HEARING 1. VA'S COMPLIANCE WITH YEAR 2000 

REQUIREMENTS 

HEARING 

BEFORE THE 

SUBCOMMITTEE OVERSIGHT AND INVESTIGATIONS 

OF THE 

COMMITTEE ON VETERANS' AFFAIRS 

HOUSE OF REPRESENTATIVES 

44-672 CC 

ONE HUNDRED FIFTH CONGRESS 

FIRST SESSION 

JUNE 26, 1997 

Printed for the use of the Committee on Veterans' Affairs 

Serial No. 105-14 

U.S. GOVERNMENT PRINTING OFFICE 

WASHINGTON : 1998 

For sale by the U.S. Government Printing Office 

Superintendent of Documents. Congressional Sales Office, Washington, DC 20402 

ISBN 0-16-056138·8 
COMMITTEE ON VETERANS' AFFAIRS 

BOB STUMP, Arizona, Chairman 

CHRISTOPHER H. SMITH, New Jersey LANE EVANS, Illinois 

MICHAEL BILIRAKIS, Florida JOSEPH P. KENNEDY II, Massachusetts 

FLOYD SPENCE, South Carolina BOB FILNER, California 

TERRY EVERETT, Alabama LUIS V. GUTIERREZ, Illinois 

STEVE BUYER, Indiana JAMES E. CLYBURN, South Carolina 

JACK QUINN, New York CORRINE BROWN, Florida 

SPENCER BACHUS, Alabama MICHAEL F. DOYLE, Pennsylvania 

CLIFF STEARNS, Florida FRANK MASCARA, Pennsylvania 

DAN SCHAEFER, Colorado COLLIN C. PETERSON, Minnesota 

JERRY MORAN, Kansas JULIA CARSON, Indiana 

JOHN COOKSEY, Louisiana SILVESTRE REYES, Texas 

ASA HUTCHINSON, Arkansas VIC SNYDER, Arkansas 

J.D. HAYWORTH, Arizona CIRO D. RODRIGUEZ, Texas 

HELEN CHENOWETH, Idaho 

RAY LAHOOD, Illinois 

CARL D . COMMENATOR, Chief Counsel and Staff Director 

SUBCOMMITTEE ON OVERSIGHT AND INVESTIGATIONS 

TERRY EVERETT, Alabama, Chairman 

BOB STUMP, Arizona 

FLOYD SPENCE, South Carolina 

STEVE BUYER, Indiana 

JAMES E. CLYBURN, South Carolina 

VIC SNYDER, Arkansas 

FRANK MASCARA, Pennsylvania 

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CONTENTS 

Page 

OPENING STATEMENTS 

Chairman Everett .................... ............... ................................................................. 1 

Hon. James E. Clyburn ........................................................................................... 2 

Prepared statement of Congressman Clyburn ........ ..................... .................. 33 

Hon. Frank Mascara .......................... ............................... .... ................. .................. 3 

Prepared statement of Congressman Mascara ....... .... ................. ......... ......... 45 

Hon. Lane Evans, Ranking Democratic Member, House Veterans' Affairs 

Committee ..... ...... ............. .... ...... ....... .. ...... ............... ... .......... ... ...... ............. .... .... .. 48 

Hon. Luis V. Gutierrez ............................................................... ...... ....................... 50 

WITNESSES 

Catlett, D. Mark, Assistant Secretary for Management, Chief Information 

Officer, Chief Financial Officer, Department of Veteran Affairs; accom- panied by David R. Albinson, CIO, Veterans Health Administration, Department of Veteran Affairs; and Newell E. Quinton, CIO, Veterans Benefits Administration .............................................................................................. . 

Hor:.rifo~e~~~~~e~t&!'::~e~~!~i!~ i~··c~~~~~~ f;~~ ··th~ ··S~~··~f"c~iif~~~ nia .................................................................................... ..................................... . Prepared statement of Congressman Horn ........................ ........................... . Shope, Thomas, Ph.D., Acting Director of the Division of Electronics and 

Computer Science, Office of Science and Technology, Center for Devices 

and Radiological Health, Food and Drug Administration .. ........... ...... ............ . Prepared statement of Mr. Shope ........................ .......................................... . Willemssen, Joel C., Director, Information Resources Management, Accounting and Information Management Division, General Accounting Office; ac- companied by Helen Lew, Assistant Director, Information Resources Management, Accounting and Information Management Division; and Leonard 

J. Latham, Technical Assistant Director, Office of the Chief Scientist, AccountiNg and Information Management Division .......... ................................ .. . Prepared statement of Mr. Willemssen .................... .. ..................... .. ........... .. 

MATERIAL SUBMI'ITED FOR THE RECORD 

Newsweek article entitled "The Day the World Shuts Down," June 2, 1997 ..... . 

Charts: 

Year 2000 Or~anization Responsibilities .......... ............................................ .. 

Afy:~-;gg~ .. , .~~~~:. .. ~~ .. ?~~~~~~.i.~~~ ... ~~~ .. ~~~~.~.~~~~~ .. ~~.~~~.~~~~ .. ~~~ Written committee questions and their responses: Congressman Evans to Department of Veterans Affairs ............................. . Congressman Evans to Department of Health and Human Services 

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97 

HEARING 1. VA'S COMPLIANCE WITH YEAR 

2000 REQUIREMENTS 

THURSDAY, JUNE 26, 1997 

HOUSE OF REPRESENTATIVES, 

SUBCOMMI'ITEE ON OVERSIGHT AND INVESTIGATIONS, 

COMMI'ITEE ON VETERANS' AFFAIRS, 

Washington, DC. 

The subcommittee met, pursuant to call, at 9:30 a.m., in room 

334, Cannon House Office Building, Hon. Terry Everett (chairman 

of the subcommittee) presiding. 

Present: Representatives Everett, Clyburn, Snyder, Mascara and 

Evans. 

OPENING STATEMENT OF CHAIRMAN EVERETT 

Mr. EVERE'IT. Good morning. We will come to order. 

Today's hearing will examine if the VA computer systems will 

work or fail after 12:00 a.m. on the morning of the year 2000. 

Many computer systems we use today use a two-digit date to recognize the year. With a two-digit format, computers will fail to operate correctly, because the year 2000 will read 1900. 

GA warns that the payments to veterans with service connected 

disabilities could be severely delayed, because VA's compensation 

and pension systems either halt or produces checks so erroneous 

that the system must be shut down, and the checks must be processed manually. 

Time is certainly running out. Our computer generated display 

on your left is a real time countdown which comes from the 

Internet. It shows how much time is left before January 1, 2000. 

Our low technology back-up display which we prepared in case the 

computer system went down shows how many calendar days, 918, 

are left. 

Will VA's computers crash or shut down, malfunction or compute 

incorrect information? How widespread of a problem will this be? 

What will be the cost of these errors? Will health care be delivered 

to our veterans safely and without interruption? Will their paychecks and pension checks get their safely without interruption? 

We'll examine VA's efforts since they testified on their modernization efforts almost a year ago. It is interesting that the Veterans Benefits Administration made the year 2000 Y2K problem a 

priority only last June. 

Today we will hear from our colleague, Steve Hom, Chairman of 

the Government Reform and Oversight Subcommittee on government management information and technology. We will also hear 

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2 

from the GAO, which has done extensive analysis on the Y2K prob-, lem, governmentwide and in the VA. 

The VA will explain what they have done to address Y2K. Tom 

Shope of the Food and Drug Administration will tell us what actions the FDA is taking to address Y2K issues, to ensure the safety 

and effectiveness of medical devices in the health care industry, including the VA. 

I think we have a pretty full plate for discussion today, and I 

look forward to hearing testimony from all our witnesses. I will 

now recognize the ranking member, Mr. Clyburn. 

Mr. EVERETT. I will now recognize the ranking member, Mr. 

Clyburn. 

OPENING STATEMENT OF HON. JAMES E. CLYBURN 

Mr. CLYBURN. Thank you, Mr. Chairman. I am pleased to join 

with you today in calling for this extremely critical hearing on the 

VA's efforts to achieve Year 2000 compliance. 

The GAO tells us that the VA has a long way to go to solve this 

problem, but not much time to get there. I am encouraged that this 

subcommittee has decided to place a watchful eye on the VA's 

progress in this regard. I am hopeful that, through continued oversight by this subcommittee, we can help to ensure that the VA is 

able to achieve Year 2000 compliance. The purpose of this hearing is to hear a status report from the 

VA on their progress on this critical issue, to underscore our subcommittee's interest and concern, and to make clear this committee's expectation that our deserving veterans will receive uninterrufted benefits and services in the year 2000 and beyond. 

believe it is important to recognize that this is not a problem 

that is unique to the VA. As a recent cover story in Newsweek magazine points out, this is an issue that effects everything from the 

personal computers many of us have in our homes to private business and industry and to nearly every local, State and Federal government across the globe. 

Mr. Chairman, I would ask unanimous consent that the June 2, 

1997 Newsweek cover story titled "The Day the World Shuts Down" 

be included in this year's hearing record. 

Mr. EVERETT. Without objection. [The attachment appears on p. 37.J 

Mr. CLYBURN. It is also important to recognize that the VA has 

been working hard over the past several months to get their act together on this issue. I want to commend these recent efforts and 

want to make it clear that I do not doubt the sincerity of the VA's 

interest in addressing and ultimately solving this vexing problem. 

I must say, however, that the objective views of knowledgeable 

outsiders strongly suggest that the VA's task is more daunting and 

difficult than its written testimony to this subcommittee might 

seem to suggest. 

I would also like to note for the record this morning that the 

Gartner Group, a leading independent industry group, has conducted extensive research into the Year 2000 problem and has 

monitored the steps private industry and government have taken 

to address the problem. 
3 

Unfortunately, scheduling difficulties prevented the Gartner 

Group from providing live testimony before our subcommittee 

today. The Gartner Group has graciously volunteered, however, to 

provide written responses to any questions any of the members of 

this subcommittee may have. 

Mr. Chairman, I ask unanimous consent that subcommittee 

members be allowed 5 business days to provide the committee with 

written questions to the Gartner group and that the responses be 

included in the formal hearing record. 

Mr. EVERETT. Without objection, so ordered. 

Mr. CLYBURN. Thank you. Mr. Chairman, as I stated at the outset of my remarks, the GAO tells us the VA has a long way to go 

to achieve Year 2000 compliance, and the clock tells us they don't 

have much time to get there. 

Through continued close scrutiny and oversight by this subcommittee, I am hopeful that we will remain committed to doing 

what we can to help ensure the VA makes it to the year 2000. 

Thank you, Terry, for your leadership on this issue. 

Mr. EVERETT. Thank you, Jim. 

[The prepared statement of Congressman Clyburn appears on p. 33.] 

Mr. EVERETT. Mr. Mascara, do you have any comment? 

OPENING STATEMENT OF HON. FRANK MASCARA 

Mr. MAsCARA. Yes. Thank you, Mr. Chairman, and thank you for 

calling this hearing this morning to examine a serious VA computer problems. 

Last evening I read over the material provided by the committee, 

and I must say I am most alarmed that, if this problem is not corrected, and corrected quickly, it could result in late benefit checks 

and denied benefits to millions of veterans across America, a situation which this subcommittee cannot tolerate. 

I understand that, since my colleagues on the House Committee 

on Government Reform and Oversight gave the VA a D for its efforts to correct this problem and this hearing was scheduled, the 

VA has begun to move. Those in the know, however, say that the 

plan being developed by the VA is very general and raises more 

questions than it answers. 

I am hoping that today's testimony will help alleviate the committee's concerns and not give us cause for further heartburn. 

The bottom line is that too much is at stake here to even think 

of the VA not getting the problem corrected. Veterans are relying 

on us to keep the pressure on the VA, and you can all rest assured 

we will do exactly that until this problem no longer exists. 

Thank you, Mr. Chairman, and I yield back the balance of my 

time. 

Mr. EVERETT. Thank you very much. 

[The prepared statement of Congressman Mascara appears on p. 

45.] 

Mr. CLYBURN. Mr. Chairman, before we get started, I think it 

may be worth noting that this is Mr. Mascara's first day as a member of this subcommittee. I want to welcome him to the subcommittee. 

Mr. MAsCARA. Thank you, Mr. Clyburn. 
4 

Mr. EVERETI. We certainly do. We do welcome you, and we need 

all the help we can get. 

Mr. MAsCARA. And I'm delighted to be a part of it. 

Mr. EVERETI. I've got great help right here, but I always welcome more. 

Now, of course, I'd like to welcome my colleague, Steve Horn, not 

only a colleague but a classmate. He's Chairman of the Government Reform and Oversight Subcommittee on Government Management, Information and Technology. 

Steve, in the beginning I would say that this is an elusive target. 

I started first having hearings on this as Chairman of the Compensation, Pension, Insurance, and Memorial Affairs Subcommittee 

2 years ago. I think perhaps there's been some movement. We, 

frankly, though, are not near where we need to be, and I'm certainly going to be interested in hearing your testimony this 'morning, if you will please begin. 

STATEMENT OF HON. STEPHEN HORN, A REPRESENTATIVE IN 

CONGRESS FROM THE STATE OF CALIFORNIA 

Mr. HORN. I thank you very much, Mr. Chairman. I'm delighted 

you and I have been colleagues, and they picked the right person 

for the subcommittee chairman, since a publisher who knows what 

an investigation is is certainly worthwhile presiding over one of 

these groups. 

I'm going to skip-read through some of my testimony. I assume 

that's put in the record at this point. 

Mr. EVERETI. The complete testimony will be entered into the 

record. . 

Mr. HORN. Let me just say a few general things, since you're into 

this subject. The year 2000 problem, when our Subcommittee on 

Government Management got into it, the Federal Government had 

hardly paid any attention to it in terms of the Executive branch. 

A few State governors were working on it, Governor Ridge in Pennsylvania, a former colleague here, Governor Wilson in California, 

and some others. 

They brought in chief technology officers to pull things together. 

So the States were a little ahead of us, and we thought we would 

see what's going on in 24 departments and executive agencies, and 

I believe you have the results before you. Counsel for this study on my right, Mark Uncipher, has been 

with this for a year and a half now, and our 16th report of the full 

committee is about this subject. So I commend it to you and the 

staff, and our 24 agencies and the grades we gave them are in 

there. The Veterans Affairs Agency got a D. There were four basic questions we asked at that time: Has the agency a Year 2000 plan? The 

answer out of Veterans Affairs was no. Is there a Year 2000 program manager that's been appointed to get some direction and 

focus in this area? Now Veterans Affairs did say they had that. 

Now does the agency have any cost estimates for the Year 2000 

solution? No, big blank. Did you answer the rest of the questions 

we asked, which were about 11 or 12 other questions? They did answer those. 
5 

When we went through this, we only had four A's in the whole 

Executive branch, Agency for International Development, Office of 

Personnel Management, Small Business, and Social Security. 

There were three B's, three C's, 10 D's, four F's. Being a former 

professor, I grade on the absolute. I do not grade on the curve. So 

the D's and F's in many universities would have become C's and 

B-'s, but not here. 

Now that shook them up a little. We had two cabinet secretaries 

that never even heard of the problem. One was the Secretary of 

Energy, and I figured she wouldn't have heard of the problem since 

she was traveling so much, and we were doing a separate investigation on that. 

The one that surprised me was the Secretary of Transportation 

at that time, and he's a very able person, and he hadn't heard 

about, and we didn't know at that time what we know now, that 

one of his key agencies in the Transportation, the Federal Highway 

Administration, had been working on this problem since 1989. 

They were a first, along with Social Security, that's been working 

on the problem since 1989. 

We look to Social Security to be sort of the guards, tackles, everybody else that's running down the field ahead of the other agencies 

and, hopefully, a model; because, as you and I know, if Social Security can't get this problem solved by January 1, 2000, there will be 

435 district offices of members of the House that will have a few 

hundred thousand people saying where's my check, where's my eligibility. This is a very serious question. 

When we started people thought, oh, well, you know, what's this 

all about, science will solve it. Science hasn't solved it. Now all of 

this happened, as we know-and I remember using those computers in the university 20-25 years ago. We had very little storage capacity, and somebody had the bright idea, hey, we can save a few 

things here and there. Instead of having 1966, let's just put in 

1966. 

So you put in 1966, and you can't get the whole thing in. So 

when you get to the year 2000, you got two zeroes there, and the 

computer doesn't know what to do. Sounds crazy, but it's there. 

Nobody has solved the problem yet. If there is a simple solution, 

they will be a billionaire overnight, because as Gartner testified 

when they appeared before us, a consultant group, fairly widely 

recognized, it's a $600 billion worldwide problem. 

We're half the computers in the world. It's a $300 billion U.S. 

problem, private, nonprofit, governmental. The Federal Government, they estimated, was a $30 billion problem. My instinct said 

I don't think it's that much, but it's something serious. 

As I ought to say, I'm the least knowledgeable person probably 

in the Congress on computers. So don't take my instincts as gospel, 

but the fact is that we asked through the Appropriations Subcommittee for the budget director, in submitting the President's 

budget for Fiscal Year 1998, to give us an estimate of what they 

think it is. 

Now Mr. Raines has done an excellent job in getting the Executive branch to take this issue seriously. He's the first one that really ran with it, and he also, I think, agrees with what I've been say-
6 

ing. Don't send us a big budget request and waste a year up here 

going through the process; reprogram money, and get on it now. 

He has taken exactly that philosophy, and the people in the Executive branch have received the message, get with it, don't just 

whine about it. I think that is very important. Anyhow, he got into it when he was nominated and confirmed for 

Director of Office of Management and Budget, and he started getting some quarterly reports from them. Then he put up his estimate for the budget for Fiscal Year 1998, and generally it was $2.3 

billion. Well, I started laughing at that one. That was just plain too 

low, and my instincts, I think, are right on that; because I then 

held a hearing. 

Assistant Secretary Paige, General Paige of Defense, said, well, 

$1 billion of that 2.3 of his is from the Department of Defense, and 

we haven't even started assessing anything. Now the Department 

of Defense has some very complex problems. They don't even know 

the extent of them yet, but they are working on it, and I suspect 

when this gets all sorted out, it will be somewhere between $10-

15 billion problem. 

Now there is a timetable that the Director of OMB has set and, 

as you look at it, you start worrying, because some of it is pushed 

right up into 1999. Now anyone that's ever dealt with massive computer purchases and implementation-and I have, both as a university president and as an oversight chairman where we've had 

such wonders to look at as the IRS's $4 billion mess, and when I 

was on the Aviation Committee chaired by Mr. Oberstar in the 

103rd, he took a couple of us out to look at the FAA boondoggle, 

and you could walk in the room and see that it was a boondoggle, 

and they were at the $4 billion point, too. 

I've asked both those agencies, why can't you learn something at 

the $4 million, $40 million, $400 million point? Why does it seem 

to have to go to $4 billion. It's because they have had poor management, and everybody that had a bright idea overnight starts changing the thing, and there was no focus. 

You can't be up to the latest point in time. You're always going 

to be behind in the advance of technology, and they need to realize 

that. 

So what we have been after is working with OMB in a sort of 

joint questions that go out. They share them with us. We just have 

the new batch in. We will be grading those and probably releasing 

it sometime in July. We want to take a very careful look and be 

very fair about it, because I think a lot of the agencies do now have 

the message. 

I think, when you look at the Veterans one, as I mentioned, they 

really only had two of four base categories the last go-around, and 

we would hope by that time that there would be progress; but I 

also find the comments contained in the GAO testimony that you're 

going to hear today very troubling. 

I don't want to steal the General Accounting Office's thunder, but 

I'd be concerned that there is not yet a complete inventory of local 

computer applications, that there's not a better system for 

prioritizing mission critical applications and that there are not contingency plans for systems failing, and they inevitably will. 
7 

I've seen this across America in universities that had millions 

spent on student registration. The whole system breaks down, and 

the poor little old ladies that have been running registration for 

years get called back from retirement to go back and do it the old 

way where you stand in lines for 3 days. 

So we need contingency plans that work, and I think that's about 

it for the once over lightly, and I commend you for keeping after 

the agency under your jurisdiction. 

[The prepared statement of Congressman Hom appears on p. 52.] 

Mr. EVERETT. Thank you very much, Steve. 

Before I go into some questions, I'd like to mention we've been 

joined by the full committee ranking member, Lane Evans, who 

was also the very able chairman of this committee before it was 

disbanded a couple of years ago. His knowledge and expertise and 

the desire he has for our veterans is well known here on the Hill. 

Steve, you bring up several interesting foints, and one that I discussed a little bit with VA is trying to nai down source code, where 

it is, who has it, who has the ability to write it. From what I've 

been able to gather, source codes are changed in a number of different regions and places. 

That has led partially to the problem that we have now in trying 

to, number one, find where the source code is; and, number two, 

once you get a number of different people changing source code on 

a program, then you have people working at cross-purposes. 

Seems to me, it would be much better off-I don't know if this 

exists in other agencies or not, but it would be much better off 

when we approach solving this problem if we centralize where 

these changes can be made rather than having, as you mentioned 

a minute ago, anybody that came up with a bright idea made a 

change. 

Would you have any comment on that? 

Mr. HORN. Well, not really. I think you need to get in a panel 

of experts, but I do know this, that when you have millions of lines 

of code that you've got to work your way through and ask the question, does this agency need this to carry out its operations-and Social Security would be a good group to have in. They've worked 

with this. 

They have millions and millions of lines of code. They estimate 

at Gartner why they got to $600 billion was that it would be about 

the cost of a dollar to look at each line, when you take in the wages 

of the people involved. 

In solving this, this is not simply a money problem. This is a 

human resource problem, because as we get nearer and nearer to 

1999, there's going to be a lot of panic set in in the private sector, 

which we're also trying to alert, and nonprofits, local State governments, so forth, that might have been lagging along. 

'fhat means the cost of those experts that know how to bring up 

the code, deal with it, and adjust it will be goinf up and up. That's 

why we might well have a $300 billion nation a problem here, but 

if we do this now in an orderly manner, maybe the problem can 

be solved without the scarcity of resources and talented people not 

being around to solve it. 

Mr. EVERETT. We are also concerned about the problem of embedded chips, particularly those with medical devices that may 
8 

malfunction because of the Year 2000 problem. What more should 

Congress be doing to improve the awareness and response to this 

problem that, while it may be small, it could be critical? 

Mr. HORN. Yes. I think you ought to get in a panel of people from 

the industry. We worry about the medical device problem and the 

embedded chip also, and that's where the assessment of these 

agencies is so very crucial. 

If you're dealing with huge hospital systems, as the services have 

and the VA has, that might compound your problem many times 

over, and we're just not aware of it. 

So all I can commend to you is go out and get some good people 

that know something about the technology to talk to the experts as 

they are grappling with these questions. As I say, time is the significant limiting factor here. The clock keeps ticking, whether we're 

acting or not. 

Mr. EVERETT. Mr. Clyburn. 

Mr. CLYBURN. Mr. Chairman, I have a question, but I wondered 

if I ought to yield to the ranking-I do have a question, Mr. Horn. 

Have you taken a recent look at the VA and seen where they are 

today as opposed to where they were when they received the D 

grade? 

Mr. HORN. Well, we have not come out with the latest. We did 

have the chief technology officer, chief information officer for the 

VA, before us in a panel; but I couldn't give you a grade at this 

point. We just haven't sat down and looked at the pieces, and I 

don't like to shoot from the hip. 

Mr. CLYBURN. I appreciate that, but I just wondering if you had 

taken a look at it. 

Mr. HORN. No. We are--

Mr. CLYBURN. I think I've made a B or two in my lifetime but, 

fortunately, I didn't stay down there. I was just wondering whether 

or not any movement had been made, according to your assessment. 

Mr. HORN. Well, I think all agencies are now moving after our 

little April 1996 hearing and the grading during the summer, but 

the question is how fast are they moving. We don't really have that 

information until we go through this latest report, but the key is 

pinning responsibility, getting organized, and starting to make the 

basic assessment. 

You asked about the embedded chips. That's exactly the problem 

there. I understand that, really, the percentage of devices in equipment may be only 2 to 5 percent, and they may be affected. They 

may malfunction. However, in some pieces of equipment such as a 

medical device, with that being in there that's a catastrophic situation, and you might just not-you might overlook that, if you don't 

think about it hard. 

Mr. CLYBURN. Well, I want to commend you for looking into this 

matter, and I think that, from what I hear, you and ranking member Maloney have been very diligent, and I commend you for it. 

Mr. HORN. We've had 100 percent cooperation from everybody. 

Mr. CLYBURN. Thank you. That's all I have, Mr. Chairman. 

Mr. EVERETT. Thank you, Jim. I would say for the record that 

our colleague, Congresswoman Maloney, was scheduled to appear 
9 

here and was unable to do so at the last minute, and we will welcome here testimony for the record. 

Lane? Oh, I'm sorry. We do come-first come, first served. All 

right, Lane. 

Mr. HORN. I want to say to the gentleman from Pennsylvania, we 

miss you, Frank. Why did you leave us? We could use you. 

Mr. EVERE'IT. Don't we need him? 

Mr. EVANS. Mr. Chairman, I want to thank you and the ranking 

member for holding this hearing and to thank our colleague from 

California for joining with us. We hope we'll continue to tag team 

with you as we progress, hopefully progress, on this issue. 

What's our next step? When do the next report cards come out? 

Mr. HORN. July. We want a chance to look at the data-the data 

has just come in-and really go over it thoroughly, perhaps send 

Mr. Uncipher and some others on the team out to some of the 

agencies. 

Mr. EVANS. Thank you, Mr. Chairman. 

Mr. EVERE'IT. Thank you, Lane. 

Steve, we certainly appreciate your enlightening testimony. We 

also appreciate your dedication to this subject matter. It's not a 

very romantic thing that gets a lot of attention, but it's a most critical thing that could cause this nation great harm and great, great 

expense if we don't get the problem solved, and I share your pessimism in the way we're moving right now. 

Thank you for coming. 

Mr. HORN. Well, if every authorizing committee does what Veterans Affairs is doing, we don't have to worry. 

Mr. EVERE'IT. Thank you very much. 

Mr. EVERETT. I'd like to introduce our second panel, Mr. Joel 

Willemssen, Director, Information Resources Management, Accounting and Information Management Division of the GAO, and 

ask him to please introduce his panel. 

STATEMENT OF JOEL C. WILLEMSSEN, DIRECTOR, INFORMA· 

TION RESOURCES MANAGEMENT, ACCOUNTING AND INFORMATION MANAGEMENT DIVISION, GENERAL ACCOUNTING 

OFFICE; ACCOMPANIED BY HELEN LEW, ASSISTANT DIREC· 

TOR, INFORMATION RESOURCES MANAGEMENT, ACCOUNT· 

ING AND INFORMATION MANAGEMENT DIVISION; AND 

LEONARD J. LATHAM, TECHNICAL ASSISTANT DIRECTOR, 

OFFICE OF THE CHIEF SCIENTIST, ACCOUNTING AND IN· 

FORMATION MANAGEMENT DIVISION 

Mr. WILLEMSSEN. Thank you, Mr. Chairman, ranking member 

Clyburn, ranking member Evans, Congressman Mascara. Thank 

you very much for inviting us here today to testify on VBA's efforts 

to address the Year 2000 computing issue. 

Accompanying me are Helen Lew, Assistant Director, and L.J. 

Latham, Technical Assistant Director. 

As requested, I will briefly summarize our statement. 

As with other agencies, VBA could face widespread computer system failures as the Year 2000 nears, due to the use of two digits 

to represent the year. More than most other agencies, however, 

VBA's failure would be felt by millions of people if the benefits and 

services on which they rely were disrupted. 
10 

Eligibility for many of these benefits and services is date-dependent, which places their delivery at risk. Especially susceptible to 

disruption could be compensation and pension systems that relate 

dates to benefits, such as dates of birth or military service. 

VBA recognizes that the Year 2000 computing issue poses a serious challenge to them. Its information resources management plan 

clearly states that achieving Year 2000 compliance is the agency's 

number one priority. 

VBA has also initiated actions to assess its vulnerability and perform the modifications that must be made to its information systems. However, several substantial risks remain. 

In a report issued to you, Mr. Chairman, and being released publicly today, we detail these risks, and I'd like to briefly highlight 

a few of those. 

First, the structure of VBA's Year 2000 program management office needs strengthening, and technical and managerial issues need 

to be addressed. An agency level program office is needed to coordinate and manage the full range of interdependent information systems activities. 

A critical technical deficiency is VBA's lack of an overall systems 

architecture or blueprint to guide and constrain the development of 

replacement systems and the evolution of related systems. 

Second, much work remains to be done in determining whether 

VBA's information systems and their components are Year 2000 

compliant now. VBA expected to have completed all of its inventories of systems by September 30, 1996. However, by that date inventories had only been completed for software applications at its 

three systems development centers. 

According to VBA, part of the reason for the delay in completing 

inventories is the agency's loss of well qualified employees to retirement during recent agency buyouts. VBA's inventory also does not 

include local applications developed by regional offices. 

According to VA's own Year 2000 readiness review, without a 

complete inventory of regional applications, VBA cannot adequately 

predict or plan for the impact of the Year 2000. 

Third, VBA has not developed contingency plans for all of its critical systems. Three of its major business areas currently lack contingency plans to ensure continued operations in the event of Year 

2000 failures. 

Fourth, VBA does not yet have sufficient information about the 

costs and risks associated with its Year 2000 activities. As a consequence, it lacks the information necessary to make decisions 

about prioritizing its information technology projects. 

Given the serious risks associated with VBA's Year 2000 activities, our report recommends that the Secretary take ten specific actions to help ensure the agency's success in making its systems 

Year 2000 compliant. 

In commenting on a draft of our report, the Secretary stated that 

he concurred with all of our recommendations. We also note that 

VA's and VBA's CIOs took quick action to address areas of concern 

that we've identified. As we've said in our report, we're very encouraged by these steps. 
11 

That concludes a summary of my statement, Mr. Chairman. I'd 

be pleased to address any questions that you or the other members 

may have. [The prepared statement of Mr. Willemssen appears on p. 55.1 

Mr. EVERE'IT. Well, I thank you. I hope our D doesn't go to an 

I, incomplete or something. 

Is it correct to characterize your overall testimony as saying that 

there are serious risks of significant Year 2000 failures that might 

affect our veterans? 

Mr. WILLEMSSEN. That's a fair characterization, but if I may add, 

it's also fair to add that VBA is clearly aware of these risks. 

They've been very responsive to the issues that we've raised, and 

taken action very quickly to try to resolve them, but there are remaining risks. So I think that is a fair characterization. Mr. EVERE'IT. I will add to that that I've been very pleased with 

the private meetings that I've had with those who are charged with 

this responsibility. I'm gravely concerned, though, that we are so 

far behind that we may not have a lot of catch-up time. 

As a matter of fact, given the very tight compliance schedule, 

how much margin of error do we have? 

Mr. WILLEMSSEN. It is very tight. In looking at the schedule, we 

believe that VBA, like other major agencies, has to set aside calendar year 1999 to perform critical testing activities to make sure 

that the fixes that they've put in place are actually going to work 

as needed. Related to this, we think it's very important that VBA identify 

priorities in what systems have to be fixed first, what second, and 

so on, because it may turn out that we run out of time and we can't 

fix everything, and we don't want to be stuck at that point with 

the most critical systems being the ones that aren't fixed. 

Therefore, we think it's very important that priorities be established. 

Mr. EVERE'IT. The VA Year 2000 strategy depends on limited financial and personnel resources. Would you say that that's a recipe 

for failure? 

Mr. WILLEMSSEN. Well, we've been pleased with VBA's recent 

change in their strategy. Actually, we think that the recent change 

is a less risky approach. What they were planning to do originally 

on many of their major systems was hope for new system developments to come on board and replace the existing systems. Instead of that approach, they've now changed the strategy-and 

part of the credit goes to your subcommittee which last year push 

VBA to develop a contingency plan. The VBA contingency plan was 

to try to fix ongoing systems. That has now turned out to be their 

primary strategy, as they realize that we've got to make sure that 

ongoing systems are going to work for the Year 2000. 

Mr. EVERE'IT. Your report reflects the situation only at VBA. 

Mr. WILLEMSSEN. That is correct, Mr. Chairman. That's correct. 

Mr. EVERE'IT. Would you compare the two or where they are, or 

do you have any idea where VHA is? 

Mr. WILLEMSSEN. Unfortunately, we haven't done any assessments on VHA, and I don't therefore have really much of a basis 

to comment. 

Mr. EVERE'IT. Mr. Clyburn. 
12 

Mr. CLYBURN. Thank you, Mr. Chairman. Mr. Chairman, I do not 

wish to take my question too far afield from what we're here for, 

but I-there's something that's puzzling me a little bit, and I want 

to ask the panel. If this problem is not unique to VA, and we know it's not, is 

there any kind of coordination taking place in the entire Federal 

Government through GAO or somebody to ensure that, as we bring 

all of government into compliance, that there is some coordination 

here? Is VA out doing its track and IRS doing its track, and Social 

Security doing its track, and everybody is doing their own thing. It seems to me that's been the failure of government. 

Is there some central place in GAO or somewhere to make sure 

that this whole thing is being coordinated governmentwide? 

Mr. WILLEMSSEN. OMB has set up a separate subcommittee to 

address the Year 2000 issue. It has representatives from each of 

the major departments and agencies. I or a representative from 

GAO also attend those meetings. They are held monthly. The next 

one is this Friday. That has proved to be a good forum to share concerns, and deal 

with strategies to address the problem. So there is definitely sharing of information, sharing of strategies to fix the problem, because 

there is indeed no one magical solution, as was pointed out earlier. 

The difficulty is every agency has a wide range of heterogeneous 

systems, applications, database management systems, telecommunications, and operating systems. There are all different 

kinds and types, and they all require different solutions. So it's a 

big problem that has to be addressed. 

From a governmentwide perspective, OMB has had this subcommittee. I might also point out, we have several reviews, either 

recently completed or ongoing, at agencies where we think the risk 

to the American public is most severe. 

We have ongoing reviews at the Federal Aviation Administration, 

and Department of Defense. We've just completed this review on 

VBA. I testified last monthly on Medicare processing and how they 

were handling the Year 2000 issue. So we're trying to also target 

what we think are the most significant agencies in terms of the impact on the public. Mr. EVERETT. Would the gentleman yield? 

Mr. CLYBURN. Sure, I'd be glad to yield. 

Mr. EVERETT. His question is a very good question. One of the 

concerns that we have is, in fact, will DOD be able to talk to VA, 

and you know, there are so many different systems out there. Who 

is heading up this thing governmentwide? 

Mr. WILLEMSSEN. That is a major concern of ours, too. We are 

pushing VBA to complete as quickly as possible its understanding 

and inventory of all the interfaces and data exchanges it has with 

other entities, and also just within the department itself. 

This is a major issue. In my opinion, based on what I've seen 

thus far, this could turn out to be the Achilles heel within the Federal Government-the data exchange issue. To address data from 

external sources, agencies may have to put in some sort of bridges 

or filters so that data coming in from other systems that they're 

not sure is Year 2000 compliant doesn't come in internally to their 

systems and corrupt the data. 
13 

This is a thorny issue, one that has, I would say, in the last couple of months started to attract much more attention, because 

agencies now are realizing, well, we can fix all of ours, but what 

about the other guy. They have to be concerned about that. Mr. EVERETT. I thank the gentleman for yielding. 

Mr. CLYBURN. Thank you, Mr. Chairman. Thank you for your answer. 

I fmd it very interesting that you said, well, we've been looking 

at VBA but I really can't tell you what's happening at VHA; and 

if you have that problem in that field, what is happening in the 

broad spectrum of things. 

It seems to me in my short experience here that one of our big 

problems is trying to coordinate the various aspects of government, 

and this seems to me to be a great time, a tremendous opportunity, 

to put in place a system that will allow these agencies to talk to 

each other, at least for 100 years; and if we can get them to talk 

to each other for 100 years, we might be able to solve the problem 

ad infinitum. 

Thank you so much, Mr. Chairman. I'll yield back my time. 

Mr. EVERETT. Thank y'ou, Jim. Mr. Mascara. 

Mr. MASCARA. I'd like to continue on with Mr. Clyburn's question 

about coordination. The 2000 issue is not unique to government. 

Does the private sector have a place at the table with the government to jointly try to solve this problem? 

Mr. WILLEMSSEN. Yes. The private sector, in particular what 

we've seen in the banking and financial services industries, many 

of those companies are out addressing this issue. In many respects, 

the government is going to have to rely on private contractors to 

come in and do many of the fixes. 

There are a wealth of tools now that are coming out from the private sector that can enable and help Federal agencies tackle this 

problem in a more expeditious manner. So they are there assisting 

and being able to support the Federal agencies. Mr. MAsCARA. Do we have sufficient resources and funding to 

deal with this? I heard these large numbers, billions and billions 

of dollars. 

Mr. WILLEMSSEN. One of the items that we feel that VBA has to 

identify is to clearly layout all the costs, benefits, and risks of its 

Year 2000 initiatives in detail, so that it can then, from a priority 

setting perspective, balance those against some of its other information technology projects which are also funded. It may turn out that not everything can be funded, and we have 

to look at priorities and see what we can do in times of limited 

budget resources. 

Mr. MASCARA. In my former life I was an accountant, and we 

talked about this as we went into the 1990s, about the problem 

that we would expect in the Year 2000. It's difficult for me to believe that someone hasn't done something sooner to find a solution 

to the problem and that there seems to be some kind of a national 

emergency facing us when we hit the year 2000. Mr. Chairman, 

someone in this Government should call a summit of some sort and 

get the best minds possible in the world to sit down at the table 

to attempt to find a solution to the problem. 
14 

I just can't believe we're sitting here saying that, as Mr. Clyburn 

pointed out, that you're doing something, Social Security is doing 

something, the IRS is doing something. I think it's too massive for 

anyone Agency to do anything. I think everybody needs a place at 

the table to solve this problem. 

Thank you, Mr. Chairman. 

Mr. EVERE'IT. Thank you very much. Mr. Evans. 

Mr. EVANS. Thank you, Mr. Chairman. I also have some of the 

same feelings that my colleagues have. So let me just follow up on 

some of their questions. 

In the GAO's view, does VA know enough at this point to determine whether it has committed adequate personnel and resources 

towards fixing this problem? I understand there have been a lot of 

retirements that you talked about earlier. 

Mr. WILLEMSSEN. They are much further along than they were 

even a few months ago, but they have not fully completed what we 

would term the assessment phase of their Year 2000 program. 

They do not know all the applications, especially out in the field. 

Related to that, it's not clear at this point whether they have a 

full handle on all the staff resources, both internal and external, 

that they mayor may not need. That's why we've been pushing 

them to set priorities as part of that process. 

Mr. EVANS. I understand they have some stated timetables of 

their own at this point. Are those timetables not fully adequate to 

solve this problem? 

Mr. WILLEMSSEN. My overriding concern is that enough time is 

left within 1999 to engage in various testing activities. It's one 

thing to go in and make the fixes, but then we've got to go in and 

see that those fixes are actually going to work, especially when you 

begin integrating those systems with many other systems, both internal and external. 

Until you've tested them in a full operational and integrated environment, you won't know for sure what the results will be. 

Mr. EVANS. All right. Thank you. Thank you, Mr. Chairman. 

Mr. EVERE'IT. Thank you very much. 

I want to thank the GAO for the work that they've done for the 

past 2 years on this. I must say, I attribute this remark to no one 

but the Chair. Unfortunately, I have seen this progress delayed 

and delayed and delayed by turf battles, by a culture that, frankly, 

would not reach out, Mr. Mascara, to some of the best minds that 

we have in this country, an attitude that we can do it ourselves, 

when every outside expert that has looked at says, no, you cannot 

do it yourselves. 

We started this with the ranking member 2 years ago, and we 

have had a very difficult time moving forward, and I'll admit, there 

has been forward movement, and we're very thankful for it. 

Again, I thank you for your testimony. 

Mr. WILLEMSSEN. Thank you, Mr. Chairman. 

Mr. EVERE'IT. I will now introduce the third panel, Mr. Mark 

Catlett, the VA's Assistant Secretary for Management and Chief 

Information Officer and the Chief Financial Officer, and ask him 

to introduce his staff, please. 
15 

STATEMENT OF D. MARK CATLETT, ASSISTANT SECRETARY 

FOR MANAGEMENT, CmEF INFORMATION OFFICER, CHIEF 

FINANCIAL OFFICER, DEPARTMENT OF VETERAN AFFAIRS; 

ACCOMPANIED BY DAVID R. ALBINSON, CIO, VETERANS 

HEALTH ADMINISTRATION, DEPARTMENT OF VETERAN AFFAIRS; AND NEWELL E. QUINTON, CIO, VETERANS BENEFITS 

ADMINISTRATION, DEPARTMENT OF VETERAN AFFAIRS 

Mr. CATLETT. Shall I proceed, Mr. Chairman? 

Mr. EVERETT. Mark, if you would introduce your staff. 

Mr. CATLETT. Well, it's not my staff, but this is Dave Albinson, 

the Veterans Health Administration's Chief Information Officer; 

and on my right, Newell Quinton, the Veterans Benefits Administration's Chief Information Officer. 

Mr. EVERETT. Mark, let me say in the beginning, I was very encouraged at the recent meeting that we had with Mr. Gober and 

the willingness that all of you had to take a very serious and hard 

look at this problem, realizing the consequences that would develop 

if we could not solve it. So we look forward to your testimony here 

today. 

Mr. CATLETT. Thank you, Mr. Chairman. 

Mr. Chairman, members of the subcommittee, it's my pleasure to 

testify today on behalf of the Department of Veterans Affairs, concerning our readiness for Year 2000. We are here today to bring 

the subcommittee up to date on our plans and progress in resolving 

Year 2000 problems. 

I have submitted my full statement to the subcommittee, which 

I ask to be made part of the hearing record. 

Mr. EVERETT. Without objection, so ordered. 

Mr. CATLETT. VA's information systems will provide uninterrupted services supporting the full range of veterans' benefits and 

medical care up to and beyond the year 2000. As VA's Chief Information Officer, I have established close working relationships with 

VA's administration level CIOs, these two gentlemen accompanying 

me today, to lead our effort in the coming year 2000 compliance. 

We are working vigorously to make sure VA's systems will function correctly. VA's strategic approach is to make our existing mission critical systems compliant in their current environment. We 

have identified our mission critical systems and assigned levels of 

priority to the applications supporting those systems. 

As VA's CIO, I'm responsible for overseeing and ensuring the 

completion of the year 2000 project for all VA systems. The VBA 

CIO, VHA CIO, and senior information technology managers in the 

National Cemetery System, and staff offices are responsible for developing specific plans and managing the projects within their respective jurisdictions. Both VBA and VHA have established a Year 2000 project offices 

that report directly to their organization's CIO. These project offices provide for the planning, guidance, oversight and technical 

support for their organizations' Year 2000 effort. 

On March 7, 1997, my office established a detailed internal report to track our progress in addressing Year 2000 problems. This 

monthly report, modeled after OMB's governmentwide Year 2000 

quarterly report, measures the progress of each individual VA application. 
16 

In addition to this formal reporting mechanism, the administration level CIOs and their Year 2000 program officials meet with me 

monthly to provide status reports addressing their successes and 

progress towards meeting their milestones. 

The monthly reports and meetings provide my office early notice, 

should an organization fall behind schedule. This early notice gives 

us the ability to work with the organizations on a corrective action 

to get back on schedule. 

In addition to the monthly feedback I receive, my office is conducting periodic independent assessments of VA's progress in preparing for the year 2000. Last year my office conducted a Year 

2000 readiness review of the major VA organizations. This subcommittee received a copy of the review in February. 

We are planning another similar independent review by a contractor during the first quarter of Fiscal year 1998. 

In managing the overall task, we have prioritized our applications using the three-tiered structure. The first tier includes systems that will directly impact the delivery of medical care and benefits to veterans or are central to the department's mission. 

The second tier includes internal agency systems used to improve 

timeliness and efficiency of administrative processes, operations 

support or producing periodic reports. These are systems whose 

failures would not be deemed as having a direct adverse effect on 

veterans. 

Finally, the third tier includes systems scheduled for discontinuation prior to the year 2000. It may include systems scheduled for 

elimination because there is no further legislative requirement or 

program need to maintain them. 

In addition to our internal activities, we are paying close attention to the services and products we obtain from outside sources. 

VA has been utilizing the interim Federal Acquisition Regulations' 

Year 2000 compliance language since it was issued in January of 

1997. 

Prior to that we used the language recommended by the Federal 

CIO Council Subcommittee on Year 2000. The subcommittee's language was incorporated into the interim FAR. 

At this point I would like to update the subcommittee quickly on 

progress in each of our organizations. The information systems supporting the National Cemetery System are fully year 2000 compliant. 

VBA has completed the assessment phase of its systems. VBA's 

plan is to complete the renovation phase by November of 1998, validation by December of 1998, and implementation by June of 1999. 

Every application has been addressed, and VBA has a fixed solution and a planned fixed day for all of its applications. 

VBA recently awarded four task orders to bring contractor support on board. Three of these task orders are for renovation of applications, and one is for project oversight. They also amended an 

existing task order to increase the level of Year 2000 support for 

their project managers. 

As of the end of May, 38 percent of VBA's applications are renovated and Year 2000 compliant. Another 5 percent of their applications are in testing. 
17 

VHA completed its comprehensive Year 2000 plan on April 30, 

1997. VHA's goal is to complete its assessment, including the nationwide assessment of biomedical equipment at VA medical facilities, by January of 1998. 

VHA's plan is to complete any necessary renovation by July of 

1998, validation by January of 1999, and implementation by October of 1999. 

As of the end of May, 23 percent of VHA's VISTA, what we formerly called DHCP, their Veterans Health Information System and 

Technology Applications, are scheduled for discontinuation. In the 

OMB defmition, these are included in the count as complaint. If we 

are to discontinue them, OMB considers that to be compliant. 

VA, along with other agencies, and the private health care community are consumers of biomedical equipment. The potential Year 

2000 impact on biomedical equipment is a national issue, as has 

been noted here already today, affecting both the private sector and 

Federal health care communities. 

VA recommended to OMB in January that an interagency committee chaired by the Department of Health and Human Services 

be established to deal with this issue. The first meeting of the committee was held in May. The Food and Drug Administration, in 

their role as regulators of medical devices and biomedical equipment, will ensure that these devices are Year 2000 compliant. 

We will coordinate a public awareness campaign with HHS as it 

particularly affects veterans with medical devices in their bodies or 

in use in their homes. Additionally, our patients will be advised as 

to the status of medical center equipment when the work of the 

HHS-Ied committee has identified potential problems. 

The Austin Automation Center has made excellent progress in 

preparing for Year 2000 as well. The AAC, as we call it, provides 

VA-wide information and technology support to all components 

within the department. As of the end of May, 74 percent of all applications they support have been renovated and are Year 2000 

compliant. 

The AAC plans is to have all systems renovated by September 

of 1998, validated by October of 1998, and fully implemented by 

September of 1999. 

Mr. Chairman, the Department of Veterans Affairs is following 

a solid plan that will allow us to continue serving veterans and 

their families without interruption into the next millennium. 

This concludes my opening statement. Mr. Albinson, Mr. Quinton 

and I will certainly be happy to answer your questions or those of 

the members of the committee. 

[The prepared statement of Mr. Catlett appears on p. 71.] 

Mr. EVERETT. Thank you very much, Mr. Catlett. I appreciate 

your testimony. All statements, by the way, will be-entire statements, both from members and all our panels, will be entered into 

the record. 

I again repeat that I was very encouraged at our last meeting in 

my office and the candor-<:andid conversation that we had, and 

along those lines, one of the subjects that we approached-in the 

corporate world, if a major project fails, the managers of that 

project are generally fired. My question to you then and is now: If 

a situation of VA Y2K project-if it fails, who loses their jobs? 
18 

Mr. CATLETT. Well, Mr. Chairman, the three of us most respon- sible for it are sitting before you today. I know the Deputy Secretary made that same commitment that he would be personally 

involved and committed to that success as well. Mr. EVERETT. His comment was that he would be one of the 

first-on the train first, and the rest of you would be right behind 

him. 

Mr. CATLETT. I recall something very much like that. Yes, sir. 

Mr. EVERETT. Well, I want to put that in the record to emphasize 

how critical this committee views this situation. I come out of the 

private world where you either produce or you-and if you don't 

produce, you fail. I, frankly, cannot-I cannot imagine the business 

world tolerating a situ at jon we're in here today, and I wish for you 

to provide for me an actual l~ t that I can enter into the record for 

those who are responsible for this project. [The informat.i;)n follows:] 

Year 2000 Organizational Responsibilities 

The Assistant Secretary for Management, VA's Chief Infonnation Officer (CIO) is 

responsible for overseeing and ensuring the completion of the "Year 2000· project for all 

VA systems. The Veterans Benefits Administration (VBA) and Veterans Health 

Administration (VIlA) CIOs, and senior infonnation technology managers within the 

National Cemetery System and staff offices are responsible for managing the project 

within their respective jurisdictions. 

The following is a chart that provides the names of responsible individuals and their 

relationship within VA. 

O. _ c.u.tI, Acting Aut. 

Sec:nIaIy lor ~nt. 

VACIO 

NadlO. _ . 

DItMY - SecnWy fer IRM. Ooputy CIO 

I -I~I~Q~· H=~::;Ptqect~ I 

I • 

~ , ~~o~· H ~~Prq.etCoordNl« I I : 

: J ~ L. BartIt. I I =!~ Prajoct CoordinoIar I -l ~or.Ofra~ 1--t.~~~~~~~~J. 

Mr. CATLETT. I'll be glad to do that, sir. I would note on your 

comment, this issue does exist for the private sector, and there are 

a lot of people facing the same pressures and same issues. 
19 

Mr. EVERETT. Let me ask you-We also discussed this. Does the 

VA have adequate resources and personnel to achieve 2000 compliance? Will VA achieve total Year 2000 compliance, with the emphasis there on the word total? 

Mr. CATLETT. Sir, as we noted, we have an estimate now of $144 

million. We intend to update that estimate. Our next quarterly report due to OMB is in August. The task orders and the oversight 

activities by contractors that I noted in my statement, particularly 

in VBA will assist us in updating our cost estimates. We intend to 

have an assessment from those contractors by August 1. It will be 

a portion of our updating of that estimate. 

VHA will continue with their assessment that they are scheduled 

to complete in January. I would note that there are several issues 

here, and it's a question of definitions that has been discussed at 

the CIO Council and with OMB. 

We are replacing systems that we have not identified in that estimate, because we began to replace those systems for reasons 

other than Year 2000. I think the same will be true in the biomedical area. 

There's a replacement schedule for all of our equipment that we 

use in our hospitals. If we need to accelerate that because of Year 

2000 problems, that portion we would identify as a Year 2000 cost. 

If it's scheduled to be replaced anyway in 1999, I wouldn't recommend identifying it as a Year 2000 cost, but if it's scheduled to 

be replaced in 2001 and we have to replace it in 1999, then it 

would be a Year 2000 cost. So we will be updating the assessment as we go, and our intention is not to low ball the estimate. 

I would add one other thing, going back to VBA. We spoke briefly 

in your office, as you say, a little more than a month ago, maybe 

2 months ago. I'm encouraged. The subcommittee mark in the 

House appropriations has included an extra $7 million beyond our 

request in the general operating expenses account. It's for several issues, including the possibility of our need for 

more contractor support in our Veterans Benefits Administration 

applications. Our intention is to complete the re-coding, the renovation, as it's being called, of our existing systems by December of 

1998. 

We clearly agree with Mr. Willemssen. A year of testing is required. Not that testing won't begin before that, but we want to 

have re-coding done, essentially completed, so that we can have a 

full year of testing for all the interfaces. 

We've asked, and the committee has responded. We will certainly 

work with the Senate committee to make sure we have the flexibility, because for systems work, as you note here with your clock 

1998 is an important year for us. We can't wait for a 1998 supple- mental next summer. 

If we find out this August that we need funds, more funds than 

we've estimated in 1998, we're trying to ensure that it's included 

in the appropriation completed by the Hill this Summer. 

Mr. EVERETT. Finally, to ask you: You mentioned biomedical. We 

know there are certain safety factors, and we know that we need 

to assure our veterans who have pacemakers, for instance, what 

the situation is. My mother-in-law has a pacemaker, and she has 
20 

that thing checked by the telephone, and I'm sure some of our veterans are in the same situation. 

How does the FY2K situation affect those veterans? 

Mr. CATLE'IT. Could I ask Mr. Albinson to provide that information for you. Thank you. 

Mr. ALBINSON. Thank you. Mr. Chairman, the VA currently supports almost 19,000 veterans with implanted pacemakers, and as 

the single most critical device which also has a date element involved as part of its architecture--

Mr. EVERE'IT. I understand that affects the telephone situation. 

Mr. ALBINSON. Yes, sir. We made a preliminary survey of the 

vendors who supply these biomedical devices to us, and I'm pleased 

to relay to you that, having checked 95 percent of those 19,000 devices, that we have found that they are all compliant at this point. 

Now we're going to go and continue to check that last 5 percent, 

but at this point I can tell you that that problem seems well in 

hand. 

Mr. EVERE'IT. And I'm sure we're getting that word out to our 

veterans, so that they won't worry about it. 

Mr. Clyburn. 

Mr. CLYBURN. Thank you, Mr. Chairman. Let me, if I may, get 

back to your question, Mr. Chairman, how sure we are about 

compliance? 

You mentioned that by August 1997 you were going to make 

some assessment as to whether or not you need more resources? 

Mr. CATLE'IT. That's this August, in 2 months, in less than 2 

months now, 5 weeks. 

Mr. CLYBURN. Do you think that in 2 months you will be able 

to give us a pretty adequate estimation of how much you will need 

to get this done? 

Mr. CATLE'IT. Mr. Clyburn, we have an estimate now of what our 

resources needs are, particularly for our systems work. We do not 

have that for the biomedical, but for our systems work we have an 

estimate now. 

We intend to utilize the contractors in the Veterans Benefits Administration area for their systems work. We intend to get their estimate as well, with the goal being to update the cost estimate to 

complete renovation of our current code by December of 1998, giving us the full year to test. 

So if our estimate is short, we intend to be aware of that with 

an August 1 report from our contractors. So we want to know their 

opinion, in effect, of our estimate. Recognizing that doesn't always 

fit with the schedule in terms of appropriation action, with the 

speed at which appropriation action is being completed, we are 

making known to the Appropriation Subcommittees, both House 

and Senate, that we'd like to have some flexibility in our 1998 appropriation that affects VBA so that we can provide support for our 

recording if the estimate is higher than what we've projected at 

this point. 

Mr. CLYBURN. I think you used a figure of $7 million that's been 

put in, an additional 7 million. 

Mr. CATLE'IT. I just saw this this morning. That's what I understand was the very recent action. I've been on travel a few days, 

but sometime early this week the House Appropriations Sub-
21 

committee has included an additional $7 million beyond the Presi· 

dent's request for the general operating expenses appropriation, 

which funds VBA. 

They are indicating in the report, as I understand-again, that 

these extra funds are for several purposes: Benefits processing improvement, as well as a need for the Year 2000 contractor support. 

Again, if in August we think we need more support than we've 

now projected for 1998, we're very encouraged that at this point the 

House subcommittee has reacted, and we clearly intend to address 

this issue with the Senate subcommittee as well. 

For systems work-1998 is the crunch year. Biomedical, as I see 

it, the crunch year is 1999. 

Mr. CLYBURN. Well, I just wanted to be sure I understood this. 

This is 7 million beyond what you originally thought it would cost. 

Mr. CATLE'IT. No, sir. The committee has added $7 million. We 

do not yet know if we need another million dollars beyond what 

we've estimated. We're going to have--

Mr. CLYBURN. You just asked them to add. 

Mr. CATLE'IT. I didn't ask for a specific amount. I just asked for 

flexibility. They've reached that decision, and they're looking at a 

lot of things; and as I said, it goes beyond just Year 2000. They're 

going to note, but I'm very encouraged they're giving us flexibility. 

So as I said, we have an estimate of our contractor support to 

complete renovation by December of 1998. We have contractors in 

place now that will give us their assessment as well, and we're asking for that by August 1. We'll be glad to-Obviously, we'll share 

that with you. 

So all this is an encouraging factor, is what I'm saying to you. 

I wouldn't look at anyone number right now, other than we do 

have a positive signal from the appropriations subcommittee that 

they recognize and agree this is an issue we need to be ready to 

address quickly. 

Mr. CLYBURN. Right, I agree, but I think you'll find that all of 

the committees and subcommittees up here are real sensitive about 

this, as you can imagine. I think that our colleague said it very 

well. We'll have 435 district offices that-that is, provided all of us 

are around here at that time-that will have real problems with 

this. So we are sensitive to it. 

I just wanted to be sure that the flexibility you're talking about, 

that-it would seem to me that you would have that flexibility 

within your request, and if this is 7 million beyond, that sweetens 

the flexibility quite a bit. 

Mr. CATLE'IT. Yes, sir. We have, as was noted, I think, by Chairman Horn, in general the approach has been that we will have to 

reprogram or shift our funding, instead of trying to wait for the 

1999 budget, particularly in systems work. 

The work has to be well underway now and early in 1998 in 

order for this to be completed. 

Mr. CLYBURN. Explain something to me a little bit, if you could. 

I have in my notes here that $148 million cost estimate over the 

next 3 years. Explain to me what happens if you need additional 

money beyond the Year 2000. I mean, how would all this work? 
22 

Mr. CATLETT. Well, I'm not exactly sure of your question. We will 

reprogram if we need additional funds, and we will update that estimate in August for you. 

Mr. CLYBURN. And that will include the entire--

Mr. CATLETT. It will be the VA-Yes, sir, over this period. As I 

noted, the biomedical estimate I don't anticipate being there by 

then, because the work being done and led by HHS and FDA will 

not be completed. I don't think we'll have sufficient responses to 

give you a satisfactory answer on the biomedical equipment estimate that we need by August. 

Mr. CLYBURN. Oh, so that's going to be another figure? 

Mr. CATLETT. Yes, sir, because I don't think we're going to have 

that in 5 weeks or 6 weeks. 

Mr. CLYBURN. Okay. All right, thank you. 

Mr. EVERETT. Thank you, Jim. Mr. Evans. 

Mr. EVANS. Thank you, Mr. Chairman. Mr. Catlett, I forwarded 

you a series of prehearing questions, and you've raised some additional questions. I do appreciate your responses. 

Mr. CATLETT. Thank you. 

Mr. EVANS. I'd like to ask you a few of those, if I could. Your 

written responses indicate that not all of the interfaces for VBA 

and VHA related programs have been inventoried for Year 2000 

compliance. The Department states that 148 out of 429 VBA interface files have been assessed, and that 57 out of 148 are compliant. 

Eighty-four files are not compliant, and seven files have been 

retired. 

In other words, the VA believes approximately one-third of its 

inventoried files are compliant. The Department also indicates that 

the VBA interface management plan is on target for completing its 

interface inventory by June 30, 1997, just 4 days from now. 

Since the rest of the inventory process is near completion, can 

you give us at least a thumbnail sketch of VBA inventory expectations? Can we expect a similar ratio of compliant versus noncompliant files? 

Mr. CATLETT. I would ask Mr. Quinton to provide that information. 

Mr. QUINTON. Yes, sir. Mr. Evans, the number indicated there, 

the 429 interfaces, is our latest estimate of the interfaces. The 

other number you referred to, 148-we showed that as the number 

that we had looked at to verify whether or not they were compliant, at this point in our review. 

What we're trying to do is continue that process, looking at each 

interface and determining if there's a date issue with the interface. 

In some cases there may not be a date issue; in some cases, there 

may be. We have to look at each and every one of the grou~ of 429 

to verify whether we have a date problem or not, and that s being 

done system by system. 

So the total number of interfaces we determined at this point is 

the 429 interfaces. We will continue to look at each and every one 

of those by system. 

Mr. EVANS. Mr. Catlett, the VA has indicated that VHA is presently creating a profile of interfaces between its systems and other 

systems throughout the VA, other Federal agencies and other commercial systems. You also indicate that VHA has sent a Year 2000 
23 

compliance letter to corporate systems' owners and managers and 

has asked for detailed information on interfaces. 

When did this process of creating an interface profile within the 

VHA begin? How far along are you in the process, and when will 

such a profile be completed? 

Mr. CATLETI. I'll ask Mr. Albinson to provide that. I'm sorry, 

could you repeat the last two questions? 

(Subsequently, the Department of Veterans Affairs provided the 

following information:) 

An initial effort to update VHA's inventory of corporate or national systems! databases began in March 1996. One item of information requested at that time was a listing of data sources that fed each of these systems. A!3 VHA's awareness of the 

Year 2000 problem increased, we decided to verify the existing information and so- licit additional information on out-going interface data. The first VHA Corporate Systems Year 2000 compliance status request letters were sent to System Managers of Record (SMRs) of forty of VHA's Corporate Systems on June 2, 1997. Letters to 

the System Managers of Record of the remaining 129 VHA Corporate Systems were sent on July 21, 1997. These letters requested detailed information on interfaces between VHA Corporate Systems!databases and other systems, and plans for assuring that the exchange of data is Year 2000 compliant. Initial responses are requested by the end of August, 1997. Any necessary follow-up responses will be received by 

October 1997. The assessment phase for all Corporate Systems is scheduled to be 

completed by January, 1998. We are also investigating the interfaces and dependencies of our VISTA programs 

with their environment. VHA will be takin~ steps to ensure they continue to operate correctly by monitoring their integration With other information systems withm VA, 

other Federal agencies and commercial products or equipment. A complete inventory 

of external interfaces to each of the 141 VISTA applications is being conducted and a final assessment is scheduled to be completed by January 1998. VHA is writing to vendors of medical devices and asking them to assess their 

products for Year 2000 compliance. Vendors are being requested to provide a description of all interfaces; the type of data exchanged between these devices and 

interfaces; and plans for assuring Year 2000 compliance. VHA has mailed letters to 

120 vendors of medical devices beginning on June 20, 1997. The first group of those 

vendors was asked to provide a written plan to VHA by July 18, 1997. While re- sponses to date have been limited, those who have responded indicated that their 

equipment would either not be affected by the Year 2000, or that compliance efforts are currently underway. VHA expects to continue to send out letters as more ven- dors are identified. VHA has established an expert panel, Medical Device Integrated Product Team, 

to evaluate and validate these vendor responses affecting medical devices and the 

interfaces connected to these devices. The assessment phase for all Medical Devices 

is scheduled to be completed by January 1998. 

Mr. EVANS. When will the process of creating an interface profile 

within the VHA begin? How far along are we in the process, and 

when will such a profile be completed? 

Mr. ALBINSON. I can provide the actual dates that the letters 

went out and the expected responses for the record. I can tell you 

that it is part of our assessment process which will be completed 

by the end of this calendar year. 

Mr. EVANS. Mr. Chairman, I have a number of other questions, 

rather technical in nature. I'd like to submit them for the record 

and ask that the questions and the responses be made part of the 

record. 

(See p. 87.) 

Mr. EVERETI. Absolutely. Matter of fact, I might add that I think 

the second half of my question on if the VA will achieve total Year 

2000 compliance-I don't think we got around to that, and I also 

have some costs, how much money has been spent so far. I'll ask 

that you submit those for the record also. 
Mr. CATLETT. Certainly. 

(The information follows:) 

24 

AGENCY-WIDE SUMMARY ON OBLIGATIONS FOR 

INFORMATION TECHNOLOGY FOR YEAR 2000 . DEPARTMENT OF VETERANS AFFAIRS 

[In millions of dollars] 

As of June 30, 1997 

FY 1996 FY 1997 FY 1998 FY 1999 

1 Equlrament 

a. a~ital purchases ................ ............. 0 15 15 15 

b. Ot er equipment purchases/leases 0 0 0 0 

Subtotal ................................... 0 15 15 15 

2 Software 

b: gtg!~!:~~~:~~s p~;~h~~~~~~~~~'" 0 10 10 10 

0 0 0 0 

Subtotal .................. ........ ......... 0 10 10 10 

3 Services .... ............................................... 0 2 1 1 

4 Support services ........................ ............. 1 3 3 2 

5 Supplies ................................................... 0 0 0 0 

6 Personnel (comf,ensationlbenefits) ........ 3 19 20 13 

7 Other (DOD on y) ........... ........................ 0 0 0 0 

8 Intra-governmental pafiments ............... 0 0 0 0 

9 Intra-governmental co lections ........ .... .. 0 0 0 0 

10 Total Obligations 1 .... ........................ 4 49 49 42 

11 ~orkyears (~E) .................................. 31.7 355.5 355.5 324.5 

Note: Pending our completion of Year 2000 compliance assessments of vendor provickd com· mercial-off-the-shelf products, including hardware and software, additional costs may be in- curred to upgrack or replace these products in FY 1998 and FY 1999. This will affect the cktermination of total mainframe costs associated with compliance. 

1 Numbers may not add due to rounding. 

Mr. EVERETT. Do you have additional questions, Lane? 

At this time I'd like to recognize Dr. Snyder, also a very knowledgeable member of our subcommittee, who has joined us, for any 

questions he may have. 

Dr. SNYDER. Thank you, Mr. Chairman. I'm sorry I'm late. One 

of the advantages of being late is you can ask any off-the-wall question you want, and everybody will say this poor fellow, he just 

didn't attend the hearing. 

Would you help me, please, with this problem, which I know is 

not just a VA problem. It's a problem throughout the world with 

computer services. Have you all had any discussions amongst yourself looking back to the folks you contracted with five and ten and 

15 and 20 years ago for your data processing, why we were set up 

for these kinds of problems? 

I mean, it seems like the time to have corrected this was at the 

beginning of computerizing records, not 2 or 3 years before the turn 

of the century. Has there been any-You know, what's the results 
25 

of some of your Monday morning, 20/20 hindsight? Have you been 

angry with any of your vendors, saying why didn't you all-you set 

us up for a problem here by not seeing this coming? 

Mr. CATLETr. Well, very generally now, I think Chairman Horn 

spoke earlier about it, that it was a matter of efficiency when these 

systems were set up to use two digits instead of four. I'm sure 

there was other streamlining that happened. 

It's been noted here that this is now an issue for the next 2 or 

3 years; clearly, we have with the interest of the committee and 

others, intensified our efforts; but this issue has been addressed 

and identified in the VA for a decade. 

VBA began some work and made some changes long ago. Our office automation center did the same as well. So it's been underway 

for sometime. So again, it's-Like you say, it seems so trivial to 

many people. Yet it's going to cost a lot of money, and it's a worldwide problem to address. Dr. SNYDER. I understand that. It just seems like this is a problem that, when we purchase computer services, that we know the 

VA is an institution that's going to be around in the year 3000, 

that some of our vendors should have said, you know, what we use 

at a hardware store which may not be around in 3 or 5 or 10 years 

may not be acceptable for the Veterans Administration 20 years 

from now. 

Thank you, Mr. Chairman. 

Mr. CATLETr. I would make one other point. Despite the fact that 

we more and more go to the market to buy software, we're not a 

large enough share of the market to dictate that supplies change 

that. 

Now in order for the software to work, it has to be done; but I 

don't think we could have 5 years ago, even if we were more prescient than anyone else, to say, hey, you have to do this for us. 

We're not a big enough portion of the market to demand that type 

of change, I don't think. Dr. SNYDER. I apologize for being late. Thank you, Mr. Chairman. 

Mr. EVERETT. Thank you, Dr. Snyder. 

Mark, we appreciate your appearance here today and that of 

your panel members. I would reemphasize how this chairman 

would view the failure to achieve this. It's very critical. I would add 

to that that it would not only, in my estimation, be the VA's failure 

and something ought to be done about those who fail, but it would 

be also this committee's failure, if we don't exercise proper oversight, if you will, to nudge VA where we feel like they ought to be 

nudged in solving this problem. 

I can't emphasize, as I know you realize, how great this problem 

is to our Nation as well as our VA. 

So I thank you for appearing here today, and if you will, tell 

Hersh I'll look forward to seeing him in another capacity before too 

long. 

Mr. CATLETr. Thank you, Mr. Chairman. Appreciate it. Mr. EVERETr. Thank you. Mr. EVERETr. At this time I would recognize our last panel, Dr. 

Tom Shope. He is the Acting Director of the Division of Electronics 

and Computer Science, the Office of Science and Technology, Cen-
26 

ter for Devices and Radiological Health of the Food and Drug Administration, and that's a lot of electronics. Doctor, welcome here. 

STATEMENT OF THOMAS SHOPE, Ph.D., ACTING DIRECTOR OF 

THE DIVISION OF ELECTRONICS AND COMPUTER SCIENCE, 

OFFICE OF SCIENCE AND TECHNOLOGY, CENTER FOR DE· 

VICES AND RADIOLOGICAL HEALTH, FOOD AND DRUG AD· 

MINISTRATION 

Mr. SHOPE. Good morning, Mr. Chairman, and members of the 

subcommittee. 

Mr. EVERETT. Doctor, we're going to ask you to adhere to our 5-

minute rule. Your complete testimony will be entered into the 

record. 

Mr. SHOPE. Thank you, sir. I believe you have our testimony already. I'll just briefly summarize that. 

My name is Thomas Shope. I'm the Acting Director, as you said, 

of the Division of Electronics and Computer Science, Office of 

Science and Technology, Center for Devices and Radiological 

Health in the Food and Drug Administration. 

I'm pleased to be here to provide information about the Year 

2000 date issue and its impact on medical devices. Let me assure 

you that the FDA does not currently believe there will be any 

major impact on medical device safety from the Year 2000 problem. 

FDA is responsible for protecting the public health by helping to 

ensure that medical devices are safe and effective. Any computer 

software that meets the statutory definition of a medical device is 

subject to applicable FDA medical device regulations. 

An issue that has been identified as warranting review is the impact of the Year 2000 on some medical device computer systems 

and software applications. These products could be impacted by the 

Year 2000 date problem only if they use a date in their algorithms 

or calculations or in record keeping, and if a two-digit year format 

was used in their design. 

Let me explain the types of software that are used in medical devices. First, there is embedded software which is software typically 

contained in a microelectronic circuit or a micro-chip which controls 

device operation. Examples of such devices are pacemakers, infusion pumps, ventilators, and many others. 

It is very unlikely that these products would be directly impacted 

by the Year 2000 problem. These devices do not require knowledge 

of the current date to operate safely and effectively. 

For example, pacemakers do not depend on a current date system in order to function properly to support the patient. These use 

counters or clocks, but not explicit dates. Programmers or external 

controllers for these devices have the potential to be affected, but 

the manufacturers with whom we have discussed these issues see 

no problems which will not be addressed. 

Second, there is non-embedded software. Non-embedded software 

is intended to be operated on a separate computer system, often a 

personal computer or a workstation. Such software devices may be 

used to enhance the operation of another device or devices. 

These products may also use a two-digit year format. Some examples of non-embedded software devices include radiation treatment planning systems, transmission or storage of medical images, 
27 

offline analysis of EKG data-or ECG data, rather, digital analysis 

and graphical representation of electrocardiograph data, and systems used to adjust the rate response of pacemakers, the programming portion of using a pacemaker. 

While there is a chance that the two-digit year format may affect 

the performance of these software devices, we believe that the Year 

2000 risk will be mitigated through aggressively working with the 

manufacturers, as the Center is presently doing. 

The Center is preparing to send a letter to all medical device 

manufacturers to ensure that manufacturers address the Year 

2000 issue and review both the embedded and non-embedded software products. 

In addition, we will ask manufacturers to review any computer 

controlled design, production or quality control processes for their 

potential impact with regard to the 2-year digit format. 

The Center anticipates sending this letter very soon, and we 

would be glad to provide a copy to the subcommittee for the record. The letter will remind manufacturers that, pursuant to manufacturing regulations, they must investigate and correct devices that 

fail to operate according to their specifications because of inaccurate date recording and/or calculations. 

For devices that are already on the market, FDA will request 

that manufactures conduct hazard and safety analyses to determine whether device performance is affected. 

We expect manufacturers to identify products which have a daterelated problem that could affect safety or effectiveness of a device 

and to take the necessary action to remedy the problem. 

Again, let me stress that we do not anticipate any significant 

problems which would affect patient safety with individual medical 

devices. We want to ensure the continued safety and effectiveness 

of these devices by addressing the issue before it arises. 

For future medical device pre-market submissions to the agency, 

FDA will review design processes and features to assure that the 

products have been designed to perform date recording and computations properly. 

Thank you, Mr. Chairman, for the opportunity to tell you about 

the issue of the Year 2000 and medical devices. Let me assure you 

that we at FDA take this issue very seriously, as we do all problems that could affect the public health. 

We have been evaluating the possible impact on devices since 

early last year. We are committed to a scientifically sound regulatory environment that will provide Americans with the best medical care. FDA has looked at this issue and does not see any major 

problem with medical devices. 

It is the manufacturer's responsibility to meet high standards in 

the design, manufacture, and evaluation of their products. They are 

ultimately responsible for these products, but FDA will provide the 

regulatory framework to ensure that the collaborative effort results 

in the best medical device products. 

Thank you, Mr. Chairman. 

[The prepared statement of Mr. Shope appears on p. 78.] 

Mr. EVERETI. Thank you, Dr. Shope. I appreciate your testimony. 

As you know, there is a good amount of uncertainty out there right 

now. 
28 

Mr. SHOPE. Yes, sir. 

Mr. EVERETT. In your testimony, you state on page 3-are you 

confident that there is no safety problem? This is something on 

which you wouldn't want to be wrong. 

Mr. SHOPE. No, sir, we would not want to be wrong. I think theYou can't make a blanket statement that there are going to be no 

problems with computer controlled medical devices, but I think 

there will be problems of the type that are easily overseen, anticipated, and dealt with by the physicians using the devices. 

Probably the most typical kind of problem will be a date/time 

stamp on a record of some sort that will not be properly implemented, if that's not corrected; but we hope that, by bringing this 

attention and working with the manufacturers, those kinds of software upgrades can take place before the impact would occur. 

Mr. EVERETT. In other words, your testimony is that we know of 

no devices that would cause any serious problems to the patients 

at this point? 

Mr. SHOPE. I think that's a fairly accurate statement. We do 

know of certain devices that, if they are not fixed by the year 2000, 

could present problems, and we know that the manufacturers are 

working on those. 

An example is a radiation treatment planning system that uses 

a radioactive isotope as the source of the radiation for the treatment. If a computer algorithm used in that kind of a device used 

a two-digit date, the strength of the radioactive source might be inappropriately entered in the prescription for the radiation. 

We know that there are those kinds of problems and that the 

manufacturers are working on them to fix the problem. That's a 

software upgrade, and we expect that will occur long before the 

year 2000 comes around. So that's an example of a non-embedded 

kind of problem with a-basically, with a computer program that 

just needs the software to be updated. 

Mr. EVERETT. Would you furnish this committee with a list of all 

devices, biomedical devices and otherwise, that you feel like could 

present a problem if they are not fixed? 

I would further ask you to follow up and, as each of these devices-as you are sure that each of these devices' problems have 

been solved for these devices, that you would let this committee 

know. 

Mr. SHOPE. Certainly, the FDA would be pleased to work with 

the committee and provide whatever information we can. I'm not 

sure that we're going to have a report from every device manufacturer as they correct the problems. 

The current regulations and the legislation do not require those 

kinds of reports to be presented to FDA under our current regulations. We would learn if there was a problem which presents a significant risk to health and safety, and we would be working then 

with the manufacturer as they correct those; but if a manufacturer 

has no problem, we won't necessarily know that he has no problem. 

Mr. EVERETT. And you've contacted all these manufacturers that 

you know of? 

Mr. SHOPE. Our letter will be going out to all 13,000 medical device manufacturers registered with FDA in the near future, yes. 
29 

Mr. EVERETT. In June 1997 "my question to you would be why the 

letters have not gone out earlier? 

Mr. SHOPE. We began to look at this problem last year, as I mentioned. We became aware of the need to let the device manufacturers know that they need to look at this. 

I think-and the way medical devices are developed and the software that's developed is a very structured engineering process that 

goes on, which is a hazard analysis to look at all the potential 

modes of failure and make sure that you've addressed issues to 

deal with those, and I think, a large majority of devices, that has 

been the case. The year 2000 date is not going to be a problem. 

That doesn't answer the question of why we didn't do it last year. 

We've been doing, I guess, lots of other things, and this didn't come 

to the attention of us at an earlier time. 

Mr. EVERETT. I would hope it is to your attention now, and I 

would urge FDA to move on this as quickly as possible, and also 

to inform this committee when those letters have all gone out. 

In addition to that, I would like for you to keep this committee 

updated on what the responses are and what your evaluation of 

those responses might be. 

At this time, I'd like to turn to my colleague, Dr. Snyder, for any 

questions he may have. 

Dr. SNYDER. Thank you, Mr. Chairman. On page 5 you gave a 

list of the non-embedded software devices. Could we run through 

a few of those, and you give me some scenarios of potential problems that-why you put them on your potential list. Give me a specific example of a doctor and a patient and what could be happening in a hospital or clinic, at a VA facility that might cause-or any 

medical facility that might cause problems. Mr. SHOPE. The issue of pacemaker telemetry data, for instance-The problem that we could foresee there is likely with a 

personal computer type control of the evaluation of the data from 

the pacemaker that's received by telemetry. There it would be a 

date/time stamp kind of thing, you know. The date at which this 

is being done could be incorrect if the PC program is not recording 

dates appropriately. 

As you know, many personal computer type programs will have 

problems with the dates, if you don't take the right adjustment to 

deal with that. 

Dr. SNYDER. Okay. So let's give us an example. So we're getting 

to-It's New Year's Eve, and I've tied one on, and January 1st 00 

comes along, and I go into super-ventricular rhythm or something. 

So tell me how then that's going to impact-How do you see that 

would be a problem? 

Mr. SHOPE. That's not going to be a problem. The problem would 

be perhaps 3 weeks later when you come for your routine monitoring with the physician, and he records the data. His computer 

records might not have the right date associated with it. 

Dr. SNYDER. If the computer hadn't been upgraded. So--

Mr. SHOPE. It's not a direct impact on patient care. It's more a 

record keeping issue. 

Dr. SNYDER. So they try to read it, and you're saying that when 

he pulls off the information, because it's an 00 that it may not pull 
30 

off that particular time. It might consider it the year 1900 or something and too old to be pulled up? 

Mr. SHOPE. It's not-We don't know the details of how that 

might work, but my assumption would be perhaps in the record it 

just records two digits, and you would see that this happened in 

00, and you would have to realize that wasn't 1900. We didn't have 

computerized devices at that time. So it is 2000, but the details of 

those kinds of interactions--

Dr. SNYDER. But that's not a big problem that you just described 

there. 

Mr. SHOPE. Yes. 

Dr. SNYDER. It would be a big problem if it didn't pick it up, for 

some reason. Is that-How about offline analysis of EEG data? 

Mr. SHOPE. Well, I think offline analysis-It's again the type ofDr. SNYDER. Did you mean to say EEG? 

Mr. SHOPE. No, that should have been ECG in the testimony. I 

think I said ECG in my oral remarks. There it would be the issue 

of a computer algorithm that is used to evaluate-to review the 

trace and provide some information to the physician. 

Very often these algorithms need to know the patient's age to do 

that. So you might enter the birth date, and the computer would 

subtract the birth date from today's date and come up with an age 

in years or days or whatever that's used in the algorithm. So there 

could be an error in that calculation which would result in perhaps 

a misinformation to the computer algorithm that is doing the 

evaluation. 

That's overseen by the physician, typically. We don't rely on just 

these programs. So we think that's not an immediate threat to patient safety. It could lead to confusion in the patient's records. 

Those things do need to get fixed. It's a small computer programming type correction that will need to be made. 

It's not clear, I must say, that any of these auxiliary type programs have the problem. The manufacturer is the one who knows 

how he designed the algorithm. We at FDA don't have that detailed 

data. That's why we are saying to the manufacturers, you need to 

review your products, work with your customers to make any corrections that may be necessary. 

Dr. SNYDER. So let me see if I got that example right. So in that 

situation, we're doing an EKG in February '00, and it's going to be 

a computer read thing that a lot of, say, rural hospitals would use 

and will enter in there an age and a birth date. 

Now if the program interprets it based on the age, 95 years old 

or something, we'll be okay or 3 months old, but if it reads it off 

the date '00 and calculates it incorrectly, then your norms for a pediatric patient aged 6 months is going to be different from an adult 

patient in some things. That's the kind of thing you're talking 

about? 

Mr. SHOPE. Right, and so the determination that the computer 

might give in the way of advice about the trace could be in error, 

because it assumed the wrong age for the patient. 

Dr. SNYDER. So as more and more hospitals, I think, are moving-or clinics moving to do some telephone interpretation of 

things, you're going to have to know what's at the other end to be 

sure you're getting-or both ends are going to have to know. 
31 

Mr. SHOPE. But, ultimately, I think, even if it's a telephone interchange of information, the physician ultimately is going to look at 

the trace. You don't rely on the computer program solely. You can 

use that for confirmation, for supporting information, but I see it's 

not a direct impact unless somehow the doctor is not in the loop 

at all, and I'm not aware that--

Dr. SNYDER. Well, a lot of us use it like red flags. If you get a 

red flag back that says, oh, this is an abnormal 6-monther, and it's 

really because it was interpreted as being a 95-year-old, that's 

something. 

In terms of-You gave the example up above on the radiation. 

I'm one of those in my naivete that think the real problem begins 

at the turn of the clock January 1. In some of these kind of things, 

I could foresee potentially that the problem could actually present 

itself before we get to the year 2000 if you're looking ahead. Okay? 

It's, you know, 1999, February, and we're going to be calculating 

your dose and over the next year to get the '00, that somehow it 

could ensnare problems prior to the year 2000. Am I off base on 

that? As a computer programmer would look ahead over the next, 

okay, 18 month course of therapy, and then we enter an '00 for 

treatment number 17--

Mr. SHOPE. Yeah. I'm really not expert in the therapy delivery, but I'm not aware that there are very many regimes that spread 

it out over that length of time. It's typically a few weeks or a few 

months. 

The issue is going to be--

Dr. SNYDER. I see what you're saying. Mr. SHOPE. The issue is going to be in any of those situations 

how the algorithm has done the two-digit date, and if it's simply 

it works okay with 1999, but doesn't work okay with double zero, 

that's not going to be a problem until they plan a treatment after 

the year 2000. It's the planning and not the delivery that's the 

issue here. 

Dr. SNYDER. Mr. Chairman, may I ask one fmal question? 

Mr. EVERE'IT. Certainly. 

Dr. SNYDER. Just a quick question unrelated to your role here, 

but in terms of the manufacturers and your relationships with 

them, do we not also have at play in this whether-I'm a family 

practice doctor-whether we like it or not, the whole medical malpractice, the liability considerations? 

I mean, these manufacturers, if you don't do anything, I mean 

they have a responsibility. If they get no notice from you, I mean, 

they need to be looking ahead at these kind of problems and have 

an absolute responsibility to get this clarified and cleaned up, so 

that family doctors like me can rely on this stuff. Is that a fair 

statement? 

Mr. SHOPE. Yes. I think manufacturers, in order to have satisfied 

customers who expect the products they've bought to meet the specifications and the function-Nobody that I'm aware of contracted to 

buy devices that wouldn't work after January 1. So I think there's 

a very large incentive for manufacturers to satisfy their customers' 

needs here. 
32 

Dr. SNYDER. I mean, hopefully, when you send out your 13,000 

letters, you're going to get 13,000 responses that say we've been 

looking at this for 5 years, and it's all taken care of. 

Thank you, Mr. Chairman. Mr. EVERETT. Thank you. Dr. Shope, I must tell you, I'm extremely disappointed in the FDA, the fact that they have not sent 

these letters out yet. This chairman had hearings on this almost 

2% years ago, and in my opinion, it was at that time too late to 

start some of the actions that we need to start such as the biomedical. 

Very frankly, I can't imagine that FDA would sit over there that 

long and still not have had these letters out. As I said, this chairman had hearings in Pensions and Compensation Subcommittee almost 2% years ago on this problem, and the problem was known 

prior to that. 

I would hope, as I said, that these letters go out immediately. I 

would also point out that I have had very candid conversations 

with our friends over at VBA. This is a problem of the most serious 

nature, not only to the veterans but to the Nation as a whole. 

I don't enjoy putting pressure on people, but as I said earlier, I 

view this as a joint failure, if this is not achieved. Now I do know 

that the folks over at VBA depend on information coming in from 

you, and the process of giving that information to them hasn't even 

started yet, the result of those letters. 

So I would again hope that VHA is given the information that 

they need as quickly as possible. I do thank you for your testimony 

here. We will have additional questions that we will put to you for 

the record. 

Mr. SHOPE. Yes, sir. I'm sure we would be glad to provide those 

answers. 

Mr. EVERETT. Thank you very much. 

In closing, let me say that, based on today's testimony, I must 

say that I am extremely concerned about the prospect of major 

Year 2000 computer system failures, but I'm also happy to hear 

that the Veterans Benefits Administration has heeded the GAO's 

recommendations and has taken quick action to address the areas 

that they have identified. 

The subcommittee will continue to closely follow VA's efforts to 

ensure that their computer systems will be able to provide uninterrupted benefits and safe and quality health care to our Nation's 

veterans. 

The subcommittee will hold follow-up hearings to review the VA's 

progress, as I said. Finally, I expect the VA to immediately inform 

the subcommittee of any missed milestones in their compliance 

program. 

This hearing is closed. Thank you all for attending. 

[Whereupon, at 11:10 a.m., the subcommittee was adjourned.] 
APPENDIX 

STATEMENT OF HON. JAMES E. CLYBURN 

RANKING DEMOCRATIC MEMBER 

HOUSE VETERANS AFFAIRS 

SUBCOMMITTEE ON OVERSIGHT & INVESTIGATIONS 

HEARING ON VA YEAR 2000 COMPLIANCE 

JUNE 26.1997 

I AM PLEASED TO HAVE JOINED WITH CHAIRMAN EVERETT IN 

CALLING FOR THIS EXTREMELY CRITICAL HEARING ON THE VA'S 

EFFORTS TO ACHIEVE YEAR 2000 COMPLIANCE. 

THE GAO TELLS US THE VA HAS A LONG WAY TO GO TO SOLVE THIS 

PROBLEM, BUT NOT MUCH TIME TO GET THERE. I AM ENCOURAGED 

THAT THIS SUBCOMMITTEE HAS DECIDED TO PLACE A WATCHFUL EYE 

ON THE VA'S PROGRESS IN THIS REGARD. I AM HOPEFUL THAT 

THROUGH CONTINUED OVERSIGHT BY THIS SUBCOMMITTEE, WE CAN 

HELP TO ENSURE THAT THE VA IS ABLE TO REACH YEAR 2000 

COMPLIANCE. 

THE PURPOSE OF THIS HEARING IS TO HEAR A STATUS REPORT 

FROM THE VA ON THEIR PROGRESS ON THIS CRITICAL ISSUE,TO 

UNDERSCORE OUR SUBCOMMITTEE'S INTEREST AND CONCERN, AND TO 

MAKE CLEAR THIS COMMITTEE'S EXPECTATION THAT DESERVING 

(33) 
34 

VETERANS WILL RECEIVE UNINTERRUPTED BENEFITS AND SERVICES IN 

THE YEAR 2000 AND BEYOND. 

I BELIEVE IT IS IMPORTANT TO RECOGNIZE THAT THIS IS NOT A 

PROBLEM THAT IS UNIQUE TO THE VA. AS THE RECENT COVER STORY IN 

NEWSWEEK MAGAZINE POINTS OUT, THIS IS AN ISSUE THAT EFFECTS 

EVERYTHING FROM THE PERSONAL COMPUTERS MANY OF US HAVE IN 

OUR HOMES, TO PRIVATE BUSINESS AND INDUSTRY AND TO NEARLY 

EVERY LOCAL, STATE AND FEDERAL GOVERNMENT ACROSS THE GLOBE. 

MR. CHAIRMAN, I WOULD ASK UNANIMOUS CONSENT THAT THE 

JUNE 2, 1997 NEWSWEEK COVER STORY TITLED "THE DAY THE WORLD 

SHUTS DOWN" BE INCLUDED IN TODAY'S HEARING RECORD. 

IT IS ALSO IMPORTANT TO RECOGNIZE THAT THE VA HAS BEEN 

WORKING HARD OVER THE PAST SEVERAL MONTHS TO GET THEIR ACT 

TOGETHER ON THIS ISSUE. I WANT TO COMMEND THESE RECENT 

EFFORTS AND WANT TO MAKE IT CLEAR THAT I DO ~ DOUBT THE 

SINCERITY OF THE VA'S INTEREST IN ADDRESSING AND ULTIMATELY 

SOLVING THIS VEXING PROBLEM. 
35 

I MUST SAY, HOWEVER, THAT THE OBJECTIVE VIEWS OF 

KNOWLEDGEABLE OUTSIDERS STRONGLY SUGGEST THAT THE VA'S 

TASK IS MORE DAUNTING AND DIFFICULT THAN ITS' WRITIEN TESTIMONY 

TO THIS SUBCOMMITIEE MIGHT SEEM TO SUGGEST. 

I WOULD ALSO LIKE TO NOTE FOR THE RECORD THIS MORNING 

THAT THE GARTNER GROUP, A LEADING INDEPENDENT INDUSTRY 

GROUP, HAS CONDUCTED EXTENSIVE RESEARCH INTO THE YEAR 2000 

PROBLEM, AND HAS MONITORED THE STEPS PRIVATE INDUSTRY AND 

GOVERNMENT HAVE TAKEN TO ADDRESS THE PROBLEM. 

UNFORTUNATELY, SCHEDULING DIFFICULTIES PREVENTED THE 

GARTNER GROUP FROM PROVIDING LIVE TESTIMONY BEFORE OUR 

SUBCOMMITTEE TODAY. THE GARTNER GROUP HAS GRACIOUSLY 

VOLUNTEERED, HOWEVER, TO PROVIDE WRITIEN RESPONSES TO ANY 

QUESTIONS ANY OF THE MEMBERS OF THIS SUBCOMMITIEE MAY HAVE. 

MR. CHAIRMAN, I ASK UNANIMOUS CONSENT THAT SUBCOMMITIEE 

MEMBERS BE ALLOWED FIVE (5) BUSINESS DAYS TO PROVIDE THE 

3 
36 

COMMITTEE WITH WRITTEN QUESTIONS TO THE GARTNER GROUP AND 

THAT THE RESPONSES BE INCLUDED IN THE FORMAL HEARING RECORD. 

MR. CHAIRMAN, AS I STATED AT THE OUTSET OF MY REMARKS, THE 

GAO TELLS US THE VA HAS A LONG WAY TO GO TO ACHIEVE YEAR 2000 

COMPLIANCE, AND THE CLOCK TELLS US THEY DON'T HAVE MUCH TIME 

TO GET THERE. THROUGH CONTINUED CLOSE SCRUTINY AND 

OVERSIGHT BY THIS SUBCOMMITTEE, I AM HOPEFUL THAT WE WILL 

REMAIN COMMITTED TO DOING WHAT WE CAN TO HELP ENSURE THE VA 

MAKES IT. 

THANK YOU TERRY FOR YOUR LEADERSHIP ON THIS ISSUE AND I 

LOOK FORWARD TO THE TESTIMONY. 

4 
37 
38 
your government check may DOt arrive, 

your insurance policies may have expired. Or you may be out ofa job. When you show up for work after the holiday. the factory or 

r!:~=~:~ to~~ ::rtho: BUSINESS DUETO COMPlIT'Ea DUloa. 

Could it really bappen? Could the most 

anticipated New Year's Eve party ill OW' 

lifetimes really usher iD a digital BiCbtmare 

when our wired-up-the-wazoo dviliution 

grinds to a balt? lncredibly, a.xordioa to 

computer experts. corporate iDformatioo 

officers. conp-essiooalleaden aDd buically anyOlle who', given the matter a 6Wbearin&, the answer is yea, yet, 2.000 times 

ye.! Yes-unless we succelsfully complote 

the most ambitious and costly techoolocY project in history, Doe where the payoff 

comes not in amassing riches or extending 

Web access, but securing raw survival. 

What', the problem? It's called. variously. lb.e Year 2000 Problem., Y2K 01' the Millennium Bug. It represents the ultimate 

dignity: the world laid low by two lou.sy 

digits. The trouble is rooted in a seemingly 

trivi.aJ space-saving programmiDg triekdropping lbe first two DWIlben of the <&.tel, abbreviating. Ny. the yev 1951 to '"Sl.-this 

digilaJ relic from the days when every byte 

of computer storage was preciOUJ wu supposed to have beeo long gooe by DOW, but 

e~:::nth:=~~~= 

54 "'I[W I[ ~A IU Ne: t . ' 991 

39 

out that thc world', computen wcre DD.. eolWioD eou.rse with the millamium. DO ODe 

wanted to be the one to brina it up to malt" 

.gemeDl. And. really. which ueeu.tive 

would welcome a me.sage &om oerddom 

t1w. few miIlico bud<s would be ,....u.d to 6x $OEM obscure problem that woulda.'t 

' howupforsevcralyean? 

So owy DOW. as the centurial OOUDldown 

betPm, on .. eleamiog tIw tbe digit-droppin& trick bas cbaDced from clever 10 cata-

.trophic. Bec:aute virtually all the maineu- =U:=~d~~th~= 10 rea>jp>ize tIw _ Ul99 """' ...... 

the year 2000 follows. WheD that date arrives. the computers ace coiDa to gct very 

confused. (PCs aren't as affected; sidebar.) So that seemiDaly 

inoocuoua triclc DOW affecta evel)'thing from ATM. to 

weapons systems. Virtua.U: every government. state and, 

muoidpality. u well as every ~ 

!up, midsw. ood .man bwiDCllS in lbe world, is going to 

have to deal with this-i.o fact, 

if they havCD't . tarted already 

it's jwt about too late. Fixina the problem requires painstaking work. The bill fa, aU this? 

Cartner Croup estimates it 

<auld go as blgb .. S600 billion. 

That amount could easily fund. 

yeu'. wonh of aD U.S. educatiooaI row, "",school thnxogb 

gBd school. It's Bill Gales 

timea SO! 

That lab doe.n't include the 

litigation that .. ;n inevitably 

follow the system .fa.i1ure •. "You 

can make some very reasonable 

emopoIations aboul UtiptioD 

that lake you over II trillion. and those an very coDJerVUive estimates. .. 

say. DeaD Morchou.s. • San Francisco 

lawyer. (CoDMrvative 01' DOt. this is more 

Ihaa Ihnoe -. tbe yearly"'" ol.ll civil 

~iDthe U"ledS ...... ) Co .... on. you say. Tao IMdIly dilWP 

Ca,,', ... jUII unlauh 101M IOn of robo- "_ ".". .... .JI''''''_ ... ...uwclar . it.,.r Well. DO. F ..... about. oilvor bulIo. II_thatiD_maiDframe_ 

tbe dale _ ...... ofteD Ihaa 

"M-A -S-H- re:nma 0lIl t.eIeviaioD-ibouI ..... bani "..., 150 U- ol coda. 1)pbIly, 1<'. 10 IiDd _ partkuIar _, because 

the oripaI -. _ written ill tbo 

__ COBOL COIIIpJIer ~ .... 

quirl<y aud .................... Aft.. aU that 

maIyW, ,.... ..... to ficure out bow to ....me tbe _ to c:errec:tIy p_ tbe dale. o.Iy ............ tbe _ time-aD-

........... -.. tbe rowrittea 

--.y 

It',. torturous 01>0. _ proeeu. if but 

.... Ul~ doa'I._ the IIIlIIooDium Due. .... '11 have _ 

evuywbon. 

-...,. WbaD tbe 1Ia_ Electric 

utility ill Hooolulu rail teItI OD ib .yltem to 

... if k ....,]d be olfected by the Y2K B .... "buQ/ly, it jus< stopped woriaac. ... ,. .,.._~W...dolIllO Iftbeprobiom bad .... ~ _ oaly ....,]d 

..... cuIIomen ha"" poteDtially lost pow-

....,]d ~~:r=.J..~ .. _ , aud ..... thiDpcouldbiow 

up.. apIaiDs 110. (1Ia_ Electric: ..-

wmped tbe softwan ood ..... claims 10 be ...ty""tbeyoar2000J~_ 1- - , 

oudoar power. tbe N...Ieor I\eaUlaIO ' Commiuioo"Y' tIw tbe Bua migbI aIfec:. 
40 

The Birth of a Computer Catastrophe By LARRY GONICK 

[f programmers are so smart, bow could they do something so stupid? A cartoonist's explanation of history's bi&geS[ software ~boo. 

JUNE 2 , 1991 NEWSWEEK 55 
"security control. radiation 

monitoring ... and accumulated 

burn-up programs [which involve calculations to estimate 

the hazard posed by rawoactivefuel]." 

Communications. "If DO one. 

dealt with the year 2000 ug. ' 

the (phone) oetwork would Dot 

operate properly," says Eric 

Sumner Jr., a Lucent chief technology officer. He's not ~ 

about dial tones, but things like 

billing (watch out for l00-year 

c.ha.rges). Certain commercial 

operations that run phone systems by computer could also go 

silent if the software isn't fi. ~ed . 

Medicine.. Besides the expected mess in billing systems. in-' 

surance claims and patient records, hospitals and doctors have 

to worry about embedded 

chips-microprocessors iDsi1:tc! 

all 50rU of devices that sometimes have dat~ensitive controls. The year 2000 won't make 

pacemakers stop dead, but it 

could affect the data readouts it 

reports to physicians. __ NEWSWEEK has 

obtained aD internal Pentagon 

srudy listinc the Y2K impscl on 

weapons and battlefield technologiea. In their current state, ". year 2000 

problem emu" in several key military technologiea and they will ~e upgrading or 

adjustmenll. One intelligence system reverts to the year 1900, another reboo .. to 

1969. The report cooJidendy states that u 

tar u nuclear devices like Trident missiles 

are cooceroed. "'there are DO major obsta~ 

cleo which will provent them from being totally Year 2000 compliant by JI11.1999." 

1Ianor- IIaDb and other fiDancial institutions generally will go hooken if they don't 

fix the year 2000 problem. The Senate Bank-

"" Committoo it even worried that vertigi- nous computen might automatirally ...... 

41 

the lut 99 yous' worth of bank record •. 

Some Y2K consultants are advising CXlDsumen to make sure they dem't enter the 

1999 holiday without obtaining hard-.:opy evidence of their .... t •. According to Jock Webb of HONOR Teclmologies, 110:., ATM. woo't work without fixes. -'In Britaincomputenal the MarIrs& Spencer company have already mistakenly 

ordered the desbuction of tODS of comed 

bee/; believing they were more than 100 

yean old. 

Alr-Tralllc CoatroL -We're still in the .. -

-....eDt stage, dete_g bow big the 

problem i.," says DeIlDit DeGaetano of the 

Federal Aviatioo Administration. One possible danger ia 

computer lockup: while planes 

willkeepmoviDgat12:01a.m.oD 

Jan. 1. 2000. the screens monitoring them, if not upgraded. 

might lock. Or the compute" 

might know wbere the planes 

were, but mix them up with 

flights recorded at the same time on a previous day. ("You 

can bet we're going to fix it." 

says DeGaetano.) 

Fleta ...... Ford Motor Co. report. that if the Bug isn't 6xed, i .. buildings could literally shut 

down-the factories have security systems linked to the year. 

"Obviously, if you doo't fix it. your busine--, will stop in the year 2000: says For 

David Principolo. EvOD if a manufaeturiI." 

company _ssively solves i .. own problem, though. it might be flummoxed by • 

supplier who deliven widge .. in the wro", 

centwy. Joost _ EvorrtIt/tIt 11M. Larry Martin, 

CEO of Data Dimensinns, warns that if not 

adjusted, ·onJan.l, 2000, a lot ofelevaton 

could be dropping to the bottom of buildings," beading to the basement fur inspections they believe are overdue. Similarly, 

automobiles have as many .. 100 chips; if 

they are calendaN:ba1le",ed, experu say, 

furget about driving. Computerized spril>-

lder systems could initiate icy midwinter 

drencbin&s. 

Like leaves rustling before a tomado, 

there have already been harbingers of. bureaucratic meltdown. At a slate prisoo. a 

computer glitch misread the release date of 

prisonen and freed them prematurely. In 

Kansas, a l04·year-old woman was given a 

notice 10 enter kindergarten. Visa bu had to recall some credit cards with expilation 

dates three years hence - the machines 

reading them thought they had expired in 

the McKinley administration. 

The $600 billion question i.t whether 

we'll fix the Bug in time. The good news i. 

that the computer industry it finally 

spondiDa to the chaDeoae. For mOIlL 

""'4U.lOl n OI. D_ CAMIoiIA·LlAIIOII (TO'., ",.OIU ... ..... " U ... Of O - l'O .. ' Sl'OIO,.",,,c:a 
DOW. squadrons of digital J.remiahs ba •• been addressiDg tech conferences with 

tales of impending apocalypse. 1M most 

sought-after is Peter de JagC!'. a bearded 

Caoadian who scares the pants off audi· 

ences on a Dear-daily basis. "If we shout 

&om the rooftops. they accuse us of bype .... 

he complains. "But if we whisper in an alley, Doone willlistcn."wt week in Boston 

de Jager demonstrated the rooftop approach: "If you're not cha..niingcode by No- vember of this yeax," be warned. "you ' will 

DOt get this thing done 00 time-it', Ihat 

simple. WestiEl don'ttet it'" 

But we're starting to. Most major corporations now have year 2000 task forces. 

with full-time workers funded by multimil1ioo-<lol1ar bwlge". 10 fill a problem tbat their bosses 6nally understand. they're 

aided by an army of consultants and .pe-

=ns~r£till·y~ms:~~, ~=~ tools. programmers and guidance. Othen. like Peritus. sell special software to help 

find offendio, code and, sometimes. even 

convert it. Ol'te final. most arduous ,tap. 

testing. still defies automation.) Th ... 

6I'DlS an: the new darlings oi Wall Street. 

But buyer beware-consultants ate comiDg 

out of the woodwork to ezplolt the despera· 

tiOD of late-coming companies. SomeoDe 

mighl promi.. • phaJanz of brilliant pmgrammers to fix the 8u&. but '"foe all you 

know. it could be 10 people in a pnge d0-

ing it by hand." says Ted Swoyer. a PeriN. 

exec. Still. the creatioD of a Y2K-fixioa infrasb'Ucture is encouragma. II's Dot UDCODUllOn to fiodgung-boeffortt like the one al Merrill Lynch: an 8O-penoo 

42 

The Sky Is Falling, the Sky Is Falling! Ooe of the most perpluing aspects oCtile miUeDDium bug is the fact that DO one really 

know. what will happen. Best ..... " DO apocalypae. but lou of trouble. 

IlIIaI) to "--'!'ra.ele" gel very Iiuailiar with the akport 

lounge. Airline,' Jleets stay 

aloft. bUI delay. aboUDd. The 

bottom line: stay bome and 

watch bowl games. 

Worst ... norJo: Security .ystems leave worUn 10clced 

outside the front gate. Assembly lines stop movin&- 1hose 

1999 models remain oa sbowroom noon. 

UkoIy to ha-. The big c0mpanies get their act together, 

but suppliers bave problems 

that slow shipmeots; 1999 mod- els stay OD sbowroom noon. 

lIIIIIJ toltajlpon: Some potroDs 

may be temporarily shut out of 

their accounts. Flectronic wire 

InDsfers ""'y be disruptod.lt may be best 10 keep a few dol- Ian UDder the_ 

records ==meI~- get fouIed up. SuppI>- en Ioae records;_e 

cIopresaon become ....... 

W ~~~m."~U~~to~~~~~;'=~- __ ~ 1 ..... .wr .. ....JJ . 

AoooupI Coatroi chip ope.. Minor moICunctIons '""'" 

the wrona releue valve. Badia- shorHerm shutdowDa. Stock: lio. problema moIco Three Mile up o. candJea mel8uhIigbt 

Island looldib a picuk. batteriea. 

W __ Fedoloaetnck 

of goven>meDl-bono6ts redpi-. 

... ... TheIRS~,.... ... bill ia equal 10 the oatioaoI debt. Doadly_ bpt UDder computer lock are_ 

Y2K divlsioo wurIdaa In -.. Z4 baun a 

clay.aeveo!C! ....k.1t·Ucootthecompa- oy UOO a sum that could hire MicbaeI _ mel &n Mike 0Yitz. "Our 

retunI OIl iDY8ItmeDl it zero,· .. ,. MDior 

VP Howard Sorpn. -nu. will J .... enohIo us to .tayinbuaiDeu.· 

So _ybe wo· ... not In fOr a NII-aca1e dia- utero Lot us uaume-oll God 1M it .. ,,...-tbat_ in ....... oflifHuotaJnlDc 

appli<&tions ODd oervic:ea will keep their 

major .,.Uemsan iDtact. Some 

benefits c:batb .... Iate. T edt- _p Gore takea a bit. 

DANT& C.I""I 

'<,.lO..,TTON '"U".'D~ .. _ rf(;, T"'C"AU'_lIt ... etU:C;'SAUG'_ITOC • 1U"" s, 1997 NEWSWE.a. 57 .. ~u" au ~D" .O. tO~' HO ... '''A'':[I. ,PC. "OCUO'T. ao ... ,TI',","_O, .. 
SPI(I\I HI I'D!! I 

largest commercial bank in tho United Stat ... Early in 1995, the company realized that "it wu a problem that could brinaan institution to its mees." says David lacino. 

who bead. the bank's Team 2000. To stop a 

meltdown, BankBo,toD bas to probe 80 million Une, of code. The harder BankBoston 

works at solving tho problem - it now bas olO 

people working full time on it-tho more complicated. it seems. "Every day. when we 

see smnething new we haven't thought 

about, we get additional angst," say.lacino. 

Of the 200 BankBoSlon applications that 

need ~pinc. ooly a handful bave been completed so Car. BankBostOD is DOW sepa- rating the essential work from the noncritical, and if the Bug causes less dire pro~ 

lems. like the heavy vault doors swinging 

open on New Year's Eve, it'll just cope: 

"'Vaults are physical things," says lacina. 

"If push cpmes to sbove, we can put a 

guard in froDt.· 

Now. if Bank.Boston. which started eaI'"' 

Iy and bas been driving hard, i, already 

thinkiug triage. wbat is going to happeD to 

institutions that ue still negotiating .in the 

face of a nonnegotiable deadline? The Gartner Group is estimating that half of all 

businesses are going to (all short. 'ibere', 

still a large number of folks out there who 

haven't star1ed," says Matt Hotle. Cartner's research director. 

51 NEWSWEEK JUNE 2. 1997 

43 

Ao bulineo .. ,liDalIy <OllIe to tenu with 

tho inevitable. it', aoin& to be panic time. In 

about a year, oxpoct most oltha commerdal world to be totally obMosed with tha JIui. 

"Pretty lOOn w. have to just Oat stop doina 

other work." sayo Leo Verbeul of Ca1ifOrnia', Department of Molor Vehicles. 

But DO &IIIOWII ol money or retQUI'1lOI 

will pootpone the year 2000. It will arrive 

on time. even if all too many computeD fail 

to rocognize ito prueoce. 

"It', ,..,.erina to start doina mind 

pmos on what _ntago of -compal)ies 

will., out olbusiMoo.- .. yo GartDer', Ho- tie. "What is the impa<:t to tho _y ofl 

perceDt going out of busiDe .. r Or maybe 

more: Y2K expert Capen Jone, predicts 

that more than 5 pen>mt of all buliDea&eo will., bust. This would throw bundreds of tbousands of people into tho ..... mpIaymoDI lineo-applying fur cbecb that -1 or may Dol come, dependin& OD wbetber the aovemment bat ,~ ooIVec1 ito 

Y2KprobIem. 

What Is the U.S. ,ovommeot doing? Not eooucb-"[(, iroaic that tIWo admlDiolralioa 

that prideo itself on beina 10 high tech Is DOl really facing up to tha poleDtiaI diautIIr that Is dowo the road a little bit. ... yo Sea. Fred 

ThompooalfY2KiDdeed beoomeoaealami· !y, it may well be tho vice pruidODt wbo ouE- fen-imagine AI Gore', spencIina the entire 

eIectioD campmp apIaining why be didn' 

em-the crisis. (Gore declined to ,peak to 

NEWSWUItODtheY2Kprobiem.) 

Here', tho rec:lpe fur a federal breU;-

down: Dol enoup time and not eaough 

moDey. While tho Oflke of MaDagement 

aDd Budget cIaimo tho problem CUI be m..I 

for U .S billion. mo,t experto thinIt it will take ISO billion. Rep. Stepben Hom bold bearinp Iut year to ... if the federal __ 

cieo weno taIdng,tepo "to preventa possible 

computer disaster,· and was l\abbergasted 

at tho Iadt ofpreparedneso. His committee 

usicJ.ed each departmeDt a letter crade. A 

few, DolabIy Social Seeuri!y, were pv.o A' .. 

(Ib SSA bas IIeen working on the problem 

fur eight yean and now bat it 65 pen:ent 

licked; at that rate it will aJrnoot malt. tho 

deadline.) Tho.. with DO plan in pw..-

NASA. the Veterans Administration-sot D',. Special disbonor was given to pIaees 
...,['; t 1 \1 1.1 Illlll 

wbere_couIdbecritical,yetcomp!ar:er>q IIiIl ruled. like tho deponmeou 0(1.&-

bar, EDerayODd TraDsportation. 

Slote ~ ...... also up ogaiDst 

tho 2000 wail CalW>ruia. for inslaDCO, finished ita invea/AJly last December aDd fouad thai mar. thao haJ( of i .. 2,600 computer .,.toms required fixes. Of those, '4S0 

lystem.I are considered -missioD criti~.· 

say. the sIote'. chief iDCormalioD olIlcer Jolm Thomu F1yon. n...e include computen thai COIIIroI toll bridge., traffic . 

ll&bIO. lottery paymeo", prisooer ",leases, 

weI&n c:boc:b, to coIlectioo and the )widIinc oftoDc cbomicaIs, 

44 

TuId'oroo 2000, IIobiD c.-ior, worrioo 

thai oaIy • fndloa rally UDdonIaDd ... bat'. required. "I'm DOt .. yiD& _'", 

cIoom..:I. but if ........ DOt doina bettor in 

&II; 1IIODlhs, , really will be wonied," be 

"Y" H •. expects tho coot ID lop aBO biIIIoa. 0.. tho Cootinoo~ tbiDp .... mucla worse; 

IDOStoftho~-V 

is deyoted to tho Euro-c:umme7, ODd ohseiven far thai ... boo COUDIrieo lib Germany ood Fraoc:e liDaIIy taclde 2000, it 

miabt be too lat •. 

M bod .. it __ in tho UDited Ststea, 

tho Nat of the wodd 10 Jac&ing far behind in 

Ib:in& the problem. Britain bas receotly awaboed ID tho crisis-a .wvey \ale last year sbowed thai 90 perceot ofboard direc- ton !mew of it-but the bead of Britain'. 

MIkboiI 

I\ussia 

Gorbo<beY seems compa-t. met rib .......... 

~ 

tive Hom ill Wuhinatoa. -..me CODcam about bow far bobiDcIlIuuIa 10 iD cIoalinc with tho ~ Goci>ed>eY raisod lis 

_ibIo impad OIl the COOI>II7'o DUClou saf..,......u. Tho list can .., OD, ODd OIl ood 011. "It'. 

lib OD iceberJ," sayo LoaD KoppeImau. m 

Wit' CaaooaY L VltT1CA e1&4 Il!ca TIIOtU.I ill 

W ... i"" .... Da.au. aa.uf.cu .. ..a4 aacNnnN 

'u .. ia C.li/M-lc. JVIa EDaUOff JIAuoaT fA "",~t. JIlHN.,,, T4JfA&A I. H .. r .... aU 

WU.UAM UNDD •• U'. LN" 

Will My Home PC Die? 

Probably not. But taking a few precautions before 

New Year's Eve 1999 could prevent a lot of headaches. 

S

O WHAT [p MULTIbilliOtHloIIsr multiDstioDaIs In! faciDg • die- ita! bairbaII of lID' . . 

preoedented proportions? : 

You want ID know what will happen to yOW' PC at home. 

Cbanceo an:, nothing much. 

The most likely year 2000 

hiccup involves a piece of PC 

arau>s called the Basic Ioput/ 

o..tput Sy.t_ or BIOS. The 

BIOS is simply the software 

that ItartS tho computer 

before an operac:iDg system. 

such II Window> 95, kicb in. It's tho BIOS thai coDIOiIls 

• machine'. iDternoI clocI: 

Informalioo. 

It your PC is Ie .. thao 2 yeors old. it probably CODtains I DOwer BIOS thot will sail throuab midDigbt It ceDtwy' • ...a without incident. 

But if you .... using on old .. 

machine, ODd WiDdows 95 or _ of ita predocesaon. you 

oouId .... alitcb. The fint 

time you tum. your computer 

OD in the new year. you're 

likely '0 see the dock set 

'01980. EveD if your PCs clock enten. time warp,lidac tho problem is relatively ouy. 

Just retet tho date with ...... 

mal W!Ddows oc DOS com- muds, ood you'll be fiDe for 

the om 100 yean (with Willdows 95, cIoubIo-didt OD tho date in tho Iower-ri&ht-baad 

comer of the ICl'HD oc 10 to 

the Cootrol PaoeQ. It's like reo 

settiDJYour bousebold docks Cor deYliaht saYina time. Mi- crolOft°s current version of 

Window. NT fixes the BIOS 

problem automatieo1Iy. So will tho 

out venioa of 

Wmdo .... 95, due out ..... year. 

MiaoooI\ advises apiIlst per- formiDg my t .... 

youneI£ ........ 

settiDa tho computer ID 11:59 

p.m., Dec. SI, 

1999, aDd..-.itill& 

lD_wbatbeppeDL It your mecbiIlo 00Dtains appIIcatioDs with timolimilsoo 

tJ.D, tho soft- ....... mi&bt be i>oIod inlD . 

thiDIdDc It bod upirod. or be damaaeci. It you' .. UDSUre 

wbother JO"i BIOS will trip 

00 tho dale .--,..,. best bet 10 ID eoo_ tho _tor mao ....... or. 386 aod 4Il8 macbiIloa may ~ oeocI 

• BIOS~. Apple C0m- puter UIUI'eI uaen-chat all its MadDIosh oompullln _ 

Dize dat .. up to 2040. 

M Cor,..,. appIi<aIjoas, WhoD in ~ call tho soft-

....... _yood_bow 

year 2000 &tndIy Ita p!Od- lIdS ant. MIcroooft. 6>r_ 

points out that all ollta p!Od- uets _ dates in &Jur.dicjt 

form. The mabn oflDtult'. 

popular por.-I-&aoco po- _ Quid<aD. say it will DOt 

.., bonerk ood..-aa!ially 

pay 100 yean' wocth ofbills 

6>r you come 2000. It you'''' 0'" of the baadfuI of __ 

usiIl& s-y ...... ld DOS ....... siaDa (S.O or below), your po-

&ram ...... 't roll over ID tho year 2000-but it'. time you 

upgnded onywsy. Micn>Ioft 

like 

says 

Moaey 

the same 

prosnm 

for its ~ 

(both 

daims were bome out by 

infonoa! NEWSWUI< too .. ). 

Whether you sbouJd UDp1ua 

your computer ill cue your 

elt>ctric power aqeo beywire 10 

less ouy ID predict. 10 ........ 

alltpoy. to ...... few io- tochprec:auli<msrymoooureo 

apiIlst year 2000 maNs. 

Keep bodcup records (both OIl 

8oppies.nd OIl paper) olbook 

bslaoces, c:redit'card stalemoo .. ODd utility bills. That'. 

..-ba!year2000~~ 

JODOO is doiIla. Ho aIoo pIaos to enter the out millamrlum With. Cull tonk ol au in his 

car (lulDmated 8N pumps miabt spit bock his credit c:ard. be worries) aDd p\eoty 

oftraYOler'. checb in his 

poc\<eL Just in cue. 

JUn. HUHP 

wit. DuoAAH aa"Haculoll 

JUNE I. 1991 NEWSWEEK 59 
45 

STATEMENT BY CONGRESSMAN FRANK MASCARA 

HEARING ON V A 2000 COMPUTER PROBLEM 

JUNE 26, 1997 

THANK YOU MR. CHAIRMAN. I WANT TO 

CONGRATULATE YOU FOR CALLING THIS HEARING 

THIS MORNING TO EXAMINE THIS SERIOUS VA 

COMPUTER PROBLEM. 

LAST EVENING I READ OVER THE MATERIAL 

PROVIDED BY THE COMMITTEE, AND I MUST SAY I 

AM MOST ALARMED THAT IF THIS PROBLEM IS NOT 

CORRECTED, AND CORRECTED QUICKLY, IT COULD 

RESULT IN LATE BENEFIT CHECKS AND DENIED 

BENEFITS TO MILLIONS OF VETERANS ACROSS 

AMERICA, A SITUATION WHICH THIS SUBCOMMITTEE 

SIMPL Y CANNOT TOLERATE! 

I UNDERSTAND THAT SINCE MY COLLEAGUES ON 

THE HOUSE COMMITTEE ON GOVERNMENT REFORM 
46 

AND OVERSIGHT GAVE THE V A A "D" FOR ITS 

EFFORTS TO CORRECT THIS PROBLEM AND THIS 

HEARING WAS SCHEDULED, THE VA HAS BEGUN TO 

MOVE. 

THOSE IN THE KNOW, HOWEVER, SAY THAT THE 

PLAN BEING DEVELOPED BY THE VA IS VERY 

GENERAL AND RAISES MORE QUESTIONS THEN IT 

ANSWERS. 

I AM HOPING THAT TODAY'S TESTIMONY WILL 

HELP ALLEVIATE THE COMMITTEES CONCERNS AND 

NOT GIVE US CAUSE FOR FURTHER HEART BURN. 

THE BOTTOM LINE IS THAT TOO MUCH IS AT 

STAKE HERE TO EVEN THINK OF THE V A NOT 

GETTING THIS PROBLEM CORRECTED. VETERANS ARE 

RELYING ON US TO KEEP THE PRESSURE ON THE V A 

AND YOU ALL CAN REST ASSURED WE WILL DO 
47 

EXACTL Y THAT UNTIL THIS PROBLEM NO LONGER 

EXISTS. 

THANK YOU MR. CHAIRMAN AND I YIELD BACK 

THE BALANCE OF MY TIME. 

--THE END--
48 

REMARKS OF THE HONORABLE LANE EVANS 

RANKING DEMOCRATIC MEMBER 

HOUSE VETERANS AFFAIRS 

SUBCOMMITTEE ON OVERSIGHT 

AND INVESTIGATIONS 

HEARING ON YEAR 2000 COMPLIANCE 

JUNE 26.1997 

I WOULD LIKE. TO COMMEND CHAIRMAN EVEREn AND JIM 

CLYBURN FOR HAVING THE FORESIGHT TO PUT TOGETHER THIS 

CRITICAL HEARING THIS MORNING. I HAVE TO ADMIT MY EYES 

SOMETIMES GLAZE OVER WHEN I TRY TO UNDERSTAND ISSUES 

RELATED TO COMPUTERS BUT I UNDERSTAND ENOUGH TO KNOW 

THAT COMPUTERS ARE AN ESSENTIAL PART OF BUSINESS AND 

GOVERNMENT LIFE IN THE 1990S. 

IF THE VA IS UNABLE TO SUCCESSFULLY MANAGE ITS TIME AND 

RESOURCES TO DEAL WITH THE IMPENDING YEAR 2000 CRISIS, IT WILL 

PLACE THE VETERANS IT EXISTS TO SERVE AT GREAT RISK. 

AS THE GAO HAS POINTED OUT IN ITS TESTIMONY, UNLESS 

MAJOR SYSTEM-WIDE CHANGES ARE MADE AT THE VA, VETERANS 

COULD RECEIVE INACCURATE COMPENSATION AND BENEFIT CHECKS 

-IF THEY ARE LUCKY ENOUGH TO RECEIVE THEM AT ALL. VETERANS 

COULD RECEIVE DEBT-COLLECTION LEnERS EVEN WHEN THEY DON'T 
49 

OWE THE VA A THING. FORECLOSURE PROCEEDINGS COULD BE 

INITIATED BECAUSE OF MISTAKEN DATE CALCULATIONS. 

IN ADDITION, NOBODY SEEMS TO HAVE ANY IDEA WHAT IMPACT 

THERE MIGHT BE WITHIN THE VETERANS HEALTH ADMINISTRATION 

(VHA). WHO KNOWS WHAT COULD HAPPEN IF COMPUTER CHIPIMBEDDED PACEMAKERS OR HEART DEFIBRILLATORS SPIT OUT 

INCORRECT DATA OR RESPOND INAPPROPRIATELY? HOW WILL THIS 

AFFECT FOLLOW-UP TREATMENT BY VA PHYSICIANS? 

OBVIOUSLY THE MANY UNANSWERED QUESTIONS RELATED TO 

THIS YEAR 2000 COMPUTER COMPLIANCE PROBLEM ARE OF CRITICAL 

CONCERN TO THIS COMMITTEE AND TO OUR VETERANS. THE 

URGENCY OF THIS HEARING CANNOT BE OVERSTATED, AND THE NEED 

FOR CONTINUED CONGRESSIONAL OVERSIGHT ON THIS ISSUE 

CANNOT BE UNDEREMPHASIZED. 

AGAIN, I SALUTE TERRY AND JIM FOR CALLING THIS HEARING, 

AND I LOOK FORWARD TO TODAY'S TESTIMONY. THANK YOU. 

2 
50 

Statement by Rep. Luis V. Gutierrez 

Subcommittee on Oversight and Investigations 

committee on Veterans Affairs 

June 26, 1997 

Mr. Chairman, thank you and Ranking Member Clyburn for 

permitting me to join with your Subcommittee this morning and 

submit a formal statement. 

I wanted to participate in this hearing because the ramifications 

of the "Year 2000" problem are very serious for veterans 

throughout America. 

In a study conducted about a year ago by Representative Horn's 

Subcommittee on Government Management, Information and 

Technology the Department of Veterans Affairs received a D for 

their efforts to resolve the "Year 2000" question. 

While I am sure that both the Veterans Benefits Administration 

(VBA) and the Veterans Health Administration (VHA) have made 

progress since this time to develop and implement a 

comprehensive plan to deal with this possible crisis, I remain 

concerned that the benefits and medical devices that thousands 

of veterans depend are in jeopardy. 

Interruption of the delivery of disability compensation payments 

to veterans in need or the malfunction of computer-chip driven 

medical devices that thousands of veterans depend on is an 

absolutely unacceptable scenario that must be avoided at all 

costs. 

Allow me to emphasize costs. 

I strongly believe that all the appropriate resources that are 

required and available to address this matter must be allocated 

and employed as soon as possible. 
51 

If it is a question of money, than Congress and the VA must do 

what is right and what is needed and come up with the capital. 

In our nation's wars, in Normandy or Khe Sanh, veterans did all 

they could to defend our national interests. 

Now, we are obligated to follow that example and do all we can 

to defend their interests. 

Thank you Mr. Chairman, I look forward to hearing from our 

distinguished witnesses today. 
I;IItN_TOOI

~ 

. _ 

1If_.00l.~_ ~ 

JOI!-tHAS,..IIIT "l_ 

COOO&,......ct! .. uo-e~ "",",Yl"'O C_S,~,,_.S C~ "(. ' 

srrvt .... sc-' ... "' .. ·UOCO 

C>MISTOfI'>oI!IIICO. C"",,"OOIf<U 

li---

52 

ONE HUNDRED FIFTH CONG~ESS 

~ongr1'55 of tbl' ~nitl'b ~tat1'5 

_ousr of l\rprrStntatibrs 

COMMITTEE ON GOVERNMENT REFORM AND OVERSIGHT 

2157 RAYBURN H OUSE OFFice BUILDING 

WASHINGTON, DC 20515--6143 

..

_ ........ ·· XlrhI:2S-~ · ... l'OI"~_ ' 

"'" l'Ot ~ 

Ht:_.*1o._ ~.0I'INIA _-.a_"'011{_'" 

~~:::!"=~ 

~~~~?~:: :=:~~=:?~v. ( .......... 1'f ... ., .. "'VlV .... " 

"UHOlOl!" 1't""lVIo""" tlu ... 'e...-..o",uRYLO. ~ 

OI! .... I5Kue .. IC .. ~1O 

AOD'" l'UCIO..II:voc; .. Ill!"'OI1 O'O' .... VkI)ll.VlS 'UIOQS 

~~~~~;..':"'$ACHUSl!ns 

I >oOlAAS " "lt'''_ 

REPRESENTATIVE STEPHEN HORN (R-CA), Chairman, 

Subcommittee on Government Management, Information, and Technology 

Testimony before the Veterans AITairs Committee 

June 26, 1997 

I would like to begin by thanking the Chainnan for holding this hearing today. 

Hearings and other oversight activities are crucial if we are going to keep up the pressure 

on agencies to fix their Year 2000 problems. December 31. 1999 is a deadline that cannot 

be extended. If it is not met, the Federal Government will fail to provide important and 

even essential services to the public. The full ramifications are unknown and threaten to 

be massive. 

As more and more people are learning. most computer systems throughout the 

world run software that employs two digits to signify the year. "97" means 1997. For 

this simple reason. these systems are at risk of failing on Saturday. January I. 2000. The 

two digits of the year 2000 -- "00" -- will not be interpreted to mean 2000. Most 

computers will interpret "00" to mean 1900. Some systems may even misunderstand the 

digits to mean no date at all. 

The result of this "Year 2000 Problem" could be. in eITect. a global computer 

,·irus. with computer systems unable to send or receive accurate infonnation or. in some 

cases. to even function . 

During the last Congress, an investigation of the Subcommittee on Government 

Management. Infonnation, and Technology first brought to light the near-total lack of 

preparation by the Federal Government for the Year 2000 problem. Despite recent efforts 

by Federal departments and agencies. I cannot report that sufficient progress has been 

made toward preparing the Federal Government before the year 2000. 
53 

The Subcommittee on Government Management held an initial hearing on April 

16,1996 to discover what Federal agencies were doing to prevent a possible computer 

disaster. Alarmed by what the Subcommittee learned at that hearing, I joined my 

Ranking Member Carolyn Maloney in sending ajoint congressional oversight letter on 

behalf of the Subcommittee. The overall response the Subcommittee received was 

discouraging. Only nine of the twenty-four agencies responded that they had a plan for 

addressing the problem. The Subcommittee released its conclusions on agency 

preparedness in the form of grades. Four agencies were given As, four agencies were 

given Fs. I regret to report that the Department of Veterans Affairs received aD. 

In September 1996 the Committee on Government Reform and Oversight issued a 

committee report, "Year 2000 Computer Software Conversion: Summary of Oversight 

Findings and Recommendation." The report expressed concern that many Federal 

Government departments and agencies were not moving with necessary dispatch to 

address the year 2000 computer problem. 

On January 14, 1997 the Subcommittee sent to each of the statutory department 

and agency chief information officers a letter requesting updated information on the status 

of year 2000 activities. Since then we have held two hearings on the issue and plan a 

third for the second week in July. 

Most Americans take computers for granted and find it very hard to believe that 

this is a serious problem. Yet computers and the mechanisms they control have become 

an integral part of everyday life -- from the communications we use, to the checks we 

receive. to our medical care, and even the elevators we ride. This has serious implications 

for millions of Americans who depend on government computers for health care veterans 

benefits. unemployment checks, weather forecasts, airline schedules, and financial 

transactions as simple as cashing a check or as complex as managing a trillion-dollar 

currency exchange. The possibility for nationwide disruption is almost endless -- and 

without careful planning and deliberate action, it will be endless. 

There is no easy solution to this problem, no silver bullet. Programmers will need 

to review. line by line, the computer software code in use to determine if date 

computations are afflicted with the Year 2000 problem. As a technical matter, fixing the 

software is not very difficult. The heart of the challenge rests in organizing such a 

sizeable undertaking, and then in the testing and verification of the changes to make sure 

they have been completed correctly. Yet, the certainty of this deadline, just over two 

years away. requires immediate and directed action without further delay. 

What is most troublesome to me and other members of the Subcommittee on 

Government Management, Information. and Technology has been the terrible track record 

the Federal Government has with many of its information technology acquisitions. New 

Federal Government computer systems frequently take longer to install, cost more, and 

deliver less than was planned for at the outset. 

Based on existing plans submitted to the Subcommittee on Government 

Management. 12 out of the 14 departments do not anticipate completing their Year 2000 
54 

work until the final three months of 1999. Should the Federal Government encounter 

even a fraction of the delay or difficulties that most acquisition projects have encountered. 

the Year 2000 computer problem could have calamitous consequences. 

There is another troubling aspect to this problem, that of embedded chips. 

Witnesses have testified before our subcommittee that some devices containing embedded 

microchips may not be designed to recognize the new century. Critical systems that 

depend on automated devices include security systems for badge readers, surveillance and 

home security systems, parking lot gates, and vaults. Other products that rely on 

embedded computer microchips include telephone systems, video recorders, bar code 

readers, automatic teller machines, medical devices, factory machinery, civilian and 

military avionics, process control and monitoring equipment, sprinkler systems, and airconditioning systems. 

Automated devices such as these malfunction when they encounter situations their 

software is not designed to recognize. Sometimes the malfunction means failing to 

perform properly. Sometimes it means shutting down altogether. Many products contain 

multiple embedded systems made by multiple manufacturers. Testing these products for 

year 2000 compliance is difficult and can be expensive. 

Clearly this presents consumers -- individual, commercial, and governmental --

with considerable inconvenience. Where there is failure, the economic and legal 

consequences could be substantial. We are concerned that technological failure may also 

present health and safety problems. 
GAO 

For Release on Delivery 

Expected .. 

9:30a.m. 

Thursday. 

June 26, 1997 

GAorr·AIMD·97.114 

55 

United States General Accounting Office 

Testimony 

Before the Subcommittee on Oversight and Invesligations, 

Committee on Veterans' Affairs, House of Representatives 

VETERANS BENEFITS 

CO:MPUTER SYSTEMS 

Uninterrupted Delivery of 

Benefits Depends on Timely 

Correction of Year-2000 

Problems 

Statement of Joel C. Willemssen 

Director, Information Resources Management 

Accounting and Information Management Division 
56 

Mr. Cltainnan and Members of the Subcommittee: 

We are pleased to be here today to discuss actions being taken by the Department of 

Veterans Affairs' (VA) Veterans Benefits Administration (VBA) to address the computing 

challenges faced by virtually all major organizations--public and private-with the 

upcoming change of century. Correct and on-time delivery of benefits and services to 

some 10 million American veterans and their dependents will hinge on how quickly and 

how well the agency can meet these demands. 

Because readiness for the year 2000 is a critical issue throughout the government, we 

have recently added the year-2000 problem to our list of federal program areas at high 

risk 0! vulnerability.' As with alJ other federal agencies, VBA could face widespread 

computer systems failures as the year 2000 nears due to the potential for incorrect 

infonnation processing. This could occur because many existing computer systems have 

a 2-digit date field, such that the year 2000 would be represented by "00." However, "00" 

could also be read as 1900. Age and other calculations would be thrown off, creating 

havoc. as systems attempted to verify eligibility for various VBA programs. Because 

eligibility for many of VBA's benefits and services is date-<iependent, services could be 

seriously disrupted to millions of people. 

VBA is aware of these risks, and knows it has work to do. In a report issued to you, 

Mr. Chainnan, and being released publicly today, we detail our findings on VBA's 

'High-Risk Series: Infonnation Management and Technology (GAO/HR-97-9, February 

1997). 
57 

readiness for the change of century.' VBA has initiated action to assess its vulnerability 

and perform th ., .,.:ldifications that must be made to its information systems, but severa 

substantial risks remain. If VBA is to avert serious disruption to its ability to 

disseminate benefits, it will need to strengthen its management and oversight of year2000-related activities. Unless the systems that run VBA's programs are modified 

correctly and with adequate time for thorough testing, they will not be prepared to 

function adequately after December 31, 1999. The Department of Veterans Affairs 

concurred with all ten of our recommendations. If properly carried out, they will help 

ensure VBA', success in making its systems year-2000 compliant. 

MAKING SYSTEM<; READY FOR THE YEA!UQQQ--

A DEADLINE VBA CANNOT AFFORD TO MISS 

There is no question, Mr. Chairman, that VBA must make its key information systems 

year-2000 compliant. Unless these systems changes are made, veterans could receive 

inaccurate and / or delayed compensation and pension benefits, receive debt-collection 

letters when they do not actually owe money, cease to receive vocational rehabilitation 

services, receive inaccurate insurance benefits, or have foreclosure proceedings initiated 

unnecessarily due to erroneous date calculations. The financial stress that could accrue 

to million of Americans from incorrect calculations must be avoided. 

'Veterans Benefits Computer Systems' Risks of VBA's Year-2000 Efforts (GAO/ A1MD97,79, May 30, 1997). 

2 
58 

At VBA, compensation and pension systems that relate dates to benefits-such as dates of 

birth or military service--. )u!~ be especially vulnerable to disruption. To illustrate the 

potentially chaotic result of a system unable to tell 2000 from 1900, a veteran born in 

1925 and therefore turning 75 in 2000 could--if the computer system read "00" as 1900--be 

seen as negative 25 years old--not even born yet. The veteran would likely then be 

judged ineligible for benefits he had already been receiving. While such scenarios would 

ultimately be resolved, the ensuing delays could be a hardship for many. 

Ensuring that information systems are made year-2000 compliant is an enormous, 

difficult, and time-consuming challenge. Perhaps ironically, however, it is more 

managerial than technical. Scheduling and monitoring are especially important because 

systems must continue to work while being changed; the needs of those being served by 

these applications are not put on hold while the agency prepares for the next century. 

Consequently, as with all agencies, VBA's success or failure will reflect the quality of 

executive leadership and program management that is brought to bear on this task. It 

will be imperative for top agency management--including the agency head and the chief 

information officer, or ClO--to not only be fully aware of the importance of this 

undertaking, but to communicate this awareness and urgency to all agency personnel in 

such a way that everyone understands why year-2000 compliance is so important. The 

outcome of this challenge will also be determined by the extent to which the agency has 

institutionalized key systems-development and program-management practices. 

3 
59 

STRUCTIJRED APPROACH RlGOROUS PROGRAM MANAGEMENT REOUIRED 

Addressillg the year-2000 problem is not merely a matter of altering every computer 

system and application. Management decisions relating to impact, prioritization, and 

resources, among others, must first be made: Which systems are most important? Can they 

be converted or must they be replaced? Can corrections to any be delayed? Can any systems be 

eliminated because they overlap with others or no longer serve any useful purpose? Have 

sufficient analyses been conducted to answer these questions? Do we have adequate financial and 

personnel resources? Must our internal capabilities be upgraded? 

GAO has developed a guide' that constitutes a framework that agencies can use to 

assess their readiness to achieve year-20CJ() compliance. It provides information on the 

scope of the challenge and offers a structured approach for reviewing the adequacy of 

agency planning and management of its year-2000 program. An exposure draft of the 

guide was released in February; it incorporates guidance and practices identified by 

leading information technology organizations. We have made copies available to VA 

and to VBA. 

The guide describes in detail the five phases involved in this challenge. Since we see 

each as critical to a successful year-2000 program, I would like to take a few minutes to 

briefly discuss them. 

'Year 2000 Computing Crisis: An Assessment Gujde [exposure draft) (GAOl AIMD10.1.14, February 1997). 

4 
60 

AWARENESS. While this may seem obvious or unnecessary, we have found that neither 

is true. Agency personnel must get the word-fr-::n l~e top-as to what this project is all 

about, and why it matters. Also in this stage, the agency team that will attack the 

problem IS identified, and begins examining potential impacts and developing a strategy. 

ASSESSMENT. When everything is a priority, nothing is a priority. The emphasis in 

this phase is on setting realistic priorities-those based on assessments of the potential 

risk of systems' not being year-2000 compliant, and the likely impact. Systems that are 

mission-critical--which therefore must be converted or replaced-need to be distinguished 

from important ones that should be changed and marginal ones that could be changed 

now or deferred . Such priority-setting is absolutely essential, and should be undertaken 

from a business standpoint: systems that are integra; to the agency's main function and 

on which its customers depend should receive the highest priority. Testing strategies 

must also be devised, and contingency plans developed. 

RENOVATION. This phase deals with actual changes--converting, replacing, or 

eliminating selected systems and applications. In doing this it is important to consider 

the complex interdependencies among systems, and ensure that changes are consistent 

agencywide and that information about all changes is widely disseminated to users. 

VAlIDATION. Here, agencies test, verify, and validate all converted or replaced systems 

and applications, ensuring that they perform as expected. It is likewise important that 

5 
61 

testing procedures themselves be tested, so that agencies can be sure that their results 

can be trusted. This critical phase can extend over a full ye,". ann may take up to half 

an agency's funds hl1dgeted for the entire year-2000 program. It is, however, necessaryand worth the cost. Unless changed systems reliably work as needed, the rest of the 

expenditure is wasted. 

IMPLEMENTATION. Deploying and implementing compliant systems and components 

requires extensive integration and acceptance testing. And since not all agency systems 

will be converted or replaced simultaneously, it may be wise to operate in a parallelprocessing environment for a period of time, running old and new systems side-by-side. 

Such redundancy can act as a fail-safe mechanism until it is clear that all changed 

systems are operating correctly. 

YBA TODAY: ENCOURAGING ACTIONS INITIATED 

BUT SIGNIFICANT RISKS REMAIN 

VBA clearly recognizes that the upcoming change of century poses serious challenges, 

and began analyzing the problem in 1991. Its information resources management 

support plan, issued this past January, states unambiguously that achieving year-2000 

compliance is the agency's number one priority. The agency has developed a year-2000 

charter, which defines a project-management organization and designates a project 

6 
62 

manager, along with coordinators at each of VBA's three systems-development centers: 

Hines, Illinois; Austin, Texas; and Philadelphia. 

Initially, the primary focus of VBA's strategy was to attain compliance by replacing 

noncompliant systems with new ones. Its goal was to have all systems and applications 

compliant by November 30,1998, thus allowing over a year for testing and monitoring. 

VBA also developed a contingency plan, for its compensation and pension and 

educational assistance payment systems, to ensure continued operation into the next 

century should replacement systems not be implemented in time. On the basis of 

concerns we raised regarding VBA's year-2000 strategy, the agency recently revised it to 

focus on making changes to its existing noncompliant systems rather than replacing 

them. Many of these efforts, however, remain unfinished. Some important ubstacles to 

success remain, Mr. Chairman, in the areas of program management, assessment, 

contingency planning, and the handling of noncompliant systems. 

First, the structure of VBA's year-2000 program management office needs strengthening, 

and technical and managerial issues must be addressed. An agency-level program office 

must coordinate and manage the full range of interdependent information systems 

activities involved in the year-2000 effort. Yet, according to VBA's year-2000 project 

manager, her management functions were limited to conversion projects for the 

compensation and pension and educational assistance payment systems, and 

replacement projects for educational assistance payment systems, The functions of 

7 
63 

VBA's year-2000 project manager also do not include oversight of locally developed 

applications used by the 58 regional offices. 

In commenting on a draft of our report, the Secretary of Veterans Affairs concurred with 

our recommendation that VBA strengthen its year-2000 program management office. He 

has stated that VBA's year-2000 project manager has been relieved of other duties to 

devote full attention to year-2000 activities. V A also has established an oversight 

committee to monitor and evaluate. the progress of VBA's year-2000 effort. 

A critical technical deficiency is VBA's lack of an overall, integrated systems architecture, 

or blueprint, to guide and constrain the development of replacement systems and the 

evolution of related information systems. The Clinger-Cohen Act of 1996 requires, 

among other provisions, that department-level chief information officers develop, 

maintain, and facilitate integrated systems architectures. Without such a tool, successful 

systems integration through common standards is placed at added risk. 

Specifically, VBA has not yet developed, or has not documented, a comprehensive 

analysis of the flow of information among the various systems; further, it has not yet 

adequately (1) defined the interfaces among systems that must share data in order to 

facilitate delivery of benefits, (2) defined a security architecture because sufficient 

analysis to allow this has not been performed, or (3) analyzed characteristics or 

developed standards for measuring performance. Also, it is permitting changes to the 

8 
64 

database and data elements themselves without insisting on the appropriate qualityassurance steps. 

The Secretary concurred with our recommendation that \fBA develop a complete, 

integrated systems architecture for its new systems development activities. He further 

stated that VBA is documenting its systems architecture, information architecture, and 

data architecture. Also, VBA is still developing security services common to all 

applications and performance characteristics and standards. 

A second obstacle to VBA's success in being ready for the year 2000 concerns the fact 

that much work remains in determining whether its information systems and their 

components are compliant now. VBA has yet to fully assess the severity of its year-2000 

problem. And while inventories of regional applications and internal/ external interfaces 

have been started, they are not yet complete. 

According to VBA's December 1996 year-2ooo plan, it expected to have completed all 

inventories by September 30, 1996. By that date, however, inventories had been 

completed only for software applications at its three systems-development centers. 

According to VBA's January 28, 1997, year-2000 risk assessment, part of the reason for 

the delay is the agency's loss of some well-qualified employees to retirement during 

recent agency buyouts. Regardless of the reason, however, VBA's challenge is more 

difficult because it has less time and fewer experienced personnel. 

9 
65 

VBA's February 17, 1997, inventory shows 153 applications, consisting of over 8,400 

modules and over 9 million lines of computer software code. VBA determined that 111 

of the 153 applications--alrnost three quarters--were noncompliant. Decisions relating to 

about a third of these noncompliant applications had not been made as of that date. 

Further, this inventory does not include local applications developed by regional offices. 

While VBA's CIO has requested that regional offices develop such inventories, he further 

stated that no regional applications need be included in the inventory of software 

applications because no locally-developed applications were mission-i:ritical. Yet 

according to VA's year-2000 readiness review, without a complete inventory of 

regionally-developed applications, VBA cannot adequately predict or plan for the impact 

of the change of century. 

The Secretary concurred with our recommendation that VBA perform an assessment of 

how its major business areas would be affected if the year-2000 problem were not 

corrected in time to help prioritize the agency's year-2000 activities. He stated that such 

an overall assessment has been completed, and that VBA concluded that all major 

business areas would be severely affected. The Secretary did not consider it beneficial to 

spend time developing a detailed analysis when the general business impact is already 

known. We believe, however, that even when general impact is known, a detailed 

assessment provides management with valuable information on which to prioritize 

10 
66 

activities, as well as a means of obtaining and publicizing management commitment and 

support for necessary initiatives. 

Regarding VBA's inventory of interfaces, the Secretary stated that VBA expects to have 

this inventory completed by June 30. He stated that the assessment of interfaces is more 

complicated because VBA, like other government agencies, is dependent upon receiving 

information from other agencies. In addition, the newly-established oversight committee 

plans to assess whether VBA's program management office needs to oversee the year2000 work in the regional offices and include regional applications in its inventory. 

A third obstacle is that VBA has not developed contingency plans for all of its critical 

systems. Three of its major business areas- loan guaranty, vocational rehabilitation and 

counseling, and insurance--lack contingency plans to ensure continuity of operations. 

We recently learned that such plans are in development for the loan-guaranty system. 

VBA managers realize that they may have to return to manual processing if critical 

systems in these major business areas are not made year-2000 compliant in time. 

In his comments on a draft of our report, the Secretary also concurred with our 

recommendation that VBA develop a year-2000 contingency plan for all critical 

information systems. He stated that VBA is addressing the development of contingency 

plans with each program manager. 

11 
67 

Fourth, VBA does not yet have sufficient information about the costs and risks associated 

with its year-2000 activities. As a consequence, it has no basis on which to make 

decisions about prioritizing its information technology projects to make the best use of 

its two vital resources: people and money. Its year-2000 strategy calls for converting 

most existing systems while simultaneously continuing to replace its existing benefits 

payment systems. Yet both actions depend upon limited financial and personnel 

resources; it may not be able to complete either in time. 

Reliable assessments of costs and risks are important prerequisites for effective 

prioritization of information technology projects. VA's readiness assessment estimated 

VBA's year-2000 costs at about $20 million for fiscal years 1996 through 1999. This, 

however, only included conversion projects, such as those to upgrade the mainframes 

and operating systems at the Hines and Philadelphia data centers. It did not include 

costs to replace VBA's aging systems with new, compliant payment systems. 

The Secretary concurred with our recommendation that VBA assess the costs, benefits, 

and risks of competing information technology projects and prioritize them to make 

effective use of limited people and financial resources. He indicated, however, that this 

assessment has been completed. But in light of VBA's recent decision to make year-2000 

changes to its existing systems its top priority, rather than relying on replacement 

systems, we believe that VBA must reevaluate its cost/benefit and risk assessments 

under this new strategy. The results of this evaluation are especially important, since in 

12 
68 

foc'.!sing on conversion of noncompliant benefits payment systems, VBA has decided to 

exclude only replacement of these specific systems from its overall year-2000 strategy, 

rather than discontinue the overall replacement strategy altogether. As a result, VBA's 

new year-2000 strategy and replacement project effort continue to be dependent upon 

limited personnel and financial resources. 

STRONG PROGRAM OVERSIGHT ESSENTIAL· 

INVENTORIES AND ASSESSMENTS MUST BE COMPLEIED QUICKLY 

ALONG WITH CONVERSIONS AND CONTINGENCY PLANS 

M~. Chairman, we all agree that VBA must do whatever it takes to be year-2000 

compliant. This will not be easy. Until an inventory and assessment of its information 

systems and their components is completed, it will not be able to make informed choices 

about the best use of limited personnel and financial resources. Once this has been 

accomplished, it may be necessary to reallocate resources toward completing the 

conversion projects and developing contingency plans for all critical noncompliant 

systems. A stronger program management office structure and improved technical and 

managerial capabilities will be essential ingredients in helping to make this happen. 

Given the serious risks associated with VBA's year-2000 activities, our report 

recommends that the Secretary of Veterans Affairs direct and ensure that VBA's acting 

undersecretary for benefits, in conjunction with VBA's CIO, take ten specific actions to 

13 
69 

help ensure the agency's success in making its systems year-l000 compliant before the 

change of (.mturv. I have already discussed some of these recommendations in my 

testimony today. In summary, these actions involve strengthening program management 

and oversight; developing an integrated systems architecture; assessing the vulnerability 

of VBA's major business areas to failing to achieve systems compliance in tinie; 

completing inventories, analyses, and assessments; developing a schedule for systems 

conversion/replacement; and developing critical contingency plans. 

We discus3ed our findings with both VA's and VBA's eIOs at the conclusion of our 

review. Not only did they agree with all of our recommendations, but in addition took 

quick action to address areas of concern that we identified. We were told that VBA is 

redirecting its yei\r-2000 strategy to focus on the conversion of existing benefits payment 

systems. Further, V A has established an oversight committee comprising a VBA 

executive, a senior manager from VA's Office of Information Resources Management, 

and an independent contractor, to evaluate VBA's progress in year-2000 readiness. The 

contractor is to report this August, and is to include an action plan detailing what will 

be required for VBA to complete software recoding in December 1998. As we said in 

our report, we are encouraged by these specific steps and we commend the agency both 

for its receptivity and speed of response. We will continue to work with VBA in 

evaluating its plans and strategies for accomplishing its goals. 

14 
70 

Mr. Chairman, this concludes my statement. I would be pleased to respond to any 

questions that you or other members of the Subcommittee may have at this time. 

(511218) 

15 
71 

STATEMENT BY 

THE HONORABLE D. MARK CATLETT 

ASSISTANT SECRETARY FOR MANAGEMENT AND 

CHIEF INFORMATION OFFICER 

DEPARTMENT OF VETERANS AFFAIRS 

BEFORE THE 

SUBCOMMITTEE ON OVERSIGHT AND INVESTIGATIONS, 

COMMITTEE ON VETERANS' AFFAIRS 

U.S. HOUSE OF REPRESENTATIVES 

JUNE 26, 1997 

Introduction 

Mr. Chairman and Members of the Subcommittee, it is my pleasure to testify 

on behalf of the Department of Veterans Affairs rv A) concerning the 

readiness of our information systems for the Year 2000. I am accompanied 

today by the Veterans Health Administration cYHA) ChiefInformation 

Officer, Mr. R. David Albinson, and the Veterans Benefits Administration 

0IBA) Chief Information Officer, Mr. Newell E. Quinton. 

As VA's Chief Information Officer (CIO), I have established close working 

relationships with VA's Administration-level CIOs to lead our efforts in 

becoming Year 2000 compliant~nsuring our information systems 

function correctly when using dates beyond 1999. We are working 

vigorously to make sure VA's information systems will provide 

uninterrupted service supporting the full range of veterans benefits 

delivery and medical care. 

I appreciate the opportunity to appear before you today to bring the 

Subcommittee up-to-date on steps we are taking and our progress in 

resolving Year 2000 problems. In pursuit of our solution, we are following 

the standardized, governmentwide Year 2000 best practices phases 

established by the Office of Management and Budget (OMB) in conjunction 

with the Federal CIO Council Subcommittee on Year 2000. Let me provide a 

brief definition of each phase: 

Assessment - Refers to determining the scope of the problem by creating an 

inventory of applications and deciding which ones to change, replace or 

eliminate. 

Renovation - Concerns the modification, replacement or elimination of an 

application to make it Year 2000 compliant. Year 2000 compliant means the 

referenced application can process dates beyond 1999. 

Page 1 
72 

Validation - Refers to the validation of new or changed code for date handling 

and functionality. Completion of this phase means that unit testing and 

management approval have all been completed, validating the Year 2000 

changes. 

Implementation - Completion of full system testing and the placement 

into use of the revised systems. Applications and systems can process 

dates beyond 1999 properly and are in production use. 

VA's strategic approach is to make our existing mission-critical systems 

compliant in their current environment. We have identified our missioncritical systems, prepared detailed plans and inventories of our mission 

critical systems, and assigned levels of priority to the applications supporting 

these mission-critical systems. 

Accountability and Monthly Year 2000 Reporting Requirements 

As VA's CIO, I am responsible for overseeing and ensuring the completion of 

the Year 2000 project for all VA systems. The VBA CIO; VHA CIO; and 

senior information technology managers in the National Cemetery System 

(NCS) and staff offices are responsible for developing specific plans and 

managing the projects within their respective jurisdictions. 

Monthly Report 

On March 7, 1997, my office established a detailed internal report to track 

our progress in addressing Year 2000 problems. This monthly report, 

modeled after OMB's governmentwide Year 2000 quarterly report, measures 

the progress of each VA administration for each of the established phases. 

The report includes quantitative measures that are based on the percentage 

completed for each OMB phase. We are measuring the progress of each 

individual application against the four phases. In addition to this formal 

reporting mechanism, the Administration-level CIO's and their Year 2000 

program officials meet with me monthly to provide status reports addressing 

their successes and progress toward meeting the milestones presented in 

their plans. 

Monitoring monthly progress reports from each organization provides my 

office with early notice should an organization fall behind schedule. This 

early notice gives me the ability to recommend to VA's Chief Operating 

Officer, the Deputy Secretary, necessary redirection and refocusing of 

appropriate resources to bring an organization back on schedule. We are 

committed to ensuring that veterans receive uninterrupted services up to and 

beyond Janu:ary 1, 2000. 

Page 2 
73 

Prioritization of Applications 

We have prioritized our applications to ensure Year 2000 impacts will not 

adversely affect the delivery of benefits or medical care to our veteran 

population. We have established a three-tiered structure, providing a 

common VA-wide priority ranking for VA's applications inventories. 

Level I - Business Priority Systems: These are systems that will 

directly impact the delivery of medical care and benefits to veterans or 

are essential to the Department's mission. 

Level II - Internal Support Systems: These include internal agency 

systems used to improve timeliness and efficiency of administrative 

processes; operations support; or producing periodic reports. These are 

systems whose failures would not be deemed as having a direct, adverse 

effect on veterans. 

Level III - Discontinued Systems: These are systems scheduled for 

discontinuation, prior to the year 2000. They may include systems 

scheduled for elimination because there is no further legislative 

requirement or program need to maintain them. 

VA Management Actions to Assure Year 2000 Compliance 

VA has been utilizing the interim Federal Acquisition Regulations (FAR) 

Year 2000 compliance language since it was issued in January 1997. Prior to 

that, we used the language recommended by the Federal CIa Council 

Subcommittee on Year 2000. For example, VA's Procurement of Computer 

Hardware and Software (PCHS) contract, our major information technology 

equipment and software contract, contains the language recommended by the 

Federal CIa Council Subcommittee on Year 2000. The language developed 

by the Subcommittee on Year 2000 was incorporated into the interim FAR. 

In October 1996, VBA and the Austin Automation Center began sending 

letters to commercial-off-the-shelf (COTS) providers concerning individual 

products' Year 2000 compliance. Vendors are being requested to certify that 

their products are compliant. Since these COTS products are also in use 

within VHA, the information is being shared with VHA. VHA has conducted 

an initial survey of COTS products at VHA facilities. VA will also utilize and 

share information with the governmentwide COTS compliance web page 

under development by the CIa Council Subcommittee on Year 2000. 

Page 3 
74 

VA Year 2000 Readiness Review 

In addition to the monthly reports, my office has plans to conduct 

independent Departmental reviews similar to our Year 2000 Readiness 

Review last year of the major VA organizations. A copy of the Year 2000 

Readiness Review was provided to the Subcommittee in Februarv 1997. 

We are planning a follow-up independent review during the first quarter 

of fiscal year 1998. During the first review, over 80 information systems 

professionals and managers were interviewed in Washington, DC, and 

various field locations, including the Austin Automation Center (AAC), 

Benefits Delivery Centers, and medical centers. We independently 

assessed our readiness, plans, testing methodologies, contingencies, 

inventories, and cost estimates. 

Year 2000 Proiect Offices 

Both VBA and VHA have established Year 2000 Project Offices that 

report directly to their organization's cra. These Project Offices provide 

for the planning, guidance, oversight and technical support for their 

organization's Year 2000 efforts. 

VA's Status in Preparing Our Systems for the Year 2000 

I would like to take this opportunity to update the committee on our 

organizational progress. 

National Cemetery System 

The information systems supporting NCS are fully Year 2000 compliant. 

Non-compliant NCS systems were replaced in December 1996. 

Page 4 
75 

Veterans Benefits Administration 

VBA has redirected its efforts and made Year 2000 its number one 

organization priority. VBA has completed the assessment phase of its 

systems. VBA's plan is to complete the renovation phase by November 

1998, validation by December 1998 and implementation by June 1999. 

VBA has recently awarded four task orders to bring contractor support on 

board. Three of these task orders are for renovation of applications and one 

is for project oversight. We have also amended an existing task order to 

increase the level of Year 2000 support to our project managers. These 

efforts have been part of our planning for several months. 

The Compensation and Pension application will use contractors for 

renovation. In this application, making legislative program changes and 

preparing for the annual cost of living adjustments requires much time and 

effort. With the contractors focusing on the year 2000 renovation, our staff -

can proceed with the complexities of implementing legislative changes 

without interruption. 

We have also taken the contractual actions necessary to acquire a compliant 

Honeywell 9000 platform for Year 2000 testing. As you know, the Honeywell 

supports our Compensation, Pension, Education and Vocational 

Rehabilitation applications. 

As of May 31, 1997,38 percent ofVBA's applications have been 

renovated and made Year 2000 compliant. Another 5 percent of their 

applications are in testing. Therefore, over the next few months, the 

percentage of compliant applications will continue to rise. Every 

application has been addressed and VBA has a fix solution and a planned 

fix date for all of its applications. 

Veterans Health Administration (VHA) 

VIlA completed the development of its comprehensive Year 2000 plan on 

April 30, 1997. 

VIlA's goal is to complete its assessment, including the nationwide 

assessment of biomedical equipment at VA medical facilities, by January 

1998. VIlA's plan is to complete any necessary renovation by July 1998, 

validation by January 1999 and implementation by October 1999. As of May 

31, 1997, 23 percent of VIlA's Veterans Health Information Systems and 

Technology Architecture (VISTA) applications are compliant. This 

percentage represents VISTA applications scheduled for discontinuation. 

Page 5 
76 

VHA Year 2000 Plan 

VHA's Year 2000 plan addresses areas beyond information systems, such as 

biomedical equipment currently in use at VA's medical facilities. The plan 

provides details on the role ofVHA's Year 2000 Project Office in supporting 

and assisting VHA's 22 Veterans Integrated Services Network (VISN) offices 

in their efforts to achieve compliance throughout the medical facilities in 

their networks. 

Biomedical Eguipment 

The potential Year 2000 impact on biomedical equipment is a national issue, 

affecting both the private sector and federal health care communities. VA, 

along with other agencies and the private health care community, are 

consumers of biomedical equipment; we do not regulate the industry. 

VA recommended to OMB in January that an interagency committee, chaired 

by the Department of Health and Human Services (HIlS), be established to 

deal with this issue. The first meeting of the committee was held on May 9, 

1997, at which a general course of action was developed. The Food and Drug. 

Administration (FDA) in their role as regulators of medical devices and 

biomedical equipment, such as pacemakers and defibrillators, will ensure 

that these devices are Year 2000 compliant. 

We will coordinate a public awareness campaign with HIlS as it particularly 

affects veterans with medical devices in their bodies or in use in their homes. 

Additionally, our patients will be advised as to the status of medical center 

equipment when the work of the HHS committee has identified potential 

problems. 

VA's Austin Automation Center (AAC) 

We are especially proud ofthe progress we have made at the AAC 

considering the size and complexity ofits computer systems. The AAC 

provides VA-wide information technology support to all components 

within the Department. As of May 31, 1997,74 percent of the 

applications they support have been renovated and are Year 2000 

compliant. The AAC plan is to have all systems renovated by September 

1998, validated by October 1998, and fully implemented by September 

1999. 

Page 6 
77 

Summary 

VA organizations have prepared detailed systems inventories, and 

developed testing methodologies, individual project plans and 

contingencies. We are monitoring our progress for each application 

supporting our mission-critical systems. We are also monitoring such key 

elements as estimated lines-of-code, number of modules, operating 

systems and commercial-off-the-shelf (COTS) packages. 

We will continue to work with the Federal CIO Council Subcommittee on the 

Year 2000 and continue sharing information among Federal agencies. We 

will continue to work with the HHS's chaired biomedical committee to resolve 

potential issues with biomedical equipment. 

We are confident that VA will be ready for the coming millennium. VAfullr 

intends that its information systems will continue to provide uninterrupted 

support to our programs and ensure that we provide the highest quality 

benefits delivery and medical care to our Nation's veterans and their 

families. I thank you for this opportunity to present our progress in 

preparing for the Year 2000. Mr. Albinson, Mr. Quinton and I would be 

happy to answer any questions you might have. 

Page 7 
78 

( .• ~ DEPARTMENT OF HEALTH &. HUMAN SERVICES 

· ... 4 Public Heatth Service 

STATEXIlH'l 

BY 

THOMAS SHOPB, Ph.D. 

Food and Drug Administration 

Rockville MD 20857 

ACTING DIRECTOR, DIVISION OP BLECTRONICS AND COMPUTBR SCIENCB, 

OPPICB OP SCIBNCB AND TECHNOLOGY 

CENTBR POR DEVICBS AND RADIOLOGICAL HEALTH 

POOD AND DRUG ADMINISTRATION 

DEPARTMENT OP HBALTH AND HUMAN SBRVICES 

BBPORE THB 

SUBCOMMITTBE ON OVERSIGHT AND INVESTIGATIONS 

COMMITTEE ON VETERANS AFPAIRS 

U.S. HOUSB OP REPRl!iSENTATIVBS 

JUNE 26, 1997 

FOR Rl!iLEASB ONLY UPON DELIVERY 
79 

INTROPUCTION 

Good morning, Mr. Chairman and Members ot the Subcommittee. My 

name is Dr. Thomas Shope. I am the Acting Director, Division of 

Electronics and computer Science, ottice ot Science ahd 

Technology, Center for Devices and Radiological Health (CDRH) , 

Food and Drug Administration (FDA). I am pleased to be here to 

provide information about the 'Year 2000" date issue as it 

relates to medical devices. 

WHAT IS A MEpICAI. PEVICE? 

According to the definition in the Federal Food, Drug, and 

Cosmetic Act (FD&C Act), a 'device" is: 

an instrument, apparatus, implement, machine, contrivance, 

implant, in vitro reagent, or other similar or related 

article, including any component, part or accessory, which 

is intended for use in the diagnosis of disease or other 

conditions, or in the cure, mitigation, treatment, or 

prevention of disease, in man or other animals, or intended 

to affect the structure or any function of the body and 

which does not achieve its primary intended purposes through 

chemical action and which is not dependent upon being 

metabolized for the achievement of its primary intended 

purposes. 
80 

As this definition suggests, many different types of products are 

properly regulated as medical devices. Medical devices include 

over 100,000 products in more than 1,700 categories. These 

products regulated by FDA as medical devices range from simple 

everyday articles such as thermometers, tongue depre~sors, and 

heating pads, to the more complex devices such as pacemakers, 

intrauterine devices, fetal stents and kidney dialysis machines. 

FDA is responsible for protecting public health by helping to 

ensure that medical devices are safe and effective. FDA carries 

out its mission by evaluating new products before they are 

marketed; assuring quality control in manufacture through 

inspection and enforcement activities; and monitoring adverse 

events in already marketed products, taking action, when 

necessary, to prevent injury or death. A device manufacturer 

must comply with all the requirements of the FD&C Act, including: 

establishment registration and device listing, premarket review, 

use of good manufacturing practices (GMPs), reporting adverse 

events, and others. 

As diverse as medical devices are, so are the range and 

complexity of problems that can arise from their use. These 

problems include mechanical failure, faulty design, poor 

manufacturing quality, adverse effects of materials implanted in 

the body, improper maintenance/specifications, user error~_ 

2 
81 

compromised sterility/shelf life and electromagnetic interference 

among devices. 

Any computer software that meets the legal definition of a 

medical device is subject to applicable FDA medical device 

regulations. Medical devices which use computers or software can 

take several forms including: embedded microchips which are part 

of, or components of, devices; or non-embedded software used 

with, or to control, devices or record data from devices; or 

individual software programs which use or process patient data to 

reach a diagnosis, aid in therapy or track donors and prOducts. 

An issue that has been identified as warranting review is the 

impact of the ·Year 2000" on some medical device computer systems 

and software applications. These products could b. impacted by 

the ·Year 2000" date problem only if they use a date in their 

algorithm or calculations, or in record keeping; and a two-digit 

year format was us.ed in their design. Manufacturers of such 

products are the only reliable source of information as to the 

details of the methods used in the programming and whether these 

two conditions are met. While we are in the process of reviewing 

this issue, we do not currently believe that there will be any 

major impact on medical device safety. 

3 
82 

Embedded Software 

computer software frequently is embedded as a 'component" of 

devices, i.e., software contained on a microchip to control 

device operation. Examples of such devices are: pacemakers, 

infusion pumps, ventilators, and many others. It is unlikely 

that most of these products would be impacted by the 'Year 2000" 

problem. Almost none of these .devices require knowledge of the 

current date to operate safely and effectively. For example, 

pacemakers do not use the current date in their operation. 

Non-embedded softWare 

Non-embedded software is intended to be operated on a separate 

computer, often a personal computer or work station. Such 

software devices may be used to enhance the operation of another 

device or devices and, further, may use the two-digit year 

format. It is possible that non-embedded software devices may 

rely on the current date for proper operation and, further, may 

use the two-digit year format. Such products might be affected 

by the 'Year 2000" date change. 

An example of non-embedded software is a computer program used to 

plan radiation therapy treatments delivered using radioactive 

4 
isotopes as the radiation source (teletherapy or brachytherapy). 

These treatments possibly could be affected if the computer 

program used to calculate the radiation dose parameters uses only 

a two~digit year representation. The calculation of the lenqth 

of time since the source was last calibrated could be in error 

and thus lead to an incorrect treatment prescription. 

Other examples of non-embedded software devices include: 

conversion of pacemaker telemetry data; conversion, transmission 

or storage of medical images; off-line analysis of EEG data; 

digital analysis and graphical presentation of EEG data; 

calculation of rate response for -a cardiac pacemaker; perfusion 

calculations for cardiopulmonary bypass; and calculation of bone 

fracture risk from bone densitometry data. While there is a 

chance that the two-digit format may affect the performance of 

these software devices, we believe that the ·Year 2000" risk will 

be mitigated through proactively working with manufacturers. 

Letter to Medical peyice Manufacturers 

In light of our review of the impact of the ·Year 2000· on some 

medical device computer systems and software applications, CDRH 

is preparing to send a letter to all medical device manufacturers 

to ensure that manufacturers address this issue and review both 

5 
84 

embedded and non-embedded software products. We will remind 

manufacturers that, in addition to potentially affecting the 

functioning of some devices, the two-digit year format also could 

affect computer-controlled design, production or quality control 

processes. We will request that the manufacturers review the -

software used to determine if there is any risk. 

CORH will recommend specific actions to ensure the continued 

safety and effectiveness of these devices. For currently 

manufactured medical devices, manufacturers should conduct hazard 

and safety analyses to determine whether device performance could 

be affected by the 'Year 2000" date change. If these analyses 

show that device safety or effectiveness could be affected, then 

appropriate steps should be taken to correct current production 

and to assist customers who have purchased such devices. For 

computer-controlled design. production and quality control 

processes, manufacturers should assure that two-digit date 

formats or computations do not cause problems beginning 

January 1, 2000. 

In our letter to industry, we will remind manufacturers that 

under the GMP regulation and the current Quality system 

Regulation (which became effective June 1, and incorporates a set 

of checks and balances in manufacturers' design processes to 

assure a safe, effective finished product), they must investigate 

6 
85 

and correct problems with medical devices that present a 

significant risk to public health. This includes devices that 

fail to operate according to their specifications because of 

inaccurate date recording and/or calculations. 

As a result of our letter, we expect manufacturers who identify 

products which have a date-related problem which can pose a 

significant risk to the patient to take the necessary action to 

remedy the problem. This might include notification of device 

purchasers so that their device can be appropriately modified 

before the 'Year 2000." Manufacturers who discover a significant 

risk presented by a date problem are required to notify CORK and 

take appropriate action. Again, we do not anticipate any 

significant problems with individual medical devices, however, we 

want to ensure the continued safety and effectiveness of these 

devices. 

For ~ medical device premarket submissions, manufacturers of 

devices whose safe operation could be affected by the 'Year 2000" 

date change will be required to demonstrate that the products can 

perform date recording and computations properly, i.e., ·Year. 

2000" compliant. 

7 
86 

CONCLUSION 

Thank you, Mr. Chairman, for the opportunity to tell you about 

the issue of "Year 2000" and medical devices. Let me assure you, 

we at FDA take this issue very seriously as we do all. problems 

that could affect the public health. We are committed to a 

scientifically sound regulatory environment that will provide 

Americans with the best medical care. In the public interest, 

FDA's commitment to industry must be coupled with a reciprocal 

commitment: that medical device firms will meet high standards in 

the design, manufacture, and evaluation of their products. We 

recognize that this can only be attained through a collaborative 

effort -- between FDA and industry -- grounded in mutual respect 

and responsibility. The protections afforded the American 

consumer, and the benefits provided the medical device industry, 

cannot be underestimated. 

8 
87 

WRITTEN COMMITrEE QUESTIONS AND THEIR RESPONSES 

CONGRESSMAN EVANS TO DEPARTMENT OF VETERANS AFFAIRS 

POST·HEARlNG QUESTIONS 

CONCERNING THE JUNE 26, 1997 

HOUSE VETERANS' AFFAIRS COMMITrEEI 

SUBCOMMITTEE ON OVERSIGHT AND INVESTIGATIONS 

HEARING ON VA'S COMPLIANCE WITH 

YEAR 2000 REQUIREMENTS 

FROM THE HONORABLE LANE EVANS 

RANKING DEMOCRATIC MEMBER 

COMMITrEE ON VETERANS' AFFAIRS 

U.s. HOUSE OF REPRESENTATIVES 

I. The General Accounting Office has indicated that the testing phase of 

achieving Year 2000 compliance is perhaps the most critical stage of the 

process. According to GAO, this phase "can extend over a full year, and 

may take up to half an agency's funds budgeted for the entire Year 2000 

program." Mr. Catlett, how much time will VA devote to this "testing" 

phase, and what proportion of the VA's budgeted Year 2000 funds will be 

set aside to complete this phase? 

VA has estimated that the validation and implementation (testing) phases will 

require approximately 40 percent to 60 percent of the Year 2000 totallifecycle 

time, effort and resources. VA's Year 2000 testing schedules will assure that every 

renovated application is adequately validated and tested prior to implementation. 

FTE e~ources and test schedules for each individual mission critical application 

have been estimated. VA performs testing incrementally as soon as each 

application is renovated. We have already begun the validation and 

implementation of renovated applications. VA's schedule is to complete the 

renovation phase by November 1998, validation phase by January 1999, and 

implementation by October 1999 for mission critical applications. VA utilizes its 

existing quality assurance and testing process teams in conducting actual testing 

activities so separate funds are not set aside. 

2. GAO's testimony indicates that the Veterans Benefits Administration 

(VBA) Year 2000 program management office "needs strengthening, and 

that technical and managerial issues must be addressed." Please identify 

the VBA program officer responsible for coordinating and manlllPng the 

VBA's compliance efforts, and explain in detail the steps VA has taken to 

address the GAO's concerns in this area. 

Mr. Newell Quinton, the Veterans Benefits Administration (VBA) Chief 

Information Officer (CIO) has overall responsibility for ensuring Year 2000 

compliance. Ms. Sally Wallace is the VBA Year 2000 Project Manager. To 

alleviate GAO concerns, the Year 2000 Project Manager has been relieved of non· 

Year 2000 duties, and the Year 2000 Project Office has been elevated and reports 

directly to VBA's CIO. Monthly briefings are provided to the VA CIO and VBA 

Under Secretary on VBA's Year 2000 progress. Quarterly briefings are provided to 

the Deputy Secretary on VBA's progress. 

VBA has contracted with KPMG Peat Marwick to assist with Year 2000 project 

management support. In the last several months, VBA has instituted reporting 

procedures to insure that the VBA Year 2000 Project Office receives current status 

and tracking reports. In addition, VA established a committee to oversee the 

VBA's Year 2000 project. This committee is composed of representatives from the 

Office of Management and VBA, and is supported by a contractor, SRA 

International. Currently, the oversight team is conducting an assessment of the 

status ofthe VBA Year 2000 project to date. 
88 

3. GAO's testimony Indicates that VBA has yet to develop and/or 

document overall, integrated analysis of the flow of information among 

the various computer systems within VBA that will Insure that data can 

be shared among systems and that veterans wiD be able to receive 

benefits in a timely fashion In the year 2000 and beyond. Please esplain 

in detail how the Department will address these serious concerns? When 

will VA complete its plans in this regard? 

VBA has been working tbe Year 2000 problem since tbe early 1990's. In July 

1996, tbe first version of VB A's Year 2000 plan was published. We have detailed 

milestones and a fix for every application. As of June 30, 1997, 41% of our 

applications are compliant. To insure compatibility and interoperability among 

our various systems, all information technology components are being assessed for 

compliance, including all hardware, software and third party products. Data 

interfaces and exchanges are also being analyzed and are being worked to insure 

that data can be shared among systems. VBA's interface inventory was completed 

in June 1997. We take tbe Year 2000 problem very seriously. There is no doubt 

that veterans will be able to receive benefits in a timely fashion in the Year 2000 

and beyond. 

4. In reviewing the GAO's testimony I am troubled to read that the ''VBA 

has yet to fuUy assess the severity of its year·2000 problem," and that 

"while Inventories of regional applications and Interfaces have been 

started, they are not yet complete." Mr. Catlett, the VA promised that it 

would complete such an assessment of all Inventories by September of 

last year, but the GAO indicates that such an assessment has yet to be 

completed. Why hasn't the VA completed this very basic assessment, and 

when will such an assessment be complete? 

VBA completed its inventory and assessment of its mission critical systems, 

including those that reside in Regional Offices in July 1996. VBA's interface 

inventory was completed in June 1997. It is true tbat VBA has not yet completed 

the assessment of small, non-mission critical applications at Regional Offices. 

Non-mission critical items are being worked as time permits. The VA Regional 

Offices are responsible for tbeir own locally developed non-mission critical 

applications. VBA's CIO provided guidance to regional offices in September 1996 

concerning their Year 2000 responsibilities. VBA's Year 2000 Project Office, 

working with VBA's Area Offices, has tbe responsibility in overseeing VA Regional 

Offices Year 2000 efforts on locally developed non-mission critical applications. 

VHA has a comprehensive plan to complete inventories and assessments of all 

system products by January 1998. A copy of this plan was provided to the 

Conunittee on June 20, 1997. 

There was no September 1996 milestone to complete Regional Office application 

and interface inventories. VA's overall milestone for completing the assessment 

phase is January 1998. The milestones for VA's Year 2000 efforts are contained in 

VA's Year 2000 quarterly report to OMB and Year 2000 Solutions document. 

Copies of this report and document were provided to tbe Conunittee. 

5. Mr. Catlett, given that the VA has been unable to meet its own 

inventory deadlines for the VBA and the VHA, how can the VA 

adequately predict or plan for the potential Year 2000 impact on 

veterans? 

VA has not missed its inventory and assessment deadlines. VBA's mission-critical 

systems have been inventoried and assessed, including mission-critical systems 
89 

residing in Regional Offices. VBA has just completed its interface inventory. All 

inventories are continually maintained and updated. 

VHA has a comprehensive plan to complete inventories and assessments of all 

system products by January 1998. VHA has inventoried its mission critical 

systems and will refine its Year 2000 plans and analyses as the assessment phase 

progresses. The impact of Year 2000 issues on the delivery of health care to 

veterans will be completely analyzed once these assessments are done, and VHA 

will finish renovation activities well in advance of any projected fail dates for its 

systems or equipment. 

To support its critical mission to provide quality health care to our nation's 

veterans, VHA has implemented a diverse array of information systems and 

computer-controlled equipment throughout its national system of health care 

networks. The VHA Year 2000 Compliance Plan indicates January 1998 as the 

completion date for assessing its total systems and equipment inventory and for 

developing the approach to achieve Year 2000 compliance. VHA has completed an 

inventory of mission critical central systems (VISTA and Corporate Systems) and 

has made substantial progress in inventorying other system product categories 

while conducting an analysis of individual applications, systems, and equipment 

that may be at risk. System product categories include: the VISTA national 

application suite, locally developed software applications, VHA corporate systems, 

databases and data archives, commercial-off-the-shelf (COTS) software, computer 

and communications hardware, biomedical equipment, and facility-related 

systems and equipment. To date, the following progress has been achieved: 

1. The VISTA applications inventory has been completed. Year 2000 assessment 

of VISTA applications is ongoing and will be completed by January 1998. 

2. Health care facilities are compiling individual inventories ofJocally developed 

software applications. Guidance and tools will be provided to local facilities for 

assessing software applications in October 1997. 

3. The VHA Corporate Systems inventory was completed in 1996 and is being 

assessed for Year 2000 compliance. Individual systems managers/owners are 

vested with the responsibility to assess and report on compliance status to 

VHA's Year 2000 Project Office. 

4. The COTS software inventory has been completed. Based on the data received 

from the 22 VISNs and their health care facilities, VHA is contacting COTS 

software vendors/manufacturers to determine compliance status and vendor 

plans. 

5. The COTS computer hardware inventory has been completed. VHA is making 

considerable progress in inventorying and analyzing Year 2000 compliance 

issues for its telecommunications systems inventory. 

6. A Biomedical Equipment plan within VHA's year 2000 Compliance Plan for 

Year 2000 compliance has been developed. To date, more than 120 major 

biomedical equipment manufacturers have been contacted. 

7. An inventory is being developed for achieving compliance in the area of 

facilities-related systems and equipment. VHA is participating in various 

subgroups within the Federal CIO Council Subcommittee on Year 2000 dealing 

with facilities, telecommunications and biomedical equipment. This will 

enable VHA to collaborate, share information, and benefit from the interagency 

Year 2000 work being coordinated by the General Services Administration, the 

Department of Health and. Human Services and other Federal agencies. 
90 

8. The inventory of Medical Research databases and archives is being conducted 

at each research facility. A thorough inventory will be completed by September 

1997. 

6. What are VA's contingency plans to ensure continuity of operations for 

its loan guaranty program? Is there a detailed, written plan in place for 

this program'? 

Risk Management and abatement is a key component ofVBA's Year 2000 

strategy. VBA has a well-thought-out plan for achieving Year 2000 compliance. 

VBA is being proactive in risk management to ensure VBA's plan executes 

correctly. The VBA Project Office is on top of all ofVBA's risks and potential risks, 

plus having an oversight team allows another set of "eyes and ears" to do likewise. 

VA will not have a situation where veterans will not get paid. Veterans will not 

lose their homes, or not get their checks, due to failure ofVBA systems to pay. 

VBA's Contingency Plan for the loan guaranty program consists of redundant 

development efforts to insure an operating payment application in the event that a 

redesign does not make its planned implementation date. The contingency plan 

for Loan Guaranty is in writing. 

7. What are VA's contingency plans to ensure continuity of operations for 

its vocational rehabilitation programs? Are there detailed, written plans 

in place for these programs? 

The Vocational Rehabilitation system was made Year 2000 compliant in late July 

1997. Therefore, a contingency for Vocational Rehabilitation is not needed. 

8. What are VA's contingency plans to ensure continuity of operations for 

its insurance system? Is there a detailed, written plan for this system? 

Risk management is the key to ensuring continuity of operations for Insurance. 

There is no detailed, written contingency plan for Insurance. To mitigate this risk, 

VA points to the fact 85 percent of the Insurance application modules have been 

made compliant, and the project is on schedule for completing renovation in 

February 1998. This allows ample time for testing prior to implementation before 

its December 1998 fail date. 

9. Mr. Catlett, you have indicated that the VA intends to primarily rely 

on its in-house personnel to achieve Year 2000 compliance, and that 

roughly 10 percent of the monies directed toward this effort will be set 

aside to pay private contractor and consultants. Yet VA has blamed VBA 

inventorying delays, for example, on the los8 of well-qualified employees 

to recent agency buyouts. Given this employment climate, and given that 

the time is constantly ticking on this issue, should the VA be relying so 

heavily on its own employees to get the job done? 

As mentioned in questions 4 and 5, VBA has met its inventory and assessment 

deadlines. With r egard to the VBA employment climate, if buy-outs are offered, 

personnel working key projects, such as Year 2000, will be excluded, ifthe site 

manager concurs. VBA feels it is optimizing the tslents of its employees, who have 

a vast amount of experience with VBA's legacy applications, by using them on 

VBA's Year 2000 project. VBA has a healthy mix of contractor support and 

government personnel working on this project. As of June 30, 1997,41 percent of 

VBA's applications were compliant. VBA has reached the 41 percent by the efforts 

of our talented government staff, and the prudent use of contractor rLSOurces. 

VHA's plan has invested the 22 VISNs with the responsibility of assuring 

compliance within each VISN. This is the most effective approach for both 
91 

business and management reasons. It makes managing such a large task more 

practical, with direct management responsibility locally situated. Each VISN 

office controls the business and financial planning and execution for its medical 

facilities. These managers will be making the repair, replace or upgrade decisions, 

and funding them. 

IRM staff at the medical facilities, which install and support VHA's nationally 

released applications, have a strong working relationship with the VHA 

programmers. VHA has maintained a strong system configuration management 

program over the years, which will facilitate implementing Year 2000 compliance. 

VHA may contract out some code renovation work; this contracting effort will be 

closely integrated into the existing VHA configuration management program. 

The VHA Year 2000 Project Office has contractor support on board, to provide 

additional management support and technical expertise. If needed, the VISN 

offices may also decide to enlist additional contractor support to acquire additional 

technical, analytical or project management expertise. 

10. The VA has estimated that it will cost $140 million over the next three 

years to achieve Year 2000 compliance at the VA, and that an unknown 

additional amount will be needed to deal with the a£·yet·to·be·assessed 

problem with biomedical devices. VA has also indicated that there will 

be no need for additional monies after FY 2000 because, in theory at least, 

itsjoh will be done. How realistic are these estimates, and what will the 

VA do if it later decides that these estimates were wrong? 

VA's estimates are realistic and will be updated as needed. VA's estimates reflect 

redirected funds and not "additional monies." As VA noted in our response to your 

prehearing questions, VA may incur additional costs to upgrade or replace COTS 

products in FY 1998 and FY 1999 as COTS providers notify Federal agencies of 

Year 2000 compliance of individual products. Funds will be redirected as 

necessary to ensure VA's information systems will provide uninterrupted support 

of benefits delivery and medical care. 

In the case of biomedical equipment, the original equipment manufacturer is the 

only party with all the information necessary to 1) determine whether or not there 

is a compliance issue and 2) recommend a course of action for non-compliant 

devices. VHA will determine the exact amount of money needed to correct any 

potential problems with medical devices when information from vendors is 

received. FDA is also taking the lead in dealing with medical device 

manufacturers. VHA is contacting vendors about the compliance status of their 

equipment and their remediation plans. 

Preliminary expert opinion indicates that only a small number of medical devices 

have Year 2000 problems. As soon as the number of products with Year 2000 

problems and corresponding solutions are identified, VHA will provide an updated 

Year 2000 cost estimate. Preliminary discussion indicates that equipment affected 

by the Year 2000 is considered to have a design flaw and the manufacturers are 

responsible to make the necessary updates rather than government agencies 

incurring these cost. 

11. Mr. Catlett, you indicated to Committee statf last week that VHA 

intended to have completed a survey of medical device manufacturers 

doing business with the VA during the first half of 1997, but that the 

survey responses proved inadequate and another questionnaire was 

expected to be sent out last Friday. Can you explain what happened with 

the initial survey, what steps you have taken to correct whatever 

problems arose, and when you expect to receive the responses and 

complete a thorough analyses of those responses? 
92 

VHA originally intended to use a centralized datab....e of medical devices at the 

Austin Automation Center. After further investigation, VHA found that this 

datab....e did not contain all required data for Year 2000 compliance purposes. It 

is this database, and not a survey, that was referred to. 

VHA has explored alternative methods to assess medical devices. VHA has 

identified vendors of medical devices and began mailing letters to vendors on 

June 20, 1997. Vendors are expected to assess the effects of Year 2000 on their 

medical devices and provide a written plan to VHA by August 18, 1997. While 

responses to date have been limited, those who have responded indicated that 

there would be no Year 2000 effect on the equipment, or that conversion work is in 

progress. VHA has made follow-up calls to those vendors who have not yet 

responded. 

VHA has formed a Medical Device Integrated Product Team to assure Year 2000 

compliance. This team includes biomedical engineers and experts from a variety 

of the medical specialties. This team will meet in August 1997 to validate VHA's 

biomedical approach and review the vendor responses. 

12. The VA has told us it is presently identifying and evaluating for Year 

2000 issues in biomedical systems. In addition to the survey of 

manufacturers, please explain how VA is going about such an evaluation. 

To assist with identifYing, inventorying, assessing, and evaluating these medical 

devices at risk with the millennium change, VHA has established a multidisciplinary oversight team to ensure that medical devices are compliant. The 

Medical Devices Integrated Product Team includes experts from the following 

fields: Radiology, Nuclear Medicine, Pathology & Laboratory, Medicine, 

Cardiology, Surgery, Biomedical Engineering, Acquisition & Materiel 

Management, Medical Research, Prosthetics, and VHA's Year 2000 Project Office. 

Specific activities of the team include: validating risk categories for medical 

devices and systems; setting priorities for assessing, renovating, testing and 

implementing; establishing schedules and timelines; reviewing vendor responses; 

and recommending actions to the VHA Year 2000 Project Office, VISN ClOs, and 

VA medical centers. 

13. During a pre-hearing briefing for Committee staff, VHA CIO David 

Albin80n and his staff appeared to downplay the importance of the 

medical device issue, and stated that there are only "four or five" medical 

devicell that would be impacted by the Year 2000 problem. What is the 

basis for this belief, and can you identify which four or five devices 

would be impacted by the Year 2000 problem? 

VHA's belief is that there are only four critical medical device categories that the 

Year 2000 problem would impact is based on information it received from officials 

at FDA. At the April 1997 federal CIO Council meeting, the department of Health 

and Human Services (HHS) volunteered to lead a subgroup of Federal 

Subcommittee on the Year 2000 to deal specifically with biomedical devices and 

other embedded technology. Gail Finch from HHS' Office ofInformation 

Resources Management chaired the first meeting on May 9, 1997, which included 

representatives from VA, OMB, National Institute on Health, FDA, DODlHealth 

Affairs, Navy, Army and the Nuclear Regnlatory Agency. 

Dr. Tom Shope, Deputy Director ofthe Division of Electronics and Computer 

Science at FDA, presented a description of the responsibilities under the Safe 

Medical Devices Act of both the FDA and equipment manufacturers. He indicated 

that there were seven to ten thousand manufacturers of approximately 80,000 
93 

devices regulated by FDA, although not all of those are computer controlled. In 

October 1996, FDA issued a Federal Register notice regarding quality systems 

that takes effect in July 1997 which enables FDA to regulate the manufacturing 

process as well as the product. 

Dr. Shope asserted that FDA's preliminary examination of devices identified four 

possible categories of devices that might be affected by the millennium change. 

Those medical device categories are: 

--Radiation therapy treatment planning systems for Cobalt units 

--EKG Automated Interpretation Programs 

--Pacemaker Automated programming systems and 

--External Defibrillators. 

Mr. Catlett, I forwarded to you a series of pre-hearing questions on the 

issue of Year 2000 compliance, and I appreciate the Department 

responding, to those questions. I am including a copy in the final hearing 

record. In follow-up to your responses, please answer the following 

questions: 

1. '!'he VA's written responses indicate that not all interfaces for VBA and 

VIlA related programs have been inventoried and assessed for Year 2000 

compliance. The Department states that 148 out of 429 VBA interface 

files have been assessed, and that 57 out of 148 are Year 2000 compliant, 

84 files are not compliant, and 7 files have been retired. In other words, 

the VA believes approximately 113 of its .inventoried files are Year 2000 

compliant. The Department also indicates that the VBA Interface 

Management Plan "is on target for completing the interface inventory by 

June 30,1997," or four days from now. Since the rest of the inventory 

process is so near completion, can you give us at least a broad thumbnail 

sketch of your VBA inventory expectations. Can we expect a similar 

ratio of compliant versus non-compliant files? 

VBA completed its interface inventory on-time. It is true that approximately 38 

percent of the VBA interfaces assessed thus far are already compliant (they 

contain no dates or the data structures are compliant). VBA projects that once the 

assessment of the entire interface inventory has been completed, the ratio of 

compliant vs. non-compliant interface file structures will have dropped to between 

25 and 30 percent. 

2. When did you send the Year 2000 compliance letter to corporate 

managers and owners seeking detailed information on interfaces? When 

do you expect to receive responses, and when will you complete an 

analysis of such information? 

An initial effort to update VHA's inventory of corporate or national 

systems/databases began in March 1996. One item of information requested at 

that time was a listing of data sources that feed each of these systems. VHA 

decided to verify the existing information and solicit additional information on outgoing interface data. The first VHA Corporate Systems Year 2000 compliance 

status request letters were sent to System Managers of Record (SMRs) of forty of 

VHA's Corporate Systems on June 2, 1997. Letters to the System Managers of 

Record of the remaining 129 VHA Corporate Systems were sent on July 21, 1997. 

These letters requested detailed information on interfaces between VHA Corporate 

Systems/databases and other systems, and plans for assuring that. the exchange of 

data is Year 2000 compliant. Initial responses are requested by the end of August 

1997. Any necessary follow-up responses will be received by October 1997. The 

assessment phase for all Corporate Systems is scheduled to be completed by 

January 1998. 
94 

3. When asked to outline the contincency plan. that are in place should 

certain eystems be non-compliant by the year 2000, the VA told me it. 

primary strategy was to make minion criticalsysteme compliant before 

the projected system faU dates. VA indicates that individual CIO'. are 

presently developine specific plans. When will such contingency plans be 

in place, and ian't it aettine a little late in the game to be just developing 

such plans? 

VBA's initial strategy to meet the Year 2000 issue was to replatform its 

applications. In essence, each m~or system would have been redesigned to 

operate in the new VBA environment. VBA has changed its primary means of 

resolving the Year 2000 dates to code conversion on its legacy systems, e.g., the 

compensation and pension system is being made compliant in its current 

environment with upgrades to Honeywell equipment. This will also apply to the 

Vocational Rehabilitation System and Education Systems. In some instances, like 

the Chapter 1606 Education Payment System, sufficient progress has been made 

with the VBA redesign effort that it proved to be the best option to pursue. 

Each effort is guided by a conversion plan with detailed tasks and milestones. The 

key component to successfu1 completion is risk management, which is occurring 

within each project as it moves from milestone to milestone. The following chart 

shows the conversion efforts by system as well as the development efforts and 

contingency plan for each application. 

M~or Primary 

SYStems ~ Contingency 

Education Ch. 1606 Redesign N/A - Scheduled Completion 

Date - November 1997 

Education Ch. 30 Code Conversion Redesign Following Chapter 

1606 Redesign 

C&P Code Conversion VETSNETC&P 

VR&C Code Conversion N/A - System Completed as of 

July 1997 

LGY Replatform and Development of Four 

Code Conversion Replacement Systems 

INS Code Conversion N/A - Scheduled Completion 

February 1998 

Each VHA health care facility has a contingency plan for maintaining health care 

operations. These contingency plans would be operative .in the event of a Year 

2000 failure , . Additional contingency planning will be developed for all systems 

based on projected Year 2000 failures. 

Each VHA VlSN CIO has the responsibility for ensuring that their systems are 

Year 2000 compliant, and that fall-back. plans exist if systems fail. Risk 

management and contingency planning are continuous processes. The Year 2000 

is one aspect of many kinds of possible failures. The management of risk is 

conducted on a continuous basis, and contingency plans change based on the 

events that occur. Contingency plans will continue to be updated through the 

Year 2000. 

4. Mr. Catlett, the VHA has indicated to me that line8-of-code are not a 

useful measure to determine projected costs for achievin. Year 2000 

compliance. because VHA'. medical care operations are written in what 

is known as "MUMPS" proarammina language. Industry espert. have 

advised my stall however, that no specific tools presently exist to convert 

the "MUMPS" proaramming Janauaae to a Year 2000 compliant format. If 
95 

this is true, and,-iI there are no such conversion tools available, how will 

the VA be able to convert this language, and how will the VA be able to 

estimate how much it will cost? 

VHA has acquired a commercial tool to assist in the identification of date related 

fields in its MUMPS applications. Using the tool, all 141 applications within the 

VISTA system will be assessed by January 1998 for Year 2000 date compliance 

issues. Once the assessment is complete, VHA will be able to refine its estimate of 

programming resources required to renovate any applications and achieve Year 

2000 compliance for the VISTA applications. In-house programming resources 

and contract programmers will be used for analysis and renovation. 

As VA noted in our previous response to your prehearing questions, ANSI 

(American National Standards Institute) MUMPS or M language standards are 

Year 2000 compliant. There is no need to "convert" the MUMPS language. VHA's 

standardized usage of a three digit year format provides assurance that VHA's 

applications that are detected as noncompliant can be quickly renovated and 

implemented without adverse impact on our veteran population. VHA is 

investigating interfaces and dependencies VHA applications have on their 

environment and will be taking steps to ensure they· continue to operate correctly 

by monitoring their integration with VHA's information systems. 

5. The VA has indicated that it does not believe cost-per-line-of-code is 

the most effective method of determining the expected cost of Year 2000 

compliance, and that the best way to assess the cost is to inventory and 

aSBeSS individual applications. What is the status of your cost assessment 

efforts, what is the basis for your view that your method is the best 

method to access the costs, and has there been any independent 

verification that your cost assessment methods are preferred? 

Our cost estimates represent both actual expenditures and future estimates. Our 

cost estimates rely on several factors to determine the complexity and cost for 

conversion for each non-compliant application. These factors include: number of 

modules, platform, languages, databases, and online v.ersus batch applications. 

Line-of-code estimates provided a very basic thumbnail estimate for potential Year 

2000 cost during the initial awareness phase for Year 2000. If you used the 

common industry figure of $1.50 for each line-of-code, VA's cost would be 

misrepresented as being $26 mil/ion dollars. Lines-of-code estimates do not 

provide an accurate measure as to the complexity or amount of actual code 

conversion that is needed. There are additional Year 2000 costs that would not be 

captured by relying solely on lines·of-code costs. Additional costs could include 

costs to upgrade hardware components (mainframes) and operating systems and 

costs for procuring Year 2000 compliant COTS products. Our $144 million dollar 

Year 2000 estimates includes these types of costs. 

Although lines-of-code is a useful measure in specific situations such as when a 

specific application has been contracted out for code conversion, VA's Year 2000 

cost estimates are more accurate than solely relying on lines-of-code for cost 

estimations. 

Our methodology is supported by the "best practices" from the CIO Council 

Subcommittee on Year 2000 and the experiences shared by other agencies, 

including the Social Security Administration. In addition, VA's method for 

developing cost estimates has been verified by VA's actual Year 2000 work 

performed by the Austin Automation Center (AAC) and VBA's Year 2000 efforts as 

well as actual Year 2000 work on VA's financial and personnel syst ems. The 

validity of this methodology has been verified by the completion ofthe actual 
96 

renovation of applications. As of June 30, 1997, the AAC has renovated 74 percent 

ofits applications and VBA has renovated 41 percent. 

Our cost estimates are reevaluated on a monthly basis and were independently 

verified during VA's Year 2000 Readiness Review. A copy of this review was 

previously provided to the Committee. VA will continue to refine our cost 

estimates and report any changes in our quarterly reports to OMB. 

6. Is it fair to state that at this point, VA is only able to provide us with a 

broad estimate of the expected cost of achieving Year 2000 compliance? 

What is the status of your efforts to determine the complexity and cost of 

conversion? . 

Our cost estimates are based on specific categories of Year 2000 cost described in 

our response to Question 5. These estimates represent actual expenditures and 

projected future costs based on VA's Year 2000 schedule as noted in our response 

to Question 5. These estimates represent the Year 2000 costs for VBA, VHA, AAC 

and our financial and personnel systems. VHA 2000 cost estimates will be refined 

as the assessment phase progresses. VA noted in our previous response to your 

prehearing questions that cost may increase as we are notified by industry of the 

Year 2000 compliance of COTS products and biomedical equipment. 

VHA has a comprehensive plan to complete inventories and assessments of all 

system products by January 1998 and perform the required Year 2000 impact 

analyses. VHA will refine its Year 2000 plans and analyses as the assessment 

phase progresses. The potential impact of Year 2000 issues on veterans from the 

perspective of health care delivery will be more clearly understood once these 

assessments are completed. VHA will complete renovation activities in advance 

of any projected faif dates for its systems or equipment. 

10 
97 

(::4 DEPARTMENT OF HEALTH & HUMAN SERVICES 

AUG 141997 

The Honorable Lane Evans 

Ranking Minority Member 

Committee on veterans' Affairs 

House of Representatives 

Washington, D.C. 20515-6335 

Dear Mr. EVans: 

Public Health Service 

Food end Orug Admrntstratton 

Rockville MD 20857 

This is in response to your July 10, 1997 letter regarding 

follow-up questions to the June 26, 1997 Subcommittee on Oversight and Investigations Hearing on "Year 2000 Issues and 

Their Impact on the Department of veterans' Affairs." The 

following are responses to your questions. 

1. Dr. Shope, the rDA has beeD tagged as the lead federal 

ageDoy responsible for eDsuring that there is not a severe probl .. with nOD-Year 2000 compliaDt medical devices. CaD 

you cutline to the Subcommittee the .tep. your agency has 

taken to .eet it. respoD.ibilitie. in this area? 

The Food and Drug Administration (FDA or the Agency) is 

responsible for protecting public health by helping to ensure that medical devices are safe and effective for their intended uses. The primary responsibility for the regulation of medical 

devices is vested in FDA's Center for Devices and Radiological 

Health (CDRH). Medical devices that have the potential for 

Year 2000 (Y2K) problems fall within the scope of this 

requlatory authority. Any computer software that meets the 

statutory definition of a medical device is subject to applicable FDA medical device regulations. Beginning 

January 1, 2000, computer systems and software applications 

used currently in medical devices may experience problems if 

they use two-digit fields for date representation. 

In early 1996, staff in CDRH began discussions within the 

Center to assess the type of computerized medical devices which 

could have functional problems related to the Y2K problem, or "Y2K non-compliance," that could affect device safety or effectiveness and impact patient safety. This assessment, 

which encompassed all types of medical devices, included 

participation of technical staff from each of the divisions 

within the Office of Device EValuation under CDRH. The 

discussions were preceded by presentations on the nature of the 

Y2K problem. These discussions, which continued into late 

1996, revealed only a few types of devices for which 

significant impact on patient safety due to Y2K non-compliance 

might be expected. 

In early July 1997, FDA sent a letter to device manufacturers to remind them of the Y2K issue and to advise them of actions 

that should be taken with regard to assessing any potential 

risks which could result from Y2K non-compliance. This letter was mailed to over 13,000 medical device manufacturers and 

others. In this letter, FDA reminded medical device 

manufacturers of their responsibilities to assure that products 

function as intended in accordance with their specifications. 

Failure to do so on the part of the manufacturer could result 

in a determination that products are misbranded or adulterated, 

with resulting consequences for the manufacturer. 

FDA is participating, along with ·representatives of other 

Federal agencies, including the veterans Administration (VA), 

in the Chief Information Officer (CIO) Council Subcommittee on the Year 2000. This Subcommittee is exploring ways to 
Page 2 - The Honorable Lane Evans 

facilitate information transfer from manufacturers to purchasers and users regarding the Y2K status of specific 

devices and scientific equipment. 

2. Wbat role will the FDA play to ensure that the veterans Bealth Administration (VBA) is abla to properly a44ra.s 

tha potential Year 2000 problem. with ragar4 to .e4ical 

4evica.? Bow .uch interaction 40e. tha FDA expeot to have 

4irectly with tha VA? 

FDA's role is to assure that medical devices, including those 

used by VHA, are safe and effective and manufactured in accordance with their specifications~ FDA, in its July letter, 

reminded manufacturers that to ensure the continued safety and 

effectiveness of these devices, manufacturers should ensure that their medical devices can perform date recording and 

computations that will be unaffected by the Y2K date change. 

Should the VHA request specific consultation or assistance, FDA will provide whatever assistance can be made available. VHA 

and FDA both participate on the CIO COuncil Subcommittee on the 

Year 2000 which provides a forum for interaction between VHA 

and FDA staffs. 

3. What in~ormation an4 input hava you raceive4 to 4ata ~rom 

private in4u.try an4 •• 4ical 4av1ce .anu~.cturers 

concerning tha 4egree to which thair 4.vices are Year 2000 

compliant? What .n~oraamant authority 40 you have to ansure that the.e .anu~acturer. evantually co.a into 

compliance? 

CORH staff have made inquiries of industry regarding the 

possible Y2K impact on a number of devices. with possible 

patient risk implications. To date, CDRH has learned of no significant problems anticipated by industry which cannot be 

addressed before the year 2000. While there have been some devices identified as having a potential to be affected by the 

Y2K problem, these are relatively few in number. The industry 

contacts, with whom this issue has been discussed informally, 

have not expressed concern that industry will be unable to address any date-related problems with these products before 

the prohlem could interfere with the device's functioning. 

All manufacturers of medical devices under the current Quality 

System Regulation (effective June 1, 1997) and its predecessor, 

the Good Manufacturing Practices regulations, must investigate 

and correct problems with medical devices. These problems 

include devices that fail to operate according to their 

specifications because of inaccurate date recording and/or 

calculations. These regulations, which apply to all medical 

devices not expressly exempted, would apply to devices with the 

potential to be affected by the Y2K problem. 

A device with a Y2K problem could be considered to be 

adulterated or misbranded under several provisions of the 

Federal Food, Drug, and cosmetic (FDC) Act (e.g., 

section 50I(h), if not designed and manufactUred in accordance 

with the Quality System Regulation (GMP); Section 502(f) (1), 

unless its labeling bears adequate directions for use; or section 502(j), if it presents a danger to health). 

Adulterated or misbranded devices are subject to seizure, and 

responsible parties are subject to injunction, civil penalties, or criminal prosecution, if they fail to bring their devices 

and operations into compliance with the FDC Act. 

The July FDA letter puts all device manufacturers on notice 

that they should assess the Y2K status of their devices. If 

the manufacturer confirms a Y2K problem, the Quality System 

Regulation requires the manufacturer to determine what action 
99 

Page 3 - The Honorable Lane Evans 

is needed to correct the problem and to prevent its recurrence. The manufacturer should take voluntary action to notify users and correct the problem through a safety alert or recall. The 

recently issued Reports of Corrections and Removals regulation 

(21 CFR 806), which becomes effective on November 17, 1997, 

requires manufacturers to notify FDA of such voluntary action. 

If the health risk associated with the Y2K problem is serious 

enough or sufficiently likely to occur, FDA may take action 

under Section 518 of the FDC Act to require notification of 

appropriate persons, including device users, to require recall 

of the device, or to take other remedial action. 

4. Can you explain in lay tera. the potential implications 

.hould .edical devica. be non-Year 2000 compliant? What 

ri.ks are as.ociated with non-Year 2000 compliant medical 

devices? To what extent could data collected through the u.e of the.e device. be corrupted or rendered u.ele •• becau.e of non-Year 2000 compliant .edical device.? Could 

this affect the treatment pre.cribed by VA doctor.? 

The impact of a medical device being Y2K non-compliant means that the device softWare will not properly process information 

related to dates. This could impact either recording and 

recordkeeping functions or calculations and data manipulations 

involving date information. 

As very few devices are dependent on calculations using date 

information for proper functioning, the impact for those 

devices that are non-compliant will be in date recording or recordkeeping functions. There might be products, due to their 

designs, which simply will not function due to problems related to the incorrect date, thus denying the health care facility 

their use until they are reset or reprogrammed. No specific 

examples of this type of problem are known currently to FDA. 

If the Y2K non-compliance is. associated only with date 

recording or recordkeeping, one of two effects may be 

anticipated. Either the date will be recorded incorrectly, most likely as ·00" for the year, or the device will not function due to error detected by the software. In this type 

of device, the problem very likely can be remedied easily by a software upgrade, a frequent occurrence for computer-controlled 

products. If the year of the current date is recorded as "00" 

and the device functions, there is not likely to be confusion 

due to such "recordkeeping" as there were no computer-generated 

records in 1900 with which there might be confusion. A date 

with the year recorded as "00· could interfere with data 

manipulation processes or perhaps storage of patient birth 

dates. It is the responsibility of manufacturers to upgrade 

such software. 

For products which use the date in a calculation or other 

algorithm, and for which the date information must be correct for correct function, there is a possibility that Y2K 

non-compliance could result in a risk of inappropriate 

diagnosis or treatment. A radiation treatment planning system 

is often given as an example of this type of product. 

Incorrect date information could lead to an incorrect treatment plan and, if not detected, could lead to incorrect radiation treatment with consequent risk to the patient. Again, 

manufacturers have a responsibility to investigate and correct such problems. 
100 

Page 4 - The Honorable Lane Evans 

5. Dr. Shop., your t •• timony ln41cate. that you have only 

ju.t baqun to .urv.y aanutacturer. ot ae4ical 4.vice., tor Y.ar 2000 coapllanc., an4 that the only r.llabl •• ourc. ot intoraation on the petential iapaot ot non-co.p1iant 

4.vice. i. the aanutacturinq in4u.try. At the .... tiae, 

hcw.v.r, ycu .tat. that you 40 not b.1iev. there will be 

any .. jor iapact on ae4ica1 4.vice .atety. Wby ha. the 

PDA just bequn lts review proces., an4 what ls the basi. tor your .e .. inq1y pr .. ature conclu.ion that you 40 not .ee any aajor 1.pact on .atety? 

FDA believes that there will not be a major impact on a large number of devices. Discussions with manufacturers have 

reinforced our assessment that this will not be a significant 

problem for medical devices and device users. FDA does not have plans to survey manufacturers formally. This is not to say that there will not be some devices which may be affected. 

We think that corrections for such devices are not difficult to implement and that there is adequate time for manufacturers to implement any solutions required. 

The July FDA letter reminds manufacturers that some computer 

systems and software applications used currently in medical 

devices may experience problems beginning January 1, 2000, due to their two-digit fields for date representation. The letter 

also reminds manufacturers that, pursuant to manufacturing 

regulations, they must investigate and correct devices that 

fail to operate according' to their specifications because of 

inaccurate date recording and/or calculations. 

FDA regulations require that manufacturers notify FDA if they 

learn that their devices have caused or contributed to a death or serious 1nJury. For currently manufactured medical devices, 

FDA recommended, in the July letter, that manufacturers should 

conduct hazard and safety analyses to determine whether device 

performance could be affected by the Y2K date change. For 

future medical device premarket submissions, for devices whose 

safe operation could be affected by the Y2K date change, FDA 

will review the submissions to ensure the manufacturer has 

demonstrated that the products can perform date recording and 

computations properly (i . e., Y2K compliant). 

5. Your testimony stat.s that "alaost none of these .e4ica1 

4e.lce. require knovle4qe of the current 4ate to operate 

safely an4 eff.ctiv.1y," an4 that paceaaker. present no threat b.caus. they "40 not u.e the current 4ate in th.ir 

operation." I. that the en4 of the inquiry concerninq the 

po •• ible threat. pre.ente4 by non-Ye.r 2000 compliant 

paceaakers, or 40es your Aqency inten4 to qive that 

question a closer look? 

We do not expect that there will be Y2K non-compliant 

pacemakers, although there may be auxiliary or accessory 

equipment used with pacemakers which could be impacted by the 

Y2K problem. We expect that, as a result of our letter to manufacturers, FDA's inspectional program, and device 

regulations, FDA will learn of any problems which may exist and 

which could present a risk to patients, as well as the steps 

which the manufacturer will take to correct such a problem. 

Manufacturers have been requested by FDA to conduct hazard and 

safety analyses to determine whether device performance is 

affected. Manufacturers, pursuant to manufacturing 

requlations, must investigate and correct devices that fail to operate according to their specifications because of inaccurate 

date recording and/or calculations. section 518 of the FCC Act 

requires notification of users or purchasers, as well as other 
101 

Page 5 - The Honorable Lane Evans 

actions, when a device presents an unreasonable risk of 

substantial harm to public health. 

7. can you .pecifically identify which .edical device. you 

pre.ently believe require knowledge of the current date to operate .afely and effectively? 

FDA currently does not have a list of all of the devices which 

may require knowledge of the current date to function as desi gned. The data FDA has reviewed to date in clearing 

devices for market would not necessarily reveal whether the device was Y2K compliant. For new devices, as stated above, 

FDA will review submissions to ensure the submitter has 

demonstrated that the products can perform date recording and 

computations that will be unaffected by the Y2K date change. 

Manufacturers have this information, and this is the reason why 

the July FDA letter was sent to manufacturers to remind them of 

their responsibility under the regulations to assess the impact 

of the date change on the operation of their devices. 

There is a difference in functioning as designed and 

functioning safely and effectively. Some problems which may 

develop due to the Y2K non-compliance of a device will not affect safety or effectiveness directly but possibly will have an impact on recordkeeping or date recording functions which, if not corrected, could lead to inconvenience, but not risk, to patients. 

The types of devices which require knowledge of the current date are any device which employs an algorithm which does a calculation involving a comparison of the current date with some other date-related data. Specific examples are radiation 

treatment planning systems for radiation treatments that use a radioactive isotope as the source of the radiation; or systems 

which determine a patient's age, for use in an algorithm 

requiring information on the patient's age, from input 

information on the patient's birthday and the current date. 

There are several categories of this type of device, such as electrocardiogram (ECG) interpretation programs or devices 

which provide diagnostic information based on various 

parameters, including the age of the patient, which are provided as input to the device. FDA does not anticipate that 

there are very many of these types of devices which will be Y2K 

non-compliant as a result of the use of two-digit 

representation of the year in dates. Those that do exist are not expected to present significant difficulties to correction 

by their manufacturers. 

B. Your testimony indicates that you believe the Year 2000 

risk will be mitigated through proactively working with 

manufacturers. Can you explain to the Subcommittee what 

exactly you mean by this? Kave you put toqetber a detailed plan to work with manufacturers to address this 

problem? 

By proactively working with the manufacturers, we mean that 

FDA, through discussions and the July letter, has reminded 

manufacturers of their responsibility to address this issue and 

of their regulatory responsibility to investigate and correct problems with medical devices which present a significant risk to public health. The July FDA letter was mailed to 13,407 

medical device manufacturers, 8,322 domestic manufacturers, and 

5,085 foreign manufacturers. The letter reminded manufacturers 

of their responsibility under current device regulations and 

made recommendations concerning future medical device 

pre-market submissions, currently manufactured medical devices 

and computer-controlled design, production, and quality control 

processes used by device manufacturers. 
102 

Page 6 - The Honorable Lane Evans 

FDA will respond as needed to any issues or questions presented to us by industry or the device user community. In addition, 

in the July letter, FDA reminded medical device manufacturers 

that CDRH's Division of Small Manufacturers Assistance is 

available to provide guidance regarding specific questions 

about Y2K compliance. FDA will continue to monitor this issue 

and will work with the Subcommittee to assure that medical 

device performance will not be affected by the Y2K date change. 

9. In your estimation, how long would it take for a manufacturer to adapt its product .0 that it i. Y.ar 2000 

compliant? I. there time enough to correct the.. probl ... prior to the year 2000? 

The length of time which will be required to adapt or modify a software-controlled device to be Y2K compliant will be highly 

variable and dependent on the type of device and its design characteristics. The pace of technological innovation in 

medical devices is so rapid, and software-controlled devices are so amenable to revision in many cases, that we expect that 

there will be more than adequate time for manufacturers to develop, implement, verify, and distribute any necessary 

corrections. 

10. Do you believe the VA is on track to achieve oompliance 

among its medical device manufacturers? What i. the ba.i. 

for your a •• e.sment? 

FDA is unable to answer this question in any detail as we do not have knowledge of specific activities which the VA is 

undertaking. FDA is responsible for protecting public health 

by ensuring that medical devices are safe and effective for 

their intended uses. FDA has reminded manufacturers that its 

device regulations could require that manufacturers of devices 

that fail to operate according to their specifications because 

of inaccurate date recording and/or calculations take certain 

actions. 

The VA is no different than the rest of the health care community in that it uses the same suppliers of medical devices as the rest of the community. To the extent that industry is not expected to have significant problems, the VA similarly 

should not need to take specific actions with regard to assuring that their suppliers of devices develop solutions to any Y2K-related date problems. The VA will have to learn from 

its suppliers which devices will be affected and how the 

manufacturers intend to address corrections. The activities of 

the working group under the CIO Council, Subcommittee on the 

Year 2000, of which FDA is a member, should assist in providing 

the VA with this information. 

We hope this information is helpful. If we may be of any further assistance, please let us know. 

Since~ely, 

Diane 

~F4~ E. Thomp~~. 

Associate Commissioner 

for Legislative Affairs 

o 

44-672 (108) 
ISBN 0-16-056138-8 

90000 

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