A bill to reform the department, which passed the Senate in a nearly unanimous vote last week, would allow veterans facing long wait times at VA facilities to seek out care from private local doctors instead. However, it would also more than double the VA’s annual healthcare spending:
The analysis from the Committee for a Responsible Federal Budget suggests that providing VA-reimbursed private care to veterans, without setting budgetary caps and oversight, could explode the VA’s health-care budget with an additional $500 billion in spending over the next 10 years. … That’s more expensive than the entirety of Medicare Part D, which funds prescription drugs for seniors.
Patrick Brennan pans the reform as expensive and unnecessary:
The VA scandals demand an immediate response, of course, but the Senate bill isn’t necessary to execute it: President Obama has already ordered that the VA expand the coverage it offers outside the system for vets waiting for care. No program like this should be passed as an emergency measure.
Fixing the VA’s problems, such as they are, may require lots and lots of money — and maybe the Senate wasn’t voting to spend quite as much money as the CBO just said. But any congressman with any respect whatsoever for the concept of fiscal responsibility — not deficit hawks, just anyone concerned with how much we spend and on what — should want Congress to take time to study this issue (as, indeed, the House is planning to).
Danny Vinik calls it a “Trojan horse” for privatization:
The reason that clinics and hospitals—at both VA and non-VA facilities—have such long wait-times is a shortage of primary care doctors. This shortage has happened for a number of reasons: Medical students face financial incentives to choose a specialty field instead of becoming a primary care doctor. State occupational licensing laws prevent nurse practitioners from performing many straightforward medical tasks. Medical schools receive billions in federal funding with little oversight for how may primary care doctors they produce. The bills’ partial privatization scheme does nothing to ease these problems.
But Kevin Drum sees it as an opportunity to finally resolve the question of whether privatization actually works or not:
Maybe this is a good thing. Better access to health care means more people will sign up for health care, and they’ll do it via private providers. That’s the basic idea behind Obamacare, after all.
Of course, it’s also possible that this might be a bad thing. As Phil Longman points out, outsourced care lacks the very thing that makes VA care so effective: “an integrated, evidence-based, health care delivery system platform that is aligned with the interests of its patients.” …
So which is it? Beats me. That’s why I sure hope someone is authorizing some money to study this from the start. It’s a great opportunity to compare public and private health care on metrics of both quality and cost. It’s not a perfect RCT, but it’s fairly close, since the people who qualify for private care are a fairly random subsegment of the entire VA population. If we study their outcomes over the next few years, we could learn a lot.
Michael Cannon and Christopher Preble would prefer to do away with the separate VA health system entirely:
We propose a system of veterans’ benefits that would be funded by Congress in advance. It would allow veterans to purchase life, disability and health insurance from private insurers. Those policies would cover losses related to their term of service, and would pay benefits when they left active duty through the remainder of their lives. To cover the cost, military personnel would receive additional pay sufficient to purchase a statutorily defined package of benefits at actuarially fair rates. The precise amount would be determined with reference to premiums quoted by competing insurers, and would vary with the risks posed by particular military jobs.
Insurers and providers would be more responsive because veterans could fire them — something they cannot do to the Department of Veterans Affairs. Veterans’ insurance premiums would also reveal, and enable recruits and active-duty personnel to compare, the risks posed by various military jobs and career paths. Most important, under this system, when a military conflict increases the risk to life and limb, insurers would adjust veterans’ insurance premiums upward, and Congress would have to increase military pay immediately to enable military personnel to cover those added costs.
The Dish 