VA Scandals Raise The Specter Of Healthcare Rationing

Elizabeth Price Foley Law Professor, Florida International University
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Whistleblowers within the Veterans’ Administration health system are coming forward with tales of brutal disregard for the health and life of those who served our country. Allegations of extensive wait times for lifesaving care, deaths while waiting, and horrific mismanagement have triggered outrage.

Unfortunately, the VA abuses are just the tip of a much larger, more menacing iceberg. The iceberg is covert health care rationing, and it’s inherent in single-payer systems like the VA.

The obvious question to ask about the VA scandal is: Why? Why would a VA hospital administrator direct doctors not to perform colonoscopies until patients had three positive tests for bloody stools? Or why were VA employees ordered to “cook the books” and hide long wait times that veterans faced when seeking care from heart, cancer, or other specialists? Why did some VA administrators go so far as to create a secret waiting list to hide year-plus wait times?

There’s only one plausible answer to these questions: rationing. The VA is but a smaller version of the sort of government-run, single-payer health care with which the political left is so enamored.

When individuals receive care through the VA, it becomes the only payer and hence, the only decision-maker. The VA decides who gets care, when, and how much. Moreover, as the single payer, the VA bears the risk of loss: If tax dollars aren’t enough to pay for the care demanded, there’s only one result — rationing of care.

Rationing care can take many forms. It can be overt, like the Canadian or British health care systems, which have unambiguous, publicly-announced waiting times and coverage denials for certain procedures. Or rationing can be more subtle, with little or no public participation. This latter, covert form of rationing is what the VA has adopted.

Covert rationing appears to be the only form of rationing that’s politically palatable to Congress. Another example is the Independent Payment Advisory Board (IPAB), the so-called “death panel” created by Obamacare. Congress charged IPAB with cutting Medicare spending below certain levels, without reducing Medicare benefits or increasing beneficiary cost-sharing.

The only way to achieve IPAB’s lofty goal, as Congress surely understood, is to reduce payments to hospitals, doctors, and other health care providers. As providers make less money per patient, there will be fewer providers willing to accept Medicare beneficiaries, and waiting times will inevitably rise. Increasing waiting times, as VA executives well know, is a subtle but effective form of rationing.

Many on the political left argue that since tax dollars for health care are limited, rationing is inevitable, so we shouldn’t worry too much about what form it takes. If everyone has access to health care, the argument goes, it doesn’t really matter that some are getting less overall care. Don’t fall for this straw man.

While it’s true that health care demand always outstrips supply, this concession doesn’t imply that government-run, single-payer health care is inevitable, or a good thing; quite the contrary. The abuses experienced in the VA system are endemic to all single-payer systems.

When government has a monopoly on the provision of health care, patients lose. They lose because they cannot escape. They have no viable alternative choice.

Reining in rationing — particularly the more nefarious, covert kind — isn’t possible in a single-payer system. If the monolithic single payer is inefficient or poorly managed — as is generally problem with government, not just the VA — it will face severe pressure to ration, and keep such rationing quiet, to save face. There won’t be any public debates about whether this procedure or that procedure should be covered. Those debates are too politically charged. So in this country, government-run, single-payer systems will ineluctably lead to secretive, under-the-table rationing by unelected, politically unaccountable bureaucrats more interested in saving their own hides than in patient care.

If we want to reduce covert health care rationing, the answer isn’t single payer. It’s injecting more competition into health care delivery, expanding consumer choice, and forcing an array of payers to compete based upon fully-disclosed coverage levels and price.

When there are multiple payers, patients can vote with their feet. If they don’t like a particular insurer’s coverage or charges, they can switch insurers. Unfortunately, most of the men and women who sought care from the VA didn’t have this option, and many paid the ultimate price because of it. Steadfastly rejecting single-payer, and supporting more competition in health care, is the way to avoid VA-type covert rationing scandals in the future.