Prevalence and Costs of Chronic Conditions in the VA Health Care System

Abstract

Chronic conditions are among the most common causes of death and disability in the United States. Patients with such conditions receive disproportionate amounts of health care services and therefore cost more per capita than the average patient. This study assesses the prevalence among the Department of Veterans Affairs (VA) health care users and VA expenditures (costs) of 29 common chronic conditions. The authors used regression to identify the marginal impact of these conditions on total, inpatient, outpatient, and pharmacy costs. Excluding costs of contracted medical services at non-VA facilities, total VA health care expenditures in fiscal year 1999 (FY1999) were $14.3 billion. Among the 3.4 million VA patients in FY1999, 72 percent had 1 or more of the 29 chronic conditions, and these patients accounted for 96 percent of the total costs ($13.7 billion). In addition, 35 percent (1.2 million) of VA health care users had 3 or more of the 29 chronic conditions. These individuals accounted for 73 percent of the total cost. Overall, VA health care users have more chronic diseases than the general population.