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Takeaway: Veterans enrolled in VHA who also have Medicare coverage have two government sources of healthcare financing. This system has raised concerns that dual enrollment may be a source of significant excess federal spending for Veterans who opt for Medicare Advantage (MA) since MA plans receive capitated payments for healthcare services without having these payments reduced if Veterans receive care in VHA. An HSR-funded study found that from 2011–2020, VHA spending for VHA-MA enrollees increased from $4.6 billion to $12.1 billion as the number of VHA-MA dual enrollees who used VHA services increased by 63%. The study prompted a Wall Street Journal investigation on this issue and increased awareness of the possibility that the federal government might be paying twice for some of the healthcare provided to Veterans who are dual enrollees, resulting in bipartisan federal legislation being proposed that would permit VA to charge MA insurers for medical care.
Veterans enrolled in VHA who also have Medicare coverage have two government sources of healthcare financing. They can receive services from VHA clinicians and facilities as well as care purchased in the community that is paid for by VA, or they can have their care covered by Medicare, which is billed only if a Veteran is treated for a non-VHA covered service. Payment challenges arise for dual VHA/Medicare enrollees who opt for Medicare Advantage (MA) because MA plans receive capitated payments for healthcare services without having these payments reduced if Veterans receive care in VHA. This system has raised concerns that VHA/MA dual enrollment may be a source of significant excess spending. Further, VHA is prohibited from billing MA insurers for the care VHA provides to dual enrollees.
An HSR-funded study published in October 2024 showed that from 2011–2020, the number of VHA-MA dual enrollees who used VHA services increased by 63%, and total VHA spending for dual enrollees using VHA care increased from $4.6 billion to $12.1 billion. The findings highlighted the redundant payments caused by dual enrollment and how current federal policy affects VA’s healthcare system. Co-authored by HSR investigators David Meyers, PhD, MPH; Aaron Schwartz, MD, PhD; Jean Yoon, PhD; and Amal Trivedi, MD, MPH, the study was featured in an HSR CO publication brief and was nominated for HSR’s 2024 Best Research Paper of the Year Award.
The HSR study inspired a Wall Street Journal investigation, which prompted a bipartisan group of lawmakers to introduce legislation in June 2025 that would allow VHA to bill MA insurers for VA care that is provided to dual enrollees. If passed, the proposed legislation will close a loophole in the current system that allows insurers to charge Medicare billions of dollars for Veterans’ care that is provided through VA.
Spending by the Veterans Health Administration for Medicare Advantage Dual Enrollees, 2011–2020. JAMA. October 2, 2024; online ahead of print.
Lawmakers Seek to Close VA Loophole that Funnels Billions to Private Medicare Insurers. The Wall Street Journal. June 23, 2025.
