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Audit of VBA's Pension Payments

Report Information

Issue Date
Report Number
12-00181-299
VISN
State
Minnesota
Pennsylvania
Wisconsin
District
VA Office
Veterans Benefits Administration (VBA)
Report Author
Office of Audits and Evaluations
Report Type
Audit
Recommendations
8
Questioned Costs
$0
Better Use of Funds
$0
Congressionally Mandated
No

Summary

Summary
We conducted this audit to determine if the Pension Management Centers (PMCs) processed pension payments accurately. VA paid nearly $5 billion in FY 2012 for pension benefits to over 500,000 low income veterans or their beneficiaries. Delayed or incorrect payments have the potential to affect the economic status of eligible veterans and beneficiaries. Veterans Benefits Administration (VBA) can improve the timeliness, and therefore the accuracy, of pension payment processing. During a 1-year period, an estimated 93,000, or 18% of 514,000 veterans and beneficiaries, experienced an average 15-month delay in receiving their new pension award or adjustments to their current payment. Delays resulted in $308 million in underpayments and $194 million in overpayments. This included retroactive adjustments as early as 2006. Once PMC staff processed the claims, they correctly calculated pension payments for new awards and adjustments 96% of the time. The delays occurred for two primary reasons. First, PMCs did not process new awards and adjustments timely because of an increased workload and a lack of clear communication of priorities. Second, PMCs did not receive timely notification of changes that affected current pension benefits, and did not have an effective plan to reduce the time to collect income, expense, or dependency changes. In addition, VBA systems contained a small rate of duplicate pension records. VBA was aware of the potential for creating duplicate records and began taking action to control them. To reduce notification delays, the Under Secretary for Benefits should ensure Pension and Fiduciary Service implement a plan to reduce under and overpayments due to changes in income and dependency, and establish and implement matching agreements. To reduce processing delays, the Under Secretary should ensure Pension and Fiduciary Service implement new triage and processing procedures at the PMCs. The Under Secretary should implement additional controls to identify and correct duplicate records. The Under Secretary concurred with our recommendations and provided plans for corrective actions.

Open Recommendation Image, SquareOpenClosed and Implemented Recommendation Image, CheckmarkClosed-ImplementedNot Implemented Recommendation Image, X character'Closed-Not Implemented
No. 1
Closed and Implemented Recommendation Image, Checkmark
to Veterans Benefits Administration (VBA)
We recommended the Under Secretary for Benefits ensure the Pension and Fiduciary Service implements procedures that ensure continued veteran and beneficiary eligibility.
No. 2
Closed and Implemented Recommendation Image, Checkmark
to Veterans Benefits Administration (VBA)
We recommend the Under Secretary for Benefits ensure the Pension and Fiduciary Service implements a plan to reduce the amount of underpayments and overpayments due to changes in income and dependency.
No. 3
Closed and Implemented Recommendation Image, Checkmark
to Veterans Benefits Administration (VBA)
We recommend the Under Secretary for Benefits implement the use of the enhanced interagency exchange agreements with the Internal Revenue Service and Social Security Administration to reduce delays in verifying veteran and beneficiary reported income.
No. 4
Closed and Implemented Recommendation Image, Checkmark
to Veterans Benefits Administration (VBA)
We recommended the Under Secretary for Benefits establish a matching program with Medicaid to automatically identify veterans and beneficiaries that require nursing home adjustments.
No. 5
Closed and Implemented Recommendation Image, Checkmark
to Veterans Benefits Administration (VBA)
We recommend the Under Secretary for Benefits ensure the Pension Management Centers clearly outline processing priorities in their workload management plans.
No. 6
Closed and Implemented Recommendation Image, Checkmark
to Veterans Benefits Administration (VBA)
We recommend the Under Secretary for Benefits ensure the Pension and Fiduciary Service implements its plan to revise triage procedures and establish processing lanes to ensure prompt screening and routing of claims.
No. 7
Closed and Implemented Recommendation Image, Checkmark
to Veterans Benefits Administration (VBA)
We recommend the Under Secretary for Benefits ensure the Pension and Fiduciary Service corrects the duplicate records identified in this audit.
No. 8
Closed and Implemented Recommendation Image, Checkmark
to Veterans Benefits Administration (VBA)
We recommend the Under Secretary for Benefits ensure the Pension and Fiduciary Service requests an additional data test be added to their current series of data tests that would identify claimant records with similar or same names under the same file number.
Total Monetary Impact of All Recommendations
Open: $ 0.00
Closed: $ 502,000,000.00