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Obama Drops Controversial Third-Party Billing Proposal for Veterans

Updated 6:57 p.m.
By Philip Rucker
President Obama today abandoned a proposal to bill veterans' private insurance companies for treatment of combat-related injuries after the measure prompted an outcry from veterans service organizations and members of Congress.

The proposal would have authorized the Department of Veterans Affairs to charge private companies for treating injuries and other medical conditions related to military service, such as amputations, post-traumatic stress disorder and other battle wounds. The measure was intended to save the VA about $530 million a year, but the administration's pursuit of third-party billing sparked resistance from leaders of powerful veterans groups, who met earlier this week with Obama.

In a statement released this afternoon, White House Press Secretary Robert Gibbs said the president has "instructed that its consideration be dropped."

"In considering the third party billing issue, the administration was seeking to maximize the resources available for veterans," Gibbs said. "However, the president listened to concerns raised by the [veterans service organizations] that this might, under certain circumstances, affect veterans and their families' ability to access health care."

Veterans groups said the policy would jeopardize the insurance benefits of veterans and their families and would be an abrogation of the government's responsibility to care for those wounded in war.

Sen. Patty Murray (D-Wash.), a senior member of the Veterans' Affairs and Budget committees who warned VA Secretary Eric K. Shinseki last week that Obama's third-party billing proposal would be "dead on arrival," issued a statement saying the president "did the right thing in dropping this proposal.

"Injured veterans and their families have already paid enough of a price, they shouldn't have to worry about the tab for service-related care," Murray said.

Gibbs said Obama wants to "continue a constructive partnership" with veterans groups and highlighted the administration's commitment to veterans. In his budget blueprint, Obama proposes the largest increase in the VA's budget in 30 years.

Paul Rieckhoff, executive director of Iraq and Afghanistan Veterans of America, was critical of the proposal and issued a statement today saying that the administration is "upholding our sacred trust with America's veterans. Veterans of all generations are celebrating this decision."

Posted at 6:00 PM ET on Mar 18, 2009  | Category:  Health Care
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Why does anyone think private insurance companies should voluntarily or involuntarily pay for something that the government is responsible for. The government is responsible because they sent the service people into harms way then they should pay the bill. The insurance companies, businesses and private citizens already pay for this through our taxes.

I also agree wit ha previous poster that this would may any veteran unattractive to employers or insurers based on their prior condition.


This idea was not conceived with the benefit of our veterans in mind. at least in the opinion of this ten year army veteran with no service related injuries.

Posted by: kharms1969 | March 24, 2009 10:36 AM

He should be ashamed for even speaking of doing something like that to our vets.. shame on Obama..and shame on his administration..

Posted by: Mrsowell | March 20, 2009 4:54 PM

My comment is for MadamDeb and others who proffered this idea:"But I wanted to clear up the other poster's misconception about the whole deal. The proposal was never about having the veteran pay for care out of pocket." I can't imagine what experience you've had with private insurance but assuming the veteran doesn't pay "out of pocket" is absurd and ignorant.
First, employees typically pay some portion of the monthly cost of their insuranced "out of pocket".
Second, most policies have deductibles which must be paid "out of pocket" prior to insurance kicking in.
Third, insurance rarely pays 100% of any doctor or hospital bill; most will pay 80% to 90% but the other 20% or 10% must be paid "out of pocket".
Fourth, all policies have a life-time maximum pay-out limit. If a soldier's injuries require six million dollars worth of care (not an unreasonable assumption these days) and his policy cap is at $5 million, the remainder would have to be paid "out of pocket".
This is the trouble with this type of thinking. Or better said, NOT thinking. It misleads the non-thinker/blind follower . . . . and it insults the rest of us.

Posted by: bwl8585 | March 20, 2009 8:51 AM

Keep in mind that during most of the campaign, we had a different world around us. Things have changed dramatically. I think the President is doing one of the things he said he would do, listen to a variety of ideas and see how they might work. If they won't work, they take them off the table. I don't want anything that might hinder veteran care so I think they have to think these things over and they have evidently done so. I am willing to give them a chance to keep trying to find the path to get the country on the right track. No one has the entire answer as this is an unprecedented time in our country. Nothing in our history has been quite like where we are now, even the great depression. There are similarities, but we have a much different world today compared to then. We need to hope for success and not listen to those who want the president to fail. His failure would be the countries failure.

Posted by: alaskan2 | March 19, 2009 2:12 PM

It seems to me this is a non-story. It sounds like Obama was collecting proposals about future policy. This was one in the collection bin. It was never proposed, and there is no reason to believe that it ever would have been proposed. However, it does give the chronically afflicted Obama Haters a reason to vent their spleen over the rest of us this Thursday morning.

Posted by: davie163 | March 19, 2009 9:14 AM

This man gives away Billions to Corporate scum and he has the nerve to think that he can shove the care of our heroes off on uncaring Insurance Companies? Sick man if you ask me. This guy has it right about this President

Posted by: Civil_War | March 19, 2009 1:04 AM

Thank God. That was the most ungrateful plan I'd ever heard of. I just met an 82-year old veteran of the Korean War last week dying of cancer, and the VA told him he was too expensive to continue supporting, and it would be up to private insurance companies to determine his fate. Needless to say, the private insurers would only pay for half-@$$ed procedures and got their own docotors to down-play his problems so they could cop-out on the medical bills. The whole idea that single-payer health care won't be as good as private insurance is a scam. Whether it's the government or Pacificare, someone's going to be trying to save a few bucks by denying people treatment. However citizens have more control over the government than we do over private business.

Oh yeah, and if poor people could get health care which included comprehensive substance abuse rehabilitation, our crime rate would be reduced by 80%. That's another story, but I had to throw it in anyways.

Posted by: Terrorfied | March 18, 2009 11:11 PM

Don't think this proposal will go away for long. It will reappear in some underhanded manner as an add-on to some obscure bill.

In the TARP bill in October, the dems tried to include a provision giving $5 billion to ACORN. When it was discovered it was removed and the TARP bill was signed. It last month's stimulus bill ACORN received $4.7 billion.

They are trying to do the same with National Health Care and Cap and Trade. Rather than debating these very controversial and outrageously expensive issues on their own merits, the dems are trying to slip both into the budget reconciliation bill as add-ons.

Posted by: ickkbod | March 18, 2009 10:42 PM

Ironic that Obama told veterans' representatives about this idea shortly after Michelle disingenuously paid a visit to military families. Sounds like Michelle was a decoy.

Yeah, he screwed up and admitted it. But it should never have been considered in the first place. Big, big mistake.

Posted by: Darlene_Jr | March 18, 2009 10:37 PM

I find it unconscionable that our elected officials even thought about implementing such a policy!
Perhaps beyond this insult to our veterans of the Armed Forces, the underlying message that this ill advised proposal conveys is very disturbing indeed! A really "neat" recruitment incentive!!

RJK

Posted by: rjksjk | March 18, 2009 9:59 PM

Get a grip people. Obama goofed. But he admitted his mistake and dropped it, which is more than Dubya/dick ever did. I suggest you do the same.

Besides, he only asked private insurers to pay for VA hospital bills. Dubya/dick caused those hospital bills.

So if you want to crucify anyone, go after Dubya/dick for lying us into an illegal, immoral, imperialist, genocidal war OF terror to steal oil and U.S. tax dollars through contract fraud.

Oh, and let's not forget the soldiers who ended up in the VA hospital because of dick Cheney's Halliburton contract fraud.

Posted by: kevinschmidt | March 18, 2009 9:12 PM

SwellLevel5, I am not and could never be in favor of such a program. In fact, I posted at DKos yesterday, and sent to the White House, a comment that Lincoln made the promise “to care for him who shall have born the battle, and for his widow, and his orphan.” This is also in the VA's mission statement. My spouse is a 100% disabled veteran and I depend on the VA for my own medical care. But I wanted to clear up the other poster's misconception about the whole deal. The proposal was never about having the veteran pay for care out of pocket.

So Obama's dropping that item from the proposed budget is a very good thing, which means that he listens and can respond to real concerns, unlike almost anyone in the Bush administration. And it's also good to see that the Pentagon will pay for deceased soldiers' families to travel to Dover to receive their loved one.

So don't get me wrong. I voted for Obama, but I understand exactly what you're saying. Even though he's pulled back on the proposal, this will be fodder for the wingnuts for months or even years. It was a mistake, but is no longer an issue.

Posted by: MadamDeb | March 18, 2009 9:12 PM

"Dumbo wanted to make injured veterans pay health care for themselves, while his stimulus bill covers health care for illegal immigrants. Bring back Bush, PLEASE!"

What a moronic statement. Nobody ever suggested making veterans pay for themselves. All they suggested was that, after treating veterans, the VA could try in some cases to get money back from their insurers. If the insurer said no, the VA wouldn't get their money but the vet would still have been treated free.

There were reasons why this was a bad idea. First, it makes veterans slightly less attractive to employers, who might have to pay higher premiums for sick vets in their employ. Second, it was politically dumb because it's easily exploited by the thought-leaders of kneejerk dunces who never read below the headline.

But making vets pay for their own treatment? Don't be stupid. At least try not to be.


Posted by: kevrobb | March 18, 2009 8:57 PM

Madamdeb....what you don't understand is the insensitivity and arrogance of it all. While saving $500 million is nothing to sneeze at, pissing off millions of veterans (and poisoningn the relationship almost from the start) was just plain stupid.

Arrogance and Ingnorance is a deadly combination...just ask George Bush.

Posted by: SwellLevel5 | March 18, 2009 8:24 PM

With every passing day, I have come to realize that this guy is really in over his head. He may be very intelligent, but he isn't very smart.

Posted by: SwellLevel5 | March 18, 2009 8:21 PM

I apologize to everyone for voting for this dumbass.

Posted by: georgejones5 | March 18, 2009 8:16 PM

For poster pgr88's benefit, Obama wasn't trying to get veterans to pay for their own health care. If they had private insurance (through a spouse, for example), the plan was for the VA to bill the insurance companies for service-related issues, a very bad idea. They evidently already do this for non-service-related conditions. But if you don't have private insurance, none of this would occur. The VA will take care of the veteran entirely. (I don't know how you can misunderstand the proposal when all you had to do was read the article you're commenting on.)

Posted by: MadamDeb | March 18, 2009 7:56 PM

Good riddance!
This was an idea that was "on the table", as was taxing insurance benefits. McCain had the latter as his actual plan, not just "on the table".

Now, how about kicking the conflicted interests of private health insurance to the curb, and go about creating the new gold standard of single-payer healthcare systems?

The majority of Americans want it, especially the MAJORITY OF PHYSICIANS. Lobbyists and advertisers (who pull media strings) don't care what we want.
http://www.pnhp.org/

Posted by: rooster54 | March 18, 2009 7:25 PM

Obama is turning out to be very inexperienced like D.C. Mayor Adrian M. Fenty. I wasn't a supporter of John McCain or Barack Obama on the issue of illegal immigration. Too many black voters think Obama is the Messiah. They will be disappointed in him as time goes on.

Posted by: Ward4DC | March 18, 2009 7:19 PM

Dumbo wanted to make injured veterans pay health care for themselves, while his stimulus bill covers health care for illegal immigrants.

Bring back Bush, PLEASE!

Posted by: pgr88 | March 18, 2009 7:08 PM

Obama is still getting in the swing of things, and the public is strongly behind him. His decision will help more vets get the health care everyone in our nation deserves. Veterans everywhere are celebrating his decision, they deserve this bit of good news for serving our country. This will probably strengthen Obama's image for the better, with the veterans to say the least.

Posted by: ralphbray | March 18, 2009 7:06 PM

Good. That was one of the more spectacularly stupid ideas out of this very disappointing administration.

It was the height of hypocrisy for the Obamas to talk about how much they appreciate "the troops" while preparing to shaft them--almost as bad as hypocrisy and duplicity of the Bush administration towards soldiers and veterans.

For all the promises of change, we're just seeing business as usual. The only differences between Obama and Bush are that Obama is more articulate, is not overtly threatening, and does not have a thug as a vice president.

The Obama administration, after two months, is flailing. The incompetence certainly hasn't changed from one administration to the next. Or the kowtowing to the rich, powerful, and corrupt. Or the deafness to the concerns of American taxpayers.

At a time when a drastic overhaul of the laws regarding financial transactions and the system is needed, Obama chose Larry Summers and Tim Geithner as his economic point men--two people who are deeply invested in the status quo--one of whom, at least is a tax cheat.

I contributed a great deal of money to Obama's presidential campaign because I believed he might be different. I wasted my money. It is only a slight comfort to me to reflect that neither Hillary Clinton nor John McCain would have done a better job.

Posted by: nicekid | March 18, 2009 6:50 PM

This proposal from the administration that said it would take care of the vets and not let the things happen in the Bush era? If Bush had suggested such a thing the media would have busted a nut!

Posted by: casadeloro | March 18, 2009 6:48 PM

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