Federal Reports

Our audit objective was to assess GAO’s compliance with Federal Information Security Management Act of 2002 (FISMA) requirements.Due to the sensitive nature of our findings, a full report on the results of our audit was prepared for internal GAO use only.

The VA Office of Inspector General (OIG) reviewed reexamination requests by the Veterans Benefits Administration (VBA) and estimated that, from March through August 2017, VBA spent $10.1 million on unwarranted reexaminations. The OIG estimated that VBA would waste an additional $100.6 million over the next five years unless it ensures that VBA employees only request reexaminations when necessary.According to VBA policy, employees can request reexaminations for veterans when there is a need to verify the continued existence or current severity of a disability, and when there is no exclusion from reexamination. However, before requesting a medical reexamination, VBA policy requires a Rating Veterans Service Representative to review the veteran’s claims folder and determine whether the reexamination is needed. This pre-exam review serves as an internal control to prevent unwarranted reexaminations. The OIG estimated that 15,500 of 19,800 unwarranted reexaminations (78 percent) lacked a pre-exam review, indicating that VBA management routinely bypassed this internal control. Instead, VA Regional Office managers routed these cases directly to a Veterans Service Representative for scheduling the reexamination. Bypassing the pre-exam review caused the unwarranted reexaminations. About 14,200 veterans saw no change to their disability evaluations as a result of these reexaminations. The OIG estimated that the reexaminations resulted in proposed benefit reductions for about 3,700 veterans. Unwarranted reexaminations also created unnecessary work for VA employees by reducing VBA’s capacity to process benefits claims and the Veterans Health Administration’s capacity to provide healthcare services.The OIG made four recommendations including establishing internal controls to ensure that a reexamination is necessary, prioritizing the design and implementation of system automation to minimize unwarranted reexaminations, enhancing VBA’s quality assurance reviews of requested reexaminations, and conducting a focused quality improvement review of cases with unwarranted reexaminations to understand and redress the causes of avoidable errors.

The VA Office of Inspector General (OIG) substantiated an allegation that purchase cardholders at the VA St. Louis Health Care System (System) split purchases to install fire stops (building and fire protection features designed to minimize the effects of fire, smoke, and heat) at its facilities. The OIG found that out of 268 purchases made with a vendor in 2014 and 2015, purchase cardholders made 25 split purchases for the installation of fire stops valued at about $61,000. The OIG identified an additional 153 split purchases made with the same vendor for unrelated construction work valued at approximately $364,000. The OIG found that 211 of the 268 purchases also exceeded the $2,000 micro-purchase threshold for construction acquisitions. Of the 211 purchases that exceeded the micro-purchase threshold, 154 transactions were also split purchases. The value of the remaining 57 purchases exceeding the micro-purchase was approximately $139,000. In total, the OIG identified 235 purchases valued at about $564,000 that were unauthorized commitments and improper payments. The Federal Acquisition Regulation (FAR) requires project leaders to obtain competitive bids for purchases over a certain amount, but employees were following guidance from the System’s Accounting Department that was in direct conflict with FAR requirements and annual purchase card training. Because of these conflicts, System cardholders and approving officials did not have a clear understanding of what represented a split purchase. The OIG made three recommendations, including submitting ratification requests for the improper purchases, providing additional training on how to avoid split purchases and comply with micro-purchase thresholds, and establishing a rigorous monitoring mechanism to identify and prevent improper purchase card transactions.

The U.S. Postal Service operates one of the largest vehicle fleets in the U.S. In fiscal year (FY) 2017, the Postal Service used 205,997 vehicles, primarily to deliver and collect mail. Each of these Postal owned vehicles are issued a fleet card to pay for commercially purchased fuel, oil, and maintenance expenses up to $300. In addition to these cards, the Postal Service has fleet specialty cards. Fleet specialty cards are issued to each facility with assigned vehicles and to Vehicle Maintenance Facilities (VMF) to pay for maintenance or repairs over $300. The objective of our audit was to assess the effectiveness of controls over fleet specialty cards for delivery operations in the Pacific Area.

First Coast Service Options, Inc., did not claim $1.06 million of allowable Medicare Supplement Executive Retirement Plan costs for calendar years 2008 through 2010.

First Coast Service Options, Inc., claimed $43,835 of unallowable Medicare pension costs for calendar years 2008 through 2010.