Why veterans should be free to choose own health care

09/02/2014 5:23 PM

09/02/2014 10:16 PM

President Obama’s plan, revealed last week in Charlotte, for reforming the scandal-plagued Department of Veteran Affairs is a simple one: Spend more money.

The VA came under fire earlier this year after investigators discovered chronic delays in providing care, with the added bonus that patient wait times were falsified in an attempt to mask the poor performance of the agency. Delayed care not only results in prolonged physical suffering, but in the case of mental illness, suicide is a serious concern. In fact, more veterans have died from suicide than from combat.

Our veterans – more than 750,000 of whom call North Carolina home – have paid a horrific price for VA bureaucracy. The VA is a failure of government design, one that should force us to radically rethink how we provide health care for our veterans. Rather than forcing veterans to use government-operated hospitals, veterans should be free to choose their health care providers.

Our health care system should be allowed to compete to serve veterans. If there is a line at a VA hospital, veterans should be able to go elsewhere. Empowering veterans to take their health care dollars with them would create a powerful incentive for hospitals and doctors across the nation to provide prompt, high-quality care.

The government has a poor track record in its business ventures – most forays range from bunglesome to outright failure. The U.S. Postal Service provides all you need to know about how ineffectively the government runs a business. The USPS loses billions of dollars each year, despite being a monopoly. Or consider the Department of Motor Vehicles – the quintessential example of bad government service. How many hours have been wasted at the DMV?

The reason the government is so often a poor provider is that it lacks incentives to deliver quality products and services. There is no competition to pressure the government to please customers. The failures of basic government services like the USPS and the DMV should give us pause when attempting a much more ambitious project like health care.

One thing the government does exceptionally well is spend money. So, once again, this was the “solution” offered to fix the VA. Our nation does have an obligation to help our veterans with their health care needs, but we’re spending money in the wrong way – sinking more into a government-run business that, like the USPS and the DMV, has been failing and is likely to continue along this path.

A better approach would be for the government to provide veterans with vouchers to use to choose their hospitals and doctors. The Supplemental Nutrition Assistance Program – commonly referred to as food stamps – provides a good model. Families that receive food stamps do not have to shop at government-run grocery stores where produce, meat, baked goods and other foods are provided by government-owned and operated farms, bakeries and kitchens.

Instead, people are allowed to make their own choices about where they shop and what products to buy. The variety of grocery stores, the array of quality options on their shelves and the low cost of food are evidence that choice and competition work. Just as the government gives families receiving food stamps the money to buy food of their choice, so too should the government enable veterans to obtain the health care of their choice.

The real problem with VA hospitals is that they don’t have to compete for customers. They have a guaranteed budget, and customers are forced to use their services. Lines, lists and rationed care are the result. At least 40 veterans died while waiting for treatment in Arizona. This is a shame for our vets but an even greater shame on us. We are free to choose. Our vets deserve the same.

Stewart Dompe is an adjunct professor of economics at Johnson & Wales University in Charlotte. Adam C. Smith is an assistant professor of economics and director of the Center for Free Market Studies there.

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