Legislative Hearing on: “H.R. 984, To amend title 38, United States Code, to direct the Secretary of Veterans Affairs to provide timely equitable relief to an individual who suffers a loss based on an administrative error by the Secretary, and for other purposes; H.R. 1663, Veterans Scam and Fraud Evasion (VSAFE) Act of 2025; H.R. 3185, Personnel Integrity in Veterans Affairs Act of 2025; H.R. 3455, Veterans Affairs Distributed Ledger Innovation Act of 2025; H.R. 3482, Veterans Community Care Scheduling Improvement Act; H.R. 3483, Forcing Real Accountability for Unlawful Distributions (FRAUD) Act of 2025; H.R. 3494, VA Hospital Inventory Management System Authorization Act; Discussion Draft, To authorize the Secretary of Veterans Affairs to carry out a program to modernize the electronic health record system of the Department of Veterans Affairs, and for other purposes; Discussion Draft, To amend title 38, United States Code, to prohibit the collection of a health care copayment by the Secretary of Veterans Affairs from a veteran after a two-year period if the delay in collection is attributable to a failure of an employee, official, or information system of the Department of Veterans Affairs to process certain information within applicable timeliness standards established by the Secretary

1[House Hearing, 119 Congress]2[From the U.S. Government Publishing Office]34                          LEGISLATIVE HEARING56=======================================================================78                                HEARING910                              BEFORE THE1112              SUBCOMMITTEE ON OVERSIGHT AND INVESTIGATIONS1314                                 OF THE1516                     COMMITTEE ON VETERANS' AFFAIRS1718                     U.S. HOUSE OF REPRESENTATIVES1920                    ONE HUNDRED NINETEENTH CONGRESS2122                             FIRST SESSION2324                               __________2526                        WEDNESDAY, JUNE 11, 20252728                               __________2930                           Serial No. 119-253132                               __________3334       Printed for the use of the Committee on Veterans' Affairs3536[GRAPHIC NOT AVAILABLE IN TIFF FORMAT]3738                    Available via http://govinfo.gov3940                                __________4142                   U.S. GOVERNMENT PUBLISHING OFFICE4361-123                     WASHINGTON : 20254445-----------------------------------------------------------------------------------4647                     COMMITTEE ON VETERANS' AFFAIRS4849                     MIKE BOST, Illinois, Chairman5051AUMUA AMATA COLEMAN RADEWAGEN,       MARK TAKANO, California, Ranking52    American Samoa, Vice-Chairwoman      Member53JACK BERGMAN, Michigan               JULIA BROWNLEY, California54NANCY MACE, South Carolina           CHRIS PAPPAS, New Hampshire55MARIANNETTE MILLER-MEEKS, Iowa       SHEILA CHERFILUS-MCCORMICK,56GREGORY F. MURPHY, North Carolina        Florida57DERRICK VAN ORDEN, Wisconsin         MORGAN MCGARVEY, Kentucky58MORGAN LUTTRELL, Texas               DELIA RAMIREZ, Illinois59JUAN CISCOMANI, Arizona              NIKKI BUDZINSKI, Illinois60KEITH SELF, Texas                    TIMOTHY M. KENNEDY, New York61JEN KIGGANS, Virginia                MAXINE DEXTER, Oregon62ABE HAMADEH, Arizona                 HERB CONAWAY, New Jersey63KIMBERLYN KING-HINDS, Northern       KELLY MORRISON, Minnesota64    Mariana Islands65TOM BARRETT, Michigan6667                       Jon Clark, Staff Director68                  Matt Reel, Democratic Staff Director6970              SUBCOMMITTEE ON OVERSIGHT AND INVESTIGATIONS7172                   JEN KIGGANS, Virginia, Chairwoman7374AUMUA AMATA COLEMAN RADEWAGEN,       DELIA RAMIREZ, Illinois, Ranking75    American Samoa                       Member76JUAN CISCOMANI, Arizona              TIMOTHY M. KENNEDY, New York77KEITH SELF, Texas                    HERB CONAWAY, New Jersey7879Pursuant to clause 2(e)(4) of Rule XI of the Rules of the House, public80hearing records of the Committee on Veterans' Affairs are also81published in electronic form. The printed hearing record remains the82official version. Because electronic submissions are used to prepare83both printed and electronic versions of the hearing record, the process84of converting between various electronic formats may introduce85unintentional errors or omissions. Such occurrences are inherent in the86current publication process and should diminish as the process is87further refined.8889                         C  O  N  T  E  N  T  S9091                              ----------9293                        WEDNESDAY, JUNE 11, 20259495                                                                   Page9697                           OPENING STATEMENTS9899The Honorable Jen Kiggans, Chairwoman............................     1100The Honorable Delia Ramirez, Ranking Member......................     2101102                               WITNESSES103                                Panel I104105Ms. Cherri Waters, Acting Deputy Chief Information Officer,106  Executive Director, Health Portfolio, Product Delivery107  Services, Office of Information and Technology, U.S. Department108  of Veterans Affairs............................................     4109110        Accompanied by:111112    Ms. Laura Duke, Chief Financial Officer, Veterans Health113        Administration, U.S. Department of Veterans Affairs114115    Dr. Toni Phillips, Chief Nurse Informatics Officer,116        Electronic Health Record Management Information Office,117        U.S. Department of Veterans Affairs118119Dr. Jennifer McDonald, Director, Community Care Division, Office120  of Audits and Evaluations, Office of the Inspector General,121  U.S. Department of Veterans Affairs............................     6122123                                Panel II124125Mr. Cole T. Lyle, Director of the Veterans Affairs &126  Rehabilitation (VA&R) Division, The American Legion............    14127128Mr. Cody Carbone, Chief Executive Officer, The Digital Chamber...    16129130Dr. Edward O'Bryan, MD, MBA, CPE, Chief, Veterans and Corrections131  ICCE, Associate Professor of Medicine, Medical University of132  South Carolina.................................................    17133134                                APPENDIX135                    Prepared Statements Of Witnesses136137Ms. Cherri Waters Prepared Statement.............................    29138Dr. Jennifer McDonald Prepared Statement.........................    52139Mr. Cole T. Lyle Prepared Statement..............................    57140Mr. Cody Carbone Prepared Statement..............................    70141Dr. Edward O'Bryan, MD, MBA, CPE Prepared Statement..............    82142143                       Statements For The Record144145The Honorable Ken Calvert, U.S. House of Representatives, (CA-41)146  Prepared Statement.............................................    87147The Honorable Scott Franklin, U.S. House of Representatives, (FL-148  18) Prepared Statement.........................................    88149Concerned Veterans for America Prepared Statement................    89150151                          LEGISLATIVE HEARING152153                              ----------154155                        WEDNESDAY, JUNE 11, 2025156157             Subcommittee on Oversight and158                            Investigations,159                    Committee on Veterans' Affairs,160                             U.S. House of Representatives,161                                                    Washington, DC.162    The subcommittee met, pursuant to notice, at 2:15 p.m., in163room 360, Cannon House Office Building, Hon. Jen Kiggans164[chairwoman of the subcommittee] presiding.165    Present: Representatives Kiggans, Radewagen, Ciscomani,166Self, Ramirez, Kennedy, and Conaway.167168          OPENING STATEMENT OF JEN KIGGANS, CHAIRWOMAN169170    Ms. Kiggans. Good afternoon. Thank you to our witnesses for171being here today. Without objection, the chair may declare a172recess at any time.173    I would also like to welcome the members present from the174Subcommittee on Technology Modernization--I think they are on175their way--and the other members who have sponsored bills on176today's agenda who will be joining us today who are, hopefully,177on their way as well.178    Today's hearing is about coordinating with other179individuals who also care deeply about how veterans are treated180and who represent organizations with expertise on the proposed181legislation on the agenda this afternoon.182    We will use the feedback and ideas they share with us to183make informed policy decisions to improve the delivery of184services at the U.S. Department of Veterans Affairs (VA).185    We have nine important legislative proposals to consider186here today. It is important to note that not all of the187proposals will move forward in the legislative process. The188valuable insight provided by these members, stakeholders, and189agencies is fundamental to the work of the subcommittee.190    During today's legislative hearing we will examine a191variety of bills, including bills that impact the VA's systems192in technology, acquisition, pay, and accountability. The agenda193includes H.R. 984, sponsored by Representative Van Orden, which194would direct the VA Secretary to cancel agreements with debt195collectors to collect debt from veterans if the VA determines196the debt was due to an error.197    The Veterans Scam Fraud Evasion Act of 2025, sponsored by198Representative Calvert, would codify an office at the VA that199is needed to fight against scammers targeting veterans.200    H.R. 3185 the Personnel Integrity in Veterans Affairs Act201of 2025, sponsored by Representative Franklin, would provide202oversight bodies with the tools to complete their203investigations into misconduct and improve the Federal204workforce by requiring the VA to make note in their personnel205file if they resign under investigation.206    The bill sponsored by Representative Gray, which would207prohibit the VA from collecting copays after 2 years if the208delay in collection is due to a VA failure in timely209processing.210    H.R. 3482, the Veterans Community Care Scheduling211Improvement Act, sponsored by Representative Barrett, would212establish a program for the VA employees to directly schedule213health care appointments for veterans receiving community care.214    H.R. 3455, the Veteran Affairs Distributed Ledger215Innovation Act of 2025, sponsored by Representative Mace, would216direct the VA to conduct a study on the use of distributed217ledger technology to modernize the claims process.218    H.R. 3483, Forcing Real Accountability for Unlawful219Distributions, or the FRAUD Act of 2025, sponsored by220Representative Barrett, would direct the VA to implement an221information technology (IT) system to detect fraud, waste, and222abuse and payment processing for community care payment223submissions.224    A discussion draft of legislation to improve the VA225Electronic Health Record Modernization (EHRM) program, and226last, my legislation H.R. 3494, the VA Hospital Inventory227Management System Authorization Act, which would authorize the228VA to purchase or develop and modernize inventory management229system for hospitals. Inventory modernization is an important230step forward to more effectively manage the crucial medical231equipment and other assets providers need to deliver first232class health care to our Nation's veterans.233    I am eager to hear more from our members and witnesses234about these bills, and I want to thank our witnesses again for235being here today. I look forward to our discussion.236    I now recognize Ranking Member Ramirez for her opening237remarks.238239       OPENING STATEMENT OF DELIA RAMIREZ, RANKING MEMBER240241    Ms. Ramirez. Thank you, Chair Kiggans.242    I want to first start by thanking our witnesses that are243here today, Dr. Phillips, Ms. Duke, Ms. Waters, and Ms.244McDonald. Thank you for being with us today.245    When I first joined this committee a couple of years ago, I246hoped to find common ground with my more conservative247colleagues because we were united by a shared belief that it is248our responsibility to serve those who sacrifice so much for our249country, our diverse veterans. I have to admit that I continue250to be disappointed as I witness the erosion of the spirit of251bipartisanship in our committee.252    While I am committed to work on today's bills on253advancement and modernization of the VA, I cannot help but254point out that contrary to the traditions of this committee, we255are discussing eight Republican-led bills and only one256Democratic-led bill. In the past, for every two bills from the257majority we considered a bill from the minority, so you can258understand my disappointment that while we are, in fact, going259to discuss modernization of the VA, we omitted and disregarded260Democratic legislation on the subject that could bring even a261greater level of transparency and accountability to the VA. Let262me give you a couple of examples. Congressman Kennedy's VA263Funding and Workforce Protection Act, which would reinstate264veterans have been illegally terminated from the VA and exempt265them from the hiring freezes.266    Or Dr. Conaway's VA Data Act, which addresses serious267privacy concerns veterans have shared with us and would prevent268Department of Government Efficiency (DOGE) from accessing269veterans' personnel information from the VA systems.270    I hope I have the chance to discuss the bills that I plan271to introduce over the next few months, which would include a272bill to restore collective bargaining rights for VA employees273and a bill that would bring much needed transparency to VA's274relationship with special government employees.275    While I am disappointed at the ratio of Republican to276Democratic bills that is so low in this hearing, I am proud of277the single Democratic-led bill on today's agenda, Congressman278Gray's Stop Troubling Retroactive Invoices for Veterans279Expenses (STRIVE) Act. The bill would prohibit the VA from280collecting co-pays from veterans in specific situations when281the billed care is more than 2 years old, or the debt incurred282by the veteran is due to the department's fault and exceeds283$2,000.284    This bill would protect veterans by ensuring that they are285not on the hook for surprise medical bills due to dysfunction286or error in VA systems. It is a common sense step to shield287veterans from avoidable financial burdens.288    Today we will also be considering bills on modernization289efforts within the department, and that is a timely and crucial290conversation. If I am being honest with you from my291perspective, we cannot successfully realize modernization292without the infrastructure needed to actually support it and293implement it.294    For example, Secretary Collins has announced his plans to295accelerate the electronic health record modernization--we call296it the EHRM program--to 13 sites next year and 26 the following297year. At the same time there is a doubling of the sites, there298is a reduction in the EHRM integration office staff, about 10299percent of whom took the deferred resignation program.300    Chair Kiggans' H.R. 3494 seeks to initiate a pilot program301to test adequacy of a centralized supply chain solution at one302VA Medical Center, but the VA has tried four previous times to303realize its supply chain solution without identifying what304critical infrastructure was needed for previous pilots to305succeed. I got to tell you, I am concerned we are bound to306repeat the same mistake from the past.307    Congressman Franklin's Personnel Integrity in Veteran308Affairs Act would require investigative bodies, like the Office309of Inspector General (OIG) and the Office of Accountability and310Whistleblower Protection, to continue investigating employees311even after they have left the department.312    While no investigation should conclude without a proper313resolution, the legislation does not acknowledge that limited314resources could impede these investigations.315    As we consider modernization, I just want to echo my316colleagues on the Technology Modernization Subcommittee, who317have pointed out that we must pursue a balance of investments318in technology with equivalent investments in staffing and319resources when we are rolling out these modern solutions320because without investing in all of these three areas-321modernization, staffing, and resources-VA will not be able to322implement the modernizations our veterans desperately need.323    This administration is doing the opposite, openly324undermining the VA, proposing major reorganization, and engaged325in reductions in force. Their efforts weaken the very internal326infrastructure of the VA that the modernization depends on. It327is almost as if privatization is the end game.328    Deconstruct infrastructure, create new systems and329protocols that rely on infrastructure, and complain that there330is no infrastructure to support the changes and then have a331seemingly novel idea: outsource the service.332    As we consider today's legislation, we need to keep in mind333that we cannot have honest discussions about modernization334without getting honest about the internal infrastructure needed335to provide our veterans with the quality, comprehensive, and336accessible services.337    Chair Kiggans, I hope we can make the changes needed before338we advance these bills to the full committee. With that, I339yield back.340    Ms. Kiggans. Thank you, Ranking Member Ramirez.341    Before hearing their testimony, I will introduce the342witnesses on today's first panel. Representing the Department343of Veteran Affairs we have Ms. Cherri Waters, acting Deputy344Chief Information Officer (DCIO) and Executive Director of the345Health Portfolio Product Delivery Services in the Office of346Information and Technology. Ms. Waters is accompanied by Ms.347Laura Duke, the Chief Financial Officer of the Veteran Health348Administration and Dr. Toni Phillips, Chief Nurse Informatics349Officer of the Electronic Health Record Management Information350Office.351    Also for on our first panel, representing the office of the352Inspector General, Dr. Jennifer McDonald, Director of the353Community Care Division, Office of Audits and Evaluations and354Office of the Inspector General.355    We will now swear in our witnesses. If you could, please356stand and raise your right hand? Do you solemnly swear that the357testimony you are about to provide is the truth, the whole358truth, and nothing but the truth?359    Thank you. You may be seated.360    [Witnesses sworn.]361    Ms. Kiggans. Let the record reflect that all witnesses362answered in the affirmative.363    Ms. Waters, we will start with you. You are now recognized364for 5 minutes to provide your testimony on behalf of the365Department of Veteran Affairs.366367                   STATEMENT OF CHERRI WATERS368369    Ms. Waters. Good afternoon, Chairwoman Kiggans, Chairman370Barrett, Ranking Member Ramirez, Ranking Member Budzinski, and371members of the subcommittees. Thank you for inviting us here372today to present our views on several bills that would affect373the Department of Veterans Affairs' programs and services.374Joining me today are Ms. Laura Duke, Chief Financial Officer375for Veterans Health Administration (VHA) and Dr. Toni Phillips,376Chief Nurse Informatics Officer for the EHRM Implementation377Office.378    While VA's views on all the bills are detailed in my379written testimony, including areas of concern and support, I380would like to highlight some of the bills in my opening381remarks. First, VA supports, subject to amendments and382availability of appropriations, the Forcing Real Accountability383for Unlawful Distributions Fraud Act of 2025. VA strongly384supports using the franchise fund, and we estimate that the385savings from preventing overpayments will more than cover the386technologies and services to fully recover all the costs.387    However, as written we believe the bill would not cover388those claims at highest risk for fraud or overpayment. VA would389welcome the opportunity to discuss several technical390improvements to the bill that could provide VA enhanced391authority to combat fraud, waste, and abuse.392    VA supports the intent of the Veterans Community Care393Scheduling Improvement Act, subject to amendments and394availability of appropriation. VA fully agrees that it can and395should improve the patient scheduling experience.396    However, we are concerned that specific legislation on this397topic could constrain our ability to address veterans' needs398and emerging issues. This bill seems to duplicate some of the399work previously done as part of VA's 2022 integrated product400team, as well as other efforts, including those to implement401the Cleland-Dole Act.402    VA is already working to develop a self-service scheduling403platform and does not require additional authorities. Rather,404the challenges facing VA are both technical and process-based,405and VA recommends a human-centered-based design study that406would address both technical and non-technical elements of the407issue.408    VA also welcomes the effort to modernize VA's current409inventory management systems and improve overall efficiency in410supply chain management. We therefore support the VA Hospital411Inventory Management System Authorization Act, subject to some412amendments and the availability of appropriations.413    Last, VA also supports the intent of modernizing VA's414Electronic Health Record System, subject to amendments and the415availability of appropriations. Regarding Section 3, VA416acknowledges the importance of the EHRM as a critical priority417for VA but also believe there is an opportunity for VA and the418committee to collaborate to address technical concerns in this419section.420    Likewise, VA looks forward to working with the committee to421address technical concerns in Sections 4, 6 and 7. VA agrees422with the intent of Section 5 to protect veterans personal and423protected information and welcomes the opportunity to work with424the committee to ensure this section effectively addresses that425concern.426    VA further agrees with the importance of reporting427requirements contained in Sections 8 through 16 and welcomes428the opportunity to work with the committee to ensure that VA429can develop the information and address the committee's430concerns.431    Chairwoman Kiggans, Chairman Barrett, this concludes my432statement. We appreciate the congressional intent embodied in433the bills on today's agenda and welcome the opportunity to work434closely with Congress on these important issues. My colleagues435and I are prepared to respond to any questions that you or436other members of the subcommittees may have.437438    [The Prepared Statement Of Cherri Waters Appears In The439Appendix]440441    Ms. Kiggans. Thank you, Ms. Waters. The written statement442of Ms. Waters will be entered into the hearing record.443    Dr. McDonald, you are now recognized for 5 minutes to444provide your testimony on behalf of the VA Office of the445Inspector General.446447                 STATEMENT OF JENNIFER MCDONALD448449    Dr. McDonald. Chairwoman Kiggans, Ranking Member Ramirez,450and members of the subcommittees, thank you for the opportunity451to testify on the independent oversight conducted by the OIG on452VHA's pause in its program integrity tool, which relates to453H.R. 3483.454    Our testimony on this tool was requested by the455subcommittee because the FRAUD Act of 2025 requires VA to456analyze community care claims using an IT system to detect457overpayments and other fraud, waste, and abuse. This is458something that the program integrity tool did previously in a459limited capacity.460    The program integrity tool is a repository that461consolidates data from multiple VA community care programs462after a claim has been paid by VA. For revenue operations, VHA463uses data from the tool to determine if veterans or their464private insurance companies should be billed for care that is465not service-connected.466    To support VHA's fraud and waste detection and mitigation467efforts, data from the tool can be used to identify duplicate468claim payments or indicators of potential fraud, such as469payments to the same provider in different locations on the470same day.471    VA paused operations of the program integrity tool in472February 2023 after becoming aware of ongoing issues with its473data base logic and unreliable data. The pause was intended to474allow VHA time to evaluate the tool's processes, data, and its475underlying IT system to determine the causes of any data errors476and identify improvement opportunities.477    In July 2024, we issued a management advisory memorandum to478VA leaders highlighting the major impacts of the tool's pause479on VHA's revenue collection processes and on identifying fraud,480waste, and abuse related to community care claims. In response481to this work, VA officials stated that they had resumed using482data from the program integrity tool for revenue collection for483claims but were still considering the path forward for the484tool's oversight functions, including audit and compliance485efforts.486    While the tool was offline, VHA had limited ability to487collect revenue of more than 660 million dollars from veteran's488co-payments or from private health insurers. This may489negatively affect veterans because they could receive co-490payments for bills that are well over a year old.491    The pause also affects the resources needed to address the492significant billing backlog. VHA staff have been reviewing tens493of millions of community care claims to determine which were494billable for veteran co-payments or to private insurers. VHA495will need to make certain that revenue operations staff has496sufficient resources and processes through timely review and497bill the full backlog of community care claims.498    Currently, the program integrity tool is still not being499fully used for the prevention, detection, and mitigation of500fraud, waste, and abuse for paid community care claims. It is501vital that the Office of Integrity and Compliance also have the502needed resources to perform timely fraud, waste, and abuse503examinations of community care claims to ensure the proper use504of taxpayer dollars.505    In addition to the FRAUD Act, many of the other bills under506consideration require VA to develop or improve its IT systems.507IT modernization has consistently been a major management508challenge for the VA. Our work has identified extensive509breakdowns with upgrading or replacing key systems, as well as510significant cost overruns.511    The OIG remains vigilant in overseeing all significant IT512initiatives to identify all risks to veterans, their families,513and survivors. To do this, Inspector General (IG) staff monitor514programs and operations for breakdowns in processes, for515noncompliance with mandates, for failures to provide timely and516quality healthcare, and for deficiencies in the delivery of517benefits and services to veterans.518    We will continue to advance accountability by conducting519effective oversight into how VA plans, implements, and520remediates identified weaknesses in its system modernization521efforts.522    This concludes my statement, and I am happy to answer any523questions you may have.524525    [The Prepared Statement Of Jennifer McDonald Appears In The526Appendix]527528    Ms. Kiggans. Thank you, Dr. McDonald. The written statement529of Dr. McDonald will be entered into the hearing record.530    We will now turn to questions, and I yield myself 5531minutes. The Chair just reminds our witnesses to speak directly532into the microphones when answering your questions so we can533hear or listening members can hear.534    Ms. Waters, how would a modern inventory system at the VA535hospitals help improve VA oversight of its inventory536collection?537    Ms. Waters. Thank you very much for that question. We538believe that the modern inventory system will help us with539oversight of having access to view all inventory across the540entire enterprise in a single unified view and help make sure541that we are in front of any challenges with inventory and542supplies and most efficiently using resources across the VA.543    Ms. Kiggans. How big of a problem is it right now that you544do not have this oversight in place?545    Ms. Waters. As I think you are well aware, we do have546multiple inventory systems in place at this time. We do have547three systems that are running, one of which has many instances548and so that does lead to disparity and difficulty with549collection of information.550    It is important to note that replacing the system is part551of our supply chain modernization, and it is an effort that is552under way at the VA at this time. We are fully confident that553we can implement this system for inventory and asset management554across the enterprise.555    Ms. Kiggans. Great, thank you. Then again, Ms. Waters, what556standards will the VA use to implement this advanced technology557if it becomes available for hospitals? You talked about there558are different systems right now. Will they be integrated into559one and will there be other changes?560    Ms. Waters. Correct. We will have, at the end of this561initiative we will have a single system that is providing asset562and inventory management across the enterprise. We have built a563dynamic set of requirements to define what needs to be564contained in that system, and we are currently working on565procurement processes to move forward with that process.566    Ms. Kiggans. Great. Who would be trained on how to use this567new system if it were to be implemented?568    Ms. Waters. Anyone that would be required to use the system569will receive the needed training. Obviously, part of our goal570is to make the system designed in a real human-centric way so571that the ease of use minimizes training needs, et cetera, but572anyone that needs to interact with the system will receive573appropriate training.574    Ms. Kiggans. Great. That is great to hear. Also, we have575had conversations just with different veterans, especially ones576who are older adults who are often victims of scammers and are577targeted by scammers through phone calls, emails, texts, and578letters in the mail.579    One of the bills addresses this type of fraud in the new580information technology system. How would this type of system581help our older veterans protect themselves from fraud?582    Ms. Waters. That is obviously related to the Veterans Scam583and Fraud Evasion (VSAFE) bill that is proposed, and we fully584support any efforts to help protect the veterans from being585succumbed to scams of any sort. It is important to note the VA586has had a VSAFE officer in place since 2023, and therefore, we587recommend that the bill clearly establish that VSAFE officer588position in the Veterans Experience Office to ensure that589incumbent can do everything they can to help these veterans.590    Ms. Kiggans. How does VSAFE currently collaborate with591other efforts within the Federal Government to prevent fraud592and scams?593    Ms. Waters. Unfortunately, that is not a subject I have594detailed information on but I am happy to take that question595for the record and get additional information.596    Ms. Kiggans. Just curious if it will work with other597existing systems to provide the best just protection for our598veterans.599    Last question for Ms. Waters, you know, we have been600pushing for good leadership and improved processes at the VA601since I have been on this subcommittee, so how is the VA making602sure these performance plans keep political appointees603accountable?604    Ms. Waters. Thank you for that question. Obviously, one of605the focuses that we have overall is accountability in the606organization and so I know that there have been changes that607have been put into place for performance plans. We are always608focused on accountability.609    Ms. Kiggans. Great.610    Then one last question for Dr. McDonald, are you aware of611investigations conducted by OIG where an individual retired,612resigned, or transferred to another Federal agency while under613investigation by the VA?614    Dr. McDonald. In terms of that being related to H.R. 3185,615I think that some of my OIG colleagues are working with your616subcommittee staff on our knowledge around and our views617related to that bill, so I would rather have them speak on that618because I am not knowledgeable about that. I think we should619let them discuss that with your staff.620    Ms. Kiggans. That is fine. Real quick, in accordance with621committee rule 5E, I ask unanimous consent that Representative622Barrett from Michigan be permitted to participate in today's623subcommittee hearing. Without objection, so ordered.624    Just one last question, from an oversight perspective would625it be beneficial for a Federal agency to know if an applicant626has been under prior investigation at a separate Federal627agency? Dr. McDonald.628    Dr. McDonald. From an oversight perspective any information629we have would be helpful to our ongoing audits. Generally, our630audits are related to programmatic oversight more than specific631individuals.632    Ms. Kiggans. Great, thank you.633    I will now yield 5 minutes to the ranking member for her634questions.635    Ms. Ramirez. Thank you, Chairman. As I mentioned earlier,636our agenda today contained several bills which would authorize637the VA to move forward with modernization efforts like the VA638scheduling supply chain management and fraud, waste, and abuse639detection. Modernization of the systems is absolutely critical,640however, doing so without compromising the continuum of care641for veterans requires thorough and careful investigation of the642root problems and the potential implementation challenges.643    Dr. McDonald, how important is adequate staffing, clear644internal processes, and assessments of previous failures when645the VA moves to implement technologies like the electronic646health record and the centralized supply chain solution?647    Dr. McDonald. Sure. Our work in different areas has found648that resources, clear processes, and assessments of both649failures and successes is important in implementing any updated650technology.651    For an example, as you mentioned in your opening statement,652VA has started and stopped multiple times modernization efforts653for its supply chain and inventory management because the654department had not fully assessed its needs.655    As another example, our work in EHRM has identified that a656lack of a full deployment schedule and full cost estimates up657front resulted in implementation delays and challenges.658    Our perspective is that in general VA needs to make sure659they assess full needs upfront, develop processes and guidance,660provide training, and then also assess the effectiveness of any661modernization efforts after they are implemented.662    Ms. Ramirez. Thank you, Ms. McDonald. I agree with that. I663appreciate that.664    Dr. Phillips and Ms. Waters, can you commit to providing665the committee with data regarding the number of staff that666touched the modernization efforts we are discussing today, for667example, EHRM, supply chain, scheduling, and fraud and waste668and abuse monitoring, who have taken the Deferred Resignation669Program (DRP), who have resigned or otherwise left the VA since670January 20th, 2025?671    Ms. Waters. Yes, Ranking Member. We commit to taking that672question for the record and providing that information.673    Ms. Ramirez. Thank you so much. I know that I asked that674also of Dr. Phillips, just for the record?675    Dr. Phillips. Yes. We can take that back. We are working676with our leadership on that and certainly we will provide that677information.678    Ms. Ramirez. Thank you, Dr. Phillips. It is critical our679committee has updated numbers regarding the staffing of the680service lines before deploying new systems, so I appreciate681that.682    Ms. Waters, I want to come back to you. Has the VA683performed an assessment of previous failures of the supply684chain modernization program, like the Defense Medical Logistic685Standard Support (DMLSS) and the latest solicitation last year,686to ensure future efforts will not be subject to the same687pitfalls?688    Ms. Waters. Thank you for that question. We actually have689performed an assessment of previous challenges that have690happened, and as we have briefed the subcommittee on691previously, one of the things that we are doing in the supply692chain modernization effort at this point is doing a very693disciplined, incremental approach to ensure that we do not694suffer to the large program failures that have been seen in the695past.696    Ms. Ramirez. Can you commit to providing some more of that697information to our committee before you move forward with the698supply chain modernization program?699    Ms. Waters. Yes. We can do that.700    Ms. Ramirez. Thank you. Let me ask you one last follow-up701question here. Do you feel that you have addressed the702challenges that if we had moved forward with this pilot to703restart the effort of H.R. 3494 and what it calls for, that it704would be resolved?705    Ms. Waters. I do think--again, we are approaching it in a706very disciplined, incremental fashion to ensure that we do not707have those challenges.708    Ms. Ramirez. Got it. I know I only have a minute so let me709try to move through my questions quicker. Your testimony710highlights challenges the VA may face in implementing Rep.711Franklin's personnel integrity bill due to new programs being712implemented by U.S. Office of Personnel Management (OPM). How713would Secretary Collins and pending reorganization plans impact714the modernization efforts and vision in these bills today?715    Ms. Waters. I cannot speak directly to that question on the716plans. As you know, the secretary has been very clear that he717is working on a plan and that he will come back and brief once718the plan has been finalized.719    Ms. Ramirez. Okay. Thank you, Ms. Waters, and that is720actually what I am concerned about. We are waiting for these721plans and what this reorganization will do and the impact while722we are talking about implementing modernization. I just want it723for the record that this is very clear.724    This is not directed at anyone in particular here, but I725would be remiss if I did not share my concerns with H.R. 3185,726the Personnel Integrity in Veterans Affairs Act. I hope we can727work with Rep. Kiggans and Rep. Franklin to help make this bill728better.729    I would also like to ask the VA, will you commit to730providing technical assistance on these bills before our markup731June 26th? Would you commit to provide technical assistance?732    Ms. Waters. Thank you for that question. We absolutely will733commit to working and collaborating with the committee.734    Ms. Ramirez. Thank you. With that, I yield back, Chairman.735    Ms. Kiggans. The chair now recognizes Mr. Barrett for 5736minutes.737    Mr. Barrett. Thank you, Madam Chair, appreciate it. Thank738you for your willingness to allow me to participate in today's739hearing.740    Panelists, thank you. I wanted to speak with you about a741bill that I introduced, the FRAUD Act, which is before us742today, which would require the VA to acquire an IT system to743improve the department's ability to detect fraud or waste or744overcharging or overbilling in the community care program or in745care that is done outside the VA.746    I wanted to start with Ms. Duke for a moment. VA's747testimony on the FRAUD Act stated that the savings generated748from preventing overpayments would quote, ``more than pay for749the technology and services,'' end quote. I was very excited to750see that. I think we should get, like, a refund for introducing751the bill.752    With that being the case, can you explain how the VA came753to that conclusion? Is it a little bit of perhaps self-754awareness about the process right now and how you, kind of,755reached that conclusion?756    Ms. Duke. I believe that that is based on comparing our757experience to private sector standards of recoupment because we758would intend to pursue such a system through our revolving759funds. The idea would be that the revenue generated would760ultimately pay for the investment.761    Mr. Barrett. Yes. Okay. No. That is very encouraging and I762appreciate that. I also know that the bill does not include any763authorities for monetary penalties or fines or things of that764sort in a penalized fashion against providers who submit765fraudulent claims. Is that an authority that the VA would like766but does not have presently?767    I guess it was my thought in drafting the bill the way we768did that that would fall under more of a, like, enforcement769agency and less on the VA.770    Ms. Duke. I would say the challenge is that a lot of times771we are not well-equipped to identify the intent that is772necessary to constitute fraud.773    Mr. Barrett. Okay.774    Ms. Duke. What such a system would do is help us identify775where there are overpayments to focus recoupment attempts. I776think we would defer to the Department of Justice or others to777investigate fraud.778    Mr. Barrett. Okay. No, I appreciate that.779    Then, Dr. McDonald, could you just walk me through780basically how many community care claims does VA process for781payment on an annual basis? If you have any examples of fraud782or waste that you have identified and what department we would783need to look for as the most problematic likelihood of risk?784    Dr. McDonald. Sure. I am just opening my binder here. It is785going to vary year to year but, for example, for the 1-year786period where the program integrity tool--and this is just this7871 year because I have it in front of me--was down, the788community care number of claims that were processed so they789were not able to be run through the program integrity tool for790co-payments was about 40 million and the dollar amount attached791to that was about $28.6 billion.792    Mr. Barrett. $28.6 billion in total community care, not793suspected fraud, correct?794    Dr. McDonald. Correct.795    Mr. Barrett. Yes. Okay. Then do you have any ballpark796figure of fraud or do you have any examples for us of things797that went through the system until a more manual process was798done to determine that they were fraudulent?799    Dr. McDonald. Things that our investigators look for when800they are looking for fraud is they look to see if there are801duplicate payments to providers for the same service. They will802look to see if providers are providing services to different803veterans or in different locations in the same day.804    They would have, before the program integrity tool went805offline, used data from the tool to do that. When it was806offline they were able to use the actual claim payment data to807keep doing that.808    Mr. Barrett. Okay, thank you. I know we have seen examples809of Medicaid fraud by providers in, you know, certainly that is810done mostly at the community level, whereas the VA is so811predominantly within the VA facilities and then the community812care augments that.813    Knowing examples of just even Medicaid fraud that is taking814place and other fraudulent billing and other things of that815sort, I think it really does drive home the point of things816that we need to be mindful of and recognizing.817    I also think that the deterrent effect would, hopefully,818also make itself worthwhile so that if a provider knows that819there is this, you know, watchdog agency or, you know, a system820that would, kind of, analyze and accrue risk factors, that that821would hopefully deter the likelihood of those events from822happening.823    Appreciate the testimony today and look forward to working824with you in pursuit of getting this bill done and across the825finish line, so thank you.826    Madam Chair, I yield back.827    Ms. Kiggans. Thank you. In accordance with committee rule 5828(e), I ask unanimous consent that Representative Gray from829California be permitted to participate in today's subcommittee830hearing. Without objection, so ordered.831    The Chair now recognizes Mr. Gray for 5 minutes.832    Mr. Gray. Thank you, Chair Kiggans and Ranking Member833Ramirez for allowing me to join you this afternoon to speak834about my bill. I would also like to thank the committee's835Ranking Member, Congressman Takano, for co-sponsoring my836legislation.837    My bill H.R. 3812, The STRIVE Act, would prohibit the VA838from collecting co-pays from veterans in situations where the839collection delay is due to the fault of the department. This840includes a pause in collections, IT system failure, or an841employee administrative error.842    This bill also provides the Secretary with the authority to843enter into co-pay waivers on behalf of the veteran. As you may844know, under current law veterans are required to individually845initiate a request for a waiver. That leaves the burden in the846hands of the veteran.847    This bill rightfully places that burden on the government.848No veteran should pay the cost of administrative failures or849face unexpected costs when receiving care. That is why this850bill would protect veterans from paying co-pays that are billed851for care that is over 2 years old or exceeds 2,000 dollars,852including debts incurred following the pause of pharmacy co-853pays with the EHRM program, the COVID co-pay relief854expirations, and other IT system failures. Our Nation has a855responsibility to eliminate the barriers that stand in between856veterans and their care.857    Dr. McDonald, from your role at the Office of the Inspector858General, how often have you seen the IT system failures and859administrative errors resulting in delayed co-pays and other860financial burdens for veterans?861    Dr. McDonald. We have seen this in our oversight work. For862example, one of the places where we have seen this is when the863program integrity tool was down there was a delay in billing864veterans for co-payments for non-service-connected care, and it865was down from February 2023 through August 2024.866    It is also our understanding that right now revenue867operations is still working through the backlog of those868claims, so some veterans could still experience a delay in when869they receive a bill for a co-payment.870    Then the amount of the co-payments they receive will vary871depending on the services provided and their disability rating872and income when they receive those bills.873    Mr. Gray. Thank you.874    Ms. Waters, as I mentioned, our introduced text places the875burden of entering into debt waivers on the Federal Government.876Do you believe this would improve consistency and fairness for877veterans impacted by the departmental errors?878    Ms. Waters. I am going to defer that question to Ms. Duke.879    Ms. Duke. Yes, thank you. We agree that there is a greater880opportunity for consistency and more forward-leaning in881protecting our veterans. I think, again, our concerns with the882legislation included in the testimony get at making sure that883the legislation is consistent and we are able to equally884address veterans' needs without opening the door to perverse885incentives under the policy.886    Mr. Gray. Thank you.887    Ms. Waters, how many veterans are impacted by these delayed888co-pays from internal failures and errors like the Program889Integrity Tool (PIT) pause and the EHRM pharmacy co-pay issue?890    Or, Ms. Duke, do you want to take that?891    Ms. Duke. Yes, I will take that one. We do not know the892full number until we have fully ingested all of the data from893the PIT pause because one of the things that we are working our894way through is whether or not the veterans who received care895are liable for co-payments or whether they are exempt.896    Mr. Gray. I have been showing data that suggest over 85,000897veterans were impacted with the PIT pause.898    Ms. Duke. That sounds consistent with what we have seen.899    Mr. Gray. Okay, thank you.900    To me, this data further emphasizes the need for this901critical legislation. Veterans should not face barriers to care902they have rightfully earned. At a time when the Administration903seems focused on fraud and abuse, reckless cuts often make the904bureaucratic process even worse.905    This bill is an example where the burden is placed on the906Federal Government to make veterans' lives easier. That really907should be the gold standard, in my opinion, for reform. I look908forward to continuing this conversation with the Department of909Veteran Affairs to ensure this legislation addresses both the910agency and veteran needs.911    With that, I yield back.912    Ms. Kiggans. Thank you very much.913    With that, the first panel of witnesses is now excused and914I would like to invite the second panel of witnesses to come915forward.916    Thank you and welcome to our second panel. We will hear917today from the following witnesses: Mr. Cole Lyle, the Director918of the Veterans Affairs and Rehabilitation Division in919Washington, DC. Office of the American Legion; and Mr. Cody920Carbone, the Director of Government Relations at the Digital921Chamber; and Mr. Edward O'Bryan of the Medical University of922South Carolina (MUSC).923    I would now like to welcome you all and also ask you to924stand and please raise your right hand. Do you solemnly swear925the testimony you are about to provide is the truth, the whole926truth, and nothing but the truth?927    [Witnesses sworn]928    Ms. Kiggans. Thank you. You may be seated, and let the929record reflect that all witnesses have answered in the930affirmative. Thank you all for your attendance and testimony931this afternoon.932    Mr. Lyle, you are now recognized for 5 minutes to deliver933your testimony on behalf of the American Legion.934935                     STATEMENT OF COLE LYLE936937    Mr. Lyle. Well, thank you, Chairwoman Kiggans, Ranking938Member Ramirez, and distinguished members of the Subcommittee.939On behalf of National Commander James LaCoursiere, Jr. and the940more than 1.5 million dues-paying members of the American941Legion, thank you for the opportunity to testify today on942pending legislation.943    It is an honor to represent an organization that for over944100 years has stood as a voice for America's veterans, guided945by grassroots resolutions passed at the local post level and946elevated through our national convention.947    Today the American Legion supports nearly all the bills948under consideration because they reflect a bipartisan949commitment to strengthening accountability, improving access,950and safeguarding the dignity of those who have worn the951uniform. First, we strongly support H.R. 984, which provides952equitable relief to veterans harmed by administrative errors.953With the implementation of the Sergeant First Class Heath954Robinson Honoring our Promise to Address Comprehensive Toxics955(PACT) Act and record volume of claims submitted, the risk of956human error has grown.957    Veterans should not bear the financial and psychological958burden for mistakes beyond their control. The American Legion959in 2024 alone facilitated nearly $25 million in debt relief. We960know first-hand the impacts these errors can have.961    We also support H.R. 1663, the Veterans Scam and Fraud962Evasion, or VSAFE Act. Veterans are 40 percent more likely to963be targeted by financial scams and many fall victim due to964unique vulnerabilities tied to military service. Creating a965dedicated fraud officer at VA is not only overdue, it is966essential. Veterans deserve the same protections afforded to967consumers in the private sector.968    On accountability, the Legion backs H.R. 3185, which969ensures that VA employees under investigation for misconduct970cannot simply retire or transfer without consequences. This971legislation rightly balances due process with the need to972maintain trust in the VA workforce. We must hold ourselves to973the same standards of honor and integrity we expect from those974we serve.975    We also commend efforts to modernize and streamline access976to care. H.R.s 3482 and 3494 address longstanding problems with977community care scheduling and inventory management, problems978that continue to delay care and waste taxpayer dollars. These979bills harness smart technology to serve veterans more980efficiently and safely.981    While we support these bills, uniform training for VA982staff, particularly for scheduling, will prove vital to ensure983successful and effective implementation across the enterprise.984The Legion would also recommend VA schedulers have the ability985to provide veterans with an apples-to-apples comparison of wait986times and conversations with the individual veteran.987    With regard to electronic health records, the American988Legion supports the draft legislation to modernize the VA's989EHRM system. The past 2 decades of failed attempt and990fragmented leadership have cost time, money, and trust. Many of991this bill's provisions, including the establishment of a992baseline for standardized clinical workflows, develop clearly993defining leadership roles, and securing personal data will go a994long way toward program sustainability and successful995deployment at future sites.996    Finally, we support legislation that prohibits co-pay997collections from veterans when the delay is the VA's fault.998With recent extended pauses to VA collection of co-pays and999EHRM pharmaceuticals and the program integrity tool, many1000veterans are receiving delayed bills in the thousands of1001dollars which creates financial hardship on those with fixed1002incomes.1003    Veterans should not receive a bill years after receiving1004care due to internal system delays or administrative error.1005    Chairwoman Kiggans, Ranking Member Ramirez, our veterans do1006not ask for special treatment. They only ask for the care and1007benefits they earned delivered with competence, integrity, and1008compassion. The bills under discussion today move us closer to1009that standard.1010    The American Legion is proud to support these efforts.1011Thanks to this subcommittee for its advocacy on behalf of our1012Nation's veterans, and I look forward to answering your1013questions.10141015    [The Prepared Statement Of Cole Lyle Appears In The1016Appendix]10171018    Ms. Kiggans. Thank you, Mr. Lyle. The written statement of1019Mr. Lyle will be entered into the hearing record.1020    In accordance with committee rule 5 (e), I ask unanimous1021consent that Representative Mace from South Carolina be1022permitted to participate in today's subcommittee hearing.1023Without objection, so ordered.1024    Mr. Carbone, you are now recognized for 5 minutes to1025deliver your testimony on behalf of the digital chamber.10261027                   STATEMENT OF CODY CARBONE10281029    Mr. Carbone. Chairwoman Kiggans, Ranking Member Ramirez,1030and distinguished members of the subcommittee, thank you for1031the opportunity to testify before you this afternoon. My name1032is Cody Carbone, and I proudly serve as the Chief Executive1033Officer (CEO) of the Digital Chamber.1034    The Digital Chamber is a non-profit trade organization1035committed to promoting blockchain adoption. We envision a fair1036and inclusive digital ecosystem where everyone has the1037opportunity to participate.1038    I am here today on behalf of our membership representing1039over 200 companies across the globe. We sincerely appreciate1040the subcommittee's interest in harnessing emerging technologies1041to enhance the services provided to those who have served our1042Nation.1043    Congresswoman Nancy Mace has introduced H.R. 3455, the1044Veterans Affairs Distributed Ledger Innovation Act of 2025,1045directing the U.S. Department of Veterans Affairs to study how1046blockchain technology can revolutionize the delivery of1047veterans' benefits and services. Her efforts highlight1048bipartisan recognition that outdated 20th century systems are1049failing our veterans and that modern tools like blockchain must1050be explored.1051    Modernization cannot wait. Blockchain has the potential to1052transform the VA. The VA possesses a commendable history of1053innovation, ranging from the pioneering implementation of1054electronic medical records to recent advancements in cloud1055computing and artificial intelligence.1056    However, many of the legacy systems that once placed the VA1057at the cutting edge are now straining under 21st century1058demands, leading to slowing claims, fragmenting health records,1059and leaving veterans to navigate a maze of paper and outdated1060portals.1061    The VA provides critical benefits and care to a community1062of nearly 17 million U.S. military veterans, along with their1063families and survivors. Ensuring that these veterans receive1064efficient, transparent, and reliable services must be a1065national priority. We stand at a moment when the digital1066revolution can be utilized in the service of those who served1067us.1068    What is blockchain? Blockchain is not a buzzword or a1069speculative asset. It is infrastructure, a digital ledger that1070can secure records, automate trust, and facilitate coordination1071across silos without requiring central gatekeepers.1072    In practice, that means a veteran does not have to submit1073the same paperwork three times to three different agencies.1074Their medical records are available where and when they need1075them without compromising privacy. Benefits are paid on time1076with audit trails that prevent fraud and ensure accountability.1077    Credentials, discharge documents, and proof of service can1078be cryptographically verified in seconds. This is not theory.1079These are real world applications already working in financial1080services, health care, global supply chains, and even some1081government settings. What is missing is the commitment to apply1082these tools where they are most needed.1083    While blockchain presents solutions, it is crucial to note1084that blockchain is not a cure-all. Implementing innovation1085requires careful planning. The Digital Chamber and industry1086partners are ready to assist and share expertise as the VA and1087Congress explore these applications.1088    H.R. 3455 is a prudent first step in identifying high value1089opportunities and addressing any associated risks with the1090deployment of blockchain technology at the VA. It is a1091necessary step toward ensuring the VA's technology matches its1092mission, to care for those who have borne the battle.1093    In conclusion, Chairwoman, I would like to express my1094gratitude to you and the subcommittee for your exemplary1095leadership in examining emerging technologies related to1096veteran services and opportunities to reduce government waste.1097    I am appreciative of the opportunity to provide testimony1098today on this significant matter. I am prepared to respond to1099any questions or inquiries and to continue collaborating with1100you and the subcommittee in an effort to improve the systems1101that support our veterans. Thank you.11021103    [The Prepared Statement Of Cody Carbone Appears In The1104Appendix]11051106    Ms. Kiggans. Thank you, Mr. Carbone. The written statement1107of Mr. Carbone will be entered into the hearing record.1108    Dr. O'Bryan, you are now recognized for 5 minutes to1109deliver your testimony on behalf of the Medical University of1110South Carolina.11111112                  STATEMENT OF EDWARD O'BRYAN11131114    Dr. O'Bryan. Thank you for having me. Thank you to the1115committee and thank you to the veterans and dependents.1116    My name is Dr. Edward O'Bryan. I am an associate professor1117of medicine at the Medical University of South Carolina. Prior1118to this role, I had the privilege of serving as an attending1119physician for 6 years at the Ralph H. Johnson VA Medical1120Center, also in Charleston, South Carolina, where I also1121completed some residency training.1122    This hearing is deeply personal to me. The Ralph H. Johnson1123VA Medical Center is named in honor of a Marine who gave his1124life from Vietnam to save my uncle, Lieutenant Clebe McClary,1125also a proud Marine. My grandfather and father also served the1126United States Marine Corps. The bond I feel with the veteran1127community is not only professional, it is personal.1128    Over the past 15 years, I have worked at the intersection1129of VA and academic medicine, and I have seen first-hand how1130critical it is to maintain strong, stable, and streamlined1131relationships between VA medical centers and their academic1132affiliates. The partnerships between the VA and institutions1133like MUSC are essential for delivering the best possible care1134to our Nation's veterans.1135    The bills under consideration today would enhance those1136connections and ensure that veterans receive timely, high-1137quality care, whether within the VA or in the community1138setting, specifically to H.R. 3482. This bill creates a direct1139digital scheduling link between the VA and community providers.1140I have seen the benefits of this model first-hand.1141    By incorporating MUSC's specialists directly into the VA1142scheduling platform we have drastically reduced delays in1143consults and increased transparency for both patients and care1144teams.1145    Allowing VA staff to view and book community appointments1146will empower schedulers, reduce wait times, and improve1147outcomes. Our VA system, including Congresswoman Mace's1148district, has shown excellent results, as highlighted below.1149    We have built a strong academic affiliation with the Ralph1150H. Johnson VA. We started utilizing the External Provider1151Scheduling (EPS) system roughly January 2024, but it really1152ramped up only within the last 6 months. As of May 2025, we1153scheduled a total of 1,863 appointments utilizing the EPS1154system. Of those, 34 percent have been scheduled appointments1155at our system at MUSC.1156    The Ralph H. Johnson VA Center currently utilizes the EPS1157to schedule directly into 26 sub-specialties at MUSC in real1158time. I will not go through all the specialties, but the1159highlights are the majority of the specialties are orthopedics,1160hematology, oncology, a lot of specialties you might consider.1161    Data shows for the Charleston veterans who are eligible for1162and elect to utilize community care, scheduling the community1163care appointment through EPS reduces veteran wait time by an1164average of 8.8 days. On average, this wait time is reduced by116533 percent for all sites using EPS for community care within1166our area scheduling versus traditional community care1167scheduling, which involves calling and faxing.1168    In my time at MUSC and the Ralph H. Johnson VA Medical1169Center I cared for thousands of veterans, and the VA1170collaborates well with local academic affiliates. Veterans1171receive coordinated, specialist-driven, high quality, timely1172care. These legislative proposals all share a commitment to1173that mission: modernization, accountability, integrity, and1174faster access to care.1175    Thank you for the opportunity to advocate for these1176important reforms, and I stand ready to assist the committee or1177answer any questions as well.11781179    [The Prepared Statement Of Edward O'Bryan Appears In The1180Appendix]11811182    Ms. Kiggans. Thank you, Dr. O'Bryan. The written statement1183of Dr. O'Bryan will be entered into the hearing record.1184    We will now proceed to questioning, and I recognize myself1185for 5 minutes.1186    Mr. Lyle, what is a recent example of a more sophisticated1187and complex scam toward veterans that the American Legion is1188aware of?1189    Mr. Lyle. Thank you, Chairwoman Kiggans. I could take that1190for the record and get back with a specific case or two. I will1191say that the Federal Trade Commission (FTC) has noted a recent1192uptick in identity theft and other forms of financial crimes in1193the military and veteran communities.1194    I will also just note that for the Consumer Sentinel1195Network Data Book in the most recent report released this year,1196the military community lost 25 percent more by scammers for1197year 2024 than the year before, totaling up to a 584 million1198dollar loss.1199    Ms. Kiggans. Do you hear from your members that they are1200actually receiving information from the VA about how to prevent1201or protect themselves from this type of fraud and the1202prevention efforts that the VA has in place? Are they receiving1203that information?1204    Mr. Lyle. I will have to take that for the record.1205    Ms. Kiggans. I am just curious if they are at least aware1206of some of the efforts. Could you explain the Legion's position1207on what improved accountability measures at the VA would do for1208veterans' trust?1209    Mr. Lyle. I think, generally speaking, we want a VA that is1210accountable to the veterans that they serve. I think the legion1211has historically supported multiple efforts to increase1212accountability at the VA. There have been many instances.1213Again, I can follow up and provide specific cases where1214Legionnaires across the country have experienced issues with VA1215providers who were then transferred to another facility or they1216were given another appointment with another VA provider because1217of those issues. I can follow up with some specifics.1218    Ms. Kiggans. Is there anything that the American Legion1219specifically is doing for veterans to prevent them from being1220victims of frauds? Or do you refer them to a certain1221organization if they come to you with these problems?1222    Mr. Lyle. We have several thousand veteran service officers1223across the country who routinely interact with veterans on the1224ground at the local post level to help them identify resources,1225obviously, to help prevent the fraud before it happens in the1226first place, identify scams, but then also, again, if they fall1227victim to one of these scams work with the VA to provide relief1228for that or debt waivers for veterans.1229    Ms. Kiggans. Does the VA have a reporting system or a data1230base that you can report to the Department of Veteran Affairs1231so that they can be on the lookout for these potential scams1232that may be affecting other localities as well?1233    Mr. Lyle. I know the VA routinely puts out information for1234veterans, you know, in multiple different ways. I am not aware1235of a specific data base but I can take that for the record as1236well.1237    Ms. Kiggans. That would be another good idea for us to1238think about but thank you. Then last question for Mr. Lyle,1239does it concern you that the OIG has characterized the VA's1240national ordering system as unsustainable? How does this1241contribute to waste, fraud, and abuse at the VA?1242    Mr. Lyle. I believe you are referring to H.R. 3494 with the1243OIG complaints. There have been multiple instances,1244particularly in I think the Medical Center in Houston, across1245the country of waste and abuse in the supply chain.1246    I think this bill in particular one of the reasons we1247support it is, as the VA noted, I think the savings that the VA1248would garner based on the implementation of this bill to1249prevent that level of waste and abuse in the supply chain1250system would not only benefit taxpayers but veterans themselves1251because oftentimes you see some of these supply chain issues1252can lead to delayed surgeries or care.1253    Ms. Kiggans. I agree.1254    Let us see. I will now yield 5 minutes to the ranking1255member for her questions.1256    Ms. Ramirez. Thank you, Chairwoman. I am thankful to the1257witnesses that are here with us today and even more thankful1258Representative Gray was able to join us today as he is the1259sponsor of the only one Democratic bill on today's agenda and1260one that seeks to alleviate unnecessary financial burdens that1261may serve as a barrier to veterans' health care access.1262    Dr. O'Bryan, I have a question for you. Your testimony1263highlights research to this point. How might waiving co-pays in1264certain situations increase health care utilization for1265vulnerable populations?1266    Dr. O'Bryan. Thank you for the question. I have seen first-1267hand a lot of patients not fill prescriptions because of co-pay1268concerns, you know, not seek care, not seek specialist care and1269so that is a real issue, you know.1270    Then the whole concept of co-pay, obviously, was put forth1271kind of to decrease utilization back in the day, you know?1272    The second aspect was to have other people have skin in the1273game, right? My concept is I think the veterans already have1274skin in the game by serving so the more we can do to get rid of1275the co-pays for the veterans the better.1276    Ms. Ramirez. I agree with that. Thank you, Dr. O'Bryan.1277    Mr. Lyle, thank you for joining us today again as our (VSO)1278Veterans Service Organization representative. I was happy to1279see the American Legion support H.R. 3812. What impact would1280the passage of the STRIVE Act and the reduction of delayed co-1281payments have for the Legion's membership?1282    Mr. Lyle. Well, thank you, Ranking Member Ramirez. I1283appreciate the question. The American Legion has multiple1284overseas departments that we have conducted system-wide saving1285visits, regional office action review visits of different1286sites, identify best practices, talk about the biggest1287challenges so they do not become systemic issues.1288    I think the ability to provide care in those remote areas1289would be strengthened by provisions in this particular bill,1290particularly considering that in some areas in Puerto Rico, for1291example, the staffing for VA providers at those facilities have1292decreased by, I think, 40 percent after those incidents. I1293think it could help significantly for delivery of care.1294    Ms. Ramirez. Thank you, Mr. Lyle. I have another follow-up1295question for you. The discussion draft to modernize the1296electronic health record before us maintains language that1297prevents the inappropriate use or monetization of veterans'1298protected health information or we say PHI cause we love1299acronyms and personalized identified information.1300    My question to you is how important is it that this1301language remain in this bill? Could you elaborate on the1302significance of protecting veteran data and its implications1303for the American Legion's membership?1304    Mr. Lyle. Absolutely. Thank you again, Ranking Member1305Ramirez. We just had a conversation about the increased1306likelihood of veterans to be taken advantage of by scams.1307Obviously, the increased or the not protecting veteran data1308increases the likelihood that their personally identifiable1309information, particularly in health care, could get misused and1310negatively impact not only their health care and benefits1311delivery but their psychological care and stress that they1312would undergo from their data being sold to third parties.1313    Ms. Ramirez. Yes. No, thank you for that. I just want to1314note before I ask a couple more questions, I agree with you. It1315is extremely important that as we move forward with1316modernization efforts that we ensure that we are protecting all1317of the information of our veterans, especially in this instance1318when, to your point, you are constantly victims of a number of1319scams and frauds and especially some of our senior veterans who1320are experiencing this on a regular basis. Thank you for that.1321    Dr. O'Bryan, I want to come back to you. I was impressed to1322see the work that the VA and the Medical University of South1323Carolina have performed in decreasing scheduling wait times1324utilizing the external provider scheduling system. One of the1325challenges we have heard with some of the EPS sites is the1326awareness and engagement aspect with community providers.1327    How many MUSC, Medical University of South Carolina,1328providers are engaged in sharing their schedules with VA?1329    Dr. O'Bryan. Prior to this May there was about a hundred,1330but we added 300 so now there is about 410 or 15 currently.1331    Ms. Ramirez. Four hundred and what?1332    Dr. O'Bryan. About 415 providers currently.1333    Ms. Ramirez. Got it. One last follow-up question for you.1334How might the department improve their outreach efforts into1335the community care provider network to ensure success in the1336scheduling tool?1337    Dr. O'Bryan. That is a great question. The fact that I am,1338kind of, in charge of this veteran's aspect and was unaware of1339it, yes, is interesting. I think maybe even having a liaison to1340go at least to these large academic centers, right, in these1341states where most of the doctors are concentrated and at least1342provide awareness there to start makes sense to me.1343    Ms. Ramirez. Thank you, Dr. O'Bryan.1344    Chairwoman, I yield back.1345    Ms. Kiggans. The chair now gives 5 minutes to Mr. Barrett1346for questions.1347    Mr. Barrett. Thank you, Madam Chair.1348    To the panelists, thank you for being here today. I wanted1349to discuss with you the bill that I introduced, the Veterans1350Community Care Scheduling Improvement Act. This would really, I1351hope, benefit veterans on the community care side who are1352looking to schedule appointments in a timely manner.1353    I have the privilege of chairing the Subcommittee on1354Technology and Modernization. We heard testimony about this and1355how it is inconsistent throughout the VA and that it is not1356widely rolled out in as many VA hospitals as we would like,1357leading to inefficiencies with how veterans will schedule care1358that they are required.1359    Sometimes that will be most timely and efficient within the1360VA network, other times it will be more timely and efficient1361outside. It might be closer to home and whatnot through the1362community care program.1363    Dr. O'Bryan, I wanted to start with you for a moment. You1364mentioned in your testimony that EPS cut down veteran wait1365times by 9 days in the area that you serve. Can you tell us how1366that has worked and what the kind of success is attributed to?1367    Dr. O'Bryan. Sure. I think the first I will say avenue of1368success is when we have a really great system or team at the VA1369themselves who we work directly with, who I used to work with1370in the emergency department, actually, a group of nurses who1371are aware of the amount of providers that we have at MUSC.1372    As we have added providers to the system there is more1373opportunity to schedule veterans geographically and/or by1374specialists within our system.1375    Mr. Barrett. Yes. I know that this is a two-way street1376where the VA has the scheduling ability. They have systems that1377will allow them to see the availability on the provider side1378outside of the VA, and there has to be some reciprocal sharing1379of information that way.1380    Did you find that process to be difficult at all for, you1381know, for your organizations you were trying to get this done?1382    Dr. O'Bryan. I would say the new process that I am familiar1383with is a million times better than the old way of fax1384machines. We were physically taking paperwork back and forth1385before.1386    Mr. Barrett. Okay, thank you. Then based on what you have1387seen, do you believe the VA should be required to track how1388much time and money is saved with tools like EPS?1389    Dr. O'Bryan. Yes.1390    Mr. Barrett. Okay. Would setting performance goals help1391hold the department accountable in your opinion?1392    Dr. O'Bryan. I think so.1393    Mr. Barrett. Okay, very good. Thank you.1394    Mr. Lyle, appreciate you being here. I am a life member of1395the American Legion. Invite you out to Howell sometime in my1396district. We have a great post there and we would love to have1397you some time as a guest. Thank you for the American Legion's1398support of this bill.1399    Do you believe veterans would get faster care if VA1400schedules and not just the contractors that set these1401appointments have the tools to book appointments directly with1402outside providers?1403    Mr. Lyle. Yes is the short answer to that question.1404Scheduling since the Mission Act has been one of the main1405challenges of implementing community care, obviously, at the1406VA. In this bill particularly, the American Legion was1407encouraged to see that the secretary could utilize an already1408existing contract and we are aware of the EPS contract while I1409have been employed that has been very successful, as I pointed1410to in the opening statement.1411    I think the implementation just requires increasing1412communication with new areas to ensure that providers are1413trained to be able to use the system. Very encouraging data and1414results from that program, and I think it helps eliminate one1415of the main issues with the community care program.1416    Mr. Barrett. Yes. I had a referral myself for a audiology1417appointment at the VA not long ago, and a provider, a vendor1418called because it got basically outsourced from the VA and they1419asked me my availability. I gave them some times. Of course, I1420travel back and forth here to Washington most weeks and I had1421dates that I was not available back home.1422    I gave them those dates I was not available, and they1423called me back, I do not know, the next day and scheduled me an1424appointment on a date I was not going to be in Michigan. That1425necessitated me to then call into the call line and, you know,1426clogging up the phone lines for somebody else that also wants1427to call in and schedule something inefficiently.1428    I told them my situation and they said, ``Oh, well, we1429could not accommodate your scheduling request so our process we1430follow is we just give you the next available appointment.'' I1431was, like, well the next available appointment on a day I am1432600 miles from home does not actually accommodate the needs1433that I have.1434    It is not about, you know, scheduling me the next1435available. It is finding the time that works for me. It was a1436very inefficient methodology that, kind of, you know, in a1437personal sense exposed some of this. I was able to see, and I1438am hopeful through doing this bill and the follow through with1439that that it will help, you know, prevent that inefficiency1440from becoming problematic for the veterans.1441    With that, I am out of time, and Madam Chair, I yield back1442and appreciate the ability to ask questions today.1443    Ms. Kiggans. Thank you.1444    The chair now recognizes Ms. Mace for 5 minutes.1445    Ms. Mace. Thank you, Madam Chair, for allowing me to waive1446onto this hearing today.1447    I want to thank you to our witnesses who are appearing1448before our Veterans Affairs Subcommittee.1449    Distributed technology like blockchain has the potential to1450create an unchangeable, auditable trail of interactions1451allowing VA systems to verify claims more efficiently, reduce1452duplicate records, and track services and payments with1453precision. If leveraged properly, this could mean faster and1454more accurate decisions and reduced costs.1455    My bill H.R. 3455, the Veterans Affairs Distributed Ledger1456Technology Innovation Act, would direct the secretary of1457Veterans Affairs to study how distributed ledger technology1458like blockchain could improve the veterans' claims adjudication1459process and help prevent waste, fraud, and abuse in the1460administration of veterans' benefits.1461    We owe it to our vets to process their claims quickly and1462efficiently. We also owe it to our citizens to ensure their1463money is spent wisely. This bill would examine how leveraging1464distributed ledger technologies such as blockchain could help1465us meet both of these objectives.1466    I want to extend a special thank you to the Medical1467University of South Carolina's Dr. O'Bryan for being here1468today. MUSC's work in South Carolina has a tremendous impact on1469our veterans and on our State.1470    MUSC is one of the premier academic and health care1471institutions in the country and continues to set the bar for1472patient care, research, and training. I appreciate your work at1473the Ralph H. Johnson Medical VA Center. I have family who have1474been treated there for years, and they do a fine job of1475protecting our veterans.1476    I will readily admit, even as the daughter of a veteran, I1477do not always know what programs are available to my family1478members and so we do have some work to do.1479    My first question is going to go to Mr. Carbone today. Why1480should Congress consider distributed ledger technology for1481modernizing veteran services? How does it compare to the legacy1482systems that are in play today?1483    Mr. Carbone. Thank you for the question, Congresswoman, and1484thank you for your leadership on this bill. I think you said it1485best. Veterans deserve our best and the legacy systems,1486frankly, just have not met the moment. We have seen that with1487some of the delays in some of the GI Bill processing benefits.1488    Ms. Mace. Yes.1489    Mr. Carbone. Right now, legacy systems are siloed. They are1490fragile, and they are unable to scale with the modernization1491that the VA needs. What blockchain can do is cut down on some1492of those silos and maybe cut down some of those central points1493of failure. It puts everything on a unified shared ledger that1494is transparent and auditable, and I think it will really help1495automate the processes we have today.1496    Ms. Mace. What about fraud and abuse? How can we use1497blockchain to reduce the amount of fraud and abuse?1498    Mr. Carbone. Well, that is one of the beauties of1499blockchain. It is immutable and it is transparent and so it is1500almost impossible to have fraud on there. Those different1501instances of fraud or abuse will be checked immediately and1502there will be multiple people who have access to the1503distributed ledger to understand where they are coming from to1504cut those immediately.1505    Ms. Mace. Explain to those who may not be familiar with1506blockchain technology, how is it impossible?1507    Mr. Carbone. When there is a input to the distributed1508ledger that goes in every single node or computer that has1509access to the technology and sees that that input has been made1510so it is and auditable and transparent.1511    At the same time, if there is any other additional input or1512if there are any falsified records, every single person who has1513access to the network would have to confirm that that input is1514legit.1515    If you have, you know, the only way to really tamper with1516the blockchain or to submit some kind of fraudulent claim is if1517every single person who has access to the network and everyone1518who has oversight across the VA decides that that was1519inaccurate input.1520    Ms. Mace. Okay, great.1521    Then I have a question for Dr. O'Bryan. Can you speak to1522some of the innovative ways MUSC is improving care for our1523veterans in South Carolina?1524    Dr. O'Bryan. Oh, sure. I would say one big one is we are1525building--we have a comprehensive cancer center and we are1526expanding the geography of our cancer center throughout the1527State to be within the geographic radius of where our veterans1528are needed. I think that is one of the big ones.1529    Ms. Mace. Great. I have 1 minute left, so I am going to ask1530a question, same question of all three of you. If there was one1531thing that you could do today for our veterans, just one thing,1532could be small, could be big, but what is the one thing you1533would do?1534    Dr. O'Bryan, you are first. It is not a trick question. One1535thing.1536    Dr. O'Bryan. I might in trouble for this. I would probably1537give the world's greatest insurance.1538    Ms. Mace. Mr. Lyle.1539    Mr. Lyle. The American Legion testified in our legislative1540priorities that we would like to see VA's approach to suicide1541prevention change and not just be through the lens of mental1542health because suicide is not always just a mental health1543problem. It is usually a conglomeration of different issues, so1544big picture change how we look at suicide and adjust programs1545accordingly.1546    Ms. Mace. Mr. Carbone.1547    Mr. Carbone. Pass modernization legislation to ensure that1548benefits are paid out within seconds and minutes, and not days,1549weeks, and months.1550    Ms. Mace. Or years. Thank you, Madam Chair, and I yield1551back.1552    Ms. Kiggans. Thank you very much.1553    Thank you to all of our witnesses for attending this1554hearing and providing testimony to improve several of these1555bills. I appreciate the comments and suggestions from both the1556first and second panels.1557    As I said previously, our work on the subcommittee relies1558on dialog and consultation with experts who have immediate1559insight into how these legislative fixes will impact veterans'1560lives.1561    Thank you to our colleagues from the Technology and1562Modernization Subcommittee for their great work in improving1563the digital infrastructure at VA.1564    Finally, thank you to the members who waived on for this1565legislative hearing to speak about their bills and the1566importance of getting things right for veterans. I look forward1567to further discussions on how we may continue to improve the1568proposals that we received testimony on today.1569    With that, I yield to the Ranking Member for her closing1570statement.1571    Ms. Ramirez. Thank you, Chair Kiggans.1572    I want to thank all of the witnesses that were here in both1573first and second panel. All the testimoneys today, especially1574VA's point in that this committee needs more conversations on1575these bills before they are ready for advancement.1576    These programs from the electronic health record and supply1577chain to appointment scheduling and fraud, waste, and abuse1578detection are too critical to VA's operations and our veterans'1579quality of care for us to rush forward with incomplete plans.1580    We as a committee of jurisdiction must sit down with1581stakeholders and make the necessary changes to ensure each one1582of these bills is ready for the VA to implement soundly and as1583effectively as possible.1584    I hope we can find time to have these conversations before1585the markup before we mark up this legislation, and I do1586appreciate the follow up that I will be getting from the VA on1587a number of items that I requested in the first panel.1588    With that, Chair, I yield back.1589    Ms. Kiggans. Thank you again to our witnesses for being1590here today. I ask unanimous consent that all members shall have15915 legislative days in which to revise and extend their remarks1592and include any extraneous material. Hearing no objections, so1593ordered.1594    This hearing is now adjourned.1595    [Whereupon, at 3:38 p.m., the subcommittee was adjourned.]1596=======================================================================15971598                         A  P  P  E  N  D  I  X15991600=======================================================================16011602                    Prepared Statements of Witnesses16031604                              ----------16051606                  Prepared Statement of Cherri Waters1607[[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]16081609                Prepared Statement of Jennifer McDonald16101611    Chairwoman Kiggans, Ranking Member Ramirez, and members of the1612Subcommittee, thank you for the opportunity to testify on the1613independent oversight conducted by the Office of Inspector General1614(OIG) on the pause taken by the Veterans Health Administration (VHA) in1615using its Program Integrity Tool, which relates to one of the bills1616before you. Our testimony was requested by the subcommittee on this1617tool because the ``FRAUD Act of 2025'' requires VA ``to use an1618information technology (IT) system to detect fraud, waste, and abuse''1619within community care claims, and the Program Integrity Tool has1620previously served this function in a limited capacity. The OIG's work1621has outlined the significant hindrances the Program Integrity Tool's1622pause has had on VHA's revenue collection processes and on the1623detection and mitigation of fraud and waste related to the delivery of1624community care.1625    Many of the bills under consideration also require VA to develop or1626improve IT systems. IT modernization has consistently been a major1627management challenge for VA. The OIG has repeatedly conducted audits,1628reviews, and inspections that identify deficiencies in how VA plans,1629implements, and remediates identified weaknesses in these efforts. This1630statement, therefore, also touches on the OIG's oversight of many VA1631critical systems and modernization initiatives.16321633BACKGROUND16341635    The Program Integrity Tool is a system that consolidates data from1636multiple VA community care programs. It is a repository of post-payment1637claims. For revenue operations, VHA uses the data to determine if1638veterans or their private insurance companies should be billed for care1639that is not connected to injuries or conditions related to their1640military service.\1\ To support VHA's fraud and waste detection and1641mitigation efforts, data from the tool can be used to identify1642duplicate claim payments or indicators of potential fraud, such as1643payments to providers across different community care programs in1644different locations on the same day.1645---------------------------------------------------------------------------1646    \1\ Under 38 U.S.C. Sec.  1729, the United States has a right to1647recover from third parties the cost of medical care and treatment1648furnished by the United States. In addition, 38 C.F.R. Sec.  17.101,1649the Collection or Recovery by VA for Medical Care or Services Provided1650or Furnished to a Veteran for a Non-Service Connected Disability,1651provides for recovery from private insurance by VA for medical care1652that was unrelated to veterans' military service. VA is not able to1653recover the cost of medical care for veterans who do not have private1654health insurance.1655---------------------------------------------------------------------------1656    As detailed in this statement, VHA's Office of Integrity and1657Compliance, in collaboration with VA's Office of Information and1658Technology, paused operations of the Program Integrity Tool in February16592023, after becoming aware of ongoing issues with its data base logic1660and unreliable data. The pause was intended to allow VHA time to1661evaluate the tool's processes, data, documentation, and underlying1662information technology system architecture, and to determine the cause1663of any data errors and identify improvement opportunities.1664    In July 2024, the OIG issued a management advisory memorandum to1665the under secretary for health to highlight the major impacts of the1666tool's pause on VHA's revenue collection processes, as well as on1667identifying fraud and waste related to community healthcare claims.\2\1668The memorandum provided VHA with information necessary to address the1669identified concerns. In its response, VA officials stated they had1670resumed using data from the Program Integrity Tool for revenue1671collection for community care claims but were still considering the1672path forward for the tool's oversight functions, including audit and1673compliance efforts. The information that follows highlights1674deficiencies identified with the tool's data integrity and accuracy and1675the impact of the pause on both VHA and the OIG's oversight work.1676---------------------------------------------------------------------------1677    \2\ VA OIG, The Pause of the Program Integrity Tool Is Impeding1678Community Care Revenue Collections and Related Oversight Operations,1679July 16, 2024. The OIG issues management advisory memoranda when1680exigent circumstances or areas of concern are identified by OIG hotline1681allegations or during its oversight work, particularly when immediate1682action by VA can help reduce further risk of harm to veterans or1683significant financial losses.16841685---------------------------------------------------------------------------1686Community Care Provider Management16871688    Through the Veterans Community Care Program, VHA buys care from1689local providers for veterans through network contracts managed by two1690third-party administrators (TPAs). These TPAs develop and administer1691the network of community healthcare providers. TPAs are also1692responsible for paying those providers and then seeking reimbursement1693from VHA. When services are unavailable or insufficient to meet the1694needs of veterans through the network, however, VA medical facilities1695may directly establish veteran care agreements with area clinicians. VA1696also has Veteran Family Member Programs, for which VA shares the cost1697of certain community healthcare services for eligible family members.1698Finally, VHA's HealthShare Referral Manager generates referrals and1699forwards authorizations to community providers. The related claims and1700referral data from these systems flow into the Program Integrity Tool.1701    Typically, a community care provider submits a claim through the1702TPAs or VHA's electronic system or by paper after care is provided. The1703claim is then either paid for by TPAs for network providers (who are1704then reimbursed by VA) or by VA for facility direct care agreements.1705Once the claims are paid, VA then bills any copayment to the veteran,1706or the veteran's private health insurer if the care is unrelated to a1707service-connected condition.\3\1708---------------------------------------------------------------------------1709    \3\ VHA will not charge a copayment for treating health conditions1710that are related to military service, catastrophic disabilities, or1711other specified factors.1712---------------------------------------------------------------------------1713    Several VA offices are involved in the payment for community care1714and collections from veterans and their insurers:17151716      VHA's Office of Integrated Veteran Care coordinates1717veterans' access to community care services by developing and1718overseeing contracts for veterans' healthcare services and payments to1719TPAs.17201721      VHA's Revenue Operations Division (within the Office of1722Finance) bills and collects from veterans and private insurers for1723copayment and coinsurance obligations through a centralized process1724that requires data from the Program Integrity Tool. Staff from VHA's1725Consolidated Patient Account Centers perform the billing and revenue1726collection operations for non-service-connected treatment using data1727from the tool.17281729      VHA's Office of Integrity and Compliance is the business1730owner of the Program Integrity Tool and uses its data for the1731prevention, detection, and mitigation of fraud, waste, and abuse.17321733      VA's Office of Information and Technology is responsible1734for developing, approving, and implementing system security baseline1735configurations for all VA data platforms and systems. Its staff oversee1736all data integrity issues and updates to the Program Integrity Tool,1737including a product manager that oversees the tool's day-to-day1738operations.17391740    Those offices' data, which relate to community care claims,1741referrals, and the family member program, flow into the Program1742Integrity Tool from six different source systems:17431744    Community care claims processing engages three payment systems:17451746        1. The Plexis Claims Manager for older community care program1747        claims17481749        2. The Community Care Reimbursement System for more recent1750        community care network claims17511752        3. The Electronic Claims Adjudication Management System for1753        direct veteran care agreement claims17541755    Referrals use a single system:17561757        4. The VHA HealthShare Referral Manager moves data for1758        community care referrals into the Program Integrity Tool.\4\1759---------------------------------------------------------------------------1760    \4\ VA uses the HealthShare Referral Manager to generate referrals1761and forward authorizations to community providers.17621763    Veteran Family Member Programs' paid claims data flow to the tool1764---------------------------------------------------------------------------1765from two systems:17661767        5. The Customer Experience Manager17681769        6. Claims Processing and Eligibility, a legacy system that1770        processes older claims17711772    The Program Integrity Tool then feeds all these data to VA's1773Corporate Data Warehouse, from which VHA's Revenue Operations Division1774can access the data to use for veteran and private insurer billing. The1775tool also provides information for the Office of Integrity and1776Compliance's oversight efforts.17771778PROGRAM INTEGRITY TOOL DEFECTS17791780    The Program Integrity Tool went offline on February 21, 2023, to1781address identified issues, including (1) claims being entered1782inaccurately, (2) a defective code that added outpatient data to1783inpatient claims, and (3) duplicate claims. VHA had detected some of1784these issues as early as January 2022.\5\1785---------------------------------------------------------------------------1786    \5\ The former VHA Office of Community Care's Division of Program1787Integrity was responsible for the Program Integrity Tool in January17882022 and discovered the problems. This responsibility was transferred1789to the Office of Integrity and Compliance in November 2022, following1790the establishment of VHA's Office of Integrated Veteran Care, and then1791moved permanently to VHA's Office of Integrity and Compliance in March17922023.1793---------------------------------------------------------------------------1794    Officials from VHA's Office of Integrity and Compliance1795collaborated with the Office of Information and Technology to assess1796problems, resolve them, and develop system improvements. During the1797pause, the Program Integrity Tool could not be used for billing1798veterans and private insurers or to assist in the prevention,1799detection, and mitigation of fraud, waste, and abuse.1800    In addition, in November 2023, the Office of Information and1801Technology completed a review of the Program Integrity Tool and1802identified 18 defects in total, including eight high-priority issues1803and one critical issue with the Veteran Family Member Programs' claims1804data overwriting other claims data. For example, multiple claims were1805assigned the same claim identifier when each claim should have had a1806unique identifier. At that time, VHA reported it had begun upgrading1807the tool's servers, corrected the defective line of code associated1808with inpatient claims, and identified solutions for duplicate claims.1809    In July 2024, the OIG issued the management advisory memorandum1810that highlighted the major impacts of the tool's pause on VHA's revenue1811collection processes and oversight of community care claims.1812    Also in July 2024, VHA officials told the OIG that they had brought1813the Program Integrity Tool back online on a limited basis for only1814revenue collection operations for community care claims.1815    The OIG had reported in 2022 on VHA's challenges billing private1816insurers for community care.\6\ Because a fully functioning Program1817Integrity Tool was necessary for VHA to satisfy the intent of the open1818recommendations from that report, the OIG paused its regular quarterly1819follow up (conducted on all recommendations from its oversight reports)1820while the tool was offline. In late 2024, OIG staff resumed follow up1821on these open recommendations and VHA has been providing status updates1822on their efforts to ensure the Program Integrity Tool is fully1823operational. Recommendations 2 and 3 are still open that relate to (2)1824strengthening system controls to ensure complete and accurate claims1825information is transferred between applicable tools, systems, and1826patient files and (3) assessing whether there is sufficient staffing to1827process the anticipated volume of claims to be billed to veterans'1828private health insurers and make needed adjustments. The impacts of the1829pause and unresolved issues have been significant, as detailed in the1830following sections.1831---------------------------------------------------------------------------1832    \6\  VA OIG, VHA Continues to Face Challenges with Billing Private1833Insurers for Community Care, May 24, 2022.18341835The Pause Precluded Revenue Operations from Timely Billing for1836---------------------------------------------------------------------------1837Community Care18381839    Because VHA Revenue Operations use the tool's information to bill1840veterans and private insurers for copayments for community care, they1841had not been billed between February 2023 and July 2024, when VA1842resumed some functionality. During the period of the OIG's review, the1843Program Integrity Tool pause affected VHA's ability to collect1844potential revenue from veterans and private insurers for approximately184540 million community care network and veteran care agreement program1846claims that VHA paid to care providers.\7\1847---------------------------------------------------------------------------1848    \7\ The OIG review of paid community care claim data from VA's1849Corporate Data Warehouse was conducted from February 1 2023, through1850January 31, 2024, for veteran care agreements, and from February 2,18512023, through February 1, 2024, for community care network claims.1852Additional community care claims would have been paid between March and1853July 2024 and are not included in the estimate. It is important to note1854that the actual payment of claims to providers has not been affected by1855the pause because, as mentioned earlier, the Program Integrity Tool1856receives claims following care provider payments. It does affect VA's1857revenue collection.1858---------------------------------------------------------------------------1859    As the Program Integrity Tool returns to full functionality,1860Revenue Operations will have to resolve the backlog of paid claims to1861identify and bill veterans for copayments. VHA has acknowledged this1862may negatively affect veterans because they could receive copayment1863bills that are over a year old. Revenue Operations leaders told the OIG1864that they are working with VHA and the VA Office of General Counsel to1865implement a regulatory change allowing VA to apply for debt waivers on1866behalf of veterans when debts are accrued due to the fault of the1867agency. If approved, this regulatory change would help VA to avoid1868unnecessarily burdening veterans with substantial debts that accrued1869due to a faulty VA tool.1870    The OIG applied VHA's established collection-to-billing ratio for1871medical care collections to estimate the proportion of claims that1872would have been billable to insurance. This ratio approximates the1873average amount VHA will collect for each dollar billed to private1874insurers. The OIG estimated that the Program Integrity Tool's pause has1875resulted in approximately $665.5 million in Revenue Operations1876collections that had not been recovered from February 1, 2023, through1877February 1, 2024. Since VHA has resumed using the tool, Revenue1878Operations must handle these older claims in addition to working on the1879new claims they will receive. Many of these delayed claims may exceed1880the deadlines for insurance companies to be required to reimburse VHA,1881further limiting VA's ability to make up the lost revenue.18821883The Pause Hindered the Prevention, Detection, and Mitigation of Fraud,1884Waste, and Abuse18851886    According to VHA Office of Integrity and Compliance officials,1887their oversight efforts for community care programs and for Veteran1888Family Member Programs' claims have been impeded by the Program1889Integrity Tool's pause. As for detecting healthcare provider fraud,1890waste, and abuse, the pause resulted in a halt to generating real-time1891views of behavioral indicators and patterns or to running data and1892reports to support investigations, research, and remediation. Although1893the Office of Integrity and Compliance said it had access to an1894archived version of the tool containing data before February 2023, VHA1895staff do not recommend using it due to errors related to the incorrect1896sequencing of data. Thus, VHA has been limited in its ability to1897support the investigation of ongoing fraud allegations and referrals.1898This means the Office of Integrity and Compliance will have a backlog1899of data to review for fraud, waste, and abuse detection, OIG referral,1900and mitigation efforts when the tool resumes operations that support1901oversight. The OIG understands VHA is still taking steps to bring the1902oversight functions back online or to replace the tool.19031904OTHER OIG OVERSIGHT OF VA SYSTEMS AND MODERNIZATION EFFORTS19051906    Issues with the Program Integrity Tool are symptomatic of the1907larger concern with VA's continued challenges with implementing complex1908modernization efforts. As our report on VA's major management1909challenges has stated, VA is undertaking massive efforts to upgrade or1910replace systems that are estimated to cost tens of billions of dollars1911and are interdependent--making implementation both costly and complex.1912The OIG encourages innovation and recommends enhancements to VA's1913infrastructure and systems through practical findings and1914recommendations. VA relies on countless systems to meet the needs of1915patients safely and promptly, to provide benefits and services to1916eligible recipients, and to support the strong stewardship of taxpayer1917dollars. Information system failures have contributed to breakdowns in1918a number of critical VA functions, including the new electronic health1919record system, financial reporting, disability benefit claims1920processing, and supply chain management, as well as appointment1921management, community care prescription requests, and personnel1922suitability adjudications. The OIG has identified extensive breakdowns1923with upgrading or replacing these key systems and failures in strong1924stewardship of taxpayer dollars.\8\1925---------------------------------------------------------------------------1926    \8\ The following is a sample of the many recent VA OIG reports on1927VA systems and modernization efforts: VA OIG, VBA's Special Monthly1928Compensation Calculator in the Veterans Benefits Management System for1929Rating Did Not Always Produce Accurate Results, May 29, 2025; VA OIG,1930Community Care Network Outpatient Claim Payments Mostly Followed1931Contract Rates and Timelines, but VA Overpaid for Dental Services,1932February 20, 2025; VA OIG, Improved Oversight Is Needed to Correct1933VISN-Identified Deficiencies in Medical Facilities' Supply Chain1934Management, September 12, 2024; VA OIG, Lessons Learned for Improving1935the Integrated Financial and Acquisition Management System's1936Acquisition Module Deployment, July 10, 2024; VA OIG, Ineffective Use1937and Oversight of Medical/Surgical Prime Vendor Program Led to Increased1938Spending, June 11, 2024; VA OIG, Improvements Needed for VBA's Claims1939Automation Project, September 25, 2023; VA OIG, Additional Actions1940Needed to Fully Implement and Assess the Impact of the Patient Referral1941Coordination Initiative, October 27, 2022.1942---------------------------------------------------------------------------1943    VA's process deficiencies have typically included inadequate1944planning and requirements development, insufficient stakeholder1945engagement, failures to promptly fix known issues, and program1946management or coordination lapses. The results have been long delays,1947cost overruns, low user acceptance, and gaps in functionalities that1948make it more difficult for VA personnel to do their jobs. The OIG1949understands the complexity of these efforts and acknowledges the great1950lengths staff go to every day to develop work-arounds as needed. Below1951are a few examples of the OIG's oversight of VA modernization efforts.1952    The OIG has continued its work on the Electronic Health Record1953Modernization (EHRM) program. The EHRM is probably the largest contract1954in VA history and critical to continued patient safety and care. Since1955April 2020, the OIG has released 22 oversight publications on VA's1956rollout of its electronic health record system that identified critical1957missteps and lack of remediation.\9\ In several reports, the OIG1958highlighted a variety of barriers to implementation, including patient1959harm and safety concerns; pharmacy and medication management issues;1960inadequate cost estimates; an unreliable implementation schedule;1961difficulties with the patient appointment scheduling system; and1962reporting, training, and decision-making deficiencies. OIG reports also1963stressed the need for VA to make certain that the system is stable and1964can handle future growth without the kind of outages and service1965degradations previously experienced. OIG teams will also continue to1966monitor system improvements in areas such as supply chain management1967and appointment scheduling, with a keen focus on patient care and1968safety, VA staff's ability to efficiently do their jobs, and making the1969most effective use of taxpayer dollars.1970---------------------------------------------------------------------------1971    \9\ All other OIG reports may be found on the website at All1972Reports.1973---------------------------------------------------------------------------1974    Furthermore, the OIG has issued numerous reports in recent years1975that have identified deficiencies with inventory management of supplies1976and equipment, in part due to VA's continued reliance on various1977outdated systems. VA still uses more than 60 disparate systems to1978manage its supply chains, which include billions of dollars in medical1979supplies and equipment inventory. VA's medical facilities have long1980experienced barriers to accurately tracking inventory, purchasing,1981distribution, storage, and other supply chain functions, leading to1982operational breakdowns and the need for workarounds that sometimes lack1983compliance with VA policies and procedures. Recent attempts to1984modernize its antiquated system have been unsuccessful as VA continues1985to try to address these longstanding supply chain concerns.19861987CONCLUSION19881989    The OIG routinely scrutinizes the effectiveness of the leadership1990and quality management of VA operations that makes the most efficient1991use of taxpayer dollars. In a department the size of VA, with the1992Nation's largest integrated public healthcare system, an aging1993infrastructure, and massive IT initiatives, the OIG must remain1994vigilant to all risks to veterans, their families, and survivors. This1995requires the use of sophisticated data analytics and modeling; being1996responsive to hotline contacts and other allegations of misconduct; and1997rigorous and continuous independent oversight. OIG staff monitor1998programs and operations for breakdowns in processes; noncompliance with1999mandates; failures to provide quality health care; and deficiencies in2000the delivery of benefits and services. In addition, the OIG advances2001accountability by conducting an expansive range of administrative and2002criminal investigations that include fraud, waste, and abuse of2003authority.2004    OIG oversight has spotlighted VA's IT system modernization efforts2005that have had persistent issues, typically including weaknesses in2006planning, failures to promptly fix known issues, and program management2007or coordination deficiencies. The problems identified with the Program2008Integrity Tool are a perfect example of this. While the tool was2009offline, VHA had limited ability to collect hundreds of millions of2010dollars of revenue from veterans' copayments or from private health2011insurers. VHA staff must grapple with a backlog of tens of millions of2012these community care claims that must be processed. Additionally, the2013Program Integrity Tool is still not being fully utilized for the2014prevention, detection, and mitigation of fraud, waste, and abuse for2015community care claims paid.2016    VHA will need to ensure that Revenue Operations has sufficient2017resources and processes to timely bill the backlog of community care2018claims now that the revenue operations to bill veterans and private2019insurers have been said to be resumed. It is also vital that the Office2020of Integrity and Compliance be ensured resources to perform timely2021fraud, waste, and abuse examinations of the backlog of community2022claims, to ensure the most efficient use of taxpayer dollars.2023    Madam Chair, this concludes my statement. I would be happy to2024answer any questions you or members of the subcommittee may have.20252026                    Prepared Statement of Cole Lyle2027[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]20282029                   Prepared Statement of Cody Carbone2030[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]20312032                  Prepared Statement of Edward O'Bryan2033[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]20342035                       Statements for the Record20362037                              ----------20382039                   Prepared Statement of Ken Calvert2040[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]2041                  Prepared Statement of Scott Franklin20422043    I'm honored to again introduce legislation to hold bad actors at2044the Department of Veterans Affairs accountable for misconduct,2045including sexual harassment. My bill, H.R. 3185, the Personnel2046Integrity in Veterans Affairs Act, would prohibit VA employees from2047evading accountability by simply resigning, retiring or transferring to2048avoid an investigation.2049    As a 26-year Navy veteran, former member of this Committee and2050current member of the House Appropriations Subcommittee on Military2051Construction and Veterans Affairs, I understand the importance of a2052strong and effective VA. That strength depends on holding every2053employee to the highest standards. Unfortunately, reports dating back a2054decade, along with recent whistleblower complaints, have exposed2055persistent issues with accountability and transparency within the2056Department.2057    In 2016, this Committee found that 96 percent of reviewed VA2058settlements failed to include proposed disciplinary actions in an2059employee's permanent record. More recently, in 2023, a whistleblower2060testified that senior VA leaders engaged in misconduct--including2061sexual harassment--without facing accountability.2062    This is deeply troubling and undermines the integrity of the2063Department. A change in culture is long overdue. My bill is needed to2064ensure investigations are completed, even if an employee departs before2065the process is complete. It also requires a permanent record of such2066investigations be included in the employee's official personnel file.2067    Misconduct has no place in the Federal Government, especially not2068within the Department of Veterans Affairs. Our veterans deserve a VA2069that enforces accountability at every level. There must be no loophole2070that allows individuals to avoid consequences.2071    This Committee passed the bill by voice vote last year. I again ask2072you to support this important measure to strengthen the VA. I was2073pleased to receive technical support from the VA on this bill, as they2074welcome the opportunity to strengthen their employee process as well. I2075thank the Committee for holding this hearing and look forward to2076working together to ensure the Department of Veterans Affairs serves2077our veterans with the excellence and accountability they deserve.20782079          Prepared Statement of Concerned Veterans for America2080[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]20812082                                 [all]