HOUSE COMMITTEE ON VETERANS’ AFFAIRS
SUBCOMMITTEE ON DISABILITY ASSISTANCE AND MEMORIAL AFFAIRS
FEBRUARY 3, 2010
STATEMENT OF BRADLEY G. MAYES
DIRECTOR, COMPENSATION AND PENSION SERVICE,
VETERANS BENEFITS ADMINISTRATION, U.S. DEPARTMENT OF VETERANS AFFAIRS
February 3, 2010
Chairman Hall and Subcommittee Members, thank you for providing me with this opportunity to address the progress made by the Department of Veterans Affairs (VA) towards implementing the provisions of Public Law 110-389, the Veterans’ Benefits Improvement Act of 2008. Both VA and the Congress are acutely aware of the enormous challenges we face in improving and expediting our claims process. We are grateful for your input and for the opportunity to evaluate pilot programs to see if they help us meet our end goal, of serving the Veterans who have served us.
I regret that some of the reports required by Public Law 110-389 are overdue, and I would like to share the reasons for these delays. Because of the importance of these issues, we are proceeding deliberately on these often-complex matters. In some cases the need to obtain outside expertise, and to duly consider the advice obtained, has had to come at the expense of speed. Let me discuss each relevant section and explain how we have addressed it.
Sec. 101 – Regulation on Contents of Notice to be Provided Claimants Regarding Substantiation of Claim
Under this section, Congress required the Secretary to prescribe in regulations the contents of the notice to be provided to claimants for VA benefits pursuant to 38 U.S.C. 5103. The amended regulation must: (1) specify the different content for notices based on whether the claim is original, a claim to reopen a prior decision, or a claim for increased benefits; (2) provide that the content of such notices be appropriate to the type of benefit or service sought under the claim; and (3) specify for each type of claim the general information and evidence required to substantiate the basic elements of the claim type.
In order to comply with this requirement, VA developed appropriate regulation language and published it as a proposed rulemaking in the Federal Register on December 11, 2009. The period for public comment ends on February 9, 2010. At the close of the comment period, we will review the comments and consider whether any revisions to the proposed regulation are warranted. Following that, a final regulation will be published in the Federal Register.
Sec. 104 – Report on Causes for Variance in Compensation Payments
Under this section, Congress required the Secretary to report on efforts to address perceived patterns of nationwide variance in disability compensation payments provided to Veterans. The report’s content was to include three elements: (1) a description of efforts jointly undertaken by the Veterans Benefits Administration (VBA) and the Veterans Health Administration (VHA), including contract clinicians, to improve the quality of medical examinations provided to Veterans seeking disability compensation; (2) an assessment of current VBA personnel adequacy and requirements for claims adjudication; and (3) a description of any differences in disability claims adjudication outcomes for various populations of Veterans. Separate reports for each of the three elements have been completed and are undergoing final administrative review prior to submission. I sincerely apologize for the delay in complying with the requirements of this section of the law.
Addressing the first element involved an internal review of actions taken to improve the Compensation and Pension Examination Program (CPEP). Addressing the second and third elements involved contracting with the Institute for Defense Analyses (IDA) for relevant studies. The cost for these studies amounted to $1.7 million. I look forward to sharing the full contents of these reports with you soon.
Sec. 213 – Report on Compensation for Veterans’ Earning Capacity Loss and Quality of Life Loss and on Long Term Transition Payments for Disability Rehabilitation
Under this section, Congress required the Secretary to provide a report on his findings as a result of studies of: (1) the appropriate levels of disability compensation for loss in earning capacity and loss of quality of life as a result of service-connected disability; and (2) the feasibility of providing and appropriate levels of long-term transitional benefits for Veterans separated from the Armed Forces due to disability while they undergo rehabilitation. This report has been provided to Congress. The report is based on the findings of Economic Systems, Inc. (EconSys), which was contracted by VA to study these areas of Congressional concern. VA previously provided testimony on the EconSys study during a DAMA Subcommittee hearing on July 23, 2009. Those views are contained in VA's prepared statement and testimony presented at that time.
Sec. 221 – Pilot Programs on Expedited Claims and Checklists
Under this section, Congress required the Secretary to conduct pilot programs to evaluate expedited treatment of fully developed claims (FDC) and the value of providing checklists to Veterans submitting claims. The FDC pilot is designed to reduce claims processing to 90 days when the Veteran claimant has provided a signed certification form stating that “no additional information or evidence is available or needs to be submitted in order for the claim to be adjudicated.” The checklist project is designed to encourage more complete and timelier submission of evidence from Veteran claimants as an additional means to reduce claims processing time. VA contracted with the Center for Naval Analyses (CNA) to review and evaluate the effectiveness of both pilot programs at a cost of $1.5 million.
For the FDC pilot, VA developed methods for implementation, which include providing Veterans with a certification form and tracking the progress of the FDC claims involved. Regional offices at Boise, Boston, Chicago, Columbia, Denver, Manchester, Milwaukee, Montgomery, Portland, and Providence were selected to conduct the pilot. In addition, VA notified all regional offices of the pilot through a Fast Letter released in December 2008, which explained the implementation procedures. The CNA study of the pilot involved field visits and will focus on claims filed between December 2008 and December 2009. The study will analyze whether the 90-day claims processing time is feasible and, if not, will identify those specific barriers to swift adjudication that are most difficult to overcome. In August 2009, CNA produced its Interim Evaluation of Fully Developed Claims Pilot Program, which has been provided to Congress. CNA noted that, although preliminary in nature, the study thus far indicates that expediting the processing of FDC claims results in faster processing time for such claims and does not negatively impact the processing of non-FDC claims. A final CNA evaluation report will be provided to Congress at the conclusion of the pilot program. The report is due on June 7, 2010, and the data analysis is on schedule.
The checklist pilot is designed to alleviate potential confusion that Veterans may experience with the detailed notification letters that VA is obligated by law to provide when a disability claim is received. The checklist is intended to summarize the information and evidence required to substantiate the claim in an easy-to-read format. The pilot consists of two phases. Phase I involves original claims filed between December 2008 and December 2009, and Phase II involves reopened claims and claims for increased disability filed between December 2008 and December 2011. Regional offices at Boise, Cleveland, Louisville, and Waco were chosen to conduct the pilot. In December 2008 VA notified all regional offices of the pilot through a Fast Letter, which explained the implementation procedures. The CNA study is applying quantitative and qualitative analytical methods and will compare processing timeliness of claims using the checklists to claims without it. In August 2009, CNA produced its First Interim Evaluation of Individual Claimant Checklist Pilot Program, which has been provided to Congress. CNA noted that its preliminary evaluation was incomplete due to receiving data only on closed claims, but not pending claims, and cautioned against drawing any conclusions on the effectiveness of the pilot at this time. A second interim CNA report is due on September 10, 2011, and is on schedule. The due date for the final CNA evaluation report to be provided to Congress is June 6, 2012.
Sec. 222 – Office of Survivors Assistance
This section requires the Secretary to establish an Office of Survivors Assistance to serve as a resource regarding all benefits and services related to survivors and dependents of deceased Veterans and deceased servicemembers.
The Office was established in December 2008, was provided the necessary resources to carry out its responsibilities, and by February 2009 was fully staffed and operational. As part of the Secretary’s Executive Leadership Board and the VA Strategic Communications Group, the Office has been able to begin fulfilling its role as a primary advisor to the Secretary on all matters related to the policies, programs, legislative issues, and other initiatives affecting survivors.
In the past year the Office has been directly involved in advocating survivor issues to shareholders both internal and external to VA. The Office was a key driver in the addition of the term “survivors” to the title of the informational 2009 Federal Benefits for Veterans, Dependents and Survivors book. Along with this change the Office also spearheaded updates to the benefits book by clarifying the language regarding bereavement counseling for survivors; this change will ultimately make counseling more accessible for all survivors. The Office also established multiple partnerships with DoD agencies and Veteran Service Organizations to explore ways to ease the transition of survivors into the VA system. The Office also created and maintains a website to help survivors navigate through the survivor resources that may be available to them. The Office will continue to monitor policy and legislative issues as well as pursue outreach to survivors to ensure that survivor issues are fully understood and addressed at the appropriate level.
Sec. 224 – Independent Assessment of Quality Assurance Program
This section amends 38 U.S.C. 7731, which requires the Secretary to carry out a quality assurance program within VBA that meets “generally applicable governmental standards for independence and internal controls for the performance of quality reviews of Government performance and results.” As amended, this statute now requires VA to “enter into a contract with an independent third-party entity to conduct, during the three-year period beginning on the date of the enactment of the Veterans’ Benefits Improvement Act of 2008, an assessment of the quality assurance program.” This assessment is required to evaluate the following: (1) the quality and accuracy of the work of VBA employees, using a statistically valid sample of such employees and a statistically valid sample of such work; (2) the performance of each VBA regional office; (3) the accuracy of disability ratings assigned under the Rating Schedule; (4) the consistency of disability ratings among VBA regional offices based on a sample of specific disabilities; and (5) the performance of VBA employees and managers.
VA is also required to “retain, monitor, and store,” under a demographic baseline, the following data for each disability claim submitted to VA: (1) the state in which the claimant resided when the claim was submitted, and where such claimant currently resides; (2) the decision with respect to the claim and each issue claimed; and (3) the regional office and individual VA employee responsible for rating the claim.
By October 2011, VBA is required to submit a report to Congress that contains the results and findings of the three-year independent assessment. This assessment is currently on track. VA awarded a $1.3 million contract to IDA to review: (1) the performance of each regional office; (2) accuracy of disability ratings assigned; (3) consistency of disability ratings among regional offices; and (4) implications of quantitative assessment of the performance of VBA employees and managers. VA received a progress briefing from IDA in December 2009. The briefing confirmed that the final evaluation provided by IDA will address accuracy of VBA employee work and will include a sampling methodology that will produce statistically valid results.
IDA established certain benchmarks in their progress briefing. These include outlining certain objectives, comparables, and preliminary findings. IDA’s objectives are to survey quality assurance programs used by other organizations with similar tasks, while looking for possible technology transfers appropriate for VA. The comparables currently under consideration are: (1) Social Security Disability Benefit Program; (2) Supplemental Nutrition Assistance Food Stamp Program; (3) United Kingdom Service Personnel and Veterans Administration; (4) U.S. Patent and Trademark Office; and (5) CMO (a healthcare administration firm). IDA’s preliminary findings are that there is no “gold standard” quality assurance program in other agencies and that “general” quality assurance “best practices” may be the most valuable.
According to IDA’s first progress briefing, its planned path forward will focus in part on certain research questions. Those questions will seek insight into: (1) how best to utilize VBA’s current accuracy reviews and how to handle inconsistencies in such reviews; (2) whether expanded rating reliability studies can evaluate the accuracy of certain disability ratings; and (3) what measures of consistency across regional offices reveal about accuracy.
VBA expects, according to IDA’s initial progress briefing, to receive initial findings and recommendations in the summer of FY 2010. VBA looks forward to receiving the final report required under section 224 and reporting such findings to Congress. We stand ready to objectively consider all recommendations of the final report and are ready to collaborate with stakeholders in order to improve VBA programs where possible.
Sec. 225 – Certification and Training of VBA Employees Responsible for Claims Processing
This section added 38 U.S.C. 7732A, which requires VA employee certification. Under this section, Congress required the Secretary to develop and administer a certification examination for appropriate employees and managers who are responsible for processing disability claims. In response, VA contracted with the Human Resources Research Organization (HumRRO) to assist with development and testing of a certification examination for supervisory VSRs (SVSRs) and DROs that would establish them as proficient in their work assignments. Contract costs were $313,380 for development of the SVSR examination and $268,291 for the DRO examination.
For the SVSR certification examination, HumRRO utilized information from VA subject matter experts and generated a detailed task analysis of the position. This included elements of the knowledge, skills, and abilities required for successful job performance. A test instrument database was then developed and a content validity study conducted. A pilot test followed in November 2009, which involved 114 VA regional office employees from around the country and led to completion of an online secure test instrument. HumRRO then conducted an operational field test on January 13, 2010, involving 102 regional office employees, which, when scoring is completed, will provide test takers with individualized report cards. This will serve as a model for administration of future SVSR certification examinations.
Development of the DRO certification examination instrument was delayed due to changes in the scope of the test that required contract modifications. Development continues with deployment anticipated during June 2010.
Sec. 226 – Study of Performance Measures for Claims Adjudicators
Under this section, Congress required the Secretary to initiate a study of the effectiveness of the employee work credit system and work management system to evaluate more effective means of improving disability claims processing performance. VA contracted with CNA to perform this study at a cost of $600,000. The study was conducted and produced Qualitative Analysis of VBA Employee Work Credit and Work Management Systems in November 2009, which will soon be transmitted to Congress. Again, I sincerely apologize for the delay in compliance with the requirements of the law.
CNA noted that the study results were based on qualitative data obtained from interviews of claims adjudicating personnel at six VA regional offices. CNA also looked at the current VA work management system, referred to as the Claims Process Improvement (CPI) model, which emphasizes employee task specialization.
The CNA study perspective has value, but VA is already engaged in multiple initiatives closely aligned with the CNA recommendations. Among them is a revision of current VSR performance standards to place less emphasis on tasks for individual production and more emphasis on tasks that move a claim through its life cycle to final resolution and promulgation. This revision also proposes to increase expected individual employee output quality to the overall national quality target level for a journeyman VSR. Additionally, system modifications are being pursued that will allow for the automatic capture of work credits as a claim moves through the processing stages. VA has also engaged Booz, Allen, and Hamilton to assist with evaluating the current claims process utilizing lean six sigma analysis techniques. These techniques are being applied as part of a pilot project conducted at our Little Rock VA Regional Office. I am pleased that some of your staff members have taken the time to visit the pilot site and view first-hand what is taking place.
Sec. 227 – Review and Enhancement of Use of Information Technology in VBA
Under this section, Congress required VA to conduct a review of VBA's use of information technology in disability claims processing and develop a comprehensive plan for the use of such technology in processing claims so as to reduce subjectivity, avoidable remands, and regional office variances in disability ratings for specific disabilities.
In 2009, VA performed a review of VBA’s use of Information Technology in C&P claims processing. The findings from the review were made a part of a comprehensive System Architecture Plan (SAP). The SAP included an analysis of VBA’s Paperless Delivery of Veterans Benefits Initiative (Paperless Initiative), which was VA’s first attempt at creating a paperless claims processing system. The SAP findings were consistent with VBA’s own internal findings: despite the progress made under the Paperless Initiative, VBA’s benefits claim processing continued to rely on an ineffective and costly paper-based system that was preventing VA from fully meeting its strategic goal of timely delivery of benefits to Veterans.
VA concluded it needed to focus on C&P claims processing, moving away from a broader approach incorporating all VBA services, and to develop an effective, stable, and scalable technology infrastructure to support optimized business processes.
This approach is the Veteran’s Benefits Management System (VBMS) Initiative, a cornerstone of VA’s long-term, comprehensive plan to achieve timely provision of benefits to Veterans. It is a holistic approach, integrating business transformation and a 21st century paperless claims processing system. This approach is supported by a Business Transformation Lab which serves to converge process re-engineering and technology innovation, ensuring optimized best practices are developed and tested before being deployed throughout VA.
As part of the business transformation, VA initiated a Compensation Claims Processing Pilot designed to restructure and streamline the current paper-based process through applying lean six sigma tools. This pilot will focus on reducing cycle time and improving the quality of overall end-to-end disability claims processing by driving cultural transformation and beneficial change in business processes.
As part of the technology innovation, VA will use commercial-off-the-shelf (COTS) technologies featuring a stable, scalable infrastructure that fully supports the business vision and will help ensure our best business value. The COTS technologies in large part are an extension of the state-of-the-art system being deployed as part of the long-term solution for the delivery of the New GI Bill benefits. The specific technologies include: a rules engine, a managed process flow tool, web-based data entry, report generation tools, data validation and calculation tools, and attribute-based security access tools. These will be implemented using an incremental development model based on a service- oriented architecture.
Furthermore, the VBMS Initiative is aligned with ongoing VA programs/efforts, such as Veteran’s Relationship Management (VRM), enhancements in rules-based processing, and other external initiatives. Particularly, VRM will help provide on-demand access to comprehensive VA services and benefits in a consistent, user-centric manner through a multi-channel customer relationship management (CRM) approach. VRM is designed to improve the speed, accuracy, and efficiency in which information is exchanged between Veterans and VA, regardless of the communications method (phone, web, email, or social media). Its focus will include modernizing voice telephony, unifying public contact representative desktops, implementing Identity and Access Management (IAM), developing cross-VA knowledge management systems, implementing CRM systems, and integrating self-service capabilities with multiple communication channels. A primary feature of VRM will be on-line access to services for Veterans that will promote self-service and provide access to personalized claims information.
The VBMS Initiative meaningfully addresses the objectives of section 227 of the Act by:
Reducing the average days to complete (ADC) for C&P claims—ADC shall ultimately be reduced to the strategic target of 125 days (from 161 days at the end of 2009).
Tracking progress on established milestones/deliverables on the VBMS Initiative Project Schedule.
Increasing Veterans’ access to VBA services and claims status through additional and improved web-based information processing.
Improving workflow management in areas such as claims sorting, fast-tracked binning, and dynamic load balancing with geographic flexibility.
Reducing avoidable remands caused by delayed association of paper evidence to the claim under consideration by the decision maker.
Improving reliability and security over the acquisition and movement of Veterans’ data throughout the claims process. The Virtual Lifetime Electronic Record (VLER) will streamline the process of disability determinations by making the information more accessible. The ultimate goal of VLER is to include the essential administrative data needed for benefits determinations. The first phase of VLER development between VA and DoD will be to create interoperability and exchange important electronic health information between our systems and the private sector through the protocols and standards of the Nationwide Health Information Network (NHIN). This network will exchange secure and authorized information that can ultimately produce a comprehensive record for adjudicators. This capability will enable the electronic compilation of relevant health information from multiple sources, thereby reducing the information-gathering phase and relieving the burden on Veterans, servicemembers and their families to provide this information. The VLER program is commencing with the first pilot nearing successful completion during the second quarter of FY 2010. The Department looks forward to returning with periodic updates on the phased implementation of this important program.
Sec. 228 – Study and Report on Improving Access to Medical Advice
Under this section, Congress required the Secretary to evaluate the feasibility and advisability of adding methods to improve communications between VHA and VBA as a means to provide regional office rating personnel with greater access to medical information and opinions. VA provided a report to Congress on this issue in April 2009 that was generated internally without additional cost. The report reviewed previous studies conducted on medical aspects of the disability claims process and outlined the resulting improvements initiated by VA. Such improvements include the CPEP collaboration between VBA and VHA and establishment of a VHA liaison in each regional office. The report also included an assessment of current methods and resources utilized by rating personnel to obtain competent medical information and opinions for claims adjudication purposes and concluded that existing procedures meet the needs of our rating personnel.
As explained in the report, the disability claims adjudication process currently makes effective use of VHA and contract examiners to provide medical diagnoses and an evaluation of the Veteran’s current level of disability. The other useful function of examiners is to provide opinions related to the various medical disability scenarios faced by rating personnel. These include: (1) reconciling different diagnoses; (2) clarifying the relationship between two conditions; (3) describing the extent of functional impairment; (4) providing etiology and nexus opinions; (5) determining whether a service-connected condition has aggravated a non-service-connected condition; (6) evaluating the value and credibility of submitted medical evidence; and (7) describing the extent to which service-connected disabilities affect the Veteran’s ability to perform physical and non-physical tasks in order for rating personnel to determine the impact on earnings potential.
The VHA medical services described above are generally sufficient to provide VBA rating personnel with ample information to evaluate and rate disability claims. However, if specialized medical advice is required to resolve a claim, procedures are in place to procure it from VHA or private medical specialists. VA has therefore concluded that additional medical assistance for rating personnel, such as placing medical doctors in regional offices, is unnecessary and will not improve the timeliness of claims processing.
This concludes my testimony. I would be happy to address any questions or comments from Chairman Hall or the Subcommittee Members.
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Reviewed/Updated Date: August 19, 2010