oversight

Veterans' Disability Benefits: Timely Processing Remains a Daunting Challenge

Published by the Government Accountability Office on 2012-12-21.

Below is a raw (and likely hideous) rendition of the original report. (PDF)

                United States Government Accountability Office

GAO             Report to Congressional Requesters




                VETERANS’
December 2012



                DISABILITY
                BENEFITS

                Timely Processing
                Remains a Daunting
                Challenge




GAO-13-89
                                              December2012

                                              VETERANS’ DISABILITY BENEFITS
                                              Timely Processing Remains a Daunting Challenge

Highlights of GAO-13-89, a report to
congressional requesters




Why GAO Did This Study                        What GAO Found
For years, VA has struggled with an           A number of factors—both external and internal to the Veterans Benefits
increasing workload of disability             Administration (VBA)—have contributed to the increase in processing timeframes
compensation claims. The average              and subsequent growth in the backlog of veterans’ disability compensation
time to complete a claim was 188 days         claims. As the population of new veterans has swelled in recent years, the
in fiscal year 2011, and VA expects an        annual number of claims received by VBA has gone up. Compared to the past,
increase in claims received as 1 million      these claims have a higher number of disabling conditions, and some of these
servicemembers leave military service         conditions, such as traumatic brain injuries, make their assessment complex.
over the next 5 years. As GAO and             Moreover, due to new regulations that have established eligibility for benefits for
other organizations have previously           new diseases associated with Agent Orange exposure, VBA adjudicated 260,000
reported, VA has faced challenges in          previously denied and new claims. Beyond these external factors, issues with the
reducing the time it takes to decide          design and implementation of the compensation program have contributed to
veterans’ claims. GAO was asked to            timeliness challenges. For example, the law requires the Department of Veterans
review these issues. Specifically, this       Affairs (VA) to assist veterans in obtaining records that support their claim.
report examines (1) the factors that
                                              However, VBA officials said that lengthy timeframes in obtaining military
contribute to lengthy processing times
                                              records—particularly for members of the National Guard and Reserve—and
for disability claims and appeals, and
(2) the status of VBA’s recent efforts to
                                              Social Security Administration (SSA) medical records impact VA’s duty to assist,
improve disability claims and appeals         possibly delaying a decision on a veteran’s disability claim. As a result, the
processing timeliness. To do this, GAO        evidence gathering phase of the claims process took an average of 157 days in
analyzed VBA performance data and             2011. Further, VBA’s paper-based claims processing system involves multiple
program documents, reviewed relevant          hand-offs, which can lead to misplaced and lost documents and can cause
studies and evaluations, met with staff       unnecessary time delays. Concerning timeliness of appeals, VBA regional offices
from five VA regional offices, and            have shifted resources away from appeals and toward claims in recent years,
interviewed VBA officials and Veterans        which has led to lengthy appeals timeframes.
Service Organizations.
                                              VBA is currently taking steps to improve the timeliness of claims and appeals
What GAO Recommends                           processing; however, prospects for improvement remain uncertain because
GAO recommends that VBA (1)                   timely processing remains a daunting challenge. VBA is using contractors to
partner with military officials to reduce     handle some aspects of the claims process, and is also shifting some workload
timeframes to gather records from             between regional offices. Also, VBA is modifying and streamlining certain claims
National Guard and Reserve sources,           and appeals processing procedures for veterans who opt to participate in these
(2) partner with SSA to reduce                initiatives in exchange for an expedited decision. For example, veterans receive
timeframes to gather SSA medical              expedited processing when they submit a claim that is certified as having all
records, and (3) ensure the                   required evidence. Not many veterans have elected this option, but VA is making
development of a robust plan for its          adjustments to increase its attractiveness. In addition, VBA is trying to decrease
initiatives that identifies performance       the amount of time it takes to gather medical evidence. For example, VBA
goals that include the impact of              recently encouraged medical providers to use a standardized form when
individual initiatives on processing          responding to VBA’s request for information. However, results of this initiative
timeliness. In response to a draft of this    have been mixed. VBA is also taking steps to streamline the claims process,
report, VA officials generally agreed         including implementing initiatives to create (1) standardized language for
with GAO’s conclusions and concurred          decision letters sent to veterans, (2) specialized teams that process claims based
with the recommendations, and                 on level of complexity, and (3) a paperless claims system. According to VBA
summarized efforts that are planned or        officials, these efforts will help VA process veterans’ claims within 125 days by
underway to address the                       2015. However, the extent to which VA is positioned to meet this ambitious goal
recommendations.
                                              remains uncertain. Specifically, VBA’s backlog reduction plan—its key planning
                                              document—does not articulate performance measures for each initiative,
View GAO-13-89. For more information,         including their intended impact on the claims backlog. Furthermore, VA has not
contact Daniel Bertoni at (202) 512-7215 or
bertonid@gao.gov                              yet reported on how these efforts have affected processing times, a condition
                                              which raises concern given the mixed results that have emerged to date.
                                                                                      United States Government Accountability Office
Contents


Letter                                                                                              1
                       Background                                                                    4
                       Rising Workloads, along with Program Rules and Inefficient
                         Processes, Contribute to Lengthy Processing Time Frames                     9
                       VBA Is Taking Steps to Improve Claims and Appeals Processing,
                         but Future Impact Is Uncertain                                            21
                       Conclusions                                                                 29
                       Recommendations for Executive Action                                        29
                       Agency Comments and Our Evaluation                                          30

Appendix I             Objectives, Scope, and Methodology                                          35



Appendix II            Veteran Notification during the Claims and Appeals Processes 39



Appendix III           Selected VBA Efforts to Improve Claims and Appeals
                       Timeliness                                                                  43


Appendix IV            Comments from the Department of Veterans Affairs                            46



Appendix V             GAO Contact and Staff Acknowledgments                                       51



Related GAO Products                                                                              52



Table
                       Table 1: Selected VBA Efforts to Improve Claims and Appeals
                                Timeliness                                                         43


Figures
                       Figure 1: Selected VA Regional Offices That GAO Reviewed                      3
                       Figure 2: Overview of VA’s Disability Claims Process                          5



                       Page i                               GAO-13-89 VA Disability Benefits Processing
Figure 3: Average Days VA Compensation Rating Claims Were
         Pending and Average Days It Took to Complete Claims,
         Fiscal Year 2009 to August 2012                                      7
Figure 4: Timeliness of Phases in VA’s Claims Process for Fiscal
         Year 2011                                                            8
Figure 5: VA Timeliness Measures of Notices of Disagreement and
         Appeals Certification, Fiscal Year 2009 to August 2012               8
Figure 6: VA Compensation Rating Claims Received, Completed,
         and Backlogged, Fiscal Years 2009 to 2011                          10
Figure 7: Notices of Disagreement Received by VA and Awaiting a
         Decision, Fiscal Years 2009 to 2012                                11
Figure 8: Selected VBA Improvement Efforts                                  22
Figure 9: VBA Notifications to Veterans throughout the Claims
         Process                                                            39
Figure 10: VBA Notifications to Veterans throughout the Appeals
         Process                                                            41




Page ii                              GAO-13-89 VA Disability Benefits Processing
Abbreviations

ACE               Acceptable Clinical Evidence
Board             Board of Veterans’ Appeals
DBQ               Disability Benefits Questionnaire
DOD               Department of Defense
DRO               Decision Review Officer
FDC               Fully Developed Claim
FTE               full-time equivalent
IRIS              Inquiry Routing and Information System
MAP-D             Modern Award Processing-Development
MSA               Metropolitan Statistical Area
OIG               Office of Inspector General
QRT               Quality Review Team
RVSR              Rating Veterans Service Representative
SNL               Simplified Notification Letter
SOC               Statement of the Case
SSA               Social Security Administration
SSOC              Supplemental Statement of the Case
VA                Department of Veterans Affairs
VACOLS            Veterans Appeals Control and Locator System
VBA               Veterans Benefits Administration
VBMAP             Veterans Benefits Management Assistance Program
VBMS              Veterans Benefits Management System
VCAA              Veterans Claims Assistance Act of 2000
VETSNET           Veterans Services Network
VHA               Veterans Health Administration
VONAPP            Veterans On Line Application
VOR               VETSNET Operations Reports
VSO               Veterans Service Organization
VSR               Veterans Service Representative




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Page iii                                       GAO-13-89 VA Disability Benefits Processing
United States Government Accountability Office
Washington, DC 20548




                                   December 21, 2012

                                   Congressional Requesters

                                   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 2011, the
                                   program provided $39.4 billion in benefits to 3.35 million veterans. For
                                   years, the disability compensation claims process has been the subject of
                                   concern and attention by VA, Congress, and Veterans Service
                                   Organizations (VSO), due in large part to long waits for decisions and the
                                   large number of claims pending a decision. Moreover, VA’s backlog of
                                   claims—defined as claims awaiting a decision for over 125 days—has
                                   more than tripled since September 2009. Against this backdrop, 1 million
                                   servicemembers are expected to become veterans in the next 5 years
                                   according to VA officials, with a significant number expected to apply for
                                   disability benefits. As we and other organizations have reported over the
                                   last decade, VA has faced challenges in reducing the time it takes to
                                   decide veterans’ claims. For example, the average length of time to
                                   complete a claim has increased from 161 days in 2009 to 260 days in
                                   2012. 1 Moreover, in August 2012, 568,043 claims—approximately two-
                                   thirds of all compensation rating claims—were backlogged. 2 In addition,
                                   timeliness of appeals processing at VA regional offices has also slowed
                                   by 56 percent over the last several years. The Veterans Benefits
                                   Administration (VBA) has a number of ongoing initiatives in place to help
                                   meet its stated timeliness goals. In this context, we were asked to
                                   examine issues VA regional offices face in processing disability claims
                                   and appeals in a timely fashion. Specifically, we addressed the following
                                   questions:

                                       1. What factors contribute to lengthy processing times for disability
                                          claims and appeals?


                                   1
                                     From the beginning of fiscal year 2012 through August 2012, which was the most recent
                                   data available at the time of publishing, the average number of days it took VA to
                                   complete a claim was 260 days.
                                   2
                                     Compensation rating claims include pension rating and disability compensation rating
                                   claims. Workload and timeliness data provided to us by VBA include all compensation
                                   rating claims. Furthermore, VBA does not report out on disability rating compensation
                                   claims separately.




                                   Page 1                                        GAO-13-89 VA Disability Benefits Processing
    2. What is the status of VBA’s recent efforts to improve disability
       claims and appeals processing timeliness?

To address our objectives, we collected and analyzed information through
multiple methods. We reviewed relevant federal laws and regulations,
court decisions, VBA policy manuals and documents, and training
materials. We also reviewed past GAO and VA Office of Inspector
General (OIG) reports, VBA studies and evaluations, and other
documents relevant to claims and appeals processing at VBA regional
offices. We collected data on claims and appeals processing workload
and timeliness from VBA’s internal dashboard. 3 To assess the reliability of
the data, we conducted interviews with VBA officials in charge of
maintaining VBA’s internal dashboard about their quality control
procedures and practices used to extract timeliness and workload data
from underlying data sources. We relied on past GAO data reliability
assessments of the underlying data sources where enterprise-wide data
on workload and timeliness of claims and appeals processing is stored
and extracted into the internal dashboard tool. In addition, we collected
data on claims processing resources from VBA’s Personnel and
Accounting Integrated Database. To assess the reliability of these data,
we interviewed officials in VBA’s Office of Human Resources about
practices to record personnel actions, quality control procedures
conducted within the Office of Human Resources to ensure the quality of
the data, as well as potential limitations to the data. We reviewed the data
and found it to be sufficiently reliable for the purpose of analyzing
timeliness, workload, and resources assigned to claims processing. We
interviewed VBA central office officials, including officials in VBA’s
Implementation Center (which was established as a project management
office to manage improvement initiatives), and VSO representatives who
assist veterans with their claims and appeals. We also met with staff from
five VA regional offices—Atlanta, Georgia; Houston, Texas; Los Angeles,
California; New York, New York; and Philadelphia, Pennsylvania. We
selected offices based on size of metropolitan area, claims workload, and
timeliness of claims and appeals processing. For each location, we
interviewed regional office management and staff, analyzed workload
management documents, and reviewed written notifications sent to




3
 VBA’s internal dashboard is a data report that aggregates key metrics that are used to
assess performance from a variety of data sources into one integrated tool.




Page 2                                        GAO-13-89 VA Disability Benefits Processing
                                       veterans (see fig. 1). For additional information on our scope and
                                       methodology, see appendix I.

Figure 1: Selected VA Regional Offices That GAO Reviewed




                                       Note: MSA rank refers to the rank order of the population of all Metropolitan Statistical Area (MSA)
                                       across the nation, according to the 2010 Census. An MSA is a geographic entity defined by the U.S.
                                       Office of Management and Budget for use by federal statistical agencies, based on the concept of a
                                       core area with a large population nucleus, plus adjacent communities having a high degree of
                                       economic and social integration with that core.


                                       We conducted this performance audit from March 2012 through
                                       December 2012 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.




                                       Page 3                                              GAO-13-89 VA Disability Benefits Processing
Background
Disability Claims Process   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. 4
                            VA also pays additional compensation for certain dependent spouses,
                            children, and parents of veterans. 5 VA’s disability compensation claims
                            process starts when a veteran submits a claim to VBA (see fig. 2). A
                            claim folder is created at 1 of VA’s 57 regional offices, and a Veterans
                            Service Representative (VSR) then reviews the claim and helps the
                            veteran gather the relevant evidence needed to evaluate the claim. Such
                            evidence includes the veteran’s military service records, medical
                            examinations, and treatment records from Veterans Health Administration
                            (VHA) medical facilities and private medical service providers. Also, if
                            necessary to provide support to substantiate the claim, VA will provide a
                            medical examination for the veteran. Once VBA has gathered the
                            supporting evidence, a Rating Veterans Service Representative
                            (RVSR)—who typically has more experience at VBA than a VSR—
                            evaluates the claim and determines whether the veteran is eligible for
                            benefits. If so, the RVSR assigns a percentage rating. Later, the veteran
                            can reopen a claim to request an increase in disability compensation from
                            VA if, for example, a service-connected disability has worsened or a new
                            disability arises.




                            4
                              38 U.S.C. §§ 1110, 1155. VA’s ratings are awarded in 10 percent increments, from 0 to
                            100 percent. Generally, VA does not pay disability compensation for disabilities rated at 0
                            percent. As of December 2011, basic monthly payments ranged from $127 for a veteran
                            with 10 percent disability and no dependents to $ 3,285 for a veteran with 100 percent
                            disability and dependents.
                            5
                                38 U.S.C. § 1115.




                            Page 4                                         GAO-13-89 VA Disability Benefits Processing
Figure 2: Overview of VA’s Disability Claims Process




                                         Note: The Veterans Claims Assistance Act of 2000 (VCAA) requires VA to notify veterans of the
                                         information necessary to evaluate a claim. If the veteran does not respond to this notice within 30
                                         days, VA may make a decision on the claim based on the information and evidence in the file at that
                                         time.



Appeals Process                          If the veteran disagrees with VA’s decision regarding a claim, he or she
                                         can submit a written Notice of Disagreement to the regional office
                                         handling the claim. 6 In response to such a notice, VBA reviews the case
                                         and provides the veteran with a written explanation of the decision if VBA
                                         does not grant all appealed issues. 7 Appendix II contains more
                                         information regarding VBA’s notifications to veterans throughout the
                                         disability compensation claims and appeals processes. If additional
                                         evidence is provided, VBA reviews the case again and if this new
                                         evidence does not result in a grant of all appealed issues, VBA produces
                                         another written explanation of the decision. If the veteran further
                                         disagrees with the decision, he or she may appeal to the Board of
                                         Veterans’ Appeals (the Board). Before transferring the appeal to the
                                         Board, VBA reviews the case again and then certifies that the appeal is
                                         ready for review by the Board. After the appeal has been certified, the
                                         Board conducts a hearing if the veteran requests one, then grants


                                         6
                                          38 U.S.C. § 7105. A Notice of Disagreement is a written communication that a claimant
                                         uses to express disagreement with a decision.
                                         7
                                           If VBA grants some, but not all, of the issues in an appeal or if the grant is less than the
                                         maximum allowable benefit for the issues under appeal, VBA must send a written
                                         explanation of the reasons for the decision. VBA is also obligated to send a letter
                                         explaining the decision in cases where the veteran’s appeal includes a request to be rated
                                         at a specific percentage, but VBA has decided to grant the appeal at less than that
                                         requested percentage.




                                         Page 5                                              GAO-13-89 VA Disability Benefits Processing
                           benefits, denies the appeal, or returns the case to VBA to obtain
                           additional evidence necessary to decide the claim. If the veteran is
                           dissatisfied with the Board’s decision, he or she may appeal, in
                           succession, to the U.S. Court of Appeals for Veterans Claims, to the
                           Court of Appeals for the Federal Circuit, and finally to the Supreme Court
                           of the United States. 8


VA’s Duty to Assist        Congress clarified VA’s duties with regard to assisting in the development
Requirements               of claims in the Veterans Claims Assistance Act of 2000 (VCAA). 9 VCAA
                           eliminated the requirement that a veteran submit a “well-grounded” claim
                           before VA could assist in developing the claim and instead obligated the
                           agency to assist a claimant in obtaining evidence that is necessary to
                           establish eligibility for the benefit being sought. Specifically, VA must: (1)
                           notify claimants of the information necessary to complete the
                           application; 10 (2) indicate what information not previously provided is
                           needed to substantiate the claim; 11 (3) make reasonable efforts to assist
                           claimants in obtaining evidence to substantiate claimants’ eligibility for
                           benefits, including relevant records; 12 and (4) notify claimants when VA is
                           unable to obtain relevant records. 13 According to VA regulations, VA
                           efforts to obtain federal records should continue until the records are
                           obtained or until VA has deemed it reasonably certain that such records
                           do not exist or that further efforts to obtain those records would be futile. 14


Timeliness of Claims and   Timeliness of VA compensation rating claims and appeals processing has
Appeals Processing         worsened in recent years. As a key indicator of VBA’s performance in
                           claims and appeals processing, timeliness is measured in various ways.
                           To measure overall claims processing timeliness, VBA uses two


                           8
                               38 U.S.C. §§ 7252 and 7292.
                           9
                             Pub. L. No. 106-475, 114 Stat. 2096, amending various provisions of Chapter 51 of title
                           38, U.S. Code.
                           10
                                38 U.S.C. § 5102(b).
                           11
                                38 U.S.C. § 5103(a).
                           12
                                38 U.S.C. §§ 5103A(a)(1) and 5103A(b)(1).
                           13
                                38 U.S.C. § 5103A(b)(2).
                           14
                                38 C.F.R. § 3.159(c)(2).




                           Page 6                                           GAO-13-89 VA Disability Benefits Processing
measures: (1) the number of days the average pending claim has been
awaiting a decision (Average Days Pending) and (2) the average number
of days that VBA took to complete a claim where a decision has been
reached (Average Days to Complete). Both measures of claims
processing timeliness have worsened substantially over the last several
years (see fig.3). 15

Figure 3: Average Days VA Compensation Rating Claims Were Pending and
Average Days It Took to Complete Claims, Fiscal Year 2009 to August 2012




VBA also collects data on the timeliness of the different phases of the
claims process, which is used to identify trends and bottlenecks
throughout the process. In fiscal year 2011, each phase took longer on
average than its stated agency timeliness target (see fig. 4). The
evidence gathering phase is the most time-intensive phase, taking over 5
months (157 days) on average in fiscal year 2011 and continuing to grow
throughout fiscal year 2012.


15
  VBA calculates the Average Days Pending for a fiscal year on the last day of the year
and for the month on the last day of every month. The Average Days to Complete
measures the average processing time for claims completed within a given time period.




Page 7                                        GAO-13-89 VA Disability Benefits Processing
Figure 4: Timeliness of Phases in VA’s Claims Process for Fiscal Year 2011




                                         Note: While VBA’s stated goals are to process all claims within 125 days by fiscal year 2015, VBA
                                         established targets for each phase in the claims process for fiscal year 2011 that collectively add up
                                         to 132 days.


                                         The timeliness of appeals processing at VA regional offices has worsened
                                         as well. The average timeframes in VBA’s response to Notices of
                                         Disagreement and the certification of appeals to the Board have
                                         increased since fiscal year 2009 (see fig. 5).

                                         Figure 5: VA Timeliness Measures of Notices of Disagreement and Appeals
                                         Certification, Fiscal Year 2009 to August 2012




                                         Page 8                                               GAO-13-89 VA Disability Benefits Processing
Rising Workloads,
along with Program
Rules and Inefficient
Processes, Contribute
to Lengthy Processing
Time Frames

Rise in Claims Submitted   In recent years, VA’s claims processing production has not kept pace with
Is Outpacing Claims        the increase in incoming claims. In fiscal year 2011, VA completed over 1
Production                 million compensation rating claims, a 6 percent increase from 2009.
                           However, the number of VA compensation rating claims received has
                           grown 29 percent—from 1,013,712 in fiscal year 2009 to 1,311,091 in
                           fiscal year 2011 (see fig. 6). As a result, the number of backlogged
                           claims—defined as those claims awaiting a decision for more than 125
                           days—has increased substantially since 2009. As of August 2012, VA
                           had 856,092 pending compensation rating claims, of which 568,043 (66
                           percent) were considered backlogged.




                           Page 9                               GAO-13-89 VA Disability Benefits Processing
Figure 6: VA Compensation Rating Claims Received, Completed, and Backlogged,
Fiscal Years 2009 to 2011




Similar to claims processing, VA regional office appeals processing has
not kept pace with incoming appeals received. The number of Notices of
Disagreement—the first step in the appeals process when the veteran
provides a written communication to VBA that he or she wants to contest
the claims decision—received by VBA fluctuated over the last 4 years, yet
those awaiting a decision grew 76 percent over that time period (see fig.
7). Moreover, the number of Statements of the Case—an explanation of
VBA’s decision on the appellant’s case—that were mailed by VBA
decreased 24 percent over the last 4 years—from 100,291 in 2009 to
76,685 in 2012. In addition, the time it took to mail a Statement of the
Case increased 57 percent over that time period—from 293 days to 460
days on average.




Page 10                                 GAO-13-89 VA Disability Benefits Processing
Figure 7: Notices of Disagreement Received by VA and Awaiting a Decision, Fiscal
Years 2009 to 2012




A number of factors have contributed to the substantial increase in claims
received. One factor was the commencement in October 2010 of VBA’s
adjudication of 260,000 previously denied and new claims when a
presumptive service connection was established for three additional




Page 11                                   GAO-13-89 VA Disability Benefits Processing
Agent Orange-related diseases. 16 VBA gave these claims a high priority
and assigned experienced claims staff to process and track them. VBA
officials said that 37 percent of its claims processing resources nationally
were devoted to adjudicating Agent Orange claims from October 2010 to
March 2012. VBA officials in one regional office we spoke to said that all
claims processing staff were assigned solely to developing and rating
Agent Orange claims for 4 months in 2011, and that no other new and
pending claims in the regional office’s inventory were processed during
that time. Also during this time period, special VBA teams—known as
brokering centers—which previously accepted claims and appeals from
regional offices experiencing processing delays, were devoted to
processing Agent Orange claims exclusively. According to VBA, other
factors that contributed to the growing number of claims include an
increase in the number of veterans from the military downsizing after 10
years of conflict in Iraq and Afghanistan, improved outreach activities and
transition services to servicemembers and veterans, and difficult financial
conditions for veterans during the economic downturn. In conjunction with
an increase in claims received, VBA officials said that claims today are
more complex than in the past. As we reported in 2010, VBA said it is
receiving more claims for complex disabilities related to combat and
deployments overseas, including those based on environmental and




16
   VBA was required to adjudicate these claims as a result of requirements related to the
Nehmer litigation. Nehmer v. U.S. Department of Veterans Affairs, Civ. Action No. 86-
6160 (N.D. Cal.). In the preamble to a proposed rule amending its claim adjudication
regulations (75 Fed. Reg. 14,391 (March 25, 2010)), VA summarized the Nehmer litigation
generally as follows: this litigation was initiated in 1986 to challenge a VA regulation,
which has since been rescinded, that limited the diseases shown to be associated with
herbicide exposure. In an order issued May 3, 1989, the court invalidated the portion of
the regulation that limits diseases associated with herbicide exposure and voided all VA
decisions denying benefit claims under that portion of the regulation. Nehmer v. United
States Veterans’ Administration, 712 F. Supp. 1404 (N. D. Cal. 1989). Pursuant to a
stipulation agreed to by the parties, VA must provide for readjudication of class members’
claims and payment of retroactive benefits whenever VA identifies a new disease that is
associated with herbicide exposure and adds a new disease to its regulatory list. In
addition, pursuant to the Agent Orange Act of 1991, VA is required to issue new
regulations establishing additional presumptions of service connection for diseases that
the Secretary finds to be associated with exposure to an herbicide agent. 38 U.S.C. §
1116(b). Accordingly, VA amended its adjudication regulations in August 2010 to establish
presumptive service connection for ischemic heart disease, Parkinson’s disease, as well
as hairy cell leukemia and other chronic B-cell leukemias. 75 Fed. Reg. 53,202 (August
31, 2010).




Page 12                                       GAO-13-89 VA Disability Benefits Processing
infectious disease risks and traumatic brain injuries. 17 Claims with many
conditions can take longer to complete because each condition must be
evaluated separately and then combined into a single percentage rating.
According to VA, in 2011, the number of medical conditions claimed by
veterans who served in Iraq and Afghanistan averaged 8.5, an increase
from 3-4 conditions per claim for Vietnam veterans.

Some claims processing staff have been assigned additional
responsibilities that can impede their ability to process claims or appeals
in a timely fashion. According to VBA officials, because of a large influx of
newly hired and promoted claims processing staff—1,973 new staff were
hired since 2009 and approximately 50 percent of claims processing staff
have been in their current role for less than 2 years—many staff have not
yet become fully proficient in their new roles and experienced staff have
been diverted from their claims processing responsibilities to conduct
training, mentor new hires, and review others’ work. 18 In addition to
training and mentoring, some claims processing staff at each of the five
regional offices we met with had been assigned to exclusively conduct
quality reviews instead of processing claims as part of the Quality Review
Team initiative. 19 At one regional office, 17 of 277 claims processing staff
were assigned to this team. Regional office officials said that while this
initiative has increased the quality of the ratings produced, it has
negatively affected the overall timeliness of claims processing.
Furthermore, officials at several regional offices we met with noted that
they diverted staff away from processing the oldest claims to respond to
inquiries from Congress, the administration, and veterans. Moreover, VBA



17
   GAO, Veterans’ Disability Benefits: Further Evaluation of Ongoing Initiatives Could Help
Identify Effective Approaches for Improving Claims Processing, GAO-10-213
(Washington, D.C.: January 29, 2010).
18
   As we reported in 2010, VBA’s goal is for newly hired VSRs to be proficient within 18
months and new RVSRs to be proficient within 2 years. See GAO-10-213. However,
becoming proficient often takes longer—about 3 to 5 years for RVSRs. While VBA hired
additional temporary staff using American Recovery and Reinvestment Act of 2009 funds,
they were given limited training and less complex claims processing tasks. According to
VBA officials, in 2011, VA received authority to convert temporary employees into
permanent staff, which required additional training and mentoring.
19
  The Quality Review Team (QRT) initiative was implemented nationally in March 2012
and consists of specially trained teams at regional offices that review claims files in the
development and rating phases to provide immediate feedback to employees and catch
adjudicative errors, as well as provide immediate feedback to claims processing staff
before their claims are finalized.




Page 13                                         GAO-13-89 VA Disability Benefits Processing
officials at one regional office said the number of claims processing staff
assigned to outreach activities has increased. Specifically, at the time of
our review, 37 out of 302 claims processing staff were conducting
outreach activities to servicemembers and veterans, such as giving
briefings and distributing materials at military bases about pre-discharge
and transition assistance programs. 20

According to VBA officials, a primary reason that appeals timeliness at VA
regional offices has worsened is a lack of staff focused on processing
these appeals. VBA officials at each of the five regional offices we met
with stated that over the last several years appeals staff have also had to
train and mentor new staff, conduct quality reviews, as well as develop
and rate disability claims to varying degrees. For example, at one regional
office, all staff on the appeals team focused exclusively on rating disability
claims for a 9-month period in 2010 instead of processing appeals.
Officials at another regional office stated that until 2012, their appeals
staff spent up to 2 weeks per month on non-appeals tasks. In addition, we
reported in 2011 that regional office managers estimated that Decision
Review Officers (DRO) spent on average 36 percent of their time on non-
appeals processing tasks. 21 A 2012 VA OIG report noted that VA regional
office managers did not assign enough staff to process appeals, diverted
staff from processing appeals, and did not ensure that appeals staff acted



20
   The pre-discharge program is a joint VA and Department of Defense (DOD) program
that affords service members the opportunity to file claims for disability compensation up
to 180 days prior to separation or retirement from active duty or full-time National Guard or
Reserve duty. There are four components of the pre-discharge program: Benefits Delivery
at Discharge, Quick Start, Disability Evaluation System, and Seriously Injured/Very
Seriously Injured. The Transition Assistance Program consists of comprehensive 3-day
workshops that are designed to help servicemembers as they transition from military to
civilian life. The program includes job search, employment and training information, as
well as VA benefits information for servicemembers who are within 12 months of
separation or 24 months of retirement. A companion workshop, the Disabled Transition
Assistance Program, provides information on VA's Vocational Rehabilitation and
Employment Program, as well as other programs for the disabled.
21
   In 2001, VA established the Decision Review Officer (DRO) review—an alternative
review process at the regional level. If a veteran chooses the DRO review, a DRO
conducts a de novo review of the claim, meaning a new and complete review without
deference to the original decision, and can revise that decision without new evidence or a
clear and unmistakable error—in other words, based on a difference of opinion. A DRO
also may make a new decision based on new evidence or clear and unmistakable error.
See GAO, Veterans Disability Benefits: Clearer Information for Veterans and Additional
Performance Measures Could Improve Appeal Process, GAO-11-812 (Washington, D.C.:
September 29, 2011).




Page 14                                         GAO-13-89 VA Disability Benefits Processing
                       on appeals promptly because, in part, they were assigned responsibilities
                       to process initial claims, which were given higher priority. 22 The VA OIG
                       recommended that VBA identify staffing resources needed to meet their
                       appeals processing goals, conduct DRO reviews on all appeals, and
                       revise productivity standards and procedures to emphasize processing
                       appeals in a timely manner, such as implementing criteria requiring
                       appeals staff to initiate a review or develop for Notices of Disagreement
                       and certified appeals within 60 days of receipt. VBA agreed with the VA
                       OIG’s findings and is conducting a pilot to assess the feasibility of
                       addressing these recommendations.


Program Requirements   According to VA officials, federal laws 23 and court decisions 24 over the
Contribute to Long     past decade have expanded veterans’ entitlement to benefits but have
Processing Times       also added requirements that can negatively affect claims processing
                       times. For example, the VCAA requires VA to assist a veteran who files a
                       claim in obtaining evidence to substantiate the claim before making a
                       decision. 25 This requirement includes helping veterans obtain all relevant
                       federal records and non-federal records. 26 VA is required to continue
                       trying to obtain federal records, such as VA medical records, military
                       service records, and Social Security records, until they are either obtained
                       or the associated federal entity indicates the records do not exist. VA may
                       continue to process the claim and provide partial benefits to the veteran,


                       22
                         VA Office of Inspector General, Veterans Benefits Administration: Audit of VA Regional
                       Office’s Appeals Management Processes, (Washington D.C.: May 30, 2012).
                       23
                         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.
                       24
                         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).
                       25
                            38 U.S.C. § 5103A(a)(1).
                       26
                          VA will make reasonable efforts to obtain relevant records that are not in the custody of
                       a federal department or agency, which can include records from state or local
                       governments, private medical-care providers, current or former employers, and other non-
                       federal governmental sources. Reasonable efforts generally consist of an initial request for
                       the records, and, if the records are not received, at least one follow-up request 15 days
                       later. A follow-up request is not required if a response to the initial request indicates that
                       the records sought do not exist or that a follow-up request for the records would be futile.
                       38 C.F.R. § 3.159.




                       Page 15                                         GAO-13-89 VA Disability Benefits Processing
but the claim cannot be completed until all relevant federal evidence is
obtained.

While VA must consider all evidence submitted throughout the claims and
appeals processes, if a veteran submits additional evidence or adds a
condition to a claim late in the claims process it can require rework and
may subsequently delay a decision, according to VBA central office
officials. VBA officials at regional offices we spoke to said that submitting
additional evidence may add months to the claims process. New
evidence must first be reviewed to determine what additional action, if
any, is required. Next, another notification letter must be sent to the
veteran detailing the new evidence necessary to redevelop the claim and
additional steps VA will take in light of the new evidence. Then, VA may
have to obtain additional records or order another medical examination
before the claim can be rated and a decision can be made. Furthermore,
while VA may continue to process the claim and provide partial benefits to
the veteran, a claim is not considered “complete” until a decision is made
on all conditions submitted by the veteran. Moreover, a veteran has up to
1 year, from the notification of VA’s decision, to submit additional
evidence in support of the claim before the decision is considered final. In
addition, a veteran may submit additional evidence in support of their
appeal at any time during the process. If the veteran submits additional
evidence after VA completes a Statement of the Case, VA must review
the new evidence, reconsider the appeal, and provide another written
explanation of its decision—known as a Supplemental Statement of the
Case. Congress recently passed a law allowing VA to waive review of
additional evidence submitted after the veteran has filed a substantive
appeal and instead have the new evidence reviewed by the Board to
expedite VA’s process of certifying appeals to the Board. 27

While federal law requires veterans to use an application form prescribed
by VA when submitting a claim for original disability compensation
benefits, VBA central office officials said they accept reopened claims or
claims requesting an increase in disability compensation benefits in any




27
   The Honoring America’s Veterans and Caring for Camp Lejeune Families Act of 2012,
(Pub. L. No. 112-154, § 501, 126 Stat. 1165, 1190). A claimant may request in writing that
the VA regional office initially review the evidence.




Page 16                                       GAO-13-89 VA Disability Benefits Processing
format, which can contribute to lengthy processing times. 28 VBA will
accept an original disability claim informally if it is submitted in a non-
standard format, but within 1 year the veteran must submit a VA Form 21-
526, Veteran’s Application for Compensation and/or Pension. 29 VBA does
not track the number of claims submitted in non-standard formats;
however, officials at three regional offices we met with said they receive
claims submitted in various formats, including hand-written letters.
Officials at these three regional offices said that when such claims are
submitted, there is a risk that claims staff may not be able to identify all
the conditions the veteran would like to claim during initial development.
For example, officials at one regional office stated that if these conditions
are discovered later in the process, then VA must redevelop the claim—
which could include sending another letter to the veteran, obtaining
additional records, and conducting another medical exam—before the
claim can be rated and a benefit amount determined and disbursed. VBA
officials said they expect the number of non-standard applications for
disability claims to decrease as more veterans file claims electronically
through the Veterans On Line Application (VONAPP), which is available
at VA’s eBenefits website. 30

Similar to processing for reopened claims, VA’s procedures allowing
veterans to submit appeals in any format can negatively affect appeals
processing times, according to VBA officials. For example, a veteran’s
intention to appeal a prior decision may be overlooked initially by staff
because there is no standard appeals submission form and a veteran’s
statement to appeal a prior decision may be included along with other
written correspondence for other purposes, such as submitting a new
claim, according to VBA officials. When appeals are overlooked and later



28
   38 U.S.C. § 5101(a). VA defines an original claim as an initial formal application on the
form prescribed by VA under the statute, and a reopened claim to include any application
for a benefit received after final disallowance of an earlier claim, or any application based
on additional evidence. 38 C.F.R. § 3.160(b) and (e).
29
  Under VA regulations, an informal claim is generally defined as any communication or
action indicating an intent to apply for one or more VA benefits, but which must identify the
benefit being sought. 38 C.F.R. § 3.155(a).
30
   The VONAPP website, created by VA in 2008, enables servicemembers, veterans, and
their beneficiaries, as well as other designated individuals, to apply for benefits, including
VA disability compensation, using the Internet. VA and DOD launched the eBenefits
website in 2009 to help servicemembers and veterans manage their benefits and personal
information.




Page 17                                         GAO-13-89 VA Disability Benefits Processing
                         found, it can delay recording Notices of Disagreement in appeals data
                         systems and result in longer processing times, according to VBA officials.


Gathering Records from   According to VBA officials, delays in obtaining military service and
Federal Agencies and     medical treatment records, particularly for National Guard and Reserve
Others Can Take Months   members, is a significant factor lengthening the evidence gathering
                         phase. According to VBA officials, 43 percent of Global War on Terror
                         veterans are National Guard and Reserve members. According to a VA
                         official, Department of Defense (DOD) Instruction 6040.45 requires
                         military staff to respond to VA requests for National Guard and Reserve
                         records in support of VA disability compensation claims. However, VBA
                         area directors and officials at all five regional offices we met with
                         acknowledged that delays in obtaining these records are a system-wide
                         challenge. Military records of National Guard or Reserve members can
                         often be difficult to obtain, in particular, because these servicemembers
                         typically have multiple, non-consecutive deployments with different units
                         and their records may not always be held with their reserve units and may
                         exist in multiple places. Moreover, according to VBA officials, National
                         Guard and Reserve members may be treated by private providers
                         between tours of active duty and VA may have to contact multiple military
                         personnel and private medical providers to obtain all relevant records,
                         potentially causing delays in the evidence gathering process.

                         Difficulties in obtaining timely and complete medical information,
                         especially from private medical providers, can also contribute to a lengthy
                         evidence gathering phase. For example, officials at one regional office
                         said the process may be delayed if veterans are slow to return their
                         consent forms that allow VA to pursue private medical records. Also,
                         according to VBA officials, private medical providers may not respond to
                         VA records requests in a timely fashion. In addition, officials at one
                         regional office we met with mentioned that time frames can also be
                         affected if veterans fail to show up for scheduled examinations. Officials
                         at two regional offices we met with said that even when medical records
                         are obtained, medical exams and opinions may include erroneous
                         information or be missing necessary evidence, which then requires VA
                         officials to follow-up with medical providers to clarify information. In some
                         cases, another examination must be ordered before a decision can be
                         made on the claim, which can add months to the process. VBA area
                         directors acknowledged that obtaining complete and sufficient medical
                         information is a system-wide challenge.




                         Page 18                                 GAO-13-89 VA Disability Benefits Processing
                          Difficulties obtaining Social Security Administration (SSA) medical
                          records, as one specific example, can also lengthen the evidence
                          gathering phase. Currently, an interagency agreement exists that
                          establishes the terms and conditions under which SSA discloses
                          information to VA for use in determining eligibility for disability benefits,
                          according to VBA officials. Although VBA regional office staff have direct
                          access to SSA benefits payment histories, they do not have direct access
                          to medical records held by SSA. If a veteran submits a disability claim
                          and reports receiving SSA disability benefits, VA is required to help the
                          veteran obtain relevant federal records, including certain SSA medical
                          records, to process the claim. VBA’s policy manual instructs claims staff
                          to fax a request for medical information to SSA and if no reply is received,
                          to wait 60 working days before sending a follow-up fax request. If a
                          response to the follow-up request is not received after 30 days, the
                          manual instructs claims staff to send an email request to an SSA liaison.
                          VBA officials at four of the five regional offices we reviewed told us that
                          when following this protocol, they have had difficulty obtaining SSA
                          medical records in a timely fashion. Moreover, they reported having no
                          contact information for SSA, beyond the fax number, to help process their
                          requests. In complying with VA’s duty to assist requirement, VBA staff
                          told us they continue trying to retrieve SSA records by sending follow-up
                          fax requests until they receive the records or receive a response that the
                          records do not exist. VBA area directors said some regional offices have
                          established relationships with local SSA offices and have better results,
                          but obtaining necessary SSA information has been an ongoing issue
                          nationally. For example, officials at one regional office said a response
                          from SSA regarding a medical records request can sometimes take more
                          than a year to receive.


Some Work Processes Are   VBA’s work processes, stemming mainly from its reliance on a paper-
Inefficient               based claims system, can lead to misplaced or lost documents, which can
                          contribute to lengthy processing times. VBA officials at three of the five
                          regional offices we met with mentioned that errors and delays in handling,
                          reviewing, and routing incoming mail to the correct claim folder can delay
                          the processing of a claim or cause rework. For example, VBA officials at
                          one regional office said that a claim may be stalled in the evidence
                          gathering phase if a piece of mail that contains outstanding evidence is
                          misplaced or lost. In addition, claims staff may rate a claim without
                          knowledge of the additional evidence submitted and then, once the mail is
                          routed to the claim folder, have to rerate the claim in light of the new
                          evidence received. Furthermore, VBA officials at one regional office we
                          met with said that processing can also be delayed if mail staff are slow to


                          Page 19                                 GAO-13-89 VA Disability Benefits Processing
record new claims or appeals into IT systems. As of August 2012, VBA
took 43 days on average to record Notices of Disagreement in the
appeals system—36 days longer than VBA’s national target. In May 2011,
the VA OIG reported that VA regional office mailroom operations needed
strengthening to ensure that staff process mail in an accurate and timely
manner. Specifically, the VA OIG found that staff did not always record
incoming mail into IT systems within 7 days of receipt and that they did
not properly process and route mail to existing claims folders in a timely
fashion in 10 of the 16 VA regional offices they reviewed. 31 VBA area
directors said that mail processing timeliness varies by regional office and
that the more efficient offices in general do a better job of associating mail
with the correct claims folder. In addition, VBA area directors said that
standardizing the mail handling and sorting process in an integrated mail
processing center—a component of the Claims Organizational Model
implemented in 18 regional offices in fiscal year 2012—is intended to
improve mail processing by involving more senior staff in the process.
VBA officials also said that moving claims folders among regional offices
and medical providers contributes to lengthy processing times. According
to a 2011 VA OIG report, processing delays occurred following medical
examinations because staff could not match claims-related mail with the
appropriate claim folders until the folders were returned from the VA
Medical Center. 32 In addition, processing halts while a claim folder is sent
to another regional office or brokering center.

Lastly, according to VBA officials, the lack of an integrated IT system that
provides all necessary information and functionality to track and process
claims and appeals can decrease the productivity of claims processing
staff. For example, according to staff at one VA regional office we spoke
with, currently, they must use different systems to track claims folders,
order medical exams, record claim processing actions taken by VBA staff
and evidence received on a claim, rate claims, process awards, and
record the status of appeals to the Board. The lack of an integrated
system requires staff to enter claim information multiple times, search
through multiple systems for claim information, and maintain processing
notes on the status of the claim or appeal in multiple systems. For



31
  VA Office of Inspector General, Systemic Issues Reported During Inspections at VA
Regional Offices, (Washington D.C.: May 18, 2011).
32
  VA Office of Inspector General, Systemic Issues Reported During Inspections at VA
Regional Offices.




Page 20                                      GAO-13-89 VA Disability Benefits Processing
                      example, officials at two regional offices we met with said RVSRs must
                      enter information into the Rating Board Automation system that was
                      already entered in the Modern Award Processing-Development (Map-D)
                      system. In addition, appeals staff must maintain claim processing notes
                      and information on the status of appeals in two different systems—one
                      maintained by the Board (Veterans Appeals Control and Locator System)
                      and one maintained by VBA (MAP-D). According to regional office staff,
                      the redundant data entry takes extra time that could have been spent
                      working on other cases. Moreover, staff at one regional office said they
                      did not always keep their claim processing notes up-to-date in both
                      systems.


                      VBA is currently taking steps to improve the timeliness of claims and
VBA Is Taking Steps   appeals processing. Based on a review of VA documents and interviews
to Improve Claims     with VBA officials, we identified 15 efforts with a stated goal of improving
                      claims and appeals timeliness. We selected 9 for further review—
and Appeals           primarily based on interviews with VBA officials and a review of recent VA
Processing, but       testimonies. VBA’s improvement efforts include using existing VBA staff
                      and contractors to manage workload, modifying and streamlining
Future Impact Is      procedures, improving records acquisition, and redesigning the claims
Uncertain             and appeals processes (see fig. 8). Although VBA is monitoring these
                      efforts, the planning documents provided to us lack key aspects of sound
                      planning, such as performance measures for each effort.




                      Page 21                                GAO-13-89 VA Disability Benefits Processing
Figure 8: Selected VBA Improvement Efforts




VBA Is Using Existing VBA              VBA has several ongoing efforts to leverage internal and external
Staff and Contractors to               resources to help manage its workload (see fig. 8). 33 One ongoing effort
Manage Its Growing                     that began in 2001 is the use of brokering centers—which are 13 special
                                       teams that process claims transferred from regional offices experiencing
Workloads                              a large backlog of claims. As we reported in 2010, these teams are
                                       staffed separately from other regional office teams. 34 According to VA
                                       officials, brokering centers gather evidence for the claim, make a
                                       decision, process awards payments, and work on appeals. Brokering
                                       center teams processed nearly 171,000 claims in fiscal year 2009,
                                       according to the VA OIG. VA central office officials told us that in fiscal
                                       years 2010 and 2011, all brokering centers focused exclusively on the re-
                                       adjudication of Agent Orange claims. Through the first 11 months of fiscal


                                       33
                                          For more information on all VBA initiatives to reduce claims and appeals processing
                                       times, see appendix III.
                                       34
                                            See GAO-10-213.




                                       Page 22                                       GAO-13-89 VA Disability Benefits Processing
                           year 2012, brokering centers processed approximately 24,000 claims.
                           VBA officials at several regional offices told us that brokering, over the
                           past year, has helped to manage their overall claims workload.

                           VBA also began the Veterans Benefits Management Assistance Program
                           (VBMAP) in late fiscal year 2011 to obtain contractor support for evidence
                           gathering for approximately 279,000 disability claims. 35 Under VBMAP,
                           regional offices send cases to a contractor to gather evidence. After
                           evidence has been gathered for an individual claim, the contractor sends
                           the file back to the originating regional office, which reviews the claim for
                           completeness and quality and then assigns a rating. Contractor staff are
                           required to complete their work within 135 days of receiving the file. 36 As
                           of June 2012, VBA regional offices we spoke with were awaiting the first
                           batch of claims that were to be sent to the contractors, so it remains to be
                           seen if VBMAP reduces processing times. Contractors are required to
                           provide VBA with status reports that include several measures of
                           timeliness, including the time it took to receive medical evidence from
                           providers and the time it took to return a claim to VBA for rating.


VBA Is Changing            With the intent of speeding up the claims and appeals processes, VBA
Procedures and Modifying   has several efforts that modify program requirements or relieve VA of
Requirements to Expedite   certain duties (see fig. 8). One effort is the Fully Developed Claims (FDC)
                           program, which began as a pilot in December 2008 and was implemented
Claims and Appeals         nationwide in June 2010. The FDC program was implemented in
Processing                 response to a congressional mandate that required VBA to conduct a pilot
                           program to expedite processing of fully developed claims in 90 days or
                           less. 37 Normally, once a veteran submits a claim, VBA will review the


                           35
                              To implement VBMAP, VBA has contracted with ACS Federal Solutions to conduct
                           evidence gathering for VBA claims, among other tasks, through a one-time, 12-month
                           professional services contract using funds from the fiscal year 2011 VA budget. ACS
                           employs contract staff at its London, Kentucky site to gather supporting evidence. Once
                           the evidence gathering is complete, the ACS contractor returns the evidence package to
                           VBA. ACS receives a fixed price for each completed evidence package.
                           36
                              The contractor is required to complete all claims requesting an increase in existing
                           disability benefits within 120 days of receipt.
                           37
                             Veterans’ Benefits Improvement Act of 2008, Pub. L. No. 110-389, § 221, 122 Stat.
                           4145, 4154. A fully developed claim is one where the veteran indicates that he or she
                           received appropriate assistance or does not intend to submit any additional information
                           and certifies that no additional information or evidence is available or needs to be
                           submitted.




                           Page 23                                         GAO-13-89 VA Disability Benefits Processing
claim and then send the veteran a letter detailing additional evidence
required to support the claim. The FDC program eliminates this step and
saves time because the required notification is provided to the veteran
directly on the FDC form. The program also attempts to reduce the time
VBA would normally spend gathering evidence for the veteran. In
exchange for expedited processing, veterans participating in the FDC
program send VBA any relevant private medical evidence with the claim
and certify that they have no additional evidence to provide. While VBA
officials and VSOs expect the program to reduce processing delays for
veterans, claims submitted without the required evidence are considered
incomplete. Furthermore, claims submitted under the FDC program with
incomplete evidence sometimes lose their priority status and are
processed with VBA’s non-expedited workload, which can result in
additional processing time. According to VBA officials, in the first 2 years
of the program, VBA has processed 33,001 FDC claims, taking an
average of about 98 days to complete—8 days longer than the goal of 90
days for these claims. VBA officials attribute not meeting FDC processing
time goals to the increased workload resulting from processing Agent
Orange claims. As of July 2012, veteran participation in the FDC program
has been low—only 4 percent of all compensation rating claims submitted
in 2012. A VBA official told us that in response to VSO input, they have
made the FDC form easier to use. Moreover, the VBA official we spoke
with expects more FDC claims once veterans are able to electronically file
claims. While FDC claims are currently submitted by paper, the proposed
electronic system will guide veterans through the steps to gather the
necessary evidence in support of their claim and draw information needed
on the form from VBA electronic databases.

VBA also began the Appeals Design Pilot—implemented at a single
regional office—in spring 2012 to expedite appeals processing. The pilot
modifies several program procedures with the goal of decreasing appeals
processing times, according to management at the regional office
conducting the pilot. For example, veterans participating in the pilot do not
file appeals in non-traditional formats. Instead, they use a standardized
Notice of Disagreement form. The pilot also forgoes the election of a
traditional versus a DRO review of an appeal—providing DRO reviews for




Page 24                                GAO-13-89 VA Disability Benefits Processing
                           all appeals from veterans participating in the pilot. 38 This change
                           eliminates the need for VBA to wait up to 60 days for a veteran to make
                           an election on the type of regional office review in an appeal. In addition,
                           veterans submitting new evidence during the appeal can opt to have their
                           case expedited directly to the Board without having the regional office
                           review the additional evidence submitted. In addition to those mentioned
                           above, the Appeals Design Pilot also has several other elements. For
                           example, expedited processing is provided to appeals that are filed with
                           only one or two disabling conditions. Under the pilot, some VSOs are also
                           waiving the right to a local review of the appeal, but preserving the current
                           practice of permitting VSOs to review the appeal once it goes before the
                           Board. 39 From March through June 2012, 2,300 veterans participated in
                           the pilot. According to VBA, pilot changes have, based on early results,
                           significantly improved processing times.

Efforts to Improve         VBA has established efforts to standardize and expedite the process for
Records Acquisition Have   acquiring medical records of veterans (see fig. 8). According to a VBA
Produced Mixed Results     official, in September 2010, in seven regional offices, VBA began the
                           Vendors for Private Medical Records initiative, which uses a contractor to
                           obtain veterans’ medical records from private physicians. 40 According to
                           VBA, as of July 2012, the contactor had obtained 39,662 treatment
                           records from private medical providers. VBA officials at one site told us
                           that the contractor is frequently able to communicate with doctors more
                           quickly because unlike claims staff who are tasked with multiple duties,
                           the contractor focuses solely on obtaining medical records.




                           38
                              As we reported in 2011, a veteran can appeal to the VA regional office that made the
                           initial decision. And if the veteran remains dissatisfied, he or she can appeal to the Board.
                           Appealing to the Board, however, can add more than 2 years, on average, to the wait time
                           for a decision. To resolve more appeals at the regional level and avoid waits at the Board,
                           VA established the DRO review as an alternative to the traditional regional office appeal
                           review. A DRO is given authority to grant additional benefits after reviewing an appeal
                           based on a difference of opinion with the original decision, without new evidence or a clear
                           and unmistakable error, as required in a traditional review (see GAO-11-812 ). Under this
                           process, veterans who submit a Notice of Disagreement are sent an election letter asking
                           them to decide between a traditional or DRO review of their appeal (veterans would
                           typically be given up to 60 days to make this selection).
                           39
                             VBA’s procedures allow a veteran’s representative, often a VSO, an opportunity to
                           review an appeal and submit a statement regarding the appeal.
                           40
                                VBA’s claims staff remain responsible for gathering evidence from VHA records.




                           Page 25                                         GAO-13-89 VA Disability Benefits Processing
                             VBA has another effort intended to reduce the amount of time spent
                             processing medical documentation. Specifically, physicians are asked to
                             complete Disability Benefits Questionnaires (DBQ), which are
                             standardized medical forms–downloaded from VA’s website—that are
                             designed to speed up the evidence gathering process by using check
                             boxes and standardized language that are intended to more accurately
                             capture information needed from providers. 41 The DBQ forms have been
                             available since March 2012, and VBA claims staff at the sites we visited
                             reported mixed results. For instance, the forms have helped to
                             standardize the medical evidence gathering process, but regional office
                             claims staff in four of the regional offices we met with said that some DBQ
                             forms are quite lengthy, requiring them to scan through multiple pages to
                             find certain information, which can be time-consuming. Claims staff also
                             reported that some of the medical terminology used in the forms is not
                             current, which may make it difficult for providers to complete. VBA
                             officials said that improvements will be made to the forms when the
                             agency converts to a paperless claims system, which might make it
                             easier for claims staff to locate information contained in them. VBA has
                             begun to track through their performance reporting system the number of
                             DBQs completed and the completeness of those submitted by physicians,
                             but is not measuring the initiative’s impact on timeliness.


Efforts to Redesign Key      In March 2012, VBA implemented a nationwide initiative that requires
Aspects of the Process Are   staff to use the Simplified Notification Letter (SNL), a process to
Under Way without a          communicate ratings decisions to veterans. 42 According to VBA officials,
                             the goal of the SNL is to reduce the time it takes claims staff to provide
Comprehensive Plan           veterans with claims decisions that are more consistent and easier to
                             understand. The SNL aims to reduce the time that VA staff spend
                             composing rating decisions for claims by providing staff with codes that
                             are associated with template language for rating decisions instead of the
                             previous practice of composing a free-form narrative for each claims
                             decision. According to claims staff at each of the regional offices we


                             41
                               There are more than 70 DBQs that cover a full range of medical conditions. While some
                             DBQs are specific to a single condition—such as hypertension, arthritis, or prostate
                             cancer—most forms can be used for several related conditions.
                             42
                                According to one VBA central office official, claims staff are not required to use the SNL
                             in all circumstances. For example, claims staff may opt to use a traditional decision letter
                             for decisions involving complex issues that require more information to explain the
                             rationale for the decision.




                             Page 26                                         GAO-13-89 VA Disability Benefits Processing
visited, SNL has decreased the time it takes to rate claims, but claims
staff in three regional offices told us it created additional steps in
preparing the decision letter sent to the veteran, adding time to the
processing awards phase. Claims staff we interviewed in one regional
office estimated that the time needed to authorize a claim had increased
from 3 minutes to 15 minutes. VBA officials said they have provided
additional guidance to staff experiencing challenges with the SNL. In spite
of these challenges, VBA reports an increase in production in two
regional offices that piloted the SNL initiative.

The Claims Organizational Model initiative is aimed at streamlining the
overall claims process (see fig. 8). For this initiative, VBA created
specialized teams that process claims based on their complexity.
Specifically, an “express team” processes claims with a limited number of
conditions or issues; a “special operations” team processes highly
complex claims, such as former prisoners of war or traumatic brain injury
cases; and a core team works all other claims. Each of these teams is
staffed with both development and ratings staff, which VBA believes will
lead to better coordination and knowledge-sharing. As of August 2012,
VBA had implemented the initiative at 18 regional offices. 43 Under this
model, VBA also redesigned the procedures that mailrooms use to sort
and process incoming claims. According to VBA central office staff, these
changes entail incorporating more experienced claims staff to improve the
process of routing incoming mail to the appropriate team and claims
folder. This change aims to reduce the time it takes for claims-related mail
to be entered into the claims processing systems. VBA tracks the impact
of the claims process model using existing timeliness metrics and
regional office performance measures.

In 2010, VBA began to develop the Veterans Benefits Management
System (VBMS), a paperless claims processing system that is intended to
help streamline the claims process and reduce processing times.
According to VBA officials, VBMS is intended to convert existing paper-
based claims folders into electronic claims folders that will allow VBA
employees electronic access to claims and evidence. Once completed,
VBMS will allow veterans, physicians, and other external parties to submit
claims and supporting evidence electronically. VBMS is currently being



43
   Before the initiative is rolled out to 18 of VA’s regional offices, VA commenced a pilot in
three regional offices in March 2012.




Page 27                                          GAO-13-89 VA Disability Benefits Processing
piloted in four VA regional offices. Although the most recent VBMS
operating plan calls for national deployment of VBMS to start in 2012,
VBA officials told us that VBMS is not yet ready for national deployment,
citing delays in scanning claims folders into VBMS as well as other
software performance issues. According to VBA officials, the Claims
Organizational Model and VBMS will work together to reduce processing
times and help VA process veterans’ claims within 125 days by 2015.
Although VBMS began its pilot in 2010, VBA has not yet reported on how
VBMS has affected processing times.

These ongoing efforts should be driven by a robust, comprehensive plan;
however when we reviewed VBA’s backlog reduction plan, we found that
it fell short of established criteria for sound planning. 44 Specifically, VBA
provided us with several documents, including a PowerPoint presentation
and a matrix that provided a high-level overview of over 40 initiatives, but
could not provide us with a robust plan that tied together the group of
initiatives, their inter-relationships, and subsequent impact on claims and
appeals processing times. Although there is no established set of
requirements for all plans, components of sound planning are important
because they define what organizations seek to accomplish, identify
specific activities to obtain desired results, and provide tools to help
ensure accountability and mitigate risks. Some of VBA’s planning
documents identify problems, summarize the overall purpose and goals of
the redesign effort, and include some general estimates of project
completion dates for some of the initiatives, as well as identify resources
for managing the overall implementation efforts. However, the planning
documents lack key elements of results-oriented planning. For example,
they do not identify implementation risks or strategies to address them. In
addition, the planning documents do not include performance goals,
measures to assess the effectiveness of each initiative, or their impact on
claims and appeals processing timeliness. VBA officials pointed out to us
the challenges in isolating the impact of any one initiative on processing



44
  Past GAO reports have identified best practices in planning. A results-oriented plan to
achieve established goals should include (1) purpose, scope, and methodology; (2)
problem definition and risk assessment; (3) goals, subordinate objectives, activities, and
performance measures; (4) resources, investments, and risk management; (5)
organizational roles, responsibilities, and coordination; and (6) integration. See GAO,
Social Security Disability: Additional Performance Measures and Better Cost Estimates
Could Help Improve SSA’s Efforts to Eliminate Its Hearings Backlog, GAO-09-398
(Washington, D.C.: September 9, 2009).




Page 28                                        GAO-13-89 VA Disability Benefits Processing
                      times. Nonetheless, sound practices require assessing the effectiveness
                      of each initiative.


                      VA provides a critical benefit to veterans who have incurred disabilities as
Conclusions           a result of their military service. For years, VA’s disability claims and
                      appeals processes have received considerable attention as VA has
                      struggled to process disability compensation claims in a timely fashion.
                      Despite this attention, VA continues to wrestle with several ongoing
                      challenges—some of which VA has little or no control over—that
                      contribute to lengthy processing timeframes. For instance, the number
                      and complexity of VA claims received has increased. And that number is
                      projected to continue to increase as 1 million servicemembers become
                      veterans over the next 5 years due to the drawdown of troops from a
                      decade of conflict in Afghanistan and Iraq. Moreover, the evidence
                      gathering phase in fiscal year 2011, which took over 5 months (157 days)
                      on average, continues to worsen in 2012, partly due to difficulties in
                      obtaining records for National Guard and Reserve and SSA medical
                      records, according to VBA officials. While recent process and technology
                      improvements hold some promise, without improved evidence gathering,
                      VBA may struggle to meet its goal of processing all compensation claims
                      within its 125 day goal by 2015. Although VBA is attempting to address
                      processing challenges through various improvement initiatives, without a
                      comprehensive plan to strategically manage resources and evaluate the
                      effectiveness of these efforts, the agency risks spending limited resources
                      on initiatives that may not speed up disability claims and appeals
                      processes. This may, in turn, result in forcing veterans to continue to wait
                      months and even years to receive compensation for injuries incurred
                      during their service to the country.

                      We recommend the Secretary of Veterans Affairs direct the Veterans
Recommendations for   Benefits Administration to:
Executive Action
                      1. Develop improvements for partnering with relevant federal and state
                         military officials to reduce the time it takes to gather military service
                         records from National Guard and Reserve sources.
                      2. Develop improvements for partnering with Social Security
                         Administration officials to reduce the time it takes to gather medical
                         records.
                      3. Ensure the development of a robust backlog reduction plan for VBA’s
                         initiatives that, among other best practice elements, identifies
                         implementation risks and strategies to address them and performance



                      Page 29                                 GAO-13-89 VA Disability Benefits Processing
                         goals that incorporate the impact of individual initiatives on processing
                         timeliness.

                     VA provided us with comments on a draft of this report, which are
Agency Comments      reprinted in appendix IV. In its comments, VA stated it generally agreed
and Our Evaluation   with our conclusions and concurred with our recommendations, and
                     summarized efforts that are planned or underway to address the
                     recommendations. Specifically, VA agreed with our recommendation to
                     partner with relevant federal and state military officials to develop
                     improvements to reduce the time it takes to gather military service
                     records for National Guard and Reservists. VA stated it has recently
                     initiated several interagency efforts to improve receipt of military service
                     records. According to VA, on December 3, 2012, the joint VBA and DOD
                     Disability Claims Reduction Task Force met to begin to evaluate the
                     process to request records, among other issues, with the aim of
                     improving the timeliness of record exchanges between the two agencies.
                     In addition, VA stated that the joint VA-DOD Virtual Lifetime Electronic
                     Record initiative is focused on developing a complete electronic health
                     record for each servicemember that will be transmitted to VA upon the
                     service member’s military discharge, including National Guard and
                     Reservists. VA identified a targeted completion date of November 2013.
                     We believe these initiatives are heading in the right direction in order to
                     improve the timeliness of meeting VA requests for National Guard and
                     Reservists records.

                     VA agreed with our recommendation to work with SSA officials to develop
                     improvements to reduce the time it takes to gather SSA medical records.
                     VA stated that it is working with SSA to pilot a web-based tool to provide
                     VA staff a secure, direct communication with SSA staff and to automate
                     VA’s requests for SSA medical records. VA officials did not mention this
                     pilot during the course of our data collection and it was not included on
                     the agency’s list of efforts to improve claims and appeals processing
                     initiatives provided to us. VA identified a targeted completion date of
                     November 2013.

                     VA agreed with our recommendation to develop a robust backlog plan for
                     VBA’s initiatives that, among other elements, identifies implementation
                     risks and strategies as well as performance goals that incorporate the
                     impact of individual initiatives on processing timeliness. VA describes a
                     number of approaches it has taken to address our recommendation. Most
                     relevant are the Transformation Plan, which was provided to us during the
                     data collection phase and which we determined fell short of established



                     Page 30                                 GAO-13-89 VA Disability Benefits Processing
criteria for sound planning, and the Operating Plan, which was not
mentioned during the course of our data collection. According to VA, the
operating plan, currently under development, will focus on: (1) integration
of people, process, and technology initiatives, (2) identification of new
ways to improve efficiency and reengineer the claims process, (3) efforts
to automate the current paper-based claims process, and (4) the
measurement process. However, it is unclear at this time how the key
elements of the operating plan will better position VA to address our
recommendation. Moreover, without further information on how the
operating plan will focus on the measurement process, it is difficult for us
to determine at this time if VA will sufficiently address our
recommendation to include performance goals that incorporate
measuring the impact of individual initiatives to processing timeliness.


As agreed with your office, unless you publicly announce its contents
earlier, we plan no further distribution of this report until 28 days from its
issue date. At that time, we will send copies of this report to the
appropriate congressional committees, the Secretary of Veterans Affairs,
and other interested parties. In addition, the report will be made available
at no charge on GAO’s website at http://www.gao.gov.

If you or your staff have any questions about 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. GAO staff who made key contributions to this
report are listed in appendix V.




Daniel Bertoni
Director, Education, Workforce, and Income Security Issues




Page 31                                 GAO-13-89 VA Disability Benefits Processing
List of Requesters

The Honorable Jeff Miller
Chairman
Committee on Veterans’ Affairs
House of Representatives

The Honorable Karen Bass
House of Representatives

The Honorable Shelley Berkley
House of Representatives

The Honorable Howard L. Berman
House of Representatives

The Honorable Brian P. Bilbray
House of Representatives

The Honorable Mary Bono Mack
House of Representatives

The Honorable Ken S. Calvert
House of Representatives

The Honorable John Campbell
House of Representatives

The Honorable Lois Capps
House of Representatives

The Honorable Judy Chu
House of Representatives

The Honorable Jim Costa
House of Representatives

The Honorable Susan Davis
House of Representatives

The Honorable David Dreier
House of Representatives



Page 32                          GAO-13-89 VA Disability Benefits Processing
The Honorable Elton Gallegly
House of Representatives

The Honorable Joe Heck
House of Representatives

The Honorable Duncan D. Hunter
House of Representatives

The Honorable Darrell Issa
House of Representatives

The Honorable Jerry Lewis
House of Representatives

The Honorable Kevin McCarthy
House of Representatives

The Honorable Howard P. McKeon
House of Representatives

The Honorable Gary Miller
House of Representatives

The Honorable Grace Napolitano
House of Representatives

The Honorable Laura Richardson
House of Representatives

The Honorable Dana Rohrabacher
House of Representatives

The Honorable Lucille Roybal-Allard
House of Representatives

The Honorable Ed Royce
House of Representatives

The Honorable Loretta Sanchez
House of Representatives




Page 33                               GAO-13-89 VA Disability Benefits Processing
The Honorable Adam Schiff
House of Representatives

The Honorable Brad Sherman
House of Representatives

The Honorable Henry A. Waxman
House of Representatives




Page 34                         GAO-13-89 VA Disability Benefits Processing
Appendix I: Objectives, Scope, and
              Appendix I: Objectives, Scope, and
              Methodology



Methodology

              This report examines the (1) factors that contribute to lengthy processing
              times for disability claims and appeals at the Department of Veterans
              Affairs (VA) and (2) status of the Veteran Benefits Administration’s (VBA)
              recent efforts to improve disability claims and appeals processing
              timeliness.

              To examine factors that contribute to lengthy processing times for
              disability claims and appeals, we reviewed past GAO and VA Office of
              Inspector General (OIG) reports and other relevant studies on VA’s
              claims and appeals processing, such as the Veterans’ Disability Benefits
              Commission’s 2007 report, Honoring the Call to Duty: Veterans’ Disability
              Benefits in the 21st Century. 1 We reviewed congressional testimonies,
              federal statutes, relevant court decisions, and policy manuals and
              documents, including VA’s Web Automated Reference Manual System to
              understand the program rules and procedures that govern the claims and
              appeals processes. We also analyzed disability compensation and
              pension rating claims processing data from VBA’s internal dashboard and
              data on claims processing resources from VBA’s Personnel and
              Accounting Integrated Database. Moreover, we interviewed VBA officials,
              including VBA area directors, the Office of Field Operations,
              Compensation Service, and the Office of Performance Analysis and
              Integrity to gain a national perspective on factors affecting the timeliness
              of claims and appeals processing. To identify factors within VA regional
              offices that contribute to lengthy processing times, we conducted reviews
              of five VA regional offices—Atlanta, Georgia; Houston, Texas; Los
              Angeles, California; New York, New York; and Philadelphia,
              Pennsylvania. These reviews consisted of interviewing regional office
              management and claims processing staff and supervisors, reviewing
              workload management and performance documents, and reviewing
              written notifications sent to veterans. We did not conduct case file reviews
              in these regional offices. We also spoke with representatives of Veterans
              Service Organizations (VSO) in Los Angeles and in Washington, D.C. to
              gather perspectives of veterans’ representatives on challenges in the
              claims and appeals processes.

              To examine the status of VBA’s recent efforts to improve disability claims
              and appeals processing timeliness, we reviewed past GAO and VA OIG



              1
               Veterans' Disability Benefits Commission, Honoring the Call to Duty: Veterans' Disability
              Benefits in the 21st Century (Washington, D.C.: October 2007).




              Page 35                                        GAO-13-89 VA Disability Benefits Processing
                        Appendix I: Objectives, Scope, and
                        Methodology




                        reports and congressional testimonies. We conducted interviews with
                        officials from the VBA Implementation Center, Office of Strategic Planning
                        and Office of Field Operations. Also, during our review of five VA regional
                        offices, we interviewed claims and appeals processing staff about their
                        experiences with VBA’s initiatives. To identify which VBA efforts were
                        designed to improve timeliness, we reviewed documents providing an
                        overview of the efforts, which included documentation identifying the
                        purpose of each effort. We requested additional information for those
                        initiatives that VBA identified as having the purpose of reducing disability
                        claims and appeals processing times. Furthermore, we selected a sample
                        of nine of VBA’s efforts identified as having the purpose of reducing
                        disability claims and appeals processing times for further review primarily
                        based on interviews with VBA officials and a review of recent VA
                        testimonies. In addition, we spoke with representatives of national VSOs
                        to gather their perspectives on the impact on the veterans they represent
                        of recent and ongoing efforts. (For more information on VBA’s
                        improvement efforts, see appendix III).


                        To assess VBA disability claims workload and processing timeliness, we
Analysis of VBA         obtained monthly regional office and national data from VBA’s internal
Claims and Appeals      dashboard, which aggregates key metrics used to assess performance
                        from a variety of data sources into one integrated tool. We limited our
Processing Timeliness   analysis to timeliness and workload metrics used to measure the
and Resource Data       performance of the disability compensation and pension rating claims and
                        appeals processing. We analyzed data from fiscal year 2009 through
                        August 2012. To verify the reliability of VBA’s internal dashboard, we
                        conducted interviews with officials from VBA’s Office of Performance
                        Analysis and Integrity about quality control procedures of VBA’s internal
                        dashboard and practices used to extract timeliness and workload data
                        from underlying data sources. We relied on past GAO data reliability
                        assessments on the Veterans Services Network (VETSNET) system and
                        accompanying VETSNET Operations Reports (VOR), and the Veterans
                        Appeals Control and Locator System (VACOLS), where enterprise-wide
                        workload and timeliness of claims and appeals processing data,
                        respectively, are stored and extracted into the internal dashboard tool.
                        We found the dashboard data to be reliable for reporting regional office
                        and national workload and timeliness trends.

                        To analyze VBA’s claims and appeals processing resources, we obtained
                        data from VA’s Personnel and Accounting Integrated Database and
                        accompanying ProClarity system. We limited our analysis to data on VBA
                        job titles that typically include claims or appeals processing


                        Page 36                                GAO-13-89 VA Disability Benefits Processing
                       Appendix I: Objectives, Scope, and
                       Methodology




                       responsibilities—Veterans Service Representatives (VSR), Rating
                       Veterans Service Representatives (RVSR), and Decision Review Officers
                       (DRO)—from fiscal years 2009 through 2012. We reviewed data on full-
                       time equivalents (FTE), number of employees, and personnel actions. To
                       assess the reliability of these data, we interviewed officials in VBA’s
                       Office of Human Resources about practices to record personnel actions,
                       quality control procedures conducted within the Office of Human
                       Resources to ensure the quality of the data, as well as potential
                       limitations to the data. We found the data provided to us by the Office of
                       Human Resources reliable for reporting on claims and appeals
                       processing resources.


                       We selected five VA regional offices for review to gather information on
Selection of VA        the challenges these selected regional offices face in not only processing
Regional Offices for   disability claims and appeals in a timely fashion, but also in implementing
                       initiatives designed to address processing timeliness. Our five selected
Review                 sites, which account for 15 percent of all disability compensation and
                       pension rating claims, were Atlanta, Georgia; Houston, Texas; Los
                       Angeles, California; New York, New York; and Philadelphia,
                       Pennsylvania. We conducted site visits with the Los Angeles,
                       Philadelphia, and Atlanta regional offices and teleconferences with the
                       New York and Houston regional offices.

                       We selected regional offices for review based on the following criteria:

                       •   Geography: We selected at least one VA regional office in each of
                           VBA’s four areas. The New York and Philadelphia regional offices are
                           in the Eastern Area, Atlanta is in the Southern Area, Houston is in the
                           Central Area, and Los Angeles is in the Western Area.
                       •   Size of metropolitan area: We limited our selection process to
                           regional offices in the Top 15 Metropolitan Statistical Areas (MSA)
                           according to 2010 Census data, due to concerns about the ability of
                           these offices to recruit and retain staff and upper management.
                       •   Workload: We selected VA regional offices with medium or high
                           disability compensation and pension rating claims workloads. All
                           regional offices in the top 15 MSAs had more than 10,000 disability
                           compensation and pension rating claims pending. According to VBA’s
                           internal dashboard, the median regional office had 8,850 disability
                           compensation and pension rating claims pending as of April 2012.
                           The sites we selected had workloads ranging from 15,874 to 37,805
                           pending disability compensation and pension rating claims in April
                           2012.



                       Page 37                                GAO-13-89 VA Disability Benefits Processing
Appendix I: Objectives, Scope, and
Methodology




•   Timeliness: To examine the timeliness of claims processing at VA
    regional offices, we examined two metrics: the percentage of
    backlogged disability compensation and pension rating claims—
    defined as claims pending over 125 days–and the average number of
    days a disability compensation and pension rating claim was pending.
    According to VBA’s internal dashboard, 65.6 percent of disability
    compensation claims nationally were pending over 125 days in April
    2012. For the regional offices we selected, the percent of backlogged
    claims ranged from 61.6 percent to 79.9 percent. Claims were
    pending an average 243.2 days nationally. For the regional offices we
    selected, the average days pending ranged from 219.6 days to 325.3
    days.

We conducted this performance audit from March 2012 through
December 2012 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.




Page 38                               GAO-13-89 VA Disability Benefits Processing
Appendix II: Veteran Notification during the
                                        Appendix II: Veteran Notification during the
                                        Claims and Appeals Processes



Claims and Appeals Processes

                                        After VBA receives a disability claim, it generally sends notifications to
                                        veterans to either help gather evidence or to let them know that a
                                        decision has been made (see fig. 9). Throughout the claims process, VBA
                                        sends a standard form letter at the 60-, 120-, and 180-day marks, as
                                        applicable, to inform the veteran that VBA has received the claim and that
                                        the claim is still pending. During the initiating development phase, VBA
                                        sends the Veteran Claims Assistance Act (VCAA) letter acknowledging
                                        receipt of the claim, explaining the claims process, and outlining what
                                        additional information is needed and what steps VBA will take to
                                        substantiate the claim. Much of the notification to veterans occurs during
                                        the evidence gathering phase. During this phase, VBA sends the veteran
                                        a notification every time VBA makes an attempt to obtain additional
                                        evidence or when attempts to obtain evidence have been unsuccessful.
                                        Finally, at the end of the award processing phase, a decision letter is sent
                                        to the veteran.

Figure 9: VBA Notifications to Veterans throughout the Claims Process




                                        During the appeals process, VBA generally reaches out to veterans when
                                        additional evidence or the veteran’s input is needed, or to announce and
                                        explain a decision. The appeals process generally begins when a veteran
                                        disagrees with VA’s decision on their disability claim, and files a Notice of
                                        Disagreement (see fig. 10). If the veteran does not specify the type of
                                        review in the Notice of Disagreement, VBA sends an election letter that
                                        details the differences between a traditional and DRO review and asks
                                        the veteran to choose a review process. Once a veteran indicates the


                                        Page 39                                        GAO-13-89 VA Disability Benefits Processing
Appendix II: Veteran Notification during the
Claims and Appeals Processes




type of review desired, VBA sends a process letter that explains the
review process chosen and details the veteran’s rights throughout the
appeals process. 1 Then, if additional evidence is needed to make a
decision, such as ordering another Veterans Health Administration (VHA)
examination, VBA sends notifications to the veteran throughout the
evidence gathering process, similar to the initial claims process. Once all
additional evidence is gathered, VBA will review the case. If VBA grants
the appeal in full, a decision letter is sent. If VBA denies the appeal or
does not grant the appeal in full, it sends a Statement of the Case (SOC)
explaining the decision. At this point, the veteran has the option to send in
additional evidence, which VBA must consider, and if this evidence does
not lead to a full grant, then VBA must send a Supplemental Statement of
the Case (SSOC) explaining their decision.




1
 If the veteran does not reply to the election letter within 60 days, the appeal proceeds as
a traditional review.




Page 40                                         GAO-13-89 VA Disability Benefits Processing
                                        Appendix II: Veteran Notification during the
                                        Claims and Appeals Processes




Figure 10: VBA Notifications to Veterans throughout the Appeals Process




                                        Note: If the veteran chooses the traditional review, the reviewer, who may be a RVSR or DRO,
                                        examines the claim file and any new evidence that the veteran submits and may hold a formal,
                                        transcribed hearing with the veteran. The reviewer may overturn the original decision based only on
                                        (1) new evidence or (2) a clear and unmistakable error made in the original decision. However, if a
                                        veteran chooses the DRO review, a DRO conducts a de novo review of the claim, meaning a new
                                        and complete review without deference to the original decision, and can revise that decision without
                                        new evidence or a clear and unmistakable error—in other words, based on a difference of opinion. 38
                                        C.F.R. §3.2600


                                        In addition to receiving written notifications during the claims and appeals
                                        processes, veterans can proactively learn about the status of their claims



                                        Page 41                                            GAO-13-89 VA Disability Benefits Processing
Appendix II: Veteran Notification during the
Claims and Appeals Processes




in several ways. For example, veterans can use eBenefits, a website that
VA and the Department of Defense launched in 2009 to help
servicemembers and veterans manage their benefits and personal
information. Veterans can also speak with staff in VA’s national call center
or can contact VA through VA’s web-based Inquiry Routing and
Information System (IRIS). Veterans can also visit a VA regional office to
speak with VA public contact staff.




Page 42                                        GAO-13-89 VA Disability Benefits Processing
Appendix III: Selected VBA Efforts to
                                            Appendix III: Selected VBA Efforts to Improve
                                            Claims and Appeals Timeliness



Improve Claims and Appeals Timeliness

                                            According to VBA, there are currently over 40 ongoing improvement
                                            efforts that are tracked by VBA’s Implementation Center. Below is a list of
                                            15 improvement efforts we identified as having a stated purpose of
                                            improving timeliness of claims or appeals processing, based on a review
                                            of VA documents and interviews with VBA officials.

Table 1: Selected VBA Efforts to Improve Claims and Appeals Timeliness

                                                                                                                       Selected for
VBA effort           Description                                           Purpose                 Status              review by GAO
Acceptable Clinical The ACE process allows a VHA clinician to              To improve the          Piloted in one      No
Evidence (ACE)      complete a Disability Benefit Questionnaire in lieu    timeliness of           regional office
Pilot               of conducting a medical exam if a veteran’s            obtaining medical
                    existing medical record contains sufficient            examinations
                    evidence.
Agent Orange         The Fast Track Claims Processing System is an         To reduce average       Implemented         No
Development          accelerated claims process dedicated to Vietnam       days to complete        nationally in
Assistance (“Fast    veterans who are diagnosed with an Agent Orange       Agent Orange            October 2010
Track”)              presumptive condition, such as ischemic heart         claims
                     disease, hairy cell and other B-cell leukemias, and
                     Parkinson’s disease.
Appeals Design       The Appeals Design Pilot has made several             To improve appeals Pilot stage began        Yes
Pilot                changes to the appeals process during the pilot       processing         in March 2012
                     including:                                            timeliness
                     •    Creating an express lane for appeals with one
                          or two issues;
                     •    Developing a standard Notice of Disagreement
                          form;
                     •    Obtaining waivers from veterans to allow VBA
                          to expedite their substantive appeal directly to
                          the Board of Veterans’ Appeals without having
                          the regional office review new evidence
                          submitted;
                     •    Conducting Decision Review Officer (DRO)
                          reviews for all appeals;
                     •    Proactive phone outreach to veterans to
                          reduce the need for formal DRO hearings; and
                     •    Obtaining waivers of local VSO review period
                          prior to certifying the appeal to the Board of
                          Veterans’ Appeals.
Brokering centers    The brokering process is used to manage workload      To reduce workload Implemented              Yes
                     across regional offices by permitting a regional      at regional offices nationally in 2001
                     office to shift claims either to another regional     experiencing
                     office or to a specialized brokering center for       processing delays
                     processing.




                                            Page 43                                            GAO-13-89 VA Disability Benefits Processing
                                               Appendix III: Selected VBA Efforts to Improve
                                               Claims and Appeals Timeliness




                                                                                                                           Selected for
VBA effort            Description                                            Purpose                 Status                review by GAO
Claims                The Claims Organizational Model streamlines the        To reduce the           Implemented at        Yes
Organizational        claims process by organizing claims staff into         average days to         selected regional
Model                 cross-functional teams, creating segmented lanes       complete claims by      offices; national
                      based on type and complexity of claims, and            40 days                 implementation
                      standardizing the mail triage and sorting process in                           scheduled for
                      an integrated mail processing center.                                          completion by end
                                                                                                     of fiscal year 2013
Disability Benefits   DBQs are standard checklists that VA asks              To increase the use Implemented         Yes
Questionnaire         physicians to fill out instead of preparing a          of standard         nationally in March
(DBQ)                 narrative report of an examination.                    evaluation forms to 2012
                                                                             speed up claims
                                                                             determination
Fully Developed       The FDC initiative expedites processing of claims      To reduce the       Implemented               Yes
Claims (FDC)          submitted by veterans who submit all relevant          average days to     nationally in May
                      private medical evidence.                              complete a decision 2010
                                                                             by 140 days
Immersion Teams       Management teams from high performing offices       To improve regional        Implemented in        No
                      observe low performing offices and help codify best office performance         four regional
                      practices to help the low performing offices        management                 offices in October
                      improve.                                                                       2011
National Level     Challenge training is a course designed for newly-        To increase the        Implemented            No
Challenge Training assigned claims processing staff. In 2011, the            number and             nationally in fiscal
                   curriculum was redesigned to lengthen the training        accuracy of            year 2011
                   period and incorporate the hands-on instruction           completed claims
                   previously conducted within regional offices into         per claims
                   training at centralized sites. Additionally, challenge    processing staff full-
                   training is sometimes used to retrain experienced         time equivalents
                   staff as well.                                            (FTE)
Proactive Phone       In place of writing letters to gather evidence, VBA    To decrease             Implemented           No
Development           will use phone calls to speed the development          average days to         nationally in May
                      process and clarify veteran information/requests.      completion of a         2010; revised in
                                                                             claim                   March 2012
Simplified            SNL is a standardized process that integrates          To increase the         Implemented         Yes
Notification Letter   decision information into one simplified letter for    number of claims        nationally in March
(SNL)                 veterans.                                              rated per year by       2012
                                                                             250,000
Timeliness            One VA regional office has an effort to improve        To improve           Implemented at      No
Performance           timeliness by changing individual performance          timeliness of claims one regional office
Standards             goals for claims staff by incorporating timeliness     processing           in March 2012
                      goals into their performance goals.
Vendors for Private Vendors for Private Medical Records is an initiative To reduce average           Piloted at seven      Yes
Medical Records     in which a contractor collects medical records from record collection            regional offices
                    private physicians.                                  time from 40 days           since September
                                                                         to 7-10 days and            2010
                                                                         substantially
                                                                         increase physician
                                                                         response rate




                                               Page 44                                           GAO-13-89 VA Disability Benefits Processing
                                           Appendix III: Selected VBA Efforts to Improve
                                           Claims and Appeals Timeliness




                                                                                                                                      Selected for
VBA effort          Description                                                      Purpose                        Status            review by GAO
Veterans Benefits   VBMAP is an effort to manage workload by                         To reduce evidence Implemented          Yes
Management          permitting a regional office to shift a pre-                     gathering workload nationally; contract
Assistance          determined number of claims to a contractor for                  at regional offices began in
Program (VBMAP)     evidence gathering.                                                                  September 2011
Veterans Benefit    VBMS is an effort to design a paperless claims       To decrease the                            Partially          Yes
Management          system that will allow electronic submission of      average days to                            implemented;
System (VBMS)       claims and supporting evidence and convert paper- complete a claim                              plans to implement
                    based claims folders into electronic claims folders.                                            nationally in 2013


                                           Source: GAO analysis of VBA documentation and interviews with VBA officials.

                                           Note: Primarily based on a review of VA documents and interviews with VBA officials, we selected for
                                           review a sample of 9 VBA efforts (out of 15) that have the purpose of reducing disability claims and
                                           appeals processing times.




                                           Page 45                                                            GAO-13-89 VA Disability Benefits Processing
Appendix IV: Comments from the
             Appendix IV: Comments from the Department
             of Veterans Affairs



Department of Veterans Affairs




             Page 46                                     GAO-13-89 VA Disability Benefits Processing
Appendix IV: Comments from the Department
of Veterans Affairs




Page 47                                     GAO-13-89 VA Disability Benefits Processing
Appendix IV: Comments from the Department
of Veterans Affairs




Page 48                                     GAO-13-89 VA Disability Benefits Processing
Appendix IV: Comments from the Department
of Veterans Affairs




Page 49                                     GAO-13-89 VA Disability Benefits Processing
Appendix IV: Comments from the Department
of Veterans Affairs




Page 50                                     GAO-13-89 VA Disability Benefits Processing
Appendix V: GAO Contact and Staff
                  Appendix V: GAO Contact and Staff
                  Acknowledgments



Acknowledgments

                  Daniel Bertoni, Director, Education Workforce and Income Security,
GAO contact       bertonid@gao.gov, 202-512-7215


                  In addition to the contact named above, Brett Fallavollita (Assistant
Staff             Director); Lucas Alvarez; Michelle Bracy; and Ryan Siegel made key
Acknowledgments   contributions to this report. In addition, key support was provided by
                  James Bennett, Robert Campbell, Susan Chin, James Rebbe, Almeta
                  Spencer, Kathleen van Gelder, and Walter Vance.




                  Page 51                               GAO-13-89 VA Disability Benefits Processing
Related GAO Products
             Related GAO Products




             VA Disability Compensation: Actions Needed to Address Hurdles Facing
             Program Modernization. GAO-12-846. Washington, D.C.: September 10,
             2012.

             VA Enhanced Monthly Benefits: Recipient Population Is Changing, and
             Awareness Could Be Improved. GAO-12-153. Washington, D.C.:
             December 14, 2011.

             Veterans Disability Benefits: Clearer Information for Veterans and
             Additional Performance Measures Could Improve Appeal Process.
             GAO-11-812. Washington, D.C.: September 29, 2011.

             Information Technology: Department of Veterans Affairs Faces Ongoing
             Management Challenges. GAO-11-663T. Washington, D.C.: May 11,
             2011.

             GAO’s 2011 High-Risk Series: An Update. GAO-11-394T. Washington,
             D.C.: February 17, 2011.

             Veterans’ Disability Benefits: Expanded Oversight Would Improve
             Training for Experienced Claims Processors. GAO-10-445. Washington,
             D.C.: April 30, 2010.

             Veterans’ Disability Benefits: Further Evaluation of Ongoing Initiatives
             Could Help Identify Effective Approaches for Improving Claims
             Processing. GAO-10-213. Washington, D.C.: January 29, 2010.

             Social Security Disability: Additional Outreach and Collaboration on
             Sharing Medical Records Would Improve Wounded Warriors’ Access to
             Benefits. GAO-09-762. Washington, D.C.: September 16, 2009.

             Veterans’ Benefits: Increased Focus on Evaluation and Accountability
             Would Enhance Training and Performance Management for Claims
             Processors. GAO-08-561. Washington, D.C.: May 27, 2008.

             Veterans’ Disability Benefits: Claims Processing Challenges Persist, while
             VA Continues to Take Steps to Address Them. GAO-08-473T.
             Washington, D.C.: February, 14, 2008.




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             Page 52                                GAO-13-89 VA Disability Benefits Processing
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