When President Joe Biden braved Republican jeers and boos to deliver his State of the Union address in February, one of the few lines that received bipartisan applause recalled Congressional action last year on what he hailed then as the “most significant law our nation has ever passed to help millions of veterans.”

Called the Promise to Address Comprehensive Toxics (PACT) Act, this legislation allocates $280 billion over the next decade for health care and disability pay for former service members harmed by toxic substances. An estimated 3.5 million service members were exposed to noxious fumes from open burn pits and other hazards during three decades of U.S. military intervention in the Middle East. Many others developed long-term health problems during the Vietnam War, Cold War weapons’ testing, and even from serving in the United States, where some drank poisoned water at North Carolina’s Camp Lejeune.

Veterans’ organizations fought long and hard for federal recognition of a devastating array of service-related ailments. The PACT Act directs the Department of Veterans Affairs (VA) to consider twenty-three conditions ranging from bronchial asthma to a series of rare cancers as presumptively related to burn-pit exposure and other environmental hazards. By January of this year, according to VA Secretary Denis McDonough, his agency had received about 278,000 PACT Act claims, processing nearly 40,000 of them with a much-improved 85 percent approval rate.

The VA-run Veterans Benefits Administration (VBA) decides what compensation veterans should receive if they suffer from toxic exposures and whether they are eligible for care from the nation’s largest public health care system, the Veterans Health Administration (VHA).

A recent national survey of VA staff, interviews with their local union leaders and frontline staff, and reports by the government itself reveal that VA functioning has, over the last nine years, been greatly impaired by understaffing, costly and wasteful outsourcing, and other organizational problems inherited from the administrations of Barack Obama and Donald Trump. Despite pleas from frontline staff and even some of their managers, McDonough has, so far, failed to address these challenges.

As a result, too many veterans will continue experiencing what one VA benefits expert, Gulf War veteran Paul Sullivan, calls “an adversarial, complex, and burdensome claims nightmare,” which breeds anger and frustration over delayed disability payments and health care access. And when hundreds of thousands of new PACT Act patients finally join the nine million veterans already being treated by the VHA, many will discover that its direct care capacity has been undermined and disrupted by years of privatization under the Obama, Trump, and now Biden Administrations.

When McDonough became VA Secretary in February 2021, he inherited a huge backlog of unresolved claims, including those filed by burn-pit victims whose denial rate before the PACT Act was 78 percent. As Military.com reported on January 31, the VBA’s disability “claims backlog, defined as claims older than 125 days, has grown by roughly 50,000 since September to 200,140.”

To reduce that caseload, the PACT Act authorized the Biden Administration to hire and train 1,900 new VBA employees to help veterans navigate the overly byzantine and always time-consuming process of getting a “disability rating.” These ratings are necessary to qualify for financial compensation for service-related conditions and for health care coverage—which some veterans receive based solely on their low income or recent active duty in a combat zone.

According to a Veterans Healthcare Policy Institute (VHPI) report on a survey of VHA and VBA staff represented by the American Federation of Government Employees (AFGE), staffing shortages, inadequate training, bad management, and unnecessary outsourcing continue to plague their agency. VHPI found that 95 percent of the VHA survey respondents said they had shortages of frontline clinical staff. Nearly 60 percent of VHA respondents said there were vacant positions for which no recruitment was taking place. (It even took the Biden Administration two years to nominate a permanent VA Undersecretary for Benefits.) Nearly 80 percent of VBA staffers complained about caseload quotas that limit their ability to help individual veterans with confusing paperwork or complicated claims.

Veterans will continue experiencing “an adversarial, complex, and burdensome claims nightmare.”

One of the biggest concerns raised by VBA employees involves the use of private contractors to evaluate veterans’ health care conditions. Most compensation and pension exams, as they are called, were once handled by VHA clinicians with specialized knowledge of military culture and the signature wounds of particular wars. During the Trump Administration, thousands of VHA positions were left unfilled, so these medical examinations were outsourced on a larger scale than ever before. Private doctors working for the VBA were even permitted to assess complex conditions like military sexual trauma, traumatic brain injury, and Gulf War illness. According to a 2021 Government Accountability Office (GAO) report, about 1.1 million of the 1.4 million exams completed in fiscal year 2020 were handled by outside physicians, who were projected to receive more than $6.8 billion for this work over a ten-year period.

Unfortunately for veterans, the GAO found that “exam reports for selected complex claims were returned to [outside] examiners for correction or clarification at about twice the rate that exam reports were returned overall.” This faulty work results in additional claims processing delays and makes it even harder for overburdened VBA staff to assign fair and accurate disability ratings—which are themselves subject to further administrative and legal appeals, often dragging on for years.

Other members of the AFGE and National Nurses United (NNU) warn that VHA outsourcing has left their hospitals and clinics understaffed, drained of resources, and, in some cases, facing the threat of facility closings. Begun under President Barack Obama, the ever-expanding privatization of veterans’ health care got a big boost in 2018, with passage of the VA MISSION Act, a Republican legislative victory aided by many Congressional Democrats.

This enabled Trump’s VA Secretary, Robert Wilkie, to promulgate new administrative rules that opened the floodgates for patient referrals outside the VHA. To further accelerate privatization, Wilkie intentionally left tens of thousands of VHA caregiving jobs unfilled. When Biden ran for President three years ago, he promised veterans he would fill those vacancies and, unlike Trump, never try to defund, “dismantle,” or “privatize” the VA. But by 2022, almost one-third of the VHA’s total annual budget was being diverted from direct care to reimbursement of 1.2 million private-sector providers, whose treatment is often costlier and, studies show, far less effective.

In a report to Congress last September, McDonough made the alarming, but accurate, prediction that the “VA is rapidly approaching a point where one-half of all care” will be outsourced. In the same document, he acknowledged that in-house care is cheaper, faster, of higher quality, and preferred by veterans themselves. Unfortunately, McDonough has neither revised Wilkie’s patient referral rules nor acted swiftly enough to fill a reported 59,000 VA vacancies.

Ending the severe shortage of VHA caregivers—documented in a VA Office of Inspector General’s report last July—is essential for proper in-house treatment of PACT Act patients. But rapid recruitment of new employees has been impeded by a Trump-era human resources modernization scheme that made the VA’s notoriously cumbersome hiring process worse, not better. That failed experiment centralized control over new hiring, reduced the role of local HR staff, and replaced person-to-person contact with an online system that McDonough continues to employ.

McDonough’s inaction on this and other fronts is a subject of great concern among frontline VA staffers, a third of whom are veterans. “We know that the VA delivers care that is far superior to the private sector, particularly when it comes to emergency care,” wrote James Martin, a VA physician in Chicago who previously worked in non-VA hospitals. “So why are we sending so many patients out to the private sector? Why is my job caring for them becoming harder?”

By 2022, almost one-third of the VHA’s total annual budget was being diverted from direct care to reimbursement of 1.2 million private-sector providers.

In southern West Virginia, AFGE Local 2198 President Melissa Miklos says her facility not only is seriously understaffed, but also is slated to lose funding for already approved and scheduled construction projects. Because of MISSION Act-mandated outsourcing, 65 percent of the patients already served by the Beckley VA Medical Center now get outside appointments, whether they want them or not. So, not surprisingly, regional VHA leaders now tell Miklos there is no way they can justify adding “another square foot to the Beckley VA.” 

Because of this, she fears that PACT Act patients with respiratory problems will have trouble accessing needed care inside or outside the VHA. Miklos says there is only one pulmonologist at the Beckley VA Medical Center, and “he will be unable to handle the new patient load.” Things are even worse in the private sector, she reports, because local wait times to see a pulmonologist can be six to eight months.

Irma Westmoreland, the VA chair of NNU, says that her own VA medical center in Augusta, Georgia, and many others must hire more nurses to deal with the growing influx of new patients. Unless McDonough overhauls the VA’s current HR system, that won’t happen anytime soon, she believes.

“You can’t get in touch with an HR person in a local facility,” Westmoreland tells us. “You call and no one returns your calls. It’s taking months to hire a doctor or nurse. Nurses aren’t going to wait for months for a VA job when they can get one at a private-sector hospital or sign up with a temp agency and earn thousands and thousands more than at the VA. We want these patients but there are not enough people to take care of them.”

As a former White House staffer under President Obama, McDonough knows better than anyone that overseeing an expansion of benefit eligibility and related care can be a risky assignment if the VA is not mission-ready. In 2010, Obama’s first VA Secretary, retired four-star general and Vietnam veteran Eric Shinseki, added just three—much fewer than the PACT Act’s twenty-three—new health conditions to an existing list of maladies linked to Agent Orange, the toxic herbicide widely used as a defoliant in Vietnam. Much applauded by veterans’ organizations, this allowed additional Vietnam-era veterans to qualify for VHA coverage.

But the VBA was soon inundated with new claims, creating a huge backlog. As more claimants succeeded in getting health care access, VA hospitals—still struggling to cope with an influx of younger veterans recently returned from the post-9/11 wars in Iraq and Afghanistan—faced heavier patient loads. At one short-staffed medical center in Arizona, this resulted in appointment delays that local administrators sought to conceal to protect their own bonuses (the VA offered financial incentives for quicker care). In the wake of sensationalistic national media coverage of this local cover-up, Obama sacked Shinseki, despite an otherwise positive record of accomplishment. And the door was opened for privatization as a solution to real or imagined VA shortcomings.

That history is relevant today. Republicans on Capitol Hill, who are even bigger advocates of VA outsourcing than the Democrats who have supported it, will quickly become opportunistic critics of any PACT Act implementation problems. The GOP will try to turn those failings into partisan advantage in 2024, particularly if Biden ends up running for re-election against an Iraq War veteran, former Navy lawyer, and former reservist from Florida named Ron DeSantis.

Biden can avoid that predictable flak only by living up to his own 2020 campaign promises and more recent PACT Act press releases. But that requires more insourcing of veterans’ services, rather than further outsourcing of essential VA functions. The for-profit hospital chains and medical practices now benefiting from privatization will fiercely oppose this change in course. But most veterans will strongly applaud efforts to properly staff and fund their own health care system, rather than turn it into a piggy bank for the private health care industry. 

Editor's Note: Suzanne Gordon is co-founder of the Veterans Healthcare Policy Institute, which contracted with the American Federation of Government Employees to conduct the Department of Veterans Affairs employee survey mentioned in this story.

Suzanne Gordon is co-founder of the Veterans Healthcare Policy Institute. She and Steve Early are freelance journalists and co-authors with Jasper Craven of 'Our Veterans: Winners, Losers, Friends, and Enemies on the New Terrain of Veterans Affairs.'

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