[House Report 119-340]
[From the U.S. Government Publishing Office]
119th Congress } { Report
HOUSE OF REPRESENTATIVES
1st Session } { 119-340
======================================================================
VETERANS AFFAIRS DISTRIBUTED LEDGER INNOVATION ACT OF 2025
_______
October 10, 2025.--Committed to the Committee of the Whole House on the
State of the Union and ordered to be printed
_______
Mr. Bost, from the Committee on Veterans' Affairs, submitted the
following
R E P O R T
together with
MINORITY VIEWS
[To accompany H.R. 3455]
[Including cost estimate of the Congressional Budget Office]
The Committee on Veterans' Affairs, to whom was referred
the bill (H.R. 3455) to direct the Secretary of Veterans
Affairs to conduct a comprehensive study on the use of
distributed ledger technology in the Department of Veterans
Affairs, and for other purposes, having considered the same,
reports favorably thereon without amendment and recommends that
the bill do pass.
CONTENTS
Page
Amendment........................................................
Purpose and Summary.............................................. 2
Background and Need for Legislation.............................. 2
Hearings......................................................... 3
Subcommittee Consideration....................................... 3
Committee Consideration.......................................... 4
Committee Votes.................................................. 4
Committee Oversight Findings..................................... 4
Statement of General Performance Goals and Objectives............ 4
Earmarks and Tax and Tariff Benefits............................. 4
Committee Cost Estimate.......................................... 4
Budget Authority and Congressional Budget Office Estimate........ 4
Federal Mandates Statement....................................... 5
Advisory Committee Statement..................................... 5
Applicability to Legislative Branch.............................. 5
Statement on Duplication of Federal Programs..................... 6
Section-by-Section Analysis of the Legislation................... 6
Minority Views................................................... 7
PURPOSE AND SUMMARY
H.R. 3455, the ``VA Distributed Ledger Innovation Act of
2025,'' was introduced by Representative Nancy Mace of South
Carolina on May 15, 2025. The bill would require the Department
of Veterans Affairs (VA) to conduct a comprehensive feasibility
study on the use of distributed ledger technology (DLT),
including blockchain, across VA's benefits administration
systems. The study would evaluate the potential for DLT to
improve claims adjudication, strengthen audit trails, and
prevent fraud, waste, and abuse within VA programs.
BACKGROUND AND NEED FOR LEGISLATION
Section 1: Short Title
This section would establish the short title of the bill as
the ``VA Distributed Ledger Innovation Act of 2025.''
Section 2: Sense of Congress
This section provides a Sense of Congress's policy view for
the legislation by recognizing that emerging technologies such
as DLT may significantly strengthen VA operations by improving
benefits allocation, managing insurance programs more
effectively, and maintaining records with greater accuracy and
accountability.
Section 3: Department of Veterans Affairs Study on Use of Distributed
Ledger Technology
VA processes more than 2.5 million benefit claims each
year. Yet persistent inefficiencies, data integrity issues, and
vulnerabilities to fraud continue to undermine the system. The
Government Accountability Office (GAO) and VA's Office of
Inspector General (OIG) have repeatedly flagged challenges in
claims verification and fraud prevention. Outdated legacy
systems lack real-time auditability and traceable transparency,
leaving critical gaps in oversight.
The Committee believes that with veterans' trust on the
line and billions of taxpayer dollars invested in VA, Congress
has a responsibility to ensure VA is equipped with modern tools
that promote accountability, security, and efficiency. DLT
offers a secure and proven tamper-resistant method to track and
verify data, enhance audit trails, and detect irregularities in
real time. The Committee believes these attributes would make
it a promising tool to support VA's mission. This section would
take a careful, first-step approach by directing VA to conduct
a comprehensive feasibility study on how DLT could improve
claims adjudication, enhance data transparency, and reduce
fraud, waste, and abuse in benefits administration. The study
would also assess DLT's potential to improve the accuracy of
benefit allocations, increase the traceability of service and
medical records, and modernize VA's broader data systems. It is
modeled on similar efforts by the Centers for Medicare &
Medicaid Services (CMS) and other federal agencies that have
already explored blockchain applications.
VA oversees one of the federal government's most complex
and sensitive data ecosystems. By studying blockchain's
applicability, this section would enable VA to explore whether
secure and modern technology can strengthen oversight, protect
veterans' personal information, and streamline the delivery of
benefits, without imposing mandates or committing to
implementation prematurely. The Committee believes that this
section would ensure Congress is taking a responsible and
forward-looking approach and ensure VA is equipped to serve
veterans with the integrity, efficiency, and transparency they
deserve.
HEARINGS
On March 24, 2025, the Committee on Veterans' Affairs
Subcommittee on Technology Modernization held an oversight
hearing titled ``Closing the Data Gap: Improving
Interoperability Between VA and Community Providers,''
examining healthcare interoperability and VA's ability to use
information that has been exchanged.
The following witnesses testified:
Dr. Jonathan Nebeker, M.D., Chief Medical Informatics
Officer & Executive Director of Clinical Informatics,
Veterans Health Administration, U.S. Department of
Veterans Affairs; Dr. Laura Prietula, Deputy Chief
Information Officer, Electronic Health Record
Modernization Integration Office, U.S. Department of
Veterans Affairs.
Mr. Rick McGraw, Chief Growth Officer, Michigan
Health Information Network Shared Services; Dr. Andrew
Rosenberg, M.D., Chief Information Officer, Michigan
Medicine; Dr. Leo Greenstone, M.D., Chief Medical
Officer, Signature Performance.
On June 11, 2025, the Committee on Veterans' Affairs
Subcommittee on Oversight and Investigations held a legislative
hearing on H.R. 3455 and other bills pending before the
subcommittee.
The following witnesses testified:
Ms. Cherri Waters, Acting Deputy Chief Information
Officer; Executive Director, Health Portfolio, Product
Delivery Services, Office of Information and
Technology, U.S. Department of Veterans Affairs; Ms.
Laura Duke, Chief Financial Officer, Veterans Health
Administration, U.S. Department of Veterans Affairs;
Dr. Toni Phillips, Chief Nurse Informatics Officer,
Electronic Health Record, Management Information
Office, U.S. Department of Veterans Affairs; Dr.
Jennifer McDonald, Director, Community Care Division,
Office of Audits and Evaluations, Office of the
Inspector General, U.S. Department of Veterans Affairs.
Dr. Edward O'Bryan, MD, MBA, CPE, Chief, Veterans and
Corrections ICCE, Associate Professor of Medicine,
Medical University of South Carolina; Mr. Cole T. Lyle,
Director of the Veterans Affairs & Rehabilitation
(VA&R) Division, The American Legion; Mr. Cody Carbone,
Chief Executive Officer, The Digital Chamber.
SUBCOMMITTEE CONSIDERATION
On July 23, the Committee on Oversight and Investigations
was discharged from further consideration of H.R. 3455.
COMMITTEE CONSIDERATION
On July 23, 2025, the full Committee met in an open markup
session to consider H.R. 3455. During consideration of the
bill, the following amendments were considered:
An amendment to H.R. 3455 was offered by Ranking Member
Takano of California that would have expanded the scope of the
bill's study on distributed ledger technology. The amendment
would have required VA to contract with a federally funded
research and development center (FFRDC), assess unrelated
technology alternatives, and impose implementation
restrictions. The amendment failed by voice vote.
A motion by Representative Jack Bergman of Michigan to
report H.R. 3455 favorably to the House of Representatives was
agreed to by voice vote.
COMMITTEE VOTES
In compliance with clause 3(b) of rule XIII of the Rules of
the House of Representatives, no recorded votes was taken on
amendments or in connection with ordering H.R. 3455 reported to
the House.
COMMITTEE OVERSIGHT FINDINGS
In compliance with clause 3(c)(1) of rule XIII and clause
(2)(b)(1) of rule X of the Rules of the House of
Representatives, the Committee's oversight findings and
recommendations are reflected in the descriptive portions of
this report.
STATEMENT OF GENERAL PERFORMANCE GOALS AND OBJECTIVES
In accordance with clause 3(c)(4) of rule XIII of the Rules
of the House of Representatives, the Committee's performance
goals and objectives of H.R. 3455, are to require the VA
Secretary to conduct a study on the use of distributed ledger
technology to improve the benefits claims adjudication process.
EARMARKS AND TAX AND TARIFF BENEFITS
H.R. 3455 does not contain any Congressional earmarks,
limited tax benefits, or limited tariff benefits as defined in
clause 9 of rule XXI of the Rules of the House of
Representatives.
COMMITTEE COST ESTIMATE
The Committee adopts as its own the cost estimate on H.R.
3455, prepared by the Director of the Congressional Budget
Office.
BUDGET AUTHORITY AND CONGRESSIONAL BUDGET OFFICE COST ESTIMATE
Pursuant to clause 3(c)(3) of rule XIII of the Rules of the
House of Representatives, the following is the cost estimate
for H.R. 3455, as amended, provided by the Congressional Budget
Office pursuant to section 402 of the Congressional Budget Act
of 1974:
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
H.R. 3455 would require the Department of Veterans Affairs
(VA) to study how distributed ledger technology could improve
the adjudication of claims for VA benefits. (Distributed ledger
technology is a system that allows simultaneous access,
validation, and record updating across a networked database.)
In conducting the study, VA would be required to consult with
outside parties and examine certain elements, such as the
technology's ability to reduce fraud. The agency would be
required to report to the Congress on the study's findings
within one year of enactment. Using information on the cost of
similar studies, CBO estimates that H.R. 3455 would cost less
than $500,000. Any spending would be subject to the
availability of appropriated funds.
The CBO staff contact for this estimate is Logan Smith. The
estimate was reviewed by Christina Hawley Anthony, Deputy
Director of Budget Analysis.
Phillip L. Swagel,
Director, Congressional Budget Office.
FEDERAL MANDATES STATEMENT
Section 423 of the Congressional Budget and Impoundment
Control Act (as amended by Section 101(a)(2) of the Unfunded
Mandate Reform Act, P.L. 104-4 is inapplicable to H.R. 3455.
ADVISORY COMMITTEE STATEMENT
No advisory committees within the meaning of section 5(b)
of the Federal Advisory Committee Act would be created by H.R.
3455.
APPLICABILITY TO LEGISLATIVE BRANCH
The Committee finds that H.R. 3455, does not relate to the
terms and conditions of employment or access to public services
or accommodation within the meaning of section 102(b)(3) of the
Congressional Accountability Act.
STATEMENT ON DUPLICATION OF FEDERAL PROGRAMS
Pursuant to clause 3(c)(5) of rule XIII of the Rules of the
House of Representatives, the Committee finds that no provision
of H.R. 3455, would establish or reauthorize a program of the
Federal Government known to be duplicative of another Federal
program, a program that was included in any report from the
Government Accountability Office to Congress pursuant to
section 21 of Public Law 111-139, or a program related to a
program identified in the most recent Catalog of Federal
Domestic Assistance.
SECTION-BY-SECTION ANALYSIS OF THE LEGISLATION
Section 1: Short title
Section 1 would establish the short title of the bill as
the ``VA Distributed Ledger Innovation Act of 2025.''
Section 2: Sense of Congress
This section would provide a Sense of Congress for the
legislation.
This section specifies that veterans are entitled to
receive their earned benefits and services in a manner that is
efficient, transparent, and secure. In this section, DLT, often
referred to as blockchain, is recognized as a promising tool
for improving data integrity, security, and transparency. This
section also recognizes that emerging technologies such as DLT
may significantly strengthen VA operations by improving
benefits allocation, managing insurance programs more
effectively, and maintaining records with greater accuracy and
accountability.
Section 3: Department of Veterans Affairs study on use of distributed
ledger technology
This section would require the Secretary to conduct a
comprehensive study on the feasibility, potential benefits, and
risks associated with using DLT, such as blockchain, across
various programs and services at VA.
This section would define the specific matters to be
examined in the study, including improving accuracy in
allocating veterans' benefits; preventing and detecting fraud,
waste, and abuse in VA systems; enhancing efficiency, security,
and transparency of VA data systems; and improving the storage
and traceability of service and medical records.
This section would require the Secretary to consult with
various subject matter experts, veteran service organizations
(VSO), and coordination with relevant agencies.
This section would require the Secretary to submit a report
to Congress no later than one year after the enactment of the
Act. The report would contain findings from the study,
recommendations for implementation, and any legislative or
administrative actions needed.
This section would also define key terms used in this
section, including ``distributed ledger technology'' and
``blockchain.''
MINORITY VIEWS
H.R. 3455 would require the Secretary of Veterans Affairs
to initiate a study into the effectiveness of the potential use
of distributed ledger, or blockchain, technology at the
Department. While Democratic Members do not take issue with the
concept of a study to analyze such use cases, the bill, as
drafted, does not necessitate a well-rounded study and could
push VA to adopt an unvetted technology that does not align
with VA workflows and processes.
At the Subcommittee on Oversight and Investigations
legislative hearing on June 11, 2025, VA did not provide views
on H.R. 3455, as the Department is ``assessing potential use
cases for [distributed ledger] technology.'' Without any
insight to VA's approach to implementing such a study or
technology, Democratic Committee Members are hesitant to
support such legislation and worry that H.R. 3455 would
accelerate VA's involvement in an unvetted technology.
At a full Committee markup on July 23, 2025, Ranking Member
Mark Takano (D-CA) introduced an amendment to H.R. 3455 that
would have included several common-sense measures to ensure
that the Department of Veterans Affairs (VA) understood both
the potential benefits and consequences of implementing
distributed ledger technology, prior to doing so. For instance,
while VA assesses how blockchain technology might improve
operations, this amendment would also have required the
Department to assess how it may create security
vulnerabilities, data privacy concerns, or place undue pressure
on an already constrained OIT workforce.
Additionally, the amendment would have required the
Department to establish baseline guidelines and structures to
ensure if such technology was deployed at VA, that it would be
done effectively and with consistent application. Firstly, the
amendment called for the creation of internal regulations
guiding the use of blockchain. If the study is carried out by
an adequate third-party organization, as Ranking Member
Takano's amendment calls for, the analysis of how blockchain
may impact VA, both positively and negatively, could aptly
inform such regulations.
Secondly, many modernization efforts within the Department
have suffered from not having the right stakeholders involved
in critical decision points and communication plans. As such,
this amendment would have required VA to create a governance
structure that touches on all stakeholders involved in the
implementation, organization, and maintenance--from the end
users who may be using such technology, to the information
technology professionals that may be ensuring that such usage
does not impact other VA functions.
Lastly, the amendment called for the publication of a
comprehensive strategy that places a specific focus on staffing
levels across the Department, particularly within VA's
modernization workforce, as well as the schedule of other
substantial projects VA is taking on, like the Electronic
Health Record Modernization (EHRM), the Financial Management
Business Transformation (FMBT) program, and supply chain.
Without understanding where gaps exist in VA's modernization
workforce, the Department may face significant pauses or even
failures when it comes to implementation of a technical shift
on outdated VA systems.
IT capacity at VA is being severely eroded while multiple
efforts are underway to expand and accelerate other
modernization efforts like those substantial efforts listed
above. Adding yet another new technology that either must align
itself to a new system, or requires that system, and the
employees that work on it, to adjust their workflows is likely
to lead to complications and incomplete projects.
Mark Takano,
Ranking Member.
[all]