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Veterans services scrutinized

Audit warns waste, fraud threaten city agency

By Stephen Kurkjian
Globe Correspondent / March 28, 2011

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The grandson of one elderly Boston veteran and the daughter of an 85-year-old East Boston widow of a veteran have each been paid thousands of dollars a month by the city’s Veterans’ Services Department recently to provide home health care even though they have no formal training in providing the care.

Although the US Veterans Administration mandates that anyone being paid to provide home health care to a veteran under its oversight be certified by a professional care association, no such requirement exists for veterans receiving benefits through the City of Boston. A veteran or widow of a veteran can have a family member, even one living in his or her house, paid for such care as long as the city approves it.

That is one of several troubling findings of a three-month review of the procedures and management practices inside the Boston Veterans’ Services Department, which provides more than $3.8 million worth of benefits annually to about 730 Boston veterans who are indigent or homeless, and their dependents.

A draft of the study, which was read by the Globe last week, described a department rife with the potential for waste and fraud. Approvals for whether an applicant was eligible for monthly stipends or other benefits — such as payments for home health care, housing, and even burials — were rarely, if ever, verified by supervisors in the department.

“No policies or procedures presently exist that establish threshold criteria or require documentation for the reimbursements paid out of [the department’s] revolving fund,’’ the 34-page report stated.

Persuaded that overhauls recommended by the study would occur with new leadership, the longtime veteran services commissioner, Eugene Vaillancourt, has agreed to step down from his post after Memorial Day’s commemorations at the end of May, said city administration officials, who asked not to be identified because an official announcement was still being planned. Vaillancourt informed a dozen or so staff members of his decision late last week.

The review by the independent auditing firm of Ernst & Young was ordered by Mayor Thomas M. Menino after a team of Boston and State Police officers assigned to the office of Suffolk District Attorney Daniel F. Conley initiated a criminal investigation into activities by one employee of the department.

That investigation of Joseph H. Miller, one of several department investigators responsible for reviewing the eligibility of those Boston veterans to receive the benefits, is in its final stages and is expected to be completed soon, officials said.

Miller, who has been on paid suspension from his $51,000-a-year position since the inquiry into accusations of fraud began in late November, could not be reached for comment. In an interview in February, he confirmed that the investigators were trying to determine if he had sought or taken any money in exchange from those for whom he had approved payments, including for home health care services. He denied taking any kickbacks.

The management review has been taking place while the criminal investigation proceeded. In addition, Joseph H. Callahan Jr., deputy corporation counsel for the city, has overseen the department’s operation while the inquiries continued.

Although the number of veterans who have sought the stipend, up to $2,000 a month, has risen in recent years, the report showed that the department still works with many of the tools and protocol used at the end of World War II, when it was established.

Among other things, few of the department’s data are computerized. Instead, most records are maintained in paper files and on handwritten cards. Also, there are no standard operating procedures for processing or paying claims, and except for sign-offs by the state Department of Veterans’ Services, which reimburses the city for 75 percent of its payments, no oversight of approvals are made by the city’s investigators.

Coleman Nee, head of state Veterans’ Services, said on Friday that his department had reviewed its files of Boston cases in recent weeks and had found the need to obtain further documentation for 71 of Boston’s cases.

The Ernst & Young study found the department’s administrative functions to be in such dire shape that it recommended “immediate attention’’ be given — within 30 to 60 days — to 17 of the 29 issues that it identified as needing remedy. “If not remediated, [the areas] would contribute to the possibility of a fraudulent act or critical mistake,’’ the report concluded.

In addition to implementing the overhauls, the Menino administration is hoping the department will begin an outreach program to veterans of more recent conflicts. The department’s current caseload shows that nearly three-quarters of the veterans it is aiding served in Vietnam, Korea, or World War II. Less than 10 percent are veterans of Iraq and Afghanistan.

Stephen Kurkjian can be reached at Kurkjian@globe.com.