For eight years, until May 2013, I directed the Department of Veterans Affairs (VA) medical research program from its Central Office and became familiar with the operations of the Veterans Health Administration (VHA). It was my only VA job and I felt honored to be part of the VA’s vital mission, as did most VA employees I met. Based on this experience, I have some ground level observations on the state of the VA and its future planning in light of the present scandal.
VA’s Scope and Assets
VA has three components: a large health system (VHA), a benefit center (Veterans Benefits Administration, or VBA), and the highly regarded National Cemetery Administration. All report to the VA Secretary but have different missions, issues, and management requisites. For example VHA was a pioneer in the Electronic Health Record (EHR), while VBA has had a more recent painful conversion to information technology (IT). VHA is run by the Undersecretary for Health, on whom VA Secretaries almost totally rely given their general lack of experience in health care.
VHA is divided into 21 networks and has 8.9 million enrollees (out of the 22 million U.S. veterans). It cares for 6.4 million veterans annually at over 1,700 sites of care, including 152 hospitals, about 820 clinics, 130 long-term care facilities, 300 Vet Centers for readjustment problems, and a suicide hotline, as well as homelessness and other programs. It has partly trained two-thirds of U.S physicians and made groundbreaking medical research contributions. These assets create strong constituencies for VA both within and outside the veterans’ community.
In 2014, the VA Medical Care appropriation was $54.4 billion, and VA has not been part of the government’s sequester of funds. From FY 2002 to 2012, there was a 29 percent increase in enrollees, an 80 percent increase in outpatient visits, and a 25 percent increase in inpatient admissions, while Medical Care funding rose by 149 percent (not inflation adjusted).
Quality metrics in VHA are generally favorable, though variable with clear-cut exceptions. Overall satisfaction for inpatient (84 percent) and outpatient (82 percent) care matches with industry (80 and 83 percent, respectively). Most veterans using VHA have dual coverage — i.e. Medicare, Medicaid, or private insurance — and many are in the income range to be newly eligible for coverage and subsidies under the Affordable Care Act. They could obtain their care elsewhere.
The reasons that eligible veterans use VA health care include tangibles and intangibles: VA expertise in post-deployment conditions and quality of care; veterans’ comfort with the atmosphere; the opportunity for veterans to socially meet and chat with fellow veterans in the hallways (less utilized in this generation); and the lack of coverage, or lower coverage, elsewhere, especially for certain items such as expensive drugs, e.g. cancer chemotherapy.
Operational Inefficiencies and Increased Bureaucracy
As any VA employee will tell you, VA has basic operational deficiencies in Human Resources (HR), contracting, and IT, stemming from both VA and general government policies. The one-size-fits-all complex policies (influenced by the appropriate need to prevent favoritism) may not fit well with health care and strongly impair VHA’s function. There are difficulties in hiring anyone, finalizing a contract, or purchasing needed IT software, though in research we were able to make progress because HR and Contracting agreed to assign particular individuals for our special needs. IT has often been besieged by bureaucratic battles and even VHA’s much vaunted and unique EHR system has fallen behind. Obsolete software for scheduling, dating from 1985 and considered antiquated, is part of the current scheduling failure.
VA’s excessive growth in mid-level administrators is well known. For example, according to IG reports in 2012, the network offices had 500 percent and 380 percent increases in operating expenses and personnel compared to original estimates, and great variability in expenditures for similar functions. In the VHA Central Office, there was growth from about 800 (late 1990s) to nearly 11,000 (2012) persons, and a reorganization in 2010 added a level of unneeded bureaucracy.
Performance Monitoring and Oversight
Because of its massive size, VHA is hard to manage. Performance measures, for promotions, bonuses, etc., are a fundamental part of governance to implement policies and guide an organization’s behavior. Unfortunately, despite attempts at improvement, VHA’s vaunted and pioneering quantitative performance measures have evolved into dashboards encompassing hundreds of data points with uncertain focus that do not encourage oversight.
Regarding oversight, a 2012 IG report on network offices found that VHA leadership did not effectively oversee the networks, and there was lack of effective management of finance and other areas, including a lack of reliable network office staffing information. In addition, the performance measures and their implementation did not “adequately foster improved (network) management and oversight of healthcare facilities,” and leadership appeared to be more focused on initiatives than the basics.
The Scheduling Problem
VHA’s underside came to the public attention in the scheduling scandal in which there was systemic falsification using unauthorized secret lists.
It was a perfect storm of adversity: a constantly increasing patient load without a compensatory increase in providers; poor utilization; too few medical personnel, with workloads that sometimes were too small; a background of operational deficiencies noted above; punishment and rewards based on numbers on which leadership careers depended; a leadership focus more on initiatives than on basics; lax oversight and poor auditing and verification of network and medical center data and documents; reliance on unverified numbers by VHA and VA leadership; little health care experience in VA leadership; congressional unhappiness building over years because of the VA’s inability to cope with delays; and, apparently, a culture of dishonesty in creating fraudulent documents.
Already in 2010, extensive gaming of scheduling lists was well known, and by 2014 there are 18 IG and 4 GAO reports, numerous congressional testimonies, and a Booz Allen consultant report on scheduling delays and insufficient oversight.
In 2011, the unrealistic and unnecessary VHA mandate of appointments within two weeks, made in the face of failure of longer limits, caused the cascade of events that ultimately, because of dishonesty and harm, put a national spotlight on the festering problems. Over 75 percent of VA Medical Centers had unauthorized scheduling lists.
Steps Toward VHA Recovery
Short and Intermediate Term
Steps toward changing VA will have varying degrees of difficulty depending on whether they require cross-government action and how deeply they change VA culture. In my view, VA should:
- Immediately address the wait lists, mainly by outsourcing care (triage is already underway, in part utilizing Central Office administrators). There is obviously not enough time to gear up VHA itself. Contract care for services not available locally and emergencies now account for about 10 percent of VHA’s budget.
- Institute rational wait time policies, dependent on need to be seen.
- Appropriately punish transgressions. Undertake a deep institutional evaluation of whatever culture of dishonesty or gaming exists and make necessary changes.
- Emphasize basic oversight, facilitated by appropriate performance measures and leadership attention.
- Performance measures need focus and goals to strengthen oversight, compliance, and quality of care. Their function is not bureaucratic micromanagement, which weakens proper governance. The Strategic Analytics for Improvement and Learning (SAIL) dashboard, focusing on 28 metrics for quality, is being tested by VA and offers promise.
- Institute modern, precise, refined, and deep-dive auditing tools to verify scheduling, quality of care, and all other relevant data.
- Conduct unannounced site visits of networks and medical centers for certain compliance issues. We used these in the research program with success.
- Recruit providers. Reversing the VHA physician shortage is crucial and hampered not only by below-market salaries but also by adverse overall working conditions and bureaucratic attitudes (as seen in the contrary responses to whistleblowers that reported scheduling difficulties).
- Make clinic and other systems more efficient, not only in scheduling but also in the use of clinic facilities, the time spent with patients by medical personnel, and the level of bureaucracy.
- Be transparent in all quality and access data. VA has been at the forefront of publishing its quality data, especially in surgery, but a recently reported conflict over releasing SAIL data that showed quality variability is not consistent with this attitude. The public has a right to know and the secretive behavior itself hurts VA when data finally do come to light.
- Institute new and simplified policies and actions for IT, contracting and HR problems. Such action is crucial for VHA’s success and difficult because, in part, it requires cross-government solutions and considerable bureaucratic change. Improvements should include IT procurement capability, HR policies for both recruiting and dealing with rank-and-file, contracting policies and more local policy autonomy, with adequate auditing.
Congress needs to continue to be productive in oversight and legislation. As a hopeful start, a bipartisan bill passed in the Senate authorizing veterans to seek care elsewhere for two years (for long wait times or distant facility location) via a “choice card.”
The bill also provides funding for new medical personnel and the leasing of medical facilities, easier ability to discharge senior officials, expedited hiring authority, and the establishment of independent commissions to review VA. Emergency supplemental funding would be used. Further congressional action is needed to address the operational policy problems noted above.
The basic options for VHA’s future are to fix the current system and/or privatize veterans’ health care. For many reasons, there is no real support for abolishing the VHA system. Therefore, in the future, outsourcing of VHA care will increase, probably changing VHA somewhat; overall numbers will ultimately decline from the passing of Vietnam and earlier veterans; and correcting VHA’s deficiencies will be the major focus. Also, dual health care coverage, which most veterans have and which is administratively a thorny problem for the federal bureaucracy, will likely be more a part of future discussions.
Advocates for “choice” (vouchers for care with maintenance of VHA) point to its advantages: Choice personally benefits veterans by allowing efficient care when VA falters; competition should be a stimulus for VHA improvement; providing resources via outsourcing may encourage programs for veterans in civilian institutions; lower numbers might enable the VHA system to better handle its patient load; and perhaps choice better suits a health care benefit for an all-volunteer army. In this scenario, VHA would be smaller, probably have somewhat less national reach, and focus more on post-deployment conditions.
Families, who are profoundly affected by the injuries and illnesses of returning veterans and are largely not included in VHA health care, do not seem to be part of the current discussion.
Note on Implications for Other Health Care Systems
Though there are unique features, VHA’s setbacks are a warning of what can happen when numbers are the goal for personal benefit and there is insufficient oversight and lack of leadership attention to basics. Other health care systems need to follow the issues that surfaced at the VA, as well as how they are resolved.
Any deep changes in the VA will be much more complicated than they first appear and have unforeseen consequences and wide interest. The goals now may be more difficult than the impressive VHA transformation of the 1990s and again need inspired leadership as well as health care experience at the top.
I am in agreement with those who believe that the latest crisis opens opportunities for real progress to help the nation’s finest, but we must be ready for complexity and roadblocks. Legislation is already being prepared and a Presidential Commission seems in order. Even as the furor dies down, pressure must be continuously applied for the country to arrive at the best options for veterans’ health.