Veteran Oversight Now

Mary Estacion
Welcome back to another episode of Veteran Oversight Now, an official podcast of the VA Office of Inspector General. I’m your guest host, Mary Estacion.

Each month on this podcast, we’ll bring you highlights of the OIG’s recent oversight activities and interview key stakeholders in the office’s critical work for veterans.

Joining us today is the VA’s Inspector General Michael Missal, who will discuss the OIG’s latest Semiannual Report to Congress, which covers the last six months of fiscal year 2023 from April 1, 2023, to September 30, 2023.

How are you today, Mr. Missal? Recovered from the baseball season yet?
IG Michael J. Missal
I’m fine, Mary. But ugh. You had to bring up baseball! However, it was a really fun baseball season as my Washington Nationals had a much better year than expected unlike your New York Mets. You probably didn’t know this, but baseball has similarities to oversight work as you need to recruit the best talent, be smart in your work, be prepared for all possibilities, and adapt as necessary. I’m looking forward to next year’s season.
Mary Estacion
As much as I’d love to sit here and talk sports with you, let’s get down to business and chat about the 90th Semiannual Report to Congress, or SAR. That’s a big number. But before we get to that, I want to get your take on another epic milestone. It’s been 45 years since the signing of the Inspector General Act. How do you assess the past 45 years? I mean, we wouldn’t be talking here if it weren’t for that monumental enactment!
IG Michael J. Missal
So, Mary, I’m not sure we would be but hopefully we’d be doing something as impactful and as meaningful as working for the VA OIG. But the good news is the IG Act was passed in 1978 and government programs and operations have greatly benefited from the past 45 years of independent oversight. When the Inspector General Act was signed into law on October 12, 1978, it established 12 presidentially appointed IGs in federal departments with a mission to provide independent oversight and promote economy, efficiency, and effectiveness throughout the federal government. VA OIG was one of the original 12. When signing the IG Act, President Jimmy Carter described these new IGs as “perhaps the most important new tools in the fight against fraud.”

I had the opportunity to meet with President Carter on the 40th Anniversary of the IG Act in 2018 and he told me that this was one of the most significant achievements of his administration. Because of this great success of the original 12 IGs, there are now 74 independent federal IGs and over 14,000 OIG staff who oversee federal operations and detect and prevent fraud, waste, abuse, and misconduct.

Since 1978, the VA OIG has grown to more than 1100 employees. About 30 percent of VA OIG staff are veterans, with an even greater number who family members who have served in the military. The work that they do here—auditing VA’s programs and operations, inspecting VA medical facilities and the quality of healthcare, and investigating those who commit crimes and engage in other wrongdoing—remains incredibly impactful and demonstrates the importance and value of strong and independent oversight.
Mary Estacion
Mr. Missal, I imagine technology advances these days really help.
IG Michael J. Missal
Absolutely! We could not come close to accomplishing what we do without the effective use of technology. For example, we use data analytics to identify and inform proactive initiatives. Moreover, access to new technologies has increased the complexity and speed of our projects, which makes our oversight not only more impactful but also more timely. This has never been more important as VA is expending billions of dollars on system modernization efforts for financial management, patients’ electronic health records, and supply chain management. When I look across the VA OIG, whether in our healthcare inspections area, within our auditing teams, by our special reviewers, or among our criminal investigators, I see our staff conducting oversight proactively and efficiently. Using technology strategically allows us to conduct some of our hardest, most complex, and impactful initiatives.
Mary Estacion
That’s great. I can’t wait to see how the VA OIG changes over the next 45 years, though I’ll be watching from retirement for most of it. Let’s focus in on the great work we have done this year, specifically the last six months. Our most recent SAR demonstrates the breadth and depth of our oversight work—certainly something of interest to Congress.
IG Michael J. Missal
Absolutely. So as required by the IG Act, we actively engage with Congress to promptly inform members and their staff on critical issues affecting VA programs and operations. During this reporting period, the OIG participated in eight congressional hearings on topics such as care coordination between VA and community providers, VA spending related to the COVID-19 pandemic, contract disability exams, and care for veterans suffering from substance use disorders. During a hearing before the House Veterans’ Affairs Subcommittee on Oversight and Investigations, Deputy Inspector General Dave Case testified in support of the VA OIG Training Act of 2023. He outlined how this law would provide training to VA employees on their requirements to report to the OIG suspected crimes, as well as the reasons why they should report to the OIG risks to patient safety, and misconduct affecting veterans and VA’s programs, benefits, and services. In practice, this law will help further create an environment where VA employees can report wrongdoing with confidence and without the fear of retaliation.
Mary Estacion
But briefing congressional committees are just a part of how the VA OIG interacts with congressional members, right?
IG Michael J. Missal
Right! But it’s a meaningful one. Over the past six months, the VA OIG conducted 63 briefings on our oversight reports and responded to 75 congressional inquiries. It is important that our teams explain our findings and recommendations and be available to answer questions. For example, OIG staff briefed both the House Veterans Affairs Committee and Senate Veterans Affairs Committee staff on insufficient VA oversight related to the opioid prescribing practices of non-VA community providers following the publishing of two reports, the first, Review of VHA’s Oversight of Community Care Providers’ Opioid Prescribing at the Eastern Kansas Health Care System in Topeka and Leavenworth and the second, Oversight Could Be Strengthened for Non VA Healthcare Providers Who Prescribe Opioids to Veterans. These reports, along with the congressional briefings, helped lead to a letter sent by members of the HVAC to the VA Secretary requesting he closely review opioid community care issues.
Mary Estacion
Wow. That’s a great example of the impact of our oversight work. Turning now to our Counselor’s Office, their use of The Strengthening Oversight for Veterans Act of 2021, which was signed into law in June of 2022, was highlighted in this recent SAR. Can you share the details?
IG Michael J. Missal
Certainly Mary. So, this law which was really important to us gave the OIG the authority to compel testimony from individuals previously out of reach, such as former federal employees, VA contractors’ personnel, and others with relevant information. This is critical so that we can better perform our statutory oversight of VA’s programs and activities. During the prior reporting period, our attorneys provided support to the US Attorney’s Office for the District of Montana in an action to enforce a
testimonial subpoena issued to a former VA employee in September of 2022. This was the first challenge to an OIG testimonial subpoena since the OIG received the authority to issue such subpoenas. In April 2023, the court agreed that the subpoena was appropriate and OIG employees subsequently interviewed the former VA employee to obtain valuable information in support of a healthcare inspection. This example demonstrates the value of this new legislation provides our staff as well as ensures our inspectors and investigators can conduct their important duties to the fullest degree possible.
Mary Estacion
For those who don’t know, the VA OIG investigates a variety of suspected fraud schemes, and there was one in particular that jumped out at me—the defrauding of VA for nearly $105 million. Beyond the large dollar figure, why is this case so important?
IG Michael J. Missal
Yes, you’re referencing the case where a CEO of a technical school defrauded the VA of millions of dollars of education benefits. Our investigation led to the CEO admitting to his role in what we believe is the largest known Post 9/11 GI Bill benefits fraud scheme. So how did this happen? The defendant, along with his coconspirators, falsified attendance records, student grades, and professional certifications to show that they were complying with VA’s 85/15 rule. This rule makes sure the VA is paying for market value for tuition. This is done by requiring that 15 percent of the enrolled students pay the same rate as VA does. The courses also have to be in-person, not online. Not only did the defendants pose as students when the state approving agency came around, they confirmed they graduated and got jobs, all to maintain the school’s eligibility for the program. The CEO got prison time and was ordered to pay back restitution of almost $105 million.

I‘ll add that stopping education benefits fraud continues to be a priority for the VA OIG. I encourage everyone to check our January 2023 fraud alert that is on our website to understand the signs that may indicate a VA-approved school is engaging in education benefits fraud. That’s just one of several regularly published VA OIG fraud alerts, that includes two others on medical identity theft and disability fraud benefits, which were both published in our last reporting period.
Mary Estacion
Wow! I’m glad to hear that those funds will be paid back to VA. And, to reiterate your comment on fraud alerts, I encourage those listening to visit the VA OIG website for a full list of fraud alerts as well as resources that may help identify potential indicators of fraud.

Continuing with investigations, the VA OIG collaborated with several other IGs and the FBI on an investigation into a multibillion-dollar healthcare fraud scheme involving the prescription of medically unnecessary devices and pain creams resulting in a total loss to the government of $2.8 billion. Can you provide details on this case?
IG Michael J. Missal
Sure, Mary and this was a particularly significant case, just given the dollars involved. In this case, there were three executives of a healthcare software and service company who conspired to use telemarketers to reach out to targeted individuals like Medicare, TRICARE, and CHAMPVA beneficiaries to generate orders for them to receive medically unnecessary orthotic braces and pain creams. They paid kickbacks and bribes to doctors who signed the orders. Allegedly, the templates for the doctors’ orders were based on the patients’ interactions with the telemarketers, not the prescribing providers, who were limited in their ability to modify the orders. The prescribing providers received a fee in exchange for each order, and routinely did not contact the patients. The three executives’ company received payments from VA, Medicaid, and other sources for the devices and creams that were improperly prescribed. As you mentioned, the total loss to the government was $2.8 billion, including a more than $1 million loss to VA. Investigations like this one demonstrates the significance of our oversight work, in this case, putting a stop to a scheme that took a large sum of money from VA that otherwise would have been used to support education for our veterans.
Mary Estacion
Unfortunately, in our position here at the VA OIG, we sadly and frequently see the lengths at which some will go to enrich themselves at the cost of veterans and their families. I’m thinking of the investigation into the owners of a company that claimed to provide home health services to veterans. Can you give us a little insight into this case?
IG Michael J. Missal
Sure! These business owners submitted fraudulent applications on behalf of unwitting VA beneficiaries for VA compensation with aid and attendance benefits. These qualified veterans or their surviving spouses that receive aid and attendance benefits receive a higher monthly compensation to assist with daily living activities. Our investigation revealed that the defendants falsely claimed to have provided home assistance to the beneficiaries before submitting the applications and then disguised their role in the application process during their interactions with the victims. They received more than $4 million in VA funds that were intended for more than 300 veterans or their surviving spouses.
Mary Estacion
Let’s change gears and talk a little bit about our Office of Audits and Evaluations. The office had a productive six months, publishing 40 reports, making 215 recommendations to improve VA programs and services. What key areas did the focus, did the office focus on?
IG Michael J. Missal
This past review period, the Office of Audits and Evaluations addressed VA system modernization related to financial management and the electronic health records for VA patients. It also examined areas of tremendous growth, such as care in the community paid for by VA and the processing of specialized disability benefits—even more pressing following passage of the PACT Act that is expected to generate 1.9 million claims for processing. To ensure VA is also being effective stewards of taxpayer dollars, audit staff continued to monitor significant spending. Audit’s work also continues to delve into root causes for deficiencies and finding weaknesses in VA’s governance. Several of these issues were highlighted in congressional testimony and media coverage over the past six months. For example, the VA OIG continues to spotlight the risks associated with VA’s outdated financial management system. We testified before Congress in June on concerns with VA’s financial management transformation effort. VA has also struggled to ensure accountability and transparency in how it obligates and expends funds as shown in the report “VA’s Compliance with the VA Transparency & Trust Act of 2021” that we published in September.
Mary Estacion
Speaking of financial transparency, the VA OIG identified issues with how the VA accounted for the supplemental funds it received to prevent, prepare for, and respond to the COVID-19 pandemic. What happened here?
IG Michael J. Missal
Well, this is another example of VA’s ongoing struggles to improve financial transparency. In this case, because of VA’s financial management system does not support the direct obligation of supplemental funds for all expenses, staff used expenditure transfers to shift funds between appropriation accounts. However, due to VA’s lack of guidance, staff did not always sufficiently document the transfers, which is key. In addition, even when staff directly obligated CARES Act funds, they did not always follow key fiscal controls, such as segregating staff duties and properly tracking the receipt of goods. As some transactions were noncompliant with key fiscal controls, VHA and Congress lack assurance that CARES Act funds were used for veterans’ COVID-19-related needs, and the OIG questioned an estimated $187.2 million in CARES Act funding. I testified before Congress in May 2023 on the need for corrective action in regard to financial management problems and supplemental funding oversight deficiency. VA still has work to be done and we will continue to monitor VA’s progress in these areas.
Mary Estacion
Sounds like it, sir. Continued oversight of VA’s spending is critical as seen in a September report, titled Manufacturers Failed to Make Some Drugs Available to Government Agencies at a Discount as Required. What are the big takeaways from this report?
IG Michael J. Missal
So, in 1992, Congress passed the Veterans Health Care Act, which required manufacturers to offer pharmaceuticals to government customers at a discount of at least 24 percent off the market price. Drug manufacturers that comply with the public law not only gain the business of the entire
federal government, but also become eligible to participate in federal government-funded programs including Medicare and Medicaid. During fiscal year 2021, the federal government spent about $13.2 billion on pharmaceuticals via Federal Supply Schedule contracts managed by the VA. The OIG found manufacturers did not make 22.8 percent of drugs covered in the law available on the Federal Supply Schedule as required. This resulted in an estimated $28.1 million in overcharges to VA and the Department of Defense. To reduce noncompliance and keep drugs more affordable, the OIG made eight recommendations.
Mary Estacion
Let’s talk about healthcare inspections now. We’re one of the few federal IGs that also conducts healthcare inspections, which in our case means traveling to VA medical facilities around the country. What’s new in our healthcare inspection area?
IG Michael J. Missal
Well, first of all, we think we are preeminent in the healthcare inspection area. In this reporting period, the Office of Healthcare Inspections or published 60 reports, including seven national healthcare reviews, 16 reports responsive to OIG hotline complaints, and one management advisory memorandum. These 24 reports addressed a wide variety of topics, such as weaknesses in credentialing and privileging healthcare providers, noncompliance with community care referrals, and failure to adhere to opioid safety protocols. Of the remaining 36 reports, two were generated from the Vet Center Inspection Program; 31 were facility-level comprehensive healthcare inspection program reports, two addressed the VISN level, and one was a joint report developed as part of the Pandemic Response Accountability Committee… that’s a handful… Health Care Subgroup. Needless to say, our healthcare inspectors stayed busy and did impactful work. They focus on assessing areas for which continuous improvements and accountability were key to providing appropriate healthcare and advancing patient safety. Reports related to these efforts emphasized the importance of strong leadership throughout the Veterans Health Administration.
Mary Estacion
Let’s talk about a couple of those national healthcare reviews, specifically the reports covering telehealth and staffing shortages. In April, we published the report Review of Access to Telehealth and Provider Experience in VHA Prior to and During the COVID-19 Pandemic. What did we learn from this effort?
IG Michael J. Missal
So, what we learned for this report was that we reviewed the implementation and use of VA Video Connect prior to and during the pandemic, why providers used telephone communications more frequently than video connect at the outset of the COVID-19 pandemic, and how VHA resolved technology issues. What we found is that telephone and video connect use increased as presumed in-person encounters decreased at the start of the pandemic. However, telephone use decreased, and video connect encounters continued to increase after the initial months of the pandemic. The OIG concluded that the pandemic served as the impetus for VA Video Connect use and VA providers identified that it increased patient engagements while remaining convenient. However, they also described barriers to using Video Connect, including patients’ challenges with the video technology, video appointments not matching in-person appointments, and provider difficulty with scheduling video appointments. Ultimately, we made three recommendations.
Mary Estacion
What about our annual staffing shortages report? Report findings identified, unfortunately, some real ongoing challenges for VA.
IG Michael J. Missal
That’s right and this has been going on for a number of years. So, we annually determine a minimum of five clinical and five nonclinical VHA occupations with the largest staffing shortages within each VHA medical center. The number of severe shortages is also compared against the previous four years’ reports to assess changes. One of the most significant findings in this year’s staffing report was that severe shortages increased in fiscal 2023 from fiscal year 2022. This followed annual decreases during fiscal year 2018 through fiscal year 2022. In addition, 88 percent of facilities reported severe shortages for medical officer positions and 92 percent reported severe shortages for nurses, with practical nurse and medical support assistance being the most frequently reported clinical and nonclinical occupations with severe shortages, respectfully. All 139 facilities surveyed reported at least one severe shortage. Overall, the total number of severe shortages increased by 19 percent in fiscal year 23 over fiscal year 22.
Mary Estacion
Ok. So, the VA has some to work do filling those roles across the VA medical facilities nationwide. With facilities seemingly everywhere, our healthcare inspectors are true road warriors. I’m particularly impressed with our Comprehensive Healthcare Inspection Program report teams. These teams truly have their “boots on the ground.” We visited 31 facilities this reporting period with a focus on five key areas (1) leadership and organizational risks; (2) quality, safety, and value; (3) medical staff privileging; (4) environment of care; and (5) mental health or emergency department and urgent care center suicide prevention initiatives. Why is inspecting facility leadership so important?
IG Michael J. Missal
Leadership is key to so many different things. As the largest integrated healthcare system in the country, VHA requires its leaders to be engaged and proactive to make certain that veterans receive the quality care they deserve. Leaders must establish and maintain a culture of safety and accountability, including a work environment in which all staff members fully understand their roles and responsibilities, as well as their duty to report problems and potential risks to patients. We publish several reports that highlight the negative impact of absent or passive leadership in overseeing critical healthcare operations, such as suicide prevention and care coordination. Undefined leadership roles and responsibilities, as well as conflicting or unclear guidance, repeatedly undermine the ability of staff and leaders to deliver high-quality care.
Mary Estacion
Before we go, it’s clear by reading through the SAR, the amount of work completed by the VA OIG. When you think about the people doing it, what comes to mind?
IG Michael J. Missal
Mary, when I think about our staff, the phrase ‘dedicated to the mission’ comes to mind. They work tirelessly on behalf of our veterans and their families, as well as the American taxpayer. In fact, about 30 percent of our staff are veterans and even a greater percentage have family members who have served in the military. During the past six months, our staff identified more than $1.14 billion in monetary impact. That’s a return on investment of $11 for every dollar the government spends on us. I am so impressed and proud of the work done by our staff. Given their dedication to the mission, they are equally proud of the impact we have for veterans and their families.
Mary Estacion
Wow! Those are impressive numbers, Mr. Missal. Thank you for your time today. Is there anything else you would like to add before we sign off?
IG Michael J. Missal
As always, it’s been a pleasure speaking with you. As the only the sixth Senate-confirmed VA Inspector General over the past 45 years, it is truly an honor and privilege to work on behalf of veterans and taxpayers. It is also a real honor and privilege to work with all of our staff to meet our mission of meaningful independent oversight. We had a great fiscal year 23 and we look forward to an even more impactful fiscal year 2024. And I look forward to talking to you again next year about our results.
Mary Estacion
Thank you, IG Missal. And just like the IG said, if you’d like to read the Semiannual Report or any publication from the Office of Inspector General, visit our website at vaoig.gov. Next up, a recap of October’s monthly highlights.

From the Office of Investigations comes a report of a medical imaging company and its chief executive officer allegedly paying kickbacks to cardiologists in exchange for patient referrals, which resulted in fraudulent claims to various federal healthcare programs. The medical imaging company entered into a settlement agreement of $75 million and its chief executive officer for $10.4 million. The total loss to VA is about $4.4 million. This case was investigated by the VA OIG, along with offices of the Inspectors General from Health and Human Services, Defense Health Agency, and the Railroad Retirement Board.

In another case, the president of a medical technology company conspired to improperly bill healthcare insurers for approximately $77 million in false claims for allergy and COVID-19 testing. The president and others schemed to manipulate the company’s stock price by making numerous misrepresentations to potential investors concerning the company’s ability to provide accurate, fast, and cheap COVID-19 tests in compliance with federal and state regulations. These misrepresentations included the false claim that the company was in a $2.5 million agreement with VA when in reality, it was not. The defendant was sentenced in the Northern District of California to 96 months and 60 months of incarceration to be served concurrently, 36 months of supervised release, forfeiture of $2.7 million, and restitution of $25 million after being found guilty at trial of conspiracy to commit healthcare fraud, conspiracy to commit wire fraud, healthcare fraud, securities fraud, conspiracy to pay kickbacks, and payment of kickbacks. This investigation was conducted by the VA OIG, the US Postal Inspection Service, DCIS, and the HHS OIG.

From the Office of Audits and Evaluations, the VA OIG audited the Veterans Health Administration or VHA for its compliance with the directive to prevent and control healthcare-associated legionella disease at VHA-owned buildings. The OIG reviewed four VA medical facilities—in Salem, Virginia; Brooklyn, New York; Pittsburgh, Pennsylvania; and Dublin, Georgia—and found they did not fully comply with VHA requirements on components of their legionella disease prevention plans, water safety testing validation collection, remediation actions, and reporting practices. VHA leaders also did not receive complete water safety test results needed for effective oversight. In addition, VA medical facility leaders responsible for notifying its clinical staff of legionella conditions did not communicate positive test results to ensure awareness of elevated diagnostic levels. The OIG made eight recommendations to improve oversight of water sampling, fix identified problems, and ensure VHA Directive 1061 is followed.

Our healthcare inspectors published a report about deficiencies at the Michael E. DeBakey VA Medical Center in Houston, Texas. From 2018 through 2021, facility leaders, in consultation with VISN leaders, were found to have taken progressive actions to address a provider’s surgical practices, completed root cause analyses, or RCAs, for each critical surgical event, and implemented additional actions to improve processes. But the OIG identified failures in reporting to state licensing boards and the national practitioner data bank, as well as deficiencies in RCAs’ timeliness, measurability, and sustainability. The inspection team determined that three critical surgical events may have been prevented in the absence of the RCA deficiencies. The medical center director concurred with the OIG’s three recommendations related to professional evaluation, reporting, and RCAs.

The Comprehensive Healthcare Inspection Program, or CHIP, continues to be a critical element of the OIG’s overall efforts to ensure that the nation’s veterans receive high-quality and timely VA healthcare services. The inspections are performed approximately every three years for each facility. The OIG selects and evaluates specific areas of focus on a rotating basis. This month’s CHIP reports focused on three facilities: the Royal C. Johnson Veterans’ Memorial Hospital in Sioux Falls, South Dakota; the Veterans Health Care System of the Ozarks in Fayetteville, Arkansas; and the James E. Van Zandt VA Medical Center in Altoona, Pennsylvania.

For more information about these and the other activities the VA OIG has been working on, go to our website at www.vaoig.gov. Stay connected by signing up for notifications whenever the VA OIG publishes a new report. Visit our website and click on the sign-up button.

Check out other episodes wherever you listen to podcasts.

Stay tuned for more highlights next month. Thanks for listening.

This has been an official podcast of the VA Office of Inspector General. Veteran Oversight Now is produced by the Office of Communications and Public Affairs and is available at va.gov/oig.
Tune in monthly to hear how the VA OIG serves veterans, their families, and caregivers through meaningful independent oversight. Report potential crimes related to VA waste or mismanagement; potential violations of laws, rules, or regulations; or risks to patients, employees, or property to the OIG online or call the hotline at 1-800-488-8244.