STATEMENT OF
KEITH M. WILSON
DIRECTOR, EDUCATION SERVICE
DEPARTMENT OF VETERANS AFFAIRS
BEFORE THE
HOUSE COMMITTEE ON VETERANS' AFFAIRS
SUBCOMMITTEE ON ECONOMIC OPPORTUNITY
OCTOBER 15, 2009

October 15, 2009

            Good afternoon Chairwoman Herseth-Sandlin, Ranking Member Boozman, and Members of the Subcommittee.  I appreciate the opportunity to appear before you today to discuss the status of the Post-9/11 GI Bill implementation.  My testimony will address the challenges we face, the current status of education claims, workload trends, and countermeasures we are taking to alleviate delays in processing.  Additionally, I will highlight the important Congressional support we received during implementation.

Background and Challenges

            Enactment of the Post-9/11 Educational Assistance Act on June 30, 2008, gave VA approximately 14 months to develop a new, highly complex eligibility and payment system for hundreds of thousands of claimants who would be eligible to receive benefits under the new program on August 1, 2009.  To meet this challenge VA began accepting applications to determine eligibility for the Post-9/11 GI Bill on May 1, 2009.  On July 6, 2009, we started accepting enrollment certifications from school certifying officials for Veterans utilizing their Post-9/11GI Bill benefits for the fall term and began processing claims for payment.  The first payments were disbursed by the U.S. Treasury on August 3, 2009. 

 

Since May 1, 2009, approximately 210,000 individuals have been deemed eligible and provided a certificate of eligibility, and approximately 44,500 students have received a payment under the Post-9/11 GI Bill.  Not all individuals who applied to determine their eligibility for the new program will immediately enroll in school; they generally have 15 years following active-duty separation to use their education benefits. 

            VA testified before this Subcommittee on October 18, 2007, stating that, “these new payment methods [for the Post-9/11 GI Bill] would require extensive enhancements to existing payment systems…Our continued concern is limiting the impact on beneficiaries and ensuring timely receipt of payments.”  Between June and October 2008, VA sought contractor support for development of an information technology (IT) system to process Post-9/11 GI Bill claims beginning August 1, 2009.  As stated in VA’s press release of October 10, 2008, "VA did not receive enough proposals from qualified private-sector contractors to create an IT program that implements the new benefit.”  VA did not have confidence that any of the respondents could create the required complex IT system in sufficient time to meet the August 1 deadline.  As a result, VA terminated the solicitation process and began implementation with internal resources.  From this point, VA had nine months remaining to complete implementation.

            Due to the short timeframe, complexity of the new benefit program, and limited availability of internal IT resources, VA began development of an interim claims processing solution while simultaneously developing a long-term, rules-based processing solution in cooperation with the Space and Naval Warfare Systems Center Atlantic (SPAWAR).  VA’s Office of Information & Technology (OI&T) designed the interim processing solution functionality in three separate phases.   Each phase is intended to deliver a specific set of functionalities for claims examiners to process Post-9/11 GI Bill claims.  Development of the interim solution has presented significant challenges due to the complexity of the new program and the reduced timeline for delivery.  Prior to August 1 implementation, OI&T delivered two of the three phases of the interim solution. 

            Post-9/11 GI Bill claims currently require manual processing using four separate IT systems that do not interface to each other.  When an application or enrollment certification is received, the documents are captured into The Image Management System (TIMS).  The documents are routed electronically to a claims examiner for processing.  The claims examiner reviews the documents in TIMS and determines the student’s eligibility, entitlement, and benefit rate using the Front End Tool (FET).  The FET is used to calculate and store student information to support the Post-9/11 GI Bill claims adjudication process.  However, the FET has limited capability for processing the multiple scenarios encountered in determining eligibility and entitlement under the new program.  As a result, VA in conjunction with MITRE Corporation developed multiple job aids, or out-of-system tools and spreadsheets to augment claims processing.

            Once the benefit rate and payment amount are determined, the claims examiner manually enters the payment information into the back-end tool (BET).  The BET utilizes the existing Benefits Delivery Network (BDN) to issue payments.  A payment cannot be processed until at least two individuals approve the award and payment amount.  All evidence to support the award actions taken by the claims examiner and a senior claims examiner is captured into TIMS.  This process is completed separately for the housing allowance, the tuition and fees payment, and the books and supplies stipend.  Due to lack of integration among systems, the time to complete a Post-9/11 GI Bill claim is significantly longer than processing time for other education benefits.  Currently, it takes approximately one and a half hours to process one original claim under the Post-9/11 GI Bill.

            Phase three of the interim solution, which will provide increased functionality and additional automation for processing Post-9/11 GI Bill claims, was originally scheduled for deployment in September 2009 during the peak enrollment period for processing education claims.  Due to the complexity involved in processing for both amended awards and overlapping terms, phase three is now scheduled for early November 2009.  Amended awards include changes in a student’s actual charges for tuition and fees and reduced or increased course loads.  Since the law requires VA to pay actual charges, amended awards are required for any change in a student’s tuition and fees.  

Because the program implementation date falls in the middle of some school terms, VA must also determine rates payable to students in school on August 1, 2009, under two separate benefit programs and pro-rate Post-9/11 GI Bill benefits.  Further complicating the claims process are overlapping terms.   It is not uncommon for many students to enroll in courses that begin and end in overlapping time periods at different schools.  Processing these claims involve additional manual calculations for the overlap as well as separate payments going to more than one school. 

            In testimony before the Senate Committee on Veterans’ Affairs on May 7, 2007, VA noted that, “the increased amount of benefits payable at varying levels for different institutions would make administration of this program cumbersome.  The requirement that the benefit be paid at the beginning of the term would further complicate administration and would tax existing VA resources.” 

The new benefit program requires VA to determine maximum tuition and fee rates for each state before the beginning of each academic year.  Schools do not typically set their tuition and fee rates until state support is determined for the academic year.  Many states did not pass their operating budgets until late July/early August.  Correspondingly, institutions could not set tuition and fee rates until late August.  Delays in determining the 2009-2010 maximum tuition and fee rates resulted in delayed processing of payments for students attending school in those states.

Current Status

            Since May 1, 2009, we have received over 937,000 claims for education benefits under all education programs and have processed approximately 794,000 claims.  Enrollment certifications for approximately 30,000 students are currently pending under the Post-9/11 GI Bill.  Processing actions under our education programs increased by 180,000 over the same period last year, due in significant part to the large number of requests for certificates of eligibility for the Post-9/11 GI Bill.  The net increase in enrolled students is approximately 70,000.

            In fiscal year 2008, the average time to process all education claims was at a five-year low; we averaged 19 days for original claims and 10 days for enrollment certifications.  This fiscal year, our average processing time has risen to 26 days for original applications and 13 days for enrollment certifications.  Under the Post-9/11 GI Bill, however, original applications are taking an average of 35 days to process. 

Workload Trends

            VA anticipated a majority of students would transfer from the Montgomery GI Bill – Active Duty (MGIB-AD) and the Reserve Educational Assistance Program (REAP) to the new Post-9/11 GI Bill by the beginning of the fall 2009 enrollment period; however, this has not happened.  Instead, we have seen only a slight decrease in the number of claims received under MGIB-AD and REAP compared to the same time last year.  An original claim for education benefits takes more time to process because it requires an eligibility determination before benefits can be paid.  At this time last year, only 15 percent of the claims received during the fall enrollment period were original claims.  Between May and September of this fiscal year, 100 percent of the Post-9/11 GI Bill claims required an original entitlement determination.  We also expected the majority of Veterans applying for a certificate of eligibility for the Post-9/11 GI Bill would start school during the fall enrollment period.  Instead, many applied for the new program to receive an eligibility determination, but did not enroll in school this fall.  This is also true for the new transferability provisions under the Post-9/11 GI Bill.   The Department of Defense (DoD) has received 66,000 applications to transfer entitlement and has approved 52,000.  Of those, VA has received only 22,000 applications from spouses and dependents to use this benefit for the current academic year.

Meeting the Challenge Together

            On May 7, 2008, VA testified before the Senate Committee on Veterans’ Affairs that, “VA does not now have a payment system or the appropriate number of trained personnel to administer the program.…it would take approximately 24 months to deploy a new payment system” to support the proposed law.   Congress heard our concerns and responded through providing significant funding for VA to hire 530 term employees in December 2008 to address the anticipated increase in claims under the Post-9/11 GI Bill.  When we determined we would have limited IT capability for the interim processing solution, we hired an additional 230 term employees utilizing the additional funding provided by Congress under the American Recovery and Reinvestment Act (ARRA).

            VA is using all available resources to deliver education benefits to our Veterans.  VA rehired nine retired claims examiners and redirected 70 Regional Processing Office (RPO) employees to provide additional claims processing support.  We implemented policies to streamline the entire claims process based on case reviews identifying duplication of efforts and redundant or unneeded development.  We also implemented a mandatory overtime policy at all of our RPOs, requiring three additional days per pay period per person for claims processing.  While we are actively taking all possible steps to reduce the time to process and pay an education claim, we recognize that we are not timely serving all of our Veterans.  In response, the Secretary of Veterans Affairs authorized issuance of advance payments to Veterans enrolled in school who have not received their benefits.  On October 2, 2009, VA began issuing advance education payments to Veterans, in amounts up to $3,000, at our 57 Regional Offices and through an on-line portal at va.gov.  Advance payments are being made to Veterans in all of our education programs.  In the first week, VA made advance payments to over 41,000 Veterans totaling approximately $120 million.  Payments made under this special provision will be recouped from Veterans’ future benefits. 

Stakeholders

            Numerous initiatives were undertaken to better serve and inform our stakeholders.  VA increased efforts to more widely disseminate information, and to also improve the quality of information communicated.

            The Education Call Center (ECC) is an important resource for Veterans to receive information about their education benefits.  To meet the increased call volume, VA hired and redirected a total of 57 term personnel to the ECC, expanded phone hours, and added 72 additional phone lines.          

VA also increased correspondence with the higher education community.  We directed our Education Liaison Officers to personally contact certifying officials at schools with 300 or more Veteran students to answer any questions they had regarding certifying Veterans' enrollments or the new Post-9/11 GI Bill.  They also reminded the schools that it is not necessary to wait for the student’s certificate of eligibility before certifying the student’s enrollment.  This has never been a VA requirement in any VA education program, and the same applies to the Post-9/11 GI Bill.  VA also sent letters to schools providing a status on the state of claims processing and payments.  More than 6,000 schools were provided supplemental information on the Yellow Ribbon Program.  Over 159 schools were contacted directly to address questions or concerns about the program.  

            It has also been a priority to involve the higher education community in the implementation of the Post-9/11 GI Bill.  VA worked with the American Council on Education (ACE) to evaluate the next steps to be taken and to keep open an important line of communication with the education community.

Conclusion

            VA has hired and trained 720 new employees; built over 55,900 square feet of office space; drafted and published 359 pages of new regulations; conducted over 100 outreach and training events; entered into over 3,400 Yellow Ribbon agreements with 1,165 schools; modified 10 existing IT systems; and developed a new interim system for the Post-9/11 GI Bill.  Our Education employees continue to work tirelessly to deliver benefits to all of our Veterans attending school this fall.  We are proud of the accomplishments of our employees within the short time since the bill was enacted. 

We recognize much work remains in order for us to achieve our goal of timely delivery of education benefits to all Veterans enrolled in the Post-9/11 GI Bill and our other education programs, and we remain focused on achievement of our goal.  VA will continue to place the needs of Veterans first as we overcome the current challenges in providing education benefits. 

VA looks forward to engaging in a dialogue with Congress and our stakeholders to improve administration of the Post-9/11 GI Bill.  Thank you for your continued support throughout this effort. 

            Madam Chairwoman, this concludes my statement.  I would be pleased to answer any questions you or other Members of the Subcommittee may have.

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