The Department of Veterans Affairs (VA) continues to clean house, announcing Monday afternoon the termination of 585 contracts it said will help redirect more than $900 million to healthcare, benefits and services for veterans.
The VA said its cuts are the “first step” in an audit of the roughly 90,000 contracts it currently has in place—a process its announcement stressed is being conducted with in-house expertise and feedback.
Those eliminated were among almost 2,000 professional services contracts reviewed so far and represent “non-mission-critical or duplicative” roles. Affected contracts included staff mentoring, leadership coaching, executive support and other administrative services “that VA can perform on its own,” the department said.
Conversely, contracts that directly supported veterans and beneficiaries or provide services the department “cannot do itself, such as a nurse who sees patients” were spared, the VA said.
“The termination of these contracts will not negatively affect Veteran care, benefits or services, and will help VA better focus on its core mission: providing the best possible care and services to Veterans, their families, caregivers and survivors,” the VA said in its announcement.
The canceled contracts total $1.8 billion in value, though about half of that money has already been spent. The department said the remainder will go toward care and other services for veterans, plans for which it said will be shared “in the coming weeks and months.”
“Under President Trump, VA is focused on becoming more efficient, responsive and accountable to the Veterans, family members, caregivers and survivors we are charged with serving,” VA Secretary Doug Collins said in the announcement. “We are putting Veterans first at VA. That means finding new and better ways to do our jobs and focus our resources. Every dollar we spend on wasteful or duplicative contracts is one less dollar we can spend on Veterans, and given that choice, I will always side with the Veteran.”
The department said its “deliberative, multi-level review” is leaning on “career subject-matter expert employees responsible for the contracts as well as VA senior leaders and contracting officials.” These employees “were given the option to stop a cancellation if they felt it would negatively impact health care, benefits or services for Veterans or VA beneficiaries,” the department said.
While the subject-matter experts were spotlighted in the release, Monday’s announcement made no mention of any input from the Department of Government Efficiency (DOGE), the controversial Elon Musk-led initiative that is scouring agencies across the government for spending it deems to be wasteful. Just last week, President Donald Trump signed an executive order giving the DOGE more leeway to cut federal contracts and grants.
The VA’s contract eliminations come in the wake of two workforce dismissals at the department, the first affecting more than 1,000 workers and the second more than 1,400. Together, the department said those cuts would save over $180 million per year that, as with the contracts, will be redirected toward veteran care.
These were probationary employees deemed to hold “non-mission critical positions,” though reports have circulated that some fired employees were being reinstated. Despite assurances from the VA, the department’s workers have told media that some of these cuts have jeopardized essential functions such as the Veterans Crisis Line.
More recently, a leaked memo outlined plans to cut over 80,000 workers from the department as part of an "aggressive" reorganization.