Veteran Oversight Now

(as prepared)

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

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 second half of fiscal year 2022 from April 1 to September 30.

Mr. Missal, this is the 88th Semiannual Report to Congress, or SAR, prepared by the VA OIG—the 13th during your time as the inspector general. What story does this latest edition of the SAR tell about the OIG’s recent oversight activities?

IG Missal:
Wow, time really flies! First of all, I know you are relatively new here, Austin. I just want to welcome you to the OIG. I hope that you find this the most fulfilling professional job that you have in your career. With respect to the SAR, I think this SAR demonstrates the OIG’s commitment to effective oversight, particularly with respect to large-scale initiatives we’ve been doing that really have great impact on both the department as well as the lives of veterans and their families. In this reporting period, we published five reports on the electronic health record modernization effort, including a joint report with our colleagues at the Department of Defense OIG. Additionally, in light of the passage of the PACT Act, which could be the largest increase in health care and benefits for veterans, we released two reports related to burn pits and one that focused on toxic exposure at Camp Lejeune.

But I think this SAR also highlights our continued focus on being proactive. Our proactive cyclical inspections are central to the oversight operations and shouldn’t be overshadowed by our higher-profile products. For example, we published 17 reports under our long-established Comprehensive Healthcare Inspection Program, also known as CHIPS. Our Vet Center Inspection Program, another proactive cyclical program, stayed active this reporting period, and even though no reports were published under that program, we’re planning to release several in FY 2023. We also released the first report under our new Care in the Community Inspection Program, which examines the processes associated with providing quality care in selected VA community-based outpatient clinics and through contracted non-VA care providers.

Austin Fox:
The OIG certainly has a lot going on—and the impact has been remarkable. According to the SAR, in this past six-month period, the OIG identified more than $1.4 billion in monetary impact for a return
on investment of $16 for every dollar spent on oversight. That brings this fiscal year totals to nearly $4.6 billion in monetary impact and $24 for every dollar spent. The OIG hotline received and triaged close to 18,400 contacts in the past six months—36,000 for the whole year. Criminal investigators opened 178 new cases since April, closing 213 and making 135 arrests. Now, what do you, as the IG, make of these numbers?

IG Missal:
These numbers certainly reflect the tremendous impact of our work and that veterans and their families are really looking to us to ensure they get the high-quality health care and benefits that they deserve. However, I’ve always said numbers only tell a part of the story, and the OIG’s real value is the impact it has on VA and the lives of individual veterans and their family members.

You mentioned 135 arrests. One of the people arrested was a fiduciary who was allegedly stealing money from her veteran uncle. Now this case may not be considered “high impact” given VA’s budget is almost $300 billion, but it’s certainly high impact to this one veteran. For us, every veteran matters. I can’t say whether his life has improved since the arrest, but at least now he’s getting the compensation he deserves for serving our country with honor. And that’s an important part of our mission. To take another example, VBA recently established an operations center specifically to improve the processing of military sexual trauma claims. Our auditors found that half of the military sexual trauma claims processed during a six-month period had been denied prematurely. I can’t imagine how devastating it would be for someone to endure sexual trauma while serving their country, only for their country to turn around and deny them the compensation they deserve afterwards. If the operations center does what it’s supposed to do, which is improve the MST claims process to prevent premature denials, then the future impact on veterans who file these claims would be immeasurable. And that’s just one OIG recommendation. We made 894 this past fiscal year.

Austin Fox:
Yes, it’s interesting how the OIG’s range of work starts at the level of the individual and scales up through the various levels of the organization, everything from specific programs and facilities to the department as a whole. And the SAR illustrates this versatility more than any other OIG publication. Focusing specifically on the OIG’s Office of Investigations, which—just by the very nature of its work—addresses crime and wrongdoing mostly at the individual level, can you talk about some of the new initiatives this office has implemented to help detect and investigate crimes?

IG Missal:
I’m happy to do so. The Office of Investigations has been really increasing efforts to raise awareness within the department and the veteran community on how to spot suspicious activity and how to report it to the OIG. We developed an online toolkit that provides a list of key possible indicators specific to 10 different kinds of fraud and identifies common signs of alleged wrongdoing. Investigations also started disseminating periodic crime alerts, including one on fraud schemes in which VA was billed for unreceived home health care or other veteran services and another on genetic testing scams. The more visibility we can have, the more opportunities to prevent and stop crimes we will have.

Austin Fox:
It seems logical that the pandemic, among its many unfortunate impacts, would give rise to a greater number of healthcare testing scams. I saw at least two such scams in the OI section of the SAR, both related to COVID-19 testing. Can you share a little about these cases?

IG Missal:
Yes, and they’re both such sad cases. Each of the six SARs we’ve released since the beginning of the pandemic, including the current SAR, details at least one scam we’ve investigated that involves fraudulent healthcare testing. That’s why we disseminated the crime alert to the veteran community—to raise awareness of this awful trend in criminal behavior. One of the cases that we talk about in this SAR involved a business owner from Georgia who worked with conspirators at several medical testing companies. He would provide these companies patient leads for, at first, genetic screening tests for cancer, in exchange for a thousand-dollar kickback. These tests were, of course, medically unnecessary. When the shortage of COVID-19 tests reached crisis levels in communities throughout the country, this person saw that as an opportunity to extend his scheme. He started getting paid kickbacks for each COVID-19 test submitted to a laboratory, as long as those tests were bundled with significantly more expense respiratory pathogen panel test that did not detect COVID-19—regardless of the medical necessity for either test.

Austin Fox:
How did that case end?

IG Missal:
Due to the great work of our investigators—and we have an incredibly talented and dedicated group of investigators—we were able to secure a guilty plea. The charges were conspiracy to commit healthcare fraud and conspiracy to violate the Anti-Kickback Statute, which together carry a maximum prison sentence of 15 years.

Austin Fox:
What happened in the second case?

IG Missal:
The second case was similar, but it involved a lot more money—upwards of $10,000 per fraudulent test—leading to about $77 million in false claims. The loss to the government in the first case was only about $1.1 million. In this second case, the president of a medical technology company used deceptive marketers to trick patients into receiving unnecessary allergy tests. The marketers would be paid kickbacks for obtaining patient blood specimens that he could test. Most of the patients didn’t need the allergy testing at all, and it turns out that the specific test he was running wasn’t even a diagnostic test. He, again, charged the government $10,000 per test, which is more for blood-based allergy testing than any other laboratory in the United States. A federal jury found him guilty of 10 different felonies, and he’s currently awaiting sentencing.

Austin Fox:
Wow. And this case was also related to COVID-19?

IG Missal:
Yes, that’s correct. Just like in the first case, when the country was reeling from the shortage of COVID-19 tests, this person saw a perfect opportunity to capitalize illegally. He announced that his company developed a new COVID-19 test and adjusted his marketing plan accordingly, spreading false information that Dr. Fauci and other government officials mandated everyone be tested for COVID-19 and allergies at the same time. He also claimed that his company’s COVID-19 test was more accurate than the PCR test. In reality, his test was denied an emergency use authorization because it was found not to be accurate enough. He’s facing something like 65 years in prison.

Austin Fox:
I’d like to switch gears to individual wrongdoing of another type. The OIG’s Office of Special Reviews conducts administrative investigations on high-ranking officials within VA who may have engaged in misconduct. The SAR details an administrative investigation involving VA’s EHRM effort, specifically two senior VA officials who provided inaccurate information to the OIG regarding proficiency test scores for VA staff using the new EHR. They submitted data that showed pass rates that were significantly more favorable than the actual pass rates for these tests. In other words, a lot more staff were not as proficient at using the new EHR as they let on. Given the significance of the new EHR, given the sheer magnitude of the effort—it’s a multibillion-dollar project—it’s not difficult to see a scenario where VA might deliberately manipulate the numbers to make it appear as though things are going better than they are. Did the officials in this investigation mislead the OIG, and therefore the public, deliberately?

IG Missal:
First of all, you’re absolutely right about the new electronic health record system that’s being implemented now. It’s such an incredibly expensive project, but as importantly, if not more importantly, it could have such an impact on the quality of health care that VHA provides. In this situation, we are devoting a lot of resources toward its oversight, just given the importance. I’m confident that our thorough and proactive reviews of this program are constructive and will help VA implement the new system very efficiently and in a manner that improves both veterans’ health care and staff’s experiences. In this reporting period alone, we published five reports related to the new EHR, including two by the Office of Special Reviews, which conducts reviews of any significant event or issue that doesn’t fall squarely within the focus of another OIG directorate, including non-criminal investigations of high profile officials at VA. In fact, OSR took the lead on the joint audit with the DoD OIG, which also focused on the implementation of the new EHR.

But the answer to your question about whether or not the officials mislead the OI—the answer is no. Thankfully, OSR found that the inaccurate numbers reported by VA were likely the result of either a miscommunication or a misunderstanding with the contractors who prepared the data, rather than on any deliberate effort to mislead. It turns out that the dataset that they submitted, which showed an 89 percent pass rate on the EHR proficiency test, didn’t include all trainees. In fact, it excluded all of the trainees who failed! When you add those trainees back in, the overall pass rate drops to 44 percent. Since this review, the secretary has directed one-time mandatory training for all VA personnel on reporting to and engaging with OIG oversight staff.

Austin Fox:
You mentioned that the OIG published five different reports focusing on the new EHR during this reporting period. Besides the joint audit with the DoD OIG, which identified multiple deficiencies that have impeded interoperability between the two departments, the report that really stands out was one of the 41 reports released by the Office of Healthcare Inspections. This report focused on something referred to as the “unknown queue.” Can you tell us a little about this finding?

IG Missal:
Sure. Our team at the Office of Healthcare Inspections found that the new electronic health record system sent thousands of orders for medical care to an undetectable location, sometimes referred to as the unknown queue, instead of to the intended care or service locations—such as specialty care, laboratory, diagnostic imaging, etc. The new EHR was set up so that healthcare providers who were making orders for patients were required to select a facility location for each order. So, what that means is, they had to select the location from a drop-down list. The new EHR verifies that the selected location matches the specific order. It does this through a process of data mapping in the underlying software code. So, it sounds a little complicated, but it’s really having a drop-down list, having a location, then if that location matches, the order was completed, and the patient received the service requested. However, if a mismatch occurred—if the wrong location was sent— then the order was sent not to where it should have been, but to the unknown queue without anyone knowing. And that’s the key thing with this one. They just didn’t know. The new EHR would actually indicate to the provider who made the order not that it was sent to the unknown queue, but that the entry was successful. So, the provider believed that the order was actually submitted. However, we now know this was not the case for more than 11,000 orders placed between October 2020, which was the go-live date when it first was implemented, and July 2021.

Austin Fox:
The report also discusses instances of this unknown queue actually causing harm to some patients—is that correct?

IG Missal:
Yes, unfortunately that’s correct. VHA assessed the unknown queue with respect to the safety risk and harm that it poses to patients and determined the lack of knowledge and maintenance of the queue caused harm to nearly 150 veterans. This includes two veterans who suffered what VHA called major harm, which is defined as the permanent lessening of bodily functioning not related to the natural course of the patient’s illness or underlying condition. In 2021, VHA, along with its contractor Oracle Cerner, took actions to minimize orders being routed to the unknown queue, but more work still needs to be done. In May 2022, our team found that more than 200 orders were in the unknown queue. In June 2022, when the OIG met with VA leaders to discuss this report, VA said that work to address the unknown queue was considered complete and that, on average, there were 28 orders in the unknown queue on a particular day. However, on that very day we met with them, we generated a report which showed 522 total orders in the unknown queue, across six different facilities. The failure to immediately address such a harmful deficiency can only erode the trust of the staff dedicated to the mission of delivering care and the trust of the veterans who have been promised that care.

Austin Fox:
I imagine the OIG will continue its oversight of the new EHR for many years to come, regarding not only this specific unknown queue issue but many others.

Now switching gears to another, perhaps equally impactful development, I want to talk about the PACT Act, which you note in the SAR as having been described as “the largest healthcare and benefit expansion in VA history.” It’s possible that the PACT Act affects as many as 3.5 million veterans who may have been subjected to burn pits and other toxins during their service. The SAR includes summaries of two burn pit-related reports released by the Office of Audits and Evaluations. One of them was related to veterans receiving premature denials for burn pit-related claims. What were the findings of this report?

IG Missal:
This report is another critical report for our office, and again shows being proactive can be very beneficial for veterans. The overall finding by our audit team was that VBA could improve its oversight and processing for these burn pit claims. The team looked at three samples of medical conditions that could be related to burn pit exposure. The first sample included conditions from VBA-identified burn pit–related claims where compensation was granted, while the second sample included those that were denied. The third sample included conditions from claims VBA did not identify as related to burn pit exposure at all.

They found the first sample—claims where compensation was granted—was mostly processed correctly, but there were a few instances of overpayments to veterans. The second sample, the denials—this was a big issue—was a little more problematic. We found premature denials stemming from multiple errors, including staff failing to request medical opinions about whether conditions were due to burn pit exposure or failing to provide or direct the examiner to review the burn pit fact sheets. All of this was due to confusing guidance about how to process these claims. The VBA medical examination request application not including burn pit exposure in its list of options was another issue and there was also a lack of oversight. Of the 1,000 conditions processed during the review period—again, these are conditions specifically associated with VBA-identified burn pit-related claims—we estimated 870 out of the 1,000 were processed incorrectly, with 630 having the potential to affect the amount of benefits granted.

The third sample was even more problematic. Based on the sample, the team estimated that 97 percent of conditions that were not identified by VBA as related to burn pit exposure were processed improperly. In this case, we found VBA staff failing to take development actions to determine if claimed conditions were due to burn pit exposure. And we included in our recommendations that VBA review all of these denials, and they concurred and agreed to do so.

Austin Fox:
Wow, that’s incredible. Mr. Missal, thank you for your time today. Is there anything else you would like to add before you sign off?

IG Missal:
Austin, I really want to take this opportunity to thank our staff for their dedication and commitment to our mission. We could not accomplish what we do without their incredible efforts. We make a real difference for veterans and their families every day. I encourage listeners to visit our website and read the Semiannual Report to Congress as it summarizes the scope and breadth of our oversight work and the value we bring to our veterans and their families. I look forward to speaking with you again.

Austin Fox:
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 va.gov/oig. Next up, a recap of October’s monthly highlights.

And now for some highlights of the VA OIG’s work from October 2022. I’ll start with investigations.

There were significant updates to 13 VA OIG investigations this month. I’ll summarize a few of them here.

A nonveteran sold fentanyl to a veteran residing in a homeless shelter on the grounds of the VA medical center in Butler, Pennsylvania. The veteran was later found deceased in his room by VA Police Service. The autopsy and toxicology results determined that the veteran died from a combined drug poisoning that included fentanyl. The defendant was sentenced in the Butler County Court of Common Pleas to 66 to 144 months’ imprisonment after pleading guilty to a first-degree felony charge of drug delivery resulting in death. The VA OIG, VA Police Service, Pennsylvania State Police, and Butler County District Attorney’s Drug Task Force conducted the investigation.

Another VA OIG investigation resulted in charges alleging that a former employee at the VA regional office in Bay Pines, Florida, opened a joint bank account that listed a friend, who is a veteran, as the other accountholder. The defendant allegedly directed the veteran’s VA compensation benefits to be deposited into this joint account. The veteran had been awarded VA compensation benefits without their knowledge and despite never having submitted a claim. The defendant allegedly used the funds for his own expenses. The loss to VA is approximately $568,000.

Another VA OIG investigation revealed that a former VA-appointed fiduciary misappropriated funds intended for her husband by spending the money on methamphetamine for herself, others, living expenses for five other people, vehicles for numerous individuals, and other items that did not benefit her husband. The defendant was sentenced in the Eastern District of Arkansas to 20 months’ incarceration, three years’ supervised release, and ordered to pay restitution of $143,000 after previously pleading guilty to misappropriation by a fiduciary.

The last investigation I’d like to highlight resulted in charges alleging that two defendants submitted fraudulent applications for CARES Act funds for several nonprofit religious organizations and related businesses. The defendants allegedly spent the funds on renovations of their various properties as well as on luxury items. The total loss to the government is approximately $3.5 million. The defendants were arrested after being charged in the District of Massachusetts with conspiracy to commit wire fraud and unlawful monetary transactions. This investigation was conducted by the VA OIG, FBI, and the Pandemic Response Accountability Committee Fraud Task Force.

Now on to the reports. The OIG published SIX reports in October, and I’d like to talk about two the of them.

The first has to do with the MISSION Act.

The Mission Act of 2018 is legislation meant to improve and modernize major parts of the VA. The Act requires the OIG to review VA’s data reporting website and make recommendations for improvement. The most recent report, published in October, is the fourth report from the OIG’s yearly review on the topic. The OIG assessed VA’s compliance with MISSION Act requirements for reporting staffing and vacancy data, as well as the clarity of related explanations, on its public-facing website.

The OIG made two recommendations: (1) request legislative relief for any data they cannot report or, this is the second, clearly explain the data limitations precluding VA from reporting all required elements of time-to-hire data.

The OIG will monitor implementation of planned actions and will close the recommendations when VA provides sufficient evidence of adequate progress addressing the issues identified.

The second report, titled Evaluation of Quality, Safety, and Value in Veterans Health Administration Facilities, Fiscal Year 2021, involved OIG unannounced inspections at 45 VHA medical facilities from November 30, 2020, through August 23, 2021.

The purpose of this report’s evaluation was to determine whether VHA facility senior managers complied with selected quality, safety, and value program requirements for committees with oversight functions, systems redesign and improvement, protected peer reviews of clinical care, and medical center surgical programs.

The results in this report are a snapshot of VHA performance at the time of the fiscal year 2021 OIG inspections and may help leaders identify vulnerable areas or conditions that, if properly addressed, could improve patient safety and healthcare quality.

The OIG found general compliance with many requirements but did issue three recommendations based on identified weaknesses.

The first recommendation is that the under secretary for health, in conjunction with Veterans Integrated Service Network, or VISN, directors and facility senior leaders, ensures that facility peer review committees recommend improvement actions for Level 3 peer reviews.

The second recommendation is to make certain that facility surgical work groups meet monthly and core members consistently attend meetings.

And the final recommendation is to ensure that facility surgical work groups consistently review surgical deaths.

For more information about these reports, and all the reports that the VA OIG published in October, head to our website at va.gov/oig. Click on reports under the publications tab.

That’s it for this episode of Veteran Oversight Now. I encourage you to check out other episodes wherever you listen to podcasts. I’m your host, Austin Fox. 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.
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