Mr. Chairman and Members of the Committee:

I am pleased to have the opportunity to submit this testimony on behalf on behalf of the National Veterans Legal Services Program (NVLSP). NVLSP is a nonprofit veterans service organization founded in 1980. that has been assisting veterans and their advocates for twenty-seven years. We publish numerous advocacy materials, recruit and train volunteer attorneys, train service officers from such veterans service organizations as The American Legion and Military Order of the Purple Heart in veterans benefits law, and conduct quality reviews of the VA regional offices on behalf of The American Legion. NVLSP also represents veterans and their families on claims for veterans benefits before VA, the U.S. Court of Appeals for Veterans Claims (CAVC), and other federal courts. Since its founding, NVLSP has represented over 1,000 claimants before the Board of Veterans’ Appeals and the Court of Appeals for Veterans Claims (CAVC).  NVLSP is one of the four veterans service organizations that comprise the Veterans Consortium Pro Bono Program, which recruits and trains volunteer lawyers to represent veterans who have appealed a Board of Veterans’ Appeals decision to the CAVC without a representative. In addition to its activities with the Pro Bono Program, NVLSP has trained thousands of veterans service officers and lawyers in veterans benefits law, and has written educational publications that thousands of veterans advocates regularly use as practice tools to assist them in their representation of VA claimants. 

TITLE I: Modernizing The VA Claims Adjudication System

Section 101. Presumption of service-connection for veterans who were deployed in support of contingency operation with posttraumatic stress disorder

Section 101 would establish a presumption of service connection for veterans who were deployed in support of a contingency operation who now suffer from post traumatic stress disorder (PTSD).  Proposed subsection (d), which would be added to 38 U.S.C. § 1112, states:

For the purposes of Section 1110 of this title, and subject to the provisions of Section 1113 of this title, in the case of any veteran who engaged in combat with

the enemy in active service with a military, naval, or air organization of the United States during a period of war, campaign, or expedition, and who is diagnosed with post traumatic stress disorder, such disorder shall be considered to have been incurred in or aggravated by such service, notwithstanding there is no record of evidence of such disorder during the period of service.’’

In essence, Section 101 would permit veterans who have been diagnosed with PTSD to obtain service connection if they can prove that they engaged in combat with the enemy. It is NVLSP’s experience that veterans who can prove that they engaged in combat with the enemy have much less trouble establishing service connection for PTSD than veterans who cannot prove they engaged in combat with the enemy. See 38 U.S.C. § 1154(b), and 38 C.F.R. § 3.304(f). Therefore, although well intentioned, proposed Section 101 would have very limited positive impact.

In Iraq and Afghanistan there really is no specific front or rear area.  No service member is really safe in either place and just about everyone is subject to enemy attacks and exposure to events that threaten their physical safety or the physical safety of others. Therefore, NVLSP suggests that Section 101 be redrafted to establish a presumption of service connection for PTSD if the veteran served on active duty in Iraq or Afghanistan and currently suffers from PTSD, unless there is clear and convincing evidence that the veteran’s PTSD is caused by a stressful event that did not occur during a period of military service, notwithstanding the fact that there is no record of evidence of such disorder during service.   NVLSP also suggests that this same presumption extend to veterans who did not serve in Iraq and Afghanistan, but did serve in a combat zone during active duty.   Please note that under NVLSP’s proposals, to be entitled to service connection for PTSD, these veterans would still have to be diagnosed with PTSD and the mental health expert would still have to link the current condition to an in-service stressor.

It is the experience of NVLSP that the VA spends a great amount of time trying to verify alleged stressors that sometimes are impossible to confirm. If the law were changed to acknowledge that service in Iraq and Afghanistan and service in a combat zone constituted a stressor for PTSD purposes, veterans who claim service connection for PTSD would have a much easier time obtaining their rightfully earned benefits and the VA would not have to spend so much time developing claims for PTSD.

Section 103. Study on Work Credit System of Veterans Benefits Administration

Section 103 requires the VA to conduct a study of the work credit system of the Veterans Benefits Administration (VBA). VBA uses this system to measure the work production of employees of the Veterans Benefits Administration. NVLSP believes that this study is long overdue. NVLSP supports this study and suggests that the study be performed by the General Accounting Office (GAO) not the VA. Having the VA study the impact of its work measurement system is like having the fox evaluate the effectiveness of henhouse security. 

As NVLSP has previously stated, the current VA work credit system prevents the fair adjudication of many claims for VA benefits. The current VA work credit system needs to be overhauled because the current system rewards VA managers and adjudicators who claim multiple and quick work credit by not complying with the statutory duties to assist claimants obtain evidence that would substantiate their claims and notify claimants of what evidence would substantiate their claims.

No matter how much the average VA employee tries to help the claimant population, the VA decision-making culture, created by the VA work measurement system, prevents many VA adjudicators from doing a good job. The VA has created a work measurement system for deciding critically important claims that is driven by weighty incentives to decide claims quickly.  How the VA measures its work and evaluates the performance of its employees has had a major impact on the adjudication of claims for veterans benefits. 

Each year, after a complicated process involving the executive branch and Congress, the VA is given its budget.  The budget can be defined as the resources available to the Secretary of Veterans Affairs to be used to accomplish the mission of the VA.  Managers at different levels within the VA are then given their allocation from the overall VA budget.  This allocation is determined by the workload and performance of the various VA components. For example, the money budgeted to a VARO determines how many workers can be hired or fired, how equipment is maintained, and what new equipment can be purchased. 

Claims received in VARO are described as “pending issues.” These claims are assigned an “end product code,” alternatively described by the VA as a unit of work. When final action is taken on a pending claim, or pending issue, the regional office (and eventually the VA) receives a credit.

End products are assigned values based on the average number of work hours it takes an employee or group of employees to complete all action necessary for that type of claim. Each end product code has a different value.  For example, VA managers receive more credit for work completed on an original claim than they do for adjusting the income of a current pension beneficiary.  No matter how much work the VARO does on an individual claim, however, it receives as credit only the value that is provided for the end product code assigned to that particular type of pending claim.  Therefore, VA managers receive the same credit whether or not the claim is granted or denied or whether the claim takes the VARO one day or two years to decide.

VA manuals describe the end product system as a “management tool” and indicate that its measure should not be used to evaluate individual performance. As is the case with many management information systems, however, the measurement system tends to drive what and whom it measures, rather than the converse. VA managers are evaluated by how many end products they produce, how quickly they can take credit for end products, how many employees they need to produce these end products, and lastly, the quality of the work in the office they manage.  Because it is in the best interest of the VA managers to complete as many cases as quickly as they can,  the interests of VA managers in many cases stands in opposition to the interests of claimants for VA benefits.

Responsibilities of VA managers that protect the fairness of the adjudicatory process--such as “control” of claims, supervisory review of unnecessarily delayed claims, thorough development of the evidence needed to decide a claim properly, recognition of all of the issues involved, provision of adequate notice, documentation that notice was given, and careful quality review -- all adversely affect the productivity and timeliness statistics (that is, how many decisions on claims are made final within a particular period of time) for the VA manager. Consequently, proper attention by VA managers to their legal obligations very often adversely affects the statistics upon which their performance is rated. 

Fixing the VA work credit system is a topic that is near and dear to my heart. I have been involved in various aspects of veterans law for over 30 years. My experience tells me that unless the system is corrected most attempts to improve VA claims adjudication will not be successful because the driving force in VA adjudication will not be fair and accurate adjudications – but – the need to claim quick work credit.  

Section 104. Study on Work Management System

Section 104 requires the VA to conduct a study of the VA work management system.  NVLSP supports this study.

According to the VA Monday Morning Workload reports, in early January 2006 there were 532,228 total claims pending adjudication at the VA regional offices (VAROs). In early January 2007 there were 603,104 total claims pending adjudication at the VA regional offices (ROs). In early January 2008 there were 647,478 total claims pending adjudication at the VA regional offices (ROs). These VA statistics reveal that the VA admits that there are now 115,250 more claims pending adjudication at the ROs in 2008 than there were in 2006. This is an increase of over 21 percent in just two years.

If this trend continues the VA ROs will have over 947,000 backlogged claims in just four years. NVLSP believes that the current size of the backlog is obviously unacceptable and allowing that unacceptable number to grow by 200,000 cases in just four years would be insulting to veterans.

Why Is There Such A Large Backlog

In the opinion of NVLSP, the major cause of the VA claims adjudication backlog is a VA work credit system that prevents the fair adjudication of many claims for VA benefits generating extra work for the VA and major problem for claimants. Also, the inadequate quality of many VA adjudications and the inadequate number of trained adjudicators contribute to the size of the backlog.

The Impact of Judicial Review

The VA claims processing (or claims adjudication) system has been exposed by judicial review. To say there is a crisis in VA claims adjudication is an understatement. Statistics from the Board of Veterans’ Appeals (BVA) and the U.S. Court of Appeals for Veterans Claims (CAVC) show that nationally, for FY 2007, over 56 percent of all appeals decided by the BVA were reversed or remanded and over 63 percent of CAVC decisions on the merits were reversed, or remanded. In fact, some VAROs were even worse than the national average. Over 60 percent of the appeals from the New York RO and over 62 percent of the appeals from the St. Petersburg Florida RO were reversed or remanded by the BVA.

Based on the experience of NVLSP (over ten years of quality reviews, in conjunction with The American Legion, of  approximately 40 different VAROs combined with extensive NVLSP representation before the CAVC), most of the most egregious VA errors are a result of premature adjudications. For example, many errors identified by the Legion/NVLSP quality review teams reveal that VA adjudicators failed to even try to obtain evidence that could substantiate the claim, and incorrectly accepted and prematurely denied claims based on inadequate evidence (especially inadequate VA medical examinations).

Most premature VA adjudications are caused by ROs seeking work credit.  If the claimant should appeal, the RO can earn another work credit for work to process the appeal. The VA manager gets to claim three unearned work credits and to show an erroneously low time period to adjudicate these claims. That would help the manager earn a promotion and a bonus for such “productive” work. NVLSP has been repeatedly informed by a variety of current and past VARO officials that because of pressure to produce end products and reduce backlogs, they intentionally encourage the premature adjudication of claims. This statement is also based on my experience as a VA employee, and based on my experience as a member of the Legion/NVLSP quality review team.

Section 107. Expedited Treatment of Fully-Developed Claims and Requirement for Checklist to be provided to Individuals Submitting Incomplete Claims

Although NVLSP generally supports expediting VA decision-making, NVLSP opposes section 107, as written.  It creates an alluring, but treacherous trap for the hundreds of thousands of VA claimants who have not mastered veterans benefits law and the evidence that is in their VA claims files.  It is a very rare that a VA claimant will know enough about the law, the evidence that is already in his or her VA claims file, and the evidence that is not already in the VA claims file but is possessed by VA Medical Centers, other federal agencies like the Social Security Administration, and private physicians, to be able to state in a knowing and intelligent way that “no additional information is available or needs to be submitted.”

This is true even if VA provides the claimant in advance with the checklist contemplated by section 107.  The VA currently provides boilerplate notice under section 5103(a) of Title 38 of the information and evidence that a claimant needs to submit to substantiate the claim.  The VA has consistently resisted judicial decisions requiring it to tailor section 5103(a) to the individual circumstances of the claimant’s case, as Congress intended.  Moreover, the boilerplate notice is often inaccurate, missing important information, and confusing to most VA claimants given the complexity of veterans benefits law.  As worded, VA would plainly interpret the checklist provision in section 107 to allow it to use similar, confusing boilerplate language that is not tailored to the circumstances of the individual’s case and does not take into account the impact of the evidence already in the VA claims file and what particular evidence is lacking that would be necessary to submit to support an award of benefits. 

But section 107 would certainly prove attractive to most VA claimants.  The allure of a guarantee that the claim will be decided in 90 days will likely influence many unwary claimants to make an unknowledgeable statement that “no additional information is available or needs to be submitted” in exchange for a quick decision.  The future consequences of making this statement is not, but should be addressed in section 107.  What happens if the expedited claim is denied?  Does the statement that “no additional information is available or needs to be submitted” waive the claimant’s right to later complain that VA did not, but should have obtained additional information?  Does the claimant have a right later to submit additional evidence if it turns out the claimant was wrong to state that “no additional information is available or needs to be submitted.”  Is VA required to comply with current sections 5103 and 5103A of Title 38 before the expedited claim is decided.  Is VA required to comply with these current provisions after the expedited claim is denied.  All of these questions would need to be answered in a satisfactory manner before NVLSP could support section 107.

Section 108. Study and Report on Employing Medical Professionals to assist Employees of Veterans Benefits Administration

NVLSP supports hiring medical professionals to advise VBA employees. We are also pleased that the legislation specifically states that these medical professionals shall not be employed to rate claims. NVLSP suggests that language be inserted into this section that requires these medical professionals to respond only to written questions with a written response that must be placed in the claims file. Without a paper trail, it would be far too easy for the medical professionals working with lay adjudicators to dominate the claims adjudication process.

Section 109. Assignment of Temporary Disability Ratings to Qualifying Veterans

The proposed statute closely follows 38 C.F.R. § 4.28 (2008). This regulation currently provides that a veteran may be assigned a 100 percent rating if he or she suffers from an unstabilized condition that was incurred in service resulting in severe disability that makes substantially gainful employment not feasible or advisable. The 50 percent prestabilization rating is appropriate for an unstabilized condition manifested by [u]nhealed or incompletely healed wounds or injuries where material impairment of employability [is] likely.

NVLSP supports the proposed statute but suggests that language be inserted that makes it clear that veterans who suffer from mental conditions are eligible for temporary disability ratings. Also, we note with approval that the statute provides the VA the authority to extend, if appropriate, the temporary rating beyond the termination date and that the VA is required to review all pending claims to determine whether the claimant is entitled to a temporary rating.

Section 111.  Treatment of Claims Upon Death of Claimant

NVLSP strongly supports section 111, but believes certain changes should be made to the statutory language.  First, the third line of new section 5121A should be amended to add more precision; this section should cover cases awaiting decision by a VA regional office, the Board of Veterans’ Appeals, the U.S. Court of Appeals for Veterans Claims, or other reviewing court.  Second, the phrase “processing the claim” (used twice in the section) should be amended to read “processing the claim or appeal.”

TITLE II

Section 201. Creation of Single Joint Department of Veterans Affairs and Department of Defense Disability Examination Process

NVLSP strongly supports what appears to be the ultimate goal underlying Title II of the proposed bill.  A large number of military personnel are medically discharged each year as a result of a determination by a military Physical Evaluation Board (PEB) that the individual is unfit for continued military service due to certain physical or mental disabilities.  But as described briefly below, the federal government has for decades used a wasteful, redundant, and unfair system for evaluating the degree of disability of these  physical and mental disorders. 

Under current law, the PEB determines the degree of disability of those disabilities that are found by the PEB to render the individual unfit for continued military service.  The PEB uses the VA disability rating schedule to rate the degree of disability.  If the PEB disability rating determinations is 20% or below, the veteran will receive a lump-sum military disability separation payment. On the other hand, if the PEB disability rating determination is 30% or above, the veteran will receive monthly military disability retirement payments for the rest of the veteran’s life and the veteran and his or her spouse will be entitled for the rest of their lives to free military medical care.  The PEBs have long been notorious for unfairly assigning disability ratings that are lower than the degree of disability ratings the VA would assign for the same condition with the end result that  the individual is barred from military disability retirement payments and free military medical care.

The bill wisely removes the PEBs from the degree of disability determination process and relies exclusively on the VA for this determination.  This removes redundant and often inconsistent degree of disability determinations. 

But the devil is in the details.  The bill unwisely leaves all the details completely within the unbridled discretion of the Secretary of Veterans Affairs and the Secretary of Defense without even an opportunity for public participation or judicial review.  NVLSP strongly recommends that the bill be amended to mandate that:

• VA shall, using the VA disability rating schedule, rate the degree of disability of both those disabilities found by a PEB to be unfitting and those other disabilities from which the individual suffers that were not found by the PEB to be unfitting;

• Any determinations made by VA that the disability existed prior to service or the result of willful misconduct shall be governed by title 38, U.S.C. and C.F.R.;

• The initial VA degree of disability determinations shall be subject to appeal with VA under the provisions of title 38, U.S.C. and C.F.R., so that the veteran has a right to submit additional evidence, to a hearing, and to representation by an advocate.  Final VA determinations on the veteran’s degree of disability as of the date of discharge from military service shall be binding on the military department for purposes of determining entitlement to military disability separation pay, military disability retirement payments and free military medical care and shall be binding on the VA for purposes of VA service-connected disability compensation;

• If  the veteran appeals the initial VA degree of disability determination and the appeal results in a change, the VA will promptly notify the military department of the change and the military department will promptly correct the veteran’s military records to be consistent with the change;

• Before implementing the joint disability examination and determination process called for in the bill, the Secretaries of Veterans Affairs and Defense shall conduct a public rulemaking proceeding according to the provisions of section 553 of title 5, U.S.C., so that the public has advance notice of the proposal, and an opportunity to comment, and so that the Secretaries are required to consider public comment before issuance of final rules; and

• The final rules promulgated pursuant to the public notice and comment rulemaking proceeding shall be subject to judicial review in a U.S. district court under the provisions of the Administrative Procedure Act, 5 U.S.C. §§ 551, et seq.

Also, NVLSP supports Sections 102, 104, 105,106, 110, 301, and 302 of this bill.

Thank you for allowing NVLSP to present comments concerning these very important issues.