Independent Audit Report on Invoices Submitted by a Graduate Medical Education Affiliate to the VA Nebraska–Western Iowa Health Care System

The VA Nebraska–Western Iowa Health Care System has a graduate medical education affiliation agreement with a local university. Under the agreement, the university provides the services of health professions trainees (residents) to the Omaha VA Medical Center, and VA reimburses the university for the residents’ services. Reimbursement is based on daily rates and fringe benefits provided by the medical center, which must document and certify VA-approved educational activities in educational activity records.

The medical center received a complaint alleging that a university official falsified records to inflate the time worked and signed the records as the VA site director, an act that would constitute a conflict of interest. The VA Office of Academic Affiliations asked the OIG to review six years of potential overbillings of residents’ time totaling about $1.9 million and examine the potential conflict of interest.

The OIG found the medical center did not have educational activity records for July 1, 2016, through June 30, 2020, as required. The OIG attempted to verify the progress notes the medical center used in the place of educational activity records but found them unreliable. Without reliable records, the audit team could not verify the attendance of the residents and could not determine whether the invoices were supported as required. Therefore, VA has no assurance that the residents participated in clinical and educational activities from July 1, 2016, through June 30, 2020, and may have overpaid for resident services.

For the period when the medical center did keep educational activity records, beginning July 1, 2020, the OIG was able to verify residents’ attendance and found no overbillings. Further, the OIG team did not find any conflicts of interest. Because educational activity records were implemented in July 2020, the OIG did not have any recommendations for the medical center.