• Trump, Privatization, and the Passion of Veterans Affairs Secretary David Shulkin

    April 15, 2018 // 28 Comments »

    As some seek to further privatize veterans health care, with hundreds of billions of dollars at stake, sacrifices will have to be made. Let’s hope few fall on the veterans themselves.


    Former Veterans Affairs Secretary Dr. David Shulkin once held the title of least controversial Cabinet secretary in the Trump Administration. He was confirmed in the Senate by a vote of 100-0, and for most of his time in office enjoyed broad bipartisan support as he sought to reform veterans’ health care.

    That all changed for the lone Obama Cabinet holdover when Donald Trump sacrificed Shulkin on March 28 in favor of White House physician Rear Admiral Dr. Ronny Jackson. Though pushed out ostensibly over a damning ethics report, Shulkin’s story is really one of whether or not further privatizing health care for veterans is the right way to fix a damaged institution. Shulkin being pushed out is a big story that has been both understated and oversimplified in the press as mostly just another episode of the Trump chaos soap opera.

    Shulkin himself pulls no punches. “I believe differences in philosophy deserve robust debate, and solutions should be determined based on the merits of the arguments. The advocates within the administration for privatizing VA health services, however, reject this approach,” wrote Shulkin after his dismissal. “They saw me as an obstacle to privatization who had to be removed. That is because I am convinced that privatization is a political issue aimed at rewarding select people and companies with profits, even if it undermines care for veterans.”

    Despite the quick-fix appeal of privatization in the face of a VA clearly not meeting fully the needs of its population (Shulkin took over the VA in the wake of a report citing a “corrosive culture that has led to poor management, a history of retaliation toward employees, cumbersome and outdated technology, and a shortage of doctors, nurses and physical space to treat its patients”), is a system morphing toward “Medicare for veterans” the answer?

    In its simplest form, privatization means that instead of seeking care at a VA facility at little-to-no charge, veterans would be free to visit any health care provider in the private sector, with Uncle Sam picking up most of the tab. The VA would shift from directly providing care in its own facilities to become the insurance company of dreams. In many cases long waits to access a VA facility would diminish, veterans in rural areas would most likely have less of a travel burden, and patients could better match their needs to a provider. The latter could be especially important to LGBTQ veterans. It’s hard to argue against choice.


    The issue is money. According to one report, moving vets to private providers would double spending in the immediate term. By 2034, the cost of VA health care could be as high as $450 billion, compared to a baseline of less than $100 billion. And even those numbers may be too low; as Vietnam-era vets require more expensive end-of-life care, and as waves of veterans from the past 17 years of the War on Terror enter the system, costs will rise. The challenge is clear; between 2002 and 2013, the number of annual VA outpatient visits nearly doubled to 86.4 million. Hospital admissions — the biggest driver of costs — rose 23%.

    Under any calculus veterans health care is big money and proponents of privatization want to pull as much of it as possible into the commercial sector. But where would the money come from? Major veterans’ organizations opposing additional privatization worry disability benefits and other core VA programs such as education would be cut back. Others speculate a privatized VA system would quickly go the way of civilian insurance, with limited networks, increased co-pays, and complex referral systems, all as a way of passing increasing costs on to the patient. As for many under Obamacare, vets would be caught in the gap between being able to have insurance, and being able to afford health care. Choice can come at a price.


    The specialized needs of many veterans are part of the reason for the specialized veterans’ health care system. Despite much justified criticism, the VA serves the needs of many of its patients well. In the critical area of psychology, VA performance was rated superior to the private sector by more than 30%. Compared with individuals in private plans, veterans with schizophrenia or major depression were more than twice as likely to receive appropriate initial medication treatment. RAND concluded separately “the quality of care provided by the VA health system generally was as good as or better than other health systems on most quality measures.”

    The VA also has expertise in prosthetics, burns, polytrauma, and spinal injuries rare in civilian life. The VA has a lifetime relationship with its patients, leading to broader implementation of preventive care and better integration of records. These advantages could be lost as more choice under a largely privatized system could result in significantly less choice at the VA in areas where it matters most.

    The risk is throwing out the baby with the bathwater, as increased privatization will inevitably mean shuttering some VA facilities. The solution lies in a system which pairs the best of privatization with a reformed government-run veterans health care system. Paring off some services into the private sector while retaining those unique to the VA, all to the satisfaction of Congress, demands an administrator with extraordinary bureaucratic skills. The Trump administration was very likely wrong when it decided Shulkin was not that man.

    Though painted as a solid opponent of privatization, as he was fired Shulkin was already pushing the VA to further privatize its audiology and optometry programs. He oversaw change that led to 36% of VA medical appointments being made in the private sector. Shulkin’s Veterans Choice Program (VCP) allowed access to private doctors where the VA couldn’t provide specialized care, when wait times exceeded standards, or when travel to a VA facility represented a hardship. Shulkin was advocating for the program’s expansion when both his funding and his tenure ran out.

    The VCP program was consistently underfunded, in part due to the unpredictability of month-to-month expenses that will plague any privatized system. However, some of the underfunding was political; one holdout was Senator Jerry Moran. Moran wanted the program tapered off in lieu of his own bill calling for the greater leaps into privatization Shulkin remained skeptical of.

    As Department of Veterans Affairs Secretary, Dr. David Shulkin was an experienced medical administrator who had specialized in health care management at some of the nation’s largest hospitals. The new secretary nominee, Dr. Ronny Jackson, is a fine Navy doctor who has served two presidents, but comes to the job with no experience with an organization the size and complexity of the VA, already the government’s second-largest agency.


    Questions will be asked at what will no doubt be contentious confirmation hearings about whether Jackson can rise to the challenge, or if privatization advocates will take advantage of him to rush ahead with their own preferred changes, to their own financial gain.

    Hanging in the balance? Nine million veterans who rely on the VA for life-sustaining care in return for the sacrifices they have made.




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    Posted in Other Ideas, Trump

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