1.) Internal and External Reviews of VHA Organizational Structure

Recent internal and external reviews of VHA operations have identified  deficiencies in VHA’s organizational structure and recommended changes  that require significant restructuring to address, including eliminating and  consolidating program offices and reducing VHA central office staff. In addition to the reviews required by the Choice Act, VHA initiated  internal task forces to examine organizational structure changes and  make recommendations. VHA Does Not Have a Process That Ensures Recommended Organizational Structure Changes Are Evaluated and Implemented

Despite several critical internal and external reviews, VHA does not have  a process that ensures that recommendations resulting from these  reviews are evaluated to determine appropriate actions and that any such  appropriate actions are implemented. The lack of such processes is inconsistent with federal  standards for internal control, which state that management should  remediate identified internal control deficiencies on a timely basis. We found instances where VHA task force actions in response to recent  recommendations for organizational structure changes were incomplete,  not documented, or not timely:  Governance task force. For example, the  Independent Assessment and the VHA governance task force  reports both noted that VHA central office programs and staff had  increased dramatically in recent years, resulting in a fragmented  and “silo-ed” organization without any discernible improvement in  business or health outcomes, and recommended restructuring and  downsizing VHA central office. The task force, made up of 18 senior  VA and VHA officials, conducted its work over about 6 months but  did not produce the detailed implementation plan of the  Independent Assessment recommendations it was chartered to  create, according to VHA officials. VHA also cannot ensure that it is making efficient  use of internal resources allocated to developing and implementing  recommendations. VHA Central Office Has Provided Little Monitoring and Did Not Anticipate Challenges for a Recent and Significant Organizational Structure Change, the VISN Realignment

The VISN realignment is a significant change to VHA’s organizational  structure; it is the first large-scale reorganization of VISN boundaries  since the VISNs were created in 1995. However, VISNs have been  implementing this change with little monitoring from VHA’s central office. In addition, VHA did not proactively identify and provide guidance to  address challenges VISNs and VAMCs have encountered. These actions  are inconsistent with federal standards for internal control concerning  monitoring and risk assessment. Specifically, these controls state that  management should establish monitoring activities, evaluate the results,  and remediate identified deficiencies in a timely manner. In  addition, these controls state management should identify, analyze, and  respond to changes that could affect the system. This involved decreasing the number of VISNs from 21 to 18  and reassigning some VAMCs to different VISNs. VHA chartered a task force—the VISN Realignment  Workgroup—to implement the realignment across the VISNs. “double-encumbered” positions. information technology. It can also help  inform future organizational structure changes by offering VHA the  opportunity to anticipate challenges and proactively provide guidance to  address them. In  addition, without adequate monitoring, including a plan for evaluation,  VHA cannot be certain it is effectively implementing the ongoing VISN  realignment. This process should include the  documentation of decisions and assigning officials or offices  responsibility for ensuring that approved recommendations are  implemented. 2. Conduct an evaluation of the implementation of the VISN realignment  to determine whether deficiencies exist that need corrective actions,  and apply lessons learned from the evaluation to future organizational  structure changes, such as possible changes to VISN staffing models  or actions to implement Commission on Care recommendations. In its comments, VA stated  that VHA plans to develop processes to ensure organizational structure  changes are evaluated and implemented appropriately and to evaluate  the implementation of the VISN realignment, with estimated completion  dates for the development of these processes by March 2017 and  September 2017, respectively. Appendix II: Department of Veterans Affairs’ (VA) MyVA Regions and the Veterans Health Administration’s (VHA) Veterans Integrated Service Network (VISN) Realignment

VA announced a major organizational initiative in September 2014 called  MyVA. 2.) The VISN realignment began in October  2015 and VHA officials anticipate it will be completed, at the earliest, by  the end of fiscal year 2018.
Why GAO Did This Study

GAO and others have expressed concerns about VHA's management of its health care system. In response, VA initiated a new regional framework to improve internal coordination and customer service, and VHA initiated an effort to realign its VISNs.
GAO was asked to review VHA's organizational structure—the operating units, processes, and other components used to achieve agency objectives. This report examines the extent to which (1) VHA has a process for evaluating recommended organizational structure changes to determine actions needed and implementing them as appropriate; and (2) VHA monitored and provided guidance for implementing the VISN realignment. GAO reviewed VHA documents, reviewed internal and external assessments of VHA, and interviewed officials from VHA central office and all VISNs. GAO evaluated VHA's actions against relevant federal standards for internal control.

What GAO Found

Recent internal and external reviews of Veterans Health Administration (VHA) operations have identified deficiencies in its organizational structure and recommended changes that would require significant restructuring to address, including eliminating and consolidating program offices and reducing VHA central office staff. However, VHA does not have a process that ensures recommended organizational structure changes are evaluated to determine appropriate actions and implemented. This is inconsistent with federal standards for internal control for monitoring, which state that management should remediate identified internal control deficiencies on a timely basis. GAO found instances where VHA actions in response to recent recommendations for organizational structure changes were incomplete, not documented, or not timely. For example, VHA chartered a task force to develop a detailed plan to implement selected recommendations from the independent assessment of VHA's operations required by the Veterans Access, Choice, and Accountability Act of 2014; according to VHA, the assessment cost $68 million. It found, among other things, that VHA central office programs and staff had increased dramatically in recent years, resulting in a fragmented and “silo-ed” organization without any discernible improvement in business or health outcomes. It recommended restructuring and downsizing VHA's central office. The task force of 18 senior Department of Veterans Affairs (VA) and VHA officials conducted work over about 6 months, but did not produce a documented implementation plan or initiate implementation of recommendations. Without a process that documents the assessment, approval, and implementation of organizational structure changes, VHA cannot ensure that it is making appropriate changes, using resources efficiently, holding officials accountable for taking action, and maintaining documentation of decisions made.
VHA central office's monitoring of the Veterans Integrated Service Networks (VISN) realignment—a recent and significant organizational structure change—has been limited, and the office has provided little implementation guidance. In October 2015, VHA began to implement a realignment of its VISN boundaries, which involves decreasing the number of VISNs from 21 to 18 and reassigning some VA medical centers (VAMC) to different VISNs. VHA officials anticipate this process will be completed by the end of fiscal year 2018. VHA officials on the task force implementing the realignment told GAO they thought VISNs could implement the realignment independently without the need for close monitoring. VHA also did not provide guidance to address VISN and VAMC challenges that could have been anticipated, including challenges with services and budgets, double-encumbered positions (two officials in the same position in merging VISNs), and information technology. Further, VHA officials said they do not have plans to evaluate the realignment. VHA's actions are inconsistent with federal internal control standards for monitoring (management should establish monitoring activities, evaluate results, and remediate identified deficiencies) and risk assessment (management should identify, analyze, and respond to changes that could affect the system). Without adequate monitoring, including a plan for evaluating the VISN realignment, VHA cannot be certain that the changes being made are effectively addressing deficiencies; nor can it ensure lessons learned can be applied to future organizational structure changes.

What GAO Recommends

GAO recommends that VHA (1) develop a process to ensure that organizational structure recommendations are evaluated for implementation; and (2) evaluate the implementation of the VISN realignment to determine and correct deficiencies, and apply lessons learned to future organizational structure changes, such as possible changes to VISN staffing models. VA concurred with GAO's recommendations.