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VA contracting at ‘high risk’ for wasting tax dollars

Airman Katherine Morton, left, and Staff Sgt. Oscar Urquidi, both contract specialists assigned to the 6th Contracting Squadron, review a new contract at MacDill Air Force Base, Fla., Feb. 23, 2017. Contracts at MacDill can take anywhere from 60 days to four years to complete, depending on the dollar amount of the project. (U.S. Air Force photo by Airman 1st Class Adam R. Shanks)

The Government Accountability Office on Wednesday declared Department of Veterans Affairs contracting, which topped $26 billion in 2017, is a “high risk” area of government, susceptible to waste and mismanagement of taxpayer money and in need of more oversight.

The GAO, a leading government watchdog agency, presented a biennial report to the House Committee on Oversight and Reform on government programs that are vulnerable to fraud, waste, abuse and mismanagement. After a government-wide review, the GAO added two new areas to its latest report, one of them being VA contracting.

The VA spent $26 billion in fiscal 2017 to contract for goods and services – one of the largest procurement budgets across the U.S. government, said Gene Dodaro, who leads the GAO. The watchdog found outdated acquisition policies, little oversight and an unreasonable workload on its contracting officers, among other risks.

“They have outdated policies and practices and haven’t been able to save a lot of money,” he told the oversight committee. “Many purchases are being made under emergency situations.”

Dodaro specifically brought attention to how the VA purchases medical supplies.

Contracting officers rushed orders of a large amount of medical supplies that could’ve been routinely purchased, he said. Those emergency purchases accounted for 20 percent of the Veteran Health Administration’s overall procurements in fiscal 2016, totaling nearly $2 billion, the GAO report states.

Other watchdog groups have recorded problems during the past two years with how the VA buys medical supplies.

According to documents released last year by the U.S. Office of Special Counsel, the VA hospital in Durham, N.C., spent more than $1.3 million on medical supplies that it didn’t need or use. The logistical problems there were analogous to issues the VA Office of Inspector General discovered in 2017 at the Washington DC VA Medical Center, where roughly $150 million in medical supplies were not inventoried.

The GAO began focusing its attention on VA contracting in 2015. Since then, the watchdog made 31 recommendations for the agency, 21 of which haven’t been implemented.

In addition, overall VA health care remained on the high-risk list this year. It’s been there since 2015, following the discovery of veterans suffering long waits for treatment at VA facilities.

Of the 35 areas of government on the list, seven made progress since 2017, Dodaro said. VA health care wasn’t one of them.

“Unfortunately, many of the areas haven’t really changed that much since our last update,” he said. “Veterans health care remains a problematic area.”

In its newest report, the GAO listed VA health care as one of nine areas that need special attention from Congress and the White House.

The agency cited a “lack of progress” and noted ongoing issues at the VA with accountability, information technology, staff training, ambiguous policies and cost efficiency.

Leadership instability at the agency was partially to blame for the problems, Dodaro said. Since VA health care was added to the list, the department has been led by three secretaries: Bob McDonald, David Shulkin and Robert Wilkie.

“So that shows you at the very top of the department how much turnover there’s been,” Dodaro said. “As a result of that, the VA — to this day — does not yet have a good plan for addressing fundamental causes of why we put them on the list. It’s prevented them from dealing with some very underlying management problems.”

Dodaro has met with Wilkie, the current secretary, and said he is hopeful Wilkie can make progress. Wilkie designated a team of people to work with GAO staff, Dodaro said.

Nikki Clowers, managing director of health care for the GAO, said vacancies among other top VA jobs have caused confusion and delays.

The agency is still without a permanent undersecretary of health – a position that’s gone unfilled since 2017. The job requires a presidential appointment and confirmation by the Senate. VA official Richard Stone has taken on those duties on a temporary basis.

“When you have those vacancies and not clear policies or clearly defined roles and responsibilities for those in acting positions, it can cause confusion,” Clowers said. “And we’ve seen that.”


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