Veterans' Disability Benefits
Further Evaluation of Ongoing Initiatives Could Help Identify Effective Approaches for Improving Claims Processing Gao ID: GAO-10-213 January 29, 2010For years, the disability compensation claims process has been the subject of concern and attention by the Department of Veterans Affairs (VA), Congress, and veteran service organizations (VSO), due in part to long waits for decisions and the large number of claims pending a decision. As GAO and other organizations have reported over the last decade, VA has also faced challenges in improving the accuracy and consistency of disability decisions. GAO was asked to examine (1) trends in VA's disability compensation claims processing at the initial claims and appeals levels and (2) actions that VA has taken to improve its disability claims process. To do this, GAO reviewed and analyzed VA performance data, budget submissions, program documents, and external studies and interviewed VA officials and VSO representatives.
VA's disability claims and appeals processing has improved in some aspects and worsened in others. In recent years, the number of claims completed annually by VA has increased but not by enough to keep pace with the increasing number of compensation claims received, resulting in more claims awaiting a decision. In addition, the average days that VA took to complete a claim--196 days in fiscal year 2008--has varied over time, but was about the same in fiscal years 2000 and 2008. Several factors have challenged claims processing improvements, such as the increase in the number and complexity of claims submitted to VA, laws, and regulatory changes. VA has reduced the number of pending appeals and improved the accuracy of some appellate work, but the time that it takes to resolve appeals has worsened in recent years. For example, in fiscal year 2008, VA took on average 776 days to process appeals; 78 days longer than in fiscal year 2004. One factor that has contributed to worsening appeals timeliness is the increase in the number of appeals received by VA. VA has taken several steps to improve claims and appeals processing, but their impact is not yet known. VA has hired a significant number of disability claims staff to process disability workloads. VA's Veterans Benefits Administration (VBA) has also expanded its practice of workload redistribution, which could improve the timeliness and quality of its decisions. VA is also testing new claims processing approaches--such as shortening response periods for certain claims and appeals through Expedited Claims Adjudication (ECA) and reorganizing its claims processing units. However, VBA has not established plans to evaluate the effect of some initiatives. In addition, VA has taken other steps to improve claims and appeals processing, such as expanding its quality assurance program; upgrading claims processing software; and moving toward paperless processing, which remains elusive in part due to technical challenges.
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Director: Team: Phone:GAO-10-213, Veterans' Disability Benefits: Further Evaluation of Ongoing Initiatives Could Help Identify Effective Approaches for Improving Claims Processing
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Report to the Committee on Veterans' Affairs, U.S. Senate:
United States Government Accountability Office:
GAO:
January 2010:
Veterans' Disability Benefits:
Further Evaluation of Ongoing Initiatives Could Help Identify
Effective Approaches for Improving Claims Processing:
GAO-10-213:
GAO Highlights:
Highlights of GAO-10-213, a report to the Committee on Veterans'
Affairs, U.S. Senate.
Why GAO Did This Study:
For years, the disability compensation claims process has been the
subject of concern and attention by the Department of Veterans Affairs
(VA), Congress, and veteran service organizations (VSO), due in part
to long waits for decisions and the large number of claims pending a
decision. As GAO and other organizations have reported over the last
decade, VA has also faced challenges in improving the accuracy and
consistency of disability decisions. GAO was asked to examine
(1) trends in VA‘s disability compensation claims processing at the
initial claims and appeals levels and (2) actions that VA has taken to
improve its disability claims process. To do this, GAO reviewed and
analyzed VA performance data, budget submissions, program documents,
and external studies and interviewed VA officials and VSO
representatives.
What GAO Found:
VA‘s disability claims and appeals processing has improved in some
aspects and worsened in others. In recent years, the number of claims
completed annually by VA has increased but not by enough to keep pace
with the increasing number of compensation claims received, resulting
in more claims awaiting a decision. In addition, the average days that
VA took to complete a claim”196 days in fiscal year 2008”has varied
over time, but was about the same in fiscal years 2000 and 2008.
Several factors have challenged claims processing improvements, such
as the increase in the number and complexity of claims submitted to
VA, laws, and regulatory changes. VA has reduced the number of pending
appeals and improved the accuracy of some appellate work, but the time
that it takes to resolve appeals has worsened in recent years. For
example, in fiscal year 2008, VA took on average 776 days to process
appeals; 78 days longer than in fiscal year 2004. One factor that has
contributed to worsening appeals timeliness is the increase in the
number of appeals received by VA.
Figure: Pending Claims and Appeals, End of Fiscal Years 2000-2008:
[Refer to PDF for image: vertical bar graph]
Fiscal year: 2000;
Pending claims: 188;
Pending appeals: 127.
Fiscal year: 2001;
Pending claims: 370;
Pending appeals: 109.
Fiscal year: 2002;
Pending claims: 309;
Pending appeals: 113.
Fiscal year: 2003;
Pending claims: 227;
Pending appeals: 124.
Fiscal year: 2004;
Pending claims: 288;
Pending appeals: 131.
Fiscal year: 2005;
Pending claims: 309;
Pending appeals: 132.
Fiscal year: 2006;
Pending claims: 335;
Pending appeals: 124.
Fiscal year: 2007;
Pending claims: 351;
Pending appeals: 112.
Fiscal year: 2008;
Pending claims: 343;
Pending appeals: 95.
Sources: VA data (claims) and GAO analysis of VA data (appeals).
[End of figure]
VA has taken several steps to improve claims and appeals processing,
but their impact is not yet known. VA has hired a significant number
of disability claims staff to process disability workloads. VA‘s
Veterans Benefits Administration (VBA) has also expanded its practice
of workload redistribution, which could improve the timeliness and
quality of its decisions. VA is also testing new claims processing
approaches”such as shortening response periods for certain claims and
appeals through Expedited Claims Adjudication (ECA) and reorganizing
its claims processing units. However, VBA has not established plans to
evaluate the effect of some initiatives. In addition, VA has taken
other steps to improve claims and appeals processing, such as
expanding its quality assurance program; upgrading claims processing
software; and moving toward paperless processing, which remains
elusive in part due to technical challenges.
What GAO Recommends:
GAO recommends that the Secretary of Veterans Affairs direct (1) VBA
to collect data on redistributed claims to help assess the effect of
workload redistribution, (2) VBA and the Board of Veterans‘ Appeals to
establish a plan with criteria for assessing whether ECA should be
widely implemented, and (3) VBA to develop a plan with criteria for
assessing whether its pilot reorganization of claims processors should
be expanded. VA agreed with the recommendations, and noted plans to
address them.
View [hyperlink, http://www.gao.gov/products/GAO-10-213] or key
components. For more information, contact Daniel Bertoni at (202) 512-
7215 or bertonid@gao.gov.
[End of section]
Contents:
Letter:
Background:
VA's Disability Claims and Appeals Processing Has Improved in Some
Aspects and Worsened in Others:
VA Has Taken Some Actions That Have the Potential to Improve Claims
Processing, but Their Impact Is Not Yet Known:
Conclusions:
Recommendations for Executive Action:
Agency Comments and Our Evaluation:
Appendix I: Objectives, Scope, and Methodology:
Appendix II: Comments from the Department of Veterans Affairs:
Appendix III: GAO Contact and Staff Acknowledgments:
Related GAO Products:
Table:
Table 1: VBA's Compensation and Pension Service's Disability Claims
Processing Teams:
Figures:
Figure 1: Overview of VA's Disability Claims and Appeals Processes:
Figure 2: Compensation Claims Received and Completed, Fiscal Years
2000-2008:
Figure 3: Pending Compensation Claims, End of Fiscal Years 2000-2008:
Figure 4: Average Days That Compensation Claims Were Pending, End of
Fiscal Years 2000-2008:
Figure 5: Average Days to Complete Compensation Claims, Fiscal Years
2000-2008:
Figure 6: Accuracy Rate of VBA Compensation Claims Decisions, Fiscal
Years 2003-2008:
Figure 7: Number of Pending Compensation Appeals, End of Fiscal Years
2000-2008:
Figure 8: Accuracy Rate of the Board's Compensation Appeals Decisions,
Fiscal Years 2000-2008:
Figure 9: Average Processing Time for Compensation Appeals, Fiscal
Years 2000-2008:
Figure 10: Number of Compensation Appeals Received, Fiscal Years 2000-
2008:
Abbreviations:
ARRA: American Recovery and Reinvestment Act of 2009:
DOD: Department of Defense:
ECA: Expedited Claims Adjudication:
STAR: Systematic Technical Accuracy Review:
VA: Department of Veterans Affairs:
VBA: Veterans Benefits Administration:
VACOLS: Veterans Appeals Control and Locator System:
VETSNET: Veterans Services Network:
VSO: veteran service organization:
[End of section]
United States Government Accountability Office:
Washington, DC 20548:
January 29, 2010:
The Honorable Daniel K. Akaka:
Chairman:
The Honorable Richard Burr:
Ranking Member:
Committee on Veterans' Affairs:
United States Senate:
The Department of Veterans Affairs' (VA) disability compensation
program provides monetary support to veterans with disabling
conditions that were incurred or aggravated during military service.
In fiscal year 2008, VA paid $30.7 billion in benefits to nearly 3
million veterans through the compensation program. For years, the
disability compensation claims process has been the subject of concern
and attention by VA, Congress, and veteran service organizations
(VSO), due in large part to long waits for decisions and the large
number of claims pending a decision. The number of veterans awaiting
decisions about their eligibility for disability compensation could
grow as servicemembers returning from ongoing conflicts and aging
veterans submit claims. As GAO and other organizations have reported
over the last decade, VA has faced challenges not only in decreasing
the time it takes to decide veterans' claims, but also with improving
the accuracy and consistency of disability decisions.
At your request, we examined (1) trends in VA's disability
compensation claims processing at the initial claims and appeals
levels and (2) actions that VA has taken to improve its disability
claims process. To identify trends in disability compensation claims
processing, we examined workload and performance data from VA's
Veterans Benefits Administration (VBA) and Board of Veterans' Appeals
(Board). To identify VA's actions for improving the claims process, we
analyzed staffing data; reviewed VA's budget submissions, VA's
strategic plan, and other documents such as external studies and VA's
Office of Inspector General reports; interviewed VA officials and VSO
representatives; and examined ongoing initiatives and those
initiatives that VA completed after fiscal year 2005. In addition, we
visited four VBA regional offices and the Board to learn about ongoing
initiatives. In selecting the regional offices--Chicago, Illinois;
Seattle, Washington; Togus, Maine; and Winston-Salem, North Carolina--
we considered regional offices that would provide (1) insights about
ongoing initiatives, such as pilots; (2) a mix of offices located in
different geographic settings (e.g., urban and rural); and (3) a mix
of offices that were above and below VBA's averages for select claims
processing measures. We also reviewed relevant federal laws,
regulations, and court decisions. Appendix I contains additional
information about our scope and methodology.
We conducted this performance audit from November 2008 through January
2010 in accordance with generally accepted government auditing
standards. Those standards require that we plan and perform the audit
to obtain sufficient, appropriate evidence to provide a reasonable
basis for our findings and conclusions based on our audit objectives.
We believe that the evidence obtained provides a reasonable basis for
our findings and conclusions based on our audit objectives.
Background:
VA pays monthly disability compensation to veterans with service-
connected disabilities (i.e., injuries or diseases incurred or
aggravated while on active military duty) according to the severity of
the disability.[Footnote 1] VA also pays additional compensation for
some dependents--spouses, children, and parents--of veterans.[Footnote
2] In addition, VA's pension program pays benefits to low-income
veterans who either are elderly or have disabilities unrelated to
their military service.[Footnote 3] In fiscal year 2008, the
disability compensation program represented 78 percent, or $30.7
billion, of the cash benefits paid through VBA's Compensation and
Pension Service.
VA's disability compensation claims process starts when a veteran
submits a claim to VBA (see figure 1). Upon reviewing the claim at 1
of VBA's 57 regional offices, a service representative then assists
the veteran in gathering the relevant evidence to evaluate the claim.
[Footnote 4] Such evidence includes veterans' military service
records, medical examinations, and treatment records from VA medical
facilities and private medical service providers. Also, if necessary
for reaching a decision on a claim, the regional office arranges for
the veteran to receive a medical examination. Once a claim has all of
the necessary evidence, a rating specialist evaluates the claim and
determines whether the claimant is eligible for benefits.[Footnote 5]
If so, the rating specialist assigns a percentage rating. Veterans
with multiple disabilities receive a single composite rating. Veterans
can reopen claims for additional benefits from VA if, for example, a
service-connected disability worsens or arises in the future. If the
veteran disagrees with the regional office's decision, he or she may
submit a written notice of disagreement to the regional office. In
response to such a notice, VBA reviews the case and provides the
veteran with further written explanation of the decision if VBA does
not grant all appealed issues. If the veteran still disagrees, he or
she may appeal to the Board. Before transferring the appeal to the
Board, VBA re-reviews the case and if any new information is obtained
provides a new explanation of the decision to the veteran. The Board,
whose members are attorneys experienced in veterans' law and in
reviewing benefit claims, conducts a hearing if the veteran requests
one, then grants or denies the appeal or returns the case to VBA to
obtain additional evidence necessary to decide the veteran's claim. If
the veteran is dissatisfied with the Board's decision, he or she may
appeal to the U.S. Court of Appeals for Veterans Claims.
Figure 1: Overview of VA's Disability Claims and Appeals Processes:
[Refer to PDF for image: illustration]
Claims Process:
Veteran:
Submits claim.
Veterans Benefits Administration (VBA):
Reviews claim;
Obtains and helps gather evidence[A];
Rates claim;
Processes decision and provides a written explanation (to Veteran).
Appeals Process:
Veteran:
If dissatisfied, submits a notice of disagreement to VBA.
VBA:
Reviews claim and provides a written explanation of decision[B].
Veteran:
If dissatisfied, appeals to the Board.
VBA:
Obtains and helps gather any needed evidence[A]; re-reviews case and
writes new explanation of decision if additional evidence is
obtained[B]; and certifies that appeal is ready for the Board.
Board of Veterans‘ Appeals (Board):
Conducts a hearing if claimant requests;
Grants or denies appeal, or;
Remands case to VBA.
Veteran:
If dissatisfied, appeals to the U.S. Court of Appeals for Veterans
Claims.
Source: GAO analysis of VA procedures.
[A] VA must make reasonable efforts to help a claimant obtain evidence
that is necessary to substantiate a claim.
[B] The explanation must include a summary of the evidence relating to
the contested issue(s), a summary of the applicable laws and
regulations, VBA's determination of each issue, and the rationale for
such determinations. The process ends if VBA grants all appealed
issues or if the veteran is satisfied with the explanation.
[End of figure]
To improve workload controls and the timeliness and accuracy of its
decisions, in fiscal year 2002, VBA organized its claims processing
staff by teams that perform distinct phases of the claims and appeals
processes (see table 1). In moving toward this organizational
structure, VBA sought to reduce the number of tasks a veteran service
representative was expected to perform and thereby improve its
performance.
Table 1: VBA's Compensation and Pension Service's Disability Claims
Processing Teams:
Team: Triage Team;
Summary of claims processing duties: Reviews claims and establishes
the regional office's tracking procedures for all mail, as well as
processes claims that only require a brief review to determine
eligibility.
Team: Pre-Determination Team;
Summary of claims processing duties: Obtains and helps gather evidence
for disability ratings, and prepares administrative decisions.
Team: Rating Team;
Summary of claims processing duties: Makes decisions on claims that
require consideration of medical evidence.
Team: Post-Determination Team;
Summary of claims processing duties: Develops evidence for nonrating
issues, processes benefit awards, and notifies veterans of rating
decisions.
Team: Public Contact Team;
Summary of claims processing duties: Conducts personal interviews and
handles telephone inquiries, including calls from veterans.
Team: Appeals Team;
Summary of claims processing duties: Handles requests for
reconsideration of claims in cases where veterans have submitted a
notice of disagreement.
Source: VBA.
Note: The Rating Team is made up of rating specialists; the Post-
Determination and Public Contact teams are made up of veteran service
representatives; and the Pre-Determination, Triage, and Appeals teams
are made up of both rating specialists and veteran service
representatives.
[End of table]
VA measures its performance related to compensation claims and appeals
processing in various ways and considers the timeliness and quality of
its decisions as key indicators. One way that VBA and the Board assess
the timeliness of their work is using a joint measure that considers
the average time it takes appeals to be resolved, regardless of
whether they are resolved by VBA or the Board. In fiscal year 2009,
VA's timeliness goal for resolving appeals was 675 days.[Footnote 6]
In terms of quality, VBA and the Board each assess the accuracy of
their decisions by reviewing randomly selected cases to determine the
proportion that contain errors that could affect the benefits paid to
the veteran. In fiscal year 2009, VBA and the Board had an accuracy
rate goal of 98 percent and 94 percent, respectively.[Footnote 7]
VA's Disability Claims and Appeals Processing Has Improved in Some
Aspects and Worsened in Others:
Over the past several years, the number of disability compensation
claims has increased, and VA's performance in processing such claims
has improved in some areas and worsened in others. During this time,
VA has reduced the number of pending appeals and improved the accuracy
of some appellate work, but in recent years, the time that it takes to
resolve appeals has increased.
VA Has Increased Its Output of Claims Decisions but Continues to
Experience Some Challenges with Timeliness and Accuracy:
From fiscal years 2000 to 2008, the number of claims completed
annually by VA has increased but not by enough to keep pace with the
increasing number of compensation claims it has received, and, as a
result, the number of pending claims has grown. VA has substantially
increased the number of claims it completes annually in recent years.
In fiscal year 2008, VA completed about 729,000 claims, which was
nearly 66 percent more than it completed in fiscal year 2000 (see
figure 2).[Footnote 8] However, VA has also received significantly
more claims in recent years. In fiscal year 2008, VA received about
719,000 compensation claims, which was about 71 percent more than it
received in fiscal year 2000. By the end of fiscal year 2008, pending
claims--those awaiting a decision--had increased 83 percent over
fiscal year 2000 levels, from about 188,000 to about 343,000 (see
figure 3). Moreover, the number of claims awaiting a decision longer
than 6 months increased about 50 percent, from about 52,000 to about
78,000.
Figure 2: Compensation Claims Received and Completed, Fiscal Years
2000-2008:
[Refer to PDF for image: vertical bar graph]
Fiscal year: 2000;
Claims received: 421;
Claims completed: 440.
Fiscal year: 2001;
Claims received: 531;
Claims completed: 348.
Fiscal year: 2002;
Claims received: 579;
Claims completed: 641.
Fiscal year: 2003;
Claims received: 601;
Claims completed: 683.
Fiscal year: 2004;
Claims received: 632;
Claims completed: 571.
Fiscal year: 2005;
Claims received: 649;
Claims completed: 629.
Fiscal year: 2006;
Claims received: 654;
Claims completed: 628.
Fiscal year: 2007;
Claims received: 678;
Claims completed: 662.
Fiscal year: 2008;
Claims received: 719;
Claims completed: 729.
Source: VA data.
[End of figure]
Figure 3: Pending Compensation Claims, End of Fiscal Years 2000-2008:
[Refer to PDF for image: vertical bar graph]
Fiscal year: 2000;
Total pending: 188;
Pending over 6 months: 52.
Fiscal year: 2001;
Total pending: 370;
Pending over 6 months: 159.
Fiscal year: 2002;
Total pending: 309;
Pending over 6 months: 114.
Fiscal year: 2003;
Total pending: 227;
Pending over 6 months: 44.
Fiscal year: 2004;
Total pending: 288;
Pending over 6 months: 64.
Fiscal year: 2005;
Total pending: 309;
Pending over 6 months: 68.
Fiscal year: 2006;
Total pending: 335;
Pending over 6 months: 78.
Fiscal year: 2007;
Total pending: 351;
Pending over 6 months: 96.
Fiscal year: 2008;
Total pending: 343;
Pending over 6 months: 78.
Source: VA data.
[End of figure]
VA has also experienced mixed results in improving the timeliness of
its claims decisions. Overall, the average days that claims were
pending declined, but the average processing time needed to complete a
claim did not improve.[Footnote 9] From fiscal years 2000 to 2008, the
average number of days that claims were pending fluctuated. In fiscal
year 2008, compensation claims were pending an average of 23 days less
than the 146 days in fiscal year 2000 (see figure 4).[Footnote 10]
While fiscal year 2008's average number of days pending was slightly
longer than the average 115 days experienced in fiscal year 2003, it
is a marked improvement over the 188 days that claims were pending in
fiscal year 2001. VA has also reduced the percentage of claims that
took more than 1 year to complete, from 22 percent in fiscal year 2002
to 10 percent in fiscal year 2008. However, VA has made little
progress in reducing average processing times. The average time that
VA took to complete a claim fluctuated between fiscal years 2000 and
2008, from a high of 246 days in fiscal year 2002 to a low of 181 days
in fiscal years 2004 and 2005 (see figure 5). Since then, this average
has increased, and in fiscal year 2008, VA took about the same amount
of time--196 days--to complete a claim as it did in fiscal year 2000.
[Refer to PDF for image]
[End of figure]
Figure 4: Average Days That Compensation Claims Were Pending, End of
Fiscal Years 2000-2008:
[Refer to PDF for image: vertical bar graph]
Fiscal year 2000: 146 days;
Fiscal year 2001; 188 days;
Fiscal year 2002: 181 days;
Fiscal year 2003: 115 days;
Fiscal year 2004: 122 days;
Fiscal year 2005: 124 days;
Fiscal year 2006: 132 days;
Fiscal year 2007: 137 days;
Fiscal year 2008: 123 days.
Source: VA data.
[End of figure]
Figure 5: Average Days to Complete Compensation Claims, Fiscal Years
2000-2008:
[Refer to PDF for image: vertical bar graph]
Fiscal year 2000: 195 days;
Fiscal year 2001; 202 days;
Fiscal year 2002: 246 days;
Fiscal year 2003: 197 days;
Fiscal year 2004: 181 days;
Fiscal year 2005: 181 days;
Fiscal year 2006: 193 days;
Fiscal year 2007: 200 days;
Fiscal year 2008: 198 days.
Source: VA data.
[End of figure]
In terms of quality, according to VA's assessments, the accuracy of
compensation claims processing remained about the same during fiscal
years 2003 through 2008.[Footnote 11] The percentage of compensation
claims processed without errors that could affect benefits paid to
veterans remained at 85 percent, varying slightly in the intervening
years (see figure 6).
Figure 6: Accuracy Rate of VBA Compensation Claims Decisions, Fiscal
Years 2003-2008:
[Refer to PDF for image: vertical bar graph]
Fiscal year 2003: 85%;
Fiscal year 2004: 85%;
Fiscal year 2005: 83%;
Fiscal year 2006: 88%;
Fiscal year 2007: 87%;
Fiscal year 2008: 85%.
Source: VA data.
[End of figure]
One factor that has contributed to VA's lack of significant
improvement in claims processing performance is the substantial
increase in VA's disability workloads. VA attributes the increase in
compensation claims to several sources, including the conflicts in
Iraq and Afghanistan. According to VA, about 35 percent of veterans
from ongoing hostilities file claims. In addition, VA cites the
growing number of reopened claims from current disability benefit
recipients--many of whom suffer from chronic progressive disabilities,
such as diabetes--who submit claims for increased benefits as their
conditions worsen or new conditions arise as they age. In fiscal year
2008, VA received about 488,000 reopened claims for disability
benefits, up 58 percent from about 309,000 in fiscal year 2000. In
addition, VA attributes increased claims receipt to its enhanced
outreach to servicemembers and veterans. VA reported that in fiscal
year 2007, it provided benefits briefings to about 297,000 separating
servicemembers, which was up from about 210,000 in fiscal year 2003.
According to VA officials, federal laws, VA regulations, and court
decisions have also adversely affected claims processing timeliness.
These changes enable veterans to get the benefits they deserve.
However, the changes expand benefit entitlement and add processing
requirements that increase VA's workloads. In recent years, court
decisions related to a 1991 law have created new presumptions of
service-connected disabilities for many Vietnam veterans.[Footnote 12]
In October 2009, VA announced that it was expanding the list of
presumptive service-connected disabilities to include Parkinson's
disease and two other conditions for Vietnam veterans.[Footnote 13] VA
also anticipates an increase in claims stemming from an October 2008
regulation change that affects how VA rates traumatic brain injuries.
[Footnote 14] According to a VA official, a letter was sent to
approximately 32,000 veterans notifying them that their rating for
traumatic brain injury could potentially increase, even though their
symptoms may not have changed. In addition to expanded benefit
entitlement, a number of laws[Footnote 15] and court
decisions[Footnote 16] related to VA's disability claims process have
had implications for timely claims processing. For example, according
to VA officials, the Veterans Claims Assistance Act of 2000 added more
steps to the claims process, lengthening the time that it takes to
develop and decide a claim.[Footnote 17]
Another factor impacting VA's claims processing timeliness is the
complexity of claims received. VA notes that it is receiving more
claims for complex disabilities related to combat and deployments
overseas, including those based on environmental and infectious
disease risks and traumatic brain injuries. In addition, veterans
cited more disabilities in their claims in recent years than they had
in the past. The number of compensation claims VA decided with eight
or more disabilities increased from 11 to 16 percent from fiscal years
2006 to 2008. These claims can take longer to complete because each
disability must be evaluated separately.
VA Has Reduced the Number of Pending Appeals and Improved the Accuracy
of Some Appellate Work, but Appeals Processing Timeliness Has Worsened
in Recent Years:
Since fiscal year 2000, the number of pending appeals has declined,
and the accuracy of appeals processing has improved in some areas. VA
has reduced the number of pending appeals by 25 percent, from about
127,000 in fiscal year 2000 to about 95,000 in fiscal year 2008 (see
figure 7).[Footnote 18] Over the same period, agency accuracy reviews
indicate that 95 percent of the Board's decisions in fiscal year 2008
were processed accurately compared with 86 percent in fiscal year 2000
(see figure 8). Another indicator of the accuracy of appeals
processing is the percentage of appeals that are remanded to VBA by
the Board due to errors that could have been avoided.[Footnote 19]
Examples of avoidable remands include VBA's failure to obtain
identified private treatment records or to send letters to claimants
indicating what evidence is necessary to substantiate the claim. One
of VA's goals is to eliminate avoidable remands.[Footnote 20] Although
VBA recently expanded accuracy reviews and the Board has provided
training to VBA staff based on remand reason trends, the percentage of
appeals with avoidable remands remained about 25 percent from fiscal
years 2006 to 2008.[Footnote 21]
Figure 7: Number of Pending Compensation Appeals, End of Fiscal Years
2000-2008:
[Refer to PDF for image: vertical bar graph]
Fiscal year 2000: 127,000;
Fiscal year 2001; 109,000;
Fiscal year 2002: 113,000
Fiscal year 2003: 124,000;
Fiscal year 2004: 131,000;
Fiscal year 2005: 132,000;
Fiscal year 2006: 124,000;
Fiscal year 2007: 112,000;
Fiscal year 2008: 95,000.
Source: GAO analysis of VA data.
[End of figure]
Figure 8: Accuracy Rate of the Board's Compensation Appeals Decisions,
Fiscal Years 2000-2008:
[Refer to PDF for image: vertical bar graph]
Fiscal year 2000: 85%;
Fiscal year 2001; 88%;
Fiscal year 2002: 86%;
Fiscal year 2003: 85%;
Fiscal year 2004: 84%;
Fiscal year 2005: 82%;
Fiscal year 2006: 90%;
Fiscal year 2007: 93%;
Fiscal year 2008: 95%.
Source: GAO analysis of VA data.
[End of figure]
Despite improvements in some aspects of appeals processing, the
average time needed to resolve appeals has worsened in recent years,
reversing prior improvements. In fiscal year 2008, the average
processing time for compensation appeals was 776 days, or
approximately 25 months, despite reaching lows of 656 days in fiscal
year 2001 and 680 days in fiscal year 2005 (see figure 9). The
majority of appeal processing time is spent developing the appeal
prior to consideration by the Board. For example, appeals resolved in
fiscal year 2008 remained at VBA for 502 days before being transferred
to the Board.[Footnote 22]
Figure 9: Average Processing Time for Compensation Appeals, Fiscal
Years 2000-2008:
[Refer to PDF for image: vertical bar graph]
Fiscal year 2000: 769 days;
Fiscal year 2001; 656 days;
Fiscal year 2002: 835 days;
Fiscal year 2003: 838 days;
Fiscal year 2004: 698 days;
Fiscal year 2005: 680 days;
Fiscal year 2006: 719 days;
Fiscal year 2007: 758 days;
Fiscal year 2008: 776 days.
Source: GAO analysis of VA data.
[End of figure]
Several factors have contributed to the worsening trend in appeals
timeliness. First, the number of appeals that VA has received
increased about 50 percent from approximately 24,000 in fiscal year
2000 to about 36,000 in fiscal year 2008 (see figure 10). In addition,
according to VA officials, each time appellants submit new evidence,
VA must review and summarize the case for the appellant again, adding
to the time that it takes to resolve the appeal. Furthermore, a
veteran may submit multiple claims, and VBA does not forward an appeal
to the Board until all of a veteran's pending claims are resolved,
regardless of whether they relate to the appeal. This practice follows
VBA's interpretation of a court decision to prevent delays in
processing undecided claims.[Footnote 23] Therefore, a veteran's
unrelated, pending claim could forestall final resolution of the
appeal. Finally, according to VA officials, processing time is
lengthened when appeals are remanded back to VBA by the Board. While
some appeals are remanded due to procedural errors by VBA, many other
appeals are remanded because of requirements often driven by recent
court decisions or regulatory changes that occur after the appeal is
sent to the Board. For example, a court decision in January 2008
required VA to notify veterans seeking increased compensation for
worsened conditions of the rating criteria that pertain to the claim.
[Footnote 24] Until this decision was overturned in September 2009, it
required the Board to remand--or VBA to hold back--any appeals until
the claimants were notified.[Footnote 25]
Figure 10: Number of Compensation Appeals Received, Fiscal Years 2000-
2008:
[Refer to PDF for image: vertical bar graph]
Fiscal year 2000: 24,000;
Fiscal year 2001; 12,000;
Fiscal year 2002: 17,000;
Fiscal year 2003: 34,000;
Fiscal year 2004: 41,000;
Fiscal year 2005: 38,000;
Fiscal year 2006: 38,000;
Fiscal year 2007: 37,000;
Fiscal year 2008: 36,000.
Source: GAO analysis of VA data.
[End of figure]
VA Has Taken Some Actions That Have the Potential to Improve Claims
Processing, but Their Impact Is Not Yet Known:
VA has taken several steps to improve claims processing, including
increasing claims processing staff, redistributing certain workloads,
piloting alternative approaches to processing certain claims, and
increasingly leveraging information technology to process claims. VA
expects these actions to improve decision timeliness, quality, or
both. However, the effects of these actions are not yet known, and VA
lacks plans to assess certain actions.
VA Has Increased Staffing, Redistributed Workloads, and Is Piloting
New Approaches for Processing Certain Claims to Improve Timeliness,
but Lacks Plans to Evaluate Some of These Actions:
VA has taken several actions to improve decision timeliness at both
the claim and appellate levels. For example, over the past few years,
VA has hired a significant number of disability claims staff to
process disability workloads. From fiscal years 2005 to 2009, VA
increased VBA's claims processing staff by 57 percent, from 7,550 to
11,868.[Footnote 26] This increase includes 417 staff that VBA hired
in fiscal year 2009 using funds from the American Recovery and
Reinvestment Act of 2009 (ARRA).[Footnote 27] Of the people hired
using ARRA funds, about three-fourths are temporary employees who
assist in developing disability claims and perform other
administrative tasks to free experienced staff to complete more
complex claims processing tasks. During the same period, VA increased
the Board's staff by 20 percent, from 433 to 519, without using ARRA
funds.
We have reported that adding staff has the potential to improve VA's
capacity to complete more claims, but an infusion of a large number of
new staff will also likely pose human capital challenges for VA in the
near term.[Footnote 28] VA has processed more claims and appeals
decisions annually since hiring the additional staff; however, as it
has acknowledged, individual staff productivity has decreased.
Specifically, the number of rating-related claims processed per staff
person declined from 101 in fiscal year 2005 to 88 in fiscal year
2008. According to VA, this decline in productivity is attributable
primarily to new staff who have not yet become fully proficient at
processing claims and to the loss of experienced staff due to
retirements. VA expects individual productivity to decline further
before it improves, in part because of the challenge of training and
integrating new staff.[Footnote 29] According to a VA official in
charge of training, VA's goal is for newly hired veteran service
representatives to be proficient in 18 months, and for newly hired
rating specialists to be proficient in 2 years. However, according to
VA officials, particularly for rating specialists, becoming proficient
often takes longer--about 3 to 5 years--because of the complexity of
the job, in part given the variety of cases and rating issues.
Training new staff also reduces productivity in the near term because
experienced staff must take time to train and mentor them and,
therefore, may have less time to process their own claim workloads.
According to a VBA training official, VBA has developed curricula that
use practical application of key concepts to accelerate the learning
curve for new staff. VA expects that the staff hired with ARRA funding
will help increase the number of claims processed and reduce average
processing times in 2010. However, even though their responsibilities
are expected to be limited to less complex claims processing tasks,
these additional staff could also pose human capital challenges in the
near term while they are being trained and deployed.
VBA has also expanded its practice of redistributing regional offices'
disability workloads. Although this expansion could improve the
timeliness of its decisions, VBA has not collected data to evaluate
the effect of this practice. Since 2001, VBA has created 15 resource
centers that are staffed exclusively to process claims or appeals from
backlogged regional offices at distinct phases in the claims process.
[Footnote 30] From 2001 to 2002, VBA created 9 resource centers to
exclusively rate claims (rating centers) from other offices. Since
2007, VBA has created 4 additional resource centers to exclusively
develop claims (development centers) for rating. In 2009, VBA created
2 more resource centers that focus exclusively on processing appealed
claims (appeals centers) before they are sent to the Board. The
development resource centers obtain information necessary for rating
claims, while the appeals resource centers review appeals and provide
written summaries of cases for the veterans. VBA determines the number
of claims redistributed to each of the resource centers on the basis
of the regional offices' and resource centers' changing workloads and
capacities.[Footnote 31] Claims initially had to meet specific
criteria to be eligible for redistribution, such as having seven or
fewer disabilities. However, VBA relaxed these criteria in May 2008 to
allow more claims to be redistributed. The number of claims
redistributed for rating has increased from about 88,000 in fiscal
year 2006 to about 140,000 in fiscal year 2008.
While redistributing workloads is helpful, this practice can pose
operational challenges. According to several VSO representatives,
redistributing claims reduces VSOs' and VA's ability to monitor claims
processing. Also, according to some resource center staff we
interviewed, workload redistribution sometimes creates inefficiencies.
For example, one rating resource center returned about 20 percent of
the claims that it received during the first half of fiscal year 2009
to the originating regional offices because the claims required
further development before they could be rated. The resource centers
provide written explanations for returned claims, so that regional
offices can correct the errors and avoid them in the future. Despite
such challenges, according to VBA officials, redistributing backlogged
claims to resource centers improves average processing times because
VBA can better leverage the ever-changing capacities of its offices.
Although VBA tracks the number of claims processed--and recently
started monitoring accuracy--by resource center, it does not track the
average processing times of redistributed workloads. Therefore, VA
cannot (1) compare the average processing times of redistributed
versus nonredistributed claims and (2) assess the resource centers
relative to key performance goals or the overall effect of expanded
workload redistribution on claims processing.
In addition to increasing staffing and redistributing workloads, VA is
piloting several new approaches for processing certain claims to
improve timeliness. For example, VA is implementing a pilot with the
Department of Defense (DOD) to perform disability evaluations. Begun
in November 2007, the joint DOD-VA pilot process applies to
servicemembers navigating the military's disability evaluation system,
which determines whether servicemembers are fit for duty or should be
released from the military.[Footnote 32] In the pilot, VA completes
disability ratings for servicemembers found to be unfit for duty. Key
features of the pilot include a single physical examination conducted
to VA standards, disability ratings prepared by VA for use by both DOD
and VA in determining disability benefits, and additional outreach and
case management provided by VA staff at DOD pilot locations to explain
VA results and processes to servicemembers. The goals of the pilot are
to increase transparency and reduce confusion about the disability
evaluations conducted and, if military separation or retirement is
necessary, to expedite VA disability compensation benefits upon
discharge. If implemented widely, the pilot process could change the
way in which many veterans first receive disability benefits from VA.
[Footnote 33] According to DOD, preliminary pilot results suggest that
the new process expedites delivery of VA benefits to servicemembers
following discharge from the military. However, the number of claims
affected by widespread implementation of the DOD-VA pilot process
would probably be small compared with the total number of compensation
claims processed by VA. In fiscal year 2008, the military's disability
evaluation system caseload was approximately 20,000, while VA
processed about 729,000 compensation claims that year.[Footnote 34]
VA is also piloting another new approach to process certain
compensation claims and appeals, but it has not yet established a plan
to determine whether the pilot process is worthy of widespread
implementation. In February 2009, VA launched a 2-year pilot called
Expedited Claims Adjudication (ECA) in 4 regional offices. This pilot,
a joint effort between VBA and the Board, is intended to accelerate
the processing time of claims and appeals. Claimants who opt into the
ECA pilot agree to respond to VA within time frames that are shorter
than generally required. For example, participating claimants agree to
submit any notice of disagreement with VBA's decision within 60 days
as opposed to within 365 days under VA's normal requirements.[Footnote
35] In return, the expectation is that claimants will receive
decisions from VBA--and from the Board if the claimant appeals the
decision--more quickly. VA is collecting data on the timeliness of ECA
processing compared with that of non-ECA processing, but complete data
are not yet available. VA officials said they intend to evaluate ECA
before expanding the expedited process within the agency. However, it
is unclear when and how VA will conduct such an evaluation because it
has not yet established an evaluation plan with specific criteria and
methods to help assess ECA's impact on non-ECA claims and appeals
processing and on whether ECA is worthy of expansion. For example, it
is unclear which timeliness metrics VA will use to help assess ECA,
and the performance goals the new process must meet before being
expanded.
As required under the Veterans' Benefits Improvement Act of 2008,
[Footnote 36] VA is also piloting an expedited claims process for
claimants who submit "fully developed claims"[Footnote 37] and affirm
that they do not intend to submit additional information to support
their claims.[Footnote 38] In return, VA's goal is to process such
claims within 90 days of receipt of the claim. VA is piloting this
alternative process at 10 regional offices for at least 1 year, and
the agency has hired a contractor to help assess the feasibility and
advisability of continuing the pilot, and possibly deploying the
process nationwide. Because certain types of claims--such as those
from newer veterans--may naturally lend themselves to being fully
developed and therefore may not be representative of all claims, the
contractor will not merely compare the average processing times for
fully developed claims with those of other claims. Instead, the
contractor is working with VA to identify a sound and feasible
methodology for evaluating this alternative claims process and is
scheduled to provide VA with an evaluation of the pilot at the end of
May 2010.
VA Is Piloting a Reorganization and Has Implemented Quality Assurance
and Technology-Related Initiatives That Could Improve Decision Quality
and Timeliness in the Future:
VA has taken several additional steps that could improve the quality
and timeliness of its decisions for compensation claims. For example,
in July 2009, VA began piloting at one regional office a
reorganization of its claims processors into groups that are
collectively responsible for gathering the evidence for a claim,
rating the claim, and processing the decision. This structure is
different from the current organization, which has distinct teams for
each phase of the claims process. This reorganization is based on a
recent recommendation from a consulting firm that studied VA's rating-
related claim development process.[Footnote 39] In addition to
reducing claim folder movement and thus potentially reducing the
average processing time, the reorganization is intended to increase
claims processing staff's appreciation for how their work quality
impacts other aspects of the process. Although some VA officials
expressed skepticism that this reorganization would significantly
improve the agency's performance in processing compensation claims,
they also acknowledged its potential benefits. According to VA
officials, VA plans to evaluate the pilot in May 2010, but it has not
yet established specific criteria for expanding the reorganization to
other locations. Similar to the ECA pilot, VA has not yet specified
which metrics it will use to help assess the pilot, and the goals that
the new process must meet before being expanded.
VA has also expanded its capacity to measure claims and appeals
processing quality, which it uses to help monitor performance and
identify training opportunities for staff. For example, in fiscal year
2008, VA doubled the number of staff working in VBA's quality
measurement group from about 10 to 20 staff to improve its ability to
assess the accuracy of claim decisions and appellate work. In fiscal
year 2008, this group more than doubled the number of claims it
reviews for accuracy from 10 to 21 cases per month, per regional
office. In addition, in fiscal year 2009, based in part on a VA
inspector general recommendation, VBA began monitoring the accuracy of
claims decided by rating resource centers as it does for regional
offices.[Footnote 40] Moreover, starting in fiscal year 2008, based in
part on our prior recommendation,[Footnote 41] VBA's quality
measurement group began conducting studies to monitor the extent to
which veterans with a similar disability receive consistent ratings
across regional offices. According to VA officials, VBA's quality
measurement group conducted four consistency studies in fiscal year
2008. VBA used these studies to identify training needs--such as how
to verify a stressor for post-traumatic stress disorder--at specific
regional offices. The group had planned to conduct additional
consistency studies the following year, but because it doubled the
number of case reviews and conducted ad hoc, focused reviews (e.g., of
appellate work), it was not able to conduct further consistency
studies. However, in fiscal year 2008, VBA's quality measurement group
began testing the consistency of decisions made by claims processing
staff at different locations on a hypothetical claim.[Footnote 42] The
group conducted two of these consistency tests during fiscal years
2008 and six tests in fiscal year 2009. VBA has used the results of
these tests to help identify training needs related to rating certain
disabilities, such as cardiovascular conditions.
VA has also leveraged technology in recent years to improve claims
processing. For example, VA has upgraded its claims processing
software in phases to enhance its ability to track information about
claims and reduce the need for duplicative data entry that could
introduce errors. According to VA, a software upgrade in October 2007
improved staff's ability to manage their workloads and more easily
identify priority cases, such as those for veterans returning from the
current conflicts in Iraq and Afghanistan, by electronically filtering
and sorting pending claims. Other claims processing software upgrades
have allowed VA to capture management information that is essential to
conducting more robust analyses on claims processing performance. For
example, the prior software system did not allow VA to electronically
capture more than six conditions per claim. With its current claims
processing software, VA captures information on the actual number of
claimed conditions, which in turn allows VA to analyze claim
development time by condition.
Finally, VA has also begun processing certain compensation claims with
less reliance on paper claim files, but widespread paperless
processing remains elusive, in part because of technical challenges.
As of October 2008, claims processing staff at two regional offices
review scanned versions of all compensation claims filed by
servicemembers 60 to 180 days before leaving the military, known as
Benefits Delivery at Discharge claims.[Footnote 43] According to VA
officials, this process is currently as efficient as paper-based
processing, but may eventually be more efficient and enable further
redistribution of case processing as regional offices' changing
capacities and workloads require. In addition, in the spring of 2009,
VA designated one of its regional offices to test emerging
technologies and processes in a real setting to gauge their potential
impact on the agency and its employees. For example, VA recently used
this office to test the impact of claims processing staff using only
electronic information as opposed to hard-copy reference materials to
process claims. VA hopes to further test paperless claims processing.
However, officials said that the current system's infrastructure
cannot sustain the high volume of data needed to process paperless
claims on a widespread basis. Even in processing Benefits Delivery at
Discharge claims--which comprise a small fraction of total
compensation claims--the system infrastructure used to process such
claims occasionally malfunctions. Although VA has taken some steps to
strengthen its claims processing system's infrastructure, technical
challenges persist, especially given the volume of evidence generally
received for claims and the piecemeal, paper-based fashion in which VA
often receives the information. These factors challenge VA as it works
toward having a fully paperless claims processing system by the end of
2012.
Conclusions:
For years, VA's disability claims and appeals processes have received
considerable attention as VA has struggled to process an increasing
number of claims from both veterans of recent conflicts as well as
aging veterans from prior conflicts. Although VA workload and
performance data indicate that VA has made progress in improving some
aspects of its disability claims and appeals processing over the past
decade, VA continues to wrestle with ongoing challenges that may not
be resolved in the near future. Specifically, significant increases in
claims workloads, complicated by more conditions per claim and human
capital challenges associated with training and integrating VA's large
influx of new staff continue to contribute to lengthy processing times
and a large pending claims inventory.
VA has little or no control over some contributors to its increasing
workload, but it has taken steps to address some internal
inefficiencies and challenges that persist within its disability
claims and appeals processes. Some of VA's key actions, including its
expansion of workload redistribution to resource centers and separate
pilots aimed at reducing processing times, have the potential to
improve the claims and appeals processes. However, without fully
evaluating these actions, VA will not have the necessary information
to determine their effectiveness and whether VA should continue to
invest its limited resources in them. For example, workload
redistribution to resource centers has the potential to improve
services to veterans, but without tracking the timeliness and accuracy
of the decisions processed by these centers, VA will not be able to
fully monitor the centers' performance and will lack key inputs for
determining whether they yield positive returns on investment. As a
result, VA could miss out on opportunities to either increase
efficiencies by adding more resource centers, or to scale back
workload redistribution if it is not having the desired effect. In
addition, absent an evaluation plan or specific criteria for measuring
the effect of its ECA and reorganization pilots, VA may not be able to
determine whether they are successful or to make well-informed
decisions about expanding them. Considering the challenges VA faces
and will likely face in the future, it is important that VA make
effective long-term decisions based on solid data to improve benefit
delivery for veterans.
Recommendations for Executive Action:
We recommend that the Secretary of Veterans Affairs direct:
1. VBA to collect data on redistributed claims for development,
rating, and appellate work to help assess the timeliness and accuracy
of resource centers' output and the effectiveness of workload
redistribution.
2. VBA and the Board to establish an evaluation plan for assessing the
ECA pilot process and guiding any expansion decisions. Such a plan
should include criteria for determining how much improvement should be
achieved under the pilot on specific performance measures--such as
average VBA and Board processing times--and include methods for how
VBA and the Board will consider ECA's impact on non-ECA claims and
appeals processing before implementing the process widely.
3. VBA to establish a plan to evaluate its claims processing
reorganization pilot and guide any expansion decisions. Such a plan
should include criteria for determining how much improvement should be
achieved in the pilot on specific performance measures--such as
decision timeliness and accuracy--before the process is implemented
throughout VBA.
Agency Comments and Our Evaluation:
We provided a draft of this report to VA for review and comment. VA
generally agreed with our conclusions and concurred with our
recommendations. Its written comments are reproduced in appendix II.
VA agreed with our recommendation that VBA collect data on
redistributed claims and appellate work to help assess the timeliness
and accuracy of resource centers' output and the effectiveness of
workload redistribution. VA stated that, by March 2010, VBA plans to
change a primary workload management tool to help collect timeliness
data of redistributed work. Analyzing such timeliness data along with
other factors, such as quality and cost, will be helpful in evaluating
the effectiveness of workload redistribution.
VA also agreed with our recommendation that VBA and the Board
establish an evaluation plan for assessing the ECA pilot process, and
stated that the Board will work with VBA to establish evaluation
criteria and explore the potential impact of ECA on non-ECA claims and
appeals processing. VA stated that the Board hopes to complete an
evaluation of ECA and make recommendations regarding potentially
expanding the pilot process or permanently incorporating successful
aspects of it by the end of fiscal year 2010. We applaud VA's intent
to evaluate the pilot and encourage VA to take steps to ensure that
the evaluation design and criteria yield valid information for making
decisions regarding expansion.
Finally, VA agreed with our recommendation that VBA establish a plan
to evaluate its claims processing reorganization pilot, and provided
critical factors that VBA and a private consulting firm established to
help assess and report on the pilot. Identifying these factors is an
important start; however, we believe that VBA should also establish
the minimum levels of performance improvement by factor that should be
achieved before the pilot process is considered successful and worthy
of expansion.
We are sending copies of this report to the relevant congressional
committees, the Secretary of Veterans Affairs, and other interested
parties. The report is also available at no charge on GAO's Web site
at [hyperlink, http://www.gao.gov].
If you or your staffs have any questions concerning this report,
please contact me at (202) 512-7215 or bertonid@gao.gov. Contact
points for our Offices of Congressional Relations and Public Affairs
may be found on the last page of this report. Staff members who made
key contributions to this report are listed in appendix III.
Signed by:
Daniel Bertoni:
Director, Education, Workforce, and Income Security Issues:
[End of section]
Appendix I: Objectives, Scope, and Methodology:
The objectives of our review were to examine (1) trends in the
Department of Veterans Affairs' (VA) disability compensation claims
processing at the claims and appellate levels and (2) actions that VA
has taken to improve its disability claims process. For both
objectives, we focused our analysis on VA's processing of disability
compensation for veterans as opposed to other types of benefits, such
as pensions.
To examine workload and performance trends, we analyzed compensation
claims processing data from VA's Veterans Benefits Administration
(VBA) and Board of Veterans' Appeals (Board). In addition, we
interviewed VA officials familiar with the claims process and reviewed
VA annual performance reports and other documents to understand data
trends and related VA challenges and to corroborate our findings.
Further information about our analysis of VA workload and performance
data is provided in the following text.
To identify actions that VA has taken to improve its disability
compensation claims and appeals processing, we reviewed relevant VA
testimony and key documents, such as VA strategic plans, and
interviewed VA officials responsible for compensation claims and
appeals processing. We focused on VA actions that are ongoing or those
that VA completed after fiscal year 2005. To examine these actions, we
analyzed VBA and Board staffing data; reviewed VA's budget
submissions, internal processing guidance, and other documents such as
external studies and VA's Office of Inspector General reports; and
interviewed VA officials and veteran service organization
representatives. In addition, we visited four VBA regional offices and
the Board to learn about ongoing initiatives. In selecting the
regional offices--Chicago, Illinois; Seattle, Washington; Togus,
Maine; and Winston-Salem, North Carolina--we considered regional
offices that would provide (1) insights about ongoing initiatives,
such as pilots; (2) a mix of offices located in different geographic
settings (e.g., urban and rural); and (3) a mix of offices that are
above and below VBA's averages for select claims processing measures.
We also reviewed relevant federal laws, regulations, and court
decisions.
We conducted this review from November 2008 to January 2010 in
accordance with generally accepted government auditing standards.
Those standards require that we plan and perform the audit to obtain
sufficient, appropriate evidence to provide a reasonable basis for our
findings and conclusions based on our audit objectives. We believe
that the evidence obtained provides a reasonable basis for our
findings and conclusions based on our audit objectives.
Analysis of VA Claims Workload and Performance Data:
To analyze VA disability compensation claim workloads and processing
timeliness, we obtained nationwide, summary-level workload and
performance data by fiscal year from VA's Benefits Delivery Network
and accompanying Distribution of Operational Resources (known as
"DOOR") reports, and Veterans Services Network (VETSNET) system and
accompanying VETSNET Operations Reports (known as "VOR"), and spoke
with VA officials about these data and sources. We limited our
analysis to the following three types of disability claims: (1)
initial compensation claims with fewer than or equal to seven
disabilities, (2) initial compensation claims with eight or more
disabilities, and (3) reopened compensation claims. We analyzed data
for fiscal years 2000 to 2008. To analyze pending claims trends, we
considered the number of claims that were awaiting a decision on the
last day of each fiscal year. To analyze and report other claim
processing trends besides those for receipts--which are designated by
fiscal year according to when VA received the claim--VA designated
claims by fiscal year according to when the decisions occurred. To
verify the reliability of summary-level workload and timeliness data
from these systems, we obtained and analyzed record-level data from VA
and spoke with VA officials about how the data are input.
We were able to replicate all of the summary-level workload and
timeliness data that VA provided. However, we questioned VA's method
for calculating claim receipts. Therefore, we attempted to replicate
claim receipt data using VA's method and our method. VA calculates
monthly claim receipts by counting the total number of pending claim
records at the end of a month; subtracting the number of pending claim
records from the end of the previous month; and adding the number of
completed claims during the month, regardless of when they originated.
To calculate the annual number of claims received, VA then adds the
monthly claim receipt counts. Our method for calculating annual claim
receipts was to count the number of claims whose claim date was in a
given year. We compared the results and found that the annual claim
receipts data using our method were about 2 to 3 percent lower than
the data replicated using VA's method. Ultimately, we decided to use
the summary-level receipts data that VA provided because they were
materially close to our counts and because we were able to replicate
VA's summary-level data using its method.
To analyze the quality of VA's disability compensation claims
processing, we obtained annual, nationwide data from its Systematic
Technical Accuracy Review (STAR) program and verified the reliability
of the data. The STAR program audits a randomly selected sample of
VBA's completed claims for accuracy. We limited our analysis to the
following three types of disability claims: (1) initial compensation
claims with fewer than or equal to seven disabilities, (2) initial
compensation claims with eight or more disabilities, and (3) reopened
compensation claims. To report consistent data, we analyzed fiscal
years 2003 to 2008 because the STAR program changed its audit
methodology in fiscal year 2002. To verify the reliability of STAR
data, we spoke with VA officials responsible for overseeing the STAR
system. We also relied on prior verification of STAR data.[Footnote
44] Consistent with this prior verification, we found that the STAR
data were reliable for reporting nationwide trends.
Analysis of VA Appellate Workload and Performance Data:
To analyze VA's disability compensation appellate workloads and
processing performance, we obtained record-level appeals data
extracted on April 2, 2009, from the Veterans Appeals Control and
Locator System (VACOLS). We limited our analysis to rating-related
disability compensation appeals, which we identified by speaking with
Board officials about how rating-related disability compensation
appeals are classified in VACOLS, then limiting the data accordingly.
We further limited our analysis to original appeals as opposed to
appeals that, for example, had been previously remanded by the Board.
Using the record-level appeals data, we generated nationwide annual
data for fiscal years 2000 to 2008.[Footnote 45] To analyze pending
appeals trends, we considered the number of appeals that were awaiting
a decision on the last day of each fiscal year. To analyze other
appeals processing trends besides those for receipts--which we
designated by fiscal year according to when VA received the appeal--we
designated appeals by fiscal year according to when their resolution
occurred.
Our reporting of avoidable remands--which are appeals that the Board
does not consider because of claims processing errors that occurred
before VBA certified transferring the appeal to the Board--varies from
calculations we received from VBA. For fiscal years 2006 to 2008, we
calculated avoidable remand rates of 24.3 percent, 25.4 percent, and
24.7 percent, respectively; whereas VBA reported avoidable remand
rates of 23.7 percent, 17.9 percent, and 17.7 percent, respectively.
Our analysis was limited to compensation appeals, whereas VBA included
noncompensation-related appeals. In addition, the calculation methods
differed. We calculated the avoidable remand rate as the number of
avoidable remands on original appeals--which excludes appeals that
were previously remanded by the Board--divided by the number of
original appeals decided by the Board. VBA calculated the rate as the
number of avoidable remands on original appeals, divided by the total
number of appeals decided by the Board. We believe that VBA's method
is misleading because appeals in the denominator are not restricted as
they are in the numerator.
To assess the reliability of record-level appeals data, we (1)
interviewed Board officials about program and technical operations and
(2) performed electronic testing to identify missing and potentially
invalid data and to identify internal inconsistencies. We found that
the data were reliable for our reporting purposes.
[End of section]
Appendix II: Comments from the Department of Veterans Affairs:
Department of Veterans Affairs:
Office of the Secretary:
December 29, 2009:
Daniel Bertoni:
Director:
Education, Workforce, and Income Security Issues:
U.S. Government Accountability Office:
441 G Street, NW:
Washington, DC 20548:
Dear Mr. Bertoni:
The Department of Veterans Affairs (VA) has reviewed the Government
Accountability Office's (GAO) draft report, Veterans Disability
Benefits: Further Evaluation of Ongoing Initiatives Could Help
Identify Effective Approaches for Improving Claims Processing (GA0-10-
213) and generally agrees with GAO's conclusions and concurs with
GAO's recommendations to the Department. The enclosure specifically
addresses each of GAO's recommendations.
VA appreciates the opportunity to comment on your draft report.
Sincerely,
Signed by:
John R. Gingrich:
Chief of Staff:
Enclosure:
[End of letter]
Enclosure:
Department of Veterans Affairs (VA) Comments to Government
Accountability Office (GAO) Draft Report: Veterans Disability
Benefits; Further Evaluation of Ongoing Initiatives Could Help
Identify Effective Approaches for Improving Claims Processing
(GA0-10-213):
GAO Recommendations: We recommend that the Secretary for Veterans
Affairs direct:
Recommendation 1: VBA to collect data on redistributed claims for
development, rating, and appellate work to help assess the timeliness
and accuracy of resource centers' output and the effectiveness of
workload distribution.
VA Response: Concur. VBA's Systematic Technical Accuracy Review staff
began collecting accuracy data on redistributed rating work in April
2009. Additionally, VBA uses the VETSNET Operations Reports (VOR) as a
primary tool for workload management. VBA is making changes to VOR to
allow for improved tracking of brokered (redistributed) claims. VBA
expects these changes to be available in VOR in March 2010. When these
changes are made, VBA will have data to assess the timeliness of
redistributed rating, development, and appellate work. VBA will then
be able to conduct additional analyses regarding the effectiveness of
workload redistribution. Target Completion Date: March 2010.
Recommendation 2: VBA and the Board to establish an evaluation plan
for assessing the Expedited Claims Adjudication (ECA) pilot process
and guiding any expansion decisions. Such a plan should include
criteria for determining how much improvement should be achieved under
the pilot on specific performance measures”such as average VBA and
Board processing times”and methods for how VBA and the Board will
consider ECA's impact on non-ECA claims and appeals processing before
implementing the process widely.
VA Response: Concur. The Board will initiate a meeting with VBA in
early 2010 to finalize a plan to evaluate the relative timeliness of
ECA claims and appeals processing. The specific criteria for the
success or failure of the pilot will be addressed at the initial
evaluation meeting. The Board will work with VBA to establish
evaluation criteria, actions, and responsibilities, and also to
explore ECA's impact on non-ECA claims and appeals processing, if any.
In identifying specific benchmarks for success, special attention will
be paid to weighing the processing time saved for claimants with any
potential administrative burdens on VA. Based on data obtained from
the evaluation, the Board will make recommendations to the Secretary
regarding the potential expansion of the pilot, or to permanently
incorporate successful aspects of the pilot. The Board's goal is to
have a formal evaluation complete, and recommendations to the
Secretary, before the conclusion of fiscal year 2010.
Recommendation 3: VBA to establish a plan to evaluate its claims
processing reorganization pilot and guide any expansion decisions.
Such a plan should include criteria for determining how much
improvement should be achieved in the pilot on specific performance
measures”such as decision timeliness and accuracy”before the process
is implemented throughout VBA.
VA Response: Concur. The VBA Compensation Claims Pilot in Little Rock,
Arkansas began in July 2009, and is scheduled to run through May 2010.
Using Lean Six Sigma principles and organizational behavioral changes,
VBA is working with a private consulting firm to reengineer the paper-
based claims process. As part of the contract, the private consulting
firm will report periodically on mutually agreed upon critical success
factors, which were determined at the beginning of the pilot
(Attachment A). In addition, VBA will receive a final report at the
completion of the pilot, which will include an evaluation of the
pilot, with clearly defined criteria to assess the pilot. This
information will educate decisions for further implementation. In the
meantime, periodic updates on the pilot are provided to VBA leadership
so that gains achieved through the pilot can be exported to other
regional offices.
[End of section]
Appendix III: GAO Contact and Staff Acknowledgments:
GAO Contact:
Daniel Bertoni, (202) 512-7215 or bertonid@gao.gov:
Staff Acknowledgments:
Shelia Drake, Assistant Director; Joel Green; Lisa McMillen; and Bryan
Rogowski made significant contributions to this report. In addition,
Walter Vance provided guidance on research methodology; Cynthia Grant
and Christine San provided assistance with data analysis; Roger Thomas
provided legal counsel; Jessica Orr helped with report preparation;
and James Bennett provided assistance with graphics.
[End of section]
Related GAO Products:
Veterans' Disability Benefits: Preliminary Findings on Claims
Processing Trends and Improvement Efforts. [hyperlink,
http://www.gao.gov/products/GAO-09-910T]. Washington, D.C.: July 29,
2009.
Military Disability System: Increased Supports for Servicemembers and
Better Pilot Planning Could Improve the Disability Evaluation Process.
[hyperlink, http://www.gao.gov/products/GAO-08-1137]. Washington,
D.C.: September 24, 2008.
Veterans' Benefits: Increased Focus on Evaluation and Accountability
Would Enhance Training and Performance Management for Claims
Processors. [hyperlink, http://www.gao.gov/products/GAO-08-561].
Washington, D.C.: May 27, 2008.
Veterans Benefits Administration: Progress Made in Long-Term Effort to
Replace Benefits Payment System, but Challenges Persist. [hyperlink,
http://www.gao.gov/products/GAO-07-614]. Washington, D.C.: April 27,
2007.
Veterans' Disability Benefits: VA Can Improve Its Procedures for
Obtaining Military Service Records. [hyperlink,
http://www.gao.gov/products/GAO-07-98]. Washington, D.C.: December 12,
2006.
Veterans' Benefits: Further Changes in VBA's Field Office Structure
Could Help Improve Disability Claims Processing. [hyperlink,
http://www.gao.gov/products/GAO-06-149]. Washington, D.C.: December 9,
2005.
Veterans' Disability Benefits: Claims Processing Challenges and
Opportunities for Improvements. [hyperlink,
http://www.gao.gov/products/GAO-06-283T]. Washington, D.C.: December
7, 2005.
VA Disability Benefits: Board of Veterans' Appeals Has Made
Improvements in Quality Assurance, but Challenges Remain for VA in
Assuring Consistency. [hyperlink,
http://www.gao.gov/products/GAO-05-655T]. Washington, D.C.: May 5,
2005.
Veterans' Benefits: More Transparency Needed to Improve Oversight of
VBA's Compensation and Pension Staffing Levels. [hyperlink,
http://www.gao.gov/products/GAO-05-47]. Washington, D.C.: November 15,
2004.
Veterans' Benefits: Improvements Needed in the Reporting and Use of
Data on the Accuracy of Disability Claims Decisions. [hyperlink,
http://www.gao.gov/products/GAO-03-1045]. Washington, D.C.: September
30, 2003.
High-Risk Series: An Update. [hyperlink,
http://www.gao.gov/products/AO-03-119]. Washington, D.C.: January 2003.
Veterans' Benefits: Claims Processing Timeliness Performance Measures
Could Be Improved. [hyperlink,
http://www.gao.gov/products/GAO-03-282]. Washington, D.C.: December
19, 2002.
Veterans' Benefits: Quality Assurance for Disability Claims and
Appeals Processing Can Be Further Improved. [hyperlink,
http://www.gao.gov/products/GAO-02-806]. Washington, D.C.: August 16,
2002.
Veterans' Benefits: VBA's Efforts to Implement the Veterans Claims
Assistance Act Need Further Monitoring. [hyperlink,
http://www.gao.gov/products/GAO-02-412]. Washington, D.C.: July 1,
2002.
Veterans Benefits Administration: Problems and Challenges Facing
Disability Claims Processing. [hyperlink,
http://www.gao.gov/products/GAO/T-HEHS/AIMD-00-146]. Washington, D.C.:
May 18, 2000.
[End of section]
Footnotes:
[1] VA's ratings are in 10 percent increments, from 0 to 100 percent.
Generally, VA does not pay disability compensation for disabilities
rated at 0 percent. As of November 2009, basic monthly payments ranged
from $123 for 10 percent disability to $2,673 for 100 percent
disability.
[2] Additional compensation is available to qualifying dependents of
veterans whose disability is rated 30 percent or higher as provided by
38 U.S.C. § 1115.
[3] VA also pays pensions to surviving spouses and unmarried children
of deceased wartime veterans. In addition, VA pays dependency and
indemnity compensation to some deceased veterans' spouses, children,
and parents.
[4] These representatives are known as "veteran service
representatives," or "VSRs."
[5] These specialists are known as "rating veteran service
representatives," or "RVSRs."
[6] This strategic goal includes compensation-and pension-related
appeals.
[7] These strategic goals are based on compensation-and pension-
related decisions.
[8] These data exclude appellate work. The reported compensation
claims data are comprised of the following three VBA categories:
initial compensation claims with eight or more disabling conditions;
initial compensation claims with seven or fewer disabling conditions;
and reopened compensation claims, whereby a veteran submits a claim
for additional benefits anytime after submitting the initial claim
(e.g., if a new service-connected disability arises or a previously
claimed disability worsens).
[9] The average days pending is the average time that pending claims
have been awaiting a decision at a point in time. VA calculates the
average days pending for a fiscal year on the last day of the year.
The average days to complete a claim is the average processing time of
decisions reached during a specific period.
[10] VA's fiscal year 2008 average days pending goal for compensation
claims was 120 days. VA does not have a comparable goal for average
days to complete compensation claims. However, VA's fiscal year 2008
goal for average days to complete rating-related claims, including
both compensation and pension claims, was 169 days.
[11] VA changed how it calculates claims processing accuracy in fiscal
year 2002. Therefore, to analyze and report consistent data, we
considered accuracy data for compensation claims starting in fiscal
year 2003.
[12] See, for example, Haas v. Nicholson, 20 Vet. App. 257 (2006). The
Agent Orange Act of 1991, Pub. L. No. 102-4, broadens the presumption
of exposure to herbicides in Vietnam. See also, 38 C.F.R. § 3.309
(diseases subject to a presumptive service connection).
[13] The other conditions are B cell leukemias and ischemic heart
disease.
[14] 38 C.F.R. § 4.124a (73 Fed. Reg. 54693, Sept. 23, 2008).
[15] Veterans Benefits Improvement Act of 2008, Pub. L. No. 110-389;
Veterans Benefits Improvement Act of 2004, Pub. L. No.108-454;
Veterans Benefits Act of 2003, Pub. L. No. 108-183; and Veterans
Claims Assistance Act of 2000, Pub. L. No. 106-475.
[16] See, for example, Haas v. Nicholson, 20 Vet. App. 257 (2006);
Moody v. Principi, 360 F.3d 1306 (Fed. Cir. 2004); Szemraj v.
Principi, 357 F.3d 1370 (Fed. Cir. 2004); and Disabled American
Veterans v. Secretary of Veterans Affairs, 327 F.3d 1339 (Fed. Cir.
2003).
[17] Pub. L. No. 104-475.
[18] We analyzed rating-related compensation appeals to the Board from
VA's appeals database.
[19] VBA includes appellate work in its accuracy assessments. However,
because appellate work comprises a relatively small portion of the
decisions assessed, we cannot reliably identify accuracy rates for
appellate work from these assessments.
[20] VA categorizes remands as "avoidable" when the reason for the
remand occurred before VBA certified transferring the appeal to the
Board.
[21] We analyzed avoidable remand data from fiscal years 2006 to 2008
because complete, reliable data were previously not available in VA's
appeals database. See appendix I for information about avoidable
remand calculations.
[22] This average is based on appeals that VBA certified as being
ready for the Board. All appeals do not reach this stage because
appellants may resolve their appeals beforehand.
[23] Ebert v. Brown, 4 Vet. App. 434 (1993).
[24] Vazquez-Flores v. Peake, 22 Vet. App. 37 (2008), vacated Vazquez-
Flores v. Shinseki, 580 F.3d 1270 (Fed. Cir. 2009).
[25] See footnote 24.
[26] These and other data in this paragraph are based on full-time-
equivalent staffing.
[27] Pub. L. No. 111-5.
[28] GAO, Veterans' Disability Benefits: Claims Processing Challenges
Persist, while VA Continues to Take Steps to Address Them, [hyperlink,
http://www.gao.gov/products/GAO-08-473T] (Washington, D.C.: Feb. 14,
2008).
[29] As required under section 225 of the Veterans' Benefits
Improvement Act of 2008 (Pub. L. No. 110-389), GAO is in the process
of evaluating VA's training programs for claims processors. This
evaluation builds on prior work in which we found that increased focus
on evaluation and accountability would enhance training and
performance management for claims processors. See GAO, Veterans'
Benefits: Increased Focus on Evaluation and Accountability Would
Enhance Training and Performance Management for Claims Processors,
[hyperlink, http://www.gao.gov/products/GAO-08-561] (Washington, D.C.:
May 27, 2008).
[30] VA also redistributes workloads from backlogged regional offices
to regional offices without resource centers but with more capacity to
handle such workloads. VA refers to moving workloads--to either a
resource center or another regional office--for processing as
"brokering."
[31] VBA determines the number of claims redistributed to rating and
appeal resource centers on a monthly basis, and it determines the
number of claims redistributed to development resource centers on a
quarterly basis.
[32] The military's disability evaluation system involves determining
whether a servicemember "is unable to reasonably perform the duties of
his or her office, grade, rank, or rating," taking into consideration
the requirements of a servicemember's current specialty.
[33] In September 2008, we reported that while DOD and VA had
established measures for the disability evaluation system pilot's
performance and a mechanism for tracking performances, they had not
established criteria for determining whether the pilot was successful
and should be expanded on a large scale. See GAO, Military Disability
System: Increased Supports for Servicemembers and Better Pilot
Planning Could Improve the Disability Evaluation Process, [hyperlink,
http://www.gao.gov/products/GAO-08-1137] (Washington, D.C.: Sept. 24,
2008).
[34] DOD conducts fewer disability evaluations than VA, in part,
because there are fewer servicemembers than veterans. Currently, there
are about 10 times more veterans than servicemembers. In addition, DOD
only conducts disability evaluations for referred servicemembers whose
medical conditions may prevent them from performing their military
duties. VA conducts disability evaluations for veterans as claimed
conditions arise or worsen.
[35] Participating claimants may submit information after the
abbreviated response periods, but in doing so their participation in
ECA is canceled. VA would then process their claims or appeals using
its normal procedures.
[36] Pub. L. No. 110-389.
[37] Fully developed claims are claims that do not require additional
development by or assistance from VA other than scheduling a VA
examination or obtaining records held by the federal government.
[38] As with ECA, participating claimants may subsequently submit
additional information; however, in doing so, their participation in
the pilot is canceled. VA would then process their claims or appeals
using its normal procedures.
[39] Booz Allen Hamilton, Veterans Benefits Administration
Compensation and Pension Claims Development Cycle Study, a report
prepared for the Department of Veterans Affairs, Veterans Benefits
Administration (June 5, 2009).
[40] Department of Veterans Affairs, Office of Inspector General,
Audit of Veterans Benefits Administration Compensation Rating Accuracy
and Consistency Reviews (Washington, D.C.: Mar. 12, 2009).
[41] GAO, Veterans' Benefits: Quality Assurance for Disability Claims
and Appeals Processing Can Be Further Improved, [hyperlink,
http://www.gao.gov/products/GAO-02-806] (Washington, D.C.: Aug. 16,
2002).
[42] VA calls these tests "inter-rater reliability" studies.
[43] In fiscal year 2009, VA received and began processing about
25,000 Benefits Delivery at Discharge claims.
[44] GAO, Veterans' Benefits: Further Changes in VBA's Field Office
Structure Could Help Improve Disability Claims Processing, [hyperlink,
http://www.gao.gov/products/GAO-06-149] (Washington, D.C.: Dec. 9,
2005).
[45] We analyzed avoidable remand data from fiscal years 2006 to 2008
because complete, reliable data were previously not available in
VACOLS.
[End of section]
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