Horowitz: Congress Rushing Through Massive New Healthcare Entitlement Before August Recess

Horowitz: Congress Rushing Through Massive New Healthcare Entitlement Before August Recess

In a classic Washingtonian political maneuver, both parties are prepared to introduce a massive new Veterans Affairs health care entitlement and force members to vote up or down on the entire package before they hustle off to their awaiting flights home for the August recess. While containing one or two good proposals, the Sanders-Miller conference agreement will create a new entitlement, possibly as big as Medicare Part D, without addressing the fundamental problems with the VA that are short-changing our veterans. Most of the funds will be designated as “emergency spending,” which will exempt it from the requirement for offsets.

Much like most crisis-driven pieces of legislation, this bill sounds good on the surface. It would authorize $5 billion for hiring of additional staff and almost $2 billion for construction of 27 new facilities. The bill would also spend $10 billion granting veterans the option to seek care at private facilities, for those who are 40 miles away from a VA system or for those who have waited in line without getting an appointment for 30 days. $5 billion of the spending would be offset with other cuts to the VA while the rest of the tab would be exempt as emergency spending.

Here are some of the core concerns with the bill:

  • It’s Policy, not Funding: Like most public policy problems, the crisis within the VA does not stem from the lack of funding; it is rooted in the systemic problems with government-run health care. Total VA spending has increased by 56% to $152 billion since 2009, yet the crisis has only gotten worse. Also, as Senator Tom Coburn (R-OK) noted, over the same time period the number of VA full-time physicians increased 40%, even though the number of patients only grew by 13.8%. Tossing another $10 billion into the same failed system in order to hire more employees will not ameliorate the inherent fatal flaws and lack of innovation of government-run healthcare.

  • Muddled Private Option: While conservatives have long advocated for a private option, this bill does not achieve privatization, and in fact, might encumber veterans with even more bureaucracy. Rather than fully paying the premiums of veterans so they can purchase private insurance and seek care anywhere in the country, this bill would allow limited care in the private market, but under the auspices of the current VA system. So instead of their private insurance provider (paid-for by government, of course) reimbursing the healthcare provider, the VA would reimburse them under a new “Medicare SGR” style formula. Remember, this will not be replacing the VA, it will be added on top of an expanded VA.

  • Long-Term Cost: The $17 billion price-tag is just the short-term cost. They plan to ram this through without a CBO score on the long-term effects. This is not a one-shot deal. They are creating a new Medicare-like program on top of the massive expansion of the VA itself. The CBO score on the original Senate bill predicted that the new entitlement would cost $50 billion per year, approaching the size of the Medicare Part D program. The conference bill caps spending at $10 billion per year, but this is even worse in some ways. CBO projected that the new “private option” would expand enrollment in the VA by 8 million and cause the current 8.4 million enrollees to increase use of VA benefits by 75%. There is no way they can implement this system and cap spending without leading to rationed care and without dissuading healthcare providers from participating in the program. Clearly, we will be dealing with the deleterious effects of this bill for years to come, much like we are compelled to enact a Medicare doc fix every year.

House leadership posted this bill at 11:45 p.m. last night just so they can say members had three days to read it by the time it comes to the floor on Wednesday. It is simply absurd that Congress would ram through such a bill just to get home without thinking of the long-term consequences.

The political class plans to shout “veteran” and “emergency” in a crowded room of anxious politicians eager to get home for recess, and come away with another government-run health care program in a matter of just three days. This is what is wrong with Washington.

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