THE HONORABLE HERSHEL W. GOBER
DEPARTMENT OF VETERANS AFFAIRS
SUBCOMMITTEE ON OVERSIGHT AND INVESTIGATIONS
COMMITTEE ON VETERANS' AFFAIRS
U.S. HOUSE OF REPRESENTATIVES
October 28, 1999
It is my pleasure to testify on behalf of the Department of Veterans Affairs (VA) on the status of our readiness for the Year 2000. I am accompanied today by Harold Gracey, VA’s Acting Chief Information Officer (CIO), and other key staff from VA’s Office of Information and Technology, the Veterans Benefits Administration (VBA), the Veterans Health Administration (VHA), and the National Cemetery Administration (NCA) who have been involved in Year 2000 full-time for the last several years.
We have worked very hard in VA to ensure that we will be ready for the Year 2000. We have program delivery people and information technology people working hand-in-hand across VA to ensure that we provide uninterrupted support of benefits delivery and health care services.
I appear before you today to say I remain confident that benefit payments will be made without interruption, and our health care facilities will be operational on January 1, 2000. Veterans will continue to receive their benefits on time, as well as the highest quality of health care in the Year 2000 and beyond.
Since the last hearing VA has conducted a number of post-implementation tests to provide added assurance that our systems will operate properly in the Year 2000. VA has utilized Year 2000 simulated date environments, complete with third-party compliant software and hardware, to simulate system activity during the century transition and in the Year 2000 and beyond.
One major accomplishment was the successful completion of a business process simulation (BPS), conducted from July 3 - 6, 1999. During these tests, VA systems internal date settings were advanced to January 2000, including veteran data, software applications, communications and computer platforms. Benefits and health care transactions were processed in order to simulate normal business activities in the Year 2000. Over $3.5 billion dollars in benefit payments were successfully processed in the simulated January 2000 payment cycles. Over 125 VA personnel participated in this test. No Year 2000 problems were encountered during the simulation
VA has also conducted additional post-implementation tests. Previously, in April 1999, VA’s Office of Financial Management performed a series of tests to verify that the various systems involved in issuing payments to vendors and employees will work together properly in the Year 2000. In addition, in August 1999, VHA’s VISTA integrated suite of applications was tested in a simulated forward-dated hospital environment to simulate normal medical center activity in the Year 2000. VISTA is the name given to the standardized set of national software applications that form the automated systems environment supporting integrated health care delivery at local VA health care facilities.
Business Continuity and Contingency Plans
Although VA has made its systems Year 2000 compliant, there remains a dependency upon products and services provided by third parties (such as water and electricity companies). VA has developed Business Continuity and Contingency Plans (BCCPs) to minimize Year 2000 impacts on its core business functions.
In the event of any problems external to the Department, VA has classified its core business functions into two critical areas: health care (VHA) and benefits delivery (VBA). The BCCP for benefits delivery, including benefit payments, was completed in January 1999. The Patient-Focused Year 2000 Contingency Planning Guidebook, VHA’s BCCP, was completed in March 1999.
VA’s regional offices and health care facilities were provided these plans and templates so that they could customize their individual plans according to their local needs. The customized extensions for VA’s three data processing centers, 58 regional offices, and 172 health care facilities were completed in May 1999. VA health care facilities include hospitals, outpatient clinics, domiciliaries, and nursing homes, all of which have been included in local level BCCPs. These BCCPs will greatly mitigate the potential impacts on the delivery of benefits and health care by entities outside VA’s control.
Day One Planning
Our focus in the remaining days until the actual date rollover is making pre-rollover, rollover and post-rollover plans, commonly referred to as Day One Plans. VA has developed Day One Plans that identify comprehensive sets of actions to be executed during the last days of 1999 and the first days of 2000. The Day One Plans are designed to minimize any adverse impact on operations and key business processes, help protect data, applications and equipment, and improve the ability to recover should Year 2000 related problems be encountered. In addition, the Day One Plans are a mechanism for monitoring and reporting VA’s Year 2000 experience to VA executive management, the President’s Council on Year 2000 Information Coordination Center (ICC), veterans and their families.
VA has developed a Day One Strategy Overview that provides a high level summary of VA’s strategy to manage and mitigate the risks of potential Year 2000 related disruptions to agency operations. I would be happy to provide a copy for the record.
Because VA’s work supporting health care and benefits delivery is normally conducted at the local level nationwide, the authority to solve rollover problems has been delegated locally to the health care facilities, and to the regional offices. Local facilities and regional offices have the authority to execute appropriate contingencies, if they determine that a situation exists that requires the execution of the BCCP.
VA’s recent focus has been the review and validation of our BCCPs at our local facilities. VHA has been performing a series of BCCP site visits to ensure the quality of BCCPs and preparations for Day One. Similarly, VBA has reviewed regional office BCCPs and Day One Plans. In addition to internal reviews, GAO, using on-site visits and document reviews, has reviewed many of VA’s health care facilities and regional office BCCPs. VA’s Office of the Inspector General has also completed a written survey of all VA facilities, and has performed selected site reviews at VA health care facilities and regional offices.
As described in my April 15, 1999, testimony, it is important to point out two mitigation and preparatory activities that VA has completed or plans in order to help minimize potential Year 2000 disruptions to benefits and health care delivery – the date of benefit payments and the performance of emergency power drills.
Date of Benefit Payments
Most of the regular, recurring benefit payments, including Compensation and Pension, Education Chapters 32, 35, 1606, Vocational Rehabilitation, REPS, and spina bifida will be posted, as they normally would have been, to the beneficiaries’ accounts and will be available on the morning of December 30, 1999. This will greatly mitigate possible Year 2000 interruptions of benefit payments.
Conduct of Emergency Power Drills
Each VHA facility has performed an emergency power drill to prepare for various power disruption scenarios. Each facility, under controlled conditions to prevent any harm to patients, supplied facility electrical power using the emergency generator system after disconnecting from the local electrical power supply for up to eight hours. This drill demonstrated that health care facilities could operate under emergency power, if necessary. Drills were completed by August 1999.
Department of Treasury Testing and Payment Contingencies
In May 1999, VBA conducted extensive Year 2000 testing that culminated with the transfer of payment files to the Department of the Treasury. During this testing, over 35 payment files representing over $3.5 billion dollars were transmitted to the Treasury. The Treasury informed us that these payments were processed correctly. The Treasury then tested the Compensation and Pension (C&P) files with the Federal Reserve and 40 million C&P Electronic Fund Transfer payments were successfully processed. In addition, Treasury successfully tested its ability to process and issue paper checks currently made to beneficiaries.
In addition, we have several contingencies in place with Treasury in the unlikely event of a problem. In fact, an entire subset of our BCCP for benefits delivery deals with Treasury issues to ensure that beneficiaries will receive their benefit payments on time and correctly when the new century begins. These plans include a worst case scenario in which the private banking electronic systems fail or have problems. If this occurs, Treasury can revert to the use of paper checks to deliver veterans payments after recertification of those payments by VA. In addition, if the VA systems cannot process payments in January 2000, we will provide a contingency payment file for Treasury's use so that they can generate veterans' payments. We feel these are unlikely events, but we are ready with contingencies in case they are needed.
Based on the fact that both VA and FMS and the Federal Reserve System are already Year 2000 ready, and that we have thoroughly conducted post-implementation testing, I am confident that all benefit payments will be made without interruption in the Year 2000 and beyond.
The potential Year 2000 impact on medical devices is a national issue, affecting both private sector and Federal health care communities. VA, like any other health care provider, buys these devices from private industry. The Food and Drug Administration (FDA) regulates these products.
Medical Device Status
Approximately two years ago, VHA identified about 1600 vendors from which the medical facilities have procured medical devices. This number was reduced to 1379 through research, discussion with medical engineers at VAMCs, and contact with vendors/distributors. Distributors and manufacturers that do not produce biomedical devices were removed from the database. To date, we have received responses from more than 99% of the manufacturers.
VHA estimates that over 96% of the devices provided by these manufacturers that we use are compliant, about 3% are conditionally compliant (meaning a fix or upgrade will be provided by the manufacturer) and less than 1% are non-compliant.
Consolidated Mail Outpatient Pharmacy (CMOP)
The Consolidated Mail Outpatient Pharmacy (CMOP) is a regional system composed of seven facilities that is used to expedite the processing and distribution of mail-out prescriptions to veterans. More than 50% of VHA prescriptions are filled by the CMOPs.
As of September 30, 1999, VHA had completed the Year 2000 repairs and testing of the seven CMOPs. The renovation strategy consisted of the repair of non-compliant systems as well as the implementation of new systems. Two of the seven CMOPs are now running new non-proprietary, state-of-the-art software that operates on a more user-friendly, fully compliant platform and thus are capable of filling a higher volume of prescriptions. All the CMOPs renovation work was performed without compromising the filling and distribution of prescriptions to veterans.
As part of the VHA Year 2000 project, the CMOPs have developed Year 2000 contingency plans to supplement their existing National Disaster and Recovery plans. The CMOPs have also tested all the hardware, software interfaces, and contingency plans with the medical facilities. The contingency plans address the pharmaceutical supply chain, and the readiness of pharmaceutical manufacturers, utility companies, and other suppliers the CMOPs depend on for their operation.
The CMOPs are fully Year 2000 compliant and we are confident there will be no interruption in filling prescriptions for veterans into the next century.
VA has established a nationwide moratorium on the implementation of new systems, changes to existing systems or third-party upgrades between October 15, 1999 and March 31, 2000. Our goal is to ensure that we do not introduce Year 2000 vulnerabilities or defects into our Year 2000 certified systems. The only exclusions to the moratorium are changes to correct Year 2000 related problems, repairs for other production problems, cost-of-living adjustments, and changes required by legislative mandates. This nationwide moratorium ensures that our information technology environment will remain stable during the rollover to the next millennium and beyond. It is necessary to ensure that VA will continue to provide uninterrupted services to veterans and the communities that we serve.
VA has made its systems supporting health care and benefits delivery Year 2000 compliant. VA has completed successfully the necessary testing for both the veterans’ benefits and high impact health care programs, and we feel confident that these programs are ready for the Year 2000 and beyond. VA also has completed BCCPs to provide for uninterrupted health care and benefits delivery.
VA is making preparations for the upcoming Year 2000 date rollover to ensure benefit payments will be made without interruption and that VA health care facilities will be operational on January 1, 2000 and beyond. Our Nation's veterans and their families will continue to receive their benefits on time, as well as the highest quality of health care. I thank you for this opportunity to present our progress in preparing for the Year 2000. I would be happy to answer any questions you have.