According to a confidential federal report, employees at the VA Loma Linda Healthcare System, in California, mismanaged more than $1 million in patient transportation funding through illegal “handshake” agreements with ambulance and other transport companies.

VA Loma Linda is made up of the Jerry L. Pettis Memorial Veterans' Hospital and eight ambulatory care centers that altogether serve over 76,000 veterans.

Between October 2019 and May 2022, employees with the Veterans Transportation Services unit there and the Transfer Center approved vendor invoices without reviewing them and made unauthorized payments for transport services that VA Loma Linda was responsible for or that were outside of the transport companies’ contract parameters, reported Redlands Daily Facts, of the Southern California News Group.

An employee told the health system in April 2021 that the transportation program was ignoring requirements to reduce bed occupancy and improve wait-time metrics. This led to an investigation by a VA three-member, fact-finding team, who wrote the report and later turned the case over to the VA Office of Inspector General (OIG).

Among their illicit activities were "irresponsible billing/payment oversight, inappropriate information sharing, potential kickbacks to VA employees from vendors, illegal contractual relationships, and potential disallowed staff/vendor relationships,” said the report, which listed personal gain as a potential reason.

One employee, mobility manager Louis Garcia paid wheelchair van company Journey $170,000 to $180,000 every two weeks for unreviewed and nonitemized invoices and additional charges for outside parameter pickups. In over four months, Journey billed VA Loma Linda $1.1 million for rides, with only $500,565 of the charges deemed payable. When confronted, Garcia said no one completed any audits, and pretended to not know what he was doing, and asked for training.

The Transfer Center also approved $250,000 to $300,000 payments per month without approval from VA Loma Linda’s mobility management staff, and allowed patients to schedule rides with ambulance companies directly. VA Loma Linda Medical Director Karandeep Sraon gave the Transfer Center staff permission to approve interfacility care transportation, despite this being the mobility manager’s responsibility.

Investigators also found that executives pressured employees to sign a $1 million ratification to show that they approved the unauthorized ambulance payments.

“Congress needs to hold VA senior management accountable, and VA senior management needs to hold employees accountable,” Darin Selnick, a senior adviser to Concerned Veterans for America, in Virginia, told Redlands Daily Facts, adding that handshake agreements are a growing problem in the U.S.

Since then, the company has received complaints from several transport companies for failing to pay outstanding invoices, with its mobility management staff refusing to because many of the charges were unapproved.

In addition to funding mismanagement, the company is also being investigated for employing a man whom sources say is grounds department supervisor Martin Robles, who is alleged to have created a toxic work environment by harassing and retaliating against other workers. Despite being the subject of three federal investigations — one of which recommended he be fired — VA Loma Linda instead promoted him, and he remains employed there.

EDIT 9/15: An earlier version of this story erroneously said that the report in question was published by the VA OIG. The report was completed by VA three-member, fact-finding team which later turned the case over to the VA OIG. HCB News has corrected this information and apologizes for the error.