VA says it faces $2.5B budget shortfall

WASHINGTON (AP) — The Department of Veterans Affairs said Thursday it faces a budget shortfall of more than $2.5 billion, mainly because of increased demand by veterans for health care, including new life-saving treatments for Hepatitis C.

Deputy VA Secretary Sloan Gibson told a House committee that VA health care sites experienced a 10.5 percent increase in workload for the 12-month period that ended in April.

The VA needs flexibility from Congress to close the budget gap and pay for what he called “an untenable situation” in which demand by millions of veterans for health care far exceeds resources available, Gibson said.

Gibson said VA is considering furloughs, hiring freezes and other significant moves to reduce the budget gap.

Gibson also said the VA wants to use money from the new Veterans Choice program to pay for the increased health care. The program, the centerpiece of a VA overhaul approved last year, makes it easier for veterans to receive federally paid medical care from local doctors. Congress approved $10 billion over three years for the Choice program as it responded to a scandal over long waits for veterans seeking medical care and falsified records to cover up the delays.

While the program got off to a rocky start, veterans’ use of the program has expanded dramatically in recent months is likely to grow even more in coming months, Gibson said. The VA also has expanded its staff, office space and productivity in the wake of the scandal, which broke out last spring at the Phoenix VA hospital and spread to health sites nationwide, Gibson said.

The VA completed 7 million more appointments for care in the past year, compared to the previous year, Gibson said, but said veterans still face increased wait times in Phoenix, Las Vegas and other sites

“Clearly, we are providing more veterans more access to care,” Gibson told the House Veterans Affairs Committee, but added: “As we improve access, even more veterans are coming to VA for their care.”

As a result, wait times for appointments longer than 30 days are up 50 percent from a year ago, Gibson said.

Wait times are up in Phoenix, even after the VA added 337 staff members, increased the number of appointments by 109,000 and authorizations for outside care by 91 percent.

The reason: In the same time period, the number of veterans in Phoenix receiving primary care increased by 11%, Gibson said. Those receiving specialty care went up by 17 percent, and mental health appointments increased by 16 percent, he said.

“This unprecedented increase in veteran access to care has come at a cost,” Gibson said. The Veterans Health Administration, the VA’s health care arm, now expects to spend $10.1 billion in the current budget year for private care, an increase of $1.9 billion from last year.

Rep. Jeff Miller, R-Fla., chairman of the veterans affairs panel, said he was shocked that VA officials waited until nearly nine months into the budget year to announce such a large budget gap.

“I have come to expect a startling lack of transparency and accountability from VA over the last years,” Miller said, “but failing to inform Congress of a multibillion-dollar funding deficit until this late in the fiscal year … is disturbing on an entirely different level.’

Miller and other lawmakers faulted the VA for what they called a continued emphasis on a failed and bloated construction project for a VA hospital in Denver that is more than $1 billion over budget.

Instead of focusing on “a construction project that benefits no veteran for at least two more years” the VA should have been devising ways to pay for the sharp increase in demand for health care, Miller said.

“It proves to me once again that VA’s current problems reflect a management issue far more than they represent a money issue,” Miller said.


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