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tv   VA Secretary Shulkin Testifies on FY 2018 Budget  CSPAN  June 14, 2017 2:40pm-4:42pm EDT

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chairman isakson: let me apologize for being late. i got caught on a couple things coming down the hall which i don't want to slip up. we'll stand at ease. that's a military term i learned a long time ago in the air force for one minute while i talk to my warm and trusted friend, the ranking member, then we'll open the hearing.
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chairman isakson: call this meet of the senate veterans' affairs committee together. i apologize again for being a little bit late i want to make sure we're on the right track. i didn't mess anything up. i want to welcome secretary shulkin, who has had a great start. i don't think anybody in this administration started out with a better unanimous vote than he. doing better than unanimous when you are confirmed. i think the vote last week on accountability was extraordinary. and the way we got to the decision working together was extraordinary and i commend the ranking member on his help in doing the same. we have some other things to do today to start talking about. we'll have some other decisions
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made. we can keep the same tempo, same discipline, and same commitment to making sure we all know what each other knows before they happen rather than find out after the fact we'll all be better off. i welcome dr. shulkin and the other members of the staff that are here today. and appreciate all that they are doing in our meeting the other day to explain where we're going in the veterans administration which is upward and outward and further ahead. i'll make a long statement at all except to say a long statement. one thing i have to brag about, the decision in getting our electronic medical records issues solved after years of unwillingness to address it is extraordinary. and i think from what i have heard, people are coming together in the past hadn't been together to make sure this happens and works sufficiently for our veterans and for the department of defense and the department of veterans affairs at the same time. it was silly to have an agency,
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two different agencies in the same government serving the same soldiers fighting for the same country and same constitution that two medical systems that were not interoperable. one to the other. and our veterans who fought for us would literally fall in a hole leaving from active duty to department of defense to veterans' affairs. i think this move will prove to be a tremendous move. economically for the v.a. and benefit wise for our veterans. and there is no possible way to do any better than that. i commend you on that decision as well. with that instead of getting into details i turn for an opening statement to the ranking member, john tester. senator tester: thank you, mr. chairman. thanks for having this hearing. i think it's important to say that our thoughts are with the colleagues who were the victims this morning. we wish a speedy recovery for congressman scalise and everybody else who was injured. and a big, big thank you to the capitol police officers who work every day to make sure
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this place is a safe place. our thoughts with them. secretary shulkin, i want to thank you for being here. i want to thank you for being here with your v.a. team. we spoke last week are about the future choice program and i hope i made my perspective clear. it was intended to supplement care. provided directly by the v.a. not replace it. not now, not in the future. i worry the budget proposed by this administration starts us down a path of unfettered choice that will hollow out the v.a. n doing so it proposes to increase funding for community care by a third while proposing the v.a.'s only hospitals receive an increase that is less than half of the medical inflation rate, not much. further, the budget does absolutely nothing to address v.a.'s aging infrastructure. v.a.'s hospital for fund used to hire staff and provide care for veterans while also denying them money to address the environment care concerns, we know what that outcome will be. soon enough there won't be any
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quality v.a. hospital staff by quality providers. and the v.a. care will become nothing more than a voucher plan to send veterans into the private sector to hunt for a doctor who has the time and the capacity and the knowledge to treat them. that is not what our veterans need. it's not what the veterans want to happen. for a state like mine, montana, it would be a disaster. we need to be honest. each year more and more rural hospitals are at the risk of closing. if their rollbacks to recent medicaid expansions it's likely these closures will accelerate. we can't assume rural care will work where there are not providers in the first place. we know the vast majority of veterans using choice are eligible due to long wait lines not because they live too far from a v.a. facility. data shows that rural veterans aren't just using choice but they do defend on v.a. care. but now based on your quest yesterday, we may have to shift
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additional funds around to get the choice program through the fiscal year. for months we have been asking about the choice suspend rate and the amount of funds -- remaining funds. we were never provided with those answers we needed to make informed decisions, and now we're in a difficult spot. mr. secretary, no one wants to lay the -- delay the care for veterans. will act appropriately in a timely manner to solve this problem. for that to happen this late in the game is a bit frustrating to me. and my frustration's compounded by a budget that cuts services veterans rely on. makes cuts to education oversight. and cuts to i.t. which affects every business line. i'm most concerned it appears these cuts are being made to pay for certain veterans to get private care. the new policies proposed in this budget to pay for private care are simply untenable. to put forward a proposal that would without warning stop earned benefits payments to the most severely disabled vets is unacceptable n this case we're not talking about folks milking
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the system for government fund and compensation that they don't need or don't deserve. to get the individual on plan ben fete payment, it must be determined he must be engage in work as a direct result of service to their contry. president trump's budget proposes we stop paying these veterans at a time when more americans are having to work longer to make -- longer in their lives to make ends meet. all in the name of finding more money for choice. that's a nonstarter and i hope we can get your commitment today to keep this important benefit in place. i look forward to working with my colleagues, both sides of the aisle, to address these concerns and look forward to hearing from you and how you intend to prioritize funding for veterans who get care and benefits directly from the v.a. finally i would like to wish the u.s. army a happy birthday. with that, thank you, mr. chairman. i look forward to your testimony, secretary shulkin. chairman isakson: welcome. let me introduce those you brought with you to back you up. we appreciate them.
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edward murray, thank you for being here acting assistant secretary for management and chief financial officer. richard chandler, deputy assist ant secretary, resource management. mark yow, chief financial officer, veterans health administration. james manker, acting principal deputy under secretary for benefits. and mr. matthew sullivan, deputy under secretary for finance and planning. secretary shulkin, floort is yours. secretary shulkin: thank you, chairman isakson, ranking member tester, and other members of the committee. as you can see i brought a big team with me because i know you are going to have lots of questions and in particular with the opening statements i really do look forward to having a meaningful discussion and getting to some solutions and some closure on some of these issues. i also did want to echo the ranking member's concern that the is a sad day for
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nation where public servants who work as hard as i know all of you do have to worry about their personal safety and our thoughts and prayers are with t nation where the congressman and the staff and the capitol police as well. thank you again for allowing us to be here today. what we want to talk about today is the 2018 president's budget and the 2019 advanced appropriations. and all of this is in way of showing support for veterans. we appreciate the legislation that recently been passed. as you know, you passed just within the past week the accountability bill and that went through the house yesterday. we're looking forward to actually next tuesday bringing it for a signature for the president. and that's good news. we also appreciate your support for the veterans choice improvement act that you supported. and for providing us for the first time in a long time the full 2017 budget. this is really allowed us to make real progress for veterans. we're again grateful for that
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support. i have submitted the full written statement for the record. let me just start by thanking you again for allowing us to participate in the hearing last week. seems like we were just here with you. i thought it was an excellent hearing. good discussion on choice. and that type of discussion, dialogue, will allow us to help get it right for veterans. when i testified before the house veterans' affairs committee on march 7, we had $2.0 billion in the choice account. less than a month and a half later when the president signed the choice extension act into law, our choice account was at $1.5 billion. today that account is at $821 million. as we know more veterans than ever are using choice. we have authorized $8.2 million community care appointments since january of this year. that's 2.6 million more than last year, or a 46% increase.
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in fact, march, april, and may were the largest months ever for choice. and frankly that happened because we fixed so many of the problems that we have all been working to fix with choice. and we have been increasing our use of choice. one of the reasons why is the 17 budget as you may remember actually had $2 billion less in community care, so we have been putting more through choice. two years ago, i'm sure you're going to remember, in july of 2015, we had two little -- too little money in our community care accounts within the v.a. which we solved with your help by accessing unused funds in the choice account. so we transferred money from choice into community care. we now have too little money in the choice account which we're working to solve again working with you with legislative authority to replenish funds into the choice account. so this is the situation that have described before where
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for a single purpose of providing care in the community we have two checking accounts. will i tell you i wish it were easier than it is. we have to figure for a single purpose of providing care in the community balance these two checking accounts at all times. obviously it's not a sigh epidemics, it's an heart. we're having difficulty with that once again. that's why we need to work with you to solve it. the veterans care program that we outlined for you last week will solve this recurring problem permanently by modernizing and consolidating all the community care accounts, including choice. the president's budget in 2018 and 2019 provides additional funds for choice and the resources necessary to continue the ongoing modernization of v.a. it requests $186.5 billion for v.a. $104.3 billion in mandatory funding, and $82.1 billion in discretionary funding. for a total increase of $6.4 billion, or 3.of% over 2017.
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it provides $2.9 billion in mandatory funding to tint choice program in 2018 plus a 7.1% increase in discretionary funding for v.h.a. to improve patient access and timeliness of care. it supports the strengthening, foundational services, as well as modernization and consolidating v.a. community care through the veteran care program announced last week. so veterans can make the right decision abouts their care together with their physician or provider, giving them yet another reason to choose v.a. this budget reflects the president's strong personal commitment to the nation's veterans. it's also a budget we need to achieve. my priority as secretary providing greater choice for veterans, modernizing our systems, focusing our resources towards what's most important for veterans, improving the timeliness of our services, and suicide prevention. we're already taking steps to meet the challenges that we face.
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at the president's direction, we have established a v.a. accountability office. the resent decisions made by the senate and house will help us with that. we have recently removed two medical center directors and three other senior executives. we simply will not tolerate employees who act counter to our values or put veterans at risk. i recently announce add new waste, fraud, and abuse prevention advisery committee which will be set up and running later this summer. i also directed the v.a. central office remain under a hiring freeze, those are for administrative position, as we consolidate program offices, implement shared service, and realign overhead to get more money back to the field. we now have same day services for primary care mental health at all of our medical septemberers. veterans can access wait time data for their local v.a. use n an online easy to use tool to understand access and quality. no other health system in the country has this type of transparency. we have made it easier for veterans to fill online health care applications.
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so much easier that since last summer we received eight times as many online applications than the year before. last month we were able to process a disability claim in just three days. i said that right. a disability claim processed in three days. using a new process called decision ready claims. we'll be introducing decision ready claims nationally september 1. at our regional offices, we'll be completely paperless for claims by mid 2018. a few months ago the veterans crisis line had a call rollover rate of more than 30%. today that rate is less than 13ers. we have launched a new predicted modeling reach investigate allowing v.a. to provide proactive support for veterans who are at higher risk for suicide. we're also launch agnew initiative this summer getting to zero to help end veteran suicide. this is my top clinical priority . to keep moving forward we need your help. we have identified over 1,000
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facilities either vacant or under-the-utilized and working now to move forward with 142 of those facilities and with your help we could do more of the same. we need congress to fund our i.t. modernization to keep our legacy systems from failing and to replace vista with the system already in use by the department of defense. this will ultimately put all patient data in one shared system enabling seamless care between the v.a. and d.o.d. without manual and electronic exchange reconciliation of data between except brat systems. we also need congress to authorize and overhaul our broken and failing claims appeals process. we have worked closely with v.s.o.'s and other stakeholders to draft a proposal to modernize the system and we're pleased to see the house unite behind the bill last month. now we just need the senate to act. most of all, we need congress to ensure the continued success of choice for veterans. veterans are responding to our modernization efforts by choosing v.a. more than before. to keep up with those choices, we need to fully fund choice
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and help us modernize and consolidate v.a. community care through the veterans care program. the veterans care program will coordinate care so veterans get the right care at the right time with the right provider, whether in a v.a. facility or from a high performing v.a. community care provider. we just need your help to make it happen, including funding to keep up with veterans as they choose v.a. thank you and we look forward to your questions today. chairman isakson: thank you, dr. shulkin. we appreciate your attendance today. i want to start off with my questions on the appeals process. i have consistently said that any change in the process to improve it must include an acceleration of and dealing with 70,000 veterans whose claims are pending today. would you agree? secretary shulkin: i would like to see that happen. chairman isakson: i'm going to give you a chance to make an amendment on that. if both appeal reform and budget requests are adopted in
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this budget, would v.a. be able to begin accelerating decisions for those 470,000 appeals pending? secretary shulkin: the appeals that are in the board of appeals are the one that is were most -- we're most concerned about. if the senate votes to move the appeals modernization forward, as i think you're saying, mr. chairman, we will have a process to expedite those from the time that the law passes moving forward. you're asking about the legacy claims and appeals. we do not have a plan to make signature progress on those. -- significant progress on those. the budget this year will add 142 more staff to the board. that will allow us to make incremental progress. i think to deal with the backlog we would be looking at 2026 before we dealt with the backlog. the one hope i have, mr. chairman, rather than adding a
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large number of staff to deal with the backlog, is that we'll give current veterans who are in the appeals process the option of opting into the new process. and if they choose to opt in, but it's going to have to be their choice, they would be able to have their appeal dealt with in the expedited fashion in the faster fashion. so that is my hope to be able to accelerate the backlog to encourage veterans who, unfortunately, right now would have to wait years to get decisions to opt into the new process. chairman isakson: first of all let me commend you. you just gave a patently honest answer to my question. not that i had expected anything else, but it's easy for a department head sometimes to talk department-ese, we think we heard one thing and heard something else. what i heard you say as far as those legacy appeals are concerned, this really is not going to do much even if it's adopted to take those claims and move them forward.
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which means we'll still have 470,000 veterans claims out there that -- one is 25 years old. eventually he'll die and get that one solved. we have 369,999 more. i'm going to quote now what i heard second hand, i'll say up front this is second hand, i've been told that the v.a. recently told the congressional budget office that v.a.'s plan is to, quote, very gradually, end quote, address the 470,000 legacy appeals if repeal reform is passed. is that the plan and how long will that take? i heard your answer being, yes, it's probably going to be very gradual and yes it would be 2026 before we got to it? secretary shulkin: yes. let me add, because we share that frustration, i find it difficult to tell people who have submitted into the appeals process they have six years to
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wait on average before getting a response. so i've asked the question, how much more would it take to get that backlog addressed? chairman isakson: and the answer is? secretary shulkin: i'm not sure you want to know, i was astounded. chairman isakson: i want to know. secretary shulkin: $800,000. chairman isakson: everything we do in the committee will pale in comparison to the hell we're going to catch if it's going to take $800,000,000 to handle those claims before 2026. the appeals -- we're going to clean up appeals prospectively in the future but for the legacy appeals to sit out there, they're going to still be out there. the anger is going to get louder and the frustration deeper. so we really need -- you need to know the number, and we need to
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be prepared to try to find somebody to to that. all that is going to happen, there are people going to get worse, more and more anguish, less an less service, it's going to cause more and more problems with the new programs we try to bring in place. thank you for being candid about that i want us all to be aware of what we're dealing with. we've got to make the hard decisions. one is to get the legacy claims done and not let them build up in the future. when you do put your new program that's going to solve all the problems prospectively, it better because if we fix the backlog but then they build up again, we're going to be madder than a hornet. i took too much time with that. when an american citizen signs up for the united states military and commits themselves to a period of service, carries out that service, and then meets the qualifications necessary for them to prequalify for v.a.
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health care in their retirement or when they leave the service. then we are obligated as a nation to pay for those benefits. is that not correct? secretary shulkin: that is correct. chairman isakson: anybody disagree with that? this is not a trick, by the way, i'm just trying to get everybody engage wesmed did choice, when senator sanders and senator mccain did a great job of leadership months ago on that we did choice to address the backlog, waiting time, things of that nature. we did some good things in it, brought about some problems which we have eliminate and have begun to solve. we're now in a situation and you alluded to it in your remarks where you need to find some money to finish out choice in this current budget period by moving some money from one part of the v.a. budget to the other. i want to make sure, you have seven accounts to fund health care benefits, is that correct?
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secretary shulkin: community care. chairman isakson: but seven accounts. one of those is choice, one is community care. so when you ask to move that money to -- so you have enough money, you're not asking for new money to be given to you by appropriators or by congress, you're asking to move existing appropriated money for health care benefits under one stovepipe in the v.a. to another stovepipe to achee balance but it's no new appropriation. secretary shulkin: that is correct. we have enough money to be able to make sure that all veterans will get the care they need. we need your your help to figure out the best solution about how to get more money into the choice account. chairman isakson: and i'm raising this only as a good talking point for all of us on the committee to have a discussion, which i'm sure we will have on this, but i want to get to that point also but we get bogged down sometimes in legispeak, words like mandatory,
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discretionary this acronym that acronym, when it's all the same money. it's for veterans' health care benefits. it's in your current appropriations. it's not any new money. we're not raising expenditures of the taxpayers, we're just trying to meet our only fwations to our veterans. with knee toad find a way to do that, not just on a stopgap measure but permanent. one of those ways may be to see to it that all veterans' benefits are paid out of one account. is that not correct? >> that would make sense to me, mr. chairman. >> senator tester. >> thank you, mr. chairman. hank you, dr. shulkin. you talked in your opening statement about choice being down to $ 21 million and the fact that there was adegreesal dollars in community care and you wanned to transfer it. senator tester: you pulled out a rule, edict, i don't know what you want to call it, what do you
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call it? directive. that's it. you want to go to the intentional intent on choice that would dry up a lot of how the dollars were spent. then a day or two letter you rescinded that, thank you for the breakfast yesterday, we had a great breakfast, we talked yesterday about potentially doing a fix legislatively. i was told today that another directive was put out today that reinstated that rule to go back to the initial, is that correct? secretary shulkin: let me try to be accurate about what happened. we noticed that there was a imbalance in our two checking accounts. on friday we sent out a directive saying stop spending from this account, ok, start spending from this account. we were afraid after seing that directive that we were going to confuse the field and so we rescinded that.
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the field, once we rescinded the memo said, ok, we get it, you're rescinding the memo but give us some direction about how to spend out of both of these accounts because we do still have money in the choice account and more money in community care. we sent out four principles about the appropriate use of choice and the appropriate use of community care. while we're working with you to figure out the best solution about how to get the appropriate money in each of those checking accounts. senator tester: did those four principles -- i don't have a problem here, all i want is predictability. did those four principles tell folks to go back to the original use of choice? secretary shulkin: it told them to use choice for the appropriates you of choice which is clearly as you legislated, 40 mills, 30 days, and to use community care for the original use they were using it for. senator tester: so with all due
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respect, the direct i was put back in place. and by the way, i don't have a problem with the first directive. i don't have a problem with staying the way it was. it's got to be driving your folks on the ground an it's going to be driving our veterans crazy if it's yes, no, yes. and then in a week when we fix this it'll be no again. and so that's all i ask. in that uncertainty, by the way, and i won't speak for everybody on the committee but i've got a notion it will be this way for everybody on the committee, does not add confidence to the v.a. moving forward. i'll just tell you. so you get my drift? secretary shulkin: absolutely. let me just say, i would not disagree or argue with you. the choice program has been difficult to administer, difficult to understand, and very complex. we -- the first memo was resinned and -- what id state is
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do not go to choice. we do not mean that. what we tried to to is provide guidance to say, you can use choice and we want you to use choice appropriately, but we had community care funds we want you to use those. we understand but it's different than the first memo. senator tester: i would just say this. communication is a very good thing. we need to have communication. the breakfast we had yesterday was very, very important. i think everybody at this breakfast would agree, hopefully we can do more of it. there was no indication of this happening at the breakfast yesterday or we could have discussed it more. and i don't want to micromanage the v.a., that's your baby, you'd hang me out to dry if i did that. by the way, i want to say we, the committee, but more importantly the people sitting ehind you, need that
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predictability. i have more questions but i'll defer to the next person. senator moran: i'm in a position of agreing with senator tester and disagreing with senator tester. the memos are difference. when we visited about the first memo, the cons again of that would be the third party administrators would have no role to play in the networks -- and the networks could potentially go away, lie dormant. and so the second memo says choice is alive and well. secretary shulkin: absolutely. senator moran: and it's to be used in this these circumstances, the ones defined in the original choice act. i don't actually know what that -- how that's different than how it's being used. how is choice being used different than 40 miles in 30 days? secretary shulkin: we were also putting everything we could through choice, especially services that weren't being offered at the v.a. so senator moran, you have it
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correct. that's what we tried to do between the first and second. senator tester is pointing out we have some work to do in etting our communications. senator moran: that's where i was going to agree with him. i would make the case on behalf of senator tester that we had a hearing on wednesday on choice. your first memo goes out on thursday or friday and this conversation never occurred with people who care a lot about choice but care a lot about -- secretary shulkin: i will say. everything that both you said is accurate. i'll tell you, and i hope that u -- i will tell you that, look, my integrity is very important. on wednesday, senator, i did not know this information. i learned about it on thursday. senator moran: i assumed that was the case. ship thank you. senator moran: let me try to highlight why keeping choice in existence, and it's not a matter
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of transferring money, or what pot of money it comes from, is an important issue. that revolves around whether or not choice has a future today and then when we potentially re-authorize its existence into the future. when i say that it matters because if choice isn't being used in our interimmediate -- and our entire immediatearies en't being paid, the network -- and our intermediaries aren't being paid, the notework is not -- there are no third party intermediaries. it's not just a matter of transferring money back an forth. it's a matter of making sure choice is viable so the network stays in place. does that make sense? secretary shulkin: yes. and we worked hard to do that and we want to keep that in place. senator moran: a part of this i'm still confused about, because your response in regard to chairman isakson was we need transfer authority. i certainly have been in these
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hearings enough to know you've said that more than once. it makes no sense to have unneeded barriers. but we also need to make certain that this issue of mandatory is handled in a way that again choice is mandatory and that money has to stay viable, available so that the program stays viable. here's what i wonder is that just -- and again in response to the chairman, i think you said we're not asking for any new money. my understanding is that you have about $2 billion in the community care account. is that an accurate number? ship unobligated, yes. -- secretary shulkin: unobligated, yes. senator moran: so at some point in time that money becomes scarce. it can only last so long before both the choice account and the community care account are both insufficient to meet the needs through community care. secretary shulkin: we have enough money to get us through
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the end of the fiscal year. if we could balance the accounts correctly we could make it through to the end of the year to get community care paid for in both choice and internal community care. senator moran: so the $2.9 billion in the 2018 budget request is not needed until f.y. 2018. secretary shulkin: i'll defer to my c.f.o. but i'm going to say yes. >> yes, sir, that's for next year. the caveat is we assume we're carrying over $626 million of this year's choice money into next year. our actual requirement for 2018 is $3.5, we're going to consume that before the end of this year so we'll have a hole next year of $600 million. senator moran: and that's mandatory dollars, not discretionary dollars. >> yes, sir. senator moran: so we have to authorize additional mandatory spending for whatever the
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account has been called. >> yes, sir, unless we find some other offset in our appropriated funds. senator moran: assuming your budget numbers are right, that there is no emergency is what you're telling us that choice will went -- will continue between now and the end of the fiscal year without additional input of money as long as there's a transfer of, i suppose it's discretionary spending into he the mandatory account. is that true? >> the last part you said is true but if there's no action at all by congress then the choice program will dry up by mid august. senator moran: and you have no ability in your view to fix the transfer issue, the discretionary, mandatory two components to combine those into an account without legislative authorization. so the emergency is not more money. the emergency is changing the
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law to allow you to spend money that you have, although it certainly sounds like it creates a likelihood of fiscal shortfall, dollar shortfall in f.y. 2018 even if we appropriate the $2.9 billion in the president's request. secretary shulkin: i think everything you said is correct and as mr. yow said, we are not seeking, though, additional moneys. if we needed to, we will identify the offset to the $600 illion for 2018. senator moran: he chairman -- the chairman has his finger on the -- i've had my fair shot. chairman isakson: i'm a veteran, served in the military in fghanistan, served my years to necessarily make me el visible -- eligible for v.a. health care. if i go to the v.a. hospital for
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a medical need related to my service, or to just regular health care, you're obligated as head of the v.a. to pay for it and deliver that health care to me in the best possible way possible, am i right? secretary shulkin: yes. chairman isakson: so you don't have discretion as head of the v.a. to not provide me with health care because you didn't get enough money. you have the obligation to manage the money you have. secretary shulkin: yes. chairman isakson: that's why when we talk about mandatory and discretionary, i don't think it's a matter of discretion, if the v.a. is at risk of not having enough money we have to find that money. what you're talking about in transferability is after we decide to put x number of dollars in however many accounts it is that are in the v.a., you want to be able to take money out of those accounts to pay for the benefit of that veteran without it having to go to a secondary step within the v.a. to get money remove -- get money
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moved by somebody else because something is named mandatory or named discretionary. secretary shulkin: yes. chairman isakson: i wanted to make sure i had that right. not sure i said it right but it's clear to me now, clear as mud. senator sanders: on page 3 of your testimony you point out, i think what most veterans organizations know, by and large the v.a. is a pretty good health care system. and you quote a study published by the journal of the american medical association where researchers compared hospital level quality care on 129 v.a. hospitals with over 4,000 nonv.a. hospitals and you found that that the -- better outcomes in the v.a. on 6-9 patient safety indicators and the other three were about the same.
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that's pretty good. that speaks pretty well for the system you're running despite all the criticism we hear every day. >> yes, sir. senator sanders: let me ask you a question that's always fascinated me, maybe you can give me an answer. i held a hearing talking about preventable deaths in american hospitals. i'm looking at an article now in the new england journal of medicine, and they say that hospitaled me kohl errors are the third leading cause of death in the united states. 700 people every single day die in this country from hospital medical errors. how is the v.a. doing compared to non-v.a. hospitals on that issue? secretary shulkin: well, as the article in jama suggested, the v.a. is performing bet own patient safety and patient safety is defined by medical errors, than on average the private sector. of course every hospital in america, including v.a. is
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always looking for ways to get better but the v.a. has systems in place that help it perform better than many of the private sector hospitals. senator sanders: congratulations for that. i know the veterans appreciate that. which takes me to the point senator tester made a moment ago. and that is what we hear every time there is a hearing with veterans, they like v.a. health care. what i do not want to see and i think senator tester and many of us do not want to see is shifting of funds that go to traditional v.a. health care to the choice program. the choice program, we've had a long discussion, we'll continue to discuss that. i am a little distressed that a significant amount of money in president trump's budget is going to choice, not quite so much going to traditional v.a. other question. you mention on page 9 what is obvious, you say that v.h.a. is the largest health care system
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in the u.s. and in an industry where there is a national shortage of health care providers, we have a major doctors crisis, especially in certain areas, primary health are, maybe psychiatry, psychology? secretary shulkin: those are the two biggest. senator sanders: a couple of years ago when i helped work on the major veterans bill, we expanded a program for medical education. it was the section 302 of the health professionals educational system program. what that does essentially mr. chairman is, what it does is help, as you know, medical schools are outrageously expensive. which is a serious problem. i talked to young doctors who are $300,000, $400,000 in debt. they're not going to go work at the v.a., they're going to go work where the money is. i would like to see that program expand. tissue expanded. what it does is provide debt
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forgiveness. work for the v.a. for x number of years, we will forgive the debt you incurred in medical school. is that an idea that makes sense to you? secretary shulkin: senator sanders, both of the ideas that you said and the ranking member talked about make a great deal of sense to me. i do not want to see v.a. care diluted because we're get manager veteran into the community. i want to see more veterans in the community because they need the care and v.a. can't provide it right now. what we're proposing and hoping to work with you in this new choice program are the two things you've talked about. right now we're restricted to 1% transfer from care in the community back into the v.a. or vice versa. we'd like to see that aperture opened so that we could take money that was in the budget for sending veterans out and reinvesting more of it into the v.a. we think that's important. it should be done at the local level when every local division
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makes its determination of what services need to strengthen. on the education, i couldn't agree with you more. the program you were helpful in rafting was a great success. senator sander: is it working well? secretary shulkin: it is. we are proposing exactly what you're saying. create manager g.m.e. spots, the country needs them. v.a. would pay for them. in exchange it would be like the military public health service. afterwards they would give five years back to v.a. senator sanders: this is an issue where i think we can go a long way in attracting excellent physicians and nurses, perhaps, into the v.a. by doing -- expanding this edebt forgiveness program which i understand is working well. i would look forward to working with you on that. last question. i'm yet quoting from a publication called "families u.s.a.." cutting medicaid would hurt
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veterans, efforts in congress to cut medicaid jeopardize a critical source of health coverage for veterans. approximately 1.75 million veterans, nearly one in 10, have medicaid as a source of coverage. if republican health care plan goes through, and i'm going to do everything i can to see that it doesn't, but if it does go through and medicaid is cut by other $800 billion in a 10-year period, i assume that means a lot more veterans will be blocking to the v.a. m i correct on that? secretary shulkin: i would think so. we are a safety net organization. we have veterans without other access to come to the v.a. i don't want to sound like a politician but as the chairman said, our role is to provide that care. senator sanders: if somebody lost their medicaid they'd turn to the v.a. and you'd need additional help to accommodate that large number of veterans? secretary shulkin: yes.
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enator sanders: thank you. chairman isakson: thank you, enator sanders, senator rouns. >> last time we had a discussion about the emergency care fairness act. under the 2018 budget proposal a line to pay for that is still lacking. the v.s.o.'s independent budget included a recommendation for $1 billion for 018. i guess my question would be what is the status of the appeal, the appeal on the emergency care fairness act the way that it is being interpreted and at what point will the v.a. formally request the necessary funds to pay for the emergency care for our veterans? secretary shulkin: first of all, senator, i appreciated the interchange that you and i had. i think that it -- you were making excellent points and you
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were actually on the right side of this issue. we have done two things since we talked last. first, we have completed all the regulations to be table move forward with payment of the staub claims and we have now transmitted them to the office of management and budget. so that part is complete. so that's moving forward. >> that's good news. secretary shulkin: the second thing is that after considering what you said and also, i think, senator blumenthal, i have decided to voluntarily withdraw the appeal to the staub case. >> that's great news, mr. secretary. i think what that means then is, the last time we checked there were 370,000 claims outstanding that now can expect to receive payment for the emergency room care that they have expected since 2010. secretary shulkin: we still have to go through the rule making process. that's why we transmitted those rules to o.m.b. they need to go
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through the process. i don't want to set time expectations but yes, we are moving in that direction to adhere to the judge's ruling on this. senator rounds: that's a positive development. for those 370,000 individuals this is great news. any possibility of expediting hat rule making process? secretary shulkin: we did, we got the rules over there very fast, we will encourage the administration to be supportive of that senator rounds: i can't tell you how glad i am to hear that. i'm glad you've taken the tame to get personally involved in the issue. that's what veterans want to see coming from the v.a., focus on what the veterans need what the veteran's care should be. then when we make a promise, we honor that promise. i think that's what veterans are expecting from the v.a. and i think this is a major first step in that. thank you very, very much for
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your work on it. your attention to this. and i think that will pay dividends for the entire organization for years to come. so thank you. mr. chairman, i yield back time. chairman isakson: thank you, senator. senator manchin. senator manchin: you announced you'd be scrapping the electronic record system and using the same one that the d.o.d. system uses. whime isle -- while i'm in favor of making it easier to transfer from d.o.d. to v.a., my concern is that it will have effects that could be detrimental. here's where they are, and my question is, are you concerned there will be increased risk in having one company manage these records? what if cerner becomes the healthnet of electronic health
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records? secretary shulkin: i think in making a decision of this magnitude, there are risks involved with it. i have to tell you, i thought the risks were greater to do nothing. that considering the maintenance required on vista, the expense that will be required, and the lack of ability to maintain qualified software developers within v.a., the risk of doing nothing was worse. i think that d.o.d. went through to a strong due diligence process. i think they selected a stable platform. we have benefited a lot from their due diligence and expertise and that was one of the reasons why i went in that direction. there's always a risk, senator, especially when you transfer systems. so -- senator manchin: i have two more parts to to this. how do you guarantee cerner is
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not taking the v.a. for a little bit of a ride? secretary shulkin: all i've done is start negotiations. i have not committed to anything -- senator manchin: how do you know the price is competitive if you don't have anything to compare it to. secretary shulkin: we know the price d.o.d. paid and the price we are paying to maintain our current systems and we'll be seeking the best way to do this for taxpayers. the cost of a transfer of system is actually in internal change management not in software licensing. senator man chin: it's not in your budget right now, how will you absorb the cost? secretary shulkin: we have to go to the appropriators and lay out a plan so they can decide whether they believe this is also a good decision. senator man chin: this hearing is about care and community, while ensuring records transfer between d.o.d. and v.a., we must
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make sure that records transfer between v.a. and non-v.a. providers. will serner be undertaking that as well? secretary shulkin: yeah, what i've said in the decision is that while it is a decision to move forward with the a common platform with d.o.d. this will not be the d.o.d. system. v.a.'s needs are much different in that we have to be interoperable with our community partners. and many, many, in fact, 880% of our community partners are not necessarily on the cerner platform. we are going to have to create a system that does several things the d.o.d. didn't. we're not going to be scrapping vista. we're going to have to connect into and maintain our 30-year database and we're going to have to be interoperable with community partners. senator manchin: i have one more and a real quick question. there's no assistant secretary
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for i.t. or secretary for health? how are you undertaking this? secretary shulkin: we have competent people in those roles. senator man chin: you feel you have a person that will do it? secretary shulkin: i feel we have competent acting people but i need permanent people in those roles soon. senator manchin: my final question is about the opioid epidemic, which is the number one problem in my state, my district, with v.a. and nonv.a. i'm looking for assurances that when we do a new -- when we do new provider agreements with nonv.a. care prode providers we're making sure they understand we won't tolerate the overprescrippingts of on yats. we have a lot of pill mills. they get these people hooked and keep them hooked. what's your oversight? are you prepared for this?
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secretary shulkin: i don't think we're doing a good enough job in this. i think the country needs to do better. nator manchin: we have problems throughout the v.a., you have been working on this. you have no control outside. secretary shulkin: we monitor patterns of prescribing. i have the concern about going out to the community that you have. senator manchin: if i'm a non-v.a. provider, a new act lets that person come to me, i contract with the v.a. to take care of these people is there conditions on that if i prescribe -- do i have to follow prescription guidelines? will you be monitoring that as far as the on yat prescription guidelines? secretary shulkin: today there are not those requirements. i think this is a good area to come back to you with our thoughts on this
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senator manchin: we need your help on this. thank you. chairman isakson: senator. >> i want to talk about the budget for a minute if i may. i want to talk about the individual unemployability cap. can you explain the rationale of what went through the thought process that went through this? >> secretary shulkin: senator heller, my starting point is that we always have to do better for our veterans. we have to deliver on our commitments that we have to our veterans. the president's budget includes significant increases in both discretionary and mandatory funds and makes choice a permanent part of funding, but we have a responsibility to use our current funds in a way that makes sense, best for veterans and taxpayers. o we propose a part of the process that would revise the
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individual unemployability benefit. the intudget a process. this was part of a menu of opportunities. that we had for thinking how we could make the budget process better. as i began to listen to veterans those in concerns and particular, it was clear this would be hurting veterans and would hurt veterans who cannot afford to have those benefits taken away. i'm concerned about that. what i would like to say is this is part of a process. we have to looking at ways to do things better. i'm not going to support policies that hurt veterans. so i would look forward to working with you and all the members of the committee on figuring out how we can do this better. we have budget numbers and targets we have to hit but we shouldn't be doing things that are going to be hurting veterans that can't afford to lose these benefits.
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>> i appreciate hearing that. do you know how many veterans would have been affected by this change? secretary shulkin: we have 300,000. >> there are 330,000 in receipt of i.u. about 200,000 of those are under the edge of 60 and would have been affected. senator heller: it would have been retroact snive >> it would have been point forward but to include all veterans in receipt of i.u. i don't believe we'd pull benefits we distributed back -- senator heller: but if you had the benefit you could lose the benefit you're receiving. >> correct. secretary shulkin: that was the proposal. but we do look forward to working with you to figure out how to do this better. senator heller: i appreciate your concern, but do you know what the average is per veteran, the average intake per veteran? >> average payment? roughly $1,600.
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that's on top of you have to be rated between 60% to 100% and it takes you to tampa rare 100%. 16% is -- 60% is roughly $1,600. senator heller: you can understand the financial burden it may pose for an individual. what i'm most concernened about is the long-term retirement testimony they may have not prepared or been prepared if -- in believing that that $1,600 may be there. secretary shulkin: i think that's the issue. this is why we had identified this as an opportunity. i think if we were designing the system from the beginning, we wouldn't have used unemployment insurance to fund people's retirement. i think that was the conflict. but the end result is, that is the benefit. to withdraw this benefit from people who rely on that money is something that would be very difficult to do. senator heller: i appreciate the concern. can i change topics for a minute
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and make sure i understood this correctly. did you say you had a decision-ready claim in three days? secretary shulkin: we've had 12 of them so far, i think. 1 we'll s -- september p roll that out across the country. that's big news. senator heller: i'm glad. i've been working with this issue for years. to think you could turn one around in three days is pretty incredible. >> that is a big deal and we're piloting in st. paul right now and again with a couple of our v.s.o.'s and if the v.s.o. brings in the claim ready to be decide, no further development, we decide the claim. senator heller: we had a previous secretary say he could get the claim downs tosore by, i think it was 2015. what's the status now? if this works as well -- secretary shulkin: i can tell you i won't say that. no. senator heller: no predictions.
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secretary shulkin: no. about ht now, we're at 90,000. >> as of this morning, 94,000. senator heller: that's what i have, about 1,200 in nevada. secretary shulkin: i think our goal, jamie, is by the end of the kallen tar year to about 70,000? >> that's right. secretary shulkin: but these decision-ready claims, we think will take 10 to 15% of them off. so we won't start rolling them out until september but that will begin to whittle that down and we hope in two years to be down below, around half of where we are now. senator heller: ok, ok. thank you for the time. chairman isakson: thank you. senator murray. senator murray: thank you, mr. chairman. thank you for being here. secretary shulkin in last year's budget request, the v.a. estimated it would need $725 million in 2017 and $840 million
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in 018 for the veterans caregiver program. yet in the first budget of the trump administration you plan to use only $521 million in 2017 and $624 million in 2018. those are cuts of about 30%. meanwhile i'm hearing from so many of my constituents, as i'm sure everybody is, of care givers being crop dropped from the program with no explanation and no justification and an investigation by npr found the charleston medical center dropped 94% of its care givers, 83% ins prescot, arizona, and 83% in agus ta, georgia. it seems to me, watching this, that this is just another way the administration is balancing its budget on the backs of the veterans in need. how do you explain those numbers? secretary shulkin: let's talk about three things quickly that you said. what was reported on in charleston, completely unacceptable. 94% revocation of caregiver
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benefits, unacceptable. that's why we suspended the program. today there are no revocations across the country going on until we get the guidelines better understood and better -- in better shape. senator murray: that's the freeze you're talk about? that's only a temporary measure? secretary shulkin: it's a temporary measure until we revise policy. i will not accept giving benefits and then taking 94% of them away. that's ridiculous. sec thing is, is that on the right amount of money to request , we only spent, even though $750 million was in the budget we only spent $521 million. so in budget planning for next year, they requested $600 million. ok. which is a modest increase from where we are. our hope, as you know, and you've been a tires readvocate for this, is to expand caregiver benefits and we do plan on
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working with you with that. but we hope by expanding caregiver benefits, particularly to older veterans, which today aren't getting the benefit the way they should, that we actually find that that's going to be cost effective because remember, we pay for long-term care. so my plan is to be responsible to taxpayers. i am going to seek to expand caregiver benefits to older veterans but i'm going to pay for it myself without asking the axpayers to increase the bill. senator murray: the chair and i wrote to you about this, i would like to see the freeze extended until all the issues in that letter are discussed. can you do that? secretary shulkin: do you have the date of that letter? senator murray: about two months ago. secretary shulkin: absolutely. secretary shulkin: i know you --
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senator murray: i know you wrote to triwest and others to return money for veterans wait for care. secretary shulkin: when they can't appoint an appointment within a period of time we ask them to return it. they're returning large numbers oto us. do you know, mark? >> i don't. secretary shulkin: this is a -- ongoing process. before they would just wait until it took weeks and weeks to give an appointment. we said if you can't give an appointment within five business days for a routine appointment, return them to the v.a. so we can take care of the veteran. t's a big percent we get back. senator murray: do you know how long care will be delayed by that? secretary shulkin: this is speeding up care. rather than let them sit out there, they return them to the v.a. and the v.a. community goes out and tries to find an
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appointment. senator maury: i'm concerned about where the money is dwing to come from there. there seems to be two different stories here. transfer authority is what i'm hearing from this year, correct? well if you transfer money from this year, then what you're doing is impacting what you thought was going to be the carryover from next year. won't you need additional money rom next year? secretary shulkin: the problem with having two separate checking accounts and knowing where you need the money is frankly impossible. that's why we want to work to get it into a single community care account. these guys will help make the best decisions possible. mr. yow will help us understand the right amount to transfer. senator murray: it will impact 2018. we can't do our job unless we know what the costs are. i'm hairing from veterans in
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himy state about the delays and burdens they're seeing. i have veterans in walla walla being told they have to drive eight hours round trip to portland or seattle for an imaging test as a result of this. i'm hearing more. this is having an impact. i want you to know that. we want to know where this money is coming from and so we will follow up with you on that. i think this committee needs to be aware of that. secretary shulkin: ok. senator murray: i'm running out of time, i'm way over time, i have other questions, mr. chairman, and i will submit them for the record but i am deeply concerned about that chairman isakson: listening to all these questions about checking accounts and authorities reminds me of the question i was asked yesterday on my 49th wedding anniversary, somebody asked my wife and i what we attribute 49 years ago, i said we never had a joint checking account both of us had to sign. let's don't ever get into that
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situation. senator boozman. senator boozman: thank you for being here. senator sanders talked to you about the problem with the fact of providers. and so many people are at the age now where big group of baby boomers that are aging out. they practice because they like and medicine has gotten more complicated and stuff. i think we'll see a bunch of those actually decide to do something else. or not do anything. the idea of increasing, well, first of all, i agree the fact that we can reward people for going in is a great idea. i think it actually would work and i think we have good evidence of that. the problem is is actually creating new slots versus taking slots away. you know, for veterans. so if you could work with some of your counterparts in the v.a.
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-- and the v.a. is a huge entity,s that huge problem for the country, besides the v.a. if you could craft a situation where you can actually increase the medical school classes and also the residencies, which are a huge problem too, that would be a great deal. with your relationship v.a. with the teaching hospitals, i think that could be done. it's going to take some work. but that truly could be a great legacy. secretary shulkin: we're focused on residency spots. the medical schools have actually increased the number of medical school spots because they have tuition that pays for it. it's in their benefit. the residency spots, as you know are capped by medicare. what you did in the choice program that senator sanders helped lead was expand those graduate medical education spots. that's what we need desperately. senator boozman: very much so. we need to do whatever it takes or we'll get ourselveses in trouble.
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.4 -- $.4 billion in mental health. mental health improved so much in the v.a. in the last years. we're not at the point now where we're just writing prescriptions like so many providers, not just in the v.a. but throughout the country, giving prescription and that simply doesn't work. on the other hand, you know, there's -- we need to go further. how are we going to prioritize that 6% as far as increasing our ability to provide good care? secretary shulkin: we've targeted to hire a thousand mental health professionals. we're seeing 5 ,000 more mental health appointments than we did last year at this time. we're expanding our telemeantal health programs, we just as you know this past year have given full practice authority to our advance practice nurses. many of them will be putting their skills to work in behavioral health. and you know, ex-panning the training. as senator sanders said, psychiatry and psychology and nursing are all areas of
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shortage we can use more help in, not only in the v.a. but the entire country, quite frankly. so we need to do a lot more. i think you're right. we have prioritized mental health. but it's an area that needs a lot more help. senator boozman: you talked about the core mission of the v.a. the foundational services with the v.a. can you walk us through those or what you feel like is -- secretary shulkin: these are the services that make me so strongly believe that a strong c.: -- a strong v.a. is essential for veterans the country. i believe that without the types of services the v.a. provides, you can't find those in the private sector. if we turn our veterans other to the private sector they'd really be lost. these are services that veterans ve a high predlix for --
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redilection for, brain injury, poli trauma, ornotics, comprehensive primary care and behavioral services are clearly foundational as well. environmental exposures. blind rehab. i don't want to leave out a group because i know aisle offend them. but these are things the v.a. does extraordinarily well that you would not find easily except in very specialized geographies where there are centers of excellence. it's important we keep those trong. senator boozman: you talked about community care and how doctors will make decisions on providing care in v.a. facilities versus in the community due to clinical need and what's best for the veteran. how do you do this? how to you make sure that, you know, we have an institution, you know, we have a bureaucracy, how do you make sure those decisions are based on what's
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best for the veterans as opposed to what's best for the facility? secretary shulkin: i think -- i wish there was an easy answer to that. what we have to do as an organization is get out of the way of the doctor and the provider making those decisions together. so we need to get rid of the administrative roles an the third parties in between. that's what ewith -- that's what we saw in the choice program. we were having veterans call call centers of people who didn't know them and that was frustrating the veterans. so what we've learned is, de-layer the process, get it back into the exam room or in more modern term, the telemonitors, but let the doctor, the patient, the provider, the patient, make the decisions that -- together in a partnership about what's best for them. that's the system we're trying to design now.
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senator bozeman: thank you, mr. chairman. chairman isakson: senator till liss. senator till liss: i'm going to be married 30 years two weeks from today. we have a slightly different approach to longevity. we have a joint account, i just don't have access to it. chairman isakson: that works also. senator till liss: i'm not even going a allowed to go out of network for an t.a. -- an a.t.m. withdrawal. i'm running between committee, we have an aging committee going on right now, talking about supporting care givers, the hidden heroes project that senator dolede is heading up, that's critically important. i won't spend time talking about it here, but one thing that was striking in the opening system was the fact fa there's about $14 billion a year in care giving being donated by these husbands and wifes and sons and daughters that we need to find a way to provide support over time. i understand that in order for us to do that, we have to talk about the resources and make
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sure we're not shifting our attention away from so many other pressing things but it is something i look forward to talking about in a future hearing. dr. shulkin, i want to know how we're doing. some of the uncertainty with accounts and how much we need in one or the other, one thing, it's a fluid situation based on factors that are different across the country. another one may have to do with having the right resources in place so you can actually get to that information pretty quickly. how are we doing on getting your, i understand the c.i.o. nominee has withdrawn their name from consideration. how are we doing on trying to get that administration stacked up so you've got a good organization, permanent organization under you? secretary shulkin: not only the c.i.o. but the c.f.o. candidate. if we're attracting a good viewing audience, we need help. we need people to want to come and help us. senator till liss: and having a
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perm the -- senator till liss: and having a permanent -- a tor tillis: having permanent c.f.o. will help with budgeting. we've got to get those positions filled. i think it's one of the ways we get back on track for the transformation effort. the -- i'm not going to spend much more time. i'm going to bet back -- get back to the other committee. but i'm going to echo again what i said in the last committee. i'm sure there are various factors that led to the shortfall in one account versus another. but there are probably other things we need to do to make sure we're facilitating the process and not giving you additional distractions or uncertainty as you go through the financial planning. please, speak candidly to the committee members to make sure there are things we can do or shouldn't do getting in the way of you getting us definitive answers. i also want to reiterate what -- senator murray made several good
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points, i agree with all of them. i think she's right, the sooner you articulate what your funding levels are, the better so we can go and be advocates for it. secretary shulkin: thank you. senator tillis: thank you, mr. chairman. chairman isakson: senator blumenthal. senator blumen that'll: i want to express my appreciation on the stuab versus mcdonald, i join my colleague, senator rounds , in expressing my appreciation for your decision to withdraw the appeal and also join with him in asking for a quick rule making which i know you will do. on the v.a. vocational rehabilitation employment program, as you know, it provides career counseling and services to those with service-related disabilities to overcome employment barriers and
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assists with post-secondary education at training institutions. aye been told by connecticut university that there are delays in vocational rehab housing and ucation payments for service disabled veterans. the v.a. has previously attributed those delays to lack of vocational rehabilitation. those at the hartford rehabilitational office staffing shortage theshes v.a.'s purported goal ratio of vocational rehab counselor to lient is one counselor per 125 veterans. but the average ratio in july of 2015 i'm told was one counselor to every 139 veterans. with the payment delays and the inability to meet the ratio, the f.y. 2018 budget cuts to this
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program for patient rehabilitation is $13.8 million. you're probably more familiar with those nurems than i am, i apologize for telling you something you already know. this decrease in requested funding seems unacceptable, particularly for those of us in connecticut who see the results already of underfunding and i'd like to know whether you plan to delay, to address the delays, apparent iew of the underfunding of this very valuable program. secretary shulkin: senator, first of all, thank you for your outspoken leadership on the staub case. in terms of vocational rehab and education, we may have different numbers so i'd like to go over with you. we see a $1.5 million increase
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in the president's budget for hese programs. there are some staffing issues and delays in the hartford region that we do want to get improved and we do want to fix. but we think this is an important program. we believe in it, we believe the president's budget adequately funds it but if you have different numbers and we're wrong, we will want to address that. senator blumen thaul: i would like my staff perhaps to get i ether with you all but think the overriding issue here is not necessarily even the numbers, because even if there is a slight increase, the program is so valuable it ought to be a major increase, certainly not a reduction. and again this is not a criticism of the v.a. in fact, on the contrary, it's saying you're doing great work. we want to -- we don't want to see it diminished. we see these delays in hartford
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and we'd like your help. secretary shulkin: we'll follow up with you. senator blumenthal: i don't know whether it's been asked about but i wonder if i could ask ain about the veterans benefits administration, whether you see real progress in reducing the claims black log, i'm guessing someone has asked already. secretary shulkin: not a problem. senator blumenthal: what's youring prodemow sis? secretary shulkin: we're at 94,000 right now. by the end of the year we hope to be at 70,000 and a year from that, or two years from now, below half the level so 45,000. we just announced that we've done 12 claims so far in three
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days, called decision-ready claims. we're going to roll that that will impact 10% to 15% of our claims. all the information is ready to present and give a decision in three days. we are making some progress. we are trying tore actually look at some break-through ways to do better, but as of today, i have given you the most accurate information we have. mr. blum: the progress that you're make -- is it more resources or a combination? secretary shulkin: the budget stays flat. so it's not necessarily, but they have added in the past couple of years. the major process is major improvements and something
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called the national work queue and therefore you can distribute the workload across the country and enhanced the productivity standards for the people and they have done a terrific job and great staff who are up to the challenge and seeing improvements. so mostly process improvements but they have added to their staff. senator: i want to thank you and know this is a problem that has delve us over many years and i'm glad you are making those process changes and made some break-through changes in the foreseeable future. thank you. >> i have been asked by senator sanders and senator tester to
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make brief statements. i recognize for their requests and statements. test test the v.s.o. we want to hear from next. i have heard it over and over again. i have been in public lifelong enough to know you want to know where things are headed, you follow the money and the fact that we have 1.2% increase for in-house medical care and 3.2% out-house medical care is disturbing. you said don't worry about this, jon, we are going to make the v.a. and the v.a. is going to fill in the gaps. we are going to hear from a panel of v.s.o.'s and talk about v.a. care and talk about other ways we can fix it.
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number two, this is an authorization committee. i.t. funding, you have $200 million in this budget, you should be asking this committee to plus this budget up and you need to do it so it represents the money you will be dumping out for the d.o.d., and platform we support you doing. and it is important that we are honest with ourselves. i happen to be on both companies and i don't want to get nailed and say the authorization committee didn't do that and these spend-thrift appropriators are dumping money in. we need a budget that accurately reflects. and this i.t. is going to cost will have carlwe blake and others up here in a
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second. and i want to thank those guys for their service. we need to take our direction from the v.s.o.'s. i will try to get back before the end and need to take the direction from the veterans. secretary shulkin: the one thing is we are always clear on where you stand and appreciate that. i do want to work with either you or your staff. because we have different numbers than you have in terms of the community care and internal care and you know, we have an interest in making sure the v.a. is the best system. the ability to transfer more -- right now we are limited at 1%, would help us a great deal and we'll continue to work with you on. senator: we are going to work with you. as i said to you, you can
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outsource but can't outsource responsibility. senator sanders: i want to touch on what is a terrible national risis and that is the opioid epidemic. they were criticized for overdependence on opioids. i know there have been significant changes and i am pleased to go to v.a. hospitals around the country and see programs regarding complementary, yoga, nutrition and so forth and so on. can you say a word about how the v.a. can lead this country away from opioids, although sometimes they are necessary into less type of dependent drug approaches? secretary shulkin: i'll try to do it briefly. but i published an article on
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this four, five months in the journal of the american medical association about the v.a.'s approach because i think it is a national example that others can learn from. we started this work in 2010 where we identified problems before the rest of america did as the v.a. often does and did this through a different approach. we monitor the patterns of all of our providers and give them feedback. senator sanders: if they are overprescribed. secretary shulkin: pharmacists go out and teach our providers the ways to use open oids appropriately. we have our patients sign informed and consent and part of the process when they get an opioid. we participate in the state prescription data monitoring programs. it is mandatory. and we are providing
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alternatives such as you said complementary care. the best practice for us is white river junction, where we have a 50% reduction in opioids se using those techniques. and we are doing in white river junction and working in a number of these areas and trying to work on research with the f.d.a. as onaddictive nonnarcotics well.
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senator isakson: let me thank the secretary. we are grateful. let me welcome our second panel and i'll begin with the introductions, mr. carl blake, government relations.
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mr. acosta, disabled american veterans. director of legislative services, vietnam veterans of foreign wars, vietnam veterans of america. each recognized for five minutes. >> we would like to submit our report. ar 2018 budget i would like to talk about what is included in our budget report. i appreciate senator heller bringing up the question about i.u. although i would say it's not readily apparent that the v.a. said it is going to drop that proposal, sounds like the secretary is willing to discuss it further.
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i appreciate senator mampin and ester about the e.r. modernization. senator round continues to beat the drum. d senator moran questioned about the holes about appearing in the president's budget. i appreciate the secretary has made the commitment to the modernization, doing the right thing on the ruling and trying to address. it's not an easy job and i don't envy the position he is placed in. let's set aside the fact it sounded like to me we may be staring at a budget shortfall just in this current fiscal year between moving money between re and choice and let's look at fiscal year 2018. that is a good way to snapshot
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the bigger hole that v.a. has to deal with. i.u. and its proposal was presumably was going to fund a lot majority of choice going forward at least $3.2 billion. if we assume that that is not going to happen, that's $3 billion in community care under choice that has to be addressed somehow. if not addressed in the discretionary part of the v.a.'s budget. all well good to say we have enough money, $3 billion is a lot of money, to say we have enough. senator mampin and senator tester mentioned the decision. i think on policy, that is probably the right decision to make for v.a. and d.o.d. but i read an article that the department of defense's obligation is something on the order of $9 billion in the life cycle of that program. it also said that v.a.'s
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obligation will be at least three to four times that great. w does the v.a.'s budget rationalize that point? i'm sure it doesn't. senator rounds mentioned the decision. it's the right thing to do. i think he knows it and acting upon it. i was amused that he said they expedited the rulemaking process and said it went to o.m.b. and that's where the expedited process goes to die. he said it might be nine months and o.m.b. will be on the clock for nine months. that aside, the staub ruling has left v.a. with an obligation of at least $2 billion. where is that money at that is going to pay for that issue? the average in subsequent years is a billion dollars. where is that money at?
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it's not in the v.a. budget either. we are keeping score. we have $3.2 billion i.u. hold for choice. staub.billion hold for and then we have the issue and we don't know what that looks like. i could make the argument looking out in 2015, that budget is certainly short because the community care account in that budget alone is less than the projection for 2018. and the choice plan has it at exactly the same figure. are we going to decrease? we know that's not going to happen. so right now, the v.a. could be staring at a huge hole in its budget for 2018 and we have expressed to city appropriators and because of the timing, the
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appropriators have moved on the house side and mark up their milcon-v.a. bill tomorrow and none of these questions are answered. yet the v.a. has unanswered questions and not enough to simply say we have enough money and which can move it around. that's not true. that's simply not true. i appreciate the opportunity to testify and be happy to answer ny questions you might have. >> mr. chairman, members of the committee, as co-author of the independent budget, we are pleased to present our views for veterans' benefits programs. i will focus on critical needs appeals. also cover our strong opposition to a couple of ill conceived
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administration proposals to scale back veteran disability compensation. they have made significant progress in reducing the claims' backlog and yet work load continues to rise. to manage current and future work load, we recommend 1,750 if f.t.e. which would require an increase of $183 million. v.a.'s rehab service needs additional service. program participation has increased by 15% and based on historical trends, it would increase by another 5%. to meet rising demand to achieve nd sustain the 1-125 client to counselor ratio, there is a recommendation of 266 f.t.e.'s
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which would require a $231 million increase. e recommend it be increased by 270 million. mr. chairman, we have made significant progress on its claims backlog. n consequence is increased backlog of denied back logs. there are appeals at the board and six years on average for a decision by the board. fortunately, we have been part
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of a work group to develop a comprehensive reform. the 24 is built upon stakeholder framework and has received broad bipartisan support. we urge to move forward and pass this legislation. the house has passed similar legislation earlier this year. enactment of this legislation would lead to a more modern flexible appeals system, one that will have quicker decisions on appeals while protecting due process rights. even with passage, the board will need resources commensurate with work load. last year, congress increased by 242 do authorize staffing level of 922 f.t.e.'s. the board has not yet filled those positions.
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expect the board to hire to fill all positions. we do not recommend further staffing increases while this is being approved and implemented. the board and congress must monitor implementation of a new appeals system to ensure staffing remains adequate. we oppose two legislative proposals in the administration's budget. first, we strongly propose to ound down cola's for 10 years. and cumulative effect of this proposed tax would cost beneficiaries 2.7 billion. we are asking to soundly reject it. and will cut off the eligibility or i.u. disabled veterans reach an age
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they might qualify for retirement benefits. mr. chairman, total compensation is not a retirement benefit is provided for as compensation for veterans who suffer life-long service-connected disabilities. furthermore this leads to veterans losing benefits that result from a total disability rating.
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v.f.w. strongly opposes benefits from our most severely disabled veterans to pay for such improvements. if the past week, nearly 40,000 letters and emails from v.f.w. members and supporters have been sent to members of congress opposing to revoke employee veteran benefits who are unable to work. the v.f.w. opposes the proposal
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and other measures to balance the budget on the back of our nation's veterans. we are concerned of the administration's request to make the program a permanent mentor program that could lead to the erosion. continued failure by congress to eliminate sequestration has forced the administration proposed cuts of veteran programs in order to expand the choice program and mandatory spending. questration and dra -- draconian cuts reject. the v.f.w. calls on this committee to join our campaign and finally end the sequestration and do away with federal budget processes. in partnership with our
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independent budget co-authors, i would like to focus on of my remarks on v.a.'s construction and national cemetery administration budget requests. for more than a decade, they have warned congress and v.a. that underfunding has a loud the infrastructure to erode while the capacity has swelled from 221% 2004 to as high as in 2012. we continue to believe this need for space and chronic . derfunding could force it says that improving the conditions of v.a.'s facilities account for the largest resource need top keep pace with the growing demand for v.a. outpatient care. the administration major construction request only funds
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one construction project. we believe that v.a. has requested an adequate amount for fiscal year 2018 major medical leases needs. however, congress must find a way to authorize leasing projects. and 27 major medical facilities leases awaiting congressional authorization, 18 of which have been waiting. delays in authorization of these leases has a direct impact on v.a.'s ability to provide timely care. the administration has a sacred duty to provide our veterans a final resting place that honors their service. in 2016, n.c.a. entered more than 130,000 veterans and family members. the number is expected to increase until 2022.
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other factors placed additional emands >> good to see you back. i missed you when i had you. >> i missed you more than. >> i'm glad to be vertical again. >> i was coming out of the hospital when you were going in. any way, i would like to thank you for the accountability act. an issue we have been dealing with 35 years ago.
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calling on congress to take full accountability and hopefully this will work and we support that bill. i.u. has to be rescinded. that is a classic budgetary proposal. it is a dollar amount from somebody in o.m.b. and the effects are beyond what everyone understood which is the whole nonsense that social security was going to pick it up. not talking about the effects of the family members, the loss of dental chair and champ v.a. and loss of tax abatements in new york city. we gt the expansion for real estate. that would be cut significantly by that. so this has got to be one of the things we are calling upon. since the secretary has alluded they may agree, we would love to
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see a joint effort between the v.a. and the leadership in both the house and senate veterans' affairs committee and saying we aren't going to pass it and tell all those scared people who have been sending emails and letters about the horrors. we have got to bring these people down about 10 notches because they are climbing the walls. that is something that i hope the committees both in the senate and the house and the v.a. would take into consideration so they can acknowledge that this was one bad idea. the choice program is not a choice, it's a false choice and we need to understand how it's done. i screws came back from idaho council and ith my everybody there are utilizes the choice program because they are hundreds of miles away but they
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can tell me the problems with choice and the doctors who will take the v.a.'s money and will sign on. we know they are trying to resolve those problems but going to be a big issue. doctors, where are they coming from? i live in new york city. my dermatologist that i had in my private medical program just retired on me and i managed to outlive him. i'm still sick and i have to go to the doctor. i called up emblem health which is one of the largest in the country and they couldn't find me a dermatologist that i could talk to until august and then they were talking about august. that is a false choice. that is dermatology, which i think i could throw a stick out of my window and hit a dermatologist but they are not
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there because they won't take the v.a.'s payments. like we have seen in medicare and medicaid. so we are concerned about that. it needs to be rethought significantly. because the private sector is t ready to take the v.a. veatrans. r&d budget has been cut. it shouldn't be cut but increased. we need more r&d. we need to get more evidence-based programs and how do we really handle it. i can't tell you all the different programs telling me they have panacea for ptsd. without counseling, it doesn't end their problem and need to get more actions, research into
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these programs. i'm concerned we passed a bill last year that would look at toxic exposure of children. where is that money going to come from if the r&d budget is cut. we got a nice bill passed. where is the money? we need the money. how are we going to get that done. let me say about the appeals process. if we go a lot quicker if they took outside doctors' opinions and didn't have to do redo everything. that would be nice. and the other thing is, if we need to blow up the board of veterans' appeals. it doesn't function. nobody should lose 70% of the time which the v.a. does. i have been in this position for 70% ofs and our v.s.o.'s
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the time get a remapped. 70%. we win, v.a. loses, year after thatafter year and i think is. our vets are around the same percentage. that's ridiculous. he other problem is. his opinion doesn't count for anybody to follow after them. and neither does mine. the denial. and same programs over and over again. the same problems over and over again. we need to get the issue of
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precedence and we now understand the court of veterans' appeals is going to be doing class action lawsuits. i will be happy to answer questions. senator isakson: but also heard the comment that mr. acosta
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about the cola. there are a lot of things out there that over the period of years of the veterans' administration and benefit existence and health care, but times have changed. we probably ought to look at everything we got out there. there may be some pearls of wisdom and some benefits in the cheme of things. we'll do that. open up dialogue. and some of these things that we bring up or o.m.b.
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you have the benefit of looking at the best interests. i appreciate that. but i served the taxpayers and other people. we ought to start having some meetings. e may find up. would love to work with you. and we'll try and set that up. senator: i should have known but i thought we got rid of this and and didn't seem a lot. what you are telling me is back again. >> yes, sir. >> thank you for your leadership when you were chairman of this committee and really eliminating that. now that the president's
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proposal is laid out, proposed to reinstate the cola rounddown as a way to pay for expansion of the choice program as a metropolitanor program. senator: taking murn away from v.a. benefits. how much would this -- if this were implemented, how much would t cost veterans? >> it would cost close to $2.7 billion over 10 years. senator: i don't think we should be nickel and diming veterans. it's sad to see it's coming back. let me ask what is the elephant in the room and that is the concern and the numbers seem to be disputed and not quite the clarity we would like but the
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increase in appropriations for the choice program and the very, very modest increase for traditional v.a. care. s that a concern for you guys? mr. blake? >> one of the concerns is and the secretary addressed it. there were talks about marriages and checkbooks, all of the community care should be streamlined under one account and managed that way. put choice on the mandatory side like discretionary caps that are holding discretionary spending that place that at risk. from the independent budget perspective they are shorting the discretionary pot. and tremendous and when you take into account outside of the health care account, every line item takes a reduction of some
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type. senator: anybody else want to comment? >> i concur with mr. blake. >> i would like to add this whole notion of having ar program and discretionary and not being able to transfer and as carl said having one checkbook. but ultimately you are right, senator. we cannot forget the need to invest in v.a.'s ability to thrive and hire and expand facilities. that is the preferred choice for veterans and we need to continue that. >> i have studied privatization and worked as the city manager nd last two in the councilor's office. i watched them privatize.
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once you go out you are adding layers of bureaucracy and cost. you are not going to a doctor, you are going to a plan sm the plan is going to be administered who is making $2 billion and our v.a. people aren't paid that much but maybe should be as i will tell you in my hospital are.
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senator isakson: the record will stay open for seven days and this committee stands adjourned.
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