Federal Reports

The VA Office of Inspector General (OIG) conducted a healthcare inspection of an allegation related to a patient who sought help with gastrointestinal symptoms at the Eastern Oklahoma VA Health Care System in Muskogee (facility) three times in 2020 and was allegedly sent away. The patient went to a non-VA hospital and was diagnosed with colorectal cancer in early 2021.The OIG did not substantiate that the patient was sent away three times. The OIG identified concerns related to the patient’s fecal immunochemical test (FIT), an Emergency Department physician’s patient assessment, and facility leaders’ response to the patient’s complaints and multiple Emergency Department physician complaints.The electronic health record contained no documented evidence that the FIT was mailed to or discussed with the patient, even when not returned.The Emergency Department physician did not adequately assess the patient by failing to perform a digital rectal examination when the patient’s clinical presentation included having blood in the stool.Facility staff did not adequately review and respond to the patient’s complaints. A primary care leader did not fully resolve complaints related to providers’ patient interactions and care. The patient advocate failed to address a complaint, document the involved providers, or contact the patient.The OIG found facility leaders initiated peer reviews and provided an institutional disclosure to the patient but identified leaders’ inadequate response to complaints about the Emergency Department physician. Beyond reporting and intermittent discussions with the provider, leaders took no further actions to address the physician’s performance concerns.The OIG made four recommendations to the Facility Director to ensure FITs are tracked, evaluate Emergency Department providers’ processes for examinations when patients present with gastrointestinal symptoms with bleeding, ensure thorough reviews and documentation of patient complaints, and ensure leaders monitor complaints related to the Emergency Department physician.

The OIG reviewed the reassignments of two executive directors in the Veterans Benefits Administration (VBA) to determine whether VA’s policies and procedures were followed when determining their eligibility for relocation allowances. The OIG found nothing improper with respect to the allowances paid to the two executive directors. The OIG observed, however, that there were inconsistencies in VA’s guidance regarding the approval of relocation allowances. Specifically, the policy guidance appears to have improperly applied criteria regarding relocation incentives rather than those for relocation allowances. These different payment options are defined in separate and distinct federal regulations and VA policy.The OIG issued a VA management advisory memorandum to share observations from its review. No additional steps are being taken at this time, including any further reporting on the examination of the two executive directors’ circumstances, as no wrongdoing or violation of law or policy was identified regarding the relocation allowances. The Office of Human Resources and Administration (HRA) will inform the OIG what action, if any, HRA takes to address the issues identified.

The OIG assessed the oversight and stewardship of funds and identified opportunities for cost efficiency at the Eastern Oklahoma VA Health Care System. The review focused on four areas:1. Open obligations. The team found that the system’s fiscal staff did not always review open obligations for goods and services to determine if they were still valid and necessary. This leaves the system vulnerable to the risk that funds will be not used in the year they were appropriated, as required. In addition, some end dates for contracts’ period of performance were not accurate.2. Purchase card use. The system did not always maintain supporting documentation for transactions, conduct quarterly audits of the purchase card program on time, and consider contracts instead of purchase cards for ongoing, repetitive orders of goods or services.3. Administrative staffing and labor costs. The system had higher administrative staff levels than similar facilities, but system leaders have taken several actions to strengthen oversight of this area. (A difference in the number of personnel should be a starting point for deeper examination and is not a determining factor by itself.) The OIG also found that staff reviewed salary cost data as required to ensure labor costs were recorded correctly.4. Pharmacy operations and cost-savings efforts. The system could improve pharmacy efficiency by narrowing the gap between the facility’s observed and expected drug costs, increasing the rate that inventory is used to reduce storage costs, and following the required process for buying drugs not included in VA’s national formulary listing.The OIG made nine recommendations for improving cost efficiency. The number of recommendations should not be used, however, to gauge the system’s overall financial health. The intent is for system leaders to use these recommendations as a road map for improvement in the areas reviewed.

The Veterans Benefits Administration (VBA) compensation program provides monthly tax-free, service-connected benefits to veterans as compensation for the effects of disabilities caused by diseases or injuries incurred or aggravated during active military service. Special monthly compensation (SMC) recognizes the severity of certain disabilities or combinations of disabilities by paying additional benefits, such as housebound entitlement. In a September 2016 report, the VA Office of Inspector General (OIG) found that VBA incorrectly processed about 27 percent of high-risk cases for veterans receiving compensation at the housebound rate.The OIG conducted this review to determine whether VBA effectively implemented the recommendations from the 2016 OIG report and found that VBA has not improved the accuracy of processing high-risk SMC housebound cases that were active as of September 24, 2020. In fact, VBA continues to have an estimated 27 percent error rate, resulting in about $165 million in improper payments. This occurred, in part, because VBA leaders did not establish adequate governance to effectively implement the OIG’s September 2016 recommendations and failed to make system-level changes to improve the accuracy of the claims process. Without improvements in oversight, accountability, monitoring, and the information system, VBA risks continuing to make improper payments, potentially wasting taxpayer dollars and subjecting veterans to undue financial hardship if overpayments must be repaid.The OIG made six recommendations. The acting under secretary for benefits should review all active high-risk SMC housebound cases and conduct ongoing periodic reviews, update and monitor SMC housebound training, ensure system enhancements are created and cannot be bypassed, and correct all processing errors identified by the review team and report the results to the OIG.

The OIG examined whether VA has an effective governance structure for ensuring deceased veterans whose remains are unclaimed are interred with dignity in a final resting place, such as burial in a national cemetery. The review was initiated in response to reports that deceased veterans’ unclaimed remains were being kept in a funeral home’s storage for decades, and may be indicative of a nationwide problem. VA is required by law to ensure that deceased veterans without next of kin receive these burials. Yet, the responsibility for providing related benefits and services is dispersed among VA’s three administrations.The review team found ineffective governance in three key areas:• VA missed opportunities to collaborate with entities that tracked unclaimed remains to help identify deceased veterans or engage funeral homes and others to locate them. The review team identified more than 400 probable veterans with records in a Department of Justice database of unclaimed deceased persons. The team also noted 1,700 cases in which VA confirmed that veterans in an external database were eligible for burials, but could not demonstrate they had been interred.• The department could not identify potential fraud or duplicate payments for burial benefits and services because payments cannot be reconciled across administrations that can reimburse for similar services (for example, two administrations could reimburse the costs of transportation for interment at a national cemetery).• Oversight was hampered by the lack of a single VA office or executive responsible for coordinating approximately 27 offices that provide some benefits and services for these veterans.The result is the lack of an accurate count of veterans whose remains are unclaimed and the risk that those left unidentified could be placed in mass graves or stored for years unnoticed.VA concurred with the OIG’s 11 recommendations to address the issues identified.

The NCUA Office of Inspector General contracted with Moss Adams LLP to conduct a Material Loss Review of Indianapolis’ Newspaper Federal Credit Union, a federally insured credit union. We reviewed the Credit Union to: (1) determine the cause(s) of the Credit Union’s failure and the resulting estimated $2.29 million loss to the Share Insurance Fund, (2) assess the NCUA’s supervision of the Credit Union, including implementation of the prompt corrective action requirements of Section 216 of the Federal Credit Union Act, and (3) provide appropriate observations and/or recommendations to prevent future losses.