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The Committee has long been concerned about the excessing of property belonging to the Veterans' Administration, particularly when it IS known that additional property will be needed beyond the year 2000 to take care of the health care needs of the aging veteran population. The Veterans' Administration has reported that since September, 1970, the Veterans' Administration has transferred from its jurisdiction over 1,600 acres of land. The Committee is concerned that the VA is already turning away over 35,000 veterans monthly. The Committee is also concerned with the documented forecast of a increase in the number of veterans 65 years of age or over who will need health care treatment at VA facilities in the next two decades. The Committee believes this acreage may be needed for improvement or expansion of the presently overburdened medical facility system. This belief has been accelerated by the high cost of leasing space for regional office and outpatient activities, since it has proven more cost-effective to construct such facilities on Veterans' Administration medical center property.

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As with conventional loans, the high unemployment rate in the early 1980's caused a substantial mortgage foreclosure increase in VA guaranteed home loans. Faced with record-high deficits, and in an attempt to budget for outlays which resulted from loan guaranty commitments, the Administration recommended proposals in the last three VA budgets which were directed only toward a single year's budget outlay rather than toward any true reduction in budget deficits with long-range deficit effects.

The FY 87 budget contains an optimistic prognosis and appropriations will not be necessary in FY '87 to operate the program. The Committee believes that the VA Home Loan Guaranty Program is not only beneficial to veterans but also helps to boost the economy by providing a source of credit reinforcement without which the building industry might tend to languish.

In an effort to assure the continuation of this program, which has benefited more than 11.9 million veterans, the Committee plans to consider legislation directed at the future solvency of the program. The Committee believes this can be done by the use of fee basis attorneys to foreclose VA portfolio loans and collect debts, modifying current debt collection procedures, and holding the VA harmless for the guaranty where the lender has improperly underwritten and/or documented a mortgage at the time of origination and subsequent foreclosure action on a mortgage resulting from a delinquency within four months of the origination date.

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Section 5010 of title 38, U.S.C. requires the VA to operate and maintain not less than 90,000 hospital and nursing home beds. Public Law 99-160, the HUD-Independent Agencies Appropriation Act for fiscal year 1986, mandated a VA medical staffing level of 193,941. Yet, the proposed Administration budget for medical care for fiscal year 1987 contains reductions in FTEE of 8,927 and proposes to operate only 85,578 hospital and nursing home beds. Of the reduction in FTEE. 6,988 will result from treating fewer veterans and 1,939 through "productivity increase". When the cut of 1,306 FTEE resulting from P.L. 99-177 (the Balanced Budget and Emergency Deficit Control Act of 1985) is considered, existing VA medical staff will have been cut by 10,233 persons during the single calendar year of 1986.

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The VA reports that each month it is now turning away over 35,000 eligible veterans. The generally acknowledged increase in medical care needs from a rapidly aging eligible veteran population is already being felt and will continue to increase until an expected peak in the year 2000. As was stated in the report to the Budget Committee for fiscal year 1986, it is clear that resources must increase Over the next two decades to meet this large and increasing demand.

The Committee is recommending a restoration of the funds and personnel necessary to maintain a current services level in the VA health care system. This recommendation includes funds for projected salary levels for 193,941 FTEE during fiscal year 1987.

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The proposed budget would reduce funding for medical facility construction by approximately 41 percent from the fiscal year 1986 budget. The committee views this as a shortsighted savings since both the age and condition of the capital plant of the VA and the rate of change in the practice of medicine require regular infusions of resources. Even beyond concern with the physical and technological aging of facilities. inadequate current capacity results in the turning away monthly of over 35,000 eligible veterans needing health care, a number expected to increase with the anticipated needs of aging veterans. The situation in the sun belt states, among them Florida. is even more severe There have been numerous studies and reports documenting the existing high level of need, as well as the rapid growth in need, caused by migration to Florida.

The Committee is recommending the inclusion of funds for site acquisition of the Palm Beach Hospital and design funds for VAMC Pittsburgh (Aspinwall Division).

No new nursing homes are being requested in the budget while the VA'S five-year construction plan calls for four nursing homes for this fiscal year. Current problems in the distribution and availability of all nursing home beds are evidence of how seriously flawed and ill-advised is the proposed complete dependence on alternative sources of nursing home beds, such as community nursing homes and conversion of hospital beds to meet the need for such care by veterans. The proposed nursing home projects at Hampton, Virginia and Tampa, Florida, are in areas where there is no alternative source of beds

The Committee is recommending the inclusion of funds for nursing home construction projects at Hampton, Virginia, and at Tampa, Florida.

In addition, the Committee notes that in fiscal year 1996, it authorized the 60-bed Wilkes-Barre project in the full amount requested of $4.1 million. Subsequently, the VA was directed by the Committee on Appropriations in the report accompanying H.R. 3038, the Department of Housing and Urban Development-Independent Agencies Appropriation Bill for fiscal year 1986, "to proceed with the design of a $4.1 million 60-bed nursing home care unit project at Wilkes-Barre in 1986."

The Committee anticipates that the balance of the $4.1 million will be included in this year's appropriations bill, SO that the constructed in fiscal year 1987.

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DEPOSIT MAR 28 1986

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