External Economic and Policy Changes Influence Use of VA Services

Posted on: August 6, 2018 Topics: affordable care act, affordable housing, medicaid, politics and health, veteran health, veterans

The use of US Department of Veterans Affairs (VA) services is affected by economic and policy changes outside the VA, such as Medicaid eligibility, private employer insurance coverage, unemployment, and non-VA physician availability, according to a new study led by School of Public Health researchers.

The study, published in Health Services Research, found Medicaid expansion following the Affordable Care Act was associated with a 9.1 percent reduction in VA healthcare utilization in the expansion states, amounting to $833 million less in VA spending.

“As most veterans live and work in community settings, the choice to use VA healthcare services is likely influenced by factors both internal and external to the VA,” says lead author Amresh Hanchate, a health economist at VA Boston Healthcare System, associate professor of medicine at the School of Medicine, and associate professor of health law, policy & management at SPH. “Thus, a better understanding of how these factors influence the choice of VA healthcare services is important for VA’s continued ability to meet veterans’ healthcare needs.”

The researchers examined VA healthcare enrollment and utilization from area-level data on Medicaid policy, unemployment, employer-sponsored insurance, housing prices, and non-VA physician availability. Using VA data, they identified more than 8 million veterans, aged 18 and older, who had either received or were enrolled to receive VA health care during 2008-2014.

Medicaid expansion following the Affordable Care Act was associated with a 9.1 percent—or $833 million—reduction in VA healthcare utilization in the expansion states. Among veterans aged 18-64, a 10 percent increase in unemployment was associated with 0.65 percent increase in VA healthcare utilization, while a 10 percent increase in private employer-sponsored coverage was associated with a 1.4 percent decrease in utilization. Among all veterans, increases in non-VA physician availability and housing prices were associated with an increase in utilization. Among veterans aged 65 and older, a 10 percent increase in housing prices was associated with a 2.2 percent increase in VA healthcare utilization.

“Our study estimates indicate that the VA utilization change associated with individual external factors is likely small, but specific regions and large policy changes can have a substantial effect,” Hanchate says. “Changes in alternative insurance coverage (Medicaid and private) and other external determinants may affect VA healthcare spending. Policymakers should consider these factors in allocating VA resources to meet local demand.”

The study was co-authored by Austin Frakt, associate professor of health law, policy & management; David Mohr, research assistant professor of health law, policy & management; and Steven Pizer, associate professor of health law, policy & management. The other co-authors were Nancy Kressin and Amy Linksy of the School of Medicine and the VA Boston Healthcare System; Hassen Abdulkerim and Kelly Stolzmann of the VA Boston Healthcare System; and Amal Trivedi of Brown University and the Providence VA Medical Center.


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