Members of the Senate Committee on Veterans’ Affairs are calling on the Department of Veterans Affairs (VA) to provide more transparency on its budget needs just as Congress bailed the agency out on Thursday with billions of dollars in supplemental funding for fiscal year (FY) 2024.
The VA is requested an additional $2.88 billion in FY2024 funding for mandatory benefits payments – something it attributes to a record-setting number of benefits delivered to veterans as a result of the PACT Act.
The PACT Act is a recent law that expands VA health care and benefits for veterans exposed to burn pits, Agent Orange, and other toxic substances. Despite studying projections at the beginning of the year, the VA said the number of veterans who applied for benefits under the PACT Act “exceeded our expectations.”
“This is money that goes straight into the pockets of veterans and their survivors,” Joshua Jacobs, the under secretary for benefits at the VA, told the committee during a Wednesday afternoon hearing.
“Any funding shortfall of even $1 would prevent VA from processing its September pay file, and as a result, delay benefit payments to approximately 7 million veterans and survivors,” Jacobs said.
The good news is that the House passed an emergency bill on Tuesday evening to address the roughly $3 billion budget shortfall at the VA and continue to provide benefits to veterans. The Senate just passed the legislation into law on Thursday, ensuring veterans’ benefits payments continue.
“We knew addressing long-ignored issues like toxic exposure is going to cost a few bucks, but it is the right thing to do,” Committee Chairman Jon Tester, D-Mont., said.
Jacobs said that the VA informed the committee of this funding shortfall about a month after it discovered the issue – once it “validated” the need for the additional $2.88 billion. However, lawmakers voiced their concern that the VA should have notified them of the potential funding issue earlier.
“What is really troublesome to me is the lateness in which this issue arose,” Ranking Member Jerry Moran, R-Kan., said, noting that the issue was not brought up when the VA testified before Congress months earlier on its budget needs for FY2025.
“My complaint today is really with the level of trust and respect that I would hope we have from the Department of Veterans Affairs,” Sen. Moran said. “Why wouldn’t you call and inform us about the problems that are arising so that we can make the decisions at the appropriate time and avoid this?”
Jacobs agreed that the VA should have notified the committee sooner, and he pledged to be more transparent with Congress as well as veterans and their families on this issue.
“We had to work to verify that our projections were sound,” Jacobs said. “Looking back, I should have picked up the phone and said, ‘Hey, we’re working through this and wanted to give you a heads up.’ So, that’s one of my lessons that I’m going to take from this and promise to do better.”
Looking Ahead to FY2025
The VA is also facing budget shortfalls as it looks ahead to FY2025. The agency informed Congress in July that the Veterans Health Administration (VHA) is facing a $12 billion shortfall in fiscal year (FY) 2025 for medical care.
VA said it is requesting this additional $12 billion due to the growth in services to veterans, as well as other factors such as rising costs for pharmaceuticals and prosthetics.
“Without these resources, VA will be forced to make difficult cuts, most notably to outreach, care coordination, and more,” VA Under Secretary for Health Shereef Elnahal told the committee. “This funding is necessary to continue to deliver more care to veterans than ever before, and maintain our achievements in quality, access, and all-time high veteran trust.”
With the VA facing $3 billion and $12 billion funding shortfalls, Sen. Mazie Hirono, D-Hawaii, asked the VA whether or not it has the tools it needs “to accurately project your funding needs.”
In response, Jacobs said that from a VBA perspective, “I believe we do have the tools.”
He noted that at the beginning of this fiscal year, the VA projected it would deliver 2.2 million claims decisions. However, Jacobs said it has already surpassed 2.4 million, and the agency is on track to complete 2.5 million claims decisions.
“I think one of the key lessons learned is that we should not underestimate our workforce. They over-delivered on what we thought were already aggressive projections,” he said. “So, we’re increasing the total number of veterans we anticipate being able to serve.”
“One of the things I want to impart on this organization is to take the right lessons from this experience,” Jacobs added. “We could have slowed down claims processing or stopped claims processing to meet those targets, but we chose not to because we wanted to keep our foot on the gas … delivering as many benefits to as many veterans as possible.”
