II

103D CONGRESS

2D SESSION S. 2135

To authorize the Department of Veterans Affairs to conduct pilot programs

for delivering health care services in States which have statutorily reformed their health care systems.

IN THE SENATE OF THE UNITED STATES

MAY 19 (legislative day, MAY 16), 1994

Mr. ROCKEFELLER (by request) introduced the following bill; which was read

twice and referred to the Committee on Veterans’ Affairs

A BILL

To authorize the Department of Veterans Affairs to conduct

pilot programs for delivering health care services in

States which have statutorily reformed their health care

systems.

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled,

3 SECTION 1. SHORT TITLE.

4 This Act shall be cited as the ‘‘VA State Health-Care

5 Reform Pilot Programs Act’’.

6 SEC. 2. DEFINITIONS.

7 For purposes of this Act—
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1 (1) The term ‘‘Department’’ means the Depart2 ment of Veterans Affairs.

3 (2) The term ‘‘family’’ means the spouse of a

4 veteran or a child of a veteran as those terms are

5 defined in section 101 of title 38, United States

6 Code.

7 (3) The term ‘‘pilot program’’ means a program

8 authorized by section 5(a) of this Act.

9 (4) The term ‘‘reformed health-care system’’

10 means a State program which is statutorily estab11 lished by a State that the Secretary determines was

12 established to assure that residents of the State have

13 access to health-care services.

14 (5) The term ‘‘Secretary’’ means the Secretary

15 of Veterans Affairs.

16 (6) The term ‘‘veteran’’ has meaning given such

17 term in section 101(2) of title 38, United States

18 Code.

19 SEC. 3. PILOT PROGRAMS AUTHORITY.

20 (a) AUTHORITY TO CONDUCT PROGRAMS.—In up to

21 five States that have reformed health-care systems, the

22 Secretary may conduct pilot programs under which the

23 Department may provide health care services, directly or

24 by contract, to persons identified in subsection (b) on the
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1 same or similar basis as the State plan mandates for resi2 dents in the State.

3 (b) PERSONS ELIGIBLE FOR SERVICES UNDER PRO4 GRAMS.—Persons eligible to receive services under a pilot

5 program are any residents of the State in which the pilot

6 program is being conducted who are—

7 (1) veterans;

8 (2) individuals eligible for benefits under sec9 tion 1713 of title 38, United States Code; or

10 (3) members of the family of any veteran who

11 participates in a pilot program.

12 (c) AUTHORITY TO COMPLY WITH STATE HEALTH

13 PLAN REQUIREMENTS.—In conducting pilot programs,

14 the Secretary may comply with such requirements of State

15 law applicable to the establishment and operation of a

16 health plan under a State reform plan, or to functioning

17 as a participant in, member of, or contractor to, such a

18 health plan, as the Secretary considers appropriate for ap19 plication to a department or agency of the Federal

20 Government.

21 (d) CATCHMENT AREAS.—In conducting pilot pro22 grams in a State, the Secretary may—

23 (1) conduct the programs in some or all health

24 care facilities of the Department located in the

25 State; and
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1 (2) establish such catchment areas within the

2 State as the Secretary determines appropriate.

3 SEC. 4. CONDITIONS OF PARTICIPATION.

4 (a) CONDITION ON ESTABLISHMENT OF PRO5 GRAMS.—The Secretary may establish and operate a pilot

6 program in a State only after determining, based on such

7 factors as the Secretary considers relevant (including the

8 factors referred to in subsection (b)), that, in the absence

9 of an enrollment option through a Department plan in

10 that State, the projected workload in one or more Depart11 ment health care facilities in the State would decline to

12 a level that—

13 (1) would threaten to impair the capability of

14 such facilities to meet one or more assigned mission

15 of such facilities; or

16 (2) would result in a deterioration in the quality

17 of the service delivered by such facilities to an extent

18 that it would not be reasonable to continue to pro19 vide needed services in such facilities and satisfac20 tory alternative arrangements could not feasibly be

21 provided.

22 (b) FACTORS.—In making a determination under

23 subsection (a), the Secretary shall consider the following:

24 (1) The relative universality of coverage pro25 vided to State residents under the State reform plan.
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1 (2) The scope of benefits offered under the

2 plan.

3 (3) The extent of financing supporting the plan.

4 (4) The extent to which the State may serve as

5 a model for the Department in determining how to

6 compete with other health care providers in other

7 States when Congress enacts National health care

8 reform.

9 (5) Such other matters as the Secretary deter10 mines appropriate.

11 (c) NOTICE AND WAIT REQUIREMENT.—(1) The Sec12 retary may establish and operate a pilot program in a

13 State not earlier than 30 days after submitting to the

14 Committees on Veterans’ Affairs of the Senate and the

15 House of Representatives a report on the pilot program.

16 (2) Each report submitted under paragraph (1) shall

17 include the following:

18 (A) The rationale for proposed participation in

19 the State reform plan.

20 (B) A description of the extent to which appli21 cable provisions of State law specifically accommo22 date and facilitate participation of the Department

23 in the State reform plan.

24 (C) A detailed business plan for the participa25 tion of the Department under the State reform plan.
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1 (D) A description of the actions the Secretary

2 has taken to consult with veterans on the proposed

3 participation of the Department in the State reform

4 plan.

5 (d) REQUIREMENT FOR REGULATIONS.—The Sec6 retary may operate a pilot program in a State only after

7 prescribing implementing regulations.

8 (e) COPAYMENTS.—(1) Except as provided in para9 graph (2), the Secretary shall require persons receiving

10 health care services under a pilot program to pay all pre11 miums, copayments, deductibles, and coinsurance amounts

12 required by State law in the State where the pilot program

13 is undertaken.

14 (2) The Secretary may not collect premiums,

15 copayments, deductibles, and coinsurance amounts under

16 this subsection from the following individuals:

17 (A) Any veteran with a service-connected dis18 ability.

19 (B) any veteran whose discharge or release

20 from the active military, naval or air service was for

21 a disability incurred or aggravated in the line of

22 duty.

23 (C) Any veteran who is in receipt of, or who,

24 but for a suspension pursuant to section 1151 of

25 title 38, United States Code (or both such a suspen-
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1 sion and the receipt of retired pay), would be enti2 tled to disability compensation, but only to the ex3 tent that such a veteran’s continuing eligibility for

4 such care is provided for in the judgment or settle5 ment provided for in such section.

6 (D) Any veteran who is a former prisoner of

7 war.

8 (E) Any veteran of the Mexican border period

9 or World War I.

10 (F) Any veteran who is unable to defray the ex11 penses of necessary care as determined under section

12 1722(a) of title 38, United States Code.

13 SEC. 5. EXPIRATION OF AUTHORITY.

14 The authority to conduct pilot programs under this

15 Act shall expire on December 31, 1997.

16 SEC. 6. FUNDING.

17 (a) REVOLVING FUND.—There is established in the

18 Treasury of the United States a revolving fund for con19 ducting pilot programs authorized by section 3(a).

20 (b) AUTHORIZATION OF APPROPRIATIONS.—There is

21 authorized to be appropriated to the revolving fund for

22 fiscal years 1995, 1996, and 1997 such sums as may be

23 necessary to carry out the purposes of this Act.

24 (c) AVAILABILITY OF FUNDS.—(1) Amounts in the

25 revolving fund established under subsection (a) shall be
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1 available without fiscal year limitation for payment of all

2 expenses necessary to carry out the pilot programs, includ3 ing—

4 (A) expenses of furnishing medical care and

5 services;

6 (B) expenses of consumer surveys;

7 (C) expenses of printing, marketing, and adver8 tising services (including contracts for such serv9 ices); and

10 (D) expenses for the acquisition, construction,

11 repair, or renovation of facilities (including the land

12 on which facilities are located or to be constructed).

13 (2) Funds in the revolving fund shall not be available

14 for a major medical facility project, or a major medical

15 facility lease, under section 8104(a)(3) of title 38, United

16 States Code, unless specifically authorized by law.

17 (d) COLLECTION OF FUNDS.—(1) The Secretary may

18 recover or collect funds which result from participation by

19 the Department in a pilot program authorized under sec20 tion 3(a) for care provided to veterans or their dependents.

21 The Secretary may recover or collect such funds (including

22 amounts received as premiums, copayments, deductibles or

23 third-party reimbursements) from an individual, another

24 agency or department of the Federal Government, an
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1 agency of State or local government, or a health-care pro2 vider, health care plan, insurer, or other entity.

3 (2) The Secretary shall, in consultation with the Di4 rector of the Office of Management and Budget, estimate

5 the collection of funds to be received for services to be

6 provided to veterans by each Department facility partici7 pating in a State pilot program during each fiscal year.

8 Such estimates shall be based upon and consistent with

9 the higher of—

10 (A) the fiscal year baseline for third-party re11 coveries, copayments, and other medical collections

12 for the fiscal year included in the budget submitted

13 to Congress by the President; or

14 (B) the fiscal year baseline for such collections

15 for the fiscal year as reestimated by the Congres16 sional Budget Office.

17 (3)(A) Amounts collected for services provided to de18 pendents shall be deposited in the revolving fund estab19 lished in subsection (a).

20 (B) Amounts collected for services provided to veter21 ans in excess of the estimate determined under paragraph

22 (2) shall be deposited in the revolving fund established

23 under subsection (a).

24 (C) An amount up to the estimate determined under

25 paragraph (2) shall be deposited in the Medical-Care Cost
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1 Recovery Fund established under section 1729(g) of title

2 38, United States Code.

3 SEC. 7. ADMINISTRATIVE FLEXIBILITY.

4 (a) APPLICABILITY OF NOTICE AND WAIT REQUIRE5 MENT.—The Secretary may carry out any reorganization

6 necessary to carry out a pilot program authorized by sec7 tion 3(a) without regard to the provisions of section

8 510(b) of title 38, United States Code.

9 (b) APPLICABILITY OF OTHER PROVISIONS OF

10 LAW.—The Director of a Department health care facility

11 participating in a pilot project authorized by section 3(a)

12 may enter into agreements with health care plans, insur13 ers, health care providers, or with any other entity or indi14 vidual to furnish or obtain any health care resource, as

15 that term is defined in section 8152 of title 38, United

16 States Code, without regard to the following:

17 (1) Chapter 7 of the Office of Federal Procure18 ment Policy Act (41 U.S.C. 410 et. seq.).

19 (2) Chapter 4 of the Federal Property and Ad20 ministrative Services Act of 1949 (41 U.S.C. 251 et

21 seq.).

22 (3) Subsections (b)(7), (e), (f), (g), and (h) of

23 section 8 of the Small Business Act (15 U.S.C.

24 637), relating to certificate of competency, notice,

25 and sole sourcing.
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1 (4) Office of Management and Budget Circular

2 A–76.

3 (5) Section 8110(c) of title 38, United States

4 Code, relating to contracting out at Department

5 medical facilities.

6 (6) Subchapter V of chapter 35 of title 31,

7 United States Code, relating to Government Ac8 counting Office protests.

9 (7) Sections 3526 and 3702 of title 31, United

10 States Code, relating to jurisdiction over Govern11 ment Accounting Office protests.

12 (8) Section 1491 of title 28, United States

13 Code, relating to protests to the United States Court

14 of Federal Claims.

15 (9) Section 702 of title 5, United States Code,

16 and section 1346(2) of title 28, United States Code,

17 relating to protests to United States district courts.

18 (10) Section 8125 of title 38, United States

19 Code, relating to local contracts for health care

20 items.

21 (11) The provisions of law appearing as sec22 tions 471 through 544 of title 40, United States

23 Code, for purposes of the proposal of the Law Revi24 sion Counsel of a codification of Federal law, relat-
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1 ing to the authority of the General Services Admin2 istration over leasing and disposal of property.

3 (12) Section 8122(a)(1) of title 38, United

4 States Code, relating to out-leasing by the Depart5 ment.

6 SEC. 8. MARKETING.

7 The Secretary may carry out such promotional, ad8 vertising, and marketing activities as the Secretary consid9 ers necessary to effectively establish and operate a health

10 plan pilot program.

11 SEC. 9. REPORTS.

12 Not later than November 30 of each of 1995 through

13 1998, the Secretary shall submit to the Committees on

14 Veterans’ Affairs of the Senate and the House of Rep15 resentatives a report on the pilot programs carried out by

16 the Secretary under this Act.

17 SEC. 10. SAVINGS PROVISIONS.

18 (a) BENEFITS.—The Secretary shall provide the per19 sons referred to in section 3(b) with all benefits authorized

20 to be provided to such persons under title 38, United

21 States Code, in accordance with the terms and conditions

22 applicable to such persons and such benefits, notwith23 standing that such benefits are not provided under the

24 pilot program.
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1 (b) UTILIZATION OF OTHER DEPARTMENT FACILI2 TIES.—Department facilities not participating in pilot pro3 grams shall continue to furnish health care benefits in ac4 cordance with the provisions of title 38, United States

5 Code.

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