NCPA - National Center for Policy Analysis


August 25, 2005

In the past decade, the Department of Veteran Affair's sprawling health care system has undergone a dramatic transformation and some experts see the VA makeover as a lesson for the nation's troubled health care system, says the Washington Post.

VA's makeover began with Kenneth W. Kizer, a physician and former Naval Reserve officer who helped restructure health services for the state of California. In just five years, Kizer reorganized the VA's unwieldy network of 172-plus hospitals and 132 nursing homes into 22 self-contained systems responsible for providing all patient care.

Researchers now laud the VA for its use of electronic medical records, its focus on preventative care and its outstanding results:

  • The system outperforms Medicare and most private health plans on many quality measures, including diabetes care, managing high blood pressure and caring for heart attack patients.
  • Since 1995, the number of patients has doubled to about 5.2 million; at the same time, the department has trimmed its staff by about 12,000 people, opened hundreds of outpatient clinics, shifted its focus to primary care and cut costs per patient by about half.
  • Computers measure everything at VA sites, creating weekly statistics and driving performance; for example, in 1990, before Baltimore began tracking its performance, rates of screening for breast and cervical cancer were 50 percent and 17 percent, but in 2003, they were 88 percent and 87 percent.

The Post says a large part of this shift comes from the investment in computers. The VA's 75,000 physicians now have access to a detailed electronic record of every patient.

Jonathan B. Perlin, the acting undersecretary of health, estimates it costs the VA about $78 per patient per year to operate the electronic health records, roughly the equivalent of not repeating one blood test. He says the VA has proved quality is less expensive.

Source: Gilbert M. Gaul, "Revamped Veteran's Health Care Now a Model," August 22, 2005.

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