Plans for multiple VA medical clinics remain stalled despite funding

Getting 15 new Department of Veterans Affairs medical locations up and running remained sidelined more than two years after their approval because of ongoing bureaucratic wrangling over pricing methodology for location leases, leaving those tracking the issue fearful that veterans will get fewer health care options than promised.

Veterans Affairs leaders and congressional officials in recent years have pointed to the proposed medical lease sites as a valuable tool in expanding care options for veterans.

But the roughly $670 million set aside by lawmakers for those 15 projects was not enough to pay for the planned spaces, according to preliminary bids. And since getting that news, officials for months have been unable to move ahead on the process for getting new bids on the projects, largely due to behind-the-scenes concerns over pricing guidelines.

The stalled projects are located in 12 different states, including two in Texas and three in Florida. Fourteen are potential new outpatient clinics, while one in Tampa, Fla., is a planned community living center.

As part of the PACT Act — sweeping veterans benefits legislation signed into law in August 2022 — Congress authorized and funded 31 new major VA leases, designed to expand medical and support service options for veterans across the country. In all, the projects were expected to provide 2.8 million square feet of additional health care space and serve more than 3.6 million veterans in coming years.

At the time of the legislation’s passage, VA officials touted the authorizations as a win for veterans, allowing planners to move faster in creating new medical spaces than the traditional construction and facility acquisition process.

Since June 2023, one lease has been awarded and 15 more are in the final steps of being approved, according to department officials.

VA press secretary Terrence Hayes acknowledged that “for the remaining 15 leases, VA has received offers that exceeded authorized funding levels, which VA cannot accept under law.”

That means officials will have to rework and resubmit those proposals to lawmakers with new parameters and cost guidelines before moving ahead. Congressional committees will have to grant final approval on any substantial changes before they can proceed.

Hayes said the money set aside for the work does not expire, so the delays do not endanger funding for the projects.

But individuals familiar with the process told Military Times that VA and Office of Management and Budget officials have been sparring since early spring over methodology for calculating rates and cost adjustments, a bureaucratic fight that has set back the project.

OMB officials did not return requests for comment on the matter. VA officials would not comment on correspondence with OMB leaders.

The technical fight has repeatedly pushed back opportunities to move ahead with the search for new locations for the clinics, even as VA officials have emphasized the need for more medical options for veterans. Congressional staff said they expected the new leases to be submitted for approval months ago, and are unsure exactly where VA and the White House stand in the current process.

If the new leases aren’t approved by the end of the year, the process could be forced to start over completely under a new administration and Congress, pending the results of the November elections.

That could mean months more waiting for the leases to be approved and even longer for facility staff opening doors to provide care to veterans. As it stands, even if the projects do move ahead in the next few weeks, it’s unlikely that doors for the new clinics will open before mid-2025.

Hayes said department leaders remain “fully committed to providing timely access to world-class care at these sites, and we are exploring all possible options, including working with Congress, to move forward on these leases.”

VA officials have not released completion dates for any of the PACT Act lease projects, or when they expect to resubmit paperwork to Congress on the problematic ones.