Before i call the meeting to order let me apologize fob being a little late i got called on a couple things coming down the hall. Were going to stand at ease thats a military term i learned a long time ago in the air force for just one minute while i talked to my trusted friend the Ranking Member and then well open the meeting. Call this meeting the Senate VeteransAffairs Committee together i apologize for being a little bit late but i wanted to make sure we were on the right track and i didnt mess anything up. I want to welcome secretary shulkin whos had a great start. I dont think anybody started out with a better unanimous vote than he, you cant do any better than unanimous when you get affirmed. I think the vote last week on accountability was extraordinary. And the way we got to the decision working together hand in hand was extraordinary and i commend the Ranking Member on his help in doing the same. Weve got some other things to do today to Start Talking about budget wise and well have some other decisions to make, but we can keep the same tempo and discipline to make sure we all know what each other knows before what happens rather than after the fact and well be better off. But i welcome dr. Shulkin and the staff thats here today. And i appreciate what theyve done to explain where were doing with the Veterans Administration which is upward and outward and further ahead all along. Im going not make a long statement at all except to say a couple things and i dont want to make this david sthul kin day but one other thing i have to brag about, the certainer decision in getting our medical records solved after years of unwillingness to address it is extraordinary. And i think, from what i have heard, theyre already signed saying people are coming together in the past hadnt been together to make sure this happens and works efficiently for our veterans and for the department of defense and the department of Veterans Affairs at the same time. It was sillily to have two different agencies in the same department serving the same government that had two medical systems that were not inner operable one to the other and where our veterans who fought for us with literally fall in a hole leaving from active duty to department of defense to vat transaffairs. I think this move is going to prove to be a tremendous move economically for the va and benefit wise for our veterans and theres no possible way do any better than that so i commend on you that decision as well. With that, instead of getting into details im going to turn for an Opening Statement to the Ranking Member jon tester. Thank you, mr. Chairman and thanks for having this hearing. I think its important to say that our thoughts are with the colleagues who were with the victims this morning. We wish you a speedy recovery for congressman scalise and everybody else who was injured. And a big, big thank you to the Capitol Police officers who work every day to make sure this place is a safe place. And our thoughts are with them. Now, secretary shulkin i want to thank you for being here and being here with your va team. We spoke last week at some length about the future of the Choice Program and i hope i made my perspective clear the Choice Program was intended to supplement care, provided directly by the va, not replace it not now and not into the future. I worry that the budget proposed by this Administration Starts us down a path of unfettered choice that will hollow out the va in doing it so it proposes to cut income by a third white proposing that the vas own hospitals receive ann crease that is less than half the medical inflation rate, not much. Further the budget does nothing to address vas aging infrastructure. If were starving the funding for staff and care for velt rans while also denying them money to address the environment care concerns, we know what that outcomes going to be. Soon enough there wont be any quality va hospitals staffed by quality providers and it will become nothing more than to send veterans into the private sector to hunt for a doctor who has the time and capacity and knowledge to treat them. That is not what our set transneed and want to have happen and for a rural state like minnesoontana, it would be disaster. More and more hospitals are at the risk of closingand finance there are rollbacks to recent medicare expansions its likely these close yours would accelerate. We cant assume the private care will work where there are no providersed in the first place or where they dont have suffer net works. We know the vast majority of slet velt transusing choice over the past two years are eligible due to long wait lines not because they live too far from a va facility. It shows that rural veterans arent using choice as much but they do depend on va care. But now based on your quest yesterday we may have to shift additional funds around and out of va care accounts to get Choice Program through the fiscal year. For months weve been asking about the choice to spend rate and the amount of funds and the amount of remaining funds. We were never provided with those answers we need to make informed decisions and now were in a difficult spot. Mr. Secretary, no one wants delay and care for veterans, no run, and we will act appropriately in a timely manner to solve this problem. But for that to happen this late in the game is a bit frustrating to me and its compound by a budget that cuts services that veterans rely on, makes cost education oversight, makes cuts to i. T. Which impacts every business line and department operates. Im most concerned that it appears these cuts are being made in order to pay for certain veterans to get private care. The new policies propose this budgeting to pay for private care are simply untenable. It would, without warning stopped earned benefits payments to the most severely disabled vets is not proper. To get the individual unemployment benefit payment it must be determined that a vat trens unable 10 to gauge in substantial work as a direct result of service to their country. Appears that the budget proposes that we stop paying these veterans at a time when more americans are having to work longer to make longer in their lives to make ends meet and all in the name of finding more money for choice. Thats a nonstarter and i hope we can get your commitment today to keep this important benefit in place. So i look forward to work with my colleagues both sides of the aisle to address these concerns and look forward to hearing from you and how you intend to prioritize funding for veterans who get care and benefits directly from the va. And finally i would like to wish the u. S. Army a happy birthday. With that, thank you, mr. Chairman, i look forward to your testimony. Secretary shulkin. Secretary, welcome and let me introduce those you brought with you to back you up and acup along the way. Edward murray thank you for being here, richard chandler, Department Assistant secretary resource management, marc you, james man ker, acting principle pal deputy, mr. Michael sullivan director secretary of defense and planning, mr. Shulkin, the floor is yours. Thank you, Ranking Member tester and other members of the committee. As you can see i brought a big team with me because i know youre going to have lots of questions and in particular with the Opening Statements i really do look forward to having a meaningful discussion and getting to some solutions and some closure on some of these issues. I also did want to echo the Ranking Members concern that this is a sad day for the nation where Public Servants who work as hard as i know all of you do have to worry about their personal safety and our thoughts and prayers are with the congressman and the staff and the Capitol Police as well. So thank you again for allowing us to be here today. What we want to talk about today is the 2018 president s budget and the 2019 advanced proegs appropriations. And all of this is in showing support to veterans and we appreciate the leling e leg slailgs slags thats recently been passed. You passed just within the past week the accountability bill and that went through the house yesterday. Were looking forward to actually next tuesday bringing it for a signature for the president , and thats good news. We also appreciate your support for the veterans choice improvement act that you supported and for providing us really for the first time in a long time the full 2017 budget. This is really allowed us to make Real Progress for veterans and were, again, grateful for that support. Ive submitted the full written statement for the record so let me just start by thanking you again for allowing us to participate in the hearing last week. Seems like we were just here with you. But i thought it was an excellent hearing, a good discussion on choice, and that type of discussion and dialogue is going to allow us to help get it right for veterans. When i testified before the house Veterans Affairs committee on march 7th, we had 2. 0 billion in the choice account. Less than a month and a half later when the president signed the choice extension act into law, our choice account was at 1. 5 billion. Today that aket is at 821 million. As we nope, more veterans than ever are using choice. Weve authorized 8. 2 Million Community care appointments since january of this year, thats 2. 6 million more than last year or a 46 increase. In fact, march, april, and may were the largest months ever for choice. And frankly that happened because we fixed so many of the problems that weve all been working to fix with choice, and weve been increasing our use of choice. One of the reasons why is the 17 budget, as you may remember, actually had 2 billion less in Community Care so weve been mutting more putting more through choice. Two years ago im sooul sewer sure youll remember we had too little money in our community accounts within the va which we solved with your help by accessing unused us funds in the choice account. So we transferred money from choice into Community Care. We now have too little money in the choice account which were working to solve, again, working with you with legislative authority to replenish funds into the choice account. So this is the situation that weve described before where for a single purpose of providing care in the community we have two checking accounts, and i will tell you i wish it were easier than it is. We have to figure out how to balance these two checking accounts at all times, and obviously its not a science, its an art and were having difficulty with that once again. And thats why we need to work with you to solve it. The Veterans Care Program that we outlined four last week will solve this recurring problem permanently by modernizing and consolidating all of the Community Care accounts including choice. The president s budget in 2018 and 19 provides additional funds for choice and the resources necessary to continue the ongoing modernization of the v. A. Requests whun 86 billion for v. A. , whun 4. 3 bund u funding in mandatory funding and 1. 83 billion in discretionary funding for a total of 6. 3 over 2017. 2 provides 2. 9 billion in mandatory funding to continue the Choice Program in 18 34rus a 7. 1 increase in discretionary funding for vha to improve Patient Access and timeliness of care. It supports the strengthening of Foundational Services as well as modernization as consolidating v. A. Community care through the veteran care Program Announced last week. So veterans can make the right decisions about their care together with their physician or provider giving them yet another reason to choose v. A. This budget reflects the president s strong personal commitment to the nations veterans. Its also a budget we need to achieve, providing greater choice for veterans, modernizing our systems, focusing our resources towards whats most important for veterans, improving the timeliness 6 our systems, and suicide prevention. Were already taking steps to meet the challenges that we face. At the president s direction, weve established a v. A. Accountability office. The recent decisions made by the senate and house will help us with that. Weve recently removed two Medical Center directors and three other Senior Executive service leaders. We simply will not tolerate employees who act counter to our values or put veterans at risk. I announced a waste Prevention Advisory Committee which will be set up and running this summer. I directed the v. A. Office remain under a hiring freeze, those are for administrative positions as we consolidate program offices, implement shared services and realign overhead to get more money back to the field. We now have Sameday Services for primary care and Mental Health at all of our Medical Centers. Veterans can access wait time data for local vas using online easy to use tool to understand access and quality. No other Health System in the country has this type of transparency. Weve made it easier for them to fill out online Healthcare Applications so much easier in fact that since last summer weve received eight times as many online applications than the year before. Last month we were able to process a disability claim in just three days. I said that right. A disability claim processed in three days using a new process called decision ready claims. Well problem deucing decision ready claims nationally september 1st. At our regional offices well be completely paperless for claims by mid2018. A few months ago the Veterans Crisis line had a call rollover rate of more than 30 . Today that right is less than 1 . Weve launched a new Predictive Modeling tool allowing va to provide proactive support for veterans who are at higher risk for suicide. Were also lawn offing a new initiative this summer getting to zero to hips end veterans suicide. This is my top priority. But to keep moving forward were going to need your help. Weve identified over 1,000 facilities that are either vacant or underutilize and were work to move forward with 142 of those facilities and with your help we could do more of the same. We need congress to fund our i. T. Modernization to keep our legacy systems from failing and to replace vista with a system already in use by the department of defense. This will ultimately put all patient date at in one shared system enabling seamless care between the v. A. And d. O. D. Without manual and reconciliation of data between separate systems. We also need congress to authorize an overhaul of broken and failing claims appeals process. Weve worked closely with vso easy and other stakeholders to draft a proposal and modernize the system and we we are pleased to see the house unite behind the bill last month now we just need the senate to act. Most of all we need congress to ensure the continued success of choice for veterans. Veterans are responding to our modernization efforts by choosing va more than before. To keep up with those choices we need to fully fund choice and help us modernize and consolidate va Community Care through the Veterans Care Program the program will coordinate care so they get the right care at the right time with the right provider whether in a va facility or from a highperforming va Community Care provider. We just need your help to make it happen return colluding funding to keep up with veterans as they choose va. Thank you and we look forward to your questions today. Thank you, dr. Shulkin we appreciate your attendance today. I want to start off with my questions on the appeals process. I have consistently said that any change in the process to improve it must include an acceleration of and dealing with a 470,000 veterans choez whose claims are pending today at the va. Would you agree with that . I would like to see that happen. Im going to give you a second question was a chance to make a commitment on that. If both appeals reform and budget request are adopted in this budget, would va be able to begin accelerating decisions for those 470,000 appeals that are pending . The appeals that are in the board of the board of appeals are the ones that were most concerned about. If the senate votes to move the appeals modernization forward as i think youre saying, mr. Chairman, we will have a process to expedite those from the time that the law passes in moving forward. Youre asking about the legacy claims. Right. And appeals. We do not have a plan to make significant progress on those. Were going to have to whittle away at them. The budget this year will add 142 more staff to the board that will allow us to mange contract mental progress. But i think to deal with the backlog wed be looking at 2026 before we dealt with the backlog. The one hope that i have, mr. Chairman, rather than adding a large number of staff to deal with the backlog, is, is that we will give current veterans who are in the appeals process the option of opting in to the new process. And if they choose to opt in, but its going to have to be their choice, they would be able to have their appeal dealt with in the expedited fashion in the faster fashion. So this is my hope to be able to accelerate the backlog to encourage veterans to who unfortunately right now would have to wait years to get decisions to opt into the new process. Well, first of all, let me commend you because you just gave a patently honest answer to my ques