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March/April 2007

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In early February, the following letter was sent by VVA and five other VSOs to Deputy Secretary Gordon Mansfield.

Dear Secretary Mansfield,

The undersigned veterans service organizations appreciate the opportunity to provide comments on the revised solicitation for Project HERO.

We had been advised that the revised RFP, issued on January 12, 2007, would have a more limited scope, with its primary objective to reduce overall VA contract care costs while improving service to veterans eligible for, and now receiving, VA contract health care services. Our immediate concern with this solicitation was contract language that would have permitted a 500 percent increase in dollars expended for contract care in FY’05 for each of the specialty care items listed in the solicitation that would be subject to award.

After hearing our concerns, your staff advised us on February 2, 2007, that this maximum limitation will be reduced, not to exceed 150 percent of FY’06 contract expenditures for medical and surgical costs, and 200 percent for all other specialties and services. While we appreciate this reduction in scope, and certainly the professionalism and courtesies of your staff in attempting to assuage our concerns, we remain concerned that this pilot project may result in an overall increase in contract care costs and further erode the already limited resources available to provide clinical care within the VA.

Also, we are concerned that the Appropriations Committees’ original direction to the VA, to recognize and be sensitive to the importance of academic affiliations, may not have fully been reflected in the development of the solicitation. The appropriators recognize those affiliations are precious assets. Their loss would be a serious blow to the quality of care available to veterans.

We are proud of the accomplishments of the Department of Veterans Affairs in health care and do not want what has become a model for the nation to deteriorate by expansion of contracted care dollars into a market that reduces VA control over the quality of care provided. We remain skeptical that your department can accomplish through contract relationships in the future what it directly controls today. We fear, too, that costs of implementing this contract will exceed benefits to veterans served by the VA.

We will continue to monitor the development of this pilot program and look forward to continued involvement in this process. We have been advised that it is the intent to reduce the overall contract care costs and ensure a high level of quality; we look forward to the establishment of a monitoring program to ensure this goal.

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