Audit of VHA Acquisition and Management of Prosthetic Limbs

At the request of the House Veterans' Affairs Committee Chairman, we evaluated the management and acquisition practices VHA used to procure prosthetic limbs. In each of the last 5 years, VHA has served nearly 12,000 amputees. VA procures prosthetic limbs or fabricates them in prosthetic labs. We found overpayments for prosthetic limbs were a systemic issue in VA. Of the 3,900 payments we examined, 915 (23 percent) included overpayments. These overpayments were valued at about $2.2 million for FY 2010. VHA could continue to process improper payments over the next 4 years if it does not strengthen controls over payments. We estimated the value of these potential overpayments at $8.6 million. Finally, VHA management did not know the current capabilities of their labs. Overall, VHA needs to strengthen management and acquisition practices to procure and fabricate prosthetic limbs. The Under Secretary for Health concurred with our findings and recommendations.