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




 
             IMPLEMENTATION UPDATE: FULLY DEVELOPED CLAIMS

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

                                HEARING

                               before the

       SUBCOMMITTEE ON DISABILITY ASSISTANCE AND MEMORIAL AFFAIRS

                                 of the

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

                    ONE HUNDRED THIRTEENTH CONGRESS

                             FIRST SESSION

                               __________

                     WEDNESDAY, SEPTEMBER 11, 2013

                               __________

                           Serial No. 113-34

                               __________

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

            Helen W. Tolar, Staff Director and Chief Counsel

                                 ______

       SUBCOMMITTEE ON DISABILITY ASSISTANCE AND MEMORIAL AFFAIRS

                    JON RUNYAN, New Jersey, Chairman

DOUG LAMBORN, Colorado               DINA TITUS, Nevada, Ranking 
GUS M. BILIRAKIS, Florida            Minority Member
MARK AMODEI, Nevada                  BETO O'ROURKE, Texas
PAUL COOK, California                RAUL RUIZ, California
                                     GLORIA NEGRETE MCLEOD, California

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


                            C O N T E N T S

                               __________

                           September 11, 2013

                                                                   Page

Implementation Update: Fully Developed Claims....................     1

                           OPENING STATEMENTS

Hon. Jon Runyan, Chairman, Disability Assistance and Memorial 
  Affairs........................................................     1
    Prepared Statement of Hon. Runyan............................    25
Hon. Dina Titus, Ranking Minority Member, Subcommittee on 
  Disability Assistance and Memorial Affairs.....................     2
    Prepared Statement of Hon. Titus.............................    26

                               WITNESSES

Thomas Murphy, Director, Compensation Service, Veterans Benefits 
  Administration, U.S. Department of Veterans Affairs............     3
    Prepared Statement of Mr. Murphy.............................    26
Verna Jones, Director, Veterans Affairs and Rehabilitation 
  Commission, The American Legion................................    13
    Prepared Statement of Ms. Jones..............................    29
Steven T. Wolf, Assistant National Service Director, Disabled 
  American Veterans..............................................    14
    Prepared Statement of Mr. Wolf...............................    32
Diane M. Zumatto, National Legislative Director, AMVETS..........    16
    Prepared Statement of Ms. Zumatto............................    37
W. Clyde Marsh, President, National Association of State 
  Directors of Veterans Affairs..................................    17
    Prepared Statement of Mr. Marsh..............................    43

                       STATEMENTS FOR THE RECORD

Paralyzed Veterans of America....................................    45
Veterans of Foreign Wars.........................................    48

                        QUESTIONS FOR THE RECORD

AMVETS Responses to Hearing Questions............................    50


             IMPLEMENTATION UPDATE: FULLY DEVELOPED CLAIMS

                     Wednesday, September 11, 2013

             U.S. House of Representatives,
                    Committee on Veterans' Affairs,
                      Subcommittee on Disability Assistance
                                      and Memorial Affairs,
                                                   Washington, D.C.
    The Subcommittee met, pursuant to notice, at 3:02 p.m., in 
Room 334, Cannon House Office Building, Hon. Jon Runyan 
[Chairman of the Subcommittee] presiding.
    Present: Representatives Runyan, Bilirakis, Cook, Titus, 
O'Rourke, Ruiz, and Negrete McLeod.

              OPENING STATEMENT OF CHAIRMAN RUNYAN

    Mr. Runyan. Good afternoon, everyone, and welcome. This 
oversight hearing of the Subcommittee on Disability Assistance 
and Memorial Affairs will now come to order.
    Before I begin with today's hearing topic, I would like to 
take a moment to acknowledge the events of today's date 12 
years ago, when a series of coordinated terror attacks was 
launched in New York City and here in Washington, D.C. With New 
Jersey's Third District in close proximity to New York City, 
the impact of the September 11th attacks were felt immediately 
to many of those in my district and across our country. Those 
wounds are still healing, as many of our Nation's 
servicemembers and veterans have served post-9/11 in support of 
the homeland defense in Iraq, Afghanistan, and other overseas 
operations.
    On the anniversary of September 11th, and every day, we 
must all appreciate and remember what American veterans have 
done to secure our freedoms. I know the Ranking Member, Ms. 
Titus, and other Members of the DAMA Subcommittee share my 
commitment to ensuring that every hearing we hold addresses the 
important issues concerning those who have bravely served our 
Nation. And that is why we are here today to focus on the fully 
developed claims process, or FDC, to look at this as an avenue 
to speed up the claims process for our veterans. And FDC is an 
optional program through the Veterans Benefits Administration 
that allows veterans to receive a faster decision on their 
claim by certifying that all relevant records are in their 
possession and have been obtained and submitted rather than 
just filing the claim and having VA perform this development.
    In addition, Congress passed a law last year that went into 
effect August 6, 2013, allowing claimants to receive up to 1 
year of retroactive benefits as an incentive for filing an FDC. 
In order to increase awareness for these incentives, VA has 
partnered with various Veterans Service Organizations, and many 
of whom are here today to testify about their outreach efforts 
and experience with the FDC program.
    However, this Committee will always remain vigilant in its 
oversight of this and all other new VA incentives. It is 
critical to ensure that the program is truly helping veterans 
receive more timely and accurate benefit decisions rather than 
just looking for ways to shift VA's workload.
    With that, I would like to welcome our witnesses and thank 
you all for being here today. Our first panel will consist of 
Mr. Thomas Murphy, Director of Compensation Service with the 
Department of Veterans Affairs. Our second panel will consist 
of several VSOs, including Ms. Verna Jones, Director of 
Veterans Affairs and Rehabilitation Commission for the American 
Legion; Mr. Steven Wolf, Assistant National Service Director 
for the Disabled American Veterans; and Ms. Diane Zumatto, the 
National Legislative Director for AMVETS; and Mr. W. Clyde 
Marsh, the President of the National Association of State 
Directors of Veterans Affairs. We also have several statements 
for the record that have been submitted from various 
organizations, and I would like to thank all of those who 
submitted them for today's hearing.
    With those instructions complete, I am eager to hear from 
all of our witnesses on the implementation of the FDC process. 
And I would now yield to our Ranking Member, Ms. Titus, for her 
opening statement.

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

              OPENING STATEMENT OF HON. DINA TITUS

    Ms. Titus. Well, thank you, Mr. Chairman. And thank you for 
those remarks about the anniversary of September 11th, 
something that we can't say often enough. And thank you for 
holding this hearing. I think it is a very important topic.
    You mentioned the much discussed backlog. And I am happy to 
report and give credit where credit is due that the VA has 
reduced the claims inventory by nearly 150,000 veterans in 
pretty short order. Nearly all the claims that have been 
pending for over 2 years have been processed, and the VA is 
working hard to eliminate all those claims pending over 1 year 
by the end of 2013.
    Also, the VA has rolled out its electronic processing 
system in all 56 VA regional offices. That was done earlier 
this summer, and ahead of schedule, to attempt to get rid of 
all the piles of paper that we have used in the past. We know, 
though, that there is no quick fix, and there is still a lot 
that needs to be done to address the backlog. There are still 
437,000-some claims that have been pending for over 125 days as 
of September 9th, so we have got work to do. There are over 
5,000 that have been pending for that long in the State of 
Nevada alone, and this is just too many. One is too many, but 
this is certainly too many.
    The recent dip in the backlog has been the culmination of 
more than 4 years of effort and planning by the VA, and it is a 
direct result of a number of the initiatives that have been 
introduced within the VA's transformation plan. And today, 
another program in this plan is the one that we will be 
discussing, as you talked about, the fully developed claims, 
FDC initiative, and the 1-year look back for benefits for those 
who file claims in this way that took effect on August the 6th. 
The fully developed claims initiative establishes a method for 
veterans, with the help of their advocates and many of you in 
this room in the service organizations, and the DoD, to gather 
records and provide all the necessary evidence that you need 
for processing a claim. And the average that we have heard is 
today the VA is able to adjudicate those claims in about 123 
days, which should help a lot to lower the backlog in that, 
because that is much more quickly than the old way of doing 
those things.
    So I want to commend the efforts of all our VSOs who have 
been helping with this, American Legion, Disabled American 
Veterans, National Association of State Directors of Veterans 
Affairs. Without your help and your close partnership with the 
VA, I don't think this initiative would have been possible.
    Over the August recess, I held a meeting and a training 
session in District One in Las Vegas with the local VSOs and 
the director of the Reno office and a training officer to have 
a personal connection to try to show how to make this work 
better, how to get the word out, how to communicate with 
veterans what they need, and I think it was a very successful 
session. They said they appreciated the one-on-one connection 
as opposed to just a computer training. And so, I would 
encourage Members of this Committee and all Members of Congress 
to reach out to their local VSOs to have similar events and 
promote this effort.
    I also want to thank my friend from Texas, Mr. O'Rourke, 
who has introduced legislation to help educate veterans about 
this initiative to make it work better. So I hope we will be 
considering that in short order.
    I remain, with the Chairman, committed to working with the 
VA and the VSOs, to always improve the care and services that 
our veterans deserve and to get them to them in a timely 
manner. So I am optimistic about this new initiative and hope 
that it will contribute to that goal.
    So thank you, Mr. Chairman. I will yield back.

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

    Mr. Runyan. I thank the gentlelady. And at this time, I 
would like to welcome our first panel and our first witness, 
Mr. Thomas Murphy, who is the director of compensation service 
with the Veterans Benefits Administration of the Department of 
VA.
    Your complete and written statement will be entered into 
the hearing record. And, Mr. Murphy, you are now recognized for 
5 minutes for your oral testimony.

  STATEMENT OF THOMAS MURPHY, DIRECTOR, COMPENSATION SERVICE 
 VETERANS BENEFITS ADMINISTRATION, U.S. DEPARTMENT OF VETERANS 
                            AFFAIRS

    Mr. Murphy. Mr. Chairman and Members of the Subcommittee, 
thank you for the opportunity to discuss the Department of 
Veterans Affairs' Fully Developed Claim program. Claims are 
considered to be fully developed when a veteran submits a VA 
form 21-526EZ in either paper or electronic format, as well as, 
one, all available supporting evidence such as private 
treatment records; two, notification to VA of any relevant 
Federal treatment records; and three, they certify they have 
nothing further to give to VA regarding the claim. FDCs are 
essential to achieving VA's goal of completing claims within 
125 days at 98 percent accuracy in 2015. This is the fastest 
way to receive a decision on a claim because all evidence 
needed from the veteran is submitted with the claim.
    As of August 30, VA completes FDCs in an average of 123 
days. This is less than half the time it takes to go through 
the traditional process. When a veteran submits evidence with 
his or her claim, it significantly reduces the amount of time 
VA spends on it. While some development may still be necessary, 
such as obtaining Federal records or providing examinations, 
FDCs eliminate the need for VA to search for evidence. The time 
saved in this critical step translates directly to reducing 
processing time, benefiting both the veteran and the VA.
    VA is continuing to implement several people, process, and 
technology initiatives, including FDCs, to meet the 
department's goal. As of August 31, these efforts have reduced 
the backlog to about 460,000 claims, a nearly 25 percent 
reduction off of its peak in March of 2013. VA is required to 
assist the veteran with substantiating a claim for compensation 
or other benefits. This is known as duty-to-assist and a duty-
to-notify. These duties are met through the veteran's use of 
the VA form 21-526EZ and the submission of all supporting 
evidence.
    There are circumstances that affect VA's ability to process 
an FDC in an expedited manner, causing VA to exclude these 
claims from the program. These reasons include a claim or 
appeal which is already pending on behalf of the veteran, the 
wrong form is used, the form isn't signed when submitted, a 
veteran submits additional evidence after filing the fully 
developed claim, VA must obtain evidence from a non-Federal 
source, or a veteran misses or reschedules medical 
examinations. Through better outreach and training, we have 
reduced the exclusion rate from about 25 percent at the 
beginning of this fiscal year to less than 13 percent today.
    VA is aggressively pursuing expansion of the FDC program 
and has conducted a number of outreach initiatives to encourage 
participation. FDC webinars have been held for claimants 
interested in the program, and we have advertised it through 
press releases, social media, and at all VA facilities 
nationwide. VA has also distributed an FDC toolkit to every 
congressional office that contains information for inclusion on 
Web pages and in correspondence with constituents.
    VA continues to rely on our VSO partners in spreading the 
message about fully developed claims. We partnered with the 
American Legion, Disabled American Veterans, and the National 
Association of State Directors of Veterans Affairs in order to 
form the community of practice. VA's community of practice 
partners are helping to identify best practices in the FDC 
program, so they can be shared nationwide. In addition, each VA 
regional office is conducting an FDC workshop for Veterans 
Service Organizations and other partners. It is designed to 
ensure all stakeholders understand the importance of this 
program. Some of your staffers have attended these workshops.
    Community practice partners are committed to increasing the 
numbers of FDCs they file on behalf of veterans that they 
represent. In each case, the organization indicates a 
commitment to supporting FDC submissions. In some cases, it is 
providing appropriate training, and in others, it is a higher 
percentage of submissions. Some State Departments of Veterans 
Affairs, like California and Texas, are even hiring additional 
staff.
    Through these efforts by VA and our VSO partners, we have 
already received over 148,000 fully developed claims so far 
this fiscal year. This represents almost 15 percent of 
receipts. So far this last quarter, almost 25 percent of claims 
submitted are through the FDC process. Public Law 112-154 
provided the authority to grant 1 year of retroactive 
compensation benefits for veterans who file an original claim 
that is fully developed and received between August 6, 2013, 
and August 5, 2015. Interim guidance was issued on August 2. It 
instructed regional offices on the requirements for granting 
retroactive benefits while the regulations are being developed.
    The fully developed program is a key component of VA's 
transformation plan, but VA continues to prioritize other 
specific categories of claims, including claims of seriously 
wounded, ill, and injured, Medal of Honor recipients, former 
prisoners of war, homeless veterans, terminally ill, and those 
experiencing extreme financial hardship. Our partners and 
advocates have fully embraced the FDC program and have made 
commitments accordingly. VA continues to reach out and educate 
all on the fastest way to receive a decision.
    This concludes my statement, Mr. Chairman. I would be happy 
to answer any questions you or other Members of the 
Subcommittee may have.

    [The prepared statement of Thomas Murphy appears in the 
Appendix]

    Mr. Runyan. Thank you, Mr. Murphy. And I will begin with a 
few questions. The first thing that really enters my mind, the 
dual process. Are there two different job descriptions for a 
developer and a rater, or are they done by similar or the same 
people?
    Mr. Murphy. There is an RVSR rater and there is a VSR 
developer, and they are distinct job descriptions.
    Mr. Runyan. Going the next step, noting that the average 
processing time for RFDCs is 123 days, and if this is the 
fastest way to process the claim, is it feasible for VA to 
process all claims, including non-FDCs, in 125 days before the 
2015 deadline?
    Mr. Murphy. Yes, it is. There is a multitude of moving 
parts here that all add up to all claims processed in 2015 in 
less than 125 days. FDC is one arrow in the quiver, I guess 
would be the way to put it. So, yes, it is possible.
    Mr. Runyan. But here is my hangup on that, because when you 
say processing of an FDC is 123 days, that is already saying 
that the VSOs already did the development on that case. You are 
not combining the numbers here. When you look at it, if a 
veteran sends you a claim that is not fully developed, you 
could be up in your 300-day range mark, correct?
    Mr. Murphy. If they send one that is not fully developed?
    Mr. Runyan. Yes.
    Mr. Murphy. Yes, it can be in that 300-day range mark.
    Mr. Runyan. I talk about this all the time where we kind of 
play a shell game, I think, sometimes with the metrics. The 
actual rating of the claim isn't sped up any faster, correct?
    Mr. Murphy. In the fully developed claim the actual rating 
time on the claim, yes--
    Mr. Runyan. The only statistic I see it happens 2 days 
faster than a non-FDC at the rating mark.
    Mr. Murphy. From the ready-for-decision phase to the time 
that it is promulgated stays the same, regardless if it is a 
fully developed claim or not.
    Mr. Runyan. Okay. You note in your written testimony that 
developing a claim takes an average of 128 days. That is what 
we were kind of talking about. If the existing current law 
remains as is, how is the VA planning to improve the 
development process? Are you trying to push everyone to FDCs?
    Mr. Murphy. Okay. The development process is reduced in the 
fully developed claim because when you lay out, there runs, 
depending on the veteran, anywheres from 4 to as many as 10 
parallel paths for development. If I am coming on a fully 
developed claim on a veteran that already has a service-
connection, they are looking for a straight claim for increase, 
I already have that veteran's service records, I already have 
their personnel records, I already have their VA medical 
records, and I simply need any private medical evidence that 
the veteran wishes to submit, and in some cases a VA 
examination, which I can do fairly quickly. And that saving of 
that time, not having to send notices back and forth, and 
meaning specifically VCAA notices or requests for information 
from private physicians, all of that translates into faster 
processing time, and it just reduces that 128-day average down.
    Mr. Runyan. On the development end of it.
    Mr. Murphy. Exactly.
    Mr. Runyan. And then next thing I want to touch on is some 
of your partnerships, and just asking you to provide some 
details with those partnerships. Recently, the VA and the 
American Bar Association announced a partnership that would 
provide pro bono attorneys to assist on pending claims and 
basically develop FDCs on behalf of unrepresented veterans. 
Could you provide any details on how that partnership is moving 
forward?
    Mr. Murphy. We are doing a pilot to see how well this 
process will work in two regional offices with a select number 
of cases in conjunction with the American Bar Association. And 
it is only the piloted with unrepresented veterans, meaning 
they do not have a POA, a VSO at this time. The veteran is 
being contacted through mail and being offered this option. 
They have to select into the process, in which case we will 
refer them to the American Bar Association office, who will put 
them in contact with an attorney that is willing to do some pro 
bono work on behalf of that veteran. Once we see the results of 
how that pilot works, we will determine is there a benefit and 
how we would move it out on the bigger scale.
    Mr. Runyan. And are there any of them in the pipeline?
    Mr. Murphy. We just started the process. We are just a few 
weeks into it at this point.
    Mr. Runyan. Thus far going well?
    Mr. Murphy. Thus far, no.
    Mr. Runyan. Okay. Likewise, the VA just partnered with the 
College of William and Mary Law School Veterans Law Clinic to 
identify best practices in the FDC program. Could you provide 
any details on that partnership?
    Mr. Murphy. The College of William and Mary signed up as 
part of the community of practice in helping with the veterans 
at that school and others to, again, develop claims much like 
the American Bar Association has signed on to do with us.
    Mr. Runyan. Have they brought any of those best practices 
that you have noticed to the table that have helped the 
process?
    Mr. Murphy. I don't have any knowledge of that yet. I am 
not saying that it hasn't happened. I am just saying that I 
haven't been involved with that to that degree where I can give 
you an answer to that one.
    Mr. Runyan. If you find some, would you please forward them 
to me?
    Mr. Murphy. I would be happy to.
    Mr. Runyan. With that, I will yield to the Ranking Member, 
Ms. Titus.
    Ms. Titus. Thank you, Mr. Chairman.
    I would just like to look a little more closely at the 
numbers, because sometimes when you give us national numbers, 
that mask problems that may exist at regional offices. Do you 
have the metrics for Reno, which is the office that serves my 
district in Las Vegas, and the other regional offices? And do 
you see any patterns or have any notion of the buy-in from the 
different offices, what makes one more successful than another, 
what we might do to help those that aren't being as successful?
    Mr. Murphy. Yes. Let's start with Reno. It has been 
approximately, rounding up, approximately 1,600 claims 
submitted through the fully developed claim process in Reno. 
Represents 23, 24 percent of the claims received in the State. 
That puts Reno in one of the top 10 performing offices in terms 
of FDC submissions for this fiscal year so far.
    The other part of your question was, do we have that for 
all offices? Yes, we do. We track it in great detail. We share 
that information with the Veterans Service Organizations, with 
the State directors, with the county veterans service officers. 
And the reason we do that is, the third part of your question 
was, what is effective and how does it work and how do you get 
better numbers? And the answer is direct involvement through 
the national, the State, and the county veterans service 
officers in partnership with the regional office and the staff 
in that regional office.
    Seventy percent of our veterans that come through and 
submit claims are represented by a power of attorney. So having 
those power of attorneys buy into the process the way we are 
doing through the community of practice and other events is 
absolutely critical to the success of this program. And if you 
go back and look at the numbers, first quarter of the fiscal 
year, we brought approximately 5.1, 5.2 percent of the claims 
in through the fully developed claim process. As of this 
quarter, we are at 24-point-something, rounded up to 25 
percent. And that is in small part the VA, but it is primarily 
in part because the Veterans Service Organizations have stepped 
up and said this is the best way to take care of veterans, 
let's drive this program.
    Ms. Titus. That is great. You also mentioned some of the 
things that will keep a claim from being assessed as fully 
developed, the wrong information or adding information. Do 
veterans know ahead of time what is really required of them? 
And if they make a mistake do they have an option to appeal or 
are they just thrown out of the system? Are they aware of that 
going into the process?
    Mr. Murphy. Let me take it from a little bit bigger picture 
and dig down. Okay?
    Ms. Titus. Okay.
    Mr. Murphy. I need veterans coming in through the fully 
developed claim process. It makes me more efficient, it makes 
me put through more claims with the same number of people. So 
right off the bat, I need to get that number down to a single 
digit percentage and as low, close to zero, as I possibly can 
do that. So I need an inclusionary process here.
    We are constantly looking at our Web site, explaining to 
people if you come in through the electronic environment, I can 
steer you where I need you to go because I can steer the 
questions you see and the screens that you do. So I can reduce 
that rate of claims that are rejected. In the paper process, 
which veterans still have the option to do, the veteran can 
complete as much or as little as they choose to do on that 
form. And that is going to dictate whether or not I can put 
that claim into the fully developed claim process.
    So our best tool against that one is the veteran files the 
claim using their power of attorney, and I have well-educated 
Veterans Service Organizations at every level in the 
organization talking to veterans to make sure that they 
complete that paper process in the best environment. At the 
same time, we have given the Veterans Service Organizations 
tools to allow them to come in through the stakeholder entry 
portal and complete that fully developed claim electronically 
on behalf of the veteran.
    Ms. Titus. Well, if they are rejected in the program is 
there an appeal? Can they try it again? Too bad? How does that 
work?
    Mr. Murphy. I don't believe we have an appeal process in 
place on a claim that is removed from the fully developed claim 
process. Now, just because a claim is removed from the fully 
developed claim process doesn't mean that, oh, we are going to 
put you over here and you are on the 280-day track. Okay. I 
inject a claim into the process at the furthest step that I 
possibly can, given the development that is needed. So if you 
didn't sign the form but you have given me all of the evidence 
that you need, I return the form to you, you sign it, it comes 
back, it has all the evidence, and it steps into the process at 
the right step and moves forward from there. So it is not--
    Ms. Titus. You are not back at ground zero.
    Mr. Murphy. Exactly. We take the claim when submitted and 
put it in the furthest step in process we can given the 
information contained in that claim.
    Ms. Titus. Okay. Thank you, Mr. Chairman. I yield back.
    Mr. Runyan. I thank the gentlelady. And before I recognize 
Mr. Cook, I want to get one question in.
    Have you seen an increased number in the FDCs as a result 
of the 1-year early effective date on the provision that was 
effective August 6, 2013? Have you seen an increase in the 
filings?
    Mr. Murphy. We are seeing an increase every week because of 
multiple efforts going on here. To come back and attribute it 
to specifically how much is attributable to that 1 year, I 
don't have that number for you.
    Mr. Runyan. Okay. With that, Mr. Cook.
    Mr. Cook. If I could yield to Mr. O'Rourke.
    Mr. Runyan. Mr. O'Rourke is recognized.
    Mr. O'Rourke. Thank you, Mr. Chairman. And I want to thank 
Mr. Cook for yielding. And I think we have a shared interest in 
the line of questioning I will start with, and hopefully Mr. 
Cook will follow up.
    But the average wait time to hear back on a service-
connected disability claim in El Paso, which is served out of 
the Waco regional office, and actually for all communities in 
Texas served out of Waco, is now 463 days. In our district 
office in El Paso, Texas, we are handling hundreds of 
constituent issues. We are the largest binational community in 
the world. So you can imagine the number of visa and 
immigration issues. A lot of Social Security, Medicaid, 
Medicare. But all of those are trumped by the number of 
disability claim cases for which we become the primary advocate 
for the veteran in El Paso.
    I have had grown men call me in tears because they have 
been waiting for years to hear back on a service-connected 
disability claim. They are injured because of their service to 
this country. They can no longer work, meet their mortgage 
obligations. Their home is being taken by the bank. They can't 
provide for their families. And they can't get a straight 
answer, yes or no, from the government.
    I had a chance to go to Waco to see some of the issues 
firsthand. I saw one veteran's case being wheeled around on a 
hand truck to be boxed, sent somewhere else to be scanned, sent 
somewhere else again to be stored in a warehouse. You have 
outlined some of the reasons why filing a fully developed claim 
and filing one online makes a lot of sense for you all. You 
said, I can do more work, process more claims without hiring 
more people.
    And in a time of sequester, where we are unlikely to see 
greater public resources to meet the demands of the veterans in 
our communities and we are expected to do more with less in 
government, why are you not supportive of the Faster Filing 
Act, which passed unanimously out of this Subcommittee and out 
of the Full Veterans' Affairs Committee, which would help the 
veteran--and by extension help you--to make the best decision 
for their interests in getting a response back in a period of 
under 125 days, or maybe even under 100 days if they file it 
online, would save you money, would allow them a year's worth 
of retroactive benefits, and makes a ton of common sense and 
follows some of the things that you are doing already?
    And for those who don't know, the Faster Filing Act 
requires the VA to alert a veteran to the fastest and slowest 
way to process that claim. The fastest is a fully developed 
claim filed online. The slowest is one that is not fully 
developed that is filed in a paper format.
    We are just asking the VA in this bill to provide that 
information to the veteran. He will make the best decision in 
his or her best interests. It will likely be the best decision 
for your interests in managing your operations and getting that 
wait time and total backlog inventory down. And yet when we 
asked for you to adopt these as administrative procedures, we 
got a letter back yesterday from Secretary Shinseki claiming 
that this would place a significant administrative burden on 
the agency, it would impose difficulties. In essence, it is 
just too much trouble for you all to do this.
    We are trying to get to the same place. We are trying to 
provide the information to the veteran so they can get an 
answer quickly. Why won't you support us in this?
    Mr. Murphy. I believe one of the comments the Secretary put 
in that letter was that we support the bill in concept, but 
there is some administrative burden in there which will detract 
from the processing of claims and divert resources from 
processing claims in order to do that. And I think that in 
concept with what you have in the bill we like what is there, 
but we would love the opportunity to sit down, have some 
conversations about where we see those administrative burdens 
and how we can get what we see as beneficial to VA and the 
veteran, and limit some of those administrative burdens that we 
are talking about here.
    Mr. O'Rourke. I may be able to understand that it might 
require a little bit of work up front. I think your even short 
and certainly medium and long-term gains would recoup that 
initial investment and cost many, many, many times over for 
you. And for the veteran to know up front that I am going to 
get an answer back in less than 123 days if I go this way, but 
I am likely to wait in Waco 463 days, or whatever it is at that 
time, if I go the other way, they will make the best decision. 
It just makes so much obvious sense to me that, frankly, I 
can't understand your answer. I think it is why this has been 
endorsed by the IAVA, it has been endorsed by the American 
Legion, it is strongly supported by other Veterans Service 
Organizations.
    I wish you had given us your feedback and concerns prior to 
this passing out of the Subcommittee, the Full Committee. It is 
going to go to the floor of the House. I hope that it passes. 
It is endorsed on a bipartisan basis. I wish you would work 
with us instead of working against us on this one.
    And, Mr. Chair, I will yield back.
    Mr. Runyan. The gentleman's time from California is 
expired. If the gentleman from Texas would like his 5 minutes 
now, he is recognized.
    Mr. O'Rourke. I will yield to the gentleman from 
California.
    Mr. Runyan. The gentleman from California is recognized.
    Mr. Cook. Thank you very much, Mr. Chair.
    Obviously, I share Mr. O'Rourke's concern. We had sent a 
letter, I cosigned that. And I got to be honest with you, to 
get it back the day before the night of the hearing, where you 
are trying to be prepared and ask the pertinent questions, I 
wasn't too happy. And I know you are busy, we are all busy. But 
the rationale, I think we worked on this because we wanted the 
claimant to have more information.
    And a lot of the people are very, very confused about the 
process. I have gone through this. I am confused. And I am 
sorry, first of all, just the culture of answering. Everybody 
talks in acronyms. And maybe I understand most of them and 
everything like that. And we have got to stop using the 
acronyms. And I will get on my high horse and I will say the 
same thing over and over again, don't use terms that lawyers 
use, and problematic, and just be very, very straight with the 
veterans. That is the environment that they have operated in. I 
think they want to know the straight scoop.
    And, you know, I am just a dumb marine, and I always go by 
the old principle, the KISS principle. Maybe it was invented 
for me specifically. Keep it simple, stupid. And just to get 
that information out there. And I think oftentimes, when it is 
user friendly and they understand some of the problems and the 
delays and everything that is going on there, wouldn't be this 
perception that the VA is the enemy.
    Most of the things that I deal with in my district are 
veterans, and some of them are not happy. And I am sure you do 
a lot of great good. We are always trying to take care of those 
ones that something is wrong. And it is tough. And I think the 
purpose of the bill was right on target about trying to make 
sure that we made it simpler, that they would know exactly what 
is going on. And, you know, I read the second page here, and I 
was a little miffed at it. And it is like, basically, you know, 
we got an admin burden, we are too busy, sorry about that, try 
again next year. And that was just my take on it.
    And I have said repeatedly, you know, some of these I think 
you are making tremendous progress. I think the fact that more 
and more people are filing claims. It is very, very difficult. 
And I understand that. But I always go back to the bottom line. 
I don't understand a lot of things that you do, and I apologize 
for that. But I always learned that I always try and take care 
of my troops. So if it is easier to understand what is going on 
and what they have to do without the acronyms, then I am going 
to support something like that. So if you could address that.
    Mr. Murphy. I got to break the comments on the bill into 
two halves. One of them is about providing information to a 
veteran. We are already programming our Web site, based on your 
letter to the Secretary and other information from others, to 
include that information on the Web site and make it publicly 
available. The objection is not about providing information to 
veterans about the performance of the fully developed claim and 
what is the fastest way to put a claim through the process. It 
is about the administrative burden of providing notices and 
signatures on the part of the veteran. And it turns into what 
came out of the VCAA with the duty-to-notify process. And it 
can have an unintended second-level consequence of slowing the 
claim process down. That is the part of this bill that we want 
to avoid.
    Mr. Cook. VCAA.
    Mr. Murphy. The Veterans Claims Assistance Act, where we 
have to notify a veteran of what it takes to submit a claim and 
what it takes to adjudicate a claim.
    Mr. Cook. Okay. You know, I think Congressman O'Rourke's 
comment about working together, I don't know whether we could 
sit down and explain our concerns. I think we are all trying to 
do the same thing. And maybe if we could get there, where we go 
through this, then maybe we could have a consensus on how to 
accomplish that. I would be willing to do that.
    Mr. Murphy. I agree, Congressman Cook. I think we are just 
trying to work out a few of the details to accomplish the very 
same thing. Information in the hands of a veteran makes the 
veteran do an informed decision, and it will get them more 
involved in my process, which makes me faster. It is not a bad 
thing.
    Mr. Cook. Okay. Thank you.
    Mr. Runyan. I thank the gentleman.
    With that, I recognize the gentlelady from California now 
Ms. Negrete McLeod.
    No questions?
    With that, I recognize the gentleman from Florida, Mr. 
Bilirakis.
    Mr. Bilirakis. Thank you, Mr. Chairman. I appreciate it.
    And I was reading the testimony of the PVA, and they have a 
concern, and I am going to ask the question for the gentleman, 
my concern as well. It says, ``Another key concern relates to 
the potential erosion of due process should a veteran disagree 
with an FDC decision or desire to add evidence later that 
supports a higher rating. By agreeing to submit an FDC, 
claimants essentially waive their rights to contest the 
decision in exchange for a faster decision.'' Do you have any 
comments on that, sir?
    Mr. Murphy. The veteran is not waiving any rights. They are 
opting into a process which can help accelerate it faster. But 
the veteran at any time, if they believe they have other 
evidence which can result in a higher award, can submit that 
evidence, any time in the process can submit that evidence. In 
addition to that, if the decision is already made, they can 
file a new claim or go back in and open an old existing claim.
    So this is not meant to be an exclusionary ``I am going to 
do this and I am only allowed to go this path forever.'' This 
is at the veteran's discretion to have the ability to include 
the evidence they want submitted and participate in this 
process. In return for that, they help us get to a faster 
decision, resulting in a faster decision on their claim.
    Mr. Bilirakis. Are you willing to meet with the PVA with 
regard to this concern?
    Mr. Murphy. Absolutely.
    Mr. Bilirakis. All right. Very good.
    All the other questions, most of the questions were asked, 
Mr. Chairman. Thank you very much for holding this hearing. I 
yield back.
    Mr. Runyan. I thank the gentleman.
    With that, I will recognize the gentleman from California 
Mr. Ruiz.
    Mr. Ruiz. I have no questions.
    Mr. Runyan. No questions?
    Any other Members have any further questions? No?
    Mr. Murphy, on behalf of the Subcommittee, I thank you for 
your testimony today, look forward to continuing to work with 
you on these important matters. And you are excused.
    At this time, I would like to welcome our second panel to 
the witness table. First we will hear from Ms. Verna Jones, 
Director of Veterans Affairs and Rehabilitation Commission for 
the American Legion. And second we will hear from Mr. Steven 
Wolf, the Assistant National Service Director for the Disabled 
American Veterans. Next we will hear from Ms. Diane Zumatto, 
the National Legislative Director for AMVETS. And finally we 
will hear from Mr. W. Clyde Marsh, President of National 
Association of State Directors of Veterans Affairs. Your 
complete and written statements will be entered into the 
hearing record.
    And, Ms. Jones, I will recognize you now for 5 minutes for 
your testimony.

   STATEMENTS OF VERNA JONES, DIRECTOR, VETERANS AFFAIRS AND 
 REHABILITATION COMMISSION, THE AMERICAN LEGION; STEVEN WOLF, 
    ASSISTANT NATIONAL SERVICE DIRECTOR, DISABLED AMERICAN 
  VETERANS; DIANE M. ZUMATTO, NATIONAL LEGISLATIVE DIRECTOR, 
AMVETS; AND W. CLYDE MARSH, PRESIDENT, NATIONAL ASSOCIATION OF 
              STATE DIRECTORS OF VETERANS AFFAIRS

                    STATEMENT OF VERNA JONES

    Ms. Jones. Thank you. Good afternoon, Chairman Runyan, 
Ranking Member Titus, and Members of the Committee. Thank you 
for inviting the American Legion to testify today about the 
Fully Developed Claims program. I am excited about this Fully 
Developed Claims program because we, the American Legion, have 
been deeply involved since the beginning, and we are finding 
that this program can be a great example of what happens when 
all the players--the veterans, the VSOs, Congress, and the VA--
all work together to get things done. When everyone works 
together, it is the veteran who wins.
    There was a lot of initial resistance about the FDC 
program. People had the mindset that, isn't this just making 
the VSOs do the work of the VA? Isn't this putting too much of 
a burden on the veteran? That is not how it works. Our service 
officers are already trained to put together as much of the 
information up front for every claim for VA, for every veteran 
that they work on. They are doing the same work that we have 
always done, but now the VA is moving faster and the veteran 
has a hand in the processing of their claim. When the VA gets 
this claim, they can do a better job because they have 
everything they know the veteran wants to give to them, and 
they know the claim is in good order.
    We have been studying this intensively for almost a year 
now, and we have conducted some week-long visits. We did eight 
visits, and we did visit Reno as well. We went to eight 
regional offices to see how the process was working and see how 
it was working out in the field. We are finding that what works 
is when everyone buys into this process. But it has to be buy-
in on both sides of the street. If the VA leadership in an 
office does not believe in the program, then you are not going 
to see as much success as the offices where VA leadership buys 
into the program.
    And by the same token, we have had to do a lot of work with 
our own service offices. We went out to those regional offices, 
we talked to our American Legion service officers, we looked at 
the FDC claims, and we found training opportunities to make 
sure that we were giving the VA a better quality product to 
work with.
    I have seen what we can accomplish when we do this right. 
Veterans are getting decisions in less than 125 days. We have 
seen out in different offices, where they get them in 90 days, 
60 days, and a few even 30 days from the time they submit it to 
the time that the claim was adjudicated.
    We are working hard to commit our service offices to this 
program because it gets better results for veterans. And we are 
hoping that VA is making the same push to their leadership to 
get more consistent results from all the offices. In offices 
like Indianapolis, it took buy-in from all levels, from the RO 
director down to the employees and to the American Legion 
service officers and the other service organizations. They were 
ultimately so successful that they had to add additional lanes 
for the program. And even at that high volume, they continue to 
turn out better results for the veterans.
    Offices where you didn't really see the buy-in, we were 
disappointed in Baltimore, which could use some help in dealing 
with the backlog. Baltimore was aggressively excluding veterans 
from the FDC program. That is what we found during our FDC 
visits. An example is, in Baltimore they had a veteran, they 
spent more time trying to exclude a Pentagon 9/11 veteran out 
of the FDC program than the time it would have taken to 
adjudicate that claim.
    We have to start with the basic question, is this going to 
help the veteran? With FDC, we believe the answer is yes. There 
are some things that they can do to make it better. For 
example, work with the National Guard and Reserve veterans in 
this program. The last decade has certainly shown the men and 
women of the National Guard and Reserves are just as involved 
in defending this Nation as the active duty troops. We should 
be working to make sure they don't get left out.
    When we see how effective this can be and how great the 
turnaround results are for the veterans who qualify, it can 
take away the pressure and some of the resources needed to work 
on the claims of the veterans who don't qualify for this 
program. We realize this has to be an important part of turning 
around the backlog.
    Thank you again for putting the focus on this program. It 
is important with oversight to see not only what doesn't work, 
but the things that are working so we can highlight the way 
forward. I will be happy to answer any questions that you may 
have for me.

    [The prepared statement of Verna Jones appears in the 
Appendix]

    Mr. Runyan. I thank you, Ms. Jones.
    With that, I will recognize Mr. Wolf for his testimony.

                    STATEMENT OF STEVEN WOLF

    Mr. Wolf. Chairman Runyan, Ranking Member Titus, and 
Members of the Subcommittee, thank you for inviting DAV to 
testify on VBA's Fully Developed Claims program so that we can 
share some of our observations and recommendations. After 
working 10 years in the field, and recently accepting my 
position in Washington, D.C., earlier this month, I never 
thought I would be here testifying even before my boxes have 
been unpacked. However, I am honored to be here, and I hope my 
insight and experiences can benefit your work.
    During my tenure in Chicago VA regional office, I was 
fortunate to have been involved from the beginning with one of 
the first and most successful FDC programs. Working together 
with VA RO Director Duane Honeycutt and his staff, DAV and 
other VSOs have made Chicago a model for other stations on how 
to execute the FDC program. I believe that the most important 
ingredients necessary for the FDC program to be widely 
successful is having a strong commitment and open communication 
between VBA, VSOs, and veterans. Earlier this year, DAV, along 
with the American Legion, joined the VA to establish the FDC 
community of practice. Dedicating ourselves, submitting as many 
FDC claims as possible, I saw firsthand in Chicago how much 
difference it makes when you have complete buy-in from VBA and 
VSOs.
    One important component of the success was the creation of 
a dedicated FDC program coordinator whose primary and perhaps 
only mission is to be responsible for the FDC program. DAV 
believes that every regional office should designate at least 
one individual to serve as its FDC coordinator.
    In the beginning, one of the major obstacles of the FDC 
program was the exclusion process, which is the act of removing 
or disqualifying a claim from the FDC program. In many 
instances, claims are excluded from the FDC program for reasons 
that could have been easily avoided simply by contacting a 
claimant directly or one of the service officers, requesting 
any identified or missing to be submitted. In Chicago, in an 
unprecedented event and approach, Director Honeycutt reached 
out to DAV and offered to contact our NSOs by email, when a 
case is being prepared for exclusion from the FDC program. This 
simple act of communication allows our NSOs the opportunity to 
contact the claimant to easily resolve these issues, thereby 
avoiding the exclusion and allowing the claim to remain in the 
FDC program. DAV also believes that this approach should be 
made national policy.
    Additionally, we believe VBA needs to review and revise the 
policy on excluding FDC claims when additional evidence is 
submitted, even though that evidence needs no additional 
development. For example, in Chicago, I had a veteran who 
submitted an increased claim for a back condition. Later on, he 
submitted additional X-ray evidence. Under current VBA rules, 
the submission of this additional X-ray evidence should have 
prompted removal from the FDC program. However, the VBA 
employee contacted our NSO, indicated that because this 
evidence requires no additional development, there should be no 
reason to remove it from the FDC program. This is another 
common sense practice that should be adopted and made national 
policy.
    DAV believes that making veterans aware of the advantages 
of the FDC process is absolutely essential for the greater 
claimant participation. In addition to regularly promoting the 
FDC program through our Web site, magazine, meetings, and 
conferences, DAV also conducts formal orientation classes. In 
Chicago, DAV-led orientation classes are held weekly and 
offered to potential claimants or anyone interested in learning 
about the FDC process, including VBA employees and other VSOs. 
Locally, we have agreements with the VSOs so their claimants 
they represent can come to our DAV orientation classes to learn 
about the FDC program. Participants are provided detailed 
information about FDC programs, requirements, how to file an 
informal FDC, what to expect after filing the FDC claim, and 
what actions would exclude their claim from the FDC program.
    The feedback from the majority of our claimants is that 
they are excited to be involved from the get-go, especially 
knowing they can play a major role in speeding their decision 
process. Mr. Chairman, DAV believes the FDC program has been 
extremely successful in having a positive impact on reducing 
the backlog of disability claims. We look forward to the 
program's continued success and working with VBA and Congress 
to make that happen. This concludes my statement. So I will be 
happy to answer any questions you or your Members of the 
Subcommittee may have.

    [The prepared statement of Steven Wolf appears in the 
Appendix]

    Mr. Runyan. I thank you, Mr. Wolf.
    And with that, I will recognize Ms. Zumatto for her 
testimony.

                 STATEMENT OF DIANE M. ZUMATTO

    Ms. Zumatto. Good afternoon, Chairman Runyan, Ranking 
Member Titus, and Committee Members. Thank you for the 
opportunity to allow AMVETS to voice both our praise and 
concerns regarding VA's efforts to reduce the claims backlog 
via the Fully Developed Claims program. AMVETS fully supports 
the submission of complete claims packages, as we are aware 
that any other position hurts both our veterans and the VA 
employees working their claims.
    Notwithstanding the fact that VA completed a record-
breaking 1 million claims per year in fiscal years 2010 through 
2012, the number of claims received continues to exceed the 
number processed. In response to this disturbing trend, VA 
began implementing a comprehensive transformation plan meant to 
increase productivity and accuracy of disability claims 
processing. While the FDC program is merely one element of this 
plan, it is hoped that, once fully implemented, that it will 
substantially contribute to the elimination of the claims 
backlog.
    Filing an FDC is undoubtedly the fastest way for veterans 
to receive a decision on their disability claims, as it takes 
the onus of locating documents off of the VA and puts it on the 
veteran. Under the FDC program, veterans are required to 
provide all supporting documents and records with their 
original claims. When veterans are able to meet this criteria, 
it significantly reduces the amount of time VA needs to 
accurately process their claims, as well as the veteran's wait 
time.
    According to the VBA's Monday Morning Workload Report, 
under the FDC program the number of pending claims has dropped 
from the high water mark of 919,461 on 16 July, 2012, to the 
current level of 760,820 pending claims on 24 August, 2013. 
Additionally, the number of claims in the backlog has declined 
from 633,469 on 25 March of this year to 459,998 on August 31 
of 2012.
    One major concern that AMVETS does have with the FDC 
program is the removal of the veteran's dependents information 
from a veteran's claim. Dependents have now been relegated to 
an award adjustment action. AMVETS sees this as an ineffective 
and less efficient way to work, since a claim with dependents 
must now be touched multiple times instead of only once before 
it is finalized and authorized. Since the FDC started in May 
2010, the number of pending dependents issues has increased 
from a monthly average of 40,000 to 205,467, according to the 
24 August MMWR. This seems to suggest that we are merely 
shifting the backlog of claims from veterans to their 
dependents.
    We at AMVETS have a major concern with the new backlog of 
dependent award actions. The 205,000 pending issues are merely 
the ones that VA has identified. How many veterans who are 
entitled to dependents allowance have not been identified? 
Currently, that number is unknown. Any way you look at it, the 
removal of dependents from veterans' claims does not make 
sense. VA's own annual reports since 2005 show that for the 
majority of rating decisions, veterans qualify for dependents 
allowance. This has steadily climbed from 51 percent in 2005 to 
56 percent, as noted in the 2011 annual report, which is the 
most current report available. Additionally, it is of critical 
importance that sufficient funds be allocated to manage the 
backlog and to provide multiple levels of oversight as part of 
the VA's attempt to correct the situation.
    I would like to conclude my remarks by noting for the 
record that AMVETS fully supports both Secretary Shinseki and 
Under Secretary for Benefits Hickey. We need to ensure that the 
VA's leadership has the necessary resources to fix the system. 
This concludes my remarks. I will be happy to take any 
questions. Thank you.

    [The prepared statement of Diane M. Zumatto appears in the 
Appendix]

    Mr. Runyan. Thank you, Ms. Zumatto.
    Mr. Marsh is now recognized for his testimony.

                  STATEMENT OF W. CLYDE MARSH

    Mr. Marsh. Mr. Chairman, distinguished Members of the 
Committee, my name is Clyde Marsh. I am the president of the 
National Association of State Directors of Veterans Affairs and 
the director of the Alabama Department of Veterans Affairs. I 
am honored to present the views of the 50 States, the District 
of Columbia, and five U.S. territories on the implementation of 
the very important Fully Developed Claim program.
    As State governmental agencies, we are charged with the 
duty of assisting veterans in filing claims for disability, 
compensation, pension, and survivor benefits. We strongly 
support the concept, methodology, and strategy undertaken by 
VBA in the current FDC program as one of several means to 
reduce the current veterans claims backlog, while also reducing 
time for a rating decision. To help facilitate success of this 
program, each State will endeavor to provide specific mission 
guidance, goals, and checklists to increase both the quantity 
of submissions as well as the quality of claims. In addition to 
our association's support, to date, 46 of our States and 
territories have submitted letters of commitment to VA in 
support of FDCs.
    The provision that provides for up to 1 year for 
retroactive effective date for awards of disability 
compensation is an incentive for veterans to file FDCs. This 
change serves to negate the need for veterans to submit 
informal claims for the sole purpose of establishing a date of 
claim. We strongly support the Fully Developed Claims goal of 
providing a response to claimants within 90 days. Transparency 
will be particularly important to ensure veterans' confidence 
in this process. As advocates for veterans, we accept the 
responsibility for helping them to understand that they are 
certifying the truthfulness of the information that they are 
authorizing for release of information necessary to ensure a 
rating decision. We recommend an increased role for State 
Directors of Veterans Affairs in the overall effort to manage 
and administer claims processing, regardless of whether a State 
uses State employees, national chartered Veterans Service 
Organizations, and/or county veterans service officers. 
Collectively, we have the capacity and capability to assist 
DVA. We are engaged in the establishment of standards for 
training, testing, and accrediting service officers to include 
continuing education and performance standards.
    Several States have taken the lead by integrating the FDC 
process into their claims operation. An example that has 
yielded positive results is the Texas Veterans Commission 
State-funded initiative that included a 28-member team to 
specifically file fully developed claims. They have submitted 
nearly 8,900 claims to VBA for processing. Similar efforts of 
varying scope are ongoing in States nationwide, with resources, 
organizational structure, and operating procedures varying from 
State to State.
    We ask that attention be given to the following areas. One, 
disability benefits questionnaires need to be simplified and 
shortened, especially for less complex conditions. Doing so 
will enhance physician participation. Two, e-Benefits makes it 
possible for veterans to file claims. However, the current Web 
site needs to encourage veterans to seek representation. Also, 
VBA needs to ensure that all States can easily access the 
Stakeholder Enterprise Portal. Three, outreach and trainings 
are critical to the success of the FDC program, and program 
coordinators should be included at the VA regional offices. 
Four, we are working with the VBA to ensure that future Fast 
Letters include State Departments of Veterans Affairs. And 
five, to fully implement the Veterans Benefits Management 
System. It is valid, and it must succeed in order to improve 
the claims process.
    Mr. Chairman and distinguished Members of the Committee, we 
appreciate your work on behalf of veterans. And be assured that 
State Directors of Veterans Affairs remain dedicated to doing 
our part. We are partners with the Federal VA in the delivery 
of services and care for our Nation's patriots. As procedures 
and policies are developed within the FDC program, we look 
forward to participating in the process. We will continue to 
provide feedback as the program runs its course to achieve 
maximum impact in eliminating the claims backlog. Thank you for 
your inclusion of the National Association of State Directors 
of Veterans Affairs in this hearing. And I stand ready to 
answer questions.

    [The prepared statement of W. Clyde Marsh appears in the 
Appendix]

    Mr. Runyan. Thank you, Mr. Marsh.
    And I will begin the first round of questions. My first 
question is for Ms. Zumatto.
    You touched on these a little bit, but I wanted to go a 
little deeper and maybe clarify. In your testimony, you 
categorize the FDC program as moderately successful. What 
additional steps do the VA and other stakeholders need to take 
in order to make this program fully successful? We can't fix 
every one of them. What is the big one we can tackle?
    Ms. Zumatto. That is a very interesting question. I don't 
know whether the Committee knows or not, I don't actually 
process claims myself. So what I would like to do is take it 
back and speak with our national service officer and get his 
input. He was instrumental in writing the testimony for today's 
hearing. And I would like to defer to his expertise to make 
sure that I am giving you the best answer.
    Mr. Runyan. Please do.
    Mr. Runyan. Then I want to touch on Mr. Wolf's expertise 
and experiences at the Chicago RO. Could you briefly describe 
the policy conversations that took place and ultimately shaped 
the FDC program into its current form? And along that line, 
were there some early challenges with the program in Chicago? 
And how were these addressed and resolved? And would you say 
the program is operating as envisioned when it was created in 
2009?
    Mr. Wolf. Thank you, Mr. Chairman.
    First off, I think the biggest thing was communication 
between the VSOs and the VA. Meeting with the management team, 
our management team, other VSOs, coming up with a plan to 
include everyone, and the program being totally, I guess, 
bought into. This was the most important key in the beginning 
stages.
    After that, the changes started to occur. One of the 
biggest things or obstacles that we were running into was 
veterans just didn't know about the program. Therefore, we 
started adapting the orientation programs. We started word of 
mouth with veterans. We started getting the word out. Once the 
veterans started coming in wanting to do the program, it made 
it easier for us to process some of these claims.
    Mr. Wolf. I would say that the program can improve. It is 
running smoothly. However, there are still a lot of veterans in 
every State that don't know about the program, and even ones 
that do know about the program, they need to be educated on the 
program in order to stay in the program and not be thrown out 
into the traditional process where it may take longer to get 
their claims resolved.
    Mr. Runyan. Would you say it is running about the pace that 
I think most people envisioned it?
    Mr. Wolf. I don't know what most people envisioned, Mr. 
Chairman. In Chicago, based on my experiences, we have 
increased the FDC claims there. And I am satisfied with the 
claims there, but I know that we can do better.
    Mr. Runyan. I mean, it sounds like a lot of the programs we 
have in the VA and in the Federal Government--nobody knows 
about them.
    Can you talk a little bit about submitting more evidence 
and how that process works? Because, as the last panel said, it 
sounded like it was pretty flawless, but it seems like you kind 
of had a little bit different of a view on how new evidence 
gets submitted and the process moves forward from there. Is it 
as seamless as the first witness said?
    Mr. Wolf. What happens, based on my experience, when a 
veteran comes into our office and we educate them on what is 
needed, we initially file an informal claim. This protects the 
veteran's effective date, and it gives the veteran 1 year to 
obtain all the additional evidence needed. We give them a list 
specifically indicating what they need in order to stay in the 
FDC program. If a veteran submits something after the FDC claim 
is filed, at times, that claim could be removed. By VA 
standards, it should be removed. However, this is where we have 
been using email communications with the VA, and it has become 
successful. And we would like to see that continue and not 
remove these claims from the FDC program.
    Mr. Runyan. But it is not codified policy, correct?
    Mr. Wolf. No, sir.
    Mr. Runyan. But in your experience, in the RO you were in, 
it worked with the open communications?
    Mr. Wolf. Yes, Mr. Chairman. It works in Chicago. And we 
would like to see that nationwide, obviously, to protect our 
veterans.
    Mr. Runyan. Thank you very much.
    With that, I will recognize the Ranking Member, Ms. Titus.
    Ms. Titus. Thank you.
    First, Ms. Jones, I would like to thank you and the 
American Legion for visiting Reno. I hope we treated you well 
while you were there.
    Ms. Jones. Yes, ma'am.
    Ms. Titus. I wonder if you could share with us any 
perceptions about the visit. We heard some good numbers earlier 
from Mr. Murphy about some of the improvements there. I wonder 
if you could comment on what you found.
    Ms. Jones. Thank you. We had a great visit in Reno. They 
treated us very nicely.
    When we went to Reno, we actually had an opportunity to 
visit with the fully developed claims coordinator and attend a 
fully developed claims training meeting where the fully develop 
claims coordinator conducted training for the VSOs. And a lot 
of the fully develop claims from Reno had been brokered out. I 
think at the very beginning of the fully developed claims 
process with Reno and maybe the changeover in leadership, that 
they weren't quite sure at the beginning where those claims 
needed to go, and so some of the fully developed claims were 
just piling up. Looking at the amount of time that it took for 
a veteran to submit the information, and then for Reno to act 
on it, had a big lag time at the beginning. And then they 
brokered out most of those fully develop claims and started 
over, so to speak, with the ones that were being submitted to 
Reno.
    They did a much better job with the second set of fully 
developed claims that were coming through that office. We had 
an opportunity to talk to the American Legion service officers 
in Reno and train them as well. And when we went back to look 
at the Reno office through the VA and the American Legion, they 
are doing a much better job than before the visit.
    Ms. Titus. Well, thank you. I appreciate it. I am certainly 
glad to hear that.
    My other question is to Ms. Zumatto. You mentioned that 
there is a real need for the VA to make changes with regards to 
dependents and dependents' claims and the information for 
dependents. Do you have any specific suggestions to how we can 
address some of the challenges that dependents face when they 
file claims? And if you want to answer that or anybody else can 
answer that as well.
    Ms. Zumatto. Well, I would say this, that the way things 
were done previously, where the dependents were included as 
part of the veteran's claim, it seems like that would be a more 
efficient way to continue. Right now, under the FDC, apparently 
it is like two tracks. And so even though it is a veteran and 
his or her dependents, at the end of the process there are, you 
know, different codes that have to be referred to and, you 
know, any correspondence that goes back and forth between the 
VA and the dependents and/or the veteran are being done 
separately. And as the numbers show, now we are getting a 
backlog on the dependent issue.
    So, I mean, it is great that we are reducing the backlog 
with veterans. But if we are just robbing Paul to pay Peter, 
whatever, are we really making any progress? So beyond that, 
again, I can take this back and get more specific information. 
But for right now, that is really all that I could offer.
    Ms. Titus. And I would appreciate that. If you could, thank 
you.
    Would anybody else like to comment on that?
    Mr. Wolf. I would like to comment. So for DAV's standpoint, 
the best way to file a dependency claim--whether it be adding a 
spouse or a child--would be through the Stakeholder Enterprise 
Portal where your claim can be done in 1.2 days versus more 
than 120 days, the paper route.
    Ms. Titus. Thank you.
    Mr. Chairman, maybe we could get some more information from 
the VA about why they changed this policy and what their 
reasoning was about why that would be a better way to do things 
and see if it has turned out to be the case or not.
    Mr. Runyan. Okay. We will take a look at that.
    Ms. Titus. Thank you.
    Mr. Runyan. Mr. O'Rourke.
    Mr. O'Rourke. Thank you, Mr. Chair. And I want to also 
thank you for convening this panel. And I really appreciate the 
nature of your questions about how do we ensure that something 
that is perhaps working well becomes fully successful. And the 
feedback that we have received today is especially helpful to 
that end.
    And I want to commend the VSOs who have been very 
responsive to our office. You know, when we were writing this 
Faster Filing Act legislation, all of your organizations 
responded to us, gave us feedback to improve it, let us know if 
you could support it or why you could not support it. I wish we 
had heard back from the VA before the Subcommittee voted on it, 
before the Full Committee voted on it, you know, sooner 
certainly than a day before we had today's hearing.
    But having said that, I think it is important to 
acknowledge that Mr. Murphy from the VA has remained. He is 
listening to your testimony. And I think that while we have 
that chance to have the administration here, to have those of 
us who might be able to offer legislative remedies to some of 
the problems and to get it fully successful, we should make the 
most out of it.
    So before I ask some specific questions around that, I also 
wanted to, Mr. Marsh, through you, thank one of your member 
organizations, the Texas Veterans Commission. They cohosted 
with our office earlier this month a Beat the Backlog event. 
For the other members, it was highly successful. We had nearly 
100 veterans come in. We were able to give them current status, 
file additional information. We were able to begin 22 new fully 
developed claims and start them online. So a modest beginning, 
but it is something that we want to build on. And certainly TVC 
was instrumental in helping us do that, the Texas Veterans 
Commission.
    So for each of you, if you could each take a minute or less 
in the KISS manner that Mr. Cook was talking about. What is 
one, maybe two things that you want me, us, to focus on to 
improve the FDC process, either administratively or 
legislatively? And begin with Ms. Jones and take it down the 
line.
    Ms. Jones. Thank you.
    Though we certainly do support the fully developed claims 
process, there are a couple of concerns. One, more training. I 
think that some of the things we saw when we were out 
conducting the fully developed claims visit that there was lack 
of consistency. Where you would see one office, how they 
handled submission of new evidence or if a veteran has--say 
they submit five contentions on their claim, a fully developed 
claim, and four of them are, by definition, a fully developed 
claim, it concerns me that they would push that whole claim, 
that whole veteran back out into the traditional process 
because one of those contentions does not meet fully developed 
claim criteria, by definition. So we would like to see work on 
that, to help us be able to have that veteran, get some money 
coming into the homes of those veterans by adjudicating those 
four contentions and deferring the one and still have that be a 
fully developed claim, by definition.
    Mr. O'Rourke. Thank you.
    Mr. Wolf.
    Mr. Wolf. Thank you. Obviously DAV would like to see more 
accountability within the VA regional offices regarding the 
fully developed claims process.
    Mr. O'Rourke. Is that published data on a quarterly, 
monthly basis in terms of how those claims are being processed, 
the rejection rate, that kind of data and accountability?
    Mr. Wolf. More so accountability with management and the 
staff within the VA regional offices. Just to hold 
accountability for the claims to be processed in a timely 
manner and to be taken seriously when VSOs and veterans are 
awaiting the decisions.
    We would also like to think that the utilization of common 
sense methods that I spoke about in my testimony be utilized 
nationwide and not just throw out FDC claims for missing 
signatures and such.
    Mr. O'Rourke. And, Mr. Wolf, I am going to go to Ms. 
Zumatto just to make sure I have enough time in what remains.
    Ms. Zumatto, you mentioned the dependents issue. Would that 
be your primary recommendation for us to look at?
    Ms. Zumatto. That would be probably the top thing. That, 
and I agree with what my colleagues have said, we need to have 
improved training for the VSOs and for the veterans themselves. 
And we need to have continuing education for the VA employees.
    Mr. O'Rourke. And, Mr. Marsh, if you were to focus us on 
one issue that you think could improve this FDC process.
    Mr. Marsh. I would say that we need to let the FDC process 
run its course to work and support the ongoing efforts of 
training in all States, at all regional offices, and funding 
and support by Congress is key and essential to making that 
happen. And key pieces of that are ensuring that the 
Stakeholder Enterprise Portal works because that is the conduit 
for States to get in and for veterans to submit those claims 
and FDC seamlessly and faster. And the veterans' benefits, 
VBMS, these are all different pieces that make this process 
work to eliminate that backlog. And funding and letting these 
particular programs work, of course, we need to make it better 
and do more, which we are doing, I think that is the key to 
success.
    Mr. O'Rourke. Thank you. Thank you all.
    Mr. Chairman, I yield back.
    Mr. Runyan. I thank the gentleman.
    Ms. Negrete McLeod, do you have any questions?
    I have one more question for Mr. Marsh.
    You noted in your written testimony that many areas of the 
country are still underserved due to veterans' lack of 
information and awareness to their benefits. Could you describe 
how your organization is addressing this issue and particularly 
how you are raising awareness for the FDC program?
    Mr. Marsh. What we are doing, as a State, is we are holding 
a supermarket of benefits. These are kind of like rallies 
throughout the State in different areas where we invite 
veterans in and other State organizations to support our 
veterans in many different benefits. We also are sending out 
newsletters and we are holding training sessions specifically 
focusing on FDCs now, but also to disseminate information about 
veterans' benefits, period, throughout the State to help get 
the word out and get people involved. And also highlighting the 
importance of, by using this process, we can eliminate and 
reduce the time for rating decisions.
    Mr. Runyan. Thank you.
    Anyone else have anything else?
    Ladies and gentlemen, on behalf of the Subcommittee, I 
thank you for your testimony today. We look forward to 
continuing to work with you on the implementation of the FDC 
program, and we understand that your partnership with the VA is 
crucial to the program's success. And you are now excused, and 
I would like to thank everyone for being with us today. The FDC 
program has great potential to reduce processing times for our 
veterans' disability claims. And I look forward to continuing 
to work with all of you to ensure that we implement the most 
efficient claims processing initiatives possible.
    I would like, once again, to thank all of our witnesses for 
being here today. I ask unanimous consent that all Members have 
5 legislative days to revise and extend their remarks and 
include any extraneous material. Hearing no objection, so 
ordered.
    I thank the Members for their attendance today. And the 
hearing is now adjourned.

    [Whereupon, at 4:20 p.m., the Subcommittee was adjourned.]



                            A P P E N D I X

                              ----------                              

            Prepared Statement of Hon. Jon Runyan, Chairman

    Good afternoon and welcome everyone. This oversight hearing of the 
Subcommittee on Disability Assistance and Memorial Affairs will now 
come to order.
    Before I begin with today's hearing topic, I would like to take a 
moment to acknowledge the events of today's date twelve years ago when 
a series of coordinated terror attacks were launched in New York City 
and here in Washington, DC.
    With New Jersey's Third district in close proximity to New York 
City, the impact of the September 11th attacks were felt immediately to 
many of those in my District, as they were across our country. These 
wounds are still healing, as many of our Nation's servicemembers and 
veterans have served post 9/11 in support of homeland defense, in Iraq, 
in Afghanistan, and other overseas operations.
    On the anniversary of September 11th and every day, we must all 
appreciate and remember what America's veterans have done to secure our 
freedoms.
    I know Ranking Member Titus and the other Members of the DAMA 
Subcommittee share my commitment to ensuring that every hearing we hold 
addresses important issues concerning those who have bravely served our 
Nation.
    That is why we are here today to focus on the Fully Developed 
Claims process, or FDC to look at this as an avenue to speed up the 
claims process for our veterans.
    An FDC is an optional program through the Veterans Benefits 
Administration that allows veterans to receive a faster decision on 
their claim by certifying that all relevant records in their possession 
have been obtained and submitted, rather than just filing the claim and 
having VA perform this development.
    In addition, Congress passed a law last year that went into effect 
on August 6, 2013, allowing claimants to receive up to one year of 
retroactive benefits as an incentive for filing a FDC.
    In order to increase awareness of these incentives the VA has 
partnered with various Veterans Service Organizations - many of whom 
are here to testify today - about their outreach efforts and experience 
with the FDC program.
    However, this Committee will always remain vigilant in its 
oversight of this and all other new VA initiatives. It is critical to 
ensure that the program is truly helping veterans receive timely and 
accurate benefits decisions, rather than just looking for ways to shift 
the VA's workload.
    With that, I would like to welcome our witnesses. Thank you all for 
being here today.
    Our first panel consists of Mr. Thomas Murphy, Director of 
Compensation Service, with the Department of Veterans Affairs.
    Our second panel consists of several VSOs, including Ms. Verna 
Jones, Director, Veterans Affairs and Rehabilitation Commission, for 
the American Legion;
    Mr. Steven Wolf, Assistant National Service Director for the 
Disabled American Veterans;
    Ms. Diane M. Zumatto, the National Legislative Director for AMVETS;
    And Mr. W. Clyde Marsh, the President of the National Association 
of State Directors of Veterans Affairs.
    We also have several statements for the record that have been 
submitted from various organizations, and I would like to thank all of 
those who submitted them for today's hearing.
    With those introductions complete, I am eager to hear from all of 
our witnesses on the implementation of the FDC process.
    I now yield to our Ranking Member for her opening statement.

                                 
                 Prepared Statement of Hon. Dina Titus

    Thank you, Mr. Chairman, and thank you for holding this hearing on 
this very important topic.
    With regard to the VA backlog, the VA has reduced the claims 
inventory by nearly 150,000 veterans in very short order. Nearly all 
claims that have been pending over two years have been processed and 
the VA is working hard to eliminate all claims pending over one year by 
the end of 2013. Also, the VA has rolled out in its electronic 
processing system at all 56 VA regional offices earlier this summer, 
ahead of schedule, in an attempt to end the era of paper processing.
    However, there is no quick fix. There are still 437,372 claims 
pending over 125 days (as of September 9), with more than 5,378 pending 
over 125 days in Nevada. This is too many.
    The recent dip in the backlog has been a culmination of more than 
four years of effort and planning by the VA and is the direct result of 
a number of initiatives within the VA's Transformation Plan. Today we 
will focus on one such program, the Fully Developed Claims (FDC) 
initiative, and the one year look-back for benefits which recently took 
effect on August 6, 2013.
    I am proud to work on behalf of the more than 100,000 veterans in 
Southern Nevada, many of whom have waited months and even years to get 
a response regarding their benefits claims. The Fully Developed Claims 
initiative provides a method for veterans, with the help of their 
advocates and DoD, to provide all the necessary evidence to process a 
claim. Today, the VA adjudicates FDCs in about 123 days. I am hopeful 
that this initiative will help to lower the backlog significantly.
    I would like to commend the great efforts of our VSOs, the American 
Legion and the Disabled American Veterans, as well as the National 
Association of State Directors of Veterans Affairs, who have worked in 
close partnership with the VA and without which the FDC initiative 
simply could not have been possible.
    Over the August recess, I held a meeting with local VSO chapters to 
promote the FDC initiative and I was encouraged that VSOs across the 
U.S. will work with veterans to submit FDC's. I encourage all Members 
on our Committee to reach out to their local VSO leadership to promote 
this effort.
    I would like to thank my friend from Texas, Mr. O'Rourke, for 
introducing legislation to help educate veterans about this initiative. 
I hope the full House will consider this legislation quickly.
    As Ranking Member of the Veterans' Affairs Committee, I remain 
committed to working with the VA and VSOs to improve the care and 
service for veterans across the country and to ensure these benefits 
are awarded in a timely manner.
    Thank you, Mr. Chairman, and I yield back.

                                 
                  Prepared Statement of Thomas Murphy

    Mr. Chairman and Members of the Subcommittee, thank you for the 
opportunity to discuss the Department of Veterans Affairs (VA) Fully 
Developed Claims (FDC) program. I will first review the definition of 
an FDC and then describe the advantages of this program. Finally, I 
will summarize the VA's efforts to both inform Veterans and engage 
others to partner with us in this FDC program.
FDCs Defined
    Claims are considered to be ``fully developed'' when Veterans 
submit a VA Form 21-526EZ (paper or electronic) and all available 
supporting evidence (such as private treatment records and evidence 
required in special circumstances, such as unit treatment and personnel 
records for Guard and Reserve members, notify VA of any federal 
treatment records at the time they first file a formal claim, and 
certify they have nothing further to give VA regarding the claim.
FDCs are the Fastest Way for Veterans to Receive a Claims Decision
    The widespread submission of FDCs is essential to achieving VA's 
goal of providing all Veterans with decisions on their claims within 
125 days at 98 percent accuracy in 2015. FDCs are the fastest way for 
Veterans to receive a decision on their claim because all supporting 
evidence needed from the Veteran is submitted with the claim. As of 
August 31, 2013, VA completes FDCs in an average of 123 days. When 
Veterans submit such evidence with their claims, it significantly 
reduces the amount of time VA must spend gathering evidence from them 
or other sources. Often, this is evidence that VA must, by law, attempt 
to collect on the Veteran's behalf, even if it is already in the 
Veteran's possession, or is evidence the Veteran could more readily 
obtain, such as private treatment records. While some claim development 
may still be necessary, such as securing federal records or providing 
an examination, FDCs eliminate the need for VA to undertake an often 
lengthy search for evidence as mandated by the Veterans Claims 
Assistance Act of 2000. FDCs allow VA to go straight to gathering any 
required federal records and ordering any necessary medical 
examinations needed to decide the claim. This is advantageous for 
Veterans and VA. Eligible Veterans receive their benefits faster, and 
VA prevents claims from entering its backlog of work. FDCs are 
typically completed twice as fast as traditional compensation claims.
    VA is continuing to implement several initiatives, including FDCs, 
to meet the Department's goal to eliminate the claims backlog in 2015. 
In April, VA launched an initiative to expedite disability compensation 
claims decisions for Veterans who have a waited a year or longer to 
receive a rating decision. In May, VA announced that it was mandating 
overtime for claims processors in its 56 regional benefits offices to 
increase production of compensation claims decisions through the end of 
fiscal year (FY) 2013. By June 19, VA had completed over 97 percent of 
all claims over 2 years old, and turned its focus to those over one 
year old. As a result of these recent efforts coupled with many other 
people, process, and technology initiatives, as of August 31, the 
backlog of claims pending more than 125 days reached its lowest point 
since March 2011. The backlog has been reduced to approximately 460,000 
claims, representing a 25 percent reduction from its peak in March 
2013. In mid-August, VA had already completed one million claims, 
setting a record by reaching this goal a month earlier than planned.
Duty to Notify and Duty to Assist
    VA is required to assist a claimant in substantiating a claim for 
compensation or other benefits. This assistance comprises the first 
phase of the claim process, also known as the development phase, and it 
is by far the lengthiest segment of the process currently taking an 
average of 128 days. The requirements to notify and assist are 
primarily expressed in the following:
    Duty to Notify: 38 U.S.C. Sec.  5103 requires VA to provide the 
claimant and the claimant's representative, if any, notice of 
information needed to substantiate the claim, including medical or lay 
evidence not previously provided to VA. This requirement is met through 
the Veteran's use of the VA Form 21-526EZ (paper or electronic) in the 
FDC submission.
    Duty to Assist: 38 U.S.C. Sec.  5103A requires VA to make 
reasonable efforts to assist a claimant in obtaining evidence necessary 
to substantiate a claim. In particular, VA must assist the claimant by 
obtaining:

      Service treatment records and other relevant records 
pertaining to the claimant's active military, naval, or air service;
      Relevant, claimant-identified medical treatment or 
examination records at a VA facility or at a facility where care is at 
the expense of VA;
      Relevant, claimant-identified records held by any Federal 
department or agency by making requests for the records until such time 
that the records are secured, it is reasonably certain that such 
records do not exist, or that further efforts to obtain the records 
would be futile; and
      Relevant, claimant-identified private records by making 
no less than two requests for the records, unless the records are 
received after the first request or it is evident that a second request 
would be futile.

    38 U.S.C. Sec.  5103A also requires VA to provide a medical 
examination or obtain a medical opinion when such an examination or 
opinion is necessary to decide the claim.
Submitting FDCs Is Convenient
    VA encourages Veterans to submit FDCs through the joint VA-
Department of Defense (DoD) self-service Web portal, eBenefits, which 
provides online information and access to a wide variety of military 
and Veteran benefits resources. Some of the features within eBenefits 
allow Veterans and Servicemembers to access official military personnel 
documents, electronically submit claims for compensation benefits, view 
the status of their disability compensation claims, transfer 
entitlement of Post-9/11 GI Bill to eligible dependents (Servicemembers 
only), and register for and update direct deposit information for 
certain benefits. This Web portal is located at: https://
www.ebenefits.va.gov/.

Partnership with Veterans Service Organizations
    Veterans Service Organizations (VSOs), including State and County 
Departments of Veterans Affairs, are essential partners in the FDC 
program. These organizations have long played an integral role in 
submitting Veterans claims - often with representatives working within 
VA regional offices. VA has consulted with them throughout the 
development and implementation of VA's plan to end the backlog in 2015 
to ensure best practices and their unique insights were incorporated, 
and they have stepped forward in full support of the FDC Program and 
our shared goal of better serving Veterans, their families, and 
Survivors. VA's goal in 2013 has been to increase FDC receipts to 20 
percent of all claims received. With the support of our VSO partners, 
VA has already received over 130,000 FDCs this fiscal year, which 
represents almost 14 percent of all claims received. The 20-percent 
goal has been exceeded in this final quarter of fiscal year 2013, with 
4th quarter FDC receipts increasing to almost 25 percent of all claims 
received.
    As of August 31, 2013, VA completes FDCs in an average of 123 
days--less than half the time it takes to make a decision on a 
traditional claim. FDCs have been instrumental in helping to reduce the 
backlog, as VA saves a significant amount of time when evidence is 
provided at the start of the claims process.

FDC Exclusions
    There are some circumstances that affect VA's ability to process an 
FDC in an expedited manner, causing VA to exclude some claims from the 
FDC program. We are working hard to minimize these exclusions through 
better outreach and training. The main reasons for exclusion have been 
administrative, such as when a claim or appeal is already pending, the 
wrong form is used, or the form is unsigned. Claims must be excluded 
from the FDC program for non-administrative purposes as well. This 
typically occurs when a Veteran submits additional evidence after 
filing the FDC, when a Veteran explicitly declines FDC processing, or 
when VA must obtain evidence from non-federal sources. When VA must 
obtain evidence outside of its control, such as non-federal records, VA 
is unable to control the timeframe in which the records are received. 
Missed or rescheduled medical examinations also slow the process. VA 
has to exclude these types of claims from the FDC program because 
expedited processing cannot be provided.

Outreach
    VA is aggressively pursuing expansion of the FDC program, and has 
conducted a number of outreach initiatives to encourage participation. 
FDC webinars have been held for claimants interested in the program and 
we have advertised the program through press releases, social media, 
and at VA facilities nationwide. VA has also distributed an FDC toolkit 
to every Congressional office to help VA increase FDC participation by 
adding information on this important program to Congressional webpages 
and in correspondence to constituents who are Veterans.
    VA also continues to rely on our VSO partners in spreading the 
message about FDCs. As previously noted, VSO feedback was instrumental 
in creating the FDC program, and VA is continuing this partnership 
through the FDC Community of Practice. VA has partnered with The 
American Legion, Disabled American Veterans, and the National 
Association of State Directors of Veterans Affairs (NASDVA) to further 
improve the FDC program. VA also just recently welcomed The College of 
William and Mary Law School's Lewis B. Puller Jr. Veterans Law Clinic 
to the Community of Practice.
    VA's Community of Practice partners are helping to identify best 
practices in the FDC program so they can be shared nationwide. VA 
recently held a workshop with these VSOs to provide updates on efforts 
to eliminate the claims backlog and to receive feedback from VSOs 
concerning the FDC program. In addition, each VA regional office is 
conducting local training and outreach workshops for VSOs and other 
partners, such as Congressional caseworkers and field staff, to ensure 
all stakeholders understand the importance of this program and how to 
help Veterans utilize it. Community of Practice partners are committed 
to increasing the number of FDCs they file on behalf of Veterans that 
they represent. VA expects additional VSOs and Veterans' 
representatives will join the Community of Practice, helping to further 
improve the FDC process and increase the number of these claims. By 
leveraging each other's experience, knowledge and opportunities, we are 
building a dynamic community of advocates committed to providing 
Veterans with their earned benefits in support of VA's goal of 
eliminating the backlog.

One-Year Retroactive Benefits
    Public Law 112-154, the Honoring America's Veterans and Caring for 
Camp Lejeune Families Act of 2012, provided authority to grant one year 
of retroactive compensation benefits for Veterans who file an original 
claim that is fully developed and received between August 6, 2013, and 
August 5, 2015. Interim guidance was issued to regional offices on 
August 2, 2013. This guidance instructed regional offices on the 
requirements for granting retroactive benefits, and it allows these 
benefits to be granted while the regulations are being developed.
    To be eligible to receive these retroactive benefits, several 
requirements must be met. In addition to the criteria mentioned in the 
preceding paragraph, the claim must be complete. Veterans submitting 
informal or incomplete claims are not eligible for the retroactive 
benefits based on the informal or incomplete submission, though once 
the claim is completed it may be a basis for retroactive benefits if 
other criteria are met. Further, the claim must be received on a VA 
Form 21-526 EZ or online through eBenefits.
    The effective date assigned for benefits awarded under these 
procedures may be up to one year prior to submission of the complete 
FDC, depending on evidence of when the disability was first diagnosed. 
If evidence submitted with the FDC shows that the level of disability 
to be assigned existed for one year prior to submission of the claim, 
then the Veteran will receive a one-year retroactive effective date. If 
the evidence of record supports less than one year of disability, as 
the disability was not present for one year prior to the date on which 
the claim was filed, then the effective date for benefits will be the 
date on which the disability was first diagnosed. In addition, staged 
disability evaluations can be assigned if the evidence shows that the 
disability worsened during the one year prior to the date on which the 
claim was filed.
    Regional offices continue to update local VSOs and other 
stakeholders about FDC program and encourage their support and 
participation. Regional offices are also providing training to local 
VSOs and encouraging them to help Veterans file applications online 
through the eBenefits Web portal and to utilize Disability Benefits 
Questionnaires (DBQ) if private medical records are being submitted. 
Utilizing these three tools - the FDC program, eBenefits, and DBQs - is 
the best way for Veterans to expedite the claims process and receive a 
decision more quickly.

Conclusion
    The FDC program is a key component of VA's Transformation plan to 
eliminate the claims backlog. VA has seen FDC submissions steadily 
increase, and these claims are processed expeditiously. In addition, VA 
continues to prioritize other specific categories of claims, including: 
claims of seriously wounded, ill, and injured Servicemembers separating 
through the Integrated Disability Evaluation System; Medal of Honor 
recipients; former Prisoners of War; the homeless; terminally ill; and 
those experiencing extreme financial hardship. VA has expanded its 
collaborative partnerships through the FDC Community of Practice and 
will continue to work with VSOs and stakeholders to refine this 
program. Our partners and advocates have fully embraced the FDC program 
and have made commitments to submit FDCs in order to get Veterans 
faster decisions. We are joined together by our common belief that no 
Veteran or Survivor should wait extensive periods of time for the 
benefits they've earned. VA continues to reach out to stakeholders, 
Veterans, their families, and Survivors to educate them on the fastest 
way to receive a decision. This concludes my statement, Mr. Chairman. I 
would be happy to answer any questions you or the other Members of the 
Subcommittee may have.

                                 
                   Prepared Statement of Verna Jones

    The Fully Developed Claims (FDC) program is an excellent example of 
what can happen when all of the stakeholders in veterans' benefits work 
together and put delivering service to veterans first. The service 
officers who work for the Veterans' Service Organizations (VSOs) 
present the material to the Department of Veterans Affairs (VA) in an 
organized fashion, in turn have less time needed to develop the claim, 
and can cut the processing time to well below backlog numbers. Congress 
has responded with legislation that offers additional incentive of back 
pay to reflect the extra time veterans must spend gathering material to 
send to VA before they can submit their claim. When everything works 
together, it's the veterans who win. On FDC claims some offices 
reported processing times of 30-60 days, and the average processing 
time nationwide dropped to well under VA's goal of 125 days.
    Not every claim will be eligible to be processed under the FDC 
rules. The FDC program isn't a silver bullet that will alleviate all of 
VA's problems with the backlog. However, with willing participants and 
adequate screening to get the right cases to VA, the FDC program can 
help manage resources and take pressure off other areas so VA can focus 
and finally drive down the backlog of claims.
    The VA announced the implementation of the Fully Developed Claims 
FDC initiative in a meeting conducted at VA Central Office (VACO) in 
July 2012. Through the implementation of the FDC process, VA explained 
their intention to reduce the backlog of disability claims that has 
plagued VA and the veteran community.
    VA announced that it would create a ``segmented lane'' dedicated to 
adjudicate claims in a timely manner; the ``Express Lane'' was created 
to adjudicate a claim qualified as FDC and any claims with up to two 
conditions. For a service member, veteran, or dependent to submit a 
claim qualified for the FDC program, all non-federal records that may 
assist in adjudicating the claim are required to be submitted at the 
time of application. Non-federal records include, but are not limited 
to:

        u  Reserve and National Guard service treatment records
        u  Private treatment records
        u  Lay statements from friends, family members, co-workers, 
etc., supporting the veteran's claim

    In November 2012, The American Legion agreed to partner with the 
White House, Joining Forces, and VA to review the implementation of the 
FDC process nationwide. Recognizing the FDC initiative was potentially 
a seismic shift in the manner veterans' claims could be adjudicated and 
having over 2,600 accredited representatives nationwide, The American 
Legion enthusiastically agreed to join the initiative.
    The American Legion targeted VA Regional Offices (VAROs) nationwide 
to review the FDC implementation process. Data collected from reports 
produced by VA regarding FDC submissions by The American Legion allowed 
for a thorough review of VAROs with high and low FDC submissions.
    The American Legion selected the following VAROs for visitations:

        u  Pittsburgh, Pennsylvania (December 2012)
        u  Denver, Colorado (January 2013)
        u  Indianapolis, Indiana (January 2013)
        u  Baltimore, Maryland (March 2013)
        u  Nashville, Tennessee (April 2013)
        u  Oakland, California (May 2013)
        u  Togus, Maine (May 2013)
        u  Reno, Nevada (June 2013)

    The findings from these visits naturally varied from office to 
office, although several trends were clear. In areas with strong ``buy-
in'' from the VARO Directors and employees, such as in Indianapolis the 
results were explosive. The employees embraced the FDC program as they 
recognized it was a way to award claims expeditiously and avoid the 
lengthier traditional claims process. It was so well received that the 
FDC lane had to be split into sub-lanes to accommodate the volume of 
claims, and the program was still returning better results than the 
traditional legacy system of claims.
    Leadership in the Indianapolis office cited the close relationship 
with The American Legion and VSOs as instrumental to the success of the 
program in that office. Because the service officers could work the 
program effectively with veterans, it helped the VA on the front end 
and gave the program what it needed to succeed.
    One of the criticisms of FDC initially from some veterans' 
advocates was the concern that FDC was putting too much of VA's work on 
the veterans. For The American Legion, the information a veteran is 
required to submit is consistent with our baseline training for service 
officers about how to put together a proper claim. Service officers did 
not feel additional work was required, because the FDC program 
represented what they were already doing for veterans when they 
organized their claims for submission. By taking the work they were 
already doing, and submitting it through the FDC program, they opened 
up the possibility of faster turnaround for the veterans. It was like 
gaining an additional benefit for all the hard work they normally put 
in on behalf of the veteran.
    Not every office has seen the vast improvements seen in 
Indianapolis. Often, The American Legion found where there was not 
committed ``buy-in'' to FDC among management in a VARO, the employees 
would not buy in, and the program would struggle to succeed. Baltimore, 
MD represents an example of this sort of model. As even the national 
press has highlighted, the Baltimore VARO is not one of the higher 
performing Regional Offices within VA. Systemic problems within the 
office, including poor file management and high employee turnover 
contribute to morale issues and poor performance. In Baltimore, it 
often seemed employees spent more time trying to disqualify claims from 
FDC than to process them, and therefore the program struggled to 
succeed.
    To illustrate, The American Legion submitted one claim requesting 
FDC consideration for a veteran who served at the Pentagon on September 
11, 2001. On the day of the terrorist attack, the veteran assisted 
removing individuals from the building and was seeking service 
connected disability benefits for posttraumatic stress disorder (PTSD). 
Supplied medical records supported a PTSD diagnosis; however, Baltimore 
VARO opted to remove the veteran from the FDC process. The FDC 
coordinator indicated that the veteran did not provide information 
indicating he was serving at the Pentagon on September 11, 2001. The 
veteran received a citation for his service that day; moreover, 
billeting and personnel records would also indicate service at the 
Pentagon on September 11, 2001. These are federal records and could be 
retrieved by VA; had Baltimore VARO followed VACO's policy regarding 
the retrieval of federal records, the veteran could have remained in 
the FDC program and received his benefits in an expeditious manner. 
Even when federal records were obtained and the veteran was shown 
assigned to a unit at the Pentagon on September 11, 2001, the VA 
continued to try to kick the case out claiming, ``there's no way to 
prove they were actually at work that day.''
    With an obstructionist attitude towards veterans' claims like that, 
no program in the world is going to help right the ship. Clearly for 
success with any attempt to whittle down the backlog, buy-in to new 
methods and tactics is needed.
    There is buy-in from high levels within VA. In an interview 
conducted with The American Legion for the National Convention in 
Houston, TX in August of 2013, Under Secretary for Benefits Alison 
Hickey stated, ``In 2012 VBA was able to process 60,000 claims under 
the FDC program. Thanks to The American Legion, in 2013 we've already 
been able to up that figure to 120,000 claims.'' VACO is committed to 
making this program work, and The American Legion believes there are 
great benefits towards making it work, and would only suggest a few 
small corrections to help the program maintain its footing.
    The American Legion recommends:

        u  Increased effort and outreach from VACO to ensure consistent 
buy-in and implementation from VARO to VARO. Without consistent buy-in, 
the results will be too fractured to have a national impact on claims.
        u  Include National Guard and Reserve records under the 
category of federal records VA must help locate. Certainly the last 
decade has highlighted the vital contribution of Guard and Reserve 
component service members; they cannot continue to be locked out of 
effective VA programs such as FDC simply because they serve as citizens 
as well as soldiers.
        u  VA must still work to improve accuracy on the claims, even 
as they increase speed of processing with the FDC program. Comments and 
errors regarding claims were far too common during VARO visits. Within 
VA's Monday Morning Workload Report released on September 3, 2013, VA's 
accuracy rate for the previous three months is 90.3 percent. This is 
inconsistent with our Regional Office Action Review (ROAR) visits 
nationwide, where errors are found routinely in over half of the cases 
reviewed. Cases reviewed by The American Legion staff are not chosen by 
The American Legion but by VA employees. Additionally, The American 
Legion successfully argues that VA has either erred or failed to 
properly develop claims in over 70 percent of claims appealed to the 
Board of Veterans' Appeals (BVA).

    American author Napoleon Hill said, ``A goal is a dream with a 
deadline.'' The VA Secretary has established a goal for VA disability 
claims to be adjudicated within 125 days and with 98 percent accuracy 
by the end of 2015. VA views it as a goal; many veterans view it as a 
dream. Regardless, the deadline for the goal is rapidly approaching. 
FDC provides part of the avenue for the Secretary's goal to be 
accomplished.
    Ultimately, we believe FDC is a viable program that can assist VA 
in reducing the backlog and allow veterans to receive their entitled 
benefits. As the program expands and the veteran community recognizes 
its benefits, it will be incumbent upon us to continue to monitor the 
program as it expands. Additionally, focus should continue to exist on 
FDC internally with The American Legion Department Service Officers 
through the Department Service Officer School and other outreach 
training methods. Through this practice, service officers can continue 
to provide the best possible service to the veteran community in their 
quest for veterans' benefits.
    As this program continues to develop, The American Legion looks 
forward to working with the Committee, as well as VA, to strengthen 
this program and any other program that can help tame the backlog and 
get veterans the benefits they deserve in a timely manner. For 
additional information regarding this testimony, please contact Mr. Ian 
de Planque at The American Legion's Legislative Division, (202) 861-
2700 or [email protected].

                                 
                  Prepared Statement of Steven T. Wolf

    Chairman Runyan, Ranking Member Titus and Members of the 
Subcommittee:
    On behalf of the DAV (Disabled American Veterans) and our 1.2 
million members, all of whom are wartime wounded and injured veterans, 
thank you for asking DAV to share with the Subcommittee our views 
regarding the Fully Developed Claims (FDC) program within the Veterans 
Benefits Administration (VBA). 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 and the various reasons claimants 
may appeal adverse actions and decisions.
    To fulfill our mandate of service to America's wounded, injured, 
and ill veterans and the families who care for them, DAV employs a 
corps of 270 National Service Officers (NSOs) all of whom are wartime 
service-connected disabled veterans who successfully complete their 
rigorous DAV training in concert with VA's Vocational Rehabilitation 
and Employment Service. DAV NSOs are located in all VA regional offices 
(VAROs) as well as in other VA facilities throughout the nation. As 
disabled veterans ourselves, and through our personal experiences from 
military life, the compensation claims process, and the VA and military 
health care systems, we have both expertise and a passion for helping 
other veterans through the labyrinth of the VA system.
    Mr. Chairman, I am a veteran of the United States Marine Corps, 
serving on active duty from 1993 to 1997, until I was discharged after 
sustaining permanent service-related injuries. My career as a DAV NSO 
began in Milwaukee, Wisconsin, in 2002, and after serving as Assistant 
Supervisor of our San Diego National Service Office, I was promoted to 
Supervisor of our Chicago National Service Office in 2007, where I 
served until being promoted to my current position of Assistant 
National Service Director here in Washington, DC, on August 13, 2013. 
During my tenure at the Chicago VARO, I was fortunate to have been 
involved from the beginning with one of the first and most successful 
FDC programs. Working together with Regional Office Director Duane 
Honeycutt, VBA, DAV and other VSOs have made Chicago a model for other 
stations in how to execute the FDC program. I want to thank Director 
Honeycutt for his commitment to taking care of our nation's veterans 
and their families as demonstrated by the major improvements he has 
made in the Chicago VARO.
    Over the past several years, much attention has been rightly 
focused on efforts to reform VBA's claims processing system and reduce 
the unacceptable backlog of pending disability compensation claims, and 
today there are statistically significant signs of progress. DAV 
continues to advocate that the only way to truly address the current 
problems is by creating a new paperless system and culture focused on 
getting each claim done right the first time. VBA's transformation 
strategy focused on three areas: people, process and technology, and 
has for the most part been implemented nationally. The transformation 
has been comprised of dozens of initiatives, including new Challenge 
Training, Quality Review Teams (QRTs), the Veterans Benefits Management 
System (VBMS), eBenefits, the Stakeholder Enterprise Portal (SEP), the 
Transformational Organizational Model, Disability Benefits 
Questionnaires (DBQs), Simplified Notification Letters (SNLs) and the 
FDC program.
    Since the beginning of this year, the number of pending claims has 
fallen by about 120,000; the number of claims in the ``backlog'' (those 
pending more than 125 days) has fallen almost 25 percent from over 
600,000 to about 450,000; and the accuracy rate for rating claims has 
steadily risen from about 85 percent to more than 90 percent in the 
last three-month period measured. We commend VBA for the progress being 
demonstrated in reducing the backlog of claims; however, it is hard to 
determine how much of this progress is the result of the transformation 
strategy, and how much results from the increased productivity of new 
claims processors and mandatory overtime they are required to work. It 
is still too early to assess whether this transformation strategy will 
ultimately eliminate the backlog and reform the claims processing 
system; however, there is almost universal agreement that the FDC 
program has been a success and it must continue to be encouraged and 
expanded.
    The FDC began as a pilot program in 2009 at the VA Regional Office 
(VARO) in Chicago and several other locations with the intent to reduce 
the overwhelming volume of backlogged claims and provide veterans with 
a quicker route to getting a decision. Unlike many other initiatives 
with the same goal in mind, the FDC program is unique because the 
claimant is actively involved in the process, specifically with 
gathering the evidence needed to adequately reach a determination. 
However, this concept is not new. In fact, DAV and other VSOs have for 
decades been able to submit a complete ``fully developed'' or ``ready-
to-rate'' claim to VBA and DAV NSOs have long urged claimants to obtain 
as much of the evidence as possible prior to submitting the claim. 
However, prior to the inception of the current FDC program, claims that 
were considered ``fully developed'' or ``ready to rate'' were handled 
on a case-by-case basis and there was no formal program with standard 
procedures or consistency throughout VBA. As a result, even though 
these ``fully developed'' claims required less work by VBA and 
therefore should have resulted in quicker decisions, they were too 
often treated as just another claim, often sitting for months or years 
awaiting decisions. As such, this vital opportunity for VBA to process 
claims with much, if not all, of the development already completed when 
the claim was received, never really gained any acceptance, support, or 
cooperation between VBA and VSOs. VBA set out to change that with their 
new FDC pilot programs.
    The first obstacle to overcome was the time-consuming requirement 
of providing the claimant with a notice of their rights and VA's duty 
to assist them, based on the Veterans Claims Assistance Act (VCAA), 
commonly called ``VCAA notice.'' Upon receipt of a new claim, and upon 
receipt of any additional evidence submitted by the veteran, VBA would 
send out a VCAA letter, consuming months without any significant 
progress in adjudicating the claim. For the FDC program to have any 
chance of becoming a fully integrated practice, VBA first had to 
overcome the hurdles of providing the claimant a timely VCAA notice, 
and full understanding, cooperation and communication within the VARO 
and partnership with VSOs and stakeholders. Creating special ``EZ 
Forms'' and providing the VCAA notice along with the application to a 
claimant allowed the first hurdle to be overcome.
    Originally, the FDC program was limited to claims filed using a VA 
Form 21-526EZ, Fully Developed Claim (Compensation), and 21-527EZ, 
Fully Developed Claim (Pension). VBA later added the VA Form 21-534EZ, 
Fully Developed Claim (Death Benefits). These three VA forms, known as 
the ``EZ Forms'' are the only forms that can be used to file an FDC 
claim, as each form describes the evidence necessary to prove certain 
compensation and pension claims and fulfills the Duty to Notify 
requirements pursuant to title 38, United States Code, section 5103. 
Claimants must use one of the prescribed ``EZ Forms'' or the electronic 
version through VONAPP Direct Connect (VDC) in order to participate in 
the FDC process; otherwise their claims will be processed under the 
traditional claims process.
    Additionally, the FDC application will require the claimant to:

    1. Certify that the information or claim submitted is truthful;

    2. Acknowledge receipt of the VCAA, which is part of the 
application;

    3. Attest to the completeness of the claim and that there is no 
additional evidence; and

    4. Provide authorization to VA for release of information required 
to process the claim.

    Should a claim not contain these basic elements to qualify for FDC 
participation, the claim would be excluded from the FDC program and be 
processed under the traditional claims process.
    A second important obstacle to overcome was ensuring that veterans 
who took it upon themselves to assemble their complete claims files, 
including hard-to-gather private medical evidence, would not lose out 
on their effective dates if they waited to file a FDC. To do so, VBA 
had to develop an ``informal'' FDC procedure, similar to what can be 
done for a regular information claim, which allows a veteran to 
``perfect'' their claim up to one year from the date of their 
information claim, and still have benefits based on the effective date 
of that informal claim.
    In the FDC program, upon initial contact, during which the VA Form 
21-22 (POA) is received, an incomplete application (informal FDC) is 
filed to maintain the effective date for any possible future claims. 
DAV's NSOs are directed to always initiate an informal FDC if any 
potential development may be needed. A formal FDC is only filed once 
all information is obtained and reviewed by an NSO within 12 months of 
the VARO receiving an informal FDC, which ensures preservation of the 
effective date. Claimants have one year from the date the informal FDC 
is submitted to VARO to submit a formal FDC, and by VBA's direction, it 
is imperative that the claimant not specify any particular issues or 
conditions within the informal FDC memorandum. The purpose of the 
informal FDC is to allow a claimant to establish the intention of 
participating in the FDC process and establishing the earliest 
effective date possible while the claimant proceeds with obtaining 
necessary evidence to be submitted as a formal FDC claim. If the 
claimant specifies any issues or conditions within the informal FDC 
memorandum, VBA must consider it as a formal claim and will result in 
being adjudicated under the traditional process.
    Before a VA Form 21-526EZ, 21-527EZ, or 21-534EZ is submitted, all 
additional evidence and information that would have originally been 
acquired or requested through a traditional claims process is reviewed 
in depth by an NSO and then submitted as a complete application. This 
is important, as it may allow for additional claims such as secondary 
issues to be filed while maintaining the effective date as the date of 
receipt the informal FDC was received. Additional evidence and 
information includes, but is not limited to, the following: private 
treatment reports from non-VA facilities, personal statements, lay 
statements, additional VA Forms, medical opinions, and Disability 
Benefits Questionnaires (DBQs).
    Moreover, before filing a claim through the formal FDC process, 
NSOs ensure the claimant has no claims pending, which will exclude a 
claimant from the FDC process. Likewise, if the claimant has an appeal 
pending, NSOs ensure the actual claims folder, or C-File, is not 
located at the Board of Veterans' Appeals (Board), as this will also 
exclude a claimant from the FDC process. Based on my experience in 
Chicago, as well as having visited other DAV offices actively engaged 
in promoting the FDC program, there are some best practices for both 
VBA and VSOs that we believe can really make this program even more 
effective across the nation.
    First, to make this partnership work, every VARO must have a 
dedicated FDC Program Coordinator (PC) who's primary, and perhaps only, 
responsibility is to make the FDC program a success. In the Chicago 
VARO, the FDC PC on staff is invaluable to the program and a vital 
conduit between VBA, the claimant and VSOs. The FDC PC is responsible 
for the integrity of the FDC program, for identifying and monitoring 
pending FDCs through the VETSNET Operations Reports (VOR); and for case 
managing any individual FDCs pending near 90 days or longer. The FDC PC 
is also responsible for locating and retrieving FDC claims folders, 
reviewing FDC development actions, and also delivering FDC claims 
folders for expedited processing. The FDC PC must be willing and able 
to carry out whatever is necessary to get these claims completed as 
quickly as possible, which is the key to motivating veterans to file 
FDC claims in the first place. While I know firsthand how important the 
FDC Program Coordinator is to the process at the Chicago VARO; I am not 
certain that other VAROs have taken this same approach. DAV believes it 
is essential to have at least one knowledgeable FDC PC at each VARO to 
assist with all inquiries and ensure the FDC program is operating as 
intended. Furthermore, the Service Center Manager must ensure that the 
FDC PC is provided all the time they require to manage the FDC program, 
without being pulled away from that primary work in order to help 
address deficiencies in other areas of the VARO, or to help reach 
short-term productivity goals.
    Another major obstacle in the FDC process has been the exclusion 
process, or the act of removing or disqualifying a claim from the FDC 
program, due to such reasons as not submitting sufficient private 
medical evidence, submitting additional claims, failing to report for a 
VA medical examination, or using the older (2010) version of the 21-
526EZ form. Any one of these issues, or similar, would be reason for a 
claim being disqualified, because each of these acts or omissions 
results in additional development work by VBA, which defeats the intent 
of the FDC. However, too often VAROs were removing claims from the FDC 
program for reasons that could have been easily avoided by contacting 
the claimant directly or VSO service officer and requesting any 
identified but missing evidence, or for other simple matters such as a 
missing signature.
    Working with DAV and other VSOs, VBA has been able to reduce the 
amount of FDC exclusions, which was unacceptably high in the beginning. 
VBA has increased their efforts and communication with the claimant or 
VSO when a claim is identified as not qualified for the FDC program. In 
Chicago, the VARO contacts our DAV NSOs prior to a claim being removed 
from the program to allow us the opportunity to resolve the issue and 
avoid its removal. Take for example a claimant who has submitted a FDC 
for an increased evaluation for a back condition, but who later submits 
additional radiological evidence of the back condition. Previously, 
this action would have prompted removal from the FDC program; however, 
in Chicago, the VARO employee contacted our NSO, indicating that 
because the evidence required no additional development, there would be 
no reason to remove it from the program. This type of effort, 
communication, and partnership is vitally important not only to the FDC 
program, but to reforming the entire VBA disability claims process.
    The most important change necessary for maximizing the use and 
success of the FDC program is the full commitment and participation of 
VBA, VSOs and veterans. Earlier this year, DAV, along with The American 
Legion, joined with VA to establish the FDC Community of Practice, 
dedicating ourselves to maximizing the use and success of the FDC 
program. As Under Secretary Alison Hickey is fond of saying, VBA is 
``all-in'' when it comes to the FDC program.
    I saw firsthand at Chicago how much difference it makes when you 
have this type of complete ``buy-in'' amongst the VARO staff and VSOs. 
A great deal of the credit for this must go to Director Honeycutt, 
whose positive approach and belief in the FDC program, and his 
enthusiastic desire to assist our nation's wounded, ill and injured 
veterans profoundly reshaped the claims process in Chicago. In addition 
to drastically reducing the claims processing time overall, the number 
of appeals initiated at the Chicago VARO has also been significantly 
reduced over the past four years, and DAV has been proud to be a major 
partner in this effort.
    According to DAV analysis, in 2009, the Chicago VARO FDC pilot 
program yielded an average processing time of 78 days for 25 percent of 
the FDC claims submitted, while 50 percent were rated within 130 days. 
This was improved in 2010, when 25 percent of FDC claims were rated 
within 69 days and half were decided within 115 days. Moving forward 
with the FDC program nationally, the participation continues to 
increase, while the number of claims excluded from the FDC is 
decreasing.
    Data received from the VBA reflects that, during the first quarter 
of fiscal year (FY) 2013, of the total number of claims submitted by 
our Chicago DAV National Service Office, 21 percent were qualified FDC 
claims. At the end of the second quarter, the percentage of FDC claims 
increased to 25 percent and by the end of the third quarter of FY 2013, 
the percentage of qualified FDC claims submitted by DAV dramatically 
increased to 38 percent of all claims being filed through our NSOs.
    In our opinion, a major reason for the dramatic increase between 
the second and third quarters of FY 2013 is due to the decrease in the 
number of claims being excluded from the FDC program, which is 
attributed to the improved communication between VARO staff and DAV 
NSOs, allowing us the opportunity to contact the claimant and resolve 
the issue and keep the claim in the FDC program. To date, approximately 
22 percent (10 percent nationally) of the total claims processed at the 
Chicago VARO are claims submitted through the FDC program with an 
average processing time of 105 days. DAV is very optimistic about the 
continued increase in FDC participation largely due to the program and 
its positive results becoming more known in the veterans' community.
    DAV believes that the most important factor in making the FDC 
program work is educating and communicating directly with the claimant. 
Communication and cooperation are imperative to the FDC process, which 
is why DAV NSOs have direct interaction with claimants at all stages 
throughout the process. NSOs provide claimants with specific guidelines 
on the proper development of an FDC, and as a general rule, all 
claimants are requested to contact the assisting NSO office no later 
than 60 days following the submission of an FDC. Additionally, once a 
decision has been reached by VBA, DAV NSOs proactively contact our 
claimants to explain the decision. The education and communication with 
our clientele have been largely responsible for the success in the FDC 
claims process and has also resulted in fewer appeals being initiated, 
or Notices of Disagreement (NODs), being filed. An additional study DAV 
completed in Chicago between 2009-2011 harvested results indicating 325 
NODs had been submitted in 2009 and dramatic reduction to 61 NODs being 
filed in 2011, which is an astonishing decline of approximately 82 
percent.
    DAV has assisted VBA greatly in promoting the FDC process to the 
veterans' community in hope of encouraging more participation, thereby 
avoiding claims entering the traditional process and lengthy backlog 
delays. In addition to promoting the FDC program through the DAV 
website, magazine, literature, meetings, conferences and other means, 
NSOs introduce DAV clients to the FDC process through formal 
orientation classes and/or by explaining the difference between an FDC 
and a traditional claim. Currently, DAV provides these orientation 
classes in approximately five locations, but we are hopeful to expand 
this to all of our offices.
    In Chicago, these DAV-led orientation classes are held weekly and 
are offered to potential claimants or anyone interested in learning 
more about the FDC process, including VARO employees and other VSOs. 
Orientation classes may vary in size, up to 20 to 25 participants and 
representation by DAV is not required. In fact, claimants represented 
by other VSOs participate in the orientation classes to gain valuable 
information and ask questions about the FDC process. As part of a local 
agreement between VSOs, DAV does not solicit participants for 
representation if they are currently represented by another VSO.
    During DAV-led orientation sessions, NSOs advise clients of their 
options in regards to an informal FDC and how future claims received 
under the FDC process will not affect the established effective date. 
Additionally, participants are provided detailed requirements of what 
is needed for a complete FDC, such as service treatment records, 
private medical records, personal statements, lay testimony, etc., 
which will allow for greater success. The importance of good 
communication and cooperation is stressed. Once a claimant understands 
the process and the type of information or evidence needed to be 
successful in a claim, such as obtaining a completed DBQ or records 
from their private physician(s), the more excited a claimant is to be 
engaged with their claim throughout the process. It cannot be 
overemphasized: the majority of claimants want to be involved with 
their claim and are more than willing to obtain the necessary 
information, rather than simply submitting a claim with no supporting 
information and waiting to receive a decision.
    Also, as part of the discussion during orientation, or even one-on-
one interviews, DAV NSOs ensure that all clients understand the 
importance of attending any scheduled VA examinations and the 
importance of not submitting any additional claims or information 
requiring development after the FDC has been submitted, as any of these 
will exclude a claimant from the FDC process. DAV NSOs also ensure 
claimants are fully aware and informed of any VA literature and 
websites regarding the FDC.
    Finally, in order for the FDC program to continue being successful, 
full cooperation and communication between VA, the claimant and VSOs is 
imperative. During the early days of the FDC program, when claims would 
be excluded from the FDC, neither DAV NSOs nor the claims would be 
notified that their claim was no longer in the FDC program. In many 
cases, we would later discover that this exclusion had taken place, 
although it could have easily been avoided had VBA simply communicated 
with our NSOs. In Chicago, in an unprecedented approach, Director 
Honeycutt reached out to DAV and offered to contact our NSOs by email 
when a case was being prepared for exclusion from the FDC. This simple 
communication bridge allows the NSO the opportunity to contact the 
claimant and can often resolve simple problems, such as missing 
signatures, thereby allowing the claim to remain in the FDC.
    Mr. Chairman, DAV believes the FDC program has been very successful 
and has had a major impact on reducing the backlog of disability 
claims. We know the FDC program will continue to improve as VBA and 
VSOs continue seeking to improve our roles, and in that regard, DAV 
would offer the following recommendations.
    First, VAROs need to clearly designate one individual to serve as 
the FDC coordinator, and VARO Directors must ensure that this person is 
provided adequate time and resources to successfully work with VSOs to 
address problems with submitted FDCs as they arise. This person must 
not be diverted away from their FDC responsibilities to address gaps in 
regular claims processing, particularly if such a change were being 
done to make short-term boosts in productivity just to show momentary 
progress in reducing the backlog.
    Second, VBA should revise its national policies on excluding claims 
from the FDC process so that when a veteran files a FDC and later 
submits additional evidence that does not require any development, the 
claim should remain in the FDC program. This process has worked very 
successfully in Chicago and some other VAROs, and we believe it should 
be formalized as a national policy.
    Third, VBA should not remove claims from the FDC program if VBA 
determines that secondary claim can be inferred based on the evidence 
received. When a claimant fulfills all their obligations to file a FDC, 
actions taken by VBA in satisfying the law should not become a reason 
to remove that claim from the FDC program. It will not help the veteran 
and it will not help the FDC program.
    Fourth, VBA must continue to encourage and support the use of 
private medical evidence in order to eliminate the time and resources 
required to administer compensation medical exams. VBA has taken 
significant actions to encourage private evidence, such as the 
development and use of DBQs and the Acceptable Clinical Evidence (ACE) 
initiative, however there still remains resistance in some VAROs from 
some employees to give private medical evidence the same weight as VA 
medical evidence.
    Fifth, one concrete way to advance private medical evidence would 
be for VBA to release all DBQs for veterans' private treating 
physicians to complete, particularly those designated for medical or 
nexus opinions and for assessing PTSD.
    Sixth, VBA and VHA must reach an agreement and quickly implement 
new procedures to ensure that all VHA-treating physicians are required 
to complete DBQs for veterans upon request. Today, many VHA treating 
physicians are being told that they either should not, or may not have 
to fill out DBQs for their patients.
    Finally, DAV urges Congress to pass legislation amending current 
law by requiring VA to give equal weight to private medical evidence 
that is competent, credible, probative, and otherwise adequate for 
rating purposes; the same weight as VHA-provided medical evidence.
    Mr. Chairman, this concludes my statement and I would be happy to 
answer any questions from you or members of the Subcommittee.

                                 
                 Prepared Statement of Diane M. Zumatto

    Good afternoon Chairman Miller, Ranking Member Michaud, and 
committee thank you for this opportunity to allow AMVETS to voice both 
our praise and concerns regarding VA's efforts to reduce the backlog of 
claims that have been pending for more than 125 days via the Fully 
Developed Claims (FDC) program. AMVETS supports and applauds VA's 
stated goal of eliminating the backlog of compensation claims by the 
end of 2015.
    Looking back in time, we see evidence that the backlog of 
compensation claims has been growing steadily since 2009. 
Notwithstanding the fact that VA completed a record-breaking 1 million 
claims per year in fiscal years 2010 - 2012, the number of claims 
received continues to exceed the number processed.
    In response to what appears to be a systemic problem, VA has begun 
implementing a comprehensive Transformation plan--a series of people, 
process and technology initiatives--to increase productivity and 
accuracy of disability claims processing. The FDC program is one 
element of this transformation and it is hoped that, once fully 
implemented, that it will substantially contribute to the elimination 
of the backlog by the 2015 goal.

What Is a Fully Developed Claim?
    The Fully Developed Claims (FDC) program is an optional new 
initiative that offers Servicemembers, Veterans, and survivors faster 
decisions from VA on compensation, pension, and survivor benefit 
claims.
    Veterans, Servicemembers, and survivors simply submit all relevant 
records in their possession, and those records which are easily 
obtainable, such as private medical records, at the time they make 
their claim and certify that they have no further evidence to submit. 
VA can then review and process the claim more quickly.
    Filing a FDC is typically the fastest way for veterans to receive a 
decision on their claims since they are required to provide all 
supporting evidence in their possession when they originally submit 
their claims. Often, this is evidence that VA legally must attempt to 
collect on the veteran's behalf, which may already be in the veteran's 
possession, or is evidence the veteran could easily obtain. When 
veterans submit all such evidence with their original claims, it 
significantly reduces the amount of time VA spends gathering evidence 
from them or other sources, which is often the longest part of the 
claims process.
    While VA will still makes efforts to obtain federal records on the 
veterans' behalf, the submission of non-federal records, and any 
additional federal records the veteran may have, with the claim allows 
VA to issue a decision to the veteran more quickly. Typically, VA 
processes FDCs in half the time it takes for a traditionally filed 
claim, therefore FDCs help eliminate VA's claims backlog because they 
increase production of claims decisions and decrease waiting times. 
Also, VA assigns FDCs a higher priority than other claims which also 
leads to veterans receiving decisions to their claims faster than 
traditional claims.
    The VA continues to prioritize other specific categories of claims, 
including those of seriously wounded, terminally ill, Medal of Honor 
recipients, former prisoners of war, the homeless and those 
experiencing extreme financial hardship. As part of its drive to 
eliminate the claims backlog in 2015, the VA also gives a priority to 
claims more than a year old.
    The concept of the FDC program has been moderately successful in 
its ability to assist VA in reducing the backlog of pending claims. 
According to the Veteran Benefits Administration's (VBAs) Monday 
Morning Workload Report (MMWR), a weekly compilation of performance 
measures for the processing of Disability, Pension and Education 
benefits, under the FDC program, the number of claims have dropped from 
the high water mark of 919,461 on the 16 July 2012 to the current level 
of 760,820 pending claims on the 24 August 2013. Additionally, the 
number of claims in the backlog has declined from 633,469 on 25 March 
2013 (according to the MMWR) to 459,998 on 31 August 2013 (according to 
the MMWR).
    A very real need has always existed for the VA's external partners 
to assist VA by providing them with complete claims packages on behalf 
of their clients. This allows VA to receive the claim and proceed to 
rating it with a minimum of additional development. Years ago these 
were called ready-to-rate (RTR) claims.
    A ready-to-rate claim included every piece of evidence needed for a 
VA rater to begin rating a claim. This included the application for 
benefits correctly completed; a certified copy of the veteran's 
DD214(s), any and all service medical records; civilian treatment 
records if appropriate; and all necessary documents to verify the 
veteran's dependents. The only thing the VA might have to do is to 
request a compensation examination to clarify the status of a 
condition. An example would be a veteran who is claiming an orthopedic 
condition in a major joint. 38 Code of Federal Regulations requires a 
range of motion study so the rating official can determine the 
appropriate percentage of disability to assign for the condition if 
service connection is granted.
    VA drifted away from the ready-to-rate claim and devised the FDC 
initiative; however, we feel this is inaccurate, since the title 
implies a complete claims package; however dependents have been 
stripped out of the claim.
    FDCs ``achieved'' production synergies by stripping the veteran's 
dependents information from the claim form. This was most likely done 
to ``save keystrokes.'' Notification of a veteran's dependents is now 
contained under the second bullet in the special circumstances section 
or ``the small print'', of the instructions on the first page of the VA 
Form 21-526EZ. The bullet instructs a veteran to attach a VA Form 686c 
if they have dependents.
    The problem now is that the dependents are no longer part of the 
claim; instead, they have been relegated to an award adjustment action. 
Adding dependents to a veteran's claim now falls under an entirely 
different end product code than the claim. We look at this as robbing 
Peter to pay Paul. It is also an ineffective and less efficient way to 
work, since a claim with dependent(s) must now be touched multiple 
times instead of only once before it is finalized and authorized. 
Additionally, telephone calls and written correspondence concerning the 
status of the veteran's dependents must now be addressed separately, or 
``placed on the back burner'' as has evidently happened. The need to 
now respond to two separate status requests, rather than just one is 
leading to an increasing workload.
    Since the FDC started in May 2010, the number of pending dependents 
issues has increased from a monthly average of 40,000 to 205,467 as of 
the 24 August 2013 MMWR. The increase in the pending dependents ``award 
adjustment actions'' this new dependents backlog coincides exactly with 
the start of the FDC. I say this because the increase in the number of 
pending dependents issues started in August 2010, 90 days after 
implementation (which is the same amount of time VA raters have to 
complete and promulgate FDC rating decisions) of the FDC program which 
started in May 2010.
    We at AMVETS have a major concern with the new backlog of 
dependents award actions. The 205,467 pending issues are the ones VA 
has identified. How many veterans who are entitled to dependents 
allowance have not been identified? This number is a complete unknown. 
If they do not find out about this benefit and file to add their 
dependents more than one year after the original decision, the benefits 
will be paid from the month the request was filed. Since the request is 
more than one year after the decision, it would not retroactive.
    The removal of dependents rom the application does not make sense 
for the veterans. VA's own annual reports since 2005 show that for the 
majority of rating decisions veterans qualify for dependents allowance. 
This has steadily climbed from 51% in 2005 to 56% as noted in the 2011 
annual report, the most current annual report available.
    AMVETS fully supports the submission of complete claims packages, 
as we are aware that any other position hurts our veterans and the VA 
employees working those claims. Additionally, it is of critical 
importance that sufficient funds be allocated to manage the backlog and 
multiple levels of oversight as part of the VA's attempt to correct 
this situation. We cannot do the VA's job for them, but AMVETS can and 
will, support any and all efforts that facilitate their efforts.
    I would like to conclude by noting for the record, that AMVETS 
fully supports both Secretary Shinseki and Under Secretary for Benefits 
Hickey. Both of these leaders have struggled to fulfill their 
obligations to their fellow veterans thanks to the antiquated civil 
service system current in place. While we appreciate that this system, 
and its attendant protections, was originally established to rightly 
protect against patronage, worker exploitation, and political 
manipulation. But instead of protecting the best employees and creating 
an environment in which excellence can thrive, civil service 
protections now serve to lock the worst employees into place, making it 
virtually impossible for managers to fire poor performers. Neither VA 
Secretary Eric Shinseki, nor any future VA secretary, can be fully 
expected to fix a system in which they are unable to fire bad employees 
and reward good employees based on merit (instead of tenure). We need 
to give the VA's leadership the tools they need to fix the system.
    These conclude my remarks. Thank you Mr. Chairman.

Attached Graphs:
    Pending Claims and the Claims Backlog: July 1999 to Present
    Dependency Issue Backlog: December 2009 - August 2013
    Percentage of Claims Qualifying for Dependents Allowance: 1999 - 
2011
Disclosure
    9 September 2013

    The Honorable Representative Jeff Miller, Chairman
    U.S. House of Representatives
    Committee on Veterans' Affairs
    335 Cannon House Office Building
    Washington, D.C. 20510

    Dear Chairman Miller:

    Neither AMVETS nor I have received any federal grants or contracts, 
during this year or in the last two years, from any agency or program 
relevant to the February 15, 2012, House Veterans Affairs Committee 
hearing on the U.S. Department of Veterans Affairs Budget Request for 
Fiscal Year 2013.

    Sincerely,

    Diane M. Zumatto, AMVETS
    National Legislative Director
Biographical Sketch
    Diane M. Zumatto of Spotsylvania, VA joined AMVETS as their 
National Legislative Director in August 2011. Ms. Zumatto, a native New 
Yorker and the daughter of immigrant parents decided to follow in her 
family's footsteps by joining the military. Ms. Zumatto is a former 
Women's Army Corps (WAC) member who was stationed in Germany. Zumatto 
was married to a CW4 aviator in the Washington Army National Guard and 
is the mother of four adult children. Ms. Zumatto is extremely proud 
that two of her children have chosen to follow her footsteps into 
military service.
    Ms. Zumatto has more than 20 years of experience working with a 
variety of non-profits in increasingly more challenging positions, 
including: the American Museum of Natural History; the National 
Federation of Independent Business; the Tacoma-Pierce County Board of 
Realtors; the Washington State Association of Fire Chiefs; Saint 
Martin's College; the James Monroe Museum; the Friends of the 
Wilderness Battlefield and the Enlisted Association of the National 
Guard of the United States. Diane's non-profit experience is extremely 
well-rounded as she has variously served in both staff and volunteer 
positions including as a board member and consultant.
    After receiving her B.A. in Historic Preservation from the 
University of Mary Washington in 2005, Diane decided to diversify her 
experience by spending some time in the `for-profit' community. 
Realizing that her creativity, energy and passion were not being 
effectively challenged, she left the world of corporate America and 
returned to non-profit organization.

    AMVETS National Headquarters
    4647 Forbes Boulevard
    Lanham, Maryland 20706-4380
    Business Phone: (301) 683-4016
    [email protected]

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       Prepared Statement of Admiral W Clyde Marsh, USN, Retired

                              INTRODUCTION

    Mr. Chairman and distinguished members of the committee, my name is 
Clyde Marsh, President of the National Association of State Directors 
of Veterans Affairs (NASDVA) and Director of the Alabama Department of 
Veterans Affairs. I am honored to present the collective views of the 
State Directors of Veterans Affairs for all 50 states, the District of 
Columbia, and five U.S. Territories on the implementation of the very 
important Fully Developed Claims (FDC) program. Here with me today are 
Les Beavers - Kentucky, past NASDVA President, and State Director, 
Randy Reeves - Mississippi.
    Nationally, we are second only to U.S. Department of Veterans 
Affairs (USDVA) in providing services to veterans and our roles 
continue to grow. Our duties include honoring and working with all 
veterans and their family members and the various Veterans' Service 
Organizations (VSO) both within our states and nationally. We have a 
formal partnership with USDVA through a Memorandum of Understanding 
(MOU) with Secretary Shinseki signed in February 2012. The MOU pledges 
the two organizations to maintain effective communications, an exchange 
of ideas and information, identification of emerging requirements, and 
continuous reevaluation of existing veterans' programs to meet today's 
needs.
    As governmental agencies, our Governors, State Boards and/or 
Commissions task their respective State Departments of Veterans Affairs 
(SDVA) with the responsibility of addressing the needs of our veterans 
and their families particularly in our role as advocates. We are 
charged with the duty of processing veterans' claims for disability 
compensation, pension and survivor benefits. On a daily basis, State 
Directors and their staffs are confronted with unique situations, which 
often need to be addressed in an urgent manner. As you well understand, 
delivery of meaningful services and support is best coordinated at the 
local level.

               SUPPORT FOR FULLY DEVELOPED CLAIMS PROGRAM

    NASDVA strongly supports the concept, methodology and strategy 
undertaken by the Veterans Benefit Administration (VBA) in the current 
FDC Program as one of several means to reduce the current veterans' 
claim backlog while also reducing claims processing completion times. 
To help facilitate success of the FDC program, each state will endeavor 
to provide specific mission guidance, goals and checklists to increase 
both the quantity of submissions as well as the quality of claims. In 
addition to our association's support, to date over three-fourths of 
the states and territories have submitted individual letters to the 
Undersecretary for Benefits in support of FDC.
    The FDC goal of providing a response to claimants within 90 days, 
which we strongly support, will go a long way toward reduction of the 
current claims backlog and give veterans a reasonable expectation on 
the time to process individual FDC claims. Transparency will be 
particularly important to ensure veterans' confidence in this process.
    NASDVA is in complete agreement with the allowance within Public 
Law 112-154 that provides for up to a one-year retroactive effective 
date for awards of disability compensation. This change further creates 
confidence in the program since it negates the need for veterans to 
submit informal claims for the sole purpose of establishing ``date of 
claim'' affecting retroactive compensation payment(s). As advocates for 
veterans, we accept the responsibility of helping our veterans to 
understand that they are certifying to the truthfulness of the 
information and they are authorizing release of information necessary 
to enable a rating decision. Likewise, the submission on the VA EZ 
form(s) meets the requirement for ``duty to notify'' as required by 
Title 38 U.S.C. Sect. 503. It is understood that individual veterans, 
too, have a responsibility to submit all required evidence with their 
claim.
    We believe all veterans, regardless of where they reside, should 
have equal access to federal and state benefits and services and that 
federal and state governments must collaborate to achieve this goal 
nationally. The local relationships between SDVAs and VSO offices with 
VA Regional Offices (VARO) are critical. Many areas of the country are 
still underserved due to veterans' lack of information and awareness of 
their benefits. This directly impacts our veterans' ability to 
effectively access the VA claims process.
    The USDVA and SDVAs must continue to work together to reduce this 
inequity by reaching out to veterans with information and make every 
effort to assist them in filing FDCs. Steps should be taken to make 
disability processing less confusing, eliminate payment inequities and 
provide a foundation with appropriate incentives for injured veterans 
to return to a productive life.

               FULLY DEVELOPED CLAIM PROCESS IN THE FIELD

    NASDVA recommends an increased role for SDVAs in the overall effort 
to manage and administer claims processing, regardless of whether the 
state uses state employees, nationally chartered veterans service 
organizations (VSO) and/or county veterans service officers (CVSO). 
Collectively, we have the capacity and capability to assist the 
Veterans Benefit Administration (VBA). Additionally, a collaborative 
effort should take place on the establishment of standards for 
training, testing, and accrediting service officers to include 
continuing education and performance standards. We can support VA in 
their ``duty to assist'' without diminishing our role as the veterans' 
advocate.
    USDVA needs to encourage veterans to use the assistance of SDVAs, 
VSOs and CVSOs in submitting all claims. Assistance from trained 
service officers will help ensure claims are submitted with all the 
supporting documentation necessary to support or substantiate the 
claim. This will help eliminate requests for clarification or missing 
information and reduce rejects/remands. The desired result will be 
expedited processing without distractions or delays due to process 
errors, incomplete files and missing information or medical 
documentation.
    Over the past two years, several states have taken the lead in 
developing strategies and processes that have integrated the FDC 
process into their claims operations. One example that has yielded 
significantly positive results is the Texas Veterans Commission's (TVC) 
state funded initiative that included a 32 Veteran Service Officer 
``Strike Force'' to help reduce the VA claims backlog and a 28 member 
team to file FDCs. Specifically:

      In August 2012, TVC dedicated over half of its Strike 
Force effort to the FDC process by creating the Fully Developed Claims 
Teams. Of the total Strike Force, 28 (dedicated) TVC Fully Developed 
Claims Team members work to ensure that newly filed claims are filed as 
FDCs.
      In May 2013, during its annual Spring Training 
Conference, TVC provided four (4) days of concentrated, in-depth 
training on FDCs to over 240 State and County Veterans Service Officers 
from around the state.
      To date, the TVC has submitted 8,868 claims to the VBA 
for processing as FDCs. TVC's efforts have yielded over 71% of FDCs in 
the Waco VARO and over 60% in the Houston VARO.

    Similar efforts, of varying scope, are ongoing in states 
nationwide. It must be understood, however, that resources, legislative 
authority, organizational structure and operating procedures do vary 
significantly from state to state. To the degree they are individually 
able, NASDVA's member states are resolved to fully support the FDC 
process.

              ITEMS CRITICAL TO SUCCESS OF FDC INITIATIVE

    As with any new program and/or initiative there are areas within 
the FDC process, including policy, where continued discussion, close 
coordination thoughtful monitoring will be required. NASDVA and its 
individual states appreciate and are committed to continued open 
dialogue and cooperation with individual State Regional Offices, VBA, 
USDVA and Congress to improve the process of serving our Nation's 
veterans. We ask that attention be given to the following areas:

      A component of the FDC process is the Disability Benefits 
Questionnaire (DBQs). DBQs need to be simplified and shortened for 
simple conditions.
            b  DBQs are too complicated and lengthy, especially for 
simple conditions.
            b  If physicians (including VA physicians) are refusing to 
complete them, as we frequently hear, then their value to the FDC 
process is lost.
      The FDC works because it provides incentive for veterans 
to take the time to ensure their claim is fully developed, prior to 
filing. In exchange veterans expect, in accordance with expectations 
set by VA, for the process to take less than 90 days. There is still 
work to be done on this. For example, although much progress has been 
made, in Texas the Houston VARO currently averages 101.3 days 
processing FDCs while the Waco VARO averages 130-145 days. In most 
states, the FDC process is comparatively new but the comparisons are 
very similar. NASDVA and USDVA must continue to be vigilant to ensure 
the process can meet the expectations of our veterans as submissions of 
FDCs increase.
      Our veterans have a reasonable expectation that once a 
claim is submitted and accepted as a FDC that it will remain in that 
process. USDVA must be committed to making sure veterans know, as soon 
as possible, their claim has been fully accepted as a FDC and they will 
have a decision in 90 days. We do recognize that there are legitimate 
reasons for exclusion from the process such as: the veteran needs non-
federal evidence development, evidence received after FDC established, 
claimant declined FDC or VBA administrative reason (e.g. wrong form 
received, not signed, etc.). However it is critical that VBA promptly 
notify the veteran and his representative early in the process and that 
VBA be flexible in that process. A good example of flexibility is, as 
in the case of missed appointment, finding out why and making every 
effort to work with the veteran. However, we appreciate that in the 
event the claim is not eligible for FDC, there will be no harm to the 
veteran's claim as it will be processed as a normal claim.
      E-Benefits makes it possible for veterans to file claims 
on their own.
            b  The layout of the current E-Benefits website does not 
adequately convey the importance of representation in the claims 
process. VBA needs to encourage veterans to seek representation so that 
FDCs are filed properly.
            b  VBA needs to ensure that the Stakeholder Enterprise 
Portal (SEP) within E-Benefits is working properly.
      Outreach and training are critical to the success of the 
FDC Program. ROs have clearly been instructed to provide FDC training, 
as outlined in VBA Fast Letter 12-25 (revised 8-13-2013), to VSOs. This 
should also apply to SDVAs and CVSOs. Any future instructional Fast 
Letters should, specifically include SDVAs and CVSOs. FDC Program 
Coordinators at the ROs should also be responsible for outreach and 
training.
      The Veterans Benefits Management System (VBMS) which is 
now in place nationally in all VAROs will take us from mountains of 
paper to a digital data claims system as well as provide instant 
connectivity and easier access. The full implementation of VBMS is 
vital to improvement of the claims process in general and to the FDC 
program specifically.

                               CONCLUSION

    Mr. Chairman and distinguished members of the VA committees, we 
respect the important work that you are doing to improve support to 
veterans who answered the call to serve our great country. State 
Directors of Veterans Affairs remain dedicated to doing our part, but 
we urge you to remember the increasing financial challenge that states 
face, just as you address the fiscal challenges at the national level. 
I would like to emphasize again, that we are partners with federal VA 
in the delivery of services and care to our nation's patriots. State 
Directors are veterans' advocates that help veterans receive support 
and essential benefits they have earned through their honorable 
service.
    As procedures and policies are adopted within the FDC Program, 
NASDVA looks forward to participating as partners and requests to be 
involved in the rulemaking process with VBA and USDVA. Since FDC is an 
evolving program, we will continue to provide feedback for enhancement 
of the program, which will ultimately benefit affected veteran 
claimants. As you all are keenly aware, how well the FDC program is 
administered will mean nothing without continued funding for USDVA 
programs so that granted claims can be promptly paid.
    Thank you for including NASDVA in these very important hearings.

                                 
                       Statements For The Record

                     PARALYZED VETERANS OF AMERICA

    Chairman Runyan, Ranking Member Titus, and members of the 
Subcommittee, Paralyzed Veterans of America (PVA) would like to thank 
you for the opportunity to offer our views on the Fully Developed 
Claims' process and the initiation of the one year look-back for 
benefits, which took effect on August 6, 2013. The claims backlog has 
been challenging the Department of Veterans Affairs (VA) for years and 
PVA appreciates you conducting this hearing to examine the issue.
    Over the next several years, an estimated 1.2 million active duty 
service members will separate from the military and be welcomed home 
only to fall in line behind veterans who have been awaiting a decision 
on their VA claims. Of these claims, 66 percent have been 
``backlogged'' for more than 125 days, according to March 2013 
Government Accountability Office (GAO) testimony before Congress. The 
claims backlog, those cases pending 125 days or longer, stands at 
490,000, which is down from the 530,000 reported on June 15, 2013. VA 
says its total claims inventory of 773,000 is the lowest since April 
2011, and down from 808,000 on June 15. Those 490,000 claims in the 
backlog, combined with an anticipated wave of new claims as operations 
in Afghanistan wind down and the military downsizes, raise concerns 
about the feasibility of meeting VA Secretary Eric Shinseki's 2015 
target goal of eliminating the backlog and adjudicating all VA claims 
in 125 days or less.
    The Veterans Benefits Administration (VBA) continues to implement 
several initiatives to meet the Department's goal of eliminating the 
claims backlog in 2015. In April 2013, the VA launched an initiative to 
expedite disability compensation claims decisions for veterans who have 
waited a year or longer. In the following month, the VBA announced that 
it was mandating overtime for claims processors in its 56 regional 
offices to increase production of compensation claims decisions through 
the end of fiscal year 2013. As a result of these initiatives, the 
VBA's total claims inventory has declined to a level not seen since 
August 2011. The number of claims in the backlog has been reduced by 17 
percent compared to the highest point in March 2013.
    One particular initiative, the Fully Developed Claims (FDC) 
program, has purportedly played the most significant role in reducing 
the backlog. Fully developed claims require veterans to provide all 
supporting evidence in their possession when they submit their claims. 
Often, this evidence is already in the veteran's possession, or is 
evidence the veteran could easily obtain, such as private treatment 
records. By submitting this evidence with their claims, veterans 
significantly reduce the amount of time VBA spends gathering evidence 
from them or other sources, often the longest part of the claims 
process. The FDC process is being touted as the fastest way of 
processing compensation or pension claims, many being processed in an 
average of 117 days according to VA.
    In May, the VA announced a new partnership with Veterans Service 
Organizations and others known as the ``community of practice.'' The 
effort seeks to reduce the compensation claims backlog for veterans by 
increasing the number of FDCs filed by veterans and their advocates. 
Also, veterans who file an original ``fully developed claim'' for 
service-connected disability compensation may now be entitled to up to 
one year of retroactive disability benefits. The retroactive benefits, 
for FDCs submitted between August 6, 2013 and August 5, 2015, are the 
result of a comprehensive legislative package passed by Congress and 
signed into law by President Obama last year.
    It is PVA's belief that the FDC process has proven effective in 
reducing the VBA's claims backlog by increasing production of claims 
decisions and decreasing waiting times. Also, because VA assigns FDCs a 
higher priority than other claims, veterans receive decisions to their 
claim faster than traditional claims. That said, PVA notes a number of 
concerns with the FDC process.
    First, very few complex, multiple-issue claims in PVA's inventory, 
that also involve claims for Special Monthly Compensation, could be 
submitted as FDCs. When compared with other major Veteran Service 
Organizations, PVA's contribution to the FDC process has been 
substantially less. For example, the Veterans of Foreign Wars processed 
16 times more FDCs than PVA; the American Legion processed 27 times 
more; and Disabled American Veterans processed 35 times more FDC 
claims. This variance is due to a combination of factors. PVA clients 
tend to be severely or catastrophically disabled veterans or survivors 
with claims presenting complicated medical questions. Developing these 
claims with higher complexity is often made more difficult by the 
unavailability of, or limited access to, evidence from various sources 
at the time the claim was filed or the need for a medical opinion to 
reconcile ambiguous interpretations of evidence. Since PVA's goal is to 
attain the maximum grant possible for clients with complex claims, as 
opposed to merely getting a decision, the FDC process does not offer 
the most efficient path to a timely, accurate decision in many cases.
    Another key concern relates to the potential erosion of due process 
should a veteran disagree with an FDC decision or desire to add 
evidence later that supports a higher rating. By agreeing to submit an 
FDC, claimants essentially waive their rights to contest the decision 
in exchange for a faster decision. There has been no data provided on 
the number of FDCs that were appealed, and it may take years before the 
Court of Appeals for Veteran Claims reconciles the foreseeable due 
process issues inherent in the FDC process. With much of the discussion 
focusing on the VBA disability claims backlog, very little attention 
has been placed on the appeals process. However, the downstream effects 
of the backlog fall to the jurisdiction of the Board of Veterans 
Appeals where nearly 43,000 appeals now await adjudication. Many 
veterans who endured the wait associated with backlogged claims face a 
new waiting game - which lasts 251 days on average - once denied FDCs 
become appeals. The current remand rate now sits at 46 percent, which 
means nearly half of appeals are returned to VBA due to errors or 
incompleteness that must be corrected before the Board can issue a 
substantive decision. This could be especially problematic for FDCs 
that are appealed due to the unresolved due process issues that will 
inevitably ensue. Remanded appeals will spend the initial average of 
251 days in the process plus the time it takes to fulfill a remand 
order. This can take months or even years in some cases. Reducing the 
backlog cannot be accomplished by simply replacing one for another.
    PVA has conducted detailed research into the claims backlog and its 
impact on the lives of veterans with disabilities as well as lessons 
learned from past reports, testimonies, and experiences related to the 
backlog. PVA makes the following recommendations which are drawn 
primarily from the findings of this research.
    First, those most responsible for assembling evidence pursuant to 
submission of a Fully Developed Claim, which is considered the 
preferred method of claims submission by VA, should be given controlled 
access to records in the Defense Personnel Records Information 
Retrieval System (DPRIS). DPRIS is an electronic gateway that allows 
authorized users to access the Services' Official Military Personnel 
File (OMPF) and Joint Services Records Research Center (JSRRC) 
repositories online in a secure and efficient manner. This authorized 
access would eliminate wait times associated with the lack of 
interagency responsiveness and empower claimants to develop their 
claims with the necessary evidence of record from the outset.
    Second, in order to ensure the accuracy of decisions in cases 
presenting complex medical questions, VBA should provide claimants with 
timely access to VA clinicians who can provide medical opinions based 
on applicable regulations and objective review of all available 
evidence. Veterans Health Administration (VHA) Directive 2012-002, 
``Documentation of Medical Evidence for Disability Evaluation 
Purposes,'' provides for the completion of a Disability Benefits 
Questionnaire (DBQ) in support of a disability claim upon request. But 
many treating clinicians still remain disinclined to complete a DBQ, 
leaving veterans with virtually no other avenue except the lengthy 
Compensation & Pension exam process for obtaining an expert 
interpretation of medical evidence. Rather than leave it to the 
prerogative of VA clinicians to assist, VA should direct them to 
cooperate with claimants to the greatest extent they are capable.
    Finally, VBA should be required to provide monthly reports on the 
number of Fully Developed Claims that are appealed by Notice of 
Disagreement and submitted to the Board of Veterans Appeals (BVA) by 
Form 9, ``Appeal to Board of Veterans' Appeals.'' In anticipation of 
due process ambiguities linked to FDCs, VBA and BVA should establish a 
joint working group to explore and develop a process for the timely and 
efficient implementation of clear due process standards as these issues 
are reconciled by the Board.
    Mr. Chairman, PVA looks forward to the elimination of the claims 
backlog by 2015 and support the efforts of VA with the Fully Developed 
Claim process. But we recognize that this will only be possible with 
strong oversight of this committee and a continued aggressive focus by 
VA. Otherwise years from now we will still be discussing the backlog 
while veterans will still be waiting for benefits that they have 
earned.
    Thank you again for the Committee's dedication to our veterans. PVA 
would be pleased to take any questions for the record.
Information Required by Rule XI 2(g)(4) of the House of Representatives
    Pursuant to Rule XI 2(g)(4) of the House of Representatives, the 
following information is provided regarding federal grants and 
contracts.
                            Fiscal Year 2013
    No federal grants or contracts received.
                            Fiscal Year 2012
    No federal grants or contracts received.
                            Fiscal Year 2011
    Court of Appeals for Veterans Claims, administered by the Legal 
Services Corporation--National Veterans Legal Services Program--
$262,787.

                                 
             VETERANS OF FOREIGN WARS OF THE UNITED STATES

    MR. CHAIRMAN AND MEMBERS OF THE SUBCOMMITTEE:

    On behalf of the men and women of the Veterans of Foreign Wars of 
the United States (VFW) and our Auxiliaries, I would like to thank you 
for the opportunity to provide testimony for the record regarding fully 
developed claims.
    The Fully Developed Claim (FDC) program is simply the formalization 
of a local VA regional office practice which has existed for decades. 
Historically, many of VA's Veteran Service Center Managers (formerly 
Adjudication Officers) agreed to quickly work fully developed claims 
submitted by veteran service organizations (VSOs). This program was 
regularized by the Veterans Benefits Administration (VBA) in 2009 and 
rolled out to all VA regional offices in 2010.
    Since 2010, VBA has refined the FDC program and increasingly 
encouraged veterans and VSOs to submit claims which do not require 
development of non-governmental evidence. The VA Under Secretary for 
Benefits, Allison Hickey, expressed a goal that 20 percent of all 
claims submitted to VBA should be fully developed. Data obtained from 
VBA shows that FDCs from all sources totaled 21 percent of all claims 
submitted in the month of July 2013.
    While we could claim ``mission accomplished'' by meeting the FDC 
goal, that does little to describe both the benefits and problems 
associated with the FDC program as it is currently implemented. In our 
testimony we will discuss those issues, as well as our impressions of 
Section 506 of PL 112-154 which allows VA to award retroactive benefits 
of up to one year in certain qualifying FDC cases.
Fully Developed Claims Program - What it is
    The FDC program shifts the burden of much of the evidence necessary 
to adjudicate a claim from VA to veterans and other claimants. 
Essentially, in exchange for a promise to process a claim more quickly, 
VA requires claimants to locate, obtain and submit all non-government 
held records necessary to their claim at the time they submit an 
application to VA.
    Those who successfully complete this task, and who take no action 
that disrupts VA in processing their claims, are rewarded with a 
decision often within 90-120 days of submission, rather than the more 
common eight to twelve months VA takes to work non-FDCs.
    This is a clear win for VA. In exchange for promising to work a 
claim to completion more quickly, VA is relieved of the need to develop 
a claim. This reduces the number of employees (FTE) necessary to 
perform this work which allows VA to assign them to perform other 
tasks. In addition, because the bulk of the development is done by the 
claimant and not VA, traditional measures of claims processing 
timeliness (average days pending, average days to complete) are 
reduced. This allows VA to assert that it is processing claims more 
quickly.
    Further, claimants may themselves believe that they have a win 
since they receive a decision from VA more quickly than do their peers 
who submitted claims through the non-FDC process. One would think that 
this is a win-win for both VA and veterans; but is it?
    The claims adjudication process follows certain basic steps: claims 
submission, review, development, decision, and notification. In the FDC 
program, claims submission, review, decision, and notification are the 
same as before. What has changed is that much of the development occurs 
before the claim is submitted to VA, not after. Development must still 
be done, except in the FDC program, it is done on the veteran's clock, 
not VA's. If the veteran is focused, knowledgeable and efficient, or 
has sought the assistance of a trained VSO representative, he or she 
can accomplish the development much more quickly than can VA. However, 
if he or she lacks full understanding of what is necessary to 
successfully complete his or her claim, he or she may take longer to 
complete the application package. Regardless, development time, whether 
performed by the veteran or by VA, should be included when considering 
whether veterans are indeed winners.
    We believe that for many veterans, the total time to gather 
evidence, submit a claim to VA and receive a decision is little 
different under the FDC program than under the non-FDC model. In 
addition to the time factor involved in veteran development, there are 
also some hidden costs inherent in the pre-filing development 
undertaken by veterans. For example, many private health care providers 
are reluctant to provide records directly to the claimant or charge 
significant fees which must be paid, while those same records may be 
provided to the VA upon official request without cost. As part of the 
FDC program the VA encourages that the veteran submit a completed 
Disability Benefit Questionnaire (DBQ); however, many VA treatment 
providers are reluctant to assist the veteran in this regard. Worse 
still, we have many reports of VA health care providers refusing to 
complete DBQs despite VA directives to do so. Finally, private health 
care providers find DBQ instructions to be confusing.
    The FDC program is obviously a success for VA, because timeliness 
numbers appear improved over traditional claims processing. For most 
veterans, however, we suggest that this process, from beginning to end, 
is more a draw than a win. Further, we should not be pitting one 
veteran against another for VA resources. There are other problems 
inherent with the FDC program which limits its usefulness and 
effectiveness:

      If a claim is already pending before VA, the submission 
of a claim under the FDC program is barred.
      An FDC will not be accepted if an appeal on another issue 
is pending if the claims folder is not located at the home Regional 
Office (RO), such as if the pending appeal has been brokered out to 
another RO or if the appeal has already been sent to the Board of 
Veterans Appeals.
      VBA Fast Letters make it clear that submission of any 
additional evidence, no matter how inconsequential to the claim, 
results in the subsequent exclusion of the claim from the program.
      Submission of an appeal on a previously decided issue 
will kick a claim out of the FDC program.
      Although VA is responsible for developing necessary 
records held by the federal government, such as active duty service 
medical records, VA will not accept an FDC where development of 
National Guard and Reserve medical records are required. Keep in mind 
that during the wars in Iraq and Afghanistan, approximately half of all 
those deployed were activated Guard and Reserve personnel. While 
service treatment records created for Guard and Reserve members during 
a period of deployment are technically federal records, the physical 
location of those records becomes the issue and is outside of the 
veteran's control.

    There are unintended consequences of the FDC program. Principle 
among them is that many veterans believe that they should submit only 
one issue with a fully developed claim. The theory here is that each 
additional issue claimed substantially increases the likelihood that a 
VA employee will decide additional development is needed, thereby 
kicking the entire claim out of the FDC program. Further, veterans 
often limit the single FDC issue to what they view as an ``easy claim'' 
or a ``sure thing'' in the hope that a quick decision will lead to 
monetary benefits. This strategy may prove successful in the short 
term, but at a cost. Claims filed later have later effective dates. 
This means that some veterans lose months of benefits in exchange for a 
quicker decision by VA.
    The VFW supports the FDC program. Throughout this Fiscal Year the 
percentage of FDC claims submitted by the VFW has steadily increased. 
In July 2013, 21.8 percent of all claims submitted were accepted by VA 
as fully developed.
Section 506 of Public Law 112-154
    Section 506 states, in pertinent part:

    (2)(A) Effective dates. The effective date of an award of 
disability compensation to a veteran who submits an application 
therefor that sets forth an original claim that is fully-developed (as 
determined by the Secretary) as of the date of submittal shall be fixed 
in accordance with the facts found, but shall not be earlier than the 
date that is one year before the date of receipt of the application.

    (B) Definition. For purposes of this paragraph, an original claim 
is an initial claim filed by a veteran for disability compensation.

    In our view, this law, while well intentioned, will have minimal 
impact on claims processing by VBA. Further, few veterans will benefit 
from this liberalizing statute. There are several reasons for this 
conclusion:

    1. It only applies to original claims. According to VA, original 
claims make up 40 percent of its workload. As of August 31, 2013, VA 
had 240,000 original claims pending. \1\ Section 506 would not apply to 
the vast bulk of pending disability claims.
---------------------------------------------------------------------------
    \1\ Monday Morning Workload Report; August 31, 2013; http://
www.vba.va.gov/reports/mmwr/

    2. Qualifying as an FDC will be difficult. The data shows that 23 
percent of original claims have eight or more issues; most of the 
remaining claims have more than one issue. As discussed above, the more 
issues submitted with a claim the more difficult it will be to submit a 
---------------------------------------------------------------------------
fully developed claim.

    3. While encouraging veterans to file for compensation for 
conditions they believe are related to service is the right thing to 
do, the possibility of receiving an additional year of benefits will 
encourage veterans who have previously not submitted a claim to file 
one. As a consequence, this provision solicits more claims when VA is 
struggling to dig out of its current backlog problem.

    4. While veterans are encouraged to submit fully developed claims, 
because of the number of issues claimed and the increased difficulty in 
submitting an FDC with each additional issue, we anticipate that many 
claims will not qualify for the FDC program, resulting in increased 
customer dissatisfaction when they do not qualify.

    5. For the same reasons, a decision that a claim is not FDC 
eligible and, hence, not eligible for up to one year of retroactive 
benefits, will result in increased appeals.

    6. Further, even if a claim does qualify for FDC processing, there 
is no guarantee that VA will award retroactive benefits because the 
award is based on ``facts found'' and is not automatic. Again, failure 
to award retroactive benefits will result in increased customer 
dissatisfaction and increased appeals.

    The VFW fully supports the FDC program as amended by Section 506. 
We have invested hundreds of man-hours in training VFW service officers 
in preparing and submitting fully developed claims which meet the 
requirements of the program. We believe that this program can be a win-
win for both veterans and VA. However, it is important to recognize the 
limitations of this program, and the implications it may have on some 
veteran's claims.
    This concludes my testimony. Thank you for the opportunity to 
submit the VFW's views for the record.
 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.

                                 
                        Questions For The Record

                 AMVETS RESPONSES TO HEARING QUESTIONS

    Question 1 (line 1062): What additional steps do the VA and other 
stakeholders need to take in order to make the program fully 
successful. We can't fix every one of them. What is the big one we can 
tackle?

    Question 2 (line1188): You mentioned that there is a real need for 
the VA to make changes with regards to dependents and dependent's 
claims and the information for dependents. Do you have any specific 
suggestions to how we can address some of the challenges that 
dependents face when they file claims?

    Response to Questions 1 & 2: The most beneficial thing VA could do 
to ensure the success of the FDC program and eliminate the dependents 
allowance backlog, as well as the claims backlog, is to continue making 
progress on the development and implementation of the Data to Date 
(D2D) Program as part of VBMS, including DBQs and calculators.
    From a VSO perspective, D2D could have a huge impact for both VA 
and its VSO partners. D2D is an electronic interface that would permit 
the VSOs and other external stakeholders to submit complete, fully 
developed claims packages electronically. This program is meant to be 
an electronic portal, similar to that used by the IRS, which would 
allow electronic communication between the VA and all external 
partners.
    Unfortunately, the D2D program has not been fast tracked by the VA 
and has experienced repeated management turnover during the last 12 
months, which has prevented timely and consistent progress. There was 
even a 4-month period where there was no one to talk to in the D2D 
`project office', which forced us to get a contact name directly from 
VACO.
    AMVETS believes that this has occurred since the VA's solution 
appears to be that their external stakeholders will submit claims 
electronically via e-Benefits or VA's SEP and then have to turn around 
and reenter all of the data again into the VSOs' claims management 
database systems. Unfortunately again, this is typical of VA to develop 
a position/solution that excludes their external ``partners'' from the 
planning process; however, when fielded it creates a lot of gratuitous 
work for the VSO ``partners.'' Too many times VA's ``policy'' of 
openness and transparency most closely resembles a one-way street for 
the flow of information.
    Our service director attended a meeting 8 or so years ago when the 
Under Secretary for Benefits said words to the effect that there are a 
lot of VSO personnel in the ROs and you need to put them to work for 
you (the VA). VA seems to have wholeheartedly embraced this idea.
    In response to VA's plans, let me say that the VSOs are not 
employed by the VA as VA's clerk typists. Months ago VA boasted of a 
plan to reduce the number of clerk typists that would allow them to 
``harvest'' the spaces and shift the resources to other more productive 
areas. As expected when we first heard this, the plan has been to get 
the VSOs to do the VA's data entry for them. Anyone who disagrees with 
VA on this is labeled as not wanting to help veterans. Saying this is 
equivalent to Samuel Johnson's quote that ``patriotism is the last 
refuge of a scoundrel.'' Both are done with the intent of shaming the 
target being castigated to do what the attacker wants. In this case it 
is the VA's work which they cannot keep up with.
    The bottom line is that VA needs to automate the entire process 
with human oversight for the checks and balances. Human hands-on 
processing that requires multiple looks and re-looks before the 
original claim is finally completed is as ineffective as demonstrated 
by the multiple backlogs and causes unnecessary angst for the veterans 
awaiting a decision concerning the benefits they were promised.
    Automation can and will transform the VA permitting it to be the 
caring, responsive and healing agency they now strive to be following 
Presidents Lincoln's words during his second inauguration speech, ``to 
care for him who shall have borne the battle and for his widow and his 
orphan...''
    Thank you for allowing us the opportunity to clarify our previous 
testimony.

                                 
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