I

104TH CONGRESS

2D SESSION H. R. 3950

To amend title 38, United States Code, to reorganize the veterans health

system; to improve access to, and the quality and efficiency of, care

provided to the Nation’s veterans; to operate the veterans health system

based on the principles of managed care, and for other purposes.

IN THE HOUSE OF REPRESENTATIVES

AUGUST 2, 1996

Mr. LONGLEY introduced the following bill; which was referred to the

Committee on Veterans’ Affairs

A BILL

To amend title 38, United States Code, to reorganize the

veterans health system; to improve access to, and the

quality and efficiency of, care provided to the Nation’s

veterans; to operate the veterans health system based

on the principles of managed care, and for other purposes.

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; TABLE OF CONTENTS.

4 (a) SHORT TITLE.—This Act may be cited as the ‘‘GI

5 Bill of Health’’.
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1 (b) TABLE OF CONTENTS.—The table of contents of

2 this Act is as follows:

Sec. 1. Short title; table of contents.

Sec. 2. Findings.

Sec. 3. Purposes.

Sec. 4. Veterans Health Care Security.

Sec. 5. Technical and conforming amendments to chapter 17 of title 38, United

States Code.

Sec. 6. Technical and conforming amendments to title 38, United States Code.

Sec. 7. Effective date.

3 SEC. 2. FINDINGS.

4 The Congress finds as follows:

5 (1) The Veterans Health Administration of the

6 Department of Veterans Affairs operates one of the

7 Nation’s largest hospital and health care systems,

8 consisting of 172 medical centers, 375 ambulatory

9 clinics, 133 nursing homes, 39 domicilaries and 202

10 counseling centers.

11 (2) The veterans health system is a national re12 source which must be preserved to ensure that all

13 deserving veterans, including those who have suf14 fered service-connected disabilities, receive the spe15 cialized care which only that system provides.

16 (3) The costs of operating the veterans health

17 system have increased substantially in recent years,

18 thus jeopardizing the ability of the Veterans Health

19 Administration to provide needed services to eligible

20 veterans under funding levels established by law.
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1 (4) In response to escalating costs and the lim2 ited availability of appropriated funds, the Depart3 ment of Veterans Affairs has imposed a complex set

4 of restrictions on access to the veterans health sys5 tem, thereby reducing eligibility for care and dis6 couraging otherwise-eligible veterans from seeking

7 care.

8 (5) Restrictions on eligibility for services and

9 access to the veterans health system, imposed as

10 cost-control measures, defeat the purpose for which

11 the system was established an undermine the com12 pact between the United States and those who have

13 served in uniform.

14 (6) The Nation’s 27,000,000 veterans of mili15 tary service, having sacrificed to protect their coun16 try, now require a veterans health system which pro17 vides comprehensive care for themselves and their

18 dependents; one which provides services necessary

19 for the treatment of service-connected disabilities at

20 no charge, and provides other services on a cost-re21 covery basis where the veteran has health insurance

22 or resources otherwise adequate for payment.

23 (7) The veterans health system in order to offer

24 comprehensive services must be reorganized based

25 upon the principles of managed care and have the
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1 authority to recover costs, where appropriate, for

2 providing such services.

3 SEC. 3. PURPOSES.

4 The purposes of this Act are as follows:

5 (1) To reorganize the veterans health system to

6 improve access to, and the quality and efficiency of,

7 care for the Nation’s veterans.

8 (2) To operate the veterans health system based

9 upon the principles of managed care.

10 (3) To ensure all veterans with service-con11 nected disabilities have access to all services nec12 essary for the treatment of such disabilities at no

13 charge.

14 (4) To ensure all special-category veterans, as

15 defined in law, along with indigent veterans and vet16 erans with service-connected disabilities, receive a

17 continuum of health care services at no charge or re18 duced charge.

19 (5) To control the cost of operating the veter20 ans health care system by encouraging veterans who

21 do not currently receive care in Department of Vet22 erans Affairs facilities to enroll in Veterans Health

23 Plans.

24 (6) To improve the long-term financial health of

25 the veterans health system by attracting resources
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1 into the system from other Federal programs, third2 party payers, and employers of veterans.

3 (7) To permit the veterans health system to re4 tain all payments made to the Department of Veter5 ans Affairs for health care services.

6 (8) To eliminate unnecessary, duplicative, or

7 contradictory regulations that hamper the ability of

8 the veterans health system to operate effectively and

9 efficiently.

10 SEC. 4. VETERANS HEALTH CARE SECURITY.

11 Title 38, United States Code, is amended by inserting

12 after chapter 17 the following new chapter:

‘‘CHAPTER 18—VETERANS HEALTH SYSTEM

‘‘SUBCHAPTER I—ENROLLMENT

Sec.

‘‘1801. Enrollment of veterans.

‘‘1802. Enrollment of veterans’ dependents.

‘‘1803. Enrollment of CHAMPVA eligibles.

‘‘1804. Enrollment process.

‘‘SUBCHAPTER II—ELIGIBILITY

‘‘1805. Eligibility definitions.

‘‘1806. Eligibility for benefits.

‘‘SUBCHAPTER III—BENEFITS

‘‘1807. Basic benefits package.

‘‘1808. Comprehensive benefits package.

‘‘1809. Supplemental health benefits packages.

‘‘SUBCHAPTER IV—PAYMENT POLICIES

‘‘1810. Payment policies for entitled veterans.

‘‘1811. Payment policies for certain veterans and veterans’ dependents enrolled

in a Veterans Health Plan.

‘‘1812. Payment policies for veterans eligible for federally-administered health

care programs.

‘‘1813. Payment policies for eligible veterans and veterans’ dependents with

Medicare Supplemental health insurance coverage.

‘‘1814. Payment policies for fee-for-service benefits.
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‘‘SUBCHAPTER V—FINANCING

‘‘1815. Creation of Department of Veterans Affairs Health Plan Fund.

‘‘1816. Guaranteed funding of Federal Costs.

‘‘1817. Resource allocation.

‘‘SUBCHAPTER VI—DELIVERY OF HEALTH CARE SERVICES

‘‘1818. Responsibilities of the Secretary of Veterans Affairs.

‘‘1819. Responsibilities of Veterans Health Plans and Veterans Health Plan

Directors.

‘‘SUBCHAPTER VII—STATE HEALTH CARE SYSTEMS

‘‘1820. State health care reform.

‘‘1821. Applicability of State law.

‘‘1823. General definitions.

‘‘SUBCHAPTER VIII—GENERAL PROVISIONS

‘‘1822. Budget reporting requirements.

1 ‘‘SUBCHAPTER I—ENROLLMENT

2 ‘‘§ 1801. Enrollment of veterans

3 ‘‘The Secretary shall establish a process for the en4 rollment into Veterans Health Plans of entitled and eligi5 ble veterans.

6 ‘‘§ 1802. Enrollment of veterans’ dependents

7 ‘‘The Secretary shall establish a process for the en8 rollment into Veterans Health Plans of the dependents of

9 enrolled veterans, as defined in section 1805(c) of this

10 title.

11 ‘‘§ 1803. Enrollment of CHAMPVA eligibles

12 ‘‘The Secretary shall establish a process for the en13 rollment into Veterans Health Plans, in the same manner

14 as a veteran, of individuals who are eligible for benefits

15 under section 1713 of this title.
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1 ‘‘§ 1804. Enrollment process

2 ‘‘(a) The Secretary shall provide for a continuous

3 open enrollment period of 18 months following implemen4 tation of the GI Bill of Health, during which period enti5 tled and eligible veterans and their dependents may first

6 enroll in a Veterans Health Plan.

7 ‘‘(b) For each entitled or eligible veteran, when the

8 veteran first becomes eligible to enroll in a Veterans

9 Health Plan, there shall be an initial enrollment period

10 of not less than 30 days during which the veteran may

11 first enroll in such Veterans Health Plan.

12 ‘‘(c) The Secretary shall establish an annual period

13 of not less than 30 days during which entitled and eligible

14 veterans may enroll in a Veterans Health Plan. Such an15 nual enrollment period shall coincide with the annual open

16 season under the Federal Employees Health Benefits Pro17 gram as established under chapter 89 of title 5. All Veter18 ans Health Plans shall designate the same annual enroll19 ment period.

20 ‘‘(d) If a veteran enrolls in a Veterans Health Plan,

21 such veteran may at the same time enroll the veteran’s

22 dependents in the Plan as a family enrollment.

23 ‘‘(e) In the case of a veteran who experiences a

24 change of family composition through marriage, divorce,

25 birth or adoption of a child, or similar circumstances, the

26 Secretary shall provide for a special enrollment period in
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1 which the veteran is eligible to change the individual or

2 family basis of enrollment in a Veterans Health Plan.

3 ‘‘(f) Enrollment of a dependent of an enrolled veteran

4 shall be considered timely if a request for enrollment is

5 made within 30 days of a marriage or birth or adoption

6 of a child if family coverage is available as of such date.

7 ‘‘(g) Dependent coverage shall become effective on

8 the date of the marriage of a spouse or the date of the

9 birth or adoption of a child.

10 ‘‘(h) Coverage of a dependent under a policy under

11 this chapter may not be canceled by reason of the death

12 of the veteran, except that coverage of a dependent spouse

13 or child of a spouse may be canceled in the event that

14 the spouse remarries, unless such remarriage is annulled

15 or made void by a court of law.

16 ‘‘(i) The Secretary may terminate coverage for non17 payment of premiums.

18 ‘‘(j) The Secretary shall guarantee that the terms of

19 coverage, including the amount of any premiums or other

20 cost-sharing requirements, and the availability of benefits

21 shall not be changed for a full enrollment period of not

22 less than one year, notwithstanding an enrolled veteran’s

23 change in income or degree of service-connected disability,

24 except that the Secretary shall have the discretion to re25 duce or eliminate the premium and cost-sharing charges
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1 for any veterans who qualified as entitled under section

2 1805(a)(8) of this title.

3 ‘‘SUBCHAPTER II—ELIGIBILITY

4 ‘‘§ 1805. Eligibility definitions

5 ‘‘(a) An ‘entitled’ veteran under this chapter includes

6 the following categories of veterans:

7 ‘‘(1) Any veteran with a service-connected dis8 ability.

9 ‘‘(2) Any veteran whose discharge or release

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

11 a disability incurred or aggravated in the line of

12 duty.

13 ‘‘(3) Any veteran who is in receipt of, or who,

14 but for a suspension pursuant to section 1151 of

15 this title (or both such a suspension and the receipt

16 of retired pay), would be entitled to disability com17 pensation, but only to the extent that such a veter18 an’s continuing eligibility for such care is provided

19 for in the judgment or settlement provided for in

20 such section.

21 ‘‘(4) Any veteran who is a former prisoner of

22 war.

23 ‘‘(5) Any veteran of the Mexican border period

24 or World War I.
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1 ‘‘(6) Any veteran who is unable to defray the

2 expenses of necessary care as determined under sec3 tion 1722(a) of this title.

4 ‘‘(7) Any veteran who served on active duty in

5 the Republic of Vietnam during the Vietnam era and

6 who the Secretary finds may have been exposed dur7 ing such service to dioxin or was exposed during

8 such service to a toxic substance found in a herbi9 cide or defoliant used in connection with military

10 purposes during that era, notwithstanding that there

11 may be insufficient medical evidence to conclude that

12 such illness or disability may be associated with such

13 exposure.

14 ‘‘(B) Any veteran who the Secretary finds was

15 exposed to ionizing radiation from the detonation of

16 a nuclear device in connection with such veteran’s

17 participation in the test of such a device or with the

18 American occupation of Hiroshima and Nagasaki,

19 Japan, during the period beginning on September

20 11, 1945, and ending on July 1, 1946, notwith21 standing that there may be insufficient medical evi22 dence to conclude that such illness or disability may

23 be associated with such exposure.

24 ‘‘(C) Any veteran who served on active duty in

25 the Southwest Asia theater of operations during the
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1 Persian Gulf War and who the Secretary finds has

2 an illness or disability which may be associated with

3 exposure to a toxic substance or environmental haz4 ard, notwithstanding that there may be insufficient

5 medical evidence to conclude that such illness or dis6 ability may be associated with such exposure.

7 ‘‘(D) Any veteran who while on active duty was

8 exposed to mustard gas while participating in full9 body, field, or chamber experiments to test protec10 tive clothing or equipment during World War II and

11 who the Secretary finds has an illness or disability

12 which may be associated with such exposure, not13 withstanding that there may be insufficient medical

14 evidence to conclude that such illness or disability

15 may be associated with such exposure.

16 ‘‘(8) Any veteran who suffers a catastrophic ill17 ness or injury, payment for which would render such

18 veteran destitute as determined under criteria estab19 lished by the Secretary.

20 ‘‘(9) Any veteran proven to be uninsurable in

21 the private health insurance market, as determined

22 under criteria established by the Secretary.

23 ‘‘(b) An ‘eligible’ veteran under this chapter shall in24 clude all veterans who do not qualify under subsection (a)

25 as ‘entitled’.
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1 ‘‘(c) A ‘dependent of a veteran’ under this chapter

2 shall include, for any veteran enrolled in a Veterans

3 Health Plan—

4 ‘‘(1) a spouse;

5 ‘‘(2) a widow or widower who has not remar6 ried, unless such remarriage has been annulled or

7 made void by a court of law; and

8 ‘‘(3) an unmarried child, spouse’s child or

9 adopted child who—

10 ‘‘(A) has not attained the age of 21;

11 ‘‘(B) has not attained the age of 23, is en12 rolled in a full-time course of study at an insti13 tution of higher learning, and is in fact depend14 ent on the veteran for one half of the child’s

15 support; or

16 ‘‘(C) is incapable of self-support due to a

17 mental or physical incapacity that occurs while

18 a dependent of a veteran under subparagraph

19 (A) or (B), and is in fact dependent on the vet20 eran for one half of the child’s support.

21 § 1806. Eligibility for benefits

22 ‘‘(a) Upon enrollment in a Veterans Health Plan, a

23 veteran who qualifies as entitled under section 1805(a)(1)

24 of this title shall receive—
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1 ‘‘(1) any medically necessary and appropriate

2 care and services associated with such service-con3 nected disability or illness; and

4 ‘‘(2) any medically necessary and appropriate

5 care and services for an established disability or ill6 ness determined to be proximately due to or the re7 sult of such service-connected disability or illness, in

8 the same manner and to the same extent as if such

9 disability or illness is service-connected.

10 ‘‘(b)(1) Upon enrollment in a Veterans Health Plan,

11 a veteran who qualifies as entitled under section

12 1805(a)(1) of this title and has a service-connected dis13 ability rated 50 percent or greater shall receive the medi14 cally necessary and appropriate care and services included

15 in the comprehensive benefits package, as defined in sec16 tion 1808 of this title, and the specialized services supple17 mental health benefits package, as defined in section

18 1809(a) of this title, and any care and services otherwise

19 provided under the terms and conditions of chapter 17 of

20 this title.

21 ‘‘(2) Upon enrollment in a Veterans Health Plan, a

22 veteran who qualifies as entitled under section 1805(a)(1)

23 of this title and has a comprehensive service-connected dis24 ability rated less than 50 percent shall—
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1 ‘‘(A) receive the medically necessary and appro2 priate care and services in the basic benefits package

3 as defined in section 1807 of this title; or

4 ‘‘(B) be eligible to purchase the comprehensive

5 benefits package, as defined in section 1808 of this

6 title, at a premium discount, as set forth in sub7 section (f).

8 The care and services provided in this subsection shall be

9 in addition to care and services provided under subsection

10 (a).

11 ‘‘(3) Upon enrollment in a Veterans Health Plan, a

12 veteran who qualifies as entitled under sections

13 1805(a)(2)–(a)(9) of this title shall receive the medically

14 necessary and appropriate care and services included in

15 the basic benefits package as defined in section 1807 of

16 this title. When determined by a health care provider em17 ployed by or under contract with the Department under

18 guidelines established by the Secretary, such veteran may

19 also receive additional, specific and medically-appropriate

20 care and services included in chapters 17 and 18 of this

21 title when such care is deemed related to the cir22 cumstances of such veteran’s entitlement.

23 ‘‘(c)(1) A veteran who qualifies as eligible under sec24 tion 1805(b) of this title may enroll in a Veterans Health

25 Plan to receive the medically necessary and appropriate
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1 care and services included in the basic, comprehensive, or

2 supplemental health benefits packages, as defined in sec3 tions 1807, 1808, and 1809 of this title, respectively.

4 ‘‘(2) A veteran who qualifies as entitled under section

5 1805(a)(1) of this title and has a non-compensable serv6 ice-connected disability shall be eligible to enroll in a Vet7 erans Health Plan on the same basis as a veteran who

8 qualifies as eligible under subsection 1805(b) of this title.

9 The care and services provided under this paragraph shall

10 be in addition to care and services provided under sub11 section (a).

12 ‘‘(d) A dependent of an enrolled veteran may enroll

13 in a Veterans Health Plan to receive the medically nec14 essary and appropriate services included in the basic, com15 prehensive, or supplemental health benefits package as de16 fined in sections 1807, 1808, and 1809(c) of this title,

17 respectively. A dependent of a veteran may not receive the

18 specialized services supplemental health benefits package

19 defined in section 1809(a) and (b) of this title.

20 ‘‘(e) A veteran may receive the medically necessary

21 and appropriate care and services contained in the com22 prehensive benefits package, defined in section 1808 of

23 this title, or a supplemental health benefits package, de24 fined in section 1809 of this title, with the exception of
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1 the long term care benefits provided under subsection (b)

2 of such section, on a fee-for-service basis.

3 ‘‘(f) A veteran who qualifies as entitled under section

4 1805(a)(1) of this title and has a compensable service-con5 nected disability rated at less than 50 percent and enrolls

6 in a Veterans Health Plan to receive the care and services

7 included in the comprehensive health benefits package, as

8 defined in section 1808 of this title, in accordance with

9 subsection (b), shall be eligible to receive from the Sec10 retary a premium discount equal to—

11 ‘‘(1) 80 percent of the individual premium, for

12 a veteran with a service-connected disability rated at

13 40 percent;

14 ‘‘(2) 60 percent of the individual premium, for

15 a veteran with a service-connected disability rated at

16 30 percent;

17 ‘‘(3) 40 percent of the individual premium, for

18 a veteran with a service-connected disability rated at

19 20 percent; and

20 ‘‘(4) 20 percent of the individual premium, for

21 a veteran with a service-connected disability rated at

22 10 percent.

23 ‘‘(g) The Secretary shall guarantee that the terms of

24 coverage under a Veterans Health Plan benefits package,

25 including the amount of any premium or other cost-shar-
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1 ing requirement, and the availability of benefits under a

2 Veterans Health Plan benefits package, shall not be

3 changed for a full enrollment period of not less than one

4 year, notwithstanding an enrolled veteran’s change in in5 come or degree of service-connected disability, except that

6 the Secretary shall have the discretion to reduce or elimi7 nate the premium and cost-sharing charges for any vet8 eran who qualifies under section 1805(a)(8) of this title.

9 ‘‘SUBCHAPTER III—BENEFITS

10 ‘‘§ 1807. Basic benefits package

11 ‘‘(a) The Secretary shall have the authority to estab12 lish a basic benefits package consisting of the following

13 items, care, and services:

14 ‘‘(1) Hospital services.

15 ‘‘(2) Services of health professionals.

16 ‘‘(3) Women’s health services.

17 ‘‘(4) Medical and surgical services.

18 ‘‘(5) Outpatient services.

19 ‘‘(6) 24-hour emergency services.

20 ‘‘(7) Preventive health care services, including

21 those services defined in section 1701(9) of this title.

22 ‘‘(8) Diagnostic services.

23 ‘‘(b) The Secretary shall establish an individual and

24 family schedule of premiums, deductibles, copayments,

25 and coinsurance charges for the basic benefits package
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1 created under this section, based upon the fully-allocated

2 cost to provide the items, care, and services set forth in

3 this section. The annual deductible under the basic bene4 fits package shall be set a rate equivalent to two times

5 the deductible established under section 1808(b) of this

6 title for the comprehensive benefits package.

7 ‘‘(c) The Secretary shall not be required to provide

8 any care or service listed in the basic benefits package cre9 ated under this section within a Department facility, so

10 long as such service is provided through a provider con11 tract, medical resource-sharing agreement, or similar ar12 rangement.

13 ‘‘§ 1808. Comprehensive benefits package

14 ‘‘(a) The Secretary shall have the authority to estab15 lish a comprehensive benefits package consisting of the fol16 lowing items, care, and services:

17 ‘‘(1) Hospital services, including psychiatric

18 hospital care.

19 ‘‘(2) Services of health professionals.

20 ‘‘(3) Medical and surgical services.

21 ‘‘(4) Outpatient services.

22 ‘‘(5) 24-hour emergency services.

23 ‘‘(6) Preventive care services, including those

24 services defined in section 1701(9) of this title.

25 ‘‘(7) Diagnostic services.
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1 ‘‘(8) Women’s health services.

2 ‘‘(9) Pediatric services.

3 ‘‘(10) Mental health and substance abuse pre4 vention and treatment.

5 ‘‘(11) Hospice care.

6 ‘‘(12) Home health care.

7 ‘‘(13) Extended care services.

8 ‘‘(14) Authorized transportation services.

9 ‘‘(15) Durable medical equipment.

10 ‘‘(16) Outpatient prescription drugs and

11 biologicals.

12 ‘‘(17) Investigational devices and treatments.

13 ‘‘(18) Routine vision testing and eye care serv14 ices.

15 ‘‘(b) The Secretary shall establish an individual and

16 family schedule of premiums, deductibles, copayments,

17 and coinsurance charges for the comprehensive benefits

18 package created under this section, based upon the fully19 allocated cost to provide the items, care, and services set

20 forth in this section.

21 ‘‘(c) The Secretary shall have the discretion to add

22 benefits to the comprehensive benefits package created

23 under this section upon a finding that such additional ben24 efits are necessary to provide effective and cost-efficient

25 health care to veterans.
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1 ‘‘(d) The Secretary shall not be required to provide

2 any care or service listed in the comprehensive benefits

3 package created under this section within a Department

4 facility, so long as such care or service provided through

5 a provider contract, medical resource-sharing agreement,

6 or similar arrangement.

7 ‘‘§ 1809. Supplemental health benefits packages

8 ‘‘(a)(1) The Secretary shall provide to veterans the

9 care and services authorized under chapter 17 of this title

10 in accordance with the terms and conditions applicable to

11 such care and services under such chapter, notwithstand12 ing whether such care and services are included in the

13 basic or comprehensive benefits packages established

14 under sections 1807 and 1808 of this title, respectively.

15 Care and services provided under this subsection shall be

16 administered by Veterans Health Plans as a specialized

17 services supplemental health benefits package and shall in18 clude prosthetic and orthotic services, blind rehabilitation

19 services, services necessary for the rehabilitation of veter20 ans with spinal cord dysfunction, and treatment for chron21 ic psychiatric illnesses such as Post Traumatic Stress Dis22 order (PTSD). The specialized services supplemental

23 health care benefits package may include long-term care

24 services only to the extent provided under subsection (b).
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1 ‘‘(2)(A) In order to meet the special needs of veter2 ans, the Secretary may offer to veterans described in sub3 paragraph (B) one or more supplemental health benefits

4 packages for care and services provided under chapter 17

5 of this title but not otherwise included in the basic or com6 prehensive benefits packages established under sections

7 1807 and 1808 of this title, respectively, and not otherwise

8 provided under subsection (b).

9 ‘‘(B) A veteran may be offered a specialized services

10 supplemental health benefits package under this sub11 section only if such veteran does not otherwise qualify to

12 receive such care and services under paragraph (1).

13 ‘‘(C) The Secretary shall establish premiums,

14 deductibles, copayments, and coinsurance charges for a

15 specialized services supplemental health benefits package

16 based upon the fully-allocated cost to provide such serv17 ices.

18 ‘‘(b) The Secretary shall have the discretion to pro19 vide long-term care services (including nursing home care,

20 domiciliary care, respite care, adult day care, home health

21 care, and community residential care) to veterans under

22 the authority provided in chapter 17 of this title in accord23 ance with the terms and conditions to such care under

24 such chapter.
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1 ‘‘(c)(1) The Secretary may establish and offer to vet2 erans and veterans’ dependents supplemental health bene3 fits packages for care and services, not otherwise provided

4 in the basic, comprehensive or specialized services supple5 mental health benefits packages established in sections

6 1807, 1808, and 1809(a) of this title, respectively.

7 ‘‘(2) The Secretary shall establish a schedule of pre8 miums, deductibles, copayments, and coinsurance charges

9 for supplemental health benefits packages established

10 under this subsection, based upon the fully-allocated cost

11 to provide such care and services. For the purposes of

12 paragraph (1), such schedule shall include both an individ13 ual and a family rate.

14 ‘‘SUBCHAPTER IV—PAYMENT POLICIES

15 ‘‘§ 1810. Payment policies for entitled veterans

16 ‘‘(a) The Secretary may not impose any charge

17 (whether a premium, deductible, copayment, coinsurance,

18 or other amount)—

19 ‘‘(1) for any medically necessary and appro20 priate care or services provided under section

21 1806(a) of this title to a veteran who qualifies as en22 titled under section 1805(a)(1) of this title;

23 ‘‘(2) for any medically necessary and appro24 priate care or services provided under section

25 1806(b)(1) of this title to a veteran who qualifies as
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1 entitled under section 1805(a)(1) of this title and

2 has a service-connected disability rated at 50 percent

3 or greater;

4 ‘‘(3) for any medically necessary and appro5 priate care or services provided under section

6 1806(b)(2)(A) of this title to a veteran who qualifies

7 as entitled under section 1805(a)(1) of this title and

8 has a compensable service connected disability rated

9 at less than 50 percent and does not choose to pur10 chase the comprehensive benefits package under sec11 tion 1806(b)(2)(B) of this title; or

12 ‘‘(4) for any medically necessary and appro13 priate care or services provided under section

14 1806(b)(3) of this title to a veteran who qualifies as

15 entitled under sections 1805(a)(2)–(a)(9) of this

16 title.

17 ‘‘(b) The Secretary shall grant a premium discount

18 for the purchase of the comprehensive benefits package

19 established in section 1808 of this title in accordance with

20 the provisions of section 1806(f) of this title for any medi21 cally necessary and appropriate care and services provided

22 under section 1806(b)(2)(B) of this title. Such premium

23 discount shall be based upon the individual premiums es24 tablished under section 1808(b) of this title.
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1 ‘‘§ 1811. Payment policies for certain veterans and

2 veterans’ dependents enrolled in a Veter3 ans Health Plan

4 ‘‘The Secretary shall establish premiums, copay5 ments, deductibles, and coinsurance charges for care and

6 services provided under sections 1807, 1808 and 1809 of

7 this title to veterans and veterans’ dependents who enroll

8 in a Veterans Health Plan to receive such care and serv9 ices under sections 1806(c), 1806(d), 1809(a)(2) and

10 1809(c) of this title. The Secretary shall set such rates

11 based upon the fully-allocated cost to provide care. The

12 cost to provide care shall not take into account costs other13 wise recovered by the Secretary under section 1816 of this

14 title.

15 ‘‘§ 1812. Payment policies for veterans eligible for

16 federally-administered health care pro17 grams

18 ‘‘(a) For purposes of this section, the term ‘federally19 administered health care program’ shall include Medicare

20 and Medicaid, as established in the Social Security Act;

21 the Civilian Health and Medical Program of the Uni22 formed Services (CHAMPUS), as established under chap23 ter 55 of title 10 or its successor; the Federal Employees

24 Health Benefits Program (FEHBP), as established under

25 chapter 89 of title 5; and the Indian Health Service (IHS),
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1 as established under the Indian Health Care Improvement

2 Act (25 U.S.C. 1601 et seq.).

3 ‘‘(b) For purposes of any federally-administered

4 health care program, a Veterans Health Plan or Depart5 ment facility shall be deemed to be a qualified provider

6 or carrier, notwithstanding any other provision of law.

7 ‘‘(c) The Secretary of health and Human Services,

8 the Director of the Office of Personnel Management, the

9 Secretary of the Interior, the Secretary of Defense, and

10 any other administrator of a federal health care program

11 shall enter into an agreement with the Secretary to treat

12 the Veterans Health Plan as a qualified provider or car13 rier, including treatment as a qualified Medicare Health

14 Maintenance Organization as defined in section 1876 of

15 the Social Security Act, for veterans covered by this chap16 ter, in any case in which the Secretary seeks to enter into

17 such an agreement.

18 ‘‘(d) In the case of care provided under this chapter

19 to a veteran who is eligible for benefits under a federally20 administered health care program, the federally-adminis21 tered health care program shall reimburse the Veterans

22 Health Plan or facility providing services as a qualified

23 provider on the same basis as that program reimburses

24 other qualified providers.

25 ‘‘(e) When the Secretary provides care—
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1 ‘‘(1) under section 1806(a) of this title to a vet2 eran who qualifies as entitled under section

3 1805(a)(1) of this title;

4 ‘‘(2) under section 1806(b)(1) of this title to a

5 veteran who qualifies as entitled section 1805(a)(1)

6 of this title and has a service-connected disability

7 rated at 50 percent or greater;

8 ‘‘(3) under section 1806(b)(2)(a) of this title to

9 a veteran who qualifies as entitled under section

10 1805(a)(1) of this title and has a compensable serv11 ice-connected disability rated at less than 50 percent

12 and does not choose under section 1806(b)(2)(B) of

13 this title to purchase the comprehensive benefits

14 package established in section 1808 of this title; or

15 ‘‘(4) under section 1806(b)(3) of this title to a

16 veteran who qualifies as entitled under sections

17 1805(a)(2)–(a)(9) of this title;

18 the veteran shall not be required to pay any otherwise ap19 plicable deductible or copayment that is not covered by

20 the federally-administered health program, notwithstand21 ing any other provision of law.

22 ‘‘(f) When the Secretary provides care to any veteran

23 not described in subsection (e), the Secretary shall require

24 such veteran to pay to the Veterans Health Plan any oth-
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1 erwise applicable deductible or copayment that is not cov2 ered by the federally-administered health program.

3 ‘‘§ 1813. Payment policies for eligible veterans and

4 veterans’ dependents with Medicare Sup5 plemental health insurance coverage

6 ‘‘When the Secretary provides care on an enrolled or

7 fee-for-service basis to—

8 ‘‘(1) a veteran described in section 1806(c) of

9 this title who has coverage under a Medicare Supple10 mental health insurance plan as established under

11 the Social Security Act; or

12 ‘‘(2) a veteran’s dependent who has coverage

13 under a Medicare Supplemental health insurance

14 plan as established under the Social Security Act;

15 the Secretary has the authority to establish, charge,

16 recover and collect payment for such care or services

17 from the Medicare Supplemental health insurance

18 plan to the extent that the veteran or veteran’s de19 pendent (or the provider of the care or services)

20 would be eligible to receive payment for such care or

21 services from such party if the care or services had

22 not been furnished by the Secretary.

23 ‘‘§ 1814. Payment policies for fee-for-service benefits

24 ‘‘The Secretary shall establish and charge rates for

25 care and services provided to veterans who elect to obtain
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1 services in a Veterans Health Plan on a fee-for-service

2 basis without enrolling in a Veterans Health Plan. Such

3 rates shall be based upon the fully-allocated cost to provide

4 the care and services received.

5 ‘‘SUBCHAPTER V—FINANCING

6 ‘‘§ 1815. Creation of Department of Veterans Affairs

7 Health Plan Fund

8 ‘‘(a)(1) There is hereby established in the Treasury

9 a revolving fund to be known as Department of Veterans

10 Affairs Health Plan Fund (Veterans Health Plan Fund).

11 ‘‘(2) The Secretary of the Treasury shall deposit into

12 the Veterans Health Plan Fund the balance of funds re13 maining in the Medical-Care Cost Recovery Fund as of

14 the date of the enactment of this chapter. If the balance

15 in the Medical-Care Cost Recovery Fund on that date is

16 less than $0, $0 shall be credited to the Veterans Health

17 Plan Fund.

18 ‘‘(b) Any amount received by the Department by rea19 son of the furnishing of health care services to a veteran

20 or veteran’s dependent, including amounts received as pre21 miums, copayments, coinsurance, deductibles, reimburse22 ments from private health insurance or federally-adminis23 tered health plans and from other out-of-pocket payments

24 made by veterans, shall be credited to the Veterans Health

25 Plan Fund.
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1 ‘‘(c) Amounts in the Veterans Health Plan Fund

2 shall be available until expended by the Secretary for the

3 delivery of health care services under chapters 17 and 18

4 of this title.

5 ‘‘§ 1816. Guaranteed funding of Federal costs

6 ‘‘(a) The Secretary of the Treasury shall deposit into

7 the Veterans Health Plan Fund on the first day of each

8 fiscal-year quarter, from amounts not otherwise appro9 priated, the amount certified to the Secretary of the

10 Treasury under subsection (b) with respect to that quar11 ter.

12 ‘‘(b) Not later than 30 days before the beginning of

13 each fiscal-year quarter, the Secretary of Veterans Affairs

14 shall certify to the Secretary of the Treasury the amount

15 determined for that quarter under this subsection.

16 ‘‘(1) The amount to be certified to the Sec17 retary of the Treasury for any fiscal-year quarter

18 shall be the amount equal to—

19 ‘‘(A) the product of—

20 ‘‘(i) the projected number of veterans

21 who qualify as entitled under section

22 1805(a)(1) of this title and have a service23 connected disability rated at 50 percent

24 plus the projected number of veterans who
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1 qualify as entitled under section

2 1805(a)(2)–(a)(9) of this chapter; and

3 ‘‘(ii) the capitated enrollment amount

4 for such categories of veterans; plus

5 ‘‘(B) the product of—

6 ‘‘(i) the projected number of veterans

7 who qualify as entitled under section

8 1805(a)(1) of this title and have a compen9 sable service-connected disability rated at

10 less than 50 percent; and

11 ‘‘(ii) the capitated enrollment amount

12 for such category of veterans; plus

13 ‘‘(C) the product of—

14 ‘‘(i) the projected number of other

15 veterans who will receive care and services

16 under the provisions of chapters 17 and 18

17 of this title at no charge to the individual

18 or to a provider other than the Depart19 ment; and

20 ‘‘(ii) the capitated enrollment amount

21 for such categories of veterans; plus

22 ‘‘(D) the product of—

23 ‘‘(i) the projected number of veterans’

24 dependents who qualify for care under sec25 tion 1803 of this title; and
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1 ‘‘(ii) the capitated enrollment amount

2 for such category of veterans’ dependents.

3 ‘‘(2) In setting the capitated enrollment

4 amounts described in paragraph (1), the Secretary

5 shall deduct any amount collected for such care from

6 any party, including amounts recovered from other

7 agencies of the Federal Government.

8 ‘‘(3) The Secretary shall adjust future certifi9 cations under this subsection to take account of dif10 ferences between actual and projected numbers of

11 qualified veterans and veterans’ dependents.

12 ‘‘(c) The initial capitated enrollment amounts de13 scribed in subsection (b) shall be determined by the Sec14 retary using the most recent cost data available as of the

15 time of the determination, adjusted for inflation to the

16 date of the determination based upon the medical care

17 consumer price index calculated by the Bureau of Labor

18 statistics, and taking into account—

19 ‘‘(1) the annual, fully-allocated cost incurred

20 under prior law in providing care and services at no

21 charge to veterans and veterans’ dependents;

22 ‘‘(2) an estimate of the annual, fully-allocated

23 cost to provide the care and services required by this

24 chapter to be furnished at no charge to veterans and
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1 veterans’ dependents, including an estimate of pro2 jected utilization; and

3 ‘‘(3) an estimate of the annual, fully-allocated

4 cost to provide a premium discount to veterans who

5 qualify as entitled under section 1805(a)(1) of this

6 title and who choose under section 1806(b)(2)(B) of

7 this title to purchase the comprehensive benefits

8 package established in section 1808 of this title, in9 cluding an estimate of projected utilization.

10 ‘‘(d) For each fiscal year after the initial capitated

11 enrollment amounts are established, the capitated enroll12 ment amounts described in subsection (b) shall be deter13 mined by the Secretary using the most recent cost data

14 available as of the time of the determination, adjusted for

15 inflation to the date of the determination based upon the

16 medical care consumer price index calculated by the Bu17 reau of Labor statistics, and taking into account—

18 ‘‘(1) the annual, fully-allocated cost to provide

19 the care and services required by (this chapter) to

20 be furnished at no charge to veterans and veterans’

21 dependents, including an estimate of projected utili22 zation; and

23 ‘‘(2) for purposes of calculating the capitated

24 enrollment amount in subsection (b)(1)(B), the an25 nual, fully-allocated cost to provide a premium dis-
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1 count under the terms set forth in section 1806(f)

2 of this title to veterans who qualify as entitled under

3 section 1805(a)(1) of this title and who choose

4 under section 1806(b)(2)(B) of this title to purchase

5 the comprehensive benefits package established in

6 section 1808 of this title, including an estimate of

7 projected utilization.

8 ‘‘(e) The Secretary shall include in the calculation of

9 the capitated annual enrollment amounts the cost of carry10 ing out the prosthetic and other medical research func11 tions of the Department.

12 ‘‘§ 1817. Resource allocation

13 ‘‘(a) The Secretary shall allocate at least 75 percent

14 of amounts deposited in the Veterans Health Plan Fund

15 to the Veterans Health Plan or Department facility that

16 provided the care or services for which payment was made.

17 In carrying out this subsection, the Secretary is authorized

18 to create regional revolving health plan funds for each Vet19 erans Health Plan or Department facility.

20 ‘‘(b) The Secretary shall establish procedures for uti21 lizing not more than 25 percent of the amounts deposited

22 in the Veterans Health Plan Fund to operate and main23 tain the veterans health system and to ensure that Depart24 ment resources and health care services are allocated in
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1 a reasonable, efficient, and equitable manner throughout

2 the United States.

3 ‘‘(c) A Veterans Health Plan may retain 100 percent

4 of the proceeds of any contract with non-Department enti5 ties for the use of or access to Department health care

6 facilities, equipment, or personnel under a medical re7 source-sharing agreement. This subsection does not apply

8 to contracts for services rendered to veterans under the

9 provisions of this chapter.

10 ‘‘SUBCHAPTER VI—DELIVERY OF HEALTH

11 CARE SERVICES

12 ‘‘§ 1818. Responsibilities of the Secretary of Veterans

13 Affairs

14 ‘‘(a)(1) The Secretary shall administer the veterans

15 health system through use of the model of medical practice

16 known as ‘managed care’. In implementing a managed

17 care system, the Secretary shall, to the extent possible—

18 ‘‘(A) shift the focus of health care provided by

19 the veterans health system to primary care;

20 ‘‘(B) established enhanced quality assurance

21 mechanisms; and

22 ‘‘(C) establish utilization review procedures to

23 prevent inefficient practices.

24 ‘‘(2) The Secretary shall organize veterans hospitals

25 and other veterans health care facilities and services into
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1 Veterans Health Plans. Each Veterans Health Plan may

2 cross State lines and more than one Veterans Health Plan

3 may exist within a State. The Secretary shall establish

4 procedures to ensure portability of coverage throughout

5 the veterans health system.

6 ‘‘(3) The Secretary shall establish standards for the

7 operation of Veterans Health Plans. Such standards

8 shall—

9 ‘‘(A) require the directors of Veterans Health

10 Plans to provide to veterans access to the full range

11 of basic, comprehensive, and supplemental health

12 care services set forth in sections 1807, 1808, and

13 1809 of this title under the terms and conditions es14 tablished in this chapter; and

15 ‘‘(B) require the directors of Veterans Health

16 Plans to establish quality control procedures, includ17 ing—

18 ‘‘(i) the establishment of procedures to as19 sure that the care and services provided to en20 rollees shall be rendered under reasonable

21 standards of quality of care, consistent with

22 prevailing professionally recognized standards

23 of medical practice;

24 ‘‘(ii) the establishment of an ongoing inter25 nal quality assurance program to monitor and
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1 evaluate health care services, including primary

2 and specialist physician services, and ancillary

3 and preventive health care services across all in4 stitutional and non-institutional settings; such

5 program shall include, at a minimum, a written

6 statement of goals and objectives that empha7 size improved health status in evaluating the

8 quality of care rendered to enrollees, a written

9 quality assurance plan describing the structure

10 and process of quality assurance activities, con11 fidentiality policies and procedures, a system of

12 evaluation activities, a system for credentialing

13 providers and performing peer review activities,

14 and a statement of the duties and responsibil15 ities of physicians responsible for quality assur16 ance activities;

17 ‘‘(iii) the establishment of procedures for

18 recording the proceedings of formal quality as19 surance program activities and maintaining

20 documentation in a confidential manner; and

21 ‘‘(iv) the use and maintenance of an ade22 quate patient record system that will facilitate

23 documentation and retrieval of clinical informa24 tion for evaluating continuity and coordination
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1 of patient care and assessing the quality of

2 health and medical care provided to enrollees.

3 ‘‘(4) The Secretary shall ensure that the payment

4 schedules established under this chapter, including sched5 ules for premiums, copayments, deductibles, and coinsur6 ance, are uniform throughout the veterans health system,

7 except that differences among payment schedules shall be

8 permitted at the Secretary’s discretion based upon (1) the

9 type of benefits package, whether basic, comprehensive, or

10 supplemental, as established in sections 1807, 1808, and

11 1809 of this title; (2) the status of the veteran or veteran’s

12 dependent receiving the care and services provided under

13 this chapter; and (3) the type of coverage, whether individ14 ual or family.

15 ‘‘(5) The Secretary may not wholly merge a Veterans

16 Health Plan with any non-Department health care pro17 vider, network, plan; or system.

18 ‘‘(b) In order to carry out the provisions of the chap19 ter and notwithstanding any other provision of law, the

20 Secretary may—

21 ‘‘(1) plan and implement administrative reorga22 nization, consolidation, elimination or redistribution

23 of offices, facilities, functions, or activities of the De24 partment, including the veterans health system and

25 Department facilities—
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1 ‘‘(A) without regard to section 501 of this

2 title; and

3 ‘‘(B) upon a determination by the Sec4 retary that such reorganization, consolidation,

5 elimination, or redistribution is cost-effective, is

6 in the best interests of veterans served by the

7 veterans health system, and is necessary for the

8 provision of care and services under this chap9 ter in a timely and efficient manner; and

10 ‘‘(2)(A) without regard to laws or regulations

11 pertaining to competitive procedures or personnel

12 preferences or priorities, establish alternative person13 nel systems or procedures for personnel at facilities

14 operating as or with a Veterans Health Plan; and

15 ‘‘(B) without regard to section 8110(c) of this

16 title, enter into agreements for direct patient care

17 services, such as nursing or other services, regard18 less of whether such services were previously per19 formed by Federal employees.

20 ‘‘(c)(1) Notwithstanding any law or regulation per21 taining to competitive procedures, acquisition procedures

22 or policies, source preferences or priorities, or bid protests,

23 the Secretary shall have the authority to enter into agree24 ments with non-Department health care plans, insurers,

25 health care providers, health care professionals, health
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1 care facilities, medical equipment suppliers, and related

2 entities, to furnish or obtain the health care and medical

3 resources needed to ensure that the full range of basic,

4 comprehensive, and supplemental benefits set forth in sec5 tions 1807, 1808, and 1809 of this title is available in

6 each Veterans Health Plan.

7 ‘‘(2) The Secretary shall establish procedures and

8 guidance for Veterans Health Plans regarding such agree9 ments, including procedures and guidance for determining

10 and periodically adjusting the amount paid to each pro11 vider of services with respect to the services provided by

12 it.

13 ‘‘(3) The Secretary shall maintain full legal and ethi14 cal responsibility for treatment outcomes and quality of

15 contracted care.

16 ‘‘(d) The Secretary and the directors of the Veterans

17 Health Plans may contract with outside employers to pro18 vide health care services to employees who are otherwise

19 eligible for care and services under this chapter in accord20 ance with the terms and conditions set forth in this chap21 ter. In carrying out this subsection, the secretary shall es22 tablish procedures to ensure that employers make pay23 ments to Veterans Health Plans on behalf of eligible vet24 eran employees in the same manner as such employers
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1 make payments to other health care providers and insur2 ers on behalf of other employees.

3 ‘‘(e)(1) The Secretary shall assist Veterans Health

4 Plans in establishing billing offices and related adminis5 trative resources necessary to collect payment from enroll6 ees, third-party payers, including federally-administered

7 health programs, individuals obtaining fee-for-service care

8 in a Veterans Health Plan, and others.

9 ‘‘(2) In order to provide for the administration of

10 benefits under this chapter with maximum efficiency and

11 convenience for individuals receiving benefits under this

12 chapter and for providers of services, the Secretary may

13 enter into agreements for the provision of administrative

14 services to Veterans Health Plan. Such administrative

15 services may include (A) determination of the rates and

16 payments to be made to providers of services and other

17 persons; (B) receipt, disbursement, and accounting for

18 funds in making such payments; and (C) conducting such

19 audits of the records of providers of services as may be

20 necessary to assure that proper payments are made.

21 ‘‘(f) The Secretary shall establish criteria and appli22 cation procedures for qualification of veterans as entitled

23 under section 1805(a)(8) of this title. The Secretary shall

24 consider the relationship of the cost of the catastrophic

25 illness or injury to the veteran’s income. A veteran whose
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1 annual income, after payment for the catastrophic illness

2 or injury, is, or would be, at or below the applicable levels

3 specified for provision of care at no cost to veterans under

4 chapter 17 of this title, shall be qualified as entitled under

5 this subsection. The Secretary shall establish guidelines

6 for evaluating on an annual basis the continuing need for

7 an individual’s entitled status under this subsection. The

8 Secretary may use the authority provided under section

9 6103 of the Internal Revenue Code to verify the income

10 of any veteran making an application under this sub11 section.

12 ‘‘(g) The Secretary may carry out promotional, adver13 tising, and marketing activities to inform veterans, veter14 ans’ dependents, and others of the care and services avail15 able in Veterans Health Plans and facilities of the Depart16 ment operating as or within the veterans health system.

17 ‘‘(h) The Secretary may delegate to a director of a

18 Veterans Health Plan the authority provided to the Sec19 retary under subsections (c), (d), (e), and (g).

20 ‘‘§ 1819. Responsibilities of Veterans Health Plans

21 and Veterans Health Plan Directors

22 ‘‘(a) Veterans Health Plan directors must enroll all

23 veterans and veterans’ dependents in accordance with the

24 provisions of this chapter—
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1 ‘‘(1) without engaging in practices that have

2 the effect of attracting or limiting enrollees on the

3 basis of personal characteristics such as preexisting

4 health conditions, health status, anticipated needs

5 for health care, age, occupation, race, national ori6 gin, sex, language, socioeconomic status, or disabil7 ity;

8 ‘‘(2) without imposing waiting periods before

9 coverage begins;

10 ‘‘(3) without denying or delaying coverage

11 based upon pre-existing conditions.

12 ‘‘(b) For the purpose of carrying out the provisions

13 of this chapter, Veterans Health Plan directors may, sub14 ject to procedures established by the Secretary and with15 out regard to laws or regulations pertaining to competitive

16 procedures, acquisition procedures or policies, source pref17 erences or priorities, or bid protests—

18 ‘‘(1) enter into agreements with health care

19 plans, insurers, health care providers, health care fa20 cilities, and medical equipment suppliers to furnish

21 or obtain any health care or medical resource; and

22 ‘‘(2) enter into contracts for the procurement of

23 any item commercially available at a cost of less

24 than $300,000.
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1 ‘‘(c) Whenever necessary to carry out the provisions

2 of this chapter, Veterans Health Plan directors may—

3 ‘‘(1) without regard to laws or regulations per4 taining to competitive procedures or personnel pref5 erences or priorities, establish alternative personnel

6 systems or procedures for personnel at facilities op7 erating as or with a Veterans Health Plan; and

8 ‘‘(2) without regard to section 8110(c) of this

9 title, enter into contracts for direct patient care

10 services, such as nursing or other services, regard11 less of whether such services were previously per12 formed by Federal employees.

13 ‘‘SUBCHAPTER VII—STATE HEALTH CARE

14 SYSTEMS

15 ‘‘§ 1820. State health care reform

16 ‘‘A Veterans Health Plan shall be considered a quali17 fied provider or carrier under any State health care reform

18 plan, law, or regulation.

19 ‘‘§ 1821. Applicability of State law

20 ‘‘(a) The provisions of this chapter and the provisions

21 of any contract entered into under this chapter, relating

22 to the nature or extent of coverage or benefits, including

23 payments with respect to benefits, shall supersede and

24 preempt any State law or local law, or any regulation is25 sued thereunder, that relates to health insurance or health
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1 plans to the extent that such law or regulations is incon2 sistent with such provisions of this chapter.

3 ‘‘(b) The Secretary may require Veterans Health

4 Plans to follow any State or local law or regulation as de5 scribed in subsection (a) upon a finding that application

6 of such law or regulation is in the best interests of individ7 uals enrolled in the Veterans Health Plan, or will assist

8 the Veterans Health Plan in achieving or maintaining a

9 competitive position within the State or locality.

10 ‘‘SUBCHAPTER VIII—GENERAL PROVISIONS

11 ‘‘§ 1822. Budget reporting requirements

12 ‘‘The Secretary shall submit to Congress within one

13 year of the effective date of this chapter and annually

14 thereafter, a report on—

15 ‘‘(1) total expenditures under this chapter;

16 ‘‘(2) the fully-allocated cost to the Government

17 to provide care and services at no charge to entitled

18 veterans;

19 ‘‘(3) the fully-allocated cost to the Government

20 to provide care and services at no charge to eligible

21 veterans;

22 ‘‘(4) the fully-allocated cost to the Government

23 to provide care and services at no charge to veter24 ans’ dependents;

25 ‘‘(5) the amount of—
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1 ‘‘(A) premiums, cost-sharing payments and

2 other payments received from individuals pro3 vided services under this chapter;

4 ‘‘(B) payments from federally-administered

5 health programs and other Federal agencies or

6 departments;

7 ‘‘(C) payments from third-party insurance

8 plans;

9 ‘‘(D) payments from medical resource10 sharing arrangements; and

11 ‘‘(E) any other payments made to the De12 partment for services rendered under Veterans

13 Health Plans and the veterans health system.

14 ‘‘§ 1823. General Definitions

15 ‘‘For the purposes of chapters 17 and 18 of this

16 title—

17 ‘‘(1) The term fully-allocated cost means that

18 level of expenses which represents the sum of vari19 able costs incurred in providing health care services

20 plus an appropriate allocation of fixed expenses in21 curred in administering and maintaining the veter22 ans health system.

23 ‘‘(2) The term medical resource sharing agree24 ment means medical resources (whether equipment,

25 space, or personnel) which, because of cost, limited
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1 availability, or unusual nature, are either unique in

2 the medical community or are subject to maximum

3 utilization only through mutual use.

4 ‘‘(3) The term Veterans Health Plan means a

5 plan that provides the health care benefits contained

6 in the basic, comprehensive, and supplemental bene7 fits packages established in sections 1807, 1808, and

8 1809 of this title, respectively, subject to the terms

9 and conditions set forth in chapters 17 and 18 of

10 this title.

11 ‘‘(4) The term veterans health system includes

12 all medical and health care facilities, personnel, and

13 operations under the jurisdiction of the Secretary or

14 under contract with the Department to provide med15 ical and health care services to veterans and veter16 ans dependents under the provisions of chapters 17

17 and 18 of this title.’’.

18 SEC. 5. TECHNICAL AND CONFORMING AMENDMENTS TO

19 CHAPTER 17 OF TITLE 38, UNITED STATES

20 CODE.

21 (a) DEPENDENTS RECEIVING MEDICAL SERVICES.—

22 Section 1701 of title 38, United Stats Code, is amended

23 in subsection (6)(B)—

24 (1) by striking, in the last sentence, ‘‘the last

25 section of’’; and
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1 (2) by striking, in the last sentence, ‘‘(b)’’ after

2 ‘‘1713’’.

3 (b) EXTENSION OF CONTRACTING AUTHORITY.—

4 Section 1703 of title 38, United States Code, is amend5 ed—

6 (1) in subsection (a)—

7 (A) by striking ‘‘When Department facili8 ties are not capable of furnishing economical

9 hospital care or medical services because of geo10 graphical inaccessibility or are not capable of

11 furnishing the care or services required,’’ and

12 beginning the sentence with ‘‘The Secretary’’;

13 (B) by striking ‘‘following’’ and inserting

14 ‘‘health care services provided under chapters

15 17 and 18 of this title’’; and

16 (C) by striking paragraphs (1) through

17 (8);

18 (2) in subsection (b)—

19 (A) by striking ‘‘In the case of any veteran

20 for whom’’ and inserting ‘‘Where’’; and

21 (B) by striking ‘‘a provision of’’; and

22 (3) in subsection (c), by striking ‘‘this section,

23 sections 1712A, 1720, 1720A, and 1732’’ and in24 serting ‘‘chapters 17 and 18’’.
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1 (c) DELETION OF CONFLICTING HOSPITAL CARE,

2 DENTAL CARE AND REIMBURSEMENT PROVISIONS.—Sec3 tion 1710 of title 38, United States Code, is amended—

4 (1) by striking, in the catchline, ‘‘hospital,’’ and

5 the comma after ‘‘nursing home’’;

6 (2) in subsection (a)(1), by striking ‘‘shall fur7 nish hospital care, and’’;

8 (3) in subsection (a)(2), by striking ‘‘hospital

9 care and’’;

10 (4) in subsection (a)(3)—

11 (A) by striking ‘‘hospital care and’’; and

12 (B) by striking ‘‘may furnish such hospital

13 care in accordance with section 1703 of this

14 title and’’;

15 (5) in subsection (c)—

16 (A) by striking, in the first sentence, ‘‘hos17 pital care or’’, ‘‘facilities’’, and ‘‘in addition to

18 treatment incident to the disability for which

19 such veteran is hospitalized,’’;

20 (B) by striking ‘‘The Secretary may fur21 nish dental services’’ and all that follows:

22 (6) in the last sentence of subsection

23 (e)(1)(A)(ii), by striking ‘‘hospital care and’’;

24 (7) in subsection (e)(1)(B), by striking ‘‘hos25 pital care and’’;
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1 (8) in subsection (e)(1)(C), by striking ‘‘hos2 pital care and’’;

3 (9) in subsection (e)(2), by striking ‘‘Hospital

4 and’’;

5 (10) in subsection (e)(3)—

6 (A) by striking ‘‘Hospital and’’; and

7 (B) by striking ‘‘and medical services’’;

8 (11) in subsection (f)(1), by striking ‘‘hospital

9 care or’’;

10 (12) in the first sentence of subsection (f)(2),

11 by striking ‘‘hospital care or’’;

12 (13) in subsection (f)(2)(A)(i), by inserting

13 ‘‘under chapters 17 and 18’’ before the semicolon;

14 (14) in subsection (f)(2)(B), by striking ‘‘$10

15 for every day the veteran receives hospital care

16 and’’;

17 (15) by striking all of subsection (f)(3)(A) and

18 redesignating subparagraph (B) as subparagraph

19 (A);

20 (16) in subsection (f)(3)(C), by redesignating

21 subsection (C) and (B);

22 (17) in subsection (f)(3)(B)(i) (as redesignated

23 by paragraph (16) of this section)—

24 (A) by striking ‘‘inpatient Medicare’’; and
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1 (B) by striking ‘‘this subsection and’’ and

2 inserting ‘‘section 1811(a) or section 1812(f) of

3 this title, or’’;

4 (18) in subsection (f)(3)(B)(ii) (as redesignated

5 by paragraph (16) of this section)—

6 (A) by striking ‘‘subparagraph (A)(ii) of

7 this paragraph’’ and inserting ‘‘section 1811(a)

8 or section 1812(f) of this title’’; and

9 (B) by striking ‘‘inpatient Medicare’’ and

10 inserting ‘‘required’’;

11 (19) in subsection (f)(3)(D)—

12 (A) by redesignating subparagraph (D) as

13 subparagraph (C);

14 (B) by striking, in the first sentence, ‘‘this

15 section’’ and inserting ‘‘chapter 18 of this

16 title’’;

17 (20) in subsection (f)(3)(E)—

18 (A) by redesignating subparagraph (E) as

19 subparagraph (D);

20 (B) by inserting ‘‘section 1811(a) or sec21 tion 1812(f) for hospital care furnished under

22 chapter 18 or under’’ before ‘‘this subsection

23 for’’;
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1 (C) by striking ‘‘hospital care or’’ before

2 ‘‘nursing home care furnished under this sec3 tion’’;

4 (D) by striking ‘‘under section 1712(a) of

5 this title’’;

6 (E) by striking ‘‘this subsection’’ after

7 ‘‘total amount paid by the veteran under’’ and

8 inserting ‘‘section 1811(a) or section 1812(f) of

9 this title’’;

10 (F) by inserting ‘‘under this subsection

11 for’’ before ‘‘nursing home care furnished dur12 ing that period’’; and

13 (G) by striking ‘‘under section 1712(f) of

14 this title’’;

15 (21) in subsection (f)(3)(F)—

16 (A) by redesignating subparagraph (F) as

17 subparagraph (E);

18 (B) by inserting ‘‘section 1811(a) or sec19 tion 1812(f) of this title or under’’ before ‘‘this

20 subsection’’; and

21 (C) by striking ‘‘or section 1712(f) of this

22 title’’; and

23 (22) by striking all of subsection (f)(4) and re24 designating paragraph (5) as paragraph (4).
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1 (d) DELETION OF CONFLICTING ELIGIBILITY AND

2 REIMBURSEMENT PROVISIONS; CLARIFICATION OF CER3 TAIN SPECIALIZED MEDICAL SERVICES.—Section 1712 of

4 title 38, United States Code, is amended—

5 (1) by striking, in the catchline, ‘‘outpatient’’

6 and inserting ‘‘certain medical and dental’’ before

7 ‘‘services’’;

8 (2) in subsection (a)(1)—

9 (A) by striking ‘‘Except as provided in

10 subsection (b) of this section,’’ and beginning

11 the sentence with ‘‘The Secretary shall’’;

12 (B) by striking ‘‘on an ambulatory basis

13 such’’ and inserting ‘‘the’’ before ‘‘medical serv14 ices’’; and

15 (C) by inserting ‘‘set forth in subsection

16 (4) of this paragraph,’’ before ‘‘as the Secretary

17 determines’’;

18 (3) in subsection (a)(2)—

19 (A) by striking ‘‘on an ambulatory or out20 patient basis’’; and

21 (B) by inserting ‘‘set forth in subsection

22 (4) of this paragraph,’’ before ‘‘for a purpose

23 described’’;

24 (4) in subsection (a)(3)—
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1 (A) by striking ‘‘on an ambulatory or out2 patient basis’’; and

3 (B) by inserting ‘‘set forth in subsection

4 (4) of this paragraph,’’ before ‘‘which the Sec5 retary determines’’;

6 (5) by striking the first sentence of subsection

7 (a)(4), and inserting the following: ‘‘For purposes of

8 this paragraph, medical services means prosthetic

9 and orthotic services and appliances, including—

10 ‘‘(A) wheelchairs;

11 ‘‘(B) artificial limbs;

12 ‘‘(C) trusses;

13 ‘‘(D) special clothing made necessary by

14 the wearing of prosthetic or orthotic appliances;

15 and

16 ‘‘(E) such similar appliances and related

17 supplies or services as the Secretary determines

18 to be reasonable and necessary.’’;

19 (6) by striking subsections (a)(5)(A) and

20 (a)(5)(B); and redesignating subsections (a)(6) and

21 (a)(7) as (a)(5) and (a)(6), respectively; and

22 (7) by striking subsections (f) and (i).

23 (e) EXTENSION OF CONTRACTING AUTHORITY; CON24 FORMANCE OF ELIGIBILITY AND NOTIFICATION REQUIRE25 MENTS; ELIMINATION OF LIMITATIONS ON FACILITY RE-
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1 ORGANIZATION AND CLOSURE.—Section 1712A of title

2 38, United States Code, is amended—

3 (1) in subsection (a)(1), by striking ‘‘, within

4 the limits of Department facilities,’’;

5 (2) in subsection (b)(1)—

6 (A) by striking, in the first sentence, ‘‘,

7 within the limits of Department facilities,’’;

8 (B) by striking, in the first sentence, ‘‘on

9 an outpatient basis under the conditions speci10 fied in section 1712(a)(5)(B)’’ and inserting ‘‘in

11 accordance with the criteria established in chap12 ter 18’’;

13 (C) by striking, in the second sentence,

14 ‘‘For the purposes of furnishing such mental

15 health services, the counseling’’ and inserting

16 ‘‘Any hospital care and other medical services

17 considered necessary on the basis of the assess18 ment’’;

19 (D) by striking, in the second and third

20 sentences, ‘‘considered to have been furnished

21 by the Department as a part of hospital care.

22 Any hospital care and other medical services

23 considered necessary on the basis of the assess24 ment furnished under subsection (a) of this sec25 tion shall be’’;
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1 (E) by striking ‘‘this chapter’’ and insert2 ing ‘‘chapter 18’’ after ‘‘eligibility criteria oth3 erwise set forth in; and

4 (F) by striking ‘‘(including the eligibility

5 criteria set forth in section 1711(b) of this

6 title)’’.

7 (3) in subsection (c)(1), by striking ‘‘and’’ at

8 the end of the paragraph;

9 (4) in subsection (c)(2), by striking ‘‘and’’ at

10 the end of the paragraph;

11 (5) by inserting after subsection (c)(2) the fol12 lowing paragraph:

13 ‘‘(3) advise such individual of such individual’s

14 eligibility to obtain services pursuant to the provi15 sions of chapter 18.’’;

16 (6) in subsection (e)(1)—

17 (A) by inserting ‘‘otherwise’’ before ‘‘avail18 able to the Secretary’’; and

19 (B) by striking ‘‘(under sections

20 1712(a)(1)(B) and 1703(a)(2) of this title) in

21 furnishing medical services to veterans suffering

22 from total service-connected disabilities’’ and in23 serting ‘‘under chapters 17 and 18’’;

24 (7) by striking subsection (e)(3);

25 (8) in subsection (g)—
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1 (A) by striking paragraph (1) and redesig2 nating paragraph (2) as paragraph (1); and

3 (B) in paragraph (1)(B)(i)(II) (as redesig4 nated by this paragraph), by striking ‘‘and’’ at

5 the end of the paragraph;

6 (C) in paragraph (1)(B)(ii) (as redesig7 nated by this paragraph), by striking the period

8 at the end of the paragraph and inserting ‘‘;

9 and;

10 (D) in paragraph (1)(B) (as redesignated

11 by this paragraph), by inserting a new para12 graph (1)(B)(iii) as follows:

13 ‘‘(iii) a national plan for ensuring the

14 continued availability and effective furnish15 ing of readjustment counseling services to

16 eligible veterans needing such services.’’;

17 (E) by striking paragraphs (3)(A) and

18 (3)(B);

19 (F) by redesignating paragraph (3)(c) as

20 paragraph (2);

21 (G) in paragraph (2) (as redesignated by

22 this paragraph)—

23 (i) by striking ‘‘(B) after ‘‘‘subpara24 graph’’ and inserting ‘‘(iii)’’;
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1 (ii) by striking ‘‘center’’ and inserting

2 ‘‘region’’; and

3 (iii) by redesignating clause ‘‘(i)’’ as

4 paragraph ‘‘(2)(A)’’;

5 (H) in paragraph (2)(A) (as redesignated

6 by this paragraph)—

7 (i) by striking ‘‘area served by the

8 center’’ and inserting ‘‘region’’;

9 (ii) by striking ‘‘relationships’’ and in10 serting ‘‘relationship’’;

11 (iii) by striking ‘‘such center and the

12 general Department facility’’ and inserting

13 ‘‘Department and contract facilities’’;

14 (iv) by striking clause (ii); and

15 (v) by redesignating clause (iii) as

16 paragraph (2)(B);

17 (I) in paragraph (2)(B) (as redesignated

18 by this paragraph)—

19 (i) by striking ‘‘area served by the

20 center’’ and inserting ‘‘region’’; and

21 (ii) by redesignating clause (iv) as

22 paragraph (2)(C);

23 (J) in paragraph (2)(C) (as redesignated

24 by this paragraph)—

25 (i) by striking ‘‘, the center and’’; and
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1 (ii) by striking clauses (v), (vi), (vii),

2 and (viii);

3 (K) by inserting paragraph (2)(D) as fol4 lows:

5 ‘‘(D) Such other factors as the Secretary

6 determines to be relevant to the evaluation de7 scribed in subparagraph (B) of this para8 graph.’’; and

9 (L) by deleting paragraphs (4) and (5);

10 and

11 (9) by deleting subsection (i).

12 (f) USE OF CONTRACT PROVIDERS.—Section 1712B

13 of title 38, Untied States Code, is amended by striking

14 ‘‘facilities’’ and inserting ‘‘resources’’.

15 (g) CONFORMANCE OF BENEFITS FOR CERTAIN VET16 ERANS’ DEPENDENTS.—Section 1713 of title 38, United

17 States Code, is amended—

18 (1) in subsection (a), by striking ‘‘subsection

19 (b) of this section’’ and inserting ‘‘chapter 18’’ after

20 ‘‘the provisions of’’; and

21 (2) by striking subsection (b).

22 (h) CONFORMANCE OF HOSPITAL CARE BY OTHER

23 FEDERAL AGENCIES WITH CHAPTER 18.—Section 1716

24 of title 38, United States Code, is amended by striking
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1 ‘‘this chapter’’ and inserting ‘‘chapters 17 and 18’’ after

2 ‘’entitled to hospitalization from the Department under’’.

3 (i) CONFORMANCE OF ELIGIBILITY REQUIREMENTS

4 FOR HOME HEALTH SERVICES.—Section 1717 of title 38,

5 United States Code, is amended in subsection (a)—

6 (1) in paragraph (1), by striking ‘‘As part of

7 medical services furnished to a veteran under section

8 1712(a) of this title,’’ and beginning the sentence

9 with ‘‘The Secretary may furnish’’;

10 (2) in paragraph (2)(A), by striking ‘‘in the

11 case of medical services furnished under paragraph

12 (1) of section 1712(a)’’ and inserting ‘‘for (i) a vet13 eran for a service connected disability (including a

14 disability that was incurred or aggravated in line of

15 duty and for which the veteran was discharged or re16 leased from the active military, naval, or air service),

17 (ii) a veteran who qualifies as entitled under section

18 1805(a)(1) of this title and has a service-connected

19 disability rated at fifty (50) percent or greater, and

20 (iii) a veteran who qualifies as entitled under section

21 1805(a)(5)’’; and

22 (3) in paragraph (2)(B), by striking ‘‘in the

23 case of medical services furnished under any other

24 provision of section 1712’’ and inserting ‘‘for a vet-
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1 eran who qualifies as eligible under section

2 1805(b)’’.

3 (j) CONFORMANCE OF ELIGIBILITY REQUIREMENTS

4 FOR THERAPEUTIC AND REHABILITATIVE ACTIVITIES.—

5 Section 1718 of title 38, United States Code, is amended

6 by striking subsection (e).

7 (k) CONFORMANCE OF NURSING HOME AND ADULT

8 DAY CARE WITH CHAPTER 18 CRITERIA.—Section 1720

9 of title 38, United States Code, is amended—

10 (1) in subsection (a)(4), by inserting ‘‘or who is

11 furnished hospital or domiciliary care by the Sec12 retary under the provisions of chapter 18,’’ after

13 ‘‘Alaska of Hawaii’’; and

14 (2) in subsection (f)(1)(A)(ii), by striking ‘‘is el15 igible for medical services under section

16 1712(a)(1)(B) of this title’’ and inserting ‘‘qualifies

17 as entitled under section 1805(a)(1) of this title and

18 has a service-connected disability rated at fifty (50)

19 percent or greater’’ after ‘‘a veteran who’’.

20 (l) CONFORMANCE OF ELIGIBILITY AND NOTIFICA21 TION REQUIREMENTS FOR SUBSTANCE ABUSE TREAT22 MENT; ELIMINATION OF CONTRACTING LIMITATIONS.—

23 Section 1720A of title 38, United States Code, is amend24 ed—
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1 (1) in subsection (a)(1), by striking out ‘‘this

2 chapter’’ and inserting ‘‘chapters 17 and 18’’ after

3 ‘‘medical and rehabilitative services under’’;

4 (2) in subsection (c)—

5 (A) in paragraph (1), by striking out

6 ‘‘and’’ at the end of the paragraph;

7 (B) in paragraph (2), by inserting ‘‘; and’’

8 at the end of the paragraph; and

9 (C) by inserting the following new para10 graph (3):

11 ‘‘(3) advise such individual of such individual’s

12 eligibility to obtain services pursuant to the provi13 sions of chapter 18 of this title.’’; and

14 (3) by striking subsections (e) and (g).

15 (m) CONFORMANCE WITH CHAPTER 18 BENEFITS;

16 ELIMINATION OF CONTRACTING LIMITATIONS.—Section

17 1720B of title 38, United States Code, is amended—

18 (1) in subsection (a), by striking ‘‘1710’’ and

19 inserting ‘‘1806’’ after ‘‘to receive care under sec20 tion’’; and

21 (2) in subsection (b)(2), by striking ‘‘in a De22 partment facility’’.

23 (n) ELIMINATION OF CONTRACTING LIMITATIONS;

24 CONFORMANCE WITH CHAPTER 18 BENEFITS.—Section

25 1720D of title 38, United States Code, is amended—
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1 (1) in subsection (a)(1)(3), by inserting a pe2 riod after ‘‘a qualified mental health professional’’

3 and striking out all that follows; and

4 (2) in subsection (b)(2)(C), by inserting ‘‘or

5 chapter 18’’ after ‘‘under this chapter’’.

6 (o) EXTENSION OF RULEMAKING AUTHORITY TO

7 CHAPTER 18.—Section 1721 of title 38, United States

8 Code, is amended by inserting ‘‘or under a Veterans

9 Health Plan as set forth in chapter 18 of this title’’ imme10 diately before the end of the first sentence.

11 (p) CONFORMANCE WITH CHAPTER 18 ELIGIBILITY

12 CRITERIA.—Section 1722 of title 38, United States Code,

13 is amended—

14 (1) in subsection (a), by inserting ‘‘and

15 1805(a)(6)’’ after ‘‘section 1710(a)(1)(I); and

16 (2) in subsection(f)(3)—

17 (A) by striking out ‘‘section 1710(a) or

18 1712(f)’’ and inserting ‘‘chapter 17’’ after

19 ‘‘case or services under’’; and

20 (B) by inserting ‘‘or the year in which the

21 veteran enrolls in a Veterans Health Plan under

22 chapter 18 of this title’’ immediately before the

23 end of the sentence.

24 (q) CONFORMANCE OF COPAYMENT REQUIREMENT;

25 RETENTION OF PROCEEDS BY THE DEPARTMENT OF
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1 VETERANS AFFAIRS.—Section 1722A of title 38, United

2 States Code, is amended—

3 (1) in subsection (a)(1)—

4 (A) by striking, in the first sentence,

5 ‘‘shall’’ and inserting ‘‘may’’;

6 (B) by striking ‘‘$2’’ and inserting ‘‘a co7 payment’’ after ‘‘United States’’; and

8 (C) by striking the second sentence.

9 (2) in subsection (a)(2), by inserting ‘‘fully-allo10 cated’’ before ‘‘cost to the Secretary’’; and

11 (3) in subsection (b), by striking ‘‘Medical-Care

12 Cost Recovery Fund’’ and inserting ‘‘Health Plan

13 Fund established under section 1815 of this title’’.

14 (r) CHAPTER 18 CLOTHING BENEFIT.—Section 1723

15 of title 38, United States Code, is amended by inserting

16 ‘‘or otherwise receiving care under chapters 17 and 18 of

17 this title,’’ after the first comma.

18 (s) EXTENSION OF REIMBURSEMENT FOR PERSONAL

19 LOSS TO CONTRACT FACILITIES.—Section 1726 of title

20 38, United States Code, is amended by inserting the fol21 lowing sentence at the end: ‘‘The Secretary shall include

22 in any contract with a non-Department facility a provision

23 for reimbursement of veterans and their dependents in

24 contracted health care facilities for any loss of personal

25 effects sustained by fire, earthquake, or other natural dis-
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1 aster while such effects were stored in designated locations

2 in such facilities.’’.

3 (t) CONFORMANCE WITH CHAPTER 18 BENEFITS.—

4 Section 1727 of title 38, United States Code, is amend5 ed—

6 (1) by striking out ‘‘this chapter’’ and inserting

7 ‘‘chapters 17 and 18’’ after ‘‘provided for in’’; and

8 (2) by striking out ‘‘in this chapter’’ and insert9 ing ‘‘therein’’ after ‘‘the service requirements con10 tained’’.

11 (u) CLARIFICATION OF VETERAN REIMBURSEMENT

12 POLICY.—Section 1728 of title 38, United States Code,

13 is amended in subsection (a)—

14 (1) by striking ‘‘entitled to hospital care or

15 medical services under this chapter’’ and ‘‘reimburse

16 veterans’’;

17 (2) by striking out ‘‘such’’ after ‘‘reasonable

18 value of’’ and inserting ‘‘hospital’’;

19 (3) by inserting ‘‘medical’’ before ‘‘services (in20 cluding travel’’;

21 (4) by striking ‘‘from sources other than the

22 Department’’ and inserting ‘‘beyond payment other23 wise required under chapters 17 and 18 of this title’’

24 after ‘‘have made payment,’’; and
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1 (5) in paragraph (3), by inserting ’’, con2 tracted,’’ before ‘‘or other Federal facilities’’.

3 (v) EXTENSION OF THIRD-PARTY RECOVERY TO

4 CHAPTER 18 SERVICES; REPLACEMENT OF MEDICAL5 CARE COST RECOVERY FUND WITH VETERANS HEALTH

6 PLAN FUND; RETENTION OF THIRD-PARTY PAYMENTS

7 BY THE DEPARTMENT OF VETERANS AFFAIRS.—Section

8 1729 of title 38, United States Code, is amended—

9 (1) in subsection (a)(1)—

10 (A) by inserting ‘‘or a veteran’s depend11 ent’’ before ‘‘is furnished care’’; and

12 (B) by striking ‘‘this chapter’’ and insert13 ing ‘‘chapters 17 and 18’’ before ‘‘for a non14 service-connected disability’’;

15 (2) in subsection (g)—

16 (A) by striking paragraph (1) and redesig17 nating paragraph (2) as paragraph (1); and

18 (B) in paragraph (1) (as redesignated

19 under this paragraph), by striking ‘‘Fund’’ and

20 inserting ‘‘Department of Veterans Affairs

21 Health Plan Fund established under section

22 1815 of this title’’; and

23 (C) by striking paragraphs (3) and (4).
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1 (w) CONFORMANCE WITH CHAPTER 18 CRITERIA

2 AND BENEFITS.—Section 1741 of title 38, United States

3 Code, is amended—

4 (1) in subsection (a)(2), by striking in the last

5 sentence ‘‘in a Department facility’’ and inserting

6 ‘‘under sections 1710, 1720 and 1809(b) of this

7 title’’; and

8 (2) in subsection (c)—

9 (A) by striking ‘‘and’’ and inserting a

10 comma after ‘‘sections 1710’’; and

11 (B) by inserting ‘‘and 1809(b)’’ after

12 ‘‘1720’’.

13 (x) EXTENSION OF SICKLE CELL ANEMIA SERVICES

14 TO CHAPTER 18.—Section 1751 of title 38, United States

15 Code, is amended by striking ‘‘chapter’’ and inserting

16 ‘‘title’’ after ‘‘under the provisions of this’’.

17 SEC. 6. TECHNICAL AND CONFORMING AMENDMENTS TO

18 TITLE 38, UNITED STATES CODE.

19 (a) CONFORMANCE WITH CHAPTER 18 ELIGIBILITY

20 CRITERIA.—Section 106 of title 38, United States Code,

21 is amended, in subsection (b), by striking ‘‘chapter 17’’

22 and inserting ‘‘chapters 17 and 18’’ after ‘‘for purposes

23 of determining service-connection of a disability under’’.

24 (b) EXTENSION OF RECOVERY EXEMPTION TO CHAP25 TER 18 BENEFITS.—Section 2651 of title 38, United
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1 States Code, is amended, in subsection (c), by inserting

2 ‘‘or 18’’ after ‘‘under the provisions of chapter 17’’.

3 (c) EXTENSION OF CHAPTER 18 BENEFITS TO VET4 ERANS ELIGIBLE FOR TRAINING AND REHABILITATION.—

5 Section 3104 of title 38, United States Code, is amended,

6 in subsection (a)(9), by striking ‘‘chapter 17’’ and insert7 ing ‘‘chapters 17 and 18’’ after ‘‘services described in’’.

8 (d) CONFORMING REFERENCE TO CHAPTER 18 BEN9 EFITS.—Section 3485 of title 38, United States Code, is

10 amended, in subsection (a)(1), by striking ‘‘chapter 17’’

11 and inserting ‘‘chapters 17 and 18’’ after ‘‘(C) the provi12 sion of hospital and domiciliary care and medical treat13 ment under’’.

14 (3) FALSE CLAIMS UNDER CHAPTER 18.—Section

15 3803 of title 38, United States Code, is amended, in sub16 section (c)(2)(C)(viii), by inserting ‘‘18’’ after ‘‘under

17 chapters 11, 13, 15, 17’’ and before ‘‘and 21’’.

18 (f) CONFORMING REFERENCE TO CHAPTER 18.—

19 Section 3903 of title 38, United States Code, is amended

20 in subsection (e)(1) by inserting ‘‘or 18’’ after ‘‘eligible

21 for care under chapter 17’’.

22 (g) RECOVERY OF INTEREST AND OTHER COSTS

23 UNDER CHAPTER 18.—Section 5315 of title 38, United

24 States Code, is amended in subsection (a)(2) by striking
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1 ‘‘chapter 17’’ and inserting ‘‘chapters 17 and 18’’ after

2 ‘‘from the provision of care or services under’’.

3 (h) SUSPENSION OF PENSION REDUCTION FOR VET4 ERANS RECEIVING REHABILITATIVE SERVICES UNDER

5 CHAPTER 18.—Section 5503 of title 38, United States

6 Code, is amended in subsection (a)(1)(D) by inserting ‘‘or

7 18’’ after ‘‘rehabilitation services, under chapter 17’’.

8 (i) EXTENSION OF NON-DISCRIMINATION RULE TO

9 CHAPTER 18.—Section 7333 of title 38, United States

10 Code, is amended by inserting in subsection (a) ‘‘or 18’’

11 after ‘‘under chapter 17’’.

12 (j) EXTENSION OF CONTRACTING AUTHORITY.—Sec13 tion 8102 of title 38, United States Code, is amended by

14 inserting in subsection (a) ‘‘or contract for’’ after ‘‘The

15 Secretary shall provide’’.

16 (k) ELIMINATION OF ACQUISITION RESTRICTIONS.—

17 Section 8103 of title 38, United States Code, is amended

18 by striking in subsection (d)(1) ‘‘of not more than three’’

19 after ‘‘for the acquisition of’’.

20 (l) ELIMINATION OF INEFFICIENT OPERATING RE21 QUIREMENTS.—Section 8110 of title 38, United States

22 Code, is amended—

23 (1) by striking all of subsection (a)(1) and in24 serting the following:
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1 ‘‘(a)(1) The Secretary shall establish the total num2 ber of hospital beds and nursing home beds in medical

3 facilities over which the Secretary has direct jurisdiction

4 for the care and treatment of Veterans Health Plan enroll5 ees. The Secretary shall establish the total number of such

6 beds so as to maintain a contingency capacity to assist

7 the Department of Defense in time of war or national

8 emergency to care for the casualties of such war or na9 tional emergency. The Secretary shall provide, in such a

10 manner as to ensure the immediate acceptance and timely

11 and complete care of patients, for sufficient beds and

12 other treatment capacities to accommodate, and provide

13 care to, Veterans Health Plan enrollees applying for ad14 mission and found to be in need of hospital care or medical

15 services under chapter 17 or 18 of this title.’’;

16 (2) in subsection (a)(2)—

17 (A) by striking ‘‘maintain the’’ and insert18 ing ‘‘provide’’ after ‘‘The Secretary shall’’;

19 (B) by striking ‘‘of all Department medical

20 facilities’’ after ‘‘and treatment capacities’’; and

21 (C) by striking ‘‘section 1712 of’’ after

22 ‘‘furnished pursuant to’’; and

23 (3) by striking paragraph (5).

24 (m) ELIMINATION OF INEFFICIENT OPERATING RE25 STRICTIONS.—Section 8111 of title 38, United States
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1 Code, is amended by striking in subsection (a) from ‘‘re2 sult (1) in a permanent reduction’’ through ‘‘to be oper3 ated and maintained or’’ after ‘‘enter into an agreement

4 that would’’ and before ‘‘in any way subordinate or trans5 fer’’.

6 (n) ELIMINATION OF RESTRICTIONS ON CONTRACT7 ING AUTHORITY; CHAPTER 18 HOSPITAL SERVICES.—

8 Section 8111A of title 38, United States Code, is amend9 ed—

10 (1) in subsection (b)(2)(A), by striking ‘‘at a

11 department facility under subsection (f) of section

12 1712 of this title’’ after ‘‘is receiving medical serv13 ices’’; and

14 (2) in subsection (b)(2)(B)—

15 (A) by striking in clause (i) ‘‘section 1710

16 of’’ after ‘‘hospital care under’’; and

17 (B) by striking in clause (ii) ‘‘such sec18 tion’’ and inserting ‘‘this title’’ after ‘‘for hos19 pital care under’’.

20 (o) ELIMINATION OF RESTRICTIONS ON CONTRACT21 ING AUTHORITY; PAYMENT PROVISIONS FOR CHAPTER 18

22 BENEFITS.—Section 8153 of title 38, United States Code,

23 is amended—

24 (1) by striking subsection (c); and
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1 (2) by inserting in subsection (d) ‘‘or 18’’ after

2 ‘‘not eligible for such care or services under chapter

3 17’’.

4 SEC. 7. EFFECTIVE DATE.

5 The provisions of this Act shall take effect two years

6 after the date of the enactment of this Act.

Æ