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




 
  EXPEDITING CLAIMS OR EXPLOITING STATISTICS?: AN EXAMINATION OF VA'S 
   SPECIAL INITIATIVE TO PROCESS RATING CLAIMS PENDING OVER TWO YEARS

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

                                HEARING

                               before the

                     COMMITTEE ON VETERANS' AFFAIRS
                     U.S. HOUSE OF REPRESENTATIVES

                    ONE HUNDRED THIRTEENTH CONGRESS

                             FIRST SESSION

                               __________

                        WEDNESDAY, MAY 22, 2013

                               __________

                           Serial No. 113-20

                               __________

       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 
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                            C O N T E N T S

                               __________

                              May 22, 2013

                                                                   Page

Expediting Claims Or Exploiting Statistics?: An Examination Of 
  VA's Special Initiative To Process Rating Claims Pending Over 
  Two Years......................................................     1

                           OPENING STATEMENTS

Hon. Jeff Miller, Chairman,......................................     1
    Prepared Statement of Chairman Miller........................    40
Hon. Michael Michaud, Ranking Minority Member....................     2

                               WITNESSES

Hon. Allison A. Hickey, Under Secretary for Benefits, Veterans 
  Benefits Administration, U.S. Department of Veterans Affairs...     4
    Prepared Statement of Hon. Hickey............................    41
    Accompanied by:

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

                       STATEMENTS FOR THE RECORD

The American Legion..............................................    43
AMVETS...........................................................    45
Veterans of Foreign Wars.........................................    47
State of Tennessee Department of Veterans Affairs................    50
Robert J. Epley, Member of the Advisory Committee on Disability 
  Compensation...................................................    50
Iraq and Afghanistan Veterans of America.........................    54
Disabled American Veterans.......................................    56
Bergmann & Moore, LLC............................................    58

                        QUESTION FOR THE RECORD

Question From: Chairman Miller, To: Veterans Benefits 
  Administration (VBA)...........................................    61


  EXPEDITING CLAIMS OR EXPLOITING STATISTICS?: AN EXAMINATION OF VA'S 
   SPECIAL INITIATIVE TO PROCESS RATING CLAIMS PENDING OVER TWO YEARS

                        Wednesday, May 22, 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, Roe, Flores, 
Denham, Runyan, Benishek, Huelskamp, Amodei, Wenstrup, Cook, 
Walorski, Michaud, Brown, Takano, Brownley, Titus, Kirkpatrick, 
Ruiz, Negrete McLeod, Kuster, O'Rourke, Walz.

              OPENING STATEMENT OF CHAIRMAN MILLER

    The Chairman. The Committee will come to order.
    Welcome to today's Full Committee hearing entitled 
Expediting Claims or Exploiting Statistics?: An Examination of 
VA's Special Initiative to Process Rating Claims Pending Over 
Two Years.
    As I initially stated when this initiative was first 
announced and as I will reiterate throughout the hearing today, 
although this new approach sounds promising, I think it is 
critical that this Committee work closely to ensure that it is 
good policy and not just good public relations.
    I will admit and people probably already know that I was 
very frustrated by the fact that both Secretary Shinseki and 
the VA benefits officials had testified before this Committee 
several times in the weeks just before this initiative was 
announced, yet there was no mention of this initiative to this 
Committee as a means to address the backlog.
    I would like to take this opportunity to emphasize that an 
open dialogue between VA and this Committee about the backlog 
and other issues affecting the department is more than 
critical.
    So I hope VA will take this into consideration as it 
continues to address new strategies about how to address the 
backlog in the disabilities claims process.
    And turning back to the initiative that we are here today 
to focus on, I would like to emphasize that VA must not shift 
resources and manpower away from processing new claims as they 
seek ways to clear out older claims. Every veteran deserves a 
thorough, fair, and timely evaluation of their claims 
regardless of when that claim might have been filed.
    This policy should not interfere with that concept and I 
hope that it is not a practice that will continue for a long 
period of time.
    However, the Committee has heard several concerns from 
stakeholders in the process, namely that regional office 
employees lack guidance on how to carry out some aspects of the 
initiative.
    For example, it is currently unclear to many in the field 
how claims processors will follow-up on provisional ratings 
that have been issued one year from now.
    Concerns have also been raised that VHA cannot schedule 
required VA examinations within the required timeframe to have 
these oldest claims adjudicated by the June deadline.
    Further, there are some concerns that this initiative 
involves some statistical manipulation.
    For example, when a provisional rating is issued, the 
controlling end product is cleared. If a veteran submits 
additional evidence within the one-year provisional period, 
this evidence is assigned a new end product with the date of 
claim being the date the new evidence was received, not the 
date that the underlying claim it is associated with was first 
filed.
    Although clearing and entering end products in this manner 
will ultimately make the statistics on the backlog look better, 
they do not get to the heart of the matter which is how VA 
plans to improve its workload management processes in the 
future.
    Finally, VA has stated that of the claims it has completed 
as part of the initiative thus far, many were able to be 
finally adjudicated rather than issued provisional rating 
decisions. And this begs the simple question, why these claims 
were not adjudicated prior to the initiative and, again, what 
VA is doing to better address its workload management practices 
to prevent situations like this from arising in the future?
    Now, despite these concerns, I applaud VA for acknowledging 
that waiting a year, two years, or even longer is too long for 
our Nation's veterans to receive their earned disability 
benefits.
    VA has stated that to date, they have processed 
approximately 22,000 of the nearly 42,000 claims identified for 
the initiative and that they believe they are on track to meet 
their deadline of next month for adjudicating these claims.
    VA meeting one of its self-proclaimed deadlines would be a 
welcome change in our continued oversight of the backlog of 
disability claims. I look forward to hearing more about this 
initiative at our hearing today.
    I would like to thank Under Secretary Hickey for being 
here, Deputy Under Secretary Rubens for appearing with us 
today, and I want to thank all those who submitted written 
statements for the record.
    And I want to 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 want to thank the panelists as well.
    While the VA continues to process more claims than at any 
other time in its history, demand continues to outpace 
production.
    Today's VA total inventory is about 878,000 claims. More 
than two-thirds or 593,000 of these claims remain as part of 
the backlog. And I am happy to note since our hearing in March, 
there has been a reduction in the total inventory by about 
18,000 claims.
    There are about 37,000 fewer claims that are considered 
backlog. I am hopeful that VA can hold the line and continue 
that downward slope in these numbers.
    However, at the current rate, I think we can all agree that 
the Secretary's goal of having no veteran wait for longer than 
125 days with an accuracy rate of 98 percent by 2015 seems to 
be unlikely. Hopefully they can, but right now it seems to be 
unlikely.
    There are many initiatives I know the VA has put in place 
such as a fully developed claims, segmented lanes, e-benefits, 
stakeholder enterprise, veterans' relation management, 
provisional payments, mandatory overtime, and the VBMS system. 
The list goes on.
    But all of these initiatives have been applied by the VA 
with the suggestion that the rise in efficiency will come when 
they have all been deployed fully.
    I would like to hear from this panel today how we know that 
the individual initiatives are working. The transformation with 
all of its individual initiatives has been deployed in some 
places for as long as five months at the high performing 
stations. The time has come to evaluate and share with Congress 
the initial results of this transformation rollout.
    With that said, I applaud the VA for taking big steps in 
moving quickly to transition into an entirely new processing 
system. I know that it has not been easy and you all have been 
working very hard. And as such, my staff has worked with your 
team and within your framework to find solutions that will 
further assist you.
    Our Members have introduced legislation that addresses 
issues raised by the VSOs, VA, and VA's Advisory Committee on 
Disability Compensation and I urge you to work with the 
Committee and my staff to incorporate these ideas as you move 
forward.
    We also need to know from VA what policies which may have 
been well intended to help veterans are not, in fact, hurting 
them as a whole by resulting in delays that cannot be overcome 
with more people, technology, or processes.
    In regards to provisional payments, we have spoken with the 
VSOs and others. They seem to be generally okay with the idea, 
but have asked that you work very closely with them and provide 
them regular updates on the efforts in the form of clear and 
convincing metrics that the initiative is working as intended. 
And I ask that you also keep this Committee informed of your 
progress in that regard also.
    Far too many veterans are waiting far too many days to 
receive the benefits they have earned. We are all working 
towards the same goal, the timely and accurate completion of 
claims. We must continue to work together to achieve a claims 
system that lives up to the service and sacrifices of our 
veterans.
    With that, you know, General Hickey, I look forward to your 
testimony today.
    And I want to thank you once again, Mr. Chairman, for your 
continued effort to make sure that the backlog issue does not 
fall behind and that you continue to have oversight hearings in 
that regard. So thank you very much, and I yield back.
    The Chairman. Thank you very much to my good friend.
    I want to welcome the first and only panel that is going to 
be here with us today. We appreciate the Under Secretary, 
Allison Hickey, for being with us today.
    General, we appreciate the effort that you and your staff 
are putting in to trying to eliminate the backlog.
    Accompanying General Hickey today is Deputy Under Secretary 
for Field Operations, Diana Rubens.
    And we appreciate you being here today.
    General Hickey and Ms. Rubens, we look forward to a free 
flow of information not only at this hearing today, but 
afterwards as well.
    And, Ms. Hickey, you are recognized for five minutes.

                 STATEMENT OF ALLISON A. HICKEY

    General Hickey. Thank you, Chairman Miller, Ranking Member 
Michaud, and Committee Members. Thank you for the opportunity 
to discuss the Department of Veterans Affairs' special 
initiative to address the oldest compensation claims in our 
inventory.
    On April 19th, I directed all regional offices to 
prioritize disability compensation claims that have been 
pending in our inventory for more than two years. Our goal is 
simple, give those veterans who have been waiting the longest a 
quality decision on their claim and if granted, start the flow 
of compensation benefits as quickly as possible.
    I gave our regional offices 60 days to process this 
category of claims which included those claims that were within 
60 days of the two-year mark when the directive was issued. At 
that time, that equated to 67,718 claims.
    Now that we are halfway through the 60-day period, I am 
pleased to report that VA's regional offices have completed 
34,834 of those claims or 51.4 percent of the total and we are 
on track to complete this two-year category of claims on 
schedule.
    And as we announced on 19 April, upon completion of the 
two-year claims, we will shift our focus after examining the 
lessons learned to completing all claims that have been pending 
over one year and do so over the next five months.
    In order to expedite claims decisions for veterans who have 
waited the longest, we made an important policy decision that 
allows for a provisional rating based on the current evidence 
that VA has obtained provided it meets the minimum legal 
requirement.
    The goal of the provisional rating is to provide veterans 
applicable benefits more quickly, but at the same time it 
provides them with a safety net.
    If a provisional decision is used, veterans have up to one 
year to submit additional evidence or request that VA obtain 
additional evidence to change the provisional rating.
    If the minimum required evidence to decide a claim is not 
present like service treatment records or VA medical 
examinations, VA will not make a provisional decision until it 
is obtained.
    If a medical examination is needed to decide a claim, it 
will be ordered and expedited by VA's Health Administration.
    If a veteran submits additional evidence within a year of 
this provisional decision, their case will be fast tracked.
    Should any rating increase be substantiated over the year, 
additional benefits will be retroactive to the date the claim 
was initially filed.
    If no additional action is requested by the veteran within 
that year, the provisional decision becomes final.
    As with all VA compensation claims decisions, the veteran 
then still has an additional year to appeal the final decision 
and VA will provide instructions on how to do so.
    So far, I am encouraged that this initiative along with our 
transformation components is working. For veterans who have 
waited the longest, they are getting decisions on their claims.
    The grant rate for this two-year category of claims to date 
is 70 percent and is on par with our historic averages. These 
are quality decisions for our veterans.
    Our national claim level quality for April was 90.57 
percent, an all time high for VBA. And medical issue quality 
within that claim averaged 95.9 percent.
    This initiative is also helping impact the backlog. The 
current backlog of claims which had reached a high of 611,000 
in March is now 561,000, meaning we have reduced the backlog by 
50,000 claims in less than two months. And as of today, we have 
completed over 29,000 more claims than we did at this same 
point last year.
    While working the oldest claims, VA will continue to 
prioritize veterans who require expedited processing such as 
those who are homeless, facing extreme financial hardship, are 
terminally ill, former prisoners of war, Medal of Honor 
recipients.
    Those servicemembers being discharged from the military due 
to combat wounds or injuries will continue to be processed 
separately in the integrated disability evaluation system and 
then on average receive their rating decision two months after 
leaving the military.
    We will also continue to prioritize fully developed claims, 
a critical part of eliminating the backlog. With the help of 
our great partners and the veteran service organizations, many 
here today, we have grown fully developed claims from three 
percent of our inventory in January to nearly ten percent 
today.
    In conclusion, our oldest claims first initiative is a good 
example of the continuous effort to find ways to improve on our 
processes.
    And I appreciate, Chairman, your leadership and the 
supporting Members of your Committee here who played a key role 
in hosting the national roundtable with private industry last 
week to promote ongoing innovative thinking for us.
    This initiative fully complements the ongoing 
implementation of our long-range strategic plan and help to 
eliminate the backlog in 2015.
    Mr. Chairman, that concludes my statement. I am pleased to 
answer any questions you or the Members of this Committee have.

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

    The Chairman. General, what do you say to the veteran who 
has a claim that has been pending for two, three years that all 
of a sudden within 30 days you have been able to give a 
permanent decision after they have waited three years, two 
years? How does that happen that a file can sit that long 
without a permanent decision being done?
    General Hickey. So, Chairman, thank you for the question.
    So the very first thing I say is that we just do not find 
that acceptable either. I know nobody on this Committee finds 
it acceptable and I know this Nation's veterans, their family 
members, and survivors deserve better.
    I will tell them that while we were doing other claims that 
waited for more than 50 years, we took 37 percent of our 
workforce out of the main body of claims, leaving 63 percent to 
do the rest of those claims while the 37 percent focused on 
those 260,000 Agent Orange claims for our Vietnam veterans over 
the last two and a half years.
    Yes, claims got old. They did. We are sorry about that. We 
are working hard to get answers for those veterans. And as I 
said, we have now for those veterans who have been waiting 
longer than two years have now completed 51.4 percent of those 
claims and we expect to be on target in the next 60 days.
    We took that manpower, that FTE that had been pointed at 
those Agent Orange claims. They required a little additional 
training because they have only been doing three presumptive 
conditions for two and a half years. Once we got them kind of 
back up to speed and could go ahead and surge on that, that is 
why we focused on getting these old claims done.
    The Chairman. So you tell the veteran that has waited for 
three years to get an answer that the excuse is the Nehmer 
claims were the cause of that?
    General Hickey. No, Chairman, it is not an excuse. It is 
not an excuse at all. And we do not ever want it to be in that 
situation again which is why we are working very hard at the 
same time to transform the way we have in 1950s vintage paper 
process system in VBA.
    The Chairman. Who made the decision to open up the 
presumptives for Agent Orange?
    General Hickey. Chairman, the presumptive process, I 
believe, is a system process that starts with a series of 
studies and analysis and recommendations.
    The Chairman. Who made the decision?
    General Hickey. At the end of the day, after the 
recommendations through the IOM process, the secretary makes 
that decision.
    The Chairman. Why did the secretary not make any 
preparations for the immediate influx of claims that would be 
coming into the system?
    You know, I have heard the excuse of the Nehmer claims over 
and over. You and I both know that not every regional office 
handled Nehmer claims. They were brokered and they were sent to 
targeted areas. But that is not an acceptable reason for the 
backlog being over 600,000 claims right now over 125 days.
    General Hickey. So, Chairman, I will say that what did 
happen during that timeframe is that we took all of the 13 day-
one brokering centers, that is our complete VBA surge capacity, 
out of the system and they were very engaged almost exclusively 
on those Nehmer Agent Orange claims.
    So the capacity that we used to have in the system to help 
us when we had a surge became focused on doing those claims. I 
think the good news is that we have reduced that 600,000 now 
down to 560,000 by 50,000 claims in the last month.
    The Chairman. And we are at a point now where the secretary 
had said back in 2010 that we would be at a point that we would 
be processing claims at 160 days.
    General Hickey. So, Chairman, I cannot address that data 
point, so I do not negate it for you. I will certainly go look 
and see what that number is.
    But what I can say is that we have not only increased our 
quality in what we are doing which is a key part of what our 
focus has been for the last 18 months to two years. It is up 
now. In April, our quality numbers went over 90 percent for our 
claim level of quality and 95 percent for our medical issue 
level quality. So we have been focused on getting a better 
answer to our veterans.
    And so I think that the fact that we are, you know, turning 
the curve, we have had now, you know, almost a month worth of 
data points that show that we are producing more claims.
    In fact, we are, I think I said in my testimony up front, 
you know, some 30,000 plus claims ahead of where we were this 
time last year. So we are seeing some productivity 
improvements.
    I can also tell you that associated with some of our 
transformation efforts, we are seeing improvements in the 
number of claims that our raters are doing by a full 13 percent 
and that number is growing.
    And in terms of their productivity by being in a segmented 
lane and by utilization of the rules-based calculators and the 
evaluation builders built into VBMS, if they are on it, and 
also to some of the other training that we have done through 
challenge training which this Committee has so wonderfully 
supported us in budgets to allow us to do.
    The Chairman. All right. Thank you very much.
    You know, there is a great fear that VA is going to use 
this initiative to improve your numbers in the long run by 
getting rid of the oldest claims in one fell swoop. And, you 
know, everybody hears that and they think that that is a great 
result.
    I think that VA's numbers will show a markedly high average 
days to complete in the short term due to the mass clearing out 
of these claims. But the figures that everyone has been 
tracking has been the numbers of claims pending and the average 
days pending, which will improve greatly by cutting these old 
claims out of the pile.
    So the end products of these claims that are being cleared, 
this eliminates the accurate tracking of the actual time it 
takes to get the veteran his or her rightful benefit.
    There are additional serious concerns on end product 
designations at large and the entire work credit system, but 
that is not the focus of our hearing today and, instead, maybe 
the focus of future discussions.
    So the purpose of this hearing, how will VBA track the two-
year claims?
    General Hickey. So, Chairman Miller, thank you for the 
question.
    I will start and then I will ask the person who does that 
every single day all day long from up here in the directorate 
of Field Operations, Diana Rubens, to further elaborate.
    But essentially we have identified every single claim. We 
know where it is. We know how old it is and we know where the 
veteran is. And we are managing that at a case management 
level, very high case management level to complete every one of 
them.
    We are partnered and are in multiple daily calls with our 
VHA leaders for compensation and pension health exams where----
    The Chairman. I apologize. My time is very limited. How are 
you going to track those claims after the fact?
    General Hickey. So, Chairman, when we complete these 
claims, and most of them are in paper as you might imagine, 
these are not the new claims that we are bringing in now into 
an electronic environment and scanning and getting them into a 
paperless environment, these are ones that existed in paper, 
but when we complete them, we are scanning them in.
    The Chairman. I am sorry. Do the new ones and the old ones 
have the same end product number?
    General Hickey. I am going to have to defer that, Chairman 
Miller, to Secretary Rubens.
    Ms. Rubens. Thank you, General Hickey.
    Chairman Miller, there are two things that we are actually 
able to use to track----
    The Chairman. End product number.
    Ms. Rubens. So there is a----
    The Chairman. Okay? So if it is a paper claim and it is a 
new fully developed electronic claim, same end product number?
    Ms. Rubens. Same end product code, but within our system 
today, there are claim labels and flashes that we are able to 
use to identify whether it is a VBMS claim or a paper claim.
    To your first question of how are we going to track the 
claims that we are doing during this two-year effort, we will 
be able to look at those completed during this time and 
anything that may have needed a provisional rating, we will 
identify through a code that we will have input into the system 
when we made that decision as well as the ability to search 
within the rating decision itself the language that says, hey, 
this was a provisional decision.
    So we will be able to maintain a list of which were those 
claims done during this period in the two-year effort as well 
as any that may have required a provisional decision.
    General Hickey. Chairman, there is one more thing I would, 
if I can, just add to that equation. Thus far, we have actually 
completed 95 percent of those claims that I have described to 
you, that 51.4 percent we have completed, without having to use 
a provisional decision, but using a regular process.
    And I acknowledge your comment, well, if you could do it 
then, why can't you do it now. And I think I tried to address 
that. It is demand capacity for some elements of us there.
    But the bottom line is that there is five percent that are 
in this provisional status. And so we are managing those by 
name, by veteran, by claim number now. As we move them through 
the process, we have that original list and we will continue to 
manage them as necessary by name, by veteran, by claim number.
    The Chairman. Mr. Michaud.
    Mr. Michaud. Thank you very much, Mr. Chairman.
    So 95 percent of the 51.4 percent are final. They are 
complete?
    General Hickey. Yes. Yes, they are, Congressman.
    Mr. Michaud. At those stations that have been in the 
transformational process since January such as Milwaukee. What 
upticks have been seen in quality and effectiveness in 
processing the claims?
    General Hickey. So, Congressman, thank you for your 
question.
    I do not have the specific information on each of those 
regional offices. I can get it for you. I am happy to provide 
it to you.
    But what I can tell you in general is that we see, because 
of the segmented lanes, we see an increase of about 13 percent 
for our raters being able to rate cases. In their productivity, 
we see claims volume going through the express lane at about 
that same level of increase.
    Going through the one or two medical issue claims that get 
through faster, and I think I have equated that a little to, 
you know, your grocery store experience, not being behind a 
cart full of groceries, but going through the express lane with 
your couple of little bit of items, you can get through faster. 
That is what our express lane has done. We have been able to 
process more claims through that lane as a result.
    We are also, by the way, putting our fully developed claims 
through that lane now, too, and I appreciate again our VSOs who 
are so actively and state directors, county service officers so 
actively engaged in helping us with that effort.
    Mr. Michaud. What information could you provide the 
Committee that can clearly articulate the transformation 
initiatives that are leading to the quality and effectiveness 
and when can we expect to see that information?
    General Hickey. So, Congressman, I can clearly provide you 
that information. I know we report our quality statistics to 
you all in a number of different reports. But if you want it 
very specifically, I am happy to provide it very specifically.
    The things that we have put in the transformation strategic 
plan that are directly impacting quality are first and foremost 
under our people initiative is our challenge training. And this 
Committee has been very supportive of funding us for the 
budgets for which we are now doing and seeing great results 
associated with a national training program, a national 
curriculum, pre-test, post-test, checks at the three, six, 
nine, and twelfth month process to make sure that the training 
stuck and it is good.
    We have also, due to the generosity of this Committee, is, 
we will have extended that into what we call station 
enhancement training which is where we go to a complete 
regional office and we retrain everybody top to bottom to make 
sure that they have had a reset in terms of what they have 
done.
    We have done that in Oakland. When we did, their quality 
rose by eight percent. Their productivity rose by 27 percent. 
We did it in LA. We are seeing the quality raise as well. Their 
productivity is raising as well. We have just completed it in 
Baltimore. We have already seen Baltimore's quality increase a 
couple of percentage points as well.
    Mr. Michaud. Okay. One of the primary concerns of the VSOs 
with regards to the provisional payments is that the VA keeps 
them, the VSOs informed and updated on the outcomes of that 
initiative.
    What will be included in those communications and how often 
will you communicate that to the VSOs? And will you agree to 
provide the same information to the Committee?
    General Hickey. So thank you, Congressman, for the 
question.
    In fact, Friday morning, I have a meeting, my standing 
monthly meeting with all the VSOs and I know this will be a 
topic of a conversation where I will brief them on some of the 
things that I have talked to you already before on where we are 
in terms of the production of those claims, where we are in 
terms of the quality of those claims, where we are in terms of 
the--I am sorry. There is one more and I am missing it, but I 
will grab it in the rest of the conversation.
    But, oh, in terms of our grant denial rates. I know they 
are particularly interested that we do not end up in a bad 
situation on that and I can confirm for you that we are on par 
with the way we normally and typically grant and deny these 
rates. It is in the 70 percent range.
    And they also have access inside the regional office to 
individuals by name for helping them to know what the status of 
a particular claim is.
    Mr. Michaud. Great. My last question, if you had to pick 
one policy requirement that you believe may be, in fact, 
negatively affecting veterans due to the challenges it presents 
in providing a timely decision, what would that one policy be?
    General Hickey. If I could pick two, Congressman, the first 
I would pick is something we have discussed before and that is 
a complete, absolutely complete service treatment record at the 
departure of a servicemember from service.
    And when I mean absolutely complete, I mean not just what 
happened to be in the paper record when the member left, but I 
mean every bit of their--if they had medical services, 
inpatient treatment, outpatient treatment, contract medical, 
TRICARE, on ship, onboard, guard, reserve, their complete 
service treatment record, 100 percent of it, that DoD certifies 
to me that they have done the exhaustive search.
    That is, one, DoD has agreed to do that with me. I have 
given them until 1 June. They needed a little time to get it 
all set up and I have given them to 1 June. We have agreed on 
the 1 June date, so I should be seeing those complete records 
coming across. That will make a big difference for people 
moving forward.
    I still have, as you well know, a number of veterans of 
different eras where nobody did get their TRICARE record or 
their inpatient hospital record or all those things before they 
came to me which puts us in a bit of the hunt and search mode 
trying to make sure we can say yes instead of having to deny 
because there is nothing in a service treatment record. That is 
one.
    The second one is, I know is in some legislative concept 
packages we sent forward and it has to do with closing claims 
in the appeals process and allowing us to move forward with 
decisions rather than continue to add new claims into the 
appeals process.
    Mr. Michaud. Thank you, Mr. Chairman.
    Mr. Runyan. [Presiding] I thank the gentleman.
    The chair will now recognize himself for five minutes for 
questions.
    And thank you both for being here.
    Under Secretary Hickey, obviously this plan has been in the 
works for some while. You have kind of alluded to retraining 
some people.
    How long has it been in the pipeline because I know 
personally it was kind of sprung on me by Secretary Shinseki 
one afternoon?
    General Hickey. So, Chairman Runyan, thank you for the 
question.
    And I will just tell you as we finished off those 260,000 
Agent Orange claims and took that 37 percent of the workforce 
and recycled them into the full body of medical diagnostic 
codes that they had been trained on, we were thinking then, 
okay, where do we need to go tackle this in a big way.
    I would tell you that we started thinking about it, this 
and many other different kinds of ways of how do we point at 
those environments, started thinking about it in a strategic 
way maybe January of this year, not early, January, February of 
this year, and then started trying to make sure there were not 
any second, third order effects, negative effects.
    It takes a lot of deep dive into a lot of data and moving 
it around. So there was no intention whatsoever. We just wanted 
to make sure we were on solid good ground to do this kind of an 
effort and to make a difference in a really specific group of 
veterans who have been waiting the longest.
    So literally it was working it and figuring it out, so that 
is where we were.
    Mr. Runyan. So the 37 percent that you say were working 
Nehmer claims is the only part of the workforce that you are 
really using? You are not taking from anywhere else?
    General Hickey. Oh, no, not at all, Chairman. It is the 
complete. We are leaning in, all in, all onboard. This is a 
full, full, huge effort for us to go take care of those 
veterans and their family members and survivors who have been 
waiting the longest for a decision from us.
    And now 51.4 percent of those old claims as of today have 
an answer they have long deserved from us. So I will be real 
clear about that.
    And, by the way, the employees that are doing this right 
now are leaning forward in a productivity and quality way to 
make this happen because they care about getting those answers 
done as well. They are very committed to this. You know, I am 
asking a lot of them. They know that 52 percent of them are 
veterans and probably 98 percent of them are a direct family 
member of a veteran and they want us to make sure we are 
answering these old claims as well.
    Mr. Runyan. Now, what happens to a veteran's claim, 
obviously you give a provisional, if he falls outside of your 
window for another medical exam? What happens to that claim 
after that point?
    General Hickey. So thank you, Chairman.
    The way the process works is we give that provisional if 
required to do a provisional. We may be able to do as we have 
now done with 95 percent of the ones we have already done in 
that big bucket, we may be able to get, you know, all the data 
we need and get it completed.
    But in the provisional bucket, if they have in that 
provisional environment, we will keep asking if they want us to 
for different places to get data like DoD medical records or 
DoD DD-214s or different fields on that or private medical 
records. We will keep asking or they can get them and bring it 
to us as well, anything else they might need that they, you 
know, found later on.
    We will consider that all the way up for that whole next 
year. If at that next year point in time they have not found 
the evidence and it falls outside of that, they are still 
entitled to another complete year of an appeals process as 
well. So they actually get a bigger safety net than we have 
actually had in the system before.
    Mr. Runyan. And I think Chairman Miller was kind of 
alluding to this, too, because there is obviously going to be a 
huge impact on your metrics and/or statistical analysis.
    As Members of Congress, we have to be very careful we are 
not allowing you to play games with the numbers to make it look 
better than it seems.
    What do you intend to do with these numbers because 
obviously they are going to shine well on you. We want to be 
very careful on how we present this to our veterans.
    General Hickey. So, Chairman Runyan, thank you for your 
comment.
    And, you know, I can understand some of your skepticism, so 
I will acknowledge that. But I want to just, if I can, say none 
of this for us, none of this for us is about making our numbers 
look better.
    Every bit of this for us is about taking care of a veteran, 
their family member, and their survivor. And none of us are 
pleased if there is anybody we have to be doing this for today 
that has been waiting longer than two years. None of us are.
    So this for us is about I our care core values. This for us 
is about the mission that we need to drive all the way home to 
make sure that we care for our veterans, their family members, 
their survivors.
    And this for us also is about putting in ways in which and 
continuing the transformation so we do not get there again. We 
do not want to get there again. Not every single employee that 
is working head down right now in every one of those regional 
offices out there. They want to be helpful to those heroes of 
this Nation who have served so proudly.
    Mr. Runyan. Thank you.
    With that, I will recognize Mr. Takano for his questions.
    Mr. Takano. Thank you, Mr. Runyan.
    Under Secretary Hickey, the California Department of 
Veterans Affairs is beginning a new initiative to help clear 
the disability claims backlog. They are negotiating a 
memorandum of understanding with our three regional offices to 
place 12 employees supplied by the State of California, the 
California VA. They are calling them strike forces and they 
will be dedicated to helping to clear the claims backlog. This 
is the first time that in our state that State employees will 
be able to integrate and help with these claims.
    As you know, Texas has employed a similar model which has 
been very successful. It was based on that success that 
California developed this plan.
    Are you familiar with this model and do you think it will 
be effective? Do you think other states should be looking to do 
the same?
    General Hickey. So, Congressman, I am familiar with both 
models. Your leadership from the State of California came to 
see me last week, in fact, and laid it out. And I think if I 
could have jumped up from the table and hugged them, I would 
have. Just a phenomenal offer of support from the State of 
California and from the State of Texas.
    And, frankly, we are all hands on deck and we just think 
that is a great partnership and a demonstration of how every 
capability, every resource can be brought to bear.
    So I am extraordinarily appreciative of what California is 
considering doing just as I am with the Texas commission, just 
as I am, frankly, with every veteran service organization out 
there that does claims right alongside of us who is every 
single day increasing the amount of fully developed claims that 
they are producing for us and helping us to go gather all that 
evidence which you can see it in our data. It is clearly the 
long pole in the tent for us.
    So I think it is an extraordinarily good idea. We will make 
whatever provisions we need to make to accommodate that.
    Mr. Takano. Well, along that last comment, I seem to recall 
it is not just the 12 new employees, but they are also 
proposing to do more outreach. They have developed, you know, a 
more extensive plan. And California has asked the VA to match 
some of the funds that California is putting up.
    Is that something the VA would consider doing and do you 
have perhaps some funding already that you already control that 
could be possibly put forward for this purpose?
    General Hickey. So, Congressman, thank you for your 
question.
    One of the things that we are looking at in VBA that we 
have not done before, so I will tell you it is brand new 
territory for us, but we are looking at the idea of, is there a 
way to consider doing things in the grant world that partners 
with folks out there to help in this regard.
    We have not gotten very far on it. I will tell you that. I 
have people researching it right now. We do not even, frankly, 
have grant people in VBA, so I am having to go into larger VA 
to gain some knowledge and understanding of that.
    So as we do that, I am happy to sit down and talk to you 
all and to this Committee about our thoughts on that as we move 
forward.
    Mr. Takano. Well, I am certainly glad to hear that. You 
know, I really want to applaud the people in Texas for what 
they have taken initiative on. And certainly in California, we 
are interested in expediting these claims and want to be part 
of the solution.
    And so I am very proud that our state legislators and the 
state VA have taken an aggressive role here. And so I also 
myself take a look at how the Texas model has worked.
    General Hickey. Great. And, Congressman, I will also 
acknowledge as well, they briefed me that you are also standing 
up a state academy to make sure that you have really well-
trained people in the state, your county service officers, your 
national service officers. You get a force development 
opportunity for them as well. I think that is an exciting new 
idea.
    Mr. Takano. That is what I was referring to, the state 
academy. It is in addition to the strike forces of 12 for each 
regional offices, there was an additional academy and I think 
that is what they were asking the matching funds for.
    And so if there is any way in which the VA can help us with 
that funding. We are not asking for an augmentation but what 
you already have in terms of your funding. And perhaps other 
states could follow suit or consortia states where there are, 
you know, regional offices that many belong to. This might be a 
way forward.
    General Hickey. And, Congressman, I know we have already 
committed people who do our training on a regular basis, our 
training curriculum as necessary and other things just to get a 
head start on it. But I am happy to look and talk to you about 
other possibilities.
    Mr. Takano. My time is expired. Thank you so much.
    Mr. Runyan. I thank the gentleman.
    The chair now recognizes the gentleman from Tennessee, Dr. 
Roe.
    Mr. Roe. Thank you.
    And I want to start by saying hallelujah and all God's 
people said amen after four and a half years. Can we have an 
amen from everybody. You finally got these two-year plus 
claims.
    And I guess just a couple things and I will not even take 
all of my time. But when the Chairman first started, he asked 
about, I guess, why we were able to adjudicate these two-year-
old claims so quickly when they had been waiting so long.
    And I think that begs the question. For four years, I have 
been sitting here and these claims got bigger and bigger. But I 
am very happy that they are. But how did that happen so 
quickly? I mean, I am sure if a veteran, they do not care. They 
got their claim adjudicated. They are happy. I am happy for 
them. But the question is, how can we look at them and say that 
after all this time?
    General Hickey. So, Congressman, I appreciate what you are 
saying and amen from me as well. And let me tell you in general 
how claims can get old in our system.
    First, you know, let's be honest. We touch 5,000 pieces of 
paper in a single year with little rubber fingertips on our 
fingers going through them with mail room people bringing them 
in trying to get them into the millions, 4.4 million paper 
records in regional offices across the country.
    Mr. Roe. And I have been to Detroit and seen where they are 
deposited. I mean, I have seen all that.
    General Hickey. It is really easy sometimes to lose one 
claim in there or multiple claims or even in 4.4 million 
records, it is easy to lose pieces of paper. That is why it is 
so imperative we get into a paperless environment first.
    Second, one thing that does happen, and, frankly, it is the 
case of our oldest claims in the inventory, we will--20 years 
ago, the oldest case in the inventory, 20 years ago, long 
before most people who are in VBA even were in VBA, someone 
rated a case and missed something in the case.
    Then that veteran comes back 20 years later and as a new 
rater is going through the case, they go, uh-oh, there is 
something in here we should have done 20 years ago for that 
veteran. That is what the oldest case is about in our system.
    Rather than just kind of hide it and move away, we do the 
right thing, the integritous thing, and we say, no, let's do 
it. They should have had it 20 years ago and, by the way, they 
should get all the back pay for that 20 years as well. And we 
are doing those today on a regular basis and the checks that we 
cut for that back pay are fairly substantial.
    Mr. Roe. There was some interesting information in our 
packet that I was able to read. And one is, I do not think you 
will ever hit the 120-day number if this continues. If it takes 
112 days to develop a claim, it is impossible.
    So, you know, I guess first, why were the claims not being 
processed under the normal workload within the ROs and these 
were old claims sitting ready to be adjudicated because you 
clearly showed they were because you cleared them out in a 
month? How many are sitting there right now ready to be 
adjudicated?
    And I know my time is short, but, second, the nationwide 
average for waiting development is 112.6 days. So you will 
never get to the 120 days if it takes almost 120 days to 
develop before it even starts the process. You follow me?
    General Hickey. Congressman, the way we have done business 
in the past, I would absolutely unequivocally agree with you.
    What I will tell you, though, is under our new 
transformation effort when a veteran goes online, files online 
through e-benefits like you all did your taxes here this last 
month, uploads their own evidence or uses, which I would highly 
recommend, a veteran service organization officer to file their 
claim online and upload that evidence directly into the system 
right there in the stakeholder enterprise portal, you cut all 
of that waiting development time down substantially.
    And then it goes directly into VBMS where somebody works it 
paperlessly from the beginning. We are also building in right 
now, building the requirements and getting ready to code 
automatic capability that helps to order some of the stuff we 
have got to order so we do not have to wait to develop that 
case. It starts right away as soon as somebody submits a claim.
    Mr. Roe. So we should see that go down with the 
electronic----
    General Hickey. When we get all of this automation in 
place, in solid, in lock, we will. Right now, today we have the 
baseline VBMS. We have actually portal to decision built right 
now. It is all integrated. It comes through. In fact, I have 
650 claims a week without even advertising it except to talking 
to great people and great Americans like you in forums like 
this. We have 650 veterans a week that are coming in that way, 
in a paperless way from e-benefits, through VDC or the 
stakeholder enterprise portal uploading their evidence and 
going directly into VBMS.
    Mr. Roe. My time has expired.
    Mr. Chairman, on behalf of the thousands of veterans that 
have waited two years, I want to thank the VA for finally 
getting this done.
    Mr. Runyan. I thank the gentleman.
    The chair recognizes the gentle lady from Arizona, Ms. 
Kirkpatrick.
    Mrs. Kirkpatrick. Thank you, Mr. Chairman.
    General Hickey, I applaud the efforts the VA has made to 
address the backlog issue and I appreciate that you understand 
that more needs to be done because delayed care is denied care 
for our veterans. It seems we need to build a better system and 
we need to have better benchmarks and metrics in this system.
    After you made that announcement on April 19th, did you 
establish new metrics in the claims processing system for these 
backlogged cases?
    General Hickey. So thank you, Congresswoman, for the 
question.
    Let me tell you what we did. We went out and we collected 
up every single claim down to the eaches, the wand eaches that 
fell into this category. We can identify those in our system.
    We made a list of all of those claims including those 
claims that would roll into the two-year category in the two 
months while we were doing this. So it is not even just the two 
years. It is those that would roll in.
    And we have managed that list at the highest level. 
Literally, I break into her conference room and there are 
people sitting around a table every day constantly working that 
list down by regional office and making sure it is coming down 
by claim.
    Every single morning we know how many we produced the day 
before, how many are now in the list today, what has that done 
in terms of the overall big number, and we literally are 
watching it tick down by the eaches.
    And then so, therefore, we know at what point we have hit 
the halfway point. So we are doing that every single day with 
every single RO managing the workload literally from a national 
perspective which is the first time we have really ever done 
that in that kind of a massive lift.
    Mrs. Kirkpatrick. And what about have you established 
metrics with the Department of Defense in terms of transferring 
their records to the VA?
    General Hickey. I am working that right now. We are in 
discussions with DoD on transferring different parts of 
information. And in some cases, they transfer things relatively 
quickly.
    Part of my issue is it is not complete and part of my 
requirement is to make the very best decision for that veteran, 
that family member, or that survivor with all the evidence 
there is in the DoD system and not to have to recycle back in 
for a piece of data that may not seem important in the grand 
scheme of everything the DoD gives us. And they partner and 
give us a lot of data.
    But in the grand scheme of the decision and ability to say 
yes to that veteran or no to that veteran, it makes all the 
difference in the world to us.
    Working closely, partnership closely with DoD to get that 
100 percent, all the service treatment records, get every field 
we need on the personnel, DD-214s, or in the personnel system, 
all of that. We are working on a day-by-day. I mean, it is 
literally we are active engaged with DoD every day on these 
kinds of issues.
    They have committed to me on 1 June they will give me the 
full and complete service treatment record where they will go 
do the exhaustive search on their side to get not only what is 
in their record, but to get all of the inpatient, outpatient, 
all of the TRICARE, all the contract medical records, 
everything related to that person's medical health, and bring 
it to the table so we do not keep having to cycle and look for 
it.
    Still today, I have about 187,000 pieces of loose late-
flowing medical evidence. It could be a piece of paper that 
comes to us long after we have already made a decision on a 
veteran, so we then have to go cycle back through and open the 
case and see if we can make a different decision.
    Mrs. Kirkpatrick. And I appreciate that June 1st deadline. 
My concern in terms of metrics is what if they are not able to 
do it on June 1st? Is there a consequence? What are they 
required to do then?
    General Hickey. So my consequence in a discussion or my 
accountability partner discussion with DoD is that when I get 
one that is not full and complete, I will send it back.
    Mrs. Kirkpatrick. Okay. And, again----
    General Hickey. And I will manage the time associated with 
getting it back and attributing that time to our partners so 
that they have a way of sensing and knowing where they have 
their problems and how they can solve for that.
    Mrs. Kirkpatrick. One last question on this. Does it make 
sense to have a certain time period, say 125 days, for the DoD 
to transfer records to you, a timeframe, an exact timeframe on 
every single case so you can expect that?
    General Hickey. So, Congresswoman, if they take 125 days to 
give me that, then I have already not met the 125 days that we 
have committed----
    Mrs. Kirkpatrick. Exactly.
    General Hickey. --to by the secretary. I need to have those 
records almost, you know, immediately upon separation for a 
servicemember. In fact, if they can give them to me before 
separation, that is even better.
    Mrs. Kirkpatrick. Okay. Thank you.
    Mr. Runyan. I thank the gentle lady for that.
    And with that, I will recognize the gentleman from 
California, Mr. Denham.
    Mr. Denham. Thank you, Mr. Chair.
    I have a strong belief that our biggest issue continues to 
be electronic records and having one system, an issue that goes 
back to the 1980s when I was a young airman, still is not 
resolved yet today.
    Even after the Department of Defense secretary has made it 
a mandate, the VA secretary has made it a mandate, the 
President has made it a big issue and, yet, we still do not 
have one system to be able to expedite these claims quickly.
    But we have talked about that ad nauseam. For this, 
Committee Members here, I think we will focus on this in the 
appropriations process as well as through legislation. We are 
making that a priority here.
    But I have one question as it relates to the claims 
specifically and I want to concentrate on the claim development 
process and the extraordinary length of time it takes for the 
Veterans Benefits Administration to develop the initial claims.
    [Chart]
    Mr. Denham. And I have got a chart here that states that 
the average number of days a veteran spends waiting initial 
development for a claim is 112.6 days and that the claim will 
spend on average 221.8 days in evidence collection.
    I am concerned that the Veterans Benefits Administration is 
not taking full advantage of the tools it has to cut down on 
the evidence collection period specifically in regard to the 
use of private medical evidence through disability benefits 
questionnaires.
    With a questionnaire completed by a private physician, a 
claim could be developed without waiting to schedule oftentimes 
unnecessary VA medical exam in a district like mine, a rural 
district. Not only does it cost VA a great deal of money, but 
people in my district have to drive a couple of hours at a 
great deal of expense to themselves for a medical exam that 
could be done in Modesto.
    And so Congressman Walz and I recently introduced H.R. 
1980, The Quicker Benefits Delivery Act, that will require the 
VBA to accept private medical evidence unless the veteran 
service representatives and the rating service representatives 
document why that information is not adequate.
    So what steps will you take to ensure that the VBA makes 
full use of private medical evidence to speed the claim 
development process?
    General Hickey. Congressman, I appreciate your question. 
Actually gives us an opportunity to talk about the value to our 
veterans, to our process, to speed our process of private 
medical evidence, and the use of disability benefit 
questionnaires. I have been pushing hard on it to be perfectly 
honest.
    I know that right now today we have, you know, VHA, the 
Health Administration partners are doing, you know, one and a 
half million disability benefit questionnaires last year alone 
and they are on target to hit the same number this year. But I 
only have about 15,000 of them coming in from private medical 
physicians.
    Two things----
    Mr. Denham. Why?
    General Hickey. One, I think, and we are doing something 
about this and we will have an answer, we will have a better 
fix for this in the summertime, I think, frankly, it is a 
little easier for me to ask my VHA colleague to ask his people 
to do a disability benefit questionnaire that we put out there 
that we are trying to simplify and put it on a Web portal so 
that it is easier to do.
    And we are getting there. That is coming this summer where 
it does a nice job of, if you do not say yes here, you do not 
have to see the next 30 questions. You go directly to the ones 
you do have to answer.
    The second thing is we need to do, so I appreciate what you 
all are thinking, we need to do a better job of educating our 
private physicians. We have reached out to people like the 
American Medical Association, to some of the other private 
organizations to ask them how can we reach a broader portfolio 
of physicians in the country.
    So I would ask for your help in that regard. I would ask 
for, you know, in your states and in your communities that you, 
if you could, if you could help me get that word out.
    I think----
    Mr. Denham. Have you looked at this legislation yet that we 
have introduced?
    General Hickey. I have heard of the legislation. I am happy 
to look at it and look at it and provide technical assistance 
to it.
    Mr. Denham. We would ask you to look at that.
    General Hickey. Absolutely.
    Mr. Denham. And we would ask what we can do to be helpful 
for our providers in our area. Somebody from Modesto ought to 
be able to go into one of our hospitals and expedite this for 
you.
    General Hickey. I agree with you, Congressman. We want to 
minimize the amount of burden it puts on our veteran to get an 
exam.
    We have also done two other initiatives. We have a dozen 
regional offices out there right now. We just extended it to 
Waco in that pilot test where we have contract providers who 
are calling private physicians and asking them for records and 
information from private physicians when the veteran tells us 
about a private physician. That has helped to reduce the days 
to collect evidence significantly in those places we are 
testing it. So we are looking at whether or not we can expand 
that to all.
    We are also doing something else called ACE, which is 
acceptable clinical evidence, which means if you are already 
seeing a clinical physician at VHA, let's say you are seeing a 
cardiologist and you get the unfortunate news that your heart 
has degraded and it is not going to get better, I do not have 
to wait to do a compensation pension exam for you. You can ask 
your clinical doctor in VHA to do a DBQ and give it to me 
directly and I can rate off of that and not even have to ask 
you to come in for another C&P exam.
    Mr. Runyan. I thank the gentleman.
    With that, I recognize the gentleman from Texas, Mr. 
O'Rourke.
    Mr. O'Rourke. Thank you, Mr. Chairman.
    I first want to say to General Hickey and Under Secretary 
Rubens that I really appreciate your efforts and I commend the 
seriousness and tenacity with which you are pursuing these very 
ambitious goals.
    And I think all of us on this Committee have done a good 
job of reflecting the frustration and sometimes outrage that we 
are hearing in our district from the veterans that we 
represent. And I feel that you and General Shinseki, Secretary 
Shinseki have heard that and are responding to it and I really 
appreciate it.
    And I want to follow-up on some of the questions and 
comments made by Mr. Denham in terms of fully developed claims. 
It is obviously the way to go and it is going to help everyone 
involved to see better outcomes in the process.
    We also have a bill that we have filed, The Faster Filing 
Act, that will require the VA to publish the resolution times 
for different methods of filing a claim and obviously with an 
incentive to get the VSOs and the veterans to file fully 
developed claims online.
    And so I hope that we can work with you on that and hope 
that that bill becomes law. And even if it does not, these are 
things that the VA could choose to do on its own.
    Do you have a sense of the trajectory that these fully 
developed claims filed online are on? And you mentioned it 
earlier and I did not catch it. What are the percentage now 
that are filed fully developed online?
    General Hickey. I can get you the explicit numbers. What I 
can tell you there is about 650 per week that are coming in the 
door and that has been a steady tick up, but that is without us 
having--and we are about to go do a full, you know, marketing 
effort to help our veterans understand the benefits to them in 
that regard.
    But what I can do is, I will try to give you a bit of a 
visual here, you know, if I can talk with my hands like a 
former pilot for a moment. If I go and look at how we do a 
paper claim today and I look at the overall amount of time it 
takes to do it, it looks something like this, a stack this big 
on a chart I have in my office. If I looked at what it takes 
for a fully developed claim, it is 112 days.
    And to the points about the 112 days just to develop it in 
the other place, it is 112 days fully developed to completion. 
And if I look at it online, it is down in the 80-day range if 
it comes in and all the evidence is there and we can push it 
through the system online. That is where we are shooting for. 
That is why we are driving to this model.
    I cannot get there until I get everybody on the system, all 
the paper out of the system, which we will do this year, we 
will get all the paper out of the system this year, until I get 
into a full paperless environment.
    But I will tell you we are driving that way even including 
our transitioning servicemembers in the current TAP program are 
going to be coming in line, learning how to file online, 
learning the benefit of the VDC process, being asked to bring 
their medical records, their personnel records with them.
    We will have scanners and VSOs there and state directors 
and county service officers, whoever they need to help assist 
them with that. And they can be working with them, you know, 
with coffee in hand in the morning, at lunchtime, after work, 
in breaks, whatever it takes to help them file online at that 
point, so they come into that best model, that least day model 
right up front.
    Mr. O'Rourke. Do you have a target you want X percent of 
claims filed fully developed online by this date and these are 
the steps we are going to take to ensure that we get there 
which will reduce our backlog by, you know, this amount?
    It seems like that is the best bang for the buck, the 
greatest value. You do not have to hire additional people to 
process those if you can get those filed fully developed.
    General Hickey. So the fully developed claim target for 
this year is 20 percent of everything and that is what we have 
asked, you know, our partners to help us with. And they are 
doing in many, many places some extraordinary jobs doing that.
    We have some who are doing 43 percent of their claims they 
are bringing in the door, our fully developed claims with our 
VSO partners doing it. That will be a huge benefit for those 
veterans that they represent. So that is 20 percent this year. 
Next year we are shooting for 30 percent and the year after, we 
are shooting for 40 percent.
    Mr. O'Rourke. And a question that I asked Under Secretary 
Rubens earlier this week, do you have a means by which you can 
measure productivity within your workforce? You know, we 
measure it in the economy, within industries, companies measure 
it themselves. How do you know the productivity value of the 
workforce and individual workers within the VA and how are you 
measuring that?
    General Hickey. So, I think, I would like, since she is 
hands on it most ways, I will tell you we do have productivity 
measures we look at, but I think I would like to ask Secretary 
Rubens to answer that question.
    Ms. Rubens. Thank you, ma'am. Congressman, thank you for 
taking time to talk with us. As we discussed earlier, it is 
about looking at individual employees at individual regional 
offices. Against the number of claims that are coming out the 
door, there are two things that we're, obviously, looking at is 
that overall and then our ability to attribute that to the 
individual employee and the work that they're doing.
    As we move into the digital environment we're looking 
forward to, I'm going to tell you even better, granularity is 
what I would call it, in terms of the level of effort they put 
into whether that's getting a claim developed or completing a 
rating decision or that last piece of it, if you will, 
notifying the veteran that we've done those things.
    So, we are continuing to build on what we've got today and 
looking forward to opportunity that VBMS will allow us to get 
deeper into that look.
    Mr. O'Rourke. And my time is expired, but I would love to 
follow up with you after this to find out, specifically, what 
those measures and numbers are for Waco. And I appreciate yours 
and General Hickey's responsiveness on our concerns about Waco. 
Thank you, Mr. Chair.
    Mr. Runyan. Thank you. And chair now recognizes gentle lady 
from Indiana Ms. Walorski.
    Ms. Walorski. Thank you, Mr. Chairman. Under Secretary, 
it's good to see you. Thank you for being here. I have a 
question. There was a new report out this week by the 
Associated Press that 85,000 veterans are currently being 
treated for issues involving sexual violence and sexual abuse 
in the military, 4,000 of those are receiving disability claims 
right now while receiving PTSD treatment. My question is, how 
many of those claims are over two years old?
    General Hickey. Congresswoman, I don't know. I don't want 
to explicitly say none because I don't know the answer to that, 
so I will find out that answer and take it and get it right 
back to you so that you know.
    I will tell you that we handle those claims in our special 
operations lane with very specifically trained people. They're 
the only ones allowed to touch them. I will tell you since I 
arrived, I have cleaned up a problem that existed before my 
arrival, which we were not going far enough with those claims 
to get exams done for those victims of military sexual trauma.
    We have cleaned that up as of June of '12. We are now on 
par for how we grant those cases, those PTSD due to military 
sexual trauma cases with other PTSD claims. I am especially 
sensitive to this community of men and women who have endured 
things they should never have to endure in the service to their 
country.
    Ms. Walorski. And what evidence is required, at this point, 
today after you cleaned up the issue? What evidence is required 
to prove disability due to sexual violence?
    General Hickey. It is singularly, singularly the lowest 
threshold of evidence that we have on the books today.
    Ms. Walorski. What is the evidence?
    General Hickey. You can tell somebody, your friend, your 
roommate, you can have had missed--gone to sick call the next 
day, that can look like--and even if you didn't go for that, 
even if you didn't tell a soul, you could have missed three 
days of work, you could have your performance degraded over 
time, you could have, I mean, just about anything you can think 
of that you can give us any, literally we are accepting just 
about anything that shows there was some impact that gives us 
at least a subtle marker of some kind.
    Ms. Walorski. And how many veterans are receiving 
disability now today due to sexual violence?
    General Hickey. Somewhere around 4,000.
    Ms. Walorski. And do you have an idea of when you can get 
back to me on the number of claims that are two years old? Do 
we have a timeline?
    General Hickey. We will do that within the next two days.
    Ms. Walorski. Great. Thank you very much. I yield back my 
time.
    Mr. Runyan. Thank you. With that I'll recognize gentle lady 
from California, Ms. Brownley.
    Ms. Brownley. Thank you, Mr. Chair. And I wanted to second 
Mr. Takano's questioning about California and its desire to 
move to a more successful model with these strike teams and the 
academy and so forth and so on.
    I had a similar discussion with our secretary there and it 
sounds like it's certainly a good pathway for us to make some 
much needed improvements, which, you know, brings me to, 
certainly, the Monday Morning Workload Report that we received 
and, certainly, that report highlights some of the problems I 
believe that exist in California with both Los Angeles and 
Oakland, the regional centers there having some of the worst, I 
think, performance in the country vis-a-vis wait times, et 
cetera.
    So, I wanted to know, you know, what the VA is doing 
relative to looking at allocating of staffing resources among 
the VA offices. And, you know, with Los Angeles and Oakland 
both being poor performers, is there adequate and equitable 
staffing there to deal with a backlog because their numbers are 
so much greater than say, for example, Sioux Falls? Which, you 
know, the average days pending there are 84 where Los Angeles 
is 374 and Oakland is 424 days.
    General Hickey. So, Congresswoman, thank you for your 
question and thank you for the support, as well, of the 
California initiative. That will be very helpful to us, and I 
look forward to that relationship and that partnership together 
to meet the needs of California State veterans and their family 
members to survivors better.
    Let me first start, I think you had about three or four in 
there so I'm going to try tick down and if I miss one please 
let me know.
    First of all, we wanted everyone to know that as we do 
these oldest claims you will absolutely, unequivocally see our 
average days to complete go up in those Monday Morning Workload 
Reports. It has to happen mathematically and statistically. As 
soon as you do an old claim it hits that number because it's a 
historical look, not a perspective look, not a future look.
    That said, ADP is coming down across the Nation as we get 
these old claims done and we can get to a younger population of 
inventory.
    Next, you had asked about the allocation model. I think it 
was actually almost now coming up on a year--well, October of 
last year that we actually put more people into both Oakland 
and into L.A., more allocations into both sites. Why? Because I 
looked at how, you know, generations ago VBA's allocation model 
was not necessarily built on demand or demand has shifted to 
where veterans have gone to live.
    And so we need to do something to rewind, re, you know, 
look at those levers, look at that allocation model and we are 
in the middle of doing that right now. But, in the meantime, I 
said we needed to get more capability into both L.A. and into 
Oakland, as well, and we have done that.
    The other thing we have done is, we did do that station 
enhancement training in both sites and in both sites we have 
definitely seen an increase in their quality and in their 
productivity.
    So, we will keep monitoring, keep tracking that as well and 
I know that we are moving forward in that regard.
    I think I got to all of your questions, but if I did not, 
Congresswoman, please let me know.
    Ms. Brownley. I think you did and I would just like to 
actually follow up again on that Monday Morning Workload 
Report, which I find helpful, but it is still unclear to me, 
for example, how many claims Los Angeles office received this 
year and how many claims it has completed. I think this 
information would be helpful in that report so we can really 
track the progress in greater detail.
    General Hickey. Congresswoman, we're happy to provide you 
that information.
    Ms. Brownley. Thank you very much. And--I'm finished.
    Mr. Runyan. Thank you, gentle lady. With that the chair 
recognizes the gentleman from Ohio, Mr. Wenstrup.
    Mr. Wenstrup. Thank you, Mr. Chairman. Thank you both for 
being here today. Ms. Rubens, you mentioned productivity 
measures and you may be able to get better productivity 
measures as things become more electronic, which would 
certainly make sense. Will pay be based on productivity for the 
employees processing claims?
    Ms. Rubens. Sir, the pay system within the Federal 
Government is based on our general schedule. We, obviously, if 
there's an interest in having us look at that, we can talk 
about it. But we are a part of the overall Federal Government 
and so, as we look at the grade structure of the duties 
performed by our veterans service representatives, by our 
rating veterans service representatives, that's driven by the 
Office of Personnel Management Personnel System.
    Mr. Wenstrup. Well, I'd be curious to know your opinion on 
that because sometimes it seems to me, you know, I'm impressed 
that we have had this increase in claims processed, but I 
wonder where the motivation comes from for the individual 
employees and so that's why I question, you know, is it pay 
based or can it be? Because I think it's hard to motivate 
people sometimes if there's not some reward for outstanding 
work as opposed to others that may be falling behind.
    General Hickey, you mentioned, obviously, that the old 
claims are being taken care of, so of course with that, 
immediately, my office was hit with a question, well what about 
the new claims? Are those being forgotten? Could you comment on 
where we are with new claims?
    General Hickey. So, thank you, Congressman, for your 
question and let me just tell you where we are doing new 
claims. If you fall into one of those priority groups, I don't 
care whether you're a minute old in our system, you are 
considered a priority, which is any veteran who is seriously 
injured, ill and injured, or very seriously ill and injured. 
Immediately in the priority bucket, any Medal of Honor 
recipient, former prisoner of war, any veteran who is facing 
extreme financial hardship, they're about to lose their home or 
their ability to eat, you know, things like that. Any veteran 
who is terminal, terminally ill, we want to know that so we can 
expedite that claim right away.
    And we're also doing fully developed claims, yes. It's an 
incentive. So, you were talking about incentives before, we 
want to incentivize new behavior that drives us to that faster 
process, so we are prioritizing fully developed claims and they 
can be brand new ones that just came in the door.
    The other thing I will tell you is we continue to do, and 
we have not taken away any capability for that, our benefits 
delivery at discharge, our BDD and our quick start claims. And 
I will tell you the good news about those, we have cut the 
inventory of those nearly in half. We have gotten many days off 
of veterans who are waiting, specifically, quick start, for 
mostly our National Guard and Reserve folks that use that one, 
cut our waiting days in half. So, we're doing much better in 
those two environments, those continue.
    Those veterans who are coming through the wounded, ill and 
injured process called IDES or the Integrated Disability 
Evaluation System, that's a very specific process, we're not 
touching any capability in that process. That is being fenced 
and cared for, as well. So, all of those ways are ways for us 
to do new claims in the system today.
    Mr. Wenstrup. Thank you very much. What about those that 
have VA loans and maybe are about to foreclose because they're 
waiting on their claim?
    General Hickey. So, there are no VA home loan waiting--
that's a different claim process. These that I've been talking 
about are one of the other six business lines, our compensation 
claims. We actually have a really good new story to tell on our 
VA Home Loan Program. In fact, I will tell you over the last 
five years we have kept more than 290,000 families, not even 
individuals, families of servicemembers, because we do VA loans 
for servicemembers as well, veterans, their family members and 
survivors, in their homes by the way in which we do VA home 
loans and we have avoided about a 9 billion dollar hit to the 
treasury during one of this country's biggest foreclosure 
environments.
    So, we actually do our VA home loans very quickly and in 
that very quickly part of the reason we can, we're paperless. 
We've built a paperless IT system that looks a little bit like 
the early versions of--the new early versions of VBMS because 
it had the identical same program manager when we first started 
building VBMS. He took his lessons from building the--we call 
it Valerie in the VA Home Loan Program, on how to do things in 
a paperless environment with your stakeholders, like mortgage 
lenders and providers. And he brought that lesson learned over 
into, how do we start building VBMS. He's now actually a 
regional office director in New Orleans, Louisiana where he's 
implementing all the things that we have done.
    Mr. Wenstrup. Thank you. And just very quickly, how do you 
feel we are doing as far as making things more seamless 
electronically, for example, from going from DoD to VA?
    General Hickey. We continue to work with our partners in 
DoD. It's a critical partnership for us. You know, the 
secretary is often quoted as saying, what we do in VA largely 
does not start in VA, it starts, you know, in their service. 
It's the nature of that.
    So, we continue to work at that and we get better 
agreements and processes as we do. The next really big one 
comes 1 June, when the DoD gives me that fully certified, 100 
percent complete service treatment record that includes all the 
records including Tri-Care Contract records, in-patient, out-
patient, anything that had to do with the medical readiness, 
medical history of that veteran in that record and they give it 
to me telling me that they have fully exhausted that search. 
That's a big lift for them to do, I appreciate it very much. 
That's a good partnership role for them to have for us, rather 
than us try to go backwards into their system and go hunt down 
and find something in their system. It just makes more sense. 
They own that servicemember and that medical readiness while 
they're in service, giving us everything they have is important 
to do.
    Mr. Wenstrup. Thank you very much. My time's expired.
    Mr. Runyan. Thank the gentleman and with that chair 
recognizes the gentle lady from Florida, Ms. Brown.
    Ms. Brown. Thank you. I was a little late today because I 
was attending the wreath laying at the Women in Military 
Service for America Memorial. I am reminded of the words of the 
first President of the United States, George Washington. Whose 
words are worth repeating at this time, ``The willingness with 
which our young people are likely to serve in any war no matter 
how justified, shall be directly proportional as to how they 
perceive that the veterans of earlier wars were treated and 
appreciated by their country.''
    So, as we go out this Memorial Day, I am hoping that we can 
give--and you really have given a lot of positive updates. I 
want it in writing so I can hand it out at the programs that I 
will be attending on Monday.
    I was recently in L.A. and I will be back out there next 
week with my transportation committee, but I will definitely go 
and visit once again the veterans facility, because I am very 
upset that the Federal Government built four facilities, which 
is 400 units and the State of California, they're just sitting 
there, not operational, four brand new facilities and I would 
like an update on--and it was for homeless, for the veterans to 
be at the VA facility, four units.
    I am very pleased with the progress. It's only a month that 
we're taking care of all of the prior people that had a long 
list of not being processed. So, can you expand on that a 
little more? I know that maybe the other Members heard what you 
had to say, but I need to hear it so that I can convey it to my 
community.
    General Hickey. Absolutely. Thank you, Congresswoman, for 
your question. I will take, for the record, your question about 
the four facilities back to VA for the VHA side of the 
organization.
    But, I will just synopsize where we are on doing the oldest 
claims. We started on 19 April. We had 67,000 in the category 
because we also counted anything that would age over two years 
while we were going through this 60 day process. We have 
completed 51.4 percent of those, meaning more than half of 
those. Ninety-five percent of them, we didn't even have to use 
the provisional rating, we gathered all the data, all the 
effort that we needed to go ahead and make a final decision. 
Those claims, in terms of grant denial rates, about 70 percent, 
which is on par with our normal grant denial rate, so we're 
doing them at a high level.
    And I will also tell you my April--since we started this 
April, my April quality results are showing that first time 
ever, we have crossed the 90 percent category for our quality--
claim quality across the Nation. That's an indicator of the 
investment you all have made and supported us in terms of the 
training we needed to do for our people. And L.A. has gone 
through that new station enhancement training so I'd appreciate 
your feedback on what you're seeing out there as well.
    So, what I'm saying is we are on track, in fact, just a 
smidge ahead of time. We're working closely--our VHA 
counterparts are all in on this one as well, they are working 
to get the exams we need as rapidly as possible. Our VSOs are 
out there helping us too. Going out and helping us find things, 
working with that veteran. So, we're just extraordinarily 
appreciative of the all hands on deck approach everybody is 
taking to do this.
    Ms. Brown. Thank you very much. And, you know, in our last 
meeting I was impressed with how you've turned this around.
    General Hickey. Thank you, Congresswoman.
    Ms. Brown. Thank you. I yield back the balance of my time.
    Mr. Runyan. Thank you, gentle lady. With that, the chair 
recognizes the gentleman from Texas, Mr. Flores.
    Mr. Flores. Thank you, Mr. Chairman. Secretary Hickey and 
Secretary Rubens, thank you for joining us today. Just one--
first of all, I appreciate your initiative to try to address 
these claims and my hope is the same as yours, that it doesn't 
impact the other claims that don't fall within the categories 
getting the extra help.
    Just as a note for you, my Texas colleague, Mr. O'Rourke 
and I sent a letter to you back on May the 6th, regarding the 
Waco Borough (ph). We had some questions and a request for a 
meeting. I'd like you to follow up on that if you get a chance, 
hopefully, in the near future.
    My first question is--by the way, with respect to Waco, I 
want to say this, thank you for the new director that we 
received a little over a year ago. I think he has made a 
difference and he is helping Texas veterans get the care they 
need. Also, with respect to the Waco Borough, thank you for 
working with the Texas Veterans Commission on our strike force 
program, it does seem like that is making a difference.
    And lastly, with respect to Waco, thank you for the 
implementation of EBS. Now, I don't know if it's made a 
difference yet, but Director Limpose in Waco knows I'll be 
sitting down with him every three to six months to follow up 
with how things are going there.
    First question is--this has to do with your press release 
and letter you issued back in April. You gave a self-imposed 
deadline of 60 days and now that deadline is approaching. But, 
in that letter you said three things, one, no issue shall be 
deferred on a rating document, number two, all two year old 
claims will be processed within 60 days and number three, the 
following evidence must be of record and to included service 
treatment records for original claims, VA medical records 
evidenced to establish service dates and VA exams required to 
issue a decision, with emphasis on the last part.
    And so, we're aware that--I mean, because we're at, you 
know, we're getting within the window when that 60 day period 
is going to extend and some VA exams have not been scheduled, 
it's going to be tough to make that date. And because of that, 
some RBSRs have been told that any new VA exam request will 
have a negative impact on your goal for a 60 day completion. 
And because those VA exam requests are being scheduled beyond 
the 60 day deadline, VBA employees are being directed to move 
forward with the evidence on file without the necessary VA 
exams and so, it does seem like the directions that are being 
issued in the field per se are not in accordance with the 
directions that you've issued. So, can you check on this and 
get back to us to make sure that these claims are still being 
adjudicated uniformly and within VA guidance?
    General Hickey. Congressman, I will definitely check on 
anything you all ever believe that you're seeing or hearing out 
there, absolutely.
    I will say though, that VHA exams--we are literally, just 
as we are in overtime, the VHA exam units have also had their 
doctors working overtime. They are doing Saturday and Sunday 
CMP exams, if necessary.
    They are also deploying--TDY deploying doctors to places 
where we have a large concentration if we think that, you know, 
there may be more then can be done by the existing workforce 
there. They are in all hands on deck to be making sure there 
are enough exam capabilities across the system.
    The other thing that we have leveraged largely is, we both 
have contract exams through the CMP functions. VBA has those in 
certain places, thank you to this Committee for that provision. 
So does VHA has a national exam capability. So they're 
leveraging that capability as well to increase the output from 
those environments as well, so we are using every possible 
resource and we're putting the resources in the right place 
where that veteran is to ensure we get those exams done.
    Mr. Wenstrup. I'm glad to hear that. I'm glad that the 
health care side is working with you and I do appreciate your 
initiative to reach out and use private providers as well. I 
think those are going to be very integral to helping our 
veterans.
    Next question I have is more of macro question. With any 
organization, you know, your key inputs that you need to be 
successful are people. You need to have manpower, excuse me, 
that's the people. But you need to have capital or the funding. 
You need to have systems and then you need to set the right 
culture. Pretty much everything VA has asked for with respect 
to people and systems and funding has been granted. So based on 
my visits with different boroughs around the country, and I've 
visited some really great ones like, Muskogee. It seems like 
the culture still varies a lot and as you sort of dig into the 
weeds, it seems like the biggest cultural issue we have is that 
in any given borough you'll have an underperforming group of 
people that you can't seem to get turned around in terms of 
their performance or, alternatively, get rid of them.
    And so my question is this, what can we, as a Committee, 
what can we, as a Congress, do to help you deal with these low 
performers that just aren't going to get it and that aren't 
going to provide the proper level of service to our veterans, 
so that we can make way for people who will? So, that you can 
get the culture, get a Muskogee culture, essentially, 
throughout every borough in the country.
    General Hickey. Congressman, I have actually visited now 
and I have got another couple coming up here in the next few 
weeks, I think, more than 38 of our regional offices across the 
country in less than two years.
    Here's what I see when I walk in there and I have straight 
up conversations with these folks and look them right in the 
eyeballs and I see people who care. They are not there because 
it's a job, in fact, I literally asked this question, how many 
of you are veterans? And I see the 52--well some ROs more than 
that veteran hands go up. And then I say okay, put your hands 
down. How many of you are a direct family member of a veteran? 
Almost the entire room is covered, maybe one or two that are 
not, you know, not having a passion for doing this mission 
because it's the right thing to do.
    The first thing I have to figure out in those places where 
we have performance issues and our employees deserve this, is 
whether or not we trained them right. If we did not train them 
right, then it's not bad on them, it's bad on us. So, that's 
why we have been extensively focused on the new challenge 
training model, to make sure we have the right training for our 
people. Because I can't expect them to do something if they've 
never been trained really well how to do it. So, we have been 
very, very focused on that. And then beyond that there is a 
process, it doesn't just exist in Federal Government. It 
existed for me when I was in the private sector as well and 
it's a performance improvement process where we literally sit 
supervisor to employees experiencing a performance problem and 
we make a written plan with milestones and performance 
expectations and we work that plan to get that person's 
performance up.
    I want to get them in a better place and still working for 
us where they have a passion for this mission.
    Mr. Wenstrup. We all want them to be successful, I agree.
    General Hickey. So, the third thing we are doing, frankly, 
is in VBMS, we are giving them tools so they don't have to 
remember everything in their heads from a book that's stacked 
this big full of rules built from years and years of court 
decisions and years and years of laws and years and years of 
all those kinds of different things and regulation on our part 
to accommodate those things.
    So right now, what we have done is we have taken that rule 
basis and we have put it and built it into the system so it 
queries them, it helps them remember I got to do this, then 
this, then this. Push this radial button, try to submit, it's 
not going to let you submit unless you go do this and this and 
this.
    So, we're helping with some of that performance issue 
inside the system to get the system to aid in a consistent 
answer in a consistent process all the time. And we are seeing 
benefits of that. I think the fact that we have, for the first 
time, in April hit an over a 90 percent threshold on our 
national claims level quality and our medical issue quality at 
95.6 percent now across the Nation, tells me that's working. 
Will we have outliers? Everyone, everywhere has a bell curve 
and we will. We're going to work hard to keep that employee if 
we can. If we can't, then we will figure out the next steps.
    Mr. Wenstrup. Let us know if we can be helpful. Thank you.
    General Hickey. Thank you.
    Mr. Runyan. I have one quick question before we move on and 
it kind of raises a flag. Within this initiative of the two 
year claim fast tracking, are we at a point where these files 
are being adjudicated randomly or whether it's by procedure or 
human nature, are we just getting the easiest ones out of the 
way first?
    General Hickey. So, Chairman Runyan, thank you for the 
question. I'll tell you absolutely not, it's actually 180 
percent the other direction. We are clearly doing the ones that 
have been hardest, have taken the most, you know, they are the 
oldest. We are not grabbing and running and doing the fastest 
and easiest ones first unless they fall into one of those 
priority categories that I mentioned before. I don't think you 
want me to tick through them again, but I would if you want me 
to.
    The ones where they might still have something easy would 
be a fully developed claim. Those become easier to do and those 
do go down our express lane as I have committed to our VSOs to 
do. We have done 67,000 claims in that express lane--an FDC 
claim in that express lane in 112 days in total.
    So, no, in fact, if anything, we are grabbing a hold in a 
strong heavy, heavy case management way those have lingered the 
longest and have been the hardest to do.
    Mr. Runyan. I just raised that because, obviously, the 
numbers in this program are impressive and you're halfway 
through it. There's a deadline that you've self imposed, so, I 
just wanted to clarify that. The chair recognizes the gentle 
lady from California, Ms. McLeod.
    Ms. Negrete McLeod. Thank you. I just wanted to clarify 
something. California doesn't have four homes that are built 
that are not open, it's two. One in Redding, one in Fresno. And 
am I not right, Secretary Hickey, that the Federal Government 
pays for the building of the homes but then the State has to 
pay for the running and because recently California had a very 
large fiscal problem, that the homes were built but they hadn't 
been opened, but it's my assurance that they will be open in 
October or November?
    General Hickey. Congresswoman, I wish that I could answer 
your question, but, unfortunately, that is not one of the 
business lines I do.
    Ms. Negrete McLeod. Well, that is my--that I do know that 
having come from California just recently and having served on 
the sub-committee that was actually dealing with the veterans' 
homes. The veterans' homes were built, only two, one in 
Redding, one in Fresno, they were held up from opening. They 
were completed, but because of the fiscal crunch in California 
they were held out from opening. They will be open in October 
or November and I was assured by the secretary of the veterans 
services in California.
    General Hickey. Congresswoman, I will still get the request 
for both on that subject.
    Ms. Brown. Would you yield to me? I would hate to disagree 
with you, but I went out there, it's four brand new units in 
L.A. I personally went there, sitting there that was built with 
Federal taxpayers money, but the State of California did not 
have money to operate it. These four, which is--there are four 
units, but it's 400, I guess, rooms or whatever that is 
available, brand new, just sitting there.
    And the only reason why I raise it is because there should 
be a system in place where the Federal and the State can work 
together, because it's been sitting there over two years. I 
understand we're in a fiscal crisis, but those veterans that 
could use those facilities are in a much harder crisis. Thank 
you.
    Ms. Negrete McLeod. I guess you don't want a colloquy, so 
I'll just----
    Mr. Runyan. Gentle lady yields back. With that I'll 
recognize gentleman from Nevada, Mr. Amodei.
    Mr. Amodei. Thank you, Mr. Chairman. Secretary Hickey, it's 
my understanding from talking with a physician in my district 
recently that the coding that's used when you talk about 
records and the adjudication process, that the coding model and 
that may not be the right phrase, that is used whether you're a 
private physician or whatever, is 1940s vintage. Is that in the 
ballpark in terms of diagnosis or whatever?
    And he said it in the context of, it's hard for a physician 
for 2013 or 2012 or whatever, when they're writing stuff for VA 
to have to try to make it fit with a '40s vintage coding model. 
And if that's true and if it's not just say, hey it's not true 
and I'll accept that. But if it is true, then what's being done 
to kind of bring us up to the point where everybody is talking 
the same medical language?
    General Hickey. Congressman, I appreciate your question and 
also the visit that you had with our staff this week, as well, 
to learn more about what we're doing in Nevada as well.
    I have a limited knowledge on this, but I will share with 
you what I know. There are two different sort of diagnostic 
code processes and I think this is what you're addressing. One 
the VA uses and one that sort of private medical folks use. 
It's my understanding that there's an effort ongoing to see if 
they can map those two kinds of things together to facilitate a 
common understanding of those different diagnostic codes.
    Beyond that, I will have to take the rest for the record 
and I'm happy to do so, to get you an answer.
    Mr. Amodei. Okay. Thank you. Also, the mandatory overtime 
for claims is, obviously, something that's out there on the 
record. Before that decision was made was there any cost 
benefit analysis done, mandatory overtime--and I'd be curious 
as to what the projected cost for that is. I think it's 
supposed to run for a specific time.
    Mr. Takano and some of the Texas folks said, you know, that 
they had strike teams there and were looking for resources. Was 
there any cost benefit analysis done to mandatory overtime 
versus, you know, giving money to those States with task forces 
or something else other than just saying, hey, guess what, 
we're all going to turn out all hands on deck for a little bit 
longer?
    General Hickey. Congressman, we have actually long used 
overtime as a significant quiver in our arrow in our quiver. 
We, last year, were in a, for a period of time, albeit a 
shorter of time in mandatory overtime for compensation claims 
folks.
    We have also until recently with the automation that 
arrived thankfully in September 24th of last year that allowed 
us to get the education claims inventory down significantly to 
the point where we're doing the bulk of that work in about five 
days.
    We used to have to put our education claims processors in 
mandatory overtime, not for a short period of time, but for 
almost three quarters of a year.
    The reason why it's a good use of that resource is because 
it takes about two years to get someone to a journey level 
capability to be able to adjudicate these cases.
    And thanks to Chairman Miller's holding of the round table 
last week, we had the opportunity to talk to some industry 
partners who also shared with us, it takes them about the same 
amount of time, 18 months to two years to get someone to 
adjudicate these kinds of claims.
    So, it is the best--and albeit I'm asking a lot from our 
employees, but we have tried to do it in a way that's sensitive 
to the fact that they can't just burn straight until the end of 
the fiscal year. They have to have a moment of reprieve to 
catch their breath to spend a little time with the family 
vacation time. So, we have allowed in the process some 
flexibility--actually have provided in the process some 
flexibility for those 20 hours a month, including electing a 
month where you do not have to do that mandatory overtime----
    Mr. Amodei. I don't mean to cut you off, but I'm down to 
about a minute. I didn't hear a lot about cost benefit 
analysis. I do appreciate the historical data, though.
    And finally, when you talk about resource allocation and 
model and I was interested to hear that my colleagues from the 
Golden State, Ms. Brownley and them talking about L.A. and 
Oakland. But, unfortunately, the only regional office that 
serves the State of Nevada is one that's gained some 
distinction lately.
    And I appreciate you making your staff and Ms. Rubens 
available and look forward to working with you. But when I look 
at that office and see it, that resources have been cut in 
terms of personnel and budget--I just want to say, I look 
forward to you visiting the office, I look forward to hearing 
what you think after you've got that visit under your belt, but 
I still find it very curious that resources being cut in an 
office which in some way leads the Nation in ways that we don't 
want to. And so I'll look forward to talking with you after 
you've visited Reno because my time's up and I yield back, Mr. 
Chairman.
    Mr. Runyan. Thank the gentleman. With that I recognize the 
gentleman from California, Mr. Cook.
    Mr. Cook. Thank you very much, Mr. Chairman. Obviously, a 
lot of ground has been covered and I'm happy to see some of the 
improvements that have been made in this thing. And I'm--full 
disclosure, I'm probably the most cynical Member of this 
Committee in terms of the VA and the VA claims.
    I still have a problem with the continual use of acronyms 
on everything. It's part of the culture that we were talking 
about. I have problems talking about metrics and all these 
other buzz words. You've got to have words that the veterans 
understand. Forget the rest of this other stuff. They want to 
know the straight scoop.
    You know, I talk to them, I'm just a dumb Marine. General, 
I'm not as smart as you or anything like that, but I am tired 
of the run arounds that I get there.
    Now, I hear it takes two years to train somebody, two 
years. It takes ten weeks to train a Marine, a soldier or what 
have you and that might be for the most important job that they 
have and that is to close with and destroy the enemy.
    Maybe we should have two years to train them, that is far 
more important. Now, I get very excited about this and I have 
to apologize. And I appreciate that you're visiting those 
organizations. And I have to ask you, do they know you're 
coming in advance? Because if you look at the history of what 
has happened, if I was in charge, I'm sorry, I'd show up at 
14:00 in the afternoon and say, you know, I'm Cook, here's my 
social security number, run it on me, what's going on?
    And I am very, very happy that attention is being paid and 
part of it is because of this Committee and I'm just afraid 
that after this is over we're going to go back in the same rut 
where, you know, the claims get slower and slower and once 
again, you know, we get back in this culture.
    So, I'm trying to believe this and I apologize for being so 
aggressive, but I've had too much coffee this morning and I'm 
late for a Committee and all those things.
    But all I'm saying is, the veterans, they just want the 
straight scoop. They don't want all these big buzz words. They 
don't want the acronyms. They just get, you know, just let them 
know what's going on and what they're expectations are.
    They are, you know, I think they're the easiest patients in 
the world, I really do. And they go down there and they wait 
and they wait and they wait and then they come back in another 
few months and this and that.
    And as I said, I'm part of the Vietnam generation and a lot 
of us have just given up on the system. And this is terrible, a 
lot of them have just ripped up their claims and they say, you 
know, no one really cares.
    And I think the other thing you have to address is how many 
of these people have dropped out and said because of all the 
abuses that have happened maybe in the last decade or even 
longer, they just have no faith.
    So, I appreciate what you're doing. I think we've got to 
almost rejoin or get these people back in there and all I'm 
asking is, the language that we communicate, forget the medical 
terms and use the terms that they understand. And I would ask 
your help on it and I'm very, very happy that you're making 
progress on this and I'm sorry I'm so animated this morning.
    General Hickey. Congressman, I appreciate, one, your 
service to this country and I love Marines, so thank you for 
your service as a Marine.
    Mr. Cook. Is the secretary still going to invite me back to 
breakfast after my last----
    General Hickey. Absolutely, Congressman.
    Mr. Cook. I got it.
    General Hickey. I don't have to ask him that question, 
absolutely. Let me just--I want to pick up on what you're 
talking about. The staff in and around me as we are writing 
things and doing things, here's two things from me, quite 
talking in lawyer talk and get rid of the gobbley gook. And 
those are my big fancy words for exactly what you just said, 
which is let us just in very simply straightforward language 
tell a veteran what we need to tell them.
    So, I'm actually happy that you raised that question. I 
have been working hard to push the gobbley gook out of the 
system. That is a culture change. It is a culture change when 
you have court cases pushing on you and everybody wants to make 
sure everything's got the lawyer language protection around it 
or the medical jargon protection around it. But we have to stop 
doing that, so I'm all on board with your idea.
    Mr. Runyan. Thank the gentleman. With that I recognize the 
gentleman from Colorado, Mr. Coffman.
    Mr. Coffman. Thank you, Mr. Chairman and Secretary Hickey. 
First of all, thank you so much for your service to the United 
States Army and now your service to the Veterans 
Administration.
    You mentioned, I think, in that complexity and I think 
there is extraordinary complexity in the claims process and I 
think you mentioned that taking two years to bring somebody up 
to speed in terms of to process claims, to be effective in 
terms of processing claims, to do that training.
    And so, one thing, I guess, one of my questions is, do 
people specialize in a given--are there people that just only 
do PTSD or only do Agent Orange or only do physical wounds, 
such as amputations?
    General Hickey. So, Congressman, you're headed right where 
we're headed, which is when we are all in an electronic 
environment, when we can share a claim no matter where you sit 
in the country and we can say for the six medical issues you 
have inside that claim, let's get the group of people who do 
PTSD best to do your PTSD, let's get the group of people who do 
TBI to do TBI, let's get the people, you know, you can start 
now saying inside that claim let's apply a human capital filter 
to that and say who are the best people in demonstrated 
performance to do those kinds of medical issues. You're going 
exactly where we're trying to go.
    Mr. Coffman. Thank you. I would encourage you to start 
making that movement now. Simply because of the fact that, you 
know, to have teams that are already specialized, even though 
you're transitioning from paper to electronic, not to wait in 
that process.
    What I've found when I was State Treasurer for Colorado, I 
looked at the court system in terms of--I think I used the 
State of Delaware as an example, that they had done a business 
court, set up a business court with a court process that only 
looked at business cases. And I think they called it the 
commercial court or something like that and so we looked at 
replicating that in Colorado and in Colorado what we found was, 
we only had specialty courts for water issues and nothing else.
    And so, what the studies that I looked at nationally in 
terms of adjudicating cases in terms of civil procedure was 
that cases moved, when there was specialty courts, cases moved 
along faster and that the results were move uniform. Not only 
did they move along faster but there was less variance in terms 
of the results and I think that it's very important to develop 
that specialty now within the Veterans Administration to say 
that we're going to develop this expertise in Agent Orange, 
we're going to develop this expertise in PTSD, in other areas.
    And I think that the training will move along faster, the 
expertise will be developed sooner and I think the results will 
be more predictive if, in fact, we start the process of 
specializing these claims personnel now and not waiting until 
we've gained the electronic capability.
    There's no question that when you gain that capability of 
just doing things electronically that it will be easier, that 
you will even be, in fact, more sufficient and more able to 
exploit specialization.
    But I think that the claims are large enough where you can 
do it now and it will make a difference now.
    General Hickey. So, Congressman, thank you for your insight 
on that. It's very helpful. And, in fact, I will correct 
something I just said a moment ago. We have actually already 
started that segmentation. One of the three lanes is a special 
operations claim lane that there are only certain kinds of very 
complex medical conditions that can go down that lane and they 
are specialized to those very senior journey level people who 
can do them well.
    So, for instance, Parkinson's goes down that lane, Diabetes 
goes down that lane, things that have lots of inferred or--now 
I'm using a medical term I promised I wouldn't do. Things that 
have--you know, you claim one thing, but you can have lots of 
things wrong with you associated with that, from like a 
Diabetes, you have your foot problem and your blood sugar 
problem and your head problem and whatever it is. Those kinds 
of complex claims do now go down our special operations lane 
and people are trained, specifically, against those kinds of 
claims.
    Mr. Coffman. Well, I want to suggest for post-traumatic 
stress disorder because that is--I'm an Iraq War Veteran and I 
think that's a huge issue for Iraq and Afghanistan veterans and 
it's a big piece of the backlog that we have right now. And so, 
I really think that--and I think it does require a certain 
specialization. There ought to be a cadre of personnel that are 
solely focused on post-traumatic stress disorder and that's 
their speciality and that's their focus and moving those cases 
along.
    I just think that that would make the system more 
efficient, that would make the adjudication of these decisions 
much more predictable than they are today.
    General Hickey. Thank you, Congressman.
    Mr. Coffman. I yield back, Mr. Chair.
    Mr. Runyan. Thank the gentleman. I, again, have one, other 
question before I go to Dr. Benishek.
    It's an issue of concern brought to the Committee's 
attention that if the VA can rate the file with a connection in 
it as it is, there's not an exam being ordered, which 
potentially could increase the rating. Is there any truth to 
that?
    General Hickey. I'm going to need to clarify the question 
again. I'm sorry, there was a lot of movement by my ear, I just 
missed a few words. I'm sorry, Chairman.
    Mr. Runyan. You're rating a two year file and there's 
evidence of service-connection disability in it and we're 
talking about not ordering an exam to--which is normal 
procedure, to potentially increase that claim. Is that 
happening that they're not ordering the exam?
    Obviously, there's evidence of service-connection, but 
there's potential that there could be an increased benefit.
    General Hickey. So, I'm going to say what I'll say and then 
I'm going to ask Ms. Rubens, see if she can get to your issue 
even better than I will try to.
    The way that we are doing these today is, you have to have 
a minimum of your service treatment records in order for us to 
do those and character and nature of service, obviously, and 
the exam, if the exam is required then we will do those as well 
and we are expediting those in lots of numbers with lots of all 
hands on deck out there.
    So, I'm not sure I get to the nuance, but I'll ask Ms. 
Rubens if she does.
    Ms. Rubens. General Hickey, I think you've hit the point. 
Chairman Runyan, I'm not sure if you're referring to some of 
the concerns that we've heard mentioned today that we are, 
obviously, going to go back and follow up on to insure we are 
ordering those exams.
    We've worked with VHA. General Hickey enumerated all of the 
efforts that they're putting to this as well. I would add to 
that one other thing and that's that they have committed to 
having medical doctors in each of our regional offices to work 
with us so that if one of those other things won't do it, we 
have an opportunity to look at the evidence that we have, if we 
still require an exam, the guidances, order the exam.
    Mr. Runyan. Well, I think my issue is a change in that exam 
as it's been sitting in that file for two years. Do you see 
what I'm saying? That not ordering another exam to potentially 
have a change in----
    General Hickey. I think if the case is that the medical 
exam is stale, if that's what you're asking, Chairman, will we 
order another medical exam? Is that what you're asking?
    Mr. Runyan. Yes. For a potential of an increased rating at 
that point. You have evidence there but it's, obviously, been 
sitting and not being adjudicated over a period of time.
    General Hickey. So, I will get that. I will find out 
explicitly for you what that specific guidance is and whether 
we even have a problem there. I don't know that we even have a 
problem there. But I will come back and I'm glad that Secretary 
Rubens made the comment.
    But, we also as a focus of doing these right and well, we 
asked our VHA partners to position a full-time physician in 
each of the regional offices, depending on the workload, there 
are some that are very small and they can't give them enough to 
do. But there are many of them that are now in regional 
offices, you know, every single day and they are there for a 
rater or a VSR to come up quickly to them on the spot and say I 
need a medical opinion on this, I need, you know, something of 
that nature where we can get immediate access just in time to 
be able to grant that condition if we can.
    And that is our motto, grant if we can and deny only if we 
must.
    Mr. Runyan. I'm just more worried about the evidence you 
would need to increase a rating, that's my concern on this one 
and our concern is that a follow up exam is not being ordered. 
Do you see where I'm coming from?
    You have evidence there. There's potential that there could 
be an increase in benefit if another exam was ordered. I'm just 
wondering about procedure there.
    General Hickey. Chairman, I'll go look at the issue and try 
to get a little better information for you to give you a better 
response. I know we're, obviously, not scratching that itch for 
you yet, so we will go back and look and see if we can figure 
out how to get to your concern.
    Mr. Runyan. I appreciate that. With that I recognize, Dr. 
Benishek.
    Dr. Benishek. Thank you, Mr. Chairman. Good morning.
    General Hickey. Good morning.
    Dr. Benishek. I was kind of curious about the 60 day effort 
to clean up cases over two years of age and I was happy to hear 
you say that, you know, you're on time in your 60 day window.
    Would you please report to myself and the Committee, it 
looks like it's going to be June 19th is the date, from what I 
can understand, that that's the end of the 60 days.
    So, I would like to actually hear what your success rate is 
at that time and what percentage of them are provisional 
ratings versus, you know, the final ratings, because I'm 
skeptical a lot of the times of we're going to have this done 
in 30 days. You know what I mean? I hear that all the time and 
it's a little frustrating to me.
    So, I'd like to get that report at the end of June then 
what your actual success rate is. I know there's been criticism 
about, you know, how you're doing it and everything --I don't 
know, I think if you tried something and if you can actually 
accomplish it in the 60 days, I think that will be a laudable 
goal.
    I just want to follow up on something that we talked about 
earlier and that was the performance review for, you know, 
personnel that don't seem to be meeting their productivity 
standards.
    And you mentioned the teaching, you know, the training for 
making sure that, you know, two years it takes to train some of 
these individuals. And I kind of agree with Mr. Cook that that 
does seem to be a long time to get somebody trained in there.
    But I can accept that, but I can't accept the fact that 
somebody's not performing and I'd just like to know how many 
people in the--I don't have to know the names I don't imagine, 
but how many people are actually getting performance reviews in 
your department? Is there a percentage? I mean, how many cases 
of performance review are actually, somebody had a review in 
their file in the last 60 days. Do you know anything about that 
number?
    General Hickey. So, Congressman, I don't know the number 
for that. I think you're asking me about the performance 
improvement plans or the PIPs as they are called.
    Dr. Benishek. Right. Right.
    General Hickey. I don't have those numbers immediately 
available to me. But, I do know they are used and they're, you 
know----
    Dr. Benishek. Can I get an eight?
    General Hickey. But successfully graduated from in a lot of 
times, as well. You know, when we put somebody on a performance 
improvement plan--this is my experience in industry as well. 
It's my desire to do that in order to improve your performance.
    Dr. Benishek. Well, exactly, and I understand that and I 
hear that, but I don't know if it's actually happening. You 
know what I mean?
    How many employees are under case managers or case--how 
many employees do you have doing that?
    General Hickey. So, we have six different business lines in 
VBA and in the compensation line, we have for people directly 
touching a claim, it's about 10,000 people.
    Dr. Benishek. Oh, 10,000 people, so could you maybe come up 
with a number or actually give me a relatively accurate number 
as to how many people have gotten a performance review in the 
last 60 days out of that 10,000?
    Ms. Rubens. Congressman, I appreciate the question. I don't 
have the specific number with me, but I can assure you that we 
look regularly at the number of employees that we've got on 
performance improvement plans. We'll come back to you with the 
information in particular around those 10,000 that are working 
claims in that last 60 days. How many have been on a 
performance improvement plan and where we are today with those.
    Dr. Benishek. Yeah, I would appreciate that, please. 
Because I'm just not--I'm concerned about the fact that there's 
not enough performance and there's not enough review of 
performance in the management of the VA, because I've had this 
experience where we're going to do something and yet it doesn't 
get done and I just don't like to hear that answer.
    General Hickey. So, Congressman, one of the things that we 
have done in the nature of looking at our business and our work 
a little differently is, I have re-coded the system that allows 
me to look in the performance system for our employee, a system 
called ASPEN and I don't know what it stands for, but it's the 
system where they log what they're doing and the system keeps 
track of all that.
    We have created a way to look at not just claim level, 
quality and things of that nature, but we have a way now of 
looking at the individual medical issue level quality that we 
have never had before.
    And what I can tell you as I said earlier in the 
discussion, we have actually seen both our claim level quality 
increase as a focus of really focusing in on training, really 
focusing in with our quality review teams, we took a major 
investment of the compensation staff to be in process checks 
and reviews of how people are doing in errors that we typically 
see.
    And as a result of that, we've actually reduced those 
errors rather significantly over the last year. And that, I 
think, has contributed to the growth of our quality numbers in 
the process.
    When we look at performance, we look at it both from a 
production and a quality environment. One can't trade for the 
other.
    Dr. Benishek. Well, of course. I mean, I understand that 
there are going to be a relatively complicated review because 
claims are different. I mean, you can't expect somebody to 
process ten claims an hour, because obviously, there's going to 
be a lot of different variables there. But it seems to me that 
there should be some standards of performance that you have.
    Maybe that will be another thing that I would like to see 
what exactly the standards of performance are and you said it's 
complicated, could you give me--Ms. Rubens, perhaps you're the 
one that we should get that information. I mean, what would be 
sub-standard performance then in view of the complicated nature 
of the review that Ms. Hickey relates?
    Ms. Rubens. We'd be happy to share that information with 
you. Effectively, if I'm a Veterans Service Representative or a 
Rating Veterans Service Representative, I have some 
expectations about the number of things that I do and they vary 
depending on what part of the process the claim is in, 
gathering the evidence and making the decision, as well as 
quality that the under secretary eluded to. The quality review 
teams are there looking at claims every month for each employee 
to insure that they are doing a quality job. But we'd be happy 
to provide some of that information that helps illuminate that.
    General Hickey mentioned the improvement and the quality 
that we're seeing across the system. Organizationally, we've 
done about 30,000 more claims this year from an output 
standpoint, as well, then we did last year up until this time.
    I would tell you that I think over 50 percent of the 
employee workforce are veterans themselves, they are very 
committed to what we're doing. And working within the system of 
performance, it's not just about the performance improvement, 
but celebrating the successes that they've brought for 
veterans.
    General Hickey. And if I might just add one quick thing. 
They have done all those improvements while they have gone 
through the singularly largest series of changes and 
transformation in this organization has seen in decades.
    So, not only did they improve their production and improved 
their quality, they did it while going through a major major 
change.
    Dr. Benishek. Well, thank you, I appreciate your comments. 
I actually appreciated Mr. Coffman's ideas as well, I hope that 
is taking place and I look forward to seeing your responses to 
my ask. Thank you, Mr. Chairman.
    Mr. Runyan. I thank the gentleman and thank you all for 
being here. General Hickey, Ms. Rubens, thank you for your 
testimony. You're now excused.
    This concludes our hearing for today. I ask unanimous 
consent that all Members have five legislative days to revise 
and extend their remarks and include all extraneous material. 
Hearing no objection, so ordered.
    I'd like to, once again, thank our witnesses and audience 
and Members for joining us here in today's conversation and 
this hearing is now adjourned.

    [Whereupon, at 12:03 p.m. the Committee 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, entitled ``Expediting 
Claims or Exploiting Statistics?: An Examination of VA's Special 
Initiative to Process Rating Claims Pending Over Two Years.''
    As I initially stated when this initiative was first announced, and 
as I will reiterate throughout the hearing today: although this new 
approach sounds promising, we must monitor it closely to ensure that it 
is good policy rather than just good P.R.
    I will admit that I was very frustrated by the fact that both 
Secretary Shinseki and VA benefits officials testified before this 
Committee several times in the weeks just before the initiative was 
announced, yet there was no mention of this initiative to this 
Committee as a means to address the backlog.
    I'd like to take this opportunity to emphasize that an open 
dialogue between VA and this Committee about the backlog and other 
issues affecting the Department is critical.
    I hope VA will take this into consideration as it continues to 
develop new strategies to address the disability claims process.
    Turning back to the initiative that we are here to focus on today, 
I'd like to emphasize that VA must not shift resources and manpower 
away from processing new claims just to clear out older ones.
    Every veteran deserves a thorough, fair and timely evaluation of 
their claim, regardless of when it was filed. This policy should not 
interfere with that concept, and I hope that it does not in practice. 
However, the Committee has heard several concerns from stakeholders in 
the process, namely that RO employees lack guidance on how to carry out 
some aspects of the initiative.
    For example, it is currently unclear to many in the field how 
claims processors will follow up on provisional ratings that have been 
issued one year from now. Concerns have also been raised that VHA 
cannot schedule required VA examinations within the required timeframe 
to have these oldest claims adjudicated by the June deadline.
    Further, there are some concerns that this initiative involves some 
statistical manipulation. For example, when a provisional rating is 
issued, the controlling end product is cleared. If a veteran submits 
additional evidence within the one year provisional period, this 
evidence is assigned a new end product, with the date of claim being 
the date the new evidence was received, not the date that the 
underlying claim it is associated with was first filed. Although 
clearing and entering end products in this manner will ultimately make 
the statistics on the backlog look better, they do not get to the heart 
of the matter, which is how VA plans to improve its workload management 
processes in the future.
    Finally, VA has stated that of the claims it has completed as part 
of the initiative thus far, many were able to be finally adjudicated 
rather than issued provisional rating decisions. This begs the simple 
question of why these claims were not adjudicated prior to the 
initiative, and again, what VA is doing to better address its workload 
management practices to prevent situations like this from arising in 
the future.
    Despite these concerns, I do applaud VA for acknowledging that 
waiting a year, two years, or even longer is too long for our Nation's 
veterans to receive their earned disability benefits.
    VA has stated that to date, they have processed approximately 22,00 
of the nearly 42,000 claims identified for the initiative, and that 
they believe they are on track to meet their target deadline next month 
for adjudicating these claims.
    VA meeting one of its self-proclaimed deadlines would be a welcome 
change in our continued oversight of the backlog of disability claims. 
I look forward to hearing more about this initiative at today's 
hearing.
    I'd like to thank Under Secretary Hickey and Deputy Under Secretary 
Rubens for being here today. I would also like to thank all of those 
who submitted statements for the record.
    I now yield to our Ranking Member, Mr. Michaud.

                                 
              Prepared Statement of Hon. Allison A. Hickey

    Chairman Miller, Ranking Member Michaud, and Committee Members, 
thank you for providing me the opportunity to discuss the Department of 
Veterans Affairs' (VA) special initiative to address the oldest 
compensation claims in our inventory. The first step of this initiative 
was launched on April 19, 2013. I directed all regional offices (RO) to 
process within 60 days all rating claims pending for over 2 years. Once 
those claims are completed, we will focus on rating those claims that 
have been pending for more than 1 year. This initiative will accelerate 
the receipt of benefits for those Veterans who have waited for a 
decision for the longest period of time as part of VA's overall 
strategy to eliminate the claims backlog in 2015. For the purposes of 
this testimony, I will address the 2-year old claim plan that is 
currently underway in all ROs. I am accompanied today by Diana Rubens, 
Deputy Under Secretary for Field Operations.
Implementation Plan
    Effective April 19, 2013, and after valuable input from our 
Veterans Service Organization (VSO) partners, VA began making 
``provisional'' decisions on the oldest claims in the inventory. This 
adjudication allows eligible Veterans to begin collecting disability 
compensation benefits immediately based on the evidence of record, 
allowing many Veterans who have waited the longest to more quickly 
begin collecting compensation benefits. In all cases, VA will ensure 
that the Veteran's applicable service treatment and personnel records 
are available for review in connection with the claim. We will further 
ensure that VA medical examinations or opinions are in the record if 
they are necessary to decide the claim. All Veterans Benefits 
Administration (VBA) claims processing personnel have been fully 
trained on how to process these claims and are eager to expedite 
benefits for those Veterans who have waited the longest.
    To ensure fairness, Veterans will be permitted to submit additional 
evidence or request that VA obtain additional evidence for a full year 
following the provisional rating, before VA issues a final decision. 
This 1-year ``safety net'' provides Veterans the opportunity to 
identify or obtain additional evidence that may change the provisional 
rating, particularly with respect to the disability evaluation level 
assigned. If VA receives additional evidence within the 1 year 
following the provisional rating that substantiates an increased 
evaluation, VA will pay the increased compensation back to the original 
date of claim. Following the year-long period of time for the 
submission of additional evidence, VA will issue a final decision to 
the Veteran, and include information should the Veteran decide to 
appeal the decision. The Veteran will then have the standard year to 
appeal the decision.
    Throughout this initiative, VA will render final, rather than 
provisional, decisions on claims where all available evidence is of 
record or when the rating assigned for each claimed issue already 
provides the highest level of disability compensation allowed under our 
laws and regulations. Also, Veterans may request to receive a final 
decision with appeal rights, rather than a provisional decision, before 
the 1-year provisional period ends.
    VBA's plan is to complete claims pending 2 years or longer within 
60 days and claims pending 1 year or longer within 6 months. VA will 
continue to prioritize Veterans who are most in need.

      We have been, and will continue to prioritize claims for 
homeless Veterans, the terminally ill, former Prisoners of War, and 
Medal of Honor recipients. About 3,000 to 5,000 Veterans per month in 
this category are receiving expedited claims processing. We will also 
continue to prioritize Fully Developed Claims (FDC), which are critical 
to eliminating the claims backlog.
      Veterans who are facing financial hardship are also 
prioritized and tracked specifically by VA ROs. VA can assign that 
status based on the case, or Veterans can self-identify--either when 
filing or by alerting VA after the claim has been filed. VSOs can also 
alert VA to prioritize cases for financial hardship on behalf of 
Veterans they represent.
      For wounded, ill, and injured Servicemembers separating 
from the military for medical reasons, there is an Integrated 
Disability Evaluation System (IDES) to ensure a ``warm handoff'' 
between the Departments of Defense (DoD) and VA. For this system, VA 
dedicates staff solely to process claims for this priority population. 
VA completes IDES claims in less than half the normal processing time.

    This initiative will not affect Veterans who have already received 
a decision on their claim and have filed an appeal.
Content and Basis of Provisional Ratings
    When making a provisional decision, VA will grant or deny the claim 
based on the evidence of record; however, provisional decisions will 
not be made on claims where the following evidence is absent from the 
claims record:

      Service treatment records (STR) for original claims;
      VA medical records;
      Any evidence needed to establish Veteran status and/or 
pertinent service dates, if available evidence is not otherwise 
sufficient; or
      VA examinations, if such exams are pending at the time 
the case is reviewed or if exams are necessary to make a decision on 
the claim.

    If required Federal records outside of STRs have not yet been 
received, VA will issue a provisional decision and request the Federal 
records. VA will review any new evidence received as a result of this 
request and issue a final decision on the claim. If the claimant has 
additional relevant evidence pertaining to the claim, he or she is 
given 1 year from the date of the provisional decision to provide it to 
VA or to request VA's assistance in obtaining it. Upon receipt of any 
new evidence, VA may render a final decision and provide appeal rights.
    VBA notified the Veterans Health Administration (VHA) of this 
initiative, and the 2 administrations have worked together to identify 
existing examination requests for claims over 2 years old. Future 
examination requests on these claims will identify the specific 
priority, and ROs are working closely with their VHA partners to ensure 
timely examinations. Nationwide, VHA's average processing time for 
returning completed exams has remained at 30 days or less since August 
2011. As ROs will only be working the oldest claims and certain 
identified special-issue categories, existing non-priority examination 
requests will be quickly worked through the system so we can 
concentrate on these oldest claims.
    The contracted disability examination providers have also been 
notified of VBA's initiative to expedite certain examination requests. 
Specifically, all 2-year-old claims pending contract examinations were 
identified, and contact was made with the vendors to ensure 
prioritization. We do not anticipate that this will affect the 
scheduling of other pending examinations.
    DoD has also collaborated with VBA in this initiative, granting 
additional access accounts to RO personnel that allow us to directly 
access DoD's Armed Forces Health Longitudinal Technology Application to 
search for additional medical evidence, if needed. In addition, for 
several months now, a number of DoD personnel have been co-located at 
VBA headquarters to assist in locating service medical records needed 
to support pending claims.
Reporting Metrics
    As a result of this initiative, metrics used to track benefits 
claims will experience significant fluctuations. By eliminating the 
oldest claims from the inventory, VA lowers the average days pending 
for claims in the overall inventory. VA is aware that this focus on 
taking care of those Veterans who have been waiting the longest will 
also cause the measure for average days to complete (ADC) a claim to 
rise significantly in the near term. Over time, as VA clears out this 
backlog of oldest claims and increases processing of new claims 
electronically, we expect the ADC measure to significantly improve. As 
of May 14, there were about 28,800 claims over 2 years old and 206,822 
over 1 year.
Summary
    VA is launching this initiative to expedite claims decisions for 
Veterans who have waited the longest. We will also continue to 
prioritize claims from Veterans who are homeless, terminally ill, 
former Prisoners of War, and Medal of Honor recipients, those facing 
financial hardship and our most seriously injured, in addition to 
processing claims that are fully developed. Today, we have rated 62,000 
FDCs in 111 days, on average - demonstrating how critical the FDC 
initiative is to resolution of the claims backlog. Our VSO partners are 
fully supportive of using FDC and recognize the increased efficiency, 
quality, and productivity that result.
    We must eliminate the claims backlog; the President has made that 
very clear. That is why VA is launching this initiative to expedite 
claims decisions for those Veterans who have waited the longest - we 
owe them a decision. This concludes my testimony. I would be happy to 
address any questions or comments from Chairman Miller or the Committee 
Members.

                                 
                       Statements For The Record

                          THE AMERICAN LEGION

    The first step to solving a problem is to admit that you have a 
problem. For many years now when pressed for answers regarding the 
growing backlog of disability claims, the response from the Department 
of Veterans Affairs (VA) has been to forestall any concerns by 
repeating the mantra of ``everything is under control, when the 
Veterans Benefits Management System (VBMS) rolls out, we will have the 
backlog under control and we will meet our goal of 98 percent accuracy 
and no claims pending more than 125 days.'' On April 19, 2013 VA 
finally admitted they had a problem, and needed to take extraordinary 
measures to stay on target.
    The Letter that VA issued on April 19 was entitled ``Guidance 
Regarding Special Initiative to Process Rating Claims Pending Over Two 
Years.'' \1\ We are pleased that VA is taking action to address this 
select group of massively backlogged claims, and VA's efforts to 
contact The American Legion and other Veterans Service Organizations 
(VSOs) as they neared a launch date for this plan is further laudable. 
At the end of the initiative, more than 50,000 claims that have been 
pending for more than two years will have some kind of resolution for 
the veteran, while more than 200,000 claims pending a year or more will 
be similarly resolved. Following the directions of the ``Fast Letter'', 
these claims will be moved to a digital format, further supporting VA's 
ongoing transformation to an electronic operating environment. The 
American Legion finds that there are many things to praise VA about 
with this initiative.
---------------------------------------------------------------------------
    \1\ VA Central Office (VACO), VBA Letter 20-13-05.
---------------------------------------------------------------------------
    That said, The American Legion believes that there are many serious 
concerns still outstanding with regard to the implementation. 
Ultimately, the disability claims process is supposed to be inherently 
pro-claimant, with the best interest of the veterans held paramount. 
The American Legion has been working with our network of over 2,600 
accredited service officers to receive real time feedback of what is 
transpiring in the field. As our Regional Offices (ROs) struggle to 
implement the program, they are also struggling to address the concerns 
of veterans who are affected by this policy change.
    One of the chief concerns that The American Legion has is the 
allocation of personnel resources that will need to be devoted in order 
to successfully implement this program. As we understand it, all Rating 
Veteran Service Representatives (RVSRs) and the majority of Veteran 
Service Representatives (VSRs) will be devoted solely to this project, 
and Decision Review Officers (DROs) will be diverted from their appeals 
work to work these claims as well. While assurances have been made that 
certain priority groups (Homeless, Terminally Ill, Medal of Honor 
recipients, Former POWs, and Fully Developed Claims) will still receive 
priority, all other work has been tabled to devote resources to this 
initiative, and our service officers are concerned this may be an 
overreaction. Claims being worked on one day will be suddenly set 
aside, even if they are ready to rate, and delayed until the oldest 
claims can be completed. In the interest of addressing the older cases, 
a claim that required something as minor as a signature in order to be 
processed for payment to the veteran may now sit on the shelf 
needlessly for months. The American Legion believes that there must be 
a better way to address this process, rather than by suspending work on 
some claims while diverting resources to others. Even a skeleton crew 
finishing last minute work on nearly completed claims would help 
ameliorate this problem.
    One of the problems beginning to emerge may be systemic, and bears 
further scrutiny; ROs are being instructed to assign an ``EP (End 
Product) 400'' code to provisional ratings. Our staff has been told the 
EP 400 code will ``automatically expires on a certain date and 
subsequently disappears.'' A full record of any previous adjudicative 
actions is essential in case a claim must be appealed. What the long 
term effects of these changes to end product codes will be is still 
unclear, and how these end product codes will affect tracking of claims 
is still unclear. The number shuffling by changing end product codes is 
a serious concern to The American Legion.
    Further systemic problems are raised by the conversion of all of 
these claims to the electronic VBMS format. While The American Legion 
fully supports moving VA into the VBMS operating model, not every 
office is prepared for this. Some ROs are being forced into handling 
claims in VBMS without the proper preparation and roll out, which 
creates problems for service officers attempting to help veterans with 
their claims. In many cases at some ROs, we are receiving reports of 
claims being decided, and sent out for scanning, before service 
officers are allowed to view and review the file for appeals 
determination. If the service officers can't access the full file and 
analyze the rating, veterans are at a disadvantage for their appeals. 
In order for the process to be truly fair, everyone has to have access 
to all of the information. The scanning process alone adds two weeks to 
a month to the wait time before a service officer can review the file, 
and if the RO is not yet fully equipped for VBMS, it is likely in a 
format that will make review difficult.
    The lines of communication between VA and the VSOs in this matter 
have been improved in recent years, but The American Legion still has 
concerns about this vital link in the communications chain. While some 
ROs conducted meetings with the VSOs to brief them on the operation of 
this initiative within their office, this has not been consistently 
done. The improvements in communication between VACO and the VSOs needs 
to be better distributed on a national level to ensure it is getting 
down to the ``boots on the ground'' level. Furthermore, when VSOs 
raised concerns about omissions in basic procedural rights regarding 
the provisional decisions, such as ensuring necessary medical 
examinations take place, and ensuring all required federal records had 
been obtained, VACO was receptive to the critiques and made changes to 
the plan, which The American Legion greatly supports and appreciates; 
but the fact that those omissions even existed in the first place - and 
needed to be pointed out by the VSOs involved - is troubling.
    Finally, a concern has emerged through this process involving the 
new forms being utilized by VA for veterans to express a Notice of 
Disagreement (NOD). The new NOD forms are problematic in two areas, and 
both of these concerns reflect troubling directions VA is pursuing in 
terms of potentially affecting the appellate rights of veterans who may 
be dissatisfied with the ratings of their claims;
    Block 13, under Part II - Telephone Contact (see Fig. A), asks the 
veterans if they would like contact through phone or email with VA 
regarding their claim. There is no way for the veteran to indicate they 
would like to include any representative they might have, such as a 
service officer, involved in the contact. Due to the complexity of the 
disability claims process a veteran is far better served when there is 
someone present who understands and can explain the complexities of 
their individual claim, and knows what questions to ask and how to 
respond to questions from VA. Some improvement in this area would be to 
include representation for the veteran, which is in the best interest 
of the veteran.

[GRAPHIC] [TIFF OMITTED] T2236.001

    The second and perhaps most critical concern addresses Block 15C 
(see Fig B.) This block presses a number of questions to the veteran of 
a technical nature regarding their claim. It asks the veteran to 
provide specific details about their dissatisfaction with the decision, 
and section C requires them to assign a desired percentage evaluation 
for their disability.

[GRAPHIC] [TIFF OMITTED] T2236.002

    Veterans are not trained medical or legal personnel, and do not 
have access to the regulations or resources that ROs use to determine 
the different levels of disability rating. They are not necessarily 
qualified to provide this information, and could potentially damage 
their benefit sought on appeal due to a lack of legal knowledge. While 
a represented veteran is in a more expert position, it still places the 
veteran or service officer in the position of doing the VA's job of 
rating the claim. If a veteran only asks for one step up in rating from 
10 percent to 30 percent, when the case actually merits a 50 percent 
evaluation, will VA simply rate them at 30 percent and consider this 
``A FULL GRANT ON APPEAL''? As of now, this is unclear. Veterans are 
not expert in the complete corpus of veterans' law and benefits; they 
should not be required to provide information in the dark with the very 
real possibility of damaging their claim on appeal by providing bad 
information.
    On behalf of our National Commander James E. Koutz, the 2.4 million 
members of The American Legion we would like to thank this subcommittee 
for their diligent attention to the disability benefits process. 
Overall this initiative is a positive step forward for VA in addressing 
systemic problems in the benefits system. However, ensuring veterans 
are not impacted negatively by this is something that will bear close 
scrutiny over the coming months. The American Legion will be watching 
closely, and hopes to work closely with both VA and Congress to ensure 
the ultimate outcome is in the veterans' best interest.
    For any questions regarding this testimony please contact Ian de 
Planque, Deputy Legislative Director of The American Legion at (202) 
861-2700 or [email protected]

                                 
                                 AMVETS

Introduction
    Distinguished members of the Subcommittee on Disability Assistance 
& Memorial Affairs, it is my pleasure, on behalf of AMVETS, to offer 
this testimony on VA's recently announced initiative, which requires 
Regional Offices to process all claims pending for more than two years 
within 60 days of April 19, 2013.
    I would like to begin today by commending the committee for all of 
its work on behalf of American veterans everywhere, especially its 
efforts to improve efficiencies by eliminating redundant and/or 
counterproductive programs and its unwavering commitment to all of the 
men and women whose job it is to protect and defend this country.
    As the United States absorbs the aftereffects of more than a decade 
of continuous war and in the face of the planned draw-down of military 
personnel, the VA claims processing system has been, and will continue 
to be, severely stressed for the foreseeable future. Nothing is more 
important for our veterans than adequately meeting their physical/
mental health care needs and the accurate and efficient processing of 
their disability claims.
    Thanks to improvements in battlefield medicine, swift triage, 
aeromedical evacuations and trauma surgery, more combat-wounded than 
ever before are surviving horrific wounds and will be applying for the 
disability compensation they've earned on the battlefield. Your 
committee has a responsibility to ensure that the VA and our nation 
live up to the disability compensation obligations imposed by the 
sacrifices of our veterans.
    It is encouraging to acknowledge at this time that, despite the 
extraordinary sacrifices being asked of our men and women in uniform, 
the best and the brightest continue to step forward to answer the call 
of our nation in its time of need. I know that each of you is aware of 
and appreciates the numerous issues of importance facing our military 
members, veterans, retirees, families, and survivors; however this 
testimony will be, following these introductory remarks, limited to the 
VA's claims backlog initiative.
    For more than three years, the VA has been engaged in a 
comprehensive transformation process designed to convert the current 
claims processing system from an antiquated paper-based system to an 
electronic-based system. While early feedback on the new VBMS system 
appears to be somewhat mixed, not unusual when launching new systems, 
there seems to be sufficient merit to warrant our support. As VA 
continues to move forward with improvements and innovations, it is 
essential that Congress provide the resources necessary to complete the 
work at hand.
    There is certainly no shortage of problems plaguing VA's claims 
processing system, including:

      the unprecedented numbers of claims being filed;
      the failure of claims adjudicators to equitably and 
accurately decide claims the first time;
      the large number of appeals of claims decisions being 
filed;
      the VA's outdated and inefficient infrastructure; and
      the layer of middle managers entrenched within the VA who 
are not only un cooperative and unproductive, their lack of cooperation 
is actually undermining all of the good work that both Secretary 
Shinseki and General Hickey are attempting to accomplish.

    AMVETS is aware that there have been some within the VSO community 
who have practically demanded the resignations of both Sec. Shinseki 
and Gen. Hickey, but AMVETS is not among the naysayers. AMVETS fully 
supports both of these hard-working, dedicated, results-oriented, 
forward-thinking leaders and we believe that the cost (in lost 
productivity, etc) of eliminating them will be extremely detrimental to 
American Veterans everywhere. AMVETS does not believe that either Sec. 
Shinseki or Gen. Hickey is the problem; they are actually the best 
thing that has happened to the VA in decades. A better idea would be to 
get rid of the folks who are desperately clinging to `the old ways' and 
acting as road blocks to progress.
    Unfortunately, a tremendous amount of negative energy, especially 
from the media, is being focused on the claims backlog, which is merely 
a symptom of the much more endemic problem of reforming the claims 
processing system as a whole.
    AMVETS applauds the VA's ongoing efforts to streamline and improve, 
thereby shortening, the length of time it currently takes for veterans 
to receive decisions on their disability claims. The VA's recently 
announced initiative to provide provisional compensation decisions for 
the veterans who have waited the longest is an innovative, partial 
solution to the massive claims backlog problem. It's obvious that the 
same old ideas are not working and it's time to try something entirely 
new. If it's okay for our justice system to be based on the motto that 
one is ``innocent until proven guilty'' and if we file federal/state 
taxes and only a small percentage of folks get audited annually, then 
why not use a similar system of `presumption' to help our veterans get 
their claims processed more quickly?
    Though the idea may have merit and is certainly intriguing, 
questions remain to be answered, for example:

      what happens if a veteran is given a provisional rating 
and later that rating is either downgraded or the claim is denied 
altogether?
      who will be the judge of whether or not a claim is fully 
developed?
      should those who have claims based on service in Viet Nam 
or earlier conflicts be included in the `high priority' category?
      should victims of military sexual trauma be included in 
the `high priority' category?
      will forcing employees to work overtime to process this 
huge backlog of claims improve the accuracy of rating decisions?
      what happens if, through no fault of their own, a veteran 
is unable to provide the requested documentation?
      what will happen if an eligible veteran utilizes health 
and other VA benefits while their claim is pending or has a provisional 
rating and that claim is later denied?
      what kind of oversight will be provided?
      will accurate provisional ratings be incentivized?
      will private medical evidence be utilized during the 
decision making process?

    AMVETS will certainly be interested in monitoring the outcomes as 
implementation of this initiative moves forward.
    AMVETS offers the following recommendations as part of a holistic 
solution to the problems plaguing VA's claims processing system:

      that there be an increase in the quantity and quality of 
training provided to employees involved in the adjudication of claims;
      that all testing or skills certifications instruments be 
reviewed to ensure that they accurately measure the appropriate job 
skills;
      that VA continues to engage and utilize the expertise of 
its VSO partner organizations;
      resources must be equitably distributed between the 
various claims processing lanes; and finally
      Congress must ensure that the VA receives sufficient 
funding to appropriately implement its mandate to serve veterans.

    This completes my statement at this time; thank you for the 
opportunity to offer our remarks on this critical issue.

                                 
             VETERANS OF FOREIGN WARS OF THE UNITED STATES

    MR. CHAIRMAN AND MEMBERS OF THE COMMITTEE:
    On behalf of the men and women of the Veterans of Foreign Wars of 
the United States (VFW) and our Auxiliaries, I want to thank you for 
the opportunity to provide testimony for today's hearing.
    Over the last decade the Veterans Benefit Administration (VBA) 
disability claims workload has grown from 330,000 to nearly 905,000 
\1\. During the first six years that increase was a relatively modest 
60,000 claims. However, from early 2009 to the present, pending 
disability claims more than doubled.
---------------------------------------------------------------------------
    \1\ Monday Morning Workload Report, January 2003-January 2013; 
http://www.vba.va.gov/reports/mmwr/.
---------------------------------------------------------------------------
    Historically, VA tracked claims that were pending longer than 180 
days. From 2003 to 2009, claims pending over 180 days ranged from a low 
of 75,000 to a high of 108,625. In 2009, VA established a goal that no 
claim should pend more than 125 days. The lower number meant more 
claims exceeded the goal. In 2010, VA reported 179,863 disability 
claims pending over 125 days at the start of the year. By January 2013 
that number had tripled to over 630,000.
    The story told by this data is not new. In the last few years the 
volume of outrage from veterans, veterans' advocates and members of 
Congress has increased substantially. What was once an infrequent chant 
of disenchanted veterans of ``deny, deny until I die'' has been joined 
by many other voices demanding answers as to why VA cannot process 
claims more quickly than it currently does.
    During the last five years VA Secretary Eric Shinseki and VBA 
leaders, most recently Under Secretary for Benefits Allison Hickey, 
were able to identify many of the systemic problems which slow claims 
processing and put into motion historic changes in IT modernization 
which they believe will, over time, enable VA to process claims more 
quickly and with better quality. Unlike their predecessors they have a 
single vision and are dragging the second largest bureaucracy in the 
Federal government into the 21st Century. These are good things.
    However, while this long overdue transformation takes place, more 
and more veterans wait longer and longer for decisions from VA. 
Although VA made decisions in more than 1 million claims last year it 
was not enough to reverse the tsunami of claims it received. 
Inexorably, pending claims grew older and older, one day at a time. The 
media has been filled with story after story of veterans who had waited 
seemingly forever, frequently longer than a year. The number of 
veterans waiting two years or more seemed to explode overnight.
    With this as background, what was VBA to do? It did what it has 
always done; it decided to play a game of Whack-a-Mole. \2\ VA decided 
to shift its claims processing attention from methodically working all 
of its claims to concentrating on processing claims pending for more 
than two years. This reordering of priorities is not new, nor is it 
necessarily unreasonable in light of shifting workloads.
---------------------------------------------------------------------------
    \2\ Whack-a-Mole is one of those carnival games which can never be 
won, only played. It is usually a table with five or six holes. The 
head of a plastic mole protrudes from one hole. If you push down the 
head another pops up from different hole. The object of the game is to 
see how many moles you can whack with a mallet in a given time frame. 
The person who hits the highest number of moles wins the game.
---------------------------------------------------------------------------
    For instance, in August 2010 VA recognized three new conditions 
presumptively related to exposure to herbicides in Vietnam. VA 
leadership knew that they were faced with reviewing tens of thousands 
of claims previously filed by Vietnam veterans to see if they were 
entitled to benefits for one or more of the new presumptive conditions. 
This review was required in order to comply with Nehmer v. United 
States Department of Veterans Affairs \3\. VA could also reasonably 
anticipate receiving many more thousands of claims from Vietnam 
veterans. Faced with this certain dramatic spike in its workload and 
the relative simplicity of many of these claims, VA decided to shift 
its priorities to work Agent Orange claims ahead of pending claims.
---------------------------------------------------------------------------
    \3\ Nehmer v. United States Department of Veterans Affairs, No. CV-
86-6160 TEH (N.D. Cal.).
---------------------------------------------------------------------------
    In the end, VA processed 260,000 Agent Orange claims ahead of other 
pending claims. \4\ The very nature of this priority caused hundreds of 
thousands of other claims to grow months, perhaps years, older. VBA 
leaders are convinced that it was the right decision. Two-hundred-sixty 
thousand Vietnam veterans are receiving benefits today for conditions 
stemming from their war which ended 38 years ago. We can assume that 
most are satisfied with the actions taken by VA. This is what happens 
when priorities shift; a new set of claimants ``win'' while others wait 
longer.
---------------------------------------------------------------------------
    \4\ ``Balancing the Record on the Claims Backlog''; http://
www.blogs.va.gov/VAntage/8995/balancing-the-record-on-the-claims-
backlog/.
---------------------------------------------------------------------------
    The review of claims more than two years old is a change in 
priorities. \5\ It places virtually the entire claims backlog on hold 
until VBA finishes a review of more than 50,000 claims pending for more 
than two years. During this review, we are told, another 5,000 claims 
per month will turn more than two years old. After an interminable wait 
these veterans will receive decisions.
---------------------------------------------------------------------------
    \5\ VBA Letter 20-13-05 mandates a review of all claims received 
prior to July 1, 2011. Except for certain excluded pending claims, VA 
personnel are directed to rate all claims in this group based on the 
evidence of record. If development was complete at the time of review 
VA will make a decision using existing criteria and guidelines and 
provide appeal rights to the claimant. If development was not complete, 
but was not excluded from the project, VA will issue a ``provisional'' 
decision based on the evidence of record. This provisional decision 
does not become final for 1 year. During this period a claimant can 
submit additional evidence and receive a new decision based on the 
evidence of record. VA will notify the claimant that the decision is 
now final and provide appeal rights if no evidence is received within 1 
year of the issuance of a provisional rating,.
---------------------------------------------------------------------------
    VA states that about 30 percent of the 50,000 claims were ``ready 
to rate.'' That is, someone had indicated that all necessary 
development had been completed. These cases could have been worked at 
any time. Had regional office management paid attention to the workload 
reports, it should have assigned sufficient staff to process at least 
that segment of old claims. Judging from the fact that some regional 
offices had few claims subject to this review, it appears that some 
regional office managers managed their workload better than others.
    The remaining 70 percent of pending claims would fall into the 
following categories: Claims which should have been marked ``ready to 
rate'' but were not; claims which were awaiting records from Federal 
government agencies; claims waiting for a required VA medical 
examination; and claims waiting for records from private or non-Federal 
government sources. \6\ It is this last group of claims which, we 
believe, make up the largest segment of these old claims. Often, 
development is incomplete because of mistakes made by VA early in the 
processing of the claim.
---------------------------------------------------------------------------
    \6\ It is important to note that a small segment of claims grow old 
because of the difficulty in obtaining Federal government records in 
spite of timely efforts to obtain them. Claims from veterans who 
participated in nuclear bomb tests in the 1940-60's, for instance, are 
notorious for taking a long time to develop dosimetry readings from 
DOD, adjusted exposures and medical opinions.
---------------------------------------------------------------------------
    This project concerns us deeply. When the project was first 
proposed the VFW and other service organizations sought to create a 
dialog with VBA. VA adjusted the letter to address some of our 
concerns. However, the basic problem with this review is the creation 
of a new type of rating: A provisional rating. While VA has had great 
latitude in issuing interim ratings when it finds that evidence is 
sufficient to grant service connection or a higher evaluation even 
though additional development is required to fully adjudicate other 
issues, the idea of rating on the evidence of record before development 
is completed on that issue is new. It is also a disturbing departure 
from the law and past practice.
    For the record, the VFW welcomed the changes made by VBA in 
modifying this project. We told VBA leaders that we would not oppose 
this project as we consider it a one-of-a-kind event; that these 
veterans had waited too long to have their claims decided. VBA 
indicated that it wanted to expand this project to claims pending more 
than one year once the initial review was done.
    Given that VBA wanted to expand the review, we asked that it pause 
after this project to assess it to determine what problems were noted 
during the review; what action, if any, was taken to address those 
problems; what changes, if any, are necessary if the project was to be 
expanded to claims more than one year old; and what additional problems 
might develop by expanding this project.
    In our view, issuance of a provisional rating is an admission of 
failure; failure on the part of VA to accurately and completely develop 
an issue at the start of the claim. Examination of these cases will 
almost always show that VA performed incomplete development at the 
start, and failed to fully correct its mistakes and obtain required 
evidence in a timely manner. Most of these cases show signs of neglect. 
They sat for many months without any review by progressively more 
responsible and experienced VA employees.
    This project does more than simply bring these cases to the light 
of day to complete development and decide the issue at hand. With every 
provisional rating VA tells the veteran that VA failed to complete its 
job and now the burden of completing development is shifted to the 
veteran.
    In the end, VA will resolve nearly all of the 50,000 two-year-old 
claims it had pending at the start of this project. The average age of 
claims pending (ADP) will drop precipitously. VA will take a one-time 
hit in average days to complete (ADC) but this portion of the workload 
will no longer be a drag on the rest of the data. For a time VA will 
have significantly fewer cases pending over the artificial goal of 125 
days. However, without fixing its underlying problems of accurate, 
complete and timely development with rigorous attention to subsequent 
reviews and correction of any problems noted, timeliness will degrade 
and VA will slide backwards again.
    VBA leadership proposes to expand the more than two year review to 
claims more than one year old. There are several problems with this 
expansion. Any expansion beyond the current project institutionalizes 
the provisional rating. Further, it encourages some VA employees to 
accept, rather than correct, poor development. It encourages some 
managers to forego routine reviews to catch and correct mistakes in 
development because they will know that if a case ages past a certain 
point they can simply issue a provisional rating and shift remaining 
development to the veteran.
    Finally, the simple logistics of an expanded review become 
problematic. Consider that if it takes 60 days to review and decide 
50,000 claims, it would take another 8 months of concentrated, 
exclusive effort to review and process the estimated 200,000 claims 
pending for a year or more. In the meantime, virtually all of the 
existing work now less than one year old will age by another year. In 
the end, this project will not solve the backlog problem, it will only 
deprive thousands of veterans the assistance of VA mandated by law and 
regulation.
    Congress, through the Veterans Claims Assistance Act and other 
legislation, has instructed VA on the minimum it must do to assist 
veterans in the development and completion of their claims. We 
recognize that the legal burden for submitting evidence not in the 
control of the Federal government ultimately rests with the veteran. 
\7\ However, Congress decided that the burden does not shift until VA 
has completed certain actions. This project abrogates VA's 
responsibility to do the job Congress gave it.
---------------------------------------------------------------------------
    \7\ 7 38 CFR 3.159(e)(iv).
---------------------------------------------------------------------------
    This project is a very public admission that VA has failed to 
create a viable, effective and efficient system for developing and 
managing claims. Instead of fixing its problems, VA is demanding that 
veterans once again suck it up and shoulder the burden of completing 
the job that VA botched.
    We ask Congress to require VA to step up and perform the tasks it 
is required to do. We ask that Congress end the use of a provisional 
rating as it prematurely shifts the evidentiary development burden to 
veterans in contravention of existing law and regulations.
    Mr. Chairman, this concludes my testimony.
 Information Required by Rule XI2(g)(4) of the House of Representatives
    Pursuant to Rule XI2(g)(4) of the House of Representatives, VFW has 
not received any federal grants in Fiscal Year 2013, nor has it 
received any federal grants in the two previous Fiscal Years.

                                 
                TENNESSEE DEPARTMENT OF VETERANS AFFAIRS

    To answer the basic question that is before the House Committee on 
Veterans' Affairs, ``Expediting Claims or Exploiting Statistics?: An 
Examination of VA's Special Initiative to Process Rating Claims Pending 
Over Two Years,'' I would lean toward expediting claims more than two 
years old. If the VA's goal is to expedite those claims because of the 
time they have been waiting, as opposed to addressing the back log, I 
fully support that initiative but it does not come without a price. And 
unfortunately, the price is being paid by our Tennessee Veterans.
    The Nashville VA Regional Office (VARO) had approximately 110 
claims over two years old when this initiative started and was able to 
quickly address those. However, the VA has brokered in 1500 claims from 
the Los Angeles Regional Office for Nashville to rate. Since April 19 
Nashville has processed 841 claims from California, leaving 659 still 
pending processing. 1,740 local claims were processed during this same 
time period. They have stopped processing all TN Veterans claims, 
except for fully developed claims, as a result of having to process the 
claims that were brokered in. For every California claim our VARO has 
to process, a TN claim goes unprocessed, which will add to the backlog 
for our Tennessee Veterans. It has also caused a significant reduction 
in the number of local hearings they have been able to schedule for our 
TN Veterans.
    My Executive Staff and I have discussed the quality of the 
decisions for the over-two year old claims as well as whether or not 
they were being given full consideration, to include a compensation and 
pension exam, if necessary. We also looked at the overall production 
rate at the VARO to determine if they were processing an exceptionally 
high number of claims which would be an indication of rushing to a 
decision. From all that our Claims staff has observed, the VARO is 
doing due diligence and taking the time to rate these claims properly. 
The only negative impact they have observed is the delay it is causing 
for our TN Veterans.

                                 
                            ROBERT J. EPLEY

    This statement is provided in response to your staff E-mail request 
of May 14, 2013, asking me to provide a statement on the VA's 
initiative to expedite processing of rating claims pending over two 
years.
    Your request indicated you are interested in hearing views of 
organizations which may provide different perspectives on the 
implications of the VA initiative. I serve as a member of the Advisory 
Committee on Disability Compensation. This committee reviews matters 
relating to the VA Disability Compensation program and provides 
periodic reports to the Secretary and to your Committee.
    The history of the Advisory Committee on Disability Compensation is 
that its charter and initial instructions from the Secretary suggested 
focus on the adequacy of the VA Schedule of Rating Disabilities 
(VASRD), as well as matters relating to veteran's Quality of Life and 
transition from service to civilian life. The Committee has devoted the 
majority of its time to these issues, although the VA has recently 
asked that we review matters related to the claims backlog.
    The Committee has provided one interim report and two formal 
reports since its inception. Our most recent report, dated October 31, 
2012, discussed the need for timely and accurate claims resolution and 
offered six recommendations to improve workflow and processing time. 
These recommendations did not specifically address claims over two 
years old. The recommendations could, however, facilitate processing of 
aging claims. They are listed below:

      Set time expectations for each major step in the claims 
process to include: establishment of the claim; development of 
evidence; rating, and award authorization. These expectations should be 
consistent with the overall goal of 125 days.
      Require early and continuous claims management from 
filing to disposition.
      In addition to assigning claims to express, special 
operations or core lanes, triage all claims within 20 days of filing to 
award any part of the claim supported by the record; identify gaps in 
development and the records/exams needed to remedy the gaps; notify 
veterans and/or their representatives of information needed via a 
standard form.
      Seek out best practices in work flow management for 
claims and case management from subject matter experts with experience 
inside and outside VA.
      Standardize hearings by video conferencing to the maximum 
extent possible at the regional offices and exclusively at the BVA 
level.
      Establish centers of excellence for the processing of 
complex claims, e.g., PTSD and TBI.

    Our Advisory Committee has heard presentations from VA 
representatives, including the Under Secretary for Benefits, about the 
several ongoing initiatives to address the claims backlog and improve 
processing.
    The volume of VBA Compensation claims pending for lengthy periods 
of time is an extremely important issue and it has vexed the 
organization for some time.
    The VA has asked for, and received, authority to hire more claims 
examiners to work disability claims. They have solicited management 
ideas from outside and inside the organization; they are evaluating 
several suggestions to improve processing. They are actively working to 
improve the working relationship with DOD and other stakeholders. They 
are looking at technology to facilitate improvements. But for now at 
least, the backlog persists and grows.
    Examples of key management initiatives to improve processing and 
address the backlog are the Veterans Benefits Management System (VBMS), 
eBenefits, Disability Benefits Questionnaires (DBQs), and sorting 
Compensation claims into ``segmented lanes'' for more efficient 
processing. VBMS is intended to streamline the claims process primarily 
through a conversion to paperless processing. eBenefits will provide a 
portal for veterans and claimants to access their records and to submit 
evidence electronically. DBQs provide an electronic protocol that 
allows private physicians to conduct medical exams that will meet the 
VA's evidentiary needs. Segmented Lanes sorts the claims by type and 
complexity so they can receive more efficient handling.
    The initiative to expedite claims over two years old appears to be 
an overarching one. It will be intense and it is intended to be 
executed in the very near term. The VA directive on this initiative 
(referred to as a Special Initiative) is VBA Letter 20-13-05, dated 
April 19, 2013.
    In offering views on the VA Special Initiative, it is important to 
start by acknowledging that the goal to immediately review, decide, and 
complete all claims pending over two years is a laudable one. 
Certainly, those veterans who have been waiting for decisions for two 
years or more deserve immediate attention.
    The key components of the Special Initiative are:

      All Rating Veterans Service Representatives (RVSRs) and 
as many Veterans Service Representatives (VSRs) will be devoted to the 
project;
      All two year old cases are to be completed within 60 days 
(approximately June 18);
      Complete final rating decision if all necessary and 
pertinent evidence is on hand and the claim is considered ``ready to 
rate'';
      Issue a ``provisional'' rating decision where VA is still 
waiting for certain evidence - for these claims, Service Treatment 
Records, VA medical records, any evidence needed to establish Veteran 
status and/or pertinent service dates, and appropriate VA medical 
exams;
      No issues will be deferred;
      For provisional decisions, one year from the date of the 
decision, ROs will assess all claims and provide notice of a final 
decision to include appeal rights;
      For provisional decisions, no appeal rights will be 
provided to the claimant.

    The VA Special Initiative addresses a very important issue. It is 
also complicated. It has significant positive aspects, and it will have 
ramifications that may seem negative. I have listed some positive 
components, and some concerns about possible challenges and negative 
impacts below.

Positives--

      The veterans whose claims have been pending so long can 
begin to receive their entitled benefits. They certainly have medical 
and financial needs that have been challenged while they await claims 
decisions.
      Claims can become more complicated as they age; deciding 
these claims will have a positive effect on the overall workload.
      Addressing these critical claims on a priority basis 
demonstrates the VA's concern for those with potentially the greatest 
need, as well as the VA's commitment to reduce the overall backlog.
    Possible Concerns--
      If all RVSRs are devoted to the Special Initiative, then 
other claims will lay dormant for 60 days or more. It is likely that 
this additional aging will result in additional questions and concerns 
from the veterans who have filed these ``other'' claims. Responding to 
those questions will result in additional resource utilization being 
diverted from direct decision-making.
      The concept of a provisional rating decision may be 
confusing to veteran-recipients. Receipt of such a decision may trigger 
new, additional questions and concerns from the veteran-recipients. 
Issuance of final decisions wherever possible will be preferable.
      Since the Special Initiative involves some procedural 
changes from normal processing flow, there may be confusion among VSRs 
and RVSRs which results in processing variances.
      Provisional decisions executed under the Special 
Initiative will require a second review and promulgation of a final 
decision after one year has elapsed. This second review and decision 
constitutes ``new work''. It represents work and resource expenditure 
that would not be necessary without the Special Initiative. This could 
result in an overall reduction in claim decision output over the life 
of the initiative.
      Any special project involves adaptation of standard 
procedures. Execution of the Special Initiative needs to remain 
cognizant of the statutory and regulatory framework that guides the 
Compensation program. The Special Initiative must be executed within 
the existing statutory/regulatory framework so that decisions are not 
remanded or reversed through the appellate process.

    The concerns suggested above highlight how important it is that 
this Special Initiative be managed closely and vigorously. Clearly, it 
has been undertaken with the best of intentions, but good intentions 
are often subverted by poor execution. The Special Initiative will 
require close, constant communications within VBA and with the veteran 
community to avoid missteps. There should be a formal communications 
protocol developed to assure that all employees and stakeholders are 
kept up to date on Special Initiative developments.
    This special initiative responds to a situation similar to one VBA 
faced a decade ago when the repercussions of the Veterans Claims 
Assistance Act (VCAA) resulted in a large backlog. To address the 
oldest pending claims at that time, VBA created a special team called 
the ``Tiger Team'' in Cleveland to handle them. Rather than task all 
employees at each regional office to be involved, the aging claims were 
temporarily transferred to the Tiger Team for special handling. This 
approach could be resurrected to assist with today's generation of 
aging claims.
    As I mentioned above, VA is already working on several key 
management initiatives to help alleviate the backlog.
    All of these ongoing initiatives have merit and will add 
improvements to the Compensation claim process. Clearly, VA needs to 
extract itself from the current limitations that result from reliance 
on paper. An electronic process will bring many improvements. Also, 
providing an electronic portal for submission of claims, evidence, and 
tracking claim progress will be very beneficial. These enhancements 
will not, however, ``fix the backlog''. The Special Initiative on two 
year old claims will not either. Additional measures need to be 
implemented to strengthen the initiatives listed above, and to maximize 
their impact.
    I have outlined several areas below where additional measures 
should be taken to strengthen Compensation program management. The 
Advisory Committee on Disability Compensation has not discussed these 
areas in depth or agreed upon recommendations. The views below 
represent my thoughts.
    VBA needs to undertake additional measures that relate to more 
basic management functions that will provide the foundation for 
improved technology and improved communications with the veterans. 
These additional required improvement measures - Organizational 
Alignment, Ownership, Processing Team Improvements, and Accountability 
- will provide the foundation necessary to allow for reduction and 
control of the backlog.

Organizational Alignment.
    Clearly, the VA strives to provide veterans with high quality, 
equitable decisions on a timely basis. The likelihood of achieving 
these outcomes is greatly enhanced if everyone in the claims process 
understands how their role contributes to a successful outcome.
    Each position in the claims process (e.g., Development technician, 
VSR, RVSR, supervisor) needs to be structured to clearly focus on the 
core activity or activities that contribute directly to accurate, 
timely, professional decisions on disability compensation. The core 
activities need to be measured. The employees need to understand, and 
be regularly reminded, how their efforts fit into program outcomes. 
Positive achievements in their core activities need to be rewarded - 
regularly and publicly (conversely, poor performance must be identified 
and addressed quickly).
    It is important for each employee to understand how his work feeds 
into the overall process. No single individual guarantees a positive 
outcome; all employees are contributing; helping each other move toward 
a positive outcome. This implies that there should be regular 
communication among the different technical positions. A given function 
needs to know if they are providing the claims package to the next 
phase in a manner that optimizes that next step.

Ownership.
    VBA needs to build in ``ownership'' of the process. Historically, 
this has been a problem for VA. There has not been clear ownership of 
the entire process. But this process ownership must be established and 
it must resonate from well below the division level in the 
organization. VBA needs to ensure that processing teams own a claim 
from start to finish. These teams should include staff to do all phases 
of a claim: initial intake, triage, evidentiary development, rating 
evaluation, award authorization, and customer service. Each team should 
have direct links to VHA and DOD, as well as NSOs. These groups need to 
be vested in the success of the process.
    The role of management is critical to the success of the 
operations. Supervisory and managerial responsibilities need to be 
clearly defined; at the core of their work is managing the workflow, 
analyzing and correcting bottlenecks, and most importantly, managing 
the people. They are responsible for conveying the organizational 
message, recognizing quality performers and developing improvement 
plans for poor performers.
    At the same time, VBA needs to build in clear responsibility for 
monitoring the claims flow. This includes monitoring incoming work, and 
the number and age of claims pending in each step of the process. By 
doing this, the responsible manager (the traffic cop) can adjust work 
assignments, move work around, etc., to minimize any bottlenecks. This 
function requires a solid, sophisticated cycle time management system.
    The Segmented Lanes initiative seems to endorse this process 
ownership concept, and to the extent it does, that initiative deserves 
full support.

Processing Team Improvements, Priorities, Flexibility.
    There should be clear structure to the process, but there should 
also be flexibility built in to avoid unnecessary delays, and to 
properly handle unusual, problematic claims.
    The initial phase of the claim process must be strengthened. It is 
critical that claims receive an initial review quickly, that the review 
correctly identifies all claimed and inferred issues and evidence 
needed for an informed, equitable decision. The evidence gathering must 
start almost immediately. It currently takes about seven months on 
average to collect identified evidence. Within the existing regulatory 
and administrative constraints, this timeframe should be closer to 
three months with the introduction of improved efficiency and 
accountability measures.
    Claim flow needs to be revised to get the claims into the hands of 
senior technicians early in the process. The purpose of their review 
would be twofold: determine if ANY claimed conditions could be found 
service-connected, and clearly direct the action needed in order to 
make an informed decision. For conditions clearly related to service 
they would either rate the condition(s) or immediately schedule an exam 
to determine current disabling effects.
    Exam scheduling should be changed. If, at initial review, the 
senior technician finds that a VA exam is likely going to be needed, 
then the exam should be scheduled 45 - 60 days in the future. In that 
way, the evidence development can be completed coincident with the 
exam.
    Specialization should be considered (selectively) for types of 
claims that are difficult, complex, or time-consuming. (This is similar 
to VA's Segmented Lanes concept.) These difficult claims (for example, 
PTSD, Traumatic Brain Injury, or sexual trauma) should be handled 
exclusively by a special unit. That unit could develop close relations 
to stakeholder groups (medical providers, DOD, CURR, etc.) The special 
unit would own the claim for the veteran's lifetime. This would 
facilitate improved communications with the veteran. It would also help 
build in accountability that is lost when a special unit handles a 
claim on a ``one-time'' basis, then sends it back to a ``home'' office.

    After VA converts fully to electronic records, they could consider 
using specialized offices for ``referrals'' and expert analysis of 
esoteric issues. Such specialized offices would operate under unique 
accountability measures.

    Case management should be incorporated into the claims process. 
Just as specialization can help with complex categories of claims, case 
management can be an effective tool for individual claims that show 
difficulties or complexities. Sometimes, these claims need special 
handling and/or more personal communications with the claimant. Trust 
can be built, and roadblocks can be averted by more personal case 
handling. When individual claims are identified as unusual, difficult, 
or problematic, they would be assigned to a case manager. As with 
specialization, case management should be used selectively. It should 
not interrupt or overwhelm the basic team processing - it should 
complement that process. Case management activities should be 
incorporated into the standard processing teams to assure clear 
accountability.

Accountability.
    The Disability program's quality assurance process should be 
dramatically strengthened. The Compensation program has a national 
quality assurance program. It is useful for that purpose - Quality 
Assurance. Additionally, data from that process should be analyzed 
regularly to determine most persistent quality problems; root causes 
for those trends should be identified, and systemic corrections should 
be implemented to reduce the errors. In-process quality control reviews 
should be institutionalized. (VBA has instituted a process called 
Quality Review Teams - QRT - but these do not constitute in-process 
quality control; they are currently designed to sample and quantify 
individual employee performance). Data from these reviews could 
identify systemic and individual deficiencies, and lead to corrections 
that expedite the process.
    The Performance Management process needs to support and reinforce 
organizational alignment. VBA uses an extensive Performance Management 
System, but the system should undergo thorough review and revision to 
assure that performance measures reflect the core activities of each 
position in the process. If the positions have been constructed 
properly to focus on activities that build toward successful outcomes, 
then reward of positive completion of those core activities will 
incentivize actions which lead to successful outcomes. Each position 
should have performance measures focused around their core actions. The 
structure of each position, and its performance measures, should also 
relate clearly to the performance measures of the whole claims process, 
so they are clearly linked to their colleagues' performance in the 
process. By constructing performance measures this way, each employee 
will be rewarded for focusing on their core activities; completing 
those activities productively, accurately, timely, and professionally.
    The concepts I have outlined above are probably not comprehensive. 
Additional enhancements may be necessary to build an optimum claims 
process. But I believe each of these ideas can help improve the current 
process.
    Thank you for the opportunity to address these very important 
issues before your Committee. I greatly appreciate any opportunity to 
contribute to improved service to our veterans.

    Robert J. Epley


                                 
                IRAQ AND AFGHANISTAN VETERANS OF AMERICA

    Chairman Miller, Ranking Member Michuad, and Distinguished Members 
of the Committee:
    On behalf of Iraq and Afghanistan Veterans of America (IAVA), I 
would like to extend our gratitude for this opportunity to share with 
you our views regarding the topic of today's hearing on ``Expediting 
Claims or Exploiting Statistics?: An Examination of VA's Special 
Initiative to Process Rating Claims Over Two Years.''
    IAVA is the nation's first and largest nonprofit, nonpartisan 
organization for veterans of the wars in Iraq and Afghanistan and their 
supporters. Founded in 2004, our mission is important but simple - to 
improve the lives of Iraq and Afghanistan veterans and their families. 
With a steadily growing base of over 200,000 members and supporters, we 
strive to help create a society that honors and supports veterans of 
all generations.
    On April 19, 2013, the Department of Veterans Affairs (VA) 
announced that it would be promptly implementing a new initiative 
intended to expedite disability compensation cases in which the 
claimant has been waiting for more than one year for a rating decision. 
This, as we understood it, would be accomplished by providing 
provisional ratings based on available probative evidence within a 
veteran's file and allowing that veteran up to one year to submit 
additional evidence and receive an increased rating decision based on 
the additional evidence added to his or her file within that period.
    IAVA, like many other veteran and military service organizations as 
well as this Committee and its Senate counterpart, was initially 
surprised to learn of this new initiative. We were simultaneously 
perplexed as to why it had not been instituted previously and hopeful 
that it would prove to be a change for the better in how the VA handles 
seriously delayed disability claims decisions. However, at just beyond 
the half way point of the initial time period set out by the VA for the 
first phase of this new initiative, it remains too early for outside 
advocacy, service, and watchdog organizations to assess the wisdom, 
authenticity, and impact of this special claims processing initiative.
    Our initial impression of this new initiative was that it would 
include cases pend for more than one year and that the 60-day time 
period laid out by the VA for carrying out this initiative would apply 
to that entire batch of cases. This would have been a promising, albeit 
admittedly challenging, scenario indeed, but one to which it at first 
appeared the VA had committed itself. However, it soon became clear 
that the VA was quickly unlinking the initial batch of cases it had 
touted as falling within the new initiative (i.e., those pending for 
one year or more) from the time period that it had touted as tied to 
the new initiative (i.e., 60 days). Now, it seems, the VA plans to only 
tackle cases pending for more than two years within that first 60-day 
window and then subsequently tackle one-plus year cases over a yet-to-
be-specified period of time. While this is certainly a positive 
development for veterans whose claims have been pending for egregiously 
lengthy periods, it is hardly the sweeping initiative that we were all 
initially led to believe was being undertaken by the VA to 
significantly reduce the disability claims backlog in a short amount of 
time.
    In taking on the commitment of this special claims processing 
initiative, the VA warned that some new claims may become backlogged 
that may not have otherwise become backlogged because of the new focus 
on older claims at the expense of newer claims. The VA also warned that 
the backlog might temporarily get worse before it got better as a 
result of this new initiative. However, it appears that the backlog has 
steadily decreased by a somewhat healthy margin over the several weeks 
preceding this hearing. If this pace continues, then the VA's 
predictions about the backlog worsening as a result of this special 
initiative may prove to be unfounded.
    If this is the case, and there is no decrease in progress as a 
result of this special initiative, then the VA is certainly due credit 
for succeeding in at least one efficiency improvement related to 
backlog claims processing and management. This is important because 
most of the VA's stated backlog solutions have centered around 
technological improvements and advances that would primarily help with 
future filed claims and would not directly impact the current backlog 
of paper-based claims that are the subject of great public and 
congressional concern. For this reason, the VA needs more focus on 
backlogged paper-based claims and less on pivoting and redirect to 
talking points about how it will prevent recurrences and future 
resurgences of the backlog or how it will address future disability 
claims.
    While the VA's technological improvements are not the most advanced 
or sophisticated compared to similar technology used in private 
industry and in other parts of government, they are nevertheless 
improvements. But what the VA needs to address more thoroughly is what 
it is going to do to tackle the current backlog of paper-based claims. 
This special claims processing initiative appears promising on the 
surface, despite what appears to have been a shifting goal post in the 
beginning of the game. However, what this Committee will need most in 
order to fully evaluate this initiative as well as the VA's overall 
performance is data, information, and communication, all of which the 
VA has been less than forthcoming with at times.
    For many, the claims backlog is about numbers and metrics. For 
others, it may be about politics and accountability. But for IAVA, the 
claims backlog is about real lives, real people, and real members of 
our organization who have paid their dues to our nation and sacrificed 
their health in its defense, but who are now waiting for that nation to 
fulfill its promise to care for those who have borne the battle, to 
paraphrase President Lincoln and the VA's own mission statement. For 
IAVA, the problem has a human face and a real voice, like that of IAVA 
member Rachel McNeil, who joined the Army Reserves in 2002 and deployed 
to Iraq in December of 2004. Rachel filed a claim after she came home 
from Iraq in 2006, and had been more than 827 days since the VA even 
acknowledged that she filed a notice of disagreement with their 
decision in 2010.
    IAVA member John Wypyszinski spent 16 years in the military in both 
the Army and the Navy as a nuclear, biological, and chemical operations 
specialist, and later
    as a medic and a hospital corpsman with the Marines. He deployed 
twice to Iraq before he was medically retired in 2007 due to injuries, 
but he was lost in the VA disability claims process for an excruciating 
963 days. And then there's IAVA member Luis Cardenas Camacho, who 
served in the Marine Corps from 2004-2008 and deployed to Iraq three 
times. Upon returning home, Luis found himself fighting new enemies, 
including PTSD, depression, and his physical injuries. Luis has been 
dealing with the VA disability claims office for five years and still 
hasn't received his benefits.
    It is stories like these - the real stories and real lives of real 
heroes - that motivate us here at IAVA, that fuel our outrage at the 
slow pace of progress on the backlog, that exacerbate our impatience 
sometimes with the Veterans Benefits Administration (VBA), and that 
make us wary of surprise ``special initiatives'' to address the backlog 
in ways that seemingly could have been utilized all along. For us, and 
for other outside advocacy and service organizations, it is difficult 
to diagnose problems, provide solutions, and assess impact without 
access and data, just as it would be impossible for a mechanic to 
assess and fix an engine problem without being able to look under the 
hood or for a doctor to diagnose and treat a patient without being 
permitted to see or talk to that patient. It is our hope that though 
this hearing, as well as through continued aggressive oversight and 
inquiry on the part of this Committee, substantive answers to the 
question that is the topic of this hearing can be ascertained.
    We again appreciate the opportunity to offer our views on this 
important topic, and we look forward to continuing to work with each of 
you, your staff, and this Committee to improve the lives of veterans 
and their families. Thank you for your time and attention.

                                 
                    DISABLED AMERICAN VETERANS (DAV)

    Chairman Miller and Ranking Member Michaud:
    Thank you for inviting DAV (Disabled American Veterans) to submit 
testimony for today's hearing examining the Department of Veterans 
Affairs (VA) new initiative to expedite compensation claims decisions 
for veterans who have been waiting one year or longer. As the nation's 
leading veterans service organization (VSO) assisting veterans seeking 
disability compensation and other benefits, DAV has tremendous 
experience and expertise relating to the processing of claims. With a 
corps of 270 full-time professional National Service Officers (NSOs) 
and 35 Transition Service Officers, DAV assists almost a quarter of all 
veterans who file claims for disability compensation each year.
    Under this new program, VA is focusing its efforts on the oldest 
claims pending and will make decisions based upon the evidence that has 
already been received, even if there is identified evidence that has 
not yet been obtained. If a current medical evaluation is required for 
a rating decision, VA will seek to provide an expedited exam. These 
claims would then receive provisional ratings with benefits awarded 
retroactively to the original date of claim. Although this program was 
originally intended to focus on claims that were pending more than two 
years, it was launched on a larger scale by expanding its target to all 
claims pending more than one year.
    Provisional rating decisions are required to specify what evidence 
was used to make the rating decision and also list any evidence or 
documentation that has not yet been provided to VA or that VA has been 
unable to obtain. The veteran would then have up to one year to submit 
additional evidence or to request that VA obtain new evidence that the 
veteran identifies. If at the end of the one-year period, the veteran 
has not provided any additional evidence nor requested that VA seek to 
obtain additional evidence, the provisional rating decision would 
become final. Once the rating decision becomes final the veteran has 
the standard one-year period in which to file an appeal. Provisional 
rating decisions, however, are not appealable, although the veteran can 
request that the provisional decision become final prior to the end of 
the one-year period and then file an appeal thereafter.
    Mr. Chairman, VA's intention for initiating the provisional rating 
program is to expedite decisions for those veterans who have been 
waiting the longest and we certainly agree that these veterans deserve 
a decision. We are very aware that some claims sit on shelves for years 
awaiting evidence that may or may not make a difference in the final 
rating decision, and agree that in some cases, a provisional decision 
could at least provide partial benefits while further evidence is 
sought that may increase the rating assigned. As such, we do not oppose 
VA's provisional rating initiative at this time. However we do want to 
be certain that VA will not be making provisional decisions when they 
could be making normal rating decisions with little or no additional 
development. Furthermore, we also need to be certain provisional 
ratings do not become an excuse for simply denying veterans' claims as 
a means to lower the number of pending claims.
    For these reasons, it is imperative that VA be extremely open, 
transparent and forthcoming with information and results on a regular 
basis so that we can ensure that provisional ratings benefit veterans. 
We applaud this Committee for conducting today's oversight hearing and 
we would offer several areas of inquiry that we hope you will address.
    It has now been more than four weeks since the provisional rating 
program was begun and VA has not yet publicly released any data about 
the number of provisional rating decisions completed. Such data should 
be broken down in as many useful categories as possible, starting with 
the number of provisional decisions that granted benefits and the 
number that denied benefits. How do the allowance rates for these 
provisional decisions compare to that for normal rating decisions? We 
would hope that such information is forthcoming by the time of this 
hearing and that it will then continue to be publicly released on a 
regular basis, weekly if at all possible, so that we and other veterans 
advocates, as well as Congress, can properly evaluate and oversee this 
program.
    We would also like to review all of the directives and directions 
provided by VA to its Regional Offices, including any training 
materials related to this program, in order to increase our confidence 
in this program. In addition, we want to examine actual provisional 
decisions to ensure that they are properly listing the evidence that is 
missing or has not yet been obtained, crucial information for veterans 
deciding whether to accept a provisional rating or to appeal a final 
rating decision.
    We want to analyze the changing performance metrics used by VA to 
measure progress on claims processing. In announcing this initiative, 
VA indicated that several standard measurements would begin to 
fluctuate as older claims were resolved. Specifically, the Average Days 
Pending for claims would be expected to decrease as the oldest claims 
on the books are removed. However, the Average Days to Complete a claim 
would be expected to increase as the longest pending claims would now 
become part of that metric. VA should provide weekly updates to 
determine if these metrics do shift as anticipated. In addition, VA 
should provide weekly updates on measurements of accuracy for 
provisional ratings, as well as analysis of how this initiative is 
affecting the overall number of claims completed and the number of 
claims pending. Until we have sufficient information and data about the 
provisional rating initiative, we will be unable to determine if it is 
operating as intended, whether it merits continuation or whether it 
needs to be adjusted or ended.
    Finally, we would like to encourage Congress and VA to seek other 
ways to rapidly award partial or temporary benefits to disabled 
veterans when the evidence of record clearly supports such awards. VA 
currently has the authority under 38 Code of Federal Regulations, 
section 4.28, to issue prestabilization ratings for veterans who are 
discharged from active duty due to severe injuries or illnesses that 
are not yet fully stabilized or healed, and which cause significant 
limitations in their ability to be employed. VA also has rules to award 
intermediate rating decisions with deferred issues as discussed in M21-
1MR, Part II, Subpart iv, Chapter 6, Section A. Intermediate rating 
decisions for multi-issue claims can be made when the record contains 
sufficient evidence to decide some of the claimed issues, including 
service connection, even though remaining issues require further 
development, and will be deferred. Although VA has had these 
authorities for a number of years, VA rarely takes advantage of them to 
provide at least partial or minimum benefits to veterans on an 
expedited basis. DAV believes that both prestabilization and 
intermediate ratings should be encouraged and expanded to apply to 
additional circumstances.
    We also believe that a new ``temporary minimum rating'' for claims 
in which the evidence of record is already sufficient to support at 
least a minimum 30 percent service-connected disability rating would 
provide a tremendous benefit to many veterans. Similar to intermediate 
ratings, these ``temporary minimum'' ratings should not slow or impede 
the regular development and processing of the rest of the claim. With 
the adoption of paperless e-folders and smart processing, temporary 
ratings could be easily accomplished without the risk of ``double 
work'' by VA. Although these temporary rating authorities would not 
directly reduce VBA's workload or the backlog, providing a rapid award 
of at least some benefits, based on the available records, to disabled 
veterans would increase overall confidence in the claims process, and 
likely help to reduce the number of appeals filed by claimants. Most 
importantly, these changes would expedite much-needed assistance into 
the hands of veterans and their families during difficult transitions 
and recoveries.
    Mr. Chairman, throughout VA's transformation process, we have 
maintained that the most important result must be to create a system 
designed to decide each claim right the first time. Whether the use of 
provisional ratings should become a permanent part of VA's future 
claims processing system remains an open question until we have 
sufficient results demonstrating its merit. While we understand the 
importance of reducing the backlog of pending claims, it does little 
good to lower that number by making bad decisions that are incomplete 
or inaccurate, leading to appeals and re-filed claims. VA must remain 
focused on completing the transformation process currently underway so 
that they can both reduce the pending workload, as well as be prepared 
to handle the future workload. In conclusion, we urge this Committee to 
continue supporting VA claims transformation process while also 
continuing to conduct regular and comprehensive oversight.

                                 
                        BERGMANN AND MOORE, LLC

Introduction
    We thank Chairman Jeff Miller and Ranking Member Mike Michaud for 
the opportunity to present a statement for the record regarding plans 
by the Department of Veterans Affairs (VA) to focus on adjudicating 
Veterans' disability compensation claims aged 730 days or more and now 
pending at the Veterans Benefits Administration (VBA).
    Bergmann & Moore, LLC, is a Bethesda, Maryland law firm 
representing the appeals of Veterans before VA and the U.S. Court of 
Appeals for Veterans Claims (CAVC). The firm's partners and several 
associates previously worked for VA. We have a strong interest in 
ensuring VA processes disability claims in a timely and accurate manner 
for our Veterans as well as their surviving family members.
    A brief review of recent events prior to this hearing is vital in 
order to understand why this issue is important to our nation's 
Veterans and families.
    On March 11, 2013, reporter Aaron Glantz at the Center for 
Investigative Reporting (CIR) published a news article revealing a 
tremendous increase in the number of claims pending at VBA for one year 
or longer.
    CIR reported the number of claims in that category rose sharply, 
from less than 11,000 at the end of Fiscal Year 2009 to nearly 245,000 
at the end of December 2012 (``VA's ability to quickly provide benefits 
plummets under Obama,'' Center for Investigative Reporting, March 11, 
2013).
    We thank Congress for holding this hearing focusing on the 
implications of Fast Letter 20-13-05, ``Guidance Regarding Special 
Initiative to Process Rating Claims Pending Over Two Years,'' issued by 
VBA on April 19, 2013.
    In VBA's Fast Letter, VBA staff are instructed to identify and rate 
disability compensation claims pending two years or longer. Under 
Secretary for Benefits Allison A. Hickey, VBA's top official, ordered 
that VBA Regional Offices `` . . . will devote all [Rating Veterans 
Service Representatives] and as many [Veterans Service Representatives] 
as are needed to ensure that all two-year old claims are processed 
within 60 days from the date of this letter.''
    The same day, Chairman Miller issued a statement regarding VBA's 
new policy.

    While this new approach sounds promising, we will be monitoring it 
closely to make sure it's good policy rather than just good PR. Driving 
our skepticism is the fact that Sec. Shinseki and VA benefits officials 
have testified before our committee several times in just the last few 
weeks, yet the first official notice of this initiative didn't come 
until today - minutes before VA issued its press release.

    A few days later, the Committee announced today's hearing, which is 
titled, ``Expediting Claims or Exploiting Statistics?: An Examination 
of VA's Special Initiative to Process Rating Claims Pending Over Two 
Years.''

Four Significant Concerns
    In addition to agreeing with Chairman Miller's statement and the 
urgent need for this oversight hearing, Bergmann & Moore raises four 
significant concerns about VBA's new policy.

  1. VBA's Fast Letter Conspicuously Ignores Veterans' Appealed Claims 
        Remanded Back to VBA.
    We are troubled that VBA's Fast Letter is silent on the issue of 
appealed claims remanded back to VBA Regional Offices and still 
awaiting final adjudication. These are claims that Veterans or 
surviving beneficiaries filed many years ago - in some cases more than 
a decade - that have been returned from either the Board of Veterans' 
Appeals (Board) or the Court of Appeals for Veterans Claims (Court). 
The appealed claims were remanded following an acknowledgment or 
directive for either additional development - because of incomplete 
development in the past - or other specific actions for VBA to complete 
prior to final adjudication.
    The most tragic statistic this hearing should focus on is a fact 
reported by CIR: as many as 53 Veterans die each day waiting on a VBA 
claim decision. We have experienced this tragedy many times with our 
clients over the years. We can vouch for the fact that Veterans with 
strong cases, who would very likely have won substantial benefits if VA 
had adjudicated their claims, died waiting.
    The exact number of claims languishing at VBA after a remand from 
the Board or Court remains unknown, as VBA does not appear to 
specifically account for them. The length of time VBA takes to 
adjudicate these claims is also unknown. From our experience with 
assisting thousands of Veterans, we know appealed claims often take 
years for VBA Regional Offices to adjudicate.
    Moreover, VBA employees who work at various VBA regional offices 
have told us multiple times in recent years that substantial delays in 
appealed cases are being caused by VBA pulling resources away from 
appeals in order to make its numbers regarding initial claims look good 
for Congress. We have no way to independently verify these statements, 
but they are so widespread as to be ubiquitous, and they seem to be 
corroborated by VBA's inattention to appeals in Fast Letter 20-13-05.
    VBA's silence on appealed claims is disappointing and distressing 
to Veterans because the law already mandates that VBA provide 
``expedited'' treatment for appealed claims remanded by the Board and 
Court (38 USC 7112). Under the new Fast Letter, VBA acts as if appealed 
claims don't exist and that VBA may continue ignoring existing law.

  2. VBA Did Not Provide for Notice and Comment.
    We are concerned that VBA's Fast Letter established a new process 
that should be promulgated through the regulatory process, i.e., 
through notice and comment in the Federal Register. Specifically, the 
provisional decision process removes appellate rights from the decision 
and places the claim in a one-year limbo period. For example, if VA 
provisionally grants a 0 (zero) percent rating this decision will stand 
for one year prior to it becoming final upon which the Veteran can then 
appeal. Thus, VBA appears to have created a new set of procedures 
without informing and then allowing input from vital stakeholders and 
the public, as required by law.

  3. The Fast Letter Exalts Speed Over Quality and Will Likely Result 
        in Additional Delay for Veterans.
    Third, VBA's Fast Letter emphasizes speed by mandating completion 
of older claims within 60 days. However, the Fast Letter mentions 
``quality'' only once. We are very concerned about VBA's new policy 
because VBA staff are already under tremendous pressure to quickly 
decide claims, and we expect VBA to make more mistakes with VBA's 
arbitrary deadline to adjudicate all identified claims within 60 days.
    Evidence of additional pressure is VBA's nationwide use of 
mandatory overtime announced on May 15, 2013. VBA has used overtime in 
the past, yet VBA claim inventory was only temporarily reduced. We are 
concerned about VBA's existing poor quality claim decisions, and we 
believe VBA's additional unrealistic time constraints will exacerbate 
VBA's unconscionable number of mistakes as well as potentially place 
more strain on already overworked VBA staff
    VBA's frequent errors include a failure to properly develop 
evidence, improper denials for service connection, low ratings, and a 
failure to pay retroactive benefits. In this specific circumstance, we 
are concerned VBA will issue provisional ratings that are artificially 
low in an attempt to clear the decks of cases pending two years or 
longer.
    Per the Fast Letter, these decisions will then sit for one year 
during which an appeal process is not contemplated, pending VA's final 
assessment (pending ``additional guidance in the future regarding 
procedures for the review of [these] cases after the one-year period 
has ended'' (page 3, emphasis added).
    Only after the one year period expires will the Veteran be notified 
that the claim has become final and be provided appellate rights. 
Veterans will then be forced into a new (and presumably overcrowded) 
waiting line in order to pursue their claims further with a timely 
appeal.
    It must be noted that the Fast Letter provides a process to obtain 
a ``final decision with appeal rights before the one-year provisional 
period ends.'' In order to avail oneself to this process, however, the 
Veteran is required to send VA a signed statement containing the 
following quoted language: ``All necessary evidence was considered by 
VA. I request that this provisional decision be made final'' (page 4).
    We are strongly dismayed that a Veteran is required to make this 
acknowledgement in order to bypass the one-year waiting period.
    VBA's own error statistics (which we view as extremely low given 
our experience reviewing VA decisions over the years) validate our 
concerns. According to VBA's ``ASPIRE'' web site, as of March 2013, 
VBA's error rate was an unacceptable 13.3 percent. VBA's national goal 
is two percent. Therefore, VBA's reporting of VBA's error rate is more 
than six times VBA's national goal.
    In June 2012, VA's Office of the Inspector General (OIG) testified 
before this Committee that VBA made errors in 30 percent of high-risk 
claims, or 15 times higher than VBA's goal. We find OIG's error rate 
far more credible because it is independent and nationwide over a 
period of four years.
    We urge Congress to ensure that an objective review of VBA's 
performance is set up. We recommend the Government Accountability 
Office or VA's OIG audit a random sample of claims completed under 
VBA's new Fast Letter to monitor and report on this new process, 
including accuracy, timeliness, training, staffing, and the impact on 
other pending claims, including those on appeal.

  4. Mixed Messages from VBA and VA's Office of Public Affairs
    When the Department unveiled the new policy, VA sent mixed messages 
to Veterans, service organizations, advocates, and the public on this 
important issue. The confusion began when VBA and VA's Office of Public 
Affairs described two different target groups for expedited claim 
processing.
    The title of VBA's April 19, 2013, Fast Letter is, ``Guidance 
Regarding Special Initiative to Process Rating Claims Pending Over Two 
Years'' (emphasis added). In sharp contrast, a VA Public Affairs office 
press release issued the same day focuses on a different and much 
larger population: ``The Department of Veterans Affairs announced today 
it is implementing an initiative to expedite compensation claims 
decisions for Veterans who have waited one year or longer'' (emphasis 
added).
    By constantly moving the goal posts, VBA makes objective 
measurements of their performance difficult. We urge Congress to end 
the confusion sown by VBA and VA by establishing a clear set of 
measurements and then holding agency leaders to those goals.
The Bottom Line
    Timeliness and accuracy remain the bottom line measurements of VBA 
performance for older, unadjudicated claims. At the end of March 2013, 
before VBA announced the new policy of adjudicating claims pending two 
years or longer, the average number of days to complete a claim was 
291.5 days. As of May 13, 2013, the average number of days rose sharply 
to 338.4 days. That's a 16 percent increase in less than two months.
    In Los Angeles, California, VBA's average time to complete a 
Veteran's disability claim is a staggering and outrageous 588.5 days, 
or nearly 20 months.
    In conclusion, VBA's claim delay and error crisis appear to be 
worsening. We believe VBA should either abandon this ill-conceived 
``special initiative'' or revise it to ensure that the claims of 
provisionally-rated Veterans are not held hostage for a year or longer 
pending a final, appealable decision. Additionally, VBA must be closely 
monitored by an agency outside VBA to ensure the process serves a 
beneficial purpose by improving accuracy and timeliness.
    We respectfully ask Congress to consider the following four steps:

      1. Confront VBA on the obvious danger that VBA will 
provisionally rate claims artificially low, thus depriving Veterans of 
compensation.
      2. Confront VBA on the lack of due process for Veterans 
who are not satisfied with VBA's provisional rating, yet are not 
provided with appellate rights for one year so the Veterans may 
continue to pursue their claims.
      3. Order VBA to provide monthly statistics about the 
number, age (in days), and RO location of all appealed claims on remand 
now pending at VBA, to include the results of this ``special 
initiative.''
      4. Order VBA to immediately produce and promptly execute 
an action plan to timely and accurately complete these appealed claims, 
including those on remand from the Court and Board, that are waiting 
years, and in some cases decades.

    We continue looking forward to working with the House Veterans' 
Affairs Committee so our Veterans receive accurate and timely decisions 
to their VA disability claim applications and appeals.
    Too many Veterans died waiting on a decision from VBA, especially 
Veterans waiting for a decision on an appealed claim; nearly 20,000 
during Fiscal Year 2012, according to CIR's reporting. The situation is 
intolerable, and we encourage Congress to take action.
    We are concerned that VBA's new policy is little more than a public 
relations effort to cast a shadow on the recently exposed and 
unacceptably long delays in adjudication. Without oversight, additional 
staffing, and training, we believe VBA's Fast Letter will cause more 
problems for Veterans and will ultimately backfire.

                                 
                        Question For The Record
                Question From: Chairman Miller, To: VBA

    At HVAC May 22nd hearing to review the VA's initiative to expedite 
processing of oldest claims in the backlog, Chairman Miller asked USB 
Hickey, ``We are at a point now where the Secretary had said back in 
2010 that we would be at a point that we'd be processing claims at 160 
days?'' USB Hickey responded that she would research the data and 
provide a response. The following is USB Hickey's response:

    In the FY 2012 budget request (developed in 2010), VBA set ADC 
targets of 158 days for FY 2011 and 148 days for FY 2012. However, VBA 
also noted in the budget submission that due to the complexity of the 
readjudication of the previously denied Agent Orange claims, as well as 
the overall increased volume of workload, inventory was projected to 
increase from 2010 through 2012. The complexity of the overall workload 
was also projected to continue increasing, as more Veterans filed for a 
greater number of disabilities, including conditions such as PTSD, 
combat injuries, diabetes, and diseases associated with environmental 
hazards.
    VBA received 230,000 Agent Orange claims in FY 2011, including 
93,000 claims requiring readjudication under the Nehmer settlement. The 
complexity of completing the 230,000 presumptive Agent Orange claims 
required more resources over a greater period of time than VA initially 
anticipated. Completing the Agent Orange/Nehmer claims required 
approximately one-third of VBA's rating capacity, including all 
thirteen day-one-brokering-centers (D1BCs), which were dedicated 
exclusively to the Nehmer readjudication, as well as rating resources 
in all 56 regional offices. These resources were dedicated to Nehmer/AO 
from October 2010 through April 2012.
    While VBA completed more than one million claims for the second 
consecutive year in FY 2011, receipts of 1.3 million claims exceeded 
production, causing VBA's inventory of claims to grow and become older. 
From the end of FY 2010 (when VBA began working the new Agent Orange 
claims), through the end of FY 2011, VBA's inventory increased from 
531,698 claims to 810,455 claims, or by 52 percent. VBA's backlog, 
which includes claims pending over 125 days, increased from 34 percent 
at the end of FY 2010 to 60 percent at the end of FY 2011.
    In FY 2012, VBA completed more than one million claims for the 
third consecutive year, and VBA is on track to complete more than one 
million claims again in FY 2013. However, due to the age of the overall 
inventory, average days to complete (ADC) increased as the oldest 
claims in the inventory continue to be prioritized. VBA is currently 
executing an initiative that initially focused on completing all claims 
pending over two years by the end of June 2013. As VBA completed these 
older claims, ADC increased. However, since VBA began this initiative 
on April 19, 2013, the average days pending (ADP), meaning the average 
wait time for Veterans with current pending claims, has decreased.
    VBA has completed approximately 22,000 more claims than we received 
this fiscal year. As the number of claims completed continues to exceed 
claims received and we complete the initiative to complete claims for 
Veterans waiting the longest, ADC will continue to decrease.

                                 
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