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Updated September 15, 2020
Do Veterans Have Choices in How They Access Health Care?
Introduction
Category 1) do not pay any copays for both service-
On June 6, 2018, the President signed into law the VA
connected and nonservice-connected care. Veterans in
MISSION Act of 2018 (P.L. 115-182, as amended). Among
Priority Categories 1 through 5 are not required to pay
other things, the act established a new Veterans Community
inpatient or outpatient copayments. Nonservice-connected
Care Program (VCCP). Under VCCP, all veteran enrollees
care veterans (who are required to pay) have a copayment
would be eligible for hospital care, medical services, and
for primary and specialty care visits. In addition, for
extended care services, in the community, provided they
outpatient medications for nonservice-connected care, there
meet one of the six criteria stipulated in the law (38 U.S.C.
is a tiered pharmacy copayments methodology (see CRS
§1703 and 38 C.F.R.§17.4000), at the Department of
Report R42747, Health Care for Veterans: Answers to
Veterans Affairs (VA), Veterans Health Administration’s
Frequently Asked Questions). According to VHA, the
(VHA) expense. Because of these policies, the VA expects
average annual out-of-pocket costs for veterans receiving
enrollees to get more of their care through VHA rather than
care through VHA across all priority categories with co-
relying on other federal and private health care sources
pays (for outpatient, inpatient, medication, long-term care,
(2021 Congressional Budget Submission, vol. II, p. VHA-
and community care) was $279.94 in FY2019, and ranged
268, and Economic Regulatory Impact Analysis for Veterans
from $155.28 for Priority Category 2 veterans to $367.84
Community Care Program, p. 9). Therefore, it is important
for Priority Category 8 veterans.
to understand how veterans currently receive care from the
VHA and other sources of health care, such as Medicare and
Veterans with Other Health Coverage
private insurance.
Veterans can have multiple forms of health care coverage
(i.e., veterans with Medicare may also be covered by
VA Health Care Is Not Health Insurance
Medicaid). According to an analysis done by VHA of the
Compared with the predominant health care delivery model
American Community Survey (ACS) data for 2018, of the
in the United States—where there is a payer (e.g., Medicare
approximately 17.96 million veterans identified,
or private health insurance), a provider (e.g., hospital,
approximately 9.34 million reported having coverage
physician), and a recipient of care (the patient)—the VA is a
through Medicare, about 6.61 million had care through the
very different model of care. In general, private health
VHA, about 4.04 million had coverage through private
insurance plans charge premiums from beneficiaries for
health insurance plans (includes those covered by the Indian
enrolling in those plans. Furthermore, most private health
Health Service), and about 3.31 million veterans had care
insurance plans have cost-sharing requirements (that is the
through the Department of Defense (DOD) TRICARE
amount that beneficiaries are required to pay out of pocket
program (TRICARE and TRICARE for Life—veterans are
when they use health care services). These could include
eligible for TRICARE if they served for at least 20 years in
deductibles (the amount a beneficiary must pay out of
the military; veterans are eligible for TRICARE for Life if
pocket before the insurance plan begins paying for services),
they qualify for Medicare and it is available as a
coinsurance (a specified percentage a beneficiary pays out
wraparound coverage for costs not covered by Medicare).
of pocket to providers after meeting any deductible
Approximately 510,000 veterans did not have health
requirements), or copayments (a fixed amount paid for a
insurance coverage (see Figure 1).
health care service, at the time of service). In contrast, VA
is primarily a direct provider of care funded through annual
Figure 1. Sources of Health Coverage Among
discretionary appropriations—although VHA does pay for
U.S. Veterans
care in the community under certain circumstances (38
U.S.C. §§1703; 1720; 1725; 1725A; 1728). In addition, in
the VHA system, enrolled veterans do not pay any
premiums, deductibles, or coinsurance. Furthermore,
generally not all veterans are eligible to enroll in the VA
health care system; the system is neither designed nor
funded to care for all living veterans (The Journal of Law,
Medicine & Ethics, vol. 36, issue 4, winter 2008, p. 680).
Veterans Out of Pocket Costs
Some veterans are charged copayments based on their
priority categories. VA is required (38 U.S.C. §1705) to
manage an enrollment system with eight priority categories,
Source: Figure adapted by CRS based on VHA analysis of 2018
with Priority Category 1 being the highest priority for
American Community Survey (ACS) data.
enrollment. Generally, veterans who have been rated with a
Notes: Totals do not add up to 17.96 mil ion because a veteran may
service-connected disability of 50% or more (Priority
have more than one kind of coverage. Persons covered by two or
https://crsreports.congress.gov