The VA will pay less for health care in 2019 than it did in the first three months of 2018, and the agency has a much better financial picture than in the past.
But it’s still spending about twice as much per capita as it did during the first quarter of 2020, and that could leave the agency unable to pay its debts in the future.
As a result, the VA is on track to have about $4.7 trillion in unsecured debt and $2.5 trillion in assets in 2021, according to a report released Thursday by the nonprofit Institute for Policy Integrity.
The report comes as the VA has been spending more than $1 trillion a year to prop up its finances.
It is the latest report to paint a gloomy picture of the health care system.
Here are some of the biggest issues facing the agency: How much will it cost to cover its bills?
The VA has said it expects to save about $100 million per year on health care costs.
But the amount is likely to be lower because the VA will be able to spend less money on administrative costs.
A $100-million savings in 2020 would be less than half of the VA’s projected savings in 2021.
That’s because the department will be forced to lay off hundreds of employees and cut some of its benefits.
The VA says it has spent $1.1 trillion on administrative and other costs, and it has $3.9 trillion in unfunded liabilities.
That means it could be unable to cover those expenses in 2021 without raising additional taxes.
How much is too much?
If the VA had to raise taxes to cover the debt, it would take nearly $8 trillion.
That would be more than double the $4 trillion the VA says is needed to cover it.
How big will the debt be?
The total unfunding liabilities would amount to about $10 trillion, according the report.
That number includes about $6.2 trillion in medical care, pensions and other benefits that could be jeopardized by the VA cuts.
It also includes about 4.5 billion in future retirements and unfundments and $1 billion in health care reimbursements and reimbursements for care received in the United States.