Veterans' Disability Benefits: Claims Processing Challenges	 
Persist, while VA Continues to Take Steps to Address Them	 
(14-FEB-08, GAO-08-473T).					 
                                                                 
The Subcommittee on Disability Assistance and Memorial Affairs,  
House Veterans' Affairs Committee, asked GAO to present its views
on the Department of Veterans Affairs' (VA) disability claims	 
process. This statement discusses (1) claims processing 	 
challenges VA faces, (2) steps VA is taking to address these	 
challenges, and (3) opportunities for more fundamental reform.	 
GAO has reported and testified on this subject on numerous	 
occasions. GAO's work has addressed VA's efforts to improve the  
timeliness and accuracy of decisions on claims, VA's efforts to  
reduce pending claims levels, and concerns about decisional	 
consistency. This testimony is based on a body of past work,	 
updated as appropriate to reflect the current workload and	 
initiatives.							 
-------------------------Indexing Terms------------------------- 
REPORTNUM:   GAO-08-473T					        
    ACCNO:   A80791						        
  TITLE:     Veterans' Disability Benefits: Claims Processing	      
Challenges Persist, while VA Continues to Take Steps to Address  
Them								 
     DATE:   02/14/2008 
  SUBJECT:   Budgeting						 
	     Claims processing					 
	     Compensation claims				 
	     Disability benefits				 
	     Disability insurance				 
	     Military benefits claims				 
	     Military disability retirement pay 		 
	     Strategic planning 				 
	     Veterans						 
	     Veterans benefits					 
	     Veterans disability compensation			 

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GAO-08-473T

   

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Testimony: 

Before the Subcommittee on Disability Assistance and Memorial Affairs, 
Committee on Veterans' Affairs, House of Representatives: 

United States Government Accountability Office: 

GAO: 

For Release on Delivery: 

Expected at 2:00 p.m. EST Thursday, February 14, 2008: 

Veterans' Disability Benefits: 

Claims Processing Challenges Persist, while VA Continues to Take Steps 
to Address Them: 

Statement of Daniel Bertoni, Director: 

Education, Workforce, and Income Security: 

GAO-08-473T: 

GAO Highlights: 

Highlights of GAO-08-473T, a testimony before the Subcommittee on 
Disability Assistance and Memorial Affairs, Committee on Veterans' 
Affairs, House of Representatives. 

Why GAO Did This Study: 

The Subcommittee on Disability Assistance and Memorial Affairs, House 
Veteransï¿½ Affairs Committee, asked GAO to present its views on the 
Department of Veterans Affairsï¿½ (VA) disability claims process. This 
statement discusses (1) claims processing challenges VA faces, (2) 
steps VA is taking to address these challenges, and (3) opportunities 
for more fundamental reform. 

GAO has reported and testified on this subject on numerous occasions. 
GAOï¿½s work has addressed VAï¿½s efforts to improve the timeliness and 
accuracy of decisions on claims, VAï¿½s efforts to reduce pending claims 
levels, and concerns about decisional consistency. This testimony is 
based on a body of past work, updated as appropriate to reflect the 
current workload and initiatives. 

What GAO Found: 

Despite taking steps to improve its disability claims process, VA 
continues to face challenges, specifically in reducing the number of 
claims pending, speeding up the process of deciding claims, and 
improving accuracy and consistency of decisions across regional 
offices. For example, between fiscal years 2003 and 2007, the inventory 
of claims awaiting a decision by VA grew by more than 50 percent to a 
total of about 392,000, and the average number of days claims were 
pending increased by 3 weeks to 132 days. Further, GAO and VAï¿½s 
Inspector General have identified concerns about the consistency of 
decisions across regional offices. Factors affecting VAï¿½s claims-
processing performance may include increases in the number and 
complexity of claims being filed and the potential impacts of laws and 
court decisions. 

VA continues to take steps to help improve claims-processing 
performance, including requesting funding for additional staff. The 
Presidentï¿½s fiscal year 2009 budget request funds an increase of more 
than 2,600 additional full-time equivalent employees over fiscal year 
2007 levels to process claims. 

Figure: Rating-Related Claims Pending at End of Period, Fiscal Years 
2000-2007: 

This figure is a combination bar chart showing rating-related claims 
pending at end of period, fiscal years 2000-2007. The X axis represents 
the fiscal year, and the Y axis represents the claims pending (in 
thousands). One bar represents pending over 6 months, and the other bar 
represents the total pending. 

Fiscal year: 2000; 
Pending over 6 months: 2000: 57; 
Total pending: 228. 

Fiscal year: 2001; 
Pending over 6 months: 2001: 172; 
Total pending: 2001: 421. 

Fiscal year: 2002; 
Pending over 6 months: 2002: 122; 
Total pending: 2002: 346. 

Fiscal year: 2003; 
Pending over 6 months: 2003: 47; 
Total pending: 2003: 254. 

Fiscal year: 2004; 
Pending over 6 months: 2004: 67; 
Total pending: 2004: 321. 

Fiscal year: 2005; 
Pending over 6 months: 2005: 72; 
Total pending: 2005: 346. 

Fiscal year: 2006; 
Pending over 6 months: 2006: 83; 
Total pending: 2006: 378. 

Fiscal year: 2007; 
Pending over 6 months: 2007: 101; 
Total pending: 2005: 392. 

[See PDF for image] 

Source: VA data. 

[End of figure] 

Beyond the steps VA is taking to address its claims processing 
challenges, opportunities for significant performance improvement may 
lie in more fundamental reform of VAï¿½s disability compensation program. 
Such reforms could include reexamining program design such as updating 
the disability criteria to reflect the current state of science, 
medicine, technology, and labor market conditions. It could also 
include examining the structure and division of labor among field 
offices. Recent studies conducted by presidential and congressionally 
appointed commissions have recommended some fundamental changes, 
including updating VAï¿½s rating schedule, which provides the basis for 
decisions about eligibility for benefits. 

To view the full product, including the scope and methodology, click on 
[hyperlink, http://www.GAO-08-473T. For more information, contact 
Daniel Bertoni at (202) 512-7215 or [email protected]. 

[End of section] 

Mr. Chairman and Members of the Committee: 

I am pleased to have the opportunity to comment on the claims- 
processing challenges and opportunities facing the Department of 
Veterans Affairs' (VA) disability compensation and pension programs. 
Through these programs, VA provided about $37.5 billion in cash 
disability benefits to more than 3.6 million veterans and their 
survivors in fiscal year 2007. For years, the claims process has been 
the subject of concern and attention by VA, Congress, and veterans 
service organizations, due in large part to long waits for decisions 
and large numbers of claims pending a decision. Further, we and VA's 
Inspector General have identified concerns about the consistency of 
decisions across regional offices. These concerns have continued and 
been magnified as veterans of the conflicts in Iraq and Afghanistan, 
and survivors of service members who have died in those conflicts face 
similar issues as they seek VA disability benefits. In January 2003, we 
designated modernizing VA and other federal disability programs as a 
high-risk area, because of these service delivery challenges, and 
because our work over the past decade has found that these programs are 
based on outmoded concepts from the past. More recently, the President 
and Congress established commissions to study VA's disability 
compensation system. 

You asked us to discuss our views on VA's disability claims process. 
Specifically, my statement today addresses (1) claims processing 
challenges VA faces, (2) steps VA is taking to address these challenges 
and (3) opportunities for more fundamental reform. My statement draws 
on a number of prior GAO reports and testimonies that were conducted in 
accordance with generally accepted government auditing standards. (See 
related GAO products.) We updated information as appropriate to reflect 
the current status of VA claims processing workload and initiatives. 

In summary, despite taking steps to improve its processing of 
disability claims, VA continues to face challenges, specifically in 
speeding up the process of deciding claims, reducing the number of 
claims pending, and improving the accuracy and consistency of decisions 
across regional offices. For example, between fiscal years 2003 and 
2007, the inventory of claims awaiting a decision grew by more than 50 
percent to a total of about 392,000, in part because of increased 
filing of claims, including those filed by veterans of the Iraq and 
Afghanistan conflicts and from VA's increased outreach to 
veterans.[Footnote 1] During the same period, the average number of 
days these claims were pending increased by 21 days, to an average of 
132 days. Further, we and VA's Inspector General have identified 
concerns about the consistency of decisions across regional offices. 
Some of the factors affecting VA's claims processing performance may 
include increases in the number and complexity of claims being filed 
such as those for post-traumatic stress disorder (PTSD), reopening of 
existing claims, and the potential impacts of laws and court decisions. 
VA has taken a number of steps to help improve claims processing 
performance, including requesting funding for additional staff, 
establishing "tiger teams" to help process certain claims, and 
expediting the processing of claims filed by veterans of Operation 
Iraqi Freedom (OIF) and Operation Enduring Freedom (OEF). The 
President's fiscal year 2009 budget request funds an increase of over 
2,600 full-time equivalent employees from actual fiscal year 2007 
levels to process compensation claims. While the infusion of a large 
number of staff has the potential of increasing VA's claims processing 
capacity, quickly absorbing these many staff will likely present human 
capital challenges for VA such as how to develop, train, and deploy 
them. 

Beyond the steps VA is taking, opportunities for significant 
performance improvement may lie in more fundamental reform of VA's 
disability compensation program. This would include reexamining program 
design as well as the structure and division of labor among field 
offices. For example, after more than a decade of research, we have 
found that VA's and other federal disability programs have not been 
updated to reflect the current state of science, medicine, technology, 
and labor market conditions. More specifically, VA's rating schedule, 
upon which disability decisions are made, is based primarily on 
estimates made in 1945 about the effect of service-connected 
impairments on the average individual's ability to perform jobs 
requiring manual labor. We and at least two recent commissions--the 
President's Commission on Care for America's Returning Wounded 
Warriors, commonly referred to as the Dole-Shalala Commission, and the 
Veterans' Disability Benefits Commission--appointed to study VA's 
disability compensation system, have recommended updating VA's rating 
schedule, among other fundamental reforms. 

Background: 

VA pays monthly disability compensation benefits to veterans with 
service-connected disabilities (injuries or diseases incurred or 
aggravated while on active military duty) according to the severity of 
the disability. VA also pays additional compensation for some 
dependents--spouses, children, and parents-of veterans.[Footnote 2] 
VA's pension program pays monthly benefits based on financial need to 
certain wartime veterans or their survivors.[Footnote 3] 

When a veteran submits a claim to any of the Veterans Benefits 
Administration's (VBA) 57 regional offices, a veterans service 
representative is responsible for obtaining the relevant evidence to 
evaluate the claim. Such evidence includes veterans' military service 
records, medical examinations, and treatment records from VA medical 
facilities and private medical service providers. Once a claim has all 
the necessary evidence, a rating specialist evaluates the claim and 
determines whether the claimant is eligible for benefits. If the 
veteran is eligible for disability compensation, the rating specialist 
assigns a percentage rating based on degree of disability. A veteran 
who disagrees with the regional office's decision can appeal to VA's 
Board of Veterans' Appeals and then to U.S. federal courts.[Footnote 4] 

VA Continues to Face Challenges in Improving Its Claims Processing: 

VA continues to experience significant service delivery challenges-- 
large pending workloads, lengthy processing times, and inaccurate and 
inconsistent decisions. A number of factors contribute to these 
challenges, such as an increase in the numbers and complexity of the 
claims veterans are filing and the effects of recent laws and court 
decisions. These factors have eroded some of the earlier gains VA made 
in reducing claims backlogs. For example, VA made progress in fiscal 
years 2002 and 2003 reducing the size and age of its pending claims 
inventory, but it has lost ground since then. 

VA's inventory of claims awaiting a decision and their average time 
pending has increased significantly in the last 4 years, in part 
because of an increase in the number of claims received. The number of 
pending claims increased by more than 50 percent from the end of fiscal 
year 2003 to the end of fiscal year 2007 to about 392,000. During the 
same period, the number of claims pending longer than 6 months more 
than doubled from about 47,000 to about 101,000 (see fig. 1). 

Figure 1: Rating-Related Claims Pending at End of Period, Fiscal Years 
2000-2007: 

This figure is a combination bar chart showing rating-related claims 
pending at end of period, fiscal years 2000-2007. The X axis represents 
the fiscal year, and the Y axis represents the claims pending (in 
thousands). One bar represents pending over 6 months, and the other bar 
represents the total pending. 

Fiscal year: 2000; 
Pending over 6 months: 2000: 57; 
Total pending: 228. 

Fiscal year: 2001; 
Pending over 6 months: 2001: 172; 
Total pending: 2001: 421. 

Fiscal year: 2002; 
Pending over 6 months: 2002: 122; 
Total pending: 2002: 346. 

Fiscal year: 2003; 
Pending over 6 months: 2003: 47; 
Total pending: 2003: 254. 

Fiscal year: 2004; 
Pending over 6 months: 2004: 67; 
Total pending: 2004: 321. 

Fiscal year: 2005; 
Pending over 6 months: 2005: 72; 
Total pending: 2005: 346. 

Fiscal year: 2006; 
Pending over 6 months: 2006: 83; 
Total pending: 2006: 378. 

Fiscal year: 2007; 
Pending over 6 months: 2007: 101; 
Total pending: 2005: 392. 

[See PDF for image] 

Source: VA data. 

[End of figure] 

Similarly, while VA reduced the average number of days claims were 
pending from a high of 182 days at the end of fiscal year 2001 to 111 
days at the end of fiscal year 2003, the average age of pending claims 
crept back up to 132 days by the end of fiscal year 2007, as shown in 
figure 2. 

Figure 2: Average Days Pending for VA Compensation and Pension Rating- 
Related Claims, Fiscal Years 2000-2007: 

This figure is a bar chart showing average days pending for VA 
compensation and pension rating-related claims, fiscal years 2000 
through 2007. 

2000: 138; 
2001: 182; 
2002: 174; 
2003: 111; 
2004: 118; 
2005: 120; 
2006: 127; 
2007: 132. 

[See PDF for image] 

Source: VA data. 

[End of figure] 

A number of factors are contributing to this increase in VA's inventory 
of pending claims, and their average time pending. First, there has 
been a steady increase in the number of claims filed--including those 
filed by veterans of the Iraq and Afghanistan conflicts--from about 
579,000 in fiscal year 2000 to about 838,000 in fiscal year 2007, an 
increase of about 45 percent. VA projects claims receipts to increase 
to about 872,000 in fiscal year 2009 and cautions that ongoing 
hostilities in Iraq and Afghanistan, and the Global War on Terror in 
general, may further increase its workload. VA also attributes 
increased claims receipts to its efforts to increase outreach to 
veterans and service members. For example, VA reports that in fiscal 
year 2006, it provided benefits briefings to about 393,000 separating 
service members, up from about 210,000 in fiscal year 2003. VA has also 
noted that the number of veterans receiving compensation has increased 
by about a half million from fiscal years 2000 to 2007. VA anticipates 
the number of reopened claims will increase as compensation recipients-
-many of whom suffer from chronic progressive disabilities such as 
diabetes, mental illness, and cardiovascular disabilities--reopen 
claims for increased benefits as they age and their conditions worsen. 

Another factor affecting processing times is the complexity of cases, 
in both terms of numbers and types of disabilities veterans are 
claiming. According to VA, some veterans are citing more disabilities 
in their claims than in the past and these claims can take longer to 
complete because each disability needs to be evaluated separately. VA 
reported that the number of cases with eight or more disabilities 
claimed increased by 168 percent--from about 21,800 to about 58,500-- 
from 2000 to 2007. Additionally, VA notes that it is receiving claims 
for new and complex disabilities related to combat and deployments 
overseas, including those based on environmental and infectious disease 
risks and traumatic brain injuries. Further, VA reports receiving 
increasing numbers of claims for compensation for PTSD, which is 
generally more difficult to evaluate, in part because of the evidence 
required to link the disorder to a particular event. According to VA, 
from 1999 through 2007, the number of veterans receiving compensation 
benefits for PTSD increased from 120,000 to nearly 300,000. 

Further, a number of statutes[Footnote 5] and court decisions[Footnote 
6] related to VA's disability claims process have affected VA's ability 
to process claims in a timely manner. For example, VA stated that the 
Veterans Claims Assistance Act of 2000 significantly increased the 
length and complexity of claims development by adding more steps to the 
process and lengthening the time it takes to develop and decide a 
claim. VA also notes that legislation and VA regulations have expanded 
benefit entitlement, adding to the volume of claims. In recent years, 
statutes have created new presumptions of service-connected 
disabilities for many Vietnam veterans and former prisoners of 
war.[Footnote 7] Also, VA expects additional claims receipts following 
enactment of legislation that allows certain military retirees to 
receive both military retirement pay and VA disability 
compensation.[Footnote 8] 

VA Continues to Take Steps to Improve Claims Processing: 

VA is taking several steps to improve claims processing. Some near-term 
initiatives include the increased use of overtime and use of retired VA 
employees to provide training and to assist in processing claims. VA 
reported it currently employs 70 rehired annuitants. VA expects these 
annuitants to complete 23,000 rating decisions in 2008. VA has also 
used other initiatives such as brokering claims between offices to help 
manage its claims inventory and establishing special teams to assist in 
the processing of claims. For example, VA established teams to process 
disability claims for veterans 70 years and older and for expediting 
claims of OIF and OEF veterans. In 2007, VA announced an initiative to 
provide priority processing of disability claims for all OIF and OEF 
veterans', including active duty, National Guard, and reservists. 

In VA's fiscal year 2009 budget justification, an increase in claims 
processing staff was identified as essential to reducing the pending 
claims inventory and improving timeliness. The fiscal year 2009 request 
would fund 10,998 full-time equivalent employees working on 
compensation and pension claims, and represents an increase of about 
2,600 positions, or 32 percent over fiscal year 2007. In keeping with 
our prior recommendation, VA's budget justification provides 
information on actual and planned productivity, in terms of claims 
decided per full-time equivalent employee. While VA expects a temporary 
decline in productivity in fiscal year 2008 as new staff are trained 
and become more experienced, it expects productivity to increase in the 
longer term. VA is modifying its centralized training program to focus 
newly hired employees on processing burial and dependency claims. VA 
reports this will allow them to become productive more quickly, while 
enabling more experienced staff to focus on disability claims 
processing. However, incorporating the large number of new employees 
into the disability claims process will likely present human capital 
challenges for VA. For example, VA would have to adequately train them. 
For staff who decide claims, it is estimated that this could take 1 to 
2 years. VA would also have to determine where these staff should be 
deployed. 

Even as staffing levels increase, however, VA acknowledges that it 
still must take other actions to improve productivity.[Footnote 9] For 
example, VA added more locations where service members can initiate the 
VA disability claims process up to 180 days prior to separating from 
the service. VA reports that these locations, known as Benefits 
Delivery at Discharge sites, now total 140. The goal of the program is 
to provide benefits within 60 days following discharge. In addition, VA 
also plans to pilot paperless Benefits Delivery at Discharge, where 
service members' disability claim applications, service medical 
records, and other evidence would be captured electronically prior to 
discharge. VA expects this new process will reduce the time needed to 
gather evidence for deciding claims. GAO currently has work underway 
looking at the Benefits Delivery at Discharge program. 

Another step to improve claims processing is a pilot program by VA and 
the Department of Defense (DOD) in which VA completes disability 
ratings for service members who have been found unfit for duty due to 
disability by the military services. The goal of the pilot program is 
to deliver faster and more consistent disability evaluations and 
compensation to service members and veterans. Because VA rates 
disabilities while the service member is still in the military service, 
disability benefits can be awarded soon after the service member is 
discharged. GAO is currently studying this pilot. 

In addition to challenges with managing pending claims inventories and 
deciding claims in a timely manner, VA acknowledges that regional 
office decisional accuracy needs further improvement. VA reports that 
it improved the accuracy of decisions on rating-related compensation 
claims from 80 percent in fiscal year 2002 to 88 percent in fiscal year 
2007. However, this figure remains short of its current strategic goal 
of 98 percent. In March 2007, VA stated it had established an 
aggressive quality assurance program to assess rating, authorization, 
and fiduciary program accuracy. Additionally, VA plans to begin routine 
quarterly monitoring of compensation and pension cases by diagnostic 
code and to expand quality review staff to complete additional reviews. 

VA also continues to face questions about its ability to ensure that 
veterans receive consistent decisions across regional offices. We have 
identified the need for VA to systematically address this issue to 
achieve acceptable levels of variation.[Footnote 10] VA's Inspector 
General has studied one indicator of possible inconsistency, which is a 
wide variation in average payments per veteran from state to state. In 
May 2005, the Inspector General reported that variation in rating 
decisions was more likely to occur for some disabilities like PTSD than 
for others, where much of the information needed to make a 
determination is susceptible to interpretation and judgment. To improve 
decision consistency, VA conducted a pilot project to monitor 
consistency of rating-related claims decisions. VA also conducted a 
consistency review of post-traumatic stress disorder claims. Finally, 
VA deployed 58 computerized exam templates for each type of 
compensation and pension exam to each Veterans Health Administration 
compensation and pension exam site to improve the quality of medical 
exams used to make rating decisions. 

Opportunities for Improvement May Lie in More Fundamental Reform: 

While VA is taking actions to address its claims processing challenges, 
there are opportunities for more fundamental program reform such as 
reexamining program design and the structure and division of labor 
among field offices. 

After more than a decade of research, we have determined that federal 
disability programs, including VA's disability program, are in urgent 
need of attention and transformation and placed modernizing federal 
disability programs on our high-risk list in January 2003.[Footnote 11] 
Specifically, our research showed that the disability programs 
administered by VA and the Social Security Administration (SSA) lag 
behind the scientific advances and economic and social changes that 
have redefined the relationship between impairments and work. For 
instance, advances in medicine and technology have reduced the severity 
of some medical conditions and have allowed individuals to live with 
greater independence and function in work settings. Moreover, the 
nature of work has changed in recent decades as the national economy 
has moved away from manufacturing-based jobs to service-and knowledge- 
based employment. At the same time, impairments such as traumatic brain 
injury have become more prevalent. Yet VA's and SSA's disability 
programs remain mired in concepts from the past--particularly the 
concept that impairment equates to an inability to work--and as such, 
we found that these programs are poorly positioned to provide 
meaningful and timely support for Americans with disabilities. We 
currently are assessing the challenges VA faces in providing vocational 
rehabilitation and employment services to current beneficiaries as well 
as the large number of service members returning from the OIF and OEF 
conflicts in need of such services. 

In prior work, we recommended that VA use its annual performance plan 
to delineate strategies for and progress in periodically updating labor 
market data used in its disability determination process.[Footnote 12] 
We also recommended that VA study and report to Congress on the effects 
that a comprehensive consideration of medical treatment and assistive 
technologies would have on its disability programs' eligibility 
criteria and benefits package. This study would include estimates of 
the effects on the size, cost, and management of VA's disability 
programs and other relevant VA programs and would identify any 
legislative actions needed to initiate and fund such changes. 

In its October 2007 report, the Veterans' Disability Benefits 
Commission (VDBC)--established by Congress in 2003 to study the 
appropriateness of VA disability benefits[Footnote 13]--also pointed 
out that VA's eligibility criteria were outdated and recommended that 
the VA Rating Schedule be reviewed and updated. The commission further 
recommended the schedule be reviewed and updated on a frequent basis 
and that first priority be given to revising the mental health and 
neurological body systems to expeditiously address post traumatic 
stress disorder, other mental disorders, and traumatic brain injury. 

In its July 2007 report, the Dole-Shalala Commission also recommended 
updating VA's rating schedule. The commission reported that VA's rating 
schedule is outdated and does not include diagnostic criteria for 
injuries that are new or for which diagnostic criteria are changing 
rapidly, such as traumatic brain injury. Further, the commission 
pointed out that VA's rating schedule fails to acknowledge the 
disabling impact of conditions such as PTSD, and the effect medical 
advances have on the prognosis for certain conditions such as serious 
burns and amputations. 

VA is in the process of addressing some of our and the commission's 
concerns. For example, VA is modifying the rating schedule to provide 
detailed and updated criteria for evaluating traumatic brain injury and 
the potential effect of medical advances on certain conditions. In 
January 2008, VA announced that it had contracted for a study of the 
appropriate level of compensation for any loss of earnings capacity 
caused by service-incurred or service aggravated conditions. 

In addition to program design, VA's regional office claims processing 
structure may be disadvantageous to efficient operations. VBA and 
others who have studied claims processing have suggested that 
consolidating claims processing into fewer regional offices could help 
improve claims-processing efficiency and save overhead costs. We noted 
in December 2005 that VA had made piecemeal changes to its claims- 
processing field structure. For example, VA consolidated decision 
making on certain claims--Benefits Delivery at Discharge claims, which 
are generally original claims for disability compensation--at two 
regional offices (Salt Lake City, Utah and Winston-Salem, North 
Carolina). VA also consolidated in-service dependency and indemnity 
compensation claims at the Philadelphia regional office. These claims 
are filed by survivors of service members who die while in military 
service.[Footnote 14] VA consolidated these claims as part of its 
efforts to provide expedited service to survivors, including service 
members who died in Operations Iraqi Freedom and Enduring Freedom. 
Despite these initiatives, VA has not changed its basic field structure 
for processing disability claims at 57 regional offices, which have 
large variations in performance. Unless more comprehensive and 
strategic changes are made to its field structure, VBA is likely to 
miss opportunities to substantially improve productivity, especially in 
the face of future workload increases. We have recommended that VA 
undertake a comprehensive review of its field structure for processing 
disability compensation and pension claims.[Footnote 15] Undertaking 
such a review is especially critical, since VA will need to determine 
how and where to deploy the 2,600 new staff that may be coming on board 
between fiscal years 2007 to 2009 to address its claims processing 
challenges. 

In conclusion, reexamining claims-processing challenges and finding 
viable solutions are daunting tasks. While VA has taken a number of 
steps to improve its disability claims process, challenges persist. 
Opportunities may lie in more fundamental reform. A number of recent 
studies by commissions, GAO, and others have laid the groundwork and 
made many recommendations for addressing current workload challenges 
and redesigning the current program to better align it with modern 
concepts of disability and support services. However, as we move 
forward, it is imperative that VA adequately assess its options for 
improving its disability compensation program and their potential 
effects. It is also important that VA continue to look for other 
fundamental reforms that may be needed to improve its disability 
program for the longer term. 

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

GAO Contact and Acknowledgments: 

For further information, please contact Daniel Bertoni at (202) 512- 
7215 or [email protected]. Also contributing to this statement were 
Shelia Drake, Martin Scire, Kate van Gelder, and Rachael Valliere. 

[End of section] 

Related GAO Products: 

DOD and VA: Preliminary Observations on Efforts to Improve Health Care 
and Disability Evaluations for Returning Servicemembers. GAO-07-1256T. 
Washington, D.C.: September 26, 2007. 

Veterans' Disability Benefits: Processing of Claims Continues to 
Present Challenges. GAO-07-562T. Washington, D.C.: March 13, 2007. 

Veterans' Disability Benefits: Long-Standing Claims Processing Problems 
Persist. GAO-07-512T. Washington, D.C.: March 7, 2007. 

High Risk Series: An Update. GAO-07-310. Washington, D.C.: January 31, 
2007. 

Veterans' Disability Benefits: VA Can Improve Its Procedures for 
Obtaining Military Service Records. GAO-07-98. Washington, D.C.: 
December 12, 2006. 

Veterans' Benefits: Further Changes in VBA's Field Office Structure 
Could Help Improve Disability Claims Processing. GAO-06-149. 
Washington, D.C.: December 9, 2005. 

Veterans' Disability Benefits: Claims Processing Challenges and 
Opportunities for Improvements. GAO-06-283T. Washington, D.C.: December 
7, 2005. 

Veterans' Disability Benefits: Improved Transparency Needed to 
Facilitate Oversight of VBA's Compensation and Pension Staffing Levels. 
GAO-06-225T. Washington, D.C.: November 3, 2005. 

VA Benefits: Other Programs May Provide Lessons for Improving 
Individual Unemployability Assessments. GAO-06-207T. Washington, D.C.: 
October 27, 2005. 

Veterans' Disability Benefits: Claims Processing Problems Persist and 
Major Performance Improvements May Be Difficult. GAO-05-749T. 
Washington, DC.: May 26, 2005. 

VA Disability Benefits: Board of Veterans' Appeals Has Made 
Improvements in Quality Assurance, but Challenges Remain for VA in 
Assuring Consistency. GAO-05-655T. Washington, D.C.: May 5, 2005. 

Veterans Benefits: VA Needs Plan for Assessing Consistency of 
Decisions. GAO-05-99. Washington, D.C.: November 19, 2004. 

Veterans' Benefits: More Transparency Needed to Improve Oversight of 
VBA's Compensation and Pension Staffing Levels. GAO-05-47. Washington, 
D.C.: November 15, 2004. 

Veterans' Benefits: Improvements Needed in the Reporting and Use of 
Data on the Accuracy of Disability Claims Decisions. GAO-03-1045. 
Washington, D.C.: September 30, 2003. 

Department of Veterans Affairs: Key Management Challenges in Health and 
Disability Programs. GAO-03-756T. Washington, D.C.: May 8, 2003. 

Veterans Benefits Administration: Better Collection and Analysis of 
Attrition Data Needed to Enhance Workforce Planning. GAO-03-491. 
Washington, D.C.: April 28, 2003. 

Veterans' Benefits: Claims Processing Timeliness Performance Measures 
Could Be Improved. GAO-03-282. Washington, D.C.: December 19, 2002. 

Veterans' Benefits: Quality Assurance for Disability Claims and Appeals 
Processing Can Be Further Improved. GAO-02-806. Washington, D.C.: 
August 16, 2002. 

Veterans' Benefits: VBA's Efforts to Implement the Veterans Claims 
Assistance Act Need Further Monitoring. GAO-02-412. Washington, D.C.: 
July 1, 2002. 

Veterans' Benefits: Despite Recent Improvements, Meeting Claims 
Processing Goals Will Be Challenging. GAO-02-645T. Washington, D.C.: 
April 26, 2002. 

Veterans Benefits Administration: Problems and Challenges Facing 
Disability Claims Processing. GAO/T-HEHS/AIMD-00-146. Washington, D.C.: 
May 18, 2000. 

[End of section] 

Footnotes: 

[1] Rating-related claims are primarily original claims for disability 
compensation and pension benefits, and reopened claims. For example, 
veterans may file reopened claims if they believe their service- 
connected conditions have worsened. 

[2] 38 U.S.C. ï¿½ 1115 provides for payment of additional benefits for 
qualifying dependents of veterans whose disability is rated not less 
than 30 percent. 

[3] Veterans qualify for pensions for non-service connected disability 
if they have low income, served in a period of war, and are permanently 
and totally disabled for reasons not service-connected (or are aged 65 
or older). 38 U.S.C. ï¿½ 1521 and 38 U.S.C. ï¿½ 1513. 

[4] Appeals from the Board of Veterans Appeals go to the U.S. Court of 
Appeals for Veterans Claims, and finally to the U.S. Court of Appeals 
for the Federal Circuit, under certain circumstances. 

[5] Veterans Benefits Improvement Act of 2004, Pub. L. No.108-454; 
Veterans Benefits Act of 2003, Pub. L. No. 108-183; Veterans Claims 
Assistance Act of 2000, Pub. L. No. 106-475. 

[6] See e.g., Moody v. Principi, 360 F.3d. 1306 (Fed. Cir. 2004); 
Szemraj v. Principi, 357 F.3d 1370 (Fed. Cir. 2004); Disabled American 
Veterans v. Secretary of Veterans Affairs, 327 F.3d 1339 (Fed. Cir. 
2003). 

[7] For example, the Agent Orange Act of 1991, Pub. L. No. 102-4, 
broadens the presumption of exposure to herbicides in Vietnam. See 
also, 38 C.F.R. ï¿½ 3.309 (diseases subject to a presumptive service 
connection). 

[8] National Defense Authorization Act for Fiscal Year 2004, Pub. L. 
No. 108-136, Div. A. tit VI, ï¿½ 641, amending 10 U.S.C. ï¿½ 1414. 

[9] See GAO, Veterans' Benefits: More Transparency Needed to Improve 
Oversight of VBA's Compensation and Pension Staffing Levels, GAO-05-47 
(Washington, D.C.: Nov. 15, 2004). 

[10] GAO, Veterans' Benefits: Quality Assurance for Disability Claims 
and Appeals Processing Can Be Further Improved, GAO-02-806 (Washington, 
D.C.: Aug. 16, 2002); and Veterans Benefits: VA Needs Plan for 
Assessing Consistency of Decisions, GAO-05-99 (Washington, D.C.: Nov. 
19, 2004). 

[11] GAO, High Risk Series: An Update, GAO-03-119 (Washington, D.C.: 
Jan. 2003). 

[12] GAO, SSA and VA Disability Programs: Re-examination of Disability 
Criteria Needed to Help Ensure Program Integrity, GAO-02-597 
(Washington D.C.: Aug. 9, 2002). 

[13] National Defense Authorization Act for Fiscal Year 2004. 

[14] VBA also provides dependency and indemnity compensation to 
survivors of certain deceased disability compensation beneficiaries. 38 
U.S.C. ï¿½ï¿½ 1541,1542. 

[15] GAO, Veterans' Benefits: Further Changes in VBA's Field Office 
Structure Could Help Improve Disability Claims Processing. GAO-06-149 
(Washington, D.C.: Dec. 9, 2005). 

[End of section] 

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