improved health care services to more veterans, some propose to
expand the size and scope of the Veterans Affairs (VA) medical
system beyond its current population and capacity. The core mission
of the VA is "to serve current combat veterans and veterans with
service disabilities, lower-incomes, and special needs."
Efforts to broaden this mission to include nearly all veterans are
unwise. Rather than expand the VA's role, policymakers should
consider alternatives that would preserve the core mission of the
VA medical system while providing more meaningful assistance to
others who have served the United States.
The VA's Unique
and Medicaid, which reimburse private providers, the VA medical
system is owned and operated by the VA. The VA builds its own
hospitals and facilities and hires its own physicians and ancillary
health care providers as employees. The VA does have some
advantages. For example, the VA has a long tradition of training
medical students and recently has implemented a state-of-the-art
information technology (IT) system to improve patient care.
The VA currently
receives its funding at Congress's discretion. Because these funds
are limited, Congress required that the VA categorize each veteran
into one of seven classes, from the highest priority (Priority 1)
to lowest (Priority 7).
In 2002, Congress created Priority 8, separating higher-income
veterans suffering from conditions not related to their service
from Priority 7, thus, reserving Priority 7 for lower-income
veterans suffering from such conditions.
In 2003, the Bush Administration suspended new enrollment of
Priority 8 veterans so that the VA could focus on those veterans
most in need.
As with any
government-run health care program, the VA's greatest difficulty is
balancing cost and demand. Health care costs have been rising
across the economy, and the VA program is no exception. In 2001,
the VA spent $21 billion on medical care for veterans.
In 2004, this spending reached $27 billion, and it is expected to
reach $30 billon by 2007.
Between 2001 and 2004, the number of patients treated in the VA
system increased 22 percent from 4 million in 2001 to 5 million.
Of the veterans currently enrolled in the VA, only 27 percent are
in the lower-priority categories.
While the VA
provides high-quality care to the veterans that it serves, forcing
the VA to spread its limited resources across a broader, more
diverse population could put the quality of care for the most needy
and deserving at risk. The VA is known for its specialized
treatments and for dealing with difficult and complex health
conditions. Expanding its services to meet the basic health care
needs of the broader veteran population could cause general health
services to crowd out more specialized treatment within the
large pool of new beneficiaries with less-specialized medical needs
into the system would alter the political and budget calculus of
the VA system. Because beneficiaries with general needs would
substantially outnumber beneficiaries with specialized needs,
future attempts to control cost growth would likely restrict access
to specialized care.
The experience of
Medicaid, the government healthcare program for the poor,
demonstrates the danger of expanding a healthcare program beyond
its original purpose. The more Medicaid eligibility expands up the
income scale, the more cost-containment measures are imposed to
keep expenditures under control. However, many of these techniques
actually put patients at greater risk. For example, limitations on
prescription drug access in Medicaid have had significant adverse
affects on some of the most vulnerable populations, such as the
mentally disabled. In the VA system, the most vulnerable would be
those veterans injured in service to their country.
recognize that two separate issues are at play in this debate. The
first is whether additional health care benefits should be provided
to all veterans, and the second is how such additional benefits
might be provided. If Congress does decide to expand benefits to
non-service-related conditions and lower-priority veterans, then it
should consider alternatives to expanding the existing VA medical
Congress could authorize and fund health insurance subsidies for
certain lower-priority categories of veterans that would assist
them in purchasing private health insurance coverage and related
medical services. Because these veterans suffer from conditions
that are indistinguishable from those suffered in the general
population, the same arrangements that cover the general population
are well designed to cover them. A subsidy program would allow the
VA to continue to focus on those who are in most need while
providing some assistance to more of those who served their
Two advantages of
this approach are particularly important. First, subsidies would
ensure continuity of coverage and care for the vast majority of
veterans in the lower-priority categories who already have
insurance coverage and relationships with hospitals and doctors.
Second, it would avoid the substantial capital expenditures
necessary to expand the current VA system to accommodate more
In terms of both
total cost and quality of care for all veterans, expanding the VA
medical system is not the best way to provide improved health care
services to those veterans now outside of the system. Subsidies to
purchase private insurance plans would serve these veterans better
and protect the care that those who were injured in service to
their country depend upon.
Owcharenko is Senior Policy Analyst in the Center for Health
Policy Studies at The Heritage Foundation.