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December 16, 2016
Introduction to Veterans Health Care
The federal government’s role in providing health care to
eligibility category is veterans with no service-connected
the nation’s veterans can be traced back to World War I.
disabilities but who also have attributable incomes above an
The veterans’ health care system was first developed when
established means test. Once veterans are determined to be
Congress passed P.L. 65-326 in 1919 and authorized the
eligible for care in VHA, veterans are required to formally
Public Health Service to provide needed care to veterans
enroll in the VHA health care system in order to receive
injured or sick as a result of military service (today known
services and are placed in one of eight priority groups based
as a service-connected disability)—a disability that is
on the first or second eligibility category. Once a veteran is
incurred or aggravated during active military, naval, or air
enrolled, the veteran remains in the system and does not
service. In 1924, with the passage of the World War
have to reapply for enrollment annually. Enrolled veterans
Veterans Act (P.L.68-242), veterans with no service-
do not pay any premiums, deductibles, or coinsurance for
connected disability “financially unable to pay” for care
their care. Some veterans are required to pay co-payments.
were also given access to Department of Veterans Affairs
In contrast, major medical insurance plans typically have
(VA) health care, thus creating a safety net mission.
premiums, deductibles, and co-payments.
Congress has enlarged the scope of VA’s health care
mission and has enacted legislation expanding benefits, new
Trends in Enrollment
programs, and services. This In Focus briefly outlines the
As required by the Veterans’ Health Care Eligibility
mission, eligibility and enrollment requirements, health care
Reform Act of 1996, VHA began formally enrolling
delivery system, and funding for veterans health care.
veterans for the first time in FY1999. As shown in Figure 1
Selected trends in enrollment and budget are provided as
just over 4.9 million veterans (19% of all veterans) were
well.
enrolled in the VHA in FY2000; by FY2016, that number
was estimated to have increased 86%, to 9.1 million
Mission of the VA Health Care System
enrollees. This increase is due, in part, to factors such as
The VA provides health care and health-related services
enrollment of newer veterans from Operation Enduring
through the Veterans Health Administration (VHA). Its
Freedom/Operation Iraqi Freedom/Operation New Dawn
primary mission is to provide health care services to
(OEF/OIF/OND), a larger number of female veterans, and
eligible veterans and some family members. The VHA is
economic conditions, among other factors.
also statutorily required to conduct medical research, to
train health care professionals, to serve as a contingency
Figure 1. VHA Enrolled Veterans, FY2000 to FY2016
back up to the Department of Defense (DOD) medical
system during a national security emergency, and to
provide support to the National Disaster Medical System
and the Department of Health and Human Services (HHS)
as necessary (38 U.S.C. §§7301-7303; §8111A; §1785).
Eligibility and Enrollment for Care
Not all veterans are eligible to receive care, and not every
veteran is automatically entitled to medical care from the
VHA—the system is neither designed nor funded to care
for all living veterans (The Journal of Law, Medicine &
Source: Chart prepared by CRS based on VA enrollee numbers in
Ethics, Volume 36, Issue 4, p.680, Winter 2008). Eligibility
the Department of Veterans Affairs budget justifications
for veterans health care has evolved over time, and laws
governing eligibility have been amended by Congress many
Note: FY2000-FY2015 numbers are actual; the FY2016 number is an
times. The last major eligibility amendments occurred in
estimate.
1996 with passage of the Veterans’ Health Care Eligibility
Reform Act of 1996 (P.L. 104-262). This law established
two eligibility categories and required the VHA to manage
In a given year, not all enrolled veterans receive their care
the provision of hospital care and medical services through
from the VA—either because they do not need services or
an enrollment system based on a system of priorities.
because they have other forms of health coverage such as
Medicare, Medicaid, or private health insurance. Figure 2
The first eligibility category is veterans with service-
shows the percentage of enrollees who are unique patients
connected disabilities, Medal of Honor recipients, Purple
in a given year. Generally, around two-thirds of enrollees in
Heart recipients, former prisoners of war, veterans exposed
a given year are VHA patients and receive some or all of
to toxic substances and environmental hazards such as
their health services from VHA.
Agent Orange, and veterans whose attributable income are
equal to or below an established “means test.” The second
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Introduction to Veterans Health Care
Figure 2. VHA Patients as a Percentage of VHA
appointments, family caregiver stipends, homeless veterans
Enrollees, FY2000-FY2016
programs, and dental care (38 C.F.R. §17.38).
VHA Health Care Appropriations
Congress annually provides discretionary appropriations to
fund VA health care and support services for enrolled
veterans. In addition to annual discretionary appropriations,
Congress has provided VHA the authority to bill some
veterans and most health care insurers for nonservice-
connected care provided to enrolled veterans to help defray
care costs.
Trends in Appropriations
In FY2017, Congress provided $64.59 billion (not shown in
Figure 3) for VHA—without research and collections
Source: Chart prepared by CRS based on VA enrollee and patient
amounts—and in FY1995 this amount was $16.22 billion
numbers in the Department of Veterans Affairs Budget Justifications.
(in nominal dollars). Between FY1995 and FY2005, VHA’s
appropriations grew in real terms by 2% on average;
Notes: FY2000-FY2015 numbers are actual; the FY2016 number is
between FY2005 and FY2015, it grew by 4% on average.
an estimate.
Overall from FY1995 to FY2015, VHA’s appropriations in
VA Health Care System
real terms grew by about 2.8% on average, from about $33
billion to $55 billion (Figure 3).
Once veterans are eligible and enrolled, they receive their
care directly through a large integrated health care system.
Figure 3. VHA Appropriations, FY1995-FY2015
VHA is the largest integrated health care system in the
United States, with over 1,700 sites of care, including
medical centers, community based outpatient clinics
(CBOCs), nursing facilities, and Vet Centers. To administer
this large system, the VHA has divided the country into
Veterans Integrated Service Networks (VISN), based on
geography. There are currently 18 VISNs, which vary
regarding the number of sites of care, the types and number
of facilities, and the geographic size of the network’s
region. Each VISN has a VISN Director, who has oversight
of the VA facilities within that VISN and directly
supervises the facility director at each facility. Although
policies and guidelines are developed at VA headquarters to
be applied throughout the VHA health care system,
management authority for basic decisionmaking and
budgetary responsibilities are delegated to the VISNs.
Source: Chart prepared by CRS based on enacted appropriation
It should be noted that compared with the predominant
figures provided by VA Office of Budget.
health care financing and delivery model in the United
Notes: VHA medical care appropriations include funding for the
States—where there is a payer for health care services (e.g.,
medical services, medical administration, and medical facilities
Medicare or private health insurance plan), a provider (e.g.,
accounts, and exclude medical and prosthetic research funding and
hospital, physician), and a recipient of care (the patient)—
medical care collections.
the VHA operates under a very different model. It is not a
health insurance financing program that provides
reimbursement to providers for all or a portion of a patient’s
CRS Products
health care costs. VHA is primarily a direct provider of
CRS Report R42747, Health Care for Veterans: Answers to
care; VHA owns the hospitals and employs the clinicians.
Frequently Asked Questions, by Sidath Viranga Panangala
Nevertheless, VHA does pay for care in the community
CRS Report R44625, Department of Veterans Affairs FY2017
under certain circumstances, as authorized (38 U.S.C.§1701
Appropriations, by Sidath Viranga Panangala
note;38 U.S.C.§1703;38 U.S.C.§1703 note; 38
CRS Report R44301, Veterans’ Medical Care: FY2016
U.S.C.§8153; 38 U.S.C.§8111;38 U.S.C.§1725; and 38
Appropriations, by Sidath Viranga Panangala
U.S.C.§1728).
Health Care Services
All enrolled veterans are eligible for a standard medical
package, which includes a full range of health care, gender-
Sidath Viranga Panangala, Specialist in Veterans Policy
specific medical services, prescription drugs, long-term
IF10555
care, and social support services. The medical package
provides benefits generally not found in private health
insurance plans, such as travel reimbursement for medical
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Introduction to Veterans Health Care
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