Veteran’s disability payments led to fewer hospitalizations

Increased disability payments led to fewer hospitalizations for Vietnam veterans with diabetes, finds a study led by Dr. Amal Trivedi at Providence Virginia Medical Center. In 2001, a victim assistance policy change increased disability payments for Vietnam veterans with diabetes. Researchers examined 14,000 Vietnam veterans eligible for these payments and found that they had a 21% reduction in hospital admissions, compared to a control group. However, they did not see lower mortality rates as a result of increased compensation. The researchers concluded, “Disability compensation payments may have important health benefits for veterans.”

Results Back On June 13, 2022, in the magazine Gamma Internal Medicine.

Low income linked to poor health

In 2001, the VA made diabetes a default requirement for disability compensation. Veterans who served with “boots on the ground” in Vietnam, Cambodia, and Laos during the Vietnam War were eligible. The decision was based on the Institute of Medicine Report which found a possible association between exposure to Agent Orange and diabetes.

Previous research has shown that people with lower incomes generally have worse health and die sooner than those with higher incomes. While income has been linked to health, little is known about how VA disability payments directly affect veterans’ health. Most previous studies have focused on the impact of disability compensation on things such as veterans’ employment decisions, rather than on direct health outcomes.

To fill this knowledge gap, researchers looked at data from more than 70,000 Vietnam-era diabetes veterans. Of these, more than 14,000 are eligible for diabetes compensation under the 2001 policy change.

Higher compensation and less hospitalization after policy change

Veterans who were newly eligible for disability compensation had “marked reductions” in hospitalization after policy age, compared with those who did not qualify, according to the study. In the group receiving diabetes reimbursement, hospitalization decreased by 10% soon after the policy change. The same group reported a 21% decrease in hospitalizations by 2018, which is the end of the study period.

As a result of the new policy, eligible veterans received more than $17,000 in annual disability compensation by 2018, compared to non-eligible veterans.

These increased payments could improve the economic factors affecting the health of veterans, according to Trivedi. “By providing a stable source of income, disability compensation can be the difference between providing stable housing, getting food, or prescription medications,” he said. “These are things that can help keep veterans out of the hospital.”

While policy makers may be concerned about the cost of increasing disability compensation, the researchers noted that their findings suggest that the cost of increased disability payments may be offset by reduced hospital visits and associated costs. Trivedi explains, “As policymakers consider potential changes to veteran disability compensation programs, we provide evidence that compensation payments significantly reduce hospitalizations for veterans—particularly those funded by Medicare. This means that disability compensation may lead lead to significant reductions in public spending on hospital care.”

The study also found that the relationship between disability payments and fewer hospitalizations was not affected by race, ethnicity, socioeconomic status, or other health conditions.

Disability allowance is not associated with lower mortality

The lower hospitalization rates did not translate into lower death rates for the veterans in the study, the researchers said. Annual mortality rates were similar in the study group regardless of eligibility for diabetes compensation.

The researchers suggested several possible explanations for why mortality rates did not decline with hospitalization. It could be because of the VA being an equal access healthcare system. The relationship between low income, poor health and death can be caused by the lack of proper health insurance, which is less of a problem in the victim assistance system. And the health benefits of higher incomes may be less evident in middle-aged or older adults, affecting younger groups more.

While larger disability payments did not result in significantly lower mortality, death rates were similar in both groups of veterans. This led the researchers to conclude that “the lack of a mortality difference despite large and ongoing compensation payments should mitigate expectations that increased incomes among middle-aged or older adults will always improve life expectancy.”

The researchers went on to note that although previous evidence suggested that disability compensation was associated with lower rates of veteran employment, the study “should reassure policy makers that the exit of veterans from the labor market was not associated with an increased risk of mortality.”

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