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104th Congress                                                   Report
                        HOUSE OF REPRESENTATIVES

 2d Session                                                     104-574
_______________________________________________________________________

 
  AUTHORIZATION OF MAJOR MEDICAL FACILITY PROJECTS AND MAJOR MEDICAL 
FACILITY LEASES FOR THE DEPARTMENT OF VETERANS AFFAIRS FOR FISCAL YEAR 
                      1997, AND FOR OTHER PURPOSES

_______________________________________________________________________


  May 14, 1996.--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. 3376]

      [Including cost estimate of the Congressional Budget Office]

    The Committee on Veterans' Affairs, to whom was referred 
the bill (H.R. 3376) to authorize major medical facility 
projects and major medical facility leases for the Department 
of Veterans Affairs for fiscal year 1997, and for other 
purposes, having considered the same, reports favorably thereon 
with an amendment and recommends that the bill as amended do 
pass.

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

    Page 8, line 3. strike out ``15 days'' and insert in lieu 
thereof ``45 days''.

                              Introduction

    On March 21, 1996, the Subcommittee on Hospitals and Health 
Care received testimony on the fiscal year 1997 Department of 
Veterans Affairs (VA) medical care budget and construction 
priorities. Under Secretary for Health Kenneth Kizer testified 
at the hearing, and was accompanied by Mark Catlett, Assistant 
Secretary of Management and C.V. ``Chuck'' Yarbrough, Associate 
Chief Medical Director for Construction Management.

    On March 29, 1996, the full Committee heard testimony on 
the VA's fiscal 1997 budget, including its construction 
priorities. Testifying were the Honorable Jesse Brown, 
Secretary of Veterans Affairs, accompanied by Dr. Kenneth 
Kizer, Under Secretary for Health; Mr. R.J. Vogel, Under 
Secretary for Benefits; Mr. Jerry Bowen, Director of the 
National Cemetery System; Mr. Mark Catlett, Assistant Secretary 
for Management; and Mr. Robert Coy, Deputy General Counsel. 
Also testifying was the Honorable Frank Nebeker, Chief Judge of 
the U.S. Court of Veterans Appeals, accompanied by Mr. Robert 
F. Comeau, Clerk of the Court; Mr. James Caldwell, Chief Deputy 
Clerk, Ms. Sandra P. Montrose, Executive Attorney to the Chief 
Judge; and Ms. Ann Olson, Budget Officer. Additional witnesses 
were Mr. James Magill, Director, National Legislative Service, 
Veterans of Foreign Wars; Mr. Russell Mank, Legislative 
Director, Paralyzed Veterans of America; Mr. Rick Surratt, 
Assistant National Legislative Director, Disabled American 
Veterans; Mr. Robert Carbonneau, National Legislative Director, 
AMVETS; Mr. John Vitikacs, Assistant Director, Veterans Affairs 
and Rehabilitation Commission, The American Legion; and Mr. 
William Warfield, Deputy Director of Government Relations, 
Vietnam Veterans of America.

    The Subcommittee on Hospitals and Health Care met on May 8, 
1996 and ordered H.R. 3376, as amended, reported favorably to 
the full Committee by unanimous voice vote.

    The full Committee also met on May 8, 1996 and ordered H.R. 
3376, as amended, reported favorably to the House by unanimous 
voice vote.

                      Summary of the Reported Bill

    H.R. 3376 as amended would:

                   TITLE I--CONTRUCTION AUTHORIZATION

    1. Authorize the following projects:

        (a) Lconstruction of an ambulatory care addition for 
        mental health enhancements at the Department of 
        Veterans Affairs medical center in Dallas, Texas;
        (b) Lconstruction of an ambulatory care addition at the 
        Department of Veterans Affairs medical center in 
        Brockton, Massachusetts;
        (c) Lconstruction of an ambulatory care addition for 
        outpatient improvements at the Department of Veterans 
        Affairs medical center in Shreveport, Louisiana;
        (d) Lconstruction of an ambulatory care addition at the 
        Department of Veterans Affairs medical center in Lyons, 
        New Jersey;
        (e) Lconstruction of an ambulatory care addition at the 
        Department of Veterans Affairs medical center in Tomah, 
        Wisconsin;
        (f) Lconstruction of an ambulatory care addition at the 
        Department of Veterans Affairs medical center in 
        Asheville, North Carolina;
        (g) Lconstruction of an ambulatory care addition at the 
        Department of Veterans Affairs medical center in 
        Temple, Texas;
        (h) Lconstruction of an ambulatory care addition at the 
        Department of Veterans Affairs medical center in 
        Tucson, Arizona;
        (i) Lrenovation of nursing home facilities at the 
        Department of Veterans Affairs medical center in 
        Lebanon, Pennsylvania;
        (j) Lenvironmental improvements at the Department of 
        Veterans Affairs medical center in Marion, Illinois;
        (k) Lmodernization of patient wards at the Department 
        of Veterans Affairs medical center in Atlanta, Georgia;
        (l) Lreplacement of a psychiatric bed building at the 
        Department of Veterans Affairs medical center in Battle 
        Creek, Michigan;
        (m) Lward renovation for patient privacy at the 
        Department of Veterans Affairs medical center in Omaha, 
        Nebraska;
        (n) Lenvironmental improvements at the Department of 
        Veterans Affairs medical center in Pittsburgh, 
        Pennsylvania;
        (o) Lrenovation of various buildings at the Department 
        of Veterans Affairs medical center in Waco, Texas;
        (p) Lreplacement of psychiatric beds at the Department 
        of Veterans Affairs medical center in Marion, Indiana;
        (q) Lrenovation of psychiatric wards at the Department 
        of Veterans Affairs medical center in Perry Point, 
        Maryland;
        (r) Lenvironmental enhancement at the Department of 
        Veterans Affairs medical center in Salisbury, North 
        Carolina;
        (s) Lseismic corrections at the Department of Veterans 
        Affairs medical center in Palo Alto, California;
        (t) Lseismic corrections at the Department of Veterans 
        Affairs medical center in Long Beach, California; and
        (u) Lseismic corrections at the Department of Veterans 
        Affairs medical center in San Francisco, California.

    2. Authorize major medical facility leases of a satellite 
outpatient clinic in Allentown, Pennsylvania; a satellite 
outpatient clinic in Beaumont, Texas; a satellite outpatient 
clinic in Boston, Massachusetts; a parking facility in 
Cleveland, Ohio; a satellite outpatient clinic and Veterans 
Benefits Administration field office in San Antonio, Texas; and 
a satellite outpatient clinic in Toledo, Ohio.

    3. Direct a report by the Secretary of Veterans Affairs on 
the health care needs of veterans in East Central Florida.

         TITLE II--STRATEGIC PLANNING FOR HEALTH CARE RESOURCES

    1. Require the Secretary of Veterans Affairs to report to 
Congress on the long-range health planning of the Department.

    2. Expand the scope of information provided in the 
description of proposed construction projects.

    3. Increase the threshold which defines a major medical 
facility project from $3 million to $5 million.

    3. Repeal subsection (b) of Section 301 of P.L. 102-405.

    4. Make technical changes in statutory terminology.

    5. Remove the statutory requirements that the Veterans 
Health Administration be organized under certain clinical 
specialties.

                        TITLE III--OTHER MATTERS

    1. Rename the Department of Veterans Affairs medical center 
Jackson, Mississippi as the ``G.V. Sonny Montgomery Department 
of Veterans Affairs Medical Center.''

    2. Rename the Mountain Home Department of Veterans Affairs 
medical center in Johnson City, Tennessee as the ``James H. 
Quillen Department of Veterans Affairs Medical Center.''

    3. Rename the Department of Veterans Affairs nursing care 
center at the Department of Veterans Affairs medical center in 
Aspinwall, Pennsylvania as the ``H. John Heinz, III Department 
of Veterans Affairs Nursing Care Center.''

    4. Restore the VA's authority to establish Department of 
Veterans Affairs research corporations until December 31, 2000.

                       Background and Discussion

                      Major Construction Projects

    Section 101 of this legislation would authorize major 
construction projects for fiscal year 1997. Several of these 
projects were included in H.R. 2814, which was passed by the 
full Committee in December 1995 but not acted upon by the 
House.

    The Committee proposes authorization of $28.2 million to 
modernize patient wards at the Atlanta VAMC. The modernization 
project would renovate psychiatric, medical and surgical 
patient ward areas in order to provide interior space and 
equipment modernization. By correcting these deficiencies, the 
increasing female veteran population would be better 
accommodated.

    The Committee proposes authorization of $22.9 million for 
the Battle Creek (MI) VAMC to go toward the replacement of the 
psychiatric bed building. The current psychiatric treatment 
units at the facility were built in the 1920s and lack air 
conditioning, elevators and handicapped facilities. The 
proposed 120-bed replacement building would address all of 
these deficiencies and would provide patients with appropriate 
nursing stations, day rooms, treatment rooms, bedrooms, 
seclusion and restraint rooms.

    The Committee proposes authorization of $9.5 million for 
the renovation of several medical and surgical nursing units at 
the Lebanon (PA) VAMC. The renovation would provide for proper 
handicapped accessibility and patient privacy. It would also 
address the concerns of the increasing female veteran 
population at the facility by increasing privacy and updating 
the bathing and toilet facilities. Environmental conditions 
would also be improved by upgrading the facility's building 
infrastructure system.

    The Committee proposes authorization of $11.5 million for 
the Marion (IL) VAMC to go toward complete renovation for four 
medical and surgical wards and the intensive care unit in 
Building 1 of the facility. Improvements which would be made 
include patient privacy, patient environment, fire, life 
safety, handicapped accessibility and utility system 
corrections. Currently, congregate toilets and baths are used 
by patients in the nine- and four-bed rooms. These facilities 
would be eliminated and replaced with single and semi-private 
rooms with baths.

    The Committee proposes authorization of $17.3 million for 
the construction of a new 100-bed inpatient psychiatric 
building to replace the three current buildings at the Marion 
(IN) VAMC. The new facility would conform to current health 
care standards and would meet all applicable patient privacy, 
handicapped accessibility and space planning criteria. Because 
the original buildings are of a significant historical value, 
renovation was prohibited.

    The Committee proposes authorization of $7.7 million for 
the Omaha (NE) VAMC to provide ward renovation for patient 
privacy. Specifically, the project would renovate and upgrade 
four nursing units to meet current criteria for patient privacy 
and support facilities, including the provision of wheelchair 
accessible toilets and showers in each patient room, required 
patient, family and staff support areas on the nursing units 
and upgraded mechanical, plumbing and electrical systems.

    The Committee proposes authorization of $15.1 million at 
the Perry Point (MD) VAMC for patient privacy issues and VA 
space planning criteria. Specifically, this project would 
eliminate congregate bathing facilities, change the location of 
nursing stations, meet handicapped accessibility requirements, 
provide additional support space on wards, upgrade 
infrastructure systems and replace the elevators.

    The Committee proposes authorization of $17.4 million for 
environmental improvements at the Pittsburgh (PA) VAMC. This 
project, an upgrade of three nursing units and a renovation of 
existing space, would provide patient privacy, patient 
environment, life safety, handicapped accessibility and utility 
system corrections. The current nursing units were constructed 
in 1954 and have seen little renovation since that time.

    The Committee proposes authorization of $18.2 million at 
the Salisbury (NC) VAMC to renovate and modernize the facility. 
Currently, less than 10 percent of the building's existing 
nursing units have private toilets. This renovation would 
provide private and semi-private rooms with baths in order to 
allow privacy for patients, including the increasing female 
population. The funding would also go toward making the 
facility handicapped-accessible and to upgrade indoor air 
quality.

    The Committee proposes authorization of $26 million for the 
renovation of direct care buildings at the Waco (TX) VAMC. This 
renovation would correct existing fire safety and environmental 
deficiencies. Additions would be built to each affected 
building in order to allow space to meet patient privacy and 
space requirements.

    Additionally, the Committee proposes authorization of $28.8 
million for an ambulatory care addition at the Asheville (NC) 
VAMC. This three-story ambulatory care addition would be 
constructed on the side of the main hospital building in order 
to replace and expand key outpatient services. The eye clinic, 
dental clinic and laboratory would be relocated to this area, 
while a new emergency care unit with a dedicated entry would be 
constructed. This addition would be constructed in response to 
severe space restrictions at the facility for outpatient 
services.

    The Committee proposes authorization of $19.9 million for 
mental health enhancements at the Dallas (TX) VAMC. A multi-
level mental health addition would be constructed on top of the 
existing two-level ambulatory care building. This new 
construction would enable the relocation of mental health 
inpatient nursing units into new space that meets applicable 
patient privacy, handicapped accessibility and space planning 
criteria.

    The Committee also proposes authorization of $13.5 million 
for an ambulatory care addition at the Brockton (MA) VAMC. This 
addition would be constructed at the corner of the main 
hospital building and would replace and expand key outpatient 
services. This addition would be constructed because the 
existing outpatient space provides a poor patient care 
environment, as it is dispersed over three floors.

    The Committee proposes authorization of $21.1 million at 
the Lyons (NJ) VAMC to go toward the construction of an 
ambulatory care addition. This project would address the need 
to provide additional space for veterans in need of outpatient 
services at the facility. The two-story addition would be 
constructed in a courtyard among three current buildings. A 
fourth building would be demolished to make room for the 
addition.

    The Committee proposes authorization of $25 million for 
outpatient improvements at the Shreveport (LA) VAMC. A three-
story ambulatory care addition would be constructed adjacent to 
the main hospital building to house expanded outpatient 
services, emergency services and to provide for relocation of 
radiology and nuclear medicine into new space that meets all 
applicable standards and criteria.

    The Committee proposes authorization of $9.8 million for an 
ambulatory care addition at the Temple (TX) VAMC. The current 
outpatient area was designed for 78,000 annual visits; however, 
the workload for FY 1993 alone was over 150,000. Additionally, 
space restraints require outpatient functions to be performed 
throughout the hospital and patients to travel long distances 
for clinic care.

    The Committee proposes authorization of $12.7 million for 
an ambulatory care addition to the Tomah (WI) VAMC. A two-story 
ambulatory care addition connected physically to Building 400 
would be constructed to house primary and specialty clinics, as 
well as customary support functions. Included in these 
categories are ambulatory care, a mental health clinic, an 
outpatient pharmacy and a laboratory. This addition would 
replace the existing ambulatory center, which currently 
operates with architectural and mechanical systems dating back 
to the 1940s.

    The Committee proposes authorization of $35.5 million for 
an ambulatory care addition at the Tucson (AZ) VAMC to expand 
essential outpatient services and to resolve space deficiencies 
which impact quality of care and staff efficiency. The addition 
would provide over 90,000 square feet of new clinic and 
laboratory space for workload projections of 189,000 outpatient 
visits by the year 2005.

    The Committee also proposes authorization of $20.2 million 
for seismic corrections at the Long Beach (CA) VAMC. The 
seismic upgrades would include the addition of new shear walls, 
thickening of existing shear walls and enlarging of the 
existing columns beneath the shear walls. The funding would 
also go toward fire protection, Americans With Disabilities Act 
specifications and the correction of mechanical and electrical 
code deficiencies. The buildings to receive these improvements 
are over 50 years old and are in serious need of seismic 
reinforcement.

    The Committee proposes authorization of $36 million to 
correct seismic deficiencies at the Palo Alto (CA) VAMC. Work 
would be done to replace the concrete roof, shore up the 
structural steel, adjust the partition, provide asbestos 
abatement, reinstall insulating materials and replace the 
ceiling and floor finishes. The heating system would also be 
replaced.

    Finally, the Committee proposes authorization of $26 
million for seismic corrections at the San Francisco (CA) VAMC. 
A number of buildings have seismic deficiencies and are in dire 
need of correction. The addition would be built in order to 
accommodate a mental health clinic and alcohol treatment 
clinic, a day treatment center, a hospital director's suite 
addition, the psychiatry service administration and psychology, 
research and fiscal departments. A study determining the cost 
of seismically upgrading existing buildings concluded that it 
would be cost-effective to replace the buildings instead.

                       Major Construction Leases

    The Committee recognizes the need for the VA to enter into 
lease agreements to serve veterans' communities across the 
country. Accordingly, H.R. 3376 would authorize the lease of a 
satellite outpatient clinic in Allentown, Pennsylvania for 
$2.159 million, a satellite outpatient clinic in Beaumont, 
Texas for $1.94 million, a satellite outpatient clinic in 
Boston, Massachusetts for $2.358 million, a parking facility in 
Cleveland, Ohio for $1.3 million, a satellite outpatient clinic 
and Veterans Benefits Administration field office in San 
Antonio, Texas for $2.256 million and a satellite outpatient 
clinic in Toledo, Ohio for $2.223 million.

                       Construction Authorization

    H.R. 3376 would authorize $422.3 million for major medical 
construction projects at 21 VA facilities. Another $12.236 
million would be authorized for the Medical Care account to 
fund six leases. The projects selected constitute a package, 
all of which were either proposed by the Administration or 
address areas which VA has deemed a high priority. In proposing 
to authorize these projects, the Committee has developed a 
balanced list, comprising projects which would expand VA's 
ambulatory care capacity, strengthen seismically vulnerable 
buildings, and bring a number of aging facilities up to 
acceptable patient-privacy standards. In proposing to authorize 
these projects, the Committee recognizes the many other 
facilities with similar construction needs, and the importance 
of refining VA's planning processes to review and address those 
needs on a priority basis.

                          East Central Florida

    The Committee attaches a high priority to meeting the needs 
of veterans in Florida, a state which has experienced and will 
likely continue to experience an increase in its veteran 
population. While Florida has seen a growth in VA's service-
delivery capacity, efforts to meet the needs of the veterans in 
east central Florida remain in question.

    Two years ago, Congress appropriated construction funds to 
convert the former Orlando Naval Training Center Hospital 
(which was transferred to the Department of Veterans Affairs) 
into a nursing home. VA currently operates an outpatient clinic 
at that facility, but has not begun construction of the nursing 
home care unit. Congress also appropriated $17.2 million for 
the design of a 470-bed medical center and 120-bed nursing home 
in Brevard County, Florida. That project, developed and 
proposed by the Department of Veterans Affairs, called for 230 
psychiatric beds, 60 intermediate care beds, and an ambulatory 
care clinic, as well as a number of surgical and intermediate 
medicine beds. The Conference Report on the Fiscal Year 1996 
VA/HUD appropriations bill, however, called for allotting that 
design money, along with $7.8 million in new funds, to design 
and construct a comprehensive outpatient clinic in Brevard 
County. The Committee believes that $25 million may exceed the 
construction costs VA will incur for this clinic. While having 
provided for veterans' outpatient needs, the conference report 
makes no provision for meeting inpatient care needs that were 
to have been addressed by the Brevard project. The lack of 
long-term psychiatric beds in the State of Florida, for 
example, makes an examination of the medical needs of veterans 
in east central Florida imperative.

    In light of this recent Congressional action, the Committee 
believes that a reassessment of the health care needs of 
veterans in east central Florida is needed. Section 104 of the 
bill would require the Secretary to report to the committees on 
these veterans' needs. It would specifically require the 
Secretary to include in that report his views on how those 
needs could best be met through available appropriations 
(discussed above), to include that fraction of the moneys 
appropriated for a clinic in Brevard County which may not be 
needed for construction of a comprehensive clinic. The 
Secretary's analysis should also include a re-examination of 
other uses for the Orlando facility such as the interim use of 
the facility to meet inpatient needs, including acute medical 
surgical and psychiatric, in light of the changed circumstances 
for construction of an inpatient facility for those veterans 
residing in the catchment area of east central Florida.

              Strategic Planning for Health Care Resources

    Section 201 of the reported bill would require the VA to 
develop a five-year strategic plan for its health care system 
which specifically addresses the integration of planning 
efforts starting at the grass roots or local level, coordinated 
within a prescribed geographic network, and then formulated 
into a national plan. The plan would be updated on an annual 
basis and submitted no later than January 31st of each year.

    The VA strategic plan which would be required by the bill 
would address such factors as population trends, resource 
distribution, cost of patient care, capacity of non-Federal 
providers within prescribed geographic networks, the missions 
of each facility with the network, and specifically, the 
distribution of specialized services on a network and national 
level.

    Because of the unique needs of veterans, specialized 
services to treat and rehabilitate veterans with disabilities 
including spinal cord dysfunction, blindness, amputations, and 
mental illness are core programs, vital to the overall mission 
of the Department of Veterans Affairs. VA's core 
beneficiaries--service-connected disabled and medically 
indigent veterans--have a need for these services that cannot 
be easily or effectively met in the private sector. The 
Committee believes that planning for these services, although 
important at the geographic network level, must be part of a 
national VA strategic plan because of their cost and 
complexity.

    With the understanding that the Veterans Health 
Administration has undertaken countless planning exercises over 
the years, the Committee views coordination and integration of 
the planning process as essential to effective execution of a 
strategic plan. The plan would be required to lay out how 
coordination would occur within and among networks. It would 
also delineate the array of services VA would provide, such as 
those provided in-house and through contract, and the market 
penetration or the percentage of veterans it would expect to 
serve. As part of this effort, the VA would develop goals to 
increase its efforts to address the needs of service-connected 
veterans.

    In calling for the assignment of mission statements or 
changes to current missions, the Committee views this effort as 
part of the continuing shift to managed care to ensure that 
veterans health care is cost-effective and mirrors those 
practice patterns of the private sector that seek to promote 
quality care. There is also a broad consensus that effective 
planning and delineation of facility missions would speed the 
realignment process to reduce duplication of services and 
contribute to the more equitable distribution of resources. The 
Committee is very supportive of the efforts of the Under 
Secretary for Health as he implements his ``Vision for 
Change,'' and views the strategic planning requirement of the 
bill as parallel and complementary to the efforts of the 
Department. It is inherent that local health care facilities 
and networks have the authority and responsibility to operate 
programs in ways that meet veterans' needs.

    With the understanding that the veteran population is 
undergoing significant change both as it ages and declines in 
absolute numbers, the planning efforts of the Department must 
begin to address this phenomenon. The plan would also account 
for changing practice patterns, including increased reliance on 
the decreasing need for large inventories of hospital beds and 
even hospitals themselves. It is with this understanding that 
the Committee believes that strategic planning efforts must 
consider alternatives to ``bricks and mortar'' and rely more on 
such cost-effective, non-institutional alternatives to care 
delivery such as the Department's efforts to establish points 
of access in approximately 180 locations nationwide.

    The Committee has expressed its concern on numerous 
occasions with VA's inability to provide for greater equity of 
access for veterans on a nationwide basis. VA's reports show 
greater availability and accessibility to care for veterans in 
so-called ``Rust Belt'' states than for those veterans residing 
in ``Sun Belt'' states. In an effort to correct this disparity, 
the bill would require the Department to specifically compare 
expenditures of resources of patients by network. The plan 
should also address how the mix of professionals and use of 
various classes of health care professionals would affect the 
cost and quality of care delivered to veterans. The plan should 
also address how resources will be redistributed to move toward 
relative parity for veterans nationwide. The Committee 
understands that the achievement of this particular goal may 
require time and the incremental shifting of resources is 
currently tied to the operation of facilities and personnel.

    Within the changing environment of health care, the excess 
capacity of non-Federal providers has taken on greater 
significance in the provision of cost-effective services and is 
a factor to be considered within the overall VA strategic plan. 
Other factors such as the increased use of contract care, 
opportunities for ``sharing'' arrangements, competition among 
health providers, and the desire of veterans to obtain health 
services within their local community, also merit continued 
assessment and consideration by VA and should be addressed in 
their strategic planning efforts.

    Consistent with the position reflected in this provision, 
the Committee, in its report on the authorization of major 
medical construction projects for Fiscal Year 1995, to 
accompany H.R. 4425, highlighted the importance of bringing 
services to the veteran to the maximum extent possible. In that 
connection, the Committee cited the important role that small-
scale community-based clinics can play in serving communities 
remote from VA facilities but with significant veteran 
populations. The report cited Dothan, Alabama as an example, 
with more than 38,500 veterans residing within a 50-mile 
radius, and with veterans having to travel over 100 miles to 
receive care at the nearest VA facility. While the Committee 
encouraged the Secretary ``to take a long look'' at 
establishing community-based clinics in Dothan and similar 
communities, it is regrettable that the need has not been met 
at Dothan. The Committee's review of the circumstances at 
Dothan strongly reflect a need for a community-based clinic and 
an active interest in the community and on the part of VA 
officials in developing a means of primary care access in 
Dothan. The Committee believes that the Tuskegee and Montgomery 
VA Medical Centers could work together to develop such a 
clinic, and directs the Secretary to establish this needed 
clinic.

    In this same vein, the Committee also notes the need for 
outpatient health care services in LaSalle, County, IL. The 
problems of access to care were highlighted during an April 22, 
1996 Subcommittee on Hospitals and Health Care field hearing 
which examined the problem in depth. Currently 12,000 veterans 
reside in LaSalle County, a rural farm area approximately 80 
miles from Chicago which is served by the Hines VA Medical 
Center. A recent cost study by the LaSalle County Veterans' 
Assistance Council showed that annually $30,000 are expended to 
transport veterans to the Hines Medical Center and that the 
costs for 1996 will exceed $50,000. Testimony by the Veterans 
Integrated Service Network director (VISN 12) and other 
community and veterans groups strongly supported the 
establishment of an ambulatory care access point within the 
county. The Committee believes that the establishment of a 
community care clinic supports the overall goals of the 
Veterans Health Administration to provide accessible, cost-
effective care for eligible veterans and therefore directs the 
Secretary to establish this needed clinic at the most 
appropriate site to serve veterans in La Salle County, IL.

                  Construction Project Prioritization

    The Committee's responsibility to authorize major medical 
construction projects and major medical leases makes it 
important that the Committee have objective tools with which to 
distinguish among the many competing VA construction projects 
awaiting authorization and funding. Tight budgets further 
heighten the Committee's need for reliable data regarding the 
relative need and priority of VA construction projects. The 
Committee is cognizant of the VA's long-standing efforts to 
refine a prioritization methodology aimed at providing an 
objective scoring system. Section 201 would provide for a 
compilation of, and reporting on, those projects which 
constitute, by category, the Department's current top 20 major 
medical construction projects. The measure would call for an 
annual report on the relative ranking of each project, compiled 
by category, and for each project, a description of the 
specific factors that account for the particular rank of each 
listed project. To assist the Committee and assure integrity to 
the process, the report is also to include a detailed 
explanation for any change in the rank and score of a project 
from one report to the next.

    The annual authorization process requires the Committee to 
examine in detail VA's construction proposals and other pending 
projects. The information called for in this report, as well as 
the more detailed rationale for VA's construction proposals 
required by section 202 of the bill, will assist the Committee 
in both its authorization and oversight roles.

                Construction Authorization Requirements

    Under current law, adopted in Public Law 102-405, a project 
for construction, alteration, or acquisition of a medical 
facility involving a total expenditure of more than $3 million 
constitutes a ``major'' project, requiring congressional 
authorization.

    The minor construction account provides a flexible source 
of funding--not subject to the authorization requirement--for 
projects which are not major in scope. That account has become 
increasingly important in helping VA move from an inpatient-
care-focused system to one which relies more heavily on 
ambulatory care, in keeping with the health care delivery model 
in the community. Many VA facilities have recognized the need 
to convert underutilized or closed hospital wards into 
additional clinic capacity. In many instances, such projects 
cannot be carried out with minor construction funds because of 
the $3 million limit. While the major construction account 
continues to be critical to support ambulatory care additions, 
for example, the imposition of an authorization requirement for 
a ``minor'' project under $5 million to convert ward space into 
additional outpatient treatment capacity, for example, can be a 
cumbersome, time-consuming requirement.

    In adopting a construction authorization requirement, the 
Congress in Public Law 102-405 also made provision for 
``grandfathering'' projects for which funds were appropriated 
before the date of enactment. Since the law's enactment, 
Congress has appropriated additional funds for several 
``grandfathered'' projects. Sufficient time has elapsed, 
however, to permit earlier-funded projects to win additional 
needed funding without the requirement for specific 
authorization. As such, there remains no justification for 
excepting projects, which may no longer merit priority, from 
congressional authorization and the review associated with the 
authorization process. Section 203(b) would thus repeal the 
``grandfathering'' provision effective for fiscal year 1998 
funding.

    While seeking to refine its role in the authorization of 
construction projects, the Committee believes that its 
oversight role into the construction planning process should 
not confine its scope to project authorization. In that regard, 
the Committee anticipates that VA construction planning will 
necessarily change with the reorganization of the Veterans 
Health Administration and with implementation of the strategic 
planning process which would be established under section 201. 
The Committee believes, however, that it can conduct more 
effective oversight through an additional measure that would 
review potentially large projects before the Department expends 
substantial sums in conceptual development. VA has long drawn 
on an advance planning fund to provide ``seed money'' to 
conduct preliminary development of future construction 
projects. The advance planning fund permits VA to do the 
complex developmental work including definition of specific 
requirements, development of alternative conceptual approaches 
for correcting perceived deficiencies, and, after selection of 
an appropriate concept, preliminary design drawings. The 
Committee does not seek to upset this process or to inject an 
authorization requirement into advance planning. Section 203(c) 
would, however, provide a role for targeted Committee review by 
requiring the Secretary to notify the committees of any 
proposed obligation in excess of $500,000 of Advance Planning 
Funds for project.

       Veterans Health Administration Headquarters Reorganization

    With the submission in March 1995 of its proposed ``Vision 
for Change'' of the Veterans Health Administration, VA's Under 
Secretary for Health proposed a plan to reorganize both VA 
field facilities into ``networks'' (and replace the 
administrative layer of VHA Regional Offices), as well as to 
streamline VHA's ``headquarters'' office.

    The Department submitted draft legislation on June 22, 
1995, which, in pertinent part, would ``facilitat[e] the 
reorganization of VHA's headquarters.'' VA's transmittal 
letter, in citing the need for such legislation, stated that 
the ``current centralized management model for VHA, which is in 
part required by statute, impedes the system's ability to adapt 
to the rapidly changing health-care environment.'' The VA's 
draft legislation would eliminate statutory requirements 
identifying required specified clinical service positions in 
the Office of the Under Secretary. The changes VA proposed were 
characterized as necessary to provide organizational 
flexibility.

    Section 205 proposes many of the changes VA sought in its 
draft bill. While it would generally provide the Under 
Secretary the breadth of flexibility he requested, the reported 
bill adds language which would ensure that that Office is 
sufficiently staffed to provide expertise the Committee 
believes is needed. Thus, the reported bill requires the Under 
Secretary to ensure that that Office is staffed to provide 
appropriate expertise in clinical care disciplines generally as 
well as in the unique, specialized VA programs such as blind 
rehabilitation, prosthetics, spinal cord dysfunction, mental 
illness, and geriatrics and long-term care. This requirement 
would not be met, in the absence of staff dedicated to these 
program areas, by ad hoc arrangements such as the use of field 
consultants or field clinician work-groups.

       Renaming of the VA Medical Center in Jackson, Mississippi

    This section of the bill would change the name of the 
Jackson, Mississippi, VA Medical Center to the G.V. Sonny 
Montgomery Department of Veterans Affairs Medical Center.

    In recognition of Mr. Montgomery's extraordinary thirty 
years of service in the House of Representatives, and his 
monumental contributions not only to the veterans of 
Mississippi, but to all of America's veterans, the entire 
Mississippi State Delegation in concert with the veterans 
service organizations of the State of Mississippi and the 
citizenry of Jackson, Mississippi, have requested that the 
Jackson VA Medical Center be re-designated the G.V. Sonny 
Montgomery Department of Veterans Affairs Medical Center. In so 
honoring Mr. Montgomery, the Congress would establish a fitting 
recognition of this unique member's 30 years of distinguished 
House service, his extraordinarily productive fourteen-year 
chairmanship of the Veterans Affairs Committee, and twenty-five 
years of vigorous, dedicated work on the Armed Services and 
National Security Committees for a strong national defense and 
on behalf of America's servicemen and women.

    Sonny Montgomery's career has been one of extraordinary 
service to his country. His service in World War II and later 
in the Mississippi National Guard shaped a lifelong commitment 
to a strong national defense. As an advocate of peace through 
strength, Montgomery has consistently urged that if the nation 
is to be strong and realize true security, it must treat its 
defenders with dignity. That principle has guided Montgomery's 
actions throughout his long congressional career.

    It is entirely fitting that the Jackson VA Medical Center 
be named for this individual, because Representative 
Montgomery's record of service to America's defenders, its 
soldiers, sailors, airmen, and its veterans of the armed 
forces, is virtually unparalleled. In fact, it has earned him 
the appellation, ``Mr. Veteran.'' That title celebrates his 
dedication to a cause, and his record of constancy, relentless 
advocacy, and legislative initiative. But it also celebrates 
the enormity of his accomplishments.

    Those achievements have not necessarily come easily. 
Montgomery, a retired major general, waged relentless campaigns 
to win enactment of his two most widely acclaimed legislative 
victories, enactment of the Montgomery G.I. Bill, an 
educational assistance program for our nation's veterans, and 
establishment of the Veterans Administration as a Cabinet-level 
department of government. The Montgomery GI Bill is providing 
millions of young Americans the opportunity to earn money for 
college through service in our nation's armed forces, thus 
enhancing their transition from military to civilian life. 
Additionally, this program serves as an effective recruitment 
and retention tool for the military services. Elevating VA to 
the Cabinet has given veterans affairs a level of stature, 
access, and advocacy not seen since World War II. Both 
legislative initiatives have, thus, had deep, lasting impact in 
strengthening vital government programs and improving the lives 
of millions--young servicemen and women and veterans of the 
nation's armed forces.

    Montgomery's achievements have not been limited, however, 
to high-visibility, high-stakes campaigns. His legislative 
record is foremost one of steady, patient, incremental 
progress, consistently a product of hard work and consensus-
building. While only a small number of bills among the 
voluminous body of legislation he has authored has commanded 
major headlines, the totality of his record is staggering. As 
Chairman of the House Committee on Veterans Affairs, Montgomery 
led the development of a remarkable body of laws. It may fairly 
be said that he has left a legacy to America's veterans through 
his relentless efforts to protect, improve, and expand their 
special benefits and services.

    In addition to his unending work on behalf of veterans, the 
qualities of leadership, commitment, and dedication in this 
rare man led him to champion the search for answers to the 
wrenching questions regarding America's missing in action. In 
1975 and 1976, he chaired the House Select Committee on Missing 
Persons in Southeast Asia. He traveled to Hanoi in 1977 as a 
member of the presidentially-appointed Woodcock Commission 
seeking additional information about missing servicemen. He was 
appointed Chairman of the Special House Committee on Southeast 
Asia in 1978 to conduct further efforts on behalf of the MIAs. 
In all, this quest led him on 14 trips to Vietnam. In 1990, he 
led the House delegation that successfully negotiated with the 
North Korean government to bring home the first set of remains 
of U.S. servicemen missing in action during the Korean War.

    Paralleling his service to the veterans of this country and 
his work on behalf of such deeply-felt causes as the tragedy of 
America's missing-in-action, Montgomery has long been a key 
participant in shaping national security policy. With twelve 
terms on the Armed Services Committee (now the National 
Security Committee), Montgomery has become the senior Democrat 
member on both the Military Personnel and Compensation 
Subcommittee and the Military Installations and Facilities 
Subcommittees. In this arena, Montgomery has been a tireless 
and outspoken advocate for National Guard and Reserve Affairs.

    In the Congress, Sonny Montgomery has been more than the 
sum of his legislative and related accomplishments. He has been 
a leader, a forger of alliances, a consensus-builder, a figure 
to whom other members looked for advice. He has been an 
institution within the institution, freely sharing his thoughts 
with colleagues--whether from his familiar seat on the aisle on 
the House floor, or at such gatherings as the Congressional 
Prayer Breakfast.

    These qualities have certainly not escaped recognition. 
Rep. Montgomery's record of public service has earned him many 
awards of honor. These include the Distinguished Service 
Citation by the Reserve Officers Association of the United 
States, the Congressional Award by the Veterans of Foreign 
Wars, the Silver Helmet Congressional Award from the AMVETS of 
World War II, the Harry S. Truman Award from the National Guard 
Association of the United States, and the ``Champion of VA 
Research Award'' from the National Association of Veterans' 
Research and Education Foundations. He recently was presented 
the Department of Defense Medal for Distinguished Public 
Service, the highest award presented to any civilian by the 
Secretary of Defense.

    Prior to his election to Congress, Montgomery served for 
ten years in the Mississippi State Senate, where his 
accomplishments include the introduction and enactment of 
legislation creating the Mississippi Authority for Educational 
Television. He was first elected to the U.S. House of 
Representatives in 1966.

    Representative Montgomery is a retired Major General in the 
Mississippi National Guard, having served more than 35 years in 
the military. His active and reserve service included duty in 
World War II in the European Theater. He was a company 
commander in the 31st National Guard Infantry Division when it 
was called to active duty during the Korean Conflict; however, 
the Division was not sent overseas. Among his military awards 
are the Legion of Merit, Meritorious Service Medal, Bronze Star 
of Valor, Combat Infantry Badge, Army Commendation Medal, and 
the Mississippi Magnolia Cross Award.

    He was born in Meridian, Mississippi, and was educated at 
the Meridian Public Schools, the McCrallie School in 
Chattanooga, TN; and Mississippi State University, where he 
received a B.S. degree.

      Renaming of the VA Medical Center in Johnson City, Tennessee

    H.R. 3376 would rename the Mountain Home Department of 
Veterans Affairs Medical Center in Johnson City, Tennessee as 
the ``James H. Quillen Department of Veterans Affairs Medical 
Center.''

    Congressman Quillen is retiring after 34 years as a 
distinguished Member of Congress from eastern Tennessee. A 
World War II veteran of the United States Navy, he is a member 
of numerous veterans' organizations and has fought tirelessly 
for the veterans in his district in across the nation.

    James Quillen was born on January 11, 1916 near Gate City, 
Virginia, one of ten children born to tenant farmers. The 
family moved to Kingsport, Tennessee shortly thereafter. At the 
age of 19, he started his own newspaper, and at one time was 
the youngest newspaper publisher in the nation.

    Just as he was getting his newest venture, a daily, off the 
ground, his country called. From 1942 until 1946, he served in 
the United States Navy, rising in rank from Ensign to full 
Lieutenant. His tour of duty took him from the Naval Air 
Station in Brunswick, Maine to the aircraft carrier U.S.S. 
Antietam.

    After the war, Mr. Quillen was active in the real estate, 
construction and insurance businesses. In 1952, he married 
Cecile Cox.

    Soon after, he was elected to the Tennessee Legislature, 
where he served on the Legislative Council and was Minority 
Leader in 1959 and 1960. He was elected to the House of 
Representatives in 1962, where he has served ever since. He is 
the dean of the Tennessee delegation and holds the state record 
for longest continuous House service.

    Since 1965, Mr. Quillen has been a member of the 
prestigious Rules Committee. In that capacity, he has fought 
for budget restraints, lower taxes, workable health care, 
education and veterans' issues. In the beginning of the 104th 
Congress, he was named Chairman Emeritus of the Committee.

    He has been awarded numerous awards from organizations and 
groups throughout Tennessee. In 1986, he was named Tennessee 
Statesman of the Year, and Interstate Highway 181 in Northeast 
Tennessee is named in his honor as a Parkway.

    Above all, Congressman Quillen has been devoted to 
improving health care for citizens of Tennessee and throughout 
the country. His battle to establish a medical school at East 
Tennessee State University was successful, and the school has 
been named the James H. Quillen College of Medicine. Another 
medical facility, the James H. and Cecile Cox Quillen Center 
for Rehabilitative Medicine in Johnson City, was dedicated in 
1991. Additionally, in 1994, the Holston Valley Hospital and 
Medical Center in Kingsport named its new cardiac wing in honor 
of the congressman as the James H. Quillen Regional Heart 
Center.

    Congressman Quillen's work on behalf of veterans clearly 
warrants this action. Chairman Stump, on April 25, 1996, 
introduced legislation authorizing the renaming of this VAMC to 
honor Mr. Quillen. This bill, H.R. 3320, was cosponsored on a 
bipartisan basis by the entire Tennessee delegation and by 
every member of the Veterans' Affairs Committee, and was 
incorporated into H.R. 3376.

   Renaming of the VA Nursing Care Center in Aspinwall, Pennsylvania

    John Heinz was a respected and valuable Representative and 
Senator who served Pennsylvania with vigor for 20 years. His 
tragic death in a plane crash in 1991 was shocking and 
heartbreaking to the millions of Americans who knew him or knew 
of his work. It is with great respect to his memory that the 
Committee recommends that the Aspinwall VA Nursing Care Center 
be renamed the ``H. John Heinz, III Department of Veterans 
Affairs Nursing Care Center.''

    Senator Heinz, an Air Force veteran, was known for his work 
on behalf of the elderly. He helped establish the House Select 
Aging Committee in the 1970s and was steadfast in his advocacy 
of Social Security and Medicare.

    Senator Heinz was born in Pittsburgh in 1938 and graduated 
from Yale University in 1960. He received a graduate degree 
from Harvard Graduate School of Business Administration in 
1963. In 1971, he ran for and won a House seat in a special 
election to replace a deceased Member. In 1976, he was elected 
to the United States Senate, where he was re-elected twice and 
served until his untimely death.
    Late last year, Rep. Michael Doyle introduced legislation 
providing for this name change. The bill, H.R. 2760, was 
cosponsored by the entire Pennsylvania delegation.

                        VA Research Corporations

    In 1988, Congress, in Public Law 100-322, authorized the 
Department of Veterans Affairs to establish nonprofit 
corporations at individual VA medical centers in order to 
facilitate and foster the conduct of VA medical research. The 
establishment of such corporations was intended to create 
mechanisms which could accept public and private grants, and 
administer funds, for support of VA-approved research. These 
corporations have served as flexible mechanisms to enable VA 
clinicians to carry out research projects for which funding 
might not be available through VA's own research appropriation. 
The now more than 80 corporations are self sustaining and 
require no appropriation.

    Research corporations at some of VA's major hospitals have 
received and administer relatively substantial sums--more than 
$1 million at many of the largest. For calendar year 1994, VA 
research corporations received a total of almost $49 million 
(up from $37 million in 1993).

    During 1994, more than 950 VA investigators conducted some 
1700 research initiatives supported by donations and grants to 
VA research corporations. The overwhelming majority of 
corporation-funded research is clinically focused and has a 
direct impact on patient care. While these efforts further the 
advancement of medical knowledge, they also bring additional 
resources that benefit veterans' care. For example, the 
physicians and nurses who carry out this research also provide 
care to veterans during the course of their research studies. 
Also, the research funded through the corporations often brings 
veterans access to the latest drugs and technology. In helping 
to provide equipment, treatment, and staff, while defraying the 
cost of overhead for conducting research, the corporations help 
VA to serve veterans without cost to the VA budget.

    With the expiration in 1992 of VA's authority to establish 
additional research corporations, a significant number of VA 
facilities, including several major VA medical centers, do not 
have a research corporation to support their research programs. 
Section 304 of the reported bill would extend VA's authority to 
establish additional research corporations until December 31, 
2000.

                      Section-by-Section Analysis

    Section 101(a) would authorize 8 major medical facility 
ambulatory care addition projects.

    Section 101(b) would authorize 10 major medical facility 
environmental improvement projects.

    Section 101(c) would authorize 3 major medical facility 
seismic correction projects.

    Section 102 would authorize the VA to enter into 6 major 
medical facility leases.

    Section 103(a) would authorize $422.3 million for projects 
authorized in section 101 and $12.236 million for leases 
authorized in section 102.

    Section 103(b) would provide that the major construction 
projects provided for in title I could only be carried out 
using funds appropriated for fiscal year 1997 or the previous 
year.

    Section 104(a) would require the Secretary to report to the 
Veterans' Affairs Committees not later than 60 days after the 
date of enactment of this Act, on the health care needs of 
veterans in east central Florida, and to include in that report 
the Secretary's views as to the best means of meeting such 
needs (and particularly their needs for psychiatric and long-
term care).

    Section 104(b) would limit the Secretary's authority to 
obligate funds, other than for working drawings, for the 
conversion of the former Orlando Naval Training Center in 
Orlando, Florida to a nursing home care unit until 45 days 
after the date on which the report required in section 104(a) 
is submitted.

    Section 201 would amend section 8107 of title 38, United 
States Code, to eliminate the requirement that the Department 
provide an annual report on the Department's five-year medical 
facility construction plans, and substitute a broader report 
requirement on long-range health planning. The required report 
is to include (1) a strategic plan for provision of care 
(including provision of services for the specialized treatment 
and rehabilitative needs of disabled veterans) through networks 
of VA medical facilities operating within prescribed geographic 
service delivery areas; (2) a description of how such networks 
will coordinate their planning efforts; and (3) a profile of 
each network.

    Such network profile is to identify (1) the mission of each 
medical facility, or proposed facility; (2) any planned change 
in any facility's mission and the rationale for the change; (3) 
data regarding the population of veterans served by the network 
and anticipated changes both in demographics and in health-care 
needs; (4) pertinent data by which to assess the progress made 
toward achieving relative equivalency in the availability of 
services per patient in each network; (5) opportunities for 
providing veterans services through contract arrangements; and 
(6) five-year construction plans for facilities in each 
network.

    The report required by section 8107, as amended, is also to 
include information with respect to each VA medical care 
facility regarding progress toward instituting identified, 
planned mission changes; implementing managed care; and 
establishing new services to provide veterans alternatives to 
institutional care.

    Section 201 would also amend section 8107 to require an 
annual report showing (1) the 20 most highly ranked major 
medical construction projects by category of project) and the 
relative rank and priority score for each; (2) a description of 
the specific factors that account for the project's ranking in 
relation to other projects within the same category; and (3) a 
description of the reasons for any change in the ranking from 
the last report.

    Section 202 would amend section 8104(b) to require 
specified additional information to be included in the 
prospectus for each proposed medical facility construction 
project.

    Section 203(a) would expand the definition of the term 
``major medical facility project'' in section 8104(a) of title 
38 in the case of a project principally devoted to altering a 
medical facility to provide additional space for providing 
ambulatory care, to mean a project involving a total 
expenditure of more than $5 million.

    Section 203(b) would, effective with fiscal year 1998 
appropriations, repeal a grandfather clause established in 
section 301(b) of Public Law 102-405.

    Section 203(c) would require VA to provide the Committees 
on Veterans' Affairs notice before it may obligate funds from 
the Advance Planning Fund in excess of $500,000, in the case of 
any one project, toward design or development of any major 
medical facility project.

    Section 204 would make technical changes in nomenclature in 
sections 8101 and 8109 of title 38, regarding elements of the 
construction process.

    Section 205(a) would delete the statutory requirement in 
section 7305 of title 38 that the Veterans Health 
Administration include specified clinical services, and would 
substitute language calling for an Office of the Under 
Secretary for Health and such professional auxiliary services 
as the Secretary deems necessary; the provision would require 
the Under Secretary to ensure that there is included in the 
Office of the Under Secretary appropriate staff expertise in 
generally specified specialized medical programs and 
appropriate clinical care disciplines.

    Section 205(b) would eliminate several of the provision of 
section 7306 of title 38 which require that the Office of the 
Under Secretary include certain specified positions.

    Section 301(a) would name the Department of Veterans 
Affairs Medical Center in Jackson, Mississippi as the ``G.V. 
Sonny Montgomery Department of Veterans Affairs Medical 
Center.''

    Section 301(b) specifies that such a name change shall take 
effect at noon on January 3, 1997, or the first day on which 
Representative Montgomery is no longer a Member of the House.

    Section 302(a) would name the Mountain Home Department of 
Veterans Affairs Medical Center in Johnson City, Tennessee as 
the ``James H. Quillen Department of Veterans Affairs Medical 
Center.''

    Section 302(b) specifies that such a name change shall take 
effect at noon on January 3, 1997, or the first day on which 
Representative Quillen is no longer a Member of the House.

    Section 303 would name the Department of Veterans Affairs 
Nursing Care Center in Aspinwall, Pennsylvania as the ``H. John 
Heinz, III Department of Veterans Affairs Nursing Care 
Center.''

    Section 304 would extend the VA's authority to establish 
Department of Veterans Affairs research corporations to 
December 31, 2000.

                           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, May 10, 1996.
Hon. Bob Stump,
Chairman, Committee on Veterans' Affairs,
House of Representatives, Washington, DC.
    Dear Mr. Chairman: The Congressional Budget Office (CBO) 
has reviewed H.R. 3376, a bill to authorize major medical 
facility projects and major medical facility leases for the 
Department of Veterans Affairs for fiscal year 1997, and for 
other purposes, as ordered reported by the House Committee on 
Veterans' Affairs on May 8, 1996.

    H.R. 3376 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 contains no intergovernmental or 
private-sector mandates as defined in Public Law 104-4, and 
would impose no direct costs on state, local, or tribal 
governments.

    If you wish further details on this estimate, we will be 
pleased to provide them.

            Sincerely,
                                           June E. O'Neill,
                                                          Director.

               Congressional Budget Office Cost Estimate

    1. Bill number: H.R. 3376

    2. Bill title: A bill to authorize major medical facility 
projects and major medical facility leases for the Department 
of Veterans Affairs (VA) for fiscal year 1997, and for other 
purposes.

    3. Bill status: As ordered reported by the House Committee 
on Veterans' Affairs on May 8, 1996.

    4. Bill purpose: The bill would authorize major 
construction projects and several major facility leases. It 
would also authorize appropriations for these projects and 
leases. In addition, the bill includes a number of provisions 
that would not have a significant budgetary impact.

    5. Estimated cost to the federal government:

    The following table summarizes the budgetary impact of H.R. 
3376, which would depend upon subsequent appropriations action.

                                                                                                                
                                    [By fiscal year, in millions of dollars]                                    
----------------------------------------------------------------------------------------------------------------
                                                     1996     1997     1998     1999     2000     2001     2002 
----------------------------------------------------------------------------------------------------------------
                                                                                                                
                                    SPENDING SUBJECT TO APPROPRIATIONS ACTION                                   
Spending Under Current Law:                                                                                     
  Budget Authority 1.............................      129        0        0        0        0        0        0
  Estimated Outlays..............................      418      350      235      123       44       11        3
Proposed Changes:                                                                                               
  Authorization Level 2..........................        0      435        0        0        0        0        0
  Estimated Outlays..............................        0        2       70      135      126       78       17
Spending Under H.R. 3376:                                                                                       
  Estimated Authorization Level1 2...............      129      435        0        0        0        0        0
  Estimated Outlays..............................      418      352      305      258      170       89       20
----------------------------------------------------------------------------------------------------------------
1 The 1996 figure is the amount already appropriated.                                                           
2 The amount for fiscal ear 1997 is an authorization subject to appropriations action.                          


    6. Basis of estimate: The estimate assumes enactment of the 
bill and appropriation of the authorized amounts. The bill 
would authorize the appropriation of $422 million for 21 major 
construction projects and $12 million for six major facility 
leases. CBO used historical spending rates for VA's major 
construction projects to estimate outlays.

    7. Pay-as-you-go considerations: The Balanced Budget and 
Emergency Deficit Control Act of 1985 sets up pay-as-you-go 
procedures for legislation affecting direct spending or 
receipts through 1998. This legislation would not affect direct 
spending or receipts. Therefore, it has no pay-as-you-go 
implications.

    8. Estimated cost to state, local, and tribal governments: 
H.R. 3376 contains no intergovernmental mandates as defined in 
Public Law 104-4 and would impose no direct costs on state, 
local, or tribal governments.

    9. Estimated impact on the private sector: This bill would 
impose no new federal private-sector mandates, as defined in 
Public Law 104-4.

    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 V--BOARDS, ADMINISTRATIONS, AND SERVICES

          * * * * * * *

 CHAPTER 73--VETERANS HEALTH ADMINISTRATION--ORGANIZATION AND FUNCTIONS

          * * * * * * *

                       SUBCHAPTER I--ORGANIZATION

          * * * * * * *

Sec. 7305. Divisions of Veterans Health Administration

  [The Veterans Health Administration shall include the 
following:
          [(1) The Office of the Under Secretary for Health.
          [(2) A Medical Service.
          [(3) A Dental Service.
          [(4) A Podiatric Service.
          [(5) An Optometric Service.
          [(6) A Nursing Service.
          [(7) Such other professional and auxiliary services 
        as the Secretary may find to be necessary to carry out 
        the functions of the Administration.]
  (a) The Veterans Health Administration shall include the 
Office of the Under Secretary for Health and such professional 
and auxiliary services as the Secretary may find to be 
necessary to carry out the functions of the Administration.
  (b) In organizing, and appointing persons to positions in, 
the Office, the Under Secretary shall ensure that the Office is 
staffed so as to provide the Under Secretary with appropriate 
expertise, including expertise in--
          (1) unique programs operated by the Administration to 
        provide for the specialized treatment and 
        rehabilitation of disabled veterans (including blind 
        rehabilitation, spinal cord dysfunction, mental 
        illness, and geriatrics and long-term care); and
          (2) appropriate clinical care disciplines.

Sec. 7306. Office of the Under Secretary for Health

  (a) The Office of the Under Secretary for Health shall 
consist of the following:
          (1) The Deputy Under Secretary for Health, who shall 
        be the principal assistant of the Under Secretary for 
        Health and who shall be a qualified doctor of medicine.
          (2) The Associate Deputy Under Secretary for Health, 
        who shall be an assistant to the Under Secretary for 
        Health and the Deputy Under Secretary for Health [and 
        who shall be a qualified doctor of medicine].
          * * * * * * *
          [(5) A Director of Nursing Service, who shall be a 
        qualified registered nurse and who shall be responsible 
        to the Under Secretary for Health for the operation of 
        the Nursing Service.
          [(6) A Director of Pharmacy Service, a Director of 
        Dietetic Service, a Director of Podiatric Service, and 
        a Director of Optometric Service, who shall be 
        responsible to the Under Secretary for Health for the 
        operation of their respective Services.
          [(7) Such directors of such other professional or 
        auxiliary services as may be appointed to suit the 
        needs of the Department, who shall be responsible to 
        the Under Secretary for Health for the operation of 
        their respective services.]
          [(8)] (5) The Director of the National Center for 
        Preventive Health, who shall be responsible to the 
        Under Secretary for Health for the operation of the 
        Center.
          [(9)] (6) Such other personnel as may be authorized 
        by this chapter.
  (b) Of the Assistant Under Secretaries for Health appointed 
under [subsection (a)(3)--
          [(1) not more than two may be] subsection (a)(3), not 
        more than two may be persons qualified in the 
        administration of health services who are not doctors 
        of medicine, dental surgery, or dental medicines[;].
          [(2) one shall be a qualified doctor of dental 
        surgery or dental medicine who shall be directly 
        responsible to the Under Secretary for Health for the 
        operation of the Dental Service; and
          [(3) one shall be a qualified physician trained in, 
        or having suitable extensive experience in, geriatrics 
        who shall be responsible to the Under Secretary for 
        Health for evaluating all research, educational, and 
        clinical health-care programs carried out in the 
        Administration in the field of geriatrics and who shall 
        serve as the principal advisor to the Under Secretary 
        for Health with respect to such programs.]
          * * * * * * *

                  SUBCHAPTER IV--RESEARCH CORPORATIONS

          * * * * * * *

Sec. 7368. Expiration of authority

  No corporation may be established under this subchapter after 
December 31, [1992] 2000.
          * * * * * * *

            PART VI--ACQUISITION AND DISPOSITION OF PROPERTY

          * * * * * * *

     SUBCHAPTER I--ACQUISITION AND OPERATION OF MEDICAL FACILITIES

          * * * * * * *

Sec. 8101. Definitions

  For the purposes of this subchapter:
  (1) The term ``alter'', with respect to a medical facility, 
means to repair, remodel, improve, or extend such medical 
facility.
  (2) The terms ``construct'' and ``alter'', with respect to a 
medical facility, include such engineering, architectural, 
legal, fiscal, and economic investigations and studies and such 
surveys, designs, plans, [working drawings] construction 
documents, specifications, procedures, and other similar 
actions as are necessary for the construction or alteration, as 
the case may be, of such medical facility and as are carried 
out after the completion of the advanced planning (including 
the development of project requirements and [preliminary plans] 
design development) for such facility.
          * * * * * * *

Sec. 8104. Congressional approval of certain medical facility 
                    acquisitions

  (a)(1) * * *
          * * * * * * *
  (3) For the purpose of this subsection:
          (A) The term ``major medical facility project'' means 
        a project for the construction, alteration, or 
        acquisition of a medical facility involving a total 
        expenditure of more than [$3,000,000] $5,000,000, but 
        such term does not include an acquisition by exchange.
  (b) In the event that the President or the Secretary proposes 
to the Congress the funding of any construction, alteration, 
lease, or other acquisition to which subsection (a) of this 
section is applicable, the Secretary shall submit to each 
committee, on the same day, a prospectus of the proposed 
medical facility. Such prospectus [shall include--] shall 
include the following:
          (1) [a detailed] A detailed description of the 
        medical facility to be constructed, altered, leased, or 
        otherwise acquired under this subchapter, including a 
        description of the location of such facility and, in 
        the case of a prospectus proposing the construction of 
        a new or replacement medical facility, a description of 
        the consideration that was given to acquiring an 
        existing facility by lease or purchase and to the 
        sharing of health-care resources with the Department of 
        Defense under section 8111 of this title[;].
          (2) [an estimate] An estimate of the cost to the 
        United States of the construction, alteration, lease, 
        or other acquisition of such facility (including site 
        costs, if applicable)[; and].
          (3) [an estimate] An estimate of the cost to the 
        United States of the equipment required for the 
        operation of such facility.
          (4) Demographic data applicable to the project, 
        including information on projected changes in the 
        population of veterans to be served by the project over 
        a five-year period and a ten-year period.
          (5) Current and projected workload and utilization 
        data.
          (6) Current and projected operating costs of the 
        facility, to include both recurring and non-recurring 
        costs.
          (7) The priority score assigned to the project under 
        the Department's prioritization methodology and, if the 
        project is being proposed for funding ahead of a 
        project with a higher score, a specific explanation of 
        the factors other than the priority that were 
        considered and the basis on which the project is 
        proposed for funding ahead of projects with higher 
        priority scores.
          (8) A listing of each alternative to construction of 
        the facility that has been considered.
          * * * * * * *
  (f) The Secretary may not obligate funds in an amount in 
excess of $500,000 from the Advance Planning Fund of the 
Department toward design or development of a major medical 
facility project until--
          (1) the Secretary submits to the committees a report 
        on the proposed obligation; and
          (2) a period of 30 days has passed after the date on 
        which the report is received by the committees.
          * * * * * * *

Sec. 8107. Operational and construction plans for medical facilities

  [(a)(1) In order to promote effective planning for the 
orderly construction, replacement, and alteration of medical 
facilities in accordance with the comparative urgency of the 
need for the services to be provided by such facilities, the 
Secretary, after considering the analysis and recommendations 
of the Under Secretary for Health, shall submit to each 
committee an annual report on the construction, replacement, 
alteration, and operation of medical facilities.
  [(2) Each such report shall contain--
          [(A) a five-year strategic plan for the operation and 
        construction of medical facilities--
                  [(i) setting forth--
                          [(I) the mission of each existing or 
                        proposed medical facility;
                          [(II) any planned change in such 
                        mission; and
                          [(III) the operational steps needed 
                        to achieve the facility's mission and 
                        the dates by which such steps are 
                        planned to be completed; and
                  [(ii) a five-year plan, based on the factors 
                set out in subclause (i) of this clause, for 
                construction, replacement, or alteration 
                projects for each such facility;
          [(B) a list, in order of priority, of not less than 
        10 hospitals that, in the judgment of the Secretary, 
        after considering the analysis and recommendations of 
        the Under Secretary for Health are most in need of 
        construction or replacement; and
          [(C) general plans (including projects costs, site 
        location, and, if appropriate, necessary land 
        acquisition) for each medical facility for which 
        construction, replacement, or alteration is planned 
        under clause (A)(ii) of this paragraph.
  [(3) The report under this subsection shall be submitted not 
later than June 30 of each year.]
  (a) In order to promote effective planning for the efficient 
provision of care to eligible veterans, the Secretary, based on 
the analysis and recommendations of the Under Secretary for 
Health, shall submit to each committee, not later than January 
31 of each year, a report regarding long-range health planning 
of the Department.
  (b) Each report under subsection (a) shall include the 
following:
          (1) A five-year strategic plan for the provision of 
        care under chapter 17 of this title to eligible 
        veterans through coordinated networks of medical 
        facilities operating within prescribed geographic 
        service-delivery areas, such plan to include provision 
        of services for the specialized treatment and 
        rehabilitative needs of disabled veterans (including 
        veterans with spinal cord dysfunction, blindness, 
        amputations, and mental illness) through distinct 
        programs or facilities of the Department dedicated to 
        the specialized needs of those veterans.
          (2) A description of how planning for the networks 
        will be coordinated.
          (3) A profile regarding each such network of medical 
        facilities which identifies--
                  (A) the mission of each existing or proposed 
                medical facility in the network;
                  (B) any planned change in the mission for any 
                such facility and the rationale for such 
                planned change;
                  (C) the population of veterans to be served 
                by the network and anticipated changes over a 
                five-year period and a ten-year period, 
                respectively, in that population and in the 
                health-care needs of that population;
                  (D) information relevant to assessing 
                progress toward the goal of achieving relative 
                equivalency in the level of resources per 
                patient distributed to each network, such 
                information to include the plans for and 
                progress toward lowering the cost of care-
                delivery in the network (by means such as 
                changes in the mix in the network of 
                physicians, nurses, physician assistants, and 
                advance practice nurses);
                  (E) the capacity of non-Federal facilities in 
                the network to provide acute, long-term, and 
                specialized treatment and rehabilitative 
                services (described in section 7305 of this 
                title), and determinations regarding the extent 
                to which services to be provided in each 
                service-delivery area and each facility in such 
                area should be provided directly through 
                facilities of the Department or through 
                contract or other arrangements, including 
                arrangements authorized under sections 8111 and 
                8153 of this title; and
                  (F) a five-year plan for construction, 
                replacement, or alteration projects in support 
                of the approved mission of each facility in the 
                network and a description of how those projects 
                will improve access to care, or quality of 
                care, for patients served in the network.
          (4) A status report for each facility on progress 
        toward--
                  (A) instituting planned mission changes 
                identified under paragraph (3)(B);
                  (B) implementing principles of managed care 
                of eligible veterans; and
                  (C) developing and instituting cost-effective 
                alternatives to provision of institutional 
                care.
  [(b)] (c) The Secretary shall submit to each committee not 
later than January 31 of each year a report showing the 
location, space, cost, and status of each medical facility (1) 
the construction, alteration, lease, or other acquisition of 
which has been approved under section 8104(a) of this title, 
and (2) which was uncompleted as of the date of the last 
preceding report made under this subsection.
  (d)(1) The Secretary shall submit to each committee, not 
later than January 31 of each year, a report showing the 
current priorities of the Department for proposed major medical 
construction projects. Each such report shall identify the 20 
projects, from within all the projects in the Department's 
inventory of proposed projects, that have the highest priority 
and, for those 20 projects, the relative priority and rank 
scoring of each such project. The 20 projects shall be 
compiled, and their relative rankings shall be shown, by 
category of project (including the categories of ambulatory 
care projects, nursing home care projects, and such other 
categories as the Secretary determines).
  (2) The Secretary shall include in each report, for each 
project listed, a description of the specific factors that 
account for the relative ranking of that project in relation to 
other projects within the same category.
  (3) In a case in which the relative ranking of a proposed 
project has changed since the last report under this subsection 
was submitted, the Secretary shall also include in the report a 
description of the reasons for the change in the ranking, 
including an explanation of any change in the scoring of the 
project under the Department's scoring system for proposed 
major medical construction projects.
          * * * * * * *

Sec. 8109. Parking facilities

  (a) * * *
          * * * * * * *
  (h)(1) * * *
          * * * * * * *
  (3)(A) * * *
  (B) Subparagraph (A) of this paragraph does not apply to the 
use of funds for investigations and studies, surveys, designs, 
plans, [working drawings] construction documents, 
specifications, and similar actions not directly involved in 
the physical construction of a structure.
          * * * * * * *
                              ----------                              


    SECTION 301 OF THE VETERANS' MEDICAL PROGRAMS AMENDMENTS OF 1992

SEC. 301. AUTHORIZATION REQUIREMENT FOR CONSTRUCTION OF NEW MEDICAL 
                    FACILITIES.

  (a) * * *
  [(b) Applicability.--The amendments made by subsection (a) 
shall not apply with respect to any project for which funds 
were appropriated before the date of the enactment of this 
Act.]

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