Funding Threatens VA Care

July 24, 2015

In a contentious hearing, lawmakers accused VA Secretary Bob McDonald of covering up information threatening the health care of millions of veterans.  

McDonald said the department faces a $3 billion budget shortfall and, without congressional action, will have to deny access to health care to veterans.  

“We'll have no option at the end of July but to defer … authorizations until October, provide staff furlough notices, notify vendors we cannot pay them as we begin an orderly shutdown of hospitals and clinics all across the country,” said McDonald.  

According to McDonald, the VA is struggling to meet the increased demand for health care provided under the Choice Act. The Choice Act allows some veterans to receive health care at non-VA facilities, paid for by the VA.  

Passing of the Choice Act has driven up costs for delivering care outside the VA. The Choice Act, along with other community care programs, all have different authorities and budget lines. Currently, VA lacks the authority to move dollars between the programs.  

That means that even though Congress has increased overall funding for VA health care, the money has only gone to specific accounts.  

“You already appropriated funds to meet these needs, but you haven't given me the flexibility and authority to use them,” said McDonald.  

A victim of its own success, VA has been able to double its capacity in staffing, space, productivity, and delivering care over the past year. This hard work resulted in 7 million more appointments for veterans, 4.5 million of them from outside providers. But the VA estimates that for every one percent increase in veterans accessing health care, it spends $1.5 billion on health care delivery.  

The revelation did not sit well with members of Congress.  

House Veterans Affairs Committee Chairman Jeff Miller (R-Fla.) chided McDonald for his “slow, painstaking revelation of the crisis” and the department's financial woes, problems the VA first became aware of in April but failed to inform Congress of until early June.  

The fix?  

The short-term solution is for Congress to give VA the budget flexibility to address the shortfalls to ensure continued care for veterans.  

The long-term solution to VA's budget problems is to consolidate and streamline all of the VA community care programs. Congress and the VA are working to simplify management of health care services.  

MOAA joined with a number of other veterans' organizations in writing asking committee leaders to resolve the VA's budget crisis.  

The Senate expects to take up the issue next week.