Sometimes I wonder how serious we are about reducing healthcare costs in this country. I hear the clamor to reduce costs and bring ever-greater efficiencies to healthcare delivery. As the great debate over Medicare and Medicaid spending drags on, maybe we need to pause and consider doing something that can strike terror in the hearts of even the most grizzled politicians. I'm talking about taking a closer look at the antiquated and bureaucratic Veterans Health Administration. As a veteran of the Korean War and a dues-paying member of the American Legion, I believe the time has come to make some changes.
Peter Kilborn of the New York Times recently did a thorough job of dissecting the complexities of the Department of Veterans Affairs healthcare system. Comprising 173 hospitals and 500 clinics, nursing homes and other facilities-not to mention 20 golf courses-it's the largest health system in the nation. However, one-fourth of the VA hospital beds are empty. That's because the veteran population is shrinking as World War II veterans reach their 70s and 80s. Nevertheless, President Clinton has proposed an increase of $700 million for the VA health system, and Congress has proposed a $400 million hike.
It's no secret the private healthcare sector is shrinking. There are fewer hospitals today as the shift toward outpatient services continues. But that's not the case with the VA system. For instance, the Times article notes that the department's annual report for 1994 shows only a 17% increase in outpatient visits from 1987 to 1994. That compares with a 50% increase over the same period in the private sector. Part of this can be explained by goofy VA regulations that make it mandatory for hospital stays for some procedures, including cataract operations, that are routinely performed at outpatient clinics in the private sector. Kenneth Kizer, M.D., VA undersecretary of health, gives an example: "A patient comes in with a broken ankle. It is casted in the emergency department. He needs crutches. Well, crutches are called a prosthetic device. Prosthetic devices are only given on an inpatient basis. So he has to be admitted to the hospital. Every place else in the world just gives him a set of crutches and lets him go home."
All veterans are eligible to use VA hospitals, but less than 10% do. Those who do are mostly veterans who get all expenses paid. To qualify for free care, a veteran must earn less than $20,469 or be declared 50% disabled by injuries or diseases contracted in the military. The system cares for about 2.6 million veterans and will receive about $16.6 billion in funding for fiscal 1996. The Times, quoting a Senate aide, contends the Defense Department will spend half as much on the care of 8 million military beneficiaries and dependents. While aging veterans obviously require more intensive care, that still doesn't explain all the cost disparity.
Richard Cogan, a senior fellow at the Center on Budget and Priorities in Washington, puts it bluntly: "The real question is whether there should be a veterans healthcare system at all." Why the duplication when there are so many hospitals in the private sector that could accommodate the needs of veterans? Rep. Bob Stump of Arizona, a Republican and chairman of the House Veterans Affairs Committee, makes it clear in the article that closing VA hospitals is a political nightmare. "You're talking about something that would be worse than base closings. We're going to try letting some guys go into any hospital and see what happens," Stump said.
Kizer already is working in that direction. He's reorganizing hospitals and linking them into regional groups. He's also eliminating duplication and making outpatient care a top priority. But he needs Congress' help.
No one questions the need for our veterans to receive the best medical care available. They deserve it. But if government is really serious about reforming healthcare, the VA system cannot be immune to change. Sure, change is tough, but so is a bloated, ineffective bureaucracy.
The time has come,
Charles S. Lauer