Unhealthy Competition

This article recently appeared in The American Prospect.

Unhealthy Competition

How creeping privatization of health care services for military veterans is not helping patients or their caregivers.


APRIL 17, 2023

President Joe Biden has voiced concern that corporate consolidation has led to what he calls “widening racial, income, and wealth inequality.” Two years ago, Biden signed an executive order, directing federal agencies to help workers and consumers by promoting “a fair, open, and competitive marketplace.” Through 72 discrete actions called for in the order, workers would have more freedom to negotiate higher wages, and consumers would have “more choices, better service, and lower prices.”

Health care was a particular area of focus. “Americans are paying too much for prescription drugs and healthcare services,” the order states, and “hospital consolidation has left many areas, particularly rural communities, with inadequate or more expensive healthcare options.”

The Biden administration Cabinet member in charge of our third-largest federal agency is a dutiful follower of this White House directive, but not in a way that is helpful to his own constituency. Secretary of Veterans Affairs Denis McDonough oversees the nation’s largest public health care system, which is heavily unionized, covers a diverse patient population of nine million, has a major presence in underserved rural areas, and is the only health care system in the United States that negotiates big pharmaceutical discounts.

Empowered by the VA MISSION Act of 2018, McDonough’s Republican predecessor opened the floodgates for an outsourcing program that now enriches 1.5 million private contractors. As a result, 35 percent of the VA’s direct-care budget is currently being diverted to a “Veterans Community Care Program” (VCCP) that competes with the VA. As the secretary himself has stated, this nod to competition fails to deliver better choices, faster service, lower-cost care, worker empowerment, or any reduction in race- or income-based inequities in medical care access, particularly in rural areas.


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