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Mr. Chairman and Members of the Subcommittee:

Thank you for inviting me to comment on the findings and recommendations of the 2004 Vocational Rehabilitation and Employment Task Force. The report, “The Vocational Rehabilitation and Employment Program for the 21st Century Veteran,” was published this week and has been presented to the Secretary.

It is critical at this time in our history—when our Nation is at war—that the VR&E Service and its partners provide our injured service members with a seamless transition from the military to a successful rehabilitation and on to suitable employment or, if necessary, independent living (IL).

This report is a blueprint for the Vocational Rehabilitation and Employment Service to rebuild its program into a new, comprehensive, employment-driven service delivery system responsive to the 21st century needs of service-connected disabled veterans. Our proposed new system is aligned with modern vocational rehabilitation practices that focus on veterans’ abilities, not their disabilities. With appropriate leadership and resources, this program can become the model of public sector rehabilitation and employment.

In the fall of 2002, Admiral Cooper, Under Secretary for Benefits, issued a detailed guidance to VA Regional Office directors that focused on making the VR&E Program more proactive in serving program participants. His growing concern led him to ask Secretary Principi to establish a Task Force to make an independent assessment of the program. Secretary Principi chartered the Task Force in May 2003 and the initial fact-finding meeting was held that same month.

The Secretary directed the Task Force to give the VR&E program “an unvarnished, top-to-bottom independent examination, evaluation, and analysis.” He challenged us to make recommendations to ensure that this program meets the intent of the law and the needs of service-connected disabled veterans with employment handicaps. I believe that this report thoroughly addresses those concerns.

Today, I would like to review for you:

• How the Task Force worked
• Some findings on the program and the veterans being served
• A blueprint for change, and
• Why VR&E must change now

How the Task Force Worked
The 12 members of the VR&E Task Force represented a diverse group of public and private sector experts from the disability community, veterans service organizations, and the fields of rehabilitation, employment services, and public administration.

The Task Force conducted its work through fact-finding sessions, site visits, informal focus groups, analysis of program data, and reviews of previous reports. The Task Force also benefited from conversations with representatives from the General Accounting Office and the Veterans Health Administration and officials of other federal agencies, as well as private sector vocational rehabilitation experts, Chapter 31 veterans, and field staff who made valuable comments.

Because of the complexity of the program and the realization that it would be necessary to recommend a complete redesign of every part of the program, the report is very comprehensive and nothing is left to chance.

Task Force Findings
While the report highlights things that we found wrong with the VR&E program, we found many things that are right. From our perspective, the VR&E officers and staff in the field have done a superb job of weathering what has been a long period of inattention by Central Office (CO). We were particularly impressed with the dedication and desire of the VR&E staff and contract professionals to serve veterans.

As this subcommittee knows, Congress started a rehabilitation program for war-injured veterans of World War I, and from that time until 1980, successful rehabilitation was defined as the completion of training for suitable employment, not actual employment. Public Law 96-466 in 1980 changed everything. Since that time, successful rehabilitation has been defined as obtaining and maintaining suitable employment or achieving independent living. Since 1980, VA’s vocational rehabilitation program has had little success in achieving the purpose of the law, despite being renamed, reorganized, and realigned several times.

Over the past two decades, the program has also been reviewed, assessed, and audited at least 24 times in separate external and internal reports, often by GAO, but also by the Congressional Commission on Service Members and Veterans Transition Assistance in 1999. Annually the VSO Independent Budget reports have also commented on the program.

Recurring themes appear throughout these reports, touching both the Central Office as well as the delivery of vocational rehabilitation and employment services in the field. The Central Office was criticized for failure to provide leadership, guidance, and program direction, often resulting in poor decision-making, outdated policies and procedure manuals, and lack of adequate program data.

The vocational rehabilitation and employment process has been repeatedly criticized for putting the emphasis on training, not employment services and employment results. The program was called too process-driven, resulting in a high attrition rate and a low success rate. In this process, veterans were declared rehabilitated without providing sufficient follow-up activities to make sure that the goal of long-term suitable employment was achieved. And, VR&E did not prioritize serving veterans with severe service-connected disabilities.

In addition, previous reports raised concerns about the failure to coordinate and be supportive within VA, with the Department of Labor, and with other federal and state agencies. The most significant and persistent criticism was that VR&E has still not fully implemented the types of changes necessary to comply with the 1980 law.

We can see the inability to achieve the employment goal in other ways:

• VBA has surveyed VR&E program participants since 1999. Participating veterans gave good marks to all the phases of the program except the job ready phase.
• Figures from the Bureau of Labor Statistics indicate that disabled veterans are on the low rung of the employment ladder.

A look at VR&E today can help explain why the employment goal has eluded the organization, despite notable efforts in recent years to refocus the program.

VR&E’s vocational rehabilitation work process has remained relatively unchanged for many years. The process:

• Is composed of sequential steps that each veteran must go through to receive services—one size fits all.
• Takes a long time for the veteran to be ready for employment, creating more opportunities for life’s problems to interrupt rehabilitation.
• Does not give priority to those veterans with serious disabilities.
• Places employment primarily at the end of the long, multi-step process rather than as an upfront consideration.
• Puts the focus on education, not employment, thus offering little in the way of informed choice for the veteran who may want to be employed right away, return to a previous employer, or pursue self-employment.

The Task Force was especially concerned with the growing workload, some of which has been consistently underreported over the years:

• The number of veterans applying for Chapter 31 benefits increased by 73 percent from FY 1992 to FY 2003.
• The number of veterans in various active phases of the Chapter 31 program at the end of FY 2003 increased by 67 percent in the same period (to 97,158 at the end of FY 2003).
• Annually more than 70 percent of the rehabilitation plans call for training or education.
• The number of veterans rehabilitated by obtaining a job or achieving independent living has averaged only about 10,000 a year since 1998. The number of veterans who gained employment gradually went down while the number of veterans maintaining Independent Living goals went up from FY 1998 to the end of FY 2003.

At present, the number of unique veterans being served in some capacity during a fiscal year is not fully reported. For example, the number of veterans who were in various active phases of the Chapter 31 programs (97,158 at the end of FY 2003) does not include veterans:
• In discontinued status,
• Receiving Chapter 36 counseling,
• Referred by VHA or other organizations for counseling,
• Evaluated 60 days after achieving their vocational rehabilitation goal,
• In receipt of counseling that does not result in Chapter 31 program participation, or
• Who received evaluations but were not found entitled.

The Task Force found VR&E and its whole organizational structure and staff under stress. Comments from VR&E staff reflect a concern that the demands and expectations being placed on VR&E are exceeding the organization’s capabilities to effectively deliver an array of comprehensive services.

Further, the administration of the program is not consistent across VA Regional Offices as evidenced by the lack of standards of practice, evidence-based guidelines, and protocols. In addition, the VBA lacks cost accounting data on resources expended to rehabilitate individual veterans.

Lack of consistency is especially evident in the Independent Living program. Currently within VR&E there is a lack of sufficient direction and staff training, specialized personnel, and integration with the VHA and the larger community-based IL movement to comprehensively serve a disabled veteran. Individual VR&E offices have implemented their own approaches to IL services and have emphasized mostly quality of life issues and personal goals (which are important), but with little attention to potential employment opportunities. The IL philosophy that has developed over the last 40 years includes empowerment, productivity, community inclusion, equal access, and employment.

For the VR&E program as a whole, employment is the primary stated objective for any veteran who enters the program. However, VR&E does not capture data on a veteran’s participation, or if a veteran gets a job prior to completing his or her vocational rehabilitation plan, or why a veteran elects to discontinue the program. VR&E data indicate that about 20 to 25 percent of the new applicants have been in the program before.

The Task Force observed that over the years, VBA’s processing of claims has significantly improved—and rightly so. However, it appears that over an extended period of time, the emphasis on one of VA’s historic missions—counseling and rehabilitation—has significantly diminished.

The Task Force concluded that the current VR&E System does not work as it was envisioned by Congress. It is our opinion that the system must and can be rebuilt, not just tinkered with.

Task Force Recommendations
For the VR&E program to be effective in the 21st Century, the Task Force recommends that VBA implement a new, five-track employment-driven service delivery system and a broad-based strategy to communicate to veterans and partners that the purpose of the program is employment.

The Five-Track Employment Process is the cornerstone of our recommendations. The new process includes five specialized program and service delivery options—all upfront in the process and based on informed choice for disabled veterans. The choices include:

• Reemployment of veterans with their previous employers
• Access to rapid employment services with new employers
• Self-employment for veterans
• Long term (traditional) vocational rehabilitation services including education
• Independent Living services with the possibility of employment when appropriate.

The Task Force recommends the use of triage techniques to provide for rapid assessment of a veteran’s immediate and long-term needs and placement into an initial track—with the agreement of the individual veteran. But the process provides options for moving to other tracks as needed to reach the employment goal. This contrasts with the current process that includes lengthy, linear steps most often beginning with education, but less often leading to suitable employment.

However, rebuilding the employment process alone is not enough.

The overall service delivery system, of which this five-track process is the key part, must be redefined and shored up—program management, fiscal and human resource allocations, quality assurance, procurement, and much more. It is just as important to increase Central Office capacities as to implement a new employment-driven process for the field. The Task Force believes that VR&E can be successful in rehabilitating the veterans who come to its door. Implementation of Task Force recommendations will better enable VA to care “for him who shall have borne the battle.”

The report includes more than 100 recommendations in four broad categories—Program, Organization, Work Process, and Integrating Capacities.

• Program recommendations address eligibility and entitlement, employment services and staffing, policy development, Independent Living services and staffing, and partnerships, including federal, state, and local.
• Organization includes recommendations on organizational, program and fiscal accountability; CO organization and facilities; and CO staffing and workforce management.
• Work Process highlights recommendations on workload management, contract services, case management and specialization, priority service at VHA, functional capacity evaluation (FCE), and Disability Transition Assistance Program (DTAP).
• Integrating Capacities recommendations address regulations and manuals, performance measures, quality review process, information and systems technology, training, resource management, and program analysis and evaluation.

The report provides commentary or appendices that explain in considerable detail what steps to take and in what sequence.

Here are some of the other Task Force recommendations by category.

Program
• Develop new policies and procedures to implement the new, five-track employment-driven service delivery system with priority given to Guard and Reservists in the tracks for reemployment and rapid access to jobs.
• Expand Chapter 36 to fully use its capabilities. This will speed up counseling services to veterans even before entitlement to Chapter 31 has been established. (About 88 percent of those found eligible are found entitled in the current process.)
• Remove the limiting periods for use of Chapter 36 counseling benefits, which we understand may require a legislative change.
• Accelerate the delivery of Chapter 31 rehabilitation services to those veterans in most critical need. This means, for example, considering making the following veterans automatically eligible or entitled: individuals medically discharged by DoD, veterans with a combined service-connected disability rating of 50 percent or more, and veterans who have loss of limb or loss of use of limb.
• Create new staff positions and add staff for an Employment Readiness Specialist and a Marketing and Placement Specialist to facilitate implementation of the five-track employment-driven service delivery system.
• Establish a VR&E Service CO staff position dedicated to lead and manage the Independent Living program.
• Create Independent Living Specialists positions with personnel experienced in social work, counseling psychology, and disability.
• Provide consistent and uniform training for IL specialists; provide consistent training.
• Initially, focus VHA/VR&E integration on Centers of Excellence for spinal cord injury, traumatic brain injury, blind rehabilitation, and stroke. Establish protocols for a VHA/VR&E team approach (One VA) under the leadership of the IL specialist.
• Initiate a study of the population of veterans currently in the VR&E IL Program and those receiving IL services; use this data and other research to develop estimates of the future demand for IL services and the types of services that might be needed to support veterans.

Organization Recommendations
• Enhance the functionality of CWINRS on a priority basis to address requirements for internal control and financial management. This means more effective management of contractor services and products by veteran, counselor and type of goods or services; establishing cumulative expenditure thresholds for purchase of goods and services and establishing a second level of pre-approval tied to these thresholds.
• Increase the current direct staffing level of the VR&E Central Office staff to more appropriately reflect the level of resources needed to execute the mission of the VR&E Service and support new and required capacities.
• Provide dedicated staff to plan and implement VA's responsibilities in DTAP and execute a consistent, national DTAP program at all Department of Defense installations and Military Treatment Facilities.

Work Process Recommendations
• Design and implement pilot functional capacity evaluation projects as a first step toward implementation as needed throughout the program.
• Set goals and measures of success to improve the administration of VA's responsibilities in TAP and DTAP.

Integrating Capacity Recommendations
• Work with General Counsel to publish updated Chapter 31 regulations consistent with the new Five-Track Employment Process and the integrated service delivery system within 9 months of the date of the VR&E Task Force Report.
• Initiate a study of other federal, state, and private sector vocational rehabilitation service organizations to benchmark process outcomes, performance measures, and quality assurance processes.
• Remove the VBA policy constraints impacting VR&E productivity and service delivery to install T-1 lines for all VR&E out-based locations.
• Hire a systems integration contractor to provide sustaining support to the VR&E Service for process and requirements analysis, technology assessments and recommendations, assistive technology consultation, and project management.
• Develop and conduct formal initial training courses and a recurring training program using community as well as private sector and university-based experts and advocates in the field of disability, rehabilitation, and employment of persons with disabilities.

It is extremely important that VR&E integrate services and strategies across agency lines. VR&E needs partners if it is to rebuild and meet the needs of current and future veterans with service-connected disabilities.

VR&E needs to renew alliances at all levels and make new strategic alliances with new partners at the local, state, and national levels. The Task Force suggests that the level of cooperation between VR&E and others that assist veterans should be dramatically improved, particularly with the Department of Labor’s Veterans’ Employment and Training programs.

The partnerships with the Departments of Labor and Defense must be strengthened and implemented if VR&E is to succeed. Working together will better benefit our service-connected disabled veterans. During the site visit to San Diego, the Task Force observed a successful partnership between VETS representatives and VR&E staff that was reinforced by a written agreement. Likewise, the State Directors of Veterans Affairs must continue to be key strategic partners with VR&E at state and local levels.

Well-developed networks are in place for many groups, both public and private sector, and they should be used to improve outreach efforts to inform veterans about VR&E services as well as to generate potential employment opportunities. For example, the Task Force recommends that VR&E leverage the capabilities of State Vocational Rehabilitation agencies. The Task Force urged a Memorandum of Agreement with the Council of State Administrators of Vocational Rehabilitation and this MOU will become a reality when Admiral Cooper and VR&E Service Director Judy Caden sign the document on April 26.

It is important that all agencies at all levels of government—federal, state, local, and tribal—work together to ensure that our veterans, especially our disabled veterans, are properly served. VR&E must apply state-of-the-art practices and make job placement and retention the measure of success. To do this, agencies must use strategic partnerships and alliances, not only with each other but with the private sector, which will be a willing partner.

Why VR&E Must Change Now
The Task Force Report offers six principal reasons why VA must transform VR&E now, not later.

• The U.S. is at war. Service to our injured service members must become a cardinal priority.

• This sense of urgency has never been more acute than now. The VR&E Service is facing a new challenge: Many Guard and Reserve personnel who have been mobilized will want to return directly to employment or to college.

• Significant numbers of veterans—in war and peacetime—will continue to experience illnesses or impairments that impact their lives forever. However, advances in medical rehabilitation, biomedical technology, rehabilitation engineering, and assistive technology will enable many who were not previously employable to get a job and to work for longer periods of time after military service than in previous generations.

• After every war, programs must adjust to the needs of the new veteran and a new environment. This means providing the type and timeliness of employment-driven services needed today and in the future because the demand for service and knowledge-based skills is greater than the demand for physical labor.

• The VR&E Program is also out of sync with 21st Century attitudes towards persons with disabilities. This Nation has witnessed a seismic shift in societal attitudes toward persons with disabilities, especially since the passage of the Americans with Disabilities Act (ADA) in 1990, the world’s first comprehensive civil rights legislation for people with disabilities. Views have shifted from disabilities to the abilities of persons, along with a rapid return-to-work strategy.

• Finally, strong indicators point to the fact that the current VR&E program, organization, and traditional vocational rehabilitation process are stressed.

It is my fervent hope that no more reports or discussions about the Vocational Rehabilitation and Employment Program are needed, just immediate and concrete actions that are supported by the Administration, the Department, and the Congress. Veterans deserve service that is timely, effective, and efficient. It is good public policy and it is the right thing to do.

For the service-connected veterans of this century, and for those who served before, VA must shore up the Vocational Rehabilitation and Employment Program. Why not build on its strengths, learn from its shortcomings, and make it the best public sector vocational rehabilitation program.

To serve those who serve us, we all must make the commitment and bear the price because what they give up is greater and what they give us is priceless.

It has been my honor to serve as the VR&E Task Force Chairman and I appreciate the opportunity to appear before this Subcommittee.

The complete VR&E Task Force Report is available online at www.va.gov/opp/vre_report.htm.

Thank you.