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Sacrificing Veterans Health Care on the Altar of Privatization

Think creating a 'Medicare for Veterans' is the answer to VA's woes? Not so fast.
Marine Week Boston

With some seeking to further privatize veterans’ health care, and hundreds of billions of dollars at stake, sacrifices are going to have to be made. Let’s hope Ronny Jackson, Donald Trump’s nominee to be the new Veterans Affairs secretary, can ensure few of those fall on the veterans themselves.

Former VA secretary Dr. David Shulkin once held the title of least controversial Cabinet secretary in the Trump administration. He was confirmed by the Senate 100-0, and for much of his time in office quietly sought to reform veterans’ health care.

That all changed for Shulkin last month when Donald Trump replaced him with White House physician Rear Admiral Dr. Ronny Jackson. Though pushed out ostensibly over a damning ethics report, Shulkin’s story is really one of whether privatizing health care for veterans is the best way to fix a damaged institution. Shulkin’s demise is big news, which has been oversimplified in the press as just another episode in the Trump chaos narrative.

Shulkin himself has pulled no punches. “I believe differences in philosophy deserve robust debate, and solutions should be determined based on the merits of the arguments. The advocates within the administration for privatizing VA health services, however, reject this approach,” wrote Shulkin after his dismissal. “They saw me as an obstacle to privatization who had to be removed. That is because I am convinced that privatization is a political issue aimed at rewarding select people and companies with profits, even if it undermines care for veterans.”

As Undersecretary of Health in 2016 (before joining Trump Administration as VA chief) Dr. David Shulkin was still seeing patients. Veterans Health/Public domain

Despite the quick-fix appeal of privatization in the face of a VA not fully meeting the needs of its customers (Shulkin took over the VA in the wake of a report citing a “corrosive culture that has led to poor management, a history of retaliation toward employees, cumbersome and outdated technology, and a shortage of doctors, nurses and physical space to treat its patients”), is a transition towards “Medicare for veterans” really the answer?

In its simplest form, privatization means that instead of seeking care at a VA-run facility at little to no charge, veterans would be free to visit any health care provider in the private sector, with Uncle Sam picking up most or all of the tab, depending on the individual’s benefit package. The VA would thus shift away from directly providing care in its own facilities. In many cases long waits to access a VA facility would diminish, veterans in rural areas would likely have less of a travel burden, and patients could better match their needs to a provider. The latter could be especially important to LGBTQ veterans. It’s hard to argue against choice.

The issue is money. According to one report, moving vets to private providers would double spending in the immediate term. By 2034, the cost of VA health care could be as high as $450 billion, compared to a baseline of less than $100 billion. The challenge is clear: between 2002 and 2013, the number of annual VA outpatient visits nearly doubled to 86.4 million. Hospital admissions—the biggest driver of costs—rose 23 percent.

Veterans’ health care is big money and proponents of privatization want to pull as much of it as possible into the commercial sector. But where would the money come from? Major veterans’ organizations opposing additional privatization worry that disability benefits and other core VA programs such as education will be cut back. Others speculate that a privatized VA system would quickly go the way of civilian insurance, with limited networks and increased co-pays passing on costs to the patient. As happened to many under Obamacare, vets would be caught in the gap between being able to have insurance and being able to afford health care. Choice can come at a price.

The specialized needs of many veterans are part of the reason for the specialized veterans’ health care system. Despite justified criticism, the VA serves the needs of many of its patients well. In the critical area of psychology, VA performance was rated superior to the private sector by more than 30 percent. Compared to individuals in private plans, veterans with schizophrenia or major depression were more than twice as likely to receive appropriate initial medication treatment. RAND concluded separately “the quality of care provided by the VA health system generally was as good as or better than other health systems on most quality measures.”

The VA also has expertise in prosthetics, burns, polytrauma, and spinal injuries rare in civilian life. It has a lifetime relationship with its patients, leading to broader implementation of preventive care and better integration of records. These advantages could be lost under a largely privatized system, as more choice in general could result in significantly less choice at the VA in areas where it matters most.

The risk is throwing out the baby with the bathwater, as increased privatization will inevitably mean shuttering underused VA facilities. The solution lies in a system that pairs the best of privatization with a reformed government-run veterans’ health care system. Shifting some services into the private sector while retaining those unique to the VA, all to the satisfaction of Congress, demands an administrator with extraordinary bureaucratic skills. The Trump administration was very likely wrong when it decided Shulkin was not that man.

Though painted as an opponent of privatization, before he was fired Shulkin was pushing the VA to further privatize its audiology and optometry programs. He oversaw change that led to 36 percent of VA medical appointments being made in the private sector. Shulkin’s Veterans Choice Program (VCP) allowed access to private doctors where the VA couldn’t provide specialized care, when wait times exceeded standards, or when travel to a VA facility would have constituted a hardship. Shulkin was advocating for the program’s expansion when his opponents’ patience, his funding, and finally his tenure ran out.

The VCP program was consistently underfunded, in part due to the unpredictability of month-to-month expenses that will plague any privatized system. However, some of the underfunding was political: one holdout was Senator Jerry Moran. Moran wanted the program tapered off in lieu of his own bill calling for the greater leaps into privatization that Shulkin remained skeptical of.

As VA secretary, Dr. David Shulkin was an experienced medical administrator who had specialized in health care management at some of the nation’s largest hospitals. The new secretary nominee, Dr. Ronny Jackson, is a fine Navy doctor who has served two presidents, but he comes to the job with no experience managing an organization the size and complexity of the VA, the government’s second-largest agency.

Questions will be asked at what will no doubt be contentious confirmation hearings about whether Jackson can rise to the challenge, or if privatization advocates will take advantage of him to rush ahead with their own preferred changes and to their own financial gain. Hanging in the balance? Nine million veterans who rely on the VA for life-sustaining care in return for the sacrifices they have made.

Peter Van Buren, a 24-year State Department veteran, is the author of We Meant Well: How I Helped Lose the Battle for the Hearts and Minds of the Iraqi People and Hooper’s War: A Novel of WWII Japan. Follow him on Twitter @WeMeantWell.



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