(WASHINGTON) — One day after the Department of Veterans Affairs celebrated an estimated $2 billion in savings on canceled contracts, the agency began reversing some of the cancellations that may have affected veterans’ medical care and other benefits, according to multiple sources familiar with the contracts and agency records reviewed by ABC News.
“We were taking in millions of dollars in contracts to create things like PowerPoint slides and meeting minutes,” VA Secretary Doug Collins said on Tuesday. “Millions of dollars in contracts for ‘coaching and training.'”
“Don’t feed the line of what D.C. is wanting to sell you,” he added. “We are putting money back to veterans’ health, back to veterans’ benefits. And don’t let nameless sources, even senators and House members, who want to scare you, and the media, who want to perpetuate the line. We’re taking care of veterans.”
But the hundreds of contracts set for cancellation included some for legally required technical inspections of medical equipment that produce radiation at VA facilities, including CT scanners, MRI machines and dental X-ray units.
Without annual inspections, some of which are conducted by contractors in part to save the agency money, VA staffers are not permitted to use the equipment.
“We’re a really good deal for them,” said one contractor with multiple agency contracts, including several that were initially canceled — and then reversed by Wednesday afternoon. “They can’t afford to have that done in-house.”
Canceling the contracts “100% will impact care,” a VA official told ABC News. “If [the machines] get serviced or a part is replaced, they need to be inspected as well.”
Asked for comment Tuesday, a VA spokesperson told ABC News, “We’re reviewing VA’s various contracts, and we will be canceling many focusing on non-mission critical things like PowerPoint slides, executive support and coaching. Our review is ongoing and not final.”
“We will not be eliminating any benefits or services to veterans or VA beneficiaries, and there will be no negative impact to VA healthcare, benefits or beneficiaries,” the spokesperson added. “We are always going to take care of veterans at VA. Period.”
Some of the contracts marked for termination on Monday included contracts to provide employee and workplace benefits services to tens of thousands of VA employees and their families. Others included work overseeing hazardous waste disposal, conducting safety inspections at VA medical facilities, supporting cancer programs and burial services, according to agency records review by ABC News.
Some of the contracts marked for termination on Monday included contracts to provide employee and workplace benefits services to tens of thousands of VA employees and their families. Others included work overseeing hazardous waste disposal and conducting safety inspections at VA medical facilities.
Many of these contracts are labeled as some variations of consulting, a sweeping category of federal contracts that the Department of Government Efficiency’s team has aggressively gone after as part of its efforts to cut wasteful government spending.
“Everyone can agree that there is waste, likely fat, and there may very well be some fraud,” Arthur Mabbett, a disabled veteran and CEO of Mabbett & Associates, a government contractor with dozens of contracts with the VA and other agencies, told ABC News.
“Doing it in a businesslike fashion, rather than pure chaos, which is what they’re doing right now, would be a better approach,” said Mabbett, whose company has not had its stop-work orders rescinded as of Wednesday evening.
Some of that work includes working with VA facilities to make sure expansion and renovation projects comply with federal environmental law.
Sen. Richard Blumenthal, D-Conn., on Tuesday slammed Collins’ previous move to cancel the contracts, saying many of those contracts provide “critical and direct services” to veterans.
“To say abruptly cancelling these services won’t impact veterans’ care and benefits is another unrealistic promise from Collins,” Blumenthal wrote in a statement. “Make no mistake — this is just another reckless cost-cutting decision that will harm veterans and taxpayers for years to come.”
Agency leaders directed employees to begin terminating hundreds of contracts on Monday, with some stop-work orders issued that evening.
Already, some of those stop-work orders have been rescinded — one of several DOGE-led efforts across the federal government that have been slowed or partially reversed by various agency leaders.
“I like what they’re doing, I just think they made a mistake, and they need to fix it,” one contractor told ABC News about the overall DOGE efforts. “If it goes quickly, I’ll be happy. And if it takes three to four months, I won’t be.”
The VA has already gone through two rounds of layoffs: The first affected 1,000 workers, and the second, announced this week, affected 1,400 “non-mission critical positions,” according to the agency’s statement.
Some of those terminated employees were asked to return to work days later, workers told ABC News.
Other layoffs may be on the horizon. On Wednesday, the Trump administration directed agencies to begin preparing for “large-scale” layoffs and reorganizations and to present plans for doing so to the Office of Management and Budget by March 13, according to a memo obtained by ABC News.
-ABC News’ Soorin Kim and Nathan Luna contributed to this report.
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