Rep. Mike Bost, R-Ill., chairman of the House Committee on Veterans’ Affairs, speaks in January 2023 on Capitol Hill. The committee has scheduled a hearing for Tuesday, June 4, 2024, to examine why Department of Veterans Affairs gave out more than $10 million in bonuses to senior managers that were meant for front-line employees at hospitals, clinics and field offices. (Alex Brandon/AP)
WASHINGTON — Some lawmakers are attacking the Department of Veterans Affairs for giving out more than $10 million in bonuses to senior VA managers that were meant for front-line employees at hospitals, clinics and field offices.
“The incentives were meant for high-demand health care and benefits support staff who are vital to VA’s operations following implementation of the PACT Act,” said Rep. Mike Bost, R-Ill., chairman of the House Committee on Veterans’ Affairs.
The payments were revealed in May in an audit by the VA Office of Inspector General that criticized the VA for improperly awarding bonuses of $39,000 to $100,000 to 182 senior-level executives who were ineligible under a special program Congress created to recruit and retain rank-and-file workers.
The House Committee on Veterans’ Affairs has scheduled a hearing for Tuesday to examine the “VA’s improper decision to award senior executive millions in incentives,” according to the committee calendar.
The bonus program was authorized under the Sergeant First Class Heath Robinson Honoring our Promise to Address Comprehensive Toxics Act of 2022, also known as the PACT Act.
“As an Army veteran and member of the House Veterans’ Affairs Committee, I am appalled to hear of more than $10 million in inappropriate VA bonuses. Instead of prioritizing our veterans, VA bureaucrats were prioritizing their own wallets,” said Rep. Mariannette Miller-Meeks, R-Iowa.
Members of the Senate Committee on Veterans’ Affairs — led by Sen. Jon Tester, D-Mont., the committee chairman — also sent a letter Friday to VA Secretary Denis McDonough demanding answers on how the bonuses for senior-level executives were allowed to advance.
Sen. Jon Tester, D-Mont., chairman of the Senate Committee on Veterans’ Affairs, at a Senate hearing in May 2022. Members of the committee sent a letter Friday, May 31, 2024, to VA Secretary Denis McDonough demanding answers on how the bonuses for senior executives were allowed to advance. (Tom Williams, Pool Photo via AP)
The letter described the bonuses to senior managers at VA headquarters as unethical, a violation of VA policy and in “direct opposition” to the intent by Congress.
“VA’s flagrant misuse of recruitment and retention incentives intended to improve the provision of health care and benefits for veterans by bolstering the front-line workforce is unacceptable and deeply concerning,” the letter reads.
Called the Critical Skills Incentives Program, Congress authorized $119 million in bonuses to reward workers processing a large workload of claims for health care and compensation from veterans suffering medical problems from exposure to toxins during their military service.
The extra pay also was set up as a tool to recruit and retain VA employees in jobs with a high number of vacancies, including for housekeepers, police officers and human resource coordinators, according to lawmakers.
Some of the payments improperly made to department officials exceeded many VA employees’ annual salaries, according to the letter. By contrast, the average bonus payment to front-line workers is $8,000, the VA said.
More than 13,000 employees working in hospitals, clinics and field offices have received bonuses since 2022, the VA said.
In August and September 2023, payments were made to senior managers at the Veterans Health Administration and the Veterans Benefits Administration at VA headquarters, according to an audit by the VA’s inspector general.
Formally known as “senior executive service members,” the individuals serve in senior management roles overseeing VA operations.
Bonuses were paid to 148 senior managers within the Veterans Health Administration, which represented most of the executive leadership, according to the audit. Thirty-four payments were made to senior managers at the Veterans Benefits Administration, the audit said.
The average payment to senior managers at the Veterans Health Administration was $62,000, and the average payment to senior managers at the Veterans Benefits Administration was $50,000, according to the audit.
McDonough ended the bonuses to senior managers in September 2023 after learning about them and directed that the money be returned, according to IG investigators. Some of the recipients involved in the initial planning for the awards also received bonuses, according to the audit.
McDonough is now considering whether to take any personnel action against them, according to the VA.
“VA’s Office of Accountability and Whistleblower Protection is investigating to determine if any recommendations for disciplinary action are appropriate. VA will then review the report and recommendations for possible next steps,” said Terrence Hayes, the VA press secretary.
Department of Veterans Affairs Secretary Denis McDonough pictured on Capitol Hill in 2021. He will testify at a House hearing Tuesday, June 4, 2024, about more than $10 million in bonuses given to senior managers meant for rank-and-file employees at the VA. (Sarah Silbiger, Pool Photo via AP)
The VA issued collection notices in October to senior-level executives who received payments but had not returned the money, according to the audit.
The senior managers were given the option to pay back the money by Dec. 31, 2023, or enter a repayment plan. The collection process is still underway, the VA said.
“VA has recouped more than 92% of the improperly awarded [bonuses] and is in the process of recouping the remaining amounts,” Hayes said Monday.
Outstanding payments are settled for 156 executives, he said. Some payments had not been issued yet when McDonough halted them, Hayes said. Other senior managers entered repayment plans, he said.
The VA will seek full repayment for any delinquent recipients of the improper bonuses, Hayes said.
The audit also found Shereef Elnahal, the VA undersecretary for health, and Joshua Jacobs, the VA undersecretary for benefits, had allowed the plan to reward senior managers to advance, though it went beyond the scope of the bonus program outlined under the PACT Act.
The audit found the Veterans Benefits Administration followed the lead of the Veterans Health Administration to send bonuses to the senior managers, according to the audit.
“When Undersecretary for Benefits Joshua Jacobs learned that VHA was planning to pay [critical skills incentives] to both field and senior executives, he also began discussing with his senior human resources adviser and principal deputy undersecretary for benefits whether VBA should do the same,” the report said.
Michael Frueh, deputy undersecretary for benefits, wrote in an internal communication in April, when the plan was first discussed, that he did not like “the optics of paying execs, because it will add up to a number the public/Congress will question,” according to the audit.
Investigators said they did not see any evidence was ever presented to support bonuses for senior managers. They cited “excessive deference” by human resource managers toward the undersecretaries.
McDonough will testify at the House hearing Tuesday, according to the VA, but neither Elnahal nor Jacobs is on the list of scheduled witnesses.
“Secretary McDonough has made clear from the beginning that he takes responsibility for this issue and has confidence in his leadership team. As soon as VA identified this error, we immediately canceled and began recoupment for all [bonus] payments made to career senior executives at VA headquarters,” Hayes said.
