Dennis Wagner

USATODAY

PHOENIX -- Department of Veterans Affairs administrators knew two years ago that employees throughout the Southwest were manipulating data on doctor appointments and failed to stop the practice despite a national directive, according to records obtained by The Arizona Republic through a Freedom of Information Act request.

A 2012 audit by the VA's Southwest Health Care Network found that facilities in Arizona, New Mexico and western Texas chronically violated department policy and created inaccurate data on patient wait times via a host of tactics.

The practice allowed VA employees to reap bonus pay that was based in part on inaccurate data showing goals had been met to reduce delays in patient care, according to the VA Office of Inspector General. At the Phoenix medical center alone, reward checks totaled $10 million over the past three years.

Top officials at the Phoenix VA Health Care System, including Sharon Helman, who was suspended as director last month, have repeatedly claimed they were not aware of scheduling misconduct until complaints by whistle-blower physician Sam Foote were made public in April.

But audit findings, based on a review of data from the second quarter of fiscal 2011, show the violations proliferated throughout the Southwest and were common nationwide.

The report notes that former VA Undersecretary Robert Petzel, who resigned under fire in May, convened a conference call with Health Administration Services leaders nationwide in September 2011 to confront the problem. According to the audit, Petzel pressed department executives "not to 'game' the system."

A year earlier, William Schoenhard, then a VA deputy undersecretary, described and prohibited various "gaming strategies" used nationwide to falsify wait-time data. His directive made top regional administrators responsible for ensuring the integrity of medical appointment systems, and required annual reviews.

Acting VA Secretary Sloan Gibson last week directed all VA medical center and health care system directors to do monthly in-person site inspections and reviews of scheduling practices in every clinic within their jurisdiction to ensure adherence to policies.

That sort of scrutiny was supposed to have occurred after the 2012 audit.Helman became director of the Phoenix VA Health Care System in February 2012, a month after the Southwest audit was issued. She made timely medical appointments her system's No. 1 priority and implemented a "wildly important goal" program.

E-mails between Helman, Bowers and others — obtained via a public records request — verify that VA leaders in Arizona were intensely aware of scheduling compliance problems during 2013.

Yet, as late as last December, Helman continued to paint a rosy picture for outsiders. In a letter to Sen. John McCain, R-Ariz., Helman discounted allegations of a Phoenix whistle-blower who reported fraudulent record-keeping. By that time, investigators from the Office of Inspector General were in Phoenix, verifying that appointment data had been manipulated.

In her letter to McCain, Helman noted that she and VA staffers had met with Tom McCanna, the senator's liaison for veterans, months earlier "to discuss wait-time issues and scheduling concerns." Helman told McCain her compliance office had performed an audit in July 2013, and "the results validated local data collection efforts regarding EWL (electronic wait list) and access were correct."

Rep. Jeff Miller, R-Fla., who has spearheaded congressional investigations as chairman of the House Committee on Veterans' Affairs, said the new revelations in Arizona offer "continued proof of how VA leaders looked the other way while bureaucrats lied, cheated and put the health of veterans they were supposed to be serving at risk.

"Most disturbingly," Miller told The Republic, "those charged with enforcing VA policies and holding employees accountable for gaming the system never even lifted a finger to do so. The only way for Acting VA Secretary Sloan Gibson to rid the department of this widespread corruption is to pull it out by the roots, and he needs to begin that process right now."

Helman could not be reached for comment on the audit or e-mails. But Susan Bowers, who was forced to retire last month as director of the VA's Southwest regional health care office, said she ordered the compliance review in 2011 based on suspicions of false data on appointments.

"We knew scheduling was a high-risk area" for violations," Bowers said. "The compliance review was done and, as a result, we had a number of goals developed to address those issues.

"That was the thing to fix when (Helman) got to Phoenix. My first instruction to her was, 'We've got to deal with the wait-time issue.'"

Bowers and regional VA spokeswoman Jean Schaefer said action plans were developed based on the audit. They also said the findings were briefed during a network leadership meeting just days after Helman took command of the Phoenix VA medical center.

Bowers acknowledged her scheduling goals focused on reducing delays in care, rather than stopping the falsification of data. She also agreed that using untrustworthy statistics made it impossible to determine whether goals were met, and thus whether bonus pay was justified.

Bowers said she did not issue a regional directive specifically ordering compliance with VA scheduling rules, or warn employees they would be fired for violations, because such memos are not part of the agency culture.

"In retrospect, I wish I would have done that," she added. "But there were constant messages from my office that basically said, 'We don't game the system. We need to know how bad it is.'"

Hundreds of thousands of ex-military personnel nationwide have been affected by the massaging of data and cancellation of appointments at many of the VA's approximately 950 facilities. Appointment manipulations resulted in veterans' delayed care that sometimes resulted in negative medical consequences, according to the VA Office of Inspector General. They also created a false impression of timely patient services, obstructing improvements to the system.

The Southwest regional audit analyzed 573,000 appointments at 3,423 VA clinical offices in the three states. The audit uncovered a spider's web of tactics used to produce inaccurate wait-time data. Among them:

Appointments routinely were canceled in blocks by VA clinics, eliminating backlogs and artificially reducing wait-time statistics.But those same clinics indicated in data reports that the appointments had been canceled by patients. In El Paso, VA health care schedulers canceled one in four appointments during the period examined. Some clinics showed suspected cancellation clusters on more than half of the days during the quarter.

VA employees often recorded walk-in patients as scheduled visits to make it appear veterans were seen without any wait at all when, in fact, they showed up uninvited because they could not schedule appointments. In Phoenix, 77 percent of the walk-in patients were improperly listed as scheduled appointments. At Prescott's VA medical center, 85 percent of the clinics engaged in the deceptive practice, which apparently skewed wait-time data. It also allowed veterans to collect round-trip travel expenses for their clinic visits, rather than one-way benefits authorized for walk-in patients under the VA claims system.

Appointments were entered into computers without listing a desired date, making it possible to insert an untrue date later. That form of manipulation occurred at all seven major medical centers investigated: Phoenix, Prescott and Tucson; Albuquerque; and El Paso, Amarillo and Big Springs, Texas.

When first-time appointments for new patients were not available within 90 days, those veterans' names were not even entered into the electronic wait system. The result? Protracted delays that were not counted in wait-time data.

Some VA facilities misrepresented wait times by incorrectly recording the date patients were seen by physicians as the desired appointment date. At the VA medical center in Prescott, administrators claimed four of five patients were seen on the date they wanted an appointment. Although auditors could not determine the data accuracy without analyzing each appointment, they concluded the numbers were "artificially high" and "could have the appearance of inaccurately capturing the patient's true desired date."

The audit contained a list of recommended changes.

Records show that, for at least four years, data manipulation was not just a Phoenix concern, but a national problem. The VA inspector general is now investigating similar conduct at more than 40 facilities.

Bowers said the dysfunction stems from an outdated, convoluted scheduling program that needs to be replaced with new software, but Department of Veterans Affairs headquarters failed to provide resources. "We need a new system," she said.

The 2012 audit was released to The Republic this week — more than three months after the newspaper filed a March 4 FOIA request for materials concerning wait-time falsifications.

In recent weeks, the VA has been a subject of Senate and House hearings, with scathing attacks by members of Congress and the media for perceived cover-ups and a lack of accountability.

Since the health care scandal was first exposed in April, VA Secretary Eric Shinseki and Petzel have resigned; Bowers was forced to retire early; and Helman was placed on administrative leave along with two other top administrators at the Phoenix VA. Termination proceedings have been initiated against the latter three.

Wagner also reports for The Arizona Republic