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Steve Bracci, director of the claims and medical exams inspection division, discusses the report, Contract Medical Exam Program Limitations Put Veterans at Risk for Inaccurate Claims Decisions, with host Fred Baker. Plus highlights of the OIG's recent oversight work.
Veteran Oversight Now is an official podcast of the Department of Veteran Affairs, Office of Inspector General. Each episode features interviews with key stakeholders, discussions on high-impact reports, and highlights of recent oversight work. Listen regularly for the inside story on how the VA OIG investigates crimes and wrongdoings, audits programs that provide benefits and services to veterans, and inspects medical facilities to ensure our nation’s veterans receive safe and timely health care.
Fred Baker:
Welcome back to another podcast episode of Veteran Oversight Now, the official podcast of the VA Office of Inspector General. I’m your host Fred Baker.
Each month on this podcast we’ll bring you highlights of the VA OIG's recent oversight activities and interview key stakeholders in the office’s critical work for veterans.
Joining us today is Steve Bracci. Steve is the division director of the claims and medical exams inspection division. He has three managers, 14 benefits inspectors in various locations around the country. Welcome, Steve.
Steve Bracci:
Thanks Fred.
Fred Baker:
Steve, your office just recently released the report Contract Medical Exam Program Limitations Put Veterans at Risk for Inaccurate Claims Decisions. So, I want to talk a little bit about that and our findings. But first I want to talk a little bit about you. Give us a little idea of who you are or where you live, your family, and any hobbies.
Steve Bracci
Sure, I have been working with the OG for almost 21 years. I started right after 9/11. I started as an auditor in the Bedford audit division, and in January of 2017 my family and I moved out to Colorado to start up the new claims and medical exams division for the OIG’s Office of Audits and Evaluations.
Out here in Colorado, we enjoy all the outdoor activities that the state has to offer. We ski, hike, we go camping, and we ride ATVs. We really take advantage of all the state has to offer out here.
Fred Baker:
Great. And how did you come to the VA IG? You said you joined just after 9/11. What brought you to the VA Office of Inspector General?
Steve Bracci:
That's an interesting story. It's kind of a family business because prior to me starting with the OG about five years before that, my father retired from the OG, the VAOIG. He was a senior auditor, so I followed in his footsteps.
Fred Baker
Wow, that's interesting. So, growing up, when you're 12 years old, you're like, whoa, I want to be a senior auditor?
Steve Bracci:
Not exactly. I went to college, and I wanted to own a hotel or a restaurant. It was a bit of a career change, but I did see the benefit of working for the OIG from my father's experience.
Fred Baker:
Sure. And did you have other jobs prior to this one?
Steve Bracci:
I pretty much started with the OIG right out of college. I did some part time jobs to help put myself through college, but this is my first career job right out of college.
Fred Baker:
Sure. And you mentioned a family.
Steve Bracci:
Yeah, I'm married. I have my wife, Heidi, and we have five children ranging from age 11, all the way up to 30.
Fred Baker:
Wow. So, you're not busy at all?
Steve Bracci:
No, not at all.
Fred Baker:
Great. Alright, Steve, let's jump into the report and talk a little bit about what you did, how you did it, and what you found.
Steve Bracci:
Sure.
Fred Baker:
Do me a favor for this and kind of set the stage because some people don't understand how we select what our topics are for reports and how we go about that. Kind of set the stage kind—why did you decide to look at this area, maybe even include just a little bit about the office you run right. That might help explain the focus. And then talk about how you decided to look into this area and what the approach was.
Steve Bracci:
Sure. Our office conducts independent oversight of the Veterans Benefits Administration. We have a couple of main focus areas that we look at. Disability medical exams is the main one. We also look at VBA's quality assurance processes. We've done a lot of work in that area in the last couple of years, and we look at specialized disability compensation claims processing. So, an example of that is we've done two projects on military sexual trauma that have been pretty high profile and made some improvements for veterans. As far as selecting projects, we just look at areas that are high risk and impact veterans the most, and medical exams is certainly one of those areas.
Fred Baker:
And why is that?
Steve Bracci:
Medical exams are important because they provide evidence that support veterans’ claims for disability compensation benefits. They help determine the severity of each veteran's disabilities related to their military service. That, to me, is why they're most important. In addition to that, contract medical exams represent a significant investment to the VA. I'm VBA currently has 14 contracts with three vendors. And VA has spent nearly $6.8 billion on contract exams since the contracts were awarded in the beginning of fiscal year 2017.
Fred Baker:
So, not only does it mean a lot to the taxpayer in terms of proper spending, but this could amount to thousands of dollars annually for veterans with respect to their benefits, correct.
Steve Bracci:
Absolutely.
Fred Baker:
So this report is really about ensuring that the veterans receive the highest quality medicals exam possible, correct?
Steve Bracci:
That's right, High quality medical exams translate to more accurate and timely claims decisions for veterans.
Fred Baker:
And what is an inaccurate claim decision? You talked a little bit about why it's important to get it right, and but kind of expand on what happens if it's not accurate.
Steve Bracci:
Sure. An inaccurate claim decision is a decision that was made based on incomplete or inaccurate evidence. So, in this case, if an exam is not accurate or of high quality, then it can lead to an incorrect decision. Incorrect decisions can also be made based on human error. That happens if a claims processor misses something or just makes a mistake. If a claim is not accurate, the veteran doesn't receive the benefits and services they've earned and are entitled to, and that's very important. It can also lead to an increase in appeals as well as unnecessary rework and ultimately a waste of taxpayer money if the exam or work has to be redone.
Fred Baker:
So again, costs both the VA and the veteran in the end.
Steve Bracci:
Absolutely.
Fred Baker:
Can you provide kind of a scenario what veterans go through as they apply for the benefits specific to the medical exam and when a medical exam might be requested?
Steve Bracci:
Sure. So, a veteran submits a claim to the VA. This can be done online. It can be done through a veteran service organization, or it can be done on paper. It can be mailed in.
When a complete application comes in, a claims processor reviews the documentation and requests additional records, such as service treatment records, military personnel records, private treatment records, things of that nature. At that point, a claims processor can also request a medical exam and that will show the current condition and the severity of that. Once all evidence is received, a claims processor reviews the evidence and makes a decision on the veteran’s claim.
Fred Baker:
You mentioned measuring quality or looking at the quality of the exam and the accuracy. What did you look at in order to conduct this review and how long did it take?
Steve Bracci:
Sure, this was a very comprehensive review. The review period was January 1st through December 31st of 2020. This was the most current data available at the time of our field work. We focused on the actions and the decisions taken by VBA's Medical Disability Examination Office, also known as MDEO. This is the main program office within VBA that administers and overseas the Disability exam program.
As far as what we did, we reviewed policies, procedures and we looked at the quality review process that was in place within MDEO To take that a step further, we looked at a sample of almost 200 quality reviews that were completed by MDEO to assess that process, and we reviewed contract documentation because that's such a big part of this. Lastly, we interviewed managers and employees associated with the contracts and with the contract exam process. So, like I said, it was very comprehensive review.
Fred Baker:
So, a lot goes into this. How long does it take? How long did it take for this review from start to publication?
Steve Bracci:
It took over a year. I mean, it was very comprehensive between doing the field work, and then once we gathered all the information, conducting our analysis and writing our report and also going through our own quality assurance process that we have to make sure that what we publish is accurate and understandable.
Fred Baker:
So, Steve, when I read the findings, I found them a little conflicting. On one hand, we say they need better governance to improve and that all three vendors lacked providing some accurate exams. But then we say that the MDEO performed quality reviews correctly 95% of the time. Can you explain what the findings were and what they mean?
Steve Bracci:
Yeah, that's a great question, Fred. Let me see if I can clear that up. Like I said, our benefits inspectors reviewed almost 200 of the quality reviews that were completed by MDEO. The actual reviews they completed were correct. We looked at about 100 where MDEO identified errors and then 100 where they didn't identify errors, and our benefits inspectors came to the conclusion that those reviews were actually accurate. So, they did a good job with that.
Where we saw the problem was after that, after the reviews were completed. Based on the quality reviews, each vendor is given an accuracy score, and what we found is that MDEO reported that the three vendors have been consistently below the 92% accuracy requirement since at least 2017. And MDEO did not use monetary disincentives that are allowed in the contract to hold vendors accountable for that. So that's the issue that we saw there. As far as governance . . .
Fred Baker:
Steve, before we go on, explain that a little bit. Using monetary disincentives—what does that mean?
Bracci, Steve (OIG)
Sure. So written into the contract there are monetary incentives and disincentives to promote accurate exams. If vendors fail in any areas when it comes to accuracy of exams, timeliness of exams, or customer satisfaction, then VA has the option of applying a monetary disincentive and penalizing them for not meeting the standard. And we found that, in this case, they did not do that. They've never done that.
Fred Baker:
Right. So, the vendors were not meeting the quality standard, but then VA was doing nothing to help ensure that they would bring it back up to standard. They were just continuing along. Is that correct?
Steve Bracci:
At least in that they weren't using the monetary disincentives to do so. Correct.
Fred Baker:
Got you. Perfect. OK, so go ahead.
Steve Bracci:
As far as governance goes, in addition to MDEO, VBA has two other major program offices involved with contract exams. The Compensation Service develops and provides procedures, guidance, quality assurance and training. The Office of Field Operations is responsible for management and staff at VBA’s district and regional offices. So, the Office of Field Operations overseas the claims processors out in the field. We found that the governance structure is disjointed and required better coordination, communication, and monitoring.
Fred Baker:
So, there were two parts of the findings that I wanted you to expand on. One was “wording and exam contracts limited VBA's ability to hold vendors accountable.” And then you said that the MDEO has not consistently shared errors or used available information to improve quality.
Steve Bracci:
Sure. As far as the first issue goes, like I previously touched on, according to the contracts that were in place at the time of our review, vendors can receive monetary incentives or disincentives based on their performance in three categories, quality, timeliness, and veteran satisfaction. The contract wording, which MDEO developed with a prior contracting officer, detailed how to imply the monetary incentives to encourage continuous improvement by vendors, but the contract wording was not as specific and clear for applying the monetary disincentives.
We interviewed the current VA contracting officer. The contracting officer did say that the vendors were never awarded incentives or penalized for poor performance because the contract language was too subjective to calculate disincentive amounts and that wording needed to be changed. So that's the first issue that we found.
As far as the second issue, MDEO has not consistently shared errors or used available information to improve quality. This goes to the governance issue that I mentioned briefly. MDEO conducts quality reviews of the completed exams but does not routinely share errors for those reviews with the Office of Field Operations, and the Office of Field of Operations, like I said, they oversee the claims processors in the field. And this is important because a decision on a veteran’s claim can be updated anytime, even after it's made, if new evidence is provided. So that's important to veterans for sure.
Like I said, compensation service also had a piece in this. They have a multifaceted quality assurance program and part of that does look at—exams are covered in that quality assurance process. MDEO did not use readily available information from Compensation Services quality reviews to drive improvement.
Fred Baker:
So, Steve, what were our recommendations? And how would implementing them reduce the risk of an inaccurate claim?
Steve Bracci:
We made four recommendations to the acting under secretary for benefits and they were all aimed at improving VBA's processes, governance, and accountability, and ultimately improving the quality of completed exams. The first two had to do with modifying the contracts to allow VBA to better hold vendors accountable, and then the third and the fourth had to do with improving the governance issues between MDEO and the other offices within VBA.
If VBA implements the recommendations fully, it should result in better quality exams, which ultimately support more accurate and timely claims decisions for veterans.
Fred Baker:
And how did VA respond to the recommendations?
Steve Bracci:
VBA generally agreed with our recommendations. The acting under secretary concurred in principle with recommendations one and two, and provided actions taken to address those recommendations, which were revised contracts. VBA requested closure of those recommendations, but we took a look at what they provided, and we still have some concerns that the changes to the contract may not address or fully address the issues that we identified. So, we're going to take a more detailed look at those contracts and the actions taken in our follow-up process. As far as recommendations three and four go, the acting under secretary concurred with those and provided action plans to address both of them, and we will monitor VBA’s implementations of all four recommendations as part of our follow-up process.
Fred Baker:
You mentioned the follow-up process. What are the next steps? What happens after this report is released?
Steve Bracci:
About 90 days after the final report is published, we reach out to the department and start that follow-up process. We ask for a status update on all recommendations and any supporting documentation and evidence they can provide. We ask whether or not they request closure of the recommendations or if they are continuing to take actions. And then part of our follow up process is to review all of that evidence, All of that documentation. We reach out to the department sometimes for clarification to make sure we fully understand what they have taken. If they request closure of the recommendation and we feel confident that the actions taken address the intent of our recommendations, then we will close them/ For those that are not closed, we reach out every 90 days for a status update, so it's quarterly.
Fred Baker:
Great. Steve, is there anything I'm missing? Any big, big points?
Steve Bracci:
No, I think you covered it all, and I appreciate the opportunity to talk to you about this work.
Fred Baker:
Right. Well, again, we're talking with Steve Bracci, the division director of the claims and medical exams, inspection division here at the VA Office of Inspection Inspector General. Steve, thank you very much.
Steve Bracci:
Thanks Fred.
Fred Baker:
And now I'll turn it over to Adam Roy for this month highlights. Take it, Adam.
Adam Roy:
Thanks, Fred.
Now I’ll highlight some of the work the VA OIG did in May 2022.
I’m happy to announce that we published the latest Semiannual Report to Congress, which summarizes the results of VA OIG’s oversight work from October 1, 2021, to March 31, 2022. During this reporting period, the OIG identified nearly $4.1 billion in monetary impact for a return on investment of $41 for every dollar spent on oversight. We issued 143 reports and publications on VA’s programs and operations, made 397 recommendations, and conducted investigations that led to 104 arrests. As Inspector General Michael Missal said in his video introducing the SAR, which is available to view on our website, this report shows the OIG’s impact in helping VA improve the benefits and services that they provide to veterans, their families, and caregivers.
I also recently spoke with Inspector General Missal about the Semiannual Report to Congress on the recent episode of Veteran Oversight Now, our official podcast. Go to our podcast page on our web site to listen to it. Also, to read the full report, go to publications section of our website at va.gov/oig.
Turning now to some recent congressional testimony, Mr. Missal testified before the Senate Veterans’ Affairs Committee on May 11. This testimony focused on the challenges that VA faces in providing quality care to patients. He discussed VA’s actions related to OIG’s recommendations and how it would be helpful if other facilities reviewed OIG reports to see if their facilities may be facing similar issues.
Dr. Julie Kroviak, our deputy assistant inspector general for healthcare inspections, also attended the hearing. Both Mr. Missal and Dr. Kroviak responded to questions about OIG reports and findings related to facility leadership.
You can find this written testimony on our website under the media tab. And we’ve included a link to the committee’s website in the monthly highlights if you’d like to watch a recording of the hearing.
Now for a few updates to investigations by our special agents.
A VA OIG investigation revealed that a former Phoenix VA Healthcare System employee stole property, including home furnishings, that Walmart had donated for use by homeless veterans. The defendant used a truck belonging to VA’s Voluntary Services to pick up donated items from a Walmart distribution center. Then on numerous occasions, the defendant placed those items in his personal storage lockers instead of taking the donations to VA facilities in Phoenix. The defendant was sentenced in the District of Arizona to 60 months of supervised probation and $95,000 in restitution to VA after previously pleading guilty to theft of government property.
Another investigation, conducted by VA OIG, Federal Bureau of Prisons, and the FBI, resulted in a charge alleging that an incarcerated veteran sent a communication to VA in which he threatened both VA employees and the employees of a nonprofit organization. The defendant allegedly was angered after receiving a notification from VA that his financial benefits would be reduced during his incarceration. The defendant was indicted in the District of Massachusetts for the interstate transmission of a threatening communication.
In another case, a benefits investigation revealed that a former VA-appointed fiduciary stole over $300,000 that was intended for use by 10 different veterans that he was appointed to represent. The defendant pleaded guilty in the District of South Carolina to theft of government funds.
and finally, as a result of another multiagency investigation, a nonprofit organization entered into a non-prosecution agreement in the Western District of Missouri to forfeit over $6.9 million to the US Treasury and to pay over $1 million in restitution to the state of Arkansas. This nonprofit organization contracted with VA to provide substance abuse counseling and housing services for veterans. And as a condition of this agreement, representatives of the nonprofit organization admitted that their former officers and employees conspired to embezzle funds and to bribe several elected state officials. The former officers and employees allegedly caused the nonprofit to obtain additional sources of revenue, including federal program funds, through political outreach that violated both law and public policy. From 2010 to 2016, the nonprofit had revenues of approximately $837 million, including $1.7 million contributed by VA. To date, nine defendants have been indicted, nine arrested, seven convicted, and two sentenced.
Read more about these cases and some of our other cases the VA OIG investigated in the May monthly highlights available on our website.
Now to some published reports we published in May.
In our continuing oversight of VA’s electronic health record modernization, the OIG participated in an audit lead by the Department of Defense examining whether interoperability will be achieved between DoD, VA, and external health care providers using the Cerner Millennium electronic health record, or EHR system. DoD and VA took some actions to achieve interoperability, but did not consistently migrate information into the system, develop device interfaces, or ensure users were granted access only to necessary information. This was partially due to the joint program office not developing a plan to achieve interoperability or actively managing the program. Report recommendations include reviewing the program office’s actions under its charter and applicable laws, and that the program office should also determine what information constitutes a complete system; implement a plan for migrating legacy patient information; create medical device interfaces to directly transfer health care information to the system; and implement a plan to modify system user roles to ensure access to only necessary information.
Five of the seven healthcare inspections we published in May focused on the care individual patients received at specific VA medical facilities across the country. I’ll highlight just one of them here.
In this inspection, the OIG evaluated the adequacy of a patient’s outpatient care prior to surgery and during preoperative and postoperative care. After surgery, the patient was admitted, suffered alcohol withdrawal and declining health, and died under hospice care. In the months prior to the patient’s surgery, primary care staff failed to provide sufficient care coordination and treatment. During the patient’s hospital stay, medical-surgical nurses did not consistently assess the patient’s alcohol withdrawal symptoms or administer medications according to the facility’s protocol or according to physician orders. In the report, the OIG made ten recommendations.
Also in May, we published six Comprehensive Healthcare Inspection Program reports covering VA facilities located in New York and New Jersey. These reports are one element of the OIG’s overall efforts to ensure that our veterans receive high-quality and timely VA healthcare services. The inspections are performed approximately every three years for each facility. The New York inspections focused on VA medical centers in Northport and Albany as well as the Finger Lakes and New York Harbor healthcare systems. Another report is on the VA New Jersey Health Care System in East Orange. Lastly, one report focused on evaluation of leadership performance and oversight by Veterans Integrated Service Network 2, which covers New York and parts of New Jersey.
And lastly, I want to highlight a VA OIG hotline case. As I explained in last month’s podcast episode, the OIG’s Hotline Complaint Center accepts complaints from VA employees and the general public concerning criminal activity, waste, abuse, and mismanagement of VA programs and operations. Some hotline complaints result in an inspection, an audit, or a review, and the findings are published in an OIG report. Whereas other hotline complaints are referred to the relevant VA facility for investigation.
A hotline complaint I’ll share today has to do with changes to the duress and emergency notification system at the Wichita VA Medical Center. The medical center conducted a review and found that a behavioral health provider’s duress alarm failed to alert VA Police when the provider hit the button nine times after a patient threatened suicide by gun in the provider’s office. Although the provider’s duress alarm failed, VA Police were called via phone and responded. When the police arrived, the patient had already left the premises. A welfare check was conducted, and the patient was found to be okay. The medical center has since begun transitioning to a more reliable emergency notification system that allows users to activate the duress alarm even when the user is not logged onto their computer.
That’s it for the May highlights. To read all of them, go to our website, va.gov/oig, and click on monthly highlights underneath the publications tab.
Thanks for tuning in, and I look forward to sharing more highlights next month.This has been an official podcast of the VA Office of Inspector General. Veteran Oversight Now is produced by the Office of Communications and Public Affairs and is available at va.gov/oig. Tune in monthly to hear how the VA OIG serves veterans, their families, and caregivers, through meaningful independent oversight. Check out the website for more on the VA OIG oversight mission, read current reports, and keep up to date on the latest criminal investigations. Report potential crimes related to VA; waste or mismanagement; potential violations of laws, rules, or regulations; or risks to patients, employees, or property to the OIG online or call the hotline at 1-800- 488-8244. If you are a veteran in crisis or concerned about one, call the Veterans Crisis Line at 1-800- 273-8255, press 1, and speak with a qualified responder now.