External Determinants of Veterans' Utilization of VA Health Care

Veterans' utilization of Veterans Affairs (VA) health care is likely influenced by community factors external to the VA, including Medicaid eligibility and unemployment, although such factors are rarely considered in models predicting such utilization. We measured the sensitivity of VA utilization to changes in such community factors (hereafter, "external determinants"), including the 2014 Medicaid expansion following the Affordable Care Act.

We merged VA health care enrollment and utilization data with area-level data on Medicaid policy, unemployment, employer-sponsored insurance, housing prices, and non-VA physician availability (2008-2014).

For veterans aged 18-64 and ≥65, we estimated the sensitivity of annual individual VA health care utilization, measured by the cost ($) of care received, to changes in external determinants using longitudinal regression models controlling for individual fixed effects.

All external determinants were associated with small but significant changes in VA health care utilization. In states that expanded Medicaid in 2014, this expansion was associated with 9.1 percent ($826 million) reduction in VA utilization among those aged 18-64; sizable changes occurred in all services used (inpatient, outpatient, and prescription drugs).

Changes in alternative insurance coverage and other external determinants may affect VA health care spending. Policy makers should consider these factors in allocating VA resources to meet local demand.