VA finds $1 billion healthcare budget hole

Share this content:

The Department of Veterans Affairs is grappling with an unanticipated $1 billion shortfall for veterans' healthcare in its current budget.

VA officials last week explained to Congress that the shortfall was a result of using an inaccurate, two-year-old financial model to calculate spending requests. The model underestimated the impact the Afghanistan and Iraq wars and made other mistakes. The current year's forecasts were made before the 2003 war with Iraq began. Spending growth rose 5% instead of the projected 2.5% this year.

While the House already has approved its fiscal year 2006 appropriations for the VA, the Senate still can address the shortfall. VA healthcare programs received $28.2 billion in FY 2005. President Bush requested a similar amount for FY 2006. A Senate hearing likely will be held this week on the issue.