June 17,1999

Committee to Take Up Veterans Health Care Bill Thursday

WASHINGTON -- The Senate Finance Committee will meet on Thursday, June 24 at 10:00 am in room 215 of the Dirksen Senate Office Building to mark up the Medicare Subvention Demonstration for Veterans Act of 1999, legislation creating a three year project that will allow veterans who are eligible for Medicare to receive their health care at a Veterans Affairs (VA) facility.

The legislation under consideration amends title XVIII (Medicare) of the Social Security Act to authorize the Secretaries of Health and Human Services (HHS) and Veterans Affairs (VA) to establish a 3 year demonstration project for veterans. This demonstration project would allow the Secretary of HHS to reimburse the Secretary of VA for Medicare-covered services provided to targeted Medicare-eligible veterans at a VA Medical Facility.

The Chairman's mark will be available on Tuesday, June 22.

Background on the Department of Veterans Affairs (VA) and Subvention:

The VA operates the nation's largest health care system, encompassing 172 hospitals, 439 outpatient clinics, 131 nursing homes, 206 counseling centers, and 4 domiciliaries (live-in health care facilities). In 1996, the VA health system reorganized into 22 Veterans Integrated Service Networks (VISNs). Each VISN manages all resources within a region, integrating services to avoid duplication and increase efficiency. The VA estimates that approximately 3.1 million individual patients were served during FY 1997.

Unlike Medicare, under which services are provided to beneficiaries based on entitlement eligibility for them, VA medical benefits are available to veterans on the basis of a priority system. The priority system determines relative access to services at facilities in which resources may not be sufficient to accompany all veterans. The priority 7 veterans, those who do not have service-connected disabilities and/or do not meet the low-income threshold, have the lowest priority in receiving health care benefits at a VA health care facility. It these veterans that are targeted in the Veterans subvention proposal. There are approximately 4 million priority 7 veterans that are Medicare eligible - about half of the total veterans population.

Veterans subvention is very similar to DoD subvention - it is a demonstration in which Medicare-eligible veterans can receive comprehensive health care at Veterans health care facilities (hospitals, clinics, etc.). The VA is reimbursed by the Medicare program for a veteran's health care.

The Balanced Budget Act of 1997 mandated that a detailed implementation plan for Veterans subvention (that models the DoD demonstration) be submitted to Congress jointly by the Secretaries of Health and Human Services and Veterans Affairs. This plan was recently submitted to Congress.

Finally, over the past few years, there have been numerous Veterans subvention proposals introduced, both in the House and Senate. In the 106th Congress, Senator Jeffords introduced S. 445, the "Veterans' Equal Access to Medicare Act" on February 23, 1999. On February 24, 1999, Senator Rockefeller proposed an amendment 26, the "Medicare Subvention Demonstration Project for Veterans" to S. 4, the Military Bill of Rights, which passed the Senate. Both S. 445 and the Rockefeller amendment contained identical language for a Veterans subvention demonstration project.