Report: VA's claims system a mess

Poor service, intolerable delays, personnel shortages and incompatible computer systems have resulted in a claims backlog crisis for the nation's veterans, according to a new report by a special task force.

The report, by the Department of Veterans Affairs Claims Processing Task Force, found no easy answers to a problem that has been growing for a decade and that the biggest losers are the veterans themselves, whose claims sometimes take more than a year to process.

The Veterans Benefits Administration (VBA) "is in a workload crisis," the report said. Currently, the VBA has a backlog of 533,029 claims for medical disabilities, pensions, survivor payments and other benefits. It takes the VA an average of 200 days to process claims, and an estimated 56,000 claims have languished for more than a year. The report, ordered by VA Secretary Anthony Principi, comes at a time when the agency has frozen new information technology contract awards and is developing an enterprise architecture plan to make the agency more efficient. In fact, these actions were among the numerous recommendations the task force made in its report.

The report said that IT is a "critical component in processing veterans' claims" but said that IT is not a solution in and of itself. "Capacity of technology and the understanding of how technology can be integrated within the claims process are mandatory," the report said.

But fixes must go beyond technology. "We are not just working with file folders and streams of electrons; the nexus of our process is people, not paper," Principi said when he received the report Oct. 3. "When we tailor our software, our management principles and our corporate philosophy to meet the practical needs of employees who are doing their level best to meet the burgeoning demands of claims' processing—then we will be on course toward meeting the real needs of America's veterans," he added.

The report details at length areas that need attention, said John McNeill, assistant director for benefits policies at the Veterans of Foreign Wars. Eventually, the VA will need to turn to electronic filing to save time and money, he noted.

"Electronic claims filing is really the way you have to go. I don't think you will get rid of paper processing, but we want to deal in electronic filing," he said.

The VA has taken some steps toward allowing veterans to file their claims online and has more ideas in the works. But as McNeill noted, "We have a lot of veterans who go to Florida for the winter, and their files stay up north."

"Secretary Principi is dedicated to making sure the recommendations will be followed through in the VA and on Capitol Hill," said Dale Block, a Pittsburgh physician who treats many veterans and was a member of the task force. "One of the things we were charged to do was to see how to effectuate change immediately as it relates to delays in claims processing. We identified key initiatives, including enhancements of information technology at the VA," Block said. But the report criticized the VBA for creating its own problems through poor or incomplete planning. The VBA cut the number of skilled workers to handle processing while diverting experienced staff to implement poorly planned changes, the report said.

To complicate matters, the task force said the VBA must analyze more than 24.5 million pieces of mail each year, respond to more than 9 million phone calls and handle more than 5.5 million claim folders in regional offices.

The problem will only get worse, the report said. The number of veterans age 85 and older is expected to more than double to at least 1.23 million in 2010.

The task force recommended freeing more VA personnel to handle high priority claims and eliminating some tasks to focus on processing claims, as a start.

Room To improve

The Department of Veterans Affairs Claims Processing Task Force made 20 short-term and 14 medium-term recommendations designed to improve the agency's claims processing.

They include:

* Accelerate resolution of any case more than 1 year old.

* Centralize employee training.

* Assign more staff to higher priority cases.

* Delay new information technology initiatives until the claims workload is under control.

* Allocate more resources to high-performance regional offices.

* Hold the Veterans Benefits Administration accountable to measurable performance standards.

* Establish call centers.

* Develop an IT solution for the VBA's benefit delivery system and integrate the VBA's IT systems with other department systems.

* Determine the viability of the Veterans Service Network, the VBA's payment system.

* Impose change management.

* Establish specialized claims processing teams.

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