Report Summary

Title: Review of VBA’s Special Initiative To Process Rating Claims Pending Over 2 Years
Report Number: 13-03699-209
Issue Date: 7/14/2014
City/State: Cleveland, OH
Columbia, SC
Houston, TX
Huntington, WV
Lincoln, NE
Los Angeles, CA
New York, NY
Waco, TX
VA Office: Veterans Benefits Administration (VBA)
Report Author: Office of Audits and Evaluations
Report Type: Audits, Reviews & Evaluations
Release Type: Unrestricted
Summary: On April 19, 2013, the Veterans Benefits Administration (VBA) began a Special Initiative to process all claims pending over 2 years. VA Regional Office (VARO) staff were to issue provisional ratings for cases awaiting required evidence and complete these older claims within 60 days. Our review focused on whether (1) provisional ratings resulted in veterans receiving benefits more quickly and helped eliminate the backlog, and (2) older claims were accurately processed under the Special Initiative. The Special Initiative rating process was less effective than VBA’s existing rating process in providing benefits to veterans quickly. Further, VBA removed all provisional claims from its pending inventory, despite more work being needed to complete them. This process misrepresented VBA’s actual workload of pending claims and its progress toward eliminating the overall claims backlog. At the end of June 2013 following completion of the Special Initiative, VBA reported 516,922 rating claims pending in its backlog, but only 1,258 rating claims pending over 2 years. We estimated 7,823 provisionally rated claims had been removed from the inventory though they still awaited final decisions. These claims represented less than 2 percent of VBA’s reported backlog, but about 12 percent of claims completed under the Initiative. VAROs did not prioritize finalization of the provisionally rated claims once they were issued. We estimated 6,860 provisional ratings were still waiting for final decisions as of January 2014, 6 months after the Initiative had ended. Because VBA did not ensure existing controls were functioning as needed to effectively identify and manage provisionally rated claims, some veterans may never have received final rating decisions if not for our review. Additionally, VBA did not accurately process 77 (32 percent) of 240 rating decisions we reviewed under this Initiative. Generally, these errors occurred because VAROs felt pressured to complete these claims within VBA’s 60 day deadline. We estimated VARO staff inaccurately processed 17,600 of 56,500 claims, resulting in $40.4 million in improper payments during the Initiative period. We recommended the Under Secretary for Benefits establish controls for all provisionally-rated claims, reflect these claims in VBA’s pending workload statistics, expedite finalization of provisional ratings, and review for accuracy all claims that received provisional ratings under the Special Initiative. The Under Secretary for Benefits concurred with our recommendations. Management’s planned actions are responsive and we will follow up as required on all actions.