Veterans Health Administration benefit value has little effect on reliance.

Area of Science:

• Health Services Research
• Health Economics
• Veterans Affairs Healthcare

Background:

• US military veterans possess diverse health insurance options, including the Veterans Health Administration (VHA) and Medicare.
• Strategic selection of coverage can arise from benefit availability and value, potentially leading to inefficient resource allocation.
• Understanding the link between benefit value and coverage reliance is crucial for optimizing healthcare utilization and budgets.

Purpose of the Study:

• To investigate the relationship between the relative benefit value of the VHA and Medicare Advantage (MA) and veterans' enrollment and reliance on VHA-provided care.
• To quantify the impact of changes in VHA benefit value on Medicare Advantage enrollment and VHA care utilization among veterans.

Main Methods:

• Analysis of nationally representative, cross-sectional survey data from US veterans spanning 2016-2019.
• Utilized a novel measure of benefit value for VHA and MA programs.
• Employed linear regressions with state and year fixed effects to assess the influence of relative VHA benefit value on MA enrollment and subsequent VHA care reliance.

Main Results:

• A $1 increase in relative VHA benefit value correlated with a maximum 0.2% decrease in MA enrollment probability.
• This increase also corresponded to a 0.3-percentage point rise in reliance on VHA-paid care.
• Effects were consistent across subgroups, with slightly larger impacts observed for enrollees with less generous benefits.

Conclusions:

• For the majority of veterans, the perceived benefit value of VHA coverage exerts a small, often statistically insignificant, influence on their reliance on VHA services.
• Findings suggest that modifications to VHA benefit value are unlikely to precipitate substantial shifts in veteran utilization patterns of VHA healthcare.