The $10.8 Million Bonus Round: Skill Incentives for the Executives Themselves

Critical skill incentives were a PACT Act tool to recruit scarce clinical skills. VA instead paid $10.8 million of them to 182 of its own central-office senior executives — nearly $39,000 to over $100,000 each — with inadequate justification, the OIG found.

Critical skill incentives (CSIs) are a PACT Act recruitment and retention tool meant for employees who possess a high-demand or shortage skill. VA instead awarded $10.8 million in CSIs to 182 senior executives in the Veterans Health Administration and Veterans Benefits Administration at VA's central office, ranging from nearly $39,000 to over $100,000 each.

The OIG found the awards to nearly all VHA and VBA central-office executives lacked adequate justification and were inconsistent with the PACT Act and VA policy. It cited insufficient transparency from VHA, excessive deference by HR&A leaders to senior leaders despite staff concerns, missed legal issues by the Office of General Counsel, and failure to use VA's governance processes.

VA announced the error in September 2023, cancelled the payments, notified Congress, and requested the OIG review. VA concurred with both OIG findings and all eight recommendations and provided acceptable action plans; the OIG is monitoring implementation. This was an administrative investigation — a mismanagement finding, not a criminal case against the executives.

"are meant for an employee who 'possesses a high-demand skill or skill that is at a shortage'"
— VA Office of Inspector General, on what critical skill incentives are for

Source: VA Office of Inspector General — VA Improperly Awarded $10.8 Million in Incentives to Central Office Senior Executives. Part of the VA Fraud library — see also the case files for the prosecutions these systems produced.