Medicare is allowing some beneficiaries to receive care at Department of Veterans Affairs healthcare facilities yet is keeping the money, VA officials said last week.
Consequently, the VA is backing a demonstration project under which Medicare would start paying VA facilities for treating Medicare-eligible vets (See story below).
Although VA officials didn't say the shifting of costs by the Medicare program to the VA was intentional, they raised concerns that the federal government is paying twice for care.
"We've been concerned that there's been some cost-shifting from Medicare+ Choice plans to VA," Kenneth Kizer, M.D., VA Health Undersecretary, told a Senate Finance Committee hearing last week. "We are not able to get reimbursement for that."
Susan Pisano, a spokeswoman for the American Association of Health Plans, acknowledged that Medicare+Choice enrollees may be receiving Medicare-covered services at VA facilities, but said the answer to the problem may lie in better beneficiary education.
"To the extent that this is an issue, we think the solution is to work with beneficiaries so they know what their benefits are," Pisano said.
The VA bases its argument on a joint study between its outcomes group at the VA hospital in White River Junction, Vt., and the Dartmouth University Center for Evaluative Clinical Sciences.
Between 1992 and 1996, the study found that the percentage of veterans enrolled in Medicare managed-care plans rose to 10.2% from 3.5%, paralleling trends in the nonveteran community, said Gregg Pane, M.D., VA's chief of policy and planning.
In 1996, the total VA cost for patients also enrolled in a Medicare HMO was $3,100, or about $146 million in a system that had a $16.6 billion budget. That per-patient figure was 45% less than the VA's overall per-patient cost of $5,547, but Pane said those are costs the VA should not have incurred because Medicare had already paid to cover those patients in a managed-care plan.
He said the study didn't attempt to identify the reasons why veterans sought care at the VA for treatment that was covered by their Medicare managed-care plans.