VA Health Care: Processes to Evaluate, Implement, and Monitor Organizational Structure Changes Needed
Released: 2016-10-27T00:00:00

Letter

Background

VHA Organizational Structure

The Under Secretary for Health is the head of VHA and is supported by the Principal Deputy Under Secretary for Health, four Deputy Under Secretaries for Health (DUSH), and nine Assistant Deputy Under Secretaries for Health (ADUSH). Five of these senior leadership positions have been added since 2015. (See fig. 1.)

The four DUSH-level positions are

Operations and Management: This official oversees VHA’s field operations. All VISN directors report to the DUSH for Operations and Management; VISNs manage the day-to-day functions of VAMCs and outpatient facilities within their network. The Office of the DUSH for Operations and Management supports the VISNs by providing guidance and individual assistance to address operational challenges (such as personnel issues, adverse events at facilities, and implementation of legislation), and supporting the management of access to care (through the ADUSH for Access to Care position, added in 2016). The office also serves as the focal point for the flow of information and guidance between VHA central office and the VISNs and VAMCs.

Policy and Services: This official oversees VHA offices focused on health care policy, information management, and research. The Office of the DUSH for Policy and Services is responsible for developing and promulgating VHA policies, employing information and informatics tools to improve patient outcomes, and measuring results to ensure continuous learning.

Organizational Excellence: This official oversees program offices focused on assessing and improving quality and safety, providing VHA leadership with analytics to assess how VHA is performing as an organization, and addressing issues related to public trust and integrity. For example, the ADUSH for Integrity reports to the DUSH for Organizational Excellence and is responsible for the day-to-day management of offices focused on internal and external audits, compliance, and ethics. The Office of the DUSH for Organizational Excellence—created in 2015—serves as a hub to enable VHA to achieve the five priorities the Under Secretary of Health established in 2015, and to respond to our High Risk List designation.

Community Care: This official oversees all VHA community care programs and business processes, such as determining veterans’ eligibility to receive health care benefits and purchasing care from non-VA providers. The Office of the DUSH for Community Care was created in 2015 to implement provisions in the Choice Act that expanded veterans’ access to non-VA health care services and directed VHA to consolidate the administration of payment for care from non-VA providers. Prior to the creation of this office, the administration of such care to veterans had been spread across VHA.

Internal and External Reviews of VHA Organizational Structure

Recent internal and external reviews of VHA operations have identified deficiencies in VHA’s organizational structure and recommended changes that require significant restructuring to address, including eliminating and consolidating program offices and reducing VHA central office staff. For example, the Choice Act required VA to contract with a private entity to conduct an independent assessment of 12 areas of its health care delivery system and management processes, including VHA’s leadership. The Independent Assessment report, which VHA reported cost $68 million, was released in September 2015. It made recommendations across each of the 12 areas that support the report’s four systemic findings of (1) a disconnect in the alignment of demand, resources, and authorities; (2) uneven bureaucratic operations and processes; (3) non-integrated variations in clinical and business data and tools; and (4) leaders not fully empowered due to a lack of clear authority, priorities, and goals. For example, to address the finding of uneven bureaucratic business operations and processes, the report includes a recommendation for VHA to develop a patient-centered operations model that balances local autonomy with appropriate standardization and employs best practices for high-quality health care. To accomplish this, the report states that, among other things, VHA should reorient its central office to better support field operations in its delivery of care to veterans.

Pub. L. No. 113-146, § 202(g), 128 Stat. 1776.

On September 1, 2016, the President concurred with 15 of the 18 recommendations and directed VA to implement any of the 15 recommendations that the department was not already working to implement. assessment of the Commission on Care’s recommendations and a description of the recommendations VHA is directed to implement.

In addition to the reviews required by the Choice Act, VHA initiated internal task forces to examine organizational structure changes and make recommendations. For example, VHA chartered its governance task force in December 2014, with the goal of making recommendations to improve operational effectiveness and efficiency, and to align the agency to strengthen business processes. According to the task force’s charter, VHA needed to modify its governance structure to help address recent issues with substandard and inconsistent care delivery. The governance task force submitted a report in February 2015 with 21 recommendations. For example, the task force recommended reorganizing VHA’s central office around functional areas and establishing processes for regular review and revision of the VISN and VHA central office structures.

A governance task force recommendation to examine VISN staffing resulted in VHA chartering another task force, the VISN Staffing Task Force, in February 2015. In July 2015, this task force submitted a report to the DUSH for Operations and Management with recommendations for a new VISN staffing model. It included an option for reorganized VISN organizational structures; new positions focused on special populations (e.g., women’s health, rural health), nursing, and communications; and staffing limits that would result in 95 fewer VISN full-time-equivalent staff nationally in fiscal year 2016 compared to fiscal year 2012.

In addition, VHA chartered a task force—the Integrated Project Team—in September 2015 to develop a detailed, time-limited, and organization- specific plan for, and initiate implementation of, selected recommendations from the Independent Assessment required by the Choice Act. According to the task force’s charter, it was formed because, in a climate of intense public and congressional scrutiny, VHA needed to act quickly and could not afford to wait for the Commission on Care to publish its recommendations, which were to incorporate the results of the Independent Assessment.

VHA Does Not Have a Process That Ensures Recommended Organizational Structure Changes Are Evaluated and Implemented

Despite several critical internal and external reviews, VHA does not have a process that ensures that recommendations resulting from these reviews are evaluated to determine appropriate actions and that any such appropriate actions are implemented. (See app. I for a table of recent internal and external reviews that examined VHA’s organizational structure.) The lack of such processes is inconsistent with federal standards for internal control, which state that management should remediate identified internal control deficiencies on a timely basis. This remediation may include evaluating the results of reviews to determine appropriate actions, and, once decisions are made, completing and documenting corrective actions on a timely basis.

We found instances where VHA task force actions in response to recent recommendations for organizational structure changes were incomplete, not documented, or not timely: Governance task force. A senior VHA official on the task force— one of 10 senior officials who worked on the February 2015 report—told us that the Under Secretary for Health did not approve 13 of the 21 recommendations, so they would not be implemented. Additionally, VHA officials stated that there was no documentation of the Under Secretary for Health’s decisions on the recommendations because they were communicated verbally. Some of these 13 unimplemented recommendations focused on organizational structure changes that were later repeated in the Independent Assessment’s recommendations. For example, the Independent Assessment and the VHA governance task force reports both noted that VHA central office programs and staff had increased dramatically in recent years, resulting in a fragmented and “silo-ed” organization without any discernible improvement in business or health outcomes, and recommended restructuring and downsizing VHA central office. The Under Secretary for Health told us that his immediate priorities were to focus on improving access to care and hiring officials for vacant senior-level positions, and as a result he did not want to make significant changes to VHA’s organizational structure. Recommendations the Under Secretary for Health approved included those on improving the coordination and oversight of non-VA community care, restructuring the monthly meetings of VHA’s National Leadership Council, and establishing processes to develop and improve health care performance measures.

VISN Staffing Task Force. VHA officials told us that the DUSH for Operations and Management verbally communicated approval of the task force’s recommendations to change VISN staffing, which were developed over a week-long work session and incorporated input from all VISN directors. VHA officials provided us a VISN organizational chart with revised VISN staffing limits as documentation of the DUSH’s approval, but did not provide documentation of the decision made on each task force recommendation. For example, the documentation did not include the DUSH’s decisions on the task force’s recommendations on whether larger VISNs should be allowed to establish deputy network director positions, or if certain staff positions could be shared across VISNs. It also did not include information on why one staffing model was chosen over another. Officials stated that the DUSH was responsible for implementing the new VISN staffing model, but had not developed a timeline for its implementation. VHA officials were not able to provide us with any updates on implementation and told us in May 2016 that the task force had been disbanded.

Integrated Project Team. The task force, made up of 18 senior VA and VHA officials, conducted its work over about 6 months but did not produce the detailed implementation plan of the Independent Assessment recommendations it was chartered to create, according to VHA officials. A senior VHA official on the task force told us that the team planned to have a completed implementation plan in March 2016, and had identified senior-level VHA officials who would be responsible for ensuring implementation of the recommendations. The official also noted that the task force’s work would be included in VHA’s strategic planning summit in April 2016, at which point the task force would disband. VHA officials later told us that although the Integrated Project Team developed eight topic areas that applied to the Independent Assessment’s recommendations, and presented them at the strategic planning summit, they would not be moving forward with further work to develop and approve an implementation plan. In August 2016, VHA officials told us that since the strategic planning summit, they have been focused on addressing other priorities such as the Commission on Care report, proposed legislation that could affect VHA operations, and the Under Secretary for Health’s five priorities for VHA.

VHA devoted significant time and effort to these different task forces, but then either did not act or acted slowly to implement recommendations. For example, all three task forces included senior officials from VHA’s central office and VISNs, whose participation on the task forces created additional responsibilities beyond those related to their positions. In addition, all three sets of recommendations were available to VHA officials in 2015, but decisions on these recommendations were delayed by 6 months to 1 year after the report’s completion, and in the case of the Integrated Project Team’s work, decisions have not been made at all. One attribute of the federal internal control standard for timely remediation for identified deficiencies is assigning responsibility and authority for carrying out corrective actions. The three task force charters did not require senior leadership to make decisions on the results of reviews within a certain time frame, or ensure implementation of agreed- upon recommendations. As a result, when officials retired (as did the chairs for all three task forces) or resumed their regular duties, there were no other individuals or offices responsible for ensuring that recommendations were acted on, or any documentation available to track progress made. VHA officials expressed frustration and confusion at the lack of response from central office to the findings and recommendations resulting from task forces. Without a process for ensuring that the recommendations resulting from internal and external reviews are evaluated, decisions documented, and promptly acted on, VHA will not be able to ensure that officials are accountable for taking actions that will resolve deficiencies. VHA also cannot ensure that it is making efficient use of internal resources allocated to developing and implementing recommendations.

VHA Central Office Has Provided Little Monitoring and Did Not Anticipate Challenges for a Recent and Significant Organizational Structure Change, the VISN Realignment

The VISN realignment is a significant change to VHA’s organizational structure; it is the first large-scale reorganization of VISN boundaries since the VISNs were created in 1995. However, VISNs have been implementing this change with little monitoring from VHA’s central office. In addition, VHA did not proactively identify and provide guidance to address challenges VISNs and VAMCs have encountered. These actions are inconsistent with federal standards for internal control concerning monitoring and risk assessment. Specifically, these controls state that management should establish monitoring activities, evaluate the results, and remediate identified deficiencies in a timely manner. This monitoring may include ongoing activities that are built into operations, as well as evaluations that provide feedback on the effectiveness of the monitoring and identify possible deficiencies that require corrective actions. In addition, these controls state management should identify, analyze, and respond to changes that could affect the system.

In October 2015, VHA began to implement a realignment of its VISN boundaries, with the goal of aligning them with MyVA regional boundaries. This involved decreasing the number of VISNs from 21 to 18 and reassigning some VAMCs to different VISNs. The governance task force evaluated several options for aligning VISN boundaries with MyVA regions and for aligning VISN boundaries better with state lines, and proposed an 18-VISN configuration. For example, the governance task force proposed reassigning West Virginia VAMCs so that they would all report to one VISN instead of four different VISNs. (See app. II for pre- and post-realignment VISN maps, and a table that shows the extent that each VISN is affected by the realignment.) VHA officials anticipate that the realignment will be completed, at the earliest, by the end of fiscal year 2018. Directors from the 15 VISNs affected by the realignment described a range of actions that needed to be completed as part of the realignment, including setting up new VISN governance structures; merging clinical and administrative functions; and assessing the operations in VAMCs that have been reassigned to a VISN to ensure they are in alignment with the VISN’s practices, such as VAMCs’ use of service contracts. According to VHA, the realignment is not expected to impact veterans’ access to health care. For example, officials told us that the VISNs are expected to continue to honor historical geographical referral patterns for veterans—that is, to continue to refer veterans to the same VAMC or outpatient facility they were referred to prior to the realignment even if that VAMC or facility is part of a different VISN post- realignment.

VHA has provided little monitoring of VISNs’ implementation efforts, and it has not provided adequate guidance in anticipation of implementation challenges. VHA chartered a task force—the VISN Realignment Workgroup—to implement the realignment across the VISNs. According to its charter, the task force is responsible for developing an implementation plan and timeline for the realignment, as well as identifying barriers and solutions to mitigate them. The task force is made up of VHA central office and VISN officials and led by the DUSH for Operations and Management and a VISN director. It meets monthly with VISNs affected by the realignment. Although these meetings provide a structure for VISN directors to share actions taken and challenges encountered in the realignment process, VHA has not taken an active role in implementing the realignment. VISN Realignment Workgroup officials told us that at the beginning of the realignment, the workgroup provided guidance in the form of a communication plan that answered frequently asked questions about the realignment’s purpose, and made decisions about how the VISNs would be numbered. However, officials added that they wanted to be facilitators, rather than directors or implementers, for the realignment, and that VISN directors were capable of implementing the realignment independently without the need for a close level of monitoring.

Directors from several VISNs affected by the realignment told us that they have made decisions independently about how to implement the realignment in their VISNs, and many also noted that they continue to face challenges with implementation, including services and budgets. Directors from 12 of the 15 VISNs affected by the realignment told us they continue to face challenges in managing services and budgets. The director of a VISN that gained a VAMC with after-hours call center services on site told us he faced an unexpected task of consolidating his VISN’s existing call center services with those being provided at the VAMC. In addition, a VAMC director expressed concern about potentially having to re-start a VISN strategic planning exercise that the VAMC had participated in for 18 months because the VISN to which it had been reassigned had not done similar planning work. Finally, several VISN directors expressed concerns about how the realignment would affect their budgets, including one director who was concerned about losing a large VAMC that supplemented budget losses for other, smaller VAMCs in the VISN. “double-encumbered” positions. Six of the 15 VISNs affected by the realignment are in the process of merging, which has resulted in double-encumbered positions—two officials serving in the same position, such as two Chief Financial Officers. For example, one VISN director told us at the time of our interview (February 2016) that there were about 30 double-encumbered positions between two merging VISNs, which represented about one-third of their total staff. According to VHA, 23 positions remained double-encumbered in the merged VISN as of August 2016. Several VISN directors described challenges in resolving double-encumbered positions. For example, without authorization to offer Voluntary Separation Incentive Payments—also known as buyout authority—or specific instructions from central office, directors told us they were concerned that any actions they took (such as having officials compete for the position) would be inconsistent with other VISNs. VHA officials told us that they have been involved in helping VISNs address double-encumbered positions, such as assisting in finding staff new positions within VHA, but not all such situations had been resolved. Further, according to VHA, one merged VISN received central office approval to pursue buyout authority, and two other merged VISNs were awaiting approval as of August 2016. VISN directors with double-encumbered staff expressed frustration at the lack of resolution of this issue and told us it has contributed to low staff morale. Double-encumbered positions were a VISN realignment challenge that VHA could have anticipated and made plans to address before the realignment started, but according to senior task force officials, the task force did not establish a subgroup on human resources until after the realignment began. As of August 2016, VHA reported there were 37 double-encumbered positions across the three merged VISNs. information technology. Six of the 15 directors from VISNs affected by the realignment told us that they continue to face information technology challenges, including having to manually reconstruct datasets to add or delete VAMCs that are still electronically associated with their former VISNs. One VISN director described difficulties in obtaining access rights to data from VAMCs that were reassigned to the VISN. Similarly, a VAMC director told us that the facility was no longer able to access its own data after changing VISNs because the data were located on their former VISN’s server, requiring workarounds to gain access because there was no guidebook or plan for how to transfer VAMC data from one VISN to another.

VISN Realignment Workgroup officials told us they were aware of continued realignment challenges, but had no plans in place at the time of our review to expand their monitoring efforts to include an evaluation of the implementation of the realignment. Officials said that if they conducted an evaluation, the best time frame would be after the realignment is mostly complete because realignment actions are still in the process of being implemented. However, an evaluation may be useful to correct any identified implementation deficiencies. It can also help inform future organizational structure changes by offering VHA the opportunity to anticipate challenges and proactively provide guidance to address them. For example, the Under Secretary for Health told us he would be open to other VHA organizational structure changes in the future once he completes the process of filling vacant leadership positions within VHA. In addition, the implementation of the Commission on Care report recommendations could result in large-scale organizational structure changes. VISN Realignment Workgroup officials told us they thought that an evaluation could also be useful for identifying any unintended consequences resulting from the realignment that bear examination.

Conclusions

VHA is aware that it is providing health care services to veterans in a time of significant scrutiny from us and others. This scrutiny comes in the wake of VHA’s inability to provide timely health care services to veterans, which contributed to the placement of VA health care on our High Risk List. Although VHA has spent considerable resources—staff time and funds— on reviews and task forces that recommended improvements in its organizational structure, VHA lacks the processes needed to ensure that officials can evaluate those recommendations, document decisions, monitor and evaluate implementation, and hold staff accountable. In addition, without adequate monitoring, including a plan for evaluation, VHA cannot be certain it is effectively implementing the ongoing VISN realignment. VHA would also miss the opportunity to apply lessons learned from such an evaluation to future organizational structure changes, such as those it makes in response to the Commission on Care report’s recommendations. Without processes for evaluating and implementing recommendations and actively monitoring major organizational structure changes, there is little assurance that VHA’s delivery of health care to the nation’s veterans will improve.

Recommendations for Executive Action

We recommend that the Secretary of Veterans Affairs direct the Under Secretary for Health to take the following two actions: 1. Develop a process to ensure that organizational structure recommendations resulting from internal and external reviews of VHA are evaluated for implementation. This process should include the documentation of decisions and assigning officials or offices responsibility for ensuring that approved recommendations are implemented. 2. Conduct an evaluation of the implementation of the VISN realignment to determine whether deficiencies exist that need corrective actions, and apply lessons learned from the evaluation to future organizational structure changes, such as possible changes to VISN staffing models or actions to implement Commission on Care recommendations.

Agency Comments

We provided a draft of this report to VA for comment. In its written comments, reproduced in appendix III, VA agreed with our conclusions and concurred with our recommendations. In its comments, VA stated that VHA plans to develop processes to ensure organizational structure changes are evaluated and implemented appropriately and to evaluate the implementation of the VISN realignment, with estimated completion dates for the development of these processes by March 2017 and September 2017, respectively. VA also stated that as the VISN realignment continues, VHA will strive to ensure a seamless flow of communication and execution of VHA’s mission at all levels.

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If you or your staff have any questions about this report, please contact me at (202) 512-7114 or at draperd@gao.gov. Contact points for our Offices of Congressional Relations and Public Affairs may be found on the last page of this report. GAO staff who made key contributions to this report are listed in appendix IV.

Appendix I: Recent External and Internal Reviews That Include an Examination of Veterans Health Administration’s (VHA) Organizational Structure

Appendix I: Recent External and Internal Reviews That Include an Examination of Veterans Health Administration’s (VHA) Organizational Structure VHA contracted with the Centers for Medicare & Medicaid Services’ Alliance to Modernize Healthcare (operated by MITRE Corporation, a private entity) and the Institute of Medicine to conduct the assessment. Parts of the evaluation were subcontracted to other organizations, including McKinsey & Company and the RAND Corporation.

Appendix II: Department of Veterans Affairs’ (VA) MyVA Regions and the Veterans Health Administration’s (VHA) Veterans Integrated Service Network (VISN) Realignment

VA announced a major organizational initiative in September 2014 called MyVA. As part of this initiative, the department established a single regional framework for its three administrations—VHA, the Veterans Benefits Administration, and the National Cemetery Administration— dividing the United States into five regions based on state boundaries. (See fig. 2.)

Following the MyVA initiative’s implementation, VHA announced plans to realign, and in some cases, merge its VISNs—regional offices that oversee networks of VA medical centers (VAMC) and outpatient facilities—so that they geographically aligned with MyVA regional boundaries. (See figs. 3 and 4 for pre- and post-realignment VISN maps, respectively; and table 2 for information on the extent that each VISN is affected by the realignment.) The VISN realignment began in October 2015 and VHA officials anticipate it will be completed, at the earliest, by the end of fiscal year 2018.

Some VISN borders will cross state lines and MyVA regional boundaries once the realignment is complete. VHA officials told us this reflects geographical referral patterns and the locations of outpatient clinics, which can be across state lines from their associated VAMCs. VHA officials told us that the VISNs are expected to continue to honor historical geographical referral patterns for veterans—that is, to continue to refer veterans to the same VAMC or outpatient facility they were referred to prior to the realignment even if that VAMC or facility is part of a different VISN post-realignment.

Appendix III: Comments from the Department of Veterans Affairs

Appendix IV: GAO Contact and Staff Acknowledgments

GAO Contact

Debra A. Draper, (202) 512-7114 or draperd@gao.gov.

Staff Acknowledgments

In addition to the contact named above, Janina Austin, Assistant Director; Malissa G. Winograd, Analyst-in-Charge; Amanda Cherrin; and Amanda Pusey made key contributions to this report. Also contributing were Jennie F. Apter, George Bogart, Muriel Brown, and Jacquelyn Hamilton.