[House Hearing, 113 Congress]
[From the U.S. Government Publishing Office]



 
              FOCUSING ON PEOPLE: A REVIEW OF VA'S PLANS 
               FOR EMPLOYEE TRAINING, ACCOUNTABILITY, 
               AND WORKLOAD MANAGEMENT TO IMPROVE 
               DISABILITY CLAIMS PROCESSING
=======================================================================

                                HEARING

                               before the

                     COMMITTEE ON VETERANS' AFFAIRS

                     U.S. HOUSE OF REPRESENTATIVES

                    ONE HUNDRED THIRTEENTH CONGRESS

                             FIRST SESSION

                               __________

                       WEDNESDAY, MARCH 20, 2013

                               __________

                           Serial No. 113-12

                               __________

       Printed for the use of the Committee on Veterans' Affairs





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                     COMMITTEE ON VETERANS' AFFAIRS

                     JEFF MILLER, Florida, Chairman

DOUG LAMBORN, Colorado               MICHAEL H. MICHAUD, Maine, Ranking
GUS M. BILIRAKIS, Florida            CORRINE BROWN, Florida
DAVID P. ROE, Tennessee              MARK TAKANO, California
BILL FLORES, Texas                   JULIA BROWNLEY, California
JEFF DENHAM, California              DINA TITUS, Nevada
JON RUNYAN, New Jersey               ANN KIRKPATRICK, Arizona
DAN BENISHEK, Michigan               RAUL RUIZ, California
TIM HUELSKAMP, Kansas                GLORIA NEGRETE MCLEOD, California
MARK E. AMODEI, Nevada               ANN M. KUSTER, New Hampshire
MIKE COFFMAN, Colorado               BETO O'ROURKE, Texas
BRAD R. WENSTRUP, Ohio               TIMOTHY J. WALZ, Minnesota
PAUL COOK, California
JACKIE WALORSKI, Indiana

            Helen W. Tolar, Staff Director and Chief Counsel

Pursuant to clause 2(e)(4) of Rule XI of the Rules of the House, public 
hearing records of the Committee on Veterans' Affairs are also 
published in electronic form. The printed hearing record remains the 
official version. Because electronic submissions are used to prepare 
both printed and electronic versions of the hearing record, the process 
of converting between various electronic formats may introduce 
unintentional errors or omissions. Such occurrences are inherent in the 
current publication process and should diminish as the process is 
further refined.


                            C O N T E N T S

                               __________

                             March 20, 2013

                                                                   Page

Focusing On People: A Review Of VA's Plans For Employee Training, 
  Accountability, And Workload Management To Improve Disability 
  Claims Processing..............................................     1

                           OPENING STATEMENTS

Hon. Jeff Miller, Chairman, Full Committee.......................     1
    Prepared Statement of Chairman Miller........................    41
Hon. Michael Michaud, Ranking Minority Member, Full Committee....     3
    Prepared Statement of Hon. Michaud...........................    42
Hon. Tim Walz, Prepared Statement only...........................    43
Hon. Jackie Walorski, Prepared Statement only....................    44

                               WITNESSES

Hon. Allison Hickey, Under Secretary for Benefits, Veterans 
  Benefits Administration, U.S. Department of Veterans Affairs...     5
    Prepared Statement of Hon. Hickey............................    44
    Accompanied by:

      Ms. Diana Rubens, Under Secretary for Field Operations, 
          Veterans Benefits Administration, U.S. Department of 
          Veterans Affairs

                        STATEMENT FOR THE RECORD

The American Federation of Government Employees..................    56
The American Legion..............................................    60
Iraq and Afghanistan Veterans of America.........................    61
National Organization of Veterans Advocates......................    63
Paralyzed Veterans of America....................................    65

                        QUESTIONS FOR THE RECORD

Questions From: HVAC Majority Members, To: VBA...................    67
Responses From: VBA to HVAC Majority Members.....................    68
Letter and Questions From: HVAC Minority Members, To: VBA........    70
Responses From: VBA to HVAC Minority Members.....................    73


   FOCUSING ON PEOPLE: A REVIEW OF VA'S PLANS FOR EMPLOYEE TRAINING, 
 ACCOUNTABILITY, AND WORKLOAD MANAGEMENT TO IMPROVE DISABILITY CLAIMS 
                               PROCESSING

                       Wednesday, March 20, 2013

                     U.S. House of Representatives,
                            Committee on Veterans' Affairs,
                                                   Washington, D.C.
    The Committee met, pursuant to notice, at 10:00 a.m., in 
Room 334, Cannon House Office Building, Hon. Jeff Miller 
[Chairman of the Committee] presiding.
    Present: Representatives Miller, Bilirakis, Runyan, 
Huelskamp, Coffman, Cook, Walorski, Michaud, Takano, Brownley, 
Titus, Kirkpatrick, Negrete McLeod, O'Rourke, Walz.
    Also Present: Representative McCarthy.

              OPENING STATEMENT OF CHAIRMAN MILLER

    The Chairman. The Committee will come to order.
    Good morning, everybody. Thank you for being here this 
morning to talk about a topic that is not new to this 
Committee, namely needed improvements to the disability claims 
processing system.
    As of this week, VA had nearly 900,000 pending claims, with 
over 70 percent of those claims pending for longer than VA's 
targeted processing time of 125 days.
    Recently, VA has rolled out its transformation plan as a 
means of addressing this growing backlog of claims. Pursuant to 
a quick search of Merriam Webster's Dictionary, 
``transformation'' means the act of changing in composition or 
structure. Similarly, ``plan'' is defined as a detailed 
formulation of a program or action.
    What we have seen from VA so far does not amount to a 
significant change in the culture of the organization, nor has 
VA provided a very detailed formulation of the plans that they 
have for moving forward, although it is my hope that VA is 
truly committed to changing the culture of the department.
    Most of what we have seen so far consists of repackaging 
old initiatives with new PowerPoint presentations and 
impressive buzz words. Speaking of buzz words, VA has 
repeatedly stated that it plans on accomplishing its 
transformation plan by focusing on people, process, and 
technology.
    Our purpose this morning is to focus on the first of these 
three elements, which may be the most important element, and 
that is people. Although much emphasis is placed on the process 
and technology, I do believe that we should focus more on the 
people that are doing the work.
    There are thousands of men and women who, on a daily basis, 
work throughout the Department of Veterans Affairs doing a 
great job and those jobs should not go unacknowledged. 
Nonetheless, the more people VA hires to process claims, it 
appears the worse the department's productivity is.
    [Chart]
    The Chairman. Indeed, as the first chart that we will put 
on the screen this morning shows, in 1997, the average VA field 
employee processed 135 claims per year whereas in 2011, that 
number had dropped to 73 claims per year.
    [Chart]
    The Chairman. Further, as the second chart shows, VA has 
nearly three times as many field employees to do the work now 
than it did 15 years ago.
    Now, one would think that working fewer cases per employee 
would result in higher accuracy rates, but accuracy is 
stagnant, and as the budget has grown exponentially, 
unfortunately, so, too, have the processing delays.
    As I have stated many times before, there are many people 
including myself who are losing patience as we continue to hear 
the same excuses from VA about increased workload and increased 
complexity of claims.
    Let me just give you one example from VA's own budget 
books, and I quote, ``The effect of the military draw-down on 
VA's claims process is marked not only by a large volume of 
claims being received, but also by increasing complexity of 
those claims.''
    ``As a result of the pre-discharge counseling being given 
to service personnel, veterans have been claiming more 
conditions on their initial applications. Instead of the 
traditional two to three disabilities per claim, regional 
offices are dealing with 10 to 15 issues per claim.''
    I could go on, but I just ask, does this sound familiar? It 
should because what I just read to you came out of VA's 
February 1994 budget submission.
    Now, VA has and will encounter complications along the way. 
However, VA's demonstrated history shows its inability, or 
refusal, to forecast problems and anticipate its needs. And the 
only people paying a price for this failure of VA are the 
veterans. The time for excuses is over.
    So, Under Secretary Hickey, we are here today to have an 
honest discussion about the people who make up VBA, from file 
clerks to RO directors to VA central office managers, and on 
how you intend to transform this workforce through better 
accountability and workload management practices.
    I recently had the opportunity to travel to the Baltimore 
Regional Office. I was able to observe new employees' challenge 
training. I also learned more about the Station Enhancement 
Training that the Baltimore RO will soon undergo.
    Although proper training is important, I would like to 
reiterate that that is not enough. VA also needs to remain 
focused on accountability and better workload management 
practices.
    For example, one of the words we hear most when VA is 
called before us is ``Nehmer.'' Nehmer, a class action lawsuit 
that requires VA to prioritize certain Agent Orange 
presumptions, did add significantly to VA's workload.
    However, during the 111th Congress, Secretary Shinseki 
testified before this Committee that VA would easily be able to 
fast-track those claims. I quote, ``By 2013, we will be back to 
where we are today at about 161 days to process a claim.''
    Under Secretary Hickey, as you know, we are not there 
today. On the contrary, we are at 280 days for an initial 
rating decision.
    Without better workload or surge capacity planning, I am 
fear that VA is simply one national mission away from complete 
collapse and utter failure. This is simply unacceptable.
    So, again, we are here today to explore how the people who 
make up VA can prevent this scenario from happening.
    I want to thank Under Secretary Hickey for being here 
today, as well as those who submitted statements for the 
record.
    I now yield to our Ranking Member, Mr. Michaud, for his 
opening statement.

    [The prepared statement of Chairman Miller appears in the 
Appendix]

           OPENING STATEMENT OF HON. MICHAEL MICHAUD

    Mr. Michaud. Thank you very much, Mr. Chairman, for holding 
this hearing today.
    And I would like to take a brief moment to recognize that 
it has been a decade since we started Operation Iraqi Freedom. 
The wars in Iraq and Afghanistan have claimed 6,669 American 
lives with over 50,000 wounded in action and countless others 
suffering mental injuries as a result.
    I want to thank all the veterans' advocates on this 
Committee and in the audience who have worked hard to assist 
these fine men and women who served our great Nation.
    Since March of 2003, there has been much that we should be 
proud of: the Post-9/11 GI Bill that ensured that these 
veterans have the opportunity of an excellent college 
education, record increase in budgets for the VA programs, and 
services that have led to better care and access for our 
Nation's veterans in rural areas.
    But there is still much more to be done. Despite the 
positive outcomes, we have a lot of challenges facing our 
veterans and their families.
    While the VA continues to process more claims than at any 
other time in its history, demand continues to outpace 
production. Today, as you heard, VA's total inventory is 
approaching 900,000 claims with more than two-thirds of the 
claims considered to be part of the backlog.
    However, despite the growing backlog, I am encouraged by 
some of the recent developments and by the shift in attitude of 
some of VA's efforts to solve the backlog problem.
    Nonetheless, while I appreciate the Secretary's goal of 
having no veteran wait for longer than 125 days with an 
accuracy rate of 98 percent by 2015, I question whether this 
very, very aggressive, ambitious goal is achievable.
    It would require the VA to complete approximately 3.4 
million claims in two and a half years. To accomplish this 
goal, the VA must start averaging the completion of 
approximately 1.36 million claims a year. That is a 33 percent 
increase in productivity.
    These are loose numbers and I hope the VA does have better 
ones. But in my mind, the math does not add up and I am not 
sure how we are going to get there by 2015.
    I also question whether the VA is being up front with 
Congress about its challenges. In particular, does VBA have 
enough employees to get the job done? I am not convinced that 
it does. And is VBA getting all of the information that you 
need from the Department of Defense in a timely fashion? I do 
not believe that is the case either.
    VA's ability to process claims in a paperless electronic 
environment can only be as good as the information that goes 
into the system. If you do not have the resources required and 
you are not receiving information from DoD or other agencies, 
we need to know about that.
    Further, I am concerned that VBA is simply trying to 
automate a claims process that at the end of the day does not 
work. I hope to hear from you--ideas as to how the workload 
management will change in the electronic setting.
    Can VA visualize an electronic system in which veterans' 
claims come not in as claims but is broken down in various 
medical conditions?
    You know, for the purpose of discussion, let's suppose that 
13 medical conditions is in a claim. These 13 medical 
conditions are not sent through the segmented lanes of 
veterans' local regional office. They are sent to 13 regional 
offices throughout the country electronically simultaneously 
being adjudicated at the same time.
    As you know, different ROs specialize in different medical 
conditions. And when you look at the different codes out there, 
the numerous amount of codes out there, it is very hard, for an 
employee to know how to move those claims forward rapidly.
    I think challenged ROs should get the easy medical 
conditions while the ROs that do a great job might want to 
handle the more complex conditions. And, more importantly, 
veterans get paid as each medical condition is completed.
    I challenge the VA to think outside the box. It is an old 
adage that a benefit delayed is a benefit denied. Far too many 
veterans are waiting far too many days to receive the benefits 
that they have earned.
    We are all working towards the same end goal, timeliness, 
accuracy of disposing of these claims. If we are here to be 
successful, we must work together to achieve a claims system 
that lives up to the service and the sacrifices of our veterans 
and soldiers as they defended this great Nation of ours.
    So I would encourage you, Madam Under Secretary, as we move 
forward with the VBMS system to think outside the box. It does 
not necessarily have to be the way it has always been in the 
past to approve these particular claims.
    With that, Mr. Chairman, I yield back.

    [The prepared statement of Hon. Michaud appears in the 
Appendix]

    The Chairman. Thank you very much, Mr. Michaud.
    I want to welcome the panel that is with us this morning. 
It is the only panel at the witness table this morning, General 
Allison Hickey, the Under Secretary for Benefits with the U.S. 
Department of Veterans Affairs.
    We certainly appreciate your service. Thank you for being 
here this morning. You are now recognized for five minutes. 
Please proceed.

  STATEMENT OF ALLISON HICKEY, UNDER SECRETARY FOR BENEFITS, 
 VETERANS BENEFITS ADMINISTRATION, U.S. DEPARTMENT OF VETERANS 
 AFFAIRS, ACCOMPANIED BY DIANA RUBENS, DEPUTY UNDER SECRETARY 
 FOR FIELD OPERATIONS, VETERANS BENEFITS ADMINISTRATION, U.S. 
                 DEPARTMENT OF VETERANS AFFAIRS

    General Hickey. Thank you.
    Good morning, Chairman Miller, Ranking Member Michaud, 
Members of the Committee. Thank you for the opportunity to 
discuss VBA's transformation efforts and the employees that are 
critical to its success.
    I am accompanied today by the Deputy Under Secretary for 
Field Operations, Diana Rubens.
    As a direct result of the support provided by this 
Committee, VBA employees are completing more compensation 
claims than ever before in the history of VA, over three 
million in the past three fiscal years and three times the 
amount completed in 2000, while increasing the quality even in 
the last year by nearly four percentage points as well.
    Yet, despite these efforts, too many veterans still have to 
wait too long to get the compensation and benefits they have 
earned and that is unacceptable.
    My testimony today will focus on how execution of our 
transformation plan will allow VBA to eliminate the backlog in 
2015 by leveraging our greatest assets, our employees.
    I would first like to discuss the inventory of claims and 
the factors impacting our employees' timeliness. The current 
inventory represents claims from veterans of all eras. The 
largest percentage of our claims comes from our Vietnam era 
veterans who make up 37 percent of the inventory and the 
backlog.
    1990 Gulf War era veterans make up 23 percent while 
veterans of Iraq and Afghanistan conflicts make up only 20 
percent. Our World War II and Korea era veterans make up less 
than 10 percent.
    Thirty-nine percent of the inventory are original claims, 
those submitted by veterans claiming a disability for the very 
first time from VA. Sixty-one percent are supplemental claims 
from veterans who are seeking additional benefits. In all, 
about half of the veterans in the total inventory and backlog 
are already receiving some level of compensation from VA.
    What is clear, is the demand for this benefit is at an all 
time high. In the past four years, we have added more than 
940,000 veterans to the VA compensation rolls which is more 
than the size of the active duty army and navy combined.
    Coupled with this increase are two factors that have had a 
significant impact on the growth of the inventory and backlog. 
In 2009, Secretary Shinseki made the decision to add three 
presumptive conditions for Vietnam veterans who were exposed to 
Agent Orange. In response, VBA dedicated 37 percent of our 
staff to do these claims, over a quarter million of them, 
providing $4.5 billion in retroactive benefits to 164,000 
Vietnam veterans and their survivors.
    While this decision was absolutely the right thing to do, 
it did have an impact on our ability to keep up with new claims 
coming in the door and on the aging of claims we already had.
    The second factor is the increase in the complexity of the 
claims themselves. There has been a 200 percent increase over 
the last ten years in original claims containing eight or more 
medical issues.
    From 2009 to 2012, the number of medical issues inside the 
claims increased, and we completed 2.7 million to over four 
million last year. This 50 percent growth in medical issues is 
a truer measure of the time it takes to complete a claim and it 
is having a significant impact on our production and the growth 
in inventory.
    Given the growing demand and the complexity of claims, it 
is clear that continuing a legacy approach to meet the needs of 
veterans will not work.
    I am happy to report today that we achieved momentum with 
the transformation plan and that plan will improve how 
veterans' benefits are delivered for generations to come. And 
2013, right now is the year of full deployment and change.
    Our transformation represents the largest single 
reinvention of this organization that we have ever seen and our 
focus is on managing this change while sustaining production 
and improving quality.
    VBA employees are key to that success. Fifty-two percent of 
them are veterans themselves. The productivity of this 
workforce and the accuracy of decisions are now being increased 
through new national training programs and standards.
    New employees attended challenge training, decide 150 
percent more claims per day with a 30 percent increase in 
accuracy.
    Through process improvement design teams, VBA has launched 
initiatives like segmented lanes, disability benefits 
questionnaires, and fully developed claims. And they are 
showing positive results with increased implementation.
    The veterans benefit management system is our Web-based 
electronic claims processing solution. We have deployed the 
first generation of VBMS in January 2013 and have 25 stations 
on it today.
    With the integration of VBMS and the online portal e-
benefits, we have achieved an end-to-end digital filing 
capability. Veterans can now file a claim online using a Turbo 
Tax like model, upload their own evidence, and all within a 
digital environment.
    Mr. Chairman, our transformation plan, we are on track to 
achieve our goals for delivering that improved benefits 
delivery for veterans.
    And this concludes my statement. I would be pleased to 
answer your questions.

    [The prepared statement of Allison Hickey appears in the 
Appendix]

    The Chairman. Thank you very much.
    A couple of questions.
    Because we only have one panel with us today, there will be 
an opportunity for a second round of questioning. So I will 
hold myself to five minutes, if you will put me on a clock.
    The first question, to date, three ROs have been closed for 
SET. I am interested in finding out what sort of training is 
provided to the poorly performing ROs' management team.
    You noted in career trajectory testimony that developing 
employees into positions of greater responsibility helps to 
ensure employees understand the various roles in the claims 
process and that institutional knowledge is preserved and 
enhanced.
    Yet, we have been told that some management currently does 
not even know the basic fundamentals that go into processing a 
claim, but they are in charge of the office.
    So what I would like to hear from you, and the Committee, I 
am sure, would appreciate, is what training are these managers 
and directors receiving when the current option of last resort, 
SET is deployed to that office?
    General Hickey. Thank you, Chairman, for your question. I 
will start and then I will defer to my colleague, Ms. Diana 
Rubens, for any further clarification.
    Our Station Enhancement Training was actually a new effort 
that we started this year. It was, frankly, built upon the 
improvements we saw associated with our individual employee 
challenge training on the courses that we put out there.
    And we saw such good improvements in personnel's ability to 
both rate claims at a higher speed, and at a higher quality 
level as well that we said why don't we take this in an entire 
station model into a regional office where not only do we 
retrain from top to bottom, those people physically touching 
the claim, but we also at the same time stand down for a period 
of time the leadership and review and go through how to do good 
work flow management, how to use all the new tools that are 
available for you to do that.
    We go all the way up the line into the leadership 
environment to retrain, essentially reset, provide new 
information as necessary to get that regional office in good 
stead.
    I will tell you having done it at Oakland, we saw a 27 
percent increase in production and an eight percent increase in 
quality. And LA is on track showing some similar early 
benefits.
    Ms. Rubens. Secretary Hickey, thank you.
    I would tell you I think that you have largely covered it. 
The key, if I understand the Chairman's concerns in particular 
around workload management, the entire team has focused on 
supervisors, managers, leaders of the regional office to ensure 
they understand how we make sure that work is getting 
accomplished efficiently and effectively with the resources on 
station.
    The Chairman. So that is how you train managers and 
directors when an RO has been closed?
    General Hickey. So, Chairman, thanks for the opportunity to 
even add more.
    One of the things that we have done in Oakland that we 
continue to do when we are involved in a set-like training 
where we are trying to help improve and boost both productivity 
and quality in a regional office is we bring in the area 
directors which we have done in Oakland.
    The area director for Oakland actually repositioned himself 
for the entire time that Oakland was going through this effort 
to provide increased oversight, increased coaching, mentoring 
of the leaders in that organization.
    We have done the same thing in Baltimore. The area director 
for the eastern area has also positioned herself in a way in 
which she is providing increased oversight, very deliberate 
oversight for those stations.
    The other thing I will tell you that I have done recently, 
and we started this process January of this year, I have now 
stood up a new VBA stat process where every single regional 
office has responsibility to come and sit at a table with me 
for an entire day digging into their data and to their 
performance challenges and to their successes.
    I have ten regional offices at the same time with me. We go 
deep down dive into their data. Where they have challenges, we 
ask them to please produce an action plan and we assist them 
with doing that.
    They also are sitting at the table with other regional 
offices about their size and complement and their mission kind 
of capabilities where we get to share best practices, you know, 
why does this particular regional office do very well, what are 
you doing in that environment that we could use over here.
    The third thing we have done both in Oakland, LA, and now 
in Baltimore is we have sent in some folks who do this very 
well in the organization. By example, we have taken one of our 
best service center managers and put them in Baltimore to 
really dig in and help coach a service center manager at that 
level as well so they can gain from that person's experience in 
another location.
    And then if there is any other things Ms. Rubens would like 
to add, I will----
    The Chairman. I appreciate it. I have six seconds left and 
I am going to yield to Mr. Michaud.
    But as I prepare to yield, I want you to think very 
carefully. Have any of your regional officers been a failure?
    And I now yield to Mr. Michaud.
    Mr. Michaud. Thank you very much, Mr. Chairman.
    General Hickey, I know one of the issues of concerns that 
was actually brought up by our Senate colleagues is that 
information regarding the transformation initiatives and the 
performance of VA's regional office is not being shared.
    Is there any information that you use to determine the 
effectiveness of the various transformation initiatives that 
you have not shared with this Committee?
    General Hickey. So thank you, Congressman Michaud, for your 
question.
    I also thank you for spending an entire day with me up in 
Togus after your selection for this Ranking Member position so 
that we could walk you through each and every one of them and 
then also show you how a segmented lane looks in practice and 
show you the benefits of fully developed claims, those kinds of 
issues. So I appreciate that.
    Let me just say I do measure, you know, the productivity 
the same way I measure productivity every single day, the same 
way we present to you in our Monday morning workload reports, 
the same way we produce and give not just you, not just 
veterans, but every American in any State that wants to look 
and see how VA is doing through our completely transparent Web 
site called ASPIRE.
    The other thing we do is we present all of that data 
through our performance reporting in the performance.gov 
environment as well.
    There is nothing I have that is not shared, but if you 
believe that you would like me to specifically go and dig 
something out, I will.
    As we gain in the production, you will start seeing the 
numbers that I see on a regular basis have some impact. You 
will start seeing overall production as it does today, frankly. 
Today we have 7,500 more claims this year than we did last year 
at this time. Today we have 10,000 claims less waiting in 
inventory, a small number albeit, but I have also seen a three 
percent increase in our overall production across the board.
    Is that big? No. But I would remind you we are making a 
major reinvention of this organization change right now and our 
employees are changing while they are producing and producing 
at higher quality levels than ever before.
    Mr. Michaud. Thank you.
    Can you provide us with the information that you are 
looking at in regards to your performance metrics? I do not 
expect it today, but if you can provide it for the record.
    General Hickey. I will absolutely do that, Congressman. 
Thank you for the request. I will take that.
    Mr. Michaud. And you had mentioned the ASPIRE program, but 
it is my understanding that has not been updated since January; 
is that correct?
    General Hickey. Congressman Michaud, there is a lag in data 
that somebody has to pull it all together and acquire it and 
then load it into the system. There is about a one month lag 
while we make sure all the numbers are accurate at that point 
in time. But it is about a one month lag.
    Mr. Michaud. Yes.
    General Hickey. We usually are updating it by the 10th of 
the following month which is when we have a majority of the 
data all culled together.
    Mr. Michaud. In your testimony, you talked about the 
employees. The dedication of your employees' mission is 
evidenced by the very low turnover rate, only seven percent 
annually.
    I assume that is a national average; is that correct?
    General Hickey. That is, Congressman.
    Mr. Michaud. If you look at some of the poor performing 
sites, the Los Angeles site, the New York site, which are poor 
compared to the St. Paul site or the Togus site, which are 
pretty good, do you have that broken down as far as the 
turnover rates in these particular areas and, if not, could you 
provide that for the Committee?
    General Hickey. Congressman Michaud, I do not have the 
broken down ones by regional offices, but I can certainly 
provide that to the Committee.
    What I would like to say, though, is this up front. I have 
20,000 employees in VBA that are so dedicated to this mission. 
I mentioned that 52 percent of them are veterans themselves. 
What I did not tell you in the opening statement is about 98 
percent of them are a direct family member of a veteran.
    These people come to work every single day because they are 
committed to this noble mission of taking care of the men and 
women who have served in uniform. So I know they are working 
hard. I have been out to 36 regional offices and everywhere I 
go, they tell me how hard they are working. They show me how 
much they are committed.
    I walk around the regional office. I see the pictures of 
all of the people that they show up every single day to honor 
and do their work for. They have been in mandatory overtime not 
complaining but doing it because it is necessary in order to 
meet this growing demand of ten years at war, of relaxing PTSD, 
of opening nine conditions for Gulf War veterans, of doing the 
Agent Orange, of increasing our outreach and access 
extensively.
    Sixty-three hundred more events we do a year now than we 
did in 2008. And, by the way, in the last year, we went from 
239,000 veterans we touched and talked to, to 609,000 and we 
are doing a good job of that, but with it comes additional 
claims.
    Mr. Michaud. Yes. Thank you very much.
    The Chairman. Thank you, Mr. Michaud.
    Out of the 20,000 employees you have, how many were fired 
last year for not doing their job?
    General Hickey. Chairman Miller, I do not have that number 
explicitly. I mean, I do not even know. I probably could go 
find it and get it for you. And I am happy to do that if you 
would like.
    The Chairman. I wish you would. Thank you very much.
    General Hickey. Okay.
    The Chairman. Ms. Walorski.
    Mrs. Walorski. Thank you, Mr. Chairman.
    And thank you for your testimony this morning, Under 
Secretary, for being here.
    As we have listened to this story unfold, and I am a 
freshman, so I have this story unfold for only the last couple 
of months, but the story is about this brave warrior sitting 
here in this wheelchair. That is the story. That is why we are 
meeting today.
    And, you know, in my little district in Indiana, I have 
52,000 veterans just in my district let alone the extended 
families because it is such a family issue.
    And my question is on this issue of accountability. What if 
you do not reach these goals by 2015? It just seems to be a 
continuing story.
    And, you know, I am shocked at the Chairman reading that 
this was a 1994 story in his opening statement. This has been 
going on and on. And I know we hear the issue that this is 
about Agent Orange and this is about, you know, the Vietnam 
vets and, yet, we have a disengagement coming.
    We have a draw-down coming which is going to be a 
significant influx of new veterans. We are opening this to 
women now in combat in the next couple of years and cannot even 
address women's issues now, let alone the influx of women.
    What happens if you do not meet these goals of 2015? We 
just continue to roll along? And where is the accountability 
line drawn because the story and the face of our issue is right 
there?
    General Hickey. Thank you, Congresswoman Walorski, and 
appreciate your taking this position on this Committee. It is a 
very vital Committee to ensure we care for our veterans across 
the Nation.
    And I am particularly aware of the issues that you are 
dealing with in Indiana. We worked very closely in Indiana with 
your adjutant general who has been an enormous help for helping 
us find service treatment records, find personnel records, all 
of which are some of the most difficult things for us to do to 
do a timely claim.
    And so I want to just acknowledge his contribution and his 
relationship with our Indianapolis regional office leadership 
as well.
    I also know that you have had a very large redeployment 
over the last year and a half of Indiana National Guardsmen who 
have been fighting our Nation's war, forward in the fight, as 
has the entire national guard across the Nation.
    When that happens and we have a sudden surge in the system, 
we do have and there are implications of that. We try to work 
it really hard.
    And I will tell you Indiana's numbers are going in the 
right direction now because we are getting a hold of that. So I 
am excited about that.
    We are positioned with this transformation plan built by 
not just VBA, but I will tell you many of the great ideas come 
from employees out there who have been looking and doing this 
work for a long time saying this does not make any sense, let's 
change it, let's do something better.
    And so many of the initiatives like simplified notification 
letter, like disability benefit questionnaires are in there 
because employees recommended it. Many are in there because our 
veteran service organization who I invited to help build the 
plan, they are inside the planning horizon, many of them 
suggested ideas that are included in here like further growing 
the fully developed claim process where we have today 54,000 of 
those claims we have done in 108 days because we had the help 
of the VSOs who 60 percent of them represent our veterans 
coming in the door.
    At that point of contact when they are filling out that 
claim with that veteran, they can say, okay, you are claiming 
this thing, do you have a piece of medical evidence for that, 
give me your DD-214, I can connect the dots. I can now give VA 
your full and complete capabilities so when it comes in the 
door, I am not doing that long hunt it takes us to find all 
that medical evidence.
    The plan we have has been measured in a pilot format inside 
a live regional office with two requirements right up front. It 
had to have a VSO in it and it had to have one of our labor 
partners in it right up front because I wanted to know any 
implications anybody saw to failure in that.
    And I believe that I have the support of the VSOs on the 
plan.
    Mrs. Walorski. And with all due respect, I am sorry, just 
because of the time, I just wanted to add, just ask another 
question in follow-up here though.
    But the accountability of this by 2015, if this does not 
happen, what is the contingency plan because historically if 
you just look at the data, it has not happened? So what is the 
backup plan if this VBA does not come through like it is 
promised to come through?
    General Hickey. So thank you, Congresswoman, for the 
follow-up question.
    I will tell you historically we have never had a paperless 
IT system before. We have never been in a segmented lane 
process where we have an express lane where if you are veteran 
with one or two medical issues, it is kind of like going to the 
grocery store on Sunday. You just want a carton of eggs, you do 
not want to get behind me who shops once a month and I have two 
cartload fulls.
    So we have a lane now where 32 percent of our claims can go 
through in a much faster process. I have measured that. You can 
take 100 days off those claims. We have seen it since October 
for the regional offices who were in that.
    I will tell you today this month, all our regional offices 
will be in that new segmented lane model nine months ahead of 
schedule. Why? Because I saw an increase of about ten percent 
rater production because we were in those different lane 
models.
    And, by the way, from a people perspective, I can now 
target--this gets to Congressman Michaud's idea--I can now 
target really complex claims to people who have lots of deep 
experience in those claims in that special operations lane we 
have.
    Mrs. Walorski. Thank you.
    Thank you, Mr. Chairman.
    The Chairman. Thank you.
    Ms. Kirkpatrick.
    Mrs. Kirkpatrick. Thank you, Mr. Chairman and Ranking 
Member Michaud.
    General Hickey, I represent a large rural district in 
Arizona with many veterans and they have to travel hundreds of 
miles sometimes and bear the expense of an overnight stay out 
of pocket. And I have a caseworker who is devoted specifically 
to taking care of veterans' needs.
    Since I took office in January, we have taken in 17 cases 
of veterans facing backlog. The majority of the backlog is over 
two years. We have even heard reports of veterans who passed 
away while waiting for their claims to be processed.
    We are hearing from men and women who are stuck in the 
system. They are struggling. We know their names and we know 
their stories.
    Ending the VA backlog is not just about boosting 
statistics. It is about bettering lives. It is about fighting 
for those who have sacrificed for all of us.
    My question is, have you specifically looked at the 
obstacles that rural veterans face in the claims process? Are 
you addressing that and, if so, how?
    General Hickey. So thank you very much, Congresswoman 
Kirkpatrick, and I appreciate your sensitivity to our rural 
veterans.
    Let me tell you in this transformation, it includes a way 
in which you never have to show up to an RO again to get help 
from us and the way it does, frankly--and it exists today. This 
is not PowerPoint. It exists today. In fact, I have had 2,000 
claims without even advertising it exists today.
    And that is, if we have a veteran who is on e-benefits, 
that is our new DoD/VA shared portal, they can today go online, 
like you all do your taxes online with Turbo Tax, today they 
can go online. They can file a claim. It does not make them 
type it in a form even anymore. It is a question/answer kind of 
thing where they get all the information online.
    They can now today upload their own medical evidence. Do 
not even have to ship off the paper to us anymore. Save that 
medical evidence. That medical evidence and that claim--by the 
way, never before have you had the ability to save date of 
claim which translates into money for veterans instantly. We do 
now.
    That goes directly into our new paperless IT system rather 
than that veteran who has to--and I appreciate this. I commute 
long times, but not nearly the distances they have to. But they 
do not have to get in a car to deliver it. They do not have to 
get in a car to go to a public contact center to find out what 
the status of it is.
    It comes right back to e-benefits and tells them on that e-
benefits site what is the status of their claim, what stage is 
it in, what do we need still from them that we do not have in 
the evidence that they have provided.
    Not only have we created that, in existence today we have 
also created the stakeholder enterprise portal because I am 
going nowhere, nowhere in this transformation without the 
support and help of our veteran service organizations. We have 
to have them in this process.
    So we have built a stakeholder enterprise portal that 
mirrors e-benefits, that allows our VSOs to file those claims 
on behalf of people they hold a power of attorney for and then 
they can upload the evidence. And I never get the paper in the 
door. So all of that exists today.
    The other thing I will tell you that will help our rural 
veterans, and I know you were describing, I think, more of a 
situation with their health, where they go for a health 
appointment, is the new telehealth efforts. And that is not my 
area, but I am certainly more than willing to get you more 
information on the growing telehealth efforts that my 
counterparts in the Health Administration are doing as well.
    So we are trying to get online. We have clearly heard from 
our veterans. Seventy-three percent of them tell us that they 
want us to meet them online. So we are doing that and we 
provided a provision for doing that.
    I will tell you my data says they have moved there. In 
fact, I had 10.7 million contacts in 2010 and that was 98 
percent by phone. Today in 2012, I have 31.9 million contacts, 
32 percent by phone, 68 percent by e-benefits. So they are 
coming up online.
    Mrs. Kirkpatrick. Thank you, General.
    My time is almost out, but I want to ask one other 
question. Yesterday I spent time with Iraq and Afghanistan 
veterans who are calling for a commission devoted specifically 
to figuring out how we get rid of this backlog.
    What are your thoughts about such a commission?
    General Hickey. Thank you, Congresswoman.
    I will tell you that I have a lot of oversight and very 
effective oversight today. I have this oversight of this 
Committee which I really appreciate. I have the oversight of 
the Senate Veterans' Affairs Committee and I have many 
Subcommittees that provide us oversight on a daily basis.
    I have the oversight of the inspector general on a real 
regular basis and the oversight of GAO on a real regular basis. 
I believe that we have a lot of great people already looking 
into how we are doing this and providing us great ideas and 
also providing us challenges. And I think that the oversight 
that has been presented is comprehensive and I look forward to 
continuing working with the existing oversight.
    Mrs. Kirkpatrick. Thank you, General.
    And I yield back my time.
    The Chairman. Thank you very much, Ms. Kirkpatrick. And I 
also appreciate you bringing up the IAVA call for a commission 
from the President to look at this backlog. I support their 
efforts on that as well.
    I would like to ask unanimous consent from this Committee 
to allow the majority whip, Mr. McCarthy, to ask questions out 
of order. Are there any objections?
    Without any, Mr. McCarthy, you are recognized for five 
minutes.
    Mr. McCarthy. Well, I want to thank the Chairman and thank 
this Committee for letting me be a part.
    Under Secretary, I have a few questions, if I may. First, 
let me preface with my concerns. I do not sit on this 
Committee, but I am here because I have a great concern. I may 
be the majority whip, but this is not a partisan issue.
    And all the data that I have seen, I am frustrated that it 
took frustration of Congress to have an audit to find out this 
answer. I am frustrated with the direction of where we are 
going, so let's walk through the GAO report.
    And if we could be specific about some of the things that 
we have asked to do here. I know the GAO recommended the VA 
develop a robust plan for all of its new initiatives including 
performance goals to keep individuals accountable from the top 
down.
    Do you first agree with the findings and the 
recommendations?
    General Hickey. So thank you, Congressman McCarthy.
    I will tell you that I had some disagreements with the GAO 
report and I lodged those, but I am happy to answer your 
questions if you would like.
    Mr. McCarthy. Okay. So you disagree with the findings?
    General Hickey. I did disagree with some of the findings in 
the GAO report.
    Mr. McCarthy. Okay. What specific steps on the timeframe of 
the VA going to take to correct the problems that the GAO 
found?
    General Hickey. So, Congressman McCarthy, let me just tell 
you what we have already done in terms of and where we already 
were in terms of some of the things that they might have found. 
And so that was partly my reaction to the GAO report. Things we 
already were doing were actually then further documented in the 
report.
    For example, we do have new performance standards that we 
have negotiated with our labor partners. We will continue to 
upgrade those performance standards as we move forward.
    Mr. McCarthy. So you find it acceptable the number of days 
in the process?
    General Hickey. Congressman, no, I do not. None of us at VA 
find it acceptable that there are too many days and it takes 
too long to get a veteran the answer to their claim. But we are 
well on our way on a path with a good solid plan vetted by many 
people.
    Mr. McCarthy. So this new plan of yours, when will it be 
able to be finished?
    General Hickey. Congressman McCarthy, we had provided that 
plan to the Congress here in January. It is full and complete, 
very detailed, specific milestones and the like. I did not wait 
to execute on that plan. I was already executing on the plan to 
make sure we did not have any daylight between when we--you 
know, all the time that we had to try and fix this problem.
    I will tell you right now today we are working on our very 
oldest claims. As soon as we finished the Agent Orange, Nehmer 
caseload, we took the people who had been doing it, 37 percent 
of my workforce, we took and pointed them back to the claims 
that had been waiting, our very oldest claims, over two-year-
old claims, that are right now today, and you will see it--you 
know, you are probably wondering why my numbers are going up--
is because my regional offices were given direction to go do 
those oldest claims.
    I could have made my numbers look better. I did not choose 
to do that. It was not the right and integritous thing to do by 
our veterans who had been waiting. I could have made that 
number look better by simply saying to our regional offices 
only do new claims and then only those days would have hit that 
average.
    That is not the way we are with our veterans. So we are 
doing old claims, two-year claims right now which is inflating 
that number that you see in that average days to complete.
    The other thing I will tell you is the other thing we did 
was we repointed capability----
    Mr. McCarthy. I know I only have five minutes and I 
understand here, but I want to get to the crux of the problem.
    Is your productivity in the time you have been there, has 
it risen or lowered?
    General Hickey. So, Congressman, our productivity has gone 
to the ability to rate a million claims, a million claims, 
record level, historical level for VBA in all of its history, a 
million claims----
    Mr. McCarthy. So let me just go to the core. If I go to 
completed claims per field employee, has it increased or 
decreased in the timeframe of your leadership?
    General Hickey. Congressman, we have done 74 percent more 
claims increased over 2000----
    Mr. McCarthy. Do we have the graph here? Maybe you can 
clarify. The data that I have in 1997, we were doing 136 claims 
per field employee. Today that number is 73.
    Is that data wrong or do you disagree with that data?
    General Hickey. I disagree with that data, Congressman, and 
I will tell you why.
    Mr. McCarthy. Okay.
    General Hickey. In 1997, I was potentially doing more 
claims per FTE, but I was also at 59 percent quality, not 
something anyone on this Committee wants me to ever go back to 
again, not something our VSOs want me to ever go back to again. 
And last year, even doing a million claims, we actually 
increased our quality by almost four percentage points.
    Mr. McCarthy. Then why in the LA regional office, why did 
you have to do a station enhancement training where you shut 
down the entire facility to retrain the staff this January?
    General Hickey. Congressman McCarthy, one of the things 
that we learned in setting up what is now called challenge 
training for us, which is part of this transformation plan, we 
did not have very good national level curriculum tested kinds 
of training that we were executing prior to my arriving here. 
We do now. And so we are providing that benefit to stations.
    Mr. McCarthy. So is the station enhancement training, was 
that not taken up because the claim process was so bad in 
filling it out? I mean, why would you shut down the entire 
office for an entire day if the process was not going 
correctly?
    General Hickey. Congressman, we wanted to make sure we gave 
every advantage of every training and skill growth opportunity 
to every employee in LA because I know they want to be very, 
very good at helping the veterans that they serve, the families 
and survivors as well.
    And we did not want to just say keep doing what you are 
doing. Maybe they had learned something wrong and we wanted to 
correct that if there was an opportunity to do so.
    Mr. McCarthy. So what is it? What was the decision that 
made you shut it down for the entire day? Where did you see the 
problem? Was the claims not being done correctly?
    General Hickey. Where we started station enhancement 
training was in Oakland to begin with. And Oakland, after going 
through its station enhancement training, saw a production 
increase of 27 percent and a quality increase of eight percent. 
That is why I said let's go to the next station that is most 
challenged.
    And why we went to LA to do the same thing, we learned 
there was goodness in doing that kind of training and 
retraining the force, many of which who have not had the 
benefit of the new challenge training.
    Mr. McCarthy. One thing I have always learned. It is always 
good to have data. The data that shows under this work, your 
productivity is down, the performance is not there, and that 
goes to the core of leadership. If you are to correct this 
overall problem, it is going to take the leadership to make it 
happen.
    The turnover rate is too high. The process takes too long. 
The correction to the problem, I think you are avoiding many of 
the answers to make it all happen. I think that takes from the 
leadership down to make sure this gets corrected.
    And I will tell you from the instance of where I am at, 
this is a core issue and this is not a partisan issue. And this 
is not something that this Committee will wait to have happen. 
If I had seen these numbers before, it should never take 
another investigation from Congress to find these problems and 
we will not sit back to have them corrected.
    I yield back.
    The Chairman. Thank you, Mr. McCarthy.
    Mr. Takano.
    Mr. Takano. Ms. Hickey, recent press articles have 
highlighted that veterans returning from Iraq and Afghanistan 
who live in metropolitan areas such as Los Angeles, New York, 
and Chicago wait twice as long as their counterparts for their 
claims to be processed.
    What is being done in these urban areas to properly staff 
as well as recruit and retain quality employees?
    General Hickey. Thank you, Congressman Takano, for the 
question.
    And I know I said it in my initial statement, but I would 
like to sort of reiterate it here. Of the backlog and the 
inventory, 20 percent of that backlog and inventory are Iraq 
and Afghanistan veterans.
    The things we have done for those veterans are: you do not 
need a claim done even by VBA to get immediate access to health 
care. Any veteran, Iraq and Afghanistan, who have medical 
issues they need to deal with can immediately go to the medical 
center and get five years worth of medical care to move 
forward.
    And you do not have to wait on me anymore actually. After 
the latest update to the 9/11-GI Bill automation, now we are 
doing claims, the bulk of the work of our claims in less than 
six days to keep our kids in school. You do not even have to 
wait there anymore. You do not have to wait for a VA home loan.
    What I will tell you in California many years ago, and I 
could not even tell you which Administration it was under, 
there was a decision to build a resourcing model for VBA 
regional offices that essentially said if you did good last 
year, you get more FTE this year.
    That does not make any sense to me. We have been 
restructuring that resource model. I believe it should be based 
on demand. It should be based on veteran demand.
    So in the case of Oakland and LA, I have actually increased 
in this last year FTE in both sites. So that is one of the 
things we are working through right now to sort of restructure 
and redistribute our resources that this Committee and others 
so generously provide us.
    Mr. Takano. My colleague from California mentioned the high 
turnover rate. I understand there is a high turnover rate among 
veteran service representatives with one reason being that 
the--well, he did not mention this, but is a possible reason 
that the position is capped at GS10 level?
    In terms of career growth and incentives, has there been 
any effort to delineate the different tiers of VSRs to 
accommodate those with more expertise and to better incentivize 
VSRs to stay in their current positions?
    General Hickey. So, Congressman Takano, great question and 
something we have been talking about inside of VBA. And I noted 
that our AFGE leadership would like us to look at that. I 
talked to the AFGE leadership and I am interested in having 
that conversation to see if there are better ways for us to 
describe how those people do the work.
    What I can tell you is I do not think many people 
understand how complex that work really is. You are not just 
rubber stamping a rating and saying, yes, I see it, checkmark, 
there it goes. There are serious adjudication wisdom, judgment 
that goes into those processes.
    It is not easy to go find medical evidence. It is not easy 
to find the service records for the nature and character of 
your service either. And that is what our VSRs do every day. 
That is hard work and it is complicated work.
    One of the things I will tell you is the new VBMS system 
capability. In the past, you had to remember that as a VSR, in 
your head, all those different things you had to check. You had 
to remember it in your head. Now in the new VBMS capability, we 
are giving you tools so you do not have to remember it. It 
tells you. It prompts you. It makes you look for those things 
that you know you need to do.
    One of the areas we get challenged with in terms of our 
quality is the inferred medical conditions like, you know, you 
have diabetes, but that could mean we also need to look at all 
these other 13 things. We would miss those inferred things. 
Why? Because somebody had to remember that in their head.
    Today in VBMS, you do not remember it in your head anymore. 
The minute you put that medical code in there, it immediately 
populates the inferred conditions and helping a VSR to know I 
need to ask for those exams, those medical exams and get that 
medical information.
    Mr. Takano. You mentioned the increased caseload. I had not 
understood. Can you remind me just what the Agent Orange 
claims, what is the significance of that addition to the claims 
load of VA?
    General Hickey. Absolutely, Congressman. And I will tell 
you if you could see a chart that I have that I am happy to 
share with this Committee, the spike that happened when we 
overnight put 260,000 Agent Orange claims into our inventory, 
had a significant impact. It took 37 percent, all of our surge 
capability out of the workforce leaving 63 percent of our 
employees to do the entire rest of the bucket.
    That was a significant impact and we did them in a really 
good--I know there was testimony last week in the panel that 
followed me in the Senate Veterans' Affair Committee where the 
person, the legal representative stated we did them very, very 
well. We wanted to make sure we did them timely and very well.
    Previous times we did not. They got handed back to us and 
we were told to do them again. We did not want to do that.
    The impact has been 260,000 claims worth in backlog or half 
the backlog. It had a significant impact. But absolutely, 
please absolutely know the right thing to do by our Vietnam 
veterans who have waited more than 50 years for an answer for a 
conditioned that they suffered in war.
    Mr. Takano. Thank you.
    General Hickey. Thank you.
    Mr. Takano. Thank you, Mr. Chairman.
    The Chairman. And, again, nobody on this Committee is 
questioning opening those presumptions up one bit. But, first I 
think it is important to note that VA knew that it was getting 
those numbers into the system. VA did not prepare for the 
surge, did nothing, and that is the concern of this Committee. 
There is no surge capacity to handle another presumption signed 
off by the secretary for another illness within the system.
    But, I think it is also important to note you keep focusing 
on the record million claims that you have been able to produce 
in a year. How about the record 900,000 claims that are in the 
system today? It goes both ways.
    Mr. Runyan.
    Mr. Runyan. Thank you, Mr. Chairman.
    And, Secretary Hickey, I look forward to the number because 
I know Secretary Shinseki always talks about accountability and 
the number that the Chairman requested about how many people 
have actually been held accountable with their job. There is a 
fine threshold between being able to train somebody and someone 
not being able to do their job which kind of leads to my next 
question.
    We always talk about training. Is it internal all this 
training we do? Are you bringing people from the private sector 
that do insurance claims and the like? Who sets the criteria 
for all this training?
    General Hickey. Thank you, Congressman Runyan, for your 
question.
    And let me address the first one which is, we have, like 
every other agency, Federal agency and even industry, when I 
was industry for three years, we used the same identical 
process called a performance improvement plan for employees who 
are having a difficult time meeting their quality or 
performance standards.
    That performance improvement plan is designed to be very 
collaborative in writing, working with the employee to help 
them succeed. That is the desire is to take a really good 
employee, find out where they need additional help, and then 
help them succeed in coming off that PIP and being a valuable, 
contributing member of our organization.
    So I will tell you we do PIPs all the time. People graduate 
from those PIPs. Some people do not. And when they do not, we 
do a couple of things.
    One, we look back in their personnel record and say were 
you fully successful at a lower level doing a different job and 
can we offer you that opportunity to keep your passion for 
veterans or families and survivors in the organization. And 
likely you would not have made it up if you had not been there 
in the first place. We will offer oftentimes that opportunity.
    The second thing that we do look at is, we do look at 
terminations and people leave us. And sometimes that is just a 
fit issue. That exists in any company, in any organization 
around the world.
    So I do say we do have a process and that is an 
accountability process that we work closely with our employees.
    Mr. Runyan. From the get-go when you are hiring somebody, 
though, is there a baseline threshold to even get their foot in 
the door?
    General Hickey. So absolutely we have requirements for 
hiring. In fact, we have increased some of those requirements 
of late with an exposure to the work because we will sometimes 
find people think it is a different experience to come in and 
do a rating claim.
    They think that they are going to interact a lot with that 
veteran when they are really not having that daily interaction 
with the veteran. They are really working hard on getting those 
claims done. And so once they get into the system, they kind of 
go, this is not what I expected.
    So we have done a big push across the country. So when you 
are looking at a job in VBA in one of these rating 
environments, that you get to come hang out and see what it is 
like and talk to people who do it and get a very good feel for 
this work to make sure it is a really good fit.
    Mr. Runyan. But is there a competency exam or anything that 
they would have to go through?
    General Hickey. There is not at this point in time, I 
believe a competency, again. But, I will refer to Ms. Rubens to 
talk about any further of that.
    Ms. Rubens. Good morning, Chairman Runyan. Yes, there is 
process that we are beginning to put in place. We have been 
working hard with our HR folks to say what kind of assessment 
fits within the overall OPM requirements and allowable 
opportunities to us to insure that we get not only those folks 
that are so committed to the Veterans, but have some other 
baseline abilities that they bring to us. We are building that 
now.
    Mr. Runyan. Ms. Rubens, I think we all get that. I mean, 
everybody in this room is committed to Veterans, but, 
ultimately, as leaders of the organization, you have to put the 
best people in place to execute the plan. And I think that is 
really where we are dropping the ball here.
    Talking about this and, obviously, what we are in as 
government, we are in the business of customer service, that is 
really what it is. And Secretary Hickey, you brought up the 
phrase, interacting with Veterans, is there any metrics in 
dealing with the customer service aspect of it? How do you 
measure that?
    I hear the frustration each and every day of someone being 
passed on to 9,000 different hold messages and being told to 
call back. That frustration and the accountability of that and 
how do you actually apply that?
    General Hickey. So, thank you, Congressman Runyan, for your 
question. And there are, in fact, we use JD Powers to assess 
our customer satisfaction with the services that we provide.
    Up until recently we did that primarily in our call 
centers--call center environments. I will tell you that our JD 
Powers score was 745, 763 is the national index for really good 
customer service on a call center. So, we are not far off from 
the national index for that in our call centers.
    That doesn't mean it is not frustrating. I totally 
understand that. It doesn't mean it is not frustrating when you 
are one of the ones that are not getting through in a prompt 
time.
    I will tell you, we have under this transformation plan 
built two additional capabilities to relieve some of that 
frustration and our Veterans are taking us up on that kind of 
capability in record numbers. One is virtual hold, which means 
you, literally, just elect the option, you hang up the phone, 
you go get breakfast, you do your piece of work, you feed the 
dog, you do whatever, run a load of laundry or get ready to 
work or go back to your work on your computer and we call you 
back. I know it works. Ninety three percent of the time we 
reconnect with you. The only reason why it isn't 100 percent of 
the time is because you leave whatever phone you were waiting 
at.
    The other feature we now have that our Veterans are 
increasingly electing is scheduled call back. And this is an 
industry best practice and that is you elect a time in the next 
week where we will call you at that time. I know it works, I 
have done it to test the system, multiple times. It always 
calls me, frankly, I'm always surprised, I forgot I scheduled 
the appointment. But luckily I always put it on my cell phone, 
so it finds me anywhere.
    Both of those two things have helped relieve the pressure 
on the calls. The other thing that has, frankly, helped relieve 
the pressure on the calls is, the move from calling to e-
benefits. We have 63 percent of our contacts now happening on 
e-benefits. So, they are moving from a phone call into an 
electronic environment.
    Because, the biggest reason they call us and you know this 
and I expect it is to check on a status of their claim, which 
they can now see on e-benefits.
    Mr. Runyan. Thank you. I yield back, Chairman.
    The Chairman. Ms. Titus.
    Ms. Titus. Thank you, Mr. Chairman. And thank you for 
coming to testify today. It is nice to see you again. I don't 
mean to sound like I am piling on, but I have to talk about 
what is going on in Nevada.
    The regional office that serves my district of Las Vegas is 
located in Reno, which in itself makes no sense to me since 
most of the people in the Veterans are in Las Vegas as opposed 
to Reno, but maybe all the computerization will help make that 
better.
    Also, the average time it takes to complete a claim out of 
the Reno office is almost 500 days and as one of the Members of 
this Committee, I think that's about the worst. I just want to 
get you, maybe, after this hearing or something, to give me 
some information of what is happening there to address that 
timeframe.
    And then two questions. One, are there benchmarks for the 
regional offices or are you just going to wait until 2015 to 
see if they are meeting your goals, because by then it might be 
too late and benchmarks might be helpful.
    And second, while this Committee is here to provide 
oversight, we also want to help you to do better to help our 
Veterans. Do you have any suggestions of things that we can do 
to make this process of getting rid of the backlog easier or 
quicker?
    General Hickey. Thank you, Congresswoman Titus. And I have 
been out to the regional office in Reno and I think I am headed 
back out there to talk to the Nation's county service officers 
here this summer, so I will look forward to seeing it again.
    Let me first start by answering your Reno versus Las Vegas 
question, which is, we may have the office sitting in Reno, but 
we have intake sites in Las Vegas where Veterans in the Las 
Vegas area can get us that information. But, frankly, under 
this transformation plan that is real today, that is not power 
point and made up stuff, they can go online through e-benefits, 
file their claim, upload their evidence and get it all the way 
into VBMS and they can come back and check on the status of it 
right on e-benefits and never travel anywhere.
    The second thing that I will also say is, as we have looked 
at the Reno problem, part of what happened in Reno, straight 
up, up front--and it has more of an impact in a really small 
office like Reno is, is when you have an employee or two that 
moves in a case they have had, one for family reasons to a 
different State where they actually joined us in a different 
regional office in a different State and another for health 
reasons and when you have, you know, people who retire and that 
all piles on at the same time, that creates a problem in terms 
of being able to continue production.
    I will tell you, Reno has moved forward in terms of its 
staffing, it has got those positions being filled already. I 
will also say, though, you know, a new person versus somebody 
that has been there 20 years, there is a different level of 
coming up to speed that occurs in that process.
    What I have done--what we have done, we have married Reno 
with the Boise office. The Boise office has some capacity to 
assist Reno, so they are taking on those cases.
    The other thing I will let you know is, it doesn't mean 
every case is happening in 500 days. What Reno has been doing 
for the last four months or so, is doing very old claims in the 
system that I have committed them to do. So, that we can help 
those Veterans who have been waiting as we did those Agent 
Orange claims. So, I will allow or ask Ms. Rubens if she has 
anything else to add to that discussion.
    Ms. Rubens. Thank you, ma'am. I would add in addition to 
some of those things that the under secretary mentioned, Reno 
is also coming up in our next stat review. We will be able to 
work very closely with them to dig down into what other things 
we can do to support them as we look for opportunities to 
insure that the Nevada Veterans are being served properly.
    Ms. Titus. So, do you have benchmarks in for the regional 
offices?
    General Hickey. We absolutely do, Congresswoman. For not 
just that, but 93 other different metrics that they have to 
hit, because a regional office doesn't even just have a 
compensation responsibility, it also has a vocational 
rehabilitation employment responsibility. It has a loan 
guarantee responsibility. It may very well have an education 
regional processing office or all those----
    Ms. Titus. Okay. Let me ask you something else real quick. 
I know you mentioned in the Senate hearing about some deal you 
have made with the Department of Defense to get information 
more quickly, because right now it takes--let us see, 25 
percent takes more than 60 days to get the evidence and 13 
percent takes more than 90 days. Can you elaborate on that 
deal? Are there some checkpoints to make sure it is working? Or 
what if they don't comply?
    General Hickey. Congresswoman Titus, I appreciate your 
question and the opportunity to talk about this, because I 
consider this a really good news, and not just the DoD 
agreements, but I was also like to just share, IRS and Social 
Security have made game changing agreements with us and are 
already proceeding forward to make it happen.
    By example, many of the claims that we have to do require 
information, Social Security or IRS has that we had in the 
past, only got it on an annual basis and never with a three 
year back look, which is what we are required to do for a 
decision in those cases.
    What I have now agreement and I totally appreciate the 
leadership at both of those two agencies, I am going to get 
that weekly now. That fundamentally changes that piece of the 
evidence hunt.
    With DoD I appreciate, very strongly, my new partner over 
in DoD who has been working some of these very difficult 
issues. One of which is, the evidence that we use to decide a 
claim, largely is owned by DoD. In most cases it is.
    VHA's medical records that we use to typically do 
supplemental claims, those are the second time and on cases, I 
can get to those really easy. I have access into that system, 
they're electronic, I electronically pull them, I don't even 
make paper anymore out of them and I can just ingest them.
    DoD has now given me an agreement, signed the memorandum of 
understanding or stepping out forward. They've stood up cells 
in the Army and the Air Force. The Navy is doing it a slightly 
different way, but they are doing it. Where they are going out 
and not only gathering all the medical records, but they are 
now going out and getting what they've never had in the medical 
record in the past, which is the Tri-care records, which is the 
contract medical records.
    They are pulling it all together. They are certifying to me 
that they have the medical evidence in that record. And they 
are signing their name on it and they are giving it to me so 
that I don't have to go back and keep doing what I have, which 
is you asked about legislation, which I have in legislation 
since the Veterans Claim Assistant Act of 2000. I have to 
exhaustively look for something that we don't own and never 
owned in the beginning.
    Ms. Titus. Thank you. Thank you, Mr. Chairman.
    The Chairman. If I can follow on with Ms. Titus's questions 
regarding your testimony last week before the Senate Veterans 
Affairs Committee. You had had, in fact, talked about the 
issues of getting records from DoD. I think, basically you 
said, three out of five times when you have an old file, the 
record issue is the problem. You further stated in your 
testimony that you were bound by law to wait 60 days after 
initially asking DoD before an RO can make that request again. 
Is that true?
    General Hickey. Thank you, Chairman Miller, for your 
question. I will tell you that I have learned a little bit 
more. You know, I have been here 16 months, so everyday I learn 
a little bit more. The law is in the VCAA, but it doesn't, 
specifically, prescribe the dates we have.
    I will tell you what it does do. There are two words in the 
VCAA law, one says, for everything I get that is private, 
medical, all the rest of that, I have to reasonably go get it 
in a reasonable period of time. In the same law it also says, 
for Federal records I have to exhaustively look for all of that 
evidence.
    In the period following the VCAA effort, the legal--the 
experts got together and said----
    The Chairman. I am sorry--I am sorry. My question was, is 
it correct that you have to wait 60 days by law or not?
    General Hickey. It is correct that I have to do something 
exhaustively searching, which is defined in law by 60 days.
    The Chairman. Is it correct that you have to wait 60 days 
or not?
    General Hickey. It is not in law that says 60 days.
    The Chairman. It is not part of the--but you said that it 
was. Let me remind you that it is in your own M-21, Part 1, 
Chapter 1, Section C. You can make that change, yourself. So, 
it never was law, but you made it appear that legislatively it 
was an impediment to you being able to do your job. In fact, 
you can make that change yourself.
    I would like to recognize now, Mr. Huelskamp.
    Mr. Huelskamp. Thank you, Mr. Chairman. Madam Under 
Secretary, you have mentioned accountability and data and 
penalties. One thing I want to ask, follow up my colleagues 
questions about the regional offices and your benchmarks.
    What penalties do you have for those regional offices that 
do not meet those requirements?
    General Hickey. Thank you, Congressman Huelskamp, for your 
question. And the penalty is, there are no bonuses for those 
leaders. The penalty is, there is less bonus structure for big 
wide, you know, RO level capability. The penalty is, frankly, 
and bigger than that, the penalty is, those great employees get 
up every single day wanting to be the very best regional office 
in the country serving their Veterans, their family members and 
their survivors and they don't feel good when they know they 
have given it away.
    Mr. Huelskamp. And the bonuses--you are referencing all the 
employees or just the senior managers.
    General Hickey. Largely the senior managers, but even in 
the ranks below--G12 and below, there is a structure----
    Mr. Huelskamp. And I appreciate that. Let me follow up a 
question on that, would you provide for the Committee the 
listing of those bonuses for those regional managers that you 
provide in the last five years. Can you do that for us?
    General Hickey. I can provide '11 and earlier. I cannot 
provide yet '12, because the Secretary has not finalized his 
decision on those bonuses.
    Mr. Huelskamp. For fiscal year?
    General Hickey. '12.
    Mr. Huelskamp. '12.
    General Hickey. They are still working on it. The Secretary 
has not finalized his decision on those.
    The Chairman. If gentleman would yield for just a minute.
    Mr. Huelskamp. Yes, sir.
    The Chairman. I believe that out of 57 VBA SES employees 
that were evaluated in 2011, 30 received a performance award. I 
don't know who. Out of those 30, the awards ranged from $7,372 
to $23,091.
    Mr. Huelskamp. Pretty substantial. If you would follow up 
then, provide additional information on the regions that those 
folks served in, so we can match those to possibly past 
benchmarks.
    But, one other question that I think is fundamental here is 
the issue of data. We heard from the GAO last week that in 
certain parts of your agency that there is data falsification 
occurring. And can you tell me how many employees in your 
division that have been penalized or punished for falsifying 
data in the last three to four years?
    General Hickey. So, Congressman Huelskamp, I don't--I am 
not aware of a data integrity problem in my regional office. 
So, if you have something specific you would like me to 
address, I am happy to, for the record.
    Mr. Huelskamp. Well, you might look at the GAO report, we 
discussed that and according to VA Table of Penalties, Number 
26 deals with falsification of data and it is still waiting for 
a response from the VA, because this whole approach and the 
benchmarks and all your discussion here, is centered on 
accurate data. And if we have employees that are actually 
falsifying data, whether it is in your division or others as 
well, ma'am, you would agree that our whole discussion here is 
for naught if we have inaccurate data; is that correct?
    General Hickey. So, Congressman Huelskamp, I will take your 
concern back, for the record. I believe someone----
    Mr. Huelskamp. No. I asked you a question. Do you think 
that this discussion here is data driven and if there is 
falsification of data as the GAO has outlined that lends little 
credence to the arguments here about benchmarks and progress.
    General Hickey. So, I care starts with integrity and I 
believe that everything that we do comes from a point of 
integrity first.
    Mr. Huelskamp. Okay. So, will you provide and look at--find 
out if there have been any penalties or folks have been finding 
falsified data?
    General Hickey. I will take that for the record, 
Congressman.
    Mr. Huelskamp. Okay.
    General Hickey. I don't have the data.
    Mr. Huelskamp. Okay. I appreciate that. One other thing 
about data and I apologize, Mr. Chairman, I am trying to get 
information here, I will re-ask my question. And maybe you can 
provide that, because apparently budget experts hire levels of 
the VA have yet to find out answers, I think, to about 20 
different questions about VA conferences, lavish expenditures 
and travels that have been an issue for months that apparently 
the VA cannot find the data for that. Apparently, they can find 
data here, they can't find data for numerous other things we 
ask, so have you been asked by your superiors to provide budget 
information or is that someone else's responsibilities to 
decide how you spend money on conferences and those types of 
expenditures?
    General Hickey. So, Congressman Huelskamp, I will tell you 
inside of VA and VBA we are scrutinizing every single 
conference, we are doing down to the paperclip. I have 
mentioned before our challenge training, it is an eight week 
long course. It is an intensive course where we bring our folks 
to. It is probably my major investment in terms of training in 
that level.
    Mr. Huelskamp. Where does that training take place, ma'am?
    General Hickey. It takes place largely in the Baltimore 
Academy, but when I exceed the Baltimore Academy's capability 
for classes, I will centralize a class close to where we have a 
large population of people who are attending. I will also tell 
you I have tested one time and so we are looking closely at it, 
whether I can reduce the cost of that challenge training by 
seeing if I can do more of a blended learning option.
    Mr. Huelskamp. I am out of time. I appreciate that. I was 
just trying to get some data from your superiors and it is very 
difficult to provide an oversight, to actually be able to trust 
the VA when they refuse to answer questions on basic budget 
data and I look forward to a response from your superiors.
    One last question, if I might, Mr. Chairman. You mentioned 
old claims of two years. What's the oldest claim you have 
sitting in the system and can you provide that information or 
the range of claims older than two years?
    General Hickey. I can. I can tell you 4.1 percent of my 
backlog is older than two years. I can tell you that my oldest 
claim is in a regional office that is ten years old. I can tell 
you the reason it is ten years old is because a new claim was 
filed in September of last year and when our raters were going 
through it, noticed that ten years ago that veteran filed for a 
condition that had one of those inferred things that we could 
have found and we did not see it then. And they did not appeal 
it or anything else, but we saw it and so the integritous thing 
to do was for us to say, we have to, got to give that guy ten 
years back capability for that claim they filed but didn't even 
know--didn't even recognize we didn't even do ten years ago.
    We own that time, even though it came in September of last 
year. We say we are responsible ten years ago for the mistake 
we made.
    Mr. Huelskamp. Thank you, Madam Under Secretary. I 
appreciate that. I yield back my time.
    General Hickey. Thank you.
    The Chairman. Mr. Walz.
    Mr. Walz. Well, thank you, Mr. Chairman. And General 
Hickey, good to see you again and thank you for being here. I 
am sorry I left for part of the time. We were actually over 
voting in the AG Committee on regulating credit default swaps 
and derivatives, so I'm actually optimistic here on this side 
compared to there.
    But, first and foremost, I am appreciative of your service. 
I am appreciative of the Chairman and the Ranking Member for 
not giving an inch on this issue. For understanding that those 
folks that are sitting out there, this is the issue, it is 
critical, it is about our moral responsibility. It is about our 
national readiness and you of all people know that, General 
Hickey, so I thank you.
    I am not going to defend what we haven't been able to get 
done. I do want to submit a letter from the VFW to the record 
that I received today. This is one quote from that that I would 
say. ``The VFW believes Ms. Hickey's an integral part of the 
solution to finally breaking the backlog that this and previous 
administrations in Congress has helped create by under funding 
the critical areas of automation and staffing.''
    When I hear about accountability, every one of us who is 
here, whether we got here in this last election or before that, 
are part of this. So, I am at the point now, there aren't a lot 
of questions asked that haven't been asked. There is not a lot 
of things.
    It is going to become what that outcome looks like and how 
we get there. And so, I trust these folks that are sitting 
there. I trust the VFW, I trust IAVA and the folks who are 
here. They are pressing us and they are on your side to get 
this done. Now we have got to be on their side and break it and 
get this done, get the results.
    If this is a case of asking for this, there better be the 
courage here, whether it is taking it from somewhere else or 
doing it, if it is a funding issue, put the dang money in and 
get it done. If it is a personnel issue, put the personnel in 
there and get it done.
    But, sometime within the coming months, this thing has got 
to be broken. We have got to be--and I am optimistic, I say 
that not in jest now, I am optimistic we can get there. I am 
willing to put myself on the line and tell them, because these 
folks are saying, I have been here a lot of times. I have sat 
in this room for ten years, you are putting yourself and 
saying--if you want accountability and the people who said, you 
know, we need accountability, it is going to start with this 
side of the table, too, of holding it to that.
    So, I have a couple questions though, trying to bring some 
of the things that I know on this. We keep talking about you 
are going to train these folks up. I am an educator. Who writes 
the curriculum for training?
    General Hickey. So, thank you, Congressman Walz, for your 
question. I will tell you the curriculum developed now in the 
new challenge training is written by experts who know how to do 
this. It is written and informed by a compensation service who 
watch and tracks the errors that are committed by our 
employees. It is written and informed by our star accuracy team 
who evaluate our claims in a statistically valid way, are the 
ones that give us that overall claim quality. But now also are 
measuring our individual medical issue quality, which by the 
way, as of right now is at 95 percent across the Nation.
    Mr. Walz. Who teaches the class?
    General Hickey. They are taught by our subject matter 
experts from across the Nation in previous days. I will tell 
you, I just hired 40 new dedicated people who will be trainers 
for this project.
    Mr. Walz. As an educator subject matter is critically 
important, but I would argue the art of--are they trained in 
differentiated delivery of education? Because are you going to 
give the same class to the four year processor, the seven year 
processor, the nine year processor, the high achieving, the low 
achieving. How are you differentiating how you are delivering 
this training?
    General Hickey. So, great question, Congressman, and 
probably we have some room to grow in that area. We are doing 
it by an adult learning methodology. We are doing it with a 
lives claim building, while you are doing it. Which, by the 
way, the live claim is actually helping production while you're 
in training.
    We probably need to look at and I will take that as an idea 
and I appreciate your idea on that. We probably need to look at 
better differentiation training. We do do that between 
positions. We probably need to look at how do we target 
individual ones.
    I will tell you, I would be better position now in BBMS, 
better position now as a result of now measuring our medical 
issue level quality to with precision, down to that individual 
employee. Not even how many years they have had it. To be able 
to say this error is the one you always keep doing, let us help 
you fix that.
    Mr. Walz. What if they don't? Going back to Chairman 
Miller's question.
    General Hickey. If they don't, we do what we do with every 
employee--what industry does with every employee, which is, we 
have a performance improvement plan process.
    Mr. Walz. The big question here is, you sit in front of us, 
you will sit here again, General Hickey. If we come back in six 
months--or let us give it a year. If we come back in a year, is 
there significant change to the positive?
    General Hickey. There is significant change already, 
Congressman. I have 25 stations on VBMS today, that means the 
minute you go live on that system every single claim coming in 
the door and we take in 100,000 month nationally. So, that 
means half of those, 50,000 claims coming in right now are not 
turning into paper, making us inefficient and ineffective 
adding to 5,000 tons of paper our employees touch every single 
year.
    Mr. Walz. Do you blame those folks behind you from being a 
little skeptical?
    General Hickey. I don't blame anybody, but I will tell you 
why I am convinced today we can do it. I am convinced because I 
have just seen us do it in the longer term solution for our 
education claims, where we are now doing 95 percent of our work 
in less than six days. That tells me if you can take, with some 
automation, in the system, you can take and break that work 
down better, if you can change the processes to do that better, 
then you can achieve a fundamental growth.
    February, last year, I had 200,000 education claims in 
inventory and you all were talking to me about that and you 
needed to be. Today I have 43,000 claims in the inventory for 
education claims for the spring semester. Twenty five percent 
of what we had last year. That is the same thing we are trying 
to parten--not trying, we are committed to parten to get the 
rules based automation into VBMS. It doesn't take an employee 
out of the process, it simplifies that work for that employee.
    Mr. Walz. I yield back. Let's do it.
    General Hickey. Thank you, Congressman.
    The Chairman. Thank you very much. I was handed a note just 
a second ago. You may actually have a claim out there and I 
don't know if this is real or not, but a claim that may be 11 
years old in the Jackson office on a remand.
    General Hickey. Congressman Miller, I'll have to go take 
and look it up. I am happy to do that if you give me the name 
and the contact information.
    The Chairman. It came into us on our Web site. Let me ask 
real quick, following up on Mr. Walz' question, have you been 
told by employees that any management is taking actions like 
ordering the processing of certain claims first in order to 
make the numbers look better than they really are? Or, 
accidentally clearing old claims for station credit before they 
are completed and then reestablishing the claims under a 930 
end product, which is not tracked by the central office?
    General Hickey. I am going to have to ask my colleague who 
probably knows far more about those level details than I do at 
this point in time, Ms. Rubens.
    Ms. Rubens. Thank you, ma'am. Chairman, I think I heard the 
first part of that was being directed by supervisors or 
managers to take action like that and I would tell you that I 
believe the answer to that is no. We don't have any----
    The Chairman. I didn't say that management is taking 
actions like that, but is management doing that?
    Ms. Rubens. I don't believe that we would have any managers 
that would do that. General Hickey had a bit of a conversation 
about integrity. It is critically important to us. I would tell 
you that the 930 end product that you referred to is an end 
product that if there is a mistake that has been made in 
processing a claim and the end product or the decision is made 
and yet there is something else that we need to do to take care 
of that Veteran, they will utilize that as a means of doing 
that without, if you will, inflating the credit that we've 
taken and yet allow us to continue to track and insure that 
Veterans are being fully answered on any number of medical 
issues they provide us.
    The Chairman. I will do a follow up to you for the record 
on that, because I would like to know a little bit more. Mr. 
Coffman.
    Mr. Coffman. Thank you, Mr. Chairman. Secretary Hickey, 
first of all, thank you for your service to the United States 
Army and your career.
    As a first Gulf War Veteran and as an Iraq War Veteran, I 
can't express my concern enough for this extraordinary backlog 
in VA claims and it is simply not fair to those who have served 
this country and made tremendous sacrifices in defense of our 
freedom.
    At one location, the ONI Oversight Investigations 
substantiated through the Veterans Administration's own 
documentation that for many days in a row over a period of 
weeks, dozens of claim raters had no claims to rate. How is it 
that with the backlog such as it is, raters have no claims to 
rate?
    General Hickey. So, thank you, Congressman Coffman, for 
both your service, as well as your question. You know, when you 
go do some good things you learn some lessons and one of the 
things we learned is, we started moving claims in that express 
lane a whole lot faster than we thought we could.
    So, we have taken some action to--and, frankly, cleared it 
out too fast. That is a positive from a transformation 
perspective because that's 30 percent of our claims right 
there. But, what we have learned is, we need to do something to 
adjust the number of people who are making those claims ready 
to rate in that lane, so that there is a constant feed. And we 
have done that. In fact, we have directed out in the regional 
office while we look at better ways to even do this, that we 
get some assistance in people helping to build cases ready to 
rate.
    Frankly, fully developed claims will help that. Our 
partners in the VSO's who I am just so very pleased, they are 
taking a very strong leadership in this realm. The more they 
bring in fully developed claims, the less of a burden it is on 
that VSR to move it forward and then I can move more forward in 
that regard. And I have promised the VSOs if they bring me 
fully developed claim, we will put it down that express lane. 
That will solve for some of those problems as well.
    The other things--so, as we are learning, we learned that 
we are rating claims faster. There are some tools now in VBMS 
that used to be an initiative called, Simplified Notification 
Letter that help our raters rate many more claims than they 
ever did before.
    So, as we gain advantages in a part of the process, we are 
looking at what the second and third order effects are through 
our government structure, through our subject matter experts 
and we are making adjustments as we speak, because no plan on 
its face, ever goes in a way in which you don't learn something 
as you go along.
    Mr. Coffman. And according to the Veterans Administration 
in fiscal year 2012, 185,169 rating related claims were 
returned to open status for various reasons. In a particular 
regional office, the Oversight Investigations Subcommittee 
investigated and on a given day there were more than 150 claims 
labeled as ready for decision, but they weren't ready to be 
rated because they hadn't been properly developed. The claims 
were then denied or sent back to open status. Is this a 
training problem? Deficiency?
    General Hickey. So, I will say one brief thing and then I 
will ask Secretary Rubens to address the details of your 
question. And the one brief thing that I will say is, Veterans, 
like me, I did it to us in 2007, send in a claim and they 
worked my claim for many, many months and they got ready to be 
done with my claim and I suddenly realized I could have filed 
for that and I sent something new in. That will take it back 
out of that ready for decision process, back into the awaiting 
development effort and back into gathering evidence because 
they now have to get the evidence on that specific medical 
condition I just claimed. So, sometimes it is that issue, but I 
will defer to Secretary Rubens for her comment.
    Ms. Rubens. Thank you, ma'am. I would say you have got it 
just about exactly right. What we will endeavor to do if we 
have to return something to an open status is, if there are 
issues that we can make payment on, we'll work to do that. On 
occasion it will also happen if there is a question about a 
piece of evidence that a rating specialist who has got much 
more technical knowledge is looking for additional information 
or clarification on and so that exchange, if you will, is what 
allows us to understand what is going and we continue to work 
to ensure that if there are training issues, we identify those 
an address those.
    Mr. Coffman. Under Secretary, give me a specific number as 
to what you would expect the backlog to be a year from now in 
terms of what you see as the success of your leadership?
    General Hickey. Congressman, I can tell you that in 2015, I 
will have no claim in our hands in 125 days and we will do them 
at a 98 percent accuracy level.
    Mr. Coffman. One year--one year from now?
    General Hickey. I don't have that number with me, but I'm 
happy to provide that to you.
    Mr. Coffman. Thank you, Mr. Chairman. I yield back.
    The Chairman. Ms. Brownley.
    Ms. Brownley. Thank you, Mr. Chair and thank you, General, 
for being here. I wanted to sort of follow up on understanding 
that we are sort of in the middle of this transformation 
process and it is clearly a challenge, I think, to determine 
staffing levels that are currently adequate and certainly 
staffing levels that will be sufficient in the future. The 
Chair talked about planning ahead and surge capacity, et 
cetera.
    In our Health Committee last week we examined the issues 
around physician staffing and staff planning and trying to come 
up with a data driven method of determining what those staffing 
levels need to be. Is there something similar going on, on the 
benefits side?
    General Hickey. So, thank you, Congressman Brownley, for 
your question. I will tell you, the--we have been looking at 
the staffing issue. I think I described earlier in the hearing 
here, but we had a resource allocation model that, frankly, 
from my perspective doesn't make any sense.
    I think that our resource allocation model ought to be 
built on the demand of Veterans. It ought to be Veterans 
centric from that perspective. This resource allocation model, 
years ago was established, and so we are in the process of 
redoing that now. We are looking at what is the right mix of 
VCRs to raters, in this new environment? That is important to 
note, too, because the nature of the work will change in a new 
transformed VBA. What is the right mix of VSRs to raters? Is 
there a new structure? Is there a new career ladder that needs 
to be built into there to allow us to move forward?
    And I still do believe--so, we do have a--the answer to 
your question is yes, we are looking at that right now. I don't 
have a clear defined answer for you right now because we are 
thrashing through it as we speak.
    Ms. Brownley. Thank you. And I wanted to follow up on 
another issue. We have talked a lot about the productivity 
metric and certainly that is a quantitative measurement that 
can be easily measured and can be interpreted differently.
    But, you have mentioned several times in response to some 
questions about quality metrics and I am not sure what those 
quality metrics are. I am interested to know what they are and 
how you are measuring them and how they also fit into your 
goals.
    General Hickey. So, I appreciate the opportunity to share a 
little bit about that, because we have made some changes in the 
last year, though I will not change the numbers out there. I 
will keep it all exposed, all the existing numbers, but I want 
to further inform the dialogue.
    Today--today--well, actually, yesterday, an employee in VBA 
was rated, no matter how many medical issues were inside that 
claim, they were rated on a up or down complete zero or 100 
percent, did I get everything right in the claim?
    And with an increasing number of claims that are in that 16 
range--16 distinct, unique medical issues inside that claim, if 
they did 15 right they didn't get credit for the 15 in their 
quality, you know, they got no credit for that, which was a 
disincentive, frankly, to picking up a claim that had a lot of 
medical issues in it.
    So, what I have done is--I agree with our folks in the 
field and I heard a lot from our bargaining unit employees on 
this issue and I heard a lot from our staff on this issue. It 
is not a really good reflection, frankly, from a Veteran's 
perspective, it is not a really good reflection of our quality.
    They want to know, how do I do on these? How do I do on 
backs, how do I do on PTSD and TBI and eyes and ears and all 
the--the 800 diagnostic codes we do. So now, I have instructed 
the staff and they have done it. We have rebuilt the systems to 
allow us to measure medical issue level quality all the way 
down to the employee. I could do it at the regional office 
level since October of last year.
    I will tell you, looking at medical issues that way, from a 
quality perspective, I have 11 regional offices today that are 
already at 98 percent quality. I have half the regional offices 
at 95 percent quality. I have all but two regional offices 
above 90 percent quality. I have two below that, we are working 
hard on them. There are some of our opportunities for our set 
training, to improve that capability. But that's a 
fundamentally, I think, more accurate way of looking at how we 
are doing it and, frankly, informs our training better.
    Instead of training to all, as we do today, I can train now 
moving forward to that individual employee or that regional 
offices area of challenge under a medical issue. So, that is 
where we are focused and where we're driving. But I will always 
leave the claim level quality up there so that everybody knows, 
you know, that is where--how we define it from a claim 
perspective.
    I just want to inform the medical issue discussion.
    Ms. Brownley. Thank you, very much.
    The Chairman. Mr. Bilirakis.
    Mr. Bilirakis. Thank you, Mr. Chairman, I appreciate it 
very much. Thank you for your service, General, and your 
continued service.
    In my district office I have several case workers that work 
specifically on veterans' benefits. I hear often from Veterans 
who are frustrated by the generated letters they receive from 
the VA on their claims, listing out of date timeframes. They 
receive letters stating that a claim should be complete in 180 
days when oftentimes it is taking a year and a half.
    They want to be able to plan accordingly while they are 
waiting for their claims to be processed. In other words, they 
would like to have some certainty, particularly during these 
troubled economic times. Since it is the 10th anniversary of 
the Iraq war, and a new generation of Veterans are entering the 
system, what is being done to ensure that the timeframes are 
accurate? And if the timeframe is not accurate, are Veterans 
being contacted with an updated estimation as to when the claim 
will be processed?
    I know it is very, very important. We have to give them 
hope, but I don't want to give them false hope, either.
    General Hickey. So, thank you, Congressman Bilirakis, for 
your question. We are doing some things and I do know we could 
do better. We could do better.
    So, we are trying in a couple of areas. First of which, if 
you have and e-benefits account, you are actually getting the 
regional office number updated on a regular basis. It feeds 
right from the data system that tell you how many days you 
expect your claim to take in that regional office.
    It will be inflated right now as I am having folks doing 
the to old claims right now. Those are hitting the average, but 
it will at least give them some level of that.
    Second, I know the letters. We create a lot of letters and, 
frankly, there's a whole group of people who have asked us to 
quite sending letters and start sending something to their 
email box or put it on their e-benefits account. So, they will 
know, you know, what--they will have a letter, they will have 
it electronically, they won't have it in paper.
    VBMS is doing something to help us on the letters, because 
we create so many of them. We are doing things to try to 
improve those letter, to improve the readability of those 
letters, to simplify our language in those letters, to quit 
talking lawyerees and talk instead human beinease and getting a 
clear, concise language in those letters moving forward.
    Mr. Bilirakis. Thank you. Second question, Mr. Chairman. In 
the St. Petersburg Regional Office, claims development is the 
largest delay with 67 percent of all claims awaiting evidence. 
What is VA's strategy to address such a deficiency in evidence? 
If you can answer that first, please.
    General Hickey. I absolutely can and thanks for asking the 
question, Congressman. Largely, the evidence that VA needs in 
order to decide a claim is not owned or generated or held by 
VBA, you know, over its lifetime. And it is largely--we need a 
couple of things. We need medical records that includes the 
ones while you were in your service to this country and this 
Nation. And we need the character and nature of your service or 
your personnel records. Those are the two big chunks you need.
    We also need--and we'll go get it, private medical records. 
We actually like to ask our Veterans and it provided a means to 
do that with something called, a disability benefit 
questionnaire, where they can literally hand it to their 
private doc and ask them to fill it out and get it back, which 
gives us exactly the medical evidence we need.
    We are seeing an increase in DBQs utilization, thank you. 
I'm sorry. But we need to do more, especially with private 
docs, using those DBQs. That will help us with the evidence 
gathering.
    But the most important game changer on this was three 
actions that I've had as of January of this year. Social 
Security and IRS are now giving us not access to their data 
once a year, access to their data on a weekly basis. That will 
help us immensely.
    DoD has now a new process they have agreed to with me. We 
have a signed memorandum of understanding where they are now 
stood up cells in the Air Force and the Army. Navy is doing it 
slightly different, but the same concept. They are gathering 
all of the DoD medical records. Now, to include tricare records 
and contract medical records, things we have a hard time 
getting a hold of. They are gathering all that up before a 
servicemember departs service, either separating or retiring. 
They are certifying it is 100 percent complete as of date and 
they are handing it to me. That has a major game changing 
effort on that awaiting development, awaiting evidence bucket. 
We then will be able to, in a much faster way, rate that case, 
get that decision done and move forward.
    And, by the way, rate that case and do all those other 
actions, electronically, coming in the door to VBMS, because 
that will be a new claim. We will scan it, we will ingest it, 
it will go directly into VBMS and move along and be done 
without paper.
    Mr. Bilirakis. I have one last question, Mr. Chairman, if I 
may? Thank you. By itself, this Saint Petersburg Regional 
Office has stated that it would need almost two and a half 
million dollars in overtime funds in order to meet the fiscal 
year 2013 production goal. How will the VA address this need?
    General Hickey. I will let my colleague, Secretary Ruben 
answer the question relative to overtime management.
    Ms. Rubens. Thank you, ma'am. Congressman Bilirakis, we 
every year have a set amount of money that we will look at to 
distribute as overtime dollars. The Under Secretary mentioned 
earlier the opportunity to utilize mandatory overtime to ensure 
that we are getting the best output from across the entire 
workforce. It is a difficult decision to make and as we do 
that, it is about the volume of people that we have and the 
amount of work. Looking to maximize the output, we will 
continue to work with the St. Petersburg Regional Office, 
obviously, to insure that they are getting the best outcome for 
the resources we have to make available to them.
    Mr. Bilirakis. Yeah, I would like to follow up with you on 
that----
    Ms. Rubens. Absolutely.
    Mr. Bilirakis. --specifically, the St. Pete Regional. Thank 
you, very much.
    Ms. Rubens. Happy to do so.
    Mr. Bilirakis. I yield back, Mr. Chairman.
    The Chairman. Mr. O'Rourke.
    Mr. O'Rourke. Thank you, Mr. Chairman. General Hickey, I'd 
also like to thank you for your service and wanted to bring to 
your attention a case that we handled in my office recently. We 
had a phone call from the wife of a terminally ill veteran who 
had a service related disability. She wanted our help in 
expediting the claim that goes through the Waco Office and we 
were able to help expedite it, but by the time that they got 
the information back on the claim, unfortunately, her husband 
had passed away. And at that point, the claim had been 
outstanding for 450 days.
    When we dove in a little bit deeper, we found that the 
average out of Waco is 439 days and 80 percent of all 
outstanding claims are over 125 days. And so it is important 
for me to hear and more importantly the Veterans in El Paso and 
the region around El Paso, to hear how you plan to address 
this.
    And I appreciate the ambition of getting to all claims 
under 125 days by 2015, but it really seems that there is a 
crisis in that Waco Regional Office and talking to the other 
Members of Congress whose communities are served out of that 
office, I sense that urgency from them as well.
    So, we would love to have your comments on that and how we 
plan to address that.
    General Hickey. Thank you, Congressman O'Rourke and I will 
tell you just straight up front, we actually are activating 
some plans in Waco and I will let Secretary Ruben address that, 
but I want to talk to you first about--and I think this is an 
important venue to do this, because I could use your help in 
this regard. We do prioritize terminally ill, Medal of Honor, 
former prisoner of war and homeless cases.
    So, please, if you ever--if you ever have anyone that falls 
into any of those categories that is having a difficult time, 
we do prioritize them. Sometimes people don't tell us the word 
terminally ill and so we don't know that, but as soon as we 
do--I have literally moved cases in a day. We have stopped all 
kinds of work and gathered a whole team around to move that 
claim in a day to try to beat the terminally ill veteran's 
passing.
    We do have ways to help that widow with a claim that is 
open afterwards and I'll defer that and the status of the Waco 
Office to Secretary Rubens.
    Mr. O'Rourke. Thank you.
    Ms. Rubens. Thank you. Thank you for the question. Waco was 
one of our last Nehmer Regional Offices to come off the 
rejudication effort.
    What we did when we completed those rejudication claims is 
that brokering center, that surge capacity, turn them first to 
their local regional offices and so the Waco Regional Office 
has benefitted from that.
    The other thing that I think has made a tremendous 
difference for the Waco Regional Office is the arrival of a new 
director there. And, in fact, since last year, the inventory is 
down almost ten percent. The rating accuracy has begun to climb 
and as we see in the three month rolling average, that they are 
now just about at 95 percent.
    And so, while we are focusing on our oldest claims, causing 
that average days to complete number to rise, we are seeing an 
increase in the quality and a decrease in the inventory. We 
will continue to work with Waco to insure that the Texas 
Veterans' needs are met.
    Mr. O'Rourke. I appreciate that and I have spoken to, as I 
mentioned earlier, some of the other Members of Congress whose 
districts are served out of that office, Congressman Flores and 
others, and talked about periodic visits to the Waco Office to 
meet with the regional director and find out what we can do out 
of our district offices and General Hickey, you mentioned that 
it is helpful to you and we can notify you of those cases that 
need to be expedited, for example, with terminally ill 
veterans.
    I heard you, in answer to a previous question, talk about 
the need for VSO's to prepare claims that are ready to go. What 
else can I do out of our office in El Paso to help these 
Veterans who are waiting, obviously, far too long to get a 
response back?
    General Hickey. So, Congressman O'Rourke, the Texas 
Commission is doing a lot to help us. The Texas Commission for 
Veterans. They have come together to help us create those fully 
developed claims, to pull those in, to give us, you know, some 
assistance in getting all the evidence gathered from a veteran 
who is filing.
    And I appreciate that as much as I appreciate all our VSOs 
really leaning inside the wire or the fence and really doing 
yeoman's work to help us significantly.
    So, the things that are critical to our doing a claim, 
bottom line, are the evidence that we need to make the 
decision. Private physicians in the State of Texas and their 
increasing willingness to complete a disability benefit 
questionnaire, which has been created to capture, explicitly, 
the medical evidence we need in order to make a decision.
    A private physician rolling in and helping their patients 
who are veterans would be a major lift in the State of Texas 
and something I'm asking for across the Nation is a private 
physician engagement in this area.
    Mr. O'Rourke. Great. Thank you. We look forward to working 
with you on that.
    General Hickey. Thank you very much, Congressman.
    Mr. O'Rourke. I appreciate your answers. Thank you, Mr. 
Chairman.
    The Chairman. Under Secretary, in your written testimony, 
you included information on individual employee incentives. 
While you said that at the heart of the performance award 
program is a foundation focused on quality, you went on to say 
that the criteria for performance are determined locally and 
vary by office.
    AFGE wrote in its statement that in practice, management 
incentives are almost always based upon production alone and 
production is always highlighted since there are several 
different production categories for a station to qualify for an 
award.
    So, my question is this, how is high level quality mandated 
for incentive rewards if there are no national criteria?
    General Hickey. Thank you, Chairman Miller. I will tell you 
that I value--I highly, highly value my relationship with my 
labor partners. They help inform us of good ideas. In fact, 
many of our labor and our employees, bargaining unit employees, 
have created some of these really good ideas that are already 
showing merit for us.
    I will say----
    Mr. Chairman. I apologize, but my question----
    General Hickey. --to answer your question, specifically----
    Mr. Chairman. --ma'am, my question, very simple. How is 
high level quality mandated for incentive rewards if there is 
no national criteria?
    General Hickey. There is, Congressman, national criteria. 
There is a national quality standard every single year. There 
are also at the Regional Office level, while there might be 
variance, it is not below a basic standard. They may have 
increased in that particular locality and may have locally 
negotiated an ability to hold people to a higher standard. But 
there is no negotiation of a standard lower than the basic 
national standard.
    The Chairman. So, I am to believe that AFGE would negotiate 
a higher standard for their employees than what VA would 
request?
    General Hickey. There are local level negotiations that do 
exactly that, Congressman. And I will defer to Secretary 
Rubens, who has more experience on that.
    The Chairman. No, that is enough on that question. I 
appreciate it. In December of 2012, which was just a few months 
ago, claims processors' and raters' performance standards were 
changed; is that true?
    General Hickey. That is correct, Chairman.
    The Chairman. Were the employees notified of that change?
    General Hickey. I will ask Secretary Rubens to talk about 
the strategy for that.
    The Chairman. Just yes or no. Were they notified?
    Ms. Rubens. Chairman Miller, yes, they were notified.
    The Chairman. Okay. I have been told they were not. And so 
my question is, if they were not, how can unannounced 
productivity changes impact productivity? I mean, I would hope 
that you would, but I've been told that they weren't.
    General Hickey. So, I would tell you that the AFGE were 
integral partners in the teams that developed the new 
performance standards that were released in December. As we 
released those, stations were asked to inform all employees. We 
are, as we continue down the path of implementation----
    The Chairman. Can you tell me, how do you inform all 
employees? How does that work?
    General Hickey. I provide the notification to the regional 
offices and require and ask that they have group meetings with 
their entire service center. That the teams have meetings and 
that as individual employees get the new standards, they are 
effectively provided with a form on the top that they will 
sign, along with their supervisor, to insure that they have 
been discussed recognizing that there was a change. We want to 
make sure that everybody is aware.
    The Chairman. Good. So, it is documented that those changes 
were noticed to each employee?
    General Hickey. Yes, sir.
    The Chairman. Okay. Thank you. Mr. Michaud.
    Mr. Michaud. Thank you very much, Mr. Chairman and to 
follow up on something the Chairman mentioned about looking 
further ahead at the surge. Are you able to take care of it? I 
remember Paul Sullivan telling us that when he was over at VA 
he tried to get the Secretary to put more emphasis on VBA 
because of the surge they were seeing from Iraq and 
Afghanistan, and that wasn't done.
    And I know, Mr. Chairman, Mr. Walz and I have been talking 
about some long term planning within the VA. We will talk to 
you afterwards about how we might be able to look out five, 
ten, twenty years.
    My question, General Hickey, and I will try to phrase it in 
a way so that you can answer it yes or no and my last one to 
allow you to elaborate. In part of my opening statement, I 
talked about claims as well as medical conditions, which are 
different, and how you can quantify that.
    Is it my understanding that you are willing to look at 
medical conditions versus claims and move that through the 
system since it will all be electronic?
    General Hickey. Congressman, not only willing to look at 
it, I think it is a great idea and it is part of our 2015 focus 
is, what we call Centers of Excellence.
    Mr. Michaud. Okay. My second question: we saw a chart 
earlier when you look at the productivity of an employee, when 
you look at claims, you can have one claim that counts as one, 
but within a claim, you can have 13, 14, 10, 11 different 
medical conditions. So it's more complex. Can you provide the 
Committee, if you have the information available, as far as the 
productivity of an employee as it relates to the medical 
conditions versus the claims?
    General Hickey. Congressman, I am not sure if I can do that 
yet, but I will try. I will see if we can do that level of 
productivity look. I know I will be better able to do it when 
we are in VBMS than I can do today. But, I will look and see if 
I can, and if I can, I will certainly provide it to the 
Committee.
    Mr.  Michaud. Yes, because I think that's very important. 
Sometimes the numbers might not bode out as how productive you 
are or not being.
    Also, getting back to my original comment, when you look at 
some of the worst sites that we have in the system, whether it 
is Los Angeles or Nevada compared to some of the better sites, 
Togus and St. Paul.
    Since the system is going to be electronic, are you going 
to be looking at medical conditions and having some of the more 
excellent sites, such as Togus, and St. Paul, deal with the 
more complex medical conditions and than have some of the 
claims that are not complex to at the poor performing sites?
    General Hickey. So, Congressman, that is a great question 
and this is exactly part of the look that we are taking from a 
strategy perspective. And I say it this way, by 2015 when we 
are completely paperless and we will be completely paperless 
earlier than that. But by 2015, we will have the availability 
to know at the medical issue level who are the best people 
across the country that do TBI, that do PTSD, that do knees, 
that do diabetes, that do Parkinson. And we will be able to, 
not by what we do today, pack up a whole bunch of big, thick 
claims, put them in a box, put a whole bunch of effort into the 
things that have to go in there to make sure we are tracking it 
right, mail it, check it in, put it in another place in the 
regional office, we won't. Today, 25 stations can move work 
around between themselves by pushing a button and it is 
brokered.
    Mr. Michaud. So what are you saying? We can adjudicate 
numerous medical conditions simultaneously, in VBMS?
    General Hickey. It is part of a strategy, going into a 
paperless environment, is to see what the--if we have the art 
of that possible and we are capable of doing that and going 
faster as a result of doing it. And a higher quality as a 
result of doing it. It is an equation for me.
    Mr. Michaud. Looking at testimony over on the Senate side 
from the DAV last week, Joe Violante had a lot of praises for 
what VBA has been doing, even though they are frustrated with 
the backlog.
    He also had mentioned some recommendations as well, as far 
as VBA bringing in an independent panel of IT experts to review 
the plan and progress of the VBMS, such as Google, Apple, 
Amazon. Is that something that the Department is willing to do?
    General Hickey. So, thanks, Congressman. I don't have an 
OIT person or an IT person here representing us on the panel, 
but I will tell you there is lots of independent verification 
that we are doing inside of EBA for a lot of our different 
programs.
    In fact, our claims ingest--our Veterans Claim Ingest 
Program, which is our way now that we're getting into a 
paperless environment, our scanning and the like, has now an 
independent verification contract on it to help us make sure we 
know that we are doing it right and well.
    I will take that one for the question, respond to that one 
for the question. I just don't have all the clean insights into 
everything that happens on the IT side relative to that.
    Mr. Michaud. Thank you. And my last question. I know we've 
heard from the big six veterans service organizations and you 
have sat down with them continuously as they raise concerns 
about VBMS, because of their work with the National Service 
Officers.
    Have you reached out to the Iraq and Afghanistan Veterans 
or other groups as well, even though they don't have service 
officers?
    General Hickey. I have two meetings that I do on a monthly 
basis. One meeting is with our big six VSOs with the national 
service officers. Another meeting is with our great 
organizations like MOA and others like Navy League, all those 
kinds of organizations.
    I have invited, on that second panel, to meet with IAVA in 
that group and I am more than willing to do so.
    Mr. Michaud. Okay. Thank you. I yield back, Mr. Chairman.
    The Chairman. Thank you very much, Mr. Michaud. Real 
quickly, you have talked about being completely paperless by 
2015, I know that is the goal. That is a great laudable goal, 
as are most of the goals VA sets up. But given some testimony 
that we received here in the Committee weeks ago regarding the 
individual electronic health record, it appears that VA and DoD 
are going on divergent paths again and DoD is fighting the 
change that's coming. How is that going to impact your ability 
to adjudicate the claims. They say they cooperate, but they 
don't cooperate.
    General Hickey. Chairman Miller, thanks for the question. 
I'll tell that I am not IEHR, that is more on the health 
administration side, though, when it is here it will obviously 
benefit us, so I would prefer to take that piece for the 
record. But I will tell you I am not waiting for anything like 
that to--I am doing right now under a different agreement with 
DoD, getting our hands on the complete medical record, the 
contract medical records, the tricare medical records, all 
brought together with a letter on top from DoD certifying they 
have gone through the complete thing and everything is there 
and they're presenting that to me now for point forward, all of 
our Veterans are coming out now.
    The Chairman. Okay. And also you highlighted e-benefits. 
You have a great faith in that; here is a question that was 
brought to me that you can take for the record. Apparently, you 
can only download one page of documents to your e-benefits 
file. Then it can take upwards of 75 days before it is 
reflected as received in the system?
    General Hickey. Chairman, I have to say that I don't 
believe that that is accurate. I can tell you, I can download 
and I have downloaded my complete personnel records and it 
didn't take one page times all the rest of them. I got them in 
a PDF version, I download them, I have them in my little, I 
love me file at home and, no, it doesn't take all that time to 
upload and upgrade that----
    The Chairman. Well, it wasn't the time to upload, it is how 
soon after you downloaded or uploaded all of that information 
did it show up as received into the system?
    General Hickey. I will go back and find out. I would love 
to have the information that you have and go back and check on 
it and I would be happy to provide you an answer to this.
    The Chairman. Here it is, handwritten. Thank you very much 
for being here for two hours. We appreciate you testifying and 
providing the answers. I am sure that there are questions that 
we will submit for the record. I appreciate both you and Ms. 
Rubens being here. Once again, I want to say, thank you for 
being here and being part of this discussion. This hearing is 
adjourned.

    [Whereupon, at 12:02 p.m. the Subcommittee was adjourned.]



                            A P P E N D I X

                              ----------                              

            Prepared Statement of Hon. Jeff Miller, Chairman
    The Committee will come to order.
    Good morning everyone. Welcome to today's Full Committee hearing on 
a topic that is not a new one for this Committee, namely, needed 
improvements to the disability claims processing system.
    As of this week, VA had nearly 900,000 pending claims, with over 70 
percent pending for longer than VA's targeted processing time of 125 
days. Recently, VA has rolled out its ``transformation plan'' as a 
means to address the growing backlog of claims. Pursuant to Merriam 
Webster's dictionary, ``transformation'' means the act of changing in 
composition or structure.
    Similarly, ``plan'' is defined as a detailed formulation of a 
program or action. However, what we have seen from VA so far does not 
amount to a significant change in the culture of the organization, nor 
has VA provided a very detailed formulation of its plans for moving 
forward.
    Although it is my hope that VA is truly committing to changing the 
culture of the department. Most of what we have seen so far consists of 
repackaging old initiatives with new Power Point presentations and 
impressive buzz words.
    Speaking of buzz words, VA has repeatedly stated that it plans on 
accomplishing its transformation plan by focusing on ``people, process, 
and technology.'' Our purpose today is to focus on the first of these 
three elements - people.
    Although much emphasis is placed on the process and technology 
components, I believe that the ``people'' component may be the most 
important. There are thousands of men and women who, on a daily basis, 
work through the growing backlog of claims and their efforts should not 
go unacknowledged. Nonetheless, the more people VA hires to process 
claims, the worse the department's productivity is.
    Indeed, as the first chart shows, in 1997, the average VA field 
employee processed 135 claims per year whereas in 2011, that number had 
dropped to 73 claims per year. Further, as the second chart shows VA 
has nearly three times as many field employees to do the work now than 
it did fifteen years ago. One would think that working fewer cases per 
employee would result in higher accuracy rates . . . but accuracy is 
stagnant, and as the budget has grown exponentially. Unfortunately, so 
too have processing delays.
    As I have stated many times before, there are many people - myself 
included - who are losing patience as we continue to hear the same 
excuses from VA about increased workload and increased complexity of 
claims.
    Let me give everyone an example from VA's own budget books: I 
quote, ``the effect of the military drawdown on VA's claims process is 
marked not only by a large volume of claims being received, but also by 
increasing complexity of those claims;'' ``as a result of the pre-
discharge counseling being given to service personnel . . . veterans 
have been claiming more conditions on their initial applications;'' 
``instead of the traditional two to three disabilities per claim, 
regional offices are dealing with 10 to 15 issues per claim.''
    I could go on, but does this sound familiar to everyone? It should, 
because what i just read to you was from VA's February 1994 budget 
submission. VA has and will encounter complications along the way. 
However, VA's demonstrated history shows its inability, or refusal, to 
forecast problems and anticipate its needs and the only people paying a 
price for this failure are the veterans. The time for excuses is over.
    So, Under Secretary Hickey, we are here today to have an honest 
discussion about the people who make up VBA - from file clerks to RO 
directors to VA central office management, and on how you intend to 
transform this workforce through better accountability and workload 
management practices.
    I recently had the opportunity to travel to the Baltimore Regional 
Office. I was able to observe new employees' Challenge Training. I also 
learned more about the station enhancement training that the Baltimore 
Regional Office will soon undergo.
    Although proper training is important, I'd like to reiterate that 
it is not enough. VA also needs to remain focused on accountability and 
better workload management practices. For example, one of the words we 
hear most when VA is called before us is ``Nehmer.''
    Nehmer, a class action lawsuit that requires VA to prioritize 
certain Agent Orange presumptions - did significantly add to VA's 
workload. However, during the 111th Congress, Secretary Shinseki 
testified before this Committee that VA would easily be able to fast-
track those claims. I quote, ``by 2013, we will be back to where we are 
today at about 161 days'' to process a claim.
    Under Secretary Hickey, as you know, we are not there today. On the 
contrary, we are at nearly 280 days for an initial rating decision. 
Without better workload or surge capacity planning, I fear that VA is 
simply one national mission away from complete collapse and utter 
failure.
    This is simply unacceptable, so again, we are here today to explore 
how the people who make up VA can prevent this scenario from happening. 
I'd like to thank Under Secretary Hickey for being here today, as well 
as those who submitted statements for the record.
    I now yield to our Ranking Member, Mr. Michaud.

                                 
  Prepared Statement of Hon. Michael Michaud, Ranking Minority Member
    Thank you very much, Mr. Chairman, for holding this hearing today.
    I would like to take a brief moment to recognize that it has been a 
decade since the start of Operation Iraqi Freedom. The wars in Iraq and 
Afghanistan have claimed 6,669 American lives with 50,554 wounded in 
action and countless others suffering from mental injuries as a result.
    Thank you to our veteran advocates on this Committee and in the 
audience who have worked hard to assist these fine men and women.
    Since March of 2003, there is much that we should be proud of: a 
post 9/11 GI Bill that ensures these veterans have the opportunity of 
an excellent college education, record increases in the 
administration's budget for VA programs and services that have led to 
better care and access for our Nation's veterans, and many others.
    However, despite these positive outcomes, we all know that 
challenges remain.
    Of great importance to not only current era veterans, but all 
veterans, is our need to fix the broken claims processing system.
    While the VA continues to process more claims than at any other 
time in its history, demand continues to outpace production. Today, 
VA's total inventory is approaching 900,000 claims with more than two-
thirds, or 632,000 of these claims considered as part of the backlog.
    However, despite the growing backlog I am encouraged by some of the 
recent developments and by the shift in attitude regarding VBA's 
efforts to fix the backlog.
    Nonetheless, while I appreciate the Secretary's goal of having no 
veteran waiting for longer than 125 days with an accuracy rating of 98% 
by 2015, I question whether this very, very, ambitious goal is 
achievable. It would require the VA to complete approximately 3.4 
million claims in two and a half years. To accomplish this goal, the VA 
must start averaging the completion of 1.36 million claims a year; this 
is a 33 percent increase in productivity. These are loose projections, 
and I hope that the VA has better ones, but in my mind, the math simply 
doesn't add up.
    I also question whether VA is being upfront with Congress about its 
challenges. In particular, does VBA have enough employees to get the 
job done? I am not convinced that it does. And is VBA getting all of 
the information that you need from the Department of Defense in a 
timely fashion? I don't believe it is.
    VA's ability to process claims in a paperless electronic 
environment can only be as good as the information that goes into it. 
If you don't have the resources required, and you are not receiving 
information from DoD, or other agencies, we need to know about it.
    Further, I am concerned that VBA is simply trying to automate a 
claims process that, at the end of the day, doesn't work. I hope to 
hear some of your ideas as to how your workload management will change 
in an electronic setting.
    Can VA visualize an electronic system in which a Veterans claim 
comes in not as a claim, but broken down into the various medical 
conditions?
    For our purposes let's suppose there are 13 medical conditions in a 
claim. These 13 medical conditions are not sent through the segmented 
lanes of the veterans' local regional office; they are sent to 13 
Regional Offices throughout the country, electronically, 
simultaneously, to be adjudicated at the same time.
    Different RO's specialize in different medical conditions. 
Challenged RO's get the easy medical conditions; Great RO's get the 
work that is the most complex. And most importantly, veterans get paid 
as each medical condition is completed. I challenge VA to begin 
thinking outside of the box.
    It is an old adage that a benefit delayed is a benefit denied. Far 
too many veterans are waiting far too many days to receive the benefits 
they have earned. We are all working toward the same end - timely and 
accurate dispositions of claims. If we are to be successful we must 
work together to achieve a claims system that lives up to the service 
and sacrifices of our veterans.
    Thank you, Mr. Chairman. I yield back.

                                 
                  Prepared Statement of Hon. Tim Walz
    I want to thank Chairman Miller and Ranking Member Michaud for 
holding the hearing on Wednesday, March 20, 2013 titled: ``Focusing on 
People: A Review of VA's Plans for Employee Training, Accountability, 
and Workload Management to Improve Disability Claims Processing.'' 
Ending the disability claims backlog is of the utmost importance to 
veterans and their families. The Chairman's and Ranking Member's focus 
on the issue is commendable.
    The Department of Veterans Affairs (VA) disability claims backlog 
has been decades in the making, with many contributing factors. In 
2009, with support from my-self and other Members of Congress, 
Secretary Shinseki made the decision to establish presumptive service-
connection for three additional illnesses associated with exposure to 
Agent Orange. Since this decision, VA has already reviewed more than 
140,000 past claims for these diseases and is in the process of 
reviewing more than 40,000 additional past claims.
    But more than anything else, the backlog is the result of 12 years 
of war. When the decision was made to invade Iraq in 2003, the country 
was ill-prepared to care for all the returning war veterans that would 
ensue. Approximately 45 percent of Iraq and Afghanistan veterans are 
currently seeking compensation for injuries related to their service--
that marks a ``historical high'' compared to previous wars. Many of 
these veterans are coming home with severe and complex injuries; which 
is why today's claims include an average of 8 to 10 medical issues per 
claim, more than double the Vietnam era.
    Needless to say, we can't allow these challenges to prevent us from 
delivering timely care and benefits to our returning servicemembers. 
Our veterans deserve to come home to a government that provides the 
same excellent service that we demanded of our servicemembers. Congress 
must work with VA leadership to break this backlog. I believe that the 
VA leadership possesses the will and the skill to break the backlog. My 
friend Bob Wallace, Executive Director of the Veterans of Foreign Wars 
of the U.S., recently stated it best:

    ``The Veterans of Foreign Wars of the United States strongly 
believes in holding public servants accountable, but Allison Hickey was 
handed a tremendous challenge less than two years ago when she became 
the VA Undersecretary for Benefits, a challenge that continues to be 
compounded by an aging veterans' population, additional presumptive 
service connections for Vietnam and Gulf War veterans, and the influx 
of new claims from Iraq and Afghanistan veterans. The VFW believes Ms. 
Hickey is an integral part of the solution to finally breaking a 
backlog that previous Administrations and Congresses helped to create 
by underfunding the critical areas of automation and staffing. Thanks 
to the President and Congress, the VA now has the necessary resources 
to automate the claims processing system and move in the right 
direction, but after years of neglect, the fix will not come 
overnight.''

    I understand that it is Congress's responsibility to provide 
oversight over the Department of Veterans Affairs. But any criticism 
directed towards VA leadership must be constructive. Pointing fingers 
will not help. I recently suggested to Undersecretary Hickey that VA 
stop taking a ``one-size fits all'' approach to training and begin to 
tailor training to the needs of employees based on their experience and 
location. I was pleased that Undersecretary Hickey acknowledged this 
shortcoming and agreed to reevaluate their training programs.
    I want VA's transformation to be successful though I have concerns, 
particularly with: VA's ability to get records from the Department of 
Defense in a timely fashion; how VA plans to operate in an electronic 
environment; receiving qualifying data from VA regarding the 
transformation; proper staffing ratios at VA Regional offices. 
Nonetheless, I am optimistic that VA is moving in the right direction 
in regards to their efforts to create a paperless processing system. I 
am convinced that we can break the backlog. If we can put a man on the 
moon, we can certainly ensure that veterans receive the benefits 
they've earned in a timely fashion.
    I look forward to continue working with the Veteran Service 
Organizations, my colleagues on the House Veterans Affairs Committee 
and VA leadership to develop a strategy to meet the growing needs of 
our veterans.

    Sincerely,

    Tim Walz

    Member of Congress

                                 
               Prepared Statement of Hon. Jackie Walorski
    Mr. Chairman and Ranking Member, it's an honor to serve on this 
Committee.
    I thank you for holding this hearing on an issue that significantly 
affects our Nation's veterans.
    This is an issue that greatly concerns me, and I stand firm in my 
resolve to continue the work of this Committee until real progress is 
made. I want the 50,000 \1\ veterans back in Indiana's Second 
Congressional District, and the approximately 22,000,000 \2\ veterans 
overall in this country to know that their voices have been heard.
---------------------------------------------------------------------------
    \1\ There are an estimated 53,318 veterans in IN-02. This data was 
compiled on 09/30/2012, based on the district lines from the 112th 
Congress. http://www.va.gov/vetdata/Veteran--Population.asp.
    \1\ There are an estimated 22,700,000 veterans in the United 
States. Department of Veterans Affairs, Office of the Actuary, Veteran 
Population Projections Model (VetPop), 2007, Table 5L. http://
www.va.gov/vetdata/docs/quickfacts/Population-slideshow.pdf.
---------------------------------------------------------------------------
    The Veterans Administration cannot continue to make false promises. 
The VA must act now. It is completely unacceptable that the backlog 
grew from 180,000 claims to 594,000 claims in the period from 2009 to 
December 2012. \3\
---------------------------------------------------------------------------
    \3\ Department of Veterans Affairs (VA) Strategic Plan to Eliminate 
the Compensation Claims Backlog. 25 January 2013. https://
www.documentcloud.org/documents/612897-va-strategic-plan-jan-2013.html.
---------------------------------------------------------------------------
    The backlog and consequent wait times for the veterans is 
demoralizing. I have heard from veterans who feel completely helpless 
as a result of the way they must wait to receive the care they 
desperately need. These men and women and their families have 
sacrificed much to protect the liberties we are grateful for.
    I look forward to working with my colleagues and our panelists, 
today, to ensure our veterans do not become another statistic lost in 
the system.
    Thank you.

                                 
                Prepared Statement of Allison A. Hickey
    Good morning, Chairman Miller, Ranking Member Michaud, and Members 
of the Committee. Thank you for the opportunity to discuss VA's plans 
for employee training, accountability, and workload management to 
improve disability claims processing. My testimony today will focus on 
the employees of the Veterans Benefits Administration (VBA) and the 
transformation initiatives we have underway to help them deliver on our 
commitment to provide outstanding service and timely and accurate 
benefits to our Nation's Veterans, their families, and survivors.
    As a direct result of the budget support provided by the Committee, 
VBA has completed more than one million disability compensation claims 
the last three years in a row - the highest numbers ever in the history 
of VA. Despite this stride, too many Veterans wait too long to get the 
benefits they have earned and deserve. VBA continues to execute a 
Transformation Plan that will enable us to meet the Secretary's goal of 
claims completed in 125 days at a 98 percent accuracy level in pursuit 
of eliminating the claims backlog in 2015.
Meeting the Needs of Veterans
    Veterans, their family members, and Survivors deserve our very best 
performance and the ability to deliver an array of benefits and 
services that Veterans have earned - faster, more accurately, and with 
greater efficiency and effectiveness.
    It is the growing inventory of disability claims, and our need to 
quickly process those claims, that is driving the urgency with which we 
are advancing our Transformation.
    VBA completed over one million claims per year in fiscal years 
2010, 2011, and 2012. Yet the increased productivity in claims 
processing was not enough to keep pace with the number of claims 
received in several of those years. In 2010, VBA received 1.2 million 
claims. In 2011, VBA received another 1.3 million claims, including 
claims from Veterans made eligible for benefits as a result of the 
Secretary's decision to add three new presumptive conditions for 
Veterans exposed to Agent Orange. In 2012, VBA received 1.08 million 
claims. Over the last three years, the claims backlog has grown from 
180 thousand to 600 thousand claims at the beginning of this month.
    For decades, the VBA system has carried an inventory of pending 
claims, and a backlog that was undefined and therefore confused with 
inventory. In 2010, the Secretary of Veterans Affairs defined the 
backlog as any disability claim pending over 125 days and increased 
transparency by making our performance against our established goals 
available on the internet. The backlog grows when the capacity does not 
match demand.
    In 2009, based on the Institute of Medicine's Veterans and Agent 
Orange: Update 2008, and considering all available scientific evidence, 
the Secretary made the decision to add three presumptive conditions 
(Parkinson's disease, ischemic heart disease, and B-cell leukemias) for 
Veterans who served in the Republic of Vietnam or were otherwise 
exposed to the herbicide Agent Orange. Beginning in 2010, VBA 
identified claims for these three conditions for special handling to 
ensure compliance with the provisions in the Nehmer court decision that 
requires VA to re-adjudicate claims for these conditions that were 
previously denied. Nehmer claims for all living Veterans were completed 
as of April 2012. VA identified the next of kin for the last remaining 
Nehmer survivor claim and awarded benefits in October 2012. As of March 
11, VA has processed approximately 260 thousand claims and awarded over 
$4.5 B in retroactive benefits for the three new Agent Orange 
presumptive conditions to more than 164 thousand Veterans and 
survivors.
    Other factors that have resulted in the submission of more 
disability claims, and hence contributed to the backlog, include VA 
initiatives to increase access, and other conditions that increased 
demand for VA to address unmet disability compensation needs:

Increased Access
    1. Increased use of technology and social media by Veterans, 
families, and survivors to self-inform about available benefits and 
resources.
    2. Improved access to benefits through the joint VA and DoD Pre-
Discharge programs.
    3. Creation of additional presumptions of service connection 
resulting in more claims for exposure-related disabilities.
    4. Extensive and successful use of VA outreach programs to inform 
more Veterans of their earned benefits, which can include compensation 
claims.
Increased Demand
    1. Ten years of war with increased survival rates for our wounded
    2. Aging population of previous era Veterans such as Vietnam and 
Korea, whose conditions are worsening
    3. Impact of a difficult economy
    4. Growth in the complexity of claims decisions as of result of the 
increase in the average number of medical conditions for which each 
claimant files.

    The current composition of the inventory and backlog are claims 
from Veterans of all eras--from Veterans of the current conflicts to 
World War II Veterans who are just now filing a claim for the first 
time. As of January 31, 2013, the largest cohorts of claims come from 
our Vietnam-era Veterans who filed 448 thousand claims in FY 2012, and 
currently make up 37 percent of the inventory and 38 percent of the 
backlog. Gulf War Era Veterans make up 23 percent of the total 
inventory and 22 percent of the backlog. Veterans of Iraq and 
Afghanistan conflicts make up 20 percent of the total inventory and 22 
percent of the backlog. Veterans of the Korean War and World War II and 
all others make up less than 10 percent of both total inventory and 
backlog. The remainder of the inventory and backlog is from Peacetime 
Veterans only.
Transformation
    To meet the Secretary's goal of eliminating the backlog by 2015, we 
have set out to transform VBA into a 21st century organization. VBA's 
transformation is demanded by a new era, emerging technologies, and the 
latest demographic realities. In the face of increasing complexity and 
workloads, VBA must deliver first-rate and timely benefits and services 
- and they must be delivered with greater efficiency. VBA is 
aggressively pursuing its Transformation Plan, a series of tightly 
integrated people, process, and technology initiatives designed to 
eliminate the claims backlog and achieve our goal of processing all 
claims within 125 days with 98 percent accuracy in 2015. VBA is 
retraining, reorganizing, streamlining business processes, and building 
and implementing technology solutions based on the newly redesigned 
processes in order to improve benefits delivery.
People
    We very deliberately put our employees - our people - at the 
forefront of our transformation plan, as they are the heart of our 
mission and absolutely critical to achieving the Secretary's goal of 
completing all claims in 125 days at 98 percent accuracy in 2015. Our 
dedicated employees, 52 percent of whom are Veterans themselves, have 
embraced our transformation efforts and are the key to our success. In 
order to have the best-trained, most efficient, and highly skilled 
workforce, we focused our ``people'' initiatives on strengthening the 
expertise of our workforce - changing the way we are organized and our 
employees are trained to do the work.
    Our workforce is highly skilled and educated. Sixty-three percent 
of our employees have a bachelors' degree or higher. The dedication of 
our employees to our mission is evidenced by a very low turnover rate - 
only 7 percent annually. The average length of service is 11 years; the 
average age is 44; and 14 percent are currently retirement eligible. 
However, over 35 percent of our claims processing employees have less 
than three years experience with VA. We appreciate the budgetary 
support provided by the Committee in recent years that allowed us to 
increase staffing.
Training
    VBA's focus is on providing high-quality, timely, and relevant 
training for both new and experienced personnel. To that end, our 
transformation efforts include redesigned and deployed centralized 
programs and new tools that standardize training for the disability 
compensation and pension benefit programs across our 56 regional 
offices.
Challenge Training and Quality Review Teams (QRTs)
    The productivity of the workforce and the accuracy of decisions are 
being increased through new national training programs and standards. 
VBA instituted Challenge training in 2011 and Quality Review Teams 
(QRTs) in 2012 to improve employee training and accuracy while 
decreasing rework time. Challenge training is focused on overall skills 
and readiness of the workforce, and QRTs focus on improving performance 
on the most common sources of error in the claims processing cycle; 
data on VBA's largest sources of error are captured and analyzed by its 
National Accuracy Team. Today, for example, QRTs are focused on the 
process by which proper physical examinations are ordered; incorrect or 
insufficient exams previously accounted for 30 percent of VBA's error 
rate. As a result of this focus, VBA has seen a 23 percent improvement 
in this area.
    The 1,900 new employees who have received Challenge training decide 
150 percent more claims per day than predecessor cohorts, with a 30 
percent increase in accuracy, (i.e. these new employees decide 150 
percent more claims per day than previous groups of employees at a 
similar stage in their development). This is a marked improvement in 
performance, and is being scaled across the entire enterprise as new 
employees are hired. Five Challenge training sessions are planned for 
FY 2013. As of March 1, 2012, VBA initiated a new Challenge course 
focused on improving the low performing regional offices called Station 
Enhancement Training (SET). The first regional office that completed 
SET experienced a quality increase of eight percentage points in three 
months and the number of claims processed per month increased by more 
than 27 percent. Similar results are being seen by the second RO that 
completed SET in January 2013.
    VBA tracks the impact of these initiatives on accuracy through a 
three-month rolling average accuracy metric that is reported in ASPIRE 
and can be seen online by anyone inside or outside VA. FY 2012 data 
demonstrated a three percent increase in national accuracy standards - 
from 83 percent to 86 percent. The accuracy outcome objectives for the 
next three years are: 90 percent in FY 2013, 93 percent in FY 2014, and 
98 percent in FY 2015.
    The current 12-month measure of the accuracy of our disability 
rating decisions increased to over 86 percent - and further improved to 
over 87 percent when looking at just the last three months. It is 
important to recognize that under the existing quality review system, 
any one error on the claim, no matter how many medical conditions must 
be developed and evaluated, makes the entire claim in error - the claim 
is therefore counted as either 100 percent accurate or 100 percent in 
error, with no credit for anything in between. Issues are defined as 
individually evaluated medical conditions. A claim can, and often does, 
consist of many issues. Each issue represents a series of completed 
tasks, such as development, research, adjudication, and decision, that 
could result in a benefit adjustment for a Veteran, family member, or 
survivor. Given that the average number of claimed issues for our 
recently separated Servicemembers is now in the 12 to 16 range, we do 
not believe the current all-or-nothing measure reflects the actual 
level of decision accuracy achieved. When we measure the same claims 
based on assessments of the individual medical conditions rated 
(``issue-based accuracy''), the accuracy of our decisions is over 95 
percent. This issue-based accuracy approach also affords VBA the 
opportunity to target with precision those medical issues where we make 
the most errors with dedicated training - and improve employee level 
medical issue accuracy.
Training for Experienced Employees
    All claims processors are currently required to complete at least 
80 hours of VBA training annually. VBA's Compensation Service has 
published a National Training Curriculum (NTC) for claims processors 
and requires training at the appropriate skill level for all employees. 
The 80 hours includes mandatory training from NTC, electives from NTC 
on additional topics, and station-determined topics. Training is 
conducted on issues of high interest or quality concerns for claims 
processors, such as determining effective dates, determining 
examination adequacy, and rating traumatic brain injury claims - skills 
essential to accurately carrying out their everyday responsibilities. 
The breakout among these three categories is flexible to allow 
adjustments for urgent national and local issues with high impact on 
claims processing.
    VBA invests annually in the development, maintenance, and 
management of formal training products and performance support tools. 
VBA's formal training system, Training and Performance Support Systems 
(TPSS), utilizes: web-based training for individual learning; 
instructor-led web-based training for virtual classroom training; job 
aids for standardized desktop references; and electronic performance 
support systems (EPSS) to provide quick access to technical and medical 
information that should not be memorized. All TPSS and EPSS products 
are professionally developed and must pass rigorous validation testing. 
TPSS and EPSS products are also utilized during Challenge training.
Station Enrichment Training
    In March 2012, VBA initiated a new Challenge course specifically 
designed to focus on improving decision accuracy and raising the skill 
levels of employees working in low-performing regional offices. Station 
Enrichment Training (SET) is intensive, instructor-based training built 
on VBA's highly successful and redesigned Challenge training for all 
new compensation claims processors. It provides standardized training 
in the technical skills required of VSRs and RVSRs.
    At the first office participating in the SET program, quality 
increased by eight percentage points in three months, and the number of 
claims processed per month increased by more than 27 percent. Since 
SET, this office has met or exceeded its performance goals each month. 
Based on the success of SET in the first office, VBA has since expanded 
SET to two additional regional offices in this calendar year.
Change Management Training
    Our Transformation, with its integrated people, process and 
technology initiatives, represents the largest single reinvention this 
organization has ever seen -and our focus is on managing this change 
while sustaining production and improving quality. We recognize the 
importance of helping our employees fully understand and prepare for 
the major transformative changes being implemented. For each of the 
transformation initiatives, VBA developed and fielded formal training 
to prepare employees with consistent information - delivered at the 
right time. Web-based training allows employees to learn at their own 
pace and includes assessments for employees to confirm their learning.
Change Management Agents
    VBA hired Change Management Agents (CMAs) at each regional office 
and trained them as front-line proponents for transformation. CMAs 
provide support to regional office employees to guide them through 
changes and help them communicate their concerns. CMAs help regional 
office management and VBA leadership by guiding implementation of each 
initiative and channeling employee feedback. CMAs also ensure that 
appropriate communication occurs with a variety of VA and external 
stakeholders. VBA remains dedicated to helping employees prepare for 
the changes and achieve success through improved processes and 
technology.
Transformation Organizational Model
    VBA's new standardized organizational model incorporates a case-
management approach to claims processing. VBA is reorganizing its 
workforce into cross-functional teams that give employees visibility of 
the entire processing cycle of a Veteran's claim. These cross-
functional teams work together on one of three segmented lanes: 
express, special operations, or core. Distinct processing lanes are 
based on the complexity and priority of the claims and employees are 
assigned to the lanes based on their experience and skill levels. 
Claims that predictably can take less time flow through an express lane 
(30 percent); those taking more time or requiring special handling will 
flow through a special operations lane (10 percent); and the rest of 
the claims flow through the core lane (60 percent). Lanes were 
established based on the complexity and priority of the claims and 
employees are assigned to the lanes based on their experience and skill 
levels.
    The Express Lane was developed to identify those claims with a 
limited number of medical conditions (1-2 issues) and subject matter 
which could be developed and rated more quickly, including fully 
developed claims. The Special Operations Lane applies intense focus and 
case management on specific categories of claims that require special 
processing or training (e.g., homeless, terminally ill, military sexual 
trauma, former prisoners of war, seriously injured, etc.). The Core 
Lane includes claims with three more medical issues that do not involve 
special populations of Veterans. Less complex claims move quickly 
through the system in the express lane, and the quality of our 
decisions improves by assigning more experienced and skilled employees 
to the more complex claims in our special operations lane.
    Initially planned for deployment throughout FY 2013, VBA 
accelerated the implementation of the new organizational model by nine 
months due to early indications of its positive impact on performance. 
Given the magnitude of this change, each office transitions to the new 
organizational model individually. Significant support and training 
from VBA Headquarters have been critical in this stage. As of the end 
of 2012, the new organizational model was fully operational at 51 
regional offices, and three more have since implemented the new model. 
The remaining two regional offices will implement the model by the end 
of this month.
Accountability
    VBA holds employees at all levels of the organization accountable 
for performance as we continuously strive to fulfill our commitment to 
providing timely and accurate benefit decisions. Objective measures and 
performance standards are used to make basic determinations that our 
managers and employees are meeting or exceeding their job requirements. 
Procedures are in place to reward our best performers and to work with 
employees who need additional training to improve performance.
Accountability for Claims Processing Employees
    Employees receive on-going feedback on the elements included in 
their performance standards. Training continues to be a priority to 
achieve our performance improvement goals and is provided in a variety 
of methods, in addition to those already highlighted in this testimony. 
For example, training is conducted through a national Quality Call 
every month, where several staffs from Compensation Service address 
error trends identified through national and regional office-specific 
assessments.
    If a supervisor determines that an employee is not meeting his or 
her performance standards, the supervisor will identify specific, 
performance-related problems. The supervisor and employee will develop 
a written performance improvement plan to identify specific performance 
deficiencies, successful level of performance, actions that must be 
taken to be successful, and the methods that will be used to measure 
improvement. The performance improvement plan provides the employee a 
reasonable opportunity to resolve performance-related problems. 
Generally, the plan covers at least 90 calendar days, but it may be 
extended.
    We recognize the importance of assessing the impact of our 
transformational initiatives on employees' job requirements and 
appropriately adjusting performance standards. Performance standards 
and objective measures are used to make a basic determination that an 
employee is meeting their job requirements. We recently revised our 
performance standards, and are still within the 90 day period of 
implementation. The new performance standards account for segmented 
lanes and ensure that work credit is assigned appropriately. VBA 
established a new team to work in conjunction with AFGE to continue to 
develop standards that will better serve Veterans as we move into an 
electronic environment.
    This past year, the VBA Mid-Term Bargaining Committee, comprised of 
members representing the American Federation of Government Employees 
(AFGE) and VBA management, worked in partnership and through pre-
decisional involvement to support the design and deployment of all our 
transformation initiatives. VBA leadership ensures that all pilots of 
potential transformation initiatives include our labor and VSO partners 
to build the process with the employee in mind. In addition, pre-
decisional briefings on transformation were provided to help pave the 
way for negotiations. The team resolved many issues and reached 
agreement on approximately twenty memorandums of understanding.
Skills Certification
    VBA incorporated its skills certification program in the 
Transformation Plan, as it is an important tool to ensure 
accountability for claims processors. Public Law 110-389, Section 225, 
required skills certification testing for employees and supervisors who 
process claims for compensation and pension benefits. Since August 
2003, VBA has maintained a skills certification testing program. Tests 
are currently administered on a regular basis for the following 
positions: VSR, RVSR, Supervisory VSR, Pension Management Center VSR, 
Decision Review Officer and Coaches. Employees and supervisors are 
required to achieve certification and recertify every two years.
    Public Law 112-154, Section 703, added the requirement that VBA 
regularly assess the skills and competencies of appropriate employees 
and managers responsible for processing claims for compensation and 
pension benefits, as well as take appropriate personnel action if 
employees and supervisors are unable to pass the test following 
training and reassessment. We have developed a plan to regularly assess 
the skills and competencies of employees who process claims for 
compensation and pension benefits. Implementation of this plan will 
occur after notification and appropriate action is taken with labor 
partners to address its impact and implementation.
    As a result of extensive labor-partner input obtained in a labor 
and management forum, VBA is considering various options to implement 
the provision of the law requiring VBA to take ``appropriate personnel 
action'' if training and reassessment does not result in satisfactory 
skills and competencies. VBA is reviewing the input of our labor 
partners to formulate options for those employees who do not pass the 
skills certification test after additional training and reassessment. 
Regardless of which option is selected, VBA will bargain on issues 
related to impact and implementation, as is required by the AFGE Master 
Agreement.
Workload Management and Accountability for Senior Managers
    ALL VBA senior managers of regional offices are held accountable 
for effective workload management and the resulting performance of 
their offices. Performance is evaluated against national and regional-
office-specific targets that are based on our strategic goals. The 
targets are established at the beginning of each fiscal year and 
account for a variety of measures, including timeliness, production, 
and inventory. Performance expectations are established based on the 
previous year's performance, giving consideration to current staffing 
and anticipated receipts at each regional office. VBA's Office of Field 
Operations and the Area Directors routinely review the performance of 
regional offices and their leadership teams. The performance is 
measured against established targets, workload, and staff turnover.
    VBA aggressively monitors regional office workload trends and 
performance, and as negative trends develop, Area Directors establish 
and monitor performance improvement plans for regional office directors 
to ensure appropriate attention is given to problem areas. The 
performance improvement plans identify any deficiencies such as 
productive capacity, quality, or timeliness. Often, a challenged 
regional office will engage a high performing station to share best 
practices and identify opportunities for improvement.
    VBA's office of Field Operations and the Area Directors actively 
participate in rehabilitating an underperforming regional office. VBA 
established a Workload Management Training Program to train new 
supervisors in workload management. VBA will also host classes at the 
facility to re-engage claims processors and management staff. The new 
SET program previously discussed is an important new tool for 
performance improvement. The Area Directors will engage in more 
frequent communication with an underperforming office, through frequent 
site visits, teleconferences, and written and electronic 
communications. If a Director cannot successfully lead a regional 
office to improvement, subsequent performance action will be taken 
during performance appraisal periods. These actions may include 
retirement, reassignment, or downgrade.
Stat Reviews
    VBA's Stat Reviews are a performance technique and tool using 
statistical data (Stat) and visual displays of that data to monitor 
progress and improve performance. This process involves in-depth 
performance metric reviews with the Under Secretary of Benefits (USB) 
and other top VA leaders, as well as VBA's Office of Field Operations 
and other members of the VBA leadership team, to analyze and manage 
performance more effectively.
    VBA's Stat Reviews are based on highly successful performance 
management programs conducted government-wide. As USB, I sit at the 
table with regional office directors in the day-long meeting to discuss 
challenges and successes, using extensive data driven performance 
measures for accountability. This allows VBA leadership to more easily 
identify what improvements are needed to produce desired performance 
results. Stat Reviews also help VBA leadership understand what is or is 
not working, while motivating regional office managers and employees to 
focus their energy and creativity on achieving specific results.

    The Stat Review process encourages:

    1. Focus on accountability to achieve workload performance metrics.
    2. Information-sharing of best practices across VBA regional 
offices and VBA leadership.

    As a monthly event with Directors and a bi-weekly update with the 
USB, the Stat Reviews identify patterns occurring at various regional 
offices, and every regional office participates either in person or by 
teleconference. These reviews help to ensure we have alignment across 
ROs on Transformation and that best practices and lessons learned are 
shared quickly across leadership teams.
Career Trajectory
    VBA believes very strongly in providing employees with growth 
opportunities and therefore provides a career trajectory for claims 
processing employees working across the nation. Over the past two 
fiscal years, VBA promoted 1,061 claims processing employees, 
including:

      258 claims assistants promoted to Veterans Service 
Representatives (VSRs),
      542 VSRs promoted to Rating VSRs (RVSRs); and
      261 RVSRs promoted to Decision Review Officers (DROs).

    The knowledge and experience our employees bring to their jobs as 
they are promoted to more technical and leadership positions are 
invaluable to our organization. Developing our employees for positions 
of greater responsibility helps to ensure employees understand the 
various roles in the claims process and our institutional knowledge is 
preserved and enhanced.
    Helping employees understand the skill requirements of their 
current and potential future positions is a key component of VBA's 
succession planning. VBA has built competency models that describe in 
detail the general and technical skills and competencies required for 
15 critical and nationally standardized positions across its six lines 
of business. VBA is now focusing on developing a repeatable process of 
curriculum mapping, using the VSR position as a proof of concept. When 
complete and loaded into VA's Talent Management System, employees and 
their supervisors will use the competency models to evaluate and 
address learning needs and performance improvement opportunities for 
employees. The competency models will help to specify the learning, 
experience, and other qualities necessary to perform job tasks. 
Employees and those who desire to work with VBA will also benefit from 
these models, as they provide the foundation for VA's on-line career 
mapping tool [email protected], which itself has a broad audience of some 
575,000 users (to date, since October 2011).
    VBA has planned for employee growth in both leadership 
opportunities and technical expertise to ensure the long-term health of 
the organization. For all business lines, VBA's Office of Employee 
Development and Training develops and manages leadership and 
professional development programs. Our five national leadership 
development programs reach a wide population of leaders and potential 
leaders throughout our organization with programs for emerging leaders 
(GS 5-9) through our executive development series (SES). These 
competitive programs are available to employees from all regional 
offices and centers. Each program provides instructional and 
experiential learning opportunities as well as mentoring to enhance 
each participant's growth.
Incentives
    VBA utilizes a three-tier incentive program to recognize 
individuals and regional offices for excellent performance during the 
fiscal year. Individual recognition (level I), awards are given to 
those employees whose performance significantly exceeds their 
performance requirements. All performance requirements for claims 
examiners contain critical elements for both quality and timeliness/
production. At the heart of the performance award program is a 
foundational focus on quality. Funding for level one of the program is 
distributed to regional offices based on a percentage of total salary 
for each office. Level one funds are paid out to individual employees 
locally as incentive awards, and the criteria for performance are 
determined locally and vary across regional offices.
    Group awards (level two) are made to offices or elements of offices 
that achieve and exceed performance targets. Funding for level two of 
the program is distributed to regional offices for meeting key 
performance targets during the fiscal year, including all claims 
accuracy goals. Funding for level two awards is pro-rated based on 
total salary for employees in each business line for which the regional 
office met the level two criteria.
    Special contribution awards (level three) of the program are 
reserved for recognition by the Under Secretary for Benefits. 
Recommendations at this level are made by the Deputy Under Secretary 
for Field Operations.
Employee Morale
    Today VBA and our employees face enormous challenges - and we need 
the talents of each and every one of our employees to overcome those 
challenges and succeed in our Transformation. Our employees demonstrate 
every day that they are motivated to make a difference in the 
organizations where they work and in the lives of those they serve. 
Their strongest motivation is their dedication to our unique mission of 
service to America's Veterans, their families and Survivors.
    We recognize our responsibility for developing, sustaining, and 
nurturing our employees - highlighting their accomplishments, 
addressing their concerns, and giving them the training and tools they 
need to deliver quality benefits and services to the Veterans and 
families who are turning to them for assistance.
    Our directors use a number of innovative methods to facilitate 
communications, identify and address issues of concern, and help 
employees understand the importance of the work that they do. Many have 
invited OIF/OEF Veterans to the office to meet and speak with employees 
so they gain a better understanding of the daily challenges our 
disabled combat Veterans face. Town Hall meetings are held with 
employees to improve communications between the management team 
employees, and some managers also hold morning team sessions to ensure 
that employees are kept up-to-date. CMAs also facilitate communications 
between employees and managers related to our Transformation 
initiatives.
    VBA encourages all employees to participate in the annual All 
Employee Survey, the results of which are carefully assessed and 
analyzed to focus on areas needing improvement to promote a healthy and 
motivated workforce. Regional office directors are required to select 
two measures where they have influence to demonstrate improvement in 
metrics. These metrics are evaluated by their Area Director at the end 
of the performance period.
Process Initiatives
    Through process-improvement initiatives, VBA is rapidly developing 
and testing streamlined business processes, focusing on eliminating 
repetition and rework. VBA established a ``Design Team'' concept to 
support business-process transformation, and the ideas and input of our 
employees are the key elements of this concept. Using design teams, VBA 
conducts rapid development and testing of process changes and automated 
processing tools in the workplace. The direct involvement of our 
employees in the design team process enables us to demonstrate through 
pilot initiatives that changes are actionable and effective before they 
are implemented nationwide.
    Since 2009, VBA has actively solicited innovative ideas for process 
improvement not only from our employees, but also from Veterans and 
industry stakeholders through a variety of structured mechanisms. 
Literally thousands of ideas were received and culled down to those 
with the largest potential to attack the backlog. For example, 
automated Disability Benefits Questionnaires (DBQs) (discussed below) - 
arguably one of the most highly leveraged changes - came from one of 
the VBA employee idea competitions. Additionally, VBA also conducted 
Lean Six Sigma and Kaizen events on these selected targets of 
opportunity, all focused on five major areas of focus: wait time, 
rework, productivity, digital intake, and variance.
Simplified Notification Letters
    The Simplified Notification Letter, another employee-recommended 
initiative, has reduced keystrokes and automated production language in 
preparation of the Veteran's decision letter, thus improving rating 
decision productivity and accuracy. VBA implemented this initiative 
nationally on March 1, 2012, and it decreased the number of claims 
``waiting'' for a rating decision by 55 percent. This translated into 
over 10,000 more rating decisions in the month of December (94,292) 
than in the month of March (84,115). The SNL process does not change 
the way we consider and decide claims, but rather changes the primary 
focus of what appears in the final decision document. We do this in 
part through the use of an internal coding system designed to 
streamline processing and communicate standardized reasons and bases 
from the decision makers to the award processors (who generate the 
final notice letters, authorize the monetary awards, and perform other 
ministerial functions). SNL increased the number of auto-text 
selections available for raters to use to explain decisions, thereby 
improving decision accuracy and productivity. SNL allows VBA to meet 
the requirements of the Plain Writing Act focused on simplifying 
communications with benefit recipients.
Calculators and Evaluation Builder
    VBA is building new decision-support tools to make our employees 
more efficient and their decisions more consistent and accurate. We 
have already developed rules-based calculators for disability claims 
decision-makers to provide suggested evaluations. For example, the 
hearing loss calculator automates decisions using objective audiology 
data and rules-based functionality to provide the decision-maker with a 
suggested decision.
    The Evaluation Builder is essentially an interactive disability 
rating schedule. The VBA decision-maker uses a series of check boxes 
that are associated with the Veteran's symptoms. The Evaluation Builder 
determines the proper diagnostic code out of over 800 codes as well as 
the level of compensation based on the Veteran's symptoms. The Veteran 
receives an accurate rating decision every time the Evaluation Builder 
is used. This saves employees time that would have been spent looking 
up the rating schedule in a paper format. To date, five of the 15 body 
systems in the VA Schedule of Rating Disabilities have been embedded 
into VBMS, and the Evaluation Builder will have complete functionality 
(all body systems) in VBMS by November of this year.
Disability Benefits Questionnaires (DBQs)
    DBQs replace traditional VA examination reports and are designed to 
capture all the needed medical information relevant to a specific 
condition at once and up front so that claims can be developed and 
processed in a more timely and accurate manner, with the end result 
being faster service for Veterans. DBQs change the way medical evidence 
is collected, giving Veterans the option of having their private 
physician complete a DBQ that provides the medical information needed 
to rate their claims - minimizing the need for a VA exam which adds 
additional time to the claim development process. Information in the 
DBQs maps to the VA Schedule for Rating Disabilities, and provides all 
of the necessary information to decide a disability claim. Fully and 
properly completed DBQs, whether from private providers or within the 
internal VA examination processes, have the potential to reduce rework, 
the largest category being exams with insufficient information.
    The Veterans Health Administration has completed more than 1.5 
million DBQs to date. In FY 2013 to date, nearly 600,000 DBQs have been 
completed by VHA examiners. Since their introduction, VBA has received 
over 12,000 DBQs outside of the traditional examination process. Using 
DBQs, VA examination and examination-request accuracy improved to 92 
percent nationwide, compared to the legacy quality program, which 
showed accuracy of 84 percent when last conducted in 2009. Seventy-one 
of eighty-one individual DBQs, unique forms designed to document 
specific health conditions are available to private physicians. VBA is 
reaching out to stakeholders, particularly Veterans Service 
Organizations (VSOs), State and County partners, and private medical 
doctors to request their support in encouraging Veterans to use DBQs 
for more timely and accurate rating decisions. VA recently secured DoD 
concurrence to pilot the use of DBQs within the Integrated Disability 
Evaluation System (IDES) process. VBA's future goal is to turn DBQ 
objective responses into data to drive a calculator-based business-
rules engine in VBMS to achieve automated decision support to improve 
consistency and accuracy of decisions and reduce processing time per 
case.
Acceptable Clinical Evidence (ACE)
    ACE is a new approach that was implemented in October 2012. This 
process allows clinicians to review existing medical evidence and 
determine whether that evidence can be used to complete a DBQ without 
requiring the Veteran to report for an in-person examination. For many 
Veterans, this means they no longer need to travel and take time off 
for an examination, which can be a significant burden requiring them to 
leave work and interfering with their family life. Clinicians also have 
the option to supplement medical evidence with telephone interviews 
with the Veteran, or to conduct an in-person examination if determined 
necessary. To date, VA has processed 1,931 claims using the ACE 
initiative.
Compensation and Pension Records Interchange (CAPRI)
    CAPRI software provides VBA employees with a standardized, user-
friendly method to access Veterans' medical records throughout the VA 
healthcare system. In November 2011, VBA stopped printing Veterans 
Health Administration (VHA) treatment records, saving the effort and 
dollars associated with printing, filing, and storing these records. 
Under a partnership with VHA, the CAPRI program has recently been 
enhanced to send records electronically to VBA's paperless repository 
with just a few mouse clicks, further simplifying the process and 
reducing the task time. As of March 1, 2013, 45 sites within VBA have 
received this upgrade, with deployment for remaining sites scheduled to 
begin on March 31, 2013. To date, VBA has avoided printing more than 90 
million pages of digital medical records (currently averaging six 
million/month) and spending over 422,000 man hours printing and filing 
- saving time and resources that are redirected towards backlog 
elimination. Because of these CAPRI enhancements, VBA estimates a $2.5 
million cost avoidance annually on paper and toner that is also being 
used to support staffing resources to help eliminate the backlog.
Fully Developed Claims (FDCs)
    FDCs are critical to achieving VBA's goals and provide a method for 
our VSO and DoD partners to assist in gathering the necessary evidence 
to decide a claim. A fully developed claim is one that includes all DoD 
service medical and personnel records, including entrance and exit 
exams, applicable DBQs, any private medical records, and a fully 
completed claim form. An FDC is critical to reducing ``wait time'' and 
``rework''. VBA currently receives 4.8 percent of claims in fully 
developed form, which equates to 5,600 claims this fiscal year through 
February. When a qualified FDC is received, VBA is able to discharge 
its evidence-gathering responsibilities under the Veterans Claims 
Assistance Act much more efficiently than in traditional claims. This 
evidence-gathering period is a major portion of the current 262-day 
process. Today, VBA completes these FDCs in 117 days. VBA's target for 
FY 2013 is to increase these FDCs to 20 percent with our VSO partners- 
meaning VBA will have the ability, if this goal is reached, to decide 
153,000 additional claims in 117 days.
Internal Revenue Service and Social Security Administration Data 
        Sharing
    In February 2013, VA developed an expanded data-sharing initiative 
with the Internal Revenue Service (IRS) and Social Security 
Administration (SSA) for up-front verification of income for pension 
applicants and to streamline income verification matches. This 
initiative enabled VBA to eliminate an annual reporting surge of 
150,000 work items and redirect significant FTE to address the backlog 
of Dependency and Indemnity Compensation (DIC) claims from Survivors. 
We have doubled our output of DIC claims with this effort.
Technology
    Key to VBA's transformation is ending the reliance on the outmoded 
paper-intensive processes. VBA is deploying technology solutions that 
improve access, drive automation, reduce variance, and enable faster 
and more efficient operations. VBA's digital, paperless environment 
also enables greater exchange of information and increased transparency 
to Veterans, the workforce, and stakeholders. Our technology 
initiatives are designed to transform claims processing from the time 
the Servicemember first enrolls in the joint VA and DoD eBenefits 
system and submits an on-line application to the issuance of the claims 
decision and receipt of compensation payments.
Veterans Benefits Management System (VBMS)
    VBMS is a web-based, electronic claims processing solution 
complemented by improved business processes. It will assist in 
eliminating the existing claims backlog and serve as the technology 
platform for quicker, more accurate claims processing.
    National deployment of VBMS began in 2012, with 18 regional offices 
operational as of the end of the calendar year. Deployment to the 38 
remaining stations is ongoing. We estimate that once VBMS is fully 
developed in 2015, integrated, and implemented, it will help improve 
VBA's production by at least 20 percent (in each of fiscal years 2014 
and 2015) and accuracy by at least eight percent.
    The evolution of VBMS is occurring across four distinct phases, or 
generations of development. Generation One of VBMS began in 2010 with 
the conceptualization, piloting, development, and deployment of 
baseline system functionality with improved quality (required actions 
and automation) and efficiency (no paper). Generation One of VBMS 
concluded with the successful implementation of Release 4.1 in January 
2013. This generation culminated in a foundational web-based, 
electronic claims processing solution featuring:

      Integrated claims establishment, development, and rating 
capabilities;
      Basic baseline automation via features such as automated 
letter generation and data population; and
      Basic workflow and workload management capabilities.

    With the deployment of the latest system release, integration with 
VONAPP Direct Connect (VDC) and the Stakeholder Enterprise Portal (SEP) 
further enhanced the system's capabilities by improving data exchange 
and status transparency with applicants, VSO partners, State and County 
Veterans agencies, and other stakeholders.
    At the end of February, 2013, 1,084 paper-based and electronic 
claims have been rated using VBMS and 77,393 electronic folders 
(eFolders) have been created in VBMS. Claims are being completed in 
VBMS in an average of 92.4 days. There are over 12,000 users of VBMS to 
include VHA and VSOs. VBMS has also successfully received over 2.5 
million documents and over 32.2 million images.
    As we move into Generation Two of VBMS, the focus is on building 
additional system capabilities while leveraging simple automation 
features and deploying the system to all remaining sites. Upcoming 
system releases include planned improvements to correspondence and work 
queue tools, additional rating calculator functionality, and more 
extensive data exchange and system integration capabilities.
    National deployment of VBMS to all 56 regional offices is on track 
for completion in 2013. Each VBMS site deployment is supported by 
organizational change management practices (including training) to 
ensure business lines are able to adapt to and adopt the new 
technologies and solutions.
    Generation Three of VBMS in 2014 will focus on continuing to 
improve electronic claims processing by providing increased system 
functionality and more complex automation capabilities for all VBMS 
end-users. VBMS enhancements will reduce dependency on legacy systems 
for claims establishment, development, and rating. VBMS will have the 
capability to accept electronic Veterans' Service Treatment Records 
(STRs) and Personnel Records from DoD in support of the VOW to Hire 
Heroes legislation. Additionally, VBMS end-users (to include VA Medical 
Center personnel and VSOs) will be able to leverage enhanced system 
functionality to perform their work more efficiently and accurately. 
Development of functionality will provide end-users with the ability to 
process claims electronically from receipt to payment. The addition of 
functionality throughout 2014 and stabilization of system capabilities, 
in conjunction with business process improvements, will increase 
production and quality of claim decisions. This period of stability 
will also allow VA an additional opportunity to assess and validate the 
effectiveness of the model as a whole and implement improvements as 
needed.
    Generation Four of VBMS in 2015 will capitalize on efficiencies and 
quality improvements gained during the year of stabilization. These 
enhancements will allow employees to focus on more difficult claims by 
reducing the time required to process less complex claims. This period 
will also allow VA to identify additional automation and process 
improvement opportunities, enabling VA to meet the Secretary's goal of 
processing all claims within 125 days at 98 percent accuracy.
    When a claim is granted in VBMS, a payment is processed, and 
notification is sent to the Veteran through eBenefits and stakeholders 
through Stakeholder Enterprise Portal (SEP). This notification 
completes the full lifecycle of paperless claims processing, from 
portal to payment.
Veterans Relationship Management (VRM)
    VRM engages, empowers, and serves Veterans and other claimants with 
seamless, secure, and on-demand access to benefits and service 
information. Veterans now have access to benefits information from 
multiple channels - on the phone, on line, or through our shared DoD/VA 
portal called eBenefits. VRM provides multiple self-service options for 
Veterans and other stakeholders.
eBenefits
    eBenefits - a joint VA-DoD client-services portal for life-long 
engagement with Servicemembers, Veterans, and their families - is a key 
component of VRM. eBenefits currently provides users with over 45 self-
service options and greater access to benefits and health information 
at the time and method of their choosing. Through the eBenefits portal, 
users can now check the status of claims or appeals, review VA payment 
history, obtain military documents, and perform numerous other benefit 
actions. Veterans can also view their scheduled VA medical 
appointments, file benefits claims online in a Turbo Claim-like 
approach, and upload supporting claims information that feeds our 
paperless claims process.
    There are currently over 2.5 million eBenefits users, a more than 
800 percent increase since June 2011. Through self-service, eBenefits 
users have generated over 228,000 requests for official military 
personnel documents, 198,000 requests for VA Guaranteed home loan 
certificates of eligibility, 16.5 million claim status requests, and 
over 1.7 million self-service letters. Additional functionality and 
features will continue to be added to the site in the future, and VA 
will use milestones and life events to proactively notify Veterans 
about benefits they may be eligible to receive.
VDC (Veterans Online Application, Direct Connect)
    VDC incorporates a complete redesign of the legacy VONAPP 
application system, leveraging the eBenefits portal. Claims filed 
through eBenefits use VDC to load information and data directly into 
the new VBMS application for paperless processing. Veterans can now 
file both original and supplemental compensation claims through VDC. 
Since the expanded version of VDC deployed in October 2012, over 1,500 
claims have been received.
Stakeholder Enterprise Portal (SEP)
    SEP is a secure web-based access point for VA's business partners. 
This portal provides the ability for VSOs and other external VA 
business partners to represent Veterans quickly, efficiently, and 
electronically. Because SEP is a new release, specific results are not 
yet available.
VCIP
    VBA recently established the Veterans Claims Intake Program (VCIP). 
This program is tasked with streamlining processes for receiving 
records and data into VBMS and other VBA systems. Scanning operations 
and the transfer of Veteran data into VBMS are primary intake 
capabilities that are managed by VCIP. As VBMS is deployed to 
additional regional offices, document scanning becomes increasingly 
important as the main mechanism for transitioning from paper-based 
claim folders to the new electronic environment. The VCIP contractors 
began scanning on September 10, 2012. The ramp-up volume mirrored the 
VBMS deployment plan for the 18 regional offices on VBMS as of the end 
of CY 2012. By the end of December 2012, the VBA contractors were 
providing five million images per month. By the end of CY 2013, the 
contractors will be providing up to 70 million images per month as they 
convert paper records to electronic format.
Strategic Planning and Governance
    VBA's Office of Strategic Planning (OSP) coordinates VBA's 
strategic planning and the governance process for developing new 
transformation initiatives. The focus of this office is on creating a 
culture centered on advocacy for Veterans, reengineering business 
processes, integrating new technologies, and redesigning our 
organization and infrastructure. New ideas are approved through a 
governance process that includes senior VBA leadership who serve on the 
VBA Transformation Governance Board responsible for evaluating and 
making recommendations for my approval. This ensures VBA's focus is on 
implementing initiatives that will achieve the greatest gains, without 
degrading current performance.
    The VBA Implementation Center/Operations Center (VBA-IC/OC) is a 
division of the Office of Field Operations. The VBA-IC/OC prepares, 
executes and assesses the implementation of transformation initiatives, 
managing the project lifecycle through a comprehensive Work Breakdown 
Structure (WBS) and Critical Path methodology. The VBA-IC/OC also 
serves as the liaison between the field and Headquarters throughout the 
implementation process, providing channels of communication that are 
essential to successful implementation. The VBA-IC/OC monitors and 
supports regional offices through an end-user hotline, which is open 
during normal business hours. In addition, I hold weekly three-hour 
``pulse-check'' calls with the employees of all regional offices 
adopting new initiatives to ensure all issues are raised and properly 
assessed. The VBA-IC/OC gathers and reports implementation performance 
metrics to provide support for VA leadership decision-making.
Partnerships
    Support from our partners and stakeholders is critical to better 
serving our Veterans, Servicemembers, and their families. Our 
transformation changes our interactions with employees, other Federal 
agencies, VSOs, and State and County service officers. VBA has worked 
to create partnerships through pilot projects with these organizations 
to improve benefits delivery. I continue to meet monthly with the 
Executive Directors of six national VSOs and have established quarterly 
stakeholder meetings with a larger group of VSOs directly affected by 
new processes and initiatives. VBA engages these organizations for 
their feedback and input at the beginning stages of the various 
initiatives.
    While stakeholder engagement is important to nearly all of VBA's 
transformation initiatives, support from VSOs and State and County 
service officers will be especially critical to the success of four 
initiatives: eBenefits, SEP, FDC, and DBQs. VBA has involved 
stakeholders in development, user-access testing, and training for 
these initiatives, and we are now partnering to increase Veterans' 
awareness and utilization in order to expedite the claims process.
    VBA is exploring incentives for its VSO and State and County 
partners to increase FDC submission because of the game-changing impact 
this can have on claims-decision timeliness and eliminating the 
disability claims backlog. A 20-percent FDC submission level is 
estimated to increase annual production by 70,000 claims and reduce 
overall average days to complete by 18 days.
    VBA has an agreement with DoD to provide 100-percent-complete 
service treatment and personnel records in an electronic, searchable 
format for the 300,000 annually departing Active Duty, National Guard 
and Reserve Servicemembers. This will further increase the number of 
FDCs. When implemented, this action has potential to cut as much as 60-
90 days from the ``awaiting evidence'' portion of claims processing, 
and reduce the time needed to make a claim ``ready for decision'' from 
133 days currently to 73 days for departing Servicemembers.
    VBA will continue to pursue various partnerships with Federal 
agencies, VSOs, as well as profit and non-profit organizations to 
expand and enhance our transformation initiatives.
Conclusion
    VA is in an era of unprecedented production and unprecedented 
demand, and our Transformation Plan is critical to achieving our goals 
for improving the delivery of benefits to our Veterans, their families, 
and Survivors. We will continue to vigorously pursue our people, 
process and technology-centered improvements designed to eliminate the 
claims backlog and achieve our goal in 2015 of processing all claims 
within 125 days with 98 percent accuracy.
    Mr. Chairman, this concludes my statement. I would be pleased to 
answer any questions you or other Members of the Committee may have.

                                 
                       Statements For The Record

   AMERICAN FEDERATION OF GOVERNMENT EMPLOYEES, AFL-CIO AND THE AFGE 
                   NATIONAL VETERANS' AFFAIRS COUNCIL
Overview
    The American Federation of Government Employees and the AFGE 
National Veterans' Affairs Council (hereinafter ``AFGE''), the 
exclusive representative of employees processing disability claims at 
Veterans Benefits Administration (VBA) Regional Offices (ROs) supports 
the Department's Transformation efforts and appreciates the opportunity 
to share our concerns and recommendations regarding employee training, 
accountability and workload management in order to improve the 
timeliness and accuracy of disability claims processing.
Summary of Recommendations
    Training: AFGE urges flexibility to address training needs of 
individual ROs, while maintaining national consistency and quality. 
Also, new employees need sufficient training before being rushed into 
production. Management should be held accountable for providing 
sufficient time for training, including adequate classroom training 
with actual cases incorporated into the curriculum. Front line 
employees and their AFGE representatives should have input into ongoing 
efforts to develop and improve training programs.
    Effective Performance Measures and Workplace Morale: VBA needs to 
create a valid, evidence-based time motion study for all aspects of 
claims process in order to implement fair and accurate performance 
standards. Management should constantly monitor morale and address 
morale issues as a critical component of workplace management.
    Career Opportunities and Management Incentives: VBA should develop 
better VSR incentives to encourage experienced VSRs to stay in their 
current positions through using different tiers, e.g. Super VSRs. 
Managers should credit time already spent in a current position if an 
employee seeks to move from a VSR to an RVSR or DRO position. Pathways 
for promotion should be clearly communicated to employees. Management 
incentives that reward quality should be strengthened. All RO employees 
should be rewarded performance incentives, rather than only managers.
    Greater input from front line employees and their AFGE 
representatives: AFGE and its local officers should be regular 
participants in weekly calls with General Hickey, and have a meaningful 
opportunity to contribute and share their views.
    AFGE surveyed its members processing disability claims to address 
workforce issues. We received responses from the following ROs that are 
discussed below:

      Winston Salem, NC
      Detroit, MI
      Huntington, WV
      Columbia, SC
      St. Paul, MN
      Newark, NJ
      Waco, TX
      Milwaukee, WI
      St. Petersburg, FL
      Pittsburgh, PA
      Jacksonville, FL
      Louisville, KY
      Chicago, IL
      Anchorage, AK
      Togus, ME
      Cleveland, OH
      Los Angeles, CA
      Portland, OR

    VBA employees responding to the Subcommittee's request consistently 
expressed their dedication and sense of purpose in serving the 
veterans. Over half (52%) of VBA employees are veterans themselves, and 
many of these employees receive benefits from the VA. Therefore, many 
have direct personal experiences with the claims backlog. Despite their 
frustrations, VBA employees uniformly remain steadfast in their goal to 
serve veterans, work hand in hand with Veteran Service Organizations, 
and do all that they can to work with VA to lower the unacceptably high 
backlog of cases. As was described by an employee at the Huntington, WV 
RO, ``I, like most of my coworkers, love the job itself. We love 
serving veterans and their families; and take great pride in doing so . 
. . However, I believe there are better, more productive ways to get 
results.''
    VBA has rolled out new standardized training to try to improve 
timeliness and accuracy of the work product. However, ROs consistently 
reported that the new training technique and methodology did little to 
improve timeliness and accuracy. Several of the problems are listed 
below.
One Size Fits All Training
    A consistent theme throughout the ROs is that VBA management takes 
a ``one size fits all'' approach when creating their training 
materials. The training is not broken up between specific offices, and 
longtime employees receive the same training as newer employees. There 
is also no consideration of areas of performance when determining which 
type of training to give which employees. The Jacksonville, FL RO 
stated: ``Employee training is too rigid as far as the mandatory 
national training core subjects and hours required. There needs to be 
more flexibility in order to tailor training to the needs of the RO. We 
wind up training on the same subjects year in, year out without being 
able to have training to accommodate our needs at the local level.''
    For example, in Anchorage, AK, we heard an issue regarding training 
and the new lanes VBMS uses. With VBMS, Veterans Service 
Representatives (VSRs) and Rating VSRs (RVSRs) are placed into 
different lanes in order to allow for quicker cases to move through the 
claims process faster and to give more time and care to the longer 
cases. However, training does not differentiate between the different 
lanes, meaning all VSRs attend training together regardless of which 
lane they have been assigned. This applies for RVSRs as well.
    ROs also consistently mentioned that the training was not dynamic 
and did little to capture listeners' attentions. Training tends to 
consist of reading information off a PowerPoint. They also would prefer 
more group and practical exercises to increase productivity. Many 
employees also complained about the lack of question and answer 
available to them during trainings. The ROs believe that if training 
sessions provided greater opportunity for questions, especially about 
specific cases, training would be that much more effective.
    We recognize that VBA does need to have some sort of 
standardization across ROs in order to maintain consistency. However, 
different ROs face different challenges and have different strengths 
and weaknesses. Training should have some level of flexibility so that 
different ROs can adjust to better prepare employees.
Insufficient New Employee Training
    In recent years, VBA has significantly cut the amount of time 
dedicated to training new employees. VSRs and RVSRs are given an 
initial training period of eight weeks, which is far shorter than new 
employees received in the past (often this training took up to a year 
to complete). A new employee in Winston Salem expressed that though her 
training has been helpful, other employees were not prepared for the 
Challenge training yet were still pushed onto the floor upon 
completion. She recommends that employees not be rushed into processing 
claims until they are fully prepared.
    Management does recognize that training is the cornerstone for any 
success in reducing the backlog. As reported in St. Petersburg, FL, 
they have openly stated that it takes two years to learn these jobs.
    Training for experienced employees is weakened by reduced hours and 
significant, national shift away from classroom instruction.
    VBA is required to provide a significant amount of training on a 
weekly basis. However, the time is often not allotted fairly. For 
example, the St. Petersburg RO reported that often times, managers will 
use ``email training.'' The manager will email pages of reading 
material that states the amount of time expected to complete the 
training (i.e. 2.5 hours). However, management will inform employees 
that they will only approve a fraction of that time (e.g. 30 minutes 
for a 2.5 hour curriculum) for them to read and review the materials.
    As mentioned in Anchorage, AK, trainers are allowed a maximum of 20 
hours of credit per fiscal year to spend preparing for training. VBA 
constantly changes procedures due to changes in the law or new 
developments in allocating benefits. It is very difficult for trainers 
to adequately prepare without the proper preparation time to most 
effectively reach employees and explain new procedures.
Workplace Morale
    Almost across the board, workplace morale was described as 
continually declining and in certain cases, historically low. ROs 
described high turnover rates, high levels of stress, fear of 
retaliation, and concerns with their own abilities to lower the 
backlog. Employees were very concerned about the way they are portrayed 
publically due to the increasing publicity surrounding the backlog. The 
Los Angeles, CA RO stated: ``As long as the expectation is that the 
employees should perform miracles to decrease the backlog, morale will 
be low.''
    Arbitrary Performance Standards Lower Production and Accuracy
    With VBA's recent Transformation and upcoming national rollout of 
VBMS, VBA unveiled new performance standards. However, in offices 
currently using VBMS, the performance standards have been incredible 
difficult to achieve. One office reported that only 20% of their 
employees were able to achieve the new performance standards.
    Winston Salem, NC described that employees struggle to make 
unreasonable performance standards while sandwiched in between pressure 
from management and computer systems that too often fail.
    Many ROs report VBA's emphasis on production above all else. 
Despite recent claims that VBA is placing equal emphasis on quality, 
managers are provided many more incentives to increase production 
rather than quality. This creates a difficult atmosphere for employees 
and lowers morale.
    Despite the mandate of Public Law 110-389 and corroboration by IBM, 
VBMS has still not conducted a comprehensive, evidence-based, 
scientifically designed time motion study to determine how long certain 
tasks should take for employees to complete. VBA must develop and 
implement this time motion study with regular input from front line 
employees and their AFGE representatives before releasing performance 
standards for employees. When employees work under achievable 
performance standards, accuracy, production and morale will all 
increase.
Favoritism in the Promotion Process
    On the issues of employee opportunities for career growth, AFGE 
member feedback was mixed. ROs consistently reported a level of 
favoritism for certain employees who got along well with management as 
the leading candidates for promotions, rather than promotions being 
based off of performance. As mentioned before, management received 
strong incentives for increasing production. Employees also 
consistently reported that they did not know of opportunities for 
career growth or at the very least, the career path for promotion was 
not clearly outlined. Many ROs used the term ``good ol' boys' network'' 
to describe the opportunities available for possible promotions. The 
Winston Salem RO mentioned a glass ceiling in place for minorities and 
women.
Lack of Incentives for Internal Promotions
    Although RVSRs typically have more experience than VSRs, VSRs in 
two ROs (Huntington and Waco) reported that they had little incentive 
to try and move up to RVSR positions because they could currently make 
more as VSRs. This is because VBA does not accept ``time-in-grade'' 
when switching careers for timely promotion. For example, if you take 
an RVSR position in the middle of a grade, when your career ladder 
promotional date is due, VBA restarts it from the date you hired as an 
RVSR (rather than the time you spent working as a VSR).
High Turnover
    The VSR position experiences very high turnover rates. Highly 
skilled and trained VSRs are extremely valuable to the claims process 
and play an essential role in lowering any backlog. VSRs are currently 
capped at a GS-10 ($45,771-$59,505). Huntington, WV reports that in the 
past, there was a position for Senior VSRs (SVSRs), who still worked as 
VSRs but had more seniority and played a bigger role in the claims 
process. If VBA offered more SVSR positions, this would provide 
effective incentives for VSRs to both stay longer and work towards a 
higher performance level for promotion. VBA also loses VSRs to other 
federal agencies, such as Social Security, who offer higher grades to 
their experienced claims processors.
    Rewards for RO-Wide Achievement Should Be More Widely Distributed 
Throughout the RO
    Another consistent theme was that ROs tend to provide superior 
performance awards to certain employees while simultaneously excluding 
others who were also involved in the process. Often times, in order to 
reach a goal for an entire RO, the work must be exceptional from the 
Claims Assistants all the way up to the top line supervisors. If ROs 
could also receive incentives as a whole, morale could increase and 
lower wage employees could be recognized as a major part of the 
process.
Weak Management Incentives for Quality
    Management incentives are almost always based on production alone. 
The Milwaukee, WI RO reported that VACO sets production and quality 
targets for offices to qualify for these programs. Production is always 
more important since there are several different production categories 
that must be met in order for a station to qualify. VA leadership has 
outlined its desire to achieve 98% quality; however, VBA must improve 
incentives for management to focus on quality and not just on 
production levels.
Need Greater Opportunity for Front Line Employee Input into VMBS 
        Rollout
    General Hickey testified at a Senate VA Committee Hearing on March 
13, 2013 that employees in the twenty ROs currently using VBMS have the 
opportunity to provide feedback to her through weekly conference calls. 
While AFGE applauds General Hickey for stating her interest in hearing 
directly from front line employees and their AFGE representatives, this 
phone call still appears to be a work in progress, and does not include 
sufficient input or participation for others besides management. For 
example, when AFGE asked the Winston Salem RO to provide the names of 
the employees on the call, the only names mentioned were those of 
supervisors and managers. Although some front line employees are 
participating, General Hickey should encourage greater input from them 
by working more closely with AFGE leadership. Without the union 
present, many employees may be concerned about retaliation from 
management for any negative feedback related to VBMS. General Hickey 
has stated clearly that she would like to hear any negative feedback 
related to VBMS so that we can all continue to improve the system. With 
active, ongoing union involvement, this can accomplished.
    It is positive that in Winston Salem, with the consent of the 
Director, AFGE has appointed two stewards to be a part of these weekly 
calls and we encouraged both of them to engage in conversation about 
both the benefits and problems with VBMS.
    In terms of dealing directly with the union, General Hickey did 
commit to AFGE National VA Council President Alma Lee that she would be 
willing to participate in the monthly VBA phone call that the AFGE 
National VA Council conducts. This would also present a more meaningful 
and effective opportunity for General Hickey to hear from employees who 
have direct hands-on experience with VMBS and other Transformation 
changes.
    Thank you for the opportunity to share the views of AFGE and its 
National VA Council.

                                 
                          THE AMERICAN LEGION
    In 2010, when Secretary Eric Shinseki laid out the laudable goal of 
achieving 98% accuracy on veterans' disability claims with no claim 
pending over 125 days, the Veterans Benefits Administration (VBA) had 
509,423 claims pending with 39 percent of those claims pending over 125 
days. Just this week, on March 18, 2013, VBA's figures show 895,838 
claims pending, with a full 70.3 percent of those claims pending over 
the 125 day deadline. The Department of Veterans Affairs (VA) is moving 
backward, and veterans across America are deeply concerned.
    On behalf of National Commander James Koutz and the 2.4 million 
veterans of The American Legion, we would like to thank this Committee 
for the opportunity to address the critical issue of the claims backlog 
affecting veterans across the nation.
    The disability claims backlog affects millions of American 
veterans. The VA has been aggressively pursuing technological solutions 
to attack the backlog and deliver decisions in a timely manner through 
the Veterans Benefits Management System (VBMS). However, technological 
solutions will not be the sole key to reducing the backlog. The 
American Legion believes there are other important, transformative 
steps VA must take to fix the system. Three of the most important 
changes are:

    1. Fix a broken work credit system that currently gives the same 
credit for work whether or not it is performed correctly.
    2. Develop a system to aggregate common errors in processing and 
use this to create a training plan for employees.
    3. Hire more veterans to process claims to increase understanding 
of the military in those who are interpreting the claims files.
The Work Credit System:
    Under the current work credit system, a VA employee gets credit 
when a file moves off their desk on to the next station in the chain. 
Unfortunately, this system doesn't take into account whether or not the 
claim was processed correctly. Error rate continues to be a problem 
among VA claims adjudicators. When an error is made processing a claim, 
that claim must be appealed. The lengthy appeals process means a claim 
that should have been decided in a few months now will take years to be 
resolved for the veteran. This keeps the system clogged with work that 
could have been removed from the work flow if it had been done 
correctly the first time.
    Employees are only human. Pressure to move a claim off the desk is 
evident because raw volume is the standard VA uses to set productivity 
goals. To fix the system would not necessarily require a major 
overhaul. It could be as simple as giving credit for when a claim is 
finished, but also applying a negative credit or debit when it is 
determined work was done in error. If an office finishes 5,000 claims, 
but only at an 80 percent accuracy rate, then they would get credit for 
4,000 claims.
    This is a simple step which would help mold the operational climate 
in VA offices. The ability to work hard and accomplish a high work 
volume would still be prized; however the ability to work carefully and 
achieve high accuracy would then be equally prized. This incentive 
structure would help raise VA's accuracy rate to achieve Secretary 
Shinseki's goal of 98 percent accuracy.
Common Error Training:
    Another factor towards increasing accuracy is improving the quality 
of VA's training for claims adjudicators. Software and operating system 
solutions such as VBMS are important, but the vast amount of 
information VA possesses about veterans' claims should be harnessed for 
the purposes of training. With everything shifting to an entirely 
electronic operating environment, VA should have unprecedented ability 
to track common errors in their claims processing work.
    By aggregating common errors found by the Board of Veterans Appeals 
(BVA), the Court of Appeals for Veterans Claims (CAVC), and the 
internal Systemic Technical Accuracy Review (STAR) VA should be able to 
develop effective computer models of where their employees are making 
the most mistakes and adjust training accordingly. If the BVA is 
consistently finding that Regional Offices (ROs) are not applying 
DeLuca factors in rating skeletal-muscular disorders, then VA Central 
Office (VACO) should develop training modules for dissemination to 
correct the problem. Similarly, if the CAVC finds a consistent pattern 
of failure to apply proper evidence standards for Posttraumatic Stress 
Disorder (PTSD) cases involving combat zones, refresher material can be 
developed and delivered to the ROs to get everyone back on track.
    As VA moves towards such a powerful electronic model for the office 
environment, they must utilize those tools to be a support to their 
employees' decision making skills. Training is already inconsistent 
from RO to RO, and developing a centralized plan based on real time 
data about where VA can best use their training resources.
Hiring Veterans:
    At any given time, less than one percent of the population is 
serving in the military. Far fewer people in the population at large 
truly understand the sacrifices and day to day realities of military 
service. The average person on the street doesn't know the difference 
between a Battalion and a Battery, or even that a Battery in a military 
context can mean a Company of Artillery soldiers and not the thing that 
powers your Smart Phone.
    In terms of the claims backlog, military experience is a plus for 
claims adjudicators because it enables easy familiarity with the 
military records in the claims files. Veterans don't have to spend 
extensive time looking up the myriad military acronyms, they just know 
that the initials CIB mean a service member has seen combat and thus 
the provisions of 38 USC Sec.  1154b apply to their claim.
    Veterans have seen unemployment rates two thirds higher than their 
civilian counterparts in past years. Boosting the number of veteran 
employees at VBA would serve a dual purpose. It would both increase the 
institutional knowledge within VBA of the military, and it would reduce 
veteran unemployment. To this end, greater work can be done through 
vocational rehabilitation programs to encourage veterans to work for 
VBA and to ensure they have the skills necessary to be successful 
there.
Conclusion:
    These three simple steps are by no means an exhaustive solution to 
taming the claims backlog. However, they do represent three simple 
actions, with a specific scope, which can improve the operational 
environment and help VA achieve their goals of accuracy and timeliness. 
Nobody, not VA, not Congress, and certainly not the veterans' 
community, is satisfied with the current state of the claims system. It 
will take work to reduce the claims backlog, but not all of the work 
needs to be overly complicated. The American Legion believes that with 
a couple of simple initiatives, VA could move forward with their 
transformation and help the human side of their offices as their tech 
people work diligently on the electronic side of the process.
    The American Legion again thanks the Committee for its diligent 
attention to the claims process. For additional information regarding 
this testimony, please contact Mr. Ian de Planque at The American 
Legion's Legislative Division, (202) 861-2700 or [email protected]

                                 
                IRAQ AND AFGHANISTAN VETERANS OF AMERICA
    Statement of Tom Tarantino
    Chief Policy Officer, Iraq and Afghanistan Veterans of America

    Chairman Miller, Ranking Member Michaud, and Distinguished Members 
of the Committee:
    Iraq and Afghanistan Veterans of America (IAVA) would like to thank 
you for holding this hearing today on this critically important topic, 
and for your continued dedication to improving the functioning and 
capabilities of the Department of Veterans Affairs (VA) through 
oversight. We also appreciate this opportunity to share our views on 
finally ending the VA claims backlog.
    IAVA is the country's first and largest nonprofit, nonpartisan 
organization for veterans of the wars in Iraq and Afghanistan and their 
supporters nationwide. Founded in 2004, our mission is to improve the 
lives of these veterans and their families. With over 200,000 members 
and supporters, we strive to create a country which honors and supports 
veterans of all generations.
    My name is Tom Tarantino and I am the Chief Policy Officer for 
IAVA. I proudly served 10 years in the Army, beginning my career as an 
enlisted Reservist, and leaving service as an Active-Duty Cavalry 
Officer. Throughout those 10 years, my single most important duty was 
to take care of other soldiers. In the military, they teach us to have 
each other's backs, both on and off the field of battle. And although 
my uniform is now a suit and tie, I am proud to work with this Congress 
to continue to have the backs of America's service members and 
veterans.
    The VA claims backlog has frustrated veterans across the country 
since IAVA's inception. After a decade at war, more than half a million 
veterans are stuck in the VA disability claims backlog. According to 
the VA's own estimates, 70 percent of claims are backlogged by more 
than 125 days. The VA has reported that the average wait time was 273 
days. But if it's your first claim, like it is for most Iraq and 
Afghanistan veterans, it's actually 316 to 327 days. Regionally, the 
problem is worse. Veterans returning from Iraq and Afghanistan who live 
in major metropolitan areas wait up to twice as long - 642 days in New 
York, 619 days in Los Angeles, and 542 days in Chicago.
    Disability benefits are designed to fill the gaps in loss of 
earnings potential that are caused by injuries sustained during 
military service. Long wait times have a devastating impact on veterans 
and their families who are trying to successfully transition to 
civilian life. After 10 years of war and billions of dollars spent, 
veterans are still languishing in a VA disability system that was 
obsolete before most veterans of Iraq and Afghanistan veterans were 
born. For our brothers and sisters from previous conflicts, this fight 
has gone on for decades.
    Alone, these numbers would be shocking, but what makes them tragic 
is that they represent the stories of real people.
    Take the case of Zack McIlwain. Zach is an Army veteran who served 
two combat tours in Iraq. He has been waiting nearly three years (973 
days) to get all of his disability benefits. Zach tried to be proactive 
and filed his initial claim nearly a year before leaving the Army, but 
he heard nearly nothing for 18 months. In that time, a service related 
injury required surgery at the VA that lead to an infection that 
permanently damaged his left hand. This was added to his claim. When 
the VA finally ruled, it rated on all but his permanently damaged hand. 
Although service connected, the VA said that it lost the paperwork that 
related to his surgery, and he would have to appeal and send any new 
evidence later. That was a year ago. Zach has the paperwork that the VA 
lost and is ready to send it in but has heard nothing from the VA.
    And then there is the case of Charles Gardner, a Navy Corpsman 
whose first day at Hospital Corpsman School was September 11, 2001. 
After six years of honorable service, including a deployment to Iraq 
from 2004-2005 with the 5th Marine Regiment, Charles began filing his 
VA disability claim toward the end of his term of service. After 
receiving conflicting information that initially delayed the filing of 
his claim, Charles eventually managed to file the claim correctly. But 
since doing so, Charles has been waiting for more than three years for 
a decision on his initial submission.
    And finally, the story of John Wypyszinski. After serving for 
sixteen years in both the Army and the Navy, John filed a disability 
claim with the VA only to have his first claim lost. From 2007 through 
2009, John pushed and waited for his claim to be completed with no 
results. Finally fed up, John retained an attorney and notified local 
media about his problem. In the end, the VA regional office that had 
been so slow to make progress on John's file for all those years 
somehow managed to process his claim and get him his rating within days 
of being contacted by a local news affiliate.
    These stories are just a few of the nearly half a million voices of 
the VA claims backlog. This week IAVA is brining veterans from around 
the country to Storm the Hill to call for an end to the VA claims 
backlog. Although the VA is in the process of modernizing the claims 
system, the backlog continues to grow with no end in sight. Although 
well intentioned, it is clear that the VA can't solve this problem on 
its own. We must utilize all the resources and ingenuity that America 
has to offer to break the claims backlog and keep the promise we made 
to the millions of veterans who have sacrificed to defend our nation.
    The time to act is now. IAVA is calling on President Obama to 
establish a presidential commission to end the claims backlog. We are 
asking the members of the committee to join us in this call while also 
continuing to investigate the causes of the backlog and to hold the 
VA's leadership accountable. Veterans did not hesitate or delay in 
answering the call to serve their country. Now that they have returned, 
we owe it to them to answer their call to end the backlog.
    Thank you for the opportunity to offer the views of our membership 
on this topic of critical importance, and we look forward to continuing 
to work with you and with the VA to improve the lives of Iraq and 
Afghanistan veterans and their families. Thank you for your time and 
attention.

                                 
              NATIONAL ORGANIZATION OF VETERANS' ADVOCATES
    Prepared Statement
    Michael R. Viterna, President of NOVA

    Contact Information:
    National Organization of Veterans' Advocates, Inc.
    1425 K Street, NW, Suite 350
    Washington, DC 20005
    (202) 587-5708
    www.VetAdvocates.org

    The National Organization of Veterans' Advocates, Inc. (NOVA) 
thanks Committee Chairman Miller and Ranking Member Michaud for the 
opportunity to testify about the disability claims process at the 
Department of Veterans Affairs (VA). NOVA is honored to share our views 
for this hearing, ``Focusing on People: A Review of VA's Plans for 
Employee Training, Accountability, and Workload Management to Improve 
Disability Claims Processing.''
    NOVA is a not for profit 501(c)(6) educational membership 
organization incorporated in the District of Columbia in 1993. NOVA 
represents nearly 500 attorneys and agents assisting tens of thousands 
of our nation's military Veterans, their widows, and their families 
obtain benefits from VA. NOVA members represent Veterans before all 
levels of VA's disability claim process. This includes the Veterans 
Benefits Administration (VBA), the Board of Veterans' Appeals (BVA or 
Board), the U.S. Court of Appeals for Veterans Claims (Veterans Court 
or CAVC), and the U.S. Court of Appeals for the Federal Circuit 
(Federal Circuit). In 2000, the CAVC recognized NOVA's work on behalf 
of Veterans when the CAVC awarded the Hart T. Mankin Distinguished 
Service Award.
    On April 18, 2012, NOVA testified before this committee and 
addressed several issues:

    1. The need for Access to Veterans Electronic Records by Private 
Practitioners
    2. Entering Information Sent to VA in a Correct and Timely Manner
    3. Improving Access to VBA Points of Contact for Private 
Practitioners
    4. Decreasing Blocked Calls and Incorrect Information Given by VA

    These issues all relate to VA's workload management and attention 
thereto will improve disability claims processing by allowing VA to 
dedicate employee resources to disability claims processing rather than 
responding to status inquiries and record copy requests and will help 
assure accuracy of incoming and outgoing information. Yet, a year after 
its testimony, NOVA can report no meaningful progress in any of these 
areas despite repeated attempts to work with Agency personnel through a 
variety of channels. NOVA would like to summarize and clarify its 
observations and concerns in these areas as relates to accredited 
attorneys and agents and the Veterans they represent.
    1. Access to Veterans Electronic Records (VBMS)
    On two occasions last year, NOVA formally raised its concerns to 
Congress relating to the need for timely, accurate, and complete access 
to a VA claimant's file by a Veteran's authorized representative. This 
is absolutely vital in order to protect the rights of our Veterans and, 
without question, will positively contribute to the improvement of 
claims processing.
    Congress has proscribed that ``[a]ll files, records, reports, and 
other papers and documents pertaining to any claim under any of the 
laws administered by the Secretary . . . shall be confidential and 
privileged, and no disclosure thereof shall be made except as provided 
in this section.'' See 38 U.S.C. Sec.  5701(a). The statute mandates 
thereafter that the Secretary ``shall make disclosure'' of these 
protected VA records to ``a claimant or duly authorized agent or 
representative of a claimant as to matters concerning the claimant'' 
when such disclosure would not be injurious to the claimant. See 38 
U.S.C. Sec.  5701(b).
    The information and evidence that serves the basis of a Veteran's 
claim comprises the VA claims file as we know it today. For the vast 
majority of our Veterans, this file is in paper format and, as such, is 
perhaps the single impediment to accurate and timely VA claim 
processing.
    Access by a claimant to his or her VA case file heretofore has been 
possible only by visiting the VA Regional Office (VARO) by appointment 
to review the file or by requesting a paper copy of that file. In our 
experience, neither process is effective. Request for paper copies 
result in response delays of many months, with 6 to 12 months or more 
being common. The records are copied individually and by hand and the 
result is less than optimal. Forms are copied in no order whatsoever, 
are provided out of sequence with other, nonrelated documents 
intermingled within another's pages, are often upside down, with 
backside information lacking, or are illegible due to poor copying 
techniques or VARO overprinting of facility identification markings. 
Worse, portions of the record are frequently missing and, in many 
cases, contain confidential and privileged records from other VA 
claimants unrelated to the case at hand. Accordingly, the information 
provided is less than optimal for assisting the representative in the 
claims development, adjudication and appeals processes.
    The Veterans Benefit Administration (VBA) claims file is still in 
paper format for nearly all Veterans. Health records, created and 
maintained by the Veterans Health Administration (VHA), to the 
contrary, are presently and have been in electronic format for some 
time. The paper claims file is a dinosaur that is at the heart of VA's 
inability to improve disability claim processing. Its very existence 
results in manpower, copier and postage expenses that are entirely 
unwarranted in today's technologically advanced society. Worse, a paper 
system invites inaccurate information through misfiling, impedes a 
Veteran's ability to obtain timely information regarding his or her 
claim so he or she can assist in the claims development process, and 
represents a misuse of limited VA resources. Other government agencies, 
like the Social Security Administration (SSA), have long-ago recognized 
the inherent difficulties and expenses of a paper based system and have 
effectively transitioned to a secure, on-line electronic format, 
entitled ``Appointed Representative Suite of Services'' (ARSS).
    VBA's e-Benefits system, also known as the Veterans Benefits 
Management System (VBMS), was to address the deficiencies noted above 
but the progress from NOVA's perspective has been dismal, with no 
viable solution in sight. This is the top complaint of NOVA members who 
work with Veterans every day. The lack of access undermines our 
Veterans' due process and property rights but also directly contributes 
to the delays in claims processing.
    VA has provided electronic access to Veteran Service Organizations 
(VSOs) but has yet to even define what files will be accessible or what 
steps must be taken to grant this same access to private attorneys and 
agents despite the clear advantages for it to do so. For instance, VHA 
record access has yet to be defined, much less assured. Yet, NOVA has 
been advised that HVAC committee staff were recently given a briefing 
by VA officials where they were told that private attorneys and agents 
presently have access. This is not true. What is true is VA has not 
determined how access will be provided and what information is to be 
included. NOVA has been informed that security training will be 
required but that remains to be undefined further. NOVA has also been 
told that everyone will be required to have PIV cards and must purchase 
card readers to enable private access, after undergoing fingerprinting 
and security background checks. Apparently, VA's assertions of modeling 
VBMS after the ARSS system successfully used by SSA are not to be taken 
seriously. Rather, it has chosen to utilize its limited resources in 
needlessly developing a complicated process for access that only helps 
prolong the processing of VA claims.
    2. Timely Entry by VA of Veteran Claim Information
    It has been the experience of NOVA's members that there are 
substantial time delays between receipt of a claim inquiry, or the 
submission of evidence, and when it is available to VA claim decision 
makers. Besides the usual delays associated with receiving and 
processing the mail, an additional delay is incurred because VA must 
then determine if it can respond to the inquiry or accept the evidence 
provided. If the inquiry or evidence submitted is not from the VA 
claimant, then VA must validate that the information was obtained from 
the Veteran's authorized representative. The Veteran conveys his/her 
authorization by appointing a representative through submission of a VA 
Form 21-22a. Yet, this appointment is meaningless unless and until VA 
has taken the effort to enter that information into its system. Such 
entry in most cases takes several months and much longer many times. 
NOVA has been informed that these forms are not being submitted timely 
because no specific VA employee has been directed to assume this 
responsibility and no work credit is given for this process. 
Consequently, the form is submitted by whomever, whenever it can be 
worked in and additional work effort is required either returning the 
materials submitted or in making further inquiry to verify that the 
representative has been properly appointed.
    Access to a fully functional on-line system, as that employed by 
SSA, would permit the electronic submission of correspondence and 
evidence directly to the file without the delays inherent with a paper 
driven system. This process would help assure that information is filed 
in the correct Veteran's file. Moreover, it would eliminate the need 
for VA to manually receive and process the appointment of a 
representative. Such access represents considerable time savings to VA, 
allowing them to devote resources instead to claims development and 
processing.
    3. Access to VBA Points of Contacts
    Private representatives have no meaningful access to VBA contacts. 
Last year we noted that Attorney Fee Coordinators (AFC) at VBA Regional 
Offices may serve as liaisons with attorneys and agents, many of whom 
are NOVA members. In most cases, AFCs are cooperative and helpful to 
NOVA members, providing prompt and accurate status updates on Veterans' 
claims; but in many cases, like the Detroit VARO, the AFC has been 
instructed to restrict assistance to fee related issues only. Instead, 
the private representative must waste additional time by submitting 
written inquires that take weeks or months, if ever, for a vague 
response as to claim or appeal status. Alternatively, a representative 
may call the VA ``800'' system but those contacts, without exception, 
provide even less specific information and afford no guidance on what 
may be needed to move a claim forward. This is also true for telephonic 
contact to the Board of Veterans' Appeals. More promising, but no more 
effective, is an electronic inquiry though VA's Inquiry Routing & 
Information System (IRIS), which provides email and telephonic 
responses to a Veteran's representative. Again, the responses are 
extremely vague and most often result in a simple recitation of the 
adjudication history i.e., date of claim, notice of disagreement, 
substantive appeal filing, etc. Too often the response is denied 
because a power of attorney appointing the Veteran's representative has 
not been electronically recorded, despite the fact the form had been 
filed months earlier. Typically, the response is too vague to be of 
value i.e., awaiting a decision, awaiting a medical examination, 
awaiting Decision Review Officer Review, etc.
    Access to a fully functional on-line system, as that employed by 
SSA, would permit timely access to information about a Veteran's claim, 
such that evidentiary deficiencies or responses could be addressed by 
the claimant without delay. Moreover, such access represents 
considerable time savings to VA, allowing them to devote resources 
instead to claims development and processing.
    4. Decreasing Blocked Calls and Incorrect Information Given by VA
    As with the preceding issues, on-line access to Veteran file 
information will provide accurate, real time information that will 
obviate the need for telephone inquiries which will, in turn, allow VA 
to dedicate resources to claims development and processing.
    In summary, VA's timely transition to a fully electronic claims 
files system that assures full access to all stakeholders, Veterans and 
representatives alike, is the single most important factor in improving 
claims processing. VBMS, when and if fully implemented, will allow VA 
to allocate resources in a meaningful manner and reduce the challenges 
of an overburdened disability claims processing system.
    In conclusion, the matters we testified about in April 2012 still 
continue a year later, with little or no progress. NOVA has met with VA 
officials on numerous occasions to try to resolve these and other 
issues with limited success. The training of individuals within VA 
needs to address these and other similar issues that will aid Veterans 
in obtaining their rightful benefits. A cultural change is necessary 
within VA.
    As always, NOVA stands ready to assist the Committee or VA in 
whatever way possible to further improve and enhance the systemic 
issues that negatively affect the lives of our Veterans and their 
families.
    We thank you for this opportunity to provide our testimony.

                                 
                     PARALYZED VETERANS OF AMERICA
    Chairman Miller, Ranking Member Michaud, and members of the 
Committee, Paralyzed Veterans of America (PVA) appreciates the 
opportunity to submit a statement for the record concerning the 
Department of Veterans Affairs' (VA) performance with processing 
claims. We are particularly pleased to see the focus you have placed on 
VA's plans for employee training, accountability, and workload 
management to improve disability claims processing. This issue deserves 
a great deal of oversight as the number of veterans waiting on ratings 
decisions continues to grow.
    Historically the Veterans Benefits Administration (VBA) was funded 
based on workload demands and staffing budgets were predicated based on 
the perceived need to provide quality service to veterans. The number 
of authorized Full-Time Equivalent Employees (FTEE) was based on 
anticipated workload and could also include additional services that 
were deemed to be of value to veterans. The allocation of resources, as 
funded by Congress, was based on the need to provide adequate and 
timely services. As this paradigm shifted to a more capricious 
budgetary process which formulated FTEE requirements based on available 
funding rather than workload demands, the dynamics of claims processing 
became inextricably intertwined with issues unrelated to the quality of 
service.
    The clamor that then accompanied the steadily increasing backlog in 
the number of claims quickly garnered the attention of Congress, and 
the previously esoteric internal affairs of the VA quickly became the 
object of external review. As the pressure on VA increased to reduce 
the backlog of pending claims, employees were strongly encouraged to 
maximize their productivity. The short term dividends achieved in part 
by reduced training time were followed by long term losses fostered by 
lack of expertise. As the error rate climbed, a new clamor loomed; this 
time to improve quality. By this point the VA was forced to defend a 
situation that it did not have sole responsibility in creating. Every 
oversight hearing conducted by Congress or other government agencies 
has basically centered on finding fault, as if success could be equated 
with determining why something failed. This then fostered a culture in 
VA of ``it's OK if something failed, as long as it's not my fault.''
    The VA felt increasing pressure from Congress to demonstrate 
improvements in the overall accuracy of claims processing. This 
pressure elicited responses from VA top leadership from the Secretary 
on down. The cry from veterans' service organizations merely echoed the 
universal agreement that change was essential. While no one disagreed 
on the requirement for accuracy, there were other components that 
entered into the equation.
    We live in a highly sophisticated world of technology where 
ubiquitous sources of statistical data lead us to conclusions that are 
not always reinforced by logic. Errors are often evaluated by the scale 
on which they deviate from the established process. While the 
traditional process can have great value, it cannot summarily dismiss 
the value of applied logic and common sense. VA employees who know 
their jobs well should not live in fear of being punished for 
exercising judgment in the processing of VA claims. The adjudication of 
VA claims must not be limited by the application of algorithmic 
technolologies. If this were the case, we would not need a Board of 
Veterans' Appeals or the Court of Appeals for Veterans Claims.
    While the Department of Veterans' Affairs has made great progress 
in streamlining their overall system of claims processing, they have 
overemphasized the role of technology and have underestimated the 
capacity of individual innovation. Technology is a tool that offers 
great advantage to a competent work force. It is not a substitute for 
qualified employees. While VA is paving the way for the future with 
their implementation of the Veterans Benefits Management System (VBMS), 
they are missing the opportunity to empower their people by fostering 
and recognizing creativity.
    We have to ask how VA Regional Offices like Baltimore and Oakland 
were allowed to get to the point where any semblance of quality 
workmanship was difficult to recognize? Could it be that people in 
these geographic areas are less qualified? While this question is 
obviously rhetorical, it does lend credence to the probability that the 
likely root cause of the problem can be traced to poor management.
    First line supervisors are responsible to evaluate those working 
under their direction and to take whatever corrective action is deemed 
necessary to achieve an acceptable level of employee performance. This 
responsibility continues up the supervisory chain and ultimately rests 
with the Director of a Regional Office. All employees are challenged to 
do the best they can with the resources that are available to them. 
When forced to work in an environment that is far from ideal, 
innovation and empowerment become more important than ever.
    We would offer an example of a situation PVA is currently facing. 
PVA is handling the claim of a veteran for amyotrophic lateral 
sclerosis (ALS) where the veteran had deteriorated rapidly and was 
rated as R-2, which is the highest possible VA rating. The rating was 
completed in January and as of this writing, has not been promulgated. 
After numerous inquiries, PVA's Benefits staff was told that since the 
retroactive payment was in excess of $25,000, a third signature was 
required, and that there was no one in the office that week that could 
authorize this payment. While this determination was made by a very 
senior level employee who was ``following the rules,'' we would argue 
that the delay was needless. The obvious purpose of the $25,000 rule is 
to prevent costly errors that could easily occur in large retroactive 
benefits payments. In this case, however, the veteran's R-2 rating 
resulted in a $5,000 monthly increase for the previous six month 
period. Simple math shows that the veteran should receive $30,000 as a 
retroactive payment. There really isn't any potential vulnerability in 
this instance and the high level supervisor in question could have 
considered the intent of the audit procedure and assumed the risk of 
taking an appropriate action under the circumstances.
    Generally speaking, procedures are set in place for a reason, but 
the application of common sense must somehow be facilitated. Employees 
must be trained and empowered to follow the intent of established 
practices. The Hippocratic Oath, ``Do no harm,'' should be valued as 
much by VBA as it is by VHA. Quality cannot be determined by an overlay 
approach of the process
    The bottom line is that VA was forced to react to mounting 
criticism of poor quality and they ultimately relied too heavily on the 
rules rather than on results. The only resolution that we see to this 
issue is a more objective measure of quality that focuses on results 
more than procedural issues. VA employees should be recognized for 
creativity and innovation on how they comply with the intent of the 
law. Quality reviews should include a focus on claims processing which 
objectively evaluates how a claim was processed from start to finish as 
opposed to reliance only on incremental reviews of each of the multiple 
components of the process.
    Paralyzed Veterans of America appreciates the Committee's continued 
concern with the massive problem that the VA faces in getting claims 
decisions done in a timely manner while ensuring that they are done 
right the first time. With the Committee's diligent oversight and the 
VA's willingness to change, we believe VBA can achieve Secretary 
Shinseki's goal of eliminating the claims backlog.
    Thank you again for the opportunity to submit a statement for the 
record. We would be happy to take any questions.
Information Required by Rule XI 2(g)(4) of the House of Representatives
    Pursuant to Rule XI 2(g)(4) of the House of Representatives, the 
following information is provided regarding federal grants and 
contracts.
                            Fiscal Year 2013
    No federal grants or contracts received.
                            Fiscal Year 2012
    No federal grants or contracts received.
                            Fiscal Year 2011
    Court of Appeals for Veterans Claims, administered by the Legal 
Services Corporation--National Veterans Legal Services Program-- 
$262,787.

                                 
                        Questions For The Record

                 HVAC Majority Members Questions to VBA
    Chairman Miller: Of VBA's approximate 20,000 positions, how many 
employees were fired in the year 2012?
    Mr. Huelskamp: Provide the list of bonuses (amount, recipient, 
region) awarded to regional managers over the past 5 years. (VBA noted 
that this would be provided for years up to and including 2011, as the 
bonuses for 2012 have not yet been finalized)
    Mr. Huelskamp: We heard from GAO that in certain parts of the 
agency there is data falsification occurring. How many employees have 
been penalized or punished for falsifying data in the last three to 
four years?
    Mr. Huelskamp: Provide budget information as to how money is spent 
on VA conferences and those types of events.
    Chairman Miller: Review a situation that was presented to us from 
the Jackson, MS RO, regarding an 11 year old remanded claim that was 
reported to be sitting with RO; please respond. Under Secretary Hickey 
requested the name and contact information, which is veteran Richard C. 
Lancaster, C-File # 28150889.
    Chairman Miller: Has VA received any reports from employees that 
any management has advised or ordered employees to process certain 
claims first to inflate the RO numbers? Has VA received any reports 
from employees that any management has advised or ordered employees to 
``accidentally'' clear old claims for station credit and then 
reestablish the claims under a 930 end product, which is not tracked by 
central office?
    Mr. Coffman: In accordance with the VBA's goals, we have heard 
VBA's target for 2015 but in terms of interim goals, provide the 
specific number as to what you project the backlog to be at in a year 
(as of early of 2014).
    Mr. Bilirakis: Specific to the St. Pete RO, please specifically 
provide information as to how VA will address St. Pete RO's stated need 
for $2.5 million in overtime funds for FY 2013. Will $2.5M be provided 
to the St. Pete RO for overtime?
    Chairman Miller: In e-Benefits, how soon after uploading documents, 
such as medical records, will the system reflect that the materials/
information was received?
    Chairman Miller: Noting a 2015 laudable paperless goal, we received 
testimony a few weeks ago regarding the individual electronic health 
record and it now appears that DoD and Va are going on divergent paths. 
If Dod and VA do not cooperate on creating the single record, how is 
that going to impact the ability to adjudicate claims?
         Responses From VBA to HVAC Majority Members Questions
    Chairman Miller: Of VBA's approximate 20,000 positions, how many 
employees were fired in the year 2012?
    Response: For this question, VBA defined ``fired'' as any VBA 
initiated termination actions on employees based on performance, 
conduct, delinquency (attendance/dereliction of duty/refusing 
reassignment), removal during probationary period, and/or failure to 
meet suitability requirements. Please see the chart below for the 
requested data.


----------------------------------------------------------------------------------------------------------------
                           Fiscal Year                                        VBA Employees ``fired''
----------------------------------------------------------------------------------------------------------------
2000............................................................                                             74
----------------------------------------------------------------------------------------------------------------
2001............................................................                                            105
----------------------------------------------------------------------------------------------------------------
2002............................................................                                            152
----------------------------------------------------------------------------------------------------------------
2003............................................................                                             61
----------------------------------------------------------------------------------------------------------------
2004............................................................                                             68
----------------------------------------------------------------------------------------------------------------
2005............................................................                                             43
----------------------------------------------------------------------------------------------------------------
2006............................................................                                             90
----------------------------------------------------------------------------------------------------------------
2007............................................................                                            128
----------------------------------------------------------------------------------------------------------------
2008............................................................                                            152
----------------------------------------------------------------------------------------------------------------
2009............................................................                                            180
----------------------------------------------------------------------------------------------------------------
2010............................................................                                            283
----------------------------------------------------------------------------------------------------------------
2011............................................................                                            138
----------------------------------------------------------------------------------------------------------------
2012............................................................                                            126
----------------------------------------------------------------------------------------------------------------
2013 (through Feb 28)...........................................                                             37
----------------------------------------------------------------------------------------------------------------

    Mr. Huelskamp: Provide the list of bonuses (amount, recipient, 
region) awarded to regional managers over the past 5 years. (VBA noted 
that this would be provided for years up to and including 2011, as the 
bonuses for 2012 have not yet been finalized)
    Response: The 56 regional offices are separated into four areas, 
and each Area Director is responsible for oversight for his/her 
respective regional office. Information on bonuses for Area and 
Regional Office Directors is attached.
    Mr. Huelskamp: We heard from GAO that in certain parts of the 
agency there is data falsification occurring. How many employees have 
been penalized or punished for falsifying data in the last three to 
four years?
    Response: Yes, please see the chart below for the number of VBA 
employees disciplined each fiscal year for falsifying data. These 
counts include a variety of falsified data, ranging from information 
related to attendance/leave to data for production.


----------------------------------------------------------------------------------------------------------------
                               FY                                              Employees Disciplined
----------------------------------------------------------------------------------------------------------------
2010............................................................                                             13
----------------------------------------------------------------------------------------------------------------
2011............................................................                                             30
----------------------------------------------------------------------------------------------------------------
2012............................................................                                             55
----------------------------------------------------------------------------------------------------------------
FYTD 2013.......................................................                                             15
----------------------------------------------------------------------------------------------------------------

    Mr. Huelskamp: Provide budget information as to how money is spent 
on VA conferences and those types of events.
    Response: Please see the attached report for VBA's conference 
spending in the first quarter of FY 2013.
    Chairman Miller: Review a situation that was presented to us from 
the Jackson, MS RO, regarding an 11 year old remanded claim that was 
reported to be sitting with RO; please respond. Under Secretary Hickey 
requested the name and contact information, which is veteran Richard C. 
Lancaster, C-File # 28150889.
    Response: Pending with VBA
    Chairman Miller: Has VA received any reports from employees that 
any management has advised or ordered employees to process certain 
claims first to inflate the RO numbers? Has VA received any reports 
from employees that any management has advised or ordered employees to 
``accidentally'' clear old claims for station credit and then 
reestablish the claims under a 930 end product, which is not tracked by 
central office?
    Response: VA takes data integrity very seriously. Any reports from 
employees or stakeholders which imply that a regional office may be 
falsifying data are investigated immediately. Certain claims can be 
expedited based on various factors, to include if the Veteran is 
homeless, terminally ill, or facing financial hardship. The 930 end 
product is used to review cases that may require correction or 
referral. This end product is tracked at both the Central Office and 
regional office level.
    Mr. Coffman: In accordance with the VBA's goals, we have heard 
VBA's target for 2015 but in terms of interim goals, provide the 
specific number as to what you project the backlog to be at in a year 
(as of early of 2014).
    Response: Pending with VBA.
    Mr. Bilirakis: Specific to the St. Pete RO, please specifically 
provide information as to how VA will address St. Pete RO's stated need 
for $2.5 million in overtime funds for FY 2013. Will $2.5M be provided 
to the St. Pete RO for overtime?
    Response: The Office of Field Operations distributes overtime 
funding allocations quarterly, based on RO performance, staffing, 
individual missions and workload levels. While overtime funding is 
constrained by the overall funding level in the VBA budget, every 
effort is made to fund individual ROs at a level that is sufficient to 
support their accomplishment of the National mission. Fiscal year to 
date, the St. Petersburg RO has spent approximately $868,000 on 
overtime and will receive $450,000 to start Quarter 3. RO balances are 
regularly monitored during the quarter, and individual RO requests are 
evaluated and funded on a case-by-case basis, as funding allows.
    Chairman Miller: In e-Benefits, how soon after uploading documents, 
such as medical records, will the system reflect that the materials/
information was received?
    Response: When a user uploads documents into eBenefits, they are 
immediately available to field personnel for access within the Veterans 
Benefits Management System, and the system will reflect a new mail 
indicator.
    Chairman Miller: Noting a 2015 laudable paperless goal, we received 
testimony a few weeks ago regarding the individual electronic health 
record and it now appears that DoD and VA are going on divergent paths. 
If DoD and VA do not cooperate on creating the single record, how is 
that going to impact the ability to adjudicate claims?
    Response: The Department of Veteran Affairs (VA) and the Department 
of Defense (DoD) are not moving away from a joint, integrated 
electronic health record. This is still the plan and while the strategy 
used to accomplish this goal has changed, the end goal remains the 
same.
           HVAC Minority Members Letter and Questions to VBA
 Letter and Questions from Rep. Michael H. Michaud, Ranking Democratic 
                                 Member
    April 3, 2013

    The Honorable Eric K. Shinseki
    Secretary
    U.S. Department of Veterans Affairs
    810 Vermont Avenue, NW
    Washington, DC 20420

    Dear Mr. Secretary:

    In reference to our Full Committee hearing entitled, ``Focusing on 
People: A Review of VA's Plans for Employee Training, Accountability, 
and Workload Management to Improve Disability Claims Processing'' that 
took place on March 20, 2013, I would appreciate it if you could answer 
the enclosed hearing questions by the close of business on April 30, 
2013.
    In an effort to reduce printing costs, the Committee on Veterans' 
Affairs, in cooperation with the Joint Committee on Printing, is 
implementing some formatting changes for materials for all Full 
Committee and Subcommittee hearings. Therefore, it would be appreciated 
if you could provide your answers consecutively and single-spaced. In 
addition, please restate the question in its entirety before the 
answer.
    Due to the delay in receiving mail, please provide your response to 
Jian Zapata at [email protected] If you have any questions, 
please call (202) 225-9756.

    Sincerely,

    Michael H. Michaud
    Ranking Democratic Member

    MHM:jb

People Questions
    1. Are there certain types of medical conditions that could 
possibly be automated in VBMS for immediate verification and payment? 
Please provide the specific medical conditions if so.
    2. In the hearing, it was suggested that the productivity of VBA 
employees had gone down over time. Does VBA believe this to be 
accurate?
    3. Does VBA believe that the complexity of an individual claim has 
gone up and therefore the time required to adjudicate an individual 
claim has gone up?
    4. Could training be better focused if individual VARO's focused on 
specific medical conditions versus all medical conditions that a 
veteran might apply for?
    5. AFGE has provided us with training recommendations in their 
Statement for the Record. They raise some important points, such as:

    a. How much training is provided to new employees prior to allowing 
them to process cases?
    b. In addition to the Change Management Agents that have been 
placed at each RO, how is employee input and other feedback included to 
improve current training or to develop new training programs?
    c. How often are live cases used in trainings?

    6. AFGE's statement also suggests implementing a time motion study 
to better determine appropriate performance standards. Has VA explored 
conducting such a study?
    7. AFGE points out that management incentives are largely based on 
quantity of production. How are incentives calculated to also take into 
account quality of production?
    8. The Committee was informed that the VBA does not have a unified 
system for aggregating and analyzing the results of both the coach 
reviews and the STAR reviews.

    a. What has been done to strengthen the Systematic Technical 
Accuracy Review (STAR) program and to create a more unified review 
system that ensures proper follow-up, remediation, and training?

    9. Have there been any updates or improvements to the work credit 
system to also focus on accuracy?
    10. In consideration of moving into a new processing system, when 
does VBA plan to reconsider the work-credit system?
Process Questions
    1. Does it make sense for VA, in a paperless processing system, to 
have high performing stations specialize and focus on the difficult 
claim types?
    2. Does VBA believe that focusing on a ``claim'' is an effective 
way to evaluate their workload? Is there a more accurate way to 
estimate the actual workload and to distribute and specialize it?
    3. What proportion of all claims in the past fiscal year had a 
medical condition that was paid in advance of the complete adjudication 
of the claim?

    a. What proportion of claims at the Togus VARO, in the past fiscal 
year, had a medical condition that was paid in advance of the complete 
adjudication of the claim?
    b. What proportion of claims at the Los Angeles VARO, in the past 
fiscal year, had a medical condition that was paid in advance of the 
complete adjudication of the claim?

    4. What factors inhibit a ``pay as you go'' process in a paper 
based adjudication model?

    a. Will all of these concerns be eliminated in a paperless 
processing system?
    b. How will VBA be better situated to pay medical conditions as 
they are completed?

    5. Under the Fully Developed Claims program (FDC) program:

    a. How many are new claims vs. an increase in ratings?
    b. Currently, claimants are unable to go use the FDC process if 
they have other claims pending adjudication that aren't in the FDC 
program. Has VA explored changing this?
    c. What sort of incentives is VA exploring for VSO, State, and 
County partners to increase FDC submissions?
    d. Is there any way that VSO's can assist in providing all of the 
information required for an instantaneous benefit decision and payment 
for certain types of medical conditions or presumptions? For instance, 
could a VSO National Service Officer certify that a Vietnam veteran was 
in country and had Ischemic Heart-Disease and then subsequently provide 
VBMS with the required information for an immediate approval?

    6. I understand that 71 of 81 individual Disability Benefits 
Questionnaires (DBQs) are available to private physicians. What 10 are 
still unavailable and why?
    7. In testimony at a previous hearing, the American Legion suggests 
a place on each DBQfor a doctor to state a critical nexus opinion, or 
an assessment of the likelihood any present disability is related to a 
veteran's service experience. Has this suggestion been explored?
    8. Can you provide an update on what has been done to strengthen 
the quality review process for DBQs to verify private physicians, track 
disability ratings that used DBQs, store completed DBQs electronically, 
and other fraud prevention controls?
    9. Can you provide an update on the revision of the VA Schedule for 
Rating Disabilities and timeline for when the review of the 15 
different body systems will be complete?
    10. What challenges do you face in regards to receiving electronic 
Service and Personal records from the National Guard or Reserves for 
the purposes of adjudicating claims?

    a. Does both the Guard and Reserve a central location in which 
these records are stored?
    b. Does both the Guard and Reserve have a standardized format in 
which they complete and store these records?
    c. What challenges does this present to VA in trying to adjudicate 
these men and women's claim in a timely fashion?
    d. Are VA employees receiving specific training on dealing with the 
records and attendant problems of Guard and Reserve members?

    11. I understand that some of the veterans' service organizations 
had issues with Simplified Notice Letters being confusing and overly 
generic.

    a. Has VA worked with the VSOs to fine tune some of the SNL 
language so that they provide sufficient and specific information to 
inform veterans about the reasons and basis for rating decisions?
Technology Questions
    1. I understand that we are contracting out the work to scan 
documents into VBMS, but there are concerns that pages are sometimes 
not in order, that pages are missing, or that files contain pages of 
information from other veterans.

    a. What quality metrics are we holding these contractors up to and 
how are the various contractors performing?
    2. In regards to latency issues with VBMS, is this due to data 
storage in one location?
    3. The National Organization of Veterans Advocates points out that 
currently, claimants are only able to access their case files by either 
requesting a paper copy, which often takes months, or by visiting the 
VA Regional Office by appointment.

    a. Once VBMS is fully implemented, will veterans have electronic 
access to look at their own case files?

    4. I understand that VSOs have electronic access VBMS.

    a. Are the VSOs able to access all files of the veteran they are 
working with?
    b. Will private attorneys be able to have access down the line?

    5. Blinded Veterans of America raises the issue that VA has had 
internally identified American Disabilities Act (ADA) Disability 
Section 508 Compliance issues in the past 18 months and one of the 
significant barriers for blinded veterans trying to file or track their 
claims electronically is lack of accessibility.

    a. What sort of resource planning for addressing ADA 508 
Accessibility for FY 2014 is being made now and for FY 2014?
    b. What is the time frame for fixing eBenefits Program to meet ADA 
508 Access?

Implementation Questions
    1. What is being done to prepare for the estimated 774,000 claims 
(from FY 2013 to FY 2015) that are anticipated as a result of the 
Veterans Opportunity to Work Act/Veterans Employment Initiative and the 
Camp Lejeune legislation?
    2. What sort of outreach and public education is being conducted to 
educate veterans on all of these new initiatives?
    3. Can VBA please compare the performance of the paper based model 
versus the new transformation model at stations that have been in VBMS 
and the Transformation Organization Model since January? In particular, 
can VBA clearly identify and articulate increases in efficiency and the 
accuracy of claims processing.
                     Questions from Rep. Dina Titus
    1. General Hickey, Reno is taking 478 days on average to complete a 
claim. While it sounds like VA is working hard to move towards an 
electronic system the numbers continue to head in the wrong direction.

    a. Do you have any information that you can share with the 
committee regarding the transformation that indicates that your team is 
heading in the right direction?
    b. When can we expect the Reno VA Regional Office to begin reducing 
their average time?

    2. General, can you please explain to me how you have determined 
that a VA Regional Office should receive the station enhancement 
training and have you considered Reno?
    3. General Hickey as I am sure you know over 240,000 of the claims 
in your inventory is stuck in a holding pattern known as awaiting 
evidence. 25% of those claims have been awaiting DoD personnel records 
for more than 60 days and 13% have been waiting for more than 90 days. 
In addition, Service Treatment Records take on average 55 days to be 
received. This is a long time for VA to be waiting for information from 
DoD and leads to delays for our Veterans.
    4. Now, in your testimony before the Senate you indicated that VA 
and DoD had reached an agreement that DoD would provide you with 
certified to be complete medical and personal records. You also 
indicated that this would not reach full operational capability until 
2017, can you further elaborate on this timeline and what was agreed 
to?

    a. What would occur if DoD does not honor this agreement? What 
impact would that have on the backlog in your opinion?
    b. Do you have any other concerns in regards to receiving 
information from other federal agencies?

    5. In a previous Subcommittee hearing last Congress, we examined 
how veterans who suffer from Military Sexual Trauma (MST)-related PTSD 
have only a 1 in 3 chance of having their claims approved.

    a. I understand that VA policy requires that Veterans who have MST-
related PTSD be informed that they may use information from sources 
other than their service records to establish credible evidence of the 
stressors from MST they have endured before VA can deny their claim. In 
your observation of MST cases, is this being done?
    b. Has VA looked at creating a separate lane for MST claims?
    c. What more do you think VA can do to improve training of its 
employees who adjudicate MST claims so prevent improper denial for lack 
of evidentiary documentation?

    6. Can VBA please provide a detailed roadmap of how it expects to 
reach its goal of no veteran's claim pending longer than 125 days with 
98% accuracy by 2015. This should include a detailed analysis of each 
of the 56 VA regional offices with the productivity and benchmarks they 
expect from each of these offices to reach the goal and reduce the 
backlog.
         Responses From VBA to HVAC Minority Members Questions
         Questions from Rep. Michael H. Michaud, Ranking Member
People Questions
    Question 1: Are there certain types of medical conditions that 
could possibly be automated in VBMS for immediate verification and 
payment? Please provide the specific medical conditions if so.
    Response: The Veterans Benefits Administration's (VBA) goal is to 
turn the information contained in the Department of Veterans Affairs' 
(VA) Disability Benefits Questionnaires (DBQ) into data that will drive 
calculator-based engines in the Veterans Benefits Management System 
(VBMS) to provide automated decision recommendations on levels of 
disability. For example, objective results of hearing exams could be 
entered into an automated decision process. Such automation would 
improve decision consistency and accuracy as well as reduce processing 
time. The development of automated decision-support capabilities is a 
priority effort in the future.
    Question 2: In the hearing, it was suggested that the productivity 
of VBA employees had gone down over time. Does VBA believe this to be 
accurate?
    Response: The productivity per employee was calculated as rating 
claim completions per direct full-time equivalent employee (FTEE) on 
the chart presented at the hearing. This data was taken from VA's 
budget. This measure does not provide the full picture of VBA's current 
workload and the productivity of our employees. As mentioned at the 
hearing, today's Veterans are claiming many more disabilities (between 
12 and 16 for recently separating Servicemembers), resulting in an 
increase of medical issues rated per claim and adding to the complexity 
of the process and the time to complete the claim.
    Productivity when measured by medical issues rated per claim shows 
that the number of issues decided per FTEE is increasing. In the first 
quarter of fiscal year (FY) 2008, VBA employees completed approximately 
3.2 issues per each claim. In the fourth quarter of FY 2010, 
productivity improved to 3.8 issues per each claim. This represents a 
13 percent increase in issue-based productivity. During FY 2011, 
productivity on both issues and claims decreased due to the intensive 
review and adjudication of the Agent Orange claims, which are subject 
to court oversight pursuant to the Nehmer court order.
    Issue-based productivity reached a 4-year high in the fourth 
quarter of FY 2012. At the issue level, productivity was up by 31 
percent over the first quarter of FY 2008 and 17 percent over the 
fourth quarter of FY 2010. The net issues per completed claim also 
increased to over four issues per claim.
    Question 3: Does VBA believe that the complexity of an individual 
claim has gone up and therefore the time required to adjudicate an 
individual claim has gone up?
    Response: Yes, there has been an increase in claims complexity. As 
described in response to question 2, claims decided now contain more 
than four issues per claim on average. A March 2013 survey indicates 18 
percent of pending original claims for compensation have 9 or more 
medical issues claimed and nearly 9,000 of them have 20 or more medical 
issues. VBA expects that the trend of increasing medical issues per 
claim and the concomitant complexity of these claims to continue to 
increase.
    Question 4: Could training be better focused if individual VARO's 
focused on specific medical conditions versus all medical conditions 
that a veteran might apply for?
    Response: VBA has already consolidated claims for specific types of 
work (e.g., radiation claims, mustard gas claims, etc.). One of the key 
advantages of the paperless processing system is the ability to manage 
workload on a national basis, unconstrained by the geographic 
limitations of paper claims. The advent of a national workload 
assignment system will allow specialization in specific and more 
complex claims or disabilities by employing targeted training. The 
assignment of more complex claims or disabilities to specialized 
stations will free up other stations to focus on high claims-processing 
output.
    Question 5: AFGE has provided us with training recommendations in 
their Statement for the Record. They raise some important points, such 
as:
    a. How much training is provided to new employees prior to allowing 
them to process cases?
    Response: New employees go through at least 6 weeks of training 
before they process real cases and spend another 4 weeks in a 
centralized environment where they work cases under the direction of 
nationally recognized instructors. These instructors provide daily 
individual mentoring and feedback. VBA tracks the production and 
accuracy of each student. At the end of the centralized training, 
students return to their home offices where they continue to work cases 
under the guidance of local subject matter experts (SME).
    b. In addition to the Change Management Agents that have been 
placed at each RO, how is employee input and other feedback included to 
improve current training or to develop new training programs?
    Response: Training Managers from each regional office participate 
in monthly calls with the Training Staff of Compensation Service to 
provide input and feedback on VBA's training programs. In addition, the 
Training Staff has a special e-mail box that all field personnel can 
use to submit ideas and feedback. The National Training Curriculum 
workgroup, which includes field Training Managers, meets yearly to 
ensure that VBA training is consistent and aligned with organizational 
goals. VBA also receives feedback during training sessions from field 
instructors and SMEs. VBA further develops new training products and 
updates current training based on quality review trends, skills 
certification testing results, and inter-rater reliability results.
    In addition, Quality Review Specialists (QSR) at the regional 
offices review cases and compile error trends at the local level. The 
quality review information is used to develop training at both the 
local and national levels. The QSRs also provide feedback on accuracy, 
mentoring, and training to claims processors.
    c. How often are live cases used in trainings?
    Response: Live cases are used during both Challenge Training and 
Station Enrichment Training (SET). The cases are worked under the 
instruction and guidance of nationally recognized subject matter 
experts. Regional offices (RO) also use live cases during local 
training. The cases are reviewed and the results are used to pinpoint 
knowledge gaps among claims processors to provide targeted training.
    Question 6: AFGE's statement also suggests implementing a time 
motion study to better determine appropriate performance standards. Has 
VA explored conducting such a study?
    Response: VBA conducted a time and motion study at six ROs that was 
completed on April 30, 2013. The study focused on identifying time 
associated with key claims processing activities and defining labor 
requirements for completing specific end products. The results of the 
study will be evaluated and used to generate a capacity analysis for 
claim processing resource allocation and performance standards 
evaluation.
    Question 7: AFGE points out that management incentives are largely 
based on quantity of production. How are incentives calculated to also 
take into account quality of production?
    Response: The evaluation of RO Directors is based on performance in 
five critical elements, including leading change, leading people, 
business acumen, building coalitions, and results driven. Weights are 
assigned to each of the five elements when evaluating the full 
responsibilities of an RO Director. Each element factors in quality 
when evaluating an executive's overall performance.
    Question 8: The Committee was informed that the VBA does not have a 
unified system for aggregating and analyzing the results of both the 
coach reviews and the STAR reviews.
    a. What has been done to strengthen the Systematic Technical 
Accuracy Review (STAR) program and to create a more unified review 
system that ensures proper follow-up, remediation, and training?
    Response: VBA has created dedicated Quality Review Teams (QRT) at 
all ROs to reach the strategic goal of 98 percent rating accuracy by 
2015. All QRTs have received, and will continue to receive, training 
conducted by VBA's Quality Assurance Staff to help ensure consistency.
    VBA has implemented an internal QRT within the STAR staff that 
reviews STAR errors that impact national quality. The STAR QRT conducts 
periodic quality reviews to promote consistency of the reviews 
performed by the STAR rating and authorization employees. The STAR QRT 
also reviews and assesses the results to identify training needs for 
the QRTs in ROs.
    Question 9: Have there been any updates or improvements to the work 
credit system to also focus on accuracy?
    Response: In December 2012, VBA revised the performance standards 
to shift the evaluation of claim processor quality from claim-based to 
contention-based. Evaluating quality at the contention level allows 
management to identify employee deficiencies on specific disabilities 
and provide focused training. The Automated Standardized Performance 
Elements Nationwide (ASPEN) tracker was upgraded to reflect the shift 
in performance standards. Enhancements such as drop-down menus will 
increase data-entry accuracy and simplify the entry of work credit for 
claims processors.
    Question 10: In consideration of moving into a new processing 
system, when does VBA plan to reconsider the work-credit system?
    Response: VBA recognizes the importance of assessing the impact of 
our transformation initiatives on job requirements and appropriately 
adjusting the work credit system for claims processors. VBA established 
a new team in April 2013 to work on shifting employee work credit entry 
from ASPEN to VBMS as we move into an electronic environment. The team 
will work in concert with VBMS programmers to ensure the requirements 
and functionality for individual employee work credit entry is 
incorporated into VBMS.
Process Questions
    Question 1: Does it make sense for VA, in a paperless processing 
system, to have high performing stations specialize and focus on the 
difficult claim types?
    Response: As previously discussed, one of the key advantages of the 
paperless processing system is the ability to manage workload on a 
national basis, unconstrained by the geographic limitations of paper 
claims. The advent of a national workload assignment system will allow 
specialization in specific and more complex claims or disabilities by 
employing targeted training. The assignment of more complex claims to 
specialized stations will free up other stations to focus on high 
claims processing output.
    Question 2: Does VBA believe that focusing on a ``claim'' is an 
effective way to evaluate their workload? Is there a more accurate way 
to estimate the actual workload and to distribute and specialize it?
    Response: Claim level productivity does not provide the full 
picture of VBA's current workload and the productivity of our 
employees. As mentioned at the hearing, today's Veterans are claiming 
many more disabilities (between 12 and 16 for recently separating 
Servicemembers), resulting in an increase of medical issues rated per 
claim and adding to the complexity of the process and the time to 
complete the claim. There is no limit on the number of issues an 
individual can claim.
    Each issue may require VBA to take specific action to obtain 
evidence in support of the claim, including Federal records, private 
medical records, VA examinations, employment information, and Veterans 
Health Administration (VHA) medical records. VBA is currently 
implementing transformation initiatives aimed at reducing time to 
complete claims and eliminating the claims backlog. One aspect of this 
effort is implementing segmented lanes at each RO. The claims are 
triaged and assigned to lanes based on the number or complexity of 
contentions identified. The new method will allow for claims with fewer 
or less complex contentions to be worked by a separate team than those 
claims with numerous or more complex contentions.
    One of the key advantages of the paperless processing system is the 
ability to manage workload on a national basis, unconstrained by the 
geographic limitations of paper claims. The advent of a national 
workload assignment system will allow specialization in specific and 
more complex claims or disabilities by employing targeted training. The 
allocation of high complexity claims to specialized stations will free 
up other stations to focus on high claims processing output.
    Question 3: What proportion of all claims in the past fiscal year 
had a medical condition that was paid in advance of the complete 
adjudication of the claim?
    Response: Intermediate rating decisions were made on approximately 
12 percent of claims. It should be noted that roughly 77 percent of 
Veterans who have a supplemental (subsequent) claim pending are already 
receiving monetary compensation for disability. Supplemental claims 
make up 61 percent of the claims inventory.
    a. What proportion of claims at the Togus VARO, in the past fiscal 
year, had a medical condition that was paid in advance of the complete 
adjudication of the claim?
    Response: Intermediate rating decisions were made on 13.4 percent 
of disability claims. About half of the Veterans with open claims in 
VBA's inventory are already receiving some level of compensation from 
VA.
    b. What proportion of claims at the Los Angeles VARO, in the past 
fiscal year, had a medical condition that was paid in advance of the 
complete adjudication of the claim?
    Response: Intermediate rating decisions were made on 17 percent of 
disability claims.
    Question 4: What factors inhibit a ``pay as you go'' process in a 
paper based adjudication model?
    Response: VA is not prohibited from awarding benefits to a claimant 
prior to resolving all contentions. The VA claims adjudication manual 
(M21-1MR, III.iv.6.A.1.a) requires intermediate rating decisions be 
made if the record contains sufficient evidence to grant any 
contention(s), including service connection at a non-compensable level.
    a. Will all of these concerns be eliminated in a paperless 
processing system?
    Response: VA is not precluded from awarding a claimant entitlement 
to benefits prior to deciding all contentions.
    b. How will VBA be better situated to pay medical conditions as 
they are completed?
    Response: When fully implemented, VA's paperless processing system, 
VBMS, will assist claims personnel in finding information faster and 
managing workload more efficiently. This will allow VA to more quickly 
and consistently award benefits to Veterans.
    Question 5: Under the Fully Developed Claims program (FDC) program:
    a. How many are new claims vs. an increase in ratings?
    Response: FY to date, VA has completed 19,722 FDCs. Of these, 
11,278 were original rating claims and 8,444 were supplemental rating 
claims, including claims for increased evaluations.
    b. Currently, claimants are unable to go use the FDC process if 
they have other claims pending adjudication that aren't in the FDC 
program. Has VA explored changing this?
    Response: Yes. VA designed the FDC program as an optional means for 
a claimant to receive a decision faster. If a claimant files a new 
claim while another claim is already pending with VA, that new claim, 
regardless whether it is fully developed, will often extend the time it 
takes to complete processing both claims because VA must often complete 
new, unanticipated development actions. These new actions thwart the 
promise of expeditious processing of the FDC.
    At the request of stakeholders, VA made an exception to this rule 
if the pending claim is an appeal and the claims folder is located at 
the station of jurisdiction and not at the Board of Veterans' Appeals. 
Such a claim would not impact the timely completion of the newly 
received claim.
    c. What sort of incentives is VA exploring for VSO, State, and 
County partners to increase FDC submissions?
    Response: VA is currently working with the American Legion, 
Disabled American Veterans, to expand and enhance the FDC program. As 
part of this initiative, VA is exploring a program that would recognize 
outstanding achievements of VA partners, including Veterans Service 
Organizations (VSO) and other entities, which demonstrate exemplary 
support of the FDC program.
    d. Is there any way that VSO's can assist in providing all of the 
information required for an instantaneous benefit decision and payment 
for certain types of medical conditions or presumptions? For instance, 
could a VSO National Service Officer certify that a Vietnam veteran was 
in country and had Ischemic Heart-Disease and then subsequently provide 
VBMS with the required information for an immediate approval?
    Response: As previously mentioned, VA makes intermediate rating 
decisions if the record contains sufficient evidence to grant any 
contention(s). VA encourages VSOs to assist claimants in providing all 
evidence needed to immediately decide a claim or contention.
    Question 6: I understand that 71 of 81 individual Disability 
Benefits Questionnaires (DBQs) are available to private physicians. 
What 10 are still unavailable and why?
    Response: Ten of the 81 DBQs are for internal use only and VA does 
not plan to make them available to the public because they require C&P 
examiners to complete specialized training provided by VHA. The 10 DBQs 
are for compensation, pension, Gulf War, specialty exams for cold 
injury residuals, former Prisoner of War protocol, initial Post-
traumatic Stress Disorder (PTSD), initial and review of traumatic brain 
injury, hearing loss and tinnitus, and the medical opinion DBQ.
    Question 7: In testimony at a previous hearing, the American Legion 
suggests a place on each DBQ for a doctor to state a critical nexus 
opinion, or an assessment of the likelihood any present disability is 
related to a veteran's service experience. Has this suggestion been 
explored?
    Response: Yes, VBA explored the suggestion. VBA considered adding a 
question about medical nexus on every DBQ; however, VA examination 
request data shows that a medical nexus opinion is generally not 
required on a compensation and pension examination. For example, if an 
examination pertains to a claim for increased rating, a medical nexus 
opinion is not needed because service connection has already been 
established. In an overwhelming number of cases, requesting a physician 
to dedicate the time and resources to research and opine on the 
likelihood of a relationship existing between any present disability 
and military service would be unnecessary. Therefore, VBA decided not 
to include a specific question on medical nexus on DBQs.
    Question 8: Can you provide an update on what has been done to 
strengthen the quality review process for DBQs to verify private 
physicians, track disability ratings that used DBQs, store completed 
DBQs electronically, and other fraud prevention controls?
    Response: Current guidance requires a special issue ``flash'' in 
the claims file indicating whether a VA or private DBQ was received as 
medical evidence to be used when claims processors input claims in the 
system. In January 2013, VBA completed validation of 1,276 DBQs 
completed by private physicians. VBA concluded that there is little 
evidence of increased fraud risk. VBA will continue its quality 
assurance reviews on at least a biannual basis to verify the 
authenticity of information on DBQs completed by private providers.
    VA is developing a long-term strategy for secured electronic 
submission of DBQs received outside the VA examination process via an 
electronic portal that will enable VA to more easily verify physicians' 
identity and credentials. VBA has also revised the DBQ notifications to 
Veterans and physicians to inform them that information submitted on 
DBQs is subject to verification.
    Question 9: Can you provide an update on the revision of the VA 
Schedule for Rating Disabilities and timeline for when the review of 
the 15 different body systems will be complete?
    Response: VBA expects to complete the initial update of the VA 
Schedule for Rating Disabilities for all body systems by the end of 
2016. The current status of the regulations is below.

      Draft regulations for the endocrine and hemotologic/
lymphatic systems are under review by VA's Office of General Counsel.
      Draft regulations for the digestive and dental/oral 
systems are under review within the Compensation Service.
      Draft regulations genitourinary, audiology, 
cardiovascular, respiratory and infectious diseases systems are under 
peer review.
      Draft regulations for ears, nose, and throat, eye 
diseases, skin disorders, and neurological/convulsive systems are 
currently being written.
      Workgroup discussions are under way for gynecological/
breast, musculoskeletal/rheumatology and mental disorders.

    Question 10: What challenges do you face in regards to receiving 
electronic Service and Personal records from the National Guard or 
Reserves for the purposes of adjudicating claims?
    a. Does both the Guard and Reserve a central location in which 
these records are stored?
    Response: VA does have access to military personnel files of 
Reserves and National Guard members through the Department of Defense's 
(DoD) Defense Personnel Records Information Retrieval System (DPRIS). 
DPRIS currently provides personnel files for:

      Air Force - October 2004 to the present;
      Army - October 1994 to the present;
      Navy - 1995 to the present; and
      Marine Corps - January 1999 to the present.

    However, there is not a central location to obtain service 
treatment records (STR) for Reserve and National Guard units. Because 
the locations of STRs vary for National Guard and Reserve units, when 
VA develops evidence for original disability compensation claims, it 
asks Reserve/National Guard Veterans to provide the name, address, and 
phone number of their units.
    The Army and the Air Force have implemented centralized cells where 
Servicemembers can forward STRs when they separate or retire, including 
Reserve or National Guard units. The central cells verify whether the 
Veteran has a VA claim and forward the STRs to the RO if a claim is 
pending. If there is no pending disability claim, the Army or Air Force 
central cell forwards the STRs to the Records Management Center (RMC). 
Currently the Navy, Marine Corps, and Coast Guard forward all STRs to 
the RMC.
    b. Does both the Guard and Reserve have a standardized format in 
which they complete and store these records?
    Response: All of the military branches maintain a single STR for 
each Servicemember that contains documents in both electronic and paper 
formats. In 2012, DoD and the National Archives and Records 
Administration, updated DoD's Standard Form (SF) 115, Request for 
Records Disposition Authority. The SF 115 specifies requirements for 
systems of medical records, transfer of STRs between DoD and VA, and 
disposition of STRs in both paper and electronic formats.
    c. What challenges does this present to VA in trying to adjudicate 
these men and women's claim in a timely fashion?
    Response: The law requires that VA's efforts to obtain Federal 
records shall continue until it obtains the records unless it is 
reasonably certain that such records do not exist or that further 
efforts to obtain those records would be futile.
    The challenge that VA faces in obtaining Federal records varies 
depending on the location or system in which the record is maintained. 
Current procedures require VA to mail a letter directly to the Reserve 
unit or the Adjutant General's office to obtain these records. 
Additional problems in obtaining STRs occur when Veterans transfer 
between units, redeploy, or separate from the military during the claim 
processing cycle.
    d. Are VA employees receiving specific training on dealing with the 
records and attendant problems of Guard and Reserve members?
    Response: VA employees receive training on records management prior 
to developing disability claims and also receive refresher training 
throughout their careers. This training contains instruction on how to 
process requests for records from all service departments and each 
component, including Reserve, and National Guard.
    Question 11: I understand that some of the veterans' service 
organizations had issues with Simplified Notice Letters being confusing 
and overly generic.
    a. Has VA worked with the VSOs to fine tune some of the SNL 
language so that they provide sufficient and specific information to 
inform veterans about the reasons and basis for rating decisions?
    Response: VBA sought input from the VSOs when first developing the 
Simplified Notification Letter (SNL). VBA also held several training 
and discussion sessions with VSOs during the introduction of the SNL. 
VBA continues to provide training to and have discussions with our VSO 
partners on the SNL. The VA remains committed to improving the decision 
notice for Veterans.
Technology Questions
    Question 1: I understand that we are contracting out the work to 
scan documents into VBMS, but there are concerns that pages are 
sometimes not in order, that pages are missing, or that files contain 
pages of information from other veterans.
    a. What quality metrics are we holding these contractors up to and 
how are the various contractors performing?
    Response: Since execution of the contract for the document 
conversion services, VBA has employed multiple tools to ensure high 
quality. VBA provides document conversion SMEs on-site to provide rapid 
feedback to the vendors. In addition, quality control checks are 
performed by each contractor as part of their internal process.
    VBA recently procured independent validation and verification 
(IV&V) services to replace VBA quality assurance checks. This contract 
enables VBA to utilize data-driven, statistically valid sampling 
methodologies to ensure document conversion standards are met. IV&V 
will ensure objective future reporting of quality metrics. The metrics 
include image quality (99 percent standard), indexing quality (99 
percent standard), and extraction (95 percent standard). If the 
document conversion services vendors do not meet the contractually 
required quality levels, VBA may refuse to pay them.
    Question 2: In regards to latency issues with VBMS, is this due to 
data storage in one location?
    Response: ``Latency'' is a term that has been misused or used in 
multiple contexts. It has been used to describe the time difference 
between new and old ways of doing work, between the time difference in 
loading files of varying sizes, impacts of Internet connection issues, 
and many other descriptions. We believe the question is attempting to 
refer to the time it takes for a folder and its contents to load once 
clicked. At this time, the document storage location has not been 
determined to be a factor in perceived latency for VBMS, because the 
network times and download rates are not major contributors to observed 
latency. Outside of occasional system issues, which can be expected in 
incremental delivery approaches, VBMS is meeting production demands and 
not experiencing latency issues.
    Question 3: The National Organization of Veterans Advocates points 
out that currently, claimants are only able to access their case files 
by either requesting a paper copy, which often takes months, or by 
visiting the VA Regional Office by appointment.
    a. Once VBMS is fully implemented, will veterans have electronic 
access to look at their own case files?
    Response: When VBMS is fully integrated with online claims 
submission functionality through eBenefits and the Stakeholder 
Enterprise Portal (SEP), Veterans will be able to view all the 
documents in their eFolder.
    Question 4: I understand that VSOs have electronic access VBMS.
    a. Are the VSOs able to access all files of the veteran they are 
working with?
    Response: VSOs can access and view records of Veterans who they 
represent. If the Veteran does not authorize VA to disclose information 
related to treatment for drug abuse, alcoholism or alcohol abuse, 
infection with the human immunodeficiency virus, or sickle cell anemia, 
the VSO will not be able to view the Veteran's record.
    b. Will private attorneys be able to have access down the line?
    Response: The plan for the SEP includes providing access to many VA 
business partners who serve our Veterans. Private attorney access is 
included in the future vision for SEP functionality.
    Question 5: Blinded Veterans of America raises the issue that VA 
has had internally identified American Disabilities Act (ADA) 
Disability Section 508 Compliance issues in the past 18 months and one 
of the significant barriers for blinded veterans trying to file or 
track their claims electronically is lack of accessibility.
    a. What sort of resource planning for addressing ADA 508 
Accessibility for FY 2014 is being made now and for FY 2014?
    Response: Making VA accessible for all Veterans, beneficiaries, and 
employees is important not only because it is the law, but because it 
is the right thing to do. Previously, VA's Section 508 information 
technology compliance efforts were divided between the ``Section 508 
Program Office'' within the Office of Information and Technology (OIT), 
and the ``Health 508 Office'' in VHA. In FY14, all 508 efforts will be 
centralized within OIT.
    In FY14, the combined government information technology staff for 
both offices will be 11 FTEE. The FY14 President's Budget has 
$37,265,000 identified for ``Product Development (PD) Tools Management 
Competency.'' This line item includes funding for PD's ``Product 
Assessment Competency Division'' of which $11,871,309 is for VA's 508 
program.'' Non-pay funding will cover:

      Contracted resources to support the development and 
execution of Section 508-related training for developers, testers and 
non-technical staff.
      Testing support services to: (1) bring new software into 
compliance with Section 508 requirements; and (2) audit existing 
Section 508-compliant software to ensure that it remains compliant.
      Maintenance of hardware and software that is used to test 
IT systems for Section 508 compliance.
      Development of an enterprise-wide approach to bring all 
VA SharePoint repositories into compliance with Section 508 
requirements.

    b. What is the time frame for fixing eBenefits Program to meet ADA 
508 Access?
    Response: VA expects to have the eBenefits portal conformant with 
ADA 508 access requirements within the next 6 months.
Implementation Questions
    Question 1: What is being done to prepare for the estimated 774,000 
claims (from FY 2013 to FY 2015) that are anticipated as a result of 
the Veterans Opportunity to Work Act/Veterans Employment Initiative and 
the Camp Lejeune legislation?
    Response: VBA's transformation is designed to improve benefits 
delivery by better leveraging employee skills and streamlining the 
claims adjudication. In the face of dramatically increasing workloads, 
VBA is vigorously pursuing its Transformation Plan that includes a 
series of tightly integrated people, process, and technology 
initiatives designed to increase Veterans' access, eliminate the claims 
backlog, and achieve our goal of processing all claims within 125 days 
with 98 percent accuracy in 2015.
    Over the last 24 months, VA has implemented several ``process'' 
initiatives such as DBQs, SNLs, evaluation builders and rules-based 
calculators, and the FDC initiative. In addition, VA established local 
QRTs to provide timely, responsive quality assurance and training to 
its workforce. VBMS, VBA's tool for paperless claims processing, will 
provide functionality to allow specialization by RO, team, and 
employee. Functionality built into VBMS provides flexibility to allow 
us to better manage our workload as we move into the fully paperless 
environment. VBA continues to work with partners and stakeholders to 
identify requirements for the full functionality of VBMS. VBA estimates 
that once VBMS is fully developed, integrated, and implemented it will 
help improve our production performance by at least 20 percent (in each 
of FYs 2014 and 2015) and quality by at least 8 percent.
    The Louisville RO is our centralized site for the processing of 
Camp Lejeune claims. The RO has averaged 246 claims per month since the 
enactment of the Honoring America's Veterans and Caring for Camp 
Lejeune Families Act of 2012. The Louisville RO is poised to alert any 
significant increase in these claims. Any change in the volume of 
claims will be addressed and an increase in capacity to handle any 
surge will be made. Should a surge occur, VBA is prepared to leverage 
the use of its transformation initiatives to manage this workload.
    Question 2: What sort of outreach and public education is being 
conducted to educate veterans on all of these new initiatives?
    Response: VBA uses several avenues to communicate with and educate 
Veterans, Servicemembers, families, and other stakeholders on the new 
initiatives. These include Facebook Office Hours, Twitter Town Halls, 
and VA YouTube videos. VBA has also redesigned many external facing Web 
pages to provide current information on the initiatives and how to 
access benefits. Through our partnerships with VSOs and Non-Profit 
organizations, we are able to push out information through their 
communication vehicles including publications and Web sites. In 
addition, VBA partners with DoD to expand and improve information 
sharing, refine processes of records retrieval, and identify procedures 
to improve benefits process. Specific to outreach, this data sharing 
has allowed for the deployment of early communication messages to 
Servicemembers informing them of eligibility for benefits based on life 
and career event triggers.
    Question 3: Can VBA please compare the performance of the paper 
based model versus the new transformation model at stations that have 
been in VBMS and the Transformation Organization Model since January? 
In particular, can VBA clearly identify and articulate increases in 
efficiency and the accuracy of claims processing.
    Response: Productivity is measured by Rating Veterans Service 
Representatives (RVSR) individually and by combined Veterans Service 
Representatives (VSR) and Claims Assistants (CA). The percent change in 
productivity is measured by monthly averages for the most recent end of 
month data compared to the same period of the previous year.
    Analysis of productivity for all stations in the organizational 
model and VBMS for end of month February 2013, compared to the same 
month in 2012, indicates improvement in productivity per RVSR by 15.3 
percent and 0.5 percent for VSRs and CAs. The data includes the whole 
of transformation and the 40 plus transformation initiatives which are 
designed to improve production by 45-60 percent and quality by 14 
points in calendar year 2015 as an integrated business transformation 
model. It is difficult to extract each initiative from the combined 
people, process, and technology model to provide detail-level analysis 
toward the contribution to productivity outcomes.
    VBA began deployment of VBMS Generation One in September of 2012, 
concluding the year with a total of 18 stations on the system. It is 
important to note that early adopters of first generation technology 
participated heavily in the development and refinement of efficiencies 
and functionality of the system, which had a direct impact on 
productivity as a result of the live test environment. These stations 
paved the way for the accelerated deployment of VBMS which will enable 
VBA to track and measure productivity outcomes in a consistent and 
accurate manner, once all stations are operating with the new 
technology and after a period of stabilization. The first 18 stations 
enabled VBA to also test business processes and functionality for the 
establishment of eFolders in VBMS and the model for tracking and 
shipping of paper-based claims with two scanning vendors.
                     Questions from Rep. Dina Titus
    Question 1: General Hickey, Reno is taking 478 days on average to 
complete a claim. While it sounds like VA is working hard to move 
towards an electronic system the numbers continue to head in the wrong 
direction.
    a. Do you have any information that you can share with the 
committee regarding the transformation that indicates that your team is 
heading in the right direction?
    Response: The Reno RO is focusing all available resources on 
working claims in the backlog. In addition, the RO is actively engaged 
in implementing VBA's people, process, and technology transformation 
initiatives. In November 2012, the RO implemented the Transformation 
Organizational Model, in which claims are processed through segmented 
lanes based on their complexity and need for case management. The RO 
implemented VBMS, VBA's paperless processing tool, in April 2013. The 
office continues to work closely with the VSOs to increase the number 
of FDCs submitted to enhance RO performance. Monthly meetings are held 
with all VSOs on the FDC process. The increase in FDCs reduces 
development time and resources needed for claims development
    b. When can we expect the Reno VA Regional Office to begin reducing 
their average time?
    Response: The Reno RO is actively engaged in increasing production 
and focusing on their oldest claims. As the RO works its oldest claims, 
the average days to complete will continue to increase. However, once 
these oldest claims are completed, the average processing time will 
decline. We anticipate significant improvements in processing time 
beginning in FY 2014.
    Question 2: General, can you please explain to me how you have 
determined that a VA Regional Office should receive the station 
enhancement training and have you considered Reno?
    Response: In March 2012, VBA initiated SET, focused on improving 
the performance of low performing ROs. In deciding whether to provide 
SET, VBA considers such factors as production, accuracy, feedback from 
Congressional stakeholders, and input from oversight groups such as the 
Office of the Inspector General or General Accountability Office. The 
Baltimore RO is currently receiving SET, which began on April 8 and 
concluded on May 2, 2013. VBA is working to finalize the schedule and 
locations of SET to be held in the remainder of FY 2013 and FY 2014. 
VBA will consider your request to provide SET to the Reno RO.
    Question 3: General Hickey as I am sure you know over 240,000 of 
the claims in your inventory is stuck in a holding pattern known as 
awaiting evidence. 25% of those claims have been awaiting DoD personnel 
records for more than 60 days and 13% have been waiting for more than 
90 days. In addition, Service Treatment Records take on average 55 days 
to be received. This is a long time for VA to be waiting for 
information from DoD and leads to delays for our Veterans.
    Response: VBA continues to regularly and diligently work with DoD 
to obtain complete STRs faster and more efficiently.
    Question 4: Now, in your testimony before the Senate you indicated 
that VA and DoD had reached an agreement that DoD would provide you 
with certified to be complete medical and personal records. You also 
indicated that this would not reach full operational capability until 
2017, can you further elaborate on this timeline and what was agreed 
to?
    Response: Effective January 1, 2013, all military services began 
complying with the Department of Defense Instruction (DoDI) 6040.45, 
Service Treatment Record (STR) and Non-Service Treatment Record (NSTR) 
Life Cycle Management, dated October 28, 2010, and the December 06, 
2012, agreement with revised language for the certification of STRs.
    a. What would occur if DoD does not honor this agreement? What 
impact would that have on the backlog in your opinion?
    Response: All military services are honoring the agreement to 
certify the completeness of the STRs. DoDI 6040.45 mandates that 
personnel at military treatment facilities (MTF) certify they have made 
all attempts to ensure the STRs are complete and include certain forms. 
MTF personnel must transfer the complete STR to their respective out-
processing center no later than 30 business days after the member's 
retirement, discharge, or end of active obligated service. If MTF 
personnel discover additional documents later, the records are 
immediately transferred VA. VA and DoD continue to collaborate to 
ensure that the military services continue to comply.
    b. Do you have any other concerns in regards to receiving 
information from other Federal agencies?
    Response: VBA generally receives STRs from DoD faster than records 
from the, Defense Finance and Accounting Service, Public Health Service 
(Department of Health and Human Services), and National Oceanic and 
Atmospheric Administration (Department of Commerce).
    Question 5: In a previous Subcommittee hearing last Congress, we 
examined how veterans who suffer from Military Sexual Trauma (MST)-
related PTSD have only a 1 in 3 chance of having their claims approved.
    a. I understand that VA policy requires that Veterans who have MST-
related PTSD be informed that they may use information from sources 
other than their service records to establish credible evidence of the 
stressors from MST they have endured before VA can deny their claim. In 
your observation of MST cases, is this being done?
    Response: Yes. The law requires VA to advise claimants who submit 
PTSD claims based on military sexual trauma (MST) that evidence from 
sources other than their service records may constitute credible 
supporting evidence of the stressor to substantiate the claim. 
Accordingly, VA routinely sends a special notice to Veterans filing MST 
claims explaining the other types of evidence that may constitute 
credible supporting evidence of the MST stressor (such as records from 
sources other than the military or evidence of behavior changes). VA 
advises Veterans to submit any such evidence in their possession or 
identify the location of such evidence so that VA can attempt to obtain 
it on their behalf.
    b. Has VA looked at creating a separate lane for MST claims?
    Response: VBA reorganized its workforce into cross-functional teams 
that work together on one of three segmented lanes: express, special 
operations, or core. Claims that predictably can take less time to 
process (about 30 percent of claims) flow through an express lane); 
those taking more time or requiring special handling (about 10 percent 
of claims) flow through a special operations lane; and the rest of the 
claims (60 percent) flow through the core lane. VBA now processes MST 
claims in the special operations lane to ensure the most experienced 
and skilled employees manage these complex claims.
    c. What more do you think VA can do to improve training of its 
employees who adjudicate MST claims so prevent improper denial for lack 
of evidentiary documentation?
    Response: VBA provided mandatory comprehensive training for 
evaluating MST cases in 2012. VBA is also developing robust training to 
assist adjudicators in determining the effective date of MST awards 
under such reviews.
    In addition, recent efforts by VBA have dramatically improved VA's 
overall sensitivity to MST-related PTSD claims and have led to higher 
current grant rates. However, we recognized that some Veterans' MST-
related claims were decided before these efforts began. To assist those 
Veterans and provide them with the same evidentiary considerations as 
Veterans who file claims today, VBA is planning to notify Veterans of 
the opportunity to request that VA review their previously denied PTSD 
claims based on MST. Those Veterans who respond will receive review of 
their claims based on VA's heightened sensitivity to MST and a more 
complete awareness of evidence development. VBA will also continue to 
work with VHA medical professionals to ensure they are aware of their 
critical role in processing these claims.
    Question 6: Can VBA please provide a detailed roadmap of how it 
expects to reach its goal of no veteran's claim pending longer than 125 
days with 98% accuracy by 2015. This should include a detailed analysis 
of each of the 56 VA regional offices with the productivity and 
benchmarks they expect from each of these offices to reach the goal and 
reduce the backlog.
    Response: VBA established the VBA Operations Center within the 
Office of Field Operations in 2013 to focus on accountability to 
achieve workload performance metrics and sharing of best practices 
across VBA ROs and VBA leadership.
    The VBA Operations Center oversees VBA's monthly Stat Review 
program, which is a critical performance technique and tool VBA has 
employed using statistical data (Stat) and visual displays of that data 
to improve performance of ROs and monitor transformation progress. This 
process involves in-depth performance metric reviews of each RO 
designed to analyze and manage performance more effectively. VBA's Stat 
Review is based on the highly successful New York City Police 
Department's CompStat performance management program.
    As a monthly event, the Stat Review identifies patterns occurring 
at various ROs, and every RO participates either in person or by 
teleconference. This program is an effective leadership tool to guide 
efforts to reach the Secretary's goal of processing disability claims 
in 125 days with 98 percent accuracy.
    During the Stat Reviews, VBA top leaders discuss RO challenges and 
successes in day-long meetings, using extensive data-driven performance 
measures for accountability. This allows VBA to identify improvements 
that are needed to produce desired performance results. These Stat 
Reviews help VBA more clearly understand what actions are being taken 
to improve performance, what is or is not working, while motivating RO 
managers and employees to focus their energy and creativity on 
achieving specific results. These reviews help to ensure that best 
practices and lessons learned are shared quickly across leadership 
teams and that we have alignment across ROs on transformation.
    VA's ``ASPIRE'' Web site provides detailed monthly performance 
dashboards that include claims processing targets for each regional 
office and tracks performance against those targets. http://
www.vba.va.gov/reports/aspiremap.asp
    VBA is aggressively pursuing its Transformation Plan, a series of 
tightly integrated people, process, and technology initiatives designed 
to eliminate the claims backlog, and achieve the goal of processing all 
claims within 125 days and with 98% accuracy in 2015. VBA is 
retraining, reorganizing, streamlining business processes, and building 
and implementing technology solutions based on newly redesigned 
processes in order to improve benefits delivery. As part of our 
transformation we have done the following:

      Developed and implemented a new claims processing model - 
one that better leverages employee skills, and streamlines claims 
adjudication. All 56 ROs are operating under this model as of the week 
of March 25.
      Developed, tested, and deployed requisite software and 
hardware to process disability claims paperlessly. From submission/
receipt/scanning to display/review/decision, we now have the capability 
to complete a claim without touching paper. As of May 10, 46 ROs and 
our Appeals Management Center have fielded this capability, called 
VBMS. The remaining ROs will field VBMS by the end of this year. As of 
April 28, over 82,000,000 individual pieces of paper from Veterans' 
records have been converted to images, and over 15 percent of our 
claims inventory is now in VBMS. Clearly, information technology plays 
a critical role in eliminating the claims backlog, and the Department's 
information technology budget has and will enable VA to develop and 
deploy these important tools.
      Designed and implemented new training programs to prepare 
employees for the changes being implemented. The entire VBA claims 
processing workforce was trained on the new processing model, and over 
half the workforce has been trained on VBMS. The 2,431 employees who 
have received the new Challenge training decide 150 percent more claims 
per day than predecessor cohorts, at a similar stage in their 
development, with a 30-percent increase in accuracy.
      Designed and implemented the Veterans Relationship 
Management (VRM) initiative to expand and improve access to VA benefits 
and services. Capabilities and programs integrated within VRM include 
eBenefits (an online portal for Veterans and Servicemembers with self-
service capabilities); SEP (for external partners such as VSOs); 
Customer Relationship Management (to improve service in our contact 
call centers); myHealtheVet (for enrollment in health benefits); Blue 
Button (for access to individual medical records), and Veterans On-Line 
Application Direct Connect (for electronic claims submission).
      Implemented the QRT and the SNL initiative nationwide. 
VBA tracks the impact of these initiatives on accuracy through a 3-
month rolling average accuracy metric that is reported in ASPIRE 
(http://www.vba.va.gov/reports/aspiremap.asp) and can be seen online by 
the public. FY 2012 data demonstrated a 3-percent increase in national 
accuracy standards - from 83 percent to 86 percent. The accuracy 
further increased to 89 percent when looking at just the last 3 months 
of accuracy reviews.
      Completed over 1,000,000 million claims per year in FYs 
2010, 2011, and 2012, the 3 highest production years in VBA history. 
This included 260,000 claims resulting from the decisions to add 3 new 
presumptive conditions for Veterans exposed to Agent Orange. VA's 
regulation changes that made it easier for Veterans to establish PTSD 
as a service-connected disability and created presumptions for nine 
diseases related to service in the Gulf War also contributed to this 
growth in claims receipts.
      Added more than 940,000 Veterans to its compensation 
rolls over the past 4 years, which is more than the size of our active 
duty Army and Navy combined.