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VA criticized several times for faulty contracts

WASHINGTON—The Department of Veterans Affairs has been criticized by its inspector general several times for faulty contracts that don't protect the interests of the taxpayers, or in some cases, veterans themselves.

The agency has generally accepted the inspector general's findings and said it has or will take steps to correct any mistakes.

Among the recent reports:

_In January, the VA was slammed over a $140 million contract to upgrade the agency's system for tracking patient financial information. The inspector general said there were "performance problems from the inception of the contract," that the VA's "interests were not protected" and that there were "no documents" for part of the bidding process. When the VA's in-house lawyer objected to some of those findings, the inspector general said the response "demonstrates their unwillingness to accept responsibility and be held accountable." About $30 million was paid on the contract before it was canceled.

_In February, the agency was criticized for mishandling a contract intended to help the VA analyze data that had been stolen from an employee's laptop. The inspector general said there was "no justification" for awarding the contract on a sole-source basis and that the VA "significantly overpaid for the services." At one point, the winning firm was unable to work with a common computer format. Beyond that, some decisions on the contract were made in the middle of the night, with the bidding process at one point lasting three hours—from 10 p.m. until 1 a.m. A key VA official on the contract refused to talk to the inspector general about the contract; he resigned his job early and erased his computer's hard drive before he left. The VA paid approximately $150,000 on that contract, an official for the inspector general's office said.

_In 2005, the VA was cited for poor oversight of contracts with various medical schools. The inspector general said that some VA physicians were helping to set terms of contracts with the outside organizations, such as the medical schools, where they also worked. Further, some of the contracts seemed to be tailored to meet the needs of the med schools and not the VA. Doctors were allowed to be on-call at both the VA and at the outside organization. The IG found that the VA had been the subject of at least one medical malpractice claim in which the on-call doctor was in surgery at the outside organization when needed at the VA.

_In 2005, the contract for a major tracking study of Vietnam veterans with post-traumatic stress disorder was "not properly planned," "did not protect VA's interests" and did not "demonstrate sound business practices." The contract was terminated early, and some of the money already spent "may have been wasted." At least $4.7 million was spent before the contract was stopped.