When Congress passed a bill last year to transform the Department of Veterans Affairs (VA), lawmakers said they were getting rid of arbitrary rules for when the government would pay for veterans to see private doctors.
Under the old program, veterans could go to the private sector if they would have to wait 30 days or travel 40 miles for care in the VA. Lawmakers and veterans groups, including conservatives, criticized those rules as arbitrary. The new law, known as the Mission Act, was supposed to let doctors and patients decide whether to use private sector based on individualized health needs.
Recently, the Trump administration proposed new rules, known as access standards, to automatically make veterans eligible for private care. Instead of 30 days, it's 20 days for primary care or 28 days for specialty care. Instead of 40 miles, it's a 30-minute drive for primary care or a 60-minute drive for specialty care.
The announcement appeared to do little to settle the debate over whether the VA's rules are arbitrary.
"Twenty days is just as arbitrary as 30 days," Bob Wallace, the executive director of Veterans of Foreign Wars, one of the largest veterans service organizations, said in a statement.
What is clear about the new rules is that they are dramatically more permissive. The new drive-time standard alone will make 20 percent of veterans eligible for private primary care and 31 percent eligible for private specialty care, up from 8 percent for both kinds of care under the old program, according to a briefing document circulated on Capitol Hill.
"This is doubling down on the administrative rules such as drive times and wait times," says David Shulkin, the former VA secretary who was fired last year by President Donald Trump, in part over disagreements about this bill. "I was in favor of a system that was clinically based, that put veterans' needs first and allowed the right match of services. This is just changing and loosening the administrative rules."
VA spokeswoman Susan Carter declined to comment.
Last month, a ProPublica investigation of the private-care program that the administration is now expanding found overhead costs that were much higher than industry standards and comparable government programs. In response to the article, VA Secretary Robert Wilkie acknowledged that the agency was "taken advantage of" with these overhead costs and vowed to improve.
On the campaign trail, Trump presented himself as a champion for veterans, and as president he frequently boasts about what his administration has done for former service members. But at the same time, he has enthusiastically supported shifting more veterans to private medical care, over the objection of major veterans groups that want to preserve the VA's health system. He has also plunged the VA into chaos by upending his own leadership team at the agency and handing vast influence to three men nicknamed the "Mar-a-Lago Crowd" because they meet at the president's resort in Florida.
The new access standards are the most important step toward reshaping the VA in line with Trump's vision of enlarging the private sector's role.
"None of this should be a surprise to anybody: President Trump has made it clear from pretty much the moment he started running he wanted full choice," says Dan Caldwell, the executive director of Concerned Veterans for America, a political group that advocates for more private care and that is backed by the Koch brothers, the industrialists who have donated hundreds of millions of dollars to conservative causes. "This does get us closer to full choice. That's the model we want to get to."
The VA is planning to continue widening the access standards, dropping the wait time for primary care to 14 days in 2020, according the agency's briefing materials.
Already, according to the document, almost half of the VA's primary care sites (69 out of 141) have wait times longer than 20 days, meaning their patients could get private care. In gastroenterology, 81 out of 128 sites have waits longer than 28 days. But, the document cautioned, "This data is not reliable."
According to people present for briefings on Wednesday, congressional staff and veterans groups had a long list of questions that largely went unanswered by VA officials. Among them:
- How many more veterans will become eligible for private care based on the wait times standards?
- How does the software that the VA bought from Microsoft calculate drive times?
- How many more patients does the VA expect to choose private care?
- How many more private-sector appointments does the VA expect to pay for?
- How many more veterans will sign up for VA benefits, or use the VA instead of their other insurance coverage, now that they could see private doctors at no cost to them?
- How will the VA ensure, as required by the Mission Act, that veterans referred to the private sector can get appointments there sooner than they could in the VA? (The VA's briefing materials said average national wait times are higher than in the VA.)
"They just didn't provide a whole lot of answers to questions about the impact," says Carl Blake, Paralyzed Veterans of America's executive director. "The fact is it's going to open up eligibility. It's debatable whether there are adequate resources to do so. What won't be acceptable is for them to take money from other programs in the VA to pay for it."
The unanswered questions could dramatically change the program's cost. The official notice for the new rules on the website for the Office of Information and Regulatory Affairs says the "Anticipated Costs and Benefits" are "TBD." In Wednesday's briefings, officials said the new access standards will increase the agency's expenses by $2.7 billion to $3.1 billion next year and by $19 billion to $20 billion over five years, the people present said.
Lawmakers have cast doubt on the VA's cost projections. In a letter to Wilkie on Monday, 28 Democratic senators noted that officials had provided "widely varying and potentially contradictory" figures depending on the day.
"I don't know why they're not using the resources we used to model this," says Nancy Schlichting, the former chief executive officer of the Henry Ford Health System who led a congressionally chartered commission that in 2016 issued a report on the VA's future. The commission estimated that paying for veterans to see private doctors without a referral from the VA could increase costs by $96 billion to $179 billion a year.
"It's very, very unsophisticated, frankly," Schlichting says of the administration's proposal.
When debating the Mission Act, lawmakers relied on a projection by the non-partisan Congressional Budget Office that assumed the rate of veterans using the private sector would stay about the same. That assumption has now been blown up by the way the administration is implementing the law.
"Today's announcement hastily rolling out new access standards places core VA services and vital research programs at risk by shifting money towards care outside VA," House veterans committee chairman Mark Takano said in a statement on Wednesday, vowing to hold a hearing. "Today's announcement places VA on a pathway to privatization and leads Congress to assume the worst."
Wilkie had moved to pre-empt such criticism. "Some will claim falsely and predictably that they represent a first step toward privatizing the department," he said in a lengthy statement on Monday, two days before the news access standards were announced.
As evidence, Wilkie said appointments in the VA's health system have increased by 3.4 million since 2014 to more than 58 million in 2018. But his statement did not mention how much the VA's private-sector appointments have grown: more than four times as much. According to agency data provided to ProPublica, the VA's private-care appointments increased by 14.9 million since 2014 to 33.2 million in 2017. Private care accounted for 58 percent of the VA's total outpatient appointments in 2017, up from 33 percent in 2014, the data shows.
In developing these access standards, Wilkie relied extensively on Darin Selnick, who previously worked for Concerned Veterans for America, the organization supported by the Koch brothers. Selnick signed onto an infamous 2016 proposal to dismantle the VA's government-run health system. Selnick also worked closely with the trio of unofficial advisers known as the "Mar-a-Lago Crowd."
Selnick sat on the "executive steering committee" in charge of implementing the Mission Act and reported directly to Wilkie as a senior adviser, according to an organization chart obtained by ProPublica. However, when the VA presented a version of the same chart to Congress at a December hearing, Selnick's name was not there.
Lawmakers voted for the Mission Act with the understanding that access standards would automatically trigger private care for only a few kinds of services, such as lab tests, X-rays, and urgent care, the 28 Senate Democrats said. But now the administration is making the access standards apply to everything, a plan that ProPublica first revealed in November.
"This proposal risks needlessly siphoning away VA resources to private providers, which could irresponsibly starve excellent existing VA clinics and hospitals," Senate veterans committee member Richard Blumenthal (D-Connecticut) said in a statement on Wednesday.
Lawmakers and the public may not get more information about the how the program will be funded until the White House releases its budget for 2020. But officials have indicated they won't submit the president's budget to Congress on time, blaming the 35-day partial government shutdown. The shutdown did not affect the VA, but it did furlough staff in the Office of Management and Budget, putting the VA at risk of being late on the Mission Act regulations that are due in June, according to an agency report obtained by ProPublica.
The VA recently chose Optum, a division of UnitedHealth Group, to take over administering the new private-care program in most of the country. However, because the agency was late in awarding the contracts, Optum won't be ready to start when the new program is supposed to take effect in June.
In the interim, program will be run by TriWest Healthcare Alliance, the old vendor that charged unusually high fees. TriWest has also filed a formal protest challenging the VA's decision to hire Optum. The dispute will be adjudicated by the Government Accountability Office.