VA Health Care

All pharmacies run by the Department of Veterans Affairs (VA) provide medications and medical supplies that are available over the counter through other local outlets. The most frequently dispensed over-the-counter products include (1) medications, such as aspirin and insulin; (2) dietary supplements, including Sustacal and Ensure; and (3) medical supplies, such as alcohol prep pads, lancets, and glucose test strips. Unlike VA, public and private health plans cover few, if any, over-the-counter products for their beneficiaries. VA pharmacies dispensed over-the-counter products more than 15 million times during fiscal year 1995 at an estimated cost of $165 million, including handling costs of $48 million. VA recovered about $7 million through veterans' copayments, or about four percent of its total over-the-counter costs. Although many veterans shared a modest portion of the costs and some paid the full amount, most veterans paid nothing. GAO suggests several ways that VA could cut costs associated with dispensing over-the-counter products or boost revenues from copayments. First, VA could more narrowly define when to provide over-the-counter products. Second, VA could more efficiently dispense over-the-counter products and collect copayments. Third, VA facilities could further reduce the number of over-the-counter products available to veterans on an outpatient basis. Finally, Congress could expand copayment requirements.

GAO found that: (1) all VA pharmacies provide some OTC products that are available through other local outlets; (2) the most frequently dispensed OTC products were medications, dietary supplements, and medical supplies; (3) individual VA pharmacies offer a different assortment of OTC products; (4) some pharmacies restrict which veterans may receive OTC products or in what quantity; (5) other public and private health care plans cover few, if any, OTC products for beneficiaries; (6) in fiscal year (FY) 1995, VA pharmacies dispensed OTC products more than 15 million times at an estimated cost of $165 million, including $48 million in handling costs; (7) VA recovered about $7 million through veterans' copayments; and (8) to reduce the resources devoted to dispensing OTC products, VA could more narrowly define when to provide OTC products, more efficiently dispense OTC products and collect copayments, and further reduce the number of OTC products dispensed on an outpatient basis.

Recommendations

Our recommendations from this work are listed below with a Contact for more information. Status will change from "In process" to "Open," "Closed - implemented," or "Closed - not implemented" based on our follow up work.

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