Reliance on Medicare Providers by Veterans after Becoming Age-Eligible for Medicare is Associated with the Use of More Outpatient Services

Abstract

Objective: To estimate the effect of Medicare use on the receipt of outpatient services from 2001 through 2015 for a cohort of Veterans Administration (VA) users who became age-eligible for Medicare in 1998-2000.

Data sources/study setting: VA administrative data linked with Medicare claims for veterans who participated in the 1999 Large Health Survey of Enrolled Veterans.

Study design: We coded each veteran as VA-reliant or Medicare-reliant based on the number of visits in each system and compared the health and social risk factors between VA-reliant and Medicare-reliant veterans. We used bivariate probit and instrumental variables models to estimate the association between a veteran's reliance on Medicare and the receipt of outpatient procedures in Medicare and the VA.

Principal findings: Veterans who chose to rely on the VA (n = 4,317) had substantially worse social and health risk factors than Medicare-reliant veterans (n = 2,567). Medicare reliance was associated with greater use of outpatient services for 24 of the 28 types of services considered. Instrumental variable estimates found significant effects of Medicare reliance on receipt of advanced imaging and cardiovascular testing.

Conclusions: Expanded access to fee-for-service care in the community may be expensive, while the VA will likely continue to care for the most vulnerable veterans.

Keywords: Veterans Administration; ambulatory procedures; community care; medicare.