Submission For The Record of James D. Ridgway, Professorial Lecturer in Law, George Washington University Law School
The fundamental challenge for the veterans benefits system today, including the appellate process, is system effects. That is the term academics use to describe the problem that occurs in large systems when the number of rules grows so large that the system stops producing the desired result, even though each individual rule can be defended as making a positive contribution to the goal. We have long passed the point of critical mass where the sum total is too complex for adjudicators at every level to keep straight, much less for untrained veterans to understand. A better appellate system — and a better adjudication system in general — needs to move away from trying to deal with millions of veterans with millions of rules, and instead focus on finding the smallest number of rules that will fulfill the goal of creating a truly veteran-friendly system that is capable of delivering timely and accurate results.
An improved appellate process needs to contribute to this paradigm shift. In a system suffering from system effects, there are no magic bullets. The problem of complexity can be solved only by dramatic change. Because the large number of rules is the central challenge, a great number of individual parts must be critically examined and streamlined. These are just a few suggestions that I have proposed in the past, and are just the beginning of a larger project that must include all the stakeholders. Most importantly, changes must be rigorously tested with real veterans to make sure that they understand and benefit from the system that is supposed to be friendly and paternalistic toward them.
• First, the complex, inefficient rules for gathering evidence must be replaced with a mechanism that allows the most difficult cases to be resolved on appeal by live hearings with medical experts that fully explore the issues necessary to bring finality to claims.
• Second, the rules governing attorney fees in the appellate process need to be rewritten to align attorney incentives with the best interests of veterans. Instead of attorneys making money by adding ever more complexity to the system, they should profit from helping veterans obtain the evidence needed to reach a final decision.
• Third, instituting procedures applying global findings of fact to repetitive issues, instead of seeking medical opinions and military records in factually similar cases that should all result in the same outcome, would lead to faster, more uniform results because the findings would be reviewed only once on appeal, rather than in each case.
• Fourth, all involved in the appellate process need to refocus (within their appropriate roles) on the first principle of making the system veteran-friendly. Notices, procedures, and other rules are helpful only if read, understood, remembered, and followed.
Everyone wants the system to provide better results, but at this point more rules increase delay, not quality. Less process and more effectiveness are the true answers.
Initially, my thanks to Chairman Runyan, Ranking Member Titus, and the Subcommittee for providing me with the opportunity to provide a statement for the record on this important issue. Although I began working for the Board of Veterans’ Appeals last year, I have written a long series of articles analyzing the dynamics of the veterans benefits system, and the appellate process in particular. The Subcommittee has asked for my views as a private citizen and professorial lecturer in law at the George Washington University School of Law. Accordingly, this statement expresses my personal views, as developed in several previously published articles (see http://ssrn.com/author=1378084), and not official positions of the Department of Veterans Affairs.
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“Any intelligent fool can make things bigger [and] more complex. . . . It takes a touch of genius — and a lot of courage to move in the opposite direction.” Attributed to Albert Einstein
Why are veterans seeking benefits waiting years on appeal? This is a very important question. The short answer is that the entire process suffers from system effects. That is the term academics use to describe the problem that occurs in large systems when the number of rules gets so large that the system stops producing the desired result even though each individual rule can be defended as making a positive contribution to the goal. In the veterans benefits system, the complexity has grown so great that the system produces veteran-unfriendly outcomes, even though each individual piece could be defended as advancing the goal of veteran-friendliness. Short of abolishing the entire system and restarting with a blank sheet of paper, there is no magic bullet for fixing the problem of too much complexity. Instead, each major component of the process needs to be reexamined and streamlined. Ultimately, solving system-effect problems is very difficult, and the only way to be sure that changes will work is rigorously test them to make sure that they produce faster, more accurate results that are understood by veterans as correct and fair.
I. Appellate Review by the Numbers
The first step to addressing the problems of the appeals process in the veterans benefits process is to define the concerns. The appellate process we have today stems from the Veterans Judicial Review Act of 1988 (VJRA). That Act created what is now the United States Court of Appeals for Veterans Claims (CAVC). The CAVC was established as an independent appellate court to review decisions made by the Board of Veterans’ Appeals (BVA), the final decision maker within VA. The VJRA also provided an additional level of appellate review by the United States Court of Appeals for the Federal Circuit (Federal Circuit) between the CAVC and the United States Supreme Court. As a result, after a veteran receives an initial decision on a claim, he or she has the right to three levels of appellate review, one within the agency and two by federal courts.
Two decades of independent judicial review substantially changed the outcomes for veterans. When I compared FY2008 to FY1988 (the year the VJRA was passed), I found that the percentage of applications granted at least one benefit at the regional office level rose from 50% to 88%. James D. Ridgway, The Veterans’ Judicial Review Act Twenty Years Later: Assessing the New Complexities of the Veterans Benefits System, 66 N.Y.U. ANN. SURV. AM. L. 251, 266-67 (2010). In addition, the average compensation (in 2008 dollars) for recipients of benefits rose from $7,060/year to $11,200/year. Id. There appears to be a strong correlation between independent appellate review and outcomes that are more favorable to veterans.
However, there is also a correlation between appellate review and processing times. From 1988 to 2008, the average appellate processing time within the agency doubled from 462 days to almost three years. Id. at 268. In FY2012, claims finally decided by the BVA had waited 1040 days on average for a decision on appeal. Of course, if a disappointed veteran took advantage of the right to appeal to the federal courts, each additional step would add one to two years to the total processing time. Moreover, because most appeals raise only procedural issues, they are most likely to result in a remand to the agency for still further proceedings.
Therefore, the question is more complicated than simply the length of time involved. It is a matter of balancing the effect of appellate review on the system as a whole, with the costs it imposes in terms of money, time, and frustration. System effects are a real problem, but appellate review also produces tangible results.
II. Why is the System So Complex?
The complexity of the system that causes system effects is not an intentional feature. The system did not become complex overnight. Therefore, reducing complexity is not a simple matter of undoing a few changes to put the system back on the “right” path. Rather, complexity is the accumulation of nearly a century of decisions, each intended to steer a better course.
The veterans benefits system we have today is essentially the one designed for World War I. The system began as a mere fourteen pages of amendments in 1917 that effectively converted the Bureau of War Risk Insurance into the benefits agency for World War I veterans. See James D. Ridgway, Recovering an Institutional Memory: The Origins of the Modern Veterans Benefits System, 1914 to 1958, 5 VETERANS L. REV. 1, 17 (2013). In 1933, Franklin Roosevelt adopted this system when he created by executive order a universal system of benefits for veterans of all conflicts. Id. at 12. That same year, he also created the BVA to review decisions of the regional offices. Id. at 39.
Since the system was created, many, many new laws, regulations, and procedures have been added to address the emerging problems of each generation. To give just one example, 38 C.F.R. § 3.7 lists over fifty classes and subclasses of military service, including “[t]hree scouts/guides, Miguel Tenorio, Penedicto Taisacan, and Cristino Dela Cruz, who assisted the United States Marines in the offensive operations against the Japanese on the Northern Mariana Islands from June 19, 1944, through September 2, 1945.” 38 C.F.R. § 3.7(x)(32) (2012). It is a monument to our commitment to justice for our veterans that such care is taken to include rules that may pertain to only three veterans. However, the proliferation of rules creates an extraordinary challenge for adjudicators to recall, find, and correctly apply all the rules that may apply to each individual.
III. Complexity Itself Has its Own Costs
In spite of the best of intentions, the large number of veteran-friendly rules works against the goal of creating a veteran-friendly system. The idea of system effects is essentially a recognition that each new rule costs more than the last one, not just in administrative overhead, but in the mental energy required by claimants, adjudicators, and representatives to process and understand. This increased mental burden leads to longer decision times and more errors.
This result was not factored into the VJRA. The concept of system effects did not really exist when the current structure of appellate review of veterans benefits was created. Ten years after the VJRA, Robert Jervis published his seminal work on the subject, SYSTEM EFFECTS: COMPLEXITY IN POLITICAL AND SOCIAL LIFE (1998). Only a decade ago, J.B. Ruhl and James Salzman published their breakthrough analysis of how system effects are a general problem for federal agencies, Mozart and the Red Queen: The Problem of Regulatory Accretion in the Administrative State, 91 GEORGETOWN L.J 757 (2003). They pointed out that, as the number of administrative rules increases in a system, compliance with those rules becomes harder and harder, and the payoff for each additional rule shrinks because the amount of time required to understand and follow the rules eventually outpaces the abilities of even very intelligent and very well-meaning individuals. The problem is not bad intent or even negligence. It is that human beings have fundamental limits in how much they can remember and synthesize, even with the assistance of modern technology.
In more concrete terms, rules are not free. Each rule takes a certain amount of effort to learn and recall. More importantly, as the number of rules increases, the number of interactions between those rules increases exponentially, x=n(n-1)/2. At a most basic level, 2 rules have 1 interaction between them, 3 rules have 3 interactions, 4 rules have 6 interactions, 5 rules have 10 interactions, 100 rules have 4,950 interactions, and 10,000 rules have nearly 50 million potential interactions to understand. In practice, not every rule has a meaningful interaction with every other rule, but adding a new rule to a system with a small number of rules is very different than adding a new rule to a system with thousands of pages of them. Even if you identify and evaluate the costs and benefits of how that rule interacts with dozens or even hundreds of other relevant rules, it becomes practically certain that some interactions were overlooked and some unintended consequences were created. Therefore, a complex system will eventually exceed the ability of people to fully understand and follow, even with the best of intentions and efforts.
Only recently have we started to pay attention to both the need to reduce complexity and how to accomplish that goal. One of the best recent efforts to explore this area has been by Harvard Law School professor Cass Sunstein. As he explained, “Even when rules are complex, frustrating, and incomprehensible to the public, they tend to seem simple and straightforward to those who wrote them . . . . Chess masters can immediately read a board, and in a fraction of a second, professional tennis players know how to handle a blistering crosscourt backhand. So too, rule writers understand the meaning of jargon-filled terms and requirements that seem impossibly baffling to those who are subject to them.” We need to “encourage the people who write rules to step back and reduce the strain on . . . people who are required to understand the rules.” CASS R. SUNSTEIN, SIMPLER: THE FUTURE OF GOVERNMENT 215-16 (2013).
This is the fundamental challenge for the veterans benefits appeals system. Those involved the appellate system must focus on making the system manageable not only for the appellate system, but for veterans, the veterans service officers who assist them, and the adjudicators who handle the claims. Unlike other systems, this appellate process reviews and shapes a system in which the claimants, adjudicators, and representatives on the front lines are not attorneys.
V. Toward a Simpler System
What is the challenge that system effects poses for the appellate system? One way to look at it is that the National Veterans Law Services Program publishes a 2,000-page collection of the statutes, regulations, and other rules of the veterans benefits system, and another 2,000-page guide to the court case law interpreting those rules. Even though each and every rule and case in this 4,000-page summary of veterans law may be defended as motivated by the best interests of veterans and a desire to make the system veteran friendly, we have long since passed the critical mass where the sum total is too complex for adjudicators and veterans representatives at every level to keep straight, much less for untrained veterans to understand. Moreover, it is too complex for those creating new rules to predict the total effect those rules will have on the system.
A better appellate system — and a better adjudication system in general — needs to move away from trying to deal with millions of veterans with millions of rules, and instead focus on finding the smallest number of rules that will fulfill the goal of creating a truly veteran-friendly system that is capable to delivering timely and accurate results. There are countless opportunities to reduce the complexity of the system. However, the steps we take must be based upon the bedrock principle that the system is intended to be veteran friendly both in outcomes and ease of use.
Here are a few options that I have explored. Certainly, this is only the beginning of a much larger project.
A. Better Evidence
As I have long maintained, the current process used to gather evidence in veterans benefits claims is inefficient and prone to error. So long as the evidence gathered in the process is of poor quality, it does not matter how the adjudication and appellate processes work. No one will have much faith in the results. Obtaining high-quality evidence would not only produce better satisfaction with the results, but would reduce the burden on the appellate system to decide what is just when the facts are less clear than they could be.
In 2008, I made two key suggestions for improving this process in an article for the Paralyzed Veterans of America’s annual writing competition, which was published the following year: James D. Ridgway, Lessons the Veterans Benefits System Must Learn on Gathering Expert Witness Evidence, 18 FED. CIR. B.J. 405 (2009). The first suggestion was for VA to create “opinion forms that — if properly completed by a physician — will answer all the questions necessary to adjudicate the claim.” Id. at 423. VA’s current Disability Benefits Questionnaire initiative is beginning to implement this advice. The challenges it faces, however, are emblematic of how the underlying complexity of the system makes streamlining any given part more difficult. As the DBQ process comes on line, appellate review must not confuse complexity with improvement, nor overburden the forms with so many requirements that neither veterans nor their private physicians can understand and complete the forms in a reasonable amount of time. Evidence that is never generated and submitted does nothing to help veterans.
My second suggestion was focused on the appellate process itself, and has yet to be explored. As I stated, even with good opinion forms, “there would still be many difficult cases in which the B[VA] or the CAVC decides upon review that the opinions in the record are inadequate. At such a point, the issues are likely to be complicated, and the veteran’s interest in a speedy resolution merits a more robust procedure than simply another written request for an opinion.” Id. at 426. In such cases, the BVA should have the option to conduct a non-adversarial video hearing with a medical expert to fully explore the claim and bring resolution to the difficult issues. Id.
These recommendations were based in part upon my experience as a trial prosecutor, which taught me firsthand that some issues are simply too difficult to understand through the slow and laborious process of written requests and opinions. Only a direct discussion allows for complete understanding. More importantly, such interactions teach lawyers and doctors how to better communicate with each other, even in those cases in which a hearing is not held.
Of course, such hearings would require the consent of the veteran and the participation of his or her representative. However, section 501 of last year’s “The Honoring America’s Veterans and Caring for Camp Lejeune Families Act” demonstrates that there is support for allowing the BVA to consider new evidence in the first instance when it is the most efficient way to resolve a claim quickly and accurately.
B. Realigning Attorney Fee Incentives
A second suggestion that I have made is to restructure the attorney fee provisions in the appeals process. See James D. Ridgway, Fresh Eyes on Persistent Issues: Veterans Law at the Federal Circuit in 2012, 62 AM. L. REV. 1037 (2013). The fundamental problem is that the current system creates strong financial incentives for attorneys representing veterans to advocate for an increasing number of procedural rules generated by the federal courts, instead of helping veterans obtain the evidence needed to bring their claims to resolution. This creates a game of “procedure whack-a-mole” where VA is constantly trying to respond to new procedural requirements, while the courts are generating ever more rules even before their previous rulings have been absorbed. The problem is compounded because attorneys frequently do not continue representation when a claim is remanded and do not help veterans get the evidence needed to resolve the claim.
The procedure whack-a-mole game occurs because attorneys have historically become involved in claims at the CAVC level after the record is closed and no further evidence may be submitted. There is almost never sufficient evidence to win a reversal from the CAVC because the multiple reviews within VA lead to the granting of claims supported by adequate evidence. Therefore, the CAVC like other federal appellate courts rarely concludes that there was clear error in the fact finding below. Attorneys are forced to argue that there was a procedural error that requires a remand to the BVA, where the record will be open again. Accordingly, in most cases addressing novel issues, the CAVC has a choice only of either affirming the status quo or adding a new rule that makes the system more complex. Adding simplicity is never an option.
The problem is compounded by the CAVC’s decision in Carpenter v. Principi, 15 Vet. App. 64, 76 (2001) (en banc), which held that “a fee which includes both an [Equal Access to Justice Act (EAJA)] award plus a contingency fee for work performed before the Court, Board, and VA on the same claim such that the fee is enhanced by an EAJA award is unreasonable.” In other words, in an attorney is paid an EAJA fee for work at the CAVC level, that payment must be offset from any future contingency fee. The court meant to be veteran friendly with this ruling and leave more money from awards in the pockets of veterans. However, as I outlined in the article listed above, in practice it makes it financially impossible in many cases for attorneys to continue representation on remand and actually help veterans in complex cases obtain the evidence needed to bring their claims to final resolution. See Ridgway, Fresh Eyes, at 1048-50.
The financial incentives of attorneys need to be realigned with those of the veterans they represent. To be clear, the problem is the rules governing the attorneys and not the attorneys themselves. As president of the Court of Appeals for Veterans Claims Bar Association and in other roles, I have come to know many of those who represent veterans for a living. Many are veterans themselves. All whom I have met sincerely wish to not only help their clients, but also to make the system the best that it can be for all veterans. However, there is a limit to the amount of pro bono work that they can do, and most of their time has to be spent performing fee-generating work that pays their bills and feeds their families.
A better fee system would allow attorneys to make reasonable livings generating evidence to resolve cases instead of generating procedure to prolong them. Rather than awarding fees under EAJA, the veterans benefits system needs a fee structure that aligns the financial interests of attorneys with the best interests of their clients: faster decisions based upon reliable evidence. Designing such a system will be a challenge. In my article, I outlined some potential features. However, one essential feature is a rule that replaces Carpenter with a rule that if an attorney continues representation before VA after a remand from the federal courts and helps obtain the evidence necessary to grant the claim, then that is necessarily different work and must be compensated as such, or attorneys will not be able to afford to provide that assistance.
C. Mass Fact Finding
Of course, complexity is also driven by the massive number of claims. Unfortunately, these rules do not resolve disability claims efficiently. Even though compensation benefits for medical disabilities are far from the only benefits provided to veterans, they are 95% percent of the claims appealed to the BVA and (based upon my ten years of experience with the CAVC) an even higher percentage of the claims appealed to the courts. The appeals system deals with medical disability claims because these are the claims that are the hardest. Our knowledge of medicine is constantly evolving and reveals ever more complexity about how our brains and bodies work. The appeals system cannot succeed by addressing medical complexity with legal complexity. Rather, it must respond with legal simplicity. In the future, the system needs to rely on simple procedures that allow for a fast, flexible response to emerging legal and medical issues. Medical and legal experts need to come together to fully explore issues.
In Heckler v. Campbell, 461 U.S. 458 (1983), the Supreme Court accepted the idea that agencies could resolve common factual issues through global findings of fact that provide a uniform answer to all claims that raise the same issue. Such findings can be published in the Federal Register and updated as appropriate. Although VA can and does resolve some cases with regulatory presumptions, less cumbersome options need to be fostered. There are many cases that cannot be resolved with presumptions, but could have the number of issues that need to be proven reduced if global findings of fact were applied, such as which military occupational specialties are associated with exposure to noise levels that contribute to hearing loss. Much effort could be saved if we applied global findings of fact to repetitive issues, instead of seeking medical opinions and military records in factually similar cases that should all result in the same outcome. Such procedures would lead to faster, more uniform results because the findings would be reviewed only once on appeal, rather than in each case that has the same issue. VA has begun to utilize this concept with lists of Navy ships with brown-water service in Vietnam and of units that served in the Korean DMZ when Agent Orange was used, but it has much more potential.
VII. Reducing Complexity
Improving the quality of evidence will reduce pressure to add more rules in the central arena of the benefits system. Eliminating skewed attorney-incentives will curb the biggest driver of additional complexity. Mass fact finding will reduce the number of times an issues must be reviewed. However, we need to do more than just halt the increase in complexity. We need to reverse it.
As I have explained in more detail in my articles cited above, both the evidence-gathering and the procedure-whack-a-mole problems were unintended consequences of the VJRA. The VJRA had the desired effect of improving outcomes for veterans, making VA more accountable, and ensuring that the agency follows its procedures. However, it also had the unintended consequence of creating a proliferation of new rules that have dramatically lengthened the time it takes to decide difficult cases. On balance, the VJRA has been a smashing success, but a quarter century later, the time has come to face the new realities of the system and ask what approaches are now best for handling the biggest challenge that the system faces today: too much complexity.
Reversing the growth in complexity has many features, but fundamentally it is about: (1) focusing on the core functions that the benefits system and appellate process need to perform, (2) designing simpler approaches to these functions, and (3) testing those new approaches to ensure that adjudicators, veterans, and their representatives actually understand the rules and believe that the outcomes produced are fair. Perhaps not every piece of the system needs to be changed, but every piece needs to be examined. We must ask questions like: “What notice will actually communicate information to veterans instead of being discarded as too long and baffling?”
The identification and examination of the pieces needs to involve all stakeholders. As a proud member of the Sons of the American Legion, I know that no reform will be possible without the enthusiastic support of the major veterans service organizations that represent the interests of the tens of millions of veterans our system serves. However, the table must include representatives from the courts and veterans attorneys as well. Most importantly, it should include independent experts on system effects and complexity who can provide a neutral voice, constantly steering the dialogue towards defining the system with as few, simple rules as possible. Therefore, the challenge for Congress is to determine how best it can foster this conversation and to facilitate the changes that will make the system simpler, faster, and more friendly to veterans in the process.
Thank you for considering my views. I look forward to assisting in the improvement of the system in any way that I can.