WASHINGTON — An Obama administration proposal to bill veterans' private insurance companies for combat-related injuries has prompted veterans groups to condemn the plan as unethical, and powerful lawmakers on Capitol Hill have promised to oppose it.
Nevertheless, the White House confirmed Tuesday that the idea remained under consideration, and a meeting to discuss it further is scheduled for Thursday between Chief of Staff Rahm Emanuel and leaders of veterans groups.
The proposal -- intended to save the Department of Veterans Affairs $530 million a year -- would authorize the VA to bill private insurance companies for treatment of injuries and medical conditions related to military service, such as amputations, post-traumatic stress syndrome and other battle-related conditions. The VA already pursues so-called third-party billing for non-service-related conditions.
Veterans groups said the change would abrogate the government's responsibility to care for the war-wounded. And they expressed concern that the new policy would make employers less willing to hire veterans for fear of the cost of insuring them, and that insurance benefits for veterans' families would also be jeopardized.
Lawmakers explicitly ruled out the proposal Tuesday in budget recommendations from the Senate and House Veterans Affairs committees.
The chairman of the Senate committee, Daniel K. Akaka (D-Hawaii), said a majority of the committee members rejected the plan as fundamentally unfair.
"America's veterans and their families pay the true cost of war every day, and we must pay for the care and benefits they have earned. I look forward to working with my colleagues and the administration to pass a budget worthy of their service," Akaka said in a statement.
Sen. Patty Murray (D-Wash.), a senior member of the Veterans Affairs and Budget committees, warned Veterans Affairs Secretary Eric K. Shinseki last week that the idea would be "dead on arrival," and she vowed Tuesday that any budget containing the VA provision was "not going to pass."
"The VA has an obligation to pay for service-related care, and they should not be nickel-and-diming vets in the process," she said in an interview. "This proposal means that family members will be hurt because, if a vet meets the maximum [benefit amount] for their insurance, their wife and kids would not be able to get insurance [benefits] any more. . . . God forbid a wounded vet from Iraq has a wife who gets breast cancer."
White House Press Secretary Robert Gibbs said Tuesday that the Obama administration had not yet made "the final . . . decision on third-party billing as it relates to service-related injuries."
At the same time, Gibbs noted that the administration was seeking an 11% increase in discretionary spending in the VA budget, a decision lawmakers and veterans groups had praised. "This president takes very seriously the needs of our wounded warriors that have given so much to protect our freedom on battlefields throughout the world," Gibbs said at a White House news conference.
Veterans groups described the plan as a puzzling political misstep by the new administration in its relations with the 25 million Americans who have served in the military. Obama heard firsthand about such objections Monday when he met with leaders of the groups at the White House.
"To ask veterans to save $500 million in a [VA] budget of over $100 billion is not only bad policy, it is bad politics," said Paul Rieckhoff, executive director of Iraq and Afghanistan Veterans of America.