VA health care system treats vets better than private facilities

Coming fresh off of featuring Kip Sullivan’s “Single Payer Health Care Financing Presentation – Three Part Series,” also “Continuing the Conversation concerning Medicare and Medicare Advantage Part 1 and Part 2.” and Kip Sullivan and Ralph Nader Talk Tradition Medicare vs Medicare Advantage; I came across this article by Suzanne Gordon concerning Veteran healthcare and its facilities. Suzanne advocates for veterans and the VA along with Phillip Longman of Open Markets Institute and the author of the “Best Care Anywhere.”

For the record, I am a Marine veteran.

The VA is woefully underfunded and has been for a while. I suspect the underfunding is purposely done so as to cause it to perform poorly. This has caused the VA issues with providing care for vets coming out of Iraq and Afghanistan.

If you do not know, one of the advantages the VA has is its own negotiated pharmaceutical formulary with has lower prices than what you would find in Medicare or commercial healthcare. There has been talk about allowing Medicare to use it. Maybe sometime soon, the commercial healthcare carpetbaggers in Congress may allow Medicare to use it also. Purposely and with the passage of the PPACA, Congress blocked any negotiation of pharmaceuticals by Medicare.

Suzanne discusses “fee for service” healthcare the same as Kip Sullivan does. There will always be a fee for service in healthcare. Under Single Payer healthcare, those fees would be set by Single Payer for healthcare. Medicare also sets fees it pays for healthcare services minus pharmaceuticals. In comparison, Commercial Healthcare Insurance typically pays ~twice (or more) than what Medicare pays and even more than what the VA costs are.

Under a false pretense, Congress has allowed veterans to use Commercial Healthcare facilities due to the under-funding by Congress causing the issues at the VA. Suzanne discusses fee for services as an issue and also discusses up-coding by commercial healthcare used by veterans. These are legitimate beefs in today’s healthcare system.

There is another issue with commercial healthcare to which veterans are being exposed to and to which commercial healthcare is salivating over . . . value-based payment healthcare. An outcome measure asking whether a given outcome occurred (is the patient’s blood pressure under 140/80?), whereas a process measure asks whether a certain process was conducted (did the doctor prescribe hypertension medication for patients with high blood pressure?).

This leads to upcoding and the resulting fees for service Suzanne is pointing too as being an issue. Medicare Advantage codes its patients yearly for the following year. CMS pays MA plans for care based upon the coding and whether used or not. Veterans over 65 using commercial healthcare rather than the VA may be exposed to upcoding if they are absorbed into the commercial healthcare system. Typically, this would be Medicare Advantage which is notorious for upcoding.

My message above lays the groundwork for what I see occurring and Suzanne’s message today in discussing the potential closing of Veteran Administration facilities.


Memo to the Veterans Affairs Secretary: Don’t Close VA Facilities, Suzanne Gordon and Russell Lemle, Washington Monthly1

On March 14, Department of Veterans Affairs Secretary Denis McDonough is expected to release a long-awaited list of VA facilities and services that may be shuttered in the coming years. McDonough’s potential hit list is required by one of the most problematic sections of the VA MISSION Act of 2018, legislation vastly expanding the outsourcing of veteran care to private-sector providers. The law mandates the creation of the Asset and Infrastructure Review (AIR) Commission, which would consider which of the VA’s health care facilities to close, improve, repurpose, or consolidate. The secretary’s list will include not only entire medical centers but also inpatient units, emergency rooms, and outpatient clinics. Critics of the AIR process worry that commission members (who have yet to be announced) will ignore a wealth of studies demonstrating that the VA delivers better outcomes at a lower cost than the private sector. They worry, too, that the VA will close facilities and programs instead of improving infrastructure, hiring needed staff, and even expanding utilization.

If there was any doubt that the VA delivers higher-quality care at a lower cost than the private sector, that concern should definitively be put to rest by a new study in the British Medical Journal2, one of the most prestigious scientific journals in the world. 

The study’s lead author is David C. Chan, professor of health policy at Stanford University and also an investigator at the VA. Chan’s coauthors includes four economists and researchers connected with Stanford University, the University of California at Berkeley, and Carnegie Mellon. Unlike many previous studies that contrasted the experiences of veterans cared for at VA facilities with non-veterans treated in the private sector, this study compared the outcomes of 583,248 veterans over the age of 65 who were enrolled in the VA health system and also covered under Medicare. When these veterans called an ambulance for a health emergency, they were randomly taken to either a VA or private-sector hospital. 

The differences were startling. Veterans treated at VA facilities were 20 percent less likely to die the following year than veterans taken to a private-sector hospital. Every one of the 140 VA hospitals in the study outperformed their private-sector counterparts. What the authors dubbed the VA’s “mortality advantage” was even greater for veterans who were African American or Hispanic. This advantage lasted months after the patients left the ER. Not only was private-sector hospital care less effective, its price tag was 21 percent higher than care at the VA.

In the typically understated fashion of medical journals, the authors advised the “nature of this mortality advantage warrants further investigation, as does its generalizability to other types of patients and care. Nonetheless, the finding is relevant to assessments of the merit of policies that encourage private healthcare alternatives for veterans.”

In other words: Stop privatizing the VA. 

It’s finally time to acknowledge what Phillip Longman of the Washington Monthly and the Open Markets Institute argued 20 years ago: The VA health care system offers the Best Care Anywhere3 and should serve as a model for all of us. 

The VA delivers such high-quality care, as Chan and his colleagues explain, for several reasons. It has a fully unified electronic medical record, and care is fully coordinated and directed by effective primary care teams. 

Rebecca Shunk, a primary care physician at the San Francisco VA Healthcare System, explains what this kind of care coordination looks like in an emergency.

When one of my patients shows up in the emergency room, our primary care patient aligned care team (PACT)—which includes a primary care physician or nurse practitioner plus a registered nurse, licensed practical nurse, and medical support assistant—is immediately alerted.

Shunk elaborates:

Whether the patient is admitted to the hospital or not, the Primary Care PACT RN will do a routine call to the veteran 48 hours after his or her ER visit to find out how they are doing and what they need. They will make sure that the veteran has a close follow-up visit with their primary care provider or a member of the team. And then, of course, we will find out if they have any other needs. For instance, do they need durable medical equipment—a walker, a cane, do they need home nursing, physical therapy? We can make all this happen quickly through our robust home care program. 

Shunk adds that the primary care team can quickly organize an appointment with a specialist like a cardiologist or a pulmonologist.

Studies show that this kind of coordination leads to the VA’s better outcomes. It’s not routine in the private sector. “In fact,” Shunk laments, “it’s hard to even get a patient’s record from a private-sector provider.”

Chan and his coauthors speculate that the VA mortality advantage may also stem from the follow-up care being determined by the patient’s need, not the private-sector provider generating revenue in a fee-for-service system. As the authors explain, VA staff members are salaried and have no incentive to overtreat. Outside of the VA, one in seven health care dollars is spent on unnecessary, sometimes toxic, and often futile treatment. 

In another paper4 published shortly after the BMJ article was published, Chan and two of his coauthors dug even deeper into the data about ER experiences at the VA and the private sector. Their analysis provides further insights into why private-sector care is more expensive and sometimes more dangerous. After an ER visit, private-sector providers are more apt to transfer patients to inpatient rather than outpatient care and keep them in the hospital longer:

The authors note;

“Services with high reimbursement (under fee-for-service arrangements) are more likely to be performed in non-VA hospitals.”

As the VA Office of Inspector General has reported5, thousands of private-sector providers under the MISSION Act’s Community Care Network have engaged in the notorious practice of “upcoding” when they bill the VA for services. To generate more revenue, they may bill for complex evaluation and management services they have not performed. The same seems to be true when billing during and following an emergency. As the authors write,

The odds of reporting high vs. low-complexity services are more than five times higher in private hospitals vs. the VA.

The VA, on the other hand, increases the delivery of less remunerative outpatient and rehabilitation services. The authors add that the kind of rigorous telephone follow-up Shunk describes above “are only reported at the VA.”

The authors conclude, 

Widely publicized concerns about the quality and capacity of the VA system, the largest public healthcare delivery system in the US, have fueled public perceptions that the VA health system is falling short of providing good care to the many veterans who depend on it. Our findings join those from other studies in suggesting that, for the system overall, those perceptions do not match reality. This conclusion has important implications for health policy. Enabling or encouraging veterans to obtain care outside the VA system could lead to worse, not better, health outcomes, particularly for veterans with established care relationships at VA facilities.

Tragically, documents leaked to the Washington Monthly indicate that the VA secretary has ignored long-standing evidence of the VA’s cost and quality advantage. In turn, the VA recommends closing inpatient units and even some emergency departments across the country. Since a hospital can’t have an emergency room without an inpatient unit, this would mean shuttering even more ERs than any slated for closure. With the VA secretary and his consultants, many of them holdovers from the Trump administration, seemingly determined to ignore the scientific evidence. We hope Congress and the AIR Commission will reject the recommendations. The coronavirus pandemic has led to many hospital closures and dangerous understaffing in the non-VA health care system. It is more important than ever to not just preserve existing VA capacity but possibly to even expand it.

1Memo to the Veterans Affairs Secretary: Don’t Close VA Facilities | Washington Monthly,

2Mortality among US veterans after emergency visits to Veterans Affairs and other hospitals: retrospective cohort study | The BMJ

3Best Care Anywhere: Why VA Health Care Is Better Than Yours |, Phillip Longman, February 2011

4Is There a VA Advantage? Evidence from Dually Eligible Veterans | NBER

5VHA Risks Overpaying Community Care Providers for Evaluation and Management Services

Blog – Suzanne Gordon (

Longman – Open Markets Institute