Indian Health Service promises to locate missing property

Indian Health Service representatives have told a watchdog agency that they are confident an updated property management system will help locate millions of dollars in equipment investigators labeled as lost or stolen.

The statement came in response to a Government Accountability Office report that found 1,400 items worth about $3.5 million were lost or stolen from IHS facilities between October 2007 and January 2009. The agency is looking for an additional $14.5 million in items that could be added to the list, GAO said. Government Executive reported on a draft of the study last month, but the agency declined to comment at the time.

In a written response to the final version (GAO-09-450), released on Wednesday, officials agreed with all six recommendations to strengthen IHS' property management policies, but appeared to take issue with some of GAO's specific findings.

"Although GAO estimates the number of lost, stolen or unaccounted for property, IHS is confident that most, if not all, inventory currently unaccounted for will be identified as a result of implementation of the new and more accurate [Property Management Information System]," wrote Barbara Pisaro Clark, acting assistant secretary for legislation at the Health and Human Services Department, the parent agency of IHS.

Clark said employees are being trained on the PMIS system -- which she said will accurately account for all purchases and distribution of inventory -- and on IHS property policies and guidelines.

IHS officials have identified property management as a core problem for 12 years. In June 2008, GAO reported that nearly 5,000 items worth almost $16 million went missing from 2004 to 2007. As they did with the new report, investigators blamed management failures and weak leadership.

But Clark rejected GAO's premise. "IHS and its leadership have been and remain committed to proper and accountable property management," she wrote. "As such, IHS has dedicated thousands of hours of manpower to respond to all GAO requests and implementation of GAO's recommendations beginning in August 2007 through March 2009."

Clark also countered charges that IHS was not holding employees responsible for missing property. She noted that federal prosecutors declined to pursue the case of an IHS property employee who allegedly fabricated documents and held a yard sale of agency equipment in Nevada. The HHS inspector general had referred the case to the U.S. Attorney's Office for the Southern District of Maryland, she said.

GAO appeared unsatisfied with the agency's response, noting: "Numerous significant issues raised by our report were not addressed. Specifically, we are concerned that HHS did not acknowledge the rate of property loss at IHS and the continuing lack of employee accountability for millions of dollars of lost and stolen property."

Investigators further suggested that after two years PMIS still lacks complete and accurate data. Rather than relying solely on the new system, GAO recommended IHS actively manage its property and enforce existing HHS policies. This would include conducting annual inventories, issuing hand receipts and improving physical security measures.

"Given the chronic nature of the problem," the report said, "IHS should be prepared to spend additional hours in the future, and should dedicate resources to enforcement and compliance when, and if, the significant challenges it faces have been resolved."