Federal Reports

In line with the Veterans Health Care Act of 1992 (referred to in this report as the public law), the OIG conducts reviews to determine whether certain manufacturers (1) made all their covered drugs available at a discount to the government through a Federal Supply Schedule (FSS) contract and (2) correctly calculated and reported the drugs’ non-Federal Average Manufacturer Price (non-FAMP) on which the discount is based. The law helps ensure the government receives fair prices on pharmaceutical purchases. VA identifies covered drugs as those subject to the law that are commercially sold and approved by the Food and Drug Administration under a new drug application or biological licensing agreement. The reviews are not published because they contain sensitive commercial information.To promote transparency, this report summarizes the 15 reviews the OIG completed in FYs 2022 and 2023 to identify any instances of noncompliance with the public law. In conducting the individual reviews, the OIG teams evaluated non-FAMPs and related ceiling prices, late additions (items not placed on FSS contract within 75 days of being on the market), and failures to offer FSS-required price reductions that would have affected ceiling prices.Cumulatively, the OIG identified approximately $61.2 million in overcharges by manufacturers to the government. This amount includes approximately $27 million resulting from manufacturers’ noncompliance with the public law and about $34.1 million resulting from manufacturers’ violations of the price reduction clause in the FSS contract that were unrelated to the public law. VA has since collected approximately $59.3 million (about 97 percent) of the recommended amount from 11 of the 14 manufacturers. VA does not expect to collect overcharges from one manufacturer that filed for bankruptcy, and overcharges with two other manufacturers remained unresolved during the course of this review.

We found OSMRE was not adequately prepared to expend IIJA funds, and it continues to expend funds without effective processes in place.

To obtain further information about this Classified or Sensitive but Unclassified Report, please contact the OIG Office of Counsel atOIGCounsel@oig.treas.gov, (202) 927-0650, or by mail at Office of Treasury Inspector General, 1500 Pennsylvania Avenue, Washington DC 20005.

To obtain further information about this Classified or Sensitive but Unclassified Report, please contact the OIG Office of Counsel at OIGCounsel@oig.treas.gov, (202) 927-0650, or by mail at Office of Treasury Inspector General, 1500 Pennsylvania Avenue, Washington DC 20005.

The VA Office of Inspector General (OIG) conducted an annual risk assessment of VA’s three charge card programs, which cover purchase cards for supplies and services; travel cards for official travel expenses; and fleet cards for fuel, maintenance, and repair of government-owned and -operated vehicles. These programs had over $5.6 billion in spending from July 1, 2022, through June 30, 2023. The OIG conducted this risk assessment from August 2023 through January 2024. The team analyzed summary transaction data to assess charge card risk based on categories developed using data mining to identify potentially improper (including illegal and erroneous) charge card purchases. The team also reviewed VA policies, procedures, and other controls applicable to these charge card programs, as well as previously issued OIG reports and recommendations and results from OIG investigations of charge card misuse. Like the fiscal year 2020 assessment, the OIG concluded the Purchase Card Program is at medium risk of illegal, improper, or erroneous purchases. Data analysis, the volume and value of spending, and OIG investigations and reviews identified patterns of purchase card transactions that deviate from the Federal Acquisition Regulation and VA policies and procedures.In contrast, VA’s Travel and Fleet Card Programs have a low risk of illegal, improper, or erroneous purchases based on the data analysis and lack of related additional risk factors. The team reviewed travel card data from July 1, 2022, through June 30, 2023. During the scope of this review, over 21,000 VA travel cardholders initiated about 615,000 transactions totaling approximately $90 million. From July 1, 2022, through June 30, 2023, VA fleet cards were used for over 165,000 transactions totaling approximately $17.5 million.