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Does The Government Run Health Care Better?

Health-care bloggers Merrill Goozner and Joe Paduda are talking about one of my favorite ideas: expanding the Veterans Health Administration to non-veterans. To understand why this would be a good idea, read Phil Longman's definitive article on the subject.

I've been thinking of writing a really long post along these lines, but the short version is this: If you crudely ordered America's different health-care systems from least government control to most, it would look something like this: individual insurance market, employer-based insurance market, Medicare, Veterans Health Administration (Medicare is single-payer, but VA is actually socialized medicine, where the government owns the hospitals and employs the doctors).

If you ordered America's different health systems worst-functioning to best, it would look like this: individual insurance market, employer-based insurance market, Medicare, Veterans Health Administration.

That symmetry should get more attention in the health-care discussion than it does.

By Ezra Klein  |  June 3, 2009; 6:18 PM ET
Categories:  Health Reform  
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Metrics, please.

Posted by: bluegrass1 | June 3, 2009 6:26 PM | Report abuse

Chomsky says Australia has a better system than Canada but I can't find anyone commenting on that.

Posted by: par4 | June 3, 2009 6:50 PM | Report abuse

The VA is an excellent example – probably the best in America – of a very cost effective medical system delivering first rate care. There is pretty good evidence, both from the VA and from overseas, that nationalized health systems are the cheapest way to run effective health care.

However, the major obstacle to creating a VA type system for all Americans, or even for all Americans who would be interested, is the extremely high initial cost due to creating or buying the infrastructure needed to run the system. The cost of converting the entire American health care system to a nationalized health service would run into the hundreds of trillions of dollars – the value of our existing health care infrastructure now.

That is the reason that no non-communist developed country has started a nationalized system since Britain did it in the 40’s. Every other system has opted for variations on single payer or on social insurance programs, which leave the infrastructure as is.

Posted by: PatS2 | June 3, 2009 6:56 PM | Report abuse

I thought the VA was having significant issues treating the vets wounded in Afghanistan and Iraq?

Posted by: anne3 | June 3, 2009 7:11 PM | Report abuse

Frankly, Ezra, you lose a lot of credibility if you say that VA hospitals are any good, let alone the best in the nation. I have a couple of friends who spent part of their training at VA hospitals (in different states), and both feel that the entire VA system is absolutely atrocious -- orders of magnitude worse care than is available in any other hospital. The stories they told of staff indifference and incompetence were absolutely stunning. I was warned to never, ever seek care at a VA hospital.

(And I say this as someone who supports universal health care.)

I'm curious how you came to a different conclusion. Perhaps you're only talking about the payment system, not the quality of care.

Posted by: davestickler | June 3, 2009 8:13 PM | Report abuse

davestickler: Check out this article Ezra wrote in 2007. Skip to the section on the VA if you like. That should answer some of your questions:

Posted by: Castorp1 | June 3, 2009 8:34 PM | Report abuse

Update to previous post:

I looked up the studies referenced in the articles you linked. They measure quality based on adherence to protocols for certain types of common patient care. It may well be that the VA system is better at this standard treatment than other hospitals.

But I do stand by the stories I've been told, which date to the era when the VA system was supposedly improved. While doctors may choose a better course for treatment, my little sample size says their execution is terrible: surgical errors happen constantly and aren't reported to patients, nurses fail to perform tests ordered by doctors, etc. The patients don't complain because (a) they often have no idea how badly their doctors are screwing up, and (b) veterans are self-selected to be compliant.

Anyhow, that's my two cents.

Posted by: davestickler | June 3, 2009 8:45 PM | Report abuse

Castorp1, the article you link mostly references the same information as the article Ezra linked, except that it also mentions a RAND study that used health outcomes as a measure of quality. I found what I believe to be that study here:

The takeaway is that hospitals were compared on the basis of adherence to standards for care. The VA system outperformed other hospitals in that department, as it had in the other studies -- and RAND points out why by reminding us that VA doctors are measured by their adherence to standard treatments in a way that private sector doctors are not.

This mostly reinforces what anyone with any familiarity with school testing knows -- that, when you measure performance in a certain way, you can expect performance to improve on that metric. However, as anyone familiar with school testing also knows, reliance on that performance metric can sometimes give a misleading portrait of overall performance, especially when compared to people who are not competing according to the metric being used.

Because recommended practices are recommended for a reason, it's probably a good thing that VA doctors are adhering to them. But the evidence presented in the papers I've found so far is not equivalent to an argument that the overall quality of care in the VA system is superior to quality of care elsewhere.

Posted by: davestickler | June 3, 2009 9:01 PM | Report abuse

This is sloppy. You're conflating payment systems with care delivery systems. Seriously, any analysis that lumps Kaiser & Mayo in with McAllen Texas is really not very well thought through.

The whole government control versus non-government control is a red herring. Medicare subsidizes some of the very worst care delivery in the US along with some of the best. Sure, you can rank quality by payor, but you're not learning anything because three of these four are operating in the same care delivery system, so you're just arguing about who's got more administrative efficiencies and whose price discovery methodologies do you prefer. It's a sideshow.

Obviously, it is meaningful that the VA system is better than Medicare, but the appropriate analogy is VA: Medicare as Kaiser/Mayo: Medicare. It's the delivery system and the payment approach that are consequential, NOT who actually signs the check.

Posted by: theorajones1 | June 3, 2009 10:19 PM | Report abuse

Based upon real world experience, the VA system is highly mixed. I have seen examples of both excellent care and terrible care. In many ways they are years behind. I have a number of patients who go to the VA to get free meds but also see me because the care is so poor from the VA.

Measures of quality in health care are very poor. They are generally measures not of what is being done but what is being reported. Most doctors in private practice do not have the time to report everything we do with regards to following protocols. The incentive payments for such reporting are typically far less than the administrative costs. Often insurers try to extract data from claims data but the results from this turn out to be highly inaccurate.

The VA comes out ahead because they have a computer system set up to submit the data and they have employees who follow their instructions on submitting data. This makes their numbers look better, but has little to do with the quality of care.

Posted by: RonChusid | June 4, 2009 10:06 AM | Report abuse

Wait, so let me get this straight. The consensus in the comments seems to be that because the VA has a comprehensive electronic medical record and because they're scored on adhereing to best practices, they just "look" better than non-VA care but aren't really delivering better care.

So... best practices are not really best practices and good things happen all the time in doctors' offices that aren't documented but we should just trust that they happen. Checkmate my friend, checkmate.

And I think most people would agree that it's not that the government is paying the bills, it's that care is delivered in an integrated model where doctors are on salary and aren't incentivized to provide more care regardless of benefit to the patient. But only a handful of organizations outside of the government-run VA have been able to establish such a model. Why is that?

Posted by: consid24 | June 4, 2009 10:35 AM | Report abuse

Did you happen to read those stories about Walter Reed a couple of years ago? I think I would pretend to be a dog and start going to a veterinarian if that was my only option.

Posted by: fallsmeadjc | June 4, 2009 10:55 AM | Report abuse

What a ridiculous equivocation to rank payers and health care delivery providers in the same chart.

The VA system is better at one thing- bookkeeping, because they have spent a huge amount of money on information technology for health care and they don't have to worry about the real costs of specific treatments. They have a pre-funded capacity, and if it is exceeded you wait. When they have too much capacity, we pay.

If you really dig into the total costs of running the VA, you find that the budget is connected to the DoD and most of the simple calculations you say in favor of the system conveniently leave much of this out.

Simple question- would you rather go to your doctor next week or go to the VA? I spent a lot of time in the military medical system. It is a good system, but definitely worse than what I can select for myself amongst private providers.

Posted by: staticvars | June 4, 2009 11:20 AM | Report abuse


The patients involved in the Walter Reed debacle generally said that their medical treatment was very good. It was the living accomodations provided for long distance patients that were so terrible.

Posted by: fishermansblues | June 4, 2009 11:55 AM | Report abuse

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