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Report critical of VA's handling of comp claims

| Monday, July 14, 2014, 12:01 a.m.

The federal agency responsible for caring for America's veterans, already mired in scandal over delays in health care, continues struggling with another major responsibility of paying compensation to those injured, wounded or who grew ill from service in uniform.

While the VA managed last year to reduce a huge backlog in veteran claims for money, it was at the expense of appeals to those decisions, which are rapidly mounting, according to testimony slated for Monday by the VA Office of Inspector General.

The written testimony provided by the House Veterans Affairs Committee in advance of a congressional hearing outlines several sloppy or improper steps taken by the Department of Veterans Affairs in processing compensation claims. They include a potentially inflated success rate in reducing a controversial backlog and overpaying veterans by hundreds of millions of dollars.

“These are challenging times for the VA,” said Linda Halliday, an assistant inspector general who authored the written testimony.

In response, the VA released the written testimony that will be delivered at a hearing on Monday by Allison Hickey, undersecretary for benefits who says the agency enjoyed “tremendous success” cutting into a backlog of delayed compensation claims.

Compensation for injuries or wounds incurred during military service is one of the most costly programs within the VA, expected to be $73 billion paid out to veterans this year alone.The money accounts for about half the agency's budget.

That portion of the agency that provides medical care to veterans is under investigation by the inspector general and Justice Department lawyers for systemic delays in care and fabricating false wait times to improve treatment performance numbers.

The scandal led to the resignation of Secretary Eric Shinseki in late May.

VA press secretary Drew Brookie issued a statement on Saturday saying the agency has “more work to do to achieve our goal ... Too many veterans still wait too long to get the benefits they have earned.”

Other mistakes or sloppiness cited by Haliday include:

• The VA failed to follow up with veterans granted temporary 100 percent disability pending improvement of their physical health. Investigators estimate this has resulted in $85 million overpaid since 2012 and could mean $370 million wasted in the next five years,

• Other VA processing responsibilities have suffered because of so much emphasis on reducing the compensation backlog. The number of pending appeals of compensation judgments has increased 18 percent since 2011 to nearly 270,000.

• Federal law prohibits reservists and National Guard troops from receiving drill pay and VA compensation at the same time. But the VA has failed to check on that, resulting in $50 million to $100 million in overpaid compensation annually.

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