Reforms to ‘Choice’ Program Raise Questions about VA’s Future

Opponents Say Pilot Programs Could Lead to Privatization

By Sandra Basu

WASHINGTON—Calling the criteria to access community care “arbitrary” and “unnecessarily cumbersome,” VA Secretary David Shulkin, MD, sought support from lawmakers last month to improve the processes.

“Our goal is to modernize and consolidate community care. We owe veterans a program that is easy to understand and simple to administer and meets their needs,” Shulkin told lawmakers.

Some senators raised strong objections, however, questioning whether the proposals would ultimately lead to privatization of veterans’ care.

Under Shulkin’s proposed Veterans Coordinated Access and Rewarding Experiences Program (CARE), eligibility to access community care would no longer be based on distance from a VA facility or a 30-day or longer wait, as is currently the case with the Choice Program.

Ranking Member Sen. Jon Tester (D-MT) of the Senate Committee on Veterans’ Affairs, shown here talking to a veterans, warned that the proposed FY 2018 budget moves the VA toward privatization. Photo from Senate Committee on Veterans’ Affairs.

Instead, a clinical assessment by a VA clinician would result in a decision about whether a VA specialist is best for the patient or whether community care would better meet a patient’s needs.


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“If community care is the answer, then the veteran chooses the provider from a high-performing network. … Assessment tools help veterans evaluate community providers and make the best choices themselves,” he said. “We may help veterans schedule appointments in the community or in some circumstance veterans may schedule the appointments themselves.”

Shulkin said this was all about “individualized, convenient, well-coordinated modern healthcare and a positive experience for the veteran” And that legislation is needed to make the proposed changes.

“If the VA doesn’t offer the necessary service then the veteran goes to the community. If the VA can’t provide timely services, then the veteran goes to the community. If there are unusual burdens in receiving care, then the veteran goes to the community,” he said.

Still, Shulkin said he was not recommending “unfettered access” to community care


Shulkin made his comments on the Choice Program, one of VA’s community care programs for veterans, at a Senate Committee on Veterans’ Affairs hearing.

“We are at the point where, if we don’t fix it permanently, we are going to have a program that is out of money, out of gas or out of both,” Senate Committee on Veterans’ Affairs Chairman Sen. Johnny Isakson (R-GA) said of the current VA Choice Program.

Several Democrats on the committee agreed that change was needed to VA’s community care program but expressed concern that Shulkin’s proposal might move VA too far in the direction of privatizing VA care.

Ranking Member Sen. Jon Tester (D-MT) said the proposed fiscal year 2018 budget gives a 33% increase for private sector care vs. 1.2% for care provided directly by VA.

“We are privatizing the VA with that budget,” Tester warned.

Shulkin answered, however, that VA is seeking flexibility from Congress to be able to transfer money between the two accounts so they can build capacity in the VA.

“The reason why we are letting people go in the community now is because, if VA doesn’t have it, we have to get them that care,” he said.

“If we don’t make the investment so that they can get that healthcare [inside VA], then they will never get it there,” Tester responded.

Also expressing concern was Sen. Patty Murray (D-WA), who pointed out that VA’s draft proposal for community care included pilot projects for VA regarding governance and an alternate care model that would send veterans directly to the private sector.

Murray noted that those proposals sound similar to concepts put forth by Concerned Veterans for America and in a paper that was known as the “strawman document,” written by seven of the 15 members of the Commission on Care.

 “I just want you to know that I will not support them, and I will fight them with everything I have,” she said.

Shulkin said he would like feedback from lawmakers and that he was not in support of “of a program that would lead to privatization or shutting down the VA programs.”

“What I am in support of is using pilots to testing various ideas about governance, about the way the system should be organized and the way we should evolve,” he emphasized.

Isakson said pilot projects are an “opportunity” and should not be feared.

He also denied that VA’s CARE proposal “is a threat to VA and VA healthcare” and suggested it might have the opposite effect of putting “additional pressure on VA and VA healthcare to provide services to a greater number of veterans.”

“We have no goal whatsoever to reduce the role of the VA healthcare system in the life of a veteran,” Isakson stated.

Advocacy groups also had an opportunity to weigh in on the new community care proposal.

Veterans of Foreign Wars Director of the National Legislative Service Carlos Fuentes said his organization “largely supports” VA’s proposal but that it opposes the pilot projects that VA is seeking as part of the proposal.

American Legion National Legislative Assistant Director Jeff Steele told lawmakers, meanwhile, that the American Legion “adamantly opposes the degradation of organic VA healthcare services and calls on this Congress and administration to reinforce and strengthen VA.”

“The American Legion simply urges the Congress to fund the community care program at appropriate levels, which should be no less than what is currently being allocated without cannibalizing other areas of the VA budget,” he said.

Comments (18)

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  1. Jim C. says:

    Last year, during congressional hearings for VA supplemental budget request, congressmen balked at the $3.3 billion dollar bill for some private care for 1.3 million veterans. This was for non va care such as mamographies and other procedures that a veterans local medical center could not provide. What is congress going to do when the remainder of the 9 million enrolled vets start self-scheduling outside care? What about the other 11 million living vets who are not currently enrolled in VA care? Are they expected to sit on the sidelines, while their colleagues are getting free community care at will? No. They can be expected to flock to enroll in this program. Simply put, congress cannot, will not be able to fully fund VA at $160 billion per year ($80 billion of which goes to health care) AND fund a growing and generous private care program. Something will give. First, funding will shift away from VA and toward growing outside care. Next, services will be curtailed and finally, eligibility will be severely tightened. Medicare eligible Vets will probably be required to use Medicare. In the end, on this current path, VA will cease to exist as a provider of care. It will be a payer of care, and then only for poor Vets and those with service connected conditions…for the latter group, it is likely that reimbursements (care) will only be for those service connected conditions.

  2. Laura Gaffney says:

    A lot of patients have trouble finding outside doctors because the VA only pays 80% of medicare rate and doctors don’t want to have to deal with more paperwork. It is much better in terms of coordination of care to have patients have all there health care in one place. This has been shown to have better outcome for patients. Most patients are happy most of the time with the care they get at the VA.
    The requirements based on distance and time to an appointment for the Choice are appropriate. However, the system is difficult to navigate and it seems the people running it don’t know enough yet to run it efficiently.

  3. John Eady says:

    I have worked in the VA System for over 25 years(contractual and full time) so have a bit of an understanding of the way the system works, from the highest level to the “trenches”. The first appropriate comment is that the legislators who voice concerns about “privatization” of the VA are either abysmally ignorant of the protective processes in place in the VA to insure optimum care for veterans or they are “grandstanding” for their constituents. Secondly, these representatives have no clue about how the health care climate in America has changed due to the legal profession’s influences (for whatever reason-genuine concern for optimal care or “diving for dollars”), and the laws passed by Congress. In today’s health care delivery climate, medical practitioners must refer patients to specialty and even subspecialty consultants to avoid being accused of providing services that are “below the standard of care” when the potential for ANY unfavorable outcome is present. The risks of being held liable, both financially and criminally, any unfavorable outcome is too high in today’s health care climate to take the risks of providing care that is perfectly appropriate but has a potential for an unfavorable outcome. As a result, patients are referred to specialists by Primary Care Doctors, and specialists refer them on to subspecialists when the potential risks (medical and malpractice) are in question. Add to that equation the limiting factor created by the dollar limits placed on the VA for hiring specialists and subspecialists in adequate numbers to provide this care and the need for referral to specialists and subspecialist in the non-VA setting can be predicted to increase instead of lessen or stay the same with the structure presently in place in the VA system. One has only to look at the patient scheduling scandals that occurred in multiple locations within the VA system (and are still occurring in limited numbers) to “get” one of the reasons for them.
    The reasoned approach for developing a system that works for the VA system is to 1. accept the permanent need for a non-VA referral process which acknowledges the lack of specialty or subspecialty care for certain conditions (a combination of “geo-burden” and/or absence of the service required)that is criteria instead of arbitrarily based, 2. establish non-VA resources for provision of that care(which can be more easily done presently than in the past due to the dollar limits on payment of specific services), and 3. using data based criteria for predicting the annual costs of such care.
    Once this, or a similar evidence based system is developed, the data will be available to educate the uninformed about the need for a permanent non-VA system for delivery of appropriate care and the costs associated with it.

  4. John Fahrenholz, M.D. says:

    VA physicians have for years made clinical assessments and determined collaboratively with their patients and colleagues when a consult to a community physician is needed. We called this program “Fee Basis” when I started working at the VA in 2006.

    The only perceptible functional difference with the Choice program has been the addition of the third party company, TriWest, as an intermediary to “help” coordinate the program. This has led to increased logistical and communication issues between VA physicians, our patients and the community physicians who partner in the care of our patients. This has in turn resulted in more fragmented care and duplication of services. I agree whole heartedly that “we owe veterans a program that is easy to understand and simple to administer and meets their needs.” The Choice program has been a step backward. We need to provide funding for internal resources to improve the community access program that was already in place within the VA. Increasing funding to support “private sector” care while effectively decreasing internal resources that must support and provide continuity for community care contributions is inherently flawed. Changing the name and paying TriWest or a different third party company more money to “fix” the problem is not the answer. We don’t need a new name; we don’t need TriWest. We need to fund and support programs within the VA system that enable efficient and well coordinated care internally and in collaboration with community specialists and any other necessary outside resources.

  5. Indira Krishnarao.MD says:

    Specialties that are in demand even in the public sector, seem to be understaffed at several VAs. If timely service can be provided for these Vets by referring them to community providers & allowing them to continue care with these providers would be ideal. As it stands now, the Vets are seeing community providers until they can be seen by VA providers, & this often results in duplication of services/ tests & fragmented care. Elderly Vets who live a significant distance away from the VAMC, should be allowed to seek care closer to their residence.

  6. Steven A. Atlas, M.D. says:

    The way that Dr. Shulkin’s ideas are described in this article does indeed sound like a move toward privatization. The author states that “a clinical assessment by a VA clinician would result in a decision about whether a VA specialist is best for the patient or whether community care would better meet a patient’s needs” and then goes on to quote Dr. Shulkin as stating
    that “If community care is the answer, then the veteran chooses the provider from a high-performing network. … Assessment tools help veterans evaluate community providers and make the best choices themselves.”

    It seems to me that the proper rationale for the Choice Program would be (1) to compensate for services that the VA does not or cannot provide (which would include timeliness and other logistical issues), or (2) to offer care outside the VA that would be clearly superior to that available by direct care in the VA. In the practice of medicine it has been a longstanding tradition that physicians know their own limitations and initiate referrals to other physicians when help is needed, and the VA system ought to include the flexibility for its physicians to refer to the community when appropriate.

    Dr. Shulkin’s statement strikes me as putting the horse behind the cart, and would appear to put the decision of choice squarely in the hand of the patient. Since excellence in medical care is generally a relative measure, what should drive this aspect of the choice process is the very availability of a provider who can deliver superior care. THAT should be the starting point for offering choice, and not first a decision to offer choice and THEN to select a provider.

    Patients ought to have a right to influence the direction of their care, but just as private health care plans impose restrictions on patients seeing out of network providers, the VA ought to be able to regulate community care according to clear medical criteria. If a patient feels strongly that they are being denied outside care inappropriately, then there should be a local appeal process established (e.g. review by the Chief of Staff or a committee of his or her designation).

  7. Frank says:

    VHA and its network will always be there for veteran care and IS needed. The VA does many things the private community cannot and it continues to lead in new treatments, coordinator care for battlefield illnesses and pharmacy program. VHA needs to provide a strong core of services, community partnership specialty care, VA specific specialists related to military disease/injuries (SCI and TBI)and Primary Care. If VA does not provide service or if same quality of care is available closer to community then veteran should have choice just like others with “insurance programs” do. Be mindful that many get VA care because of what community cannot or will not do and financial constraint’s that patients have with community copays. There are not more providers in the community that want more Medicare/Medicaid reimbursement patients, the government reimburse community providers at those federal rates for vets. There is and will continue to be a need to VA and Community care continuing forward.

  8. Max McHugh says:

    After nearly 20 years working as a clinician at a VA hospital following years of working in the private sector I’ve seen the best and worst of both systems of healthcare. The Choice program and it’s predecessor, the Triwest program, while occasionally useful in cases of extreme waits or patients in remote areas requiring services we’re unable to provide, effectively siphons attention and funds from the core capability of the VA Healthcare system and perpetuates the myth that VA Healthcare is incompetent. There is very little accountability within the Choice program in that referring clinicians are not able to vet contracted providers in the area leaving us often to deal with incompetent and often greedy contractors who are much more interested in turning a profit than delivering quality care. In most cases, contracted care costs the taxpayer more than if the same care were provided by VA clinicians. Veterans…and taxpayers, would be better served, long term, by adequately funding, expanding and staffing VA facilities to handle the increased workload.

  9. Sally Vrana MD says:

    Why don’t we fully support the VA? Some of the non-VA moneys, a great deal of it, could be used to strengthen VA programs. Some veterans are best served in community programs, but as a provider who both makes such referrals, and as a clinician involved with the authorization process, I know there’s more we could do at the VA, if we had full support to do so. This is undercutting the very excellent work we do here.

  10. Juliana Lucas says:

    I do not believe the expansion of choice will promote privatization of healthcare but feel it would enhance the services already provided. The government will still have to monitor the costs, the standards of care, utilization review, and case management these accounts to assure cost effective measures are utilized to save tax dollars and to monitor risk issues in order to assure patient safety issues.
    Hopefully though an insurance company who is already in the field could take over the contract since their company have the manpower to negotiate rates, monitor healthcare products and care, manage high risk patients, etc. without placing the burden back onto the VA staff.

  11. Eric P Cohen says:

    The current “CHOICE” program does not work well.
    It denies care by being cumbersome.
    The third party intermediary is ignorant and slow.
    Let’s go back to fee-service, using simple criteria and approval.
    At the same time, strengthen the VA. Better buildings, more doctors.

  12. robert w rosenbaum says:

    The program as I understand it would NOT lead to privatization but would in fact improve access and ease of access to needed specialty and sub-specialty health care especially in the rural and frontier areas of the country. Currently the VA healthcare system is antiquated, hard to negotiate around for patient and doctor, prolonging needed access to health care services.
    The system is really not flexible enough or maybe at all, to effectively provide for health care in a seamless and efficient fashion for both patient and providers.
    Providers should be able to access needed referrals just by requesting it and documenting the need for it and the patient should be able to receive it by having staff make the appointment without going through a mother may I system.
    Secretary Shulkin seems to comprehend the issues at hand for the VA Healthcare System and is willing to do something about it. I think he should be given the chance and supported by the congress. In my view, the ultimate relationship is between the patient, the VA system thru their provider and the private community when specialty care is needed.
    It would be very hard for each VA region to maintain a full service support facility and still be convenient for all veteran beneficiaries.

  13. Kin Snyder, MD says:

    It seems to me the best way to modernize the VA would be to have more Family Medicine and Internal Medicine doctors as PCP and allow them to refer patients out to local specialists if the services were not available in the VA within a 40 mile radius.
    Eliminate the Choice middleman administration and just pay the specialist out of the VA regular budget.
    Offer the same payment as the Medicare reimbursement rate and let the private doctors either accept that as full payment or reject that reimbursement and charge and collect what they wish with NO payment from the VA.
    Then eliminate all the extra costs associated with inefficient middle management, pay the PCP the average MGMA salary with no “performance bonus”, streamline the private physician reimbursement to a central billing/reimbursement office and make everyone happy.
    That is make the patients, the PCP, the VA staff, the private physicians happier even if the Choice contracting agent isn’t happy about losing the contract.

  14. Theresa Nieman, M.D. says:

    As government further expands services in the private sector, is this a progression toward the single payer healthcare system?

  15. Samantha Baab says:

    Privatization seems to be the go-to strategy for many politicians when, in fact, many government-sponsored programs came into being because the private sector failed to meet the public’s needs (e.g., Medicare, Medicaid).

    From the standpoint of a PCP, Veterans Choice has been a nightmare to deal with and, as its use has increased, local access to specialty care has diminished to levels lower than at the nearest VA with specialty care. (We do not have specialty care at our CBOC. However, our PCP wait times are generally under two days.)

    There will always be room for improvement at the VA, and there will always be “squeaky wheels” but rather than bash the VA (which is popular sport right now), I suggest to politicians that they talk to VA patients and providers to get a more balanced view of the health care our veterans are provided. Our veterans have services that, in most cases, surpass the care and access available in the private sector.

    Unfortunately, there does not seem to be an effective advocate for getting that word out, and the bashing continues. . .

  16. Glenda M. Patterson, MD says:

    I am concerned the care for Veterans is heading rapidly to privatization. Why is there such a disparity in the increase in funding between the private sector care and established VA facilities? How can the current deficiencies be corrected if funds are shunted to private sector care?

  17. Peggy Dalton says:

    No one plan will suit every veteran and every situation. I see both sides having good and bad points. I have used about a half dozen, and the frustrating part is the requirement to recertify, or do I miraculously become a non-veteran?

  18. Michael Brewer says:

    Wolf in lambs clothing. Been following Veterans Affairs since 1972. I know a thing or two. Trained VSO. Call the bluff, they want the VA software program, the rest is a ruse. Big Pharma wants this so bad they are salivating from breakfast to supper. The delay in the new Health Care Bill has a lot to do with back room deals with the future of the VA. MSM has not a clue. Mike/Retired Private Investigator for Bankruptcy fraud.

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