Department of Veterans Affairs Procurement Updates

The Department of Veterans Affairs (VA) is under federal court order to fully implement a reinstated collective bargaining agreement with the American Federation of Government Employees National VA Council (AFGE NVAC) covering approximately 320,000 VA employees. Despite the court injunction issued in 2025, the VA has not fully complied with the contract provisions, leading to ongoing legal disputes and union demands for enforcement. The VA cites conflicting interpretations of a 2025 executive order that limits collective bargaining rights for certain federal agencies, complicating compliance efforts. This situation underscores significant procurement and labor relations challenges within the VA, affecting contract administration, workforce management, and vendor engagement related to labor services and employee benefits.

• Why this matters: Procurement professionals should anticipate potential impacts on VA labor-related contracts and service agreements due to ongoing legal and compliance uncertainties.
• The reinstatement and enforcement of the union contract may influence VA workforce stability, affecting contract performance and vendor coordination.
• Contractors providing labor relations, human resources, or employee benefit services to the VA should evaluate contract terms in light of evolving legal requirements and court rulings.
• Organizations engaged with the VA must monitor developments to ensure alignment with federal labor policies and judicial mandates affecting procurement and contract execution.

On March 26, 2026, the House Veterans' Affairs Subcommittee on Oversight and Investigations held a legislative hearing focused on a suite of 12 bills aimed at enhancing financial management, contracting transparency, and data privacy within the Department of Veterans Affairs (VA). Key procurement-related discussions included the VA Fiscal Management Modernization Act to strengthen budget oversight and clarify CFO authority, and the Veteran Data Accountability for Third-party Actors Act (H.R. 7280), which mandates contract clauses prohibiting the sale or misuse of veterans' data by contractors, including for AI training or scams. The Subcommittee also reviewed legislation addressing software asset management to reduce wasteful spending on licenses and improve contractor data privacy practices. VA officials acknowledged existing policies but recognized the need for improved oversight and transparency. Witnesses from veterans' organizations emphasized protecting veterans' data and ensuring contracting opportunities for veteran-owned small businesses. These legislative efforts signal increased scrutiny on VA procurement processes, data security requirements, and financial accountability measures.

• Why this matters: Procurement professionals should anticipate new contract clauses restricting data monetization and enhanced requirements for data privacy compliance in VA contracts.
• The focus on software asset management indicates potential opportunities for vendors offering license optimization and IT asset management solutions.
• Veteran-owned small businesses may see expanded subcontracting opportunities as legislation promotes contracting transparency and workforce protections.
• Organizations supporting VA procurement should prepare for evolving financial oversight standards impacting budget management and contract administration.

Congress has introduced the bipartisan, bicameral Get Justice-Involved Veterans BACK HOME Act to establish a pilot program enabling the Department of Veterans' Affairs (VA) to provide targeted mental health services to incarcerated veterans. The legislation prioritizes veterans with service-connected disabilities such as PTSD, traumatic brain injury (TBI), and military sexual trauma (MST), and encourages the creation of veteran-specific housing units within correctional facilities to support rehabilitation and reintegration. This initiative represents a significant expansion of VA healthcare access into correctional settings, aiming to improve outcomes for justice-involved veterans and reduce recidivism.

• Why this matters: Procurement professionals should anticipate new VA contracting opportunities related to mental health service delivery within correctional facilities, including clinical staffing, program management, and specialized housing support.
• The pilot program may require partnerships with correctional agencies and veteran service organizations, creating demand for integrated healthcare and social support services.
• Contractors with expertise in veteran mental health, trauma-informed care, and correctional healthcare environments should evaluate capabilities to meet emerging VA requirements.
• This legislation signals increased federal investment in justice-involved veteran care, potentially influencing future VA procurement strategies and funding allocations.

The Department of Veterans Affairs has awarded CALIBRE Systems a follow-on contract valued at approximately $79.8 million to continue providing support for the Transition Assistance Program (TAP). This contract extends CALIBRE's role in delivering human capital and training services that assist service members and veterans in transitioning to civilian life, building on over five years of prior performance and a previous contract valued at $135 million awarded in December 2020.

• Why this matters: The continuation of this contract signals VA's sustained commitment to enhancing veteran transition services and reflects confidence in CALIBRE's delivery capabilities.
• Procurement professionals should note the significant contract value and the opportunity for vendors specializing in workforce development and training services within the veteran support space.
• Contractors can leverage this information to align offerings with VA's human capital and transition assistance priorities, potentially positioning for future solicitations.
• This award underscores the importance of long-term performance and relationship-building in securing follow-on contracts within federal veteran services programs.

The U.S. House of Representatives, led by Rep. Nikki Budzinski, has introduced legislation imposing measurable performance benchmarks and an exit option on the Department of Veterans Affairs' Electronic Health Record Modernization (EHRM) program, currently contracted with Oracle Cerner. This $37 billion contract faces congressional scrutiny due to delays, patient safety concerns, and limited deployment progress since its inception nearly eight years ago. The VA plans to relaunch the EHRM program in April 2026, expanding to 13 new sites with a focus on system stability and interoperability. The legislation mandates independent verification of improvements and allows contract termination if benchmarks are unmet within two years, signaling potential shifts in federal health IT procurement and vendor accountability.

• Key agencies involved: Department of Veterans Affairs (VA), Veterans Health Administration (VHA), and the U.S. House Committee on Veterans’ Affairs
• Contract details: $37 billion EHRM contract with Oracle Cerner, with congressional pressure to demonstrate measurable progress or risk termination
• Procurement implications: Vendors should anticipate increased performance oversight and potential contract restructuring; procurement professionals must prepare for possible recompetition or alternative sourcing strategies
• Actionable insight: Organizations supporting VA health IT modernization should align with updated performance metrics and governance requirements ahead of the April 2026 relaunch to remain competitive and compliant

The Department of Veterans Affairs (VA) has indicted John Windom, former Executive Director of the Office of Electronic Health Record Modernization, for concealing over $16,000 in gifts and cash from government contractors involved in the VA's multibillion-dollar Electronic Health Record (EHR) modernization program. This high-profile $10 billion Cerner Oracle contract, awarded in 2017, has faced significant delays, operational challenges, and patient safety concerns, notably after its 2020 Spokane launch. The indictment underscores ongoing scrutiny of conflicts of interest and oversight failures within one of the federal government's largest IT modernization efforts.

• Why this matters: Procurement professionals should be aware of increased regulatory and oversight risks in large-scale federal IT contracts, especially those involving health records modernization.
• The case highlights the importance of ethical compliance and transparency in contractor relationships to avoid legal and reputational risks.
• Contractors and vendors involved in VA IT modernization programs may face heightened scrutiny and should ensure strict adherence to gift and conflict-of-interest policies.
• Agencies and industry stakeholders should anticipate potential impacts on contract management and oversight practices as the VA strengthens accountability measures.

The Department of Veterans Affairs (VA) has been ordered by a federal court to reinstate its collective bargaining agreement (CBA) with the American Federation of Government Employees (AFGE). However, the VA maintains that reinstatement does not require immediate compliance with the contract's terms, insisting that grievances must be filed individually for alleged breaches. Concurrently, the VA has refused to participate in grievance proceedings, resulting in ongoing enforcement disputes and legal uncertainty regarding contract implementation.

• Why this matters: Procurement and labor relations professionals within federal agencies should be aware that court-ordered contract reinstatements may not guarantee straightforward enforcement, potentially complicating labor management and contract administration.
• The VA's stance on grievance procedures indicates possible delays or challenges in resolving contract disputes, which could affect workforce stability and operational continuity.
• Contractors and vendors working with the VA or similar agencies should consider the implications of labor disputes on contract performance and risk management.
• Legal and procurement teams may need to prepare for extended negotiations or litigation related to contract enforcement and labor relations compliance.

Senators Chuck Schumer and Kirsten Gillibrand have formally requested the Department of Veterans Affairs (VA) to suspend its plan to close the Schenectady VA Clinic in New York, which serves over 1,500 veterans in the Capital Region. They have set a deadline of April 10, 2026, for the VA to provide detailed assurances that veterans will continue to receive uninterrupted, high-quality healthcare services. This development signals potential delays or reconsiderations in VA facility consolidation efforts in the region.

• Procurement professionals should anticipate possible shifts or pauses in VA healthcare facility contracts and service agreements related to the Schenectady clinic closure.
• Contractors providing medical services or facility management in the Capital Region may face changes in contract scopes or extensions depending on VA decisions.
• This situation underscores the importance of stakeholder engagement and congressional oversight in VA procurement and facility management decisions.
• Organizations supporting veteran healthcare delivery should prepare for potential continuity of care requirements and possible expansions at alternative VA clinics in Albany, Clifton Park, or nearby locations.

Congressional representatives have introduced and advanced two bipartisan bills aimed at strengthening support for Department of Veterans Affairs (VA) employees and enhancing funding for veteran healthcare services. The Supporting VA Families Act mandates unpaid parental leave for VA workers regardless of collective bargaining agreements, providing up to an additional month of unpaid leave to improve recruitment and retention. The Vets CLEAR Act directs funds recovered from False Claims Act cases into the VA Medical Care Collections Fund to bolster veteran healthcare funding. These legislative actions reflect a focused effort to improve workforce conditions and resource allocation within the VA system.

• Why this matters: Procurement professionals should anticipate potential impacts on VA staffing and service delivery contracts as workforce retention improves.
• The unpaid parental leave provision may influence VA human resources policies and contractor workforce planning.
• Consolidation of False Claims Act recoveries into healthcare funding could affect VA budget allocations and procurement priorities.
• Contractors supporting VA healthcare services may find increased funding stability and should align proposals accordingly.

The House Appropriations Committee conducted a Member Day hearing on March 17, 2026, to discuss the Military Construction, Veterans Affairs, and Related Agencies appropriations bill for fiscal year 2027. Key procurement priorities highlighted include full funding for the new Roseburg Veterans Home in Oregon, which will serve rural veterans with VA grants covering 65% of construction costs. The committee also addressed the urgent need to replace the commissary near Moffett Federal Airfield by 2029, following a lease extension, to continue supporting the large military community. Additionally, expanding the VA's operational footprint in Guam and the Pacific Islands through increased staffing in leased federal spaces and planning a new regional VA office was emphasized to improve veterans' access to benefits and services. Bipartisan support was expressed, with commitments to accommodate these funding and operational needs as the fiscal year 2027 appropriations process progresses.

• Why this matters: Procurement professionals should anticipate upcoming contract opportunities related to veterans' healthcare facility construction, commissary replacement projects, and federal leasing for VA operations in strategic locations.
• The emphasis on rural and Pacific Island veterans' services indicates targeted infrastructure investments requiring specialized construction and facility management expertise.
• Organizations involved in federal leasing and facility operations may find new opportunities supporting VA expansion in Guam and the Pacific region.
• Early engagement with the appropriations process and subcommittee priorities can inform strategic planning for contractors aiming to participate in these projects.