Summary: In a 1977 report to the Senate Committee on Veterans' Affairs, the Veterans Administration (VA) opposed proposed legislation concerning changes in pharmacy service to nonhospitalized veterans, because its method of dispensing drugs to these patients was satisfactory and economical, and the enactment of this legislation would increase the cost of providing such drugs and medicines over a 5-year period to more than $135 million for fee-basis prescriptions and more than $851 million if all outpatient prescriptions were included. VA estimated that all future prescriptions would be filled by private pharmacies, and that the prescription volume would increase 17 percent each year.
GAO discussed this report with VA officials and reviewed pertinent records, reports, and other documents. Previously, GAO reported that generally drugs were dispensed in a timely manner and that the fee-basis program was more costly than VA pharmacy prescriptions at six VA facilities. It appears that the VA position that its method of providing drugs and medicines is satisfactory and economical is reasonable. VA projection that the volume of prescriptions would increase by 17 percent each year, based on the recorded percent of growth of outpatient prescriptions filled by VA pharmacies, is reasonable. GAO agrees with VA that the proposed legislation would increase the cost of dispensing drugs. Of the 219 VA facilities providing outpatient prescription services, 80 have been designated clinics of jurisdiction responsible for managing the fee-basis program within a specified area. VA personnel costs for outpatient prescription services was $38,076,600 for fiscal 1978. Costs of drugs, medical supplies, and other nonpersonnel costs were estimated to be $147,039,800. The fee-basis prescription costs for fiscal 1978 were $10,840,371 and included $182,678 in VA processing costs.
