The Department of Veterans Affairs (VA) has improved its quality of healthcare through management initiatives and use of health IT, according to an interim report from the Congressional Budget Office (CBO).

The CBO’s recognition of the VA's accomplishments comes during a period of increased demand for its services from soldiers returning from Afghanistan and Iraq.

CBO conducted this review at the request of the chairmen of the House Veterans' Affairs Committee and the House Appropriations Committee’s Military Construction, Veterans Affairs and Related Agencies Subcommittee.

The CBO said that the VA has restructured efforts to permit more shared decision-making among its central office, regional managers and facility directors; measure performance, process and outcomes; and use health IT system wide.

The department's integrated structure and appropriated funding may have helped it focus on providing the best quality care for a given amount of money compared with fee-for-service incentives toward billable services and procedures, CBO said in the report, dated Jan. 9.

The improvement in the VA's healthcare quality has been documented in a number of independent studies, including by the Institute of Medicine. The VA expects to provide care to more than 5.8 million veterans this year in its 153 hospitals and nearly 900 clinics.

The VA tracks the quality of its care using indicators such as adherence to clinical guidelines and standards that have been shown to improve outcomes, waiting times for access to services and customer satisfaction. This year, the VA plans to adopt more industry-wide quality measures, such as those in the Healthcare Effectiveness Data and Information Set, to boost comparability with other providers, CBO said.

The structure of the VA, as an integrated healthcare system, makes it easier for the department to use two effective tools: incentives for managers and providers to meet quality of care and practice guideline targets, and health IT systems that provide reminders about tests and treatments recommended by the practice guidelines, CBO said. It also found that the low cost of care for veterans was an incentive for seeking care.

Most payment systems for healthcare do not align incentives well with quality. Health insurance plans often pay providers based on the number of services performed instead of the quality of the care delivered.

“In most cases, providers are not directly reimbursed for investments in quality,” said Allison Percy of CBO’s National Security Division, who authored the report. These investments include purchases of health IT to track adherence to clinical guidelines or spending on education and training to improve compliance with safety protocols.