Why does the United States Veterans Administration have its own health care facilities and provide its own healthcare?

The VA was started in 1930, and in 1944 additional responsibilities were added by the GI Bill of Rights. And over the years, the demand on the system has been balloone3d by maintaining a military which was  involved in several major wars, and medical technology which has grown quite sophisticated.  In addition to this, VA has a huge budget administering all of these benefits for our retired and wounded warriors. And as in all bureaucracies which operate without practical limit on their expenditures (just vote them more money), the infrastructure grew like crazy. I believe it would be difficult to argue  that these VA hospitals give better care than those in the general population.  And I also believe that doctors in the private sector are of better quality and higher paid.  Why would an excellent doctor willingly go to work for the government when he can likely make twice as much out in a group or even on his own? As for effectiveness, I ask, 'compared to what?' Name a government service provider that is more effective than its counterpart in the private sector.  The post office?  Energy Department?  Treasury? The VA has some use, but I suspect it is NOT in running hospitals! You could eliminate much of the VA bureaucracy simply by providing vouchers to vets who need care, and letting the hospitals which specialize in this stuff do what they do best. In answer to your sub-question, NO! We do not want a government run organization competing with the private sector.  However, I would encourage the VA to sell their hospitals at fair prices to health companies in the private sector, and let competition among those then-private entities force improvement of services and the benefits of professional management and the economies of scale.

The theory is that having specific hospitals for veterans will cut down on wait times because they aren't competing for space. Also, it is cheaper because there is less administration needed to run them. For those who are interested in was socialized health care would look like in the US, look at Va.