TRANSCRIPT: Secretary McDonald Press Conference Outlining The Road To Veterans Day

Sep. 8, 2014, 08:00:00 AM

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WASHINGTON – Today, Secretary of Veterans Affairs Robert A. McDonald held a press conference at VA’s Washington, D.C., headquarters where he shared observations from his travels to VA facilities over the past month and outlined the way ahead as The Road To Veterans Day.

A transcript is below. A link to the fact sheet outlining The Road to Veterans Day is here.

TRANSCRIPT:

SECRETARY McDONALD: Good morning. I'm Bob McDonald. Thank you for coming this morning. I've been looking forward to talking with all of you and this is going to be one of many media engagements going forward.

I want to thank Deputy Secretary Sloan Gibson -- Sloan, if you don't mind raising your hand -- for his leadership as Acting Secretary and for his continued work as Deputy Secretary, and more importantly, for his 40 years of friendship. Sloan and I went to West Point together. We lived next to each other our senior year and the leadership, integrity, ethics, and work that he's brought to this Department has been fantastic and we look forward to working together.

I'm really proud to be a partner with Sloan for this very important work.

I've been on the job now for just over a month and in that time I've seen how we deliver healthcare at our newest hospital in Las Vegas, at a Vets Center, at a mobile clinic in Memphis, and at an outpatient clinic in Charlotte. I've watched the claims process at the Reno Regional Benefits Office and I've seen dedicated workers in Memphis who make that VA cemetery the national shrine that it is.

On Friday, I watched how we care for the most vulnerable veterans at a homeless stand down in Philadelphia. I've talked to schedulers in Phoenix, nurses in Palo Alto, and medical residents in Durham, North Carolina. I've met with academic partners at the University of Pennsylvania and at the Duke University Medical School. I've met union leaders, state and local government partners, and I've spoken to thousands of veteran advocates at four veteran service organization conferences.

With every group I engage, I make this point, at VA, our mission is clear. It is to serve veterans. There is no higher calling than that mission. Veterans are our customers. To me, that means effectively and efficiently providing them the high-quality care and benefits that they've already earned. Everywhere I've gone I've found VA employees overwhelmingly dedicated to our mission of serving veterans. They're enthusiastic to be a part of the solution to our current challenges and they're excited that we have an opportunity to improve care for veterans in ways that didn't exist before. These employees are driven by our strong VA institutional values: integrity, commitment, advocacy, respect, and excellence. All of that is summed up in the acronym, ICARE, represented by the button that I'm wearing today.

Now here's some of what I've heard in my employee townhall meetings. I met Deb in Las Vegas. She works in radiology and has been with VA for ten years. And she's very proud of VA's cutting edge, 3-D mammography technology, but she pointed out that we have to make it easier for medical professionals to come and stay at VA.

In Phoenix, I met Bob. Bob came to VA as a patient. He liked it so much he decided to come and work for us. And some employees tell me about challenges to their efforts to deliver the best care they can. And I always ask for and I want to hear their honest feedback for how we can improve. Whenever I talk with veterans in waiting rooms, as they're having lunch in the canteen, or as I'm simply walking the halls or talking to them in the parking lot, my question to them is the same: how is VA treating you and how can we improve?

In Memphis, I met Harry. Harry is a member of the VFW. He told me that his job allows him to get healthcare anywhere he wants, but for the past 20 to 30 years, he's been getting it at VA because it's the best.

Before I got to the medical center in Palo Alto, I received a note from a veteran who lived in New Jersey. He has a prosthetic leg. While visiting family in California, he went to the Palo Alto Medical Center where the physician told him that his leg was infected. So three time zones away from home, he needed a new prosthetic. The doctor explained how to soak his leg to beat the infection and a week later, he received a new fabricated prosthetic leg from the Veterans Administration there in Palo Alto. Every day, in every VA facility, physicians take ownership of their patient needs and treat them with dignity and respect.

And I've talked to family members. There was Dottie in Las Vegas. She, her son, and her daughter-in-law told me that the local community emergency room wouldn't take her husband in when he was quite ill. So they went to the VA emergency room and as she said it, "VA saved his life." Her message was simple. "Thank you. Keep it up."

Time and time again, I've heard patients call their nurses angels and tell me that their doctors understand the needs and give great care. But I also hear that veterans are waiting too long to be seen and that is simply not acceptable. And I'm hearing from those who have experience the worst of the bureaucracy. For example, one veteran told me that it will still take as long as a year for VA to verify her dependency status for benefits even though she's been receiving tuition assistance from the VA. One widow said that she received a call from VA to remind her veteran husband to get his flu shot. And her husband had passed away months before. A family member shared that VA sent a letter to his veteran father to enroll in VA healthcare and his father had passed away 20 years ago and was buried by VA.

That's why we're looking at every service we provide, every customer interaction we have, every single thing we do through the eyes of the veteran. We want to look at everything we do through the lens of the veteran. That perspective makes every decision, every right decision absolutely clear.

I want to personally apologize to all veterans who experienced unacceptable delays in receiving care in Phoenix, Arizona or across the country. I said at my confirmation hearing that I will put veterans at the center of everything we do at the VA. So I'm working to right the wrongs and institute reforms to transform a modernized VA to better serve veterans and I'm committed to fixing the problems and consistently providing timely and high-quality care veterans have earned and veterans deserve. That's how we'll begin regaining veterans' and the American people's trust.

Over the past months, we've been taking a hard look at ourselves, listening to veterans, listening to employees, listening to VSOs, veteran service organizations, members of Congress, and our other partners. Their insights have been invaluable. And we're using their insights to chart our path moving forward.

To address our immediate challenges, over the past several months we've prioritized efforts to get veterans off wait lists and into clinics. We've added more clinic hours. We're recruiting additional staff, deploying mobile medical units, and having high-performing facilities share their best practices to help facilities all over the country rise to a higher level of improvement.

Our people are making a difference. Nationally, they've enabled the following critical achievements: as of September 5th, VHA, the Veterans Hospital Administration, has reached out to over 294,000 veterans to get them off wait lists and decrease the number of veterans on the electronic wait list by 57 percent. VA has developed the accelerating care initiative to increase timely access to care for veteran patients, decrease numbers on the electronic wait list longer than 30 days. We've increased community and non-VA care. Between May and September 5th, we've made almost a million referrals for non-VA care; over 246,000 more than the same period in the year 2013.

The 14-day access measure was removed from all employee performance plans to eliminate incentives for inappropriate scheduling. Over 13,000 performance plans were amended.

We are simultaneously updating our antiquated appointment scheduling system and working to acquire a comprehensive, state-of-the-art, commercial off the shelf scheduling system.

VA medical center directors and network directors are completing face-to-face audits of their facilities and their scheduling practices to be completed by the end of the month. So far, we've conducted over 3,000 of these audits nationwide.

We're restructuring VHA's Office of the Medical Inspector to better serve veterans and to create a strong internal audit function.

We're building a more robust continuous system for measuring patient satisfaction to provide real time, site specific information, collaborating with veteran service organizations in an effort and learning what other leading healthcare systems are doing to track patient access experiences.

And based on the valuable feedback I've received from my travels, I directed VA healthcare and benefits facilities nationwide to hold townhall meetings by the end of September to improve communication with and hear directly from veterans. VA is all about veterans. It's the only reason we exist. We need to become more focused on veteran needs and recognize and reorganize around the idea that we want every veteran in this country to think of VA as their VA. In other words, we want them to call it my VA.

We're working hard to create and sustain a climate that embraces constructive dissent, that welcomes critical feedback, and that ensures compliance with legal requirements. That climate mandates commitment to whistleblower protections to all employees. In fact, I've told employees that I want every employee to criticize what we do, help us improve, and everybody to become a whistleblower in their own way of helping us on this road to improvement.

We've established an inter-disciplinary accountability review team to ensure leadership accountability for improprieties related to patient scheduling and access to care, whistleblower retaliation, and related matters that impact public trust in the VA.

As we move forward, we will continue to work with the Office of the Inspector General and other stakeholders to ensure accountability. But accountability is more than just personnel actions. We must focus on sustainable accountability.

I sent a note to all employees and I've said this in all of my town halls: sustainable accountability means ensuring all employees understand how their daily work every single day supports our mission of caring for veterans. They have to know how their daily work ties back to our values, these ICARE values, and this mission of caring for veterans. And it requires that their supervisor provides them daily feedback and that together they discuss how they can improve our work processes going forward. In that same spirit, employees fulfill their responsibility to veterans and to the Department by providing this feedback and helping to improve our current operations so we do a better job caring for veterans.

Sustainable accountability requires we do a better job of training our leaders, flattening our hierarchical culture, and encouraging innovation and collaboration from the bottom. And we must realistically rate the performance of employees. Everybody can't possibly be rated the best.

One key provision in the new law, the Veterans Access, Choice, and Accountability Act of 2014 seems widely misunderstood or misinterpreted. It doesn't allow VA to fire senior leaders without evidence or cause, nor does it guarantee that VA senior executives will be fired even if VA is seeking to remove them. What the new law does do is it does shorten the time a senior executive proposed for removal by VA has to appeal VA's decision. It doesn't do away with the appeal process or guarantee VA's decisions will be upheld on appeal. But I want to make clear, when evidence of wrongdoing is discovered, we will hold employees accountable. And we will take the action as quickly as law and due process allows us to take.

There are over 100 on-going investigations of VA facilities right now by the VA Office of the Inspector General, by the FBI, by the Department of Justice, by the Office of Special Counsel, and others. In each case, we'll await the results and we will take the appropriate disciplinary action when all the facts and evidence are known.

Now we've made significant progress in recent months, but there's a lot more work to do. Our focus now is turning to what we intend to accomplish over the next 60 days. We call it The Road to Veterans Day. This is in many ways our first 90-day plan, although the time between my confirmation and Veterans Day is slightly more than 90 days. But our purpose is to put together a plan of some quick action steps we're going to take to better serve and care for those who have borne the battle, their families, and survivors. So we're calling it The Road to Veterans Day.

Our mission is the mission that the veterans organization has had. It comes from President Lincoln's Second Inaugural Address when he said that "we have to care for those who have borne the battle, their families, and their survivors."

We have three strategies that we will be following. The first is to rebuild trust with veterans and other stakeholders. The second is to improve service delivery focusing on veteran outcomes, access, and care. The third is to set a course for long-term excellence, looking at the Department from the lens of the veteran and deciding what we need to do to reorganize to deliver better access, better care for the long term.

The first strategy is to rebuild trust with veterans and other stakeholders. Under this strategy, we have a number of tactics. First is to reinforce Veterans Affairs' core values and mission and reset VA's culture to be consistent with them. We have throughout the Department done a leadership exercise with all employees where we talked about VA's mission and core values. And we've asked all employees to recommit themselves, reconfirm their commitment to those values. That has been done and we will do this every year to make sure that we don't lose sight of our mission and core values.

We need to build relationships and strong lines of communication with stakeholders. I talked about the four VSO, veteran service organization, conventions that I've spoken to. We've got later this week a breakfast that includes veteran stakeholders, veteran service organizations, as well as military service organizations. We've been reaching out to members of Congress. Before my confirmation, I met with 67 different senators, with members of the House Veterans Affairs Committee. So we're trying to reach out, establish relationships, learn about what's going wrong and figuring out what we can do to improve.

At the same time, we want to simplify communications and in doing that, we want to increase transparency and we want to hold people accountable when things go wrong. So we're busy working on our strategic communication plan. This media event that we're having is going to be one of many in the future.

Strategy two is to improve our service delivery. This is the crux of everything we do. This is how we care for veterans. It's about improving effectiveness and efficiency and focusing on veteran outcomes. We want to reset and redeploy the Veterans Affairs Department's strategic plan. It's a pretty good strategic plan, but the problem is it's not been deployed entirely. We would like every employee in the Veterans Affairs Department to be able to know what they do every single day and how it ties back to our mission and how it's consistent with our values. So we're going to go through the process of that. We're also going to look at each one of the strategies, make sure they're robust, make sure we have the right tactics, the right action plans.

Importantly, as we go through this, one of the things we'll be looking for is work that doesn't add value to the veteran. And if we have work that doesn't add value to the veteran, we'll simply stop doing it so we can redeploy resources more toward the veteran. As we do that, we're also going to be using digital technology to improve our systems and as we're able to free up people through improved digital technology, we're going to take those people and redeploy them again against the veteran.

We want to reorganize to better align and simplify service to veterans. Right now, if you go to any Veterans Affairs website, you'll find that there are 14 different websites that require a different user name and a different password for veterans to access the VA. That's just flat wrong. We've got to make it easier for the veteran to access the VA through one website, one user name, one password.

Similarly, if you looked at the structure of VA, you would find that we have nine different geographic maps for how we're organized geographically. Every part of the VA has a different geographic map, a different hierarchical structure. We're going to be looking at how do we reorganize the VA so that when the veteran looks at the VA, the veteran knows how to connect and how to get things done. We are too complicated from the veteran's standpoint.

Third, we want to engage federal, state, and private sectors to partner and capture best practices. We know we can't do this job alone. We know we have to partner with members of Congress. We want to partner with the veteran service organizations and military service organizations, with state governments, private sectors. On many of my trips, I've met with state governors and next week I'll be going to a convention of state representatives working on veterans' affairs. We want to do what we can to partner with these organizations and also to learn best practices and pass along those best practices.

Strategy three is to set the course for the long term for excellence and reform. We want to accelerate access to care while implementing the Veterans Access, Choice, and Accountability Act of 2014, the act that was just passed. We have a stand-up team that we've already brought up that will be meeting every other week to make sure we execute this act with excellence.

We also want to assess key programs and either affirm that they're appropriate, adjust them, or eliminate them entirely in order to move resources to a different activity that we're more confident will affect veterans.

So here again is a summary of the three strategies and the mission of the Veterans Affairs Department.

Now we'll judge the success of all of these efforts against one single unified metric and that metric is obviously the satisfaction of the veterans that we're trying to serve. We shouldn't punish veterans for having nine different geographic maps for the Veterans Affairs Department. We shouldn't punish veterans for having 14 different websites with user names and passwords required. In other words, we want to look at everything we do through the lens of the veteran.

In the end, the VA exists to serve them, to serve veterans, whether it's those veterans I had breakfast with at the Blinded Veterans of America Convention who told me that the VA care and treatment has given them the ability to climb mountains, ride horses, and accomplished things they never expected when they were first injured; or those veterans I met when I was in Phoenix, who were being scheduled for their next appointment. I'm convinced that we are going to be able to come out of this process better able to meet the needs of our veterans because we will be looking at everything we do, every service we provide, every customer interaction we have through the eyes of the veteran.

Thank you very much for your attention. And I would be happy to take any questions that you have.

Yes, please.

- your first name. I'm Bob.

MR. SHANE: Absolutely. Leo Shane. Military Times.

SECRETARY McDONALD: Leo, pleasure to see you again.

MR. SHANE: Good to see you. I had a question. You talked about sustainable accountability, and obviously there's more to the accountability than just the personnel actions, but when are we going to see personnel actions? We do have the Phoenix report. We have seen some other information. There was another report last week of problems in the Minneapolis VA with covering up data manipulation. So when should we expect to see some firing, some personnel action, some accountability on that side?

SECRETARY McDONALD: Well, you've already seen it. In fact, we've publicly announced some and we report to Congress about those that we've taken. For example, I've got a Senate Veterans Affairs Committee meeting tomorrow on the Phoenix IG report. One of the things we will talk there is that we've proposed disciplinary action against three Senior Executive Service employees in Phoenix. As I mentioned at the American Legion Convention, we've had 30-plus actions already. We've had two SES employees retire or resign. We've had three SES employees on administrative leave awaiting outcomes of those actions that we've proposed. And we've had over two dozen medical professionals who are no longer working for the VA.

MR. KESLING: Hi, Ben Kesling from the Wall Street Journal.

SECRETARY McDONALD: Hi, Ben.

MR. KESLING: Having a resignation or someone leaving the job is not the same as them being fired and proposed discipline is not the same as actually having discipline in place, so I'd just like to follow on to Leo's question.

SECRETARY McDONALD: Yes, Ben, having run a major corporation before coming to the VA, the Procter & Gamble Company, arguably one of the most admired companies in the world, personnel actions require a value of respect for the individual and there's a process that needs to be followed. And whether it's in private industry or whether it's in the public government sector, there's a process, a due process that needs to be followed. Attorneys are involved. In the case of union members, union leadership is involved. And so when I say that we've proposed three actions in Phoenix, that's what's happened and the process is going, and the process has started.

Now, having said that about Phoenix, right now in Phoenix we have an acting director, Glenn Costie, who comes from Ohio. He's off to a great start there. He's doing a great job. And we have an acting regional director in Lisa Friedman, who comes from our Palo Alto facility, which is one of the best facilities we have. So she's busy there also improving.

So while we have to wait for these actions to take their due process, we are as impatient as you are. And we have 100 investigations ongoing and as those investigations are going on, we are not allowed to take definitive action, but we're doing all we can.

MR. DALY: Hi, Secretary. This is Matthew Daly with the Associated Press.

SECRETARY McDONALD: I'm Bob. Matthew.

MR. DALY: I wanted to ask you about the Phoenix IG report, and some people are trying to say because the way the sentence was worded that they could not conclusively assert that those 40 veterans died because of the delays in the care, that that sort of absolves VA of problems. I wanted to know if you think that that's too high of a standard for them? And that gets at sort of wrongful death issues and leader liability. Would it be more accurate to say that there were people that died while waiting for care and these were people that should have been taken care of?

SECRETARY McDONALD: Okay. We are deeply sorry for the problems with access to care and with the timeliness of care and with the quality of care that occurred in Phoenix. I don't think that any investigation could make us feel any better about that. We feel terrible about that.

We have embraced the IG's report. We cherish the feedback that we've been given. We have worked on remedies for everything that the IG has pointed out. We've concurred with the report. And already 3 of the 25 remedies that we've taken have already been actuated, executed actually in Phoenix.

So we are very sorry for what happened at Phoenix and we're working very hard to learn from it and pass those learnings around the entire system so that this doesn't happen again.

Yes, sir? I'm sorry. I pointed - we're trying to pass microphones around. I'm sorry, Josh.

MR. DAVIDSON: Joe Davidson with the Washington Post.

SECRETARY McDONALD: Hi, Joe.

MR. DAVIDSON: During your travels you talked with employees of the VA. Was there any one issue or any one complaint that stood out from those conversations?

SECRETARY McDONALD: That's a good question, Joe. I think the biggest take-away for me from talking to employees was that we need to open up the culture. When I was going around, it seemed to me that employees thought of the hierarchy of VA as a pyramid. And being the Secretary, everybody would rise when I entered the room, everybody would call me sir, and it was very formal. And as a result, I got the impression that employees thought that the Secretary, like the CEO of a company, was on the apex of the pyramid and that the veterans were on the bottom of the pyramid. And I don't like that idea.

So one of the things I'm trying to do is create a non-hierarchal organization, one, where the veteran is on top. So the organization we're trying to create looks like this. (Drawing) The veterans on top. And all of those people who work against the veteran and work with the veteran every single day are really the ones that need supported in the organization. And I, the Secretary, am on the bottom trying to help those people in the organization.

So while I'm asking you to call me by my first name, I'm asking everybody in VA to do that. I need to create a much more open culture here where every employees feels comfortable telling the Secretary what's wrong in the organization and how we can improve.

So I've sat down with the union leadership throughout the organization. I've demanded that the union leadership be in all of my town hall meetings. I have also had in my town hall meetings veteran service organizations, military service organizations, members of Congress, staffs of members of Congress. Anybody who wants to come, I want to hear from.

I also do my own email. I don't ask someone else to do my own email. So people know how to contact me. I've given out my cell phone number. If you saw my confirmation hearing, you would see I gave my cell phone number to members of Congress. I've asked for theirs in return. We need to open up the lines of communication in this organization and get rid of some of the hierarchy and bureaucracy, flatten the organization and all focus against that veteran.

And so we're in the process of doing that. We stopped a number of things that had been done in the past in order to free up time and resources to focus on that veteran. It's all about customer service, and any customer service organization in the world does these sorts of things. We've got to do it here.

Yes, sir?

MR. DRUZIN: Heath Druzin with Stars and Stripes.

SECRETARY McDONALD: Heath?

MR. DRUZIN: Heath, yes.

SECRETARY McDONALD: Heath, I'm Bob.

MR. DRUZIN: So what does that actually look like on the ground, though? I mean, you're talking about changing the hierarchy, getting rid of the hierarchical system, but what does that look like actually at a VA facility? How are you actually going to change that on the ground and do it quickly?

SECRETARY McDONALD: Well, one of the things we've got to do is we've got to get more people, Heath, against the veteran. I was in one facility. I think it was in - I may mistake if I choose a location, but I think it was Nashville where we had 12 customer service representatives that wore red coats so when a veteran walked in the door they could immediately identify who was there to help them and that person could navigate them through our system. Those people had iPads so they could contact the doctors, nurses, whoever they needed immediately. And I learned that we've gone from 12 of those people to 2. So we've got to get people back against the veteran. That's one example.

Another example is we have kiosks in the waiting room so when a veteran comes in, they can tell us what they need. That's another example.

Another great example is we're piloting a program right now where VHA and VBA, the health arm and the benefits arm, will get together and go out to Little Rock, Arkansas together and have veterans come through to get one-stop-kind of shopping so they can get their health check and their benefits lined up all at one stop.

Those are the kinds of things we need to do. Again, it's very simple, Heath. You look at it from the standpoint of the veteran. What does the veteran want? Does the veteran want to have to go through bureaucracy? Do they want to have to have 14 different user names and passwords? Do they want to worry about nine different geographic maps? Do they want to worry about a hierarchy? No, they want service, and that's what we want to provide. It's going to take time, but we're going to do it.

It sounds simple, but step one is having every member of the organization commit themselves to the mission and the values of the organization. And where we have members of the organization who haven't committed themselves to that, then you have to question are they really going to be able to get this done?

MS. DILLON: We have a question over here.

SECRETARY McDONALD: Yes?

MS. LUNNEY: Hi, Kellie Lunney from Government Executive.

SECRETARY McDONALD: Hi, Kellie.

MR. KESLING: How are you? Are you worried about your ability to recruit and retain talented senior executives given the new provisions in the law regarding firing and the temporary ban on bonuses?

SECRETARY McDONALD: Actually, Kellie, I am worried about our ability to recruit and retain talented people. We need tens of thousands of new doctors, new nurses, new clinicians. And because of the importance of that, last week I started a recruiting campaign. So my third week, my second week I called the Chancellor Emeritus of Duke University Medical System, who I knew, and I said could you please set up time for me to talk to the students at Duke University Medical School?

So I went to Duke in Durham a week or so ago. I sat down. I did what's called grand rounds. I had all the doctors and nurses there and I spoke to them about what a great place the VA is to work.

How many of you knew that the VA had three Nobel prize winning scientists or doctors? How many of you knew that the VA had seven Lasker Awards? How many of you knew that the VA invented cutting-edge technology? For example, it was a nurse at the VA that came up with the idea of using the bar code that's common on Procter & Gamble products and other products to help patients get the right medicine and the right care in a hospital? How many of you knew that? How many of you knew that the VA, the Government will repay student loans or will help you get loans, help you get into medical school, nursing school? How many of you knew we had a program for nursing?

So we've got to do a lot of recruiting.

When I was in Philadelphia last week, last Friday, I met with the University of Pennsylvania. We have a great partnership with the medical school there. And again, we were asking for those doctors, those nurses to come join us.

I think we have an inspiring story. What I've heard from our doctors and nurses is there's no better patient than the veteran. And so, we've got to get that inspiring story out.

I've asked members of Congress, I've asked Chairman Miller of the House Veterans Affairs Committee, Chairman Sanders of the Senate Veterans Affairs Committee, to come recruiting with me, because I think we need to get the story out. And they've agreed. We're going to do this recruiting together because there's no way we can hire that many doctors, nurses, clinicians without everybody's help.

Yes, sir?

MR. OPPEL: Mr. Secretary, Rich Oppel with the New York Times.

SECRETARY McDONALD: Rich, thank you coming.

MR. OPPEL: Thank you, sir. You just said that you need tens of thousands of new doctors and nurses and clinicians. How far did the legislative package that came out in August get you along the way towards that? I mean, does this mean you're going to have to go back to Congress and ask for a lot more to get you where you need to be on that?

SECRETARY McDONALD: No, Rich, the legislative package was sufficient. Sloan and the team did some outstanding work putting that package together. We have the authorization for the positions. The issue now we have to find the people.

Let me tell you a story: So I was on a plane flying into Phoenix and I was talking about the VA. So the individual behind me asked if I worked for the VA, and I said I did, proudly. I was wearing my ICARE button. And he had retired from the Air Force. He was an employee of the Lockheed Martin Company.

And he said you have a challenge, Bob. And I said what's that? He said, well, I'm retired from the Air Force. My daughter is a lieutenant in the Air Force. She goes to the medical school, the Government medical school, U.S. Institute for Medicine here in Washington, D.C. And he asked her about working for the VA, and she said, dad, haven't you been seeing what's going on in the media? Have you been reading the newspaper? Haven't you been watching it on TV? Why would I want to join the VA?

So I said give me her phone number. Her name is Alexandra. I've called her three times. She's set up for me to go recruiting at her medical school. And I think we're pretty close to convincing her that the VA is a great place to work.

When I was in Charlotte, I talked to two individuals, one from the Navy, one from the Army, both leaving the Service, both physician's assistants, and talked to them about coming to work for the VA. The VA is a great place to work. And all of you need to help me get the message out that this is a great place to work. We have the best patients in the world and we've got great resourcing, which allows us to do the kind of research we need to do, the innovation we need to do and be on the cutting edge of medicine for our country.

Yes, sir? Joe? I'm sorry. Joe, did somebody else have a question who hadn't asked one yet?

PARTICIPANT: Yes, sir.

SECRETARY McDONALD: If you don't mind, Joe, let me go ahead.

MR. CALLAGHAN: Mr. Secretary -

SECRETARY McDONALD: I'm Bob. Really.

MR. CALLAGHAN: Bob, Marty Callaghan with the American Legion Magazine.

SECRETARY McDONALD: Hi, Marty.

MR. CALLAGHAN: When we were down in Augusta, we talked to a hospital director down there who complained about some kind of a wage freeze that OPM had put on medical staff and indicating that now the medical wages in the private sector are effectively about 20 percent higher than those in VA. And he talked about nurses who would be at VA for a year, then cross the street and go to work at the teaching hospital for thousands of dollars more.

Is that freeze in effect and is that a problem that needs to be addressed?

SECRETARY McDONALD: Yes, Marty, there are two issues that you described. The first is OPM has evaluated some our positions and downgraded them, and they tend to be positions which are the staff positions which are closest to the veteran. So I've told all of our operations that we need to take a look at those, and if those people really are our front line working with our veterans every single day, we need to seek exceptions to that evaluation.

I think we might not have done a great job of presenting the importance of those people. I mean, in any corporation, particularly one that's service-oriented, the people on the front lines serving the customer are highly, highly, highly valued. So we're going back now and we're looking at that and we're going to be looking to seek exceptions where we need them.

The second point you raised is the compensation of medical personnel. I've heard this in every site I've been at. We've had a freeze for over three years now. I've gone back, and with the help of Dr. Carolyn Clancy who leads the VHA, we've identified all our different positions and we've benchmarked them with private industry.

I talked to the President when we went together to the American Legion Convention in Charlotte, and we're in the process of evaluating potentially raising those salaries to a level where we can be competitive with the outside. It does us no good to recruit people if we can't retain them, and certainly compensation is a part of that.

Although I have to tell you, too, most of our employees say they don't do this for the compensation. They do this for the calling of serving veterans. But we got to get the compensation competitive.

Yes, ma'am? I think I can do one more. There's one over here, too.

Yes, ma'am?

MS. OWENS: Hi, I'm Donna Owens.

SECRETARY McDONALD: Hi Donna.

MS. OWENS: I'm writing for Ebony magazine. Thank you. Hi.

I wanted to ask you, Secretary, how many vets currently work for the VA? And then, two, does there currently exist or will there be a thrust to hire veterans as a part of your desire to bring on more medical and clinicians, particularly those from Iraq and Afghanistan?

SECRETARY McDONALD: Yes, thank you, Donna. Currently in the VA we have about 340,000 people, and of that 340,000 about 35 percent or so are veterans. We have a hiring preference for veterans. So, yes, we want to hire veterans.

At Palo Alto I met a young lady who's one of the top orthopedic surgeons in the country. She went to Stanford Medical School. Her undergraduate alma mater is mine, West Point. Of course, she was a few years after Sloan and me. But an outstanding orthopedic surgeon.

So we're looking for everybody with talent.

There was a question over here. Yes, sir?

MR. VERTON: Dan Verton with FedScoop.

SECRETARY McDONALD: Yes, Dan?

MR. VERTON: Later this year you'll be awarding the contract for your replacement scheduling system. Do you suspect that you might have to go back to Congress for additional funding to ensure the entire roll-out of that system?

And secondly, will you insist on greater controls to ensure that you know who is doing what on that scheduling system?

SECRETARY McDONALD: We tried to put the money we needed in the act that was recently passed. I can't predict the future, but I think we've done a good job of that.

As we work through this scheduling system, we're going to be very eager to find an off-the-shelf product that's proven effective, that we won't run into executional difficulties as we move forward.

We're making a number of fixes with the current system, so we're not waiting for that. And we're going to get that right and we're going to do that as quickly as possible, but that off-the-shelf product will become very, very important as we move forward. And I thought it was a brilliant piece of work by Sloan and the team to come forward and say we are going to take an off-the-shelf product.

Again, look at every decision through the lens of the veteran. We don't get rewarded for making a scheduling system. We get rewarded for having an effective scheduling system that gets veterans into care.

MS. DILLON: Maybe one more question.

SECRETARY McDONALD: Okay.

MS. WAX: Hi, Bob. I'm Emily Wax from the Washington Post.

SECRETARY McDONALD: Hi, Emily.

MS. WAX: How are you? First of all, can we have your cell phone number?

SECRETARY McDONALD: Sure. (513) 509-8454.

MS. WAX: That's wonderful. Do you have a specific budget -

SECRETARY McDONALD: Can I have yours?

MS. WAX: Oh, sure.

SECRETARY McDONALD: Give it to Vicki, please.

MS. WAX: Definitely. Do you have a specific budget number for the tens of thousands that you want to hire?

SECRETARY McDONALD: Well, we've already got the money for them.

MS. WAX: Is there a breakdown of that total?

SECRETARY McDONALD: We've got the breakdown in terms of classification of the people we want and how much money goes to each one. We can give that to you later.

MS. WAX: Okay.

SECRETARY McDONALD: You should know, when I came in I had heard an accusation that we had doubled the size of the headquarters staff in VA over the past few years. So every accusation I hear, everything I read, I try to understand this.

So we did an analysis and come to find out the size of the headquarters staff in the VA is actually lower as a percent of total than it was eight years ago and that the number one classification of people we've hired over the last years has been nurses. And that's obviously up significantly as we've increased the footprint of who we care for around the country. So we look at this very, very carefully and through a really microscopic lens to make sure we're hiring the right people and putting them in the right places.

Now, the fact that the size of the headquarters is actually lower as a percent of total than it was before also includes the fact that we've centralized some functions here in headquarters like IT, which I think we all agree it's better to have one IT system across the department than to have Balkanized IT systems.

PARTICIPANT: Can you make that data publicly available, that study that you're talking about so that we can compare it ourselves to see what the numbers were X number of years ago and what they are today?

SECRETARY McDONALD: We can share that.

PARTICIPANT: That would be great.

SECRETARY McDONALD: We'll get you that data.

Yes, sir?

MR. ZOROYA: Gregg Zoroya, USA Today. You speak of the headquarters staff. When you came on board in late July it had already been affirmed by both the VA and the IG that this was a system-wide scandal, system-wide problem. And I was curious. When you came in, were you curious at all about whether those in the Central Office, the top of the VHA had any idea of these delays and of these manipulations? I mean, the fact that you could have - and you already indicated 100 places or more now are under investigation - that this could go on without anybody in the Central Office having any idea? Did that spark your curiosity? Does that concern you? Or is that something you just want to put behind and move on?

SECRETARY McDONALD: It was Gregg, correct?

MR. ZOROYA: Yes.

SECRETARY McDONALD: I think I addressed that, didn't I, when I talked about the need for a more open culture and I showed you the pyramid that's typically like this that people think of an organization. I turned it on its apex. As I analyzed the organization, my sense was the culture was too closed, that there was too much hierarchy, that -

MR. ZOROYA: But I'm talking about people who were aware of the -

SECRETARY McDONALD: Well, that's what I'm telling you. That's why I'm telling you why they may not have been aware. I mean, I haven't sat down and asked every single individual, but I have a very simple axiom. I've been doing this now for - well, Sloan and I have been doing this in private enterprise for 40 years. Organizations are perfectly designed to get the results they get. So don't spend a lot of time trying to figure out the result. You know what the result is. Figure out why the organization was designed to get that result.

So what I tried to do in my description of a very closed culture; which Robert Nabors in his report called a toxic culture - I tried to explain why information wasn't getting from the bottom to the top, what may have been the reason why. That's why I've mandated town hall meetings It's why when I go out I meet with stakeholders. It's buried - it's not buried - it's in these strategies that I've talked about that we're going to follow in the future.

We're going to be transparent, we're going to be accountable and we're going to get every employee involved to get - every employee who commits themselves to our mission and values, but every employee involved in improving care for our veterans. There's no other way to do it. And the fact that that wasn't happening suggests we have work to do. But we've started it.

MS. DILLON: Thanks very much, everyone.

SECRETARY McDONALD: Thank you.