Veterans Health
 

Administration
 

Audit of the
 

Office of Rural Health
 

OFFICE OF AUDITS & EVALUATIONS

April 29, 2011 

10-02461-154 
ACRONYMS AND ABBREVIATIONS
 

CBOC Community Based Outpatient Clinic 

OIG Office of Inspector General 

ORH Office of Rural Health 

VAMC Veterans Affairs Medical Center 

VHA Veterans Health Administration 

VISN Veterans Integrated Service Network 

VRHRC Veterans Rural Health Resource Center 

To Report Suspected Wrongdoing in VA Programs and Operations:
 

Telephone: 1-800-488-8244
 

E-Mail: vaoighotline@va.gov
 

(Hotline Information: http://www.va.gov/oig/contacts/hotline.asp)
 
Report Highlights: Audit of the 

Office of Rural Health 

Why We Did This Audit What We Recommended
 

The Office of Inspector General (OIG) 

conducted this audit to assess whether the 

Veterans Health Administration’s Office of 

Rural Health (ORH) effectively planned and 

managed $533 million allocated to improve 

access and quality of care for veterans 

residing in rural areas during FYs 2009 and 

2010. 

What We Found 

The Veterans Health Administration needs 

to strengthen the management of rural health 

care funding to ensure that rural health 

projects meet ORH’s mission of improving 

access and quality of care for rural veterans. 

Specifically, we found ORH did not 

adequately manage the use of fee funds and 

the proposal selection process. 

Additionally, ORH did not monitor project 

obligations and performance measures. 

This occurred because of a lack of financial 

controls, the absence of policies and 

procedures to ensure staff followed 

management directives, and inadequate 

communication with key stakeholders. 

Also, ORH lacked a project monitoring 

system, procedures to monitor performance 

measures, and a process to assess rural 

health needs. As a result, ORH lacked 

reasonable assurance that its use of 

$273.3 million (51percent) of the 

$533 million in funding received during 

FYs 2009 and 2010 improved access and 

quality of care for veterans residing in rural 

areas. 

We recommended the Under Secretary for 

Health implement financial controls, 

establish management policies and 

procedures, and implement an effective 

communication plan. We also 

recommended the Under Secretary establish 

a project monitoring system, establish 

procedures to monitor performance 

measures, and reassess the FY 2012 budget 

for ORH to align planned use of resources to 

their greatest rural health needs. 

Agency Comments 

The Under Secretary for Health agreed with 

our finding, recommendations, and potential 

monetary benefits and plans to complete all 

corrective actions by October 2011. We 

consider these planned actions acceptable, 

and will follow up on their implementation. 

BELINDA J. FINN
 

Assistant Inspector General
 

for Audits and Evaluations
 

i 
TABLE OF CONTENTS
 

Introduction......................................................................................................................................1
 

Results and Recommendations ........................................................................................................2
 

Finding VHA Needs To Improve the Management of Rural Health Funding .................2
 

Appendix A Scope and Methodology................................................................................... 12
 

Appendix B Projects With Proposal Review Weaknesses ................................................... 14
 

Appendix C Potential Monetary Benefits in Accordance With Inspector General Act
 

Amendments .................................................................................................... 17
 

Appendix D Under Secretary for Health Comments............................................................ 18
 

Appendix E OIG Contact and Staff Acknowledgments....................................................... 28
 

Appendix F Report Distribution .......................................................................................... 29
 

ii 
Audit of the VHA’s Office of Rural Health 

Objective 

Office of Rural 

Health Program 

Management 

Office of Rural 

Health Strategic 

Plan 

Rural Veteran 

Population 

Funding 

INTRODUCTION 

This Office of Inspector General (OIG) audit assessed whether the 

Veterans Health Administration’s (VHA’s) Office of Rural Health (ORH) 

effectively planned and managed the allocation of funds designated for 

improving access and quality of care for veterans residing in rural areas. 

ORH, which is aligned under the Office of the Assistant Deputy Under 

Secretary for Health for Policy and Planning, is responsible for managing 

VHA’s rural health program. VHA created ORH in February 2007 to 

conduct rural health research and develop policies and programs to 

improve health care and services for rural veterans. ORH established 

three Veterans Rural Health Resource Centers (VRHRCs) to perform 

these functions and to serve as regional rural health experts. The three 

VRHRCs are located in White River Junction, Vermont; Iowa City, Iowa; 

and Salt Lake City, Utah. In addition, ORH coordinates with VHA 

program offices and Veterans Integrated Service Networks (VISNs) to 

enhance the delivery of services to rural veterans. 

ORH’s strategic plan defines and outlines six areas of focus they use to 

accomplish their mission of improving health care and services for rural 

veterans. 

1. Improve access and quality of care 

2. Optimize emerging technology 

3. Maximize utilization of existing and emerging studies and analyses 

4. Improve availability of education and training 

5. Enhance collaboration to increase service options 

6. Recruit and retain medical professionals 

As of September 30, 2009, ORH estimated 3.3 million enrolled veterans 

were living in rural areas, approximately 41 percent of all veteran 

enrollees. However, only about 2.2 million (67 percent) of the 3.3 million 

enrolled rural veterans used VHA services. Men and women from 

geographically rural areas make up a disproportionate share of service 

members and comprise about one-third (31.9 percent) of all Operation 

Enduring Freedom and Operation Iraqi Freedom enrolled veterans. 

In FYs 2009 and 2010, VHA received $533 million to improve health care 

for rural veterans. Specifically, in FY 2009, ORH received $250 million 

to implement new rural health outreach and delivery initiatives. In 

FY 2010, ORH received an additional $250 million for rural health care, 

$30 million to open 51 rural Community Based Outpatient Clinics 

(CBOCs) and $3 million for rural hiring initiatives. For FY 2011, VA is 

seeking $250 million to continue efforts to improve access and quality of 

care for veterans who live in rural areas. 

VA Office of Inspector General 1 
Audit of the VHA’s Office of Rural Health 

Finding 

Fee Care Project 

Funds 

Inadequately 

Managed 

RESULTS AND RECOMMENDATIONS 

VHA Needs To Improve the Management of Rural 

Health Funding 

VHA needs to strengthen the management of rural health care funding to 

ensure that rural health projects meet ORH’s goals of improving access 

and quality of care for rural veterans. Specifically, we found ORH did not 

adequately manage the use of fee funds and the proposal selection 

process. Additionally, ORH did not monitor project obligations and 

performance measures. This occurred because of the following program 

weaknesses. 

 Inadequate assessment and mitigation of financial risk 

 Lack of policies and procedures to ensure staff followed management 

directives 

 Inadequate communication with key stakeholders 

 Ineffective project monitoring system 

 Lack of procedures to monitor performance measures 

 Inadequate assessment of rural healthcare needs 

As a result, ORH lacked reasonable assurance that its use of 

$273.3 million (51 percent) of the $533 million in FYs 2009 and 

2010 funding improved access and quality of care for veterans residing in 

rural areas. 

ORH did not adequately manage funds provided to expand fee care for 

rural veterans. The U.S. Government Accountability Office’s Standards 

for Internal Control in the Federal Government states that controls are an 

integral part of an organization’s planning, implementing, reviewing, and 

accounting for Government resources and achieving effective results. 

Management controls, such as conducting risk assessments and 

implementing financial controls, are fundamental for identifying and 

addressing major performance and management challenges in the Federal 

Government. 

In March 2010, ORH provided $200 million of rural health funds to 

VISNs to cover fee expenditures for rural veterans through a project 

called the Rural Health Fee Usage Plan. ORH’s goals for the use of the 

funds were to improve the percentage of fee care dollars spent on rural 

veterans and the percentage of rural patients utilizing VHA services. In 

addition, a key challenge associated with using these funds was to ensure 

that the VISNs obligated the funds during FY 2010. Under this plan, each 

VISN received a payment based upon their percentage of fee care dollars 

obligated for fee care provided to rural veterans in FY 2009. 

VA Office of Inspector General 2 
Audit of the VHA’s Office of Rural Health 

Office of Rural 

Health Proposal 

Selection Process 

Not Followed 

In coordination with ORH, the VHA Chief Financial Officer instructed 

the VISNs to distribute the funds to their Veterans Affairs Medical 

Centers (VAMCs) and to have the VAMCs obligate the rural health funds 

to fee care previously provided and paid during the 6-month period of 

October 1, 2009, through March 31, 2010. However, the VAMCs were 

unable to demonstrate if the use of these funds improved access to care for 

rural veterans. The following example illustrates the VAMC’s inability to 

demonstrate the effectiveness of fee care funds. 

One VAMC received $3.2 million of Fee Usage Plan funds. The 

VAMC transferred $3 million of Fee Usage Plan funds to their 

general account. The VAMC used the funds without any ORH 

restrictions and were unable to demonstrate how these funds 

improved access and quality of care for rural veterans. By the 

end of FY 2010, the VAMC had increased their overall planned 

fee expenditures by only about $252,000 but did not know how 

much that amount increased access for rural veterans. 

This occurred because ORH did not mitigate the significant financial risks 

of the plan by implementing adequate controls, such as providing written 

guidance on the use of rural health funds to ensure VAMCs spent the 

$200 million as intended and monitoring whether the plan was achieving 

its goals. 

As a result of ORH’s ineffective management of the Rural Health Fee 

Usage Plan, VHA lacks assurance that access to care for rural veterans 

improved. We interviewed four VISN and four VAMC Chief Financial 

Officers, and they could not demonstrate how their shares of the funds 

improved access to care for rural veterans. ORH officials also 

acknowledged that they did not have performance data that demonstrated 

how the $200 million obligated toward this plan achieved its 

goalsimproving the percentage of fee care dollars spent on rural 

veterans and the percentage of rural veterans utilizing VHA services. 

ORH did not follow their proposal selection process to ensure the 

proposals approved by ORH improved access and quality of care for 

veterans living in rural areas. A tenet of Standards for Internal Control in 

the Federal Government is that organizations need to establish control 

activities, such as implementing policies, procedures, and mechanisms 

that enforce management’s directives. 

In FYs 2009 and 2010, ORH issued requests for proposals to identify 

projects that had measurable impacts on outreach and health care delivery 

for rural veterans. ORH provided proposal requirements for VHA 

program offices, VISNs, and VAMCs to submit proposals for competitive 

ORH funding. ORH also developed review criteria to evaluate the 

proposals. ORH approved 71 proposals totaling $210.3 million during 

FY 2009 and approved 117 proposals totaling $44.6 million in FY 2010. 

VA Office of Inspector General 3 
Audit of the VHA’s Office of Rural Health 

Overall, ORH approved 188 proposals totaling $254.9 million. These 

projects were in areas such as telehealth, mental health, and other areas 

designed to meet the unique needs of veterans living in rural settings. 

Although ORH had developed an adequate proposal selection process, we 

found that 74 (39 percent) of 188 proposals that ORH approved did not 

meet ORH’s proposal requirements or review criteria. The total value of 

these 74 projects was $72.3 million. Table 1 below summarizes the 

proposal review weaknesses that affected the funding for projects 

approved for FYs 2009 and 2010. 

Table 1 FYs 2009 and 2010 Proposal Review Weaknesses 

Review Weaknesses Number of Proposals 

Value of Proposals 

($ in Millions) 

FY 2009 Requirements Not Met 18 $31.8 

FY 2010 Requirements Not Met 43 $12.5 

Total Requirements Not Met 61 $44.3 

FY 2009 Review Criteria Not Followed 13 $28.0 

FY 2010 Review Criteria Not Followed 0 N/A 

Total Review Criteria Not Followed 13 $28.0 

Total 74 $72.3 

Proposal 

Requirements 

Not Met 

Source: OIG analysis of 188 proposals funded by ORH for rural health projects. 

Although ORH’s proposal selection process stated that proposals must 

adhere to all proposal requirements, we found that ORH approved 

61 (32 percent) of 188 projects valued at $44.3 million that did not meet 

proposal requirements. ORH procedures required the proposals to provide 

such information as the proposed project’s objective, strategy, and impact. 

It also required the proposals to identify specific quantitative and 

qualitative evaluation measures to assess cost, quality, access, outcomes, 

and effectiveness. (Appendix B, Tables 3 and 4, show how frequently 

ORH did not meet proposal requirements.) The following examples 

illustrate approved projects that did not address proposal requirements. 

	 A VISN submitted a $4.1 million project proposal to hire
 

providers and purchase equipment needed to provide telemental
 

health services to rural veterans in the VISN. A review team
 

member noted that the proposal lacked adequate information to
 

evaluate whether the health care needs in the area were sufficient
 

to justify this level of effort, questioning basic information such
 

as the number of veterans expected to receive services. In spite
 

of the proposal lacking critical project information, ORH
 

approved $4.1 million for the project.
 

VA Office of Inspector General 4 
Audit of the VHA’s Office of Rural Health 

Review Criteria 

Not Met 

	 A VISN submitted a proposal valued at just under $868,500 for a
 

mobile van to provide breast cancer and aneurysm screenings
 

closer to the residences of rural veterans. However, a reviewer
 

had noted that the proposal needed clarification regarding the
 

type of staff and equipment the VISN proposed to use. In
 

addition, the proposal showed two amounts for equipment,
 

$709,000 and $809,000. Due to mathematical errors, it was
 

unclear which proposed amount was correct. Without sufficient
 

data, ORH could not determine the specific screenings the VISN
 

would be able to provide, the cost of the equipment, or the
 

cost-effectiveness of the proposed van. Even though the
 

proposal lacked key information, ORH used the higher dollar
 

value for the equipment and approved just under $868,500 for
 

the project.
 

In FY 2009, ORH approved 13 (18 percent) of 71 projects totaling 

$28 million that did not meet ORH’s review criteria. A step in the review 

process required VHA program officials to review proposals in their 

subject area of expertise. (Appendix B, Table 5 shows how frequently 

ORH did not meet review criteria.) Specifically, ORH asked VHA 

program officials to determine whether the proposals: 

 Enhanced health care and did not conflict with current strategies 

instituted within VHA 

 Conflicted with policies and procedures of current VHA programs 

 Addressed the relevant legal, legislative, regulatory, privacy, 

confidentiality, and patient safety issues 

We interviewed two VHA program officials who reviewed and provided 

comments to ORH on the 13 proposals that did not meet one or more of 

the review criteria. Both officials stated ORH staff did not collaborate 

with them to try to address their concerns or recommendations for 

disapproval. The following are two examples of the lapses and 

weaknesses in the review processes that occurred because ORH staff did 

not address concerns of VHA program officials before approving project 

proposals. Both program officials stated they would only recommend 

funding the proposals if ORH staff addressed their concerns. 

 An official from VHA’s Office of Telehealth Services reviewed
 

a $2.8 million VISN proposal to develop an electronic intensive
 

care unit and virtual response team. The response team would
 

use video conferencing between tertiary medical centers and
 

non-critical care staff at small rural facility intensive care units.
 

The Office of Telehealth Services official expressed concerns
 

that the program sponsors did not adequately document the
 

underlying need for the proposed services and the projected
 

numbers of veterans that would benefit. Thus, it was difficult to
 

VA Office of Inspector General 5 
Audit of the VHA’s Office of Rural Health 

Reasons Selection 

Process Not 

Followed 

Effects of Not 

Following Selection 

Process 

Monitoring of 

Rural Health 

Funds Needs 

Improvement 

justify the level of need supporting this investment in resources. 

In addition, the official also had significant concerns that the 

proposal did not address patient safety and regulatory issues. 

ORH approved and funded the $2.8 million project without 

addressing the official’s concerns. 

	 An official from VHA’s Office of Geriatrics and Extended Care
 

reviewed a $2.5 million VISN proposal for a contractor to
 

perform a transportation study to analyze the unique
 

transportation challenges encountered by rural veterans in their
 

VISN. The review official rated the proposal very low and
 

expressed concerns that the transportation study was excessively
 

costly, lacked innovation, and would not result in direct benefit
 

to rural veterans in the VISN. ORH proceeded to fund the
 

$2.5 million project without contacting the Office of Geriatrics
 

and Extended Care official to discuss these concerns.
 

ORH did not follow their proposal selection process because ORH, until 

recently, did not have the management staff in place that had the 

knowledge, skills, and experience required to lead and manage a newly 

established organization. We observed organizational improvements 

during our audit. For example, ORH hired staff with experience in 

financial management and budgeting. In addition, staffing is in place to 

develop and implement management policies and procedures to help 

ensure ORH staff follow their proposal selection process. 

In addition, ORH lacked an effective communication plan that leveraged 

the knowledge and experience of key stakeholders, such as VRHRCs, 

VHA program office, and VISN senior staff. These key stakeholders are 

valuable resources to ORH because of the stakeholders’ knowledge of 

rural health care and their experience providing care to rural veterans. 

Senior ORH officials acknowledged that they did not sufficiently 

coordinate or collaborate with key stakeholders to resolve concerns of 

VHA program officials regarding the officials’ reviews of submitted 

proposals. 

As a result, ORH officials acknowledged they lack reasonable assurance 

that their use of $72.3 million (14 percent) of the $533 million funding 

received in FYs 2009 and 2010 effectively increased access to health care 

for veterans residing in rural areas. 

We found that ORH did not adequately monitor rural health obligations 

once ORH transferred the funds to the VISN or VHA program office that 

sponsored the project. The Standards for Internal Control in the Federal 

Government states that management controls, such as documenting and 

monitoring of financial transactions, represent fundamental Federal 

Government controls. 

VA Office of Inspector General 6 
Audit of the VHA’s Office of Rural Health 

Reasons Rural 

Health Funds Not 

Monitored 

VISN staff did not consistently report their obligated funds at the project 

level of detail, and ORH staff did not validate the accuracy of obligation 

data at the project level. Consequently, ORH did not have the necessary 

financial data to effectively monitor obligations by project. Project 

sponsors often made requests to move funds designated for a specific 

project to other rural health needs because they were not able to obligate 

the allocated funds. ORH staff told us that they often approved these 

requests, but they did not know if the transferred funds improved access 

and quality of care for rural veterans. The following example illustrates 

this problem. 

ORH approved a VISN proposal for $930,145 to expand 

home-based primary care. The project included hiring providers 

to manage the veterans’ primary care needs as well as purchasing 

business space and transportation vehicles for the staff. 

Although the proposal estimated the VISN would admit 

120 veterans to the project during the project’s initial 6-month 

period, the VISN only admitted 19 veterans during this period. 

VISN officials requested a transfer of rural health funds from 

another project to sustain the home-based primary care project. 

ORH staff approved the VISN’s request without reviewing the 

project and questioning the VISN as to why the project did not 

meet its performance goals or what effect the transfer would have 

on the other project. 

Additionally, ORH budget staff found it difficult to monitor the 

188 projects approved in FYs 2009 and 2010. This was a particular 

problem since the VHA program offices, VISNs, and VAMCs 

independently managed their projects. Although ORH budget staff 

collected limited information by e-mail and telephone conversations with 

project sponsors and received monthly financial data at the VISN and 

VAMC level from the VHA Chief Financial Officer, ORH budget staff 

did not have project level information that was relevant, reliable, and 

timely. For example, ORH staff did not effectively monitor the funds 

obligated for their projects to ensure all of the funds would be obligated 

by the end of the fiscal year. They did not address this situation until May 

2010, when ORH staff determined that they had only obligated 

$196.3 million (37 percent) of the $533 million received during FYs 2009 

and 2010. 

ORH staff did not adequately monitor obligations of funds because they 

lacked an adequate project monitoring system, such as an Access database 

on a portal, which could have provided them with program information to 

manage rural health funds effectively. Establishing an electronic database 

and monitoring procedures would enable ORH staff to continuously 

monitor project funding and allow program sponsors to enter required 

information directly into a central database, thus providing ORH staff 

VA Office of Inspector General 7 
Audit of the VHA’s Office of Rural Health 

Performance 

Measures 

Inadequately 

Monitored 

with real time management information that is more relevant, reliable, and 

timely. 

As a result, at the end of FY 2010, ORH did not obligate $16 million 

(2 percent) of the $533 million received during FYs 2009 and 2010. Of 

the $16 million, ORH carried-over about $15 million for use in FY 2011. 

However, the authority to use almost $1 million of these funds ultimately 

lapsed. This constituted missed opportunities for ORH to improve access 

and quality of care for rural veterans by not having sufficient controls to 

ensure the use of all available appropriated funds. 

We found that ORH staff did not monitor projects’ performance measures. 

Another tenet of Standards for Internal Control in the Federal 

Government is that organizations need to establish procedures to monitor 

performance measures. This enables the organization to compare 

different sets of data to one another and analyze their relationships to each 

other so the organization can take appropriate actions. 

ORH officials required project sponsors to submit monthly or quarterly 

reports that addressed the following: 

 Summary of issues and accomplishments 

 Numbers of veterans served 

 Project funding 

 Program evaluation measures 

The project sponsors monitored their projects and generally submitted the 

required reports to ORH. However, ORH staff did not monitor these 

progress reports to determine whether projects were meeting their 

performance measures. The project sponsors we interviewed stated that 

ORH staff rarely questioned or commented on their progress reports. This 

included times when the sponsors had submitted questions or expressed 

concerns in their reports. ORH officials stated that they used the quarterly 

reports to develop their reports to Congress, but they did not use the 

reports to monitor whether projects were meeting their performance 

measures. 

This occurred because ORH had not established adequate procedures to 

monitor performance measures. ORH senior management stated that due 

to staffing issues and recent problems encountered in developing an 

automated monitoring system, ORH was unable to implement adequate 

procedures to monitor the quarterly reports or the reported performance 

measures for the 188 projects. By monitoring the projects’ performance 

measures, ORH staff could have made assessments that compared the 

performance measures with actual performance. This would have 

detected potential problems and provided an opportunity to find solutions 

to the problems or make informed decisions on whether to continue the 

projects. 

VA Office of Inspector General 8 
Conclusion 

Audit of the VHA’s Office of Rural Health 

Because ORH staff did not monitor the performance measures of the 

projects, ORH officials acknowledged that they did not have the data to 

determine the impact rural health funding had on improving access and 

quality of care for rural veterans. In addition, ORH officials did not know 

how many projects could have been canceled or modified had their 

performance been adequately monitored. 

ORH approved 188 projects with FYs 2009 and 2010 funds, yet they 

acknowledged that they cannot sustain many of these projects with their 

requested $250 million appropriation for FY 2011. According to ORH 

and VHA officials they based their FYs 2010 and 2011 budget proposals 

on the same appropriated funding they received in FY 2009 rather than 

assessing the program’s actual needs. As a result, ORH plans to allocate 

$162.2 million in FY 2011 to sustain 114 projects at their current level of 

service and $70.1 million to sustain the 51 CBOCs funded in FY 2010. In 

addition, ORH plans to allocate $17.7 million to implement a pilot 

program required by Congress to provide non-VA health care services 

through contractual arrangements to eligible rural veterans. ORH was to 

implement this pilot program in FY 2009. 

Given the weaknesses we identified in ORH’s proposal selection process, 

including approving proposals that did not meet requirements or failing to 

resolve the concerns of technical reviewers, ORH needs to reassess the 

funded initiatives approved for implementation in FY 2012. Further, the 

need to perform this budget review is important given the absence of 

performance data of previously funded project initiatives and program 

officials acknowledging they will be challenged to sustain many of these 

projects, ORH needs to increase their accountability of future rural health 

funds. ORH can improve their stewardship of program funds and 

safeguard the integrity of their program by reassessing FY 2012 project 

initiatives to ensure funded projects are necessary and consistent with 

actual program needs. 

By identifying high-impact projects during the formulation of the 

program’s annual budget requests and strengthening its future proposal 

selection process, ORH has the opportunity to integrate comprehensive 

rural health projects fully into VHA’s health care delivery system. By 

strengthening their management controls, establishing performance 

measures, and monitoring the performance of future initiatives funded by 

ORH, ORH program officials can improve accountability of funds 

entrusted to them and measure the impact of their program on the health 

care of rural veterans and their families. These controls are critical for 

ORH to meet the challenges of increased Government oversight of 

department budgets and heightened emphasis on Government 

transparency and efficiency. 

VA Office of Inspector General 9 
Audit of the VHA’s Office of Rural Health 

Recommendations 

Management 

Comments and 

OIG Response 

Recommendation 1. We recommended that the Under Secretary for 

Health implement financial controls, such as providing written guidance 

to program sponsors and implementing a mechanism to monitor the use of 

rural health funds. 

Recommendation 2. We recommended that the Under Secretary for 

Health establish management policies and procedures to ensure VHA’s 

proposal selection process is followed. 

Recommendation 3. We recommended that the Under Secretary for 

Health implement an effective communication plan to effectively 

coordinate and collaborate with key rural health care stakeholders in the 

use of rural health care funds. 

Recommendation 4. We recommended the Under Secretary for Health 

establish a project monitoring system, such as an Access database on a 

portal and implement monitoring procedures that would provide relevant, 

reliable, and timely project management information. 

Recommendation 5. We recommended that the Under Secretary for 

Health establish procedures to monitor performance measures to 

determine the impact of rural health care funding on improving access and 

quality of care for rural veterans. 

Recommendation 6. We recommended that the Under Secretary for 

Health reassess the rural health initiatives approved for funding by Office 

of Rural Health in their FY 2012 budget to align planned use of resources 

to their greatest rural health needs. 

The Under Secretary for Health agreed with the finding, 

recommendations, and monetary benefits and provided acceptable 

implementation plans. The Under Secretary stated that ORH has 

implemented new monitoring procedures to track, monitor, and provide 

oversight of VISN and program office project funding. A Selection 

Review Committee has been established to rate submitted projects using 

specific criteria based on broader VA goals. ORH has also established a 

centralized data sharing system and periodic communication with VA 

program leads and other federal, state, and local agencies. 

ORH deployed an Access database to collect quarterly project 

performance data and plans to deploy a national web-based data 

collection, evaluation, and reporting system to provide an accurate 

assessment of each project. In collaboration with 4 VHA program offices 

and the Office of Quality and Performance, ORH is developing 6 core 

access and 47 quality measures to compare project performance across 

VISNs and against benchmarks. ORH also plans to reassess geographic 

VA Office of Inspector General 10 
Audit of the VHA’s Office of Rural Health 

and clinical health needs to identify the FY 2012 proposals that address 

the greatest health care needs and plans to complete all corrective actions 

by October 2011. We will monitor VHA’s implementation of the planned 

actions. Appendix D contains the full text of the Under Secretary’s 

comments. 

VA Office of Inspector General 11 
Audit of the VHA’s Office of Rural Health 

Appendix A 

Scope and 

Methodology 

Scope and Methodology 

To accomplish our objectives, we reviewed ORH’s planning and 

management of $533 million provided to ORH during FYs 2009 and 

2010. We identified and reviewed applicable Federal laws, Federal 

regulations, and VHA policies related to ORH management. 

We reviewed ORH project allocation spreadsheets and VHA 

memorandums. We also interviewed ORH staff to identify all of the 

projects ORH funded using FYs 2009 and 2010 funding and to evaluate 

the proposal requirements and review criteria. We interviewed senior 

management and staff at ORH and at all three VRHRCs to determine 

whether ORH appropriately utilized key stakeholders to ensure projects 

met ORH’s mission and did not duplicate other VHA activities. 

We interviewed ORH staff and analyzed the project proposals and 

reviewer comments for all 188 ORH funded projects to determine whether 

the proposals met ORH’s project selection requirements and whether 

OHR followed their review process. We did not analyze the decision 

process used to reallocate funds returned to ORH from the 188 funded 

projects. To determine whether ORH adequately monitored their project 

obligations and performance measures, we reviewed funding for one 

project at each of four randomly selected VHA program offices. We also 

reviewed funding for 31 of the 188 projects, 18 CBOCs, and the Fee 

Usage Plan at 4 randomly selected VISNs. Table 2 below shows the 

number of projects and CBOCs reviewed at each site. 

Table 2 Schedule of Reviewed Projects and CBOCs 

VISN or VHA Program Office 

Projects 

Reviewed 

CBOCs 

Reviewed 

VISN 1: VA New England Healthcare System 4 1 

VISN 16: South Central VA Health Care Network 7 9 

VISN 19: Rocky Mountain Network 13 0 

VISN 23: VA Midwest Health Care Network 7 8 

VHA Office of Telehealth Services 1 N/A 

VHA Office of Mental Health Services 1 N/A 

VHA Office of Geriatrics and Extended Care 1 N/A 

VHA Chief Health Informatics Offices 1 N/A 

Source: OIG random sample selection performed in consultation with the statistician for 

the Office of Audits and Evaluations. 

VA Office of Inspector General 12 
Audit of the VHA’s Office of Rural Health 

Reliability of 

ComputerProcessed Data 

Compliance With 

Government Audit 

Standards 

For the selected projects, we discussed project obligations, performance 

measures, and ORH’s level of coordination in project selection with VISN 

management, Chief Financial Officers, VISN Rural Consultants, and 

project staff at the four VISNs and management officials at the four VHA 

program offices and CBOCs. We also reviewed Financial Management 

System reports showing project obligations and funds transfers, invoices, 

salary data, and reports submitted to ORH to determine the accuracy of 

ORH’s financial data. We also reviewed Veterans Health Information 

Systems and Technology Architecture and other productivity reports 

showing progress toward meeting performance measures to determine the 

accuracy of ORH’s performance measurement data. 

To test the reliability of computer-processed data, we compared the 

funding data obtained from VHA’s Financial Management System to 

ORH reports showing project obligations, fund transfers, and other 

financial data. We found no significant discrepancies and concluded that 

the data was sufficiently reliable for the audit objective. 

We conducted our audit work from July 2010 through February 2011. 

Our assessment of internal controls focused on those controls relating to 

our audit objectives. We conducted this performance audit in accordance 

with generally accepted Government auditing standards. These standards 

require that we plan and perform the audit to obtain sufficient, appropriate 

evidence to provide a reasonable basis for our findings and conclusions 

based on our audit objective. We believe that the evidence obtained 

provides a reasonable basis for our findings and conclusions based on our 

audit objective. 

VA Office of Inspector General 13 
Audit of the VHA’s Office of Rural Health 

Appendix B Projects with Proposal Review Weaknesses
 

Table 3. FY 2009 Projects That Did Not Meet Proposal Requirements 

Table 3 summarizes the results of our review of the 71 proposals totaling 

$210.3 million ORH approved in FY 2009. We found that 18 proposals 

(25 percent) totaling $31.8 million (15 percent) did not meet one or more 

of the proposal requirements as summarized below. 

Project 

Count Objectives Strategy Impact 

Program 

Evaluation 

Measures 

Total Funding 

Awarded 

1 X $398,284 

2 X 277,226 

3 X 4,072,660 

4 X X X 2,273,755 

5 X X X 334,182 

6 X 541,693 

7 X 884,579 

8 X 1,085,292 

9 X X 1,038,850 

10 X $922,400 

11 X X 5,200,000 

12 X 4,482,816 

13 X 911,040 

14 X 891,235 

15 X 117,012 

16 X X X 981,852 

17 X X 5,558,109 

18 X 1,825,884 

Total 3 9 1 14 $31,796,869 

X = Program selection requirement not met. 

Source: OIG analysis of 71 ORH proposals for rural health projects. 

VA Office of Inspector General 14 
Audit of the VHA’s Office of Rural Health 

Table 4. FY 2010 Projects That Did Not Meet Proposal Requirements 

Table 4 summarizes the results of our review of the 117 proposals totaling 

$44.6 million ORH approved in FY 2010. Forty-three proposals 

(37 percent) totaling $12.5 million (28 percent) did not meet one or more 

of the proposal requirements as summarized below. 

Project 

Count Objectives Strategy Impact 

Program 

Evaluation 

Measures 

Total Funding 

Awarded 

1 X $67,600 

2 X 43,500 

3 X 1,100,000 

4 X 2,082,000 

5 X X 10,000 

6 X 125,000 

7 X 27,150 

8 X X 8,000 

9 X 212,500 

10 X 404,000 

11 X X X X 15,000 

12 X 95,264 

13 X 235,253 

14 X 141,351 

15 X X X X 52,000 

16 X X X X 12,000 

17 X X X 55,000 

18 X 198,000 

19 X 119,937 

20 X 685,000 

21 X 32,995 

22 X X 78,000 

23 X 868,477 

24 X 916,140 

25 X 40,850 

26 X 13,278 

27 X 126,750 

28 X $76,213 

29 X $41,000 

30 X 515,621 

31 X 78,000 

32 X 248,388 

33 X 433,423 

34 X 375,000 

35 X 1,100,000 

36 X 35,889 

37 X 155,523 

38 X 45,625 

39 X X X X 117,750 

40 X X X X 42,481 

41 X X X X 103,500 

42 X X X X 70,000 

43 X X X X 1,280,000 

Total 10 10 9 43 $12,483,458 

X = Program selection requirement not met. 

Source: OIG analysis of 117 ORH proposals for rural health projects. 

VA Office of Inspector General 15 
Audit of the VHA’s Office of Rural Health 

Table 5. FY 2009 Projects That Did Not Follow Review Criteria 

Table 5 summarizes the results of our review of the 71 proposals totaling 

$210.3 million ORH approved in FY 2009. Thirteen proposals 

(18 percent) totaling $28.0 million (13 percent) did not meet one or more 

of the review criteria as summarized below. 

Project 

Count Impact 

Program 

Evaluation 

Measures 

Review 

Criteria Not 

Followed 

Total Funding 

Awarded 

1 X $2,173,217 

2 X X X 345,700 

3 X X 1,100,000 

4 X 4,837,698 

5 X 2,533,860 

6 X 1,933,252 

7 X 1,837,320 

8 X 2,136,030 

9 X 680,000 

10 X X X 1,201,665 

11 X 2,845,260 

12 X 1,712,542 

13 X 4,697,000 

Total 2 3 13 $28,033,544 

X = Review criteria not followed. 

Source: OIG analysis of 71 Office of Rural Health proposals for rural health projects. 

VA Office of Inspector General 16 
Audit of the VHA’s Office of Rural Health 

Appendix C Potential Monetary Benefits in Accordance With 

Inspector General Act Amendments 

Recommendation Explanation of Benefits Better Use of 

Funds 

Questioned 

Costs 

1 Implement financial controls to 

improve access and quality of care 

for rural veterans. $200 million 

2-3	 Establish management policies and 

procedures and implement an 

effective communication plan to $72.3 million 

improve access and quality of care 

for rural veterans. 

4-5	 Establish an electronic database and 

monitoring system and establish 1.0 million 

procedures to monitor performance 

measures. 

Total	 $73.3 million $200 million 

VA Office of Inspector General 17 
Audit of the VHA’s Office of Rural Health 

Appendix D Under Secretary for Health Comment
 

Department of Memorandum Veterans Affairs 

Date: April 21, 2011 

Under Secretary for Health (10) From: 

OIG Office of Audits and Evaluations Draft Report, Audit of the Office of Rural Subj: 

Health (VAIQ 7021558) 

To: Director, Seattle Audit Operations 

1.	 I have reviewed the draft report and concur with the report’s six 

recommendations. In addition, I concur with the reports projected estimates of 

questioned costs of $200 million and $73.3 million in better us of funds. 

Attached is the Veterans Health Administration’s corrective action plan for the 

report’s recommendations 

Thank you for the opportunity to review the draft report. If you have any 

questions, please contact Linda H. Lutes, Director, Management Review Service 

(10B5) at (202) 461-7014. 

2. 

Robert A., Petzel, M.D. 

Attachment 

VA Office of Inspector General 18 
Audit of the VHA’s Office of Rural Health 

VETERANS HEALTH ADMINISTRATION (VHA) 

Action Plan 

OIG Draft Report, Audit of the Office of Rural Health (VAIQ 7021558) 

Date of Draft Report: March 11, 2011 

Recommendations/Actions Status Completion Date 

Recommendation 1. We recommend that the Under Secretary for Health 

implement financial controls, such as providing written guidance to program 

sponsors and implementing a mechanism to monitor the use of rural health 

funds. 

VHA Comments 

Concur 

The Veterans Health Administration (VHA) concurs with this Office of the Inspector 

General (OIG) recommendation to implement tighter financial controls. In addition to 

refining written program guidance provided to program sponsors and implementing 

more refined and coordinated mechanisms to monitor the use of rural health funds, the 

Office of Rural Health (ORH) has already taken steps to improve its practices to 

enhance the overall effectiveness of financial operations. 

ORH has hired nine new staff including a Director, Deputy Director, and a Budget 

Analyst to develop and support a more rigorous financial tracking and monitoring 

process, including: 

 Implementation of processes to use detailed spreadsheets to track funds by 

appropriation, Veteran Integrated Service Network (VISN), station, and project; 

 ORH leadership weekly review of the tracking information; 

 Use of an automated system to disseminate budget information to IVSN and 

Program Offices. 

In October 2010, ORH developed the Fiscal Year (FY) 2011 Spend Plan. The plan 

was approved by the Under Secretary for Health and the Office of the Secretary of 

Veterans Affairs (SECVA) and cleared by the Office of Management and Budget 

(OMB) for execution on March 4, 2011. ORH now: 

 Coordinates with VISNs and Program Offices to track expenditures;
 

 Reviews funds execution regularly;
 

 Has assigned specific staff as liaisons with VISNs and Veteran Rural Health
 

Resource Centers (VRHRC) to track, monitor, and provide oversight of projects and 

funding for VISN and Program Office projects. 

VA Office of Inspector General 19 
Audit of the VHA’s Office of Rural Health 

The implementation of VISN Spend Plans and the utilization of ORH staff as liaisons 

specifically address the requirements in the Standards for Internal Control in the Federal 

Government for monitoring of financial transactions. 

ORH leadership has refined existing and created new procedures as well as formalized 

funding execution requirements. These are included in the documents: 

 Funding Execution VHA Programs and VISNS 

 Funding Execution VRHRCs. 

VISN Chief Fiscal Officers and appropriate Program Office officials have been educated 

about monitoring, tracking, and reporting standards for funded projects at the project 

level. These new reporting requirements will ensure appropriate documentation of 

project spending and correct obligation of all funds at the end of the fiscal year. In 

addition, ORH leadership designed and implemented a corrective action strategy or 

Risk Plan to include a re-distribution of funds if project outcomes and measurements 

are not being met in a timely manner. 

Completed 

Recommendation 2. We recommend that the Under Secretary for Health establish 

management policies and procedures to ensure VHA’s proposal selection 

process is followed. 

VHA Comments 

Concur 

VHA concurs with the OIG recommendation to establish management policies and 

procedures to ensure VHA’s proposal selection process is followed. ORH leadership 

has already implemented two new procedures that meet the requirements of the 

Standards for Internal Control in the Federal Government. These are the: 

 Funding Execution VHA Programs and VISN Project/Program Performance 

Evaluation 

 Measures Collection and Analysis. 

These establish tight controls for proposal review and approval and include establishing 

a process to review submitted projects against specific project funding rating criteria. 

ORH leadership developed this project funding rating criteria based on the SECVA 

Goals, Priorities and Initiatives, VHA Priorities, and ORH Focus Areas or Strategic 

Goals and Measurements of Progress. The ORH Director will appoint a Selection 

Review Committee (SRC) composed of a cross-section of VHA subject matter experts 

(SMEs) familiar with the mission and goals of the Department of Veterans Affairs (VA), 

VA Office of Inspector General 20 
Audit of the VHA’s Office of Rural Health 

VHA, and ORH. ORH will rely on the SRC members’ knowledge and expertise during 

the rating and review process. 

Additionally, the process document Implementation of the Project/Program Performance 

and Evaluation Measures Collection and Analysis specifically defines how ORH will 

evaluate projects once they are funded. The process establishes how and when ORH 

will collect performance measurement data and validate implemented versus proposed 

objectives, strategies, and impacts of funded projects. The process details the content 

of the quarterly reports to ORH leadership in regard to measures and impact data of 

funded projects. This organized collection of project information allows ORH to review 

VISN and Program Office management as well as project qualitative and quantitative 

data continuously. 

The newly defined responsibilities of the SRC include a process to resolve member 

concerns about feasibility, compliance, and appropriateness identified during the 

proposal review process. First, the Funding Execution requirements include review 

process guidelines and rating criteria modified from previous reviews to ensure SRC 

members’ concerns are addressed. Second, the process requires the SRC to convene 

a post-rating and review meeting to address any outstanding concerns before any final 

funding determination is made. 

Completed 

Recommendation 3. We recommend that the Under Secretary for Health 

implement an effective communication plan to effectively coordinate and 

collaborate with key rural health care stakeholders in the use of rural health care 

funds. 

VHA Comments 

Concur
 

ORH has already taken several steps to improve internal communications, as well as
 

external communications. For example, the ORH Director, Deputy Director, and key
 

staff lead:
 

 a bi-monthly teleconference with leadership of the VRHRCs,
 

 a monthly call with the VISN Rural Consultants (VRCs), and
 

 a weekly meeting with ORH Veterans Affairs Central Office (VACO) staff.
 

These meetings address budget issues; administrative issues; project updates; and
 

other topics related to the implementation, oversight, and evaluation of ORH-sponsored
 

projects. Minutes are taken and distributed.
 

In addition, ORH leadership regularly conveys information to VACO and field staff
 

regarding VA leadership priorities and initiatives; new ORH collaborations and
 

VA Office of Inspector General 21 
Audit of the VHA’s Office of Rural Health 

initiatives; VHA and ORH policies; ORH impacts and best practices. Information is
 

shared via teleconference, email, intranet SharePoint site, the ORH internet site, and
 

face to face bi-annual meetings.
 

All ORH staff, including the VRHRCs and VRCs, have been given access to and are
 

directed to use the ORH Knowledge Management System (KMS). This is a central
 

repository of the shared tools and information necessary to successfully implement and
 

report on each ORH initiative. Examples of shared tools include the
 

 Clinical needs assessment template,
 

 ORH outreach materials,
 

 ORH logos,
 

 ORH branding guidance,
 

 PowerPoint templates,
 

 Stakeholder contact database, and
 

 Budget reporting templates.
 

The KMS also contains presentations from past VRC meetings, a central calendar of
 

events such as ORH meetings and conferences, and ORH products such as peerreviewed publications and on-demand webinars.
 

In January 2011, ORH released three communications products, all designed to inform
 

stakeholders about the ORH mission, programs, initiatives, and impacts on rural
 

Veterans:
 

 the completely revised and redesigned ORH website (http://www.ruralhealth.va.gov);
 

	 the quarterly ORH newsletter; and
 

	 monthly ORH Fact Sheets. The monthly ORH fact sheets contain a summary of 

results from recently published studies on the health and health care of rural 

Veterans. 

The ORH VRHRCs, the VRCs, and individual project leads are contacted regularly with 

requests to provide content for the newsletter and website. 

An Access database containing contact information for key rural health stakeholders 

was created in March 2011and will allow ORH to disseminate targeted as well as 

general communications regarding ORH activities to VA/VHA leadership, facility 

leadership, rural community-based outpatient clinics (CBOCS) and outreach clinics, 

program leads, clinicians, and support staff; national, state, and local rural health 

programs; Veteran Service Organizations (VSOs); and Veterans who have opted-in 

(subscribed) to receive information from ORH. The ORH Communications Team is also 

leveraging existing VA/VHA communications channels (e.g., VA websites, social media, 

and publications) to reach stakeholders and rural Veterans. 

ORH has also improved communications with key rural health stakeholders by taking a 

more active role by participating in rural health conferences and outreach events, 

VA Office of Inspector General 22 
Audit of the VHA’s Office of Rural Health 

connecting with VA/VHA program leads, and meeting with representatives from other 

federal, state, and local agencies with a rural health focus. 

Development of the contact database and implementation of the communications plan 

will continue to ensure a regular and timely distribution of information to improve internal 

and external communications. 

Completed 

Recommendation 4: We recommend that the Under Secretary for Health 

establish a project monitoring system, such as an Access database on a portal 

and implement monitoring procedures that would provide relevant, reliable and 

timely project management information. 

VHA Comments 

Concur 

ORH has designed an Access data collection and project monitoring system targeted 

for completion and deployment no later than May 31, 2011, to collect measurement and 

project performance data and information. ORH staff will continue to use the ORH 

Project and Measurement Excel spreadsheet database pending completion of the 

Access database computerized tool to ensure data and measures collection, tracking, 

monitoring and documentation of project activity and management. Also, planning for 

the design and deployment of a national web-based data collection, evaluation and 

reporting system is in process. 

In Process May 31, 2011 

Six rural health access measures and forty-seven quality measures, appropriately 

specific to each project, have been applied to rural health projects. Output reports have 

been developed, and all VISNs have reported first quarter FY 2011 performance data 

for evaluation. Additionally all rural health projects are being evaluated to ensure goals, 

objectives and milestones are relevant, up-to-date, and assigned to each project. 

ORH now requires VRCs and Program Office project managers to submit project 

milestone progress quarterly reports. Access and quality measurement data for each 

project are also required to be submitted quarterly. ORH monitors project data to 

ensure reporting and evaluation of data are timely and provide an accurate assessment 

of the current status of each project. ORH leadership also regularly review financial 

reports to ensure efficient and effective utilization and obligation of funds. 

VA Office of Inspector General 23 
Audit of the VHA’s Office of Rural Health 

In Process October 21, 2011 

In summary, structures are now in place and policies and procedures have been 

implemented to ensure proactive monitoring of projects and to provide support and 

assistance to VRCs, project leads at the VISNs and stations, and to VRHRC staff in the 

execution of rural health projects and activities. For example: 

 ORH Program Analysts have been assigned to serve as VISN, VRHRC and 

Program Office liaisons. Their responsibilities include the monthly monitoring of 

projects (or more often as needed) to ensure resources are utilized as intended in an 

effective way to improve access and quality of care to Veterans in rural and highly 

rural areas. 

	 Quality measures have been identified and applied to all ORH projects. 

	 Utilization of the Access data collection and monitoring system enables ORH 

leadership and staff to continuously and proactively monitor and track activities, 

projects and ORH strategic planning initiatives. 

These efforts are specifically related to increasing access and improving quality of care 

for rural Veterans in a way to ensure the provision of relevant, reliable and timely project 

management information. 

Completed 

Recommendation 5. We recommend that the Under Secretary for Health establish 

procedures to monitor performance measures to determine the impact of rural health 

care funding on improving access and quality of care for rural veterans. 

VHA Comments 

Concur 

To address this recommendation, ORH has already implemented a Project/Program 

Performance and Evaluation Measures Collection and Analysis process to monitor 

performance measures in order to determine the impact of rural health care funding on 

improving access and quality of care for rural Veterans. An Access Project Tracking 

Database (PTD) was developed and went live on April 1, 2011. The PTD stores the 

data from all ORH projects and serves as a national rural Veteran data repository and 

monitoring system. It links new proposal submissions and funding activities with 

quarterly documentation of progress, performance metrics, associated milestones and 

products. It enables quick response when measurement data are inaccurate, 

incomplete, or missing. To date, ORH has gathered the first quarter FY 2011 

performance measure data for nearly three hundred ORH VISN-level projects and 

programs (representing services to nearly 400,000 Veterans) funded under Public Law 

110-329. 

VA Office of Inspector General 24 
Audit of the VHA’s Office of Rural Health 

Completed 

In collaboration with the Office of Quality and Performance (OQP), National Programs 

including the Office of Telehealth Services (OTS), Geriatrics and Extended Care (GEC), 

Office of Mental Health Services (OMHS), Office of Academic Affiliations (OAA), VISN 

leadership and other partners, ORH completed development of a national rural health 

measurement data set in December 2010. Six core access measures are being used 

for all ORH funded rural and highly rural VISN level projects, and forty-seven additional 

quality measures are collected based on the project type. Using these measures, ORH 

uses project tracking data to compare performance across VISNs and against 

benchmarks. ORH project measurement data are being continuously tracked, trended, 

analyzed, interpreted in relation to other programs, then reported to leadership in order 

to establish the impact of rural care funding on improving access and quality of care for 

rural Veterans. 

In Process October 21, 2011 

Output from project/program measurement collection efforts is analyzed in combination 

with data from VHA Support Service Center (VSSC), OQP, national Program Offices, 

and publicly reported data sources with anticipated release of an ORH ACCESS Quality 

Impact report in September 2011. ORH is working with OQP on analysis and reporting 

of FY 2010 outpatient data as well as data from rural outreach clinics. Target date for 

reporting this information to ORH is April 30, 2011. Clinical data are obtained from the 

External Peer Review Program (EPRP) outpatient samples. National and VISN 

weighted scores are then calculated for the outpatient quality of care clinical 

composites. Patient satisfaction data from the VHA Survey of Health Experiences of 

Patients (SHEP) are also used to measure satisfaction scores for Veterans receiving 

services through ORH-funded projects in rural areas. 

In Process September, 30, 2011 

In coordination with VSSC, ORH developed the Rural Health Briefing Book (to be 

released April 2011) and Rural Health Dashboard (rollout is scheduled for May 2011). 

These new information resources provide timely and relevant socio-demographic, 

service use, diagnosis, clinical quality, outcomes and cost data about over three million 

Veterans living in rural and highly rural areas. 

In Process May 31, 2011 

In addition to sharing the output of ORH’s core measure set and data collected in 

collaboration with Program Office partners, such as OTS, ORH is sharing information 

about lessons learned using presentations, electronic mailings, national webinars, 

reports and through the ORH website. This has already begun and will continue. 

VA Office of Inspector General 25 
Audit of the VHA’s Office of Rural Health 

Completed 

Recommendation 6: We recommend that the Under Secretary for Health reassess 

the rural health initiatives approved for funding by Office of Rural Health in their 

FY 2012 budget to align planned use of resources to their greatest rural health 

needs. 

VHA Comments 

Concur 

VHA concurs with the recommendation to reassess previously approved initiatives. To 

align the planned use of resources to the greatest rural health needs, a reassessment of 

all ORH rural health initiatives approved for funding by ORH in the FY 2012 budget will 

be accomplished before September 2011. 

Geographic Access Assessments for all VISNs are presently being conducted. Eight 

have been completed; the remaining thirteen will be completed by June 30, 2011. The 

methodology for the assessments employs the Arc Geographic Information System 

(ArcGIS) software and includes the following steps. 

 Travel bands are drawn around each VHA facility by highest level of care provided. 

Specifically, travel times of thirty and sixty minutes around facilities providing primary 

care; one hundred and twenty minutes to facilities providing acute care; and two 

hundred and forty minutes around facilities providing tertiary care. 

	 Gaps in geographic coverage are identified and the number of enrollees in these 

gap areas is tabulated. 

	 Further, non-VA community resources including Federally Qualified Health Centers, 

Rural Health Clinics, Military Treatment Facilities, Indian Health Service facilities and 

community hospitals are layered on to the maps to identify potential partnerships for 

providing services to Veterans in underserved areas 

The outcomes of these assessments will assist ORH to identify those geographic areas 

with the most needs in order to align the use of resources to their greatest health care 

needs. 

In Process	 July 31, 2011 

Health Care Needs Assessments are also underway to assess clinical health needs. 

The assessments will be completed in all VISNs no later than September 30, 2011. 

These assessments will help to determine unique needs of rural Veterans, how the 

needs of VAMCs or CBOCs might be different in rural settings, or the needs of 

providers and staff in rural areas. The focus of these needs assessments will be 

VA Office of Inspector General 26 
Audit of the VHA’s Office of Rural Health 

determined by the VRC and others within each VISN to ensure that those with specific 

knowledge of the rural needs of a particular VISN are involved in the assessments. A 

number of methods will be employed to determine these needs including site visits, 

focus groups, OMB-approved surveys, comment cards, and program evaluation 

strategies. Potential data sources include patient, provider, and staff interviews and 

surveys, field notes from site visits, VISN Corporate Data Warehouse, Austin 

Automation Center, and the Planning Systems Support Group (PSSG) Rural Portal. 

Community agency focus groups have been successfully completed at the Western and 

Central VRHRCs to assess the needs of Veterans within the community-at-large for 

both enrolled and non enrolled Veterans. The community agencies represented include 

aging services, religious groups, VSOs, state offices of rural health, state offices of 

Veterans affairs, local non-VA clinics and hospitals (usually critical access or federally 

funded sites), job services, and other formal and informal community entities. 

The findings from both geographic and health needs assessments will be evaluated to 

determine access issues and quality health care needs of Veterans in rural/highly rural 

areas. This information will be incorporated into a set of criteria to use in review of FY 

2012 proposals to support funding for programs that identify the greatest health care 

needs and health care access needs in rural areas. The results of all findings will be 

shared with the VISN Strategic Planners to be incorporated into the VHA Health Care 

Planning Model (HCPM) as appropriate. The HCPM has incorporated a specific section 

for rural health activities and health professional shortage area. 

In Process September 30, 2011 

An ORH Strategic Plan "refresh" initiative is also underway. These initiatives will inform 

FY 2012 funding decisions by integrating initiatives with identified areas of greatest 

need. This process of alignment of resources with needs assessments will be an 

iterative process occurring annually. 

In Process September 30, 2011 

Additionally an evaluation of all ORH components and functions, i.e. VACO, VRHRCs 

and VRCs, will be accomplished in FY 2011. 

In Process July 31, 2011 

Veteran Health Administration 

April 2011 

VA Office of Inspector General 27 
Audit of the VHA’s Office of Rural Health 

Appendix E OIG Contact and Staff Acknowledgments
 

OIG Contact	 For more information about this report, please 

contact the Office of Inspector General at 

(202) 461-4720 

Acknowledgments	 Gary Abe, Director 

Maria Afamasaga 

Kevin Day 

Lee Giesbrecht 

Marisa Harvey 

Barry Johnson 

Issa Ndiaye 

Tom Phillips 

Melinda Toom 

VA Office of Inspector General 28 
Audit of the VHA’s Office of Rural Health 

Appendix F Report Distribution 

VA Distribution 

Office of the Secretary
 

Veterans Health Administration
 

Veterans Benefits Administration
 

National Cemetery Administration
 

Assistant Secretaries
 

Office of General Counsel
 

Non-VA Distribution 

House Committee on Veterans’ Affairs 

House Appropriations Subcommittee on Military Construction, Veterans 

Affairs, and Related Agencies 

House Committee on Oversight and Government Reform 

Senate Committee on Veterans’ Affairs 

Senate Appropriations Subcommittee on Military Construction, Veterans 

Affairs, and Related Agencies 

Senate Committee on Homeland Security and Governmental Affairs 

National Veterans Service Organizations 

Government Accountability Office 

Office of Management and Budget 

This report will be available in the near future on the OIG’s Web site at 

http://www.va.gov/oig/publications/reports-list.asp. This report will remain 

on the OIG Web site for at least 2 fiscal years. 

VA Office of Inspector General 29