Issue Brief, July 2008

Veterans’ Health Care Funding Reform

 

 

 

• While great strides have been made to increase the level of the Department of Veterans Affairs (VA) health care funding during the past several years, there have been significant delays in receiving those funds. 

• Over the past six years, VA has not received its annual funding on average until more than three months after the start of the new fiscal year.     

• Unlike Medicare or Medicaid, VA health care must rely on Congress and the President to pass a new appropriations law each year that provides VA hospitals and clinics with the funding it needs to treat veterans.  

• Political wrangling has deadlocked the federal budget process, and in turn, the funding for veterans’ health care. 

• As a result, there have been continuing resolutions instead of regular approved appropriations bills; late-arriving final appropriations; offsets and across-the-board cuts; supplemental and even “emergency” supplemental appropriations requiring a Presidential declaration. These and other budget “gimmicks” have now become the norm rather than the exception.   

• Not knowing when or at what level of funding VA will receive from year to year – or whether Congress will approve or oppose the Administration’s proposals – hinders the ability of VA officials to plan their spending for the coming year.  

• Compounding the problem are the new demands placed on the VA system. Since 2001, the number of VA patients has risen by two million – a 50 percent increase. And our newest generation of veterans has increasingly complex mental and physical healthcare needs.  

• Reports by the VA Office of Inspector General (OIG) have shown that many VA hospitals across the country cannot accommodate the influx of patients in a timely fashion. For example, a recent OIG report from May 18, 2008 estimated that 28,000 veterans waited longer than 30 days for medical appointments from October 2007 to March 2008 at several VA facilities in New York and New Jersey.

• The Partnership for Veterans Health Care Budget Reform, a coalition of nine veteran service organizations, continues to support as one solution, legislation making VA health care funding mandatory. This would guarantee funding is available on time every year with adjustments to account for medical inflation and enrollment increases. To date, Congress has not shown much interest in moving this legislation forward. 

• As an alternative, the Partnership is now proposing that Congress change VA’s medical care appropriation to an advance appropriation, which would provide funding for veterans’ health care one year in advance. This would ensure funding is timely and predictable, without making it mandatory or requiring it to meet PAYGO rules. 

• If advanced funding were in effect today, the budget for fiscal year 2009 would already be in place and the budget for 2010 would be considered by Congress this year. 

• Unlike mandatory funding provided to Medicare and Medicaid, Congress would retain its discretion to approve funds and retain its oversight authority over VA funding. 

• Congress has exercised and continues to exercise its power to approve advance appropriation laws. Funding for the Low Income Heating Energy Assistance Program (LIHEAP), HUD Section 8 housing vouchers and the Corporation for Public Broadcasting are examples of current advanced appropriations. Veterans’ health care should be elevated to the same level.
  
• The Partnership’s new proposal would also require VA’s internal budget model to be shared publicly with Congress to provide accurate estimates for VA health care funding before political considerations take over the process. This would add transparency and integrity to the VA health care budget process.