PAST AND PRESENT EFFORTS TO IDENTIFY AND ELIMINATE FRAUD, WASTE, ABUSE, AND MIS- MANAGEMENT IN PROGRAMS ADMINISTERED BY THE DEPARTMENT OF VETERANS AFFAIRS HEARINGS BEFORE THE COMMITTEE ON VETERANS’ AFFAIRS HOUSE OF REPRESENTATIVES ONE HUNDRED EIGHT CONGRESS FIRST SESSION MAY 8 AND JUNE 10, 2003 Printed for the use of the Committee on Veterans’ Affairs Serial No. 108–13 ( U.S. GOVERNMENT PRINTING OFFICE 93–887PDF WASHINGTON : 2004 For sale by the Superintendent of Documents, U.S. Government Printing Office Internet: bookstore.gpo.gov Phone: toll free (866) 512–1800; DC area (202) 512–1800 Fax: (202) 512–2250 Mail: Stop SSOP, Washington, DC 20402–0001 COMMITTEE ON VETERANS’ AFFAIRS CHRISTOPHER H. SMITH, New Jersey, Chairman MICHAEL BILIRAKIS, Florida LANE EVANS, Illinois TERRY EVERETT, Alabama BOB FILNER, California STEPHEN E. BUYER, Indiana LUIS V. GUTIERREZ, Illinois JACK QUINN, New York CORRINE BROWN, Florida CLIFF STEARNS, Florida VIC SNYDER, Arkansas JERRY MORAN, Kansas CIRO D. RODRIGUEZ, Texas RICHARD H. BAKER, Louisiana MICHAEL H. MICHAUD, Maine ROB SIMMONS, Connecticut DARLENE HOOLEY, Oregon HENRY E. BROWN, JR., South Carolina SILVESTRE REYES, Texas JEFF MILLER, Florida TED STRICKLAND, Ohio JOHN BOOZMAN, Arkansas SHELLEY BERKLEY, Nevada JEB BRADLEY, New Hampshire TOM UDALL, New Mexico BOB BEAUPREZ, Colorado SUSAN A. DAVIS, California GINNY BROWN-WAITE, Florida TIM RYAN, Ohio RICK RENZI, Arizona TIM MURPHY, Pennsylvania PATRICK E. RYAN, Chief Counsel and Staff Director (II) C O N T E N T S May 8, 2003 Page Past and Present Efforts to Identify and Eliminate Fraud, Waste, Abuse, and Mismanagement in Programs Administered by the Department of Vet- erans Affairs ......................................................................................................... 1 OPENING STATEMENTS Chairman Smith ...................................................................................................... 1 Prepared statement of Chairman Smith ........................................................ 105 Hon. Lane Evans, ranking democratic member, Committee on Veterans’ Affairs .................................................................................................................... 3 Prepared statement of Congressman Evans .................................................. 106 Hon. Henry E. Brown, prepared statement of ...................................................... 107 Hon. Darlene Hooley ............................................................................................... 15 Prepared statement of Congresswoman Hooley ............................................. 107 Hon. Steve Buyer ..................................................................................................... 15 Hon. Vic Snyder ....................................................................................................... 17 Hon. Michael Bilirakis ............................................................................................ 19 Hon. Michael H. Michaud ....................................................................................... 21 Hon. Rob Simmons .................................................................................................. 23 Hon. Rick Renzi ....................................................................................................... 25 Hon. Tom Udall ....................................................................................................... 26 Prepared statement of Congressman Udall ................................................... 108 Hon. Ginny Brown-Waite ........................................................................................ 29 Hon. Shelley Berkley ............................................................................................... 31 Prepared statement of Congresswoman Berkley ........................................... 116 WITNESSES Bascetta, Cynthia A., Director, Health Care, Veterans’ Health and Benefits Issues, U.S. General Accounting Office; accompanied by Paul Reynolds, Assistant Director, Healthcare, U.S. General Accounting Office; and Irene Chu, Assistant Director, Education, Workforce and Income Security, U.S. General Accounting Office ................................................................................... 9 Prepared statement of Ms. Bascetta ............................................................... 150 Griffin, Hon. Richard J., Inspector General, Department of Veterans Affairs, accompanied by Michael Slachta, Jr., Assistant Inspector General for Audit- ing, Department of Veterans Affairs .................................................................. 5 Prepared statement of Mr. Griffin .................................................................. 117 June 10, 2003 Past and Present Efforts to Identify and Eliminate Fraud, Waste, Abuse, and Mismanagement in Programs Administered by the Department of Vet- erans Affairs ......................................................................................................... 45 OPENING STATEMENTS Chairman Smith ...................................................................................................... 45 Prepared statement of Chairman Smith ........................................................ 220 Hon. Lane Evans, ranking democratic member, Committee on Veterans’ Affairs .................................................................................................................... 47 (III) IV Page Hon. Lane Evans, ranking democratic member, Committee on Veterans’ Affairs—Continued Prepared statement of Congressman Evans .................................................. 225 Hon. Michael Bilirakis ............................................................................................ 53 Hon. Michael H. Michaud ....................................................................................... 62 Hon. Bob Beauprez .................................................................................................. 68 Hon. Vic Snyder ....................................................................................................... 70 Hon. Rick Renzi ....................................................................................................... 72 Hon. Tim Murphy .................................................................................................... 73 Hon. Tom Udall ....................................................................................................... 76 Hon. Jeff Miller ........................................................................................................ 77 Hon. Ciro D. Rodriguez ........................................................................................... 79 Hon. Steve Buyer ..................................................................................................... 81 Hon. Ted Strickland ................................................................................................ 86 Hon. Ginny Brown-Waite ........................................................................................ 87 Hon. Darlene Hooley ............................................................................................... 89 Hon. Tim Ryan ......................................................................................................... 91 WITNESSES Mackay, Jr., Leo S., Deputy Secretary, Department of Veterans Affairs; ac- companied by Robert H. Roswell, M.D., Under Secretary for Health, Depart- ment of Veterans Affairs; Daniel L. Cooper, USN (ret.), Under Secretary for Benefits, Department of Veterans Affairs; and William H. Campbell, Assistant Secretary for Management, Department of Veterans Affairs .......... 54 Prepared statement of Dr. Mackay ................................................................. 228 MATERIAL SUBMITTED FOR THE RECORD Additional information submitted for the record: Attachment A: Comparison of the Assumptions and Costs for Allen v. Principi Decision Prepared by VA and the Congressional Budget Office (CBO), revised June 10, 2003, submitted by Admiral Dan Cooper, Under Secretary for Benefits ....................................................................... 64 Attachment B: Summary of National Acquisition Strategy Prepared: June 10, 2003, submitted by Admiral Dan Cooper, Under Secretary for Benefits .......................................................................................................... 83 ‘‘VA’s Comments on Items of Concern Identified in Inspector General Griffin’s Statement May 8, 2003 before the House Committee on Veter- ans Affairs,’’ submitted by Department of Veterans Affairs ..................... 181 Correspondence: ‘‘Recommendations and Comments,’’ re oversight of nursing homes by VHA, submitted by Department of Veterans’ Affairs ................................ 34 ‘‘Office of Inspector General, Department of Veterans Affairs, 2004 fund- ing need,’’ re adequacy of the IG budget, submitted by Department of Veterans Affairs ........................................................................................ 37 Letter from Secretary Principi to Congressman Evans dated May 2, 2003 109 Letter from Office of Management and Budget to Congressman Evans dated May 14, 2003 ....................................................................................... 49 Letter from Department of Health and Human Services to Congressman Tom Udall dated January 30, 2003 ............................................................. 113 Letter to Hon. Tommy G. Thompson, Secretary of