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Veterans Affairs 101: Three charts show how the VA system differs from Medicare

Gabby Migliara
Gabby Migliara March 11, 2022

Veterans Affairs 101: Three charts show how the VA system differs from Medicare.

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The U.S. Department of Veterans Affairs (VA) primarily provides medical coverage for veterans who have experienced service-related disabilities. Its unique system was developed to meet the targeted health care needs of veterans, unlike other federal government programs that provide health coverage to a large and diverse population of patients. While it provides access to care for our nation’s 9 million veterans, the VA tends to cover fewer medicines on its national formulary than what is available in other large government programs, like Medicare Parts B and D.

Here are three facts about Veterans Affairs health care you may not know.

1. The VA offers care to veterans through a centralized VA health care system, meaning it directly employs its own physicians whose prescribing decisions are tailored to the VA formulary. Care is focused on service-related needs, and largely delivered by VA-employed physicians in a limited number of VA health care facilities, unlike Medicare which uses community-based health care providers.

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2. In 2020, fewer than 20% of VA enrollees relied on VA to meet all of their health care needs. Specifically, the vast majority of VA enrollees relied on other sources of health coverage to help supplement their medicine coverage, including Medicare.

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3. The VA program limits the medicines it offers through a single, national formulary. The narrow VA formulary covers only half of the top medicines in Medicare Parts B and D and a smaller percentage of FDA first-in-class therapeutics.

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As illustrated through these charts, health care benefits through the VA are more restricted than what is available in Medicare. Despite this, some advocates of government price setting would tie medicine prices in Medicare to those in the VA. This misguided approach, like other government price-setting proposals, could threaten patients’ access to medicines and future innovation.

The Veterans Affairs program serves an important role, but it should not be the template for how other programs reimburse for and cover medicines.

Learn more about the Veterans Affairs program.

Topics: Drug Cost, Health Insurance, Policy Solutions, Proactive Agenda, Government Price Setting