	Recent Developments

On September 9, 2004, the House Committee on Appropriations reported a bill makingappropriations for the Departments of Veterans Affairs and Housing and Urban Development, andIndependent Agencies for FY2005 (VA-HUD appropriations bill) ( H.R. The Committee rejected the Administration's proposalto fund VHA through an alternative appropriations structure, in which the VHA budget would havebeen consolidated into two business lines: medical care, and medical and prosthetic research. The Senate Committee on Appropriations reported its version of the VA-HUD appropriationsbill for FY2005 ( S. 2825 ) on September 21, 2004. (2) Under S. 2825VHA would receive $30.4 billion in FY2005. This is a $2 billion increase from FY2004, and $1.2billion more than the President's request. On November 20, 2004, both the House and Senate adopted the conference agreement toaccompany the Consolidated Appropriations Act, 2005 ( H.R. 108-447 ). (4) Under P.L.108-447 VHAwould receive $30.3 billion in FY2005 an increase of $1.2 billion over the FY2005 appropriationrequest, and $1.9 billion over FY2004. Veterans Health Administration (VHA)

The Department of Veterans Affairs (VA) provides benefits to veterans who meet certaineligibility rules. Benefits to veterans range from disability compensation and pensions, education,training and rehabilitation services, hospital and medical care, and other benefits such as home loanguarantees and death benefits (including burial expenses). VA provides these benefits to veteransthrough three major operating units: the Veterans Health Administration (VHA), the VeteransBenefits Administration (VBA) and the National Cemetery Administration (NCA). 5041 recommended $30.3 billion for VA medical programs for FY2005. This is an increase of $1.2 billionover the President's request and $1.9 billion over FY2004. 4818 , P.L. (23) The bill was signed intolaw by the President on December 8, 2004. According to theconference report, the conferees continue to believe the current account structure started in FY2004,composed of four accounts -- medical services, medical administration, medical facilities, and medicaland prosthetic research -- "will provide better oversight and achieve a more accurate accounting offunds." 108-674 ; S.Rept.108-353 ; H.Rept. Among the most significant legislative and regulatory proposals in thebudget are:
Increasing veterans' share of pharmaceutical copayments from $7 to $15 (foreach 30-day prescription) for all enrolled veterans in Priority Groups 7 and 8;
Increasing veterans' share of copayments for outpatient primary care from $15to $20 (for each medical appointment) for all enrolled veterans in Priority Groups 7 and8;
Establishing an annual user fee of $250 for all enrolled veterans in PriorityGroups 7 and 8; 
Ending pharmacy copayments for veterans in Priority Groups 2 through 5 withincomes between $9,894 and $16,509; this would allow approximately 394,000 veterans to receiveoutpatient medications without having to make a copayment; (28)
Ending long-term care copayments for former prisoners ofwar;
Authorizing the department to pay for emergency room care or urgent care forenrolled veterans in non-VA medical facilities;
Ending hospice copayments. The FY2005 VA-HUD appropriations bills reported by the House and Senate Committeeson Appropriations and the final conference agreement to accompany the ConsolidatedAppropriations Act, 2005, did not include any of the copayment changes that had been proposed inthe President's budget request. Appendix 1.
The Department of Veterans Affairs (VA) provides benefits to veterans who meet certaineligibility rules. Benefits to veterans range from disability compensation and pensions to hospital andmedical care. VA provides these benefits to veterans through three major operating units: theVeterans Health Administration (VHA), the Veterans Benefits Administration (VBA) and theNational Cemetery Administration (NCA). VHA is primarily a direct service provider of primarycare, specialized care, and related medical and social support services to veterans through anintegrated health care system. Veterans are enrolled in priority groups that determine payments forservice and nonservice-connected medical conditions. In FY2004, Congress appropriated $28.4billion for VHA to be spent through an account structure composed of four new accounts: medicalservices, medical administration, medical facilities, and medical and prosthetic research.
For FY2005, the Administration submitted its budget request to Congress using a newaccount structure that consolidated several accounts into two "business lines": medical care, andmedical and prosthetic research. The Administration requested $29.1 billion for VHA for FY2005.
On September 9, 2004, the House Committee on Appropriations reported the FY2005appropriations bill for the Departments of Veterans Affairs and Housing and Urban Development,and Independent Agencies for FY2005 ( H.R. 5041 ) ( H.Rept. 108-674 ). The Committeerejected the alternative appropriations structure recommended by the Administration andrecommended $30.3 billion for VA medical programs for FY2005. This is an increase of $1.2 billionover the President's request and $1.9 billion over FY2004. On September 21, 2004, the SenateCommittee on Appropriations reported its version of the FY2005 VA-HUD appropriations bill, S. 2825 ( S.Rept. 108-353 ). Under S. 2825, as reported, VHA would havereceived $30.4 billion in FY2005. This is a $2 billion increase from FY2004, and $1.2 billion morethan the President's request. On November 20, 2004, both the House and Senate adopted theconference agreement to accompany the Consolidated Appropriations Act, 2005 ( H.R. 4818 , P.L. 108-447 ). The bill was signed into law on December 8, 2004. Under P.L.108-447 , VHAwould receive $30.3 billion in FY2005 -- an increase of $1.2 billion over the FY2005 appropriationrequest, and $1.9 billion over FY2004.
In its budget submission to Congress, the Administration also proposed several legislative andregulatory changes to increase certain copayments and other cost- sharing charges for lower-priorityveterans and to reduce copays for certain veterans. The House and Senate Committees onAppropriations, and the final conference agreement did not accept any of the Administration'scost-sharing proposals for VHA. This report will not be updated.