1). In recent years, VA compensation claims processing timeframes have  increased. Specifically, the average days pending increased from 116  days in fiscal year 2009 to 254 days in fiscal year 2012. 2). In fiscal year 2011, VA  completed over 1 million compensation rating claims, a 6 percent  increase from fiscal year 2009. 3). As a result, the  number of backlogged claims—defined as those claims awaiting a  decision for more than 125 days—has increased substantially since 2009. One factor that contributed to the substantial increase in claims received  was the commencement in October 2010 of VBA’s adjudication of  260,000 previously denied and new claims when a presumptive service  connection was established for three additional Agent Orange diseases. VBA officials in  one regional office we spoke to said that all claims processing staff were  assigned solely to developing and rating Agent Orange claims for 4  months in 2011, and that no other new and pending claims in the regional  office’s inventory were processed during that time. According to VBA, other factors that contributed to  the growing number of claims include an increase in the number of  veterans from the military downsizing after 10 years of conflict in Iraq and  Afghanistan, improved outreach activities and transition services to  servicemembers and veterans, and difficult financial conditions for  veterans during the economic downturn. However, the  number of Statements of the Case that were processed by VBA was only  76,685. According to VBA officials, staff shortages represent a primary reason  that appeals timeliness at VA regional offices has worsened. According to VBA officials, delays in obtaining military service and  medical treatment records, particularly for National Guard and Reserve  members, have significantly lengthened the evidence gathering phase. If a veteran submits a disability claim and  reports receiving SSA disability benefits, VA is required to help the  veteran obtain relevant federal records, including certain SSA medical  records, to process the claim. VBA’s work processes, stemming mainly from its reliance on a paper- based claims system, can lead to misplaced or lost documents, and  contribute to lengthy processing times. VBA Is Taking Steps to Improve Claims and Appeals Processing, but Future Impact Is Uncertain

Based on a review of VA documents and interviews with VBA officials, we  identified 15 efforts with a stated goal of improving claims and appeals  timeliness. Contractor staff  are required to complete their work within 135 days of receiving the file  and provide VBA with status reports that include several measures of  timeliness, including the time it took to receive medical evidence from  providers and to return a claim to VBA for rating. Specifically, VBA provided us with several documents, including a  PowerPoint presentation and a matrix that provided a high-level overview  of over 40 initiatives, but, at the time of our review, could not provide us  with a robust plan that tied together the group of initiatives, their inter- relationships, and subsequent impact on claims and appeals processing  times. Implementation of Recommendations Could Help Improve Evidence Gathering and Ensure Better Strategic Management of Improvement Initiatives

In our December 2012 report, we recommended that VBA seek  improvements for partnering with relevant federal and state military  officials to reduce the time it takes to gather military service records from  National Guard and Reserve sources. We also recommended that VBA  develop improvements for partnering with Social Security Administration  officials to reduce the time it takes to gather medical records. Lastly, we  recommended that VBA develop a robust backlog reduction plan for its  initiatives that, among other best practice elements, identifies  implementation risks and strategies to address them and performance  goals that incorporate the impact of individual initiatives on processing  timeliness. VA generally agreed with our conclusions and concurred with our  recommendations, and summarized efforts that are planned or underway  to address them. For example, VA stated it has recently initiated several  interagency efforts to the timeliness of record exchanges between VBA  and DOD. VA also agreed  with our recommendation to develop a robust backlog plan for VBA’s  initiatives and, subsequent to our report, published the Department of  Veterans Affairs (VA) Strategic Plan to Eliminate the Compensation  Claims Backlog. In conclusion, for years, VA’s disability claims and appeals processes  have received considerable attention as VA has struggled to process  disability compensation claims in a timely fashion. VBA is currently taking steps to improve the  timeliness of claims and appeals processing; however, prospects for  improvement remain uncertain because timely processing remains a  daunting challenge.
Why GAO Did This Study

This testimony discusses the Department of Veterans Affairs' (VA) disability benefits program, which provides monetary support to veterans with disabling conditions that were incurred or aggravated during military service. In fiscal year 2013, VA estimates it will provide $59.6 billion in compensation benefits to 3.98 million veterans and their families. For years, the disability claims process has been the subject of concern and attention by VA, Congress, and Veterans Service Organizations (VSO), due in part to long waits for decisions and the large number of pending claims. For example, the average length of time to complete a claim increased from 161 days in fiscal year 2009 to 260 days in fiscal year 2012. Moreover, VA's backlog of claims--defined as claims awaiting a decision for over 125 days--has more than tripled since September 2009. In August 2012, approximately two-thirds of the 568,043 compensation rating claims--which include pension and disability rating claims--were backlogged. In addition, timeliness of appeals processing at VA regional offices has also slowed by 56 percent over the last several years.
This testimony is based on a GAO report released on December 21, 2012, titled Veterans' Disability Benefits: Timely Processing Remains a Daunting Challenge, and, also include information updated to reflect the status of improvement efforts. This testimony focuses on (1) factors that contribute to lengthy disability claims and appeals processing times at VA regional offices and (2) status of the Veterans Benefits Administration's (VBA) recent improvement efforts.

What GAO Found

GAO found a number of factors--both external and internal to VBA--have contributed to the increase in processing times and subsequent growth in the backlog of veterans' disability compensation claims. For example, the number of claims received by VBA has increased as the population of new veterans has swelled in recent years. Moreover, due to new regulations that established eligibility for benefits for new diseases associated with Agent Orange exposure, VBA adjudicated 260,000 previously denied and new claims for related impairments. Beyond these external factors, issues with the design and implementation of the program have also contributed to timeliness challenges. For example, the law requires VA to assist veterans in obtaining records that support their claim. However, VBA officials said that delays in obtaining military records--particularly for members of the National Guard and Reserve--and Social Security Administration (SSA) medical records impact VA's duty to assist, possibly delaying a decision on a veteran's disability claim. Further, VBA's paper-based claims processing system involves multiple hand-offs, which can lead to misplaced and lost documents and cause unnecessary delays. Concerning timeliness of appeals, VBA regional offices have in recent years shifted resources away from appeals and towards claims, which has led to lengthy appeals timeframes.
VBA has a number of initiatives underway to improve the timeliness of claims and appeals processing. Such efforts include leveraging VBA staff and contractors to manage workload, modifying and streamlining procedures, improving records acquisition, and redesigning the claims and appeals processes. According to VBA officials, these efforts will help VA process all veterans' claims within VA's stated target goal of 125 days by 2015. However, the extent to which VA is positioned to meet its ambitious processing timeliness goal remains uncertain. VBA provided us with several planning documents, but, at the time of our review, could not provide us with a plan that met established criteria for sound planning, such as articulating performance measures for each initiative, including their intended impact on the claims backlog. GAO has recommended that VBA (1) partner with military officials to reduce timeframes to gather records from National Guard and Reserve sources, (2) work with SSA to reduce timeframes to gather SSA medical records, and (3) develop a robust plan for its improvement initiatives that identifies performance goals that include the impact of individual initiatives on processing timeliness. VA generally agreed with our conclusions and concurred with our recommendations, and identified efforts that it has planned or underway to address them.