The Department of Veterans Affairs VA has revised its projected budget shortfall for fiscal 2025, lowering its previous estimate from $12 billion to $6.6 billion for veterans’ medical care.
This reduction follows adjustments in workforce cost estimates and an increase in VA’s direct care services, such as in VA medical centers and telehealth, which helped mitigate the need for community care services.
VA officials also highlighted that savings from underestimations in care spending and the department’s $3,000 per year savings per full-time employee played a role in reducing the shortfall.
VA Under Secretary for Health Dr. Shereef Elnahal indicated that the updated estimate includes a $2.5 billion carryover from 2024, ensuring the VA can meet the growing demand for services while investing in necessary upgrades.
However, the revision comes after criticism from lawmakers and advocacy groups over the VA’s initial budget inaccuracies, with concerns raised over delays in community care referrals and the VA’s ability to manage its budget forecasting process.
Elnahal acknowledged the discrepancies in the VA’s earlier budget projections, stating the department is undergoing an independent assessment of its budgeting procedures to improve accuracy moving forward.
He also emphasized the urgency of securing the revised funds by December 20 to prevent disruptions in service or staffing.
Despite the changes, some veterans’ groups continue to express concerns over potential restrictions on access to community care, although Elnahal reaffirmed that eligibility criteria for such care had not been altered.