Logistics Program Deficiencies in Previous Reports

In past reports, GAO and VHA identified major deficiencies related to  VHA’s management of medical supply and equipment inventories and the  standardization of such items. VAMCs and Networks We Visited Have Partially Complied with New VHA Requirements to Address Deficiencies in Its Logistics Program

To address deficiencies in its logistics program, VHA issued new  requirements in 2011 mainly in three areas—management of medical  supplies and equipment in VAMCs’ inventories, the standardization of  these items, and the monitoring of VAMCs’ logistics programs. These  requirements, some of which apply to VAMCs and some of which apply to  networks, are designed to improve veterans’ safety and the cost-effective  use of resources. We found that the five VAMCs we visited and their  corresponding networks have partially complied with VHA’s new  requirements, as of December 2012. None of the VAMCs We Visited Fully Complied with Requirements for Managing Inventories

None of the VAMCs we visited fully complied with all of VHA’s new  requirements for managing inventories. One VAMC We Visited and Two Networks Have Fully Complied with VHA’s Standardization Requirements

One VAMC we visited and two networks fully complied with VHA’s new  standardization requirements, and the remaining four VAMCs and three  networks have partially complied. Four VAMCs We Visited and Three Networks Have Fully Complied with VHA’s Monitoring Requirements

Four of the five VAMCs we visited and three of the five corresponding  networks had fully complied with the new monitoring requirements at the  time of our visit. VHA Has Additional Efforts Underway to Further Improve Its Logistics Program, but They Face Uncertainty about Implementation

In addition to the new VAMC and network requirements, VHA has other  efforts underway that—according to officials—will further improve the  management and tracking of medical supplies and equipment in VAMC  inventories and the standardization of such items across VHA. Specifically, VHA is (1) developing a new inventory management system  that will replace VHA’s existing systems for managing medical supply and  equipment inventories, (2) developing a system for electronically tracking  the location of certain medical supplies and equipment in VAMCs, and   (3) establishing a program executive office that will provide logistics  support and manage the standardization of medical supplies and  equipment VHA-wide. However, there are uncertainties related to  implementation, funding, and operational issues that may impede their  success, if not appropriately addressed. System interoperability issues. Officials told us that efforts to hire additional staff are currently on  hold because VHA intends to evaluate the effectiveness of the new  program executive office before committing additional resources to it. However, because  VAMCs we visited and the associated networks have only partially  complied with these requirements, the potential risks to patient safety and  the inefficient use of resources remain. Recommendations for Executive Action

We recommend that the Secretary of Veterans Affairs direct the Under  Secretary for Health to take the following actions:  To assist VAMCs and networks in complying with VHA’s new logistics  requirements, and thereby help ensure patient safety and the cost- effective use of resources, determine appropriate resource levels for VAMC logistics programs  and provide training and best practices to VAMCs to help them ensure that logistics staff, rather than clinical department staff,  manage all medical supplies; ensure that all items that VAMCs purchase are captured on their  lists of approved medical supplies and RME; and enter all stock surgical and dental instruments into the appropriate  reinforce through communication the requirement that VAMCs  develop a formal process for reviewing and approving emergency  purchases of medical supplies and RME, develop a systematic method using available VHA data to assist  VAMCs in tracking compliance with national contracts and blanket  purchase agreements, and  issue guidance to VAMCs and networks regarding interpretation of the  Management Quality Assurance Service checklist and reinforce  through communication the requirement that VAMCs correct  deficiencies within 90 days after they were identified or request an  extension and that networks use the entire checklist when conducting  their reviews of VAMC logistics programs and complete their review  within the required time frame. With respect to its plans for addressing our recommendations, VA  described specific actions that VHA, networks, and VAMCs plan to take to  improve VAMCs’ and networks’ compliance with VHA’s logistics  requirements. Therefore, we concluded that  uncertainty existed with regard to the continued implementation of this  office.
Why GAO Did This Study

VHAs logistics program is responsible for the management of medical supplies and equipment in VAMCs inventories and the standardization of such items throughout VHA. Previous reports have pointed to deficiencies in VHAs logistics program.
GAO assessed (1) the extent to which VAMCs and networks have complied with new VHA requirements to remedy known deficiencies in its logistics program and (2) VHAs progress in enhancing its logistics program. GAO reviewed documents and interviewed officials to identify new requirements affecting VHAs logistics program. GAO then visited a nongeneralizable sample of five VAMCs and verified the extent to which the VAMCs and corresponding networks, which oversee VAMCs, were complying with VHAs new requirements. GAO also reviewed documentation of VHAs plans for funding, implementing, and evaluating efforts it is undertaking to enhance its logistics program, examined the extent to which VHA was on track to execute those plans, and assessed VHAs efforts against criteria in GAOs standards for internal control in the federal government.

What GAO Found

To address deficiencies in its logistics program, the Veterans Health Administration (VHA) issued new requirements in 2011 regarding the management of medical supplies and equipment in Veterans Affairs medical centers (VAMC) inventories, the standardization of these items, and the monitoring of VAMCs logistics programs. These requirements, some of which apply to VAMCs and some of which apply to networks, are designed to improve veterans safety and the cost-effective use of resources. GAO found that the five VAMCs GAO visited and their corresponding networks have partially complied with VHAs new requirements. Specifically, as of December 2012,
none of the VAMCs GAO visited fully complied with all of VHAs new requirements for managing inventories;
one VAMC GAO visited and two networks fully complied with VHAs new standardization requirements, and the remaining four VAMCs and three networks partially complied; and
four of the five VAMCs GAO visited and three of the five corresponding networks fully complied with the new monitoring requirements.
Because VAMCs GAO visited and the associated networks have only partially complied with these requirements, potential risks to patient safety and the inefficient use of resources remain.
In addition to the new VAMC and network requirements, VHA has other efforts underway thataccording to officialswill further improve the management and tracking of medical supplies and equipment in VAMC inventories and the standardization of such items across VHA. However, there are substantive uncertainties relating to implementation, funding, and operational issues that may impede their success, if not appropriately addressed. Specifically:
VHA is piloting a new inventory management system that is intended to replace VHAs existing systems for managing medical supply and equipment inventories. However, VHA has not fully funded the pilot, staffing resources to implement it at VAMCs are limited, and VHA has yet to resolve technical issues to ensure that this new system can interface with legacy systems. Furthermore, VHA has yet to develop criteria and collect corresponding data to evaluate the performance of the pilot.
VHA is also implementing a system for electronically tracking the location of certain medical supplies and equipment in VAMCs. However, there are uncertainties with respect to interoperability issues with other inventory management systems and resources to implement the system.
Lastly, VHA is establishing a program executive office that will provide logistics support and manage the standardization of medical supplies and equipment VHA-wide. However, the office has not been fully staffed and uncertainty exists about its continued implementation, because VHA's efforts to hire additional staff are on hold pending its evaluation of the effectiveness of this office.

What GAO Recommends

GAO recommends that VHA take steps to assist VAMCs and networks in complying with VHAs new logistics requirements and develop plans for implementing and evaluating the performance of its efforts to improve its logistics program, which address the concernssuch as system interoperability issuesGAO identified. VA concurred with GAOs recommendations and provided an action plan to address them.