99–010

Calendar No. 190

107TH CONGRESS REPORT

1st Session " ! SENATE 107–80

DEPARTMENT OF VETERANS AFFAIRS MEDICAL PROGRAMS

ENHANCEMENT ACT OF 2001

OCTOBER 10, 2001.—Ordered to be printed

Mr. ROCKEFELLER, from the Committee on Veterans’ Affairs,

submitted the following

REPORT

[To accompany S. 1188]

The Committee on Veterans’ Affairs, to which was referred the

bill S. 1188, to amend title 38, United States Code, to enhance the

authority of the Secretary of Veterans Affairs to recruit and retain

qualified nurses for the Veterans Health Administration, and for

other purposes, having considered the same, reports favorably

thereon with an amendment in the nature of a substitute and an

amendment to the title, and recommends that the bill, as amended,

do pass.

INTRODUCTION

On June 14, 2001, the Committee held a hearing to develop a

greater understanding of the factors underlying the imminent

shortage of professional nurses and its projected impact on health

care in the Department of Veterans Affairs. Those testifying at the

hearing included: Senator Max Cleland; Thomas L. Garthwaite,

M.D., Under Secretary for Health, Department of Veterans Affairs

(VA); Catherine J. Rick, R.N., M.S.N., Chief Nurse Consultant,

Nursing Strategic Health Care Group, VA; Sarah Myers, R.N.,

Ph.D., President of the Nurses Organization of Veterans Affairs,

Atlanta, GA; Sandra McMeans, R.N., Representative, American

Nurses Association, Martinsburg, WV; J. David Cox, R.N., First

Vice President, National VA Council, American Federation of Government Employees, Washington, DC; Sandra K. Janzen, R.N.,

M.S., Chief Nurse Executive, Tampa (James A. Haley) VA Medical

Center, Tampa, FL; Robert A. Petzel, M.D., Director, VA Upper

Midwest Health Care Network, Minneapolis, MN; Karen Robinson,

Ph.D., R.N., Chairperson, VISN 13 Nurse Managed Care Initiative,

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Fargo, ND; and Mary Raymer, R.N., M.A., Associate Chief of Staff

for Patient Care Services, Salem VA Medical Center, Salem, VA.

Building upon this hearing and other oversight work, Committee

Chairman John D. Rockefeller IV introduced S. 1188 on July 17,

2001, with the cosponsorship of Ranking Republican Member Arlen

Specter and Senator Max Cleland, to improve nurse recruitment

and retention within VA.

Earlier, on July 10, 2001, Chairman Rockefeller introduced S.

1160, with Senator Larry Craig joining later as a cosponsor. S.

1160 would provide the Secretary of Veterans Affairs authority to

provide service dogs to certain disabled veterans.

On July 23, 2001, Ranking Republican Member Specter introduced S. 1221, which would provide an additional basis for establishing the inability of veterans to defray expenses of necessary

medical care.

On July 19, 2001, the Committee held a hearing, chaired by

Committee Member Paul Wellstone, to receive testimony on S. 739,

S. 1160, S. 1188, and a draft bill prepared by Ranking Republican

Member Specter to change the means test used by the VA in determining whether veterans will be placed in enrollment priority

group 5 or 7. Written testimony was accepted for all pending veterans health-related legislation, including S. 739, S. 1160, S. 1188,

and the draft bill, although oral testimony was limited to S. 739

(reported elsewhere).

COMMITTEE MEETING

On August 2, 2001, the Committee met in open session to consider, among other matters, S. 1188 with an amendment in the nature of a substitute incorporating provisions from S. 1160, S. 1188,

and S. 1221. Present were Senators Rockefeller, Wellstone, Murray,

Miller, Nelson, Specter, Thurmond, and Hutchison. The Committee

voted unanimously to report favorably S. 1188, as amended, to the

Senate.

SUMMARY OF S. 1188 AS REPORTED

S. 1188, as reported (herein referred to as the ‘‘Committee Bill’’)

consists of two titles, summarized below.

TITLE 1—THE DEPARTMENT OF VETERANS AFFAIRS NURSE

RECRUITMENT AND RETENTION ENHANCEMENT ACT OF 2001

Subtitle A—Recruitment Authorities

Section 111 permanently authorizes the Employee Incentive

Scholarship Program; reduces the minimum period of employment

for eligibility in the program from 2 years to 1 year; removes the

award limit for education pursued during a particular school year

by a participant so long as the participant does not exceed the overall limitation for the equivalent of 3 years of full-time education;

and extends authority to increase the award amounts based on

general Federal pay increases.

Section 112 permanently authorizes the Education Debt Reduction Program (EDRP); expands the list of eligible individuals to include those providing direct patient care services or services incident to direct patient care services; extends the number of years

that an employee may participate in the EDRP to 5 years and inVerDate 11-MAY-2000 23:18 Oct 10, 2001 Jkt 099010 PO 00000 Frm 00002 Fmt 6659 Sfmt 6602 E:\HR\OC\SR080.XXX pfrm02 PsN: SR080
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creases the overall award limit to $44,000, with the award payments for the fourth and fifth years of an employee’s participation

in the program limited to $10,000 each; provides limited special authority (until December 31, 2001) for the Secretary to waive the eligibility requirement limiting EDRP participation to recently appointed employees on a case-by-case basis for individuals appointed

on or after January 1, 1999, through September 30, 2000.

Section 113 requires VA to report on the use of authority to request waivers of the pay reduction for re-employed annuitants in

order to meet the requirements for appointments to nurse positions.

Subtitle B—Retention Authorities

Section 121 mandates that VA provide Saturday premium pay to

employees specified in Section 7454(b), the so-called ‘‘title 5/title 38

hybrids.’’ Such hybrids include licensed practical nurses, pharmacists, certified or registered respiratory therapists, physical

therapists, and occupational therapists.

Section 122 gives VA nurses enrolled in the Federal Employee

Retirement System the same ability to use unused sick leave as

part of the retirement year calculation that VA nurses enrolled in

the Civilian Retirement System have.

Section 123 requires VA to carry out an evaluation of nurse-managed clinics, including primary care and geriatric clinics. Matters

to be evaluated include patient satisfaction, provider experiences,

cost of care, access to care, and functional status of patients. This

evaluation will be reported to the House and Senate Committees

on Veterans’ Affairs not later than 18 months after enactment of

this act.

Section 124 requires VA to develop a nationwide policy on staffing standards to ensure that veterans are provided with safe and

high quality care. Such staffing standards should consider the

numbers and skill mix required of staff in specific medical settings

(such as critical care and long-term care).

Section 125 requires VA to submit an annual report on exceptions of experienced nurses from VA’s nurse qualification standards, as set forth by VA directive. The report would include information on the number of waivers requested and granted to promote

nurses who have not received a bachelor’s of science degree in

nursing, as well as information on age, race, and years of experience of the individuals subject to such waiver requests and waivers, as the case may be.

Section 126 requires VA to submit a report on the use of mandatory overtime by licensed nursing staff and nursing assistants in

each facility during 2001, not later than 180 days after passage of

this act. The report would include a description of the amount of

mandatory overtime used by facilities, a description of the mechanisms employed by VA to monitor overtime, an assessment of the

effects of mandatory overtime on patient care, and recommendations regarding ways to prevent the use of mandatory overtime in

other than emergency situations.

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Subtitle C—Other Matters

Section 131 elevates the office of the VA Nurse Consultant so

that individual would report directly to the VA Under Secretary for

Health.

Section 132 exempts registered nurses, physician assistants, and

expanded-function dental auxiliaries from the requirement that

part-time service performed prior to April 7, 1986, be prorated

when calculating retirement annuities.

Section 133 makes modifications to the nurse locality pay authorities, including allowing VA to use third-party survey data.

TITLE 2—OTHER MATTERS

Section 201 authorizes VA to provide certain hearing-impaired

veterans, blind veterans, and veterans with spinal cord injury or

dysfunction, or other chronic physical or mental impairment that

substantially limits mobility, hearing, or activities of daily living,

with service dogs to assist them with everyday activities.

Section 202 modifies the methodology used by the VA in determining whether veterans will be placed in enrollment priority

group 5 or 7 based on income levels. The current placement eligibility threshold is set at approximately $24,000 in the preceding

calendar year, regardless of where in the country the veteran is living.

Section 203 requires that the compliance and oversight activities

carried out by field-based units of the Department of Veterans Affairs Office of Research Compliance and Assurance shall be

charged to the Medical Care appropriation.

BACKGROUND AND DISCUSSION

TITLE 1—THE DEPARTMENT OF VETERANS AFFAIRS NURSE

RECRUITMENT AND RETENTION ENHANCEMENT ACT OF 2001

As the average lifespan lengthens in the United States, the elderly make up a growing proportion of the population. Researchers

project that the proportion of Americans age 65 or older will expand from approximately 13 percent to 20 percent between 2010

and 2030, an increase of about 30 million people. The population

age 85 and older is the fastest growing age group in the United

States; and the likelihood that an individual will require skilled

nursing care increases with age. The demand for skilled nursing

care, especially long-term care services, is projected to increase as

the pool of potential caregivers remains constant or shrinks.

Over the last decade, VA and community health care providers

have embraced managed care principles, which limit inpatient

treatment to the sickest of patients. The demands on professional

nurses have evolved as a growing proportion of hospitalized patients require highly technical, complex nursing care. Simultaneously, the explosive growth in community-based care has increased demand for nursing professionals in outpatient settings.

Registered nurses (RNs) and licensed practical nurses (LPNs)

represent, respectively, the largest and second-largest groups of

health care providers in the United States. VA employs over 35,000

RNs, and about 10,000 LPNs; together, nurses represent about onethird of all VA health care professionals. The Health Resources and

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1 Nurse Staffing and Patient Outcomes in Hospitals (2001). Health Resource and Services Administration. Department of Health and Human Services, Washington, DC.

Services Administration’s 2000 National Sample Survey of Registered Nurses shows that women continue to comprise the vast

majority—more than 95 percent—of professional nurses. As career

opportunities for women have broadened, enrollment in nursing diploma programs has declined precipitously. In 2000, the average

age of working RNs was 45 years nationally and 48 years within

VA. The average age of a newly hired nurse within VA has climbed

to 39 years. Half of VA’s nursing workforce will be eligible for retirement in the next 15 years, with 35 percent of RNs and 29 percent of LPNs eligible to retire by 2005.

Surveys by the American Nurses Association (hereafter ANA),

the Department of Health and Human Services (hereafter HHS),

and academic researchers show that stress, frustration, and low

morale among working nurses have also contributed to the shrinking workforce. Recent years have seen growing job dissatisfaction

among nurses, including 37 significant nursing strikes over issues

such as the safety of the working environment, inflexible or excessive work hours, inadequate wages and benefits, and the lack of a

voice in management.

As the number of experienced nurses willing to work in critical

and long-term care declines, understaffing has already begun to affect medical facilities nationwide. Dr. Thomas L. Garthwaite, VA

Under Secretary for Health, testified at the Committee’s June 14,

2001, hearing that VA can currently ‘‘meet most of the demands for

nursing staff. However, there are increasing difficulties in filling

positions in some locations, and extreme difficulty filling some specialty assignments.’’

This difficulty in filling positions may translate into adverse

working conditions for nurses and diminished services for veterans.

Sandra McMeans, a Martinsburg (WV) VA Medical Center staff

nurse and representative of the ANA, testified at the Committee’s

hearing that:

I believe personally that you will see . . . a decrease in the

patient load in the Martinsburg VA, because I look for the

nurses to leave . . . I see a lot of nurses who are eligible for

retirement who are tired because of the mandatory overtime,

because of having to stay [for] late shifts . . . I see them leaving and going to the private sector.

A recent report by HHS confirmed earlier studies showing that

the quality of care declines and the length of inpatient stays increases when nursing staff levels dwindle.1 Long-term strategies

are needed to avert a national health care crisis already developing

due to the looming nursing shortage. While this issue is getting attention in Congress, pending legislation developed by other congressional committees has not addressed the needs of nurses in

Federal health care systems. In an effort to improve prospects for

nursing careers in general, and to offer VA strategies to recruit and

retain skilled nurses within an increasingly competitive market,

the Committee has developed the legislation described below.

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RECRUITMENT AUTHORITIES

The increased demand for nurses able to provide either complex

technical care or direct outpatient care has not been matched by

a growing supply. Despite Bureau of Labor Statistics estimates

showing that employment opportunities for registered nurses will

grow more rapidly through 2008 than for all other occupations in

the United States, a smaller percentage of graduating high school

students enter nursing degree programs each year. Between 1995

and 1998, enrollment in nursing baccalaureate programs declined

19 percent. Predictably, the number of new nurses has steadily declined over the last 5 years, resulting in a shrinking labor pool

available to VA and community health care providers. As medical

facilities compete for an ever-diminishing number of qualified professionals, understaffing has become a constant factor in the health

care environment.

Testimony offered by each of the registered nurses at the Committee’s June 14, 2001, hearing confirmed that inadequate staffing

creates stressful working conditions for nurses and endangers patient safety. Understaffing endangers not only the quality of direct

patient care, but impedes VA’s ability to conduct clinical research

and to provide nursing and medical students with critical supervision and training. However, mandating that VA increase staffing

levels is simply not an option without a pool of qualified nurses

willing to enter and remain in the field.

VA faces the same challenges as private sector hospitals in recruiting and retaining nurses, exacerbated by budget constraints

and a nursing workforce more rapidly approaching retirement. The

passage of the Department of Veterans Affairs Health Care Personnel Incentive Act of 1998 as Public Law 105–368 offered VA

means to recruit and retain qualified health care professionals in

fields where high demand produces competition from the private

sector. The Employee Incentive Scholarship Program (hereafter

EISP) authorized VA to award up to $10,000 per year of scholarship money toward full-time study, for up to 3 years, to eligible VA

health care professionals in return for a period of obligated service.

Currently, enrollment in the scholarship program is limited to employees with 2 or more years of VA employment and is scheduled

to terminate on December 31, 2001.

This legislation also authorized the Education Debt Reduction

Program (hereafter EDRP), allowing VA to repay education-related

loans incurred by recently hired professionals in high-demand

areas. This program, still in the final implementation process and

also scheduled to terminate on December 31, 2001, authorized VA

to pay $6,000, $8,000, and $10,000 per year, respectively, over 3

years toward principal and interest on educational loans for professionals in high-demand fields.

As of June 14, 2001, VA had awarded 189 scholarships amounting to over $1.7 million, primarily for nursing and pharmacist degrees, through the EISP and VA’s National Nursing Education Initiative. As evidenced by many letters from VA employees submitted

for the record of the Committee’s hearing, the EISP provides an excellent incentive for recruiting nurses and other health care professionals to VA. Section 111 of the Committee bill would permanently authorize the EISP, reduce the minimum period of employVerDate 11-MAY-2000 23:18 Oct 10, 2001 Jkt 099010 PO 00000 Frm 00006 Fmt 6659 Sfmt 6602 E:\HR\OC\SR080.XXX pfrm02 PsN: SR080
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ment for eligibility from 2 years to 1 year, and remove the award

limit for a participant’s educational expenses during a single school

year as long as these do not exceed the overall limitation for the

equivalent of 3 years of full-time education. Section 112 of the

Committee bill would permanently authorize the EDRP; would expand the list of eligible individuals to include those providing either direct or incidental patient care services; would extend the

window of participation to 5 years and the overall award limit to

$44,000, with the payments for the fourth and fifth years limited

to $10,000 each; and would provide limited authority (until December 31, 2001) for the Secretary to extend EDRP participation to recently appointed employees on a case-by-case basis. These changes,

supported by both the American Federation of Government Employees (hereafter AFGE), and the Nurses Organization of Veterans

Affairs, will allow VA to compete more aggressively with similar

educational recruitment packages that private sector employers can

offer to nurses and other highly sought health care professionals.

Attracting a new generation of nursing students into the profession is essential to ensuring that VA and other health care providers can replace retiring nurses in the next two decades. Many

working nurses were introduced to nursing careers through now

defunct youth service organizations, such as the American Red

Cross ‘‘candystriper’’ program. New programs, such as the recently

developed VA Nurse Cadet program at the Salem (Virginia) VA

Medical Center, must now fill the need to introduce students to

nursing and to professional nurse role models. Mary Raymer, R.N.,

and founder of the VA Nurse Cadet program, testified at the Committee hearing that:

With no formal mentoring programs and frequent media attention to the problems and hazards of the nurses’ work environment, there are few positive messages to choose nursing.

Interventions to correct workplace issues must be made in concert with developing and expanding mentoring programs, such

as the VA Cadet, that provide the youth opportunities for positive experiences in the healthcare setting.

However, until such programs can be expanded successfully, immediate measures must be taken to increase the pool of working

skilled nurses. Within VA, allowing annuitants to work without endangering their retirement pay would provide an immediate reserve of qualified nurses. The testimony of VA Under Secretary for

Health Garthwaite at the Committee’s hearing stated that VA has

existing authority to request that the Office of Personnel Management waive dual compensation restrictions under special conditions. The frequency with which these waivers have been applied

to rehiring retired nurses is unclear. Section 111 of the Committee

bill would require VA to report on the use of these waivers to assist

in filling appointments to VA nursing positions.

RETENTION AUTHORITIES

A large survey recently conducted by the University of Pennsylvania’s Center for Health Outcomes and Policy Research showed

that more than 40 percent of American nurses surveyed reported

being dissatisfied with their jobs, and that more than 20 percent

planned to leave those jobs in the next year. Job dissatisfaction reVerDate 11-MAY-2000 23:18 Oct 10, 2001 Jkt 099010 PO 00000 Frm 00007 Fmt 6659 Sfmt 6602 E:\HR\OC\SR080.XXX pfrm02 PsN: SR080
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lated to issues of ‘‘burnout,’’ with the majority of nurses surveyed

reporting that too few nurses care for too many patients, that

nurses are not included in management and scheduling decisions,

and that inadequate support staffing further strains already overextended professional nurses by forcing RNs to take on non-nursing

tasks.

Although VA enjoys a lower rate of nurse turnover systemwide

than the national average (8.5% as compared to 15% in 1999), the

testimony of all three VA field nurses at the Committee’s hearing

indicated that nurses’ morale has begun to decline as staffing

shortages worsen in VA. Although competitive salaries and scholarship bonuses offer VA means to recruit qualified nurses, new initiatives will be needed to retain these nurses. The Committee bill includes provisions intended to help VA become a national model for

safe working conditions and the employer of choice for professional

nurses.

Sufficient pay, with wages equivalent to other local health care

providers, is an obvious cornerstone of nurse recruitment and retention. Premium pay in particular refers to a differential rate of

pay offered for undesirable tours of duty, such as weekends or holidays. Currently, title 38 guarantees premium pay (at 25 percent

over the basic rate) for VA RNs who work regular Saturday and

Sunday shifts. However, LPNs and other support personnel who

straddle both title 5 and title 38 authorities are eligible only for

Sunday premium pay, leaving Saturday premium pay at the discretion of the medical facility directors. Under this law, LPNs and

other ‘‘title 5/title 38 hybrids’’ working side-by-side with RNs may

not receive the same benefits for serving during unpopular tours.

Section 121 of the Committee bill establishes Saturday premium

pay standards for LPNs and other professionals (pharmacists, certified or registered respiratory therapists, physical therapists, and

occupational therapists) classified as ‘‘title 5/title 38 hybrids.’’ Creating equitable premium pay rates for these professionals should

improve VA’s ability to recruit and retain these personnel, whose

efforts are essential both to direct patient care and to supporting

RNs.

Currently, VA RNs enrolled in the Civilian Retirement System

can receive credit for days of unused sick leave in calculating total

days of service for annuity benefits. However, the same benefit is

not available to nurses who enrolled in the Federal Employee Retirement System. Section 122 of the Committee bill would establish

parity for nurses enrolled in these retirement programs in computing total service.

Although salary levels certainly play a critical role in drawing

nurses to specific providers, working conditions have a far greater

impact on nurse recruitment and retention. In response to the

nursing surveys cited above, RNs consistently identified opportunities for career development as a key component of professional satisfaction. Several studies have also shown that both patient outcomes and nurse recruitment improve in health care settings in

which nurses have direct control over the patient care environment.

Nurse-managed clinics offer advanced practice nurses increased

authority as independent primary care providers. Four nurse-managed community-based outpatient clinics established in VA’s Upper

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Midwest Health Care Network have operated since 1999, providing

primary care to an average of 1,000 veterans. Dr. Robert Petzel, director of this network, testified at the Committee’s hearing that

‘‘nurse practitioners are effective as providers of safe, high-quality,

cost-effective primary care, which results in high patient satisfaction,’’ but acknowledged that ‘‘we must now demonstrate in terms

of outcomes-based research the services that nurse practitioners

provide and their positive impact on client outcomes.’’

Preliminary findings suggest that these nurse-managed clinics

not only improve veterans’ access to care, but may promote improved health outcomes through better patient education. Nursemanaged clinics might prove especially valuable as an avenue to

provide preventive and chronic care to the aging veterans population. To test this theory, section 123 of the Committee bill requires VA to evaluate how nurse-managed clinics affect patient

health care outcomes as well as nurse retention.

Staffing levels also contribute to the nursing work environment

and nurse retention, with nurses increasingly expressing frustration over growing patient-to-nurse ratios. In a recent ANA survey,

75 percent of more than 7,000 nurses surveyed felt that the quality

of nursing care in their work settings had declined in the past two

years, with inadequate staffing cited as a chief cause. Research

supports these perceptions. This February, HHS released the aforementioned study on patient outcomes and nurse staffing, based on

data from more than 5 million inpatient discharges in 11 states.

The HHS study confirmed earlier research demonstrating a strong

relationship between higher nurse staffing levels and lower rates

of serious adverse events such as urinary tract infections, pneumonia, shock, and upper gastrointestinal bleeding. High nurse

staffing also correlated with shorter lengths of inpatient stay, reducing costs to the hospitals as well as the burdens for patients

and their families.

Given the clearly established connections between adequate

nurse staffing levels and improved patient outcomes, a nationally

recognized safe staffing standard would provide an essential tool

for maintaining high quality health care and improving working

conditions for nurses. No such national standard currently exists,

and older systems for determining staffing levels no longer suit the

rapidly evolving health care environment in the United States. According to the June 14 testimony submitted by David Cox, RN, representing AFGE:

Currently, DVA only maintains staffing standards for Intensive Care Units and the operating room. These standards have

forced DVA to maintain minimal staffing ratios on these

wards. In other wards, like psychiatric and medical, staffing

standards are determined by the number of staff on duty, not

the needs of the patients. In other words, staffing standards at

the DVA are not consistent from facility to facility. Nor are the

staffing levels adequately measured or rational. Moreover,

there is no accountability for unsafe staffing levels.

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2 Ibid.

3 Appropriateness of Minimum Nurse Staffing Ratios in Nursing Homes (2001). Report to Congress, Health Care Financing Administration, Department of Health and Human Services,

Washington, DC. 4 Nursing Staff in Hospitals and Nursing Homes: Is it Adequate? (1996). Wunderlich, G.S.,

Sloan, F.A. and Davis, C.K., Editors. Institute of Medicine, National Academy of Sciences. Washington, DC: National Academy Press. 5 Improving the Quality of Long-Term Care (2001). Gooloo, S., Wunderlich, G.S., and Kohler,

P.O., Editors. Committee on Improving Quality in Long-Term Care, Division of Health Care

Services, Institute of Medicine, National Academy of Sciences. Washington, DC: National Academy Press. 6 Nursing Workforce: Recruitment and Retention of Nurses and Nurse Aides is a Growing

Concern (2001). Testimony before the Senate Committee on Health, Education, Labor, and Pensions. General Accounting Office, Washington, DC.

Recent studies by HHS,2, 3 the Institute of Medicine,4, 5 and the

General Accounting Office 6 have all recognized the link between

nurse staffing standards and patient safety. In addition, they also

found that adequate staffing plays a significant role in creating a

favorable work environment for nurses. Rather than prescribing

specific staffing ratios, section 124 of the Committee bill would require VA to develop a national policy on nurse staffing standards

that considers intensity of care and other issues of patient acuity,

addresses patient safety and health outcomes, and improves the

working environment for professional nurses.

In an effort to encourage nursing education, VA recently implemented a directive on revised Nursing Qualification Standards that

requires VA’s registered nurses to hold a bachelor’s in nursing

(BSN) degree to advance beyond entry level by 2005, effective immediately for new hires. While these standards promote professional development and a more skilled nursing staff, they limit promotions and salary increases for nurses without bachelor’s degrees,

regardless of experience. The Nurses Organization of Veterans Affairs estimates that 35 percent of new hires will not advance beyond entry level under the new standards if they do not take advantage of scholarship initiatives. This may shrink the pool of

nurses willing to work for VA at a time when VA facilities are already struggling to meet staffing needs.

Nurse Professional Standards Boards in each network have the

authority to waive degree requirements for experienced nurses who

completed nursing diplomas or associate’s degrees, but nurses have

reported encountering varying degrees of resistance in obtaining

these waivers, leading to the loss of experienced nurses to the private sector. In order to temper higher educational standards with

the need to retain experienced nurses, section 125 of the Committee bill would require VA to report annually on the use of education requirement waivers systemwide to identify the numbers of

waivers requested and granted, and how these relate to the age,

race, and experience of the applicants.

To meet demands for skilled nurses, many health care organizations rely heavily upon mandatory overtime to fill staffing gaps.

Unplanned and significant increases in working hours, often in

consecutive shifts, lead to dangerous fatigue and a high turnover

rate. A lack of nursing executives leaves nurses with little administrative support for reporting unsafe conditions. RNs who refuse

overtime can be charged with patient abandonment, endangering

their licenses.

Testimony given at the June 14, 2001, hearing suggested that

some VA medical centers rely on mandatory overtime regularly,

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and that its use makes VA a less attractive employer in areas

where community hospitals offer solely voluntary overtime. The

AFGE estimates that VA has nearly doubled its costs for overtime

in the past few years, from $31.5 million in FY 1997 to $57.6 million in FY 2000, supporting estimates that VA has increased its dependence on overtime as a tool to meet staffing needs. According

to testimony submitted by the AFGE:

The DVA does not have a nationwide policy on mandatory

overtime, nor does DVA take disciplinary actions against Medical Directors or nurse managers who rely upon mandatory

overtime excessively in lieu of adequate staffing. Only the patient and the RN suffer the consequences when a bleary-eyed

RN makes a medical error at the end of two consecutive tours

of duty. AFGE regards DVA’s failure to hold management accountable for excessive overtime as a disturbing indication of

DVA’s lack of commitment to patient safety and in becoming

the employer of choice.

Catherine J. Rick, VA’s Chief Nurse Consultant, testified that

VA has experienced a ‘‘slight increase in the use of overtime over

the past three years,’’ but acknowledged that VA Headquarters has

no systemwide policy on mandatory overtime and initiated surveys

to determine the extent of mandatory overtime use in the field only

in immediate anticipation of the Committee’s hearing. As the Committee is deeply concerned about growing dependence on a potentially unsafe working practice, section 126 of the Committee bill

would require VA to report not later than 180 days after the passage of this act on the use of mandatory overtime in the VA health

care system in 2001, to assess its effects on patient care, and to

identify strategies for eliminating its use.

TITLE 1—OTHER MATTERS

RNs comprise the largest group of health care workers within

VA, providing the greatest proportion of direct health care services

to veterans. To improve communication to and from this essential

workforce, VA has recently transformed the Nursing Service office

into the Nursing Strategic Healthcare Group (NSHG), which serves

as a resource for the development of policies and research strategies to support the nursing workforce. However, despite the realignment of VHA Headquarters to create executive level offices

that reflect key functions within VA’s health care system, the office

of the nurse consultant remains outside of the chief officer structure.

Section 131 of the Committee bill would elevate the office of the

VA Nurse Consultant to report directly to the VA Under Secretary

for Health, which would be analogous to similar positions within

HHS and the Office of the Surgeon General. Creating this position

would provide the VA Under Secretary for Health with a clearly

recognized source of information on the roles and needs of nurses,

and demonstrate an unmistakable commitment to including nurses

within health care decision-making processes.

Section 132 of the Committee bill addresses an issue of fairness

in retirement annuity benefits promised to part-time VA nurses

prior to 1986. Organizations that provide inpatient care face the

perennial challenge of recruiting highly skilled health care proVerDate 11-MAY-2000 23:18 Oct 10, 2001 Jkt 099010 PO 00000 Frm 00011 Fmt 6659 Sfmt 6602 E:\HR\OC\SR080.XXX pfrm02 PsN: SR080
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viders amenable to working night shifts, weekends, and holidays.

In the past, VA offered retirement incentives for part-time nurses

as a mechanism of preventing nursing shortages and encouraging

part-time nurses to work unpopular tours of duty on nights and

weekends. Specifically, VA recruited title 38 medical staff by offering to credit these employees with 40 hours of work per week for

retirement purposes, regardless of the actual number of hours

worked. In return, these staff committed to VA as an exclusive employer, enabling VA to secure coverage for undesirable shifts at the

discretion of medical facility directors.

Prior to 1980, the civil service annuity formula used to determine

pension levels relied upon the highest salary received in the average year of the highest-paid 3 years (high-3 pay) of Federal employment, with no distinction between the pensions of full-time and

part-time workers except for salary level. Public Law 96–330, requested by VA and passed in 1980, amended section 4109 of title

38 to use the full-time equivalent of the high-3 pay for part-time

VA medical personnel, prorated to the portion of time actually

worked. VA sought this legislation to eliminate disproportionately

large annuities accruing to staff (particularly physicians) who had

worked a mixture of full- and part-time hours during their careers.

Subsequent ‘‘technical amendments’’ passed sequentially in Public

Law 96–385 (section 508) and Public Law 97–72 (section 402) first

repealed and then restored the retrospective changes.

When Congress passed Public Law 99–272, the Consolidated Omnibus Budget Reconciliation Act of 1985 (COBRA), all part-time

employees in the federal workforce including those covered by titles

5 and 38 became subject to the same retirement formula, with annuities based on full-time equivalent high-3 pay prorated to the

portion of time worked. This law ‘‘grandfathered’’ any part-time

service completed before its enactment on April 6, 1986, and repealed section 4109(b) of title 38, which treated VA medical personnel covered under title 38 differently than other Federal employees. This restored full-time work credit to VA nurses who had

been recruited under the part-time work agreement prior to the enactment date.

In response, VA requested legislation to exclude all title 38 employees from the provision giving full-time retirement credit for

part-time work in Public Law 99–272. VA’s request was based on

the assumption that many part-time VA physicians enjoyed lucrative outside salaries, including private medical practices. Congress

granted the VA’s request, incorporating the change into Public Law

99–509 (section 7003), the 1986 Omnibus Budget Reconciliation.

This provision removed all title 38 employees from Public Law 99–

272 and restored all prospective and retrospective part-time retirement annuity provisions in Public Law 96–330 (section 114). Thus,

current law treats retirement credit for VA nurses for part-time

work performed prior to April 6, 1986, differently from any other

part-time Federal employees.

Section 132 of the Committee bill would amend section 7426 of

title 38 to exempt registered nurses, physician assistants, and expanded-function dental auxiliaries from the requirement that parttime service performed prior to April 7, 1986, be prorated when calculating retirement annuities. This action would restore the commitment made to VA nurses and support personnel who forfeited

13

the opportunity to seek other full-time or supplemental part-time

work in return for retirement annuity benefit. This provision would

not restore full-time work credits toward the annuities for physicians or dentists, addressing VA’s historical concerns about the

costs of such benefits.

Section 133 of the Committee bill would make modifications to

the nurse locality pay authorities, including allowing VA to use

third-party survey data to establish consistency in wages for nurses

at all rates of compensation, rather than only on beginning rates.

Section 7251 of title 38 allows the directors of VA health care facilities to request adjustments to the minimum rates of basic pay for

nurses based on local variations in the labor market. This ability

to modify nurse salaries to achieve consistency with the local market conditions allows VA to recruit nurses competitively in regions

with high demand. Currently, VA health care facilities must rely

on industry-wage surveys provided by the Bureau of Labor Statistics (BLS), or upon third-party industry wage surveys if no BLS

data is available, to calculate beginning rates of compensation for

corresponding health care professionals.

TITLE 2—OTHER MATTERS

SEC. 201. SERVICE DOGS FOR CERTAIN DISABLED VETERANS

Section 201 of the Committee bill, which would authorize the

Secretary to provide dog-guides to blind veterans and authorize the

provision of service dogs to hearing-impaired veterans and veterans

with spinal cord injuries, is drawn directly from S. 1160, introduced by Committee Chairman Rockefeller. Service dogs have traditionally been viewed only as assisting the visually impaired.

However, primarily as a result of the Americans with Disabilities

Act of 1990, there have been efforts in recent years to find alternative methods of providing assistance to people with various kinds

of disabilities. While there have been many technological developments in this field, a need still remains for long-term assistance

that allows for the greatest possible independence on the part of

the disabled individual. The Paralyzed Veterans Association of

America strongly endorses this goal, stating that:

For over half a century, PVA has fought for the integration

of people with disabilities into the economic and social life of

our Nation. Providing service dogs to veterans who need them

would be a major step forward in the ultimate realization of

this goal.

There are numerous ways in which service dogs can assist their

owners. Tasks such as opening and closing doors, turning switches

on and off, carrying bags, and dragging a person to safety in the

case of an emergency are just a few of the standard duties for service dogs. Their ability to perform these types of duties makes them

invaluable to those who require day-to-day aid. Dr. Ronald D.

Fletcher, a veteran from Fayetteville, Pennsylvania, wrote to the

Committee Chairman, stating that he had to pay out of his own

pocket to acquire a service dog. He expressed that: ‘‘Because of my

dog-hearing guide, I live a happier and more independent life.’’

Having this sort of assistance can make a big difference in terms

of offering not only physical support, but companionship as well.

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Various types of evidence illustrate the value of companion pets,

not just to the disabled, but to everyone. The Journal of the American Medical Association published a trial study a few years ago

that examined the impact of service dogs on the lives of people with

disabilities—both in terms of economic and social impacts. The

study concluded that:

Substantial positive changes on most dependent measures

were associated with the presence of a service dog both between and within groups. Psychologically, all participants

showed substantial improvements in self-esteem, internal locus

of control, and psychological well-being within 6 months after

receiving their service dogs. Socially, all participants showed

similar improvements in community integration. Demographically, participants demonstrated substantial increases in terms

of school attendance and part-time employment. Economically,

all participants showed dramatic decreases in the number of

paid assistance hours.

Overall, the JAMA study concluded that service dogs can greatly

improve the quality of life for the disabled. Given the various ways

in which these dogs can assist their owners and the relatively low

cost of implementing this program, the Committee has included

section 201 in the Committee bill.

SEC. 202. MODIFICATION OF MEANS TEST

Section 202, which is drawn from S. 1221, as introduced by Senator Specter, modifies the means test used by VA in determining

whether veterans will be placed in enrollment priority group 5 or

7. In accordance with section 1722(a) of title 38, United States

Code, veterans with incomes below specified levels currently set at

approximately $24,000 for veterans with no dependents are placed

in enrollment priority group 5 and as such, are eligible to receive

medical care at VA facilities at no charge. Under current law, only

one means test threshold is set for all non-service-connected veterans seeking access to VA health care, with no variation based

upon locality. Section 202 would establish new geographically

based income thresholds for VA.

The purpose of the change proposed in section 202 is to eliminate

the inequity imposed on those veterans living in higher cost-of-living areas. The cost of living in large urban areas is generally much

greater than in many rural parts of the country. This provision restructures the means tests threshold to make it locality based, by

taking the costs of living in each region into account when determining a veteran’s eligibility for certain VA health care treatment.

As the Paralyzed Veterans of America (PVA), which supports this

change, testified, the VA already has experience using locality

based pricing for its reasonable charges for the recovery of thirdparty health care costs and for VERA calculations.

The Department of Housing and Urban Development (HUD) has

an index for determining income levels that is based upon the cost

of living for an identified locality, as well as the number of dependents within the family. PVA provided testimony that veterans in

high cost-of-living areas would benefit from the higher income

standard found in the HUD formula, with many being qualified for

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enrollment priority 5 because of their increased inability to defray

copayments.

This provision changes section 1722 of title 38, United States

Code, to also include the HUD income index in determining eligibility for treatment as a low-income family based upon the veteran’s permanent residence. This eligibility determinant is in addition to ability to receive state assistance under title XIX of the Social Security Act, the receipt of pension under section 1521 of title

38, United States Code, or meeting VA’s annual means test thresholds. An important goal in creating this additional eligibility determinant is to protect those veterans already enrolled in priority 5

from being reevaluated and placed into priority 7, thereby triggering various copayment requirements. Thus, the current national

threshold would remain in place as the base figure even if the

HUD formula determines the low-income rate for a particular area

is actually less than that amount.

The effective date of this change is January 1, 2002, and shall

apply to all means tests after December 31, 2001, using data from

the HUD index at the time the means test is given.

SEC. 203. FUNDING OF COMPLIANCE AND OVERSIGHT ACTIVITIES

Section 203 of the Committee bill addresses funding of the VA

office which is responsible for the protection of human research

subjects and research integrity within VA medical centers, the Office of Research Compliance and Assurance (hereafter ORCA). The

rapid pace of biomedical research in recent years has led to substantial medical advancements, and concomitantly, to a dramatic

increase in research trials involving human and animal subjects.

VA established ORCA by directive in 1999, in the wake of an NIHmandated shutdown of all human studies at the VA Greater Los

Angeles Healthcare System because of lax procedures for approving

and overseeing trials involving human research subjects.

The staff of ORCA advises the VA Under Secretary for Health on

all matters affecting the integrity of research, the safety of human

research subjects and research personnel, and the welfare of laboratory animals, and investigates any allegations of research improprieties or scientific misconduct. ORCA staff at VA Headquarters work with other appropriate Federal and VA offices to

provide guidance and develop policies and procedures related to research safety and integrity. Staff from the four ORCA regional offices conduct both routine periodic and unannounced inspections of

research programs at VA medical centers within their designated

geographical areas to ensure compliance with policies concerning

research integrity and scientific misconduct. The ORCA regional

staff investigate allegations of non-compliance with research and

safety policies and procedures, develop appropriate educational materials and administer remedial training if necessary, and assist research staff in restoring compliance.

The ORCA Chief Officer reports to the office of the Under Secretary for Health, and funding for the headquarters ORCA office

comes from the Medical Administration and Miscellaneous Operating Expenses (MAMOE) account. However, VA currently funds

ORCA’s regional offices from the Medical and Prosthetic Research

Program account, the account which is intended to cover the direct

costs of research projects.

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HHS recently recognized an inherent conflict of interest in allowing the National Institutes of Health (hereafter NIH) to manage

and fund the oversight of safety and integrity in human studies research. In June 2000, HHS eliminated the NIH Office of Protection

from Research Risks and transferred all authority for human subject protection to the Office of Human Research Protections, which

reports directly to the HHS Under Secretary for Health and receives funding from non-research accounts.

Funding of the ORCA regional offices from VA’s Research account creates a similar conflict of interest, and does not ensure

human research subjects of oversight protection by an appropriately independent, objective, and unbiased entity. Other oversight mechanisms within VA, such as Institutional Review Boards,

are not funded from the Research account. VA’s General Counsel

has determined that congressional authority is required to allow

VA to fund ORCA’s regional offices from accounts other than the

research appropriation. Therefore, section 203 of the Committee

bill would authorize VA to fund ORCA’s regional offices out of the

Medical Care appropriation, as these offices directly protect patient

and human subject welfare.

COST ESTIMATE

In compliance with paragraph 11(a) of rule XXVI of the Standing

Rules of the Senate, the Committee, based on information supplied

by the Congressional Budget Office (CBO), estimates that, compared to the CBO baseline, there would be costs resulting from enactment of the Committee bill.

The cost estimate provided by CBO follows:

U.S. CONGRESS,

CONGRESSIONAL BUDGET OFFICE,

Washington, DC, September 10, 2001.

Hon. JOHN D. ROCKEFELLER IV,

Chairman, Committee on Veterans’ Affairs,

U.S. Senate, Washington, DC.

DEAR MR. CHAIRMAN: The Congressional Budget Office has prepared the enclosed cost estimate for S. 1188, the Department of

Veterans Affairs Medical Programs Enhancement Act of 2001.

If you wish further details on this estimate, we will be pleased

to provide them. The CBO staff contact is Sam Papenfuss.

Sincerely,

DAN L. CRIPPEN, Director.

Enclosure.

S. 1188, Department of Veterans Affairs Medical Programs Enhancement Act of 2001 (As ordered reported by the Senate Committee on Veterans’ Affairs on August 2, 2001)

S. 1188 would change how the Department of Veterans Affairs

(VA) compensates nurses and other employees and would provide

expanded medical benefits to some veterans. The bill would increase retirement benefits for VA nurses by changing how retirement annuities are calculated and would make permanent the authority to provide scholarships and pay school debts as an incentive

to attract and keep employees in critical occupations. Under the

17

bill, certain VA employees also would be eligible for premium pay

for working on Saturdays. Finally, S. 1188 would calculate the income thresholds for determining whether a veteran qualifies for

free health care on a regional basis rather than using a single national level.

CBO estimates that enacting the bill would increase direct spending by $1 million in 2002, $9 million over the 2002–2006 pe- riod, and $26 million over the 2002–2011 period. Because the bill

would affect direct spending, pay-as-you-go procedures would

apply. In addition, S. 1188 would authorize funding or modify provisions governing discretionary spending for veterans’ programs,

which CBO estimates would result in additional outlays of about

$390 million in 2002 and about $3 billion over the 2002–2006 period, assuming appropriation of the estimated amounts.

S. 1188 contains no intergovernmental or private-sector mandates as defined in the Unfunded Mandates Reform Act (UMRA)

and would not affect the budgets of state, local, or tribal governments.

ESTIMATED COST TO THE FEDERAL GOVERNMENT

The estimated budgetary impact of S. 1188 is shown in Table 1.

This estimate assumes the legislation will be enacted near the

start of fiscal year 2002 and that the necessary funds for implementing the bill will be provided for each year. The costs of this

legislation fall within budget functions 600 (income security) and

700 (veterans benefits and services).

Table 1.—Estimated Budgetary Impact of S. 1188

[By Fiscal Year, in Millions of Dollars]

2002 2003 2004 2005 2006

Changes in Direct Spending

Estimated Budget Authority .................................................................................... 1 1 2 2 2

Estimated Outlays ................................................................................................... 1 1 2 2 2

Changes in Spending Subject to Appropriation

Estimated Authorization Level ................................................................................ 428 559 691 714 726

Estimated Outlays ................................................................................................... 388 539 671 704 716

Direct Spending

Section 132 would change the way part-time service performed

by registered nurses, physicians assistants, and certain dental

technicians at VA prior to April 7, 1986, is treated in calculating

retirement annuities. Under current law, retirement benefits for

these workers are calculated according to a formula that prorates

all part-time service performed in these positions. For most other

federal workers, part-time service performed prior to April 7, 1986,

is treated as full-time service when calculating retirement annuities. Information about these employees is limited, but based on

information supplied by VA, CBO estimates there are about 1,600

of these workers still employed by the federal government. Assuming that retirement benefits calculated under the new formula

would be between 4 percent and 13 percent higher than under the

current formula, depending on how much part-time service was

performed before April 7, 1986, CBO estimates that enacting this

section would increase direct spending by $1 million in 2002, $8

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million over the 2002–2006 period, and $23 million over the 2002– 2011 period.

Section 122 would authorize unused sick leave to be counted toward total years of service when calculating retirement benefits accrued by registered nurses who are employed by the Veterans

Health Administration and retire under the Federal Employees’ Retirement System (FERS). Under current law, unused sick leave

is counted toward total service under the Civil Service Retirement

System, but not under FERS. According to information from VA,

about 1,000 registered nurses retire from VA every year, and most

employees have between 3 and 6 months of accrued sick leave upon

retirement. CBO estimates that enacting this provision would increase direct spending by less than $500,000 every year until 2011

when the increase would round to $1 million, with the 10-year

costs totaling $3 million.

Spending Subject to Appropriation

Table 2 shows the estimated effects of S. 1188 on discretionary

spending for veterans’ programs, assuming that appropriations are

provided in the amounts of the estimated authorizations.

Table 2.—Estimated Changes in Spending Subject to Appropriations for S. 1188

[By Fiscal Year, in Millions of Dollars]

2001 2002 2003 2004 2005 2006

Spending Under Current Law for Veterans’ Medical Care

Estimated Authorization Level a ................................................... 20,863 21,866 22,110 22,839 23,547 24,285

Estimated Outlays ........................................................................ 20,418 21,501 22,020 22,613 23,298 24,028

Proposed Changes

Compensation:

Estimated Authorization Level ............................................. 0 8 9 11 14 16

Estimated Outlays ............................................................... 0 8 9 11 14 16

Income Threshold:

Estimated Authorization Level ............................................. 0 420 550 680 700 710

Estimated Outlays ............................................................... 0 380 530 660 690 700

Total Changes:

Estimated Authorization Level ............................................. 0 428 559 691 714 726

Estimated Outlays ............................................................... 0 388 539 671 704 716

Spending Under S. 1188

Estimated Authorization Level ...................................................... 20,863 22,294 22,669 23,530 24,261 25,011

Estimated Outlays ........................................................................ 20,418 21,889 22,559 23,284 24,002 24,744

a The 2001 level is the estimated net amount appropriated for that year. The current-law amounts for the 2002–2006 period assume that

appropriations remain at the 2001 level, with adjustments for inflation.

Compensation. S. 1188 contains several provisions that would increase compensation and benefits for health care workers employed

by VA. CBO estimates that these provisions would increase discretionary spending by $8 million in 2002 and by $58 million over the

2002–2006 period, assuming appropriation of the necessary

amounts.

Employee Incentive Scholarships. VA currently administers a program to provide scholarships for employees in the Veterans Health

Administration as an incentive to help meet staffing needs in critical occupations. The authority to provide those incentive scholarships expires on December 31, 2001. Section 111 would permanently extend this authority as well as clarify the rules for awarding full-time and part-time scholarships. VA expects to spend about

$7 million on this program in fiscal year 2001. CBO estimates that

allowing VA to continue to provide those scholarships would cost

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$7 million in 2002 and $58 million over the 2002–2006 period, assuming appropriation of the estimated amounts. Because VA is currently funding this program, the costs associated with this provision are assumed in the baseline levels shown for veterans’ medical

care.

Education Debt Reduction. VA currently has the authority to reimburse new employees for employee payments of principal and interest on debts incurred for education related to the position the

employee presently holds. The authority to enroll employees into

this program expires on December 31, 2001. To date, VA has not

implemented this program nor has it finalized the regulations

under which the program would operate. Section 112 would extend

this authority permanently, increase the maximum amount that

could be reimbursed from $24,000 over three years to $44,000 over

five years, and temporarily expand the definition of a new employee through December 31, 2001. CBO estimates that about 200

employees would take advantage of this program on an annual

basis, with about two-thirds receiving the full amount allowed

under the bill. CBO estimates that extending this authority along

with the other changes would cost $4 million in 2002 and $36 million over the 2002–2006 period, assuming both appropriation of the

estimated amounts and that VA actually implements this program

by January 1, 2002. Since this program has not yet begun operation, the current law baseline does not reflect the costs of extending the program and these costs are included in the ‘‘Compensation’’ section of Table 2.

Saturday Pay. Currently, pharmacists, licensed practical nurses,

and many therapists receive premium pay when they work on Sundays, but premium pay for work performed on Saturdays is managed at a local level and many do not receive such pay for Saturday

work. Section 121 would require that all these employees receive

premium pay, equal to 25 percent of their hourly wage, for all

hours worked on Saturday. Using data from VA, CBO estimates

that this provision would cost $4 million in 2002 and $22 million

over the 2002–2006 period, assuming appropriation of the estimated amounts.

Income Threshold. Under current law, VA furnishes free medical

care to veterans who meet certain eligibility requirements—one of

which is an income threshold. Any veteran eligible for Medicaid, or

who receives a VA pension, or who has an income below a statutory

level (currently $23,688 for a veteran without a dependent) can receive free health care. Under the bill, veterans eligible for low-income housing also would qualify for free medical care. In general,

the Department of Housing and Urban Development sets eligibility

for low-income housing at 80 percent of each county’s median income with adjustments for cost-of-living.

This provision would affect both veterans who currently receive

medical care from VA and those who do not currently use VA

health care services. CBO estimates that the total cost associated

with expanding eligibility for free VA medical care would be $380

million in 2002 and about $3 billion over the 2002–2006 period, assuming appropriation of the estimated amounts.

Current VA Health Care Users. Using data from VA and the Current Population Survey, CBO estimates that under this provision

about 1.4 million veterans would become eligible for free health

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care. CBO estimates that this number includes more than 250,000

veterans who currently use VA medical facilities but are not presently eligible for free health care. Under the bill, these veterans

would no longer need to make copayments when receiving health

care benefits. Because individuals use more health care services

when they do not face any out-of-pocket costs, the cost of providing

medical care would increase for those users who become eligible for

free health care. Using data from VA and from published research,

CBO estimates that those veterans receiving free health care would

cost VA about $700 more per person in 2002. Using that information and adjusting for inflation, CBO estimates that providing free

health care to veterans currently using VA would cost about $170

million in 2002 and almost $1 billion over the 2002–2006 period,

assuming appropriation of the estimated amounts.

Because the veterans discussed above would be eligible for free

health care, VA also would lose the copayments that these veterans

make when receiving care. CBO estimates that the lost copayments

would total about $40 million over the 2002–2006 period. Under

current law, those copayments can be spent by VA, if authorized

by the appropriators. Since CBO’s baseline assumes both the collection and the spending of those copayments, the budgetary effect

would be neutral. Although there is no net budgetary impact, VA

would not be able to provide the same level of care as they currently do without additional appropriations to replace the lost copayments.

New VA Health Care Users. CBO also estimates that some veterans who do not currently use VA medical facilities because of the

requirement to make copayments would do so once they became eligible for free health care. Currently, only about 20 percent of veterans eligible for free health care based on income actually use VA

medical facilities. CBO expects that an even lower percentage of

those who would become eligible for free health care would end up

using VA medical facilities, because some of those veterans have

access to health care from other sources. CBO estimates that eventually about 100,000 newly eligible veterans would begin using VA

medical care at a cost of more than $4,000 per person. CBO estimates that providing free health care to these veterans would cost

$210 million in 2002 and about $2 billion over the 2002–2006 period, assuming appropriation of the estimated amounts.

PAY-AS-YOU-GO CONSIDERATIONS

The Balanced Budget and Emergency Deficit Control Act sets up

pay-as-you-go procedures for legislation affecting direct spending or

receipts. The net changes in outlays that are subject to pay-as-yougo procedures are shown in Table 3. For the purposes of enforcing

pay-as-you-go procedures, only the effects in the current year, the

budget year, and the succeeding four years are counted.

Table 3.—Estimated Impact of S. 1188 on Direct Spending and Receipts

[By Fiscal Year, in Millions of Dollars]

2001 2002 2003 2004 2005 2006 2007 2008 2009

Changes in outlays ........................................................ 0 1 1 2 2 2 3 3 3

Changes in receipts *

* Not applicable.

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INTERGOVERNMENTAL AND PRIVATE-SECTOR IMPACT

S. 1188 contains no intergovernmental or private-sector mandates as defined in UMRA and would not affect the budgets of

state, local, or tribal governments.

Estimate prepared by: Federal Costs: Sam Papenfuss and Geoffrey Gerhardt. Impact on State, Local, and Tribal Governments:

Elyse Goldman. Impact on the Private Sector: Allison Percy.

Estimate approved by: Peter H. Fontaine, Deputy Assistant Director for Budget Analysis, Congressional Budget Office.

REGULATORY IMPACT STATEMENT

In compliance with paragraph 11(b) of rule XXVI of the Standing

Rules of the Senate, the Committee on Veterans’ Affairs has made

an evaluation of the regulatory impact that would be incurred in

carrying out the Committee bill. The Committee finds that the

Committee bill would not entail any regulation of individuals or

businesses or result in any impact on the personal privacy of any

individuals and that the paperwork resulting from enactment

would be minimal.

TABULATION OF VOTES CAST IN COMMITTEE

In compliance with paragraph 7 of rule XXVI of the Standing

Rules of the Senate, the following is a tabulation of votes cast in

person or by proxy by members of the Committee on Veterans’ Affairs at its August 2, 2001, meeting. On that date, the Committee,

by unanimous voice vote, ordered S. 1188, as amended, reported favorably to the Senate.

AGENCY REPORT

On August 31, 2001, the Honorable Anthony J. Principi, Secretary of the Department of Veterans Affairs, transmitted the Department’s views on S. 1811, a bill to enhance the authority of the

Secretary of Veterans Affairs to recruit and retain qualified nurses

for the Veterans Health Administration, and for other purposes.

Excerpts from Secretary Principi’s correspondence are reprinted

below:

* * * * * * *

I am pleased to provide the Department’s views on S. 1188, a bill

‘‘to enhance the authority of the Secretary of Veterans Affairs to recruit and retain qualified nurses for the Veterans Health Administration, and for other purposes.’’ VA’s nurses are critical front-line

components of the VA health-care team. Our health-care providers

are our most important resource in delivering high-quality, compassionate care to our Nation’s veterans. VA must maintain the ability

to recruit and retain well-qualified nurses in order to continue that

care. Compensation, employment benefits and workplace factors affect that ability, particularly in highly competitive labor markets

and for hard-to-fill specialty assignments. While VA is able to offer

generally competitive pay in most markets, the Department must

continuously monitor the recruitment and retention of health-care

providers, particularly nurses, and trends in private sector employment and workforce projections. Although VA nurse staffing is generally stable overall, VA is experiencing increasing difficulties in

22

filling positions in some locations, and filling some specialty assignments is extremely difficult.

S. 1188 contains several proposals that VA believes would assist

us in meeting the challenge of recruiting and retaining the nurses

required to meet VA’s patient care needs. However, it also contains

provisions that VA does not support, as explained below.

Sections 101 and 102 of S. 1188 would make permanent the Department’s Employee Incentive Scholarship Program (EISP) and

Education Debt Reduction Program (EDRP) and make other technical changes. Specifically, the bill would make the authority for

each of these programs permanent. It would also require the Secretary to make periodic adjustments to the amount of assistance

paid under these programs when adjustments are made to the Federal General Schedule. Such adjustments are now required in the

other Educational Assistance Programs authorized in chapter 76.

The bill would also expand eligibility so that more employees could

participate in these programs. In addition, it would provide that

EISP payments are to be made on a school year basis instead of

a calendar year basis. It would extend to five years (from the current three) the length of time that an employee may participate in

the EDRP and increase the overall award limit to $44,000.

VA supports the intent of sections 101 and 102 of the bill. The

EISP and EDRP are valuable recruitment and retention tools for

the Department. Indeed, we consider these programs to be vital in

assuring VA’s continued ability to place health-care professionals in

hard-to-fill occupations, in ensuring that VA’s registered nurses

have the educational foundation to perform their enhanced role in

health-care management, and in enabling VA to compete with the

private sector for highly qualified health-care professionals.

Section 103 of S. 1188 would require a report on VA’s use of the

authority in sections 8344 and 8468 of title 5 to request waivers

of the pay reduction for reemployed annuitants for appointments to

VHA nurse positions. VA supports this provision.

Section 201 would mandate Saturday premium pay for hybrid

employees. VA does not support this provision because it appears

to be unnecessary. Under the provisions of 38 U.S.C. 7454(b) and

(c), the Secretary may authorize premium pay under Title 38, including Saturday premium pay, for hybrid employees at any location. This authority has been delegated to facility directors. VHA

believes that the flexibility to authorize premium pay according to

local practices and to maintain VA’s competitive stance is the most

equitable and cost-effective method of adjusting premium pay. The

cost estimate for this provision is under development.

Section 202 would amend section 8415 of title 5, United States

Code, by adding a new subsection (I) to allow the use of unused

sick leave in the annuity computations of registered nurses with

the Veterans Health Administration (VHA). This would provide an

incentive for VA nurses to accumulate and save their sick leave because the unused sick leave would count as additional service credit upon retirement and would increase the employees’ annuities.

VA opposes this provision. It is inappropriate to extend this incentive to such a narrow class of Federal employees. Further, this provision would likely have PAYGO costs for the civil service retirement and disability fund, although no estimate has been developed

yet.

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Section 203 of S. 1188 would require an evaluation of VA nursemanaged care clinics, including primary care and geriatric clinics

located in three different Veterans Integrated Service Networks

(VISNs). If VHA does not have three such clinics, VHA would be

required to establish three. The evaluation is to address: patient

satisfaction; provider experiences; access to care, including waiting

time; functional status of clinic patients; other matters determined

by the Secretary. VA would be required to provide a report on the

evaluation. VA supports this provision. VA intends to use current

nurse-managed care clinics or convert existing clinics to nursemanaged care clinics as evaluation sites.

Section 204 of the bill would require that we establish a nationwide policy for assuring adequate staffing to maintain VHA capacity mandated by section 8110, taking into account staffing levels

and skill mix required for the range of patient care and services

provided in VA facilities. It also would require that we have staffing necessary to maintain mandated VHA capacity, consistent with

our overtime policies, and consistent with the new nationwide staffing policy.

VA opposes section 204. There are currently no universally accepted staffing guidelines or staffing ratios in the public or private

sector. While a mandated standard would seemingly make determination of quality a matter of a simple equation, staffing is too

multi-factorial to be so easily structured. All facilities must comply

with Joint Commission on Accreditation of Healthcare Organizations (JCAHO) staffing standards. JCAHO does not look for rigid

staffing standards or staff-to-patient ratios since these measures

have proven to be ineffective predictors of quality. JCAHO is currently piloting a staffing standard that takes into account clinical/

service indicators (quality outcomes) in combination with human

resource indicators (both direct and indirect caregivers). The approach calls for multiple indicators to be considered in combination.

This has been the recommended VHA approach for staffing methodology over the past several years. Professional judgment is the

essence and final guarantor of quality care; VA’s system is designed to foster such professionalism. Some of the complex factors

that influence staffing decisions are:

• Patient acuity and mix on a given unit

• Availability of varying personnel types, i.e., physician specialties, RNs, LPNs, and nursing assistants

• Experience, education and quality of staff

• Availability of other professional partners (i.e. social workers,

pharmacists)

• Availability of support services, supplies and equipment

• Physical layout of the patient care and treatment areas

• Technological and administrative support availability

• Academic affiliation, etc.

Staffing decisions are dependent upon these factors applied on a

24-hour and seven-day per week basis. VA believes that staffing decisions must be made near the site of care. There is no known national methodology that is workable. Additional costs can be anticipated to result from an inflexible national staffing standard.

Section 205 of the bill would require an annual report, beginning

in 2002, concerning VA’s use of authorities to enhance retention of

experienced nurses. Included are educational assistance programs,

24

waivers of educational requirements (by age, race, and years of experience) in the VA nurse qualification standard and other available retention authorities. VA supports this provision.

Section 206 would require a report on the use of mandatory overtime by licensed nursing staff and nursing assistants in each facility. The report would include a description of mechanisms to monitor mandatory overtime, an assessment of the effects of mandatory

overtime, including its contribution to medical errors, recommendations concerning mechanisms for preventing mandatory overtime

other than for emergency situations, and other matters VA considers appropriate. VA supports this provision.

Section 301 of S. 1188 would elevate the position of the Chief

Consultant for Nursing Programs (Director, Nursing Service) so

that it would report directly to the Under Secretary for Health.

Currently, this position reports to the Under Secretary through the

Chief Patient Care Services Officer (Associate Deputy Under Secretary for Health). The effect of this provision is to recognize the

importance of this position as the chief advisor to the Under Secretary for Health on nursing issues, as well as its role as the operational head for VA nursing programs. VA supports this provision.

Section 302 would change the treatment, for purposes of retirement credit, of part-time service performed by certain title 38 employees prior to April 7,1986. Currently, part-time service performed by title 5 employees prior to April 7,1986, is treated as fulltime service; title 38 employees’ part-time service prior to April 7,

1986, is credited as part-time service on a pro rata basis, thus resulting in lower annuities. Part-time service after April 6,1986, is

prorated for both title 5 and title 38 employees. VA believes there

should be parity in the treatment of part-time service for title 38

and title 5 employees for retirement purposes. There are some potential unintended effects associated with this provision. Therefore,

the Administration is seeking to resolve, in a comprehensive manner, technical problems associated with computations of part-time

service. This provision would likely have PAYGO costs for the civil

service retirement and disability fund, although no estimate has

been developed yet.

Section 303 of S. 1188 would make clarifying amendments to

VA’s nurse locality pay statute, 38 U.S.C. § 7451, consistent with

recent changes made by Public Law 106–419. Those changes were

intended to improve the survey process used to adjust nurse locality pay rates. This provision would amend subparagraphs (A) and

(B) of section 7451(d)(3) by deleting the phrase ‘‘beginning rates of’’

throughout. This is consistent with the requirement under the recent amendments that third-party surveys conducted under this

authority must now include broader compensation data. It also

would delete the phrase ‘‘or at any other time that an adjustment

in rates of pay is scheduled to take place’’ in section 7451(d)(4).

This provision provided VA medical center directors with discretion

to not pass on General Schedule adjustments to nurse salaries. The

recent amendments provide for an automatic adjustment to nurse

salaries at the same time and in the same amount as the General

Schedule increase; facility directors no longer have discretion to

limit such increases.

Further, section 303 of S. 1188 would eliminate the requirement

that facility directors notify the Under Secretary for Health within

25

10 days of a decision not to adjust salary rates based on survey

data as unnecessary. Public Law 106–419 reinstated an annual reporting requirement, which includes information concerning facility

directors’ decisions not to adjust salary rates based on survey data.

Finally, this proposal would delete references to ‘‘grades’’ of positions in the report required under section 7451(e)(4) so as to

achieve consistency with the way VA collects information for the

report. These amendments would improve administration of the

complicated nurse locality pay system, consistent with the intent of

the amendments in Public Law 106–419.

Section 304 of S. 1188 would make technical amendments to section 38 U.S.C. § 7631.

Because S. 1188 would affect direct spending, it is subject to the

pay-as-you-go (PAYGO) requirement of the Omnibus Budget Reconciliation Act of 1990. VA’s cost estimate of S. 1188 is under development and will be provided to you when complete.

The Office of Management and Budget has advised that there is

no objection to the submission of this report from the standpoint

of the Administration’s program.

* * * * * * *

On July 19, 2001, the Honorable Thomas L. Garthwaite, MD,

Under Secretary for Health, Department of Veterans Affairs, appeared before the Committee and submitted testimony on, among

other things, S. 1188, S. 1160, and a draft bill to change the means

test used by the VA in determining whether veterans will be placed

in enrollment priority group 5 or 7. Excerpts from this statement

are reprinted below:

STATEMENT OF THOMAS L. GARTHWAITE, MD, UNDER SECRETARY FOR HEALTH, DEPARTMENT OF VETERANS AFFAIRS

Mr. Chairman and Members of the Committee, I am pleased to

be here to present the Department’s views on six different bills

being considered by the Committee. They cover a wide range of

subjects related to personnel matters and VA’s provision of health

care services to veterans. We support many provisions in the bills

before the Committee, however there are some on which we recommend modifications, and others which we cannot support at this

time. thank you for the opportunity to testify today on several legislative items of great interest to veterans.

* * * * * * *

S. 1188

Mr. Chairman I will next present our views on S. 1188, a bill designed to improve the recruitment and retention of VA nurses. Our

nurses are critical front-line components of the VA health care

team. Our health care providers are our most important resource

in delivering high-quality, compassionate care to our Nation’s veterans. We must maintain the ability to recruit and retain wellqualified nurses in order to continue that care. Compensation, employment benefits and workplace factors affect that ability, particularly in highly competitive labor markets and for hard-to-fill specialty assignments. Thanks to the efforts of this Committee and the

House Veterans’ Affairs Committee, we have been able to offer genVerDate 11-MAY-2000 23:18 Oct 10, 2001 Jkt 099010 PO 00000 Frm 00025 Fmt 6659 Sfmt 6602 E:\HR\OC\SR080.XXX pfrm02 PsN: SR080
26

erally competitive pay in most markets. We continuously monitor

the recruitment and retention of health care providers, particularly

nurses, and trends in private sector employment and workforce

projections. As we noted in testimony before this committee last

month, VA nurse staffing is generally stable overall, but there are

increasing difficulties in filling positions in some locations, and filling some specialty assignments is extremely difficult. However, I

am not prepared to give the Administration’s views on this bill

without further study. We will provide our views on this measure

as soon as possible.

* * * * * * *

S. 1160

Mr. Chairman I now turn to S. 1160, a bill that would authorize

us to furnish a service dog to any veteran with a compensable service-connected disability who is hearing impaired or who has a spinal cord injury or dysfunction. Service dogs can assist a disabled

person in his or her daily life and can assist that person during

medical emergencies. They can be trained in many tasks, including,

but not limited to, pulling a wheelchair, carrying a back-pack,

opening and closing doors, helping with dressing and undressing,

picking up things one drops, picking up the phone, and hitting a

distress button on the phone. Such dogs can also notice when the

disabled individual is in distress and can find help. Dogs can also

assist the hearing impaired by alerting them to doorbells, ringing

phones, smoke detectors, crying babies, and emergency sirens on

vehicles. We support this bill, and any new costs will be handled

under existing resources within the FY 2002 President’s Budget.

Having said that, however if it were to become law, we would promulgate prescription criteria and guidelines for provision of such

dogs to insure that we provide animals only to those veterans who

can most benefit from them.

* * * * * * *

DRAFT LEGISLATION ON THE MEANS TEST THRESHOLD

Mr. Chairman, also on the agenda is a draft bill that would establish new geographically based income thresholds for VA to use

in determining a nonservice-connected veteran’s priority for receiving VA care and whether the veteran must agree to pay copayments in order to receive that care. As you know, Mr. Chairman,

the law now requires that most veterans enroll in our health care

system in order to receive care. Enrollees are placed in an enrollment priority group that is based, in many instances, on their level

of income and net worth. Although we currently provide care to

veterans in all enrollment priority groups, if there were funding

shortages in the future, it might be necessary to determine that

those with relatively higher incomes must be disenrolled, meaning

they could no longer receive VA care. Current law establishes, on

a National basis, the specific income thresholds that we must use

to determine the priority group of any given enrollee with no service-connected disability or other special status. We place higher income veterans in priority group 7 and lower income veterans in priority group 5. This draft bill would establish new geographically

based income thresholds that VA could use for placing veterans in

27

those priority groups. The draft bill would use a specific statutorily

based poverty index used by the Department of Housing and Urban

Development that is established for Metropolitan Statistical Areas

(MSA’s), Primary Metropolitan Statistical Areas (PMSA’s) and

counties. The index defines a family as low income if family income

does not exceed 80% of the median family income for the area in

which the family resides. If we determined that a veteran’s income

was below the threshold for the specific area where the veteran

lived, and his net worth was below our threshold, we would place

that veteran in enrollment priority category 5. In many instances,

particularly in urban areas, this new income threshold is greater

then the current statutory income threshold that we use for determining whether a veteran should be placed in priority group 5. The

draft bill would provide that if the new geographically based income threshold is lower then the current threshold, VA would use

the old threshold as that would benefit the veteran.

We in VA are very interested in examining the use of geographically based income thresholds for placing nonservice-connected veterans in different enrollment priority groups. We recognize that the

cost of living in large urban areas is much greater then in many

more rural parts of the country. What might be considered a reasonably high income in some locations may be totally inadequate

in other higher cost locations. However, at this time we cannot support the methodology proposed in the draft bill. There are many

poverty indexes that are established in various ways. However,

there are serious issues about what these indexes really measure.

We believe further study is needed to determine the most appropriate method for tackling this problem. I will next present our

views on S. 1188, a bill designed to improve the recruitment and

retention of VA nurses. Our nurses are critical front-line components of the VA health care team. Our health care providers are

our most important resource in delivering high-quality, compassionate care to our Nation’s veterans. We must maintain the ability

to recruit and retain well-qualified nurses in order to continue that

care. Compensation, employment benefits and workplace factors affect that ability, particularly in highly competitive labor markets

and for hard-to-fill specialty assignments. Thanks to the efforts of

this Committee and the House Veterans’ Affairs Committee, we

have been able to offer generally competitive pay in most markets.

We continuously monitor the recruitment and retention of health

care providers, particularly nurses, and trends in private sector

employment and workforce projections. As we noted in testimony

before this committee last month, VA nurse staffing is generally

stable overall, but there are increasing difficulties in filling positions in some locations, and filling some specialty assignments is

extremely difficult. However, I am not prepared to give the Administration’s views on this bill without further study. We will provide

our views on this measure as soon as possible.

CHANGES IN EXISTING LAW MADE BY THE COMMITTEE BILL, AS

REPORTED

In compliance with rule XXVI paragraph 12 of the Standing

Rules of the Senate, the following provides a print of the statute

or the part or section thereof to be amended or replaced (existing

law proposed to be omitted is enclosed in black brackets, new matVerDate 11-MAY-2000 23:18 Oct 10, 2001 Jkt 099010 PO 00000 Frm 00027 Fmt 6659 Sfmt 6602 E:\HR\OC\SR080.XXX pfrm02 PsN: SR080
28

ter is printed in italic, existing law in which no change is proposed

is shown in roman):

TITLE 38, UNITED STATES CODE

* * * * * * *

CHAPTER 17—HOSPITAL, NURSING HOME,

DOMICILIARY, AND MEDICAL CARE

SUBCHAPTER I—GENERAL

Sec.

1701. * * *

* * * * * * *

SUBCHAPTER II—HOSPITAL, NURSING HOME OR DOMICILIARY CARE

AND MEDICAL TREATMENT

* * * * * * *

ø1714. Fitting and training in use of prosthetic appliances; seeing-eye dogs.¿

1714. Fitting and training in use of prosthetic appliances; dog-guides and service

dogs.

* * * * * * *

ø§ 1714. Fitting and training in use of prosthetic appliances;

seeing-eye dogs¿

§ 1714. Fitting and training in use of prosthetic appliances;

dog-guides and service dogs

* * * * * * *

ø(b) The Secretary may provide seeing-eye or guide dogs trained

for the aid of the blind to veterans who are entitled to disability

compensation, and may pay travel and incidental expenses (under

the terms and conditions set forth in section 111 of this title) to

and from their homes and incurred in becoming adjusted to such

seeing-eye or guide dogs. The Secretary may also provide such veterans with mechanical or electronic equipment for aiding them in

overcoming the handicap of blindness.¿

(b)(1) The Secretary may provide any blind veteran who is entitled to disability compensation with—

(A) a dog-guide trained for the aid of the blind; and

(B) mechanical or electronic equipment for aid in overcoming

the disability of blindness.

(2) The Secretary may provide a service dog to the following:

(A) Any hearing-impaired veteran who is entitled to disability

compensation.

(B) Any veteran with a spinal cord injury or dysfunction who

is entitled to disability compensation.

(C) Any veteran entitled to disability compensation who has

any other chronic physical or mental impairment that substantially limits mobility, hearing, or activities of daily living in

order to assist such veteran in overcoming such physical or

mental impairment.

29

(3) In providing a dog-guide or service dog to a veteran under this

subsection, the Secretary may pay travel and incidental expenses

(under the terms and conditions set forth in section 111 of this title)

of the veteran to and from the veteran’s home and incurred in becoming adjusted to the dog-guide or service dog, as the case may be.

* * * * * * *

§ 1722. Determination of inability to defray necessary expenses; income thresholds

(a) For the purposes of section 1710(a)(2)(G) of this title, a veteran shall be considered to be unable to defray the expenses of necessary care if— (1) the veteran is eligible to receive medical assistance under

a State plan approved under title XIX of the Social Security

Act (42 U.S.C. 1396 et seq.);

(2) the veteran is in receipt of pension under section 1521 of

this title; øor¿

(3) the veteran’s attributable income is not greater than the

amount set forth in subsection (b)ø.¿; or

(4) the veteran (including any applicable part of the veteran’s

family) is eligible for treatment as a low-income family under

section 3 of the United States Housing Act of 1937 (42 U.S.C.

1437a) for the area in which the veteran resides.

* * * * * * *

CHAPTER 73—VETERANS HEALTH ADMINISTRATION— ORGANIZATION AND FUNCTIONS

SUBCHAPTER I—ORGANIZATION

Sec.

7301. * * *

* * * * * * *

7324. Annual report on use of authorities to enhance retention of experienced nurses.

§ 7306. Office of the Under Secretary for Health

(a) The Office of the Under Secretary for Health shall consist of

the following:

* * * * * * *

(5) A Director of Nursing Service, who shall be a qualified

registered nurse and who shall be responsible to, and report directly to, the Under Secretary for Health for the operation of

the Nursing Service.

* * * * * * *

§ 7324. Annual report on use of authorities to enhance retention of experienced nurses

(a) ANNUAL REPORT.—Not later than January 31 each year, the

Secretary, acting through the Under Secretary for Health, shall submit to Congress a report on the use during the preceding year of authorities for purposes of retaining experienced nurses in the Veterans Health Administration, as follows:

(1) The authorities under chapter 76 of this title.

30

(2) The authority under VA Directive 5102.1, relating to the

Department of Veterans Affairs nurse qualification standard,

dated November 10, 1999, or any successor directive.

(3) Any other authorities available to the Secretary for those

purposes.

(b) REPORT ELEMENTS.—Each report under subsection (a) shall

specify for the period covered by such report, for each Department

medical facility and for each Veterans Integrated Service Network,

the following:

(1) The number of waivers requested under the authority referred to in subsection (a)(2), and the number of waivers granted under that authority, to promote to the Nurse II grade or

Nurse III grade under the Nurse Schedule under section

7404(b)(1) of this title any nurse who has not completed a bachelors of science in nursing in a recognized school of nursing, set

forth by age, race, and years of experience of the individuals

subject to such waiver requests and waivers, as the case may

be.

(2) The programs carried out to facilitate the use of nursing

education programs by experienced nurses, including programs

for flexible scheduling, scholarships, salary replacement pay,

and on-site classes.

* * * * * * *

§ 7426. Retirement rights

* * * * * * *

(c) The provisions of subsection (b) shall not apply to the parttime service before April 7, 1986, of a registered nurse, physician assistant, or expanded-function dental auxiliary. In computing the annuity under the applicable provision of law specified in that subsection of an individual covered by the preceding sentence, the service described in that sentence shall be credited as full-time service.

* * * * * * *

§ 7451. Nurses and other health-care personnel: competitive

pay

* * * * * * *

(d)(1) * * *

* * * * * * *

(3)(A) In the case of a Department health-care facility located in

an area for which there is current information, based upon an industry-wage survey by the Bureau of Labor Statistics for that labor

market, on øbeginning rates of¿ compensation for corresponding

health-care professionals for the BLS labor-market area of that facility, the director of the facility concerned shall use that information as the basis for making adjustments in rates of pay under this

subsection. Whenever the Bureau of Labor Statistics releases the

results of a new industry-wage survey for that labor market that

includes information on øbeginning rates of¿ compensation for corresponding health-care professional, the director of that facility

shall determine, not later than 30 days after the results of the survey are released whether an adjustment in rates of pay for employees at that facility for any covered position is necessary in order

31

to meet the purposes of this section. If the director determines that

such an adjustment is necessary, the adjustment, based upon the

information determined in the survey, shall take effect on the first

day of the first pay period beginning after that determination.

(B) In the case of a Department health-care facility located in an

area for which the Bureau of Labor Statistic does not have current

information on øbeginning rates of¿ compensation for corresponding health-care professional for the labor-market area of

that facility for any covered position, the director of that facility

shall conduct a survey in accordance with this subparagraph and

shall adjust the amount of the minimum rate of basic pay for

grades in that covered position at that facility based upon that survey. To the extent practicable, the director shall use third-party industry wage surveys to meet the requirements of the preceding

sentence. Any such survey shall be conducted in accordance with

regulations prescribed by the Secretary. Those regulations shall be

developed in consultation with the Secretary of Labor in order to

ensure that the director of a facility collects information that is

valid and reliable and is consistent with standards of the Bureau.

The survey should be conducted using methodology comparable to

that used by the Bureau in making industry-wage surveys except

to the extent determined infeasible by the Secretary. To the extent

practicable, all surveys conducted pursuant to this subparagraph or

subparagraph (A) shall include the collection of salary midpoints,

actual salaries, lowest and highest salaries, average salaries, bonuses, incentive pays, differential pays, actual beginning rates of

pay, and such other information needed to meet the purpose of this

section. Upon conducting a survey under this subparagraph the director concerned shall determine, not later than 30 days after the

date on which the collection of information through the survey is

completed or published, whether an adjustment in rates of pay for

employees at that facility for any covered position is necessary in

order to meet the purposes of this section. If the director determines that such an adjustment is necessary, the adjustment, based

upon the information determined in the survey, shall take effect on

the first day of the first pay period beginning after that determination.

(C)(i) A director of a Department health-care facility may use

data on the øbeginning rates of¿ compensation paid to certified registered nurse anesthetists who are employed on a salary basis by

entities that provide anesthesia services through certified registered nurse anesthetists in the labor-market area only if the

director—

(I) has conducted a survey of øbeginning rates of¿ compensation for certified registered nurse anesthetists in the local

labor-market area of the facility under subparagraph (B);

* * * * * * *

(4) If the director of a Department health-care facility, or the

Under Secretary for Health with respect to Regional and Central

Office employees, determines, after any survey under paragraph

(3)(B) øor at any other time that an adjustment in rates of pay is

scheduled to take place under this subsection¿, that it is not necessary to adjust the rates of basic pay for employees in a grade of

a covered position at that facility in order to carry out the purpose

of this section, such an adjustment for employees at that facility in

32

that grade shall not be made. øWhenever a director makes such a

determination, the director shall within 10 days notify the Under

Secretary for Health of the decision and the reasons for the decision.¿

* * * * * * *

(e)(1) * * *

* * * * * * *

(4) Each director of a Department health-care facility shall provide to the Secretary, not later than July 31 each year, a report on

staffing for covered positions at that facility. The report shall include the following:

(A) Information on turnover rates and vacancy rates for each

øgrade in a¿ covered position, including a comparison of those

rates with the rates for the preceding three years.

(B) The director’s findings concerning the review and evaluation of the facility’s staffing situation, including whether there

is, or is likely to be, in accordance with criteria established by

the Secretary, a significant pay-related staffing problem at that

facility for any øgrade of a¿ covered position and, if so, whether a wage survey was conducted, or will be conducted with respect to that grade.

* * * * * * *

(D) In any case in which the director, after finding that there

is, or is likely to be, in accordance with criteria established by

the Secretary, a significant pay-related staffing problem at that

facility for any øgrade of a¿ covered position, determines not

to conduct a wage survey with respect to that position, a statement of the reasons why the director did not conduct such a

survey.

* * * * * * *

§ 7454. Physician assistants and other health care professionals: additional pay

* * * * * * *

(b)(1) When the Secretary determines it to be necessary in order

to obtain or retain the services of certified or registered respiratory

therapists, licensed physical therapists, licensed practical or vocational nurses, pharmacists, or occupational therapists, the Secretary may, on a nationwide, local, or other geographic basis, pay

persons employed in such positions additional pay on the same

basis as provided for nurses in section 7453 of this title.

(2) Health care professionals employed in positions referred to in

paragraph (1) shall be entitled to additional pay on the same basis

as provided for nurses in section 7453(c) of this title.

* * * * * * *

§ 7631. Periodic adjustments in amount of assistance

(a)(1) Whenever there is a general Federal pay increase, the Secretary shall increase the maximum monthly stipend amount, the

maximum tuition reimbursement amount, øand the maximum Selected Reserve member stipend amount¿ the maximum Selected Reserve member stipend amount, the maximum employee incentive

33

scholarship amount. Any such increase shall take effect with respect to any school year that ends in the fiscal year in which the

pay increase takes effect, and the maximum education debt reduction payments amount. (2) The amount of any increase under paragraph (1) of this subsection is the previous maximum amount under that paragraph

multiplied by the overall percentage of the adjustment in the rates

of pay under the General Schedule made under the general Federal

pay increase. Such amount shall be rounded to the next lower multiple of $1.

(b) For purposes of this section:

* * * * * * *

(4) The term ‘‘maximum employee incentive scholarship

amount’’ means the maximum amount of the scholarship payable to a participant in the Department of Veterans Affairs Employee Incentive Scholarship Program under subchapter VI of

this chapter, as specified in section 7673(b)(1) of this title and

as previously adjusted (if at all) in accordance with this section.

(5) The term ‘‘maximum education debt reduction payments

amount’’ means the maximum amount of education debt reduction payments payable to a participant in the Department of

Veterans Affairs Education Debt Reduction Program under subchapter VII of this chapter, as specified in section 7683(d)(1) of

this title and as previously adjusted (if at all) in accordance

with this section.

ø(4)¿ (6) The term ‘‘general Federal pay increase’’ means an

adjustment (if an increase) in the rates of pay under the General Schedule under subchapter III of chapter 53 of title 5.

* * * * * * *

§ 7631. Periodic adjustments in amount of assistance

* * * * * * *

(b) For purposes of this section:

(1) The term ‘‘maximum monthly stipend amount’’ means the

maximum monthly stipend that may be paid to a participant

in the Scholarship Program specified in section 7613(b) of this

title and as previously adjusted (if at all) in accordance with

this øsubsection¿ section. (2) The term ‘‘maximum tuition reimbursement amount’’ means the maximum amount of tuition reimbursement provided to a participant in the Tuition Reimbursement Program

specified in section 7622(e) of this title and as previously adjusted (if at all) in accordance with this øsubsection¿ section. (3) The term ‘‘maximum Selected Reserve member stipend

amount’’ means the maximum amount of assistance provided

to a person receiving assistance under subchapter V of this

chapter, as specified in section 7653 of this title and as previously adjusted (if at all) in accordance with this øsubsection¿

section.

* * * * * * *

§ 7672. Eligibility; agreement

* * * * * * *

34

(b) ELIGIBLE DEPARTMENT EMPLOYEES.—For purposes of subsection (a), an eligible Department employee is any employee of the

Department who, as of the date on which the employee submits an

application for participation in the Program, has been continuously

employed by the Department for not less than ø2 years¿ one year.

* * * * * * *

§ 7673. Scholarship

* * * * * * *

(b) AMOUNTS.—The total amount of the scholarship payable

under subsection (a)— (1) in the case of a participant in the Program who is a full- time student, may not exceed $10,000 øfor any 1 year¿; and

ø(2) in the case of a participant in the Program who is a

part-time student, shall be the amount specified in paragraph

(1) reduced in accordance with the proportion that the number

of credit hours carried by the participant in that school year

bears to the number of credit hours required to be carried by

a full-time student in the course of education or training being

pursued by the participant.

ø(c) LIMITATION ON YEARS OF PAYMENT.—(1) Subject to paragraph (2), a participant in the Program may not receive a scholarship under subsection (a) for more than three school years.

ø(2) The Secretary may extend the number of school years for

which a scholarship may be awarded to a participant in the Program who is a part-time student to a maximum of six school years

if the Secretary determines that the extension would be in the best

interest of the United States.¿

(2) in the case of a participant in the Program who is a parttime student, shall bear the same ratio to the amount that

would be paid under paragraph (1) if the participant were a

full-time student in the course of education or training being

pursued by the participant as the coursework carried by the student bears to full-time coursework in that course of education

or training.

(c) LIMITATIONS ON PERIOD OF PAYMENT.—(1) The maximum

number of school years for which a scholarship may be paid under

subsection (a) to a participant in the Program shall be six school

years.

(2) A participant in the Program may not receive a scholarship

under subsection (a) for more than the equivalent of three years of

full-time coursework.

* * * * * * *

(e) FULL-TIME COURSEWORK.—For purposes of this section, fulltime coursework shall consist of the following:

(1) In the case of undergraduate coursework, 30 semester

hours per undergraduate school year.

(2) In the case of graduate coursework, 18 semester hours per

graduate school year.

* * * * * * *

øSection 7676 is repealed.¿

* * * * * * *

35

§ 7682. Eligibility

* * * * * * *

(a) ELIGIBILITY.—An individual is eligible to participate in the

Education Debt Reduction Program if the individual— (1) is a recently appointed employee in the Veterans Health

Administration serving øunder an appointment under section

7402(b) of this title in a position¿ in a position (as determined

by the Secretary) providing direct-patient care services or services incident to direct-patient care services for which recruitment or retention of qualified health-care personnel ø(as determined by the Secretary)¿ (as so determined) is difficult; and

* * * * * * *

§ 7683. Education debt reduction

* * * * * * *

(d) MAXIMUM ANNUAL AMOUNT.—(1) Subject to paragraph (2),

the amount of education debt reduction payments made to a participant øfor a year¿ under the Education Debt Reduction Program

may not øexceed— ø(A) $6,000 for the first year of the participant’s participation in the Program;

ø(B) $8,000 for the second year of the participant’s participation in the Program; and

ø(C) $10,000 for the third year of the participant’s participation in the Program.

ø(2) The total amount payable to a participant in such Program

for any year may not exceed the amount of the principal and interest on loans referred to in subsection (a) that is paid by the individual during such year.¿ exceed $44,000 over a total of five years

of participation in the Program, of which not more than $10,000 of

such payments may be made in each of the fourth and fifth years

of participation in the Program.

* * * * * * *

øSection 7684 is repealed.¿

* * * * * * *

§ 8110. Operation of medical facilities

(a)(1) The Secretary shall establish the total number of hospital

beds and nursing home beds in medical facilities over which the

Secretary has direct jurisdiction for the care and treatment of eligible veterans at not more than 125,000 and not less than 100,000.

The Secretary shall establish the total number of such beds so as

to maintain a contingency capacity to assist the Department of Defense in time of war or national emergency to care for the casualties of such war or national emergency. Of the number of beds authorized pursuant to the preceding sentence, the Secretary shall

operate and maintain a total of not less than 90,000 hospital beds

and nursing home beds and shall maintain the availability of such

additional beds and facilities in addition to the operating bed level

as the Secretary considers necessary for such contingency purposes.

The President shall include in the Budget transmitted to the Congress for each fiscal year pursuant to section 1105 of title 31, an

amount for medical care and amounts for construction sufficient to

36

enable the Department to operate and maintain a total of not less

than 90,000 hospital and nursing home beds in accordance with

this paragraph and to maintain the availability of the contingency

capacity referred to in the second sentence of this paragraph. The

Secretary shall staff and maintain, in such a manner as to ensure

the immediate acceptance and timely and complete care of patients,

and in a manner consistent with the policies of the Secretary on

overtime, sufficient beds and other treatment capacities to accommodate, and provide such care to, eligible veterans applying for admission and found to be in need of hospital care or medical services.

(2) The Secretary shall maintain the bed and treatment capacities of all Department medical facilities, including the staffing required to maintain such capacities, so as to ensure the accessibility

and availability of such beds and treatment capacities to eligible

veterans in all States øand to minimize¿ to minimize delays in admissions and in the provision of hospital, nursing home, and domiciliary care, and of medical services furnished pursuant to section

1710(a) of this title, and to ensure that eligible veterans are provided such care and services in an appropriate manner. (3)(A) The Under Secretary for Health shall at the end of each

fiscal year (i) analyze agencywide admission policies and the

records of those eligible veterans who apply for hospital care, medical services, and nursing home care, but are rejected or not immediately admitted or provided such care or services, and (ii) review

and make recommendations regarding the adequacy of staff levels

for compliance with the policy established under subparagraph (C),

the adequacy of the established operating bed levels, the geographic distribution of operating beds, the demographic characteristics of the veteran population and the associated need for medical

care and nursing home facilities and services in each State, and the

proportion of the total number of operating beds that are hospital

beds and that are nursing home beds.

* * * * * * *

(C) The Secretary shall, in consultation with the Under Secretary

for Health, establish a nationwide policy on the staffing of Department medical facilities in order to ensure that such facilities have

adequate staff for the provision to veterans of appropriate, highquality care and services. The policy shall take into account the

staffing levels and mixture of staff skills required for the range of

care and services provided veterans in Department facilities.

* * * * * * *

TITLE 5, UNITED STATES CODE

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§ 8415. Computation of basic annuity

* * * * * * *

(i) In computing an annuity under this subchapter, the total service of an employee who retires from the position of a registered nurse

with the Veterans Health Administration on an immediate annuity,

or dies while employed in that position leaving any survivor entitled

37

to an annuity, includes the days of unused sick leave to the credit

of that employee under a formal leave system, except that such days

shall not be counted in determining average pay or annuity eligibility under this subchapter.

* * * * * * *

§ 8422. Deductions from pay; contributions for military service

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(d)(1) Under such regulations as the Office may prescribe,

amounts deducted under subsection (a) shall be entered on individual retirement records.

(2) Deposit may not be required for days of unused sick leave

credited under section 8415(i).

Æ