Primary Care's Effects on Costs in the US Veterans Health Administration, 2016-2019: an Observational Cohort Study.

BACKGROUND: Enhancing primary care is a promising strategy for improving the efficiency of health care. Previous studies of primary care's effects on health expenditures have mostly relied on ecological analyses comparing region-wide expenditures rather than spending for individual patients. OBJECTIVE: To compare overall medical expenditures for individual patients enrolled vs. those not enrolled in primary care in the Veterans Health Administration (VHA). DESIGN: Cohort study with stratification for clinical risk and multivariable linear regression models adjusted for clinical and demographic confounders of expenditures. PARTICIPANTS: In total, 6,009,973 VHA patients in fiscal year (FY) 2019-5,410,034 enrolled with a primary care provider (PCP) and 599,939 without a PCP-and similar numbers in FYs 2016-2018. MAIN MEASURES: Total annual cost per patient to the VHA (including VHA payments to non-VHA providers) stratified by a composite health risk score previously shown to predict VHA expenditures, and multivariate models additionally adjusted for VHA regional differences, patients' demographic characteristics, non-VHA insurance coverage, and driving time to the nearest VHA facility. Sensitivity analyses explored different modeling strategies and risk adjusters, as well as the inclusion of expenditures by the Medicare program that covers virtually all elderly VHA patients for care not paid for by the VHA. KEY RESULTS: Within each health-risk decile, non-PCP patients had higher outpatient, inpatient, and total costs than those with a PCP. After adjustment for health risk and other factors, lack of a PCP was associated 27.4% higher VHA expenditures, $3274 per patient annually (p < .0001). Sensitivity analyses using different risk adjusters and including Medicare's spending for VHA patients yielded similar results. CONCLUSIONS: In the VHA system, primary care is associated with substantial cost savings. Investments in primary care in other settings might also be cost-effective.

Administration's Share of Personnel in Veterans Health Administration and Private Sector Care.

Importance: Health care administrative overhead is greater in the US than some other nations but has not been assessed in the Veterans Health Administration (VHA). Objective: To compare administrative staffing patterns in the VHA and private (non-VHA) sectors. Design, Setting, and Participants: This cross-sectional study was conducted using US employment data from 2019, prior to pandemic-related disruptions in health care staffing, and was carried out between January 14 and August 10, 2023. A nationally representative sample of federal and nonfederal personnel in hospitals and ambulatory care settings from the American Community Survey (ACS), all employees reported in VHA personnel records, and personnel in health insurance carriers and brokers tabulated by the Bureau of Labor Statistics (BLS) were analyzed. Exposure: VHA vs private sector health care employment, including 397 occupations grouped into 18 categories. Main Outcome and Measure: The proportion of staff working in administrative occupations. Results: Among 3 239 553 persons surveyed in the ACS, 122 315 individuals (weighted population, 12 501 185 individuals) were civilians working in hospitals or ambulatory care; of the weighted population, 12 156 988 individuals (mean age, 42.6 years [95% CI, 42.5-42.7 years]; 76.2% [95% CI, 75.9%-76.5%] females) were private sector personnel and 344 197 individuals (mean age, 46.2 years [95% CI, 45.7-46.7 years]; 63.8% [95% CI, 61.8%-65.8%] females) were federal employees. In clinical settings, administrative occupations accounted for 23.4% (95% CI, 23.1%-23.8%) of private sector vs 19.8% (95% CI, 18.1%-21.4%) of VHA personnel. After including 1 000 800 employees at private sector health insurers and brokers and 13 956 VHA Central Office personnel with administrative occupations, administration accounted for 3 851 374 of 13 157 788 private sector employees (29.3%) vs 77 500 of 343 721 VHA employees (22.5%). Physicians represented approximately 7% of personnel in the VHA (7.2% [95% CI, 6.1%-8.2%]) and private sector (6.5% [95% CI, 6.3%-6.7%]), while the VHA deployed more registered nurses (23.7% [95% CI, 21.6%-25.8%] vs 21.2% [95% CI, 20.9%-21.5%]) and social service personnel (6.3% [95% CI, 5.4%-7.1%] vs 4.9% [95% CI, 4.7%-5.0%]) than the private sector. Conclusions and Relevance: In this study, administrative occupations accounted for a smaller share of personnel in the VHA compared with private sector care, a difference possibly attributable to the VHA's simpler financing system. These findings suggest that if staffing patterns in the private sector mirrored those of the VHA, nearly 900 000 fewer administrative staff might be needed.

The Effect of Primary Care Visits on Total Patient Care Cost: Evidence From the Veterans Health Administration.

BACKGROUND: Since the 1980s, primary care (PC) in the US has been recognized as the backbone of healthcare providing comprehensive care to complex patients, coordinating care among specialists, and rendering preventive services to contain costs and improve clinical outcomes. However, the effect of PC visits on total patient care cost has been difficult to quantify. OBJECTIVE: To assess the effect of PC visits on total patient care cost. METHODS: This is a retrospective study of over 5 million patients assigned to a PC provider in the Veterans Health Administration (VHA) in each of the 4 fiscal years (FY 2016-2019). The main outcome of interest is total annual patient care cost. We assessed the effect of primary care visits on total patient care cost first by descriptive statistics, and then by multivariate regressions adjusting for severity of illness and other confounders. We conducted in-depth sensitivity analyses to validate the findings. RESULTS: On average, each additional in-person PC visit was associated with a total cost reduction of $721 (per patient per year). The first PC visit was associated with the largest savings, $3976 on average, and a steady diminishing return was observed. Further, the higher the patient risk (severity of illness), the larger the cost reduction: Among the top 10% of high-risk patients, the first PC in-person visit was associated with a reduction of $16 406 (19%). CONCLUSIONS: These findings, substantiated by our exhaustive sensitivity analyses, suggest that expanding PC capacity can significantly reduce overall health care costs and improve patient care outcomes given the former is a strong proxy of the latter.