A politically moderate former hospital executive who also served in the Obama administration, Dr. Shulkin had been one of Mr. Trump's most popular cabinet secretaries, both in the White House and on Capitol Hill.
And Mr. Trump has publicly showered Dr. Shulkin with praise.
With the capital reeling from the abrupt firing of Secretary of State Rex Tillerson, speculation swirled Tuesday night that President Donald Trump may continue the shakeup by firing his veterans secretary and moving Rick Perry to that troubled department. "We will never use those words on you, that's for sure".
The conservatives came to feel that Dr. Shulkin, who advocated a moderate rewrite of the current private care programs, was an obstacle to their goal.
A VA Inspector General report last month revealed Shulkin allegedly attempted to cover up a taxpayer-funded 10-day European excursion his wife went on last summer that was initiated through doctored emails. The energy department did not immediately respond to a request for comment about the report, nor did the White House.
Meanwhile, Shulkin reportedly believes that Trump appointees within the department have been conspiring against him and embarked on a campaign to purge the VA of disloyal employees.
The secretary appeared to be regaining his footing.
Trump had lunch with Perry on Monday and gushed about him at an East Room event honoring the World Series-winning Houston Astros. The source was not authorized to discuss internal deliberations.
Shulkin told the newspaper that Kelly and President TrumpDonald John TrumpAccuser says Trump should be afraid of the truth Woman behind pro-Trump Facebook page denies being influenced by Russians Shulkin says he has White House approval to root out "subversion" at VA MORE supported the secretary removing staffers who didn't back him.