H. Rept. 105-833 - 105th Congress (1997-1998)
December 29, 1998, As Reported by the Veterans' Affairs Committee

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House Report 105-833 - HRPT105-833




[House Report 105-833]
[From the U.S. Government Printing Office]




                                                 Union Calendar No. 474

105th Congress, 2d Session - - - - - - - - - - - - House Report 105-833
-----------------------------------------------------------------------


                           ACTIVITIES REPORT



                                of the



                    COMMITTEE ON VETERANS' AFFAIRS


                       HOUSE OF REPRESENTATIVES



                      ONE HUNDRED FIFTH CONGRESS

                               __________

                             FIRST SESSION

                        Convened January 7, 1997

                      Adjourned November 13, 1997

                             SECOND SESSION

                       Convened January 27, 1998

                      Adjourned December 19, 1998


                                     
<GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT>



December 29, 1998--Committed to the Committee of the Whole House on the 
              State of the Union and ordered to be printed

                               --------

                    U.S. GOVERNMENT PRINTING OFFICE                    
*69-006                     WASHINGTON : 1998





                     COMMITTEE ON VETERANS' AFFAIRS

                      BOB STUMP, Arizona, Chairman

CHRISTOPHER H. SMITH, New Jersey     LANE EVANS, Illinois
MICHAEL BILIRAKIS, Florida           JOSEPH P. KENNEDY II, 
FLOYD SPENCE, South Carolina         Massachusetts
TERRY EVERETT, Alabama               BOB FILNER, California
STEVE BUYER, Indiana                 LUIS V. GUTIERREZ, Illinois
JACK QUINN, New York                 JAMES E. CLYBURN, South Carolina
SPENCER BACHUS, Alabama              CORRINE BROWN, Florida
CLIFF STEARNS, Florida               MICHAEL F. DOYLE, Pennsylvania
DAN SCHAEFER, Colorado               FRANK MASCARA, Pennsylvania
JERRY MORAN, Kansas                  COLLIN C. PETERSON, Minnesota
JOHN COOKSEY, Louisiana              JULIA CARSON, Indiana
ASA HUTCHINSON, Arkansas             SILVESTRE REYES, Texas
J.D. HAYWORTH, Arizona               VIC SNYDER, Arkansas
HELEN CHENOWETH, Idaho               CIRO D. RODRIGUEZ, Texas
RAY LaHOOD, Illinois
BILL REDMOND, New Mexico

          Carl D. Commenator, Chief Counsel and Staff Director

                               __________

                         SUBCOMMITTEE ON HEALTH

                    CLIFF STEARNS, Florida, Chairman

CHRISTOPHER H. SMITH, New Jersey     LUIS V. GUTIERREZ, Illinois
MICHAEL BILIRAKIS, Florida           JOSEPH P. KENNEDY II, 
SPENCER BACHUS, Alabama              Massachusetts
JERRY MORAN, Kansas                  CORRINE BROWN, Florida
JOHN COOKSEY, Louisiana              MICHAEL F. DOYLE, Pennsylvania
ASA HUTCHINSON, Arkansas             COLLIN C. PETERSON, Minnesota
HELEN CHENOWETH, Idaho               JULIA CARSON, Indiana
                               __________

                        SUBCOMMITTEE ON BENEFITS

                     JACK QUINN, New York, Chairman

DAN SCHAEFER, Colorado               BOB FILNER, California
J.D. HAYWORTH, Arizona               FRANK MASCARA, Pennsylvania
RAY LaHOOD, Illinois                 SILVESTRE REYES, Texas
BILL REDMOND, New Mexico             CIRO D. RODRIGUEZ, Texas
                               __________

              SUBCOMMITTEE ON OVERSIGHT AND INVESTIGATIONS

                    TERRY EVERETT, Alabama, Chairman

BOB STUMP, Arizona                   JAMES E. CLYBURN, South Carolina
FLOYD SPENCE, South Carolina         VIC SNYDER, Arkansas
STEVE BUYER, Indiana                 FRANK MASCARA, Pennsylvania

                                  (ii)

  


                                     

                            Committee Staff

          Carl D. Commenator, Chief Counsel and Staff Director

                 Patrick E. Ryan, Deputy Chief Counsel

Kingston E. Smith, General Counsel and Staff Director, Subcommittee on 
                      Oversight and Investigations

                    Daniel G. Amon, Press Secretary

         Jill T. Cochran, Democratic Professional Staff Member

             Charles M. Durishin, Democratic Staff Director

  Susan C. Edgerton, Democratic Staff Director, Subcommittee on Health

      Sally A. Elliott, Staff Assistant, Subcommittee on Benefits

         Ralph J. Ibson, Staff Director, Subcommittee on Health

      Angela L. Jeansonne, Staff Assistant, Subcommittee on Health

       Darryl W. Kehrer, Staff Director, Subcommittee on Benefits

 Elizabeth A. Kilker, Democratic Executive Assistant, Subcommittee on 
                                Benefits

             Eric J. Klos, Director of Information Services

 Alicemary O. Leach, Investigative Counsel, Subcommittee on Oversight 
                           and Investigations

       Mary Ellen Mc Carthy, Democratic Professional Staff Member

 Sandra K. McClellan, Democratic Executive Assistant, Subcommittee on 
                                 Health

     Mary Stevens McDermott, Administrative and Financial Assistant

  Kristine K. McElroy, Staff Assistant, Subcommittee on Oversight and 
                             Investigations

 Paige E. McManus, Professional Staff Member, Subcommittee on Benefits

               Jeanne M. McNally, Legislative Coordinator

       Thomas A. O'Donnell, Democratic Professional Staff Member

   John P. Roerty, Professional Staff Member, Subcommittee on Health

    Deborah A. Smith, Democratic Administrative Assistant/Executive 
          Assistant, Subcommittee Oversight and Investigations

                    Jeremiah B. Tan, Printing Clerk

                 Patricia Lee Tippett, Staff Assistant

Arthur K. Wu, Professional Staff Member, Subcommittee on Oversight and 
                             Investigations

                                 (iii)



                          LETTER OF SUBMITTAL

                              ----------                              

                          House of Representatives,
                            Committee on Veterans' Affairs,
                                  Washington, DC, December 29, 1998

Hon. Robin H. Carle,
Clerk, House of Representatives,
Washington, D.C.

    Dear Ms. Carle: In accordance with Clause 1(d) of Rule XI 
of the Rules of the House of Representatives, I submit herewith 
the report of the Committee on Veterans' Affairs setting forth 
its activities in reviewing and studying the application, 
administration, and execution of those laws, the subject matter 
of which is within the jurisdiction of our committee.

                                                 Bob Stump,
                                                           Chairman

                                FOREWORD

                              ----------                              

    The 105th Congress saw significant improvements to veterans 
benefits for our nation's 25 million veterans. In order to 
provide greater assistance to veterans and their families, 
programs providing health care, compensation, education, 
employment assistance, life insurance, and burial honors were 
enhanced during the 105th Congress. In addition, new employee 
assistance programs were created. Congress approved funding for 
a number of construction projects to renovate and modernize 
aging VA facilities that are expected to serve veterans for the 
first half of the 21st century.
    These enhancements were overshadowed at times by 
controversy surrounding the adoption of the Administration's 
proposal to stop paying disability compensation to veterans 
with diseases related to tobacco use. Controversy also resulted 
from the failure of the Senate to take up many of the bills 
passed by the House during the second session, and from the 
Senate's insistence on including authorizing legislation 
pertaining to veterans in the Omnibus Consolidated 
Appropriations measure (Public Law 105-277). This occurred 
notwithstanding a compromise agreement on this legislation 
reached by the House and Senate Committees on Veterans' Affairs 
and included as part of the final amendments to H.R. 4110 that 
are described below.
    During the 105th Congress, proposals were enacted into law 
to:

          
 Provide two cost-of-living adjustments, 
        effective December 1 of 1997 and 1998, for the rates of 
        veterans' compensation for service-connected disability 
        and the rates of dependency and indemnity compensation 
        for survivors of certain disabled veterans.
          
 Authorize the National Academy of Sciences 
        (NAS) to review and evaluate the available scientific 
        evidence and determine whether there is scientific 
        evidence of an association between illnesses 
        experienced by Gulf War veterans and service in the 
        Persian Gulf War.
          
 Extend VA's special authority to provide 
        care to Persian Gulf veterans through December 31, 
        2001.
          
 Establish authority for VA to provide 
        priority health care to treat illnesses that may be 
        attributable to a veteran's service in combat during 
        any period of war after the Persian Gulf War or during 
        any other future period of hostilities.
          
 Require VA to enter into an agreement with 
        the National Academy of Sciences or another appropriate 
        independent organization to assist in developing a plan 
        for the establishment of a national center for the 
        study of war-related illnesses and post-deployment 
        health issues.
          
 Extend VA's authority to evaluate the health 
        status of spouses and children of Persian Gulf War 
        veterans through December 31, 1999, and to provide such 
        examinations through VA facilities, or under its fee-
        basis or other contract arrangements.
          
 Improve access to veterans education 
        programs by requiring the VA and military service 
        branches to expand outreach services concerning VA 
        education program requirements to members of the armed 
        services.
          
 Improve employment opportunities for persons 
        in the National Guard and Reserve by clarifying the 
        enforcement of veterans' employment and reemployment 
        rights with respect to a State as an employer, and 
        extending those rights to former members of the 
        uniformed services and reservists employed abroad by 
        U.S. companies.
          
 Increase the special pension provided to 
        persons entered and recorded on the Army, Navy, Air 
        Force, and Coast Guard Medal of Honor Roll from $400 to 
        $600 per month.
          
 Extend eligibility for burial in National 
        Cemeteries and funeral benefits to persons who served 
        in the Merchant Marine from August 16, 1945, to 
        December 31, 1946.
          
 Modify the existing State Cemetery Grants 
        Program to authorize VA to pay up to 100 percent of the 
        cost of constructing and equipping state veterans' 
        cemeteries.
          
 Authorize the Secretary of Veterans Affairs 
        to guarantee loans to provide multifamily transitional 
        housing for homeless veterans.
          
 Extend the VA's authority to guarantee home 
        loans for members of the National Guard and Reserve 
        components to September 30, 2003. The current program 
        expires in 1999.
          
 Authorize appropriations for fiscal years 
        1999 and 2000 in the amount of $241.1 million for the 
        Construction, Major Projects account and $8.5 million 
        for the Medical Care account for major medical leases.
          
 Authorize VA to carry out an employee-
        incentive scholarship program and an education debt 
        reduction program through December 31, 2001, to assist 
        in meeting the staffing needs for health professional 
        positions for which it is difficult to recruit or 
        retain qualified personnel.
          
 Authorize VA to provide priority health care 
        for the treatment of cancer of the head or neck to 
        veterans who can document nasopharyngeal radium 
        irradiation treatment in service.
          
 Extend VA's authority through December 31, 
        2001, to counsel and treat veterans for sexual trauma 
        experienced during military service.

    Further, the Veterans Benefits Act of 1998, Title VIII, 
H.R. 2400 (Public Law No. 105-178), effective October 1, 1998, 
is one of the largest expansions of veterans benefits since the 
Persian Gulf War and totals $1.6 billion over five years. It is 
projected to assist over 500,000 veterans and their survivors 
in the first year. It contains provisions to:

          
 Increase the basic full time GI Bill 
        education rate by 20 percent from $440 per month to 
        $528 per month. This increases benefits by $860 million 
        over 5 years and improves benefits for about 386,300 
        veterans and active duty service members during the 
        first year.
          
 Increase education benefits by 20 percent 
        for spouses and children of those service members 
        killed on active duty, who die of a service-connected 
        cause, or are totally service-connected disabled. This 
        increases benefits by $105 million over five years and 
        assists over 41,000 dependents in the first year.
          
 Allow all surviving spouses of veterans who 
        die from a service-connected disability to resume 
        receiving assistance under the VA's Dependency and 
        Indemnity Compensation (DIC) program if their 
        subsequent remarriage ends, thus repealing a 1990 
        change in law. This increases benefits by $433 million 
        over 5 years and about 6,000 veterans' survivors are 
        eligible for reinstatement of DIC benefits.
          
 Increase adaptive housing grants for 
        severely disabled veterans from $38,000 to $43,000, so 
        that veterans may purchase a home specially adapted to 
        their needs or make modifications to their current 
        residence. This increases benefits by $10 million over 
        5 years and improves benefits for about 855 veterans in 
        the first year.
          
 Increase the adaptive automobile allowance 
        for severely disabled veterans from $5,500 to $8,000 to 
        help with the rising cost of automobiles. This 
        increases benefits by $10 million over 5 years and 
        improves benefits for about 4,300 veterans over that 
        period.
          
 Increase the monthly pension benefit for 
        disabled veterans in need of the full time aid and 
        attendance of another person by $600 per year to assist 
        the increasing number of low-income veterans who need 
        alternatives to nursing home care. This increases 
        benefits by $200 million over 5 years and improves 
        benefits for about 62,000 veterans in the first year.
          
 Reduce the amount which the VA must recoup 
        before paying disability benefits to veterans who also 
        qualified for separation bonuses when separating from 
        the military between 1991 and 1996. This increases 
        benefits by $4 million over 5 years and affects about 
        90,000 veterans who paid taxes on Special Separation 
        Bonuses.
          
 Adopt the Administration's proposal 
        restricting the Secretary of Veterans Affairs' 
        authority to provide compensation or other service-
        connected benefits for diseases or disabilities 
        attributable to a veteran's use of tobacco. Exceptions 
        can be made for diseases incurred while on active duty 
        or within one year of separation from active duty. This 
        specifies that VA may grant benefits to veterans who 
        may be entitled to a presumption that a disease or 
        disability is related to other in-service exposures 
        (such as Agent Orange, radiation, or diseases 
        associated with being a prisoner of war).

    The Committee did not formally consider these provisions, 
which were agreed to by the White House and House and Senate 
leaders who negotiated the Transportation Equity Act for the 
21st Century, H.R. 2400. Because of drafting errors contained 
in this bill, provisions in the Internal Revenue Service 
Restructuring and Reform Act of 1998, Public Law 105-206, 
modified the original section 8202 of the Veterans Benefits Act 
of 1998.
    The Committee stepped up its oversight and investigative 
activities during the 105th Congress by reestablishing the 
Subcommittee on Oversight and Investigations. The Committee did 
not have such a subcommittee during the 104th Congress, but had 
one during the 103rd Congress. In addition to accomplishing 
much of its planned agenda despite limited resources, the 
subcommittee conducted major investigations on two matters 
which arose in 1997--sexual harassment in the VA and burial 
waivers at Arlington National Cemetery. The subcommittee also 
provided oversight of the VA's first strategic and performance 
plans under the requirements of the Government Performance and 
Results Act of 1993.
    Funding for veterans' programs is always a matter of 
particular interest. For fiscal year 1999, the VA-HUD 
Appropriations Act of 1999 (Public Law No. 105-276) adds $439 
million to amounts requested by the President for the 
Department of Veterans Affairs for fiscal year 1999. Total 
funding for VA medical care is $17.8 billion, $251 million 
above the President's request. This consists of an 
appropriation of $17.3 billion and authority to spend 
collections projected to total $577 million. VA medical 
research is funded at $316 million ($16 million above 
Administration), construction of VA facilities is funded at 
$317 million ($79 million above Administration), and grants for 
state veteran home construction are funded at $90 million ($53 
million above Administration). The Veterans Benefits 
Administration is funded at $812 million ($6 million above the 
President's request and $58 million above last year's level). 
All other accounts are funded at the level requested by the 
President or slightly higher. The total appropriation is 
$42.653 billion.
    I wish to thank the Honorable Lane Evans, the Ranking 
Minority Member, for his dedication to veterans and his work on 
the issues considered by the Committee during the 105th 
Congress. Mr. Evans has been a member of the committee since 
1985 and is widely regarded as an outstanding veterans' 
advocate. He has demonstrated his leadership capacity during 
his first Congress as the Ranking Minority member, and 
continued the VA Committee's long tradition of dealing with 
veterans' issues in a bipartisan manner.
    I also greatly appreciate the diligence of all the 
subcommittee chairmen and ranking minority members in holding 
the many hearings and markups so necessary to the 
accomplishment of the Committee's oversight and legislative 
agendas for veterans. They are the Honorable Cliff Stearns, 
Chairman of the Subcommittee on Health, and the Honorable Luis 
Gutierrez, the Subcommittee's Ranking Minority Member; the 
Honorable Jack Quinn, Chairman of the Subcommittee on Benefits, 
and the Honorable Bob Filner, the Subcommittee's Ranking 
Minority Member; and the Honorable Terry Everett, Chairman of 
the Subcommittee on Oversight and Investigations, and the 
Ranking Minority Member, the Honorable James Clyburn.
    The House and Senate Veterans' Affairs Committees have 
continued their cooperative relationship during the 105th 
Congress, always keeping the needs of our nation's veterans in 
the forefront. What differences have arisen were resolved 
through a constructive process of compromise which I believe 
resulted in the most beneficial legislation possible for 
veterans. I particularly acknowledge the leadership of the 
Honorable Arlen Specter, Chairman of the Senate Committee. 
Also, I extend thanks to the Honorable John D. Rockefeller, the 
Ranking Minority Member of the Senate Committee, for his hard 
work on our veterans' legislation and I look forward to a 
continuation of our efforts on behalf of veterans.
    For those members of this Committee who will be leaving 
their assignments here at the end of this Congress, I commend 
their faithful and dedicated service to veterans. They are: 
Honorable James E. Clyburn, Honorable John Cooksey, Honorable 
Asa Hutchinson, Honorable Joseph P. Kennedy II, Honorable Ray 
La Hood, Honorable Bill Redmond, and Honorable Dan Schaefer.
    Finally, I thank the staff of the Committee on Veterans' 
Affairs and its Subcommittees for their constancy and attention 
to the daily tasks of committee business. Together with our 
Committee members and our Senate colleagues, their work on our 
legislative and oversight agendas was invaluable to the 
Committee's success in reaching its objectives for veterans.

                                                 Bob Stump,
                                                           Chairman


                            C O N T E N T S

                              ----------                              
                                                                   Page
Jurisdiction of the House Committee on Veterans' Affairs.........     1
Activities under jurisdiction of the committee as administered 
  by:
    The Department of Veterans Affairs...........................     2
          Medical care...........................................     2
          Medical research.......................................     3
          Compensation and pension...............................     4
          Insurance..............................................     4
          National cemeteries....................................     4
          Education..............................................     5
          Home loan assistance...................................     5
          Employees..............................................     6
          History of the Department of Veterans Affairs..........     6
    The Department of Labor......................................     7
    The American Battle Monuments Commission.....................     7
Messages from the President and other Executive Branch 
  communications.................................................     8
Summary of action by the Committee on Veterans' Affairs..........    20
Hearings and Executive Sessions..................................    21
Legislation enacted into law:
    Public Law 105-67............................................    27
    Public Law 105-98............................................    27
    Public Law 105-111...........................................    31
    Public Law 105-114...........................................    32
    Public Law 105-116...........................................    35
    Public Law 105-368...........................................    36
Activities of the subcommittees:
    Subcommittee on Health.......................................    42
    Subcommittee on Benefits.....................................    51
    Subcommittee on Oversight and Investigations.................    60
Committee web site...............................................    70
Oversight Plan for the 105th Congress............................    71
    Subcommittee on Health.......................................    71
    Subcommittee on Benefits.....................................    74
    Subcommittee on Oversight and Investigations.................    77
Report on the budget for fiscal year 1998........................    81
Report on the budget for fiscal year 1999........................    98
Statistical data--war veterans and dependents....................   121
                                     



                                                 Union Calendar No. 474

105th Congress                                                   Report
  2d Session            HOUSE OF REPRESENTATIVES                105-833

=======================================================================



 
ACTIVITIES OF THE COMMITTEE ON VETERANS' AFFAIRS FOR THE 105TH CONGRESS

                                _______
                                

December 29, 1998--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, pursuant to Clause 
                1(d) of Rule XI, submitted the following

                              R E P O R T

                              Jurisdiction

    Rule X of the Rules of the House of Representatives 
establishes the standing committees of the House and their 
jurisdiction. Under that rule, all bills, resolutions, and 
other matters relating to the subjects within the jurisdiction 
of any standing committee shall be referred to such committee. 
Clause 1(r) of Rule X establishes the jurisdiction of the 
Committee on Veterans' Affairs as follows:

          (1) Veterans' measures generally.
          (2) Cemeteries of the United States in which veterans 
        of any war or conflict are or may be buried, whether in 
        the United States or abroad, except cemeteries 
        administered by the Secretary of the Interior.
          (3) Compensation, vocational rehabilitation, and 
        education of veterans.
          (4) Life insurance issued by the government on 
        account of service in the armed forces.
          (5) Pensions of all the wars of the United States, 
        general and special.
          (6) Readjustment of servicemen to civil life.
          (7) Soldiers' and sailors' civil relief.
          (8) Veterans' hospitals, medical care, and treatment 
        of veterans.
    This committee was established January 2, 1947, as a part 
of the Legislative Reorganization Act of 1946 (60 Stat. 812), 
and was vested with jurisdiction formerly exercised by the 
Committee on World War Veterans' Legislation, Invalid Pensions, 
and Pensions. Jurisdiction over veterans' cemeteries 
administered by the Department of Defense was transferred from 
the Committee on Interior and Insular Affairs on October 20, 
1967, by H. Res. 241, 90th Congress.

                     DEPARTMENT OF VETERANS AFFAIRS

    The U.S. Department of Veterans Affairs was established 
March 15, 1989, with Cabinet rank, succeeding the Veterans 
Administration (VA), and assumed responsibility for the mission 
of providing federal benefits to veterans and their dependents. 
In its first five-year strategic plan issued September 30, 
1997, under the requirements of the Government Performance and 
Results Act of 1993, the VA as part of its vision for the 
future stated:

          The Department will continue to honor, care, and 
        compensate veterans in recognition of their sacrifices 
        for America, shifting its emphasis from a process-
        focused system to a strategically-driven, performance-
        based, outcome-oriented delivery system. VA will 
        provide seamless service to veterans by integrating 
        disparate Department activities and functions.
          We will foster greater integration and partnerships 
        with other government and private organizations whose 
        functions complement our own.

    Headed by the Secretary of Veterans Affairs, VA is the 
second largest of the 14 cabinet departments. VA nationwide 
carries out its mission with health care programs through the 
Veterans Health Administration; compensation, pension, 
vocational rehabilitation, education assistance, home loan 
guaranty and insurance programs through the Veterans Benefits 
Administration; and a cemetery program through the National 
Cemetery Administration. A Board of Veterans' Appeals provides 
final decisions for the Secretary on appeals for entitlement to 
VA benefits.
    The present veteran population is estimated at more than 25 
million, as of July 1, 1997. About 80 of every 100 living 
veterans served during defined periods of armed hostilities. 
Altogether, more than one-fourth of the nation's population--
approximately 70 million veterans, dependents and survivors of 
deceased veterans--is potentially eligible for VA benefits and 
services.

                              Medical Care

    The largest and most visible component of the Department of 
Veterans Affairs is its health care system. The system grew 
from 54 hospitals in 1930, when the Veterans Administration was 
established, to 171 today. VA operates at least one medical 
center in each of the 48 contiguous states, Puerto Rico, and 
the District of Columbia; however, a concerted effort has been 
made to move away from the ``bricks and mortar'' approach to 
health care. Accordingly, only one new VA hospital--in West 
Palm Beach, Florida--has been constructed in the recent past. 
Efforts to streamline provision of care and to revise facility 
missions, where indicated, have led to consolidation and 
``merger'' of a number of medical centers in close proximity to 
one another.
    In 1997, with 26,200 medical center beds VA treated 634,800 
patients in VA hospitals, 47,000 in nursing home care units, 
and 23,900 in domiciliary facilities. VA's outpatient clinics 
register approximately 35 million visits per year. An estimated 
3.3 million individual veterans receive care annually.
    VA currently is affiliated with 107 medical schools, 53 
dental schools, and 1,200 other schools across the nation. More 
than one-half of all practicing physicians in the United States 
received part of their professional education in the VA health 
care system. Each year, approximately 90,274 health care 
professionals receive training in VA medical centers.
    Since 1979, VA has operated Vietnam Veteran Outreach 
Centers (Vet Centers), which provide readjustment counseling 
services to Vietnam-era veterans. With the advent of the 
Persian Gulf War, eligibility for Vet Center counseling was 
expanded to include those veterans as well as veterans who 
served during other periods of armed hostilities following the 
Vietnam era--Lebanon, Grenada and Panama. Additionally, Public 
Law 104-262 expands eligibility for Vet Center counseling to 
combat veterans of conflicts prior to the Vietnam era. However, 
Public Law 104-262 also places a deadline on non-theater 
Vietnam-era veterans to seek VA readjustment counseling by 
January 1, 2000.
    Currently, there are 206 Vet Centers nationwide. 
Approximately 1.47 million veterans have visited Vet Centers 
since the program began. Counseling is provided for a variety 
of reasons, including employment problems, marital 
difficulties, and post-traumatic stress disorder (PTSD). VA 
also conducts a variety of special programs including 
compensated work therapy to provide veterans with job skills 
and training and rehabilitative residencies to assist homeless 
veterans. Both alcohol and drug abuse rehabilitation and PTSD 
outreach programs were expanded in recent years.
    VA, in operating its health care facilities, benefits from 
the contributions of time and energy of volunteers from all 
walks of life. More than 106,700 volunteers through VA's 
Voluntary Service donate more than 13.4 million hours of 
service each year to bring companionship and additional care to 
hospitalized veterans.

                            Medical Research

    In concert with operating a nationwide health-care delivery 
system, VA carries out an extensive array of research targeted 
to the special needs of veterans but relevant as well to 
medicine generally. Among its major targets are research into 
aging, chronic diseases, mental illness, substance abuse, 
sensory loss, and trauma-related illness. Its research programs 
are nationally recognized and have made important contributions 
in virtually every area of medicine.
    VA researchers played key roles in improving artificial 
limbs and eradicating tuberculosis, and in developing the 
cardiac pacemaker, the CT scanner, and magnetic resonance 
imaging, which permits safe removal of brain tumors. The first 
kidney transplant in the United States was performed at a VA 
medical facility, and VA researchers pioneered the first 
successful drug treatments for high blood pressure and 
schizophrenia. The ``Seattle Foot'' was created by VA to give 
amputees the push-off needed to run and jump, as well as walk. 
VA contributions to medical knowledge have won VA scientists 
many prestigious awards, including the Nobel Prize.
    Recent advances by VA researchers showed that prostate 
cancer can now be treated with laser surgery, which is faster, 
less painful and more cost-efficient. In treating high blood 
pressure, doctors are now able to choose the most beneficial 
treatments based on patient characteristics such as age and 
race. VA researchers also showed that low doses of the drug 
warfarin reduce the risk of stroke by 79 percent with an 
accuracy rate of from 80 to 90 percent. Through ``compassionate 
use'' drug trials, veterans with AIDS had access to 
investigational drugs before they became available to the 
public for clinical use.
    Early research by VA with animals gives hope that spinal 
cord regeneration may be possible after paralysis. Rheumatoid 
arthritis, an autoimmune disease, can be genetically cured in 
mice; this is the first step toward a treatment in humans. VA 
researchers also found the substance responsible for the 
breakdown of bones in osteoporosis. In cancer research, VA 
researchers are developing new ``suicide genes'' that would 
seek out cancerous cells and identify them so that drugs would 
affect cancer cells but not healthy ones.
    Research topics identified as the result of the Vietnam 
experience such as PTSD and the health effects of Agent Orange 
exposure are continuing, with new topics relating to the 
Persian Gulf War.

                        Compensation and Pension

    More than 2.6 million veterans receive disability 
compensation or pension payments for the VA. Some 633,035 
widows, children and parents of deceased veterans are being 
paid survivor compensation or death pension benefits. VA 
disability and death compensation and pension payments were 
more than $19 billion for fiscal year 1997.

                               Insurance

    VA operates one of the largest life insurance programs in 
the world and the fourth largest in the United States. VA 
administers seven life insurance programs under which 2.4 
million policies with a value of $23.4 billion remained in 
force at the end of fiscal year 1998. In addition, VA 
supervises the Servicemembers' Group Life Insurance and 
Veterans' Group Life Insurance programs, which provide some 
$481 billion in insurance coverage to approximately 2.8 million 
veterans and members of the uniformed services. The 1999 GI 
life insurance dividend will return almost $752 million to more 
than 1.9 million policyholders.

                          National Cemeteries

    Since 1973, when VA assumed responsibility for the National 
Cemetery Administration (NCA), 13 new cemeteries have been 
established. Today the system is comprised of 115 cemeteries in 
39 states and Puerto Rico. Of these 57 have unassigned grave 
sites for complete interments (those which include a casket). 
Additionally, NCA oversees 34 soldiers' lots, monument sites 
and confederate cemeteries.
    VA is continuing to actively pursue the development of new 
cemeteries in those metropolitan areas that are presently not 
served by a national cemetery. The most recent new cemetery is 
the Tahoma National Cemetery in the Seattle/Tacoma, Washington, 
area which opened in October 1997. In addition, VA is in the 
process of developing four other national cemeteries: Saratoga 
National Cemetery near Albany New York; Abraham Lincoln 
National Cemetery near Chicago, Illinois; Dallas/Fort Worth 
National Cemetery to serve veterans in north and central Texas; 
and a yet-to-be named cemetery in northeastern Ohio to provide 
burial space for the veterans of the Cleveland area. The 
opening of these five new VA cemeteries within three years 
(1997-2000) would be unprecedented since the Civil War.
    Since July 30, 1973, total acreage in the National Cemetery 
Administration has increased from 4,139 to the present 13,611.7 
acres. Interments are expected to increase from 76,718 in 
fiscal year 1998 to more than 111,000 in 2008.
    In fiscal year 1998, VA provided 346,034 headstones or 
markers to mark the graves of veterans buried in private, state 
veterans, military/post, and national cemeteries.

                               Education

    Since 1944, when the first GI Bill became law, more than 20 
million beneficiaries have participated in GI Bill education 
and training programs. This includes 7.8 million World War II 
veterans, 2.3 million Korean War veterans, and 8.2 million post 
Korean and Vietnam era veterans, and active duty personnel.
    Proportionally, Vietnam era veterans were the greatest 
participants in GI Bill training. Approximately 76 percent of 
those eligible took training, compared with 50.5 percent for 
World War II veterans and 43.4 percent for Korean era veterans.
    The All-Volunteer Force Educational Assistance Program 
provides benefits for veterans, service personnel and members 
of the Selected Reserve who train under the Montgomery GI Bill. 
In fiscal year 1998, 294,800 veterans, 15,408 service personnel 
and 74,000 reservists received those benefits. Since the 
enactment of the Servicemen's Readjustment Act of 1944, the 
cost of educational benefits has totaled more than $73 billion.

                          Home Loan Assistance

    VA's loan guarantee program has benefited more than 15 
million veterans and their dependents. From this program's 
establishment as part of the original GI Bill in 1944 through 
the end of fiscal year 1997, VA home loan guarantees totaled 
more than $597 billion. In 1998, VA guaranteed 343,954 loans 
valued at $37.9 billion and assisted 477 disabled veterans with 
grants totaling more than $15.8 million for specially adapted 
housing.

                Department of Veterans Affairs Employees

    As of October 31, 1998, VA had 238,569 employees. Among all 
the departments and agencies of the federal government, only 
the Department of Defense has a larger work force. Of the total 
number of VA employees, 218,730 work in the Veterans Health 
Administration, 11,470 are employed in the Veterans Benefits 
Administration, 1,325 are within the National Cemetery System, 
and 3,404 work in the Veterans Canteen Service. The remaining 
3,540 employees are in various staff offices. The Department is 
a leader in hiring veterans. Approximately 25 percent of all 
employees are veterans.

           History of the Department of Veterans Affairs (VA)

1930--The Veterans Administration was created by Executive 
        Order 5398, signed by President Herbert Hoover on July 
        21, 1930. At the time, there were 54 hospitals, 4.7 
        million living veterans, and 31,600 VA employees.
1933--The Board of Veterans' Appeals was established.
1944--On June 22, President Roosevelt Franklin Roosevelt signed 
        the ``Servicemen's Readjustment Act of 1944'' (Public 
        Law 346, passed unanimously by the 78th Congress).
1946--The Department of Medicine & Surgery was established, 
        succeeded in 1989 by the Veterans Health Services and 
        Research Administration, renamed the Veterans Health 
        Administration in 1991.
1953--The Department of Veterans Benefits was established, 
        succeeded in 1989 by the Veterans Benefits 
        Administration.
1973--The National Cemetery System (except for Arlington 
        National Cemetery) was transferred by the Army to VA.
1988--Legislation to elevate VA to Cabinet status was signed by 
        President Ronald Reagan.
1989--On March 15, VA became the 14th Department in the 
        President's Cabinet.

           Secretaries of the Department of Veterans Affairs           

Togo D. West, Jr.                                        1998--present
Jesse Brown                                              1993--1997
Edward J. Derwinsk                                       1989-1992


             Administrators of the Veterans Administration             

Thomas K. Turnage                                        1986-1989
Harry N. Walters                                         1982-1986
Robert P. Nimmo                                          1981-1982
Max Cleland                                              1977-1981
Richard L. Roudebush                                     1974-1977
Donald E. Johnson                                        1969-1974
William J. Driver                                        1965-1969
John S. Gleason                                          1961-1964
Sumner G. Whittier                                       1957-1961
Harvey V. Higley                                         1953-1957
Carl N. Gray                                             1948-1953
Omar N. Bradley                                          1945-1947
Frank T. Hines                                           1930-1945


                          DEPARTMENT OF LABOR

               Veterans' Employment and Training Service

    The Department of Labor (DOL) engages in a variety of 
activities to assist veterans obtain a job or the training and 
other employment development services they need to become 
employable. In accordance with Chapter 41 of title 38, United 
States Code, the highest priority is given to disabled veterans 
and veterans of the Vietnam era.
    The Assistant Secretary for Veterans' Employment and 
Training (ASVET) is the principal advisor to the Secretary of 
Labor regarding DOL policies and programs to meet the 
employment and training needs of veterans, to protect the 
reemployment rights of protected individuals in the uniformed 
services, and to facilitate the transition of military 
servicemembers to the civilian work force. The Office of the 
ASVET, through the Veterans' Employment and Training Service 
(VETS), administers grants to States and local government 
entities primarily to support veterans' employment specialist 
staffing, provides reemployment rights complaint investigation 
and mediation services, formulates and implements interagency 
agreements to ensure the seamless provision of services to 
veterans, provides technical assistance and training to 
veterans services providers' staff, monitors the performance of 
state job service agencies for veterans, conducts pilot 
projects to develop and test new approaches to serving 
veterans, and conducts pilot projects for veterans' hiring by 
public and private sector employers.
    The field staff of the VETS is stationed in a nationwide 
network of regional, state and area offices. There is at least 
one VETS representative in every state and DOL Regional Office 
(Boston, New York, Philadelphia, Atlanta, Chicago, Dallas, 
Kansas City, Denver, San Francisco, and Seattle). Other than 
the regional office staff, most VETS staff are located in state 
job service agency offices.
    The major activities and programs for veterans, Reservists, 
National Guard members, and transitioners conducted by the 
Office of the ASVET are: Job Service and One Stop Service 
Centers, Disabled Veterans Outreach Program, Transition 
Assistance Program, Unemployment Compensation for Ex-
servicemembers, Veterans Affirmative Action, Training Programs 
under the Job Training Partnership Act, Reemployment Rights, 
Veterans' Preference and Federal Contractor Non-Compliance 
Complaints, and National Veterans' Training Institute.

                  AMERICAN BATTLE MONUMENTS COMMISSION

    The American Battle Monuments Commission (ABMC), created by 
an Act of Congress in 1923 (36USC121-138B) is a federal agency 
responsible for the construction and permanent maintenance of 
military cemeteries and memorials on foreign soil, as well as 
certain memorials in the United States. Its principal functions 
are to commemorate, through the erection and maintenance of 
suitable memorial shrines, the sacrifices and achievements of 
the American armed forces where they have served since April 6, 
1917; to design, construct, operate, and maintain permanent 
American military burial grounds and memorials in foreign 
countries; to control the design and construction on foreign 
soil of U.S. military monuments and markers by other U.S. 
citizens and organization, both public and private; and to 
encourage U.S. governmental agencies and private individuals 
and organizations to maintain adequately the monuments and 
markers erected by them on foreign soils. When directed by 
Congress, the Commission develops and erects national military 
monuments in the United States, such as the Korean War Veterans 
Memorial and the World War II Memorial.
    In performance of these functions, ABMC administers, 
operates and maintains 24 permanent American military cemetery 
memorials and 52 monuments, memorials, markers and separate 
chapels in fourteen foreign countries, the Commonwealth of the 
Northern Mariana Islands, Gibraltar, and four memorials in the 
United States.
    Interred in the cemeteries are 124,914 U.S. war dead--750 
from the Mexican War, 30,921 from World War I, and 93,243 from 
World War II. Additionally, 6,573 American veterans and others 
are interred in the Mexico City and Corozal cemeteries. The 
Mexico City cemetery and those of the World Wars are closed to 
future burials except for the remains of U.S. war dead yet to 
be found in the battle areas of World Wars I and II. In 
addition to burials at the cemeteries overseas, 94,132 U.S. 
servicemen and women of the World Wars, Korea, and Vietnam are 
commemorated individually by name on the Tablets of the Missing 
at cemetery memorials and at three memorials on U.S. soil.
    ABMC also provides information and assistance, on request, 
to relatives and friends of the war dead interred or 
commemorated at its facilities.

        MESSAGES FROM THE PRESIDENT AND EXECUTIVE COMMUNICATIONS

    A communication from the President of the United States, 
transmitting the Administration's 1997 National Drug Control 
Strategy, pursuant to 21 U.S.C. 1504.

    A communication from the President of the United States, 
transmitting the Administration's 1998 National Drug Control 
Strategy, pursuant to 21 U.S.C. 1504.

    A letter from the Director, Office of Regulations 
Management, Department of Veterans Affairs, transmitting the 
Department's final rule--Diseases Associated with Exposure to 
Certain Herbicide Agents (Prostate Cancer and Acute and 
Subacute Peripheral Neuropathy) (RIN: 2900-AI35) Received 
November 12, 1996, pursuant to 5 U.S.C. 801(a)(1)(A).

    A letter from the Director, Office of Regulations 
Management, Department of Veterans Affairs, transmitting the 
Department's final rule--Contract Program for Veterans With 
Alcohol and Drug Dependence Disorders (RIN: 2900-AH77) Received 
October 31, 1996, pursuant to 5 U.S.C. 801(a)(1)(A).

    A letter from the Director, Office of Regulations 
Management, Department of Veterans Affairs, transmitting the 
Department's final rule--Willful Misconduct (RIN: 2900-AI26) 
Received October 31, 1996, pursuant to 5 U.S.C. 801(a)(1)(A).

    A letter from the Director, Office of Regulations 
Management, Department of Veterans Affairs, transmitting the 
Department's final rule--Evidence of Dependents and Age (RIN: 
2900-AH51) Received October 30, 1996, pursuant to 5 U.S.C. 
801(a)(1)(A).

    A letter from the Director, Office of Regulations 
Management, Department of Veterans Affairs, transmitting the 
Department's final rule--Community Residential Care Program and 
Contract Program for Veterans With Alcohol and Drug Dependence 
Disorders (RIN: 2900-AH61) Received December 2, 1996, pursuant 
to 5 U S.C. 801(a)(1)(A).

    A letter from the THE NATIONAL ADJUTANT, THE DISABLED 
AMERICAN VETERANS, transmitting the report of the proceedings 
of the organization's 75th National Convention, including their 
annual audit report of receipts and expenditures as of December 
31, 1995--Received in the United States House of 
Representatives November 14, 1996, pursuant to 36 U.S.C. 90i 
and 44 U.S.C. 1332.

    A letter from the Director of the Office of Regulations 
Management, Department of Veterans Affairs, transmitting the 
Department's final rule--Miscellaneous Regulations (RIN: 2900-
AI39) Received December 26, 1996, pursuant to 5 U.S.C. 
801(a)(1)(A).

    A letter from the Director of the Office of Regulations 
Management, Department of Veterans Affairs, transmitting the 
Department's final rule--Appeals Regulations: Notice of Board 
of Veterans' Appeals (RIN: 2900-AI59) Received December 27, 
1996, pursuant to 5 U.S.C. 801(a)(1)(A).

    A letter from the Director, Office of Personnel Management, 
transmitting OPM's Fiscal Year 1995 annual report on Veteran's 
Employment in the Federal Government, pursuant to 38 U.S.C. 
4214(e)(1).

    A letter from the THE DIRECTOR, NATIONAL LEGISLATIVE 
COMMISSION, THE AMERICAN LEGION, transmitting the proceedings 
of the 78th National Convention of the American Legion, held in 
Salt Lake City, Utah from September 3, 4, and 5, 1996, as well 
as a report on the Organization's activities for the year 
preceding the Convention, pursuant to 36 U.S.C. 49.

    A letter from the Secretaries of Veterans Affairs and 
Defense, transmitting a report on the implementation of the 
health resources sharing portion of the ``Department of 
Veterans Affairs and Department of Defense Health Resources 
Sharing and Emergency Operations Act'' for Fiscal Year 1996, 
pursuant to 38 U.S.C. 8111(f).

    A letter from the Director of the Office of Regulations 
Management, Department of Veterans Affairs, transmitting the 
Department's final rule--Delegation of Subpoena Authority and 
Description of Means of Service (RIN: 2900-AH00) Received 
December 26, 1996, pursuant to 5 U.S.C. 801(a)(1)(A).

    A letter from the Director of the Office of Regulations 
Management, Department of Veterans Affairs, transmitting the 
Department's final rule--Adjudication Regulations; 
Miscellaneous (RIN: 2900-AI43) Received January 6, 1997, 
pursuant to 5 U.S.C. 801(a)(1)(A).

    A letter from the Director, Office of Regulations 
Management, Department of Veterans Affairs, transmitting the 
Department's final rule--Loan Guaranty: Limitation on Discount 
Points Financed in Connection With Interest Rate Reduction 
Refinancing Loans (RIN: 2900-AH90) Received January 21, 1997, 
pursuant to 5 U.S.C. 801(a)(1)(A).

    A letter from the Director of the Office of Regulations 
Management, Department of Veterans Affairs, transmitting the 
Department's final rule--Dependency and Income (38 CFR Part 3) 
(RIN: 2900-AI47) Received February 5, 1997, pursuant to 5 
U.S.C. 801(a)(1)(A).

    A letter from the Director of the Office of Regulations 
Management, Department of Veterans Affairs, transmitting the 
Department's final rule--Spouse and Surviving Spouse (38 CFR 
Part 3) (RIN: 2900-AI36) Received February 4, 1997, pursuant to 
5 U.S.C. 801(a)(1)(A).

    A letter from the Director of the Office of Regulations 
Management, Department of Veterans Affairs, transmitting the 
Department's final rule--VA Homeless Providers Grant and Per 
Diem Program Clarification of Per Diem Eligibility (RIN: 2900-
AH89) Received February 10, 1997, pursuant to 5 U.S.C. 
801(a)(1)(A).

    A letter from the Director, Office of Regulations 
Management, Department of Veterans Affairs, transmitting the 
Department's final rule--Rulemaking Procedures; Public 
Participation (38 CFR Part 1) (RIN: 2900-AI33) Received March 
5, 1997, pursuant to 5 U.S.C. 801(a)(1)(A).

    A letter from the Secretary of Veterans Affairs, 
transmitting the Fiscal Year 1996 Annual Report of the 
Secretary of Veterans Affairs, pursuant to 38 U.S.C. 214, 
221(c), and 664.

    A letter from the Director, Office of Regulations 
Management, Department of Veterans Affairs, transmitting the 
Department's final rule--Upgraded Discharges (RIN: 2900-AI40) 
Received March 26, 1997, pursuant to 5 U.S.C. 801(a)(1)(A).

    A letter from the Director, Office of Regulations 
Management, Department of Veterans Affairs, transmitting the 
Department's final rule--Veterans Education: Increase in Rates 
Payable Under the Montgomery GI Bill--Active Duty (RIN: 2900-
AI55) Received March 26, 1997, pursuant to 5 U.S.C. 
801(a)(1)(A).

    A letter from the Director, Office of Regulations 
Management, Department of Veterans Affairs, transmitting the 
Department's final rule--Reduction of Debt Through the 
Performance of Work-Study Services (38 CFR Part 1) (RIN: 2900-
AF29) Received April 7, 1997, pursuant to 5 U.S.C. 
801(a)(1)(A).

    A letter from the Director, Office of Regulations 
Management, Department of Veterans Affairs, transmitting the 
Department's final rule--Vocational Rehabilitation; 
Miscellaneous Changes (38 CFR Part 21) (RIN: 2900-AI29) 
Received April 8, 1997, pursuant to 5 U.S.C. 801(a)(1)(A).

    A letter from the Chief, Regulations Unit, Internal Revenue 
Service, transmitting the Department's final rule--Medical: 
Nonsubstantive Miscellaneous Changes (38 CFR Part 17) (RIN: 
2900-AI37) Received April 8, 1997, pursuant to 5 U.S.C. 
801(a)(1)(A).

    A letter from the Secretary of Veterans Affairs, 
transmitting the Department's report entitled ``Veterans 
Equitable Resource Allocation System Briefing Booklet'' (March 
1997).

    A letter from the Director, Office of Regulations 
Management, Department of Veterans Affairs, transmitting the 
Department's final rule--Removal of Certain Limitations on Cost 
Comparisons Related to Contracting Out of Activities at VA 
Health-Care Facilities (RIN: 2900-AI61) Received April 14, 
1997, pursuant to 5 U.S.C. 801(a)(1)(A).

    A letter from the Director, Office of Regulations 
Management, Department of Veterans Affairs, transmitting the 
Department's final rule--Retroactive Payments Due to a 
Liberalizing Law or VA Issue (38 CFR Part 3) (RIN: 2900-AI57) 
Received April 11, 1997, pursuant to 5 U.S.C. 801(a)(1)(A).

    A letter from the Secretary of Veterans Affairs, 
transmitting a report covering the disposition of cases granted 
relief from administrative error, overpayment and forfeiture by 
the Administrator in 1996, pursuant to 38 U.S.C. 210(c)(3)(B).

    A letter from the Director, Office of Regulations 
Management, Department of Veterans Affairs, transmitting the 
Department's final rule--Compensation for Certain Undiagnosed 
Illnesses (38 CFR Part 3) (RIN: 2900-AI77) Received April 29, 
1997, pursuant to 5 U.S.C. 801(a)(1)(A).

    A letter from the Secretary of Defense, transmitting the 
Department's report on small business loans for members 
released from reserve service during contingency operations, 
pursuant to Public Law 104-201, Section 1234 (110 Stat. 2697).

    A letter from the Secretary of Labor, transmitting the 
annual report evaluating the Uniformed Services Employment and 
Reemployment Rights Act of 1994 (USERRA) for fiscal year 1996, 
pursuant to 38 U.S.C. 4332.

    A letter from the Secretary of Veterans Affairs, 
transmitting a draft of proposed legislation entitled 
``Veterans' Compensation Cost-of-Living Adjustment and Benefit 
Programs Improvement Act of 1997''.

    A letter from the Director, Office of Regulations 
Management, Department of Veterans Affairs, transmitting the 
Department's final rule--Guidelines for Furnishing Sensori-
neural Aids (i.e., eyeglasses, contact lenses, hearing aids) 
(RIN: 2900-AI60) Received May 29, 1997, pursuant to 5 U.S.C. 
801(a)(1)(A).

    A letter from the Director, Office of Regulations 
Management, Department of Veterans Affairs, transmitting the 
Department's final rule--Schedule for Rating Disabilities; 
Muscle Injuries (RIN: 2900-AE89) Received May 29, 1997, 
pursuant to 5 U.S.C. 801 (a)(1)(A).

    A letter from the Secretary of Veterans Affairs, 
transmitting a draft of proposed legislation to amend title 38, 
United States Code, to make certain improvements in the housing 
loan programs for veterans and eligible persons.

    A letter from the Secretary of Veterans Affairs, 
transmitting a draft of proposed legislation to amend title 38, 
United States Code, to permit VA to retain and use, for the 
purpose of providing medical care and services to veterans, all 
amounts recovered or collected as a result of medical care and 
services furnished by VA.

    A letter from the Secretary of Veterans Affairs, 
transmitting a draft of proposed legislation to amend title 38, 
United States Code, to establish a presumption of total 
disability for certain individuals for purpose of nonservice-
connected disability pension.

    A letter from the Secretary of Veterans Affairs, 
transmitting a draft of proposed legislation to amend title 38, 
United States Code, to amend provisions of law governing 
benefits for certain children of Vietnam veterans who are born 
with spina bifida.

    A letter from the Secretary of Defense, transmitting the 
Department's annual report on Outreach Regarding Persian Gulf 
Illnesses.

    A letter from the Secretary of Veterans Affairs, 
transmitting a draft of proposed legislation to amend sections 
2306 and 2403 of title 38, United States Code, to authorize 
memorialization of deceased spouses and surviving spouses of 
veterans and deceased members of the Armed Forces whose remains 
are not available for interment.

    A letter from the Director, Office of Regulations 
Management, Department of Veterans Affairs, transmitting the 
Department's final rule--Veterans' Benefits Improvements Act of 
1996 (RIN: 2900-AI66) Received June 27, 1997, pursuant to 5 
U.S.C. 801(a)(1)(A).

    A letter from the Director, Office of Regulations 
Management, Department of Veterans Affairs, transmitting the 
Department's final rule--Veterans Education: Submission of 
School Catalogs to State Approving Agencies (RIN: 2900-AH97) 
Received June 27, 1997, pursuant to 5 U.S.C. 801(a)(1)(A).

    A letter from the Director, Office of Regulations 
Management, Department of Veterans Affairs, transmitting the 
Department's final rule--Minimum Income Annuity (RIN: 2900-
AI83) Received July 2, 1997, pursuant to 5 U.S.C. 801(a)(1)(A).

    A letter from the Director, Office of Regulations 
Management, Department of Veterans Affairs, transmitting the 
Department's final rule--Servicemen's and Veterans' Group Life 
Insurance (RIN: 2900-AI73) July 2, 1997, pursuant to 5 U.S.C. 
801(a)(1)(A).

    A letter from the Director, Office of Regulations 
Management, Department of Veterans Affairs, transmitting the 
Department's final rule--Veterans Education: Approval of 
Training by Independent Study, Including Television (RIN: 2900-
AI34) Received July 23, 1997, pursuant to 5 U.S.C. 
801(a)(1)(A).

    A letter from the Secretary of Veterans Affairs, 
transmitting a draft of proposed legislation to provide 
flexibility in the order in which the Boards of Veterans' 
Appeals hears and considers appeals.

    A letter from the Secretary of Veterans Affairs, 
transmitting a draft of proposed legislation to authorize 
provision of care to veterans treated with nasopharyngeal 
radium irradiation.

    A letter from the Acting Secretary, Department of Veterans 
Affairs, transmitting a draft of proposed legislation to remove 
a statutory provision requiring a specified number of full-time 
equivalent positions in the VA's Office of Inspector General.

    A letter from the Director, Office of Regulations 
Management, Department of Veterans Affairs, transmitting the 
Department's final rule--Provision of Health Care to Vietnam 
Veterans' Children with Spina Bifida (RIN: 2900-AI65) Received 
September 25, 1997, pursuant to 5 U.S.C. 801(a)(1)(A).

    A letter from the Director, Office of Regulations 
Management, Department of Veterans Affairs, transmitting the 
Department's final rule--Monetary Allowance Under 38 U.S.C. 
1805 for a Child Suffering from Spina Bifida Who is a Child of 
a Vietnam Veteran (RIN: 2900-AI70) Received September 25, 1997, 
pursuant to 5 U.S.C. 801(a)(1)(A).

    A letter from the Director, Office of Regulations 
Management, Department of Veterans Affairs, transmitting the 
Department's final rule--Provision of Vocational Training and 
Rehabilitation to Vietnam Veterans' Children with Spina Bifida 
(RIN: 2900-AI72) Received September 25, 1997, pursuant to 5 
U.S.C. 801(a)(1)(A).

    A letter from the Director, Office of Regulations 
Management, Department of Veterans Affairs, transmitting the 
Department's final rule--Survivors and Dependents Education: 
Extension of Eligibility Period (RIN: 2900-AI45) Received 
October 1, 1997, pursuant to 5 U.S.C. 801(a)(1)(A).

    A letter from the Director, Office of Regulations 
Management, Department of Veterans Affairs, transmitting the 
Department's final rule--Disinterments from National Cemeteries 
(RIN: 2900-AI21) Received October 1, 1997, pursuant to 5 U.S.C. 
801(a)(1)(A).

    A letter from the Director, Office of Regulations 
Management, Department of Veterans Affairs, transmitting the 
Department's final rule--Appeals Regulations: Remand for 
Further Development (RIN: 2900-AI50) Received October 2, 1997, 
pursuant to 5 U.S.C. 801(a)(1)(A).

    A letter from the Acting Assistant Secretary, Department of 
Labor, transmitting a report concerning Recommendations to 
Ensure Compliance by Federal Contractors and Subcontractors, 
pursuant to Public Law 104-208, Section 8118 (110 Stat. 3009-
114).

    A letter from the Director, Office of Regulations 
Management, Department of Veterans Affairs, transmitting the 
Department's final rule--Loan Guaranty: Requirements for 
Interest Rate Reduction Refinancing Loans (RIN: 2900-AI92) 
Received October 6. 1997, pursuant to 5 U.S.C. 801(a)(1)(A).

    A letter from the Director, Office of Regulations 
Management, Department of Veterans Affairs, transmitting the 
Department's final rule--Loan Guaranty: Credit Standards (RIN: 
2900-AI16) Received October 10, 1997, pursuant to 5 U.S.C. 
801(a)(1)(A).

    A letter from the Director, Office of Regulations 
Management, Department of Veterans Affairs, transmitting the 
Department's final rule--Informed Consent for Patient Care 
(RIN: 2900-AH72) Received October 10, 1997, pursuant to 5 
U.S.C. 801(a)(1)(A).

    A letter from the Acting Director, Office of Personnel 
Management, transmitting OPM's Fiscal Year 1996 annual report 
on Veteran's Employment in the Federal Government, pursuant to 
38 U.S.C. 4214(e)(1).

    A letter from the Director, Office of Regulations 
Management, Department of Veterans Affairs, transmitting the 
Department's final rule--Board of Veterans' Appeals: Rules of 
Practice--Death of Appellant During Pendency of Appeal (RIN: 
2900-AI86) Received October 21, 1997, pursuant to 5 U.S.C. 
801(a)(1)(A).

    A letter from the Director, Office of Regulations 
Management, Department of Veterans Affairs, transmitting the 
Department's final rule--Veterans and Reservists Education: 
Additional Educational Assistance While Serving in the Selected 
Reserve (RIN: 2900-AI79) Received October 23, 1997, pursuant to 
5 U.S.C. 801(a)(1)(A).

    A letter from the Secretary of Defense, transmitting a 
report entitled ``Federally Sponsored Research on Persian Gulf 
Veterans' Illness'', pursuant to Public Law 103-337, Section 
722(f).

    A letter from the Director, Office of Regulations 
Management, Department of Veterans Affairs, transmitting the 
Department's final rule--Veterans Education: Increase in Rates 
Payable Under the Montgomery GI Bill--Active Duty (RIN: 2900-
AI90) Received October 27, 1997, pursuant to 5 U.S.C. 
801(a)(1)(A).

    A letter from the Director, Office of Regulations 
Management, Department of Veterans Affairs, transmitting the 
Department's final rule--Miscellaneous Educational Revisions 
(RIN: 2900-AI69) Received October 27, 1997, pursuant to 5 
U.S.C. 801(a)(1)(A).

    A letter from the Director, Office of Regulations 
Management, Department of Veterans Affairs, transmitting the 
Department's final rule--Grants to States for Construction or 
Acquisition of State Home Facilities (RIN: 2900-AI84) Received 
November 9, 1997, pursuant to 5 U.S.C. 801(a)(1)(A).

    A letter from the Director, Office of Regulations 
Management, Department of Veterans Affairs, transmitting the 
Department's final rule--Veterans Education: Approval of 
Correspondence Programs or Courses (RIN: 2900-AH91) Received 
December 3, 1997, pursuant to 5 U.S.C. 801(a)(1)(A).

    A letter from the Director, Office of Regulations 
Management, Department of Veterans Affairs, transmitting the 
Department's final rule--Loan Guaranty: Electronic Payment of 
Funding Fee (RIN: 2900-AH73) Received November 19, 1997, 
pursuant to 5 U.S.C. 801(a)(1)(A).

    A letter from the Director, Office of Regulations 
Management, Department of Veterans Affairs, transmitting the 
Department's final rule--Guidelines for Furnishing Sensori-
neural Aids (RIN: 2900-AI60) Received December 8, 1997, 
pursuant to 5 U.S.C. 801(a)(1)(A).

    A letter from the Director, Office of Regulations 
Management, Department of Veterans Affairs, transmitting the 
Department's final rule--Schedule for Rating Disabilities; The 
Cardiovascular System (RIN: 2900-AE40) Received December 8, 
1997, pursuant to 5 U.S.C. 801(a)(1)(A).

    A letter from the Director, Office of Regulations 
Management, Department of Veterans Affairs, transmitting the 
Department's final rule--Loan Guaranty: Requirements for 
Interest Rate Reduction Refinancing Loans (RIN: 2900-AI92) 
Received November 31, 1997, pursuant to 5 U.S.C. 801(a)(1)(A).

    A letter from the Director, Office of Regulations 
Management, Department of Veterans Affairs, transmitting the 
Department's final rule--Active Military Service Certified 
Under Section 401 of Public Law 95-202 (RIN: 2900-AI91) 
Received January 5, 1998, pursuant to 5 U.S.C. 801(a)(1)(A).

    A letter from the Director, Office of Regulations 
Management, Department of Veterans Affairs, transmitting the 
Department's final rule--Minimum Income Annuity (RIN: 2900-
AI83) Received January 5, 1998, pursuant to 5 U.S.C. 
801(a)(1)(A).

    A letter from the Administrative Assistant, the Disabled 
American Veterans, transmitting the report of the proceedings 
of the organization's 76th National Convention, including their 
annual audit report of receipts and expenditures as of December 
31, 1996, pursuant to 36 U.S.C. 90i and 44 U.S.C. 1332.

    A letter from the Secretary of Defense, transmitting a 
report on several initiatives for Gulf War veterans, pursuant 
to Public Law 103-337, Section 721(h).

    A letter from the Director, National Legislative 
Commission, The American Legion, transmitting the proceedings 
of the 79th National Convention of the American Legion, held in 
Orlando, Florida from September 2, 3 and 4, 1997 as well as a 
report on the Organization's activities for the year preceding 
the Convention, pursuant to 36 U.S.C. 49.

    A letter from the Director, Office of Regulations 
Management, Department of Veterans Affairs, transmitting the 
Department's final rule--Compensation for Certain Undiagnosed 
Illnesses (RIN: 2900-AI77) Received March 4,1998, pursuant to 5 
U.S.C. 801(a)(1)(A).

    A letter from the Director, Office of Regulations 
Management, Department of Veterans Affairs, transmitting the 
Department's final rule--Treatment of Research-Related Injuries 
to Human Subjects (RIN: 2900-AH68) Received March 4, 1998, 
pursuant to 5 U.S.C. 801(a)(1)(A).

    A letter from the Director, Office of Regulations 
Management, Department of Veterans Affairs, transmitting the 
Department's final rule--Loan Guaranty: VA-Guaranteed Loans on 
the Automatic Basis, Withdrawal of Automatic Processing 
Authority, Record Retention Requirements, and Elimination of 
Late Reporting Waivers (RIN: 2900-AH23) Received March 10, 
1998, pursuant to 5 U.S.C. 801(a)(1)(A).

    A letter from the Assistant Secretary for Health Affairs, 
Department of Defense, transmitting an interim response to the 
reporting requirement prescribed in section 762 of the National 
Defense Authorization Act for Fiscal Year 1998, pursuant to 
Public Law 105-85.

    A letter from the Secretary of Defense transmitting a 
report on the Effectiveness of Medical Research Initiatives 
Regarding Gulf War Illness.

    A letter from the Director, Office of Regulations 
Management, Department of Veterans Affairs, transmitting the 
Department's final rule--Veterans Education: Reduction in 
Required Reports (RIN: 2900-AI58) Received March 23, 1998, 
pursuant to 5 U.S.C. 801(a)(1)(A).

    A letter from the Director, Office of Regulations 
Management, Department of Veterans Affairs, transmitting the 
Department's final rule--VA Acquisition Regulations: Department 
Protests (RIN: 2900-AI51) Received March 27, 1998, pursuant to 
5 U.S.C. 801(a)(1)(A).

    A letter from the Director, Office of Regulations 
Management, Department of Veterans Affairs, transmitting the 
Department's final rule--VA Acquisition Regulations: Commercial 
Items (RIN: 2900-AI05) Received April 6, 1998, pursuant to 5 
U.S.C. 801(a)(1)(A).

    A letter from the Secretary of Labor, transmitting the 
annual report evaluating the Uniformed Services Employment and 
Reemployment Rights Act of 1994 (USERRA) for fiscal year 1996, 
pursuant to 38 U.S.C. 4332.

    A letter from the Secretary of Defense and Aching Secretary 
of Veterans Affairs, transmitting a report on the 
implementation on that portion of the law dealing with sharing 
of health care resources between the two departments, pursuant 
to 38 U.S.C. 8111(f).

    A letter from the Director, Office of Regulations 
Management, Department of Veterans Affairs, transmitting the 
Department's final rule--Reporting Health Care Professionals to 
State Licensing Boards (RIN: 2900-AI78) Received April 28, 
1998, pursuant to 5 U.S.C. 801(a)(1)(A).

    A letter from the Adjutant General, the Veterans of Foreign 
Wars of the U.S., transmitting proceedings of the 98th National 
Convention of the Veterans of Foreign Wars of the United 
States, held in Salt Lake City, Utah, August 17-21, 1997, 
pursuant to 36 U.S.C. 118 and 44 U.S.C. 1332.

    A letter from the Acting Secretary, Department of Veterans 
Affairs, transmitting a report covering the disposition of 
cases granted relief from administrative error, overpayment and 
forfeiture by the Administrator in 1997, pursuant to 38 U.S.C. 
210(c)(3)(B).

    A letter from the Director, Office of Regulations 
Management, Department of Veterans Affairs, transmitting the 
Department's final rule--Veterans' Training: Time Limit for 
Submitting Certifications under the Service Members 
Occupational Conversion and Training Act (RIN: 2900-AI85) 
Received May 8, 1998, pursuant to 5 U.S.C. 801(a)(1)(A).

    A letter from the Secretary of Labor, transmitting the 1996 
Annual Report to Congress, describing employment and training 
programs for veterans during program year 1995 and fiscal year 
1996.

    A letter from the Secretary of Veterans Affairs, 
transmitting a draft of proposed legislation to authorize a new 
tobacco use cessation program, permanently authorize VA to 
collect payments from third-party private health insurance 
carriers for care VA provides to certain veterans, collect 
copayments from certain veterans receiving VA care, verify the 
income of certain veterans, and authorize medical care related 
construction projects and leases.

    A letter from the Director, Office of Regulations 
Management, Department of Veterans Affairs, transmitting the 
Department's final rule--Veterans Education: Increase in Rates 
Payable for Cooperative Training Under the Montgomery GI Bill--
Active Duty (RIN: 2900-AJ10) Received May 19, 1998, pursuant to 
5 U.S.C. 801(a)(1)(A).

    A letter from the Director, Office of Regulations 
Management, Veterans Affairs, transmitting the Department's 
final rule--Board of Veterans' Appeals: Rules of Practice--
Continuation of Representation Following Death of a Claimant or 
Apellant (RIN: 2900-AI87) Received June 17, 1998, pursuant to 5 
U.S.C. 801(a)(1)(A).

    A letter from the Director, Office of Regulations 
Management, Department of Veterans Affairs, transmitting the 
Department's final rule--Criteria for Approving Flight Courses 
for Educational Assistance Programs (RIN: 2900-AI76) Received 
June 17, 1998, pursuant to 5 U.S.C. 801(a)(1)(A).

    A letter from the Director, Office of Regulations 
Management, Department of Veterans Affairs, transmitting the 
Department's final rule--Veterans' Education: Effective Date 
for Awards of Educational Assistance to Veterans Who Were 
Voluntarily Discharged (RIN: 2900-AI88) Received June 17, 1998, 
pursuant to 5 U.S.C. 801(a)(1)(A).

    A letter from the Assistant Secretary for Policy and 
Planning, Department of Veterans Affairs, transmitting the 
Annual Report of the Secretary of Veterans Affairs for Fiscal 
Year 1997, pursuant to 38 U.S.C. 214, 221(c), and 664.

    A letter from the Secretary of Veterans Affairs, 
transmitting a draft of proposed legislation to amend title 38, 
United States Code, to authorize a cost-of-living adjustment in 
the rates of disability compensation for veterans with service-
connected disabilities and dependency and indemnity 
compensation for survivors of such veterans, to authorize 
payment of these benefits at full rates for certain Filipinos 
who reside in the United States, to establish a reserve to 
fully fund ``H'' policy holders under the National Service Life 
Insurance program, and for other purposes.

    A letter from the Director, Office of Regulations 
Management, Department of Veterans Affairs, transmitting the 
Department's final rule--Veterans Education: Suspension and 
Discontinuance of Payments (RIN: 2900-AF85) Received July 2, 
1998, pursuant to 5 U.S.C. 801(a)(1)(A).

    A letter from the Director, Office of Regulations 
Management, Department of Veterans Affairs, transmitting the 
Department's final rule--Schedule for Rating Disabilities: Cold 
injuries (RIN: 2900-AI46) Received July 14, 1998, pursuant to 5 
U.S.C. 801(a)(1)(A).

    A letter from the Director, Office of Regulations 
Management, Department of Veterans Affairs, transmitting the 
Department's final rule--Payment for Non-VA Physician Services 
Associated with Either Outpatient or Inpatient Care Provided at 
Non-VA Facilities (RIN: 2900-AH66) Received July 23, 1998, 
pursuant to 5 U.S.C. 801(a)(1)(A).

    A letter from the Director, Office of Regulations 
Management, Department of Veterans Affairs, transmitting the 
Department's final rule--Provision of Drugs and Medicines to 
Certain Veterans in State Homes (RIN: 2900-AJ34) Received July 
21, 1998, pursuant to 5 U.S.C. 801(a)(1)(A).

    A letter from the Director, Office of Regulations 
Management, Department of Veterans Affairs, transmitting the 
Department's final rule--Election of Education Benefits (RIN: 
2900-AH88) Received August 21, 1998, pursuant to 5 U.S.C. 
801(a)(1)(A).

    A letter from the Director, Office of Regulations 
Management Department of Veterans Affairs, transmitting the 
Department's final rule--Additional Disability or Death Due to 
Hospital Care, Medical or Surgical Treatment, Examination, or 
Training and Rehabilitation Services (RIN: 2900-AJ04) Received 
August 19, 1998, pursuant to 5 U.S.C. 801(a)(1)(A).

    A letter from the Director, Office of Regulations 
Management, Department of Veterans Affairs, transmitting the 
Department's final rule--Civilian Health and Medical Program of 
the Department of Veterans Affairs (CHAMPVA) (RIN: 2900-AE64) 
Received August 21, 1998, pursuant to 5 U.S.C. 801(a)(1)(A).

    A letter from the Principal Deputy Assistant Secretary for 
Congressional Affairs, Department of Veterans Affairs, 
transmitting a draft of proposed legislation to provide a 
temporary authority for the use of voluntary separation 
incentives by the Department of Veterans Affairs to reduce 
employment levels, and for other purposes.

    A letter from the Director, Office of Regulations 
Management, Department of Veterans Affairs, transmitting the 
Department's final rule--Claims Based on Exposure to Ionizing 
Radiation (Prostate Cancer and Any Other Cancer) (RIN: 2900-
AI00) Received September 21, 1998, pursuant to 5 U.S.C. 
801(a)(1)(A).

    A letter from the Director, Office of Regulations 
Management, Department of Veterans Affairs, transmitting the 
Department's final rule--Eligibility Reporting Requirements 
(RIN: 2900-AJ09) Received October 8, 1998, pursuant to 5 U.S.C. 
801(a)(1)(A).

    A letter from the Secretary of Labor, transmitting a report 
on the labor market situation for certain disabled veterans and 
Vietnam Theater veterans, pursuant to 38 U.S.C. 2010A.

    A letter from the Principal Deputy Assistant Secretary For 
Congressional Affairs, Department of Veterans Affairs, 
transmitting a draft of proposed legislation to provide a 
temporary authority for the use of voluntary separation 
incentives by the Department of Veterans Affairs to reduce 
employment levels, and for other purposes.

                                                                          SUMMARY OF VETERANS' AFFAIRS COMMITTEE ACTION
                                                           BILLS AND RESOLUTIONS REFERRED AND HEARINGS / EXECUTIVE SESSIONS CONDUCTED
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                 Congress
                                         -------------------------------------------------------------------------------------------------------------------------------------------------------
                                           87th    88th    89th    90th    91st     92d     93d    94th    95th    96th    97th    98th    99th    100th   101st   102d    103d    104th   105th
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Bills and resolutions referred..........     592     508     791     685     740     693     839     719     709     339     273     229     198     147     194     215     174     128     134
Hearing sessions........................      45      50      71      46      43      37      44      58      72      84      89      71      76      44      72      67      71      39      56
Meetings and mark-up sessions...........      15      21      32      13      27      21      16      30      26      19      18      16      20      16      26      20      23      19      18
Bills reported..........................      52      41      47  \8\ 19      34      26  \9\ 14      23      32      11      16      15      17      14      33      21      25      15      15
Bills in House..........................   \1\ 8   \5\ 5   \6\ 4       4       1       4       1  ......       1       1       1       3       3       1       4       3      11  ......  ......
Pending in Senate committees............  \2\ 13       7  \7\ 12       3       9       7       2  \10\ 9      17       3       6       6       8       9      23       7      11      10       1
Bills on Senate Calendar or in Senate...   \3\ 2  ......       1  ......  ......  ......  ......  ......       1       1       1  ......       1       3       1       3       3  ......  ......
Recommitted.............................  ......  ......  ......  ......  ......  ......  ......  ......  ......  ......  ......  ......  ......  ......  ......  ......  ......  ......  ......
Bills vetoed............................  ......  ......  ......  ......  ......       2       1  ......  ......       1  ......  ......  ......  ......  ......  ......  ......  ......  ......
Bills passed over veto..................  ......  ......  ......  ......  ......  ......       1  ......  ......       1  ......  ......  ......  ......  ......  ......  ......  ......  ......
Laws enacted............................  \4\ 32      29      30      15      24      15      15      15      13       6       8       8       6       4       8      24      15       6       6
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
\1\ Including 4 bills enacted as amendment in other legislation; 1 left in House when similar Senate bill returned to Senate; and 1 similar to another bill enacted (Public Law 87-645).
\2\ Includes 2 bills enacted as amendments to other bills.
\3\ Includes 1 bill enacted as amendment to another bill.
\4\ Some laws include the substance of more than 1 bill reported separately. 39 separately reported bills were enacted, 7 as amendments to other legislation.
\5\ Provisions of 3 of these bills were passed by the House as separate bills, and the provisions of 1 bill were included as an amendment to another bill which became public law.
\6\ \7\ One bill in a Senate committee had purpose accomplished administratively; 5 other were enacted as sections of another bill; and portions of 1 bill left in the House were enacted as
  part of another bill.
\8\ Includes S.J. Res. 197 making technical correction to law, which was brought to House floor for immediate consideration and passage by unanimous consent.
\9\ The difference in number of bills reported (14) and laws enacted (15) is due to the fact that S. 3705 did not go to the House Committee. However, the subject matter was included in H.R.
  12628.
\10\ Includes H.R. 9576 subject matter of which was contained in S. 969, passed in lieu.

                    HEARINGS AND EXECUTIVE SESSIONS

    (All hearings and executive sessions of the Committee are 
held in the Committee hearing room, 334 Cannon House Office 
Building, unless otherwise designated.)
    February 5, 1997. OPEN. 4:00 p.m. Full Committee. Meeting. 
Organizational.

    February 11, 1997. OPEN. 9:30 a.m. House and Senate 
Veterans Affairs Committees. Joint Hearing. Room 345 Cannon 
HOB. The 1997 legislative priorities of the Veterans of Foreign 
Wars.

    February 11, 1997. OPEN. 1:00 p.m. Full Committee. Hearing. 
Persian Gulf War Illnesses. (Serial No. 105-1)

    February 13, 1997. OPEN. 9:30 a.m. Full Committee. Meeting. 
Oversight Plan.

    February 13, and February 27, 1997. OPEN. 9:30 a.m. Full 
Committee. Hearing. Fiscal Year 1998 Department of Veterans 
Affairs Budget. (Serial No. 105-2)

    March 6, 1997. OPEN. 9:30 a.m. House and Senate Veterans 
Affairs Committees. Joint Hearing. Room 345 Cannon HOB. The 
1997 legislative priorities of the Blinded Veterans 
Association; Non Commissioned Officers Association; Military 
Order of the Purple Heart; The Retired Officers Association; 
Paralyzed Veterans of America; and Jewish War Veterans.

    March 19, 1997. OPEN. 9:30 a.m. House and Senate Veterans 
Affairs Committees. Joint Hearing. Room 345 Cannon HOB. The 
1997 legislative priorities of the Disabled American Veterans.

    March 20, 1997. OPEN. 9:30 a.m. House and Senate Veterans 
Affairs Committees. Joint Hearing. Room 345 Cannon HOB. The 
1997 legislative priorities of the Veterans of World War 1; 
American Ex-Prisoners of War; AMVETS and Vietnam Veterans of 
America.

    March 20, 1997. OPEN. 2:30 p.m. Full Committee. Meeting. To 
approve Committee's views and estimates for the FY 1998 budget 
for submission to the Budget Committee.

    March 20, 1997. OPEN. 3:00 p.m. Full Committee. Markup. 
H.R. 1090 and H.R. 1092.

    April 3, 1997. OPEN. 9:00 a.m. Gainesville VAMC, 
Gainesville, Florida. Hearing. Subcommittee on Health. Veterans 
Equitable Resource Allocation System (VERA). (Serial No. 105-3)

    April 16, 1997. OPEN. 10:00 a.m. Subcommittee on Health and 
Subcommittee on Oversight and Investigations. Joint Hearing. 
Persian Gulf War Veterans. (Serial No. 105-4)

    April 17,1997. OPEN. 9:30 a.m. Subcommittee on Oversight 
and Investigations. Hearing. Sexual Harassment in the VA. 
(Serial No. 105-5)

    May 7, 1997. OPEN. 8:30 a.m. Subcommittee on Benefits. 
Hearing. Government Performance and Results Act (GPRA) 
Strategies for the Veterans' Employment and Training Service 
(VETS). (Serial No. 105-6)

    May 8, 1997. OPEN. 9:30 a.m. Subcommittee on Health. 
Hearing. H.R. 1362 and Draft Bills Regarding Third Party 
Reimbursement and Physicians' Special Pay Provisions. (Serial 
No. 105-7)

    May 14, 1997. OPEN. 8:30 a.m. Subcommittee on Benefits. 
Hearing. Hearing on Operations Within the Compensation and 
Pension Service Using GPRA Principles, on the Processing of 
Persian Gulf War Claims, and VA's Proposed Legislation To Limit 
the Liability for Smoking-Related Illnesses. (Serial No. 105-8)

    May 15, 1997. OPEN. 9:30 a.m. Subcommittee on Health. 
Markup. H.R. 1362.

    May 21, 1997. OPEN. 1:30 p.m. Full Committee. Markup. H.R. 
1362, as amended, H.R. 1687, H.J. Res. 75.

    May 21, 1997. OPEN. 2:00 p.m. Full Committee. Hearing. 
Hearing to Accept the Report of the Veterans' Claims 
Adjudication Commission. (Serial No. 105-9)

    May 22, 1997. OPEN. 9:30 a.m. Subcommittee on Oversight and 
Investigations. Hearing. Safety and Security in the VA. (Serial 
No. 105-10)

    June 4, 1997. OPEN. 9:30 a.m. Full Committee. Hearing. H.R. 
699, Military Voting Rights Act of 1997. (Serial No. 105-11)

    June 5, 1997. OPEN. 9:30 a.m. Subcommittee on Benefits. 
Hearing. Government Performance and Results Act Strategies for 
Both the Veterans Benefits Administration's Education Service 
and the Vocational Rehabilitation and Counseling Services. 
(Serial No. 105-12)

    June 12, 1997. OPEN. 9:30 a.m. Full Committee. Markup. 
Budget Reconciliation instructions, H.R. 699.

    June 19, 1997. OPEN. 9:30 a.m. Subcommittee on Health. 
Hearing. VA's Health Care Treatment for Persian Gulf War 
Illnesses. (Serial No. 105-13)

    June 26, 1997. OPEN. 9:30 a.m. Subcommittee on Oversight 
and Investigations. Hearing 1. VA's Compliance with Year 2000 
Requirements. (Serial No. 105-14)

    July 9, 1997. OPEN. 10:00 a.m. Full Committee. Hearing. S. 
923 and H.R. 2040, To Deny Burial in a Federally Funded 
Cemetery and Other Benefits to Veterans Convicted of Certain 
Capital Crimes. (Serial No. 105-15)

    July 10, 1997 OPEN. 9:30 a.m. Subcommittee on Health. 
Hearing. Pharmaceutical Prices, and Draft Legislation on 
Homeless Veterans' Programs and Issues Related to Persian Gulf 
War Illness. (Serial No. 105-16)

    July 16, 1997. OPEN. 9:30 a.m. Subcommittee on Benefits. 
Hearing. Pending Legislative Proposals in the Areas of 
Education, Training, and Employment. (Serial No. 105-17)

    July 17, 1997. OPEN. 9:30 a.m. Subcommittee on Oversight 
and Investigations. Hearing. Sexual Harassment in the VA and 
H.R. 1703, Department of Veterans' Affairs Employment 
Discrimination Prevention Act. (Serial No. 105-18)

    July 24, 1997. OPEN. 9:15 a.m. Subcommittee on Health. 
Markup. H.R. 2206.

    July 24, 1997. OPEN. 9:30 a.m. Subcommittee on Health and 
Subcommittee on Oversight and Investigations. Joint Hearing. VA 
Consolidation of Medical Facility Management and Services. 
(Serial No. 105-19)

    July 28, 1997. OPEN. 9:00 a.m. U.S. Federal Court House, 
Montgomery, Alabama. Subcommittee on Oversight and 
Investigations. Hearing. Planning and Formation of Central 
Alabama Veterans Health Care System (CAVHCS). (Serial No. 105-
20)

    September 4, 1997. OPEN. 9:30 a.m. Subcommittee on 
Benefits. Markup. H.R. 2367.

    September 11, 1997. OPEN. 9:30 a.m. Full Committee. Markup. 
H.R. 2367, H.R. 2206 and S. 923.

    September 18, 1997. OPEN. 9:30 a.m. Subcommittee on 
Oversight and Investigations. Hearing. Government Performance 
and Results Act (GPRA) Strategies. (Serial No. 105-21)

    September 23, 1997. OPEN. 9:30 a.m. House and Senate 
Veterans Affairs Committees. Joint Hearing. The 1997 
legislative priorities of The American Legion.

    September 25, 1997. OPEN. 9:30 a.m. Subcommittee on 
Oversight and Investigations. Hearing. Hearing 2 on Year 2000 
Computer Compliance in the Department of Veterans Affairs. 
(Serial No. 105-22)

    September 30,1997. OPEN. 10:30 a.m. Full Committee. Markup. 
H.R. 1703 and H.R. 2571.

    October 8, 1997. OPEN. 10:00 a.m. Subcommittee on Health. 
Hearing. VHA's Risk Management Policy and Performance. (Serial 
No. 105-23)

    October 16, 1997. OPEN. 9:00 a.m. Chicago, Illinois. 
Subcommittee on Oversight and Investigations. Hearing. 
Formation of the VA Chicago Health Care System. (Serial No. 
105-24)

    October 23, 1997. OPEN. 9:30 a.m. Subcommittee on Oversight 
and Investigations. Hearing. Mismanagement Issues at the 
Charleston, South Carolina and Pittsburgh, Pennsylvania 
Veterans Affairs Medical Centers. (Serial No. 105-25)

    December 18, 1997. OPEN. 10:00 a.m. Thaddeus J. Dulski 
Federal Building. Buffalo, New York. Subcommittee on Benefits. 
Hearing. The Veterans' Transitional Housing Opportunities Act 
of 1997. (Serial No. 105-26)

    January 28, 1998. OPEN. 10:00 a.m. Subcommittee on 
Oversight and Investigations. Hearing. Hearing To Examine 
Arlington National Cemetery Burial Waivers. (Serial No. 105-27)

    February 4 and February 12, 1998. OPEN. 10:00 a.m. Full 
Committee. Hearing. Department of Veterans Affairs Budget 
Request for Fiscal Year 1999. (Serial No. 105-28)

    February 4, 1998. OPEN. 2:00 p.m. Subcommittee on Benefits. 
Hearing. Oversight of VA's Vocational Rehabilitation. (Serial 
No. 105-29)

    February 5, 1998. OPEN. 1:00 p.m. Full Committee. Hearing. 
Full Committee Hearing To Receive Updates on Research, 
Investigations, and Programs Involving Persian Gulf War 
Veterans' Illnesses. (Serial No. 105-30)

    February 24, 1998. OPEN. 10:30 a.m. Subcommittee on 
Benefits. Hearing. H.R. 3039, the Veterans' Transitional 
Housing Opportunities Act of 1997, and H.R. 3211, Enacting 
Eligibility Requirements for Burial at Arlington National 
Cemetery. (Serial No. 105-31)

    February 26,1998. OPEN. 9:30 a.m. House and Senate Veterans 
Affairs Committees. Joint Hearing. Room 345 Cannon HOB. The 
1998 legislative priorities of the Non Commissioned Officers 
Association, Paralyzed Veterans of America, Jewish War 
Veterans, Military Order of the Purple Heart and Blinded 
Veterans Association.

    March 3, 1998. OPEN. 9:30 a.m. House and Senate Veterans 
Affairs Committees. Joint Hearing. Room 345 Cannon HOB. The 
1998 legislative priorities of the Veterans of Foreign Wars.

    March 5, 1998. OPEN. Subcommittee on Benefits. Markup. H.R. 
3039, H.R. 3211 and H.R. 3213.

    March 11, 1998. OPEN. 1:00 p.m. Full Committee. Markup. 
H.R. 3039, H.R. 3211 and H.R. 3213.

    March 18, 1998. OPEN. 9:30 a.m. House and Senate Veterans 
Affairs Committees. Joint Hearing. Room 345 Cannon HOB. The 
1998 legislative priorities of the Disabled American Veterans.

    March 18, 1998. OPEN. 12:30 p.m. Full Committee. Meeting. 
To approve the Committee's views and estimates of the fiscal 
year 1999 budget to be submitted to the Budget Committee.

    March 18, 1998. OPEN. 2:00 p.m. Subcommittee on Oversight 
and Investigations. Hearing. Department of Veterans Affairs 
Participation in the Federal Energy Management Program. (Serial 
No. 105-32)

    March 19, 1998. OPEN. 9:45 a.m. Subcommittee on Health. 
Markup. Fiscal Year 1999 construction authorization.

    March 19, 1998. OPEN. 10:00 a.m. Subcommittee on Health. 
Hearing. Quality Management at the Veterans Health 
Administration. (Serial No. 105-33)

    March 25, 1998. OPEN. 9:30 a.m. House and Senate Veterans 
Affairs Committees. Joint Hearing. Room 345 Cannon HOB. The 
1998 legislative priorities of The Retired Officers 
Association, Vietnam Veterans of America, American Ex-POWs and 
AMVETS.

    March 25, 1998. OPEN. 1:00 p.m. Full Committee. Markup. 
H.R. 3603.

    March 26, 1998. OPEN. 10:00 a.m. Subcommittee on Benefits. 
Hearing. Hearing To Review the Department of Veterans Affairs' 
Compliance With the Requirements of the Government Performance 
and Results Act. (Serial No. 105-34)

    April 23, 1998. OPEN. 9:30 a.m. Subcommittee on Health. 
Hearing. Hearing on War-related Illnesses and on the VA's 
Sexual Trauma Counseling Program. (Serial No. 105-35)

    April 29, 1998. OPEN. 10:00 a.m. Subcommittee on Benefits. 
Hearing. Operations within the National Cemetery System (NCS). 
(Serial No. 105-36).

    May 14, 1998. OPEN. 9:30 a.m. Subcommittee on Oversight and 
Investigations. Hearing. Hearing on GAO Report on VA Inspector 
General Special Inquiry Regarding Patient Deaths at the VA 
Hospital in Columbia, Missouri, and on VA Quality Assurance 
Improvement. (Serial No. 105-37)

    May 20, 1998. OPEN. 10:00 a.m. Subcommittee on Benefits and 
Subcommittee on Government Programs, Committee on Small 
Business. Joint Hearing. Government Programs and Oversight of 
the Small Business Committee and the Subcommittee on Benefits 
of the Committee on Veterans' Affairs. (Serial No. 105-38)

    June 4, 1998. OPEN. 1:00 p.m. Subcommittee on Health. 
Markup. H.R. 3980, H.R. 2775 and H.R. 3336.

    June 10, 1998. OPEN. 2:00 p.m. Subcommittee on Benefits. 
Hearing. Operations of the Board of Veterans' Appeals and Court 
of Veterans Appeals, and review of H.R. 3212, with Respect To 
the Court of Veterans Appeals Retirement Plan. (Serial No. 105-
39)

    June 17, 1998. OPEN. 10:00 a.m. Subcommittee on Health. 
Hearing. Future Role of the VA Health Care System. (Serial No. 
105-40)

    June 18, 1998. OPEN. 10:00 a.m. Subcommittee on Benefits. 
Hearing. Draft Legislation to Provide a Cost-of-Living 
Adjustment in Rates of Compensation Paid to Veterans with 
Service-connected Disabilities to make various Improvements in 
Education, Housing and Cemetery Programs of the Department of 
Veterans Affairs, and for other purposes. (Serial No. 105-41)

    June 24, 1998. OPEN. 10:15 a.m. Full Committee. Markup. 
H.R. 3980 and H.R. 4110.

    June 30, 1998. OPEN. 10:30 a.m. Gold Room, State Capitol, 
Boise, Idaho. Subcommittee on Health. Hearing. Review Provision 
of Care to Idaho's Veterans. (Serial No. 105-42)

    July 16, 1998. OPEN. 10:00 a.m. Subcommittee on Benefits. 
Hearing. Standards for Adjudicating Claims presented by 
Veterans suffering from Hepatitis C, Cerebral Malaria and 
Persian Gulf Illnesses. (Serial No. 105-43)

    July 22, 1998. OPEN. 10:00 a.m. Full Committee. Hearing. 
Benefits for Filipino Veterans. (Serial No. 105-44)

    July 23, 1998. OPEN. 9:30 a.m. Subcommittee on Health. 
Hearing. Hearing to Review the Provision of Specialized 
Services at the Department of Veterans Affairs and 
Rehabilitative Needs of Disabled Veterans. (Serial No. 105-45)

    August 5, 1998. OPEN. 10:00 a.m. Full Committee. Hearing. 
Garnishment of Benefits paid to Veterans for Child Support and 
other Court-ordered Obligations. (Serial No. 105-46)

    September 24, 1998. OPEN. 9:30 a.m. Subcommittee on 
Oversight and Investigations. Hearing. Year 2000 (Y2K) medical 
device issues and their impact on the Department of Veterans 
Affairs. (Serial No. 105-47)
                      LEGISLATION ENACTED INTO LAW

                           Public Law 105-67

                             (H.J. RES. 75)

    Title: An Act to confer status as an honorary veteran of 
the United States Armed Forces on Leslie Townes (Bob) Hope.
    Summary: H.J. Res. 75:
    1. Extends the gratitude of the American people to 
entertainer Leslie Townes (Bob) Hope.
    2. Confers upon Bob Hope the status of honorary veteran 
for his lasting contribution to American society by 
entertaining this nation's troops overseas from World War II 
through the Persian Gulf War.
    Effective date: Date of enactment
    Cost: The Congressional Budget Offices estimates that the 
cost of H.J. Res. 75 would have no effect on the federal budget 
and would not affect direct spending or receipts. H.J. Res. 75 
contains no intergovernmental or private-sector mandates as 
defined in the Unfunded Mandates Reform Act of 1995 and would 
not affect the budgets of state, local, or tribal governments.
    Legislative history
    May 21, 1997: H.J. Res. 75 reported favorably by Committee 
on Veterans' Affairs.
    June 3, 1997: H.J. Res. 75 reported by Committee on 
Veterans' Affairs. H.Rept. 105-109.
    June 3, 1997: Passed the House under suspension by voice 
vote.
    June 4, 1997: Referred to the Senate Committee on Veterans' 
Affairs.
    Sep. 9, 1997: Passed the Senate by unanimous consent.
    Oct. 30, 1997: Signed by the President, Public Law 105-67.
                                ------                                


      VETERANS' COMPENSATION COST-OF-LIVING ADJUSTMENT ACT OF 1997

                           Public Law 105-98

                        (H.R. 2367, AS AMENDED)

    Title: An Act to increase, effective as of December 1, 
1997, the rates of compensation for veterans with service-
connected disabilities and the rates of dependency and 
indemnity compensation for the survivors of certain disabled 
veterans.
    Summary: H.R. 2367:
    1. Increases, effective December 1, 1997, the rates of 
compensation for veterans with service-connected disabilities 
and the rates of dependency and indemnity compensation for the 
survivors of certain disabled veterans. The rate of increase 
would follow Social Security Administration figures.
    2. Rounds down, to the next lower dollar amount, all 
compensation and DIC benefits when the amount is not a whole 
dollar amount.

          COMPENSATION AND DIC RATES EFFECTIVE DECEMBER 1, 1997
------------------------------------------------------------------------
                                                 Increase (monthly rate)
                                               -------------------------
                                                    From          To
------------------------------------------------------------------------
Percentage of disability or subsection under which payment
 is authorized:
    (a)               10 percent..............          $94          $95
    (b)               20 percent..............          179          182
    (c)               30 percent..............          274          279
    (d)               40 percent..............          391          399
    (e)               50 percent..............          558          569
    (f)               60 percent..............          703          717
    (g)               70 percent..............          887          905
    (h)               80 percent..............        1,028        1,049
    (i)               90 percent..............        1,157        1,181
    (j)               100 percent.............        1,924        1,964
Higher statutory awards for certain multiple disabilities:
    (k)               (1) Additional monthly             74           75
                       payment for anatomical
                       loss, or loss of use
                       of, any of the
                       following: one foot,
                       one hand, blindness in
                       one eye (having light
                       perception only), one
                       or more creative
                       organs, both buttocks,
                       organic aphonia (with
                       constant inability to
                       communicate by speech),
                       deafness of both ears
                       (having absence of air
                       and bone conduction)--
                       for each loss.
                      (2) Limit for veterans          2,393        2,443
                       receiving payments
                       under (a) to (j) above.
                      (3) Limit for veterans          3,356        3,426
                       receiving benefits
                       under (l) to (n) below.
    (l)               Anatomical loss or loss         2,393        2,443
                       of use of both feet,
                       one foot and one hand,
                       blindness in both eyes
                       (5/200) visual acuity
                       or less), permanently
                       bedridden or so
                       helpless as to require
                       aid and attendance.
    (m)               Anatomical loss or loss         2,639        2,694
                       of use of both hands,
                       or of both legs, at a
                       level preventing
                       natural knee action
                       with prosthesis in
                       place or of 1 arm and 1
                       leg at a level
                       preventing natural knee
                       or elbow action with
                       prosthesis in place or
                       blind in both eyes,
                       either with light
                       perception only or
                       rendering veteran so
                       helpless as to require
                       aid and attendance.
Percentage of disability or subsection under which payment
 is authorized:
    (n)               Anatomical loss of both         3,003        3,066
                       eyes or blindness with
                       no light perception or
                       loss of use of both
                       arms at a level
                       preventing natural
                       elbow action with
                       prosthesis in place or
                       anatomical loss of both
                       legs so near hip as to
                       prevent use of
                       prosthesis, or
                       anatomical loss of 1
                       arm and 1 leg so near
                       shoulder and hip to
                       prevent use of
                       prosthesis.
    (o)               Disability under                3,356        3,426
                       conditions entitling
                       veterans to two or more
                       of the rates provided
                       in (1) through (n), no
                       condition being
                       considered twice in the
                       determination, or
                       deafness rated at 60
                       percent or more
                       (impairment of either
                       or both ears service-
                       connected) in
                       combination with total
                       blindness (5/200 visual
                       acuity or less) or
                       deafness rated at 40
                       percent or total
                       deafness in one ear
                       (impairment of either
                       or both ears service-
                       connected) in
                       combination with
                       blindness having light
                       perception only or
                       anatomical loss of both
                       arms so near the
                       shoulder as to prevent
                       use of prosthesis.
    (p)               (1) If disabilities             3,356        3,426
                       exceed requirements of
                       any rates prescribed,
                       Secretary of Veterans
                       Affairs may allow next
                       higher rate or an
                       intermediate rate, but
                       in no case may
                       compensation exceed.
                      (2) Blindness in both           3,356        3,426
                       eyes (with 5/200 visual
                       acuity or less)
                       together with (a)
                       bilateral deafness
                       rated at 30 percent or
                       more disabling
                       (impairment of either
                       or both ears service-
                       connected) next higher
                       rate is payable, or (b)
                       service-connected total
                       deafness of one ear or
                       service-connected loss
                       or loss of use of an
                       extremity the next
                       intermediate rate is
                       payable, but in no
                       event may compensation
                       exceed.
                      (3) Blindness with only         3,356        3,426
                       light perception or
                       less with bilateral
                       deafness (hearing
                       impairment in either
                       one or both ears is
                       service-connected)
                       rated at 10 or 20
                       percent disabling, the
                       next intermediate rate
                       is payable, but in no
                       event may compensation
                       exceed.
                      (4) Anatomical loss or          3,356        3,426
                       loss of use of three
                       extremities, the next
                       higher rate in
                       paragraphs (l) to (n)
                       but in no event in
                       excess of.
    (q)               [This subsection
                       repealed by Public Law
                       90-493.].
    (r)               (1) If veteran entitled         1,441        1,471
                       to compensation under
                       (o) or to the maximum
                       rate under (p); or at
                       the rate between
                       subsections (n) and (o)
                       and under subsection
                       (k), and is in need of
                       regular aid and
                       attendance, he shall
                       receive a special
                       allowance of the amount
                       indicated at right for
                       aid and attendance in
                       addition to such rates.
                      (2) If the veteran, in          2,145        2,190
                       addition to need for
                       regular aid and
                       attendance is in need
                       of a higher level of
                       care, a special
                       allowance of the amount
                       indicated at right is
                       payable in addition to
                       (o) or (p) rate.
    (s)               Disability rated as             2,154        2,199
                       total, plus additional
                       disability
                       independently ratable
                       at 60 percent or over,
                       or permanently
                       housebound.
    (t)               [This subsection
                       repealed by Public Law
                       99-576.].
------------------------------------------------------------------------

    In addition to basic compensation rates and/or statutory 
awards to which the veteran may be entitled, dependency 
allowances are payable to veterans who are rated at not less 
than 30 percent disabled. The rates which follow are those 
payable to veterans while rated totally disabled. If the 
veteran is rated 30, 40, 50, 60, 70, 80 or 90 percent disabled, 
dependency allowances are payable in an amount bearing the same 
ratio to the amount specified below as the degree of disability 
bears to total disability. For example, a veteran who is 50 
percent disabled receives 50 percent of the amounts which 
appear below.

    COMPENSATION AND DIC RATES EFFECTIVE DECEMBER 1, 1997--Continued
------------------------------------------------------------------------
                                                 Increase (monthly rate)
                                               -------------------------
                                                    From          To
------------------------------------------------------------------------
If and while veteran is rated totally disabled
 and--
    Has a spouse..............................         $112         $114
    Has a spouse and child....................          191          195
    Has no spouse, 1 child....................           77           78
    For each additional child.................           59           60
    For each dependent parent.................           91           92
    For each child age 18-22 attending school.          177          180
    Has a spouse in nursing home or severely            211          215
     disabled.................................
    Has disabled, dependent adult child.......          177          180
------------------------------------------------------------------------

Dependency and Indemnity Compensation

    The rates of dependency and indemnity compensation payable 
with respect to service-related deaths occurring on and after 
January 1, 1993, (and payable with respect to any service-
connected death if payments based on a veteran's rank would 
result in a lesser payment) would be increased by 2.1 percent, 
from $833 to $850 for the base rate, and from $182 to $185 for 
the additional amount or ``kicker'' payable if the veteran 
suffered from a service-connected disability rated as totally 
disabling for a period of at least eight years immediately 
preceding death.

    The following table reflects increases provided for 
surviving spouses of deceased veterans whose service-connected 
deaths occurred prior to January 1, 1993, and who are not 
receiving dependency and (DIC) payments under the new rate 
structure at a higher rate:

------------------------------------------------------------------------
                                                 Increase (monthly rate)
                    Pay grade                  -------------------------
                                                    From          To
------------------------------------------------------------------------
E-7...........................................          861          879
E-8...........................................          909          928
E-9...........................................      \1\ 949      \1\ 968
W-1...........................................          880          898
W-2...........................................          915          934
W-3...........................................          943          962
W-4...........................................          997        1,017
O-1...........................................          880          898
O-2...........................................          909          928
O-3...........................................          972          992
O-4...........................................        1,028        1,049
O-5...........................................        1,132        1,155
O-6...........................................        1,276        1,302
O-7...........................................        1,378        1,406
O-8...........................................        1,510        1,541
O-9...........................................        1,618        1,651
O-10..........................................    \2\ 1,774        1,811
------------------------------------------------------------------------
\1\ If the veteran served as Sergeant Major of the Army, Senior Enlisted
  Advisor of the Navy, Chief Master Sergeant of the Air Force, Sergeant
  Major of the Marine Corps, or Master Chief Petty Officer of the Coast
  Guard, at the applicable time designated by section 1302 of this
  title, the surviving spouse's rate shall be $1,023.
\2\ If the veteran served as Chairman or Vice-Chairman of the Joint
  Chiefs of Staff, Chief of Staff of the Army, Chief of Naval
  Operations, Chief of Staff of the Air Force, Commandant of the Marine
  Corps or Commandant of the Coast Guard, at the applicable time
  designated by section 1302 of this title, the surviving spouse's rate
  shall be $1,902.

    When there is no surviving spouse receiving dependency and 
indemnity compensation, payment is made in equal shares to the 
children of the deceased veteran. These rates are increased as 
follows.

------------------------------------------------------------------------
                                                 Increase (monthly rate)
                                               -------------------------
                                                    From          To
------------------------------------------------------------------------
One child.....................................         $354         $361
Two children..................................          510          520
Three children................................          662          675
Each additional child.........................          130          132
------------------------------------------------------------------------

    Effective date: December 1, 1997
    Cost: The bill would have no budgetary effect relative to 
the baseline as modified by the Balanced Budget Act of 1997. 
The bill would affect direct spending and thus pay-as-you-go 
procedures would apply.
    Legislative history
    Sep. 11, 1997: H.R. 2367 ordered reported by Committee on 
Veterans' Affairs.
    Oct. 9, 1997: H.R. 2367 reported to the House. H. Rept. 
105-320.
    Oct. 31, 1997: Passed the House amended by voice vote by 
unanimous consent.
    Nov. 5, 1997: Passed the Senate by unanimous consent.
    Nov. 19, 1997: Signed by the President, Public Law 105-98.
                                ------                                


                           Public Law 105-111

                              (H.R. 1090)

    Title: An Act to amend title 38, United States Code, to 
allow revision of veterans benefits decisions based on clear 
and unmistakable error.
    Summary: H.R. 1090:
    1. Codifies the existing regulatory authority for appeal 
at the regional office on the grounds of clear and unmistakable 
error.
    2. Makes decisions made by the Board of Veterans' Appeals 
subject to revision on the grounds of clear and unmistakable 
error.
    3. Permits appeal to the Court of Veterans Appeals on the 
basis that there was a clear and unmistakable error in any 
previous Board decision.
    Effective date: Date of enactment
    Cost: The Congressional Budget Office estimates that the 
cost of H.R. 1090 would raise administrative costs over the 
first two or three years after enactment by $1 million to $2 
million in total, but in the longer run administrative costs 
would rise by less than $500,000 a year. In addition, CBO 
estimates that the bill would have a direct spending impact of 
less than $500,000 a year through 2002. Because the bill would 
raise direct spending, it would be subject to pay-as-you-go 
procedures. H.R. 1090 contains no intergovernmental or private-
sector mandates as defined in the Unfunded Mandates Reform Act 
of 1995 and would not affect the budgets of state, local, or 
tribal governments.
    Legislative history
    Mar. 20, 1997: H.R. 1090 ordered reported favorably by 
Committee on Veterans' Affairs.
    Apr. 14, 1997: H.R. 1090 reported by Committee on Veterans' 
Affairs. H. Rept. 105-52.
    Apr. 16, 1997: Passed the House under suspension by voice 
vote.
    Apr. 17, 1997: Referred to Senate Committee on Veterans' 
Affairs.
    Nov. 10, 1997: Passed the Senate by unanimous consent.
    Nov. 21, 1997: Signed by the President, Public Law 105-111.

                                ------                                


                     VETERANS' BENEFITS ACT OF 1997

                           Public Law 105-114

                          (S. 714, AS AMENDED)

    Title: An act to amend title 38, United States Code, to 
revise, extend, and improve programs for veterans.
    Summary: S. 714, as amended:

Title I

    1. Directs the Secretary of Veterans Affairs to establish 
a new VA employment discrimination complaint resolution system.
    2. Establishes a quasi-independent VA Office of Employment 
Discrimination Complaint Adjudication which would make final 
agency decisions on substantive equal employment opportunity 
issues.
    3. Requires the Secretary of Veterans Affairs to contract 
with a private entity to assess VA's discrimination complaint 
resolution system.

Title II

     1. Clarifies that a Persian Gulf veteran is eligible for 
VA health care by virtue of having a condition associated with 
service in the Gulf.
     2. Requires VA to create a competitive grant program 
under which up to ten VA facilities would establish 
demonstration projects to improve care to Persian Gulf veterans 
with undiagnosed or difficult to diagnose conditions.
     3. Extends VA's authority to provide direct loans to 
Native Americans to purchase, construct, renovate, or refinance 
homes on trust land through December 31, 2001, and add outreach 
and reporting requirements.
     4. Codifies into a single section of title 38--and 
extends--expiring (and partially overlapping) authorities and 
statutory responsibilities to serve homeless veterans under 
which VA provides (directly or by contract) halfway houses and 
other residential care to homeless, chronically mentally ill 
veterans; establish and provide therapeutic transitional 
housing for veterans participating in compensated work therapy 
programs; provide community-based halfway house care under 
contract for veterans suffering from drug and alcohol 
dependence; and require VA at the facility level (to the extent 
resources permit) to meet the needs of homeless veterans 
identified in a community assessment process.
     5. Extends, through December 31, 1999, VA's authority to 
sell, lease, or donate VA properties to nonprofit organizations 
or a State or political subdivision of a State for the purpose 
of assisting homeless veterans and their families acquire 
shelters.
     6. Extends the Homeless Veterans Comprehensive Service 
Grant Program, which enables the VA to provide grant support to 
public and non-profit agencies and entities to establish 
programs to assist homeless veterans, through September 30, 
1999.
     7. Extends, through December 31, 1999, the Department of 
Labor's authority to operate the Homeless Veterans 
Reintegration Project (HVRP), which provides grants to 
community-based organizations focusing on returning homeless 
veterans to the workforce, and authorize $10,000,000 per year.
     8. Expands the scope of the report requirement regarding 
VA assistance to homeless veterans by requiring an evaluation 
of both VA programs and those established under the VA's 
Homeless Veterans Comprehensive Service Grant Program.
     9. Extends VA's authority to enter into long-term leases 
with parties to enhance unused or underused VA property through 
December 31, 2001 and repeal the current limitations on the 
number of enhanced-use leases which VA may enter under such 
authority.
    10. Makes permanent the VA's authority to provide 
noninstitutional alternatives to nursing home care, such as 
hospital-based home care, adult day health care, and community 
residential care.
    11. Extends the Health Professional Scholarship Program 
through December 31, 1998 and requires the VA to report within 
six months on the effectiveness of the program and alternative 
approaches to recruitment and retention of health 
professionals.
    12. Requires the VA to develop a national policy with 
respect to breast cancer screening for veterans.
    13. Requires the President, by March 1, 1998, to submit to 
Congress a report on plans, preparations and the capability of 
all levels of government to respond nationally to medical 
emergencies arising from the terrorist use of weapons of mass 
destruction.

Title III

     1. Authorizes the following major medical construction 
projects:

        a) Lseismic corrections at the Department of Veterans 
        Affairs medical center in Memphis, Tennessee;
        b) Lseismic corrections and clinical and other 
        improvements at the McClellan Hospital at Mather Field, 
        Sacramento California; and
        c) Loutpatient improvements at Mare Island, Vallejo, 
        California, and Martinez, California.

     2. Authorizes major medical facility leases of 
information resources management field offices in Birmingham, 
AL and Salt Lake City, UT; and satellite outpatient clinics in 
Jacksonville, FL; Boston MA; Canton, OH; Portland, OR; and 
Tulsa, OK.
     3. Authorizes appropriations of $34.6 million for the 
Construction, Major Projects account for construction at the 
Memphis VAMC and $15.703 million for the Medical Care account 
for the major medical leases.
     4. Specifies that major construction projects in northern 
California authorized in the bill must be carried out using 
previously appropriated funds.

Title IV

     1. Makes a number of technical and clarifying amendments 
improving existing educational programs under chapters 30, 34, 
and 36 and a clerical correction to chapter 23 regarding burial 
benefits.
     2. Clarifies that a veteran discharged or released from 
active service due to a disability, without regard to any prior 
determination as to the degree of such disability, may be 
furnished VA hospital care and medical services.
     3. Clarifies that ``category C'' veterans under VA 
treatment are eligible for the one-time $1200 home improvement/
structural alteration benefit.
     4. Strikes the limitation in current law which restricts 
VA transfers and placements into community nursing homes to 
veterans receiving inpatient care, and would authorize such 
needed placements for any veteran under care in a VA facility.
     5. Changes the name of the Wm. Jennings Bryan Dorn 
Veterans' Hospital to the ``Wm. Jennings Bryan Dorn Department 
of Veterans Affairs Medical Center''.
     6. Makes clarifying changes to the definition of 
``child'' and ``Vietnam veteran'' as these terms are used in 
provisions of current law providing benefits to children of 
Vietnam veterans with a birth defect called spina bifida.

    Effective date: Upon enactment, except the spina bifida 
provision (Section 404), which is effective on October 1, 1997.
    Legislative history
    Apr. 16, 1997: H.R. 1092 passed the House under suspension 
by voice vote.
    Oct. 6, 1997: H.R. 1703 passed the House under suspension 
by voice vote.
    Oct. 6, 1997: H.R. 2206 passed the House amended under 
suspension by voice vote.
    Oct. 6, 1997: H.R. 2571 passed the House under suspension 
by voice vote.
    Oct. 7, 1997: S. 986 ordered reported amended by the Senate 
Veterans' Affairs Committee.
    Oct. 7, 1997: S. 801 ordered reported amended by the Senate 
Veterans' Affairs Committee.
    Oct. 7, 1997: S. 999 ordered reported by the Senate 
Veterans' Affairs Committee.
    Oct. 30, 1997: S. 714 reported to the Senate. S. Rpt. 105-
123.
    Nov. 5, 1997: S. 714 passed the Senate with an amendment 
and an amendment to the Title by unanimous consent.
    Nov. 9, 1997: S. 714 passed the House amended under 
suspension by voice vote (consists of certain provisions from 
H.R. 1092, H.R. 1703, H.R. 2206, H.R. 2571, S. 986, S. 801, and 
S. 999)
    Nov. 10, 1997: S. 986 reported to the Senate. S. Rpt. 105-
153.
    Nov. 10, 1997: Senate agreed to the House amendments by 
unanimous consent.
    Nov. 21, 1997: Signed by the President, Public Law 105-114.
                                ------                                


                           Public Law 105-116

                          (S. 923, AS AMENDED)

    Title: An Act to amend title 38, United States Code, to 
prohibit interment or memorialization in certain cemeteries of 
persons committing Federal or State capital crimes.
    Summary: S. 923, as amended:
    1. Denies persons described in paragraph 2 burial or 
memorialization in a cemetery under the jurisdiction of the 
Department of Veterans Affairs, Arlington National Cemetery, or 
any state veterans cemetery for which a state receives a VA 
grant on or after date of enactment.
    2. Applies to anyone convicted of a federal capital crime 
or a state capital crime in which one or more deaths occur.
    3. Applies only when VA is notified by the Attorney 
General or the appropriate state official of the person's 
conviction prior to approval of a request for burial.
    4. Authorizes the Secretary of VA, the Secretary of the 
Army, and the appropriate state official to administratively 
deny burial or memorialization to persons not convicted due to 
death or flight to avoid prosecution.
    Effective date: Applies to applications for memorialization 
or interment made on or after the date of enactment.
    Cost: The Congressional Budget Office estimates that S. 
923, as amended, would reduce burial costs, but would apply to 
only a few people every year. Therefore, reductions in 
mandatory spending would be negligible.
    Legislative history
    June 18, 1997: Senate Committee on Veterans Affairs 
discharged by unanimous consent.
    June 18, 1997: Passed the Senate amended by vote of 98-0.
    June 19, 1997: Referred to the House Committee on Veterans' 
Affairs.
    Oct. 9, 1997: S. 923 reported to the House amended. H. 
Rept. 105-319.
    Oct. 31, 1997: Passed the House amended by voice vote by 
unanimous consent.
    Nov. 10, 1997: Senate agreed to House amendments by 
unanimous consent.
    Nov. 21, 1997: Signed by the President, Public Law 105-116.
                                ------                                


               VETERANS PROGRAMS ENHANCEMENT ACT OF 1998

                           Public Law 105-368

                              (H.R. 4110)

    Title: An Act to amend title 38, United States Code, to 
improve benefits and services provided to Persian Gulf War 
veterans, to provide a cost-of-living adjustment in rates of 
compensation paid to veterans with service-connected 
disabilities, to enhance programs providing health care, 
compensation, education, insurance, and other benefits for 
veterans, and for other purposes.
    Summary: H.R. 4110, as amended:

Title I - Provisions relating to veterans of Persian Gulf War and 
        future conflicts

     1. Provides for the National Academy of Sciences (NAS) or 
similar organization to review and evaluate the available 
scientific evidence and determine whether there is scientific 
evidence of an association between illnesses experienced by 
Gulf War veterans and service in--or exposure to one or more 
agents, hazards, medicines, or vaccines during --the Persian 
Gulf War.
     2. Establishes authority for VA to provide priority 
health care to treat illnesses that may be attributable to a 
veteran's service in combat during any period of war after the 
Persian Gulf War or during any other future period of 
hostilities (notwithstanding that there is insufficient medical 
evidence to conclude that such illnesses are attributable to 
such service).
     3. Extends VA's special authority to provide care to 
Persian Gulf veterans through December 31, 2001.
     4. Requires VA to enter into an agreement with the 
National Academy of Sciences or another appropriate independent 
organization to assist in developing a plan for the 
establishment of a national center for the study of war-related 
illnesses and post-deployment health issues.
     5. Requires VA to establish a public advisory committee 
(to include veterans of the Persian Gulf War) to provide advice 
to the Secretaries of Veterans Affairs, Health and Human 
Services, and Defense on proposed research studies, research 
plans, or research strategies relating to the health of Persian 
Gulf veterans.
     6. Requires Departments of Veterans Affairs, Health and 
Human Services, and Defense to report to Congress by March 1 of 
each year the status and results of such research activities, 
along with the list of research priorities for the upcoming 
year.
     7. Requires public availability through the World Wide 
Web and elsewhere of the findings of all Persian Gulf research 
conducted by or for the Government.
     8. Requires VA to enter into an agreement with the 
National Academy of Sciences to determine whether there is a 
methodology by which VA could determine the efficacy of 
treatments provided to Persian Gulf War veterans for illnesses 
which may be associated with their Persian Gulf War service.
     9. Requires VA and DoD to enter into an agreement with 
the National Academy of Sciences to (a) develop a curriculum 
(to take account of new research findings relating to care of 
veterans with illnesses that may be associated with Persian 
Gulf War services) for use in continuing education of VA and 
DoD physicians.
    10. Extends VA's authority to evaluate the health status 
of spouses and children of Persian Gulf War veterans through 
December 31, 1999, and to provide such examinations through VA 
facilities, or under its fee-basis or other contract 
arrangements.

Title II - Education and Employment

     1. Changes the way VA calculates the reporting fee paid 
to educational institutions that enroll veterans.
     2. Makes optional, rather than mandatory, an advance 
payment of 40 percent of the amount that veteran-students under 
VA's work-study program are eligible to receive for their 
veteran-related work. Current law requires the advanced 
payment.
     3. Allows servicemembers to use college-granted credit 
hours for life experiences as a means of meeting eligibility 
requirements for their Montgomery GI Bill benefits.
     4. Allows veteran-students in flight training to continue 
to receive VA educational assistance if they inadvertently fail 
to maintain the required flight certificate.
     5. Waives the wage increase and minimum salary 
requirements for on the job training programs provided by State 
and local governments.
     6. Requires the VA and military service branches to 
expand outreach services concerning VA education program 
requirements to members of the armed services.
     7. Requires the VA and military service branches to 
ensure that separating servicemembers are well informed of the 
eligibility requirements for their education benefits.
     8. Clarifies the enforcement of veterans' employment and 
reemployment rights with respect to a State (as an employer), 
under the Uniformed Service Employment and Reemployment Rights 
Act.
     9. Extends veterans' employment and reemployment rights 
to former members of the uniformed services employed overseas 
by United States companies.
    10. Clarifies Federal employee enforcement of employment 
and reemployment rights.

Title III - Compensation, Pension and Insurance

    1. Increases the special pension provided to persons 
entered and recorded on the Army, Navy, Air Force, and Coast 
Guard Medal of Honor Roll from $400 to $600 per month.
    2. Provides for the payment of accelerated death benefits 
to terminally ill persons under the Servicemembers' Group Life 
Insurance and Veterans' Group Life Insurance policies.
    3. Directs VA to provide to Congress an assessment of the 
effectiveness and adequacy of insurance and benefits programs 
for the survivors of veterans with service-connected 
disabilities.
    4. Authorizes the VA to issue dividends to the holders of 
World War II-era National Service Life Insurance (NSLI) series 
``H'' policies. All other NSLI policies issue dividends.

Title IV - Memorial Affairs

    1. Authorizes VA to furnish a memorial marker for certain 
members of the armed forces and spouses whose remains are 
unavailable for interment.
    2. Extends eligibility for burial in National Cemeteries 
and funeral benefits to veterans of the Merchant Marine who 
served from August 16, 1945, to December 31, 1946.
    3. Redesignates the National Cemetery System (NCS) as the 
National Cemetery Administration, and redesignate the Director 
of the National Cemetery System as the Under Secretary for 
Memorial Affairs.
    4. Modifies the existing State Cemetery Grants Program to 
authorize VA to pay up to 100 percent of the cost of 
constructing and equipping state veterans' cemeteries.

Title V - Court of Veterans Appeals

    1. Allows a sitting judge at the Court of Veterans Appeals 
nominated for a second term to remain on the bench for up to 
one year while awaiting Senate confirmation.
    2. Exempts the Court's retirement fund from sequestration 
orders.
    3. Provides the same adjustments for annuities to the 
survivors of deceased Court of Veterans Appeals judges as those 
received by Judiciary Survivors' Annuities Fund annuitants.
    4. Directs the Court to submit a report on the feasibility 
of merging the retirement and survivor annuity plans with other 
federal court retirement and survivor annuity programs.
    5. Renames the Court of Veterans Appeals the United States 
Court of Appeals for Veterans Claims.

Title VI - Housing

    1. Authorizes the Secretary of Veterans Affairs to 
guarantee loans to provide multifamily transitional housing for 
homeless veterans.
    2. Requires the Secretary to provide in the budget a 
simple, concise, and readily understandable statement that 
summarizes the financial activity of each of the housing 
programs operated under the Loan Guaranty Revolving Fund and 
the Guaranty and Indemnity Fund.
    3. Extends the VA's authority to guarantee home loans for 
members of the National Guard and Reserve components to 
September 30, 2003.
    4. Requires the Department of Veterans Affairs to comply 
with the requirements of the Competition in Contracting Act and 
the Federal Acquisition Regulations for any contract for 
services or supplies for properties acquired under the VA 
housing program.

Title VII - Construction and Facilities matters

     1. Authorizes appropriations for fiscal years 1999 and 
2000 in the amount of $241.1 million for the Construction, 
Major Projects account and $8.5 million for the Medical Care 
account for major medical leases.
     2. Authorizes major medical facility projects at the Long 
Beach VAMC ($23.2 million); the San Juan VAMC ($50 million); 
the Washington, DC VAMC ($28.7 million); the Palo Alto VAMC 
($22.4 million); the Cleveland (Wade Park) VAMC ($28.3 million, 
of which $7.5 million would come from previously appropriated 
funds); the Tucson VAMC ($35 million); the Dallas VAMC ($24.2 
million); projects at Auburn and Merced, California ($3 million 
from previously appropriated funds); the Lebanon VAMC ($9.5 
million); the Tampa VAMC ($46.3 million, of which $20 million 
would come from previously appropriated funds); and the Denver 
VAMC ($13 million, of which $11.9 million would come from 
previously appropriated funds in the Parking Revolving Fund).
     3. Authorizes major medical facility leases at satellite 
outpatient clinics in Baton Rouge, Louisiana ($1.8 million); 
Daytona Beach, Florida ($2.6 million); and Oakland Park, 
Florida ($4.1 million).
     4. Increases the threshold for treatment of a medical 
facility lease as a major medical facility lease (which 
requires congressional authorization) from $300,000 to 
$600,000.
     5. Increases the threshold for treatment of a parking 
facility project as a major medical facility project (which 
requires congressional authorization) from $3 million to $4 
million.
     6. Prohibits VA from establishing or collecting parking 
fees at any parking facility associated with the Spark M. 
Matsunaga VAMC and Regional Office in Honolulu, Hawaii.
     7. Requires VA to submit a report to Congress by 
September 15, 1999 on the Department's use of its authority to 
charge parking fees at VA medical facilities, to include the 
results of a survey on the availability of VA-provided 
employee-parking, an analysis of ways to provide cost-effective 
parking programs, and recommendations on whether and how to 
amend current law pertaining to parking fees.
     8. Requires VA to submit a report to Congress on a master 
plan relating to Department lands at the West Los Angeles VAMC.
     9. Designates the Aspinwall, PA VAMC as the ``H. John 
Heinz III Department of Veterans Affairs Medical Center''.
    10. Designates the Gainesville, FL VAMC as the ``Malcom 
Randall Department of Veterans Affairs Medical Center''.
    11. Designates the Columbus, OH VA Outpatient Clinic as 
the ``Chalmers P. Wylie Veterans Outpatient Clinic''.

Title VIII - Health Professionals Educational Assistance

    Scholarship Program

    1. Authorizes VA to carry out an employee-incentive 
scholarship program through December 31, 2001, to assist in 
meeting the staffing needs for health professional positions 
for which it is difficult to recruit or retain qualified 
personnel.
    2. Specifies that to be eligible, individuals must have 
been a full-time or part-time Department employee for at least 
two years and have an exceptional employment record.
    3. Requires that scholarships awarded under the program 
would cover payment of tuition and other educational expenses 
of up to $10,000 per year for a full-time student participant.
    4. Specifies that participants who do not finish the 
agreed upon course of study are liable for damages.
    Education Debt Reduction Program
    1. Authorizes the VA to carry out an education debt 
reduction program through December 31, 2001, to assist in the 
recruitment of health care professionals for positions that are 
difficult to recruit and retain.
    2. Specifies that to be eligible, an individual must be a 
recently-hired VHA employee (less than six months) serving in a 
position for which recruitment or retention is difficult and 
still indebted for education or training in that position.
    3. Limits assistance to $6,000 for the first year of 
participation in the program; $8,000 for the second year; and 
$10,000 for the third.

Title IX - Miscellaneous Medical Care and Medical Administration 
        provisions

    1. Authorizes VA to provide priority health care for the 
treatment of cancer of the head or neck to veterans who can 
document nasopharyngeal radium irradiation treatment in 
service.
    2. Extends VA's authority to counsel and treat veterans 
for sexual trauma through December 31, 2001.
    3. Requires VHA to develop and apply job-performance 
standards to VA network directors and any other officials 
responsible for the allocation and management of resources 
relating to the requirement to maintain special disability 
programs.
    4. Provides ongoing authority to use pension funds above 
the $90 monthly limit for certain veterans receiving nursing 
home care for operating expenses of VA medical facilities.
    5. Requires the VA to submit a report to Congress by 
February 1, 1999 and February 1, 2000 assessing the current 
system of locality-based pay for nurses.
    6. Requires the VA to provide an annual report to Congress 
on the Department's activities relating to its preparation for 
and participation in a domestic medical response to an attack 
involving weapons of mass destruction.
    7. Permits the interim appointment of the Under Secretary 
for Health for service until July 1, 1999.

Title X - Other matters

    1. Requires that, except as specified in law, a facility, 
structure, or property (or major part of any facility, 
structure or property) of the Department be named for the 
geographic area where it is located.
    2. Provides reversion rights to attorney positions at the 
Board of Veterans' Appeals for civil service attorneys who are 
members of the Board of Veterans' Appeals and whose 
appointments to the Board are terminated.
    3. Affords the Board of Veterans' Appeals flexibility in 
scheduling hearings, and in considering and deciding appeals, 
so that unintended delays may be avoided.
    4. Changes the formula used by Department of Labor's 
Veterans Employment and Training Service to determine the 
number of Disabled Veterans Outreach Program Specialists 
(DVOPS) to reflect the working-age veteran population in each 
state.

Title XI - Cost-of-living adjustment

    Increases effective December 1, 1998, the rates of 
compensation for veterans with service-connected disabilities 
and the rates of dependency and indemnity compensation for 
survivors of certain disabled veterans.

    Effective date:
        Date of enactment except for the following:
        section 201: Calendar years beginning after December 
        31, 1998.
        section 202: On or after January 1, 1999.
        section 203: October 1, 1998.
        section 204: October 1, 1998.
        section 205: On or after October 1, 1998.
        section 206: 180 days after date of enactment.
        section 207: Subsection (a) and (b) take effect 120 
        days after date of enactment, subsection (c) takes 
        effect on or after January 1, 2000.
        section 213: October 13, 1994.
        section 302: 90 days after date of enactment.
        section 304: 90 days after date of enactment.
        Title V: First day of the first month beginning more 
        than 90 days after the date of enactment.
        section 604: After the end of the 60 day period 
        beginning on the date of enactment.

    Cost:

                                     Table 1. Estimated Budgetary Effects of Direct Spending Provisions in H.R. 4110
                                                    (Outlays by fiscal year, in millions of dollars)
--------------------------------------------------------------------------------------------------------------------------------------------------------
                    Section                                  Provision               1999   2000   2001   2002   2003   2004   2005   2006   2007   2008
--------------------------------------------------------------------------------------------------------------------------------------------------------
904                                              Veterans' Pensions...............      4      2      2      2      0      0      0      0      0      0
201                                              Reporting Fees Adjustment........      3      3      3      3      3      3      3      3      3      3
603                                              Home Loans for Reservists........      0    -\3    -\3    -\3    -\3      0      0      0      0      0
205                                              On-the-Job Training Programs.....      2      2      2      2      2      2      2      2      2      2
601                                              Transitional Housing.............      1      1      1      1      2      2      2      0      0      0
1101                                             Compensation COLA................      a      a      a      a      a      a      a      a      a      a
                                                     Total b......................     10      5      5      5      4      7      7      5      5      5
--------------------------------------------------------------------------------------------------------------------------------------------------------
a The costs of this provisions are already assumed in the CBO baseline, pursuant to section 257 of the Balanced Budget and Emergency Deficit Control
  Act; thus, it would have no costs relative to that baseline. Relative to current law, this provision would increase spending by $316 million in 1999
  and by $415 million a year thereafter.
b The act contains several other provisions that would, in aggregate, affect direct spending by less than $500,000 annually.

    Legislative history
    June 24, 1998: H.R. 4110 ordered reported favorably by the 
Committee on Veterans' Affairs.
    July 15, 1998: H.R. 4110 reported by the Committee on 
Veterans' Affairs. H. Rept. 105-627.
    August 3, 1998: Passed the House amended under suspension 
by voice vote.
    September 30, 1998: Passed the Senate in lieu of S. 2273 
with an amendment by unanimous consent.
    October 10, 1998: House agreed to Senate amendment with 
amendments pursuant to H. Res. 592 (consists of provisions 
derived from H.R. 1092, H.R. 3039, H.R. 3212, H.R. 3213, H.R. 
3603, H.R. 3980, S. 309, S. 414, S. 730, S. 1822, S. 2273 and 
S. 2358).
    October 21, 1998: Senate agreed to House amendments to 
Senate amendment by unanimous consent.
    November 11, 1998: Signed by the President.

                    ACTIVITIES OF THE SUBCOMMITTEES

                         Subcommittee on Health

    The Subcommittee on Health, renamed from the former 
Subcommittee on Hospitals and Health Care after the 104th 
Congress, has legislative and oversight jurisdiction over the 
Department of Veterans' Affairs' health care programs and the 
VA's health care delivery system.

                         Legislative Activities

First Session

    On March 20, 1997, the full Committee held a markup to 
consider H.R. 1092, legislation that included a provision to 
extend and expand the authority of the Secretary of Veterans 
Affairs to enter into enhanced-use leases for Department of 
Veterans Affairs property. The enhanced-use leasing program, 
which was established during the 102nd Congress, permits the VA 
to enter into long-term leases with private and other public 
entities to improve unused or underused VA property in a manner 
which would, at least in part, contribute to the VA's mission. 
It has proven to be effective in fostering public-private 
partnerships and in improving underutilized VA property, as 
well as in providing another funding stream for VA and its 
facilities.
    H.R. 1092 proposed to repeal a section in law that limited 
the number of enhanced-use leases VA may execute to ten per 
year and twenty over the life of the program. The bill also 
proposed to extend enhanced-use authority until December 31, 
2002. The pertinent provisions of H.R. 1092 were ultimately 
enacted except that under the law the authority was extended 
only until December 31, 2001. The provision is found in Section 
205 of Public Law 105-114.
    The subcommittee heard testimony on May 8, 1997, regarding 
three legislative proposals: H.R. 1362, VA-Medicare subvention 
legislation; draft legislation to permit VA to collect from 
third party payers; and draft legislation on physicians' 
special pay. Officials from the Congressional Budget Office, 
the Department of Veterans Affairs, and the Department of 
Health and Human Services--along with officials from most major 
veterans service organizations--testified on H.R. 1362.
    Dr. Kenneth Kizer, VA's Under Secretary for Health, 
expressed support both for H.R. 1362 and draft legislation to 
permit the VA to retain money it receives from third party 
insurers rather than having to deposit the funds into the 
Treasury under then current law. The Committee was instrumental 
in ensuring that cost recovery language similar to the draft 
bill was included in the Balanced Budget Act.
    This hearing represented the first of many times the 
Committee met during the 105th Congress to discuss the concept 
of ``Medicare subvention,'' an initiative advanced by the 
Committee to enable certain Medicare-eligible veterans to 
receive Medicare-covered health care benefits through VA (with 
the Medicare program reimbursing VA). For the first time, 
legislation to advance this initiative was taken up by other 
committees with jurisdiction and was adopted by the House. The 
course of this legislative action, while falling short of full 
passage, gives impetus to this issue as a legislative priority 
in the 106th Congress.
    Under current law, Medicare may not cover the cost of care 
provided by the VA health care system. Legislation marked up on 
May 15, 1997 by the Subcommittee on Health and May 21, 1997 by 
the full Committee would have overridden that limitation. That 
bill, H.R. 1362, would have created a three-year demonstration 
project in up to 12 geographically dispersed VA medical centers 
allowing the VA to be reimbursed by Medicare for the care of 
participating higher income ``category C'' Medicare-eligible 
veterans.
    H.R. 3828, the Veterans Medicare Access Improvement Act of 
1998, jointly developed by Rep. Bill Thomas (R-CA), the 
Chairman of the House Ways and Means Subcommittee on Health, 
and the Chairman of the VA Committee, was introduced in the 
second session. The House ultimately passed the provisions of 
that bill. (See Legislative Activities--Second Session.)
    After extensive oversight, the Subcommittee on Health on 
July 24, 1997, marked up an omnibus bill, H.R. 2206. The 
legislation included provisions to extend, consolidate and 
strengthen various VA homeless programs, and to improve VA 
health care provided to Persian Gulf War veterans. Those 
provisions called for VA to provide counseling to Persian Gulf 
veterans on the results of registry examinations, establish a 
grant program to support the creation of demonstration projects 
at up to ten VA facilities to improve care to Persian Gulf 
veterans, and clarify that Persian Gulf veterans are eligible 
for VA health care for any condition associated with service in 
the Gulf.
    Also, the bill would have exempted VHA personnel engaged in 
patient care activities or research, or supervision of patient 
care or research, from an Administration policy to reduce the 
number of middle managers in the federal government; clarified 
that VA alone could establish, operate and set prices at 
canteens and vending machines within VA medical facilities; 
authorized VA to permit certain retirement-eligible VA 
physicians and dentists to have their ``special pay'' credited 
in full, for annuity purposes; and provided that drugs listed 
on the Federal Supply Schedule may only be procured from that 
schedule by a Federal entity or other entity already provided 
for under law.
    The full Committee marked up the bill on September 11, 
1997, and reported it to the full House on October 2, 1997 (H. 
Report 105-293). Because of revised Congressional Budget Office 
projections, the physician ``special pay'' provision was 
stripped from the bill before it came to the House floor. 
Concerns regarding the canteen service provision also resulted 
in its being dropped.
    The full House passed the bill under suspension of the 
rules on October 6, 1997. Major provisions of H.R. 2206--
including the homeless and Persian Gulf provisions--were 
included in S. 714, which was signed into law on November 21, 
1997 (see summary of Public Law 105-114, p. 32).
    On September 30, 1997, the full Committee marked up H.R. 
2571, which authorized several VA major medical facility 
projects and major medical facility leases. The bill proposed 
to authorize projects which would make seismic corrections at 
the VAMC in Memphis, TN; seismic corrections and clinical and 
other improvements at the McClellan hospital at Mather Field, 
Sacramento, CA; and outpatient improvements at Mare Island, 
Vallejo, CA, and Martinez, CA. The outpatient projects were 
authorized in lieu of construction of an inpatient facility at 
Travis Air Force Base planned by the Administration to replace 
the Martinez VAMC, which was seismically damaged. Acute 
inpatient care beds at Martinez were subsequently closed. (The 
General Accounting Office concluded, however, that construction 
of such a project at Travis would be ill-advised and that lower 
cost alternatives should be explored.)
    The bill proposed authorization of major medical facility 
leases in Birmingham, AL; Salt Lake City, UT; Jacksonville, FL; 
Boston, MA; Canton, OH; Portland, OR; and Tulsa, OK. In all, 
H.R. 2571 proposed authorization of appropriations totaling 
$34.6 million in the Construction, Major Projects account and 
$15.03 million in the Medical Care account for the leases.
    H.R. 2571 passed the House by unanimous voice vote on 
October 6, 1997. Its provisions were subsequently incorporated 
into S. 714, which was signed into law on November 21, 1997 
(see summary of Public Law 105-114, p. 33).

Second Session

    During the second session of the 105th Congress, 
discussions with the Chairman of the House Ways and Means 
Subcommittee on Health produced legislation that expanded on 
the bill developed and reported by the VA Committee. That 
legislation, H.R. 3828, called for Medicare to reimburse VA (1) 
under a demonstration project for the care of participating 
``category C'' Medicare-eligible veterans and (2) under a 
program for the care of certain Medicare-eligible service-
connected and low-income veterans whose closest VA medical 
center is geographically remote or inaccessible. While the VA 
Committee did not formally take up this legislation, it 
overwhelmingly passed the Ways and Means Committee on May 14, 
1998.
    The language of H.R. 3828 was subsequently incorporated 
into H.R. 4567, the Medicare Home Health Care Interim Payment 
System Refinement Act of 1998, which passed the House on 
October 10, 1998. The Senate stripped the VA-Medicare 
subvention provisions of this bill before that body passed it.
    On March 19, 1998, the subcommittee marked up draft 
legislation to authorize VA major construction projects for FY 
1999. Among its provisions, the bill proposed to authorize 
projects at VAMCs in Long Beach, CA; San Juan, Puerto Rico; 
Washington, DC; Palo Alto (Menlo Park), CA; Cleveland (Wade 
Park), OH; Tucson, AZ; Dallas, TX; Auburn and Merced, CA; and 
Denver, CO. The bill also included language authorizing major 
medical facility leases in Baton Rouge, LA; Daytona Beach, FL; 
and Oakland Park, FL. Further, the bill proposed to increase 
the threshold for treatment of parking facility projects as 
major medical facility projects from $3 million to $4 million.
    Introduced as H.R. 3603, the legislation was marked up by 
the full Committee on April 1, 1998 and passed the House on May 
19, 1998. The provisions of the bill--along with language 
authorizing other VA construction projects--was included in 
H.R. 4110, which cleared Congress on October 21, 1998 and was 
signed into law on November 11, 1998. (See summary of Public 
Law 105-368, p. 39.)
    On April 23, 1998, the Subcommittee on Health held a 
hearing to review draft legislation relating to research on and 
treatment of war-related illnesses. Based on that hearing, the 
subcommittee chairman introduced H.R. 3980, the Persian Gulf 
War Veterans Health Care and Research Act of 1998. This bill 
proposed to set the stage for early treatment of war-related 
illnesses by authorizing the VA to provide priority health for 
such illnesses for veterans of future hostilities. Further, the 
bill moved to extend the VA's special authority to treat 
Persian Gulf veterans through December 31, 2001, and proposed 
to elevate the level of priority for access to VA health care 
for Persian Gulf veterans.
    The bill also proposed to require VA to establish a 
National Center for the Study of War-Related illnesses; require 
the VA to work with the National Academy of Sciences toward 
improving VA care of Persian Gulf veterans; require the VA to 
join with DOD to develop a curriculum to be used by VA and DOD 
physicians dealing with new Persian Gulf research findings; and 
require the establishment of a Persian Gulf public advisory 
committee, to include Persian Gulf veterans, to make 
recommendations on research priorities relating to Persian Gulf 
illnesses.
    The Subcommittee on Health marked up the bill on June 4, 
1998. The subcommittee also marked up two bills--H.R. 2775, to 
rename the Aspinwall (PA) VAMC after the late Senator H. John 
Heinz, and H.R. 3336, to rename the Gainesville (FL) VAMC after 
the outgoing director of the facility, Malcom Randall--on the 
same day. Subsequently, these two pieces of legislation were 
combined into H.R. 3980 and the package was marked up in full 
Committee on July 15, 1998. The legislation passed the House on 
August 3, 1998. The key elements of this bill--along with other 
provisions relating to Persian Gulf veterans--were incorporated 
into H.R. 4110, which passed Congress on October 21, 1998 and 
was signed into law on November 11, 1998. (See summary of 
Public Law 105-368, page 36.)

                           Oversight Hearings

First Session

    On February 11, 1997, the Full Committee held a hearing to 
review issues relating to Persian Gulf War veterans, focusing 
on the recently released report of the Presidential Advisory 
Committee on Gulf War Veterans' Illnesses (PAC). This hearing 
represented the first of five conducted in the 105th Congress 
dealing with the health of Persian Gulf veterans. Testifying at 
the hearing were officials from the PAC; the Institute of 
Medicine; the Departments of Veterans Affairs, Defense, and 
Health and Human Services; the Veterans of Foreign Wars; The 
American Legion; the Disabled American Veterans; and the 
National Gulf War Resource Center. Additionally, three Persian 
Gulf War veterans testified regarding their experiences in 
seeking care from VA.
    The PAC report provoked controversy in identifying stress 
as a likely, important contributing factor to the broad 
spectrum of illnesses being reported by Gulf War veterans. The 
PAC's testimony--and subsequent follow-up questions--dispelled 
assertions that the report's findings meant that the PAC had 
concluded that illnesses experienced by Gulf War veterans had 
no physiological basis.
    The testimony of the three Gulf War veterans brought into 
focus the problem these veterans continue to experience when 
seeking care at VA facilities. Too often, those treating Gulf 
War vets are dismissive of their symptoms. These witnesses also 
testified to access problems they encountered before being 
treated.
    Subsequently, Health Subcommittee Chairman Stearns 
introduced H.R 2206, which among other things included 
provisions to improve health care for Persian Gulf veterans and 
strengthen the research efforts relating to their illnesses 
(see summary of legislative activities, page 43 and Public Law 
105-114, page 32).
    On April 3, 1997, the Subcommittee on Health conducted a 
hearing in Gainesville, Florida to examine the impact of the 
Veterans Equitable Resource Allocation (VERA) system on 
Florida's veterans. Officials from the VA Department (including 
the VISN director and three directors of Florida VA medical 
centers); the Florida Department of Veterans Affairs; the 
Disabled American Veterans; Veterans of Foreign Wars; The 
American Legion; the County Veterans Service Officers 
Association; and the Paralyzed Veterans of America testified.
    The shift of veterans' population to the South, Southwest 
and West has precipitated the need to change the way VA 
allocates its health care dollars. Section 429 of Public Law 
104-204 required VA to develop a new resource allocation 
methodology. Consistent with that law, VERA, which represents 
that new methodology, brought more funds to Florida and other 
``sun-belt'' states.
    The witnesses expressed unanimous support for VERA. 
Witnesses contrasted VERA's impact to the funding methodology 
in preceding years. In prior years, funding allocations did not 
follow veteran migration, and facilities with declining numbers 
of patients continued to receive funding based on prior years' 
funding levels rather than the number of veterans treated and 
the complexity of required services. While there were questions 
as to whether VERA went far enough, each witness supported the 
concept.
    The subcommittee continues to support VERA, but is mindful 
of the concerns raised by members of Congress from states 
losing funding under the program. It recommends that further 
oversight on this issue take place in the 106th Congress.
    On April 16, 1997, the Subcommittee on Health and the 
Subcommittee on Oversight and Investigations held a joint 
hearing to ascertain the degree to which exposures to chemical 
warfare agents may have played a part in the illnesses suffered 
by Persian Gulf War veterans. In addition to reviewing policy 
regarding the handling of intelligence findings and enemy 
chemical ordinance, the hearing probed into events that took 
place during the Gulf War in Khamisiyah, a remote location in 
Iraq where chemical arms had been stored. Despite early DOD 
assertions to the contrary, some amount of toxic chemical gas 
was released as a result of U.S. Army demolition of the Iraqi 
bunker where the munitions were stored. Testifying at the 
hearing were officials from the DOD, the Central Intelligence 
Agency, the Department of the Army, The American Legion, and 
the National Gulf War Resource Center.
    The subcommittee's next hearing, on June 19, 1997, focused 
on the quality of care Persian Gulf veterans receive from VA. 
It was apparent through the testimony of the General Accounting 
Office and others that there remains general dissatisfaction 
among many Gulf War veterans with the care they receive. GAO 
interviewed dozens of veterans on this topic and found that at 
some facilities even modest expectations--such as timeliness in 
registry examinations and being told the results of their 
tests--are not being met. The VA acknowledged that some 
veterans were not happy with their care. This hearing further 
reinforced the Committee's position that a legislative remedy 
was needed to require VA to improve its care of Persian Gulf 
veterans. Such provisions were included in H.R. 2206 (see 
Legislative Activities, First Session, p. 43). The Committee 
recommends continued monitoring in the 106th Congress of the 
status of Persian Gulf veterans' illnesses and the care these 
veterans receive from the VA. (See Oversight plan, p. 72.)
    On July 10, 1997, the subcommittee held a hearing to gather 
the views of VA officials and others on the VA pharmacy 
program, as well as draft legislation dealing with homeless 
veterans and Persian Gulf War veterans (later to become H.R. 
2206).
    GAO and VA officials were asked to testify on how opening 
the VA-administered pharmaceutical federal supply schedule 
(FSS) to state and local entities would affect VA 
pharmaceutical costs. GAO testified that, while there is no way 
to predict the impact on federal drug prices, providing greater 
access to that schedule risks significant cost increases for VA 
pharmaceutical drugs, as the industry attempts to protect 
itself against revenue losses. The VA reported that expanding 
access to FSS prices would result in price increases such as it 
sustained following implementation of the Medicaid rebate drug 
pricing provisions in the Omnibus Budget Reconciliation Act of 
1990.
    The subcommittee agreed that substantial price increases 
were a very real possibility and included a provision in H.R. 
2206 to provide that drugs listed on the Federal Supply 
Schedule may only be procured from that schedule by a Federal 
entity or other entity already provided for under law.
    At that hearing, the subcommittee also heard testimony from 
the VA, clinicians, and advocates for homeless veterans on the 
experience under then-current legislation to assist homeless 
veterans. The Subcommittee also took testimony on provisions in 
draft legislation to extend and expand those programs. Each of 
the witnesses expressed support for these provisions. 
Additionally, the VA expressed support for the enactment of the 
three provisions in the draft bill dealing with Persian Gulf 
War veterans (see summary of Public Law 105-114, p. 32).
    On October 6, 1997, the subcommittee held a hearing to 
examine VHA's risk management policy and performance as it 
related to avoidable patient deaths at several VA facilities. 
This hearing explored the adequacy of VA policy, the extent of 
adherence to that policy, and means to strengthen policy and 
practice. Testifying at the hearing were VA Under Secretary for 
Health Kenneth Kizer, three directors at VA facilities where 
incidents occurred, an official from the VA Inspector General's 
office, and a professor at the Harvard School of Public Health 
who has conducted extensive studies on risk management 
practices.
    Dr. Kizer testified to the effect that the VA is doing more 
than private sector providers to ensure patient safety. 
Further, he claimed that VA has taken steps to better ensure 
that mistakes made -whether resulting in a death or not--would 
lead to findings that would prevent similar cases from 
occurring, what the VA calls ``lessons learned''. A new, more 
comprehensive risk management policy--not in effect when these 
incidents occurred--was instituted shortly before the hearing. 
VA has also subsequently joined a national patient safety 
initiative. Nevertheless, the subcommittee found substantial 
evidence of under-reporting of patient safety problems. It also 
discovered that for several years Central Office had not 
reviewed systemwide patient-incident data, as policy had long 
required.
    The subcommittee remains committed to ongoing oversight on 
quality assurance. In that regard, the Subcommittee convened a 
follow-up hearing on this subject on March 19, 1998 (see 
Oversight hearings, Second Session, below). Further oversight 
on these issues is recommended for the 106th Congress.

Second Session

    On February 5, 1998, the full Committee held a follow-up 
hearing to determine the progress VA and other federal agencies 
have made in conducting Persian Gulf-related research and to 
review the findings and recommendations of the Presidential 
Advisory Committee on Gulf War Illnesses (PAC). Witnesses at 
the hearing included officials from the VA, DOD, Institute of 
Medicine, General Accounting Office, and the PAC. This hearing 
helped lay the foundation for the development of legislation to 
improve VA research on Persian Gulf War illnesses.
    On March 19, 1998, the Subcommittee on Health held a 
follow-up hearing to re-examine VHA's quality management 
practices. Representatives from the VA, the VA's Inspector 
General's office, the Institute of Medicine (IOM) and the 
Nurses Organization of Veterans Affairs (NOVA) testified.
    The hearing probed the extent to which quality management 
efforts had improved since the establishment of new policies in 
the previous year. Subcommittee Chairman Stearns questioned the 
effectiveness of the VA's ``Lessons Learned'' database, which 
VA officials cited at the previous hearing as a way for all VA 
medical facilities to learn about mistakes and ways to 
institute safer practices. He also questioned the results 
achieved from VA's creation of boards and committees on quality 
management.
    Dr. Thomas Garthwaite, VA's Deputy Under Secretary for 
Health, responded that the VA had indeed improved, citing the 
new risk management policy and a decrease in mortality numbers 
at VA facilities. Dr. John Mather, Assistant Inspector General 
for Heath Care Inspections, agreed that sound policies had been 
established, but identified implementation problems, and 
continuing problems with the integrity of data used to make 
such assessments.
    This issue continues to be of importance to the Committee. 
It recommends continued review of quality-management and 
patient safety during the 106th Congress.
    On April 23, 1998, the subcommittee held a hearing to 
gather views on draft legislation regarding war-related 
illnesses and health care for Persian Gulf veterans, as well as 
to evaluate the VA's sexual trauma counseling program. 
Testifying were officials from the VA, DOD, GAO, veterans 
service organizations, the Institute of Medicine (IOM) and the 
U.S. Navy's Infectious Diseases Department.
    These officials generally supported draft legislation 
(later introduced as H.R. 3980) to extend the special health 
care eligibility for Persian Gulf veterans, to provide those 
veterans a higher VA enrollment priority and to give VA the 
authority to provide priority care to veterans of future wars, 
among other initiatives (see Legislative Activities, Second 
Session, p. 45).
    With regards to the sexual trauma program, VHA Deputy Under 
Secretary Thomas Garthwaite testified that more veterans sought 
care at VA facilities for sexual trauma than had previously 
been identified. With that in mind, VA had submitted a 
legislative proposal to extend the VA's sexual trauma 
counseling program through December 31, 2003. Subcommittee 
Ranking Member, Luis Gutierrez, had also introduced legislation 
(H.R. 2253) to extend and enhance VA's sexual trauma program. 
GAO's Stephen Backhus testified to the effectiveness of the 
current program. He found that sexual trauma counseling is 
available in all VA medical centers and in four facilities as 
specialized programs. He found VA has also conducted extensive 
outreach to ensure that women veterans are aware of the 
program. Mr. Backhus testified to concerns on the part of VA 
health care professionals that the growing number of women 
veteran seeking care for sexual trauma will outgrow the number 
of staff to adequately treat them. The Committee heard 
testimony from DOD officials on their efforts to combat issues 
in the military that have given rise to sexual trauma in women 
veterans. H.R. 4110, as amended, contained a provision to 
extend sexual trauma counseling and treatment through December 
31, 2001, and was eventually enacted as part of Public Law 105-
368.
    On June 17, 1998, the subcommittee conducted a hearing to 
examine the future role of the VA health care system. Such 
factors as the changes in medical technology and practice 
patterns; the aging of VA's infrastructure; and the aging, 
migration patterns, and decline of the veteran population, 
necessitate serious examination of how best to meet veterans' 
future health care needs. In addition to VHA Under Secretary 
Kenneth Kizer, those testifying included officials from The 
American Legion, the Independent Budget, and the Vietnam 
Veterans of America testified, as well as representatives from 
GAO, the Association of American Medical Colleges (AAMC), and 
Marjorie Quandt, the former executive director of the 
Commission on Future Structure of Veterans Health Care.
    Testimony varied widely on how VA should best be positioned 
to provide health care in the future. Steve Robertson of The 
American Legion offered the organization's legislative 
recommendation, the ``GI Bill of Health,'' as the best vehicle 
for ensuring the VA health care system's continued viability. 
Marjorie Quandt testified that by the year 2015, 22 states plus 
the District of Columbia would not have sufficient veterans' 
population to maintain a VA hospital. She recommended that by 
closing unneeded facilities and instituting VA/DOD joint 
operations, the VA could maintain its current workload capacity 
while freeing up funds to care for its aging population base. 
Stephen Backhus of GAO testified that some VA inpatient 
capacity is no longer needed and that VA's success in the 
future will be based in part on how well it handles its 
unneeded infrastructure. Dr. Richard Krugman, representing 
AAMC, advised that the VA needs to continue to have a healthy 
working relationship with medical colleges, which in many 
instances provide an important employment base to VA medical 
centers.
    In all, the views offered during the hearing provided the 
subcommittee with a valuable perspective that will provide a 
framework for further review and oversight in the 106th 
Congress.
    On June 30, 1998, the subcommittee traveled to Boise, 
Idaho, for a hearing to review provision of health care to 
Idaho's veterans. The hearing reached beyond the scope of VA 
care to examine TriCare. For the first time, officials from the 
VA, DOD, and TriWest, a subsidiary of TriCare, were in the same 
forum to discuss many of the health care access problems 
experienced by veterans, military retirees and their families. 
The testimony indicated that these three entities had not 
communicated effectively with one another, resulting in poor 
coordination of the federal resources available to serve DoD 
and VA beneficiaries. Chairman Stearns obtained a commitment 
from each group to collaborate in serving VA and DoD 
beneficiaries.
    The subcommittee should continue to work with Rep. 
Chenoweth to ensure that care for Idaho's veterans improves and 
remains at a high level.
    On July 23, 1998, the subcommittee held its final oversight 
hearing of the year to review VA's provision of specialized 
services, and its compliance with the provision in law 
requiring that specialized service capacity be maintained. The 
subcommittee heard testimony from VA and GAO officials, as well 
as representatives of the major veterans' service organizations 
and Congressionally mandated committees dealing specifically 
with VA's provision of specialized services.
    One of the issues discussed was VA's annual report to 
Congress on maintenance of specialized program capacity. 
Witnesses called into question the integrity of the reported 
data. A PVA survey, for example, identified significantly fewer 
spinal cord injury beds at a number of VA facilities than VA 
reported.
    Both the Department's report and witnesses' testimony 
documented the variability in efforts to maintain program 
capacity from network to network. The subcommittee heard 
testimony that management priorities, rather than budget 
pressures alone, contributed significantly to the variability 
in network compliance with the requirement to maintain 
specialized programs. The Deputy Under Secretary for Health 
expressed a commitment to give greater priority to this 
statutory obligation, and conceded under questioning that 
establishment of pertinent performance measures for network 
directors could be a remedial measure. The Committee developed 
legislation in the form of an amendment to H.R. 3980 to require 
VA to establish such measures.
    The Committee should continue to closely monitor these 
programs with an eye to ensuring that VA adheres to the law. 
Further oversight is recommended on this matter during the 
106th Congress.

                        Subcommittee on Benefits

    The Subcommittee on Benefits has jurisdiction over 
veterans' matters affecting compensation, pension, insurance, 
memorial affairs, education, training, employment and housing. 
In addition to overseeing programs administered by the Veterans 
Benefits Administration and the National Cemetery System, the 
Subcommittee has oversight authority of overseas cemeteries 
under the jurisdiction of the American Battle Monuments 
Commission. The former Subcommittee on Compensation, Pension, 
Insurance and Memorial Affairs was merged with the former 
Subcommittee on Education, Training, Employment and Housing to 
form the current Subcommittee on Benefits.

                         LEGISLATIVE ACTIVITIES

First Session

    On July 9, 1997, the full committee held a hearing on H.R. 
2040 and S. 923, legislation restricting burial rights in 
national cemeteries and entitlement to other VA benefits when 
an honorably discharged veteran commits serious crimes. 
Witnesses included three members of Congress: Honorable Spencer 
Bachus, Honorable Ike Skelton, and the Honorable Joe 
Knollenberg. In addition, testimony was received from the 
Honorable Jerry Bowen, National Cemetery System; Mr. Johnny 
Killian, American Law Division, Congressional Research Service; 
and Mr. Rick Surratt, representing the views of the Disabled 
American Veterans, The American Legion, AMVETS, Blinded 
Veterans Association, Jewish War Veterans, Paralyzed Veterans 
of America, Veterans of Foreign Wars, and Vietnam Veterans of 
America.
    VA testified that while the legislation could present some 
implementation difficulties, H.R. 2040 would address concerns 
regarding the preservation of the sanctity of veterans' 
cemeteries. Mr. Killian testified that no constitutional 
objection would be warranted by either bill because veterans' 
benefits are gratuities that Congress confers and Congress had 
the power to curtail eligibility for the programs. The members 
of Congress felt very strongly that our tax dollars should not 
be used to honor a murderer, for example, who happens to be a 
veteran.
    On July 16, 1997, the subcommittee held a legislative 
hearing to receive testimony on pending education, training and 
employment legislative draft proposals and the following bills: 
H.R. 166, the Veterans' Job Protection Act; H.R. 167, the 
Veterans' Training and Employment Bill of Rights Act; H.R. 759, 
providing a 10 percent increase in Montgomery GI Bill benefits 
(active duty and dependents); and H.R. 1877, expanding the 
Work-Study program for veteran-students.
    Honorable G.V. (Sonny) Montgomery, former Chairman of the 
House Veterans' Affairs Committee, testified in support of H.R. 
759. Honorable Al Borrego, Acting Assistant Secretary of 
Veterans' Employment and Training Service, provided testimony 
on H.R. 166 and H.R. 167, along with draft legislation amending 
the Uniformed Service Employment and Reemployment Rights 
Improvement Act of 1997 (USERRA). While the Administration 
supported the legislative intentions of H.R. 166 and USERRA, 
they offered suggestions on clarifying certain provisions of 
each bill to ensure the effectiveness. The Administration 
supported H.R. 167. Celia Dollarhide represented the Department 
of Veterans Affairs and supported the concepts set forth in 
H.R. 759 and H.R. 1877. VA also commented on a draft bill, the 
Veterans Education Benefits Act of 1997, with opposition to one 
of the seven sections of the bill. The veterans service 
organization witnesses, representatives from Non Commissioned 
Officers Association, Veterans of Foreign Wars, Disabled 
American Veterans, AMVETS, and The American Legion supported 
the general intent of all the bills, but offered suggestions 
for strengthening the language of the draft proposals on the 
basis that they did not offer enough protection to veterans.
    On September 4, 1997, the subcommittee marked up H.R. 2367, 
the Veterans' Compensation Cost-of-Living Adjustment Act of 
1997. H.R. 2367 proposed to provide a cost-of-living 
adjustment, effective December 1, 1997, to the rates of 
disability compensation and dependency and indemnity 
compensation for the survivors of certain disabled veterans. 
The bill was reported to the full committee by unanimous voice 
vote. On September 11, the bill was favorably reported to the 
House by the full committee (see House Report 105-320). The 
bill, which became Public Law 105-98, was signed into law on 
November 19, 1997.
    On September 11, 1997, the full committee marked up S. 923 
and ordered it favorably reported to the House with an 
amendment in the nature of a substitute (see House Report 105-
319). S. 923, as amended, which became Public Law 105-116, was 
signed into law on November 21, 1997.
    On December 18, 1997, the subcommittee held a legislative 
hearing on H.R. 3039, the Veterans Transitional Housing 
Opportunities Act of 1997, in Buffalo, New York. VA Committee 
members in attendance were Subcommittee Chairman Jack Quinn and 
full committee Ranking Member Lane Evans. Representative John 
LaFalce (NY) also attended the hearing.
    The witnesses testifying were Paul Angrisano, Vietnam 
Veterans of America; Linda Boone, National Coalition for 
Homeless Veterans; Martin Bugaj, Department of New York; David 
Dollner, New York State Department of Labor; Frank Falkowski, 
Western New York Veterans Housing Coalition; Dennis Fink, 
Friends of Cazenovia Manor, Inc.; Command Sgt. Maj. Gary 
Flaherty, Non Commissioned Officers Association, Richard 
Gallagher, Western New York Alcohol and Drug Dependency 
Services; James Hartman, New York Veterans Employment and 
Training; William Lyons, First National Bank; Peter Mazzerella, 
VFW, Department of New York; John Sampson, The American Legion; 
Dr. Joan Sulewski, Chairman Jack Quinn's Veterans Advisory 
Committee; Mary Lee Sulkowski, Buffalo VA Vets Center. Mr. 
Peter Dougherty, Homeless Veterans Programs, represented the 
Department of Veterans Affairs.
    Most of the witnesses supported the bill and how it would 
help increase services to homeless veterans across the nation, 
albeit with some questions about the proposed funding 
mechanisms. The Administration, however, was not in a position 
to give formal views on H.R. 3039 and was in the process of 
making a thorough review of the bill.

Second Session

    On February 24, 1998, the subcommittee conducted another 
legislative hearing on H.R. 3039, the Veterans' Transitional 
Housing Assistance Act of 1997, and H.R. 3211, codifying 
eligibility requirements for burial at Arlington National 
Cemetery. Deputy Assistant Secretary of the Army (Military 
Personnel Management and Equal Opportunity Policy) John 
McLaurin, accompanied by Mr. Jack Metzler, Superintendent of 
Arlington National Cemetery, testified on behalf of the 
Secretary of the Army. Mr. Keith Pedigo, Director, Loan 
Guaranty Service at the Veterans Benefits Administration, 
testified on behalf of the VA. Mr. Raymond Boland, Secretary of 
the Wisconsin Department of Veterans Affairs, and Mr. Tom 
Cantwell of the Westside Residence Hall, Inc., testified in 
support of H.R. 3039. Representatives from various veterans 
service organizations shared their views on both bills. 
Congressman Jerry Kleczka submitted a statement for the record 
praising the subcommittee for addressing the problems at 
Arlington, and discussed his bill, H.R. 3145, which, like H.R. 
3211, would have ended the waiver process for burials. The 
veterans service organizations supported codifying the 
eligibility requirements for burial at Arlington and 
eliminating waivers for burial. The Army supported setting 
forth in law the eligibility criteria for burial. However, they 
opposed eliminating eligibility for high ranking government 
officials, those with some military experience, who distinguish 
themselves in the legislative, judicial or executive offices 
they held. Additionally, they did not support limiting the 
discretion to grant exceptions in those circumstances that have 
historically warranted burial at Arlington.
    On March 5, 1998, the subcommittee marked up three bills: 
H.R. 3039, the Veterans' Transitional Housing Assistance Act of 
1997; H.R. 3211, codifying eligibility requirements for burial 
at Arlington National Cemetery; and H.R. 3213, clarifying 
enforcement of veterans' employment and reemployment rights. On 
February 24, 1998, the subcommittee conducted a legislative 
hearing on H.R. 3039 and H.R. 3211. H.R. 3039 and H.R. 3213 
were ordered reported favorably to the full committee by 
unanimous voice vote. H.R. 3211 was reported favorably to the 
full committee with an amendment in the nature of a substitute 
by unanimous voice vote.
    On March 11, 1998, the full committee met to markup H.R. 
3039, H.R. 3211, and H.R. 3213. All three bills were ordered 
reported favorably to the House by unanimous voice vote.
    On June 18, 1998, the subcommittee conducted a legislative 
hearing on an omnibus draft bill providing a cost-of-living 
adjustment for service connected disabled veterans and certain 
survivors, and making various improvements in education, 
housing, and cemetery programs. The bill also included 
administrative provisions relating to the Board of Veterans' 
Appeals and the Court of Veterans Appeals. For the most part, 
representatives from the veterans service organizations--The 
American Legion, Veterans of Foreign Wars, Paralyzed Veterans 
of American, and Non Commissioned Officers Association--
supported the provisions of the bill. NCOA opposed expanding 
the State Cemetery Grants Program and PVA opposed giving 
members of the Board the title ``administrative law judge.'' 
The Department of Veterans Affairs supported many of the 
provisions in the bill and chose to defer comment on two other 
provisions.
    On June 18, 1998, following the legislative hearing, the 
subcommittee marked up the draft bill. The bill was ordered 
reported favorably by unanimous voice vote to the full 
committee.

                           OVERSIGHT HEARINGS

First Session

    On May 7, 1997, the subcommittee held an oversight hearing 
on Government Performance and Results Act (GPRA) strategies for 
the Veterans' Employment and Training Service (VETS) to help 
determine whether VETS was accomplishing what it was designed 
to do. Witnesses included Honorable Preston Taylor, Assistant 
Secretary of VETS; Carlotta Joyner of the General Accounting 
Office; and representatives from the Non Commissioned Officers 
Association, the Disabled American Veterans, Veterans of 
Foreign Wars, and The American Legion.
    The Department of Labor's VETS provided its framework for 
complying with the Results Act, which relied heavily on 
customer service surveys and vigorous consulting with 
stakeholders and service provider partners. The veterans 
service organization representatives supported the overall 
operations of VETS and their achievements. However, they urged 
the Committee to ensure veterans will continue to receive 
priority assistance.
    On May 14, 1997, the subcommittee conducted an oversight 
hearing on operations within the Compensation and Pension 
Service using Government Performance and Results Act 
principles; the Department's handling of Persian Gulf War 
veterans' claims; and VA's draft legislation to limit liability 
for compensating and treating veterans with smoking-related 
illnesses. Witnesses included Ms. Kristine Moffitt, Director of 
VA's Compensation and Pension Service; Mr. Stephen Backhus, 
General Accounting Office; and representatives of veterans 
service organizations (VSOs).
    Ms. Moffitt provided details of VA's plan for implementing 
requirements of the Results Act, a business plan that was 
integrated and combined with Business Plans from four other 
Services into one comprehensive Veterans Benefits 
Administration Business Plan. This Business Plan was used as 
VA's FY 98 budget request. GAO testified that VBA needed to 
identify specific measures that are results-oriented rather 
than process-oriented, and suggested that VBA will be 
challenged in implementing the Results Act because it has had 
difficulties in the past in bringing about program 
improvements.
    Through hearings, briefings, and discussions, the 
Subcommittee continued its oversight of the Department's 
implementation of Results Act performance measures.
    During the hearing, each of the veterans service 
representatives testified that they strongly supported the 
expansion of the presumptive period for Persian Gulf War 
veterans with undiagnosed illnesses from two to ten years and 
many cited improper claim development and inadequate staff to 
develop, rate, and adjudicate Persian Gulf War claims. VA 
explained it was currently readjudicating 10,736 cases to 
ensure that proper weight was being accorded to less 
traditional types of evidence and to ensure that information 
about the claims was properly entered into the tracking system.
    Without having reviewed the VA's proposed legislation to 
limit liability for smoking-related illnesses, most of the VSOs 
were not in support of the concept.
    On May 21, 1997, the full committee conducted a hearing to 
receive testimony on the findings and recommendations of the 
Veterans' Claims Adjudication Commission. Witnesses included 
Mr. William LaVere, a member of the Commission; Dr. Stephen 
Lemons, Acting Under Secretary for Benefits; Mr. Milton 
Socolar, chairman of National Academy of Public Administration, 
a panel reviewing compensation and pension matters; and 
representatives from AMVETS, The American Legion, Veterans of 
Foreign Wars, Vietnam Veterans of America, and Disabled 
American Veterans.
    There was substantial agreement with the majority of the 
Commission's recommendations by the VA's Strategic Management 
Group, however, then-Secretary Jesse Brown noted that 
``benefits earned are different from benefits bestowed.'' By 
and large, the veterans' service organizations felt the 
Commission failed to address the adjudication system as it 
currently exists and blamed the veteran for adjudication 
problems rather than the system. The Veterans of Foreign Wars 
testified that the ``. . . good parts of the report are 
overwhelmed by the negative aspects.'' Conversely, the 
Commission observed that the current system represents a life-
time driven system of perpetual claims for which there is no 
closure. The VA Committee agreed with many of the Commission's 
recommendations, and is exploring introducing some legislation 
based on the report.
    On June 5, 1997, the subcommittee conducted a hearing of 
Government Performance Results Act (GPRA) strategies for both 
the VA's Education Service and the Vocational Rehabilitation 
and Counseling (VR&C) Service. Ms. Celia Dollarhide, VA 
Education Service Director, represented the VA. Ms. Cynthia 
Fagnoni testified for the General Accounting Office. According 
to Ms. Fagnoni, while the Veterans Benefits Administration 
(VBA) had established four goals each for the VR&C program and 
the Education Service, they were not yet in a position to fully 
measure and assess program performance and results. GAO's view 
was that VBA needs to develop appropriate measures and cost 
data to monitor performance, and integrate its plan with 
Federal agencies and other State agencies. Ms. Dollarhide 
detailed the Department's goals for improving education and 
vocational rehabilitation services, acknowledging that the VA 
would continue to work with their stakeholders and this 
Committee in developing meaningful outcome measures.

Second Session

    On February 4, 1998, the subcommittee held an oversight 
hearing on the Department of Veterans Affairs' Vocational 
Rehabilitation programs. Witnesses included representatives 
from the administration, the veterans' service organizations, 
and the vocational rehabilitation community. Ms. Cynthia 
Fagnoni of the General Accounting Office testified that with 
regard to vocational rehabilitation, VBA focused too much on 
sending veterans to training rather than helping them get jobs. 
She also referred to GAO's 1996 report on the program. The 
veterans' service organizations and the Veterans Advisory 
Committee on Rehabilitation testified to their support of the 
vocational rehabilitation program, but felt that VA needs to 
assure employment outcomes, strengthen employment opportunities 
in placement, maintain a strong employment network, and move 
away from a training emphasis and toward a job placement 
emphasis. Honorable Al Borrego, Assistant Secretary, Veterans' 
Employment and Training Service spoke to the joint efforts of 
VA and VETS to ensure the further effectiveness of the 
vocational rehabilitation program. VA's Under Secretary for 
Benefits, Joseph Thompson, acknowledged the concerns expressed 
by the witnesses and the need to shift the focus from training 
to jobs.
    On March 26, 1998, the subcommittee conducted an oversight 
hearing on the Government Performance and Results Act (GPRA) 
principles for the five business lines at the Veterans Benefits 
Administration: compensation and pension, education, vocational 
rehabilitation, insurance and loan guaranty. Witnesses included 
Mr. Joseph Thompson, Under Secretary for Benefits at VBA, and 
Ms. Cynthia Fagnoni of the General Accounting Office. Mr. 
Thompson testified to VBA's commitment to implementing GPRA 
principles and explained their plan, which is based on 
establishing goals and objectives within a corresponding 
framework to track progress achieved and to establish clear 
accountability. VBA recognized it needed to do much more 
strategic planning to form the foundation for all its 
operations. GAO testified that while VBA continues to make 
progress in setting goals and measuring its programs' 
performance, it still had significant challenges in its efforts 
to implement GPRA. According to GAO, major deficiency was VBA's 
lack of data needed to effectively measure its performance in 
several key areas.
    On April 29, 1998, the subcommittee held a hearing on 
operations within the National Cemetery System and the American 
Battle Monuments Commission. In addition, Ms. Carolyn Becraft, 
representing the Department of Defense, presented the DoD's 
views on military burial honors, including current and future 
availability of surplus military weapons and ammunition to 
approved organizations for ceremonial purposes. Mr. Stephen 
Backhus of the General Accounting Office presented the GAO's 
findings (September 1997 report) concerning the National 
Cemetery System's ability to accommodate the increasing demand 
for burials, and what VA can do to extend the service period of 
existing national cemeteries. GAO believed that NCS should 
articulate to the Congress and other stakeholders how it planed 
to address the estimated workload through 2010, and suggested 
NCS identify opportunities to construct columbaria in existing 
cemeteries as a means of extending cemetery service periods. 
Mr. Roger Rapp, representing VA, discussed the Cemetery 
System's strategic plan. Members of the subcommittee and GAO 
stated some concerns, because veterans' deaths will peak in the 
years 2005 to 2010 while the strategic plan outlines activities 
only through 2003. Mr. Rapp also explained the status of four 
new cemeteries set to open by the year 2000 and plans for 
expanding existing cemeteries. Rep. Filner asked VA to provide 
a 10-year ``roadmap'' for the National Cemetery System to be 
delivered to the subcommittee by August, 1998. Mr. John 
Vitikacs, of The American Legion, testified that in the 
Legion's opinion, NCS had not completed the strategic planning 
process for future burial options because the current strategy 
does not extend practicable burial options to millions of 
veterans. General Fred Woerner provided an overview of the 
American Battle Monuments Commission's operations, and the 
results of the first agency-wide audit of their financial 
statements as required by Public Law 104-275. Mr. David Clark, 
of the General Accounting Office, shared the results of the 
joint GAO/Peat Marwick audit of ABMC, identifying only minor 
weaknesses, which were primarily systems-related. The ABMC 
received an unqualified opinion on their balance sheet.
    On May 20, 1998, the Subcommittee on Benefits conducted a 
joint hearing with the Subcommittee on Government Programs and 
Oversight of the Committee on Small Business to examine the 
performance of the Small Business Administration in providing 
financial and entrepreneurial assistance to veterans. Five 
witnesses, Dr. Paul Camacho, Mr. Paul Hanley, Mr. Bill Elmore, 
Mr. Emil Naschinski, Mr. William Crandell, and Mr. Kenneth 
Yancey, Jr., testified to their disappointment with the Office 
of Veterans Affairs (OVA) in the Small Business Administration 
(SBA). They believed OVA needed increased funding, a direct 
line of authority to the administrator, and an accessible 
network of current and prospective veteran business owners. Mr. 
Clifton Toulson, Jr., testifying on behalf of the SBA, 
expressed the department's commitment to the formation and 
growth of veteran-owned small businesses and improving its 
performance in assisting veterans.
    On June 10, 1998, the subcommittee held an oversight 
hearing on operations at the Board of Veterans' Appeals and the 
Court of Veterans Appeals, and received testimony on H.R. 3212, 
a bill to revise the provisions of law relating to the 
retirement of judges on the Court, and for other purposes. The 
Honorable Frank Nebeker, Chief Judge, testified on behalf of 
the Court, the Honorable Richard Standefer testified on behalf 
of the Board of Veterans' Appeals, and representatives from the 
Disabled American Veterans, Vietnam Veterans of America, 
AMVETS, Veterans of Foreign Wars, and the Paralyzed Veterans of 
America represented the veterans service organizations. All 
witnesses supported the provisions in H.R. 3212. The VSO 
representatives' chief complaint about the Board and the Court 
was the sharing of information following an appeal of the 
Board's decision. Chief Judge Nebeker clarified the process 
following an appeal to the Court and said there was no usual 
relationship between the government and the Court.
    On July 16, 1998, the subcommittee held an oversight 
hearing on VA's standards for adjudicating claims presented by 
veterans suffering from hepatitis C and cerebral malaria, along 
with an update on Persian Gulf War claims adjudication. 
Witnesses included representatives from veterans' service 
organizations and Mr. Paul Sullivan of the National Gulf War 
Resource Center. Dr. Teresa Wright, San Francisco VAMC; Dr. 
John Booss, VA Director of Neurology; and Dr. Nils Robert 
Varney, Iowa City VAMC, testified on behalf of the VA on 
hepatitis C and cerebral malaria. Mr. Robert Epley, 
representing the Compensation and Pension Service, discussed 
claims processing for these illnesses. The veterans service 
organizations all testified that as a result of VA's overly 
strict interpretation of Public Law 103-446, many Persian Gulf 
veterans were being denied service connection, and that the 
regulations need to be rewritten. The VA testified to current 
Gulf War statistics, but made little mention on claims 
processing, beyond stating a 78 percent denial rate for 
undiagnosed illness. Dr. Varney testified about his research on 
cerebral malaria in Vietnam veterans, and Dr. Booss disputed 
the findings. The VA maintains that the rules and procedures 
they currently apply to any claim for service connected are 
adequate to determine whether hepatitis C and cerebral malaria 
are service connected. VA is, however, working with VHA to 
determine whether some changes in law or regulation would be 
appropriate in light of the new scientific evidence regarding 
hepatitis C, such as the 10 to 30-year latency period.
    On July 22, 1998, the full committee held an oversight 
hearing on benefits for Filipino veterans. Witnesses included 
members of Congress, representatives from the Department of the 
Army and the Library of Congress' Congressional Research 
Service, and various members of the Filipino veteran community. 
Representatives Benjamin Gilman (NY), Randy ``Duke'' Cunningham 
(CA), Neil Abercrombie (HI), Patsy Mink (HI), and Nancy Pelosi 
(CA) all testified in support of expanding benefits to World 
War II Filipino veterans, as did Filipino veteran community 
representatives. The veterans' service organization witnesses, 
representatives from the Veterans of Foreign Wars, The American 
Legion, and Jewish War Veterans of the U.S.A. supported 
benefits expansion, though they acknowledged the cost of such a 
proposal as significant. Dr. Clayton Laurie, Historian, U.S. 
Army Center of Military History reported that his department 
had been unable to locate any documents asserting a prior 
Congressional promise to provide Filipino veterans VA benefits 
equal to U.S. servicemembers. Dr. Dennis Snook, Specialist on 
Social Legislation at the Library of Congress provided a 
history of veterans benefits for Filipinos, and concluded that 
Filipinos were currently receiving what they were intended to 
receive under U.S. law.
    On August 5, 1998, the full committee conducted an 
oversight hearing on the garnishment of benefits paid to 
veterans for child support and other court-ordered family 
obligations. Witnesses included representatives from the 
following organizations: U.S. Marine Corps, American Retirees 
Association, Women in Search of Equity for Military and 
Divorce, Air Force Sergeants Association, The Retired Officers 
Association, Department of Defense, Fleet Reserve Association, 
Justice and Equality for the Military Wife, The Retired 
Enlisted Association, Non Commissioned Officers Association, 
National Military Family Association, Disabled American 
Veterans, Department of Veterans Affairs, U.S. Navy, Ex-
Partners of Servicemen/women for Equality, and the American Bar 
Association.
    Most of the witnesses stated a legal and moral obligation 
for every parent to support his or her children and endorsed 
efforts to ensure that support is provided. The witnesses' 
testimony focused on H.R. 2537, the Former Spouses Protection 
Act of 1997. In addition to the veterans service organizations 
participating in the hearing, the Women In Search of Equity 
organization supported changes to the Uniformed Services Former 
Spouses Protection Act. The witnesses that supported military 
retirement pay continuing to be treated as property in divorce 
proceedings include the American Bar Association, National 
Military Family Association, Justice and Equality for the 
Military Wife, and Ex-Partners of Servicemen and Women for 
Equality. The VA witness stated that there are VA regulations 
designed to ensure that there is an equitable division of 
veterans' benefits where VA beneficiaries are failing to meet 
their parental/marital obligations. The Department of Defense 
representative testified to the Department's strong advocacy of 
parental child support. DoD could offer no position on H.R. 
2537; they testified that they had just begun a comprehensive 
review of the Uniformed Services Former Spouses Protection Act 
and were required to report their findings and recommendations 
to Congress not later than September 30, 1999.

                          Oversight Activities

Recommendations of Commission on Servicemembers and Veterans Transition 
                               Assistance

    Public Law 104-275 established the Commission on 
Servicemembers and Veterans Transition Assistance to assess the 
adequacy and effectiveness of Federal transition assistance 
programs and benefits for servicemembers and veterans.
    The Commission was comprised of 12 members who were 
appointed by the Committees on Veterans' Affairs of the House 
of Representatives and the Senate and by the House National 
Security Committee and the Senate Armed Services Committee.
    The Commission was chaired by the Honorable Anthony J. 
Principi. Its Vice Chairman was the Honorable G. Kim Wincup. 
The Commission's panel on veterans' benefits was chaired by 
General J. B. Davis (USAF, Ret.); its panel on servicemembers 
was chaired by Ronald W. Drach; and its panel on transition 
health care issues was chaired by Lieutenant Colonel Renee 
Priore (USA, Ret.).
    The Committee staff received a preliminary briefing on the 
Commission's findings and recommendations on December 1, 1998. 
The Commission is expected to transmit its report formally to 
the Committee in January 1999. The Commission's report will 
contain recommendations on some 31 transition issues in 
thematic areas such as education, employment and training 
(including servicemember transition assistance programs), 
transition health care, economic equity (housing, small 
business and other areas), and organizational structure 
(primarily involving the Departments of Veterans Affairs and 
Defense).
    The Committee recommends a full committee hearing in the 
106th Congress to receive the Commission's recommendations in 
late January, 1999.

              Subcommittee on Oversight and Investigations

    The Subcommittee on Oversight and Investigations reviews 
the benefits and the health care services that the federal 
government provides to eligible veterans and family members. It 
also oversees the programs and operations of the Department of 
Veterans Affairs, as well as those of other federal agencies 
that pertain to veterans. In carrying out its responsibilities, 
the subcommittee conducts hearings, site visits and 
investigations nationwide. It also requests reports from the 
General Accounting Office, the Congressional Research Service 
and the VA's Office of the Inspector General. The subcommittee 
does not have legislative jurisdiction so that its resources 
can be solely dedicated to oversight authorized by the full 
Committee.

                          Oversight Activities

First Session

    On April 17, 1997, the subcommittee heard testimony on 
sexual harassment issues in the VA, particularly at the VA 
Medical Center in Fayetteville, NC. Five women who were 
employees of that medical center gave sworn testimony about 
sexual harassment and personal abuse they had experienced from 
the medical center's former director. Representatives of the VA 
and the VA's Office of Inspector General testified regarding 
the VA's Equal Employment Opportunity program and the 
investigation of complaints at Fayetteville. A representative 
of the Equal Employment Opportunity Commission testified 
regarding government-wide EEO policies and programs and sexual 
harassment law. Representatives of the National Managers 
Association, the Nurses Organization of Veterans Affairs, 
Federally Employed Women, and the American Federation of 
Government Employees also presented their views on sexual 
harassment issues in the VA and the federal government.
    The testimony showed that Directors at field facilities 
were the EEO officers for their facilities, even though they 
and other senior facility managers could be the subject of 
complaints about sexual harassment or other discrimination, or 
could effectively condone such unlawful behavior by blocking 
action on complaints. The subcommittee concluded that sexual 
harassment problems in the VA that had been of concern to the 
Committee four years earlier at the Atlanta VA Medical Center 
had not been effectively addressed. Subsequent to the hearing, 
Chairman Everett and the full Committee Ranking Democratic 
Member, Honorable Lane Evans, introduced H.R. 1703, the 
Department of Veterans Affairs Employment Discrimination 
Prevention Act, to reform the VA's EEO system by making it 
independent of local facility management and by establishing an 
independent appeals process within the department for decisions 
on complaints.
    On May 22, 1997, the subcommittee heard testimony on VA 
safety and security issues concerning veterans and over 240,000 
VA employees. The hearing was prompted by the tragic murder in 
February 1996 of a VA physician at the VA Medical Center in 
Jackson, MS. This was the second violent assault at the 
facility in less than two years. The subcommittee examined VA's 
pilot demonstration program to arm its hospital law-enforcement 
officers. The physical safety of veterans and VA employees is 
paramount, and the subcommittee sought and received assurances 
from the VA that the arming of these officers would be 
accomplished at a deliberate pace with stringent safeguards. 
The subcommittee required the VA to notify the Congress of any 
expansion of demonstration sites and of any weapons incidents.
    The subcommittee also examined the security of controlled 
drugs in VA hospitals. VA pharmacy operations cost more than $1 
billion annually. Due to the high value of VA drug inventories 
and their theft potential, the subcommittee was concerned about 
how the VA has addressed accountability and security problems 
that had been previously identified by the VA's IG. The VA 
testified that some of the issues had not been totally resolved 
because they were software driven, but that current procedures 
and policies concerning controlled substances are stringent, 
and some are onerous to employees. The VA further stated that 
no significant volumes of controlled substances had been 
diverted in the last few years, and as the VA changes from 
hospital based care to community based clinics, it will 
reassess the system and continue to address these issues.
    The subcommittee also heard testimony from Mr. John Baffa, 
Deputy Assistant Secretary for Security and Law Enforcement, 
Veterans Health Administration; Mr. Charles Rinkevich, 
Director, Federal Law Enforcement Center (FLETC), Department of 
Treasury; Mr. Joseph Wolfinger, Director of Training, Federal 
Bureau of Investigation; The American Legion; American 
Federation of Government Employees, AFL-CIO; and the Nurses 
Organization of Veterans Affairs (NOVA).
    Mr. Baffa testified that it was not the VA's intent to arm 
VA police nationwide; that the intent was to develop a pilot 
program involving five hospitals in five geographical locations 
with high crime rates. Mr. Renkevich and Mr. Wolfinger's 
testimony highlighted the background and training capabilities 
of FLETC: that its mission was conducting basic and advanced 
training for the majority of federal government's law 
enforcement personnel, and that it had 70 federal agencies 
participating in more than 200 different programs. Mr. 
Rinkevich further testified, when questioned, that FLETC could 
have offered the agency specific training that the VA had 
previously testified they needed.
    The American Legion testimony supported the VA's pilot 
arming program and a full evaluation of the program prior to 
any expansion. NOVA's testimony did not support VA's arming of 
the VA police. They supported an alternative strategy of staff 
education and training along with knowledge of evaluation and 
intervention techniques to reduce workplace violence. The 
subcommittee had additional concerns about fire safety issues 
critical to VA patients and employees. The VA testified that it 
still maintains 30 hospital fire stations with an annual 
operating budget of over $16.3 million and staffed with 357 
firefighters.
    The subcommittee should continue to monitor the VA's arming 
demonstration. The subcommittee should continue to monitor VA's 
continuing efforts to decrease the vulnerability and increase 
the security of VA's vast drug inventory. The subcommittee 
should also continue to scrutinize the efficiencies of the VA's 
fire fighting force and the cost effectiveness of alternatives.
    On June 26, 1997, the subcommittee heard testimony on the 
VA's efforts to ensure their computer systems would not fail 
after 12:00 a.m. on the morning of the year 2000 (Y2K). The 
subcommittee received the testimony of Honorable Steve Horn, 
Chairman of the Government Reform and Oversight, Subcommittee 
on Government Management, Information, and Technology. Chairman 
Horn's subcommittee has reviewed the entire federal 
government's efforts to insure Y2K compliance and has issued 
reports and grades for the efforts of federal agencies. 
Chairman Horn gave the VA a ``D'' because the agency did not 
have a Y2K plan, did not have Y2K cost estimates, and had only 
recently appointed a program manager. Mr. Horn also expressed 
concern that the VA had not completed their inventory of local 
computer applications, did not have an adequate system for 
prioritizing mission critical applications, and did not have 
contingency plans for systems failing.
    The subcommittee heard testimony from GAO warning that the 
3.7 million checks to veterans with service-connected 
disabilities could be severely delayed because VA's non-
compliant computer systems could fail. GAO expressed concern 
that the VBA's Y2K program management needed to be strengthened 
and that an agency level program office needed to be 
established to coordinate and manage the agency's full range of 
interdependent information system activities. GAO found that VA 
had not determined VBA's information system components were Y2K 
compliant; that VBA had not developed contingency plans for its 
three major business areas to ensure continued operations in 
the event of Y2K failures; and that VBA did not have sufficient 
information about costs and risks associated with Y2K 
compliance activities.
    The subcommittee also heard testimony from the Food and 
Drug Administration on their efforts to assess the dangers of 
Y2K failures for medical devices utilizing embedded chip 
technology. The subcommittee was critical of the FDA's lack of 
initiative on patient safety issues related to medical devices 
that might experience Y2K failures.
    The subcommittee also requested that the GAO assess Y2K 
vulnerabilities in the Veterans Health Administration. The 
subcommittee required the VA to immediately inform the 
subcommittee of any missed milestones in their compliance 
program.
    On July 17, 1997, the subcommittee followed up its hearing 
on April 17, 1998 with more general testimony on sexual 
harassment issues in the VA and on H.R. 1703. The VA in its 
testimony opposed the bill and defended the efficacy of its 
``Zero Tolerance'' policy and employee training on sexual 
harassment. The VA had opposed almost identical legislation in 
1993. However, the bill received expressions of strong 
bipartisan support from members of the subcommittee and North 
Carolina Senator Lauch Faircloth, who testified that he had 
introduced S. 801, a Senate companion bill to H.R. 1703. The VA 
Office of the Inspector General's testimony provided an update 
of its follow-up on allegations of impropriety by the former 
director of Fayetteville. H.R. 1703, as amended, became Public 
Law 105-114 on November 21, 1997. (See p. 32.)
    The subcommittee recommends that oversight of the VA's new 
EEO system continue during the 106th Congress to ensure that 
the department's implementation of Public Law 105-114 is 
consistent with congressional intent and is effectively 
administered.
    On July 24, 1997, the subcommittee held a joint hearing 
with the Subcommittee on Health on VA's consolidation of 
medical facilities, management, and services. Facility 
integrations are part of VA's nationwide strategy to 
restructure its health care delivery systems in a way similar 
to the private sector. The objectives are to improve access, 
quality, and particularly the efficiency of care provided to 
veterans. In the private sector, the dynamic health care 
marketplace has reacted to market challenges and has 
increasingly turned to mergers and alliances. The VA has been 
slow to transform itself.
    Until 1995, VA had not consolidated a facility in some 15 
years. Since then, VA has initiated some 19 consolidations 
involving 40 VA medical facilities. The joint hearing reviewed 
the record of the VA's past efforts on facility integrations 
and consolidations, and heard private sector testimony on the 
complexity and difficulty of integrating two or more hospitals. 
The joint subcommittee also heard testimony on the process by 
which VA facility integration was initiated, analyzed, planned, 
and carried out. Witness testimony was provided by the GAO; the 
Association of American Medical Schools; Dr. Kenneth Kizer, 
Under Secretary for Health, Veterans Health Administration 
(VHA), Department of Veterans Affairs and other VHA officials; 
The American Legion; Adventist HealthCare; and McManis 
Associates, Inc.
    GAO's testimony focused on the role of facility 
integrations in reshaping VA's health care delivery system and 
lessons learned that would help enhance VA's process for 
planning and implementing ongoing and future facility 
integrations. Their testimony included information on VA's 18 
integrations at that time. With one exception, they shared some 
common characteristics. Most of VA's integration involved 
facilities that had complementary missions, such as acute and 
mental health care. GAO stated that VA's facility integrations 
were critical to VA's overall strategy to enhance the 
efficiency and effectiveness of health service delivery to 
veterans. According to GAO, VA faced inherent difficulties in 
planning and implementing integrations primarily stemming from 
the potential adverse impacts on stakeholders such as veterans, 
facility and medical school personnel, and members of Congress 
who represent these groups. The subcommittee believes it is 
imperative for VA to plan and implement integrations to 
maximize their benefits and minimize the adverse impacts.
    GAO recommended that the VA could achieve better results by 
adopting a more comprehensive planning approach, completing 
planning before implementing changes, improving the timeliness 
and effectiveness of communications with stakeholders, and 
using a more independent planning approach.
    GAO observed that objective facility integration planning 
should be based on independent judgment to be successful, that 
many competing interests were at stake in VA's integrations, 
that all viable options were not aggressively considered, and 
that difficult choices were avoided by focusing only on 
marginal changes to the status quo. The subcommittee is 
concerned that some integrations may have yielded less than 
their full potential benefits to veterans and needlessly 
limited savings available for reinvestment.
    On July 28, 1997, the subcommittee held a field hearing in 
Montgomery, AL, on the planning and formation of the Central 
Alabama Veterans Health Care System (CAVHCS). The subcommittee 
heard testimony from Mr. Larry Deal, Director, Veterans 
Integrated Service Network 7. Mr. Deal's testimony centered on 
three points: that the integration would improve quality, 
access and cost effectiveness for veteran health care; that it 
would improve the long term viability of both Montgomery and 
Tuskegee medical centers; and that the integration efforts were 
in keeping with Dr. Kizer's strategic ``Vision for Change'' and 
``Prescription for Change''.
    The GAO in its testimony raised concerns about the 
Montgomery and Tuskegee VA medical center integration. 
According to GAO, integration decisions were being made 
incrementally, service-by-service at varying times throughout 
the process; planning and implementation activities frequently 
occurred simultaneously without a detailed comprehensive plan; 
decisions to centralize administrative services did not 
adequately explore options or take into account how future 
changes in workload might affect the facilities; VA had not 
made decisions on how to integrate a number of other services; 
and key questions about the availability of space in Montgomery 
remained unanswered. GAO also observed that several service 
chief positions were vacant, and GAO's analysis of other 
integrations indicated that these positions were key to 
comprehensive planning and should have been filled early in the 
planning process.
    Nationally, GAO's concerns involved stakeholder 
participation and buy-in. GAO believed both could be enhanced 
if VA provided stakeholders detailed information on all aspects 
of the integration before beginning implementation. VA's 
differing and conflicting responses to questions about 
potential construction and renovation costs needed for the two 
facilities caused considerable doubt among stakeholders and GAO 
about the sufficiency of planning.
    The subcommittee heard testimony from The American Legion, 
Vietnam Veterans of America and the Disabled American Veterans. 
The veterans' service organizations all concurred that 
reorganization was essential, but that the rapidity of the 
implementation and lack of stakeholder participation had 
resulted in confusion and misunderstanding among the VHA 
workforce, veterans and the families affected by the 
integration. The veterans service organizations recommended 
that the process be slowed down to better understand the long-
term impacts.
    The subcommittee requested that VA establish consolidation/
integration guidelines that would include a business plan to 
address comprehensive planning, stakeholder participation, 
communications, and cost benefits analysis. The subcommittee 
concluded that a great deal of revision and communication 
needed to occur before the VA moved forward with the 
integration of the Montgomery and Tuskegee VA Medical Centers.
    A GAO review of VA's integration plan revisions when 
completed for Tuskegee and Montgomery was directed on July 28, 
1997, by Honorable Jerry Lewis, Chairman, Appropriations 
Subcommittee on VA, HUD, and Independent Agencies. The GAO 
provided its review to Chairman Lewis in September 1998 and 
found that the revised plan conformed to the planning criteria 
that such a plan should be able to meet.
    The subcommittee recommends additional oversight of this 
integration and VA facility integrations generally in the 106th 
Congress.
    On September 18, 1997, the subcommittee held a hearing on 
the VA's implementation of the Government Performance and 
Results Act of 1993 (Results Act). Federal departments and 
agencies under the Results Act are required to develop and 
implement real strategic business plans that resemble those 
used in the private sector. These plans should define and 
achieve measurable outcomes linked to the specific business 
lines of veterans programs and their annual operating budgets.
    Ms. Cynthia M. Fagnoni, Associate Director, Health, 
Education and Human Services Division, General Accounting 
Office, testified that the VA had made significant progress in 
its strategic planning, based in part on consultations with 
Congress. At the time of the hearing, the VA's plan was not yet 
due. Ms. Fagnoni testified that based on the draft reviewed by 
GAO, the plan when submitted in final form at the end of 
September 1997 would be more complete and better organized to 
focus less on process and more on results. She noted, however, 
that the VA needed to continue improving its strategic plan to 
overcome a lack of results-oriented goals for major programs, 
particularly for benefit programs. Dr. Dennis W. Snook of the 
Congressional Research Service in his testimony provided the 
subcommittee with an expert analysis of the history and intent 
of the Results Act.
    The VA's representative emphasized the VA's commitment to 
strategic planning under the Results Act and acknowledged the 
department's lack of formal program evaluations on which to 
base true outcome-related performance measures. The department 
also outlined the approach they intended to use for program 
evaluations while using interim results-oriented goals to the 
extent possible. Representatives of the Departments of Defense 
and Labor testified on interdepartmental planning and 
cooperation in veterans' matters. Representatives from AMVETS, 
The American Legion, Veterans of Foreign Wars, and Disabled 
American Veterans also testified regarding the importance of 
effective strategic planning for the VA.
    The subcommittee believes that long-term follow-up is 
necessary throughout the 106th Congress for proper oversight of 
the VA's Results Act implementation. How well VA plans 
strategically over the next several years will have a profound 
impact on its ability to effectively and efficiently deliver 
the benefits and services Congress has mandated for veterans.
    On September 25, 1997, the subcommittee held its second 
hearing on the VA's efforts to achieve year 2000 (Y2K) computer 
compliance. The previous hearing focused on the efforts within 
the Veterans Benefits Administration (VBA). This hearing 
addressed both the Y2K compliance efforts of the Veterans 
Health Administration (VHA) and department-wide activities. The 
subcommittee heard testimony from the GAO, the VA and the FDA 
on Y2K implications for medical devices and equipment.
    GAO in its testimony recognized that the VA had made 
progress, but that much remained to be done to avoid widespread 
computer failures. If left uncorrected, the types of possible 
problems that would occur included lack of patient scheduling 
for hospital treatments, misinterpretation of patient data and 
late or inaccurate benefits payments. According to GAO; if the 
VA were to avert serious disruption, it would need to address 
these issues.
    GAO described VA's Y2K challenge in healthcare as enormous 
and a patient safety issue. VHA was in the initial stages of 
assessing the compliance of its mission critical systems. It 
did not plan to complete assessment until January 1998, and 
renovations until July 1998. To effectively assess and 
renovate, the VA needed to understand how local facilities were 
using national applications. GAO stated that the VA did not 
know which local facilities had customized national 
applications and whether they were also Y2K compliant; that 
physical facilities were identified as another area of concern; 
and that VHA had not completed an inventory of facilities' 
related systems and equipment such as ventilating systems, 
security systems and disaster recovery systems. GAO identified 
these issues as vital to providing health care services. GAO 
noted that the impact of biomedical device failures because of 
Y2K had not been determined. GAO stated that the impact of 
medical device failures could range from incorrect formatting 
of a printout to incorrect operations of the device having a 
potential to affect patient care or safety. According to GAO, 
in an attempt to precisely determine this impact, VHA sent 
letters to manufacturers. Based on the poor response received 
from its first letter, VHA sent more detailed letters asking 
more specific questions to 1,600 manufacturers on September 9, 
1997.
    FDA, in its role of protecting the public from unsafe or 
ineffective medical devices, was encouraged by this 
subcommittee's previous hearing on Y2K to communicate with 
manufacturers. FDA stated that it had sent a letter in early 
July 1997 to about 13,000 manufacturers. According to FDA, one 
response was received to this letter.
    While the subcommittee believes the VA has indeed made 
significant progress on Y2K compliance, the VA's Y2K situation 
should be carefully monitored until the VA achieves full 
compliance. Therefore, the subcommittee will continue to 
closely follow the VA's efforts to ensure that their computer 
systems will be able to provide uninterrupted benefits and 
safe, quality health care to our veterans. The subcommittee 
believes follow-up hearings are necessary in the 106th Congress 
to review the VA's progress.
    On October 23, 1997, the subcommittee heard testimony on 
mismanagement issues at the Charleston, SC, and Pittsburgh, PA, 
VA medical centers (VAMC). Congressional requests for 
investigations of complaints about these medical centers 
prompted this hearing. The hearing focused on wasteful spending 
and mismanagement by certain VHA senior executives, and the 
VA's failure to hold the responsible executives accountable. 
The VA Inspector General testified that the investigation by 
his office of 27 allegations of mismanagement at the Charleston 
VAMC substantiated examples of wasteful spending, favoritism, 
and non-accountability. The IG testified that the former 
director had spent $571,831 renovating a nursing home care unit 
and never utilized it for that purpose. The IG testified that 
its review also substantiated that the former director 
renovated his office suite without the required advance 
approval for VA Central Office on renovation costs; that the 
former director spent $26,119 for a fish tank for the hospital 
lobby; and that the fish tank purchase came at a time when 
employees were faced with furloughs and potential budget cuts. 
The IG review indicated that the former director hired a 
management consultant and inappropriately paid the consultant 
$1,200 per day plus expenses for working 4 days per month; that 
the medical center paid the consultant $177,867 during fiscal 
years 1995 and 1996; that the former director did not 
specifically define the consultant's duties; and that the 
medical center's consultant contract did not have any specific 
work statements or fixed periods of work.
    At the Pittsburgh VAMC, the IG found the director 
authorized wasteful spending on his government quarters. The IG 
concluded that the medical center spent $201,000, which was 
$79,000 more than could be properly spent on renovating the 
director's quarters. According to the IG investigation, among 
the upgraded amenities approved by the director were a new 
stove that cost $1,500 more than those in other quarters; a 
$439 built-in microwave oven which was expressly prohibited by 
VA policy; new cherry wood cabinets, kitchen islands and new 
hardwood floors not found in any other facility quarters; a 
$2,200 whirlpool bathtub; and $500 lavatory faucets.
    The subcommittee should continue oversight of VA's 
management practices in the 106th Congress.

Second Session

    The subcommittee met on January 28, 1998, to receive 
testimony regarding waivers of regulations governing burial at 
Arlington National Cemetery (Arlington). In May 1997, the 
majority staff of the Committee had been provided anonymous 
information that called the waiver process into question. At 
the request of the subcommittee Chairman and Ranking Democratic 
Member, and the full Committee Ranking Democratic Member, the 
General Accounting Office conducted an expedited review of the 
waiver process. GAO presented its findings at the hearing, and 
outlined policy options concerning possible improvements to the 
eligibility process for burial at Arlington. The findings 
revealed a flawed waiver process marked by unclear standards 
and inconsistent applications of waiver criteria. The hearing 
highlighted that Arlington's eligibility criteria, unlike all 
other national cemeteries, were defined only by Army 
regulations and not by law.
    Prior to the hearing, the Department of Defense, Department 
of the Army and Arlington National Cemetery provided the 
information and documentation requested by the subcommittee 
regarding secretarial and presidential waivers. In November 
1998, a White House assertion of executive privilege with 
respect to two documents relating to the Lawrence waiver was 
resolved through an accommodation agreed upon by the White 
House and the subcommittee. However, the White House's limited 
cooperation and production of documents restricted the ability 
of the subcommittee and GAO to review presidential waivers 
granted since 1993. Despite these obstacles, the subcommittee 
was able to acquire extensive information concerning Arlington 
and documentation regarding secretarial and past presidential 
waivers since 1967.
    The subcommittee heard testimony about the burial waiver 
granted by the Secretary of the Army for Ambassador M. Larry 
Lawrence's burial at Arlington. The subcommittee investigation 
revealed that Ambassador Lawrence had falsely claimed merchant 
marine service and a serious wound during World War II. The 
Department of State apparently failed to discover the false 
claim during Ambassador Lawrence's background check for his 
ambassadorial nomination and his top secret security clearance. 
At the request of his widow, Ambassador Lawrence's remains were 
disinterred from Arlington.
    The subcommittee also heard testimony about the burial 
waiver granted by President Clinton for Dr. C. Everett Koop, 
Surgeon General of the Public Health Service during the Reagan 
Administration. The subcommittee investigation revealed that 
Dr. Koop had received a burial waiver for Arlington in 
violation of Arlington's regulations against reservations for 
living persons, and that he was not a veteran of military 
service, although he served in the U.S. Public Health Service 
as a commissioned officer. He subsequently withdrew any claim 
of right to burial at Arlington.
    As a result of the hearing, a bipartisan bill, H.R. 3211, 
was introduced to reform and codify Arlington burial 
eligibility, and to eliminate waivers. The House passed the 
measure 408-0. (For further discussion of H.R. 3211, see p. 
53.) The Senate did not take up the legislation. The Army 
voluntarily has begun to notify the interested congressional 
committees when waivers are granted and is reviewing its 
Arlington regulations.
    The subcommittee recommends that active oversight of 
Arlington burial waivers continue to ensure that needed 
revisions are made to the Army's regulations on Arlington 
because codification of burial eligibility is uncertain. The 
subcommittee further recommends that additional investigation 
occur in the 106th Congress on the questions remaining 
unanswered about White House actions and participation in the 
Lawrence and Koop burial waivers. Questions also remain 
unanswered about the Department of State's background 
investigation for the Lawrence nomination. The Office of the 
Inspector General, Department of State, has a review of the 
background investigation under way, but it has been delayed 
indefinitely due to an active criminal investigation by the 
Department of Justice which includes Ambassador Lawrence.

                            OTHER ACTIVITIES

    On June 5, 1997, Chairman Everett requested that the VA 
Office of the Inspector General (IG) investigate numerous 
allegations received by his office staff of mismanagement and 
misconduct at the Tuskegee and Montgomery VA medical centers, 
which now form the Central Alabama Veterans Healthcare System. 
The IG interviewed more than 35 witnesses under oath and 
additionally interviewed approximately 132 individuals of the 
VA staff and community. This was the largest IG hospital 
investigation ever conducted because of the large number of 
allegations received by Mr. Everett and the IG. Of more than 
129 allegations, over 50 percent were sustained, the largest 
number ever sustained in a IG investigation.
    Serious allegations sustained in the IG report released on 
September 29, 1998, included the following: the Director 
authorized $83,522 more than was allowed for Director's and 
Associate Director's quarters renovations and did not obtain 
approval for the renovations, including air conditioning 
systems with excessive capacity, two toilet flush valves 
costing $327 each and basement waterproofing work for the 
director's quarters costing $98,630; the Director misused 
appropriated funds to have a new icemaker installed on his 
personal refrigerator, and the Director and Associate Director 
attempted to cover up the incident; the Director improperly 
used his government credit card for personal purchases; the 
Director interfered with the IG investigation and refused to 
provide the IG access to information until directed to do so by 
his superiors; the Director and the Associate Director in 
violation of federal law engaged in prohibited personnel 
practices in the selection of several service chiefs who, as VA 
employees, complained to or cooperated with the IG, GAO, and 
Mr. Everett; the Associate Director violated federal nepotism 
laws and engaged in a prohibited personnel action by advocating 
the employment of his son; the Associate Director was 
reimbursed $4,392.90 in improperly claimed relocation expenses; 
and the medical center's fire alarm system did not work 
properly.
    Other serious allegations the IG investigation sustained 
were: 10 of the 13 Tuskegee medical center staff with 
government American Express cards misused them; the medical 
center's canteen food service had not received required 
sanitation inspections for several years; the nursing staff 
took excessive sick leave and management did not monitor such 
use (87% of sick leave earned); and weaknesses existed in 
procedures for recording overtime in the Tuskegee medical 
center nursing service;
    The IG report also found inappropriate and inadequate care 
to VA patients, including that: clinicians did not ensure 
patient meal feedings, tube feedings, and patient weightings 
were properly managed or monitored; nursing employees did not 
feed some patients who were unable to feed themselves and some 
employees were found to have eaten patients' meals; the 
Director failed to discipline employees involved in a confirmed 
allegation of patient abuse; cardiac monitors in the Intensive 
Care unit and Emergency Room were turned off by being 
``silenced''; and, eight specific instances of inappropriate 
patient care at the Tuskegee and Montgomery medical centers.
    VA follow-up on corrections and disciplinary actions is 
incomplete. The subcommittee recommends continued oversight of 
VA's corrective actions for Tuskegee and Montgomery in the 
106th Congress.

                           COMMITTEE WEB SITE

    The Committee's web site (http://www.house.gov/va) is a 
source of information on Committee activity and a gateway to 
veterans resources. Activity on the site grew from 
approximately 18,000 visits during the early months of the 
105th Congress to a high of 70,504 visits in October 1998. The 
site contains over 1,500 files, with new files being added 
weekly.
    The site's Home Page has a table of the contents, 
highlights of current issues, and a photo gallery, which has 
photos of recent hearings. The site includes a search engine 
and a Tour of the Site with a web index and links to other 
House sites. The site also consists of seven other categories 
of information: About the Committee, Veterans' Information, 
Issues, Communications, Hearings, Legislation, and the 
Democrat's Home Page.
    For the 105th Congress, the site includes the text and 
summaries of all veterans' legislation that was enacted and the 
text of all committee and subcommittee hearings. Whenever 
possible, witness statements for each hearing are posted on the 
site within two hours after the hearing is concluded. On its 
own pages and with its links to other web sites, including the 
Department of Veterans Affairs, the Committee's web site 
features information for veterans that is both easy to access 
and the most comprehensive ever available.
                 OVERSIGHT PLAN FOR THE 105TH CONGRESS

    In accordance with clause 2(d) of Rule X of the House of 
Representatives, the Committee on Veterans' Affairs has adopted 
by resolution of February 13, 1997, its oversight plan for the 
105th Congress.
    This oversight plan is directed at those matters which are 
most in need of oversight within the next two years. The 
Committee is cognizant of the requirement that it conduct 
oversight on all significant laws, programs, or agencies within 
its jurisdiction at least every ten years. To ensure 
coordination and cooperation with other committees having 
jurisdiction over the same or related laws, the Committee will 
conduct member and staff meetings as necessary with the 
Committee on National Security, the Committee on Education and 
the Workforce, and the Committee on Government Reform and 
Oversight. Additionally, the Committee will explore with these 
committees possibilities for conducting joint hearings.
    The Committee expects to conduct oversight through a 
variety of sources. They will include existing and requested 
reports, studies, estimates, investigations and audits by the 
Congressional Research Service, the Congressional Budget 
Office, the General Accounting Office, and the Offices of the 
Inspectors General of the Departments of Veterans Affairs and 
Labor. Additional sources of information will be veterans' 
service organizations, military associations, other interest 
groups and private citizens. A series of joint hearings is 
scheduled with the Senate Committee on Veterans' Affairs at 
which veterans service organizations and military associations 
will present to the committees their national resolutions and 
agendas for veterans.
    Avenues of oversight will be committee and subcommittee 
hearings; field and site visits by members and staff; and 
meetings and correspondence with interested parties. While this 
oversight plan sets forth the areas in which the Committee 
expects to conduct oversight, additional matters may be 
incorporated into the Committee's plan as the need arises.

                         Subcommittee on Health

    1. Veterans Health Administration (VHA) Budget. The 
operation of the VA health care system, the largest integrated 
health care provider in the country, represents the most 
visible component of the nation's ongoing commitment to 
America's veterans. With a medical care budget of some $17 
billion, VA provides about three million veterans care 
annually. Through focused analyses and full committee hearings, 
VHA spending choices will undergo careful scrutiny. Winter 1997 
and winter 1998.

    2. Persian Gulf War Illnesses. The full Committee will 
address the broad spectrum of issues raised by Persian Gulf War 
veterans' continuing to experience illnesses that may have 
their cause in service. The subcommittee will maintain 
continuing oversight of issues relating to VA care-delivery and 
research associated with this problem, and any need for 
additional legislation. Spring and summer 1997.

    3. Resource Allocation. VA plans to implement a new 
resource allocation formula aimed at correcting historic 
geographic imbalances and shifting funds so that veterans have 
similar access to care regardless of the region of the country 
in which they live. The subcommittee, in conjunction with the 
Subcommittee on Oversight and Investigations, will review and 
analyze the plan and the extent to which it would meet its 
stated objectives. Spring 1997.

    4. ``Eligibility Reform'' Implementation. The enactment of 
an ``eligibility reform'' law (Public Law 104-262) aimed at 
eliminating barriers to access to VA outpatient care raises a 
series of implementation issues, involving both VA's statutory 
construction and its policy choices. Close oversight will 
provide opportunities to ascertain whether VA is appropriately 
meeting the law's intent and whether there exists a need for 
additional legislation. Summer 1997 and summer 1998.

    5. Decentralization of VA Health Care System. In 
decentralizing medical center management and administration to 
facilitate restructuring health care delivery and clinical 
programs, VA headquarters has replaced central office direction 
of local actions with performance measures and other incentives 
for efficient, quality services. However, the subcommittee has 
concerns that network directors can take far-reaching actions 
without headquarters' approval, and management ``solutions'' 
can vary from one network to the next, with substantial 
inconsistency across the country. The subcommittee will review 
the degree to which decentralized decision-making is altering 
the national character of the VA health care system, and the 
need for any remedial action. Spring 1997.

    6. Ambulatory Care Programming. The subcommittee held 
hearings during the 104th Congress on VA policies regarding the 
establishment of new ``access points'', and initiated 
legislation to eliminate barriers to VA provision of routine 
ambulatory care. The subcommittee will examine further VA 
policies, strategic plans, and progress in shifting a hospital-
based system to a more ambulatory care-based system. Fall 1997.

    7. VA Role in Long-term Care. VA expends approximately $1.5 
billion to provide veterans long-term care through in-house 
programs, community-based care, and State veterans homes. 
Several questions exist regarding the relative costs and 
quality of the three options and the criteria used to determine 
in which of the three a veteran is placed. The Committee will 
examine whether the mix of the three should be changed; and 
whether the eligibility criteria--under which some veterans get 
unlimited, free care from VA; others pay under the State 
program, while still others are limited to a six-month 
placement for community care--should be changed. The need for 
statutory changes in the State home per diem and construction 
programs will also be reviewed. Spring 1998.

    8. VA Specialized Medical Programs. Public Law 104-262 
requires VA to maintain its capacity to provide for the 
specialized needs of disabled veterans through such clinical 
programs as post-traumatic stress disorder care, prosthetics, 
and spinal cord injury care and rehabilitation. Achieving the 
goals of this provision during a period of restructuring and 
downsizing will require ongoing oversight. Fall 1997 and summer 
1998.

    9. VA Mental-health Care Programs. VA mental-health 
programs are not only vulnerable special disability programs at 
risk in the current budget environment, but have historically 
been underfunded and reflect widely varying degrees of quality. 
A statutorily required evaluative report will provide a vehicle 
for oversight of these important programs, and exploration of 
remedial avenues. Spring 1998.

    10. VA Sexual-trauma Counseling Services. Revelations 
regarding sexual abuse at military training facilities and high 
rates of sexual harassment experienced by women service-members 
highlight the importance of reviewing the adequacy of VA sexual 
trauma counseling programs. Such oversight will also consider 
the need, if any, for additional legislation to provide needed 
counseling and treatment authority. Summer 1997.

    11. Women Veterans Health Care. While more than 12 percent 
of our Armed Forces are women, VA treatment programs focused 
specifically on the needs of these women veterans are 
relatively new. The extent to which women veterans use, or fail 
to use, VA health care, and the barriers or perceived barriers, 
to seeking such care will be examined. In that connection, the 
availability and quality of gender-specific care will be 
reviewed, to include privacy issues, the availability of 
appropriate supplies, and related matters. Fall 1997.

    12. Status of VA/DoD Sharing of Health Resources. A hearing 
during the 104th Congress demonstrated that opportunities for 
greater VA/DoD collaboration have not been fully exploited and, 
that despite recognition of the benefits of VA/DoD jointly 
providing care in the same facility, such joint ventures have 
not necessarily been evenhanded, particularly where VA has not 
had operational control of the facility. The subcommittee will 
review the extent to which the departments have initiated 
changes. Fall 1997.

    13. VA Research Program. The VA research program 
complements the Department's medical care mission. As a 
national research program aimed at improving the medical care 
and health of veterans, the program is funded by an 
appropriation account which supports medical research, outcomes 
and health systems research, and prosthetics research and 
development. The subcommittee will review the operations of the 
research program; examine the appropriateness of the balance 
between VA's basic, applied and outcomes research; and review 
VA efforts to enter into research partnerships with non-Federal 
entities. Winter 1998.

    14. Construction Planning. VA major medical construction 
budgets have shrunk substantially in recent years. Given 
competing needs within the VA system for construction of 
outpatient additions, environmental improvements in decades-old 
facilities, and seismic upgrades, the subcommittee will give 
heightened scrutiny to the manner in which VA establishes its 
construction priorities and associated funding plans. Winter 
1998.

    15. Medical Marketplace Forces and the VA. The provision of 
VA health care takes place in the context of a dynamic medical 
``marketplace'', in which changes in other Federal health care 
programs, changes in medical practice and technology, and 
economic changes have an impact on VA and on demand for VA 
care. The subcommittee will study these phenomena and on how VA 
has positioned itself to anticipate and respond to such 
changes. Spring 1998.

    16. Roles of the VHA's Medical Inspector and the VA 
Inspector General's Office of Healthcare Inspections. Budget 
considerations, organizational accountability, and quality-of-
care concerns highlight the importance of examining what appear 
to be overlapping responsibilities in these two offices. The 
subcommittee will examine the statutory responsibilities and 
operational roles of the respective offices, whether those 
statutory provisions and roles continue to reflect best 
practices and policies, whether the quality assurance 
objectives underlying those laws are being realized, and 
whether legislative changes in this area should be considered. 
Spring 1998.

    17. Performance of Senior Managers. The subcommittee will 
study VA practices for identifying and handling poor job 
performance on the part of senior VHA executives, and the 
extent to which past practices of simply reassigning, rather 
than removing, poorly performing managers continues to be a 
practice. Summer 1998.

    18. Use of Nurse Practitioners and Physician Assistants. 
The subcommittee will review how well and how consistently VHA 
uses these ``physician-extenders'' in primary care and other 
patient care programs. Barriers to greater use of such staff 
and the extent to which these staff receive appropriate 
supervision will also be examined. Fall 1998.

    19. Physician Pay. VA physician pay rewards longevity and 
medical specialization. The subcommittee will examine the 
continued relevance of these factors in providing ``special 
pay'' to physicians, and the merits of revising the pay system 
to draw distinctions on the basis of performance measures. 
Spring 1998.

                        Subcommittee on Benefits

    1. Veterans Benefits Administration (VBA) Fiscal Year 1998 
Budget. Funding for VBA programs and administration comprises 
over one half of VA total budget. VBA is responsible for a wide 
range of benefits such as disability compensation, pension, 
survivors benefits, education benefits, housing and insurance. 
A hearing will highlight VBA spending in the areas of 
administration and information technology. Winter 1997 and 
winter 1998.

    2. Veterans Claims Adjudication Commission. The Commission 
has released its final report containing findings, conclusions 
and recommendations on ways to improve veterans benefits claims 
processing. Hearings will review the report and receive 
testimony from veterans service organizations, the VA and other 
interested parties. Spring 1997.

    3. Veterans Employment and Training Service (VETS). The 
Department of Labor's Veterans Employment and Training Service 
is responsible for administering a state grant program to 
provide job placement for veterans. In addition to federal 
Directors and Assistant Directors of Veterans Employment and 
Training (DVETs and ADVETs) in each state, there are about 
3,000 Disabled Veterans Outreach Program Specialists (DVOPS) 
and Local Veterans Employment Representatives (LVER) working 
for the state employment services funded by this grant program. 
The subcommittee will review the funding and operations of VETS 
using principles identified in the Government Performance and 
Results Act (GPRA) format. Spring 1997 and spring 1998.

    4. Compensation and Pension (C&P) Programs. VBA's largest 
program administers the service-connected disability 
compensation and non service-connected pension programs. 
Currently, there are about 2,500,000 veterans receiving 
compensation and about 400,000 receiving pension. The veterans 
community continues to voice significant concerns about the 
quality of claims adjudication and the length of time it takes 
to process claims. The subcommittee will review the operations 
of the C&P Service, using GPRA principles. Spring 1997 and 
spring 1998.

    5. Persian Gulf Veterans' Compensation. Public Law 103-446 
authorized payment of disability compensation to Persian Gulf 
veterans suffering from undiagnosed illnesses. To date, VA's 
handling of these claims has been inconsistent and VA is now 
reviewing all previously processed claims. The subcommittee 
will review processing with an emphasis on determining the 
adequacy of VA's efforts and implications for future 
legislation. Summer and fall 1997, winter 1998.

    6. Vocational Rehabilitation. The subcommittee believes 
that vocational rehabilitation should be VA's most important 
program for service-disabled veterans. The program provides up 
to 48 months of training, education, and rehabilitation at no 
cost to the veteran. In addition, enrollees receive a monthly 
living stipend. GAO has strongly criticized this program in 
several reports, but little seems to have changed in VA's 
operating methods. The subcommittee will use GPRA principles 
for the hearing and review VA's plans to reorganize the 
program. Summer 1997 and summer 1998.

    7. Uniformed Services Employment and Re-employment Rights 
Act (USERRA). During the 103rd and 104th Congresses, USERRA was 
passed to improve a veteran's ability to return to a job held 
prior to being called to active duty. The subcommittee is aware 
of possible systematic violations of the law by one or more 
federal agencies and intends to review this issue. Summer 1997.

    8. National Cemetery System (NCS). Today, VA operates 114 
national cemeteries, about half of which are open for initial 
interments. The remainder are either open only for interment of 
second family members or closed to all further interments. NCS 
has completed about half of a 10 cemetery expansion program 
which began in the mid-1980's. The subcommittee will use GPRA 
principles to review the NCS budget and determine whether NCS 
is expanding in the most cost-effective manner. Summer 1998.

    9. VA Education Programs. Today VA provides education 
benefits to nearly 200,000 veterans and dependents or 
survivors. The best known of VA's education programs, the 
Montgomery GI Bill, provides a monthly basic benefit of $427 to 
veterans who complete a three-year period of service and have 
their pay reduced by $1200 during the first year of service. 
Using GPRA principles, the subcommittee intends to review 
program administration and alternative means of leveraging the 
existing benefit payment. Summer 1997 and summer 1998.

    10. Compensation of Veterans with Dual Diagnoses of Mental 
Illness and Substance Abuse. The subcommittee is concerned that 
compensation payments act as an enabler to some mentally ill 
veterans who are also substance abusers. There is some evidence 
that hospitalization rates of these veterans for problems 
relating to substance abuse, especially cocaine, is related to 
the arrival of compensation payments. The subcommittee intends 
to provide an opportunity for a public discussion of the very 
complex issues surrounding mentally ill/substance abusing 
veterans. Fall 1997.

    11. Board of Veterans' Appeals. The Board is the first 
forum for a veteran to appeal a VA decision on a claim for 
benefits. Prior to the advent of the Court of Veterans Appeals 
in 1989, the Board took about six months to decide an appeal. 
Today, because of many factors, it now takes about two years. 
The subcommittee intends to review Board operations using GPRA 
and the recommendations of the Veterans Claims Adjudication 
Commission. Fall 1997.

    12. Disabled Veterans Outreach Program Specialist and Local 
Veterans Employment Representatives (DVOPS and LVER's). The 
state grant program operated by DoL's Veterans Employment and 
Training Service funds about 3,000 LVERs and DVOPS whose job is 
to provide employment services to veterans. These federally-
funded state employees also provide instruction at Transition 
Assistance Programs sites for those about to leave active duty. 
The subcommittee has asked GAO to evaluate the performance of 
this program and expects the report to be issued in the fall of 
1997. At that time, the subcommittee will review the GAO's 
findings and recommendations. Fall 1997.

    13. Homeless Veterans. VA, DoL, and HUD provide funding for 
homeless veterans programs. The subcommittee, in conjunction 
with the Subcommittee on Health, will review the operation and 
funding of VA's homeless grant programs. The subcommittee will 
determine whether VA is in compliance with the Sense of 
Congress expressed in Public Law 103-446, which supported 
funding for homeless veterans' programs more closely 
proportional to the population of homeless veterans. The 
subcommittee will also examine whether these programs are 
accomplishing their goals. Spring 1998.

    14. Agent Orange, Ionizing Radiation and Prisoners of War 
(POW). VA provides medical treatment and compensation benefits 
to veterans suffering from exposure to agent orange and 
ionizing radiation, as well as to those veterans who were 
POW's. The subcommittee intends to review the problems facing 
each of these special category veterans. Summer 1998.

    15. Veterans' Benefits in the Year 2000. Technology will 
have a major impact on the delivery of veterans benefits. The 
subcommittee will examine how technology will improve the 
effectiveness of the delivery of benefits. The VA and DoL 
benefits programs relating to veterans education and employment 
will be of special interest to the subcommittee. Summer 1998.

    16. Court of Veterans Appeals. The Court is an executive 
branch court empowered to review decisions of the Board of 
Veterans' Appeals. The subcommittee will review data on the 
Court's operations and the impact on VA claims processing. Fall 
1997.

              Subcommittee on Oversight and Investigations

    1. Exposures to Environmental Hazards during the Persian 
Gulf War. The subcommittee will follow up the full Committee 
hearing on Persian Gulf War Illnesses held February 11, 1997, 
with continuing oversight on the experiences of U.S. military 
personnel who served in the Southwest Asia theater. The 
Presidential Advisory Committee on Gulf War Veterans' Illnesses 
found ``substantial evidence of site-specific, low-level 
exposures to chemical warfare agents'', and called for further 
investigation of possible chemical or biological warfare agent 
exposures. The subcommittee plans to coordinate closely with 
the Committee on National Security and its subcommittees on 
these and other environmental hazards. Spring 1997.

    2. Quality Assurance/Risk Management. The subcommittee will 
examine VA's initiatives in developing a departmental quality 
assurance/risk management program to monitor adverse outcomes 
in a time sensitive manner. The subcommittee is particularly 
concerned about suspicious deaths that occurred at the Harry S 
Truman Veterans Administration Medical Center (VAMC), Columbia, 
MO, and the Northampton VAMC, Northampton, MA. The subcommittee 
is also concerned that the Federal Bureau of Investigation 
(FBI) still considers their criminal investigation of the 1992 
deaths at the Harry S Truman VAMC an open case. The FBI exhumed 
the remains of 13 veterans in February and March of 1993 and 
contracted for toxicological testing in June 1996. These tests 
have not been concluded. Spring and fall 1997.

    3. Decision Support System (DSS). DSS is a computer based 
system that provides VA managers and clinicians data on 
patterns of patient care and patient outcomes. It can be used 
to analyze resource utilization and the cost of providing 
healthcare services. VA operates the largest federal healthcare 
system in the nation, yet lacks a detailed clinical and 
financial information system to report the efficiencies and 
operating costs of its 173 hospitals. VA expects DSS to expand 
to 91 hospitals by February 1997, despite problems identified 
by GAO in the implementation testing. The subcommittee will 
review VA's development of a business strategy and efforts to 
implement DSS. Spring and winter 1997, spring 1998.

    4. Procurement of Automated Information Resources Solutions 
(PAIRS). The subcommittee will review VA's decision to make 
this $875 million contract a 100 percent small business set-
aside. The subcommittee will also study VA's risk assessment in 
its decision making process. This critical information 
technology procurement is a cornerstone of VA's entire computer 
modernization effort with a significant effect on veterans 
services. Spring and winter 1997.

    5. Veterans Benefits Administration (VBA) Modernization. 
VBA is in its eleventh year of implementing its computer 
modernization to enhance benefits and services delivery. Only 
in the last two years has VBA made real progress in its $300 
million effort. The subcommittee will continue oversight of 
VBA's reengineering of its business practices and its 
initiation of alternative business practices, technology, and 
claims processing approaches to enhance the efficiency of VA 
benefits operations. Spring and fall 1997, spring and summer 
1998.

    6. Master Veterans Record (MVR). The subcommittee will 
review the VA's efforts to integrate its separate databases and 
information systems into a department-wide information sharing 
initiative that electronically communicates data between all VA 
organizations. The completion of the MVR project would provide 
all VA organizations, veterans and their beneficiaries with an 
integrated system that furnishes information such as timely 
death notifications, changes of address, family status, 
representation, appeals, bankruptcy, patient care and burial 
locations. Summer and winter 1997.

    7. Veterans Health Resource Allocation. The subcommittee, 
in conjunction with the Subcommittee on Health, will review and 
analyze the Veterans Health Administration's new resource 
allocation plan, known as the Veterans Equitable Resource 
Allocation System, and the extent to which it would meet its 
stated objectives. Spring 1997.

    8. Civilian Health and Medical Programs of the Department 
of Veterans Affairs (CHAMPVA). Currently, there are 
approximately 80,000 CHAMPVA beneficiaries and in 1994, they 
generated over 800,000 medical claims. Annual program 
expenditures are in excess of $93 million, and claims total 
$85.1 million. The subcommittee will review the effectiveness 
of program management controls for duplicate claims payments, 
eligibility verification, and recovery of fraudulent claims 
payments. Fall 1997.

    9. Medical Care Cost Recovery (MCCR). VA collects over $500 
million per year from third party insurers for medical care 
provided to insured veterans. The subcommittee will review the 
VA's collection rate success, the adequacy of the billing rates 
based on the quantity and cost of care provided to veterans, 
and the cost of collections. Spring 1997 and spring 1998.

    10. Adopting Medicare Fee Schedules for Fee Basis Care. 
Veterans Affairs Inspector General (VAIG) audits estimate that 
VA could increase revenues by $33 million by adopting the 
Medicare fee schedules for fee basis veteran care. The 
subcommittee will review application of these schedules to VA. 
Fall 1997.

    11. Capital Medical Equipment Backlog. The subcommittee 
will review the backlog of capital medical equipment and VA's 
acquisition strategy. Fall 1997 and fall 1998.

    12. Procurement Management. The subcommittee will review 
VA's overall procurement process. The review will include the 
efficiencies of the National Acquisition Center (NAC), 
initiatives in electronic commerce, centralized acquisitions, 
performance-based contracting and acquisition streamlining. 
Further, the subcommittee will review instances of vendor 
overcharges and contractor fraud, and departmental measures 
instituted to deter future incidents. Summer 1997 and summer 
1998.

    13. Construction Delays. The subcommittee will review GAO 
and VAIG findings of weaknesses in VA's construction management 
process. VAIG has conducted thirteen audits in the past five 
years detailing construction overruns. Spring 1997 and spring 
1998.

    14. Veterans Affairs Inspector General Activities. The 
subcommittee will review the VAIG's five year strategic plan. 
The review will include the focus, conduct, and outcomes of the 
last four years of audits, investigations, and hot-line and 
whistleblower activities. Summer 1997.

    15. Food Service. Veterans Health Administration (VHA) is 
unusual as a health care delivery system in that it operates 
its own food service systems. The subcommittee will review 
VHA's food service operations and request a GAO cost-benefit 
analysis. Fall 1997 and fall 1998.

    16. Administrative Staffing Redundancies in VHA/VBA 
Colocations. As VA continues to reengineer its business 
processes, the subcommittee will examine possible staffing 
redundancies in contracting specialists, payroll/finance 
personnel, equal employment opportunity specialists and human 
resources personnel. Summer 1997 and summer 1998.

    17. Government Performance and Results Act of 1993 (GPRA). 
Public Law 103-62 requires the federal government to measure 
its performance and report on its results. It was enacted in 
July 1993 and will be applied to all federal departments and 
agencies. The subcommittee will closely monitor how VA measures 
outcomes; how well GPRA performance goals drive daily VA 
operations; how performance information is used to improve 
effectiveness; what progress is being made to build the 
capacity necessary at VA to implement GPRA; and what steps are 
being taken to align VA's core business processes to support 
mission-related outcomes. Spring, fall, winter 1997 and spring, 
fall, winter 1998.

    18. Advisory Committee on Minority Veterans. The Advisory 
Committee makes assessments of the needs of veterans who are 
minority group members and reviews VA programs and activities 
designed to meet such needs. The subcommittee will examine the 
report and any recommendations of the Advisory Committee to the 
Secretary of Veterans Affairs due July 1 of each year. Summer 
1997 and summer 1998.

    19. Veteran Canteen Service (VCS), General Post Fund, and 
Golf Courses. The subcommittee will review the VCS for scope of 
missions, federal subsidizations and annual financial 
statements. The subcommittee will review utilization of the 
General Post Fund in accordance with chapter 83 of title 38 of 
United States Code. The subcommittee will also review VHA's 
efforts to operate its twenty-two golf courses without 
appropriated funds. Fall 1997 and fall 1998.

    20. VA Buyout Plan under Public Law 104-208. VA has offered 
voluntary separation incentive payments to support strategic 
downsizing goals of the department. The subcommittee will 
review the VA buyout plan and the success of the following 
stated objectives: changing the skill mix of employees; 
increasing efficiencies; streamlining operations; converting to 
new methods of operations; and enhancing service to veterans. 
Spring 1997 and spring 1998.

    21. Energy Policy Act of 1992 (EPACT). EPACT authorizes VA 
to utilize energy performance contracts to leverage private 
sector capital to fund VHA energy plant retrofits and upgrades 
at healthcare facilities. The subcommittee will review VA's 
efforts to maximize the use of this contracting vehicle to 
achieve higher efficiency in energy consumption and reduce the 
need for appropriated funds. Spring and Fall 1997 and spring 
and fall 1998.

    22. VA Safety and Security. The subcommittee will conduct a 
comprehensive review of VA safety and security issues to 
include law enforcement programs, security of controlled 
pharmaceuticals, fire safety programs, and VA's 32 fire 
departments. Summer 1997 and summer 1998.

    23. Departmental Travel. VA's 1997 estimated travel budget 
is $33 million greater than its 1995 travel costs. This 
represents a 16 percent increase while the VA continues to 
downsize and acquire televideo conferencing capability. The 
subcommittee will review VA's conference, training, and other 
travel. Spring and winter 1997 and spring and winter 1998.
 REPORT TO THE COMMITTEE ON THE BUDGET FROM THE COMMITTEE ON VETERANS' 
AFFAIRS ON THE BUDGET PROPOSED FOR FISCAL YEAR 1998, SUBMITTED ON MARCH 
                                20, 1997

             Summary Table: Estimates of Committee on Veterans' Affairs For Fiscal Year 1998 Budget
                                      (Net Budget Authortiy--$ in millions)
----------------------------------------------------------------------------------------------------------------
                                                                            FY 1998         FY 1998
      Department of Veterans Affairs           FY 1996       FY 1997    Administration     Committee    Comm. +/-
                                                                            Request     Recommendation    Admin.
----------------------------------------------------------------------------------------------------------------
Veterans Benefits Administration:
  Compensation and Pension................       18,604        19,424         19,735          19,735          0
  Proposed Legislation 1..................            0             0            314             331         17
  Readjustment Benefits...................        1,155         1,377          1,366           1,366          0
  Proposed Legislation....................            0   ............             0             175        175
  Housing Programs........................          211           504            353             353          0
  Proposed Legislation 1..................            0             0           -\29               0         29
  All Others..............................           44            40             52              52          0
                                           ---------------------------------------------------------------------
Subtotal, Veterans Benefits...............       20,014        21,345         21,791          22,012        221
 
Veterans Health Administration:
  Medical Care Appropriation..............       16,551        17,013         16,959          17,600        641
  Proposed Legislation....................            0             0            591               0      -\591
Subtotal..................................       16,551        17,013         17,550          17,600         50
 
  Medical and Prosthetic Research.........          257           262            234             262         28
  MAMOE...................................           64            61             60              60          0
  State Homes and Parking.................           47            60             41              80         39
                                           ---------------------------------------------------------------------
Subtotal, Veterans Health.................       16,919        17,396         17,885          18,002        117
 
Departmental Administration:
  Construction, Major Projects............          136           251             80             200        120
  Construction, Minor Projects............          190           175            166             166          0
Subtotal Construction.....................          326           426            246             366        120
 
  VBA.....................................          633           627            661             678         17
  General Administration..................          213           201            186             186          0
Subtotal GOE..............................          846           828            847             864         17
 
  National Cemetery System................           73            77             84              84          0
  Office of Inspector General.............           31            31             31              31          0
  Grants for State Cemeteries.............            1             1             10              10          0
                                           ---------------------------------------------------------------------
Subtotal, Department Administration.......        1,277         1,363          1,218           1,355        137
                                           =====================================================================
 
Total, DVA adjusted.......................       38,210        40,104         40,894          41,369        475
  Trust funds, net........................        1,098         1,053          1,012           1,012          0
  Proprietary receipts, adjustments, and          -\719       -\1,822          -\973           -\973          0
   intragovernmental transactions.........
                                           =====================================================================
 
Total, Department of Veterans Affairs.....       38,589        39,335         40,933          41,408        475
----------------------------------------------------------------------------------------------------------------
1 Proposed Legislation may be considered in the event the Comiittee is instructed to meet budget reconciliation
  targets.

 The Committee's Views and Estimates of the President's FY 1998 Budget 
             Request for the Department of Veterans Affairs

                     Veterans Health Administration

                              Medical Care

    Veterans eligible for VA health care services confront a 
delivery system which is in flux. Major policy changes and new 
statutory requirements are being implemented through an 
organization which is still rapidly evolving. Among the changes 
underway:
    
 La shift in the primary locus of care-delivery at 
VA medical centers from the hospital ward to the outpatient 
clinic, with accompanying closures of hospital wards and 
enrollment of patients into primary care programs;

    
 Lreductions in numbers of hospital employees, to 
include reducing the number of VA physicians who are 
specialists and subspecialists and increasing the number of 
primary care physicians;

    
 Linstitution of a new capitation-based method of 
allocating medical care funds to its 22 geographic networks to 
account for workload projections and relative efficiencies of 
care-delivery;

    
 Lsubstantial decentralization of authority to 
regional network directors, who are charged to improve the 
efficiency of VA facility operations through such means as 
administrative consolidations and elimination of duplication in 
closely proximate health-care facilities, etc.;

    
 Limplementation of new health-care eligibility 
rules, which will require enrollment of veterans as a condition 
of their receiving care;

    
 Linstitution of measures to ensure maintenance of 
VA's special programs that provide for the specialized 
treatment and rehabilitative needs of disabled veterans;

    
 Lan increasing awareness of the need to serve 
patients' acute-care needs through more accessible, less costly 
means, and the growing reliance on community-based clinics to 
serve that end; and

    
 Lthe development of a national formulary for 
pharmaceuticals, national contracting for community-based 
nursing home care, and similar means of achieving economies of 
scale to increase VA purchasing power.

    In the midst of these changes, VA's responsiveness to 
veterans who turn to its health care facilities is highly 
variable:
    
 Laccess to outpatient care has generally improved, 
with increased staffing in outpatient clinics and generally 
reduced waiting times for primary care and specialty clinic 
appointments;

    
 Lyet the increasing numbers of aging veterans who 
turn to VA for nursing home care or support to avoid 
institutionalization face uncertain access as the Department 
gives far greater priority to providing for primary care (the 
budget for fiscal year 1998 promises no greater commitment to 
the aging veteran: for example, it provides for no increase in 
the numbers of veterans who will be served in community nursing 
homes).

    
 Lthe closure of inpatient psychiatric bed programs 
(with a reduction of an estimated 1,470 staff and some 4,600 
fewer patients hospitalized) raises the risk of significant 
numbers of veterans who lack support systems getting little or 
no effective continuity or management of their care and the 
specter of homelessness increasing.

    
 Lcare of Persian Gulf veterans, many of whose 
health problems are presumed to have their origin in service, 
are nevertheless receiving only superficial attention at some 
VA facilities and extensive care at others.

    The Committee has encouraged efficiency and innovation in 
VA's delivery of health services and is heartened to see such 
change in VA planning and operations. Nevertheless, the 
proposed budget for fiscal year 1998 would set veterans' health 
affairs on an unprecedented, untested course. It would 
establish a fiscal policy of holding medical care 
appropriations to a level below what the Administration 
acknowledges is needed to maintain adequate services and 
relying on nonappropriated funds and unspecified new 
efficiencies to fill that gap. As proposed, the primary source 
of those needed supplementary dollars would be third-party 
collections, primarily from health-care insurers.
    The proposed new revenues are not only dependent on 
legislation, but on projections whose reliability for fiscal 
year 1998 and the outyears is uncertain. The Administration 
budget projects that gross fiscal year 1998 collections will 
total $591 million (net recoveries after deducting the cost of 
collection would be $468 million). Yet the unreliability of 
that figure is underscored by the gap between last year's 
medical care cost recovery budget estimate of $736 million in 
total collections for fiscal year 1997 and the current estimate 
of only $540 million for that same fiscal year. The Committee's 
budget hearings highlighted the increasing difficulties facing 
VA in its pursuit of medical care cost recovery. The VA's own 
strategic plan for medical care cost recovery notes that 
``there is no methodology that can accurately estimate the 
`full collection potential' of VA's MCCR program.'' It 
acknowledges, however, that several factors pose new and 
troublesome challenges. The VA's own plan states:

        Assumptions that (1) MCCR recoveries from third party 
        payers should continue to rise and (2) operating costs 
        associated with the recovery of this revenue should 
        diminish as a result of efficiencies ignore two 
        critical facts facing third party recovery. First VHA 
        inpatient workload is diminishing, while outpatient 
        workload is increasing. Second . . . MCCR spends nearly 
        five times the amount to collect a dollar from 
        outpatient billing than it spends to collect a dollar 
        from inpatient billing . . . MCCR must also generate 
        approximately 20 outpatient bills to produce the 
        equivalent recovery of a single inpatient bill.

    The changing nature of the insurance industry and other 
factors beyond VA's control also suggest that prior-year VA 
collections successes may no longer be replicated, and indeed 
that collections could actually trend lower. The VA faces a 
rapidly changing insurance market in which fee-for-service 
models, from which VA obtains substantial payments, are giving 
way to health maintenance organization and preferred provider 
plans, from which VA generally cannot gain recoveries. 
Moreover, with the aging of the veteran population, more and 
more veterans who have insurance coverage are Medicare-eligible 
and have only Medicare-supplemental policies, from which VA 
recoveries will be markedly lower because of the limited nature 
of that coverage.
    VA certainly has the means to improve its own cost-
collection efforts, and the Committee is aware that the 
Department has mounted some promising initiatives. The 
Committee questions whether improved program administration can 
overcome the many uncontrollable factors highlighted above 
which will inevitably retard collections' success. The 
Committee applauds the concept of VA's retaining third party 
revenues and the inherent incentive it provides, while noting 
that VA has acknowledged that it lacks any plan at this time 
for making that incentive real. With changes in health-delivery 
practices and changes in the insurance market, it is clear that 
prior-year VA collection trends do not provide a reliable basis 
for concluding that outyear collections, that is collections 
for fiscal years after fiscal year 1998, will increase. The 
budget's outyear projections for medical care cost recovery are 
not only optimistic, they lack a solid foundation.
    While the outyear plans associated with holding VA medical 
care appropriations to a below-fiscal year 1997 funding level 
raise profound concerns, the plan for fiscal year 1998 is not 
without substantial problems itself. Significantly, the fiscal 
year 1998 plan raises, and fails to answer, several important 
questions, with serious funding implications:

    
 Lin light of VA's collections for FY 1997 having 
fallen almost $200 million short of its earlier projection, how 
reliable is the projection that VA would not only reverse that 
trend but increase its recoveries by $58 million in fiscal year 
1998?

    
 LThis budget provides no funds to cover what a VA 
survey reports to be new construction-activation projects for 
fiscal year 1998. A VA survey, however, identifies that 
networks anticipate that $260 million will be required to 
activate construction projects in that fiscal year, to include 
some $80 million in recurring operating costs and $180 million 
in nonrecurring costs. Those monies must be provided for at the 
expense of some other spending. While this budget proposes (at 
pp. 2-30) that VA will save more than $180 million through 
unidentified ``management efficiencies'', it is clear that the 
cost of activations, which are not even identified in the 
budget, must be funded through other managerial actions. How 
credible is it that VA can wring sufficient savings both to 
adequately fund activations as well as to help offset the 
anticipated $687 million in uncontrollable cost increases 
(i.e., required payroll increase totaling $338 million and 
inflation and rate increases of $249 million) identified in the 
budget without service to veterans deteriorating?

    These unanswered and unanswerable questions place veterans' 
health care, and veterans themselves, at risk. This Committee 
recommends the adoption of a policy that responsibly minimizes 
that risk.
    The Committee supports in principle the proposal that the 
VA's health care system should be permitted to retain medical-
care cost recoveries. It is appropriate to give VA the 
incentive to maximize its recoveries and to make veterans' 
health care the beneficiary of collections successes. It is 
also appropriate to encourage VA to achieve further economies 
through streamlining; elimination of redundancies; ``smart'' 
procurement policies; consolidations of administrative and 
other functions; and, if indicated, consideration of changing 
the mission of inefficient facilities. Some of these changes 
cannot reasonably be carried out, logistically and otherwise, 
in the space of a single fiscal year.
    In essence, this budget asserts that the Department will 
require $17.55 billion to operate a comprehensive, integrated 
health care system providing care to eligible veterans. This 
projection is not unreasonable given still available 
opportunities for streamlining, consolidation, and other cost-
saving changes in the Veterans Health Administration. In the 
Committee's judgment, the absence of any identified funding for 
construction activations means either that VA will fail to 
operate new ambulatory care expansions and other activations, 
or that it will deny care to ``category A'' veterans whom it 
has been serving. Neither course is tenable. The Committee 
recommends, accordingly, that the spending level for VA care be 
set at $17.60 billion, a more reasonable figure.
    The VA's budget makes enactment of legislation to permit 
retention of third-party collections a critical component of VA 
health care funding for fiscal year 1998. This proposed 
authority is said to give VA managers new incentives to 
increase collections. The Committee is troubled, however, that 
the architects of this budget proposal have identified no 
mechanism for distributing collection receipts, in whole or in 
part, to ensure that their theoretical incentive will actually 
be realized. The Department's budget and budget defense have 
also failed to allay the Committee's very substantial concerns 
regarding the very optimistic collections' target for fiscal 
year 1998. With the many dynamic changes underway both in VA 
medical care delivery patterns, in the insurance market, and in 
an aging veteran population, this Committee finds no 
satisfactory basis for projecting that VA's medical care cost 
collections will even approach the Administration's fiscal 
target, let alone rebound from a downward trend.
    Given the risks to our veterans of relying on this wholly 
speculative legislative gamble, the Committee recommends that 
VA medical care funding needs for fiscal year 1998, an amount 
the Committee believes should be set at $17.6 billion, be met 
through appropriations.

                            Medical Research

    VA's research budget represents less than 1.5 percent of 
the Federal budget devoted to veterans health care. Despite the 
relatively limited share of the budget dedicated to research, 
VA's research program is a critical element of the VA health 
care system.
    The conduct of research is not only a specific statutory 
mission for VA, but its research provides integral support to 
all of VA's clinical care efforts. Opportunities to conduct 
research with direct clinical application have historically 
provided a powerful incentive to attract and retain exceptional 
VA physicians. Successful VA research grant applicants must 
commit themselves to serving five-eighths to full-time in VA 
medical facilities, with a research focus that will directly 
benefit veteran patients.
    The research budget is best understood as a dividend-
producing investment. As noted, it yields patient-care 
dividends in its key role in the quality of the clinical staff 
it brings to VA patient care. But those dividends are magnified 
because of an important ``leveraging'' factor. That is, the 
investment in VA research provides a capacity through which VA 
researchers are able to bring additional research dollars 
(through non VA grant support) to advance VA research 
initiatives.
    Significantly, VA research has an outstanding record of 
scientific achievement recognized by independent, blue-ribbon 
panels. Its breakthroughs, improvements in care, and advances 
in medical and prosthetic technology have benefited not only 
veterans, but all Americans.
    It is troubling, accordingly, that the fiscal year 1998 
budget would reduce the modest level of funding by 10.5 percent 
from $262 million to $234 million. Taking inflation into 
account, the proposal represents a 15 percent cut in real 
support. The proposed cut would come at a time when VA has 
already taken important steps to refocus and streamline this 
program in accordance with recent recommendations from a 
Research Realignment Advisory Committee. At a time that this 
program should be moving to foster a new generation of 
research-oriented VA clinicians, this is a budget that could 
discourage the ``best and the brightest'' from pursuing or 
maintaining VA employment.
    Reducing the budget by $28 million will not only decrease 
the number of meritorious research studies VA can fund, it 
would also reduce VA's capacity to compete successfully for 
funds from other sources, which currently fund 78 percent of 
VA's total research effort.
    For these reasons, the Committee recommends for fiscal year 
1998 restoration of funding to the fiscal year 1997 level of 
$262 million to allow the program to remain near a current 
services level.

                       Major Medical Construction

    In carrying out its multi-faceted mission, the VA provides 
care and treatment through networks of facilities which range 
from small community clinics to complex institutions designed 
to serve veterans' specialized health care needs. Much of its 
infrastructure consists of older facilities, many of which fail 
to meet current expectations of patient privacy, comfort and 
efficient medical practice.
    Budgets for major VA construction have for years reflected 
a competition among the system's diverse needs for construction 
dollars from modernization of aging facilities to expansion of 
unmet needs for ambulatory care and nursing home care.
    The Major Construction budget should receive funding at a 
level which would allow the Department to address the most 
serious needs, especially projects which improve ambulatory 
care capacity, upgrade patient environment, and remedy seismic 
problems. It is deeply disturbing, accordingly, that the major 
medical construction budget for fiscal year 1998 proposes no 
funding for any of the projects authorized by the Congress in 
Public Law 104-262 or for any other pending, but as yet 
unfunded construction projects. Indeed, only a single project 
would win major medical construction funds, and this to 
complete seismic corrections initiated in a prior fiscal year. 
Given Congress' action in Public Law 104-262 authorizing 
appropriations for 16 as yet unfunded or only partially funded 
construction projects which remain at the top of VA's most 
recent construction prioritization scoring model, the major 
medical construction budget for fiscal year 1998 represents a 
profound disappointment to this Committee and to the veterans 
who rely on VA care. Mindful of competing budget pressures, the 
Committee recommends that the highest priority projects 
authorized last year receive funding, and recommends a funding 
level of $200 million, a $120 million increase above the 
Administration's proposal.
    In highlighting the role of construction funding in 
ensuring the provision of needed care to veterans, the 
Committee underscores the importance of adequate funding for 
the State home program. This program is a highly regarded, 
cost-effective partnership in helping to meet aging veterans' 
long-term care needs. In providing construction funding for up 
to 65 percent of the cost of construction, VA grant support 
helps assure that States can help meet the goal of providing 
veterans needed nursing home care and other long-term care. The 
States have been reliable partners in this effort, and have 
responded admirably to incentives developed by the Congress to 
expand their commitment to this program. In accordance with a 
statutory priority system for grant funding, many States have 
appropriated monies in advance to ensure priority Federal 
funding (in ``priority group 1''). At this time, however, the 
list of pending, unfunded State home projects (ranked as 
``priority group 1'') for which States have already 
appropriated their share of construction costs, has swollen to 
a total of more than $192 million.
    The fiscal year 1998 budget, proposing to cut funding for 
this program by $6 million, is an unreasonable response to the 
States. The States should be rewarded for their efforts, not 
asked to stand in line still longer waiting for sufficient 
funds to be appropriated for their projects. To ensure that 
States continue to participate in this program, and to avoid 
States reassessing whether their Federal partner is indeed 
reliable, this program should be adequately funded. The 
Committee proposes an appropriation of $80 million for fiscal 
year 1998 and strongly encourages VA to request a similar 
amount next year to help retire the backlog of projects and 
expand needed bed availability for aging veterans.

                    Veterans Benefits Administration

                       General Operating Expenses

    The General Operating Expenses account funds Full Time 
Employee Equivalents (FTEE) and operating expenses for both the 
Veterans Benefits Administration (VBA) and VA's Central Office 
(headquarters). VBA administers a broad range of non-medical 
benefits to veterans, their dependents, and survivors through 
60 regional offices or medical and regional office centers. 
These programs include compensation and pension, education, 
vocational rehabilitation, insurance, and loan guaranty (home 
loans). VBA is also responsible for processing applications for 
these programs. Headquarters includes the Secretary's staff and 
other support VA support staff, and is located in Washington, 
DC.
    The Department proposes to reduce overall VBA staffing by 
543 FTEE in fiscal year 1998. These include 265 FTEE reductions 
from four of five VBA lines of business: 100 from compensation 
and pension, 20 from education, 45 from vocational 
rehabilitation, and 100 from loan guaranty, as well as 128 FTEE 
from the Veterans Services Division. With the exception of 100 
Loan Guaranty positions, the Committee opposes the reductions 
because of the significant work remaining on major technology 
programs to improve the automation of VBA functions and the 
uncertainties surrounding Business Process Re-engineering 
(BPR). The Committee recommends $15 million to restore 293 
direct service FTEE for fiscal year 1998 for compensation and 
pension, education, vocational rehabilitation and veterans 
services.
    VA's fiscal year 1998 budget requests $1.4 million for 
customer surveys, program evaluations and an activity-based 
costing study. The Committee supports these management 
initiatives. The budget also requests $7.4 million for 
information technology initiatives to continue development of 
the new compensation and pension payment system, transferring 
the education system to a new computer, and various BPR 
initiatives. The Committee supports that request.

                       Benefit Program Operations

    Compensation & Pension Service.--The ability of the VA to 
provide timely and quality benefits delivery is heavily 
dependent on a combination of proper staffing levels, effective 
implementation of computer modernization initiatives, training 
and retention incentives, and inter-departmental cooperation 
between the various VA agencies and military service 
departments. Over the past decade the number of trained 
personnel in the adjudication division has declined by 
approximately 40 percent with a further 100 FTEE reduction 
proposed for 1998. With claims processing still averaging over 
130 days, and remand rates from the Board of Veterans' Appeals 
(BVA) exceeding 50 percent of the Board's decisions, the 
Committee opposes the FTEE reductions in the Compensation & 
Pension Service (C&P) proposed in fiscal year 1998.
    The VA continues to make progress in the direct acquisition 
of service records from the armed forces immediately following 
separation. The VA's central records center in St. Louis is 
aggressively pursuing advancements in records management and 
information handoffs between agencies. Projects such as 
automating information requests between the VA Regional 
Offices, the National Personnel Records Center and the several 
service records centers, automation of the DD-214 discharge 
form, and a VA/DoD pilot program to obtain C&P physicals for 
servicemembers about to be discharged from active duty are 
underway. The Committee fully supports this pilot effort, and 
if the data is favorable, will support expansion of the program 
throughout the VA and DoD.
    VETSNET, the computer modernization project to replace the 
VA's current benefits payment system, has been subject to 
significant internal and external scrutiny and the Committee 
remains concerned about the overall management of the program 
and the VA's ability to procure and modernize its benefits 
information management system. The year 2000 (Y2K) issue and 
its impact on the VA's data processing is especially 
troublesome. The General Accounting Office has stated that the 
VA has not demonstrated its ability to develop two major 
projects simultaneously. While the VA has made progress toward 
resolving the VETSNET and the Y2K issues, the Committee 
believes the highest resource priority should go to the Y2K 
contingency program. The contingency program involves making 
the current payment system which exists at the Hines data 
facility Y2K compatible, thus able to continue making benefits 
payments should the VETSNET effort be delayed. Further, the VA 
has not demonstrated an effective mechanism to ensure 
modernization will include maximum interface between VBA and 
VHA information systems.
    VA's telecommunications system continues to impede the 
efficient delivery of benefits. The combined blocked and 
dropped call rates routinely exceed 70 percent at some sites. 
The Committee believes the VA should allocate sufficient 
resources to modernizing its phone system with interactive 
technologies that have been available for years. These 
technologies could have significant impact on customer service 
and would free FTEE for more complex claims-related work in all 
VBA business lines. Therefore, the Committee recommends $1 
million to fund additional automated telecommunications 
capabilities. During fiscal year 1996, an average level of 
4,032 FTEE adjudicated approximately 2.66 million benefit 
claims. During the same year, VBA received 2.6 million claims. 
At the end of fiscal year 1996, approximately 342,683 claims 
were pending at VBA. The VA projects that the number of claims 
pending at the end of fiscal year 1997 will increase to 
360,523. In the past year, the VA has reduced the use of 
overtime for claims processing and the Committee commends this 
action. The Committee expects the Department to accomplish 
future reductions in the claims backlog through improvements in 
automation, business process re-engineering, increased use of 
post-decision hearing officers, statutory and regulatory reform 
in the areas of pension simplification, and Montgomery GI Bill 
certifications.
    To aid in achieving these efficiencies, the Committee also 
recommends the VA conduct, within its resources, a pilot 
program to procure and demonstrate a fully automated disability 
rating system using artificial intelligence and expert systems. 
Commercial sources have demonstrated the use of expert systems 
to perform some rating functions and the Committee is aware of 
two companies whose products are used extensively and 
successfully in worker's compensation cases. The Committee 
views such a pilot as a major initiative in improving VA claims 
processing.
    The budget requests $10.2 million for compensation and 
pension business process re-engineering initiatives including 
computer based training, continued development of the 
computerized Claims Processing System, medical examinations, 
outreach, continuation of the separation exam pilot program, 
and related BPR information technology programs. The Committee 
supports the request.
    Vocational Rehabilitation and Counseling Program.--The 
Vocational Rehabilitation and Counseling Program (VR&C) 
provides rehabilitation and counseling services for eligible 
veterans, servicemembers, and certain dependents. VR&C's 
primary mission is to provide all services and assistance 
necessary to enable service-connected disabled veterans to 
become employable, obtain and maintain suitable employment, or 
to achieve maximum independence in daily living. Additionally, 
VR&C is authorized to provide educational and vocational 
counseling services to eligible active duty members, veterans, 
and dependents. The Committee has previously stated and 
reiterates that it cannot understand why the VA does not accord 
this program the priority and the resources it clearly 
deserves.
    Despite changes restricting eligibility for vocational 
rehabilitation benefits made in Public Law 104-275, which 
overturned the Court of Veterans Appeals decision Davenport v. 
Brown, VR&C continues to experience a high volume of 
applications for chapter 31 benefits and educational/vocational 
counseling. This is due, at least in part, to the routine high 
volume of separations from the armed forces and transition 
programs designed to fully inform separating servicemembers 
about the VA benefits. Aggressive marketing of the benefit by 
veterans service organizations (VSO's) through their national 
magazines and conferences also contributes to the high demand 
for vocational rehabilitation benefits. GAO released a report 
on VR&C in 1996 which again criticized the program for falling 
short in the number of veterans completing rehabilitation and 
the inability to determine the cost of rehabilitating a 
veteran. The report also noted the high drop out rates in the 
program and the VA's inability to determine the cause(s) of 
those high rates. The Committee cannot support additional FTEE 
for the vocational rehabilitation program until these 
significant management problems are overcome. Also, because 
FTEE reductions would further decrease the level of services to 
disabled veterans through longer waiting periods and diminished 
case management, the Committee does not support the FTEE 
reductions proposed in the President's budget.
    The Committee strongly suggests that VR&C aggressively 
pursue closer cooperation with the Department of Labor's 
Veterans Employment and Training Service (VETS) to increase job 
placement of rehabilitated veterans. VETS, and other placement 
specialists, can provide significant employment services to 
vocational rehabilitation graduates. The Committee believes 
closer cooperation between VR&C and VETS will increase 
employment opportunities for disabled veterans.
    Education Service.--VA's Education Service is responsible 
for several programs, most notably the Montgomery GI Bill 
(MGIB) which provides earned education assistance benefits to 
300,000 veterans, active duty, and National Guard and Reserve 
personnel annually. In addition, the Service administers 
education programs for 43,000 survivors of veterans who are 100 
percent disabled, died of a service-connected disability or 
were killed on active duty.
    The cost of education has increased at over 7 percent per 
year since the inception of the Montgomery GI Bill. Today a 
veteran with two years of honorable military service receives 
$347 per month from the Montgomery GI Bill (MGIB). But the 
average annual cost is $9,750 for tuition, room and board, 
fees, books and transportation at a public institution. For 
private schools, the annual cost is now $20,750. The result is 
the Montgomery GI Bill falls short by $6,600 annually for a 
public school and $17,600 for a private school.
    The President's budget proposes a 10 percent increase in 
the Pell Grant program, which would increase the maximum 
benefit to 3,000 per year, about $123 less than the MGIB pays 
for a nine month school year. Additionally, the current 
AmeriCorps education benefit of $4,725 per year for two years 
exceeds the earned MGIB basic benefit on a per school year 
basis by $1,602. Therefore, the Committee requests an 
additional $175 million in fiscal 1998 to improve veterans' 
education programs.
    Consolidation of education claims processing at four 
Regional Processing Offices (RPO) is complete. While fully 
supportive of the VA's efforts to streamline education 
operations, the Committee remains concerned, however, about the 
slow processing of education claims at some RPO's. 
Additionally, the Committee is very concerned that the Stage II 
imaging project to replace old technology imaging systems is 
now one year behind schedule. The Committee recognizes the 
significant efficiencies to be gained through automation of the 
MGIB monthly certification process. Therefore, the Committee 
recommends an additional $1 million for a monthly certification 
system using touch tone phones to verify monthly enrollments. 
The Committee estimates that postal savings alone will pay for 
the system within two years. The Committee also supports the 
requested $1.049 million for the electronic data interchange/
electronic funds transfer project.
    The Committee rejects the proposed FTEE reductions for the 
education service in the President's fiscal year 1998 budget. 
Such reductions will only result in a lower level of service to 
veterans because automation and business process re-engineering 
are not yet mature enough to sufficiently increase 
administrative efficiencies.

                       Board of Veterans' Appeals

    The Board of Veterans' Appeals (BVA) continues to 
experience significant difficulties meeting the production 
levels needed to reduce the backlog of over 60,000 appeals. 
Additional resources provided over the past two years are now 
beginning to result in increased productivity. In fiscal year 
1996, the BVA made nearly 34,000 decisions. Unfortunately, over 
14,800 (43.7 percent) of those decisions were remands back to 
the regional offices. The BVA predicts that it will produce 
41,200 decisions in fiscal year 1997, which will allow its 
output to slightly exceed the estimated 38,000 appeals that 
will be filed with the Board in fiscal year 1997.
    Clearly, production trends are improving at the BVA, but 
the BVA's estimate of 504 days required to process a claim in 
fiscal year 1997 is unacceptable. It is also clear that, absent 
a marked decline in appeals from regional office decisions, 
and/or a reduction in administrative requirements, the Board in 
its current form and scope of responsibility cannot manage the 
workload. The Committee notes that the Veterans Claims 
Adjudication Commission (VCAC) made several recommendations 
concerning the Board's role in the adjudication system. Given 
the potential impact of some VCAC recommendations, the 
Committee believes BVA staffing levels should not be changed at 
this time.

                        National Cemetery System

    The National Cemetery System (NCS) provides national 
shrines honoring those who served in uniform and should be 
maintained as places of high honor, dignity and respect. 
Congress must consistently fund NCS at a reasonable level. 
Funding shortfalls will only exacerbate current staffing 
deficiencies and cause additional growth in equipment backlogs 
at a time when the number of interments in the National 
Cemetery System are projected to increase dramatically due to 
an aging veteran population.
    Currently, 149 cemeteries and soldiers' lots located in 41 
states, the District of Columbia and Puerto Rico comprise the 
National Cemetery System (NCS). Since NCS's establishment in 
1862, approximately 2.4 million decedents have been interred in 
national cemeteries and approximately 6.4 million headstones 
and markers have been furnished. Between fiscal years 1995 and 
2010, the veteran population will decrease by six million (23 
percent). As a result, NCS faces an increasing workload at 
least through fiscal year 2008. During these years, 
approximately 7.5 million veterans of the World War II 
generation will die. In fiscal year 1996, the VA interred 
71,786 veterans and family members. In fiscal year 2008, the 
number of interments is projected to increase to 104,000. The 
VA also expects to process 345,000 gravemarker applications in 
fiscal year 1997. NCS must have both human and material 
resources to accommodate this increase.
    The Committee commends the President's 1998 budget proposal 
for a $7.3 million increase in operating funds for the cemetery 
system. Also included are funds for 52 additional FTEE to 
accommodate increased workloads throughout the system as well 
as staffing for a new cemetery in Tahoma, Washington, and 
partial staffing for new cemeteries being constructed near 
Chicago, Illinois; Dallas, Texas; and Albany, New York. The 
Committee expects to see similar increases in the NCS budget 
for the next several years to accommodate the new cemetery 
activations.
    The NCS's workload per FTEE continues to grow. Nationally, 
the number of interments is projected to increase to a record 
76,875 in fiscal year 1998. Similarly, the number of gravesites 
maintained is estimated to reach 2.2 million in fiscal year 
1998. If increases in workload are not matched by FTEE 
increases, NCS will continue to lose ground relative to overall 
system maintenance. This results in a deterioration in the 
appearance and overall condition of the entire system and 
allows what may be minor maintenance items to become major 
repair projects. While FTEE levels have essentially kept pace 
with workload increases since 1994, funding shortfalls for 
previous years have created a catch-up situation.
    The Committee strongly supports the President's request, 
especially the additional 52 FTEE to ensure that staffing and 
equipment keep up with workload. The National Cemetery System 
must maintain its facilities as befitting their status as 
national shrines to veterans.

                           Operating Account

    The Committee is pleased that VA is proposing to increase 
funding by nearly $1.4 million for maintenance and repair, 
grounds maintenance and related supplies. These funds are vital 
to preserving the appearance of cemetery grounds.
    The National Cemetery System maintains approximately 400 
buildings and 100 miles of roads. To help with that 
maintenance, VA has an inventory of more than 8,000 pieces of 
equipment with an estimated value of $23 million. Through an 
extensive maintenance program, this equipment's longevity has 
been extended an average of five years beyond its scheduled 
replacement date. In many instances, however, it is no longer 
economical to maintain the equipment. The budget proposes to 
reduce this backlog in obsolete equipment to $6.3 million.

                         Cemetery Construction

    The VA's construction needs for new and existing cemeteries 
are addressed through Major and Minor Construction 
appropriations. NCS has focused construction planning on 
providing new cemeteries in areas of the country with the 
greatest unserved veteran population, extending the life of 
existing cemeteries through gravesite development, and 
repairing and maintaining the infrastructure of the system.
    For fiscal year 1998, the President's budget proposes $30.9 
million for major cemetery construction, including: $12.6 
million for a new cemetery at Cleveland, Ohio; $9.4 million for 
expansion of the cemetery at Ft. Sam Houston, Texas; and $9.1 
million for gravesite development at the National Memorial 
Cemetery of Arizona. The Committee supports these proposals and 
notes that activation of these cemeteries in future years will 
require significant increases in NCS personnel.
    Minor construction projects, which are those costing less 
than $3 million, total $16 million for fiscal year 1998, and 
the Committee supports that request.

                     State Cemetery Grants Program

    The State Cemetery Grants Program makes grants available to 
assist the states in establishing, expanding, and improving 
state-owned veterans cemeteries. The State Cemetery Program is 
funded at $1 million for fiscal year 1997. Since its 
establishment in 1980, $48.3 million has been obligated through 
fiscal year 1996. Nearly 100 grants have been awarded to 18 
states and Guam since the program's inception.
    The Department is proposing to change the funding formula 
for grants to construct state veterans cemeteries and to 
increase funding to $10 million for fiscal year 1998. Under the 
current formula, VA pays 50 percent of the cost to construct a 
state cemetery. VA is proposing to increase the Federal share 
to 100 percent of construction plus 100 percent of initial 
equipment costs. VA believes that this will encourage more 
states to participate in the grant program.
    The Committee continues to support the state grant program 
as a means to increase burial space for veterans.

                     U.S. Court of Veterans Appeals

    The Veterans' Judicial Review Act, Public Law 100-687, 
established the U.S. Court of Veterans Appeals as an executive 
branch court. The Court is empowered to review decisions of the 
Board of Veterans' Appeals and may affirm, vacate, reverse or 
remand such decisions as appropriate. The Court has the 
authority to decide all relevant questions of law, to interpret 
constitutional, statutory, and regulatory provisions, and to 
determine the meaning or applicability of the terms of an 
action by the Secretary of Veterans Affairs. The Court also has 
the authority to compel actions of the Secretary that are found 
to have been unlawfully withheld or unreasonably delayed.
    The Committee supports the Court's budget request of $9.4 
million.

                          Department of Labor

               VETERANS' EMPLOYMENT AND TRAINING SERVICE

    Congress has determined that our nation has a 
responsibility to meet the employment and training needs of 
veterans. To meet those needs, the Secretary of Labor is 
required to effectively and vigorously implement policies and 
programs which increase opportunities for veterans to obtain 
employment, job training, counseling and job placement 
services. Such implementation is accomplished through the 
Assistant Secretary of Labor for Veterans' Employment and 
Training (ASVET). The ASVET is the principal advisor to the 
Secretary of Labor with respect to the formulation and 
implementation of all departmental policies and procedures 
which affect veterans.

                  Disabled Veterans' Outreach Program

    The Disabled Veterans' Outreach Program (DVOP) was 
established by Congress to provide intensive employment and 
training services to service-connected disabled veterans and 
other veterans in need of job search and placement assistance. 
DVOPs serve as workshop facilitators for the Transition 
Assistance Program (TAP), a 3-day program that provides 
transition counseling, job-search training and information, 
placement assistance and other information and services to 
servicemembers who are within 180 days of separation from 
active duty. DVOPs also develop job and job-training 
opportunities for veterans through contacts with employers. 
Additionally, DVOPs provide assistance to community-based 
organizations and grantees who provide services to veterans 
under other federal and federally-funded employment and 
training programs, such as the Job Training Partnership Act and 
the Stewart McKinney Act.
    Under section 4103A, title 38, United States Code, the 
Secretary of Labor is required to annually make available for 
use in each state sufficient funds to support the appointment 
of one DVOP specialist per 6,900 veterans residing in the state 
who are veterans of the Vietnam era, veterans who entered 
active duty as a member of the armed forces after May 7, 1975, 
or service-disabled veterans. This formula provides an 
indicator of anticipated workload and the number of DVOPs 
required to provide an acceptable level of service to veterans 
seeking employment assistance. DVOPs are located in employment 
service offices and outstation sites such as Department of 
Veterans Affairs regional offices and Vet Centers. The 
Committee supports full funding at the statutorily-mandated 
level of $104.7 million. Full funding will result in an 
estimated 44,000 additional job placements for veterans.

               Local Veterans' Employment Representatives

    The Local Veterans' Employment Representative (LVER) 
program was established to functionally supervise the provision 
of job counseling, testing, job development, referral and 
placement to veterans in local employment services offices. 
LVERs participate in TAP workshops and maintain regular contact 
with community leaders, employers, labor unions, training 
programs and veterans service organizations in order to keep 
them advised of eligible veterans available for employment and 
training. LVERs also provide labor exchange information to 
veterans and promote and monitor participation of veterans in 
federally funded employment and training programs. Finally, 
LVERs monitor the listing of jobs by federal contractors and 
subsequent referrals of qualified veterans to these employment 
openings, refer eligible veterans to training, supportive 
services, and educational opportunities, and assist, through 
automated data processing, in securing and maintaining current 
information regarding available employment and training 
opportunities.
    Section 4104(a)(1), title 38, United States Code, mandates 
that the Secretary of Labor make available funding to support 
the appointment of at least 1,600 full-time LVERs and the 
states' administrative expenses associated with the appointment 
of that number of LVERs. The Committee supports full funding at 
the statutorily-mandated level of $86.5 million.
    VETS also manages the Homeless Veterans Reintegration 
Program (HVRP). The program is designed to provide support 
services to local agencies targeting homeless veterans with 
employment assistance. For the past two years, the President 
and the Appropriations Committee have failed to support funding 
for the program, while the law creating this program authorizes 
$10 million per year. This year the President has proposed $2.5 
million for HVRP. The Committee recommends funding HVRP at $7.5 
million to increase services to homeless veterans.
    The Committee feels strongly that the recommended funding 
for HVRP if not otherwise provided should come from the 
McKinney Act, (Stewart B. McKinney Homeless Assistance Act, 
Public Law 100-77). Public Law 103-446 expressed the sense of 
Congress that programs for homeless veterans should receive a 
fair share of funding from any federal agency or program 
targeting the homeless. Currently, homeless veterans are 
estimated to comprise one third of the homeless adult 
population, with nearly 250,000 veterans living in the streets. 
The McKinney Act is a major source of homeless funds and 
programs for homeless veterans should receive a fair portion of 
those funds and not be forced to rely on funds intended for 
veterans medical care or employment programs.

                  National Veterans Training Institute

    The National Veterans Training Institute (NVTI) is operated 
under contract by the University of Colorado at Denver and 
provides basic and advanced instruction in veterans employment 
programs and services. Because this is the only source of 
formal training for federal and state employees for veterans 
employment programs, NVTI is vital to the success of those 
programs. The President has recommended $2.0 million for fiscal 
year 1998 and the Committee fully supports that request.

                          Proposed Legislation

    Cost of Living Adjustment (COLA).--The Committee supports a 
cost-of-living adjustment (COLA) for compensation and 
Dependency and Indemnity Compensation, and education recipients 
based on the COLA calculation for Social Security recipients.

                           Montgomery GI Bill

    The Committee notes that the President's budget contains 
education initiatives estimated to cost over $50 billion but 
did not recommend additional funds to increase the benefit 
level in any education program operated by the Department of 
Veterans Affairs. The Committee also notes that inflation in 
the cost of education has averaged over 7 percent per year 
since the inception of the Montgomery GI Bill. Today, a veteran 
who has earned an education benefit through two years of 
military service receives $347 per month from the Montgomery GI 
Bill, but the average annual cost is $9,750 for tuition, room 
and board, fees, books and transportation at a public 
institution. For private schools, the annual cost is now 
$20,750. Today, the Montgomery GI Bill falls short by $6,600 
annually for a public school and $17,600 for a private school. 
Therefore, the Committee recommends that the Budget Committee 
include improvements to the Montgomery GI Bill and other 
education programs provided in return for military service as a 
significant part of any education initiatives supported in 
fiscal year 1998.

                           Savings Provisions

    The President's budget proposes several savings provisions. 
These include a permanent round down of compensation COLAs for 
all beneficiaries, limiting monthly pension benefits to $90 for 
Medicaid-eligible beneficiaries in nursing homes, the authority 
to match income records with the IRS and SSA for pension 
beneficiaries, imposition of a .75 percent surcharge on VA home 
loans, continuing VA's authority to use the higher ``no bid'' 
rate in housing loan programs, and continuing the 3 percent fee 
for multiple uses of VA home loans made with less than 5 
percent down payment. The President's budget proposes to make 
permanent several recent budget provisions of current law which 
were enacted in prior budget reconciliation acts, and which are 
schedule to expire at the end of 1998. The Committee has not 
supported making savings provisions permanent in the past and 
recommends that the Budget Committee reject that proposal.
    The budget also proposes new legislative initiatives that 
would repeal restrictions on the collection of loan guaranty 
debts, permanently extend loan asset sales enhancement 
authority, and increase the funding fee for vendee loans to 
2.25 percent.
    Projected first year savings for these provisions total 
$46.36 million and $3.44 billion over five years.
 REPORT TO THE COMMITTEE ON THE BUDGET FROM THE COMMITTEE ON VETERANS' 
AFFAIRS ON THE BUDGET PROPOSED FOR FISCAL YEAR 1999, SUBMITTED ON MARCH 
                                24, 1998

             Summary Table: Estimates of Committee on Veterans' Affairs For Fiscal Year 1999 Budget2
                                      (Net Budget Authortiy--$ in millions)
----------------------------------------------------------------------------------------------------------------
                                                                            FY 1999         FY 1999
      Department of Veterans Affairs           FY 1997       FY 1998    Administration     Committee    Comm. +/-
                                                                            Request     Recommendation    Admin.
----------------------------------------------------------------------------------------------------------------
Veterans Benefits Administration:
  Compensation and Pension................       19,599        20,483         21,857          21,857          0
  Proposed Legislation....................  ............  ............  ..............             0          0
  COLA....................................  ............  ............           287             287          0
  Tobacco.................................  ............  ............         -\400           -\400          0
  Readjustment Benefits...................        1,377         1,366          1,175           1,175          0
  Proposed Legislation....................  ............            0            291             400        109
  Housing Programs........................          657         1,036            423             423          0
  Proposed Legislation....................            0             0            -\2               0          2
  All Others..............................           40            52             47              47          0
                                           ---------------------------------------------------------------------
Subtotal, Veterans Benefits...............       21,673        22,937         23,678          23,789        111
 
Veterans Health Administration:
  Medical Care Appropriation..............       17,012        17,057         17,028          17,509        481
  Medical Care Collection Fund............            0           688            677             559      -\118
  Proposed Legislation....................            0             0             87               0       -\87
                                           ---------------------------------------------------------------------
Subtotal..................................       17,012        17,745         17,792          18,068        276
 
  Medical and Prosthetic Research.........          262           272            300             300          0
  MAMOE...................................           61            60             60              62          2
  State Homes and Parking.................           60            80             37              80         43
                                           ---------------------------------------------------------------------
Subtotal, Veterans Health.................       17,395        18,157         18,189          18,510        321
 
Departmental Administration:
  Construction, Major Projects............          219           209             97             237        140
  Construction, Minor Projects............          175           175            141             175         34
                                           ---------------------------------------------------------------------
Subtotal Construction.....................          394           384            238             412        174
 
  VBA.....................................          626           596            651             672         21
  General Administration..................          202           191            199             200          1
                                           ---------------------------------------------------------------------
Subtotal GOE..............................          828           787            850             872         22
 
  National Cemetery System................           77            84             92              93          1
  Office of Inspector General.............           31            31             33              36          3
  Grants for State Cemeteries.............            1            10             10              10          0
                                           ---------------------------------------------------------------------
Subtotal, Department Administration.......        1,331         1,296          1,223           1,423        200
                                           =====================================================================
 
Total, DVA adjusted.......................       40,398        42,390         43,090          43,722        632
  Trust funds, net........................        1,067         1,025            968             968          0
  Proprietary receipts, adjustments, and        -\1,667         -\675          -\685           -\685    ........
   intragovernmental transactions.........
                                           =====================================================================
 
Total, Department of Veterans Affairs.....       39,798        42,740         43,373          44,005        632
----------------------------------------------------------------------------------------------------------------

                              Introduction

                        The Veterans Population

    Between 1997 and the year 2010, the number of living 
veterans is projected to decline from 25.4 million to 20 
million, a decline of 21 percent. The largest group of living 
veterans by period of service is the Vietnam era population of 
8.2 million veterans, followed by the World War II group of 6.7 
million veterans. The number of veterans 65 years and over is 
expected to peak in the year 2000 at 9.3 million. The number of 
veteran deaths will increase each year until a peak of 620,000 
deaths is reached in 2008.

 
----------------------------------------------------------------------------------------------------------------
                            Projected Number of Participants in VA Programs, FY 1999
-----------------------------------------------------------------------------------------------------------------
                    Program                      Participants                Program               Participants
----------------------------------------------------------------------------------------------------------------
Medical Care:                                                   Vocational Rehabilitation:
  Unique Patients.............................      3,413,000     Veterans Receiving Services...         52,200
Compensation:                                                   Loan Guaranty:
  Veterans....................................      2,361,900     Loans Guaranteed..............        222,000
  Survivors/Children..........................        307,400   Insurance:
Pension:                                                          Administered Policies.........      2,275,800
  Veterans....................................        390,100     Supervised Policies...........      2,465,000
  Survivors...................................        283,000   National Cemetery System:
Education:                                                        Interments....................         80,300
  Veterans and Servicepersons.................        309,900     Graves Maintained.............      2,322,400
  Reservists..................................         76,400     Headstones and Markers........        336,500
  Survivors/Dependents........................         43,000
----------------------------------------------------------------------------------------------------------------

                         Spending for Veterans

    In 1950, the veteran population was just over 19 million 
and Federal spending for veterans benefits and services 
comprised almost 21 percent of the total Federal budget and was 
equal to 3.24 percent of the gross domestic product (GDP). In 
that same year, veterans benefits made up more than 62 percent 
of the category of spending known as ``human resources'', e.g. 
spending for education, health, and social security. By 1965, 
spending for veterans benefits had declined to less than one 
per cent of GDP, and it has been around one half of one percent 
since at least 1985.
    In the most recently completed fiscal year (1997), spending 
for veterans benefits and services had shrunk to 2.5 percent of 
total Federal spending, and equaled one-half of one percent 
(0.5 percent) of GDP. Veterans benefits comprised only 3.9 
percent of Federal spending for human resources in the same 
year. Outlays for mandatory veterans benefits (mainly 
compensation, pension and education benefits) are projected to 
fall from 13.4 percent of all federal mandatory outlays in 1965 
to 2.8 percent of such outlays in 1999.
    Comparing spending for veterans' health care needs reveals 
a similar picture. In 1965, the year in which Medicaid and 
Medicare were created, spending for veterans health equaled 
roughly 40 percent of total Federal health spending. A decade 
later, spending for veterans health was less than 10 percent of 
spending on Medicaid and Medicare. In 1997, the $17.1 billion 
spent for veterans health was 5.4 percent of Federal spending 
on Medicare and other health programs, and this percentage will 
continue to decline if present fiscal trends continue.
    The Administration's 1999 budget assumes that the federal 
government will receive approximately $65.5 billion from 
tobacco companies in connection with pending legislation to 
approve a tentative settlement agreement between various state 
attorneys general and major tobacco companies. Given the 
billions of dollars expended each year by the VA to provide 
health care and other benefits to veterans suffering from 
tobacco-related illnesses, it is the Committee's view that the 
VA and the veterans it serves should receive significant 
proceeds from any such settlement. The Committee is 
disappointed that the Administration's budget fails to directly 
provide any settlement proceeds for the VA, and intends to take 
necessary action to ensure that VA receives funds from any 
tobacco settlement that is approved by the Congress.

                      PROJECTED SPENDING FOR VETERANS BENEFITS AND SERVICES (FUNCTION 700)
                                    (Budget Authority in billions of dollars)
----------------------------------------------------------------------------------------------------------------
                                                  1998     1999     2000     2001     2002     2003    1998-2002
----------------------------------------------------------------------------------------------------------------
Mandatory.....................................     23.8     23.9     24.8     25.6     26.2     27.6       151.9
Discretionary.................................     19.0     18.9     18.9     18.9     18.9     19.6       114.2
                                               -----------------------------------------------------------------
  Total.......................................     42.8     42.8     43.7     44.5     45.1     47.2       266.1
                                               =================================================================
----------------------------------------------------------------------------------------------------------------

      Effects of the Balanced Budget Act on Spending for Veterans

    The table above shows the projected spending levels for 
veterans benefits and services under the budget agreement 
reached in 1997. The totals shown for discretionary spending do 
not include amounts which VA would be authorized to spend for 
medical care as a result of keeping receipts which were 
previously deposited in the Treasury. CBO estimates these 
receipts will range from $542 million in 1998 to $615 million 
in 2002. Since spending will equal the amount collected, a 
bookkeeping convention excludes these amounts from the total 
shown for discretionary spending.
    Under the budget agreement, discretionary spending for 
veterans benefits and services is projected to remain almost 
constant at the 1998 level of $19 billion. Mandatory spending 
is projected to rise slightly over the next five years, from 
$24 billion in 1998 to $26.5 billion in 2002, an increase of 
about 2 percent a year over this period. Overall spending for 
veterans benefits and services would rise from $43.1 billion to 
$45.4 billion, an annual rate of increase just over one percent 
(compared with a projected 2.3 percent annual increase in 
overall Federal spending for the same period).

                Background and Committee Recommendations

                     Department of Veterans Affairs

                     veterans health administration

Medical Care

    ``Change'' and ``transition'' continue to characterize the 
state of the VA health care system. At all levels, the Veterans 
Health Administration has undergone major reorganization. 
Statutory changes and new policies continue to be implemented, 
primarily through VHA's 22 network offices, which to varying 
degrees have exercised decentralized authority to make their 
mark on the provision of care in their respective geographic 
service areas. Among the changes still underway are:

    
   Lreductions in the number of acute care beds 
(down 40 percent or some 21,000 beds since September 1994) and 
a decline in annual inpatient admissions of some 250,000/year;

    
   Lan accompanying increase of 7.3 million 
ambulatory care visits in the last three years;

    
   Lfurther reallocation of medical care funds from 
networks of facilities serving a shrinking patient base to 
those whose funding had not kept pace with veteran population 
growth;

    
   Lredirecting resources--from merging hospitals, 
closing hospital wards, and other efforts at improving 
productivity--to establish new community-based outpatient 
clinics (some 150 have been established);

    
   Limplementation of new health-care eligibility 
rules, which will require enrollment of most veterans as a 
condition of their receiving care;

    
   Ldevelopment of a national formulary for 
pharmaceuticals and other efforts to achieve economies of scale 
to increase VA purchasing power;

    
   Lefforts to increase reliance on non-
appropriated funding sources.

    With greater efficiencies at VA facilities and accompanying 
changes in practice patterns, more emphasis has been placed on 
providing veterans have gained increased access to primary 
care. These ongoing changes also pose a large challenge for VA 
managers at all levels to assure that VA effectively employs 
its resources--budgetary and otherwise--to meet the needs and 
expectations of a complex patient population.
    As the Department wrestles with the complex management 
challenges associated with major system changes, VA must also 
grapple with a difficult fiscal challenge. No longer is the 
VA's congressionally appropriated medical care budget the sole 
source of needed revenue to support the health care system. 
With the establishment of authority for VA to retain 
collections and fees in the new Medical Care Collections Fund 
and use those funds to supplement medical care appropriations, 
Congress has given VA a powerful new incentive to maximize 
collections. It has been clear, however, that the primary 
source of those supplementary funds are third-party 
collections, primarily from health-care insurers.
    The fiscal year 1999 budget is dependent both on the 
Department's increasing substantially the revenues generated 
through its recovery efforts and on its ability to function 
effectively with medical care appropriations which not only do 
not increase, but would be $29 million below the 1998 
appropriation level. Consistent with the budget agreement 
approved by Congress last year, the Administration, in effect, 
asks Congress to make two huge leaps of faith in advancing this 
budget for VA medical care. First, it asks Congress to believe 
that VA will increase its medical care collections more than 
$100 million above the 1998 level, a level which the 
Congressional Budget Office projects will increase only 
slightly in 1999. Even more significantly, it urges Congress to 
concur in the blind faith that VA can wring more than $680 
million in savings out of its medical care system--by absorbing 
fixed cost increases and the impact of inflation--without any 
adverse effect on its medical care to veterans. Those savings 
would come on top of savings squeezed from the same system in 
the prior fiscal year.
    As described above, the VA has made dramatic changes in its 
health care delivery system. Many of the changes have been 
positive. Facilities in close proximity have merged. 
Redundancies and unneeded positions have been eliminated. 
Underutilized hospital wards have been closed, reliance on 
outpatient care has been expanded. In the aggregate, indicators 
of quality have improved.
    But budget-driven cuts have not been without impact on VA's 
patients. Pressures to reduce costs have resulted in:

    
   Lmedical centers cutting valued staff in needed 
programs including blind rehabilitation, prosthetics, spinal 
cord injury care and similar special programs which Congress in 
Public Law 104-262 explicitly required VA to protect;

    
   Lmedical centers closing needed but costly-to-
operate VA nursing home beds or placing restrictions on the 
number of nursing home bed days veterans can receive;

    
   Lmedical centers cutting home-health and other 
services to veterans; and

    
   Linstances of VA practitioners being required to 
cease using expensive medications and to limit the time spent 
with any patient to a matter of minutes.

    While such situations are not occurring at every VA 
facility, they are neither isolated events nor matters of 
hearsay. With VA facilities under unyielding pressure both to 
cut costs and to increase the numbers of veterans served, it is 
apparent that the changes underway are not wholly ``seamless'' 
or painless to patients who require more than primary care 
services. In a system which has decentralized authority to 22 
network offices and has eliminated the requirements and much of 
the means for national oversight, VA headquarters itself no 
longer knows where individual patients are falling through the 
cracks created by budget pressures. This Committee finds 
increasing evidence, however, that some facilities have already 
squeezed out what savings can reasonably be achieved and cannot 
keep doing more with less spending power--except at the expense 
of the care provided to veterans. With growing signs that the 
system cannot sustain ``no growth'' budgets without endangering 
needed programs and compromising care or access to needed 
services, this Committee rejects the Administration's 
overconfident view that veterans can rely on ``anticipated 
management efficiencies'' to offset in their entirety increased 
costs of such magnitude.
    In addition to that concern, the Administration budget 
projects that gross fiscal year 1999 collections will total 
$677 million, a hefty increase over a current estimate for FY 
1998 of $598 million. Such efforts at estimating have proven 
unreliable in the past; in fiscal year 1997, VA collections 
fell almost $200 million below projection targets. VA officials 
have acknowledged that there is no reliable methodology on 
which to base collections' projections, and no assurance that 
future projections can be achieved.
    Under the Administration's budget, the availability of 
needed health care dollars are not simply dependent on VA 
employees' response to collections' incentives; factors 
completely beyond VA's control absolutely limit recovery 
potential. In a recent report to this Committee, the General 
Accounting Office cited a number of these factors as evidencing 
the likelihood that recoveries from private health insurance 
will actually decline. They include:

    
   Lthe shift in care from inpatient to outpatient 
settings;

    
   Lincreased enrollment in managed-care health-
insurance plans;

    
   Lchanges in how insurers process VA claims; and

    
   Lthe aging and decline of the veteran 
population.

    The Committee notes that, in contrast to the heady 
projections in the Administration's budget, the Congressional 
Budget Office baseline projects medical care collections of 
only $559 million for fiscal year 1999. In effect, this 
Administration asks the Congress to join its wager that VA will 
exceed the CBO collections' estimate by $118 million. It is 
particularly troubling that this wager accompanies an 
Administration budget request for medical care appropriations 
which, as discussed above, seeks no funds for uncontrollable 
increases in program costs, such as rent costs and mandatory 
salary increases, (totaling $419 million) and inflation ($262 
million) and blithely looks to unidentified ``management 
efficiencies'' as a source for absorbing these costs. With such 
a dangerous balancing act ahead, Congress can ill afford to bet 
on OMB's collections' targets and risk a more than $100 million 
error.

    Proposed legislation.--The Administration's FY 99 budget 
extends a wholly unprecedented offer to Congress. As proposed 
in the budget, if the Congress enacts legislation to authorize 
a ``new smoking cessation program for any honorably discharged 
veteran who began smoking in the military . . . the 
Administration will submit a budget amendment requesting an 
appropriation of $87 million for this new activity.'' It is 
apparent to the Committee that the Department of Veterans 
Affairs did not initiate this request, and would be hard 
pressed to defend it as a priority.
    The ``smoking cessation'' proposal is ill conceived. It 
ignores the existence of authority under current law to provide 
such services--as part of the care furnished veterans who 
enroll as VA patients. It proposes to spend substantial monies 
on a new benefit which, in practice, would have to be made 
available to any honorably discharged veteran. The proposal 
would draw a distinction, without explanation, between the 
honorably discharged veteran and veterans with general 
discharges or other than dishonorable discharges, but would be 
open to veterans regardless of income. While making large 
numbers of veterans eligible for a limited, new benefit, the 
proposal is logically flawed in providing no other services for 
veterans who have or are presumed to be at risk for smoking-
related illnesses. With VA only beginning to implement a 1996 
law reforming the patchwork of law which had previously 
governed eligibility for VA health care, this proposal would 
reinstate the confusion inherent in a veteran being provided a 
service related to smoking but denied other smoking-related 
care or preventive services.

    Unmet long-term care need.--While the Administration's 
budget proposes a new ``medical'' benefit for veterans, it does 
little to assure needed availability of care for those both 
eligible for, and dependent on, VA care. Specifically, this 
budget does little to narrow the gap between the needs of the 
aging veteran population and VA's capacity to meet their long-
term care needs. While VA has extended its capacity to provide 
relatively low-cost primary care services to its patients, it 
has no comparable record of achievement in meeting long-term 
care needs--particularly in provision of services aimed at 
avoiding institutionalization. To the contrary, VA's Advisory 
Committee on the Future of Long-Term Care, in its deliberations 
over the past months, has identified VA's level of commitment 
to noninstitutional community-based long term care programs as 
in need of a dramatic infusion of funds.
    Currently, only approximately seven percent of VA long-term 
care funding is devoted to noninstitutional long-term care 
programming, with almost 93 percent of funds devoted to 
provision of nursing home care. The small percentage dedicated 
to keeping patients in their homes and communities masks the 
reality that there is tremendous variability in expenditures 
from network to network. Thus, while a number of networks 
allocate some 10 percent of their long-term care budgets to 
community-based non-institutional care, several dedicate only 
half that much. Given a need for such services among the large 
numbers of VA's elderly chronically ill patients, it is 
apparent that VA has much catching up to do. The Advisory 
Committee, for example, discussed a proposal to triple VA 
funding for these programs. VA would need to boost spending by 
some $250 million to meet that target. The Committee believes 
that the $87 million proposed for smoking cessation programs 
would be better spent if those monies were allocated instead as 
a first step toward meeting aging and chronically ill veterans' 
widespread need for non-institutional services. Such added 
funding alone would provide no new services, however, if VA 
collections fall significantly below the budget estimates.
    In testimony before this Committee, VA has also recognized 
a need to provide case-management services for veterans with 
complex health problems. Case management services are needed by 
a range of VA's patients, from the elderly, chronically ill 
veteran to Persian Gulf veterans with complex undiagnosed 
illnesses. This budget, however, is not only silent as to 
dedicating staff to address this need, it actually proposes a 
reduction in VA's health care workforce by 2,600 FTEE. With a 
staffing reduction projected to occur at the same time as a 
planned increase in patients treated, there is little basis to 
believe that medical centers will have sufficient incentive or 
capacity to establish new case-manager positions. Yet such 
positions are needed to ensure that veterans in greatest need 
do not ``fall through the cracks''.
    VA's resource allocation system (VERA) does provide its 
networks with higher per patient funding for special care 
patients, those suffering from such chronic conditions as 
schizophrenia and dementia, spinal cord injury, and AIDS, who 
are necessarily high intensity users of medical care. The 
General Accounting Office's audit of VA's implementation of 
VERA makes apparent, however, that there is no system or 
uniformity associated with the distribution of those funds by 
VA's networks to their VA medical centers. Such variability may 
be attributable to the competing pressures for funds within the 
networks. For example, networks are required to absorb the 
often high recurring and nonrecurring costs of construction 
activations. Moreover, there is no requirement on the networks 
that such special care funding support in full the needs of 
special care patients, and no evidence that they have been so 
used. In fact, recent testimony before this Committee suggests 
that they are not. Accordingly, the Committee is concerned that 
the closure of many inpatient programs and anticipated further 
reduction in employment levels will leave many networks without 
the capacity to support adequately the growing number of 
deinstitutionalized chronically mentally ill veterans and other 
chronically ill veterans with little or no community support 
mechanisms.
    The Committee believes it is important and prudent in the 
face of further anticipated deinstitutionalization, that new 
monies and accompanying FTEE be targeted to ensure intense 
case-management programs for the most complex cases. The 
Committee believes this investment could ultimately avoid the 
need to reinstitutionalize patients. VA reports that it 
provides care to more than 146 thousand ``special care'' 
patients. Dedicating 980 FTEE to case management support could 
ensure closely supervised, coordinated care for some 10 percent 
of the most complex of cases within the special care 
population.
    Accordingly, the Committee recommends an increase above the 
amount recommended by the Administration for appropriation to 
the medical care account of $481 million, encompassing the 
following:

    
   Lthe addition of $118 million to cover the 
difference between CBO's projection of medical care collections 
in FY 1999 and VA's collections' target;

    
   L$200 million to cover that part of the 
projected $681 million health-care cost increases and inflation 
which cannot reasonably be absorbed by ``management 
efficiencies'' without putting valued veterans' programs and 
services at risk;

    
   La reduction of the $87 million proposed for a 
smoking cessation program, and the addition of $95 million to 
expand community-based non-institutional long term care 
services; and

    
   L$68 million to establish case-management 
programs at VA medical centers and large clinics.

    Such an increase in the medical care appropriation would 
reduce the very large risks facing veterans who depend on the 
VA health care system while enabling the Department to begin to 
expand much needed programs to care for the most vulnerable of 
VA's patients.

Medical Research

    The $300 million fiscal year 1999 budget for medical and 
prosthetic research for the first time in many years recognizes 
the real value of this program, and the dangers in reducing 
VA's research efforts. The Department has designed well-
developed strategies and performance goals for its research 
program which provide confidence that a historically strong 
effort will be both focused and provide maximum benefit. The 
Committee is pleased that in proposing a substantial increase 
over the fiscal year 1998 appropriation, this budget would 
allow for new initiatives in areas with particular relevance to 
veterans.

Major Medical Construction

    As the VA health care system undergoes a significant 
transformation from providing care primarily in hospital wards 
to offering more outpatient services in an expanding number of 
both facility-based and community-based outpatient clinics, 
Congress expects VA to continue to rely on its expansive 
hospital-based infrastructure as a foundation for its clinical, 
education and research activities. Much of that infrastructure 
is decades old, and in many cases fails to meet patient care, 
safety, and privacy needs.
    In recent years, constrained major construction budgets 
have resulted in fierce competition for scarce funding among 
projects with demonstrable compelling needs. As limited budgets 
have delayed approval of long pending initiatives, projects 
have undergone repeated scrutiny and reassessment. It is clear 
that VA's highest priority projects are well justified and are 
limited to addressing the most serious needs--to improve 
ambulatory care capacity, to remedy seismic problems, and to 
meet current patient care standards and requirements. It is 
troubling, that, with the backlog of worthy proposals, the 
Administration budget would fund only two major medical 
construction projects. While the Committee recognizes the need 
for these two projects, it finds very troubling this budget's 
failure to request funds for what the Department itself has 
identified as its three highest priority projects, ambulatory 
care additions to medical centers serving major metropolitan 
areas. The three projects, in Cleveland, Tucson, and 
Washington, D.C., would provide needed space for ambulatory 
treatment now furnished in buildings constructed for much 
smaller outpatient workloads 40 or more years ago. Similarly, 
the budget would not fund two other highly ranked projects, one 
at the Palo Alto, California VA Medical Center which Congress 
authorized in Public Law 104-262, and the other at the Dallas, 
Texas VA Medical Center.
    Mindful of competing budget pressures, the Committee 
recommends a funding level of $237 million, a $140 million 
increase above the Administration's proposal.
    While the Administration's budget clearly does not assign a 
priority to major medical construction, it is perplexing that 
greater priority is not given to either the minor construction 
program or to funding which supports the State home 
construction program.

Minor Construction

    The minor construction account, funding initiatives of $4 
million or less, supports a wide range of needs. Operating in 
facilities which are often many decades old, VA requires the 
flexibility provided by this account to correct safety 
deficiencies; replace utility, heating and cooling systems; 
meet patient privacy standards, including those dictated by the 
increasing number of women patients; renovate space for 
provision of ambulatory care; correct seismic deficiencies; 
clean-up environmental contamination and remove asbestos; and 
address other needs. Given growing, rather than diminishing, 
needs in the Department's huge infrastructure, it is difficult 
to understand a proposed cut of $34 million in this account. 
Extensive systemwide needs and the absence of any rationale for 
the proposed reduction, compel the Committee to recommend 
restoration of those monies and full funding at the current 
fiscal year level of $175 million.

State Home Construction

    This program provides funding for up to 65 percent of the 
cost of construction or needed renovation to help assure that 
States can assist in meeting veterans' needs for nursing home 
and other long term care. The states have been reliable 
partners in this effort, and many have appropriated monies in 
advance to establish priority for grant funding in accordance 
with the governing statutory priority system. At this time, 
many states have already appropriated their share of 
construction costs (to establish priority #1 level ranking) for 
as yet unfunded construction projects, for a total of more than 
$112 million.
    The fiscal year 1999 budget proposal to cut funding for 
this program by $43 million sends a strange signal to the VA' 
state partners. In the face of a large backlog of unfunded 
projects, it is unreasonable to cut funding by more than half. 
Rather than asking states which have put up their share of 
funding in advance to wait for outyear appropriations, the 
budget should reflect a commitment to eliminate the backlog as 
soon as possible. Accordingly, the Committee proposes an 
appropriation of $80 million for fiscal year 1999.

Medical Administration and Miscellaneous Operating Expenses (MAMOE)

    The MAMOE budget funds the headquarters' operations of the 
largest health care system in the country. Congress looks to 
VA's headquarters not simply to set policy, but to achieve 
results. It expects the Under Secretary for Health to manage 
and oversee a system which is marked not only by its size but 
by its increasing complexity. The Under Secretary's 
headquarters staff would shrink by some 16 FTEE under the 
fiscal year 1999 budget. Such a cut would come at a time of 
growing concern about inconsistent management of VA programs.
    VHA's streamlined headquarters staff is adequate in size to 
provide policy guidance within a system which vests network 
directors with broad authority for operations and oversight. It 
has become increasingly apparent, however, that with the 
limited role charted for headquarters, there no longer exists 
adequate oversight, or capacity for oversight, of field 
activities. Quality management represents perhaps the most 
striking example of marked inconsistency throughout the VA 
health care system, and one which requires a far more active, 
vigilant headquarters' role. In a recent report on quality 
management in VHA, the Department Inspector General's Office of 
Healthcare Inspections highlighted this concern:

        ``VHA has many QM policies and processes, which, if 
        applied consistently and effectively, would assure the 
        best possible treatment of VHA patients . . . VHA is 
        challenged with having to ensure the operation of an 
        effective QM program in what may be one of the largest 
        and most complex healthcare systems in existence today 
        . . . [However] VHA's process of devolving management 
        functions to the lowest management level, and the 
        emphasis that has been placed on performance measures . 
        . . has led to a potential inability of top VA managers 
        to know the status of QM implementation in the field. 
        OHI believes that this may have occurred because of a 
        diminution of QM-specific staff at the Headquarters and 
        VISN levels, and because of the remaining employees' 
        need to emphasize performance measurement. By 
        implication, a weakened QM program . . . means that top 
        managers cannot know definitively that VAMC 
        practitioners are maintaining an adequate level of 
        quality in patient care.''

    The Committee shares such concerns, and believes that a 
reduction in staffing would exacerbate the kinds of problems 
the Inspector General has highlighted. Based on these concerns, 
the Committee recommends an additional $2 million for this 
account to restore proposed staffing cuts and provide 
additional staff for quality management oversight.
    The Committee recommends 20 additional staff, for a total 
of 560 employees for the Medical and Miscellaneous Operating 
Expenses account. These additional positions would be assigned 
to system-wide quality assurance programs in the Office of 
Quality and Performance and other appropriate areas reporting 
to the Under Secretary for Health. Such positions should 
monitor and enforce compliance of headquarters' quality-
management directives; coordinate and monitor quality assurance 
activities, including VA's new Patient Safety Improvement 
initiative; and ensure timely access, analysis, and response to 
information collected from VHA's automated databases including 
clinical indicators of quality. New quality assurance employees 
should also be responsible for ensuring appropriate levels of 
credentialed, privileged and board-certified staff at each 
level of the organization.

                    VETERANS BENEFITS ADMINISTRATION

Operation of Benefit Programs

    The General Operating Expenses account funds full time 
employee equivalents (FTEE) and operating expenses for both the 
Veterans Benefits Administration (VBA) and VA's Central Office 
(headquarters). VBA administers a broad range of non-medical 
benefits to veterans, their dependents, and survivors through 
57 regional offices or medical and regional office centers. 
These programs include compensation and pension, education, 
vocational rehabilitation, insurance, and loan guaranty (home 
loans). VBA is also responsible for processing applications for 
these programs. Headquarters includes the Secretary's staff and 
other VA support staff, and is mainly located in Washington, 
DC.
    The Department proposes to reduce overall VBA staffing by 
125 FTEE in fiscal year 1999, largely through reductions in 
information technology and support staff positions. The 
Committee does not support the proposal. This would be a 
decrease of 698 FTEE from the fiscal year 1997 actual 
employment level. The Committee recommends an increase of $15 
million to support an additional 300 FTEE. These additional 
FTEE should be utilized in direct service positions and for 
quality review activities described below.
    The Committee does not support the proposed reduction of 
FTEE because VBA's backlog of claims waiting to be processed is 
again increasing, approaching 400,000 claims. The situation is 
simply this: the funnel into which all the work is being poured 
is too small. The adverse effects of the overflow are a decline 
in the quality of work and employee morale. The Administration 
and Congress must recognize that benefit programs cannot be 
delivered effectively without sufficient well-trained staff.
    To illustrate the Committee's concern about the quality of 
work being affected by FTEE reductions, VA recently completed 
its first Systematic Technical Accuracy Review (STAR). This 
review of a national sample of original compensation claims 
found that 36 percent of the claims contained at least one 
serious error. In that group of claims, errors average over 
four per claim. Clearly, this error rate is substantially 
higher than VA had ever acknowledged and the Committee highly 
commends VBA for its candor and willingness to finally document 
what most stakeholders had been saying for years. The Committee 
strongly believes this type of quality review must continue and 
recommends an additional 10 FTEE and $600,000 to continue this 
vital program.

    Compensation & Pension Service(C&P).--The ability of the VA 
to provide timely and quality benefits delivery is heavily 
dependent on a combination of proper staffing levels, effective 
implementation of computer modernization initiatives, training 
and retention incentives, and inter-departmental cooperation 
between the various VA agencies and military service 
departments. Over the past decade the number of trained 
personnel in the adjudication division has declined by 
approximately 40 percent. The Committee commends the Department 
for reversing this trend with a 140 FTEE increase proposed for 
adjudication services in fiscal year 1999. As mentioned before, 
this increase comes largely from redistribution of resources 
within the C&P service and its related support staff. The net 
gain for the C&P Service following redistribution is seven 
FTEE. With processing time still averaging over 130 days for an 
original compensation claim, and remand rates from the Board of 
Veterans' Appeals (BVA) still approaching 50 percent of the 
Board's decisions, the Committee supports the 140 FTEE increase 
in the C&P Service proposed in fiscal year 1999. The Committee 
also recommends 100 FTEE be added to the C&P Service from the 
300 FTEE in overall VBA employment recommended by the 
Committee.

    Computer Based Training Initiative.--The Committee commends 
the VBA for developing an innovative approach to computer based 
training in a cooperative adult learning environment. The 
initial training module developed for certifying a case to the 
BVA has been completed and will be implemented during the 
current fiscal year. The development of additional training 
modules is expected to reduce the time necessary to train key 
VA decision-makers by at least 50 percent. Given the 
anticipated savings in cost and improved performance by well-
trained employees, the Committee believes that the development 
of additional computer based training materials should be 
accelerated and recommends an additional $6,000,000 for this 
purpose.

    Vocational Rehabilitation and Counseling Program (VR&C).--
The goal of the Vocational Rehabilitation and Counseling 
Program is employment of disabled veterans and certain 
dependents. To accomplish that goal, VR&C is authorized to 
provide all services and assistance necessary to enable 
service-connected disabled veterans to become employable, 
obtain and maintain suitable employment, or to achieve maximum 
independence in daily living. Additionally, VR&C is authorized 
to provide educational and vocational counseling services to 
eligible active duty members, veterans, and dependents. Last 
year, about 9,000 veterans were rehabilitated and VA projects a 
slight decline in program participants from 1997 and 1998 
levels. Vocational rehabilitation specialists currently carry 
an average caseload of about 300 and the small decline in 
overall participation will not measurably affect the average.
    The General Accounting Office has issued three reports 
since 1984 citing significant program management problems, such 
as an inability to identify program costs, high drop-out rates, 
poor case management and an almost blanket use of college 
degree programs for rehabilitation. The Committee expects VR&C 
to pursue a more integrated working relationship with the 
Veterans' Employment and Training Service and implement several 
recent management initiatives until these significant problems 
are overcome. While the Committee is supportive of the budget's 
additional 12 FTEE for the Vocational Rehabilitation and 
Counseling Service, the Committee notes that this is about 26 
FTEE below the 1997 actual employment level for the VR&C 
Service. The VA estimates that an additional 87 FTEE would be 
required to enable VR&C staff to eliminate its backlog of cases 
and provide an adequate level of services.

    Education Service.--VA's Education Service is responsible 
for several programs, most notably the Montgomery GI Bill 
(MGIB), which provides earned education assistance benefits to 
400,000 veterans, active duty, and National Guard and Reserve 
personnel, as well as programs for survivors of veterans who 
are 100 percent disabled, died of a service-connected 
disability or were killed on active duty.
    The Committee rejects the proposed reduction of 25 FTEE for 
the Education Service in the President's fiscal year 1999 
budget. Such reductions will result in a lower level of service 
to veterans because automation and business process 
reengineering initiatives are not yet mature enough to 
sufficiently increase administrative efficiencies.
    The Committee finds it surprising that VA has not 
implemented an electronic method of monthly certification of 
enrollment, which would eliminate nearly all of the, three 
weeks required at a minimum to process monthly education 
benefits. The Committee estimates that postal savings alone 
will pay for the system within two years. The Committee also 
supports the requested $4.5 million for the automation of 
education program management.

                       BOARD OF VETERANS' APPEALS

    The Board of Veterans' Appeals (BVA) has made progress 
toward meeting the production levels needed to reduce the 
backlog of appeals pending. The fiscal year 1996 backlog of 
over 60,000 appeals has now been reduced to under 35,000 as a 
result of additional resources provided over the past two 
years, as well as several management initiatives. In fiscal 
year 1997, the BVA made over 43,000 decisions, an increase of 
10,000 over the previous year. Unfortunately, 42 percent of 
those decisions were remands back to the regional offices, 
another example of the quality problems that continue to plague 
the Regional Offices.
    Clearly, production trends are improving at the BVA and the 
Committee notes that BVA total processing time for all 
categories of claims was reduced from 1,146 days in fiscal year 
1996 to 1,027 days in fiscal year 1997. The Administration has 
requested an additional three FTEE to serve as counsel to the 
Board members and the Committee supports that request. An 
independent consultant retained to study the processes used 
internally by the Department to prepare cases appealed to the 
United States Court of Veterans Appeals has suggested that the 
Board should prepare an appellate record as it reviewed each 
case on appeal. The Committee also notes that there is a 
substantial backlog of cases where veterans have requested 
personal hearings by the Board near their residence. Since 
additional staff are needed to address both of these 
situations, the Committee is recommending an additional $1 
million for the Board's operations in fiscal year 1999.

                           INSPECTOR GENERAL

    Over the past five fiscal years (FY 1993-97), OIG audits 
and inquiries identified cost savings and cost avoidance in 
excess of $1.6 billion. This represents an average rate of 
return of $10 for every $1 spent by the OIG. Despite the 
efficiencies which stem from the work of the OIG, there is a 
significant amount of important work which the Office of 
Inspector General (OIG) cannot accomplish with the resources it 
has available today and under the proposed 1999 budget. Present 
staffing levels are inadequate to meet present department 
needs. Therefore, the Committee recommends an additional $3 
million for increased OIG staffing. The increased OIG funding 
provided in the Committee's budget represents a sound 
investment strategy which will help identify waste, fraud and 
abuse within the VA, and save VA money in the process.

                        NATIONAL CEMETERY SYSTEM

    The National Cemetery System (NCS) administers national 
shrines honoring those who served in uniform and should be 
maintained as places of high honor, dignity and respect. 
Currently, 149 cemeteries and soldiers' lots located in 41 
states, the District of Columbia and Puerto Rico comprise the 
National Cemetery System. Since the first cemeteries for 
American soldiers were established in 1862, approximately 2.4 
million decedents have been interred in national cemeteries and 
approximately 6.4 million headstones and markers have been 
furnished.
    For fiscal year 1999, the Administration is proposing an 
increase of $7.8 million to fund NCS's ever-enlarging 
operations. This includes funds for 21 additional FTEE to 
accommodate increased workloads throughout the system as well 
as staffing for a new cemetery in Tahoma, Washington, and 
start-up staffing for new cemeteries being constructed near 
Chicago, Illinois; Dallas, Texas; and Albany, New York. The 
Committee is in full support of the Administration's request 
for an additional $7.8 million, including 21 FTEE, for the 
National Cemetery System.
    Between fiscal years 1995 and 2010, the veteran population 
will decrease by six million (23 percent). As a result, NCS 
faces an increasing workload because many families of the 
remaining 7.5 million veterans of the World War II generation 
will seek burial in a national cemetery. The NCS's workload per 
FTEE will continue to grow in all areas of operations. For 
example, the total number of gravesites and acreage maintained 
will increase every year. The number of headstones and memorial 
certificates delivered will also increase. In fiscal year 1997, 
the VA interred 73,786 veterans and family members. In fiscal 
year 1999, VA expects to inter 80,300 and by the year 2003, the 
number of interments is projected to increase to 93,600. The VA 
also expects to process 342,000 grave marker applications in 
fiscal year 1999. NCS must have both human and material 
resources to accommodate these increases. Similarly, the number 
of gravesites maintained is estimated to exceed 2.3 million in 
fiscal year 1999.

National Cemetery System Operating Account

    The Committee is pleased that VA is proposing to increase 
funding by $1.5 million for maintenance and repair, grounds 
maintenance and related supplies. These funds are vital to 
preserving the appearance of the cemeteries. The Committee 
recommends an additional $1 million to accelerate the 
improvements of the System's appearance.
    The National Cemetery System maintains approximately 400 
buildings and 100 miles of roads. To help with that 
maintenance, VA has an inventory of more than 8,000 pieces of 
equipment with an estimated value of $23 million, approximately 
$7.2 million of which is past due for replacement.

Cemetery Construction

    The VA's construction needs for new and existing cemeteries 
are addressed through Major and Minor Construction 
appropriations. NCS has focused construction planning on 
providing new cemeteries in areas of the country with the 
greatest unserved veteran population, extending the life of 
existing cemeteries through gravesite development, and 
repairing and maintaining the infrastructure of the system. The 
Committee notes there are no funds requested for additional new 
cemeteries beyond the four scheduled to open through 1999. The 
Committee recommends that of the additional funds recommended 
for VA construction, $500,000 be used for planning efforts to 
identify sites for additional NCS cemeteries.
    The Administration's fiscal year 1999 proposal contains $12 
million in major construction projects for columbaria at the 
Florida and the Ft. Rosecrans, California, National Cemeteries. 
The Committee fully supports those proposals.
    Minor construction projects, which are those costing less 
than $3 million, total $14 million for fiscal year 1999, and 
the Committee supports that request.

State Cemetery Grants Program

    The State Cemetery Grants Program provides grants to assist 
the states in establishing, expanding, and improving state-
owned veterans cemeteries. The State Cemetery Program is funded 
at $10 million for fiscal year 1998. Since its establishment in 
1980, $57.6 million has been obligated through fiscal year 
1997. Nearly 100 grants have been awarded to 25 states, Saipan 
and Guam since the program's inception. The Committee supports 
sufficient funding to accommodate any state seeking to 
participate in the State Grants Program.

Arlington National Cemetery

    Arlington National Cemetery is the nation's premier resting 
place for veterans. The cemetery is currently the final resting 
place for over 250,000 remains. In fiscal year 1999, Arlington 
Cemetery officials estimate they will add about 5,600 remains 
to that total, and conduct 2,700 non-funeral ceremonies.
    The Administration's request is $150,000 below the fiscal 
year 1998 appropriation. The Committee does not support that 
request and recommends an additional $1 million to support 
operations and maintenance at Arlington National Cemetery.

                     U.S. Court of Veterans Appeals

    The Veterans' Judicial Review Act, Public Law 100-687, 
established the U.S. Court of Veterans Appeals as an executive 
branch court. The Court is empowered to review decisions of the 
Board of Veterans' Appeals and may affirm, vacate, reverse or 
remand such decisions as appropriate. The Court has the 
authority to decide all relevant questions of law, to interpret 
constitutional, statutory, and regulatory provisions, and to 
determine the meaning or applicability of the terms of an 
action by the Secretary of Veterans Affairs. The Court also has 
the authority to compel actions of the Secretary that are found 
to have been unlawfully withheld or unreasonably delayed.
    The Committee supports the Court's budget request of $10.2 
million.

                          Department of Labor

               VETERANS' EMPLOYMENT AND TRAINING SERVICE

    Congress has determined that our nation has a 
responsibility to meet the employment and training needs of 
veterans. To accomplish those goals, the Assistant Secretary of 
Labor for Veterans' Employment and Training (ASVET) is 
authorized to implement training and employment programs for 
veterans. The ASVET also acts as the principal advisor to the 
Secretary of Labor with respect to the formulation and 
implementation of all departmental policies and procedures 
which affect veterans.
    The Committee is aware of the significant changes in the 
national labor exchange system. States are changing the way 
they deliver employment services and adopting new service 
delivery models ranging from devolving state programs to the 
county level to privatizing some or all employment functions 
and instituting one-stop employment centers.
    Since the Veterans' Employment and Training Service (VETS) 
and its state-based Disabled Veterans Outreach Program 
Specialist (DVOP) and Local Veterans Employment Representative 
(LVER) system depends upon the state employment services, VETS 
must adopt new strategies to deliver employment services to 
veterans. During the next year, the Committee expects the 
Department of Labor to provide a plan to evolve the veterans' 
employment system to function effectively in the new labor 
exchange marketplace.

Disabled Veterans' Outreach Program

    Under section 4103A, title 38, United States Code, the 
Secretary of Labor is required to annually make available 
sufficient funds for use in each state to support the 
appointment of one DVOP specialist per 6,900 veterans of the 
Vietnam era, veterans who entered active duty as a member of 
the armed forces after May 7, 1975, or service-disabled. For 
fiscal year 1999, this formula results in 2,082 DVOPS. However, 
the Administration's budget provides funds to support only 
1,440 DVOP positions, 641 below the Congressionally-mandated 
level. Accordingly, the Committee recommends that an additional 
$36,065,000, for a total of $116.1 million, be provided for the 
DVOP program. The Committee notes that this full funding level 
will result in an estimated 50,000 additional veterans placed 
in jobs.
    The Disabled Veterans' Outreach Program (DVOP) provides 
intensive employment and training services to service-connected 
disabled veterans and other veterans in need of job search and 
placement assistance. DVOPs serve as workshop facilitators for 
the Transition Assistance Program (TAP), a 3-day program that 
provides transition counseling, job-search training and 
information, placement assistance and other information and 
services to servicemembers who are within 180 days of 
separation from active duty. DVOPs also develop job and job-
training opportunities for veterans through contacts with 
employers. Additionally, DVOPs provide assistance to community-
based organizations and grantees who provide services to 
veterans under other federal and federally-funded employment 
and training programs, such as the Job Training Partnership Act 
and the Stewart McKinney Act.

Local Veterans' Employment Representatives

    Section 4104(a)(1), title 38, United States Code, mandates 
that the Secretary of Labor make available funding to support 
the appointment of at least 1,600 full-time LVERs and the 
states' administrative expenses associated with the appointment 
of that number of LVERs. The Committee supports full funding at 
the statutorily-mandated level of $96.7 million for the 1,600 
positions, an increase of $19,622,000 over the funding level 
proposed in the Administration's budget. VETS estimates that 
the additional 300 LVER positions provided by full funding will 
result in 50,000 more veterans being placed in jobs.
    The Local Veterans' Employment Representative (LVER) 
program was established to functionally supervise the provision 
of job counseling, testing, job development, referral and 
placement to veterans in local employment services offices. 
LVERs participate in TAP workshops and maintain regular contact 
with community leaders, employers, labor unions, training 
programs and veterans service organizations in order to keep 
them advised of eligible veterans available for employment and 
training. LVERs also provide labor exchange information to 
veterans and promote and monitor participation of veterans in 
federally funded employment and training programs. Finally, 
LVERs monitor the listing of jobs by federal contractors and 
subsequent referrals of qualified veterans to these employment 
openings, refer eligible veterans to training, supportive 
services, and educational opportunities, and assist, through 
automated data processing, in securing and maintaining current 
information regarding available employment and training 
opportunities.
    VETS also manages the Homeless Veterans Reintegration 
Program (HVRP). The program is designed to provide support 
services to local agencies targeting homeless veterans with 
employment assistance. For the past two years, the President 
and the Appropriations Committee have failed to support funding 
for the program, while the law creating this program authorizes 
$10 million per year. This year the President has proposed $2.5 
million for HVRP. The Committee recommends funding HVRP at the 
authorized level of $10 million to increase services to 
homeless veterans.

National Veterans Training Institute

    The National Veterans Training Institute (NVTI) is operated 
under contract by the University of Colorado at Denver and 
provides basic and advanced instruction in veterans employment 
programs and services. Because this is the only source of 
formal training for federal and state employees for veterans 
employment programs, NVTI is vital to the success of those 
programs. The President has recommended $2.0 million for fiscal 
year 1999 and the Committee fully supports that request.

                          Proposed Legislation

    Cost of Living Adjustment (COLA).--The Committee supports a 
cost-of-living adjustment (COLA) for compensation and 
Dependency and Indemnity Compensation, and education recipients 
equal to the COLA calculation for Social Security recipients.

 Legislative Items Which the VA Committee May Report with Small Direct 
                         Spending Implications

    Extend expired authority to allow VA medical center 
retention of certain pension benefits payable to veterans who 
are being provided nursing home care at VA expense.--Veterans 
without dependents who are being provided nursing home care by 
the Department and who receive pension benefits have the amount 
of their pension reduced to $90 per month after three calendar 
months of nursing home care. The VA facility providing the 
medical care had the authority to retain amounts of pension 
above $90 which would otherwise be paid to the pensioner and to 
use those funds for operating expenses. This authority expired 
on September 30, 1997. The Committee estimates the first year 
cost of reinstating this authority at $2 million and the five 
year cost at $11 million.

    H.R. 3039, Transitional Housing for Homeless Veterans.--The 
bill would authorize VA to guarantee loans made to providers of 
transitional housing for homeless veterans. The number of 
projects is limited to 15 and the total amount of loans 
guaranteed is limited to $100,000,000.
    The Committee estimates the first year cost at $1 million 
and the five year cost at $7 million.

    Increase Auto Allowance and Specially Adapted Housing 
Allowance for Severely Disabled Veterans.--VA is authorized to 
provide a one-time reimbursement to severely disabled veterans 
of $5,500 for the cost of an automobile. This amount has not 
changed since 1988, while the cost of a new automobile has 
increased to nearly $22,000 in 1997. VA also provides a grant 
to offset the cost of purchasing or modifying a home to 
accommodate a veterans' disabilities. The current benefit level 
of $38,000 was set in 1988.
    The Committee estimates the first year cost at $7 million 
and the five year cost at $34 million.

    H.R. 1877, Extend VA work study authority.--VA authorizes 
institutions such as colleges and other government programs to 
hire veterans to assist with veterans-related work. The program 
pays the higher of the federal or state minimum wage. The 
Committee has introduced legislation to broaden the 
organizations eligible to apply for work study positions.
    The Committee estimates the first year cost at $1 million 
and the five year cost at $5 million.

               Compensation for Tobacco-Related Illnesses

    As part of its fiscal year 1999 request, the Department of 
Veterans Affairs submitted a legislative proposal to limit 
compensation for tobacco-related illnesses to those who 
contract such illnesses on active duty or within the standard 
one year presumptive period following service. However, the 
Administration only proposes spending about $1.5 billion (9 
percent) of the OMB-estimated $16.9 billion in savings to 
improve three veterans' benefit programs. The Congressional 
Budget Office estimates savings from enacting such legislation 
at $10 billion over five years.
    VA has begun processing and paying service-connected 
disability compensation for tobacco-related illnesses as a 
result of a 1997 decision by the VA General Counsel. The 
General Counsel's decision held that if a disease or death can 
be shown to be a result of nicotine addiction acquired in 
military service, service-connected compensation is warranted.
    Following that decision, in a May 9, 1997, letter to the 
Speaker accompanying the legislative proposal, former VA 
Secretary Jesse Brown stated that such payments could cause a 
loss of public support, thereby threatening the integrity of 
the veterans disability compensation system. The Committee 
concurs with former Secretary Brown's concerns about the 
integrity of the compensation system. The Committee also 
believes that paying compensation to veterans for tobacco-
related illnesses goes beyond the government's responsibility. 
There is a significant philosophical difference between 
service-connected compensation and other disability programs 
such as Social Security or the VA pension program which make no 
distinctions based on when a disability or illness occurs or is 
first diagnosed. Service-connected compensation, on the other 
hand, is based on the presumption that a person would not have 
the illness or disability save for some event or circumstance 
beyond the person's control. A policy of paying compensation 
for tobacco-related illnesses absolves the veteran of personal 
responsibility for his or her choices about tobacco use. In the 
past, Congress has determined that the individual, not the 
federal government, is responsible for illnesses which are 
related to the use of alcohol or drugs. Thus, a policy of 
paying benefits for illnesses related to the use of tobacco 
would be inconsistent with these prior determinations.
    The Committee is also very concerned that the projected 
annual caseload of 540,000 tobacco-related claims would 
overload the adjudication system and lengthen the already-too-
long processing time for all types of claims. VA estimated in 
1997 that processing time for an original compensation claim 
would increase from 113 days to 312 days.
    To reflect the nation's commitment to its veterans, the 
Committee will recommend legislation that will use all of the 
savings from enacting a limitation on compensation for tobacco-
related illnesses to improve a wide range of programs. These 
are programs affecting our most disabled veterans, surviving 
dependents, separating service members, unemployed and under-
employed veterans, and those seeking an education or a home.
    Although the Committee is still considering a number of 
benefit enhancement proposals, the Committee has made it clear 
that an increase in the Montgomery GI Bill is warranted and 
long overdue. Therefore, to implement a 40 percent increase in 
the basic education benefit payment over the next two fiscal 
years, the Committee recommends a 20 percent increase in the 
Montgomery GI Bill benefit for fiscal year 1999 and a 20 
percent increase for fiscal year 2000. This would be the most 
significant increase in veterans' education benefits since the 
Montgomery GI Bill was enacted in 1985 and would decrease the 
gap between the cost of higher education and the level of 
benefits due to inflation in education costs.
    The cost of education has increased at over seven percent 
per year since the inception of the Montgomery GI Bill. Today a 
veteran with two years of honorable military service receives a 
maximum basic benefit of $3,213 for a nine month school year, 
from the Montgomery GI Bill (MGIB). But the average annual cost 
in 1996 for tuition, room and board, fees, books and 
transportation at a public institution was $10,759, a total 
increase of 109 percent since 1987. For private schools, the 
annual cost is now $20,003, an increase of 84 percent since 
1987.
    As a result, the Montgomery GI Bill falls short by $7,546 
annually for a public school and $16,790 for a private school. 
By way of comparison, the current AmeriCorps education benefit 
of $4,725 per year for two years exceeds the earned MGIB basic 
benefit on a per school year basis by $1,512. In addition, 
persons participating in Americorps are also eligible for 
additional benefits such as health care and child care.
    Further, GI Bill benefits count as income or resources when 
calculating a veterans' eligibility for all other federal 
education assistance programs. In stark contrast, AmeriCorps 
benefits do not count against other federal education grant and 
loan programs. As a result, because of their GI Bill benefits, 
veterans are often eligible for less federal financial aid than 
their non veteran contemporaries.

                    Additional and Dissenting Views

    ``Particularly onerous is a legislative proposal to repeal 
the VA's authority to pay compensation to veterans or their 
survivors for disabilities related to tobacco use in military 
service. The `savings' from denying compensation to those 
veterans and their families would then be used to boost 
spending for other non-VA programs. Such a proposal is an 
irrational reversal of policy. I find it totally unfair and 
unjustified to pillage veterans programs . . . ''. Arthur H. 
Wilson, National Adjutant, Disabled Veterans of America, DAV 
Magazine, March / April, 1998.
    On the proposal to enact legislation to significantly 
preclude the granting of service-connection for tobacco-related 
illnesses, the National Adjutant of the Disabled American 
Veterans unquestionably speaks for millions of his fellow 
veterans. As a matter of principle, the Administration's 
proposal to enact legislation to significantly limit the 
granting of service-connection for disabilities related to 
initial tobacco use in military service and a resulting 
nicotine addiction is rejected.
    In defending its proposal, VA has stated that the denial of 
service-connected compensation to veterans for smoking related 
illnesses resulting from a nicotine addiction developed in 
service is needed to preserve the integrity of the VA 
compensation system. In fact, the opposite is true. The 
integrity of VA's compensation system will be undermined if 
Congress were to enact new legislation prohibiting service-
connected compensation for smoking related illnesses.
    This is also an issue of equity for veterans. Social 
Security programs provide income for individuals with tobacco-
related disabilities. Once a disability is determined to be 
chronic (having a long-term effect on an individual's ability 
to re-enter the workforce), Social Security Disability 
Insurance is provided for disabled workers with an adequate 
number of work credits. Supplemental Security Income is a 
needs-based program for those disabled persons who have long-
term illnesses and limited income and resources. These programs 
do not attempt to base eligibility for those with smoking-
related disorders on a different set of criteria than exists 
for other disabilities. Neither should VA base its compensation 
for smoking-related compensation on factors other than those it 
establishes for others with service-connected disorders.
    As noted in the Committee's report, the Administration has 
assumed ``savings'' of $17 billion from enactment of this 
proposed legislation, but only $1.5 billion of these savings 
(or less than ten percent of these resources) are proposed to 
be used to enhance veterans benefits and service. Denying 
earned benefits to our Nation's veterans is injurious; using 
those ``savings'' to enhance non-veteran programs adds insult 
to that injury. While estimates of ``savings'' expected from 
enactment of the Administration's proposed legislation vary 
significantly, if such legislation were to be enacted, all 
``savings'' should be used to enhance veterans benefits and 
services, as the Committee's report has noted.
    The benefit increases for the Montgomery GI Bill education 
program and the Survivors' and Dependents' Education program 
included in the Administration's budget request for fiscal year 
1999 are long overdue, demonstrably needed, and strongly 
supported on their own merit. The real value of these programs 
has been eroding for years as the costs of education have 
soared. The needs of veteran students have been ignored for too 
long. However, the Administration's proposed linkage between 
the recommended increase in VA educational benefits and the 
enactment of controversial legislation to repeal existing 
authority to provide compensation for tobacco-related 
disabilities should be rejected. Our veteran students have more 
than earned their right to meaningful educational assistance 
through their service in America's Armed Forces. The education 
benefit increases included in the Administration's proposed 
budget are the right thing to do. The proposed increases in 
veterans' education benefits should be provided by a grateful 
Nation with no gimmicks or strings attached.
    If Congress were to accept the Administration's artificial 
and inappropriate linkage of veterans' education benefits and 
veterans' compensation, it will not only be breaking faith with 
America's veterans, but also would potentially establish a 
frightening precedent. Which existing veterans benefit will 
Congress be called on to reduce or repeal next in order to 
provide a meritorious increase for another benefit program? 
Which veterans or dependents will next be forced to forego 
current benefits so the benefits of other veterans can be 
enhanced?
    In its proposed fiscal year 1999 budget, the Administration 
has proposed legislation to pay full disability compensation 
benefits to Filipino veterans and their survivors residing in 
the United States. Currently, these veterans and survivors 
receive benefits at one-half the amount their U.S. counterparts 
receive. The Administration's proposal is strongly supported 
and recommended.
    Finally, for the record, it should be noted that the 
increase in VA research funding, which the Committee is pleased 
to recommend for next fiscal year, was proposed by the 
Administration. In this respect, the Committee should give 
credit where credit is due.

                                             Lane Evans
                                             Joseph P. Kennedy II
                                             Bob Filner
                                             Luis Gutierrez
                                             Corrine Brown
                                             Ciro Rodriguez



             STATISTICAL DATA--WAR VETERANS AND DEPENDENTS

                        (As of October 31, 1998)

                     American Revolution (1775-1784)

Participants.....................................................290,000
Deaths in service..................................................4,000
Last veteran died Apr. 5, 1869..................................Age 109.
Last widow died Nov. 11, 1906....................................Age 92.
Last dependent died Apr. 25, 1911................................Age 90.

                         War of 1812 (1812-1815)

Participants.....................................................287,000
Deaths in service..................................................2,000
Last veteran died May 13, 1905..................................Age 105.
Last widow died June 28, 1936................................Age unknown
Last dependent died Mar. 12, 1946................................Age 89.

                     Indian Wars (Approx. 1817-1898)

Participants.....................................................106,000
Deaths in service..................................................1,000
Last veteran died June 18, 1973.................................Age 101.

        Veterans and Dependents on Compensation and Pension Rolls

Surviving spouses......................................................1
Children...............................................................1

                         Mexican War (1846-1848)

Participants......................................................79,000
Deaths in service.................................................13,000
Last veteran died Sept. 3, 1929..................................Age 98.
Last widow died June. 20, 1963...................................Age 89.
Last dependent died Nov. 1, 1962.................................Age 94.

        Veterans and Dependents on Compensation and Pension Rolls

Surviving spouses....................................................287
Children..............................................................27
Veterans..............................................................15

                          Civil War (1861-1865)

                              (Confederate)

Participants..................................................*1,000,000
Deaths in service...............................................*133,821
Last Confederate veteran died Mar. 16, 1958.....................Age 112.

                                 (Union)

Participants...................................................2,213,000
Deaths in service................................................364,000
Last Union veteran died Aug. 2, 1956............................Age 109.

        Veterans and Dependents on Compensation and Pension Rolls

Surviving spouses......................................................2
Children..............................................................15

                    Spanish-American War (1898-1902)

Participants.....................................................392,000
Deaths in service.................................................11,000
Last veteran died Sept. 10, 1992................................Age 106.

        Veterans and Dependents on Compensation and Pension Rolls

Surviving spouses....................................................660
Children.............................................................326

                         World War I (1917-1918)

Participants...................................................4,744,000
Deaths in service................................................116,000
Living veterans#........................................4,800

        Veterans and Dependents on Compensation and Pension Rolls

Parents................................................................2
Surviving spouses.................................................43,687
Children...........................................................6,899
Veterans.............................................................666

               World War II (Sept. 16, 1940-July 25, 1947)

                                                            Participants
        .............................................a}16,535,
                                                                     000
Deaths in service................................................406,000
                                                         Living veterans
        .........................................b}c}6,319,000


        Veterans and Dependents on Compensation and Pension Rolls

Parents............................................................2,810
Surviving spouses................................................296,009
Children..........................................................20,084
Veterans.........................................................781,616

              Korean Conflict (June 27, 1950-Jan. 31, 1955)

                                                            Participants
        ............................................a}d}6,807,
                                                                     000
Deaths in service.................................................55,000
                                                         Living veterans
        .....................................b}c}e}i}4,179,000


        Veterans and Dependents on Compensation and Pension Rolls

Parents............................................................2,305
Surviving spouses.................................................66,536
Children...........................................................4,555
Veterans.........................................................270,794

                 Vietnam Era (Aug. 5, 1964-May 7, 1975)

Participants...............................................d 
                                                               9,200,000
Deaths in service................................................109,000
                                                         Living veterans
        .....................................b}e}h}i}8,166,000


        Veterans and Dependents on Compensation and Pension Rolls

Parents............................................................7,547
Surviving spouses................................................104,221
Children..........................................................16,106
Veterans.........................................................820,284

                  Persian Gulf War (Aug. 2, 1990-date)

Participants...............................................f 
                                                               3,700,000
Deaths in service..............................................g 
                                                                   6,526
Living veterans..........................................h i 
                                                               2,048,000

        Veterans and Dependents on Compensation and Pension Rolls

Parents..............................................................352
Surviving spouses..................................................4,605
Children...........................................................6,796
Veterans.........................................................244,781

                America's War Totals Through July 1, 1995

                                               Participants##
                 ................................f}41,746,000
                                                       Deaths in service
         .........................................g}1,090,200
Living war veterans...........................................19,300,400
Living ex-servicemembers......................................25,188,400

     Total Veterans and Dependents on Compensation and Pension Rolls

                                                                 Parents
        ......................................................l}
                                                                  13,016
                                                       Surviving spouses
         ...........................................m}516,008
                                                                Children
        .....................................................k}
                                                                  54,809
                                                                Veterans
        ..................................................j}1,3
                                                                  36,540

                               __________

#}Living veterans does not include World War I veterans with 
military service in other eras.
##}Persons who served in more than one war period are counted 
only once.
*}Authoritative statistics for Confederate forces not 
available. Estimated 28,000 Confederate personnel died in Union prisons.
**}Children connotes a minor or a helpless adult.
a}Includes 1,476,000 who served in World War II and the 
Korean conflict.
b}Includes 217,000 who served in World War II, the Korean 
conflict, and the Vietnam era.
c}Includes 518,000 who served in both World War II and the 
Korean conflict.
d}Includes 887,000 served in the Korean conflict and the 
Vietnam era.
e}Includes 303,000 who served in both the Korean conflict and 
the Vietnam era.
f}Through end of October 1998.
g}During fiscal years 1991 through 1995 for Persian Gulf War.
h}Includes 244,000 who served in both Persian Gulf War and 
the Vietnam era.
i}Includes small number who served in the Persian Gulf War, 
Vietnam era, and the Korean conflict.
j}Includes 513,644 peacetime veterans with service between 
January 31, 1955, and August 5, 1964; peacetime veterans with service 
beginning after May 7, 1975, and all other peacetime periods; 5 World 
War I Retired Emergency Officers and 1 Peacetime Special Act.
k}Includes 9,024 children of deceased peacetime veterans.
l}Includes 2,993 parents of deceased peacetime veterans.
m}Includes 37,185 surviving spouses of deceased peacetime 
veterans.

NOTE: Figures on the number of living veterans reflect final 1990 Census 
data and include only veterans living in the U.S. Detail may not add to 
total due to rounding.
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