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Testimony on the Relationship Between the VA and Academic Medicine

Good morning and thank you for the opportunity to join you this morning to discuss the relationship between the Veterans Health Administration and academic medicine, and the stake that academic medicine has in VHA's future. I am John Clarkson, M.D., senior vice president for medical affairs and dean of the University of Miami School of Medicine and a member of the Association of American Medical College's VA-Deans Liaison Committee. I am here this morning as a representative of the AAMC, which represents the nation's 125 accredited allopathic medical schools, over 400 major teaching hospitals and health systems - including 74 VA medical centers, 100 academic and scientific societies representing over 105,000 faculty, and the nation's medical students and residents.

Before I begin this morning, I'd like to provide some statistics that demonstrate why the AAMC and academic medicine have such a large stake in the future of the VA health care system. Next, I'll offer a very brief overview of the history of the relationship between the VA academic medicine. I will then outline the current status of the relationship and then offer some thoughts on the future.

Currently, 107 of the 125 medical schools maintain formal affiliation agreements with VA medical centers. Each year more than 30,000 medical residents and 22,000 medical students receive a portion of their medical training at a VA facility. The VA is the nation's largest provider of graduate medical education, supporting about 10 percent of all residency positions in the country. VA estimates that about 70 percent of its physician workforce also have university appointments. Some medical school deans report upwards of 95 percent of the staff at their affiliated VA hospital have dual appointments.

At the end of World War II, leaders of the Veterans Administration knew they were faced with the problem of being prepared to deal with the large number of veterans who would need medical care. Of particular concern was the shortage of qualified VA physicians to provide services to the increasing numbers of veterans needing health care services. Simultaneously, medical schools were looking for ways to expand graduate medical education opportunities to accommodate all the physicians that had gone into the armed services without completing specialty training.

Paul B. Magnuson, M.D., who chaired the department of orthopaedic surgery at Northwestern University Medical School at the time, was one of the people called upon to help resolve this dilemma. He found that the VA shortage of physicians was caused in part by bureaucratic red tape and the poor reputation of VA medicine. Dr. Maguson suggested that affiliations between medical schools and VA hospitals would solve VA's problem by allowing medical school deans to staff VA hospitals with top-notch medical school faculty physicians, residents and interns. The affiliated VA facilities, in turn, would provide medical schools with new venues in which to educate young physicians. Public Law 79-293, enacted on January 3, 1946, provided the legal basis for affiliating with schools of medicine, and established the VA Department of Medicine and Surgery, the predecessor of the Veterans Health Administration. Later that same month, VA published Policy Memorandum No. 2, the "Policy on Association of Veterans' Hospitals with Medical Schools." The memo decreed that the VA would retain full responsibility for the care of patients, and that the school of medicine would accept responsibility for all graduate education and training. The affiliations were intended to afford "the veteran a much higher standard of medical care than could be given him with a wholly full-time medical service." The first affiliation was established in 1946 between the Hines VA medical center in Chicago and Northwestern University Medical School. Policy Memorandum No. 2 still guides the VA-medical school affiliations today.

Policy Memorandum No. 2 also called for the establishment of Deans Committees for each affiliation. The Deans Committees were to be composed of senior medical faculty from the appropriate departments and divisions at the affiliated medical school and would be responsible for implementing and integrating residency programs with the VA facilities as well as nominating faculty and trainees from the medical school for appointments as full- or part-time faculty at the VA. The Veterans Hospitalization and Medical Services Modernization Amendments of 1966 gave statutory authority to the Deans Committees and also made medical education and training a formal component of VA's medical care mission. The same 1966 law authorized VA to enter into agreements with medical schools to share specialized medical resources such as equipment, personnel, or space that might increase utilization or otherwise not be available. VA's educational role has continued to evolve over the 50+ years of affiliations and certainly will continue to do so in the new environment.

Throughout the history of the VA affiliation agreements, VA's construction policy had always favored sites near existing medical schools, and for the same cooperative and efficiency reasons, medical schools often built facilities near existing VA hospitals. Under the 1972 VA Medical School Assistance and Health Manpower Training Act, VA provided grants to expand existing medical education programs and facilities as well as to establish five new medical schools (Marshall University, Wright State University, East Tennessee State University, Texas A&M University, and the University of South Carolina) next to existing VA medical centers.

The Omnibus Health Care Act of 1976 provided statutory authority for the VA research mission in order to protect the VA research program from potential reductions in funding that could have jeopardized some of the affiliations, as well as adversely affected patient care and physician recruitment. The VA Health Care Amendments of 1980 sought to remedy the perception that some affiliations were unfairly balanced in favor of the affiliate. This law required greater VA representation on the Deans Committees, improved salaries for full-time VA physicians to reduce reliance on dually appointed faculty, and mandated that VA medical center Chiefs of Staff be full-time VA employees.

In the mid-1990's, under the leadership of former VA Under Secretary for Health Kenneth Kizer, M.D., M.P.H., the VA reorganized its complement of medical centers around 22 regional systems known as Veterans Integrated Service Networks (VISNs). Under each VISN umbrella, several VA medical centers and affiliated medical schools are expected to work collaboratively to deliver health care to veterans in their region. The new structure was designed to eliminate inefficiencies and duplication of services, and to maximize the effectiveness of limited health care dollars and resources. Medical Care appropriations are allocated to the 22 VISNs based on a model called the Veterans Equitable Resource Allocation (VERA). The VERA model attempts to realign funding by allocating funds according to the number of veterans having the highest priority for health care while accounting for the inherent differences between medical centers. At the same time, VERA provides a reasonably predictable method of funding for the VISNs. Recently, the VA has begun implementing a new accounting system to account for research dollars through the VERA system and require the funds be re-invested in research rather than offset other VISN operations.

The AAMC supports the VISN reorganization; however, it has caused some strain on the VAMC medical center affiliations with medical schools. While recognizing the primary focus of the restructuring was, and should have been, the patient care mission, the AAMC expressed concerns that the education and research missions that are integral to the affiliations were not only being relegated to the bottom of the priority list, but ignored. For example, during the reorganization into the VISN structure, the VA set forth a list of 27 values on which the restructuring was to be based, but did not include cooperation and further development of the affiliations.

Certain growing pains associated with the VISN structure were inevitable given the large numbers of new individuals recruited to leadership positions from outside the VA and the rapidity and magnitude of the changes required. Rather than dealing with medical center directors who oftentimes were situated down the hall or across the street, medical school deans now must deal with VISN directors who are sometimes hundreds of miles away. Compounding these communication problems, many of the new VISN directors lacked experience in the academic environment or with the needs of the academic affiliate. I believe it is fair to say that some affiliate relationships between VISN directors and medical school deans have evolved more smoothly than others. In the past, Deans Committees were the place where all the important decision-makers were at the table and complaints could be aired. Through the Deans Committees, medical school deans and local VA leadership regularly and effectively addressed problems associated with the affiliation. While new Academic Partnership Councils (APCs) essentially replaced these committees in the new VISN structure, the APCs do not function in exactly the same way. Affiliate representation on the APCs is often at the university level and responsible for all the health professions, and the VA membership is at the facility level, rather than the VISN level, where the authority to make decisions on behalf of VA resides. These issues combine to give many deans the impression that the welfare of the affiliation is not a critical success factor for the VISN Director. Deans vary widely in their views as to how supportive VISN Directors are of the affiliations, but many feel the VISN Directors view the affiliations as something that needs to be accommodated only after all other factors are satisfied.

To maintain open communication between the VA and the AAMC, the association established the VA Deans Liaison Committee. The Committee is comprised of eight medical school deans with strong VA affiliations and meets regularly with the leadership of the Veterans Health Administration, including the Under Secretary and Deputy Under Secretary for Health, Chief Research and Development Officer and the Chief Affiliations Officer. The agendas usually cover a variety of issues that are raised by both parties and range from intellectual property concerns to service line issues. From the association's standpoint, these meetings are an essential element of the academic partnerships. At the most recent meeting in May of this year, the group discussed issues ranging from resident supervision to the accreditation of human research protection programs. While the committee is not a formal policy-making board of either the VA or the AAMC, it is a venue where both sides have traditionally been able to have their concerns heard by the other side.

Facilities issues are a major concern to both the VA and the academic affiliates. Many VA facilities were built in the rush to expand following World War II and are now, at nearly 50 years old, getting to the end of their useful life. In the late 1990's, VA began the Capital Assets Realignment for Enhanced Services (CARES) program that was designed to evaluate the capital assets - mainly facilities - in each network and to make recommendations for more efficient use of the facilities. The program began with a pilot project of the Chicago area VA medical centers and recommended closing one of the four hospitals and relocating some of the services to other hospitals. The AAMC supported the concept of reevaluating the efficiency of VA's capital assets but expressed concern that the evaluation teams did not adequately address the research and education missions. VA's second attempt at recommendations for the Chicago network was done by outside consultants and did address the research and education missions; however, little attention was given to the roles and responsibilities of the affiliated medical schools. As VA continues to expand the CARES program across the country into the remaining 21 VISNs, we would hope that the academic affiliates are included in the evaluation process.

The issue of intellectual property rights has been a contentious one in the last couple years, but one that I think can be worked out eventually to everyone's benefit. For years, the VA did not make any claims to inventions made by dually appointed employees or with VA resources. Following the Research Realignment Advisory Committee's report in 1996, VA decided to claim title and intellectual property rights to inventions made with VA resources, claiming authority to do so from an Executive Order dating back to the 1950s. Universities had long used their own technology transfer offices to patent and license these inventions under the authority of the Bayh-Dole Act. To address the new environment, approximately 40 universities have signed Cooperative Technology Administration Agreements that outline the rights of the VA, the university, and the inventor for dually appointed faculty and Without Compensation (WOC) employees with research appointments. These agreements generally outline factors such as the disclosure requirements by inventors, the split of royalty revenues, and the administrative costs. While the details of these agreements are still being hammered out, and new agreements are being signed and old agreements amended, I believe that this is an area that universities and the VA can eventually come to agreement. This is an issue that the AAMC's VA-Deans Liaison Committee was instrumental in negotiating and led to an informal discussion group held by the VA in August to put all the issues and concerns on the table.

Both the VA and academic medicine have been pushed to be more efficient, by limited appropriations and reduced managed care reimbursements, respectively. The AAMC has always been a strong advocate for increased appropriations for the VA, through the Friends of VA Medical Care and Health Research. The research program, which I have not said much about, is another important element of the affiliations. The program is a dedicated source of funding available only to faculty with full- or part-time VA appointments. Because of this, I can use the existence of the program as a recruiting tool to attract top-quality physicians. The success rates are higher than the NIH, and the pool of investigators is smaller. In addition, because the program funds primarily clinical research, results from the research are often directly applicable to the veteran population. The downsides of the program are the relatively small size of the program, $372 million in FY 2002, and the constant problem of finding dedicated time for physician investigators to conduct research as Medical Center Directors are increasingly pressured to increase the clinical responsibilities of the faculty. While the Friends of VA Medical Care and Health Research focuses its primary advocacy on behalf of the VA research program, members also support and advocate for the Independent Budget recommendation for Medical Care each year. Medical Care funding is the source that actually pays for the care provided to veterans and the salaries of the faculty. I cannot stress enough the importance of continued strong support for VA Medical Care and VA medical research.

The AAMC believes that the academic affiliations between the VA and medical schools are an important and valuable factor to both partners. As the national health care environment changes and the two partners restructure accordingly, it is essential that both parties and Congress take the affiliations into account when decisions are made regarding the realignment of facilities. Because the education and research missions of both VA and academic medicine rely so heavily on the affiliation agreements, it is essential that these missions be afforded adequate weight in the decision-making process. While affiliations were designed to improve the quality of care delivered to veterans, the partnership has also brought substantial benefit to medical schools and their broad societal missions through educational and research opportunities resulting from serving a diverse and often medically-complicated patient population. Affiliations also allow for cost-effective and efficient sharing of clinical and research resources. This presents enormous positive opportunities in the implementation of health reforms and the subsequent local planning that will occur.