Mr. Frank Logalbo
Chairman Runyan, Ranking Member McNerney, and Members of the Subcommittee:
Thank you for holding this hearing on VA’s rating schedule and for inviting Wounded Warrior Project (WWP) to provide testimony.
This hearing is both timely and important given the responsibility of the Secretary of Veterans Affairs to “adopt and apply a schedule of ratings of reductions in earning capacity from specific injuries or combinations of injuries...based as far as practicable, upon the average impairment of earning capacity resulting from such injuries in civil occupations…[and] from time to readjust this schedule of ratings in accordance with experience.”
As you know, VA’s disability rating schedule has not been comprehensively revised or updated since 1945. Congress recognized the troubling implications of that gap in creating the Veterans’ Disability Benefits Commission. Importantly, among the Commission’s recommendations in its 2007 report were that VA “benefits and standards for determining benefits should be updated or adapted frequently based on changes in the economic and social impact of disability and impairment, advances in medical knowledge and technology, and the evolving nature of warfare and military service. Building on the Commission’s findings and recommendations, Congress wisely directed VA to establish an Advisory Committee on Disability Compensation to advise the Secretary on the maintenance and periodic readjustment of the schedule of rating disabilities. That Committee is playing a vital role in monitoring, questioning, and advising VA as it is working to update the disability rating schedule.
WWP brings a special perspective to this subject, reflecting its founding principle of warriors helping warriors. We pride ourselves on outstanding service programs that advance that ethic. Among those program efforts, WWP staff across the country work daily to help Wounded Warriors understand their entitlements and fully pursue VA benefits’ claims. But our goal is broader: to ensure that this is the most successful, well-adjusted generation of veterans in our nation’s history.
Unique Impact of Mental Health Disability
From that perspective, we believe that perhaps no aspect of VA’s work on modernizing its rating schedule may be more important than to bring the evaluation and rating of mental health conditions into the 21st century. It is very clear to us at WWP that combat-related mental health conditions are not only highly prevalent among OEF/OIF veterans and often severely disabling, but they have profound consequences for warriors’ overall health, well-being, and economic adjustment. We see this in our day-to-day work with Wounded Warriors. Moreover, the annual surveys that WWP has conducted in partnership with RAND have confirmed those impressions, and provided us important data.
WWP’s most recently completed survey of more than 5800 servicemembers and veterans wounded after 9/11 found that one in three of the more than 2300 respondents reported that mental health issues made it difficult to obtain employment or hold jobs. Almost two-thirds of those surveyed reported that emotional problems had substantially interfered with work or regular activities during the previous four weeks. And more than 62 percent indicated they were experiencing current depression (compared to a rate of 8.6 percent in the general population, and an earlier RAND projection of nearly 14 percent among OEF/OIF veterans generally). Only 8 percent of respondents did not experience mental health concerns since deployment. Of those surveyed, post-traumatic stress disorder was their most commonly identified health problem. Questioned about their experience in theater, 83 percent had a friend who was seriously wounded or killed; 78 percent witnessed an accident that resulted in serious injury or death; 77 percent saw dead or seriously injured non-combatants; and 63 percent experienced six or more of these types of traumatic incidents.
Asked to comment on the most challenging aspect of their transition, some two in five of those surveyed cited mental health issues. Their words are telling:
“I’ve been dealing with PTSD/Depression for many years now and it just seems to never go away. It affects my day to day activities. I seem to have lost my self purpose and interest.”
“My main problems are being emotionally numb, isolation, freezing up in social environments, drugs and not having the desire or energy to put towards changing my situation any more. It has been over 5 years, and I am still just as bad as and even worse than when I came back.”
“My greatest challenge is the feeling of uselessness and helplessness of coping with a mental illness.”
Some acknowledged finding help from VA therapists and clinics. Others had less positive experiences – commenting, for example, “the VA is overwhelmed at this point and discouraging for young troopers seeking care…Too much medicine gets thrown at you. Each provider thinks they can solve the complex issue of PTSD/Combat Stress with meds.” Overall, our Wounded Warriors’ battles with mental health issues underscore the importance not only of addressing substantial gaps in VA health care but significant challenges for the Veterans Benefits Administration.
Given the strong link between veterans’ mental health and their achieving economic empowerment, it is vital that compensation for service-incurred mental health conditions be equitable and make up for lost earning power. But deep flaws in both VA evaluation procedures and its rating criteria pose real problems for warriors bearing psychic combat wounds.
Veterans seeking compensation for a mental health condition typically undergo a compensation and pension (C&P) examination, which is intended to develop documentation for disability-evaluation purposes, to include determining the severity of the condition. Where the examination and other pertinent evidence establishes a basis for a grant of service-connection for a mental health condition, adjudicators determine the level of compensation to be awarded by evaluating examination findings by reference to criteria for rating mental health disorders that have been codified in federal regulation at 38 CFR sec. 4.130.
Flawed Mental Health Rating Criteria
To its credit, VA has acknowledged that its criteria for rating mental health disorders for compensation purposes need thoroughgoing revision, and officials have stated that major studies agree that mental health issues have a greater impact on earnings than VA for which is currently compensating.
Major changes are needed. An expert panel convened by the Institute of Medicine (focused specifically on PTSD) characterized VA’s schedule of ratings for mental disorders (which is a single set of criteria for rating all mental disorders except eating disorders) as a crude, overly general instrument for assessing PTSD disability. The IOM panel cited two major limitations in the rating criteria: first that it lumps everything into a single scheme, allowing for very little differentiation across specific conditions; second that occupational and social impairment is the driving factor for each level of disability, omitting consideration of secondary factors (such as frequency of symptoms or treatment intensity) used in rating physical disorders.
The criteria’s reliance on occupational and social impairment departs in a very fundamental way from the core principle that disability ratings are to be based on average impairments of earning capacity. No other disability is rated by reference to “occupational impairment,” and in any other instance under the rating criteria the actual impact of a veteran’s occupational functioning would be irrelevant. The emphasis on occupational impairment throughout the criteria for rating mental disorders places the focus inappropriately on the individual veteran’s capacity for employment, rather than on average impairment of earning capacity. We concur with the IOM panel’s view that eliminating occupational impairment as the defining factor in rating mental health conditions would result in greater parity between the rating of mental and physical disorders. It could also remove the disincentive to seeking gainful employment.
The mental health rating criteria are also unreasonably high. By way of example, the criteria for a 100% schedular rating require:
“total occupational and social impairment, due to such symptoms as: gross impairment in thought processes or communication; persistent delusions or hallucinations; grossly inappropriate behavior; persistent danger of hurting self or others; intermittent inability to perform activities of daily living (including maintenance of minimal personal hygiene); disorientation to time or place; memory loss for names of close relatives, own occupation, or own name.”
With such elements as “persistent danger of hurting self or others,” the criteria more closely resemble the degree of impairment associated with psychiatric hospitalization or other institutional care than simply severe functional impairment. In other respects, the criteria describe such profound impairment as to render the individual unable to perform self-care. As such, they closely reflect the very high degree of impairment associated with eligibility for special monthly compensation based on a need for aid and attendance of another person. Surely an individual who manifests “gross impairment in thought processes or communication,” “persistent delusions or hallucinations,” “grossly inappropriate behavior,” “persistent danger of hurting self or others,” or “disorientation to time or place,” is in need of ongoing protective care. To set so high a bar for a 100% rating for a mental health disorder is not simply to blur the line between the 100% rating and the criteria for aid and attendance, but virtually to erase it. The criteria for a 100 percent rating (and lesser percentage ratings) must be relaxed. But regulatory changes should also be made to ensure that veterans whose mental health status is as severely impaired as now reflected in the criteria for a 100% rating can receive special monthly compensation.
If mental disorders are to be rated under a single set of criteria, VA must enable adjudicators to take account of the many ways in which mental illness may manifest itself. For example, while the criteria for a 100% rating are intended to be applied to rate a very wide range of illnesses, they focus narrowly on profound schizophrenia. As such, they provide virtually no basis for assigning a 100% rating for such widely prevalent and often profoundly disabling conditions as major depression, PTSD, and anxiety.
Finally, VA must ensure that compensation for mental health conditions replaces average loss in earnings capacity. Today it does not! As carefully documented in a detailed 2007 report to the Veterans Disability Benefits Commission (“the CNA Report”), it is important in assessing whether compensation replaces average lost earnings to distinguish between physical and mental disabilities. The CNA Report shows that average VA compensation for physical disabilities approximated lost earnings based on nonservice-connected peer group earnings. In contrast, however, for veterans whose primary disability was a mental condition VA compensation fell below lost earnings, and for those who were severely disabled at a young age VA compensation fell substantially below lost earnings. Similarly, CNA found substantial employment rate differentials between veterans with a primary physical disability and those with a mental one, with the average employment rate of service-disabled veterans with a mental health condition markedly lower than for veterans with a physical condition.
In our view, VA must completely rewrite its rating criteria for mental disorders with the goal of fairness, reliability, and accuracy. In doing so, it must abandon principal reliance on occupational impairment, which has the effect of discouraging veterans from pursuing gainful employment and from achieving overall wellness. Criteria that evaluate disability on the basis of the applicable domain or domains that most affect an individual (as reflected in the rating criteria for traumatic brain injury, for example) offer a possible model for achieving greater reliability. Any such criteria must also reflect how disabling mental disorders actually are.
Risk of Error in C&P Examinations
But even the most thoroughgoing revision of VA’s criteria for rating PTSD, or mental disorders generally, will not by itself result in fair, accurate compensation awards. Currently, the claims-adjudication process relies heavily on an examination conducted by a psychologist or psychiatrist who typically has never met (let alone treated) the veteran before. In addition, VA C&P examinations of mental health conditions have long been criticized as superficial, and routinely fall far short of a VA best-practice manual, which suggests such an examination can take three or more hours to complete. Years-old problems of too-hurried VA compensation examinations have not abated.
In response to a survey WWP conducted last year, more than one in five Wounded Warriors reported that VA C&P examination associated with the adjudication of their original PTSD claim was 30 minutes or less in duration. A recent VHA-conducted survey of its mental health clinicians found that over 26 percent of responding mental health providers said the need to perform compensation and pension examinations pulled them away from patient care. Hurried, or less than comprehensive, C&P examinations heighten the risk of adverse outcomes, additional appeals, and long delays in veterans receiving benefits. It bears noting that meaningful evaluation of a mental health condition requires a painstaking inquiry that often depends on developing a trusted relationship with a client, on probing inquiry, and on sustained dialogue. A brief, one-time office visit with a stranger is hardly conducive to such an encounter, and – disconnected from the claimant’s community, home, and workplace or school, as applicable -- provides only the most distant impression of the extent of disability.
VA mental-health compensation determinations should be based on the best evidence of a veteran’s functional impairment associated with that service-connected condition. As such, we believe it is important to recognize the inherent limitations of C&P mental health examinations. An adjudication system aimed at accurately assessing functional impairment of a disabling mental health condition should seek a more reliable basis for assessment.
We urge this Committee to press VA to revise current policy and give much greater weight to the findings of mental health professionals who are treating the veteran, and are necessarily far more knowledgeable about his or her circumstances. To the extent that VA must still rely on C&P exams, strict measures should be instituted to ensure much more thorough, reliable exams.
We believe there is yet another area in which VA compensation policy should be modernized. In this instance one of VA’s compensation regulations has the effect of impeding many wounded veterans – particularly those with service-incurred mental health conditions -- from overcoming disability and regaining productive life. By way of background, VA regulations have long provided a mechanism to address the situation where the rating schedule would assign a less than a 100% rating, but the veteran is nevertheless unable to work because of that service-connected condition. In instances where a veteran has a disability rating of 60 percent of or more, or at least one disability ratable at 40 percent or more and sufficient additional disability to bring the combined rating to 70 percent or more, VA may grant a 100% disability rating when it determines the veteran is “unable to follow a substantially gainful occupation as a result of service connected disabilities.” This Individual Unemployability (IU) rating results in a very substantial increase in the veteran’s compensation.
While veterans receiving IU are compensated at the same monetary level as those who receive a 100% rating, the implications for employment drastically differ. A veteran who receives a schedular rating of 100% for a disability other than a mental health condition is not precluded from gainful employment. But for veterans receiving IU, engaging in a substantially gainful occupation for a period of 12 consecutive months can result in a loss of IU benefits and a subsequent reduction in compensation benefits. For some veterans, this can spell a sudden loss of as much as $1700 in monthly income. Both the Institute of Medicine (IOM) and Veterans’ Disability Benefits Commission have recognized this decrease as a “cash-cliff” that may deter some veterans from attempting to re-enter the workforce.
We concur with the recommendations of the IOM and Veterans’ Disability Benefits Commission that the IU benefit should be restructured to encourage veterans to reenter the workforce. The experience of the Social Security Administration (SSA) – which has had success piloting a gradual, step-down approach to reducing benefits for beneficiaries who return to employment – offers a helpful model. SSA’s experience has shown that, for those reentering the workplace, a gradual rather than sudden reduction in disability benefits not only allowed participants to minimize the financial risk of returning to work, but over time participants actually increased their earning levels above what they would have received in disability payments. Inherent in this approach is the underlying assumption that individuals with disabilities can and will re-enter the workforce if benefits are structured to encourage that opportunity.
Recognizing that employment often acts as a powerful tool in recovery and is an important aspect of community reintegration for this young generation of warriors, we believe VA should revise the IU benefit to foster those goals.
Compensation for service-connected disability is not only an earned benefit, it is critically important to most veterans’ reintegration and economic empowerment, and particularly so for those struggling with the psychic wounds of war. VA has much work to do to make compensation for combat-related mental health conditions as fair as it should be. We look forward to working with the Department and this Subcommittee to realize that goal.
 38 U.S.C. sec. 1155.
 National Defense Authorization Act of 2004, Public Law 108-136.
 Veterans’ Disability Benefits Commission Report, Honoring the Call to Duty: Veterans’ Disability Benefits in the 21st Century, p. 4 (2007).
 Public Law 110-389 (October 10, 2008).
 WWP Survey, p. 67. In contrast to the one in three so responding, only about one in five identified “not physically capable” and “not qualified/lack of education” as creating greatest difficulty.
 Id., p. 34.
 Id., p. 41.
 Id., p. 53.
 Id., p. ii.
 Id., p. 16.
 Id., pp. 83-4.
 Id., p. 90. Recent studies document the widespread off-label VA use of antipsychotic drugs to treat symptoms of PTSD, despite the recent finding that one such medication is no more effective than a placebo in reducing PTSD symptoms. Leslie, D., Mohamed, S., & Rosenheck, R., “Off-Label Use of Antipsychotic Medications in the Department of Veterans Affairs Health Care System” Psychiatric Services, 60 (9), (2009) 1175-1181; Krystal, John H.; et al. (2011) “Adjunctive Risperidone Treatment for Antidepressant-Resistant Symptoms of Chronic Military Service–Related PTSD: A Randomized Trial,” JAMA ; 306(5), (August 3, 2011) 493-502.
 The Veterans Benefits Administration and Veterans Health Administration sponsored a “Mental Health Forum” on January 28-29, 2010 to begin a dialogue and process aimed at rulemaking to revise the rating criteria for mental disorders.
 Committee on Veterans’ Compensation for Posttraumatic Stress Disorder, “PTSD Compensation and Military Service,” National Academies Press (2007), p. 6.
 Id., at 156.
 38 U.S.C. sec. 1155.
 Committee on Veterans’ Compensation for Posttraumatic Stress Disorder, “PTSD Compensation and Military Service,” p. 157.
 “…need for regular aid and attendance [due to]…incapacity, physical or mental, which requires care or assistance on a regular basis to protect the claimant from the hazards or dangers incident to his or her daily environment.” 38 C.F.R. sec. 3.352(a).
 Given that the rating schedule sets so unreasonably high a level of impairment for a 100% rating, it is not surprising that the 70%, 50% and other rating levels also set the bar at unreasonably high points. To illustrate, an individual who experiences “near continuous panic or depression”, “inability to establish or maintain effective relationships,” “difficulty in adapting to stressful circumstances,” and “neglect of personal appearance and hygiene,” – symptoms now entitling one to a 70% rating – cannot realistically be considered able to hold a job. It is hardly surprising, therefore, that a high percentage of veterans with a schedular 70% rating for a mental disorder receive a total disability rating based on individual unemployability. Likewise, the criteria for a 50% rating – impaired memory, judgment and thinking; difficulty in understanding complex demands, mood disturbance, weekly panic attacks, and difficulty in establishing and maintaining effective relationships – seem hardly consistent with the notion that such individuals, on average, have lost only half of their earning capacity. In short, these are not equitable criteria; they dramatically under-rate the extent of disability and earning capacity.
 CNA Corp., “Final Report for the Veterans’ Disability Benefits Commission: Compensation, Survey Results, and Selected Topics (August 2007), 3-4. Accessed at http://www.cna.org/documents/D0016570.A2.pdf.
 Id., 48.
 An Institute of Medicine (IOM) study on PTSD compensation reflected concern that VA mental health professionals often fail to adhere to recommended examination protocols. As an IOM panel member described it at a congressional hearing, “Testimony presented to our committee indicated that clinicians often feel pressured to severely constrain the time that they devote to conducting a PTSD Compensation and Pension (“C&P”) examination—sometimes as little as 20 minutes—even though the protocol suggested in a best practice manual developed by the VA National Center for PTSD can take three hours or more to properly complete.” (Dean G. Kilpatrick, Ph.D., Committee on Veterans’ Compensation for Posttraumatic Stress Disorder, Institute of Medicine, Testimony before House Veterans’ Affairs Committee Hearing on “The U.S. Department of Veterans Affairs Schedule for Rating Disabilities” Feb. 6, 2008, accessed at: http://veterans.house.gov/hearings/Testimony.aspx?TID=638&Newsid=2075&Name=%20Dean%20G.%20Kilpatrick,%20Ph.D.
 Chairman Patty Murray, Letter to Robert A. Petzel, Under Secretary for Health, Department of Veterans Affairs (October 3, 2011).
See Gold, et al. “AAPL Practice Guidelines for the Forensic Evaluation of Psychiatric Disability,” Journal of the American Academy of Psychiatry and the Law, (2008) 36: S3-S49.
 38 C.F.R. sec. 3.343(c).
 Institute of Medicine, A 21st Century System for Evaluating Veterans for Disability Benefits. Committee on Medical Evaluation of Veterans for Disability Compensation, National Academies Press, 2007, 250, and Veterans’ Disability Benefits Commission, Honoring the Call to Duty: Veterans Disability Benefits in the 21st Century, October 2007, 243.
 Social Security Administration, “Benefit Offset Pilot Demonstration – Connecticut Final Report.” September 2009, accessed at: http://www.ssa.gov/disabilityresearch/offsetpilot.htm