VA Health Care:

VA Is Adopting Managed Care Practices to Better Manage Physician Resources

HEHS-97-87: Published: Jul 17, 1997. Publicly Released: Jul 17, 1997.

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Stephen P. Backhus
(202) 512-7111


Office of Public Affairs
(202) 512-4800

Pursuant to a congressional request, GAO provided information on what the Department of Veterans Affairs (VA) is doing to manage its physician resources as well as how health maintenance organizations (HMO) manage their physician resources.

GAO noted that: (1) VA is in the midst of making fundamental changes in its health care delivery system because of budgetary pressures and increasing competition in the health care industry; (2) many of these initiatives are affecting the entire VA health care delivery system; they will also affect how VA manages physician resources, including identifying the appropriate number and skill mix of physicians and monitoring productivity and quality of care provided; (3) these initiatives involve changes in physician practice patterns and in resource allocation to help ensure effectiveness and efficiency; (4) VA is changing physician monitoring by emphasizing standardized productivity and clinical care outcome measures, which are increasingly being used in the private sector to monitor the efficiency and effectiveness of physician performance; (5) in addition, further embracing private sector managed care practicers, VA is changing the way physicians practice by assigning veterans to a primary care physician, an approach that emphasizes continuity of care, prevention, and the early diagnosis of disease and allows VA to better attribute clinical care outcomes to specific provider performance; (6) VA expects to change physician practice patterns and improve service delivery efficiencies by distributing health care funding on the basis of workload rather than according to historic funding patterns, which perpetuated imbalances in funding, efficiency, and access to care throughout the VA health care system; (7) VA has not developed a staffing and resource allocation model that identifies optimal physician staffing levels or the skill mix of physicians needed to provide health care to eligible veterans, and no agreed-upon physician workload standards exist either in the private sector or at VA for most physician specialties, including primary care; (8) VA faces unique challenges in managing its physician resources; (9) it must balance multiple congressionally mandated missions, such as training health care professionals, that reduce physicians' clinical care productivity relative to that of physicians in private sector HMOs; (10) in addition, VA performance measurement and allocation systems are hampered by incomplete and inaccurate data; and (11) moreover, accurate estimates of workload, and essential element of resource allocation, are particularly challenging with a patient population that is sicker and older than the general population and that moves in and out of the VA health care system.

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