VHA's Management Improvement Initiative

Pursuant to a congressional request, GAO examined the Department of Veterans Affairs' (VA) progress in implementing health care system management improvement initiatives. GAO noted that: (1) VA is reducing its centrally funded activities by $170 million, equipment purchases by $26 million, and other headquarters-managed accounts by $89 million; (2) VA has deferred most decisions pertaining to the streamlining and integration of VA facilities; (3) the savings from facility integrations could be less than originally expected due to facilities informally integrating services before they are formally approved and having different missions and geographic locations; (4) VA has delayed action on many of the task force's recommendations and has delegated authority to its field managers to realign facilities and personnel; (5) VA has no formal plan to achieve the specific management improvement savings cited in its fiscal year 1995 and 1996 budget submissions; (6) VA has cut each medical facility's budget across the board to compensate for the difference between its budget proposal and the amount appropriated for veterans health care; (7) this measure will not allow VA to achieve cost efficiencies or ensure that patient care is maintained; and (8) VA needs to improve its budget requests through better tracking of management improvement initiatives and associated savings and use the resource allocation system to distribute VA medical facilities' resources.