Judge Upholds Firing of VA Exec – But Not Because of Wait Time Scandal

A federal administrative judge has upheld the Veterans Affairs Department’s decision to fire the career senior executive who ran its Phoenix health care system when the scandal over falsifying wait lists erupted last spring. But the judge based his decision to support Sharon Helman’s termination largely because she improperly accepted more than $13,000 in gifts from a lobbyist and failed to report them, not because she engaged in misconduct related to manipulating data to conceal excessive wait times for vets seeking health care.

Chief Administrative Judge Stephen C. Mish rejected the agency’s claim that Helman’s lack of oversight contributed to falsifying waiting lists of vets trying to schedule medical appointments—arguably the most important charge in the department’s case against Helman and the one the media and Congress have focused on. The agency also failed to prove that Helman ignored the situation when she became aware of it, or that she failed to notify senior leadership about it. VA couldn’t prove that Helman had retaliated against whistleblowers within the department either, according to Mish.

“The press and congressional attention has been on the charges the agency failed to prove,” the decision stated. The VA inspector general has issued 18 reports since 2005 on the problems with scheduling medical appointments for vets and excessive wait times, both locally and nationally. But it wasn’t until spring 2014 – after the deaths of vets who had been on waiting lists -- that the issue gained national attention. Helman did not become director of the Phoenix VA health care system until Feb. 26, 2012.

The law firm that represented Helman in her appeal to the Merit Systems Protection Board viewed the ruling as a vindication for their client, citing her firing as a political act that destroyed “a previously unblemished career and reputation.” By getting rid of Helman, “the VA hoped the American public would accept its preferred storyline (that blames the career workforce out in the field for hiding veterans’ access problems) and stop asking questions,” said the statement from Shaw, Bransford & Roth P.C. “But the MSPB’s decision sets the story straight. Sharon Helman did not kill veterans. Sharon Helman did not manipulate wait time data. The VA’s preferred storyline has been proven a fabrication, of which the VA was aware the entire time.”

Mish did affirm VA’s claim that Helman took action in 2013 that “could be perceived as retaliatory” when she placed Dr. Katherine Mitchell, former director of the Phoenix VA healthcare system’s emergency department on administrative leave for disclosing information about vets who had killed themselves to Sen. John McCain, R-Ariz. But the most damning charge against Helman, which seemingly has nothing to do with the controversy over vets’ access to care or fraudulent waiting lists, involved that age-old conflict of interest in politics and government: the ethics of accepting gifts.

Mish found that Helman accepted thousands of dollars in gifts and travel expenses, including round-trip plane tickets, a trip to Disneyland for her and her family, and tickets to a Beyonce concert, from Dennis “Max” Lewis, vice president of Jefferson Consulting Group, a Washington lobby shop. Jefferson does not directly do business with the VA, but its clients do.

“I find it difficult to believe that she accepted over $13,000 in gifts from Lewis over a two-year period, as described above, without knowing what he did for a living,” Mish concluded. “I also find this acceptance of gifts from him created the appearance of a conflict of interest.”

The judge also upheld the department’s charge that Helman did not properly report the gifts to the government. “In the context of the appellant’s position, as an SES director of a sizable health care system with a large budget, one must be scrupulous to avoid even the appearance of a conflict of interest and to correctly report the things of monetary value one receives from others,” Mish wrote in his decision. “The higher ranking one is, the more important those things become.”

In addition, Mish was not persuaded that Helman’s firing was influenced by political or media pressure, or that it violated her due process rights. “Specifically, I find that the appellant was aware for over five months, since the May 30, 2014 notice of proposed removal, that the agency was pursuing disciplinary action against her, and of the general bases for at least some of the misconduct alleged in the November 10, 2014, notice of pending action. Thus, this is not a case where an employee was caught off guard.”

Where Helman goes from here is unclear. Under the 2014 Veterans Access, Choice and Accountability Act, the VA can fire and demote Senior Executive Service employees immediately, with paychecks getting cut off the day of the termination. The affected executive would then have seven days to issue an appeal to the Merit Systems Protection Board, which in turn would have 21 days for an expedited adjudication. MSPB’s ruling is final under the new law, but Helman could pursue her case in district court, challenging the constitutionality of the VA Accountability Act. But that’s a long shot, according to Cheri Cannon, a partner at Tully Rinckey, a federal sector labor and employment law firm in Washington.

“I don’t know she is the right poster child for unfair congressional action,” Cannon said, referring to what some perceive as the law’s violation of due process on account of the changes to employee notification and appeals. “The actual taking of those gifts is a real problem.” Cannon says the Justice Department could decide to go after her for that.

Cannon says the case has much larger implications beyond Helman, and that it’s just “a matter of time” before someone challenges the constitutionality of the new law and the expedited process for firing career senior executives at VA and adjudicating those personnel actions. She said the VA did not build a strong case against Helman. “They won, but they didn’t really win. They won on a fluke charge that wasn’t probably in their mind when she [Helman] went on administrative leave.”

Cannon says the charges against Helman that the judge sustained are serious, particularly the ones related to taking gifts, but it’s unclear how those violations even came to light. Did the agency come across them as a matter of course during their investigation into the wait time fraud and mismanagement, or did officials go looking for something to help bring Helman down?

“I don’t know the answer,” said Cannon, but “the real stuff they needed to stick didn’t stick.”