President Bush late last month nominated retired Lt. Gen. James Peake to be the next secretary of the Department of Veterans Affairs. It is not an inconsequential wartime post: The department is the second-largest government agency after the Defense Department. And the VA faces the awesome responsibility of caring for several generations of veterans, including the crush of American service members back from Iraq and Afghanistan.
On paper, Peake seems qualified. Wounded twice in Vietnam, he retired in 2004 from his post as Army surgeon general, the Army’s top medical officer, with 40 years of experience in the field of military medicine.
But Bush plucked Peake directly from a private company that has raked in hundreds of millions of dollars from contracts with the VA — and Peake himself helped develop proposals for the company to contract with the VA. That has raised questions about conflict of interest, potentially pitting veterans’ care against corporate profits. Moreover, if he is confirmed, Peake will be the second head of the VA under the Bush administration to come from that same private contractor, QTC Management Inc.
When a veteran first applies for that compensation, a doctor conducts a physical to help determine how much money he or she deserves. Historically, VA doctors do most of those examinations. But increasingly they are being performed by QTC Management, the for-profit contractor that employed Peake as its chief operating officer from 2006 until now.
The company has a virtual lock on the expanding business of performing the physicals on veterans, which help determine how much they should get in disability checks from the VA. The company first started conducting the examinations in the late 1990s, part of a smaller effort to help the department alleviate a backlog of veterans awaiting benefits. This year the VA will farm out 100,000 to 150,000 of these examinations to QTC Management, according to the company’s chairman. A 2005 report from the VA’s inspector general says the company charges around $590 for each exam, making the contracts worth at least $88 million this year alone.
The first VA chief selected by Bush to come directly from QTC Management was Anthony Principi, then president of the company, who served as VA secretary from 2001 until 2005. During those years, the company reportedly hauled in hundreds of millions of dollars conducting examinations for the VA.
Even if this man is a fine candidate on his own record, the revolving door appears to be more of a simple corridor between positions, and not worth even being discrete. Please tell me in non-idealogical terms how this situation is better to have than not.