Lawmakers Agree to Help Veterans Agency Fill a Budget Gap


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Sloan D. Gibson, deputy secretary of the Department of Veterans Affairs, on Capitol Hill.

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Zach Gibson/The New York Times

WASHINGTON — Republican lawmakers said Thursday that they would support legislation allowing the Department of Veterans Affairs to shift money from another program to cover a $2.5 billion budget shortfall that would otherwise threaten medical care for many patients in coming months.

Representative Jeff Miller, Republican of Florida and chairman of the House Veterans Affairs Committee, said at a hearing on Thursday that he would work with other lawmakers to help cover the budget gap.

The money would come from a new program called the “Choice Card,” which allows certain veterans on waiting lists and in rural areas to choose taxpayer-paid care from private doctors outside the department’s health system. The program has been a priority for Republicans, who say using private doctors will help reduce health care waiting lists for veterans and will inject a measure of competition into an inefficient agency.

The shortfall surfaced just months after lawmakers were told that the agency was actually under budget for the fiscal year. But soaring demand for medical care from veterans has exceeded even the most aggressive predictions about how much, and how quickly, the agency would have to grow to put last year’s waiting list scandal behind it.

Overall patient demand at the veterans agency has grown more than 10 percent in the past year, and some regions have seen physician workloads grow nearly twice that amount, according to department calculations. While the average wait time for most appointments is only a few days, the number of patients on waiting lists of a month or longer is now 50 percent higher than a year ago.

The principal cause of the scandal over delayed care was a significant shortage of doctors, nurses and office space; agency officials have since hired 1,000 physicians and nearly 3,000 nurses, and leased or expanded clinical space by more than a million square feet. Over all, patients had seven million more appointments in the past year — either inside the department’s hospitals and clinics or at outside doctors to which the agency referred them — than a year earlier.

The cost pressures also follow recent approval of new treatments for hepatitis C — a serious liver disease affecting 180,000 veterans — that typically costs $60,000 to $100,000 for a full course of treatment that lasts several months.

Like other major health care plans, the veterans department has struggled to pay for the drugs, and it even outlined a plan last month to begin prioritizing treatments among patients — provoking sharp dissent among some of its own doctors who objected to any plan to ration the drug, which has higher cure rates and fewer side effects that other treatments.

On Thursday, the department’s deputy secretary, Sloan D. Gibson, said every patient whose doctor deemed them to need the new treatment will get it — even if it means sending them to doctors outside the agency.

Mr. Gibson said demand for the agency’s health care was soaring partly because it was less expensive than other options. While four out of five veterans have other health insurance, co-pays and other financial terms are often far more advantageous at the department’s hospitals and clinics. “As V.A. improves access, which we are continuing to do, more veterans are going to come to V.A. because they want to come to V.A., and because they have a financial incentive to come to V.A.,” he said.

The budget gap deeply angered Republicans lawmakers on Thursday who said it was unfathomable the department could not have seen it coming.

“I have come to expect a startling lack of transparency and accountability from V.A. over the last years,” Mr. Miller said. He called the latest shortfall “disturbing on an entirely different level,” coming so soon after the department sought funding to cover construction cost overruns, which he called “lower priority.”

Mr. Gibson, who testified before the committee on Thursday, admitted that failure to recognize the shortfall was “inexcusable” and blamed outdated financial management systems for not signaling the gap sooner.

While congressional action is still needed to authorize the department to shift funds to cover the deficit, the apparent agreement on Thursday to provide that legislation was a victory for several veterans groups, which have said for years that health care budgets failed to fully account for tens of thousands of service members with profound injuries from Iraq and Afghanistan, as well as an aging Vietnam-era population.

Four major groups — Amvets, Disabled American Veterans, Paralyzed Veterans of America and the Veterans of Foreign Wars — said in a joint statement that the shortfall “continues a pattern of inadequate resources for rising demand that we have identified regularly for more than a decade, yet our calls for sufficient resources have too often fallen on deaf ears.”

Republican support to cover the gap, however, might also be contingent on an agreement for new budget provisions that will restrict money set aside for treatment from outside doctors in later years — thus making it harder for the department to cover future shortfalls through similar maneuvers.

“Going forward, there must be a dedicated appropriation account to fund non-V.A. care under a single, streamlined, integrated authority with a dedicated funding stream contained within V.A.’s base budget,” Mr. Miller said.



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