http://www.tcsdaily.com/article.aspx?id=031907ACuring Walter Reed Syndrome; A Proposal Even Anti-War Doves Should Embrace
By Michael Cannon : 19 Mar 2007
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Privatizing both the insurance and delivery components of veterans' health benefits could have a number of benefits.
First, it would let veterans control the money. That means the system would serve them, not the politicians or the bureaucracy.
Second, it would allow vets to choose where they receive medical care and could reduce waiting times for care. Would the scandalous neglect and mistreatment of patients at Walter Reed have occurred if those same vets had the choice to go elsewhere? Patrick Feges of Sugar Land, Texas, was injured in Ramadi by a mortar. He waited 17 months for his first disability check from the VHA. A private insurer with that kind of reputation would have a hard time attracting customers.
Third, the premiums that private insurers charge would give new personnel an independent assessment of the risk posed by different military jobs.
Fourth, those risk-based premiums would increase when conflict seems imminent, in effect front-loading those war-related costs. Harvard professor Linda Bilmes estimates that caring for an anticipated 700,000 veterans of Iraq and Afghanistan will cost between $350 billion and $700 billion. Since Congress would have to increase pay enough for military personnel to insure against those costs up front, they would have an additional disincentive to start wars. The officials who make such decisions would have to plan for those costs themselves, rather than pass buck to their successors.
Some have argued that the VA should get out of medical care delivery by selling off its hospitals and giving veterans a voucher that they could use to purchase medical care wherever they like. That probably would increase the quality of care that veterans receive. But that would also leave VHA in the health and disability insurance business.
It seems to me that a better approach would be to give vouchers to all personnel currently in the system, but increase pay and let private carriers insure against service-related injuries for all new enlistments and commissions. Such a system could improve the quality of care for vets. It also would give Congress, the armed forces, and the public a lot of very useful information about the costs of foreign policy decisions.
Michael F. Cannon is director of health policy studies at the Cato Institute, and co-author of "Healthy Competition: What's Holding Back Health Care and How to Free It."