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CareSource to expand into veterans health care

CareSource is planning to expand into veterans health care through a new business deal.

The Dayton-based insurer announced today that it was chosen by Amvets, a national veterans organization, to develop a privately managed health insurance plan for veterans seeking health care outside the VA system.

The business deal is a result of the sweeping $51 billion VA Mission Act signed into law in June by President Donald Trump, which made it easier for veterans to get coverage for health care received outside the VA.

PREVIOUS COVERAGE: VA may expand private health care choices for veterans

CareSource already manages Medicaid and Medicare plans as well as sells individual health insurance plans on the Affordable Care Act exchanges.

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It’s not yet clear what the new insurance line will mean in terms of jobs or revenue for the Dayton-based nonprofit, which is constructing a second downtown office building.

But while the details are still being worked out, the law opens the door for the insurer to add more clients and grow.

“The opportunity is quite large,” Erhardt Preitauer, CareSource president and CEO, told the Dayton Daily News.

The veterans health insurance plan — which is still under development — will be using the managed care model.

Managed care generally involves taking health benefits programs that had been directly managed by government agencies and shifting the management of those health plans to the private sector. The private insurance companies get a flat rate from the government per patient per month.

MORE: Trump’s pick to head VA: Time to ‘shake up’ department

“CareSource is honored to have the opportunity to serve American heroes through the development of a new and innovative model that will ensure our veterans have choice and access to the health care that they so richly deserve,” stated Preitauer. “CareSource’s vast experience working with special populations makes us uniquely qualified to support veterans through innovative health and life services programs.”

In addition, Preitauer said the large veterans population in the Dayton area and the heavily reported issues with the VA were also drivers behind the decision to start the new line of insurance work at CareSource.

“When you fit all those together, it’s an opportunity for CareSource to continue to live its mission and that’s the primary driver behind it,” Preitauer said.

The VA Mission Act builds on a 2014 measure to increase access to private sector care. The law eliminates the existing requirement that vets wait at least 30 days or travel more than 40 miles to qualify for a private health care appointment.

The changes allow for more of Dayton’s veteran population to access local specialists and dozens of veterans groups supported the bill.

MORE: New Dayton VA director wants to be transparent for veterans

Some critics of the legislation, however, warned that if billions of dollars are taken out of the VA system, it could lead to VA facilities shrinking or closing.

House Minority Leader Nancy Pelosi, D-Calif., also cautioned when the bill passed in June that the lack of new money for the legislation sets up “another VA crisis and billions in budget cuts to critical veteran initiatives down the road.”

At the time that the new law was signed, nearly a third of veterans appointments were already with private sector providers.

Associated Press contributed to this report.

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