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Today, Rep. Matt Rosendale (R-Mont.), the Chairman of the House Committee on Veterans’ Affairs Subcommittee on Technology Modernization, delivered the following opening remarks, as prepared, at the start of the subcommittee’s oversight hearing entitled, “VA’s Open Cash Register: Fraud, Waste, Abuse and Revenue Operations,” which will examine the Department of Veterans Affairs’ (VA) struggles to operate IT systems that are key to preventing fraud, waste, and abuse in VA community care payments and collecting insurance payments and copays, including the Program Integrity Tool through the Veterans Health Administration:

Good morning.

The Subcommittee will come to order.

I want to welcome our witnesses to discuss the Program Integrity Tool and other important systems that VA uses to manage community care payments.

The Program Integrity Tool (PIT) consolidates all community care claims payment data in one place.

The Veterans Health Administration uses it to do two important things:

• First, to prevent fraud, waste, and abuse when paying community care providers’ claims.

• Second, to bill and collect for non-service-connected care.

When care is not service connected, VHA is responsible for billing the veterans’ insurance companies, or in some instances the veterans for copays.

These medical collections, over 90% of which are insurance company billings, are an important part of the budget that pays for care for other veterans.

Without PIT, VA is essentially operating an open cash register.

There are no controls on the cash coming out of the register, and the cashier isn’t collecting the change and putting it back in.

That was essentially the situation beginning in February 2023 when the technical defects in PIT became overwhelming and VA had to turn the system off.

To some degree, that is still the situation.

The Office of Inspector General estimated more than $665 million in revenue was not collected—most of which is owed by insurance companies—and millions of dollars of fraud, waste, and abuse went undetected.

VA struggled to get PIT working again until July of this year, and it’s still not clear whether all the problems can be resolved.

This has been an 18-month struggle marked by unsteady leadership, questionable decision making, and terrible contractor performance.

And the Department has not been eager to answer our questions.

Chairman Bost sent Secretary McDonough a letter on July 30th asking a dozen detailed questions, only to receive a curt response on September 6th from Mr. DelBene dismissing all the questions because a meeting with the Committee staff had taken place.

We still need the answers.

Congress has the constitutional prerogative and duty to ask the Executive Branch questions.

I would like a commitment from VA to respond in full in writing to whatever we are unable to cover today.

We need to determine how exactly the cash register opened up and whether it ever truly closed.

This is even more important given the $12 billion VHA budget shortfall that you have reported for next year.

Only yesterday did VA give us the arithmetic showing what the $12 billion consists of.

We still have a lot of questions about how the numbers were developed, and the Committee staff is expecting a meeting with VA about that next week.

VA has told us that community care is part of the shortfall, but we have received conflicting information about whether delayed medical collections are part of it.

We are slowly getting closer to a complete explanation of the health care shortfall.

In particular, improper payments in community care and billings that VA failed to capture deserve extra scrutiny.

Community care is a $31 billion program, and the improper payment rate is 4.9%.

Not all of that is waste or fraud. About one-third is compliance issues not affecting payment amounts.

But altogether, the improper payments work out to more than $1.5 billion annually.

And the missed collections add up to nearly $1 billion over 18 months.

That’s real money—even in Washington.

As we have said time and time again in this Subcommittee, IT system failures are no excuse to waste taxpayers’ money.

I have no doubt that Congress will get to the bottom of the health care shortfall and prevent veterans’ care from being undermined.

But VA’s leaders need to understand they cannot incite a panic and pressure Congress to bail them out for their mistakes.

Today, our responsibility is to untangle the web surrounding PIT and understand the true impacts on the budget.

With that, I yield to Ranking Member Cherfilus-McCormick for her opening statement.