Spending on Primary Care in VHA Shows Room for Improvement

Primary care accounted for just 8% of spending in the Veterans Health Administration (VHA) in 2018, suggesting opportunities for improvement. Researchers published their findings in a recent research letter in JAMA Network Open.

“Although primary care is associated with higher quality of care, better outcomes, and lower costs, a low proportion is spent on primary care in the US among both commercial payers (4%-8%) and Medicare fee-for-service (2%-5%),” wrote investigators from the Center of Innovation for Veteran-Centered and Value-Driven Care, VA Puget Sound Health Care System, Seattle, Washington.

To assess the proportion of primary care spending in the VHA, researchers calculated spending in 2014 and 2018 across six different categories: primary care and integrated behavioral health, specialty mental health, medical and surgical outpatient care, inpatient care, pharmacy, and diagnostic or other spending.

Among $50.9 billion spent across the six categories in 2014, primary care represented 9% of the total. By 2018, despite an increase in total spending to $58.5 billion, the proportion of spending attributed to primary care fell to 8%, according to the study.

The analysis identified substantial variation in primary care spending by patient demographics.

In 2014, the percentage of spending within primary care was higher for patients younger than 40 years compared with patients aged 55 to 64 years, and higher for female patients compared with male patients. The highest percentage of spending was among Asian patients (11.3%), researchers reported, and the lowest was among Black patients (6.3%).

By 2018, the proportion spent on primary care decreased for all demographic groups, the study found.

“[O]ur estimates suggest that primary care spending by the VHA may be higher than that by other US payers but lower than that by health systems outside the US (12%-17% in Organisation for Economic Co-operation and Development countries),” researchers wrote. “ In addition, our estimates are below what many states have set as targets (>10% of spending on primary care) to improve outcomes and lower total costs of care.”

Reference:
Reddy A, Nelson KM, Wong ES. Primary Care Spending in the Veterans Health Administration in 2014 and 2018. JAMA Netw Open. 2021;4(7):e2117533. Published 2021 Jul 1. doi:10.1001/jamanetworkopen.2021.17533