Good afternoon Chairwoman Herseth-Sandlin, Ranking Member Boozman, and Members of the Subcommittee.  I appreciate the opportunity to appear before you today to discuss the status of the Post-9/11 GI Bill.  My testimony will address the current status of education claims, steps taken to reduce the pending inventory and prepare for the spring enrollment period, and the status of the implementation of the Post-9/11 GI Bill Long-Term Solution. 

Current Status

On May 1, 2009, VA began accepting applications to determine eligibility for the Post-9/11 GI Bill.  On July 7, 2009, we started accepting enrollment certifications from school certifying officials for Veterans utilizing their Post-9/11 GI Bill benefits for the Fall term, and began processing claims for payment.  Since May 1, 2009, we have received over 1.5 million claims for education benefits under all education programs, and have processed approximately 1.4 million claims.  More than 389,000 Veterans have applied for certificates of eligibility under the Post-9/11 GI Bill.  VA has provided decisions with respect to approximately 346,000 of these Veterans.  VA has issued over $1.3 billion in Post-9/11 GI Bill benefit payments to approximately 180,000 individuals and their educational institutions.  

Claims-processing timeframes have risen due to the increased workload from the Post-9/11 GI Bill.  For fiscal year 2009, the average time to process all education benefit claims took 26 days for original claims and 13 days for supplemental claims.  For this fiscal year, our average processing time is 59 days for original claims and 26 days for supplemental claims.  Original applications under the Post-9/11 GI Bill are taking an average of 61 days to process, while enrollment certifications are taking an average of 38 days.

Fall Enrollment

As you are aware, many veterans enrolled in schools during the Fall of 2009 encountered unacceptable delays with respect to receipt of their benefits.  I believe it is important to convey, on behalf of Secretary Shinseki and every member of the VA team, our apologies for those delays and our understanding that the impacts of those delays on Veterans are unacceptable.  We believe we have identified and resolved the causes of many of those delays, and that the results for the Spring enrollment will be substantially improved over those of the Fall.  The three primary contributors to the Fall processing delays were:

1. Substantially longer time to process each claim than expected, caused by the rudimentary IT tools available in the interim solution;
2. Start-up problems including delays in interim solution functionality that caused us to fall behind;
3. Insufficient staffing levels to compensate for the shortfalls caused by 1 and 2.

Although we continue to receive Fall-semester enrollment certifications even today, there are currently under 1,500 enrollment certificates remaining to be completed, with the remaining certificates requiring further information from the affected students before they can be completed.

Spring Enrollment

VA has taken numerous steps to reduce the number of pending claims and prepare for the Spring enrollment period.  As a result of these improvements, VA has been able to increase its daily completions of Chapter 33 enrollment certificates from the average of 1,800 per day we experienced during October to the nearly  7,000 per day we have been able to achieve during January.  These improvements include the following:

• On October 28 ,2009, VA awarded a 90-day contract to Affiliated Computer Services in London, Kentucky to provide claims processing support for non-Post-9/11 GI Bill claims.  This effort allows VA to focus resources on the more complex Post-9/11 GI Bill claims.  As of January 8, 2010, the contractor has processed over 51,500 claims, and has been instrumental in helping VA reduce its pending workload. 
• VA continues to utilize the 230 term employees hired through the funding provided by Congress under the American Recovery and Reinvestment Act (ARRA).  In addition, we implemented a mandatory overtime policy at the four Regional Processing Offices (RPOs), requiring all employees to work three additional days per month. 
• In an additional effort to reduce the workload and allow the RPOs to divert resources to other areas, we are utilizing 200 ARRA employees at five VA satellite offices in addition to the 230 term employees to authorize Post-9/11 GI Bill payments.  The employees work seven days a week based on the workload. 
• On November 9, 2009, VA’s Office of Information and Technology (OI&T) delivered the third and final phase of the interim claims processing solution, which provides increased functionality and additional automation for processing Post-9/11 GI Bill claims.  This phase provides the functionality for processing both amended awards and overlapping terms.  Amended awards include changes in a student’s actual charges for tuition and fees and reduced or increased course loads. 
• We have implemented policies to streamline the entire claims process based on case reviews and identifying duplication of efforts and redundant or unneeded development. 
• Because Veterans were not receiving their benefits timely, VA began issuing advance housing-allowance payments to Veterans on October 2, 2009.  As of January 11, 2010, VA made advance payments to over 113,000 Veterans, totaling approximately $330.2 million.  Out of this total number of advance payments made, approximately 76,000 Veterans eligible for the Post-9/11 GI Bill received approximately $226.5 million.     

Although VA continues to receive and process Fall enrollments, we are also focusing on the significant number of Spring enrollments that we are now receiving for all education programs.  As of January 13, VA has received Post-9/11 GI Bill Spring enrollments for 111,470 Veterans, of which 80,464 have been processed.  We took aggressive action to eliminate the backlog of Fall enrollments, and we are using all available resources to ensure Veterans receive their education benefits for the Spring terms accurately and on time.  To further ensure Veterans who enroll in the Spring term receive their benefits on time, VA set a goal, one that we are confident we can achieve, to process any enrollment certification we receive before January 19, 2010, for payment by February 1, 2010.      

Long-Term Solution

VA partnered with the Space and Naval Warfare Systems Center Atlantic (SPAWAR) to develop an end-to-end claims processing solution that utilizes rules-based, industry-standard technologies for the delivery of education benefits.  This is our long-term strategy for implementing the Post-9/11 GI Bill.  The Post-9/11 GI Bill includes numerous eligibility and entitlement criteria and contemplates benefit determinations that can best be made using rules-based technology that requires minimal human intervention.

VA’s automated IT system is scheduled to be released in four phases to ensure robustness and stability.  Release 1 of this effort is to replace the current functionality of the interim solution and eliminate the need for external job aids to process Post-9/11 GI Bill claims.  Release 2 will provide automated data feeds for both claim and Veteran information.  Release 3 will provide automated data feeds into the VA financial processing systems.  Finally, Release 4 will provide a Veteran self-service interface to view the status of claims. 

While Release 1 is scheduled for deployment on March 31, 2010, this release has been changed to a limited “pilot” release, which will deliver the capability to complete original claims; automatically calculate awards including tuition and fees, housing, books and supplies, Yellow Ribbon, Montgomery GI Bill-Active Duty and Reserve Educational Assistance Program kickers; and automatically calculate awards for overlapping terms and intervals.  OI&T plans to deploy Release 1 to a limited set of claims processors to restrict the impact on the user community. 

VA expected Release 1 to also include the functionality to convert and transfer data from the interim processing solution to the long-term solution in order to enter supplemental awards for a claimant after an original award was processed in the interim solution; process Transfer of Entitlement and Fry Scholarship claims; amend awards for increases, reduction, or terminations; and pay Post-9/11 GI Bill kickers and supplemental kickers. 

The above-mentioned modification from the reduced functionality in release 1 is caused by a substantially increased appreciation of the complexity of amended awards.  As our subject matter experts (SMEs) worked with the SPAWAR team new software requirements were identified, and it became clear these new requirements could not be incorporated by the March 31, 2010, milestone requirement.  Under our Program Management Accountability System (PMAS), missing a milestone date has substantial consequences, and so a decision was made in conjunction with VBA to allow the delivery of reduced functionality in order to make the milestone date.  Most importantly, as this will be the first delivery of software for the Long-Term Solution, I believe it is critical that real users begin to use the software for production work, as this is the only way to assure ourselves that the project is delivering an acceptable product.

While complete functionality for the subsequent releases has yet to be determined, VA anticipates Release 2, to be delivered on June 30, 2010, will include the remaining features necessary to migrate the claims processors off the interim processing solution.  VA, OI&T, and SPAWAR will conduct meetings the week of January 25, 2010, to finalize the functional requirements for Releases 2, 3, and 4 of the long-term solution.  We still anticipate the successful delivery of all the functional requirements for the long-term solution by December 2010. 

Temporary Claims Examiners  

To support Post-9/11 GI Bill claims processing, VA hired 530 term employees under a 13-month authority that can be extended up to 4 years.  The term employees are part of VA’s short-term solution until OI&T delivers the long-term claims processing solution.  VA will routinely measure the impact the long-term solution has on our ability to accurately and timely process Post-9/11 GI Bill claims.  

Madam Chairwoman, this concludes my statement.  I would be pleased to answer any questions you or other Members of the Subcommittee may have. 

[Text version of PowerPoint Slide Presentation]

Post-9/11 GI Bill Long-Term Solution Implementation

January 2010
U. S. Department of Veterans Affairs, Education Service
 Washington, D.C.

Long-Term Solution Requirements

• VA enlisted SPAWAR to develop a rules-based automated Post-9/11 GI Bill claims processing system that includes and expands upon functionality provided by the Interim Solution.

• Key requirements

• Processing of original and supplemental Post-9/11 GI Bill claims, including Transfer of Entitlement (ToE) and Fry Scholarship claims

• Automated calculation of all Post-9/11 GI Bill awards, including: tuition and fee payments, housing allowance, books and supplies stipend, and Yellow Ribbon payments; benefit program kickers; overlapping and interval terms, and award amendments.

• Retrieval of demographic and service data from VADIR

• Interface to payment system for automated payments

• Veteran Self-Service capabilities

Long-Term Solution Release I Functionality

Long-Term Solution Deployment Schedule

• LTS Limited Release 1, March 31, 2010 – Pilot group of users processing original claims to evaluate the technology and reengineered business processes. Only original clean claims; no data transfer from FET; no Transfer of Entitlement (ToE) or Fry Scholarship.

• LTS Release 2, June 30, 2010 – Replace Front End Tool (FET) and Job Aid functionality, process ToE and Fry Scholarship claims, and receive data transfer from FET.

• LTS Release 3, September 30, 2010 – Adds interface to financial accounting system.

• LTS Release 4, December, 2010 – External interface to allow for Veteran self-service for applications and claims management.

VA Future Staffing

•  VA originally hired 530 term employees for 13-month terms that may be extended up to 4 years.

• VA will begin reducing term employee workforce in the first quarter of FY2011.

• VA will monitor the effectiveness and efficiency of the LTS to inform term employee reductions.

• VA will make a final determination on when employment terms should end based upon completion of LTS delivery.

VA Benefits During Spring Semester

• VA has received enrollment certifications for 90,604 Veterans, and has processed 61,595

• VA has taken many steps to decrease the claims backlog, including:

• Awarding a 90-day claims assistance contract to ACS, Inc. for recommendations on non-33 claims.

• Redirecting 200 ARRA employees at Regional Offices nationwide to claims and payment functions.

• Implementing streamlining policies and procedures.

• Providing Advance Payments to individuals awaiting normal benefit payments.

• Continuing to utilize 230 ARRA employees hired through Aug 2009 for claims processing.

VA Requirements For LTS

• The VA has tasked SPAWAR SYSCEN Atlantic with developing the Chapter 33 Long Term Solution (CH33 LTS) to replace the VA’s interim solution for processing Veteran education claims under the  Post-9/11 Veterans Educational Assistance Act of 2008. 

• By offering more “self-service functionality,” developing an accurate yet flexible rules engine, and implementing a Service-Oriented Architecture (SOA) infrastructure, the system will minimize manual intervention and maximize efficiency. 

LTS Implementation Date

• It is expected that the Chapter 33 Long Term solution will be fully implemented by December 2010.

• This solution will deliver incremental capabilities using an Agile software development methodology with four planned releases to achieve full operating capability (FOC) :

• Release 1 will improve upon existing claims-processing functionality;

• Release 2 will add automation and efficiency to claims and veteran data;

• Release 3 will add automation and efficiency to financial data; and

• Release 4 will improve upon the Veteran/claimant experience with self-service features.