Mr. Chairman, are you ready to begin . Please begin your five second countdown. Chair pappas five, four, three, two, one. Good afternoon. I call this hearing to order. Without objection, the chair is authorized to declare a recess at any time. We have a number of members participating remotely today. And before we proceed, i would like to go over some items for our members participating remotely. First, if youre experiencing connectivity issues, please make sure you or your staff contact our Technical Support so those issues can be resolved immediately. Members participating remotely must continue to use the video function for the duration of their participation in the hearing, unless they experience connectivity issues or other technical problems that render the member fully unable to participate on camera. It is committee and subcommittee policy that members participating remotely will remain muted when not recognized, just like turning on your microphone on and off during an inperson hearing. This is out of courtesy to all members on the committee and so that background noise does not interfere with another member who is recognized to speak. When youre recognized, you will need to unmute your microphone and pause for a couple of seconds before speaking so that well be able to hear everything you say. If you wish to be recognized, please raise your hand using the webx raise hand function, unmute your microphone, and ask to recognized. In order to be ensure that everything members say is captured on the livestream of this hearing, members are asked to pause for two to three seconds before beginning to speak. If you wish to have a document inserted into the record, please ask for unanimous consent and have your staff email the document to Veterans Affairs. Hearings mail. House. Gov. It will be uploaded to the Committee Document repository. Please keep in mind that you will need to refresh the repository page, as it does not automatically update. Without objection, members will be recognized in order of committee seniority for questioning witnesses today. This will make it easier for me to ensure that all members participating have an opportunity to be recognized. Does any member have a question about the conduct of this hearing, with members participating remotely . Seeing none, i now recognize myself for an opening statement. Welcome, everyone. Todays oversight in investigation subcommittee hearing will examine the department of Veterans Affairs medical supply chain. One important question is, what lessons have we learned from the pandemic . As the nations largest integrated healthcare system, v. A. Purchases billions of dollars in vital lifesaving medical supplies and equipment each year in order to serve millions of american veterans. Unfortunately, vas purchasing and Inventory Management system has long faced many serious problems. Just last year, the Government Accountability office added v. A. Acquisition to its highrisk list, largely due to medical supply chain challenges. The media has also chronicled many instances of supply problems impacting Veterans Health care, even long before this pandemic. For example, the v. A. Medical center in washington, d. C. Canceled and rescheduled medical procedures between 2015 and 2018 because it did not have the needed supplies onhand. As gao will testify, v. A. Medical centers have experienced back orders for as much as 22 of medical supply items that are generally provided by vas main supply vendors, including needles, alcohol pads, tissues, and even garbage bags, when Medical Centers needed them. The ongoing pandemic dramatically exposed weaknesses of the supply chain. First, v. A. Struggled to get a handle on which hospitals were facing shortages. Because of an antiquated inventory system, v. A. Established a new but still manual system for gathering and reporting daily supply levels to its hospitals. They used common spreadsheets to track supplies with information phoned in by each hospital. As a result, during the early weeks of the pandemic, v. A. Scrambled to contract with inexperienced vendors. And when some were unable to fill orders, supply deliveries were delayed. Its important to point out that v. A. Hospital staff and leadership worked tirelessly to procure the needed supplies as the severity of the pandemic grew. We all should commend their dedication and creativity during an extraordinarily challenging time. We also saw many other examples of dedicated people helping our veterans during the pandemic. I can report with pride that in my home state of New Hampshire, we stepped up. Since the pandemic began, New Hampshire arranged 15 shipments of personal protective equipment sourced from across the globe through Close Partnership with the public and private sectors. 10 of those shipments included ppe specifically for v. A. , including one with 4. 5 million masks, another with 400,000 gowns, and the list goes on. These ppe deliveries reimbursed by the state to private partners with cares act funding made a big difference to many of our veterans and v. A. Employees. It is one of many examples where americans might above and beyond. The Department Needs a modern and effective addition and inventory system. This. A. Is years away from goal and has been grappling for some time. V. A. Launched the medical prime Vendor Program in 2004. It faced many problems and shortfalls. They tried the next Generation Program in 2016. Things did not go as well as hoped. V. A. Is planning the prime vendor 2. 0 program, which will launch in 2021. You heard that correctly. There is more information here. The v. A. Is planning to take steps to replace its medical surgical prime Vendor Program before the program has really started. V. A. Has plans to transition Medical Centers to the dod supply inventory tool. This will take up to seven years. All of the supply chain initiatives create a dizzying array of overlapping efforts and confusion. I hope to hear how the current plans for creating a modern medical supply chain will prove successful. During todays hearing, we will examine steps to address medical supply shortages from the pandemic. V. A. Is establishing Readiness Centers to store stockpiles of masks, gloves, other critical supplies. I applaud this attempt to implement lessons. This seems too far off in the future. I look forward to hearing from our witnesses during proceedings. Veterans and hospital staff should have the confidence the supply chain is modern, effective, and efficient. I would like to recognize Ranking Member bergman for comments. Thank you, mr. Chairman. I want to welcome our witnesses to discuss strengthening the medical supply chain. Know they have been working around the clock for many months to support the pandemic response. Thank you again. I would also like to recognize miss oakley and her team for their great work going back a number of years on improving v. A. Contracting. Lastly, i want to express my appreciation for your support in calling mr. Walton to testify. He is technically a minority witness, but we will all benefit from his expertise. Americans have not given much thought to our supply chain. Overreliance on china was obvious but others were not discussed outside of think tanks. The impact was limited. Today is different. The covid19 pandemic has upended supply chain and impacted all of our lives. Many medical supply industries are experiencing a soaring demand. Supply chains as health care providers, state and government and other federal agent. While ppe output has increased significantly and many new tests have come to market, surplus inventories are still months away. That is why it is so horton that v. A. s supply chain be effective. Be precise. St many aspects have been in shambles for years. Policies and procedures are confusing. The Inventory Software is archaic and the program has been stuck. The commission on care issued its recommendations in 2016. This was the most recent top to bottom look at the medical supply chain by independent experts, and it was largely ignored. The v. A. Has a lot of ardworking people, but unifying supply chain with complete ability from Medical Centers to the Central Office does not exist this was the state of affairs as the pandemic struck. There are Reform Efforts underway. Given the speed of events, i am concerned. The rationale for selecting the whilenagement system there are excellent supplies until v. A. Has a modern system at every Medical Center, no other reform can get me improve or eliminate waste. This is only in the early pilot stage. Even after being accelerated. That thely concerned call was rebuffed. Turning to the regional Readiness Centers, i worry i support the object, but it remains to be seen how this will be wished. Supplies that sit in warehouses and did not, when needed realtime, are no. Hope to learn more about the strategies to increase testing. The early decision to maximize testing was smart. The v. A. Started at the front of the line and secured a large amount of limited supplies. It has limited the ability to purchase greater quantities of rapid test kit. Laboratory tests are more widely available, but processing bottlenecks this is a difficult problem that everyone is competing to resolve. Thank you to our witnesses for joining us this afternoon. I healed back. Yield back. Thank you for your comments. I will recognize our witnesses. The acting assistant secretary for enterprise integration. She is accompanied by deborah kramer, the acting assistant. And mr. Andrew, the director of the office for Veterans Health administration. Your recognized for five minutes. Good afternoon. Thank you for the opportunity to testify today about the resiliency of the department by chain. By deborahanied kramer. As well as mr. Andrew. The department of Veterans Affairs response to covid19 demonstrated the strength and agility of an integrated health care system, operating as a single enterprise. As incidents there made by critical equipment , v. A. Was able to sustain operation and variance due to convince urges. Supply chain challenges are not. Due to the pandemic, we are experiencing the same challenges every Hospital System in the country. With 170tage, one hospitals is our ability to share our supply and resources. , we prepare for all. Ontingent however, the magnitude of this Global Pandemic has provided the opportunity for some improvement. Began transforming our supply chain to increase efficiency, maximize value and deliver realtime analytic to support fast and accurate decisionmaking. Work is than ever, this essential and we are committed addressing this. Allowing v. A. To remain fully committed. , weugh this collaboration will implement a standard support on an enterprisewide basis to replace the legacy system. Some of which were designed and played in the 1920s. It will ensure visibility and decisions were ability to deal with it to deliver the right product to the right places, at the right time. We are aggressively preparing to replace the0 to next generation. It will enable expansion and enhance meant of supply and availability and will incorporate a broader array based on clinical requirements and Health Care Operational need. It will establish readiness forers distributed consortiums. And use jointacts networks for referring patients and conducting telehealth. Transitioning from our current state requires resiliency in our supply chain. , v. A. H the establishment is ensuring that it has enough capacity for critical supplies. The assumption of precovid operations. We are committed to providing high polity health care to all of our veterans, even during unprecedented times. Your continued support is essential for providing care to veterans and their families. My colleagues and i are prepared to answer your question. Thank you very much for your comment. Our next witness is a director of contracting and acquisitions for the Government Accountability office. Welcome. You are recognized for five minutes. Thank you. Thank you for having me here today to discuss the supply chain transformation efforts. As the largest integrated Health System in the country, v. A. s ability to effectively and efficiently manage its supply chain is critical, even absent a pandemic. We have highlighted challenges for many years and our forthcoming report on several supply chain transformation effort point two continuing challenges. As i begin, i want to take a moment take knowledge the hardware hard work on behalf of our nations veterans. It has been an all hands on deck effort. Leveraging its fourth voice step team supplies. Offices that dont typically purchase medical supplies and supplies did so, and in allowed staff to buy larger amounts of my. Despite its own efforts, their needs cannot be met shortages. It merged with fema to obtain ppe, including from the National Strategic stock pile. How v. A. Identified these gaps in supplies has evolved over the past several months. As i testified in june, when the pandemic hit, tracking supply status at 170 centers proved to be a challenge. V. A. s antiquated system forced officials to rely on manual daily inputs of ppe inventory for Medical Center staff. V. A. Has created a tracking tool to enable enterprisewide decisions. Medical center input remains a manual process since inventory systems at Medical Centers do not dictate with tracking tool or each other. V. A. Is well aware of the shortfalls in management. Rollout of the system at initial locations has been delayed by almost one year, and full implementation is many years off. I understand v. A. Hopes to speed up this time. V. A. Has several other supply chain efforts underway. For example, v. A. Will implement regional Readiness Centers to address challenges relying on just Inventory Management stem for ppe during national emergencies. V. A. Is developing a new iteration of its medical prime Vendor Program. Our forthcoming report identifies challenges with existing program. By 2. 0. Ht be addressed ofy reported back order frequently used items that were sometimes significant. In many cases, medical staff said they were able to get items work with the when ordering directly through the manufacturer then going through the prime Vendor Program. More 2. 0, they plan to stately wire vendors to maintain a 30 day supply stop. It will take time to rise the delayedent as v. A. Has mentation from april 2020 to early 2021. Addressore, it will not all challenges, such as management that can lead to errors, rejected waters and greater administrative burdens for the staff. They are piloting the use of the program to determine if it is more efficient. The pilot has already been delayed by almost a year and it lacks a methodology to measure pilot success and scalability. In conclusion, the v. A. Has a lot of irons in the fire, intended to transform. It is important to recognize that none of them would have completely shielded them. However, many of these effort will dramatically change how the v. A. Does business. It makes thoughtful planning and execution all the more important. The goals are commendable and would go a long way towards acquisition management. Chairman and members of the subcommittee, this concludes my statement. I am happy to take any question. Our final witness is the president of the coalition for government procurement. I will remind him to pause a few seconds before beginning. You have five minutes. Chairman, members of the committee, thank you for the opportunity to appear before you today to address the challenges that Veterans Affairs faces. I am the president of the coalition of procurement. Focusing on the v. A. Supply chain and its role to deliver health care to our nations veterans. A nonprofit, nonpartisan association of small, em and. Arge organizations medium and Large Businesses representing more than 145 billion in commercial contract purchases. Members provide 12 billion in medical and surgical products. Today, i asked that it being included into the record. Coalition members strongly support the implementation of the Program Office to develop requirements. They are available through the program through National Contracts and through the federal supply schedule. A clinically led Program Office serves as the bridge between Program Office as a general requirement. It identifies, collects and analyzes and communicate requirements across the department. It is vital that the program be managed and led. In addition, it should support medical element. Further, it should serve as a point of contact to interface with industry. It would provide a clear, direct channel through which it could Engagement Department and sharing the latest development. Engagement with industry is just one factor. Providers and analysis of data. Development ofhe a comprehensive formula. Undermines the formula because it fails to provide data. Treatment centers use a purchase card. Result, it lacks the data necessary to improve. To reflectnhance clinical needs. The resulting purchases would provide sound data when combined with clinical input. It would enable to standardized product can coreys categories, wherever. Our first step in expanding the line,a to offer product. Hinking and choosing Coali