Veterans Hospitals Rake It In System Doesn’t Share The Pain Of Budget Cuts

At a time when the federal government is driving down the cost of health care and forcing hospitals across the country to close, the Department of Veterans Affairs keeps expanding its own hospital system, the nation’s largest, and spending more for health care.

Government reports call the Veterans Health Administration a bloated bureaucracy, with surgeons who have gone a year without lifting a knife, and rife with wasteful practices such as admitting clients to hospitals for conditions that outpatient clinics everywhere else treat in an hour or two.

A quarter of the beds in the department’s 173 hospitals stand empty as surviving soldiers of World War II move into their 70s and 80s and the veteran population shrinks. There are 26 million veterans now, down from 30.1 million in 1980.

Yet, in Washington’s battle over the 1996 budget, President Clinton has proposed an increase of more than $700 million for the Veterans Health Administration, mostly for construction, and the Republicandominated Congress has approved an increase of $400 million.

At the same time, Medicare, the government insurance program for the elderly, and Medicaid, the program for the poor, face sizable cuts in projected spending.

VA jobs have grown with the spending. The federal work force has shrunk 8 percent, to 2 million, since the Clinton administration took office through September, according to the Office of Personnel Management. But the VA work force has climbed 1.4 percent, to 264,000.

The veterans hospital system bucks the trends in health care because no one can touch it politically. Clinton, denounced by many veterans for avoiding the Vietnam War draft, has bent over backward to court them.

Members of Congress, sensitive to jobs the hospitals provide in all 50 states, recoil at shutting one in their own. And lobbies such as the American Legion, the Disabled American Veterans and the Veterans of Foreign Wars boost the interests of veterans unchallenged by other groups.

VA officials themselves say they have too many hospital beds.

“Every place is over-bedded,” said Kenneth W. Kizer, the department’s undersecretary for health, who is attempting to reorganize the system. Kizer said he also is cutting his headquarters staff to 600 from 802.

But he blames Congress for some of the redundant capacity and for writing some of the regulations that discourage the department from turning to less expensive outpatient care, a development that is changing the American hospital system.

“People are admitted to hospitals who don’t have to be admitted,” he said. “But the only way they can be treated is to be admitted.”

Officials in Congress acknowledge the political difficulties of cutting the budget of an agency that serves the nation’s veterans, even at a time when they are struggling with some of the deepest budget cuts in history.

“You mention the word ‘veteran,’ and you’re supposed to pitch forward on your sword,” said Sen. Alan K. Simpson, R-Wyo., chairman of the Veterans Affairs Committee.

He said no one begrudges a battle-scarred infantryman a lifetime of medical care, a disability check and a pension for him and his widow.

But the veterans lobbies “raise tremendous amounts of money,” Simpson added. “They tell their public this Congress doesn’t care about their vets. I’m a veteran. If I weren’t, they’d have cremated me by now.”

Veterans groups forced Edward J. Derwinski to resign as President Bush’s secretary for veterans affairs in 1992 after he suggested admitting non-veterans to a few under-used VA hospitals.

“With welfare, abortion, gun control, the death penalty,” Derwinski said, “you’ve got legitimate pro and con positions. But there’s no anti-vet lobby. No one’s going to come in and say, ‘Don’t waste any more money on veterans.”’

With its network of hospitals and more than 500 clinics, nursing homes and other facilities, including about 20 golf courses, the Department of Veterans Affairs runs the nation’s largest health system.

That system, which cares for about 2.6 million veterans, is in line to receive $16.6 billion in fiscal year 1996. In contrast, said a Senate aide who specializes in veterans affairs, the Department of Defense spends about half as much for the care of 8 million soldiers and dependents.

In defense of the system, veterans advocates say the budget, while growing, has fallen behind the pace of rising health care costs and that veterans, while declining in number, are reaching ages when they need two and three times more care than they did in their 30s and 40s.

The advocates say fewer hospital beds would be empty if the government relaxed eligibility rules for free care. All veterans can use the hospitals, but just 10 percent do, mostly those whose expenses are paid.

To qualify for free care a veteran - anyone who has served at least 180 consecutive days in the armed forces - must earn less than $20,469 or be deemed at least 50 percent disabled by injuries or diseases contracted in the service.

In spite of the declining number of veterans, the department shut only two hospitals since the 1960s, both in California and both because of earthquakes.

The Veterans Health Administration is expected to receive at least $400 million, or 2 percent, more in the fiscal 1996 budget than it was granted in 1995. Since 1990, spending on health care for veterans has risen 43 percent, four times the pace of all other spending whose levels are set by Congress or the Clinton administration.

Yet in audits, both the General Accounting Office and the department’s own inspector general have raised fundamental questions about the department’s health care mission and management.

In a look at six hospitals, in 1990, the inspector general found that 21 of 131 surgeons “spent no time in the operating room at all during the year.” Four years later, in an audit of three other hospitals, it found that 13 of 79 surgeons went a year without lifting a knife.

By dwelling on building and renewing hospitals, the reports showed, the VA resists the trend toward outpatient care and keeps patients in hospitals much longer than community hospitals do.

The department’s annual report for 1994 shows a 17 percent increase in outpatient visits from 1987 to 1994. But over the same period, outpatient visits in the private sector jumped about 50 percent.

Part of the problem is regulations like those that require hospital stays for many procedures, including cataract operations, that are routinely performed by outpatient clinics in the private sector. Kizer said such regulations even apply to giving a patient a pair of crutches.

“A patient comes in with a broken ankle,” he said. “It is casted in the emergency department. He needs crutches. Well, crutches are called a prosthetic device. Prosthetic devices are only given on an inpatient basis. So he has to be admitted to the hospital. Every place else in the world just gives him a set of crutches and lets him go home.”