Arizona Eagletarian

Arizona Eagletarian

Friday, August 8, 2014

Why, really, did Robert McDonald come to Phoenix and when will the VA disclose the financial impact of impending privatization?

WAR is a racket. It always has been. It is possibly the oldest, easily the most profitable, surely the most vicious... It is the only one in which the profits are reckoned in dollars and the losses in lives.
A racket is best described , I believe, as something that is not what it seems to the majority of people. Only a small "inside" group knows what it is all about. It is conducted for the benefit of the very few, at the expense of the very many. Out of war a few people make huge fortunes. -- Smedley D. Butler, Major General (ret.), USMC; from War is a Racket, first published in 1935 
General Butler says about himself in the book,
I spent 33 years in the Marines, most of my time being a high-class muscle man for big business, for Wall Street and the bankers. In short, I was a racketeer for Capitalism. 
Butler's book and an introduction to it recount an attempted coup against President Franklin D Roosevelt because Big Business feared the New Deal.

Then, when Lyndon Johnson succeeded in ushering Civil Rights and Voting Rights legislation through Congress in the 1960s, Big Business again freaked out. This time, the response was the now infamous 1971 Powell Manifesto, written by Lewis Powell, who shortly thereafter was appointed to be an associate justice of the Supreme Court.

Not long after Powell's call to Chambers of Commerce to begin organizing the political power of money, ALEC formed and over the subsequent 40+ years has been advocating heavily for cutting taxes, eliminating regulation (this was shortly after enactment of the Clean Air Act and Clean Water Act) and privatizing everything that government does.
Although the predominant myths about PRIVATIZATION (whether of prisons or anything else) claim that privatization means tax savings for the public, it actually costs us more. Even though on paper a private agency or corporation may present a lower figure to do the same job, once that money has been taken out of the public's hands, it no longer remains ours. 
In the public sector, tax money tends to make more of itself, meaning that each public dollar paid through one social service will spend itself four to eight times more elsewhere within the public sector. Once public money goes into private hands however, that money stays there and is gone for good. This is especially true if we consider that privatization corporations are usually given handsome tax breaks and "incentives," in the form of what some people call "corporate welfare," which means we are even less likely to see that money again.
This brings me to the VA scandal, broken open by whistleblowers at the Phoenix VA Medical Center in April and reported first by the Arizona Republic. It's likely the reporters who worked that story will be recognized with awards, maybe even a Pulitzer. Their reporting brought pressure to bear on what ended up being a nationwide problem. Congress, notorious over the last couple of years for accomplishing NOTHING, actually held hearings, called VA executives to account and passed a substantive reform bill that will get veterans who had been falling through cracks (crevasses really) expedited primary and specialty care. This is all a very good thing.

To bridge the gap and provide the necessary care NOW for veterans, the VA entered into a contract with privateer TriWest Health Services, a corporate bureaucracy. That's not a joke and not hyperbole. TriWest makes its money by making appointments for veterans with private doctors. It's a paper pushing bureaucracy. TriWest adds ZERO value to the experience an individual patient has with his or her private doctor.

And I have personal experience with TriWest.

In January this year, my primary care doctor (at the VA) referred me for a consultation with a specialist. The doctors who had been working within the Phoenix VAMC in this specialty had either retired or moved away. In February, I received a letter from the VA's fee basis office authorizing the consultation with a private specialist, saying I could go to any doctor in this specialty I wanted to see. A few days later, I received a call from TriWest saying they wanted to make the appointment for me.

Long story short, I was authorized by the VA to make my own appointment, but David McIntyre's private bureaucracy wanted to make money by doing it for me. At the time, I didn't know better, so I let them. Several awkward mistakes by TriWest later, and I had been seen twice by the specialist who ended up only changing a medication for me.

One of TriWest's mistakes was in failing to provide clear instructions to the doctor on how he would get paid. As a result, the doctor billed me. For a fifteen minute consultation, the bill was more than $300.00. I saw him twice. To straighten out the billing problem, Congressman David Schweikert's constituent services staff had to get involved. So, at minimum, the VA paid the private doctor more than $600. That total does not include fees paid to TriWest to open the phone book and find a physician to call and make the appointment.


In the 1990s, working as an accountant for an agency of the State of Arizona, the concept of privatization was front and center. It was a fad even then and the Republican controlled legislature passed an aggressive plan to privatize our state's welfare delivery system (safety net programs).

Government contractor Maximus won the bid for the pilot project to cover several offices in the Phoenix metro area. Not surprisingly, the project did NOT save Arizona taxpayers any money and the project was scuttled. More than 16 years later however, Maximus continues to push its corporatist operation all over the world, currently reporting a whopping third quarter 26 percent increase (to $419.9 million) in revenue over the same period last year.

This is NOT free market, folks. This is crony capitalism. The ONLY place Maximus sells its services is to governments. The only revenue, taxpayer funds.

Now, I don't know how much McIntyre's private bureaucracy cost taxpayers, but there are a few related items we can know. First, McIntyre, in response to questions while testifying before the House Veterans Affairs Committee in June told Congress that HE "paid $20 million for the privilege" of providing the service to the VA. During his opening statement, he told the committee that they should expect "candor, openness and collaboration from all of us." But when ever he or anyone from the VA was asked (and they were asked many times) about how much this contract would cost taxpayers, the response was not candor and openness. In fact, it was never answered. One has to ask, why would McIntyre "pay $20 million for the privilege..." if he's CEO of a FOR PROFIT corporation?

VA assistant deputy undersecretary Philip Matkovsky specifically declined to answer those questions. He improperly cited the concept "privity of contract." In the context of his response, Matkovsky implied that the expression meant that he was required to NOT disclose costs or answer the questions. But that's not what the expression means. To my knowledge, Matkovsky was never challenged for having lied to Congress. He's not the only VA executive who testified before House Veterans Affairs who lacked candor. But in all cases this summer, apparently the worst consequences any of them faced was stern language from committee members.

TriWest has an exclusive, no-bid contract with the VA to duplicate bureaucratic services in (according to McIntyre's opening statement) 28 western states. The other states are covered by a contract with HealthNet.

The bottom line is that massive additional costs to taxpayers have and will continue to accrue as long as and to the extent that the VA is unable to cope with the increased demand. The economics of the situation indicate that David McIntyre along with whoever else holds an ownership interest in TriWest, will be making a killing off of the taxpayers. We just don't know to what extent because nobody has been able to press for disclosure.

At minimum, the VA and TriWest should be made to disclose the cost to taxpayers for this duplication of services. To clarify, I could have just as easily opened the phone book and found a doctor to go to for the specialty care. And I would not have charged an arm and a leg to do so.

Now, back to the Arizona Republic. A few months ago, when the scandal was still ramping up, I was in touch by email with Craig Harris, Dennis Wagner and Paul Giblin. They ultimately did express that they understood my concern but were, for whatever reason, unable or unwilling to explore this brazen bilking of taxpayers.

It's likely the choice was not theirs. Republic editorialists Robert Leger and Doug MacEachern wrote up a front page editorial declaring what they believe needs to be done to fix the situation(s) at the VA in Phoenix and beyond.
That is the approach recommended by Dr. Gail R. Wilensky, one of the nation's foremost authorities on reforming public-health systems. "Over time," she told us, the VA "should allow the private sector to take on veterans' other medical needs," while focusing on "those conditions that require complex interventions that are directly related to war injuries."
The economics of the situation point in the exact opposite direction to what the Republic believes should be done. That's likely behind the fact that Harris, Wagner and Giblin won't follow up and report on what the public needs to know about it all now that the scandal is winding down.


Now, today, newly confirmed VA Secretary Robert McDonald came to Phoenix. News media declared that he was here to hear from veterans. McDonald even said he was here to hear from the patients. But somebody isn't telling the truth.
"I'm really pleased to be here in Phoenix. It was important for me to come to Phoenix first to hear first-hand from our patients the veterans and the Veterans Affairs employees who are caring for them...
Upon hearing about this event, and because this has the potential to impact taxpayers for hundreds of millions of dollars, I contacted the VA by way of the patient advocate office and the director's office requesting to be invited to the meeting McDonald had with (as the director's office put it) stakeholders. An email response I received read,
Mr. Muratore, the Secretary is not meeting individually with Veterans today. The purpose of his visit to the Phoenix VA Health Care System is to impart his vision to employees and leadership and to see for himself the challenges Phoenix VA Health Care System faces in meeting that vision in order to better plan so the Veterans Health Adminstration can meet that vision. Rex Patterson Patient Advocate 
So, which is it, Mr. Secretary, did the local VAMC staff lie to you or did you lie to the cameras and reporters in the press conference?

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