Sorry, But the VA Isn't a Model Health Care System for the Rest of the Country


How much can we learn about how to manage American health care policy from the Veterans Health Administration? According to known cat-person Paul Krugman, a lot—it's just that most people, Republicans especially, are too dim to realize it.

Republicans reflexively hate the VA, he writes, for no good reason at all: "It's literally a fundamental article of faith in the G.O.P. that the private sector is always better than the government, and no amount of evidence can shake that credo."

But what too few people know, Krugman insists, is that "the V.H.A. is a huge policy success story, which offers important lessons for future health reform." Here's his case

Many people still have an image of veterans' health care based on the terrible state of the system two decades ago. Under the Clinton administration, however, the V.H.A. was overhauled, and achieved a remarkable combination of rising quality and successful cost control. Multiple surveys have found the V.H.A. providing better care than most Americans receive, even as the agency has held cost increases well below those facing Medicare and private insurers. Furthermore, the V.H.A. has led the way in cost-saving innovation, especially the use of electronic medical records.

What's behind this success? Crucially, the V.H.A. is an integrated system, which provides health care as well as paying for it. So it's free from the perverse incentives created when doctors and hospitals profit from expensive tests and procedures, whether or not those procedures actually make medical sense. And because V.H.A. patients are in it for the long term, the agency has a stronger incentive to invest in prevention than private insurers, many of whose customers move on after a few years.

And yes, this is "socialized medicine" — although some private systems, like Kaiser Permanente, share many of the V.H.A.'s virtues. But it works — and suggests what it will take to solve the troubles of U.S. health care more broadly.

It's true that the VA was significantly reformed in 1995, and reviews of the system have been noticeably more positive since. But Krugman's not giving readers the whole story.

There are two important details about the system's design that he doesn't mention—perhaps because they suggest the limits of the broader health policy lessons that can be learned from the VA.

The first thing he leaves out is that since 1999, the program has been organized into "priority groups" that determine who gets prioritized service. When vets enroll in the program, they get assigned to these eight groups based on their disability status and calculations of their income and/or net worth. Veterans with disabilities calculated as 50 percent or more disabling are slotted into the first priority group; veterans with lesser disabilities or no disabilities at all and higher income or personal wealth get ranked in lower priority groups.

The reason is that the service was designed first and foremost to provide care for those veterans with serious disabilities. As the Congressional Budget Office noted in a 2007 report, "veterans with no service-connected disabilities and with income and/or net worth above established thresholds, who previously had very limited access to the department's medical services" don't fall into the VA's "traditional target population." The program's administrators are clear enough about the reason for the grouping system: "Since funds are limited, VA set up Priority Groups to make sure that certain groups of veterans are able to be enrolled before others." 

The second important fact that Krugman fails to note is that on average most enrollees don't actually get the majority of their care from the VA. In 2007, the Congressional Budget Office reported that none of the eight priority groups received more than 50 percent of its care from the program. In 2010, the VA reported that just two of the priority groups—the two groups that have the highest cost per enrollee—had barely crept above 50 percent usage.

VA Reliance by Priority Group

So even the groups that rely on the VA the most end up turning to it for only about half of their care. For the rest of their health care, they rely on a combination of other public programs and private services, including Medicare, Medicaid, and private health insurance. This is not exactly a picture of a one-stop, fully comprehensive health system. 

And as Michael Cannon and Avik Roy have pointed out, the VA still has problems providing quality, timely health services as well. Disabled vets sometimes have to wait months to get benefits, and then only after drawn out fights with the bureaucracy.

But the larger point is that it would be hard to replicate the structure of a system like the VA at the national level, with blatantly prioritized service levels and huge gaps in care that end up being filled by outside services. The VA is a government-run system that controls spending by creating a strict prioritization heirarchy in which certain people are more entitled to care than others, and by relying on outside providers and payers to cover a lot of what it doesn't do. On second thought, maybe Krugman is right and there are "important lessons" to be learned about health policy from the VA—just not the ones he thinks. 

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  1. Everyone who has ever had to deal with it hates the VA. The only reason you ever go there is because you are too old or poor to have any choice or you got blown up and the VA is the only place that will take you.

    Pauli Krugnuts really will say anything. And since his brain dead readers have probably never met anyone in the military, I am sure they believe it.

    1. One night, on watch, I listened to a couple of MCPO’s have a discussion on what parts of the country had a decent hospital for active duty people but no VA hospitals within 50 miles.

      Apparently, in such places, the active duty hospital is used by the VA system to treat its charges.

      Yes, they were actually basing their choice of the place they were going to spend their retirement based in significant part on keeping their asses out of the VA system.

      1. you should let them know, that unfortunately, the active duty hospitals hate the shit out of those veterans and do the best to give them the bare minimum care. Part of this is because the VA administration treats the DOD hospitals like an entitlement.

        1. tarran: (see below if you want to know how I have insight into this)

        2. Dude! I was an Ensign. They were Master Chiefs. A wise ensign keeps his fucking mouth shut in such times or he finds himself scheduled to stand UI watches every for weeks!

          1. er …every midwatch for weeks!

          2. Well, not directly =). Surely there’s a way to send things through the gouge.

            1. The last time I wore a uniform was 12 years ago.

              At this point, it’s way too late and I am utterly indifferent to their fate.

              1. well, I’ll be sure to remind you when you’re reincarnated as an ensign to suffer the same fate again.

        3. I was a patient admin NCO, and it wasn’t that we hated retirees, it’s that they were officially lower priority than active duty.

    2. I’ve heard that (like a lot of things the government provides) the quality of VA hospitals is highly variable.

      I’ve heard pretty good reports about the Tampa VA, but then it’s connected to the USF Medical School so possibly it has access to better resources.

      When they closed the Orlando Naval Training Center, they transferred the base hospital to the VA. They’re still bussing patients for major treatments (radiation and chemo) to Tampa.

      1. I know three people who have dealt with the VA here in Tampa and I haven’t heard anything positive. It may be better than Orlando but that isn’t necessarily a big plus.

      2. I have dealt with the Tampa VA as well as others, and it’s the best VA hosital I have dealt with. It’s also worse than every civilian hospital I’ve ever dealt with.

    3. I have to disagree with you John. My experiences with the VA Hospital here in Fargo have been mostly positive. Of course I am a mostly healthy individual. My last routine appointment with my Primary Care doc lasted less than 5 minutes.
      I think my quality of care is possible because of the relatively low number of patients using this hospital and has little to do with the efficiency of the VA system.
      My Doctor has made comments on the limited resources he has to deal with in some cases. Wait time for non routine care can be months.
      Non routine Meds can also be an issue and many times will not be covered.
      And finally I think my Doctor started working for the VA because he was tired of dealing with Malpractice insurance as a private doctor.

    4. My military service was a long time ago, but I was never too impressed with the active duty healthcare system. Getting a competent doctor was a matter of simple luck, and I wasn’t lucky often.

      1. My experience as a patient with military health care wasn’t so great either. I had an Air Force orthopaedic surgeon tell me that I was faking the pain in my knee (and apparently the swelling too) to get out of PT. He pulled the MRI up while I was in the room, looked at it, and said, “Don’t make stuff up; there’s nothing wrong with you.”

        It wasn’t until 2 years later when I changed units that I saw the radiologist’s report that said that the MRI showed a longitudinal tear and a complete radial tear in my medial meniscus.

    5. The only reason you ever go there is because you are too old or poor to have any choice or you got blown up and the VA is the only place that will take you.

      Which is why all healthcare should be privatized?

      1. Of course not.

  2. Mandatory military service. That’s all we need for utopian universal health care.

    1. It’s definitely a good way to control costs. Fewer citizens means less pressure on scarce healthcare resources.

    2. No we need national service. Mandatory national service. That way we can work in the fields and educate the childrens and so forth. And then get our healthcare from the VA provided we deal first with the sabateurs and wreckers.

      1. That sounds like a cure for our laziness.

  3. “Penis! Penis! Big fucking erect penis, Mom!”

  4. Does Krugman ever do a little research prior to putting large feathered pen to parchment? What a tool.

    1. I’m sure he does, otherwise how would he know which attenuating facts to omit.

  5. Priority grouping is a responsibility of our Disability Estimation and Triage Help Panels.

      1. Well, it wasn’t all that freakin’ subtle.

  6. it would be hard to replicate the structure of a system like the VA at the national level

    As I recall, the dreaded HMO was more or less an attempt to herd patients customers into a vertically integrated system with some significant similarities; the results were not widely praised.

    1. But that was the evil private sector. It will be different when the government tries to do it. Trust them.

  7. I once did research for a project in a lab in the basement of a VA hospital. It was the perfect storm of depressing. I eventually started keeping my office door closed because the legless old men who were lost and asking for directions made it impossible to get any work done.

    1. Are you a pharmacist or biologist or psychologist or something?

      1. Don’t be silly; Warty is a analrapist.

        1. The world is not yet ready to know the true nature of my work. *maniacal laughter*

          1. Were you working on Obamacare Part II?

          2. Dude, tell me you’re making robot pants.

            1. Part of his work is the study of how to rape robots. I swear.

              1. So he’s developing artificial consent subroutines for the express purpose of ignoring them?

                That’s some sick shit, Warty.

                1. He read Saturn’s Children and got the wrong idea.


          3. We’ll never know what Warty was doing there until it is far, far, too late.

        2. You know, you’d think schools would welcome having access to the practitioners of the latest, most comprehensive mental health treatment system. But no, tell them what you do, and they call the cops. 🙁

          1. So you are saying that Joe Paterno was being much more open minded about mental health treatments than most of the rest of us

            1. On the off chance you don’t know, it’s an Arrested Development joke:

              Tobias F?nke: Okay, Lindsay, are you forgetting that I was a professional twice over – an analyst and a therapist. The world’s first analrapist.

  8. I have a close relative who works for the VA as a high-level administrator, internally blew the whistle on not collecting payments for doctors (millions of dollars lost), and blew the whistle on mold growing in a senior center, and was rewarded by getting “rubber roomed”, they pay him thousands of dollars to do nothing but sit and stare at a wall. Now that’s efficiency!

    1. “they pay him thousands of dollars to do nothing but sit and stare at a wall”

      Some people would enjoy that job. Me? I could get more writing done as long as I was allowed to bring my laptop. This might actually encourage more whistle-blowing.

      1. absolutely true. Drives my relative up the wall. He used to be an O-6 in the navy, his job was to cut across inter-service rivalry and red tape and design and implement cross-service inventory system. He got it done.

        Unsurprisingly, he was denied promotion by the VA due to “lack of leadershit”.

        1. mean to write leadership but maybe true too.

          1. I think it was a Freudian slip – and very true.

            1. eh, forget freud. I had too much coffee today, and I’m a little jittery waiting for my experiments to happen.

  9. Krugman photo caption for all you Beavis and Butt-Head fans: “Would you like to pet my Poopy?”

  10. Fewer citizens means less pressure on scarce healthcare resources.

    Somebody forgot to tell the doctors and nurses in Iraq and Afghanistan; they just keep on saving grievously wounded GIs.

  11. they get assigned to these eight groups based on their disability status

    OK, fair enough.

    and calculations of their income and/or net worth.


    1. The income calculations apply only at less important (higher numbered) priority levels.

      1. Sorry, Pete, but that doesn’t help at all.

        1. Pretty sure that means rich veterans have lower priority then poor ones.

          If we’re going to have government run health care for veterans, it should go to those who need it most and can’t afford to pay for the better healthcare available in the private sector.

          Personally I’d be more in favor of paying wounded vet’s medical bills instead of setting up a whole system run by the government.

  12. It took seven months before my ex-brother-in-law got treatment for his severe case of hypochondria, but now he is totally satisfied with the VA because twice a week he spends the afternoon getting the attention he craves. Four MRI’s, negative.

    1. All of this treatment for a hypochondriac because a doctor misdiagnosed the dramaqueen’s anxiety attack for a stroke.

  13. Maybe the VA system really is pretty great at providing high levels of service for people with acute, long-term medical needs, like a seriously disabled vet.

    This suggests to me that people make a category error when dealing with “health care,” where because it’s all, like, “stuff administered by a doctor,” we pretend it’s all one thing.

    But that’s kind of crazy. It seems clear to me that there is a really significant difference between “going in for a routine check-up or getting some antibiotics for strept throat,” and “I broke my arm in a skiing accident,” and “I have a chronic illness and will be dealing with medical interventions and a drug regimen for decades.”

    Why should we imagine that one system would be good for dealing with all three of those needs?

    I think that the best case for a socialized medical program is for people in that last category: people with extremely high, ongoing forever (or at least years) medical costs. Like, say, badly disabled vets. They’re the people that a for-profit insurance company is going to fight the hardest to cut out, because they’re huge money sinks. And they’re the people who won’t be able to afford their own medical care even if the system is super-efficient in terms of containing costs. So, yeah, use the VA model for those people, if it indeed works well.

    But it’s kind of crazy to imagine that since that system works well (or at least let’s stipulate it does) for badly disabled vets, the same payment model and administrative structure will also work well for “My son Timmy needs some allergy medication to deal with his hay fever.” There’s no reason why THAT section of the industry can’t be dealt with by out-of-pocket payments that give consumers an incentive to help control costs.

    And the “broken arm in ski accident” situation sounds like an actual case for honest-to-god INSURANCE, like how fire or automobile insurance works, protecting you from unlikely disasters. Instead of our crazy “insurance” model that we presently have that covers routine expenditures.

    1. I think that the best case for a socialized medical program is

      everything went sort of fuzzy after that.

      1. Yeah, I figured that would be a lot of people’s response, here. But, honestly, what do you imagine the alternative is?

        Are we going to let people with chronic-but-not-necessarily-fatal health conditions who aren’t also extremely wealthy suffer and/or die in the streets? Do you imagine that Joe Schmoe who, say, comes down with multiple sclerosis is ever, even in a sleek, efficient, market-oriented health care system, going to be able to pay for decades of treatment himself?

        Either we’re going to say that chronically sick people just don’t get treatment at all, or someone else is going to bear the cost of their treatment. At that point, you’ve got the choice of “insurance companies (or some kind),” or “the government.”

        Since we’re all good libertarians here, we know that companies respond to economic incentives. And, indeed, since we live in the real world, we have seen how insurance companies respond to these incentives: chronically ill people are enormous money sinks, and a (rightly!) profit-maximizing company will try really, really hard to dump such people. Trying to prevent them from doing so with regulation will tend to result in the labyrinthine, overcomplicated regulations that we, as good libertarians, know is ultimately market-distorting and prone to regulatory capture and otherwise bad. And, ultimately, all you’re doing is putting the costs on other people anyhow, the other people paying those insurance premiums.

        Let’s cut to the chase. It’s morally distasteful and politically a non-starter not to treat the chronically ill. Trying to force insurance companies to do it just doesn’t work well, and we’re seeing that right now. The chronically ill can not pay for their own treatment. This is an area where, as wasteful and inefficient as the government is, it’s the best of the bad options.

        But where we should diverge from the liberals is that we don’t need to imagine that that same calculus applies to the overwhelming majority of all people who aren’t chronically ill. Someone who needs weekly dialysis is not remotely the same as someone who needs some prescription acne medicine, or even someone who gets an acute-but-curable infection. We don’t need to build everyone’s medical payment scheme around the small fraction of the population who have enormously outsized medical needs, and we can use market forces to keep costs low for routine and acute — but probably not chronic — care.

  14. Notably lacking is an explanation for why private sector services are superior. You’ve essentially said “they painted the VA building blue” and then pretended that’s a criticism. Prioritizing care seems like a valid thing to do (if they weren’t doing that I presume you guys would be criticizing it for not prioritizing for the sake of efficiency). Same with the proportion factoid, who cares? What does it have to do with anything?

    1. The proportion factoid has a lot of relevance to the notion that the VA system could be expanded into a British-style NHS single-payer system, while retaining its present stipulated quality.

      If the VA system is providing its present level of quality by providing a focused, limited set of services that do not purport to be comprehensive for even its most heavy users, then we have no evidence that it could maintain any such level of quality if it were supposed to provide much larger proportions of the care of a much larger percentage of the population.

      From what I’ve heard, the VA system does an admirable job of providing specialized care to a high-need chunk of population, including a lot of people with sufficiently severe psychological disorders that they are incapable of caring for themselves, or, indeed, self-harm. And that’s great, it’s laudable, and it may make sense to expand that system beyond its present confines.

      But there’s little reason to believe that the same system would be great at providing care for a much larger population with much less acute need.

  15. It’s not like a well-respected member of the Nomenklatura such as Krugabe would ever find himself in the clutches of the National Health.

  16. Emails show Kagan excited about Obamacare passage

    At her confirmation hearing in 2010, now-Supreme Court Justice Elena Kagan that she “was not” asked at any time to give her opinion on the merits of the Obamacare legislaton. Newly released emails suggest that whether or not she was asked, Kagan was not shy about her enthusiasm for the bill that eventually became law.

    Kagan, while serving as President Obama’s Solicitor General, exchanged emails with her then-colleagues in the Justice Department indicating her support for the Obamacare legislation when it was under consideration in Congress.

    “I hear they have the votes, Larry!! Simply amazing,” Kagan wrote, in an email obtained by Judicial Watch, on the day Obamacare passed through Congress. Larry Tribe, a Harvard Law professor and Supreme Court attorney who served as “senior counselor for access to justice” in the Department of Justice (DOJ), replied to Kagan that the bill’s passage was “remarkable.”

    “And with the Stupak group accepting the magic of what amounts to a signing statement on steroids!” Tribe added in delight, and in derision for the pro-life Democrats.

    As far back as October 2009, the day-to-day developments regarding the bill popped up in the course of Kagan’s work at DOJ. For instance, then-Deputy Solicitor General Neal Katyal interjected, into an otherwise unrelated email thread, the news that “We just got Snowe on health care,” — referring to the support for Obamacare promised by Sen. Olympia Snowe, R-Maine.

    On the day that Obamacare passed, Katyal reportedly forwarded Kagan an email about a meeting with “the health care policy team tomorrow at 4 to help us prepare for litigation” that he recommended she attend. Kagan didn’t respond to that email in writing, but instead asked for his phone number so that she could call him.

    Forty-nine members of the U.S. House have called for Kagan to recuse herself from the Obamacare hearing. No mention of her involvement or recusal was made in the Court’s announcement that it will take the case.


  17. If I were that cat, I would patiently wait for the perfect opportunity to viciously claw his testicles.

    1. You first would have to patiently look for them.

  18. These are just exercises in imputing thoughts to Krugman while he can always come back with, “I didn’t say that.”

  19. I used the VA as an example of “the socialized medicine of the future” while watching them under-treat my father-in-law’s cancer. Before that, I saw the VA take eight hours for a blood test (takes my doc less than 15 minutes to draw blood at private care) and watched as VA staffers walked around my buddy laying in the hall, vomiting in pain from a pee stone.

    … Hobbit

  20. “Cat, check. Beard, check. Once my Nehru jacket comes in, I’ll be a super-villain.”

  21. I think your first point isn’t really going to convince anyone who isn’t already convinced that government healthcare is bad. At some point, don’t you have to prioritize no matter what? We can’t just give everyone everything they want or need without breaking the bank. You can’t do this in your personal life (the hospital won’t very well let you run up millions of dollars in lifesaving, necessary procedures if you don’t have the money for it), so why should “government healthcare” have to shoulder the burden of giving everything to everyone? It seems common sense to say that the people with the most serious injuries get the highest priority and those with sufficient personal wealth to pay for their own care should do so.

    Your second point, however, is pretty convincing. It is really disturbing that many people probably rely on the VA for 100% of their care yet the VA is only giving them 50% of what they need. This could be related to your issue of “prioritizing,” but it also could just be due to underfunding or lack of any motivation to increase the amount of care given to the individual patient.

    I don’t agree with everything you guys write, but more often that not you stimulate some thought which is why I come here.


  22. I’ve been in the VA Health system for twenty years and I’ve gotten far better and more responsive service than my relatives with private insurance. Don’t buy into the biased hype we are bombarded with by the people who are making big money with our current lopsided worthless system.

  23. Not surprisingly, Suderman and a lot of the commenters here are missing the point. Yes the VA has some important differences that would not make sense to replicate on a larger scale (such as the priority groups). However, there are a number of things that the VA has, such as electronic health records, salaried physicians, a focus on primary care, and an evidence-based formulary for drugs, that allow it to provide higher quality care and control costs. These characteristics could be utilized by other hospitals as well.

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