Whistleblower: Texas VA Runs Like a ‘Crime Syndicate’

Last week, President Obama pledged to address allegations of corruption and dangerous inefficiencies in the veterans’ health-care system. But before the president could deliver on his pledge, the scandal has spread even further. New whistleblower testimony and internal documents implicate an award-winning VA hospital in Texas in widespread wrongdoing—and what appears to be systemic fraud.

Emails and VA memos obtained exclusively by The Daily Beast provide what is among the most comprehensive accounts yet of how high-level VA hospital employees conspired to game the system. It shows not only how they manipulated hospital wait lists but why—to cover up the weeks and months veterans spent waiting for needed medical care. If those lag times had been revealed, it would have threatened the executives’ bonus pay.

What’s worse, the documents show the wrongdoing going unpunished for years, even after it was repeatedly reported to local and national VA authorities. That indicates a new troubling angle to the VA scandal: that the much touted investigations may be incapable of finding violations that are hiding in plain sight.

The current VA scandal broke in Phoenix last month, when a former doctor at a VA hospital there became the first whistleblower to gain national attention. The doctor’s allegations of falsified appointments—and veterans dying while they waited for treatment—unleashed a wave of similar claims from VA employees nationwide. In Cheyenne, Wyoming, Chicago, and Albuquerque, more VA whistleblowers came forward claiming that the same fraudulent scheduling was being used in the hospitals where they worked. At last count, the VA inspector general’s investigation had expanded to 26 separate facilities.

The torrent of claims led to Senate hearings, calls for VA Secretary Eric Shinseki to resign, multiple investigations and President Obama’s own public statement last week. Paul Rieckhoff, founder and chief executive officer of Iraq and Afghanistan Veterans of America (IAVA), believes that even more revelations are coming.

“This newest case just further illustrates that the scandal is much more far reaching than most people realize,” Rieckhoff said, “Phoenix was just the tip of the iceberg. Scandal has become the new normal, it’s the status quo at the VA right now.”

But, despite the political uproar and the growing investigations, the root causes of the VA crisis have remained murky. New documents and whistleblower testimony obtained by The Daily Beast shed light on exactly how fraud is being perpetrated in the VA and its underlying causes.

There’s enormous pressure to report favorable wait times for VA patients, the Texas whistleblower explained, even if those wait times are completely false.

“If [VA] directors report low numbers, they’re the outlier. They won’t stay a director very long and they certainly won’t get promoted. No one is getting rewarded for honesty. They pretty much have to lie, if they don’t they won’t go anywhere,” the whistleblower added. Weighted more heavily than other performance measures, the wait time numbers alone “count for 50% of the executive career field bonus, which is a pretty powerful motivator.”

ANATOMY OF A FRAUD

The clinician has been alerting authorities to the wrongdoing at their facility for years but the corruption has persisted despite multiple reports and investigations by the VA’s inspector general.

The case of Dr. Joseph Spann, a recently retired doctor who reported malfeasance in the Texas VA system, where he worked for 17 years, raises the possibility that official investigations may only be hiding the problems they were charged to root out.

After retiring in January of this year Spann sent a letter to VA investigators accusing a VA employee of manipulating patient wait lists to hide treatment delays for veterans. The rigged reporting scheme Spann described in his letter, which threatens veterans’ lives by delaying their treatment, is the same method that has been exposed in Phoenix, Cheyenne, Albuquerque, and scores of other VA hospitals across the country.

According to Spann, Dr. Gordon Vincent, chief of radiology at Olin E. Teague Veterans Medical Center in Temple, Texas, didn’t just break VA policy by manipulating veterans’ appointments himself. He ordered VA employees across central Texas to engage in the same fraudulent practice.

The VA said it investigated Spann’s charges, and, after, finding nothing to substantiate the claims, cleared Vincent and the Texas VA.

But documents obtained by The Daily Beast appear to show Dr. Vincent doing precisely what Spann accused him of—the activities the VA said it could not substantiate.

Veterans are supposed to be seen within 14 days of their desired date, according to VA policy.

By changing the desired date, Dr. Vincent, a VA section chief, was violating well-established scheduling rules detailed in an official VA memo from April 2010 and re-emphasized in a separate policy directive from June of that year. But forging veterans’ desired dates seems to have been widely considered a low-risk, high-reward form of cheating. Changing the dates made it seem as if patients were being seen within the prescribed 14-day window, which reflected well on the hospital and put its staff in line for bonuses.

For the veterans seeking care, however, it had no such benefits.

In his letter to the VA’s Inspector General’s Office, Spann wrote, “I cannot categorically say that I ever saw a patient die from such manipulated scheduling, but I did see several cancer patients have their possible surgery or chemotherapy treatments delayed awaiting the required radiology tests.”

The VA whistleblower, who provided The Daily Beast with the records implicating Dr. Vincent, works as a medical provider for sick veterans. “It’s plain and simple common sense,” the clinician said. “Every delay in a patient’s diagnosis is an injury. The more severe the veteran’s condition, the worse the injury caused by the wait as the disease is allowed to progress.”

Now that the VA has exonerated Dr. Vincent, there may be no one left to evaluate the injury caused by the appointments he canceled.

NOTES ON A SCANDAL

The document described above is only one piece of evidence in a larger docket against Vincent, which is itself part of a larger record of corruption in the VA that extends far beyond Vincent or any one individual. In 2011, the VA’s inspector general investigated the Central Texas health-care system in response to complaints it had received. The inspector general found that manipulated appointments were widespread and hid significant delays, but the report doesn’t seem to have led to a single VA official being disciplined or officially held responsible for gaming the system.

The first message in the chain comes from a scheduling coordinator, James Anderson, who tells doctors across the state to use January 2 as the desired date for veterans. The Central Texas VA Chief of Staff, William Harper, then reproaches Anderson, saying, “You cannot do this!!!! This is essentially fraud. The desired date is what it is and if we don’t meet the standard then we will work to improve.”

After the warning from Harper and questions about scheduling from several other doctors, including Spann, the final comment in the thread concerns Dr. Vincent. The message reads: “It doesn’t help if you insist on a date that doesn’t meet their 30-day criteria. Vincent just cancels the order. End of story. ”

In other words: it never mattered what was entered to show the “desired date” requested by the patient or the medical provider treating them. Despite Harper’s protestations, if the entry didn’t help meet the VA’s performance objectives it never made it into the system.

Nevertheless, the VA recently cleared Vincent of wrongdoing and, while acknowledging scheduling malpractice, blamed it on mistakes made by lower-level clerks.

“I saw the press release saying it wasn’t Vincent or any of the executives, that the schedulers were entering the desired dates incorrectly but they were not directed to do so by management. That’s just not true and we’ve got mountains of evidence proving it,” the clinician told The Daily Beast.

PERFORMANCE INCENTIVES

On the ultrasound request form, Dr. Vincent writes that he canceled the order because it was “entered in error.” But that would have come as news to the medical provider who actually interacted with the veteran and entered the date based on their evaluation of the patient’s needs. The real reason for canceling it, according to both Dr. Spann and the whistleblower who spoke with The Daily Beast, was to meet the VA’s performance objectives—whatever the cost.

Meeting the performance objectives, which made executives eligible for bonuses and put them in line for promotions, became the overriding imperative among VA executives, according to both Spann and the whistleblower.

And scoring high on the performance measures is of paramount consideration in a VA hospital. “This is what your bosses, the executives, are being evaluated for,” the whistleblower said. “So if you work for them you must support this because that’s how they’re prioritizing their evaluation of your job.”

The VA’s performance measures were originally established to provide uniform criteria for evaluating employees.  The idea was to use the grading system to reward those who met the standard with bonuses and identify those who were lagging behind. But over time, VA executives realized that the wait time numbers they reported were almost more important than anything else—including the actual care they provided veterans—in how they were judged by the VA’s leadership. At that point the measures became a perverse incentive, encouraging VA facilities across the country to hide problems by cheating their numbers. Eventually, cooking the books became an alarmingly regular procedure—a standard that might have remained if it hadn’t been exposed in Phoenix and unraveled over the past month.