Dennis Wagner

USA TODAY

PHOENIX — The Department of Veterans Affairs has come to terms with three Phoenix whistle-blowers who filed retaliation complaints after helping expose mismanagement and health-care breakdowns in the Phoenix VA medical center.

The trio — Dr. Katherine Mitchell, Paula Pedene and Damian Reese — accepted mostly confidential settlements for demotions and harassment they suffered at the hands of VA administrators after exposing delays in patient care, fraudulent wait-time data, bullying and other misconduct.

In a news release, VA Special Counsel Carolyn Lerner praised all three whistle-blowers, saying they "followed their consciences and reported wrongdoing, and their efforts have improved care and accountability. ... I applaud the VA's leadership for taking actions quickly to reverse these (retaliation) cases and concrete steps to change the VA's culture," she added. "The settlements allow these courageous employees to return to successful careers."

Pedene, a Phoenix VA spokeswoman who was banished to a basement library 22 months ago after disclosing misconduct, cried Monday morning as she discussed her experience and its resolution.

"I feel vindicated and happy and sad. There are so many mixed emotions," she said. "I'm moving forward, and looking forward."

Besides the three Phoenix cases, the Office of Special Counsel is investigating 125 other complaints of retaliation against VA whistle-blowers, and is reviewing 89 disclosures from employees who allege threats to patient health or safety. Fifty-one of those have been referred to the Office of Inspector General.

Pedene served as the Phoenix VA Health Care System public affairs officer for two decades and was a long-time director of the Phoenix Veterans Day Parade until she blew the whistle on a hostile work environment and financial mismanagement. She also worked behind the scenes with Dr. Sam Foote, the Phoenix VA whistle-blower whose allegations of delayed care ultimately prompted a national scandal.

Under terms of the settlement, Pedene, who was subjected to criminal and administrative investigation, will become a national program specialist for the communications office of Veterans Health Administration.

"My hope is that settlements like these will help change the VA culture," Pedene said. "What remains to be seen is how far it will go. I think the way to answer that is to have accountability and disciplinary action against those who reprised against me."

Mitchell, a 16-year employee at the VA, was transferred to a program for Iraq and Afghanistan veterans after she filed complaints with hospital administrators four years ago about patient-threatening problems in the Emergency Department. She later was subjected to an investigation and reprimand after raising concerns about veteran suicides. Along with Foote and Pedene, Mitchell provided detailed information to Congress, the VA inspector general and The Arizona Republic about delayed care, falsified appointment data, mismanagement and other issues.

Mitchell, who will now work at the VA's Southwest regional office overseeing the quality of patient care, said she relied on friends and ice cream cones to get her through a four-year ordeal.

"I'm encouraged that the national VA is willing to take a step forward and start to heal from within," she said. "It's a question now whether this is a one-dip-cone or a two-dip-cone day."

Mitchell, who recently testified before the House Committee on Veterans' Affairs, said the Office of Special Counsel assured her that, while the retaliation complaint has been settled, VA will investigate those responsible and take appropriate disciplinary action.

"That's incredibly important," Mitchell said, adding that VA's systemic problem with bullying will remain unchanged unless administrators are held accountable.

Reese, a Phoenix VA program analyst, raised internal complaints last year about falsified data on patient wait-times for doctor appointments. He asserted in a memo that the fraudulent practice was "unethical and a disservice to our veterans." It is unclear what retaliation he suffered. The Office of Special Counsel news release does not spell out any terms of Reese's settlement, and he could not be reached for comment.

The Phoenix VA whistle-blowers sparked a nationwide furor over patient care in the dysfunctional federal agency. Investigators concluded that VA administrators knowingly falsified patient access data, in part to earn bonus pay, and that veterans suffered as a result of protracted delays in care. While inspectors could not conclusively assert that Phoenix patients died because of untimely treatment, the Office of Inspector General acknowledged that delays contributed to fatalities.

The controversy led to the ouster of Secretary Eric Shinseki, passage of a $16 billion VA reform bill, inspector general probes at more than 80 VA medical centers and the suspension of top administrators, including three in Phoenix.