Government-provided health care. A prediction

Government-provided health care, provided primarily by the Department of Veterans Affairs and the Department of Defense, must prove itself competitively cost-effective for its continued survival. Cooperation and unification of health programs at each level of government are essential to minimize uneconomic duplications. Some form of a managed-care HMO will be necessary for future health care programs of the Department of Veterans Affairs and the Department of Defense. Enrollees must include the spouses and dependents of veterans. Each population segment of government-provided care should undergo a make-or-buy analysis to guide cost-effective strategies. A voucher system should be instituted on an experimental basis to explore the transition between the current system of health care and alternative use of community-based private care. Such a system has the political advantage of taking away nothing from the current rights of veterans or retirees. A variety of joint ventures between government health systems and private sector HMOs have been described. Cost cannot be the only consideration in make-or-buy government decisions. Overriding national priorities of defense, training of future physicians, and scientific advancement must also be considered.