Sen. Marco Rubio, R-Fla. , said the current VHA model doesn't work anymore.

Sen. Marco Rubio, R-Fla. , said the current VHA model doesn't work anymore. J. Scott Applewhite/AP

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Vet Group Wants to Turn Veterans Health Administration Into Amtrak

Proposal would transform federal agency into a government-chartered nonprofit and give vets a private health care option.

The federal agency that provides health care to vets should be turned into a non-profit government corporation that competes with the private sector for patients, according to a veterans’ advocacy group.

The conservative-leaning Concerned Veterans of America recommends splitting the Veterans Health Administration into two entities, one that focuses on hospital and clinical health care for vets, and another that runs the department’s health insurance component. Under the proposal, the VHA would operate along the same lines as Amtrak, the rail service that is independent from the government but also receives some federal money.

Veterans would have the choice to stay within the VHA health care system, or obtain care from providers in the private health care network. Those who chose the latter would have to help subsidize the cost of their care through co-payments and deductibles, similar to the Federal Employees Health Benefits Program for civilian federal workers, which the CVA report called “the oldest and most successful premium support program in the world.”

The idea behind the proposed reforms is to improve health care veterans by offering them more choices, but also creating competition for VHA and giving the agency incentives to become more efficient.

“This approach is not anti-VHA,” said the report, crafted by a bipartisan task force headlined by former Sen. Bill Frist, R-Tenn., and former Democratic Rep. Jim Marshall of Georgia. “It is pro-veteran. The VA should be given every opportunity to compete for veterans’ health care dollars. But it can no longer take veterans for granted as customers. Some veterans get great care from the VA and will want to continue doing so. Others do not and will not.”

CVA on Thursday released its recommendations for overhauling VHA -- the Veterans Affairs Department agency at the heart of the management scandal involving patient wait times -- during a Capitol Hill event featuring several high-profile Republicans, including possible presidential hopeful Sen. Marco Rubio of Florida.

The current VHA model doesn’t work anymore, Rubio said. “The challenges before our veterans have changed, and the way we provide service for them must change as well. The result of the current system is pretty straightforward. Our veterans today are facing, and are met with, the same charm and the same efficiency from the Veterans Administration as they get from the Department of Motor Vehicles or the IRS,” the Florida Republican said. “I believe they deserve a lot better than that.” Rubio said navigating the VA health care and benefits system is a huge issue for many of his Florida constituents.

As part of the report, CVA surveyed roughly 1,000 vets, with 90 percent of respondents favoring “efforts to reform veteran health care in this country.” But what that reform should look like is a matter of debate.

VA Secretary Bob McDonald was not thrilled by CVA’s recommendation to carve out VHA from the rest of the department. “Unfortunately, many of today’s proposals advocate ‘contracting out’ a sacred mission to care for those who have borne the battle,” McDonald said in a statement. “There is an important role for outside care in the veteran health model to supplement VA’s own care, but that role should not diminish or obscure the importance of VA’s health care system. Reforming VA health care cannot be achieved by dismantling it and preventing veterans from receiving the specialized care and services that can only be provided by VA.”

The 2014 Veterans Access, Choice and Accountability Act allows some vets temporary access to private health care rather than waiting for a VA appointment or traveling more than 40 miles to a VA facility. The Obama administration has said that not as many vets as expected have opted out of the VHA system at this point. President Obama’s fiscal 2016 budget recommends taking any money left over from that “choice” part of the law and channeling it back into other VA programs, which many lawmakers oppose.

The task force did not call for a wholesale dismantling of the VHA, and emphasized that vets who want to stay within that health care system would be able to do so under the proposed recommendations. The agency runs the country’s largest integrated health care system, with 150 medical centers and nearly 1,400 local outpatient clinics, vet centers and other facilities. Most of the VA’s roughly 313,000 employees work at VHA.

Frist, who spoke during Thursday’s event, sought to distinguish between VA employees and the bureaucracy. “[VA] hospitals are full of people who are committed, who are hard-working, who want to do the very best for that individual patient and take them, and love them and give them the care that they deserve,” he said. “But the system sets up barriers that restrict and restrain, and come between that desire and that commitment between the individuals who are in these VA hospitals … we’ve got too many barriers in their way to deliver that care.”

The idea of privatizing veterans’ health care and transforming the VHA into a government-chartered corporation is not new. But it’s fair to say that the reaction from stakeholders will be mixed.

The Military Officers Association of America did not take a position on CVA’s report. “The important thing is that this allows for further dialogue and another perspective that should be considered,” said Rene Campos, deputy director of government relations at MOAA. Campos said that there are a lot of challenges facing the veterans’ health care system that privatization won’t necessarily improve (or make worse), such as data-sharing. The VA and Defense Department historically have had problems sharing health care information, and there’s no indication the situation would improve between the VA and private health care providers. All the ideas on reforming VA health care need to be “thoroughly debated and understood,” Campos said.

The American Federation of Government Employees, which represents many VA workers, did not immediately respond to a request for comment. Other veterans service organizations contacted for comment on the CVA report also did not immediately respond.

Some of Thursday’s speakers argued that VA employees, who are enrolled in FEHBP, have more health care choices than the vets they serve. “It’s kind of ironic that people who work at the VA have choices in the health care that they get, but veterans who enroll in the VHA are captive to the system,” said Avik Roy, a co-chairman of the CVA task force and senior fellow at the Manhattan Institute’s Center for Medical Progress.

Rubio was less diplomatic. “The fact that those very bureaucrats have more options for their own health care than the veterans they are supposed to be working for is immoral and makes no sense,” he said.