017 without additional funding.

The bill specifies program participation of female peer specialists. I am pleased to report that women peer specialists are already well represented, with 16.2 percent of the national peer specialist workforce being women. While at first glance 16.2 percent may seem a low rate, please bear in mind that this figure is higher than the percentage of Veterans seeking services through VA who are women. We do recognize, however, that the current number of women Veteran peer specialists in the pilot is unevenly distributed across the country, with some VAMCs having greater difficulty than others in attracting qualified applicants.

Also, it is unclear if the peers will address substance use disorders under the umbrella of their mental health duties. Given the comorbidity of these issues, the need for integration of substance use disorder identification and care, the need for overdose prevention and links as needed to Medication Assisted Treatment for opioid use disorders, and the need to increase the numbers of Veterans achieving long-term recovery, we recommend that this be clarified and, if possible, included.

We estimate this bill would cost $4.94 million in FY 2018, $25.99 million over 5 years, and $55.48 million over 10 years.

Continues with Part 6 of 7

TARGETED NEWS SERVICE: Myron Struck, editor; 703/304-1897; [email protected]; https://targetednews.com