VA faces flood of new claims and charges of a 'hostile' work environment

Tests of new work processes show ways the department can manage a double-digit increase in claims it expects to receive in the next two years.

The Veterans Affairs Department faces a wave of more than a million new disability claims this year, a workload compounded by delays in developing automated systems to process them, department officials and representatives of veterans services organizations told House lawmakers on Wednesday.

In addition, employees at the Veterans Benefits Administration have difficulty managing paper claims in a work environment described as "hostile" and that has "deteriorated significantly" since Eric Shinseki took over as VA secretary in January 2009, a representative of the American Federation of Government Employees told the hearing.

"In 2009, for the first time, we received over 1 million claims during the course of a single year," Michael Walcoff, acting undersecretary for benefits at VA, told a hearing of the Subcommittee on Disability Assistance and Memorial Affairs. The number of claims the department received increased from 578,773 in 2000 to 1.014 million in 2009, a 75 percent rise.

Walcoff said the number of claims should increase 13.1 percent this year to just under 1.2 million. For 2011, he said claims are projected to grow another 11.3 percent to more than 1.3 million.

Accounting for the sharp increase are the nearly 10-year-old wars in Afghanistan and Iraq and less restrictive requirements for Vietnam veterans to file claims for exposure to Agent Orange, a toxic defoliant, he said. The new Agent Orange rules will add 186,000 claims to VBA's workload through 2011. Last month, VA kicked off a fast-track procurement for an automated system to process Agent Orange claims.

Walcoff told lawmakers the agency has begun a series of pilot programs to help streamline claims processing, including a Business Transformation Lab test in its Providence, R.I., regional office that electronically processes a small number of claims. Business practices developed in Providence will be incorporated into VBA's new automated Veterans Benefits Management System, which is scheduled to go online in 2012.

Ian C. de Planque, deputy director of the American Legion's Veterans Affairs and Rehabilitation Commission, said the Providence pilot provided claims examiners with electronic tools that removed the need to "shuffle through papers and books."

In addition, examiners typically process portions of a veteran's claim serially. VBA changed that practice in another pilot at its regional office in Little Rock, Ark., where teams of employees worked together on claims. The test shows the "most promise . . . as the starting point for digital claims processing," said Carol Wild Scott, chairman of the Veterans Law Section of the Federal Bar Association.

Joseph Violante, National Legislative Director for Disabled American Veterans, said since VBA is at least a decade behind in automating its claims process, it should not "rush to meet self-imposed, aggressive deadlines for piloting and rolling out the VBMS. He urged, "They get this done right the first time."

He told lawmakers he was seriously concerned that VBA did not plan to make rules-based processing a core component of VBMS. That process is commonly used in the insurance industry to automatically compute numerous parameters in claims without the need for manual intervention. Violante said VBA officials told him rules-based processing "will be a component to be added on later, perhaps years later after the full national rollout."

He urged the subcommittee to "fully explore this issue with VBA and suggest that it might be helpful to have an independent outside expert review VBMS while it is still early in the development phase."

VBA got more bad news at the hearing when Molly Ames, a rating veterans service representative at the VA regional office in San Diego, said the agency should improve its relations between labor and management if it wants to better process the flood of claims. "Labor-management relations at many [regional offices] have deteriorated significantly, resulting in a work environment that is more hostile now than under the prior administration," she said in her testimony on behalf of the American Federation of Government Employees. "Terminations of both experienced employees and newly trained employees are a routine occurrence."

Ames said VBA has targeted union representatives, sometimes at the expense of veterans. A union official Ames did not identify was prevented from working overtime to process claims because she was a member of the union, she said.

Although Shinseki has touted the use of technology to transform VA since taking office, she said the approach does not apply to telework for employees.

VA "maintains discriminatory, counterproductive telework policies across all its [regional offices]," Ames said. "Last year, at our request, Congressman Frank Wolf [R-Va.] asked Secretary Shinseki to offer telework to more claims processors and to end the arbitrary, unfair practice of requiring higher production from work-at-home employees. Unfortunately, Secretary Shinseki refused to change course."