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Report by Congressional Watchdogs Highlights VA Strengths

January 9, 2008

CBO Credits Performance Measurement and Technology

WASHINGTON – The health care system of the Department of Veterans Affairs (VA) received a highly favorable review in an interim report recently published by the Congressional Budget Office (CBO).  The report credits organizational restructuring and management systems, performance measurement and information technology (IT) as contributors to VA's success.  It also outlines ways in which VA can continue serving as a model for other health care systems.

“It is gratifying to receive such a positive appraisal from CBO,” said Secretary of Veterans Affairs Dr. James B. Peake. “It is a tribute to the men and women of VA who have worked hard to ensure America’s veterans receive world-class health care.”

The interim report is featured on CBO's Web site at www.cbo.gov *.  The final report, expected in early 2008, will address the potential for other public and private health care systems to apply similar approaches and other issues.
The report, completed at the request of the chairmen of the House Committee on Veterans’ Affairs and the Subcommittee on Military Construction, Veterans Affairs, and Related Agencies of the House Committee on Appropriations, reviews the quality of VA’s health care, examines VA’s achievements and looks at lessons learned from both its management initiatives and application of information technology.

Key factors cited in the report included VA’s restructuring efforts to permit more shared decision making between VA’s central office, regional managers and facility directors; measuring performance, process and outcomes; and system-wide use of health information technology.

The improvement in VA’s health care quality in recent years has been well-documented in a number of independent studies including those by the Institute of Medicine (IOM).  VA’s accomplishments are all the more noteworthy as they came during a period of increased demand for services.

From 1999 through 2007, enrollment in the VA health care system, mandated by the Veterans’ Eligibility Reform Act of 1996, swelled from just over three million to nearly eight million veterans.  Consequently, the number of veteran patients treated each year increased from approximately 3.2 million to more than five million.

The CBO report pointed to VA’s structure as an integrated health care system that allows the use of two important tools: incentives given to managers and providers to meet quality of care and practice guideline targets; and health IT systems that provide reminders about tests and treatments recommended by the practice guidelines.  It also examined the low cost of care for veterans as an incentive for seeking care.

VA has an electronic health record for every patient, which provides up-to-date information about a patient at the point of care, including his or her history, allergies, and medications.  It also consists of relevant diagnoses and laboratory tests, enabling providers to avoid duplicate tests and adverse drug interactions. Research indicates that computer reminders and prompts can significantly improve adherence to clinical guidelines, particularly for preventive care.

The CBO said that VA’s integrated structure and appropriated funding may have helped VA focus on providing the best quality care for a given amount of funds as contrasted to fee-for-service incentives toward billable services and procedures. These and other issues will be addressed in the final report.

VA is the second largest cabinet department, with about 250,000 employees, a health care budget last year of $32 billion and an overall budget exceeding $82 billion.  VA will provide care to more than 5.8 million veterans this year in its 153 hospitals and nearly 900 clinics.  VA also provides disability compensation and pensions to 3.5 million veterans and family members, and operates 125 national cemeteries.

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