Stronger Financial Management Practices Are Needed at VA's Maryland Health Care System

Sound financial management practices at VA facilities are critical to ensure funds are used appropriately, effectively, and efficiently. For that reason, the VA Office of Inspector General (OIG) conducted a review to examine whether VA’s Maryland Health Care System appropriately managed purchases and payments for medical equipment and supplies. Fiscal oversight of purchase cards and internal controls governing the use of overtime were also reviewed. The OIG found ineffective processes, internal control weaknesses, and inadequate oversight in five areas: 1. The healthcare system and the Enterprise Equipment Request (EER) portal need improved controls for approving equipment purchases. 2. Healthcare system staff and the prime vendor should prepare timely and accurate planning information to ensure adequate supplies are on hand to fill orders. 3. Even though no inaccurate inventory payments were identified, VA’s inventory system needs controls to ensure correct recording of supply units and costs. 4. The healthcare system purchase card program requires closer monitoring to ensure purchases are authorized and supported by documentation. 5. The healthcare system should strengthen its overtime payment controls to ensure supervisors verify overtime hours were completed before approving timecards for payment. VA concurred with all eight OIG recommendations. The OIG team also identified more than $5 million in questioned costs related to identified issues such as undocumented or unapproved purchases.