Veterans' Health Care

In June 1996, the Department of Veterans Affairs (VA) announced the integration of two Chicago hospitals--Lakeside and West Side hospitals--under one director. These hospitals became the VA Chicago Health Care System within the Great Lakes network, which encompasses parts of Illinois, Indiana, Michigan, and Wisconsin. The Great Lakes network runs eight hospitals and 12 outpatient clinics. Lakeside and Westside, which are located about six miles apart in downtown Chicago, provide acute inpatient medical, surgical, and psychiatric care. Both hospitals are affiliated with medical schools. This report examines the effect that the integration has had on veterans, employees, and medical schools in the Chicago area. GAO describes (1) the VA Chicago Health Care System's integration process; (2) the integration decisions made; (3) the impacts on veterans, employees, and medical schools; and (4) the dollar savings resulting from these decisions.

GAO noted that: (1) the VACHCS integration process, which began in 1996, included 28 work groups that studied administrative, patient support, and direct care services and made recommendations to an Integrated Coordinating Committee (ICC); (2) the ICC reviewed, reworked, and modified work group recommendations; (3) work group recommendations approved by ICC were sent to the VACHCS director for review, approval, and implementation; (4) recommendations involving changes to clinical services were also reviewed and approved by the Great Lakes network director and the Veterans Health Administration Under Secretary for Health; (5) VACHCS involved stakeholders in its integration process; (6) the VACHCS integration: (a) unified the management of 16 services; (b) reengineered 23 services by standardizing operating policies, practices, and databases or by establishing more efficient practices; and (c) consolidated parts of eight services in a single location; (7) the integration appears to have had a small but positive impact on veterans, employees, and medical schools; (8) VACHCS officials report that they have maintained the level of service to veterans and, in some instances, even improved access and quality while minimizing the hardship on VA employees by not dismissing any current employees; (9) medical school affiliations remain largely unchanged, and medical education continues to be provided at both hospitals, using the same management structure and operating practices; (10) the VACHCS integration saved about $7 million; and (11) VACHCS saved about $4 million by eliminating 80 positions, of which 74 were vacant, and approximately $2 million by avoiding the purchase of duplicate equipment and related construction.