WASHINGTON -- Even after eliminating half of its hospital beds in the last five years, the Federal health care system for military veterans still spends more than $1 million a day to operate unneeded hospital buildings, where a dwindling number of veterans receive care in underpopulated wards, Federal investigators say.

The Department of Veterans Affairs receives more than $17 billion a year to provide health care to veterans, but spends one-fourth of the money caring for the 4,700 buildings at its medical centers around the country, the investigators said. Forty percent of the buildings are at least 50 years old, and many are listed on the National Register of Historic Places.

Federal investigators said that if the Government shut down some of the buildings, it could use the money to provide more health care to more veterans in outpatient clinics and at private hospitals closer to their homes.

Admissions to veterans hospitals have fallen sharply because the number of veterans is declining and care is shifting to outpatient clinics from hospital wards.

While Congress is moving to make it easier for the Department of Veterans Affairs to close unneeded hospitals, the agency shows little interest in doing so, and veterans groups, one of the more powerful lobbies in Washington, are resisting.

The General Accounting Office, an investigative arm of Congress, said in a recent report that it might actually be in the interest of veterans to close some hospitals because that would free money to enhance other health care services for veterans.

Representative Cliff Stearns, a Florida Republican who is chairman of the health subcommittee of the Committee on Veterans Affairs, said, "We should be taking care of veterans, not buildings."

Representative Corrine Brown, Democrat of Florida, said the department was "shortchanging the delivery of health care services so it can heat empty, obsolete buildings."

Veterans groups see the hospitals as a national asset that must be preserved, a lifeline for veterans suffering from severe illnesses and injuries. They say veterans have earned the right to care. In a letter to Congress this week, Steve A. Robertson, legislative director of the American Legion, said his organization "does not believe there are any unneeded V.A. facilities" and "does not believe that any strong case has been made to close one V.A. medical center."

The veterans department operates the nation's largest health care delivery system, with 172 hospitals, 132 nursing homes, 73 home health care programs and more than 650 outpatient clinics.

The department's real estate includes two sophisticated teaching hospitals just six miles apart in downtown Chicago; tiny hospitals with fewer than 20 beds in Missouri and Pennsylvania, and a big medical center with 100 buildings in Indiana.

About 1,600 buildings, more than one-third of the total, are so old that they are formally listed or eligible for listing on the National Register of Historic Places, a distinction that requires the Government to protect their historic character when making alterations.

Some were military forts or barracks.

Some of the hospital sites, with more than 50 buildings, look like small towns or college campuses.

Of the 4,700 buildings, fewer than 1,200 actually provide medical care to veterans. Some of the buildings are empty. Some are used as warehouses, engineering shops, laundries, firehouses and boiler plants.

"We are spending zillions of dollars to keep up vintage 1930's buildings that are not designed to provide modern health care," said Dr. Kenneth W. Kizer, who was Under Secretary of Veterans Affairs for five years, until June 30, and is now the department's chief consultant on health care. "We probably have 30 hospitals with a daily census of 20 to 40 patients. When you get down to a census that low, the hospital is incredibly expensive to maintain, and the quality of care suffers. If you have a heart attack, you don't want to go to a hospital that last saw one six months ago."

Dr. Kizer has orchestrated radical changes in the system, which serves 3.6 million of the nation's 25 million veterans each year. He forced hospitals into regional health care networks, slashed hospital admissions, emphasized outpatient care and shifted money away from the Northeast to Sun Belt states in the South and the West, where many veterans now live.

But Stephen P. Backhus of the General Accounting Office said the transformation of the veterans health care system "appears to be losing momentum" as the agency postpones tough decisions about closing hospitals.

In a recent speech to the American Legion, Togo D. West Jr., the Secretary of Veterans Affairs, said: "We are closing no medical centers this year. We have no plans to close any medical centers next year."

Most veterans hospitals, Backhus said, already have "excess inpatient capacity," and the department will probably need only 10,000 hospital beds in 2010.

At the same time, the number of military personnel has been declining since the end of the cold war. The number of veterans is expected to drop by 36 percent, to 16 million, by 2020.

The House committee recently approved a bill that would make it easier for the Secretary of Veterans Affairs to close obsolete, inefficient hospitals and use the money saved to build outpatient clinics or upgrade other medical services to veterans. The bill would also make it easier for the department to keep money from the sale or lease of its property.

In a week or two, the full House is expected to consider the bill, which has bipartisan support. The Senate is working on similar legislation.

The number of hospital beds in the veterans system has declined by 55 percent, to 23,850 today from 53,082 in 1994, while the number of outpatient visits to clinics and hospitals increased 39 percent, to 35 million last year from 25.2 million in 1994.

In some markets, V.A. hospitals and clinics compete with one another to serve a rapidly declining population of veterans. Many veterans hospitals are near private hospitals that also have unused beds. The Government is allowed to buy care for veterans at such hospitals, but has used this option to only a limited degree.

Representative Terry Everett, Republican of Alabama, said that efforts to close veterans hospitals had been opposed by labor unions, local elected officials, members of Congress and medical schools that use the hospitals for teaching and research.

Steve Thomas, a spokesman for the American Legion, said, "Those who sacrificed for freedom should not have to sacrifice health care."

Another group, Paralyzed Veterans of America, has expressed concern that the closing of hospitals would damage the Government's ability to care for veterans with spinal cord injuries. The V.A. pioneered the treatment of such injuries, but Richard B. Fuller, legislative director of the organization, said, "These specialized services are in jeopardy" because they cannot easily be provided in outpatient clinics.

Many health care experts see a surplus of hospital beds in the Chicago area, which has four veterans hospitals. The General Accounting Office says the Government could save $20 million a year and still meet the needs of veterans if it closed one of the hospitals.

Dr. Daniel H. Winship, dean of the School of Medicine at Loyola University in Chicago, said: "Chicago does not need four V.A. medical centers. It could do well with two or, more optimally, with three."

In theory, the two hospitals six miles apart in downtown Chicago, Lakeside and West Side, are being "integrated" under a single management team. But Dr. Winship said there was still "a great deal of duplication of medical services," in part because medical schools were reluctant to combine training programs at the hospitals.

Veterans hospitals are affiliated with 107 medical schools across the country and have provided training to more than half of the nation's doctors.

They have conducted important research on AIDS, cancer and hundreds of other topics.

But Dr. Kizer said the medical schools had been "a big obstacle" to change at V.A. hospitals because "they have a difficult time recognizing that most health care will be provided in an outpatient setting in the 21st century."

The first V.A. hospital closing in decades came about not because of farsighted health planning, but because of an earthquake. The department closed a medical center in Martinez, Calif., and decided not to build a replacement hospital. Instead, it established a full-service outpatient clinic and signed contracts with private hospitals to care for veterans closer to their homes.

But the agency also continues to operate small hospitals.

William P. Cockerill, director of resources at the V.A. Medical Center in Poplar Bluff, Mo., said his hospital had 16 beds, down from 225 in 1990. Laurie Tranter, a spokeswoman for the Department of Veterans Affairs, said the agency was operating medical centers with just 8 hospital beds in Butler, Pa., 17 beds in Iron Mountain, Mich., and 25 beds in Bath, N.Y.

In addition, auditors say, the department spends $35 million a year to maintain vacant space in various buildings.