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104th Congress                                                   Report
                        HOUSE OF REPRESENTATIVES

 1st Session                                                    104-275
_______________________________________________________________________


          EXTENSION OF CERTAIN EXPIRING AUTHORITIES OF THE
 
  DEPARTMENT OF VETERANS AFFAIRS RELATING TO DELIVERY OF HEALTH AND 

             MEDICAL SERVICES, AND FOR OTHER PURPOSES

_______________________________________________________________________


October 12, 1995.--Committed to the Committee of the Whole House on the 
              State of the Union and ordered to be printed

                                _______


          Mr. Stump, from the Committee on Veterans' Affairs,

                        submitted the following

                              R E P O R T

                        [To accompany H.R. 2353]

      [Including cost estimate of the Congressional Budget Office]

  The Committee on Veterans' Affairs, to whom was referred the 
bill (H.R. 2353) to amend title 38, United States Code, to 
extend certain expiring authorities of the Department of 
Veterans Affairs relating to delivery of health and medical 
care, and for other purposes, having considered the same, 
reports favorably thereon with amendments and recommends that 
the bill as amended do pass.

  The amendments (stated in terms of the page and line numbers 
of the introduced bill) are as follows:

  Page 7, line 14, insert ``(except as provided in subsection 
(e)),'' after ``medical center''.

  Page 7, after line 15, insert the following:

  (b) Exception for Certain Department of Veterans Affairs 
Medical Centers.--Such section is further amended--
          (1) by redesignating subsection (e) as subsection 
        (f); and
          (2) by inserting after subsection (d) the following 
        new subsection (e):
  ``(e) Special Rule for Display at Department of Veterans 
Affairs Medical Centers.--(1) Upon a determination by the 
director of a Department of Veterans Affairs medical center 
that the daily display of the POW/MIA flag at that medical 
center may be detrimental to the treatment of patients at that 
center, the provisions of subsection (a)(3) shall be 
inapplicable with respect to that medical center.
  ``(2) Whenever the director of a Department of Veterans 
Affairs medical center makes a determination described in 
paragraph (1), that officer shall submit a report on such 
determination, including the basis for the determination, to 
the Under Secretary for Health of the Department of Veterans 
Affairs.''.

  Page 7, line 16, strike out ``(b)'' and insert in lieu 
thereof ``(c)''.

                              Introduction

    On August 4, 1995, the Honorable Tim Hutchinson was joined 
by the Honorable Chet Edwards, Honorable Bob Stump, Chairman of 
the Veterans' Affairs Committee, Honorable G.V. (Sonny) 
Montgomery, Honorable Chris Smith, Honorable Jack Quinn, 
Honorable Michael Doyle, and Honorable Michael Bilirakis in the 
introduction of H.R. 2219 to amend title 38, United States 
Code, to extend certain expiring authorities of the Department 
of Veterans Affairs, and for other purposes.
    The Subcommittee on Hospitals and Health Care met on 
September 7, 1995 and by unanimous voice vote ordered reported 
H.R. 2219, as amended, to the full Committee.
    The provisions of H.R. 2219, as amended, were incorporated 
into a clean bill, which on September 19, 1995, was introduced 
as H.R. 2353 by the Honorable Tim Hutchinson, joined by the 
Honorable Chet Edwards, Honorable Bob Stump, Chairman of the 
Veterans' Affairs Committee, and Honorable G.V. (Sonny) 
Montgomery.
    The full Committee met on September 20, 1995 and by 
unanimous voice vote ordered reported favorably H.R. 2353, as 
amended.

                      Summary of the Reported Bill

    H.R. 2353, as amended, would:
    1. Extend expiring VA authority to:
          a) provide health care on a priority basis for 
        Persian Gulf War veterans until December 31, 1998;
          b) provide contract authority for alcohol and drug 
        abuse care until December 31, 1997;
          c) administer the Nursing Home Care Alternatives 
        Program until December 31, 1997;
          d) administer the Health Scholarships Program until 
        December 31, 1997;
          e) administer the Enhanced-Use Leases of Real 
        Property Program until December 31, 1997;
          f) administer the Community-Based Residential Care 
        for Homeless Chronically Mentally Ill Veterans Program 
        until December 31, 1997;
          g) operate the Demonstration Program of Compensated 
        Work Therapy and Therapeutic Transitional Housing until 
        December 31, 1997; and
          h) administer the Homeless Veterans Pilot Program 
        until December 31, 1998.
    2. Require the Secretary of Veterans Affairs to submit 
reports to Congress on the following:
          a) the advantages and disadvantages of consolidating 
        into one program the Alcohol and Drug Abuse Program, 
        the Community-Based Residential Care for Homeless 
        Chronically Mentally Ill Veterans Program, and the 
        Demonstration Program of Compensated Work Therapy and 
        Therapeutic Transitional Housing; and
          b) the scientific evidence, and assessment of the 
        strength of such evidence, concerning association 
        between military service in the Southwest Asia theater 
        of operation during the Persian Gulf War and any 
        disease that may be associated with such service.
    3. Repeal the authority to make grants to the Veterans 
Memorial Medical Center in the Philippines.
    4. Provide for the daily display of the POW/MIA flag at all 
VA Medical Centers, as long as such display is not detrimental 
to the treatment of patients at that center.
    5. Authorize the VA to contract for utilities at the Audie 
L. Murphy Memorial Hospital in San Antonio, Texas.
    6. Rename the Walla Walla, Washington VA Medical Center the 
Jonathan M. Wainwright Department of Veterans Affairs Medical 
Center.

                       Background and Discussion

    The reported bill serves a number of purposes. It provides 
for a compassionate three-year extension of VA's authority to 
provide hospital and medical care to those veterans whose 
service in the Persian Gulf War may have resulted in illnesses. 
Because the Committee takes seriously the complaints of these 
veterans and the substantial investment of the American 
taxpayers which has been dedicated to research on Persian Gulf 
illnesses, the bill requires the VA to assess and review the 
strength of these research efforts and other scientific 
evidence relating to service in the Southwest Asia theater of 
operations and report to Congress on their findings. The bill 
also extends eight expiring authorities and provides for an 
evaluation on the advisability of consolidating three programs 
which appear to have overlapping program responsibilities. The 
bill repeals the VA's grant authority to the Philippines, 
renames the Walla Walla, Washington VA Medical Center and 
grants authority for VA to contract for a period of 35 years 
for utilities for the Audie L. Murphy VA Medical Center. 
Finally, the bill would require VA medical centers to fly the 
POW/MIA flag daily, unless a determination has been made that 
such a display would be detrimental to the patient's care at 
the center.
Section 1. Extension of Expiring Authorities of Department of Veterans 
        Affairs
    (a) Extension of Hospital Care and Medical Services for 
Persian Gulf Veterans Exposed to Toxic Substances.--Under this 
bill, authorization to provide health care on a priority basis 
for Persian Gulf War veterans would be extended until December 
31, 1998.
    During and since the Persian Gulf War, numbers of returning 
American service personnel have reported conditions they 
attribute to their assignment in the Arabian peninsula and the 
surrounding area. Most of the medical problems have been 
diagnosable, but symptoms of several thousand veterans have not 
been readily explained.
    Extensive research is currently underway to attempt to 
answer the seemingly perplexing questions of illnesses and 
diseases attributable to service in the Persian Gulf. The 
multitude of studies currently being conducted by various 
government agencies are looking into possible physical, 
chemical, biological and psychological factors in an effort to 
produce a satisfactory explanation for these unexplained 
illnesses. This bill would continue Congressional authorization 
for priority treatment for these veterans for a three-year 
period.
    (b) Contract Authority for Alcohol and Drug Abuse Care.--
The extension would allow the program to operate through 
December 31, 1997. Under this authority, the VA is able to 
contract for care, treatment and rehabilitative services in 
halfway houses, therapeutic communities, psychiatric 
residential treatment centers and other community-based 
treatment centers for eligible veterans suffering from alcohol 
or drug dependence and abuse disorders.
    In response to the growing need to provide a residential 
environment to bridge the gap between inpatient treatment and 
independent life in the community for selected substance abuse 
patients, Congress gave VA authority to contract for personal 
care, treatment and rehabilitative services in non-VA halfway 
houses, therapeutic communities, psychiatric residential 
treatment centers and other community-based treatment 
facilities. The program was originally established in 1979 
under Public Law 96-22, section 104 and has subsequently been 
extended under P.L. 99-166, P.L. 100-689, P.L. 102-86, and P.L. 
103-452.
    The program is based on a short-term care model of 
community treatment where the residential facility provides 
temporary housing and support services for substance-abusing 
patients who have completed an intensive rehabilitation 
program. Placement in contract facilities is limited to 60 days 
with a 30-day extension for clinically justified reasons. There 
were 6,309 placements made in FY 1994 at a cost of 
approximately $8.7 million with an average per diem cost of 
$35.
    With continuing efforts to decrease the average length of 
stay for acute inpatient care, this program provides a low-
cost, structured environment for veterans suffering from not 
only substance abuse conditions but also homelessness. 
Evaluative data has shown a reduction in readmission rates to 
inpatient programs. With continuing efforts to decrease acute 
inpatient lengths of stay, programs such as these play an 
increasingly important role in the treatment drug and alcohol 
related conditions.
    (c) Nursing Home Care Alternatives.--In response to 
changing trends in the delivery of health care services, the VA 
under P.L. 101-366 was authorized to conduct ``a pilot program 
to furnish medical rehabilitation and health-related services 
in non-institutional settings.'' Extension of this program 
through December 31, 1997 would permit the VA to continue 
providing homemaker and home health aide services to certain 
eligible veterans.
    A recent June 1995 evaluation concludes that the pilot was 
successful in meeting the stated program goals and enhancing 
the care of veterans in need of nursing home care. Veterans who 
utilized the service, as well as VA hospital staff involved 
with the program's implementation, reported a high degree of 
satisfaction.
    Recent trends in health care have supported a change in 
focus toward the provision of home health services as an 
alternative to long-term institutional care. Surveys have 
demonstrated that people prefer home care to institutional care 
and that those remaining in the home with supportive services 
evidence higher satisfaction and perceived quality of life.
    Specific conclusions of the 1995 evaluation showed that the 
program was widely implemented throughout the VA system. 
Veterans took advantage of the benefit and stated overall a 
high degree of satisfaction with their participation. The 
program provided services to veterans in need and cost of 
services which fell within the mandated budgetary allowance.
    In an effort to determine the future viability and 
direction of this program, a comprehensive evaluation of the 
program is due to Congress no later than March 31, 1997 on the 
comparative cost effectiveness, and advantages and 
disadvantages of non-institutional alternatives to nursing home 
care.
    (d) Health Scholarships Program.--The extension would allow 
the program established in 1982 to continue to operate through 
December 31, 1997. Those eligible to receive scholarships are 
nursing students and those pursuing other health care 
professional studies in fields such as occupational therapy, 
physical therapy, nurse anesthesiology, respiratory therapy and 
physician assistance. The program has served as a means of 
recruitment and retention for many scarce and difficult-to-
recruit health care positions. Since 1982, 4,000 scholarships 
have been awarded, with nearly 3,000 recipients completing 
their education and service obligation to the VA.
    The extension also includes a requirement for comprehensive 
evaluation of the Health Scholarships Program by a private 
contractor which would report its findings to Congress through 
the Secretary of Veterans Affairs by March 31, 1997. The 
purpose of the outside evaluation is to determine the costs and 
benefits of the program's operation in light of the changing 
needs and dynamics of the health professions. In addition, the 
report should evaluate whether the program might meet its 
objectives by providing partial scholarships to a larger number 
of recipients.
    (e) Enhanced-Use Leases of Real Property.--The bill would 
amend section 8169 of title 38, U.S.C. to extend until December 
31, 1997 the Secretary's authority to enter into enhanced-use 
leases. Enhanced-use is based on the concept that outleasing 
underutilized VA property, on a long-term basis, to non-VA 
users for uses compatible with VA programs will enable the VA 
to obtain facilities, services and/or money for VA requirements 
that would otherwise be unavailable or unaffordable.
    Under the bill, the Secretary is required to provide an 
evaluation on the program's operation. The report is due to 
Congress by March 31, 1997.
    (f) Community-Based Residential Care for Homeless 
Chronically Mentally Ill Veterans (HCMI).--The bill would 
extend this program for two years, until December 31, 1997.
    The program was developed in 1987 and has continued as a 
pilot initiative through a series of reauthorizations. The HCMI 
veterans program employs VA outreach and case management 
services and, where appropriate, psychiatric residential 
treatment for eligible homeless mentally ill veterans in 
community-based facilities, arranged and paid for through VA 
contracts. A total of 71 programs have been established in 33 
states and the District of Columbia. In FY 1995, the average 
length of stay for veterans in the program was 71 days and the 
average cost per day was $39.
    (g) Demonstration Program of Compensated Work Therapy and 
Therapeutic Transitional Housing (CWT/TR).--Under the bill, the 
program is extended for two years until December 31, 1997. 
Under section 2 of the bill, VA is to assess the CWT/TR 
Demonstration Program, along with two other programs which 
treat similar veteran patient populations, for possible 
consolidation.
    The program was designed to assist veterans suffering from 
substance abuse problems or severe mental illnesses and 
homelessness to make a successful re-entry into independent 
community living. The program offers veterans structured, 
supervised treatment in community-based residences while they 
work for pay in VA Compensated Work Therapy (CWT) programs (now 
also called Veterans Industries). These veterans use a portion 
of their CWT earnings to cover the cost of maintaining the 
residences and are also responsible for the purchase and 
preparation of their own food.
    The CWT/TR program has been implemented at 23 VA medical 
centers. Forty-six residences have been purchased, and the 
program will have 404 beds when fully operational.
    (h) Homeless Veterans Pilot Program.--This bill would 
extend this program of assisting homeless veterans and veterans 
at risk of homelessness, until December 31, 1998.
    Specifically, the program authorizes the VA to work with 
homeless centers and agencies nationwide to create 
comprehensive homeless centers and place VBA counselors at 
homeless centers. Additionally, it enables the VA to provide 
grants to non-VA entities which assist homeless vets. In FY 
1994, a total of 33 projects were funded at a cost of $5.5 
million. Finally, the program allows the VA to provide per diem 
payments to entities eligible to receive a grant. 
Reauthorization is needed and provided under this legislation 
only for the grant and per diem programs.
Section 2. Reports
    (a) Report on Consolidation of Certain Programs.--Under 
this provision, the Secretary of Veterans Affairs is required 
to submit to Congress no later than March 1, 1997 an evaluative 
report on the advantages and disadvantages of consolidating 
into one program the following: the Alcohol and Drug Abuse 
Contract Care Program, the Community-Based Residential Care to 
Homeless Chronically Mentally Ill Veterans Program, and the 
Homeless Veterans Pilot Program. These three programs serve 
similar populations with overlapping treatment 
responsibilities. An evaluation of the operation and scope of 
services will provide Congress with the necessary data and 
information to ensure the most appropriate structure for the 
continuity and future direction of programs dealing with this 
complex patient population.
    (b) Report on Scientific Evidence Concerning Health 
Consequences of Military Service in Persian Gulf War.--The 
provision specifies that the Secretary of Veterans Affairs will 
submit to Congress no later than March 1, 1998 a report on the 
findings of a review to determine the association between 
military service in the Southwest Asia theater of operations 
during the Persian Gulf War and any diseases that may be 
associated with such service.
Section 3. Repeal of Authority to Make Grants to Veterans Memorial 
        Medical Center in the Philippines
    As of February 28, 1994, the VA suspended admissions to the 
Veterans Memorial Hospital in Manila (VMMC). A VA review team 
concluded that care provided to U.S. at the VMMC did not meet 
reasonable standards of care; consequently, all veteran care at 
VMMC is now handled by the VA Clinic staff in Manila through 
the contract hospital program. With the suspension of U.S. 
veteran admissions to VMMC, the continuing appropriation of 
U.S. funds to maintain and upgrade the physical plant at the 
facility is not appropriate.
Section 4. Display of POW/MIA Flag at Department of Veterans Affairs 
        Medical Centers
    Section 4 of the bill would amend provisions of the 
National Defense Authorization Act for Fiscal Years 1992 and 
1993 to require that the POW/MIA flag be displayed on, or on 
the grounds of, each VA medical center whenever the American 
flag is flown.
    The POW/MIA flag embodies the Nation's commitment to obtain 
the fullest possible accounting of the fate of missing or 
imprisoned American servicemen. Section 4 of the bill would 
further honor that commitment by expanding to VA medical 
centers the sites where that flag is to be displayed.
    The primary mission of such centers, of course, is 
provision of medical care to veterans. In that regard, the 
Committee is cognizant of the important role VA facilities play 
in treating veterans with psychiatric problems, and of the fact 
that the provision of psychiatric care is a key mission at many 
VA facilities. Accordingly, the bill reflects a sensitivity to 
the effect that the VA's daily display of the POW/MIA flag 
might have on its treatment of psychiatric patients, and 
particularly those under treatment for Post-traumatic Stress 
Disorder (PTSD).
    In the professional opinion of the chief of one facility's 
PTSD program, the POW/MIA flag is an emotional symbol which for 
some veterans can trigger powerful reactions--including guilt 
about their own survival--guilt which can aggravate a 
psychiatric problem. That clinician expressed deep concern that 
in many instances his patients' treatment could be compromised 
by being confronted daily by such a symbol. The Committee is 
aware that other clinicians do not see a detrimental effect 
from the flag's display. The Committee does not purport to 
reach a conclusion as to the soundness of either view. Rather, 
it believes this question should be resolved at VA medical 
centers in their primary role as caregivers. Accordingly, 
section 4 provides for an exception, making the display 
requirement inapplicable to any medical facility where the 
facility director determines that daily display of the flag at 
that institution may be detrimental to the treatment of 
patients at that facility.
    The Committee intends such determination to be based 
exclusively on clinical judgment. Such judgment, in the 
Committee's view, must be exercised locally in light of the 
particular treatment programs, patients, and circumstances of 
that facility. The exception in the bill is not intended, 
however, to be invoked on behalf of hypothetical future 
patients, or solely on behalf of an isolated case. To guard 
against exceptions being made lightly, or even arbitrarily, and 
to ensure that the reasons for not displaying the flag are 
based on clinical judgment, the bill requires that the director 
document the basis for any such determination in a report to 
the Under Secretary for Health. The Committee envisions that 
such centralized reporting will facilitate oversight, help 
ensure that the letter and spirit of the requirement is 
honored, and enable corrective action to be taken if necessary.
Section 5. Contract for Utilities, Audie L. Murphy Memorial Hospital
    Under this section, the Audie L. Murphy Memorial VA Medical 
Center will be authorized to contract for the provision of 
utilities to include steam and chilled water for a period not 
to exceed 35 years.
    On August 31, 1993 an energy agreement between the medical 
center and the University of Texas Health Science Center at San 
Antonio expired. To meet its energy needs, Audie Murphy entered 
into discussions with the Bexar County Hospital District which 
owns and operates a hospital adjacent to the VAMC.
    Under current law, the VA is limited through delegation 
from the General Services Administration to a 10-year term on a 
utility contract. Because the 10-year contract limit would 
greatly increase energy costs to Audie Murphy, the VA looked to 
the development of an alternative arrangement. The VA found it 
would be most economical if it could enter into a contract of 
up to 35 years while retaining an equity interest in the 
facility. In addition, the VA will contribute $3 million to the 
cost of constructing the energy plant, contract to buy chilled 
water and steam from the Hospital District, and provide the 
Hospital District the needed commitment to give Audie Murphy 
the lowest possible yearly operating costs. Under this bill, 
the contract will be structured to protect federal investment 
through joint title to the plant.
Section 6. Name of Department of Veterans Affairs Medical Center, Walla 
        Walla, Washington
    This section of the bill would change the name of the Walla 
Walla, Washington VA Medical Center to the Jonathan M. 
Wainwright Department of Veterans Affairs Medical Center.
    In honor of the 50th Anniversary of V-J Day, the entire 
Washington State Delegation, in concert with the citizens of 
Walla Walla, Washington, have requested the redesignation of 
the Walla Walla Department of Veterans Affairs Medical Center 
to the Jonathan M. Wainwright Department of Veterans Affairs 
Medical Center.
    General Wainwright was a hero of World War II, earning the 
Congressional Medal of Honor for his service as commander of 
U.S. Troops in the Philippines after General Douglas MacArthur 
was forced to relocate his command. General Wainwright fought a 
heroic struggle against overwhelming odds, but was ultimately 
forced to surrender the Philippines to the Japanese. As a 
prisoner of war in Japanese-occupied Manchuria for the next 
three years, General Wainwright displayed outstanding courage 
and loyalty which won him the respect and admiration of all 
Americans. He was freed in time to be present with General 
MacArthur aboard the U.S.S. Missouri for the formal surrender 
of Japan.
    General Wainwright was born at Fort Walla Walla, 
Washington. The son of a cavalry officer, he graduated from 
West Point in 1906. He was awarded the Congressional Medal of 
Honor by the President in 1945 and retired from military 
service in 1947. He died on September 2, 1953.

                      Section-By-Section Analysis

    Section 1(a) would amend section 1710(e)(3) of title 38, 
United States Code, and section 1712(a)(1)(D) of title 38, 
United States Code, to extend until December 31, 1998, the 
Secretary's authority to provide health care on a priority 
basis for Persian Gulf War Veterans.
    Section 1(b) would amend section 1720A(e) of title 38, 
United States Code, to extend until December 31, 1997, the 
Secretary's contract authority for alcohol and drug abuse care.
    Section 1(c) would amend section 1720C(a) of title 38, 
United States Code, to extend until December 31, 1997, the 
Secretary's authority to provide nursing home care alternatives 
to certain eligible veterans.
    Section 1(d) would amend section 7618 of title 38, United 
States Code, to extend until December 31, 1997, the Secretary's 
authority to operate the Health Scholarships Program.
    Section 1(e) would amend section 8169 of title 38, United 
States Code, to extend until December 31, 1997, the Secretary's 
authority to enter into enhanced-use leases of real property.
    Section 1(f) would amend section 115(d) of the Veterans' 
Benefits and Services Act of 1988 (38 U.S.C. 1712 note), to 
extend until December 31, 1997, the Secretary's authority to 
operate the Community-Based Residential Care for Homeless 
Chronically Mentally Ill Veterans program.
    Section 1(g) would amend section 7 of Public Law 102-54 (38 
U.S.C. 1718 note), to extend until December 31, 1997, the 
Secretary's authority to operate the Demonstration Program of 
Compensated Work Therapy and Therapeutic Transitional Housing.
    Section 1(h) would amend sections 2(a), 3(a) and 12 of the 
Homeless Veterans Comprehensive Service Programs Act of 1992 
(38 U.S.C. 7721 note), to extend until December 31, 1998, the 
Secretary's authority to operate the Homeless Veterans Pilot 
Program.
    Section 2(a) would require the Secretary to submit to 
Congress no later than March 1, 1997, a report on the 
advantages and disadvantages of consolidating into one program 
the following three programs: the Alcohol and Drug Abuse 
Contract Care Program, the Community-Based Residential Care to 
Homeless Chronically Mentally Ill Veterans Program and the 
Homeless Veterans Pilot Program.
    Section 2(b) would require the Secretary to submit to 
Congress no later than March 1, 1998, a report on scientific 
evidence concerning health consequences of military service in 
the Persian Gulf War.
    Section 3 would strike section 1732(b) of title 38, United 
States Code, to repeal the Secretary's authority to make grants 
to the Veterans Memorial Medical Center in the Philippines.
    Section 4 would amend section 1084(a) of the National 
Defense Authorization Act for Fiscal Years 1992 and 1993 (36 
U.S.C. 189 note), to require the display of the POW/MIA flag at 
Department of Veterans Affairs Medical Centers on each day that 
the American flag is flown.
    Section 5 would authorize the Secretary to enter into 
contracts for utilities at the Audie L. Murphy Memorial 
Hospital.
    Section 6 would change the name of the Walla Walla, 
Washington VA Medical Center to the Jonathan M. Wainwright 
Department of Veterans Affairs Medical Center.

                           Oversight Findings

    No oversight findings have been submitted to the Committee 
by the Committee on Government Reform and Oversight.

               Congressional Budget Office Cost Estimate

    The following letter was received from the Congressional 
Budget Office concerning the cost of the reported bill:

                                     U.S. Congress,
                               Congressional Budget Office,
                                   Washington, DC, October 3, 1995.
Hon. Bob Stump,
Chairman, Committee on Veterans' Affairs,
House of Representatives, Washington, DC.
    Dear Mr. Chairman: The Congressional Budget Office has 
reviewed H.R. 2353, a bill to amend title 38, United States 
Code, to extend certain expiring authorities of the Department 
of Veterans Affairs, and for other purposes, as ordered 
reported by the House Committee on Veterans' Affairs on 
September 20, 1995.
    The bill would not affect direct spending or receipts and 
thus would not be subject to pay-as-you go procedures under 
section 252 of the Balanced Budget and Emergency Deficit 
Control Act of 1985. The bill would not affect the budgets of 
state or local governments.
    If you wish further details on this estimate, we will be 
pleased to provide them.
            Sincerely,
                                           June E. O'Neill,
                                                          Director.
    Enclosure:

                                     

    1. Bill number: H.R. 2353.
    2. Bill title: A bill to amend title 38, United States 
Code, to extend certain expiring authorities of the Department 
of Veterans Affairs relating to delivery of health and medical 
care, and for other purposes.
    3. Bill status: As ordered reported by the House Committee 
on Veterans' Affairs on September 20, 1995.
    4. Bill purpose: This bill would extend certain expiring 
authorities of the Department of Veterans Affairs (VA).
    5. Estimated cost to the federal government:
    The following table summarizes the estimated budgetary 
impact of H.R. 2353, which would depend upon subsequent 
appropriations action.

                                                                                                                
                                    [By fiscal year, in millions of dollars]                                    
----------------------------------------------------------------------------------------------------------------
                                                              1995     1996     1997     1998     1999     2000 
----------------------------------------------------------------------------------------------------------------
                                                                                                                
                                    SPENDING SUBJECT TO APPROPRIATIONS ACTION                                   
Spending Under Current Law................................                                                      
  Budget Authoritya b.....................................      172       25        0        0        0        0
  Estimated Outlays.......................................      178       39        0        0        0        0
Proposed Changes..........................................                                                      
  Estimated Authorization Level...........................        0      136      160      107       21       -1
  Estimated Outlays.......................................        0      117      159      117       34       -1
Spending Under H.R. 2353..................................                                                      
  Estimated Authorization Level...........................      172      160      160      107       21       -1
  Estimated Outlays.......................................      178      156      159      117       34       -1
----------------------------------------------------------------------------------------------------------------
a The 1995 figure is the amount already appropriated for a variety of unrelated programs.                       
b Amounts for fiscal years 1996 through 2000 are authorizations subject to appropriations action.               


    6. Basis of estimate: The estimate assumes enactment of the 
bill by November 1, 1995, and appropriation of the authorized 
amounts for each fiscal year. CBO used historical spending 
rates for estimating outlays. Only those sections having a 
budgetary impact are discussed below.
    Medical Treatment for Persian Gulf Veterans.--Section 1(a) 
would extend from December 31, 1995, to December 31, 1998, VA's 
authority to provide medical treatment to veterans who may have 
been exposed to toxic substances while serving in the Persian 
Gulf War. Since 1992, about 180,000 veterans have sought 
outpatient care for ailments believed to have resulted from 
exposure to toxic substances while serving in the Gulf War. 
Forty-eight thousand Gulf War veterans are on VA's registry, 
and registrations continue at the rate of 2,000-2,500 per month 
during fiscal year 1995.
    Based on estimates from VA, the cost of treating and 
testing these veterans would be $80 million per year through 
1998. The cost for the final nine months of fiscal year 1996 
would be $60 million.

                                                                                                                
                                    [By fiscal year, in millions of dollars]                                    
----------------------------------------------------------------------------------------------------------------
                                                                       1996     1997     1998     1999     2000 
----------------------------------------------------------------------------------------------------------------
Estimated Authorization Level......................................       60       80       80       20        0
Estimated Outlays..................................................       52       77       80       31        0
----------------------------------------------------------------------------------------------------------------


    Contract Care for Alcohol and Drug Abuse.--For about 15 
years VA has been authorized to contract with third parties to 
treat veterans suffering from alcohol and drug abuse. Section 
1(b) would extend authority to provide contract care from 
December 31, 1995, to December 31, 1997. At the discretion of 
the Secretary, VA would be able to contract with halfway houses 
and other community-based organizations to provide short-term 
care and therapeutic services to veterans with alcohol and drug 
dependencies. In 1994, VA spent almost $9 million on contracts 
with organizations that helped veterans suffering from 
substance abuse. Under this section, VA would spend $6 million 
in the last three quarters of fiscal 1996 and help more than 
6,000 veterans during the entire fiscal year.

                                                                                                                
                                    [By fiscal year, in millions of dollars]                                    
----------------------------------------------------------------------------------------------------------------
                                                                       1996     1997     1998     1999     2000 
----------------------------------------------------------------------------------------------------------------
Estimated Authorization Level......................................        7        9        2        0        0
Estimated Outlays..................................................        6        9        4        0        0
----------------------------------------------------------------------------------------------------------------


    Nursing Home Pilot Project.--Section 1(c) would extend 
until December 31, 1997, a pilot program on nursing homes that 
allows the Secretary of Veterans Affairs to pay for 
alternatives to nursing home care. At present, VA can contract 
with private and community providers of noninstitutional 
nursing home care to provide homemaker and home health services 
to eligible veterans. Certain criteria must be met by veterans 
in order to qualify for the program. In general veterans with a 
service-connected disability of more than 50 percent and 
veterans needing nursing home care for service-connected 
disabilities have priority in receiving this care. Participants 
must be at least 75 years old and meet other specific 
requirements pertaining to health and ability to live 
independently. The cost of noninstitutional care cannot exceed 
65 percent of what it costs VA to provide each individual 
nursing care at its facilities ($32,371 annually per person in 
1994).

                                                                                                                
                                    [By fiscal year, in millions of dollars]                                    
----------------------------------------------------------------------------------------------------------------
                                                                       1996     1997     1998     1999     2000 
----------------------------------------------------------------------------------------------------------------
Estimated Authorization Level......................................       18       19        5        0        0
Estimated Outlays..................................................       16       19        7        0        0
----------------------------------------------------------------------------------------------------------------


    In 1994, VA spent almost $10 million and provided 
noninstitutional care to 1,500 veterans. The number of veterans 
participating in the program is expected to grow to 2,700 in 
1996 and would cost $18 million for that year.
    Health Scholarships Program.--In 1994, VA awarded 
scholarships to 374 nurses and other health professionals. 
These competitive scholarships allowed VA health care 
professionals to enroll in a full-time course of study leading 
to either an associate, baccalaureate, or master's degree. 
Award winners receive payments for tuition, educational 
expenses, and a monthly stipend--all tax free. The program 
helps VA recruit and retain nurses and other health care 
professionals, particularly for health care disciplines in 
which VA is experiencing recruitment difficulties. In return 
for the award, recipients incur a service obligation of two 
years to the VA.

                                                                                                                
                                    [By fiscal year, in millions of dollars]                                    
----------------------------------------------------------------------------------------------------------------
                                                                       1996     1997     1998     1999     2000 
----------------------------------------------------------------------------------------------------------------
Estimated Authorization Level......................................        8       11        3        0        0
Estimated Outlays..................................................        8       11        3        0        0
----------------------------------------------------------------------------------------------------------------


    Section 1(d) would extend the authorization of the program 
from December 31, 1995, to December 31, 1997. For 1996, the 
cost of the program would be almost $8 million for the last 
nine months of the year. VA anticipates that this amount of 
funding will pay for 427 awards.
    Enhanced-Use Leases of Real Property.--Section 1(e) would 
extend for two years the authorization for the VA to use 
enhanced-use leases of real property and would result in no 
significant costs. Enhanced-use leases of real property allow 
the VA to enter into contracts with private companies to 
develop or employ underutilized land or other assets under the 
control of VA. In most instances, VA would allow a private 
developer to build on property owned by VA, and in return the 
developer would allow VA partial use of the newly developed 
facility at below market price. In the past, VA has contracted 
for child-care centers and cafeterias where VA received below 
market prices for its employees who use the facility.
    With the exception of leases made to provide child-care 
services, no more than 20 enhanced-use leases may be entered 
into at any one time. Current law permits VA to make payments 
only for those enhanced-use leases that provide space or 
services for which funds are appropriated in advance.
    Community-Based Residential Care for Chronically Mentally 
Ill Veterans.--In 1994, VA spent just over $24.5 million to 
provide 9,000 Homeless Chronically Mentally Ill (HCMI) veterans 
with community-based residential care. The HCMI program began 
in 1987 and has been reauthorized periodically. The program 
operates out of 71 VA facilities and targets homeless veterans 
with psychiatric or drug abuse problems. VA estimates that the 
number of homeless veterans on any given night varies from 
150,000 to 250,000. Case workers seek out these veterans at 
homeless shelters or on the street and help them find 
appropriate health care and social services. These veterans are 
usually placed in community programs under contract with VA. 
The average cost of providing this service was $39 per day per 
veteran in 1994. The average stay was 71 days.

                                                                                                                
                                    [By fiscal year, in millions of dollars]                                    
----------------------------------------------------------------------------------------------------------------
                                                                       1996     1997     1998     1999     2000 
----------------------------------------------------------------------------------------------------------------
Estimated Authorization Level......................................       28       29        8        0        0
Estimated Outlays..................................................       25       29       12        0        0
----------------------------------------------------------------------------------------------------------------


    VA anticipates that in 1996 it would be able to help almost 
9,700 of the several hundred thousand homeless veterans at a 
cost of over $28 million. Section 1(f) would extend this 
program through December 1997.
    Compensated Work Therapy and Therapeutic Transitional 
Housing (CWT).--Section 1(g) would continue a demonstration 
program aimed at helping eligible veterans with severe mental 
illness and drug and alcohol problems return to mainstream 
society. The program offers veterans treatment while employed 
in the CWT program. This program differs from therapy programs 
because veterans pay rent to offset the cost of acquiring and 
maintaining the property in which they reside. VA has purchased 
46 residences which will have 404 beds when fully operational. 
An additional four residences with a total of 60 beds are 
planned. Expansion beyond 50 residences would require a change 
in current law. To serve 316 veterans in 1994, VA spent about 
$3 million.

                                                                                                                
                                    [By fiscal year, in millions of dollars]                                    
----------------------------------------------------------------------------------------------------------------
                                                                       1996     1997     1998     1999     2000 
----------------------------------------------------------------------------------------------------------------
Estimated Authorization Level......................................        4        4        1        0        0
Estimated Outlays..................................................        3        4        1        0        0
----------------------------------------------------------------------------------------------------------------


    The Homeless Veterans Pilot Program.--Section 1(h) expands 
VA authority to work with community and public groups to 
provide additional services to homeless veterans. This program 
provides seven comprehensive homeless shelters, authorizes 
placement of counselors in 12 homeless shelters, allows for 
grants to public and community organizations to provide 
transitional assistance to veterans, and authorizes VA to make 
per diem payments to organizations eligible to receive grants. 
This program would be authorized until December 31, 1998. 
Reauthorization of the program is needed only to continue the 
homeless grant and per diem programs.

                                                                                                                
                                    [By fiscal year, in millions of dollars]                                    
----------------------------------------------------------------------------------------------------------------
                                                                       1996     1997     1998     1999     2000 
----------------------------------------------------------------------------------------------------------------
Estimated Authorization Level......................................        9        9        9        2        0
Estimated Outlays..................................................        7        9       11        4        0
----------------------------------------------------------------------------------------------------------------


    In 1994, $8 million was appropriated for this program, $5.6 
million of which was used for the grant program. The number of 
veterans affected by the program is uncertain, and VA is 
developing a plan to evaluate its effectiveness. CBO estimates 
that the cost of the program in 1996 would be about $9 million.
    Philippines Memorial Medical Center.--Section 3 would 
repeal the authorization of grants to the Veterans Memorial 
Medical Center (VMMC) in the Philippines. Savings from this 
proposal would be around $500,000 per year. VA has been paying 
about $500,000 a year for the medical treatment of U.S. 
veterans living in the Philippines. Since February 1994, when a 
VA evaluation team determined that the VMMC Medical Center no 
longer met VA's standards as a contract care facility, no new 
veterans have been admitted to the facility. This proposal 
would not affect funds previously authorized and appropriated 
for the VMMC.

                                                                                                                
                                    [By fiscal year, in millions of dollars]                                    
----------------------------------------------------------------------------------------------------------------
                                                                       1996     1997     1998     1999     2000 
----------------------------------------------------------------------------------------------------------------
Estimated Authorization Level......................................       -1       -1       -1       -1       -1
Estimated Outlays..................................................       -*       -1       -1       -1       -1
----------------------------------------------------------------------------------------------------------------
* Less than $500,000.                                                                                           


    Contracts for Utilities, Audie L. Murphy Memorial 
Hospital.--Section 5 would authorize VA to enter into a long-
term joint venture contract with Bexar County Hospital District 
in San Antonio, Texas, for the construction and operation of a 
utility plant on nonfederal property adjacent to the Audie L. 
Murphy Memorial VA Hospital. The provision stipulates, however, 
that VA may enter into such a contract only to the extent that 
funds required of VA under the contract are provided in advance 
by appropriation acts.

                                                                                                                
                                    [By fiscal year, in millions of dollars]                                    
----------------------------------------------------------------------------------------------------------------
                                                                       1996     1997     1998     1999     2000 
----------------------------------------------------------------------------------------------------------------
Estimated Authorization Level......................................        3       -*       -*       -*       -*
Estimated Outlays..................................................        1        2       -*       -*       -*
----------------------------------------------------------------------------------------------------------------
* Less than $500,000.                                                                                           


    The VA hospital in San Antonio and the adjacent Bexar 
County Hospital will soon lose access to chilled water (for air 
conditioning) that they now obtain from the neighboring 
University of Texas Hospital. The provision would allow VA and 
Bexar County Hospital to build jointly a chilled water plant to 
serve both hospitals. Under a preliminary agreement, the 
initial capital cost of constructing the plant and outfitting 
it with chillers would be shared by VA and Bexar County nearly 
equally. The draft agreement also stipulates that VA's capital 
contribution to the joint venture would be no more than $3 
million.
    The cost of chilled water to both parties produced by the 
plant would be based on the ongoing operating costs of the 
plant. None of Bexar County's initial capital contribution or 
subsequent debt service cost could be passed on the VA in the 
form of increased utility charges. Once the plant is in 
operation, the cost of air conditioning the San Antonio VMMC 
would be significantly reduced from current levels. The 
savings, however, would be less than $500,000 a year.
    7. Pay-as-you-go considerations: None.
    8. Estimated cost to state and local governments: None.
    9. Estimate comparison: None.
    10. Previous CBO estimate: None.
    11. Estimate prepared by: Michael Groarke.
    12. Estimate approved by: Paul N. Van de Water, Assistant 
Director for Budget Analysis.

                     Inflationary Impact Statement

    The enactment of the reported bill would have no 
inflationary impact.

                  Applicability to Legislative Branch

    The reported bill would not be applicable to the 
legislative branch under the Congressional Accountability Act, 
Public Law 104-1, because it would apply only to certain 
Department of Veterans Affairs programs and facilities.

                     Statement of Federal Mandates

    The reported bill would not establish a federal mandate 
under the Unfunded Mandates Reform Act, Public Law 104-4.

         Changes in Existing Law Made by the Bill, as Reported

  In compliance with clause 3 of rule XIII of the Rules of the 
House of Representatives, changes in existing law made by the 
bill, as reported, are shown as follows (existing law proposed 
to be omitted is enclosed in black brackets, new matter is 
printed in italics, existing law in which no change is proposed 
is shown in roman):

                      TITLE 38, UNITED STATES CODE

          * * * * * * *

                       PART II--GENERAL BENEFITS

          * * * * * * *

   CHAPTER 17--HOSPITAL, NURSING HOME, DOMICILIARY, AND MEDICAL CARE

                          subchapter i--general

Sec.
1701.  Definitions.
1702.  Presumption relating to psychosis.
     * * * * * * *

 subchapter iv--hospital care and medical treatment for veterans in the 
                       republic of the philippines

1731.  Assistance to the Republic of the Philippines.
1732.  Contracts [and grants] to provide for the care and treatment of 
          United States veterans by the Veterans Memorial Medical 
          Center.
     * * * * * * *

 SUBCHAPTER II--HOSPITAL, NURSING HOME OR DOMICILIARY CARE AND MEDICAL 
                               TREATMENT

Sec. 1710. Eligibility for hospital, nursing home, and domiciliary care

  (a) * * *
          * * * * * * *
  (e)(1) * * *
          * * * * * * *
  (3) Hospital and nursing home care and medical services may 
not be provided under or by virtue of subsection (a)(1)(G) of 
this section after June 30, 1995, or, in the case of care for a 
veteran described in paragraph (1)(C), after December 31, 
[1995] 1998.
          * * * * * * *

Sec. 1712. Eligibility for outpatient services

  (a)(1) Except as provided in subsection (b) of this section, 
the Secretary shall furnish on an ambulatory or outpatient 
basis such medical services as the Secretary determines are 
needed--
          (A) * * *
          * * * * * * *
          (D) during the period before December 31, [1995] 
        1998, for any disability in the case of a veteran who 
        served on active duty in the Southwest Asia theater of 
        operations during the Persian Gulf War and who the 
        Secretary finds may have been exposed to a toxic 
        substance or environmental hazard during such service, 
        notwithstanding that there is insufficient medical 
        evidence to conclude that the disability may be 
        associated with such exposure.
          * * * * * * *

Sec. 1720A. Treatment and rehabilitation for alcohol or drug dependence 
                    or abuse disabilities

  (a) * * *
          * * * * * * *
  (e) The Secretary may not furnish care and treatment and 
rehabilitative services under subsection (a) of this section 
after December 31, [1995] 1997.
          * * * * * * *

Sec. 1720C. Noninstitutional alternatives to nursing home care: pilot 
                    program

  (a) During the period through [September 30, 1995] December 
31, 1997, the Secretary may conduct a pilot program for the 
furnishing of medical, rehabilitative, and health-related 
services in noninstitutional settings for veterans who are 
eligible under this chapter for, and are in need of, nursing 
home care. The Secretary shall give priority for participation 
in such program to veterans who--
          (1) are in receipt of, or are in need of, nursing 
        home care primarily for the treatment of a service-
        connected disability; or
          (2) have a service-connected disability rated at 50 
        percent or more.
          * * * * * * *

SUBCHAPTER IV--HOSPITAL CARE AND MEDICAL TREATMENT FOR VETERANS IN THE 
                      REPUBLIC OF THE PHILIPPINES

          * * * * * * *

Sec. 1732. Contracts [and grants] to provide for the care and treatment 
                    of United States veterans by the Veterans Memorial 
                    Medical Center

  (a) * * *
  [(b)(1) To further assure the effective care and treatment of 
United States veterans in the Veterans Memorial Medical Center, 
there is authorized to be appropriated for each fiscal year 
during the period beginning on October 1, 1981, and ending on 
September 30, 1990, the sum of $1,000,000 to be used by the 
Secretary for making grants to the Veterans Memorial Medical 
Center for the purpose of assisting the Republic of the 
Philippines in the replacement and upgrading of equipment and 
in rehabilitating the physical plant and facilities of such 
center.
  [(2) Grants under this subsection shall be made on such terms 
and conditions as prescribed by the Secretary. Such terms and 
conditions may include a requirement of prior approval by the 
Secretary of the uses of the funds provided by such grants.
  [(3) Funds for such grants may be provided only from 
appropriations made to the Department for the specific purpose 
of making such grants.]
  [(c)] (b) The Secretary may stop payments under a contract 
[or grant] under this section upon reasonable notice as 
stipulated by the contract [or grant] if the Republic of the 
Philippines and the Veterans Memorial Medical Center do not 
maintain the medical center in a well-equipped and effective 
operating condition as determined by the Secretary.
  [(d)] (c)(1) The authority of the Secretary to enter into 
contracts [and to make grants] under this section is effective 
for any fiscal year only to the extent that appropriations are 
available for that purpose.
  (2) Appropriations made for the purpose of this section shall 
remain available until expended.
          * * * * * * *

             PART V--BOARDS, ADMINISTRATIONS, AND SERVICES

          * * * * * * *

    CHAPTER 76--HEALTH PROFESSIONALS EDUCATIONAL ASSISTANCE PROGRAM

          * * * * * * *

                   SUBCHAPTER II--SCHOLARSHIP PROGRAM

          * * * * * * *

Sec. 7618. Expiration of program

  The Secretary may not furnish scholarships to new 
participants in the Scholarship Program after December 31, 
[1995] 1997.
          * * * * * * *

            PART VI--ACQUISITION AND DISPOSITION OF PROPERTY

          * * * * * * *

   CHAPTER 81--ACQUISITION AND OPERATION OF HOSPITAL AND DOMICILIARY 
    FACILITIES; PROCUREMENT AND SUPPLY; ENHANCED-USE LEASES OF REAL 
                                PROPERTY

          * * * * * * *

           SUBCHAPTER V--ENHANCED-USE LEASES OF REAL PROPERTY

          * * * * * * *

Sec. 8169. Expiration

  The authority of the Secretary to enter into enhanced-use 
leases under this subchapter expires on December 31, [1995] 
1997.
          * * * * * * *
                              ----------                              


     SECTION 115 OF THE VETERANS' BENEFITS AND SERVICES ACT OF 1988

SEC. 115. PILOT PROGRAM OF COMMUNITY-BASED RESIDENTIAL CARE FOR 
                    HOMELESS CHRONICALLY MENTALLY ILL AND OTHER 
                    VETERANS.

  (a) * * *
          * * * * * * *
  (d) Duration of Program.--The authority for the pilot program 
authorized by this section expires on [September 30, 1995] 
December 31, 1997.
          * * * * * * *
                              ----------                              


                 SECTION 7 OF THE ACT OF JUNE 13, 1991

SEC. 7. DEMONSTRATION PROGRAM OF COMPENSATED WORK THERAPY AND 
                    THERAPEUTIC TRANSITIONAL HOUSING.

  (a) Demonstration Program.--[During fiscal years 1991 through 
1995, the] The Secretary of Veterans Affairs may carry out a 
compensated work therapy and therapeutic transitional housing 
demonstration program. The demonstration program shall have two 
components, as follows:
          (1) A component, under subsection (c), which provides 
        for direct operation of therapeutic transitional 
        housing in conjunction with the furnishing of 
        compensated work therapy.
          (2) A component, under subsection (d), which provides 
        for the contracting with nonprofit corporations to 
        furnish compensated work therapy in conjunction with 
        the operation of the therapeutic transitional housing.
          * * * * * * *
  (m) Sunset.--The authority for the demonstration program 
under this section expires on December 31, 1997.
                              ----------                              


      HOMELESS VETERANS COMPREHENSIVE SERVICE PROGRAMS ACT OF 1992

SEC. 2. PILOT PROGRAM.

  (a) In General.--Subject to the availability of 
appropriations provided for under section 12, the Secretary of 
Veterans Affairs shall establish and operate, through 
[September 30, 1995] December 31, 1998, a pilot program under 
this Act to expand and improve the provision of benefits and 
services by the Department of Veterans Affairs to homeless 
veterans.
          * * * * * * *

SEC. 3. GRANTS.

  (a) Authority To Make Grants.--Subject to the availability of 
appropriations provided for under section 12, the Secretary of 
Veterans Affairs[, during fiscal years 1993, 1994, and 1995,] 
shall make grants to assist eligible entities in establishing 
new programs to  furnish  outreach,  rehabilitative  services,  
vocational  counseling and  training,  and  transitional  
housing  assistance  to  homeless veterans.
          * * * * * * *

SEC. 12. AUTHORIZATION OF APPROPRIATIONS.

  There are authorized to be appropriated to carry out this Act 
(other than section 8) $48,000,000 for [each of the fiscal 
years 1993, 1994, and 1995] each fiscal year through 1998. 
Nothing in this Act shall be construed to diminish funds for, 
continuation of, or expansion of existing programs administered 
by the Secretary of Veterans Affairs to serve veterans.
                              ----------                              


SECTION 1084 OF THE NATIONAL DEFENSE AUTHORIZATION ACT FOR FISCAL YEARS 
                             1992 AND 1993

SEC. 1084. DISPLAY OF POW/MIA FLAG.

  (a) Display of POW/MIA Flag.--The POW/MIA flag, having been 
recognized and designated in section 2 of Public Law 101-355 
(104 Stat. 416) as the symbol of the Nation's concern and 
commitment to resolving as fully as possible the fates of 
Americans still prisoner, missing, and unaccounted for, thus 
ending the uncertainty for their families and the Nation, shall 
be displayed--
          (1) at each national cemetery and at the National 
        Vietnam Veterans Memorial each year on Memorial Day and 
        Veterans Day and on any day designated by law as 
        National POW/MIA Recognition Day; [and]
          (2) on, or on the grounds of, the buildings specified 
        in subsection (b) on any day designated by law as 
        National POW/MIA Recognition Day[.]; and
          (3) on, or on the grounds of, each Department of 
        Veterans Affairs medical center (except as provided in 
        subsection (e)), on every day on which the flag of the 
        United States is displayed.
          * * * * * * *
  (c) Procurement and Distribution of Flags.--[Within 30 days 
after the date of the enactment of this Act, the] The 
Administrator of General Services shall procure POW/MIA flags 
and distribute them as necessary to carry out this section.
          * * * * * * *
  (e) Special Rule for Display at Department of Veterans 
Affairs Medical Centers.--(1) Upon a determination by the 
director of a Department of Veterans Affairs medical center 
that the daily display of the POW/MIA flag at that medical 
center may be detrimental to the treatment of patients at that 
center, the provisions of subsection (a)(3) shall be 
inapplicable with respect to that medical center.
  (2) Whenever the director of a Department of Veterans Affairs 
medical center makes a determination described in paragraph 
(1), that officer shall submit a report on such determination, 
including the basis for the determination, to the Under 
Secretary for Health of the Department of Veterans Affairs.
  [(e)] (f) POW/MIA Flag Defined.--As used in this section, the 
term ``POW/MIA flag'' means the National League of Families 
POW/MIA flag recognized officially and designated by section 2 
of Public Law 101-355 (104 Stat. 416).

                                   -