Department of Veterans Affairs

Office of Inspector General

Office of Healthcare Inspections

Report No. 11-00028-140

Combined Assessment Program 

Review of the 

VA Palo Alto Health Care System

Palo Alto, California

April 4, 2011

Washington, DC 20420
Why We Did This Review

Combined Assessment Program (CAP) reviews are part of the Office of Inspector 

General's (OIG's) efforts to ensure that high quality health care is provided to our 

Nation's veterans. CAP reviews combine the knowledge and skills of the OIG's Offices 

of Healthcare Inspections and Investigations to provide collaborative assessments of 

VA medical facilities on a cyclical basis. The purposes of CAP reviews are to:

• Evaluate how well VA facilities are accomplishing their missions of providing veterans 

convenient access to high quality medical services.

• Provide crime awareness briefings to increase employee understanding of the 

potential for program fraud and the requirement to refer suspected criminal activity to 

the OIG.

In addition to this typical coverage, CAP reviews may examine issues or allegations 

referred by VA employees, patients, Members of Congress, or others.

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)
CAP Review of the VA Palo Alto Health Care System, Palo Alto, CA

VA OIG Office of Healthcare Inspections 

Glossary

C&P credentialing and privileging

CAP Combined Assessment Program

CBOC community based outpatient clinic

CHF congestive heart failure

CLC community living center

COC coordination of care

CPR cardiopulmonary resuscitation

CS controlled substances

EOC environment of care

facility VA Palo Alto Health Care System

FPPE Focused Professional Practice Evaluation

FTE full-time employee equivalents

FY fiscal year

JC Joint Commission

MDRO multidrug-resistant organisms

MH mental health

OIG Office of Inspector General

PI performance improvement

PPE personal protective equipment

PR peer review

PRC Peer Review Committee

PRRTP Psychosocial Residential Rehabilitation Treatment 

Program

QM quality management

SCI spinal cord injury

VHA Veterans Health Administration

VISN Veterans Integrated Service Network
CAP Review of the VA Palo Alto Health Care System, Palo Alto, CA

VA OIG Office of Healthcare Inspections 

Table of Contents

Page

Executive Summary ................................................................................................... i

Objectives and Scope................................................................................................ 1

Objectives ............................................................................................................... 1

Scope...................................................................................................................... 1

Reported Accomplishments...................................................................................... 2

Results ........................................................................................................................ 3

Review Activities With Recommendations .............................................................. 3

QM .................................................................................................................... 3

Physician C&P................................................................................................... 4

Management of Test Results............................................................................. 5

Management of MDRO...................................................................................... 6

COC .................................................................................................................. 6

Medication Management ................................................................................... 7

Review Activity Without Recommendations............................................................ 7

EOC................................................................................................................... 7

Comments................................................................................................................... 8

Appendixes

A. Facility Profile .................................................................................................... 9

B. Follow-Up on Previous Recommendations........................................................ 10

C. VHA Satisfaction Surveys and Hospital Outcome of Care Measures................ 12

D. VISN Director Comments .................................................................................. 14

E. Facility Director Comments ............................................................................... 15

F. OIG Contact and Staff Acknowledgments ......................................................... 21

G. Report Distribution ............................................................................................ 22
VA OIG Office of Healthcare Inspections i

Executive Summary: Combined Assessment Program

Review of the VA Palo Alto Health Care System, Palo Alto, CA

Review Purpose: The purpose was 

to evaluate selected activities, focusing 

on patient care administration and 

quality management, and to provide 

crime awareness training. We 

conducted the review the week of 

February 7, 2011. 

Review Results: The review covered 

seven activities. We made no 

recommendations in the following 

activity: 

• Environment of Care

The facility’s reported accomplishments 

were improved eye and vision care and

achievements in customer service and 

patient satisfaction.

Recommendations: We made 

recommendations in the following six 

activities: 

Quality Management: Notify the Peer 

Review Committee when corrective 

actions are completed, and strengthen 

processes to ensure documentation of 

patient assessment prior to moderate 

sedation includes all required elements. 

Revise the emergency event record 

form to include all required elements, 

and use the form for individual events 

and trend analysis. 

Physician Credentialing and Privileging:

Revise facility policy and servicespecific proctoring guidelines to comply 

with Focused Professional Practice 

Evaluation requirements for all new 

hires. Require that two efforts to obtain 

verification of clinical privileges held at 

other institutions be made and 

documented in the credentialing and 

privileging folders. 

Management of Test Results:

Communicate normal test results to 

patients within the specified timeframe, 

and ensure consistent documentation of

times that pathology providers report 

critical pathology results to ordering 

providers. 

Management of Multidrug-Resistant 

Organisms: Provide infection prevention 

strategies education to patients infected 

or colonized with multidrug-resistant 

organisms and their families, and 

document it. Ensure employees receive 

annual multidrug-resistant organisms 

education, and document it. 

Coordination of Care: Provide written 

advance directive notification to 

patients, and document it in the medical 

record. 

Medication Management: Ensure that 

pharmacy staff wear clean inner gloves 

when labeling and placing the 

chemotherapy infusion into the transport 

bag. 

Comments

The Veterans Integrated Service 

Network and Facility Directors agreed 

with the Combined Assessment 

Program review findings and 

recommendations and provided 

acceptable improvement plans. We will 

follow up on the planned actions until 

they are completed. 

JOHN D. DAIGH, JR., M.D.

Assistant Inspector General for

Healthcare Inspections
CAP Review of the VA Palo Alto Health Care System, Palo Alto, CA

VA OIG Office of Healthcare Inspections 1 

Objectives and Scope

Objectives CAP reviews are one element of the OIG’s efforts to ensure

that our Nation’s veterans receive high quality VA health 

care services. The objectives of the CAP review are to:

• Conduct recurring evaluations of selected health care 

facility operations, focusing on patient care administration 

and QM.

• Provide crime awareness briefings to increase employee 

understanding of the potential for program fraud and the 

requirement to refer suspected criminal activity to the 

OIG.

Scope We reviewed selected clinical and administrative activities to 

evaluate the effectiveness of patient care administration and 

QM. Patient care administration is the process of planning 

and delivering patient care. QM is the process of monitoring 

the quality of care to identify and correct harmful and 

potentially harmful practices and conditions.

In performing the review, we inspected selected areas, 

interviewed managers and employees, and reviewed clinical 

and administrative records. The review covered the 

following seven activities: 

• COC

• EOC

• Management of MDRO

• Management of Test Results

• Medication Management

• Physician C&P

• QM

The review covered facility operations for FY 2010 and 

FY 2011 through December 2011 and was done in 

accordance with OIG standard operating procedures for 

CAP reviews. We also followed up on selected 

recommendations from our prior CAP review of the facility 

(Combined Assessment Program Review of the VA Palo Alto 

Health Care System, Palo Alto, California, Report 
CAP Review of the VA Palo Alto Health Care System, Palo Alto, CA

VA OIG Office of Healthcare Inspections 2 

No. 08-00786-116, April 23, 2008). The facility had 

corrected all findings. (See Appendix B for further details.) 

During this review, we also presented crime awareness 

briefings for 788 employees. These briefings covered 

procedures for reporting suspected criminal activity to the 

OIG and included case-specific examples illustrating 

procurement fraud, conflicts of interest, and bribery.

In this report, we make recommendations for improvement. 

Recommendations pertain to issues that are significant 

enough to be monitored by the OIG until corrective actions 

are implemented. 

Reported Accomplishments

Research Led to 

Improved Eye and

Vision Care

Two facility researchers have significantly improved the 

quality of life for veterans with eye and vision injuries 

incurred during their deployment in Iraq, Afghanistan, and 

other areas in the world. By bringing together research and 

clinical care, they were able to develop eye and vision injury 

detection and improved examination techniques for 

diagnosing eye injuries as well as a clinical team approach to 

rehabilitation care programs to treat those injuries.

Most CustomerFriendly Choice 

Award

In 2010, the facility received the Most Customer-Friendly 

Choice Award from the American Alliance of Healthcare 

Providers. The award recognized the facility’s efforts in

implementing an excellent health care program that 

successfully resulted in courteous, compassionate, and 

caring service for patients, families, and the community. 

High patient and employee satisfaction enabled the facility to 

obtain this recognition. 

High Patient 

Satisfaction Scores

In FY 2010, the facility scored significantly higher than the 

national average on patient satisfaction on all 27 items 

measured by the survey instrument. It had the highest 

scores in both inpatient and outpatient settings of any facility 

in VISN 21. (See Appendix C, Table 1 for further details.)
CAP Review of the VA Palo Alto Health Care System, Palo Alto, CA

VA OIG Office of Healthcare Inspections 3 

 

1 VHA Directive 2010-025, Peer Review for Quality Management, June 3, 2010. 2 VHA Directive 2006-023, Moderate Sedation by Non-Anesthesia Providers, May 1, 2006. 3 VHA Directive 2008-063, Oversight and Monitoring of Cardiopulmonary Resuscitative Events and Facility 

Cardiopulmonary Resuscitation Committees, October 17, 2008.

Results

Review Activities With Recommendations

QM The purpose of this review was to evaluate whether the 

facility had a comprehensive QM program in accordance 

with applicable requirements and whether senior managers 

actively supported the program’s activities. 

We interviewed senior managers and QM personnel, and we 

evaluated policies, meeting minutes, and other relevant 

documents. We identified the following areas that needed 

improvement. 

PR. VHA requires that the PRC receive notification upon 

completion of corrective actions.

1

Moderate Sedation. VHA requires facilities to document 

patient assessment prior to use of moderate sedation for a 

procedure.

 In 5 of the 10 cases 

reviewed, we found that the PRC tracking log did not indicate 

that corrective actions, such as provider counseling, 

guideline review, and referral for service-specific PR, had 

been completed even though the facility indicated that these 

actions were complete. 

2

Resuscitation and Its Outcomes. VHA requires facilities to 

review specific elements of performance in responding to 

each resuscitation episode and to analyze trends in 

aggregate.

 We found documentation of all required 

elements in only 7 of the 10 outpatient records reviewed. 

Missing elements included airway assessment, review of 

allergies, and re-evaluation immediately before sedation.

3

Recommendations

 Because the emergency event record form 

lacked the required elements, such as errors or deficiencies 

in technique, equipment malfunction, and delays in initiating 

CPR, the facility was unable to review required elements and 

analyze trends.

1. We recommended that the PRC be notified when 

corrective actions are completed.
CAP Review of the VA Palo Alto Health Care System, Palo Alto, CA

VA OIG Office of Healthcare Inspections 4 

 

4 VHA Handbook 1100.19, Credentialing and Privileging, November 14, 2008. 5 VHA Handbook 1100.19. 

2. We recommended that processes be strengthened to 

ensure that documentation of patient assessment prior to 

moderate sedation includes all required elements. 

3. We recommended that the individual emergency event 

record form be revised to include all required elements and 

that the form be used for individual events and trend analysis 

in aggregate. 

Physician C&P The purpose of this review was to determine whether the

facility had consistent processes for physician C&P that 

complied with applicable requirements. 

We reviewed 28 physicians’ C&P files and profiles and found 

that licenses were current. However, we identified the 

following areas that needed improvement.

FPPE. VHA requires that FPPEs be initiated for all 

physicians who have been newly hired.4

Verification of Clinical Privileges. VHA requires the facility to 

make a minimum of two efforts to obtain verification of 

current clinical privileges held elsewhere and to document

this in the C&P folder.

 Facility policy 

states that proctoring/FPPE may be waived upon service 

chief request if the physician demonstrated clinical 

competence in his or her area at affiliated institutions or is an 

expert in that field. Six of the nine available service-level 

guidelines also state that proctoring/FPPE may be waived for 

physicians who served as a resident or fellow. Furthermore, 

service-level guidelines for new hires were not consistent 

with facility policy regarding FPPE processes and forms. 

5

Recommendations

 The verification must include 

whether the privileges are in good standing with no adverse 

actions for the specified period. Of the 28 physician C&P 

files reviewed, only 3 had documentation verifying that the 

provider’s current privileges were in good standing. 

Although the facility made initial attempts to obtain this 

information for the remaining physicians, it did not make 

second attempts when documentation was not received.

4. We recommended that facility policy and service-specific 

proctoring guidelines be revised to comply with VHA 

requirements for FPPE for all new hires.
CAP Review of the VA Palo Alto Health Care System, Palo Alto, CA

VA OIG Office of Healthcare Inspections 5 

 

6 Healthcare Inspection Summary Review – Evaluation of Veterans Health Administration Procedures for 

Communicating Abnormal Test Results, Report No. 01-01965-24, November 25, 2002. 7 VHA Directive 2009-019, Ordering and Reporting Test Results, March 24, 2009. 8 VHA Directive 2009-019. 

5. We recommended that two efforts to obtain verification 

of clinical privileges held at other institutions be made and 

documented in C&P folders.

Management of 

Test Results

The purpose of this review was to follow up on a previous 

review that identified improvement opportunities related to 

documentation of notification of abnormal test results and 

follow-up actions taken.6

We reviewed the facility’s policies and procedures, and we 

reviewed medical records. We identified the following areas

that needed improvement.

 

Communication of Normal Results. VHA requires facilities to 

communicate normal results to patients no later than 

14 calendar days from the date that the results were 

available to the ordering provider.

7

Documentation of Ordering Provider Notification. VHA 

requires that diagnostic clinicians (laboratory, pathology, and 

radiology) document in the medical record the time and 

means of critical test result communication and the name of 

the ordering provider contacted.

 We reviewed the medical 

records of 67 patients who had normal results and found that 

only 47 (70 percent) records contained documented 

evidence that the facility had communicated the results to 

the patients within the specified timeframe. 

8

Recommendations

 We reviewed the medical 

records of 20 patients who had critical or abnormal pathology 

results and found that pathology clinicians documented 

the time the ordering provider was notified in only 

15 of the 20 records. 

6. We recommended that normal test results be 

consistently communicated to patients within the specified 

timeframe.

7. We recommended that pathology clinicians consistently 

document the time critical or abnormal pathology results 

were communicated to ordering providers.
CAP Review of the VA Palo Alto Health Care System, Palo Alto, CA

VA OIG Office of Healthcare Inspections 6 

 

9 Colonization is the presence of bacteria in the body without causing clinical infection.

Management of 

MDRO

The purpose of this review was to evaluate whether the

facility had developed a safe and effective program to reduce 

the incidence of MDRO in its patient population in 

accordance with applicable requirements. 

We inspected the medical/surgical (2A) and SCI (7E and 7F) 

units at the Palo Alto division and the CLC units at the 

Livermore and Menlo Park divisions, and we interviewed 

employees. We did not identify any deficits in either the 

inspections or staff interviews. However, we identified the 

following areas that needed improvement.

Patient/Family Education. The JC requires that patients 

infected or colonized9

Employee Training. Facility policy requires designated staff 

to have annual MDRO training. We reviewed the training 

records of 42 designated employees and found that only 

24 (57 percent) of the records had documentation of annual 

MDRO education. 

with MDRO and their families receive 

education on infection prevention strategies, such as hand 

washing and the proper use of PPE. We reviewed 

25 medical records and found that only 8 had documented 

evidence of MDRO education.

Recommendations 8. We recommended that infection prevention strategies 

education be provided to patients infected or colonized with 

MDRO and their families and that the education be 

documented.

9. We recommended that employees received annual 

MDRO education and that the training be consistently 

documented.

COC The purpose of this review was to evaluate whether the 

facility managed advance care planning, advance directives, 

and discharges in accordance with applicable requirements. 

We reviewed patients’ medical records for evidence of 

advance care planning, advance directives, and discharge 

instructions. We identified the following area that needed 

improvement.

Advance Directive Notification. VHA requires that the facility 

provide patients with written notification at each admission to 

a VHA facility of their right to accept or refuse medical 
CAP Review of the VA Palo Alto Health Care System, Palo Alto, CA

VA OIG Office of Healthcare Inspections 7 

 

10 VHA Handbook 1004.02, Advance Care Planning and Management of Advance Directives, July 2, 2009.

treatment, to designate a Health Care Agent, and to 

document their treatment preferences in an advance 

directive.10

Recommendation

 This notification must include the statement that 

VA does not discriminate against patients based on whether 

or not they have an advance directive and must be 

documented in the patient’s medical record. We reviewed 

10 medical records, and none had documentation of

advance directive notification.

10. We recommended that written advance directive 

notification be provided to patients and documented in the

medical record.

Medication 

Management

The purpose of this review was to determine whether the 

facility employed safe practices in the preparation, transport, 

and administration of hazardous medications, specifically 

chemotherapy, in accordance with applicable requirements. 

We observed the compounding and transportation of 

chemotherapy medications and the administration of those 

medications in the infusion clinic, and we interviewed 

employees. We identified the following area that needed 

improvement.

Clean Inner Gloves. The American Society of 

Health-System Pharmacists requires that staff wear clean 

inner gloves when labeling and placing the final preparation 

into the transport bag. The pharmacy technician preparing 

the chemotherapy infusion had clean inner gloves but did not 

remove the contaminated outer gloves prior to affixing the 

label to the chemotherapy infusion bag. The pharmacy 

technician removed the outer gloves only after placing the 

chemotherapy infusion into the transport bag.

Recommendation 11. We recommended that pharmacy staff wear clean inner 

gloves when labeling and placing the chemotherapy infusion 

into the transport bag.

Review Activity Without Recommendations

EOC The purpose of this review was to determine whether the 

facility maintained a safe and clean health care environment 

in accordance with applicable requirements.

At the Palo Alto division, we inspected selected inpatient 

(medical, surgical, intensive care, MH, CLC, polytrauma, and 
CAP Review of the VA Palo Alto Health Care System, Palo Alto, CA

VA OIG Office of Healthcare Inspections 8 

SCI) units, the outpatient surgical unit, primary care clinics,

the women’s health clinic, and the radiology department. At 

the Livermore division, we inspected the CLC unit, selected 

primary and specialty care clinics, and the radiology 

department. At the Menlo Park division, we inspected the 

CLC units in buildings 331 and 360. The facility maintained 

a generally clean and safe environment. We made no 

recommendations.

Comments

The VISN and Facility Directors agreed with the CAP review findings and 

recommendations and provided acceptable improvement plans. (See Appendixes D 

and E, pages 14–20, for the full text of the Directors’ comments.) We consider 

Recommendations 5, 7, and 11 closed. We will follow up on the planned actions for the 

open recommendations until they are completed.
CAP Review of the VA Palo Alto Health Care System, Palo Alto, CA

Appendix A

VA OIG Office of Healthcare Inspections 9 

Facility Profile11

Type of Organization Tertiary care medical center

Complexity Level 1A

VISN 21

CBOCs San Jose, CA

Monterey, CA

Capitola, CA

Stockton, CA

Modesto, CA

Sonora, CA

Fremont, CA

Veteran Population in Catchment Area 255,348 

Type and Number of Total Operating Beds:

• Hospital, including PRRTP 301

• CLC/Nursing Home Care Unit 360

• Other (Domiciliary) 172

Medical School Affiliation(s) Stanford University School of Medicine

• Number of Residents 750

Current FY (through

December 2010)

FY 2010

Resources (in millions): 

• Total Medical Care Budget $811.8 $755.1

• Medical Care Expenditures $205.5 $742.7

Total Medical Care FTE 3,628.5 3,555.9

Workload: (business)

• Number of Station Level Unique 

Patients

40,774 62,566

• Inpatient Days of Care:

o Acute Care 18,448 74,978

o CLC/Nursing Home Care Unit 25,538 103,523

Hospital Discharges 2,482 9,899

Total Average Daily Census (including all bed 

types) 

665.4 699.4

Cumulative Occupancy Rate 75.4% 80.4%

Outpatient Visits 171,093 683,907

 

11 All data provided by facility management.
CAP Review of the VA Palo Alto Health Care System, Palo Alto, CA

Appendix B

VA OIG Office of Healthcare Inspections 10

Follow-Up on Previous Recommendations

Recommendations Current Status of Corrective Actions 

Taken

In Compliance 

Y/N

Repeat 

Recommendation? 

Y/N

QM

1. Review all physicians’ privileges to 

ensure that current privileges match current 

work, privileges are signed off by the 

appropriate chiefs, reference sources reflect 

correct privileges, and changes in work 

assignments are accompanied by 

commensurate privilege changes. 

Service chiefs review all requested 

privileges during initial appointment and 

reappointments to ensure that current 

privileges match current work. The 

medical staff office monitors signatures 

and privilege changes due to change in 

work assignments.

Y N

2. Develop a mechanism to discuss all 

cases where review processes might identify 

adverse events, and document full 

disclosure as appropriate.

A tracking system was developed and 

implemented. Adequate processes are 

in place to appropriately consider 

cases for disclosure.

Y N

3. Develop plans for continuous 

performance review, including providerspecific QM/PI results, and maintain provider 

profiles that show compliance with plans.

Service chiefs have developed servicespecific criteria, and profiles contain 

adequate data.

Y N

Pharmacy Operations and CS Inspections

4. Ensure that weekly inventory checks are 

performed in all appropriate areas and that 

the checklist and local policy are updated.

Facility policy was revised, eliminating 

the weekly inventory or verification for 

automated units. This is consistent 

with VHA Handbook 1108.02. 

Y N

5. Appoint a sufficient number of CS 

inspectors to meet all program requirements. 

The facility has a sufficient number of 

trained CS inspectors to support the 

CS Inspections program. 

Y N
CAP Review of the VA Palo Alto Health Care System, Palo Alto, CA

VA OIG Office of Healthcare Inspections 11

Recommendations Current Status of Corrective Actions 

Taken

In Compliance 

Y/N

Repeat 

Recommendation? 

Y/N

6. Reappoint CS inspectors according to VHA 

policy, and ensure all CS inspectors complete 

required annual certifications and possess 

current letters of designation.

Inspectors have current certifications 

and appointment letters as required. 

(There have been no reappointments.)

Y N

Medication Management

7. Ensure nurses consistently document the 

effectiveness of all pain medications within 

the required timeframe.

Pain effectiveness training outlining 

documentation requirements is

provided to licensed nursing staff 

during orientation and annually. 

Periodic audits of pain effectiveness 

documentation show good compliance.

Y N
CAP Review of the VA Palo Alto Health Care System, Palo Alto, CA

Appendix C

VA OIG Office of Healthcare Inspections 12

VHA Satisfaction Surveys

VHA has identified patient and employee satisfaction scores as significant indicators of 

facility performance. Patients are surveyed monthly. Table 1 below shows facility, VISN, 

and VHA overall inpatient and outpatient satisfaction scores and targets for FY 2010. 

Table 1

FY 2010

(inpatient target = 64, outpatient target = 56)

Inpatient 

Score 

Quarter 1

Inpatient 

Score 

Quarter 2

Inpatient 

Score 

Quarter 3

Inpatient 

Score 

Quarter 4

Outpatient 

Score

Quarter 1

Outpatient 

Score 

Quarter 2

Outpatient 

Score 

Quarter 3

Outpatient 

Score 

Quarter 4

Facility 73.8 72.7 76.8 77.4 63.2 63.8 63.0 61.2

VISN 70.5 65.7 72.9 70.2 57.8 58.6 59.3 56.9

VHA 63.3 63.9 64.5 63.8 54.7 55.2 54.8 54.4

Employees are surveyed annually. Figure 1 below shows the facility’s overall employee 

scores for 2008, 2009, and 2010. Since no target scores have been designated for 

employee satisfaction, VISN and national scores are included for comparison.
CAP Review of the VA Palo Alto Health Care System, Palo Alto, CA 

VA OIG Office of Healthcare Inspections 13

Hospital Outcome of Care Measures

Hospital Outcome of Care Measures show what happened after patients with certain 

conditions12

Table 2 

received hospital care. The mortality (or death) rates focus on whether 

patients died within 30 days of their hospitalization. The rates of readmission focus on 

whether patients were hospitalized again within 30 days. Mortality rates and rates of 

readmission show whether a hospital is doing its best to prevent complications, teach 

patients at discharge, and ensure patients make a smooth transition to their home or 

another setting. The hospital mortality rates and rates of readmission are based on 

people who are 65 and older. These comparisons are “adjusted” to take into account 

their age and how sick patients were before they were admitted to the VA facility. 

Table 2 below shows the facility’s Hospital Outcome of Care Measures for 

FYs 2006–2009. 

Mortality Readmission

Heart Attack CHF Pneumonia Heart Attack CHF Pneumonia

Facility 12.87 8.09 15.89 18.97 18.34 15.53

VHA 13.31 9.73 15.08 20.57 21.71 15.85

 

12 CHF is a weakening of the heart’s pumping power. With heart failure, your body does not get enough oxygen and 

nutrients to meet its needs. A heart attack (also called acute myocardial infarction) happens when blood flow to a 

section of the heart muscle becomes blocked and the blood supply is slowed or stopped. If the blood flow is not 

restored in a timely manner, the heart muscle becomes damaged from lack of oxygen. Pneumonia is a serious lung 

infection that fills your lungs with mucus and causes difficulty breathing, fever, cough, and fatigue.
CAP Review of the VA Palo Alto Health Care System, Palo Alto, CA

Appendix D

VISN Director Comments 

VA OIG Office of Healthcare Inspections 14

Department of

Veterans Affairs Memorandum

Date: March 25, 2011

From: Director, Sierra Pacific Network (10N21) 

Subject: CAP Review of the VA Palo Alto Health Care System, 

Palo Alto, CA

To: Director, Los Angeles Office of Healthcare Inspections 

(54LA) 

Director, Management Review Service (VHA CO 10B5 Staff) 

1. Thank you for the opportunity to review the draft OIG CAP report for 

the Palo Alto Health Care System site visit that was conducted in 

February 2011. We concur with the recommendations, and will ensure 

completion as described in the attached plan by the established target 

dates. 

2. If you have any questions regarding the attached response or action 

for recommendations please contact Ms Terry Sanders, VISN 21 

Associate Quality Management Officer at (707) 562-8370. 

(original signed by:)

Sheila M. Cullen

Attachments
CAP Review of the VA Palo Alto Health Care System, Palo Alto, CA 

Appendix E

Facility Director Comments

VA OIG Office of Healthcare Inspections 15

Department of

Veterans Affairs Memorandum

Date: March 25, 2011

From: Director, VA Palo Alto Health Care System

Subject: CAP Review of the VA Palo Alto Health Care System, 

Palo Alto, CA

To: Director, Sierra Pacific Network (10N21)

1. VAPHCS appreciates the opportunity to review the OIG report on the 

CAP Review of the VA Palo Alto Health Care System.

2. Please find attached our response to each recommendation provided

in the report.

3. If you have any questions regarding the response to the 

recommendations in the report, feel free to call me at (508) 858-3939.

 (original signed by:)

Elizabeth Joyce Freeman 

Director
CAP Review of the VA Palo Alto Health Care System, Palo Alto, CA

VA OIG Office of Healthcare Inspections 16

Comments to Office of Inspector General’s Report

The following Director’s comments are submitted in response to the recommendations 

in the Office of Inspector General report:

OIG Recommendations

Recommendation 1. We recommended that the PRC be notified when corrective 

actions are completed.

Concur

Target date for completion: December 31, 2011.

A tracking log for meeting minutes will be provided to update members on the 

completion of action items. Audits will be conducted quarterly times for three quarters 

to ensure the action grid reflects closure of all open action items.

Recommendation 2. We recommended that processes be strengthened to ensure that 

documentation of patient assessment prior to moderate sedation includes all required 

elements. 

Concur

Target date for completion: September 30, 2011.

The Cardiology Section Chief has implemented a plan to address the recommendation 

regarding allergy review and re-evaluation immediately prior to sedation. 

The pre-assessment template will be modified to include an allergy review. All 

physicians and nurses received supplemental education regarding the specific 

requirements outlined in the Moderate Sedation Policy 11-09-46 on Feb 10, 2011. 

Monthly documentation audits were increased to a weekly basis with a target of 

100% compliance. The audit will consist of two cases weekly. This data will 

consistently be reviewed for modification in the monthly QA review in the Cardiology 

department. Target completion date: May 30, 2011. 

The Radiology Section Chief has implemented a plan to address the recommendation 

regarding airway assessment prior to sedation.

Radiology has contacted both Vascular Surgery Service and Nursing Service to 

reinforce the importance of proper pre-procedure evaluation and documentation. The 

Interventional Radiology charge nurses will audit 100% of Vascular Surgery moderate 

sedation cases for one quarter beginning in April, 2011 to achieve 100% compliance 

with all elements of the pre-procedure checklist. This data will consistently be reviewed 

for modification in the quarterly Surgical and other Procedure Committee (SOIP). 

Target completion date: June 30, 2011.
CAP Review of the VA Palo Alto Health Care System, Palo Alto, CA

VA OIG Office of Healthcare Inspections 17

Additionally, random audits of pre-procedure moderate sedation assessment 

documentation will be conducted in all moderate sedation units for two quarters 

beginning April 1, 2011 with a target of 100% compliance. Target completion 

date: September 30, 2011.

Recommendation 3. We recommended that the individual emergency event record 

form be revised to include all required elements and that the form be used for individual 

events and trend analysis in aggregate.

Concur

Target date for completion: September 30, 2011.

The Emergency Event Record form was revised February 10, 2011. We have 

re-introduced the QA elements of CPR technique and equipment problems onto the 

form. An audit of each event will be completed to ensure this information is captured 

100% of the time for 2 quarters beginning April, 2011.

Recommendation 4. We recommended that facility policy and service-specific 

proctoring guidelines be revised to comply with VHA requirements for FPPE for all new 

hires.

Concur

Target date for completion: June 30, 2011.

Local policy will be revised and a new proctoring policy for all clinical services will be 

implemented. The individual Service Chiefs of clinical services are responsible for 

monitoring of all proctoring/FPPE plans. Once the proctor assesses that the applicant 

has fulfilled the proctoring process, a packet will be composed by the Administrative 

Officer of the service, which is signed by the proctor and service chief requesting 

conversion to full medical staff. This packet will be forwarded to the Medical Staff Office

(MSO) to be presented at the Professional Standards Board committee and Medical 

Executive Board for approval by the Chief of Staff and Director. The MSO will track 

proctoring through VistA and will notify services when proctoring needs to be completed 

(conversion) or if extension of proctoring is necessary. Beginning April 1, 2011, this 

practice will be audited for one quarter to achieve 100% compliance.

Recommendation 5. We recommended that two efforts to obtain verification of clinical 

privileges held at other institutions be made and documented in C&P folders. 

Concur

Target date for completion: Consider this closed.

If privileges are not included with each facility’s response, MSO will contact the facility to 

verbally verify that the privileges are in good standing. The verbal response will be 
CAP Review of the VA Palo Alto Health Care System, Palo Alto, CA

VA OIG Office of Healthcare Inspections 18

documented and placed in the Credentialing and Privileging folder. The document is 

then scanned into VetPro and subsequently closed out.

Recommendation 6. We recommended that normal test results be consistently 

communicated to patients within the specified timeframe.

Concur

Target date for completion: September 30, 2011.

VAPAHCS currently follows our lab results directive. A Patient Health Journal is shared 

with the Veteran that includes lab results. Patients are also notified within the 14 day 

time period by phone and/or letter.

Auditing of compliance will occur using our Ambulatory Care clinical review process. 

Notification to patients of normal test results is an item that has been added to the 

review form. This is the same process that is used for medical record compliance and 

clinical practice guideline compliance. The audit consists of five medical record 

reviews/provider/quarter. We will continue to audit indefinitely but will report audit 

findings for the next two quarters to the Medical Executive Board.

Recommendation 7. We recommended that pathology clinicians consistently 

document the time critical or abnormal pathology results were communicated to 

ordering providers.

Concur

Target date for completion: Consider this closed.

Effective January 1, 2011, Pathology and Laboratory Medicine Service (PLMS) policy 

was changed to require that critical or abnormal pathology results be reported to the 

ordering provider team verbally. PLMS has identified new/first-time cancer diagnoses 

as a critical or abnormal pathology. The report must include who was notified, by whom 

and when notification occurred. All staff was educated about this requirement. Monthly 

monitoring began in January 2011, with a goal of 100% compliance.

Cases signed out in January, 2011: 28 cases had documented notification, 3 cases had 

no documentation (90% compliance).

Cases signed out in February 2011: 26 cases had documented notification, 2 cases had 

no documentation (93% compliance).

Cases signed out as of March 15, 2011: 10 cases had documented notification, 0 cases 

had no documentation (100%).

Monthly auditing will continue indefinitely with a compliance goal of 100% and the 

results will be reported to the PLMS QA Committee and will be included in the PLMS 

annual report to the MEB. This action item has been completed.
CAP Review of the VA Palo Alto Health Care System, Palo Alto, CA

VA OIG Office of Healthcare Inspections 19

Recommendation 8. We recommended that infection prevention strategies education 

be provided to patients infected or colonized with MDRO and their families and that the 

education be documented.

Concur

Target date for completion: September 30, 2011.

Infection Control will develop a procedure to identify inpatients with positive tests for

MDRO and communicate with appropriate units/providers to provide the necessary 

education. A standardized patient education template is being developed that will 

capture documentation of MDRO education given to all patients testing positive.

Once these two processes are developed, Infection Control will coordinate an 

educational program to inform providers and nursing staff of this requirement and how it 

will be met. Anticipated start date: April 4, 2011.

Beginning in May, 2011, compliance will be evaluated through chart reviews of identified 

patients with MDRO colonization/infection. 90% or higher compliance will be achieved 

by September 30, 2011.

Recommendation 9. We recommended that employees receive annual MDRO 

education and that the training be consistently documented.

Concur

Target date for completion: September 30, 2011.

This training is tracked on LMS. A local module was created and assigned to clinical 

employees as an annual training beginning in January, 2011.

Infection Control will monitor and identify services which are not meeting at least a 

90% completion rate and work with appropriate Administrative Officers for corrective 

action.

Recommendation 10. We recommended that written advance directive notification be 

provided to patients and documented in the medical record.

Concur

Target date for completion: September 30, 2011

Patients will be given written notification about Advance Directives by the nurse who is 

completing the nursing admission assessment. The form, titled “Your Rights Regarding 

Advance Directives” will be implemented starting April 15, 2011. 

The nursing admission assessment template will be modified to include a written 

statement confirming written notification was provided to the patient by the nurse 
CAP Review of the VA Palo Alto Health Care System, Palo Alto, CA

VA OIG Office of Healthcare Inspections 20

completing the admission assessment. An audit of inpatient admissions will be 

conducted monthly, times 2 quarters, beginning in April, 2011 to achieve 

100% compliance with Advance Directive notification documentation. Based on Joint 

Commission recommendations 10% of admissions will be audited for Advance Directive 

compliance.

Recommendation 11. We recommended that pharmacy staff wear clean inner gloves 

when labeling and placing the chemotherapy infusion into the transport bag.

Concur

Target date for completion: Consider this closed.

Pharmacy staff is now removing the outer gloves prior to labeling and placing the 

chemotherapy infusion in the transport bag. Education to pharmacy staff regarding 

proper removal of gloves prior to labeling was completed February 10, 2011. 

Compliance has been monitored by the pharmacy supervisor on a weekly basis 

beginning February, 2011 for 2 weeks with a 100% compliance rate. Compliance 

monitoring will continue on a monthly basis in March and April in order to achieve 

100% compliance.
CAP Review of the VA Palo Alto Health Care System, Palo Alto, CA

Appendix F

VA OIG Office of Healthcare Inspections 21

OIG Contact and Staff Acknowledgments

Contact Daisy Arugay, MT

Los Angeles Office of Healthcare Inspections

Contributors Kathleen Shimoda, RN, Team Leader 

Paula Chapman, CTRS

Douglas Henao, RD

Judy Montano, MS

Simonette Reyes, RN

Mary Toy, RN

Julie Watrous, RN

Mike Seitler, Office of Investigations
CAP Review of the VA Palo Alto Health Care System, Palo Alto, CA

Appendix G

VA OIG Office of Healthcare Inspections 22

Report Distribution

VA Distribution

Office of the Secretary

Veterans Health Administration

Assistant Secretaries

General Counsel

Director, Sierra Pacific Network (10N21) 

Director, VA Palo Alto Health Care System (640/00)

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

U.S. Senate: Barbara Boxer, Dianne Feinstein

U.S. House of Representatives: Dennis Cardoza, Jeff Denham, Anna G. Eshoo, 

Sam Farr, John Garamendi, Mike Honda, Zoe Lofgren, Jerry McNerney, 

Jackie Speier, Fortney Pete Stark

This report is available at http://www.va.gov/oig/publications/reports-list.asp.