In the Senate of the United States,
June 8 (legislative day, June 7), 1994.
Resolved, That the bill from the House of Representa-
tives (H.R. 4013) entitled ‘‘An Act to amend title 38, United
States Code, to provide the Secretary of Veterans Affairs
with necessary flexibility in staffing the Veterans Health Ad-
ministration’’, do pass with the following
AMENDMENT:
Strike out all after the enacting clause and insert:
SECTION 1. SHORT TITLE.
This Act may be cited as the ‘‘VA State Health Care
Reform Pilot Program Act’’.
SEC. 2. PURPOSE OF PILOT PROGRAMS.
The purpose of this Act is to authorize the participa-
tion of the Department of Veterans Affairs health care sys-
tem in the health care systems of States that have enacted
health care reform in order to evaluate the most appropriate
means of enabling the Department health care system to
participate in such systems and in the National health care
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system contemplated under any plans for National health
care reform.
SEC. 3. HEALTH CARE PILOT PROGRAMS.
(a) IN GENERAL.—The Secretary may carry out pilot
programs on the participation of the Department of Veter-
ans Affairs health care system in the health care systems
of States that have adopted comprehensive health benefit
plans. The Secretary shall carry out any pilot program
under this Act in accordance with the provisions of this
Act.
(b) STATES ELIGIBLE FOR DESIGNATION.—(1) The
Secretary shall designate each of not more than five States
as a location for a pilot program under this Act. The Sec-
retary shall complete the designation of States as locations
for pilot programs not later than 30 days after the date
of the enactment of this Act.
(2) The Secretary may designate a State as a location
for a pilot program under this Act if the Secretary deter-
mines that—
(A) the State has enacted, or will soon enact, a
statute establishing or providing for a comprehensive
health benefit plan; and
(B) the participation of the health care system of
the Department under the plan is feasible and appro-
priate in light of the purpose of this Act.
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(c) DEPARTMENT PARTICIPATION IN STATE HEALTH
BENEFIT PLANS—(1) To the maximum extent practicable,
the Secretary shall provide eligible persons under each pilot
program under this Act with the comprehensive package of
basic health care benefits that would otherwise be available
to such persons under the comprehensive health benefit plan
of the State in which the pilot program is carried out. The
Secretary shall provide such benefits through the health care
system of the Department in such State as if such system
were a provider of such benefits under such plan.
(2) Notwithstanding any other provision of law, a
State may not prohibit the participation of the Department
under the comprehensive health benefit plan of the State
under a pilot program unless the chief executive officer of
the State certifies to the Secretary that—
(A) the benefits to be provided by the Depart-
ment under the pilot program do not meet require-
ments for quality of benefits established by or pro-
vided under the plan; or
(B) the location of Department facilities (includ-
ing facilities providing services by contract or agree-
ment with the Secretary) in the State is such that the
proximity of eligible persons to such facilities does not
meet requirements so established for such proximity.
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(3) Not later than 30 days after the designation of a
State as a location for a pilot program under this Act, and
at such other times as the Secretary may determine, the
Secretary and the health system director for that State shall
jointly determine the regulations under the authority of the
Secretary the waiver or modification of which is necessary
in order to facilitate the carrying out of the pilot program.
Upon such determination, the Secretary shall waive or
modify the application of such regulations to the pilot pro-
gram.
(4) The Secretary shall furnish any eligible person liv-
ing in a State in which a pilot program is carried out (in-
cluding any eligible person electing to receive benefits under
the pilot program and any eligible person not electing to
receive benefits under the pilot program) with the health
care benefits for which such person is eligible under chapter
17 of title 38, United States Code, notwithstanding that the
comprehensive package of basic health care benefits provided
under the comprehensive health benefit plan of the State
does not otherwise include such health care benefits. The
Secretary shall furnish any health care benefits under this
paragraph in accordance with the provisions of that chap-
ter.
(d) HEALTH SYSTEM DIRECTOR.—(1) The Secretary
shall designate a health system director for each State in
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which a pilot program is carried out under this Act. To
the maximum extent feasible, the Secretary shall delegate
to the health system directors the responsibilities of the Sec-
retary under this Act.
(2)(A) Subject to subparagraph (B), the Secretary
shall designate an individual as health system director for
a State from among nominees for that position selected by
a panel composed of individuals who are senior manage-
ment personnel of the Department medical centers located
in that State.
(B) An individual selected for nomination to be a
health system director of a State under subparagraph (A)
shall be—
(i) the director or chief of staff of a Department
medical center located in the State in which the pilot
program is carried out; or
(ii) any other individual having experience with
the Department medical system that is equivalent to
the experience with that system of an individual in
a position referred to in clause (i).
(e) ADMINISTRATIVE
REORGANIZATION.—The Sec-
retary may carry out any administrative reorganization of
an office, facility, activity, or function of the health care
system of the Department in a State in which a pilot pro-
gram is carried out that the Secretary and the health system
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(B) promote and advance personnel serving in
such positions in accordance with such standards as
the Secretary may establish.
(2) Not later than 60 days after the designation of a
State as a location for a pilot program under this Act, or
at such other time as the Secretary may determine, the Sec-
retary shall request authority from the Director of the Office
of Management and Budget to permit the Secretary to em-
ploy a number of full time equivalent employees in the
health care system of the Department in that State which
exceeds the number of such employees that would otherwise
be authorized for such employment by the Director.
(3) Notwithstanding any other provision of law, em-
ployees of the Department at facilities of the Department
under a pilot program shall not, during the carrying out
of the pilot program, be subject to any reduction in the
number of full time employees of the Department or as a
result of a reduction in the number of full time employees
of the Federal Government.
(h) ELIGIBLE PERSONS.—(1) A person eligible for
health care benefits under a pilot program is any person
residing in a State in which a pilot program is carried
out as follows:
(A) Any veteran.
(B) Any spouse or child of a veteran.
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(C) Any individual eligible for care under para-
graph (2) or (3) of section 1713(a) of title 38, United
States Code.
(2) Notwithstanding any other provision of law, a
State may not require that any person other than a person
referred to in paragraph (1) be eligible for health care bene-
fits through the Department under a pilot program.
(i) COPAYMENTS AND OTHER CHARGES.—(1) Except
as provided in paragraph (2), the Secretary may collect
from or on behalf of any individual receiving health care
benefits from the Secretary under a pilot program under
this Act a premium, deductible, copayment, or other charge
with respect to the provision of a benefit under the pilot
program. The amount of the premium, deductible,
copayment, or other charge collected with respect to a bene-
fit provided under a pilot program may not exceed the max-
imum amount otherwise permitted for a premium, deduct-
ible, copayment, or other charge with respect to that benefit
under the comprehensive health benefits plan of the State
in which the pilot program is carried out.
(2)(A) Except as provided in subparagraph (B), the
Secretary shall not collect under the pilot programs pre-
miums, deductibles, copayments, and other charges with re-
spect to the benefits provided by the Department to the fol-
lowing:
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(i) Veterans with compensable service-connected
disabilities.
(ii) Veterans whose discharge or release from ac-
tive military, naval, or air service was for a compen-
sable disability that was incurred or aggravated in
the line of duty.
(iii) Veterans who are in receipt of, or who, but
for a suspension pursuant to section 1151 of title 38,
United States Code (or both a suspension and the re-
ceipt of retired pay), would be entitled to disability
compensation, but only to the extent that such veter-
ans’ continuing eligibility for such care is provided
for in the judgment or settlement provided for in such
section.
(iv) Veterans who are former prisoners of war.
(v) Veterans of the Mexican border period or of
World War I.
(vi) Veterans who are unable to defray the ex-
penses of necessary care, as determined in accordance
with section 1722(a) of such title.
(B) The Secretary may collect premiums, deductibles,
copayments, and other charges with respect to benefits pro-
vided under a pilot program to veterans referred to in sub-
paragraph (A) from any third party obligated to provide,
or to pay the expenses of, such benefits to or for such veter-
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ans under the comprehensive health benefits plan of the
State in which the pilot program is carried out.
(j) FUNDING.—(1) There is established in the Treasury
a fund to be known as the Department of Veterans Affairs
Health Care Reform Fund (hereafter referred to in this sub-
section as the ‘‘Fund’’).
(2)(A) Notwithstanding any other provision of law,
amounts shall be deposited in the Fund as follows:
(i) Amounts collected under a pilot program in
accordance with subsection (i).
(ii) Amounts made available to a pilot program
based upon a determination under paragraph (3).
(iii) Amounts transferred to the Fund with re-
spect to a pilot program under paragraph (4).
(iv) Such other amounts as the Secretary and
the health system directors of the pilot programs
jointly determine to be necessary in order to carry out
the pilot programs.
(v) Such other amounts as may be appropriated
to the pilot programs.
(B) Amounts deposited in the Fund pursuant to
clauses (ii) and (iv) shall be derived from amounts appro-
priated to the Department of Veterans Affairs for the Veter-
ans Health Administration for medical care.
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(C) The Secretary shall establish and maintain a sepa-
rate account under the Fund for each pilot program carried
out under this Act. Any deposits and expenditures with re-
spect to a pilot program shall be made to or from the ac-
count established and maintained with respect to that pilot
program.
(3)(A) For each year of the operation of a pilot pro-
gram under this Act, the Secretary shall deposit in the ac-
count of the Fund for the pilot program an amount (as
determined by the Secretary) equal to the amount that
would otherwise be made available to the health care system
of the Department in the State in which the pilot program
is carried out for the payment of the cost of health care
services by such system in that State in that year. The Sec-
retary shall deposit such amount at the beginning of such
year.
(B) The costs referred to in subparagraph (A) shall
not include costs relating to the provision by the Secretary
of the following services:
(i) Services relating to post-traumatic stress dis-
order.
(ii) Services relating to spinal-cord dysfunction.
(iii) Services relating to substance abuse.
(iv) Services relating to the rehabilitation of
blind veterans.
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(v) Services relating to prosthetics.
(4) Funds deposited in the Medical-Care Cost Recovery
Fund established under section 1729(g) of title 38, United
States Code, during any fiscal year in an amount in excess
of the Congressional Budget Office baseline (as of the date
of the enactment of this Act) for deposits in that fund for
that fiscal year shall not be subject to paragraph (4) of sec-
tion 1710(f), 1712(f), or 1729(g) (as the case may be) of
that title, but shall be transferred to the fund established
under this subsection. Such transfer for any fiscal year shall
be made at any time that the total of amounts so received
less amounts estimated to cover the expenses, payments, and
costs described in paragraph (3) of section 1729(g) of that
title is in excess of the applicable Congressional Budget Of-
fice baseline.
(5)(A) Notwithstanding any other provision of law,
amounts in the Fund shall be available for all expenses in-
curred by the Veterans Health Administration in carrying
out the pilot programs. Subject to subparagraph (B), the
health system director for a State in which a pilot program
is carried out shall determine the expenses of the pilot pro-
gram for that State for purposes of this paragraph.
(B)(i) Except as provided in clause (ii), the costs of
carrying out a pilot program under this paragraph shall
include any costs of marketing and advertising under the
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program, costs of legal services provided to such pilot pro-
gram by the General Counsel of the Department of Veterans
Affairs, and costs relating to acquisition (including acquisi-
tion of land), construction, repair, or renovation of facili-
ties.
(ii) Costs under this subparagraph shall not include
any costs relating to a major medical facility project or
a major medical facility lease as such terms are defined
in subparagraphs (A) and (B) of section 8104(a)(3) of title
38, United States Code, respectively.
(C) The period of availability of amounts in an ac-
count established in the Fund for a pilot program shall end
on the last day of the fiscal year in which the pilot program
is carried out.
(k) TERMINATION.—A pilot program carried out under
this Act shall terminate not later than 2 years after the
date of the commencement of provision of benefits under the
pilot program.
SEC. 4. REPORTS ON PILOT PROGRAMS.
(a) COLLECTION OF INFORMATION.—(1) The Secretary
shall collect such information with respect to the provision
of health care benefits under each pilot program as is nec-
essary to permit the Secretary to evaluate the pilot program
in light of the purpose of the pilot program under this Act.
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(2) The information collected by the Secretary under
paragraph (1) shall include aggregated data on the follow-
ing:
(A) The number of persons participating in each
pilot program, including the age, sex, health status,
disability ratings (if any), employment status, and
incomes of such persons.
(B) The nature of benefits sought by such persons
under each pilot program.
(C) The nature and quantity of benefits provided
to such persons under each pilot program.
(D) The cost to the Department of providing
such benefits under each pilot program.
(b) REPORTS.—(1) Not later than 14 months after the
date of the completion of the designation of States as loca-
tions for pilot programs under this Act, the Secretary shall
submit to the Committees on Veterans’ Affairs of the Senate
and House of Representatives a report on the progress of
the Secretary in carrying out the pilot programs. Such re-
port shall include the information referred to in subsection
(a)(2) on the date of the report.
(2) Not later than November 30 of the year of the ter-
mination of the final pilot program under this Act, the Sec-
retary shall submit to the committees referred to in para-
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graph (1) a report on the pilot programs carried out under
this Act. The report shall include the following:
(A) The information referred to in subsection
(a)(2), together with the comments and conclusions of
the Secretary with respect to such information.
(B) An assessment by the Secretary of the utility
of each pilot program for carrying out the purpose of
this Act.
(C) An assessment by the Secretary of appro-
priate means of integrating the health care system of
the Department into the health care systems of States
that have enacted health care reform and into the Na-
tional health care system contemplated under any
plans for National health care reform.
(D) Such other information, assessments, and
conclusions as the Secretary considers appropriate.
(3) Not later than 30 days after the end of any fiscal
year in which a pilot program is carried out under section
3, the Secretary shall submit to the appropriate committees
of Congress a report describing the amounts expended from
the Department of Veterans Affairs Health Care Reform
Fund established under section 3(j)(1) during that fiscal
year for each pilot program so carried out.
SEC. 5. DEFINITIONS.
For the purposes of this Act—
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(1) The terms ‘‘Secretary’’, ‘‘Department’’, ‘‘vet-
eran’’, ‘‘child’’ and ‘‘spouse’’ have the meanings given
such terms in paragraphs (1), (2), (4), and (31) of
section 101 of title 38, United States Code, respec-
tively.
(2) The term ‘‘comprehensive health benefit
plan’’, in the case of a State, means a plan or system
established under the law of the State that—
(A) attempts to ensure the access of resi-
dents of the State to a comprehensive package of
basic health care benefits; and
(B) ensures such access by providing that
such benefits shall be provided directly or by con-
tract by public and private entities.
(3) The term ‘‘comprehensive package of basic
health care benefits’’ means the health care benefits
provided for by a State under the comprehensive
health benefit plan of the State.
(4) The term ‘‘health care system of the Depart-
ment’’, in the case of a State designated as a location
for a pilot program, means the facilities and person-
nel of the Department located in that State that pro-
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vide health care services under chapter 17 of title 38,
United States Code.
Attest:
Secretary.
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