[Senate Hearing 110-466]
[From the U.S. Government Publishing Office]



                                                        S. Hrg. 110-466
 
 HEARING ON REVIEW OF VETERANS' DISABILITY COMPENSATION: REPORT OF THE 
                VETERANS' DISABILITY BENEFITS COMMISSION

=======================================================================

                                HEARING

                               BEFORE THE

                     COMMITTEE ON VETERANS' AFFAIRS
                          UNITED STATES SENATE

                       ONE HUNDRED TENTH CONGRESS

                             SECOND SESSION

                               __________

                            JANUARY 24, 2008

                               __________

       Printed for the use of the Committee on Veterans' Affairs


 Available via the World Wide Web: http://www.access.gpo.gov/congress/
                                 senate





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                     COMMITTEE ON VETERANS' AFFAIRS

                   Daniel K. Akaka, Hawaii, Chairman
John D. Rockefeller IV, West         Richard Burr, North Carolina, 
    Virginia                             Ranking Member
Patty Murray, Washington             Arlen Specter, Pennsylvania
Barack Obama, Illinois               Larry E. Craig, Idaho
Bernard Sanders, (I) Vermont         Kay Bailey Hutchison, Texas
Sherrod Brown, Ohio                  John Ensign, Nevada
Jim Webb, Virginia                   Lindsey O. Graham, South Carolina
Jon Tester, Montana                  Johnny Isakson, Georgia
                    William E. Brew, Staff Director
                 Lupe Wissel, Republican Staff Director


                            C O N T E N T S

                              ----------                              

                            January 24, 2008
                                SENATORS

                                                                   Page
Akaka, Hon. Daniel K., Chairman, U.S. Senator from Hawaii........     1
Burr, Hon. Richard, Ranking Member, U.S. Senator from North 
  Carolina.......................................................     2
Murray, Hon. Patty, U.S. Senator from Washington.................     4
Tester, Hon. Jon, U.S. Senator from Montana......................     6
Craig, Hon. Larry E., U.S. Senator from Idaho....................     7

                               WITNESSES

Scott, James Terry, LTG, USA (Ret.), Chairman, Veterans' 
  Disability Benefits Commission.................................     8
    Prepared statement...........................................    12
        Attachment...............................................    16
    Response to written questions submitted by:
      Hon. Daniel K. Akaka.......................................    24
      Hon. Richard Burr..........................................    30
      Hon. Kay Bailey Hutchison, U.S. Senator from Texas.........    30
Bowers, Todd, Director of Government Affairs, Iraq and 
  Afghanistan Veterans of America................................    40
    Prepared statement...........................................    41
Manar, Gerald T., Deputy Director, National Veterans Service, 
  Veterans of Foreign Wars of the United States..................    42
    Prepared statement...........................................    44
Smithson, Steve, Deputy Director, Veterans Affairs and 
  Rehabilitation Commission, The American Legion.................    47
    Prepared statement...........................................    49


 HEARING ON REVIEW OF VETERANS' DISABILITY COMPENSATION: REPORT OF THE 
                VETERANS' DISABILITY BENEFITS COMMISSION

                              ----------                              


                      THURSDAY, JANUARY 24, 2008.

                               U.S. Senate,
                    Committee on Veterans' Affairs,
                                                    Washington, DC.
    The committee met, pursuant to notice, at 9:30 a.m., in 
Room 562 Dirksen Senate Office Building, Hon. Daniel K. Akaka, 
Chairman of the Committee, presiding.
    Present: Senators Akaka, Murray, Tester, Burr, and Craig.

     OPENING STATEMENT OF HON. DANIEL K. AKAKA, CHAIRMAN, 
                    U.S. SENATOR FROM HAWAII

    Chairman Akaka. This hearing will come to order. Aloha, and 
welcome to today's hearing: the first in a series of hearings I 
intend to hold to review veterans' disability compensation.
    Today our focus will be on the recommendations of the 
Veterans' Disability Benefits Commission.
    I am grateful that we are joined by General James Terry 
Scott, Chairman of that Commission. I was pleased to speak 
before the Commission more than two years ago and feel that we 
have come full circle with General Scott's appearance today.
    General Scott, I publicly thank you and your fellow 
commissioners for all of your dedicated work on the Commission, 
and I especially thank you for your continued work such as 
appearing here today, following the end of the Commission's 
formal activity.
    I would like to take this opportunity to offer my 
condolences on the passing of Commissioner ``Butch'' Joeckel, a 
decorated Marine and combat veteran who died in October of last 
year, shortly after the Commission completed its work.
    The review of veterans' disability compensation that we 
embark on today falls into three separate issue areas. First, 
the question of what should be compensated generally--which 
encompasses quality of life issues, the current Rating Schedule 
and the development of presumptions, among a host of issues.
    Second, how can the current adjudication system be improved 
to yield more timely and accurate decisions, and how will 
efforts on this front be impacted by the efforts to deal with 
the questions under the first category.
    And third, how can Congress and the Executive Branch 
promote greater coordination and consistency between the VA and 
DOD disability processes.
    These are complex and far-reaching questions and I do not 
believe they can be dealt with quickly. Congress must undertake 
a thoughtful and deliberate review and analysis of the many 
matters at issue and then work to develop legislation that will 
result in appropriate reform of the disability compensation 
system.
    The Veterans' Disability Benefits Commission's report is a 
significant part of a road map that will enable the Committee 
to better understand and address these three separate issue 
areas. I hope that at the end of today's hearing, we will 
better understand the work that went into the report, the input 
that was received, and the Commission's recommendations.
    I thank the representatives of veterans' organizations for 
their presence here today. It is my hope that they will share 
their organizations' response to the Commission's 
recommendations so that we might better understand the 
potential impact of implementing any of the Commission's 
recommendations.
    In the interest of time, I'll stop here and turn to our 
Committee's Ranking Member and welcome him back into the second 
session and look forward to working together to help our 
veterans. I call for his opening remarks.
    Senator Burr.

        STATEMENT OF HON. RICHARD BURR, RANKING MEMBER,
                U.S. SENATOR FROM NORTH CAROLINA

    Senator Burr. Thank you, Mr. Chairman, and Happy New Year 
to you and to all of the Members.
    General Scott, welcome, and welcome to our other witnesses.
    I appreciate all of them being here today. The disability 
system for our injured servicemembers is a vital component for 
us to look at.
    General Scott, your Commission provided many valuable 
suggestions that will help guide our efforts to meet the needs 
of today's wounded warriors. As we discuss those 
recommendations we should keep in mind the men and the woman 
going through the disability system today.
    I've had the opportunity to meet with many young men and 
women who suffered devastating injuries while in Iraq and 
Afghanistan.
    Almost as remarkable as their courage and their can-do 
attitudes are their prospects about the future. These wounded 
warriors rightfully expect that serious injuries should not 
prevent them from leading productive and fulfilling lives. In 
fact, many want nothing less than to return to their units. And 
with modern medicine and technology, many, I'm proud to say, 
are doing so.
    But, for those who are not able to continue serving, they 
deserve a disability system that meets the needs and 
expectations of this new generation of veterans. They should be 
provided--in a quick, effective, and hassle-free manner--with 
the benefits and services they need to help them return to full 
and productive lives.
    As we will discuss today, the Disability Commission has 
identified a number of changes that must be made to the system 
for that to be accomplished. The Commission recommended 
realigning the process so DOD will be responsible for 
determining fitness for duty and VA for assigning the 
disability ratings.
    The Commission also stressed the need to immediately begin 
updating the Disability Rating Schedule and to compensate 
veterans for any loss of quality of life caused by their 
service-related disabilities.
    In addition, the Commission emphasized that the goal of 
disability benefits should be rehabilitation and reintegration 
into civilian life, but found that this goal is not being met. 
As one means of addressing the deficiencies, the Commission 
suggested the use of incentives to encourage veterans to 
complete rehabilitation programs, and I'm proud to tell you 
that this Committee has that type of change under discussion.
    As you may recall, another distinguished Commission, 
chaired by Senator Dole and Secretary Shalala, made very 
similar recommendations last year. Remarkably, the same types 
of reforms were also recommended in 1956 by a Commission led by 
General Omar Bradley.
    As the Bradley Commission found, ``our philosophy of 
veterans' benefits must . . . be modernized and the whole 
structure of traditional veterans' programs brought up to 
date.'' Despite the fact that the disability system was already 
outdated more than five decades ago, there's been no 
fundamental reform and veterans from Operation Iraqi Freedom 
and Operation Enduring Freedom are now experiencing the 
consequences of our inaction.
    Let's not forget the news reports last year about seriously 
injured servicemembers at Walter Reed going through a lengthy, 
hard-to-understand, bureaucratic process to try to get 
disability benefits. This left many injured servicemembers and 
their families frustrated, confused and disappointed.
    Having received that wake-up call about the failings of the 
current system, we cannot continue to ignore the need for 
modernization. We need to create a system for today's veterans 
and not leave them with a system that was outdated before they 
were even born.
    To start us on this path, I have been working on a bill 
that would help to create a modern, less confusing, more 
equitable system for today's warriors. The intent of this bill 
would be to get DOD out of the business of assigning disability 
ratings, to require the entire outdated Rating Schedule be 
replaced with a modern schedule, and to compensate veterans for 
loss of quality of life--exactly what your Commission 
recommended.
    Also, this bill would authorize new transition payments for 
injured servicemembers who are found unfit for duty. If we help 
cover family living expenses as an injured veteran adjusts to 
civilian life, the veteran may be better able to focus on 
rehabilitation, training, and reintegration into the work 
force.
    My goal would be to create a modern system that does not 
distinguish between combat and non-combat injuries and would be 
open to veterans of any generation. I know many of you share 
these goals and some of you have concerns that the VA might be 
flooded with claims if we allow all veterans into the new 
system. I understand those concerns and I share those concerns. 
But, if modernizing the system is the right thing to do, and I 
believe it is, this should not stop us from moving forward. 
Instead, Mr. Chairman, I hope we can work together to find the 
best way to modernize this system for all veterans.
    So, I hope today we are at the start of a serious dialogue 
about how we can help VA deal with the possible large influx of 
claims if this modern system becomes reality.
    As a final note, I want to acknowledge that modernizing the 
disability system will not be easy and may require a large up-
front cost. But, this is an obligation we cannot put off for 
another 50 years. We have young men and women returning from 
war with devastating injuries that most of us could not fathom 
enduring, let alone at such a young age.
    It is a failure of the highest magnitude if we don't 
provide these heroes, who have sacrificed so much for their 
country, with the benefits and services they need and deserve 
to return to a full, active, and productive life.
    Mr. Chairman, I hope we all remember the call to action we 
received last year when problems with the current system were 
publicly exposed at Walter Reed. I want to work with you and 
our colleagues, and I want to work with the veterans groups 
across the country, to answer the call and to finally bring 
about fundamental changes that have been needed for such a long 
time.
    I look forward to the testimony of our witnesses and I 
yield the floor.
    I thank the Chair.
    Chairman Akaka. Thank you very much, Senator Burr.
    Senator Murray, your opening statement, please.

                STATEMENT OF HON. PATTY MURRAY,
                  U.S. SENATOR FROM WASHINGTON

    Senator Murray. Thank you very much, Senator Akaka, Senator 
Burr. I thank you both for holding this really important 
hearing on the recommendations of the Veterans' Disability 
Benefits Commission.
    General Scott, welcome back to the Committee. Let me 
personally tell you how much I appreciate all the time that you 
have spent on this critical issue and acknowledge how much of 
your own energy you've dedicated to this cause. We all really 
appreciate it.
    Also, I want to thank all of the VSOs and welcome them. As 
well, they are going to be sharing their thoughts later on the 
recommendations made by the Veterans' Disability Benefits 
Commission. We thank all of you as well.
    I join all of you in saying Happy New Year. It promises to 
be a very busy 2008 for this Committee. We have a lot of very 
important issues on the front burner, and, clearly, the reform 
of the VA disability system is going to be one of the hottest.
    Over the course of the last year, this Committee and this 
Congress really devoted a great deal of time and effort to 
addressing the critical issues that impact the health and well-
being of our Nation's veterans. I think it's important, as we 
start this year, that we remind ourselves of last year's 
tremendous accomplishments.
    For the first time last year, the cost of caring for 
veterans was factored as a cost of war. $1.8 billion in 
veterans funding was included in the supplemental war spending 
bill and funding was directed to veterans health care benefits, 
construction, and maintenance of our VA facilities.
    We also passed our fiscal year 2008 VA spending bill that 
increased funding by $3.7 billion more than what the President 
requested. That is the largest increase in VA funding in our 
history.
    Mr. Chairman, you also worked hard to pass the Joshua Omvig 
Suicide Prevention Bill and I think that was a tremendous 
accomplishment. It is an issue we have to continue to focus on 
in this Committee.
    We also worked very hard in a bipartisan manner through 
many committees to pass the Wounded Warriors Act as part of a 
defense authorization bill, which will, I hope, improve the 
coordination and care for our servicemembers as they transition 
from DOD into the VA.
    So, we did a lot last year, Mr. Chairman. But, despite 
those accomplishments, there is a lot more to do. Near the top 
of that list is the much needed reform of the VA's disability 
benefit system. I hope today's hearing will allow us to see 
some of the issues clearly and give us an opportunity to dig 
deep into some very important, very complex issues that 
surround the VA disability system and its shortcomings.
    As anyone who has seen the Commission's final report can 
tell you, the Veterans' Disability Benefits Commission has done 
an exhaustive review of the current VA disability system. They 
took nearly three years--heard testimony, conducted numerous 
site visits, and met with hundreds of veterans. They also 
contracted with two well-known organizations to ensure that 
their recommendations were supported by solid data and 
evidence.
    In total, the Commission made 113 recommendations. Many of 
those recommendations do align with the recommendations that 
were made by the Dole-Shalala Commission. However, they differ 
over the treatment of combat and non-combat injuries, support 
for family members of injured veterans, and the need for an 
executive oversight group to ensure that the Commission's 
recommendations are implemented quickly and effectively.
    As the Chairman mentioned, today's hearing is only the 
first in a series that this Committee will hold to better 
understand the issues inherent in reforming the veterans 
disability system.
    Mr. Chairman, I am pleased that we are beginning with this 
issue and are going to focus on it throughout this session. I 
look forward to the witnesses today.
    Mr. Chairman, I do have two other committees meeting at the 
same time today including the Budget, which, obviously, we need 
to do quickly this year. So, I will not be able to stay for 
much of this hearing, but I will be reviewing all the 
testimony. I look forward to working with you as we move 
forward to make sure we take care of the Nation's veterans, and 
I appreciate your work on this.
    Chairman Akaka. Thank you very much, Senator Murray. I want 
to thank you for your work with the Committee. I add my welcome 
to the Committee Members as well and look forward to a good 
year working together.
    Senator Tester, your opening statement, please.

                 STATEMENT OF HON. JON TESTER, 
                   U.S. SENATOR FROM MONTANA

    Senator Tester. Thank you, Mr. Chairman, Ranking Member 
Burr.
    General Scott, welcome back to the Committee. I appreciate 
your service--both in the Army and the Veterans' Disability 
Benefits Commission.
    This is a huge problem. There aren't many subjects that 
make the veterans in the State of Montana more upset than the 
way VA handles benefit claims. The process is too long, too 
confusing, too confrontational.
    It was described to me a week ago today as being similar to 
Chinese mathematics--very difficult to understand, is the way I 
interpreted that.
    We should be worried about fraud because we are talking 
about taxpayer dollars, but it really is not an excuse for how 
too many veterans seem to get treated by the VA when it comes 
to navigating through the benefits maze.
    I have held literally dozens of town hall meetings with 
veterans--exclusively for veterans in Montana--since I got 
elected, and in every one of them I hear comments like, ``when 
you file a benefit claim you just have to expect you're going 
to get denied the first time.'' Or, ``there's an adversarial 
relationship between the VA and the veteran.'' Or, ``the VA is 
trying to outlive me.'' And the list goes on and on and on. 
These are actual comments that are made to me and they're made 
to me at every meeting I've held--dozens of them.
    There are folks who have been injured in service to this 
country. Their lives have been permanently altered--pretty 
severely in some cases--because of their service. The very 
least we can do is do the best job we possibly can in 
respecting them and being responsive to their concerns. In 
particular, I think we need to see two things come out of these 
hearings.
    First of all, we've got to get a better handle on the way 
VA hands out ratings. I understand for the last three years the 
VA Inspector General and the GAO have all been raising red 
flags about the disparity in disability ratings throughout the 
VA. I know this specifically because Montanans are given a 
lower disability rating for medical health claims on average 
than any other state in the country. There is no good reason 
for that except that the rating system is still a bit too 
arbitrary and we need to do better.
    Second, we have to make the benefits process a lot more 
transparent. To give you just one example, we need to know why 
it is that disability claims filed by National Guardsmen are 
more likely to be denied than those claims filed by active 
duty--a 14 percent rejection rate compared to 5 percent.
    We have made some progress in getting more money to the VA 
to hire more claims personnel. That's a good thing. That should 
start to reduce some of the backlog, but we have got to get 
honest. It is almost as if no one told the VA back in 2004-2005 
that there were two wars going on. And I think they were 
completely unprepared for the surge of new veterans, and I 
still think we need to continue to work on that because it is 
unacceptable to me. Too many veterans have waited too long in 
getting the benefits they've earned.
    We have some good recommendations from General Scott and we 
appreciate that. We'll hear more suggestions from the folks on 
the second panel and I want to hear those so we can go to work.
    Unfortunately, I have a hearing I have to go to, too; so, I 
will not be able to stay around. I apologize for that because 
this is a critically important issue for me and 104,000 
Montanans that are veterans living in my state.
    But, I can tell you, there are big problems here. And we 
need to go to work and get it done. I can't do it alone. This 
Committee cannot do it alone. It is going to be with you guys' 
help and us working together that we can solve this problem. 
And it can be solved. There has just got to be a will to do it, 
and I think there is a will in this Committee to do it.
    Thank you, Mr. Chairman.
    Senator Akaka. Thank you very much, Senator Tester.
    Senator Craig, your opening statement, please.

               STATEMENT OF HON. LARRY E. CRAIG, 
                    U.S. SENATOR FROM IDAHO

    Senator Craig. First of all, Mr. Chairman, Members of the 
Committee and staff, Happy New Year. I'm glad to be back and 
that you're moving very, very quickly on an important issue--
especially to you, Mr. Chairman and our Ranking Member, Senator 
Burr--I want to thank you for holding this hearing to examine 
the recommendations of the Veterans' Disability Benefits 
Commission.
    I certainly hope that this hearing lays the groundwork for 
Congress, the veterans service organizations, and the 
administration to update and reform the disability compensation 
system.
    Mr. Chairman, April of last year the Veterans' Affairs 
Committee held a joint hearing with the Armed Services 
Committee to determine how best to address and reform the 
disability compensation system, both within DOD and VA, to 
streamline the process into an easily understood and fair 
system.
    This is a very important issue and it's important that this 
Committee take the steps necessary to begin the process of 
reform. I believe that this Committee has done its due 
diligence in reviewing the different Commission 
recommendations. I wish to thank General Scott, who is with us 
today, and the rest of the Commission for their work.
    That being said, I hope that this Commission, along with 
the work done by the Dole-Shalala Commission, will finally spur 
Congress and the administration to act on the much needed 
reforms that have been identified. We all know this is not a 
new issue. While I have been on this Committee a good number of 
years, it is an issue that keeps coming up, and it is evident 
for the last 50 years that there has been a significant 
problem.
    I have to also ask that if we, the Committee, do not take 
action--based on all of the evidence that's now out there and 
the work that's been done--Mr. Chairman, will it be another 50 
years before we are spurred to do something in the kind of 
meaningful reform that makes it work? And when I talk 50-year 
segments, of course, I am talking about the Omar Bradley 
reviews and the recommendations that were made--that many who 
look at this reflect from and forward--as we look at these kind 
of issues.
    So, this is something that is critically important. 
Overlapping functions, the kind of reform necessary that should 
be, in a much overused word, ``seamless'' between DOD and VA is 
something that I think we have to seriously take a look at.
    I am glad we start the new year, Mr. Chairman, with this 
issue. And I hope this Committee stays on it in the new year--
long enough to produce a quality piece of legislation that 
begins to take two very, very big bureaucracies and force them 
to reform themselves into the modern world--and reflect what 
ought to be reflected on behalf of our men and women who have 
served us well in the armed services and are now entitled to 
programs and services from the Veterans Administration.
    Thank you.
    Chairman Akaka. Thank you very much, Senator Craig.
    I now welcome Lieutenant General Terry Scott, Chairman of 
the Veterans' Disability Benefits Commission. Under General 
Scott's leadership, the Veterans' Disability Benefits 
Commission recently completed an extensive two-year review of 
the benefits and services provided to our disabled veterans by 
the Departments of Defense and Veterans Affairs.
    As I noted earlier, the formal activity of the Commission 
is complete. I thank you again, General Scott, for your 
continuing work on behalf of the Commission.
    General Scott, we're anxious to hear your statement so will 
you please begin.

 STATEMENT OF LIEUTENANT GENERAL JAMES TERRY SCOTT, CHAIRMAN, 
            VETERANS' DISABILITY BENEFITS COMMISSION

    General Scott. Chairman Akaka, Ranking Member Burr and 
members of the Committee, it's a real honor to be here with you 
today to discuss the findings and conclusions of the Veterans' 
Disability Benefits Commission.
    I offer my written statement for the record and, as was 
mentioned, the Commission was created by Public Law 108-136 to 
study the benefits and services that are provided to compensate 
and assist veterans and their survivors for disabilities and 
deaths attributable to military service.
    We were asked to make recommendations concerning three 
things: the appropriateness of such benefits, the 
appropriateness of the level of such benefits, and the 
appropriate standards for determining whether a disability or 
death of a veteran should be compensated.
    As was mentioned, for almost two and one-half years, the 
Commission conducted extensive and comprehensive examination of 
all the issues relating to veterans' disability benefits. We 
made every effort to ensure that our analysis was based on 
evidence and it was data driven.
    We engaged two well-known organizations: the Institute of 
Medicine (IOM) of the National Academies; and the CNA 
Corporation, formally known as the Center for Naval Analysis.
    We examined many issues with some emphasis on the impact of 
disability on quality of life, the VA Rating Schedule, Post 
Traumatic Stress Disorder, individual unemployability, 
presumptions, transition from servicemember to veteran, 
concurrent receipt of retired pay and disability benefits, the 
need for compatible electronic information systems and, as has 
been mentioned several times, claims processing.
    I will address our key conclusions and recommendations on 
each of these topics. Enclosed with the written statement for 
the record is the list of recommendations and the agency that 
the Commission thought should take action on each of these 
recommendations.
    Some of these recommendations are inexpensive. Some are 
not. Some can be adopted by VA or DOD, and/or DOD. Others will 
involve the Department of Labor or the Social Security 
Administration. Many will require legislation.
    We understand that not all recommendations can be adopted 
immediately. We have identified 14 recommendations that, in our 
judgment, are higher priority. We hope that the Congress and 
the departments will carefully consider all recommendations.
    To summarize our findings briefly--VA compensation 
currently paid to disabled veterans is generally adequate to 
offset the average impairment of earnings. A comparison with 
the earnings of veterans who are not service disabled 
demonstrated that disability causes lower earnings and 
employment at all levels of severity and types of disabilities. 
The amount of compensation is generally sufficient to offset 
loss of earnings except for three groups of veterans: those 
whose primary disability is PTSD or other mental disorders; 
those who are severely disabled at a young age; and those who 
are granted maximum benefits because their disabilities make 
them unemployable.
    We also found that some of the special monthly payments, 
and ancillary and special benefits have not been adjusted over 
the years to reflect cost of living changes and to ensure that 
payments are adequate. We recommend these be updated and 
reviewed.
    The Commission particularly focused on the issues 
concerning care for the severely injured such as the amputees 
and those with Traumatic Brain Injury (TBI).
    We also focused on the families of the severely injured 
that are assisting in the care and rehabilitation of these 
wounded warriors. Some are sacrificing jobs, careers, homes, 
and health insurance, and face a tremendous impact on their own 
health in order to support their injured family members. We 
believe Congress should provide some health care and a 
caregiver allowance for these families.
    The VA Rating Schedule: the Commission concluded that the 
current VA Schedule for Rating Disabilities, which is used to 
evaluate veterans' severity of disability, has not been 
adequately revised. IOM found that 47 percent of the codes have 
been revised since 1990 but 35 percent have not been revised 
since 1945. We recommended that the Rating Schedule be updated 
as soon as possible.
    As a matter of priority, this update has got to include 
some specific criteria for the evaluation and rating of 
Traumatic Brain Injury and all mental disorders, especially 
Post Traumatic Stress Disorder. As revised, the Schedule should 
include new diagnostic classifications, up-to-date medical 
criteria, and should reflect medical advances.
    In addition, the VA should create a process for keeping the 
Rating Schedule up to date to include publishing a timetable 
and creating an advisory committee for revising the medical 
criteria for each body system.
    On PTSD, we found that there's been insufficient monitoring 
and coordination between VBA and VHA for veterans experiencing 
PTSD. The Commission believes that a holistic approach to PTSD 
should be established that couples compensation, treatment, and 
vocational assessment. We also believe that reevaluation should 
occur, and our suggestion was every two to three years, to 
gauge treatment effectiveness and to encourage wellness.
    Regarding individual unemployability: as you know, veterans 
with service-connected disabilities rated at 60 percent or 
more, but less than 100 percent, and who are unable to work due 
to their disabilities, can be granted what is known as IU and 
paid at the 100 percent rate.
    The number of such veterans has increased by 90 percent 
over the past few years, creating considerable attention. We 
found that the increase is largely explained by the aging of 
the cohort of Vietnam veterans.
    As the Rating Schedule is revised, specific focus should be 
given to the criteria for PTSD and other mental disorders so 
that IU does not need to be awarded so frequently.
    On the subject of presumptions: when there is evidence that 
a condition is experienced by a sufficient cohort of veterans, 
a presumption can be established so that it is presumed to be 
the result of military service. This has been done for 
radiation exposure, Agent Orange defoliant, and other 
conditions.
    The Commission asked the IOM to review the existing 
processes for making these decisions and IOM recommended a 
detailed, comprehensive, and transparent framework based more 
on scientific principles. Our Commission believes that this 
framework, if adopted, will improve the process. We have some 
concern about the causal effect standard, but we would expect 
that to be addressed in the review.
    On the subject of transition (which we've all talked about 
a lot): we recommended a realignment of the DOD disability 
evaluation process, as was mentioned earlier. We believe that 
the services should determine whether a servicemember is fit 
for duty and VA should determine the level of disability.
    We are aware of the pilot program that's going on and I 
would like to commend the Senior Oversight Committee for the 
job that they are doing in tracking that pilot program.
    We also believe that the DOD should mandate that separation 
examinations be performed on all servicemembers to ensure that 
all known conditions at the time of discharge are documented.
    Regarding concurrent receipt of military retirement and VA 
disability payments: the Commission found these to be two 
different programs with entirely different missions. DOD 
retirement recognizes years of service, and VA disability 
payments compensate for impairment in earnings and should 
compensate for impact on quality of life.
    We believe that payment offsets should also be eliminated 
for survivors of those who die in service or retirees who die 
of service-related causes so that the survivors can receive 
both VA dependency and indemnity compensation and the DOD 
survivors benefit plan.
    We encourage the VA and the DOD to expedite their efforts 
to implement compatible electronic information systems. We 
think this is one of the most important actions that can be 
taken for the long run.
    Claims processing: we studied the existing claims 
processing for disabled veterans and we are disappointed by the 
burdensome bureaucracy and the delays that our veterans face. 
Therefore, we recommend that VA establish a simplified and 
expedited process using best practices and maximal use of 
information technology to improve the claims cycle.
    As was commented, we generally agreed with the advice 
presented by the Dole-Shalala Commission. We differed with two 
of their suggestions. We believe that all disabilities and 
injuries should be compensated based on the severity of the 
disability and not be limited to combat or combat-related 
injuries. Nor does our Commission believe that VA disability 
compensation should end and be replaced with Social Security at 
retirement age.
    For the severely disabled, that would result in a reduction 
in income of somewhere in the neighborhood of 40 percent at a 
time when their failing health would likely require them to 
hire people to do normal things that they were able to do when 
younger.
    As has been mentioned, we believe that, as a matter of 
principle, benefits should be based on the severity of the 
disability, not when or how the disability occurred.
    I believe that I can speak for the entire Commission and 
recommend that all veterans should be provided benefits and 
services consistent with their disabilities. All should be 
evaluated and compensated using the same criteria and not 
establish a different system for veterans of the current 
conflict and those of the future while using a separate system 
for veterans of previous eras. Our concern is that we do not 
think the VA can manage two concurrent systems, given the 
difficulty that the VA has with the one system.
    In conclusion, we are hopeful that if our recommendations 
are implemented, a system for future generations of disabled 
veterans and their families will be established that will 
ensure seamless transition and improve their quality of life. 
It is our hope that the President, the Congress, the VA, and 
the DOD take this opportunity to create a veterans disability 
benefits system that will adapt as the needs of future veterans 
change.
    I speak on behalf of all of the Commissioners when I say it 
has been an honor and a privilege to serve our current and 
future veterans through this effort. During the course of our 
work, we felt the weight of our responsibilities and I think 
each one of us worked a little harder to ensure that we made a 
difference.
    Each member should be thanked for their hard work, 
dedication, and professionalism. It was not an easy assignment 
and the commitment and resolve of these Commissioners was truly 
tremendous.
    And so now, I would be happy to take questions.
    [The prepared statement of General Scott follows:]
  Prepared Statement of James Terry Scott, LTG, USA (Ret.), Chairman, 
                Veterans' Disability Benefits Commission
    Chairman Akaka, Ranking Member Burr, Members of the Committee, I am 
pleased to appear before you today to discuss the findings, 
conclusions, and recommendations of the Veterans' Disability Benefits 
Commission. First, I would like everyone to understand that my 
statements today are my own and do not necessarily represent the views 
of the Commission. The Commission completed its work and submitted its 
report on October 3, 2007.
    The Commission was created by Public Law 108-136 to study the 
benefits and services that are provided to compensate and assist 
veterans and their survivors for disabilities and deaths attributable 
to military service. Specifically, the Commission was tasked to examine 
and make recommendations concerning:

     The appropriateness of such benefits;
     The appropriateness of the level of such benefits; and
     The appropriate standards for determining whether a 
disability or death of a veteran should be compensated.

    Commissioners were appointed by the President and the four leaders 
of Congress.
    For almost two and one-half years, the Commission conducted an 
extensive and comprehensive examination of issues relating to veterans' 
disability benefits. This is the first time that the subject has been 
studied in depth by an outside entity since the Bradley Commission in 
1956. We identified 31 issues for study. We made every effort to ensure 
that our analysis was evidence based and data driven, and we engaged 
two well-known organizations to provide medical expertise and analysis:

     the Institute of Medicine (IOM) of the National Academies, 
and
     the CNA Corporation (CNAC).

    We examined many issues with added emphasis on:

     The impact of disability on Quality of Life
     The VA Rating Schedule
     Post Traumatic Stress Disorder (PTSD)
     Individual Unemployability
     Presumptions
     Transition
     Concurrent Receipt
     Compatible Electronic Information Systems
     Claims Processing

    I will address our key conclusions and recommendations on each of 
those topics.
    We offered 113 recommendations covering a wide spectrum of 
veterans' disability benefits issues to ensure that the benefits fairly 
and uniformly compensate all service-disabled veterans and their 
families. The Commission's recommendations are included in Chapter 11 
of our report. Enclosed with this statement, for the record, is the 
list presented in Chapter 11 that identifies who we thought could take 
action on each recommendation.
    Some recommendations are inexpensive. Some are not. Some can be 
adopted by VA and/or DOD. Other recommendations involve DOL and SSA. 
Others will require legislation. The Commission understands that not 
all recommendations can be adopted immediately. We have identified 14 
recommendations that, in our judgment, are higher priority. We hope the 
Congress and the Departments will carefully consider all 
recommendations.
To summarize our findings
    VA compensation currently paid to disabled veterans is generally 
adequate to offset average impairment of earnings. A comparison with 
the earnings of veterans who are not service disabled demonstrated that 
disability causes lower earnings and employment at all levels of 
severity and types of disabilities. The amount of compensation is 
generally sufficient to offset loss of earnings except for three groups 
of veterans:

     those whose primary disability is PTSD or other mental 
disorders,
     those who are severely disabled at a young age, and
     those who are granted maximum benefits because their 
disabilities make them unemployable.

    We found that some of the special monthly compensation payments, 
and ancillary and special benefits have not been adjusted over the 
years to reflect cost of living changes and to ensure that payments are 
adequate. We recommended that these be updated and reviewed.
    The Commission particularly focused on the issues concerning care 
for the severely injured such as amputees and those with Traumatic 
Brain Injury or TBI. Due to improvements in the armor our Services 
provide and the advances in military medicine, servicemembers are 
surviving from wounds that, in the past, they died from. In many ways, 
we have not demonstrated that we are prepared to provide adequate care 
and support for these veterans.
    We received moving testimony concerning the experience of amputees 
and other severely disabled veterans undergoing treatment, multiple 
fittings, and lengthy training to use prostheses and we recommend that 
those with severe disabilities be provided a pre-stabilization 
allowance of up to 50 percent of compensation for up to 5 years.
    The families of the severely injured are assisting in the care and 
rehabilitation of these wounded warriors. Some are sacrificing jobs, 
careers, homes, and health insurance, and facing a tremendous impact on 
their own health in order to support their injured family member(s). 
Congress should provide health care and a caregiver allowance for these 
families.
                impact of disability on quality of life
     We believe the level of compensation should be based on 
the severity of disability and should make up for average impairment of 
earnings capacity and the impact of disability on functionality and 
quality of life. It should not be based on whether the disability 
occurred during combat or combat training, or the geographic location 
of injury, or whether the disability occurred during wartime or a time 
of peace.
     Current compensation payments do not provide payment above 
that required to offset earnings loss. Therefore, there is currently no 
compensation for the impact of disability on quality of life for most 
veterans.
     While permanent quality of life measures are developed and 
implemented, current compensation payments should be increased up to 25 
percent with priority to the more seriously disabled.
                         the va rating schedule
     The Commission concluded that the current VA Schedule for 
Rating Disabilities which is used to evaluate veterans' severity of 
disability has not been adequately revised. IOM found that 47 percent 
of codes have been revised since 1990 but 35 percent have not been 
revised since 1945. We recommend that the Rating Schedule be updated as 
soon as possible but certainly within the next 5 years.
     As a matter of priority, this update must include specific 
criteria for the evaluation and rating of Traumatic Brain Injury (TBI) 
and all mental disorders, especially Post Traumatic Stress Disorder 
(PTSD). As it is revised, the schedule should include new diagnostic 
classifications, up-to-date medical criteria, and reflect medical 
advances.
     In addition, the VA should create a process for keeping 
the Rating Schedule up to date, including publishing a timetable, and 
creating an advisory committee for revising the medical criteria for 
each body system.
                                  ptsd
     We found that there is insufficient monitoring and 
coordination between VBA and VHA for veterans experiencing PTSD. An 
October 2007 IOM report on PTSD treatment (not reflected in our report) 
found that there is not even an agreed-upon definition of recovery and 
that there is not sufficient evidence of the efficacy of treatment 
modalities and pharmaceuticals.
     Although there has been a lot of discussion about the 
extent that OEF and OIF servicemembers experience PTSD, we noted that 
only some 1,400 servicemembers had been found unfit for duty due to 
PTSD out of some 83,000 over the past 7 years. This does not indicate 
that sufficient attention is being paid to this disorder.
     The Commission believes that a holistic approach to PTSD 
should be established that couples compensation, treatment, and 
vocational assessment. We also believe that reevaluation should occur 
every two to three years to gauge treatment effectiveness and encourage 
wellness.
                    individual unemployability (iu)
     Veterans with service-connected disabilities rated 60 
percent or more but less than 100 percent and who are unable to work 
due to their disabilities can be granted what is known as IU and be 
paid at the 100 percent rate. The number of such veterans has increased 
by 90 percent over the past few years causing considerable attention. 
We found that the increase is largely explained by the aging of the 
cohort of Vietnam veterans.
     As the Rating Schedule is revised, specific focus should 
be given to the criteria for PTSD and other mental disorders so that IU 
does not need to be awarded so frequently. Currently, 31 percent of 
veterans with a primary disability of PTSD are awarded IU. Since 
incapacity to work is part of the criteria for a rating of 100 percent 
for PTSD and other mental disorders, it is not clear why many of these 
veterans are not rated 100 percent instead of IU.
                              presumptions
     When there is evidence that a condition is experienced by 
a sufficient cohort of veterans, a ``presumption'' can be established 
so that it is presumed to be the result of military service. This has 
been done for radiation exposure, Agent Orange defoliant in Vietnam, 
and other conditions. The Commission asked the IOM to review the 
existing processes for making these decisions and IOM recommended a 
detailed, comprehensive, and transparent framework based more on 
scientific principles. Our Commission believes that this framework will 
improve the process but expresses concern over the causal effect 
standard that would be included instead of the existing standard for an 
association.
                               transition
     The Commission recommends a realignment of the DOD 
disability evaluation process used to separate or retire servicemembers 
who are not fit for military duty. The Military Services (Army, Navy, 
and Air Force) should determine whether a servicemember is fit for duty 
and VA should determine the level of disability of servicemembers who 
are found unfit for duty. This will ensure equitable and consistent 
ratings.
     We also believe that DOD should mandate that separation 
examinations be performed on all servicemembers to ensure that all 
known conditions at the time of discharge are documented.
                           concurrent receipt
     Regarding concurrent receipt of military retirement and VA 
disability payments, the Commission found these to be two different 
programs with entirely different missions. DOD retirement recognizes 
years of service and VA disability payments compensate for impairment 
in earnings and should compensate for impact on quality of life.
     Over time, Congress should eliminate the ban on concurrent 
receipt for all military retirees and for all servicemembers who are 
separated from the military due to service-connected disabilities. 
Priority should be given to veterans who separate or retire with less 
than 20 years of service and a service-connected disability rating 
greater than 50 percent or disability as a result of combat.
     Payment offset should also be eliminated for survivors of 
those who die in service or retirees who die of service-related causes 
so that the survivors can receive both VA Dependency and Indemnity 
Compensation and DOD Survivors Benefit Plan.
               compatible electronic information systems
     VA and DOD should expedite their efforts to implement 
compatible electronic information systems. We believe this is one the 
most important actions that can be taken. Not only will this improve 
claims processing but it will enhance the ability to share medical 
records and avoid some of the unfortunate cases that ``slip though the 
cracks'' during the transition from VA to DOD.
     On this note, the Commission encourages VA and DOD to work 
together more often. Joint ventures, sharing agreements, and 
integration should be the norm, not the exception.
                           claims processing
     The Commission studied the existing claims processing for 
disabled veterans and was disappointed by the burdensome bureaucracy 
and delays that our veterans face. Therefore, we recommend that VA 
establish a simplified and expedited process using best practices and 
maximum use of information technology to improve the claims cycle.
     the dole-shalala commission and the administration's proposed 
                              legislation
    Our Commission generally agrees with the advice presented by the 
Dole-Shalala Commission, but we differ with two of their suggestions. 
We believe that all disabilities and injuries should be compensated 
based on severity of disability and not be limited to combat or combat-
related injuries. From 1932 to 1972, compensation was paid at lower 
rates for peacetime vs. wartime injuries. In 1965, VA concluded that it 
could not justify paying different rates. We think the same principle 
applies to trying to distinguish between combat-related injuries and 
others. Regardless of how combat or combat-related activities are 
defined, deciding each case would require judgment and subjectivity on 
the part of VA rating officials and introduce a new level of complexity 
to what everyone agrees is already an overly complex process. The 
current policy requires a court martial determination of misconduct to 
make someone ineligible and we think that is the proper level of 
decision.
    Nor does our Commission believe that VA disability compensation 
should end and be replaced with Social Security at retirement age. For 
the severely disabled, that would result in a reduction in income of 
somewhere in the neighborhood of 40 percent at a time when their 
failing health will likely require them to hire people to do normal 
things that they were able to do when younger.
    Our Commission's recommendations are in many ways similar to the 
intent of the Administration's proposed legislation but we recommended 
stronger support for the families of those severely disabled and we 
would not restrict benefits such as family health care to those with 
serious injuries experienced in combat or combat-related circumstances. 
There is currently no commonly accepted or used definition for serious 
injuries but I feel that the definition proposed in the 
Administration's proposal is too stringent. It is not clear to me that 
all veterans currently rated 100 percent would meet that proposed 
definition. In our review of those discharged as unfit from 2000 
through 2006, only about 1,500 of 83,000 were rated by DOD as 100 
percent disabled and only 5,000 were rated as 50 percent or higher.
    We believe as a matter of principle that benefits should be based 
on the severity of disability, not on when or how the disability 
occurred.
    I believe that I can speak for the entire Commission and recommend 
that all veterans should be provided benefits and services consistent 
with their disabilities. All should be evaluated and compensated using 
the same criteria and not establish a different system for veterans of 
the current conflict and those of the future while using a separate 
system for veterans of previous eras.
    I reviewed the provisions of the National Defense Authorization Act 
for 2009 and noted that it does not limit the process to combat or 
combat-related disabilities and defines serious disabilities as those 
injuries that may make a servicemember unfit for duty. I am personally 
very glad to see this.
In conclusion
     The Commission believes that if our recommendations are 
implemented, a system for future generations of disabled veterans and 
their families will be established that will ensure seamless transition 
and improve their quality of life. It is our hope that the President, 
Congress, VA, and DOD take this opportunity to create a veterans 
disability benefits system that will adapt as the needs of future 
veterans change.
     I speak on behalf of all of the commissioners when I say 
it has been an honor and a privilege to serve our current and future 
veterans through this effort. During the course of our work, we felt 
the weight of our responsibility and I believe each one of us worked a 
little harder to ensure we made a difference.
     Each member should be thanked for their hard work, 
dedication, and professionalism. This was not an easy assignment--their 
commitment and resolve was true to the end.
    And now I would be glad to take questions.

    Enclosure.
                                 ______
                                 
                               Attachment

                    The Commission's Recommendations
------------------------------------------------------------------------
Number \1\              Recommendation                  Actionable By
------------------------------------------------------------------------
                                CHAPTER 4

     4.1    The purpose of the current veterans     Congress
             disability compensation program as
             stated in statute currently is to
             compensate for average impairment in
             earning capacity, that is work
             disability. This is an unduly
             restrictive rationale for the program
             and is inconsistent with current
             models of disability. The veterans
             disability compensation program
             should compensate for three
             consequences of service-connected
             injuries and diseases: work
             disability, loss of ability to engage
             in usual life activities other than
             work, and loss in quality of life.
             (Specific recommendations on
             approaches to evaluating each
             consequence of service-connected
             injuries and diseases are in ``A 21st
             Century System for Evaluating
             Veterans for Disability Benefits,''
             Chapter 4.) [IOM Rec. 3-1]
\1\ Stars
 denote
 the
 highest-
 priority
 recommend
 ations,
 as
 described
 in the
 Executive
 Summary.
     4.2    VA should compensate for nonwork        Congress
             disability, defined as functional
             limitations on usual life activities,
             to the extent that the Rating
             Schedule does not, either by
             modifying the Rating Schedule
             criteria to take account of the
             degree of functional limitation or by
             developing a separate mechanism. [IOM
             Rec. 4-5]
     4.3    VA should determine the feasibility of  VA
             compensating for loss of quality of
             life by developing a tool for
             measuring quality of life validly and
             reliably in the veteran population,
             conducting research on the extent to
             which the Rating Schedule already
             accounts for loss in quality of life,
             and, if it does not, developing a
             procedure for evaluating and rating
             loss of quality of life in veterans
             with disabilities. [IOM Rec. 4-6]
     4.4    VA should develop a process for         VA
             periodic updating of the disability
             examination worksheets. This process
             should be part of, or closely linked
             to, the process recommended above for
             updating and revising the Schedule
             for Rating Disabilities. There should
             be input from the disability
             committee recommended above (see IOM
             Rec. 4-1). [IOM Rec. 5-1]
     4.5    VA should mandate the use of the        VA
             online templates that have been
             developed for conducting and
             reporting disability examinations.
             [IOM Rec. 5-2]
     4.6    VA should establish a recurring         VA
             assessment of the substantive quality
             and consistency, or inter-rater
             reliability, of examinations
             performed with the templates and, if
             the assessment finds problems, take
             steps to improve quality and
             consistency, such as revising the
             templates, changing the training, or
             adjusting the performance standards
             for examiners. [IOM Rec. 5-3]
     4.7    The rating process should have built-   VA
             in checks or periodic evaluations to
             ensure inter-rater reliability as
             well as the accuracy and validity of
             rating across impairment categories,
             ratings, and regions. [IOM Rec. 5-4]
     4.8    VA raters should have ready access to   VA
             qualified health care experts who can
             provide advice on medical and
             psychological issues that arise
             during the rating process (e.g.,
             interpreting evidence or assessing
             the need for additional examinations
             or diagnostic tests). [IOM Rec. 5-5]
     4.9    Educational and training programs for   VA
             VBA raters and VHA examiners should
             be developed, mandated, and uniformly
             implemented across all regional
             offices with standardized performance
             objectives and outcomes. These
             programs should make use of advances
             in adult education techniques.
             External consultants should serve as
             advisors to assist in the development
             and evaluation of the educational and
             training programs. [IOM Rec. 5-6]
     4.10   VA and the Department of Defense        VA and DOD
             should conduct a comprehensive
             multidisciplinary medical,
             psychological, and vocational
             evaluation of each veteran applying
             for disability compensation at the
             time of service separation. [IOM Rec.
             6-1]
     4.11   VA should sponsor research on           VA
             ancillary benefits and obtain input
             from veterans about their needs. Such
             research could include conducting
             intervention trials to determine the
             effectiveness of ancillary services
             in terms of increased functional
             capacity and enhanced health-related
             quality of life. [IOM Rec. 6-2]
     4.12   The concept underlying the extant 12-   VA
             year limitation for vocational
             rehabilitation for service-connected
             veterans should be reviewed and, when
             appropriate, revised on the basis of
             current employment data, functional
             requirements, and individual
             vocational rehabilitation and medical
             needs. [IOM Rec. 6-3]
     4.13   VA should develop and test incentive    VA
             models that would promote vocational
             rehabilitation and return to gainful
             employment among veterans for whom
             this is a realistic goal. [IOM Rec. 6-
             4]
     4.14   In addition to medical evaluations by   Congress and VA
             medical professionals, VA should
             require vocational assessment in the
             determination of eligibility for
             Individual Unemployability (IU)
             benefits. Raters should receive
             training on how to interpret findings
             from vocational assessments for the
             evaluation of IU claims. [IOM Rec. 7-
             1]
     4.15   VA should monitor and evaluate trends   VA
             in its disability program and conduct
             research on employment among veterans
             with disabilities. [IOM Rec. 7-2]
     4.16   VA should conduct research on the       VA
             earnings histories of veterans who
             initially applied for Individual
             Unemployability benefits past the
             normal age of retirement under the
             Old Age, Survivors, and Disability
             Insurance Program under the Social
             Security Act. [IOM Rec. 7-3]
     4.17   Eligibility for Individual              VA
             Unemployability should be based on
             the impact of an individual's service-
             connected disabilities, in
             combination with education,
             employment history, and the medical
             effects of that individual's age on
             his or her potential employability.
             [IOM Rec. 7-4]
     4.18   VA should implement a gradual           VA
             reduction in compensation to
             recipients of Individual
             Unemployability benefits who are able
             to return to substantial gainful
             employment rather than abruptly
             terminate their disability payments
             at an arbitrary level of earnings.
             [IOM Rec. 7-5]
     4.19   VA should adopt a new classification    VA
             system using the ``International
             Classification of Disease'' (ICD) and
             the ``Diagnostic and Statistical
             Manual of Mental Disorders'' (DSM)
             codes. This system should apply to
             all applications, including those
             that are denied. During the
             transition to ICD and DSM codes, VA
             can continue to use its own
             diagnostic codes, and subsequently
             track and analyze them comparatively
             for trends affecting veterans and for
             program planning purposes. Knowledge
             of an applicant's ICD or DSM codes
             should help raters, especially with
             the task of properly categorizing
             conditions. [IOM Rec. 8-1]
     4.20   Considering some of the unique          VA
             conditions relevant for disability
             following military activities, it
             would be preferable for VA to update
             and improve the Rating Schedule on a
             regular basis rather than adopt an
             impairment schedule developed for
             other purposes. [IOM Rec. 8-2]
     4.21   VA should seek the judgment of          VA
             qualified experts, supported by
             findings from current peer-reviewed
             literature, as guidance for
             adjudicating both aggravation of
             preservice disability and Allen
             aggravation claims. Judgment could be
             provided by VHA examiners, perhaps
             from VA centers of excellence, who
             have the appropriate expertise for
             evaluating the condition(s) in
             question in individual claims. [IOM
             Rec. 9-1]
     4.22   VA should guide clinical evaluation     VA
             and rating of claims for secondary
             service connection by adopting
             specific criteria for determining
             causation, such as those cited above
             (e.g., temporal relationship,
             consistency of research findings,
             strength of association, specificity,
             plausible biological mechanism). VA
             should also provide and regularly
             update information to compensation
             and pension examiners about the
             findings of epidemiological,
             biostatistical, and disease mechanism
             research concerning the secondary
             consequences of disabilities
             prevalent among veterans. [IOM Rec. 9-
             2]
    *4.23   VA should immediately begin to update   VA
             the current Rating Schedule,
             beginning with those body systems
             addressing the evaluation and rating
             of Post Traumatic Stress Disorder,
             other mental disorders, and Traumatic
             Brain Injury. Then proceed through
             the other body systems until the
             Rating Schedule has been
             comprehensively revised. The revision
             process should be completed within 5
             years. VA should create a system for
             keeping the Rating Schedule up to
             date, including a published schedule
             for revising each body system.
 
                                CHAPTER 5
 
     5.1    Congress should change the character-   Congress
             of-discharge standard to require that
             when an individual is discharged from
             his or her last period of active
             service with a bad conduct or
             dishonorable discharge, it bars all
             benefits.
     5.2    Maintain the present definition of      No action required
             line of duty: that servicemembers are
             on duty 24 hours a day, 7 days a
             week.
     5.3    Benefits should be awarded at the same  No action required
             level according to the severity of
             the disability, regardless of whether
             the injury was incurred or disease
             was contracted during combat or
             training, wartime or peacetime.
     5.4    Maintain the current reasonable doubt   No action required
             standard.
     5.5    Age should not be a factor for rating   No action required
             service connection or severity of
             disability, but may be a
             consideration in setting compensation
             rates.
     5.6    Maintain the current standard of an     No action required
             unlimited time limit for filing an
             original claim for service
             connection.
     5.7    DOD should require a mandatory          DOD
             benefits briefing to all separating
             military personnel, including Reserve
             and National Guard components, prior
             to discharge from service.
     5.8    Congress should create a formal         Congress and VA
             advisory committee (Advisory
             Committee) to the VA to consider and
             advise the Secretary of VA on
             disability-related questions
             requiring scientific research and
             review to assist in the consideration
             of possible presumptions. [IOM Rec.
             1]
     5.9    Congress should authorize a permanent   Congress
             independent review body (Science
             Review Board) operating with a well-
             defined process that will use
             evaluation criteria as outlined in
             this committee's recommendations to
             evaluate scientific evidence for VA's
             use in considering future service-
             connected presumptions. [IOM Rec. 2]
     5.10   VA should develop and publish a formal  VA
             process for consideration of
             disability presumptions that is
             uniform and transparent and that
             clearly sets forth all evidence
             considered and the reasons for
             decisions reached. [IOM Rec. 3]
     5.11   The goal of the presumptive disability  Congress
             decision-making process should be to
             ensure compensation for veterans
             whose diseases are caused by military
             service and this goal must serve as
             the foundation for the work of the
             Science Review Board. The committee
             recommends that the Science Review
             Board implement its proposed two-step
             process. [IOM Rec. 4]
     5.12   The Science Review Board should use     Congress
             the proposed four-level
             classification scheme, as follows, in
             the first step of its evaluation. A
             standard should be adopted for
             ``causal effect'' such that if there
             is at least as much evidence in favor
             of the exposure having a causal
             effect on the severity or frequency
             of disease as there is evidence
             against, then a service-connected
             presumption will be considered. [IOM
             Rec. 5]
             Sufficient: The evidence is
             sufficient to conclude that a causal
             relationship exists.
             Equipoise and Above: The
             evidence is sufficient to conclude
             that a causal relationship is at
             least as likely as not, but not
             sufficient to conclude that a causal
             relationship exists.
             Below Equipoise: The evidence
             is not sufficient to conclude that a
             causal relationship is at least as
             likely as not, or is not sufficient
             to make a scientifically informed
             judgment.
             Against: The evidence
             suggests the lack of a causal
             relationship.
     5.13   A broad spectrum of evidence,           VA
             including epidemiologic, animal, and
             mechanistic data, should be
             considered when evaluating causation.
             [IOM Rec. 6]
     5.14   When the causal evidence is at          Congress
             Equipoise and Above, an estimate also
             should be made of the size of the
             causal effect among those exposed.
             [IOM Rec. 7]
     5.15   The relative risk and exposure          VA
             prevalence should be used to estimate
             an attributable fraction for the
             disease in the military setting
             (i.e., service attributable
             fraction). [IOM Rec. 8]
     5.16   Inventory research related to the       VA
             health of veterans, including
             research funded by DOD and VA and
             research funded by the National
             Institutes of Health and other
             organizations. [IOM Rec. 9]
     5.17   Develop a strategic plan for research   VA
             on the health of veterans,
             particularly those returning from
             conflicts in the gulf and
             Afghanistan. [IOM Rec. 10]
     5.18   Develop a plan for augmenting research  VA and DOD
             capability within DOD and VA to more
             systematically generate evidence on
             the health of veterans. [IOM Rec. 11]
     5.19   Assess the potential for enhancing      VA and DOD
             research through record linkage using
             the DOD and VA administrative and
             health record databases. [IOM Rec.
             12]
     5.20   Conduct a critical evaluation of gulf   DOD
             war troop tracking and environmental
             exposure monitoring data so that
             improvements can be made in this key
             DOD strategy for characterizing
             exposures during deployment. [IOM
             Rec. 13]
     5.21   Establish registries of servicemembers  VA and DOD
             and veterans based on exposure,
             deployment, and disease histories.
             [IOM Rec. 14]
     5.22   Develop a plan for an overall           DOD
             integrated surveillance strategy for
             the health of servicemembers and
             veterans. [IOM Rec. 15]
     5.23   Improve the data linkage between the    VA and DOD
             electronic health record data systems
             used by DOD and VA--including
             capabilities for handling individual
             soldier exposure information that is
             included as part of the individual's
             health record. [IOM Rec. 16]
     5.24   Ensure implementation of the DOD        DOD
             strategy for improved exposure
             assessment and exposure data
             collection. [IOM Rec. 17]
     5.25   Develop a data interface that allows    VA and DOD
             VA to access the electronic exposure
             data systems used by DOD. [IOM Rec.
             18]
     5.26   DOD and VA should establish and         VA and DOD
             implement mechanisms to identify,
             monitor, track, and medically treat
             individuals involved in research and
             other activities that have been
             classified and are secret. [IOM Rec.
             19]
     5.27   VA should consider environmental        VA
             issues such as blue water Navy and
             Agent Orange, Ft. McClellan and
             polychlorinated biphenyls, and Camp
             Lejeune and trichloroethylene/
             tetrachloroethylene in the new
             presumptions framework.
    *5.28   VA should develop and implement new     VA
             criteria specific to Post Traumatic
             Stress Disorder in the VA Schedule
             for Rating Disabilities. Base those
             criteria on the ``Diagnostic and
             Statistical Manual of Mental
             Disorders'' and consider a
             multidimensional framework for
             characterizing disability caused by
             Post Traumatic Stress Disorder.
     5.29   VA should consider a baseline level of  VA
             benefits described by the Institute
             of Medicine to include health care as
             an incentive for recovery for Post
             Traumatic Stress Disorder as it
             relapses and remits.
    *5.30   VA should establish a holistic          Congress and VA
             approach that couples Post Traumatic
             Stress Disorder treatment,
             compensation, and vocational
             assessment. Reevaluation should occur
             every 2-3 years to gauge treatment
             effectiveness and encourage wellness.
     5.31   The Post Traumatic Stress Disorder      VA and DOD
             exam process:
             Psychological testing should
             be conducted at the discretion of the
             examining clinician.
             VA should identify and
             implement an appropriate replacement
             for the Global Assessment of
             Functioning.
            Post Traumatic Stress Disorder data
             collection and research:
             VA should conduct more
             detailed research on military sexual
             assault and PTSD and develop and
             disseminate reference materials for
             raters.
     5.32   A national standardized training        VA
             program should be developed for VA
             and VA-contracted clinicians who
             conduct compensation and pension
             psychiatric evaluations. This
             training program should emphasize
             diagnostic criteria for Post
             Traumatic Stress Disorder and
             comorbid conditions with overlapping
             symptoms, as set forth in the
             ``Diagnostic and Statistical Manual
             of Mental Disorders.''
     5.33   VA should establish a certification     VA
             program for raters who deal with
             claims for Post Traumatic Stress
             Disorder (PTSD), as well as provide
             training to support the certification
             program and periodic recertification.
             PTSD certification requirements
             should be regularly reviewed and
             updated to include medical advances
             and to reflect lessons learned. The
             program should provide specialized
             training on the psychological and
             medical issues (including
             comorbidities) that characterize the
             claimant population, and give
             guidance on how to appropriately
             manage commonly encountered rating
             problems.

                               CHAPTER 6

     6.1    Congress should consider increasing     Congress
             special monthly compensation where
             appropriate to address the more
             profound impact on quality of life by
             the disabilities subject to special
             monthly compensation and review
             ancillary benefits to determine where
             additional benefits could improve
             disabled veterans' quality of life.
     6.2    The amount of payment for aid and       Congress
             attendance should be adjusted to
             fully pay for the extent of
             assistance required.
     6.3    Extend aid and attendance to severely   Congress
             injured active-duty servicemembers
             who are in a status pending
             discharge.
     6.4    The automotive and housing adaptation   Congress
             benefit should be modified to cover
             service-connected veterans who need
             this assistance and are not currently
             eligible--for example, severe burn
             victims.
     6.5    Provisions should be made to            Congress
             accommodate changing life
             circumstances by allowing a specially
             adapted housing grant at least twice.
     6.6    Eliminate the premium paid by           Congress
             servicemembers for Traumatic
             Servicemembers' Group Life Insurance.
     6.7    The maximum amount of coverage should   Congress
             be increased and up-to-date mortality
             rates should be used to calculate
             premiums for Service-Disabled
             Veterans' Insurance.
     6.8    Expand eligibility for the Veterans'    Congress
             Mortgage Life Insurance to include
             servicemembers of the Armed Forces
             who have received housing
             modification grant assistance from VA
             for severely disabling conditions.
     6.9    Access to vocational rehabilitation     Congress
             should be expanded to all medically
             separated servicemembers.
     6.10   All service disabled veterans should    Congress
             have access to vocational
             rehabilitation and employment
             counseling services.
     6.11   All applicants for Individual           Congress
             Unemployability should be screened
             for employability by vocational
             rehabilitation and employment
             counselors.
     6.12   The administration of the Vocational    VA
             Rehabilitation and Employment Program
             should be enhanced by increased
             staffing and resources, tracking
             employment success beyond 60 days,
             and conducting satisfaction surveys
             of participants and employers.
     6.13   VA should explore incentives that       VA
             would encourage disabled veterans to
             complete their rehabilitation plan.
    *6.14   Congress should eliminate the ban on    Congress
             concurrent receipt for all military
             retirees and for all servicemembers
             who separated from the military
             because of service-connected
             disabilities. In the future, priority
             should be given to veterans who
             separated or retired from the
             military under chapter 61 with--
             fewer than 20 years service
             and a service-connected disability
             rating greater than 50 percent, or
             disability as a result of
             combat.

                                CHAPTER 7

     7.1    Congress should authorize VA to revise  Congress
             the existing payment scale based on
             age at date of initial claim and
             based on degree of severity for
             severely disabled veterans.
     7.2    Congress should adjust VA compensation  Congress
             levels for all disabled veterans
             using the best available data,
             surveys, and analysis in order to
             achieve fair and equitable levels of
             income compared to the nondisabled
             veteran.
     7.3    VA and DOD should be directed to        Congress
             collect and study appropriate data,
             with due restrictions to ensure
             privacy. These agencies should be
             granted statutory authority to obtain
             appropriate data from the Social
             Security Administration and the
             Office of Personnel Management only
             for the purpose of periodically
             assessing appropriate benefits
             delivery program outcomes.
    *7.4    Eligibility for Individual              VA
             Unemployability (IU) should be
             consistently based on the impact of
             an individual's service-connected
             disabilities, in combination with
             education, employment history, and
             medical effects of an individual's
             age or potential employability. VA
             should implement a periodic and
             comprehensive evaluation of veterans
             eligible for IU eligible. When
             appropriate, compensation should be
             gradually reduced for IU recipients
             who are able to return to
             substantially gainful employment
             rather than abruptly terminating
             disability payments at an arbitrary
             level of earning.
    *7.5    Recognizing that Individual             VA
             Unemployability (IU) is an attempt to
             accommodate individuals with multiple
             lesser ratings but who remain unable
             to work, the Commission recommends
             that as the Schedule for Rating
             Disabilities is revised, every effort
             should be made to accommodate such
             individuals fairly within the basic
             rating system without the need for an
             IU rating.
    *7.6    Congress should increase the            Congress
             compensation rates up to 25 percent
             as an interim and baseline future
             benefit for loss of quality of life,
             pending development and
             implementation of a quality-of-life
             measure in the Rating Schedule. In
             particular, the measure should take
             into account the quality of life and
             other non-work-related effects of
             severe disabilities on veterans and
             family members.
     7.7    Congress should create a severely       Congress
             disabled stabilization allowance that
             would allow for up to a 50 percent
             increase in basic monthly
             compensation for up to 5 years to
             address the real out-of-pocket costs
             above the compensation rate at a time
             of need. This would supplement to the
             extent appropriate any coverage under
             Traumatic Servicemembers' Group Life
             Insurance.
    *7.8    Congress should consider increasing     Congress
             special monthly compensation, where
             appropriate, to address the more
             profound impact on quality of life of
             the disabilities subject to special
             monthly compensation. Congress should
             also review ancillary benefits to
             determine where additional benefits
             could improve disabled veterans'
             quality of life.
     7.9    DOD should reassess the policy of       DOD
             allowing separation without
             compensation for individuals found
             unfit for duty who are also found to
             have a preexisting disability for up
             to 8 years of active duty.
     7.10   VA and DOD should adopt a consistent    VA and DOD
             and uniform policy for rating
             disabilities using the VA Schedule
             for Rating Disabilities.
     7.11   DOD should reassess the ratings of      DOD
             servicemembers who were discharged as
             unfit but rated 0 to 30 percent
             disabled to determine if those
             ratings were equitable. (Note:
             Commission data only went back to
             2000.)
    *7.12   VA and DOD should realign the           Congress, VA, and
             disability evaluation process so that   DOD
             the services determine fitness for
             duty, and servicemembers who are
             found unfit are referred to VA for
             disability rating. All conditions
             that are identified as part of a
             single, comprehensive medical
             examination should be rated and
             compensated.
    *7.13   Congress should enact legislation that  Congress
             would bring the ancillary and special-
             purpose benefits to the levels
             originally intended considering cost
             of living and provide for automatic
             annual adjustments to keep pace with
             cost of living.
     7.14   VA disability benefits (including       Congress
             Traumatic Servicemembers' Group Life
             Insurance), except VA compensation
             benefits received in lieu of military
             retired pay, should not be considered
             in state court spousal support
             proceedings.
     7.15   Lump sum payments should not be         No action required
             considered to compensate veterans for
             their disabilities.

                                CHAPTER 8

     8.1    Congress should extend eligibility for  Congress
             the Civilian Health and Medical
             Program of the Department of Veterans
             Affairs to caregivers and create a
             ``caregiver allowance'' for
             caregivers of severely disabled
             veterans.
    *8.2    Congress should eliminate the Survivor  Congress
             Benefit Plan/Dependency and Indemnity
             Compensation offset for survivors of
             retirees and in-service deaths.
     8.3    Allow the veteran's survivors, but not  Congress
             a creditor, to pursue the veteran's
             due but unpaid benefits and any
             additional benefits by continuing the
             claim that was pending when the
             veteran died, including presenting
             new evidence not in VA's possession
             at the time of death.

                                CHAPTER 9

    *9.1    Improve claims cycle time by:           Congress
             establishing a simplified and  and VA
             expedited process for well-documented
             claims, using best business practices
             and maximum feasible use of
             information technology; and
             implementing an expedited
             process by which the claimant can
             state that the claim information is
             complete and waive the time period
             (60 days) allowed for further
             development.
            Congress should mandate and provide
             appropriate resources to reduce the
             VA claims backlog by 50 percent
             within 2 years.
     9.2    Change the commencement date for the    Congress
             period of payment to the effective
             date of the award. (See also
             Recommendation 10.7)
     9.3    Reduce the appellate workload by        VA
             focusing on improved accuracy in the
             initial decision-making process,
             enhance the appeals process by
             ensuring adequate resources to
             dispose of existing workload on a
             timely basis, and deploy technology
             for transferring electronic records
             between field offices and the Board
             of Veterans Appeals.
     9.4    VA should review the current duty to    VA
             assist process and develop policy,
             procedures, and communications that
             ensure they are efficient and
             effective from the perspective of the
             veteran. VA should consider amending
             Veterans Claims Assistance Act
             letters by including all claim-
             specific information to be shown on
             the first page and all other legal
             requirements would be reflected,
             either on a separate form or on
             subsequent pages. In particular, VA
             should use plain language in stating
             how the claimant can request an early
             decision in his or her case.
     9.5    VBA regional office staff must receive  Congress and VA
             adequate education and training.
             Quality reviews should be performed
             to ensure these frontline workers are
             well versed to rate claims. Adequate
             resources must be appropriated to
             hire and train these workers to
             achieve a manageable claims backlog.

                               CHAPTER 10

    10.1    VA and DOD should enhance the Joint     VA and DOD
             Executive Council's strategic plan by
             including specific milestones and
             designating an official to be
             responsible for ensuring that the
             milestones are reached.
    10.2    The Department of Labor and the Social  VA and DOD
             Security Administration should be
             included in the Joint Executive
             Council to improve the transition
             process.
    10.3    VA and DOD should jointly create an     VA and DOD
             intensive case management program for
             severely disabled veterans with an
             identifiable lead agent.
    10.4    To facilitate seamless transition,      Congress
             Congress should adequately fund and
             mandate the Transition Assistance
             Program throughout the military to
             ensure that all servicemembers are
             knowledgeable about benefits before
             leaving the service.
    10.5    Benefits Delivery at Discharge should   VA and DOD
             be available to all disabled
             separating servicemembers (to include
             National Guard, Reserve, and medical
             hold patients).
    10.6    DOD should mandate that separation      DOD
             examinations be performed on all
             servicemembers.
    10.7    Disability payments should be paid      Congress
             from the date of claim.
    10.8    DOD should expand existing programs     DOD
             that translate military occupational
             skills, experience, and certification
             to civilian employment.
    10.9    DOD should provide an authenticated     DOD
             electronic DD-214 to VA.
    10.10   VA and DOD should improve electronic    VA and DOD
             information record transfers and
             address issues of lost, missing, and
             unassociated paper records.
   *10.11   VA and DOD should expedite development  VA and DOD
             and implementation of compatible
             information systems including a
             detailed project management plan that
             includes specific milestones and lead
             agency assignment.
    10.12   Congress should authorize and fund VA   Congress
             to establish and provide support
             services for the families of severely
             injured veterans similar to those
             provided by DOD.
    10.13   DOD should standardize the definition   VA and DOD
             of the term ``severely injured''
             among the services and with VA, and
             create a common database of severely
             disabled servicemembers.
    10.14   DOD should consider the findings of     DOD
             the Severely Injured Marines and
             Sailors Program and the Army Wounded
             Warrior Survey.
    10.15   DOD and VA should make transitioning    VA and DOD
             servicemembers aware of Social
             Security Disability Insurance.
    10.16   Congress should consider eliminating    Congress
             the Social Security Disability
             Insurance minimum required quarters
             for severely injured servicemembers.
    10.17   DOD should remove Tricare requirements  DOD
             for copays and deductibles for the
             severely injured servicemembers and
             their families.
    10.18   Maintain the accessibility and          No action required
             stability of quality health care for
             all disabled veterans.
   110.19   VA and DOD should fund research in      VA and DOD
             support of the needs of veterans from
             Operation Iraqi Freedom and Operation
             Enduring Freedom.

                               CHAPTER 11

   *11.1    Congress should establish an executive  Congress
             oversight group to ensure timely and
             effective implementation of the
             Commission recommendations. This
             group should be cochaired by VA and
             DOD and should consist of senior
             representatives from appropriate
             departments and agencies. It is
             further recommended that the
             Veterans' Affairs Committees hold
             hearings and require annual reports
             to measure and assess progress.
------------------------------------------------------------------------

                                 ______
                                 
Responses to Questions Submitted by Hon. Daniel K. Akaka, Chairman, to 
  James Terry Scott, LTG, USA (Ret.), Chairman, Veterans' Disability 
                          Benefits Commission
    First, let me say that the answers I am providing to your questions 
reflect my views and not necessarily those of all the members of the 
Veterans' Disability Benefits Commission since the Commission completed 
its work in October 2007 and submitted the report at that time.

    Question 1. The Commission offered an estimate that only 1.1 
million new veterans will enter the veterans' population between 2006 
and 2030. How did the Commission arrive at that estimate?
    Response. This question apparently refers to the information 
contained in Table 6.3, Average Monthly Number of Veterans Receiving VA 
Disability Compensation and Annual Cost, 2000-2018, on page 229 of our 
Commission's report. This data was provided to the Commission by the 
Veterans Benefits Administration and I refer you to VBA for a detailed 
explanation of the model used to project the number of veterans 
receiving disability compensation and the estimated annual amount of 
the benefit. My understanding is that the number of veterans considers 
both the number of discharges anticipated by the Department of Defense 
and VA's actuarial projection of mortality of service disabled 
veterans. The number of discharges would be much greater than 1.1 
million but offset by the expected number of veteran deaths.

    Question 2. What was the Commission's conclusion as to whether 
medical expertise should be available to claims adjudicators when they 
are reviewing applications for compensation?
    Response. Our Commission asked the Institute of Medicine (IOM) to 
provide advice on the role of clinicians in the claims/appeal process. 
We were aware that medical staff are no longer members of VA rating 
boards yet physicians are members of the Department of Defense 
disability evaluation process at all decision and appeal stages. IOM 
concluded that VA raters should have ready access to qualified health 
care experts who can provide advice on medical and psychological issues 
that arise during the rating process (IOM Recommendation 5-5 \1\). The 
Commission agreed with that recommendation. We believe that Congress 
will need to act to guide the Court of Appeals for Veterans Claims in 
what medical consultants may do (weigh the medical evidence) and may 
not do (substitute their opinion for the treating physician's.) This 
subject is addressed more fully in pages 116-119 in the Commission's 
report and pages 193-195 in the IOM report: A 21st Century System for 
Evaluating Veterans for Disability Benefits.
---------------------------------------------------------------------------
    \1\ IOM, A 21st Century System for Evaluating Veterans for 
Disability Benefits, The National Academies, 2007, 193-195.

    Question 3. The Commission found that not only is VA's current 
Rating Schedule out of date but that VA does not have an adequate 
system for updating the Rating Schedule nor the resources to create 
such a system. According to the Institute of Medicine report, which the 
Commission relied on, VA currently has only one physician and a support 
staff responsible for all updates pertaining to the Rating Schedule. 
Did the Commission have a view on what level of resources are needed in 
order to keep the Rating Schedule current? Did the Commission have a 
view on whether VA should have a specific unit and staff assigned to 
update and maintain the Rating Schedule?
    Response. Our Commission did not estimate the staffing requirements 
needed to complete the revision of the Rating Schedule nor the staffing 
needed to keep the schedule up to date. Neither did IOM, although IOM 
noted that the Social Security Administration has six doctors and 
several times that number of analysts for its revision process. It is 
clear that VA has not made sufficient progress since its ``major 
revision effort'' was begun in 1990. Therefore, VA must devote much 
greater management attention and resources if it is to complete the 
revision of the schedule in a timely manner. A separate organizational 
element internal to VA and devoted to this effort might well a useful 
approach.

    Question 4. One very significant change recommended by the 
Commission is expanding the concept of disability to include functional 
limitations in daily living and loss of quality of life. Please 
describe the Commission's process in arriving at this recommendation.
    Response. Our Commission concluded that there has been an implied 
but unstated Congressional intent to compensate disabled veterans for 
impairment in quality of life due to their service-connected 
disabilities. Our conclusion was reflected in Research Question 2 of 
our 31 research questions. The Commission addressed this research 
question in two ways. We asked the IOM to suggest specific measures for 
assessing the impact of disability on quality of life. In addition, we 
requested that CNA Corporation (CNAC) conduct an extensive survey of a 
representative sample of disabled veterans to ascertain the extent of 
the impact. IOM's analysis is reflected in Chapter 3 of its report: A 
21st Century System for Evaluating Veterans for Disability Benefits, 
and its recommendation 3-1 (pg. 89) concluded that limiting 
compensation to work disability or earnings loss would be too 
restrictive and inconsistent with current models of disability. IOM 
recommended also compensating veterans for loss of ability to engage in 
usual life activities other than work and loss in quality of life. The 
results of the CNAC survey demonstrated that disabilities diminish 
quality of life at all levels of ratings and further, that the impact 
is greater for those with mental rather than physical disabilities. 
Together, the IOM and CNAC findings provide a sound philosophical and 
research-based justification for compensating veterans for the impact 
of their service-connected disabilities on quality of life. That is 
what the Commission recommended.

    Question 5. C.N.A.'s analysis of the impact of disabilities on 
veterans' earning capacities found that veterans who enter the 
compensation system at a younger age earn significantly less over the 
course of their lifetime than do veterans who enter the system later in 
life. The Commission's report recommends revising the payment scale to 
increase payments to younger veterans, especially the severely 
disabled. Did the Commission discuss how this might be done without 
leaving older veterans with the impression that they are being 
shortchanged?
    Response. The CNAC analysis clearly demonstrates that a disparity 
exists for the younger veteran and that it is because veterans entering 
the system at older ages have much of their working life behind them. 
This would need to be explained to the older veterans. Our Commission 
did not discuss specific approaches that could be used to explain these 
findings to older veterans.

    Question 6. Based on an analysis by CNA, the Commission's report 
concludes that the dramatic increase in the number of I.U. recipients 
in recent years is not due to manipulation of the system, as some have 
suggested. Instead, the report suggests that a proper revision of the 
Rating Schedule would remove the need to deem many veterans as 
individually unemployable. Please expand on the Commission's views on 
the current deficiencies in the Rating Schedule and on what measures 
might correct the over-reliance on I.U.
    Response. The over-reliance on IU is based on the limitations of 
the current schedule which requires a finding of IU in order to address 
demonstrated unemployability. The single biggest deficiency in the 
Rating Schedule regarding IU is found in the criteria for mental 
disorders, especially PTSD. A single set of criteria is used for rating 
all mental disorders. These criteria require the disorder to cause the 
veteran to be unable to work in order to be rated at the 100 percent 
level. Of the 223,000 veterans assigned IU status as of December 2005, 
31 percent had PTSD and 16 percent had other mental disorders. Thus, 
almost half had mental disorders. It is not clear why these veterans 
were not rated 100 percent without the need to assign IU status if they 
are truly unable to work due to their mental disorders. Our Commission 
recommended revision of the criteria and a separate set of criteria for 
PTSD. Many of these veterans can be rated 100 percent instead of IU if 
their disabilities truly make them unable to work.

    Question 7. The Commission's report recommends that VA launch a 
research effort to determine the extent to which the current Rating 
Schedule fails to compensate veterans for loss of quality of life for a 
particular disability. The report does not come to any conclusions 
about how the current Rating Schedule falls short in compensating for 
quality of life, but nonetheless recommends that Congress increase 
compensation rates up to 25 percent as ``an interim and baseline future 
benefit for loss of quality of life.'' Please explain how the 
Commission arrived at this recommendation. Did the Commission have a 
view on how long this increase should remain in place?
    Response. Our Commission had CNAC conduct an analysis of earnings 
that concluded that overall disability compensation payments overcome 
average loss of earnings capacity except for veterans with PTSD or 
other mental disorders and those severely disabled at a younger age. 
However, the analysis also found that disability compensation does not 
provide any compensation for the impact of disability on quality of 
life. IOM recommended that compensation be paid for impact on quality 
of life as well as lost earnings while acknowledging that the 
measurement tools or scales currently available are still in the 
formative stages. Therefore, IOM recommended, and our Commission 
agreed, that VA should launch a research and development effort and 
study ways of determining loss of quality of life. In light of VA's 
lack of progress in revising the Rating Schedule and in anticipation of 
a fairly lengthy process to develop and validate the tools to measure 
loss of quality of life, our Commission felt that immediate action 
should be taken to begin to compensate veterans in the meantime. Thus, 
we recommended that current compensation rates be increased by up to 25 
percent (and I stress ``up to''), with first consideration for the 
severely disabled. Congress and VA must determine exactly how the 
increase would be implemented. This temporary increase should remain in 
effect until the more structured process could be developed, authorized 
(if needed), and implemented.

    Question 8. The Commission recommended that VA explore compensating 
veterans for the non-work aspects of disability as well as for losses 
in quality of life, independent of one another. These two concepts 
appear to be closely related. How can a new Rating Schedule and payment 
scale avoid an overlap in the adverse effects of disability that the 
two elements each account for?
    Response. Our Commission recognized that some of the criteria 
contained in the Rating Schedule, particularly for mental disorders, 
could be viewed as addressing quality of life and the non-work aspects 
of disability. To some extent, the Special Monthly Compensation (SMC) 
payments for such things as loss of or loss of use of limbs or organs 
also address quality of life and non-work aspects of disability rather 
than loss of earnings. Loss of quality of life and the other non-work 
aspects of disability could be integrated into the revised Rating 
Schedule. An alternative is to consider the approach of some foreign 
countries that have completely separate scales to address quality of 
life and loss of earnings. Some offer a lump sum payment. The 
mechanisms for establishing a payment scale must be developed by 
Congress and VA.

    Question 9. The Commission's report discusses at some length VA's 
vocational rehabilitation and employment program and summarizes a 
number of reports and evaluations that have been completed since 1999. 
However, the report does not appear to state an independent view on the 
role of vocational rehabilitation within the context of the 
rehabilitation of an individual with a severe disability. Please 
describe what you believe to be the Commission's view on VA's current 
vocational rehabilitation program and what role it is playing in 
rehabilitating veterans with serious disabilities.
    Response. Our Commission developed a series of eight principles 
intended to underpin the policies and practices of veterans' disability 
benefits now and in the future. Principle 2 states: ``The goal of 
disability benefits should be rehabilitation and reintegration into 
civilian life to the maximum extent possible while preserving the 
veteran's dignity.'' We recognized that numerous efforts have been 
undertaken over the past several years to restructure and refocus the 
vocational rehabilitation program and its organizational structure, 
largely to place greater emphasis on employment rather than on 
education and training. We also noted that the three largest groups of 
participants were rated 30 percent, 40 percent, and 20 percent, 
indicating that perhaps sufficient emphasis may not be given to the 
more seriously disabled. We did not devote sufficient attention and 
analysis to vocational rehabilitation to offer detailed recommendations 
beyond those in the report.

    Question 10. To the extent that some component of payment of 
disability benefits is based on a ``loss of earnings,'' does that 
suggest that the successful completion of a program of vocational 
rehabilitation and placement in a job should result in a reevaluation 
of the extent to which earnings are adversely impacted by a disability?
    Response. I do not believe that any individual veteran who 
completes vocational rehabilitation should automatically be re-
evaluated. Nor do I think that disability compensation should in any 
way become a means tested program. Veterans should be encouraged to 
overcome their disabilities to the maximum extent possible without fear 
of losing benefits. However, disability benefits for earnings loss is 
based on the average loss for all similarly situated veterans and our 
Commission recommended periodic analysis of earnings (recommendations 
7.2 and 7.3). To the extent that successful vocational rehabilitation 
of disabled veterans results in increased earnings, the average loss of 
earnings will be impacted and the analysis would identify the impact. 
Consideration can then be given to adjustment of future payment rates 
if warranted.

    Question 11. Under VA's VR&E program of Independent Living Services 
there is an annual cap on participation of 2,500. Did the Commission 
look at the impact this cap may have on the provision of services to 
severely disabled individuals and their rehabilitation and 
reintegration?
    Response. The Commission was not aware of the existence of a cap on 
independent living and did not address this issue. I believe that VA 
should be prepared to assist all severely disabled service-connected 
veterans who need assistance with independent living. I do not know the 
purpose of an arbitrary cap that could result in denying help to any 
qualified veteran who needs it.

    Question 12. The Commission made several recommendations concerning 
compensating disabled veterans for loss of quality of life. I know that 
the military considers quality of life an important part of the 
equation for taking care of servicemembers and that quality of life can 
contribute significantly to the morale of military units. As one who 
served over thirty years in uniform, please give us your thoughts on 
how it should be defined and measured in the context of a disability 
compensation system.
    Response. I agree that quality of life is an extremely important 
aspect of military life and is reflected in morale, retention and 
reenlistment rates, recruitment, and especially mission success. I 
think there is ample evidence and the Department of Defense devotes 
considerable efforts to assessing the impact housing, recreation, and 
benefits such as commissary privileges and significant funding on 
improving those aspects found to be of greatest importance to 
servicemembers and their families. In the context of a disability 
compensation system, I believe that IOM accurately described the many 
dimensions of quality of life as cultural, psychological, physical, 
interpersonal, spiritual, financial, political, temporal, and 
philosophical. All of these dimensions are important aspects to be 
considered when assessing the impact of disability. IOM also identified 
and described many of the various approaches used to measure and 
compensate for impact on quality of life. The range of approaches 
include programs in Canada and Australia for disabled veterans. I 
believe that a more thorough and detailed analysis of both measures and 
compensation schemes should be completed in an expedited manner so that 
options can be considered and policy decisions made as soon as 
possible.

    Question 13. The Commission noted that it found incidences of non-
compliance with veterans' preference enforcement in hiring and 
contracting and with civilian requirements for certification and 
licensure. However, there do not appear to be any recommendations in 
this area. Please discuss how the Commission dealt with this issue and 
why no recommendations were made.
    Response. The Commission became aware of allegations of non-
compliance through testimony at public meetings and correspondence from 
veterans. This topic was outside the Commission's charter, and we did 
no analysis to determine the scope of the problem. Therefore, we did 
not include recommendations on this issue in our final report as a 
result.

    Question 14. The Commission recommended that VA and DOD jointly 
create an intensive case management program for severely disabled 
veterans. In response to a recommendation of the Dole-Shalala 
Commission, VA is hiring ten Recovery Care Coordinators as part of a 
pilot program to improve case management. Do you believe that this 
current effort responds to the Commission's recommendation or did the 
Commission envision a larger program?
    Response. The Commission did not attempt to estimate the 
appropriate number of case managers. I would defer to the best judgment 
of VA and DOD.

    Question 15. Did the Commission view the term ``severely injured,'' 
for which the Commission recommended DOD adopt a standardized 
definition, as the same as the term ``severely disabled?'' If not, what 
are the differences between the two terms?
    Response. The term severely injured has been generally used by the 
services and therefore that is the term that the Commission used. In 
hindsight, perhaps we should have used the term ``severely disabled'' 
since there are many instances in which a servicemember becomes 
severely disabled as a result of a disease or an event such as a 
stroke, not as a result of an injury. The severity of the disability 
seems to be what is of greatest importance. The point we tried to make 
is that a commonly accepted definition is not in use.

    Question 16. Please discuss the disparities that the Commission 
found between the transition benefits and services available to members 
of the Guard and Reserve as opposed to those available to active duty 
servicemembers.
    Response. Our Commission was aware of the efforts of the Commission 
on the National Guard and Reserves and tried to be cognizant of the 
special challenges faced by the Guard and Reserves. However, we were 
not able to devote a great deal of effort researching this area. We 
specifically addressed the Guard and Reserves in Recommendation 5.7 
which would require a mandatory benefits briefing for all separating 
servicemembers, including National Guard and Reserves. Also, 
Recommendation 10.5 pertaining to Benefits Delivery at Discharge would 
make BDD services available to all separating servicemembers (to 
include National Guard, Reserve, and medical hold patients) who may not 
currently participate because they often do not have an established 
separation date or one that falls within 180 days of separation.

    Question 17. Was it the Commission's intention that service-
connected compensation would be withheld in whole or in part if a 
veteran with a psychiatric disability was not participating in a 
recommended treatment program?
    Response. The Commission did not specifically discuss withholding 
compensation in whole or in part but some level of penalty for non-
compliance may be implied if treatment, compensation, and vocational 
assessment are coupled and a reevaluation is completed every 2-3 years 
as recommended. The Commission understood the difficulty associated 
with implementing this recommendation and did not want to be too 
prescriptive, allowing VA and the Congress to decide the best way to 
implement the intent of this recommendation. We did not feel that 
veterans with PTSD are well served if only compensation is provided 
without providing for treatment, vocational rehabilitation, and follow 
up to determine efficacy of treatment.

    Question 18. Was it the Commission's expectation that an additional 
service-connected compensation benefit would be paid only if a veteran 
with a psychiatric disability was participating in a recommended 
treatment program?
    Response. The holistic approach we recommended might include an 
additional benefit for treatment, but compliance with treatment should 
be a requirement.

    Question 19. How did the Commission envision the relationship 
between reevaluation for PTSD and payment of compensation?
    Response. Again, the Commission did not want to be too prescriptive 
and allowed sufficient latitude for the mental health and benefits 
professionals to develop a reasonable program design.

    Question 20. According to the Institute of Medicine, the only 
treatment for PTSD that has been concluded to be effective is exposure 
therapy. This therapy may not be available in all geographic areas. 
Under what circumstances, if any, should veterans be permitted to 
receive service-connected compensation or additional compensation if 
effective therapy is not reasonably available in the geographic area 
where they reside?
    Response. The IOM report: Treatment of Post Traumatic Stress 
Disorder, was published after the completion of the Commission's report 
and could not, therefore be reflected in our report. From a very brief 
review of this report, I noted that IOM specifically said that ``. . . 
concluding that the evidence is inadequate to determine efficacy is not 
the same as concluding that a treatment modality is inefficacious.'' 
\2\ IOM further stated that they did ``. . . not intend to imply that, 
for example, exposure therapy is the only treatment that should be used 
in treating individuals with PTSD.'' \3\ I think it is the 
responsibility of VA to ensure that appropriate treatment for service-
connected disabilities is available, in the private sector if 
necessary. As a person who resides in a rural area of the country, I am 
well aware that there are many areas of the country in which adequate 
health care of all kinds is not readily available. To some extent, it 
is a matter of individual choice as to where a disabled veteran lives. 
The choice is often accompanied by limitations in certain conveniences 
and services, including availability of health care.
---------------------------------------------------------------------------
    \2\ IOM, Treatment of Post Traumatic Stress Disorder, The National 
Academies, 2008, 1.
    \3\ Ibid., 14.

    Question 21. Was it the intention of the Commission that veterans 
would be required to participate in any treatment or only treatment 
which has been proven to be effective in order to receive compensation 
or additional compensation for PTSD or other mental disorders?
    Response. Again, the IOM report on PTSD treatment post dated our 
Commission's report. Our intent was that veterans with PTSD should 
participate in approved treatment. In my judgment, there was inadequate 
research available to specify which treatments are ``proven.''

    Question 22. How should compliance with treatment be evaluated in 
cases where the treatment has significant side effects or is 
contraindicated by reason of other medical conditions, including 
pregnancy?
    Response. Our Commission did not address the issue of treatment or 
pharmacology that is contraindicated or has side effects. VA addresses 
these situations on a daily basis and medical opinion should prevail.

    Question 23. Because veterans with mental disabilities would be 
required to be re-evaluated on a periodic basis, it appears that these 
veterans could never receive a rating of permanent and total 
disability. As a result, their families would be ineligible for CHAMPVA 
health care or dependents' education benefits. Was this the 
Commission's intention?
    Response. The Commission did not assume that reevaluation every two 
to 3 years would have automatic bearing on eligibility for CHAMPVA 
health care for dependents. This situation is resolvable by Congress 
and VA.

    Question 24. The Commission believes that veterans who completed at 
least one period of honorable service should be barred from VA benefits 
if a later period of service terminates under conditions other than 
honorable. In a number of cases, subsequent evaluation of veterans, 
especially combat veterans, has indicated that the bad behavior 
(including AWOL status) for which they received a less than honorable 
discharge was related to psychiatric impairments, including substance 
abuse from attempts to self-medicate. What consideration did the 
Commission give to the effect of psychiatric disabilities, sometimes 
mischaracterized as personality disorders, on the character of 
discharge?
    Response. The Commission's recommendation is to bar all benefits 
for those discharged with a bad conduct or dishonorable discharge. It 
did not recommend barring those with discharges in the category of 
other than honorable. There are existing VA and DOD processes under 
which individuals with uncharacterized discharges or discharges under 
other than honorable conditions can apply for reconsideration.

    Question 25. Should VA benefits be provided to veterans who have 
had their discharges upgraded by a military review board authorized to 
correct the character of discharge?
    Response. Discharges upgraded by a military review board would be 
accepted as upgraded.

    Question 26. As proposed in the draft America's Wounded Warriors 
Act, should a portion of a veteran's compensation ever be automatically 
utilized as a premium for survivor benefits if that benefit is then 
offset against dependency and indemnity compensation for which the 
surviving spouse would otherwise be entitled? Is this a program that 
the Commission considered?
    Response. The Commission did not consider an approach in which 
survivor benefits could be ensured by a voluntary (or involuntary) 
contribution from disability compensation similar to the DOD Survivor 
Benefit Program (SBP).

    Question 27. Given the Commission's experience with relying on 
reports from outside groups, is 7 months adequate time for VA to 
contract for a report and then present that completed report to 
Congress on such a complicated and important issue as appropriate 
compensation amounts under a new disability system that reflects 
average loss of earning capacity and loss of quality of life?
    Response. I have not had an opportunity to review the scope and 
requirements of the new VA contracted study so I am not in a position 
to comment on the adequacy of the time allowed. Certainly, completing 
any kind of detailed study within 7 months will be a challenge.
                                 ______
                                 
Responses to Questions Submitted by Hon. Richard Burr, Ranking Member, 
 to James Terry Scott, LTG, USA (Ret.), Chairman, Veterans' Disability 
                          Benefits Commission
    Question 1. I understand that you have had an opportunity to review 
a summary of the bill I have been working on, which would get the 
Department of Defense out of the business of rating disabilities, 
create transition payments for those found unfit for duty, require a 
complete update of the Rating Schedule, and compensate for loss of 
quality of life. Given that the work of your commission heavily 
influenced that draft bill, I would be interested in your preliminary 
thoughts about it and any suggestions you may have for how it could be 
improved.
    Response. I have reviewed the summary of your draft bill and 
generally agree with its major provisions. Understanding that one bill 
cannot address all of the Commission's recommendations, I would like to 
see some future action on the key recommendations we offered.

    Question 2. You mentioned in your testimony that all veterans 
should be evaluated and compensated under the same criteria and that we 
should not set up different systems for different generations of 
veterans.
    A. If the Department of Veterans Affairs (VA) updates the Rating 
Schedule to incorporate a quality of life component, would you suggest 
that we allow all veterans to be re-rated under that updated schedule?
    Response. That would be one approach. Another is to base the 
quality of life component on the existing level of disability, which 
may make re-rating unnecessary.

    B. If so, do you have any suggestions for how we could help VA deal 
with a potentially large influx of claims from veterans seeking to be 
re-rated?
    Response. Whatever approaches are approved by VA and the Congress, 
any requirement to re-rate large numbers of veterans should be avoided.

    Question 3. You noted in your testimony that you are in general 
agreement with recommendations made by the Dole-Shalala commission last 
year, but you did not support the distinction between combat and non-
combat veterans and ending compensation at retirement age. If those 
aspects were removed, would you support their recommendations in total?
    Response. The Dole-Shalala report and recommendations were somewhat 
vague in a number of areas. The body of the report contained a number 
of recommendations that were not included in the major recommendations 
offered. For those reasons I cannot say that I support their 
recommendations ``in total.''

    Question 4. As the Institute of Medicine found, updating the Rating 
Schedule to compensate for loss of quality of life ``would be difficult 
and costly.'' Do you agree with that assessment? If so, do you believe 
it is still worth pursuing?
    Response. Apparently updating the Rating Schedule is difficult and 
costly as VA has failed to do so in a comprehensive manner up to now. I 
believe that compensation for loss of quality of life is an important 
factor in revising the schedule and do not think that developing a 
quality of life component is an unreasonable burden.
                                 ______
                                 
 Response to Questions Submitted by Hon. Kay Bailey Hutchison, Senator 
from Texas, to James Terry Scott, LTG, USA (Ret.), Chairman, Veterans' 
                     Disability Benefits Commission
    Question 1. How many positions within the VA are tailored to 
coordinate health care services for wounded servicemembers? What are 
the titles and responsibilities for the persons that are responsible 
for coordinating a wounded servicemember's health care? Please 
highlight any distinctions that exist between those serving in each of 
the different armed services, the National Guard, and the Reserves.

    Question 2. How many positions within the VA are tailored to 
coordinate disability benefits for wounded servicemembers? What are the 
titles and responsibilities for the persons that are responsible for 
coordinating a wounded servicemember's disability benefits? Please 
highlight any distinctions that exist between those serving in each of 
the different armed services, the National Guard, and the Reserves.

    Question 3. What is the VA doing to improve the transition 
experienced by wounded servicemembers from the Department of Defense to 
the VA?

    Question 4. What is the VA doing to reduce the redundancy that 
exists between personnel that coordinate health care and disability 
benefits of a wounded servicemember's care?

    Question 5. What is the VA doing to improve communication between 
the Veterans Health Administration (VHA) and the Veterans Benefits 
Administration (VBA) to ensure the coordination of health care and 
disability benefits for wounded servicemember?

    Question 6. What is the VA doing to improve communication with the 
Department of Defense to ensure a seamless transition between the two 
systems for wounded servicemembers?
    Response. Senator Hutchison, I am not in a position to answer these 
questions since I do not possess the necessary current knowledge of VA 
operations. Many of the important issues you ask about are currently 
being addressed by VA, and I do not know their status. As you know, the 
Commission reported out in early October and I am not privy to the 
current status of these issues. I respectfully defer to the Department 
of Veterans Affairs.

    Chairman Akaka. Thank you very much, General. We will have 
two rounds of questions this morning for you.
    General, I know you dealt with and also met with other 
organizations before your recommendations were made. Can you 
please describe in some detail the process that the Commission 
followed to examine the findings and recommendations made by 
the Institute of Medicine and CNA Corporation to decide whether 
to adopt the findings and recommendations of those 
organizations?
    General Scott. Well, we begin, sir, by identifying 31 
issues that we thought were worthy of study. Some of them 
required medical expertise and were assigned to the IOM for 
analysis. Some of them required a significant amount of data 
gathering and analysis and those were forwarded to the CNA 
Corporation. Some of them we were able to deal with through our 
staff. So we divided these 31 problem areas or issues between 
the three entities and went to work on them.
    Now, the IOM, of course, as you well know, is a very 
independent organization and they provided the results of their 
studies, which are available as part of our report, and we 
carefully reviewed each recommendation that the IOM made. And 
we accepted virtually all of them--a couple with comment--and I 
believe there was one or two that we did not agree with. But, 
we discussed each recommendation they made in the light of how 
the Commissioners felt it fit into the program.
    The same thing with the CNA--they provided us with a lot of 
data, some of which we provided you at the April hearing and 
the rest of which we provided your staff, and is included in 
the book. We asked at each juncture, well, what does this mean? 
You know, is this a gee-whiz figure and is that where it ends? 
Or is it something we need to deal with? And I go back to the 
analysis that said that, essentially, the compensation for loss 
of average earnings was adequate to cover the veterans that had 
it, except for three instances, and I believe those were: those 
with mental ailments or PTSD; those who entered the system at a 
very young age; and those who are granted maximum benefits 
because their disabilities make them unemployable.
    Anyway, we took the information they provided and the 
analysis, and applied it to our own judgment and our own 
review, and we accepted, again, a great amount of their 
recommendations. We didn't accept them as, well, here they are, 
so we'll accept them all. Each one was discussed at length; and 
if it became a part of one of the Commission recommendations, 
then it appears in the 112-113 that we made. If it was one of 
those that we agreed with but did not incorporate into our 
results, well, it's in their reports.
    So, it was done very carefully, very methodically over a 
long period of time, as many of the people sat through our 
endless sessions as we discussed these recommendations from the 
IOM and the CNA.
    Does this get at your question, sir?
    Chairman Akaka. Yes, sir.
    General, we understand also that there have been some 
assertions without recommendations. My question to you on that 
is, what weight was the Commission intending that Congress give 
to assertions where the Commission makes no recommendations, 
but cites, sometimes strongly, another group's recommendation? 
Let me give you an example.
    In the beneficiary travel section, the Commission cites a 
Disabled American Veterans' resolution that recommends a line 
item in the VA budget specifically for beneficiary travel. 
There was an assertion made there, and so, I'm asking you about 
these other groups' recommendations.
    General Scott. Well, if it was in one of our 
recommendations, we felt strongly about it. If it was an 
assertion, it was something that we discovered that we thought 
was worthy of comment. I believe the way we addressed that 
particular issue is, we said that the VA should have the same 
authority as the DOD to provide travel, food and lodging and 
all of that for the injured servicemember's family. I believe 
we covered that particular assertion in that recommendation.
    So, if we felt strongly about it, it made it into the 
recommendation, sir.
    Chairman Akaka. General, the Commission recommended that 
reevaluations of veterans receiving benefits for PTSD should 
occur every two to three years to gauge treatment effectiveness 
and encourage wellness.
    I note that IOM, in their report reviewed by the 
Commission, recommended that, and I quote, ``the determination 
of whether and when reevaluations of PTSD beneficiaries are 
carried out should be made on a case-by-case basis using 
information developed in a clinical setting,'' unquote.
    IOM also noted that the stressors associated with an 
evaluation for PTSD may increase symptoms.
    My question to you is, why did the Commission reject the 
IOM recommendation on this issue?
    General Scott. I would not characterize it as a rejection. 
I would characterize it as a difference between how the medical 
people look at reevaluation and how a group of, basically, 
veterans looked at it.
    The IOM believes, and it is pretty much throughout their 
study, that the diagnosing physician or the clinician should 
make the recommendations for follow-on treatment for 
reevaluation and all of that; and I think that's probably the 
way that most medical people look at things. In other words, 
the IOM didn't think there should be a template that said, 
every two to three years everybody gets looked at.
    Our view was, basically, that reevaluation was an integral 
part of a holistic approach, which included compensation, 
treatment, and vocational rehabilitation. I believe if the 
Commissioners were all here, they would say that two to three 
years would be a guide and not a hard requirement. I think its 
just the way--the difference in the approach--that medical 
people have to these things and they leave it to the head 
clinician, versus the approach that we had which was, well, if 
we don't tell them to do it on a certain interval, they might 
not do it at all. So, I think it was a difference in approach.
    Personally, I would never want to get into an argument with 
the IOM regarding the frequency of reevaluation. I might want 
to get into an argument with somebody about how good the 
initial evaluation was and how thorough the reevaluations were. 
But the timing issue--I do not think that's a critical issue 
for me.
    Chairman Akaka. Thank you very much, General.
    Senator Burr.
    Senator Burr. General, let me stay in the same area for 
just a second.
    The Commission suggested linking Post Traumatic Stress 
Disorder treatment and rehabilitation with receipt of 
compensation.
    General Scott. Right.
    Senator Burr. Walk us through how the Commission envisions 
that being implemented?
    General Scott. Well, sir, let me start with the 
Commission's conclusion and discussion--that the body of 
research on PTSD was limited to the point that it was very 
difficult for the IOM or anybody else to get their arms around. 
In other words--and I hope this is not offensive--but, we have 
just been paying people to go away with PTSD.
    It has been a way of compensating veterans who are 
diagnosed with PTSD, but it has precluded, in the judgment of 
the Commission, any effort to make these people better. And, it 
is our judgment that one of the principle goals of the VA, and 
of us, was that we want to make people better, so that they can 
be returned to the fullest extent possible to ordinary life. 
Without treatment, I do not see how we were fulfilling that 
obligation. So, that is where treatment came from.
    The approach of linking treatment, compensation, vocational 
rehabilitation and reevaluation was so that we could get a 
system where you could follow how people were doing.
    Again, I am not necessarily hung up on the frequency of 
reevaluation, but it seems to me that if you do not reevaluate 
you do not know whether the treatment is doing any good or not. 
And many of the medical professionals believe that, while PTSD 
is not perhaps curable, it is treatable. And my judgment would 
be that we have not, as a Nation, in the past, made adequate 
effort to treat it.
    And so, by linking these together in a non-adversarial 
way--to address Senator Tester's comments earlier--the 
Commission believed that that is a way we can get our arms 
around this PTSD issue. And, we can also gather the data that 
we need in order to do a better job in the future, perhaps 
prevention or early treatment and all of that. So, that is 
where it kind of came from, sir.
    Senator Burr. Do you or the Commission believe that there 
are other disabilities that would be appropriate to tie 
compensation to treatment? In other words, are there areas--not 
just limited to PTSD--where this would be appropriate and 
effective?
    General Scott. Well, I think that anything that dealt with 
mental problems or issues could fall into that. In other words, 
you could ask the question, if a servicemember has lost a limb, 
once the stabilization has occurred and all of that, how much 
added benefit would there be to trying to tie compensation and 
treatment and all of those things together? It is minimal. I 
guess what I would say is that we Commissioners saw a 
difference between the mental side--which is much harder to get 
your arms around--and the physical side; which, in our 
judgment, the VA does a good job in the treatment and 
vocational rehabilitation of those physically injured.
    Maybe not everybody agrees, but at least the VA has a 
program and an approach to dealing with physical injuries that 
occur. But when things are of a mental nature, including TBI, 
we believe that requires a lot more careful monitoring, a lot 
more of a treatment regimen and the like.
    Senator Burr. General, I would like you to clarify and 
clear up something. The Commission recommended that some 
disability payments should be increased up to 25 percent. Many 
have interpreted the recommendations of the Commission to be 
that the entire Rating Schedule should increase 25 percent. 
That is not how I understood the recommendations of the 
Commission.
    Would you try to clarify exactly what the Commission meant 
in that statement?
    General Scott. Right. Well, I found myself misquoted on 
that on more than one occasion. I decided, well, it was 
probably due to lack of clarity on my part from trying to 
explain it. What we determined as a Commission was that, and 
you pointed this out, there is currently no payment nor 
compensation for loss of quality of life.
    We believe that, based on the severity of the disability, 
there probably ought to be some sort of a sliding scale for 
compensation for loss of quality of life. The example would be, 
if you have someone with a 10 percent disability, one could 
made an argument that the effect on the quality of life would 
be, if not minimal, then certainly not great, but someone with 
100 percent disability you would anticipate that the impact on 
quality of life would be significant.
    So, the way we discussed it was that, well, for the 100 
percent disabled up to 25 percent--something like around 25 
percent additive--might cover the quality of life issues. But 
for the 10 percent certainly we would not recommend that they 
get full 25 percent quality of life addition because it 
probably has not affected their quality of life as much. So, we 
looked at it as a sliding scale based on disability with a 
maximum being about 25 percent. We also said that needed 
further study.
    We felt obliged--if we were going to say, well, something 
has got to be done about quality of life--that we had to offer 
some sort of a model as to how that could be approached. It may 
not be the very best model, but we felt like we have got to do 
something about quality of life. So, rather than ask Congress 
or VA to figure it out, we felt obliged to put some sort of a 
model in there that at least could be considered. And it was on 
a sliding-scale basis, based on degree of severity of the 
disability with the maximum being about 25 percent.
    Senator Burr. Let me make sure I've also got my facts 
right. The Commission noted that there are some disabilities 
that have no impact on the ability to work and recommended that 
the VA conduct research on the extent to which the Rating 
Schedule already accounts for the loss of quality of life. 
Correct?
    General Scott. Right.
    Senator Burr. What is the Commission's recommendation 
relative to that point?
    General Scott. Well, it goes back to the need to revise the 
Rating Schedule to address the problems of levels of disability 
in the context of today's society and today's medicine, and all 
of that. And, one of the things we were talking about there was 
that we weren't sure that all of the disabilities that were 
listed in the current Rating Schedule ought to be there, or 
ought to be there in the format they were. So, I think that is 
where that one came from.
    Senator Burr. I appreciate the Chairman's indulgence. If I 
understand you correctly, the Commission looked and said there 
has to be a new Rating Schedule.
    General Scott. Right.
    Senator Burr. And, in that new Rating Schedule there are 
things that we have identified--PTSD and mental health issues--
that we believe are woefully under-represented in payments in 
the current system.
    There are things in the current system that the only way we 
could justify the payment is to say, quality of life played a 
part in the decision of, one, it being there or, two, the size 
of the payment. But, in the future there are some things that 
are going to be enhanced, there are some things that may go 
down, there are some things that may be eliminated, there are 
some things that may be added.
    General Scott. Well, that is right, and that is why this 
revision of the Rating Schedule is so critical.
    The concern that we had was that no where in the existing 
system is quality of life compensation quantified. Now, there 
is a body of thought in the organization that, well, the 
compensation, such as it is--let's say, I think it is $900 for 
60 percent disability, something like that--that built into it 
is something that deals with quality of life. But, we found 
that, actually, the compensation is adequate to cover loss of 
average earnings but not of anything to do with quality of 
life.
    So, what we were attempting to do was to separate out 
quality of life from average loss of earnings and, as you say, 
a new Rating Schedule may have some different approaches to 
ailments. There may be some new ones--and I am thinking now of 
TBI which we have never talked about before in great detail--
and there may be some others that are combined or, arguably, 
might be dropped.
    Senator Burr. Thank you.
    I thank the chair.
    Chairman Akaka. Thank you very much, Senator Burr.
    On the second round here, General, I just want to go back 
to the last question that I asked you about process for 
examination.
    In the IOM report I discussed earlier, IOM also found that 
there is evidence that disability payments may actually 
contribute to better treatment outcomes.
    My question to you is, on what basis did the Commission 
determine that reevaluations every two to three years would 
encourage wellness? Are there other medical or mental health 
conditions, which the Commission found that reevaluation would 
encourage wellness?
    General Scott. Well, the data from the Center for Naval 
Analysis that analyzed the relationship between physical 
disability and overall mental health, and mental disability and 
overall physical health, led us to conclude that some kind of 
evaluation or treatment or both might improve the overall 
mental health or the overall physical health of the veteran who 
is disabled in some way. And, again, we were coming at it from 
the standpoint of, what we want to do is try to make them all 
better.
    Now, we understand that that is resource-intensive and we 
understand that the VA has to set some priorities of how their 
medical professionals' time should be used. But if you look at 
the CNA reports in conjunction with the IOM, you kind of 
conclude that, well, there are a lot of these people whose 
general overall health, mental or physical or both, could be 
improved if they were receiving reevaluations or treatment.
    The fear that some of the organizations have about 
reevaluations is that, if you're called in for reevaluation, 
they say they want to take money away from you. And we do not 
see it as that. We did not see it that way. We saw it as a way 
of determining--as having benchmarks for the physical and 
mental health situation of the veteran, benchmarks from either 
a treatment regimen or a reevaluation regimen or both, so that 
you could maybe improve their health. So, that was the basis 
that the Commission used for recommending that.
    Chairman Akaka. General, at our hearing last October, you 
testified that it was the Commission's guess that it would take 
five years to update the entire schedule of disabilities. 
However, the Commission offered that some priorities, such as 
TBI and PTSD, would be a good starting point and that the 
Commission hoped these would be done in a more expeditious 
fashion.
    Please explain the timeline the Commission envisioned for 
how rapidly the TBI and PTSD revisions of the disability 
schedule could be done.
    General Scott. Well, again, the comment about five years 
was, of course, pulled out of the report and it is another one 
that I probably did a poor job of explaining, where the five 
years came from. Because what we said was, we were trying to 
set an outside boundary which would force the revision to fall 
inside.
    What we probably should have said in the report, and what I 
probably should have said in October is, that this can be done 
more quickly than that.
    Basically, I do not think the Commissioners felt that they 
were qualified to say well, let's see--it's about a two-year 
deal or its about a two and one-half year deal. We really 
didn't feel qualified to make a precise comment, so, what we 
said was, well, it all needs a look. Somebody should force them 
to do it short of five years--the whole thing.
    Some parts of it need an immediate look, which I am proud 
to say that the TBI and the PTSD are both in the works at VA. 
In fact I think their paper on TBI has been released for 
comment.
    So, these things are picked up on. I kind of go back to 
wishing I had said, that we do not know what the right figure 
would be for how long it would take the VA to do a complete 
revision of the Schedule. And I wish I had said, you know, that 
is something the VA is going to have to come in and justify to 
you--how long it would take, rather than just say, well, we 
ought to force them to do it within five years, which is what 
we said in the report.
    So, it is probably something that if I was rewriting the 
report or revising my comments, I would try to steer away from 
the five years because it has been interpreted to mean, well--
there is no way that the VA can do any of this short of five 
years, unfortunately. And that is not the way it was meant in 
the report, and that is not the way I meant it in the comments.
    Basically, we do not know what the right number is for how 
long it should take the VA to revise the entire Schedule. I 
think the VA probably could give you some figures on that--on 
what their estimate might be.
    Chairman Akaka. Thank you very much.
    Senator Burr.
    Senator Burr. Mr. Chairman, I'll be very brief.
    General Scott, I am going to warn you. I am going to send 
you some questions because I am not going to be able to get 
everything in.
    General Scott. Okay.
    Senator Burr. Two of them, and I won't ask for answers 
right now. Can a third-party group, organization, or company be 
hired or tasked to update the Rating Schedule? If so, how; and 
if not, why?
    And, if all veterans were allowed to be rerated into a new 
system, how would the VA handle the volume of requests? And I 
am very anxious to know your recommendations on that.
    The one question I do want to ask you is this: all three 
Commissions emphasized the need for DOD to get out of the 
disability rating business; to update the Disability Rating 
Schedule; to compensate veterans for loss of quality of life; 
and to place additional emphasis on rehabilitation.
    In your view, since these problems have existed for five 
decades, why hasn't anything been done about it?
    General Scott. Well, my opinion would be that the VA has 
not been resourced at a level that allowed them to adjudicate 
the cases on a more timely basis, and of course, it goes beyond 
just giving them money. You have got to recruit, train, retain 
people. And I think the training and retention of adjudicators 
is probably a reason why that has fallen behind and is still 
behind.
    Beyond the resource issue, I think some of it is, there has 
been a reluctance to adopt such things as the Commission 
recommended: use more technology in the rating system; use more 
automated forms instead of, essentially, just doing it by hand. 
And they are moving in that direction. I think that is part of 
how they have fallen behind--a failure to follow good business 
practices that we see in many organizations. And, some of it is 
for the right reason: because they are worried about the 
individual veteran.
    You do not want to come up with a system where you just 
punch in four numbers and it comes up--here is your rating--
because everybody is different. So, it puts them in a quandary. 
But, I think the failure to adapt modern technologies and 
techniques; and a lack of resources; and maybe some management 
failures in terms of the recruiting, training, and retaining of 
adjudicators is part of it.
    I am not sure I got at your whole question.
    Senator Burr. I think we probably all know the answer to 
it--the political will. I think your Commission found what you 
proposed is extremely tough. It is hard. It affects a lot of 
lives. I think you did and I am going to walk through a door 
you opened.
    General Scott. Okay.
    Senator Burr. I probably would not do it if you had not 
opened it. I think there is a tendency on the part of 
government to find the easy way out, to stay away from the 
tough things, to stay away from the things that make some 
people happy and some people mad. And that has led us to the 
statement you made, ``pay them to go away.''
    Just increasing a disability payment without increasing the 
opportunities to be productive in the future; I perceive we 
fail if that is the route we choose. If, in fact, we 
incorporate what we know and what medicine has taught us works, 
it may mean less money for some; it might mean no money for 
some, because they have overcome their disability. But, at the 
end of the day, if their ability to integrate back into the 
work force, their quality of life is enhanced, their earnings 
capacity has returned, I will feel that we succeeded.
    I think we both know this is a mine field to walk down, and 
few Congresses in the past and few administrations in the past 
and few bureaucrats in the town are willing to do this heavy of 
a lift.
    I hope you have learned from the time you've headed the 
Commission--and I think the Committee understands the 
importance of this--this is something we need to tackle. It is 
not going to be easy; it is going to be hard. We are not going 
to make everybody happy. Some people are going to be mad. But, 
at the end of the day, if our focus is on those men and those 
women who have given so much or the ones that are positively 
affected, then we will have done our job.
    General Scott. Yes, sir. I do think a part of that is that 
we have got to have a Rating Schedule that addresses the 
issues. I do not think you can get to where you are talking 
about going with the current Rating Schedule; and, yes, it is a 
very touchy thing. There is a lot of concern that it will be 
used as a tool to reduce payments across the board, or to make 
it harder for a disabled veteran to get compensation, or all 
that. So, there is a whole lot to it.
    And that kind of gets back to this business of who can 
revise the Rating Schedule. Certainly third-party groups can 
help. But a lot of the expertise in the Rating Schedule lies in 
the VA itself, and maybe people, former VA employees, could 
probably help a good bit. I do not think you can go out and 
hire a contractor to revise the Rating Schedule unless the 
statement of work makes it very clear they are going to have to 
use some people with some true expertise in the area, or they 
are going to come up with something that is politically 
useless, that cannot be implemented.
    And, you know, some of the things that I have seen and some 
of the notes that were passed around about pending legislation 
that I thought were pretty useful were ones that made it clear 
that veterans are grandfathered in--people who had been 
receiving benefits for 20 years and all of that.
    The business about new systems--my concern is that, if we 
are not careful, we are going to wind up with two parallel 
systems that people will be able to hop back and forth based on 
their own volition. And if we do that, I just do not think the 
VA can handle it.
    Senator Burr. I appreciate your observations and thank the 
Chairman for his indulgence. My biggest fear is that, if your 
statement is right, that it would take up to five years to 
totally revamp a rating system--that exceeds a four-year period 
of certainty in Washington, which is called an administration's 
length of term.
    I fear we might be here--I won't be and the Chairman won't 
be here, but some in the room might be--50 years from now. And 
it will, in fact, be us that are quoted talking about changing 
the system and the system will look exactly the same.
    So, I would only say to you and to all who are concerned 
with this, if that is the case, maybe it is time we begin to 
think out of the box as to how we could accomplish this in an 
expeditious way--one that works within the time frames of what 
Washington requires us to work in to get big things done.
    General, I thank you.
    General Scott. Yes, sir.
    Chairman Akaka. Thank you very much, Senator Burr.
    General, I will have some questions to submit for your 
responses and so will Senator Burr and other members, I think, 
of this Committee.
    I want to thank you for your statement and your responses 
to our questions. I thank you for what you are doing and look 
forward to working with you on trying to accomplish some of the 
recommendations that you have mentioned.
    So, thank you.
    General Scott. Yes, sir. I look forward to receiving your 
written questions and we will give you the very best answers we 
can come up with.
    Chairman Akaka. Thank you very much.
    General Scott. Yes, sir. Thank you.
    Chairman Akaka. Now, I welcome our second panel. I am 
pleased that representatives of three advocacy groups have 
agreed to share with us their organizations' views of the 
recommendations of the Veterans' Disability Benefits 
Commission. Included on this panel are Todd Bowers, the 
Director of Government Affairs for the Iraq and Afghanistan 
Veterans of America; Gerald Manar, the Deputy Director of the 
VFW's National Veterans Service, who is presenting the views of 
the Independent Budget VSOs; and Mr. Steve Smithson, who serves 
as the Deputy Director for Claims Service for the National 
Veterans Affairs and Rehabilitation Commission of The American 
Legion.
    I thank all of you for being here today and look forward to 
hearing your perspectives on the Commission's report. Of 
course, your full statements will appear in the record of the 
hearing.
    Mr. Bowers, will you please begin with your statement.

STATEMENT OF TODD BOWERS, DIRECTOR OF GOVERNMENT AFFAIRS, IRAQ 
              AND AFGHANISTAN VETERANS OF AMERICA

    Mr. Bowers. Mr. Chairman and Distinguished Members of the 
Committee, I thank you for inviting me to testify this morning 
on behalf of Iraq and Afghanistan Veterans of America (IAVA).
    Founded in June 2004, the Iraq and Afghanistan Veterans of 
America is the Nation's first and largest nonprofit and 
nonpartisan group dedicated to improving the lives of Iraq and 
Afghanistan veterans and, very importantly, their families.
    Everyday, veterans from the wars in Iraq and Afghanistan 
face serious bureaucratic barriers to receiving fair 
compensation for their injuries. Everyone agrees that action 
must be taken to reform the system. Dozens, perhaps hundreds, 
of plans have been put forth.
    The work of the Veterans' Disability Benefits Commission, 
however, is unique in its scope and its thoroughness. The 
Veterans' Disability Benefits Commission spent years studying 
the intricacies of the disability benefits system, uncovering 
and documenting gaps and flaws in this system, and producing a 
comprehensive document that should act as a road map to the 
veterans' disability benefits reform. At IAVA we actually refer 
to it as the disability benefits reform bible.
    Today, I would like to highlight three recommendations put 
forward by the Commission.
    First, streamlining the disability system: as the 
Commission concluded, there should be one DOD/VA medical 
evaluation and interoperable medical records. The DOD should 
determine fitness for duty and should pay for a military 
pension or severance pay to those found unfit. The VA should 
determine the level of disability to compensate for loss of 
future earnings and quality of life. All of this should be 
communicated through Recommendation 5.21. By establishing a set 
of registries of servicemembers and veterans based on exposure, 
deployment, and disease histories, VA and DOD will finally be 
able to effectively communicate with servicemembers and their 
veterans.
    Second, the entire VA disability benefits schedule should 
be revised. Disability ratings must take better account for the 
signature injuries of the Iraq War--Post Traumatic Stress 
Disorder and Traumatic Brain Injury. The May 2007 report by the 
Institute of Medicine and the National Research Council 
concluded that the VA's PTSD evaluation techniques are 
ineffective. According to the report, the criteria for mental 
disorders are crude, overly general, and unreliable.
    In addition, the report questioned the use of separate 
ratings for mental illnesses that often appear together, things 
like PTSD and depression, the inconsistent criteria for rating 
relapsing/remitting conditions, and the use of occupational 
impairment as the sole metric for PTSD disability.
    Finally, the Rating Schedule should also provide adequate 
compensation for both loss of earning capacity and loss of 
quality of life. Moreover, Congress must address the 
Commission's finding that young veterans are undercompensated. 
While such a system is being put in place, IAVA recommends that 
the compensation rates are increased while the Rating Schedule 
is being revised, as recommended by the VDBC.
    The question remains, however, whether and how these and 
other valuable recommendations will be implemented. Our concern 
is that the Commission's recommendations will join the work of 
many other Commissions before them, collecting dust on a shelf. 
It is for that reason that we believe one of the most important 
recommendations of the Commission is their final one. Congress 
should establish an executive oversight group to ensure timely 
and effective implementation of the Commission's 
recommendations.
    Along with the recommendations of the Dole-Shalala 
Commission, the work of the GAO, and other government oversight 
agencies, Congress has been presented with effective solutions 
to many of the problems facing today's wounded warriors. It is 
up to you to take bipartisan action.
    By instituting an executive oversight group, Congress and 
the veterans' community can be assured that troops and veterans 
are getting the care they have so rightfully earned.
    And I would also like to drive back from this that in my 
personal experience just three years ago, on my second tour, 
when I was wounded in Iraq, when I was shot in the face by a 
sniper, I never thought that I would be someone who was 
involved with the disability ratings system.
    For the past eight months I have seen what going from a vet 
center, through the VA, to understanding what the system is. I 
will be honest with you; it is extremely difficult. My in-box 
is filled with some of my junior Marines asking me, ``Sergeant 
Bowers, how do I do this? I know you are going through it.'' My 
answer to them is always, ``It is extremely complex, but I 
promise you, as a Nation we are working on fixing these 
things.''
    And I cannot express enough how concerned we are at IAVA 
that many of these recommendations are, as I mentioned, going 
to be put on a shelf to collect dust. I have reviewed 11 
Commissions that have been established since 1993 with upwards 
of 1,000 recommendations and many of those have not been 
implemented. It is going to be imperative that Congress take 
the time to look at everything that they have provided for you. 
They have given you the ammunition. You have got the rifle, you 
have got the target, squeeze the trigger and let us get these 
implemented as soon as possible.
    I am open to any questions that you may have afterwards. 
Thank you, Mr. Chairman.
    [The prepared statement of Mr. Bowers follows:]
Prepared Statement of Todd Bowers, Director of Government Affairs, Iraq 
                  and Afghanistan Veterans of America
    Mr. Chairman and Distinguished Members of the Committee, I thank 
you for inviting me to testify this morning on behalf of Iraq and 
Afghanistan Veterans of America. Founded in June 2004, Iraq and 
Afghanistan Veterans of America is the nation's first and largest 
nonprofit and nonpartisan group dedicated to improving the lives of 
Iraq and Afghanistan veterans and their families.
    Every day, veterans from the wars in Iraq and Afghanistan face 
serious bureaucratic barriers to receiving fair compensation for their 
injuries. Everyone agrees that action must be taken to reform the 
system. Dozens, perhaps hundreds, of plans have been put forth. The 
work of the Veterans Disability Benefits Commission, however, is unique 
in its scope and its thoroughness. The VDBC spent years studying the 
intricacies of the disability benefits system, uncovering and 
documenting gaps and flaws in this system, and producing a 
comprehensive document that should act as a road map to veterans' 
disability benefits reform.
    Today, I would like to highlight three key recommendations put 
forward by the Commission.
    First, streamlining the disability system. As the Commission 
concluded, there should be one DOD/VA medical evaluation and 
interoperable medical records. The DOD should determine fitness for 
duty, and should pay for a military pension or severance pay to those 
found unfit. The VA should determine the level of disability to 
compensate for loss of future earnings and quality of life. All of this 
should be communicated through Recommendation 5.21 by establishing a 
set of registries of servicemembers and veterans based on exposure, 
deployment, and disease histories VA and DOD will finally be able to 
effectively communicate with servicemembers and veterans.
    Second, the entire VA disability benefits schedule should be 
revised. Disability ratings must take better account for the signature 
injuries of the Iraq War--PTSD and TBI. The May 2007 report by the 
Institute of Medicine and the National Research Council concluded that 
the VA's PTSD evaluation techniques are ineffective. According to the 
report, the criteria for mental disorders are ``crude,'' ``overly 
general,'' and unreliable. In addition, the report questioned the use 
of separate ratings for mental illnesses that often appear together 
(like PTSD and depression), the inconsistent criteria for rating 
relapsing/remitting conditions, and the use of ``occupational 
impairment'' as the sole metric for PTSD disability.
    Finally, the Rating Schedule should also provide adequate 
compensation for both loss of earning capacity and loss of quality of 
life. Moreover, Congress must address the Commission's finding that 
young veterans are undercompensated. While such a system is being put 
in place, IAVA recommends that compensation rates are increased while 
the Rating Schedule is revised, as recommended by the Veterans' 
Disability Benefits Commission.
    The question remains, however, whether and how these and other 
valuable recommendations will be implemented. Our concern is that the 
Commission's recommendations will join the work of many other 
commissions before them--collecting dust on a shelf. It is for that 
reason that we believe the most important recommendation of the 
Commission is their final one:

        Congress should establish an executive oversight group to 
        ensure timely and effective implementation of the Commission 
        recommendations.

    Along with the recommendations of the Dole-Shalala Commission and 
the work of the GAO and other government oversight agencies, Congress 
has been presented with effective solutions to many of the problems 
facing today's wounded warriors. It is up to you to take bipartisan 
action.
    By instituting an executive oversight group, Congress and the 
veterans' community can be assured that troops and veterans are getting 
the care they have earned.

    Chairman Akaka. Thank you very much, Mr. Bowers.
    Mr. Manar.

    STATEMENT OF GERALD T. MANAR, DEPUTY DIRECTOR, NATIONAL 
VETERANS SERVICE, VETERANS OF FOREIGN WARS OF THE UNITED STATES

    Mr. Manar. Chairman Akaka, Ranking Member Burr, thank you 
for this opportunity to address you this morning. I am pleased 
to provide the views of the members of the Independent Budget--
AMVETS, Disabled American Veterans, Paralyzed Veterans of 
America, and the Veterans of Foreign Wars of the United 
States--on the findings and recommendations of the Veterans' 
Disability Benefits Commission concerning the current 
disability compensation system.
    During its two and one-half years, the VDBC held 55 days of 
hearings, heard testimony from hundreds of individuals, experts 
and organizations, commissioned two major studies from the 
Institute of Medicine, surveyed thousands of veterans, 
survivors, service officers and VA employees and, through the 
Center of Naval Analysis, analyzed income data from millions of 
veterans.
    Except for administrative matters, all of its work was done 
out in the open where the harsh light of public scrutiny could, 
and did, illuminate its deliberations and conclusions.
    While the Commission's final report offered 113 
recommendations, we will focus our testimony on its 
recommendations dealing with the disability compensation 
program. Specifically, today we will discuss the Schedule for 
Rating Disabilities, quality of life, and individual 
unemployability.
    The current Rating Schedule is the latest of a long line of 
disability evaluation tools going back nearly a hundred years. 
The Commission found that the Rating Schedule has been revised, 
often substantively, since 1945. Still, sections of it have 
been rarely touched and parts are significantly out of date.
    To address this problem, the Commission adopted a number of 
recommendations advanced by an Institute of Medicine Committee 
it commissioned to study the Rating Schedule. The IOM suggested 
that VA should create a permanent disability advisory 
committee, staffed with experts in medical care, disability 
evaluation, functional and vocational assessment and 
rehabilitation, and include representatives of the health 
policy, disability law, and veterans' communities to oversee 
and methodically update the Ratings Schedule.
    We strongly support this recommendation and believe it is 
essential that the advisory committee working should be fully 
open and transparent.
    It is our considered belief, based on our long and detailed 
experience with evaluating veterans' disabilities, that it will 
take years of hard work by a competent staff comprised of 
experts in a variety of medical and legal disciplines to 
develop new rating criteria that accurately assess service-
connected disabilities.
    We agree with the VDBC that the initial research, review, 
and revision of the Rating Schedule should be completed within 
a five-year period. Considering the complexity of the task, we 
believe that any attempt to complete this project in 
significantly less time will produce a significantly flawed 
document.
    Revision of the Rating Schedule cannot be a one-time 
project. A permanent on-going process must be devised and put 
in place to ensure that you and your successors, and I and 
mine, never again have to discuss why the primary tool for 
assessing veterans' disabilities is inadequate and antiquated.
    In reviewing the disability compensation program, the VDBC 
did more than just look at the Rating Schedule. It commissioned 
original research into whether current levels of compensation 
adequately replace, on average, lost earnings of veterans with 
service-connected disabilities when compared to non-disabled 
veterans. Much to the surprise of nearly everyone, the Center 
for Naval Analysis determined that current levels of 
compensation, with the exception of three groups referenced in 
my written statement, are fairly accurate for most groups of 
veterans.
    It is our view that no matter how well a prosthetic leg 
allows someone to walk, how durable an artificial knee is or 
how much progress therapy and drugs allows a TBI veteran to 
function, the fact is that these men and women suffer much more 
than mere economic loss. They are deprived of the opportunity 
to live their lives at the same high level and do the same 
things that they could have done had they not been injured in 
the service of their country.
    That is why we support the Commission's recommendation to 
revise the Rating Schedule to take into account the impact that 
service-connected disabilities have on a veteran's quality of 
life.
    We support the VDBC recommendations that call for extensive 
studies of the impact that service-connected disabilities have 
on the quality of life of veterans and urge Congress to 
authorize increased compensation, either as a component of each 
evaluation or as a separate payment in addition to compensation 
already payable. Until this is accomplished, we support the 
Commission's recommendation to increase compensation levels by 
up to 25 percent to take into account the effect of loss of 
quality of life resulting from service-connected disabilities.
    Individual unemployability is the one provision in the 
Rating Schedule that allows VA to take individual circumstances 
such as education, employment experiences and other facts into 
consideration when deciding whether service-connected 
disabilities keep a veteran from working.
    This single provision concedes that some people can be made 
more disabled by certain disabilities than others. This 
provision requires VA to exercise judgment to determine if a 
veteran is made totally disabled by their service-connected 
disabilities.
    In light of this, we support the recommendation of the 
Commission to modify evaluative criteria--especially for 
psychiatric conditions and injuries causing cognitive 
dysfunction--to recognize that such injuries are far more 
disabling than previously thought. Most importantly this will 
provide for a more appropriate level of compensation for this 
Nation's defenders who are so stricken.
    We also believe that more appropriate evaluations will 
eventually reduce the number of veterans who are awarded 
individual unemployability.
    We strongly oppose the wholesale elimination of this one 
provision that allows VA to compensate the individual veteran 
when service-connected disabilities make employment impossible.
    Mr. Chairman and Senator Burr, thank you for the 
opportunity to appear before you today. I will be pleased to 
answer any questions that you may have.
    [The prepared statement of Mr. Manar follows:]
   Prepared Statement of Gerald T. Manar, Deputy Director, National 
    Veterans Service, Veterans of Foreign Wars of the United States
    Mr. Chairman and Members of the Committee, thank you for this 
opportunity to provide the views of the members of the Independent 
Budget--AMVETS, Disabled American Veterans, Paralyzed Veterans of 
America, and the Veterans of Foreign Wars of the United States--on the 
findings and recommendations of the Veterans' Disability Benefits 
Commission (VDBC) concerning the current disability compensation 
system.
    The Veterans' Disability Benefits Commission (VDBC) was created by 
Public Law 108-136, the National Defense Authorization Act of 2004. It 
began meeting in May 2005 and concluded its work in October 2007. In 
the first two years it met nearly every month for two days, and in its 
final six months usually met twice a month for three days. It took 
testimony from hundreds of people and scores of organizations. It 
conducted site visits at VA and military facilities around the nation 
and met with hundreds of veterans in public forums. Except for 
administrative matters, all of its work was done out in the open where 
the harsh light of public scrutiny could, and did, illuminate its 
deliberations and conclusions.
    Many of us who serve our Nation's veterans were initially skeptical 
of the Commission's mission. During the first several hearings it 
became evident that many veterans viewed the Commission as a tool of 
those who were intent on dialing back and dismantling elements of the 
disability compensation program. Sometimes harsh and critical words 
were spoken in those early hearings. Chairman Scott reacted as a former 
General would, often giving as good as he got.
    In time, however, critics grew silent as the Commissioners began to 
demonstrate by their actions that they did not have secret marching 
orders; they took their mission seriously, they were interested in all 
views and, most importantly, were not afraid to modify their positions 
when the evidence was compelling.
    As we stated in our testimony before this Committee on October 17, 
2007, we do not agree with all the recommendations of the VDBC. 
However, as we said, ``the Veterans Disability Benefits Commission has 
exhaustively examined the current compensation program, affirmed its 
strengths and pushed forward many thoughtful and constructive 
recommendations for evolving it into a mechanism to better serve 
America's new generations of veterans. Their approach is to retain the 
best parts of the disability compensation program and create a process 
for measured and deliberate reform and improvement.''
    While the Commission's final report offers over 130 recommendations 
covering areas as diverse as the transition from service to civilian 
life, medical care, concurrent receipt, disability compensation, and 
survivor's benefits, we will focus our testimony on its recommendations 
dealing with the disability compensation program. Specifically, today 
we will discuss the Schedule for Rating Disabilities, quality of life, 
and individual unemployability.
                    schedule for rating disabilities
    Service-connected disabilities are evaluated using criteria 
contained in Part 4 of title 38 Code of Federal Regulations. The 
current Rating Schedule is the fourth iteration of a rating scheme 
first devised in 1925. The Commission discusses the various rating 
schedules in great detail in its report and it will not be repeated 
here.
    Many critics of the current Rating Schedule allege that it has not 
been substantively revised since its last major overhaul in 1945. While 
the Commission found that the Rating Schedule has been revised, often 
substantively, since 1945, sections of it have been rarely touched and 
many parts contain medical terminology and evaluative criteria which 
are significantly out of date.
    VA is charged with administering a compensation program that pays 
veterans in excess of $30 billion per year for disabilities arising as 
a result of or coincident with military service. Yet the VBA 
Compensation and Pension Service has fewer than 140 people including 
support staff assigned to run this program. When the 26 employees 
assigned to conduct quality reviews of various types are subtracted, 
along with the 28 people figuring out how to make computer software 
work more efficiently, the remaining 86 are spread too thin to do most 
jobs adequately. For many years in the late 1990's only one person was 
assigned to review, revise and update the Rating Schedule. It is little 
wonder that many sections of the Rating Schedule are not up to date.
    To address this problem, the Commission adopted a number of 
recommendations advanced by an Institute of Medicine Committee (IOM) 
that the Commission had contracted with to study the disability 
evaluation of veterans. In its report, A 21st Century System for 
Evaluating Veterans for Disability Benefits, the IOM suggested that VA 
should create a permanent disability advisory committee, ``staffed with 
experts in medical care, disability evaluation, functional and 
vocational assessment and rehabilitation, and include representatives 
of the health policy, disability law, and veteran communities.'' The 
Advisory Committee would meet regularly and offer direction and 
oversight to the regular review and updating of the Rating Schedule. In 
addition to this Committee, the IOM recommended that VA substantially 
increase the number of staff members permanently assigned to 
accomplishing the changes directed by the Advisory Committee.
    We support these recommendations and believe that its first task 
should be to recommend a change in the criteria for evaluating Post 
Traumatic Stress Disorder (PTSD). Concurrently, it could begin the 
process of reviewing and suggesting changes to those sections of the 
Rating Schedule that have not been updated in the last 10 years.
    Some critics of the current disability compensation program have 
suggested that the Rating Schedule can be thoroughly and completely 
reviewed and updated in as little as six months. As I testified on 
October 17, 2007, anyone can revise the Rating Schedule in a few weeks 
or months. However, the result will simply be a different Rating 
Schedule. It is our considered belief, based on our long and detailed 
experience with evaluating veterans' disabilities, that it will take 
years of hard work by a competent staff of medical, vocational and 
legal experts to devise new rating criteria for all the body systems 
which allows for the accurate assessment of service-connected 
disabilities.
    Revision of the Rating Schedule cannot be a one-time project. A 
permanent process must be devised and put in place to ensure that you 
and your successors, and I and mine, never again have to discuss why 
the primary tool for assessing veterans disabilities is inadequate and 
antiquated.
                            quality of life
    In reviewing the disability compensation program, the VDBC did more 
than just look at the Rating Schedule. It commissioned original 
research into whether current levels of compensation adequately 
replace, on average, lost earnings of veterans with service connected 
disabilities when compared to non-disabled veterans. Much to the 
surprise of nearly everyone, the Center for Naval Analysis (CNA) 
determined that current levels of compensation are fairly accurate for 
most groups of veterans. There were, however, three groups for which 
compensation fell significantly short of replacing average lost 
earnings: veterans with psychiatric disabilities were under compensated 
regardless of the evaluation assigned, those veterans evaluated 100 
percent disabled at a young age and among those granted individual 
unemployability.
    So the CNA determined that current levels of compensation replaced 
average lost earnings for most veterans. However, losing a hand or 
foot, acquiring an arthritic knee, or suffering a Traumatic Brain 
Injury is not the same as suffering an economic loss that some court 
can remedy by awarding the plaintiff a judgment. When someone suffers a 
permanent disability while serving their country the injury suffered is 
more than loss of earnings capacity. No matter how well a prosthetic 
leg allows someone to walk or how durable an artificial knee is or how 
much progress therapy and drugs allows a TBI veteran to function, the 
fact is that these men and women suffer much more than an economic 
loss. They are deprived of the opportunity to live their lives at the 
same high level and do the same things they could have done had they 
not been injured.
    That is why we support the Commission's recommendation to revise 
the Rating Schedule to take into account the impact that service-
connected disabilities have on a veteran's quality of life. We 
recognize that Special Monthly Compensation (SMC) already compensates 
some veterans, at least to some extent, for the effects disabilities 
have on their quality of life. However, most SMC is focused on those 
with obvious disabilities such as missing limbs, vision or hearing. 
Special Monthly Compensation is also available for the most seriously 
disabled of service-connected veterans. However, SMC is only a 
component of a few disabilities listed in the Rating Schedule, even 
though every compensable evaluation acknowledges that there is loss of 
earnings capacity and, by implication, at least some impact on quality 
of life.
    We support the VDBC recommendations that call for extensive studies 
of the impact that service-connected disabilities have on the quality 
of life of veterans and urge Congress to authorize increased 
compensation, either as a component of each evaluation or as a separate 
payment in addition to compensation already payable. Until such 
detailed studies can be conducted and evaluations adjusted to reflect 
the loss of quality of life as a result of service-connected 
disabilities, we support the Commission's recommendation to increase 
compensation levels by up to 25 percent to take into account the effect 
of loss of quality of life resulting from service-connected 
disabilities.
                       individual unemployability
    The compensation program was intentionally designed to assess a 
veteran's symptoms resulting from service-connected disabilities and 
provide compensation based on the average loss of earnings capacity. It 
was not designed to determine what the actual lost earnings would be 
for you or me, the special circumstances of any one veteran; the 1925 
Rating Schedule attempted to do that and failed miserably. Such a 
computation must fail because the government does not have the time, 
staffing or expertise to compute lost earnings for any particular 
individual when they leave service or throughout their life as 
education, occupation, geographic location marital status, and other 
life events occur.
    In a sense, then, the evaluation of disabilities and the payment of 
compensation are decisions that can be made in almost a cookie cutter 
fashion. The problem, however, is that no two people are alike. A 
former colleague of yours, Max Cleland lost three extremities in 
service. By determination, hard work, perseverance and exceptional 
ability, he eventually became the Administrator of Veterans Affairs and 
a U.S. Senator. These same horrific injuries would cause many other 
people to be totally disabled.
    Individual unemployability is the one provision in the Rating 
Schedule that allows VA to take individual circumstances such as 
education, employment experiences and other facts into consideration 
when deciding whether service-connected disabilities keep someone from 
working. This single provision concedes that some people can be made 
more disabled by certain disabilities than others. This provision 
requires VA to exercise judgment to determine if a veteran is made 
totally disabled by their service-connected disabilities. The fact that 
VA can exercise judgment in awarding total benefits based on individual 
unemployability is what sometimes suggests apparent disparities in the 
application of the law.
    Research conducted by the CNA and studies undertaken by the IOM 
reveal several facts about individual unemployability. First, the CNA 
found no evidence that any significant number of veterans were gaming 
the system to obtain individual unemployability. Second, the IOM found 
that the rapid increase in the award of individual unemployability to 
veterans with mental conditions in recent years stems largely from 
inadequate rating criteria. Finally, the CNA also concluded that the 
significant increase in recent years in the award of individual 
unemployability was caused by shifting demographics in the disabled 
veteran population.
    Based on data developed by the CNA, the Commission recommended that 
as VA examines and revises the Rating Schedule it should consider 
adjusting the criteria used to evaluate select disabilities to better 
recognize that some are more disabling then previously understood. This 
action should result in more appropriate scheduler evaluations and a 
reduced need to resort to individual unemployability to ensure that 
compensation is correct.
    We support the recommendation of the Commission to modify 
evaluative criteria, especially for psychiatric conditions, to 
recognize that some symptom patterns are more disabling than previously 
thought. We believe that more appropriate evaluations will reduce the 
number of instances where the individual unemployability provisions 
must be used. However, we strongly oppose the wholesale elimination of 
this one provision that allows VA to compensate the individual veteran 
when service-connected disabilities make employment impossible.
    In addition, we do not oppose a requirement that those seeking a 
total evaluation based on individual unemployability should undergo a 
vocational assessment, provided that it does not delay the decision. In 
our experience, veterans who seek individual unemployability have been 
unemployed for months or years before they approach the VA for help. 
Imposing an additional test that would delay a decision could, and 
often would, have serious ramifications for the men and women who 
became disabled while in the service of their Nation.
    Thank you for the opportunity to appear before you today. I will be 
pleased to answer any questions you may have.

    Chairman Akaka. Thank you very much, Mr. Manar.
    Now, we will hear from Mr. Smithson.

STATEMENT OF STEVE SMITHSON, DEPUTY DIRECTOR, VETERANS AFFAIRS 
       AND REHABILITATION COMMISSION, THE AMERICAN LEGION

    Mr. Smithson. Mr. Chairman and Ranking Member Burr, thank 
you for the opportunity to present The American Legion's views 
on the recommendations of the Veterans' Disability Benefits 
Commission with respect to the current disability compensation 
system.
    As noted in my written statement, the veterans community 
was initially leery of the Veterans' Disability Benefits 
Commission, given the history surrounding its creation, as well 
as the fact that key members of Congress and others publicly 
touted the Commission as a vehicle for radical changes in the 
VA disability system, changes that would negatively impact and 
restrict entitlement to benefits for a large number of 
veterans.
    American Legion staff closely followed the Commission's 
activities and provided written and oral testimony, as well as 
other input, throughout the Commission's existence. From the 
very beginning, Commission Chairman General Scott assured the 
VSOs and others that the Commission did not have a hidden 
agenda and its purpose was not to cut or otherwise restrict 
veterans' benefits. During the course of the Commission's two 
and one-half year study, The American Legion's concerns 
diminished and our skepticism turned to optimism as the release 
of its final report approached.
    The final report--the culmination of an exhaustive study of 
veterans' benefits--is extremely thorough and its 
recommendations set forth a commonsense approach to addressing 
many of the problems plaguing the veterans' compensation 
system. We appreciate the Commission's hard work and commitment 
and we are generally pleased with its recommendations.
    My written statement focuses, for the most part, on 
recommendations that will directly impact the disability 
compensation system, as well as those addressed as high 
priority in the Executive Summary. At this time I will briefly 
highlight The American Legion's position regarding some of 
these recommendations.
    The American Legion fully supports the Commission's 
recommendations regarding line of duty, time limit to file a 
claim, lump sum payments and reasonable doubt. We are hopeful 
that the Commission's thorough study of these issues and 
subsequent recommendations will put an end to further proposals 
to change current policies.
    We are, however, disappointed with the Commission's 
recommendation regarding character of discharge and strongly 
oppose any change to the current standard that allows 
eligibility to VA benefits based on separate periods of 
honorable service.
    Regarding Recommendations 7-4 and 7-5 pertaining to 
individual unemployability, The American Legion supports the 
gradual reduction in compensation benefits of veterans who are 
able to return to substantially gainful employment rather than 
abruptly terminating benefits at an arbitrary level of earning. 
But, we strongly oppose the portion of the recommendation that 
could be interpreted as requiring consideration of age in 
determining entitlement to this benefit. We are also extremely 
leery of the recommendation that encourages the elimination of 
the current IU benefit on the anticipation of a revised Rating 
Schedule that would supposedly eliminate the need for that 
benefit.
    The American Legion is supportive of initiatives to 
expedite the claims process and reduce the claims backlog but 
we do not support imposing arbitrary deadlines to accomplish 
this goal as proposed in Recommendation 9-1 because experience 
has shown that such production driven efforts have a tendency 
to sacrifice quantity over quality, often resulting in more 
errors, and, ultimately, an increase in appeals.
    The American Legion also supports the development of rating 
criteria specific to Post Traumatic Distress Order. The Rating 
Schedule currently uses one set of rating criteria for all 
mental disorders. There are unique aspects of PTSD that are not 
properly evaluated by the current rating criteria and it makes 
sense to develop rating criteria that address the specific 
symptoms involved with PTSD.
    Finally, The American Legion does not support 
recommendations that would replace the current association 
standard in the presumption determination process with the more 
stringent causal effect standard. The association standard is 
consistent with the non-adversarial and liberal nature of the 
VA disabilities claims process.
    Moreover, as in the case of the 1991 Gulf War, there is 
often a lack of specific or reliable exposure data due to 
improper recordkeeping, resulting in a lack of reliable 
exposure data. During Operations Desert Shield and Storm, there 
was insufficient information to properly determine 
servicemember exposure to the numerous environmental and other 
hazards U.S. troops were exposed to within the Southwest Asia 
theater of operations during the war. The lack of such data 
would clearly diminish the value and reliability of the 
causation standard as recommended by the Institute of Medicine 
and endorsed by the Commission.
    Even the Commission, despite its recommendation, noted it 
was concerned that causation, rather than association, may be 
too stringent and encouraged further study of the matter.
    Mr. Chairman, that concludes my statement. I would be happy 
to answer any questions at this time.
    [The prepared statement of Mr. Smithson follows:]
Prepared Statement of Steve Smithson, Deputy Director, Veterans Affairs 
           and Rehabilitation Commission, The American Legion
    Mr. Chairman and Members of the Committee, thank you for this 
opportunity to present The American Legion's views on the 
recommendations of the Veterans' Disability Benefits Commission (VDBC 
or Commission) with respect to the current disability compensation 
system.
    Due to the history surrounding the establishment of the Commission, 
The American Legion and others in the veteran service organization 
(VSO) community feared that it would be used as a tool to restrict 
veterans' benefits. In fact, key members of Congress and other 
government officials publicly expressed their desire to use the VDBC as 
a vehicle to institute radical changes in the VA disability system that 
would negatively impact and restrict entitlement to benefits for a 
large number of veterans.
    Concerned about the questionable history surrounding the creation 
of the VDBC and the impact its recommendations would undoubtedly have 
on VA's disability compensation program, American Legion staff closely 
monitored the Commission's activities and provided written and oral 
testimony, as well as other input, on several occasions. From the very 
beginning, Commission Chairman Terry Scott assured the VSOs and others 
that the Commission did not have a hidden agenda and its purpose was 
not to cut or otherwise restrict veterans' benefits. During the course 
of the Commission's two and one-half-year study, The American Legion's 
concerns diminished and our skepticism turned to optimism as the 
release of its final report approached. Our approach, however, is still 
``trust but verify.''
    The American Legion appreciates the Commission's hard work and 
commitment and we are generally pleased with its recommendations. As 
the final report contains 113 recommendations, this statement will 
focus, for the most part, on recommendations that will directly impact 
the disability compensation system as well as those addressed as high 
priority in the Executive Summary.
               executive summary priority recommendations
Recommendation 4-23 (Chapter 4, Section I.5)
    VA should immediately begin to update the current Rating Schedule, 
beginning with those body systems addressing the evaluation and rating 
of Post Traumatic Stress Disorder (PTSD) and other mental disorders and 
of Traumatic Brain Injury (TBI). Then proceed through the other body 
systems until the Rating Schedule has been comprehensively revised. The 
revision process should be completed within 5 years. VA should create a 
system for keeping the Rating Schedule up to date, including a 
published schedule for revising each system.

    American Legion Position. Most major body systems in the Rating 
Schedule have been updated over the last few years. The American Legion 
supports the updating of conditions such as TBI that have not been 
recently updated. We wish to also note that the Rating Schedule is not 
the major cause of problems with the VA disability compensation 
process. VA problems such as inadequate staffing, inadequate funding, 
ineffective quality assurance, premature adjudications, and inadequate 
training still plague the VA regional offices. The American Legion 
wants to emphasize that, in most cases, it would be inappropriate to 
reduce the value of a disability as long as our troops are in harm's 
way.
Recommendation 5-28 (Chapter 5, Section III.3)
    VA should develop and implement new criteria specific to Post 
Traumatic Stress Disorder in the VA Schedule for Rating Disabilities. 
VA should base those criteria on the Diagnostic and Statistical Manual 
of Mental Disorders and should consider a multidimensional framework 
for characterizing disability due to Post Traumatic Stress Disorder.

    American Legion Position. The Rating Schedule currently uses one 
set of rating criteria for all mental disorders. There are unique 
aspects of PTSD that are not properly evaluated by the current rating 
criteria and it makes sense to develop rating criteria that address the 
specific symptoms involved with PTSD.
Recommendation 5-30 (Chapter 5, Section III.3)
    VA should establish a holistic approach that couples Post Traumatic 
Stress Disorder treatment, compensation and vocational assessment. 
Reevaluation should occur every 2-3 years to gauge treatment 
effectiveness and encourage wellness.

    American Legion Position. While The American Legion supports a 
holistic approach to the treatment and compensation of PTSD that 
encourages wellness, we are concerned that a mandatory reevaluation 
every 2-3 years could result in undue stress among PTSD service-
connected veterans. They may be fearful that the sole purpose of such 
reevaluation would be to reduce compensation benefits. This perception 
could undermine the treatment process. We would, therefore, encourage 
study and review of possible unintended consequences regarding this 
portion of the Commission's recommendation.
Recommendation 6-14 (Chapter 6, Section IV.2)
    Congress should eliminate the ban on concurrent receipt for all 
military retirees and for all servicemembers who separated from the 
military due to service-connected disabilities. In the future, priority 
should be given to veterans who separated or retired from the military 
under Chapter 61 with:

     fewer than 20 years service and a service-connected 
disability rating greater than 50 percent, or
     disability as the result of combat.

    American Legion Position. The American Legion strongly supports 
full concurrent receipt and we are pleased with that portion of the 
recommendation.
Recommendation 7-4 (Chapter 7, Section II.3)
    Eligibility for Individual Unemployability should be consistently 
based on the impact of an individual's service-connected disabilities, 
in combination with education, employment history, and medical effects 
of an individual's age or potential employability. VA should implement 
a periodic and comprehensive evaluation of Individual Unemployability-
eligible veterans. Authorize a gradual reduction in compensation for 
Individual Unemployability recipients who are eligible to return to 
substantially gainful employment rather than abruptly terminating 
disability payments at an arbitrary level of earning.

    American Legion Position. Although The American Legion supports the 
provision of this recommendation calling for the gradual reduction in 
compensation benefits for Individual Unemployability (IU) recipients 
who are able to return to substantially gainful employment, we strongly 
oppose the portion of the recommendation that could be interpreted as 
requiring the consideration of age in determining eligibility to IU. It 
is inherently unfair to punish an older veteran who would not be able 
to work at any age because of a service-connected condition while 
awarding the benefit to a similarly disabled younger veteran. The 
current rule states (in essence) that the impact of a service-connected 
condition on a veteran cannot be evaluated to a higher degree because 
the veteran is old. 38 CFR Sec. 3.341(a). The schedule is based on the 
average impairment in earning capacity. If the veteran cannot work 
because of service-connected disability(s) then IU should be awarded. 
Moreover, we have found that younger veterans have to overcome VA bias 
when they apply for IU because VA raters think that younger people have 
a better chance of going back to work. Thus, allowing age to be used as 
a factor in determining eligibility for IU purposes may end up 
adversely impacting both older and younger veterans.
Recommendation 7-5 (Chapter 7, Section II.3)
    Recognizing that Individual Unemployability is an attempt to 
accommodate individuals with multiple lesser ratings, but who remain 
unable to work, the Commission recommends that as the ``VA Schedule for 
Rating Disabilities'' is revised, every effort should be made to 
accommodate such individuals fairly within the basic rating system 
without the need for an Individual Unemployability rating.

    American Legion Position. The American Legion is extremely leery of 
any recommendation that would encourage the elimination of a specific 
benefit program on the anticipation of a revised Rating Schedule that 
would supposedly eliminate the need for that benefit. The current 
policy as enunciated by 38 CFR Sec. 3.340 states, ``[T]otal disability 
will be considered to exist when there is present any impairment of 
mind or body which is sufficient to render it impossible for the 
average person to follow a substantially gainful occupation.'' This 
policy is fair and consistent with the non-adversarial nature of the VA 
claims process. Therefore, this policy should not be altered.

  38 CFR Sec. 4.16b states:

        (b) It is the established policy of the Department of Veterans 
        Affairs that all veterans who are unable to secure and follow a 
        substantially gainful occupation by reason of service-connected 
        disabilities shall be rated totally disabled.

    The bottom line is that veterans who are unable to work due to 
service-connected disability should be compensated at the 100% level, 
whether it be based on a schedular evaluation (either single service-
connected disability or a combined schedular evaluation) or based on 
Individual Unemployability. This has been a longstanding VA policy and 
we see no need to change it. See 38 CFR Sec. 3.340.
Recommendation 7-6 (Chapter 7, Section III.2)
    Congress should increase the compensation rates up to 25 percent as 
an interim and baseline future benefit for loss of quality of life, 
pending development and implementation of quality of life measure in 
the Rating Schedule. In particular, the measure should take into 
account the quality of life and other non-work related effects of 
severe disabilities on veterans and family members.

    American Legion Position. The American Legion supports an increase 
in compensation benefits to adequately account for a service-connected 
disability's impact on a veteran's quality of life. Before any change 
is made, however, we would like to carefully analyze how this would 
impact special monthly compensation, which is based, in part, on loss 
of quality of life.
Recommendation 7-8 (Chapter 7, Section III.2)
    Congress should consider increasing special monthly compensation 
(SMC), where appropriate, to address the more profound impact on 
quality of life by disabilities subject to special monthly compensation 
and review ancillary benefits to determine where additional benefits 
could improve a disabled veteran's quality of life.

    American Legion Position. The American Legion fully supports 
increasing special monthly compensation to address profound impacts on 
quality of life for disabilities subject to SMC, as well as reviewing 
ancillary benefits for the purpose of determining where additional 
benefits could improve a disabled veteran's quality of life.
Recommendation 7-12 (Chapter 7, Section V.3)
    VA and DOD should realign the disability evaluation process so that 
the Services determine fitness for duty, and servicemembers who are 
found unfit are referred to VA for disability rating. All conditions 
that are identified as part of a single, comprehensive medical 
examination should be rated and compensated.

    American Legion Position. The American Legion has long been 
concerned with low disability ratings issued by the military's 
disability evaluation system and we fully support limiting the 
military's role to determination of fitness while leaving the rating 
process to the Department of Veterans Affairs. We do, however, have 
concerns as to how this extra work for the VA would be funded.
Recommendation 7-13 (Chapter 7, Section VI)
    Congress should enact legislation that would bring the ancillary 
and special purpose benefits to levels originally intended considering 
cost of living and provide for annual adjustments to keep pace with the 
cost of living.

    American Legion Position. This recommendation is appropriate, as 
ancillary and special purpose benefits, as reflected in the VDBC's 
report, have not been adjusted to keep pace with cost of living changes 
resulting in the failure of the benefits to fulfill their intended 
purposes.
Recommendation 8-2 (Chapter 8, Section III.1B)
    Congress should eliminate the Survivor Benefit/Dependency and 
Indemnity Compensation offset for survivors of retirees and in-service 
deaths.

    American Legion Position. The American Legion fully supports this 
recommendation.
Recommendation 9-1 (Chapter 9, Section II.6.A.b)
    Improve claims cycle time by:

     Establishing a simplified and expedited process for well 
documented claims, using best business practices and maximum feasible 
use of information technology; and
     Implementing an expedited process by which the claimant 
can state the claim information is complete and waive the time period 
(60 days) allowed for further development.

    Congress should mandate and provide appropriate resources to reduce 
the VA claims backlog by 50% within 2 years.

    American Legion Position. While we are fully supportive of 
initiatives to expedite the claims process and reduce the claims 
backlog. The American Legion, however, is not supportive of imposing 
arbitrary deadlines to reduce the claims backlog because experience has 
shown that such production-driven efforts have a tendency to sacrifice 
quality for quantity, resulting in more errors and, ultimately, an 
increase in appeals. Additionally, while we support an expedited 
process to grant benefits, compliance with statutory duties to assist 
and notify must be fully complied with in claims in which benefits 
would be denied. An immediate reduction in the backlog could be 
accomplished by VA management encouraging VA raters to grant benefits 
when there is sufficient evidence in the record rather than developing 
the record to support a denial.
Recommendation 10-11 (Chapter 10, Section VII)
    VA and DOD should expedite development and implementation of 
compatible information systems including a detailed project management 
plan that includes specific mile and lead agency assignment.

    American Legion Position. The American Legion supports this 
recommendation.
Recommendation 11-1 (Chapter 11)
    Congress should establish an oversight group to ensure timely and 
effective implementation of the Commission's recommendations. This 
group should be co-chaired by VA and DOD and consist of senior 
representatives from appropriate departments and agencies. It is 
further recommended that the Veterans' Affairs Committees hold hearings 
and require annual reports to measure and assess progress.

    American Legion Position. The American Legion has no objections to 
this recommendation. We do, however, urge that this recommendation be 
amended to specifically address VSO participation in this oversight 
process.
                         other recommendations
Recommendation 5-1 (Chapter 5, Section I.1)
    Congress should change the character-of-discharge standard to 
require that when an individual is discharged from his or her last 
period of active service with a bad conduct or dishonorable discharge, 
it bars all benefits.

    American Legion Position. The American Legion strongly opposes this 
recommendation. The Commission voted twice not to recommend a change to 
the current 30-year old policy that allows eligibility for VA benefits 
based on separate honorable periods of service. The VDBC finally 
decided on this position after a third vote of 8-4. We are disappointed 
in not only the recommendation, but also the nature in which the 
Commission arrived at its decision.
    As noted in the VDBC's report, it is clear from a review of the 
legislative history that Congress intended to liberalize the overly-
strict requirement of discharge under honorable conditions when it 
enacted the current ``under conditions other than dishonorable'' 
standard in 1944. The current standard correctly and fairly 
acknowledges that those who were discharged for relatively minor 
offenses should not be barred from receiving veterans' benefits. 
Congress' intent was also clear when it amended the law in 1977 to 
allow an individual who was discharged under dishonorable conditions, 
or conditions otherwise precluding basic eligibility, to receive VA 
benefits based upon a separate period of service if VA determined that 
the individual was discharged from the other period of service under 
conditions other than dishonorable or would have been discharged under 
conditions other than dishonorable if not for reenlistment.
    Endorsing a change in the character-of-discharge standard where one 
period of service under other than honorable conditions would unfairly 
negate other periods of service that were under conditions other than 
dishonorable and is in direct conflict with the intent of Congress when 
it enacted the current character-of-discharge standards.
Recommendation 5-2 (Chapter 5, Section I.2.B)
    Maintain the present definition of line of duty: that 
servicemembers are on duty 24 hours a day, 7 days a week.

    American Legion Position. The American Legion fully supports this 
position and we are hopeful that the Commission's recommendation 
regarding this issue will end further debate calling for a line of duty 
(LOD) definition that only covers injuries, diseases, or deaths 
incurred while performing military duties.
    The intent of Congress regarding the LOD definition and the equal 
treatment of all veterans--no matter how, when or where a service-
related condition was incurred--is clearly expressed in the legislative 
history and current statutory provisions. Previous recommendations to 
limit the line of duty definition to only those disabilities that are a 
direct result of performance of military duties have not been acted on 
by Congress, despite large potential savings touted by the recommending 
agencies. The American Legion believes that there are very good reasons 
previous recommendations to limit or restrict the current LOD 
definition have not been implemented. First, there is the basic 
question of fairness. Limiting the line of duty definition to only 
those disabilities, deaths and illnesses incurred while actually 
performing one's military duties--despite the fact that an active duty 
servicemember is considered, under the Uniform Code of Military Justice 
(UCMJ), to be on duty 24/7--is inherently unfair and fundamentally 
wrong. Additionally, the message such a change would send to current 
servicemembers and prospective members would undoubtedly have a 
negative impact on both recruitment and retention. Finally, the 
additional administrative costs and other burdens resulting from a 
change in the line of duty definition would offset any projected 
savings.
Recommendation 5-3 (Chapter 4, Section I.2.B)
    Benefits should be awarded at the same level according to the 
severity of the disability, regardless of whether the injury was 
incurred or disease was contracted during combat or training, wartime 
or peacetime.

    American Legion Position. The American Legion fully supports this 
recommendation. An injury, disease or death is just as debilitating and 
traumatic to an individual and his or her family no matter how the 
condition was incurred or where the veteran was at the time it was 
incurred. Making a distinction between combat and non-combat 
disabilities is fundamentally wrong and demeaning to the honorable 
service of all veterans. Moreover, implementing such a provision would 
add another level of complexity to an already overburdened and complex 
adjudication system.
Recommendation 5-4 (Chapter 5, Section I.3.B)
    Maintain the current reasonable doubt standard.

    American Legion Position. The reasonable doubt standard is the 
hallmark of VA's non-adversarial disability compensation program and we 
fully support this recommendation.
Recommendation 5-5 (Chapter 5, Section I.4B)
    Age should not be a factor for rating service connection or 
severity of disability, but may be a factor in setting compensation 
rates.

    American Legion Position. The American Legion does not support the 
use of age for establishing entitlement to service connection or for 
determining severity of disability, nor do we support using age as a 
factor in setting compensation rates. Although we understand the 
reasoning behind the Commission's recommendation calling for age to be 
used as a factor in setting service-connected disability compensation 
rates, The American Legion maintains that compensation rates should be 
based on the severity of disability and should not be applied 
differently based on the age of the veteran.
Recommendation 5-6 (Chapter 5, Section I.5B)
    Maintain the current standard of an unlimited time limit for filing 
an original claim for service connection.

    American Legion Position. The American Legion fully supports this 
recommendation. Although we recognize that it is prudent for veterans 
to file service connection disability claims as soon as possible after 
separating from service, and we strongly encourage such action whenever 
possible, that option, for various reasons, is not always feasible. 
Therefore, if sufficient evidence to establish entitlement to service 
connection is submitted, the benefit sought should be awarded, 
regardless of how long after service the claim was filed.
Recommendation 5-7 (Chapter 5, Section I.5B)
    DOD should require a mandatory benefits briefing to all separating 
military personnel, including Reserve and National Guard components, 
prior to discharge from service.

    American Legion Position. The American Legion fully supports this 
recommendation. It is extremely important that separating members 
receive sufficient information regarding all VA benefits to which they 
may be entitled after separation from service.
Recommendations 5-11, 5-12 & 5-14 (Chapter 5, Section II.1)
            Recommendation 5-11
    The goal of the presumptive disability decision-making process 
should be to ensure compensation for veterans whose diseases are caused 
by military service and this goal must serve as the foundation for the 
work of the Science Review Board. The committee recommends that the 
Science Review Board implement its proposed two-step process. [IOM Rec. 
4]
            Recommendation 5-12
    The Science Review Board should use the proposed four-level 
classification scheme, as follows, in the first step of its evaluation. 
A standard should be adopted for ``causal effect'' such that if there 
is at least as much evidence in favor of the exposure having a causal 
effect on the severity or frequency of a disease as there is evidence 
against, then a service-connected presumption will be considered. [IOM 
Rec. 5]

     Sufficient: The evidence is sufficient to conclude that a 
causal relationship exists.
     Equipoise and Above: The evidence is sufficient to 
conclude that a causal relationship is at least as likely as not, but 
not sufficient to conclude that a causal relationship exits.
     Below Equipoise: The evidence is not sufficient to 
conclude that a causal relationship is at least as likely as not, or is 
not sufficient to make a scientifically informed judgment.
     Against: The evidence suggests the lack of a causal 
relationship.
            Recommendation 5-14
    When the causal evidence is at Equipoise and Above, an estimate 
also should be made of the size of the causal effect among those 
exposed. [IOM Rec. 7]

    American Legion Position. The American Legion does not support 
these recommendations because the ``association'' standard currently 
used in the presumption determination process is consistent with the 
non-adversarial and liberal nature of the VA disability claims process. 
Moreover, as is the case of the 1991 Gulf War, there is often a lack of 
specific or reliable exposure data. Due to improper record keeping, 
resulting in a lack of reliable exposure data, during Operations Desert 
Shield/Storm, there is insufficient information to properly determine 
servicemember exposure to the numerous environmental and other hazards 
U.S. troops were exposed to in the Southwest Asia theater of operations 
during the war. A lack of such data would clearly diminish the value 
and reliability of a ``causation'' standard as recommended by the IOM. 
It should also be noted that despite its recommendation, the Commission 
stated that it was concerned that ``causation rather than association 
may be too stringent'' and encouraged further study of the matter.
Recommendation 7-15 (Chapter 7, Section VIII.2)
    Lump sum payments should not be considered to compensate veterans 
for their disabilities.

    American Legion Position. The Commission thoroughly studied this 
issue and we are hopeful that this recommendation will put an end to 
future proposals in favor of lump sum payments.
                                closing
    Mr. Chairman, that concludes my statement. Thank you again for 
allowing The American Legion to present comments on these important 
matters. As always, The American Legion welcomes the opportunity to 
work closely with you and your colleagues to reach solutions to the 
issues discussed here today that are in the best interest of America's 
veterans and their families.

    Chairman Akaka. Thank you very much, Mr. Smithson.
    Senator Burr. Mr. Chairman, if I could ask the Chair's 
indulgence; I have an 11 o'clock commitment that I would like 
to get out of, but I can't get out of, and I wanted to share 
with the witnesses that I would like to have my questions 
submitted to you in writing and your answers back.
    But I also want to take this opportunity to thank all of 
the organizations that are represented at the table for their 
thoughtful review of the Commission's report.
    Some of us have had individual meetings, so I have a good 
feel as to where the groups are. I can't disagree with anything 
that has been said. But, I want to go back to something I said 
to General Scott.
    What we're attempting to do is hard. It will require 
everybody to give and take if we are to accomplish an overhaul 
of the system. If the intent is not to overhaul the system, 
then there will be winners and losers, and everybody in this 
room and everybody in this country will participate in picking 
who wins and who loses. I do not think that is why they sent us 
here and I do not think that is why you do what you do and you 
represent who you represent.
    My hope and my belief is this Committee will, in a very 
bipartisan and open way, attack and address the recommendations 
in as expeditious a way as we can. And I hope we do that with 
the full knowledge of the realities of what this town will 
throw in its way, keeping us from accomplishing this mission.
    So again, I thank you.
    Chairman Akaka. Thank very much, Senator Burr. Thank you 
for your cooperation in dealing with this as we do in this 
Committee.
    Mr. Bowers.
    Mr. Bowers. Mr. Chairman.
    Chairman Akaka. In your testimony you state that, and I 
quote, ``Along with the recommendations of the Dole-Shalala 
Commission and the work of the GAO and other government 
agencies, Congress has been presented with effective solutions 
to many of the problems facing today's wounded warriors,'' 
unquote.
    I am very interested in that statement. Can you please 
elaborate on which Dole-Shalala Commission and GAO 
recommendations would serve as effective solutions?
    Mr. Bowers. I think, Mr. Chairman, it is a combination of 
all of them. When we initially reviewed the Dole-Shalala 
Commission findings, we agreed with many of their topics and 
found that with the Veterans' Disability Benefits Commission 
there were items that overlapped. That is extremely successful 
because it shows that both Commissions saw eye-to-eye on 
certain issues--things along the line of levels of disability, 
addressing Post Traumatic Stress Disorder and TBI ratings.
    In regards to the GAO, we have reviewed a tremendous amount 
of reports in regards to the backlog due to the complexities of 
the disability rating system. By building off of the GAO and 
what they have done and what they have seen, in regards to VA's 
difficulties in processing a tremendous amount of claims, I 
think that really put things on the radar starting initially 
three years ago with an initial report that they came out with 
addressing this issue.
    We have since seen the amount of disability ratings grow. I 
believe it is upwards somewhere of 200,000. And by looking at 
those numbers and knowing exactly what is at hand--one thing 
that IAVA strongly endorses is trying to find a way to 
establish a two-year cap to try to reduce the backlog by 50 
percent. That has been something that we recommended in our 
legislative agenda last year and something that we will again 
be recommending this year. It is something that we would like 
to see--that backlog cut down--because as these wars continue, 
we are going to see a tremendous amount of veterans coming back 
and the numbers are just going to get greater.
    So, all of these resources, we have really been able to 
sort of pull together.
    Chairman Akaka. Thank you very much.
    Mr. Manar, in your written testimony you support the 
Commission's recommendation that VA temporarily increase 
compensation levels up to 25 percent to take into account the 
effects on quality of life until such time as detailed studies 
can be conducted and adjustments made to reflect the loss of 
quality of life.
    Please share with us your thoughts on how VA could measure 
loss of quality of life. I would appreciate hearing the 
comments of others on the panel as well on this after Mr. 
Manar.
    So, Mr. Manar, really share with us your thoughts on how VA 
could measure loss of quality of life.
    Mr. Manar. Sir, I am a lawyer by training and a 33-year 
veteran of helping veterans obtain compensation. I am not a 
scientist or a doctor. It is my belief that, based on our study 
of recommendations from the Institute of Medicine and the 
Veterans' Disability Benefits Commission, that a panel--a 
committee or several committees--would have to be devised to 
look at the individual disabilities, perhaps system-by-system, 
to determine what impact there is on quality of life.
    Because of the research of the Disability Benefits 
Commission, we see that compensation today just replaces lost 
earnings for most veterans. Except for those few disabilities 
that warrant special monthly compensation, there is no added 
benefit for most disabilities in terms of compensation for loss 
of quality of life.
    It is our view, and I believe it is supported by the 
Institute of Medicine, that it would take studies conducted 
over a number of years to determine what quality of life--
first, how to measure it, and then to figure out what it is; 
what the loss is for each injury or disability; and at 
different levels.
    The Institute of Medicine, if I recall their report 
correctly, indicated that they do not yet have the tools to do 
that. So, they would have to be devised. It would not be a 
simple process. That is why I believe the Commission 
recommended this interim payment for loss of quality of life, 
and that is certainly why we support it.
    Chairman Akaka. Would you recommend an across-the-board 25 
percent increase for all disabling conditions and all levels of 
disability?
    Mr. Manar. Oh, no, no.
    Chairman Akaka. If not, what specific increases do you 
recommend?
    Mr. Manar. I think that it's safe to say that we would 
support the VDBC recommendation, and that is: that the most 
severe disabilities would warrant a 25 percent increase as a 
guesstimate of what it would take to begin to compensate for 
loss of quality of life.
    For someone who is 10 percent disabled or 20 percent, I 
believe that they suggested, and I certainly heard it in 
discussions at the Committee hearings, that it would be 
marginal increases at the lower levels. Basically for every 10 
percent you get another 2.5 percent. So, a 10 percent evaluated 
veteran (a veteran with a 10 percent disability rating), would 
receive an extra 2.5 percent. Somebody with 20 percent would 
receive 5 percent and so on, until you gave up to the 25 
percent.
    Chairman Akaka. Would you venture any answer to how long 
this temporary increase should last?
    Mr. Manar. I would suggest that until the tools are devised 
and the study is completed, or at least well on the way to 
completion--as the Rating Schedule is adjusted, taking into 
account the quality of life impacts--then the benefits can be 
reduced for those individuals who are reevaluated where the 
evaluations assigned take into account the loss of quality of 
life.
    It's not our belief that the changes to the Rating Schedule 
should be held off until everything has been reviewed, 
everything's been revised, everything's been accomplished. It 
is our belief that as a body system is finally reworked to take 
into consideration both current medical terminology, levels of 
disability, appropriate levels of disability and quality of 
life, the VA, as it does today, can implement that by a change 
in regulation.
    That means that the people who have been receiving 100 
percent and a 25 percent quality of life addition--if that is 
now incorporated into their evaluations--they would be 
evaluated appropriately under the Rating Schedule and not 
receive the additional interim benefit.
    Chairman Akaka. I asked for others on the panel to make 
comments on this. Mr. Smithson.
    Mr. Smithson. Obviously, I think everybody who has looked 
at the quality of life issue has determined that it is an 
extremely hard thing to get a grasp on, and I agree with Mr. 
Manar that additional studies will be needed to look at it.
    The Dole-Shalala Commission recommended separate payments 
for quality of life. Also, as part of their recommendations, 
certain conditions would be covered under quality of life and 
certain conditions would not be covered under quality of life. 
I think those are issues we need to look at as well. Would it 
be a separate payment? Does every condition affect the quality 
of life? Some would argue, yes. Some would argue, no. Those are 
things that we would need to look at as well. But I think, 
obviously, a thorough study of that issue is needed.
    Chairman Akaka. Mr. Bowers.
    Mr. Bowers. I would agree also that it is something that 
needs to be looked at in depth. One note that I did make here 
in regards to quality of life is that--something we are finding 
up at Walter Reed and Bethesda--a lot of people are being rated 
on what is referred to as ADL, activities of daily living, 
which is an extremely complex structure, which is very 
difficult for people to understand.
    One of our members lost his left leg and his right foot. He 
was a police officer in Fairfax County, Virginia. He received 
sort of the same benefits as people who may not have been a 
police officer, but it all falls together in a very confusing 
manner. This is something that we are trying to understand. 
Maybe because it is so difficult to grasp, it is something that 
also needs to be reevaluated.
    Chairman Akaka. Thank you.
    Mr. Smithson, in your testimony you support the 
Commission's recommendation that VA follow a holistic approach 
that links treatment and compensation for PTSD while 
encouraging wellness. However, you comment that periodic 
reviews of PTSD disability claims could place undue stress on 
PTSD service-connected veterans. Without periodic reviews, how 
would you suggest that VA accomplish a holistic approach?
    I would appreciate other comments, as well, on that.
    Mr. Smithson. I think that our focus was on mandatory 
periodic reviews and that a lot of veterans would view these 
reviews as an attempt to reduce or take away their benefits, 
such as what we saw about three years ago when the VA announced 
that they were going to look at over 70,000 PTSD claims that 
were rated a 100 percent, and that caused a lot of concern in 
the veteran community.
    So, I think the approach of these reevaluations--the VA 
now, periodically, if the condition is not permanent and total, 
will go back and look at it and possibly reevaluate it.
    I think any reevaluation that is conducted needs to be done 
under the guise that it's not necessarily going to result in an 
automatic decrease in benefit; and VA needs to separate the 
health care side it, the treatment side of it, and the 
compensation side of it. Because, I think if it appears that it 
is solely being done to reduce benefits, it is going to hamper 
treatment and actually have a negative impact.
    So, I think separating the health care side and the 
compensation side when you conduct these reviews or 
reevaluations is important.
    Chairman Akaka. Mr. Bowers, do you have any comments on the 
holistic approach?
    Mr. Bowers. Yes. When we initially looked at this, we sort 
of related it to what we are seeing right now with our National 
Guard and Reserves. Continuous deployments makes things 
extremely difficult to get your foot back in the door and get 
used to life.
    By having a mandatory set time to be reevaluated and 
essentially fighting for your benefits is really going to have 
an impairment on the individual's recovery.
    A way to look at this that we think would be beneficial 
would be: not have a mandatory set time, but a medical examiner 
would state that they would undergo reevaluation based on what 
they're finding with that individual. This will not initially 
be something that will hamper their benefits, but for 
understanding whether the treatment is being beneficial.
    There are many issues that individuals deal with with PTSD 
where they can get better. They can see that their lives are 
getting more productive. But, to constantly have them under the 
microscope on a set timetable is going to make it very 
difficult for them to come back in.
    So, an element of thinking out of the box: we would love to 
see evaluations done just to get a better understanding of the 
effectiveness of treatment, and have that separate from the 
reevaluation of whether their benefits will come under fire.
    Chairman Akaka. Mr. Manar.
    Mr. Manar. The Department of Veterans Affairs has the 
authority now to conduct review examinations whenever they 
choose, more or less. The regulation allows review examinations 
no sooner than two years after a rating decision and no more 
than five years. The VA stopped doing routine review 
examinations starting in the mid-1990s because of workload 
considerations.
    Every new examination they requested, or review examination 
they requested, meant another examination and another rating. 
So because their workload, even back then, was beginning to 
climb, they stopped doing them on a regular basis.
    The only conditions that we are aware of that they 
routinely conduct examinations as they are required to do is 
where the regulations require a follow-up examination: 
following cessation of treatment for cancer, for instance, an 
examination to assess residuals is required.
    So, the VA has got the authority to do review examinations 
anytime they want to get back into that business. We are also 
opposed to creating mandatory periodic on-a-set-schedule 
examinations for veterans who are undergoing psychiatric 
treatment, or, for that matter, any other treatment.
    It should be done based on the medical evidence that the VA 
has and the information that they receive. So, the VA has the 
authority to conduct these examinations. They just need to get 
into a position with their workload where they can do it and 
then, at that point, determine what is appropriate for that 
individual veteran.
    Chairman Akaka. Thank you very much.
    This next question is for all of our witnesses. How was 
your organization involved in the Veterans' Disability Benefits 
Commission? Mr. Bowers.
    Mr. Bowers. Well, being, per se, the ``relatively new kids 
on the block,'' we actually were not established here in 
Washington, DC, until March of this year. So, we came in 
relatively late in the game.
    We were involved with two testimonies with the Commission 
in regards to veterans' benefits review, and we also had the 
opportunity to meet with many of the Commissioners to discuss 
IAVA's point of views based on our 2007 legislative agenda and 
issues that specifically pertained to the Benefits Commission.
    We were very excited, as such a new organization, to be 
involved, which I think really spoke to the thoroughness that 
the Commission exhibited in looking at everything. I wish the 
efforts that we will be showing this year--I wish we had done 
it last year in regards to a poll that we have recently been 
working on with 1,000 Iraq and Afghanistan veterans to 
understand where the need lies for a lot of these issues. I 
wish we could go back in time a year to be able to present 
those findings for the Commission.
    With that said, what they have done has really involved 
Iraq and Afghanistan veterans, as a whole, and their 
correspondence with us really stayed true to their 
effectiveness and how thorough they were with these issues.
    Chairman Akaka. Since you have been involved with them, do 
you foresee your organization being involved in the effort to 
respond to the Veterans' Disability Benefits Commission in the 
future?
    Mr. Bowers. Yes, I do. I think we will continue to have 
involvement with them in looking at the way many of their 
recommendations go forward. It's something that we will be 
watching very closely.
    It is 544 pages of the most thorough work that I have seen 
in regards to, you know, a review of the veterans benefits. And 
it is something that we at IAVA will be holding very dear. We 
would love to be able to be involved with the outlays, 
understanding what is next to come, how many veterans are going 
through the system, how many are being affected, and what are 
we going to see 10, 15, 20 years from now as the Nation's 
youngest generation of veterans come home. How can we plan for 
that and be ready for what we may call a surge?
    Chairman Akaka. Mr. Manar.
    Mr. Manar. It has been my privilege, first as a service 
officer, an appeals manager for the Military Order of the 
Purple Heart, and over the last several years as Deputy 
Director for the Veterans of Foreign Wars, to attend virtually 
every hearing that the Disability Benefits Commission held.
    In addition, in my capacity with the Veterans of Foreign 
Wars, we were able to testify before the Disability Benefits 
Commission--I personally on at least six occasions, and I know 
others in our organization several more times--on many topics. 
And we represented not just ourselves, but, on several 
occasions, other major service organizations as well.
    Our input and our views were welcomed. They were not always 
adopted or accepted by the Commission. That was to be expected. 
All we asked for them to do was to listen to our views, our 
perspective, our experiences, and take those into consideration 
when they made their decisions and their recommendations. And 
they did that.
    I am personally grateful to have had this experience with 
them and it is because of that interaction--watching them day-
in and day-out in public forum first voice their views and then 
sometimes change their views based on the evidence, the 
science, the studies that were conducted. That was the really 
impressive thing: if they came in with preconceived notions, 
they made adjustments as the facts dictated that they do. That 
is the real benefit, I think, that came out of them spending 
all this time and energy--to really immerse themselves into 
this work, unlike some other Commissions.
    Chairman Akaka. Thank you very much for that.
    Mr. Smithson.
    Mr. Smithson. The American Legion attended all of the 
Veterans' Disability Benefits Commission meetings in 
Washington, DC. We also had American Legion participation in, I 
believe, all of the town hall meetings that were conducted in 
association with their site visits.
    We testified on numerous occasions and we also worked 
closely with staff on a regular basis to provide additional 
information and input. Our input was accepted in a positive 
manner, and we feel that, initially--like I mentioned in my 
written statement--that there was skepticism surrounding the 
creation of the Commission as a vehicle to make negative 
changes. But, as the Commission's time span moved on we could 
see--actually from the very beginning General Scott made it 
clear that that was not the case, and they were very open to 
recommendations and input from the veterans community.
    Chairman Akaka. Thank you for that. I expect this to 
continue and I am glad to know your feeling about your 
involvement with the Commission.
    My next question is that on process. The question is for 
all of the witnesses. In your opinion, was the process the 
Commission used to analyze the recommendations of the Institute 
of Medicine and CNA Corporation adequate?
    Mr. Bowers.
    Mr. Bowers. I would start off by saying, yes. One of the 
elements that we were very impressed with was really getting a 
solid understanding of the medical intricacies that go along 
with a lot of these issues. And, by utilizing the Institute of 
Medicine and their reports, I believe the Commission did the 
correct thing by stepping back and saying, we are not the 
complete experts in this field. Let's find who the best people 
are out there and utilize the information that they provide. 
So, in those regards, yes, I think they did do a thorough job 
in utilizing things that were already set forth for them.
    Chairman Akaka. Mr. Manar.
    Mr. Manar. The Commission, in dealing with the Institute of 
Medicine and the Center for Naval Analysis, really had two 
different approaches, because the product produced by those two 
different entities was presented differently.
    The Institute of Medicine operated totally independently. 
Although it would come in on a monthly basis and brief the 
Commission, it was not on the substance of what the IOM 
Committees were focusing on, but more on the process itself. 
How many times did they meet this month; who they took 
testimony from.
    But, once they got into their closed-door deliberations, 
there was virtually no information coming from the Institute of 
Medicine as to the substance of what the IOM was considering. 
So, when they delivered their report, that's what they got. 
There was no chance to submit questions to the IOM to get 
clarification. It was just, here it is; this is what we have 
came up with.
    And to some extent, the product was, in our view, not 
necessarily always as good as it could have been--because we 
saw in contrast the Commission's interaction with the Center 
for Naval Analysis. They also came in every month and briefed 
the Commission on what they were finding.
    Initially it was more about process than anything else. But 
then, VDBC started getting data and they started doing some 
initial analysis of that data. And it was the questions of the 
Commission to the folks from the Center for Naval Analysis that 
caused them to clarify--not change, because the data was what 
was driving their conclusions, but to clarify--how they 
presented their statements and modify how they presented things 
so it was more understandable, and, consequently, more useful 
to the Commission.
    Then, what the Commission did with both reports was to sit 
down and go through the recommendations item-by-item and decide 
what it was that they could do with each: whether they were 
going to accept it, modify it, or reject it outright.
    So, it was a fascinating, quite frankly--sometimes a boring 
process to observe--but it was deliberate, and professional, 
and it was very helpful to all of us, I think.
    Chairman Akaka. Mr. Smithson.
    Mr. Smithson. I think the Commission actively reviewed the 
data they received from both the IOM and CNA, and as General 
Scott noted in his testimony, they didn't agree with all of the 
recommendations. They didn't just rubber-stamp the 
recommendations. And, I think what they did use was well 
thought out and reasoned in the Commission's report.
    Chairman Akaka. Thank you.
    My last question to all of you is, how should Congress 
prioritize the recommendations made by the Commission? If you 
have an idea, we certainly would like to hear it. And let me 
begin with Mr. Bowers.
    Mr. Bowers. Well, rolling dice would not be the best way to 
do that. I would say, probably the most effective measure would 
be communication with the veterans service organizations and 
the outlets to veterans, and what they are dealing with right 
now.
    As we saw the recommendations come out, understanding the 
depth of each one and what the priority of those would be is 
something that we would have to take a tremendous amount of 
time analyzing and that is why, again, I fall back to the poll 
that we recently conducted of Iraq and Afghanistan veterans--
which we will be, I think, officially releasing the second week 
in February--be able to tie in, directly from the horse's 
mouth, what Iraq and Afghanistan veterans are saying is their 
top priority for change. And, I think, by comparing that with 
what the Commission's recommendations are, would be an 
extremely valuable resource that we, IAVA, would be able to 
provide. And then, also working with the other VSOs to 
communicate with the membership and understand what are the top 
tier issues.
    Ultimately, the veterans that are out there are the ones 
that are being affected by this, and it is up to them to be 
able to put these things into prioritization--to understand, 
you know, what the most important issues are.
    Chairman Akaka. Mr. Manar.
    Mr. Manar. I think it is important to understand what the 
Commission did not do with regards to the current compensation 
program and specifically the Rating Schedule: they did not 
decide to end it.
    After two and one-half years of gathering evidence, taking 
testimony, hearing people from all stripes, from people who 
wanted to do away with it, to people who wanted to reform it, 
to people who didn't want any change at all--they decided that 
there were enough good features in the current compensation 
program and there were enough good things in the Disability 
Rating Schedule to work with it--to work to change it, to work 
to make it better, but not just to throw it out and start all 
over again.
    They realized, I think, that if you throw it out, if you 
start from scratch, you wind up creating a brand new set of 
problems. You may fix some things, you may improve benefits, 
you may get it more correct or better or right, if you will, 
for some veterans, but you also take the very real chance of 
harming more veterans than you help by throwing it out.
    There is a history here with the current compensation 
program and the Rating Schedule that cannot be ignored and I 
think the Commission recognized that there are a lot of good 
things that come out of it. There are things that need to be 
fixed; and the reason why we are in this state today is because 
the VA has neglected to do what it was charged to do.
    Now, there are a lot of reasons why that is. You can 
certainly point to understaffing for decades. You can certainly 
point to the creation of the Court in 1988 and all its 
decisions--many of which have required VA to redevelop or re-
adjudicate hundreds of thousands of cases. That alone can put 
you in the hole for years to come.
    And then there is the Veterans' Claims Assistance Act, 
which is a wonderful tool, but it takes time to do all those 
things that are required and to do them correctly.
    So, there are lots of reasons why the VA is in its current 
situation. I think it is incumbent on Congress and all of us to 
understand that we did not get into this situation overnight 
and it cannot be fixed overnight. I think what needs to be done 
is for Congress to exercise its oversight; Congress to direct 
that certain things be done, but within the current system.
    Chairman Akaka. Thank you very much.
    Mr. Smithson.
    Mr. Smithson. I think we need to look at the 
recommendations that would have the greatest effect in fixing 
major problem areas in the disability compensation system and 
then prioritize those recommendations based on those that can 
be done quickly and those that will take more long-term study.
    I think there's a lot of things that can be done quickly--
some with legislation and some without legislation. And I think 
we need to prioritize those recommendations, but again, look at 
all the recommendations and look at those that would provide 
the greatest positive effect on the compensation system itself.
    Chairman Akaka. I want to thank this panel of witnesses for 
your responses to the questions and also for your statement. We 
look forward to working with you, and with other VSOs as well, 
on this and look forward to working with VA on these, and, of 
course, the Commission as well.
    This, I think, is an important step in how we are beginning 
to achieve the changes that are necessary for our veterans. So, 
again, I want to thank you for being a part of this and for 
being as helpful as you have.
    This hearing is adjourned.
    [Whereupon, at 11:32 a.m., the Committee was adjourned.]
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