> As long as total spending is unchanged there is no reason to suspect economic harm.
You mean other than the vast dislocation that health industry labor - and two dozen other industries reliant on that spending - would suffer? People taking pay cuts in healthcare, workers losing jobs in pharma & health insurance by the hundreds of thousands (high paying jobs at that). Your premise would only actually work that way in a simulation (and it'd be a really bad simulation, not accounting for anything in the real world), not in reality. In reality, there is dramatic economic friction that occurs when you fire someone and they have to retrain / find a new job, or when you cut their pay to bring costs in line. There are immense short-term and long-term costs to that upheaval, in reality. Such costs include: unemployment costs, job training, long-term unemployment costs, welfare benefit costs, tax base loss until jobs & incomes are recovered. The US economy is growing very slow, where's the evidence it can absorb such losses and then create a million new high paying jobs (simultaneously while automation is about to bear down on just about every category of employment)?
If the VA spent 1/2 as much money and covered 1/6 of the costs while provoviding the same benefit that would be a good thing. This analysis ignores survives provided because the only way to make them look bad is to pretend spending more money is somehow a good thing.
Further the UA is often covering the most expensive care such as hip replacements, the fact that it's a lower percentage of costs is a result of efficiency of the VA and waste in the rest of the system.
As to lowering costs, economically spending money on heathcare billing vs Rail is only different because Rail provides long term value. As long as total spending is unchanged there is no reason to suspect economic harm.