With the continuous growth of VA beneficiaries, these have been a recent warning to Congress over the PACT Act and budget deficit. Learn about the details and the impacts on VA payments.
Veteran Affairs Reports Major Funding Deficits
In recent times, there has been warming from the Department of Veteran Affairs (VA) to Congress about a significant decline in the budget, which is estimated to be about $15 billion between now and the next fiscal year.
Reports from the House Veteran Affairs Committee Chairman Mike Bost (R-III) state that some top officials from the Veteran Health Administration (VHA), as well as the Veteran Benefits Administration (VBA), announced a budget deficit of about $2.88 billion for the current fiscal year; furthermore, the budget also states a $12 billion shortfall, which has been anticipated for the 2025 fiscal year.
This budget gap is represented as one of the largest in veteran affairs history. This has ignited considerations about the longevity of veteran Carr and its benefits, especially under the 2022 PACT Act, which has expanded healthcare and benefits for veterans who have been exposed to toxic substances.
Increased costs drive deficits
Several factors have been attributed to the VA budget discrepancy, and this includes hiring and rising pharmaceutical costs. Despite the initial plan to reduce the workforce by 10,000 employees, VHA is looking to increase its staff by 22,000 full-time employees over the same period.
This adjustment also reflects a shift in the approach Veteran Affairs is using to manage its workforce, especially after hiring more than 61,000 employees last year. It is also recorded as the fastest-growing rate in 15 years.
Veteran Affairs Press Secretary Terrence Hayes has confirmed the projected budget deficit; it also noted that the VA is delivering record levels of healthcare and benefits to veterans that are under the PACT Acts. Over 710,000 veterans have enrolled in VA healthcare since the Act’s implementation, marking a 34% increase compared to that same period before the legislation. The VBA is also expected to set a new record for the volume of disability benefits claims processed this year.
Congressional Criticism and Strategic Concerns
Chairman Boat has criticized Veteran Affairs on its budget handling; he also described the $15 billion shortfall as a “repudiation” of the Biden administration’s FY 2025 budget request. Boat accused the department of fiscal mismanagement and “strategic whiplash.” He also points out the abandonment of previously established budget estimates and projections.
The chairman also raised concerns about the VA’s reliance on the Toxic Exposures Fund, which was created under the PACT Act, to cover regular expenses. He also argued that this approach, which is coupled with the expiration of pandemic-related supplemental funding, has made the Veteran Affairs budget complex and vulnerable to unexpected events.
Impact on veteran and future outlook
The decline in budget has prompted questions about the potential impact on veterans’s care and benefits. However, the VA also assured lawmakers that it is working hand in hand with Congress as well as the Office of Management and Budget to rectify this decline without hurting veterans.
Furthermore, the uncertainty surrounding the VA’s financial situation has led to frustration among job applicants, and some are experiencing delays in the process of hiring.
Boat has also called for transparency amongst the VA, especially in regards to the need for increased staffing amid a policy of hinging restrictions as well as managing by attrition. Boat has also questioned the need to hire over 22,000 new staff nationwide.
