June 16, 2016 2015-121
The Governor of California
President pro Tempore of the Senate
Speaker of the Assembly
Sacramento, California 95814
Dear Governor and Legislative Leaders:
As requested by the Joint Legislative Audit Committee, the California State Auditor presents this audit report concerning the policies and procedures for the planning, development, and implementation of the California Department of Veterans Affairs’ (CalVet) Enterprise-Wide Veterans Home Information System (system).
This report concludes that CalVet paid nearly $28 million for the implementation of a system that has not improved the veterans homes’ process for documenting medical care or reduced the homes’ reliance on paper records, as it was intended to do. In addition, system instability and concerns about functionality resulted in CalVet implementing fewer system functions at some homes than originally planned, thus limiting CalVet’s ability to provide more consistent, efficient care for veterans. CalVet’s project management failed to promptly identify and address the system’s functionality issues. Although it was aware of the problems as early as mid-2012, CalVet did not begin to address them until late 2013, and the steps it did take did not ultimately fix the problems. Further, although the California Department of Technology (Technology Department) facilitated the contract dispute negotiations between CalVet and the system contractor, it could not provide sufficient documentation to demonstrate its efforts to ensure that the agreements reached were in the best interests of the State.
Several key deficiencies contributed to CalVet’s failure to implement a system that meets its needs. CalVet did not exercise adequate oversight of its system project. Specifically, it did not complete or partially completed six of the 12 management oversight plans required by state policy for ensuring effective project management. For the six completed plans, CalVet fully followed only four. For instance, it did not consistently conduct impact analyses on change requests, and therefore was unable to demonstrate that it properly understood the impact of various change requests on the project’s costs, scope, and timelines. CalVet also hired an oversight contractor to provide both independent project oversight (IPO) and independent verification and validation services for its system project, but that oversight contractor’s work was inadequate, and by using the same contractor to perform both services, CalVet did not ensure it had effective oversight. The Technology Department also did not adequately fulfill its oversight responsibilities for CalVet’s system project. Specifically, it did not identify significant concerns with the system until August 2012. The Technology Department indicated that because of the nature of its oversight for this project—consisting of reviewing reports created by the oversight contractor—and because the reports did not indicate any critical errors with the project, the Technology Department did not raise any concerns. However, our information technology expert reviewed the IPO reports and indicated that they were consistently lacking in critical analysis, and that this omission alone should have been a red flag triggering the Technology Department’s closer review and inspection.
ELAINE M. HOWLE, CPA