Policy changes in the mid-1990s sent veterans to outpatient facilities for treatment, mirroring trends in the overall U.S. health care system.

Substance use disorders are a major problem among the nation's veterans. The U.S. Department of Veterans Affairs(VA), which provides health care to more than three million veterans, is the nation's largest provider of substance abuse treatment. The VA trains large numbers of physicians and other mental health professionals; it plays an important role in defining standards of mental health care in the United States.

In the past decade several initiatives have transformed the VA. These policies were inspired by changing views about the role and size of government and by growing use of managed care. This paper considers the effect of these changes on specialized VA programs for substance abuse treatment.

Sara J. Singer, Alan M. Garber,and Alain C. Enthoven have designed a comprehensive, new approach for expanding access to health insurance. The proposal is built on the following key elements:

THE PLAN WOULD PROVIDE near-universal coverage by making private plans more affordable and helping low- and middle-income people buy coverage. This would be accomplished though tax credits and by creating “insurance exchanges” that would provide health insurance choices and promote competition among health plans.

INSURANCE EXCHANGES WOULD BE OPERATED by public or private entities or employers (for their own employees). Exchanges would offer individuals a choice of at least two health plans in every geographic region at community- rated premiums. The “U.S. Insurance Exchange”would be established to serve individuals and companies with fewer than 50 employees in areas where private exchanges do not emerge. Coverage purchased through exchanges would be exempt from state small-group reform laws and insurance mandates.

LOW- AND MIDDLE-INCOME AMERICANS who purchase insurance through an exchange would receive refundable tax credits valued at 70 percent of the median-cost plan. The credits would apply only for coverage purchased through the exchanges. Eligible low-income individuals who did not enroll in a health plan would be automatically enrolled in a federally funded default plan organized by the state. Other individuals would continue to exclude from taxable income their individual or employer-paid health insurance contributions, but a phased-in cap would limit this exclusion.

A NEW “INSURANCE EXCHANGE COMMISSION” would be created. It would be similar to the Securities and Exchange Commission—having authority to distribute tax credits and default payments, accredit insurance exchanges, risk-adjust premiums across insurance exchanges, and serve as an information clearinghouse for consumers.

Healthcare quality has received heightened attention over the last decade, leading to a growing demand by providers, payers, policymakers, and patients for information on quality of care to help guide their decisions and efforts to improve health care delivery. At the same time, progress in electronic data collection and storage has enhanced opportunities to provide data related to health care quality. In 1989, the Agency for Health Care Policy and Research (AHCPR, now the Agency for Healthcare Research and Quality, AHRQ) initiated the Healthcare Cost and Utilization Project (HCUP). HCUP is an ongoing federal-state-private collaboration to build uniform databases from administrative hospital-based data collected by state data organizations and hospital associations.

The HCUP quality indicator set, developed in 1994, and hereafter referred to as HCUP I, consists of 33 measures, constructed using administrative data available in the NIS. Included in the set are indicators of utilization of procedures, ambulatory care sensitive condition admissions, post-operative and other complications, and mortality.

Since the original HCUP QI development work in 1994, numerous managed care organizations, state Medicaid agencies and hospital associations, quality improvement organizations, the Joint Commission for the Accreditation of Healthcare Organizations (JCAHO), the National Committee on Quality Assurance (NCQA), academic researchers and others have contributed substantially to the knowledge base of hospital quality indicators. Based on input from current users and advances to the scientific base for specific indicators, AHRQ decided to fund a research project to refine and further develop the HCUP QIs.

As a result, AHRQ charged the UCSF-Stanford Evidence-based Practice Center (EPC) to revisit the initial 33 indicator set (HCUP I QIs), evaluate their effectiveness as indicators, identify potential new indicators, and ultimately propose a revised set of indicators. This report documents the evidence project to develop recommendations for improvements to the HCUP I indicators.

A holistic approach to the financial problems of the elderly focuses simultaneously on their expenditures that are self financed as well as those that are financed by transfers from the young (under age65). It also focuses simultaneously on paying for health care and paying for other goods and services. The income and health care expenditures not paid from personal income, provides a useful framework for empirical application of the holistic approach. In 1997, approximately 35 percent of the elderly's full income was devoted to health care; 65 percent to other goods and services. Approximately 56 percent of full income was provided by transfers from the young and 44 percent by the elderly themselves. The paper shows how these percentages might change under alternative assumptions about the growth of health care relative to other goods and services and the effect of these changes on the need for more saving and more work prior to retirement.