VETERANS’ HEALTH 

CARE

Oversight of Tissue Product 

Safety

Statement of Marcia Crosse 

Director, Health Care

Testimony 

Before the Subcommittee on Oversight 

and Investigations, Committee on 

Veterans’ Affairs, House of 

Representatives

For Release on Delivery 

Expected at 10:00 a.m. EDT

Wednesday, April 2, 2014

GAO-14-463T

United States Government Accountability Office
United States Government Accountability Office

Highlights of GAO-14-463T, a testimony 

before the Subcommittee on Oversight and 

Investigations, Committee on Veterans’ 

Affairs, House of Representatives

April 2, 2014

VETERANS’ HEALTH CARE

Oversight of Tissue Product Safety

Why GAO Did This Study

In fiscal year 2013, approximately 

59,000 tissue products were used to 

provide care to veterans at VAMCs; 

bone and skin grafts were the most 

common. While tissue products can 

repair the body and improve function 

and feeling, there is also the risk that 

communicable diseases can be 

transmitted from the donor to the 

recipients, potentially resulting in 

severe complications. FDA is 

responsible for regulating the 

manufacture of tissue products to help 

ensure the safety of such products 

marketed in the United States. For 

purchasing purposes, VHA considers 

tissue products to be a type of surgical 

implant and a prosthetic—items that 

support or replace a body part or 

function.

At recent hearings of this 

subcommittee, concerns were raised 

about VA’s oversight of surgical 

implant purchases and its ability to 

identify veterans who received an 

implant that is being recalled by the 

manufacturer or FDA. This testimony 

addresses (1) whether VHA received 

tissue products that may have been 

contaminated and (2) VHA’s 

safeguards to prevent the receipt and 

use of contaminated tissues, including 

VHA’s ability to ensure the quality of its 

vendors and to respond to recalls of 

tissue products. GAO reviewed FDA 

and VHA data on recalls and adverse 

reactions related to tissue products 

and VHA purchasing data. GAO also 

interviewed VA, VA OIG, and FDA 

officials on tissue product safety 

requirements and oversight actions. 

GAO focused on the policies and 

procedures at the VA and VHA level.

What GAO Found

Data from the Veteran’s Health Administration (VHA), within the Department of 

Veterans Affairs (VA), do not show evidence of VHA receiving contaminated 

tissue products, although, it is difficult to link adverse events in recipients to such 

products. VA’s National Center for Patient Safety (NCPS), which began operation 

in 1999, has not issued any patient safety alerts—mandates for action to address 

actual or potential threats to life or health—or advisories—guidance to address 

issues such as equipment design and product failure—related to tissue products 

potentially received by VA medical centers (VAMC) in the last 10 years. NCPS 

issues patient safety alerts and advisories for recalls that require specific clinical 

actions to ensure patient safety. Since NCPS began issuing and recording data 

on recalls in November 2008, NCPS has notified VAMCs of 13 recalls for tissue 

products from vendors from which VHA could have received affected products—

none of these recalls have resulted in patient safety alerts or advisories. For 6 of 

the recalls, 27 VAMCs reported to NCPS that they had identified and removed 

the recalled products from their inventories. For the other 7 recalls, none of the 

VAMCs had the affected tissue products in their inventories. The13 recalls were 

not issued for known tissue product contamination. Instead, most were initiated 

because of the possibility of contamination, such as compromise of product 

sterility and incomplete donor records. Further, VHA officials told us that their 

analysis of VHA data found no evidence of reported adverse events among VHA 

patients that were caused by contaminated tissue products. According to officials 

from the Food and Drug Administration (FDA), post-surgical infections often 

occur, even in the absence of tissue use, and it is often not possible to 

definitively attribute such infections to a tissue product.

VHA’s identification of recalled tissue products may be limited, although recent 

actions by the agency may help. VA and VHA rely on FDA to ensure the quality 

of tissue vendors—who are generally required to register with FDA—but VA and 

VHA policies do not require that a vendor’s FDA registration status be checked 

for most purchases. In addition, VHA’s ability to track recalled tissue products in 

its inventories may be limited by poor inventory management practices. After 

receiving a recall notice, VAMCs are required to search their inventories for 

recalled products; however, GAO and VA Office of Inspector General (OIG) have 

previously reported concerns with the completeness and accuracy of VHA’s 

inventory data and have made recommendations to improve VHA’s ability to 

accurately identify all recalled products in VAMCs inventories. VA is in the 

process of responding to these recommendations. Further, while VAMCs are 

responsible for checking for and accurately identifying all implanted, applied, or 

injected tissue products subject to a recall, GAO found that VA and VHA conduct 

no oversight to ensure this is done and rely on VAMCs, which may have limited 

ability to conduct this check. For example, VHA officials stated that it is difficult to 

search for information on implanted tissue products, in part, because there is no 

automated search capability. VA is taking steps that may enhance its ability to 

identify tissue products after they have been used.

VA and FDA reviewed facts GAO developed in preparing this testimony. VA and 

FDA provided technical comments, which were incorporated as appropriate.

View GAO-14-463T. For more information, 

contact Marcia Crosse at (202) 512-7114 or 

CrosseM@gao.gov.
 

Page 1 GAO-14-463T VHA Tissue Product Safety

Chairman Coffman, Ranking Member Kirkpatrick, and Members of the 

Subcommittee:

I am pleased to be here to discuss our work on the safety of tissue 

products used at the Veterans Health Administration (VHA), within the 

Department of Veterans Affairs (VA). Tissue products can be used to 

repair parts of the body, improve function and feeling, and restore 

appearance. In fiscal year 2013, approximately 59,000 tissue products 

were used to provide care to veterans at VA medical centers (VAMC).1

Some of the more commonly used tissue products by VHA are bone and 

skin grafts.2

While tissue products provide valuable methods to sustain and improve 

quality of life, there are also risks that they can transmit communicable 

disease from the donor to the recipient, potentially resulting in severe 

complications.

Some tissue products, such as bone or tendon, may be 

permanently implanted into veterans in the operating room. Others, that 

are temporary in nature because they degrade over time or are absorbed 

into the body, may be applied or injected in outpatient clinics. These 

include skin grafts used in wound care and collagen injections.

3

VHA, which oversees all VAMCs, considers tissue products to be a type 

of surgical implant for purchasing purposes.

Transmissible pathogens can include viruses, bacteria, 

parasites, and fungi. The Food and Drug Administration (FDA), an agency 

within the Department of Health and Human Services, is responsible for 

regulating the manufacture of tissue products to help ensure that these 

products are safe and to prevent disease transmission.

4

 

1

For purposes of this testimony we refer to VAMCs to include the associated outpatient 

clinics.

VHA defines these as 

2

Other types of tissue products used by VHA include cartilage, collagen, connective 

tissues, heart valves, ocular tissues, and tendons. While tissue products can be derived 

from humans or animals, the majority of the tissue products used by VHA are derived from 

humans. Human tissue products that are derived from living or deceased donors are 

known as allografts. A patient’s own tissue can also be used for a surgical reconstruction 

procedure—these are known as autografts. Our work did not include a review of VHA’s 

use of autografts.

3

Some tissues may be more prone to communicable disease than others, depending on 

the tissue type and processing methods used to prepare them for implantation, 

application, or injection.

4

VHA codes tissue products as biological implants—a type of surgical implant—in its 

National Prosthetics Purchasing Database.
 

Page 2 GAO-14-463T VHA Tissue Product Safety

prosthetics, which include all items that support or replace a body part or 

function. At recent hearings before this subcommittee, concerns were 

raised about VA’s oversight of surgical implant purchases and the 

agency’s ability to identify veterans who received an implant that is being 

recalled by the manufacturer or FDA. My remarks today will address the 

following two areas: (1) whether VHA received tissue products that may 

have been contaminated and (2) VHA’s safeguards to prevent the receipt 

and use of contaminated tissue products, including VHA’s ability to 

ensure the quality of its vendors and to respond to recalls of tissue 

products.

My remarks today are based on information we collected through 

reviewing agency documents and interviews with VA, VHA, and FDA 

officials. Specifically, to examine evidence related to possible receipt of 

contaminated tissue products, we reviewed VHA’s analyses of purchasing 

data from its National Prosthetics Purchasing Database (NPPD) and 

NPPD data on tissue products used for treatment of veterans. We also 

reviewed VHA’s and FDA’s analyses of data on recalls and reported 

adverse events related to tissue products, including outcomes of these 

events. To determine the actions VHA takes to prevent the use of 

contaminated tissue products, we interviewed VA and VHA officials and 

reviewed documentation on VA’s processes and requirements related to 

tissue product safety. For example, we reviewed certain aspects of VHA’s 

oversight of and purchasing from tissue product vendors, such as 

whether VHA requires its vendors to have an active registration with FDA. 

We also reviewed VHA’s tracking of, and response to, manufacturer 

recalls of tissue products. In addition, we interviewed officials from the 

VA’s Office of Inspector General (OIG) regarding its related work on this 

topic. Our work focused on the policies and procedures at the VA and 

VHA level. Our work did not focus on VAMCs, though VAMCs may have 

their own policies and procedures, such as those related to purchasing 

and responding to recalls.

To assess the reliability of the data used to prepare this statement, we 

gathered information from VHA and FDA on their data collection methods, 

including controls used to help ensure the data recorded is accurate and 

complete. We recently reported that NPPD data has some 

inconsistencies and errors that are attributable to data entry errors and 
 

Page 3 GAO-14-463T VHA Tissue Product Safety

omissions.5 In our work for this statement, we also found data errors in 

NPPD data on VHA’s tissue product vendors, such as missing or 

incorrect values. These errors could affect the accuracy of VHA’s reports 

of its tissue product purchases made through contracts with vendors and

purchases made on the open market.6

We conducted this performance audit from January 2014 to April 2014 in 

accordance with generally accepted government auditing standards. 

Those standards require that we plan and perform the audit to obtain 

sufficient, appropriate evidence to provide a reasonable basis for our 

findings and conclusions based on our audit objectives. We believe that 

the evidence obtained provides a reasonable basis for our findings and 

conclusions based on our audit objectives.

However, NPPD data represent 

the best information available and are the data VHA relies on to 

determine the vendors it uses and to manage its purchasing. As a result, 

we found that these data were sufficiently reliable for our use in preparing 

this statement.

We shared the information we used to prepare this statement with VA and 

FDA. After reviewing this information, VA and FDA provided us with 

technical comments, which we incorporated as appropriate.

VHA operates one of the largest health care delivery systems in the 

United States, providing care to more than 6 million veterans annually. Its

health care system includes 151 VAMCs nationwide that offer a variety of 

outpatient and inpatient services, ranging from routine examinations to 

complex surgical procedures. VHA also provides outpatient care at more 

than 800 community-based outpatient clinics.

Like other health care providers, VHA relies on FDA to regulate the 

manufacture of tissue products to help ensure the safety of such products 

marketed in the United States. Depending upon whether the tissue 

 

5

GAO, VA Surgical Implants: Purchase Requirements Were Not Always Followed at 

Selected Medical Centers and Oversight Needs Improvement, GAO-14-146 (Washington, 

D.C.: Jan.13, 2014), 31.

6

VA negotiates national, regional, and local competitive contracts with vendors for all 

types of items—including tissue products. Items that are not purchased from these 

contracts are referred to as open-market purchases.

Background
 

Page 4 GAO-14-463T VHA Tissue Product Safety

product is derived from a human tissue or an animal tissue, different FDA 

regulations apply.

• Human tissue products: FDA generally regulates human tissue 

products under a regulation specific to human cells, tissues, and 

cellular and tissue-based products.7 Establishments that manufacture 

human tissue products must register annually with FDA and submit a 

list of each type of human tissue product manufactured.8 FDA 

regulations include requirements for human tissue establishments to 

screen and test potential tissue donors for relevant communicable 

disease agents and diseases, report certain adverse events involving 

a communicable disease, and follow current good tissue practice 

requirements.9 Some human tissue establishments may also 

manufacture products regulated as drugs, devices, or biological 

products that would be subject to additional regulatory requirements 

including premarket review, and the adverse event reporting 

requirements specific to those products.

10 FDA conducts inspections 

of foreign and domestic human tissue establishments to ensure they 

are in compliance with applicable regulations.11

 

7

21 C.F.R. pt. 1271. In this statement we refer to these regulations as FDA’s “human 

tissue regulations.” Under FDA regulations, the manufacture of human tissue includes the 

recovery, processing, storage, labeling, packaging, or distribution of human tissue, and 

the screening or testing of the tissue donor. 21 C.F.R. § 1271.3(e).

8

21 C.F.R. § 1271.21(a), (b). Establishments subject to these requirements include a 

place of business under one management, at one general physical location, that engages 

in the manufacture of human cells, tissues, and cellular and tissue-based products. 

21 C.F.R. § 1271.3(b).

9

Current good tissue practices are intended to ensure that tissue products do not contain 

communicable disease agents, are not contaminated, and do not become contaminated. 

They include requirements related to tissue storage and distribution, labeling, record 

keeping, and tracking tissue products from the donor to the consignee. 21 C.F.R. 

§ 1271.150.

1021 C.F.R. § 1271.1(b)(2).

11FDA conducts inspections of human tissue establishments based on available resources 

and uses certain risk-based priorities when determining which establishments to inspect. 

In fiscal years 2012 and 2013, FDA inspected 592 and 671 establishments regulated 

under its human tissue regulations, respectively. FDA officials stated that, due to data 

constraints, the agency could not determine if all establishments regulated under its 

human tissue regulations had an inspection. Human tissue establishments that are also 

regulated under FDA’s drug, device, or biologics regulations are subject to inspection 

requirements under those provisions. 21 C.F.R. § 1271.390.
 

Page 5 GAO-14-463T VHA Tissue Product Safety

• Animal tissue products: FDA generally regulates tissue products 

derived from animals under its medical device regulations.12 Similar to 

human tissue establishments, device establishments must register 

annually with FDA and submit a list of each product manufactured, 

report certain adverse events that may have been caused or affected 

by use of one of its devices, and follow current good manufacturing 

practice requirements.13 FDA inspects certain foreign and domestic 

device establishments to ensure they meet required manufacturing 

standards.14 Similar to human tissue products regulated as devices, 

animal products regulated as devices also must meet certain 

premarket review requirements.15

 

1221 C.F.R. pts. 800-898. Some tissue products derived from animals may be regulated 

as drugs or biological products. 21 C.F.R. pts. 200-499, 600-680.

13A device establishment is a place of business under one management at one general 

physical location at which a device is manufactured, assembled, or otherwise processed. 

21 C.F.R. § 807.3(c).

14FDA is required to inspect domestic establishments that manufacture devices that meet 

certain risk classifications every two years. 21 U.S.C. § 360(h). FDA is not required to 

inspect foreign establishments on a specific schedule.

15In general, unless exempt by regulation, new devices are subject to premarket review 

either through the premarket notification process, to determine whether a new device is 

substantially equivalent to another legally marketed device, or the more stringent 

premarket approval process, which requires the manufacturer to supply evidence 

providing reasonable assurance that the device is safe and effective. 21 U.S.C. §§ 360(k), 

360e. On January 23, 2014, FDA issued draft guidance related specifically to medical 

devices containing materials derived from animal sources. FDA stated that although the 

use of animal derived-material in medical devices is well established, animal materials

may carry a risk of transmitting communicable disease when improperly collected, stored, 

or manufactured. The draft guidance describes the information that should be documented 

at the manufacturing facility and included in any premarket submissions to FDA. 
 

Page 6 GAO-14-463T VHA Tissue Product Safety

While there have been thousands of tissue products used at VAMCs, 

VHA data do not show evidence of VHA receiving contaminated tissue 

products. However, it is difficult to attribute adverse events to tissue 

product contamination. VA’s National Center for Patient Safety (NCPS) 

issues patient safety alerts, patient safety advisories, and recalls to notify 

VAMCs of possible receipt of unsafe or defective medical products, 

including tissue products. NCPS, which began operation in 1999, has not 

issued any patient safety alerts—mandates for action to address actual or 

potential threats to life or health—or advisories—guidance to address 

issues such as equipment design and product failure—related to tissue 

products in the last 10 years, according to NCPS officials.

16 NCPS issues 

patient safety alerts or advisories for recalls that require specific clinical 

actions to ensure patient safety. Since NCPS began issuing and 

recording data on recalls in November 2008, it has notified VAMCs of 13 

recalls through September 2013 for tissue products from vendors from 

which VHA could have received the affected products—none of these 

recalls have resulted in patient safety alerts or advisories.

17

 

16Patient safety alerts or advisories are classified as such based on the severity and 

frequency of the incident.

Each of these 

recalls could represent the recall of just one product, multiple products, or 

all products processed within a specific date range from a particular 

vendor. After NCPS issues recalls, it receives reports from VAMCs on 

whether recalled products were identified in their inventories—VAMCs do 

not report to NCPS if any products were used. Of the 13 recalls, 6 

resulted in 27 VAMCs reporting back to NCPS that they had identified 

and removed the recalled products from their inventories. For the other 7 

recalls, no VAMCs indicated that they had the affected products in their 

inventories. None of the 13 recalls were issued for known tissue product 

contamination. Instead, most were initiated because of the possibility of 

contamination for reasons such as compromise of product sterility, tissue 

recovered from donors with risk factors for communicable diseases, 

17NCPS identified recalls related to tissue products through September 30, 2013. The 

products included in these 13 recalls were obtained from 11 different vendors. NCPS 

issues recall notifications through VHA’s Alerts & Recalls intranet database to ensure that 

every applicable facility receives them and assigns facilities to review and take any 

designated actions, such as removing the product(s) from inventories. NCPS does not 

issue notices for all recalls. According to officials, reasons not to issue a recall notice 

include FDA reports that the recall is complete or terminated, the vendor reports that VHA 

did not receive the affected product(s), the product at the time of reporting is expired, or 

the product was not a remove-from-use (pull off the shelf) recall notification.

VHA Data Do Not 

Show Evidence of 

Contaminated Tissue 

Products, Although 

Attributing Adverse 

Events to Tissue 

Product 

Contamination Is 

Difficult
 

Page 7 GAO-14-463T VHA Tissue Product Safety

incomplete donor records, or manufacturers suspected to have deviated 

from FDA’s current good manufacturing practices.18

Further, VHA officials told us that their analysis of VHA data found no 

evidence of reported adverse events among VHA patients that were 

caused by contaminated tissue products. Specifically, NCPS officials 

stated that they searched the NCPS Patient Safety Information System 

database, commonly known as “SPOT,” which did not yield any evidence 

of proven adverse events being caused by tissue product contamination. 

SPOT contains root cause analysis reviews (investigations conducted by 

VAMCs to evaluate the system or process causes of reported adverse 

events) and patient safety incident reports (patient safety-related adverse 

events reported to NCPS).19

Nonetheless, it is also important to note that it is difficult to determine 

whether adverse events are caused by contaminated tissue products. 

FDA officials told us that it is often not possible to definitively attribute 

post-surgical infections to a tissue product, despite thorough 

investigations of reported adverse events. FDA noted that there may be 

multiple possible causes of an adverse event, given the several potential 

sources of infection (e.g., the patient, the clinical setting, or the medical 

product itself). FDA also pointed out that infections following surgical 

procedures often occur, even in the absence of tissue use. Adverse 

events specifically caused by contaminated tissue appear to be rare 

nationwide. Of the approximately 850 reported adverse events potentially 

related to human tissue products received by FDA between January 1, 

Collectively, NCPS officials stated that their 

search of SPOT encompassed nearly 1 million records over more than 

11 years.

 

18One of the 13 recalls was initiated for reasons other than potential contamination.

19All root cause analyses are required to be reported to NCPS. According to NCPS, each 

VAMC can submit patient safety incident reports to NCPS using a web-based form that is 

standardized across VAMCs. However, officials cautioned that they rely on personnel in 

the field to recognize an event as a patient safety-related adverse event and enter it into 

the system. Since it is a voluntary reporting system, NCPS officials said they would not 

feel comfortable stating that every adverse event that has happened in all VAMCs is 

represented in the database. In addition, the level of detail in each report is often not 

enough to say why an event happened. Besides submitting patient safety incident reports 

to NCPS, each VAMC maintains its own incident reporting system, which is used by 

VAMC staff to report information on adverse events. Our review did not include those 

adverse events maintained in the individual VAMC’s reporting systems.
 

Page 8 GAO-14-463T VHA Tissue Product Safety

2006, and June 30, 2013, FDA informed us of 2 cases where infection 

could reasonably be attributed to the tissue product.20

VA relies on FDA’s oversight of tissue vendors, but VA and VHA policies 

do not require that staff check tissue vendors’ FDA registration status for 

most purchases. VHA’s ability to track recalled tissue products may be 

limited by poor inventory management practices. We and VA OIG 

previously have reported similar concerns with VHA’s inventory 

management practices and have made recommendations to improve 

VHA’s ability to accurately identify all recalled products in VAMCs’ 

inventories. Although VAMCs are responsible for checking for all 

implanted, applied, or injected tissue products subject to a recall, VA and 

VHA have no oversight to ensure this is done. VAMCs’ ability to conduct 

this check may be limited, but VA has taken steps that may enhance its 

ability to identify tissue products after they have been used.

The VA and VHA policies we reviewed suggest that VA and VHA do not 

require staff to check tissue vendors’ FDA registration status for most 

types of purchases, despite VHA’s reliance on FDA’s oversight of tissue 

establishments to ensure the quality of the tissue products the agency 

receives. In addition, VA does not conduct additional oversight of its 

own.21

 

20The data included those products regulated solely under FDA’s human tissue 

regulations with the exception of cell therapy products or reproductive tissue products, 

which are tissue products not generally used by VHA. These data did not include tissue 

products that are also regulated under FDA’s drug, device, or biologics regulations and 

are, therefore, subject to those regulations’ adverse event reporting requirements.

Registration is important to ensure that tissue establishments are 

subject to proper federal oversight. This oversight includes, for example, 

FDA inspections to determine compliance with regulatory requirements 

pertaining to tissue product safety, such as testing and screening donors 

for communicable diseases. It is important to note that, according to

officials, VA’s vendors could include some distributors who are not 

required to register with FDA because they never take physical 

possession of tissue products. VHA has no policies requiring purchasing 

21We reviewed VA and VHA-wide policies; our review did not include any policies that 

may exist at the VAMC-level. For example, VAMCs may have established their own 

VAMC-specific purchasing policies.

VA Does Not Ensure 

Vendors are 

Registered with FDA; 

VHA’s Identification of

Recalled Tissue 

Products May Be 

Limited, Although 

Recent Actions May 

Help

VA Relies on FDA 

Oversight of Tissue 

Vendors but Does Not 

Ensure Its Vendors Are 

Registered with FDA
 

Page 9 GAO-14-463T VHA Tissue Product Safety

staff to check whether these distributors are supplying tissue products 

from registered tissue establishments. When discussing their purchasing 

requirements, VA and VHA officials told us that: 

• The majority—51 percent—of tissue product purchases were openmarket purchases below the Federal Acquisition Regulations (FAR) 

micro-purchase threshold of $3,000 in fiscal year 2013; pursuant to 

VHA’s purchasing processes, these purchases are made by local 

VAMC purchasing staff.22

• VHA likewise does not require VAMC purchasing staff and contracting 

officers to check FDA registration status of the tissue product vendor 

for open-market purchases over $3,000. Such purchases are rare—

just 6 percent of VHA’s fiscal year 2013 tissue product purchases 

were open-market purchases over $3,000.

VHA officials told us that the agency has no 

policies requiring VAMC purchasing staff to check whether tissue 

vendors are registered with the FDA when making these purchases.

• Finally, VHA can also purchase tissue products through national, 

regional, or local contracts, including national-committed use 

contracts and Federal Supply Schedule (FSS) contracts.23 Of VHA’s 

fiscal year 2013 tissue product purchases, 40 percent were FSS 

purchases below $3,000 and 2 percent were FSS purchases greater 

than $3,000.24

 

22The Federal Acquisition Regulations (FAR) are government wide regulations that 

establish uniform policies and procedures used by all executive branch federal agencies 

for their acquisitions. Purchases above $3,000 are completed through a contracting 

process that involves the VAMC purchasing staff and Networking Contract Office staff.

VA officials stated that before issuing an FSS contract 

they check vendors’ FDA registration status for medical devices and 

23These national level contracts are negotiated by VA’s National Acquisitions Center. 

However, VHA currently has no national committed-use contracts for biologic implants, 

although other surgical implants could be purchased through these contracts. National 

committed-use contracts typically establish a fixed price for several models of a certain 

type of surgical implant, which VHA must use throughout its healthcare system. Federal 

Supply Schedule (FSS) contracts are indefinite delivery and indefinite quantity contracts 

awarded to vendors for various types of surgical implants and include some biologic 

implants, such as skin grafts.

24According to VA officials, there are 9 vendors with FSS contracts that could supply 

tissue products to VA. In January 2014, we recommended that VA develop a plan for 

evaluating the benefits of developing more national contracts—such as FFS contracts—

with vendors of surgical implants, which could include vendors of tissue products. 

VA concurred with this recommendation and told us that it plans to develop a national 

contract procurement package for tissue products by the end of fiscal year 2014. See 

GAO-14-146, 26-27, 35.
 

Page 10 GAO-14-463T VHA Tissue Product Safety

drugs, which may include some tissue products. However, there is no 

policy requiring staff to check a vendor’s FDA registration status for 

other tissue products, such as those regulated under FDA’s human 

tissue regulations. Purchases under other contracts, such as regional 

or local contracts are rare—less than 1 percent of purchases in fiscal 

year 2013—and VHA has no requirements to check a vendor’s FDA 

registration status for these purchases.

However, VHA officials stated that these data may undercount the 

number of purchases made under a contract, because NPPD does not 

require staff to enter contract information when recording purchases in 

the database. For VHA’s tissue product purchases by purchase type see 

figure 1.

Figure 1: Veterans Health Administration (VHA) Tissue Product Purchases in Fiscal 

Year 2013

Note: According to VHA, these data may undercount the number of purchases made under a 

contract, because NPPD does not require staff to enter contract information when recording 

purchases in the database. This was the best data available from VHA at the time we did our work.

a

Federal Supply Schedule (FSS) contracts are national level contracts negotiated by the Department 

of Veterans Affairs National Acquisitions Center.
 

Page 11 GAO-14-463T VHA Tissue Product Safety

b

This includes all purchases under non-FSS contracts—both those above and below $3000.

In the event of a recall, NCPS informs VAMCs, which check their 

inventories for the recalled items; however, in the past we and VA OIG 

have reported concerns with VA’s inventory management practices.

25

However, VAMC inventory searches may be limited by poor inventory 

management practices. For example, in May 2011, we reported that VA 

may lack complete information about expendable medical supplies and 

reusable medical equipment in its inventories.

According to VHA policy, VAMCs must have a program for responding to 

recalls that includes identifying numbers and locations of tissue products 

at the VAMCs. To ensure products are removed, VAMCs are required to 

report the results of these inventory searches to NCPS—which manages 

recalls for VHA and documents recalled products found in VAMC 

inventories in VHA’s recall database.

26 In the event of a 

manufacturer recall or patient safety alert for such items, VAMCs may be 

unable to use their inventory management systems to systematically 

determine whether the affected items are in their facilities. Instead, they 

may need to resort to a physical search, which could miss items, creating 

the risk that recalled products could be used in patient care. This is 

consistent with findings of our previous work related to VAMCs’ poor 

inventory management practices. In our 2011 report, we recommended 

that VAMCs be required to enter information about all expendable 

medical supplies and reusable medical equipment into an appropriate 

inventory management system.

27

 

25NCPS learns of recalls from designated officials at the regional and local level; other 

federal agencies, including FDA and the Department of Defense; and tissue vendors. 

According to VHA Directive 2008-080, vendors are required to notify VHA of any recalls or 

important product safety issues. VHA is required to report to NCPS any problems 

identified by its subordinate chain that may necessitate a recall, such as voluntary recall 

notices received from tissue vendors and observed clinical problems with tissue products. 

VHA is also required to contact NCPS should it become aware of a recall or other product 

safety information from vendors.

 To address deficiencies we identified, 

VHA issued new requirements in 2011 for the management of medical 

supplies and equipment in VAMCs inventories. However, in 2013 we 

26GAO, VA Health Care: Weaknesses in Policies and Oversight Governing Medical 

Supplies and Equipment Pose Risks to Veterans' Safety, GAO-11-391 (Washington, D.C.: 

May 3, 2011).

27GAO-11-391, 19.

VHA’s Ability to Track 

Recalled Tissue Products 

May Be Limited by Poor 

Inventory Management

Practices
 

Page 12 GAO-14-463T VHA Tissue Product Safety

again reported that none of the VAMCs we reviewed had fully complied 

with all of VHA’s new requirements for managing inventories, and that 

VAMC inventories were still incomplete. We additionally recommended 

that VAMCs ensure that medical supplies and equipment are tracked in 

the appropriate inventory management system and VA concurred with our 

recommendation and described specific actions that it plans to take to 

improve VMACs’ compliance with VHA’s new requirements for managing 

inventories, such as providing training to VAMC staff.

28

Similarly, in March 2012, VA OIG reported concerns that VHA’s 

prosthetics inventory data—which includes tissue products—are 

incomplete and inaccurate.

If these 

recommendations are effectively implemented, it will help improve VA’s 

overall inventory management practices.

29 VA OIG officials reported that VAMCs 

should use an automated inventory system—the Prosthetics Inventory 

Package—to manage certain prosthetic inventories including tissue 

products.30

 

28GAO, Veterans Health Care: VHA Has Taken Steps to Address Deficiencies in Its 

Logistics Program, but Significant Concerns Remain, 

However, VA OIG told us that the few tissue products found at 

the VAMCs they inspected were tracked in inventory spreadsheets or 

logs, rather than through the Prosthetics Inventory Package. These 

informal tracking systems are maintained by clinical staff in the operating 

room and are therefore not standardized or shared across VAMCs. They 

are prone to error due to manual entry, thus making accurate 

identification of all recalled products and oversight of VAMCs’ actions 

more challenging. In addition, when conducting the work for this 

statement, VA officials told us that NCPS would not notify VAMCs of 

recalls in certain situations; for example, if FDA reports that the recalled 

product is expired at the time of reporting and thus should no longer be in 

VHA’s inventory. However, VA OIG also found that expired products often 

remain on VAMC’s inventory shelves, which suggests that they may 

retain expired products that have been recalled. VA OIG recommended 

that VAMCs be required to conduct comprehensive physical inventories 

GAO-13-336 (Washington, D.C.: 

Apr. 17, 2013), 7-8, 25.

29The VA OIG report reviewed VHA’s prosthetic inventory management practices. 

Department of Veterans Affairs, Office of the Inspector General, Office of Audits and 

Evaluations, Veterans Health Administration: Audit of Prosthetics Supply Inventory 

Management, 11-00312-127 (Washington, D.C.: Mar. 30, 2012).

30VA OIG 11-00312-127, 14.
 

Page 13 GAO-14-463T VHA Tissue Product Safety

of stocked prosthetics supplies and adjust the Prosthetics Inventory 

Package to match inventory quantities. It also recommended that the 

Prosthetics Inventory Package be replaced with a comprehensive modern 

inventory system and a mechanism be established to identify surgical 

device implants stored in VAMC inventories. VA concurred with these 

recommendations. According to VA OIG, VA completed its physical 

inventory in June 2012 and plans to have a comprehensive inventory 

system in place in March 2015. VHA’s development of a mechanism to 

identify surgical device implants in inventories is in process.31

Although NCPS tracks and responds to recalls, NCPS does not track 

warning letters, which notify vendors of violations found during 

inspections, including conditions that could lead to tissue contamination.32

VA officials stated that they do not track warning letters because they are 

intended to give vendors an opportunity to take voluntary corrective action 

before FDA initiates an enforcement action and do not necessarily 

provide information on specific tissue products. For example, in 2012, 

FDA issued a warning letter to a vendor used by VHA that outlined 

problematic inspection results including conditions that could result in 

accidental exposure of tissue products to communicable diseases. NCPS 

officials explained that they did not receive this FDA warning letter, and 

would not expect to, as there is no recall action indicated in these letters.

VAMCs are responsible for checking for and accurately identifying all 

tissue products subject to a recall that have been implanted, applied, or 

injected. However, VA and VHA conduct no oversight to ensure this is 

done. While we did not review policies and procedures that may exist at 

individual VAMCs, our work suggests that VAMCs’ ability to check for 

implanted, applied, or injected tissue products may be limited. NCPS 

officials told us that, unlike tissue products stored in VAMCs’ inventories, 

NCPS is not responsible for managing and documenting recalls of tissue 

products that have been used and does not require VAMCs to report back 

the results of their search for these tissue products. Rather, according to 

officials, each VAMC is responsible for ensuring it tracks the recalled 

products to individual patients. However, there is no oversight at the VA 

 

31VA OIG, 11-00312-127, 21-22.

32FDA issues warning letters for violations of regulatory significance that may lead to 

enforcement action if not promptly and adequately corrected.

Identification of Recalled 

Tissue Products Already 

Implanted, Applied, or 

Injected May Be Limited, 

but VA Is Taking Steps

That May Improve Its 

Ability to Identify Such 

Products
 

Page 14 GAO-14-463T VHA Tissue Product Safety

or VHA level to make certain that VAMCs are indeed conducting this 

check. In addition, VHA officials stated that it is difficult to search for this 

information. For example, although VAMC operating room staff have 

been required to include the serial and model numbers of the tissue 

products used in the surgical patient records since 2011, VHA officials 

told us that there is no way to automatically search these data. 

Consequently, according to VHA officials, VAMCs generally rely on tissue 

product vendors to provide information on the medical facilities that have 

received recalled tissue products and staff must check individual patients’ 

records to verify the vendor’s information. Further, the quality of the data 

on tissue products recorded in the surgical patient records—which is 

entered manually by clinical staff—has not been assessed. It also does 

not include information on tissue products used in outpatient settings, 

such as skin grafts—one of VA’s more commonly used tissue products. 

VHA’s National Prosthetics Purchasing Database—NPPD—contains the 

serial and model number of prosthetics used for individual patients, 

including tissue product implants; however, VHA officials told us that 

NPPD is not used to track patients with implants in the case of a recall, 

but is generally used for purchasing and accounting purposes. 

Additionally, we recently reported that NPPD data was often found to be 

incomplete or incorrect.

33

VA is taking steps that may enhance its ability to identify implanted, 

applied, or injected tissue products at VAMCs. VHA began developing a 

system, the Veterans Implant Tracking and Alert System (VITAS), in 

2008. VITAS provides a means to track and retrieve identifying 

information—including the serial and lot number—of surgical implants 

placed in patients, including tissue products. VITAS’s development was 

temporarily suspended due to data-reliability challenges stemming from 

inaccurate or missing entries in NPPD and interoperability challenges 

between VITAS and other VHA systems. However, VA officials told us 

that they plan to fund further development of VITAS in fiscal year 2014. In 

addition, VHA officials told us that they have established a working group 

to determine the feasibility of utilizing scanning and tracking technology to 

automatically upload tissue product implant information into electronic 

 

 

33We reported in January 2014 that the lot number and serial number of items used in 

patients is not always entered into NPPD by purchasing and procurement staff, as 

required. In addition, this information must be entered manually, which has the potential to 

cause inaccuracies in information that is entered into NPPD. GAO-14-146, 33.
 

Page 15 GAO-14-463T VHA Tissue Product Safety

patient medical records.34 Scanning a universal code on a tissue product 

can reduce errors in tracking implants; for example, those that occur 

when transcribing this information into patient records by hand. In 

addition, FDA issued a final rule on September 24, 2013, to establish a 

system to identify devices through distribution and use. The rule requires 

the label of medical devices to include a unique device identifier (UDI) in 

plain text and in a form that uses automatic identification and data capture 

technology, such as a bar code scanner. This rule applies to tissue 

products regulated under FDA’s medical device regulations, and could 

help with the identification of these products both before and after they 

have been used.

35

Chairman Coffman, Ranking Member Kirkpatrick, and Members of the 

Subcommittee, this completes my prepared statement. I would be 

pleased to respond to any questions that you may have.

If you or your staff have any questions about this testimony, please 

contact me at (202) 512-7114 or crossem@gao.gov. Contact points for 

our Offices of Congressional Relations and Public Affairs may be found 

on the last page of this statement. GAO staff who made key contributions 

to this statement include Geri Redican-Bigott, Assistant Director; 

Emily Binek; Deirdre Brown; Sandra George; and Cathleen Hamann.

 

34Officials also cited another recent change noting that as of January 24, 2014, this tissue 

implant data from the medical records can be captured in VHA’s Corporate Data 

Warehouse, which would allow these data to be extracted and searched at a national 

level. However, access to the data is permission-based, and while VHA officials said the 

data could be searched at a national level, there are currently no VHA policies in place for 

VHA or VAMC staff to search the database during a recall.

35This rule does not apply to products subject only to FDA’s human tissue regulations. 

These requirements will be phased in over a 7-year period; however, the labels and 

packages of implantable, life-supporting, and life-sustaining devices must bear a UDI 

within 2 years. 78 Fed. Reg. 58786 (Sept. 24, 2013).

GAO Contact and 

Staff 

Acknowledgments

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