At the end of fiscal year 2015, according to VA data, VA had  over 427,000 pending appeals, approximately 81,000 of which were at  the Board. About 20 percent of this growth occurred from fiscal year  2014 through 2015. In addition, the proportion of  cases taking the longest to resolve (from when the Board receives the  certified appeal to them making a final decision)—over 600 days— increased from 10 percent in fiscal year 2011 to 14 percent in fiscal year  2015 (see fig. VA Has Proposed Increased Staffing, Process Reform, and Updated IT to Improve Appeals Timeliness, and Has Taken Action for All Three Approaches

VA has identified three broad approaches for addressing factors that it  identified as having contributed to increased appeal inventories and  reduced timeliness of appeals decisions, and has already taken action on  all three fronts. Citing staffing levels that have not kept pace with  workloads, VA secured additional Board staff for fiscal year 2017, and  analyzed options for another hiring surge in fiscal 2018. VA Proposed Hiring More Staff to Address Increasing Workloads

VA has proposed increasing staff at the Board, as well as VBA, to  manage its increasing inventory of appeals and to address related  declines in the timeliness of appeals resolutions. Specifically, as of October 2016, VA projected that if nothing else  changes, and if the number of FTEs hold steady at the fiscal year 2017  number (922 FTEs for the Board and 1,495 for VBA), the inventory of  appeals could exceed 1 million in fiscal year 2026, which would mean that  veterans would wait an average of 8.5 years for a final appeals decision. To understand the need for and implications of a future hiring surge, VA  modeled different staffing scenarios. Board and VSO officials also identified factors within VBA’s initial claim  process—and outside of the Board’s control—that cause delays in  veterans receiving final decisions on their appeal. Unlike the current process, in which the Board may remand  appeals to VBA to consider new evidence, the Board would only  remand appeals under the new process in cases in which the Board  found that VBA failed, in its initial or supplemental claim processing, to  meet VA’s “duty to assist” the veteran. VA Applied Several Sound Planning Practices in Its Efforts to Improve Its Appeals Processing Timeliness, but Fell Short in Other Areas

		VA Weighed Several Factors When Determining Its Need for More Staff, but Did Not Fully Assess Risks or Document Its Workforce Plans

VA acted consistently with sound planning practices in determining its  need for additional staff, but it did not fully consider risks and  uncertainties in its approach. Because the Board did not consider  alternate sets of assumptions, VA does not know the potential effect that  variations in these key variables could have on staffing needs. VA also identified strategies and resources needed for recruiting, hiring,  and training staff in fiscal year 2017; however, aspects of VA’s workforce  planning fall short of sound workforce planning practices that suggest  having timely written plans with a systematic approach and detailed  steps, time frames, and mitigation strategies to help identify where  resources and investments should be targeted. Recruitment and Hiring: Consistent with sound workforce planning  practices, officials have worked to develop a center for excellence in  hiring to coordinate workforce planning and develop strategies for  recruiting and hiring staff quickly. However, in  November 2016, officials reported that the Board was still in the  process of updating various aspects of its training curriculum, such as  how to support conducting work in a virtual environment, which is  consistent with the agency’s plans to increase telework as a way to  manage space restrictions for new staff. VA Collaborated with Stakeholders in Developing Its Proposed Streamlined Appeals Framework, but Lacks Strategies, Such as Pilot Testing, to Mitigate Risks

VA collaborated with key stakeholders in developing its proposed appeals  process reform framework and related implementation plans, which is  consistent with sound practices for business process redesign. Sound practices for process redesign and change management also  suggest having risk mitigation strategies—in particular, pilot testing—to  ensure moving successfully to full implementation. VA’s rationale for not pilot testing centers on what they describe  as widespread consensus that the current process is “fundamentally  broken” and provides “inadequate service to veterans with a high  percentage of wasted effort.” VA assumed that a pilot test authorized by  Congress would include a sunset date with a default reversion to the  current system, which they said would introduce uncertainty into the  agency’s planning efforts and a reliance on subsequent, time consuming  legislation before the conclusion of the pilot. VA Has Taken Steps Consistent With Sound Planning Practices while Updating Its IT, but Lacks Clear Schedules for Implementing IT Updates

VA has generally planned the implementation of its Caseflow appeals  system consistent with sound planning practices. Additionally, VA does not have any plans to pilot test its proposal—a  sound and often necessary practice for experiencing, evaluating, and  refining significant institutional change on a smaller scale prior to full  implementation. At the same time, VA plans for hiring more staff and  upgrading IT lack key details (for example, on how VA will train and find  working space for new staff, or a schedule for when and how system  changes might be integrated with the proposed streamlined process),  exposing VA to risks of delays, inefficiencies, or other setbacks caused by  not anticipating needs or a misalignment of efforts. Matter for Congressional Consideration

To improve VA’s ability to successfully implement appeals process  reform, Congress should consider requiring that reforms of the VA  disability appeals process be subject to a pilot test. Ensure development of a timely, detailed workforce plan for recruiting,  hiring and training new hires. Develop a strategy for assessing process reform—relative to the  current process—that ensures transparency in reporting to Congress  and the public on the extent to which VA is improving veterans’  experiences with its disability appeals process. While it is true that VA  has made noteworthy progress developing an implementation plan to  guide its efforts, we found the plan lacked important details, such as: how  VA will monitor for interim success and trouble spots, including whether  the agency has appropriately distributed resources among the new and  old processes; how it will mitigate risk of implementation challenges or  setbacks, and reduce their negative impact; and how it will measure  whether the new process is improving overall appeals resolution  timeliness from the veteran’s perspective. VA disagreed with a draft recommendation that it incorporate pilot testing  of its proposed appeals process into implementation plans and pursue  necessary legislative authority. In its comments, VA noted that the  appeals process is broken and that piloting a new process would result in  further delays to veterans appealing their disability decisions. We believe that the potentially negative consequences of  delaying full implementation are far outweighed by the benefits that can  be realized through piloting. In light of VA’s disagreement with our draft  recommendation, we removed the recommendation and now pose a  matter for congressional consideration. VA noted that, in addition to currently implementing  a fiscal year 2017 workforce plan to hire additional staff, as discussed in  the report, among other efforts it has recently launched new attorney  training and continues to collaborate across the agency to identify space  where new staff can be located. We believe additional action is needed to meet the intent of this  recommendation; we also clarified the recommendation language to state  that VA needs a more detailed plan. While it is true that the agile  process can help mitigate risks and avoid cost overruns and delays, we  do not believe this approach precludes VA from taking additional steps to  consider the scope of potential changes required by a new appeals  process and have a broad plan in place to ensure that all aspects of the  new process are adequately supported by Caseflow. VA concurred in principle with our recommendation to develop a more  robust plan for closely monitoring the implementation of its process  reform, that includes metrics and interim goals to help VA track progress,  evaluate efficiency and effectiveness, and pinpoint trouble spots. Further, because VA’s approach does not allow VA to compare the new  process with the old or to determine whether the new process represents  an improvement over the old process, we believe it does not promote  transparency in reporting to the Congress and the public.
Why GAO Did This Study

VA compensates veterans for disabling conditions incurred in or aggravated by military service. Veterans can appeal VBA's decisions on their compensation claims, first to VBA and then to the Board, a separate agency within VA. In fiscal year 2015, more than 427,000 appeals were pending and veterans waited over 3 years on average for decisions. Of this total, about 81,000 were pending at the Board and the average cumulative time veterans waited for a decision by the Board in 2015 was almost 5 years.
This report examines VA's approaches to address challenges it identified as contributing to lengthy appeals processing times, and the extent to which those approaches are consistent with sound planning practices.
GAO focused mainly on the Board, which experienced an increase in workload of about 20 percent from fiscal year 2014 to 2015. GAO reviewed VA's proposed plans and actions and compared them to sound practices relevant to workforce planning and implementing process redesign and new information technology identified in federal guidance, such as internal control standards, and prior GAO work. GAO also analyzed VA's data for fiscal years 2011-2015 (the most recent available) on appeals decision timeliness and workloads; reviewed relevant federal laws, regulations, and planning documents; and interviewed VA officials and veterans service organizations.

What GAO Found

The Department of Veterans Affairs' (VA) is taking steps to improve the timeliness of its benefit compensation appeals process, in which veterans who are dissatisfied with claims decisions by the Veterans Benefits Administration (VBA) can appeal first to VBA, and then to the Board of Veterans' Appeals (the Board). VA has taken actions related to increasing staff, reforming the process, and updating information technology (IT), which are consistent with relevant sound planning practices. However, gaps in planning exist, thereby reducing the agency's ability to ensure that these actions will improve the timeliness of disability appeals decisions.
Increase staff : VA determined that staff resources have not sufficiently kept pace with increased pending appeals, and concluded that additional staff are needed, particularly at the Board, to improve timeliness and reduce its appeals inventory. The Board received approval to hire more staff in fiscal year 2017, and expects to need an additional hiring surge beginning in fiscal year 2018. As of October 2016, officials estimated that if the agency does not take any action, such as increasing staff in 2018, veterans may have to wait an average of 8.5 years by fiscal year 2026 to have their appeals resolved.
Consistent with sound workforce planning practices, VA modeled different options for increasing staff levels to support its conclusion that staff increases in conjunction with process change would reduce the appeals inventory sooner. However, contrary to sound practices, VA often used fixed estimates for key variables in its models—such as staff productivity—rather than a range of estimates (sensitivity analysis) to understand the effect variation in these key variables could have on staffing needs. Also, VA's written workforce plans—which cover recruiting, hiring and training—did not include detailed steps, time frames, and mitigation strategies consistent with sound workforce planning practices. For example, while VA has established a center for excellence in hiring to focus on recruitment and hiring the agency has not finalized training or telework plans or otherwise mitigated space constraints that it encountered for hiring staff in fiscal year 2017. Without a timely, detailed workforce plan, VA risks delays in hiring and preparing staff to help manage workloads as soon as possible.
Reform process: VA determined that new evidence—which a veteran can submit at any point during his or her appeal—inefficiently causes an additional round of reviews, and thus delays appeals decisions, and in response it proposed legislation (not enacted) to streamline the process. Consistent with sound practices for process redesign, VA worked with veterans service organizations (VSO) and other key stakeholders in developing the proposal, and continued to update VSOs about the development of its implementation plans.
VA's proposed reform is promising, but there are several gaps in its implementation plans. In particular, VA plans to fully implement appeals process reform at the Board as well as at VBA regional offices across the country while it concurrently manages the existing appeals inventory, a hiring surge, and planned system changes discussed below. However, VA's plans run counter to sound redesign practices that suggest pilot testing the process changes in a more limited fashion before full implementation, in order to manage risks and help ensure successful implementation of significant institutional change. VA officials told GAO that pilot testing—which would require legislation to implement—will prolong a process that is fundamentally broken and delay urgently needed repairs. However, without pilot testing VA may experience challenges and setbacks on a broader scale, which could undermine planned efficiencies and other intended outcomes. In addition, VA has not sufficiently identified how it will monitor progress, evaluate efficiency and effectiveness, identify trouble spots, and otherwise know whether implementation of its proposed process change is on track and meeting expectations. The absence of a robust monitoring plan with success criteria is inconsistent with sound planning practices for redesign and places the agency at risk of not being able to quickly identify and address setbacks. In addition, the timeliness measures that VA currently plans to report to Congress and the public lack transparency because they focus on individual parts of the agency and pieces of the new process rather than overall appeals resolution time from the veterans' perspective. Without a strategy for assessing the proposed new process that includes comprehensive measures, VA, the public, and Congress cannot know the extent to which the proposed process represents an improvement over the old process.
Update technology: VA determined that the computer system supporting its appeals process is outdated, prone to failures, and does not adequately support electronic claims processing. VA proposed a new IT system to reduce delays in appeals to the Board, and better integrate data from other systems. Consistent with sound practices, VA clearly laid out the scope and purpose of IT upgrades, and identified risks and strategies to mitigate them. However, the agency's plan lacks details for how and when its new system will be implemented, as suggested by sound planning practices for implementing new technology. Without a detailed schedule, VA risks not having new systems aligned with potential changes in the appeals process when they are implemented.

What GAO Recommends

GAO is making five recommendations to VA and one matter for congressional consideration. VA should: apply sensitivity analyses when projecting staff needs, develop a more timely and detailed workforce plan, develop a robust plan for monitoring process reform, develop a strategy for assessing process reform, and create a schedule for IT improvements that takes into account plans for potential process reform. VA concurred in principle with the five recommendations, but believes it has met the intent of those recommendations and does not need to take additional action. GAO disagrees and—while recognizing VA's ongoing efforts—believes further action is needed on all five recommendations to improve VA's ability to successfully implement reforms, as discussed in the report.
VA disagreed with an additional draft recommendation that it incorporate pilot testing of its proposed appeals process into implementation plans and pursue necessary legislative authority. VA cited its perspective that the appeals process is broken and that piloting a new process would result in further delays to veterans appealing their disability decisions. GAO maintains that the benefits of pilot testing—which provides an opportunity to resolve implementation challenges and make refinements to the process on a smaller scale—outweigh the potentially negative consequences of delaying full implementation. Therefore, GAO removed the recommendation and added a matter for congressional consideration stating that Congress should consider requiring that appeals process reform be subject to a pilot test.