The most obvious problem at the Veterans Affairs Department is that it doesn’t have a secretary. But that leadership vacuum only compounds the deeper issues the VA has spent years trying to overcome, Caitlin Owens reports.

The big picture: The VA is the second-largest federal agency, with a huge annual budget, and it’s also at the center of a heated political debate. But advocates generally agree about what its needs are:

• People: There are around 33,600 job openings at the VA — but that’s a lot better than the 49,300 employees the agency was seeking in May of last year.
• Mental health: Experts and advocates are generally happy with the work the VA has done to provide better mental health care to veterans who are already interacting with the VA. The next step is getting more veterans into the system.
• Electronic medical records: A final decision on the department’s long-delayed contract is expected “in the coming weeks," a VA spokesman said.
• A decision about private care: The Obama administration expanded access to non-VA care in the wake of the 2014 VA scandal. The next secretary will quickly be thrust into a fierce political debate about whether to further privatize veterans’ care.

Go deeper: Caitlin has more at Axios.com.

Late Friday, Medicare posted annual proposals outlining payments system for a slew of health care facilities. Bob Herman took a glance and had this breakdown of how much money certain groups will get next year.

• Nursing homes: $850 million. This would have been a $670 million pay bump under normal rules, but the latest spending bill from Congress mandated a higher rate for the nursing home industry. Medicare also proposed a new “patient-driven payment model” that could cut payments in the long term for things like therapy services.
• Hospices: $340 million. Actuaries anticipate Medicare’s spending on hospice services will increase 8% annually as more people age into Medicare and prefer to die outside of a hospital.
• Rehab hospitals: $75 million. Medicare floated the idea of allowing rehab doctors to perform more services remotely through video.
• Psychiatric hospitals: $50 million. A mostly flat rate that affects companies like Universal Health Services.

Keep in mind: These are proposals and will be heavily lobbied, so things could change by the time the rules are finalized in August.

Rep. Raul Labrador, who's running in the Republican primary for Idaho governor, says he might be willing to stop the state from expanding Medicaid even if voters approve the expansion in a ballot initiative this fall.

The details, as reported by the Idaho Spokesman-Review:

• Advocates say they are within 1,000 votes of the total needed to get Medicaid expansion on the ballot in November.
• Ballot initiatives in Idaho are treated like bills passed by the legislature; the governor can block them.
• Labrador would not rule that out during a debate. One of his primary opponents, Lieutenant Gov. Brad Little, said he would "adhere to the will of the voters."

Why it matters: Ballot initiatives are one of the only tools left on the table in the states that haven't yet expanded Medicaid, but this is a reminder of the limits to that strategy.

• It won't work everywhere (some states make it almost impossible to get on the ballot), and elected officials still have a lot of power in many places to counteract ballot initiatives they don't like.

A federal court has dismissed Envision Healthcare's lawsuit against UnitedHealthcare, citing the two companies' contract that says disputes must be settled by arbitration, Bob reports.

The bottom line: This is a large victory for UnitedHealthcare, which terminated its contract with Envision and now has the upper hand in negotiating rates for Envision's health care services.

• The big questions are when the two sides will come to a new agreement, and how patients who use emergency rooms with these companies will be affected.

• Ronny Jackson will not be returning to his role as the White House physician, Politico reports.
• Unsurprisingly, Democrats and watchdogs are raising questions about the CDC director's $375,000 salary, The New York Times notes.
• Bill Gates says we're not prepared for a global pandemic and he's sponsoring a $12 million challenge grant to help spark research into a universal flu vaccine.