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



 
              ADJUDICATING VA'S MOST COMPLEX DISABILITY 
                          CLAIMS: ENSURING

                QUALITY, ACCURACY AND CONSISTENCY ON 
                         COMPLICATED ISSUES

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


                                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 December 4, 2013

                               __________

                           Serial No. 113-47

                               __________

       Printed for the use of the Committee on Veterans' Affairs


         Available via the World Wide Web: http://www.fdsys.gov
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                     COMMITTEE ON VETERANS' AFFAIRS

                         JEFF MILLER, Chairman

DOUG LAMOBORN, Colorado              MICHAEL H. MICHAUD, Maine, Ranking 
GUS M. BILIRAKIS, Florida,           Member
DAVID P. ROE, Tennessee              CORRINE BROWN, Florida
JEFF DENHAM, California              MARK TAKANO, California
BILL FLORES, Texas                   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

                       Jon Towers, Staff Director

                                 ______

       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

                              ----------                              
                                                                   Page

                            December 4, 2013

Adjudicating VA'S Most Complex Disability Claims: Ensuring 
  Quality, Accuracy And Consistency On Complicated Issues             1

                           OPENING STATEMENT

Hon. Jon Runyan, Chairman                                             1
    Prepared Statement...........................................     5
Hon. Dina Titus, Ranking Minority Member                              3
    Prepared Statement...........................................     7

                               WITNESSES

YN1 Lauren Price, USN (Ret.) Public Affairs Representative 
  Veteran Warriors
    Oral Statement...............................................     8
    Prepared Statement...........................................    10

Accompanied by:
    MMCS James Price, USN (Ret.) Senior Logistics Chief Veteran 
      Warrantors
Ms. Bettye McNutt, Surviving Spouse
    Oral Statement...............................................    14
    Prepared Statement...........................................    16

    Accompanied by:..............................................
    Glenn R. Bergmann, Esquire, Bergmann & Moore, LLC
Mr. Sherman Gillums, Associate Executive Director for Veterans 
  Benefits Paralyzed Veterans of America
    Oral Statement...............................................    26
    Prepared Statement...........................................    29
Ronald Abrams, Esquire, Joint Executive Director National 
  Veterans Legal Services Program
    Oral Statement...............................................    32
    Prepared Statement...........................................    34

Mr. Zach Hearn, Deputy Director for Claims, The American Legion
    Oral Statement...............................................    41
    Prepared Statement...........................................    43

Mr. Tom Murphy, Director Compensation Service Veterans Benefits 
  Administration, U.S. Department of Veterans Affairs
    Oral Statement...............................................    53
    Prepared Statement...........................................    55

Accompanied by:
    Ms. Edna MacDonald, Director of the Nashville Regional Office 
      Veterans Benefits Administration, U.S. Department of 
      Veterans Affairs

Ms. Sondra F. McCauley, Deputy Assistant Inspector General for 
  Audits and Evaluations Office of Inspector General, U.S. 
  Department of Veterans Affairs
    Oral Statement...............................................    62
    Prepared Statement...........................................    63

Accompanied by:
    Mr. Brent Arronte, Director of San Diego Benefits Inspections 
      Division Office of Inspector General, U.S. Department of 
      Veterans Affairs

                                APPENDIX

Statement by Jeffrey C. Hall, Disabled American Veterans.........    81
Statement by Patricia Driscoll, The Armed Forces Foundation......    87
Tragedy Assistance Program for Survivors.........................    88
Statement by Ms. Sulin Schafer, Spouse of Veteran Errick Schafer.    92
Veterans and Military Families for Progress......................    93
                                                                     00


  ADJUDICATING VA'S MOST COMPLEX DISABILITY CLAIMS: ENSURING QUALITY, 
             ACCURACY AND CONSISTENCY ON COMPLICATED ISSUES

                              ----------                              


                      Wednesday, December 4, 2013

                   House of Representatives
Subcommittee on Disability Assistance and Memorial 
                                            Affairs
                             Committee on Veterans' Affairs
                                                   Washington, D.C.
    The subcommittee met, pursuant to notice, at 3:04 p.m., in 
Room 334, Cannon House Office Building, Hon. Jon Runyan
    [chairman of the subcommittee] presiding.

            OPENING STATEMENT OF CHAIRMAN JON RUNYAN

    Present:Representatives Runyan, Lamborn, Bilirakis, Titus, 
O'Rourke, and Negrete-McLeod.
    Also Present: Representatives Miller, and Michaud.
    Mr. Runyan. Good afternoon, everybody, and welcome. This 
oversight committee of the Subcommittee on Disability 
Assistance and Memorial Affairs will now come to order.
    Throughout the past year, Members of the subcommittee as 
well as the full committee have heard from VA representatives 
on various initiatives that have been instituted in order to 
fulfill the secretary's goal on disability benefits claims for 
2015.
    VBA implemented national initiatives within its regional 
offices including challenge training, quality review teams, 
skill certification testing, and simplified notification letter 
and fully developed claims.
    VBA also rolled out new technologies in the form of the 
Veterans Benefits Management System and several other 
electronic projects, as well as new processing models featuring 
segmented lanes and cross-functional teams.
    All along VBA indicated that significant support and 
training from VBA central office would be critical in this 
rollout.
    On top of these challenges, in April of 2013, VA announced 
that all cases pending in excess of one year would be completed 
by the conclusion of fiscal year 2013.
    Based on this new push, VA instituted many months of 
mandatory overtime for its employees. While there are general 
concerns on whether VA employees were able to issue decisions 
of high quality within the expedited time frame, there are also 
concerns that many of these oldest claims, in fact, were highly 
complex.
    Regional office employees have previously reported that 
claims processors would pass over difficult cases and would 
routinely decide to call easy claims first in order to meet the 
production goals and maximize workload and workload credit 
parameters.
    Thus, it would stand to reason that many of these two-year-
old and one-year-old claims decided in the past quarter 
constitute a challenging workload.
    And today we will hear about a focused issue which ties 
into the VA's various initiatives and which highlights the 
clear necessity of uniform central office support and thorough 
employee training.
    Today's focus is upon the complex claims that are routed to 
the special ops lanes at the regional office to include large 
multi-issue claims as well as traumatic brain injury, 
posttraumatic stress, military sexual trauma, and claims 
involving special monthly compensation just to name a few.
    While VA reported in November of this year that complex 
claims which take an excessive time to require special handling 
or only constitute ten percent of VA's workload, these claims 
require highly competent, educated, and experienced attention.
    Importantly, decisions rendered in these complex claims 
often have tremendous effect on the lives of these veterans.
    Within VA's strategic plan refresh for fiscal year 2011 
through fiscal year 2015, the Department of Veterans Affairs 
noted no fewer than 30 times that VA's strategic plan is 
results driven, and I quote, ``We will be measured by our 
accomplishments and not our promises.''
    So today we want to hear accomplishments, what is going on 
in this high stakes, highly specialized claims processing 
environment, how has employee training focused upon the 
development of these issues, and what is working and what is 
not working.
    Also, we want to hear about the focused investigations of 
the VA's Office of Inspector General who look at specific 
complicated claims on an annual basis within the regional 
office, reviews of VA OIG reports, as well as the recent 
veterans' testimonials are alarming.
    In the past four years, at least 19 regional offices have 
been inspected by the OIG on a second instance. Of those, more 
than half saw a decrease in the claims processing accuracy with 
respect to traumatic brain injuries. This means that the 
reports indicate that VA's OIG's second visit to the ten 
regional offices evidenced more errors than the initial visit 
did.
    With respect to temporary 100 percent disabled claims, 
while improvements have been made on half of the offices, 
inspectors still could not process 50 percent of these claims 
correctly on their second inspection. There is still no other 
word for this but unacceptable.
    At this time, I would like to welcome our witnesses. We 
will have three panels here today. Currently seated are the 
participants of panel one. They include Ms. Lauren Price, 
United States Navy retired, accompanied by Mr. James Price, who 
is also United States Navy retired, who are here on behalf of 
Veteran Warriors.
    To Mr. Price's left sits surviving spouse, Ms. Bettye 
McNutt, accompanied by Mr. Glenn Bergmann, partner at Bergmann 
Moore, LLC.
    After the conclusion of panel one, we will hear from Mr. 
Sherman Gillums, the associate director for the Veterans 
Benefits with Paralyzed Veterans of America; Mr. Ronald Abrams, 
joint executive director for the National Veterans Legal 
Service Program; and Mr. Zach Hearn, deputy director for Claims 
with The American Legion.
    Finally, the third panel, we will hear from Mr. Tom Murphy, 
director of Compensation Services with the Veterans Benefits 
Administration, accompanied by Ms. Edna MacDonald, director of 
the National Regional Office.
    The third panel will also host Ms. Sondra McCauley, deputy 
assistant inspector general for Audits and Evaluations with 
Office of the Inspector General, U.S. Department of Veterans 
Affairs, who will be accompanied by Mr. Brett Arronte, director 
of San Diego Benefits Inspections Division.
    Additionally, the hearing record will include written 
statements from Disabled American Veterans, the Tragedy 
Assistance Program for Survivors, and Ms. Sulin Schafer, wife 
of air force veteran, Errick Schafer.
    With those instructions complete, I thank you all for being 
here today.
    I now yield to the ranking member for her opening 
statement.

  OPENING STATEMENT OF THE HON. DINA TITUS, Ranking Minority 
                             Member

    Ms. Titus. Well, thank you, Mr. Chairman, and thank you for 
holding this important hearing.
    I would also like to thank the witnesses you mentioned who 
are here today for their time and trouble to come and share 
information with us.
    First, I want to applaud the VA for reducing the benefits 
backlog by 34 percent since March of 2013. We hope that the VA 
can maintain this momentum and we are optimistic. We want to 
end this decades long backlog and we are moving in that 
direction.
    Our numbers indeed show that the VA is on track to reach 
the secretary's goal by 2015, so I would ask you to relay a 
message to the people who work for the VA and tell them thank 
you for their efforts and to please keep up the good work.
    As the VBA continues to work through this transformation, 
it is very important that we are working together towards 
solutions that will improve the processes of providing benefits 
to veterans, benefits that they have earned, and we want them 
to be provided in the most timely and efficient manner 
possible.
    So we need to be forward looking so we can address the next 
issues rather than just the problems from the past. We want to 
be able to anticipate what is coming down the road so we do not 
create any new backlog issues.
    Earlier this year, our subcommittee worked on a package of 
bills that are forward-looking and I believe would help the VA 
provide better services to our veterans. The House has passed 
many of these measures. They were bipartisan measures, and I 
hope that the Senate will soon take them up and send them on to 
the President for his signature.
    One of the bills specifically was my bill, Pay As You Rate, 
which I think is appropriate to today's topic as we look at 
complex cases that have more than one issue involved with them. 
This bill would require the VA to pay veterans as each of their 
individual medical conditions is completed.
    Such an approach would result in veterans throughout 
southern Nevada--my district--and the country in receiving 
their payments in a more timely manner rather than waiting 
until the entire case is adjudicated which can be very complex. 
As we will hear, they can get pieces done as they go along.
    Additionally, it seems that such an approach would offer 
the VA better workload management options where some of the 
best VA regional offices could specialize on those medical 
conditions which have proven to be more challenging and more 
complex such as military sexual trauma and traumatic brain 
injury.
    My colleague, Ranking Member Michaud, has introduced a bill 
that would provide veterans with better decisions in a timely 
manner by doing just that and look forward to seeing that move 
forward.
    I am proud to say that we seem to be making progress that 
is reducing the backlog, but there is still some clunkiness in 
the operations and in the effectiveness or lack of 
effectiveness.
    For example, I am concerned that the VA may be 
oversimplifying some of the more complicated and complex 
medical conditions. The VA has essentially broken down the 
coding system with nearly a thousand different medical 
conditions and endless variables into just three lanes, easy, 
medium, and hard.
    That seems a pretty simplified way of looking at all of 
these different variables. And when you define complexity as 
just the number of medical conditions in a claim, I am not sure 
that is an adequate way of looking at it.
    It is important to note that the number of conditions does 
not necessarily dictate the complexity of the entire claim. 
This method of evaluating complexity made sense in a paper 
processing world. But as we look forward now to best practices, 
I believe complexities should be measured not just by the 
number of conditions but rather by the complexity of evaluating 
and paying for the medical conditions that are under 
consideration.
    It is important that the VA look within the current system 
across all 56 VA regional offices to determine what are best 
practices for assigning that complicated work. I believe that 
the VBA can work with VBMS to broker work from one station to 
another to ensure that the best employees are working on the 
most challenging cases.
    This subcommittee--and I thank the chairman for his work on 
this and for his cooperativeness with our side of the aisle--
and the VA share a common goal and that is ensuring that our 
veterans receive the best benefits in a timely fashion.
    So I think we can continue to work together as a committee 
with the VA to develop these tools and best practices. And I 
look forward to hearing your testimony and seeing what options 
may be available to us as we move forward.
    With that, I yield back. Thank you, Mr. Chairman.
    Mr. Runyan. Thank you, Ms. Titus.

      PREPARED STATEMENT OF THE HON. JON RUNYAN, Chairman

    ``Adjudicating VA's Most Complex Disability Claims: 
Ensuring Quality, Accuracy and
    Consistency on Complicated Issues.''
    December 4, 2013
    Good afternoon and welcome everyone. This oversight hearing 
of the Subcommittee on Disability Assistance and Memorial 
Affairs will now come to order.
    Throughout the past year, the Members of this Subcommittee, 
as well as the Full Committee, have heard from VA 
representatives on various initiatives that have been 
instituted in order to fulfill the Secretary's goal on 
disability benefits claims for 2015.
    VBA implemented national initiatives within its regional 
offices, to including Challenge Training, Quality Review Teams, 
Skills Certification Testing, Simplified Notification Letter, 
and Fully Developed Claims.
    VBA also rolled out new technologies in the form of the 
Veteran Benefits Management System and several other electronic 
projects, as well as a new processing model featuring segmented 
lanes and cross-functional teams. All along, VBA indicated that 
significant support and training from VBA central office would 
be critical in this rollout.
    On top of these changes, in April of 2013, VA announced 
that all cases pending in excess of one year would be completed 
by the conclusion of Fiscal Year 2013.
    Based upon this new push, VA instituted many months of 
mandatory overtime for its employees.
    While there are general concerns on whether VBA employees 
were able to issue decisions of high-quality within the 
expedited time-frame, there are also concerns that many of 
these ``oldest-claims'' were, in fact, highly complex.
    Regional Office employees have previously reported that 
claims processors would pass over difficult cases, and would 
routinely decide so called ``easy'' claims first in order to 
meet production goals and maximize workload credit parameters. 
Thus, it would stand to reason that many of these two-year old 
and one-year old claims, decided in the past quarter, 
constituted a challenging workload.
    And today we will hear about a focused issue, which ties 
into the VA's various initiatives, and which highlights the 
clear necessity of uniform Central Office support and thorough 
employee training . . . today's focus is upon the complex 
claims that are routed to the special-ops lanes at the Regional 
Offices, to include large multi-issue claims, as well as 
traumatic brain injury, post-traumatic stress, military sexual 
trauma, and claims involving special monthly compensation, just 
to name a few.
    While VA reported in November of this year that complex 
claims, which take extensive time or require special handling, 
only constitute 10% of VA's workload, these claims require 
highly competent, educated, and experienced attention. 
Importantly, decisions rendered in complex claims often have a 
tremendous effect upon the lives of these veterans.
    Within VA's ``Strategic Plan Refresh'' for Fiscal Year 2011 
through Fiscal Year 2105, the Department of Veterans Affairs 
noted no fewer than THIRTY times that VA's strategic plan is 
``results driven,'' and I quote, ``We will be measured by our 
accomplishments, not by our promises.''
    So today, we want to hear accomplishments----what is going 
on in this high-stakes, highly specialized, claims processing 
environment? How has employee training focused upon the 
development of these issues? What is working? What is not 
working?
    Also, we want to hear about the focused investigations of 
the VA Office of Inspector General, who look at specific 
complicated claims on an annual basis within the Regional 
Offices. Reviews of VA OIG reports, as well as recent veteran 
testimonials, are alarming.
    In the past four years, at least nineteen Regional Offices 
have been inspected by OIG on a second instance. Of those, more 
than half saw a decrease in claim processing accuracy with 
respect to Traumatic Brain Injuries . . . This means that the 
reports indicate that VA OIG's second visit to ten Regional 
Offices evidenced more errors than the initial visit.
    With respect to temporary one-hundred percent disability 
claims, while improvements were made, half of the offices 
inspected still could not process 50% of these claims correctly 
on their second inspection. There is no other word for this, 
but simply ``unacceptable.''
    At this time, I would like to welcome our witnesses. We 
will have three panels today.
    Currently seated include the participants in Panel One. 
They include Mrs. Lauren Price, United States Navy, Retired, 
accompanied by Mr. James Price, also United States Navy, 
Retired, who are here on behalf of ``Veteran Warriors.''
    To Mr. Price's left sits surviving spouse Ms. Bettye 
McNutt, accompanied by Mr. Glenn R. Bergmann, Partner at 
Bergmann & Moore, LLC.
    After the conclusion of Panel One, we will hear from Mr. 
Sherman Gillums, Associate Executive Director for Veterans 
Benefits with Paralyzed Veterans of America; Mr. Ronald Abrams, 
Joint Executive Director for the National Veterans Legal 
Services Program, and Mr. Zach Hearn Deputy Director for Claims 
with The American Legion.
    Finally, in the third Panel we will hear from Mr. Tom 
Murphy, Director, Compensation Service, with the Veterans 
Benefits Administration, accompanied by Ms. Edna MacDonald, 
Director of the Nashville Regional Office.
    The third Panel will also host Ms. Sondra F. McCauley, 
Deputy Assistant Inspector General for Audits and Evaluations 
with the Office of Inspector General, U.S. Department of 
Veterans Affairs, who will be accompanied by Mr. Brent Arronte, 
Director of San Diego Benefits Inspections Division.
    Additionally, the hearing record will include written 
statements from Disabled American Veterans, the Tragedy 
Assistance Program for Survivors, the Armed Forces Foundation, 
and Ms. Sulin Schafer, wife of Air Force veteran Errick 
Schafer.
    With those introductions complete, I thank you all for 
being with us today and I now yield to our Ranking Member for 
her opening statement.

   PREPARED STATEMENT OF DINA TITUS, Ranking Minority Member

    Thank you, Mr. Chairman, for holding a hearing on this very 
important topic. I also want to thank the witnesses for their 
attendance this morning.
    First, I would like to applaud the VA for reducing the 
benefits backlog by 34 percent since March 2013. We hope that 
the VA can maintain their momentum and end the decades old 
backlog. Our numbers show that you are on pace to indeed reach 
the Secretary's goal by 2015. I ask you to relay this message 
to the workforce - keep up the good work.
    As VBA continues to work through its transformation, it is 
important that we are working towards solutions that will 
improve the processes of providing veterans the benefits they 
have earned, in the most timely and efficient manner possible. 
We should be forward thinking to address the next issues, not 
just the problems from the past.
    Earlier this year our subcommittee worked on a package of 
bills that are forward looking and would help the VA provide 
better services to veterans. The House has passed many of these 
measures, and I hope the Senate will soon send them to the 
President for his signature.
    Specifically, my bill, the Pay As You Rate Act, would 
require the VA to pay veterans as each of their individual 
medical conditions is completed. Such an approach would result 
in veterans throughout Southern Nevada receiving payments in a 
timelier manner for their simple medical conditions.
    Additionally, it seems that such an approach would offer 
the VA better workload management options where some of the 
best VA Regional Offices could specialize on those medical 
conditions that have proven to be more challenging such as 
Military Sexual Trauma and Traumatic Brain Injury. My 
colleague, Ranking Member Michaud, introduced a bill that would 
provide veterans with better decisions in a timelier manner by 
doing just this.
    While I am proud to say we finally seem to have a system 
that is reducing the backlog, it is still clunky in its 
operational effectiveness.
    I am concerned that the VA may be oversimplifying some of 
the more complicated medical conditions. The VA has essentially 
broken down a coding system with nearly a thousand medical 
conditions and endless variables into three lanes--easy, 
medium, and hard. Complexity is usually defined at the VA as 
the number of medical conditions in a claim.
    It is important to note however, that the number of 
conditions does not necessary dictate the complexity of the 
entire claim. This method of evaluating complexity made sense 
in the paper processing world. As we look for best practices, I 
believe complexity should not be measured by the number of 
medical conditions in a claim but rather it should be measured 
by the complexity of evaluating and paying for specific medical 
conditions.
    It is important that the VA look within the current system, 
across the 56 VA Regional Offices to identify best practices 
for assigning complicated work. With VBMS, the VBA can 
instantly broker work from one station to another to ensure the 
best employees are working on the most challenging cases.
    Our Subcommittee and the VA share a common goal - ensuring 
that veterans receive the benefits they have received in a 
timely fashion. I hope we can work together to find the best 
ways to utilize VBMS and other tools to meet this goal.
    Today's hearing will explore these options, and I hope the 
VA will continue to work with us to implement many of our 
bipartisan ideas.
    I yield back.
    And with that, I ask unanimous consent that Chairman Miller 
and Ranking Member Michaud be able to participate in our 
hearing today. So hearing no objection, so ordered.
    At this time, I would welcome our first panel to the table. 
Your complete and written statements will be entered into the 
hearing record.
    Mr. and Mrs. Price, thank you for your service and for 
being here this afternoon.
    Ms. Price, you are now recognized for five minutes for your 
oral testimony.

                 ORAL STATEMENT OF LAUREN PRICE

    Ms. Price. Thank you, Chairman.
    Chairman Runyan, Ranking Member Titus, members of the 
panel, Veteran Warriors asked me to express their gratitude for 
inviting ourselves as delegates to represent their views on the 
VA's handling of complex claims and the challenges that are 
faced with those.
    Most of this panel has no idea who Veteran Warriors is. It 
is exactly what it sounds like. We are just a bunch of 
veterans, but we are specialists that come from a wide variety 
of fields and professions and bring in some cases decades of 
experience to the table and to the team. Our purpose is to deal 
with not just complex claims but with all issues relating to 
the VA's functions.
    In particular, I am a combat vet. I served in the navy for 
seven years before I was medically retired. I contracted a 
terminal lung disease in Iraq. I also crushed both of my hands, 
parts of my hands and had to have my hands rebuilt.
    I am a hundred percent disabled. I can no longer work and 
my life expectancy now is down probably less than two years. My 
husband is my primary caregiver. I do not need anything from 
the VA any longer.
    My complicated claim took four years to adjudicate. Not 
once in that four years did I ever present one single piece of 
new evidence. The entire claim was submitted fully developed in 
its entirety before I was even discharged from the navy.
    I am here not to represent my claim or my issues. My 
husband and I are here to make sure that this panel and that 
everyone that will listen to us will understand that cases like 
my own and unfortunately like Mrs. McNutt's are not isolated.
    I personally have dealt with at this time almost 1,000 
cases just in the last six months of veterans and their spouses 
and children who are dealing with complex claims that are being 
denied over and over and over again or being low-balled and 
zero rated.
    We are not a VSO. We are not a veteran service organization 
by any means. Our sole purpose is to work to try to get 
resolution to the manner in which the VA is conducting 
business.
    However, we are not going to sit here and lie to anybody. 
We are going to make sure that everyone understands that we do 
not agree with giving kudos to the VA. Over the last 12 years, 
the majority of the veterans that have come home and come into 
the system have filed complex claims. This was not a secret to 
the VA. They were well aware of what was coming home.
    You have a demographic of veterans that have spent multiple 
deployments, various hostile environments, come home. They are 
better educated now than they ever have been in history. They 
are also equipped with technology available that at a moment's 
notice, they can get information to virtually any question they 
have regarding their benefits.
    The VA pictures this as a disaster waiting to happen 
because these are the veterans that are filing the complex 
claims.
    On November 7th, Secretary Shinseki took credit for 
reducing the backlog by one-third since March. We caution this 
panel and everyone involved with VA claims to don't take that 
as gospel because there is a big part of the claims processing 
that they are not telling people.
    The most insignificant type of claim is not a medical 
claim. It is called a dependent status change. You get married. 
You have a child. You get divorced. Your child ages out. It is 
one document with one attachment, your marriage certificate, 
your divorce decree, what have you.
    Those go into claims. They are adjudicated right alongside 
someone who has a terminal lung disease or Agent Orange 
illnesses. Unfortunately, those claims, and we have been able 
to prove it to this subcommittee, those are the claims that 
they are closing and calling closed and adjudicated. And, 
unfortunately, that does help their numbers come down.
    We ask that every time that you get a new report on the 
VA's numbers you look at it cautiously. You question the data. 
They are not sending in screen shots of their work product. 
They are creating reports. There is almost no transparency. No 
one in this room can just sit down and go look at all the 
numbers that the VA is working on that are being generated on a 
daily basis.
    Congress has never denied the VA a single penny for doing 
its job. The current budget, over $54 billion is being paid out 
to veterans in direct benefits. The balance of their budget 
that they receive right now is for administration of their 
business, but they are not doing business properly.
    I could sit here for hours and give you statement after 
statement after statement of egregious behavior, wrongful 
denials, or in some cases deliberate malfeasance. All we ask is 
that you continue to press this forward, you consider our 
mission which is to have a full overhaul of the Veterans 
Administration, completely reorganizing the way they are doing 
business, and demanding full and 100 percent accountability and 
repercussions for their actions.
    Thank you again, Mr. Chairman, Ranking Member Titus, 
esteemed panel. We are extremely grateful for the opportunity 
to be here today to testify. We would be honored to take any 
questions from you.

               PREPARED STATEMENT OF LAUREN PRICE

    Chairman Runyan, Ranking Member Titus, and members of this 
Panel, VeteranWarriors expresses their gratitude for the 
opportunity to offer our views on the (Department of Veterans 
Affairs ) - VA's ``Most Complex Disability Claims'' issues.
    The majority of this esteemed panel has never heard of 
VeteranWarriors. Please allow me to introduce you to our group. 
We are a very small group of Veterans and supporters, who have 
decided to be the ``David'' in taking on the ``Goliath'' of the 
Department of Veterans Affairs. Our sole mission is to convince 
every necessary entity that the VA is broken and in need of a 
full overhaul, such as the Internal Revenue Service was 
subjected to in the late 1990's, and assist us in making that 
reform a reality. We are internally funded and ask nothing for 
our efforts. However, our efforts to see the VA reformed will 
continue to press forward, until it is a reality.
    Our team has spent five (5) years reviewing every audit, 
investigation, Congressional testimony and media report, 
regarding the actions of the VA. We have taken thousands of 
statements from veterans and their families regarding 
everything from egregious delays or outright denials of 
rightfully earned benefits in claims processing to malpractice 
within the VA Health system. The culminations of that research 
lead us to create completely new working models of the major 
sectors of the VA. For obvious reasons, the concentration 
initially was on Veterans Benefits Administration side.
    We were invited here to today to provide our opinion on 
what could be the best method to assure that the VA processes 
complex claims, in a timely, accurately and in a consistent 
manner across the nation. To be brutally honest with this 
panel, there is currently no process that is in place, which 
will comply with those parameters.
    To illustrate the dysfunction within the category of 
complicated claims, we provide an analogy;
    You have a five year old desktop computer. It has a 
monitor, keyboard, mouse and a hard drive. For the last year, 
your computer will only come on about 50% of the time. You 
monitor works as does the keyboard and mouse - just the hard 
drive won't boot up. You have had the ``Geek Squad'' look at, 
you have taken it apart, you have sent it to the manufacturer; 
every single person has told you that it is broken beyond 
repair and to buy a new computer. Instead of buying a new one, 
you buy a new monitor, you buy a new keyboard then you buy a 
new mouse. But your computer STILL only comes on 50% of the 
time.
    When is Congress going to buy a new computer? When are we 
going to force an overhaul of the VA?
    This analogy illustrates what is happening between Congress 
and the VA. For over thirty (30) years, the Government 
Accountability Office (GAO), the VA - Office of Inspector 
General (VA-OIG), the American Federation of Government 
Employees (AFGE) as well as countless Veterans Service 
Organizations (VSO) and veterans have testified, complained, 
reported to the media and asked for Congressional intervention 
regarding the absolute abysmal dysfunction that is the manner 
of doing business for the VA.
    To be clear, the term ``dysfunction'' is defined by Encarta 
Dictionary (and VeteranWarriors regarding the VA), to be, ``An 
irregularity in the functioning of any part or system, (and) a 
characteristic of dysfunction of petty officialdom''.
    Every veteran in this nation owes gratitude to the Veterans 
Service Organizations (VSO), for their ongoing efforts to 
assist with their claims and right the wrongs regarding VA 
decisions. As well as their continued presence here on Capitol 
Hill, representing them, in what the VSO's believe to be the 
best interests of the veterans.
    However, VeteranWarriors is not officially a VSO. We never 
intend to be one. We will always do everything in our power to 
help a veteran or a family who reaches out to us. Our goal is 
not to placate or appease anyone, be it Congress, the officials 
of the VA or a VSO. We offer no apologies for our views on the 
actions of the VA. In other words, we are not here to lie to 
Congress and tell you everything is looking up and the VA is 
getting better at doing their ONLY mission. Unlike the VSO's 
who have testified before us, we offer no kudos to any sector 
of the VA. In fact, we are here to tell you the plain truth - 
that the VA is irrevocably broken and the only way that all of 
the issues which Congress has repeatedly attempted to address, 
will be fixed, is by a forced overhaul based on VeteranWarriors 
new models.
    To address the purpose of this hearing, VeteranWarriors has 
reviewed current staffing, equipment, and financial resources 
that the VA is allocating to claims processing. The VA provides 
no specific information as to the resources dedicated to 
handling complex claims. We could find no official definition 
of complex claims or any numerical breakout regarding the 
handling of these claims. What we have found is that everyone 
from Undersecretary Hickey to the VSO's has placed the blame 
for a large part of the backlog on the complex claims. Our lay 
understanding of a ``complex claim is a claim which has more 
than 2 or 3 issues claimed by the veteran.
    For clarity, the lion's shares of veterans coming into the 
system over the last 12 years have ``complex'' claims. When you 
have a demographic of veterans whose last decade has been spent 
with multiple deployments to various hostile environments, 
better educated veterans who know what their rights are and an 
age of technology whereby the veteran can readily obtain 
information, you have a recipe for what the VA considers to be 
disaster.
    The VA maintains that it is making headway in reducing the 
backlog of claims in its inventory. As recently as November 7, 
2013, Secretary Shinseki took credit for reducing the backlog 
by over one-third since March 2013. What is being kept quiet, 
what is the dirty secret is that a disproportionate number of 
the complex claims are still awaiting adjudication or have been 
``closed'' awarding the veteran a nominal rating on one or more 
of the minor issues. The primary issues the veterans are 
claiming are being either ``ZERO rated'' or denied outright. 
The claims which the VA suggests are closed are the ``simple'' 
claims, ones with one or two issues. What the VA also does not 
share is how certain claims are classified thus significantly 
affecting the VA's reported numbers, to the VA's benefit.
    This panel must understand an important delineator when 
reading reports of the VA's successes. The VA considers ANY 
type of claim that they have adjudicated and replied to the 
veteran as ``CLOSED''. The important fact to remember is that 
75% of the claims that are making their way to the Board of 
Veterans Affairs Appeals court are remanded for correction. 
These claims are only a small portion of the totality of claims 
decided by the VA. Too many veterans give up and refuse to keep 
fighting. So when the VA tells you they ``closed a claim'', it 
is imperative that the one be highly suspicious of the source 
of the data for the statement.
    One type of ``claim'' that the VA has used to reduce the 
backlog is ``Dependent Status Update'' claims. Getting married, 
got divorced, had a child, child ages out but then goes to 
college - these are all factors that are adjudicated under the 
``CLAIMS'' category. Of course it would be really easy to 
profess success if you just got these claims adjudicated. The 
VA did this with one of our group - After a year of sitting 
without action, the VA finally adjudicated his claim for 
getting married. It took almost exactly one year after he filed 
the ``FULLY DEVELOPED CLAIM'' to add a dependent.
    Meanwhile, a veteran whose ``complex'' claim - filed while 
still on active duty and in compliance under the ``Pre-
Discharge'' (formerly known as the Benefits Delivery at 
Discharge program), took four (4) years to adjudicate. That 
particular program was instituted jointly by the VA and the 
Department of Defense (DoD) to `` . . . minimize the waiting 
time for veterans to receive benefits and services . . . '' 
because the VA professes when filed before the member leaves 
active duty, the claimed issues are considered automatically 
``service-connected''. The veteran was forced to file four (4) 
Notice of Disagreements, a Formal Appeal (which the VA re-
characterized as a Notice of Disagreement) and a second Appeal, 
which resulted in a Decision Review hearing. At which time, the 
officer awarded the veteran all the claimed issues retroactive 
to the end of active duty. However, the veteran still has not 
received Special Monthly Compensation even though all the 
claimed issues had transpired while serving as a convoy driver 
in Iraq for a year.
    Another Iraq combat veteran, has been denied for all 
``automatically service- connected issues'', from day one. He 
filed his claim upon discharge from the military in 2009 and to 
date, has been denied for every issue claimed, in spite of 
mountains of medical evidence which include the VA's own 
records. He is now being forced to file a Formal Appeal in the 
hope of every seeing any of his earned benefits.
    We could spend the rest of this panel's time on the Hill 
this year, extrapolating on the thousands of cases which have 
come to our attention. We will not waste your valuable time by 
doing so.
    The issue of ``complex claims'' is the new reality for the 
VA. However, the VA refuses to adjust fire and accept it, 
manage it correctly, adjudicate them correctly and efficiently 
or even entertain the idea that their way of doing business 
with their sole customer does not work. From the Secretary down 
to the lowliest janitor, no one is being held accountable, no 
one is accepting responsibility, no one is forcing the rank and 
file to abide by the laws, rules and policies that exist in 
managing these complex claims. Instead, the VA finds ways to 
manipulate the numbers, sugar-coat the malfeasance and explain 
away the $100 billion dollars per year it spends on 
administration of its business.
    Congress has never denied the VA any money for doing their 
job. But like a spoiled child, even getting what they want for 
every ``pilot program'', new ``initiative'', increased manpower 
or bright and shiny new technology, they still want more 
without giving up anything. The VA does not have any 
``transparency'' whatsoever. The veteran is forbidden from 
speaking with claims adjusters. The VA does not provide 
``screen shots'' of their work product. Rather, they employ 
people whose sole purpose is to create reports that make the VA 
look good to Congress and the media.
    VeteranWarriors has developed a viciously more efficient, 
streamlined model of processing these ``complex'' claims, 
utilizing the resources the VA already has on board. No new 
money, resources, manpower or laws are needed to make proper 
adjudication of all claims, especially the complex ones, a 
reality.
    OUR proposed reality is one which provides for every 
veteran of every era, most especially those with complex 
claims. It is the right of every veterans claim to receive 
efficient, accurate and professionally managed benefits and 
services. This reality needs the support of every Congressional 
leader across the aisle today. So are we going to continue to 
ignore every expert that tells us the computer is broken and 
continue to throw good money after bad, or are we ready to buy 
a new computer . . . Are you ready to overhaul the VA?
    Thank you again Mr. Chairman, Ranking Member Titus and 
esteemed panel. We are truly grateful for the opportunity to 
present our opinions to you today. VeteranWarriors is humbled 
by the Congressional commitment and dedication to our veterans. 
VeteranWarriors would be honored to answer any questions by the 
panel for the record.

    Executive Summary
    The mission of VeteranWarriors is to be the catalyst which 
forces the necessary changes to the manner in which the 
Department of Veterans Affairs does business with its only 
customers...the United States Veteran.
    The VeteranWarriors testimony today, with regard to the 
manner by which the Department of Veterans Affairs manages 
complex claim, will introduce our position to Congressional 
leaders and provide clarity regarding Veterans Affairs 
practices and disciplines which are in our opinion, 
contradictory to the mission statement and very purpose of the 
Department of Veterans Affairs.
    VeteranWarriors' primary areas of concern and 
recommendations remain static;
    * That complex claims are the standard rather than the 
exception and the VA has steadfastly refused to accept that 
these are the standard types of claims that veterans will 
submit now and continuing into the future.
    * That complex claims are being pushed to the ``back 
burner'' in favor of ``simple claims'' in an effort to appease 
Congressional mandates, media pressure and veterans concerns.
    * That the VA Regional processing offices are foregoing 
handling complex claims in an effort to meet statistical 
requirements set out by the Secretary of the VA, as well as 
entice employees by creating a method to receive financial 
remuneration for the volume of claims ``Closed'', rather than 
focusing on accuracy and timeliness.
    * That Congressional leaders discontinue hearings, audits 
and investigations into the multiple issues of malfeasance, 
incompetence and dereliction of duty regarding the VA's 
handling of claims, in particular complex claims that have been 
going on for decades.
    * For Congress to discontinue accepting the officials from 
the Department of Veterans Affairs manipulated data as factual, 
in the face of incontrovertible evidence to the contrary, 
especially without sworn testimony by the VA officials.
    * The recommendations to the panel include a complete 
overhaul of the Department of Veterans Affairs, specifically 
utilizing VeteranWarriors efficiency model.
    * Having identified the multiple methods by which the VA 
manipulates data presented, VeteranWarriors suggests that 
Congress has no other clear and present duty but to demand a 
full overhaul of the Department of Veterans Affairs.
    Mr. Runyan. Thank you, Ms. Price.
    And now we will hear from Ms. McNutt. Please begin your 
statement when you are ready.

                ORAL STATEMENT OF BETTYE MCNUTT

    Ms. McNutt. Thank you, Mr. Chairman, for holding today's 
hearing on----
    Mr. Runyan. Do you have the microphone on?
    Ms. McNutt. --complex VA claims. My name is Bettye McNutt. 
I am the widow of Ronald Adrian McNutt, Vietnam War veteran. 
Accompanying me today is my attorney, Mr. Bergmann, of Bergmann 
& Moore.
    The Subcommittee on Disability Assistance and Memorial 
Affairs invited me here today to discuss what has become my 
most complex and now 23-year-old claim for VA dependency and 
indemnity compensation.
    I am here for two reasons. First, I am here seeking justice 
for myself and for my family. I ask VA to correctly and 
promptly apply the law and grant my claim. Second, I am seeking 
justice for other widows and orphans of our Vietnam War 
veterans.
    In the audience today is my son who lost his father and his 
best friend when he was 12. Also in attendance today is my 
niece, Sandra Peterson, who is the daughter of a Vietnam War 
veteran who also died from Agent Orange poisoning.
    Mr. Chairman, I filed my claim in 1990. This same claim 
remains pending. I have waited 8,600 days of VA delays and 
denials. VA erroneously denied my claim seven times. For nearly 
12 years, my claim sat idle at VA because VA did not respond to 
my notice of disagreement.
    The Court of Appeals for Veterans Claims returned my claim 
to VA three times based on errors, errors conceded by the VA. I 
know that VA is waiting for me to die. Without immediate 
attention, my claim is destined to sit idle for several more 
years as I wait, hope, and pray for a resolution.
    My late husband, Ronnie, was born in Memphis, Tennessee on 
December the 31st, 1947. As a 19-year-old college student, he 
was drafted into the U.S. Army. Ronnie was deployed to the 
Vietnam War in 1968 and 1969.
    On September the 22nd, 1987 at the early age of 39, he died 
from an aggressive form of cancer leaving me a widow with a 
young son. His death came quickly from a cancer that invaded 
many parts of his body very rapidly. Ronnie died within five 
months.
    I brought a picture today of my Ronnie because this hearing 
today is honestly about my Ronnie. He died because of the 
Vietnam War and his service to his country.
    On his death bed, he told me about how he swam in rivers 
highly contaminated with Agent Orange. Ronnie told me stories 
about using discarded Agent Orange barrels for barbecue pits.
    First, VA has not contested that my husband served on the 
ground in Vietnam. Second, the law presumes veterans on the 
ground in Vietnam were exposed to Agent Orange. And, third, a 
medical expert provided the VA with two nexus medical opinions 
concluding that Ronnie's cancer was as likely as not due to his 
exposure to Agent Orange in Vietnam.
    VA's Jackson, Mississippi regional office made many, many 
mistakes. First, on more than one occasion, the VA applied the 
wrong legal standards to decide my claim. Second, VA ignored 
favorable medical evidence to my claim. And, third, the VA 
sought evidence to deny my claim.
    A lot was taken away from me 26 years ago and I have done 
the best that I knew how as a widow to provide for my son, 
Brandon. The impact of my husband's death on my son was 
tremendous. Words cannot tell you. I have had emotional, 
physical, and financial distress. For me, I have suffered 
unimaginable grief from Ronnie's death. For 8,600 days, words 
cannot express my suffering.
    Going without my VA benefits has meant coming home 
different occasions to a very cold and dark house because my 
utilities were turned off. It has meant receiving food and 
clothing from strangers as I sometimes came up short. It has 
meant begging for mercy as a repo man stands in my driveway at 
two o'clock in the morning to take my car.
    In conclusion, the VA's mistakes and their delays involve 
more than just me. It is not about just Bettye McNutt. There 
are many Bettye NcNutts out there.
    Congress passed a law mandating that VA expeditiously 
process appeals like mine. However, VA routinely ignores this 
law. Now is the time for Congress to put teeth into that law so 
other widows like myself can get accurate and prompt decisions 
on their VA claims.
    Mr. Chairman, no one should have to go through that for 
8,600 days. Thank you for listening to me.

              PREPARED STATEMENT OF BETTYE MCNUTT

    Statement for the Record
    Bettye B. McNutt
    Surviving Spouse of Vietnam War Veteran Ronald A. McNutt
    Before the Subcommittee on Disability Assistance and 
Memorial Affairs
    Committee on Veterans' Affairs
    U. S. House of Representatives
    Regarding
    ``Adjudicating VA's Most Complex Disability Claims:
    Ensuring Quality, Accuracy and Consistency on Complicated 
Issues''
    December 4, 2013
    Introduction
    Thank you Chairman Jon Runyan and Ranking Member Dina Titus 
for holding today's hearing about ``Adjudicating VA's Most 
Complex Disability Claims: Ensuring Quality, Accuracy and 
Consistency on Complicated Issues.''
    My name is Bettye B. McNutt, and I am the widow of Vietnam 
War Veteran Ronald A. McNutt. Accompanying me is my attorney 
handling my claim, Glenn R. Bergmann, a partner of Bergmann & 
Moore based in Bethesda, Maryland.
    I am honored to be here to testify before the Committee on 
Veterans' Affairs. The Subcommittee on Disability and Memorial 
Affairs invited me here today to discuss what has become a 
complex and now 23-year old claim for Dependency and Indemnity 
Compensation (DIC).
    DIC is a benefit provided by the U.S. Department of 
Veterans Affairs (VA) for surviving family members when a 
Veteran dies of a service-connected medical condition.
    I am here for two reasons. First, I am here seeking justice 
for myself and my family. I ask VA to correctly and promptly 
apply the law and grant my claim. I have waited eight thousand 
six hundred days too long. Without immediate intervention, my 
claim is destined to remain open for several more years as I 
wait, hoping and praying for VA to properly decide my claim. 
Because of VA's frequent mistakes, I have been forced to live 
in poverty sometimes without heat and electricity as a widow 
raising a son orphaned by the Vietnam War.
    Second, I am here seeking justice for the other widows and 
orphans of our Vietnam War veterans, as I am well aware that 
there are many like me. In the audience today is my son, 
Brandon, and my niece, Sandra Peterson. She is the daughter of 
a Vietnam War veteran who also died from Agent Orange 
poisoning. Widows and their families should not be subjected to 
decades of delay. Sadly when faced with a denial most people 
give up. I think VA knows this. VA must quickly grant the 
worthy claims of other widows and orphans. VA must follow the 
law.
    The unnecessary waiting must end now, for me and for the 
many hundreds of other widows and orphans coping with the loss 
of a loved one due to cancers associated with exposure to Agent 
Orange during the Vietnam War.
    Ronald A. McNutt, 1947 - 1987
    My late husband Ronnie was born in Memphis, Tennessee on 
December 31, 1947. As a 19-year old college student, he was 
drafted into the U.S. Army as an infantryman. Ronnie served 
honorably between November 16, 1967, and June 19, 1969. Ronnie 
deployed to the Vietnam War from April 30, 1968, to June 16, 
1969. On September 22, 1987, at the early age of 39, he died 
from an aggressive form of cancer, leaving me a widow with a 
young son. His death came quickly from a cancer that invaded 
many parts of his body. Ronnie died within five months of his 
first diagnosis of cancer.
    I brought two pictures of my Ronnie with me today because 
this hearing is about my husband. He died because of the 
Vietnam War and his service to our country. On his death bed, 
just weeks before he died, he told me about how he swam in 
waters highly contaminated with Agent Orange. He told stories 
about using discarded Agent Orange barrels as makeshift 
barbeques. There is no doubt in my mind and in my doctor's 
professional opinion that the dioxin poison in Agent Orange 
killed my Ronnie.
    I am here because our nation makes a solemn commitment to 
the families of our Veterans. At the west end of the Washington 
Mall, inside the Lincoln Memorial, are these important words:
    With malice toward none, with charity for all, with 
firmness in the right as God gives us to see the right, let us 
strive on to finish the work we are in, to bind up the nation's 
wounds, to care for him who shall have borne the battle and for 
his widow and his orphan, to do all which may achieve and 
cherish a just and lasting peace among ourselves and with all 
nations.
    One phrase from President Abraham Lincoln is memorialized 
on a plaque on the front of the VA central office one block 
from the White House here in Washington, DC:
    ... to care for him who shall have borne the battle and for 
his widow and his orphan.
    Request to VA
    I am here today seeking justice in my husband's name, as VA 
appears to have forgotten the second part of the phrase, ``for 
his widow and his orphan.'' VA is not doing the job the 
American people expect and our Veterans' families deserve.
    This claim has become complex despite the fact that I have 
satisfied all the legal requirements for DIC benefits. First, 
VA has not contested that my husband deployed to the Vietnam 
War, as shown by his discharge papers. Second, the law presumes 
Veterans deployed to the Vietnam War were exposed to Agent 
Orange. And, third, a medical expert provided VA with a 
``nexus'' medical opinion concluding Ronnie's cancer was ``as 
likely as not'' due to exposure to Agent Orange during his 
deployment to Vietnam.
    Complex Claim
    I originally filed my claim with the Jackson, Mississippi 
VA Regional Office on May 19, 1990. My DIC claim is difficult 
because it deals with Agent Orange on a direct basis. At one 
point, VA deferred (although probably lost) my claim for nearly 
12 years, from 1994 to 2006, apparently waiting on new research 
about the harmful effects of Agent Orange. I believe VA lost or 
simply forgot to process my claim until I reminded the agency 
about it in 2006.
    However, VA needlessly made my claim far more complex. VA 
gave contradictory reasons for denial; applied the wrong legal 
standard; ignored evidence favorable to my claim; and sought 
evidence to deny my claim.
    In summary, during my 23 year battle to obtain VA benefits, 
VA improperly denied my claim seven times. Despite the fact 
that my DIC claim was returned by the Court of Appeals for 
Veterans Claims (Court) three times based on VA errors, VA 
still refuses to follow the law and science and grant my claim.
    My letters to the President and Congress are simply 
referred back to VA without action by VA. I feel that VA is 
waiting for me to die.
    VA Errors
    My 23 years fighting for justice is complicated and 
lengthy. I provided the Subcommittee with a detailed chronology 
which appears at the end of my statement.
    In summary, VA has made six significant mistakes on my 
claim. As a result, my claim now sits once again at the Board 
of Veterans' Appeals (Board) awaiting adjudication yet again 
here in Washington, DC. Here are the most salient facts 
regarding VA's chronic errors.
    1.VA's first error: VA did not issue a Statement of the 
Case. On May 19, 1990, I filed my claim at the Jackson, 
Mississippi regional office. On December 10, 1990, VA 
improperly denied my claim. On February 7, 1991, I filed a 
timely Notice of Disagreement (NOD) to begin the appeal 
process. On November 16, 1994, VA issued a second rating 
decision. However, VA never issued a Statement of the Case in 
response to my original NOD, thus leaving my claim open and 
unadjudicated.
    2.VA's second error: In response to a letter I wrote to VA 
on February 17, 2006, VA incorrectly considered my letter as a 
request to reopen my claim, even though my claim remained open 
and unadjudicated since 1990. Despite this, on June 3, 2006, VA 
denied my claim on the grounds I did not provide new and 
material evidence.
    3.VA's third error: On June 3, 2006, VA approved a death 
pension, even though I didn't apply for it. I returned the 
check they sent me because it was incorrect.
    4.VA's fourth error: On August 4, 2009, the Board 
incorrectly denied my claim because it found that Ronnie's 
cancer was not on the list of presumptive diseases associated 
with Agent Orange exposure.
    5.VA's fifth error: On March 4, 2011, despite the existence 
of a favorable medical opinion by Dr. Carey that found a causal 
link between my husband's death and exposure to Agent Orange in 
Vietnam, the Board again denied the claim because my husband's 
cancer was not the type of cancer on the list of presumptive 
diseases associated with Agent Orange exposure.
    6.VA's sixth error: In a March 2012 letter to the Chief of 
Staff at the VA Medical Center in West Virginia, the Board 
declared the private medical opinion which it had previously 
stated it had ``no reason to doubt'' was contradictory and 
ordered its own independent medical expert opinion. Relying on 
an outdated Institute of Medicine (IOM) study, the ensuing VA 
opinion found that there was a less than 50% probability that 
my husband's cancer was the result of in-service herbicide 
exposure.
    7. VA's seventh error: In September 2012, the Board denied 
my claim again finding the VA medical opinion more probative 
than the private medical opinion, despite a follow-up medical 
opinion refuting the VA examiner's findings and a written brief 
submission by my attorneys on August 6, 2012.
    I am upset at VA's behavior because VA appears to be 
opposing me at every turn. VA can easily grant my claim right 
now if they reviewed the evidence of record and correctly 
applied the law. This is not a difficult claim, but VA has made 
it complex. VA denied my claim for 23 unbearable years based on 
conflicting reasons. If VA follows the law and stops their 
seeming effort to undermine my claim, it will be granted as I 
have satisfied all the requirements DIC.
    Hardship
    As noted above, I commenced this claim some 23 years ago. 
VA has provided inconsistent reasons for denying my claim which 
continues to cause me enormous frustration and hardship.
    The impact on my son Brandon was tremendous. He lost his 
father at the age of 12. Ronnie's death upended Brandon's young 
life. He started failing in school, suffered from nightmares, 
and severe nervousness which resulted in ridicule by teachers 
and students because of the change in his behavior. His dad did 
not see him graduate from high school, attend his prom, or be 
there to mentor him as a good father.
    For me, I've suffered unimaginable emotional grief from 
Ronnie's death. I've done the best I can as a widow to provide 
for my son. Despite the fact that I worked, my son and I 
experienced severe economic hardship. We simply learned to do 
without for a very long time. There were times when we did not 
have enough food. We learned to rely on friends and even 
strangers to provide simple groceries. I would sometimes come 
home in the dark to a house that had no heat or electricity 
because I could not afford to pay the bills.
    It sickens my heart that VA simply does not follow the law 
or science. My claim should have been granted decades ago.
    8,600 Days
    In conclusion, I seek justice for my husband Ronald who 
died from cancer due to Agent Orange poisoning. I ask VA to 
grant my DIC claim. I have waited eight thousand six hundred 
days too long.
    For the other widows and orphans of Vietnam War veterans 
who died due to Agent Orange, I ask VA to improve training so 
that VA employees follow the law, consider favorable evidence, 
and stop trying to find reasons to deny claims.
    This is not just about me. In 2003, Congress passed a law 
mandating that VA expeditiously process appeals like mine. 
However, VA routinely ignores this law. Today, VA's 
``expeditious'' treatment equates to at least four more years 
of additional delay.
    I wish Congress would put teeth into that law so the 
thousands of other widows and Veterans get accurate and prompt 
decisions on their VA appeals.
    Thank you again for this opportunity to appear here today. 
I will gladly answer your questions.
    Mr. Runyan. Thank you for your testimony.
    And both, Ms. McNutt and Ms. Price, thank you for being 
here and putting your personal view to all of us.
    We will start with a round of questions. I know the clocks 
are not up, but we will be able to see it from this end. So to 
get moving in a timely manner, the first question is for Ms. 
McNutt.
    Talking about this process and moving it forward with--you 
are accompanied by your attorney, Mr. Bergmann, here. Could you 
tell us about when you decided to engage in counsel and how 
that has helped you to get to where we are today in this 
process because like you just kind of alluded to, there are 
many, many other people out there in the same situation?
    Ms. McNutt. Well, as I said, I was introduced to Agent 
Orange on his death bed. And after his death, that was forever 
in the front of my mind.
    So I proceeded without any help, without any direction. I 
started researching the chemicals in Vietnam. I read an article 
in a newspaper and it was talking about Agent Orange. And I 
filed a claim in 1990.
    Most of these were just, as I said, stumbling in the dark 
grasping. But as I went along, the more I learned and the more 
I felt it was something that I had to do because my husband 
told me about this on his death bed for a reason which at the 
time I did not understand.
    Mr. Runyan. Can you give a little insight, though, on how 
counsel----
    Ms. McNutt. After 20 years of groping in the darkness and 
dealing with the VA and all their errors, I prayed. I asked for 
help. And one day I received a call from the Vietnam Veterans 
of America and I was told that I might want to seek counsel.
    I went online and I found Mr. Bergmann. And I decided this 
is going to be the person that is going to help me. This is who 
I want to represent me.
    Mr. Runyan. Mr. Bergmann, can you elaborate a little on 
what you have done to expedite the process, if you will?
    Mr. Bergmann. Certainly. Thank you.
    As Mrs. McNutt has indicated, she commenced her claim in 
1990 and her claim sat for over 12 years. When we came on her 
case--as former VA counsel, my job once I left VA's employ--our 
job as attorneys is always to connect the dots, to make sure 
that the evidence that is needed to satisfy the requirements is 
presented to VA.
    VA is supposed to in a non-adversarial posture, 
paternalistic posture, to give notice to veterans and widows 
and they routinely do not do that.
    So what we did in Ms. McNutt's case is we assisted in 
getting the medical evidence which was not difficult. Her 
husband had a very aggressive form of cancer at the age of 39. 
And we put the evidence together with our arguments and 
submitted it to VA. And, you know, we can do all we can to dot 
our Is, cross our Ts, but we cannot make VA properly apply the 
law.
    And we have been up to the U.S. Court of Appeals for 
Veterans Claims three times and each time, a VA attorney will 
trot forward and say, you know, we made a mistake, this case 
needs to go back. That does not help Mrs. McNutt, but we are 
hopeful that--despite 23 years--we are hopeful we are near the 
end.
    Some of the help that we get along the way, obviously the 
Veterans Choice Act of 2006 has been helpful in allowing 
attorneys early access to assisting veterans and widows.
    Mr. Runyan. Thank you.
    And one question for Ms. Price. From all the testimonials 
you have taken from veterans on a national scale, what are the 
most frequent errors you have heard of in the process?
    Ms. Price. Not necessarily in any ranking order, Chairman, 
but most specifically as counsel, Mr. Bergmann, said failure to 
apply the law correctly, complete disregard of medical evidence 
provided, most specifically from civilian providers. That is 
very high on the list.
    And the third one, and this rides to the top pretty 
regularly, is the almost complete and utter disregard for 
anything that is considered a policy, rule, regulation, or law. 
The raters seem completely incapable of rudimentary reading of 
their own policy.
    I have a very specific one in my case. The secretary sent 
down a policy change, an order directly to the regional offices 
with regard to those of us exposed to burn pits in Iraq and 
Afghanistan April 26th of 2010.
    That application of that policy change has, to the best of 
my knowledge, not been addressed once in the almost 5,000 
victims I know personally.
    Mr. Runyan. Thank you.
    And with that, I yield to the ranking member for her 
questions.
    Ms. Titus. Thank you.
    And thank you both for your testimony. You are very 
courageous to come and we appreciate your willingness to share 
your stories. We do not want to see anybody else have to go 
through what you have.
    I understand the general dissatisfaction and the desire to 
make the VA follow the law and to overhaul the way they do 
business, but can you tell us just one, just start with one 
specific thing, and I would ask both Ms. McNutt and Ms. Price, 
one thing that could do through legislation that would make the 
process work better because that is what we have to work with.
    How can we change the law or how can we change the policy 
in a specific way that would improve circumstances?
    Ms. Price.
    Ms. Price. Yes, ma'am. I have a very specific answer for 
you.
    Ms. Titus. Okay.
    Ms. Price. You could create a law that essentially orders 
the secretary to establish a complete set of repercussions and 
an oversight agency that has the ability and the authority to 
dish out those repercussions, that when malfeasance, deliberate 
especially, is shown on the part of a rating official, on the 
part of a case manager, on the part of a healthcare provider, 
that those people can be terminated, that those people can 
suffer the repercussions like any civilian would for doing 
their job poorly or deliberately not doing their job the way it 
is supposed to be done.
    Ms. Titus. And I would ask the attorney if somebody is 
guilty of malfeasance in doing their job, aren't there already 
in place some ways to go after that person? You were a VA 
attorney; is that correct?
    Mr. Bergmann. Are you talking about the VA?
    Ms. Titus. I am talking about in response to what Ms. Price 
just said.
    Mr. Bergmann. I do not deal much with malfeasance issues. 
What I deal with, Ranking Member Titus, is appeals where each 
case that comes down from the court has language citing to the 
law, Title 38, Section 7112 that says this case will be given 
expeditious treatment.
    Now, and I realize I am not being responsive to your 
question----
    Ms. Titus. I can ask the VA for some of that information. I 
appreciate that suggestion.
    Ms. McNutt.
    Ms. McNutt. There has got to be someone somewhere that has 
the total authority in making sure that the training--they say 
there is lack of training, lack of technology. I do not 
understand that. If I acted in those ways, I would have been 
fired.
    But I think stronger force should be put on them to enforce 
the law by putting someone in place or maybe more than one 
person that would oversee that this law is enforced, that it is 
a serious matter and that something has got to change.
    And I am with her. If you cannot perform the job, find 
another job.
    Ms. Titus. Thank you, Mr. Chairman.
    Mr. Runyan. I thank the gentle lady.
    With that, I recognize Mr. Lamborn.
    Mr. Lamborn. Thank you, Mr. Chairman, and thank you for 
having this hearing.
    And thank you all for being here.
    And I want to build on what the ranking member just asked. 
Mr. Bergmann, you have been on both sides now legally with your 
employment previously and what you do now.
    Do you have any advice or guidance you would give this 
committee on how the VA could work its claims process better?
    Mr. Bergmann. I guess the advice I would give, sir, is that 
there be accountability. What I see is a lack of accountability 
at the agency level where we are not supposed to be on opposite 
sides of the aisle.
    VA will not talk to us. If we do get someone on the 
telephone, they will ask us how we got their number. We get 
differing responses each time. We cannot handle many cases at 
the agency level sometimes because we do not know where our 
file is because we get different responses to that.
    So I think if we can hold the folks who are deciding these 
claims accountable, that would help veterans and widows and 
their counsel in expediting the process.
    Mr. Lamborn. Accountability, that is a great thing to bring 
to our attention. Training and incentives, do you have any 
advice in those areas?
    Mr. Bergmann. As Mrs. Price talked about, she indicated her 
concern that it seemed like that some VA ratros decision makers 
but only 20 percent do not follow simple guidelines. Absolutely 
training is key.
    I think the VA's OIG report of last year indicated that, 
and I may be misquoting and I think the OIG is going to provide 
a report later today, but only 20 percent of their ratros 
decision makers are properly trained. That means 80 percent are 
under-trained. These are people who are deciding our veterans' 
disability claims. This is not acceptable.
    Mr. Lamborn. Okay. Thank you.
    Mrs. Price, I want to thank you for your service.
    And, Ms. McNutt, I want to thank you for your husband's 
service.
    Mr. Chairman, I yield back.
    Mr. Runyan. I thank the gentleman.
    With that, I recognize Mr. O'Rourke.
    Mr. *O'Rourke.* Thank you, Mr. Chair. And I would also like 
to thank the chairman for organizing today's hearing in the 
manner in which he has organized it.
    Very often we will hear from representatives from the VA 
and then afterwards perhaps hear from VSOs or others who are 
impacted. I like this order because I am really looking forward 
to hearing the VA's response to the issues that you brought up.
    And the word that we keep hearing over and over again is 
accountability. And to use your word, Ms. Price, repercussions. 
We want to see how that accountability is implemented and what 
the consequences are when someone does not do their job 
properly or when there is the case of malfeasance or someone 
who is working against the interest of the veterans that they 
are supposed to serve, we want to know what the consequences 
are specifically.
    And I think you raised a great point. One hit home with me 
and it sounds like with the rest of the committee.
    And, Ms. McNutt, as I said earlier when I had a chance to 
meet you before the hearing began, I commend you on your 
courage in being here. I hope that your story helps galvanize 
the VA, you know, one, to resolve your claim which has taken 
far too long already, but also to serve as the added inducement 
to ensure that no one else is suffering what you have been 
through and to bring stories like yours to our attention as an 
oversight committee and body and to the attention of the VA.
    So really appreciate your service, Ms. Price, and through 
you, Ms. McNutt, your husband's service and your support of him 
and his legacy and memory and both of you, your reference on 
behalf of other veterans and veterans' families who are 
suffering these same kinds of problems.
    So I really do not have any questions. I will reserve those 
questions for the VA based on the issues that you brought up. I 
just want to let you know that your stories have hit home and I 
really do think they are going to have their intended effect of 
changing the culture and adding additional power to our ability 
to exercise oversight over the VA. So thank you.
    Mr. Chair, I yield back.
    Mr. Runyan. I thank the gentleman.
    And the chair now recognizes Mr. Bilirakis.
    Mr. Bilirakis. Thank you, Mr. Chairman, and I appreciate 
you holding this hearing, a very important hearing.
    And I appreciate the testimony. Mrs. Price, who I know 
pretty well, we worked together over the years on VA issues. 
And, Mrs. McNutt, thank you for your courage and I know you 
will make a difference for others.
    And I really appreciate so very much for both of you 
testifying today.
    Mrs. Price, first of all, thank you for your service as 
well. Thank you for testifying, and I want to ask you a couple 
questions if that is okay.
    You have met with me over the years on particular cases, 
and I really appreciate it, and you worked with my district 
office as well to help our true American heroes, our veterans.
    I have a question with regard to, again, give--can you 
explain, elaborate a little bit on your particular case, the 
experiences that you had over the years? I think that would be 
helpful to the committee as well, if you will.
    Ms. Price. Thank you, Congressman.
    It has actually been my honor and privilege to work with 
you over the last few years, in particular for other veterans' 
issues. I know you are extremely supportive of all of us that 
have come home whether we need VA services or not.
    But to answer your question, when I got home, I was still 
on active duty. I was stationed at SATCOM and I was sick and I 
was injured. And I went through the medical board process and 
it took--by the time we completely finished, it took about 10, 
11 months for me to get through my board process.
    But I stayed on active duty for 18 months total. And my 
first rating from the VA came in and it said you have 30 
percent. There is a rule in place called the DeLuca criteria 
that has been around for decades based on a court case. It has 
to do with every single one of us that has bilateral appendage 
injuries, arms, legs, ears, eyes, anything you got two of.
    Up until the time I had a DRO hearing, I had it appeared to 
be the same case manager. Because I am an English aficionado 
and the method in which the way the person wrote letters to me, 
the verbiage the person used seemed to be the exact same person 
every time.
    The raw rating on my hands is 230 percent and that is a big 
number, but they have a very algebraic method of using 
cumulative math. Both of my hands, I had the bones removed and 
my tendons rerouted so that I could actually even hold this. I 
cannot tie my shoes. I cannot button buttons. I cannot do zip 
lock bags, all kinds of things.
    My last surgery was while I was still on active duty. I 
also contracted this lung disease.
    When I sent all of this information in including some very 
elaborate ratings on my hands, the testing that took five 
hours, the first letter that came back to me was telling me 
that the amputation rule did not apply to me which is a very 
basic rule that the VA has.
    When you hit a certain calculation level, we just said, 
okay, we are done. You know, we are too high up. Now you just 
go over and use the amputation rule and you treat it as loss of 
use or loss of the limb. Said you did not lose your hands, what 
makes you think you get to use the amputation rule.
    I had essentially that same answer all three appeals. My 
lungs they told me I did not, both my lungs and my hands, they 
told me I did not qualify for combat-related or SMC.
    I was a convoy driver. I have over 350 missions. I drove 
Humvees. I drove LNTVs. I even drove an Iraqi city bus in 
downtown Baghdad. And I provided all of that information in my 
case, pictures taken by combat cameras of me driving. They 
still denied me over and over and over again.
    I have PTSD for a variety of reasons up to and including 
being a combat driver. When I filed the claim, they denied me 
right away, immediately. They said you do not have it. Our 
evaluator said that you must have had a bad childhood. No, 
actually, I did not. My childhood was not terrible. It was not 
great. I was a kid. But it had to do with the issues that 
happened over there.
    And I was being treated by their own psychiatrist and their 
own psychologist for a year who said I had PTSD, but yet they 
still denied me. Does that answer your questions, Congressman?
    Mr. Bilirakis. Yes, yes.
    Ms. Price. Thank you very much.
    Mr. Bilirakis. Thank you very much.
    And I know my time has expired. Will we have another round? 
I know you have three. Can I have one more question? Thank you 
very much.
    Ms. Price, the VA stated in its testimony that from 2009 to 
2013, the average number of issues included in a disability 
claim increased from 2.8 to 4.9 and that the VA is issuing 
lanes as an organizational structure to process complex claims. 
They stated that the core lane includes claims with three or 
more medical issues that do not involve special populations of 
veterans. That is a quote there.
    Can you expand upon your thoughts about this aspect of the 
VA's testimony?
    Ms. Price. Specific to core claims?
    Mr. Bilirakis. Specific to the process.
    Ms. Price. Okay.
    Mr. Bilirakis. Yes.
    Ms. Price. Putting things into lanes?
    Mr. Bilirakis. To lanes, correct.
    Ms. Price. Okay.
    Mr. Bilirakis. Correct.
    Ms. Price. Does anybody here drive in traffic? Does anyone 
here ever drive on the Beltway? You have lanes. There are only 
so many and there are express lanes. And in theory, everybody 
uses the express lanes. How many people have seen the news 
stories about the guy riding with the mannequin in a seat to 
get into the express lane?
    Yeah, there are going to be ones that go into those express 
lanes, but our special operations claims, I love that they took 
that title, we have complicated claims. Those complicated 
claims are still being ignored and still being pushed aside 
because the lane that they have has a group, a group of 
adjustors and raters that are dealing with them.
    Instead of them being either brokered out to other regional 
offices that do not have a backlog like Nebraska, Oklahoma, 
they are not brokering them out, they set on them. And then 
they have these core which I do not even get what core is. 
Okay. So you have three. They have they call them the express 
lane for one or two. If you hit three, but it does not hit into 
what seems to be a rather fluid definition of special or 
complex, you end up in the core.
    They are also not giving any information as to what the 
qualifications are of these people that are managing those 
lanes or those raters that are working in those lanes because 
experienced rater does not tell me anything. How many years did 
they have rating medical claims for MetLife before they went to 
the VA?
    Mr. Bilirakis. Thank you.
    I will go ahead and yield back. Thank you, Mr. Chairman.
    Mr. Runyan. The chair recognizes Ms. Negrete-McLeod.
    Ms. Negrete-McLeod. No questions.
    Mr. Runyan. No questions.
    Chairman Miller? Nothing.
    I want to thank you all again for your testimony and being 
here today. You are now excused and we will ask the second 
panel to come forward to the witness table.
    At this time, I welcome panel two which includes Mr. 
Sherman Gillums, the associate executive director for Veterans 
Benefits, Paralyzed Veterans of America; Mr. Ronald Abrams, 
joint executive director of the National Veterans Legal 
Services Program; and Mr. Zach Hearn, deputy director of Claims 
with The American Legion.
    We appreciate all your attendance today. Your complete and 
written statement will be entered into the hearing record.
    Mr. Gillums, you are now recognized for five minutes for 
your testimony.

               ORAL STATEMENT OF SHERMAN GILLUMS

    Mr. Gillums. Thank you, Mr. Chairman.
    Chairman Runyan, Ranking Member Titus, Members of the 
subcommittee, on behalf of Paralyzed Veterans of America, I 
want to thank you for this opportunity to discuss complex 
claims, a topic that is near and dear to veterans like me and 
those we represent at PVA.
    Complex claims by their nature involve those cases that 
require the most experienced eyes and minds to properly 
adjudicate. These can be the oldest claims in the inventory, 
claims with multiple issues or those presenting the most 
complicated circumstances to unravel such as military sexual 
trauma, PTS, and catastrophic disability.
    Since membership in PVA is predicated on catastrophic 
disability, that will be my focus.
    PVA service officers have honed a unique expertise in 
developing and advancing the most complex claims in the system. 
Where special multi compensation or SMC claims are often the 
exception for most accredited representatives, they are fairly 
common for PVA. So we appreciate this long overdue focus on 
complex claims.
    The Veterans Benefits Administration has made tremendous 
strides in reducing the backlog since launching the 21st 
century transformation initiatives. But as we said during our 
June 2012 testimony complex claims remain problematic because 
disability benefits questionnaires, evaluation builders, and 
rules-based calculators too often oversimplify cases that 
require critical thinking and inductive reasoning, not 
algorithms, to adjudicate with true accuracy.
    So any accuracy numbers achieved through the use of these 
processes are qualified by context as it relates to complex 
claims. The problem is defining accuracy of these cases often 
lies in the eye of the beholder. If by accuracy VA means the 
veteran receives maximum entitlement, then accuracy targets 
remain unmet.
    VA contextualizes accuracy to mean if the rator inputs a 
given data set such as the boxes checked on a DBQ or C&P exam 
results and follows the rules-based prompts, the decision will 
be free of error based on this algorithmic construction.
    The problem is disability evaluation builders do not 
encourage the application of judgment-based principles like 
reasonable doubt or guide rating specialists through 
ambiguities in the evidence by reconciling the difference 
between total loss of bladder control versus neurogenic bladder 
sphincter and someone with a spinal cord dysfunction.
    And this is where we have issues with the way complex 
claims are adjudicated under a rules-based system.
    A veteran with a severe disability may receive an accurate 
SMC rating under VA's definition based on limited evidence and 
binary rules but not the most accurate rating possible that 
reflects the true extent of disability or need.
    And I will give you a case in point that deals with the 
terrible condition that PVA sees all too often, ALS or Lou 
Gehrig's disease, a fatal motor neuron disease that does not 
slow down for the painstaking protocols that VA must follow.
    Since the passage of the presumptive rule on ALS open 
entitlement to veterans and survivors, PVA has worked over 
6,200 ALS claims which has made our field staff more familiar 
with these complex cases and extremely staunch in our 
insistence that they are timely and accurately adjudicated.
    So you can imagine my reaction when I heard about a veteran 
in San Diego who received notice that he needed to submit to a 
compensation and pension exam to prove his need for skilled 
care despite presenting competent medical evidence of such need 
from his treating physician.
    The VA has the prerogative to call claimants in for exams 
pursuant to a claim, but this prerogative has become one of 
those intractable rules that we criticize. The problem is this 
veteran was in hospice so he could not submit to an exam.
    The VA rater, an experienced lane coach, was bound by the 
quality-driven rule that C&P exams are mandatory even though he 
had enough evidence to grant this R2 claim and the regulatory 
discretion to do so under Title 38 which states any hospital or 
exam report from a government or private entity may be accepted 
for rating a claim without further examination.
    VHA directive unacceptable clinical evidence also allows VA 
examiners to supplement the review of claims files with a 
telephone interview if necessary with the claimant in order to 
complete a DBQ.
    When neither option was exercised here, the words hospice 
and skilled care noted in the medical records simply triggered 
the requirement to order a C&P exam in the name of quantity. 
Instead of serving as prima facie evidence of imminent death, 
thus substantiating the need for regular skilled care, common 
sense will give way to a calculator which is supposed to be a 
decision support tool, not replacement for one's reasonable 
faculties.
    To make this point, I offered an analogy. Three plus two 
always equals five. And if every disability claim were based on 
metrics like decibel level or percentage of range of motion, a 
high degree of accuracy will be achievable under the current 
system.
    But these complex claims are like adding two irrational 
numbers, pi 3.14, so on and so forth, plus the square root of 
two, to arrive at an outcome that cannot be precisely summed 
with a calculator. In that same vein, these claims call for 
informed, qualitative analysis to find the most accurate albeit 
imprecise answer.
    That answer was never found in the San Diego case as the 
claim ultimately died when the veteran finally succumbed to his 
ALS. This was a missed opportunity to do the right thing. 
Unfortunately, this was not an isolated case. We see VA 
regional office staff across the country pointing to the same 
rules to justify taking unnecessary steps in similar cases.
    And I can point to one in Nashville for Ms. MacDonald who 
is going to follow this panel. She is the regional office 
director who will testify.
    And, of course, in New Jersey, Mr. Chairman, I also have a 
case for you if you are interested.
    We understand the dilemma VA faces under pressure to reduce 
the backlog while achieving timeliness and accuracy targets, 
but every aspect of this problem is not a numbers game.
    In the case of complex claims as we define them, there are 
no shortcuts to doing them right. They require experienced 
minds that are free to apply common sense and pro veteran legal 
principles like reasonable doubt or foregoing C&P exams when 
existing evidence is satisfactory in the qualitative 
deliberation of claims with no black and white answers.
    As I said earlier, accuracy is not about how well VA raters 
adhere to a set of protocols to arrive at an ostensibly logical 
outcome notwithstanding obvious blind spots in the process.
    Accuracy is measured by whether VA has provided the maximum 
benefit possible in these complex claims with imprecise answers 
that do not lend themselves well to binary propositions and 
calculators.
    Thank you, Mr. Chairman, Ranking Member Titus, and Members 
of the committee, and I will be happy to answer any questions 
you have.

             PREPARED STATEMENT OF SHERMAN GILLUMS

    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 
adjudication of VA's most complex disability claims to ensure 
quality, accuracy and consistency on these complicated issues. 
PVA has a unique expertise in dealing with complex claims 
because PVA members have complex disabilities as a result of 
spinal cord injury or dysfunction.
    The Department of Veterans Affairs (VA) has fully deployed 
its new processing model for disability compensation claims, 
called the Veterans Benefits Management System (VBMS), in order 
to reduce the number of backlogged claims. This paperless 
processing model places an emphasis on expediting claims where 
the supporting documentation is fully developed by the Veteran. 
But the success of VBMS greatly depends on the process design, 
like rules-based processes, and supportive technologies like 
Special Monthly Compensation (SMC) calculators, that undergird 
the system. Unfortunately, rules-based systems treat all 
veterans the same and can be flawed by imperfect rulemaking and 
application. This is the challenge for a rules-based computer 
system; it does not have the human interaction to fully 
understand the circumstances of a specific injury. The numerous 
issues faced by veterans with catastrophic injuries create a 
complex set of outcomes that cannot be easily reconciled by 
logic-based systems that cannot appreciate nuance in disability 
assessments. Calculators used in rules-based systems 
historically fail to compute the right ratings for persons with 
multiple issues. This type of decision analysis uses decision 
trees that attempt to enable the rater to simplify and resolve 
complex questions. This technique, however, can be problematic 
when the analysis involves highly qualitative assessments that 
are reduced to binary choices.
    This processing model also handles claims for veterans who 
have unique circumstances, such as financial hardship, 
homelessness, or serious injuries or disabilities in special 
``segmented lanes.'' The problem is the growth in the number of 
claims considered ``complex'' since September 11, 2001. Complex 
claims, according to VA, are characterized by the number of 
issues per claimant filed, which has doubled to 8.5, when 
compared with claims from past wartime eras. Also of 
significance, of the 47,814 complex claims currently in the VA 
inventory, over half are backlogged. In fairness, this number 
has steadily decreased over time. But they still take too long 
to adjudicate in many cases, particularly for our members with 
terminal ALS.
    PVA has developed the unique expertise in dealing with 
complex claims because PVA membership is predicated on having 
one of the most complex disabilities one can have: spinal cord 
dysfunction, whether due to injury or disease. This can occur 
due to trauma, ALS, MS, and other debilitating causes, and 
often manifests in both primary and secondary residual losses 
throughout the bodily systems, including the often under 
regarded ``invisible'' aspects of injury like mental 
impairment, need for attendant care, and helplessness. Complex 
claims in this regard go beyond the mere number of issues.
    Accurately rating these losses for claim purposes requires 
expertise in neurology, physiatrist, urology, psychiatry, and 
other specialty areas. But during Compensation & Pension (C&P) 
examinations, it is common to see a general practitioner 
authoring medical opinions on etiology, nature and extent of 
dysfunction and cumulative effect of separate yet concurrent 
disabilities. This is not a problem when the examiner devotes 
enough time to understanding the disability and its nuances 
before rendering a conclusion. However, this is not always the 
case. As a result, when these opinions result in lower ratings 
than the veteran should have, the ensuing debate takes on a 
subjective hue when the regulations alone do not persuade a 
decision reversal.
    While VBA has instituted an evaluation system that assigns 
greater weight to complex claims, these claims are often too 
esoteric for journeyman raters, full of embedded issues and 
ambiguities both legal and medical that lead to errors. 
Moreover, these issues do not lend themselves exclusively to 
rules-based analysis without inductive, common sense reasoning 
in many cases, such as reasonable doubt provisions, which seems 
to have slowly disappeared from training and guidance for new 
raters. However working these cases requires a combination of 
experience and open-mindedness to do so correctly.
    For example, in one PVA case a veteran with ALS submitted 
evidence supporting a higher rating for Special Monthly 
Compensation at the R-2 rate from his treating physician, thus 
verifying his need for skilled care in his home. Despite 
substantiating his need with credible medical documentation, he 
had to subsequently submit to a C&P exam at the VA's direction 
where the examiner concluded he did not need skilled care on a 
daily basis because he had little movement. Not only did the 
examiner improperly contemplate movement as a basis for 
determining need for care, VA misapplied its own regulation on 
resolving doubt when two expert opinions conflict. When common 
sense is applied, there is little doubt on the question of 
whether a veteran with terminal ALS, an incurable, quickly 
debilitating condition with foreseeable, inevitable 
consequences, needs skilled care. This case out of the San 
Diego VA Regional Office illustrates what happens when a 
profoundly complicated set of disabilities, a lack of 
expertise, subjective interpretation of regulations, and rules 
that do not allow for a ``common sense override'' option 
collide in a veteran's claim. In this instance, the veteran 
presented enough evidence from his VA clinician, yet VA still 
required a VA examination per inflexible VA guidance in such 
cases (see M21-1MR Part IV, Subpart ii, Chapter 2, section H). 
While PVA commends the Veterans Benefits Administration (VBA) 
for implementing such initiatives as the Acceptable Clinical 
Evidence option, which allows a rater to decide based on the 
record in lieu of a C&P exam, this has not taken root system-
wide and needs to be.
    It would also help to eliminate redundancies such as 
unnecessary C&P exams that either corroborate the evidence of 
record or create arbitrary bases for denying a claim. PVA has 
long criticized VA's overuse of C&P examinations particularly 
when the evidence of record already substantiates the claim. 
These exams attempt to provide a snapshot of complex 
disabilities based on cursory review of the medical history and 
templates, called Disability Benefits Questionnaires (DBQs), 
that ask a lot of questions but not always the right ones. For 
example, ``Need for higher level of assistance'' is not asked 
on the ALS DBQ, even though the terminal nature of disease 
makes constant need for specialized care likely in virtually 
every case. And with the addition of rules-based calculators 
that make C&P exams a mandatory step in many instances, these 
incorrect decisions are given the patina of unassailable 
faultlessness. PVA is on record stating that rules-based 
calculators and processing are not conducive to accurate 
analysis where complex claims, as we describe them, are 
concerned. They can be adequate starting points. But these 
claims require experienced raters who, for example, would not 
conclude that a veteran who can barely stand up due to lost 
``useful'' function should be rated the same as a veteran who 
can walk but with difficulty. Or that a veteran with paraplegia 
cannot be considered in need of aid and attendance because he 
manages his neurogenic bowel and bladder and dresses 
independently thus no longer functionally disabled.
    Experienced raters, not algorithms, best factor in the 
nuances of special monthly compensation and areas of subjective 
interpretation that can lead to an incorrect decision. For this 
reason, as we asserted in June 2012 hearing testimony, reducing 
the backlog through the use of technologies cannot come at the 
expense of accurately rating the most complicated claims in the 
inventory. This is why PVA trained its service officers to 
fully develop a claim long before VA idealized the Fully 
Developed Claim concept. Our service officers know what 
questions to pose to an examiner, how to reconcile the medical 
and legal ambiguities, and how to draw a path toward 
entitlement for the rater from the time the claim is filed. But 
not every rater, particularly the new ones, can or feel 
empowered to see past the inflexible rules and seemingly 
indisputable C&P examinations enough to question or deviate 
when necessary.
    Perhaps that is how it has to be in the grand scheme of the 
entire backlog and we understand that rules are critical to 
organizational success. But the exceptions are the rule for 
PVA. A veteran with terminal ALS died in hospice while his 
claim was pending before a ``Special Ops'' lane coach because 
he needed a DBQ despite the fact that the evidence of record 
supported entitlement. A utilitarian system that successfully 
delivers benefits to one million veterans, but overlooks the 
most vulnerable, is inconsistent with moral obligation derived 
from Lincoln's promise to those who served our country. As VA 
celebrates the success in reducing the backlog through the use 
of new technologies and innovative processes, more attention 
now needs to shift toward developing strategies for 
adjudicating complex claims more timely and accurately.
    PVA believes there are several things that can be done to 
improve support to veterans needing SMC:
    * SMC cases should be assigned only to the most experienced 
raters and VA must ensure that new raters are properly trained 
on SMC and its applicable regulatory doctrines.
    * VA needs to allow for the application of a ``common 
sense'' override when rules-based processes limit or preclude 
necessary subjective analysis such as reasonable doubt or the 
weight/credibility of evidence, or fail to reconcile 
ambiguities in the medical evidence or legal applications
    * It is critical that if denial of a complex claim is 
predicated on a C&P exam, particularly in cases of terminal 
illness or catastrophic disability, the reasons and bases must 
detail how the weight of all evidence was assigned, whether 
reasonable doubt applied or not, and whether the acceptable 
clinical evidence option was considered in lieu of ordering a 
C&P exam.
    * VA must expand acceptable clinical evidence (VHA 
Directive 2012-025) for nationwide implementation.
    * And finally, VA must ensure the rules-based process 
allows for and encourages the application of 38 CFR Sec. 3.102, 
which defines ``Reasonable doubt'' doctrine. Accordingly, 
``When, after careful consideration of all procurable and 
assembled data, a reasonable doubt arises regarding service 
origin, the degree of disability, or any other point, such 
doubt will be resolved in favor of the claimant. Reasonable 
doubt means one which exists because of an approximate balance 
of positive and negative evidence which does not satisfactorily 
prove or disprove the claim.'' (Authority: 38 U.S.C. 501(a))
    Historically, due to the nature of our catastrophically 
disabled membership, PVA has been the subject matter expert for 
claims involving multiple injuries or conditions. PVA has 
enjoyed the privilege of providing VA with help in field 
studies and advice on processes that best meet the unique needs 
of veterans with catastrophic injuries. PVA National Service 
Officers have even participated in the training of VA claims 
processors. This valuable service has tremendously benefited 
both organizations and illustrates an important, enduring 
partnership. PVA's success in claims processing has been due to 
diligence in training our service officers and in understanding 
the challenges faced by those with the most complex of cases. 
VA must do the same. Data processing is no substitute for 
education, training and understanding. We fear that as VA 
continues to aggressively look to reduce the backlog, complex 
claims may move further behind. While advances have been made 
in processing theses claims for those most needing, we caution 
the Subcommittee and VA not to become too satisfied with their 
own success to not see those still left behind. PVA looks 
forward to continuing to make VA aware of the need to keep 
complex claims in the forefront and to ensure they are properly 
and quickly adjudicated, particularly as they impact our most 
catastrophically injured veterans.
    This concludes my testimony. I will be happy to answer any 
questions you may have.
    Mr. Runyan. Thank you, Mr. Gillums.
    With that, I will recognize Mr. Abrams for five minutes.

                ORAL STATEMENT OF RONALD ABRAMS

    Mr. Abrams. Thank you.
    I have been involved in veterans' law for over 40 years. 
The VA has faced huge backlogs before and the VA has had to 
deal with reducing the backlog, adjudicating claims faster, and 
in almost every instance, the error rate, especially the error 
rate for complex claims, has gone up. You just simply cannot go 
too fast when you have complicated claims.
    The first thing we have to talk about is what is a complex 
claim. Some claims by their very nature are complicated, 
special monthly compensation, traumatic brain injury. In fact, 
the regulation dealing with TBI is so complicated that some 
people call it the Da Vinci code. Try and look at it sometime 
and you will be impressed.
    Some claims can be complex as they are developed by the VA 
or as evidence from the claimant comes in, ancillary issues 
arise, different theories of service connection come up. They 
can become very difficult.
    And some claims, more than a few and more than I like, can 
become complicated because of VA error. And in those cases 
veterans face a nightmare. Not only do they have to get the 
right evidence before the VA, they have to overcome the unfair 
denial which is an obstacle that stands in their path.
    The worst type of VA errors are the result of premature 
adjudications. Some VA ROs incorrectly adjudicate and 
prematurely deny claims based upon inadequate evidence, 
especially inadequate VA exams. These errors reveal for many 
veterans that the claims process can be adversarial. Based on 
my experience working for the VA for many years, working for 
NVLSP, going on quality checks to over 40 VA regional offices 
for the American Legion, who should be commended for doing that 
work, shows to me that the error rate at the VA has been 
consistently at least 30 percent in the various ROs. Sometimes 
it is higher. It is unrealistic to assume that the VA will ever 
get its real error rate to 98 percent.
    Over 70 percent of the claims appealed to the Board of 
Veterans Appeals are reversed, or remanded. And over 70 percent 
of the claims taken to the Court are sent back because of VA 
error. In fact, NVLSP wins over 90 percent of the claims that 
it takes to the Court.
    In its rush to judgment we have found that many ROs, VAROs, 
prematurely deny or ignore many claims and potential claims. 
Unfair premature denials cause unnecessary appeals and years of 
delay before deserving veterans obtain justly earned benefits. 
And even more important some veterans fall through the cracks. 
Adjudicating many claims quickly does not do much good if many 
of these adjudications are done in a premature manner and many 
deserving veterans are unfairly denied. What will happen is 
veterans will appeal, the backlog will eventually grow, and we 
will be facing this over again.
    I wish to commend the Under Secretary General Hickey for 
her commitment to the fully developed claim program. I think it 
is the best thing that the VA has tried in over 40 years and I 
encourage it.
    We suggest the following: the VA work measurement system, 
which encourages people to prematurely adjudicate claims, has 
to be overhauled even if Congress has to pass a law. The VA 
needs more people to work these claims. In spite of electronic 
this, and lanes, and all the other things the VA is trying to 
do, which is a good thing, they do not have enough people. They 
need more people to work the claims.
    And finally the adjudication culture at the VA needs to be 
changed. Many VA managers that we have met on our travels 
unfortunately act like they are producing widgets rather than 
adjudicating claims filed by real people. You saw the real 
people here today. Their goal should not be prompt 
adjudication. The goal should be a timely, accurate, and fair 
adjudication. Which in the long run, not in the short run, is 
the best way to finally adjudicate claims and reduce the 
backlog. Thank you.

              PREPARED STATEMENT OF RONALD ABRAMS

    Mr. Chairman and Members of the Committee:
    I am pleased to have the opportunity to submit this 
testimony on behalf of the National Veterans Legal Services 
Program (NVLSP). NVLSP is a nonprofit veterans service 
organization founded in 1980 that has been assisting veterans 
and their advocates for over thirty years. We recruit and train 
volunteer attorneys, service officers from such veterans 
service organizations as The American Legion, the Military 
Order of the Purple Heart and the Military Officers Association 
of America in veterans benefits law, and conduct quality 
reviews of VA regional offices on behalf of The American 
Legion. NVLSP also represents veterans and their families on 
claims for veterans benefits before VA, the U.S. Court of 
Appeals for Veterans Claims (CAVC), and other federal courts. 
Since its founding, NVLSP has represented thousands of 
claimants before the Department of Veterans Affairs (VA) and 
the Court of Appeals for Veterans Claims (CAVC). NVLSP is one 
of the four veterans service organizations that comprise the 
Veterans Consortium Pro Bono Program, which recruits trains and 
mentors volunteer lawyers to represent veterans who have 
appealed a Board of Veterans' Appeals decision to the CAVC 
without a representative. NVLSP has written educational 
publications, such as the Veterans Benefits Manual (VBM), that 
thousands of veterans advocates regularly use as practice tools 
to assist them in their representation of VA claimants.

    WHAT ARE COMPLEX DISABILITY CLAIMS
    In general there are three types of complex claims:
    * some claims, by their very nature, are very complicated;
    * some claims can become complex as they are developed by 
VA or as evidence from the claimant is submitted; and
    * some claims can become complex because of VA error.
    Inherently Complicated Claims
    Claims involving entitlement to special monthly 
compensation (SMC) and claims involving the evaluation of 
traumatic brain injury or mental conditions can be very 
complicated. (In fact, the regulation dealing with the 
evaluation of traumatic brain injury (TBI) is so complicated 
that some VA adjudicators call it the ``Da Vinci Code.'' (38 
C.F.R. Sec.  4.124(a), DC 8045).) Other inherently complicated 
claims include, but are not limited to, the evaluation of joint 
conditions (see DeLuca v. Brown 8 Vet. App. 202 (1995); claims 
for service connection for PTSD (includes claims for PTSD based 
on military sexual trauma (MST)); claims for secondary service 
connection; claims for service connection based on presumption 
(see 38 U.S.C. Sec.  1101(3) and 38 C.F.R Sec.  3.309(a) 
(2013); and claims for increase for a service connected back 
disability.
    Claims That Can Become Complicated
    Most claims for service connection have the capacity to 
become very complicated. Let me give you a few examples:
    A. Let us talk about what appears to be a simple claim for 
service connection for an arthritic joint condition (back, 
knee, shoulder, ankle). Many veterans support their claims for 
an arthritic condition by saying that they suffered from pain 
ever since discharge. In many instances there is no objective 
evidence of complaint or treatment of an arthritic problem in 
service. Some VA adjudicators deny such claims. These denials 
are wrong because this action constitutes a premature denial. 
If the duty to assist is triggered (38 U.S.C. Sec.  5103A), the 
VA is obligated to further develop the claim to determine if 
the joint condition manifested to a degree of ten percent 
within one year of discharge (see 38 C.F.R. Sec. Sec.  3.307 
and 3.309(a)). The VA would be obligated to invite the veteran 
to submit lay and medical evidence that would tend to support 
the conclusion that the joint condition manifested to a degree 
of ten percent within the presumptive period and medical 
evidence linking the current disability to the symptoms 
identified within the first year after discharge. While medical 
evidence would be helpful, lay evidence alone can be enough to 
support the finding that a joint condition manifested to a 
compensable degree within the first year after discharge. 
Generally, a medical opinion would be required to link the 
veteran's current joint disability to the symptoms suffered 
within the presumptive period. If service connection was 
granted, the VA would have to establish the proper effective 
date and evaluate the severity of the disability. These issues 
can also be complicated.
    B. Most claims involving entitlement to high levels of 
special monthly compensation (SMC) are inherently very 
complicated. Recently NVLSP worked on a claim for benefits that 
dealt with entitlement to SMC.
    a. The veteran was shot in the head while on a combat 
mission in Iraq. As a result of his injuries, surgeons removed 
part of his brain and skull. In total, he had undergone over 
thirteen surgical procedures and had been a patient at six 
military and civilian medical centers and continued to suffer 
on a daily basis from the devastating effects from his tragic 
injuries.
    b. The VA issued an initial Proposed Rating on March 7, 
2011 (the veteran at that time, was still in service waiting to 
be discharged) which acknowledged eighteen different service-
connected disabilities. These disabilities included residuals 
of traumatic brain injury (100%), a gunshot wound to the face 
(80%), and loss of half of the visual field in each eye (50%). 
The initial rating also awarded special monthly compensation at 
the (l =) level based on the need for aid and attendance (l), 
combined with a separately rated disability greater than fifty 
percent (=). The VA also established entitlement to SMC ratings 
under 38 U.S.C. Sec.  1114(k), for loss of use of the right 
foot, and one for loss of use of a creative organ.
    c. On April 5, 2011, the VA issued a second proposed 
Rating. This rating established entitlement to SMC M. 
Underlying this proposed special monthly compensation rating 
was the veteran's need for aid and attendance (l), combined 
with additional, separately rated disabilities of the same 
etiology rated at 100% or more (next higher rate, to (m)). 
These separately rated disabilities include: gunshot wound to 
the left face, right eye, seizure disorder, scars, adjustment 
disorder, temporomandibular joint disorder, left ear hearing 
loss, tinnitus, loss of smell and taste, and seventh cranial 
nerve dysfunction.
    d. A law firm, assisted by NVLSP, (the law firm represented 
the veteran on a pro bono basis) argued that the evidence of 
record supported a higher level of SMC because he has (a) the 
loss of use of both his right hand and right foot, (b) the need 
for regular aid and attendance due to other independent 
disabilities, and (c) the additional need for a higher level of 
aid and attendance without which he would require residential 
institutional care.
    We argued that for the reasons stated below, the veteran 
was entitled to compensation under 38 U.S.C. Sec.  1114(r)(2).
    e. First, under 38 C.F.R. Sec.  4.71a and Diagnostic Code 
5111, the veteran is entitled a 100% schedular evaluation based 
on loss of use of both a hand and a foot.
    f. Second, he is also entitled to special monthly 
compensation benefits under 38 U.S.C. Sec.  1114(l) due to the 
loss of use of both his right foot and right hand (38 C.F.R. 
Sec.  3.350(b)). (The VA acknowledged the loss of use of the 
right foot.) In addition, as a result of his traumatic brain 
injury he also has functional loss of use in his right hand.
    g. Third, he is also entitled to special monthly 
compensation benefits under 38 U.S.C. Sec.  1114(l), based on 
service-connected disabilities unrelated to his loss of use of 
his right foot and right hand, that cause him to need regular 
aid and attendance. The gunshot wound to his head triggered a 
full range of other disabilities independent of his hand and 
foot, including but not limited to seizures, vertigo, loss of 
vision, loss of hearing, cognitive difficulties, mild loss of 
memory, trouble swallowing, and partial paralysis in the face.
    h. Fourth, because there are two separate, unrelated 
special monthly compensation ratings under subsection (l), the 
veteran is entitled to special monthly compensation benefits 
under Sec.  1114(o). Further, his entitlement to compensation 
under subsection (o) combined with his need for regular aid and 
attendance require that VA grant him, at a minimum, a rating 
under Sec.  1114(r)(1).
    i. Fifth, considering the full range of his service-
connected disabilities that resulted from him being shot in the 
head, he requires an even higher level of care than regular aid 
and attendance under subsection (r)(1). As the record 
indicates, the veteran would require residential institutional 
care without daily personal health care services in his home, 
supervised by a licensed professional. VA should therefore 
grant the veteran a special monthly compensation rating 
pursuant to subsection (r)(2).
    j. Also, it appears that when Sec.  1114(t) becomes 
effective the veteran will be entitled to special monthly 
compensation benefits under subsection (r)(2) even without 
proving any need for daily personal health care services in the 
home. (Sec.  1114(t) became effective on October 1, 2011 after 
the date of this submission).
    k. Happily, before the injured service member was 
discharged, the VA awarded benefits at SMC(r)(2) rate.
    l. In this case, the excellent brief was not enough. When 
the VA delayed in granting this claim I asked for an 
explanation. I was told that in order for the VA to grant 
SMC(r) the evidence needed to show loss of bowl and bladder 
control. I was able to reach the supervisor of this VA 
component and took her through the entire process. Eventually 
she agreed with our analysis.
    m. This severely wounded veteran need the help of a major 
law firm and NVLSP to obtain, within a reasonable time, the 
proper level of benefits. Not every veteran has access to these 
resources. Therefore, it would be better for all veterans if VA 
raters could learn the complicated VA rules.
    C. VA errors can make simple claims complicated. For 
example, suppose a veteran claims service connection for PTSD. 
The alleged stressor or traumatic event is exposure to combat. 
In some cases a VA regional office schedules a VA examination 
(asking the doctor to determine whether the veteran suffers 
from PTSD and to opine as to whether the current PTSD is linked 
to a stressful event in service. In too many cases, the VARO 
does not take the time to review the record in order to tell 
the examiner whether or not the veteran was exposed to a 
stressor in service. That is a decision VA adjudicators must 
make. Because some VA examiners will not diagnose PTSD unless 
they identify an in-service stressor they provide a negative 
report to the VA (38 C.F.R. Sec.  3.304(f)). Therefore, the 
claim for PTSD would be denied. If the veteran had a Combat 
Infantry Badge (an award that shows combat with the enemy), the 
negative medical opinion would be meaningless. In many cases, 
after this error, the veteran would have to appeal to the BVA 
or the CAVC. This could take years. A simple claim would turn 
into a nightmare.

    THE NON-ADVERSARIAL VA CLAIMS ADJUDICATION PROCESS

    First, I want to stress the obvious. Complex claims for VA 
disability benefits have a higher error rate than simple 
claims.
    As far back as 1991 the US Court of Appeals for Veterans 
Claims (CAVC) held that ``Rather than defending against the 
claims of veterans, the Secretary has a statutory duty to 
assist claimants during the course of the ex parte and non-
adversarial claims resolution process at the regional office 
and before the BVA.'' Manio v. Derwinski, 1 Vet. App. 140, 144 
(1991). Under 38 C.F.R. Sec.  3.103(a) (2013) ``Proceedings 
before VA are ex parte in nature, and it is the obligation of 
VA to assist a claimant in developing the facts pertinent to 
the claim and to render a decision which grants every benefit 
that can be supported in law while protecting the interests of 
the Government.''
    Based on the experience of NVLSP, the most egregious VA 
errors are a result of premature adjudications. For example, 
the errors we have identified reveal that VA adjudicators 
failed prior to issuing an initial rating decision, even to try 
to satisfy the VA statutory duty to assist the claimant by 
obtaining the evidence needed to substantiate the claim. The 
VAROs incorrectly adjudicated and prematurely denied claims 
based on inadequate evidence (especially inadequate VA medical 
examinations).
    Over the past 15 years, I have traveled to many VA regional 
offices as part of a quality review team for The American 
Legion. I have personally visited over 40 VA regional offices, 
some more than once. My job, as part of the Legion team, was to 
check the quality of adjudications at the various VA regional 
offices. The Legion should be commended for spending the time 
and money to do these reviews. Prior to that time, when I 
worked for the VA part of my time was spent in what was then 
called Statistical Quality Review (essentially VA Central 
Office quality review). Working for the Compensation and 
Pension Service, we checked the quality of adjudications in all 
VA regional offices (ROs). In addition, I currently review and 
approve or reject many BVA decisions that an NVLSP attorney 
proposes that we appeal to the CAVC. Based on that combined 
experience and based on the entirety of my work for NVLSP. I 
can tell you the following:
    * The current error rate is somewhere between 30 and 40% 
(in some ROs it is higher). For example, the Legion quality 
review team identified errors in 35% of the cases in 
Indianapolis; 64% of the cases in Baltimore had errors; 31% of 
the cases reviewed in Nashville had errors; and 64% of the 
cases reviewed in Oakland had errors. (In the Legion reports 
errors were described as problems or comments.)
    * It is unrealistic to assume that the accuracy rate at the 
VA regional offices will ever approach 98%. Please note that 
over 70% of claims appealed to the BVA are reversed or remanded 
and over 70% of BVA decisions appealed to the CAVC are reversed 
or remanded. I should also note that NVLSP obtains a reversal 
or remand in over 90% of the cases it takes to the CAVC.
    * Many claims that should be adjudicated (or at least 
invited) are ignored by VA adjudicators. The VA Claims 
Adjudication Manual (M21-1MR) makes it clear that when 
preparing a decision, the VA regional office adjudicator must 
recognize, develop, and/or decide all issues, whether: 
expressly claimed, implied, informal, potential, mandated, or 
ambiguous. (See M21-1 MR PART III, Subpart IV, Chapter. 6, 
Section 2.B.2 a. Recognizing Issues When Preparing a Decision.)
    * The most common errors are:
    - premature denials based on inadequate development;
    o under evaluation of mental conditions;
    o under evaluation of joint disabilities;
    o failure to consider presumptive service connection; and
    o failure to inform VA medical examiners what facts have 
been accepted as true by VA adjudicators. (If the VA examiner 
does not know that a fact must be accepted as true then the 
medical opinion may be worthless because the VA examiner may 
provide an opinion based on the wrongful premise that the 
veteran's statement is not accurate because it is not supported 
by other evidence of record.)
    As you know, there is always tension between quantity and 
quality. In fact, faced with a growing backlog caused by a 
surge of claims from OIF and OEF veterans and with the 
compounded impact of many years of premature adjudications that 
forced claimants to appeal or file reopened or repeat claims, 
the issue of quantity vs. quality has gained increased 
importance. Unfair, premature denials cause unnecessary appeals 
and years of delay before deserving veterans obtain justly 
earned benefits. Adjudicating many claims quickly does no good 
if many of these adjudications are premature and many deserving 
veterans are unfairly denied. Many veterans will appeal and the 
overall backlog will simply grow.
    The most important and pervasive problem facing veterans 
seeking VA disability benefits is the eagerness of some VAROs 
to adjudicate claims before all necessary evidence has been 
obtained. This is especially true for complex claims. For 
example, some VAROs prematurely deny claims based on inadequate 
VA examinations. In some cases, even where the VA examiner 
clearly fails to respond to a specific question asked by the 
RO, the examination report is not returned as inadequate. 
Instead, the claim is adjudicated and denied on the basis of 
the inadequate report. In other instances, claims are denied 
before all service medical records are received. Other claims 
are sometimes denied before the veteran has a fair opportunity 
to submit independent medical evidence. These all-too-frequent 
cases of premature denial result from an over-emphasis on 
timeliness and a lack of accountability.
    It is clear to NVLSP that the way the VA evaluates its 
adjudicators and the way the VA awards work credit encourages 
sloppy adjudication resulting in premature, unfair denials. 
Therefore, the first thing those who manage the VA need to do 
is to admit there is a real and very serious problem with the 
quality of VA adjudications. NVLSP believes that the problems 
within the VA claims adjudication system are so serious that 
recent innovations such as paper-free or electronic claims 
processing, and different ``lanes'' for specific types of 
claims, while helpful, will not be enough to fix the problem.
    Potential Solutions
    I wish to commend the Under Secretary for Benefits, General 
Allison A. Hickey, for her commitment to the Fully Developed 
Claim (FDC) program. This FDC initiative could be the best 
thing the VA has attempted in the last 40 years.
    That said, the VA work measurement system has to be 
overhauled so that there is a balance between quality and 
quantity. Also, the VA needs to acknowledge the complexity of 
its claims adjudication system and continue to increase the 
number of adjudicators to work these claims. At the current 
time, based on my 39 years working in veterans law and 
especially my quality review experience, I can confidently say 
that most regional office need more workers just to keep up 
with the current workload. More adjudicators are desperately 
needed if the backlog is to be reduced and initial claims and 
appeals are to be accurately adjudicated within a reasonable 
amount of time.
    The following suggestions should be considered:
    1. The VA should be required to submit to an independent 
quality review to validate the quality of work performed in the 
individual VA regional offices.
    2. The pay grade levels of VA raters and Decision Review 
Officers should be raised on the condition that these employees 
are held accountable for the quality of their work (rewards for 
accurate prompt adjudications, and adverse personnel action for 
unacceptable levels of quality).
    3. Congress needs to continue to provide additional funding 
for more adjudicators.
    4. Adjudicating from electronic records is a laudable goal 
if complete records can be obtained and if the database permits 
logical searches.
    5. Finally, the adjudication culture at the VAROs needs to 
be changed. Many VA managers unfortunately act like they are 
producing widgets rather than adjudicating claims filed by real 
people. Their goal should not be just prompt adjudication; the 
goal should be a timely, accurate and fair adjudication - which 
in the long run is the fastest way to finally adjudicate 
claims. I want to note that the current VA management is trying 
to do this but more needs to be done.
    NVLSP is not demanding perfection from VA managers and 
adjudicators. NVLSP, however, feels that unless the 
adjudication culture is changed, unless the VA can hire more 
adjudicators and unless the VA changes the way it counts its 
work, there will be no significant improvement.

    Executive Summary

    In general there are three types of complex claims:

    (1) some claims, by their very nature, are very 
complicated; (2) some claims can become complex as they are 
developed by VA or as evidence from the claimant is submitted; 
and (3) some claims can become complex because of VA error.

    Examples

    (1) Inherently complicated - claims involving special 
monthly compensation; (2) claims that can become complicated 
such as claims for direct and presumptive service connection; 
and (3) claims that VA errors make complex (claims that are not 
properly adjudicated and prematurely denied).

    Non-Adversarial claims adjudication process

    (1) Complex claims have a higher error rate; (2) there is 
an ex parte and non-adversarial claims resolution process at 
the regional office and before the BVA; (3) the most egregious 
VA errors are a result of premature adjudications; (4) the 
current error rate is somewhere between 30 and 40%; (5) it is 
unrealistic to assume that the accuracy rate at the VA regional 
offices will ever approach 98%; (6) many claims that should be 
adjudicated (or at least invited) are ignored by VA 
adjudicators;

    The most common errors are:

    (1) premature denials; (2) under evaluation of mental 
conditions; (3) under evaluation of joint disabilities; (4) 
failure to consider presumptive service connection; and (5) 
failure to inform VA medical examiners what facts have been 
accepted as true by VA adjudicators.

    Solutions

    (1) The VA should be required to submit to an independent 
quality review; (2)
    Make VA raters and Decision Review Officers accountable for 
the quality of their work; (3) Hire more VA adjudicators; and 
(4) The adjudication culture at the VAROs needs to be changed.
    Mr. Runyan. I thank the gentleman. And with that, I know we 
have pending votes on the floor but we may get to questions 
after Mr. Hearn does this. If not we will go into recess and we 
will come back afterwards. So Mr. Hearn, you are now recognized 
for your testimony.

                  ORAL STATEMENT OF ZACH HEARN

    Mr. Hearn. Good afternoon, Mr. Chairman, Ranking Member 
Titus, and members of the committee. We are here to talk about 
the implementation of special operations lanes. VA created 
these to address accuracy. What we never talk about, though, is 
why accuracy matters.
    VA estimates they will process over a million claims again 
this year. The difference between their goal of 98 percent 
accuracy and even 97 percent is over 10,000 veterans who may 
not get the benefits they earn. We all know the real gap in 
accuracy is far more than one percent, as well. We are talking 
every year a small city in America full of veterans who may not 
get the benefits they earn through their hard years of service. 
Each of those veterans is a story and a family too, unique in 
its own way like the stories we just heard from the first 
panel. That is why the American Legion is constantly raising 
the importance of accuracy. Because for all those veterans who 
wind up on the wrong end of those errors VA's accuracy rate may 
as well be zero.
    Why are there still problems? It is a complicated system. 
It does take experience and attention to detail to get things 
right. Putting experienced personnel on the tougher claims is a 
good start. When VA has the ability to ensure this is 
consistently applied across the country with the right 
personnel to execute this plan it will probably help with 
improving the figure. But there are still some system problems 
which hamper VA's ability to get it right for veterans.
    I have been fortunate to travel to many VA offices as part 
of the American Legion's regional office action review program. 
For over 15 years we have been conducting these week-long 
intensive visits to VA offices to review claims and assess VA 
accuracy, and to see inside the offices outside the Beltway and 
get a true picture of how the implementation works in the 
field. Through these visits we have seen patterns. For example, 
consistency from one office to another office leaves much to be 
desired. Policies embraced by leadership in one office may be 
given lower priority in other offices. And with mixed 
commitment you get mixed results.
    VA also seems to struggle with finding the right balance of 
development for claims, which leads to adjudication errors. You 
cannot build a house on a shaky foundation. On our review 
visits we examine a sample of dozens of recently adjudicated 
claims for veterans the American Legion represents. Often the 
claim has either been underdeveloped or overcomplicated. Both 
of these early errors are a recipe for later errors later in 
the process.
    VA has a tendency to under develop claims and leave 
adjudicators with too little information to make a fair 
judgment on service connection or rating. For example, in 
April, 2013 we visited the Nashville Regional Office. According 
to the April 27th Monday morning workload report Nashville had 
a 95 percent accuracy rating for the previous three months. 
During the review of 22 cases we found 11 where we commented 
regarding case development to include seven with errors.
    Our review paints a far dimmer picture of Nashville's 
accuracy than indicated in the workload report. In one case a 
veteran was seeking service connection for PTSD. Evidence 
within the file obtained from a VETS Center indicated the 
veteran served in the Persian Gulf during Desert Storm and was 
chronically fearful of death due to chemical warfare. 
Additionally, the VETS Center exam noted treatment for symptoms 
associated with PTSD in service and at the time of the VETS 
Center exam had extensive symptoms associated with PTSD. No 
exam was provided by VA. A rating decision denied the veteran 
service connection for the condition due to a lack of 
diagnosis. Yet if a veteran exhibits symptoms of a condition a 
VA compensation and pension exam should be afforded. The 
veteran exhibited symptoms that should have triggered an exam. 
An exam was never scheduled and instead VA opted to simply deny 
the veteran benefits without due process.
    Conversely sometimes VA does not seem to know when to stop 
and overcomplicates a claim. In June we visited the Reno RO. 
The June 3rd workload reports indicate they had a 93.2 percent 
accuracy rating. Our review of cases resulted in comments 
regarding the adjudication of 59 percent of reviewed claims for 
VA benefits. In one instance a veteran was seeking service 
connection for PTSD. During a July, 2011 VA C&P exam the 
examiner linked the veteran's condition to military service. 
The regional office returned the exam results in August, 2011 
to the examiner to again restate his opinion and again the 
examiner stated the veteran's PTSD is related to service. After 
the second review VA finally adjudicated the benefit in 
September, 2012 and sent the notice letter in January, 2013. VA 
conducted two exams but only one was necessary and it took over 
two years from the date of the first exam to adjudicate the 
claim, and then another four months to notify this veteran.
    The American Legion believes these problems could be 
mitigated by adopting some strategies our National Commander 
Dan Dellinger advocated for during his testimony before 
Congress this fall. Fixing the work credit system that 
currently places more emphasis on actions completed than 
actions done right; aggregating common errors to develop a 
training plan; these are steps we want to see taken. Fixing the 
accuracy problem needs to start with the right mind set. The 
mind set should not be achieving 98 percent accuracy. The mind 
set needs to be I need to get every step right for this 
veteran. Until the problem gets fixed we are losing the good 
faith of a city of veterans every year.
    Thank you and I will be happy to take questions.

                PREPARED STATEMENT OF ZACH HEARN

    According to a February 2013 Congressional Research Service 
(CRS) report, service members have either suffered or have been 
diagnosed with the following complex conditions from 2000-
20121:
    * 131, 341 diagnosed with posttraumatic stress disorder 
(PTSD)
    * 253,330 diagnosed with traumatic brain injury (TBI)
    * 1,715 underwent amputations due to service in Iraq and 
Afghanistan
    The Department of Veterans Affairs (VA) states 20 percent 
of women and one percent of men indicate they suffered military 
sexual trauma (MST) in service2. VA defines MST as ``any sexual 
activity where you are involved against your will.'' A May 2013 
Associated Press article indicates in 2012, more than 85,000 
veterans sought treatment due to injuries or diseases resulting 
from MST; 4,000 sought VA disability benefits as a result of 
the condition3.
    The nature of conditions such as PTSD, TBI, MST and claims 
that require special monthly compensation (SMC), are often 
complex in nature and require a deeper understanding of VA 
disability benefits than many other types of VA disability 
claims. In order to achieve Secretary Eric Shinseki's laudable 
goal of 98 percent accuracy on all claims by 2015, VA needed to 
take measures to ensure these complex claims were handled by 
people experienced and expert enough to reduce the risk of 
error.
    To this end VA established segmented lanes in each of its 
regional offices designed to provide a specialized approach to 
claims' adjudication depending on the nature of the claim or 
the manner that the veteran or dependent sought disability 
benefits. The tough claims would be developed and adjudicated 
in the ``special operations'' lane with senior VA raters 
adjudicating these complex claims.
    In concept, this practice of putting the best, most 
experienced personnel on the task of adjudicating the most 
difficult claims is laudable and logical. The American Legion 
supports and even utilizes the idea of ensuring newer, less 
experienced employees handle simpler, more straightforward 
claims while experienced hands do the heavy lifting on the more 
complicated and sensitive claims.
    The American Legion has conducted Regional Office Action 
Review (ROAR) visits to VA Regional Offices (VAROs) for over 15 
years, performing quality review oversight and evaluating work 
procedures during an intensive weeklong process. Recognizing 
The American Legion's expertise in this area as the only 
Veterans' Service Organization with so comprehensive a review 
process, the White House contacted The American Legion to 
coordinate an evaluation of the Fully Developed Claims (FDC) 
program over 2012 and 2013. These visits were performed in 
conjunction with the White House, Joining Forces, VA Central 
Office officials, and later with Disabled American Veterans 
(DAV) as the program expanded.
    The American Legion had the opportunity to visit eight 
VAROs beginning in December 2012 and concluding in June 2013 
during the implementation phase of the FDC program. In addition 
to examining the FDC program, American Legion experts discussed 
issues surrounding FDC with VA raters and senior staff, to 
include the implementation of the segmented lanes by VA. As 
always with ROAR visits, recently adjudicated claims under 
American Legion Power of Attorney (POA) were reviewed by Legion 
staff and Legion accredited attorneys contracted through the 
National Veterans Legal Services Program (NVLSP) to gauge VA's 
accuracy and check for adjudication and development errors.
    Unfortunately, during these visits, it became clear through 
discussion with senior VARO staff that experienced staff is at 
a premium. Much of the staff has less than five years 
experience and may not have either the experience or knowledge 
base to accurately adjudicate complex claims. While the concept 
of the ``special operations'' lanes is still sound, performance 
in individual VAROs may be inconsistent, because the experience 
base necessary to implement the plan may not exist.
    Developing statistics on VA's current accuracy rating 
regarding complex claims such as PTSD, TBI, MST, and claims 
that involve SMC presents a challenge. While VA's Monday 
Morning Workload Report includes VA's accuracy for claims' 
adjudication, it fails to include accuracy ratings for the 
types of claims adjudicated; therefore it is difficult to 
determine whether this approach is helping improve the 
adjudication of these special claims.
    Furthermore, VA's accuracy statistics from the Monday 
Morning reports are not consistent with the review of recently 
adjudicated claims as conducted by the American Legion ROAR 
teams. When visiting VAROs over the past year, ROAR staff 
reviewed 260 claims adjudicated by the VAROs. Of those 260 
claims, 55 percent were identified as having errors, 
particularly regarding the development of the claim. This 
statistic is in stark contrast to the approximate 90 percent 
accuracy rating in claims' adjudication indicated by VA's 
Monday Morning workload reports.
    For conditions such as PTSD and TBI, it is not simply the 
accurate adjudication of the individual condition that veterans 
face but also the conditions that may have either manifested 
secondary to either PTSD or TBI or were aggravated by the 
conditions.
    Cardiovascular, gastrointestinal and musculoskeletal 
conditions have been identified as being possibly related to 
PTSD4; yet The American Legion's national appeals 
representatives at the Board of Veterans' Appeals (BVA) 
routinely have claims remanded by BVA due to VA's failure to 
consider the relationship of condition such as hypertension and 
gastro esophageal reflux disease (GERD) to PTSD. This is 
particularly frustrating given the support for this link is in 
VA's PILOT database for PTSD.
    When VA is not under-developing claims, they can be prone 
to over complicating claims that should be simple.
    The American Legion's network of over 2,900 accredited 
service officers often come across claims needlessly delayed 
while VA continues to seek additional records for conditions 
already adequately reflected in the record, or orders 
extraneous exams long after medical examinations have connected 
a current condition to the veteran's service and displayed the 
level of disability to a degree sufficient to enable rating the 
claim. These needless exams and record searches can add months 
or even years to a veteran's wait times.
    In order to achieve 98 percent accuracy, The American 
Legion believes VA must develop a full understanding of the 
strengths and weaknesses of its adjudicators and the common 
errors commitment systemically in the claims system. The 
American Legion believes through the data able to be tracked in 
the VBMS system, decisions of the Court of Appeals for Veterans 
Claims (CAVC), the Appeals Management Center (AMC) and the BVA, 
VA is sitting on a goldmine of data about where they can work 
to improve accuracy, yet this goldmine remains untapped. The 
American Legion would like to see VA develop a system to 
analyze the vast trove of error information, track it, and use 
it to develop training to improve results. In short, to ensure 
the highest reward for the training investment, VA should 
identify areas that training is required for its raters and 
provide specific training based upon the nature of the claim or 
condition and the identified common errors with those types of 
claims.
    When The American Legion asked VA if they were tracking 
these statistics internally, VA responded: ``We currently do 
not post or provide quality data based solely on diagnostic 
codes.'' If VA is collecting data on accuracy of adjudication 
based upon diagnostic code, it would be helpful for determining 
the success of programs such as the ``Special Operations'' 
lanes if this data was released for public review.
    The American Legion believes VA should provide better 
information regarding VA disability claims in a public venue5. 
Veterans and their families should have the opportunity to know 
the accuracy of adjudications.
    As the individual conditions treated by the ``special 
operations'' lanes are considered, The American Legion is 
deeply concerned not only about the statistics and effects of 
MST, but also the manner that claims associated with MST are 
adjudicated. As disturbing as the statistics regarding MST are, 
the manner in which the claims are adjudicated is equally 
disturbing. A fact sheet published by VA states6:
    Department of Defense forms used in reporting incidents of 
sexual assault or harassment, as well as investigative reports 
during military service are direct evidence to support these 
claims. However, VA knows that events involving personal 
assault or sexual trauma are not always officially reported. 
Therefore, VA has relaxed the evidentiary requirements and 
looks for ``markers'' (i.e., signs, events, or circumstances) 
that provide some indication that the traumatic event happened, 
such as
    * Records from law enforcement authorities, rape crisis 
centers, mental health counseling centers, hospitals, or 
physicians.
    * Pregnancy tests or tests for sexually transmitted 
diseases.
    * Statements from family members, roommates, fellow service 
members, clergy members, or counselors.
    * Request for transfer to another military duty assignment.
    * Deterioration in work performance.
    * Substance abuse.
    * Episodes of depression, panic attacks, or anxiety without 
an identifiable cause.
    * Unexplained economic or social behavioral changes.
    * Relationship issues, such as divorce.
    * Sexual dysfunction.
    In July 2010, VA changed its regulations regarding the 
evidentiary requirements for veterans seeking disability for 
PTSD. Realizing that veterans were often facing difficulties 
providing stressor statements that could not be corroborated by 
VA, VA simplified the adjudication through ``eliminating this 
time-consuming requirement where the claimed stressor is 
related to `fear of hostile military or terrorist activity,' is 
consistent with the places, types, and circumstances of their 
service, and a VA psychiatrist or psychologist, or contract 
psychiatrist or psychologist confirms that the claimed stressor 
is adequate to support a diagnosis of PTSD.7''
    Considering the negative attention the Department of 
Defense has received regarding the manner that it investigates 
and takes appropriate actions regarding MST incidents and the 
number of incidents unreported to authorities, it is plausible 
a veteran who was the victim of MST would not have the 
necessary evidence as indicated in VA's fact sheet regarding 
the adjudication of these claims to support the granting of a 
disability benefit associated with MST. Realizing that latitude 
should be afforded to veterans who were MST victims, The 
American Legion urges VA to ``apply reduced criteria to MST-
related PTSD to match that of combat related PTSD.8''
    It's time to treat the survivors of this horrible crime the 
same way we treat the survivors of war.
    Developing a plan to improve accuracy is essential because 
it has a definite and measurable impact on the lives of 
veterans. It is sometimes difficult to put the importance of 
accuracy in perspective, and to realize the scope of the impact 
of accuracy on these claims, consider the following statistics. 
As previously noted, the February 2013 CRS report indicated 
386,386 servicemembers diagnosed with PTSD, TBI, and/or 
amputations. If each veteran diagnosed with these conditions 
sought service connection, even utilizing VA's favorable 90 
percent adjudication accuracy rating, 38,638 veterans would 
either not be receiving service connected disability 
compensation or would be underrated for these conditions. If 
the accuracy of these claims were closer to the accuracy levels 
documented by The American Legion in the past 12 months during 
ROAR visits, over 212,000 veterans - roughly the size of Reno, 
Nevada9 - would either not be receiving service connected 
disability compensation or would be underrated for these 
conditions. For those veterans, VA's accuracy rate might as 
well be zero.
    Veterans suffering from PTSD, TBI, amputations, or MST are 
often the most vulnerable veterans. Mobility, employment, and 
treatment are just some of the many issues that these veterans 
may face. With denial of these benefits, the opportunity for VA 
health care may not exist. Furthermore, denial of these 
benefits could exclude veterans from additional benefits they 
are entitled to, such as federal hiring preference and 
elimination of the VA funding fee for VA mortgages and VA will 
have failed to honor Abraham Lincoln's call ``to care for him 
who shall have borne the battle and for his widow, and his 
orphan''.
    On behalf of our National Commander Daniel M. Dellinger, 
and our 2.4 million members, The American Legion thanks this 
subcommittee for their diligent attention to the disability 
benefits process. The American Legion will be watching closely, 
and hopes to work closely with both VA and Congress to ensure 
the ultimate outcome is in the veterans' best interest.
    For any questions regarding this testimony please contact 
Ian de Planque, Deputy Legislative Director of The American 
Legion at (202) 861-2700 or [email protected]
    1 CRS Report for Congress, U.S. Military Casualty 
Statistics: Operation New Dawn, Operation Iraqi Freedom, and 
Operation Enduring Freedom (Washington, D.C., February 2013), 
pp. 5-10.
    2 http://www.ptsd.va.gov/public/pages/military-sexual-
trauma-general.asp
    3 http://www.nydailynews.com/news/politics/military-sexual-
assaults-heavy-toll-veterans-article-1.1349140
    4 http://www.ptsd.va.gov/professional/pages/ptsd-physical-
health.asp
    5 Resolution 99: Increase the Transparency of the Veterans 
Benefits Administration's (VBA)
    Claims Processing, - AUG 2012
    6 http://www.benefits.va.gov/BENEFITS/factsheets/
serviceconnected/MST.pdf
    7 http://www.va.gov/PTSD--QA.pdf
    8 Resolution 295: Military Sexual Trauma, - AUG 2012
    9 http://quickfacts.census.gov/qfd/states/32/3260600.html
    ---------------

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    Mr. Runyan. Thank you, Mr. Hearn. And seeing that there is 
probably less than five minutes left on the clock on the floor, 
we are going to have to go into recess, and be back in half an 
hour to 40 minutes. So as of now the committee stands in 
recess.
    [Recess.]
    Mr. Runyan. The subcommittee will come to order and we will 
begin a round of questioning and I will start that off. And my 
first question will be for Mr. Abrams. You note in your written 
testimony that one manner in which claims become complex is 
because of VA error. Cases of this sort are often appealed and 
then remanded, often more than once, further increasing the 
complexity of the claim procedurally. Number one, can you 
elaborate on the common types of errors you see which causes 
claims to become more complex due to VA error on appeal? And 
number two, do you think that greater focus on appealed and 
remanded claims would assist VA in learning from its mistakes 
and making less of these types of errors in the future?
    Mr. Abrams. Yes, I can. Let me give you an example. Suppose 
a veteran files a claim for PTSD. The veteran alleges that he 
suffered a stressor when exposed to combat. The veteran's 
service records show a combat infantry badge, which means the 
veteran was in combat. However, the VA in an effort to go fast 
sets up an examination and fails to tell the medical examiner 
to accept as true the fact that the veteran was exposed to 
combat. The VA examiner looks at the file, does not see any 
evidence of a stressful incident in service, does not know how 
to read a DD-214, and determines that he could not diagnose 
PTSD without a stressor. Therefore he writes a negative medical 
opinion and diagnoses the veteran with anxiety disorder or 
something like that. The VA then denies the claim. To resolve 
that claim could take five to eight years. And the VA needs to 
take the time at the start, this is just a simple error, I 
could get into complicated ones and we would be here much too 
late. But that is a simple error that can be fixed if the VA 
takes the time at the start to tell the doctor what evidence to 
accept as true. That is not for the doctor to determine, that 
is for the adjudicator, the VA adjudicator to make that, you 
know, finding.
    Your second question was if they got more involved, I am 
not sure what you mean by more involved? With remands?
    Mr. Runyan. If they paid closer attention to the process.
    Mr. Abrams. Well they should. They need to analyze the 
types of remands that come back from the Board and take action 
to train on that. We certainly look at thousands of cases a 
year and we keep a list of the common errors that the VA makes 
that we can win at the Court for. And in my testimony we listed 
some of those that you can see. But I am hoping that the VA 
does that. I am not sure that they do.
    Mr. Runyan. Thank you. And again for Mr. Abrams, and Mr. 
Gillums maybe, you both provided examples in your written 
testimony of issues with VA adjudicators properly calculating 
the amount of special monthly compensation for severely 
disabled veteran. Why do you think that calculating SMC is so 
problematic for VA adjudicators?
    Mr. Abrams. Do you want me to answer that first?
    Mr. Runyan. Please. Yes, please.
    Mr. Abrams. First of all in my experience, and I think you 
have staff members who have traveled to, you know, ROs that 
have seen this too, SMC is inherently a complicated issue. 
Second, there are some things that the VA looks for magic words 
for that are not there. In the case I wrote about in my 
testimony the veteran's military doctor said he had lost all 
function in his right hand and he had lost the use of his right 
foot. The VA did not conceded loss of use of the right hand 
because the doctor did not say the magic words. When we 
contacted the doctor the doctor changed his written comments 
and said he had lost the use of the right hand. Well loss of 
use of a right hand and loss of use of a foot generates an L, 
SMCL. He already had an L because he was in need of A&A because 
his traumatic brain injury. This is a man who was shot in the 
head in Iraq, had 18 service-connected conditions, operates on 
a grade-school level, has tubes in his head that fluid comes 
out of, has terrible scars on his face, lost the sense of taste 
and smell, and is, you know, has suffered tragic wounds. I got 
involved because I wanted to help this guy. My heart went out 
to him. And even after we produced clear evidence that he 
should get SMCR2, slam dunk, the VA did not act. So I finally 
was able to reach the component of the VA that does that work 
and I asked them why action had not been taken. And they told 
me they were, that they were looking for loss of bowel and 
bladder control. And I said that is not relevant, you do not 
need it. He already qualifies. And the lady was able to hear me 
out and I took her through the regulations and statutes, which 
would take me a long time to go through, I wrote it up. And the 
veteran ended up getting the R2. It is on our website if you 
want to go look at the whole thing. We had a mix of the VA, 
like the band in Animal House that marched into the wall, it 
did not have loss of use, it only had loss of function. They 
were not going to accept those words. Kind of silly.
    But secondly the people that were doing the work did not 
know the law. The VA needs to do more to train people to 
understand SMC. The PVA, the DAV, the Legion, MOPH does a lot 
of work on that issue. And if you look in our textbook we have 
a formula that service offices in VA can use to properly 
evaluate. It is complicated and you have to look at it each 
time. Thank you.
    Mr. Runyan. Thank you. Mr. Gillums?
    Mr. Gillums. In order to effectively adjudicate an SMC 
claim you almost have to have an intuition for things that are 
pretty abstract. Like how do you measure need? In one case you 
will have a veteran with ALS. Because he or she has trace 
function in their legs, or can barely stand, the rater will 
find that the veteran has useful function of legs. And we argue 
it has to be useful in terms of daily living. And so a lot of 
it is over time it will be cultural. This culture, this new 
crop of raters are being trained to follow rules.
    I will give you an example. If a veteran presents with a 
letter from his clinician saying that he needs skilled care, 
that letter will trigger not some deliberation on the rater's 
part. It triggers the need for a C&P exam. The C&P examiner 
will render an opinion as to whether the skilled care is needed 
or not. And depending on what the C&P examiner says will 
dictate whether the claim is accepted or denied. The problem is 
in the past if you were a trained rater and you understood SMC, 
you knew how to weigh evidence. You knew how to weigh two 
conflicting medical opinions and in that case it should be 
resolved in favor of the veteran. Well increasingly this 
contemplative aspect of rating SMC is being pushed out of the 
culture, being pushed out of the process. And so there is no 
contemplation of evidence. It is either there or it is not. 
This person can either walk because he has got three out of 
five function, or they cannot with no exploration of whether it 
is useful or whether the three out of five results in multiple 
falls because the veteran tries to stand but cannot and incurs 
subsequent injury.
    So a lot of it has to do with the fact that I believe the 
VA is going away from this inductive reasoning way of training 
its new people that probably made claims adjudication a bit 
longer, but it was more accurate if you got it right the first 
time. And so that is my insight.
    Mr. Runyan. Thank you. And I recognize Ms. Titus for her 
questions.
    Ms. Titus. Thank you very much. I will ask Mr. Gillums and 
Mr. Hearn two questions. First, we have heard a lot about 
putting these complex cases in these lanes: easy, medium, and 
hard. I understand the value of that. But I wonder if that is 
really effective. Is that not oversimplifying? Would we be 
better off to nuance it a little more than that? Are we really 
creating a system that is going to produce more errors down the 
road and contribute to the appeals backlog? That is my first 
set of questions.
    Second, I would go back to something I mentioned earlier: 
rate as you pay. We have talked about complex cases. Would it 
not help veterans that as you rate some of the easier aspects 
of these cases that have a number of different problems, that 
veterans get paid for those as you rate them instead of waiting 
until the end?
    Mr. Gillums. I think the lanes process has worked. The 
field staff that work for me like it. They like being able to 
go to somebody who is ostensibly a specialist in that type of 
claim, whether it is a Post Traumatic Stress Disorder, military 
sexual trauma, one of our severe disability cases. So it has 
worked. It really depends on the people, though. It really 
depends on how it is managed. And that can vary from regional 
office to regional office. Every regional office is not doing 
the wrong thing. A lot of them are doing the right thing. It is 
the ones that we hear about, though, where it does not matter 
what process they have in place. If the people are inadequately 
trained the greatest process in the world will not help them.
    To your question about the pay as you go, I think that for 
veterans who just need relief, they need some resources, it 
might be okay. My fear though is that when you pay a veteran, 
let us say a veteran gets that 100 percent rating, the 
mentality will be you have got your 100 percent rating, what 
more do you want? We have got you that, why are you coming back 
to us? Or that is going to be counted as a completed claim. I 
mean, how do you monitor completion of that claim? If, you 
know, the veteran is 100 percent and getting a check, there is 
still a lot of work that needs to be done in our cases. But you 
know, but we would have to make sure that there is no creeping 
standard where if they are getting paid that kind of sits on 
the back burner.
    Mr. Hearn. This past year when we were going out and doing 
those trips for the FDC and we visited, to include the one 
where we visited in Reno, we did discover that it did bring 
some order to the regional office by having those segmented 
lanes. One of the things, though, that when we went out there I 
would ask employees different questions. And one of the ones 
was how much experience do you have? And it was overwhelming, 
and I would talk to coaches and some more middle management and 
senior staff, and then talk about the relative greenness, I 
guess, of the staff at that regional office.
    Now I have heard senior leadership from VA say on repeated 
occasions that, well, the effects of the Nehmer case and the 
increase in claims due to Nehmer has affected the backlog. And 
then we have heard conversation about 9/11 and the increase in 
cases from there. But the one thing that no one seems to 
discuss is that you cannot beat back the hands of father time. 
And that we have now hit an era in this country where baby 
boomers are retiring in larger numbers. Now we did not go back 
and, they did not balloon the VA, I guess, at the time when 
they should have. And so now you have got this knowledge 
vacuum, I guess, in the regional office. So there just is not 
that much, there are not enough people, A, but B, there is not 
enough experience there. So it is, yes, it does help. But I 
think a lot of it, too, is that they just simply do not have 
that much experience within that regional office.
    And then to go to the rate as you pay, I do think that it 
would be beneficial. If you think about the effects that you 
could if let us say somebody is trying to get service connected 
for three or four conditions, and you get them to the 50 or 60 
percent, now they have got access to free healthcare through 
VA. In this age of ACA that is a very good avenue for them.
    I also think that in the cases of preference for federal 
employment when it comes to issues dealing with VA mortgages 
and not having to pay the funding fee, of course these are 
important. And also you are getting money into the veteran's 
pocket. And so I do see the benefits. I agree, there probably 
are some concerns that we should look at as to how VA would 
monitor this and make sure that cases and claims are not just 
being set by the wayside while other things are occurring. But 
it is something worth considering, I think.
    Ms. Titus. Thank you.
    Mr. Abrams. I would like to add something.
    Ms. Titus. Thank you. Is that all right, Mr. Chairman?
    Mr. Abrams. It is the policy of the VA that when it has 
enough evidence to pay partially, it pays. The problem is that 
the workers do not get any work credit and therefore they are 
not encouraged to do it.
    Ms. Titus. Right.
    Mr. Abrams. And we find many, many cases. So it is not a 
matter of VA policy which says when you have enough evidence 
and the veteran should be service connected, pay them at this 
level, and then when we get more we will, you know, up it. They 
do not want to take the time to do it because they are measured 
by how many cases they do, which gets back to my point of the 
work measurement system. And Sherman's point that if you give 
somebody something maybe he will go away is the thought and we 
will not have to, or she, and there will not be any more to do.
    Ms. Titus. Mm-hmm.
    Mr. Abrams. So they really want to get rid of the case at 
that point. Thank you.
    Ms. Titus. Thank you.
    Mr. Runyan. I thank the gentle lady. Mr. Michaud?
    Mr. Michaud. Thank you very much, Mr. Chairman, and Madam 
Ranking Member for having this very important hearing. 
Information that the VA has provided us recently suggests that 
simply breaking out the work load into what they call those 
segmented lanes resulted in a ten percent processing increase 
during the first 60 days. Also easy claims saw an increase in 
timeliness of 100 days faster than the special operation 
claims. However, we know that VA continues to do a poor job in 
handling some of our most challenging claims. As the VA OIG 
noted in their testimony, in their first round of inspections 
31 percent of the TBI claims reviewed showed that staff had 
made errors. After informing staff of errors and VA taking 
action, the VA OIG returned to note that 29 percent of TBI 
claims reviewed were found to be in error. And you look at 12 
of the 20 offices reviewed were non-compliant with VBA's own 
policies for two consecutive inspections. They also noted that 
even after extreme simplification of PTSD claims, five percent 
of these claims are still incorrect.
    In my mind, you know, the facts speak for themselves, that 
we need to take the segmented lanes a step further by creating 
a few, you know, specific offices that specialize and focus on 
complex claims like TBI and PTSD and MST. These offices need 
specialists that are aligned in cross-functional teams but 
focused and trained in extremely complex cases. I believe that 
most of you at the table support H.R. 2088 that would create 
Centers for Adjudication Excellence. And my question, I will 
start with Mr. Gillums, in your testimony you articulate the 
problem with underqualified individuals handling complex 
claims. In your opinion would we be better off if we 
specialized in these complex medical conditions? And the other 
two panelists can answer that as well.
    Mr. Gillums. I do not remember how I characterized it but I 
think it is less about qualifications in some of the cases I 
have seen and more about the rules that constrain their ability 
to make judgments using the experience that they might have 
accumulated over the years. The rules are just different. So 
even in cases where you have got somebody who is qualified, the 
rules are different. The rules say you have to do these steps, 
you can no longer exercise common sense. If it says hospice, 
and common sense says that that is probably skilled care, you 
still have to ask for an exam otherwise the rating stands. That 
is a wrong rating. It is an inaccurate rating. And so that is 
where you get an error in that case. You do not exercise 
reasonable doubt. That is an error. You have to exercise 
reasonable doubt when the evidence is in equipoise. And they do 
not do that. So that is an error of law. So it really depends 
on a convergence of both an inexperienced corps of new raters 
as well as raters who have the knowledge and experience who do 
not have the freedom to exercise that judgment when it is 
necessary.
    And if you were, you know, sort of to compartmentalize that 
knowledge it really just depends on how you run it. If it is, 
if they are allowed to exercise that qualitative, deliberative 
thought process as they look at these claims in these 
compartmentalized Centers of Excellence, then it would work. 
But I do not think that is necessary. I think you could do the 
same thing with your special ops lanes but just give them the 
ability to think and make decisions, exercising good judgment, 
versus having rules dictated as a quality review standard.
    Mr. Michaud. Mr. Abrams?
    Mr. Abrams. Thank you. First of all, I think the essence of 
fairness is time. If we set up lanes and they are pressured to 
go real fast, it will not matter if they are the most 
knowledgeable people on the planet. They will make errors. 
Secondly, you are taking the veteran's claim away from his 
local representative. The American Legion or other service 
organization representative in Boise, Idaho is not going to 
have access to the file or deal with the raters if the case 
goes to Denver. I am making that up, but that is a problem.
    In any case until you fix how they count their work, these 
are fixes that sound good on paper but are not going to make a 
major impact. That is the first thing to do. It sounds great 
but I also worry that if people are trained to deal in SMC, and 
that is all they do, then the rest of the VA raters are not 
going to know SMC. And unless they are trained they will only 
have a small component of people to do it. There is a lot of 
pros and cons to do it.
    It is worth a try if we can also implement some way to give 
them the time to do it or to hire a lot more people to help. I 
keep saying that, a lot more people. Thank you.
    Mr. Hearn. Thank you. Generally speaking, like Ron has 
said, the American Legion favors the idea of local adjudication 
for claims. I think what you are saying, though, is that you 
are essentially going to create a workforce of warrant officers 
where they are specialized in particular areas. And this is the 
thing that I kind of question. If you are a high performing 
regional office, and you are assigned special monthly 
compensation, and then you are working in a different office 
and you are assigned something that is a little bit easier, say 
like tinnitus or something, what is that going to do to the 
morale for the people working in tinnitus? I mean, I would not 
feel too good for myself if they say well, this is all they 
think of me, I am stuck with the tinnitus game.
    And so I do not think that that is necessarily the way that 
you want to go about it. I think that you have to have a 
comprehensive approach to training and evaluation. I was 
speaking earlier in our office about it. I said if you, ten or 
12 years ago when you passed No Child Left Behind the big 
concern in the education community was, well, teachers are 
going to start teaching to the test. And that is what some of 
these evaluations do. When they are looking at their star team 
reports it is a checklist. And Congresswoman Titus could attest 
to her years in academia, you do not want to test somebody's 
knowledge on multiple choice exams. You want to test them on 
blue book exams. Because that is comprehensive understanding. 
And that is what our big concern is at The American Legion. 
Thank you.
    Mr. Runyan. Thank the gentleman. And I thank all of you 
today for your testimony and for the work you do on behalf of 
disabled veterans. You are now excused from the witness table 
and we will ask our third panel to come forward.
    This will be our final panel today. We welcome Mr. Tom 
Murphy, Director of Compensation Service with the Veterans 
Benefits Administration; also Ms. Edna MacDonald, who is 
Director of the Nashville Regional Office, accompanying Mr. 
Murphy today. We also welcome Sondra McCauley, Deputy Assistant 
Inspector General for Audits and Evaluations with the Office of 
the Inspector General, Department of Veterans Affairs. Ms. 
McCauley is accompanied by Mr. Brent Arronte, Director of San 
Diego Benefits Inspections Division. We appreciate your 
attendance today. Your complete and written statements will be 
entered into the hearing record. And Mr. Murphy, you are now 
recognized for five minutes.

                  ORAL STATEMENT OF TOM MURPHY

    Mr. Murphy. Chairman Runyan, Ranking Member Titus, and 
members of the subcommittee, thank you for providing me the 
opportunity to discuss the VA's policies and procedures for 
adjudicating complex disability claims. I am accompanied today 
by Ms. Edna MacDonald, Director of the Nashville Regional 
Office.
    The VBA continues to experience an increase in the number 
and complexity of medical issues. Between 2011 and 2013 the 
average number of issues in original claims increased by 31 
percent, from 5.5 to 7.2. In response VBA developed and 
implemented a new operating model.
    VBA has noticed an increase in complexity of the claims 
from the newer generations of veterans who participated in 
Operations Enduring Freedom, Iraqi Freedom, and New Dawn. These 
young heroes have a greater chance of surviving serious 
injuries and often return home with multiple serious 
conditions. In addition, VBA continues to receive complex 
claims from veterans of the Vietnam era. Many of these become 
complicated because they are subject to federal court orders in 
Nehmer v. U.S. Department of Veterans Affairs.
    The new organizational model incorporates cross-functional 
teams working on one of three segmented lanes, express, core, 
and special operations. Lanes were created based on complexity 
and priority of claims.
    The express lane develops and rates claims with a limited 
number of issues and subject matter which could be developed 
and rated more quickly. Core lane includes claims with three or 
more medical issues that do not involve special populations of 
veterans. The special operations lane applies intense focus and 
case management on specific categories of claims that require 
special processing or training. It is comprised of a regional 
office's most highly skilled personnel with specialized 
experienced and training.
    VBA is simplifying ratings by building new decision support 
tools to make our employees more efficient and their decisions 
more consistent and accurate. One of them is the evaluation 
builder and it is essentially an interactive rating schedule. 
The rater uses a series of check boxes that are associated with 
the veteran's symptoms. DBQs are another tool designed to 
simplify rating decisions. They replace traditional VA exam 
reports and capture all needed medical information up front and 
present the findings in a rater friendly format.
    Claims are considered complex for a variety of reasons. 
There are three examples. Due to the complexities of rating TBI 
the special operations lane processes these claims. Since 
March, 2013 all raters in this lane are required to complete 
specialized training. This web-based module is 22.5 hours on 
how to rate a claim for the residuals of TBI. Due to the myriad 
of symptoms that a veteran with TBI may experience, it is often 
unclear which symptoms are solely attributable to TBI. In 
October, 2011 Compensation Service provided guidance that 
examination findings should be related to the veteran's TBI 
condition unless such symptoms are clearly attributable to 
other causes. In addition VBA has instituted safeguards to 
ensure consistency and accuracy. All raters are required to 
obtain a second signature on TBI claims until the individual 
demonstrates 90 percent accuracy in rating such claims.
    As a result of these efforts VBA has seen TBI grant rates 
increase from 21 percent in 2007 to 47 percent in 2013. 
Further, the accuracy of TBI ratings during fiscal year 2013 
was 92.37 percent, slightly higher than the national average 
for all rating claims during the same period.
    Service connection for PTSD requires three things: medical 
evidence diagnosing the condition, an in service stressor, and 
a nexus connecting the two. In 2010 Secretary Shinseki made it 
easier for veterans with fear based PTSD to establish service 
connection. VA added a regulation providing that a veteran's 
lay statement alone can now establish the required in service 
stressor. VA provided extensive training on this regulation 
change to ensure consistent and accurate ratings.
    MST-based PTSD claims are processed by the special 
operations lane as well. Complications generally arise in 
situations where there is no corroborating evidence of the 
stressor in the veteran's military records. In these cases VA 
must notify the veteran that the evidence from outside military 
records may be used to support and claim and must attempt to 
obtain any such evidence identified. In 2011 VBA conducted a 
quality review of 400 MST-based PTSD claims, which found that 
an approximate 25 percent error rate based primarily in 
incomplete development. We developed and implemented an MST-
based PTSD training package that emphasized the proper evidence 
development and recognition of the types of evidence. Following 
the training the MST-based PTSD grant rate rose to a level 
comparable to that of other types of PTSD.
    VA has seen a significant increase in the complexity of 
claims received in recent years. To address this trend VA 
implemented a new organizational model with a special 
operations lane focusing on complex disability claims.
    This concludes my statement, Mr. Chairman. I would be happy 
to entertain any questions you or members of the subcommittee 
may have.

                PREPARED STATEMENT OF TOM MURPHY

    Chairman Runyan, Ranking Member Titus, and Subcommittee 
Members, thank you for providing me the opportunity to discuss 
Department of Veterans Affairs (VA) policies and procedures for 
adjudicating complex disability claims.
    I am accompanied by Ms. Edna MacDonald, Director of the 
Nashville Regional Office.
    The Veterans Benefits Administration (VBA) continues to 
experience an increase in the number and complexity of medical 
issues in disability claims received. Between 2011 and 2013, 
the average number of issues in original claims for service 
connected disability compensation increased by 31 percent, from 
5.5 issues in 2011 to 7.2 issues in 2013. In response to this 
trend and to achieve the Secretary's goal of processing all 
claims within 125 days at 98 percent accuracy in 2015, VBA 
developed and implemented a new operating model that includes a 
formal mechanism to manage complex claims. My testimony will 
explain why certain claims are more complex than others and how 
VBA has improved our policies and procedures to provide more 
timely and accurate decisions to Veterans with complex claims.

Backlog Update

    Before discussing the topic of today's hearing, I would 
like to provide the Subcommittee with an update on our progress 
to date in eliminating the claims backlog. VA has 
significantlyreduced the backlog by approximately
    34 percent, or approximately 210,000 claims since March 
2013, and we expect the reductions to continue in upcoming 
months. Further, we continue to execute our claims 
Transformation Plan.
    More importantly, while increasing our productivity we have 
concurrently increased the quality of our work. In June 2011, 
our average for claims accuracy was approximately 83 percent; 
in August of 2013 that number was approximately 91 percent. 
When measuring accuracy at the medical issue level - which is a 
truer measure of VA's workload - our rating accuracy today 
stands at 96.1 percent.
    The current inventory of claims, backlog, and other 
workload measures for both the national level and at the 
regional office level are available by visiting http://
www.vba.va.gov/reports/. The Monday Morning Reports provide 
workload indicators reported by VBA regional offices and are 
updated weekly. Similarly, the ASPIRE Dashboard provides 
monthly information on how VBA and regional offices are doing 
in relation to 2015 aspirational goals.
    None of this progress would be possible without the 
tremendous support VA receives from its partners including this 
Subcommittee, the rest of Congress, our Veterans Service 
Organizations, and County and State Departments of Veterans 
Affairs. Our progress is also the result of unprecedented 
effort and dedication of VBA employees, 52 percent of whom are 
Veterans themselves, and the support provided by our partners 
in VA's Office of Information and Technology and Veterans 
Health Administration. Veterans themselves have contributed to 
our progress by participating in the Fully Developed Claims 
program and submitting claims electronically through the 
eBenefits Web site. We appreciate the support of all of our 
partners and stakeholders as we continue working to eliminate 
the claims backlog.

Complexity of Claims

    From 2009 to 2013, the average number of issues included in 
a disability claim increased from 2.8 to 4.9. In particular, 
VBA has noticed an increase in complexity of the claims from 
the newer generation of Veterans who participated in Operation 
Enduring Freedom, Operation Iraqi Freedom, and Operation New 
Dawn. These young heroes have a greater chance of surviving 
serious injuries and often return home with multiple 
amputations, blindness, burns,
    multi-organ system damage, and most notably, with the 
signature wounds of the war--traumatic brain injury (TBI) and 
posttraumatic stress disorder (PTSD).
    In addition, VBA continues to receive complex claims from 
Veterans of the Vietnam Era, who submit more claims than 
Veterans from any other period of service. Many claims from 
Vietnam Era Veterans are also complicated because they are 
subject to Federal court orders in Nehmer v. U.S. Dep't of 
Veterans Affairs under which, when VA adds a new presumptive 
condition to the list of those conditions associated with 
exposure to herbicides used in Vietnam or modifies the 
definition of a presumptive condition, it must re adjudicate 
the claims of Veterans or eligible Survivors who previously 
filed claims seeking benefits based on that condition, and in 
appropriate cases, pay benefits retroactively to the date of 
receipt of the denied claim. These court orders have added to 
the complexity of rating many claims from Vietnam Era Veterans.

VBA Organizational Model

    In response to the increasing complexity of claims and to 
achieve the Secretary's goal of processing all claims within 
125 days at 98 percent accuracy in 2015, VBA developed and 
implemented a new operating model by March 2013 that includes a 
formal mechanism to manage complex claims. Initially planned 
for deployment throughout fiscal year (FY) 2013, VBA 
accelerated implementation of its new organizational model by 9 
months due to early indications of its positive impact on 
performance.
    The new organizational model incorporates a case-management 
approach to claims processing by reorganizing the workforce 
into cross-functional teams so that employees see the entire 
processing cycle of a Veteran's claim. These cross-functional 
teams work together on one of three segmented lanes: express, 
special operations, or core. Lanes were created based on the 
complexity and priority of the claims, and employees are 
assigned to the lanes based on their experience and skill 
levels. An Intake Processing Center serves as a formalized 
triage process to quickly and accurately route Veterans' claims 
to the right lane when first received.
    The express lane was developed to identify those claims 
with a limited number of medical conditions (i.e., about 1-2 
issues) and subject matter which could be developed and rated 
more quickly. The special operations lane applies intense focus 
and case management on specific categories of claims that 
require special processing or training (e.g., homeless or 
terminally ill Veterans, military sexual trauma (MST), former 
Prisoners of War, seriously injured, etc.). These claims 
continue to receive priority processing. The core lane includes 
claims with three or more medical issues that do not involve 
special populations of Veterans.
    The special operations lane is comprised of a regional 
office's most highly skilled personnel with specialized 
experience and training. The quality of our decisions improves 
by assigning more experienced and skilled employees to the more 
complex claims in our special operations lane. When VA receives 
a complex claim, a comprehensive screener ensures that the 
claim is correctly identified and routed to the appropriate 
member of the special operations lane. Because of the expertise 
of the screener, the claim is carefully examined to determine 
the next action required. For example, cases that are fully 
developed and ready for a decision will be routed directly to 
an experienced rater who will fully evaluate the claim. If the 
case requires additional evidence to support the claim, the 
screener will forward the case to an employee who will take the 
appropriate development action. The team includes a supervisor 
and claims assistants who perform important clerical work. The 
keys to success within the special operations lane are 
communication, attention to detail, and accountability.

Calculators and Evaluation Builder

    VBA is also simplifying ratings by building new decision-
support tools within the Veterans Benefits Management System 
(VBMS) to make our employees more efficient and their decisions 
more consistent and accurate. We have already developed rules-
based calculators for disability claims decision-makers to 
provide suggested evaluations. For example, the hearing loss 
calculator automates decisions using objective audiology data 
and rules-based functionality to provide the decision-maker 
with a suggested decision.
    The Evaluation Builder is essentially an interactive 
disability rating schedule. The VBA decision-maker uses a 
series of check boxes that are associated with the Veteran's 
symptoms. Using the Evaluation Builder, the VBA employee 
determines the proper diagnostic code out of over 800 codes as 
well as the level of disability based on the Veteran's 
symptoms. The Veteran receives an accurate rating decision 
every time the Evaluation Builder is used. This saves employees 
time that would have been spent looking up the rating schedule 
in a paper format. To date, 10 of the 15 body systems in VA's 
Schedule of Rating Disabilities have been embedded into the 
Veterans Benefits Management System (VBMS).

Disability Benefits Questionnaires (DBQ)

    DBQs are another transformation initiative designed to 
simplify rating decisions. DBQs replace traditional VA 
examination reports and are designed to capture all the needed 
medical information relevant to a specific condition at once 
and up front so that claims can be developed and processed in a 
more timely and accurate manner, with the end result being 
faster service for Veterans. DBQs change the way medical 
evidence is collected, often giving Veterans the option of 
having their private physicians complete a DBQ that provides 
the medical information needed to rate their claims - 
minimizing the need for a VA exam which adds additional time to 
the claim development process.
    Information in the DBQs maps to the VA Schedule for Rating 
Disabilities, and provides all of the necessary information to 
decide a disability claim. Fully and properly completed DBQs, 
whether from private providers or within the internal VA 
examination processes, have the potential to reduce rework, the 
largest category being exams with insufficient information. 
VBA's future goal is to turn DBQ objective responses into data 
to drive a calculator-based
    business-rules engine in VBMS, to achieve automated 
decision support to improve consistency and accuracy of 
decisions, and reduce processing time per case.

Examples of Complex Claims

    Claims are considered complex for a variety of reasons. 
Three examples are outlined below along with our efforts to 
provide more timely and accurate decisions for such claims.

TBI

    Due to the complexities associated with rating TBI, the 
special operations lane processes claims from Veterans seeking 
compensation for TBI. Since March 2013, all raters in the 
special operations lane are required to complete specialized 
training on TBI. This Web-based TBI training module is a 22.5 
hour course on how to rate a claim for the residuals of TBI.
    Veterans who file claims for TBI receive a compensation and 
pension examination, which is designed to elicit all clinical 
findings attributable to TBI. However, due to the myriad of 
symptoms that a Veteran with TBI may experience, it is often 
unclear which symptoms are solely attributable to TBI. In 
October 2011, Compensation Service provided guidance that 
examination findings should be related to the Veteran's TBI 
condition, unless such symptoms are clearly attributable to 
other causes.
    In addition, VBA has instituted safeguards to ensure 
consistent and accurate ratings for TBI claims. All raters are 
required to obtain a second signature on TBI claims until the 
individual demonstrates 90-percent accuracy in rating TBI 
claims.
    As a result of these efforts, VBA has seen TBI grant rates 
increase from 21 percent in 2007 to 47 percent in 2013. 
Further, the accuracy of TBI ratings during quality reviews 
during FY 2013 was 92.37 percent, which was slightly higher 
than the national average for all rating claims during the same 
period.

PTSD

    Service connection for PTSD requires: 1) medical evidence 
diagnosing the condition; 2) a link, established by medical 
evidence, between current symptoms and an in-service stressor; 
and 3) credible supporting evidence that the claimed in-service 
stressor occurred. VA recognizes that certain in-service 
stressful events may be difficult to document.
    In 2010, Secretary Shinseki took action to make it easier 
for Veterans with PTSD based on fear of hostile military or 
terrorist activity to establish service connection. Under the 
generally applicable criteria for PTSD, VA requires 
corroborating evidence of occurrence of an in-service stressful 
event from such sources as military personnel records, service 
treatment records, lay statements from fellow Servicemembers, 
or military unit records provided by the Department of Defense 
to service-connect a Veteran's current PTSD symptoms. VA added 
a regulation providing that a Veterans' lay statements alone 
can now establish the required in-service stressor if it is 
related to fear of hostile military or terrorist activity and a 
VA psychiatrist or psychologist or psychiatrist or psychologist 
with whom VA has contracted, confirms that the claimed stressor 
is adequate to support a PTSD diagnosis, and that the Veteran's 
symptoms are related to the claimed stressor. VBA's 
Compensation Service provided extensive training on this 
regulatory amendment to ensure consistent and accurate ratings 
were made after this change. As a result of this liberalized 
stressor-verification standard, outreach, and other factors, 
the number of Veterans in receipt of compensation for PTSD 
increased from approximately 374,000 in FY 2009, to 649,000 in 
FY 2013.

PTSD Based on MST

    PTSD claims based on MST are one of the complex claims 
processed by our most experienced adjudicators in the special 
operations lane. Complications with these claims generally 
arise in situations where there is no corroborating evidence of 
the MST stressor in the Veteran's military records. Delays can 
occur because VA must obtain the complete personnel file and 
seek evidence from sources other than the Veteran's service 
records to corroborate the Veteran's account of the stressor 
incident. Additionally, VA must notify the Veteran that 
evidence from outside military records may be used to support 
the claim and must follow up and attempt to obtain any such 
evidence identified by the Veteran. These development issues 
add to the claims' complexity, but VA has taken steps to 
address them.
    VA is committed to serving our Nation's Veterans by 
accurately adjudicating claims based on MST in a thoughtful and 
caring manner, while fully recognizing the unique evidentiary 
considerations involved in such a claim. In 2011, VBA conducted 
a quality review of 400 MST-based PTSD claims, which found an 
approximate 25-percent error rate based primarily on incomplete 
development. To remedy this, we developed a MST-based PTSD 
training package and conducted a nationwide online training 
broadcast was conducted. The training emphasized proper 
evidence development and recognition of the types of evidence 
(such as erratic performance evaluations; sexually transmitted 
disease tests; requests for transfers; mental health 
counseling; behavior changes; and lay statements from fellow 
Servicemembers, family, or clergy) that can corroborate a 
Veteran's account of the stressor incident.
    The training also emphasized that when there is 
corroborating evidence, including evidence of a behavioral 
change, VBA must request a disability compensation examination 
that includes a medical opinion about whether the evidence of 
record indicates that a personal assault occurred. This medical 
opinion can provide a basis upon which service connection for 
PTSD can be established.
    Following the training, the MST-based PTSD grant rate rose 
to a level comparable to the level for all types of PTSD 
claims. In order to assist Veterans' whose claims were denied 
prior to the training initiative and who may benefit from 
additional evidence development for markers, we decided to 
conduct a review of previously denied MST-based PTSD claims, 
upon a Veteran's request. VBA identified approximately 2,500 
Veterans with previously denied MST-based PTSD claims and sent 
notice letters to the Veterans in April 2013. The letters 
invited the Veterans to request a review of the denied claims 
by their regional offices and to submit or identify any 
additional evidence to support their claims. Compensation 
Service updated the MST-based PTSD Training Letter to explain 
the review to regional office personnel. Additionally, VA's 
National Call Center has developed and implemented a question 
and answer script on how to answer questions on the review 
process.
    There has been one additional legal development in the 
adjudication of MST claims. On September 30, 2013, the United 
States Court of Appeals for the Federal Circuit ruled in AZ v. 
Shinseki that, where an alleged sexual assault is not reported, 
the absence of service records documenting the alleged assault 
is not pertinent evidence that the assault did not occur. The 
court reasoned that because the majority of in-service sexual 
assaults are not reported and records of unreported sexual 
assaults do not exist, the absence of a service record in such 
a case is not reliable evidence and cannot be considered by VA. 
This legal development is consistent with VBA's current 
policies and procedures as we do not make rating decisions 
based on the absence of a reported sexual assault in a service 
record.
    In FY 2013, the grant rate for MST-based PTSD was within 
six percentage points of the grant rates for all PTSD claims. 
The grant rate for male Veterans claiming MST-based PTSD is now 
within seven percentage points of the grant rate for female 
Veterans claiming MST-based PTSD. In FY 2013, there was only a 
two percentage point difference in the grant rate for all PTSD 
claims submitted by male and female Veterans.

Training and Accuracy

    VBA is committed to providing high quality, timely, and 
relevant training for both new and experienced personnel to 
ensure that claims-decision quality continues to improve. To 
this end, our transformation efforts include redesigned 
programs and tools that standardize training across our 56 
regional offices.
    In 2012, VBA created Quality Review Teams (QRT) to improve 
employee training and decision accuracy while decreasing rework 
time. We reassigned 573 of our most skilled and experienced 
employees from their duties as claims processors to serve on 
QRTs. In FY 2013, these QRTs conducted more than 145,000 in-
process reviews, preventing errors before they could impact 
Veterans and provided specialized retraining to claims 
processors so these errors can be prevented in the future.
    VA currently uses a 3-month rolling average to track the 
impact of initiatives on rating accuracy. These metrics are 
reported in ASPIRE and can be seen online by anyone inside or 
outside of VA. In FY 2012, VA showed a
    3-percent increase in national accuracy - from 
approximately 83 percent to
    86 percent. In FY 2013, our 3-month accuracy at the claims 
level rose to approximately 90 percent, meeting the goal we set 
for ourselves this year. The accuracy outcome goals for the 
next 2 years are approximately 93 percent in
    FY 2014, and 98 percent in FY 2015.
    It is important to recognize that under the existing 
quality review system, any one error on the claim, no matter 
how many medical conditions must be developed and evaluated, 
makes the entire claim in error - the claim is therefore 
counted as either 100 percent accurate or 100 percent in error, 
with no credit for anything in between. Medical issues are 
defined as individually evaluated medical conditions. Given 
that the average number of medical issues in original claims 
filed by recently separated Servicemembers is now above 10 
issues per claim, we do not believe the current all-or-nothing 
measure reflects the actual level of decision accuracy 
achieved. When we measure the quality of claims based on the 
individual medical issues rated (i.e., ``issue-based 
accuracy''), the accuracy of our decisions is at approximately 
96.1 percent. This issue-based accuracy approach also affords 
VBA the opportunity to precisely target those medical issues 
where we make the most errors, at the individual employee 
level, and develop and direct training in a targeted manner.

Conclusion

    VA has seen a significant increase in the complexity of 
claims received in recent years. To address this trend, VA has 
implemented a new organizational model with a special 
operations lane focusing on complex disability claims. We 
firmly believe this initiative, along with VBA's other 
transformational initiatives, will help VA eliminate the claims 
backlog and achieve the Secretary's goal of all claims 
completed in 125 days at 98 percent accuracy in 2015.
    This concludes my statement, Mr. Chairman. I would be happy 
to entertain any questions you or the other Members of the 
Subcommittee may have.
    Mr. Runyan. Thank you, Mr. Murphy. With that, I would 
recognize Ms. McCauley.

              ORAL STATEMENT OF SONDRA F. MCCAULEY

    Ms. McCauley. Mr. Chairman and Members of the Subcommittee, 
thank you for the opportunity to discuss our work regarding 
complex disability claims processing issues. With me today is 
Mr. Brent Arronte, Director of our San Diego Benefits 
Inspection Division.
    In addition to our nationwide audits, the OIG reports on 
individual VARO effectiveness in providing timely and accurate 
benefits and services to veterans. Of major concern, however, 
is continued VARO non-compliance with VBA policy despite our 
recommendations for addressing issues we identify.
    Specifically in response to our May, 2011 report, VBA began 
requiring second-signature reviews of all TBI claims until 
raters demonstrate 90 percent accuracy in TBI claims 
processing. However, in fiscal year 2013 we saw only slight 
improvement since our first cycle of inspections. Twelve VAROs 
remained non-compliant in processing TBI claims for two 
consecutive inspections. Half of the errors were due to VARO 
staff using inadequate medical exams to rate TBI claims.
    In January 2011, we projected VBA incorrectly processed 15 
percent of 100 percent disability evaluations for about 181,000 
veterans, and paid a net $943 million without adequate 
supporting medical evidence. VBA implemented training and 
internal controls to address this issue. However, VBA 
repeatedly delayed completing its review of all 100 percent 
disability evaluations to ensure each had a future examination 
date entered in the electronic record.
    Our second cycle of VARO inspections continued to show a 
high error rate in processing these evaluations. In most cases 
errors occurred when staff did not enter suspense diaries in 
VBA's electronic system to request medical reexaminations as 
required.
    We continue to review VBA's systematic analyses of 
operations (SAOs), an organized means of reviewing Veterans 
Service Center (VSC) operations to identify problems and 
propose corrective actions. We found six VAROs remained non-
compliant in this area for both cycles of our inspections.
    Generally VARO management did not provide adequate 
oversight to ensure SAOs were timely and/or complete. We noted 
a correlation between SAO non-compliance and VAROs having 
vacant or temporary director or VSC manager positions for five 
months or greater.
    Currently we are assessing VBA's initiatives to improve 
claims processing and eliminate the backlog. We are reviewing 
the initiative VBA began on April 19, 2013 to process within 60 
days all claims over two years old. Of note we determined ten 
of 11 provisional rating decisions at the Los Angeles VARO were 
non-compliant with VBA guidance. We found the VARO Director's 
office had emailed conflicting guidance to staff requiring 
provisional rating without supporting medical evidence. 
Concerned that additional errors may exist, we recommended that 
VBA review for accuracy all 470 provisional ratings completed 
by the Los Angeles VARO after the conflicting guidance was 
issued.
    Findings from our ongoing audit of the Veterans Benefits 
Management System (VBMS) suggest some progress. While VBA has 
reduced its inventory and average days to complete claims, we 
cannot determine if the improvements are related to VBMS or 
other transformation initiatives. Moreover, VBMS continues to 
experience performance issues and users rely on legacy systems 
to fully process claims. We have initiated a review to 
determine the extent to which VBMS helps VBA improve the 
accuracy and consistency of its claims rating decisions. We 
expect to report our findings in early 2014.
    In conclusion, VBA has made some progress but continues to 
face challenges to improving claims processing accuracy and 
timeliness. Inefficiencies mean not only added burdens and 
delays for veterans, but also improper payments that VBA will 
not likely recover. We will continue to look for ways to 
promote improvements in VBA benefits deliver during our future 
audits and inspections.
    Mr. Chairman, this concludes my statement. We would be 
pleased to answer any questions that you or other Members of 
the Subcommittee may have.

            PREPARED STATEMENT OF SONDRA F. MCCAULEY

    Mr. Chairman and Members of the Subcommittee, thank you for 
the opportunity to discuss issues related to the performance of 
Department of Veterans Affairs (VA) Regional Offices (VAROs) as 
identified in reports by the Office of Inspector General (OIG). 
The reports include audits of the programs and operations of 
the Veterans Benefits Administration (VBA) as well as 
inspections conducted at individual VAROs. I am accompanied by 
Mr. Brent Arronte, Director, OIG San Diego Benefits Inspection 
Division.

Background

    Delivering timely and accurate benefits and services to the 
millions of veterans who provided military service to our 
Nation is central to VA's mission. VBA is responsible for 
oversight of the nationwide network of regional offices that 
administer a range of veterans benefits programs, including 
compensation, pension, education, home loan guaranty, 
vocational rehabilitation and employment, and life insurance. 
These programs are estimated to pay out over $73 billion in 
claims to veterans and their beneficiaries in fiscal year (FY) 
2014, and comprise approximately half of VA's total budget.
    As part of our oversight responsibility, we conduct 
inspections of VAROs on a 3-year cycle to examine the accuracy 
of claims processing and the management of Veterans Service 
Center (VSC) operational activities. After completion of our 
inspections, we issue a separate report to each VARO Director 
on the inspection results. Our inspections address the 
processing of high-risk claims such as traumatic brain injury 
(TBI) and temporary 100 percent disability ratings. We 
previously reviewed claims related to post-traumatic stress 
disorder (PTSD), however due to a change in regulations as well 
as improved accuracy in processing PTSD claims, we discontinued 
our reviews of these claims in FY 2012.
    In FY 2012, we completed our first cycle of reviews of all 
VAROs and began our second cycle of oversight. To date, we have 
completed 20 VAROs in our second cycle of reviews.1 We are also 
performing separate reviews focused on two of VBA's major 
initiatives related to electronic processing of claims through 
the Veterans Benefits Management System (VBMS) and provisional 
decisions on claims over 2 years old.

VA Regional Office Inspections

    Since FY 2009, we have conducted 77 VARO inspections and 
have consistently reported the need for enhanced policy 
guidance, oversight, workload management, training, and 
supervisory review to improve the timeliness and accuracy of 
disability claims processing and VARO operations.2 Of those 
offices that have been inspected twice, the Denver and 
Milwaukee VARO inspections had the highest (80 percent) level 
of overall compliance with VBA policy in the areas that we 
inspected.3 The Baltimore VARO had the lowest compliance rate 
in areas we inspected. .
    An area of concern from an oversight perspective is 
continued VARO non-compliance with VBA policy despite our 
initial identification and reports on such problems. In FY 
2013, we inspected 20 offices that we previously inspected and 
found 17 of the offices continued to be non-compliant with VBA 
policy in one or more of the protocol areas previously 
inspected.

Disability Claims Processing

    In the second round of inspections, we are focusing on 
processing high-risk claims, TBI claims and temporary 100 
percent evaluations. We adjust our inspection protocols as 
needed, with some review areas continuing year-to-year while 
others are replaced because VAROs have demonstrated 
improvements in performance of those review areas or in some 
cases, changes in VBA policy.4

Traumatic Brain Injury Claims

    In response to a recommendation in our May 2011 report, 
Systemic Issues Reported During Inspections at VA Regional 
Offices, VBA agreed to develop and implement a strategy for 
ensuring the accuracy of TBI claims decisions. The then-Acting 
Under Secretary for Benefits responded by providing guidance to 
VARO Directors to implement a policy requiring a second 
signature on each TBI case that a Rating Veterans Service 
Representative (RVSR) evaluates until the RVSR demonstrates 90 
percent accuracy in TBI claims processing. The policy indicates 
second-signature reviewers come from the same pool of staff as 
those used to conduct local station quality reviews. Yet, we 
continue to identify significant processing errors related to 
TBI disability claims in our most recent inspections, and in 
many cases, the errors occur despite secondary reviews.
    Our 77 inspections to date showed that staff had made 
errors in 31 percent of the TBI claims we reviewed. More than 
half of the errors we identified were due to VARO staff using 
inadequate medical examination reports to evaluate residual 
disabilities associated with traumatic brain injuries. We 
learned through interviews that RVSRs were not consistently 
returning the inadequate reports to VA medical facilities as 
required due to pressure to meet production requirements. A 
common scenario in TBI claims processing involved veterans who 
had TBI-residual disabilities as well as co-existing mental 
conditions. When medical professionals did not ascribe the 
veterans' overlapping symptoms to one condition or another 
condition as required, VARO staff could not make accurate 
disability determinations. RVSRs' difficulty in following 
complex TBI claims evaluation policies is contributing to the 
TBI claims processing errors.
    In the first inspection cycle, we reviewed 1,077 traumatic 
brain injury claims at 57 offices and found 338 (31 percent) of 
these contained processing errors. In FY 2013, during 
subsequent inspections at 20 offices, we examined 411 claims 
and found 118 (29 percent) of these cases had errors--
demonstrating some improvement in the error rate percentages. 
Twelve of the offices inspected were non-compliant with VBA 
policy for two consecutive inspections.5 In most cases, the 
errors occurred because VARO staff used inadequate medical 
examination reports to evaluate residual disabilities 
associated with traumatic brain injuries.

Temporary 100 Percent Disability Evaluations

    In our January 2011 audit report, we projected VBA had not 
correctly processed 100 percent evaluations for about 27,500 
(15 percent) of 181,000 veterans.6 We reported that since 
January 1993, VBA had paid veterans a net $943 million without 
adequate medical evidence to support the payments. We concluded 
that if VBA did not take timely corrective action, it could 
overpay veterans a projected $1.1 billion over the next 5 
years. The Under Secretary for Benefits agreed with our seven 
report recommendations for implementing training and internal 
control mechanisms to improve timeliness in processing these 
types of claims. To date, VBA has implemented six of the seven 
recommendations.
    However, of major concern is VBA's delay in implementing 
the final recommendation, to review all temporary 100 percent 
disability evaluations and ensure each had a future examination 
date entered in the electronic record... The Acting Under 
Secretary stated the target completion date for VBA's national 
review would be September 30, 2011. However, VBA did not 
provide each VARO with a list of 100 percent disability 
evaluations for review until September 2011. VBA subsequently 
extended the national review deadline on four occasions. To 
date, VBA has not completed this national review requirement 
and improper monthly benefits continue to be paid despite a 
lack of adequate medical evidence.
    Although VBA has requested we close the final 
recommendation on several occasions, we have not been able to 
substantiate that VBA's methodology for identifying all claims 
that may be paying inaccurate benefits is effective. Further, 
VBA's methodology does not call into question a veteran's 100 
percent disability evaluation if there is also an associated 
control referred to as an ``end product'' to alert VBA claims 
processing staff of the need to review the claim at a later 
date. Having a control in place is not providing adequate 
assurance that the reviews will occur or that reviews will be 
timely. VBA designated the use of end product 684s as the 
control to ensure staff review 100 percent disability 
evaluations to determine if the monthly payments are accurate. 
However, VBA does not have performance metrics in place for end 
product 684s establishing a timeframe in which staff are 
expected to review and take corrective actions on pending end 
product 684s. As of November 19, 2013, VBA had 7,562 end 
product 684s pending on average for 340 days showing delayed 
corrective actions to identify and discontinue potential 
improper payments.
    We continue to follow up on these audit results during our 
VARO inspections and continue to find significant processing 
errors. Inspection results from 71 benefits inspections show 
VARO staff incorrectly processed 61 percent of the temporary 
100 percent disability evaluations we reviewed, resulting in 
over $19 million in overpayments to veterans. The majority of 
these errors occurred when VARO staff did not input reminder 
notifications in VBA's electronic system to request 
reexaminations of these veterans as required by VBA policy.
    For the first inspection cycle, we reviewed 1,480 temporary 
100 percent disability evaluations at 51 offices and found 973 
(66 percent) of these contained processing errors. In FY 2013, 
during subsequent inspections, we examined 594 claims and found 
290 (49 percent) of these cases had errors. Twelve of the 
offices inspected during FY 2013 were non-compliant with VBA 
policy for two consecutive inspections.7 In most cases and for 
both inspection cycles, the errors occurred because staff did 
not enter reminder notifications in VBA's electronic system to 
request re-examinations for veterans with temporary disability 
evaluations as required. We did identify improvement in this 
area in our 2013 inspections; however, in our view the error 
rates continue to be significant.

Post-Traumatic Stress Disorder

    When we began our VARO inspections, we included PTSD claims 
processing as a review area. In our summary report dated May 
2011, we projected VARO staff did not correctly process 1,350 
(8 percent) of approximately 16,000 PTSD claims completed from 
April 2009 through July 2010. About 38 percent of the errors 
were due to staff improperly verifying veterans' alleged 
stressful events, a requirement for granting service connection 
for PTSD. VARO staff lacked sufficient experience and training 
to process these claims accurately. Additionally, some VAROs 
were not conducting monthly quality assurance reviews. For 
these reasons, veterans did not always receive accurate 
benefits.
    Effective July 13, 2010, VA amended its rule for processing 
PTSD disability compensation claims. The new rule allows VARO 
staff to rely on a veteran's testimony alone to establish a 
stressor related to fear of hostile military or terrorist 
activity, as long as the claimed stressor is consistent with 
the circumstances of service. This change significantly reduced 
processing errors associated with PTSD claims. Prior to the 
rule change, we identified a 13 percent error rate in PTSD 
claims processing; after the rule change the error rated 
dropped to 5 percent. As such, we no longer review these types 
of claims.

Operational Issues

    One area that we continue to review is VBA's Systemic 
Analysis of Operations (SAOs). An SAO is an organized means of 
reviewing VSC operations to identify existing or potential 
problems and propose corrective actions. During the first 
inspection cycle, we identified 30 of the 56 offices inspected 
were non-compliant with VBA policy. In FY 2013, during 
subsequent inspections at 20 offices, 9 of the offices 
inspected were non-compliant--of these 6 were non-compliant for 
two consecutive inspections.8 Generally, SAOs were untimely 
and/or incomplete because VARO management did not have adequate 
oversight to ensure SAOs addressed all necessary elements and 
operations of the VSC and that they were submitted by the 
required due date.
    Another area of concern is VBA management vacancies. We 
noted a correlation between VAROs producing complete and timely 
SAOs and VSC compliance with other VBA policies. We found that 
five VAROs, where managers ensured SAOs were timely and 
complete, were the most compliant in other operational 
activities we inspected. Conversely, of the six VAROs that had 
untimely and/or incomplete SAOs, five had the lowest 
performance in other operational activities, such as claims 
processing, mail handling, and data integrity. At five of the 
six least compliant VAROs, vacancies in senior management 
positions contributed to delays in completing SAOs and 
implementing corrective actions. These VAROs had Director or 
Veteran Service Center Manager positions vacant or filled with 
temporary staff for periods of 5 months or greater. For 
example, during the 8-month absence of the Anchorage Veterans 
Service Center Manager, that office did not have any senior 
leadership physically in place to manage and oversee 
operations.

Current OIG Work On VBA Initiatives

    We are assessing VBA transformation initiatives to improve 
claims processing and eliminate the backlog. Specifically, we 
are conducting reviews of two key VBA initiatives: processing 
of claims over 2 years old and implementation and accuracy of 
the Veterans Benefits Management System (VBMS)--VBA's web-
based, paperless claims processing solution to support improved 
business processes.

Claims Processing Initiative: Rating Claims Pending Over 2-
Years

    On April 19, 2013, VBA implemented a special initiative to 
address the oldest pending disability claims in the current 
backlog. VBA stated the intent of the initiative was to work 
all claims pending for more than 2 years within 60 days, 
beginning April 19, 2013. VAROs were directed to devote all 
RVSRs and as many Veterans Service Representatives as needed to 
ensure all claims pending over 2-year old were processed and 
completed. According to VBA, RVSRs were to immediately process 
the 2-year old claims based on the available evidence in the 
veterans' claims folders. Further, rating decisions produced 
were to be considered provisional ratings unless all evidence 
in support of the claims had already been received (and the 
claim was considered ready-to-rate) or the ratings assigned 
provided the highest evaluation for the particular diagnostic 
code for each claimed issue. However, if medical examination 
reports or other Federal records were needed, these older 
claims could not be processed as provisional rating decisions.
    During one review errors were identified at the Los Angeles 
VARO when leadership provided conflicting guidance on the 
proper procedures for processing provisional rating decisions. 
We determined 10 (91 percent) of 11 provisional rating 
decisions we reviewed were not compliant with VBA's guidance 
related to the 2-year claims processing initiative. Eight of 
the 10 provisional decisions were determined to be non-
compliant because the rating decisions were made without 
supporting VA medical examinations as required. One claim was 
decided without Service Treatment Records, which are considered 
Federal records and must be obtained by VARO staff prior to 
rendering a provisional rating decision. In the remaining case, 
the provisional rating was controlled by a future diary that 
scheduled the claim for review in 2 years instead of 1 year as 
required.
    Requiring a rating decision to be rendered before a medical 
examination is obtained as a basis for a decision is in 
conflict with VBA policy. On May 14, 2013, conflicting guidance 
was sent to the Los Angeles VARO staff via an e-mail from the 
VARO Director's office. The guidance incorrectly stated all 2-
year old cases requiring a medical examination must have the 
medical examinations ordered by May 15, 2013. This conflicts 
with VBA guidance because if a medical examination was required 
to decide a claim, the claim could not be completed as a 
provisional decision until staff obtained the necessary medical 
examinations. The guidance also incorrectly indicated that any 
claims with medical examinations not completed by June 3, 2013, 
were to be decided by a provisional rating.
    We are concerned similar errors may exist among other 
provisional rating decisions completed by the Los Angeles VARO 
after the conflicting guidance was issued. VBA provided data 
that revealed the Los Angeles VARO completed 532 provisional 
rating decisions between April 19-June 19, 2013. VARO staff 
completed 470 of those 532 provisional decisions claims after 
the conflicting guidance was disseminated on May 14, 2013. All 
10 provisional rating decisions that we identified as non-
compliant were completed after this date. We recommended that 
VBA review all of the provisional rating decisions completed by 
the Los Angeles VARO after the conflicting guidance was issued 
to ensure they are accurate.

Veterans Benefits Management System (VBMS)

    VBA and VA's Office of Information and Technology (OI&T) 
are jointly developing VBMS, which is a web-based paperless 
claims processing system. As one of VBA's main transformational 
initiatives, VBMS is designed to assist VA in eliminating the 
claims backlog and serve as the enabling technology for 
quicker, more accurate, and integrated claims processing in the 
future.
    Over the past several years, the OIG has repeatedly 
reported deficiencies concerning the development, testing, and 
deployment of major systems throughout the department. In 
February 2013, we reported that because of system complexities 
and the incremental software development approach VA chose, 
VBMS had not been fully developed to the extent that its 
capability to process claims from initial application through 
review, rating, and award, to benefits delivery could be 
sufficiently evaluated.9 Thus we concluded that, as of 
September 2012, VA had not fully tested VBMS.
    In February 2013, the OIG launched a follow-up audit of 
VBMS to determine whether VA is effectively managing VBMS 
development and whether the project is positioned to meet 
schedule, costs, and performance goals. We expect to complete 
our audit in March 2014. Currently, VBMS has one pilot site 
that provides the capability to process claims from initial 
application through review, rating, award, to benefits 
delivery. VBMS also continues to suffer from system performance 
issues forcing users to rely on legacy systems to process 
claims.
    In June 2013, VBA completed its implementation strategy to 
install VBMS at all VAROs. After the rollout of VBMS, VBA's 
inventory of pending claims was just under 797,000 and took an 
average of 238 days to complete. By the end of FY 2013, VBA had 
reduced its inventory of pending claims by 10 percent and 
reduced the average days to complete by 58 days. We cannot 
determine if the reduction in the pending inventory or the 
improvement in claims processing timeliness is related to VBMS 
or to one of VBA's many improvement initiatives.
    In our recent inspections of the Houston, Newark, and 
Milwaukee VAROs, 25 staff provided us a user perspective of 
VBMS. Generally, staff expressed frustration with the system in 
part because of spontaneous system shut-downs, latency issues 
related to slow times to download documents such as medical 
evidence for review, longer times to review electronic 
evidence, mislabeled electronic evidence, and mixing evidence 
from one veteran's electronic file with another veteran's.
    Given concerns raised at VAROs and complaints received 
through the OIG Hotline, we initiated a review of the accuracy 
of rating decisions completed using VBMS. We want to determine 
if the automation initiative will be effective in assisting VBA 
in meeting its goal of eliminating the disability claims 
backlog and improving the accuracy and consistency of rating 
decisions. We expect to report on our findings in early 2014.

Conclusion

    VBA continues to face challenges in improving the accuracy 
and timeliness of disability claims decisions and maintaining 
efficient VARO operations. Our inspections and audit work 
consistently has shown that VAROs do not always comply with 
VBA's national policy to accomplish their benefits delivery 
mission. Claims processing and operational problems result in 
not only added burdens and delayed or incorrect payments to 
veterans, they also mean wasted Government funds through 
improper payments that VBA will not likely recover. While VBA 
made some incremental progress through its own initiatives and 
in response to our prior report recommendations, more work 
remains to be done. We will continue to look for ways to 
promote improvements in benefits delivery operations during our 
future nationwide audits and VARO inspections.
    Mr. Chairman, this concludes my statement. We would be 
pleased to answer any questions that you or other Members of 
the Committee may have.
    Mr. Runyan. Thank you, Ms. McCauley. And I will begin a 
round of questions with myself. And the first question probably 
for Mr. Murphy, and Ms. McCauley I will have you both kind of 
touch on it. And it precisely touches on one word here: 
accuracy. Mr. Murphy, VA uses the term accuracy frequently. 
Today we have heard from veterans, representatives of veterans, 
VSOs, and VA Office of the Inspector General, who indicated 
that claims are not being correctly decided at a very high 
incidence. The files lack proper development and the medical 
examinations are not adequate. VA OIG added that our VSRs are 
not consistently returning adequate medical reports to VA 
facilities as required due to pressure to meet production 
requirements.
    In a moment I would like you to explain in detail how VA 
calculates and represents a 91 claims-based accuracy. I find 
VA's representations of accuracy to be even more concerning 
when you state that VA's TBI accuracy to be over 92 percent. VA 
OIG, who is specifically tasked to perform quality reviews of 
TBI claims, reports that over 30 percent of cases nationally, 
employees are not compliant with VBA policy, with individual 
ROs showing error rates as high as 50 percent.
    So here is the question. Does accurate by VA standards mean 
that the veteran received the correct rating decision for the 
claimed conditions upon full and proper development of the 
claim? And if accurate indicates anything less than this, what 
does it mean?
    Mr. Murphy. Accuracy means exactly what you said, Mr. 
Chairman. Did the veteran receive the proper benefit 
entitlement payment or decision in the case of a denial? That 
is the measure of accuracy conducted by our quality analysis 
staff in Nashville and reported out. That is what the 91 
percent means. That number is drawn from a true statistically 
valid nationwide sample, random sample, applied to all regional 
offices, collected into Nashville each month, evaluated, 
returned to the regional office, and then summed up on a 
rolling 12-month average.
    Mr. Runyan. Why do we have a discrepancy with the OIG 
numbers then?
    Mr. Murphy. The IG and VBA do not measure what an error is 
exactly the same way. I look at an error as did the benefit 
entitlement be wrong, number one? And the IG tends to look at 
it from the standpoint of did you follow the process? If you 
varied from the process but you got the benefit entitlement 
decision right, I will not call that one an error. However, the 
IG will.
    But there is something more important that you need to hear 
and it is a quote from the IG report which says, ``We sample 
claims we consider at higher risk of processing errors. Thus 
these results do not represent the overall accuracy of 
disability claims processing at this VA regional office.'' This 
is the page from the title of the IG report. There is one of 
these in each report.
    My point is this: the IG by design targets a specific 
subset of known high errors. If you take that number and 
extrapolate it out to, say, the entire regional offices this 
way, it is not an accurate representation of the sum of work 
for that regional office. I am not disputing that is an 
accurate representation for the subset that they looked at. But 
not for the totality of work that comes out of the regional 
office.
    Mr. Runyan. No, but I am having the discussion, but we also 
broke it down to just TBI cases and your numbers conflict 
there.
    Mr. Murphy. Yes, our numbers conflict there. The IG's 
reports that you are looking at here are a sum of several years 
worth of work. The numbers I am giving you are a sum of the 
last 90 days worth of work. My point is this. When you look at 
current, where we were and where we are, the IG report is much 
more reflective of where we were, not necessarily where we are 
sitting right now today.
    Mr. Runyan. Ms. McCauley, can you respond to that?
    Ms. McCauley. Yes. The numbers for TBI that we reported 
they are 31 percent error rate, that was based on our first 
round of inspections from 2009 to 2012. More recently we found 
a 29 percent error rate and that was for our fiscal year 2013 
inspections. As Mr. Murphy, suggested we do look at specific 
high-risk type of claims. And so we are not looking across all 
the different kinds of claims to come up with an accuracy rate, 
but rather to focus in on those such as TBI or temporary 100 
percent disability evaluations that have shown repeatedly to 
have a high error rate.
    Also, there is a big difference in terms of how we call 
errors and how VBA calls errors. We do not focus just on the 
benefits entitlements amounts. When we look at the claims, we 
look at the processing of the claim, human error, system error, 
processing error, did they follow regulations--all of that goes 
into the accuracy of a claim. Sometimes the benefits 
entitlement might be correct for the moment, but sometimes 
there are errors that are made that could have potential impact 
on benefits down the road, future benefits for the veteran. So 
we look at the totality of the claims processing exercise.
    Mr. Runyan. One more question. Talking about how you 
compile statistics, does the VA keep track of accuracy an 
appeal rate by the number of years of experience by the RVSR or 
the DRO?
    Mr. Murphy. Accurate from the standpoint of I can go back 
to my office and give you a report that says this, no I do not 
report it out that way on a routine basis. However, in 
determining the training that we are doing, the types of 
training that we are doing, where we are spending our effort, 
where the errors, the high concentration of errors are, I use 
that data every single day to determine exactly what training I 
need to be doing, where I need to be concentrating it, even 
down to the regional office level. And by tracking and looking 
at errors at an issued based level, which we started doing more 
than a year ago at this point, I now have the ability to go in 
and say TBI is a high error rate in a particular regional 
office and target just the raters that work TBI, as an example.
    So to give you back to the office and give you a report and 
say here it is, no, I do not track it that way. However, in all 
of our training process and everything else that we do, that 
information is considered on a regular basis.
    Mr. Runyan. But what I, where my head is on this is is it 
because of a lack of experience at some level? It came up in 
the last panel, that maybe we do not even have enough people 
with the experience to be able to rate these things. Is that 
trackable in your statistics?
    Mr. Murphy. Let me go back to your first question, Mr. 
Chairman. This is an excerpt from the Waco report. It talks 
about traumatic brain injury, reviewed 30 cases. Cases in error 
that affect veterans' benefits: zero. Potential to affect 
veterans' benefits, the difference of rules between how the IG 
looks at it and how I look at it, is eight out of 30. There is 
the 30 percent error rate that you are talking about. Did the 
veteran receive the right check based on what they had? Yes. 
Was there maybe a process that was done different but they got 
the right benefit entitlement check? Yes. An error in the IG's 
eyes, but when you look at that from the veteran focus that was 
the right decision and the right compensation was received by 
that veteran.
    Mr. Runyan. We always have, what I am just trying to ask is 
it possible to find the analysis of does someone that has more 
experience in, say a certain regional office has more 
experienced personnel in it, are you getting a better outcome 
there?
    Mr. Murphy. Are we getting a better output in the----
    Mr. Runyan. With experience----
    Mr. Murphy. Yes.
    Mr. Runyan. --of the claim adjudicator?
    Mr. Murphy. Yes, you are. No question.
    Mr. Runyan. You track that?
    Mr. Murphy. We track that. In fact, we did a what we call a 
consistency study the first week of August. And we broke it 
down with six questions that were sent out to all people. This 
one happened to be on, I think it was diabetes, yes. And what 
we did is we broke it down by lanes, we broke it down for the 
quality review teams for the STARS staff, and I laid all of the 
different segmented populations of work lanes. And by a long 
shot, meaning in the mid to high 90 percent range, the special 
operations lane got those questions right at a much higher 
percentage, at the 93 or 94 percent rate, where the average for 
the total population was in the mid-eighties. The point being 
that the higher experience level, the better education, the 
more training that we are doing with those individuals, is 
yielding better results, more consistent results of higher 
quality. At the same time we are concentrating those more 
trained, more experienced people on the most complex conditions 
that we are dealing with.
    Mr. Runyan. If at all possible I would like to have staff 
be able to reach out to you and maybe take a look at those 
numbers?
    Mr. Murphy. Yes, sir. I would be happy to provide that.
    Mr. Runyan. I appreciate that. And I recognize the Ranking 
Member Ms. Titus.
    Ms. Titus. Thank you, Mr. Chairman. I would like to look at 
those numbers, too, if we can get them back, try to get some 
sense of or some order to them.
    Mr. Murphy, I have been talking about pay as you rate a 
good bit today because I think it fits in with this notion of 
the three different lanes and how to deal with complex cases. 
And we know that the VA has the authority to do pay as you 
rate. And I wonder if you would talk about that? Talk about 
what the problems are, of why you do not use it more often. And 
is the problem of how VA compensates the people who make these 
decisions based on a full claim decided, or a part claim, 
something we can address? That is, the concerns that were 
brought up in the previous panel about it.
    Mr. Murphy. The previous panel brought up comments about 
you did not get work credit for it so it was not work.
    Ms. Titus. Right.
    Mr. Murphy. Without going down and saying yes, that is 
right, no that is not right, let us take that as a base to talk 
about what we are putting in place actively right now. Which is 
exactly what you are describing. I receive a claim from a 
veteran that has got ten issues on it. I need to break that 
down into ten issues, and have maybe one rater rate ten, maybe 
have ten raters rate one each. But the point is this. Break it 
down into ten individual issues. Make rating decisions on those 
ten individual issues. And compensate the veteran if they are 
entitled to it as those rating decisions become, as they are 
made. And we move forward to do the other.
    The problem with that is in the system we are working with 
right now today, that is very difficult to do. And there are 
some barriers in terms of it is much less efficient in the 
amount of time that it takes our overall process to rate ten 
individual issues at one each. The fixes that we are putting in 
place will allow that to go significantly faster. And then our 
intent is to do exactly that, which is rate by issue.
    And so we understand what is in your bill. We have 
testified on that previously, that we agreed with that bill in 
concept. But at this point in time there were some 
complications due to our system limitations.
    Ms. Titus. Well when do you anticipate that those changes 
will be made?
    Mr. Murphy. I cannot put an exact date on it for you. But 
what I can tell you is every 90 days we do a new release at 
VBMS and I am not sure which one of those releases that some of 
these changes are in. One of the changes that is going in that 
is being piloted right now in one regional office is the VBMSA, 
or authorization module. And we need that in place in order to 
help these individual issues as they are decided to move 
through the system quicker. In other words, when I have the 
VBMS authorization module in place I will be able to process 
these individual issues without impacting the total system 
time.
    Ms. Titus. And will there be safeguards in place so that 
you do not just pay a veteran off for a few things and think he 
will go away, as opposed to really completing the entire claim?
    Mr. Murphy. Yes. We are looking at breaking this down so 
that it comes in as a single claim but it is posed in our 
system and we track it as though there are ten individual 
claims. So this is not just a, I am going to receive a claim 
and then I am going to break it up and process by issues. This 
is a true issue-based tracking, issue-based reporting, issued-
based quality, everything.
    Ms. Titus. I know that some of the cases that are in the 
Reno office have been farmed out to other offices where they 
can be moved faster. If you start breaking a claim down so that 
some of the things are easy and some are more complex end up in 
different lanes, you are not going to end up in two different 
places, are you for your claim to be completely considered?
    Mr. Murphy. Well depending on Mr. Michaud's question just a 
little while ago about Centers of Excellence, we certainly need 
to consider whether those two issues that are in two different 
lanes even need to be in the same regional office. Why if we go 
with the concept of Centers of Excellence, and Detroit happens 
to be on issue number one and St. Petersburg issue number two, 
why would we not send that claim? Because it is seamless now 
once I have it in the electronic environment. I can move them 
around the country by just a few keystrokes. So we still do not 
have the final this is exactly how it is going to be, but we 
are exploring the options from how do I get it through our 
system right and fast?
    Ms. Titus. We just don't want to make it more difficult for 
our veterans to be able to track where their claim is or 
understand what's happening with it and when it's happening 
without scattering it around or making it more complicated.
    Mr. Murphy. Yes. And you're seeing that. You are--one of 
the information points I'm sure you're interested in is the 
number of cases you currently have broken up from the regional 
office. It's under ----
    Ms. Titus. That's right. And we're waiting for some of 
those answers.
    Mr. Murphy. It's just under 700 right now. And it's--you've 
heard what we are doing with the two-year-old claim and the 
one-year-old claim and now moving to the 334 days. If the 
capacity of the regional office isn't in place in order to meet 
the time lines that we're putting in to meet these different 
deliverables on the oldest claims, we're shipping them off to 
other regional offices.
    In other words, we're making the oldest claim issue a 
national problem, and not one tied to a particular regional 
office. It just so happens that in Reno today, they happen to 
have a large number of the older claims, so we've sent those to 
other regional offices that have capacity to get those veterans 
done in a timely manner.
    Ms. Titus. Thank you.
    Mr. Runyan. Thank you, gentle lady. And I'll recognize Mr. 
Michaud.
    Mr. Michaud. Thank you, Mr. Chairman, and I want to thank 
this panel as well for your testimony today. Mr. Murphy, VBA 
currently adjudicates claims related to Camp Lejeune in 
Louisville, Kentucky, and claims related to radiation in 
Mobile, Alabama. Can you explain to the Committee why this is?
    Mr. Murphy. Well, those claims actually fall under the 
title of this hearing. They are complex claims. They are highly 
complex claims. And what we don't want to do is we don't want 
to have a veteran, because they went to Regional Office 1, get 
one decision--an equivalent case go to Regional Office 2 and 
get a different rating decision.
    So in order to do that, in order to concentrate our efforts 
and because of the way we were doing claims in the paper world, 
we concentrated them in single places. We provided special 
training for the processors and raters that worked the claims, 
and then at the same time, we went back and worked with VHA and 
provided training to the individual C&P examiners that would be 
working these particular types of conditions and then sent that 
back to a single, jointly trained rating board so we get a 
consistent, accurate output.
    So those two areas are specialized in those particular ----
    Mr. Michaud. Absolutely. Okay. For the OIG, Ms. McCauley, 
throughout your inspections on these difficult medical 
conditions, how often is training and a lack of knowledge 
regarding policies and procedures is a problem? How often is 
that?
    Ms. McCauley. It certainly has shown itself to be a problem 
as a result of our inspections. For example, in TBI, it's been 
said repeatedly today about the complexity of the policies for 
rating TBI claims. We did find that additional training was 
needed in the TBI area for the raters to be able to rate claims 
correctly, especially with regard to the issue of inadequate 
medical examinations--making sure they return them to the 
medical practitioners so that they get the adequate information 
they need to rate those claims.
    Mr. Michaud. Okay. In consideration of your response, do 
you think a veteran would benefit from having teams where 
specialty--that are specially trained and focused on complex 
conditions such as TBI, MST, and PTSD, similar to what we just 
heard Mr. Murphy mention about Camp Lejeune and radiation in 
Mobile, Alabama?
    Ms. McCauley. Well, we haven't examined the issue of the 
specialized claims, but certainly additional training would be 
a help in terms of adjudicating those claims.
    Mr. Michaud. So the better trained, the better specialized 
the workers are in the work that you have done, the more 
accurate they can and timeliness that they can process those 
particular claims?
    Ms. McCauley. We would expect that, yes.
    Mr. Michaud. All right. Thank you. Mr. Murphy, just to 
follow-up on my previous questions about Camp Lejeune and 
Mobile, Alabama where you specialize in those particular areas, 
one of the problems I've seen over time being on this Committee 
is--and particularly in some regional offices where the error 
rate is over, as you heard the Chairman, over 50 percent. When 
you look at the turnover rate in those areas, they might not be 
an employer of choice, and you're constantly training 
individuals, and particularly with our veterans coming back 
from Iraq and Afghanistan with TBI and PTSD and MST issues, I 
think it's important that with the new VBMS system, I like the 
idea when you're looking at the medical conditions, because 
with the medical conditions you can move that anywhere around 
the country in a timely fashion. So if there is a certain 
regional office that is specialized, such as Camp Lejeune in 
Louisville, Kentucky, to deal with those issues, that they can 
get an accurate decision in a timely manner.
    I understand some of the concerns that some of the VSOs 
might have that it's all not done in a regional office. Well, 
it's not done anyway when you look at a lot of the cases that 
are being brokered to other areas because they are not 
performing adequately. I would like to just, you know, see 
whether or not you would really consider looking at, you know, 
centers of excellence for those very complex cases since you 
can move it electronically once the VBMS system is up and 
completely running fully.
    Mr. Murphy. We would consider the centers of excellence 
concept. In fact, my staff is going through now, pulling 
numbers in terms of accuracy, rating capacity, et cetera, on 
regional offices right now to identify are there some clear 
outliers that say, this should be a COE for PTSD; this one 
should be for military sexual trauma; this one should be for 
TBI. So we're going through that process now. We're just 
beginning that process. It's not quick. It's going to take some 
time to do the--to make sure we get it right.
    But if there are some centers of excellence that are doing 
it right out there now, there's some lessons for it. Number one 
is, should I make them the center for all over the country, and 
number two, if the answer is, no, I should not, then what are 
they doing different to get it right that I need to teach the 
other regional offices? So either way it goes, this analysis 
that we're doing is going to yield good things for us.
    Back to the other part of your question which was the VSOs 
having some concern about them not being able to have that 
interaction and look at the file and review it. In the paper 
world that was a problem. In the electronic world with the 
stakeholder enterprise portal we have in place and the very 
shortly coming up releases which will allow them to see much 
more of the claim filed and the decision that is being made, 
they'll be able to perform that review from anywhere in the 
country, regardless of what regional office is working that 
file.
    Mr. Michaud. I appreciate that answer because for me, I 
think our number one priority should be making sure the veteran 
is taken care of, not whether or not that claim is processed in 
a regional office, particularly if that regional office is not 
performing the way it should be. So thank you very much. Thank 
you, Mr. Chairman.
    Mr. Runyan. Thank you, gentlemen, and I actually have 
another question. I know Mr. O'Rourke is going to come back. So 
Mr. Murphy, your testimony highlights that VBA has improved 
policies and procedures to ensure more timely and accurate 
decisions to veterans of complex claims.
    Setting aside the discussion we just had about strong 
concerns on how VBA calculates accuracy, VA's work towards 
better policy and procedure is welcome. But what the Committee 
is hearing from the IG is that a regional officer repeatedly 
failing to comply with the policies that are in place, to 
auditors, directors, and managers, this can be a theoretical 
exercise, but to the veteran who is underrated or denied 
because a regional office is not compliant, this is a complete 
failure. And as I read the American Legion's testimony, for 
those and its quote: ``For those veterans, VA's accuracy might 
as well be zero. The Inspector General consistently reports 
that the need for policy guidance, oversight training, and 
supervisory review, and yet 17 of 20 recently inspected offices 
remain or non-comply with VBA policies, most of which were 
found to be repeatedly out of compliance.''
    How are you going to enforce compliance or to put it 
another way, what will be the penalty for non-compliance?
    Mr. Murphy. I can't answer directly your question on what 
will be the penalty for non-compliance. That falls under the 
Office of Field Operation and Deputy Under Secretary Rubens. 
However, I can tell you what we're doing to ensure compliance 
is happening. And the solution is not going out yelling at 
regional offices' directors and telling them you must solve the 
process. The solution is for me to put a system in place which 
takes them down that path, and the right way becomes the path 
of least resistance.
    An example of how we're doing that today is, number one, I 
talked about how we changed the rules around PTSD, so we no 
longer had to go away and make a determination about the 
stressor and get a buddy statement saying, what happened? We 
changed the rules so that if the veteran came in and said I was 
in fear for my life, they served in a hostile environment, you 
order an exam and you assess them for PTSD. So that's the way 
we handle it from the rule side.
    When I look at it from the what system am I putting in 
place to ensure at a grassroots level, I got to take this back 
to the temporary 100 percent. And the example there is, in the 
system we've put in place with VBMS, you can no longer just hit 
a button and move through a screen. You're forced to stop and 
put a routine future exam date in place and place that item 
under control before the rater is allowed to press the button 
and move to the next screen. The point is, I forced the 
behavior without having to go out and push and discuss and come 
back and reexamine. I know that it's happening, because I can 
track it and I can see it on my system, and I pull a report 
every two weeks. And that every two-week report, last year I 
was seeing 600 cases. Now I'm seeing 50 cases.
    And the reason for that is, today there is somewhere in the 
neighborhood of 74, 75 percent of our cases are electronic 
through VBMS. We are still working through the last of the 
paper. So, as we move to the electronic environment, the 
compliance rate will go up and then I'll see that number drop 
over time.
    So the answer to your question is I fix it by putting 
procedures in place that drive the RO in the right direction, 
and I put system fixes in place that force the behavior that we 
need to have to ensure the veteran gets the right decision.
    Mr. Runyan. And before I yield to Mr. O'Rourke, I would 
remind you and remind everybody how many times Secretary 
Shinseki has sat there and talked about accountability, and how 
are we going to hold people accountable. And that's ultimately 
where we have to get to. You can do all the systematical stuff 
you want. If you're not motivating people to do it--I know they 
are highly motivated people; they want to do right by the 
veteran. But there's a lack of accountability there, and this 
is across the board. But, with that, I'll yield to Mr. 
O'Rourke.
    Mr. *O'Rourke.* Mr. Chair, thank you. I apologize for 
missing part of the second half of the hearing, and I'll get an 
update from those who are here about how you responded to some 
of the specific issues raised by Mr. Price and Ms. McNutt, and 
the veteran service organizations that were here. But so just 
briefly I'll bring up two issues. One is in El Paso at Fort 
Bliss, we have 1,800 IDES cases; 1,100 of those are backlogged 
at the DRAS site in Seattle. And so, just a plea from Colonel 
Hymel at William Beaumont from us in our office representing 
those soldiers. You know, whatever you can do to provide 
additional attention and focus on that so that we can get those 
folks through there.
    We have some associated problems with our Wounded Warrior 
transition unit there, and part of that is having these folks 
who are in this backlog disappear in the bureaucratic loop.
    The second one, you know, Ms. Price mentioned that she 
filed a fully developed claim and took us through every part of 
what she went through to do that. You know, we've been pushing 
for fully developed claims filed on-line. We think that through 
things like the Faster Filing Act and other initiatives that 
have come out of this Committee, we can cut the wait time, 
which in El Paso right now for a typical veteran is 450 days 
out of the Waco Regional Office down to something like 100 or 
less.
    So I want to just pick up on what Ms. Price said and I want 
you to address the concern that that raised with me and others, 
that there may be a problem will fully developed claims, and 
our ability to process them in a timely fashion and do so 
accurately.
    Mr. Murphy. Let me start with IDES. Yes, we understand 
exactly what you are talking about and with Fort Hood and 
Department of the Army----
    Mr. *O'Rourke.* Fort Bliss.
    Mr. Murphy. Fort Bliss. Sorry.
    Mr. *O'Rourke.* Yeah.
    Mr. Murphy. With Fort Bliss, and we put some definitive 
actions in place--that you'll see the numbers that are--that 
regional office, that DRAS site--start going in the right 
direction. First of which is in April, all of the employees at 
the Seattle D1BC--Day 1 Brokering Center. We shut down the Day 
1 Brokering Center and rolled it into the IDES site. What that 
does is it gives them immediate trained capacity to go in and 
start working IDES cases.
    Two, in May of 2013 we hired an additional 36 raters in 
that regional office. Now that sounds like, oh, they've been 
there since May, but the reality is they just started working 
last month, because they just completed challenge training and 
now they're in production, working in the DRAS, working cases.
    In May of 2013, Army Reserve personnel were activated and 
deployed in Seattle to help the DRAS site in getting these IDES 
cases through quicker. Staff at the regional office has been 
working mandatory overtime from mid-May to November of this 
year, and right after the holidays they will resume mandatory 
overtime through 2014, provided the funding is available to us.
    One other item that we've done with that is we had capacity 
in Providence to take some of those cases, because they were 
working faster. So 250 cases per month are being brokered to 
Providence in order to help take some of the pressure off of 
the DRAS site in Seattle. So I think in the coming months 
you're going to see drastic changes in there.
    One other comment about the IDES process in general. To 
look at the IDES process and say it's merely a simple claim is 
to call a complex--is really a complex claim is to call a 
complex claim a simple one. My point is this: these are the 
most complex of complex cases for veterans that are still 
serving. They take additional care. They take additional 
requirement, and they take joint cooperation between the VA and 
the Department of Defense. As a result, a timely claim going 
through the IDES process is measured at 295 days, not the 125 
days like we see for the traditional rating window.
    The second part was about Ms. Price and the FDC, and I 
guess I'm not sure exactly what it is that you are asking me 
there, Congressman.
    Mr. *O'Rourke.* Well, I guess the concern was--and I 
apologize again. I've missed almost everything that you've had 
to say in response to the stories that we heard earlier. So you 
may have already answered many of the concerns raised. But one 
of those among many that were raised was that Ms. Price, I 
believe before transitioning out, had already prepared and 
filed a fully developed claim and yet she had this incredibly 
arduous long battle to get that claim adjudicated in a 
satisfactory way. And so it causes concern for me and others 
when we're trying to direct veterans to file those fully 
developed claims on-line and we're telling them that they can 
get those claims resolved. And in some cases, and I think the 
majority of cases, close to 100 days versus the average pass of 
450 days, a story like Ms. Price's gives me some pause, and I 
just want to know whether that is truly exceptional, or whether 
there is more to that. And she seemed to indicate from other 
veterans that she had met with and assisted that she's seeing 
similar cases to hers.
    And so, just wanted to get your quick feedback on that, and 
again, if you've already answered it or you'd like to answer it 
in more detail at a follow-up meeting, I'd be happy to meet 
with you then. But if you could just quickly talk about how 
exceptional a case like that is.
    Mr. Murphy. I have to stay off discussing an individual 
veteran and that veteran's circumstances. But what I can tell 
you is this: based on the time frame that Ms. Price submitted 
her claim, 2009, when we were receiving fully developed claims 
at less than two percent, to today we are receiving 27 percent 
of those claims. They are going through with our highest 
priority and they're being tracked and monitored on a national 
basis at a national level.
    So my point is this: the experience that she saw is by no 
means typical of the process you are seeing today when the 
claims are going through in 115-120 days, through the fully 
developed claim process.
    Other things that have happened is in the very early stages 
of it we had a high rate of those claims that were entered into 
the fully developed claim process and for various reasons--
right, wrong, or otherwise--were removed from that process and 
put through the normal channel. We track and monitor that 
routinely now to make sure that a fully developed claim that 
comes in maintains its path through the fully developed claim 
process.
    There are specific rules that will pull that claim out of 
that process. But now that we've put these controlled measures 
in place, it's not being used or abused--it's not being used to 
the rate it was when the fully developed claim program was new.
    Mr. *O'Rourke.* Okay. Thank you. My time has expired, Mr. 
Chair. I'll yield back. Thank you.
    Mr. Runyan. Thank the gentleman. Any members have any 
further questions? No? On behalf of the Subcommittee, I thank 
you all for your testimony. You are now excused. I thank 
everyone for being here with us today.
    Ensuring that our veterans receive timely and appropriate 
decisions regarding their service-connected claims is a top 
priority for both this Committee and the Department. It is 
unacceptable for the price that is--timeliness to be the 
accuracy of those decisions, and we'll certainly be seeking 
more information in the near future on areas discussed as VA 
continues to march towards the Secretary's 2015 goals.
    I'd like to once again thank our witnesses for being here 
today. I just announce consent that Members have five 
Legislative days to revise and extend their remarks and include 
any extraneous material.
    Hearing no objections, so ordered. Thank the Members for 
their attendance today, and this hearing is adjourned.
    [Whereupon, at 6:16 p.m., the subcommittee was adjourned.]
                                APPENDIX

STATEMENT BY JEFFREY C. HALL ON DISABLED AMERICAN VETERANS

    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 submit testimony 
for the record on the Department of Veterans Affairs' (VA) 
adjudication of complex disability claims and ensuring quality, 
accuracy, and consistency on complicated issues. 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 as well as the various ways veterans may 
appeal adverse actions and decisions.
    Mr. Chairman, for the first time in years, some good news 
is coming out of the Veterans Benefits Administration (VBA) in 
regard to the backlog of veterans' disability compensation and 
pension claims. Despite a partial government shutdown that 
disrupted progress for most of October 2013, VBA appears to 
have finally turned a corner for the first time in more than 
two decades. However, despite the laudable progress and 
milestones that have been achieved, significant work remains to 
be done before VBA can hope to completely eliminate the backlog 
and reform the claims processing system so that every claim is 
done right the first time, including the most complicated 
claims.
    At the beginning of 2013, there were more than 860,000 
pending claims for disability compensation and pension. By the 
end of the year, that number had dropped by more than 20 
percent, down to about 693,000 pending, a reduction of more 
than 20 percent. The number of claims in the backlog - greater 
than 125 days pending - dropped by more than a third, from over 
611,000 in January 2013 to less than 392,000 at present. VBA 
also increased the number of claims completed each month from 
an average of about 89,000 during the first four months of the 
year to more than 110,000 over the final eight months of the 
year; however the cause is unclear. VBA also reports that the 
average days for rating pending claims has dropped this year 
from 280 days to under 180 days, and there are virtually no 
claims remaining that have been pending for more than a year.
    The most important factor driving VBA's productivity gains 
was undoubtedly the policy of mandatory overtime for claims 
processors that ran from May through November. During this six 
month stretch, VBA achieved significant boosts in the number of 
completed claims per month, reaching as high as129,488 in 
August, before dropping back down during the shutdown and after 
mandatory overtime ended before Thanksgiving. The other key 
factors boosting claims production were likely the increased 
focus on fully developed claims (FDC), which rose to more than 
12 percent of VBA's claims inventory, and the continued 
professional development of VBA's newest employees hired during 
the past five years. Although VBA finished the roll out of both 
Veterans Benefits Management System (VBMS) and the new 
Transformation Organizational Model (TOM) last year, this 
likely had only a marginal influence on productivity increases 
last year since there is a learning curve that both employees 
and management must complete before they reach their full 
productive potential with new systems.
    While the drop in the backlog was certainly good news, even 
more encouraging was the steady increase in the accuracy of 
claims produced throughout the year, as measured by the 
Systematic Technical Accuracy Review (STAR) teams. According to 
VBA, their 12-month measure for rating claims accuracy rose 
from 85.7 percent at the beginning of the year to nearly 90 
percent by the end of November. Although this remains far from 
the 98 percent accuracy goal put forward by the Secretary, it 
is a significant improvement. As VBA officials regularly point 
out, however, when using an issue-based standard, rather than 
claims-based since one claim may contain many separate issues, 
the accuracy rate is even higher, approaching 97% during the 
final months of 2013.
    There are several likely causes for the increased accuracy 
of rating claims. First, statutory and regulatory changes have 
eliminated virtually all errors related to the duty to notify 
veterans of their rights under the Veterans Claims Assistance 
Act (VCAA), since the required notice is now included on the 
application form itself. Inadequate VCAA notice had 
historically been one of the largest categories of STAR errors 
Second, the use of VBMS has automated many of the required 
development steps required to properly prepare a claim to be 
rated, such as scheduling compensation exams and routine future 
examinations, thereby reducing the number of these types of 
errors by more than 50 percent. Third, rating calculators and 
other automation tools have helped to prevent inaccurate 
ratings because the system will not accept disability 
evaluation levels outside certain parameters established for 
each diagnostic code. Finally, VBA's new Quality Review Teams 
(QRTs) have had a positive effect on the quality and accuracy 
of ratings.
    All of this progress comes after four years of 
comprehensive transformation - that included implementation of 
new organizational and operating processes, new IT systems, and 
new training, testing and quality control regimes - all 
designed to reach the Secretary's ambitious goals for 2015 of 
all claims within 125 days with 98 percent claims accuracy.
    One of the cornerstones of this transformation is the TOM, 
which is based upon the segmentation of claims based on their 
complexity. At the beginning of the new process, VBA's 
traditional triage function has been replaced with a new Intake 
Processing Center that puts an experienced Veterans Service 
Representative (VSR) at the front end of the process to divide 
claims along three separate ``lanes:'' ``Express,'' ``Core,'' 
and ``Special Ops.'' The Express Lane is for claims that are 
less difficult, such as those that are fully developed or those 
containing one or two issues, etc. The Core Lane is for 
processing claims involving three to seven contentions, as well 
as claims for individual unemployability. And the Special Ops 
Lane is for more difficult claims, such as those with eight or 
more contentions, long-standing pending claims; complex 
conditions, such as traumatic brain injury (TBI), post-
traumatic stress disorder (PTSD), military sexual trauma (MST), 
special monthly compensation (SMC), and other claims requiring 
extensive time and expertise.
    VBA estimates that about 30 percent of claims will be 
processed through the Express lane, about 60 percent through 
the Core lane and about 10 percent through the Special Ops 
lane. In each of these lanes, integrated teams comprised of 
VSRs, RVSRs and Decision Review Officers (DROs) work in close 
proximity so that they can better coordinate their efforts and 
increase production. Although there have been increases in both 
production and quality over the past year using the TOM, VBA 
must regularly measure, carefully analyze and continually 
improve its new operating procedures to fix problems and 
maximize efficiencies. We have been particularly interested to 
learn whether VBA might be tempted to more resources and 
personnel in the Express Lane as a tactic to generate greater 
production and artificially lower the pending backlog of 
claims. While such a redistribution of VBA resources would 
allow VBA to move a larger number of simple claims more quickly 
and thus lower the number of pending claims, it would force 
much longer delays on veterans awaiting decisions on the more 
complex claims, including those with eight or more contentions, 
or those suffering from PTSD.
    DAV recently surveyed a number of our National Service 
Offices to learn more about how VA Regional Offices (VARO) were 
distributing their personnel among the lanes and found wide 
variations. For example, at one VARO, the distribution of VSRs 
and Rating Veterans Service Representatives (RVSR) among the 
lanes was 31 percent in the Express, 56 percent in the Core and 
13 percent in the Special Ops. At a similar sized VARO, the 
distribution was 48 percent in the Express, 22 percent in the 
Core and 30 percent in the Special Ops. While the needs in each 
particular VARO differ, there is clearly a disparity in the 
amount of personnel assigned to a particular lane. In some 
VAROs, DAV's National Service Officers (NSOs) observed that the 
distribution appeared to be reasonable based on their 
observations of the makeup of that particular VARO's workload, 
while others observed understaffing of one or more of the 
segmented lanes. Others commented that too often VARO personnel 
were being shifted from one lane to another based upon the 
current month's priority. It is essential that VBA be aware of 
such wide ranging differences among VAROs, analyze both 
workload data and the distribution of resources, and ensure 
that sufficient personnel are being assigned to each of the 
lanes, particularly the more complicated claims that require 
greater time and expertise.
    According to VBA, employees working within the Special Ops 
Lane are individuals who possess the highest skill level, and 
are required to complete an additional 20 plus hours of 
training and testing on more complex issues such as TBI and MST 
to ensure accuracy when preparing a rating. Additionally, all 
ratings in the Special Ops Lane require a second signature 
until the RVSR has demonstrated a 90 percent accuracy with 
consistency. While the exact number of necessary personnel 
assigned to handle the more complex claims like TBI, PTSD, 
etc., within the Special Ops Lane, or their respective 
experience level is difficult to ascertain, DAV believes these 
individuals should be the more experienced and skilled 
employees, particularly RVSRs.
    Another concern expressed by some of DAV's NSOs was that 
VBA was sometimes placing claims in the wrong lanes: complex 
claims going through the Core lane or too many multi-issue 
claims being directed to the Express lane. In order to prevent 
these errors in directing claims to the right lane, VBA must 
ensure that the personnel at the Intake Processing Center of 
each VARO have the proper training and experience required to 
make these crucial decisions.
    A related concern we have is that VBA may be neglecting the 
preparation of claims awaiting certification to the Board of 
Veterans' Appeals. There have been reports that some VAROs have 
redirected some VSRs and RVSRs who normally work on preparing 
appeals instead to work only on claims that contribute to 
lowering the backlog. Again, such an approach may yield short-
term gains in reducing the claims backlog, but it will have 
longer term negative consequences for the growing backlog of 
appeals, which now stands at more than 266,000.
    In order to continue incentivizing quality and accuracy 
along each track, especially the Special Ops lane for 
complicated claims, VBA must also ensure that performance 
standards are adjusted appropriately for VSRs' and RVSRs' work 
on each of the different tracks within the new organizational 
model. Production standards for VSRs and RVSRs handling the 
simplest claims must be different from those handling the most 
complex, which take more time per claim. Employees handling 
complex Special Ops claims should not be held to the same 
performance levels in terms of claims completed per day as 
those handling simpler Express claims.
    Understanding that this model will continue to change as 
technology evolves concurrently, it would be wise for VBA to 
consult with the American Federation of Government Employees 
(AFGE) and other labor representatives in developing a mutually 
acceptable framework for quickly adjusting performance 
standards in the future as conditions merit. As new processes 
and technologies come online, it is imperative that VBA be able 
to make timely adjustments to performance standards to ensure 
that production pressures do not outweigh the goals of accuracy 
and quality. DAV believes that VBA must develop a scientific 
methodology for measuring the resources (primarily personnel) 
required to accurately and timely process the current and 
future anticipated workload, as well as a new model for 
allocating those resources among VA regional offices.
    One of the keys to reducing the backlog has been and will 
continue to be the FDC program. DAV continues to actively 
support the FDC program and by the end of fiscal year 2013, 
nearly 25 percent of all claims submitted to VBA were filed 
through the FDC program. This approach not only lowers the 
burden on VBA employees, it also results in faster and more 
accurate claims decisions for veterans. However, we recognize 
that not all claims can be filed as ``fully developed'' and VBA 
must continue to maintain and improve the manner in which it 
processes complex claims.
    Mr. Chairman, in order for VBA to complete the 
transformation, end the backlog and decide each claim right the 
first time, it must develop and inculcate a new work culture 
based on quality and accountability. At a time when so much 
national attention has been focused on reducing the number of 
claims pending in the backlog, VBA must continue to place at 
least equal emphasis on quality and accuracy, rather than just 
speed and production. In fact, accurately deciding a veteran's 
claim for disability should never compromised or sacrificed for 
the sake of productivity. DAV has and always will maintain the 
VBA's attention and focus should be on generating decisions 
that are right the first time. This particularly applies to 
those claims that are more complex and complicated.
    Unfortunately, most of the metrics that VBA employs today 
are based primarily on measures of production, rather than 
quality. For example, the most common way to measure the VBA's 
progress is through its Monday Morning Workload Reports, which 
contain measures of production, but not accuracy or quality. 
Another major tool used to review VBA's status is its ``Aspire 
Dashboard,'' which provides current performance statistics for 
each VARO, and provides national totals. Like the Monday 
Morning Reports, however, the Aspire Dashboard metrics are 
primarily related to pending work inventory and production 
times, with only a few measures of accuracy included. VBA must 
develop new and realistic metrics and performance measures at 
every level in the process: from claims processors to regional 
office management to central office leadership.
    VBA must continue to make the changes to its work culture 
so that quality and accuracy are the cornerstones of all their 
activities, especially in dealing with complex claims. DAV 
believes that VBA's creation of Quality Review Teams was a 
powerful statement of VBA's commitment to quality. QRTs perform 
several functions: they conduct local quality reviews, perform 
in-process reviews and provide select training. In particular, 
the in-process reviews, often referred to as ``mulligan 
reviews,'' allow errors to be corrected before they negatively 
affect a rating decision, and without penalizing the VBA 
employee. VBA must continually evaluate and improve its 
training, testing, and quality control programs in order to 
truly reform the claims system over the long term.
    Another key to changing VBA's culture is how well they 
invest in the training, testing and professional development of 
its workforce. Over the past several years, VBA has 
reengineered its ``challenge'' training program for new 
employees, which consists of four weeks of in-station training 
via ``live meeting'' software, followed by four weeks of in-
residence training at the Baltimore academy or other 
centralized locations around the country. Every employee is 
also required to complete continuing training of 85 hours per 
year coupled with required testing. In addition, VBA has 
developed a new training program called Station Enhancement 
Training (SET), which requires all employees at targeted poor 
performing VAROs to undergo comprehensive training together for 
one week. First begun at some of VBA's lowest performing 
stations, including Oakland, Los Angeles and Baltimore, SET 
allows employees to review and refresh their knowledge, while 
also providing structured time to work live cases under the 
supervision of the training staff. VBA has reported that SET 
training not only increased quality, it also boosted morale of 
employees and VBA expects to continue SET training in 2014.
    Finally, VBA's transformation strategy depends on the 
successful implementation of new technology, including the 
VBMS, the Stakeholder Enterprise Portal (SEP), an expanded e-
Benefits system with VONAPPS Direct Connect (VDC), and the 
Virtual Lifetime Electronic Record (VLER) initiative. In terms 
of processing claims, the most important technology is VBMS, 
the paperless, rules-based system that VBA uses to create 
electronic claims files, manage workflow and determine ratings. 
VBA was able to complete implementation of VBMS ahead of 
schedule in June and by the end of 2013, nearly all of VBA's 
pending claims were processed using electronic files. Going 
forward, VBA must continue to receive and allocate sufficient 
funding for scanning paper claims forms and evidence, including 
the back-scanning legacy files, and must monitor and work to 
improve the quality of the scanned documents.
    It is also vitally important to recognize that no modern IT 
system or software is ever truly ``finished,'' In addition to 
the funding required for maintenance of the VBMS system, VBA 
must continue to make significant investments in VBMS 
development for as long as this system is capable of meeting 
VBA's needs. The coding and embedding of rating calculators 
inside VBMS, for example, remains a labor-intensive, time-
consuming process and one that will continue as the VA Schedule 
for Rating Disabilities (VASRD) is continually updated in the 
future. Furthermore, as new IT technologies emerge, and new 
requirements for VBA are identified, VBMS must evolve to 
address those needs and opportunities, and that will require an 
aggressive development program that has sufficient resources. 
At the same time, VBMS must be carefully developed to ensure 
that it also provides sufficient support for complex claims 
that are not easily done through automated and rules-based 
processes.
    Mr. Chairman, while VBA should be commended for the 
progress made in reducing the backlog of pending claims, now is 
not the time for them or Congress to shift any resources or 
attention away from their longstanding problems in processing 
claims accurately and timely. DAV believes VBA's new 
organizational model of segmented lanes is moving in the right 
direction but there is still work to be one to ensure greater 
consistency and efficiency throughout all VAROs.
    By their very nature, complex claims are more difficult to 
process from the development stage through final rating. VBA 
must ensure that they assign the most skilled and experienced 
individuals to process these claims as well as those at the 
front end responsible for assigning claims to the proper lanes. 
Ultimately, the success of VBA's transformation will not be 
judged on how well they process the large number of simple 
claims, but on how accurately and quickly they adjudicate the 
most complex claims. Getting all claims decisions right the 
first time is the only fair and equitable way to treat to our 
nation's veterans, their dependents and survivors. Anything 
less is unacceptable.
    Mr. Chairman, this concludes my testimony. I would be happy 
to answer any questions you or the Subcommittee.
PATRICIA DRISCOLL ON THE ARMED FORCES FOUNDATION

    Chairman Runyan, Ranking Member Titus, and Distinguished 
Members of the Committee, on behalf of the Armed Forces 
Foundation (AFF), I would like to thank you for the opportunity 
to share our views regarding the work the AFF does for recently 
separated service members suffering from the invisible wounds 
of war.
    The Armed Forces Foundation is a 501(c)3 non-profit 
dedicated to supporting and advocating for active-duty military 
personnel, National Guardsmen, Reservists, military families, 
and veterans. The AFF returns 95 cents of every dollar raised 
to service members and their families through our programs. 
Since 2001, the AFF has provided more than $75 million in 
assistance by covering travel, hotel rooms, home mortgages, car 
payments and everyday bills for families to be able to stay at 
their loved ones' sides during treatment and recovery from 
wounds suffered during war. With the launch of our Help Save 
Our Troops campaign, the AFF proactively educates Americans 
about the hidden wounds of war, including Post-Traumatic Stress 
Disorder (PTSD) and Traumatic Brain Injury (TBI), and advocates 
for those troops and veterans who have suffered these hidden 
wounds. The ultimate goal of Help Save Our Troops is to reduce 
military suicides. Through this campaign, the AFF provides 
counseling services for military families, including children, 
grants for therapy and addiction counseling, and runs a variety 
of recreation group therapy programs to boost morale amongst 
service members, veterans, and their families.
    The program I would like to highlight today is the C.W. 
Bill and Beverly Young Financial Assistance Fund, the largest 
program administered by the AFF. The Fund provides direct 
financial assistance to service members, veterans, and their 
families facing financial hardship due to injuries and other 
service-related situations. With the ability to provide money 
to service members and their families from all branches of 
service, the Foundation makes a valued impact on the lives of 
those who serve the United States.
    Due to the increasing number of recent veterans, the 
Foundation is unable to fill all requests for assistance. 
Currently, the AFF is only able to fulfill 18 percent of all 
requests made. This is why our Board has limited the parameters 
of the Fund to active-duty service members, reservists, 
guardsmen, and service members who have separated from the 
service within the past 18 months. Additionally, the Board has 
established we distribute, each year, at least 90 percent of 
our funds raised. We do not sit on the cash that is donated.
    Since the Fund's inception, millions have been distributed 
in the form of direct financial grants. Cases are reviewed on a 
monthly basis and payments are made directly to creditors or in 
the form of gift cards to in order for veterans to provide the 
basic essentials for their families.
    Of the cases reviewed thus far in 2013, 35 percent of 
grants awarded have gone to recently separated service members. 
Of these cases, exactly 50 percent have been diagnosed with 
Post-Traumatic Stress Disorder (PTSD), Traumatic Brain Injury 
(TBI), or both.
    These statistics are startling to me, given the fact the 
National Institute of Health estimates 1 in 5 veterans of OIF/
OEF suffer from PTSD. Even more troubling is the recent VA IG 
report findings that VA offices are not handling PTSD cases 
correctly.
    With the ever growing backlog of VA claims and the 
inability to process these complex claims correctly, our 
nation's veterans are struggling at home to pay their bills and 
put food on the table.
    This is where the AFF is proud to step up and fill the gap 
as veterans' claims are in limbo. As PTSD diagnoses increase 
each year, so to do the requests for financial grants, as more 
time lapses before a rating is assigned to veterans suffering 
from the invisible wounds of war.
    Again, the AFF would like to thank you for the opportunity 
to present our thoughts on this important issue that many 
veterans face. We look forward to working with this Committee 
to find a solution to the problems being pushed onto veterans.
                                 

STATEMENT OF THE TRAGEDY ASSISTANCE PROGRAM FOR SURVIVORS 
(TAPS)

    Hearing: ``Adjudicating VA's Most Complex Disability 
Claims: Ensuring Quality, Accuracy and Consistency on 
Complicated Issues''
    We are pleased to have the opportunity to submit this 
testimony on behalf of the Tragedy Assistance Program for 
Survivors (TAPS).
    TAPS is the national organization providing compassionate 
care for the families of America's fallen military heroes. TAPS 
provides peer-based emotional support, grief and trauma 
resources, grief seminars and retreats for adults, Good Grief 
Camps for children, online and in-person care groups, casework 
assistance, connections to community-based care, and a 24/7 
resource and information help line for all who have been 
affected by a death in the Armed Forces. Services are provided 
to families at no cost to them. We do all of this without 
financial support from the Department of Defense. TAPS is 
funded by the generosity of the American people.
    TAPS was founded in 1994 by a group of surviving families 
following the deaths of their loved ones in a military plane 
crash. Since then, TAPS has offered comfort and care to more 
than 40,000 people. The journey through grief following a 
military death can be isolating and the long-term impact of 
grief is often not understood in our society today. On average, 
it takes a person experiencing a traumatic loss five to seven 
years to reach his or her ``new normal.''
    TAPS has extensive contact with the surviving families of 
America's fallen military service members, making TAPS uniquely 
qualified to comment on issues affecting the survivors left 
behind. TAPS received an average of 13 newly bereaved survivors 
per day in 2012. Survivors are referred to TAPS through our 
relationships with the Armed Services casualty assistance 
officers and direct contact from those who are grieving the 
death of someone who died while serving the Armed Forces.
    In 2012, 4,807 new survivors came to TAPS for comfort and 
care. In 2013, the number of newly-bereaved military families 
coming to TAPS for care and support continues to climb. Between 
January 1 and October 24, 2013, TAPS sadly welcomed 3,471 newly 
bereaved survivors for care and support. Causes of death were 
reported as follows by military families turning to TAPS for 
help and support:
    Suicide or suicide suspected22.88 % (794)
    Hostile action/killed in action/Navy Yard shooting22.47 % 
(780)
    Accident - auto/aviation/other22.13 % (768)
    Sudden illness17.11 % (594)
    Unknown cause of death10.89 % (378)
    Homicide 2.74 % (95)
    Non-hostile/non-combat incidents 1.73 % (60)
    Friendly-fire 0.06 % (2)
    We would like to submit the following statement on 
adjudicating VA's most complex disability claims.
    Survivor benefits are intrinsically linked to veteran 
disability claims filed with the Department of Veterans Affairs 
(VA). Eligibility for VA survivor benefits for the surviving 
spouse and/or children hinges on establishing a military 
service connection to the cause of death. When a service 
connection is not recognized by the VA, the surviving spouse 
and/or children will often struggle to obtain survivor 
benefits.
    These benefits and services provided by the VA for spouses, 
children and parents of service members and veterans are 
significant and can directly impact the quality of life for 
survivors. These benefits can include: dependency and indemnity 
compensation, parents' dependency and indemnity compensation, 
survivors' pension, the dependents' educational assistance 
program, the post-9/11 G Bill: Marine Gunnery Sergeant John 
David Fry Scholarship program, and home loans. Survivors can 
also receive the following services from the VA if they are 
eligible: educational and vocational counseling, beneficiary 
financial counseling, civil service preference, commissary and 
exchange privileges, and fiduciary services.
    The following data is from the quarterly Monday Morning 
Workload Reports published online by the Veterans Benefits 
Administration (http://www.vba.va.gov/reports/mmwr/).

[GRAPHIC] [TIFF OMITTED] 

    * Award adjustments: Involves the modification of benefits 
based upon additional ancillary factors. Such activity usually 
occurs when a Veteran or survivor is currently entitled and 
receiving benefits, such as adjudication of dependency issues.
    ** Accrued benefits: Benefits not paid prior to the death 
of a Veteran or survivor based upon a pending claim at the time 
of death which is later granted.
    Progress has clearly been made by the VA in 2013 to reduce 
the number of survivors waiting over 125 days for benefits who 
are filing initial claims, pension claims, or burial benefits. 
These categories show some improvements, with volume lowering.
    Even with these improvements, thousands continue to wait 
over 125 days (more than four months) for benefits to be 
processed. The number of survivors waiting for award 
adjustments (dependency), accrued benefits and appeals 
continues to climb.
    TAPS is seeing an increasing number of survivors seeking 
assistance with complex VA claims for survivor benefits. In 
these situations, military service connection to the cause of 
death is not established prior to the death, often because the 
veteran had not applied for VA disability compensation for him 
or herself prior to the death, and because the death was not an 
active duty death.
    In these situations where service connection to the death, 
and therefore eligibility for survivor benefits, is denied by 
the VA, the grieving survivor must prepare evidence and appeal 
to the VA in order to qualify for survivor benefits. Often 
these cases involve a veteran who died by suicide. Their 
traumatized families must compile significant dossiers 
including military service records, health records, and 
statements from colleagues and friends of the veteran. Often 
these appeals can take years, while the surviving spouse, 
children and parents suffer without the benefits to which they 
are entitled to under law.
    In one case, a widow of a Navy veteran who died by suicide 
at age 29 in 2011, has spent the last two years attempting to 
prove service connection to her husband's death and been denied 
twice by the VA. At the time of the death, their dependent 
children were ages 5 and 7. Her husband was under VA care at 
the time of his death, attempted suicide while under VA care, 
and he did not file a claim for VA disability compensation 
while alive because he felt there were others who were more 
deserving of support. There are medical treatment records on 
file for him but he did not apply for service connected 
disability compensation prior to his death. She states that one 
of his VA caseworkers said to her that if he wanted to die by 
suicide, there was nothing that she could do to stop it. She 
believes her husband's problems may have been linked to 
problems he experienced coming out of anesthesia for a hernia 
surgery at the VA. After the surgery, his wife states that his 
mental health declined and he talked about trauma he had been 
exposed to while in the military. She interred her husband in a 
national cemetery managed by the VA in Bushnell, Florida. She 
states that a month after his funeral, she received a letter 
from the VA saying his military personnel and service records 
were lost, so she had to scan his entire service jacket and 
send it to the VA in order to apply for survivor benefits. Her 
applications for benefits have been denied twice. The widow and 
their two young surviving children would benefit greatly from 
the benefits that military service connection to the death 
would permit. She is currently making a decision on whether to 
appeal the VA's decision and attempt again to prove service 
connection to the death. Her case illustrates many of the 
challenges survivors with complex VA claims face.
    We thank the subcommittee for accepting our statement.

DISCLOSURE STATEMENT

    The Tragedy Assistance Program for Survivors (TAPS) has not 
received any Federal grant or contract, relevant to the subject 
matter of this statement, during the current or previous two 
fiscal years.
                                 

MS. SULIN SCHAFER

    Adjudicating VA's Most Complex Disability Claims: Ensuring 
Quality, Accuracy and Consistency on Complicated Issues
    My name is Sulin Schafer. My husband, Errick Schafer is a 
veteran of the United States Air Force. He served for about 10 
years as a fire fighter and had been on multiple deployments. 
We have been married for almost twelve years, and have two 
young sons. Errick is also young (in his thirties). He was a 
top performing military service member, and also participated 
in any sport with a ball. He coached my oldest son's sport 
teams; bass fished, went to the gym, and ate healthy everyday. 
He was full of energy and had a very contagious laugh. He did 
everything right to maintain his health.
    These days, my husband spends most of his days either 
sitting on our living room couch or laying in bed. He depends 
on me to get him in and out of bed, get dressed, eat, bathe, 
and use the bathroom. My once energetic husband who was full of 
laughter and life is now confined to a body that he cannot 
control. If that wasn't enough, he no longer has that 
contagious laugh and can't hold our newborn son. What's the 
cause of all this misery? In November 2012, Errick was 
diagnosed with Amyotrophic Lateral Sclerosis (ALS/Lou Gehrig 
Disease). The doctor said it was military service connected. 
Apparently, there are military service members who have been 
deployed to the Middle East, like my husband, and have been 
diagnosed with this death sentence.
    The doctor suggested we go through the Veteran's 
Administration to file a claim for the disability. When Errick 
first filed the claim, in November 2012, he was still able to 
walk. The VA granted Errick a decision of 100% for ALS. By this 
November, I must transport Errick in a manual wheelchair to get 
around the house. He cannot use his hands or legs. He cannot 
speak clearly, so he is silent for the majority of the time he 
is awake. We rarely leave the house because of the difficulty 
it takes to get in and out of the vehicle. For a couple of 
months, because I was pregnant, my husband had friends from the 
fire department coming over to help. In October, I gave birth 
to our son, and now have to go back to work in the beginning of 
December.
    Errick had applied for the SMC for Aide and Attendance, and 
was granted the upgrade. When we discussed the upgrade with a 
friend, he advised us that the amount did not sound right for 
the condition my husband is in. He suggested we speak with his 
father in law who had retired from the VA as a ``rater''. Our 
friend's father in law looked over the decision letter and 
confirmed that my husband was entitled to a higher rating 
because he has no use of his upper or lower extremities. He 
assisted us in filing a Notice of Disagreement and told me to 
submit it to the VA Representative near Eglin Air Force Base.
    Early November, I went to the VA near Eglin AFB to attempt 
to submit the NOD to the representative. She told me she would 
look over it for me. After a short overview of the NOD, she 
told me that it was wrong, and that my husband has the highest 
rating for SMC. Being that I am not an expert on filing claims 
with the VA, I believed her to be correct. She said she would 
fix the NOD and call me within a couple days when she was done 
with it. I spoke to our friend's father in law, and he said he 
would escort me to the VA office the next time I went. Well, a 
couple days passed, and then a week, but I did not hear from 
the representative. I decided to just go in, and I brought our 
friend's father in law.
    He explained to her the difference between pension and 
compensation, and that my husband, based on his current 
condition, is entitled to a much higher rating than what he is 
receiving. It appeared that she did not know what our friend 
was explaining, even after he showed her in text a list of 
ratings directly from the VA website. Needless to say, we left 
there with nothing accomplished and the disappointment of still 
being told by a VA representative that my husband was still not 
entitled to anything else.
    It saddened me to think of the many other veterans who have 
turned to her for guidance and help in filing their claims, and 
possibly were turned away from what they are entitled to. This 
encounter has delayed the process of filing my husband's NOD. 
Right now we really need it to hire someone to care for my 
husband for the hours that I am at work. With a diagnosis like 
ALS, when time is not on our side, this is an issue that needed 
to be handled more delicately and expeditiously. I have sent 
the NOD with the original disagreement. I have lost confidence 
in the knowledge that the VA representatives should have.
                                 

VETERANS AND MILITARY FAMILIES FOR PROGRESS

    December 2, 2013
    Congressman Jon Runyan
    Chairman, Disabilities Assistance and Memorial Affairs Sub-
Committee
    334 Cannon House Office Building
    Washington, DC. 20003
    RE: Adjudicating VA's Most Complex Disability Claims: 
Ensuring Quality, Accuracy and Consistency on Complicated 
Issues
    Mr. Chairman,
    Veterans and Military Families for Progress (VMFP) wants to 
thank you for holding this hearing on such a timely issue with 
regard to the Department of Veterans Affairs (VA) process of 
adjudication of veterans claims for disability, education and 
other such purposes for the benefits they have rightfully 
earned.
    As you are well aware, the implementation of the Veterans 
Benefits and Management System (VBMS) has recently taken place 
within the VA system of claims centers and Regional Offices 
(RO's). This system has yet to be properly evaluated by the 
legal community or by Veteran Service Organizations (VSO) 
responsible for representing veterans in their claims.
    It is our belief the VA's attempt at this implementation is 
not in the best interest of the veteran. This is an electronic 
set of systems with many hidden features. It is not open to 
general interpretation or scrutiny. This adds a layer of 
complexity and confusion with little known results, oversight 
or regulatory conformance.
    In reviewing the overall process, the legal obstacles, in 
and of themselves, are a burden to most veterans and the lack 
of assistance from the VA initially is daunting. With this new 
level of unknown electronic operations, guaranteed only by VA, 
to process an initial claim is not sufficient to warrantee any 
level of fulfillment that claims are being processed accurately 
or consistently. In fact, due to recent reports on claims 
processing, the opposite is more likely true.
    Benefits claim appeals to the Court of Appeals for Veterans 
Claims (CAVC) have increased at a rate of nearly 1,000 claims 
per week. The current claims in the CAVC are at their highest 
point ever.
    In reviewing what is supposed to be the process for a 
veteran or their dependant to apply for a claim, the initial 
application should consist of the request(s) for a specific 
benefit (disability, education, medical needs, etc.) 
accompanied with the veteran's Department of Defense form DD-
214, and any supporting documentation. The increased level in 
obstacles to obtaining the contractually obligated benefits has 
become steeped in laws and unnecessary bureaucracy to the 
detriment of veterans and their families.
    In reviewing the level of consistency in the decisions from 
VA on claims from veterans, the comparable evidence is truly a 
mystery. Claims approvals and denials vary from state to state, 
region to region and office to office. In many case a veteran 
with a valid claim in a specific office will have his or her 
claim denied while a veteran with the exact same claim with the 
exact same evidence will submit the claim to the same office 
and have their claim approved.
    There is also no supporting evidence, since the 
implementation of the VBMS system, the claims process or 
accuracy has either changed or improved. Claims in this system 
can be determined to be accurate and acceptable to VA, only to 
have the claim denied by either a Regional Office (RO) or a 
Director of the RO. This can happen in any office anywhere 
within all of the offices of the VA making these 
determinations. Since the VBMS system can be interfered with or 
altered by an individual, the use of this technology is 
ineffective by most measurable standards of fairness or 
justice.
    In conclusion, the VA is not making any visible or 
measurable strides to create a ``less complicated'' system or 
improving their methods to help veterans. There is no 
measurable evidence the recent changes in VA have done anything 
more than add layers to the existing many layers of 
bureaucratic schemes designed to insure injustice to veterans 
seeking the benefits assigned to them in their agreement when 
they entered military service. The assertion by the VA for the 
added by a technology, originally reported to ``make things 
easier'' for the veterans and government, has no basis in fact. 
The issue of complexity of claims resolution is increased to a 
new level wherein there is no possible method of discovering 
the processes used to reach a decision on how VA arrived at 
their assessment of a claim or what was the application of law 
used in making their determination for a claim.
    VMFP respectfully requests your committee examine the 
disability claims process and the quality of the VA decision 
more closely in the future. Since there is no evidence to 
substantiate that claims quality, process, accuracy or 
complexity has improved in recent months or years, the 
question(s) you have asked in this hearing are of great 
importance to our veterans and their families everywhere.
    Respectfully,
    Ronald D. Scott
    Ronald D. Scott
    President, Veterans and Military Families for Progress
    CC: Committee List

                                 
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