<DOC>
[106th Congress House Hearings]
[From the U.S. Government Printing Office via GPO Access]
[DOCID: f:67017.wais]
COMBATING TERRORISM: MANAGEMENT OF MEDICAL SUPPLIES
=======================================================================
HEARING
before the
SUBCOMMITTEE ON NATIONAL SECURITY,
VETERANS AFFAIRS, AND INTERNATIONAL
RELATIONS
of the
COMMITTEE ON
GOVERNMENT REFORM
HOUSE OF REPRESENTATIVES
ONE HUNDRED SIXTH CONGRESS
SECOND SESSION
__________
MARCH 8, 2000
__________
Serial No. 106-159
__________
Printed for the use of the Committee on Government Reform
Available via the World Wide Web: http://www.gpo.gov/congress/house
http://www.house.gov/reform
__________
U.S. GOVERNMENT PRINTING OFFICE
67-017 WASHINGTON : 2000
______
COMMITTEE ON GOVERNMENT REFORM
DAN BURTON, Indiana, Chairman
BENJAMIN A. GILMAN, New York HENRY A. WAXMAN, California
CONSTANCE A. MORELLA, Maryland TOM LANTOS, California
CHRISTOPHER SHAYS, Connecticut ROBERT E. WISE, Jr., West Virginia
ILEANA ROS-LEHTINEN, Florida MAJOR R. OWENS, New York
JOHN M. McHUGH, New York EDOLPHUS TOWNS, New York
STEPHEN HORN, California PAUL E. KANJORSKI, Pennsylvania
JOHN L. MICA, Florida PATSY T. MINK, Hawaii
THOMAS M. DAVIS, Virginia CAROLYN B. MALONEY, New York
DAVID M. McINTOSH, Indiana ELEANOR HOLMES NORTON, Washington,
MARK E. SOUDER, Indiana DC
JOE SCARBOROUGH, Florida CHAKA FATTAH, Pennsylvania
STEVEN C. LaTOURETTE, Ohio ELIJAH E. CUMMINGS, Maryland
MARSHALL ``MARK'' SANFORD, South DENNIS J. KUCINICH, Ohio
Carolina ROD R. BLAGOJEVICH, Illinois
BOB BARR, Georgia DANNY K. DAVIS, Illinois
DAN MILLER, Florida JOHN F. TIERNEY, Massachusetts
ASA HUTCHINSON, Arkansas JIM TURNER, Texas
LEE TERRY, Nebraska THOMAS H. ALLEN, Maine
JUDY BIGGERT, Illinois HAROLD E. FORD, Jr., Tennessee
GREG WALDEN, Oregon JANICE D. SCHAKOWSKY, Illinois
DOUG OSE, California ------
PAUL RYAN, Wisconsin BERNARD SANDERS, Vermont
HELEN CHENOWETH-HAGE, Idaho (Independent)
DAVID VITTER, Louisiana
Kevin Binger, Staff Director
Daniel R. Moll, Deputy Staff Director
David A. Kass, Deputy Counsel and Parliamentarian
Lisa Smith Arafune, Chief Clerk
Phil Schiliro, Minority Staff Director
------
Subcommittee on National Security, Veterans Affairs, and International
Relations
CHRISTOPHER SHAYS, Connecticut, Chairman
MARK E. SOUDER, Indiana ROD R. BLAGOJEVICH, Illinois
ILEANA ROS-LEHTINEN, Florida TOM LANTOS, California
JOHN M. McHUGH, New York ROBERT E. WISE, Jr., West Virginia
JOHN L. MICA, Florida JOHN F. TIERNEY, Massachusetts
DAVID M. McINTOSH, Indiana THOMAS H. ALLEN, Maine
MARSHALL ``MARK'' SANFORD, South EDOLPHUS TOWNS, New York
Carolina BERNARD SANDERS, Vermont
LEE TERRY, Nebraska (Independent)
JUDY BIGGERT, Illinois JANICE D. SCHAKOWSKY, Illinois
HELEN CHENOWETH-HAGE, Idaho
Ex Officio
DAN BURTON, Indiana HENRY A. WAXMAN, California
Lawrence J. Halloran, Staff Director and Counsel
Kristine McElroy, Professional Staff Member
Jason M. Chung, Clerk
David Rapallo, Minority Professional Staff Member
C O N T E N T S
----------
Page
Hearing held on March 8, 2000.................................... 1
Statement of:
Bascetta, Cynthia, Associate Director, Veterans Affairs and
Military Health Care Issues, General Accounting Office,
accompanied by Ronald Guthrie and Martin Eble.............. 4
Murphy, Frances, M.D., Acting Deputy Under Secretary for
Policy and Management, Department of Veterans Affairs,
accompanied by John Ogden; Robert F. Knouss, M.D., Office
of Emergency Preparedness, Public Health Service,
Department of Health and Human Services; Stephen M.
Ostroff, M.D., Associate Director for Epidemiologic
Science, National Center for Infectious Diseases, Centers
for Disease Control and Prevention, accompanied by Steven
Bice; and Colonel Carlos Hollifield, U.S. Marine Corps,
Chemical Biological Incident Response Force, accompanied by
Captain Warren (Rich) Dalton, M.D., U.S. Navy.............. 12
Letters, statements, et cetera, submitted for the record by:
Hollifield, Colonel Carlos, U.S. Marine Corps, Chemical
Biological Incident Response Force, prepared statement of.. 42
Knouss, Robert F., M.D., Office of Emergency Preparedness,
Public Health Service, Department of Health and Human
Services, prepared statement of............................ 22
Murphy, Frances, M.D., Acting Deputy Under Secretary for
Policy and Management, Department of Veterans Affairs,
prepared statement of...................................... 16
Ostroff, Stephen M., M.D., Associate Director for
Epidemiologic Science, National Center for Infectious
Diseases, Centers for Disease Control and Prevention,
prepared statement of...................................... 30
Shays, Hon. Christopher, a Representative in Congress from
the State of Connecticut, prepared statement of............ 3
COMBATING TERRORISM: MANAGEMENT OF MEDICAL SUPPLIES
----------
WEDNESDAY, MARCH 8, 2000
House of Representatives,
Subcommittee on National Security, Veterans
Affairs, and International Relations,
Committee on Government Reform,
Washington, DC.
The subcommittee met, pursuant to notice, at 10 a.m., in
room 2154, Rayburn House Office Building, Hon. Christopher
Shays (chairman of the subcommittee) presiding.
Present: Representatives Shays and Tierney.
Staff present: Lawrence J. Halloran, staff director and
counsel; J. Vincent Chase, chief investigator; Kristine
McElroy, professional staff member; Jason M. Chung, clerk;
David Rapallo, minority counsel; and Jean Gosa, minority
assistant clerk.
Mr. Shays. Good morning. I'd like to call this hearing to
order.
Pharmaceutical and vaccine stockpiles constitute a vital
and growing element of the national domestic preparedness
effort against terrorism. In the event of a chemical,
biological or nuclear incident, local hospitals will need
extraordinary quantities of antidotes, antibiotics and sera to
treat the victims. If the right medicines do no arrive quickly,
thousands could die.
Today, the Department of Health and Human Services' four
National Medical Response Teams are available to deploy with
medical supplies to treat up to 5,000 casualties each. The
Marine Corps' Chemical/Biological Incident Response Force also
maintains a supply of pharmaceuticals and equipment that could
be used to support local first responders. A larger National
Pharmaceutical Stockpile is being assembled by the Centers for
Disease Control.
To be useful, medical stockpiles must be carefully
maintained and well managed. So we asked the General Accounting
Office to assess the accuracy of current inventory tracking and
the adequacy of internal controls over critical stockpile
assets.
GAO found inventory shortfalls, recordkeeping discrepancies
and security lapses that compromised the ability to respond to
the chemical or biological incidents.
The fundamental cause of the problems was not the
complexity of the terrorism threat, or the logistics of a
multi-event response scenario, but the lack of the most basic
management controls. GAO found a critical national program
running on little more than Post-It notes and a spreadsheet.
The Marine Corps isn't even willing to concede their cache is a
``stockpile'' that needs to be managed like the others.
Terrorism poses any number of extremely difficult
challenges to our national security. Accounting for medical
stockpiles should be the easy part. Well recognized principles
of program design, inventory management and internal control
should be applied immediately to transform the current cottage
industry of stockpile management into the national enterprise
Congress intended.
The threat of domestic terrorism demands we amass, and
preposition, costly medical supplies we hope never to use. We
hope the very existence of stockpiles will deter terrorists.
But in the tragic event we are called upon to open the national
medicine cabinet, it must contain the types and amounts of
supplies needed to save lives.
In addition to testimony from GAO, we will hear today from
those responsible for management of the Nation's stockpiles. To
varying degrees, each has acknowledged GAO's findings and
pledged reforms. We look forward to their testimony.
[The prepared statement of Hon. Christopher Shays follows:]
[GRAPHIC] [TIFF OMITTED] T7017.001
Mr. Shays. Our first panel, and we have two, is GAO, Ms.
Cynthia Bascetta, Associate Director, Veterans Affairs and
Military Health Care Issues, U.S. General Accounting Office,
accompanied by Mr. Ronald Guthrie, Assistant Director. And
Martin Eble, Senior Evaluator, Accounting and Information
Management Division of GAO.
If you would rise, we'll swear you in and we'll get
started.
[Witnesses sworn.]
Mr. Shays. Ms. Bascetta, it's my understanding you will
give testimony and then we'll ask questions and all three will
respond to the questions we might ask.
Ms. Bascetta. That's correct.
Mr. Shays. Great to have you here. Thank you.
Ms. Bascetta. Thank you.
Mr. Shays. And also let me say to you, what we'll do is
we'll do 5 minutes but we'll roll it over. So you'll see the
first 5 minutes red light and then we'll roll you over again.
STATEMENT OF CYNTHIA BASCETTA, ASSOCIATE DIRECTOR, VETERANS
AFFAIRS AND MILITARY HEALTH CARE ISSUES, GENERAL ACCOUNTING
OFFICE, ACCOMPANIED BY RONALD GUTHRIE AND MARTIN EBLE
Ms. Bascetta: Mr. Chairman, thank you for inviting us to
discuss our report on the Federal medical stockpiles that would
be used to treat civilian victims of a chemical or a biological
terrorist attack. My testimony today will highlight weaknesses
in management at the stockpiles, the results of our count of
stockpiled supplies, and the progress the agencies have made
since we issued our report about 3 months ago.
At that time, we reported that OEP, VA, and the Marine
Corps unit known as CBIRF did not have basic internal controls
in place to manage their stockpiles. As a result when we
counted the inventory, we identified discrepancies between what
should have been on hand and what was actually there. We found
excesses of supplies such as sterile gloves, as well as
shortages of some antidotes and antibiotics. For example, in
one location we found 1,000 fewer diazepam injectors than
required. Diazepam, also known as Valium, would be administered
to calm victims and control convulsions. Although VA contends
that it stockpiled a substitute for these injectors, it could
not produce written documentation of OEP's approval at the time
of the substitution. At another location, the entire supply of
amyl nitrate--an antidote for cyanide poisoning--had been
expired for 8 months. We also found incorrectly recorded
expiration dates and lot numbers, which are necessary to keep
supplies current and to respond to potential manufacturer
recalls. At one location this information was wrong for 250
doxycycline tablets and 100 cipro tablets, two antibiotics used
to prevent the onset of symptoms in people exposed to anthrax.
To improve stockpile management, we recommended that VA,
OEP and CBIRF each establish fundamental internal controls,
which serve as the first line of defense in safeguarding assets
like these stockpiles. Incorporated in OMB Circular A-123,
internal control is essential to managing an organization and
it compromises the plan, methods and procedures used to meet
missions, goals and objectives--in this case, the critical
mission to save lives in the event of biochemical terrorism.
We identified the lack of internal control as the root
cause of the inventory discrepancies we found in our review.
Until this is corrected, the responsible agencies cannot
provide reasonable assurance that all the stockpiled items will
be current, accounted for, and available for use. For example,
at the time of our review, the systems lacked basic information
required for sound recordkeeping, including documentation of
back orders, replacements, and the shipment and receipt of
pharmaceuticals and medical supplies. Further, none of the
agencies conducted periodic inventories of the stocks they had
on hand to compare them with required amounts.
Moreover, security was lax at some locations. We found
commingling of stockpiled items with other VA Medical Center
pharmaceuticals, sometimes in unsecured refrigerators. While
CBIRF's overall security was much better, it could not ensure
that proper access was maintained because no logs were kept for
recording access to its warehouse and trucks where the working
stock is stored.
Mr. Chairman, we're encouraged that OEP, VA, and CBIRF
concurred with all our recommendations and have committed to
improving stockpile management. In fact, the current memorandum
of agreement between VA and OEP appears to incorporate much of
our advice for improving stockpile management. So does VA's new
agreement with CDC, which as you know is responsible for a new
and vastly larger pharmaceutical stockpile. Specifically, CDC's
agreement includes provisions for unannounced inspections and
specific remedial actions with timeframes for completion if
VA's performance is unsatisfactory. In addition, VA told us
that it has prepared a plan indicating its commitment to
conduct risk assessment of its vulnerabilities, to arrange for
annual inventories, to implement the tracking system for the
complete documentation of all transactions, and to rotate
supplies properly. CBIRF is working on a list of required items
but it needs to expedite this because it is pivotal to
implementing our recommendations.
In conclusion, we believe the agencies should be able to
turn this situation around and, because of the criticality of
this mission they should do so expeditiously. Since this is
not, in my view, an expensive problem to fix, how quickly and
effectively they will be able to depends less on resources and
more on their commitment to implement an organized and
disciplined response to our findings. Placing higher priority
on this effort at the highest management levels will be
essential to ensuring better stewardship of the stockpiles and,
as a result, mitigating as best as possible the potential
consequences of a terrorist attack.
This concludes my remarks. We'd be happy to answer any
questions you might have.
Mr. Shays. Thank you. It's my understanding that your
investigation didn't look at what supplies should be there, but
how the supplies were being maintained.
Ms. Bascetta. That's correct.
Mr. Shays. Did one of the three of you, or all of you,
visit all four sites?
Ms. Bascetta. We visited five sites.
Mr. Shays. Right.
Ms. Bascetta. The four NMRT sites.
Mr. Shays. Four VAs?
Ms. Bascetta. Yes. And also the CBIRF site.
Mr. Shays. Describe to me what the--I don't even know what
the site would look like.
What is the--describe to me, I mean is it a small room, is
it a large room? Do we have trucks with supplies? Just describe
to me what it looks like.
Ms. Bascetta. There is some variability. I have been at one
of the sites and it's located at a VA Medical Center. I'm not
sure, but----
Mr. Shays. Which State?
Ms. Bascetta. Washington, DC. I'm not sure of the
dimensions of the stockpile, but it's a secured area. It's
called a cage, and inside this cage are a number of pallets
that have boxes on the pallets, and they're all shrink-wrapped.
They're on pallets so that they can be moved easily.
I don't know if Ron or Marty would like to describe what
some of the conditions are like in some of the other areas.
Mr. Shays. I'd like to have it all. I'd like you to
contrast some of the sites and so on.
Ms. Bascetta. OK.
Mr. Eble. Mr. Chairman, I visited the Hines location. This
is also a VA facility. This is in Chicago, just outside of
Chicago at Hines, IL. And it's set up very much like Ms.
Bascetta is describing within--in this case within a
pharmaceutical facility, a large, caged, locked room. And the
pharmaceuticals for this purpose are segregated from the other
items there and locked.
Mr. Shays. I'm just trying to get some basic area of what
you're talking about. It seems to me like that this is not a
big deal in terms of being able to store this and to keep
records, and it strikes me that obviously there are some of the
pharmaceuticals that may expire and you have to replace them.
Mr. Eble. Right.
Mr. Shays. I would imagine some would have to be cooled.
Ms. Bascetta. That's correct.
Mr. Shays. And I just want to know if you saw a consistency
in all five sites. I want to know if we're talking about a
small room, 10x10, if we're talking about a very large place,
with some already on trucks. I just want to have a sense of
what----
Mr. Eble. This would be small location, perhaps 10X10 or
15X15.
Mr. Shays. I mean, you could almost store it in one of
these public storage spaces?
Mr. Eble. In a garage. Right, that's correct.
Ms. Bascetta. That's about the dimension.
Mr. Guthrie. Essentially, Mr. Chairman, there are
essentially six to eight pallets. And pallets are typically 4x4
or 5x5 and the goods are stacked perhaps 3 to 5 feet high on
each one of these pallets. So if you can envision an area
that's perhaps as large as the space in front of us here, it's
a caged area usually with solid masonry walls behind and a
screen, like a screen fencing, a fairly rigid fencing with a
locked screen door. That's rather typical. It's kind of a
warehouse feeling environment to it. And it typically would
have a small refrigerator inside that space to house
pharmaceuticals that must be refrigerated.
Mr. Shays. We don't need to know the exact location of
these sites since, actually, security is important. But I want
to also get a feeling for the number of different types of
things that we have to record. Are we talking about 100 items,
are we talking about 5,000 items, what are we talking about?
Ms. Bascetta. About 200,000 items is the denominator in the
counts that we did, in the inventory counts that we did.
Mr. Shays. And 200,000 items and there are groupings within
each so are you----
Ms. Bascetta. Three of the sites have 35,000 items of
primarily medical supplies. Not antidotes or antibiotics. Those
are in smaller quantities.
Mr. Shays. I'm just trying to now get a sense of what your
major concern is and then what your second biggest concern
would be and just go down.
What's your first--and let me ask you, when you were doing
your investigation, are we talking about things in the margin,
or are we talking about some very serious problems?
Ms. Bascetta. In terms of the specific significance of the
shortages that we found, we didn't make a judgment as to the
criticality of those specific shortages to the mission. Our
concern was that because of the failure in the underlying
systems to be able to track what's in the stockpiles and to be
able to assure currency and their availability for use, that we
wouldn't be able to tell from time to time how adequately
maintained those stockpiles were.
That's our major message. It's less a message that focuses
on the specific findings of our inventory count, which we
consider symptomatic of the more serious underlying problem of
the need to have systems in place that can track the stockpiled
items.
Mr. Shays. Are you saying that we were not--did they have
records of what they have, but they simply didn't have the
quantities they needed? Or did they not even have the records
to say what was actually in the cage?
Ms. Bascetta. Sometimes they didn't have the correct
quantities, but the bigger problem was that they didn't have,
for example, historical documentation of what had been
replaced. And so there was no way over time to track how the
stockpile had been maintained.
Mr. Shays. Just tell me the method you used to examine the
inventory in the stockpile material. What was the method?
Ms. Bascetta. Sure. I'd be happy to and this might help
give you a sense of how manageable these stockpiles are in
terms of their size and dimensions.
I'm also glad that you asked this question because the
agencies, although they concur with our recommendations, do
take issue with our count.
What we did was, of course, because of our timeframes, we
wanted to go onsite immediately, but VA was uncomfortable with
that. They wanted a few weeks to do some pre-inventories before
we arrived.
Mr. Shays. I don't understand that at all. Why wouldn't the
best way of knowing the condition have been to go in right away
and just check it out?
Ms. Bascetta. Well, it would have been and that certainly
would have been our preference, although we were concerned more
about the systems again then the actual counts. So we were
willing to accommodate them on their request to give them a
little bit more time.
When we arrived onsite we did a 100 percent count of every
single item in the stockpile. We did not use a sampling
approach so that----
Mr. Shays. In all five sites?
Ms. Bascetta. Yes, that's correct. So, there you know that
if we were able to do it in a matter of days, it's a manageable
task.
Mr. Shays. Right.
Ms. Bascetta. We also ensured that VA program staff were
present at every location while we were counting. And when we
noted discrepancies, we brought them to the attention of the VA
personnel onsite with us. And in all cases they recounted
except in California, where toward the end of our work they
chose not to recount.
In no instance did they inform us that we had counted
incorrectly while we were onsite. It was only after our report
was issued that they raised some questions about substitutions
and nomenclature issues that they think might have caused us to
miscount.
And the final issue that I want to clarify for the record
is that while the agencies believe that our count of errors is
inflated, we want to explain that that is truly the accurate
way to measure deficiencies in the systems. What we did was
count multiple errors for a single item. And that's because if
an item had, for example, a wrong expiration and a wrong lot
number, that would require two corrective actions to make the
system accurate.
So, our discrepancy rate does account for multiple errors
for a single item, but we believe that's the correct way to
measure the systems.
Mr. Shays. Now, for the record just tell me how the lack of
management controls affects management of the stockpiles.
Ms. Bascetta. How a lack of management----
Mr. Shays. How the lack of the internal controls affects
the management of the stockpile.
Ms. Bascetta. Well, there are several dimensions of
internal controls that need to be in place to give stockpile
management the appropriate attention. First, you need to
establish an environment in which the staff who are involved
place an appropriate priority on stockpile management and not
in a singular fashion, but in a continuous fashion. It's an
iterative process that needs to have a high level of attention
over an extended period of time.
In addition, all of the policies and procedures that you
would have in place, such as those that are reflected in our
Standards for Internal Control and in OMB Circular A-123,
pretty much spell out what you need to do to ensure that your
inventories are accurately maintained.
Mr. Shays. This may seem like somewhat of a digression, but
I'm having a hard time understanding why it is we would have
any problems whatsoever. I mean, when I go and get my car
repaired, I go the parts desk of the automobile dealer and they
can, on their computer, tell me what they have. They can show
me pictures of it. They can decide they only have three left or
two left or they're going to order it and they're going to get
it in a few days. I mean, so this is not rocket science-kind of
management skills, is it?
Ms. Bascetta. No, it's pretty straightforward inventory
control. I agree with you.
Mr. Shays. To what extent have the agencies tried to
implement your recommendations?
Ms. Bascetta. Well, right now what we have is their letters
to us concurring with our recommendations. And our best
evidence of their actions are the agreements that they've
signed with VA. And those appear to be much better than the
previous agreement that VA had with OEP. As you know, this is
CDC's first agreement with VA and they quite proactively
incorporated many of our recommendations to prevent the kind of
problems that we had identified in the VA OEP situation. I'd
say that if they implement what is in those current agreements
and they give it appropriate management attention, they ought
to be able to fix the problems that we identified.
Mr. Shays. What internal controls did you find in place to
ensure that the requests and draw-downs for the medical
supplies from national stockpiles were properly authorized?
Ms. Bascetta. I don't think we----
Mr. Guthrie. Mr. Chairman, I don't know that there have
been draw downs per se. These are pretty static stockpiles and
it would be the rare event where they would draw down on these
stockpiles.
Mr. Shays. If a draw down were to occur, how would they
record it?
Mr. Guthrie. I don't know that we covered that during the
course of our review, sir.
Mr. Shays. Is this the same--I've asked you about the four
VA facilities, but how about the Marine facility, describe to
me how it would compare.
Ms. Bascetta. The Marine----
Mr. Shays. Do they stockpile the same basic
pharmaceuticals, and so on?
Ms. Bascetta. They have similar types of items in their
stockpile, emergency supplies and a variety of antidotes that
would be used. They refer to their stockpile--they refer to
their supplies as a working stock. They object to the word
``stockpile.'' But it seems to us----
Mr. Shays. Why would they object to that?
Ms. Bascetta. Well, we're not sure, to be honest. It seems
to us to be a semantic difference. And to us the important part
is that whether they call it a working stock or a stockpile,
they agree that it needs to be managed in accordance with the
standards that we laid out.
Mr. Shays. Does a working stock mean they continually roll
over and take things out? I mean, what's the significance of
that? I'll ask them, but what is your sense of the
significance?
Ms. Bascetta. The way we understand it, the supplies would
be handled similarly to the NMRT sites in that they're
deployable supplies. So we really don't see much of a
distinction. The other issue that they raise is that their
working stock is internal to their unit. They have primarily a
military mission rather than a civilian mission. But on the
other hand they do acknowledge that in the event of an
emergency, if they show up onsite and the locals don't have
supplies, they will treat civilians in those situations.
Mr. Shays. Do they have supplies that are just for, say,
children?
Ms. Bascetta. They do.
Mr. Shays. So that would strike me--as they don't have
children in the Marines, so they obviously have some supplies
for civilians. And that makes sense.
Ms. Bascetta. It seems that way. And they also appear to
have thousands more of certain items than they would need for
their own internal use.
Mr. Shays. Great.
Mr. Tierney, nice to have you here.
Mr. Tierney. I want to thank the members of the panel for
coming forward today. And I apologize for my tardiness. I have
read your testimony in addition to listening to what you have
to say, and I don't have very many questions in addition to the
chairman's. I think he covered the ground pretty well.
But I am curious to know, when you were dealing with the
folks that are responsible for these measures, did you find any
glaring lack of training or glaring lack of unfamiliarity with
your standards?
Ms. Bascetta. Yes, I'd say that we did. We're not certain
whether the reason is that there simply wasn't enough attention
put on the kinds of skills that a person would need to have to
handle this kind of an effort, but we did notice that people
with financial background or with any kind of accounting were
not in the picture and that had those skill sets been brought
to bear, we don't think that this would have happened or
certainly not to this degree.
Mr. Tierney. And was that right across the board, VA, the
Marines?
Ms. Bascetta. Yes.
Mr. Tierney. How about the management skills on that, did
you find that the people that were responsible overall for it
had the skills and just lacked the individuals beneath them
having those appropriate skills and training, or do you think
the management skills needed to be improved?
Ms. Bascetta. I don't think that it was a problem of
management skills as much as a problem of lack of attention. I
simply think this wasn't given high enough priority. It just
didn't seem to be on everybody's radar screen at an appropriate
level.
Mr. Tierney. I was a little concerned about what appeared
to be in your testimony, a lack of internal oversight or
mechanisms to assure that they were doing what they ought to be
doing. And so nobody was watching anybody else and sometimes
somebody was doing all the functions instead of dividing them
so that you make sure errors would be caught.
Ms. Bascetta. Right.
Mr. Tierney. Have you noticed any marked improvement in
those areas since your report in dealing with those companies?
Ms. Bascetta. We see that they have policies and procedures
in place to follow those standards, but we haven't been back to
verify that, in fact, that's what's happening.
Mr. Tierney. When will you go back for that?
Ms. Bascetta. We haven't been asked.
Mr. Tierney. OK, fair enough. Thank you very much.
Mr. Shays. I just have one other question in terms of the
draw downs. I understand they haven't drawn down, but did you
look the procedures of how they draw them down? Did you ask
them what they would do and how they would do it or did you
just not?
Ms. Bascetta. We really focused only on what was actually
physically in the stockpile. I suppose that if there had been
those kinds of procedures in place we would have reviewed them
as well. And certainly they should be spelled out in their new
policies and procedures.
Mr. Shays. You weren't asked to do this, but were you--I
mean, these are four sites in the country that then may go
somewhere else.
Ms. Bascetta. Right.
Mr. Shays. Did you have a sense intuitively when you saw
these sites that they were in a reasonable location, near an
airport, so that we could get these to where they needed to go
in a few hours, not days?
Ms. Bascetta. I think that's fair to say, yes. That they
were appropriately positioned.
Mr. Shays. OK. Thank you very much. You've given us an
opportunity now to meet with the next panel. Thank you.
Our second panel is Dr. Frances Murphy, acting Deputy Under
Secretary for Policy at the Department of Veterans Affairs,
accompanied by Mr. John Ogden, Chief Consultant, Pharmacy
Benefits Management Strategic Health Group, Department of
Veterans Affairs; testimony from Dr. Robert Knouss, Office of
Emergency Preparedness, Public Health Service, Department of
Health and Human Services; Dr. Steven Ostroff, Associate
Director for Epidemiologic Science, National Center for
Infectious Diseases, Center for Disease Control and Prevention,
accompanied by Mr. Steve Bice, Branch Chief, National
Pharmaceutical Stockpile Branch, Department of Health and Human
Services, and our fourth testimony is from Colonel Carlos
Hollifield, Chemical Biological Incident Response Force, U.S.
Marine Corps, Department of Defense, accompanied by Captain
Warren Rich Dalton, M.D.--so, Doctor, Biological Incident
Response Force, with the Marines as well.
Do you have everybody at the table?
Now, let me just say, I'm going to swear you all in, but I
just have to first take care of some procedural things from the
committee, unanimous consent, and we're going to welcome your
testimony and have it basically be as long as you need it to
be.
I ask unanimous consent that all members of the
subcommittee be permitted to place an opening statement in the
record and that the record remain open for 3 days for that
purpose. Without objection, so ordered.
And I ask further unanimous consent that all witnesses be
permitted to include their written statements in the record.
And without objection, so ordered.
Again, we'll do the 5-minutes, we'll roll it over again for
another 5 minutes, but if you feel that you need to say
something and can't do it within the 10-minutes I want it part
of the record and am happy to have you do that.
Dr. Murphy, we're just going to start with you and then
we'll go to Dr. Knouss and go right down the line, Dr. Ostroff,
and then Colonel Hollifield.
You're on.
STATEMENTS OF FRANCES MURPHY, M.D., ACTING DEPUTY UNDER
SECRETARY FOR POLICY AND MANAGEMENT, DEPARTMENT OF VETERANS
AFFAIRS, ACCOMPANIED BY JOHN OGDEN; ROBERT F. KNOUSS, M.D.,
OFFICE OF EMERGENCY PREPAREDNESS, PUBLIC HEALTH SERVICE,
DEPARTMENT OF HEALTH AND HUMAN SERVICES; STEPHEN M. OSTROFF,
M.D., ASSOCIATE DIRECTOR FOR EPIDEMIOLOGIC SCIENCE, NATIONAL
CENTER FOR INFECTIOUS DISEASES, CENTERS FOR DISEASE CONTROL AND
PREVENTION, ACCOMPANIED BY STEVEN BICE; AND COLONEL CARLOS
HOLLIFIELD, U.S. MARINE CORPS, CHEMICAL BIOLOGICAL INCIDENT
RESPONSE FORCE, ACCOMPANIED BY CAPTAIN WARREN (RICH) DALTON,
M.D., U.S. NAVY
Dr. Murphy. Mr. Chairman and members of the subcommittee, I
am pleased to have this opportunity to address GAO's recent
report concerning managements of chemical and biological
medical supplies. I am accompanied by Mr. John Ogden, Chief
Consultant----
Mr. Shays. We swear in everyone who testifies, even Members
of Congress. Actually I didn't, Senator Byrd came and we didn't
administer the oath to him. I chickened out, but everyone else
who has come before us has.
I'm sorry, I'm going to have you start over again. My
apology.
[Witnesses sworn.]
Dr. Murphy. I'd like to enter my entire testimony in the
record if that would be possible, but to shorten the statement
this morning if I could.
As you know, VA's primary mission is to provide health care
and benefits to veterans; however an additional VA role is to
ensure health care for eligible veterans, military personnel,
and the public during Department of Defense contingencies,
natural, man-made, and technological emergencies. VA has
assigned lead responsibility for this mission to the Emergency
Management Strategic Health Care Group, which is headquartered
in Martinsburg, WV. The primary responsibilities and
authorities governing VA's program implementation are to serve
as a VA/DOD Contingency Hospital System backup, which requires
VA to serve as the primary backup to DOD medical services in
times of national emergencies.
We also act as part of the National Disaster Medical
Defense System. VA operates to provide capability for treating
large numbers of patients who are injured in major peacetime
disasters in the United States and its territories, or to treat
casualties resulting from conventional military conflict
overseas.
In addition, Presidential Review Decision Directive 62,
Combating Terrorism, which was issued in May 1998, tasked the
U.S. Public Health Service to work with VA in ensuring that
adequate stockpiles of antidotes and other necessary
pharmaceuticals are maintained nationwide and to have the
ability to train medical personnel in NDMS hospitals.
Under the provisions of this plan over the past 9 years, VA
has deployed over 1,000 health care personnel, and provided
medical supplies, and equipment, including mobile health
clinics, and facilities.
In addition, under the Presidential Decision Directive and
as part of the NDMS system, VA has an agreement with the U.S.
Public Health Service to maintain the four caches that were
talked about in the GAO testimony this morning, at strategic
locations throughout the United States, that may be needed for
treatment of victims of an event involving weapons of mass
destruction. If such an event occurs, these caches would be
deployed to the site of the incident. These pharmaceuticals
would be used and could provide supplemental capability to
local medical caregivers and facilities to treat the victims of
the weapons of mass destruction.
VA also has entered into a recent agreement with the
Centers for Disease Control and Prevention to assist with
procurement and maintenance of the National Pharmaceutical
Stockpile that would also be located in specific cities
throughout the United States. In both of these instances VA
receives funds from the agencies involved to procure and
maintain these stockpiles for those respective agencies.
In response to the GAO Report on Management of Medical
Supplies, I am pleased to have an opportunity to discuss with
you VA's role and activity as a partner with HHS in
procurements, inventory storage and maintenance and delivery of
medical supplies that are needed for these responses.
The development and maintenance of these stockpiles are
integral parts of the Nation's ability to provide needed health
care following an emergency. We recognize the key and strategic
nature of this mission.
OEP officials determine the contents of those inventories;
they provide the funding for the procurement, maintenance and
deployment of the medical supplies; and they determine the
locations of the stockpile at these sites across the Unites
States. The partnership with the Office of Emergency
Preparedness and VA began in late 1995 and evolved into a
formal agreement by 1997.
This partnership has been extended now to a partnership
with CDC to maintain the National Pharmaceutical Stockpile
program.
With that background, I'd like to give you a sense of how
VA has responded to the GAO report recommendations. As you've
already heard, Mr. Chairman, we concurred with the GAO
recommendations and have taken action to correct the problems
that they identified. GAO recommended that OEP, CDC, and the
Marine Corps, and VA establish sufficient systems of internal
control over their chemical and biological stockpiles of
medical supplies and pharmaceuticals maintained for responding
to a terrorist incident. Management needs to reasonably make
certain that personnel conduct risk assessments to ensure
efficient and effective administration of the stockpiles and to
organize those program activities to identify and mitigate any
risks. That way, when needed, the stockpiles can be provided as
planned.
To implement this recommendation, OEP has contracted with
the Logistics Management Institute to evaluate the program, to
conduct a risk assessment, and to advise VA on areas for
improvement. We look forward to utilizing their expertise and
input and are moving ahead briskly to get this evaluation done.
Second, the GAO recommended that the agencies arrange for
periodic, independent inventories of the stockpiles. I'm happy
to report to you that VA has already conducted full inventories
of all of the stockpiles at every location. Complete stockpile
inventory will be done on a quarterly basis from this time
forward. And at completion of the December 2000 inventory, the
team will review the lessons learned and make any further
improvements that we feel are necessary in looking at the
processes in place during that year.
Third, GAO recommended that VA implement a tracking system
that retains complete documentation for all supplies which are
ordered, received or destroyed. While a tracking system was in
place at the time, obvious deficiencies were noted. We
recognized that improvement needed to be made and we arranged
for a more comprehensive and consistent tracking system to be
in place on a continuous real-time basis that will be
accessible to VA, OEP, and CDC staff.
Fourth, the GAO recommended that supplies be properly
rotated. It is important that the system be updated and provide
reports about future expiration dates, and that the ordering,
receiving, shipping and rotating of stock at each site be done
on a timely basis. We've put systems in place to ensure that
this will occur.
Mr. Chairman, I would like to close with a quick
description of some additional actions that have been taken
since the GAO review process took place, and that is that, as
you've heard, we have new memorandums of agreement with both
OEOP and with CDC which address all of these issues. We feel
that we have moved forward very rapidly to correct the problems
that were identified.
Second, VA employees who were responsible for managing this
program previously did this as an ancillary duty. Obviously,
while the resource need is not great, it is important to have
dedicated staff to maintain these stockpiles and to carry out
the periodic activities that are necessary to ensure that these
functions are being performed in a consistent and reproducible
way. Those full-time personnel have been put in place. There is
now a permanent full-time director of the emergency pharmacy
activities, and a total of six full-time staff will be assigned
to this activity.
Third, all the refrigeration issues have been dealt with.
Fourth, some communication issues were raised. The
communication between our partners and VA has been improved.
There have been numerous meetings and conference calls and we
intend to continue that schedule of routine meetings and
activities into the future.
Fifth, all the stockpiles have been replenished. And in
addition, during the week of December 27, 1999, full
inventories were conducted and the amount of diazepam on hand
at each stockpile was revalidated. We do feel that we need to
take issue with the statement that 1,000 doses of diazepam were
missing. In fact, they were not missing, they were replaced
with substitutes when the original auto-injectors were not
available for purchase. And I am pleased to report that we can
account for all of the Valium/Diazepam stores that were
necessary for that stockpile.
Mr. Chairman, I believe that the efforts of both the HHS
staff and the VA staff to develop, maintain, and deploy
emergency supplies, while they have had limitations in the
past, have been improved significantly over the last several
months. And we believe we now have systems in place that
address the GAO concerns and will ensure that these stockpiles
are available should they be necessary in the event of a
national emergency.
I'd be happy to answer questions for the committee.
Mr. Shays. Thank you very much. We appreciate it a lot.
[The prepared statement of Dr. Murphy follows:]
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Mr. Shays. Dr. Knouss.
Dr. Knouss. Thank you very much, Mr. Chairman. I want to
thank you again for the opportunity to appear before the
committee and for previous appearances where we've discussed
the whole of the National Disaster Medical System and our
approach as to trying to be prepared to assist the civilian
population should one of these awful events occur. But I would
like to put into context these teams and these stockpiles
because these are just a part of the total system of the
National Disaster Medical System in which we partner with the
Department of Veterans Affairs and the Department of Defense
and the Federal Emergency Management Agency.
I'd like to spend a few minutes this morning just
highlighting my testimony. I've provided my complete statement
for the record.
Today I'm here to discuss the recently released GAO report
of the complete audit of four of our specialized pharmaceutical
caches that are used by our special National Medical Response
Teams.
These stockpiles were designed to be deployed with these
four specialized teams in responding to a weapons of mass
destruction event and providing medical care to its victims. Of
course, we use our system for many other things. And in fact,
we're just now today completing some of our work with the Air
Alaska crash out in California in identifying the victims that
died in that accident. The stockpiles that we maintain for the
National Medical Response Teams contain specialized
pharmaceuticals to treat up to 5,000 victims of a chemical
exposure to nerve agents, among other medicines and medical
supplies.
The NMRT stockpiles are designed primarily to provide
additional supplies to local areas that have depleted their own
pharmaceutical resources in the initial hours after a chemical
attack, when time is of the essence. The NMRT stockpiles have
also been used to preposition supplies for designated special
events, including here in Washington, DC, for State of the
Union addresses and other activities.
The Department of Veterans Affairs is one of the four
partners in the National Disaster Medical System and manages
one of the largest pharmacy systems in the country.
Consequently, we approached VA with our proposal for the
purchase, management and deployment of these stockpiles. VA was
able to purchase the pharmaceuticals and supplies through their
purchasing system and store the stockpiles in locations from
which they can be deployed with our teams.
The report recently issued by GAO raises important concerns
about the manner in which these stockpiles were managed and the
oversight provided by our office. We've taken GAO's efforts and
report seriously, and we're taking immediate steps to ensure
proper internal controls are in place and that we are in
compliance with all regulations. I want to note that we have
carefully reviewed the results of GAO's audit and do not
believe that any of the issues cited degraded our ability to
respond to a chemical attack should it have occurred over the
last 2 years.
Based on the result of the GAO audit, however, we have
signed a new interagency agreement with the VA that spells out
each agency's responsibilities and activities, including
assurance of appropriate storage and physical security of the
stockpiles; strengthening of internal controls, including
audits by both our staff and VA staff, as well as independent
reviews; establishment of a schedule of regular communications,
inventory updates and reports; and regular and recurring
management oversight by our office.
We certainly understand GAO's concerns that insufficient
management and oversight controls do not provide any assurance
that, even if the audit had been 100 percent correct on 1 day,
there are no absolute assurances the same would be true the
next day, or at the time of deployment. However, we do not
agree with the implication that we would not have been able to
respond effectively to a WMD incident. A ``12 percent error
rate'' has to be put in the context of the type of items that
were included in the calculation, and how the error rate was
determined. An excess of large gloves is not a significant
problem and it is our understanding that an individual item
could have been produced up to three errors if it was over or
under the count, if the lot number was recorded incorrectly,
and if the expiration date was not the same as the inventory
listing.
But since being provided the audit results we have been
working with the VA to assure that these errors, regardless of
level of significance, are corrected. Our office and VA will
ensure implementation of a far more effective control
environment, including stricter inventory control and
monitoring and regular reporting and feedback; ensuring that
information is recorded properly and the inventory is kept up
to date; ensuring additional and regular onsite monitoring of
the stockpiles, including announces and no-notice inspections
of each stockpile; and ensuring that risk assessments and
control activities are implemented.
In conclusion, I want to reiterate that we are working very
diligently within our own office and with our VA partners to
correct the problems that GAO found, to do a 100 percent
inventory, to ensure that current stocks and recordkeeping are
accurate and up to date, and to develop and implement the
proper management controls and oversight to ensure that the
stockpiles are ready to deploy and that we are in compliance
with all laws and regulations.
Mr. Chairman, that concludes my testimony. I will be
pleased to answer any questions that you may have later on.
Mr. Shays. Thank you very much. We've heard from the VA and
from HHS and now we'll hear from CDC.
[The prepared statement of Dr. Knouss follows:]
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Mr. Shays. Dr. Ostroff.
Dr. Ostroff. Thank you, Mr. Chairman.
We appreciate the opportunity to discuss the development of
the National Pharmaceutical Stockpile or NPS, which is one of
the components of our overall public health response to the
threat of bioterrorism.
Today I am accompanied by Mr. Steven Bice, who is Chief of
our CDC National Pharmaceutical Stockpile Branch located in the
National Center for Environmental Health.
In 1998, CDC issued Preventing Emerging Infectious
Diseases: A Strategy for the 21st Century, our plan for
preventing emerging diseases. It focuses on four goals, each of
which has direct relevance to preparedness for bioterrorism:
disease surveillance and outbreak response; applied research;
infrastructure and training; and disease prevention and
control. This plan emphasized the need to be prepared for the
unexpected--whether it be a naturally occurring West Nile Virus
outbreak or the deliberate release of anthrax by a terrorist.
A 5-year strategic plan for bioterrorism that CDC has been
developing with its partners will soon be published. It defines
activities necessary to ensure that the public health community
is prepared to recognize and respond to a threat or actual act
of bioterrorism.
However, CDC has already moved forward in multiple critical
areas using funds appropriated by Congress beginning in fiscal
year 1999. One of these areas was the development of a National
Pharmaceutical Stockpile which can be called upon in response
to an episode caused by a biological or chemical agent. The
mission of CDC's NPS is to ensure the availability of life-
saving pharmaceuticals and other medical supplies for prompt
delivery to the site of a biological or chemical terrorist
event anywhere in the United States. While the first response
to an incident will come from local and State emergency medical
and public health personnel, few local governments have the
resources to create sufficient stockpiles on their own.
CDC has used an ongoing deliberative process to guide
purchasing decisions for the NPS. Fiscal year 1999 decisions
were based on the recommendations of two multispeciality expert
working groups and the Department's operating plan, which was
submitted to Congress.
A subcommittee of the Advisory Committee to the Director of
CDC also is involved in this review process. Because
acquisition priorities may change over time as threats change,
these committees will continue to provide input and oversight.
CDC has also established relationships with the national
security agencies to ensure that the stockpile reflects current
concerns and information.
The expert working groups convened by CDC prioritized the
following six biological agents and diseases as concerns in
civilian settings: smallpox, anthrax, pneumonic plague,
tularemia, botulinum toxin and viral hemorrhagic fevers.
Because anthrax, plague and tularemia can be treated with
currently available antibiotics, purchasing these products for
the NPS formulary was given top priority for fiscal year 1999.
Presently there is no additional smallpox vaccine or botulism
antitoxin to procure. However, efforts to rectify this
situation are a high priority for the Department and our
partners in the Department of Defense.
The working groups also identified chemical agents that
could be used in a terrorist incident, including nerve agents
such as sarin, and respiratory irritants and vesicants such as
sulfur mustard and cyanide. Obtaining antidotes for these
agents was also given high priority in fiscal year 1999.
The NPS has two basic components. One consists of four pre-
assembled sets of supplies which are called ``12-hour push
packages,'' ready for quick delivery and use in the field. And
in response to your questions to the previous panel, we've
brought pictures so that you can see what one of these actually
looks like in the warehouse. There are also Vendor Managed
Inventory packages [VMI], which will be activated if the
incident requires a continued response. The VMI packages will
be shipped to arrive at 24 and 36 hours after activation and
will comprise material that would be delivered from one or more
pharmaceutical manufacturers or prime vendors with whom we will
contract to hold inventory that can be released at the time of
an emergency.
The decision to deploy the stockpile will be based on the
best epidemiologic, laboratory and public health information
regarding the nature of the threat. This is one of the reasons
the development of the public infrastructure for bioterrorism
response is so important. When a biological or chemical
terrorist incident is suspected, CDC will enhance surveillance
activities, laboratory confirmation procedures, notification of
the Office of Emergency Preparedness and appropriate Federal
agencies and provide pertinent technical support. With regard
to the stockpile, the Director of CDC, in consultation with the
Assistant Secretary for Health, will direct its mobilization.
If CDC stockpile components are needed, 12-hour push packages
will be rapidly deployed. CDC will then begin the process of
tailoring subsequent deliveries of stockpile components from
the Vendor Managed Inventory as indicated by the specific
biological or chemical threat.
In regard to the GAO-identified weaknesses in internal
controls and management structure, there are three aspects of
our NPS which are critical in addressing these concerns. First,
there is direct coordination and management by CDC staff. CDC
is an active partner in all aspects of the NPS. This includes
providing guidance, oversight, operational control, and
evaluation. After an intensive systematic deliberative process,
which included valuable input and support from GAO and others,
CDC chose the VA as the acquisition partner to work with on the
NPS and feels that carefully planned management steps and close
oversight will prevent future problems such as those identified
by GAO.
The second point is that there will be continuous
monitoring, quality assurance, and evaluation. We've taken
steps to assure that the memorandum of agreement between CDC
and the VA is explicit, comprehensive and precise. And CDC's
tradition of oversight, technical assistance, and onsite
presence is an integral part of the NPS. Through its real-time
access to the VA's electronic inventory record system, CDC will
monitor the purchase of stockpile pharmaceuticals and medical
equipment, rotation of stock, and disposal of items for which
there is not comparable civilian use.
CDC will physically verify the records of stock maintenance
and transactions as part of its periodic unannounced site
visits. Since the memorandum of agreement was signed CDC has
already made multiple visits to inspect the 12-hour push
packages, including two visits which were unannounced. Security
measures will also be in place to safeguard NPS pharmaceutical
supplies and equipment.
The third aspect of our management plan is partnerships,
collaboration and communication. The responsibility for
managing the NPS requires that we partner with OEP, other
Federal agencies and State and local governments. CDC is
planning training to fully prepare our State and local partners
and will provide technical assistance to State and local
governments that wish to purchase pharmaceuticals, chemical
antidotes, other medical supplies and medical equipment to
augment their current emergency response capabilities.
In summary, we believe that these components of the NPS
will address the management concerns identified by GAO and
assure provision of medical supplies, pharmaceuticals and other
stockpiled equipment in a timely fashion.
This concludes my comments and we, too, will be happy to
answer any questions.
Mr. Shays. Thank you. This is very interesting and it will
be interesting for me to see how all of you interface with each
other.
[The prepared statement of Dr. Ostroff follows:]
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Mr. Shays. Colonel, it is so wonderful to have you here and
you have the floor.
Colonel Hollifield. Thank you, sir. I'm very pleased to be
here. I have the opportunity today to address the management of
medical supplies within the Chemical/Biological Incident
Response Force. With me today is Commander Warren R. Dalton.
Commander Dalton is a U.S. Navy Medical Officer and board-
certified emergency medical physician and serves as my Senior
Medical Officer.
Commander Dalton dealt directly with the GAO
representatives who visited our command and is here to provide
any additional insight you may desire relative to that visit or
the management of our medical supplies.
As you're aware, sir, during the summer of 1999 the GAO
undertook a study to evaluate the readiness of our Nation's
``stockpile'' of chemical and biological medicines designed to
treat civilian casualties. As originally envisioned no
Department of Defense Activities were projected to be a part of
that study. However, the GAO did visit our command at CBIRF,
Camp Lejeune, and had some valuable insight for us.
Although CBIRF maintains medical supplies as part of
routine inventory, we've never considered those supplies to
fall into the category of being a ``stockpile,'' basically
because we don't view those supplies as being held for further
distribution. We view that our medical supplies are held for
internal use, primarily for the treatment of the Marines and
sailors assigned to the command; that is to say, sir, that the
medical supplies that are stocked are not stocked for
distribution to civilian care providers or for routinely
treating civilian casualties, except where emergency lifesaving
care is required.
Accordingly, we view the supplies that we hold as being
held by the end user as opposed to distributor. Nonetheless,
where the GAO recommended we strengthen our internal control
measures, we think that we've taken appropriate action to
comply with the guidelines set forth in OMB Circular A-123.
First they asked that we conduct risk assessments and look
at our program activities and organize those to identify and
mitigate those risks.
I conducted a risk assessment in December 1999, and as part
of this risk assessment I asked for a formal independent
external physical security evaluation. We just received the
results of that evaluation late in February of this past year
and we're taking appropriate action to implement the measures
contained therein.
Specifically, we'll be looking at improving our access
control under that portion of the warehouse where medical
supplies are stored, setting up positive lock and key control
procedures.
In addition, we will be providing crime prevention and loss
awareness training for all personnel performing supply related
duties.
Additionally, as part of this risk assessment I asked my
Supply Officer to conduct a total review of the medical supply
operating procedures in effect at my command. His charter was
to ensure that the procedures that we have in place are
consistent with governing Marine Corps directives and the
policy as set forth in the Marine Corps Consumer Level Supply
Policy Manual, Marine Corps Order P4400.150E. Since the
Department of Defense is not formally a participant in the
National Pharmaceutical Stockpile Program, it is this directive
that we use to manage our medical supply operations.
Second, the GAO recommended that CBIRF arrange for periodic
independent evaluations. The Marine Corps Field Supply
Maintenance Analysis Office, an independent agency that
operates outside of my influence and outside of my command,
routinely conducts external reviews of all Marine Corps supply
related accounts.
Following the GAO's visit I coordinated and arranged with
my higher headquarters for an independent evaluation by an
external agency having specific knowledge of Navy medical
logistic procedures. The Medical Logistics Company of the
Second Force Service Support Group was tasked to conduct a
review of our operating procedures, and that review was just
completed approximately 1 week ago.
Pending the written results of that review, when received,
we will take appropriate action to implement any findings and
recommendations that they make.
Further, I directed that my Supply Officer conduct periodic
spot checks of our inventory and have arranged for a quarterly
reconciliation of the medical supply account. I've asked him to
ensure that the medical supply account receive special emphasis
during all future supply related inspections and audits.
Third, the GAO recommended that we implement a tracking
system that retains complete documentation for all supplies
that were either ordered, received, or destroyed.
We have recently evaluated our existing data base and to be
quite honest, sir, there's room for improvement. And we're
working to modify that data base to improve the fields of data
this captures so that we will have better tracking and
visibility.
Additionally, in light of the fact that our medical supply
account is maintained on a daily basis by Navy medical
personnel as opposed to supply personnel, my Supply Officer has
been directed to ensure that the medical personnel tasked with
the daily operation receive adequate training in supply related
functions.
Finally, the GAO recommended that we rotate supplies
properly. It is my intent to publish specific written policy
that addresses the overall management of our supply medical
account when we receive the results of the Medical Logistics
Company's independent evaluation. This policy will address not
only the proper rotation of medical supplies, but will further
ensure that we are being consistent with the existing Marine
Corps and Department of Navy regulations.
I believe that all these actions will significantly improve
the internal control over my medical supply account.
Before I conclude, sir, I would like to address a few
additional issues raised in the GAO Report.
The GAO noted that CBIRF did not have an authorized
allowance list of supplies that it was authorized to maintain.
Mr. Shays. If you talk a little slower--I think you're well
trained to get it all done, but I'm going to try to listen
carefully here.
Colonel Hollifield. Yes, sir.
The medical supplies that I maintain, sir, are those that
my staff and I feel were necessary to be able to execute our
mission. The supplies were quite typical in terms of types and
quantities to the types of medical items that would be held by
most any military medical organization.
Within the Department of the Navy the types and quantities
of supplies and equipment that a unit is authorized to hold is
set forth in a standardized, authorized medical allowance list,
commonly referred to as an AMAL. An AMAL exists for every type
of military organization, however, none have yet been developed
for chemical or biological response units such as CBIRF. To
this end we have taken the lead in trying to identify what we
feel is an appropriate stockage level of medical equipment and
supplies that we should retain to be mission-capable. This has
been submitted to our Marine Corps Systems Command at Quantico,
VA, which is currently working to standardize an allowance
list.
In the interim it is my intent to publish a standardized
allowance list as a CO's allowance list until such time as an
AMAL is fielded. This allowance list will serve as the baseline
for our inventory.
In addition to those general medical care items that we
hold, sir, my unit stocks three medications specifically
designed for the treatment of chemical or biological
casualties. These medications, 2 Pam Chloride, atropine, and
diazepam, are held first and foremost as part of my own force
protection program. Since CBIRF Marines and sailors risk
potential exposure when sent to respond to a chemical or
biological incident, this is a measure that any prudent
commander would take. However, I also recognize that during any
response there is a potential that we may have to provide care
for either local first responders or civilian casualties. And
while the medications are not stocked or held expressly for
this purpose, they could be so used in emergency situations.
However, in such circumstances it has never been envisioned
these supplies would be turned over to local medical care
providers, but rather that they would be administered by my
medical personnel only when lives were genuinely at risk and
where no reasonable alternative exists.
Sir, I'm here today not to offer any excuses, but to
provide an explanation of the actions that we've taken since
GAO visited. GAO provided a very important aspect for us
because they brought a viewpoint that was beyond the pure
military bounds and they've caused us to take an internal look
at our operations and look for methods and means within our
resources and capabilities to improve our process.
We do feel, however, that in the characterization of
CBIRF's medical supply as a kind of ``stockpile,'' the GAO does
not truely provide an accurate depiction of the holdings that
we possess. We're keenly aware that we are a unique unit with a
very important mission, and accordingly my staff and I have
made every effort to implement the recommendations within our
power and capabilities.
Mr. Chairman, we stand ready to answer any questions that
you may have today, just as your Marines and sailors within the
unit stand ready to respond when this Nation calls. Thank you.
Mr. Shays. Thank you, Colonel.
[The prepared statement of Colonel Hollifield follows:]
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Mr. Shays. This is very helpful to have all of you here and
it will be interesting for me, one, to see how you interface
and, two, to understand a few things that this raises really
beyond the GAO report that will help us in our continual
oversight. And I'll say from the outset that our view is that
sometimes GAO is always easy to come in and find things wrong
and it's always easy for Congress to come in condemn and say
why is it wrong. But if you see what GAO has suggested as
making sense, and agree with the criticisms, see that their
recommendations make sense and that people are implementing
those recommendations, we're happy to get on to the next issue
and not throw stones.
But there are some things I just don't quite understand, so
there are going to be some general questions at first.
First, Colonel, I understand the Marines are usually the
first in, they always want to be the first in, but the Army
feels sometimes they're going to be the first in in some
instances. But bottom line, you're usually first in and so I'm
making an assumption that that's why you have a stockpile. But
I don't understand, one, if you're the only branch that has the
stockpile--if you have any knowledge of this I'd like you to
share it with me, but I can ask others--one, why do you have
this stockpile? And two, if you're the only branch to have it,
why you and not the other branches?
Colonel Hollifield. Mr. Chairman, I would default back to
saying that we've never considered what we hold as stockpile.
If you look at the quantities of items that we hold and the
types of items that we have in our inventory, they're very
typical to what you would find in almost any operational
military command. So accordingly, if the quantities and items
that we hold are truly a stockpile, in essence almost every
military organization holds a stockpile.
We are not a part of the formal cache program that you were
briefed on earlier. However, we do stock a small quantity of
38,000 medical items and hold approximately 7,000 items that
would be specifically designed for first response to a chemical
or biological event. The remainder of the items that we stock
are primarily general medical care items. So we don't view this
as a stockpile. We really view it at a response stock.
Primarily we hold these supplies for our own individual use.
We've never envisioned that we would distribute those to anyone
outside of our organization or outside military control.
Mr. Shays. So it basically is your testimony that you
suspect the other branches are doing the same thing you're
doing?
Colonel Hollifield. Sir, I couldn't speculate on whether
they're doing that. I know that we have been a test bed, in
essence, to develop techniques and procedures and I'm sure they
face the same challenge as we have in terms of an authorized
list of what they should have.
Mr. Shays. Is this a directive from the Secretary of
Defense that you do this? In other words, if I'm asking a
question you may not know, I understand, because it's not
really the primary focus of this hearing, it's just a logical
question to ask for our understanding this whole process.
Colonel Hollifield. There is no basis, sir, that tells me
what I'm authorized to hold. The items that we hold now are
those that we held when the unit was first activated in 1996.
Since that time we've developed to come up with an
understanding of what we feel is appropriate to have in order
to be able to effectively execute a response.
Mr. Shays. I'll come back to this.
My understanding--I'll ask anyone here to correct me--we in
Congress asked that the VA stockpile, HHS and VA--well,
actually, maybe HHS and then they contracted with VA, so I'll
have that clarified--but we had four sites. But we also said
that CDC would have a stockpile as well. I get the sense that
it really--I mean, the way I was beginning to see it, I was
beginning to think the Marines would be first, maybe, they
might be the first to a particular site, but this is probably
just military.
Colonel Hollifield. The event that would get us to the site
would be a request from another Federal agency, such as FEMA.
Mr. Shays. My sense, though, is that the primary sites are
the four for the earliest, that those are primary sites for the
fastest call, and then my sense is the CDC sites will be larger
and then will respond on a more long-term basis. Dr. Ostroff,
am I right? Kind of give me a picture here. Give me the
sequence of how this works.
Dr. Ostroff. Right. I think I'll let Dr. Knouss also
respond.
I think one of the things that is important to point out is
that there are different types of events which are possible.
And we look at chemical events as being quite different from
biological events. When chemical events occur, the timeframe
between when the release occurs and when people start getting
sick is really quite brief, whereas with most of the biological
agents the time interval between the exposure and when people
will become ill for some of these agents can be days to weeks.
And so the events will play themselves out quite differently.
And how these events get recognized will clearly be quite
different as well.
The stockpiles developed by OEP--and I think I'll leave
that to Dr. Knouss to further elaborate--are largely around the
deployment of teams that will be responding to chemical events.
We have developed our stockpile to be able to supplement in
larger numbers those materials if the chemical event is larger
that can be handled with the stockpiles developed by OEP. But
ours is principally developed around being able to respond to
biological events.
Dr. Knouss. Support function No. 8 of the Federal Response
Plan under FEMA deals with the consequence management
responsible agency if there should be one of these events in
the United States. Our part of that is that the health and
medical response and the four national response teams that we
have put together are meant to be able to deploy to an incident
site or to be prepositioned out at the site in which there is a
threat, a known threat, a significant threat, in order to deal
with the most immediate consequences. So most of the cache that
we carry with us is meant to deal with the immediate
consequences of a chemical exposure, where time is absolutely
of the essence to get to the scene and to be able to offer
antidotes. And frankly, by the time we reach the scene a lot of
our supplies are meant to be resupply of what we are trying to
already preposition through metropolitan medical response
systems in the major metropolitan areas themselves.
And then we would come in with our stockpiles and our
caches.
Mr. Shays. Those being----
Dr. Knouss. OEP, HHS.
Mr. Shays. The four VA stockpiles?
Dr. Knouss. Yes. They would accompany our teams in and we
have designed those caches so that they can be split into five
pieces, readily. One piece could go to an incident and four
other pieces could go to resupply up to four hospital
facilities. And once we arrive at a scene we could immediately
separate those caches into those five pieces, or we could
manage it a little bit differently. We could send two to one
place or three pieces to another, but they are manageable
pieces of an overall cache and designed to be tactically
responsive to whatever the situation might be.
If we need more to treat 5,000 people we can bring in a
second cache from another location to reinforce that. But
frankly, at some point the limiting factor becomes the number
of professionals that are available to be able to administer
the caches in a pharmaceutical--on a rapid basis.
Mr. Shays. So technically you think you have basically the
ability to respond to 20,000?
Dr. Knouss. Exactly. At the maximum. Now, that response
needs to occur in hours, so time is really of the essence. The
CDC stockpile is meant to deal with reinforcing some of that
chemical supply if we need to for very serious exposures. But
is primarily geared to meeting the very large pharmaceutical
requirements where up to millions of people might be exposed to
a biological attack. And so therefore the cache that you see
there illustrated as part of CDC's cache is far larger than the
size of the cache that you will see--the number of boxes that
you would see at one of our warehouses.
Mr. Shays. Dr. Ostroff, how many sites are you going to be
developing?
Dr. Ostroff. The actual number of sites is still under
discussion. There will be four sites for the 12-hour push
packages.
Mr. Shays. Four different sites than with the VA?
Dr. Ostroff. No, one of the sites is the VA warehouse in
Hines, IL. The other three have yet to be prepositioned. There
are still discussions about how to most efficiently locate
them.
Mr. Shays. So the one in Hines has basically yours and
HHS's. I just want to make sure I'm not--I want to be clear
here. We have four VA sites. CDC has mandated to establish a
bigger cache.
Dr. Ostroff. Right.
Mr. Shays. Are you also using some of the VA sites as well
as other sites?
Dr. Ostroff. Well, it's conceivable. For instance, the
Vendor Managed Inventory, which is the longer-term supply, will
be a virtual inventory through either the manufacturers
themselves or through what's referred to as Prime Vendor,
essentially a middleman who would be able to provide a variety
of different agents. And that inventory may be in a number of
different locations. We are seeking to try to minimize the
number of different locations.
Mr. Shays. I'm going to go to Mr. Tierney. But just let me
ask this question then I'll be coming back. Is it conceivable
that we would just pay manufacturers to have an excess supply?
I would think one of the advantages is that then they could
then keep rotating it out so it never becomes useless, and they
can still get into the marketplace potentially.
Mr. Ostroff. That's correct. You're absolutely correct and
that is far and away the most efficient way to have the vendor
managed----
Mr. Shays. And I'm going to come back and ask the VA and
HHS if you let--the shelf life runs out, but do you try to,
maybe if you have weeks or a month left or something, try to
get them out so they can be used somewhere where there's a
need. I know for instance that Ameri-Cares, based in my
community of Canaan, has given out billions of dollars worth of
drugs around the world. And what they do is, they get close to
terminated vaccines and so on and then use them up within the
time period. So I'll ask VA if they just throw away these
pharmaceuticals or whether we're still able to utilize them.
Mr. Tierney said I could just jump in and ask you that. Is
this a little beyond the point now? I'm not trying to rush you
because I first want to make sure you manage the
pharmaceuticals well, but this is when we get beyond the good
management, and I'm just hoping that we're not wasting the
products.
Dr. Ogden. It's possible to return some of the items. Some
of the items we can't return because that's part of the
agreement between, let's say, the manufacturer and the
Department of Defense for those items that we specifically buy
for the Department of Defense, but some items we can return and
we have returned and do have credits received for those
outdated products.
Mr. Shays. We can get into this later. Thank you.
Mr. Tierney. Thank you, Mr. Chairman. I really don't have a
lot of questions in here. I think that you've all addressed the
GAO's report in a fine manner.
I do have one question for the Colonel, to try to get an
understanding. Do you have any knowledge about whether or not
the other branches have units similar to yours?
Colonel Hollifield. Mr. Tierney, I don't have any knowledge
of a unit exactly like mine. I know that they are developing
the Weapons of Mass Destruction Civil Support Teams within the
Army National Guard. The parameters of that program I'm not
familiar with in specific detail.
Mr. Tierney. Thank you. Other than that I think I
understand pretty much what's going on and what's transpired
here. I do want to make the comment without at all seeming
patronizing or anything that I think it was refreshing to hear
people acknowledge the GAO's value in the report that they did
and address it. And I think everybody reserved whatever
questions and issues they wanted to raise on that, but I think
it's a very high level of professionalism and response and I
just want to commend you all for doing that and it's impressive
to us and I think it's going to benefit the country. And thank
you very much.
Mr. Shays. I have just one question. I wanted to read the
testimony that I had on the Marines.
Colonel, I want you to put this in some perspective because
on the surface it doesn't make me feel comfortable. I think
there is an answer for it so you say, ``While I do not think
that CBIRF should be held to a higher supply management
standard then those required of any other military unit, I
recognize that the unique nature of our unit and mission make
consideration of GAO's observations prudent.''
I've always thought that the military actually has a higher
standard then the private sector and the implication there is
not comforting.
Colonel Hollifield. Sir, we have a set procedure for the
management of our supply account as set forth in our Marine
Corps Consumer Level Supply Policy Manual. As it was pointed
out when the GAO visited, some of the systems that we use, our
data bases for example, do not capture all of the exact data
fields that would be necessary to adequately ensure that we're
tracking and properly getting the visibility to the degree that
was lacking when GAO visited. Those data bases that we use are
data base systems that are prescribed for us. Certainly,
however, there's nothing preventing us from looking at or
modifying those and adding additional fields so that we do
capture stuff such as consumption data, rotation dates of
supplies, shelf life expiration, et cetera. Those right now are
not captured with the existing data base system.
Mr. Shays. Those are not what? I'm sorry.
Colonel Hollifield. Those are not captured at this time by
the existing data base. So in addition the data base captures
only the very basic information in terms of the type of item,
its stock number, et cetera. But we have to go in and manually
track shelf life expiration. So when we say that we don't feel
that we should be held to a higher supply management standard,
my intent there is to say, we think we have pretty good
guidelines already in existence with our existing policy. But
we do need to go back and make some minor modifications to
enhance our control mechanisms.
Mr. Shays. I'm trying to understand why when GAO looked at
your facility, they were basically directed by DOD Health
Affairs to look at your facility as a stockpile facility, and
so it's--we're going to try to understand the Marines, not
Army, why Marines. In one sense maybe it's a compliment to you
all that you all may be doing something a little different than
the other branches. But let me just state what I think I'm
hearing and then I want to be corrected because we're almost
done here.
The bottom line, the first responders are going to actually
be the local communities themselves, that's going to happen.
They're going to have some supplies. And the next response is
going to be--and I'm not sure how the logistics work--but we're
going to get supplies from one or more of our four locations.
Is that going to be done by the military, is it going to be
done commercially, is it going to be done in a combination? And
is HHS basically, is the VA just responsible for the stockpile
once, but that's it and then HHS takes over? I've asked a few
questions.
Dr. Knouss. To get back to our system, the National
Disaster Medical System is made up of four components. We have
HHS's components which are mainly the teams that are going out
and providing care at the scene of a disaster. Our partners in
the Department of Veterans Affairs also assist us with that,
but also are responsible for operating a part of the system
that would be used to hospitalize people that need care in
which the local communities resources have been overwhelmed and
DOD----
Mr. Shays. DOD using the VA facilities locally?
Dr. Knouss. Well, no, actually it's a system of 100,000
hospital beds in civilian hospitals that we have organized
under Federal Coordinating Centers operated by the VA and by
the three branches of DOD. And that's a partnership arrangement
where we have mainly to deal with two problems, military
contingencies----
Mr. Shays. The ``we''--sometimes I hear ``we'', and your
``we'' might be different then my ``we.''
Dr. Knouss. All right. ``We'' as the Federal Government. We
and HHS.
Mr. Shays. Who is the ``we'' that makes sure this happens,
is it HHS?
Dr. Knouss. The partnership is the Department of Health and
Human Services; the Assistant Secretary for Health chairs the
group that manages this system. The Under Secretary for Health
of the Department of Veterans Affairs, the Assistant Secretary
of Defense for Health Affairs at DOD and the Director of FEMA.
That partnership operates the system. DOD is responsible for
transportation of patients in that system. And the Department
of Veterans Affairs and DOD are responsible for the maintenance
of the hospital beds in that civilian contingency bed system,
with 2,000 hospitals around the country participating.
Mr. Shays. How do the pharmaceuticals get to the sites?
Dr. Knouss. The way we would do that is under the Federal
Response Plan. The first step is for FEMA as responsible for
transportation to move our team to the disaster site and they
would depend on DOD resources. If we're not able to use that
system, our backup is a direct call to the Director of Military
Support in the Pentagon. And our third backup is to piggyback
onto the civilian contracts that CDC will have for the larger
stockpile movement.
So we have three steps that we can use to back up movement
of our teams and smaller supplies.
Mr. Shays. I've learned just in my own small office if I
have two people responsible, nobody is responsible.
Dr. Knouss. We are.
Mr. Shays. So, I always have one person ultimately
responsible.
Dr. Knouss. Our office.
Dr. Murphy. Chairman Shays, we would get a call from OEP
that a disaster has been declared. They need the cache. That
call would go out; VA would go to the cache, transport it and
deliver it to the team, the NMRT, and they would take it to the
disaster site. That's how the pharmaceuticals would be
transported and that would be VA's part of the role.
Mr. Shays. I think I'm pretty clear about that. I'm pretty
clear that the VA is basically taking the recommendations of
the GAO and implementing them. You have an objection to one
area dealing with what you had in supply and not. So you take
issue with one area of their report, correct?
It's my understanding that basically you, Dr. Ostroff, are
still deciding how much is going to be held by the
manufacturer, what sites to have and so on. But I'm sure the
GAO report is helpful for you to just make sure.
And Colonel, the sense I'm getting from you is that you
view your stockpile differently. I just want to be certain so
we don't have to deal with it later. Is it possible that DOD
views your stockpile as unique and that you aren't to service
the needs the other three branches?
Colonel Hollifield. Sir, I have no knowledge if that's the
view that they hold.
Mr. Shays. Well, then I don't want to imply that it is. I
just want to make sure I asked the question.
Colonel Hollifield. I know that in your previous analogy,
sir, the two steps, we count that in between the incident and
when the 12-hour push is going to show up, we're there not
primarily for that purpose, but we certainly have some
medications with us, that in the event that there is a time gap
to be bridged between the time that the first responders act
and may not have those medical supplies they need, and OEP and
CDC can push from their stockpiles, we can bridge that gap on a
very moderate basis.
Mr. Shays. Let me say this is the first hearing that's been
helpful for us to get this knowledge and it's also to make you
aware that we are interested and will be watching, in part
because I think there's a temptation to think you may never be
utilized, and yet you may. But we're also going to just make
sure that you're living up to all your goals and objectives.
And then we're also going to be looking to see if the system
can be improved and if we in Congress can play a part.
Is there any comment that any of you want to make before we
adjourn this hearing?
Mr. Ogden, you look like you want to say something.
Mr. Ogden. No, thanks. Thank you very much, Mr. Chairman.
Just thank you.
Mr. Shays. Well it's wonderful to have you here. Thank you
for your good work.
The hearing is adjourned.
[Whereupon, at 11:35 a.m., the subcommittee was adjourned,
to reconvene at the call of the Chair.]