Military Disability Evaluation: Ensuring Consistent and Timely	 
Outcomes for Reserve and Active Duty Service Members (06-APR-06, 
GAO-06-561T).							 
                                                                 
The House Subcommittee on Military Personnel asked GAO to discuss
the results of its recent study on the Military Disability	 
Evaluation System. In this study, GAO determined (1) how current 
DOD policies and guidance for disability determinations compare  
for the Army, Navy, and Air Force, and what policies are specific
to reserve component members of the military; (2) what oversight 
and quality control mechanisms are in place at DOD and these	 
three services of the military to ensure consistent and timely	 
disability decisions for active and reserve component members;	 
and (3) how disability decisions, ratings, and processing times  
compare for active and reserve component members of the Army, the
largest branch of the service, and what factors might explain any
differences.							 
-------------------------Indexing Terms------------------------- 
REPORTNUM:   GAO-06-561T					        
    ACCNO:   A51017						        
  TITLE:     Military Disability Evaluation: Ensuring Consistent and  
Timely Outcomes for Reserve and Active Duty Service Members	 
     DATE:   04/06/2006 
  SUBJECT:   Aid for the disabled				 
	     Disability benefits				 
	     Eligibility determinations 			 
	     Military personnel 				 
	     Military policies					 
	     Persons with disabilities				 
	     Policy evaluation					 
	     Program evaluation 				 
	     Program management 				 
	     Comparative analysis				 
	     Quality control					 

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GAO-06-561T

     

     * Background
          * DOD Policies and Guidance Allow the Services to Implement th
          * DOD and the Services Have Established Policies That Result i
          * Questions About Line of Duty Determinations
          * Army Reservists Often Are Not Returned Home for Medical Trea
          * Several Features of the Disability Evaluation System Are Int
          * Lack of Oversight by DOD and the Services Provides Little As
          * DOD Has Instituted Timeliness Goals for Processing Disabilit
          * DOD's Delegation of Training to the Services and Staff Turno
          * Some Inconsistencies May Exist in Disability Decisions for
          * Poor Quality Data Precluded GAO Analysis, but the Army Repor
     * Conclusions
     * GAO Contact
     * Staff Acknowledgments
     * GAO's Mission
     * Obtaining Copies of GAO Reports and Testimony
          * Order by Mail or Phone
     * To Report Fraud, Waste, and Abuse in Federal Programs
     * Congressional Relations
     * Public Affairs

Testimony before the Subcommittee on Military Personnel, Committee on
Armed Services, House of Representatives

United States Government Accountability Office

GAO

For Release on Delivery Expected at 9:00 a.m. EDT

Thursday, April 6, 2006

MILITARY DISABILITY EVALUATION

Ensuring Consistent and Timely Outcomes for Reserve and Active Duty
Service Members

Statement of Robert E. Robertson, Director, Education, Workforce, and
Income Security Issues

Military Disability Evaluation 

GAO-06-561T

Mr. Chairman and Members of the Subcommittee:

Thank you for inviting me to present the results of our work in response
to this committee's mandate to review the Department of Defense (DOD)
disability evaluation system, in particular how the system ensures that
decisions in reserve and active duty cases are consistent and timely.
Under certain circumstances, both active duty and reserve component
members of the military are entitled to receive compensation for
service-incurred or -aggravated injuries or illnesses that render them
unfit for continued military service. According to DOD regulations, a
primary goal of the military disability evaluation system is to ensure
consistent and timely decisions for active duty and reserve component
members.

Over the past 5 years, nearly half a million reserve component members
across all services have been mobilized to augment active duty military
forces in conflicts and peacekeeping missions worldwide.1 In total, the
Army, Navy, and Air Force evaluated 23,316 disability cases in fiscal year
2005. One in four of these was a reservist's case. Because reserve
component members represent a substantial proportion of the mobilized
military force, it is incumbent on DOD and the military to ensure that
disability decisions made in their cases are consistent with those made in
the cases of active duty members, and as timely.

The information I'm providing today is based on work we reported on March
31, 2006, which was completed in accordance with generally accepted
government auditing standards.2 I will be discussing (1) how current DOD
policies and guidance for disability determinations compare for the Army,
Navy, and Air Force, and what policies are specific to reserve component
members of the military; (2) what oversight and quality control mechanisms
are in place at DOD and these three services to ensure consistent and
timely disability decisions for active and reserve component members; and
(3) how disability decisions, ratings and processing times compare for
active and reserve component members of the Army, the largest branch of
the military, and what factors might explain any differences.

1In this testimony, the word "reservist" refers to a reserve component
member.

2GAO, Military Disability System: Improved Oversight Needed to Ensure
Consistent and Timely Outcomes for Reserve and Active Duty Service
Members, GAO-06-362 (Washington, D.C.: Mar. 31, 2006).

In summary, GAO found that DOD has explicitly given the services the
responsibility to set up their own processes for certain aspects of the
disability evaluation system and has given them latitude in how they go
about this. As a result, each service implements its system somewhat
differently. Further, the laws that govern military disability and DOD and
service policies implementing these laws have led reservists to have
different experiences in the disability system compared to active duty
members. While DOD has issued policies and guidance to promote consistent
and timely disability decisions for active duty and reserve disability
cases, DOD is not monitoring compliance, and neither DOD nor the services
systematically determine the consistency of disability decision making.
With regard to ensuring the timeliness of disability case processing, DOD
has issued processing time goals but is not collecting information to
determine compliance. Our own statistical analysis found that Army
reservists received similar disability ratings as their active duty
counterparts, but reservists may be less likely to receive military
disability benefits than their active duty counterparts. Data available
from the Army were not reliable enough for our analysis. However, Army
statistics indicate that from 2001 through 2005 reservists' cases took
longer to process than active duty soldiers' cases.

                                   Background

Service members who become physically unfit to perform military duties due
to service-incurred or -aggravated injuries or illnesses may receive
military disability compensation under certain conditions. Each of the
services administers its own disability evaluation process. According to
DOD regulations, the process should include a medical evaluation board
(MEB), a physical evaluation board (PEB), an appellate review process, and
a final disposition. Each service member who goes through the system
should be assigned a Physical Evaluation Board Liaison Officer (PEBLO) to
help the service member navigate the system and prepare documents for the
PEB.

There are a number of steps in the disability evaluation process and
several factors play a role in the decisions that are made at each step.
See fig. 1.

Figure 1: Decisions Made During the Military Disability Evaluation Process

The disability evaluation process has four possible outcomes. A service
member can be

           1. Found fit for duty;
           2. Separated from the service without benefits-service members
           whose disabilities were incurred while not on duty or as a result
           of intentional misconduct are discharged from the service without
           disability benefits;
           3. Separated from the service with lump sum disability severance
           pay; or
           4. Retired from the service with permanent monthly disability
           benefits or placed on the temporary disability retirement list
           (TDRL).

The disability evaluation process begins at a military treatment facility
(MTF) when a physician medically evaluates a service member's injury or
condition to determine if the service member meets the military's
retention standards, and prepares a narrative summary describing the
findings. This process is referred to as a medical evaluation board (MEB).
Service members who meet retention standards are returned to duty. Those
who do not are referred to the physical evaluation board (PEB).

The first step in the PEB stage of the process is the informal PEB-an
administrative review of the case file without the presence of the service
member. To arrive at its findings and recommendations regarding
eligibility for disability benefits, the PEB determines if service members
are fit for duty and their injuries or conditions are compensable, and
what disability rating their injuries or conditions should be assigned.
The PEB also considers the stability of the condition in cases eligible
for monthly disability retirement benefits. Service members with
conditions that might improve or worsen are placed on TDRL and reevaluated
by the PEB at least every 18 months to determine if their condition has
stabilized. Those who continue to be unfit for duty after 5 years on TDRL
are separated from the military with monthly retirement benefits,
discharged with severance pay, or discharged without benefits, depending
on their condition and years of service.

Service members have the opportunity to review the informal PEB's findings
and may request a formal hearing with the PEB. However, only those found
unfit are guaranteed a formal hearing. If service members disagree with a
formal PEB's findings and recommendations, they can, under certain
circumstances, appeal to the reviewing authority of the PEB. Once the
service member either agrees with the PEB's findings and recommendations
or exhausts all available appeals, the reviewing authority issues the
final disposition in the case.

DOD Policies and Guidance Allow the Services to Implement the Disability
Evaluation System Differently

DOD explicitly gives the services responsibility for administering the
military disability evaluation system. While DOD regulations establish
some parameters and guidelines for this system, the services have
considerable latitude in how they interpret them. Consequently, across the
services there are differences in MEB and PEB procedures and the use of
counselors to help service members navigate the system.

With regard to the MEB, the medical evaluation of a service member's
ability to meet military retention standards, the Air Force convenes an
actual board of physicians who meet regularly and vote on whether service
members meet retention standards. In contrast, the Army and Navy MEBs are
informal procedures during which case files are separately reviewed by
board members. Each branch of the service has established PEB to determine
whether service members who do not meet medical retention standards are
entitled to disability compensation. Makeup of the board differs by
service. The Army allows the same individuals to sit on both the informal
and formal PEB in the same case. The Air Force allows this only under
certain circumstances. The Navy has no written policy on the matter, and
one Navy PEB official indicated that the same individuals often served on
both informal and formal PEBs in a case.

DOD regulations require that each service assign a Physical Evaluation
Board Liaison Officer to service members whose disability cases are being
evaluated. According to these regulations, PEBLOs are expected to counsel
these service members on their rights, the effects of MEB and PEB
decisions, and available disability benefits. Each service employs PEBLO
counselors in accordance with these rules, but has placed them under
different commands, begins the counseling process at different points in
the disability evaluation process, and provides PEBLOS with different
levels of training.

DOD and the Services Have Established Policies That Result in Different
Experiences with the Disability System for Reservists

Due to the part-time nature of reserve service, some laws governing
military disability compensation result in different experiences with the
disability system for reservists. Under the law, to receive monthly
disability retirement benefits, a service member determined unfit for duty
must have at least 20 years of active duty service or a disability rated
at least 30 percent. Because reservists are not on duty at all times, it
takes longer for them to accrue the 20 years of service needed to qualify
for monthly disability retirement benefits when their disability rating is
less than 30 percent.

Part-time status also makes it more difficult for reservists with
preexisting conditions to be covered by the 8-year rule and therefore
eligible for disability compensation of any kind. By law, service members
determined to be unfit for duty are automatically eligible for disability
compensation if they have at least 8 years of active duty service, even if
their conditions existed prior to entry into the military or were not
aggravated by their military service. However, this entitlement only
applies to reservists when they are on ordered active duty of more than 30
days at the time their case is before a PEB. For reservists, accruing
these 8 years can be more difficult than for active duty service members.

Questions About Line of Duty Determinations

Officials reported that commanders and others responsible for completing
line of duty determinations were often uncertain as to when line of duty
determinations were necessary for reservists and active duty members.
Moreover, these officials noted that in some cases, the necessary line of
duty determinations were not made, resulting in delays for service
members. For example, Air Force officials we spoke with had different
impressions as to whether line of duty determinations were always required
for reservists, even though Air Force regulations state they are.
Officials from the Army and Army National Guard similarly offered
different perspectives on the need for line of duty determinations for
reservists.

Army Reservists Often Are Not Returned Home for Medical Treatment

In the Army, deployed active duty soldiers return to their unit for
service in a back up capacity when they are injured or ill and require
medical treatment. Mobilized injured or ill Army reservists have no
similar unit to return to. Consequently, their mobilization orders are
often suspended; they are retained on active duty in "medical holdover
status" and often assigned to a medical retention processing unit while
they receive medical treatment. While in medical holdover status,
reservists may live on base, at a military treatment facility, at home or
at other locations. After their mobilization orders expire, they can elect
to continue on active duty through a program such as medical retention
processing, which allows them to continue receiving pay and benefits.
According to the Army, about 26,000 reservists entered medical holdover
status between 2003 and 2005.

Unlike most injured active duty soldiers, reservists in medical holdover
generally must live away from their families while receiving medical
treatment. In certain cases reservists in medical holdover may receive
treatment and recuperate at home. The Army's Community Based Health Care
Organizations (CBHCO) provide medical and case management for these
reservists. As of December 2005, about 35 percent of the reservists in
medical holdover were being cared for in the CBHCO program. In order to be
assigned to this program, reservists must meet a number of criteria. For
example, reservists must live in communities where they can get
appropriate care, and they must also be reliable in keeping medical
appointments.

Several Features of the Disability Evaluation System Are Intended to Help Ensure
Consistent Decision Making

To help ensure consistent decision making in disability cases, all
services must use a common rating schedule, multiple reviews are required,
and a disability advisory council was created to oversee administration of
the system. The law requires all services to assign ratings to
disabilities based on a common schedule-the Department of Veterans Affairs
Schedule for Rating Disabilities (VASRD). The VASRD is a descriptive list
of medical conditions associated with disability ratings. DOD regulations
require each service to review service members' case files multiple times
during the disability evaluation process by a number of officials with
different roles. Military officials also regard the appeals process
required by DOD as helping to ensure the consistency of disability
evaluation decision making.

According to DOD officials, primary oversight of the disability evaluation
system currently rests with the DOD Disability Advisory Council. The
council is composed of officials from each of the three services'
disability agency; DOD health affairs, reserve affairs, and personnel
officials; and representatives from the Department of Veterans Affairs.
According to DOD officials, the council serves as a forum to discuss
issues such as changing rules and increasing coordination among the
services. The council generally does not formally report on its activities
and accomplishments to higher officials in the DOD chain of command nor
has it met on a regular basis during the last year.

Lack of Oversight by DOD and the Services Provides Little Assurance Decisions
Are Consistent

Despite this policy guidance and the presence of the disability council,
both DOD and the three services lack quality assurance mechanisms to
ensure that decisions are consistent. Given that one of the primary goals
of the disability system is that disability evaluations take place in a
consistent manner, collecting and analyzing the service member's final
disability determinations are critical for ensuring that decisions are
consistent. DOD regulations recognize this and require that the agency
establish necessary reporting requirements to monitor and assess the
performance of the disability system and compliance with relevant DOD
regulations. Yet DOD does not collect and analyze information from the
services on the final disability determinations and personal
characteristics of service members going through the disability system.

DOD Has Instituted Timeliness Goals for Processing Disability Cases but Does Not
Oversee Compliance with Them

To help ensure timely disability decisions, DOD regulations indicate that
MEBs should normally be completed in 30 days or less; PEBs should normally
be completed in 40 days or less. DOD does not regularly collect available
data from the services on their MEB and PEB processing times, however, so
it does not monitor compliance with its goals.

The Army and Navy generally use the data they compile on their disability
cases to track the timeliness of both MEB and PEB decisions. The Air Force
only tracks processing times for PEB cases because it has no centralized
database containing information from all its MEB cases. Data reported by
the services show disability case processing time goals are not being met.
Some of the military officials we spoke with believe this is because the
goals themselves are unrealistic, particularly when addendums to the MEB's
findings are required, such as in orthopedic or psychiatric cases
requiring certain medical tests.

The usefulness of data of disability case processing times may also be
undermined by confusion among military officials and data entry staff
regarding when the disability evaluation process begins. According to DOD,
the process begins on the date a physician dictates the narrative summary
for an MEB. When we compared original Army PEB case files to Army
electronic data from both its MEB and PEB databases, for example, we found
that the date entered in the electronic file was often not the date on the
narrative summary. When we asked about these errors, Army officials said
that increased training of data entry staff would help resolve this
problem. Navy officials also noted that there was some confusion about
when case processing begins if additional medical information is needed to
make a disability decision for a service member.

DOD's Delegation of Training to the Services and Staff Turnover Present
Additional Challenges for the Disability System

According to DOD regulations, the Assistant Secretary of Defense for
Health Affairs is given explicit instructions to develop and maintain a
training program for MEB and PEB staff. When we spoke with officials from
the Office of Health Affairs, however, they indicated they were unaware
that they had the responsibility to develop such a training program. In
addition, despite high turnover among military disability evaluation
staff, the services do not have a system to ensure that all staff are
properly trained. This turnover stems, in part, from the military
requirement that personnel rotate to different positions in order to be
promoted. Military officials told us that depending on the positions
involved, some staff remain in their positions from 1 to 6 years, with
most remaining about 3 years. This turnover and the resulting loss of
institutional knowledge require that the services systematically track who
has been properly trained. However, all of the services lack data systems
that would allow them to do so, an issue that was highlighted in a recent
RAND report.3

Some Inconsistencies May Exist in Disability Decisions for Army Reserve and
Active Duty Service Members

Our analyses of Army data from calendar years 2001 to 2005 indicated that
after taking into account many of the differences between reserve and
active duty soldiers, Army reservists and their active duty counterparts
received similar disability ratings. The results of our analyses of
military disability benefit decisions for soldiers suggest that Army
reservists with impairments that made them unfit for duty were less likely
to receive either permanent disability retirement or lump sum disability
severance pay than their active duty counterparts. The results of our
analysis of benefits are less definitive than those from our analysis of
ratings, however, because data on all possible reasons for the difference
in receipt of benefits, such as years of service and whether the condition
existed prior to service, were not available for our analysis.

Poor Quality Data Precluded GAO Analysis, but the Army Reports Reservists' Cases
Can Take Longer to Process

We did not conduct our own statistical analysis to determine if processing
times for Army reserve and active duty soldiers' cases were comparable.
The electronic data needed to calculate these times were unreliable, so
not of sufficient quality to warrant their use in our analysis.
Nonetheless, the statistics the Army provided on PEB disability case
processing times indicate that reservists' cases reviewed between fiscal
years 2001 and 2005 took consistently longer than those of active duty
soldiers. Over half (54 percent) of reserve soldiers' cases took longer
than 90 days, while over one-third (35 percent) of active duty soldiers'
cases exceeded 90 days.

According to Army officials, there are a number of possible explanations
for the differences in processing times in reservist and active duty
cases. In reservists' cases, the MEB often must request medical records
from private medical practitioners, which can cause considerable delays in
the process. In addition, the personnel documents for reservists are
stored in facilities around the United States, and may take longer to
retrieve than records for active duty soldiers.

3 Cheryl Y. Marcum, Robert M. Emmerichs, Jennifer S. Sloan, and Harry J.
Thie, Methods and Actions for Improving Performance of the Department of
Defense Disability Evaluation System. MR-1228-OSD (Santa Monica,
California: the Rand Corporation, 2002).

                                  Conclusions

Decisions affecting eligibility for military disability benefits have a
significant impact on the future of service members dedicated to serving
their country. Given the importance of these decisions and the complexity
of the evaluation process and rules governing eligibility for benefits, it
is essential that the services take adequate steps to ensure that
decisions in reserve and active duty cases are consistent and timely. It
is also incumbent on DOD to adequately oversee administration of its
disability evaluation system and the fairness of the system's outcomes for
both reserve and active duty members of the military across all the
services.

DOD is not adequately monitoring disability evaluation outcomes in reserve
and active duty disability cases. The services are not systematically
evaluating the consistency and timeliness of disability decisions, or
compiling reliable data on all aspects of the system needed to
statistically analyze disability evaluation outcomes. With regard to the
timeliness of disability case processing, military officials recognize
that not all disability cases are processed within the time frames set by
DOD and that reservist cases take longer to process than those of active
duty members. They have suggested that the goals may not be appropriate in
many cases. If timeliness goals do not reflect appropriate processing
times, they may not be a useful program management tool. Finally, while
the consistency and timeliness of decisions depend on the adequate
training and experience of all those involved in evaluating disability
cases, we found that DOD had little assurance that staff at all levels in
the process are properly trained.

Based on these findings and conclusions, we recommended in our recent
report that the Secretary of Defense take certain steps to improve DOD
oversight of the military disability system, including evaluating the
appropriateness of timeliness standards for case processing and assessing
the adequacy of training for disability evaluation staff. The Secretary
concurred with our recommendations and indicated our recommendations would
be implemented.

Mr. Chairman, this concludes my remarks. I would be happy to answer any
questions you or the other members of the committee may have.

                                  GAO Contact

Robert E. Robertson (202)512-7215 or [email protected]

                             Staff Acknowledgments

The following individuals have made major contributions to this statement-
Jason Barnosky, Erin Godtland, Scott Heacock, Anna Kelley, and Clarita
Mrena.

130566

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Highlights of GAO-06-561T, a testimony to the Subcommittee on Military
Personnel, House Committee on Armed Services

April 2006

MILITARY DISABILITY EVALUATION

Ensuring Consistent and Timely Outcomes for Reserve and Active Duty
Service Members

The House Subcommittee on Military Personnel asked GAO to discuss the
results of its recent study on the Military Disability Evaluation System.
In this study, GAO determined (1) how current DOD policies and guidance
for disability determinations compare for the Army, Navy, and Air Force,
and what policies are specific to reserve component members of the
military; (2) what oversight and quality control mechanisms are in place
at DOD and these three services of the military to ensure consistent and
timely disability decisions for active and reserve component members As
shown in figure 1,; and (3) how disability decisions, ratings, and
processing times compare for active and reserve component members of the
Army, the largest branch of the service, and what factors might explain
any differences.

What GAO Recommends

In this report, GAO recommended that the Secretary of Defense take certain
steps to improve DOD oversight of the military disability evaluation
system, including evaluating the appropriateness of timeliness standards
for case processing, and assessing the adequacy of training for disability
evaluation staff.

The Secretary concurred and indicated that our recommendations would be
implemented.

In March 2006, GAO reported that policies and guidance for military
disability determinations differ somewhat among the Army, Navy, and Air
Force. DOD has explicitly given the services the responsibility to set up
their own processes for certain aspects of the disability evaluation
system and has given them latitude in how they go about this. As a result,
each service implements its system somewhat differently. Further, the laws
that govern military disability and the policies that the Department of
Defense (DOD) and the services have developed to implement these laws have
led reservists to have different experiences in the disability system
compared to active duty members. For example, because they are not on
active duty at all times, it takes longer for reservists to accrue the 20
years of service that may be needed to earn monthly disability retirement
benefits.

While DOD has issued policies and guidance to promote consistent and
timely disability decisions for active duty and reserve disability cases,
DOD is not monitoring compliance. To encourage consistent decision-making,
DOD requires all services to use multiple reviewers to evaluate disability
cases. Furthermore, federal law requires that they use a standardized
disability rating system to classify the severity of the medical
impairment. In addition, DOD periodically convenes the Disability Advisory
Council, comprised of DOD and service officials, to review and update
disability policy and to discuss current issues. However, neither DOD nor
the services systematically determine the consistency of disability
decision-making. DOD has issued timeliness goals for processing disability
cases, but is not collecting information to determine compliance. Finally,
the consistency and timeliness of decisions depend, in part, on the
training that disability staff receive. However, DOD is not exercising
oversight over training for staff in the disability system.

While GAO's review of the military disability evaluation system's policies
and oversight covered the three services, GAO examined Army data on
disability ratings and benefit decisions from 2001 to 2005. After
controlling for many of the differences between reserve and active duty
soldiers, GAO found that among soldiers who received disability ratings,
the ratings of reservists were comparable to those of active duty soldiers
with similar conditions. GAO's analyses of the military disability benefit
decisions for the soldiers who were determined to be unfit for duty were
less definitive, but suggest that Army reservists were less likely to
receive permanent disability retirement or lump sum disability severance
pay than their active duty counterparts. However, data on possible reasons
for this difference, such as whether the condition existed prior to
service, were not available for our analysis. GAO did not compare
processing times for Army reserve and active duty cases because we found
that Army's data needed to calculate processing times were unreliable.
However, Army statistics based on this data indicate that from fiscal year
2001 through 2005, reservists' cases took longer to process than active
duty cases.
*** End of document. ***