POLICY: In Defense of the VA System

Like fellow contributor Eric Novack, THCB alum Maggie Mahar has been following the Walter Reed story closely.  Maggie doesn’t buy the criticism that the problems at the facility are due to the fact that Walter Reed is a government run hospital. She’s  also unhappy about the fact that critics are using the occasion to target the VA system in general. Maggie is the author of the critically acclaimed “Money Driven Medicine: The Real Reason Health Care Costs so Much.”

Too many news reports about the scandal at Walter Reed use the story to malign the VA hospital system–and to suggest that when government gets involved in health care, the result is disaster.

First, Walter Reed is not part of the Veterans Administration Health Care System. It is a U.S. Army Medical Center.Secondly, while not every VA hospital is perfect, overall,  the VA is one of the very best  health care systems in the U.S.–thanks to a major overhaul by undersecretary of health Kenneth Kizer in the 1990s. Its electronic medical system has done an extraordinary job of co-ordinating care and all but eliminating medication errors.

As Business Week reported last year (July 17th, 2006) , “if you want to be sure of top-notch care, join the military. The 154 hospitals and 875 clinics run by the Veterans Affairs Dept. have been ranked best-in-class by a number of independent groups on a broad range of measures, from chronic care to heart disease treatments to the percentage of members who receive flu shots. It offers all the same services, and sometimes more, than private sector providers.”

A string of studies published in published in medical jouranls back up these claims.  For  the full story of the VA’s transformation. see Philip Longman’s “The Best Care Anywhere” in Washington Monthly, January 2007.

That said, the Bush administration has steadily cut funding for the VA hospital system, and as a result, access and waiting times have suffered. By 2005 the number of patients the Veterans Administration was treating had doubled over 10 years to roughly 7 million. Meanwhile, the VA had cut costs by half. Such efficiency is admirable– but at that  point, the budget was too tight.

And that was 2005. As the war in Iraq dragged on, the number of wounded multiplied.

Yet just as this administration failed to provide fighting soliders with the armor they needed, it has failed to give the VA the resources it needed to keep up with the carnage.

24 replies »

  1. On 19 November 1967 I was sitting on Hill 875 at the Command post when a US. aircraft dropped a bomb and it tree burst above us. The VFW magazine, (Mar 2006)called it The “worst friendly fire incident in Vietnam. I was NEVER EXAMINED OR TREATED for TBI. Now Im having problems and the VA doesnt seem to be able to hear me when I tell them that. Who’s ass do I have to kiss to get treatment for TBI?

  2. I believe that all the discussion on budgets, who was president and what they did is irrelivant. The VA system has some excellent physicians and programs. I am a service connected disabled vet. In the past 5 years I have had several experiences which I believe the quality of care was less than acceptable. I first had an “unusual” chest xray in November of 2004 by the time they did the biopsy in 2006 it had progressed to stage IIB. After having a lung removed the care I received in ICU was poor. In my opinion the care given in the hospitals by the direct care staff was marginal at best.
    I went through channels and lodged complaints which were never addressed.
    When I moved from on city to another it took me six months to get an appointment with the prime care clinic.
    Today I was at a va clinic and saw three veterans who needed diabetic medication told to drive 65 miles to an urgent care facility if they “can’t” wait and if not wait until next week for an appointment.
    Maggie Mahr can expound about the great VA care. She is not the one being treated.

  3. Steven- thanks for the information… as you know, the issue is not one of taking care of true emergencies– though community physicians certainly notice insurance statuts, it does not change how I treat patients, at least.
    I also cannot argue that the VA formulary is, in and of itself, bad. I would say that today’s Medicare beneficiaries would be in for a rude awakening if tomorrow it was announced that their formulary now mirrored the VA system.
    As a matter of policy, of course, it does not reflect particularly well on our government bureaucracy that our nation’s veterans can find themselves ‘uninsured’ if they happen to fall off of their bicycle or quad close to a community hospital.
    Finally, thanks for the information about the Chief of Staff authorization power in LA. I will look into it here in Phoenix and post about it separately.

  4. Steven- thanks for the information… as you know, the issue is not one of taking care of true emergencies– though community physicians certainly notice insurance statuts, it does not change how I treat patients, at least.
    I also cannot argue that the VA formulary is, in and of itself, bad. I would say that today’s Medicare beneficiaries would be in for a rude awakening if tomorrow it was announced that their formulary now mirrored the VA system.
    As a matter of policy, of course, it does not reflect particularly well on our government bureaucracy that our nation’s veterans can find themselves ‘uninsured’ if they happen to fall off of their bicycle or quad close to a community hospital.
    Finally, thanks for the information about the Chief of Staff authorization power in LA. I will look into it here in Phoenix and post about it separately.

  5. I am an orthopaedic surgeon who works at the Veterans Administration in Los Angeles. I thought I would clarify an earlier point of contention about emergency care. When I inquired about this I discovered that our Chief of Staff is permitted to authorize care at an outside Emergency Room. I assume this is the case at other VA hospitals, so Eric Novack may wish to seek authorization for emergent care he provides to veterans in the future.
    For what it’s worth I think our formulary improves medical care. Medications are reviewed by physicians and pharmacists on the basis of scientific and medical evidence before being added to or subtracted from the formulary. The formulary process allows one to request off-formulary medications when medically indicated, and I have found that after providing medical justification these requests have been granted for my patients in those rare circumstances when that process was required.
    Because most VA hospitals are associated with teaching programs, patients are frequently cared for by resident physicians under the supervision of faculty physicians.(so there are large numbers of newbies, but large numbers of well-trained academic physicians as well).
    It has been my impression from a clinical point of view that our budget for the health care component of the VA continues to fall short of what would be optimal.

  6. Maggie- nothing ad hominem intended. While we agree that funding increases have been insufficient, I continue to stand by my claim (and you appear to be agreeing) that the funding levels for the VA are far higher today than in the last year before this administration.
    In your original post, you did not claim that funding increases have not kept up with demand and/or inflation— what you DID write was “the Bush administration has steadily cut funding for the VA hospital system”– I maintain that statement is false.

  7. Eric–
    I do not twist numbers and I did not mistate the facts.
    I provided numbers on growth in insurance premmiums to show how the cost of care has skyrocketed in the private sector–while the growth in VA funding falls far below that level.
    If you would prefer numbers on total health care spending- and think they they would proove your point–why not look them up yourself? (Rather than making ad hominem attacks).
    Perhaps you didn’t look them up because you knew that they would not proove your point: In 2006, total spending on healthcare in the U.S. exceeded $2 trillion–up from $1.3 trillion in 2000. That’s more than a 50% increase in cost of of care –and meanwhile the VA was caring for over 30% more patients in 2006 (5 milion –up from less than 4 million in 2000.) These are the number of veterans actually using the VA system for health care according to the CBO.
    Thus the 50% increase in fudning from 2000 to 2006 was far from sufficient.
    Meanwhile, many more vets would be using the VA if it were not for the fact that, as of 2003 (on Bush’s watch), the VA no longer offers healthcare to all vets. Only those who earn less than $25,000 a year, and/or those whose condition is related to their medical service qualify, leaving roughly 1.7 million Vets uninsured. (Before leaving office, President Clinton had signed a bill that made VA care available to all veterans.)
    Many of these uninsured Vets served in Vietnam, the Gulf War, Afghanistan or Iraq. Most are employed, but in many cases, either their employer doesn’t offer health insurance or they can’t afford it. (With annual premiums averaging well over $4000 for an individual, and more than $12,000for a family, it’s easy to see how a Vet earning $25,000—before taxes—has a hard time paying for health insurance.)

  8. Eric, I’ve known for 25 years doctors who teach at the VA, and I may have mistakenly believed that they were not teaching well-seasoned physicians. 🙂
    The VA and Medical Colleges are where physicians are taught, and it makes sense to me that they therefore have a higher ratio of newbies compared to the average hospital. Silly me.

  9. Maggie– the use of health insurance premium increases is not the usual way that health spending increases is measured. So, while the cost of health insurance has increased, you are twisting your stats to backtrack from your mis-statement.
    Jack- show me a shred of evidence that tha VA physicians are primarily ‘newbies’. Many VA Med Centers are part of teaching programs, where docs are newer, but the faculty run the range of experience.
    Barry- while it sounds great to just exclude drugs for being similar, real people can and do react differently to medications.

  10. When I was a kid just getting started in the World of Big Business, a man who was sort of a mentor gave me a book called “The Official Rules”. Awhile later, a sequel came along called “The Official Explanations”. I don’t remember which book its from, but there was The Rule of 1,000 which says something like “once an organization has 1,000 members, it can generate so much work internally that it no longer needs contact with the outside world.” This sounds like an explanation for for a lot of things, so its probably from the sequel. Anyway, we can see that big healthcare organizations suffer from it.
    With respect to evil contractors: it takes much greater management skill to oursource your work than it takes to do it in house. Outsourcing makes management shortcomings glaringly obvious. If the contractors are not performing, the fault lies primarily with the people who let the contract. Next time, write a better one, and have the (meaningful) metrics in place to make sure you’re getting what you’re paying for.

  11. We need to be careful to differentitate between the Active Service Hospitals and the Veteran’s Administration. There are major differences.
    I am currently a resident in a Veteran’s Home after having undergone treatment through the VA for PTSD and Depression, long overdue some 40 years after the Tet Offensive that cap stoned my military 2nd tour in Vietnam with a lifetime of illness.
    My blog has attracted the stories of many veterans such as myself and other sufferers from PTSD who were victimized by elements of society other than the VA system of medical and mental treatment. I, for one, became trapped in the Military Industrial Complex for 36 years working on weapons systems that are saving lives today but with such high security clearances that I dared not get treated for fear of losing my career:
    When my disorders became life threatening I was entered into the VA System for treatment in Minneapolis. It saved my life and I am now in complete recovery and functioning as a volunteer for SCORE, as well as authoring books and blogging the world.
    When I was in the VA system I was amazed at how well it functioned and how state of the art it is for its massive mission. Below is a feature article from Time Magazine which does a good job of explaining why it is a class act:
    I had state of the art medical and mental care, met some of the most dedicated professionals I have ever seen and was cared for by a handful of very special nurses among the 60,000 + nursing population that make up that mammoth system. While I was resident at the VA Hospital in Minneapolis I observed many returnees from Iraq getting excellent care.
    I do not say the VA system is perfect but it is certainly being run better on a $39B budget than the Pentagon is running on $494B.
    We have bought into the Military Industrial Complex (MIC). If you would like to read this happens please see:
    Through a combination of public apathy and threats by the MIC we have let the SYSTEM get too large. It is now a SYSTEMIC problem and the SYSTEM is out of control. Government and industry are merging and that is very dangerous.
    There is no conspiracy. The SYSTEM has gotten so big that those who make it up and run it day to day in industry and government simply are perpetuating their existance.
    The politicians rely on them for details and recommendations because they cannot possibly grasp the nuances of the environment and the BIG SYSTEM.
    So, the system has to go bust and then be re-scaled, fixed and re-designed to run efficiently and prudently, just like any other big machine that runs poorly or becomes obsolete or dangerous.
    This situation will right itself through trauma. I see a government ENRON on the horizon, with an associated house cleaning.
    The next president will come and go along with his appointees and politicos. The event to watch is the collapse of the MIC.
    For more details see:

  12. Maggie,
    I agree that there is plenty of room for improvement in comparing the efficacy and cost-effectiveness of similar drugs vs each other as opposed to against a placebo. Less effective drugs could be placed in the highest co-pay tier which would drive down utilization, other things equal. Moreover, I note that United HealthGroup will no longer pay for Nexium because Prilosec and the generic equivalent is just about is good and much cheaper. There is no reason why other drugs that stack up as poorly in terms of value for money vs alternatives could not also be excluded from drug formularies. I certainly don’t think a single payer or one size fits all system is the only way to accomplish this.

  13. Barry–
    The fact that the VA formulary is smaller may well just mean that it is more selective. The VA uses its electornic data-base–showing how patients repond to different medications–to picks the drugs that it includes in its formulary.
    One striking fact: the VA, the Mayo Clnic and Kaiser all stopped using Vioxx about two years before Merck was forced to take it off the makret. They all felt that it was over-priced, and no better than less expensive, older drugs. Also, the medical literature showed the possiblity of real risks.
    Private sector insurers continued to include Vioxx in their formularies, not because they were entirely unaware of the medical literature or the fact that it had been hyped, but beause they feared that customers would switch to other plans if they didn’t cover Vioxx. So they felt forced to keep in in a formulary that is based on giving the customer what he thinks he wants (after he has seen the ads) rather than what he needs (based on clnical evidence) .

  14. Following is a post I made on another thread because it fits this discussion:
    “Of course the current VA model is not perfect, because it must compete with a private market in which physicians can make well over $500K if they are creative. Thus the VA gets the newbies and they aren’t always the best.
    But that doesn’t destroy the model. If all we had was a VA system with all of todays physicians folded into it and paid a progressive P4P salary, it would be a hell of a lot better than the current free-market system that is on the verge of being taken over by the CEOs.”

  15. Maggie,
    Thanks for the excellent summary and for doing the research.
    I am impressed that your brother-in-law would opt for VA care, at least some of the time, given the private sector resources available in Manhattan. The VA drug formulary, however, is highly restrictive (1,300 drugs or so, I believe). That is about one-third of the number on most formularies available to Medicare Part D patients. It is questionable how satisfied Medicare patients would be if the tradeoff for government price negotiation with drug companies to get lower prices for seniors would be a formulary as restrictive as the VA’s.

  16. Barry–
    That’s a good question.
    I did a little research and it turns out that the number of veterans coming into the VA health care system has been rising by about 5 percent a year as the number of people returning from Iraq with illnesses or injuries keeps rising.
    Iraq and Afghanistan war veterans represent almost 5 percent of the VA’s patient caseload, and many are returning from battle with serious injuries requiring costly care, such as traumatic brain injuries. This is in part because we have gotten so much better at keeping wounded soliders alive on the field–and getting them home.
    In total the VA expects to treat about 5.8 million patients next year, including 263,000 veterans from Iraq and Afghanistan.
    Even though vets from WWII and Korea are dying off, thanks to medical advances, Korean vets are living much longer than one might expect. But as they age, they need a lot of care. Like most older Americans, many suffer from long-term chronic diseases like cancer, congestive heart failure or diabetes. In the past, people used to just drop dead in their sixties, but that’s no longer the case. One out of seven Americans die of one of these chronic diseases.
    Finally, although Vietnam vets are becoming eligible for Medicare, many will choose to use the VA system–as my brother-in-law does. Although we live in Manhattan, surrounded by private-sector doctors who take Medicare, he has, in many cases, found better care at the VA.
    You’re right that the Bush administration has made many Vietnam vets ineligible for VA care–because they earn too much and/or because their problems are not related to active duty. But insofar as they are eligibloe, more and more Vietnam vets are choosingthe VA because the care there has gotten so much better and because the cost of drugs is significantly lower. (Unlike Medicare, the VA is allowed to use its clout to negotiate with drug-makers for lower prices, and it has been very successful.)

  17. Maggie,
    While the Viet Nam vets are, indeed, aging (I’m one of them), many of us will start to become eligible for Medicare in a few years. Also, lots of us don’t qualify for VA care because we make too much money and don’t have any service connected medical issues (though we do have non-service connected medical issues). Moreover, World War II and Korean War vets are rapidly dying off. At one time there were more than 13 million World War II vets, and that number must be well below 4 million by now. That should at least mitigate some of the pressure on the VA budget and healthcare system, no? For perspective, can you provide some data indicating how many veterans there are today and how many of those are actually cared for by the VA healthcare system as evidenced by an active EMR in their system?

  18. Eric–
    Thanks, as always, for your compliments on my writing.
    Now, let’s look at the numbers.
    The fact that Bush’s VA health care budget in 2006 was 50% higher than Clinton’s in 2000 is hardly surprising.
    Thanks to inflation in the cost of everything from medical devices to hospital stays, employment-based [private sector] health insurance premiums increased 87 percent during the same period.
    In others words the VA budget hasn’t kept up with healthcare inflation. Meanwhile, Vietnam Vets continued to age while the number of wounded Vets coming home from Iraq spiraled.
    What is important is not the total budget for veterans healthcare, but how much the administration budgeted per Vet.

  19. david- thanks for the clarification… but ‘life-threatening’ does not apply to the several Vets I have treated for non-life-threatening injuries (fractures) over the past year who are left out in the cold by the current system.
    If you can find out if the benefits can be applied to significant, but non-life-threatening injuries let me know. Also, I will let the local hospital know, as they tell me that 9 times out of 10 they do not collect anything from the VA.
    But certainly, facts are the only good way to have the conversation.

  20. Clarification on VA ‘out-of-network’ benefits–For many years there has been exceptions that allowed the VA to pay for life-threatening emergency care for veterans with rated disabilities linked to their military service. For the past five years, this benefit has extended to the so-called non-service connected veterans suffering an emergency who had no other insurance or coverage (see USC Code 1725). I can tell you from first hand experience that for the large urban VA medical center in which I worked this translated into millions of dollars paid out to local hospitals. We’re better off discussing this factually.

  21. Hear, hear to Lynn, for injecting a rational comment into the discussion. I am always amazed how people get sidetracked from the real issues onto their favorite soapbox. Let’s put our energies into making sure these guys get help, not using them as pawns for the political argument du jour.

  22. Bureaucracies are bureaucracies whether public (gov’t) or private (large for profit hospital companies). Medical care whether delivered by Captains and Majors or civilian physicians and nurses is complex with many opportunities to drop the ball either causing mild inconvenience at best or unintential pain and suffering or death at worst.
    The DOD and VA aren’t immune from systemic failures. What is disturbing is that this was not anticipated. That is simply another example of the FAILURE of Leadership. We did this to the wounded after Viet Nam and again after Gulf War I.
    The difference I see in Iraq and Afganistan is that battle field medicine has progressed far faster and better than the DOD’s and VA’s post acute and rehab care. Wounded soldiers now live, where before they would have died. But in order to return to their optimal potential post discharge they were promised and deserve better and more humane care (and timely disability determination and compensation). This is especially true for the psychologically damaged and those with traumatic brain injury, the signature injury of Iraq!
    These are issues of both quantity of care and caregivers and the quality of care and caregivers. That’s what we should be addressing and fixing.
    This situation will be corrected when our President is routinely willing (and able) to have his photo ops with TBI soldiers who will remain permanently disabled trapped in wheel chairs and drooling. It’s not the picture of the consequences of the Global War on Terrorism the Administration wants Americans to see.
    Those who don’t learn the lessons of history are doomed to repeat them. When will we every learn. We should all be ashamed.
    Lynn Bailey
    Health Economist
    Columbia, SC

  23. And, Eric, what were the figures for the previous Bush years? 2001? 2002? 2003? 2004? 2005? Where they, perchance, greater than 2006?
    And I hate to break it to you, but Clinton isn’t president anymore, so you don’t have him to blame everything on. No one is Bush-bashing, unless you happen to believe that the truth somehow hates America. This travesty happened on Bush’s watch, whether the money is greater or less. It is obvious that this bureaucracy was given conflicting instructions: Take care of our wounded, but make sure you help as few people as you can.
    Kindly return now to your alter-to-Rove and re-pray for instructions.

  24. Maggie- I appreciate your well written opinion, but there are some factual errors, and omissions:
    1. VA budget for 2000 (Clinton proposed)=$48 billion (http://www1.va.gov/pressrel/00budget.htm)
    2. VA budget for 2006 (Bush proposed)=$70.8 billion (http://www1.va.gov/opa/pressrel/pressrelease.cfm?id=941)
    That is nearly a 50% increase, not the “Bush administration has steadily cut funding for the VA hospital system” as you claim.
    If you want to say that funding has not increased enough, perhaps we might find an area of agreement, but claiming a funding decrease is patently untrue.
    3. VA patients have zero (0) ‘out of network’ benefits– when a VA patient shows up at an emergency room other than at a VA, they are classified as ‘self pay’. The VA will almost never cover any expenses for the emergent care. This is not a ‘Bush’ problem or a Republican or Democrat problem– it is a failure of government. This policy has been around since long before the Republicans took over. It is unlikely you would classify a private insurance plan that penalized its members who had emergencies and go to other hospitals as being ‘top-notch’.
    4. please show me evidence that the VA efforts have been successful in “all but eliminating medication errors.” Clearly, CPOE systems can improve things greatly, but, as I have noted before, it is not the panacea.
    5. If we accept the quality claims as true, then the Washington Monthly article you cite does not support your claims of Republican malfeasance– rather that President Clinton responded in 1996 in response to a bill passed by a Republican Congress and supported by Republican presidential candidate Bob Dole.
    While we differ greatly on the means to achieve health care reform, and what will work, Bush-bashing undercuts your arguments, rather than enhancing them.