Veterans Affairs Secretary Anthony Principi dropped a bomb Friday in meetings with key legislators and veterans' groups by announcing unexpected administration policies that amount to two steps forward and one step back for veterans.
Effective Friday, Principi will use his secretarial power to suspend enrollment in the VA health program for selected veterans for one year. That means an estimated 160,000 so-called "category eight" veterans with no disabilities and incomes above a means test adjusted for local cost of living, which could range from $24,000 to over $30,000, will not be able to be enrolled.
The suspension is intended to relieve VA's huge backlog of eligible veterans waiting for enrollment. Currently more than 200,000 veterans are waiting more than six months for their first medical appointment with VA.
By the end of the year, Principi hopes to be able to let some of those "category eight" veterans back into VA facilities under an agreement he has struck with HHS, with the approval of the White House. VA would become, in effect, a Medicare+Choice option for veterans holding Medicare Part B.
While implementation will take months, the plan would constitute the first time that Medicare has ever paid for care delivered through the VA-a longtime goal of veterans' advocates.
In its fiscal 2004 budget, Principi said the administration would request a historic $64 billion for the VA: a $4.1 billion increase over the fiscal 2003 budget request from $25.9 billion to $30 billion in discretionary spending, mostly health care, and a $1.2 billion hike from $32.8 billion to $34 billion in mandatory spending, mostly disability and pension benefits.
Senate Veterans Affairs ranking member Bob Graham, D-Fla., Thursday issued a statement condemning the new restrictions on enrollment as representing "misguided priorities." Sen. John (Jay) Rockefeller, D-W.Va., the previous Veterans Affairs Committee's ranking member, likewise told National Journal in a statement, "There is no question that VA is plagued by significant funding problems, but blocking health care for our nation's veterans is not the answer."
Senate Veterans Affairs Chairman Arlen Specter, R-Penn., said in a statement that he was "very concerned" about the restrictions and pledged to hold hearings. But he approved the deal with Medicare, which "I have been pushing VA for a long time to undertake," he said.
By contrast, Senate VA-HUD Appropriations Subcommittee Chairman Christopher (Kit) Bond, R-Mo., focused on the increased 2004 budget request, which he called "a huge victory for veterans' advocates."
Ronald Conley, national commander of the 3 million-member American Legion, denounced the plan, saying the damage done by curtailing eligibility far outweighed both the budget increase-which he called too small-and the new Medicare option.
"We just keep taking steps back; I haven't seen any steps forward yet," said Conley, reached via cell phone during a nationwide tour of VA facilities. "Cutting off veterans for access into the hospital is not the way to go; when Congress authorizes veterans to use that VA facility, then they need to properly fund it."
But representatives of veterans groups who were present at Principi's announcement were remarkably positive. They focused on the agreement to let Medicare pay for care in VA facilities, a longtime goal. And most groups had expected some restriction of enrollments would be inevitable to protect an overloaded system and its core constituency, disabled and indigent veterans.
"I would love to see everybody continue to be treated, but I understand what the secretary has done," said Robert Wallace, executive director of the Washington office of the 2.7 million-member Veterans of Foreign Wars. "I put the blame on the United States Congress for not funding veterans' health care the way they should."