The U.S. Department of Veterans Affairs (VA) provides invaluable services, such as medical care, and benefits, such as disability compensation, to U.S. veterans. The authors of this report present an overview of VA’s budget, its funding sources, and its relevant flexible authorities. They describe VA’s budget process and some of the pressing VA-related issues that policymakers face.

Demystifying the Department of Veterans Affairs Budget Process

An Explainer

Ryan Consaul, Reika Sophia Herman, Heather M. Salazar

ResearchPublished Apr 28, 2025

The United States has provided care for its veterans since the nation’s inception through various means, such as health care and financial support. The U.S. Department of Veterans Affairs (VA) operates a vast health care network and provides benefits to millions of veterans, their survivors, and, in certain circumstances, dependents. In this report, the authors present an overview of VA’s budget, its funding sources, and flexible authorities. The authors also describe VA’s budget process and some of the pressing relevant issues that policymakers face. This report is intended to be primer for new congressional staffers, policymakers, and others who are interested in understanding VA’s budget. The authors drew from prior RAND work conducted for the Commission on Planning, Programming, Budgeting, and Execution Reform, VA case studies, and an examination of VA’s three most recent budget requests.

Key Findings

  • The VA budget is split between discretionary (i.e., medical services and the Veterans Health Administration) and mandatory (i.e., disability compensation and the Veterans Benefits Administration) spending.
  • Over the past 14 years, VA’s annual budget authority has tripled in size to $307.31 billion in fiscal year 2024, 57 percent of which is in mandatory spending and 43 percent is in discretionary spending.
  • A substantial driver of the mandatory spending increase is due to the expansion of presumptive service conditions, such as chronic rhinitis and sinusitis, multiple types of cancers, and other illnesses, which may provide a veteran with a monthly disability payment.
  • The budget’s discretionary spending increases are mostly due to the expansion of eligibility and enrollment in the VA health care system under the PACT Act. The PACT Act established the Cost of War Toxic Exposures Fund as an appropriated entitlement to cover the cost of health care and benefits for veterans whose health conditions are presumptively associated with exposure to burn pits, Agent Orange, and other environmental hazards.

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Document Details

  • Copyright: RAND Corporation
  • Availability: Available
  • Year: 2025
  • Print Format: Paperback
  • Paperback Pages: 38
  • Paperback Price: $16.50
  • Paperback ISBN/EAN: 1-9774-1493-1
  • DOI: https://doi.org/10.7249/RRA1363-11
  • Document Number: RR-A1363-11

Citation

RAND Style Manual

Consaul, Ryan, Reika Sophia Herman, and Heather M. Salazar, Demystifying the Department of Veterans Affairs Budget Process: An Explainer, RAND Corporation, RR-A1363-11, 2025. As of April 30, 2025: https://www.rand.org/pubs/research_reports/RRA1363-11.html

Chicago Manual of Style

Consaul, Ryan, Reika Sophia Herman, and Heather M. Salazar, Demystifying the Department of Veterans Affairs Budget Process: An Explainer. Santa Monica, CA: RAND Corporation, 2025. https://www.rand.org/pubs/research_reports/RRA1363-11.html. Also available in print form.
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Funding for this publication was made possible by a generous gift from Daniel J. Epstein through the Epstein Family Foundation. This research was conducted within the RAND Epstein Family Veterans Policy Research Institute within RAND Education and Labor.

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