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Hearing Transcript on Optimizing Care for Veterans with Prosthetics: An Update

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Committee on Veterans' Affairs, Health Subcommittee,Optimizing Care for
Veterans with Prosthetics:  An Update,7-31-12

 

 

OPTIMIZING CARE FOR VETERANS WITH PROSTHETICS: 
AN UPDATE

 



HEARING

BEFORE THE

SUBCOMMITTEE ON HEALTH

OF THE

COMMITTEE ON VETERANS' AFFAIRS

U.S. HOUSE OF REPRESENTATIVES

ONE HUNDRED TWELFTH CONGRESS

SECOND SESSION


JULY 31, 2012


SERIAL No. 112-72


Printed for the use of the Committee on Veterans'
Affairs

 

 

U.S. GOVERNMENT PRINTING OFFICE

WASHINGTON, DC:  2012


For sale by the Superintendent of
Documents,  U.S. Government Printing Office

Internet: bookstore.gpo.gov  Phone: toll free (866) 512-1800; DC
area (202) 512-1800

Fax: (202) 512-2104  Mail: Stop IDCC, Washington, DC 20402-0001

 



COMMITTEE ON VETERANS' AFFAIRS


JEFF MILLER, Florida, Chairman

  CLIFF STEARNS, Florida

DOUG LAMBORN, Colorado

GUS M. BILIRAKIS, Florida

DAVID P. ROE, Tennessee

MARLIN A. STUTZMAN, Indiana

BILL FLORES, Texas

BILL JOHNSON, Ohio

JEFF DENHAM, California

JON RUNYAN, New Jersey

DAN BENISHEK, Michigan

ANN MARIE BUERKLE, New York

TIM HUELSKAMP, Kansas

MARK E. AMODEI, Nevada

ROBERT L. TURNER, New York
BOB FILNER, California, Ranking

CORRINE BROWN, Florida

SILVESTRE REYES, Texas

MICHAEL H. MICHAUD, Maine

LINDA T. SÁNCHEZ, California

BRUCE L. BRALEY, Iowa

JERRY MCNERNEY, California

JOE DONNELLY, Indiana

TIMOTHY J. WALZ, Minnesota

JOHN BARROW, Georgia

RUSS CARNAHAN, Missouri
 

 

 

Helen W. Tolar,
Staff Director and Chief Counsel


SUBCOMMITTEE ON HEALTH

ANN MARIE BUERKLE, New York,
Chairwoman

CLIFF STEARNS, Florida

GUS M. BILIRAKIS, Florida

DAVID P. ROE, Tennessee

DAN BENISHEK, Michigan

JEFF DENHAM, California

JON RUNYAN, New Jersey
MICHAEL H. MICHAUD, Maine,
Ranking

CORRINE BROWN, Florida

SILVESTRE REYES, Texas

RUSS CARNAHAN, Missouri

JOE DONNELLY, Indiana

Pursuant to clause 2(e)(4) of Rule XI of the Rules of the House,
public hearing records of the Committee on Veterans' Affairs are also
published in electronic form. The printed hearing record remains
the official version.
Because electronic submissions are used
to prepare both printed and electronic versions of the hearing record,
the process of converting between various electronic formats may
introduce unintentional errors or omissions. Such occurrences are
inherent in the current publication process and should diminish as the
process is further refined.

 

       

C O N T E N T S

July 31, 2012


Optimizing Care for Veterans with Prosthetics:  An Update

OPENING STATEMENTS

Chairwoman Ann Marie Buerkle

    Prepared statement of Chairwoman Buerkle

Hon. Michael H. Michaud., Ranking Democratic Member


 

WITNESSES

The Honorable Robert A. Petzel, M.D., Under Secretary for
Health Veterans, Health Administration, U.S. Department of Veterans Affairs

    Prepared statement of Dr. Petzel

Accompanied by:

Mr. Philip Matovsky, Assistant Deputy Under Secretary for Health, Administrative
Operations Veterans Health Administration, U.S. Department of Veterans Health

Dr. Lucille Beck, Ph.D., Chief Consultant, Rehabilitation Services Director,
Audiology and Speech Pathology Acting Chief Consultant, Prosthetics and Sensory
Aids Service Veterans Health Administration, U.S. Department of Veterans Affairs

Mr. C. Ford Heard, Associate Deputy Assistant Secretary for Procurement Policy,
Systems and Oversight, Office of Acquisitions, Logistics and Construction

MATERIAL SUBMITTED FOR THE RECORD

Questions and Responses from the
United States Department of Veterans Affairs

Summary of Plan to Merge Prosthetic and Sensory Aids
Service and Office of Rehabilitation Services

 


OPTIMIZING CARE FOR VETERANS WITH PROSTHETICS:  AN
UPDATE


Tuesday, July 31, 2012

U. S. House of Representatives,

Subcommittee on Health,

Committee on Veterans' Affairs,

Washington, DC.

The subcommittee met, pursuant to notice, at
4:40 p.m., in Room 334, Cannon House Office Building, Hon. Ann Marie Buerkle
[Chairwoman of the subcommittee] presiding.

Present:  Representatives Buerkle, Roe, and
Michaud.

OPENING STATEMENT OF CHAIRWOMAN ANN
MARIE BUERKLE,  SUBCOMMITTEE ON
HEALTH

Ms. BUERKLE.  The subcommittee will come to order.  Good
afternoon and welcome to today's subcommittee hearing:  Optimizing Care for
Veterans With Prosthetics:  An Update.  Today's hearing is a continuation of a discussion we began almost 3 months ago when this
subcommittee heard from veterans with amputations, members of our VSOs, and
officials from the Department of Veteran Affairs to review the VA's capability
of delivering state‑of‑the‑art prosthetic care to our
veterans with amputations and the impact of the VA's planned prosthetic
procurement reforms.  These reforms will, among other things, take prosthetic
purchasing authority away from the prosthetic specialists and transfer it to contracting officers. 

As our veterans so eloquently described in
May, prosthetic care is unlike any other care that VA may provide, and when
we make the mistake of treating it as such, no less than the daily and ongoing
functioning and quality of life of our veterans is at stake.  I was very
troubled to hear from our veterans such strong opposition to the proposed
reforms, arguing forcefully that they would lead to substantial delays in care
for veterans with amputations and clinical judgments regarding veterans' needs
being overridden by individuals with little or no experience in prosthetic
care. 

In mid‑June, following our hearing, I
sent a letter, along with Ranking Member Michaud, to the Secretary, requesting
that the Department respond to a number of questions and provide certain
materials regarding the strategy, plans, and criteria used to develop,
consider, design and evaluate the proposed reforms as well as the pilot
programs that preceded them. 

Our goal was to understand the analysis VA
employed to develop the reforms and what was behind the decision that they were the best idea for our veterans, especially those who have experienced loss of
limb as a result of service to our Nation. 

Sadly, the Department's response, which came
a week after the deadline requested in our letter, did not provide the
information or the level of detail we asked for, and did nothing to assure me
that the plan would be effective or that our veterans' concerns were
unfounded.  To the contrary, a close review of the materials VA provided leads
me to believe that the reforms were developed without careful and thorough
consideration. 

It leads me to believe that they were
developed without sufficient input from our veterans themselves, our veteran
service organization advocates, or other stakeholders.  It leads me to believe
that they were developed and implemented after being tested for a very short
period of time at a small number of locations, with very limited feedback.  It
led me to believe that they were developed without adequately measuring their
impact on patient care.  It led me to believe they were developed without
safeguards in place to ensure that our veterans' and clinicians' wishes are
respected and timeliness goals are met. 

It is concerning that VA would move forward
with instituting such large‑scale changes that so directly impact our
veteran patients in this way.  If my concerns are groundless, and I truly hope
they are, I want the VA in explicit detail to explain why. 

During our last hearing, our veterans and
VSOs spoke very loud and clearly.  Now it is time for the VA to do the same. 

[The statement of Ms. Buerkle appears in the Appendix.]



Ms. BUERKLE.  Again, I thank you all
for joining us this afternoon.  Our ranking member, Mr. Michaud, is on the floor.  We will
give him an opportunity to provide remarks when he returns. 

Now I would like to invite our first and only panel to the witness table. 

Joining us from VA is the Honorable Under
Secretary for Health, Dr. Robert Petzel.  Dr. Petzel is accompanied by Philip
Matovsky, the Assistant Deputy Under Secretary for Health, Administration
Officers; Dr. Lucille Beck, Chief Consultant of Rehab Services, Director of
Audiology and Speech Pathology, and the Acting Chief Consultant for Prosthetics and
Sensory Aids Service; and Ford Heard, the Associate Deputy Assistant Secretary
for the Office of Acquisition and Logistics. 

Thank you all very much for being here. 

Dr. Petzel, thank you for your service to our
veterans and for taking the time out of your schedule to be here this afternoon
to address what we consider an extremely important issue on behalf of our
veterans.  I look forward to hearing your testimony. 

You may proceed at this time.  Thank you. 



STATEMENTS OF HON. ROBERT A. PETZEL, M.D., UNDER SECRETARY FOR HEALTH,
VETERANS HEALTH ADMINISTRATION, UNITED STATES DEPARTMENT OF VETERANS AFFAIRS,
ACCOMPANIED BY PHILIP MATOVSKY, ASSISTANT DEPUTY UNDER SECRETARY FOR HEALTH,
ADMINISTRATIVE OPERATIONS, VETERANS HEALTH ADMINISTRATION, UNITED STATES
DEPARTMENT OF VETERANS HEALTH, LUCILLE BECK, PH.D., CHIEF CONSULTANT,
REHABILITATION SERVICES DIRECTOR, AUDIOLOGY AND SPEECH PATHOLOGY, ACTING CHIEF
CONSULTANT, PROSTHETICS AND SENSORY AIDS SERVICE, VETERANS HEALTH
ADMINISTRATION, UNITED STATES DEPARTMENT OF VETERANS AFFAIRS, AND FORD HEARD,
ASSOCIATE DEPUTY ASSISTANT SECRETARY, OFFICE OF ACQUISITIONS AND LOGISTICS,
UNITED STATES DEPARTMENT OF VETERANS AFFAIRS

STATEMENT OF HON. ROBERT A. PETZEL, M.D.

Dr. PETZEL.  Chairwoman Buerkle,
Ranking Member Michaud, and members of the subcommittee, I want to thank you
for the opportunity to speak about the Department of Veterans Affairs
prosthetics procurement reform.  Thank you, Madam Chairwoman, for introducing
the people that are accompanying me. 

VA testified before this subcommittee and the
Subcommittee on Oversight and Investigations in May, 2012.  We did this
regarding our efforts to maintain the high quality of prosthetics VA provides
to veterans while instituting reforms to improve compliance with the Federal
Acquisition Regulations and the Competition in Contracting Act, and to improve
our management of government resources. 

In follow‑up to these hearings, the
chairwoman and ranking member submitted a letter to VA on June 21,
requesting a response by July 6 that would offer additional information
about these reforms.  On July 12, VA submitted information to the
subcommittee to begin to address the subcommittee's request.  I apologize that
submission was late and that it was not sufficient to address your concerns. 

Yesterday, at the subcommittee's request, we
formally submitted additional information to provide a narrative account of our
efforts, and we believe this will better meet your needs and provide for some
further understanding.  If you still have additional questions, we would be
happy to respond. 

You also have asked for an update on the
actions the Department has taken to reform the prosthetics procurement process
since May 21 in the hearing.  On May 23, 2012, VA issued a memorandum
to the field advising them that it is VA's policy that those engaged in the
ordering of biological implants must comply with the FAR and VA acquisition
regulations.  That memorandum states that the VA official performing the
purchasing activity is to comply with a physician's prescription. 

Furthermore, in response to your advice to
transition our warrant program with deliberation and caution, we extended the
date for finalizing this transition from July 1 until September 30,
2012.  This transition continues with

ongoing communication and coordination within the VISNs to ensure that
procurement services are not disrupted.  We are closely monitoring the staffing
levels for our contracting organizations, the workload levels, and most
importantly, the timeliness of procurement actions.  If we find that we have insufficient
resources to complete this transformation, we will extend the timeline to allow
for a smooth transition. 

Finally, you asked me to address the
potential impact these reforms could have on veterans.  As we testified in May,
we do not believe that veterans will be adversely impacted in any way.  Indeed,
this change should result in no visible effect for veterans.  We believe that
our reform efforts are acceptable to the major service organizations. 

Two proposals appear to have raised
interest.  First of all, our plans to standardize the purchasing of prosthetics
and other devices; and secondly, our plan to transition procurement decisions
to warranted contracting officers.  On the first plan, many of the products VA
purchases are already on contract in some way, shape, or form.  They are either
going to become a part of a veteran or they are going to be a critical part of
their daily lives.  We understand the critical value these devices offer and
the independent clinical judgment of our providers will remain and must remain
fully intact. 

A contracting officer will not have the
capacity to override a physician's order.  This aspect guides a decision making
process of our leadership and will be preserved in our policies and in our
procedures.  Clinicians, in consultation with veterans, will decide what
devices we procure.  Our reforms are designed only to modify how we procure
them.  When products are generally available and interchangeable, competitive
procurement may be appropriate.  We are hoping that in the long term we can
develop a catalog that will facilitate more cost‑effective purchasing in
those instances. 

On the second plan concerning the transition
of procurement decisions, I, again, emphasize that this is only changing how we
purchase, not what we purchase.  By shifting to contracting specialists, we can
ensure that we secure fair and reasonable prices for the products while still
delivering the personalized state‑of‑the‑art care that has
been earned by these veterans. 

In conclusion, VA has been engaging in
prudent and appropriate reform to improve the business processes governing the
procurement of prosthetic devices for veterans.  We take great care to ensure
that these changes improve the accountability of these purchases while
maintaining the high quality of care and clinical decision making critical to
veterans health care.  Clinicians determine the prosthetic needs of veterans as
a part of their clinical care, and VA
procures the devices necessary to achieve personal clinical outcomes.  Our
reform efforts will not disturb this arrangement. 

We appreciate the opportunity to appear
before you today to discuss this important program.  My colleagues and I are
prepared to answer your questions. 

[The statement of Dr. Petzel appears in the Appendix.]



Ms. BUERKLE.  Thank you very much, Dr. Petzel. 

I will now yield myself 5 minutes for questions.  I guess my first
question, as I am listening to your testimony today, as well as in the last
hearing, is could you just briefly explain to me what
prompted this change? 

Dr. PETZEL.  Certainly, Madam
Chairwoman.  The reform of VA's procurement processes really began more than 2
years ago, and they started at the Department level with the procurement of
equipment, with the procurement of pharmaceuticals.  This is a system wide
effort to ensure that we have professional, certified contracting people doing
the procurement.  We have been criticized in the past by organizations such as
the IG for not having a professional procurement force and for not following in
all instances the Federal regulations or VA's acquisition regulation. 

So the effort, in no way, is directed
specifically at prosthetics.  This began, as I say, with equipment.  It has
moved into pharmaceuticals.  Prosthetics is really the last area of procurement
within VA where we have not had certified warranted procurement officers doing
the majority of the procurements above $3,000. 

Ms. BUERKLE.  Thank you.  When I hear
words like "equipment" and "pharmaceuticals" and then "the development, possibly, of a
catalog," what you are talking about in those instances are so very different
from the testimony we heard in the last hearing regarding the personal nature
of a prosthetic.  Amoxicillin is amoxicillin.  A thermometer is a thermometer. 
But a prosthetic is unique to that person and to his needs or her needs.  That
is my concern with this process, that it will become just like any other
procurement.  This is a very different process.  I think this is what
concerns the VSOs and concerns the veterans.  This is a uniquely personal
service that we have to give to that veteran.  What I am hearing here when
you talk about cataloging purchases concerns me greatly. 

Dr. PETZEL.  Madam Chairwoman, we
absolutely agree with you.  This is the most personal of work that the VA
does.  Crafting and fitting a prosthetic limb to an individual that has lost an
arm or a leg is a very personal process.  The reforms that we are talking about
in terms of procurement will not interfere with that process.  The physician
orders the prosthetic.  And that order can be very specific.  The prosthetist
works with the patient to determine where the best place is to purchase that. 
As you know, we have 600 contracts in the private sector, and not all, but most
of our procurement occurs in the private sector. 

In the process of transitioning and during
the pilots, we audited the orders that the physician had written; we audited
the purchase contract, what was actually purchased; we looked at the timeliness
between when that order was placed and when it was actually purchased; and we
looked at the satisfaction, particularly of the prosthetist and the physicians,
as to whether or not the needs of that veteran, as they described them, were
met.  And in the pilots we found that that was true; that that worked very
well. 

The only misjudgment that we made in the
pilots is that we expected a higher level of productivity from the contracting
officers than we actually found, and we had to revise the number of contracting
officers that we felt we needed because we felt that the four contracts per day
that they originally were going to perform was more than was
doable; that 2.5 is a better example.  But, otherwise, the pilots indicated
that things went very well. 

Ms. BUERKLE.  Can you talk to us about
the pilots?  How many pilots were done?  Over what period of time were
the pilots conducted? Which VISNs were included in the various pilots?  

Dr. PETZEL.  Yes, Madam Chairman, we
can, and I would like to turn to Mr. Matovsky to give you some of the details
about the pilots. 

Thank you. 

Mr. MATOVSKY.  Thank you, sir.  We
conducted three pilots, one of them in VISN 6, which is North Carolina, parts
of Virginia, parts of West Virginia; VISN 11, which is Indiana ‑‑
I am going to test my geography here ‑‑ parts of Michigan as
well; and then VISN 20, which is the Upper Northwest on into Alaska.  We
selected them because they were a broad representation, some of them highly
rural, some of they very large and growing.  We also ran them from the period
of January through the end of March, for 3 months.  I believe one of them
scooted into April. 

We tested two different processes.  So one
process utilized fully the ECMS, or Electronic Contract Management System, to
place the order and another one in VISN 6 used a slightly different process. 
That is the basis for it. 

We tested the onboarding of our staff, the
training of our staff, the communication and the collaboration with the
prosthetist, the prosthetics purchasing agent, and then the contracting
management staff.  As Dr. Petzel indicated, we did conduct some audits.  For
instance, we looked at the technical appropriateness of the contracting
action.  But more importantly, we looked at what percentage of the time did the
contracting officer adhere to the physician's prescription.  A hundred percent
of the time, the contracting officer adhered to the prescription. 

Ms. BUERKLE.  Thank you.  With that I
will yield to the ranking member, Mr. Michaud, for any opening statement you
might have and 5 minutes for your questions. 

Mr. MICHAUD.  Thank you very much,
Madam Chair.  I apologize for being late.  I was managing the veterans bill on
the House floor.  This is the earliest I could get back. 

OPENING STATEMENT OF HON. MICHAEL H. MICHAUD, RANKING
DEMOCRATIC MEMBER

I want to thank everyone for attending this
very important hearing.  This afternoon is a follow‑up.  And I also would
like to thank the chairwoman for her persistence in holding the Department
accountable on issues such as prosthetics, not just for care, but also for
procurement, which is so important for the veterans.  Every veterans' needs are
unique.  VA should get this right. 

We have learned during the last hearing on
this issue in May about VA's proposed changes in the procurement of
prosthetics.  At that hearing, there was a high degree of concern expressed
among some of our witnesses as to the effectiveness of these changes.  We are
alarmed by the possible negative impacts on patient care, including substantial
delays in care and clinical judgments regarding veterans' needs being
overridden by individuals with little or no working knowledge of prosthetic
care.  And we sent a bipartisan letter to the Secretary outlining our concerns
and soliciting answers to several of our questions. 

This is the third hearing in a handful of
months on this particular issue, and I remain committed to working with the
very dedicated staff at the Department of Veterans Affairs and the advocacy
community to assure that our veterans are getting the best care that we can
deliver in a timely way.  In this joint effort and joint challenges this
subcommittee stands ready to help. 

And I read through your testimony and I just
have a few questions, if I might.  In your testimony you said:  We believe that
many of our reform efforts are acceptable to all concerned parties.  When you
say "we believe," have you worked with the VSOs and the veterans to
find out what their concerns are? 

Dr. PETZEL.  Congressman Michaud, we
have.  Since the May hearing, there have been multiple meetings with the
service officer representatives.  I have a breakfast monthly with six of the
largest service organizations.  We made a presentation and a discussion at that
breakfast earlier in July.  And then just a day ago, on Monday, at a conference
call with the service organizations ‑‑ the American Legion,
VFW, PVA, the DAV, Amvets, and the Blind Veterans of

America ‑‑ to discuss what we want to do.  And I can say that there
was no objection at that meeting and at that conference to our proposed
reforms. 

Mr. MICHAUD.  Thank you.  My next
question actually is two, but it is a related issue.  Is the VA central office
instructing VISNs to restrict access to contract prosthetics or orthotists? 
If not, what about the VISNs?  Are the VISNs restricting access to contracts for
prosthetics for veterans who rely on those prosthetics? 

Dr. PETZEL.  Congressman Michaud, our
policy that is this is a veteran's choice.  That we have, as I mentioned
earlier, 600 contracts.  Most of the prosthetics actually are fabricated and
fitted by private vendors.  Our policy very clearly states that there must be
available in every one of the medical centers a list of the contractors, and
this must be explained to the veteran, that they have a choice in doing that. 

The practice that I think you may be hearing
about from some of the vendors is that around the country, how this interaction
occurs is variable.  In some instances, in rural areas, where we do not have
prosthetists that do fitting, et cetera, people from the outside, from the private
sector, are invited into the prosthetics clinic and are actually involved in
the discussions with patients because we don't have the personnel to do that. 
At our larger medical centers where we have a large cadre of prosthetists, it
would be less likely that the vendors would be invited in to participate in the
clinic because we have the personnel to do that.  But if there is a connection
between a patient and a prosthetist, that individual is invited in and is
welcome to come to the clinic and welcome to be a part of whatever activities
are involved in our prosthetic clinic. 

Mr. MICHAUD.  Thank you.  My other question.  As you
know, we invest a significant amount of funding into the
VA for fabricating prosthetics.  Do you believe it is more cost effective for
the VA to consolidate prosthetics fabrication internally within the VA, or is
it more
cost‑effective to continue to rely on contracts? 

Dr. PETZEL.  Congressman Michaud, let
me first say that I think it is essential that the VA retain the capacity to
fabricate and to fit prosthetic limbs.  We must be able to do that.  And quite
frankly, in years passed, I think that our capacity to do that had really
slipped.  And I must say that over the a last 7 or 8 years, the VA has
improved its capacity to do both fitting and fabrication. 

The question about whether or not the VA can
do it less expensively than the private sector I think remains unknown.  The IG
had a limited amount of data to look at and made a statement that it was less
costly to do it within the VA than it was in the private sector.  But I think
we would all have to agree that there was not all of the sufficient data to
make that comparison.  My personal belief is that it is more cost effective,
but we need to have all the data to say that definitively. 

Mr. MICHAUD.  I see I am running out
of time, so thank you very much, Madam Chair.

Ms. BUERKLE.  I now yield to the
gentleman from Tennessee, Dr. Roe. 

Mr. ROE.  Just a couple of very quick
questions.  The idea, the reason for doing this was back to what the IG, is
that right, Dr. Petzel, is trying to standardize the procedures, not only in
this but in other areas in contracting that the VA does?  Am I right on that? 

Dr. PETZEL.  To standardize
procurement, not procedures per se, but to professionalize and standardize the
way we procure material.  We have been criticized, as I said, in the past by
important groups of people, including some congressional committees, on our
procurement strategies.  This system wide effort was to try and professionalize
that, yes. 

Mr. ROE.  So I guess what the
chairwoman said is correct.  There is obviously a prosthetist sitting right to
your left.  That is a very individualized therapy.  And I know as a physician,
this has to be tailored per person.  I am sure there is some standardization to
it, and this is not going to, in any way, slow that process down or make that
process not as effective or available to our veterans.  Am I correct on that? 

Dr. PETZEL.  Yes, sir, you are
correct.

Mr. ROE.  And so a patient will be
able to come into the clinic, and that patient won't know the difference.  The
time won't make any difference.  There is not going to be a difference in
timeliness.  The fact that it costs more than $3,000, that is not going to
deflect the time; that that veteran that comes in that needs a limb or a
prosthetic device is going to get that device? 

Dr. PETZEL.  Yes, sir, that is
correct. 

Mr. ROE.  I think that is extremely
important.  Secondly, once you have cataloged, this is there a way to go
outside?  In other words, here is what is in our catalog.  If the doctor and
the prosthetist look at this patient and say, This is what they need, it is not
right in this little book right here, can they get that?  Because this
technology is changing faster than cardiac stints are changing.  It is amazing
the technology now on prosthesis.  As that new technology occurs, it is like
these things right here, as soon as you buy it, it is out of date. 

And so I see the same thing in prostheses. 
People are doing amazing things with this.  Once it goes in the Sears and
Roebuck catalog that Sears has, that the VA has, can that person get something
from the new catalog or something brand new that happens? 

Dr. PETZEL.  Dr. Roe, absolutely.  One
of the nice things about the VA and the procurement regulations is 8123, which
basically says that with the proper justifications, we do not have to do
competitive buying; that we can buy specifically what the doctor has ordered. 

So while we may have a catalog of things that
are appropriate in certain kinds of circumstances, the important part of all of
this is the doctor writes an order, and we will procure for that patient, what
the doctor has ordered. 

Mr. ROE.  So this is not going to
negate new technology that occurs? 

Dr. PETZEL.  Absolutely not.

Mr. ROE.  So our veterans can get the
cutting edge.  They are not going to get stuck in "it's not in the book,
so you can't have it."

Dr. PETZEL.  Absolutely not,
Congressman.  Just to give an example, there are two relatively new knees that
were jointly developed by the VA and the Department of Defense, the X2 and the Genium.  Those are absolutely cutting‑edge technology for an artificial
knee.  They are available to any veteran who needs and wants that kind of a
prosthesis. 

Mr. ROE.  So it is one thing to have
all the colonoscopes look exactly like.  That was one of the issues when I
first got here.  We had that issue that came up.  This is a little different
than that.  I guess the other question I have, and then I will have no more is
that you said that you don't believe that the veterans will be negatively
impacted.  Will they be positively impacted by this?  Will this improve?  I
know the VA feels like it will be positively impacted, but will the veteran be
positively impacted by this, or will they even know the difference? 

Dr. PETZEL.  First of all,
Congressman, they should not know a difference.  It should be absolutely
transparent to them.  But there are a couple of things that I think will happen
that will, even if they don't notice it, improve prospects, I expect that once
we get this up and running and under our belt that we are going to cut down on
the procurement time, on average.  That is number one. 

Number two is that any money that might be
saved by getting a fair price ‑‑ and that is not our
intention, but if that should happen ‑‑ is money that can be
put back into the system to provide more care to more veterans. 

Mr. ROE.  One quick question.  When
will we know that?  When will you evaluate that and know when it goes in and up
and running, a year from now?  Or 2 years from now? 

Dr. PETZEL.  Congressman, I think
there are going to be two different kinds of valuation.  One is that in an ongoing
fashion we have to monitor the things that we described before:  Timeliness,
was a physician's order actually followed 100 percent of time, was there a
level of satisfaction that was appropriate on the part of the patient, the
provider, the doctor, and the contracting officer, and certain other technical
things about the contract.  That is going to be an ongoing process. 

When we have been into this, say, for a year
or 6 months, we will have to look, and we will, look at the overall process and
see what it has accomplished and see if indeed we are doing overall a better
job of purchasing than we were doing before.  So there will be two levels of
evaluation. 

Mr. ROE.  Thank you.  I yield back. 

Ms. BUERKLE.  Thank you.  I am going
to yield myself five minutes for a second round of questioning, if that is okay.  Just a
couple of things.  First of all, I am concerned about a 3‑month pilot
that you mentioned and whether or not that is going to give us the scope of the
situation, and whether or not this is working.  It seems to me that 3 months is
a very short period of time.  And I will let you address that question in a
minute. 

In your opening testimony, you talked about the potential if we find insufficient resources
to have been allocated after
you implement the changes.  What period of time are talking about to evaluate
that? 

Dr. PETZEL.  Madam Chairwoman, let me
answer first the second part of your question.  What I was saying is, if in a
network or at a facility we do not have sufficient,

well‑trained contracting personnel to do this, we won't do it until we
have the resources we need in contracting to do this in a timely, professional
fashion.  And that will occur as we begin to extend this into the other
networks. 

So if there is a network, whatever that
might be, where two or three of the facilities do not have sufficient people,
we won't institute this in those two or three facilities until we have the
appropriate, adequate trained personnel.  That is that I meant to say. 

The first part of your question, and I will
ask Mr. Matovsky to comment on this in a minute, is, were the pilots of
sufficient length? 

There was a run‑up period of
preparation in terms of training, et cetera.  So this was 3 months of actual
doing the work.  And yes, we think we got a good feel for how this worked, what
the issues might be, and what the potential problems might be. 

Mr. Matovsky, do you want to make any comment
about the length of the pilots? 

Mr. MATOVSKY.  We continued running
them after the duration.  So the official time period, we wanted 3 months, but
we continued running them.  As we have concluded, we then standardized the
process for ordering in VISN 6 so that it
conformed to VISN 11 and VISN 20.  And we saw improved performance by using
that new process.  And we really saw it stabilize as well.  So our best
performing month in terms of average timeliness was July, across the board. 

So it was the official time period for the
pilot, and then as it was there and running, we left it running and observed
how it was running. 

Ms. BUERKLE.  Do you know in that
period of time how many actual transactions there were; how many prosthetic
devices were obtained or tried to be procured? 

Mr. MATOVSKY.  I do know that.  I am
not going to find it in my notes right now.  And we can provide it for the
record.  But we do know the specific numbers, yes, ma'am. 

Ms. BUERKLE.  I do want to address a
much broader concern, and that is the question of leadership within the VA with
regard to prosthetics.  As I read through the introductions, and I read Dr.
Beck's introduction, the many hats that you wear, I am concerned that you are acting in multiple capacities, and
there
is not one person focused on prosthetic procurement and the whole prosthetics
issue within the VA. 

If you could speak to direction
of leadership for the VA?  Is this something Dr. Beck will take on herself and
then someone else will relieve her of some of the other duties?  It seems like
Dr. Beck is wearing many hats, I am concerned with regard to the level of
leadership. 

Dr. PETZEL.  Thank you, Madam
Chairman.  You are absolutely right, she is wearing a lot of hats.  Very
talented, incredibly energetic lady, but she has a lot of things that she has
to do. 

I want to ask Dr. Beck to comment in a minute
about leadership in prosthetics.  But I do want to commend the job that she has
done since she has been in that role.  There really has been a palpable change
for the better in the way we do our prosthetics.  I think that Lu has done
really a fabulous job. 

The bench is not as strong as we would like
to have it in prosthetics, so that we can turn most of the operating parts of
prosthetics over to someone else. 

I would like you to make a comment about
that, Dr. Beck. 

Ms. BECK.  Thank you, Dr. Petzel, and
thank you, Madam Chairwoman, for your concern.  I have had a lot of support
from my leadership, up to Dr. Petzel, as I have taken on this initiative.  We
have developed a plan to have a comprehensive office of rehabilitation and
prosthetics.  In that office, we will have a national program director and a
large staff devoted to prosthetics and sensory aid service so that we will be
managing the clinical practices, the procurement and contracting, their
regulatory issues, and the development of all of the programs.  So we have a
plan that is just in the approval stages now that will give us the resident
resources and expertise and leadership roles in the prosthetics office. 

One of the important things that we are
doing, and I think one of the veterans service organizations talked about this
in their testimony, is that prosthetics and sensory aids is a very dynamic
service.  It is an important clinical support service to all of the programs in
VHA.  And so it touches almost every provider, from our primary care teams to
our rehabilitation teams to many of our specialists.  And for that reason we
are linking prosthetics to rehabilitation services so that we can assure that
we have the proper collaboration and coordination under the direction of
Patient Care Services, which is responsible for all of the clinical activity in
VA. 

Dr. PETZEL.  So just to elaborate for
a minute, Dr. Beck would be responsible for rehabilitation services and
prosthetics in the larger sense.  There will be specific leadership in
prosthetics and an office and the staff necessary to administer that program
appropriately.  And that plan, as I understand it, is coming shortly to my desk.
 

Ms. BUERKLE.  That was going to be my
next question; what would be the expectation for implementation of that plan? 

Dr. PETZEL.  Very soon.  I hesitate to
give you a specific date, but I understand the request for people in the
organizational chart is on its way to me.  We will review that, and as soon as
it is signed off on, the process of hiring those people and beginning to do
that will begin.  So the process will certainly begin shortly.  I can't predict
how long it will take to hire the right person, but we will begin shortly. 

Ms. BECK.  I would just like to
reinforce that.  We currently have many very excellent people in the
prosthetics and sensory aids service who are working everyday with me to
accomplish all of our goals, and also to say that in rehab services, we have
defined leadership and subject matter expertise for each of the offices.  So
our physical medicine and rehabilitation office has a physician leader.  So the
leadership, as Dr. Petzel says, in prosthetics and sensory aids service will be
devoted to the clinical support services that we are doing in prosthetics and
sensory aids. 

Ms. BUERKLE.  Thank you very much. 
Just briefly, and then I am going to yield to the ranking member.  You
mentioned that yesterday you had a conference call and that you have been in
touch with the veterans service organizations.  As you recall, at the last
hearing there were grave concerns, and in my opening comments, I expressed the
concerns the VSOs have.  In one of the questions you just answered, you talked
about this ongoing process and you talked about timeliness and physicians'
orders and the contracting officers.  But, again, there is no contact,
there is no connection, there is no ongoing ‑‑ there
doesn't seem to be ongoing communication with the veterans service
organizations, with the veterans themselves.  It is one thing to do this
operation and to look at it objectively, and to look at a plan on paper, but
the most important ones we need to hear from are the veterans who are requiring
this service, because that is what is key here. 

Dr. PETZEL.  Thank you, Madam
Chairman.  Two responses to that.  One is I have ongoing meetings with veteran
service organizations.  We do two things:  Every month I have a breakfast, 2‑hour
meeting with the leaders of the six largest service organizations.  Then every
quarter we have a bigger meeting, again, about 2‑1/2 hours, with a
broader range of service organizations.  And we will keep in touch with them
through this.  It is important to all of them, but particularly the Disabled
American Veterans, the PVA, and the Blinded Veterans.  Prosthetics is an
essence of the service that the members of those organizations need. 

In terms of the veterans, Troy Elam, who was
present, by the way, on the phone call, who had testified earlier, I think said
it at the first hearing, and I had not really heard anybody articulate it quite
as well as she did.  And that is, that we have to have, as part of our ongoing
look at this transition, we have to have a mechanism for asking the veterans
what they experienced, not just with this transition, but with prosthetics
itself. 

Perhaps Dr. Beck could just briefly comment
on the instrument that we are going to use. 

Ms. BECK.  Yes.  Thank you, Dr. Petzel.  The instrument we are going to use is called uSPEQ.  That is an
acronym for the Stakeholder Participation and Experience Questionnaire.  This
is a national benchmarked questionnaire that is used by the Committee on
Accreditation for Rehabilitation Facilities, which is a national organization
that accredits rehabilitation facilities.  We have recently received approval
from the Office of Management and Budget to use that survey to gather
information about satisfaction, and we have arranged a contract which is now in
place with CARF, the acronym for Committee on Accreditation of Rehab
Facilities, and we are beginning the training of our staffs around the country
so that they will be able to implement the utilization of this questionnaire,
not only for amputation and prosthetics care, but for many elements of the
rehabilitative care that we provide in VA. 

One very important aspect of this is that it
is a valid survey.  Data are collected from all facilities all over the
country, not just VA facilities, and we are able to benchmark our care with the
care that is provided across the country related to rehabilitation.  So that is
important for us.  And it is patient satisfaction.  And so it asks the patient
what they think. 

Ms. BUERKLE.  And if I could
respectfully suggest, in addition to the organizations that you are
communicating with, that you would include the newer organizations:  The
Wounded Warrior Project, the IAVA.  It seems to me they should be included in
this discussion and their feedback should be obtained as well.

Dr. PETZEL.  Yes.  Thank you. 

Ms. BUERKLE.  I yield now to the
ranking member. 

Mr. MICHAUD.  Thank you very much, Madam Chair.  In
answering Mr. Roe's question about procurement time, you said it will cut down
on procurement time.  Do you have any idea how much time it
might cut down on the procurement time? 

Dr. PETZEL.  I would, Congressman
Michaud, have to ask Mr. Matovsky if he has any thoughts on that.  I don't. 

Mr. MATOVSKY.  As we were watching the
pilots as they were running in the most recent month in VISN 20, for instance,
our average timeliness was down inside of 3 days to procure, which was pretty
quick.  I think the other thing that we would expect to find, frankly, and it
came out of these pilots, was a collaboration between logistics and prosthetics
so that we could better tune the inventory management process as well.  We will
see how that goes.  We will study that. 

But what that would allow us to do is it
would allow us if we have better visibility into our inventory avoid a

stock‑out situation.  A stock‑out situation is where we run out of
something.  And I think that is where we really have the benefit of being able
to have greater visibility into what we have available and what kinds of
inventory control points would allow us to have a situation where we are
managing at a minimum inventory level.  We are seeing that in VISN 20 in the
Upper Northwest, sir. 

Mr. MICHAUD.  Thank you.  The OIG in
their recommendations recommend that some VISNs contract out between three
and five.  When you look at VISNs that are actually contracting out with
the private sector providers more than the three or five that was recommended, does that
show that there is a greater demand among the veterans community to go to the
private sector, or is that because veterans pretty much in the rural areas are
accessing those, therefore you have a lot of contracts with private providers? 
Or, is the need continuing to increase dramatically? 

Dr. PETZEL.  Dr. Beck, could you take
that? 

Ms. BECK.  Thank you, yes.  The
contracts have been established to provide access, to be sure there was access
close to the patient's home or close to the veteran's home.  And that is the
reason for the large number of contracts that we have had. 

Mr. MICHAUD.  Thank you.  My last
question is in reviewing your testimony, Dr. Petzel, you stated that VA is
instituting more audits of purchases to ensure that we are getting the best
value for our dollars when we procure prosthetics or other devices.  Can you
tell me how many more audits you are doing now compared to before, who is
performing those audits, and who is analyzing those audits as well as the types
of measurements that you are using for those audits? 

Dr. PETZEL.  Let me, in a general
sense, respond, Congressman, then I would ask Mr. Matovsky to provide some
detail.  The things that we are going to be looking at are the things that I
mentioned earlier, was the product that was ordered and delivered, the product
that the physician ordered.  In other words, what is the consonance between
what the physician ordered and what was obtained? 

Timeliness will be an ongoing audit. 
Satisfaction from the point of view of the patient, the physician provider, the
prosthetist, and the contracting officer will be an ongoing audit.  In the
cases where we use 8123 where we don't have to be competitive, was there an
adequate justification for a noncompetitive acquisition, et cetera.  Those are
the things that we in an ongoing way are going to audit.  In terms of how
frequent we are going to be doing that, I would turn to Mr. Matovsky for a
comment about that. 

Mr. MATOVSKY.  We will be running
those every month on a cycle.  We run within VHA two systems of audits that
occur every month and then the Department, under Mr. Heard, has another audit
that comes in and reviews.  Ours is probably a little bit more tactical than
the Department's. 

We look at primarily two things:  First,
where there is a justification for other than full and open under FAR part 6
using 8123, did the contracting officer comply with the prescription?  That is
number one.  Number two, we are looking at other elements that are procurement

reform‑oriented.  Is there an adequate work‑up for the justification? 
Was there a price negotiation performed?  Et cetera.  And those are the things
that we are looking at. 

Over time, I think where we would see
additional efficiencies, at this point theoretical; again, the most important
thing, did we conform to the 8123 justification?  But over time, looking at
things where we are buying many things repeatedly without a covering contract
using 8123, do we have an opportunity to structure an agreement there.  And I
think those are the ones that we would look at over time. 

But to your question, every month it cycles
through the VISN level contracting manager, every month it cycles through the
VHA system of national audits.  I review every month in detail one of our
VISN's contracting results.  This is one of those results I now review.  Mr.
Doyle, who is here, also reviews through his system the audit results. 

Mr. MICHAUD.  Thank you.  I have no
more questions.  Thank you. 

Ms. BUERKLE.  I am going to yield
myself another 5 minutes, and then if Mr. Michaud has other questions, he may
ask them.  We keep talking about the contracting officer.  What is a
contracting officer? 

Dr. PETZEL.  I would ask Mr. Heard if
he would, please, Madam Chair, to answer that question. 

Ms. BUERKLE.  And if you could speak
to their qualifications, their training, and the agreement they have.  Because
initially, I heard there would be a 100 percent compliance with the
physician order for the prescription.  Now I am hearing that is going to be
monitored.  Does the contracting officer have any discretion, or why wouldn't
he adhere100 percent of the time the physician's prescriptions for
which a prosthetic device is being prescribed for the veteran? 

Mr. HEARD.  Sure.  Madam Chair, we
have to look at the acquisition workforce first to determine what their
qualification skill‑sets are.  Going back to 2000, the Clinger‑Cohen
Act that went into place actually professionalized the acquisition workforce by
putting a positive education requirement in place.  That positive education
requirement for a GS‑12 or below is either a degree in any field of study
at an accredited college, or 24 hours of business.  At a GS‑13 and
above, it requires both an

undergraduate degree and 24 hours of business.  The Clinger‑Cohen
Act also required experience and also training to be an integral part of that
acquisition professional contract specialist requirement. 

The actual warranting of a contracting
officer, that is a delegation.  A delegation is based on a need defined by the
head of a contracting activity.  In the VA, there are six heads of contracting
activity.  For Veterans Health Administration, which oversees all of the
hospital acquisitions, including prosthetics, that HCA is Norb Doyle, who is
here.  Norb is designated by the senior procurement executive for the
Department of Veteran Affairs, Jan Frye.  The warranted contract individuals
that are identified based on a need have to show and demonstrate their
experience, their education, and training. 

Training is also a very elaborate criteria
requirement that was identified by OMB back around 2007, called the Federal
Acquisition Certificate in Contracting.  Those individuals climb to a level of
FACC level 3.  Again, a very rigorous, robust education training requirement, a
curriculum identified by the Federal Acquisition Institute.  Once you are
certified, you are eligible for a warrant at various levels. 

Our level 1 warrant holders probably have the
lesser amount of training, but they can be warranted up to $150,000.  That is
commensurate with the simplified acquisition threshold.  So these are warranted
individuals that are warranted on behalf of the Federal Government to act as an
agent to procure on behalf of the Federal Government to ensure that contracts
are awarded with a fair and reasonable price, to seek competition, to comply
with the FAR and the VAR. 

Prosthetics is a unique requirement.  We are
really identifying special needs for our veterans.  Those requirements can be
anything, as we talked about today, artificial limbs, but also products that
are also commercial in nature, which could be walkers, canes, and crutches. 
Some of those are available commercially.  They are obtained off Federal supply
schedules.  But then the others are really very specific to the surgery that is
required for a veteran or other therapeutic requirements. 

Ms. BUERKLE.  So why wouldn't there be
automatically 100 percent compliance with a physician's order?  Why is
that even a concern?  You are talking about someone with a bachelor of science
degree who maybe has 24 hours of business classes, that they have discretion
to override or to not comply with the physician's order with regard to the
prosthetic? 

Dr. PETZEL.  Madam Chairwoman, I can
just take that for a moment, first, and then we will see if either Mr. Heard or
Mr. Matovsky have anything to add. 

The issue there is fair and reasonable
price.  That is their only responsibility in that case, would be to ensure that
in purchasing that specific thing that the physician has ordered, that we are
getting a fair and reasonable price.  And that might entail negotiating with that
provider ‑‑ with that prosthetic provider. 

Ms. BUERKLE.  So I guess I am concerned, because if there is a
prosthetic available that is maybe less money, are we looking at the quality,
are we looking at the prosthetic itself, or are we just negotiating a price about the same ‑‑



Dr. PETZEL.  We are negotiating, in
this case, a price, Madam Chairwoman, around the specific thing that the
physician has ordered.  That is what determines what we buy.  The contracting
officer's responsibility is to see that we get a fair price for it.  But when
he is not going to be, or she is not going to be buying something different
because it is less costly.  Again, we look at what was the physician's order,
and that is what we buy. 

Ms. BUERKLE.  So you would expect
100 percent compliance with the physician order? 

Dr. PETZEL.  Absolutely.

Ms. BUERKLE.  Do you have any further
questions? 

Mr. MICHAUD.  No.  That is a good way
to sum it up.  I think it is very important that the physician is the one
who decides, so I do want to thank you, Dr. Petzel, for all that you are doing
to help our veterans, as well as the other three panelists here today for your
efforts in this regard, so thank you very much. 

Ms. BUERKLE.  I thank the ranking
member, and I also want to thank the panel for being here this afternoon.  I,
again, would just like to ask, I think it is very important that we get as many
veterans' service organizations involved in this discussion, as many
perspectives as possible.  You know, what you have mentioned, with all due respect, is
great, but I think we have got additional veterans' service organizations that
need to be included in this discussion and to make sure there is nothing more
important than the veterans and making sure when they come home without a limb
because they have served this Nation, that they have what they need, that they
are not dealing with some contracting officer who has got some discretion to
give him less of a device than he deserves.  So that is all of our concern
here- that we get our veterans exactly what they need. 

We heard the last time from veterans who
talked about ‑‑ we are talking about-the ability of someone to walk
his daughter down the aisle.  We are talking about intensely personal
prosthetics and an intensely personal segment of the care that our veterans
need, so there is nothing more important. 

And while we are all concerned with regard to
costs, that we make sure our veterans who have served this Nation get exactly
what they need so they can return
to their maximum potential after they have sacrificed so much for this Nation. 

With that, I ask unanimous consent
that all members have 5 legislative days to revise and extend their remarks and
to include extraneous material.  Without objection, so ordered. 

Before I close the hearing, I would like to
make a request that you submit to this Health Subcommittee and to the Veterans'
Affairs Committee the plan that you are talking about.  We would like to see that to make sure that the
veterans' best interests are served. 

Dr. PETZEL.  We will do that, Madam
Chairwoman. 

Ms. BUERKLE.  Thank you, again, to our
witnesses for being here, to our audience members, and to the subcommittee
members, to my ranking member, for joining in today's conversation. 

This hearing is now adjourned.

[Whereupon, at 5:33 p.m., the subcommittee
was adjourned.]



APPENDIX


Prepared Statement of
Chairwoman Ann Marie Buerkle

Good
morning and welcome to today’s Subcommittee on Health Hearing, “Optimizing Care
for Veterans with Prosthetics: An Update.”

Today’s
hearing is a continuation of a discussion we began almost three months ago when
this Subcommittee heard from veterans with amputations, members of our veterans
service organizations (VSOs), and officials from the Department of Veterans
Affairs (VA)  to review VA’s capability of delivering state-of-the-art
prosthetic care to veterans with amputations and the impact of VA’s planned
prosthetic procurement reforms. 

These
reforms will, among other things, take prosthetic purchasing authority away
from prosthetic specialists and transfer it to contracting officers.

As
our veterans so eloquently described in May, prosthetic care is unlike any other
care that VA provides and, when we make the mistake of treating it as such, no
less than the daily and ongoing functioning and quality of limb of our veterans
is at stake.

I
was very troubled to hear our veterans voice such strong opposition to the proposed
procurement reforms, arguing forcefully that they would lead to substantial
delays in care for veterans with amputations and clinical judgments regarding
veterans needs being overridden by individuals with little to no experience in
prosthetic care.

In
mid-June - following our hearing - I sent a letter, along with Ranking Member
Michaud, to the Secretary requesting that the Department respond to a number of
questions and provide certain materials regarding the strategy, plans, and
criteria used to consider, develop, design, implement, and evaluate the
proposed reforms and the pilot programs that preceded them.

Our
goal was to understand the analysis VA employed to develop the reforms and what
was behind the decision that this was the best idea for our veterans,
especially those who have experienced loss of life as a result of service to
our country.

Sadly,
the Department’s response – which came a week after the deadline requested in
our letter – did not provide the information or the level of detail we asked
for and did nothing to assure me that the plan would be effective or that our veterans
concerns were unfounded.  

To
the contrary, a close review of the materials VA provided leads me to believe that
the reforms were developed without careful and thorough consideration. It leads
me to believe they were developed without sufficient input from veterans
themselves, veteran service organization advocates, or other stakeholders.

It
leads me to believe that they were developed and implemented, after being tested
for a very short time, at a small number of locations, with very limited
feedback.  It leads me to believe they were developed without adequately
measuring their impact on patient care. It leads me to believe they were
developed without safeguards in place to ensure veterans and clinician’s wishes
are respected and timeliness goals are met.

It
is concerning that VA would move forward with instituting large-scale changes that
so directly impact veteran patients in this way.  If my concerns are groundless
– and I hope that they are – I want VA, in explicit detail, to explain why.

During
our last hearing, our veterans and VSOs spoke loud and clear. Now it is time for
VA to do the same.

Again,
I thank you all for joining us this afternoon. I now recognize our Ranking
Member, Mr. Michaud for any remarks he may have.

PREPARED STATEMENT OF HON. ROBERT A. PETZEL, M.D.

Chairwoman Buerkle, Ranking Member Michaud,
and Members of the Subcommittee:  thank you for the opportunity to speak about
the Department of Veterans Affairs’ (VA) prosthetics procurement reforms.  I am
accompanied today by Mr. Philip Matkovsky, Assistant Deputy Under Secretary for
Health for Administrative Operations, Veterans Health Administration (VHA); Dr.
Lucille Beck, Chief Consultant, Rehabilitation Services, Director, Audiology
and Speech Pathology, and Acting Chief Consultant, Prosthetics and Sensory Aids
Service, VHA;and Ford Heard, Associate Deputy Assistant Secretary,
Office of Acquisition and Logistics.

VA testified before this Subcommittee and the
Subcommittee on Oversight and Investigations in May 2012 regarding our efforts
to maintain the high quality of prosthetics VA provides to Veterans while
instituting reforms to improve compliance with the Federal Acquisition Regulation
(FAR), the Competition in Contracting Act, and to improve our management of
government resources.  In follow-up to those hearings, the Chairwoman and
Ranking Member submitted a letter to the Department on June 21, 2012,
requesting a response by July 6, 2012, that would offer additional information
about these reforms.  On July 12, 2012, VA submitted information to the
Subcommittee on Health to begin to address the Subcommittee’s request.  Our interest
was in responding as quickly as possible to your request, and we regret our
submission of July 12, 2012, did not sufficiently address your concerns. 

You also have asked for an update on the
actions the Department has taken to reform the prosthetics procurement process
since the May hearings.  I am pleased to report that on May 23, 2012, VA issued
a Memorandum to the field advising them that it is VA’s policy that those
engaged in the ordering of biological implants comply with the FAR and VA
Acquisition Regulation (VAAR).  This Memorandum provides further information
and guidance to staff to ensure they understand our objectives and procedures. 
That Memorandum states that the VA official performing the purchasing activity
is to comply with a physician’s prescription when it is indicated. 
Furthermore, in response to your advice to transition our warrant procurement
program with deliberation and caution, VA extended the date for finalizing this
transition from July 1 until September 30, 2012. This transition continues with
ongoing communication and coordination with the Veterans Integrated Service Networks
to ensure that procurement services are not disrupted.  We are closely
monitoring the staffing levels for our contracting organizations, the workload
levels, and most importantly, the timeliness of the procurement actions.

Finally, you asked me to address the
potential impact these prosthetics procurement reforms could have on Veterans. 
As we testified in May, we do not believe that Veterans will be adversely
impacted in any way.  We believe that many of our reform efforts are acceptable
to all concerned parties.  For example, VA is instituting more audits of
purchases to ensure that we are getting the best value for our dollar when we
procure a prosthetic or other device.  We also will begin tracking our
purchasing trends to identify when and where we can enter into negotiated
contracts.  Further, we are streamlining and standardizing elements of the
procurement process to reduce variation and accelerate purchases so Veterans
can receive their devices and equipment faster.

The proposals that have raised interest are
our plans to standardize the purchasing of prosthetics and other devices, and
our plan to transition procurement decisions to warranted contracting
officers.  On the first plan, many of the products VA purchases are either
going to become a part of a Veteran or will be a critical part of their daily
lives, helping them walk, work, and interact with their families.  We
understand the critical value these devices offer, and the independent clinical
judgment of our providers will remain fully intact.  This aspect guides the
decision-making of our leadership and will be preserved in our policies and
procedures.  Clinicians, in consultation with Veterans, will decide what
devices we procure.  Our reforms are designed only to modify how we
procure them.  When products are generally available and interchangeable,
competitive procurements may be appropriate, and we are hoping that in the long
term we can develop a catalog that will facilitate, more cost effective
purchasing decisions. 

On the second plan, concerning the
transitioning of procurement decisions, I again emphasize that this is only
changing how we purchase, not what we purchase.  By shifting to contracting
specialists, we can ensure that we secure fair and reasonable prices for
products while still delivering state-of-the-art care. 

In conclusion, VA has been engaging in
prudent and appropriate reform to improve the business processes governing the
procurement of prosthetic devices for Veterans.  We take great care to ensure
that these changes improve the accountability of these purchases while
maintaining the high quality of care and clinical decision making critical to
Veterans’ health care.  Clinicians determine the prosthetic needs of Veterans
as a part of their clinical care, and VA procures the devices necessary to
achieve personal clinical outcomes.  Our reform efforts will not disturb this
arrangement, which will remain the centerpiece of prosthetics care in VA.  We appreciate
the opportunity to appear before you today to discuss this important program. 
My colleagues and I are prepared to answer your questions.

Deliverables from the United
States Department of Veterans Affairs

Date:  August 23, 2012

Source:  Hearing Deliverables    

Inquiry
from: 
HVAC Health

Context of
Inquiry:
 During
the HVAC Health prosthetics hearing three deliverables were noted:

There were
three deliverables from yesterday's prosthetics hearing:

1.  How many
prosthetic devices were procured during the pilot

2.  Please
forward the new organizational plan to merge prosthetics and rehabilitation

3.  Please
provide a timeline for how long it will take to complete the new organization

Response:

Question: 
How many prosthetic
devices were procured during the pilot

Response: 
The table below provides this information.

It is
important to recall that only those purchases above $3,000 will transition to a
VHA Contracting Officer. There are roughly 90,000 prosthetics transactions
executed per year that are greater than $3,000.

Table:
Number of Prosthetics Purchases made by VHA Contracting Officers

  VISN 11 VISN 20 VISN 6 Totals

January

57

131

145

333

February

122

149

224

495

March

263

174

299

736

Subtotal

442

454

668

1,564

 

 

 

 

 

April

268

166

194

628

May

283

207

358

848

June

226

273

314

813

July

(partial month)

149

150

272

571

TOTAL

1,368

1,250

1,806

4,424

Question:  Please forward the new
organizational plan to merge prosthetics and rehabilitation

Response:  Veterans Health Administration (VHA)
has aligned Prosthetic and Sensory Aids Service (PSAS) with the Office of
Rehabilitation Services (ORS), to become the Office of Rehabilitation and
Prosthetic Services.  The reason for this change is to align both
prosthetic and clinical programs together in order to optimally coordinate and
deliver programmatic services, policies, and guidance for medical equipment /
items and medical rehabilitative services that promote the health,
independence, and activities of daily living for Veterans and
Servicemembers.  This realignment of existing VHA resources will further
improve management and oversight of prosthetic purchasing, inventory control,
and clinical coordination in order to better utilize appropriated
resources.  The cost of this realignment is budget neutral, the newly
aligned office will remain within VHA Office of Patient Care Services, and the
administrative processes (e.g., budget, HR, planning and programming, etc) for
PSAS and ORS will be completely aligned by September 30, 2012.

Please see the attached document for a
summary of the plan to merge prosthetics and rehabilitation.

Question:  Please provide a timeline for how
long it will take to complete the new organization

Response:  The Office will be completely
aligned by September 30, 2012.

Summary of Plan to
Merge Prosthetic and Sensory Aids Service and

Office of
Rehabilitation Services

Health Subcommittee,
House Committee on Veterans’ Affairs

Deliverable from July
31, 2012 Hearing

Prosthetic
and Sensory Aids Service (PSAS) is core to the mission of VA and affects
millions of Veterans and Servicemembers on a short-term, long-term, and ongoing
basis.  PSAS should be realigned to most effectively support clinical services
and engineer optimal programmatic policies, guidance, and regulations to
advance the full continuum of health care practices in VHA.  The Office of
Patient Care Services will merge with the Office of Rehabilitation Services
(ORS) and become the Office of Rehabilitation and Prosthetic Services in the
Office of Patient Care Services. 

This
alignment will improve management and oversight of prosthetic purchasing,
inventory control, and clinical coordination in order to better utilize
appropriated resources.  Transition of PSAS under ORS, with appropriate
staffing, will position VHA to most effectively accomplish that mission.  The
Prosthetic and Orthotic Program will be aligned as a separate clinical section
under ORS. 

The
Office of Inspector General (OIG) recently completed reviews, and Congress has
subsequently held hearings regarding concerns about oversight and management of
procurement, inventory management, and prosthetic services in VHA. 
Consequently, the pressing need for improved management, coordination, and alignment
of PSAS within clinical services has become increasingly important. 

The
transition of PSAS to a national program office under ORS will:

·        
Establish
and improve processes for providing prescribed and clinically appropriate,
state-of-the-art prosthetic devices, sensory aids, and equipment in the most
economical and timely manner;

·        
Manage
national contracting processes for prosthetic devices including strategic
sourcing;

·        
Maintain
a system of information management for procurement requests; and

·        
Align
standards of care and clinical practices and PSAS purchasing.

PSAS
does not currently have the appropriate organizational structure or staffing to
support clinical services aligned with programmatic policies.  If PSAS is
realigned with ORS, the resulting programmatic re-engineering of regulations
and policies, contracting processes, clinical prescription practices, budget
accounting, information technology, and reallignment of key staff will:  (1)
leverage pre-existing infrastructure and resources and (2) identify and
mitigate vulnerabilities. 

Dr.
Lucille Beck, Chief Consultant, will lead this realignment and the Office of
Rehabilitation Services will become the Office of Rehabilitation and Prosthetic
Services (OR&PS).  Implementation of this realignment will commence, with
initial organizational restructure completed within 30 days.  Personnel
recruitment actions will be initiated to fill existing personnel vacancies. 
The existing PSAS budget will be realigned under OR&PS, with accountability
fully transitioned by the beginning of fiscal year (FY) 2013. 

The
success of this realignment will be monitored through a number of strategic
outcomes, including:  improved timeliness in providing prescribed items to
Veterans; increased numbers of national contracts and compliance with
contracts; compliance and accuracy in recording and tracking serial numbers of
critical items (e.g., surgical implants); accurate budget execution to ensure
appropriate allocation for specific purpose funds (i.e., prosthetic items, devices,
and equipment) and balance of expenditures to obligations; and implementation
of data accuracy monitors to track and compare issuance codes for consistency
across national averages.  Further, programmatic policies, regulations, and
processes for prosthetic services will be aligned with those of clinical
services to improve consistency and continuity of services to Veterans--from
clinical prescription, to procurement, provision, and verification of receipt of
appropriate prosthetic items.