Title: Co-payment restructuring and its impact on resources at the US Department of Veterans Affairs

Authors: Jian Gao, James Campbell, Joseph Engelhardt, Fred Malphurs

Addresses: Department of Veterans Affairs (VA) Healthcare Network Upstate New York, 113 Holland Avenue-Bldg. 7, Albany, NY 12208, USA. Department of Veterans Affairs (VA) Healthcare Network Upstate New York, 113 Holland Avenue-Bldg. 7, Albany, NY 12208, USA. Department of Veterans Affairs (VA) Healthcare Network Upstate New York, 113 Holland Avenue-Bldg. 7, Albany, NY 12208, USA. Department of Veterans Affairs (VA) Healthcare Network Upstate New York, 113 Holland Avenue-Bldg. 7, Albany, NY 12208, USA

Abstract: The US Department of Veterans Affairs (VA) healthcare co-payment policies, governed by multiple legislations, were incoherent. In particular, the outpatient visit co-payment rate was too high compared with non-VA sectors. In early 1999, VA initiated a legislative proposal to restructure its co-payment policies and, later, the Millennium Act provided VA with the authority to set co-payment rates for outpatient care, long-term care and pharmacy. Co-payment reduction inevitably affects the congressionally appropriated VA healthcare budget; consequently, an assessment of the impact was critically needed. This paper describes the actual decision making process of co-payment redesign and presents the evaluation strategy, i.e., the combination of an enhanced two-part model and the dynamics of VA eligibility means test status. This method effectively evaluated the impact of a $38.80 reduction in outpatient co-payment, which is intractable by conventional techniques. The results of this study provided essential information for the decision makers in designing outpatient co-payment policy.

Keywords: quality; access; cost; utilisation; means test; enhanced two-part model.

DOI: 10.1504/IJHTM.2003.003331

International Journal of Healthcare Technology and Management, 2003 Vol.5 No.1/2, pp.141 - 155

Published online: 28 Aug 2003 *

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