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STATEMENT OF RICK
SURRATT DEPUTY
NATIONAL LEGISLATIVE DIRECTOR OF
THE DISABLED
AMERICAN VETERANS BEFORE
THE COMMITTEE ON VETERANS’ AFFAIRS UNITED
STATES HOUSE OF REPRESENTATIVES FEBRUARY
13, 2002 Mr. Chairman and
Members of the Committee:
On behalf of the Disabled American Veterans (DAV), I am pleased
to appear before you to discuss the President’s fiscal year (FY)
2003 budget proposal for the Department of Veterans Affairs (VA).
The budget is, of course, a matter of paramount importance to
the more than one million disabled veterans who are members of our
organization and to the members of our Women’s Auxiliary.
The effectiveness of essentially all veterans’ programs—and
therefore the welfare of veterans and their families—is dependent
upon full funding for the benefits and services and resources adequate
to allow for their timely, efficient delivery.
Joining with AMVETS, the Paralyzed Veterans of America (PVA),
and the Veterans of Foreign Wars of the United States (VFW), the DAV
incorporates its annual recommendations for funding of veterans’
programs, and many of its legislative and policy proposals, in The
Independent Budget (IB).
With the shared goal of ensuring that the needs of America’s
veterans are adequately addressed, the four organizations pool their
resources and work together to assess and present the budgetary
requirements and related issues facing veterans’ programs. Each
of the four organizations takes primary responsibility for selected
portions of the IB. Here,
I will focus on Benefit Programs, General Operating Expenses (GOE),
and Judicial Review in Veterans’ Benefits, the DAV’s assigned
areas of the IB. The
members of the IB group appreciate the courtesy this Committee
has extended in permitting us to present our views together in this
format. The
President’s total budget of $58 billion includes nearly $1.5 billion
VA projects it will realize from medical care collections, $892
million to pay a newly assumed obligation to fund employee health care
and retirement costs, and $197 million for a new grant program for
veterans’ employment services to replace those veterans’
employment programs now administered by the Department of Labor. The $58 billion in budget authority for VA includes $29.6
billion for the benefit programs and $1.3 billion for GOE. Within the GOE appropriation, the President’s budget would
provide $1.2 billion for the delivery of benefits in the Veterans
Benefits Administration (VBA) and $278 million in budget authority for
General Administration. For
the benefit programs, the President’s budget includes funding for
its legislative recommendation to increase compensation, which
includes dependency and indemnity compensation and the clothing
allowance, to meet a projected increase in the cost of living of 1.8%
this year. The IB also
recommends a cost-of-living adjustment (COLA) for these benefits and
urges Congress not to extend provisions for rounding down the
compensation COLA beyond the current sunset date. Regrettably,
the President’s budget does not propose any other improvements to
compensation and related benefits, readjustment benefits, or insurance
programs. For these
benefit programs, the IB makes the following recommendations
for legislation:
The IB also
recommends legislation to remove the offset between military retired
pay and disability compensation and legislation to extend the 3-year
limitation on recovery of taxes withheld from disability severance pay
and military retired pay later determined exempt from taxable income.
The coauthors of the IB carefully identify areas in the
benefit programs that need adjustment or improvement to make the
benefits more effectively or equitably fulfill the purposes for which
Congress established them. Last
year, Congress enacted legislation that addressed several IB recommendations.
We appreciate your action on these matters. Although it is in a position to know where beneficial
legislative changes could better serve our Nation’s veterans, the
Administration has not taken the lead in recommending legislation to
improve veterans’ programs. Therefore,
if meritorious improvements are to be made, the members of this
Committee must initiate action on them.
In developing your legislative agenda this year, we ask that
you again give thorough consideration to the recommendations we have
included in this year’s IB. Unlike
the lack of positive recommendations in the budget to improve the
benefit programs, VA Secretary Principi has made improving VA’s
administration of the benefit programs, especially compensation and
pension claims processing, one of his foremost priorities.
We are confident of his sincerity and determination on this
issue. We have not seen
great progress in this area to date, however, and despite this
budget’s stated focus on improving claims processing, it does not
request resources to match actions with words. Although
the President’s budget recommends a $94-million increase in funding
for VBA under the GOE account, $53.9 million of that would cover a new
obligation to fund employees’ retirement and health benefits.
With the net increase of $40.2 million above last year’s
funding, the increase for VBA is approximately 3.6%, which is well
below the average increase of approximately 10% requested by the
President over the past 5 years.
The President’s budget recommends only 96 additional
employees for compensation and pension (C&P) service.
Within this budget, VA promises to reduce the average time for
rating actions on C&P claims from 208 days to 100 days in the last
quarter of FY 2003, while improving training for claims processors and
increasing the accuracy rate for core rating work from 78% in FY 2001
to 88% in FY 2003. Other
initiatives in C&P include:
While improved
processes, new technology, better training, and real accountability
for legally correct decisions—if properly, timely, and completely
implemented—will enable VA to eventually increase efficiency and
overcome its intolerable claims backlog, VA still needs additional
employees for C&P in the short term.
Training new employees, retraining VA’s existing workforce,
and conducting quality reviews of the work of individual adjudicators
will require substantial numbers of employees who will not be devoted
to production and reducing the backlog.
We believe the President’s request for only 96 additional
employees for C&P is tied more to budget targets than to the real
needs of VA. The IB recommends
funding for 350 additional employees in C&P Service.
Additionally, based on unofficial estimates, the IB
recommends $4.5 million, instead of the $2 million requested in the
President’s budget, to fund CAPER.
Unless VA makes other reforms in management and takes a more
direct and decisive approach to tackling the claims backlog, it is
likely to continue to fail in its efforts to make meaningful
improvements in the accuracy and timeliness of its claims processing.
Currently, the head of VA’s C&P service and VBA’s other
program directors do not have management authority over their
employees in VA field offices. The C&P director is powerless to enforce quality
standards and C&P policy. Higher-level
officials in VA’s Central Office are more removed from and do not
have the daily hands-on experience that the C&P director has in
the C&P programs. The
IB recommends that the C&P director and other VBA program
directors be given line authority over field offices to strengthen
VBA’s management structure and allow for more effective enforcement
of quality and performance standards.
Those who have witnessed C&P’s repeated failures to
overcome its claims processing deficiencies know that those failures
involve repetitive patterns in which VA develops plans but fails to
follow through with decisive steps to solve the difficult problems.
VA attempts to overcome its serious deficiencies by fine-tuning
its procedures and employing new technology.
While those efforts may aid in improving claims processing,
alone or in combination they are not enough to enable VA to overcome
its longstanding problem. The coauthors of the IB believe that it is obvious VA
must resolve to focus primarily on eliminating the root causes of its
claims backlog if it is to ever succeed in restoring the system to
acceptable levels of performance and service.
As noted, we believe that adequate resources are key to the
effort. However, VA’s
adjudicators make erroneous decisions because they have not been
properly trained in the law, they have operated in a culture that
tolerated indifference to the law, and they have not been held
accountable for poor performance and proficiency.
Accordingly, in conjunction with the deployment of better
training, VA must take bold steps to change its institutional culture,
and it must make its decisionmakers and managers truly accountable.
If VA’s ambitious goal of improving timeliness takes
precedence over its goal of improving quality, VA will merely repeat
the failures of the past. Speeding
up the process with the single goal of reducing claims processing
times and claims backlogs is self-defeating if, because quality is
compromised, a substantial portion of the cases must be reworked.
In this respect, VA has shown some inability to learn from its
past mistakes. VA
has made similar mistakes in its efforts to avoid meeting some of the
obligations Congress has imposed upon it and in its efforts to avoid
fully implementing legislation enacted by Congress.
In exploiting an erroneous line of decisions by the courts to
avoid its duty to assist claimants in developing and prosecuting
claims, VA made additional work for itself in the end because it had
to rework thousands of these claims after Congress intervened and
restored the duty to assist. Several
veterans’ organizations have now challenged in court VA’s rules to
implement this legislation. While
courts tend to indulge agencies in rulemaking, the veterans’
organizations challenging the validity of VA’s regulation in this
instance have a high level of confidence about the prospects for
having VA’s regulations set aside because of their clearly arbitrary
nature and conflict with the law.
If the Court of Appeals for the Federal Circuit finds that
VA’s regulations do not fulfill the mandates of the law, VA may once
again be saddled with the task or reviewing thousands of cases to
apply the law properly. These
self-inflicted setbacks complicate VA’s efforts to overcome its
claims backlog. In this
vein and because of the adverse effects upon veterans’ rights, the IB
has urged the VA Secretary to reform his department’s
rulemaking. Court
challenges to what is viewed as self-serving VA rules are becoming
commonplace. Under
the VBA portion of the GOE appropriation, the IB also includes
a recommendation to fund new information technology for VBA’s
Education Service. Administration of VA’s education programs involves the
routine exchange of massive amounts of data between educational
institutions and VA. This
routine exchange of correspondence and data is particularly well
suited to automated systems, which can greatly reduce personnel costs
and processing times. The
IB therefore recommends that Congress provide $16 million for
upgrading and expanding the limited application and capabilities of
the existing system. For
this VA initiative, known as The Education Expert System (TEES), the
President’s budget requests only $6.3 million.
Again, information not revised to meet the objectives of the
Administration’s budget process indicates that $16 million is the
real funding level needed for this project. The
President’s budget proposes legislation to establish a new program
in VBA for providing grants to states for employment and training
services for veterans. This new VA program would replace the veterans’ employment
and training services of the Department of Labor.
The IB has taken no position on this issue, but the DAV
and other veterans’ organizations have mandates from their
membership to oppose the transfer of veterans’ employment and
training services to VA from the Department of Labor.
The President’s proposal raises many questions about the
nature and effectiveness of such a program.
When the details of this proposal are made available, the IB
will give it additional consideration. The
President’s budget request would reduce the number of employees
authorized for the Board of Veterans’ Appeals (BVA) from 464 to 451.
The caseload at the Board is temporarily down because VA
regional offices have directed their resources to reducing the backlog
of claims and neglected work on their appellate workload.
However, new VA regulations recently assigned BVA the added
responsibility for correcting the regional offices’ failure to
obtain all necessary evidence. Eventually,
VA regional offices must resume work on their pending appeals, and BVA
will begin receiving large numbers of appeals that have been allowed
to accumulate in regional offices.
With this added responsibility and expected influx of cases,
reduced staffing may adversely impact BVA and protract the time for
resolution of appeals beyond its already unacceptable FY 2001 average
of 595 days. Many of
VA’s problems stem from improvident reductions in staff in the face
of impending increases in workload.
We therefore recommend caution in considering any reduction in
BVA’s workforce at this time. In
enacting legislation in 1988 to authorize veterans to challenge VA
decisions in court, Congress recognized the importance of the right to
have VA’s decisions reviewed by an independent body.
Judicial review has had the beneficial effect of exposing
administrative departure from the law and forcing reforms within VA.
However, the judicial review process needs some adjustments
itself to make it serve veterans in the manner envisioned by Congress. The
IB recommends legislation to change the standard under which
the Court of Appeals for Veterans Claims (CAVC) reviews VA’s
findings of fact in claims decisions.
The current “clearly erroneous” standard conflicts with and
undermines the benefit-of-the-doubt rule.
Under the statutory benefit-of-the-doubt rule, VA is mandated
to resolve factual questions in the veteran’s favor unless the
evidence against the veteran is stronger than the evidence for him or
her. However, CAVC will
uphold a VA decision if there is any evidence to support it, and this
renders the benefit-of-the-doubt rule unenforceable.
Currently, VA regulations, with the exception of provisions in
the Schedule for Rating Disabilities, are subject to challenge
in the Court of Appeals for the Federal Circuit (CAFC).
The IB recommends expanding CAFC jurisdiction to permit
it to review challenges to the validity of the rating schedule on the
narrow basis of whether the rating is contrary to law or is arbitrary
and capricious. The
coauthors of the IB believe that no unlawful or arbitrary and
capricious rating schedule provision should be immune to review and
correction.
The jurisdiction of CAFC is restricted in another manner that
does not serve the cause of justice well.
While CAFC has jurisdiction to consider an appeal that involves
a dispute about the proper interpretation of a law or regulation, it
has no jurisdiction to consider an appeal that involves a dispute
about the proper application of the law to the facts in a case.
The IB recommends that CAFC jurisdiction be expanded to
cover these so-called ordinary questions of law. Much of what this Committee will seek to accomplish on behalf of veterans this year will be subject to what Congress appropriates for veterans’ programs. We urge the Committee to press for a budget that is adequate for existing programs and allows for some improvement in benefits and services for veterans. We hope our independent analysis of the resources necessary for veterans’ programs and our legislative and policy recommendations are helpful to you, and we sincerely appreciate the opportunity to present our views and recommendations to the Committee. Back to Witness List |