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Document Tampering and Mishandling at the Veterans Benefits Administration.

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MARCH 3, 2009

SERIAL No. 111-4

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BOB FILNER, California, Chairman


VIC SNYDER, Arkansas
JOHN J. HALL, New York
TIMOTHY J. WALZ, Minnesota
JOHN H. ADLER, New Jersey
GLENN C. NYE, Virginia

STEVE BUYER,  Indiana, Ranking
HENRY E. BROWN, JR., South Carolina
BRIAN P. BILBRAY, California
DAVID P. ROE, Tennessee




Malcom A. Shorter, Staff Director

JOHN J. HALL, New York, Chairman

DOUG LAMBORN, Colorado, Ranking
BRIAN P. BILBRAY, California

HARRY E. MITCHELL, Arizona, Chairman

TIMOTHY J. WALZ, Minnesota
JOHN H. ADLER, New Jersey
JOHN J. HALL, New York
DAVID P. ROE, Tennessee, Ranking
BRIAN P. BILBRAY, California

Pursuant to clause 2(e)(4) of Rule XI of the Rules of the House, public hearing records of the Committee on Veterans' Affairs are also published in electronic form. The printed hearing record remains the official version. Because electronic submissions are used to prepare both printed and electronic versions of the hearing record, the process of converting between various electronic formats may introduce unintentional errors or omissions. Such occurrences are inherent in the current publication process and should diminish as the process is further refined.



March 3, 2009

Document Tampering and Mishandling at the U.S. Department of Veterans Affairs


Chairman John J. Hall, Subcommittee on Disability Assistance and Memorial Affairs
    Prepared statement of Chairman Hall
Chairman Harry E. Mitchell, Subcommittee on Oversight and Investigations
    Prepared statement of Chairman Mitchell
Hon. Doug Lamborn, Ranking Republican Member, Subcommittee on Disability Assistance and Memorial Affairs
    Prepared statement of Congressman Lamborn
Hon. David P. Roe, Ranking Republican Member, Subcommittee on Oversight and Investigations
    Prepared statement of Congressman Roe
Hon. Deborah L. Halvorson
Hon. Ann Kirkpatrick
Hon. Timothy J. Walz


U.S. Department of Veterans Affairs:
Belinda J. Finn, Assistant Inspector General for Auditing, Office of Inspector General
    Prepared statement of Ms. Finn
Michael Walcoff, Deputy Under Secretary for Benefits, Veterans Benefits Administration
    Prepared statement of Mr. Walcoff

American Federation of Government Employees, AFL-CIO, Geneva Moore, Senior Veterans Service  Representative, Veterans Benefits Administration Regional Office, Winston-Salem, NC, U.S. Department of Veterans Affairs
    Prepared statement of Ms. Moore
Disabled American Veterans, Kerry Baker, Assistant National Legislative Director
    Prepared statement of Mr. Baker
Gold Star Wives of America, Inc., Kathryn A. Witt, Co-Chair, Government Relations Committee
    Prepared statement of Ms. Witt
National Veterans Legal Services Program, Ronald B. Abrams, Joint Executive Director
    Prepared statement of Mr. Abrams


Frasier, Susan R., Albany, NY, statement
Priessman, Master Sergeant Kurt, USAF (Ret.), Vernon, TX, statement
Simmons, Berta M., Cohocton, NY, letter


News Article:

"Veterans Affairs Probe: Records Found in Shredder Bin—Employee Under Investigation," The State, By Chuck Crumbo, November 6, 2009

Post-Hearing Questions and Responses for the Record:

Hon. Ann Kirkpatrick, Member of Congress, U.S. House of Representatives, to Michael Walcoff, Deputy Under Secretary for Benefits, Veterans Benefits Administration, U.S. Department of Veterans Affairs, letter dated March 4, 2009, and VA responses

Hon. John J. Hall, Chairman, Subcommittee on Disability Assistance and Memorial Affairs, Committee on Veterans' Affairs, to Kerry Baker, Assistant National Legislative Director, Disabled American Veterans, letter dated March 25, 2009, and DAV responses

Hon. John J. Hall, Chairman, Subcommittee on Disability Assistance and Memorial Affairs, Committee on Veterans' Affairs, to Ronald Abrams, Joint Executive Director, National Veterans Legal Services Program, letter dated March 25, 2009, and NVLSP responses

Hon. John J. Hall, Chairman, Subcommittee on Disability Assistance and Memorial Affairs, Committee on Veterans' Affairs, to Kathryn Witt, Co-Chair, Government Relations Committee, Gold Star Wives of America, Inc., letter dated March 25, 2009, and GSW responses

Hon. John J. Hall, Chairman, Subcommittee on Disability Assistance and Memorial Affairs, Committee on Veterans' Affairs, to Marilyn Park, Legislative Representative, American Federation of Government Employees, letter dated March 25, 2009, and AFGE responses

Hon. John J. Hall, Chairman, Subcommittee on Disability Assistance and Memorial Affairs, Committee on Veterans' Affairs, to Belinda Finn, Assistant Inspector General for Auditing, Office of Inspector General, U.S. Department of Veterans Affairs, letter dated March 25, 2009, and response letter dated April 23, 2009, from Hon. George Opfer, Inspector General, Office of Inspector General, U.S. Department of Veterans Affairs

Hon. John J. Hall, Chairman, Subcommittee on Disability Assistance and Memorial Affairs, Committee on Veterans' Affairs, to Michael Walcoff, Deputy Under Secretary for Benefits, Veterans Benefits Administration, U.S. Department of Veterans Affairs, letter dated March 25, 2009, and VA responses

Hon. George Opfer, Inspector General, Office of Inspector General, U.S. Department of Veterans Affairs, letter to Hon. John J. Hall, Chairman, Subcommittee on Disability Assistance and Memorial Affairs, Committee on Veterans' Affairs, letter dated March 26, 2009  [An identical letter was sent to Hon. Harry E. Mitchell, Chairman, Subcommittee on Oversight and Investigations, Hon. Doug Lamborn, Ranking Republican Member, Subcommittee on Disability Assistance and Memorial Affairs, and Hon. David P. Roe, Ranking Republican Member, Subcommittee on Oversight and Investigations, Committee on Veterans' Affairs.]


Tuesday, March 3, 2009
U. S. House of Representatives,
Subcommittee on Disability Assistance and Memorial Affairs,
Subcommittee on Oversight and Investigations,
Committee on Veterans' Affairs,
Washington, DC.

The Subcommittees met, pursuant to notice, at 1:35 p.m., in Room 334, Cannon House Office Building, Hon. John J. Hall [Chairman of the Subcommittee on Disability Assistance and Memorial Affairs] presiding.

Present from Subcommittee on Disability Assistance and Memorial Affairs: Representatives Hall, Halvorson, Kirkpatrick, Lamborn, Bilbray.

Present from Subcommittee on Oversight and Investigations: Representatives Mitchell, Space, Walz, Roe, Bilbray.


Mr. HALL.  Good afternoon.  The Committee on Veterans' Affairs Subcommittee on Disability Assistance and Memorial Affairs and the Subcommittee on Oversight and Investigations Hearing on Document Tampering and Mishandling at the Veterans Benefits Administration (VBA) will now come to order.  I would ask everyone to rise for the Pledge of Allegiance.  The flags are at both the front and rear of the room.

[Pledge of Allegiance.]

I welcome you today for our first hearing during the 111th Congress, and I am pleased to be joined by my colleague, Harry Mitchell, Chairman of the Oversight and Investigations Subcommittee.  We expect to be joined at some point by the Chairman of the full Committee, Congressman Bob Filner, who has been leading the way in making the U.S. Department of Veterans Affairs (VA) an advocacy system rather than an adversarial one.  Of course, we have our Ranking Member from the Disability Assistance and Memorial Affairs Subcommittee, Congressman Lamborn, and the Ranking Member of Oversight and Investigations, Mr. Roe.  I welcome all of you.

Congress' accomplishments for veterans last year were great and substantial.  I am eager to see implementation of P.L. 110-389, the Veterans Benefits Improvement Act of 2008, that will take steps in righting the many wrongs in the VA claims processing system.  However, there is still much more room for improvement and this promises to be a very active Congress with a new Secretary we are all eager to work with.

It is regrettable that we are starting this Congress with so many untoward problems within the VBA claims processing system making news headlines.  In the last few months, we have tracked the problems brought to our attention with misdating of claims at the New York Regional Office (RO), documents wrongly placed in shredder bins, and denying widows their survivor benefits.

It pains me as a representative from the State of New York to say that the situation in New York was a clear attempt by managers to fudge performance numbers.  The incorrectly entered data made the Regional Office look like it took fewer days to process claims than it did in actuality, yet still beyond acceptable levels to me or to most veterans.  Although veterans were not directly harmed by this practice, perpetrators of this kind of dishonesty impact the entire veterans' community's ability to trust the institution charged with its welfare.  This is shameful.

On the heels of this revelation, there were reports of documents inappropriately placed in shredder bins, many needed to process claims, that would have been returned or should have been returned to the veteran, but were dumped for shredding.  As a result, some veterans' claims were harmed and adjudication did not properly take place.  This is even more shameful.

And finally, we saw headlines about widows being cheated out of millions of dollars over a 12-year period while the VA ignored Congress' intent to help these very same widows.  VA explains this oversight as a computer glitch.  But again the result is shameful.

The misdating, shredding, and glitches that the media had recently reported, I am afraid, are only the tip of the iceberg.  I have heard too many accounts from veterans and their survivors about missing, lost, or destroyed files, and VA sending them multiple requests for information then still not knowing where a file is or who had it last. 

Even when the veteran or survivor has sent documents return receipt requested, VA manages to not know their whereabouts.  Besides the infamous fire in St. Louis and the current shredding issue, claim folders have managed to be lost or destroyed in many other ways over the years.  This has included records being misfiled or misplaced within a Regional Office, lost in transit between Regional Offices, medical, pension, insurance or debt management centers, the Board of Veterans Appeals, the Appeals Management Center, or the U.S. Court of Appeals for Veterans Claims, not to mention the issues with the U.S. Department of Defense (DoD) sharing. 

Even further beyond comprehension are the accusations by veterans and their families that VA employees would purposefully and maliciously destroy, falsify, or steal a claim folder to avoid granting a benefit.  A lot of VA employees touch a claim folder, but rarely is anyone held accountable or responsible when it is lost or destroyed.  Furthermore, we are still talking about an outdated system that is heavily dependent upon paper records.  So it is easy to conceive how a paper document can be mishandled.  An electronic system from application to adjudication could mitigate some of these losses if properly implemented, unlike the way it was handled for widows expecting a month of death benefit or at the RO in New York.  This is where new approaches to leadership and oversight are crucial and accountability is essential.

Today's witnesses will provide us with an overview of these problems.  We will hear from the veterans' service organizations and the American Federation of Government Employees (AFGE) who will provide us with insights into how veterans and their dependents are harmed when VA mishandles their documents and how improvements can be made to the system.

Next, the VA Office of Inspector General (OIG) will share what it has learned about document mishandling.  Finally, the Under Secretary for Benefits and the Systematic Technical Accuracy Review Office will give us their feedback on these problems and hopefully outline a strategic plan for the future that will correct the records mismanagement problems we have seen in the past.  So I am grateful that the Deputy Under Secretary is here himself today because the accountability issue begins with top leadership.

I have been on a track to modernize the VBA's antiquated claims processing system and envision the VA as an agency that we as a Nation are proud of in the way that it serves the welfare of our disabled veterans.   When it comes to discharging those responsibilities, shameful acts are what should be archaic practices.  We look forward to eliminating those practices.

I now yield to Congressman Mitchell, the Chairman of the Subcommittee on Oversight and Investigations, for his opening statement.

Mr. Mitchell?

[The prepared statement of Chairman Hall appears in the Appendix.]


Mr. MITCHELL.  First, thank you Chairman Hall and the Disability Assistance and Memorial Affairs Subcommittee for working with the Oversight and Investigations Subcommittee to convene this hearing.

For too long, the spotty record of the Department of Veterans Affairs has led veterans and observers to view the Department as the worst kind of bureaucracy, massive, aloof, and unaccountable.  Today, we have the opportunity to address a number of bureaucratic shortcomings and to take a step toward a more personable, accessible, and accountable VA.

Some mistakes have already been addressed.  I am encouraged that the VA is taking steps to compensate the widows of veterans whose benefits were wrongly docked when their spouses passed away.  I look forward to receiving a status update from the VA.

However, we now have learned that the shredding of documents may only be the tip of a very large iceberg.  VA's Inspector General tells us that in July of 2007, the Detroit Regional Office had a "mail amnesty" during which employees could turn in unprocessed mail and documents without repercussion. 

Detroit Regional Office employees produced almost 16,000 items, 16,000.  Among these were 700 claims and 2,700 medical records and/or pieces of medical information.  None of these claims or documents was in the VBA information system or associated claims files.  The OIG was told by the VBA regional director that there were amnesties at other Regional Offices as well. 

Obviously, we are going to have to get complete information from VA about these amnesties.  But it is impossible not to be shocked by the number from Detroit.  Shredding documents or burying them in the bottom drawer is a breach of trust by the VA.  Whether that breach of trust comes as a consequence of inadequate training or negligent or deliberate behavior, Congress must not and will not tolerate it.

We will also hear testimony about data tampering that inaccurately reflected claims processing speeds at Regional Offices.  A decision by management to lie about performance indicates creeping institutional decay that must be rooted out before it further erodes quality of care.  The VA must restore integrity to its systems—its claim system and redeem the trust of veterans it serves.

I am eager to hear a detailed account of these issues from the Inspector General's office.  And I trust that the VA will provide a candid explanation about what went wrong and how they would ensure it never happens again.

I am also eager to hear from the veterans service organizations (VSOs) about the impact of these failures on the veterans' community and from the American Federation of Government Employees about the effectiveness of VBA policy.

Mistakes like these simply need not happen.  They are avoidable as they are awful.  And they rob us of time that could otherwise be spent planning outreach to veterans, easing the transition from soldier to civilian, or constructing a 21st Century benefits program. 

But, I am heartened by the vision, dedication, and know-how that Secretary Shinseki brings with him to the task of serving America's veterans.  I am hopeful the VA can avoid similar pitfalls under his leadership.

Thank you to our panelists for appearing today.  I look forward to working with you to achieve the openness, accountability, and action that veterans deserve from the VA.

[The prepared statement of Chairman Mitchell appears in the Appendix.]

Mr. HALL.  Thank you, Chairman Mitchell, Chair of the Subcommittee on Oversight and Investigations. 

I would now yield to Ranking Member Lamborn for his opening statement.


Mr. LAMBORN.  Good afternoon, Mr. Chairmen, and thank you.  I am very happy to be back as Ranking Member of the Subcommittee on Disability Assistance and Memorial Affairs.  I greatly enjoyed the favorable rapport we developed last Congress and the bipartisan manner in which you and I and our staffs worked together.  I look forward to another productive session.

I would like to welcome our colleagues from the Subcommittee on Oversight and Investigation and all of our witnesses who are here today, including my counterpart on that Subcommittee, the Ranking Member Dr. Phil Roe of Tennessee. 

Mr. Chairman, we made a lot of progress in the last Congress toward modernizing and improving the VA claims processing system.  And it is my hope that the reforms we put in place in Public Law 110-389 will help prevent future document management problems like the ones we are examining today. 

I would also like to thank you for endorsing my idea to require VA to move toward a paperless rules-based adjudication system.  While the paperless system is not a panacea, you and I both know that if VA's files were all electronic, the shredding incident could have been avoided.  I thank VA for acknowledging that in their testimony. 

When a veteran submits a claim for disability compensation, they must be able to have trust that VA will adjudicate their claims in a timely and accurate fashion.  Unfortunately, the shredding accident has violated this trust for many veterans.  And it is now VA's job to regain it.

What troubles me the most about the shredding incident is that the number of documents VA found during its spot check was merely a one-day snapshot of what appears to be an ongoing problem.  VA will probably never know how long this mishandling has been going on or how widespread the practice was. 

However, I do applaud VA for their swift action in removing the employees that were responsible for the documents that were found.  I find it very unfortunate that the actions of a few have tarnished the work of so many dedicated VA employees.

Veterans need to be able to trust the integrity of the VA system.  And I believe they are on the path to regaining this trust.  I do believe, however, that VA's current plan to have every document signed off by two people before it can be shredded is potentially inefficient.  I encourage the VA to find a more reasonable approach to protecting claimant's files without adversely affecting production.  And I hope today's discussion will produce some possible alternative solutions. 

Another focus of this hearing is the misdating of claims at the New York Regional Office and other offices around the country.  As disturbing as this is, I am relieved to know that the actions of a few individuals have not adversely affected any veterans or survivors.  However, these actions underscore the need to review and possibly change VA's work management program.  Such review was mandated by Public Law 110-389.  And I look forward to hearing more about this review once it is completed. 

I am reassured by the findings of the Inspector General that the problem is not believed to be systemic and that the employees involved in the backdating have been removed. 

That concludes my statement, Mr. Chairmen.  I thank the witnesses for their attendance here today.  And I look forward to their testimony.  And I yield back. 

Mr. HALL.  Thank you, Mr. Lamborn.  Thank you for your steadfast advocacy of the paperless system that we are all hoping to move toward. 

Now I would like to yield to the Ranking Member of the Subcommittee on Oversight and Investigations, Congressman Roe, for his statement.  

[The prepared statement of Congressman Lamborn appears in the Appendix.]


Mr. ROE.  Thank you for yielding, Mr. Chairman. 

I would like to start by saying that I am looking forward to working with the Members of both of the Subcommittees here today, and particularly with you, Mr. Mitchell, and the other Members of the Subcommittee on Oversight and Investigations as the Ranking Member of the Subcommittee. 

I understand that you and my predecessor, Congresswoman Ginny Brown-Waite, had an excellent working relationship on this Committee.  And I hope that we can continue in that vein as we conduct oversight on issues relating to the Department of Veterans Affairs, and work to assist those who sacrificed so much for the good of our country, our Nation's veterans.  We owe them no less.

The issue at hand, document mishandling and shredding at the Department of Veterans Affairs is one of great concern.  When these issues came to the forefront of our scope back in early October of last year, an investigation by the Office of the Inspector General showed that documents necessary for processing claims were found in shredding bins at several Veteran Benefits Administration facilities.  Further issues arose from documents with an adjusted date-of-claims, which initiated a request by the Ranking Member Buyer on October 14, 2008, for an OIG investigation into the issue.

Our Nation's veterans deserve better than this.  The mishandling of their claims documents is inexcusable.  The VA is responsible for assuring our Nation's veterans that they will be given every opportunity to submit these claims and have their complete claims file reviewed in a timely manner.  I appreciate that the former Secretary Peake took immediate action to address these issues.  And I look forward to hearing from today's witnesses on what further actions have been taken to rectify this situation.

Again, thank you Mr. Chairman, and I yield back.

[The prepared statement of Congressman Roe appears in the Appendix.]

Mr. HALL.   Thank you, Dr. Roe. 

I will now recognize other Members who would like to make an opening statement.  Mrs. Halvorson?


Mrs. HALVORSON.  Thank you, Mr. Chairman.  I just want to say as one of the new people here that I'm very pleased that the VA seems to understand the seriousness of the situation.  And I am very anxious to be a part of figuring out how it is that we continue to work towards eliminating this sort of problem and bring about trust back to the situation. 

Mr. HALL.  Thank you, Congresswoman.

Mr. Bilbray?

Mr. BILBRAY.  Mr. Chairman, I have no opening statement.  I just ask for—I would like to apologize.  I am going to need to leave and enter this hearing.  I just had a report by the Marine Corps of an incident—an aircraft incident that had fatalities.  And so I would—it is just being released today, so I will be responding to that.  Just so you know that I am not trying to be rude.  It is just part of the job.  Thank you. 

Mr. HALL.  Okay.  Thank you for the explanation in advance.  You will be excused without any problem. 

Mrs. Kirkpatrick?


Mrs. KIRKPATRICK.  Thank you, Mr. Chairman.  I am honored to be here today with you and the other distinguished Members on the Subcommittee on Disability Assistance and Memorial Affairs.  Thank you to all of you for taking the time and making the journey to be with us today. 

Events like those discussed today remind me why this Committee's work is so important.  We are here to ensure our VA operation and our country live up to and fulfill our commitment to our veterans.  This is an important opportunity to discuss and evaluate the impact of VA policies on the real-life experience of veterans and their families. 

Trust needs to be the starting point when it comes to our veterans.  When they sign up, our servicemembers put the entirety of their trust in their government.  They trust that while serving they will be well equipped, that they will deploy responsibly, and they will be treated with dignity and fairness after their tour, enlistment, and service is complete. 

And in return for that trust, our servicemembers give entirely of themselves.  I have met with many veterans.  And no matter how many times I hear their stories, I am reminded that the pride, honor, and sacrifice with which they have lived their lives is truly special.  We owe our veterans for their courage, their willingness to serve, and sacrifice.

Now I don't have to tell any of the veterans here that there is no place where rumors circulate faster than inside a military barracks or inside a Veterans of Foreign Wars hall. 

So when veterans and servicemembers hear about things like shredding of claims documents, backdated forms, or unpaid widows, it creates cynicism within the ranks and among our veterans.  It hurts recruiting numbers.  But most of all and most importantly, it undermines the compact of trust we have entered into with our veterans. 

To the leadership of the Veterans Affairs, I am heartened by your quick action.  I know that the behavior discussed today is not representative of your leadership nor the vast majority of the employees within the VA. 

However, I don't think it can be repeated enough just how serious these events are.  This past Saturday I had an opportunity to visit the veterans' hospital in my district, which is in Prescott, Arizona.  And I also went to the American Legion and visited with veterans there. 

The veterans I represent expressed skepticism and often frustration regarding the distant, often faceless claims process.  To gain back their trust, I hope you understand that you will have to work twice as hard to not only hold accountable those responsible, but to find and address the underlying issues that caused this to happen in the first place.

Chairman Hall, I look forward to working with you and learning from my colleagues on both sides of the aisle.  I hope we can take the extra step, as our veterans have to make sure that they receive the benefits they have earned.

Thank you and I yield back my time.

Mr. HALL.  Thank you, Mrs. Kirkpatrick. 

Mr. Walz, do you have an opening statement?


Mr. WALZ.  Just a brief one.  And thank you, Mr. Chairman, both Chairmen and both Ranking Members, for your ever diligent work, and to the staffs on both these Subcommittees.  You have been absolutely relentless in making sure we get it right for our veterans.  So I thank you for that.  And for all of our witnesses who are here today. 

I would have to say and I would associate myself with—Mr. Lamborn brought up a very good point, I think.  The incredible work that the VA does on behalf of our veterans.  And I see it every day.  When I am out there I talk to our veterans.  Rightfully called the best healthcare anywhere.  And we know that is the case.  And we also know that it is our job and it is these VSOs' job to not only be the biggest supporters but to be the harshest critics. 

Painting it with a broad brush.  Heaven knows this group up here, we get painted with a pretty broad brush.  But the fact of the matter is we have taken jobs of leadership, both the VA and us sitting up here.  And it is a zero sum game.  We always have to strive for absolute perfection when it comes to the care of our veterans.  We may not always get there.  But it has to be in the best efforts.  So this is an important issue we are dealing with.  It is a challenging one.  Again, I would associate myself with my colleagues on the VA's effort on this and their forthrightness is greatly appreciated. 

But we have got much work to do.  And especially in this environment where reform and efficiency are going to be the key.  There are scarce resources.  They must be delivered correctly.  And we have to find a way to get better at that.  And I am still baffled that I can send a package anywhere in the world and get online and track that through UPS and know right where it is and who signed it.  And yet I have got veterans 2 years later wondering where in the heck their file is, who saw it, and what is going on with it.

So we have got to just get this done.  We have got to move forward.  And if you don't need any more proof than that, I will tell you I have seen this group speak often.  And Ms. Witt is going to speak in a moment.  When our Nation's Gold Star Wives have to come in front of us and tell us what is going wrong and the difficulties they have receiving benefits after their spouses gave their life in defense of this country, the bottom line is we are wrong.  And it needs to be fixed.  And we need to get there together.  Bringing the two Subcommittees together is absolutely what we need to do, cut through this, find some solutions, cut down on the backlogs of claims, get them right, and get the trust built back up.  That is our responsibility.  And that is our charge.

So, Mr. Chairman, thank you for holding this hearing.  And I yield back.

Mr. HALL.  Thank you, Mr. Walz.  I think you may have come up with the solution.  It is sort of like that commercial I have been seeing on TV where you put a delivery company in charge of getting kids to schools.

Mr. Space, I yield to you for an opening statement.

Mr. SPACE.  In associating myself with remarks of Mr. Walz, I yield my time. 

Mr. HALL.  Thank you, Mr. Space.  Thank you to all of our witnesses for being here today.  I would remind you that your complete written statements will be made a part of the hearing record, so you can limit your remarks.  That way we will have sufficient time to follow up with questions once everyone has had the opportunity to provide their testimony.

On our first panel, is Mr. Kerry Baker, Assistant National Legislative Director for Disabled American Veterans (DAV); Mr. Ronald Abrams, Joint Executive Director for the National Veterans Legal Services Program (NVLSP); Ms. Kathryn Witt, Co-Chair, Government Relations Committee for Gold Star Wives of America, Inc.; and Ms. Geneva Moore, Senior Veterans Representative—Service Representative for the Veterans Benefits Administration Regional Office in Winston-Salem, North Carolina.

Welcome, Mr. Baker, you are now recognized for 5 minutes.



Mr. BAKER.  Mr. Chairman and Members of the Subcommittees, it is a pleasure to be here today on behalf of the DAV.  I look forward to discussing the recent document tampering and mishandling by the VA. 

The issues of concern began on or about August 20th, 2008, when VA's Office of Inspector General initiated an audit of mail processing at four different locations.  The team found 36 pieces of active mail and 93 other pieces of documents in the shred bins.

The documents identified were both original claims and evidence in support of existing claims.  The VA's Secretary ordered all shredding stopped followed by a search of all VA Regional Offices where approximately 500 other documents were found marked for unauthorized shredding. 

The VA then drafted an action plan that implemented numerous overlapping procedures to eliminate any repeat records mishandling.  The draft plan even included the creation of additional positions within VA that require active, hand's on management of all documents marked for destruction. 

In addition to the action plan, special but temporary procedures were also put in place concerning VA claimants who assert they have been harmed by these mishaps. 

The DAV will not attempt to minimize the severity of this situation.  The questions of how long this has been going on and how many VA claimants have been affected will forever go unanswered.

However, scrutinizing and casting blame is easy.  If we all are to act as leaders in the veteran community, then we must recognize the challenge before us.  Not merely how to prevent such acts in the future, but how to recognize the faults in the current system that allow these actions to take place.  Once acknowledged and understood, we must progressively change the structure to remove those faults.  In our written testimony, we commended the VA for having detected these unlawful deeds through its own audit functions in implementing such a detailed plan meant to prevent similar actions in the future.  We reiterate that commendation here today. 

Nonetheless, we also recommended that Congress amend the law to punish VA employees who unlawfully withhold benefits from claimants, the same as it punishes those who unlawfully obtain benefits.  The message must be that if you illegally destroy records, you will go to jail.  Ultimately, the DAV believes these were desperate, albeit irresponsible and unlawful acts, of a workforce near its breaking point. 

The solution is clear.  The VA must go paperless.  This has long been a goal of Congress and the VA.  The VA must be up for the challenge.  And Congress must provide any needed funding.

The VA has already begun to utilize paperless solutions in many of its functions.  While they are promising, each of these programs are small compared to the remaining bulk of VA's paper-locked workload. 

The DAV believes the one solution that Congress must consider above all else is to immediately authorize and fund the formation of one or more large-scale imaging centers.  Such facilities should have the sole function of transforming paper records into electronic format.

The formation of imaging centers could then free VA's moderate-sized staff who are tasked with receiving incoming and managing existing paper records.  VA managers could then utilize the sizable workforce required for these functions to assisting claims development and adjudication.

The idea of transforming the paper-locked records system to an electronic system is neither novel nor new.  Rather it has been the centerpiece of all legitimate discussions on improving the claims process.  Ultimately denying earned benefits by illegally destroying records should serve as the wake-up call that signals the urgency of this overdue transformation.  It should be one of the highest priorities within the Benefits Administration.

Mr. Chairman, that concludes my oral statement.  It has been an honor to testify before you today.  And I look forward to any questions you may have.

[The prepared statement of Mr. Baker appears in the Appendix.]

Mr. HALL.  Thank you, Mr. Baker. 

Mr. Abrams, you are now recognized for 5 minutes.


Mr. ABRAMS.  Thank you Mr. Chairmen and Members.

I am honored to be here again today to talk about this very serious problem.  Rather than go over what happened, I am going to try and focus on why it happened and what we can do about the problem. 

I would like to start by reminding some of us who are my age that there was a television show back in the 1950s, Lucy.  And there was an episode in Lucy where she and her friend Ethel got a job at a candy factory producing candy.  And they were working on a production line.  And they were told that if they let one piece of candy pass them without getting wrapped, they would be fired.  So what happened?  First the candies came out slowly.  And then the supervisor came by and yelled, "Let her roll."  And the candies came out faster and faster.  And no one could wrap them.  So what did Ethel and Lucy do?  They put them in their blouse; they put them in their pockets; they put them in their hat; and put the hat back on.  They had one of those candy hats.  And they ate them.  They cheated. 

This is analogous to what is happening in the VA.  Too many claims, too fast, a production quota or—it is not a real quota.  But it is a system that pushes production.  It is not right. 

We at NVLSP believe that longstanding VA policies were the major cause of this employee misconduct.  Essentially the way the VA grants work credit and assesses the performance of VA workers and managers is the main problem.

In our experience, most of the problems are an attempt by VA workers to prematurely issue a decision on a claim before the evidence the VA is required to get to help the veteran is associated with the file.  And this rush causes many incomplete VA claims adjudications.  The VA emphasizes quantity over quality. 

This work system, this work measurement system, needs to be changed.  It needs to be changed, because it creates a cynicism among VA workers.  They think it is okay to go too fast, to not get all evidence.  And that might lead to hiding evidence, putting it in a drawer, throwing it away.  We need to change that.  We need to promote managers who manage people who do good work as well as fast work.

So here are some of the things that we think should be done.  First, we need to hold VA adjudicators and managers accountable for the quality of their work.  We need rational performance standards.  The VA employees I know are good.  They want to do a good job.  But they are pressured to go very, very fast.

Second, they need to change the way they measure work.   Work credit should not be granted until the actual appellate period ends.  In that way all work will be done up front. 

And third, the VA needs to create an independent quality review system that is outside the supervision of VBA.

Thank you for letting us testify today.

[The prepared statement of Mr. Abrams appears in the Appendix.]

Mr. HALL.  Thank you, Mr. Abrams.  Good timing. 

Now I would like to recognize Ms. Kathryn Witt for 5 minutes.


Ms. WITT.  Thank you for allowing Gold Star Wives the privilege of testifying today.

I tend to agree with both of the people who spoke before me that the employees are under too much pressure.  They do this to get rid of this back load.  The inability to get rid of the back load tends to create a greater back load, because when they can't find the claim, then the veteran or the survivor resubmits it again and again.  I have one lady that has been asked to prove that she was married to her husband and they had three children three separate times.  I have another lady that has filed four appeals, two of which have been lost twice.

What they need to do is automate the system.  Most records as they come in the door need to be scanned into a computer and assigned a line number or a customer number and cross indexed against the veteran's Social Security—the veteran's name and Social Security number so that they—the previous documents and claims can be retrieved.

They also need an explanation when they send a claim out of what they have actually paid, and why they paid it, and how.  Usually known as a detailed—an itemized voucher.  Our survivors frequently get claims they have no idea what they are for.  And if they have several claims, they have no idea what has been processed.  And they submit another claim.

We have concern about the backlog on—particularly on Dependency and Indemnity Compensation (DIC).  It is taking a long time to process DIC.  It often leaves the widows destitute.  They have no other funds.  If their husbands have been service connected and they have been at home caring for them, his check stops.  And his compensation check stops.  And they have no other income.  We are concerned about the delay in that.

And we are concerned about the delays in processing CHAMPVA, which is the VA's health insurance.  It frequently takes—I am hearing 9 to 12 months to get an application for CHAMPVA processed and approved.  Both of those are pretty cut and dried claims that could easily be processed by computer. 

I believe that every claim that the VA receives should be scanned—completely scanned into the computer.  I think that is the only way you are ever going to get rid of this backlog.  And then you can track them and cross index them by name and Social Security number.  And at least respond to people when they call about their claim to say yes we have it, so that you don't get four or five more claims in. 

Thank you.

[The prepared statement of Ms. Witt appears in the Appendix.]

Mr. HALL.  Thank you, Ms. Witt. 

I would like to at this time recognize Geneva Moore, Senior Veterans Service Representative for the VBA Regional Office in Winston-Salem.  You are recognized for 5 minutes.


Ms. MOORE.  Thank you.  Chairman Hall, Chairman Mitchell, Members of the Subcommittee, it is my honor and pleasure to be here today to testify on behalf of the many thousands of VBA employees represented by the AFGE.

I am a retired Marine Corps Master Sergeant and a proud Gulf War veteran.  I am equally proud of the important work that I do as a Senior Veteran Service Representative (VSR) to ensure that my fellow veterans are properly compensated for their service-connected disabilities. 

More than half of the employees at our Regional Office are veterans and most are service-connected disabled.  As veterans helping veterans, we who also borne the battle, do our jobs with tremendous sympathy and compassion for our fellow veterans.

AFGE absolutely does not condone what has gone on with regard to misplaced or shredded claims files.  We are 150 percent committed to do all that we can do.  And we want to help VBA fix this problem.  But management is not willing to come to the table with us to come up with a workable solution to the shredding problem.

If I were in management, it would make perfect sense to me to solicit the input from the employees who actually process the claims.  In the Marine Corps, we work as a team.  And we are able to resolve problems through effective, positive communication.  But VBA has shut us out completely, the employees. 

I was at the VBA Academy when I first heard the shredding reports.  Management presented us with the national rules of behavior and demanded that we sign on the spot without any training or opportunity to ask questions or seek further guidance.  We were told that we would face discipline or possible termination if we did not sign this national rules of behavior.

When I returned back to my RO, we were given only 1-day notice of a desk audit.  They told us that we had to clear our desks of every extraneous documents.  In my case, I lost over 14 years of training materials and binders that I used for unique cases that helped me do my job effectively.

Management refused to give us 1 minute of deductible time away from case production to sort through our documents.  We were extremely anxious about what would happen if management determined that we were not in compliance.  So we did the only thing we could do, clear our desks of all training documents and materials.

High production quotas are no excuse for possible improper document shredding.  However, more realistic quotas and better training will reduce the problems and enhance the overall effectiveness of the ROs.  

When I served on the group investigating the Tailhook incident almost 20 years, we made the recommendation that manager training was essential to stopping that improper behavior.  When VBA does provide training at the RO level, the quality is poor, because so many of the trainers are inexperienced and not subject matter experts.

I recommend that more training of the file clerks and the claims examiners, in the mail room who are the first in line to receive veterans' documents in evidence.  They work under constant production pressures.  Mistakes will continue to be made if the training does not get better.

The employees in my office have not been given any page, stamps, cover sheets, or other tools for discarding documents more quickly.  We have to mark every piece of paper that we discard with our initials and the reasons for shredding it. 

The shredding problem has also resulted in a large number of unfair terminations and disciplinary actions.  I am currently appealing the reprimand of a young lady who was accused of unintentionally shredding a veteran's original document.  Even though the evidence was weak, management told us that this is a very high visibility case, so they must go forward with the reprimand. 

We are very pleased that Congress has provided VBA with the funds to hire thousands of new veterans to address this backlog.  But it is heartbreaking and frustrating to see so many new hires fired during their probationary period. 

Finally, much of the problems of lost and tampered files could be solved by VBA going paperless.  There are so many Iraqi and Afghanistan veterans who need jobs and would be proud to join the VBA workforce to do the document scanning and other work to help VBA go paperless.

Thank you.

[The prepared statement of Ms. Moore appears in the Appendix.]

Mr. HALL.  Thank you, Ms. Moore.  Thank you for your service as well as your service to our veterans.

Ms. MOORE.  Thank you.

Mr. HALL.  Thanks to all of our panelists for your service and for your service to our veterans. 

Let me just start off.  My first question is for Mr. Baker.  In general what does a service officer do when he or she cannot locate a claim folder or they suspect a file has been tampered with by the VA?

Mr. BAKER.  Well as a national service officer (NSO) in a field office, we have about 250 plus NSOs that man every Regional Office in the country.  Our ability is limited.  Once we believe something is missing, and we can't confirm, for example, an entire claims folder is missing.  We need the VA to help us do that.  But if it has been confirmed that a claims folder in its entirety is missing, we have no choice at that point but to rely on VA to start the rebuilding procedure for that folder.  Now some of that will come from the service organizations, some of it will come from the clamant.  They will go out to various centers, wherever that person sought medical treatment, and try to rebuild as much of that claims folder as possible.  It is a difficult process, because some of the records are simply irretrievable, some of them are irreplaceable. 

If we feel—now that is a missing claims file.  If we feel evidence is missing that maybe we have submitted, we have a tracking system in our case management program that tells us everything we have done for a particular claimant.  And we can pull up submittal letters, which are attached to medical evidence that we have copies of.  We can take it to VA.  And at least if we can get that particular claimant to come back up with the evidence, unfortunately sometimes they have to come back up with it again, we can show by our records that we did submit it to the VA.  And, you know, the VA can't then say that they never got the evidence.  We can prove that they got the evidence.  And as far as effective date purposes or a few other things, you know, that kind of—that kind of partnership can come together for a good outcome. 

But if, you know, almost half or maybe more than half of the claimants out there are not represented, you wouldn't get that kind of benefit.

Mr. HALL.  Thank you, Mr. Baker.  One more question for you.  In your testimony you categorized incidents with shredding as "unlawful destruction" and suggested that there be fines or imprisonment for guilty employees. 

Are you suggesting that title 38 should be amended?  What about managers who do not comport with VA regulations that are complicit in improperly handling documents?

Mr. BAKER.  I don't want to—I don't want my recommendation to be taken too much out of context.  I mean, if it is found that somebody has illegally destroyed records, I believe that they should be prosecuted under title 18. 

Right now there are many provisions in title 38 that require VA to prosecute a veteran, a veterans' representative, a VA employee if they fraudulent—commit fraud against the government to obtain benefits.  But there is nothing in title 38 that mandates VA prosecute a VA employee if they commit fraud against a claimant to withhold benefits.

Mr. HALL.  Right.  So in other words, if there is prosecution or punishment of some kind for overpaying or paying unnecessarily then there also should be balance.  And there should be similar—

Mr. BAKER.  There should be balance.

Mr. HALL [continuing].  —sanctions for not paying.

Mr. BAKER.  And that is not to say VA can't prosecute them under title 18 now.

Mr. HALL.  Right.

Mr. BAKER.  But various circumstances mandate that they prosecute other instances under title 18.

Mr. HALL.  Have you made your recommendation for imaging centers to the VA?

Mr. BAKER.  I have now. 

Mr. HALL.  Okay.  I think everybody here sort of echoes that recommendation. 

I want to ask Mr. Abrams.  It seems that you agreed that the work credit system currently in place incentivizes employees to take short cuts.  I love the Lucy and Ethel picture.  And I would also agree that measuring for quality and accuracy could improve the system.  How would you suggest that that be implemented and what about production?

Mr. ABRAMS.  Well, I think we should reward managers who are able to supervise people who do work well and do lots of work.  Once we get started on that track, people will be promoted who are good, who do work well, and the VA will have to accept that it will have to report numbers to Congress and to the public that show it takes longer to do a claim in the first instance than what they expect now.  It will be shorter over all.  The backlog will go down.  But it will take longer to do the claim right in the first instance. 

And that was why in my formal testimony I said we should give amnesty to the managers now, because the statistics that you are going to get, if they are honest, are going to shock you, just like you were shocked in the OIG report.  There are cases that are in drawers now that are going to have to come out.  And you are going to see old, old claims.  And that is going to have to get on the table in order to know where we are to get better. 

Mr. HALL.  Thank you, Mr. Abrams.  I am sorry I have—I am running out of time here in this round.  But I want to ask Ms. Witt.  In your experience with the legislation that we passed last year creating the New Survivor Office at the VA, has Gold Star Wives called—asked the VA to call survivors when needing to retrieve funds, and if so what was the VA's response?

Ms. WITT.  We have not asked them to do that.  I think it would be an extremely good idea if they did. 

Mr. HALL.  This is all a work in progress.  That legislation is fairly recent.  We have a new Secretary, and there will be new direction coming from the top leadership at the VA.  So I presume that these things should start to happen and the office is to be fully staffed.  And we will see changes.  But that would be probably a wise thing to do.

Ms. WITT.  We have already seen significant progress from the VA office.

Mr. HALL.  Ms. Moore, does the AFGE train employees in how to report unethical or improper document handling if they witness it in the field?

Ms. MOORE.  Yes, sir, absolutely.  We have a training program in place now that does train the AFGE leadership to report mishandling of documents and shredding, illegal shredding. 

Mr. HALL.  What process is used to determine if an employee has intentionally engaged in that behavior?

Ms. MOORE.  Well, actually what happens is that it is reported to the managers, management, upper-level management when it is brought to AFGE's attention, we have to go through management.

Mr. HALL.  Thank you very much.  I would like to recognize Mr. Mitchell, the Chairman of the Subcommittee on Oversight and Investigations.

Mr. MITCHELL.  Thank you.  Mr. Baker, in her testimony the VA's Assistant Inspector General for Audit tells us the so called mail amnesties in Detroit and New York uncovered 16,000 pieces of mail and other documents that had not been processed.

I have a three-part question.  Had you ever heard of these mail amnesties for one?  And secondly, how often do veterans tell you that they have submitted paperwork to the VA, and that they had to resubmit the same paperwork?  And third, how well does the VA deal with these situations?

Mr. BAKER.  I have never heard of the amnesty until now.  Hearing it when you mentioned it earlier was the first time.  I was shocked to hear tha